22.8        ndian     onom
     The distressed assests, in this way come back to     productions are high. Since crops arrive in the
     bank, may be with a lower profit element to them.    market during the busy season, prices generally are
          Such an announcement was made by the RBI        on the downward drift. It is the seasonal variation
     in 2014–15 allowing bullet repayment of loans        in the arrival of crops in the market, in the context
     extended against pledge of gold ornaments and        of steady demand, that causes prices to fluctuate
     jewellery for other than agricultural purposes.      during the year.
                                                               The above pattern has been severely modified
        bullion                                           in recent years. The government borrows both
                                                          during the slack and the busy seasons. Industry
     Precious metals such as gold, silver, and platinum   too is active in both the seasons. Because of greater
     that are traded in the form of bars and coins for    storage and stocking facilities, the variations in the
     investment purposes and are used for jewellery as    flows of agricultural products have been reduced.
     base metals.                                         Money supply expands continuously and prices
                                                          are generally up throughout.
        business cycle
     See the chapter with the same title.                    buyer’s mArket
                                                          A short period of market situation in which there
        busy AnD slAck seAsons                            is excess supply of goods/services forcing price fall
     The monetary authorities face the challenge of       to the advantage of the buyers.
     keeping the growth rate as high as possible, at
     the same time putting burden of adjustment on           buyouts
     luxury and unproductive consumption. Monetary        Private equity (PE) investors participate in two
     policy is an instrument in this respect. However,    types of buyouts of firms (a PE-backed buyout
     the right policies may not be palatable to the       simply means that the PE investor takes a
     political and fiscal authorities, which is a serious controlling stake i.e. between 50–100 per cent in
     problem for the economy.                             a company):
          From May beginning to end of September is            (i) Management Buyout (MBO): In such
     the slack season and from October beginning to                 buyouts, the PE investor usually helps the
     end-April is the busy season of the Indian Economy.            existing management of the company to
     During the slack season, crops are generally sown.             buy out the promoters of the company.
     Agriculture and related businesses are slack and               In return, the PE investor takes a majority
     loans taken during the previous busy season tend               stake.
     to be returned. Consequently, the growth rate of
                                                              (ii) Leveraged Buyout (LBO): In such buyouts,
     money is low or negative. Governments usually
                                                                    a large portion of fund in acquiring the
     borrow heavily during the slack season, since the
                                                                    company is financed by debt–the normal
     demand for credit from the commercial sector
                                                                    ratio being 70 per cent debt and 30 per
     is not very strong. Since there are no fresh crop
                                                                    cent equity.
     arrivals in the market and the demand for crops
     is steady, the prices are expected to be generally
     upward in the slack season.                             cAmels
          From October, the busy season commences         An acronym derived from the terms capital
     and both agricultural and related industrial         adequacy (C), asset quality (A), management