Parliamentary Reflections: Analyzing the Conclusion of the 17th Lok Sabha

Conclusion of 17th Lok Sabha:

The 17th Lok Sabha concluded its proceedings on a Saturday, marking the end of its term amidst unexpected twists and turns.

Historical Parallel:

The conclusion of the previous Lok Sabha also involved an extended parliamentary
session, raising questions about whether history will repeat itself or a new precedent will
be set.

Performance of Parliament:

• Analysis of parliamentary proceedings reveals shifting priorities and interests of elected            representatives.

• Ministries of Health and Agriculture have gained prominence, while national security
and internal affairs have seen declining interest.

Focus on Economic Resurgence:

The Ministry of Finance, responsible for steering India’s fiscal destiny, has witnessed
declining parliamentary interest but a growing commitment to transparency.

Impact of COVID-19 Pandemic:

Despite disruptions in the education sector due to the pandemic, education remains a
significant topic in parliamentary discourse, albeit with challenges in oversight efficacy.

Utilization of Interventions:

• Usage of interventions like Zero Hour has significantly increased, indicating
heightened focus on addressing pressing issues and seeking clarifications from the

• However, there’s a need to balance the usage of different interventions to enhance
the quality of debate and reach amicable solutions.

Missed Opportunities and Oversight:

Instances of oversight, such as failure to raise privilege motions and missed discussions
on crucial issues like student suicides, highlight the need for revitalizing legislative
engagement and ensuring accountability.

Call for Constructive Debate:

Changing parliamentary dynamics emphasize the importance of seizing every
opportunity to foster constructive debate, enact policies prioritizing national welfare, and
ensure accountability from the government.

Recent RBI proposals


RBI Proposes UPI for Cash Deposits

The Reserve Bank of India (RBI) is considering enabling the Unified Payment Interface
(UPI) for cash deposits, leveraging its popularity and convenience. This move aims to
enhance customer convenience and reduce cash-handling load on bank branches.
Currently, cash deposits can only be made through debit cards, but enabling UPI for this
purpose will provide an additional digital payment option.

Facilitating Non-Resident Participation in Sovereign Green Bonds

To encourage wider non-resident participation in Sovereign Green Bonds (SGrBs), the
RBI has decided to allow eligible foreign investors in the International Financial Services
Centre (IFSC) to invest in such bonds. This decision is aimed at promoting investment in
environmentally sustainable projects.

Introduction of Mobile App for Retail Direct Scheme

The RBI will introduce a mobile app for its Retail Direct scheme, which was launched in
November 2021. This scheme allows individual investors to maintain gilt accounts with
the RBI and invest in government securities. The mobile app will streamline the process
of accessing and managing investments under the Retail Direct scheme, providing
investors with greater convenience and accessibility.

About Sovereign Gold Bond

Sovereign Green Bonds are a type of government-issued bond that is specifically
earmarked to raise funds for environmentally sustainable projects. These bonds are part
of a broader strategy adopted by governments worldwide to finance projects aimed at
addressing climate change, promoting renewable energy, and mitigating environmental


• Sovereign Green Bonds are issued by governments with the specific goal of raising
funds for projects that have positive environmental outcomes.

• These projects may include renewable energy infrastructure, energy efficiency
initiatives, sustainable transportation, afforestation, and climate adaptation measures.

Alignment with International Agreements:

• Sovereign Green Bonds are often issued in alignment with international agreements
and frameworks aimed at combating climate change, such as the Paris Agreement.

• By issuing these bonds, governments demonstrate their commitment to meeting
climate targets and supporting sustainable development goals.

Investor Demand:

There is a growing demand among investors, including institutional investors, sovereign
wealth funds, and environmentally conscious individuals, for investments that generate
both financial returns and positive environmental impact. Sovereign Green Bonds offer
investors an opportunity to invest in projects that contribute to environmental sustainability while also providing a financial return.

