JAIIB Past Paper PDF - Indian Economy & Indian Financial System

www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 1 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / C...

www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 1 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… ALL THE VERY BEST FOR YOUR EXAMS SHORT NOTES FOR JAIIB INDIAN ECONOMY & INDIAN FINANCIAL SYSTEM Though we had taken enough care to go through the notes provided here, we shall not be responsible for any loss or damage, resulting from any action taken on the basis of the contents. Creation of these short notes is the efforts of so many persons. First of all we thank all of them for their valuable contribution. We request everyone to go through the Macmillan book and update yourself with the latest information through RBI website and other authenticated sources. In case you find any incorrect/doubtful information, kindly update us also (along with the source link/reference for the correct information). Dr. K Murugan, DMS, MBA (Finance), MBA (HR), MCA, MSc (IT), CAIIB ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 2 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… Indian Economy & Indian Financial System Index S No Topic Page No 1 JAIIB & DBF – General Information 3 2 Syllabus 5 3 Module A – Indian Economic Architecture 13 4 Module B – Economic concepts related to Banking 41 5 Module C – Indian Financial Architecture 57 6 Module D – Financial Products And Services 91 ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 3 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… JAIIB / DBF – GENERAL INFORMATION  Consists of 4 papers : 1. Indian Economy & Indian Financial System 2. Principles & Practices of Banking 3. Accounting & Financial Management for Bankers 4. Retail Banking & Wealth Management  Only existing employees of banks can appear for JAIIB Exam.  People other than Bank Employees can appear for Diploma in Banking and Finance Exam. If Passed, JAIIB Examination certificate will be issued after joining the bank.  Syllabus & exam pattern for both JAIIB and DBF exams are mostly same.  Both JAIIB and DBF exams are conducted in on-line mode only.  The examination will be conducted normally twice a year in May / June and November / December on Saturdays/Sundays.  The duration of the examination will be of 2 hours.  Examination Pattern : Each Paper will contain 100 objective type MCQs, carrying 100 marks including questions based on case studies. The Institute may, however, vary the number of questions to be asked for a subject. There is no negative marking for wrong answers.  Passing Criteria - Minimum 200 in total and minimum 45 in each subject in any single attempt (not required to be the 1st attempt) is considered as pass. Else 50 in each subject. Passed subject gets carried forward to 5 attempts or 3 years (whichever is earlier) from the 1st attempt. If not passed in 5 attempts or 3 years, you need to appear in all the 4 papers.  First Class : 60% or more marks in aggregate and pass in all the subjects in the FIRST PHYSICAL ATTEMPT.  First Class with Distinction : 70% or more marks in aggregate and 60% or more marks in each subject in the FIRST PHYSICAL ATTEMPT.  Candidates who have been granted exemption in the subject/s will be given "Pass Class" only.  Cut-off Date of Guidelines /Important Developments for Examinations - The Institute has a practice of asking some questions in each exam about the recent developments/ guidelines issued by the regulator(s) in order to test if the candidates keep themselves abreast of the current developments. But, there could be changes in the developments / guidelines from the date the question papers are prepared and the dates of the actual examinations. In order to address these issues effectively, it has been decided that: ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 4 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 …………………………………………………………………………………………………………………………………………………………………  In respect of the exams to be conducted by the Institute for the Period from February to July of a calendar year, instructions/guidelines issued by the regulator(s) and important developments in banking and finance up to 31st December will only be considered for the purpose of inclusion in the question papers.  In respect of the exams to be conducted by the Institute for the period from August to January of a calendar year, instructions/guidelines issued by the regulator(s) and important developments in banking and finance up to 30th June will only be considered for the purpose of inclusion in the question papers.  Exam Fees JAIIB  First attempt fee Rs. 4,000/-*  2nd attempt fee Rs. 1,300/-*  3rd attempt fee Rs. 1,300/-*  4th attempt fee Rs. 1,300/-*  5th attempt fee Rs. 1,300/-* CAIIB  First attempt fee Rs. 5,000/-*  2nd attempt fee Rs. 1,300/-*  3rd attempt fee Rs. 1,300/-*  4th attempt fee Rs. 1,300/-*  5th attempt fee Rs. 1,300/-* DBF  First attempt fee Rs. 3,500/-*  2nd attempt fee Rs. 1,300/-*  3rd attempt fee Rs. 1,300/-*  4th attempt fee Rs. 1,300/-*  5th attempt fee Rs. 1,300/-* * Plus convenience charges and Taxes as applicable Please Note: Candidates are required to register for every attempt separately ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 5 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… SYLLABUS The details of the prescribed syllabus which is indicative are furnished below. However, keeping in view the professional nature of examinations, all matters falling within the realm of the subject concerned will have to be studied by the candidate as questions can be asked on all relevant matters under the subject. Candidates should particularly prepare themselves for answering questions that may be asked on the latest developments taking place under the various subject/s although those topics may not have been specifically included in the syllabus. Any alterations made will be notified from time to time. Further, questions based on current developments in banking and finance may be asked. Candidates are advised to refer to financial news papers / periodicals more particularly “IIBF VISION” and “BANK QUEST” published by IIBF. MODULE A: INDIAN ECONOMIC ARCHITECTURE An overview of Indian economy Evolution of Indian Economy, Basic Characteristics of Indian Economy, Indian Economy in Pre- British period, Economy till 2008 & after 2008, Structural changes in Indian Economy Economic Planning in India Definition of Economic Planning, History of Economic Planning, Objectives of Economic Planning, Types of Planning, Achievements of Planning, Financial resources for 5-year plans Sectors of Indian Economy Role & Importance of Primary, Secondary, Tertiary Sector, Quaternary & Quinary Sectors, Different Revolutions in Primary sector, Difference between the sectors, GDP contribution of different sectors, Agriculture, Industry, Services, Employment growth rate in Secondary sector, Sunrise Sector of Indian Economy, Organised and Unorganised sectors Role of Priority Sector and MSME in the Indian Economy Definition & Role of Priority Sector, List of Priority Sectors identified in India, Priority Sector Lending Norms, Definition of MSME, Role & Significance of MSME in economic development, Contribution of MSME in GDP, Recent Initiatives in MSME sector viz,, Atmanirbhar Bharat package, Make in India, Start-up India, Stand-up India etc. ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 6 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… Infrastructure including Social Infrastructure Infrastructure & Economic Development, Energy, Power, Transport system viz., Rail, Road, Civil Aviation, Concept of Social Sector & Social Infrastructure, Health, Education, Family welfare, Development of Health Infrastructure Globalisation - Impact on India Globalisation and its Advocacy, Globalisation and its Impact on India, Fair Globalisation & the Need for Policy framework, Globalisation in reverse gear - The Threatened Re-emergence of Protectionism Economic Reforms A brief overview, Transformation, Economic Transformation — Real Sector, Economic Transformation — Financial Sector, Economic Transformation — Integration with the Global Economy, Economic Reforms in India Foreign Trade Policy, Foreign Investments and Economic Development FTP—Structural Changes during 1990s, FTP policy — 2015-2020, Challenges to be addressed in upcoming FTP, FDIs, FIIs and Recent trends, Economic development vs economic growth, Importance of economic development as a dimension etc. International Economic Organisations (World Bank, IMF etc.) IMF and World Bank, World Trade Organization (WTO) — India and WTO, Regional Economic Co-operations, Recent International Economic Issues Climate change, Sustainable Development Goals (SDGs) Core elements of Sustainable Development, Global Issues and initiatives, India's progress in SDGs including Climate change, CSR Activities Issues facing Indian Economy Poverty Alleviation, Jobless growth, Rising Inequalities, Migration and excessive pressure on resources, possible remedies, Pandemic situations ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 7 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… MODULE B: ECONOMIC CONCEPTS RELATED TO BANKING Fundamentals of Economics, Microeconomics Macroeconomics and Types of Economies Economics — An Introduction, Microeconomics and Macroeconomics, Types of Economies, Market, Command, and Mixed Economies Supply and Demand The Demand Schedule, Forces behind the Demand Curve, shifts in Demand, The Supply Schedule, Forces behind the Supply Curve, shifts in Supply, Equilibrium of Supply and Demand, Effect of a Shift in Supply or Demand, Interpreting Changes in Price and Quantity Money Supply and Inflation What is Money, Money Supply, Inflation, Causes of Inflation, Measures of Inflation Theories of Interest Classical Theory of Rate of Interest, Keynes' Liquidity Preference Theory of Rate of Interest, Money Demand Curve, Determination of Rate of Interest, Equilibrium in the Money Market, Effect of an Increase in the Money Supply, shifts in Money Demand or Liquidity Preference Curve, Hicks-Hansen Synthesis, IS-LM Curve Model Business Cycles Characteristics of a Business Cycle, Phases of a Business Cycle Monetary Policy and Fiscal Policy Tools of Monetary Policy, how did Monetary Policy in India Respond to the Global Financial Crisis? Fiscal Policy, FRBM Act National Income and GDP Concepts Computation, Utility Union Budget Receipts, Expenditure, Plan Expenditure, Deficit Concepts ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 8 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… MODULE C: INDIAN FINANCIAL ARCHITECTURE Indian Financial System — An Overview What is a Financial System? Phase I: Pre-1951 organisation, Phase II: 1951 to Mid-eighties organisation, Phase III: Post Nineties Organisation, Narasimham Committee (1991) on the banking system in India, Reform of the Banking sector (1992-2008), Present Status of Banking System Indian Banking Structure Functions, Development of Banking in India, Scheduled Commercial Banks- Types and functions, Local Area Banks, Regional Rural Banks, Cooperative Banks, Payment Banks and Small Finance Banks, NBFCs, Key RBI Guidelines Ranking Regulation Act. 1949 and RBI Act, 1934 Background of Enactment, PART-1 Reserve Bank of India Act, 1934: Chapter I to Chapter V, Schedules to the RBI Act, 1934, PART-I1 Banking Regulations Act, 1949, Background and Structure of the Banking Regulation Act: Section 1 to Section 56 Development Financial Institutions Evolution of Development Financial Institutions in India, Gaps in the Post-Independence Financial System, Objectives of Development Financial Institutions, Classification of DFIs, Role of DFIs in the Indian Economy, Changing Role of DFIs and Emergence of Universal Banks, Industrial Finance Corporation of India (IFCI), Industrial Credit and Investment Corporation of India (ICICI),Industrial Development Bank of India (IDBI), Small Industries Development Bank of India (SIDBI), Export Import Bank of India (EXIM Bank), National Bank for Agriculture and Rural Development (NABARD), National Housing Bank (NHB), National Bank for Financing Infrastructure and Development (NaBFID) Micro Finance Institutions. Evolution of Microfinance in India, Grameen Bank Model, Delivery of Microfinance, SHG-Bank Linkage programme, Joint Liability Groups (JLGs), Regulatory Framework for Microfinance Institutions, Inclusion of Bank Finance to Microfinance Institutions in Priority Sector Lending, Regulatory Framework for Micro Finance Loans RBI Directions 2022, RBI's Fair Practices Code for NBFC-MFIs Non-Banking Financial Companies What is a Non-Financial Banking Company (NBFC)?, Evolution of NBFCs in India, Role of NBFC in Promoting Inclusive Growth of India, Regulators of NBFCs, Classification of NBFCs, Regulatory Oversight by RBI on NBFCs, Types of NBFCs, Concept of Owned Funds and Net Owned Funds (NOF) for NBFCs, Bank Finance to NBFCs, Fair Practice Code for NBFCs, Applicability of ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 9 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… Ombudsman Scheme to NBFCs, Scale Based Regulation (SBR): A Revised Regulatory Framework for NBFCs Insurance Companies History and Development of Insurance. Privatisation and Foreign Direct Investment (FDI) in Insurance Sector. Insurance Business Globally and in India. Insurance Penetration and Density. Number of Insurance Companies Operating in India. Legislations Governing Operation of Insurance Companies. Insurance Intermediaries. Reinsurance. Insurance Repository's-Insurance Account Indian Financial System - Regulators & their roles Role of Financial Sector Regulators in an Economy, Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI), Insurance Regulatory and Development Authority of India (IRDA), Pension Fund Regulatory and Development Authority (PFRDA) Reforms & Developments in the Banking sector Bad Banks, Infrastructure financing, Formation/role of NaBFID-National Bank for Financing, Infrastructure & Development, Basic concepts on EASE. MODULE D : FINANCIAL PRODUCTS AND SERVICES Overview of Financial Markets What is a Financial Market?, Evolution of the Financial Market, Segments of Financial Markets, Functions of Financial Markets, Price Discovery Money Markets and Capital Markets Call Money, Notice Money and Term Money, Treasury Bills, Certificates of Deposit, Commercial Paper, Repo, Tri-Party Repo, Bill Rediscounting Scheme (BRDS), Long-Term Repo Operations (LTRO) Fixed Income Markets - Debt / Bond Market Government Securities, Bond Valuation and Theorems, Auction of Government Securities, Primary Dealers, Fixed Income Money Market and Derivatives Association of India (FIMMDA), RBI Retail Direct Scheme (BRDS), Corporate Bond Market, Inter-Corporate Deposits Capital Markets and stock Exchanges Primary Market, Secondary Market Stock Exchanges in India, Financial Products/Instruments Dealt with in the Secondary Market, Regulatory Requirements Specified by SEBI for Corporate Debt Securities, Commonly Used Terms in the Capital Market, Types of Capital Issues in the ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 10 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… Primary Market, Eligibility Norms for Making Capital Issues, Intermediaries in an Issue in the Primary Market, Applications Supported by Blocked Amount (ASBA) Qualified Institutional Placement (QIP) Forex Markets Profile of Foreign Exchange (Forex) Market, Evolution of the Forex Market in India, Characteristics of the