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Has the Track been cleared …….for Policy Decisions, A Must for Economic Growth & Development

The counting of ballots and consequent declaration of results of Assembly General Elections 2012 held in five states of India on March 06, 2012 completed an important event in the process of Governance. Simultaneously, it also emphasized the importance of concept of Federalism for modern day democracy. On the other side of these developments, an increasing demand world over could be seen, India included, to incorporate or bring about a transformational change in the context to the ‘Governance’ issue.

It seems to be an apt time for revisiting to ensure that ‘Democracy’ as a system of governance adheres to its core attributes and the ‘Institutions’ erected to ensure its real spirit are capable of not alone performing the task, but also of representing the diversity, culture and socioeconomic issues and facets of the people, who have adopted such a system of governance.

It’s being expected by all concerned, that with culmination of Assembly General Elections 2012 of five states, functioning of Union Government would turn more efficient. Union government may now get free from the clutches of ‘Policy – Paralysis’ or ‘Stymied Decision Making Process’, which seemed to have become integral process of decision making by Union Government in Financial Year 2011 – 2012.    

Numerous issues of urgent importance, which were supposed to have been approved or rejected, are still there in cupboards of ministries, either awaiting their turn for being tabled in parliament, or are there in roll back mode awaiting the creation of elusive ‘consensus’. The post Assembly General Elections 2012 picture may not be pleasant to ruling coalition as Union Government, but it has certainly succeeded in putting an end to chaos, confusion or dilemmas born out of various presumptions and  self-fulfilling interests of a number of political parties.

The words, such as ‘Urgent’, ’Important’, ’Immediate’, ’Today ’and ‘Top Priority’ etc. have turned meaningless when seen in context of number of issues to be tabled, discussed and cleared or rejected by both the houses of Parliament, and also in the context of quantum of delay that has already occurred. Some issues out of them may be put, for purpose of illustration, as ‘FDI in Retail Sector’, ‘Direct Tax Reforms’, ‘Entry of Foreign Equity in Indian Airlines Industry’, ‘Issue of 4G Spectrum’, ‘Issue of Telangana’, ‘Creation of NCTC’, ‘Proposal on RPF’, ‘Issue of Inflation in Food Items’, ‘Deregulation of Prices of Petroleum Products’, ‘Land Leasing Bill or even Land Reforms Bills’, ‘Transforming Education in to Business’ and many more of the similar type.

The comments on issues are knowingly being avoided, as every single issue is important and also a subject matter to be covered in numerous articles, debates and deliberations. Certainly the same will be done, but the purpose here was to highlight the important issues pending approval of the parliament and also the evolution of Indian Political System and Governance as on date.

 

Always Yours —– As Usual —— Saurabh Singh

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US Prez Barack Obama as well as The rest of the world, too, is having nightmares about a possible US debt default

Last Seven Sleepless Night of United States President Mr. Barack Obama

The Reason Behind the Phenomenon has been detailed below in Issue and It’s possible reason Format.

What is the crisis about?

Since 1917, the US Congress has stipulated that there has to be a statutory limit on US public debt (debt of US federal govt). This limit has been periodically raised and now stands at $14.3 trillion (95% of the US GDP). The US will hit this limit on Tuesday, Aug 2, unless Congress approves a fresh hike. But the Republican-controlled House of Representatives and Democrat-controlled Senate haven’t been able to work out a consensus

Why are they fighting?

The Republicans want any debt limit hike linked to deep cuts in govt spending. They want the increase to be effective for a year, with fresh discussions after that. The objective is obviously to make it an issue ahead of the 2012 presidential elections. Democrats favour tax increases and a one-shot raising of the ceiling. They are also opposed to any cuts that could jeopardize the economic stimulus and welfare payments

What happens if debt ceiling is not raised?

US govt can’t pay     employees, social security benefits, defence contractors, medical insurance bills and interest to lenders. Credit rating will plunge from top ‘AAA’ to bottom D’
What will be the global impact?

Govts, investors and businesses across the world will stop investing in US bonds. There will be panic in financial markets globally, with investors exiting equities for safe havens like liquid cash and gold

Does it affect India?

Indirectly, though much less than countries/blocs with big trade and debt dealings with US, like EU and China. Still, a worldwide downturn could hit Indian exports and FDI flows

When did this debt accumulate?

 Barack Obama (fighting recession, wars in Afghanistan and Iraq) $2.4tn

George W Bush (wars and tax cuts) $6.1tn

Bill Clinton $1.4tn

George Bush $1.5tn

Ronald Reagan $1.9tn

Earlier $1tn

Whose money has the US taken?

Foreign countries (including China $1.2 tn) $4tn

US public and cos $3.6tn

US federal system $6.2tn

 

Always Your — As Usual Saurabh Singh

Draft Lokpal Bill Ready for Consultation with Citizen of India – Comments Requested

The drafting of the Jan Lokpal bill, which is to be finalized by June 30th, 2011, is underway. You can play your part in this historic moment by giving your invaluable comments/suggestions about the different provisions in the draft of the Jan Lokpal bill which will make it the effective, accountable and independent anti-corruption body that India needs right now. Otherwise, it will remain a law which exists only on paper and has no impact on the ground. Please provide your comments. The provisions and options for submitting comments are as detailed below:

  • Online : To fill your comments directly in the form on the Website it hosted Click Here
  • Email : Send us an email at lokpalbillcomments@gmail.com
  • Postal mail : Mail your comments to the following address
        Lokpal Bill Public Consultation
        A-119, Kaushambi
        Ghaziabad – 201010

To download the Full Text Draft of Jan Lokpal Bill Version 2.2 Click Here 

To download English Summary of Jan Lokpal Bill version 2.2 Click Here

[To Read These Documents You Will Require a Adobe Reader. It can be downloaded free from Adobe’s Website]

Your Participation is must…..Do not forego such Options…..This will help in bringing Good governance.

