Índia Publicações Atualização da Regulamentação da Índia (SEBI / RBI) Publicações da Índia, Escrito por Meenakshi Iyer 13/11/2013 1.0 BANCO DE RESERVA DA ÍNDIA ACTUALIZAÇÕES REGULATÓRIAS e DESENVOLVIMENTOS 1.1.1 Notificação a SCBs Marginal Standing Facility Com efeitos a partir de 7 de outubro de 2013, A taxa de Marginal Standing Facility (MSF) de 9,50 por cento para 9,00 por cento. Rbi. org. in/scripts/NotificationUser. aspxId8497ampMode0 bull Taxa bancária A partir de 7 de outubro de 2013, a taxa bancária está ajustada de 9,50% para 9,00%. Rbi. org. in/scripts/NotificationUser. aspxId8498ampMode0 bull Term Repo no âmbito da facilidade de ajustamento de liquidez RBI realizaria leilões de repos de prazo de 7 e 14 dias de prazo por um montante notificado equivalente a 0,25 por cento da Demanda Líquida e do Passivo por Tempo (NDTL) O sistema bancário através de mecanismo de leilão de taxa variável. Rbi. org. in/scripts/BSCircularIndexDisplay. aspxId8501 touro Mudança de nome da agência de classificação de PME da Índia limitada a SMERA ratings limitada (SMERA) M / s. A Agência de Avaliação de Pequenas e Médias Empresas da Índia Limited foi credenciada para fins de ponderação de risco dos créditos bancários para efeitos de adequação de capital, juntamente com outras agências de notação de crédito (CRAs). A agência mudou seu nome para SMERA Ratings Limited. RBI. org. in/scripts/NotificationUser. aspxId8510ampMode0 bull Descontração na política de autorização de filial Em 21 de outubro de 2013, a RBI publicou diretrizes detalhadas para bancos comerciais regulares nacionais para abrir suas filiais nos centros Tier 1 a Tier 6, A necessidade de ter permissão de RBI em cada caso. Rbi. org. in/scripts/BSCircularIndexDisplay. aspxId8518 touro Resolução de reclamações relativas a pessoas desaparecidas no desastre do Uttarakhand Na sequência da catástrofe natural de Uttarakhand durante 14 a 20 de Junho de 2013, com base na circular emitida pelo Ministério do Interior (MHA) , Govt. Da Índia, a RBI aconselhou as SCBs a liquidar as reivindicações relativas a pessoas desaparecidas, abrangidas pela circular da MHA, sem insistir na produção de qualquer documentação que não seja (i) Certificado de óbito emitido pelo Oficial Designado sob a circular da MHA e (ii) carta de indenização . Lei de bancos (alteração) de 2012 - aplicabilidade aos bancos do setor privado Em 23 de outubro de 2013, os bancos do setor privado foram informados de que as alterações feitas para a Lei de Regulamentação Bancária , 1949 e notificado como a Lei de Alteração da Lei de Bancos de 2012, vinculam os bancos, não obstante quaisquer cláusulas em contrário contidas no Memorando de Associação (MoA) e nos Estatutos dos bancos. Os bancos também foram aconselhados a fazer as alterações necessárias em seu MoA e AoA sob o aconselhamento ao RBI. Rbi. org. in/scripts/BSCircularIndexDisplay. aspxId8523 A aceitação do serviço e-KYC como processo válido para a verificação do KYC Em 25 de outubro de 2013, os bancos e outras agências interessadas foram aconselhados pelo RBI a aceitar o serviço e-KYC da Unique Identification Authority of India (UIDAI) como um processo válido para a verificação de KYC sob a Regra de Prevenção de Lavagem de Dinheiro (PML) 2005. Além disso, as informações disponibilizadas no processo e-KYC podem ser tratadas como um documento oficialmente válido sob Regras PML. Rbi. org. in/scripts/BSCircularIndexDisplay. aspxId8526 bull Instalação de ajuste de liquidez ndash Repo e Reverse Repo Rates A partir de 29 de outubro de 2013, a RBI aumentou a taxa de Repo e Repo Rate de acordo com a facilidade de ajuste de liquidez de 7,50 por cento para 7,75 por cento e De 6,50% para 6,75%, respectivamente. Rbi. org. in/scripts/BSCircularIndexDisplay. aspxId8533 touro Marginal Standing Facility rates (MSF) A partir de 29 de outubro de 2013, a RBI reduziu a taxa de MSF de 9,00% para 8,75%. Rbi. org. in/scripts/BSCircularIndexDisplay. aspxId8534 bull Repo de Termo sob a facilidade de ajuste de liquidez A partir de 29 de outubro de 2013, RBI aumentou o quantum de liquidez a ser fornecido através de Repos Termo de 7 e 14 dias de tenor do atual 0,25 por cento para 0,50% do NDTL do sistema bancário. Rbi. org. in/scripts/BSCircularIndexDisplay. aspxId8535 bull Due diligence na relação bancária correspondente A RBI observou que alguns bancos comerciais têm acordos com bancos cooperativos em que estes últimos abrem contas correntes com os bancos comerciais e usam a facilidade de cheque para emitir Lsquoat parrsquo cheques para seus constituintes e walk-in clientes para facilitar suas remessas e pagamentos. Uma vez que o lsquoat parrsquo facilidade oferecida pelos bancos comerciais aos bancos cooperativos é da natureza de correspondente bancário arranjos, os bancos têm sido aconselhados a monitorar e rever esses acordos para avaliar os riscos, incluindo risco de crédito e risco de reputação decorrentes de lá. Para este fim, os bancos foram ainda aconselhados a manter o direito de verificar os registros mantidos pelos bancos / sociedades cooperativas clientes para o cumprimento das instruções existentes sobre KYC e AML sob tais acordos. Rbi. org. in/scripts/NotificationUser. aspxId8536ampMode0 bull Instalações de liquidez permanente para bancos e distribuidores primários A partir de 29 de outubro de 2013, as facilidades de Liquidez Permanente fornecidas aos bancos sob refinanciamento de crédito à exportação e aos revendedores primários Disponível em 7,75 por cento. Rbi. org. in/scripts/BSCircularIndexDisplay. aspxId8537 bull Taxa bancária Em vigor a partir de 29 de outubro de 2013, a Taxa Bancária está ajustada em 25 pontos base, ou seja, de 9,00% para 8,75%. Rbi. org. in/scripts/NotificationUser. aspxId8539ampMode0 1.1.2 Notificação para bancos de AD bull Exportação em Exportação (XOS) online bank wide submission Foi decidido que, a partir do semestre findo em Dezembro de 2013, o envio de XOS De todas as faturas de exportação pendentes além de seis meses a partir da data de exportação em uma base semestral) devem ser feitas on-line e em todo o banco, em vez do sistema atual de sucursal por meio dos respectivos Escritórios Regionais do Banco de Reservas da Índia. Rbi. org. in/scripts/NotificationUser. aspxId8484ampMode0 bull Empréstimos no exterior em moeda estrangeira por bancos de revendedores autorizados Com vista a proporcionar uma maior flexibilidade aos bancos da categoria AD - na procura de acesso a fundos no estrangeiro, os bancos AD têm sido autorizados a contrair empréstimos do seu chefe Escritório ou filiais no exterior ou correspondentes fora da Índia ou qualquer outra entidade, conforme permitido pela RBI até 100 de seu capital Tier I não-empobrecido ou US $ 10 milhões, o que for maior, sujeito às condições que a RBI possa direcionar. Por conseguinte, foi concedida autorização aos bancos da Categoria I da AD para contrair empréstimos junto de instituições financeiras internacionais / multilaterais por um período limitado até 30 de Novembro de 2013. Tais empréstimos deveriam ser destinados a operações bancárias gerais e não para aumento de capital e estarão sujeitos a As condições estipuladas pelo RBI. Tais empréstimos serão elegíveis para a facilidade SWAP de RBI leiloada. Rbi. org. in/scripts/NotificationUser. aspxId8507ampMode0 bull Fechamento de contas antigas pendentes: Exportação-follow-up ndashXOS Declarações Foi decidido que uma antiga conta de exportação pode ser fechada por bancos AD como uma medida única, se eles estão satisfazendo a Condições estabelecidas. O relatório de casos fechados deve ser submetido aos escritórios regionais interessados de RBI por bancos de ANÚNCIO no formato prescrito na folha do excel. Rbi. org. in/scripts/NotificationUser. aspxId8509ampMode0 1.1.3 Notificação emitida a todos os bancos membros do RTGS bull Lançamento do novo sistema RTGS O novo sistema de liquidação bruta em tempo real (RTGS) confirmando o padrão de mensagens ISO 20022 será operacionalizado em 19 de outubro de 2013 E o Regulamento do Sistema LBTR 2013 entraria em vigor a partir desse dia. Rbi. org. in/scripts/NotificationUser. aspxId8508ampMode0 1.2.1 RBI anuncia medidas para melhorar as condições de liquidez Com o objetivo de melhorar as condições de liquidez, RBI em 7 de outubro de 2013, anunciou: a. Redução da taxa de facilidade permanente marginal (MSF) em mais 50 pontos de base (mais cedo foi reduzido em 75 pontos de base em 20 de setembro de 2013, de 9.50 por cento para 9.00 por cento com efeito imediato eb) provisão de liquidez adicional por prazo Repos de 7 dias e 14 dias para um montante notificado equivalente a 0,25 por cento do débito líquido e do passivo (NDTL) do sistema bancário através de leilões de taxa variável em todas as sextas-feiras a partir de 11 de outubro de 2013. 1.2.2 Ajuste na taxa bancária Com base na redução da taxa de MSF em 50 pontos base, a partir de 7 de outubro de 2013, a RBI ajustou a taxa bancária de 9,50% para 9,00% com efeito imediato. 1.2.3 RBI nomeia o comitê técnico de RBI sobre operação móvel em 9 de outubro de 2013 , Anunciou a constituição de um comitê técnico sobre banca móvel, para examinar as opções / alternativas, incluindo a viabilidade de usar criptografados SMS baseado transferência de fundos usando um aplicativo que pode ser executado em qualquer tipo de aparelho para a expansão da banca móvel no país. O comitê apresentará seu relatório até o final de dezembro de 2013. 1.2.4 O governador do RBI lança o novo regulador RTBI do sistema RTGS conforme ISO 20022, em 19 de outubro de 2013, lançou o novo sistema RTGS (Real Time Gross Settlement) do RBI. Prevê-se uma melhoria significativa da eficiência dos mercados financeiros. Alegadamente, é o primeiro no mundo, a ser construído sobre os padrões de mensagens ISO 20022. É altamente escalável e terá várias novas funcionalidades, tais como recursos de liquidez antecipada, incluindo mecanismo de resolução de bloqueio e facilidade de liquidação híbrida, facilidade para aceitar transações com valor futuro, opções para processar transações em várias moedas, etc. Fornece três opções de acesso aos participantes Ndash thick-client, Web-API (através da INFINET ou qualquer outra rede aprovada) e módulo de originador de pagamento. Os participantes podem decidir o modo de participação no sistema com base no volume de transações e no custo de instalação da infra-estrutura. Com a implementação do novo sistema LBTR, o sistema LBTR existente deixará de estar operacional. 1.2.5 RBI recebe US $ 10,1 bilhões sob RBI de troca de câmbio forex, de 4 de setembro de 2013 a 23 de outubro de 2013 (em inglês, RTGS (Membership) Business Operating Guidelines, 2004 e RTGS (Membership) , Recebeu US $ 10,1 bilhões sob a janela especial de concessão para trocar os depósitos de FCNR (B) e empréstimos em moeda estrangeira no exterior. 1.2.6 RBI nomeia o GIRO Advisory Group (GAG) Em 24 de outubro de 2013, a RBI anunciou a constituição de um GIRO Advisory Group (GAG) para implementar um sistema nacional de pagamento de contas baseado na GIRO, de forma que as famílias possam usar banco Contas para pagar taxas escolares, serviços públicos, contas médicas e fazer remessas por via electrónica. O grupo apresentará o seu relatório até ao final de Dezembro de 2013. 