Letters

Letters to the editor dated June 2, 2021

| Updated on June 02, 2021

RBI overplaying its role?

This refers to ‘Fault lines in RBI’s surplus transfer to Govt’ (June 2). Though one of the responsibilities of the RBI is to manage debt of the government, based on recent developments one wonders whether the RBI is overplaying its role. Its other commitments in terms of maintaining financial stability and ensuring growth seem to attract less priority.

In spite of galloping WPI, rising petrol and diesel prices and market appetite for higher long term bond rates, continuing with an accommodative monetary policy defies logic.

Looking at the record borrowing programme set by the government for 2021-22, the RBI injecting huge liquidity through OMO and bond buying in spite of low credit off-take indicates that the RBI’s single point agenda is to keep interest rates low to facilitate easy government borrowing. While one would appreciate the supporting role played by the RBI through record surplus transfer and other monetary policy initiatives, it is time that the government kick-starts the economic revival process through its fiscal policy measures.

Srinivasan Velamur

Chennai

Taxes on petro products

With reference to ‘Should taxes on petro products be reduced?’ (HBL, June 1), the most obvious answer could be, why not? The government has never shied away from spending hundreds of crores of public money on various vote-centric schemes — successive waiver of the farm loans is a case in point.

It may be recalled that the government had earlier enhanced the central excise duty even as the global prices of Brent crude were at their lowest ebb, with the sole purpose of ramping up its revenue, much to the discomfiture of the end-users of the twin auto fuels. Hence, it may be futile to expect the powers that be to reduce the taxes on petro products.

Vinayak G

Bengaluru

Class 12 exams

This refers to ‘Govt. cancels class 12 exams of CBSE, ISCE’ (June 2). The abrogation of class 12 examinations has given a breather to tens of thousands of students who were floundering with intense mental and health crises. However, it now begs the question, what mechanism will be adopted by the CBSE to grade the students?

Assessing students on the basis of class 9th, 10th and 11th final exams is a cumbersome task as there are myriad students who migrated to different schools or even cities. Ideally, students should be graded on the basis of internal assessment of class 12 and pre-board examinations. Moreover, writing examinations on a voluntary basis when condition are propitious is a good option. This would also ease the pressure on universities and colleges for admissions.

Aanya Singhal

Noida

Reviving the economy

This refers to ‘Short-lived revival’ (June 2). It is generally recognised that GDP growth is a function of aggregate demand which depends on an increase in household expenditure and government expenditure besides capital formation and investment by business units and firms.

The second wave of Covid has dealt a mortal blow in reviving household demand.

Policymakers have all along focussed on the supply side to revive the economy. They should stimulate aggregate demand through dis-savings whereby the idle financial assets are converted to cash in the hands of households and credit creation for economic activities to fuel GDP growth.

M Ravindran

Nagercoil, TN

Keep vigil at borders

It is likely that the Covid restrictions would be gradually eased in the next couple of weeks and those who fled to villages earlier may start returning back to cities to their jobs. Bearing in mind the infection has already spread to villages and a lot many of them are untested, the returning villagers may be carriers of the disease.

One remedy could be to impose restrictions at the borders by compulsory tests and data collection, failing which all the efforts put in so far would turn out to be an exercise in futility.

Rajiv Magal

Halekere Village, Karnataka

LETTERS TO THE EDITOR Send your letters by email to bleditor@thehindu.co.in or by post to ‘Letters to the Editor’, The Hindu Business Line, Kasturi Buildings, 859-860, Anna Salai, Chennai 600002.

Published on June 02, 2021

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