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WBCS Optional Economics Course (Note: Optional Economics has very high success rate in WBCS)

WBCS Optional Economics Course

(Note: Optional Economics has very high success rate in WBCS)

Success rate measures the percentage of candidates getting selected with an optional subject No wonder this rate is among the lowest for so called popular subjects like Anthropology and Psychology. 

The Course is conducted by a Professor of Economics who himself topped WBCS with Economics as Optional Subject (and worked as Deputy Magistrate and Deputy Collector) . 

The Course covers the entire syllabus as given below: 

Paper – I : Micro-Economic Theory and Macro-Economic Theory (Market and Price Determination : Functions of Money : full employment and Say’s Law : Modern Monetary System : Public Finance : International Economics : Growth and Development Economics).

Paper – II : Indian Economy (Evolution of Indian Economy till Independence : Indian Economics in Post-Independence Era.)

Course Fees:

For Class Room Guidance: Total course fees: Rs. 15000 only. Fee Break-up: Admission Fee: Rs.1000; Course Materials Fee: Rs. 5000 (payable in two installments of Rs.2500, first at the time of admission and the second at the beginning of 4th month). Monthly Tuition Fees: Rs.1500 (x 6 months). Pay Rs. 5000 (Rs. 1000 + Rs. 2500 + Rs. 1500) at the time of admission. Course Duration: 6 Months.

Class room course includes regular assessment and tests. More stress on developing writing skills.  

For Postal Guidance: Total course fees: Rs. 8000 only. Admission Fee: Rs.1000; Course Materials Fee: Rs. 5000. Courier charges: Rs.2000. Pay Rs.8000 in all. Study materials will be sent to your address over a period of six months.

Enrol now and be confident. Take advice from an Expert (Professor and Author). Many of his students have got selected in the IAS and allied services, Indian Economic Service (in fact, one of  his student stood first in the IES), and also in the WBCS (Executive).  

For more details, write to:

 wbcsstudyroom@gmail.com 

or sms/call +919051484147

My course is available online on Wiziq

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Enroll now:Limited Seats

7th Foundation Course on Indian Economics for 

WBCS Mains, 2013

Classes have started on Sunday 9 June, 2013

ADMISSION IS STILL OPEN

JOIN NOW, FEW SEATS

(The Course is strictly meant for very serious candidates who want to make it (WBCS) in their very next attempt or want to go for higher services (IAS) in the immediate future.)

For WBCS aspirants main problem is to find appropriate books for Five Year Plans in India. BA pass course books published from West Bengal are not adequate. Similarly, books from Delhi cover too much topics all of which are not relevant for WBCS. And without proper guidance and study materials students score miserably in this section. This amounts to wastage of time, chances and money.

The course focuses on Indian Economics, its Economic and Social Development during Five Year Plans, including Financial Sector Reform, Sustainable Development, Education and Health, Inclusion and Social Justice etc. The course is conducted by an economist (University rank-holder) who is also a WBCS (Exe) Topper (among the first ten) in first attempt. Many of his students have got selected in the IAS and allied services, Indian Economic Service (in fact, one of  his student stood first in the IES), and also in the WBCS (Executive). He has been a regular contributor to CSR and has edited one Magazine on Competitive Examination. He is now working as a member of board of editors of a forthcoming Manual for IAS Examination to be published from New Delhi in July this year. He has been associated with WBCS teaching for the last five years. He is also a member of the mock interview board of a leading Training Centre in Kolkata. The course and its study materials would immensely benefit aspirants of West Bengal Civil Service.

Normally non-economics background candidates get lowest marks in Five Year Plans. Your confidence as well as marks will greatly improve after attending this course. This course will help you further at the time of interview.

Admission is open. The course commences from June, 2013. Weekly classes near Lake Town, Kolkata. Batch I Full. Few seats available in Batch II. Only 8-10  candidates per Batch. Individual attention. Extended classes of at least 3 hours every week. Special Classes if required. Quarterly Tests.

Course Fees:

For Class Room Guidance: Admission Fee: Rs.1000; Course Materials Fee: Rs. 1000. Monthly Tuition Fees: Rs.1000. Pay Rs. 3000 at the time of admission. Rest in two installments in successive months. Total course fees: Rs. 5000 only. Course Duration: 3 Months. 

For Postal Guidance: Admission Fee: Rs.1000; Course Materials Fee: Rs. 1000. Courier charges: Rs.1000. Pay Rs.3000 in all. Study materials will be sent to your address.

Enrol now and be confident.
For more details, write to:

 wbcsstudyroom@gmail.com 

or sms/call +919051484147

Excerpts of the Study Materials on Indian Economics: Monetary Policy in India

Traditional and New Tools of Monetary Policy

Bank Rate Policy: Bank rate is the rate at which the central bank of a country provides loan to the commercial banks. If the bank rate is low, the banks are encouraged to borrow reserves against which they can advance loans. This facilitates credit creation. An upward revision of this rate discourages borrowing and exerts a contractionary effect on money stock. When central bank raises the bank rate, the commercial bank raises their lending rates, and it results in less borrowings and reduces money supply in the economy.

