RBI board should play like Dravid, not Sidhu: Rajan

Agencies
November 6, 2018

New Delhi, Nov 6: Amid mounting tension between the Reserve Bank and the finance ministry, former RBI governor Raghuram Rajan on Tuesday said the central bank is like a seat belt in a car, without which accidents can happen.

Pitching for respecting the institutional autonomy of the RBI, he said the central bank has the liberty to say no if the government pushes it to be lenient.

Ahead of the November 19 meeting of RBI Board, he said the objective of the board is to protect the institution and not serve others' interests.

"The RBI is something like a seat belt. As a driver, the driver being the government, it has the possibility of not putting on a seat belt but of course if you do not put on your seat belt you get into an accident and the accident can be quite severe," he told CNBC TV18.

Historically, the relationship between the RBI and the government has been precisely this – the government wants to focus on improving growth and it does all it can within the limits set by the RBI which are based on financial stability.

"So, the government will push, will try and get the RBI to be more lenient," he said, adding the central bank would examine them in close details and in reference to risks to financial stability. "We (RBI) have responsibility for financial stability and therefore we have an authority to say no," he said.

The RBI led by Governor Urjit Patel and the government have not been on the same page on different issues for some months now. The disagreements came out in open when RBI Deputy Governor Viral Acharya in a hard-hitting speech said failure to defence central bank's independence would "incur the wrath of the financial markets".

It later emerged that the government had used a never-before-used provision of the law to seek resolution of issues, including the easing of NPA norms, so that banks can kick-start lending and support growth, and transferring more dividend to boost liquidity -- issues which the central bank thinks cannot be relented.

"Of course the RBI doesn't say no out of petulance. It says it because it has examined the situation and believes that this take implies too much financial instability," Rajan said. "I think that relationship has gone on for a long and the fact that the RBI says no is not new. The government can keep asking and say please consider this, please consider that but at some point, it says okay I respect your decision, you are the financial stability regulator and I back off".

"Once you have appointed these Deputy Governors and Governor, you have to listen to them because that is what you have appointment them for, they are your safety belt," he said.

On the issue of the government citing Section 7 of the RBI Act that gives it powers to issue directions to RBI Governor on issues of public interest, Rajan said it would be best if each side respected each other's motivation and thoughts.

"And ultimately the RBI after listening to the government and hearing what the government's issues were provided the best professional answer it could and historically it has done that. I have no doubt it is doing that today. It has a responsibility to fulfill to the nation. It has to listen of course but at the end of it, after listening it has to make a decision because ultimately it has that responsibility," he said.

On the role of the RBI board, he said its role historically has not been to take operational decisions but to focus on broader strategy as well as ensure good governance. "So, they are there to ensure that the government's money is well spent in the RBI, for example, the RBI doesn't pay itself inordinate salaries and so on but also to serve as a sounding board which is why we have people from different walks of society, very eminent people," he said.

"So, my sense is the objective of the board is to protect the institution, not to serve others' interest; it is to protect the health of the institution but also to provide wide, sensible advice. The aim of the board is to be Rahul Dravid -- sensible, thoughtful and not, with due respect, Navjot Sidhu," he said.

On the state of the economy, Rajan said the situation is "much better" on the inflation front, for which both the government and the RBI deserve credit.

Also, India is growing faster than most other countries but there is a need to create jobs and there is "probably need (to do) somewhat more than where we are today.

"Where there is more worry is on the fiscal deficit front and here I am not talking just about the central government fiscal deficit which has been coming down but the aggregate fiscal deficit. Even as the central government is bringing it down, the states are taking it up. When you look at the total you find that over the last 3 or 4 years the aggregate fiscal deficit has actually gotten slightly worse and not better," he said.

Besides, the current account deficit (CAD) is blowing out partly because of the relatively weak exports and partly because of the price of oil has gone up. "It has come down recently but it is a risk that we cannot ignore at this point," Rajan said.

On the problems facing non-banking finance companies (NBFCs), he said the central bank needs to examine the liquidity problem much closer and solve the issue by putting liquidity in the market.

"I think the markets are somewhat nervous but I don't think given that NBFCs account for 17 to 18 per cent of assets, that this is an unmanageable problem. I think we can manage it, we have to look carefully at it, see what is really a solvency issue, what is a liquidity issue.

"Certainly on the solvency front, it is up to these privately managed entities to raise equity at this point when they still have the capacity and shore up their balance sheets. There is a tendency sometimes to run to the government and say please bail me out. I think first they have to exhibit everything they can do on their own before the government even contemplates anything on that sort," Rajan added.

