<!– /11440465/Dna_Article_Middle_300x250_BTF –>The deadline to deposit old Rs. 500 and 1,000 currency notes ends on Saturday. However, the people will still have time to exchange the currency notes at designated Reserve Bank of India (RBI) counters till March 31 after giving valid reasons for not depositing defunct notes in their accounts by December 30. From today, it will be illegal to have the banned notes and one could be fined heavily for carrying them according to a new law.One can deposit old notes only in select branches of RBI after today’s deadline. Furnishing wrong information while depositing the old currency between January 1 and March 31 will attract a fine of Rs 5,000 or five times the amount. Prime Minister Narendra Modi is likely to address the nation this evening, and according to reports, is expected to spell out the post-demonetization roadmap. This will be his second address to the nation since his announcement to scrap 1,000 and 500 rupees notes on November 8. While announcing the landmark decision, he had asked the people to give 50 days for demonetization and getting accustomed to a cashless economy. In a television address to the nation on November 8, Prime Minister Modi said, “The magnitude of cash in circulation is directly linked to the level of corruption. Inflation becomes worse through the deployment of cash earned in corrupt ways.” He said to break the grip of corruption and black money, the government has decided that from midnight Rs. 500 and Rs 1,000 currency notes will cease to be legal tender. Till date, the government has made several changes to the norms.After reports on crop sowing taking a hit due to no availability of cash, the government allowed the farmers to buy seeds with old Rs 500 currency notes. A November 17 announcement allowed the farmers to withdraw up to Rs. 25,000 per week from their KYC-compliant account.Following reports on abuse of Jan Dhan accounts, the Reserve Bank of India (RBI) capped the withdrawal limit to Rs 10,000 per month.On November 17, the government made more modifications to the existing rules. Families could now withdraw up to Rs. 2.5 lakh for weddings. The currency exchange limit was reduced from Rs 4,500 to Rs 2,000 per person.The traders in agricultural mandis were permitted to draw up to Rs 50,000 in cash per week to pay for sundry expenses like wages.Also, government employees up to Group C could draw Rs. 10,000 salary in advance in cash.The demonetization decision has also taken a toll on the common man, with reports of some dying while standing in queues to collect money. In between all this, Prime Minister Modi has continued to address the nation at various public gatherings and through his ‘Mann ki Baat’ radio programme.Making an emotional appeal at an event in Goa on November 13, Prime Minister Modi asked the “honest” people of the country to bear the hardships for another 50 days.Exactly two weeks later on November 27, the Prime Minister urged the farmers and small traders to go cashless at his monthly ‘Mann ki Baat’ address. “The common man will be trouble free if they are made aware of the digital financial transaction options,” he said asking the youth to lead the change.The opposition cornered the government during the Winter Session of Parliament over the inconvenience faced by the nation post-demonetization.
Mumbai: In a relief to common man, the Reserve Bank of India (RBI) on Friday said cash withdrawal limit from ATMs will be increased to Rs 4,500 per day from the current Rs 2,500 from 1 January.
However, there has been no change in the weekly withdrawal limit, which stands at Rs 24,000, including from ATM, for individuals (Rs 50,000 in case of small traders).
“On a review of the position, the daily limit of withdrawal from ATMs has been increased (within the overall weekly limits specified) with effect from 1 January 2017, from the existing Rs 2,500 to Rs 4,500 per day per card,” the central bank said in a notification.
Following demonetisation of old Rs 500/1000 notes on 9 November, limits had been imposed on withdrawal of cash from banks as well as ATMs.
The RBI’s notification further stated “there is no change in weekly withdrawal limits” and such disbursals “should predominantly be in the denomination of Rs 500”.
Earlier in the day, the RBI had permitted White Label ATM Operators (WLAOs) to source cash from retail outlets.
Most of the White Label ATMs are running dry since demonetisation as the operators were facing difficulties in sourcing cash from their sponsor bank(s).
Friday was the last day to deposit the invalid currency notes in banks. However, people still have time to exchange the currency notes at designated RBI counters till March 31 after giving valid reasons for not depositing defunct notes in their accounts by December 30.
First Published On : Dec 31, 2016 08:34 IST
2016 was a gloomy year.
Chaos overwhelmed order and noise trumped good sense all through. Propaganda suffocated truth and opinion rode roughshod over facts. At the end of it India appeared to have finally settled into the new normal.
Welcome to the post-truth age. And goodbye the old world obsessed with morality.
What is the defining feature of the new normal? It has to be obfuscation of and disregard for truth. It rides on the brute power of propaganda and not-so-subtle manipulation of mass opinion. Truth is no more simple black and white; it is imbued with many shades and ambiguities. Innuendos, insinuations and disinformation designed to be malicious and address the lowest common denominator play a role to cloud it.
India was angrier, bitter and more cynical than ever the whole of the year, thanks to the crudity in the air. The hate talk, the unbridled combativeness and expression of acrimony is likely to continue through the next year and beyond. The rise and rise of the emotion-driven, and sometimes irrational, Right is one reason why. The failure of those in the ideological Left and the middle to develop a convincing counter-argument to them is another. But the worst is the inability of the ordinary Indian to keep himself insulated from political developments and study the reality around dispassionately.
The new normal is characterised by low trust and the tendency of players, political and otherwise, to exploit the trust gap through calculated lies and half-truths spread among people. Lies are what remained in full play in 2016. Every allegation against every political leader in the media and elsewhere was falsehood. The choice of the word ‘lie’ is deliberate. Over the last two-and-half years we have been hearing of scandals and involvement of political biggies in them. Television channels produce irrefutable proof every other day. How come none of the accused is in jail so far? How come Robert Vadra‘s land deals make it to headlines every couple of months yet he is not even in the court once? Obviously, we were being fed untruth all along or someone wanted to keep us distracted from our many existential problems.
The worst part is, we as a people have started enjoying the lies, elevated them to some kind of mass entertainment. The spicier it is the better. Obviously, we don’t give a damn. We have made truth irrelevant to our lives and facts redundant.
In the process we have diminished ourselves morally. In the post-truth age morality, private, public and institutional has taken a dip. It was evident the way we bought propaganda peddled by politicians on both sides of the ideological divide with a conniving media with unrelenting relish and happily became part of their political wars. We forgot that the idea of India was bigger than any ideology or leader. It is unlikely to change anytime soon.
The diminishing of institutions of public trust is a dimension of the new normal. So when the judiciary passes a verdict it is no more accepted as sacrosanct; when the Army says it conducted surgical strikes there are as many doubters as believers and when the Reserve Bank of India offers facts on demonetisation, there is suspicion. The police no more inspires respect. Government, run by politicians as they are, has always been low on credibility. How does a democracy function when all its institutions lack vigour and the social capital called trust? We were too busy asserting ourselves over others to notice the damage to the institutions and with them the sense of order.
Yes, 2016 was gloomy. 2017 promises to be no better.
First Published On : Dec 30, 2016 18:29 IST
The draconian punishments announced for keeping more than 10 notes of demonetised currency including a four-year jail sentence seems to be a defence mechanism to discourage any trigger happy Public Interest Litigator from suing the Reserve Bank of India (RBI) for breaking its promise.
Every note carries the legend ‘I promise to pay the bearer the sum of…’ and the unilateral murder of these notes also leaves the RBI vulnerable to a breach of trust since the people were not party to the dissolution of the contractual obligation.
While illegally held notes or those that have been used for unlawful activities can be taxed and their holders penalised accordingly, the question that can be asked under the law is whether the promise still holds good.
Punish me as per the law but keep the written pledge.
In purely technical terms, going by the written pledge, the RBI is obligated to exchange every one of the notes with those of lesser denominations including coins because that is what it has said it will do.
But, wait a minute. Does it owe us an explanation and while it can be accused of clumsiness, is it legally within its rights to ‘renege’ on its agreement?
The promissory note has its antecedents in the gold standard when a note could be exchanged for precious metals and is based on the Bank of England’s monetary system. In fact, at one stage, every note had the name of the individual to which it was given as legal tender.
Today, the note has the signature of the governor of the Reserve Bank and under his assurance the note per se is neither black, white, laundered or, in any way, reduced in value vis a vis the promise written on it.
As a legal conundrum how would the RBI defend itself? By citing the greater good? By underscoring the criminal element in its war on the parallel economy? By submitting that the pledge was initially broken by the people who misused the note and therefore rendered the promise null and void.
Perhaps the RBI’s best bet is to state that the Indian currency note is not a promissory note as it was in the old days but is money like the coins and, therefore, not accountable legally if the promise is not kept.
If that be so and this argument will be the mainstay of the government’s stand why have the legend on the note at all along with the governor’s signature? Doesn’t it have any sanctity?
The government will say that it is a convention with no locus standi in the court of law.
Consequently, since there is a ‘for’ and an ‘against’ argument, the Rs 500 and Rs 1,000 notes that were demonetised each can have a day in court because its owner has had a pledge broken.
But it is a losing battle. Modern Indian currency is not officially seen as being a descendant of the old notes from the history books but just cash.
While most of us do not really care very much and will not do anything, one can question the premise that legally the RBI is duty-bound to honour every single note and see it as mutually exclusive from who owns it or what laws that the owner has broken.
The RBI, in simple terms, is not the police.
After all, if there is no value to the promise and the signature and the Indian currency is purely money why repeat this pompous commitment on the new notes.
Would this make for a stronger petition one cannot say but it is an interesting situation.
Problem there is that in no place on the note does it mention conditions under which this promise can be negated.
First Published On : Dec 29, 2016 14:05 IST
In further relief to people hit by demonetisation, the Reserve Bank on Wednesday gave borrowers another 30 days over and above 60 days for repayment of housing, car, farm and other loans worth up to Rs 1 crore.
“On a review, it has been decided to provide 30 days, in addition to the 60 days provided (on November 21),” the RBI said in a notification.
So, borrowers together get 90 days breather from getting the account classified under non-performing asset (NPA) category.
The above dispensation will apply to dues payable between 1 November, and December 31, 2016, it said.
The surprise announcement made by Prime Minister Narendra Modi on 8 November to scrap Rs 500 and 1,000 notes resulted in a cash crunch in the market leading to slowdown in business. As a result, the repayment capacity of the borrowers were impacted and there was fear of loan default rising.
The demonetisation of higher value currency notes has affected normal banking activities including clearing of cheques. Besides, borrowers are unable to get payments from their creditors due to various restrictions including cash withdrawal limit of Rs 24,000 per week, limiting their options to repay their dues.
According to the RBI notification, running working capital accounts or crop loans with the sanctioned limit of Rs 1 crore or less would be eligible for this benefit. Besides, it said, “Term loans for business purposes, secured or otherwise, the original sanctioned amount whereof is Rs 1 crore or less, on the books of any bank or any NBFC, including NBFC (MFI). This shall include agriculture loans.”
The apex bank further said that all regulated entities are permitted to defer the downgrade of an account that was standard as on 1 November, but would have become NPA for any reason between November and December by 90 days from the date of such downgrade.
The additional time of 90 days will only apply to defer the classification of an existing standard asset as sub-standard and not for delaying the migration of an account across sub-categories of NPA. Dues payable after 1 January, 2017 will be covered by the instructions for the respective entities.
Last month, the RBI had provided additional 60 days for repayment of loans worth up to Rs 1 crore. Separately, the central bank came out this special dispensation for farm loan earlier this week.
First Published On : Dec 29, 2016 07:48 IST
<!– /11440465/Dna_Article_Middle_300x250_BTF –>The Income Tax department has initiated action against 14 cooperative banks in Karnataka for holding back information amounting to abetting tax evasion in respect of deposits as it came across Rs 7,636 crore of amount in 80 banks in searches during this year.I-T Director (Intelligence and Criminal Investigation) Ravichandran Ramaswamy told reporters in Bengaluru that the department during 14 searches conducted on banks, especially cooperative banks, during the year so far, found an amount of (deposits) Rs 7,636 crore.”We have, as of today, found out an amount of Rs 7,636 crore in 14 searches conducted on banks, especially cooperative banks in current year across Karnataka… We have taken action against 14 cooperative banks as they have been exposed to prosecution for holding back information, which amounts to aiding and abetting tax evasion,” he said.Replying to a query, Ramaswamy said out of the 285 banks in Karnataka, 80 banks have not been providing information by way of annual returns. “They will have to face penalty of Rs 500 every day,” he said.He further said the department had also issued as many as 2,300 letters to the depositors, asking them to pay up taxes on their deposits. “We have already got 800 people coming forward to declare their income and paying up taxes and penalty,” he said.Ramaswamy said the department has also intimated the Reserve Bank of India to conduct inspections on banks which were not disclosing information (about deposits). “We have also written to Registrar of Karnataka Cooperative to take action,” he added.