Forex Market, Market Participants, LIBOR and Alternate Reference Rates (ARRs), Foreign Exchange Dealers Association of India (FEDAI), Foreign Exchange Management Act (FEMA), 1999, FX-Retail Platform, US Dollar Index (USDX), American Depository Receipt (ADR) and Global Depository Receipt (GDR) Interconnection of various markets/Market Dynamics Process of Interconnectedness of Financial Markets, Reasons for interconnectedness, Importance of Interconnectedness of Financial Markets, Heterogeneity of Financial Markets, Achievement of Market Integration in India, Different Levels of Market Integration, Asian Clearing Union, Benefits and Costs of Interconnectedness of Markets, Interconnectedness of the Money Market, Interconnectedness of the Credit Market, Interconnectedness of the Capital Market, Interconnectedness of the Forex Market, Integrated Treasury Operations, Contagion Effect Merchant Banking Services Definition of Merchant Banking, Historical Background, Development of Merchant Banking in India, Merchant Banking Vs Commercial Banking, Licensing Requirements, SEBI Regulations on Merchant Banking, Activities of Merchant Banks, Key Policy Requirements as per SEBI Regulations, Key Codes of Conduct as per SEBI regulations Derivatives Market including Credit Default Swaps What is a Derivative. History of Derivatives, Size of the Derivatives Market, Underlying Assets, Exchange Traded and Over-the-Counter Markets, Participants in the Derivatives Market, Functions of Derivatives, Types of Derivatives, Forward Contracts, Futures, Options, Swaps, Credit Default Swaps (CDS), RBI guidelines on Credit Default Swaps, Documentation for Derivatives — ISDA Agreement. Factoring, forfaiting & Trade Receivables Discounting System (TReDS) What is Factoring, History of Factoring, Types of factoring, Domestic Factoring, International Factoring, Bills Discounting vs Factoring, Fees Involved in Factoring, Advantages of Factoring, What is Forfaiting, Mechanism of a Forfaiting Transaction, Fees Involved in Forfaiting, Advantages of Forfeiting, Differences between Factoring and Forfaiting, What is TReDS? Participants under TReDS, Process Flow under TReDS, Eligibility Criteria to Set Up and Operate TReDS. ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 11 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… Venture capital Concept of Venture Capital, Evolution of Venture Capital in India, Characteristics of Venture Capital Finance, Stages of Venture Capital Financing, Process of Venture Capital Financing, Regulatory Aspects of Venture Capital Funds, Modes of Venture Capital Financing, Advantages and Disadvantages of Venture Capital Financing, Exit Routes for Venture Capital Finance. Leasing and Hire Purchase Lease Finance, Evolution of Leasing in India, Types of Leasing, Advantages and Disadvantages of Lease Finance, Market Share of Various Leased Asset Classes, Impact of Leasing on Financial Ratios, Legal Aspects of Leasing, Regulatory Aspects of Leasing Activities, Hire Purchase, Evolution of Hire Purchase in India, Legal Aspects of Hire Purchase, Parties to a Hire Purchase Contract, Leasing and Hire Purchase Compared, Credit Rating agencies & their functions What is Credit Rating? Credit Rating Agencies (CRAs) ;History of Credit Rating; Characteristics of Credit Rating ;Importance of Credit Rating, Benefits of Credit Rating, Factors Considered while Rating Companies/Instruments, Process of Credit Rating, Credit Rating Symbols, Ratings Outlook, Regulations for CRAB in India, Fees for Credit Rating, What is Credit Scoring?, Credit Information Companies (CICs) in India, Membership to CICs, Regulatory Guidelines Governing CICs, Credit Scores, Difference Between Credit Ratings and Credit Scores Mutual Funds Mutual Funds and their Functions, Management of Mutual Funds, Evolution of Mutual Funds, Classification of Mutual Funds, Role of Mutual Funds, Supervision of Mutual Funds, New Fund Offer, Risks Associated with Mutual Funds, Risk Depiction — Riskometer, Net Asset Value (NAV), Expenses Ratio, Load/No-Load Funds, Strategies for Investment in Mutual Funds, Role of Mutual Funds in the Capital Market, Alternative Investment Funds Insurance Products What is Insurance? Fundamental Principles Governing Insurance Products, Classification of Insurance, Types of Insurance Business, Group Insurance Schemes, Micro Insurance, Insurance Based Social Security Schemes, Bancassurance, Insurance Ombudsman Scheme, Government Business Products (Social Security Schemes like PAJJBY, PMSBY) Pension Funds (include APY, NPS) Pension System and its Aspects, Pension Products, Different Types of Pension Schemes, Employees Provident Funds Scheme, Public Provident Fund (PPF) Scheme, Insurance Annuity Schemes, National Pension Scheme (NPS), Atai Pension Yojana (APY) ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 12 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… Guidelines on Para Banking & Financial Services provided by Banks Types of Para Banking and Financial Services provided by Banks, Organisation of Para Banking and Financial Services Activities by a Bank, Para-Banking and Financial Services Undertaken by a Bank, Disclosure of Commissions/Remunerations earned from Para Banking and Financial Services Activities Real Estate Investment Funds I Infrastructure Investment Fund (concept) What are Real Estate Investment Trusts (REITs), History of REITs, Organisation of REITs, Types of REITs, Difference Between REITs and Real Estate Mutual Funds, Advantages and Disadvantages of Investing in REITs, Comparison of Various Modes of Investment in Real Estate, Taxation Guidelines for Investors of REITs, Regulatory Guidelines for REITs. What are Infrastructure Investment Trusts (InvITs), Organisation of InvITs, Rationale of Setting up InvITs, Activity of InvITs in India, Types of InvITs, Advantages and Disadvantages of InvITs, InvIT's Revenue Model, Taxation on Investments in InvITs ……………………………………………………………………………………………………………………………………….…. ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 13 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… Indian Economy & Indian Financial System MODULE A – INDIAN ECONOMIC ARCHITECTURE Unit - 1. An Overview of Indian Economy 1. In terms of GDP purchasing power parity (PPP), India ranked 3rd in the world only after USA and China (IMF WEO April 2022). 2. According to the Angus Maddison database, India and China contributed 50.5 per cent of global GDP in 1000 AD. 3. As per the work of Angus Maddison, India’s share of global income was 23 per cent in 1600 A.D., but, by the time the British left in 1947, it had shrunk to only 3 per cent. 4. The British East India Company, ignored industrialisation in the nation, and infrastructure was created not to industrialise India, but to exploit its raw materials. 5. India accounted for 33 % of global trade in 1600, but fell to less than 3 % in 1947. 6. The pre-independence period was characterised by near-stagnation, with little change in the organisation of production or productivity levels. 7. As per the World Bank classification, Indian economy is a lower-middle income economy, which is attributed to low per capita income, high levels of poverty, unemployment and illiteracy. 8. Following independence and the start of the planning process, agriculture’s share decreased, while the shares of industry and services increased. 9. During the time of direct British control from 1858 to 1947, the colonial government’s official transfers of monies to the United Kingdom were referred to as “Home Charges”. 10. India’s growth rate was slow (3.5 per cent) during the first three decades after independence. In 1978, Professor Raj Krishna coined the phrase “Hindu rate of growth” to describe the slow growth of the Indian economy. 