In the Rs 20 lakh crore fiscal stimulus announced by the government, there is a credit line to MSMEs worth Rs 3 lakh crore which is going to be 100 percent backed by CG and covers both interest and principal. Additionally, the government plans to provide Rs 20,000 crore of subordinate debt to MSME promoters which could be used as equity. The government will provide Rs 4000 crore to CGTSME which in turn will provide partial credit guarantee to banks under this scheme. The other schemes provide full and partial guarantees to NBFCs, HFCs and MFIs to enable them to raise liquidity and capital. Thus, we are back to not just CGs but the possibility of multiple CGs being governed by multiple agencies. … [Read more...] about Credit guarantees of 1970s make a comeback
Wide ranging perspective
Science writer Mick West continues this line of thinking by pointing out that conspiracy theorists exist on a spectrum. He’s spent years running the website Metabunk, which investigates and discredits a variety of false theories and unusual beliefs. His book, Down the Rabbit Hole, makes the case that to communicate effectively, we need to gain perspective on the range of that spectrum, and where the person’s thinking fits into it. … [Read more...] about Coronavirus pandemic: Dealing with an infection of conspiracy theories
Amartya Sen presents this problem of culture in a fascinating 1991 lecture titled Money and Value: On the ethics and economics of finance: How is it that finance, which is otherwise such a useful economic activity, has been viewed as morally being so dubious? Right from Polonius who advised his son "neither a lender or a borrower be" to Jesus driving moneylenders from temple to Islam considering usury (lending on interest rates) as a sin to Shylock's portrayal in Shakespeare's 'The Merchant of Venice', the dubiousness of finance is a common theme. Yet, as Sen notes, without finance, no progress would have been possible. Whether it was industrial revolution or renaissance, the helping hand of finance was needed. What explains this dilemma? … [Read more...] about Opinion | The role of culture and values in financial crises
In Q4, manufacturing contracted by 1.4 percent as against 0.8 percent contraction in the preceding quarter while construction contracted at 2.2 percent against zero growth in Q3. The positives were agriculture, mining and electricity which grew by 5.9 percent (3.6 percent growth in Q3), 5.2 percent (2.2 percent in Q3) and 4.5 percent (a contraction of 0.7 percent in Q3) respectively. These are the segments that helped the Q3 numbers look better. The forecasts for the quarter were ranging in between 1.2 percent to 3.6 percent. … [Read more...] about Decoding GDP data: India’s economy suffered a double whammy last fiscal and the worst is yet to come
For India, experts have said, banking on Herd Immunity is a “terrible idea”. While speaking to former Congress chief Rahul Gandhi, Director of Harvard Global Health Institute Ashish Jha said, “We are finding that even healthy and young people are getting very ill. We can’t be cavalier about this. We have to protect these people. Herd Immunity in India is a terrible idea as millions will die, even young people.” … [Read more...] about In-Depth: Is Herd Immunity our best bet in the fight against coronavirus?