<!– /11440465/Dna_Article_Middle_300x250_BTF –>As Prime Minister Narendra Modi gets ready to address the nation after almost 50 days into demonetization on December 30, a reliable source told DNA that the government was seriously considering relaxing current restrictions on withdrawals from banks and ATMs from Rs 2,500 per day and Rs 24,000 per week to Rs 4,000 per day and Rs 40,000 per week respectively.Modi had sought 50 days to normalise the liquidity situation after he made Rs 500 and Rs 1,000 notes illegal from November 8 midnight.A source in the government, who spoke on condition of anonymity, said since the shortage of cash continued to persist, the restriction on withdrawal may not be completely removed but would be eased.”Today, for instance, the restriction is Rs 24,000 per week and Rs 2,500 per day; they might increase that to Rs 4,000 per day and Rs 40,000 per week, but nevertheless, will continue with the restrictions. All of this is expected to be announced by the PM on December 30 evening. He is planning an address (to the nation) at 8 pm in which he is going to connect what he said on November 8 and ask countrymen to be patient,” he said.Also, the government is contemplating an ordinance to restrict holding of banned notes and penalising their possession of beyond a certain limit after December 30. However, the ordinance is likely to be issued only after the liquidity situation improves. “That (ordinance) is being discussed very seriously, but there are two specific challenges. One is that in terms of the RBI (Reserve Bank of India) notification issued on November 8 that even after January 1 people have time till March 31 to deposit with RBI. Technically the ordinance can’t be issued with effect from January 1 because if they say that holding the currency is illegal after January 1, then those who would have planned to deposit it with the RBI (after December 30) will not have that window (given by the government earlier),” said a source.The second issue was shortage of liquidity in the economy; “even today, the country is largely running on Rs 2,000 note. Other denomination notes have not yet been made available and the process of contracting for new currency notes has just started. The problem is not going to vanish from first week of January,” he said.According to the source, tenders for printing of new currency notes of Rs 500 and Rs 2,000 were issued from December 22. “The government can’t just call anybody and ask them to do it. They have to buy the paper, the ink, open tender, and then do it,” he said.Also, the government does not want to take any unpopular decision. “With the after-effects of demonetization still lingering, it does not want to become more unpopular—saying on one hand that holding old money is illegal and you can be penalised, while on the other it still cannot meet the currency demand,” he said.
New Delhi: All India Bank Officers’ Confederation (AIBOC) has registered a protest to RBI on bank officers being assigned investigative role for customers depositing in excess of Rs 5,000, and demanded complete withdrawal of the order as the staff are facing public wrath.
Even as RBI partially modified its deposit guidelines, the union will be holding demonstrations all over the country in front of Reserve Bank of India offices later on Wednesday to press for withdrawal of the notification.
The RBI on Wednesday modified guidelines saying KYC compliant account holders can deposits more than Rs 5,000 in old currency notes without being questioned by bank officials.
Earlier this week, the RBI issued a notification directing banks to conduct due diligence of customers who wish to deposit more than Rs 5,000 in old currency till 30 December.
“The credit in such cases shall be afforded only after questioning tenderer, on record, in the presence of at least two officials of the bank, as to why this could not be deposited earlier and receiving a satisfactory explanation,” RBI had said.
“The instructions issued vide the RBI communication dated 19 December must be withdrawn forthwith as the banker shall not carry out the duties of CBI/ED/IB at the busy counters,” AIBOC General Secretary Harvinder Singh said in a representation to RBI Governor.
No accountability should be fixed on the bank officers in this respect as they are thrust with a role not expected of them, it added.
“Having demanded this, we strongly feel that withdrawal of the instruction itself will only confirm the Prime Minister’s statement to the public on November 8 and improve public confidence in the banking system and reduce the hardships faced by the officers at counters,” it said.
Pointing out that the banking system itself is losing credibility because of frequent changes in RBI/Government policies, Singh said customer dissatisfaction is increasing because of chaos and confusion created in implementation of the scheme.
“Bank Officers are being subjected to the anger, anguish and wrath of customers or general public due to short supply of currency notes to the banks, particularly to Public Sector banks,” it said.
First Published On : Dec 21, 2016 14:53 IST
<!– /11440465/Dna_Article_Middle_300x250_BTF –>With the Opposition joining hands against the Prime Minister Narendra Modi-led government’s decision to demonetize high-denomination currency notes of Rs. 500 and Rs. 1,000, Congress president Sonia Gandhi’s son-in-law, Robert Vadra on Tuesday joined the onslaught and launched a twin attack over demonetization and the recent Reserve Bank of India (RBI) announcement on deposits.”It is sad to see people suffering due to the whims & fancies of the government. I feel for the people and their difficulties they have and are facing,” Robert Vadra said in a post on his Facebook account.Regarding the recent announcement by the RBI allowing deposits of old notes exceeding Rs. 5000 only once till December 30 after a satisfactory explanation, Vadra mocked the government for turning banks into interrogation offices.”Now, deposits of more than Rs. 5,000 of demonetized currency notes will be allowed only once till December 30 & that too with an explanation. It has turned financial institutes into interrogation offices,” he said.
<!– /11440465/Dna_Article_Middle_300x250_BTF –>Coming down heavily on the Centre over the burning issue of demonetization, the Congress on Tuesday said the rules related to the move have changed over a 100 times since the major step was taken and over a 100 people have died, but it seems to have made no difference to the government which continues to remain unashamed of the inconvenience it has caused across the nation.”We want to ask Modiji that he had said on November 8 that people can deposit money in their accounts till December 30 and in the Reserve Bank of India (RBI) till March 21, 2017, so why has he betrayed the people now? Till today, rules related to demonetization have changed 125 times. More than 100 people have died. Still the government is not ashamed of itself,” Congress leader Randeep Surjewala said.Miffed with the fact that a person can neither withdraw his money, nor deposit, Surjewala said only Modi government could lead to such bankruptcy.Commenting on the recent development announced by the Reserve Bank of India stating that deposits exceeding of old Rs 500 and Rs 1000 notes exceeding Rs 5000 shall be made only once per account till December 30 but after a satisfactory explanation, Surjewala said that even the banks are going to look like police stations asking questions to one about his own money.”Modi government has led to twin surgical strike on India’s workers, labourers and the common man. On the one hand, the interest rate of Employees’ Provident Fund (EPF) has been reduced from 8.8% to 8.65% & on the other hand, in a (Tughlaqi farmaan) has now put a cap of Rs. 5000 on one’s own deposits. Even when you will go to make deposit, the bank officer will question you like a police inspector and will ask you the source of the money,” he said.Striking the same chord of objection over Prime Minister Modi’s absence in parliament, Surjewala asked the former to show some courage. “In spite of 300 members of parliament, Modiji is shying away from having a discussion on demonetization scam and its investigation. He has time to attend rock concerts, to put allegations in rallies, but does not have the courage to respond in parliament. Modiji, show some courage and stop insulting democracy,” he said.”The truth of deceit will be revealed only after the investigation of the demonetization scam. Modi ji, the entire nation knows that your intentions are black,” he added.The Reserve Bank of India (RBI) on Monday announced that deposits of old Rs 500 and Rs 1,000 notes exceeding Rs. 5000 shall be made only once per account until December 30 but after a satisfactory explanation.Tenders of Specified Bank Notes (SBNs) in excess of Rs. 5000 into a bank account will be received for credit only once during the remaining period till December 30, 2016. The credit in such cases shall be afforded only after questioning the tenderer, on record, in the presence of at least two officials of the bank, as to why this could not be deposited earlier and receiving a satisfactory explanation.
The finance ministry and the Reserve Bank of India have put in place new restriction on deposits of old Rs 500 and Rs 1,000 until 30 December in another effort to curb money laundering.
According to a finance ministry notification (read here), deposits of the demonetised notes above Rs 5,000 can be made only once until 30 December, the last date for banks to take deposits of old notes. However, there is no restrictions on depositing cash under the Pradhan Mantri Garib Kalyan Yojana, a black money declaration scheme under amended taxation laws.
“Tenders of SBNs (specified bank notes) in excess of Rs 5,000 into a bank account will be received for credit only once during the remaining period till December 30, 2016,” the RBI said in a notification to banks posted on its website.
The central bank has also said in such cases the notes will be credited to deposits “only after questioning tenderer, on record, in the presence of at least two officials of the bank, as to why this could not be deposited earlier and receiving a satisfactory explanation”.
“The explanation should be kept on record to facilitate an audit trail at a later stage. An appropriate flag also should be raised in CBS to that effect so that no more tenders are allowed,” the RBI has said.
However, banks can allow deposits of up to Rs 5,000 in value to be credited to bank accounts in the normal course until 30 December.
Moreover, if you have made deposits smaller that Rs 5,000 your account, and if such deposits taken together on cumulative basis exceed Rs 5,000 then they may still have to face the questions from the banks officials. In such cases, you may not be allowed to make more deposits thereafter until December 30.
Also deposits above Rs 5,000 shall be credited to only KYC compliant accounts and if the accounts are not KYC compliant the limit for deposits stays at RS 50,000.
However, these rules are not applicable to deposits under the Taxation and Investment Regime for the Pradhan Mantri Garib Kalyan Yojana.
First Published On : Dec 19, 2016 13:53 IST
<!– /11440465/Dna_Article_Middle_300x250_BTF –>Army convoy attacked on Srinagar-Jammu Highway in Pampore, 3 soldiers deadA massive manhunt has been launched to track down the terrorists. Read more hereDemonetization a ‘Modi-made disaster’, PM sparing the 1% super-rich : Rahul GandhiEscalating his attack on Prime Minister Narendra Modi, Rahul Gandhi on Saturday trashed demonetization of high value currency notes as a “Modi-made disaster”. Read more hereTwo RBI officials arrested in Rs 1.99 crore currency conversion caseCBI has arrested two employees of cash department of Reserve Bank of India (RBI) in Bengaluru in connection with alleged conversion of Rs 1.99 crore of demonetized currency with specified bank notes of Rs 2,000 and Rs 100. Read more hereInternational community has failed Syrian people, Aleppo is now a ‘synonym for hell’: Ban Ki-moonUN Secretary General Ban Ki-moon has said the carnage in Syria remains a “gaping hole” in the global conscience. Read more hereIND vs ENG: After visitors score 477 in 1st innings, India off to a sedate startIndia claimed three wickets on the second morning but the 108-run partnership between Dawson and Rashid in a productive second session for the touring side frustrated the hosts. Read more hereConfirmed: Ditya Bhande wins Super Dancer!Another reality show has reached its culmination. Sony TV’s Super Dancer has just wrapped its finale episode and Ditya Bhande has walked away with the trophy. Read more here
India’s central bank has unexpectedly held interest rates at a six-year low.
An intense cash shortage in India could force the central bank to cut interest rates to a six-year low on Wednesday as Prime Minister Narendra Modi‘s currency gamble threatens to hit nearly every aspect of the economy, from consumers to supply chains.
A majority of the nearly 60 analysts polled by Reuters predict the Reserve Bank of India (RBI) will cut the repo rate by 25 basis points (bps) to 6 percent, the lowest since November 2010, while six predicted a deeper 50 bps cut.
Pressure on the RBI and Governor Urjit Patel to act has grown since Modi stunned the country on 8 November with a drastic plan to abolish 500 and 1,000 rupee notes, removing 86 percent of the currency in circulation in a bid to crack down on India’s ‘shadow economy’.
Data so far shows the measure has hit the cash-reliant economy more than expected: auto sales plunged and services sector activity dived into contraction last month for the first time in 1-1/2 years.
The prospect that India’s robust growth will be derailed could offset any worries about a volatile global environment, which saw the rupee sink to a record low last month as part of a sell-off in emerging market assets.
Analysts say the RBI has room to act given consumer inflation eased in October to 4.20 percent, the slowest pace in 14 months and below the RBI’s target of 5 percent for March 2017.
“We expect the RBI monetary policy committee (MPC) to cut rates by 25 basis points,” said Radhika Rao, an economist with DBS Bank, in a note.
“While lingering external uncertainties raise the odds of a no-move, the RBI MPC is likely to take a growth supportive stance to offset downside risks to growth from the demonetization effort.”
A rate cut is not without risks. It would mark a second consecutive 25 bps easing by the six-member MPC, and some foreign investors warn it could raise concerns about whether the central bank is losing its focus on inflation.
A cut would also come at a time when emerging markets are under pressure after the election of Donald Trump as US president last month sparked a surge of capital flows back into the United States, a trend that could accelerate as the Federal Reserve gears up to raise interest rates next week.
In India, foreign investors sold a net $4.7 billion in debt and equities in November even, though the country is seen as in better shape than other emerging markets.
