Prime Minister Manmohan Singh on Wednesday said there is "no instant solution" to bring back black money stashed in foreign banks and that information with government cannot be made public due to treaty obligations.
"There is no instant solution to bring back what is called black money. We have got some information and that has been provided to us for use in the collection of due taxes," he told reporters at Rashtrapati Bhavan after a rejig of some portfolios and new inductions, the first such exercise in his second term in office.
His comments came close on the heels of the Supreme Court pulling up the government for withholding information on black money stashed in foreign banks, saying it is not just limited to tax evasion but a "mind boggling crime" amounting to "theft" and "plunder" of national wealth having security ramifications.
Noting that he was not aware of what the apex court has said, Singh said "we cannot use the information for any other purposes and that information cannot be made public" as the country cannot violate the obligations under international treaties.
The apex court's observation came while hearing a petition filed by noted criminal lawyer Ram Jethmalani , who along with some retired bureaucrats and police officers, approached it seeking directions to the government to take steps to bring black money to the tune of one trillion dollars stashed in foreign bank back to the country.
The Centre's contention before the court is that it was case of tax evasion and it cannot make public the names of Indian account holders.
Wednesday, January 19, 2011
Tuesday, January 18, 2011
REPO Rate
CRR
CRR or the Cash Reserve Ratio is the proportion of Bank’s reserves that they have to hold with the RBI. It is mandatory under law for the banks to hold such reserves with the central bank and the RBI is under law, empowered to stipulate this ratio. This amount of reserves that are held with the RBI is known as Required Reserves. It is a percentage of total demand and time liabilities of banks (demand – short term reserves, time – long term reserves).
IMPACT OF CHANGE IN CRR
To understand this, we have to understand the concept of Ordinary Money and High Powered Money.
Ordinary Money (M) is defined as the sum of Currency and Demand Deposits in banks held by public
So, M = C + DD
High Powered Money (H) is money produced by RBI and Government (coins), held by public and banks. It is also called Reserve Money. It is the sum of (i) Currency held by public and (ii) Cash Reserves of Banks.
So, H = C + R
So comparing the two equations, the difference is DD and R, currency being the common factor. This difference arises from the presence of banks as producers of demand deposits, to produce which they have to maintain R, which is a part of H, produced by only RBI and not banks.
So R is the total reserves with the banks. These are further divided into (i) Required Reserves and (ii) Excess Reserves. Required Reserves is explained above. All reserves in excess of Required Reserves are Excess Reserves, which banks are free to hold as “cash in hand”, which banks use to meet their currency drains (net withdrawal of currency by their depositors) and their clearing drains (net loss of cash due to cross-clearing of cheques between banks).
Now the control measure of CRR attempts to affect the stock of money via the impounding (restricting) or release of bank reserves. When the average CRR is revised upwards, banks are required to hold larger reserves or balances with the RBI than before for the same amount of total reserves. Since reserves are a part of H, this amounts to a virtual withdrawal of a part of H from the public equal to the amount of additional reserves impounded.
In the opposite scenario, when the CRR is lowered, this amounts to releasing the reserves so a virtual increase in H.
SLR
The chief role of SLR is to govern the allocation of total bank credit between the government and the commercial sector,. There are two ways in which it plays this role:
- By affecting the borrowings of the government from the RBI
- By affecting the freedom of the banks to sell government securities or borrow against them from the RBI
In both ways the creation of H is affected and thereby variations in the money supply
Under this statutory liquidity requirement, each bank is required statutorily to maintain a prescribed minimum proportion of its daily total demand and time liabilities in the form of designated liquid assets.
The liquid assets consist of
- Excess reserves
- Unencumbered government and other approved securities
- Current account balances with other banks
This SLR is defined as:
SLR = (ER + I + CB)/L
ER = Excess Reserves
I = Investment in unencumbered government and ‘other approved’ securities
CB = Current account balances with other banks
L = Total demand and time liabilities
- Excess reserves are defined as total reserves (Cash on hand plus balances with the RBI) minus statutory or required reserves with the RBI.
- Securities are unencumbered if loans have not been taken against them from the RBI
- Other approved securities are those that enjoy government’s guarantee in respect of payment of interest and principal. E.g. – bonds of IDBI, NABARD, development banks, co-operative debentures, debentures of state electricity boards, state road corporations, port trusts etc.
