Articles by R Krishnaswamy

An analysis of bank lending rates suggests that reducing the lending rate, while important, may not be as critical to reviving investment as it is made out to be. The three interest rate regimes followed over the last two decades or so are compared here and it is found that the current base rate regime is by far the most stable, and is one which reduces uncertainty of interest costs.

The Reserve Bank of India's latest accounts indicate that the structure of earnings has clearly shifted to domestic sources, particularly from assets. Further, the RBI has made large transfers to the Government of India over the past few years at the cost of maintaining critical reserves to ensure the fi nancial stability of the central bank. The RBI has not made public a report that is said to provide justification for such a shift in policy. This goes against the post-financial crisis view that central bank operations must be more transparent and open to public scrutiny.

The Central Statistics Office's advance estimates of GDP in 2013-14 place growth in the year at 4.9%. The regular differences every year between the advance and revised estimates of GDP suggest that the former will be modified either upwards or downwards when the final figures come in about two years hence. This is somethingthe CSO needs to look into though there are definite reasons for why the revisions take place, leading to more accurate estimates. The new series of GDP at basic prices is also discussed here.

There is a fear that the current vulnerabilities on the balance of payments front signal another crisis as in 1991. This article analyses the factors underlying the current problems in the BoP and points out the key differences and also a few similarities between the state of the Indian economy then and now.