Expecting your full hearted participation…As it is basically non participation of learned and intelligence Citizen which Force Gifts a  Member of Parliament or Member of Legislative Assembly, who may not be most competent of all who are contesting polls. So, please let not the same happen again, and prove this by submitting your Comments or at least even by glancing through it.

Always Yours — As Usual — Saurabh Singh


New World Order Imminent!- Anyone For A Game Of Ping Pong?

This vedio has been uploaded for my learned audiences, fans, students and scholars and rest others, who wish to understand issue of New World Order. I would top up the same by a commentry on Asian Environment Soon. Hope you find some value in it.Always Your—– As Usual — Saurabh Singh

Vodpod videos no longer available.

 

War amongst two Organs of same Body: Did Somebody Say Cannibalization: Is it Suicidal?

Market regulator SEBI has barred 14 private life insurance companies from selling unit-linked insurance plans without its approval, giving a fresh twist to the turf war between SEBI and insurance watchdog IRDA.

“We expect some companies to move the court” said the CEO of a life company. “It is unfortunate that this dispute has been allowed to reach this stage. It is time for the finance ministry to intervene” he added.

In an order signed by Prashant Sharn, wholetime director, SEBI, said, “I hereby direct the entities mentioned in this order not to issue any offer document, advertisement, brochure soliciting money from investors or raise money from investors by way of new and/or additional subscription for any product (including ULIPSs) having an investment component in the nature of mutual funds, till they obtain the requisite certificate of registration from SEBI.”

The 14 companies mentioned in this order include Aegon Religare, Aviva, Bajaj Allianz Life Insurance, Bharti AXA, Birla Sun Life, HDFC Standard Life, ICICI Prudential, ING Vyasa Life, Kotak Mahindra Old Mutual Life, Max New York Life, Metlife India, Reliance Life, SBI Life, TATA AIG Life.

A few months back, SEBI had questioned individual life companies why they were selling investment products without its approval. Companies had responded individually that insurance laws permit them to offer an investment component within a life insurance policy. They also said that they were regulated by SEBI who had cleared all these products. The life companies were supported by the market regulator, who reiterated the stand taken by life companies.

In its final order SEBI said, “I find that the entities by their own admission have stated that there are two components of ULIPSs – an insurance component where the risk on the life insurance portion vests with the insurer and the investment component where the risk lies with the investor. This establishes conclusively that ULIPSs are a combination product and the investment component need to be registered with and regulated by SEBI”

SEBI’s order has implications not only for the life insurance companies but also for their promoters who have sunk in over Rs 26,000 crore in the form paid up capital. According to analyst reports, a significant portion of the value of various companies including, ICICI Bank, Aditya Birla Nuvo, SBI Life and Bajaj Fin serve. Most of the business written by these companies is through ULIPSs. If these companies are barred from selling ULIPSs, their valuations are likely to be hit.

Atul Surana , Certified Financial Planner and MD of Catalyst Financial Planning, says, “Anybody will understand one clear partial stand of SEBI which has not included LIC’s name in the list of life insurance companies selling ULIPSs. Secondly, this sounds much like a war between IRDA and SEBI who are bent on proving their authorities. These two regulators could have sorted out the issue on regulatory process first and then issued the order!”

So far as the order’s negative implications are concerned, experts say that while they broadly agree with the concerns of the regulator, it is also important to look at some possible negative implications of this move.

For instance, this process of another regulatory approval might take away the sheen from these products. Insurance companies may not be inclined.  The Securities and Exchange Board of India’s latest order on ULIPSs is expected to have far-reaching implications for the concerned life insurance companies as well as investors. SEBI has issued a directive to all private life insurance companies not to issue any offer document or advertisement soliciting money from investors for a ULIPS or any product having an investment part in the nature of mutual funds, till they approve of the same.

This directive is the latest in a series of initiatives taken by the market regulator to put an end to all unfair market practices and make the process of investments simple, fair and cost efficient for an investor. While the immediate fallout will be negative for all the 14 private life insurance companies as ULIPSs form a major part of the new business written by these companies in the recent past, yet some financial experts feel that this is a welcome step as it puts an end to the unfair practice of pushing life insurance policies as investment products to gullible investors.

“In the current market practice investors end up paying very high charges for the investment part of these policies and are usually not aware of the expenses they are paying. This is because unlike a normal share or mutual fund investment there are usually a myriad of charges in a ULIPS product hidden behind numerous provisions and clauses which are sometimes not easy to comprehend even by insurance professionals,” says Ashish Kapur, CEO, Invest Shoppe India Ltd, adding, “hence common investors have very little chance of ever getting an accurate picture of the costs they are incurring on these insurance and investment combination products.”

Still all is not well with the SEBI order as it is believed to have some partiality besides having some negative implications to offer these products if the regulations are very tough and costly to comply with.

FRIENDLY FIRE: EXPECTED NUMBER OF CASUALTIES

SEBI’s order asking 14 insurance companies to stop selling unit-linked insurance plans has turned into full-fledged regulatory battle with the Insurance Regulatory and Development Authority issuing its own order directing the 14 companies to continue selling ULIPSs.

“After due consultation with the members of the consultative committee all the 14 insurance companies which are mentioned in the order of SEBI are directed to note that notwithstanding the said order of the SEBI, they shall continue to carry out insurance business as usual including offering, marketing and servicing ULIPSs in accordance with the Insurance Act 1938” IRDA said in a late evening order on Saturday signed by chairman J Harinarayan.

In the order IRDA observed that SEBI’s order would upset financial stability, jeorpardise policy holders interest and was prejudicial to the interest of insurers. The 14 companies mentioned in this order include; Aegon Religare, Aviva, Bajaj Allianz Life Insurance, Bharti AXA, Birla Sun Life, HDFC Standard Life, ICICI Prudential, ING Vyasa Life, Kotak Mahindra Old Mutual Life, Max New York Life, Metlife India, Reliance Life, SBI Life, TATA AIG Life.