2.1.1 Facilitar as transacções em sistemas de fundos mútuos através da infra-estrutura de bolsa SEBI, vide a sua circular de 4 de Outubro de 2013, permitiu aos Distribuidores de Fundos utilizar a infra-estrutura de bolsas reconhecidas para Compra e resgate de unidades de fundo mútuo diretamente de fundos mútuos / empresas de gestão de ativos. Esta facilidade está para além dos canais de distribuição existentes. Esta facilidade estava disponível para corretores de Bolsa e membros de compensação. Foi ampliado aos distribuidores de fundos mútuos, a fim de ampliar o alcance dos distribuidores de fundos mútuos e também permitir que eles tirem o máximo proveito da plataforma de bolsa. As principais disposições da circular são: bull As distribuidoras de fundos mútuos tornar-se-ão elegíveis somente se estiverem registradas na Associação de Fundos de Investimento na Índia (AMFI). Bull Os distribuidores de fundos mútuos precisarão obter permissão de bolsas de valores reconhecidas. Baseado nos critérios prescritos pelas bolsas de valores, ou seja, taxa, código de conduta, etc bolsas de valores iria conceder permissão para distribuidores de fundos mútuos. O pedido de permissão deve ser feito pelo distribuidor de fundos mútuos registrado pela AMFI. Bull Distribuidores de fundos mútuos não seriam autorizados a lidar com pagamento e pagamento de fundos, bem como unidades em nome dos investidores. As Bolsas de Valores foram aconselhadas a implementar os sistemas necessários para garantir que o pagamento será recebido diretamente pela corporação de compensação reconhecida eo pagamento será feito diretamente para a conta do investorrsquos. Da mesma forma, as unidades seriam creditadas e debitadas diretamente da conta D-mat dos investidores. 2.1.2 Conheça as exigências dos seus clientes A SEBI enviou sua circular datada de 13 de agosto de 2012, informando que a carta Aadhar emitida pela Unique Identification Authority of India (UIDAI) seria admissível como Prova de Endereço e Comprovante de Identidade. Em consulta com a UIDAI e os participantes do mercado, a SEBI divulgou a sua circular datada de 8 de Outubro de 2013, decidiu aceitar os serviços e-KYC lançados pela UIDAI. As informações que contêm detalhes relevantes do cliente e fotografia disponibilizados pela UIDAI como resultado do processo e-KYC devem ser tratadas como prova suficiente de identidade e endereço do cliente. No entanto, o cliente deverá autorizar o intermediário a aceder aos seus dados através do sistema UIDAI. 2.1.3 Fundo de Investimento em Ações (ETFs Gold) e Sistema de Depósitos em Ouro (GDS) dos bancos Os Regulamentos SEBI (Fundos Mútuos), de 1996, permitem que o Gold Exchange Traded Fund Schemes (ETFs Gold) investe em ouro e ouro. A SEBI tinha divulgado a sua circular datada de 15 de Fevereiro de 2013, permitindo que os Gold Deposit Schemes (GDS) dos bancos fossem tratados como um dos instrumentos relacionados com o ouro. Nos termos do parágrafo 2 (c) da referida circular, fundos mútuos foram autorizados a investir em tais Gold Deposit Schemes desde que Gold Certificates são detidos pelos fundos de investimento apenas em forma desmaterializada. SEBI tem agora a sua circular datada 18 de outubro de 2013, esclareceu que os certificados de ouro emitidos por bancos podem ser mantidos por fundos de investimento em forma física também. 2.1.4 Formatos sob a SEBI (Aquisição substancial de ações e aquisições) Regulamentos, 2011 (Regulamentos) SEBI vide sua circular de 21 de outubro de 2013, modificou os formatos de divulgação nos termos do Regulamento 29 (1), 29 (2) e 31, À divulgação de participação, aquisição e alienação de ações e divulgação de ações oneradas, respectivamente. As mudanças nos formatos da divulgação foram feitas a fim de ajudar os investidores no processo de tomada de decisão sob cláusulas relevantes do referido regulamento. Os formatos de divulgação estão disponíveis no site da SEBIrsquos. 2.1.5 Informação Geral O Documento SEBI vide a sua circular datada de 23 de Outubro de 2013, estipulando que, no que diz respeito às emissões de capital, as informações genéricas e não específicas do emitente serão apresentadas sob a forma de um Documento de Informação Geral GID). Por conseguinte, não seria necessário fornecer informações genéricas no prospecto abreviado. A divulgação genérica a ser divulgada no GID seria abrangem o seguinte: bull Objetivo do boletim de Informações Gerais (GID) Breve introdução às IPOs / FPOs touro Categoria de investidores elegíveis para participar de uma questão bull Aplicação no assunto bull Issue Procedimento em livro construído Emissão touro Procedimento de emissão em preço fixo Bolsa de emissão Procedimento de alocação e base de alocação touro Interesse e devoluções Os Gestores Líderes foram aconselhados a assegurar que: touro O GID deve incorporar explicitamente a data da última actualização. Bull O número de GIDs impressos por cada empresa emissora não deve ser inferior a cinco por cento do total do prospecto abreviado / formulários de candidatura impresso ou 50.000 em número, o que for menor. Touro Uma cópia do GID é fornecida a um investidor como e quando solicitado, na forma e maneira assim solicitada pelo investidor. O GID actualizado deve ser disponibilizado aos investidores e o mesmo deve ser disponibilizado nos sites das bolsas de valores, onde as acções de acordo com uma Emissão são propostas para serem listadas. A circular sobre a GID seria aplicável a todos os Prospectos da Herring Vermelha (RHP) não arquivados no Registro de Empresas (RoC) até a data da circular. 2.1.6 Cotação de valores mobiliários específicos de pequenas e médias empresas (PME) na plataforma de negociação institucional (PTI) numa Bolsa de PME sem fazer uma oferta pública inicial A SEBI divulgou a sua circular datada de 24 de Outubro de 2013, tendo emitido directrizes detalhadas sobre o assunto em epígrafe. A fim de facilitar a captação de capital por parte das PME, foi decidido permitir a inclusão sem uma oferta pública inicial (IPO) ea negociação de valores mobiliários específicos de pequenas e médias empresas (PME), incluindo empresas iniciantes na Plataforma de Comércio Institucional (ITP) Intercâmbio de Pequenas e Médias Empresas. A cotação e negociação de valores mobiliários especificados na ITP são regidas pelo Regulamento SEBI de 2013 (Regulamentos ITP) emitido em 8 de Outubro de 2013. A principal disposição desta circular é a seguinte: Uma empresa pública que pretenda inscrever-se na ITP deve cumprir o seguinte: a. A empresa, seu promotor, empresa do grupo ou diretor não deve aparecer na lista de inadimplentes intencional de RBI. B. Não deve haver nenhuma petição de liquidação contra a empresa que tenha sido admitido por qualquer tribunal competente. C. A sociedade, sociedades do grupo ou filiais não deveriam ter sido encaminhadas ao Conselho de Reconstrução Industrial e Financeira no prazo de cinco anos anteriores à data do pedido de admissão à cotação. D. Nenhuma medida regulamentar deveria ter sido tomada pela SEBI, RBI, Autoridade de Regulação e Desenvolvimento de Seguros (IRDA) ou Ministério de Assuntos Corporativos contra a empresa, seu promotor ou diretor dentro de um período de cinco anos antes da data de aplicação da listagem. E. A empresa deve ter, pelo menos, uma demonstração financeira auditada do exercício completo, para o exercício imediatamente anterior à data da apresentação do pedido. F. A empresa não deve ter completado um período de mais de 10 anos após a incorporação e suas receitas não devem ter excedido cem rupias crore em qualquer dos exercícios anteriores. G. O capital pago da empresa não deve ter excedido vinte e cinco rupias crore em qualquer dos anos financeiros anteriores h. Além disso, a empresa deve ter recebido investimentos / financiamento de pelo menos uma das seguintes categorias, como abaixo: a) Um Fundo de Investimento Alternativo ou um Fundo de Capital de Risco ou Angel Investors ou outros credores de investidores aprovados pela SEBI ou um Comerciante Banqueiro ou um comprador institucional qualificado deve ter investido mínimo Rúpias cinquenta lakh nas ações da empresa. O Tal empresa deveria ter recebido financiamento de um banco agendado para seu financiamento de projetos ou necessidades de capital de giro e um período de três anos deveria ter decorrido desde então e esse financiamento deveria ter sido totalmente utilizado. O Uma agência multilateral internacional especializada deveria ter investido no capital social da empresa. Bull Processo de listagem Uma empresa que satisfaça os critérios de elegibilidade de acordo com os regulamentos seria obrigado a aplicar à bolsa de valores reconhecida para a lista junto com o documento de informação contendo divulgações, conforme especificado na Emissão de Requisitos de Capital e Divulgação, ). A bolsa de valores em causa pode conceder uma aprovação em princípio para poder ser admitida à cotação na ITP. Bull Capital raising Uma empresa listada na ITP está impedida de fazer uma oferta pública inicial enquanto está sendo listada na plataforma. No entanto, tal empresa é permitida para levantar capital através de colocação privada ou através de uma questão de direitos. Uma empresa que fizesse uma emissão de direitos seria obrigada a enviar uma carta de oferta aos seus accionistas através de correio registado ou correio rápido ou modo electrónico e o mesmo seria disponibilizado no site da empresa e na bolsa de valores reconhecida. Bull Participação mínima do promotor e lock-in Está estipulado que não menos de vinte por cento do capital social da empresa serão detidos pelos promotores no momento da inscrição e os mesmos serão bloqueados por um período de Três anos a partir da data de inclusão na lista. Bull Sair da plataforma A saída da plataforma pode ocorrer como prescrito abaixo: a. A saída voluntária é permitida após obtenção da aprovação do acionista através da aprovação de Resolução Especial através de voto por correspondência, onde noventa por cento do total de votos e maioria dos votos de não promotores foram emitidos a favor dessa proposta e tem a aprovação do SME Exchangersquos. B. Uma empresa pode sair da plataforma dentro de 18 meses a partir da ocorrência de qualquer um dos seguintes eventos: o A empresa foi listada na ITP por um período de 10 anos, o A empresa tem um capital pago de mais de vinte e cinco rupias crore , O A empresa tem receitas de mais de três centenas de rupias crore conforme a última declaração financeira auditada, o A empresa tem uma capitalização de mercado de mais de quinhentas rupias crore. C. Uma empresa deve ser excluída da lista e ser removida permanentemente da listagem da ITP sob qualquer uma das seguintes circunstâncias: o não arquivamento de registros periódicos na bolsa de valores reconhecida por mais de um ano o falha em cumprir as normas de governança corporativa por mais de um ano. Bull Obrigações O Conselho de Administração, o Diretor Presidente e o Diretor Financeiro da empresa deverão aprovar e assinar o projeto eo memorando de informação final. Além disso, eles são obrigados a certificar que todas as divulgações mencionadas no documento são verdadeiras e corretas. Se houver qualquer declaração incorreta ou omissão no documento, eles seriam responsáveis pelo mesmo. Após ter sido admitida na ITP, a empresa celebrará um acordo com as bolsas de valores reconhecidas. O modelo de acordo de listagem para o referido objectivo foi prescrito pela SEBI no anexo A da circular. 