Finance & Economy

  • NRIs keep faith in India and pour in millions of dollars
    • At a time when every country is desperately in need of funds, especiallly the dollar funds, NRIs have chipped in for India. The government's policies have surely aided their flocking to Indian banks for lodging their deposits. NRIs parked a total of $513 million (on net basis) for the month of September, through its major schemes.
    • Look at this graph.
    • BTW know the various kinds of deposits that are available for NRIs and the difference between them?
      • FCNR(B): Foreign Currency Non Resident (Banks). In this, the deposit is held by the bank in the form of foreign currency only. The interest also is payable by the bank in the form of foreign currency. Thus there is no exchange risk for the depositor. No Wealth or Incometax applicable on these deposits. Gifts made to residents from such accounts are free of Gift tax also.
      • NRE(RA): Non Resident External (Rupee Account). In this type of account, foreign currency brought into the country is converted at the existing rates and held as deposits. It can be repatriated freely. Interest earned on these deposits is exempt from tax. Exchange risk is borne by the depositor.
      • NRO: Non Resident Ordinary. Non residents who have earnings in Indian rupees and need to spend them here in India (subject ofcourse to the FEMA regulations) can open these accounts. The interest on the deposits can be repatriated. Income tax is applicable.
  • Japan enters recession formally
    • Japan became the latest major economy to fall into recession on Monday with France close behind.
    • In something of a surprise, figures showed Japan, the world's second-biggest economy, sliding into its first recession in seven years in the third quarter as financial crisis curbed demand for Japanese exports. The 0.1% contraction in July-September was worse than consensus forecasts.
    • For hardcore economic and finance guys amongst you, I would suggest a read of this. Recommend a look at the graphs given there.
  • SEBI's mulling measures to protect the retail investor
    • You might have guessed or aware that the mutual fund industry is under severe redemption pressures. The redemptions, coupled with erosion in the value of the portfolio of schemes due to the battering of stocks, led to a steep fall of close to Rs 97,000 crore in the assets under management (AUM) of the industry from Rs 5,29,000 crore in September to a little over Rs 4,31,000 crore in October — a period during which most fund houses witnessed, on an average, redemptions of 20%.
    • Even in mutual funds, it is the corporates who have come to play a dominant role in deciding the performance fortunes of a fund. If they invest or withdraw abruptly it is having tumultous impact on the fortunes of the fund concerned. Hence the Securities & Exchange Board of India (Sebi) is reported to be in the process of firming up a policy to increase retail participation in mutual funds (MFs) to neutralise or lower the impact of large outflows by corporate or institutional investors.
  • I am impressed with what Ban Ki-Moon (the Secretary General of the UN) has to say on the ongoing financial crisis. Take a look at his ideas:
    • First, we need a global stimulus package to turn this crisis around. The IMF recently projected that virtually all global growth in 2009 will come from emerging and developing economies. Large increases in public and private expenditures will, therefore, be required in many regions of the world to counteract falling demand.
    • Second, these financial rescue and assistance packages cannot stop at the borders of the richest countries. Emerging markets and other developing countries will need oxygen in the form of credit lines and trade financing. And we must stand against protectionism. Without open trade, growth and development could break down entirely.
    • Third, some part of our global stimulus should come from commitments that the international community has made on aid. In today's environment, fulfilling the Millennium Development Goals is more than a moral imperative. It is a matter of pragmatic economic necessity.
    • Finally, inclusivity must be our watchword. In our interdependent world, these tasks can be met only through reinvigorated multilateralism — one that is fair, flexible and responsive, with leaders coming from all quarters. While the G-20 nations whose leaders met in Washington account for nearly 80% of world production, trade and investment, more than 170 other countries, representing one-third of the world's people, were not there. It is our responsibility to listen to their voices and respond to their concerns.
    • I am impressed especially with the fourth point. We need to listen to the voices of the majority who were not there at the recent G20 meet and respond to their concerns. For if we don't do it, the costs may go well beyond the economic ones that we are currently witnessing.
Politics & Society
  • Terrorism: how should the revelations in the Malegaon balsts probe be read and understood?
    • An excellent debate from three experts on the issue. Can't afford to miss. Very sane voices. Very powerful arguments. Should I also add, very 'right' noices? But is anybody listening?
  • In these hard times, you do need a hilarious dose once in a while.
  • Take a look at this good piece that explains about the phenomenon of 'power without accountability' that the armies in Pakistan and Bangladesh have come to exercise of late.
While our cricket team is surely doing us proud, let's take a look at what China does differently in sport. To encourage mass participation and recognize local talent. They have what is called "Chinese Peasant Olympics." What attracted me to this concept is the fact that instead of making some foreign origin sport as its national sport (as cricket has become in India), this event gives so much importance and recognition for its local versions. After all what is sport about? Except for inculcating the spirit of adventure, competitiveness and camaraderie in us?