11. Following the 1991 economic crisis, the implementation of reforms and the adoption of LPG (Liberalisation–Privatisation–Globalisation) policies paved the way for positive economic outcomes and higher GDP growth rates. 12. According to the provisional estimates of annual national income, 2021-22, the growth in GDP during 2021-22 is estimated at 8.7 per cent, as compared to a contraction of 6.6 per cent in 2020-21. 13. The COVID-19 pandemic disrupted global supply chains, shipping, and logistics, as well as affecting the Indian economy through mass lockdown, loss of life, and destruction in permanent demand. 14. According to the International Monetary Fund (IMF), India’s contribution of global GDP reached 7.3% in 2021. However, in terms of GDP purchasing power parity (PPP), India is ranked 3rd in the world only after USA and China. ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 14 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… 15. A number of factors influence the nature and characteristics of the Indian economy. Some of these factors include: (i) low per capita real income, (ii) rapid population growth, (iii) a high rate of unemployment, underemployment, and disguised unemployment, (iv) excessive reliance on the primary sector, (v) a vicious circle of poverty, and (vi) rising unemployment. 16. 1950 : Agriculture was a dominant sector : 53.1% of GDP, Industry : 16.6%,, services : 30.3%. 17. 1980–81, the services sector (38%) surpassed agriculture (36.1%) to become the largest contributor to India’s GDP. Industry : 25.9% 18. Under British rule, India remained a low-quality labour market. Less than 1/6 of Indians were only literate. 19. 1867-68 : Dadabhai Naoroji published the first estimates of national income in India in his book “Poverty and Un-British Rule in India” 20. According to him, British India’s national income was Rs. 340 crore, Per capita income was Rs. 20 per annum at current prices 21. In 2008, in order to mitigate the effects of the crisis, the government provided 3 stimulus packages totalling Rs. 1.86 lakh crore (3.5% of GDP) to the economy. 22. The RBI eased monetary conditions and injected Rs 5.6 lakh crore (roughly 9% of GDP), in domestic and external liquidity. 23. Prior to the COVID-19 pandemic, the economy’s average annual growth rate between 2008- 09 and 2019-20 = 6.5% (base year 2011-12 prices) 24. COVID-19  End of Dec 2019: First reported officially in Wuhan, China  Mar 11, 2020: COVID-19 was declared as pandemic  Jan 30 2020: 1st COVID-19 case was recorded in India  India has had three waves of infections as on June 2022, pushing its total case load to the world’s second highest.  On January 16, 2021, India launched its vaccination programme.  A number of factors responsible for the most severe economic impact on India, with the severity of the lockdown being the most frequently stated explanation.  GDP contraction was more severe in countries with a higher stringency index — India, Argentina, Italy, and the United Kingdom. 25. Economic Recovery Dynamism Post COVID  During the first wave of infections, India had one of the world’s worst recessions.  In the Q1 of 2020-21: GDP contracting by as much as 23.8%  Supported by low base, economy recovered handsomely in 2021-22.  The growth in GDP during 2021-22, estimated at 8.7% as compared to a contraction of 6.6 % in 2020-21 ………………………………………………………………………………………………………………………………………………… ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 15 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… Unit - 2. Sectors of the Indian Economy 1. Primary sector includes all those economic activities where there is the direct use of natural resources as agriculture, forestry, fishing, fuels, metals, minerals, etc. 2. Secondary sector includes all economic activities that involve the processing of raw materials extracted from the primary sector also called industrial sector. An industrial economy is the one, in which, the secondary sector generates at least half of a country’s national GDP and employment. 3. Tertiary sector includes all economic activities that produce services, such as education, healthcare, banking, communication, and so on. 4. Difference between the sectors Primary Sector Secondary Sector Tertiary Sector Agriculture, forestry, and mining Manufacturing units, small-scale This sector involves banking, are examples of activities in this units, major enterprises, and global insurance, and sector organisations are all included communications Known as agriculture and The industrial and manufacturing Known as the service sector associated services sector is often known as the manufacturing sector Provides raw materials for the Transforms one good into another Offers valuable services to production of goods and services by value addition to it the primary and secondary sectors Unorganised and most of the Organised and employs more It is well-organised and use times employs old methods efficient production methods advanced logistics techniques to carry out its tasks In most developing economies, Since this sector requires a This sector’s employment such as India, this sector employs particular set of talents, the share has risen dramatically a large proportion of the employment rate is in equilibrium. in recent years workforce, compared to developed countries. 5. Quaternary sector is also known as the ‘knowledge’ sector. This includes activities such as teaching, research and development, Hospitals and physicians’ offices, Theatres, Accountancy and Brokerage businesses 6. Quinary Sector includes occupations such as Senior company executives, Government officials, Research scientists, Financial and legal advisors and others 7. Agriculture’s share of the country’s gross income has been declining, while the industrial and service sectors’ shares have been steadily increasing. 8. Industry’s share of GVA has increased from nearly 17 per cent in 1950–51 to 29 per cent in 2021–22 ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 16 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… 9. The services sector’s proportion has increased from 33 per cent in 1950 to 53 per cent in 2021-22 10. The construction sector is the second largest employment sector in the country, only after agriculture. It employs over ~31 million people and accounting for around 8 per cent of total employment. 11. Green Energy, Fintech, Information Technology, Electronics, Pharmaceuticals, Automobiles, Healthcare, Infrastructure Sector, Retail Sector, Processing Plants, and other emerging sectors of the Indian economy, form part of the Sunrise Sector 12. The organised sector is the one, in which, the job terms are fixed and regular, and the employees are guaranteed work. The organised sector comprises manufacturing, enterprise, business, school, hospital, and unit registered with the government. 13. Unorganised sector, on the other hand, is one in which employment terms are not defined and regular, and enterprises are not registered with the government. Construction workers, domestic workers, street workers, and those operating in tiny workshops unaffiliated with the government are all part of the unorganised sector. 