Bank Rate:
Bank rate is the rate of interest which RBI charges on the loans and advances that it extends to commercial banks and other financial intermediaries.
Repo Rate
Repo or Repurchase rate is the rate at which banks borrow funds from the RBI to meet the gap between the demand they are facing for money (loans) and how much they have on hand to lend.
Both bank rate and repo rate are interest rates at which commercial banks borrow from the RBI. The essential difference is that bank rate is what is used for what is called “clean borrowing” and this is generally for a bit longer-term. For instance, a commercial bank may simply borrow from RBI promising to pay 6% pa on the loan from RBI. This is akin to the normal personal loan that we get from banks except in this case the central bank is the lender.
Repo rate is basically the rate charged on this thing called a repo or “repurchase agreement”. Essentially, a repurchase agreement is an agreement between one party and another in which the former sells a security (like a bond) to the latter with a promise to buy it back after a particular period. For instance, a bank may enter into a repo with RBI, selling a security to RBI and then tell RBI that I will buy this security back from you after 3-months. RBI tells the bank…OK I will pay Rs. 100 for this security now but when you buy it back from me, please pay me Rs. 103. The extra Rs. 3 that RBI charges constitutes the repo rate (translates into 12% pa for this example) Hence, repos are a form of “collateralized or secured borrowings” in which the borrower must place collateral with the lender (in this case RBI). If the borrower does not manage to buy back the security, the lender can redeem its collateral value. Generally, repos are used for managing domestic liquidity in the economy. While a bank rate has a direct impact on borrowing costs for banks, repo rates have a more of a fine-tuning impact. Furthermore, repos are short-term agreements and are entered into by banks to meet short-term shortfalls in their liquidity positions. By raising the repo rate, RBI signals to the commercial banks that …. Hey look, I will still be willing to enter into repurchase agreements with you all but you better pay a higher interest to me. The banks understand this extra cost and cut back on lending to hold more cash or other liquid assets just in case they have liquidity issues as now it’s more expensive to get funding from RBI. Hence, repo rate has an impact on total Money supply and hence inflation.
Essentially, both rates are instruments of monetary policy. The idea is the same for both. They are merely different in how quickly they impact money supply or growth.
“Reverse Repo” rate is just what the name suggests. It’s the reverse of the repo. A reverse repurchase agreement or a ‘reverse repo’ is something like a switch between the buyer and the seller in a repurchase agreement. More specifically it’s a switch in the perspective.
For example in the case of reverse repo, the RBI would be the one selling the security to the commercial bank and telling it….if you give me Rs. 100 for 3 months today, I’ll pay you Rs. 3 as interest on it after 3 months and you give me back this security. So it is actually a ‘repo’ from RBI’s perspective but a ‘reverse’ repo from the commercial bank’s perspective. I hope you see the difference. The interest rate that RBI promises the commercial bank for placing its money with RBI is the reverse repo rate. By hiking the reverse repo rate, RBI can make it attractive for commercial banks to actually enter into reverse repo agreements with RBI thus reducing money supply.
By slashing it, it makes it less attractive for the commercial bank to enter into reverse repo agreement with it. It’s akin to our personal deposits in banks. If deposit rate is high, we’re more likely to keep it with the bank. A closer look-alike of reverse repo in our day to day lives would be a fixed deposit or Certificate of Deposit.
Call money rate is simply another name for ‘inter-bank borrowing’ rate. We need to realize that banks don’t just lend to corporate and individuals like us. They lend to one another. Call money rate generally refers to overnight borrowing and lending among banks. Not all banks are flush with cash all the time. So they have to ask one another for very short-term funding needs like for one a night or a few days. So they will get these funds by borrowing from one another. The lending bank will charge the borrowing bank an interest rate for even a single night (true businessmen, aren’t they?). Call rates are generally the average of all the rates that banks have charged each other overnight. Recently call rates had shot up and banks were charging one another rates as high as 22-24% pa just to lend for one day.
Prime Lending Rate: is a rate fixed by a particular bank which acts as a benchmark for various rates it will charge its customer’s on various loans.
