“You have to pay twice for cigarettes -- once when you get them, and again when they get you”
Anonymous
“आपको कुव्यसनों की कीमत दो बार चुकानी पड़ती है - एक बार जब आप उनके प्रभाव में आते हैं, तथा दूसरी जब वह आपको प्रभावित करती हैं।”
अज्ञात
Friday, November 27, 2020
Quote of the Day November 27, 2020
A breakthrough in banking reforms
RBI must implement its internal report allowing industrial houses to own banks, with checks
The Internal Working Group (IWG) constituted by Reserve Bank of India (RBI) to review ownership guidelines and governance structures in respect to private sector banks has submitted its report. The report is grounded, logical, clear, consistent, and does not fudge or pass up on issues that require coordination outside of RBI’s ambit. It has the courage to explore and challenge continuing holy cows and demonstrate one attribute in its recommendations, what former Securities and Exchange Board of India chairman M Damodaran once called, the least common of the senses, common sense, in abundance.
Let’s evaluate what it has suggested and its logic.
One, IWG has suggested that RBI regulations need to be consistent and the same for all players, irrespective of their licensing date. They have suggested that there is need for harmonisation of various licensing guidelines, relaxations made at any point of time are available to all players, and any tightening in rules also apply to all players in a non-disruptive manner. It has further gone on to aver that the holding by a promoter should have a clear and consistent definition, which does not get changed by separate RBI circulars. It has suggested the use of “paid up voting equity share capital” (equity henceforth) as the right metric. All these recommendations should be obvious and be a basic tenet of providing a level-playing field in the banking sector.
Two, IWG has also made some substantive recommendations on licensing policy. They suggest that promoters of banks be allowed to hold 26% equity stake in steady state or after 15 years. This is against the existing norm of 15%. Promoter holding at the start of the bank should be a minimum of 40% of the equity for the first five years. Our experience with old private sector banks illustrates that boards, where equity ownership is diversified, can take control of a bank and start to direct its operations in a less than optimal manner — Catholic Syrian Bank and Lakshmi Vilas Bank are good examples of this. In fact, 12 old private banks are laggards in respect to technology and risk systems and have not grown their share from 4% of the assets of the system.
Interestingly, our current norms permit foreign ownership, mostly by foreign institutional investors (FII), up to 74% and believe these FIIs are better owners than a promoter, who has invested capital to start and build a bank. Thus, allowing promoters with more skin in the game 26% holding seems to be a smart move. Similarly, the recommendation on a higher minimum initial capital of ₹1,000 crore makes eminent sense as it ensures only serious entities enter the space.
Three, after a careful international review, IWG has recommended a sympathetic review of whether industrial houses should be allowed to own banks if they meet the fit and proper criterion. It has asked RBI to address any outstanding issues or concerns in respect to connected lending and put safeguards in the Act to ensure this, so that applications from industrial houses for bank licences may be considered on the basis of a fit and proper criterion.
Four, it has forcefully recommended that RBI seriously consider Non-Bank Finance Companies (NBFCs) with assets of greater than ₹50,000 crore, and in operation for over 10 years, to be allowed to be converted to banks, whether or not they are owned by industrial houses. RBI has always been comfortable allowing NBFCs to be owned by industrial houses but has struggled to get comfortable in allowing them bank licences. I have never been able to understand the underlying logic of allowing industrial houses NBFC ownership but preventing them from owning banks. It presumes that industrial houses will find it easier to default on an Indian depositor over a public sector bank (from where they currently get most of their funds). To prefer NBFCs, dependent on wholesale funds and subject to asset liability mismatches, over banks with a stable liability base, has been a strange continuing preference of the regulator that IWG has challenged. In fact, I have always argued that large NBFCs should forcibly be converted into banks or be forced to acquire old private banks to mitigate systemic risk in the sector.
