On the demand side, a major economic transformation in India in the recent years has been the surge in rural demand which has now lower dependence on the farm sector. As per the National Sample Survey (NSS) data, the share of rural consumption in overall consumption was about 58 per cent in 2006–07.
If we look at the costs and benefits of the Basel III reforms to increase capital at financial institutions, we see that reforms impose costs on banks which may in part be passed on to their customers through wider spreads between deposit and lending rates – in turn generating some broader macroeconomic effects.