All you need to know about this online currency

In the year 2009, a person with the pseudonym Satoshi Nakamoto created an online currency in the form of bitcoins. Bitcoin is a currency designed for  electronic use only. There are no physical coins or banknotes associated with bitcoins; they exist only as a series of ones and zeroes zipping through the ether of cyberspace.  There has been a drastic change in the value of a bitcoin. While at times there was an  astronomical rise, there was also a fall. This rise and fall in bitcoin’s value says a lot about the current state of world economy.

Rather than counting on the governments or central banks to secure the value of the currency and guarantee transactions, the founder of bitcoin ensured that the bitcoin places its trust in maths. This rebellious internet currency has been in demand because of the events that have shaken public’s confidence in government-issued currencies.

Have a look at this minute-long video describing bitcoin.

After the Cyprus Bailout; which said that the government would start taking money from people’s bank accounts; there was a massive need to have a place where the public money remained untouched. In fact, people in Cyprus were running to ATMs to take out their savings before the deposit levy kicked in.

And then, bitcoin’s media coverage went viral, increasing its value drastically in days. A week before Cyprus Bailout, you could buy one bitcoin for about 45 dollars. A week after Cyprus, it cost 100 dollars.

It’s been going up and down for the bitcoin since then; as of January 2013, one bitcoin was worth 13.51 dollars. Earlier last week, it went up as high as 266 dollars. And on Thursday, it plunged to less than 100 dollars. In Indian Rupees, it would mean starting at 737.11 rupees, then rising to 14,512 rupees and then plummeting to 5,456 rupees. Imagine how many people made a quick buck and how many people lost their livelihoods in a matter of days.

What could cause all this? The answer is pure speculation among the people. People are obviously buying it, knowing that its value will rise, not because they want to use it as a normal currency but more like shares. Admittedly, this bitcoin system is much more stable and properly designed than any other online currency in the economic history.

By attaching a transaction history to each bitcoin, despite retaining users’ anonymity, counterfeiting becomes much harder. You can’t create fake transactions, can you?

The supply and productions have also been strictly regulated. While the relatively small supply of such hard currencies means that the inflow and outflow of hot money can make them highly volatile, bitcoin is still the first well-designed online currency. Its volatility isn’t as bad as Cyprus’ economic conditions and it will most likely get modified and re-introduced.

A creative way to move money, bitcoins can insulate people from high inflations in their countries, dodge international approvals and reach markets which were earlier out of reach. Black Market transactions also may become easier. You can deal in anything— recreational drugs to paper currency, songs to survival gear, cars to consumer goods —no borders, no change fees, no closing hours, and no one to tell you what you can and can’t do with your money.

And despite the recent crash, bitcoins remain hugely popular among drug dealers and buyers. And why wouldn’t they be? They’re getting websites like Amazon, where they can advertise their wares in a consumer-friendly atmosphere. The same goes for the buyers, they could buy LSD as if they were buying headphones on Flipkart.  All this is even easier with a decentralised system because then detecting suspicious activity, identifying users and obtaining transaction records will be problematic for law enforcement authorities. This could worsen if illegal activities involving terrorism, child trafficking and pornography start happening.

Despite this bad side, bitcoins have its defenders, especially with more and more enterprises accepting bitcoin payments. Easy access of this currency is another thing users love, saying they’d rather keep their money in the cloud than in a bank. And with the worsening conditions in Cyprus and Europe, they do have a point.

But what if your bitcoins are stored in an online wallet?

The website itself could be compromised; if they’re stored in a desktop client, the integrity of the machine is all that stands in the way of a theft. Here, the facelessness becomes a downside: any thief can create a new address, send your money to their account, and use the web of anonymity to send the cash around the world before you might even notice that it’s missing.

Like any other thing, bitcoin has its pros and cons; I am sure it will not become an everyday currency, but it just might become the international trade currency.

The longer this currency stays alive; more people will continue to believe in it. It’ll vary from person to person; risk-lovers won’t mind getting in on this, while risk-averse people will be too fearful to recognise the idea of “online currency” especially after that monumental fall (losing 80 per cent of its value). Nevertheless, internet will surely start to offer such currencies in the future. The government on the other hand, won’t back it or approve it, and they’ll have to control it by imposing harsh taxes.  Bitcoin’s value may have risen and fallen, and it’s not guaranteed to be the future currency, but there is a slight chance that it might.

