NEW DELHI - March 16, 2007 – An antiquated banking system holds back development in India. Government control and old attitudes hold back growth and change.
Janpath, a traffic-choked mini-highway that runs through central Delhi, is home to some of the city's best-known jewelry stores and five-star hotels and, less famously, to dozens of bank branches. Nestled behind metal gates in multi-storey concrete buildings and tucked-down alleyways off the street, they jockey for attention with battered signs and offers of high rates for deposits and low-rate loans.
What is remarkable about these competitors though is that most of them are controlled by the same owner: the Indian government.
Just as the lack of reliable roads, transportation and electricity are dampening India's growth, the country's overlapping and inefficient financial system threatens to choke it. Consultants at McKinsey estimate that $48 billion could be added to India's annual gross domestic product, bringing its growth rate on a par with China's, if the country's largely state-controlled financial system were made more productive.
India's banking system has its roots in centuries-old regional banks that spread as their customers migrated, then were nationalized. The major banks were nationalized in 1969 under Prime Minister Indira Gandhi. Improvements included targets for lending to rural areas and promises of secure jobs, including for the underclass.
The legacy of banks as tools for social reform, though, is colliding with India's plans to become a global economic powerhouse. An estimated 70 percent of Indian citizens are still not reached by banks, and the bureaucracy and inefficiencies of the system are leaching benefits from fast-growing parts of the economy. By Heather Timmons - International Herald Tribune.
Miles to go before you sleep…
We at Librahitech would like to see a government in India that is formed by an younger genre of well-educated politicians who are both pragmatic and patriotic in their approach toward the well-being of the entire populace of the country. Their vision and mission shall also be to transform India to become a world economic power and a model for the poorer nations of this world to emulate.
We, from the desk of Librahitech, herewith send a clarion call to the people of India to be aware that the country belongs to them, and it is NOT the property of the Nehru family.
We would like to add here that as long as the Congress Party is there and runs the government, India will continue to go to the dogs, unless of course the foreign elements and the incompetent old guard in the party is weeded out.