2.1.7 Normalização e simplificação dos procedimentos de transmissão de valores mobiliários A SEBI, vide a sua circular de 28 de Outubro de 2013, emitiu alguns conjuntos de normas e procedimentos para a transmissão de valores mobiliários em modalidade física e desmaterializada. As mudanças no procedimento foram introduzidas para tornar o processo mais eficiente e fácil para os investidores. Os Agentes de Transferência de Ações (STAs) ou as empresas emitentes e os depositários deverão cumprir as diretrizes dadas nesta circular, conforme exposto abaixo: bull No caso de os títulos a serem transferidos estarem em modo desmaterializado e sejam mantidos em nome único sem Qualquer candidato com um limiar de Rs 1, 00.000, o limiar limite foi aumentado para Rs 5, 00.000. Bull No caso de títulos a serem transferidos estão em modo físico: a. Quando os títulos são mantidos em nome único com um nomeado, a SEBI deu instruções às STAs ou empresas emitentes para que sigam o requisito documental padronizado que inclui (i) o pedido assinado de transmissão do nomeado, (ii) Original ou cópia do atestado de óbito devidamente atestado por um notário Público ou por um oficial citado, (iii) Auto-atestado cópia do cartão PAN do nomeado. B. Quando os títulos são mantidos em nome próprio sem um nomeado e o valor dos títulos é de Rs 2, 00.000, então SEBI aconselhou STAs ou empresas emitentes para produzir a declaração sob juramento feita em papel de selo não judiciais apropriado para efeitos de identificação e reivindicação De propriedade legal para os títulos, juntamente com NOC de herdeiros legais ou cópia da Escritura de Liquidação Familiar, notarizada e executada por todos os herdeiros legais do detentor falecido, e uma carta de indenização em papel judicial. C. Se os títulos são mantidos em nome único sem um nomeado eo valor dos títulos é superior a Rs 2, 00.000, STAs / empresas emissoras foram aconselhados a apresentar um certificado de Sucessão ou Testamento de vontade ou Carta de Administração ou decreto da Corte. 2.1.8 Divulgação de reclamações de investidores em websites de bolsas de valores Em 3 de setembro de 2009, a SEBI emitiu uma circular sobre divulgação de reclamações de investidores e detalhes de arbitragem no site da Bolsa de Valores. A SEBI divulgou a sua circular datada de 28 de Outubro de 2013, tendo decidido modificar o relatório ldquoRelatório 1Crdquo de divulgação de reparação de queixas apresentadas por clientes contra corretores no exercício. As seguintes modificações foram apresentadas no formato do Relatório 1C: número de clientes ativos de cada corretor de ações que negociou pelo menos uma vez no último ano. Touro Porcentagem do número de reclamações recebidas em relação ao número de clientes ativos do corretor de ações. Touro Porcentagem de reclamações resolvidas contra reclamações recebidas pelo corretor. Para além desta alteração, as bolsas de valores são obrigadas a divulgar separadamente os seguintes detalhes: a. Número total de reclamações recebidas contra todos os corretores da bolsa, número de seus clientes ativos e sua porcentagem e b. Taxa global de reparação do mercado, dividindo o número total de reclamações reparadas com o número total de reclamações recebidas contra todos os corretores da bolsa. 2.1.9 Questões relativas à emissão primária de títulos de dívida - alteração ao acordo simplificado de constituição de dívidas A SEBI introduziu certas alterações no que se refere à emissão primária de títulos de dívida. As medidas introduzidas são as seguintes: bull Divulgação de fluxos de caixa: A SEBI, vide it circular em 13 de Abril de 2007, estipulou que para todas as novas emissões de obrigações de empresas, o cálculo do pagamento de juros será real / real. Para melhorar as divulgações adicionais, decidiu-se que os fluxos de caixa que emanam dos títulos de dívida devem ser mencionados no prospecto / documento de divulgação como ilustração. Além disso, para efeitos de normalização e em consonância com os títulos públicos datados, foi também decidido que se a data de pagamento dos cupões dos títulos de dívida cair num domingo ou feriado, o pagamento do cupão será efectuado no dia útil seguinte . Se a data de vencimento dos títulos de dívida, cair num domingo ou feriado, o produto do resgate será pago no dia útil anterior. Bull Retirada da obrigação de fazer o upload de lances sobre a prioridade de data e hora: Foi decidido que a colocação em emissões públicas de títulos de dívida deve ser feita com base na data de upload de cada aplicativo para o livro eletrônico da bolsa de valores. No entanto, na data da sobrescrição, as atribuições devem ser feitas aos requerentes numa base proporcional. Bull Divulgação de informações financeiras não auditadas com relatório de revisão limitada: De acordo com os requisitos de divulgação especificados pela SEBI, as empresas que planejam fazer uma emissão de títulos de dívida são obrigatoriamente obrigadas a fornecer demonstrações financeiras auditadas não superiores a 6 meses a partir da data do seu prospecto. Os emitentes de dívida listados, que estão em conformidade com os acordos de listagem, têm agora permissão para divulgar suas demonstrações financeiras não auditadas com um relatório de revisão limitada para o referido período, em vez de financeiras auditadas, sujeitas às revelações necessárias no Documento da Oferta incluindo fatores de risco. As disposições sobre a retirada do requisito de upload de ofertas sobre prioridade de data e divulgação de informações financeiras não auditadas com relatório de revisão limitada seriam aplicáveis à emissão de títulos de dívida arquivados na bolsa de valores designada em ou após 1º de novembro de 2013. bull Divulgação de detalhes de contato da Debênture Fiduciários no Relatório Anual: Decide-se que o Acordo de Listagem de Títulos de Dívida será alterado pela adição de uma cláusula especificando que as empresas que listaram seus Títulos de Dívida divulgariam o nome de seu fiduciário de debêntures juntamente com seus detalhes de contato no relatório anual, bem como Em seu site. Esta disposição seria aplicável a todas as bolsas de valores a partir de 1 de Dezembro de 2013. 2.2.1 Securities and Exchange Board da Índia (Listagem de Valores Mobiliários Especificados em Plataforma de Negociação Institucional) Regulamentos, 2013 A SEBI, em 8 de Outubro de 2013, emitiu um novo regulamento, Será chamado como Securities and Exchange Board da Índia (Lista de Valores Mobiliários Especificados em Plataforma de Negociação Institucional) Regulamentos, 2013. Alterações foram introduzidas aos seguintes regulamentos: bull Emissão de Capital e Requisitos de Divulgação, Regulamentos, 2009 Um novo capítulo XC foi Incluídas, na Listagem e Emissão de Capital por Pequenas e Médias Empresas em Plataforma Institucional de Negociação sem Oferta Pública Inicial. A nova cláusula seria aplicável apenas às pequenas e médias empresas cujos valores mobiliários não sejam cotados em bolsa de valores reconhecida e que busquem a cotação dos seus títulos especificados na Plataforma de Negociação Institucional (ITP). As normas de elegibilidade, processo de busca de listagem, mínimo promotersrsquo exploração, saída etc foram previstas nos regulamentos ICDR. Estes foram tratados na página 8 desta Atualização Regulatória, que trata da Circular SEBIrsquos sobre o assunto. Um novo cronograma foi inserido como Anexo XIXA, que deve ser conhecido como Documento de Informação, que deverá conter os seguintes detalhes: a. Descrição dos negócios Detalhes relativos ao desenvolvimento de negócios, suas subsidiárias, produtos e serviços prestados, principais segmentos de mercado e de destino, fontes de matéria-prima, duração e efeito de todas as patentes, marcas, licenças, franquias e concessões detidas pela empresa, Demonstração das demonstrações financeiras, ou seja, balanço, resultados e fluxos de caixa do ano anterior. B. Estrutura de capital Detalhes da estrutura de capital em forma de tabela, com detalhes sobre o capital social, a conta de prémio de emissão, a quota atribuída. C. Descrição do imóvel Detalhes relativos a activos fixos, direitos de propriedade intelectual, detalhes de compra do imóvel, custo de aquisição do imóvel, detalhes relacionados com o título, etc. d. Fatores de risco Os fatores de risco podem incluir, entre outras coisas, o seguinte: o Falta de histórico operacional o A falta de operações lucrativas em períodos recentes o A posição financeira o O negócio ou negócio proposto o A falta de um mercado para a empresa Acções ou valores mobiliários convertíveis ou susceptíveis de serem exercidos para acções e. Propriedade de certos proprietários beneficiários e administração Informações sobre a participação acionária de um beneficiário efetivo e sobre qualquer acordo significativo de acionistas e seus detalhes. F. Diretores e Diretores Executivos Uma lista detalhada de diretores e executivos incluindo nome, qualificação, idade. Experiência de trabalho, a sua posição e mandato. G. Promotores Um perfil completo dos promotores incluindo seu nome, idade, endereços pessoais, qualificações educacionais, experiência no negócio ou emprego e na linha de negócios proposta no documento de oferta, cargos ocupados no passado, diretoria (s) realizada (s) . H. Other ventures of each promoter, their business and financial activities, photograph, voter identification number, driving license number etc. Details of change in control or management of the promoter companies, if any, including details of the persons who held the controlling interest in the three years immediately preceding the filing the draft offer document. Eu. Certain relationships and related transactions, and director independence Details of transaction with any related parties, in which the company was or is to be a participant and the amount involved exceeded twenty five thousand rupees. J. Legal proceedings Legal proceedings which are pending where the company or any of its subsidiaries is a party or in which any of their property is the subject to litigation. K. Declaration The Board of Directors, Chief Executive Officer and Chief Financial Officer of the Company would be required to approve and sign the draft information document and the final information document. bull Substantial Acquisition of Shares and Takeovers, Regulations, 2011 The following amendments have been introduced: A new provision has been introduced in Regulation (3) which exempts any direct and indirect acquisition of shares or voting rights in, or control over a company listed on the ITP of a recognised stock exchange from the provisions of these Regulations. bull Delisting of Equity Shares, Regulations, 2009 A new provision has been introduced in Regulation 3, after sub regulation (1) stipulating that the t delisting regulations shall not apply to securities listed on the institutional trading platform of a recognised stock exchange. 