Now a bank borrows funds from various sources and this borrowing has a cost. Now for example the average of this cost works out to be 6%. Now it gives funds to borrowers through many forms: personal loan, car loan, home loan, business loan, term loan etc. every kind of loan has its own risks and returns, some higher and some lower. The bank decides interest rate it will charge on these loans depending upon the risk involved in that particular type of loan. A home loan will be of lower risk so interest rate will be lower than say a personal loan which is riskier because the former is securitized by the purchased home but the latter gives no security to the bank. So these different interest rates will be benchmarked to the PLR, which acts as a guideline. So term loan will be say PLR + 3% and so on.
CRR or the Cash Reserve Ratio is the proportion of Bank’s reserves that they have to hold with the RBI. It is mandatory under law for the banks to hold such reserves with the central bank and the RBI is under law, empowered to stipulate this ratio. This amount of reserves that are held with the RBI is known as Required Reserves. It is a percentage of total demand and time liabilities of banks (demand – short term reserves, time – long term reserves).
IMPACT OF CHANGE IN CRR
To understand this, we have to understand the concept of Ordinary Money and High Powered Money.
Ordinary Money (M) is defined as the sum of Currency and Demand Deposits in banks held by public
So, M = C + DD
High Powered Money (H) is money produced by RBI and Government (coins), held by public and banks. It is also called Reserve Money. It is the sum of (i) Currency held by public and (ii) Cash Reserves of Banks.
So, H = C + R
So comparing the two equations, the difference is DD and R, currency being the common factor. This difference arises from the presence of banks as producers of demand deposits, to produce which they have to maintain R, which is a part of H, produced by only RBI and not banks.
So R is the total reserves with the banks. These are further divided into (i) Required Reserves and (ii) Excess Reserves. Required Reserves is explained above. All reserves in excess of Required Reserves are Excess Reserves, which banks are free to hold as “cash in hand”, which banks use to meet their currency drains (net withdrawal of currency by their depositors) and their clearing drains (net loss of cash due to cross-clearing of cheques between banks).
Now the control measure of CRR attempts to affect the stock of money via the impounding (restricting) or release of bank reserves. When the average CRR is revised upwards, banks are required to hold larger reserves or balances with the RBI than before for the same amount of total reserves. Since reserves are a part of H, this amounts to a virtual withdrawal of a part of H from the public equal to the amount of additional reserves impounded.
In the opposite scenario, when the CRR is lowered, this amounts to releasing the reserves so a virtual increase in H.
SLR
The chief role of SLR is to govern the allocation of total bank credit between the government and the commercial sector,. There are two ways in which it plays this role:
- By affecting the borrowings of the government from the RBI
- By affecting the freedom of the banks to sell government securities or borrow against them from the RBI
In both ways the creation of H is affected and thereby variations in the money supply
Under this statutory liquidity requirement, each bank is required statutorily to maintain a prescribed minimum proportion of its daily total demand and time liabilities in the form of designated liquid assets.
The liquid assets consist of
- Excess reserves
- Unencumbered government and other approved securities
- Current account balances with other banks
This SLR is defined as:
SLR = (ER + I + CB)/L
ER = Excess Reserves
I = Investment in unencumbered government and ‘other approved’ securities
CB = Current account balances with other banks
L = Total demand and time liabilities
- Excess reserves are defined as total reserves (Cash on hand plus balances with the RBI) minus statutory or required reserves with the RBI.
- Securities are unencumbered if loans have not been taken against them from the RBI
- Other approved securities are those that enjoy government’s guarantee in respect of payment of interest and principal. E.g. – bonds of IDBI, NABARD, development banks, co-operative debentures, debentures of state electricity boards, state road corporations, port trusts etc.
Bank Rate:
Bank rate is the rate of interest which RBI charges on the loans and advances that it extends to commercial banks and other financial intermediaries.
Repo Rate
Repo or Repurchase rate is the rate at which banks borrow funds from the RBI to meet the gap between the demand they are facing for money (loans) and how much they have on hand to lend.
Both bank rate and repo rate are interest rates at which commercial banks borrow from the RBI. The essential difference is that bank rate is what is used for what is called “clean borrowing” and this is generally for a bit longer-term. For instance, a commercial bank may simply borrow from RBI promising to pay 6% pa on the loan from RBI. This is akin to the normal personal loan that we get from banks except in this case the central bank is the lender.
