RBI Deputy Governor, Mr. Anand Sinha, enlightens students at Manthan'12 - Finance Summit held on 11th Feb'12

Manthan – 2012, The first edition of the finance summit of IIM Kashipur was held on Saturday, 11 February 2012. The event witnessed mix of eminent industry personalities from the feild of finance, academia and students on a platform to put forward their view on ‘Global financial crisis and impact on Indian businesses’.

Mr. Anand Sinha, Dy Governor, RBI delivered the keynote address. Dr. Devi Singh, mentoring director IIM Kashipur and Director IIM Lucknow and Mr. Saurabh Bhat, President and managing director, corporate finance, Yes Bank addressed the gathering. Veteran professionally from various banks such as Union Bank, State Bank, Yes Bank and IDBI Bank to name a few constituted the audience.

Opening the event, Dr. Devi Singh was enthusiastic about the event and appreciated the student’s keen thirst for knowledge and efforts towards organizing the event. Dr. Devi Singh opined upon the debt driven open ended growth strategy of the U.S. as having its own perils and one of the key causes of the financial crisis. He also mentioned that unless growth picks up, debt bonds are restructured and fiscal tightening is exercised, giving financial props will not go a long way towards mitigating the impacts of the financial crisis. For the students of the Institute looking forward to a career in finance, Dr. Singh underlined the significance of understanding the core economics behind the increasingly complex financial world.

Mr. Saurabh Bhat, in his address spoke richly on the impact of the global crisis on India’s Banking and SME sectors. Mr. Bhat mentioned the three channels of influence of the global crisis being the trade channel, the finance channel and the confidence channel. The impact of rupee volatility on SME’s was also iterated, which is specially magnified in the absence of liquidity and capital availability. “This is the right time for Indian industry to focus on renewable energy, since the prices of conventional fossil fuel based energy sources are going one way – up”, said Mr. Bhat.

Mr. Anand Sinha in his keynote address spoke extensively on the build up of the global crisis and its causes. “Artificially low interest rates and credit boom, aided by leverage and flawed credit risk transfer contributed to a lack of focus on systemic risk” said Mr. Sinha. Speaking directly to the students of finance, Mr Sinha mentioned the frailty of financial models and how they cannot incorporate the irrationality of human behaviour. 

“Confidence and perception are very important and form the basis of successful banking”, said Mr. Sinha. Mr. Sinha also provided a detailed and granular breakup of the financial crisis, its causes and impacts on India which proved to be a great value add for the students and guests from industry alike.

The keynote address was followed by corporate dinner with an electrifying level of interaction amongst the guests. Many students of the institute with entrepreneurial ambitions found priceless advice and words of wisdom from their interactions with the guests over dinner.

Many guests expressed their delight while attending the event, the first of its kind in the region, and affirmed their positive response and participation in such events organized by the institute going forward. 

Mr. Sinha's detailed speech given at IIM Kashipur was later published and can be found at http://www.bis.org/review/r120322b.pdf