2.3.1 Notification under section 16 and 28 of securities contracts (Regulation) Act, 1956 On 3rd October 2013, SEBI issued a notification under Section 16 and 28 of the Securities Contracts (Regulation) Act, 1956 (SCRA). In terms of the same, no person in the territory to which the SCRA extends shall enter into any contract for sale or purchase of securities, except the following transactions, unless permission has been obtained from SEBI. The earlier notification dated 1st March 2000, stands rescinded except for acts done or omitted before such rescission. bull Spot delivery contract bull Contract for sale or purchase of securities or contracts in derivatives, as permissible under SCRA or the SEBI Act bull Contracts for pre-emption including right of first refusal, or tag-along or drag - along rights contained in shareholders agreements or articles of association of companies bull Contracts in shareholders agreements or articles of association of companies for purchase or sale of securities pursuant to exercise of an option. where a. The underlying securities are held continuously by the selling party for a minimum period of one year from the date of entering into a contract b. The price or consideration payable is in compliance with applicable laws and c. The contract is settled by way of actual delivery of the underlying securities. The above contracts need to be compliance with the provisions of FEMA, 1999. It has been further specified that any contract for sale or purchase of government securities, gold related securities, money market securities, contracts in currency derivatives, interest rate derivatives and ready forward contracts in debt securities shall be in compliance with the SCRA, SEBI Act, rules, guidelines and notification issued by RBI. Guidelines on ECBs 1. ECB refer to commercial loans in the form of bank loans, buyers credit, suppliers credit, securitised instruments (e. g. floating rate notes and fixed rate bonds) availed from non-resident lenders with minimum average maturity of 3 years. ECB can be accessed under two routes, viz. (i) Automatic Route outlined in paragraph 1(A) and (ii) Approval Route indicated in paragraph 1(B). ECBs can be accessed under two routes, viz., Automatic Route and The following types of proposals for ECBs are covered under the Automatic Route. Eligible borrowers: Corporates, including those in the hotel, hospital, software sectors (registered under the Companies Act, 1956) and Infrastructure Finance Companies (IFCs) except financial intermediaries, such as banks, financial institutions (FIs), Housing Finance Companies (HFCs) and Non-Banking Financial Companies (NBFCs) are eligible to raise ECB. Individuals, Trusts and Non-Profit making organizations are not eligible to raise ECB. Units in Special Economic Zones (SEZ) are allowed to raise ECB for their own requirement. Non-Government Organizations (NGOs) engaged in micro finance activities are eligible to avail of ECB. Such NGOs (i) should have a satisfactory borrowing relationship for at least 3 years with a scheduled commercial bank authorized to deal in foreign exchange in India and (ii) would require a certificate of due diligence on fit and proper status of the Board/ Committee of management of the borrowing entity from the designated AD bank. Micro Finance Institutions (MFIs) engaged in micro finance activities are eligible to avail of ECBs. MFIs registered under the Societies Registration Act, 1860, MFIs registered under Indian Trust Act, 1882, MFIs registered either under the conventional state-level cooperative acts, the national level multi-state cooperative legislation or under the new state-level mutually aided cooperative acts (MACS Act) and not being a co-operative bank, Non-Banking Financial Companies (NBFCs) categorized as Non Banking Financial Company-Micro Finance Institutions (NBFC-MFIs) and complying with the norms prescribed and are involved in micro finance activities. Recognised Lenders: Borrowers can raise ECB from internationally recognized sources such as international banks international capital markets multilateral financial institutions (such as IFC, ADB, CDC, etc.) / regional financial institutions and Government owned development financial institutions, (iv) export credit agencies suppliers of equipments foreign collaborators foreign equity holders (other than erstwhile Overseas Corporate Bodies (OCBs). Amount and Maturity: The maximum amount of ECB which can be raised by a corporate other than those in the hotel, hospital and software sectors is USD 750 million or its equivalent during a financial year. Corporates in the services sector viz. hotels, hospitals and software sector are allowed to avail of ECB up to USD 200 million or its equivalent in a financial year for meeting foreign currency and/ or Rupee capital expenditure for permissible end-uses. The proceeds of the ECBs should not be used for acquisition of land.. ECB up to USD 20 million or its equivalent in a financial year with minimum average maturity of three years. ECB above USD 20 million or equivalent and up to USD 750 million or its equivalent with a minimum average maturity of five years. NGOs engaged in micro finance activities and Micro Finance Institutions (MFIs) can raise ECB up to USD 10 million or its equivalent during a financial year. Designated AD bank has to ensure that at the time of drawdown the forex exposure of the borrower is fully hedged. All-in-cost ceilings: All-in-cost includes rate of interest, other fees and expenses in foreign currency except commitment fee, pre-payment fee, and fees payable in Indian Rupees. The payment of withholding tax in Indian Rupees is excluded for calculating the all-in-cost. The all-in-cost ceilings for ECB are reviewed from time to time. The following ceilings are valid until reviewed. Average Maturity Period All-in-cost Ceilings over 6 month LIBOR Three years and up to five years 350 basis points More than five years 500 basis points for the respective currency of borrowing or applicable benchmark In the case of fixed rate loans, the swap cost plus margin should be the equivalent of the floating rate plus the applicable margin. ECB can be raised for investment such as import of capital goods (as classified by DGFT in the Foreign Trade Policy), new projects, modernization/expansion of existing production units in real sector - industrial sector including small and medium enterprises (SME), infrastructure sector and specified service sectors namely hotel, hospital, software in India. Overseas direct investment in Joint Ventures (JV)/ Wholly Owned Subsidiaries (WOS) subject to the existing guidelines on Indian Direct Investment in JV/ WOS abroad. Utilization of ECB proceeds is permitted for first stage acquisition of shares in the disinvestment process and also in the mandatory second stage offer to the public under the Governments disinvestment programme of PSU shares. For lending to self-help groups or for micro-credit or for bonafide micro finance activity including capacity building by NGOs engaged in micro finance activities. Payment for Spectrum Allocation. Infrastructure Finance Companies (IFCs) i. e. Non Banking Financial Companies (NBFCs) categorized as IFCs by the Reserve Bank, are permitted to avail of ECBs, including the outstanding ECBs, up to 50 per cent of their owned funds, for on-lending to the infrastructure sector as defined under the ECB policy, subject to their complying with the following conditions: i) compliance with the norms prescribed in the DNBS Circular DNBS. PD. CCNo.168 / 03.02.089 / 2009-10 dated February 12, 2010 ii) hedging of the currency risk in full. Designated Authorised Dealer should ensure compliance with the extant norms while certifying the ECB application. Interest During Construction (IDC) for Indian companies which are in the infrastructure sector, where infrastructure is defined as per the extant ECB guidelines, subject to IDC being capitalized and forming part of the project cost. Maintenance and operations of toll systems for roads and highways for capital expenditure provided they form part of the original project. For on-lending or investment in capital market or acquiring a company (or a part thereof) in India by a corporate investment in Special Purpose Vehicles (SPVs), Money Market Mutual Funds (MMMFs), etc. are also considered as investment in capital markets). for real estate sector for working capital, general corporate purpose and repayment of existing Rupee loans. Issuance of guarantee, standby letter of credit, letter of undertaking or letter of comfort by banks, Financial Institutions and Non-Banking Financial Companies (NBFCs) from India relating to ECB is not permitted. The choice of security to be provided to the lender/supplier is left to the borrower. However, creation of charge over immoveable assets and financial securities, such as shares, in favour of the overseas lender is subject to Regulation 8 of Notification No. FEMA 21/RB-2000 dated May 3, 2000 and Regulation 3 of Notification No. FEMA 20/RB-2000 dated May 3, 2000, respectively, as amended from time to time. AD Category - I banks have been delegated powers to convey no objection under the Foreign Exchange Management Act (FEMA), 1999 for creation of charge on immovable assets, financial securities and issue of corporate or personal guarantees in favour of overseas lender / security trustee, to secure the ECB to be raised by the borrower. Borrowers may enter into loan agreement complying with the ECB guidelines with recognised lender for raising ECB under Automatic Route without the prior approval of the Reserve Bank. The borrower must obtain a Loan Registration Number (LRN) from the Reserve Bank of India before drawing down the ECB. The procedure for obtaining LRN is detailed in para II (i) (b). The following types of proposals for ECB are covered under the Approval Route: On lending by the EXIM Bank for specific purposes will be considered on a case by case basis. Banks and financial institutions which had participated in the textile or steel sector restructuring package as approved by the Government are also permitted to the extent of their investment in the package and assessment by the Reserve Bank based on prudential norms. Any ECB availed for this purpose so far will be deducted from their entitlement. ECB with minimum average maturity of 5 years by Non-Banking Financial Companies (NBFCs) from multilateral financial institutions, reputable regional financial institutions, official export credit agencies and international banks to finance import of infrastructure equipment for leasing to infrastructure projects. Infrastructure Finance Companies (IFCs) i. e. Non-Banking Financial