Repo rate is basically the rate charged on this thing called a repo or “repurchase agreement”. Essentially, a repurchase agreement is an agreement between one party and another in which the former sells a security (like a bond) to the latter with a promise to buy it back after a particular period. For instance, a bank may enter into a repo with RBI, selling a security to RBI and then tell RBI that I will buy this security back from you after 3-months. RBI tells the bank…OK I will pay Rs. 100 for this security now but when you buy it back from me, please pay me Rs. 103. The extra Rs. 3 that RBI charges constitutes the repo rate (translates into 12% pa for this example) Hence, repos are a form of “collateralized or secured borrowings” in which the borrower must place collateral with the lender (in this case RBI). If the borrower does not manage to buy back the security, the lender can redeem its collateral value. Generally, repos are used for managing domestic liquidity in the economy. While a bank rate has a direct impact on borrowing costs for banks, repo rates have a more of a fine-tuning impact. Furthermore, repos are short-term agreements and are entered into by banks to meet short-term shortfalls in their liquidity positions. By raising the repo rate, RBI signals to the commercial banks that …. Hey look, I will still be willing to enter into repurchase agreements with you all but you better pay a higher interest to me. The banks understand this extra cost and cut back on lending to hold more cash or other liquid assets just in case they have liquidity issues as now it’s more expensive to get funding from RBI. Hence, repo rate has an impact on total Money supply and hence inflation.
Essentially, both rates are instruments of monetary policy. The idea is the same for both. They are merely different in how quickly they impact money supply or growth.
“Reverse Repo” rate is just what the name suggests. It’s the reverse of the repo. A reverse repurchase agreement or a ‘reverse repo’ is something like a switch between the buyer and the seller in a repurchase agreement. More specifically it’s a switch in the perspective.
For example in the case of reverse repo, the RBI would be the one selling the security to the commercial bank and telling it….if you give me Rs. 100 for 3 months today, I’ll pay you Rs. 3 as interest on it after 3 months and you give me back this security. So it is actually a ‘repo’ from RBI’s perspective but a ‘reverse’ repo from the commercial bank’s perspective. I hope you see the difference. The interest rate that RBI promises the commercial bank for placing its money with RBI is the reverse repo rate. By hiking the reverse repo rate, RBI can make it attractive for commercial banks to actually enter into reverse repo agreements with RBI thus reducing money supply.
By slashing it, it makes it less attractive for the commercial bank to enter into reverse repo agreement with it. It’s akin to our personal deposits in banks. If deposit rate is high, we’re more likely to keep it with the bank. A closer look-alike of reverse repo in our day to day lives would be a fixed deposit or Certificate of Deposit.
Call money rate is simply another name for ‘inter-bank borrowing’ rate. We need to realize that banks don’t just lend to corporate and individuals like us. They lend to one another. Call money rate generally refers to overnight borrowing and lending among banks. Not all banks are flush with cash all the time. So they have to ask one another for very short-term funding needs like for one a night or a few days. So they will get these funds by borrowing from one another. The lending bank will charge the borrowing bank an interest rate for even a single night (true businessmen, aren’t they?). Call rates are generally the average of all the rates that banks have charged each other overnight. Recently call rates had shot up and banks were charging one another rates as high as 22-24% pa just to lend for one day.
Prime Lending Rate: is a rate fixed by a particular bank which acts as a benchmark for various rates it will charge its customer’s on various loans.
Now a bank borrows funds from various sources and this borrowing has a cost. Now for example the average of this cost works out to be 6%. Now it gives funds to borrowers through many forms: personal loan, car loan, home loan, business loan, term loan etc. every kind of loan has its own risks and returns, some higher and some lower. The bank decides interest rate it will charge on these loans depending upon the risk involved in that particular type of loan. A home loan will be of lower risk so interest rate will be lower than say a personal loan which is riskier because the former is securitized by the purchased home but the latter gives no security to the bank. So these different interest rates will be benchmarked to the PLR, which acts as a guideline. So term loan will be say PLR + 3% and so on.
Thursday, December 30, 2010
Citibank Fraud
GURGAON: Shivraj Puri , the alleged mastermind behind Rs 300 crore Citibank fraud in the branch here, was today remanded in 7 days' police custody.
Duty Magistrate Raj Kumar Yadav has sent Citibank fraud accused to 7 days police custody, Gurgaon Police Commissioner S S Deswal said.
