Entry-level salaries in India are amongst the lowest in the Asia Pacific region

NEW DELHI: Entry-level salaries in India are amongst the lowest in the Asia Pacific region, a study by professional services firm Towers Watson says.

The average monthly starting pay in India is around US $400 (Rs 24,000), less than one-fifth of the equivalent paid in South Korea and Singapore, said the study by Towers Watson's Data Services.

Graduate Indian employees sit towards the bottom of the Asia Pacific countries in terms of starting salary, it said, adding that it augurs well for the 'Make in India' campaign as this would give the MNCs a competitive advantage over other Asia-Pac countries.

"Although dependent on prevailing exchange rates, the findings clearly highlight India's position as a competitive and attractive workforce and talent market," said Sambhav Rakyan, Data Services Practice Leader, Asia Pacific at Towers Watson.

Out of the top 11 Asia Pacific economies, the average monthly Indian starting salary was ranked ninth.

"The disparity in salaries also illustrates how a large knowledge pool and a significant cost arbitrage makes India a front runner in providing outsourced services. After achieving great success in IT/BPO, India can now become a natural choice for other sectors, like manufacturing," he added.

Further up the ladder, wages for experienced professionals at middle management levels in India are slightly more competitive, but still below their Asia Pacific peers.

Notwithstanding the recent push in its manufacturing sector and popularity of the IT sector, an engineering manager in India earns an average salary of USD 56,530 - almost half of his Chinese counterpart (US $112,070) and one-third of his Singaporean counterpart (US $151,168), the report said.

"Despite a common labour market in the region, it is striking to see how divergent guaranteed cash levels remain amongst top economies," Rakyan added.

OBC, IOB, YES Bank to be most affected by new base rate methodology

OBC, IOB, YES Bank to be most affected by new base rate methodology

The new proposed regime for calculating base rate, the benchmark rate for pricing loans, is going to affect the lenders with greater proportion of term deposits in their funding base the most, says a Moody's report.

As per the report, Oriental Bank of Commerce (OBC), Indian Overseas Bank (IOB), YES Bank, Canara Bank and Union Bank are amongst the ones that will be most affected. While OBC has 76 per cent customer term deposit to total deposit, IOB is at 75 per cent whereas YES Bank is at 71 per cent at the end of FY15.

"Because the latest interest rates on various deposits will be used to calculate the marginal cost of funds, banks with a greater proportion of term deposits in their funding base would likely be most affected. Because longer tenor deposits are less sensitive to decreases in policy rates, they tend to increase the cost of funds derived using current calculation methods," said the report.

In the last financial year, several public sector banks such as Bank of India, IDBI, State Bank of India, Syndicate Bank, Bank of Baroda have more than 55 per cent of customer term deposit to total despoits

RBI Press Release - Bank Holiday on Second & Fourth Saturdays

Bank Holiday on Second & Fourth Saturdays from September 1; RBI to offer its Support Services to Banks on Working Saturdays

All scheduled and non-scheduled banks – public, private, foreign, cooperative, regional rural and local area banks – will observe public holiday on second and fourth Saturdays from September 01, 2015; and will observe full working days on Saturdays other than second and fourth Saturdays (referred to as working Saturdays in the Press Release). Consequent to this, the Reserve Bank of India has announced the following changes in its functioning with effect from September 1, 2015:

I. Financial Market Segments

a) The financial market segments which are currently open for transactions on Saturdays will continue to remain open on all working Saturdays. That is,

    All money market segments, namely, call/notice/term money, market repo and Collateralised Borrowing and Lending Obligation(CBLO) will remain open on all working Saturdays as on any normal business day; and
    Forex market and Government securities markets, along with all OTC derivative markets would remain closed on all Saturdays, as hitherto.

b) The Reserve Bank will continue to operate fixed rate reverse repo as well as the marginal standing facility (MSF) windows on all working Saturdays between 7:00 pm and 7.30 pm as on any normal business day.

c) The Reserve Bank will also operate a fixed rate liquidity adjustment facility (LAF) repo window on all working Saturdays between 9.30 am and 10.30 am. The LAF repo window on working Saturdays would in fact be an extension of the Friday LAF window. That is, banks could borrow for three days on Friday, within the prescribed limits, and any residual unused limit could be utilised for a 2-day period on working Saturdays.

II. Payment Systems

    Payment systems will not be operated onsecond and fourth Saturdays but would operate for full day on working Saturdays. Payment systems typically includes Real Time Gross Settlement (RTGS), National Electronic Fund Transfer (NEFT), Cheque Clearing operated by various Bankers' Clearing Houses in the country including the grid based Cheque Truncation System (CTS) and ECS suite [Electronic Clearing Service (ECS), Regional Electronic Clearing Service (RECS) and National Electronic Clearing Service (NECS)].

    Processing of future value dated transactions with value date falling on second and fourth Saturdays will not be undertaken under RTGS and ECS suite.

III. Banking Department

The Banking Departments in Regional Offices of the Reserve Bank will remain open for the full day on working Saturdays as required to support the functioning of the Financial Markets and the Payment Systems. Government business will be transacted at agency banks on working Saturdays.

It may be recalled that the Government of India issued a Notification on August 20, 2015 [published in the Gazette of India, Extra Ordinary, Part II, Section 3, Sub-Section (ii)] declaring every second and the fourth Saturday of every month as public holiday under Section 25 of the Negotiable Instruments Act, 1881 (26 of 1881). Accordingly, all banks whether or not included in the Second Schedule to the Reserve Bank of India Act, 1934 (2 of 1934) will observe holidays on second and fourth Saturdays with effect from September 1, 2015. As a regulator of banks, financial markets and payment and settlement systems, the Reserve Bank has made supporting changes in the working of some of its operational areas.

The above arrangements would be reviewed after six months.

Alpana Killawala
Principal Chief General Manager

Press Release : 2015-2016/528

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