But a rate cut would signal the RBI’s priority is in supporting the economy, which grew an annual 7.3 percent between July and September, the fastest rate for a large economy in the world but still below the levels needed to sustain full employment.
Investors will also want more details from Patel about how the RBI is managing the process of demonetization after coming under criticism from market participants for frequently announcing adjustments to its policies.
Most analysts say the RBI will likely partly roll back a directive for banks to place their entire deposits under the central bank’s cash reserve ratio in a bid to absorb the extra liquidity generated by the government’s banknotes move.
The need to keep it in place has eased after the government announced last week it would raise the issuance of special bonds to soak up the liquidity.
First Published On : Dec 7, 2016 10:49 IST
That the Reserve Bank of India will most likely cut interest rate today is now almost a foregone conclusion. Economists are mostly betting on whether it will be 25 basis points or 50 bps.
The key reason being cited is that the central bank will have to cut rate to boost growth as the government’s demonetisation move is slowing down consumption and economy.
Two-thirds of the 60 economists polled by Reuters said they expected a cut, with 31 of 56 respondents expecting it to be 25 bps, while six predicted a deeper 50 bps reduction. One said the RBI would slash rates by 75 bps.
“Given the concerns about demonetisation and the slowdown it is likely to generate in sectors that have traditionally been cash dependant, such as consumption goods, the RBI will try to cushion the blow with a rate cut,” said Shilan Shah of Capital Economics in Singapore has been quoted as saying in the Reuters report.
A rate cut seems to be the only pill that the central bank can administer at present to boost the economic growth and the consumer confidence.
The government on 8 November announced its decision to demonetise Rs 500 and Rs 1,000 notes and replace them with new ones, in a bid to curb black money generation, fake currency usage and terror funding. The unexpected move resulted in a cash crunch as the RBI was not prepared to meet the demand for new notes. The demonetised notes formed 86 percent of the currency in circulation by value.
In this context, here are the key aspects you should watch out for in the policy statement today.
Ever since the demonetisation, the central bank and governor Urjit Patel have both come under criticism for keeping mum about the steps taken. The two times Patel spoke – interviews to PTI and Quint – he just made a customary assurance that the central bank is doing everything to reduce genuine customers’ pain. That was hugely insufficient to calm given the difficulties faced by not just the general public but also the bank staff. Bank unions have written to the finance ministry explaining the various hardhsips faced by their members. According to the union, the central bank has been saying there is enough cash and it is being dispatched to the banks while banks are getting only limited cash. Due to repeated assurances given by the RBI, customers feel that the banks are rationing the cash to them for no reason and this is resulting in tension. Again, they also have raised a suspicion that the RBI is preferring private sector banks to public sector ones while disbursing cash. The policy review today is a chance for Patel to clear all these charges. Will he speak up? Will he reveal the status of currency printing in its presses? How much rupee notes have been printed? How much more have to be printed to completely replace the demonetised currency? When does he think the situation will normalise?
About deposit amount banks got
This number is important. In the absence of regular details from the central bank, there are many numbers doing the rounds. The RBI just twice put out releases on this data and the last one was on 8 November. According to the latest numbers available through sources, as much as Rs 12 lakh crore worth old currency has returned to the banking system as deposits. This is against the government’s estimate that it would get back Rs 10 lakh crore and the rest will be extinguished. There was expectation that this will result in a windfall for the central bank which could have been transferred to the government by way of special dividend. This is as of now a speculation. The government and the RBI have neither denied it nor have they clarified. So also the case of fake currency. A report in The Times of India has said 20 days after demonetisation only 3.4% of all notes returned were counterfeit. Both these, according to many, mean that the scheme has failed in its objective. Worse still is the speculation that the rich and wealthy have already laundered their money. A report in The Indian Express noted that from tiffin service to dental implants, everybody has tried to beat the system and swap old notes. What is the RBI’s thinking? Is the suspicion that the rich and wealthy are gaming the system that forced the authorities to change the rules every other day?
As of now, India is the fastest growing economy. It grew 7.3 percent in July-September, better than the previous quarter’s 7.1 percent. However, with demonetisation curbing the spending power
of the RBI, various agencies and brokerage houses have slashed their growth estimates. Former prime minister Manmohan Singh has said he expected the GDP to fall by 200 basis points. What is the RBI’s take? Its estimate for the current year is 7.6 percent. Most probably the central bank will give out a revised estimate for the current year. Watch out for that.
Inflation or deflation?
Inflation is already trending downwards due to the favourbale monsoon that has improved the productivity of food items. In October, the retail inflation was 4.21 percent, lower than 4.39 percent in September. The food inflation, meanwhile, stood at 3.32 percent compared with 3.96 percent in the previous month. The corresponding figure for July 2016 was a higher 8.35 percent. The slower demand induced by demonetisation is seen further pressuring the prices down. There is even a view that the entire process is deflationary. If it is indeed so, this would do more harm to the economy. The RBI is bound to give some clarity on this, including a revised estimate for inflation. Look out for the number.
One could easily argue that the central bank need not clarify all of these. But given the grand scale at which the demonetisation is being rolled out and the way it is impacting the general public, there is a need for more transparency on the workings of the central bank. But, ironically, the RBI has gone into the opaque mode.
This has seriously dented the image of the central bank. Bank officers’ confederation has even sought the resignation of Patel taking moral responsibility for the havoc in the financial system.
Today’s policy review is a chance for the central bank and its governor to clarify and bring back the integrity of a democratic institution, which has always refused to genuflect before the political bosses in Delhi. The question is will Patel live up?
First Published On : Dec 7, 2016 08:25 IST
<!– /11440465/Dna_Article_Middle_300x250_BTF –>The Bombay High Court on Monday asked the RBI to consider the issue of payment of salaries to aided school teachers since it is disbursed through district cooperative banks which have been prohibited from depositing and exchanging old currency notes.The Mumbai, Solapur, Nashik and Pune District Central Cooperative Banks had approached the high court challenging the RBI circular of November 14, restricting them from exchanging or depositing old currency notes of Rs 500 and Rs 1,000, which were declared as illegal tender under the government’s demonetisation move on November 8. Solapur co-operative bank counsel V M Thorat today informed the court that the bank receives around Rs 95 crore from the state government for salaries of teachers in aided schools, but due to the circular the bank is not able to disburse the amount. A division bench of Justices A S Oka and Anuja Prabhudessai asked the Reserve Bank to consider the issue.”RBI needs to consider this issue. We cannot take this matter up on merits as the Supreme Court is already seized of the main contentions raised in the petitions, but this particular issue about teachers’ salaries can be looked into,” Justice Oka said. “It is common knowledge that teachers of aided schools get their salaries from cooperative banks. We want to know how teachers will get their salaries now,” the court said.Thorat informed the bench today that the banks have filed application in the apex court seeking clarification on whether the high court can hear the matter. “The application along with the transfer petition filed by the Union government seeking for all petitions filed on the demonetisation issue to be heard by SC itself is posted for hearing on December 9,” the counsel said. The high court then adjourned the cooperative banks’ petitions to December 14.
<!– /11440465/Dna_Article_Middle_300x250_BTF –>The Reserve Bank of India (RBI) has said that it will issue new series of Rs 20 and Rs 50 notes, while the existing ones will continue to be legal tenders.“Will shortly issue Mahatma Gandhi series-2005 without the inset letter in both the number panels, bearing the signature of Urjit Patel, Governor, RBI, and the year of printing 2016 will be printed on the reverse side.“The design and security features of these notes will be similar to the Rs 50 notes, with the ascending front of numerals in both the number panels without the intaglio print as in the earlier Mahatma Gandhi series 2005,” the RBI said.With the government printing more Rs 2,000 notes, people are finding it difficult to get smaller denomination notes. This may have forced the government to get fresh sets of lower-denomination notes. The Rs 100 notes comprised 17.5 per cent of the total currency in circulation until March 2016, according to the last figures from the RBI. Data shows Rs 50 constituted 4.3 per cent of the total cash in circulation and Rs 20, 5.4 per cent.NS Venkatesh, Executive Director, Lakshmi Vilas Bank, said: “The small notes in circulation will take care of the daily payments by individual households, and for larger payments, we can use the digital channel. I think the Government of India and the Reserve Bank of India(RBI) are on the right track.”
<!– /11440465/Dna_Article_Middle_300x250_BTF –>Simplistic to blame Pakistan for Afghanistan’s troubles: Under-fire Sartaj Aziz at Heart of AsiaUnder severe attack over terrorism emanating from its soil, Pakistan’s Foreign Affairs Advisor Sartaj Aziz hit back saying it is “simplistic” to blame one country even as he raked up the issue of strain in Indo-Pak ties at the Heart of Asia (HoA) conference on Afghanistan. Read more here.Heart of Asia Conference: Silence, inaction will only embolden terrorists and their masters, says PM ModiIn a clear message to Pakistan, Modi called for “resolute action” not just against forces of terrorism but also against those who support, shelter, train and finance them, saying silence and inaction will only embolden terrorists and their masters. Read more here.Mithali Raj helps India pound Pakistan to complete Asia Cup double hattrickIndian women maintained their supremacy in the Asia Cup by beating arch-rivals Pakistan for their sixth title in as many editions in Bangkok on Sunday. Read more here.Full Text: New Rs 20, Rs 50 notes to be issued by the RBIThe Reserve Bank of India (RBI) will issue new Rs 50 and Rs 20 notes, announced the apex bank on its website on Sunday. The new notes for both the denominations will bear the signature of the new governor Urjit Patel along with the year, ‘2016’ printed on the reverse side of the note. Read more here.Bromance Alert: This picture of Salman Khan and Shah Rukh Khan twinning will make your day!The two are going to be seen together at the Star Screen Awards 2016 for which, they were spotted rehearsing last night. See the picture here.
Nagpur: The Bombay High Court has sought response from the Finance Ministry and Reserve Bank of India on a PIL seeking extension of deadline for exchanging the demonetised notes.
A division bench of Justices Bhushan Gavai and Vinay Deshpande issued the notices yesterday while hearing a Public Interest Litigation (PIL), and posted the matter for further hearing after three weeks.
The petitioner, Urmila Wasudeo Kowe, said in her PIL that there should be more time to exchange old high denomination notes. The earlier deadline of November 24 to change the now defunct Rs 500 and Rs 1,000 notes has expired and many in rural areas and those from working class, could not change their hard earned money. For such segment, the time limit should be extended.
The Central government demonetised the old high currency notes with effect from 8 November midnight and granted time till 24 November to exchange old notes.
The labour, working class and migrant workers also have old notes and they are unable to deposit the same as many of them do not have bank accounts. It is not possible for them to reach to RBI and such persons should be allowed to exchange old notes from nationalised banks, the PIL said, while seeking such a direction to the RBI and the Centre.
Advocate Ashwin Ingole appeared for the petitioner.
First Published On : Dec 2, 2016 14:26 IST
<!– /11440465/Dna_Article_Middle_300x250_BTF –>The Reserve Bank of India (RBI) and commercial banks are making all efforts to increase the supply of cash to meet the payday rush. Banks said they are rationing cash so that it can be equitably distributed to locations where there is an increased demand.State Bank of India (SBI), which controls 15 per cent of the banking sector, said it did 95 lakh transactions, disbursing about Rs 4,600 crore all over the country, till 5 pm on Thursday.Manju Agarwal, Deputy Managing Director, SBI, said: “We are using analytics to determine which areas have greater demand and are diverting money to those centres.” Some bankers said that they received increased supply from the RBI to meet the month-end needs of the salaried class and the pensioners. But still in many locations, it fell short of demand.”We are ensuring equitable distribution of cash received from RBI across our branches and ATMs so that customers face minimal inconvenience,” Kotak Mahindra Bank spokesperson said.Surinder Chawla, the bank’s head (branches and business banking), said: “We are geared up with extra staff to deal with the enhanced rush. We have arranged for cash from all sources and made it available to all branches sufficiently. Our m-ATMs are reaching out to as many areas as possible, allowing withdrawals in societies and offices. We are also stocking ATMs in key areas (of high salary withdrawals).”According to rating agency Crisil, “The problem gets compounded because of a preponderance of cash transactions in the humongous informal sector, which cannot be accurately measured or monitored. Infusing replacement notes has been very sluggish and the ensuing cash choke has pulled back the business cycle, which was beginning to accelerate on the back of a good monsoon, the seventh pay commission, pay hike and One Rank, One Pension Scheme.”More than 1.25 lakh employees of the Brihanmumbai Municipal Corporation (BMC) had their salaries directly transferred into their bank accounts. No cash transactions are done by the civic administration with their employees – either permanent or on a contractual basis.”We do not give any component in cash. The entire salary is deposited in the bank account of employees. In fact, we do not even pay our contractors in cash. They are given cheques and they then disburse the amount to the labourers. We expect that even contractors pay wages to labourers through banks,” said Sudhir Naik, Deputy Municipal Commissioner (General Administration Department).There are four currency presses — Nashik (Maharashtra), Dewas (Madhya Pradesh), Salboni (West Bengal) and Mysuru (Karnataka). The first two are owned by the Central government through the Security Printing and Minting Corporation of India Ltd. According to the Finance ministry’s latest annual report, the yearly currency printing capacity of these two presses is around 40 per cent of the total in the country. The other two are part of the Bharatiya Reserve Bank Note Mudran Pvt. Ltd (BRBNMPL), a wholly owned subsidiary of the Reserve Bank of India (RBI).These two presses can print 16 billion notes in two shifts per year, according to the BRBNMP website. This means that the total capacity in the country would be 26.66 billion notes in two shifts. The government says that the presses are running in three shifts to meet the increased demand.
