Is there a clear relationship between credit growth and market growth?

The fastest growing cities out of 112 top cities of India

 

Growth rates (CAGR)	Market Size Growth Rate	Deposit Growth Rate	Credit Growth Rate
Silvassa	23	14	71
Gandhinagar	22	10	54
Bokaro	19	7	-4
Surat	17	11	18
Thiruvallur	17	11	28
Agartala	16	13	32
Chandigarh	16	13	7
Thanjavur	16	5	20
Kohima	15	9	26
Noida	15	28	43

The slowest growing cities out of 112 top cities of India

 

Growth rates (CAGR)	Market Size Growth Rate	Deposit Growth Rate	Credit Growth Rate
Guntur	8	7	16
Gwalior	8	6	9
Jabalpur	8	3	0
Nellore	8	7	22
Varanasi	8	6	13
Kanpur	7	7	13
Kavaratti	7
Vijayawada	7	7	24
Dhanbad	6	12	15
Kancheepuram	2	16	22

With the exception of Bokaro, and to a certain extent Chandigarh, the 10 fastest growing cities grew on the back of high credit growth. However, this is not a general rule as a look at the slower growing cities reveal. Cities such as Vijaywada, Kancheepuram, Nellore and Guntur did not display a robust growth in spite of high credit growth. Deposit growth, on the other hand is an effect of market growth and in general grows in the wake of market growth. This is generally borne out by the facts, though a few notable exceptions exist – Thanjavur, Kohima, Bokaro (among the fast growing cities) and Dhanbad and Kancheepuram (slow growing cities)

data source: Indicus Analytics

The Double Tragedy of Bihar

It has been some time since the massive floods ravaged Bihar. Already it has disappeared from the front pages and the main media. That the disaster affected over 3 million people is a monumental tragedy. The second tragedy is more insidious – that these people do not matter. That is the reason it has receded from the front pages. The media and the people are merely confirming the facts. The facts are grim – the region affected does not matter on the economic map of the country. That is the second tragedy, one that has insidiously occurred over the last 60 years.

The key affected districts are – Araria, Madhepura, Purnea, Saharsa and Supaul. Some of these regions have had high profile representation in the political space too. These districts are extremely backward and hence agriculture is the mainstay (other sectors are virtually absent). The share of agriculture in the GDP of these districts is 44% (the All India share of agriculture is 19% and in Bihar it is nearly 30%). Other grim facts:

• These districts depend on agriculture but agriculture doesn’t depend so much on them – they account for just 16% of Bihar’s agriculture, which itself is just 5% of India’s agriculture
  
• Of the total GDP of the country, these districts have a share of just 0.3%
  

The total economy of these affected districts is so small that it is fair to say that they just about exist on the economic landscape. This is the bigger tragedy. These guys don't seem to matter.

"Does it take much of a man to see his whole life go down, To look up on the world from a hole in the ground, To wait for your future like a horse that's gone lame, To lie in the gutter and die with no name?

Only a hobo, but one more is gone, Leavin' nobody to sing his sad song, Leavin' nobody to carry him home, Only a hobo, but one more is gone"