Tuesday, April 4, 2017
If Nothing is happening good, keep patience something will happen better": Chandra kant jha (PNB clerk 2017)- 18
"If Nothing is happening good, keep patience something will happen better": Chandra kant jha (PNB clerk 2017)- 18
EDITORIAL OF THE DAY FROM BUISINESS STANDARD
There is a lot of buzz around ‘Digital India’ these days. Are we, in your view, ready to move towards a digital economy?
India has no choice but to be ready to be a digital economy. Digital India has to be the way for the future. There are three aspects to understanding what a digital economy means. The first one is readiness: How prepared we are for the digital economy. This includes issues of infrastructure – does the infrastructure actually exist, and do people have the correct skills to use computers and the internet?
Then second aspect is ‘usage’, which revolves around how people use digital technologies and to what extent. Some of the questions involved here are whether computers are available for children in schools? Do small businesses have access to digital technology? And to what extent do large businesses use such technologies?
The third, and the most important, aspect is ‘impact’. We need to look at the actual outcome of the access to and usage of such technologies. For example, if you have technology (computers) in schools, does it actually mean children have better learning outcomes? Or, are children better prepared when they actually graduate? Does it translate into greater business competitiveness?
If you think of Digital India in terms of readiness, usage and impact, you start understanding that you have to work on all these dimensions for key stakeholders — private citizens, businesses and the government. All these three stakeholders should be working on all the three dimensions — readiness, usage and impact.
What is the current technology landscape in the country and is it enough to move towards a digital economy?
On the technology side, despite making progress, clearly we are not at the leading edge. We have to make progress in most areas. By progress, I don’t only mean hardware or software but also the people. People do not have the education and basic skills to use digital technology. Therefore, it is very important to be able to invest in hardware, software and people.
There is a lot of progress that has been made. We are in a much better position than we were 10 years ago. However, what is the benchmark? Is it where India was 10 years ago or is it where China and other leading countries like Finland or Estonia are today?
If we look at the leading benchmark, we are still lagging. However, we appear to be making a swift progress.
Is there a blueprint which the government could use to catch up in the areas that need attention and improvement? How can we compete with the leading countries?
There is a report which I produced in collaboration with the World Economic Forum, ‘The Global Information Technology Report’. In this report, we have a whole model called the ‘networked readiness index’ that actually provides a framework for formulating the technology policy for a country.
The technology policy of a country cannot be limited to the sale of spectrum or issues related to bandwidth. Instead, it must look at the political and social environment, skills possessed by the common people, and the whole issue of impact.
In fact, I have created similar frameworks for some governments using research based on the networked readiness index. I think that would be a good framework for India to follow.
Is the Indian government using any such framework to fast-track digitisation?
Of course, India was one of the first countries to have a ministry of information technology. A lot of good progress has been made. However, technology alone is not the outcome. Instead, the outcome should be the impact.
There is a dark side to technology as well — security. How ready are we to address such issues?
Security and privacy are very difficult issues. There are no good solutions to them anywhere in the world. This is because of the way technology is developing. You have to have this balance between security, trust, privacy and access.
Certainly, in an environment where national security has been the top priority, many governments have found good reasons to actually control and increase that dominance on security elements.
If you look at the literature before this focus on national security began, the general view centred around increasing the set of tools the people would have at their disposal. The general theory was that people would have more control over their own privacy.
In reality, in the past 10 years, the theory has been turned on its head. People are losing control of their privacy and the kind of tools people thought they would have for their privacy are actually broken into routinely, often by governments. There are many cases where governments around the world routinely ask account providers and application providers to release data for national security purposes.
Therefore, the view that we initially had of the internet – that people would be able to access all information freely and that they would have more control over their privacy, is in fact moving in the other direction. In truth, people are losing access and they do not have complete freedom and access to information.
If we take Aadhaar for an example with regard to security and privacy, do you think it is a step forward? Also, do you think Aadhaar is safe?
Aadhaar is definitely a move forward; there is no question about that. You need it to help provide efficient government services. Leaving aside any privacy and security concerns for a moment, India is a country that needs to have efficient government services. Without Aadhaar, it would be very difficult to put in place many basic services. It would also make it more difficult to digitise government services, and allow the providers to interact with citizens. Otherwise, there are all kinds of frauds and corruption in the system.
Aadhaar is a necessity and a positive thing. That is one reason why the Narendra Modi government has retained it. However, safety is an important issue; cyber threats are widespread. In principle, everything can be hacked. There is a huge issue of safety of records of financial transactions, medical transactions and other personal data that are on the web. I hope the government is taking the best precautions possible to try and safeguard security.
There is always a risk in technology. The benefits of Aadhaar far outweigh the risks in my view.
The core technology used in Aadhaar is to identify individuals based on their biometrics and retina scans. These are identities unique to every individual. While debit or credit cards can be replaced and passwords reset, how will you weigh the risk of putting unique identity of the citizens – biometrics and retina – out there for people to gain access to?
The biometric safeguards are becoming increasingly common. Increasingly, biometric information is being used in higher security applications. So, there is indeed a risk and there is no question about that. But the question here is what sort of a balance is there between risk and benefits.