In general, central banks, he said, avoid lending to direct entities. Lending to direct entities involves credit evaluation and central banks are not in fiscal function of bailing out entities.

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News Network
June 12,2020

An Indian national was killed and four others injured in alleged firing by Nepal police personnel along the India-Nepal border in Bihar's Sitamarhi district today.

Sources said the firing took place after a clash between the Indians and personnel of Nepal police at the Lalbandi-Janki Nagar border in Pipra Parsain panchayat under Sonebarsha police station of the district.

Jitendra Kumar, the additional director general of police (headquarters), confirmed the death and injuries. The place of firing falls under Nepal jurisdiction.

Locals said Vikesh Kumar Rai, 25, died on the spot and Umesh Ram and Uday Thakur received bullet injuries when they were working in an agricultural field. Another person, Lagan Rai, is said to have been detained by the Nepali police.

Injured persons were rushed to Sitamarhi Sadar Hospital for better treatment.

Vikesh Kumar Rai’s father, Nageshwar Rai, said that his agriculture land falls under Narayanpur in Nepal where his son was working.

On May 17, Nepal police had fired blank rounds to disperse dozens of Indians trying to cross the border. It was not clear if they were also farmers.

The district magistrate and the superintendent of police of Sitamarhi have rushed to the spot.

Nepal shares a 1,850-kilometre (1,150-mile) open border with India and people travel across it for work and to visit family. It had closed its international borders on March 22 amid the coronavirus pandemic.

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News Network
February 26,2020

Feb 26: China’s massive travel restrictions, house-to-house checks, huge isolation wards and lockdowns of entire cities bought the world valuable time to prepare for the global spread of the new virus.

But with troubling outbreaks now emerging in Italy, South Korea and Iran, and U.S. health officials warning Tuesday it’s inevitable it will spread more widely in America, the question is: Did the world use that time wisely and is it ready for a potential pandemic?

“It’s not so much a question of if this will happen anymore, but rather more a question of exactly when this will happen — and how many people in this country will have severe illness,” said Dr. Nancy Messonnier of the U.S. Centers for Disease Control and Prevention.

Some countries are putting price caps on face masks to combat price gouging, while others are using loudspeakers on trucks to keep residents informed. In the United States and many other nations, public health officials are turning to guidelines written for pandemic flu and discussing the possibility of school closures, telecommuting and canceling events.

Countries could be doing even more: training hundreds of workers to trace the virus’ spread from person to person and planning to commandeer entire hospital wards or even entire hospitals, said Dr. Bruce Aylward, the World Health Organization’s envoy to China, briefing reporters Tuesday about lessons learned by the recently returned team of international scientists he led.

“Time is everything in this disease,” Aylward said. “Days make a difference with a disease like this.”

The U.S. National Institutes of Health’s infectious disease chief, Dr. Anthony Fauci, said the world is “teetering very, very close” to a pandemic. He credits China’s response for giving other nations some breathing room.

China locked down tens of millions of its citizens and other nations imposed travel restrictions, reducing the number of people who needed health checks or quarantines outside the Asian country.

It “gave us time to really brush off our pandemic preparedness plans and get ready for the kinds of things we have to do,” Fauci said. “And we’ve actually been quite successful because the travel-related cases, we’ve been able to identify, to isolate” and to track down those they came in contact with.

With no vaccine or medicine available yet, preparations are focused on what’s called “social distancing” — limiting opportunities for people to gather and spread the virus.

That played out in Italy this week. With cases climbing, authorities cut short the popular Venice Carnival and closed down Milan’s La Scala opera house. In Japan, Prime Minister Shinzo Abe called on companies to allow employees to work from home, while the Tokyo Marathon has been restricted to elite runners and other public events have been canceled.

Is the rest of the world ready?

In Africa, three-quarters of countries have a flu pandemic plan, but most are outdated, according to authors of a modeling study published last week in The Lancet medical journal. The slightly better news is that the African nations most connected to China by air travel — Egypt, Algeria and South Africa — also have the most prepared health systems on the continent.

Elsewhere, Thailand said it would establish special clinics to examine people with flu-like symptoms to detect infections early. Sri Lanka and Laos imposed price ceilings for face masks, while India restricted the export of personal protective equipment.

India’s health ministry has been framing step-by-step instructions to deal with sustained transmissions that will be circulated to the 250,000 village councils that are the most basic unit of the country’s sprawling administration.

