Regulations
RBI Deputy Governor appointment runs into trouble

A letter of objection to senior-most executives in the finance ministry and the apex bank, documenting alleged performance failures and ignoring of governmental appointment norms, may queer the pitch for the selection of the central bank’s new DG 

While RBI (Reserve Bank of India) Deputy Governor, Usha Thorat, has stepped down on Tuesday, 9th November, the appointment of Mr Anand Sinha as the new Deputy Governor has run into rough weather. We learn that the appointment has not been announced following a letter from Mr Deepak Mehra, who claims to be from the Forum for Financial Fairness in Mumbai. Writing to the Finance Minister, Mr Mehra has made some serious charges against Mr Sinha, which are confirmed by our sources in the RBI. However, the RBI has not responded to our query for its comments.

Mr Mehra alleges that Mr Sinha spent his entire career of three-and-a-half decades at Mumbai, barring short stints at Bhubaneshwar and Guwahati which were controversial.

Specifically, he says, that Mr Sinha was charge-sheeted for certain performance failures during his Guwahati stint, leading to a department inquiry and punishment in the form of reversal of two increments. This is considered a serious punishment at the RBI. Our sources say that the punishment was later reduced to the reversal of just one increment, but that he was indeed found guilty of dereliction at least, in his stint in the estates department.  As officer in charge at Bhubaneshwar, he was issued a "letter of displeasure" and shunted out halfway during his tenure. Mr Mehra alleges that this was due to "incompetence and failure to rise to the occasion".

According to Mr Mehra, Mr Sinha was then sidelined by shunting him to the Deposit Insurance and Credit Guarantee Corporation (DICGC), where his tenure was again lacklustre. However, a more serious charge is that in selecting Mr Sinha, the RBI ignored "the government's own well-laid criteria of minimum residual service of one year." Mr Sinha apparently retires in February. 

Given the fact that Mr Mehra's letter has been sent to the Finance Minister, Finance Secretary, RBI Governor, Cabinet Secretary and Ms Omita Paul, Advisor to the FM, it is clear that an inquiry is on, since Mr Sinha's appointment has not been announced by the government. With a tenure of only until February, it seems certain that RBI may have to hunt for a new Deputy Governor, since the government is unlikely to court yet another controversy at a time when it has just been forced to sack Maharashtra Chief Minister Ashok Chavan and Mr Suresh Kalmadi, a key figure behind the loot of funds at the Commonwealth Games.
 
Meanwhile, Deputy Governor KC Chakrabarty remains in the doghouse, because all of Ms Thorat's portfolios have been 'temporarily' handed over to Deputy Governor Ms Shyamala Gopinath.
 

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COMMENTS

Nagesh KiniFCA

6 years ago

mr samskar or whoever you are please have the courage to unmask your identity. do you want to be an 'whitsel blower anonymous and yet remain in the lime light and want to eat the cake and have it too?

samskar

6 years ago

There is something called samskar in Hindu religion. All that have been written in this blog about Mr Sinha of RBI says all bad things about him. But it does not say why despite so called incompetence Mr Sinha was brought back to the mainstream from DICGC. Does Ms Dalal not know Mr Sinha is one of the most knowledgeable officers of RBI when it comes to banking regulation and supervision? Why has she underplayed it or totally omitted to mention it?

For the other readers , it is worthwhile to know , it is not a case of whistle blowing. It is malicious and silly and mean allegations by people who do not know what they are doing and who do it with malice.
And by quoting those people and by not mentioning the overwhelming fact that Mr Sinha is one of the most non-controversial, well behaved, polished, knowledgeable officers of RBI, Ms Dalal is doing great disservice to the cause of public policy and unbiased journalism.

REPLY

Ravindra Shetye

In Reply to samskar 6 years ago

"non-controversial, well behaved, polished, knowledgeable" are good 'qualities'. What is required for the higher positions is the 'capability' and 'application of the capabilities' which results (normally) in above par 'performance'. Just having the qualities mentioned by Samskar may make a 'good person', not necessarily a good 'performer'.

samskar

In Reply to Ravindra Shetye 6 years ago

it is both for Ravindra and rakesh and all other readers too.

