?RBI’s special swap facilities bring $5.6bn in September? (FE, October 5) is a welcome trend. And easing the policy rate by 75 bps MSF cut in the monetary policy has perhaps strengthened bank funding for corporates for going for bank loans. And growth in home loans, auto loans etc is a good trend that we should try to keep it up. It indicates increase in investment and is a sign for the economy to pick up. In this context, Sebi easing norms for overseas investors is welcome. We hope that the finance ministry may be able to contain CAD under $70 billion. And it may be a good achievement if we are able to stabilise the rupee versus the dollar at the level of 60. If we are to contain inflation, the government should take more efforts to contain food inflation, which is a main cause. More investment and reforms in the sector are necessary to increase productivity and production. Development in storage and transport facilities and steps to make India a common market are required. And policy changes to encourage cultivation of vegetables and food crops other than paddy and wheat are also to be taken. Agriculture growth is necessary to increase overall growth and solve many other problems of poverty, employment and development in other sectors like education and health too.
Jacob Sahayam
Thiruvananthapuram
FDI in retail
Apropos of the editorial ?Price’s point? (FE, October 8), the Asia head of Walmart must be having sleepless nights over his company’s future in the opportunity-rich yet futile investment destination, India. Now that the hoopla over FDI in retail is over, not-so-nice truths are beginning to emerge about the viability of rules laid down by the government. Firstly, when our own kirana stores’ shelves are laden with branded products, how does the government expect new entrants to give priority to SMEs at the cost of their profits? To ensure compliance, it should walk its talk and experiment how many local retailers are willing to do so actually and how many consumers are willing to buy those products. SMEs need brand marketing to enable them to withstand competition from established brands. Secondly, the rules are just too ambiguous. While on one hand they give freedom to states on allowing FDI, it leaves these companies vulnerable to Indian politics. Franchise route is an attractive option as many retailers have already made inroads via this method. Promote investment, do not discourage it. The government should keep this in mind before being adamant about nonsensical rules.
Gaurav Gupta
New Delhi
