Thanks ,MR Rajan!
RBI revolts to do anything in accordance with RSS Hindu agenda!As Raghuram Rajan Says It's Not The Regulator's Job to Boost Sensex
Says export-led growth strategy will not be beneficial for India as China already has a strong presence in this area even as global economy recovery remains hazy!
Sounding a note of caution against Prime Minister Narendra Modi's 'Make in India' campaign, RBI governor Raghuram Rajan on Friday said it should not focus only on manufacturing.
It is a war crime against the people of India to link Indian economy with Dollar hegemony which is further linked to the global economy which is breaking up.
Palash Biswas
Raghuram Rajan, Manmohan Singh and Lord Meghnad Desai with others at 'Bharat Ram Memorial Seminar' at Ficci in New Delhi. (TOI Photo)
Reference:Modi had announced the ambitious 'Make in India' programme at his first Independence Day speech from ramparts of Red Fort to attract overseas investments and make the country a global manufacturing hub.
It is a war crime against the people of India to link Indian economy with Dollar hegemony which is further linked to the global economy which is breaking up.The International Energy Agency said prices are likely to come under further pressure, as it cut its outlook for growth in demand next year.
You know that big smile you've had on your face lately as you fill up your gas tank? Well, keep smiling. Oil prices have fallen again. U.S. crude settled below $58 a barrel today, a level not seen since the 2009 recession. NPR's John Ydstie has this report on the impact of those lower prices.
Ironically,Uncle Sam is not smiling at all.
Not even Narendra Bahi Modi seems to be smiling at all.
Rather the government of India has to wipe out the smil at every Indian face as it is trying the create an artificial energy crisis to hold on US business and economy at the cost of Indian industry,business and of course,the people including all the taxpayers and those who do not afford to pay the taxes.
America says:There's been a good deal of handwringing about the rapid fall in oil prices. The stock market has suffered as shares of oil industry companies have been hit and companies like Stone Energy Corporation, based in Lafayette, Louisiana, are cutting back their plans for exploration and development. Stone Energy's Ken Beer says with prices at current levels, it's hard to justify more drilling.
Modi and his government is working to cover up the acute problem faced by the Global manager of crude Oil,USA having shifted the burden on one billion and more of Indian consumers snatching the subsidy which should continue considering the steep fall of crude oil prices but the business friendly government of India is trying its best to kill subsidy on name of cash subsidy for which no Bank should be responsible,neither the gas agencies.
Meanwhile at home,the most persecuted executive, subject to most intense corporate lobbying,has declared a war against the free market growth saga and the phenomenon of free flow of foreign capital and black money in Indian economy.Banking on high voltage Hindutva ,the Billionaire Millionaire ruling hegemony is pressing hard to adjust interest rates yet again and the RBI governor does not oblige.Rather,he dares to say that the the role of a regulator is not to boost Sensex, he said. Higher Sensex can at best be a collateral benefit not a primary objective... the underlying growth is more important, he added.
Sounding a note of caution against Prime Minister Narendra Modi's 'Make in India' campaign, RBI governor Raghuram Rajan on Friday said it should not focus only on manufacturing. He said when India pushes manufacturing exports, it will have China to contend with and an export-led growth will not be as easy as it was for the Asian economies who took that path before India.
"I am...cautioning against picking a particular sector such as manufacturing for encouragement, simply because it has worked well for China. India is different, and developing at a different time, and we should be agnostic about what will work," Rajan said while speaking at the Bharat Ram Memorial Lecture in Ficci.
He further said there is "danger when we discuss Make in India" as something which is focused on manufacturing, "an attempt to follow the export-led growth path that China followed. I don't think such a specific focus is intended".
However,I dare not to guess about the next step of the renowned corporate lawyer who turned to be the finance minister of India.Despite North Block trying its best to push for a rate cut to instil growth, RBI has so far practiced restraint and made it clear it will not tinker with rates until inflation level comes down to 4%. "A 'Volker'-like disinflation was never on the cards in India, but an Urjit Patel glide path fits us very well, ensuring moderate growth even while we disinflate. Going forward, we will discuss with the government in an appropriate timeline within which theeconomy should move to the centre of the medium-term inflation band of 2-6%," said Rajan. The RBI governor will meet the finance ministry in the next two to three weeks time to discuss this.
Mind you,the RBI governor says, export-led growth strategy will not be beneficial for India as China already has a strong presence in this area even as global economy recovery remains hazy!On maintaining a balancing act between inflation and growth, Rajan hinted that the RBI will follow a very cautious approach, and reminded the government that mere dependence on monetary policy will not work. "Monetary stimulus will not do. The government needs to work on infrastructure," Rajan added.
Congrats! At least one among the whole lot of neoliberal children of economics dares to speak the truth at last which we had been emphasize for last twenty three years that the economy might not be doctored without addressing the basic problems of the economy!Without addressing the problems of the agrarian sector in neck deep trouble! Without addressing the plunging industrial as well as agrarian growth rates.
