Letters to the editor dated August 13, 2021

The message by the Finance Minister that the ‘Economy not ready yet for RBI to drain out liquidity’ (August 13) is timely. This needs to be seen in the context of the RBI planning to conduct four VRRR (Variable Rate Reverse Repo) auctions to absorb surplus liquidity from the system which are construed as reversal of accommodative policy in some quarters.

With the impact of the Covid pandemic seeing a downward trend and increasing GST collections pointing towards economic revival, it is time to ensure that banks have adequate liquidity to meet prospective credit demand.

On the other hand, between growth and inflation, though emphasis has been rightly laid by the FM on growth with the RBI viewing recent rise in inflation as ‘transitory’, the rising commodity prices is a cause for concern.

Once the economy picks up, leading to industrial production going up with jobs getting created, inflation could rear its head due to higher demand and the impact of cost pass-through. At the global level, there is already a discussion among US Fed officials in favour of tapering asset purchases over a shorter period in view of improvement in employment figures.

Chennai

With reference to ‘Weak action to combat climate change’ (August 13), much has been debated in combating climate change and in mitigating its impact on planet earth and humanity. The surveys and findings on rising sea levels and on increase in atmospheric temperature are frightening. Each country is taking its own efforts in reducing greenhouse gas emissions. Tapping solar energy and switching to electric vehicles are the best ways to reduce the impact of greenhouse gas emission, but there is still a long way to go.

Chennai

This refers to the editorial ‘Rained out’ (August 13). The Opposition not letting Parliament function during the Monsoon Session could at best be described as a matter of national shame.

It goes without saying that the global image of Indian democracy has taken a severe beating. In fact, the need of the hour seems to be to constitutionally empower the voters with a right to recall all such disruptive and rowdy Members of Parliament.

New Delhi

The days of constructive debates and discussion on matters of national importance and public interest in Parliament have long gone. To the dismay of many, disruptions have now taken centre-stage. The abortive Monsoon Session with no worthwhile discussion and debates on a slew of issues confronting the nation does not portend well for our parliamentary democracy.

If the Opposition were to blame for creating pandemonium over the Pegasus spyware issue and stalling the proceedings of Parliament, the ruling dispensation cannot claim high moral ground and should own up responsibility for refusing to yield any space to the Opposition.

That it had bulldozed 20 key pieces of legislation without even a modicum of discussion lent credence of it being intolerant to dissent.

Sholavandan, TN

In the first quarter of FY22, banks, specifically public sector banks, showed signs of stress in the MSME portfolio with a sharp jump in fresh slippages.

The second wave of the pandemic severely curtailing the repayment capacity of MSME is one of the main reasons for the slippages. In spite of warnings from the RBI, in its Financial Stability Report for July, that banks face the prospect of rise in the non-performing loans particularly in their SME and retail portfolios, the efforts to contain have been almost nil.

One of the reasons could be that the significant increase in the credit disbursement to the MSME sector during 2020-21 was backed by government guarantee under the Emergency Credit Line Guarantee Scheme.

Bhimavaram, AP

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