BasisPoint Insight

𝐌𝐢𝐜𝐡𝐚𝐞𝐥 𝐏𝐚𝐭𝐫𝐚 𝐨𝐧 𝐇𝐨𝐰 𝐑𝐁𝐈 𝐂𝐚𝐧 𝐀𝐜𝐜𝐞𝐬𝐬 𝐃𝐨𝐥𝐥𝐚𝐫𝐬 𝐖𝐢𝐭𝐡𝐨𝐮𝐭 𝐒𝐞𝐥𝐥𝐢𝐧𝐠 𝐑𝐞𝐬𝐞𝐫𝐯𝐞𝐬 | 𝐅𝐈𝐌𝐀 𝐄𝐱𝐩𝐥𝐚𝐢𝐧𝐞𝐝 We break down how the Reserve Bank of India can access dollar liquidity without selling its US Treasury holdings, as explained by 𝐟𝐨𝐫𝐦𝐞𝐫 𝐑𝐁𝐈 𝐃𝐞𝐩𝐮𝐭𝐲 𝐆𝐨𝐯𝐞𝐫𝐧𝐨𝐫 𝐌𝐢𝐜𝐡𝐚𝐞𝐥 𝐏𝐚𝐭𝐫𝐚 in his column for BasisPoint. The Federal Reserve’s FIMA repo facility allows central banks to temporarily swap US Treasuries for dollars, providing a backstop during global stress. With around $190 billion in US Treasuries, the RBI has a powerful but under-discussed tool to stabilise currency markets and manage volatility. Could this reduce pressure on the rupee and reshape India’s external strategy? 𝐅𝐮𝐥𝐥 𝐥𝐢𝐧𝐤 𝐟𝐨𝐫 𝐭𝐡𝐞 𝐚𝐫𝐭𝐢𝐜𝐥𝐞 𝐢𝐧 𝐜𝐨𝐦𝐦𝐞𝐧𝐭𝐬. #RBI #FEMARepo #USDollar #Indianeconomy #rupee #macroeconomics

India’s energy policy is trying to move in two directions at once. One push doubles down on gas pipelines and fossil infrastructure. The other commits to an electro-state future built on renewables, grids and electrification. Both cannot define the same decade. If this is a moment of crisis-driven choice, what is India really optimising for—security today or resilience tomorrow? And are we building systems that solve the next constraint, or extending the last one? Read Sharmila Chavaly’s column — 𝐖𝐡𝐲 𝐖𝐚𝐬𝐭𝐞 𝐚 𝐆𝐨𝐨𝐝 𝐂𝐫𝐢𝐬𝐢𝐬: 𝐓𝐡𝐞 𝐏𝐢𝐩𝐞𝐥𝐢𝐧𝐞 𝐏𝐚𝐫𝐚𝐝𝐨𝐱 (link in Comment section) #EnergySecurity #Geopolitics #InfrastructureStrategy #EnergyPolicy #PipelinePolitics #GlobalEnergy #StrategicShift

RBI policy isn’t the only driver of liquidity. Data suggests sharp swings in state government cash balances may also influence India’s banking system liquidity cycle.

Slightly late, but as always relevant!!! As Indian workplaces celebrated International Women’s Day this year, as every year, the usual share of fanfare and fatigue remained. We have travelled a long distance get a seat at the table, yet we remain invisible and unheard at the table. For many, indeed, the celebrations remain 'token'; this reminding us why the triumphs remain lost in translation. Three key questions arise: first, why in India, does the female labor force participation remain low? Second, why do the rungs remain broken as women attempt to climb the ladder? And finally, why does the glass ceiling remain intact? Our article (thank you, Prof Abhiman Das, for joining me on this) in Basis Point Insight today talks about this and what strategies can help! https://lnkd.in/dKvt3Urx #Gender #femalelaborforceparticipation #workplace #women