Companies (NBFCs), categorized as IFCs, by the Reserve Bank, are permitted to avail of ECBs, including the outstanding ECBs, beyond 50 per cent of their owned funds, for on-lending to the infrastructure sector as defined under the ECB policy, subject to their complying with the following conditions:compliance with the norms prescribed in the DNBS Circular DNBS. PD. CCNo.168 / 03.02.089 /2009-10 dated February 12, 2010 ii) hedging of the currency risk in full. Designated Authorised Dealer should ensure compliance with the extant norms while certifying the ECB application. Foreign Currency Convertible Bonds (FCCBs) by Housing Finance Companies satisfying the following minimum criteria: (i) the minimum net worth of the financial intermediary during the previous three years shall not be less than Rs. 500 crore, (ii) a listing on the BSE or NSE, (iii) minimum size of FCCB is USD 200 million and (iv) the applicant should submit the purpose / plan of utilization of funds. Special Purpose Vehicles, or any other entity notified by the Reserve Bank, set up to finance infrastructure companies / projects exclusively, will be treated as Financial Institutions and ECB by such entities will be considered under the Approval Route. Multi-State Co-operative Societies engaged in manufacturing activity and satisfying the following criteria i) the Co-operative Society is financially solvent and ii) the Co-operative Society submits its up-to-date audited balance sheet. SEZ developers can avail of ECBs for providing infrastructure facilities within SEZ, as defined in the extant ECB policy like (i) power, (ii) telecommunication, (iii) railways, (iv) roads including bridges, (v) sea port and airport, (vi) industrial parks, (vii) urban infrastructure (water supply, sanitation and sewage projects), (viii) mining, exploration and refining and (ix) cold storage or cold room facility, including for farm level pre-cooling, for preservation or storage of agricultural and allied produce, marine products and meat. Corporates in the services sector viz. hotels, hospitals and software sector can avail of ECB beyond USD 200 million per financial year. Corporates which have violated the extant ECB policy and are under investigation by the Reserve Bank and / or Directorate of Enforcement are allowed to avail of ECB only under the approval route. Cases falling outside the purview of the automatic route limits and maturity period indicated at paragraph A (iii). Eligible borrowers under the automatic route other than corporates in the services sector viz. hotel, hospital and software can avail of ECB beyond USD 750 million or equivalent per financial year Recognised Lenders: Borrowers can raise ECB from internationally recognised sources such as (i) international banks, (ii) international capital markets, (iii) multilateral financial institutions (such as IFC, ADB, CDC, etc.)/ regional financial institutions and Government owned development financial institutions, (iv) export credit agencies, (v) suppliers of equipment, (vi) foreign collaborators and (vii) foreign equity holders (other than erstwhile OCBs). From foreign equity holder where the minimum paid-up equity held directly by the foreign equity lender is 25 per cent but ECBs: equity ratio exceeds 4:1 (i. e. the proposed ECB exceeds four times the direct foreign equity holding). Amount and Maturity : Eligible borrowers under the automatic route other than corporates in the services sector viz. hotel, hospital and software can avail of ECB beyond USD 750 million or equivalent per financial year. Corporates in the services sector viz. hotels, hospitals and software sector are allowed to avail of ECB beyond USD 200 million or its equivalent in a financial year for meeting foreign currency and/ or Rupee capital expenditure for permissible end-uses. The proceeds of the ECBs should not be used for acquisition of land. Indian companies which are in the infrastructure sector, as defined under the extant ECB guidelines, can avail of ECBs in Renminbi (RMB), subject to an annual ceiling of USD one billion for the entire sector, pending further review All-in-cost includes rate of interest, other fees and expenses in foreign currency except commitment fee, pre-payment fee, and fees payable in Indian Rupees. The payment of withholding tax in Indian Rupees is excluded for calculating the all-in-cost. The all-in-cost ceilings for ECB are reviewed from time to time. The following ceilings are valid until reviewed. Average Maturity Period All-in-cost Ceilings over 6 month LIBOR Three years and up to five years 350 basis points More than five years 500 basis points for the respective currency of borrowing or applicable benchmark In the case of fixed rate loans, the swap cost plus margin should be the equivalent of the floating rate plus the applicable margin. ECB can be raised only for investment such as import of capital goods (as classified by DGFT in the Foreign Trade Policy), implementation of new projects, modernization/expansion of existing production units in real sector - industrial sector including small and medium enterprises (SME) and infrastructure sector - in India. Infrastructure sector is defined as (i) power (ii) telecommunication (iii) railways (iv) roads including bridges (v) sea port and airport (vi) industrial parks (vii) urban infrastructure (water supply, sanitation and sewage projects) (viii) mining, exploration and refining and (ix) cold storage or cold room facility, including for farm level pre-cooling, for preservation or storage of agricultural and allied produce, marine products and meat. Overseas direct investment in Joint Ventures (JV)/Wholly Owned Subsidiaries (WOS) subject to the existing guidelines on Indian Direct Investment in JV/WOS abroad.. The payment by eligible borrowers in the Telecom sector, for spectrum allocation may, initially, be met out of Rupee resources by the successful bidders, to be refinanced with a long-term ECB, under the approval route, subject to the following conditions: The ECB should be raised within 12 months from the date of payment of the final installment to the Government The designated AD - Category I bank should monitor the end-use of funds Banks in India will not be permitted to provide any form of guarantees and All other conditions of ECB, such as eligible borrower, recognized lender, all-in-cost, average maturity, etc, should be complied with. The first stage acquisition of shares in the disinvestment process and also in the mandatory second stage offer to the public under the Governmentrsquos disinvestment programme of PSU shares. Repayment of Rupee loans availed of from domestic banking system . Indian companies which are in the infrastructure sector( except companies in the power sector), as defined under the extant ECB guidelines. are permitted to utilize 25 per cent of the fresh ECB raised by them towards refinancing of the Rupee loan/s availed by them from the domestic banking system, subject to the following conditions:- at least 75 per cent of the fresh ECB proposed to be raised should be utilized for capital expenditure towards a new infrastructure project(s) in respect of remaining 25 per cent, the refinance shall only be utilized for repayment of the Rupee loan availed of for capital expenditure of earlier completed infrastructure project(s) and the refinance shall be utilized only for the Rupee loans which are outstanding in the books of the financing bank concerned. Companies in the power sector are permitted to utilize up to 40 per cent of the fresh ECB raised by them towards refinancing of the Rupee loan/s availed by them from the domestic banking system subject to the condition that at least 60 per cent of the fresh ECB proposed to be raised should be utilized for fresh capital expenditure for infrastructure project(s). Interest During Construction (IDC) for Indian companies which are in the infrastructure sector, as defined under the extant ECB guidelines subject to IDC being capitalized and forming part of the project cost. Bridge Finance . Indian companies which are in the infrastructure sector, as defined under the extant ECB policy are permitted to import capital goods by availing of short term credit (including buyers / suppliers credit) in the nature of bridge finance, under the approval route, subject to the following conditions:- the bridge finance shall be replaced with a long term ECB the long term ECB shall comply with all the extant ECB norms and prior approval shall be sought from the Reserve Bank for replacing the bridge finance with a long term ECB. ECB for working capital for civil aviation sector . Airline companies registered under the Companies Act, 1956 and possessing scheduled operator permit license from DGCA for passenger transportation are eligible to avail of ECB for working capital. Such ECBs will be allowed based on the cash flow, foreign exchange earnings and the capability to service the debt and the ECBs can be raised with a minimum average maturity period of three years. The overall ECB ceiling for the entire civil aviation sector would be USD one billion and the maximum permissible ECB that can be availed by an individual airline company will be USD 300 million. This limit can be utilized for working capital as well as refinancing of the outstanding working capital Rupee loan(s) availed of from the domestic banking system. ECB availed for working capital/refinancing of working capital as above will not be allowed to be rolled over. The foreign exchange for repayment of ECB should not be accessed from Indian markets and the liability should be extinguished only out of the foreign exchange earnings of the borrowing company. Repayment of Rupee loans and/or fresh Rupee capital expenditure for companies with forex earnings . Indian companies in the manufacturing and infrastructure sector can avail of ECBs for repayment of Rupee loans availed of for capital expenditure from the domestic banking system which are still outstanding and/or fresh Rupee capital expenditure provided they are consistent foreign exchange earners during the past three financial years and not in the default list/caution list of the Reserve Bank of India. The overall limit for such ECBs is USD 10 billion and the maximum permissible ECB that can be availed of by an individual company will be limited to 50 per cent of the average annual export earnings realized during the past three financial years. The foreign exchange for repayment of ECB should not be accessed from Indian markets and and the liability arising out of ECB should be extinguished only out of the foreign exchange earnings of the borrowing company. End-uses not permitted : For on-lending or investment in capital market or acquiring a company (or a part thereof) in India by a corporate except Infrastructure Finance Companies (IFCs), banks and financial institutions eligible under paragraph I (B) (i) (a), (b) and (d). For real estate. For working capital and general corporate purpose and repayment of existing Rupee loans except as specifically permitted as per