With small savings and government borrowing thrown in, banks will borrow at 8 per cent and more and lend at 4 per cent and less. Now we know why PSU banks can’t be privatised and why loss-making private banks must be nationalised.

The CPM is most honest in demanding the FRBM Act and fiscal restraint be scrapped. There is an African proverb, “When a poor man goes to the market, often he comes home with only tears,” a proverb likely to be quoted several times in present global environment. However, given our legacy of government intervention, the Indian version is — when a poor man goes to the state, or even to vote, often he comes home with only fears.

The writer is a Delhi-based economist

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