The West Asia conflict is not a distant geopolitical event for India’s financial system. It is a multi-channel stress test, where oil prices, currency volatility, liquidity conditions and operational risks are interacting simultaneously. The challenge is no longer about managing individual shocks, but about understanding how they reinforce each other across balance sheets, markets and institutions. The real question is whether the system is prepared for correlated stress. Can liquidity support, supervision and internal risk discipline work together without distorting markets? And in a world of intertwined risks, is stability about reacting to shocks, or anticipating how they propagate? Read Anupam Sonal's column for BasisPoint: 𝐒𝐚𝐟𝐞𝐠𝐮𝐚𝐫𝐝𝐢𝐧𝐠 𝐅𝐢𝐧𝐚𝐧𝐜𝐢𝐚𝐥 𝐒𝐭𝐚𝐛𝐢𝐥𝐢𝐭𝐲 𝐚𝐦𝐢𝐝𝐬𝐭 𝐭𝐡𝐞 𝐖𝐞𝐬𝐭 𝐀𝐬𝐢𝐚 𝐂𝐫𝐢𝐬𝐢𝐬 (link in Comment section) #FinancialStability #GlobalShocks #RiskManagement #MacroStability #IndiaEconomy #Geopolitics #EconomicResilience

I write in BasisPoint Insight: India is not yet in a full-blown economic crisis, but the signals are hard to ignore. Crude oil at ~$110. Rupee at 94. Rising logistics costs. Early signs of stress in petrochemicals and supply chains. This is how crises begin—not with collapse, but with pressure building across multiple fronts. In my latest op-ed, “Balancing on the Brink: India’s Economic Policy in a Time of Crisis,” I examine how the current moment compares with 2012–14—when India faced a far deeper crisis, but responded with clarity, sequencing, and credibility. The contrast is instructive. Today, policy is active—but fragmented. We are managing consequences, not yet shaping outcomes. And increasingly, perception—both domestic and global—is becoming a constraint rather than an asset. The question is not whether India has the capacity to respond. It is whether policy can restore direction and confidence—before events begin to dictate the terms. Would value thoughts from fellow practitioners, policymakers, and students of public policy. https://lnkd.in/gjCbCVPp Indian Ministry of Finance NITI Aayog Reserve Bank of India (RBI) National Institute of Public Finance and Policy (NIPFP) Public Affairs Forum of India Confederation of Indian Industry FICCI #IndiaEconomy #EconomicPolicy #Macroeconomics #PublicPolicy #Geopolitics #EnergyCrisis #Inflation #Rupee #FiscalPolicy #GlobalEconomy #PolicyMaking #India

𝐈𝐧𝐝𝐢𝐚 𝐦𝐚𝐲 𝐧𝐨𝐭 𝐛𝐞 𝐢𝐧 𝐚 𝐟𝐮𝐥𝐥-𝐛𝐥𝐨𝐰𝐧 𝐜𝐫𝐢𝐬𝐢𝐬 𝐲𝐞𝐭, 𝐛𝐮𝐭 𝐭𝐡𝐞 𝐩𝐫𝐞𝐬𝐬𝐮𝐫𝐞𝐬 𝐚𝐫𝐞 𝐛𝐞𝐠𝐢𝐧𝐧𝐢𝐧𝐠 𝐭𝐨 𝐚𝐥𝐢𝐠𝐧 𝐢𝐧 𝐰𝐚𝐲𝐬 𝐭𝐡𝐚𝐭 𝐚𝐫𝐞 𝐡𝐚𝐫𝐝 𝐭𝐨 𝐢𝐠𝐧𝐨𝐫𝐞. Rising oil prices, a weakening rupee, imported inflation and supply-side stress are tightening the macro environment, even as policy remains active but largely defensive. The contrast with 2012–14 is instructive. Then, sharper stress was met with clearer priorities, sequencing and coordination, which helped shift expectations and restore stability. If this is a crisis in formation, not yet in full view, where is the clarity of direction today? Can multiple objectives be pursued without a visible hierarchy? And if expectations begin to shift, will policy shape the trajectory as it did in 2012–14, or simply manage the consequences? Read a column by Arvind Mayaram who was Finance Secretary to the Government during 2012-14. (link in Comment section) #IndianEconomy #EconomicPolicy #MacroStability #PolicyTradeoffs #CrisisManagement #InflationRisk #GrowthOutlook

