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Will Now FOBs Really Give Priority to Priority Sectors? by Anirudh Rajan

With Priority Sector Lending Quotas becoming fully applicable to Foreign Owned Banks (FOBs), agrarian lending should expect a substantial boost in the coming year. This may not necessarily be the case though, as FOBs have proven adept at delaying and avoiding regulation, often using loopholes to skirt them completely. 
Last Thursday, Reserve Bank of India (RBI) issued a circular reaffirming that foreign owned banks (FOBs), having over 20 branches in India, meet sub-targets for loans to small and marginal farmers in priority sector lending. Set at 8% of Adjusted Net Bank Credit (ANBC), out of the 18% earmarked for the agrarian priority sector, the circular directs Standard Chartered Bank, Citibank and HSBC to start allocating a fifth of their priority sector loans to famers with landholdings less than 2 hectares, tenant farmers, share-croppers and landless agrarian labour. 
FOBs, for the longest time, were allowed to comply with concessional rates of priority sector lending. Up to 2012-1…
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Global Significance of Chinese Investments: Deliberations in Mumbai 04/03/2018

Legends: What are fitted values in statistics? The values for an output variable that have been predicted by a model fitted to a set of data. a statistical is generally an equation, the graph of which includes or approximates a majority of data points in a given data set. Fitted values are generated by extending the model of past known data points in order to predict unknown values. These are also called predicted values. What are outliers in statistics? These are observation points that are distant from other observations and may arise due to variability in the measurement  or it may indicate experimental errors. These may also arise due to heavy tailed distribution. What is LBS (Locational Banking statistics)? The locational banking statistics gather quarterly data on international financial claims and liabilities of bank offices in the reporting countries. Total positions are broken down by currency, by sector (bank and non-bank), by country of residence of the counterparty, and by na…

Insuring against Investment: How policies foster agricultural distress

Anirudh Rajan writes, Despite many critiques of agricultural insurance schemes more and more of the annual budget is being allocated towards insurance subsidies and often at the cost of more impactful programmes. These insurance schemes serve a dual purpose of temporarily stemming farmer backlashes from crop failures and lost earnings and at the same time enable the BJP’s corporate backers to profiteer off agrarian distress.


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GST – Impact on Small Industry and the Informal Sector

The Goods and Services Tax (GST), that came into effect on 1st July, 2017, has been lauded as the most comprehensive contemporary reform of Indian indirect taxation. Aimed at creating a common, unified and integrated domestic market, allowing the free flow of goods and services across state lines, GST is supposed to deliver Indian industry and thereby the economy the competitive edge apparently lacking till now.
Reality is however a far cry from the picture painted by government. GST by creating platform a conducive to economies of scale and nullifying regional tariffs, is both conceptually and practically advantageous to big business and detrimental to the informal sector and small businesses.
These groupings, informal and small, though quite different have some degree of overlap. Informal business is overwhelmingly small but not all small businesses are informal. GST’s impact on these groups is quite different both with regard to extent of impact or in terms of results sought.
Small Bu…

GST Round-Table Organized by Business Standard on the 6th of September 2017, New Delhi

On the 6th of September, 2017, the Business Standard organized a round table to explore the 2 month old Goods and Services Tax (GST) post the initial euphoria . It’s aim was to determine the efficacy of GST’s roll-out and gain a glimmer as how industry has reacted to the most substantial reform in contemporary Indian indirect taxation. The panel selected to facilitate the discussion was collected from diverse fields including the upper echelons of bureaucracy, industry and professional sector experts while the audience was predominantly middle management, entrepreneurs and entrenched professionals; doctors, lawyers and the like.
The event commenced with a key note address from Hansmukh Adhia, a revenue secretary. Adhia, declared GST to be a success while issuing a warning to industry that any delay in registration would be strictly penalized. He went on to state that there existed 86 lakh registrations under the old system spread over excise, service tax and state VATs. As manufact…