“The IRDA Act `99 is specifically enacted to provide for an authority to protect the interests of holders of insurance policies, to regulate, promote and ensure the orderly growth of the insurance industry” IRDA said. The insurance industry was greatly relieved by IRDA’s order. “It is now between the regulators who have to settle this among themselves” said a senior industry official.

SEBI’s order has more far reaching implications than a press release or a circular. Since the order has been issued under Section 34(i) (a) and (b) of the insurance Act. IRDA has said that in the year `08-09 ULIPS policies involving a total premium of Rs 90,645 cr were in force. In fiscal `09-10 upto February 16.7 lakh policies have been sold with a premium of Rs 44,611crores. “It is also observed that the 14 insurance companies have an equity capital of Rs 16,281cr as on March 2009” IRDA said.

The insurance regulator said that observance of SEBI’s order would cause the stoppage of all renewals of insurance policies already invested by the insuring public may result in forced premature surrender of insurance policies causing substantial loss to the policyholders and to the insurers. “The effective stoppage of the sale of the products would cause a complete drying up of revenue flows to the insurance companies which could disrupt the payment of benefits on maturity, on death and on other admissible claims, putting the policyholder and the general public to irreparable financial loss. The financial position of the insurers will be seriously jeopardized thus destabilizing the market and upsetting financial stability” IRDA said.

IRDA IS FIRST TO BLOW CONCH – DIN’T YOU HEAR THE WAR CRY

SEBI’s order asking 14 insurance companies to stop selling unit-linked insurance plans has turned into full-fledged regulatory battle with the Insurance Regulatory and Development Authority issuing its own order directing the 14 companies to continue selling ULIPSs.

“After due consultation with the members of the consultative committee all the 14 insurance companies which are mentioned in the order of SEBI are directed to note that notwithstanding the said order of the SEBI, they shall continue to carry out insurance business as usual including offering, marketing and servicing ULIPSs in accordance with the Insurance Act 1938” IRDA said in a late evening order on Saturday signed by chairman J Harinarayan.

In the order IRDA observed that SEBI’s order would upset financial stability, jeorpardise policy holders interest and was prejudicial to the interest of insurers. The 14 companies mentioned in this order include; Aegon Religare, Aviva, Bajaj Allianz Life Insurance, Bharti AXA, Birla Sun Life, HDFC Standard Life, ICICI Prudential, ING Vyasa Life, Kotak Mahindra Old Mutual Life, Max New York Life, Metlife India, Reliance Life, SBI Life, TATA AIG Life.


“The IRDA Act `99 is specifically enacted to provide for an authority to protect the interests of holders of insurance policies, to regulate, promote and ensure the orderly growth of the insurance industry” IRDA said. The insurance industry was greatly relieved by IRDA’s order. “It is now between the regulators who have to settle this among themselves” said a senior industry official.

SEBI’s order has more far reaching implications than a press release or a circular. Since the order has been issued under Section 34(i) (a) and (b) of the insurance Act. IRDA has said that in the year `08-09 ULIPS policies involving a total premium of Rs 90,645 cr were in force. In fiscal `09-10 up to February 16.7 lakh policies have been sold with a premium of Rs 44,611crores. “It is also observed that the 14 insurance companies have an equity capital of Rs 16,281cr as on March 2009” IRDA said.

The insurance regulator said that observance of SEBI’s order would cause the stoppage of all renewals of insurance policies already invested by the insuring public may result in forced premature surrender of insurance policies causing substantial loss to the policyholders and to the insurers. “The effective stoppage of the sale of the products would cause a complete drying up of revenue flows to the insurance companies which could disrupt the payment of benefits on maturity, on death and on other admissible claims, putting the policyholder and the general public to irreparable financial loss. The financial position of the insurers will be seriously jeopardized thus destabilizing the market and upsetting financial stability” IRDA said.

POLICE DECIDES TO TURN SPECTOR

The finance ministry today kept a safe distance from the ongoing row between market regulator SEBI and insurance watchdog IRDA over ULIPs, saying the two regulators have to resolve the issue.

“It’s a matter between regulators; so they have to decide,” finance secretary Ashok Chawla told when sought his comments on yesterday’s SEBI decision to ban 14 life insurers from raising any more money from the unit-linked insurance plans (ULIPs) in which a portion of the premium amount is invested in stock markets, a move opposed by the insurance regulator.

The SEBI decision was taken after the market regulator had sent notices to these companies asking them as to explain why they did not take its permission to launch these schemes.

Insurance regulator IRDA is understood to have stated in its reply that regulation of ULIPs by IRDA is well-laid down and that it does not agree with SEBI contention that insurers need a certificate of registration from the market regulator for dealing in ULIPs.

The issue was also taken up at the meeting of the inter-regulatory body, the High Level Coordination Committee (HLCC). It was decided at the meeting that the two regulators should settle the issue between themselves.

Chawla said the SEBI and IRDA have not so far been able to come to any resolution. “So, SEBI has taken a legal process. He was going to be silent spectator to see the fire power of both Regulators.

 

Always Yours   — As Usual — Saurabh Singh, India

[Thanks are expressed for too many peple]

India’s Events that Covered Head Lines in 2009 Media

As Ever A Happening Year but with many Negative Shades still Promising A Bright Future Ahead

SLOWDOWN

It was a year of turbulence for India Inc and the economy. While many sectors like realty, textiles plunged into darkness on the back of a global recession, there was a ray of hope in some other sectors like the telecom. The year also saw India’s biggest corporate fraud, falling earnings, stock market crash, job losses and soaring food prices which hit the common man. However, towards the end of the year, the economy started showing signs of recovery.

The stimulus packages started giving results with the economy growing by 7.9 per cent in the second quarter of this fiscal, the highest growth in six quarters. The Indian economy is likely to grow between 7 per cent and 7.5 per cent during the current financial year despite poor performance of the agriculture sector due to drought and floods. India’s exports and industrial growth have also turned around raising hopes of a better year ahead.