Talking to Times of India after his arrest, Puri said: "I have already given full details to the police. I have full faith in the judiciary. Truth will come out."
After his arrest this morning, Puri, the Relationship Manager of Citibank, Gurgaon branch, was produced before a special court as other courts are on winter vacation.
During the interrogation the police would trace the money trail which were fraudulently collected from High Networth Individuals (HNIs) by promising unusually high returns of 18 per cent, Deswal said.
Deswal said of the Rs 300 crore estimated to be involved in the fraud Rs 200 crore belong to corporates and Rs 100 crore to individuals.
He said 40 teams have been constituted to crack the case that involved alleged siphoning off funds taken as investments from high networth individuals into a personal account of the main suspect Puri and three of his accomplices.
Deswal said Puri's father Raghuraj Puri is said to be owning a brokerage firm Norway Martin through which diverted funds were invested in the stock market.
Asked whether the Gurgaon police will seek the help of other agencies in the probe, he said "we are qualified and competent to investigate. In case it is needed, we will consider it."
He said the Citibank has already informed RBI and SEBI about the fraud.
The Commissioner said from the interrogation of Puri police hoped to get more clues.
Puri, who worked at the bank's Gurgaon branch as a relationship manager, is accused of siphoning money from 20 accounts of high net worth individuals. Puri, allegedly cheated investors by promising to double their money. Since the task of opening new accounts had been assigned to him, he managed to dupe many people without the bank's knowledge.
A case of cheating and forgery was registered against Puri and the others DLF Phase-II Police Station on Monday night after Citibank lodged a formal complaint.
Duty Magistrate Raj Kumar Yadav has sent Citibank fraud accused to 7 days police custody, Gurgaon Police Commissioner S S Deswal said.
Talking to Times of India after his arrest, Puri said: "I have already given full details to the police. I have full faith in the judiciary. Truth will come out."
After his arrest this morning, Puri, the Relationship Manager of Citibank, Gurgaon branch, was produced before a special court as other courts are on winter vacation.
During the interrogation the police would trace the money trail which were fraudulently collected from High Networth Individuals (HNIs) by promising unusually high returns of 18 per cent, Deswal said.
Deswal said of the Rs 300 crore estimated to be involved in the fraud Rs 200 crore belong to corporates and Rs 100 crore to individuals.
He said 40 teams have been constituted to crack the case that involved alleged siphoning off funds taken as investments from high networth individuals into a personal account of the main suspect Puri and three of his accomplices.
Deswal said Puri's father Raghuraj Puri is said to be owning a brokerage firm Norway Martin through which diverted funds were invested in the stock market.
Asked whether the Gurgaon police will seek the help of other agencies in the probe, he said "we are qualified and competent to investigate. In case it is needed, we will consider it."
He said the Citibank has already informed RBI and SEBI about the fraud.
The Commissioner said from the interrogation of Puri police hoped to get more clues.
Puri, who worked at the bank's Gurgaon branch as a relationship manager, is accused of siphoning money from 20 accounts of high net worth individuals. Puri, allegedly cheated investors by promising to double their money. Since the task of opening new accounts had been assigned to him, he managed to dupe many people without the bank's knowledge.
A case of cheating and forgery was registered against Puri and the others DLF Phase-II Police Station on Monday night after Citibank lodged a formal complaint.
Wednesday, September 1, 2010
Govt went wrong in calculating one of the GDP figures: Mospi
Facing embarrassment after throwing forward sharply different economic growth figures based on two different methodologies, the government will soon set the record straight on the pace of economic expansion.
According to the government data, the economy grew by 8.8 per cent in the April-June quarter based on actual expansion without accounting for taxes - a methodology known as factor cost.
At the same time, the data released by the Ministry of Statistics and Programme Implementation (Mospi) showed growth at market price, which reflects the value of the production or services that includes indirect taxes, at just 3.65 per cent.
"There were some problems in calculating GDP at market prices at constant prices, and we will come out with a corrigendum soon," an official with Ministry of Statistics and Programme Implementation (Mospi) told PTI.
Central Statistical Organisation (CSO) that releases the data is part of Mospi.
The wide difference in GDP growth numbers under the two methodologies created confusion among economists.
Experts said GDP at market price should not have been so low, since indirect taxes--excise duty--rose by two per cent this fiscal, after the government partially withdrew stimulus measures.
