Corrupted absolutely

This is with reference to the article “Time to talk the walk” by Amar Babu (March 28). The gains of the post-1991 new economic policies were lost after 2004. Along with neo-liberal economics, corruption also boomed. Large-scale bribery has hurt the nation very badly. Business and industries were the worst affected. Not only have we Indians become creatively corrupt, we have also pulled foreign investors into the sea of corruption. No wonder India is at the bottom for best business practices. A Prabaharan

Tiruchirappalli

Advantage who?

As mentioned in your edit “Neither free nor fair” the Election Commission has clearly exceeded its brief even in the banking licence issue. The RBI was in the process of issuing bank licences for the past two years. By questioning the RBI on legal and ethical issues and on the timing, the EC has clearly exceeded its mandate. Which political party is going to get an unfair advantage in the elections if the RBI issues new bank licences? By dragging this issue so long, enough damage has been done to the reputation of the RBI.

CR Arun

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Simply shameful

The Supreme Court has made it impossible for Subrata Roy to get bail. No bank worth its salt will extend a bank guarantee for the amount required (₹10,000 crore) considering the unviable mess his group is in. Moreover, according to RBI guidelines, such guarantee has to be 100 per cent backed by cash margin, that is, fixed deposits. Immovable or movable security are not acceptable, unlike in non-court business transactions. I wonder about the fate of huge credit exposures many banks may currently have against the Sahara Group. How many more Roys still at large?

KR Nayak

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Some misconceptions

While we welcome scrutiny and debate about credit ratings, Rajrishi Singhal’s article “Viewing the world from Wall Street” (March 21) perpetuates a number of myths and misconceptions about ratings agencies and about sovereign ratings in particular.

There was no “error” in Standard & Poor’s analysis when it lowered the US sovereign rating in 2011. We have said publicly that we adjusted our assumptions before announcing the new rating, but this had no impact on our decision. In fact, S&P’s track record of credit ratings as indicators of sovereign default risk is very strong.

The writer also overlooks that ratings agencies have been brought under regulation in most major markets over recent years. This has helped increase the oversight, transparency and accountability of ratings worldwide. Separately, S&P’s has taken its own steps to further strengthen systems, governance, analytics and methodologies.

Regarding rating agency business models, almost every recent independent review of this issue has concluded that no model is immune from potential conflicts of interest. We believe the issuer-pays model — with conflicts properly managed — is the best available model as it enables us to provide ratings simultaneously to all investors free of charge and maximises public scrutiny of ratings.

We disagree with the proposal to replace competing ratings agencies with a single provider of sovereign ratings. The market benefits from a diversity, rather than monopoly, of views on credit risk and investors should be free to decide which ratings providers are credible and useful.

Surinder Kathpalia

MD, head of South and Southeast Asia

S&P’s Ratings Services

Credible manifesto

The Congress’ manifesto is certainly not a “document of deceit” as stated by the BJP. It has well-meant promises which, if implemented, will benefit the people. It contrasts with the BJP’s one-point manifesto: “Make Modi PM”.

If for nothing else, the manifesto must be welcomed for the promises on healthcare, pension for the aged, destitute and disabled and social security. The promise to increase health expenditure to 3 per cent of GDP partially addresses the long-felt need to spend more on healthcare.

G David Milton

Kanyakumari

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