China Economic Slow Down – 2015

Ajay Kumar

Risk Manager (New Delhi) HDFC Bank

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I have participated India China –Symposia conducted by ICS, Ananta center & India International Center. I have participated in this symposium. It was very fruitful to depict real picture of China‘s Economic slowdown.  So, I am writing what I have Listen and Think about this hot Topic.

China Facing Slow Down in its Economy. There are many reasons like

1. Industrialization Process
2. Depending Upon Domestic Market
3. Capital Crunch
4. Unable to Re balance Investment to Consumption
5. Lacking to Improve Land, Labor and Technology
6. People Bank of China Monetary Policy
7. War of Global Exchange Rate
8. Export Oriented Economy
9. Lacking to Promote Small Scale Business

So, Now China wants to rejuvenate their economy. They can regionalize the Trade and Make Effective External Economic Policy.  So, it can enhance circumstance of china‘s economy and accelerate demand.

We can see below graph where and club India China & Japan together. Then it can maintain Good % of Growth and resist slow down. BRICS can play vital role in World Economy and This Group can support to big economy like India & China.

Need to Understand Global Economic picture. We can see every country who complete the cycle (Developing to Developed) or about to complete, it must face such kind of side effect like economic slowdown. Every country want strong economy so, they can make bilateral agreement particularly in Trade. Its happen basis calculation of

1. Export – Import balance
2. Current a/c deficit
3. Demand – Supply
4. Political Environment
5. Geopolitical Position
6. Seize of Economy
7. Traits of Economy
8. Need of Economy

So, if every country make selfish economic policy or devaluate currency maximum time it will face horrible situation. Need to make balance at global platform. World Bank & IMF role is important at global level without any prejudice and bias.it should stop war of GDP. Need Reasonable and Inclusive Growth of Every Country

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  Written by

  Ajay Kumar

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India Foreign Policy & its Neighbours

Ajay Kumar

Risk Manager (New Delhi) HDFC Bank

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We had seen all neighbours of India joined oath ceremony of Modi. We have expected that new path will be consider by Modi Government and major and critical issues will be solve by this complete verdict of Modi Govt but Scenario is totally different if we can see India' Neighbors where seems complexity like Pakistan, Nepal, Sri Lanka, China.

If Modi Govt. want to improve relation with Pakistan it can't because clapping happen with the help of both side and China is trying to disturb India but Govt can improve relation with other two.
We can see Political instability in Nepal, china is taking benefit of this situation. In past only India was import oil to Nepal but Now China can also import. China want to control Nepal through Economic way, Similarly its treat to Sri Lanka where China already invested huge amount in Sri Lanka. 
China know very well every country want healthy economy particularly small country. We can see political instability, big protests, insurgency all happened in some countries because their economy was not healthy. So economic instrument is strong weapon in foreign policy. It can be neighbours foreign or international foreign policy. 
Why not India play similarly India and China is major economy in Asia if we can see BRICS and ISBA where trillion dollars trade going on. 
If India can also invested huge amount in Sri Lanka and Nepal India can defeat china.
Now Time is to Re look Neighbors Foreign Policy.

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  Written by

  Ajay Kumar

Telecom in Banking - A Revolution in 21st Century

Ajay Kumar

Risk Manager (New Delhi) HDFC Bank

Telecom will play big role in Banking. Question is what kind of medium will be winner and play pioneer role to create revolution in Banking in 21st century.it can be any telecom company, Facebook, Twitter or Whatsapp. if we compare medium whatsapp is playing big role comparative to any telecom Co. In 2009 whatsapp started and hit to telecom co. like airtel and vodaphone. SMS was contributing 10 to 15%  of Revenue but whatsapp enter in market and  hit to telecom co. revenue. whatsapp means free sms or free message, 30 billion message a day in whatsapp as comparative to all telecom co 20 billion meaasge a day. So, we can imagine future role of whatsapp in Banking. Nowadays seems smartphone operator will be 140 million in next 3 to 4 years. Cost of Smart phone is Approx $50 to $60.  we can imagine 600 million smartphone operator in 2020.

10% of E-Commerce Txn done by Mobile. we can see E-Payment segment will take splendid feature. Electronic Clearing of Cheques  is on par of paper clearing. RBI is also enhancing role of RTGS & NEFT. National Payment Corporation of India introduced IMPS it is 24x7 service to movement of digital cash. IMPS exceed the role and overcome to any other mode of txn. Micro ATM will play big role in Rural Area.  

we can see digital branches in future where all activity will be digitized. we can see digital KYC,digital signature, all things will be digital. Therefore RBI announced payment banks and small banks. Bank will move physical to digital and Cash to Cashless.

Challenges-  

• Can Govt ensure 24x7 facility of internet in across the India?
• what would be about Cyber Crime and Frauds?
• what about Telecom Infrastructure in Rural Areas?
• will People accept physical to digital?
• How many people have Internet Banking?
• what about cuts of jobs in Banking particularly in Retail Branches?

Rural Banking - Paradigm Shift

Ajay Kumar

Risk Manager (New Delhi) HDFC Bank

Rural Economy is biggest economy in India. it will be biggest market in 21st Century. Now, Particularly Pvt Banks focused only in Urban and Metro Cities at major level because people are Financial literate and feel free to handle. New Financial experiment  easy to implement. Pvt Banks show only Presence in Rural Area but still they did not understand the capacity of Rural Economy.  Their is many challenges like Technical,Financial, Capital, Infrastructure but Positive thing is that Govt show political will in Rural area, so, Need to cash this opportunity.  IDFC using Micro ATM it will enhance power to face  Technical Challenge. Their is High Capital which is to enhance capital strength. i think Asset Quality will be good as comparative to Metro Asset Quality.

Rural Economy will play big Role in 21st Century.  Growth of Bank depend on How many Accounts, How many Branches in Rural Area  as comparative to other Banks. 

Banks need to Understand Capacity of Rural Economy with Help of Technology, Rural Institution Like NABARD, National Payment Corporation, Telecom Companies.