The key issue is Mr Sinha is not just knowledgeable. He is competent too. Yes he is competent. The fact that Ms Sucheta Dalal knows some instances where there were issues suggesting his incompetence does not make him incompetent. There are two reasons for this:
One, who told Ms Dalal about it? Should she not try to know whether similar such things could be there in the record of other people in RBI. I have no idea, I have no insiders information. I dont work for RBI. But I know one thing. RBI is a competent and transparent organisation. Nobody can go unpunished, howsoever mighty he may be. This I know due to my close association with RBI through close friends. That is why these things could be on record as far as Mr Sinha is concerned.
But one has to look at the extent and severity of the issues. Is he dishonest? The clear answer is no. Mind you, in this country today and at this juncture, one of the criteria to judge one's competence is one's honesty. You know , why? Because it is in such short supply. Look at what is happening around.

Well, the same type of things could be there for others too. Has Ms Dalal enquired with her sources? Let her please. You said had a person like Mr Sinha been there in private sector , he would have been sacked long back. What could be farther form truth? You just dont know how incompetent Indian private sector is and how corrupt and incompetent their officials are including the very senior people. Lets not think of private sector in India through a Tata lense or an Infosys lense. Indian private sector is as incompetent and dishonest as Indian people in general could be or Indian society could be. In fact that is not the issue.

The point actually is, competence is a relative and contextual thing. You can dub anybody as incompetent on many grounds and any ground. I am not arguing. Just believe me. I see a thing or two in the reporting , that calls into question its credibility . Why his competence in matters have not been reported? That is the key question!! Well, he is not all the way incompetent. He has lot many competencies. What about others? WHO gave her these sets of information, how credible they are and how relevant they are in the context.? The bigger question is has she checked why these instances were ignored by the people who selected Mr Sinha. Has she checked who were the people who selected them? How competent they are to assess the competence of the persons they were assessing for th epost of RBI Deputy Governors position? Are they selectors incompetent? What is the central issue in this reporting?

Competence is a spectrum across time and space. In a carreer spanning across 30 0r 40 years , well whatever the length is, any one would have faltered, slipped and made mistakes. They dont make the person incompetent, especially when you know of it because the system in which the person was working has a solid culture of transparency. They dont make the person incompetent , when in many other organisations serious events involving bribery, criminal conspiracy, losses, blah blah are deep rooted and nobody get caught, not to speak of instances of negligence and incompetence. RBI is not like that, it is not like defending any body, but trying to point out that the reporting is not unbiased and borders on sensationalism fed by insiders.

And lastly, it all depands on what we mean by competence. It is not definitely pushing files successfully , without taking real decisions , marking papers up and down. Such people can easily pass off as competent people, as they do not take risk of taking a decision or they decently and carefully avoid taking the decision. And they would never be found making mistakes. That does not make the persons competent, but unfortunately many including Ms Dalal would be happy believing that they are competent, without mistakes, without abilities to take well considered decisions involving large system like the financial and banking system of India. to my mind we are not looking at adequate facts, not looking at the things on balance. It has been made aou to be an absolute thing about a man unmindful of his achievements, abilities and professional track record on the basis of two events which the organisation itself has not viewed seriously not once , but many times in the past while taking critical decisions on his promotions and placements.



sucheta Dalal

In Reply to samskar 6 years ago

Mr Samskar

Suggest that you don't come to this website only when you have to defend someone. Frankly, it is counter-productive even for the person you are trying to defend.
You are clearly an RBI insider or at least close to Mr Sinha. In that case you know exactly how it functions. How it shuts out people. How RBI does not believe in facts, meritocracy or even experience, while dealing with insider and outsiders.
And you cannot have missed its tactics to control and influence the media.
As for whether or not we write about others, read the reports on the top right hand side of our home page. Also watch this space, there is a lot more coming.
sucheta

Rakesh

In Reply to samskar 6 years ago

Blah, blah, blah
Not one iota of fact or evidence.

