How was RBI controlling the commercial banks?
Prior to 1991, banking institutions were subject to too much control by the RBI through high bank rate, high cash reserve ratio and statutory liquidity ratio.
Financial sector includes:
(a) banking and non-banking financial’institutions,
(b) stock exchange market, and
(c) foreign exchange market.
In India, financial sector is regulated and controlled by the RBI (Reserve Bank of India).
There was a substantial shift in role of the RBI from ‘a regulator’ to ‘a facilitator’ of the financial sector. Earlier as a regulator, the RBI would itself fix interest rate structure for the commercial banks. After liberalisation in 1991, RBI as a facilitator would only facilitate free play of the market forces and leave it to the commercial banks to decide their interest rate structure.
India has certain advantages which makes it a favourite outsourcing destination. What are these advantages?
Those public sector undertakings which are making profits should be privatised. Do you agree with this view? Why?
Do you think the navratna pdlicy of the government helps in improving the performance of public sector undertakings in India? How?