market price | Voice from the rooftop

Banks and loans

Posted on April 23, 2011 by Vincent Augustine D'Souza

In 1953 or thereabout the government of India nationalized Imperial Bank and changed its name to State Bank of India.

In 1969 the government of India nationalized 14 banks. In later years more banks were nationalized.

Some years back there was a proposal to nationalize those banks as they were making losses. The employees protested saying there were not responsible for losses.

The banks had lent to many industrialists who had not repaid the loan and that was the reason for losses. Many industrialists in India would have gone bankrupt years ago if banks had insisted on payments.

PDS and cash transfers

Posted on February 11, 2011 by Vincent Augustine D'Souza

There are people who say PDS does not work and cash transfers is the way. Some give example of Bihar where it is said to be 92% effective.

If PDS does not work it should be scrapped. That does not mean people should be given cash. When it is said 92% effective it means 8% ineffective which can become 80% or more. Fictitious accounts can be opened. There is swindling in NREGA and complaints are not investigated. One person in Uttar Pradesh who got an award for his work in NREGA returned it as his complaints were not investigated and swindling continued. Whether the swindling in NREGA is 5% and in road transport 50% as Chidambaram said in Davos or more is a matter of debate.