India’s aborted central bank plan has few mourners

May 4, 2015

The government has withdrawn a proposal to curb the Reserve Bank of India’s sway over the bond market. It’s a welcome retreat. Retrospective taxes on foreign investors have already dented confidence. Clipping the wings of a well-functioning regulator would have caused more alarm.

India’s poor state banks will test investor limits

April 22, 2015

State Bank of India is leading the rush to raise capital with a $2.4 bln share sale. A stronger economy makes bad debts look less bad. Investors will also have to believe a government pledge to meddle less in lending decisions. Even so, few banks look tempting.

Daiichi Sankyo scrubs out Indian M&A nightmare

April 21, 2015

Last year the Japanese firm folded its stake in troubled Indian drugmaker Ranbaxy into local rival Sun Pharma for 40 pct less than it paid in 2008. A share rally means Daiichi has recovered its losses on the seven-year misadventure. It shows the power of appropriate ownership.

Tax shockers ramp up India investor risk premium

April 17, 2015

The country wants $6.4 billion in what it says are unpaid taxes from foreign funds. Private equity firms could be the next target. The frequent adjustments to tax policy raise a red flag. Investors will have to demand higher returns to insure against future fickleness.

Guest view: The RBI does need its wings clipped

By Guest Contributor
April 2, 2015

The Reserve Bank of India’s repressive influence is stunting the growth of finance. Governor Raghuram Rajan is fighting attempts to shrink the RBI’s role because of pushback from his officers, says Percy Mistry, author of a 2007 report on making Mumbai a global financial centre.

Tata Motors’ $1.2 bln share issue is well timed

April 1, 2015

The carmaker wants to raise cash to reduce debt and fund growth. Its struggling domestic unit, propped up by Jaguar Land Rover, is benefiting from a recent change in strategy. A full turnaround will depend on a pickup of economic activity in India.

Clipping Indian central bank’s wings is bad idea

March 30, 2015

The Reserve Bank of India is facing a campaign to undermine it. Subjecting its regulatory decisions to judicial review will erode its authority. Removing the bond market from its control serves little purpose. Investors can live with a bossy RBI, but not a weak one.

India’s boardroom diversity drive has weird result

March 27, 2015

Companies have met demands they dilute male dominance by installing wives and stepmothers as directors. Some women now sit on as many seven boards. Indian corporate governance needs improving and gender diversity can boost financial returns. But mandating change isn’t the answer.

Finding double-digit growth in India’s GDP fog

March 17, 2015

New statistics are deceptively rosy. If the economy can grow 7.4 pct when local interest rates are high and world demand low, how tough would 10 pct be? But complacency may lead to bad policies. Efficiency trends peg potential GDP growth at just 7 pct. Only reforms can lift it.

India’s “tax terrorism” proves hard habit to kick

March 13, 2015

The government could honour a campaign pledge to make taxation more certain by scrapping a rule that allows it to seek payment for past transactions. That is politically fraught but may be less damaging than pursuing the likes of Britain’s Cairn Energy for old deals.