Slowdown banner

Slowdown or Not

SATYAM SCAM

The year 2009 began on a shocking note with Satyam founder Ramalinga Raju admitting to siphoning off over Rs 7,000 crore (Rs 70 billion) from the company. It was the biggest corporate fraud in India. The Central Bureau of Investigation (CBI) has now pegged the Satyam fraud at Rs 14,000 crore (Rs 140 billion) instead of the Rs 7,800 crore (Rs 78 billion) that Raju had admitted to in January this year. Satyam Computer Services was founded by Raju in 1987. The crisis-hit company has been taken over by the Mahindra group and renamed Mahindra Satyam. Vineet Nayyar is the chairman of Mahindra Satyam.

Satyams ill famed directror Raju Ramlingam

Satyams ill famed Directror Raju Ramlingam

Raju, who turned 55 on September 15, has been in jail since January, 9. Raju is now being treated at the Nizam’s Institute of Medical Sciences (NIMS).  He was earlier diagnosed with Hepatitis C and heart ailments. Raju’s brother B Rama Raju, chief financial officer Vadlamani Srinivas, three other employees of Satyam and two auditors are also in jail. They have been charged with cheating, forgery and criminal conspiracy.

INFLATION SWINGS GOLD , FOOD PRICES

The food prices in India hit a 10-year high of 20 per cent for the year till December 5, due to demand-supply mismatch and worst monsoon in 37 years, which affected the kharif crop output. India’s annual rate of inflation, based on wholesale prices, rose sharply to 4.78 per cent in November from 1.34 per cent in the previous month, mainly on account of a 16.71 per cent jump in prices of food articles. Rising prices of food items, jet fuel and alcohol pushed up inflation to 5.64 per cent in January 2009.

In June, inflation in India turned negative 1.61 for the first time in 32 years but the prices of food items like fruit and vegetables, cereals and oil were still higher than last year.

A Grocery Shop Selling Pulses

A Grocery Shop Selling Pulses - Prices hit by Inflation

Meanwhile, the food inflation decreased to soften to 18.65 per cent for the week ended December 12, though essential items like potato and pulses continued to remain expensive.  Potato prices have zoomed by 136 per cent and pulses by over 40 per cent in the last one year.

MONTHLY INFLATION FIGURES

From now on, India will present inflation figures on a monthly basis instead of the existing weekly system. Analysts say since weekly data on wholesale price index-based inflation do not adequately capture the movement of prices of manufactured goods, government has to often revise the figures later.

GOLD PRICES ZOOM

Gold prices closed at all-time record of over Rs 18,000-per ten gram in November 2009 on the back of a strong marriage season demand, positive global cues and a weaker dollar. Gold touched a all-time high of Rs 18,550 per 10 gm. Gold prices rose by 13 per cent since the beginning of this November after the Reserve Bank of India announced it had bought 200 tonnes of bullion from the International Monetary Fund. Retail investment demand for gold has zoomed by 515.8 per cent to 109 tonnes in the second quarter (April-June) of 2009 from 17.7 tonnes in the first quarter. India consumes nearly 30 per cent of the world’s annual gold production. This is slated to increase by 36 per cent to 980 tonnes by 2010 according to the Indian Chamber of Commerce.

UNION BUDGET 2009 – 10

Stating that ‘aam aadmi’ is the focus of all the government programmes, Finance Minister Pranab Mukherjee proposed the following measures in Union Budget 2009-10

  • Personal income tax exemption limit for senior citizens raised by Rs 15,000.
  • The exemption limit for income tax for women raised by Rs 10,000 to Rs 190,000.
  • For all others, exemption limit raised by Rs 10,000 from Rs 150,000.
  • No change in corporate tax.
  • IT returns to be made simpler.
  • Fringe Benefit Tax abolished.
  • Minimum Alternate Tax on book profits increased to 15 per cent from 10 per cent.
  • Commodities Transaction Tax abolished.
  • 100 per cent tax deduction for donations for electoral funds to improve transparency in political funding.

One of the biggest taxation reforms in India — the Goods and Service Tax (GST) — is all set to integrate state economies and boost overall growth.

Union Minister for Finance during Budget Speech

Union Minister for Finance during Budget Speech

GST will create a single, unified Indian market to make the economy stronger. Pranab Mukherjee while presenting the Budget on July 6, 2009, said that GST would come into effect from April 2010.

DIVESTMENT – A GREAT MONEY SPINNER

Divestment is the government’s mantra to earn big bucks at a time when the country is feeling the ill-effects of the global financial crisis. Now that the Left parties are not a part of the United Progressive Alliance-II, the government has put divestment of public sector units on the fast track.

Money and its Game

Disinvestment -- A Money Spinner

The Centre is likely to prepare a blueprint for its divestment process for the next two years by the end of this financial year. At present, there are 61 unlisted profit-making public sector undertakings and 10 listed PSUs where the government could look to dilute its stake. It plans to raise over Rs 25,000 crore (Rs 250 billion) in 2009-10, which will help to cut down fiscal deficit and the expansion of public sector enterprises.

THE SPECTRUM SAGA

The much awaited auction of spectrum for 3G mobile services is likely to be delayed by more than a month and may commence from the first week of March next year. The schedule will be announced soon. The revised schedule is being worked out taking into account the outcome of last meeting of an Empowered Group of Ministers where defense ministry agreed to vacate spectrum.

Meanwhile, the spectrum row, termed as independent India’s largest financial scam, is centered on the allocation of scarce 2G spectrum at throwaway prices. Accusing Union Telecom Minister A Raja of orchestrating a Rs 60,000 crore (Rs 600 billion) scam, the opposition parties — Bharatiya Janata Party and Communist Party of India (Marxist) had asked the government to fire the minister and institute probe into the alleged irregularities.

