Archive for April 24th, 2020

Centre’s WMA update: Highest weekly WMA since 2004!

April 24, 2020

On 20 Apr-2020, RBI revised the Centre’s WMA from 1.2 lakh crore to Rs 2 lakh crore.

Meanwhile till 17-Apr-2020, WMA has been rising every week. On 17-Apr-2020, Centre availed WMA worth Rs 135451 crore, which is highest in WSS since 2004.

This is how WMA looks since Jan-2020:

WMA Limit Actual WMA availed
03-Jan-20 35000 130171
10-Jan-20 35000 60605
17-Jan-20 35000 87735
24-Jan-20 35000 24184
31-Jan-20 35000 73545
07-Feb-20 35000 23324
14-Feb-20 35000 6817
21-Feb-20 35000 0
28-Feb-20 35000 5081
06-Mar-20 35000 32976
13-Mar-20 35000 20553
20-Mar-20 35000 0
27-Mar-20 35000 50477
03-Apr-20 120000 40008
10-Apr-20 120000 110942
17-Apr-20 120000 135451
20-Apr-20 200000

Macroeconomic effects of Covid-19: an early review and comparing to previous pandemics

April 24, 2020

Nice short piece by BIS economists Frederic Boissay and Phurichai Rungcharoenkitkul:

The cost-benefit analysis in health policies certainly goes beyond accounting for economic gains and losses. But even from a narrow economic perspective, the adequate course of action is far from settled. On the one hand, the high output losses from global efforts to contain the Covid-19 pandemic are
unprecedented. On the other hand, it is unclear if the counterfactual scenario would be less costly – an uncontrolled pandemic such as the 1918 Great Influenza resulted in substantial and persistent damages. A better understanding of the transmission channels of the Covid-19 shock to the economy, the interaction between economic decisions and the epidemic, and the policy trade-offs is therefore needed.


Mapping the Appointments and Tenures of Supreme Court Judges

April 24, 2020

Alok Prasanna Kumar of Vidhi Centre for Legal Policy has written a nice paper in EPW:

The debate about the tenure of judges of the Supreme Court of India is fixated somewhat unnecessarily on the retirement age than the actual time spent in the Court. Examining the length of the tenure gives some hints as to the unwritten criteria of appointment and may potentially offer a deeper understanding of the systemic problems faced by the courts.


A minimum of 1,000 days’ tenure (approximately three years) and a maximum of 3,000 days’ tenure (approximately nine years) seem to be the unwritten criteria for selection of judges to the Supreme Court (Chandrachud 2014: 148–63). Given the current pattern, the record of P N Bhagwati as the longest serving judge of India is safe, as is the record of Y V Chandrachud as the longest serving CJI.

Does the reduction in the median expected tenure of judges and CJIs have any implications for the institution? Chandrachud’s book delves into this global debate: Asian nations such as South Korea and Japan have shorter tenures for Supreme Court judges, while European and American courts tend to have much longer tenures (2014: 151–61). However, given the specifics of the Indian Supreme Court, three areas of potential concern present themselves.

One, the massive attrition means that more time and energy is spent by senior judges and the government in filling up posts, failing which the number of vacancies increases, adding to the pressure on the remaining judges. In the absence of long tenures, appointments to the SC are a never-ending process, as in any given year a significant number of Supreme Court judges keep retiring. Some years, nearly a third of the Court retires; in 2013, 10 judges retired and the same number is expected to retire in 2022.

Two, shorter tenures also mean shorter tenures as CJI, meaning that any attempt at long-term institutional change will be hard to oversee to completion and any changes may very well be undone by successors. Given the short tenure, and the fact that the Supreme Court as an institution may have its own peculiarities, judges may take some time to even get acquainted with the Court, but, by the time they do, it is almost time for them to go (Chandrachud 2014: 269).

Three, a short tenure may not create a sense of ownership in other judges to think of the institution and its needs. Having spent the bulk of their careers in their parent high courts, a four- to five-year year term in a different court at the end of their tenures may not be conducive in getting them to invest time and energy in adding to the institution, leaving them to function like cogs in a wheel.

Addressing these concerns may require both an increase in the retirement age of judges (as has been suggested in many fora) (Paul 2018; ANI 2018), but also in coming up with definite criteria for appointment to ensure that judges serve at least a decade in the Supreme Court. This might ensure stability in the functioning of the Court and allow judges to shape the way it works, rather than simply letting inertia do it for them.


Robust money markets: Lessons from the first globalisation

April 24, 2020

Olivier Accominotti, Delio Lucena-Piquero and Stefano Ugolini in this voxeu piece review importance of money markets.

Informational problems on the money market can lead to credit booms and financial panics. This column shows that, during the first globalisation of 1880-1914, uncollateralised international corporate debts were transformed into highly liquid and safe money market instruments through a refined process of information production involving various intermediaries. This suggests that the design of money market instruments is an essential determinant of the liquidity and resilience of money markets.


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