Five, IWG has also made a host of sensible suggestions in respect to creating a consistent regulatory regime in India. After an objective assessment of the extant regulations, it has suggested that all banks should be held by a Non-Operating Financial Holding Companies (NOFHC) but that this should not be enforced till there is a tax-neutral status to move from one structure to the other. The group has then made sensible suggestions on a set of outstanding issues in respect of pledging bank shares, issuing ADR/GDR, maximum share holdings by non-promoters, ownership norms around joint ventures and alliances. It has also recommended that banks carry out any activity that is permissible in the bank, within the bank and not in a separate subsidiary.
The IWG report comes not a day late. The report goes a long way in addressing lacunae built up over the years and will advance India’s journey to a $5 trillion economy by reigniting the banking sector. RBI should move quickly to act on these recommendations.
Janmejaya Sinha is Chairman, BCG India
Source: Hindustan Times, 25/11/20
Thursday, November 26, 2020
Quote of the Day November 26, 2020
“I do not pray for success, I ask for faithfulness.”
Mother Teresa
“मैं सफलता की प्रार्थना नहीं करती हूं, मैं विश्वास के लिए कहती हूं।”
मदर टेरेसा
IIT Kharagpur innovation hub on AI and ML to translate research to industrially scalable products
IIT Kharagpur has set up a technology innovation hub on artificial intelligence (AI) and machine learning (ML) to translate academic research to industrially scalable products and processes, a spokesperson said.
IIT Kharagpur has set up a technology innovation hub on artificial intelligence (AI) and machine learning (ML) to translate academic research to industrially scalable products and processes, a spokesperson said.The institute recently set up a special purpose vehicle, the IIT Kharagpur AI4ICPS I Hub Foundation (the Technology Innovation Hub on Artificial Intelligence and Machine Learning) for translation of academic research at the ‘proof of concept level’ to ‘industrially scalable products and processes’, focussed on AI interventions, the spokesperson said on Tuesday.
“While research has been happening in AI and ML for decades, mostly limited to software with limited inclusion in consumer goods and daily used gadgets, graduating innovation to technology readiness for industrial production is crucial,” Principal Investigator Dr Debdoot Sheet, who is also Assistant Professor with the Department of Electrical Engineering and the Centre of Excellence in Artificial Intelligence said.
“The Hub is envisioned to be a unique establishment in the country to undertake a diverse spectrum of activities linking academic research to the industry through an inclusive co-working partnership,” he added.The institute received a grant of Rs 170 crore from the Department of Science and Technology, Government of India under the NM-ICPS to set up the infrastructure and undertake the related research and training programmes.
“We are also committed to promote fundamental research and foster the creation of start-ups to scale production for their off-shelf market availability,” Sheet said.
The hub will further develop critical infrastructure for the nation, an AI Cloud for CPS, a National Knowledge Portal for training human resources on the future-ready AI technology for CPS.
“Tractors and farm machines, 3D printing technology, structural health and road traffic, wastewater engineering, energy-efficient buildings, next-gen wireless communication, human physiology and in-silico disease models are to name a few of the 32 technologies to be developed at the hub,” said Dr Ashish Ranjan Hota, Assistant Professor in the Department of Electrical Engineering.The R&D work will span over core research in algorithms, methods, enabling technologies like machine vision, speech, natural language processing (NLP), text analytics, technology for the internet of things (IoT), and application of AI and ML technologies in a diverse range of industry verticals including healthcare, precision agriculture.
“IIT Kharagpur is a pioneer in AI education and research with more than a hundred faculty members working in theory and methods of AI and its applications across various disciplines.
“This hub will create a multidimensional ecosystem to foster innovation and commercialisation of AI&ML interventions to ICPS spanning across several sectors along with facilitation of new knowledge creation, upskilling human resources, entrepreneurship and job creation,” said Director, Prof Virendra K Tewari.
Along with Dr Sheet are Prof Surjya Pal, Prof Sudeshna Sarkar, Dr Ashish Ranjan Hota, Dr Rajendra Machavaram and over 80 faculty members from diverse disciplines of the institute in driving the hub’s establishment.Their R&D work will have close collaboration with over 50 companies and PSUs who are engaging early on, scouting for potential technologies, the spokesperson said.