Union Telecommunication Minister A. Raja

Union Telecommunication Minister A. Raja

The government had in 2007 recommended an ‘open license regime’. ‘Applications for telecom licenses were invited setting Oct 1, 2007, as the deadline. An artificial cut-off date, Sep 25, 2007, was created and applications received between Sep 25 and Oct 1 were summarily rejected. Rules of the game were changed after the game had begun,’ the BJP charged. The BJP alleged that ‘all friendly applicants, mostly real estate companies, had been advised to put in their applications before Sep 25’.

The licences and the spectrum allocation were then allotted to nine operators at a price of Rs 1,650 crore (Rs 16.50 billion) per operator. This price was not taken on the basis of the 2007 market value but on the basis of an auction held in 2001. The value of the licence and spectrum in 2007 could not be the same as in 2001 as the telecom market has grown phenomenally during this period. However, Prime Minister Manmohan Singh said allegations about the scam were incorrect. The prime minister had earlier expressed his reservations about inducting A Raja in the Cabinet.

MERGERS & ACQUISITION’S

Making strong inroads in the global acquisition arena, Indian companies continued to win big ticket deals and acquisitions.

BHARTI – MTN DEAL

This year Bharti Airtel was all set to take over South Africa’s MTN. It would have been India’s biggest-ever M&A deal but months later, the talks failed and the $23 billion deal was called off.

WIPRO BUYS YARDLEY’S ASIA BIZ

Wipro buys Yardley's Asia biz

Wipro buys Yardley's Asia biz

In a $45.5 million (Rs 215 crore) deal, Wipro took over 229-year-old British brand Yardley’s business in select markets including India from UK’s Lornamead Group to stretch its personal care portfolio to the premium range.

LUPIN BUYS PHILIPPINES DRUG FIRM

Drug maker Lupin acquired Multicare Pharmaceuticals Philippines Inc. for an undisclosed sum in March 2009. This is Lupin’s sixth acquisition in 18 months.

ONGC BUYS IMPERIAL ENERGY

The Oil and Natural Gas Corp took control of Imperial Energy Plc for $2.8 billion, in January 2009, after an overwhelming 96.8 per cent of London-listed firm’s total shareholders accepted its takeover offer.

MEGA INFRASTRUCTURE PROJECTS

Bandra-Worli_Sea-Bridge

Bandra-Worli_Sea-Bridge

BANDRA – WORLI SEA LINK

An engineering marvel and the first-ever open sea bridge of its kind, the Bandra-Worli Sea Link is one of the most complex and advanced construction projects ever to have been undertaken in India. The Rs 1,634-crore (Rs 16.34 billion) project of the Maharashtra State Road Development Corporation has been executed by the private engineering and construction major, Hindustan Construction Company.

DELHI METRO

Delhi Metro made further progress when a brand-new train chugged into the satellite city of Noida for the first time paving the way for thousands of commuters in east Delhi and adjoining areas to enjoy the new age transport system. The Noida corridor, built at a cost of Rs 630 crore (Rs 6.30 billion), is completely elevated and will be integrated with the existing 34.3 km Yamuna Bank-Dwarka Sector-9 segment, extending the total length of Line-3 to 47.4 km.

AIRPORTS

The state-of-the-art integrated terminal, called T3, of Indira Gandhi International Airport in New Delhi is poised to be the world’s second-largest, after Beijing in China, in terms of size. The terminal, built at a cost of Rs 8,996 crore (Rs 89.96 billion), has four boarding piers with 48 boarding gates and 78 aerobridges, which is the highest for a terminal of its size.

LONGEST FLYOVER

India’s longest flyover with a length of 11.66 km was opened in Hyderabad in October. The flyover was built over a period of about three years at a cost of Rs 600 crore (Rs 6 billion), using the latest technology of prefabricated segment and overhead grid launcher, causing minimal disruption to the traffic along the route.

INDIAN AUTO SECTOR BOOMS

It is raining cars in India. The passenger car sales in India soared 61 per cent in November on the back of improved consumer sentiment, easier finance and low sales base, according to the Society of Indian Automobile Manufacturers (Siam).

Auto companies sold 1,33,687 cars in November compared to 83,121 units in the same month last year. About 40 new car models were launched in the market over the past year. India has now become the second-largest maker of small cars, overtaking Brazil.

Nano Car from House of TATA

Nano Car from House of TATA

The world’s cheapest cars, the Tata Nano was launched in March this year. In two months, the Tatas received over 203,000 fully paid bookings amounting to nearly Rs 2,500 crore (Rs 25 billion).

BAJAJ BIDS FAREWELL TO SCOOTERS

Three months from now, Bajaj will bid farewell to scooters. From selling over a 100,000 units every month, the company now manufactures only 1,000 scooters. Bajaj Auto which revolutionized the nation’s scooter market said it will stop production of Kristal by end of the current fiscal.

AIRLINES HIT BY TURBULENCE


It was a year of losses and strikes for the airline industry. The combined losses of all airlines in 2008-09 were over Rs 8,000 crore (Rs 80 billion).  The operations of Jet Airways and Air India were hit for several days as their pilots went on strike in September to protests against a cut in performance-linked incentives.

Striking Air India Employees

Striking Air India Employees

A drop in traffic, revenues, high fuel costs further added to their woes. According to the International Air Transport Association (IATA), the Indian aviation industry, which accounts for two percent of air traffic worldwide, accounts for 11 percent of global losses.

Jet Airways, Air India, Kingfisher Airlines and low-cost carriers are now planning to hike air fares by up to 25 per cent in January.

THE RISE AND FALL OF MARKETS

The Sensex created history when it crossed the 21K-mark in January 2008, however,  a year later it crashed. In January 2009, the Sensex saw its biggest intra-day fall when it hit a low of 15,332, down 2,273 points. However, it recovered losses to some extent and closed at a loss of 875 points at 16,730 on Januray 22, 2009. On December 29, the Sensex rose by 0.24 per cent to its highest close at 17,401 in 19 months on December 29.