14. Difference between Organised and Unorganised sectors BASIS FOR ORGANISED SECTOR UNORGANISED SECTOR COMPARISON Meaning The sector in which the The sector that comprises of employment terms are fixed small scale enterprises or and employees have assured units and are not registered work is Organised sector. with the government. Governed by Various acts like Factories Act, Not governed by any act. Bonus Act, PF Act, Minimum Wages Act etc. Government rules Strictly followed Not followed Remuneration Regular monthly salary. Daily wages Job security Yes No Working hours Fixed Not fixed Overtime Workers are paid remuneration No provision for overtime. for overtime. Salary of workers As prescribed by the government. Less than the salary prescribed by the government. Contribution to Yes No Provident fund by the employer Increment in salary Once in a while Rarely Benefits and Employees get add-on benefits Not provided. perquisites like medical facilities, pension, leave travel compensation, etc. ………………………………………………………………………………………………………………………………………………… ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 17 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… Unit - 3. Economic Planning in India & NITI Aayog 1. As per Economist H. D. Dickinson, Economic Planning can be defined as “the making of major economic decisions–what and how much is to be produced and to whom it is to be allocated by the conscious decision of a determinate authority, on the basis of a comprehensive survey of the economic system as a whole.” 2. National Planning Committee, set up in 1938 by the Indian National Congress defined planning in India as “Planning, under a democratic system, may be defined as the technical coordination, by disinterested experts of consumption, production, investment, trade, and income distribution, in accordance with social objectives set by bodies representative of the nation. Such planning is not only to be considered from the point of view of economics, and raising of the standard of living, but must include cultural and spiritual values, and the human side of life.” 3. Planning is a vital component of every economy and is carried out at many levels. It is the skill of reaching any sort of objective utilising the resources at hand. 4. India has a centralised planning procedure that offers a broad framework for the economy’s developmental and investment requirements. The Planning Commission was in charge of planning in India since 1950. 5. Depending on the goal, planning may be categorised into several types. From a territorial standpoint, planning may be regional or national. Similarly, from a political standpoint, planning might be federal, state, or local. 6. Planning may be classified as centralised or decentralised planning from the standpoint of participation. From a temporal standpoint, planning might be long-term or short-term. Similarly, planning may be sectoral as well as geographical. 7. Objectives of Economic Planning in India  Economic Growth  Poverty Alleviation  Employment Generation  Social justice and reducing the inequalities  Self-reliant economy  Modernisation of the economy 8. Five-Year Plans and their Performance  Fundamental goal : To raise national income as well as per capita income.  However, both national and per capita income growth were quite modest during the planning era.  7 of the 12 five-year plans experienced lower growth rates than expected.  Growth rates were modest during the first three decades of planning, but then picked up.  Massive fluctuations were another aspect of growth story. ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 18 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 …………………………………………………………………………………………………………………………………………………………………  Negative per capita income growth has recorded in times such as 1971–72 and 1991– 92.  Agriculture growth has indeed been highly volatile, due to the change in environmental factors. The green revolution of the 1960s and the government’s efforts to promote agriculture via different programmes have worked splendidly for the country.  Today, India, has not only attained self-sufficiency in food grains production, but also a leading exporter of many agricultural products.  With the expansion of the iron and steel, machine tool, and heavy engineering industries, India has made major strides toward capital equipment self- sufficiency.  Engineering items account up a significant portion of India’s exports, contributing for around 86 per cent of overall merchandise exports. 9. The National Institution for Transforming India, generally known as NITI Aayog, was established on January 1, 2015, by a resolution of the Union Cabinet and replaced Planning Commission. 10. NITI Aayog is chaired by the Prime Minister. The governing council of NITI Aayog is made up of the chairperson, ex-officio members of NITI Aayog, vice chairperson, full-time members, chief ministers of states, the Lieutenant Governor of the Andaman and Nicobar Islands (Union Territories), and special invitees of NITI Aayog. 11. In December 2018, NITI Aayog published its comprehensive national Strategy for New India which is a full exposition spanning 41 critical areas that recognises previous accomplishments, identifies binding restrictions, and recommends a path ahead to achieve the explicitly defined objectives. 12. Functions of NITI Aayog  To develop a shared vision of national development priority sectors and strategies, with active state participation, in the light of national objectives.  To promote cooperative federalism on a constant basis through organised support programmes and processes with the states, understanding that strong states make a strong nation.  To create procedures for developing viable plans at the village level and gradually aggregating these at higher levels of government.  To ensure that national security considerations are included into economic strategy and policy in areas explicitly referenced to it.  To give special attention to those segments of our society, who may be at danger of not benefiting adequately from economic advancement.  Create strategic and long-term policy and programme frameworks and initiatives, as well as track their development and efficacy. Lessons learned through monitoring and feedback will be utilized to make novel changes, including midcourse adjustments.  To give guidance and foster collaboration between important stakeholders and like- minded think tanks on a national and worldwide level, as well as educational and policy research organisations. ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 19 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 …………………………………………………………………………………………………………………………………………………………………  To establish a collaborative network of national and international specialists, practitioners, and other partners to encourage knowledge, innovation, and entrepreneurship.  To provide a forum for the resolution of cross-sectoral and cross-departmental issues in order to expedite the execution of the development plan.  Maintaining a cutting-edge Resource Centre, serving as a repository for research on good governance and best practices, in sustainable and equitable development, and assisting in their dissemination to stakeholders  Actively monitor and assess programme and initiative execution, including the identification of required resources, in order to increase the likelihood of success and scope of delivery.  To concentrate on technological advancement and capacity building for programme and initiative execution.  To carry out any additional actions that may be required to enhance the implementation of the national development strategy and the previously indicated goals. 13. The 41 chapters of the comprehensive national Strategy for New India are divided into four sections: Drivers, Infrastructure, Inclusion, and Governance 14. In India, there are three key sources of funds available for funding economic plans: Domestic budgetary sources, deficit financing, and foreign assistance 15. Taxation is among the most significant domestic budgetary resources for channelising funds for planning. ………………………………………………………………………………………………………………………………………………… Unit - 4. Role of Priority Sector and MSME in the Indian Economy 1. Micro, Small, and Medium Enterprises (MSMEs) are among the country’s strongest drivers of economic growth, innovation, and employment. The primary benefit of the MSME sector is its employment potential, at a low capital cost. 2. MSME sector contributes roughly 45 per cent of manufactured production, more than 40 per cent of exports, and more than 28 per cent of GDP, while employing approximately 120 million people. 