Akhil Thakur

Image Source [http://ceptacle.com/post/new_pics/51f3ac99-1469-4c9f-ac3d-bd4d3e2d6737.jpg]

]]> http://theviewspaper.net/bitcoins/feed/ 0 http://theviewspaper.net/commercial-controversy/?utm_source=rss&utm_medium=rss&utm_campaign=commercial-controversy http://theviewspaper.net/commercial-controversy/#comments Wed, 27 Mar 2013 04:59:14 +0000 @Hear0To3fVie0ws8Paper http://theviewspaper.net/?p=48353

Ford Figo’s tasteless and controversial ads shocks everyone

JWT India is facing a lot of criticism today because the creative team came up with three controversial ads for Ford Figo. A division within the agency uploaded the unapproved ads on a site called adsoftheworld.com. The photos not only portrayed women in a disrespectful way, but they also showed famous personalities in an insulting manner.

The ad’s tagline was “Leave your worries behind. With Figo’s Extra Large Boot”. The tagline itself is quite catchy and creative, but the ad’s visual content took it to a strange level. Instead of showing luggage in the trunk, they decided to put tied up and gagged human beings in the trunk. Not only was this creepy in general, the women were made with barely any clothes on and it had famous, controversial personalities.

The first had Paris Hilton driving the car with the Kardashians tied up in the trunk. Hilton is shown winking while the Kardashians are shown in minimal clothing and just thrown in.

All these women are constantly in the limelight for sex scandals, legal issues, their clothes, or their lifestyle. They are also reality TV rivals.

The second ad had former Italian Prime Minister Silvio Berlusconi driving with a big grin on his face and in the trunk are the women who brought him down with a sex scandal. He was forced to resign after the hype.

This ad not only portrays the defamation of the former leader in a tasteless manner, it can also spark controversies with the already tainted relationship of Italy and India.

The third ad had Michael Schumacher with Sebastian Vettel, Lewis Hamilton, and Fernando Alonso tied up in the trunk.

They are F1 racecar drivers and the ad shows how Schumacher is getting rid of his competition to win.

All of these ads have famous people with the actions exaggerated to a point where it becomes offensive. The women are shown wearing skimpy clothes and bound, a chauvinistic attitude towards the treatment of women and making them objects. After the outrage over the rape cases and the perspective of men towards women in India, these pictures just fuel the anger.

Apparently the ads were not paid for and weren’t properly released. They were not meant for commercial use but they were still uploaded on the internet. When images are released across the web, it stays there and goes viral. The ads may have been removed from the original website but they are still easily accessible.

The WPP group (parent of the JWT) and Ford apologized for the ads.

(As told to Fox News)

“We deeply regret this incident and agree with our agency partners that it should have never happened. The posters are contrary to the standards of professionalism and decency within Ford and our agency partners. Together with our partners, we are reviewing approval and oversight processes to help ensure nothing like this ever happens again.”

Ford spokeswoman Sethi Deepti ensured that there was no intention for these ads to be publicized. (As told to NY Daily News)

“We take this very seriously and are reviewing approval and oversight processes, and taking necessary steps to ensure nothing like this ever happens again.”

The CEO of JWT India Colvyn Harris also apologized for the pictures. (As told to Economic Times)

“These were made as posters by individuals. They have never been paid for and were not expected to be released,”

These ads throw a bad light on the people depicted in them. Not only do they defame the ‘drivers’ in the ad, but also the victims. This ad shows a lack of decency and maturity in the company.

Showing women stuffed in trunks of cars just reflects the attitude of men towards women. Even if the intention wasn’t as malicious as we perceive it, there was nothing uplifting in it, either. Tying up people and putting them in the trunks of your cars just highlights the criminal intent of many in the country, no matter how ‘clever’ people thought it to be.

Taking below-the-belt hits at famous personalities does not show creativity but desperation and insensitive. The Schumacher ad may be taken in a good stride but there is no excuse for the other two. Even if it were just for fun, we’d like to hear the explanations for the busting seams of the clothes and the ball gags in the women’s mouths.

Ads earn their points for creativity and content; the popularity of the ad also determines the product’s fate.

But does it mean that companies start going to such low levels to get the required attention?

People may find the ads clever or funny, but it might be safe to say that this big splotch on Ford’s reputation may cost them a good number of sales.

Ambika Chauhan

Image Source [http://cached.imagescaler.hbpl.co.uk/resize/scaleWidth/460/?sURL=http://offlinehbpl.hbpl.co.uk/News/OMC/A747F0A3-EC07-15C7-155F5647F48A4163.jpg]

After such a long wait, SC will hear arrest request

The news surrounding the Sahara Group and Shri Subrata Roy has been in the news for quite a long time. The latest news comes that SEBI (Securities Exchange Board of India) has moved to the Supreme Court for his arrest. The regulator and unlisted Sahara has been locked in a long-running dispute relating to a Supreme Court order asking the Sahara group to refund more than 24,000 crore rupees of investors’ money raised by the two group firms through the issue of bonds.

