Assignment of Economic analysis for Business Decisions

Submitted By- Submitted To

Name- Ayushi Shah Dhirendra kumar sir
Roll No.- 55
Division -A
Summary

RBI Policy: Right move to hold rates, stance:

The mpc voted unanimously to keep rates steady and retain the accomodative
monetary policy stance, Shaktikant Das said that it would do so while keeping a
leash on inflation. The continuation of various measures, such as liquidity for
small finance banks, geotagging of payment infrastructure and raising the IMPS
transfer limit to ₹5 lakh, is also welcome. The introduction of one more theme
to the regulatory sandbox for fintech, that of preventing financial fraud, is
forward-looking. Regulatory measures that can improve credit flow in the
economy would include measures to replace informal sources in trade finance.
Small firms offer extended credit to their large buyers. Regulation and mandates
should make banks insert themselves in this credit, sparing small firms a role as
lenders.

Tatas-Air India deal: Crippled Airline, and privatization to fly:

Earlier in the 90s it was JRD Tata who founded air India as tata airlines it was
renamed as air India when it became a public limited company. but now after 60
years, Tata sons has emerged as the winning bidder for air India. As far as
disinvestment proceeds go, what the government gets from the sale of the
airline is ₹2,700 crore in cash and freedom from further accumulation of loss
and debt. To enable the sale, the government has had to park ₹46,262 crore of
debt in a State-owned holding company, along with prize real estate assets of
the airline. The government did well take out as much of the debt from the
company as was needed to find a buyer. Some would say the Tatas were the
only serious bidder. The Tatas will have to decide how many airline brands they
want to manage, and how best to utilise the extra manpower they get with Air
India.
Monetary policy is the control of the quantity of money available in
an economy and the channels by which new money is supplied. By managing
the money supply, a central bank aims to influence macroeconomic factors
including inflation, the rate of consumption, economic growth, and overall
liquidity. Monetary policy can be broadly classified as either expansionary or
contractionary. Some of the available tools include revising interest rates up or
down, directly lending cash to banks, and changing bank reserve requirements.
Monetary policy is a modification of the supply of money, i.e. "printing" more
money, or decreasing the money supply by changing interest rates or
removing excess reserves.

Privatization occurs when a government-owned business, operation, or

property becomes owned by a private, non-government party. Note that
privatization also describes the transition of a company from being publicly
traded to becoming privately held. This is referred to as corporate privatization.
Privatization describes the process by which a piece of property or business
goes from being owned by the government to being privately owned. It
generally helps governments save money and increase efficiency, where private
companies can move goods quicker and more efficiently. Critics of privatization
suggest that basic services, such as education, shouldn’t be subject to market
forces.