3. Definition & Role of Priority Sector  The current framework of Priority Sector Lending (PSL) dates back to Dec 14, 1967: States in Lok Sabha by Morarji Desai, then Deputy Prime Minister and Minister of Finance, that persistent complaints that several priority sectors, such as agriculture, SSI, & exports, had not received their fair share of bank credit.  Banking Laws (Amendment) Bill 1967, tabled in the Lok Sabha on December 23, 1967 introduced Social Control over banks ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 20 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… 4. List of Priority Sectors identified in India i. Agriculture ii. Micro, Small and Medium Enterprises (MSMEs) iii. Export Credit iv. Education v. Housing vi. Social Infrastructure vii. Renewable Energy viii. Others ix. Weaker sections 5. Priority Sector Lending Norms Categories Domestic Foreign banks Regional Rural Small Finance commercial with less than 20 Banks Banks banks (excl. RRBs branches & SFBs) & foreign banks with 20 branches and above Total Priority 40 per cent of 40 per cent of 75 per cent 75 per cent of Sector ANBC or CEOBE ANBC or CEOBE of ANBC or CEOBE ANBC or CEOBE whichever is whichever is whichever is whichever is higher higher; out of higher; However, higher. which up to 32% lending to Medium can be in the Enterprises, Social form of lending to Infrastructure and Exports and not Renewable Energy less than 8% can shall be reckoned be to any other for priority sector priority sector achievement only up to 15 per cent of ANBC. ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 21 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… 6. Sub-targets for Priority sector Categories Domestic commercial Foreign banks Regional Rural Small Finance banks (excl. RRBs & with less than Banks Banks SFBs) & foreign banks 20 branches with 20 branches and above Agriculture 18 per cent of ANBC or Not applicable 18 per cent 18 per cent of CEOBE, whichever is ANBC or ANBC or CEOBE, higher; out of which CEOBE, whichever is a target of 10 percent# Whichever is higher; out of is prescribed for Small higher; out of which a target of and Marginal Farmers which a target 10 percent# is (SMFs) of 10 percent# prescribed is prescribed for SMFs for SMFs Micro Enterprises 7.5 per cent of ANBC or Not applicable 7.5 per cent of 7.5 per cent of CEOBE, whichever is ANBC or ANBC or CEOBE, higher CEOBE, whichever is whichever is higher higher Advances to 12 percent# of ANBC or Not applicable 15 per cent of 12 percent# Weaker Sections CEOBE, whichever is ANBC or of ANBC or higher CEOBE, CEOBE, whichever whichever is is higher higher # Revised targets for SMFs and Weaker Section will be implemented in a phased manner as indicated below 7. The priority sector lending targets for the Domestic commercial banks (excluding RRBs & SFBs) & foreign banks with 20 branches and above is 40 per cent of ANBC or CEOBE whichever is higher. 8. The new definition of MSMEs will make it easier for small businesses to expand and flourish. The resulting economies of scale can boost productivity without depriving MSMEs of government benefits such as market support, export promotion, preferential procurement in the public sector. ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 22 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… 9. Definitions of MSME – Old Vs New Old Definition New Definition Manufacturing Services Manufacturing/Services Micro Investment in Plant Investment in Investment in Plant and Machinery or and Machinery: Equipment: Equipment and turnover: Does not exceed Does not exceed The investment in plant and machinery or Rs. 25 Lakh. Rs. 10 Lakh. equipment does not exceed Rs. 1 Crore and turnover does not exceed Rs. 5 crores. Small Investment in Plant Investment in Investment in Plant and Machinery or and Machinery: Equipment: Equipment and turnover: More than Rs. 25 More than Rs. The investment in plant and machinery or lakhs but does not 10 Lakh but equipment does not exceed Rs. 10 crore exceed Rs. 5 crores does not exceed and turnover does not exceed Rs. 50 crores. Rs. 2 crores Medium Investment in Plant Investment in Investment in Plant and Machinery or and Machinery: Equipment: Equipment and turnover: More than Rs. 5 More than Rs. 2 The investment in plant and machinery or crores but does not crores but does equipment does not exceed Rs. 50 crore exceed Rs. 10 not Rs. 5 crores. and turnover does not exceed Rs. 250 crores. crores. 10. As per the latest data there are around 36.1 million MSME units, spread across the country, and MSMEs contribute approximately 6.11 per cent of manufacturing GDP and 24.63 per cent of service GDP. 11. The “Make in India” project is built on four pillars established to boost entrepreneurship in India, not just in manufacturing but also in other sectors. New Processes, New Infrastructure, New Sectors, and New Mind-set are the four pillars. 12. The Start-up India Scheme aims to support individuals or businesses that have recently formed their own start-ups by offering better finance, including tax breaks, and ensuring that the process of establishing a start-up in India is smooth and quick. 13. The Production Linked Incentive Scheme (PLI) is a traditional and widely employed government method for increasing the production of products considered important for job creation, social welfare, and taxation. PLIs are simply financial incentives for enterprises to increase output. Current PLI scheme covers 13 sectors. 14. The PLI scheme would make Indian firms globally competitive, encourage investment in core competencies and cutting-edge technology, assure efficiencies, produce economies of scale, boost exports, and integrate India into the global supply chain. 15. Udyami Mitra Portal is launched by SIDBI, to improve accessibility of credit and handholding services to MSMEs. ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 23 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… 16. MSME Sambandh: To monitor the implementation of the public procurement from MSMEs by Central Public Sector Enterprises. 17. MSME Delayed Payment Portal: This will empower Micro and Small entrepreneurs across the country to directly register their cases relating to delayed payments by Central Ministries/Departments/CPSEs/ State Governments. 18. Digital MSME Scheme: It involves usage of Cloud Computing, where MSMEs use the internet to access common as well as tailor-made IT infrastructure. 19. Prime Minister Employment Generation Programme: A credit linked subsidy programme under Ministry of MSME. 20. Scheme of Fund for Regeneration of Traditional Industries (SFURTI): Organises traditional industries and artisans into clusters and make them competitive by enhancing their marketability & equipping them with improved skills. 21. A Scheme for Promotion of Innovation, Rural Industries & Entrepreneurship (ASPIRE): It creates new jobs & reduce unemployment, promotes entrepreneurship culture, facilitates innovative business solution, etc. 22. National Manufacturing Competitiveness Programme (NMCP): To develop global competitiveness among Indian MSMEs, by improving their processes, designs, technology, and market access. 23. Micro & Small Enterprises Cluster Development Programme (MSE-CDP): Adopts cluster development approach, for enhancing the productivity and competitiveness as well as capacity building of MSEs. 24. Credit Linked Capital Subsidy Scheme (CLCSS): It is operational for upgradation of technology for MSMEs. ………………………………………………………………………………………………………………………………………………… ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 24 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… Unit - 5. Infrastructure including Social Infrastructure 1. Infrastructure is the foundation for economic growth, and it encompasses the physical, natural, and organisational structures required for long-term economic development. 