SENSEX indices may not cure Indian economy inflicted with viral free flow of Black money ejecting out the entire classes of producers and workers and employees out of the economy,practicing ethnic cleansing against nature associated communities to sell off national resources,devastating entire indigenous production system for outsourcing and service sector and linking the economy with dollar hegemony and oil economy!
Raghuram Rajan endorsed our concern.Thanks ,MR Rajan!
From Make in India to instilling growth in the economy, Reserve Bank of India (RBI) governor Raghuram Rajan on Friday gave a piece of his mind, which is unlikely to go down well with the Central government.DNA comments.
Wary over the world economy's appetite for yet another export-oriented economy, in the context of China already having a strong presence, Rajan said, "Export led growth strategy will not pay for India as it did for the Asian economies including China due to the tepid global economic recovery, especially in the industrial countries. A regional focus for exports will pay off. But the world as a whole is unlikely to be able to accommodate another export-oriented China." He was addressing Bharat Ram Memorial Lecture at Ficci.
Rajan, however, clarified that the he was not against exports. In what could be seen as the first critique of PM Modi's Make in India slogan, Rajan said, "I am counseling against an export-led strategy that involves subsidising exporters with cheap inputs as well as an undervalued exchange rates simply because it is unlikely to be as effective at this time. I am also cautioning against picking a particular sector such as manufacturing for encouragement simply because it has worked well for China," he said.
Governor Raghuram Rajan on Friday addressed India's top corporates on issues confronting the domestic and global economies. His speech came at a time when both the government as well as India Inc. have been gunning for a rate cut in view of the sharp slowdown in inflation.
Here are the important highlights of Dr Rajan's speech as NDTV reported:
1) Boosting markets not the regulator's job: The RBI Governor stood his ground on interest rates and said central bankers have to go against popular opinion. The role of a regulator is not to boost Sensex, he said. Higher Sensex can at best be a collateral benefit not a primary objective... the underlying growth is more important, he added.
2) No tradeoff between inflation and growth: Dr Rajan said a central bank focused on containing inflation will ensure best conditions for sustainable growth. He added that "a glide path" towards lowering inflation to those levels worked best for India by ensuring moderate economic growth.
3) "Make for India" also important: For "Make in India" to succeed, the government needs to implement ambitious infrastructure plans and reduce the cost of doing business in India, Dr Rajan said. But "Make for India" is equally important because external demand is weak, he said.
4) India does not need to go out of the way to get foreign investors: "If we make it easier for young companies to do business in India, it will create a transparent and quick system and will do the same for foreign investors," Dr Rajan said.
5) Need for fiscal prudence: Noting that the new government has indicated that it will stick to the fiscal consolidation path, the RBI governor proposed a debate on whether India needed more institutions "to ensure deficits stay within control and the quality of budgets is high."
6) India needs foreign finance, but the best bet to attract foreign investment is through long-term equity or foreign direct investment, he said. FDI also brings new technologies and methods, Dr Rajan added.
7) Domestic demand should be financed through domestic savings: This will ensure systemic stability and not precipitate a crisis seen last summer, when hot money exited India at the first hint of a crisis, he said. "Some budgetary incentives for household savings could help ensure that the country's investment is largely financed from domestic savings," Dr. Rajan said.
8) World cannot absorb two Chinas: Over the last three decades, most East Asian countries have developed on the back of export-based growth. Counselling against such a policy, Dr Rajan said subsidizing exports with cheap inputs and undervaluing exchange rate will be unproductive as India is different from China.
9) Global economy remains weak: The US is the only major economy growing currently. Many economies are near deflation and secular stagnation has been building in the global system. Policy makers have to do more than resorting to monetary stimulus (print money) to lift growth.
10) Middle class growing anxious: Incremental growth is coming from new technologies and globalisation, which means that a lot of routine jobs have gone away. The middle class is desperately anxious in US and Europe, Dr Rajan said.
"...I am counselling against an export led strategy that involves subsidising exporters with cheap inputs as well as an undervalued exchange rate, simply because it is unlikely to be as effective at this juncture," he added.
Further, he also said it may not be proper to see 'Make in India' as a strategy of import substitution through tariff barriers.
"This strategy has been tried and it has not worked because it ended up reducing domestic competition, making producers inefficient, and increasing costs to consumers," Rajan said.
He also said that India should also focus on domestic demand and create a unified market with a view to reduce transactions cost.
"If external demand growth is likely to be muted, we have to produce for the internal market. This means we have to work on creating the strongest sustainable unified market we can, which requires a reduction in the transactions costs of buying and selling throughout the country.
"Improvements in the physical transportation network... will help...A well designed GST bill, by reducing state border taxes, will have the important consequence of creating a truly national market for goods and services, which will be critical for our growth in years to come," he added.
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