Mumbai: Nearly 90 percent of the 2 lakh ATMs deployed across the country have been re-calibrated to dispense the new 500 and 2,000 rupee notes, says a key maker of the machines even as millions of people continue to face acute cash shortages in the aftermath of demonetisation last month.
As per the plan, all the ATMs should have been ready by yesterday.
These machines needed to be re-calibrated after the government on 8 November announced the scrapping of old 500 and 1,000 rupee notes in a bid to crack down on black money, and introduced of new 500 and 2,000 rupee notes of different size and high security features.
“A working group, formed under a RBI headed task force, was given a deadline to recalibrate all the ATMs by 30 November. About 90 percent, which is around 1.80 lakh ATMs, have been re-calibrated so far to dispense new Rs 500 and Rs 2,000 notes,” ATM manufacturer NCR Corporation’s managing director, (India & South Asia) Navroze Dastur told PTI.
Following the announcement to scrap old high currency notes, a task force was set up on 14 November under the chairmanship of Reserve Bank deputy governor S S Mundra to oversee the recalibration process of all the ATMs.
Under the task force, a working group was formed which included of representatives of ATMs manufacturers like NCR, Diebold Nixdor, cash in transit companies and managed service providers, among others.
Dastur said the working group consisted of around 40-60 people and they have been recalibrating on an average 12,000 ATMs per day.
He said the rest of the ATMs would be re-calibrated over the next 10 days to dispense new notes.
First Published On : Dec 1, 2016 17:51 IST
The Reserve Bank of India, on Wednesday, set a limit of Rs 10,000 per month for withdrawals form the Jan Dhan Yojana accounts.
“Fully KYC compliant account holders can withdraw up to Rs 10,000 from their account in a month. The bank managers may allow further withdrawal beyond Rs 10,000 within the current applicable limits only after ascertaining the genuineness of such withdrawals and duly documenting the same on the bank’s records,” the directive said.
Non-KYC compliant account holders can withdraw only up to Rs 5,000 from their Jan Dhan Yojana account.
The move is aimed at protecting innocent farmers and rural account holders of the PMJDY from activities of money launderers and legal consequences under the Benami Property and Money Laundering Laws, the RBI release said.
These accounts had witnessed a sudden surge in deposits after the demonetisation, which was announced on 8 November, raising doubts that tax evaders are using the poor to park their ill-gotten money in them.
According to the government, total deposits in these accounts stood at Rs 64,252.15 crore as of 16 November. Bank officials in Odisha had admitted to PTI that they smell foul play in the rapid spurt in the quantum of deposits in several of these zero-balance balance accounts in Kendrapara district.
“There has been impressive growth in cash deposits in Jan dhan accounts. We obviously smell foul-play. Though a ceiling of Rs 50,000 deposit has been fixed in these accounts, we have come across accounts exceeding maximum deposit limits. The accounts with excess deposit would lose PMJDY classification. These would be converted into general savings accounts,” an official told the news agency.
Prime minister Narendra Modi, in his Mann Ki Baat on Sunday, had urged people to not make use of these accounts to whiten the black money they have.
First Published On : Nov 30, 2016 11:09 IST
Mumbai: In a bid to woo bank deposits, the RBI has said people depositing money other than the old currency will now be allowed to take out that amount on top of the stipulated Rs 24,000 weekly limit.
The Reserve Bank of India notification on Monday night is aimed at encouraging people to deposit money in their bank accounts.
“It has been reported that certain depositors are hesitating to deposit their money into bank accounts in view of the current limits on cash withdrawals from accounts,” the RBI said.
“As it is impeding active circulation of currency notes, it has been decided to allow withdrawals of deposits made in current legal tender notes on or after 29 November beyond the current limits,” it said.
Preferably, available higher denominations bank notes of Rs 2,000 and Rs 500 will be issued for such withdrawals, it added.
“Because of the current withdrawal limits, people may be holding on to cash in new Rs 500 and 2,000 or Rs 100 notes,” a RBI official told IANS.
“People are not depositing because they fear that if they do so, they will not be able to withdraw it,” the official added.
If a person deposits Rs 10,000, of which Rs 6,000 may be in old currency and Rs 4,000 in new notes or other legal tender, he can withdraw Rs 4,000 any time in addition to the Rs 24,000 weekly limit, the RBI said.
This will stand true for any amount of large deposits in legal tender made from Tuesday, the official said.
“This will be very useful for traders who receive cash in large amounts in new notes and may not be depositing it in view of withdrawal limits,” the official added.
First Published On : Nov 29, 2016 14:27 IST
On Monday, a late night press release from the Reserve Bank of India (RBI) took everyone by surprise. The release read thus: “As it is impeding active circulation of currency notes, it has been decided, on careful consideration, to allow withdrawals of deposits made in current legal tender notes on or after November 29, 2016 beyond the current limits; preferably, available higher denominations bank notes of Rs 2000 and Rs 500 are to be issued for such withdrawals”. To put it in simple words, if you deposit money in ‘acceptable’ currency denominations, you can withdraw beyond the current weekly withdrawal limit of Rs 24,000.
Now, what are the legal tenders currently?
Going by the 8 November televised speech of Prime Minister Narendra Modi, old notes of Rs 500, Rs 1,000 notes ceased to be legal tender from midnight. “To break the grip of corruption and black money, we have decided that the 500 rupee and 1,000 rupee currency notes presently in use will no longer be legal tender from midnight tonight that is 8th November 2016,” the PM said announcing one of the biggest demonetisation exercises in the country since the 1978 crackdown by Morarji Desai government.
But, the Rs 500, Rs 1,000 notes are banned only from transactions but are still ‘legal’ enough to be accepted at bank counters in the form of deposits till 30 December. The question is, Will such deposits too qualify for higher withdrawal limits or does the RBI notification refer to only deposits made in currency denominations that are in use (denominations of Rs 100 and below and new Rs 200, Rs 500 currency notes). There needs to be clarity on this aspect. Reason: If the latter is the case, the RBI is treating customers differently based on the type of notes they deposit, even though both set carries the same promise to the bearer as offered by the constitution. One customer who deposits his old currencies faces restrictions on withdrawal and the other with new currency notes gets unlimited withdrawal facility. Is that the case here? An email sent to the RBI spokesperson seeking clarity on the press release remained unanswered at the time of writing this piece.
There are two logical questions that arise:
First, at a time when currency in existing lower denominations (Rs 100, Rs 50 and Rs 10) is a luxury and the new ones (Rs 2,000, Rs 500 new notes) a rarity, why would someone deposit cash in these denominations in a bank. Those who have the first lot will preserve it for use and the second lot — who acquired them after standing for hours in long queues will be very cautious with it. Even otherwise, there are withdrawal restrictions on new currency from ATMs and bank branches. There are still many ATMs even today that have shut shop. Someone should have to be out of their minds to deposit “hard earned” money back to the bank in these times. Even those who get salary in cash (mostly low-income workers or small traders) would rather keep the cash in hand than deposit it it in the current scenario.
Second, at a time when bank branches are struggling and ATMs are gasping for cash despite the restricted withdrawals since 8 November, how can the RBI expect banks to offer unlimited withdrawal (which is what the line beyond the current limits; preferably, available higher denominations bank notes of Rs 2,000 and Rs 500) suggests. An email sent to the RBI spokesperson seeking clarity on the press release remained unanswered at the time of writing.
So far, given the withdrawal restrictions, only a fourth of the money deposited in bank branches have gone out of banks as withdrawals. Since 10 November up to 27 November, 2016 banks have received deposits of Rs 8,11,033 crore, while exchanges amounted to Rs 33,948 crore, taking the total figure to around Rs 8.4 lakh crore. As against this, the amount withdrawn by the public is Rs 2,16,617 crore from their accounts either over the counter or through ATMs.
PM Modi and economic affairs secretary, Shaktikanta Das have been dominating the demonetization episode from the beginning, not RBI governor Urjit Patel. Theoretically, the central bank is the authority on currency management and hence the governor should have played an active role by taking the public into confidence and push ahead the demonetization exercise. This is despite the fact that demonetization was primarily a political decision, not an RBI job. But, it would have been far better if the execution of the plan was effectively communicated to the public by the central bank governor, rather than a government bureaucrat. But, Patel has been behind the scenes from the beginning.
Also, there has been a serious disconnect between the RBI and the government on the implementation of demonetisation. Frequent changes in rules and broken promises have become the norm since the 8 November announcement that points to absence of coordination. In a 11 November press release, the RBI had said, “The facility for exchanging the withdrawn denominations of Rs 500 and Rs 1,000 is available for nearly 50 days. The Reserve Bank appeals to members of public to be patient and urges them to exchange their old notes at their convenience, any time before December 30, 2016.” This promise of the central bank to the public to give time till 30 December was broken when the Finance Ministry said on 24 November that beginning midnight, the exchange of old Rs 500, Rs 1,000 currency notes at bank counters would be stopped.
The Opposition parties have criticized Urjit Patel for compromising the central bank’s autonomy for his silence on the cash-crisis for over two weeks. Since then Patel has spoken to a few media houses but except for his assurances that the cash situation is under control (which is not reflected on the ground though), the central bank governor hasn’t addressed the media to offer more clarity to the public on the actual liquidity position of the banking system and how soon will the currency-crunch last.
The ball is in Patel’s court now. The governor would do well coming out of the shadows of the finance ministry and be his own man to address the public. Else, the demonetization episode will also be remembered as an event when RBI, an institution of impeccable record, compromised its functional autonomy.
First Published On : Nov 29, 2016 13:24 IST
<!– /11440465/Dna_Article_Middle_300x250_BTF –>After three weeks since the Centre announced the demonetization decision and two days after the banks reopened after the weekend holidays, queues outside banks and ATMs in the suburbs were found to be shorter on Monday though citizens complained of not getting the desired amount withdrawn.Many citizens expressed concern that they may have to continue to face the hardships owing to the cash crunch for some more days. Archita Mishra, a resident of Thane, said she felt short-changed by her bank as she could get only Rs 2,500 withdrawn over the counter. “I went to the bank to withdraw Rs 24,000 and I was quite hopeful to get it as there was no rush at all today. But my hope faded away as the bank executive told me that I could get only Rs 2,500 as the bank didn’t have sufficient currency in its coffers,” she said, adding that the banks should put up a notice informing the people of the scenario.OP Sharma, a resident of suburban Bhandup, said though the queues had shrunken substantially, the banks needed to adopt a supportive attitude towards the senior citizens. “While a few banks are making separate queues for senior citizens, State Bank of India is not mending its ways as a result of which, the elderly people are forced to stand in the line under the scorching sun. This should be corrected immediately,” said the retired Central Railway officer. He said the rush at the banks had reduced substantially since the exchange of scrapped Rs 500 and Rs 1,000 currency notes was halted.Neelam Trivedi, a Ghatkopar-based homemaker, claimed that the banks on Monday sent the people away citing liquidity crunch. “It’s good that the huge rush and serpentine queues are reducing with the passage of days, but this is also a harsh reality that the people are returning empty-handed as the banks are unable to give them sufficient money due to the liquidity problem,” she said.Recalling how people were queuing up outside banks since the wee hours to either get their old currency notes exchanged or deposited till a few days back, Trivedi said the situation had changed now.
ALSO READ PM Modi blinded by arrogance of numbers, can’t fathom people’s pain and anger: Congress on demonetization Goregaon resident Vinayak Sawant said, “I joined the queue at an ATM at 4 PM after seeing only six-seven people ahead of me. But, we could not withdraw more than Rs 2,000. I hope the situation will improve very soon.” As per the Reserve Bank of India, one can withdraw up to Rs 24,000 per week from their bank accounts, including withdrawals from ATMs.
