Recent sectoral credit and weighted
average lending rate data published by RBI raises some pertinent
questions:
(a)
The share of industry in GDP over past two
decades is unchanged, but the share of industry in bank credit has fallen by
25% despite rate for industry falling the most. Does this explains supply side
constraints of the economy?
(b)
The share of agriculture in GDP has fallen by
50% over past two decades. But the share of credit to agriculture sector has
fallen by just 12%. Does this explain higher capital intensity of agriculture
or populism, as there has been little improvement in productivity.
(c)
Share of personal loans has more than doubled
over past two decades, though housing loan rates in 2012 were 40% higher as
compared to 1992. Does this imply speedier urbanization or unsustainable bubble
in housing sector?
Thought for the day
“Confusion is a word we have invented for an order which is not understood.”
- Henry Miller (1891-1980)
Word of the day
Yawp (v):
To utter a loud, harsh cry; to yelp, squawk, or bawl.
(Source: Dictionary.com)
Shri Nārada Uvāca
PM to meet India Inc on 29 July to discuss:
1. Measures to correct CAD.
2. Measures to revive industrial growth.
3. INR Depreciation and its impact on trade and industry
4. Skill development and ways of accelerating it.
5. Development of industrial corridors.
…………….???
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