Gujarat National Law University
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Director(Vice-Chancellor) Speeches & Important Messages

"GNLU International Banking and Investment Conference, Sunday 22 July 2012", Deliberating or Guessing Far-Sighted Solutions of the Emerging International Banking and Investment Issues and Challenges – Is this Realistic?

It gives us great pleasure to welcome the experts, practitioners, researchers, academicians, students from various parts of India to discuss the issues, challenges and solutions concerning the international banking and investment sector.
Friends, the conference fits into the overall theme and aim of GNLU to become a knowledge hub and contribute to the legal infrastructure for the nation. Last Sunday, our training focused on the administration of criminal justice and this Sunday, we are going to discuss banking and investment issues.
The conference is ambitious and the convener and the team must be complimented for identifying as many as 11 themes. Is it their goal to brainstorm all issues and challenges which have been faced by India since time immemorial just in 7 hours or is it their goal to speak out shopping-list of prescriptions for the malaise in these two sectors? Neither of these. The list of themes and the abstracts received have one modest aim, namely, to put the debates in an integrated perspective. Thus, while Dr Nagpal and Ishita Mathur argue for innovations and inclusion of all households, approximately 135 million, and remain ambitious that this will lead to growth, offer positive results based on the Grameen Bank experience, Central Bank of Brazil experience or MZANSI – National Bank Account experience of South Africa, we must remain the concerns posed by Akriti and Siddhant Jaiswal in their paper on money laundering in India because the reaching out each and every one without proper scrutiny of the identity of each and every bank account aspirant has great potential not only money laundering but terrorism financing. How we are able to know that a so-called poor and marginalized’s search for bank account is not an agent of a money launderer?
Who had thought five years back that carbon finance will become a major hundreds of billions of banking and finance industry? As Mr Kalpesh Gupta quotes from the World Bank report 2012, carbon credit market grew in total value by 11% in 2011, to $176 billion and where transaction value reached a new height of 10.3 billion tons of carbon dioxide equivalent. Apart from the direct benefits flowing from the negotiations to two major carbon producers, India and China, these two countries, using several innovative and far-sighted financial models can make best use of the opportunities to succeed in financial reach and inclusive growth of timming millions of people. I hope Mr Gupta will have some interesting practical tips for all of us.
The banking industry like any other industry can succeed if it can retain the strategic talent at the highest but also at the lower levels. While the executives can draw the forecasts and work out big merger and acquisitions, unless and until the ground level staff remain motivated and fully involved in the banking operations, much as private banks can dream to reach out village masses, their failure is guaranteed. I am very happy to see that the conference will not only talk of global issues but such issues which have immediate and far-reaching implications and rightly one of the major issues. I congratulate Mr Divya Tyagi to focus on this issue of vital importance. Islamic Banking, the new emerging issue will be deliberated by experts and students, thus opening new vistas and insights into this important sector.
Somehow, I found that quite a few speakers are focusing on the successes of developed countries models, especially the USA with regards to the financial innovations – hedging tools, securitization, credit risk mitigation strategies employed by the US banking and financial systems which have been working in the liberal, private markets for hundreds of years. How much experience we have – a less than 40 years in this regard? I am sure the concerned speakers will be more practical yet conservative, more ambitious yet realistic in their assessment and simply will not pass sweeping judgments or conclusions during their discourses.
Carbon banking and Green banking – we are really ready to follow the Western models at least in terms of concepts and what may be simply termed as propagandistic or ideological blind-rush. I am not criticizing nor I am discouraging the researchers to analyse and speak out their findings but I am only requesting that such concepts and practices should not only look at what is the trend in the last 10-20 years but subject your analysis to more rigorous study and explain and understand the emerging fancy jargons in the banking industry, like what we had for a long time in business administration, from a political economy history of at least last few decades. Because what seems to be fascinating on the surface may have much deep rooted consequences and origins, so let’s be very careful in offering solutions which are available on internet, without knowing the source and history. I was reading a day before yesterday in the magazine called Uday India and was surprised to learn about the staggering amount of money involved in the online research industry. The small write up, more like a satirical, written to respond to the plagiarism and online research getting into educational and research institutions and specifically into USA and UK and which criticizes Indian educational and research institutions on the plagiarism and other counts. It reminded me immediately of Time calling Dr Manmohan Singh Under Achiever and Outlook calling President Obama the same, interestingly both lavishing praise on the respective dignitaries few years back – a media war. I am sure the researchers and analysts are acutely aware of this syndrome, especially while drawing conclusions and offering solutions, as I said based on superficial research.
I am very pleased that this conference will discuss the issues and challenges at all levels which is truly an integrated approach of any debate, will discuss the ideas and plans drawn from banking and financial industry of Mauritius to Brazil to South Africa to USA, will outline the roles and responsibilities of the Reserve Bank of India – a mammoth regulatory body having enormous powers seen unlike in any similar economy and the one who wants to further monopolize whatever it can do under the garb of regulation requirements, etc.
This conference which is organized under the banner of the GNLU Centre on Banking Investment and Taxation will, in coming days, inspire us to undertake teaching, research, extension and training on a sustainable basis and we are sure the excellent premises will offer venue to banking and financial industry of the entire globe to converge at the GNLU in coming years to discuss more meaningfully the issues and challenges. Unless the policy-makers and practitioners will seriously learn to walk in hands in hands with academic and research institutions, their efforts and plans will be unable to achieve the desired dreams, as ever before, thus, a strong advise to the practitioners to seriously take students in their search for empirical surveys, networking, legal research and implications. A continuous flow of assistance, let’s say after the class hours are over or during the week-end between you and us will benefit you in short term and us in medium term and to the nation in the long-term. You can invite GNLU to conduct survey how to reach out rural banking, which are the challenges, how the huge private capital wealth for which India and Gujarat, especially is known for, can be channelized to fund your operations and deficit and thus, instead of coming up with fraud balance sheets, can become reliable ones. Each and every banking institution has a unique set of goals and the legal and regulatory challenges are unique too, can you do it alone? I doubt, so involve on a daily basis researchers and students to do specific as well as long term research.
GNLU will be having a strong focus on corporate, banking, investment and competition during this semester. Our training program with Ministry of Corporate Affairs on corporate laws, with Competition Commission of India on Competition Laws in the next couple of months will aim to integrate debates happening in these important sectors of economy.
Finally, as we pray for rain and talk of green banking, we request our guests to spare few minutes to plant a tree before driving or being driven out of this 45 acres of campus built with most generous grant of the Gujarat Government led by the Hon’ble Chief Minister Mr Narendra Modi and one who is very keen that the GIFT will be soon realized and that GNLU will play an important role in terms of research, education and training for the GIFT. Today’s Times of India Edition Ahmedabad calls Gandhinagar greener of the greenest and I think with some additional trees planted by you, the host city can keep that “title” un-fetchable in decades to come.
Once again, we welcome you to the GNLU and thank Mr Kashyap, the Centre Director, the Organizing Committee for organizing this conference and hope that few concrete and practical ideas will be learnt from so many speakers and participants.
Thank you.
Bimal N. Patel,