RBI is opaque, unaccountable and a fief of some very mediocre people.

Kuods to Ms Dalal for training her guns on this organisation. Look forward to many such pieces.

rakesh

In Reply to samskar 6 years ago

Samskar believes that what drives India is meritocracy! How stupidly naive.
Cant he see around that so many incompetent officials and politicians rising to the top! Why is it such a surprise ?
A journalist's job is not to distribute character certificates. Mr Sinha's godfather and godmothers are doing a very good job of it.
If Mr Sinha was in the private sector this "non-controversial, well behaved, polished, knowledgeable" officer would have been sacked long ago. Anything goes on inside the unaccountable RBI.
In fact, we would like to see many more exposes of this kind, especially since the mainstream media is simply doing paid news.
Smaskar should be reading the mainline dailies and news channels and feel happy. We read Ms Dalal for honest and bold writing. We dont want that diluted.

nagesh kini

6 years ago

addition to
Mera bharat mahan

Magar hum sub bahoot pareshan
Kyu ki 99% to hai maha beimaan!

p y k

6 years ago

this really frightening. i had very clean and efficient image of axis bank, show case of public sector turned into pvt sector etc....it is GOLMAL , as bad as cwg / 2 g license cases. mera bharat mahan!!

nagesh kini fca

6 years ago

thank you sucheta for putting mr. mehra's letter in public domain. the facts are very damaging, such persons certainly not be 'kicked up', anywhere, least off at rbi.
the three ladies - no gender bias - dgs - i have the privilege of initially meeting them professionally in their earlier avatars as Exchange Controls -Bengaluru, Chennai and Ahmedabad respectively and personally there after.
They were among the few who were a pleasure to deal with in those heady days of FERA. They deserve to be succeeded by some one equally good and not anyone with a shady non performance past!

SANJAY PRABHU

6 years ago

Indian Financial System is here to collapse at any time, as every Senior Banker wants to make money through various frauds. Senior functionaries from Axis Bank is also involved in various frauds and if the RBI appoints such corrupt officials to the post of Dy Governor, then i am sure that public money is not safe under the supervision of RBI


Majority of the Axis Bank branch employees are already under tremendous pressure of handling customer complaints & frauds popping up daily at one or other branches, collapse of the operational systems due to staff resignation and failure of HR polices, tremendous business pressure of mis-selling Max New York Life Insurance and on the other side involvement of central and zonal offices in various frauds with the Govt Accounts, Defense Accounts frauds, Defense Employee unclaimed salary A/c frauds, Defense Employee unclaimed pension A/c frauds, Retail Assets frauds, Excise & Income Tax Frauds, Capital Market frauds, IPO Reimbursement Frauds, ATM Cash Shortage Frauds of more than 60 crores, Debt Relief Fund Frauds, Unclaimed DD/PO frauds, ATM / Interior Decoration and Branch premises lease rental frauds, Issuing Fake Term Deposit to customers and government authorities at Jabalpur Bhopal & Kashipur other branches, Agri Credit Frauds, 165 crores Priority Sector Lending frauds at Bhopal and other centers, One time Loan settlement fraud at Nashik and other agri credit centers, Debt relief waiver fraud at Rajkot and other centers etc., where in the bank has breached the trust with Government of India and the State Governments. Government and the investors in general has lost the faith and the trust of erstwhile UTI Bank which transformed SOLUTIONS FOR LIFETIME to THERE'S ALWAYS A SOLUTION for business & personal growth of senior management through high level frauds.

REPLY

venkat

In Reply to SANJAY PRABHU 6 years ago

Mr Prabhu
I hope you are working in AXIS,and the feelings shows that. Being a banker,am really worried and astonished to know all these facts. I think its going to be really tough in the near future.

SANJAY PRABHU

In Reply to venkat 6 years ago

Dear Sir,

I am the victim of whistleblower, and soon I will be sharing the true facts with Investors of Axis Bank through all the social websites like face book, twitter etc. Presently you can view my blog on CA Club.

http://www.caclubindia.com/blog/will-rbi...

http://www.caclubindia.com/blog/letter-f...

