The bank officers’ union has suggested that bilateral agreements between bank management and the union should be kept in mind while considering the Khandelwal Committee’s recommendations
The recommendations of the Khandelwal Committee on Human Resource Management (HRM) in the public sector banks (PSBs) have seen a stiff opposition from the bank officers’ union. Expressing their reservations on recommendations pertaining to recruitment and promotion policy, the union has requested a dialogue with the finance ministry.
The committee headed by the former chairman of Bank of Baroda, Dr Anil K Khandelwal, had submitted 105 recommendations on HRM in July 2010. Recently the government accepted 56 of them.
The committee recommended that 50% of the vacancies in officers’ cadre should be filled through direct recruitment. However, All India Bank Officers’ Confederation (AIBOC) feels that such recommendation is against the career interest of clerical employees and cuts the bilateral agreement between the bank management and the union. Currently 25% of the recruitment is through this bilateral agreement.
According to AIBOC, the most controversial recommendation is the performance-based incentive. The committee suggested that there should be accountability for non-performance through premature retirement of an employee after a review, on reaching 55 years of age. The union points out that the topic of performance or non-performance is debatable, for instance a bank manager can claim achievement only if the staff supports him. Accepting such suggestion of rewarding the individual without taking in to account the team work will be counter productive.
In a memorandum sent to the Department of Financial Services, GD Nadaf, general secretary of AIBOC said, “The existing bilateral understandings and agreements between bank managements and officers’ organisations in the area of promotions, transfers and service conditions may be allowed to continue.”
The committee suggested fast-track promotion by reducing the minimum length of service. This, AIBOC says has lot of practical issues as each bank has its own requirement and there cannot be a standardized policy. Currently, the promotion policy is based on bilateral agreements and takes care of career aspirations. It is also in lieu with the recently amended guidelines issued by the ministry of finance.
According the union, the recommendation to review all internal settlements affecting mobility, flexible utilization of staff productivity, performance and customer service will affect the banks’ industrial relations. “Any effort to unilaterally change the existing settlements which are time-tested and evolved through mutual consultations will vitiate the industrial relations in the banks,” says AIBOC, in its monthly journal Officers’ Voice, run by the Corporation Bank Officers’ Organisation.
It adds, “The finance ministry which represents the ownership of PSBs, has every right to issue policy guidelines; but the implementation of the policy should be left to the banks’ boards.”
Speaking to Moneylife, TR Bhat, former member of AIBOC and advisor of Officers’ Voice says that, “So far as the promotion and recruitment policy is concerned, there is a bilateral agreement between the bank management and the union. It is also within the regulatory mandate. I don’t see why there is a need for a separate guideline. Each bank has its own requirements and the ground realities are different. What suits ‘X’ bank may not interest ‘Y’ bank.”
According to the World Bank, the world economy has entered a “dangerous period” and some of the financial turmoil in Europe has spread to developing and other high income countries, which until earlier had been unaffected
Washington: The World Bank today sharply lowered its global economic growth forecast for 2012 to 2.5%, citing European financial turmoil and weak growth prospects in emerging nations, including India, reports PTI.
The multilateral agency had earlier projected that the world economy would expand by 3.6% this year.
In its biennial report, ‘Global Economic Prospects’, the multilateral agency slashed the growth forecast for high income and developing countries this year and in 2013.
“The global economy is now expected to expand 2.5% and 3.1% in 2012 and 2013 (3.4% and 4% when calculated using purchasing power parity weights), versus the 3.6% projected in June (2011) for both years,” the report said.
According to the World Bank, the world economy has entered a “dangerous period” and some of the financial turmoil in Europe has spread to developing and other high income countries, which until earlier had been unaffected.
It said this contagion has pushed up borrowing costs in many parts of the world, and pushed down stock markets, while capital flows to developing countries have fallen sharply.
“Europe appears to have entered a recession. At the same time, growth in several major developing countries (Brazil, India and, to a lesser extent, Russia, South Africa and Turkey) is significantly slower than it was earlier in the recovery, mainly reflecting policy tightening initiated in late 2010 and early 2011 in order to combat rising inflationary pressures,” the report said.
“As a result, and despite a strengthening of activity in the United States and Japan, global growth and world trade have slowed sharply,” the World Bank said.
The multilateral agency also revised its projections for growth in high income and developing countries downward for 2012 and 2013.
