CBDC not gaining traction
This refers to the editorial ‘Measured steps’ (June 6). CBDC/e-rupee not taking off in India was widely expected. The RBI’s introduction of CBDC was hasty and could be attributed to counter the proliferation of cryptocurrency which was threatening to derail the impact of monetary policy on the economy. With India ranked No 1 in digital payment transactions globally with a well-entrenched NEFT/RTGS/IMPS payment systems catering largely to the specific banking requirements of retail customers, people never felt the need for a digital currency.
Data privacy issues had further made CBDC unpopular. Its usage in the wholesale segment was only due to the ongoing Russia-Ukraine war with Russia having been prohibited from using SWIFT messaging system due to imposition of sanctions. Once normalcy is restored, whether countries would still continue using CBDC for interbank/cross-border wholesale payments is a million-dollar question.
Srinivasan Velamur
Chennai
Monsoon woes
While there are reasons to be upbeat about the growth prospects in the current fiscal year against the backdrop of revised better-than-expected GDP numbers for 2022-23, policymakers cannot be oblivious to the headwinds, which include the global economic slowdown, the cumulative effect of interest rate increases in the past year, and the El Nino phenomenon. With climate models pointing to higher chances of El Nino developing by July or August, the probability of just above-normal monsoons looks brighter. If the onset of the monsoon and its coverage got delayed, then it could badly affect the production of kharif crops. Rabi crop production could also take a beating if moisture stress persisted owing to less than anticipated rainfall.
M Jeyaram
Sholavandan, TN
Defence co-operation
This refers to ‘India, US finalise roadmap for defence industrial co-operation’ (June 6). Washington is working to deepen ties with India and sees stronger military-to-military and technology ties with the world’s largest democracy as a key counterweight to China’s dominance in the region.
It is also seeking to wean New Delhi away from its traditional dependence on Russia for defence supplies.
N Sadhasiva Reddy
Washington, US
Nuts from Australia
Apropos ‘Australian industry is nuts about Indian market’ (June 6), an increasingly health conscious Indian middle class is now consuming more of the nutrient packed nuts than ever before. The production of nuts in almost negligible in India compared to the demand and is a big market for the nut producers of the world. Traditionally, Afghanistan has been the main supplier of nuts. Competition is always good for the consumer and given the expanding ties between Australia and India there should be no problem in importing Australian nuts.
Anthony Henriques
Mumbai
Lower interest rates
This refers to ‘RBI may hold policy rate’ (June 6). Though the agriculture and services sectors are progressing well, the dismal show by manufacturing makes banks reluctant to extend credit at reduced interest rates. But with government spending and investments resulting in the emergence of green-shoots, the focus should be more on rate-cuts than inflation control.
NR Nagarajan
Sivakasi, TN
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