Open Market Operations: Open market operation consists of purchase and sale of securities by the central bank of the country. The sale of security by the central bank leads to contraction of credit and purchase thereof leads to credit expansion.

Cash Reserve Ratio: Cash Reserve Ratio is a certain percentage of bank deposits which banks are required to keep with RBI in the form of reserves or balances. When CRR is increased, the loanable funds at the disposable of commercial banks get reduced and the money supply contracts. The opposite effect occurs if the CRR is reduced. This increases the ability of the banks to create deposit money. Since it is rather a drastic way to change the money supply, the variation in CRR is not used very frequently.

Selective Credit Control: Selective Credit Controls  are aimed at regulating  the distribution of credit amongst sectors or purposes. RBI uses this measure to prevent speculative hoarding of essential commodities and chech undue rises in prices. Selective credit control measures include fixing the margin requirements for loans, fixing the maximum limit for advances and charging discriminatory interest rates on selective advances. RBI may also instruct banks not to provide loans for a specific purpose.

Repo Rate:  Repo (Repurchase) rate is the rate at which the RBI lends shot-term money to the banks against securities. When the repo rate increases borrowing from RBI becomes more expensive.  Therefore, we can say that in case, RBI wants to make it more expensive for the banks to borrow money, it increases the repo rate; similarly, if it wants to make it cheaper for banks to borrow money, it reduces the repo rate.

Reverse Repo Rate: Reverse Repo rate is the rate at which banks park their short-term excess liquidity with the RBI.  The banks use this tool when they feel that they are stuck with excess funds and are not able to invest anywhere for reasonable returns.  An increase in the reverse repo rate  means that the RBI is ready to borrow money from the banks at a higher rate  of interest. As a result, banks would prefer to keep more and more surplus funds with RBI.

Thus, we can conclude that Repo Rate signifies the rate at which liquidity is injected in the banking system by RBI, whereas Reverse repo rate signifies the rate at which the central bank absorbs liquidity from the banks

(Continued next page) 
(From my forthcoming book on IAS General Studies Manual being published by Access Publishing India Pvt. Ltd., New Delhi).

Excerpts of Study Materials on FYP: Financial Sector Reforms

Narasimham Committee Report

In November 1991, a committee set up by the Government to study the working of the financial system, better known as the Narasimham Commmittee, submitted its report. The main recommendations of the Committee were: a) to bring down the SLR in a phased manner to 25 per cent over five years; b) to use the CRR as an instrument of monetary policy and not as a means of controlling the secondary expansion of credit brought about by monetization of the fiscal deficit; c)  to  phase  out  directed  credit  programmes  and  to  reduce the requirement to lend to ‘priority sectors’ down to 10 per cent of aggregate credit; d) to bring the interest rate on government borrowing in line with other market-determined interest rates and to phase out concessional interest rates; e) that banks and financial institutions achieve a minimum 4 per cent capital adequacy ratio in relation to risk weighted assets by March 1993; f) that the more profitable public sector banks be permitted to issue fresh capital to the public through the capital market; g) that banks and financial institutions adopt uniform accounting practices in regard to income recognition and provisioning for non-performing loans; h) that branch licensing be abolished and the matter of opening and closing of branches be left to the commercial judgement of individual banks; i) to liberalize policies toward foreign banks with regard to the opening of offices as branches or subsidiaries; j) that a quasi-autonomous body under the aegis of the RBI be set up to supervise banks and financial institutions; k) to phase out the privileged access of development finance institutions to concessional finance; and l) in the capital market, freedom be given to issuers of capital to decide on the nature of the instrument, its terms and its pricing. The recommendations of the committee provided the blueprint of the reforms that followed in the financial sector.

Most of the major recommendations of the Narasimham Committee have been implemented. We summarise them below:

(i)                              Cash Reserve Ratio: Average CRR was reduced from 15 percent to 14.5 percent in 1993-94 and gradually to 10 per cent in 1996-97.

(ii)                            Statutory Liquidity Ratio: SLR got reduced from 38.5 per cent to 31.5 per cent in 1994-95 and further to 27 per cent in March,1997.

(iii)                          Lending rates structure has been rationalised with six categories being reduced to three by 1993-94 and to 2 in 1994-95.

(iv)                           Minimum lending rate(MLR) for credit limit of over Rs.2 lakhs has been reduced from 20 percent to 14 percent by 1993-94 and abolished by 1994-95.

(v)                             Interest rate on domestic term deposits above one year and on non-residential non-repatriable (NRNR) rupee deposits has been decontrolled.

(vi)                           An agreement has been reached in 1994-95 between RBI and the GOI on pre-determined limit on net issue of ad hoc T bills.

(vii)                         A risk-asset ratio system for banks was introduced in 1991-92 as a capital adequacy measure.

(viii)                       A system of income recognition and provisioning for non-performing loans was introduced in 1991-92. As funding required for provisioning was placed at Rs.14000 crores, it was phased over two years. The GOI made a capital contribution of Rs.5700 crores in the budget for 1993-94 and another Rs.5600 crores in the budget for 1994-95.