QUIZ ON APPROXIMATION FOR SBI PO 2017
Q1. What is the difference between the largest and the smallest fraction 5/8,21/35,9/16 and 6/7 ?
(a) 33/112
(b) 11/37
(c) 13/41
(d) 9/35
(e) None of these
Q2. When one-fourth of a number is subtracted from one-third of the same number, the remainder obtained is 12. The number is:
(a) 144
(b) 72
(c) 120
(d) 63
(e) None of these
Q3. (1.06+0.04)^2- ?=4×1.06×0.04:
(a) 1.0404
(b) 1.404
(c) 1.5
(d) Cannot be determined
(e) None of these
Q4. Which of the following fractions is less than 7/8 and greater than 1/3?
(a) 1/4
(b) 23/24
(c) 11/12
(d) 17/24
(e) 13/14
Directions (6-10): What should come in place of question mark (?) in the following given questions? (Note: You need not to calculate the exact value.)
Q6. (8.036÷1.986×2.99) = 5.896×?
(a) 2
(b) 3
(c) 4
(d) 5
(e) 6
Q9. (124.76% of 839) ÷ 15.02 = ?
(a) 80
(b) 70
(c) 90
(d) 60
(e) 40
Q10. 84.85 × 12.02 + √48.88 × 16.06 = 283 × √?
(a) 4
(b) 5
(c) 9
(d) 10
(e) 16
Directions (11-15): What approximate value will come in the place of the question mark (?) in the following questions? (You are not expected to calculate the exact value.)
Q11. 7441 ÷ 34 × 12 = ? × 9 + 110
(a) 420
(b) 280
(c) 590
(d) 350
(e) 220
Ans
RBI TO INTRODUCE RS. 200 NOTES
RBI to introduce Rs. 200 notes
The move to introduce lower denomination notes comes against the backdrop of the government’s move to rework the currency mix. On 8 November, it announced the withdrawal of Rs500 and Rs1,000 currency notes, amounting to around 86% of currency in circulation of Rs17.9 trillion.Since then, RBI has replaced these with the new Rs2,000 and redesigned Rs500 bank notes. As on 24 March, currency in circulation was Rs13.12 trillion, still around 27% off pre-demonetization levels. The government is encouraging digital payments and may not increase currency in circulation to the pre-demonetization level.
Note : Last month RBI also started field trials of plastic notes of Rs 10 as plastic notes are expected to last longer than cotton substrate based banknotes.
SUCCESS STORY OF MR. ASHISH TAYDE CANARA BANK PO ("Kabhi Khushi Kabhi Gum!!!".)
Banking exam preparation is like "Kabhi Khushi Kabhi Gum!!!".
ASHISH TAYADE (Canara Bank PO)
MY NAME IS ASHISH TAYADE aka Hell_Mate in Disqus. I m a silent reader of Bankersadda.
MY RESULTS
SBI Junior Associate Pre CLEARED
SBI Junior Associate Mains FAILED
SBI PO Pre FAILED
Bank of Baroda PGDBF CLEARED (FAILED in Interview)
RBI Assistant Pre FAILED
CWC Jr. Superintend FAILED
IBPS PO Pre CLEARED (scored 47)
IBPS PO Mains CLEARED (scored 67.75)
AND THE BEST ONE ....
IBPS PO 2015-16 SELECTED AND GOT CANARA BANK.
Everyone has a different strategy for competitive exam preparation and here I am sharing my strategy. I kept it simple. I had started my PO preparation in January 2016 and my main target was SBI PO in which I failed miserably. I couldn't able to clear SBI PO Pre in which i had scored 31 only. It was the must needed jolt for me that gave me the reality check.
It was time to rebuilt my strategy. The main flaw in my preparation was inconsistency. I again started from the beginning but this time quiet hatke strategy as I am a big fan of cricket and MSD, I molded my PO preparation in somewhat cricketing way. The way cricketers do a net practice everyday I used to practice Quantitative Apptitude and Puzzles everyday and for English and GA, I used to read The Hindu everyday. The way batters knock their bat before match I used to revised the important formulas and concepts one day before the exam. And this strategy worked for me and I cleared BoB PGDBF though I was not in the final selected candidates but it gave me an immense confidence. But then as in cricket every venue has a different conditions and you have to adapt according to that similar in case of PO exams where each exam these days giving aspirants new surprises. One may fail or clear the exam but then what is most important to survive in this world of cut-throat competition is the daily "NET PRACTICE" I mean practice everyday as per the convenient schedule. Don't ever give up and "NEVER EVER STOP BELIEVING IN YOURSELF". And maintain a good friends circle those who can support you in tough time.
During preparation i had never missed a single match played by "Team India", why I am telling this because during preparation don't sacrifice the things that makes you happy it ultimately helps your mind to stay alert and fresh.
And now that I got selected as a PO, from past few days I am receiving calls from the relatives and friends and they say "HELLO SAHEB !!!!"...it's priceless.
Note: If you want to score good marks in General Awareness, special capsules by BankersAdda are must must must.