Sanjay Prabhu
Shareholder of Axis Bank

Ravindra Shetye

In Reply to SANJAY PRABHU 6 years ago

I am a customer of Axis Bank (formerly UTI Bank) for past 10 years and must say that I am fully satisfied with Axis Bank service compared to three other Indian Banks, equally large or larger than Axis Bank.

K B PATIL

In Reply to SANJAY PRABHU 6 years ago

Thank you Mr. Prabhu for enlightening us about Axis Bank. I had not the slightest idea about this and was of the opinion that Axis Bank was one of the best private sector bank. Looks like nothing is sacred now in our country.

INVESTORS FORUM

In Reply to K B PATIL 6 years ago

See their AD Bank Comes home to loot you

SANJAY PRABHU

In Reply to K B PATIL 6 years ago

Dear Sir,

I am the victim of whistleblower, and soon I will be sharing the true facts with Investors of Axis Bank through all the social websites like face book, twitter etc. Presently you can view my blog on CA Club.

http://www.caclubindia.com/blog/will-rbi...

http://www.caclubindia.com/blog/letter-f...

Sanjay Prabhu
Shareholder of Axis Bank

Pvt Bank Employees And Investors Protection Forum

In Reply to SANJAY PRABHU 6 years ago

Audit Department is headed by non professionals, where as all other banks Audit Dept., is headed by a Senior Chartered Accountant, so see the future of Axis Bank.

BEIP FORUM

In Reply to Pvt Bank Employees And Investors Protection Forum 6 years ago

Education loan racket caught in Delhi : Axis Bank opened fraudulent Accounts

Pune Job aspirant duped of Rs 10 lakh : Axis Bank opened fraudulent Accounts

Ravindra Shetye

6 years ago

It is incredible that these serious performance blots are brought to light by a whistleblower, but were completely ignored so far by those who were conducting the selection and hence must be having access to Mr. Sinha's personal file. It is pure cycophancy that Mr. Sinha could manage to contend for RBI Dy Governor's post.
Incredible India.
Kudos to Mr. Mehra. We need more such Mehras.

The future of sugar stocks hinges on when and how much export the govt allows

Indian sugar exports are expected to be the only saviours in easing overheated global prices due to shortage predictions. The future of sugar stocks depends on when the govt allows exports and how much

Just about everything seems to be going right for sugar prices. In New York, raw sugar prices reached a 29-year high. Australia has said that it could produce its smallest sugar crop in 20 years because of heavy rains. Brazil, a key sugar producer, is facing a dry spell in key parts coupled with loading problems in its ports. India on the other hand is going to produce a lot more than it initially expected and is in a position to export some of its surplus.

India is at the centre of it all for some time now. In February, when it was feared that sugar production in India would be a dismal 15 million tonnes (MT), sugar prices the world over soared. Then came the news that it was not going to be so bad (about 19MT) and sugar prices fell drastically. But not for too long. Once again sugar prices are soaring on speculation that there will be a deficit in global sugar supplies against the predictions of a 2.5MT surplus earlier.

India is in a position of power with a good monsoon under its belt. With cane production expected to be around 350MT, experts believe that India can easily produce about 25MT of sugar now. This, coupled with leftover stock from last year will make our end-of-the-year sugar position at around 32MT. Not surprisingly, sugar producers are pushing for opening up exports in a big way. In FY08 (a good production year) India exported around 5MT of sugar.

The speculation is that the Indian government will soon free up sugar exports and permit 2MT under the Open General Licence. Millers believe India will export at least 3MT this year.However, things are not that simple. India is facing a delayed crushing season this year as there is no accord between cane producers and millers over cane prices (although this is not unusual). Crushing is expected to begin in another 10 days if all goes well. In UP, a key sugarcane-producing state, the government has fixed the minimum price of cane at Rs210 per quintal. In general, what the millers pay to cane-growers is above this price anyway.

