Pulak Mishra

Structure, Conduct and Performance of Indian Banking Sector

Abstract In the context of initiation of economic reforms in general and changes in policies and regulations of the banking sector in particular, the present paper attempts to examine the structure-conduct-performance relationships in Indian banking sector. It is observed that there have been changes in the market structure of Indian banking sector, conducts of the banks and their performance in the post-reform era, especially during the last decade, though the changes have not been significant in every aspect. Using a panel dataset of 59 banks operating in India during 1999-2000 to 2008-2009 and applying the two-stage least squares (2SLS) method of estimation, the paper finds that there exist strong inter-linkages amongst structure of the market, banks’ conduct and their financial performance. While market share of a bank depends directly on its market size, asset base, selling efforts, and past financial performance, its selling efforts vary directly with market share, asset base, and past financial performance. On the other hand, returns on assets of a bank vary directly with its market share, but inversely with its asset base and selling efforts. The regression results essentially suggest for multidirectional and dynamic SCP relationships in Indian banking sector. It is also found that the nature of ownership has significant influence on market share, selling efforts and financial performance of the banks. As compared to the nationalised banks, market share of the private banks (both domestic and foreign) is found to be lower. But private banks make greater selling efforts and have better financial performance vis-à-vis their public sector counterparts

A Development Delivery Institution for the Tribal Communities: Experience of the National Rural Employment Guarantee Scheme in India

This article examines the varied impacts of the National Rural Employment Guarantee Scheme (NREGS) as a development delivery institution for the tribal communities vis-a-vis other social groups across the Indian States, using the framework of new institutional economics. A number of State-specific, socio-economic institutional factors seem to be responsible for these variations. The article therefore suggests institutional reforms and convergence of the development initiatives of the Ministry of Tribal Affairs with the NREGS in order to realise the optimal potential of the scheme, and, in particular, to ensure greater livelihood opportunities for these marginalised groups and their entitlement to productive resources with greater socio-economic and political empowerment.

R&D Efforts by Indian Pharmaceutical Firms in the New Patent Regime

R&D Efforts by Indian Pharmaceutical Firms in the New Patent Regime In the context of recent amendments to the Indian Patent Act and introduction of the product patent, the present paper attempts to examine the innovative efforts of Indian pharmaceutical companies in the new patent regime. The paper finds that although R&D expenditure has increased significantly in the current decade, the increasing R&D efforts are not widespread across the firms and more than half of the Indian pharmaceutical companies do not spend at all on in-house R&D. This means that protection of intellectual property alone is not enough to encourage the firms towards innovation. Instead, it is observed that R&D expenditure varies directly the with market size of the firms, their capital intensity, exports orientation and past profitability, but inversely with their market share, selling efforts and import intensity. However, a firms involvement in mergers and acquisition or sourcing of technology from foreign sources or variability in financial performance does not have any significant impact on its R&D efforts. Hence, the policy measures should be directed towards restricting the monopoly power of firms, encouraging exports, liberalizing imports of necessary machinery and equipment, and motivating the firms towards innovation, especially in life-saving drugs, an through appropriate incentive/disincentive structure.

Modelling impacts of chemical fertilizer on agricultural production: a case study on Hooghly district, West Bengal, India

In the context of changing farming practices, particularly with increasing use of chemical fertilizers, the present paper attempts to statistically model the implications of such input intensification for growth of agricultural production and yield and crop diversification in Hooghly district of the Indian state of West Bengal. Understanding the issue is very important for sustainable growth of the sector in the long-run. The paper uses secondary data collected from the Bureau of Applied Economics and Statistics of the Government of West Bengal for the period 1989–2010. The paper shows that greater use of chemical fertilizers has no strong correlation with growth of agricultural production and yield. It is also found that agricultural production has fluctuated during this period possibly due to improper use of N–P–K over the years exceeding the assimilative capacity of soil. Further, excessive use of chemical fertilizers has also resulted in over extraction of ground water in the area. It is, therefore, suggested that efforts should be made towards deeper understanding of inherent potentials as well as limitations of soil and designing the farming strategies accordingly. In addition, formation of farming groups and promotion of organic farming should be explored to facilitate sustainable growth of the sector. Decentralized participatory planning can play a crucial role in this regard.

Democratic Local Institutions for Sustainable Management and Use of Minor Irrigation Systems: Experience of Pani Panchayats in Odisha, India

Generally, public investments in irrigation projects fail to deliver the desired outcomes largely due to inefficient management and use of the assets by the local level institutions. Against this backdrop, the present paper attempts to understand how the Pani Panchayats have performed in sustainable management and use of minor irrigation structures in the Indian state of Odisha. Using primary data and information collected from selected state-funded minor irrigation projects implemented in Cuttack district of the state, the paper finds that the Pani Panchayats, being backed by The Orissa Pani Panchayat Act (2002) and following a democratic decision making process, have been successful in managing the irrigation projects efficiently, especially in respect of pricing and distribution of irrigation water, maintenance of the systems, and their expansion, leading to socially inclusive and sustainable agricultural intensification in the area.

Asset Creation Under MGNREGA and Sustainable Agriculture Growth: Impacts of Convergence Initiatives in Odisha and West Bengal

In 2009, the Government of India announced a new set of guidelines for planning of works and preparation of labour budget under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA). This guideline made it mandatory for the states to ensure that at least 60% of MGNREGA related works undertaken in a district in terms of costs, is spent for creation of productive assets that are directly linked to agriculture and allied activities. This is very important considering that creation of productive assets is necessary not only for making ecological regeneration but also for ensuring sustainable growth of agriculture sector and creation of livelihood opportunities in a village economy. In this chapter, the authors analyze and document experience towards convergence of the MGNREGA work with other rural developmental schemes in the Odisha and West Bengal states of India. More specifically, the Chapter addresses the following issues: What are the different types of convergence models that have been initiated in Odisha and West Bengal? How have the joint efforts of various line departments contributed to conservation and management of natural resources? Are assets created under convergence initiatives sustainable in the long-run? How have these assets contributed to agriculture sector, particularly in respect of increase in production and yield, changes in cropping pattern, crop diversification, and multiple cropping? Can the existing institutions contribute to management and utilization of the assets created under convergence? If not, what institutional supports are necessary in this regard?

Impact of Mergers and Acquisitions on Firms’ Export Competitiveness: Experience of Indian Pharmaceutical Industry

This article attempts to examine the impact of mergers and acquisitions (M&A) on export competitiveness of firms in Indian pharmaceutical industry. It finds that the wave of M&A has positive influence on both incidence and extent of export competitiveness. In addition, incidence of exports is positively influenced by market share and efforts towards creating marketing and distribution related complementary assets as well. On the other hand, the extent of export intensity is also higher for firms with larger market share, greater marketing and distribution-related efforts, innovation and foreign technology purchase. However, advertising and financial performance do not cause any significant impact on export competitiveness. It is, therefore, suggested that policies and regulations relating to M&A, innovation and sourcing foreign technology need a fresh look with greater industry-specific flexibilities. There is also a need for integration of different policies and regulations in areas like FDI, intellectual property, and so on.