Letters

Strenthening banks

| Updated on November 20, 2018 Published on November 20, 2018

Among the financial intermediaries, the banking sector plays a key role in the economy to propel growth and dynamism. Banks help create assets in the economy through credit expansion and funding investments both in the private and public sectors. The regulator, the board, and the management of banks must always ensure that they are well-controlled and professionally managed to avoid slippage in governance standards. While a major portion of the banking space is occupied by state-owned banks, the government, as owners, must make sure that the banks are delivering results in consonance with the capital employed. Since regulation of these banks rests with the RBI, it has to ensure that the banks maintain a high degree of compliance. Compliance culture and professionalism are the need of the hour to strengthen the banking system at a time when public sector banks, in particular, are turning weak. This is possible only if all the stakeholders work in cohesion.

VSK Pillai

Kottayam

Jobless growth

This refers to ‘India’s services sector boom has failed on the jobs front’ (November 20). In all sectors, the people at the helm of affairs are trying hard to increase labour productivity as it benefits the organisation as a whole. But in reality, the increased labour productivity has led to accumulation of profit rather than hikes in wages. This is what is happening in the services sector where high labour productivity — facilitated by new technologies such as automation, AI and robotics — is leading to increased contribution of the sector to GDP without creating new jobs. If the gains accrued from high productivity are to be distributed to workers in the form of ‘fewer hours of work per week for the same salary’, it would pave way for additional workers to enter the workforce. France has rightly understood the concept and tackled the challenge of unemployment and increased labour productivity well by way legislating ‘a shorter work week’ (fewer work hours per week) without a cut in salary. Jobless growth in any sector would be detrimental to the health of the overall economy in the long run.

S Lakshminarayanan

Cuddalore, TN

Pulses production

This refers to ‘Don’t lose the pulse’ (November 20). The irony is that India is the largest producer, consumer and importer of pulses in the world and yet vulnerable on each count. This heavily pulse-centric nation also has a price-sensitive market, where consumers demand more pulses if incomes rise and vice versa. Support price and technology have lifted production from 15 million tonnes to 19 mt from 2009 to 2013. Increased MSP has not been very effective as cultivation is largely done by small and marginal farmers who lack risk-sharing ability, having to deal with a commodity that is highly sensitive to the vagaries of the weather.

A greater concern for them is credit availability. The hegemony of the likes of APMC still looms large despite the freedom given to farmers for direct sale. We need to look at expanding the pulse area — small technological intervention can transform a rice-fallow to a rice-gram or rice-lentil system. Together, these can add about 4 mt.

R Narayanan

Navi Mumbai

Protest justified

Sugarcane growers in Karnataka have taken to the streets demanding payment of their dues against supplies. The State government has invited farmer leaders for discussion. But the reality is that sugar mill owners, several of them elected policy-makers in the State government, have crushed the cane supplied to produce sugar and not paid the legitimate dues to the farmers.

The Chief Minister, instead of calling the protesting farmers for a discussion, must first instruct the mill owners to pay the overdue amount to the farmers.

Rajiv N Magal

Hassan, Karnataka

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Published on November 20, 2018
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