But this time the growers seem to be demanding Rs280 per quintal, a price which sugar millers claim is not viable. Last year, due to a shortfall, mills did pay these kinds of prices to producers.So far, retail sugar prices (which had touched Rs50 per kilogram this year) have remained at low levels of Rs30. With food inflation just starting to cool down in India, there is a worry that the government may take a call about not permitting too much export to maintain prices. However, so far, the market opinion is that agriculture minister Sharad Pawar will push for aggressive exports.

Meanwhile, it looks like sugar stocks will continue to surge. Shree Renuka is trading at Rs107 levels, still some way off from its year high of Rs124 in January. EID Parry has already touched a new high of Rs567 yesterday. Triveni is at Rs129, still below its high of Rs144 in March. Both Bajaj Hindusthan and Balrampur Chini are way below their highs of Rs243 in January and Rs150 in November 2009.


(This article is based on secondary research. The report is for information only. None of the stock information, data and company information presented herein constitutes a recommendation or solicitation of any offer to buy or sell any securities. Investors must do their own research and due diligence before acting on any security. Some of the opinions expressed in this article are the author's own and may not necessarily represent those of Moneylife).

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Thursday’s Market Preview: Flat-to-positive opening likely

The domestic market is likely to see a flat-to-opening today on mixed global cues. The weekly food inflation data will also provide some direction to the market. The US markets closed higher as signs of optimism in the country’s economy spurred investors to make fresh moves. The Asian pack was mixed in early trade ahead of economic data to be announced by China and the meeting of Group of Twenty (G20) leaders, which gets underway in Seoul Korea today. The SGX Nifty was down 24.50 points at 6,285.50 against its previous close of 6,310 on Wednesday.

The market opened lower yesterday, tracking unsupportive global cues. Volatility continued with the indices moving on both sides of the neutral line on quite a few occasions. Every move into the green was followed by a dip into the negative territory. However, the broader indices stood firm trading with good gains. The see-saw continued unabated in the post-noon session with the indices touching the day’s lows towards the close of trade but the market managed to end the session just above that figure.

The Sensex ended 56.77 points (0.27%) down at 20,875, struggling hard to regain the highs seen last week. The Nifty settled at 6,275, down 25.85 points (0.41%).

Wall Street settled higher on Wednesday on positive economic data and as the dollar took a breather after four sessions of gains. Meanwhile, the Federal Reserve will conduct 18 open-market operations from 12th November through 9th December. The central bank is buying an additional $600 billion of Treasuries through June and expects to reinvest $250 billion to $300 billion of proceeds from mortgage-backed debt and agency securities into Treasuries. Besides, the number of workers filing for initial jobless claims fell by a greater-than-expected 24,000 to 435,000, the lowest level in four months.

The Dow added 10.29 points (0.09%) to close at 11,357. The S&P 500 rose 5.31 points (0.44%) to 1,218. The Nasdaq gained 15.80 points (0.62%) to close at 2,578.

Markets in Asia were mixed in early trade ahead of the announcement of economic data by the Chinese government. The two-day G20 meet, which gets underway in Seoul, will also provide cues to the regional bourses, especially in terms of currency and banking regulations.

The Hang Seng gained 0.53%, the Nikkei 225 was up 0.29% and Straits Times rose 0.23%. On the other hand, the Shanghai Composite declined 0.14%, the KLSE Composite shed 0.44%, the Seoul Composite fell by 0.03% and he Taiwan Weighted was down 0.03% in early trade. The SGX Nifty was down 24.50 points at 6,285.50 against its previous close of 6,310 on Wednesday.

Buoyed by robust tax collections so far, the government has exuded optimism that it will surpass tax collection target of Rs7.45 lakh crore this fiscal.

“Revenue target for this year is Rs7.45 lakh crore and I see no reason why we should not achieve it... As a matter of fact if things go as they are, we expect to make a modest increase over the targets,” revenue secretary Sunil Mitra told reporters on Wednesday.

He, however, refused to give any revised figures and said no new numbers have been fixed as of now. Mr Mitra said that during April-October, the government has collected over 50% of the budgeted target.

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