ENHANCED LIST OF RBI ASSITANT UPDATED
Click here to check enhance list
Monday, April 3, 2017
EDITORIAL OF THE DAY FOR SBI PO 2017
The inflation bias is well known in macroeconomics as the temptation for policymakers to create excess inflation to stimulate output. Inflation targeting is designed to counter the temptation. But it can create the opposite bias.
If bureaucrats are given an inflation target which measures their performance, they would tend to impose too high an output sacrifice in order to achieve their target. Flexible inflation targeting builds in some counters to this bureaucratic bias. For example, it gives a weight to growth, allows some time to achieve the target, and brings in outside experts with independent views in a monetary policy committee.
But there is evidence that these checks have proved inadequate in India, and therefore need to be strengthened.
Wrong inflation expectations
Repeated research at the Reserve Bank of India itself, has shown the importance of food prices for Indian inflation and for household inflation expectations. It has also shown excess capacity in industry. Yet as in classic strict inflation targeting, authorities seek to reduce inflation by further widening a negative output gap. In order to suppress demand, the real interest rate has to be kept high, with the nominal interest rate exceeding expected inflation. A higher future expected inflation rate then allows policy rates to be high even though current inflation falls. But inflation targeting is also about guiding expectations of inflation. If the announced rate of inflation is kept higher, it prevents inflation expectations from falling as much as they could have otherwise.
The bimonthly monetary policy statements from 2014-16 show the one year-ahead inflation announced was almost always about 1 cent above realised inflation. The expected inflation path depicted was always U-shaped or flat, with inflation rising eventually, even if it fell in the short term.
Since from 2014, on IMF advice, a positive natural rate of 1.25-1.75 per cent was built in, it meant real interest rates were actually higher in the contractionary range of 2.25-2.75, discouraging investment that could have reduced supply-side bottlenecks. The IMF ignored first-hand experience of the ill effects of high interest rates on indebted firms during the East Asian currency and financial crisis.
Thus an incorrect emphasis on the weak output gap channel reduces the effectiveness of the expectation channel. This is unfortunate since in Indian conditions the latter is almost the only one that works. A valuable signal that could anchor inflation expectations was not optimally used.
Bias shows in other ways also — for example, the decision to target headline CPI inflation, which was the highest when inflation targeting began, but the shift in policy statements to core inflation when the latter was higher.
There are asymmetric responses such as not reducing rates for a negative output gap but getting ready to raise them when it is thought to be closing. Also an oil price fall is regarded as temporary and a rise as more likely to be persistent. Therefore interest rates are not cut with a fall in oil prices, but there is instant readiness to raise with a rise.
One reason for the bias is a strong pro-market monetarist perspective, itself dictated by pressures from foreign capital. In this view structural reforms create growth, while money supply affects only inflation. If structural rather than macroeconomic policies are seen as affecting capacity, it is inconsistent to believe capacity is likely to be destroyed by lack of use following weak demand. Yet this is articulated as a reason to expect inflationary pressure.
Exaggerated fears
While it is too early to compare the forecasts the MPC makes vis-a-vis realised inflation, there is the same communication that future inflation is expected to rise. Some of the arguments given to support this are weak. For example, firstly, that core inflation is sticky. But it fell sharply in 2014 from 8 per cent to 4 per cent along with a fall in household inflation expectations. It follows that these, built into wages, affect core inflation, not excess demand for services due to shortages of skills. The perception of absence of change is itself a bias.
Secondly, there is the argument that agricultural wages are rising. But the current low rate of increase can be absorbed by productivity increases. It is only the double-digit type rise of 2011, following double-digit food inflation, that causes inflation. Thirdly, there is a fear of oil price rise, outflows and rupee depreciation.
But oil prices are softening again. US shale production can kick in quickly and cap price rise, while some rise in oil prices is good for our exports. Fourthly, inflows and the rupee have strengthened despite a rise in US fed rates. Indian political stability and growth prospects continue to be the primary drivers of inflows, not the interest rate differential. While the Technical Advisory Committee had a healthy diversity of views, the MPC has too much consensus pointing towards bureaucratic dominance.
Cost of bias
High interest rates following inflation targeting reduced demand. Industrial growth, employment, capacity utilisation and investment have been low since 2011. Bank credit to industry and private investment growth actually became negative in 2017. Corporate debt grew at double digits from 2012 raising the share of chronically stressed firms while gross NPAs of PSBs doubled. Five years is too long to suffer to build an elusive future.
Even so, the focus on structural reform and on the long run did successfully reduce vulnerabilities, such as twin deficits. Macroeconomic policy should now be in a position of strength. But unfortunately it continues to overestimate foreign shocks and underestimate its own strengths and capability to smooth shocks, resulting in external dominance and suppression of domestic demand. This although the experience of the 2013 US taper showed raising interest rates to keep foreign capital does not work in India. Even at a vulnerable time, other more effective weapons were found against outflows.
An additional check could be for the RBI governor to report periodically to a parliamentary committee, as in the US, answering informed questions on the inflation target path and its costs.
The writer is a professor of economics at IGIDR, Mumbai
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