𝐀 𝐒𝐲𝐬𝐭𝐞𝐦 𝐓𝐡𝐚𝐭 𝐀𝐝𝐣𝐮𝐬𝐭𝐬 𝐛𝐲 𝐌𝐨𝐯𝐢𝐧𝐠 𝐭𝐡𝐞 𝐏𝐚𝐢𝐧 𝐒𝐨𝐦𝐞𝐰𝐡𝐞𝐫𝐞 𝐄𝐥𝐬𝐞 It seems like we’re not really absorbing shocks anymore, just moving them around. Oil markets are splitting by route, the rupee is taking more of the hit than it should, and policy seems more focused on smoothing things over than letting adjustments play out. You see the same pattern elsewhere too. In governance, in regulation, even in how capital is sitting idle. 𝐂𝐡𝐞𝐜𝐤 𝐨𝐮𝐭 𝐚𝐥𝐥 𝐨𝐟 𝐭𝐡𝐢𝐬, 𝐚𝐧𝐝 𝐦𝐨𝐫𝐞, 𝐨𝐧 𝐁𝐚𝐬𝐢𝐬𝐏𝐨𝐢𝐧𝐭 𝐈𝐧𝐬𝐢𝐠𝐡𝐭 𝐢𝐧 𝐭𝐡𝐞 𝐰𝐞𝐞𝐤 𝐠𝐨𝐧𝐞 𝐛𝐲. Aabhas Pandya, Dhananjay Sinha, GURUMURTHY R, Sakshi Gupta, Madhavi Arora, Arvind Chari, Gaura Sengupta, Venkat Thiagarajan, Rajesh Mahapatra, Anupam Sonal, Krishnadevan V, Srinath Sridharann, Dr. Rabi Narayan Mishra, Ph.D (Economics), Chandrika Soyantar, Sangeeta Godbole, Sharmila Kantha, Arvind Mayaram #SystemicRisk #EconomicAdjustments #HiddenRisk #FinancialStability #RiskTransfer #MacroEconomics #EconomicNarratives

The RBI’s tightening of banks’ overnight position limits has reignited a familiar debate. Is this a necessary check on speculative positioning, or a constraint that weakens the market’s ability to absorb shocks? When banks blur the line between intermediation and position-taking, discipline becomes unavoidable. But there is a trade-off. Limiting banks’ ability to warehouse flows can reduce market depth, forcing sharper price moves or greater reliance on the central bank’s balance sheet. The real question is not intervention versus markets, but how to balance discipline with liquidity when the system is under stress. Read GURUMURTHY R’s column for BasisPoint: 𝐌𝐚𝐧𝐚𝐠𝐢𝐧𝐠 𝐭𝐡𝐞 𝐑𝐮𝐩𝐞𝐞, 𝐂𝐨𝐧𝐬𝐭𝐫𝐚𝐢𝐧𝐢𝐧𝐠 𝐭𝐡𝐞 𝐌𝐚𝐫𝐤𝐞𝐭 (link in Comment section) #IndianRupee #FXManagement #MarketSignals #PriceDiscovery #MonetaryPolicy #CapitalMarkets #MacroEconomics

Board independence in India was designed to act as a counterweight to concentrated power. In practice, it is increasingly becoming a managed outcome. Independent directors are expected to ensure accountability, yet often operate within invisible constraints shaped by those they are meant to question. When dissent is curated rather than enabled, governance risks becoming performative and accountability unrealistic. The deeper issue is one of shared complicity. As long as promoters, boards and even the regulatory system accept this equilibrium, independence will remain an illusion. Real change requires acknowledging this reality and rethinking how independent directors are appointed, empowered and protected. Dr. Rabi Narayan Mishra, Ph.D (Economics) & Srinath Sridharann write in this joint column. (link in Comment section) #CorporateGovernance #BoardIndependence #IndependentDirectors #GovernanceRisk #BoardOversight #InstitutionalReform #IndiaInc