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Presented By:Mir Omer toVijaya Master edit Ashish Asha Jyoti Mohsin
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GLOBALISATION
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GLOBALISATION
Click to edit Master subtitle style Increasing economic openness and growing economic interdependence between countries.
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Period
1980-81 to 1991-92 1992-93 to 1999-00 2000-01 to 2010-11 Good news: Wider markets for trade
Bad news: Reduction in sovereignty Increase in competition may lead to some firms
Indias Share into edit Click World Master Imports Indias Exports as percent of GDP Indias Imports as percent of GDP Foreign Direct Investment (million US$)
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Prior to 1991, India practiced an inward-looking strategy or import substitution policy in order to be self-reliant. Unfortunately this policy, for various reasons could not serve the purpose to:
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India was more of a passive by-stander than an active participant. Reasons for India to liberalise its economy: to be better equipped to improve the performance of theGovernment; to provide opportunities to launch development plans by securing longterm foreign direct investment flows; and expand job opportunities, reduce poverty, create consumers in the market place. Thereby make the circle of economic development virtuous rather than vicious.
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Can India avail of the benefits of Globalisation with its present government system / structure?
The answer is no. India needs to bring reforms at the level of governance. With decreased government protection and increased participation in the process of globalisation, the government must provide an enabling environment and infrastructure to get benefits out of the process. For instance: Availability of to edit Master subtitle style quantity and Click electricity at lower prices, in right quality; Good infrastructure facilities such as communications, roads, transport, ports etc; Flexible labour market; Discipline and tightening of bureaucratic setup; and Effective system to guard against corrupt officials.
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End of World War I End of World War II End of Cold War 9/11
(1918) (1945)
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The second most populated country in the world India currently is the third largest economy India inherited one of the worlds poorest economies
the best formal financial markets in the developing world, with Click to edit Master subtitle style four functioning stock exchanges
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The ratio of Indias market capitalization to GDP rose from about Click to edit to over subtitle style 3.5% in the early 1980sMaster59 % in 2005, which ranks 40th among 106 countries
the financial system is dominated by an efficient (low overhead cost) but significantly under-utilized (in terms of lending to nonstate sectors) banking sector.
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The financial institutions consist of commercial and co-operative banks,RRBs,AIFIs and NBFCs.
the financial market in india comprises of money market,securities market,FEM, and capital market.
The reserve bank set up the institute for development and research Click to edit Master 1996. in banking techonology (IDRBT) insubtitle style
An autonomous centre for technology capacity building for banks and providing core IT services.
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Refor ms
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Pre-Refor ms
Channelling resources from the surplus to deficit sectors.
Banking sector suffered from lack of competition,low capital base,low productivity, and high intermediation cost.
After nationalisation of large banks in 1969 and 1980, govt owned banks dominated the banking sector.
Banks didnt follow proper risk management systems and prudential standards were weak.
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The mutual fund industry also suffered from lack of competition,and was dominated for long by UTI.
NBFCs grew rapidly but there was no regukation of their asset side.
Barriers to entry.
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Privatisation of FIs
Establishment of PRDA.
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Thus monopoly over financial institutions till early 1990s was dismantled in a phased manner.
Development / Public Financial Institutions:Backbone of IFS till 2000 Addition to financing of industry in the form of project loans , underwriting , lease financing provided core working capital also.
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The focus shifted from development finance to that of promoting institutional infrastructure,geared to capital market development. ICICI securities and finance ltd., IFCI financial services ltd., IFCI investors services ltd.
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Thus development banks had assumed the character of financial conglomerates in contrast to their earlier role as 6/5/12 lending institutions.
Commercial Banks
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Incremental cost of opertion was more than incremental cost of income per rupee of working funds.
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Emergence of specialised institutions namely primary dealers and money market mutual funds.
call/notice market
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SEBI
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THANK YOU ..
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