Sweden's Crown Princess Victoria poses with Bull

Sweden's Crown Princess Victoria poses with Bull -- Probably feeling Bullish on India

On May 18, 2009, the Sensex surged 2110.79 points from the previous closing of 12174.42 this leading to the suspension of trade for the whole day. The Sensex is expected to trade at a historical average P/E of 15 by the end of the financial 2010-11 as foreign and domestic equity analysts expect India Inc’s net profit to grow 25-30 per cent in 2010-11.

FAKE CURRENCY

The government has admitted that the problem of fake currency was ‘alarming and dangerous’ as some groups are trying to destabilize the Indian economy by injecting massive doses of counterfeit notes in the country. The secret template India uses to print currency notes has been ‘compromised’ and that is possibly why fake but real-looking Indian currency notes are being pumped in, the Central Bureau of Investigation said.

The CBI, the nodal agency for checking fake notes, has now formed a special team comprising its sleuths and officials from the Directorate of Revenue Intelligence, the Reserve Bank of India and the Central Forensic Science Laboratory to find out how and at what level the design got ‘compromised’. According to the CBI, the counterfeiters have deep knowledge about the kind of special ink, paper and other ingredients that go into the making of notes.

PLASTIC NOTES

The Reserve Bank of India is toying with the idea of replacing paper currency with polymer notes. As a pilot project, the central bank is said to have decided to introduce 100 crore (1 billion) pieces of Rs 10 polymer notes, for which the bank has floated a global tender. The bank has asked interested parties for 500 pieces of sample banknotes, before the actual global bids for the project go through.

Teller Machine Counting Currency Notes-- INR

Teller Machine Counting Currency Notes-- INR

THE COPENHAGEN SUMMIT

On December 7, officials from 192 countries attended the world’s biggest summit on climate in Copenhagen to tackle the challenges of climate change. However, the Copenhagen climate talks failed to deliver a legally binding agreement to tackle global warming. Countries like India, Brazil, China, and South Africa joined hands with President Obama to form the Copenhagen Accord.

The accord commits to cut greenhouse gas emission in each country but the Accord is not yet a legally binding treaty and failure to achieve emission reductions will not be penalized

“Climate change cannot be addressed by perpetuating the poverty of the developing countries,” Prime Minister Manmohan Singh had said. Environment Minister Jairam Ramesh told Parliament recently that the country would reduce its ‘carbon intensity’ — the amount of carbon dioxide emitted for each unit of gross domestic product — by up to 25 per cent from 2005 to 2020.

Climate change and environmental degradation will force as many as one billion people to migrate over the next four decades to Southeast Asia, central America and parts of west Africa.

Mumbai Traffic came to a Standstill following Heavy Rains

Mumbai Traffic came to a Standstill following Heavy Rains

GREAT YEAR FOR TELECOM

The telecom sector continued to ring louder in 2009. The economic slowdown did not hamper its growth. The telephone subscribers were a happy lot with a number of new mobile operators, like Tata DoCoMo, Unitech Wireless, MTS and STel, making a foray into the booming market. The intense competition led to a tariff war, with operators offering tariffs on per second basis. There was drop in roaming and STD tariffs as well. The mobile subscriber base grew from 346 million in December 2008 to 506 million by November 2009.  However, the much-awaited introduction of Mobile Number Portability and third generation (3G) mobile services has been delayed.

CRACKDOWN ON CELLPHONES WITHOUT IMEI CODE

The telecom ministry disconnected mobile phones without the IMEI (International Mobile Equipment Identity) code. Concerned over the threat to national security, the Department of Telecom had asked operators to crack down on illegal and China-made cheap handsets, which do not bear any IMEI code. It is estimated that there are about 25 million handsets without IMEI number. Delhi Police have seized over 3,500 mobile phones without unique identity numbers, mainly imported from China.

Telecom Sector Booms

Telcom Sector Boom

DUBAI CRISIS

The glittering Dubai image took a beating in 2009. The Dubai government’s announcement seeking a six-month reprieve on debt repayments sent shockwaves through the world markets, as it raised doubts over the Gulf emirate’s ability to meet its financial obligations. The Dubai government requested the creditors of Dubai World (one of three conglomerates that are backed by the emirate), to agree to a ‘standstill’ on repayments until May 30 2010.

The Dubai crisis is likely to hit exports, remittance, banking and real estate sector in India. Exports are going to be the most affected, as the UAE is now India’s largest export hotspot.

Bullion trading in Dubai is likely to be affected. The financial crisis in Dubai will not affect India but may prompt investors to take a relook at emerging markets, according to World Bank President Robert Zoellick. Indians who constituted 42.3 per cent of the UAE’s labour force in 2008 are also likely to be affected with several jobs being slashed.

Burj Tower, Dubai

Burj Tower, Dubai

NILEKANI, MURTHY IN NEW ROLE

Infosys co-founder Nandan Nilekani quit Infosys to head the government’s ambitious unique identification project (UID). Nilekani said he would start issuing the unique number by February 2011. Stating that it was a huge challenge to make sure that there is no duplication. Biometrics will be used to prevent duplication. The project estimated to cost around Rs 30,000 crore (Rs 300 billion) will offer identity card to all citizens.

Nandan Nilekani

Nandan Nilekani

MURTHY TURNS VENTURE CAPITALIST

N R Narayana Murthy now wants to help budding entrepreneurs. He has initiated the first step towards starting a venture capital fund focussed on India. The fund will encourage and support young entrepreneurs who have brilliant business ideas. The Infosys chairman offloaded 800,000 shares from his personal holding, to raise about Rs 177 crore (Rs 1.77 billion) a few days ago to start Catamaran Venture fund. The fund will primarily invest in India, though it might consider investing overseas on a ‘case-to-case basis’.