2. The source of finance differs greatly between sectors. Some, like railways and nuclear power, are government monopolies. Some industries are dominated by government spending, while others are controlled by Overseas Development Aid (ODA), and yet, others are dominated by private sector investment. 3. National Investment and Infrastructure Fund (NIIF) was introduced by the Government of India, to improve infrastructure finance in the country 4. Hard infrastructure refers to major physical networks such as roads, ports, airports, pipelines, etc., that are required for the operation of a modern industrial nation. 5. Soft infrastructure refers to institutions that are essential to keep the economy running, such as financial, educational, healthcare, and law-enforcement organisations. It is also segregated as physical and social infrastructure. 6. Some of the major infrastructures are  Energy Infrastructure  Water Management Infrastructure  Communications Infrastructure  Critical Infrastructure  Transport Infrastructure  Urban Infrastructure  Green Infrastructure 7. Green infrastructure is a concept that highlights the value of natural environment. The life support services provided by a network of natural ecosystems are emphasised. 8. Health, education, water supply, transportation, agriculture and allied activities, infrastructure, irrigation, management of natural resources such as water, forest, land, energy, welfare programmes and services, and so on are all included in the social sector. 9. Positive externalities are associated with social infrastructure. It plays an important role in a country’s economic development and wellbeing. 10. Social Sectors include Health, Education, Water supply, Transportation, Agriculture and allied activities, Infrastructure, Irrigation. 11. At the time of independence, its literacy level was barely 17 per cent, with a life expectancy of 32.5 years at birth. The country’s literacy rate is now 74.04 per cent, and the average life expectancy is 70 years. 12. Investing in human capital including education, skill development, training, and the provision of healthcare facilities increases labour productivity and societal welfare. 13. ESG (Environmental, Social, and Governance) refers to the three most essential factors which determine the long-term and ethical impact of a business or company investment ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 25 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… 14. The necessity for a strong and resilient health infrastructure was emphasised during the recent COVID-19 pandemic, which exposed the weaknesses in social infrastructure, across geographies. 15. As per the Economic Survey 2021-22, the healthcare sector’s budgeted spending was Rs. 4.7 lakh crore in 2021-22, accounting for roughly 2.1 per cent of GDP and 6.6 per cent of total expenditure. 16. The budgeted spending in the education sector was Rs. 6.97 lakh crore in 2021-22, accounting for almost 3.1 per cent of GDP and 9.7 per cent of total expenditure. 17. The National Education Policy-2022 is built on four pillars: accessibility, equity, quality, and accountability. 18. The primary goal of the Family Welfare programme is to stabilise the population and offer high quality health services, including immunisation of pregnant women and children. 19. Population management is the core and fundamental goal of the family welfare programme. 20. Health infrastructure is an essential metric for assessing a country’s healthcare policy and welfare system. ………………………………………………………………………………………………………………………………………………… ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 26 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… Unit - 6. Globalisation — Impact on India 1. The term “globalisation” refers to the increasing interconnectedness of the world’s economies, cultures, and inhabitants, as a result of cross-border trade in goods and services, technology, and flows of investment, people, and knowledge. 2. Proponents of globalisation believe that it helps developing countries to catch up to developed ones through increased manufacturing, diversification, economic development, and higher living standards. 3. The advent of globalisation caused significant changes in the Indian economic policies, production, and consumer behaviour. 4. Effects of globalisation in India, include increased per capita income, better employment opportunities, and far more options for customers. 5. The importance of mutual understanding and dialogue among governments, organisations within and across borders, to promote social cohesion, which is a key proposition of fair Globalisation. 6. At the local, national, regional, and global levels, fair globalisation must be supported by the interdependent and mutually reinforcing pillars of economic development, social development, and environmental protection. 7. The process of reducing dependency and integration amongst particular units throughout the world is known as deglobalisation. 8. During economic and geopolitical crises, globalisation has always taken a hit, as WTO regulations allow governments to practise trade protection measures to preserve national interests, within specific limits. 9. Protectionism results a decline in trade, price rise, and a form of subsidy for protected industries. 10. Unprecedented events in the recent years such as Brexit, withdrawal of the US from the Trans-Pacific Partnership, the US-China Trade Disputes, recent COVID-19 Pandemic and the Russia-Ukraine conflict are reasons for call against globalisation. ………………………………………………………………………………………………………………………………………………… ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 27 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… Unit - 7. Economic Reforms 1. Economic reforms aimed at expanding private sector participation in the Indian economy’s growth process. 2. Since 1980s, India has seen a number of changes that fit into two categories.  The 1980s reforms, influenced by the renowned ‘Washington Consensus’ doctrine.  The reforms that started in the early 1990s in the domains of industry, commerce, investment, and, subsequently, agriculture, were considerably broader in scope. 3. Reasons for the Economic reforms of 1991 are  Adverse balance of payments position  Poor performance of the public sector  Drop in foreign exchange reserves  Large government debts  Inflationary pressure  Stringent conditions laid down by the World Bank and IMF 4. The green revolution and industrial modernisation have transformed India’s economy from an economic laggard to one of the world’s fastest growing economies. 5. The three main pillars of economic reforms of 1991 were known as LPG (Liberalisation, Globalisation, and Privatisation). 6. Liberalisation was conceived with the idea that regulations imposed on trade agreements must be relaxed in favour for trade to thrive. 7. Privatisation refers to providing the private sector more opportunities to oversee various services while limiting the role of the public sector. 8. Globalisation in the context of economic reforms refers to the integration of the Indian economy with the global economy. It signifies that India’s economy will now be more dependent on the global economy and vice versa. 9. Banking sector reforms are aimed at making the Indian financial sector efficient, competitive, and stable. 