My analysis to announcement of infusion for Rs 2.11 lac crore :- 1. It is not a bold/ big step, had it been that, then, Mr. PM, would have announced it himself, and not Mr. FM along with all the secretaries. 2. There was no specific time frame mentioned. Upon insisting by news reporters, it was said, that it will done in next 2 yrs. But phase wise plan, or first installment etc were ducked. 3. India's annual budget is of roughly Rs 17 lac crs. So infusion of even Rs 2.11 lac crs, in two years period (which is doubtful, as mentioned above), will widen the fiscal deficit. But Mr. FM, was very categorical, in saying that, the current trend of reduction in fiscal deficit, will continue. So, it definetly means, that they have devised the means, through which govt exchequer will not be burdened by sudden 'capital infusion'. SO What will happen, or how it will happen ????? 4. Infusion plan has 2 parts. Lets talk about smaller part first. Its of Rs 76k crs. It will come from Indradhanush (18k crs) and reducing govt stake (58k crs). Now if u see, then bith these routes for raising capital are already available. Banks and govt are working towards it, so nothing new. Its only packaging and branding. And its not easy at all, as we know, that till now none of the banks have been able to pull it off. 5. Major chunk of this infusion, will come through bonds. Now the govt hasnt disclosed it, but on insisting of news reporters, they said few things. First, the bond mechanism will mainly be dependent on who isaues it ?? Though insisted, he didnt even uttered that govt will issue it. Which indicates that corporate houses can come in or some other thing. Second, he said, that it will be followed by banking reforms. The related Q's were again ducked by Mr. FM. Final Conclusion:- a. Government will push for dissolving their stakes in banks. b. No role of Banks Board Bureau, was mentioned. So it has been assumed redundant. c. The wage revision exercise done by bankers and unions, will have multiple dimensions. Most probably, banking reforms, as suggested, will be pushed as a bargain for revisions. And as govt, seems reluctant to infuse anything from their quota, so the increment might be meagre. d. We can see increased share of corporates, as govt is clear on its gliding path of fiscal deficit. e. Merger seems to be eminent, else banks might not be able to raise Rs 58k crs from the market in coming 2 years. Because market is not buoyant and no one invests in sinking ship. e. There has been no clarity given for bonds. Though insisted by reporters, nothing was divulged. So, it would have been better, if govt would have given the complete details, giving a timely roadmap and specific features, as to, who would issue the bond. The press conference could have waited till then. So, all in all, its a difficult road ahead for banks and society. But lets be positive.
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How we analyse the news papers... Which portion to read and which to escape.
In 2016 Prelims we saw that current events is given good weightage. UPSC is trying to make Prelims more broad based. But questions are not difficult per se. It’s just that it wants you to know both facts and concepts very well – both related to current events and static part of Prelims cum Mains syllabus.
Prepare comprehensively which should cover very basics from NCERT books, daily current events and understanding of various issues and concepts that are mentioned in the syllabus. Aim to have a broad understanding of all important issues that are taking shape around you. Your knowledge should be more broad based than in-depth.
Design 2018 Timetable in such a way that, if you religiously follow it, you will definitely clear both prelims and Mains in 2018 attempt. 10 Months of time is sufficient for this.
Prelims is the first hurdle which you must cross. One must never take chances with it. It will be a painful wait if you don’t clear prelims with comfortable margin.
- Daily Current Affairs for broad understanding of all important issues
- Daily Current Affairs Based Quiz to help you keep tab on Daily Current Affars that are important for prelims
- Any Comprehensive Test Series for General Studies Paper – 1 to score 140+ in this paper
- Mains Self Study – to cover static part + Ethics Paper
- Daily Debates for Mains & Interview Preparation (with friends & family)
Will put up introductory post very soon... 😄