AMBANI WARS

The Ambani brothers continued to hog the limelight in 2009. Even four years after splitting the Reliance Empire, the Ambani brothers still seem to be washing dirty linen in public: the latest battle is over gas pricing. Mukesh and Anil Ambani are at loggerheads again over a gas-supply agreement that was made when the Dhirubhai Ambani-founded Reliance group was split in 2005.  The gas sale master agreement between Reliance Industries Ltd and Reliance Natural Resources Ltd states that the latter (RNRL) is entitled to be supplied 28 million cubic metres of gas a day from the Krishna-Godavari (KG) basin at a price of $2.34 per million British thermal unit (mBtu) for a period of 17 years.

Mukesh and Anil Ambani in Happier Times

Mukesh and Anil Ambani in Happier Times

Accusing RIL of using of delaying gas supply to the power projects of ADA Group and NTPC by a minimum of four years, RNRL said: “RIL is selling 40 million cubic meters of gas per day committed to NTPC and RNRL to third parties at $4.20 mmBtu and making super normal profit of over Rs 20,000 crore (Rs 200 billion), being the difference between $4.20 mmBtu and $ 2.34 mmBtu.

If you go by the NTPC draft agreement which the RNRL says is the template agreement for the supply of gas then there exists a clause that the price of the gas is subject to the government approval,” RIL’s counsel Harish Salve said.

Meanwhile, the government counsel said the issues involved were not between two parties. Gas from the Krishna-Godavari (K-G) basin was a natural resource belonging to the government. As the custodian of public interest, the government has asked the empowered group of ministers to fix an equitable price and it was doing so with the help of experts. The price of gas and other vital matters cannot be the subject of the fight between two persons.

—–Always Yours as Usual—-Saurabh

Note: The info has been posted for academic use only. This has no commercial value. Specially hosted for consumption of students so as to remain updated of major events and their Impact on markets. I acknowledge the portal Rediff.com and other media for source.

Welcome you all to and the New Year 2010

WISHING YOU AND YOUR FAMILY A VERY HAPPY AND PROSPEROUS NEW YEAR

WISHING YOU AND YOUR FAMILY A VERY HAPPY AND PROSPEROUS NEW YEAR

Global Trade in Herbal Medicines : An Indian Perpective - Cover Pages

Global Trade in Herbal Medicines : An Indian Perpective - Cover Pages

I Keep Thinking About:

“Why majority of social scientists often try to turn mathematicians, which they are not and neither it’s expected of them…Gentlemen you are expected to have Mastered humanities …society won’t take mathematical equations in exchange…equations will be taken as…adding salt to injury …if you do so…You are the one who destabilized the fine balance of Psycho-Socio-Economic elements of Humanity…we can hire a lot of Mathematics graduates…But Philosophers, Thinkers, Social Scientists are Rare Creations of Almighty…We are Searching them Pan Disciplines identified till Date.”

“Want to keep Yourself Updated about Saurabh’s Every move ! — Then Click The Google Button Just Below. It would do the Job, So Now You can Relax.”

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Finance in History

Dear Learned Audiences,

History is not just a forte of Kings, Emperors, Social Workers, Leaders and so on only. It keeps on silently recording the numerous developments happening in the various spheres of learning too. Sometimes, it may be in the form of thought other day it may be principles and following day may be for practices.

Finance in History

If you are doomed to repeat history, let’s hope you can pick your era. Once upon a time, business bankruptcies resulted in jail time (if you were lucky), treasurers defended their funds with a sword, and financial planning was tested by plagues and fire. Things improved during the American Revolution, when the father of our country also proved to be one of its best bookkeepers. But accounting couldn’t keep up during the Industrial Revolution, with disastrous consequences for workers. If you tend to think of history as the third quarter of the last fiscal year, it may be time to learn a little bit more about your profession’s checkered past.

The 17th-century business world revealed in Samuel Pepys’s famous diary is not so far removed from our own.

“Most happy in the keeping of all my accounts, for that after all the changings and turnings necessary in such an account, I find myself right to a farthing in an account of 127,000 pounds.” — Samuel Pepys’s diary entry, August 20, 1666

Public officials in 17th-century England had not yet refined the notion that one has to pay to play; that is, pony up political contributions to obtain government contracts or favors. But when Samuel Pepys was an important naval administrator in London during the mid-1660s, the basic idea was well understood. Like others similarly situated, Pepys gladly accepted gifts, and he recognized the debt he incurred in accepting them.

We know this from reading Pepys’s diary, regarded by many as the greatest in the English language. Between January 1, 1660, and May 31, 1669, Pepys (rhymes with “keeps”) chronicled his everyday life, from his professional concerns to his sexual escapades, from the state of the financial accounts he kept to the painful progress of his kidney stone. The practice of diary keeping began to catch on during the 17th century, according to Pepys biographer Claire Tomalin. But his is prized for its confessional insights, large cast of characters, accounts of significant events, and entertaining narrative, combining to reveal a singular sensibility.

“What is extraordinary is that he went into areas no one else considered recording, looked at himself with as much curiosity as he looked at the exterior world, weighing himself and the world equally in the balance,” observes Tomalin in Samuel Pepys: The Unequalled Self (2002). Writing for his eyes only, Pepys used a private shorthand and, in especially delicate passages, French. His six-volume diary was only deciphered and published in the 1820s, more than 100 years after his death.

To historians, Pepys was an invaluable chronicler of a period when the press was censored by the government of Charles II. From him we have poignant accounts of the Great Plague, which decimated England in 1665, and of the Great Fire of London, which destroyed half the city in 1666. On a more personal scale, Pepys supplied entertaining accounts of his financial wheelings and dealings as a government administrator.

“The Diary sends a beam of light into the way in which government officers and businessmen worked together, through clubs, through hospitality, through trips that mixed business and pleasure, through well-chosen and discreetly given presents and through cultivating the friendship of those in a position to be helpful in giving contracts or licenses,” observes Tomalin. “The circumstances were different, but there is something eerily familiar about it too: today’s arms and building contracts, entertainment of clients, quiet words at the club, conferences in luxury hotels, boardroom rivalries and contributions to favourite charities are all in the same tradition. Pepys was, among other things, mapping a recognizably modern world.”