The mistake was in calculating a price deflator, which is used for converting nominal GDP into real GDP, explained the official.
Real GDP does not include inflation and hence considered a better indicator of an economy. Also, when economic growth rate is defined, real GDP is used, rather than nominal GDP.
According to the government data, the economy grew by 8.8 per cent in the April-June quarter based on actual expansion without accounting for taxes - a methodology known as factor cost.
At the same time, the data released by the Ministry of Statistics and Programme Implementation (Mospi) showed growth at market price, which reflects the value of the production or services that includes indirect taxes, at just 3.65 per cent.
"There were some problems in calculating GDP at market prices at constant prices, and we will come out with a corrigendum soon," an official with Ministry of Statistics and Programme Implementation (Mospi) told PTI.
Central Statistical Organisation (CSO) that releases the data is part of Mospi.
The wide difference in GDP growth numbers under the two methodologies created confusion among economists.
Experts said GDP at market price should not have been so low, since indirect taxes--excise duty--rose by two per cent this fiscal, after the government partially withdrew stimulus measures.
The mistake was in calculating a price deflator, which is used for converting nominal GDP into real GDP, explained the official.
Real GDP does not include inflation and hence considered a better indicator of an economy. Also, when economic growth rate is defined, real GDP is used, rather than nominal GDP.
Sunday, July 25, 2010
Looking back at Jhunjhunwala's good, bad and silly stocks
There isn't any tell-tale sign of this ace investor turning 50. In a free-wheeling interview with CNBC-TV18's managing editor Udayan Mukherjee, Rakesh Jhunjhunwala admits that "age" hasn't mellowed him down nor has it stopped him from being a ladies' man. This man with Midas touch non-chalantly says he finds Sushmita Sen hot.
Of course, this Warren Buffet of India's mind is dominated by stocks and their performance. While there are several stocks with which Jhunjhunwala is emotionally attached to, there are still some which generate a reasonable degree of annoyance. After over two decades of trading, Jhunjhunwala looks back at the changing face of his portfolio.
Rakesh Jhunjhunwala
Below is a verbatim transcript of the interview.
Mukherjee: A belated Happy Birthday.
Jhunjhunwala: Thank you.
Wish Rakesh Jhunjhunwala on his 50th birthday
Mukherjee: How does it feel to be 50?
Jhunjhunwala: My nephew told me that 40 is the old age of youth and 50 is the youth of old age. It feels to be youthful. I think it makes you reflect, otherwise it makes no difference. Same day passes by, same routine, same activity.
Mukherjee: You feel old?
Jhunjhunwala: I don’t feel old but if feel reflective. Whatever I did on this birthday and whatever thoughts I had in the interaction I had with people, it left a deep impression on my mind and it has made me reflect. It has given me a feeling that there is not much left ahead. It is 10-15-20-25, I think beyond 65 years all age is bonus. So there is less time to do all that has to be done.
Mukherjee: We will talk about the reflective part; first tell us what happened in Mauritius? Or is it that what happens in Mauritius stays in Mauritius like Dubai?
Jhunjhunwala: Basically we partied, we did some water sports, did lot of spa. We had carnival on the beach. We played Volleyball on the beach, table tennis, football. Then we had a rain dance, and then we had a Karaoke night, it was great fun. People really had a ball and the biggest gift I got on my birthday, the joy I had was seeing the joy others were having.
Mukherjee: Terrific, maybe next time I will make it for your sixtieth.Has age mellowed you? I know you have a feisty temper, has all of that calmed down with age?
Jhunjhunwala: I don't think so age is mellowing me. Let me admit it's humbling me. Time is teaching me slowly but surely that I can always be wrong. It also makes you realize that how small you are in the larger scheme of things
Jhunjhunwala: Well not necessarily but I would say more resent, less I would say impulsive. See Udayan what I feel is, may be it amounts to boasting, that it is giving polish to my best qualities, right? Age and experience is polishing my best qualities and it is mellowing the worst.
Mukherjee: What to your mind are your best and worst qualities?
Jhunjhunwala: I think my worst qualities are my personal habits, my anger.
Mukherjee: You do concede that you have a temper?
Jhunjhunwala: I do, I have a temper. And means nothing, in the end I realize that if I ever In 22 years of marriage I must have shouted at Rekha [wife] at least 2200 times and Rekha would have shouted back only 2 times.
