COVER

CONSUMER FINANCE

Oct 27 - Nov 02, 2003  
ISSUE # 43  

The consumer finance business is growing but it has not attained the desired level. There are a number of impediments responsible for the slow growth. While higher interest rate is a major problem, the inadequate legal cover available to the lenders is a more contentious issue. If the banks are shy to venture into consumer finance, then setting up specialized companies to undertake consumer finance may be a solution. However, not major breakthrough can be achieved without the active participation of central bank.

 

 

 

COTTON CRISIS
Cotton prices touching a record high at Rs3500 per maund last week created a hue and cry among the textile sector demanding for putting a ban on cotton export and permission to import cheaper cotton from Central Asian States and India. Although the abnormal increase in cotton prices was being attributed to the shortfall in current cotton crop by 1 million bales, yet active players in cotton trade were of the view that the real cause for increase were international cotton prices shooting up to 82 cents. The international market prices were on the high side because of considerable decline in cotton crop in the major cotton producing countries like China, US and India.

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AUTO INDUSTRY
No body can blame the Ministry of Industries and Production's Task Force on the auto industry for inflexibility. It took the Task Force months of deliberations, and tons of unsolicited advice that seemingly fell on deaf ears, to finally give local car producers three months to clean up their act or be ready to face competition from new cars allowed to be imported at half the duties.