Accounting for the Royal Navy

As one learns from the diary, Pepys was ambitious, intelligent, and well connected. Born in 1633, he never became a sailor, but gained an accounting post in the British Navy and turned it to steady profit. Pepys had the good fortune to capitalize on his family’s one political connection: he was a distant cousin to Sir Edward Montagu, later the Earl of Sandwich. Oliver Cromwell put Montagu in joint command of the British fleet, and the 27-year-old Pepys sailed in on Montagu’s coattails. In 1660 Pepys was appointed Clerk of the Acts to the Navy Board, and as such was responsible for requesting funds from Parliament and dispensing them to build the navy and keep it afloat.

Pepys advanced steadily during the next 13 years, eventually becoming Secretary of the Admiralty. Anyone who wanted a government contract to supply the Royal Navy had to go through his office. Shipbuilders, victuallers, slopsellers, and many others did their best to curry favor with the young finance minister.

On August 16, 1660, in the first year of his diary, Pepys recorded a telling conversation he had with Lord Sandwich. Riding across town in a coach, Sandwich told Pepys that he hopes the Clerk of the Acts position will be good to him, saying “it was not the salary of any place that did make a man rich, but the opportunity of getting money while he is in the place.”

Pepys took this advice to heart. Once sworn in as Clerk of the Acts, he almost immediately found himself on the receiving end of a steady stream of gifts, from barrels of oysters, wine, and brandy to gold coins and silver plate. In 17th-century London, merchants clearly considered these donations to be money well spent, just another cost of doing business.

On April 3, 1663, the diarist described a defense used by politicians to this day, which basically consists of sticking to an absurdly literal, and narrow, truth. After a certain Captain Grove gives him a letter that he can tell contains money, Pepys wrote: “But I did not open it till I came home to my office; and there I broke it open, not looking into it till all the money was out, that I might say I saw no money in the paper if ever I should be questioned about it.”

Another business associate gave him “a present for his wife,” a package said to contain a pair of gloves. On the evening of February 2, 1664, Pepys noted: “When I came home, Lord! in what pain I was to get my wife out of the room without bidding her go, that I might see what these gloves were; and by and by, she being gone, it proves a payre of white gloves for her and forty pieces in good gold, which did so cheer my heart that I could eat no victuals almost for dinner for joy to think how God do bless us every day more and more.”

Plague, Fire, and Fortune

Ironically, biographer Tomalin says the plague year of 1665 was one of Pepys’s happiest. During it his fortune quadrupled, thanks in part to two additional appointments: treasurer for Tangier and surveyor-general of victualling for the navy. Meanwhile, as his fortune grew, so did the plague. From June to September, deaths from the disease doubled nearly every week.

“But, Lord! to see how the plague spreads,” wrote Pepys on June 16. “It being now all over King’s Streete, at the Axe, and next door to it, and in other places.” At its height, in the last week of August 1665, the plague killed nearly 10,000 Londoners. “Thus this month ends with great sadness upon the publick, through the greatness of the plague every where through the kingdom almost,” wrote Pepys on August 31. “Every day sadder and sadder news of its encrease.”

The Great Fire of London, which began on September 2, 1666, and engulfed most of the central part of the city, helped quell the plague by killing the city’s disease-infected rats. As the fire raged toward his home, Pepys packed up his gold and silver and rode by cart in his nightshirt to a friend’s, safely outside the city. What he could not transport, he buried. Luck was on his side, however, and his neighborhood was spared.

As for the Lord of Sandwich, embezzlement was his downfall. While at war with the Dutch, Sandwich’s fleet captured several Dutch ships, including some loaded with goods from the East Indies. Instead of delivering these spoils of war to the King, Sandwich let the hatches be broken and divvied up the prizes with his fleet’s captains. His share’s worth came to 5,000 pounds. When news of this reached the King, Sandwich was stripped of his command. (He would later be reappointed and died in battle in 1672.)

Pepys’s assessment of the fall of “his Lord” is less forgiving. On December 31, 1665, he wrote: “The great evil of this year, and the only one indeed, is the fall of my Lord of Sandwich. The Duke of Albemarle goes with the Prince to sea this next year, and my Lord very meanly spoken of; and, indeed, his miscarriage about the prize goods is not to be excused, to suffer a company of rogues to go away with ten times as much as himself, and the blame of all to be deservedly laid upon him.”

Fearing for his eyesight, Pepys brought his diary to a close in 1669. He would later keep two other journals before his death in 1703, but Tomalin notes that they have “none of the qualities of the first Diary. Something essential was missing — some grit that had caused him to produce his pearl.” The luster of that pearl, and the qualities of the man, can be seen in the entry for Christmas day, December 25, 1666:

“To church in the morning, and there saw a wedding in the church, which I have not seen many a day; and the young people so merry one with another, and strange to see what delight we married people have to see these poor fools decoyed into our condition, every man and woman gazing and smiling at them. Here I saw again my beauty Lethulier. Thence to my Lord Bruncker’s by invitation and dined there, and so home to look over and settle my papers, both of my accounts private, and those of Tangier, which I have let go so long that it were impossible for any soul, had I died, to understand them, or ever come to any good end in them. I hope God will never suffer me to come to that disorder again.”

Observations from Samuel Pepys’s Diary On dog days:

“By coach to St. James’s and there did our business, which is mostly every day to complain of want of money.” (July 13, 1666)

On hard work: “How little merit do prevail in the world, but only favour; and for myself, chance without merit brought me in; and diligence only keeps me so, and will, living as I do among so many lazy people that the diligent man becomes necessary, that they cannot do anything without him.” (November 1, 1665)

On success: “But, Lord! to see what successe do, whether with or without reason, and making a man seem wise notwithstanding never so late demonstration of the profoundest folly in the world.” (August 15, 1666)

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