NEW DELHI/MUMBAI The Reserve Bank of India (RBI) on Saturday unexpectedly ordered banks to deposit their extra cash with it, in a bid to absorb excess liquidity generated by a government ban on larger banknotes. Many Indians deposited their old notes with their banks after the ban on 500 and 1,000 rupee notes ($7.30-$14.60) on Nov. 8, which is aimed at tax evaders and counterfeiting.Banks had put some of this cash into government bonds, sparking a rally that saw the benchmark 10-year bond yield fall more than 50 basis points to its lowest in more than 7-1/2 years.The central bank said banks would need to transfer 100 percent of their cash under the RBI’s cash reserve ratio from deposits generated between Sept. 16 and Nov. 11, saying it was a temporary measure that would be reviewed on or before Dec. 9.Traders called it a drastic move intended to dent the rally in bond markets, adding that the RBI could have opted for more modest measures such as sucking out some of the liquidity through sales of market stabilisation bonds or telling banks to park funds under reverse repos.The action could also temper market expectations that the central bank would cut interest rates by 25 basis points at its next policy review scheduled for Dec. 7, after already easing them by the same amount at its last review in October.
“The move is more of a ham-handed one than the finesse expected from the RBI,” said Shaktie Shukla, founder of boutique investment advisory firm Kaithora Capital.”The liquidity sweep will definitely halt the down move in (bond) yields,” he added. “It will also temper the euphoria pre- RBI policy.”The move is likely to drain over 3.24 trillion rupees ($47.29 billion) from the banks, according to Reuters estimates.
Traders said bond market yields could rise 8-10 bps on Monday, given that the RBI move would deprive the key source of funding seen in the past two weeks, while banking shares would likely take a hit.Bond investors had also bet India’s demonetisation action would dent economic growth as consumers held back on purchases, raising the prospect of a rate cut by the RBI.
At the same time the bond rally had increased hopes it would lower borrowing costs in the economy and allow banks to reduce some of their lending rates.On Friday the central bank also relaxed its liquidity auction rules by expanding its basket of securities that it accepts as collateral.($1 = 68.5085 Indian rupees) (Reporting by Neha Dasgupta, Suvashree Choudhury and Savio Shetty; Editing by Rafael Namm and Mike Collett-White)
This story has not been edited by Firstpost staff and is generated by auto-feed.
First Published On : Nov 26, 2016 21:29 IST
India launches its first payment banking service. The BBC’s Suranjana Tewari explains how it will work.
New Delhi: Banned 500 and 1,000 rupee notes will continue to be exchanged for new currency at RBI counters even after the facility was withdrawn from all banks.
The government had on Thursday announced that the demonetised 500 and 1,000 rupee notes can no longer be exchanged at bank counters and any holdings will necessarily have to be deposited in bank accounts.
“The Reserve Bank of India advises members of public that exchange of banknotes in Rs 500 and Rs 1,000 denominations, whose legal tender status has been withdrawn, will continue to be available at the counters of the Reserve Bank up to the current limits per person as hitherto,” the central bank said in a statement.
The limit to exchange old notes was recently set at Rs 2,000 per person.
And the RBI said the facility of exchanging demonetised currency notes “is no longer available at other banks’ counters.”
First Published On : Nov 25, 2016 11:27 IST
I was once visited by a scholar from Ireland. He had to cross the Cricket Club of India before reaching my office, and the first thing he asked was about the “huge circus-type atmosphere” at the venue. I told him that it was an Indian wedding, and if it was at the CCI, it must be a well-heeled, big, fat wedding.
His jaw dropped. “It’s a carnival!” he exclaimed, adding that his own wedding in Dublin — which was a “big affair” — had about 40 people, including his bride and the officiating priest. It was my jaw’s turn to drop. Most poor but not indigent people have bigger wedding in India, I told him.
Now that the Reserve Bank of India (RBI) has set a Rs 2.5 lakh cash withdrawal limit for families with upcoming weddings, could this be an opportunity to make Indian weddings inexpensive and ensure a social revolution? It possibly is, though it may not have been the government’s intent when the limit was first set. When the government first announced the demonetisation drive, it hadn’t even realised it was the wedding season and people were halfway through their planning and preparation.
All the cash one might have stashed is trash now, and one has to make do with the Rs 2.5 lakh allowed till 31 December for wedding-related expenses. Already, everyone is talking about the difficulty in organising weddings with such limited provisioning, but not about devising ways and means to make them cheaper. A simpler wedding and a good marriage thereafter can be the preferred option.
The stipulation for the limited withdrawal could be an opportunity rather than cause for lament. Only parents or the person getting married can withdraw. Which implies that the limit set is per wedding, not per person getting married. The couple cannot pool their respective Rs 2.5 lakh to make it a Rs 5 lakh gala. And parents cannot chip in to make it a million-rupee event!
This should be the moment social leaders come forward and push for reforms for wedding expenses. My domestic help, who is now debt-ridden after her daughter’s wedding, recently told me that it cost her Rs 4 lakh. Most families celebrate big weddings by exhausting all their savings, though they later rue the consequences.
After all, “Shadi toh ek hi bar hoti hai na mere beti ka?”
This, of course, excludes those who have riches and oodles of cash, like the Janardhan Reddys of Karnataka, who reportedly spent Rs 500 cr on one family wedding! Had it not been for the brouhaha around the Reddy wedding, and the demonetisation said to be aimed at black money, Income Tax inspectors may not have visited the Reddy family offices.
Planned weddings cannot be called off, for that is the most embarrassing thing to happen, and even worse is when a bride or groom fails to turn up for the event. Now, one reason seems to be not having cash to disburse, because most weddings are organised mostly by cash transactions. Even the caterer takes a part by cheque, the rest in cash, like builders do. Weddings in rich families are when the kala dhan flows out.
The RBI also wants banks to “encourage families to incur wedding expenses through non-cash means — cheques or drafts, credit or debit cards, pre-paid cards, mobile transfers, internet banking channels, NEFT/RTGS and the like. But those who do go for really big fat weddings cannot do that for a while post-demonetisation, unless they cheat and build an untaxed — or tax-evaded — corpus.
Scaling down weddings and making a virtue out of a necessity is in order. Who knows, this could even set a trend. Even if Rs 2.5 lakh is withdrawn, the banker not claiming paucity of cash to honour a cheque, there are other hurdles. Cash disbursals have to be by certifying that the payee had no bank account to have received a cheque instead. There is a lot of record-keeping involved.
Just the other day, a politician on a news television debate had angrily, and unhelpfully, asked whether anyone could get married with “just Rs 2.5 lakh”. Fact is, this guy was both right and wrong. One could, but does not. Most Indians do spend more Rs 2.5 lakh for a wedding-related event. The baraat, the mehendi, the dinner spread, the decorations all need money to be organised.
But one can cut costs. The set practice today is to have a wedding with the cousin’s mother-in-law’s second cousin being invited and giving her gifts, which the receiver may have no use for. And then, with a repeat guest list, an elaborate reception with a huge dinner including a chaat counter, where everyone waits restlessly in a queue to go and meet the couple and be photographed. Who among us has ever had such a group photograph sent to us to see? The newly married couple, tired after the wedding, wearing a trousseau of some expense and unlikely the be worn ever again, except a couple of times soon after the wedding. She may have — in fact most do — added weight. After that, the weight gain makes the groom’s three-piece suit tighter at the waist.
Therefore, keeping it simple makes eminent sense. Not just for now. For all times.
First Published On : Nov 22, 2016 15:18 IST
The markets are abuzz with rumours that the Reserve Bank of India might soon announce an interest rate cut on the one hand, and that tax rates too could be expected to fall.
The first is a distinct possibility. This is because the banks are likely to be flush with deposits. They have already collected some Rs 5.45 lakh crore by way of incremental deposits – post demonetisation.
This figure could go up to Rs 9 lakh crore. Reduce from this the money that the banks will have to set aside as provisions for statutory liquidity ratios and deposits with government securities, and the banks could still be left with a net incremental deposit of Rs 6 lakh crore.
Thus money available for lending will be much more than before. So interest rates are bound to fall. Some banks have already reduced their interest rates marginally. A further reduction could not be ruled out.
The problem, however, will be to find good borrowers. None of the banks want to get into situations where non-performing assets (NPAs) swell. Hence caution will see the money being lent out only to parties that had already enjoyed decent access to funds. Medium and small scale enterprises might not get the benefit of such funds. Ditto for small self-employed individuals who trade in commodities (they sell items like bread, eggs and the like and garner cash on a day-to-day-basis).
This will mean two things. The shrinkage of funds in the markets will make things difficult for small traders, and even drive them out of business. They can survive only if customers have cash. But with large amounts of cash (approximately Rs 3 lakh crore) not being returned to banks, and hence being rendered useless, money supply is bound to shrink. This money is used to lubricate the businesses of hotels, bars, taxi drivers and petty workers.
Expect the people employed in these sectors to be out of job for some time.
That could reduce purchasing power, causing the total amount of goods (and services) sold to shrink. That reduced consumption will mean less service tax and excise duty collections for the central exchequer. If tax receipts begin to shrink, expect the finance ministry to become more hawkish on tax collections. Hence tax cuts may not come in that easily.
And where will the government use some of the money it will get? After all, it will have access to the financial reserves that the banks will set aside. That will give the government around Rs 3 lakh crore of funds. Add to this the profit that the Reserve Bank of India is likely to show by cancelling out the Rs 3 lakh crore that may not get deposited to banks. The RBI’s profits will most probably get transferred to the government as dividends. Thus the government may end up with a Rs 6 lakh crore surge in spending power.
Most people expect this money to be used as the government’s contribution towards infrastructure building. Remember, foreign funds may want a matching contribution from India. This is where the additional money will be immensely useful.
After all, the key focus of the government will also be to increase employment, to compensate for the loss of jobs demonetisation is bound to cause. That is where spending on infrastructure and related service areas (transport, tourism) will become high priority sectors for the government.
So while the collection of money looks rosy, the pressures on the government to provide for more employment will prevent it from enjoying the fruits of such monetary collections.
First Published On : Nov 22, 2016 08:11 IST
Mumbai: The Reserve Bank of India RBI on Monday imposed stiff conditions for withdrawal of up to Rs 2.5 lakh in cash from bank accounts for marriages, saying the money can be withdrawn only from the credit balance as on 8 November, the day demonetisation was announced.
While notifying norms, RBI said the cash withdrawn should be used only to make payment to those persons who do not have bank accounts and the names of such recipients should be mentioned while applying for withdrawal of the cash.
The application for withdrawal should also provide names of bride and groom, their identify proofs, addresses and date of marriage. The amount can be withdrawn only if the date of marriage is on or before 30 December, 2016.
With a view to enabling people to perform weddings of their wards, it has been decided to allow higher limits of cash withdrawals from their bank deposit accounts to meet wedding-related expenses, RBI said in a notification.
“A maximum of Rs 2,50,000 is allowed to be withdrawn from bank deposit accounts till 30 December, 2016, out of the balances at credit in the account as of close of business on 8 November, 2016,” the notification said.
“Withdrawals can be made by either of the parents or the person getting married. (Only one of them will be permitted to withdraw).”
The application for withdrawal should be accompanied by evidence of the wedding, including the invitation card, copies of receipts for advance payments already made such as marriage hall booking and advance payments to caterers.
Further, there should be “a detailed list of persons to whom the cash withdrawn is proposed to be paid, together with a declaration from such persons that they do not have a bank account. The list should indicate the purpose for which the proposed payments are being made”.
The RBI also said banks should encourage families to incur wedding expenses through non-cash means through cheques or drafts, credit or debit cards, pre-paid cards, mobile transfers, Internet banking channels, NEFT/RTGS and the like.
“Therefore, members of the public should be advised, while granting cash withdrawals, to use cash to meet expenses which have to be met only through cash mode,” RBI told banks.
Banks have been asked to keep a proper record of the evidence and produce them for verification by the authorities in case of need.
The scheme will be reviewed based on authenticity or bona fide use thereof, RBI added.
First Published On : Nov 21, 2016 21:15 IST
Banks have amassed deposits worth Rs 5,11,565 crore until 18 November after the government announced the demonetisation of Rs 500 and Rs 1,000 notes and exchanged notes worth Rs 33,006 crore, the Reserve Bank of India said in a press release today. All the notes the banks have received were in banned Rs 500 and Rs 1,000 denominations.
Earlier, finance minister Arun Jaitley had said that In the first four days until 13 5 pm, banks had received deposits worth Rs 3 lakh crore.
The government announced cancellation of legal tender of the high denomination currencies claiming it would put an end to circulation of fake notes, terror financing and also black money generation.
Ever since the measures came into force, banks, ATMs and post offices have been seeing huge crowds thronging to either exchange or deposit the banned currency notes they possess.
The government has also taken a few measures to curb any misuse of the deposit and exchange scheme by black money holders to whiten their ill-gotten wealth.
A look at the numbers released today shows that the pace of deposit accretion in the banks is slowing progressively.