(ix)                          The Board of Financial Supervision (BFS) was set up in 1994-95 under the Chairmanship of Governor of RBI to ensure implementation in asset classification, income recognition, and capital adequacy. RBI has set up BFS and a new department called Department of Supervision to strengthen the supervisory and surveillance system of banks and financial institutions.

(x)                            Approval was given by RBI ‘in principle’ for establishment of new banks in the private sector. Branch licensing policy was liberalised considerably.

(xi)                          ‘Banking Companies Acts’ of 1970-80 were amended in 1994-95 to raise capital by nationalised banks up to 49 per cent from the public. SBI was the first to raise through public issue over Rs.1400 crores as equity, and Rs.1000 crores as bonds.

(xii)                        Regarding capital markets, SEBI was granted statutory powers. Functions of Controller of Capital Issues was transferred to SEBI.

Malhotra Committee Report on Insurance Sector Reform

In April 1993, the Government of India appointed a committee under Chairmanship of R.N. Malhotra, former Governor of RBI, to look into the possibilities of reforms of the insurance sector. The committee submitted its report in January 1994 with a reform package containing wide ranging suggestions on both organizational and functional aspects of the insurance sector. Some of the important recommendations are: (i) The private sector should be allowed to enter the insurance business, (ii) The proportion of LIC and GIC investments in Government securities should be reduced, iii) Government stake in the LIC  and GIC  should be reduced through disinvestment.

A brief overview of the other financial institutions and the effects of financial liberalization on their workings suggest the following broad conclusions:

i)      Captive and subsidized sources of funds to almost all the all India development banks have been reduced and consequently they have been forced to turn to the market for funds.

ii)  There has been a phased deregulation of interest rates.

iii) SIDBI which lends and refinances loans that are exclusively made to the  small  scale  sector  continues  to  receive  support  from  the Government of India and RBI in terms of subsidized credit.

iv) The refinancing operations of both SIDBI and IDBI have reduced substantially after 1990-1.

v) The mutual funds business has been opened up for entry to private firms thus ending the monopoly position that UTI enjoyed. A comprehensive set of regulations regarding the organization and operations of mutual funds is now in place.

vi) The insurance sector reform has begun with the opening of this sector to the private sector.

(Continued next page)
(From my forthcoming book on IAS General Studies Manual being published by Access Publishing India Pvt. Ltd., New Delhi).

Excerpts of Study materials on FYP: Twelfth Plan (2012-17)

Twelfth Plan (2012-17)

Visions and Aspirations:
The broad vision and aspirations which the Twelfth Plan seeks to fulfil are reflected in the subtitle:
‘Faster, Sustainable, and More Inclusive Growth’. The simultaneous achievement of each of these elements
is critical for the success of the Plan.
The Need for Faster Growth
The Twelfth Plan fully recognizes that the objective of development is broad-based improvement in the economic and social conditions of our people. However, rapid growth of GDP is an essential requirement for achieving this objective.
There are two reasons why GDP growth is important for the inclusiveness objective. First, rapid growth of GDP produces a larger expansion in total income and production which, if the growth process is sufficiently inclusive, will directly raise living standards of a large section of our people by providing them with employment and other income enhancing activities. The second reason why rapid growth is important for inclusiveness is that it generates higher revenues, which help to finance critical programmes of inclusiveness. There are many such programmes such as Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), Sarva Siksha Abhiyan (SSA), Mid Day Meals (MDMs), Pradhan Mantri Gram Sadak Yojana (PMGSY), Integrated Child Development Services (ICDS), National Rural Health Mission (NRHM), and so on which either deliver benefits directly to the poor and the excluded groups, or increase their ability to access employment and income opportunities generated by the growth process.
Growth Prospects
The Approach Paper to the Twelfth Plan had set a target of 9 per cent average growth of GDP over the Plan period. That was before the Eurozone crisis in that year triggered a sharp downturn in global economic prospects, and also before the extent of the slowdown in the domestic economy was known. Taking account of all these factors, the Twelfth Plan had set a target for an average growth rate of about 8.2 per cent in the Plan period. Two sub-targets of growth rates are: 4 per cent for the agricultural sector and 10 per cent for the manufacturing sector.
The Twelfth Plan’s strategy for growth depends crucially on productivity gains as one of the key drivers of growth. These traditional sources of growth are not likely to be enough for India in the coming years and we must therefore focus much more on productivity improvements among all constituents: big businesses, MSMEs, farmers and even government. This can be done by improving the business regulatory environment, strengthening the governance capacity of States, investing more in infrastructure rather than subsidies, and by using Science and Technology (S&T) to drive innovation.
The Twelfth Plan should aim at a growth process that preserves emphasis on inclusion and sustainability while minimising downside effects on growth. This inclusive strategy involves a much greater role of the States, and closer coordination between the Centre and the States. This is because most of the policy measures and institutional support required for small and medium entrepreneur led growth lie in the domain of State Governments and local bodies. The Centre’s contributions would lie mainly in creating the appropriate macroeconomic framework, financial sector policies and national level infrastructure.
(Continued next page)
(From my forthcoming book on IAS General Studies Manual being published by Access Publishing India Pvt. Ltd., New Delhi).