details given hereinabove, Guarantees: I ssuance of guarantee, standby letter of credit, letter of undertaking or letter of comfort by banks, financial institutions and NBFCs relating to ECB is not normally permitted. Applications for providing guarantee/standby letter of credit or letter of comfort by banks, financial institutions relating to ECB in the case of SME will be considered on merit subject to prudential norms. Issuance of guarantee, standby letter of credit, letter of undertaking or letter of comfort by banks, financial institutions and NBFCs relating to ECB is not normally permitted. Applications for providing guarantee/standby letter of credit or letter of comfort by banks, financial institutions relating to ECB in the case of SME will be considered on merit subject to prudential norms. With a view to facilitating capacity expansion and technological upgradation in Indian textile industry, issue of guarantees, standby letters of credit, letters of undertaking and letters of comfort by banks in respect of ECB by textile companies for modernization or expansion of textile units will be considered under the Approval Route subject to prudential norms. The choice of security to be provided to the lender / supplier is left to the borrower. However, creation of charge over immovable assets and financial securities, such as shares, in favour of the overseas lender is subject to Regulation 8 of Notification No. FEMA 21/RB-2000 dated May 3, 2000 and Regulation 3 of Notification No. FEMA 20/RB-2000 dated May 3, 2000 as amended from time to time, respectively. Powers have been delegated to Authorised Dealer Category I banks to issue necessary NOCs under FEMA as detailed in para I (A) (viii) ibid. Parking of ECB proceeds: Borrowers are permitted to either keep ECB proceeds abroad or to remit these funds to India, pending utilization for permissible end-uses. ECB proceeds parked overseas can be invested in the following liquid assets (a) deposits or Certificate of Deposit or other products offered by banks rated not less than AA (-) by Standard and Poor/ Fitch IBCA or Aa3 by Moodyrsquos (b) Treasury bills and other monetary instruments of one year maturity having minimum rating as indicated above and (c) deposits with overseas branches / subsidiaries of Indian banks abroad. The funds should be invested in such a way that the investments can be liquidated as and when funds are required by the borrower in India. ECB funds may also be repatriated to India for credit to the borrowersrsquo Rupee accounts with AD Category I banks in India pending utilization for permissible end-uses. The proceeds of the ECB raised abroad meant for Rupee expenditure in India, such as, local sourcing of capital goods, on-lending to Self-Help Groups or for micro credit, payment for spectrum allocation, etc. should be repatriated immediately for credit to their Rupee accounts with AD Category I banks in India. In other words, ECB proceeds meant only for foreign currency expenditure can be retained abroad pending utilization. The rupee funds, however, will not be permitted to be used for investment in capital markets, real estate or for inter-corporate lending. Prepayment of ECB up to USD 500 million may be allowed by the AD bank without prior approval of the Reserve Bank subject to compliance with the stipulated minimum average maturity period as applicable to the loan. Pre-payment of ECB for amounts exceeding USD 500 million would be considered by the Reserve Bank under the Approval Route. Refinance of existing ECB: Existing ECB may be refinanced by raising a fresh ECB at a higher all-in-cost subject to the condition that the enhanced all-in-cost does not exceed the all-in-cost ceiling prescribed as per the extant guidelines. An existing ECB can be rescheduled at a higher all-in-cost subject to the condition that the enhanced all-in-cost does not exceed the all-in-cost ceiling prescribed as per the extant guidelines. The designated AD bank has general permission to make remittances of installments of principal, interest and other charges in conformity with the ECB guidelines issued by Government / Reserve Bank from time to time. The policy for ECB is also applicable to FCCB in all respects. REPORTING ARRANGEMENTS AND DISSEMINATION OF INFORMATION Reporting Arrangements With a view to simplify the procedure, submission of copy of loan agreement is dispensed with. Borrowers are required to submit Form 83, in duplicate, certified by the Company Secretary (CS) or Chartered Accountant (CA) to the designated AD. One copy is to be forwarded by the designated AD to the Director, Balance of Payments Statistics Division, Department of Statistical Analysis and Computer Services (DESACS), Reserve Bank of India, Bandra-Kurla Complex, Mumbai 400 051 for allotment of loan registration number. The borrower can draw-down the loan only after obtaining the loan registration number from DESACS, RBI. Borrowers are required to submit ECB-2 Return certified by the designated AD on monthly basis so as to reach DESACS, RBI within seven working days from the close of month to which it relates. Simplification of Procedure:Reserve Bank of India under its circular no RBI/2011-12/169 A. P. (DIR Series) Circular no 11 dated 07-09-2011 has simplified the procedure for change of lender for an existing ECB, and decided to delegate powers to AD Category I Banks to approve request from ECB borrowers subject to certain conditions as mentioned in the circular. (3) Trade Credits for Imports into India Trade Credits (TC) refer to credits extended for imports directly by the overseas supplier, bank and financial institution for original maturity of less than three years. Depending on the source of finance, such trade credits include suppliersrsquo credit or buyersrsquo credit. Suppliersrsquo credit relates to credit for imports in to India extended by the overseas supplier, while buyersrsquo credit refers to loans for payment of imports in to India arranged by the importer from a bank or financial institution outside India for maturity of less than three years. It may be noted that buyersrsquo credit and suppliersrsquo credit for three years and above come under the category of External Commercial Borrowings (ECB) which are governed by ECB guidelines. Period and Rate of Interest . Trade credits for imports into India up to US 20 million per import transaction for import of all items (permissible under the EXIM POLICY) with a maturity period (from the date of shipment) up to one year. For import of capital goods, trade credits up to USD 20 million per import transaction with a maturity period of more than one year and less than three years. No roll-over/ extension will be permitted beyond the permissible period. Period and Rate of Interest . Rate of Interest Six months LIBOR Objectives Of Monetary Policy Of India Finance Essay Monetary policy is a regulatory policy by which the central bank or monetary authority of a country controls the supply of money, availability of bank credit and cost of money, that is, the rate of Interest. Monetary policy / monetary management is regarded as an important tool of economic management in India. RBI controls the supply of money and bank credit. The Central bank has the duty to see that legitimate credit requirements are met and at the same credit is not used for unproductive and speculative purposes. RBI rightly calls its credit policy as one of controlled expansion. B)OBJECTIVES OF MONETARY POLICY OF INDIA :- The main objective of monetary policy in India is growth with stability. Monetary Management regulates availability, cost and use of money and credit. It also brings institutional changes in the financial sector of the economy. Following are the main objectives of monetary policy in India :- 1. Growth With Stability :- Traditionally, RBIs monetary policy was focused on controlling inflation through contraction of money supply and credit. This resulted in poor growth performance. Thus, RBI have now adopted the policy of Growth with Stability. This means sufficient credit will be available for growing needs of different sectors of economy and at the same time, inflation will be controlled with in a certain limit. 2. Regulation, Supervision And Development Of Financial Stability :- Financial stability means the ability of the economy to absorb shocks and maintain confidence in financial system. Threats to financial stability can come from internal and external shocks. Such shocks can destabilize the countrys financial system. Thus, greater importance is being given to RBIs role in maintaining confidence in financial system through proper regulation and controls, without sacrificing the objective of growth. Therefore, RBI is focusing on regulation, supervision and development of financial system. 3. Promoting Priority Sector :- Priority sector includes agriculture, export and small scale enterprises and weaker section of population. RBI with the help of bank provides timely and adequately credit at affordable cost of weaker sections and low income groups. RBI, along with NABARD, is focusing on microfinance through the promotion of Self Help groups and other institutions. 4. Generation Of Employment :- Monetary policy helps in employment generation by influencing the rate of investment and allocation of investment among various economic activities of different labour Intensities. 5. External Stability :- With the growth of imports and exports Indias linkages with global economy are getting stronger. Earlier, RBI controlled foreign exchange market by determining eaxchange rate. Now, RBI has only indirect control over external stability through the mechanism of managed Flexibility, where it influences exchange rate by buying and selling foreign currencies in open market. 6. Encouraging Savings And Investments :- RBI by offering attractive interest rates encourage savings in the economy. A high rate of saving promotes investment. Thus the monetary management by influencing rates of interest can influence saving mobilization in the country. 7. Redistribution Of income And Wealth :- By control of inflation and deployment of credit to weaker sectors of society the monetary policy may redistribute income and wealth favouring to weaker sections. 8. Regulation Of NBFIs:- Non Banking Financial Institutions (NBFIs), like UTI, IDBI, IFCI plays an important role in deployment of credit and mobilization of savings. RBI does not have any direct control on the functioning of such institutions. However it can indirectly affects the policies and functions of NBFIs through its monetary policy. Q.2:Discuss / Explain the various functions of RBI. Ans. A. RESERVE BANK OF INDIA (RBI) :- The Reserve Bank of India is the central bank of India it was established as a shareholders bank on 1st April 1935. Its share capital was Rs. 5 crore, divided in to 5 lakhs fully paid up shares of Rs. 100 each. On 1st January 1949 it was nationalized. Its headquarters is at Mumbai. RBI, like any other bank performs almost all traditional Central banking functions. Due to countrys development it has also undertaken developmental and promotional functions. A. FUNCTIONS OF RBI :- RBI performs many functions, some of them are:- 1. Issue Of Currency Notes :- Under section 22 of RBI Act, the bank has the sole right to issue currency notes of all denominations except one rupee coins and notes. The one-rupee notes and coins and small coins are issued by Central Government and their distribution is undertaken by RBI as the agent of the government. The RBI has a separate issue department which is entrusted with the issue of currency notes. 