Financial Mechanism:

Sovereign Green Bonds operate like traditional government bonds, with investors
lending money to the government in exchange for periodic interest payments and the
return of the principal amount at maturity. The proceeds from the sale of these bonds
are earmarked for eligible green projects, providing a dedicated source of funding for
environmental initiatives.

Reporting and Transparency:

Governments issuing Sovereign Green Bonds typically commit to transparency and
accountability by providing detailed reporting on the allocation of funds and the
environmental impact of supported projects. This transparency helps build trust among
investors and ensures that the proceeds are used for their intended purpose.

Market Growth:

The market for Sovereign Green Bonds has experienced significant growth in recent
years, reflecting increasing awareness of environmental issues and the need for
sustainable finance. Many countries, including India, have entered the market to raise
capital for green projects and attract responsible investors.


Despite their benefits, Sovereign Green Bonds also face challenges, including the need
for clear eligibility criteria for green projects, standardization of reporting and certification
processes, and ensuring the additionality of funded projects.

RBI keeps repo rate on hold


What’s in news?

– The Reserve Bank of India (RBI) is concerned about the spike in food prices despite a               moderation in overall inflation.

– The Monetary Policy Committee (MPC) decided to maintain the policy repo rate under the         liquidity adjustment facility (LAF) at 6.50%.

– This decision marks the seventh consecutive time that the rates have been kept unchanged.

– RBI Governor Shakti kanta Das emphasized the MPC’s commitment to aligning inflation with    the target on a durable basis. While progress has been made in disinflation, there is still            work  to be done.

About RBI’s Monetary policy

The Reserve Bank of India (RBI) formulates and implements monetary policy in India with the primary objective of maintaining price stability while also supporting economic growth.

Policy Repo Rate:

• The policy repo rate is the rate at which the RBI lends short-term funds to commercial banks.

• It is one of the main tools used by the RBI to control inflation.

• When inflation is high, the RBI may increase the repo rate to reduce the money supply and       curb inflationary pressures.

• Conversely, when economic growth is sluggish, the RBI may lower the repo rate to stimulate     borrowing and spending, thus boosting economic activity.

Reverse Repo Rate:

• The reverse repo rate is the rate at which the RBI borrows funds from commercial banks. It       acts as a tool for liquidity management.

• By adjusting the reverse repo rate, the RBI can influence the amount of liquidity in the              banking system.

• An increase in the reverse repo rate encourages banks to park more funds with the RBI,          thereby reducing the money supply in the economy.

Cash Reserve Ratio (CRR):

• The CRR is the percentage of a bank’s total deposits that it is required to maintain as
reserves with the RBI in the form of cash.

• By adjusting the CRR, the RBI can control the amount of liquidity available to banks.
An increase in the CRR reduces the amount of funds available for lending by banks,
thereby curbing inflationary pressures. Conversely, a decrease in the CRR injects
liquidity into the banking system, stimulating lending and economic activity.

Statutory Liquidity Ratio (SLR):

• The SLR is the percentage of a bank’s total deposits that it is required to invest in
specified liquid assets such as government securities.

• Similar to the CRR, the SLR is used by the RBI to control liquidity in the banking system.

• Changes in the SLR affect the amount of funds available for lending by banks and
can influence interest rates.

Open Market Operations (OMO):

• OMOs involve the buying and selling of government securities by the RBI in the open market.

• By conducting OMOs, the RBI can influence the level of liquidity in the banking
system and manage interest rates.

• When the RBI buys government securities, it injects liquidity into the system, leading
to lower interest rates. Conversely, when the RBI sells government securities, it
absorbs liquidity, leading to higher interest rates.

Marginal Standing Facility (MSF):

The MSF is a window for banks to borrow funds from the RBI in case of emergency or
unanticipated liquidity requirements. The MSF rate is set higher than the repo rate,
providing a disincentive for banks to borrow from this facility unless absolutely

Liquidity Adjustment Facility (LAF):

The LAF consists of the repo rate, reverse repo rate, and MSF. It provides a framework
for managing short-term liquidity in the banking system. Banks can borrow or lend funds
to the RBI through the LAF window to meet their short-term funding needs.