Dear Pavan
I've spoken to my always reliable sources.
The funds deposited in US Bonds are on account of payments + accrued
interest which India owes USA since 1950's on account of PL-480 food
aid (most of which was fungus and mercury contaminated rotten wheat
unfit even for cattle), which has now reached gigantic levels.
http://www.epw.in/system/files/pdf/1959_11/45/the_new_p_l_480_agreement.pdf
Hopefully, Mr. Modi will be able to get us out of this "humiliation"
which Congress made us swallow under Ms. (Indira) Gandhi when he
visits USA next month.
http://archive.indianexpress.com/news/swallowing-the-humiliation/645168/0
IAC members should read both these links.
Sarbajit
On 8/21/14, Sarbajit Roy <
sroy.mb@gmail.com> wrote:
> Dear Pavan
>
> 4 words spring to mind.
> (A) PONZI
> (B) Ever-Greening
> (C) Leverage
> (D) Corruption
>
> Probably RBI is doing in USA what banks like SBI, Syndicate Banks and
> all are doing in India. Its the old scheme of bank skimming, deposit
> 20% with me at (cheap rates) and I'll keep giving you loans upon loans
> upon loans (so long as I keep getting my kickbacks) - Kingfisher,
> Bhushan Steels, Pramod Mittal,
>
> Experts like Ms Sucheta Dalal etc may have further details
>
> Sarbajit
>
> On 8/21/14, pavan nair <
pavannair1@gmail.com> wrote:
>> Thanks Sarbajit. The money could be used to retire government debt on
>> which
>> much higher rates are being paid. Does it make sense if you owe 80
>> billion
>> dollars (the approximate amount of the government debt besides NRI
>> deposits
>> of 100 billion dollars) and are paying about 6% interest, to deposit 73
>> billion dollars in US treasuries which yield less that 2% interest. The
>> NRI
>> deposit scheme needs to be revised and rates lowered as well as interest
>> taxed. If I as a resident Indian am being paid the same interest and
>> taxed,
>> I do not see why NRIs should not be taxed. In fact they should volunteer
>> to
>> pay tax since voting rights are also being given. Pavan Nair
>>
>>
>> On Thu, Aug 21, 2014 at 8:31 AM, Sarbajit Roy <
sroy.mb@gmail.com> wrote:
>>
>>> Dear Pavan
>>>
>>> I have no inputs on this. Since 2010 the IN Rupee has depreciated by
>>> 35% against major currencies. INR has been the worst performing major
>>> currency. RBI has probably prudently moved our FOREX reserves into the
>>> safest place it can find :-)
>>>
>>> NRI's being NRIs, GoI can probably refuse to pay them when the shit
>>> hits the fan.
>>>
>>> Sarbajit
>>>
>>> On 8/19/14, pavan nair <
pavannair1@gmail.com> wrote:
>>> > Dear Sarbajit,
>>> >
>>> > I came across a report in the Economic Times of today regarding
>>> > the
>>> > subject. Here is the link.
>>> >
>>> >
>>>
http://economictimes.indiatimes.com/news/economy/finance/india-among-top-16-lenders-to-us-as-bond-investments-hit-73-billion-in-june/articleshow/40382761.cms
>>> >
>>> > I find it inexplicable that we have been borrowing money from NRIs at
>>> rates
>>> > OF up to 9% per annum for NRO/NRE accounts and lending money to the US
>>> > government in the form of US treasuries at very low rates of about 2%.
>>> The
>>> > lending to the US has increased by 19% in the last financial year. The
>>> > external debt stands at 440.6 billion dollars as on 31 March 2014 and
>>> > has
>>> > risen substantially primarily on account of increased NRI investment
>>> which
>>> > stands at 103.8 billion dollars. The reserves are at about 320 billion
>>> > dollars which includes the NRI borrowing. This amounts to a loss of
>>> > taxpayer money since we need to buy dollars at existing market rates
>>> > to
>>> > payout the interest to NRIs. There seems to be an arrangement with the
>>> > US
>>> > government in return for something unknown, otherwise why should a
>>> > poor
>>> and
>>> > indebted country like India lend more to the US than developed
>>> > countries
>>> > like France, Canada and Germany. We need to retire debt so that debt
>>> > servicing which is at about 25 billion dollars per annum can be
>>> > reduced.
>>> > May I request you and through you, other members of the list for their
>>> > views as also what action can be taken. Has the Governor RBI got the
>>> > authority to invest or is it a Cabinet decision. Regards. Pavan Nair