Vietnam is using music videos on social media to reach the public. In Malaysia, loudspeakers on trucks blare information through the streets.

In Europe, portable pods set up at United Kingdom hospitals will be used to assess people suspected of infection while keeping them apart from others. France developed a quick test for the virus and has shared it with poorer nations. German authorities are stressing “sneezing etiquette” and Russia is screening people at airports, railway stations and those riding public transportation.

In the U.S., hospitals and emergency workers for years have practiced for a possible deadly, fast-spreading flu. Those drills helped the first hospitals to treat U.S. patients suffering from COVID-19, the disease caused by the virus.

Other hospitals are paying attention. The CDC has been talking to the American Hospital Association, which in turn communicates coronavirus news daily to its nearly 5,000 member hospitals. Hospitals are reviewing infection control measures, considering using telemedicine to keep potentially infectious patients from making unnecessary trips to the hospital and conserving dwindling supplies of masks and gloves.

What’s more, the CDC has held 17 different calls reaching more than 11,000 companies and organizations, including stadiums, universities, faith leaders, retailers and large corporations. U.S. health authorities are talking to city, county and state health departments about being ready to cancel mass gathering events, close schools and take other steps.

The CDC’s Messonnier said Tuesday she had contacted her children’s school district to ask about plans for using internet-based education should schools need to close temporarily, as some did in 2009 during an outbreak of H1N1 flu. She encouraged American parents to do the same, and to ask their employers whether they’ll be able to work from home.

“We want to make sure the American public is prepared,” Messonnier said.

How prepared are U.S. hospitals?

“It depends on caseload and location. I would suspect most hospitals are prepared to handle one to two cases, but if there is ongoing local transmission with many cases, most are likely not prepared just yet for a surge of patients and the ‘worried well,’” Dr. Jennifer Lighter, a pediatric infectious diseases specialist at NYU Langone in New York, said in an email.

In the U.S., a vaccine candidate is inching closer to first-step safety studies in people, as Moderna Inc. has delivered test doses to Fauci’s NIH institute. Some other companies say they have candidates that could begin testing in a few months. Still, even if those first safety studies show no red flags, specialists believe it would take at least a year to have something ready for widespread use. That’s longer than it took in 2009, during the H1N1 flu pandemic — because that time around, scientists only had to adjust regular flu vaccines, not start from scratch.

The head of the World Health Organization, Tedros Adhanom Ghebreyesus, said the U.N. health agency’s team in China found the fatality rate between 2% and 4% in the hard-hit city of Wuhan, the virus’ epicenter, and 0.7% elsewhere.

The world is “simply not ready,” said the WHO’s Aylward. “It can get ready very fast, but the big shift has to be in the mindset.”

Aylward advised other countries to do “really practical things” now to get ready.

Among them: Do you have hundreds of workers lined up and trained to trace the contacts of infected patients, or will you be training them after a cluster pops up?

Can you take over entire hospital wards, or even entire hospitals, to isolate patients?

Are hospitals buying ventilators and checking oxygen supplies?

Countries must improve testing capacity — and instructions so health workers know which travelers should be tested as the number of affected countries rises, said Johns Hopkins University emergency response specialist Lauren Sauer. She pointed to how Canada diagnosed the first traveler from Iran arriving there with COVID-19, before many other countries even considered adding Iran to the at-risk list.

If the disease does spread globally, everyone is likely to feel it, said Nancy Foster, a vice president of the American Hospital Association. Even those who aren’t ill may need to help friends and family in isolation or have their own health appointments delayed.

“There will be a lot of people affected even if they never become ill themselves,” she said.

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Agencies
July 20,2020

Kolkata, Jul 20: As many as 13 migrant workers who came to their native village in West Bengal's Bankura district were denied entry at the quarantine centre by the locals.

As a result, the workers had to set up a tent accommodation at a nearby Beraban forest area and lived together in a single tent there, without adequate food, drinking water and basic facilities.

The migrant labourers came from Rajasthan after four months of COVID-19 lockdown which was imposed nationwide on March 25 to contain the spread of coronavirus.

When they arrived at Jagadalla village in the Bankura district and tried to put up at a village school building for two weeks self-quarantine, angry villagers vehemently protested against their entry fearing Covid infections in their village.

Sources said that local police and panchayat members also failed to make the villagers understand the fact that if the labourers strictly stayed in self-quarantine there would be no chance of any further infection.

"The school is located quite within our neighbourhood. If they stay there and tested positive, they might spread Covid infections in the village. We cannot allow them to stay in the school building," said Aniket Goswami, a villager.

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