Making banks competitive

Updated: Feb 26 2005, 05:30am hrs
This is with reference to the FE story ‘Banks free to foray abroad, fix salaries’ (Feb 23). The decision to give state-run banks a freehand in their running is excellent. Banks will be able to close all their non-viable businesses. They will also have the authority to retain their talent so that they can compete with their private counterparts.

However, it will be necessary for these banks to improve customer service. For in today’s competitive world, good service is of utmost priority. This is the first step in the right direction of FDI in the banking sector.
Bal Govind


Unfair treatment
The finance minister should extend the service tax levy to services rendered in J&K. The Prime Minister has announced a package of Rs 24,000 crore for the state. The state has also sought Rs 100 crore from the Centre for the relief and rehabilitation of the avalanche victims. From where will all this money come
The FM intends to raise the service tax to 12%.Why should the rest of India pay service tax through their nose to sustain freebies for J&K Is the rest of India a colony of the state of J&K If the service tax levy cannot be extended to J&K, it should be scrapped for the rest of India too.
Srinivasan Anand G

Benefits all!
This is with reference to the news item ‘India Post seeks return to monopoly on letters (Feb 18). Barring courier companies from carrying letters need not be the only solution. During Portuguese rule in Goa, river navigation was considered a government monopoly. At that time, there were no bridges across the river Mandovi and most of the passenger and vehicular traffic from the capital city Panaji, to Verem on the other side, was by ferryboats belonging to the navigation department.
These ferries would leave once every 15-20 minutes or half an hour, but those who wished to cross over urgently could always do so by canoes which were readily available. The canoe owners were bound by law to first buy as many ferry tickets as the passengers they would carry, and these charges would be collected from the passengers along with the canoe fare. Somebody interested in urgent transit of letters who is willing to pay more should have the right to do so.
ND Dhond

Excess cess
Income tax payers have to pay a 2% education cess on the income tax paid by them. In addition, it is seen that service providers like insurance companies, courier services, auto services, photo printing services, in fact all those who charge 10% service tax, also recover this 2% cess from their customers. Thus, income tax payers end up paying the education cess many times over. Even their children and wives who have no income but use these services pay this cess.
Don’t service providers have an obligation towards the country’s literacy drive Why can’t these service providers pay the cess themselves instead of passing it on to customers Will the FM look into this
TT Krishnan