Commercial Banking Industry

Industrial sectors are the lifeblood of any economy and in India, where industry accounts for almost 80% of the gross domestic product (GDP), it is not surprising to see an upsurge in industrial activity. The demand for machineries and tools, textile products, petroleum products and many other industrial commodities is on the rise. The infrastructure in the sectors has also not been able to keep pace with the latest technology introduced in the market and this has resulted in production bottlenecks and production delays. In order to make things normal in the industry, there are several business minded people who have taken the initiative to start small businesses that are based on the manufacturing of machinery, accessories and other capital goods. These businesses are managed and run by the graduates that work under them. This allows the smaller entrepreneurs to establish a foothold in the industry without having to invest a huge amount of money initially.

However, with the slowdown in the economic cycles, the incomes of the smaller entrepreneurs are finding it difficult to keep their heads above water. The messina says that while this might be true, it does not mean that all hope is lost. The idea that small businesses cannot compete in the machineries and other capital goods sectors of the economy, might be a little off-putting for some people. But as the industrialists continue to invest in new technologies that provide them with better opportunities to earn profits, the number of bankruptcies will reduce.

Banking sectors are highly sensitive to the state of the real estate sector, which means that the impact of a slowing economy on this sector will be felt in the banking sector. If there is no investment in technology and infrastructure, there is a high chance of the sector going into decline. Since the demands of the banking sector include highly sensitive raw materials, the state of the economy might affect the demand of these raw materials, which can have a drastic effect on the profitability of the banks. Therefore, looking at the present state of affairs, it is clear that the missing sees plenty of scope for the industrial sector. This sector has the potential to contribute massively to the Gross Domestic Product (GDP) of any country, and hence is something that ought to be given due importance.