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Banking and Bank Finance

By: Varaha Karthik Pattisapu

Business requires two qualities- an aptitude for it and the feeling of confidence and
security arising from the co-operation from the government, economic stability and
diverse facilities of banking system as and when required.
Following are few suggestions or comments I could come up with:
Comments on Start-up regime framework:
In India the graduates are coming from a different culture than the foreign
countries. The goals conceived by them are to somehow get a god job so that he
can settle in life rather than take the risk of entrepreneurship. Also the economic
situation is far different from foreign nationals. So it is not a wise thing to compare
and thus equalizing the Indian setting and foreign setting. Rather with whatever is
in hand one should devise the policies in such a way that can bring potential
entrepreneur out and march towards gradual economic development. This is the
duty of the government to bring out friendly policies and effective governance.
This attracts the mind of young and potential businessmen. Also by making people
aware of the initiatives, policies of the government more and more people can opt
for business as an alternate way of living.

Criticisms on enabling frameworks:
The private sectors involvement in policy making, the implementation of
partnership programs and feedback mechanisms enables the SMEs to grow
significantly because they can dynamically interact with the government,
express their difficulties and also seek for support from large scale industries
who are more experienced. This instills the feeling of security in the minds
of the SMEs. But a note has to be taken that the purpose of this is growth of
the SMEs and not to exploit them by the influence of the government (as in
the case of corruption) or by the large scale industries.
The strategies in the financial regime framework are apt for the growth of
the SMEs. They deal with situations by which it can safely grow as well as
situations in which the SMEs are going bankrupt.

While it is essential to support the large scale industries in terms of supply of
resources it may also lead to monopoly of such industries. This might result
that the resources which can be used by medium and small scale industries
be diverted to large scale industries for their ever increasing profits. The
situation of rich becoming richer occurs. Instead resource allocation can be
done on a much fair basis for long-term development. This can be regulated
by the government by giving special focus to ambitious MSMEs. The word
ambitious signifies a genuine and an honest endeavor of growth of business
by taking the help from the government (say in the form of subsidies). To
enact this the government can grant subsidies on the basis of excellence of
project reports. Then the entrepreneur is required to give detailed progress of
the project periodically. This ensures transparency and simultaneously help
from the government is present.