“High income country growth is now expected to come in at 1.4% in 2012 (-0.3% for euro area countries, and 2.1% for the remainder) and 2% in 2013, versus a June forecast of 2.7% and 2.6% for 2012 and 2013, respectively,” it said.
The report further added: “Developing country growth has been revised down to 5.4% and 6% versus 6.2% and 6.3% in June.”
Global trade is projected to grow by only 4.7% this year, compared to 6.6% in 2011. However, trade is likely to bounce back in 2013 with an annual growth of 6.8%.
The fall in trade is on account of a reduction in trade financing by banks.
The report said in the event of a major crisis, the global downturn might last longer than the 2008-09 slowdown as high income countries do not have the fiscal or monetary resources to bail out the banking system or stimulate demand to the same extent as four years back.
“Although developing countries have some manoeuvrability on the monetary side, they could be forced to pro-cyclically cut spending—especially if financing for fiscal deficits dries up,” the World Bank said.
It also said that developing countries are more vulnerable now than they were in 2008.
According to the report, even though fiscal conditions in developing countries are better than in high income countries, government balances have deteriorated by 2% or more of the GDP in almost 44% of developing countries.
“... and some 27 developing countries have government deficits of 5% or more of GDP in 2012. As a result, developing countries have much less fiscal space available to respond to a new crisis,” it said.
The government fears Turkey may come under pressure to halt the conduit after the US imposed a fresh round of sanctions against Iran, with the European Union slated to announce tough measures of its own in this regard at the end of the month
New Delhi: India has not faced any problems in paying for crude oil it buys from Iran, but needs to be prepared for all eventualities, reports PTI quoting oil minister S Jaipal Reddy.
“We continue to be optimistic. Iran continues to be positive. However we have to be prepared for all eventualities,” Mr Reddy told reporters here.
An official said Turkey’s Turkiye Halk Bankasi AS, the bank through which India routes payments in euros to Iran for about 370,000 barrels per day (bpd) of crude oil supplies, has so far not declined to be an intermediary.
“All that they (Turkey) have said is that they would not like to open new accounts but will continue to service existing accounts (through which payments are routed to Iran),” the official said, adding that not a single payment has defaulted since India began using the Turkey conduct in July last year.
US president Barack Obama on 31st December signed into law measures that deny access to the US financial system to any foreign bank that conducts business with the central bank of Iran.
The European Union will discuss imposing harsher sanctions on Iran, including a ban on crude imports, in response to the country’s nuclear programme when the bloc’s foreign ministers meet at the end of January.
The official said India will continue to buy crude oil from Iran, but would like to replace a part of the supplies with other sources like Saudi Arabia.
Mangalore Refinery and Petrochemicals, the largest buyer of Iranian oil, at 142,000 bpd, and other refiners are yet to renew their term import contracts with Iran for the year beginning April.
Essar Oil is looking at replacing 10% of the 110,000 bpd of oil it buys from Iran with other Gulf sources.
Yesterday, foreign secretary Ranjan Mathai had stated that New Delhi would not seek a waiver from US sanctions to protect its oil trade with Iran.
The US allows waivers for firms in countries that significantly reduce dealings with Iran or when it is either in the US national interest or necessary for energy market stability. Japan, South Korea and Turkey have all said they could seek waivers.
An Indian delegation comprising officials from the Reserve Bank of India (RBI), oil ministry, finance ministry and refiners is currently in Tehran to discuss alternative modes and routes of payments.
Indian refiners began using Halkbank to pay Iran in July last year after the RBI scrapped a long-standing mechanism of payment through central banks.
New Delhi fears Turkey may come under pressure to halt the conduit after the US imposed a fresh round of sanctions against Iran, with the European Union slated to announce tough measures of its own in this regard at the end of the month.
Refiners have already begun talks with alternative suppliers to slowly replace some quantity of the 370,000 barrels a day of oil they buy from Iran.
MRPL, the biggest buyer of Iranian oil at 142,000 bpd, has not yet contracted any supplies for the year beginning April.
India is Iran’s second-largest crude buyer, taking about 13.5% of Iran's 2.6 million bpd of exports. New Delhi currently pays the world’s fourth-largest oil producer about $1 billion every month through Turkey.
Sources said the possibility of paying Iran in rupees or through the yen would be discussed at the meeting in Tehran.
Routing payments through Russia was discussed during the visit of prime minister Manmohan Singh to Moscow last month.
However, Russia has so far not agreed to route payments for India due to the ‘complexities’ involved.