Mukherjee: Have you regretted all those times?
Jhunjhunwala: I always, I regret them and I go to the, while in the car I call her up and apologies, unless I do that I don’t feel comfortable.
Rekha Jhunjhunwala: He is the same person what I knew him last 23 years. He always used to ask me like do you love me, you love me, so now I can tell him yes I love him. I love him what he was, what he is, he is a perfect husband.
Jhunjhunwala: There is a very good side to it but there is also blurring side to it, that’s what has cost me to miss, miss some of the greater joy’s of life. Miss that I wished I had spent far more time with my farther and I can never do that again. So I think those are the good qualities I think is, first I think the best quality I have, I am good to heart. What is in my heart is on my face and what is in my mouth is my heart. I think that endures me, I am frank, I think I am a good assessor of situations.
Of course, this Warren Buffet of India's mind is dominated by stocks and their performance. While there are several stocks with which Jhunjhunwala is emotionally attached to, there are still some which generate a reasonable degree of annoyance. After over two decades of trading, Jhunjhunwala looks back at the changing face of his portfolio.
Rakesh Jhunjhunwala
Below is a verbatim transcript of the interview.
Mukherjee: A belated Happy Birthday.
Jhunjhunwala: Thank you.
Wish Rakesh Jhunjhunwala on his 50th birthday
Mukherjee: How does it feel to be 50?
Jhunjhunwala: My nephew told me that 40 is the old age of youth and 50 is the youth of old age. It feels to be youthful. I think it makes you reflect, otherwise it makes no difference. Same day passes by, same routine, same activity.
Mukherjee: You feel old?
Jhunjhunwala: I don’t feel old but if feel reflective. Whatever I did on this birthday and whatever thoughts I had in the interaction I had with people, it left a deep impression on my mind and it has made me reflect. It has given me a feeling that there is not much left ahead. It is 10-15-20-25, I think beyond 65 years all age is bonus. So there is less time to do all that has to be done.
Mukherjee: We will talk about the reflective part; first tell us what happened in Mauritius? Or is it that what happens in Mauritius stays in Mauritius like Dubai?
Jhunjhunwala: Basically we partied, we did some water sports, did lot of spa. We had carnival on the beach. We played Volleyball on the beach, table tennis, football. Then we had a rain dance, and then we had a Karaoke night, it was great fun. People really had a ball and the biggest gift I got on my birthday, the joy I had was seeing the joy others were having.
Mukherjee: Terrific, maybe next time I will make it for your sixtieth.Has age mellowed you? I know you have a feisty temper, has all of that calmed down with age?
Jhunjhunwala: I don't think so age is mellowing me. Let me admit it's humbling me. Time is teaching me slowly but surely that I can always be wrong. It also makes you realize that how small you are in the larger scheme of things
Jhunjhunwala: Well not necessarily but I would say more resent, less I would say impulsive. See Udayan what I feel is, may be it amounts to boasting, that it is giving polish to my best qualities, right? Age and experience is polishing my best qualities and it is mellowing the worst.
Mukherjee: What to your mind are your best and worst qualities?
Jhunjhunwala: I think my worst qualities are my personal habits, my anger.
Mukherjee: You do concede that you have a temper?
Jhunjhunwala: I do, I have a temper. And means nothing, in the end I realize that if I ever In 22 years of marriage I must have shouted at Rekha [wife] at least 2200 times and Rekha would have shouted back only 2 times.
Mukherjee: Have you regretted all those times?
Jhunjhunwala: I always, I regret them and I go to the, while in the car I call her up and apologies, unless I do that I don’t feel comfortable.
Rekha Jhunjhunwala: He is the same person what I knew him last 23 years. He always used to ask me like do you love me, you love me, so now I can tell him yes I love him. I love him what he was, what he is, he is a perfect husband.
Jhunjhunwala: There is a very good side to it but there is also blurring side to it, that’s what has cost me to miss, miss some of the greater joy’s of life. Miss that I wished I had spent far more time with my farther and I can never do that again. So I think those are the good qualities I think is, first I think the best quality I have, I am good to heart. What is in my heart is on my face and what is in my mouth is my heart. I think that endures me, I am frank, I think I am a good assessor of situations.
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