indianeconomicpanorama
44 News the Newsbehind JULY 08, 2019it answers, according to the Business
Line. For instance, noting that market
borrowings via debentures have been
drying up for NBFCs/HFCs, it fi nds
that banks are now larger funders
of NBFCs. However, the report also
observes that 80 per cent of bank
exposures to NBFCs are concentrated
in the top 30 names, begging a
question on how the remaining 9,600-
odd non-banks are meeting their
liquidity needs.
Presenting data on delinquencies
in loans given out by banks vis-a-
vis NBFCs/HFCs, it concludes that
NBFCs have an ‘adverse selection’ bias.
But the fact that NBFCs lend to riskier
segments of borrowers is already well-
known. Th e question now is whether
their risk management practices are
robust enough to ward off solvency
risks.
Overall, while the report does a
thorough job of diagnosing the weak
spots lurking in the fi nancial system,
it disappoints by not suggesting
cures. The tone of the report also
gives the impression that the RBI, at
this juncture, given its dual roles as
the regulator of non-banks and the
custodian of fi nancial sector stability,
is torn between taking a critical view
of its constituents and soothing the
market’s frayed nerves.
RBI was slow to act: former RBI
Governor: Meanwhile, Urjit Patel,
former Reserve Bank Governor,
speaking at an event in Stanford
University, has admitted that failure
on the part of banks, the government
and the regulator till 2014 has got
India into the current bad loan mess
and the resultant low capital buff ers.
After 2014, the RBI started an
asset quality review, which led to
the recognition of the huge pile
of hidden stress in the system and
resolution through the introduction
of bankruptcy laws. Th ese actions led
to a sharp decline in banks’ ability to
fund the needs of the economy, where
growth has been sagging.TRADE
INDIA’S WIN AT RCEP
In a major victory for India and
other developing countries, three
harmful provisions concerning
pharmaceuticals and agriculture —
which were part of the Regional
Comprehensive Economic Partnership
(RCEP) free trade agreement — have
been withdrawn.
Rupali Mukherjee, writing in the
Economic Times understands the
provisions were withdrawn after India
argued against provisions of patent term
extensions and data exclusivity, which
would impact public health and access
to aff ordable medicines in developing
countries by creating monopolies.
Billed as the biggest trade agreement,
negotiations at RCEP have reached a
crucial stage as representatives from
16 countries are in Melbourne for
the last few days, aiming to close the
deal by year-end. If concluded, RCEP
would be the world’s largest trading
bloc — home to nearly 50% of the
global population, and around 30%
of global trade.
Initiated in 2012, it covers 10
Asean countries (Brunei, Cambodia,
Indonesia, Laos, Malaysia, Myanmar,
Philippines, Singapore, Thailand
and Vietnam) and trading partners
Australia, China, India, Japan, Korea
and New Zealand.
Th e provisions, if adopted, would
have led to domestic pharma companies
not being able to launch or export
aff ordable life-saving drugs across the
world. While in the agriculture sector,
farmers would lose the right to save or
sell seeds or the harvested produce from
plant varieties that have been granted
intellectual property.Ph: +91 9810622100
Fax: 0124-4003772
Email: [email protected], [email protected]
http://www.nbnindia.com©Asia News Agency All rights reserved. This publication is for individual use
and not for wider dissemination or use without the prior permission of
Asia News AgencySpecial Study
Order Now!
“Kashmir 2019: Strong-arm methods,
political vacuum, living on hope”Kashmir is viewed internationally as a
potential nuclear fl ashpoint, given the fact
that it has been for the last seven decades a
bone of contention between the two nuclear-
armed South Asian nations, India and Paki-
stan. It is one of the world’s oldest unresolved
disputes that has defi ed UN mediation or
intervention.
With Indian general elections around the
corner, Prime Minister Modi spent almost an
entire day in the state on February 3, 2019,
launching a slew of development projects,
from a hospital to a sports complex, a uni-
versity campus to a hydroelectric project, in a
bid to woo the 15 million people of the state
that is a part of India, while a third of whose
original territory is now part of Pakistan and
a sliver with China.
All eyes are now on the Election Com-
mission to see whether the state elections
in Jammu and Kashmir will be held along
with the national elections in India. Will
the exercise in democracy bring new hope
for Kashmir and its people? Will the new
Indian government - if it comes with a strong
mandate - be able to look at Kashmir in a new
light and talk with the disaff ected in Kashmir
and with Pakistan to write a new story for the
state and its people?
Asia News Agency’s New Special Study on
“Kashmir 2019: Strong-arm methods, politi-
cal vacuum, living on hope” examines these
various issues and gives a rare background,
analysis and interpretation on what ails the
state, its tortuous history, its recent contre-
temps and hopes, if any, for the future.
Th e new Special Study is now available
for INR. 4000 in print version and for INR.
3500 in electronic version. Orders can be
placed to Ms.Neetu Singh at 9810622100
Email id:[email protected]