2. Banker To The Government :- The RBI acts as a banker agent and adviser to the government. It has obligation to transact the banking business of Central Government as well as State Governments. E. g.:- RBI receives and makes all payments on behalf of government, remits its funds, buys and sells foreign currencies for it and gives it advice on all banking matters. RBI helps the Government both Central and state to float new loans and manage public debt. The bank makes ways and meets advances of the government. On behalf of central government it sells treasury bills and thereby provides short-term finance. 3. Bankers bank And Lender Off Last Resort :- RBI acts as a banker to other banks. It provides financial assistance to scheduled banks and state co-operative banks in form of rediscounting of eligible bills and loans and advances against approved securities. RBI acts as a lender of last resort. It provides funds to bank when they fail to get it from other sources. It also acts as a clearing house. Through RBI, banks make interbanks payments. 4. Controller Of Credit :- RBI has power to control the volume of credit created by banks. The RBI through its various quantitative and qualitative techniques regulates total supply of money and bank credit in the interest of economy. RBI pumps in money during busy season and withdraws money during slack season. 5. Exchange control And Custodian Of Foreign Reserve :- RBI has the responsibility of maintaining fixed exchange rates with all member countries of IMF. For this, RBI has centralized all foreign exchange reserves (FOREX). RBI functions as custodian of nations foreign exchange reserves. It has to maintain external valu of Rupee. RBI achieves this aim through appropriate monetary fiscal and trade policies and exchange control. 6. Collection And Publication Of Data :- The RBI collects and complies statistical information on banking and financial operations of the economy. The Reserve Bank Of India Bulletian is a monthly publication. It not only provides information, but also results of important studies and investigations conducted by reserve bank are given. The Report on currency and finance is an annual publication. It provides review of various developments of economic and financial importance. 7. Regulatory And Supervisory Functions :- The RBI has wide powers of supervision and control over commercial and co-operative banks, relating to licensing, establishment, branch expansion, liquidity of Assets, management and methods of working, amalgamation, re-construction and liquidation. The supervisory functions of RBI have helped a great in improving the standard of banking in India to develop on sound lines and to improve the methods of their operation. 8. Clearing House Functions :- The RBI acts as a clearing house for all member banks. This avoids unnecessary transfer of funds between the various banks. 9. Development And Promotional Functions :- The RBI has helped in setting up Industrial Finance Corporations of India (IFCI), State Financial Corporations (SFCs), Deposit Insurance Corporation, Agricultural Refinance and Development Corporation (ARDC), units Trust of India (UTI) etc. these institutions were set up to mobilize savings, promote saving habits and to provide industrial and agricultural finance. RBI has a special Agricultural Credit Department (ACD) which studies the problems of agricultural credit. For this Regional Rural banks, Co-operative, NABARD etc. were established. The RBI has also taken measures to promote organized bill market to create elasticity in Indian Money Market in order to satisfy seasonal credit needs. Thus RBI has contributed to economic growth by promoting rural credit, industrial financing, export trade etc. Q.3): Explain the quantitative and selective methods ofcredit controlused by RBI. OR Explain the Monetary Policy of RBI Imeasures takenby RBI to control credit. OR Write note on Quantitative I Selective methods ofcredit control. OR Explain Monetary Management of RBI. Ans. A) MONETARY POLICY OF RBI :- The Monetary Policy of RBI is not merely one of credit restriction, but it has also the duty to see that legitimate credit requirements are met and at the same time credit is not used for unproductive and speculative purposes RBI has various weapons of monetary control and by using them, it hopes to achieve its monetary policy. I) General I Quantitative Credit Control Methods :- In India, the legal framework of RBIs control over the credit structure has been provided Under Reserve Bank of India Act, 1934 and the Banking RegulationAct, 1949. Quantitative credit controls are used to maintain proper quantity of credit o money supply in market. Some of the important general credit control methods are:- 1. Bank Rate Policy :- Bank rate is the rate at which the Central bank lends money to the commercial banks for their liquidity requirements. Bank rate is also called discount rate. In other words bank rate is the rate at which the central bank rediscounts eligible papers (like approved securities, bills of exchange, commercial papers etc) held by commercial banks. Bank rate is important because its is the pace setter to other marketrates of interest. Bank rates have been changed several times by RBI to control inflation and recession. By 2003, the bank rate has been reduced to 6 p. a. 2. Open market operations :- It refers to buying and selling of government securities in open market in order to expand or contract the amount of money in the banking system. This technique is superior to bank rate policy. Purchases inject money into the banking system while sale of securities do the opposite. During last two decades the RBI has been undertaking switch operations. These involve the purchase of one loan against the sale of another or, vice-versa. This policy aims at preventing unrestricted increase in liquidity. 3. Cash Reserve Ratio (CRR) The Gash Reserve Ratio (CRR) is an effective instrument of credit control. Under the RBl Act of, l934 every commercial bank has to keep certain minimum cash reserves with RBI. The RBI is empowered to vary the CRR between 3 and 15. A high CRR reduces the cash for lending and a low CRR increases the cash for lending. The CRR has been brought down from 15 in 1991 to 7.5 in May 2001. It further reduced to 5.5 in December 2001. It stood at 5 on January 2009. In January 2010, RBI increased the CRR from 5 to 5.75. It further increased in April 2010 to 6 as inflationary pressures had started building up in the economy. As of March 2011, CRR is 6. 4. Statutory Liquidity Ratio (SLR) Under SLR, the government has imposed an obligation on the banks to, maintain a certain ratio to its total deposits with RBI in the form of liquid assets like cash, gold and other securities. The RBIhas power to fix SLR in the range of 25 and 40 between 1990 and 1992 SLR was as high as 38.5. Narasimham Committee did not favour maintenance of high SLR. The SLR was lowered down to 25 from 10thOctober 1997.It was further reduced to 24 on November 2008. At present it is 25. 5. Repo And Reverse Repo Rates In determining interest rate trends, the repo and reverse repo rates are becoming important. Repo means Sale and Repurchase Agreement. Repo is a swap deal involving the immediate Sale of Securities and simultaneous purchase of those securities at a future date, at a predetermined price. Repo rate helps commercial banks to acquire funds from RBI by selling securities and also agreeing to repurchase at a later date. Reverse repo rate is the rate that banks get from RBI for parking their short term excess funds with RBI. Repo and reverse repo operations are used by RBI in its Liquidity Adjustment Facility. RBI contracts credit by increasing the repo and reverse repo rates and by decreasing them it expands credit. Repo rate was 6.75 in March 2011 and Reverse repo rate was 5.75 for the same period. On May 2011 RBI announced Monetary Policy for 2011-12. To reduce inflation it hiked repo rate to,7.25 and Reverse repo to 6.25 II) SELECTIVE / QUALITATIVE CREDIT CONTROL METHODS :- Under Selective Credit Control, credit is provided to selectedborrowersfor selected purpose, depending upon the use to which the control try to regulate the quality of credit - the direction towardsthecredit flows. The Selective Controls are :- 1. Ceiling On Credit The Ceilingon level of credit restricts the lending capacity of a bank to grant advances against certain controlled securities. A loan is sanctioned against Collateral Security. Margin means that proportion of the value of security against which loan is not given. Margin against a particular security is reduced or increased in order to encourageor to discourage the flow of credit to a particular sector. It varies from 20 to 80. For agricultural commodities it is as high as 75. Higher the margin lesser will be the loan sanctioned. 3. Discriminatory Interest Rate (DIR) Through DIR, RBI makes credit flow to certain priority or weaker sectors by charging concessional rates of interest. RBI issues supplementary instructions regarding granting of additional credit against sensitive commodities, issue of guarantees, making advances etc. The RBI issues directives to banks regarding advances. Directives are regarding the purpose for which loans may or may not be given. 5. Direct Action It is too severe and is therefore rarely followed. It may involve refusal by RBI to rediscount bills or cancellation of license, if the bank has failed to comply with the directives of RBI. 6. Moral Suasion Under Moral Suasion, RBI issues periodical letters to bank to exercise control over credit in general or advances against particular commodities. Periodic discussions are held with authorities of commercial banks in this respect. Q. 4 :Examine the recent changes that have taken place in RBIs Monetary Policy. (Mar. 11) Ans. A)RECENT CHANGES IN RBIs MONETARY POLICY :- Since 1991 RBIs monetary management has undergone some major changes. 1) Multiple Indicator Approach :- Upto late 1990s, RBI used the Monetary targeting approach to its monetary policy. Monetary targeting refers to a monetary policy strategy aimed at maintaining price stability by focusing on changes in growth of money supply. After 1991 reforms this approach became difficult to follow. So RBI adopted Multiple indicator Approach in which it looks at a variety of economic indicators and monitor their impact on inflation and economic growth. 