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Budget 2020: An absence of vision
The Budget 2020-21 has projected that the ratio of total expenditure to GDP will be at 13.5 per cent, compared to 13.6 per cent in the previous fiscal year. This indicates that the centre has frozen the rate of government spending, and has not taken on itself the role of pump-priming the economy to ensure revival.
Sops that are no stimulus
There is reason to believe that the measures would not deliver the needed results.
Money Matters E09 | Bank Mergers, Is bigger always better? (3/3)
Part of the reason why the volume of NPAs increased dramatically is because during the years of the liquidity boom and credit surge after 2004, the government encouraged public sector banks to substitute for development finance institutions and lend to capital intensive projects and infrastructure.
Money Matters E09 | Bank Mergers, Is bigger always better? (2/3)
There is also little and only weak empirical support that there are significant economies of scale and scope in banking. While very small banks can gain by growing in size, beyond a point size does not seem to deliver any further advantage.
Money Matters E09 | Bank Mergers, Is bigger always better? (1/3)
The fact that the latest round of mergers was announced on the day when GDP statistics for second-quarter 2019, which pointed to a sharp deceleration of growth to 5 per cent, were released, suggested that the government was treating this as a measure aimed at reviving growth.
Money Matters E08 | Banking in India, From nationalisation to privatisation (3/3)
It is true that, thus far, neoliberal reform has not succeeded in reversing nationalisation, though public shareholding in most government-owned banks has been significantly diluted.
Money Matters E08 | Banking in India, From nationalisation to privatisation (2/3)
Small scale and other priority sector advances also rose, resulting in the increase in the share of priority sector advances in total credit from 22 per cent in 1972 to as much as 45 per cent at the end of 1980s.
Money Matters E08 | Banking in India, From nationalisation to privatisation (1/3)
The need for the nationalisation was felt mainly because private commercial banks were not fulfilling the social and developmental goals of banking which are so essential for any industrialising country.
The road to private dominance
Central to the economic strategy of the government seems to a massive hike in private domestic and foreign investment, combined with a set of schemes aimed at appeasing the peasantry, medium and small industry and the marginalised.