While in the first four days, the accretion stood at Rs 3 lakh crore, in the next five days the corresponding figure is just more than Rs 2 lakh crore.
Observers don’t see anything fishy in the figures. Anis Chakravarty, lead economist, Deloitte, said the the surge on deposits in the first few days could be because of the initial panic.
“People might have rushed to the banks to deposit at the first instance due to panic. Over the last few days the queques have also reduced showing the worries may be subsiding. However, these figures are of least importance. What I am looking at is the final figure that the government will give out after 31 December,” he said.
First Published On : Nov 21, 2016 16:07 IST
Why has the phrase #SonamGuptaBewafa – Sonam Gupta is unfaithful – been revived on the internet?
Fri, 18 Nov 2016-05:25pm , Chennai , PTI
<!– /11440465/Dna_Article_Middle_300x250_BTF –> The Reserve Bank of India on Friday informed the Madras High Court that it cannot disclose details regarding the release of new Rs 500 denomination currency to the banks for distribution due to security reasons.The submission was made by the counsel for RBI on a petition seeking a direction to the Registrar of Co-operative Societies to follow procedures laid down by RBI relating to demonetization and permit cash withdrawal and exchange of old currencies in the societies. After recording the submission, the court posted the matter for further hearing to November 28.The High Court had on November 16 adjourned for today the hearing in the case after it sought to know from the RBI when new Rs 500 denomination currency would be made available in Tamil Nadu to ease the present cash crunch following demonetization. RBI had then submitted that it faced practical difficulties in transporting currency in view of seizure of over Rs 500 crore by poll authorities in Tamil Nadu two days before the 16 May Assembly election in three constituencies.On permitting District Central Cooperative Banks to exchange the demonetised currencies, the counsel had submitted that “the decision to ban DCCBs from exchanging notes was made apprehending malpractices”.
Moody’s affirms India’s rating, says reforms yet to produce results | Reuters
NEW DELHI Moody’s Investors Service on Wednesday affirmed India’s sovereign ratings, citing economic and institutional reforms under Prime Minister Narendra Modi, but said the measures have yet to produce enough dividends to warrant an upgrade.Moody’s becomes the second ratings agency after Standard & Poor’s to decline an upgrade to India’s ratings despite government lobbying. Moody’s rates India at “Baa3”, the lowest investment-grade rating, but with a “positive” outlook.The credit agency welcomed economic and institutional reforms introduced under Modi, saying they “offer a reasonable expectation that India’s growth will outperform that of its peers over the medium term.”However, Moody’s said “the reform effort to date has not yet achieved the conditions that would support an upgrade,” saying the country still needed to accelerate private investment in order to reduce the government’s debt burden.
Since taking office in May 2014, Modi has taken a slew of measures to control inflation, revive investments and boost economic growth. He has revamped the country’s monetary policy framework, giving the Reserve Bank of India an explicit mandate to target inflation. He is also on track to roll out a goods and services tax next April that will transform the $2 trillion economy into a single customs union.
While India has emerged as the fastest growing major economy, those initiatives have not yet succeeded in convincing cautious companies to commit to fresh capital spending. Nor have they materially improved public finances.Earlier this month, S&P affirmed India’s sovereign ratings, but ruled out any upgrade this year or in 2017 because of weak public finances and low per capita income.
S&P’s decision had caused disappointment within the Modi administration, which criticised it for not reflecting its efforts to improve economic growth and public finances. (Reporting by Rajesh Kumar Singh; Editing by Rafael Nam)
This story has not been edited by Firstpost staff and is generated by auto-feed.
First Published On : Nov 16, 2016 21:25 IST
The Indian government raises the limit on withdrawals after abolishing the 500 and 1,000 rupee notes.
The Ministry of Finance reviewed its position regarding the availability and distribution of all denominations of bank notes. According to a the ministry’s press release, in the first four days after the surprise announcement was made to demonetise Rs 500 and Rs 1,000 notes, about Rs three lac crores were deposited in the banking system and Rs 50,000 crore were dispensed to customers, by either withdrawal from their accounts at banks or from automated teller machines (ATMs). The banking system has handled transactions worth Rs 21 crore.
The Reserve Bank of India and the finance ministry are coordinating with banks and post offices continuously in order to make notes of all denominations available at all locations. Banks have also been given special instructions to ensure that all denomination notes are distributed properly and to ensure the availability of small denomination notes. Chief secretaries of the states have been requested to identify the rural pockets, if any, where availability of cash has been a problem and provide all support to the banks and Post Offices in order to ensure the last mile distribution of small denomination of notes is done through mobile banking vans and Banking Correspondents(BCs).
The issuance of the new Rs 500 notes has already commenced.
The ministry and RBI have taken cognisance of the matter that certain business houses like hospitals, caterers etc. are not accepting cheques or demand drafts and are requesting online payment transfer from customers. In such cases, customers should make complaints to the district magistrates/district administration who will take suitable action against the service providers.
Mobile banking vans
Government of Assam has arranged for Mobile Banking Vans with support of banks and state government staff at certain hospitals for carrying out emergency banking transactions. All banks have now been advised to arrange mobile banking vans to the extent possible at major hospitals to carry out emergency banking transaction for patients.
Senior citizens get separate queue
Banks are supposed to make separate queues for senior citizens and disabled persons. In addition to this, separate queues will also be arranged for exchange of cash to cash and transactions against bank accounts.
Increased limits on withdrawals
Business correspondents can now withdraw up to Rs 2,500. Now, you can exchange Rs 4,500 from the existing Rs 4,000 over the counter. At re-calibrated ATMS, you can withdraw up to Rs 2,500 per day. Weekly limit of Rs 20,000 has now been increased to Rs 2,4000. The limit of Rs 10,000 per day has also been removed.
More mobile wallets and debit/credit cards
Banks have been advised to increase the issuance and use of mobile wallets and debit/credit cards and to provide them to those customers and establishments not having access to these non-cash means of payment.
First Published On : Nov 13, 2016 21:05 IST
RBI asks banks to furnish daily data on cash withdrawals | Reuters
MUMBAI The Reserve Bank of India (RBI) asked banks to submit daily amounts of cash withdrawn from over the counter as well as through automated teller machines to help it gather accurate data on the circulation of currency. In a circular on Sunday it asked banks to submit the data in a specific format in contrast to lenders sending it fortnightly.
The RBI and the government have been trying to assuage public anger after Prime Minister Narendra Modi abruptly decided to withdraw large denomination notes in an attempt to uncover many billions of dollars in undeclared wealth. [nL4N1DE05K][nL4N1DD05L]
(Reporting by Suvashree Dey Choudhury; Editing by Elaine Hardcastle)
This story has not been edited by Firstpost staff and is generated by auto-feed.
First Published On : Nov 13, 2016 18:38 IST
New Rs 500 notes will be introduced in Delhi, Mumbai and Bhopal today, according to a report in News18.com citing finance ministry officials.
Some of the State Bank of India ATMs have been recalibrated and may start dispensing these notes, the report said.
Until now, the ATMs have been dispensing Rs 100 notes as the dimensions of the new Rs 500 and Rs 2,000 notes are different and all the 2.15 lakh ATMs in the country needs to be recalibrated.
Finance minister Arun Jaitley had yesterday at a press conference said that the recalibration of the ATMs will be completed only in 3 weeks.
As the there is a limit to the number notes an ATM can hold, the replenished notes are getting over in no time, leading to long queues in front of the kiosks. Once the new Rs 500 notes are loaded, it will be a relief to the customers.
A report in The Times of India today said that the Currency Note Press, Nashik, (CNP) has dispatched the first batch of 5 million Rs 500 notes.
According to an official quoted in the report, the CNP will dispatch another five million pieces by Wednesday. The press is also printing Rs 20, Rs 50 and Rs 100 notes.
Meanwhile the Reserve Bank of India has in a message on its website that it has enough cash available with it to meet the demand and the public need not hoard it in large numbers.
“The Reserve Bank assures members of the public that enough cash in small denominations is also available at the Reserve Bank and banks. The Reserve Bank urges that public need not be anxious; need not come over to banks repeatedly to draw and hoard; Cash is available when they need it,” the message said.
First Published On : Nov 13, 2016 17:27 IST
The Reserve Bank of India has said in a statement today that there’s enough cash available with banks and all arrangements have been made to reach the currency notes all over the country. The apex bank urged public to exercise patience and exchange notes at convenience.
The central bank said it may take a while for the banks to recalibrate their ATMs; once the ATMs are functional, members of public will be able to withdraw cash from ATMs. Until 18 November, customers can withdraw a maximum of Rs 2,000 per card per day and after that up to Rs 4,000 per day per card.
The RBI says that several ATMs have started functioning from this morning as the banks could complete recalibration of these machines to allow withdrawals up to Rs 2000 to begin with.
However, we visited 12 ATMs so far in Byculla and Mazgaon area in South Mumbai. None of the ATMs, especially the stand alone ATMs had any money in it. Even ATMs at bank branches, the ATM section had shuttered down along with loads of people trying to get into the bank. Some ATMs even had a shutters down and some didn’t even have security guards. People were constantly getting disappointed.
One ATM security guard said he has pulled the shutter down since there isn’t any cash. Watch the video to see the whole story.
First Published On : Nov 11, 2016 17:13 IST
People outside India holding discontinued 500 and 1,000-rupee notes face problems, the BBC finds.
<!– /11440465/Dna_Article_Middle_300x250_BTF –>Welcoming the government?s decision to ban currency notes of Rs. 500 and Rs 1000 from tomorrow, Bharatiya Janata Party (BJP) president Amit Shah described the war on black money as being no less than a surgical strike.”I welcome the decision of the government to ban Rs. 500 and Rs. 1000 notes. On behalf of the Bharatiya Janata Party (BJP), I congratulate the Prime Minister for taking such a brave step. This fight against black money will continue. Decisions like forming SIT were earlier taken for the same,” Shah said.Shah said Prime Minister Narendra Modi is taking forward the battle against corruption and black money. “I believe his step against black money is no less than surgical strike. It will not only be a problem to those keeping black money, but also give a major blow to those indulging in the business of fake currency. It will give a strong message to those having black money,” he added.In an unexpected address to the nation, Prime Minister Modi last night announced that from November 9, 2016, existing Rs. 500 and Rs. 1,000 notes will no longer be legal tender. Describing the move as essential to fight “the disease of black money?, Prime Minister Modi said all such currency notes must be deposited in banks and post offices starting Thursday (November 10) and through till December 30. A proposal for issue of new Rs. 500 and Rs. 2,000 notes has been cleared by the Reserve Bank of India (RBI).”Your money will remain yours…you need have no worry on this account. The new notes will be in limited supply at first and will then be increased,” Prime Minister Modi said.
Mumbai: Hours after Prime Minister Narendra Modi announced the demonetisation of high-value notes, the Reserve Bank on Tuesday issued new series of notes for the Rs 500 and Rs 2,000 denomination with improved features and newer sizes.
The Rs 2,000 note, which is a first under the denomination, will be called the ‘Mahatma Gandhi (New) Series’ and has the motif of the low-cost mission to Mars, the Mangalayan, on the reverse, the RBI said.
The base colour of the note will be magenta and the size of the note will be 66 mm by 166 mm, it said.
The new design in the Rs 500 denomination will be in a different colour, size, theme, design and location of security features, it said.
The note, measuring 63 mm by 150 mm will be in a new colour — stone grey and the predominant theme will be Delhi’s Red Fort, it said.
Both the new designs, Rs 500 and Rs 2,000, will be very friendly towards the visually-impaired by having features which make it accessible for all sections.
Earlier, Governor Urjit Patel said that the central bank has ramped up production of the new series of notes under the newer series.
The RBI has also started a helpline number for the citizens who may face any difficulties, economic affairs secretary Shaktikanta Das said.
Citizens can reach out to the RBI on 022-22602201, 022-22602944 starting on for any doubts and clarifications, he said.
New Rs 2,000 note, Rs 500 and Rs 1,000 banned, withdrawal limit set: Key points from PM Modi’s address
Announcing the discontinuation of existing Rs 1,000 and Rs 500 notes with effect from midnight on 8 November 2016, the Narendra Modi government has outlined following steps to make it easier for citizens for the transition:
1. In the next 72 hours —
- Government hospitals will continue to accept old Rs 500 and Rs 1000 notes for payments.
- Ticket booking counters of railway, government busses and airlines counters at airports will accept the old notes for purchase of tickets.
- Petrol, diesel and gas stations authorised by public sector oil companies to accept old notes.
- Consumers cooperative stores authorised by state or central government, state government authorised milk booths will accept the old Rs 500 and Rs 1,000 notes.
- Crematoria and burial grounds will also accept the old notes.