Research collaborations are also being discussed with over 30 global research partners towards furthering the objective of an unifying effort to converge the world in building AI for industries of the future across sectors ranging from agriculture to heavy machinery. PTI SUS RG RG
Source: Hindustan Times, 25/11/20
Redesigning urban spaces for women
To make cities women-friendly, urban planners must focus on two core issues —greater safety from violence and adequate childcare support.
Urban planning in India does not factor in gender perspectives. Cities need to be redesigned to address the concerns of women; so that women can work, look after their families easily, and without having to expend more energy, time and money than men do.
The 2019 Safe City Index, prepared by the Economist Intelligence Unit, ranks Mumbai and Delhi as one of the worst cities where women’s safety is concerned. The Index ranked cities on indicators of personal security, digital security and infrastructure security, among other things. All these have a multiplier effect on the position of women — these can negatively affect their access to public spaces, jobs and even how much leisure time they can spend. Indifference to concerns of women results in a difficult commute and poor childcare facilities.
To make cities women-friendly, urban planners must focus on two core issues —greater safety from violence and adequate childcare support. Much of the current discourse focusses on improving street lighting and providing safe toilets. These are important but even more critical to making public spaces safer is mixed land-use planning. The segregation of commercial and residential areas automatically increases the commute from work to home and creates entry barriers to mobility for women. Mixed land-use, by encouraging office space and commercial areas in residential localities, makes for regular use of streets, better lighting and encourages women to use public spaces.
We already have an example in the planned city of Chandigarh, one of the safest for women in India. This city factored in local markets, commercial offices, schools, public parks, post offices, police posts and medical clinics into the design of each small locality or sector. Shaded footpaths were created for walking such that it was possible to cover the city on foot and remain in the shade. And, yet, extensive mixed-use was simply not replicated in other Indian cities. Chandigarh remained an isolated example.
A 2019 Ola Mobility Institute study, which surveyed men and women in 11 cities in India, said that while 80% respondents lived within a 15-minute walking distance of a bus stop, only 47% either walked or cycled to the bus stop. The others used shared transport, two-wheelers and cars. Shared transport has been found to be generally unsafe. But in the absence of dedicated footpaths or cycle tracks, women commuters have little option.
In reimagining urban spaces, we must not focus on somewhat vacuous efforts such as creating special transport services for women. It would, instead, be far more beneficial to sensitise men to be more civil. Already, various surveys have shown that the majority of men in India do not approve of boorish behaviour towards women. The 2015-16 National Family Health Survey indicated that 58% husbands disapproved of wife-beating. In a UN Women-sponsored household survey on sexual violence in public spaces in Delhi in 2012, 94% men said that people should intervene if they see sexual harassment in public spaces. This needs to be built upon and civility inculcated.
The other priority must be reliable childcare facilities, which are necessary if we expect women to enter the job market, sustain jobs and also pursue leisure activities. Ensuring that enough creches are available throughout the city is important to set women free and support them in discharging their parental duties. For construction sites, mobile creches could be the answer.
Recent research by economist Ashwini Deshpande shows that in the wake of the Covid-19 pandemic, those with children below five years suffered the most in the job market. In April 2019, the average employment of women in this category was 7.8%. This dropped sharply to 2.9% in April 2020. In August 2020, it recovered slightly to 3.5%. What is noteworthy is that it was the most highly-educated women who suffered the maximum job losses.
For those with qualifications higher than post-graduate and children below five years of age, the average employment shrank drastically in April 2020, as per the report. With work-from-home becoming the norm, it is the aspirational group of women who lost out the most. An institutional support structure that can take care of this responsibility would improve female participation in the labour force.
It is entirely possible to address such gaps through pilot projects in smaller townships. If well executed, such projects will draw the population away from the mega-cities. The safety of women is a major concern in any household location decision. Undertaking such projects does not require much by way of capital. Various projects for upgrading city infrastructure are already in execution throughout India. Those can easily be tweaked to incorporate gender perspectives.
