This refers to the editorial “Banking on gold” ( Business Line , July 30). The slide in the growth of bank deposits in spite of the rise in interest rates is due to the prevailing inflationary situation.

The prices of commodities that we consume daily, such as vegetables, milk, rice have shot up. Almost the entire earnings of an ordinary employee go towards domestic expenses.

Further, though the bank rates have been raised, investment in the yellow metal would fetch a bigger return, in addition to the facility of buying small quantities. Gold offers the further advantage of being pledged, if a sudden need for cash arises.

Relaxation in taxes may not prove attractive since small amounts of interests earned on deposits are not taxed even now. Containing the prices of essential commodities through fair price shops to bring down domestic expenses is the need of the hour.

T. R. Anandan

e-mail

Norms for

port tariff

This refers to “Regulatory uncertainty a major concern for APM Terminals” ( Business Line July 30).

In the interview, Mr Henrik Lungaard Pedersen has indicated that bidding norms and competitive tariff are inter-related.

Currently, the bidder who quotes highest share of revenue to the port trust is awarded licence to operate a container terminal.

A better rational would be to get a quote for the lowest tariff for cargo-related service that the bidder would levy on trade, that is, importer or exporter in India. This rate can be indexed to the rate of inflation of the rupee.

Change of bidding norms, thus, would not affect the port trust’s finance as ship-related services are provided directly by the port trust and charged in foreign currency, in the case of foreign-going ships, and Indian rupee for coastal ships.

K. V. A. Iyer

Kochi

                

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