2. In order to exchange the old notes, public can —
- Deposit the old notes of Rs 500 and Rs 1,000 in banks or post office accounts from November 10, till December 30, 2016 without any limit.
- There will be a limit on withdrawal of Rs 10,000 per day and Rs 20,000 per week. This limit will be increased in the coming days.
- ATMs will not work on 9 -10 November.
- In the first few days there will be a limit of Rs 2,000 per day per card. This will be raised to Rs 4,000 later.
- Exchange old notes of Rs 500 and Rs 1,000 at any bank or head post office or sub-post office amounting to Rs 4,000 while showing ID proof up to 24 November.
- No restriction of any kind of non-cash payments by cheque, demand draft, credit cards and electronic fund transfer.
With inputs from PTI
The Reserve Bank of India (RBI) on Tuesday cut its key lending rate, repo, by a quarter percentage point or 25 basis points to 6.25 percent. This is the first policy where the rate decision is taken by the monetary policy committee (MPC). For Urjit Patel too, this is the first policy as RBI governor.
Since January 2015, the RBI has cut the repo rate by a cumulative 150 bps. The Consumer Price Inflation (CPI) trajectory had indicated room for the RBI for a rate cut. At the last reading (in August), the CPI inflation fell to 5.05 percent compared with 6.07 percent in July.
The RBI has set March 2017 target of 5 percent for inflation. Economists have been saying that inflation might well fall further down going ahead, given that monsoons this year have been favourable, enabling better crop output. Food price inflation, the main villain in the inflation story, has eased considerably in the recent past, giving room for further rate cuts.
However, most economists expected the RBI to postpone the rate cut to December, considering the persisting upside risks to inflation, including the impact of 7th pay commission and chances of unseasonal rains.
Read full policy statement here
India appoints a government insider as the new head of its central bank. Can Urjit Patel emerge from his predecessor “rock star” Raghuram Rajan’s shadow?
<!– /11440465/Dna_Article_Middle_300x250_BTF –>Speaking on the appointment of the new Reserve Bank of India (RBI) Governor, Congress leader Veerapa Moily today said Urjit Patel has institutional experience and is highly professional and farsighted, and this will definitely take the Indian economy on the new progressive path.”The choice is excellent and superb. This is what we want for that post. This is an acknowledgement of the fact that the government has recognised the importance of ‘institutional RBI Governor’ and Patel is a far sighted person and an economist. The kind of reform measures that he has contemplated and has given report is excellent. We are looking forward for better days for the country’s economy and also for the RBI,” he told ANI.He further said Raghuram Rajan’s exit will be a great loss as he is an economist of international fame; perhaps Patel will make it up.”He has to work freely because the RBI Governor has to work as autonomous body and has to work independently, that is how we have to take the country forward. I hope Patel will come up to the expectation,” he added.On Finance Minister Arun Jaitley’s statement on former prime minister Jawaharlal Nehru, he said, “I don’t know as to laugh or feel pity on Jaitley and the BJP government for lacking institutional memory. I don’t think if Advani or Vajpayee talked of that. Many BJP leaders make a very low the belt remark on Nehru legacy. The Narsihma Rao government has uplifted the economy in the past, which was left by the then finance minister Yashwant Singh. He had left the economy in complete bankruptcy; the credit will go to the Congress government of that time, particularly Dr. Manmohan Singh, who was the then finance minister, for lifting the economy of India to the international level.”The Government on Saturday appointed Urjit R.Patel as the new Reserve Bank of India (RBI) Governor.Patel, who is currently serving as the Deputy RBI chief, will succeed Raghuram Rajan as the RBI chair once he steps down on September 3 after his term comes to an end.Dr Rajan surprised everyone with a letter to RBI staff announcing his decision to return to academics and not be available for a second term.The committee undertook an extensive exercise to suggest a panel of names to the ACC. One of the RBI’s four deputy governors, Patel, 52, was reappointment in January for another three years. He has run the central bank’s monetary policy department since 2013.
<!– /11440465/Dna_Article_Middle_300x250_BTF –>The Centre has set up an inter-ministerial group to regulate the collection of illegal money through Ponzi schemes and the experts body will identify the gaps in the existing regulatory framework for deposits taking activities.It will draw the lines for clear demarcation between regulated and unregulated schemes. In addition, it will also suggest the legislative and administrative measures to the regulators.Informing the Supreme Court that the experts committee has been set up in the Department of Economic Affairs, the Corporate Affairs ministry said the committee was set up in pursuant to the recommendations of the Securities and Exchange Board of India (SEBI).Besides, the ministry said the Reserve Bank of India (RBI) has also set up state level co-ordination committees to prevent misuse of the money collected from the people falling in the lower income category.The government has filed its reply on a PIL, filed by one civil society –Humanity Salt Lake seeking direction to bring mechanism to prevent illegal collection of money particularly through chit funds and other Ponzi schemes.Earlier, SEBI had suggested to set up an experts committee saying due to multiplicity of the regulators and lack of clarity in the legal provisions, some entities have taken advantage and collected money illegally from people in violation of the laws.The Centre also told the court that the prosecution have been launched against the people who were involved in the chit fund scam. The Apex Court is likely to take up the PIL next week.
<!– /11440465/Dna_Article_Middle_300x250_BTF –>Ending two months of intense speculation, the Union government on Saturday appointed Urijit Patel as the 24th governor of Reserve Bank of India (RBI) for a period of three years. Patel, seen as a close aide of outgoing governor Raghuram Rajan and deputy governor in charge of monetary policy, will assume office on September 5, a day after Rajan’s term ends. He will be one among the few governors – after Manmohan Singh and Raghuram Rajan – to be appointed to the top post from outside the IAS circle.How did the scales tilt in favour of Urijit Patel when there were equally qualified experts like Arvind Subramanian, chief economic advisor, or Shantikanta Das, economic affairs secretary? Was he handpicked by Prime Minister Narendra Modi himself? Of course, opinion among economists, bankers and other stake-holders are divided on these counts, though most experts opine that probably the government wanted a continuity in the monetary policies and didn’t want any disruptions by bringing in a new candidate.The challenges before the new governor, however, would be to continuing to keep his grip on inflation, helping banks in strengthening their balance sheets and bringing in regulations that will ensure the stability of the financial system. Many believe that 53-year-old Patel’s prime focus will be to keep the galloping inflation under control though a granular surveillance on the interest rates. Urijit Patel, deputy governor since January 2013, has been a key figure in framing the monetary-policy framework that set food price inflation as the target for tackling inflation rather than focus on whole sale price inflation, which gave more weightage to industrial production. Arundhati Bhattacharya, chairman, SBI said, “Dr. Patel has been at the helm of instiutionalising the inflation targeting regime in the monetary policy framework. His appointment signals continuity of policy intent both on the part of RBI and the government.”The six-member rate setting committee will be set up shortly after the government appoints its three members. In the new role, Urijit Patel will have the flexibility to implement the policies on inflation and interest rates that he helped to formulate. And he takes over at a time when retail inflation and the whole sale inflation have both overshot expectations at 6.07% and 3.55% respectively.Ashutosh Khajuria, executive director, Federal bank said, “Patel is seen as Rajan’s lieutenant and the government wants to see continuity. It was his paper on monetary policy recommendations that set CPI as inflation target and the government has notified a 4% medium-term inflation target (with tolerance levels plus or minus 2%) has now become a legislation endorsed by the parliament. So his credentials as a economic policy expert is impeccable.” Chanda Kochhar, MD and CEO, ICICI Bank said, “His appointment would ensure a smooth transition and continuity in monetary policy, as India puts in place major structural reforms to transition to a higher growth path.”Patel, who completed his graduation programme from the London school of economics, has an MPhil from Oxford University and a doctorate in Economics from Yale university (1990). His previous assignment included terms with the International Monetary Fund (IMF), the Brookings Institution at Washington and the Massachusetts-based Boston Consulting Group and Reliance Industries and non-executive director of the multi-commodity Exchange of India Ltd.Patel will contribute to India’s growth story: JaitleyFinance minister Arun Jaitley exuded confidence that Urjit Patel will contribute to India’s economic development as the next Reserve Bank governor. “I’m sure he will successfully lead the Reserve Bank & contribute to India’s economic development,” Jaitley tweeted congratulating Patel.It’ll be idiotic to attack Patel: Subramanian SwamyUrjit Patel’s appointment appeared to have support of BJP MP Subramanian Swamy who had launched a series of attacks against the outgoing governor Raghuram Rajan. In a string of retweets and replies to his Twitter followers, Swamy said it will be utter “idiotic” to think he will attack Patel because he was born in Kenya.When one of his followers criticised Patel for being a Kenyan national, Swamy replied: “He is not a Kenyan citizen, but was. R3 was born Indian and chose to continue his US green card even though in India from 2007.” R3 is the acronym he uses for referring to Raghuram Rajan.
The Reserve Bank on Thursday said it will accept pre-2005 banknotes only at its select branches from Friday as majority of the old series banknotes have been withdrawn. RBI is pulling out the pre-2005 banknotes because of fewer security features compared to banknotes printed after 2005.The central bank said it has observed that a major portion of the pre-2005 banknotes have been withdrawn from circulation and only a small percentage of these notes remains in circulation.<!– /11440465/Dna_Article_Middle_300x250_BTF –>”On a review, therefore, the Reserve Bank has decided that from July 1, 2016 the facility of exchanging the pre-2005 banknotes will be available only at the select offices of the Reserve Bank,” it said in a release.The branches are: Ahmedabad, Bengaluru, Belapur, Bhopal, Bhubaneswar, Chandigarh, Chennai, Guwahati, Hyderabad, Jaipur, Jammu, Kanpur, Kolkata, Lucknow, Mumbai, Nagpur, New Delhi, Patna, Thiruvananthapuram and Kochi.Reserve Bank in December 2015 had set June 30, 2016 as the last date for public to exchange pre-2005 banknotes at the identified bank branches and Issue Offices of the Reserve Bank. RBI also clarified that these pre-2005 banknotes will continue to remain legal tender. Further, RBI said it is a standard international practice that not to have currency notes from multiple series remaining in circulation at the same time.Soliciting cooperation from public in withdrawing these banknotes from circulation, RBI has urged them to exchange pre-2005 banknotes at its mentioned offices as per their convenience.”The Reserve Bank will continue to monitor and review the process so that the public is not inconvenienced in any manner,” it said.
Bengaluru: Reserve Bank of India Governor Raghuram Rajan on Wednesday said startups lacking collateral is the main reason for not being able to get funded by banks.
“Across the world startups don’t have collateral. The banker wants to see what he can take as a collateral which is non-existent for the startups,” said Rajan at an interactive session organised by industry body Assocham.
Rajan said those who want to start a taxi service can go take a loan against the fleet of cars they have as security but for startups that is not the case.
He said a bank will lend to a kirana shop owner or an auto repair shop owner but shy away from startups for the reason they do not have assets or collateral.
The governor said a software programme written by a startup hanging around somewhere in the cloud might be hard for a bank to readily understand its value and thereby lead to backing off from funding.
However, Rajan highlighted that startup funding in India exploded 30 to 40 times through a variety of sources like venture capital and angel funding among others.
As India seeks a new Reserve Bank of India (RBI) chief, many investors are pushing a clear message: the successor to Raghuram Rajan may lack his gravitas, but must defend the Reserve Bank of India’s autonomy at a critical juncture in its history.
Under Rajan, who unexpectedly announced on Saturday he would step down when his tenure ends in September, the RBI has started to institutionalise its decision-making and reduce the power of the governor, including through the introduction of an inflation target that will guide monetary policy decisions.
But Rajan’s announcement, in a letter to staff, has spread confusion and stunned RBI and government officials.
It also follows strident criticism of Rajan from right-wing members of Prime Minister Narendra Modi‘s Bharatiya Janata Party, prompting investors to ask whether politics played a role in his departure.
That is putting the question of the RBI’s autonomy front and centre, especially as Rajan may not get to see through the next plank of his reform plan – the creation of a monetary policy committee to set interest rates, which was passed into law last month but whose final composition has yet to be announced.
The RBI is not statutorily independent from the government but has long enjoyed wide latitude.
“The choice of successor must be based on finding a leader that will continue the new monetary project, targeting lower inflation,” said the head of portfolio management for emerging Asia at PIMCO, Luke Spajic, who sees finding the right mix of experience, deft thought leadership and personal charisma that satisfies all camps as a daunting challenge.
India can ill afford to pick wrong or drag its feet on a replacement. It has attracted more than $60 billion in foreign portfolio investments since Rajan’s appointment in September 2013 and some investors could start getting skittish.
“Investors abhor vacuums, especially at central banks,” said Spajic.
