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India Consumer: Banks levying charge on pre-payment

You have a loan from a regular private sector bank, and your loan is for a 15 year period. Most people I know, including you, will not want to have the loan continuing for the full period of the loan, and would rather do prepayments as much as possible. However, banks apparently charge an interest for the stupid thought of returning their money to them. And it also emerges that the RBI is fine with things, as long as the banks do not charge too heavy a penalty (link to article)

A few days ago, the RBI had apparently sent a reply under RTI that it did not really approve of banks charging a penalty for pre-payment; the latest clarification was meant to even remove this statement. The RBI is stating a more hands-off policy, since these are private banks with their own management; apparently the RBI expects that market competition is enough to ensure that banks do not heavily over-charge, and that they should not charge customers more than their standard rates

Preparation for the Commonwealth Games – how good are we ?

First of all, it is difficult for an individual to really find out what the current state of the preparation for the Commonwealth Games is ? The current reality is that there is work needed to be done at various fronts – the Delhi Government has set in process a huge amount of infrastructure improvements to give the city a modern feel and look. This includes improvements to the transport infrastructure (new roads, modification of roads to reduce jams and increase speed of transport, more metro stations), improvements to the existing stadia to make them capable of handling huge international sports (for example, the Indira Gandhi Indoor stadium leaked a couple of years back when there was an international badminton event), provision of adequate power, housing, and water supplies.
There are multiple levels of responsibility in all this – there is an Organizing Committee of the Indian Olympic Association headed by Suresh Kalmadi, and of course the Delhi Government headed by Shiela Dixit is responsible for the progress of the various infrastructure initiatives. It is worthwhile to remember that one of the biggest problems quoted for infrastructural project cost over-runs in the past is poor project management. I stated in the beginning that it is difficult for an individual to assess, however, there are many other authorities who do take such assessments, and it is hard to determine whether we will follow the time honored method of Just in Time, or will there be a comfort margin before all these efforts are done.

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General stuff for the stock market

For the last couple of days, the Indian stock market has not been reacting as one would have liked. After a good upward move on mid-cap stocks in the past few weeks, there has been a small correction in the last 2-3 days, with the market falling around 100-200 points per day. One can hope that this is just a consolidation phase. The overall trend for the future in terms of growth looks impressive, with GDP growth being higher than in previous quarters, although one has to worry about what the failure of the monsoon means for the country.
Mid-caps seem to be again the flavour of the season, and some of my mid-caps (risky ones though) have gained a bit in the last one month, atleast 15-30%, which is good growth. These are across sectors. Some of these stocks are:
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