2) Selective Methods Being Phased Out :- With rapid progress in financial markets, the selective methods of credit control are being slowly phased out. Quantitative methods are becoming more important. 3) Reduction In Reserve Requirements :- In post-reform period the CRR and SLR have been progressively lowered. This has been done as a part of financial sector reforms. As a result, more bank funds have been released for lending. This has led to the growth of economy. 4) Deregulation Of Administered Interest Rate System :- Earlier lending rate of banks was determined by RBI. Since 1990s this system has changed and lending rates are determined by commercial banks on the basis of market forces. 5) Delinking Of Monetary Policy From Budget Deficit :- In1994 government phased out the use of adhoc treasury Bills. These bills were used by government to borrow from RBI to finance fiscal deficit. With phasing out of Bills, RBI would no longer lend to government to meet fiscal deficit. 6) Liquidity Adjustment Facility (LAF):- LAF allows banks to borrow money through repurchase agreement LAF was introduced by RBI during June, 2000, in phases. The funds under LAF are used by banks to meet day-to-day mismatches in liquidity. 7) Provision Of Micro Finance By linking the banking system with Self Help Groups, RBI has introduced the scheme of micro finance for rural poor. Along with NABARD, RBI is promoting various other microfinance institutions. 8) External Sector With globalisation large amount of foreign capital is attracted. To provide stability in financial markets, RBI uses sterlization and LAF to absorb the excess liquidity that comes in with huge inflow of foreign capital. 9) Expectation As A Channel Of Monetary Transmission Traditionally, there were four key channels of monetary policy transmission :-Interest rate, credit availability, asset prices and exchange rate channels. Interest rate is the most dominant transmission channel as any change in monetary policy has immediate effect on it. In recent years fifth channel, Expectation has been added. Future expectations about asset prices, general price and Income levels influence the four traditional channels. Q.5:Discuss RBIs short term Liquidity Management. OR Why has short term Liquidity Management gained importance in post reform India Discuss measures taken by RBI for Management of short term Liquidity. (Mar. 11) Ans. A.RBIS SHORT TERM LIQUIDITY MANAGEMENT :- Liquidity Management of Central bank means supplying to the market the amount of liquidity that is consistent with a desired level of short-term interest rate. It is defined quotas the framework, set of instruments and the rules that the central bank follows in order to manage the amount of money supply to control short term interest rates with the objective of price stabilityquot. In RBIs overall management short term liquidity management occupies a very important place due to following factors:- 1) In financial sector, in 1990s, many reforms were introduced. The important reforms are deregulation of interest rates and exchange rates. Earlier these rates were determined by RBI, after reforms, they are determined by demand and supply. RBI in absence of direct intervention indirectly influences these rates by using multiple indicators approach. 2) Due to liberalization capital flows between countries have increased. From US 118 Million during 1991-92, capital flows to. India rose to US 15 billions in 2004-05. 3) Foreign capital flows have increased employment. It adds to the supply of foreign exchange and have resulted into appreciation of domesticcurrency. With this, theexports have become more expensive. 4) When capital inflows are converted into rupees, they get injected into the economy thereby, increasing the money supply. So to maintain price stability RBI has to mange the exchange rate and Interest rate. B) RBIS MEASURES FOR SHORT TERMLlQUIDITY MANAGEMENT 1. Repo I Reverse Repo To improve short term liquidity management, RBl. introduced repos in December 1992. Repo is Sale and Repurchase Agreement. It is a swap deal involving the immediate Sale of Securities and simultaneously purchase of those securities at a future date, at a predetermined price. Such deals takes place between RBI and banks. Due to lack of demand repos auctions were discontinued in March 1995, they were resumed again in 1997. Reverse repo rate is the rate that banks get from RBI for parking their short term excess funds with RBI. 2. Interim Liquidity Adjustment Facility (ILAR) To develop short term money market Narasimham Committee 1998 recommended LAF. Accordingly in 1999 RBI introduced ILAF. It (ILAF) provided a mechanism for liquidity management through a combination of repos, export credit refinance and collateralised lending facilities supported by Open Market Operations. 3. Liquidity Adjustment Facility (LAP) V RBI introduced-full-fledged LAF. It has been revised further. Under LAF, Reverse repo auctions and Repo auctions are conducted on daily basis. In India, the emergence of LAF was a single biggest factor which helped RBI to manage short term liquidity and maintain interest rate stability. In 2009-10, liquidity absorption through reverse repo reached its peak on 4th September 2009 at Rs. 1,68,215crore. Sterlization means re-cycling of foreign capital inflows to prevent appreciation of domestic currency and to check the inflationary impact of such capital. Sterlization is carried out through open market operations. But Sterlization can also leads to some problems. Thus RBI also, uses a variety of other measures to manage interest rates. 5. Market Stabilization Scheme (MSS):- Till 2003-04 the impact of large capital inflows was managed through day-to-day LAF and OMO. In the process, the government securities available with RBI declined, as they were being used for absorbing excess liquidity. In order to handle these issues, RBI signed a Memorandum of Understanding (MOU) with Government for issuance of Treasury Bills and dated government securities under Market Stabilization Scheme (MSS). These Bills and Securities are used to absorb excess liquidity from market and: maintain stability in foreign exchange market. Q. 6 :Evaluate RBIs Monetary Policy. OR. Give an appraisal (Achievements and Failures) of monetary policy of RBI. Ans. A)EVALUATION OF MONETARY POLICY :- The RBI aims at one time was controlled expansion. On one hand it was taking steps to expand bank credit. On other hand RBI uses quantitative and qualitative methods to control credit. These two contradictory objectives limited the success of monetary policy. The performance of monetary policy can be seen from its achievements and failures, let us discuss. I. Achievements I Positive Aspects Of Monetary Policy :- 1. Short Term Liquidity Management :- RBI has developed various methods to maintain stability in interest rate and exchange rate like LAF, OMO and MSS. RBI has also managed its sterlization operations very well. 2. Financial Stability :- With the help of controls, regulation and supervision mechanism, RBI has been successful in maintaining financial stability. During the period of global crisis it has also been able to maintain macro economic stability. 3. Financial Inclusion :- Along with NABARD, RBI has made a great impact in the growth of microfinance. RBI has supported Self Help Group Model and promoted other microfinance institutions. In India monetary policy is flexible, as it changes with time. RBI has developed new methods of credit control and shifted from monetary targeting to multiple indicator approach. 5. Increase In Growth:- To maintain the growth of economy RBI has used its instruments effectively. At present India has the second highest rate of GDP growth after China. Thus monetary policy has played an important role. 6. Increase In Bank Deposits:- The increase in bank deposits over the years indicates trust and confidence of people in banking sector. Effective supervision of RBI over banks and financial institutions is largely responsible for trust and confidence of public in banking sector. 7. Competition Among Banks :- The monetary policy of RBI has resulted in healthy competition among banks in the country. The competition is due to deregulation of interest rates and other measures taken by RBI. Now-a-days due to professionalism banks provide better service to customers. II. FAILURES I LIMITATIONS OF MONETARY POLICY 1. Huge Budgetary Deficits :- RBI makes every possible attempt to control inflation and to balance money supply in the market. However Central Governments huge budgetary deficits have made monetary policy ineffective. Huge budgetary deficits have resulted in excessive monetary growth. 2. Coverage Of Only Commercial Banks :- Instruments of monetary policy cover only commercial banks so inflationary pressures caused by banking finance can be controlled by RBI, but in India, inflation also results from deficit financing and scarcity of goods on which RBI may not have any control. 3. Problem Of Management Of Banks And Financial Institutions :- The monetary policy can succeed to control inflation and to bring overall development only when the management of banks and Financial institutions are efficient and dedicated. Many officials of banks and financial institutions are corrupt and inefficient which leads to financial scams in this way overall economy is affected. 4. Unorganised Money Market :- Presence of unorganised sector of money market is one of the main obstacle in effective working of the monetary policy. As RBI has no power over the unorganised sector of money market, its monetary policy becomes less effective. 5. Less Accountability:- At present time, the goals of monetary policy in India, are not set out in specific terms and there is insufficient freedom in the use of instruments. In such a setting, accountability tends to be weak as there is lack of clarity in the responsibility of governments and RBI. There is a growing presence of black money in the economy. Black money falls beyond the purview of banking control of RBI. It means large proposition of total money Supply in a country remains outside the purview of RBIs monetary management. 7. Increase Volatility :- The integration of domestic and foreign exchange markets could lead to increased volatility in the domestic market as the impact of exogenous factors could be transmitted to domestic market. The widening of foreign exchange market and development of rupee - foreign exchange swap would reduce risks and volatility. 8. Lack Of Transparency :- According to S. S. Tarapore, the monetary policy formulation, in its present form in India, cannot be continued indefinitely. For a more effective policy, it would be necessary to have greater transparency in the policy formulation and transmission process and the RBI would need to be clearly demarcated. Thus, from above we can say that despite several problems RBI has made a good effort for effective implementation of the monetary policy in India. Place your order today Get expert help from our experienced team of qualified UK academics
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