This refers to the report ‘More CPSEs to go on the block, Govt starts process’ (September 27). Recent years have seen Centre and some state governments fast-tracking divestment in loss-making public sector undertakings (PSUs).
PSUs in the past invested in regions which the private sector shunned. But government neglect led to mounting losses in these PSUs.
Governments should think of cross-subsidising loss-making PSUs by profit-making ones.
Where possible mergers should be thought of. Institutions built to serve society should not be closed down looking at profitability considerations alone.
The moonlighting mess
This refers to the Editorial, ‘Sunlight on moonlighting’, (September 27). Moonlighting in the tech sector has been a hot topic. A person may work more than one job in India without breaking the law. However, this could also lead to concerns about violation of confidentiality because many employers include such restrictions in their employment agreements in addition to prohibitions against holding down multiple jobs.
Moonlighting could be considered cheating if an employee’s contract calls for non-compete and single employment.
Under the Factories Act, dual employment is prohibited. However, in some States, IT companies are exempt from that rule. It is crucial for employees to carefully check their employment contract with their principal job to ensure compliance with any moonlighting policies.
N Sadhasiva Reddy
The rupee rumble
Apropos ‘The RBI’s rupee headache’ (September 27), RBI is on a sticky wicket in terms of monetary policy measures it needs to take in the light of the Fed Reserve aggresive rate hikes. This has put emerging economies like India in a tight spot. Though it could be claimed rupee is doing well when compared to other currencies, but this is largely due to RBI’s intervention wher it uses its surplus reserves, the source of which itself is short term and volatile in nature.
Since inflation in India is predominantly ‘cost push’, the government should think in terms of bringing down food/non-food and retail prices of fuel and LPG as international crude oil prices are coming down. This will supplement RBI’s repo rate hikes and other policy instruments to check inflation.
The Indian policy makers has an unenviable task of not only to contain inflation but to ensure growth. Despite the challenges, India is still set to remain the fastest growing economy in the world. So the RBI and the Centre’s policy moves must supplement each other.
Apropos ‘The RBI's rupee headache’ (September 27), the US Fed’s rate hikes are sending jitters to central banks across the world. Central banks release foreign reserves in the open market to ease the situation.
In India foreign reserves touched an all time high of $642 billion in September 2021. The RBI has been releasing dollars in the recent weeks to arrest the rupee’s slide. In the longer run, it is not advisable to use the hard earned reserves just to shore up the rupee.
It is time that RBI took measures to attract deposits from NRIs and funds from foreign investors, though it takes time to garner the required funds. The MPC meetings must be used to brainstorm on the issue of strengthening the rupee against dollar.