Deputy Governor Urjit Patel is currently seen as a top contender, a decision that would likely mollify investors because he penned the report that laid out recommendations for the new monetary policy framework adopted by Rajan.
The final decision is expected to be taken by Modi himself, and a source close to the Prime Minister said an independent successor would be picked.
“He (Modi) does not want to give the job to a conservative economist, and clearly wants an independent thinker. The new governor will not be a puppet in the hands of the government,” he told Reuters.
Nonetheless, questions linger as India transitions to letting a new monetary policy committee set rates.
Under the current six-member structure agreed by Rajan and the government and written into law, three members would come from the RBI, including the Governor. The other three will be nominated by a government panel although the Governor would have a say in the selection.
However, the Governor would have the tie-casting vote in monetary policy decisions, meaning Rajan’s successor would face more pulls and pressures.
Still, a senior policy maker who works closely with Rajan said all RBI governors have ultimately proven to be independent as they conform to an institution that has long taken pride in its autonomy.
“It is the chair (of the RBI Governor) which is the prime driver, not who employs you,” he said.
Indian central bank governor Raghuram Rajan’s abrupt decision to quit came as he increasingly felt he lacked support from his political bosses Finance Minister Arun Jaitley and Prime Minister Narendra Modi, according to friends and colleagues. A newspaper report a week ago that a selection panel would consider a field of candidates rather than directly offer the former IMF chief economist an extension to his three-year term, effectively forcing him to reapply for his own job, may have been the final straw, according to these people and a finance ministry source.<!– /11440465/Dna_Article_Middle_300x250_BTF –>”He felt it would belittle the position of the RBI governor if he had to appear before the committee,” said one senior commercial banker who knows Rajan personally but had not spoken to him since his decision.”It would reveal a lack of government support. Rather than have two more years of constant quibbling, he decided to go.”The darling of international investors was also upset that Jaitley had not backed him more strongly after criticism from Hindu nationalists of both his policies and his perceived lack of “Indian-ness”, the sources said.Rajan joked when he took over the top job at the Reserve Bank of India in September 2013 that he wasn’t expecting to win any votes or Facebook ‘likes’ in the position.But the hostility he had faced of late from elements of Modi’s ruling party was evidently greater than he had counted on, the sources said.When Rajan decided to leave, he did so without warning and on his own terms: in a sign of growing tensions he did not inform top members of the government before releasing an open letter to staff on Saturday, a move that took investors and the government by surprise.NO CONTACTIn his letter, Rajan said he had been open to seeing through changes he championed such as the creation of a monetary policy committee to set interest rates and a clean-up of the banking sector.But he added: “On due reflection, and after consultation with the government, I want to share with you that I will be returning to academia when my term as governor ends on Sept. 4, 2016.”Rajan was not available for comment but will face questions on the motives for his abrupt withdrawal at a speaking engagement on Monday afternoon in Mumbai. Less than two weeks ago, he laughed off speculation about his future after an RBI policy meeting, saying: “You will know when there is news.”Five sources familiar with the matter said Rajan had not contacted Modi’s office directly. Nor was a meeting or discussion between the two planned, said one senior official. Modi has not commented, tweeting instead on Sunday about the forthcoming World Yoga Day. Jaitley had been in his office on Saturday and gave no indication of concern about Rajan’s future, leaving for home before the news broke, an aide said.The finance minister tweeted after a delay of more than two hours that he respected Rajan’s decision.It was unclear whether Rajan had briefed senior staff at the Reserve Bank of India since his bombshell decision.”I am surprised,” said one person who has worked with Rajan and who spoke on condition of anonymity. “A week back he was sounding very much interested in serving a second term.”SAFFRON POSSERajan had for weeks faced intense pressure from Subramanian Swamy, a politician in Modi’s Bharatiya Janata Party (BJP) who, say sources familiar with the matter, was acting with the backing of the Hindu-nationalist umbrella group to which the BJP is affiliated, the Rashtriya Swayamsevak Sangh (RSS).Swamy, a 76-year-old former Harvard economist with a record of aggressive anti-corruption litigation, wrote an open letter to Modi a month ago accusing Rajan of being “mentally not fully Indian” and calling on the prime minister to “terminate” him with immediate effect. The broadside from Swamy came soon after he was handed a seat in India’s upper house of parliament by the ruling party, creating the impression that he was acting on good authority.Challenged to respond to Swamy, Jaitley merely said that Rajan’s candidacy should not be discussed publicly. “As a colleague I could see he looked hurt,” said one senior policymaker who works with Rajan. “You can question my efficiency, but if you question my loyalty to my job, then one would expect your employer to stand up and defend – and not stay silent.” Yet it was Rajan’s own forays into politically sensitive territory that led the Hindu right to target him – in particular over a speech last October to students in Delhi in which he said that social tolerance was vital for a country’s development.
Raghuram Rajan, the governor of India’s central bank, is to step down in early September at the end of his term.
Raghuram Rajan will not be either getting another term or will not be accepting another term as RBI Governor. India will have to get a new RBI Governor from 4 September, when Rajan will return to Chicago University to resume as a tenured professor in the University of Chicago’s vaunted economics department. India’s loss will be Chicago’s gain.
It will be difficult to replace him with another person of acumen, personality, experience, accomplishment and world stature. Most of our previous RBI Governors were mere flunkeys who let the nations banking and financial system drift towards the abyss. Rajan red flagged the NPA’s and the capital inadequacies of the PSU banks, and began moves to set things in order.
I can be sure that there would be much relief spreading through many of our corporate headquarters, most of all of many corporate chieftains who are in the Prime Minister’s Councils of Advisors on the Economy, Infrastructure etc.
I am also sure there will be much relief in the upper echelons of our state owned banks, where many actively took part in the malfeasances that left the banks deep in the red. Many of these people owe their positions to the crony capitalists who greased the palms of the powers that be to position their soon to be benefactors in positions of authority.
So there will be rejoicing among many in the upper echelons of the CII, FICCI and Assocham, and the 14 state-owned banks. Investments made and promises made will now be kept.
During my recent travels abroad addressing groups of economists and industry leaders interested in India, almost the first statement one heard was one hoping Rajan would stay.
We will no doubt get another RBI Governor, like we got a Pahlaj Nihalani at the Censor Board or Chetan Chauhan at NIFT and Ram Bahadur Rai at IGNCA. Maybe one who finds the approval of Subramanian Swamy and his mentor Chandra Swamy. While we are it, why not Dr Swamy as RBI Governor? He has the qualifications and the acumen required to do the job required.
This noise and dust kicked by the likes of Swamy and others only goes to prove that India is no place for good people. Its good for only the Swamy’s of the world.
As posted by Mohan Guruswamy on Facebook. Guruswamy heads the Centre for Policy Alternatives, New Delhi.
New Delhi: Amid BJP MP Subramanian Swamy stepping up his tirade against Raghuram Rajan, Finance Minister Arun Jaitley on Thursday said he does not approve of “personal comments” against anyone including the RBI Governor.
“I don’t approve of personal comments against anyone, let alone the RBI Governor,” the minister said when asked about the continuing attack on Rajan in past few months and whether there was an effort on part of the government to ring-fence the Governor.
The Reserve Bank, Jaitley said, is an important institution which makes its own judgement.
“One can agree or disagree with their judgment, but that’s a debate on issues. But I don’t think we should allow a public discourse where instead of debate on issues we concentrate on debate on persons,” he told NDTV.
In separate letters to Prime Minister Narendra Modi within a fortnight, Swamy has sought immediate dismissal of the RBI Governor alleging that Rajan was “mentally not fully Indian” and has “wilfully” wrecked the economy by keeping interest rate high.
Swamy also accused Rajan of sending confidential and sensitive financial information around the world.
Jaitley said RBI and the government are in continuous dialogue and that relationship will continue.
“And I hope from the later part of this year, the Monetary Policy Committee will get into action and therefore, both the bank and the government nominees will have to sit together and decide monetary policy,” he said.
Rajan’s tenure is scheduled to end in early September.
To a question on views of certain corporate leaders that the rupee will crash and economy will face crisis if Rajan is removed as RBI Governor, Jaitley said there was no need for him to comment.
“I think in democracy debate of every kind takes place. Now people make comment one way, somebody else makes the other way. I read those comments, its not necessary for me to express views on those comments,” he said.
On a question that should RBI Governor remain conservative and publicly shy, Jaitley said it all depends upon individuals.
“It depends on persons. Even among ministers you will have people who express themselves freely…you can always have personalities which keep to themselves and just read statements.
“There are others who go out and speak. I am a minister and go out and speak on subjects which don’t concern my ministry also. I can’t preach to the world that don’t go and deliver lectures because…I do a lot of it myself,” he said.
As an outspoken RBI Governor, Rajan has expressed his views on host of issues, including intolerance and has even described India as ‘one-eyed king’ in the land of blind in reference to the country’s high economic growth.
Questioning Prime Minister Narendra Modi’s silence over Bharatiya Janata Party (BJP) leader Subramanian Swamy’s tirade against Reserve Bank of India (RBI) governor Dr Raghuram Rajan, the Congress has asked if it has something to do with his position on making the names of all wilful defaulters public.Describing Swamy’s attack on the RBI governor as the most vicious assault on the institutional mechanism in India, Congress spokesperson Manish Tewari said: “Why is the Prime Minister silent? Why has the Prime Minister not come out and spoken on the attack on the governor of the central bank that is unprecedented?”<!– /11440465/Dna_Article_Middle_300x250_BTF –>Stepping up the attack on Dr Rajan, Swamy, also a well-known economist, had asked the PM to sack the RBI governor in ‘national interest’. In a letter to the PM, Swamy not only accused Rajan of making ‘wilful and deliberate attempt to wreck the Indian economy’ but also argued that being a Green Card holder of the US he was ‘mentally not fully Indian’.In his letter, Swamy argued that Rajan’s concept of containing inflation by raising interest proved disastrous and also alleged that it was Rajan’s decisions that were responsible for doubling of non-productive assets (NPAs) in the public sector banks to Rs 3.5 lakh crore in the last two years.Raising the same issue, Tewari said: “Does the attack on the RBI has got something to do with the drive to get public sector banks to declare the quantum and extent of non-performing assets to get their NPAs on their balance sheets? Is it not worrying some very, very important crony capitalists in this country and their benefactors in the government that an institutional decision has been taken to hound the RBI governor out?”
MUMBAI Indian banks would have to make higher provisions for lending to large corporate borrowers above a certain level from next financial year, according to proposals published by the Reserve Bank of India (RBI) on Thursday.
The proposals were set out by the central bank in a discussion paper and aimed at “mitigating the risk posed to the banking system on account of large aggregate lending to a single corporate”, according to the document.
“Absence of an overarching ceiling on total bank borrowing by a corporate entity from the banking system has resulted in banks collectively having very high exposures to some of the large corporates,” it said.
The framework would come into effect in the financial year beginning April 2017, and apply to all banks in India as well as branches of Indian banks abroad, the RBI said. bit.ly/1s0KiXj
(Reporting by Devidutta Tripathy; Editing by Dominic Evans)
This story has not been edited by Firstpost staff and is generated by auto-feed.
A mail van heading towards Patel Chowk was completely damaged when it suddenly caught fire near the Reserve Bank of India building in New Delhi on Monday evening.According to fire officials, the incident took place around 5.40 pm in Sansad Marg and the driver of the van stepped out of the vehicle when he saw smoke emanating from the engine.Several fire tenders were rushed to the spot and the area was cordoned off by the police. The operation is underway, the fire official added.
1. Japan twin earthquakes: At least 29 dead in Mashiki; many trappedThe Japan Meteorological Agency initially said the Saturday quake was 7.1 magnitude, but later revised it up to 7.3. The quake was 22 times more powerful, in terms of energy released, than Thursday’s shock, according to the USGS website. Read more here<!– /11440465/Dna_Article_Middle_300x250_BTF –>2. Delhi: Major fire breaks out in Dwaraka slum clusters, 400 huts guttedA major fire broke out in slum clusters of Dwaraka Sector-3 area following which 20 fire tenders were pressed into service which took one and half hour to douse the flames. Read more here3. Indian economy like ‘one-eyed’ king in land of blind: Raghuram RajanWith India being often described as ‘the bright spot in the global economy’, Reserve Bank Governor Raghuram Rajan sees this as a case of “the one-eyed man” being king in the land of the blind. Read more here4. India to face Australia in Sultan Azlan Shah Cup final todayIndia will take on Australia in the final of Sultan Azlan Shah Cup hockey tournament at Ipoh in Malaysia on Saturday as India stormed into the final yesterday evening beating Malaysia 6-1. Read more here5. Here’s something you didn’t know about Shah Rukh Khan’s ‘Fan’ ‘Fan’ released to rave reviews. Director Maneesh Sharma talks about shooting the movie. Read more here