10. First Phase of Reforms – The Narasimham Committee I (February 1992) Few of the important reforms that took place in 1992 were:  Capital adequacy norms  Progressive reduction of Cash Reserve Ratio and Statutory Liquidity Ratio  Deregulation of Lending rates  Credit delivery  Debt Recovery Tribunal (DRT)  Strong Supervisory System  Entry of New Private Banks  Mergers and Amalgamation. 11. Second Phase of Reforms – Narasimham Committee-II The benefits of the Second Phase of Banking Sector Reforms were: ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 28 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 …………………………………………………………………………………………………………………………………………………………………  Deregulation of Branch Licensing  Prudential Norms and Disclosure Requirements  Capital Adequacy 12. Important milestones of banking sector reforms  Prudential reforms  Supervisory reforms  Competition reforms  Market reforms  Institutional and legal reforms  Technology reforms  Debt Market Reforms  Foreign Exchange Market Reforms  Insurance Sector Reforms  Capital Market Reforms 13. The most significant reform in the currency market was the transition from a single currency fixed exchange rate system to controlling the level of the rupee against a basket of currencies then to a market-determined floating exchange rate system. 14. The substantial inflow of foreign investment into India in recent years reflects the country’s strong economic potential and the execution of important policy reforms. ………………………………………………………………………………………………………………………………………………… ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 29 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 ………………………………………………………………………………………………………………………………………………………………… Unit - 8. Foreign Trade Policy, Foreign Investments and Economic Development 1. Foreign trade policy refers to the economic policy that governs an economy’s export-import activity. 2. Prior to 1991, the Indian economy was protected by high tariffs and taxes. Foreign investment was not permitted in India, in addition to significant quantitative restrictions. 3. In line with the ‘Make in India’ initiative, the FTP 2015-20 provides a framework for promoting goods and services exports, as well as employment generation and value addition in the economy. 4. The FTP aimed to increase India’s merchandise and services exports from $465 billion in 2013-14 to $900 billion by 2019-20. 5. The FTP 2015-20 included two new schemes  The ‘Merchandise Exports from India Scheme (MEIS)’ for exporting defined products to designated destinations  The ‘Services Exports from India Scheme (SEIS)’ for promoting exports of designated services 6. Salient features of FTP 2015–20  Simplification & Merger of Reward Schemes  Earlier there were five different schemes (Focus Product Scheme, Market Linked Focus Product Scheme, Focus Market Scheme, Agricultural Infrastructure Incentive Scrip, Vishesh Krishi Gram Udyog Yojana - VKGUY) for rewarding merchandise exports, with different kinds of duty scrips with varying conditions attached to their use. All these schemes have been merged into a single scheme, namely Merchandise Export from India Scheme (MEIS)  Served from India Scheme (SFIS) has been replaced with Service Exports from India Scheme (SEIS).  Boost to “Make in India”  EPCG scheme : Measures have been adopted to nudge procurement of capital goods from indigenous manufacturers under the EPCG scheme by reducing specific export obligation to 75% of the normal export obligation. Measures have been taken to give a boost to exports of defense and hi-tech items.  E-Commerce : E-Commerce exports of handloom products, books/periodicals, leather footwear, toys and customised fashion garments through courier or foreign post office would also be able to get benefit of MEIS (for values up to INR 25,000).  Manufacturers : Manufacturers, who are also status holders, will now be able to self- certify their manufactured goods in phases, as originating from India with a view to qualifying for preferential treatment under various forms of bilateral and regional trade agreements. This ‘Approved Exporter System’ will help manufacturer exporters considerably in getting fast access to international markets. ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 30 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 …………………………………………………………………………………………………………………………………………………………………  EOU/EHTP/STPI/BTP Schemes : A number of steps have been taken for encouraging manufacturing and exports under 100% EOU/EHTP/STPI/BTP Schemes. The steps include a fast track clearance facility for these units, permitting them to share infrastructure facilities, permitting inter unit transfer of goods and services, permitting them to set up warehouses near the port of export and to use duty free equipment for training purposes.  Niryat Bandhu Scheme : 108 MSME clusters have been identified for focused interventions to boost exports. Accordingly, Niryat Bandhu Scheme’ has been galvanised and repositioned to achieve the objectives of ‘Skill India’.  Trade facilitation and enhancing the ease of doing business are the other major focus areas in this new FTP. One of the major objective of new FTP is to move towards paperless working in 24x7 environment. 7. Challenges to Be Addressed In Upcoming FTP  India’s high export orientation in a few large trading partners and a few products preclude its ability to fully offset any sharp decline in exports.  India needs to diversify its trading partners, both export markets and import sources, and find alternate high value products, due to scale, complementary economies and spreading risk. India may explore targeted geographies and product specific strategies.  Exploring opportunities in new markets in Africa, South-East Asia and Latin America through strategic investments, where receptiveness towards non- Chinese trading partners is more is important and needs to be explored further.  India may aim at diversifying its import suppliers. Products having high import orientation from few countries, especially China need to be diversified. The policy needs to ensure that product or market concentration of India’s trade should not go beyond specific levels.  Promoting efficacy of States in exports and exploring hitherto unexplored products are added areas to be considered for long long-term export growth. 8. FDI is a key engine of economic growth, assisting in maintaining high growth rates, enhancing productivity, and generate employment. A favourable policy framework and a stable business environment promote FDI inflows. 9. FDI enters the domestic economy through two channels: the RBI’s automatic route and the government route. 10. FDI is permitted through the automatic route without prior approval from the Government or the RBI in all activities/sectors specified in the Government of India’s consolidated FDI Policy, as amended from time to time. 11. List of Activities for which Automatic Route of RBI is not available  Petroleum Refining, Natural Gas / LNG Pipelines  Investing companies in Infrastructure & Services Sector  Defence and Strategic Industries  Atomic Minerals ………………………………………………………………………………………………………………………………………………………………… Telegram Links : JAIIB-https://t.me/jaiib2020_21, CAIIB-https://t.me/caiib2020_21, Rural Banking-https://t.me/caiib_rub HRM-https://t.me/caiib_hrm, IT-https://t.me/caiib_it, Risk Mgt-https://t.me/caiib_rm, CB - https://t.me/caiib_cb  www.jaiibcaiibmocktest.com, www.bankpromotionexams.com, www.onlyforbankers.in 31 Facebook Groups - JAIIB CAIIB STUDY MATERIALS / CAIIB DISCUSSION BANK PROMOTION EXAMS / ONLY FOR BANKERS [email protected], [email protected], 09994452442 …………………………………………………………………………………………………………………………………………………………………  Print Media  Broadcasting  Postal services  Courier Services  Establishment and Operation of satellite  Development of Integrated Township  Tea Sector  Asset Reconstructi