To make cities women-empowering, we need more imagination and will.
Meeta Rajivlochan is an IAS officer and currently member-secretary, National Commission for Women
Source: Hindustan Times, 25/11/20
Tarun Gogoi: The man who brought peace and growth to Assam
There was much more to Gogoi — a family man who treasured his private moments and valued friendships, but who also believed till the end in dialogue, political respect, and protecting vulnerable groups, whether minority or otherwise. He enjoyed playing the dhulia (drummer) at Bihu festivals.
One of the first things that struck anyone who met Tarun Gogoi, whether in or out of power, was his smile. But behind that beaming exterior was an astute political mind and a strong will. Gogoi, who came up the ranks of the Congress, had a finger on the public pulse.
He was all that we know — a three-term chief minister (successive terms and the longest-serving), a six-term Member of Parliament, a minister in Delhi, who held the posts of Congress joint secretary at the national level and was the Assam Pradesh Congress Committee chief before leading the party to victory in the 2001 state elections.
But there was much more to Gogoi — a family man who treasured his private moments and valued friendships, but who also believed till the end in dialogue, political respect, and protecting vulnerable groups, whether minority or otherwise. He enjoyed playing the dhulia (drummer) at Bihu festivals.
Some vignettes may help draw a portrait of a complex man who brought peace and stability to Assam after a traumatic period of bloodshed, fear and uncertainty. Like many political leaders, Gogoi thought he knew the answers to most of the problems, but he was always open to new perspectives and suggestions.Soon after he became CM for the first time in 2001, Gogoi was intrigued by the idea of extending the Sixth Schedule to the Bodo areas in the Brahmaputra Valley. A sub-committee was set-up to review the schedule under the Constitution Review Commission, headed by Justice Manepalli Narayana Rao Venkatachaliah during Prime Minister Atal Bihari Vajpayee’s tenure.
The group recommended exploring the possibility of extending the provisions, which had till then been limited to the protection of the rights of hill tribes in Assam, Meghalaya, Mizoram, and Tripura, to the plains. The report was sent to Gogoi. Later, legal experts and officials worked on the idea to design the Bodo Territorial Council. The plan was to build and expand peace, development and dialogue.Today, not many young people in Assam will remember the traumatic times of the late 1990s and early part of the first decade of this century: An embracing sense of fear, marked by insurgent strikes, ethnic clashes, and bomb blasts ruled. This was heightened by the presence of armed police, paramilitary and army troops on patrol and at checkpoints where vehicles were stopped and searched even in cities such as Guwahati.
“People don’t remember the bad days when Guwahati shut down at dusk. Now see, the cinemas are having night shows; if people feel safe, they will go out, and that’s what we’ve been able to do,” Gogoi once said.
He cracked down on insurgents yet kept the doors open for dialogue. He took advantage of public fatigue and resentment against the violence that people felt was preventing Assam from taking its place in the national economy. Gogoi helped the state recover and then grow. He had the ear of Sonia Gandhi and Prime Minister Manmohan Singh.
As a grassroots politician and one who also worked at the policy level, Gogoi knew that the region and India gained from Assam’s stability. His state, the biggest in the Northeast, was the pivot for peace and growth. In his view, the two were inseparable.
During his long-and-illustrious political career, Gogoi faced significant political challenges and endured many failures. He could shake off the jousting with former chief minister Hiteswar Saikia only after the latter’s demise.
The second was his falling out with his one-time close confidant and energetic health minister, Himanta Biswa Sarma, over a range of reasons, not least being the Congress leadership’s inability to respond to Sarma’s concerns. It was a colossal miscalculation. Sarma joined the Bharatiya Janata Party and, with Sarbanada Sonowal, led the saffron party to a victory in the 2016 elections. This has transformed the Northeast’s political map and reduced the once-powerful Congress in the state to tatters.
Sanjoy Hazarika is a well-known commentator and author on the Northeast and its neighbourhood
Source: Hindustan Times, 24/11/20
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