SEBI has filed a petition that requests to allow them to-

“Take measures for arrest and detention in civil prison of promoter of Sahara Shri Subrata Roy Sahara and the two male directors, viz., Shri Ashok Roy Choudhury and Shri Ravi Shankar Dubey after giving reasonable opportunity of hearing.”

Apart from that, they have also asked that the two accused be ordered to submit their passports with the court, so that they can’t leave the country. The Supreme Court will hear the petition in the first week of April. And if these two powerful men do get arrested, it will send a powerful message to all the other powerful politicians and businessmen.

The two Sahara Companies- Sahara India Real Estate Corporation (SIREC) and Sahara Housing Investment Corporation (SHIC) were told by the Supreme Court to refund the obscene amount of 24,800 rupees- firstly by the end of November and then by the end of February.

Obviously enough, Sahara group denied that they owed that much money and paid only 5,120 crore rupees. The suspicion on Mr. Roy conducting illicit deals has been there for years, but like a disease these funds have spread to his other enterprises, most notably his Pune IPL Team.

Sahara claims to have a number of three crore investors. However, results of a preliminary sample verification exercise done by market regulator SEBI show that just about one per cent of investors in the two Sahara companies responded to SEBI’s registered letters asking them to confirm their investments.

So, if we’re to believe that ninety nine per cent of the believed investors are as fictional as Harry Potter, then all I have to ask is how they kept it under everyone’s eyes for so long. And we should believe so – out of the 21,253 registered letters sent to Sahara investors, only 233 debenture holders responded – a success percentage of just 1.09 per cent. The other 7000 plus letters showed “address not found” or didn’t get returned. Wow, what a con.

What wasn’t surprising was Sahara’s response to all this saying that SEBI’s allegations were “absolutely baseless, unverified and malicious”. Now, what’s interesting is this- SEBI got all the investor information from Sahara itself; the documents were scanned by SEBI personnel and they can’t claim that SEBI- the independent regulatory authority, falsified the documents. This falsifying of investor information to get money is known as “benami funding”.

In a recent Indian Express report, “Sebi found that in a batch of 20,000 mailers it sent to investors based on details given by Sahara, more than 8,000 were returned by India Post with the stamp”. This means that out of a batch of eight thousand, only sixty eight people were found to be genuine.  This is more than shocking, but then again the Sahara group has somehow not paid twenty four thousand crores to this date.

Sahara claims that in the past thirty three years, they’ve never received any benami money, but with the results of so many investigations, it’s more worrying to be an actual, real investor in the Sahara companies right now.

This case has been dragging on for so long that the public has lost hope and interest. This can only mean that they feel that the case should have been resolved by now. But nevertheless, Mr. Roy has now gotten himself stuck in one of the nation’s worst cases of alleged contempt of court orders and he’s not the only one involved; SEBI seeks to impound the passports of Ashok Roy Choudhary and Ravi Shankar Dubey and Vandana Bhargava, all of them directors.

The accusations include failure to submit documents on time, in August, December; February and also submission of files in an unacceptable, haphazard manner and especially failure to pay their dues.

It’s high time that the Supreme Court takes this petition request seriously. SEBI, this time has covered all its bases and it seems unlikely that Subrata Roy and his accomplices will get out of this mess this time.

Akhil Thakur

Image Source [http://propertyobserver.in/wp-content/uploads/2013/01/Sahara-group-chairman-subrata-roy.jpg]

A look into the former president’s riveting speech

As the moderator at the India Today Conclave 2013 also said, in this world full of cynicism and frustration, Former President, Dr. A. P. J. Abdul Kalam brings an aura of optimism into our minds. Yesterday, after being introduced by Aroon Purie, (the Editor-in-chief of the India Today Group), Dr. Kalam gave an inspiring speech on the topic “Paradigm Shift in Thinking”.

He shared his ideas on reinventing democracy, stating that the fundamental principle of a democracy is there to stay forever which includes the continuous empowerment of citizens. He very aptly compared seeds of a banyan tree to the citizens of the nation. The idea was to make sure that the democracy may provide the citizens with the opportunity to perform,  grow and realize their own potential.

As he rightly pointed out, the citizens of an ideal democracy have the right to freedom, dignity and aspirations. And to empower these citizens, there is a requirement of a strong education system- especially in the primary schools, where there is an abundant of creative teachers, creative syllabi and creative classrooms.

Now this point makes a lot of sense since it’s only in our early years, that we get to show our creativity. And if we don’t give the school kids that opportunity, they’ll probably never be able to express their true skills. He made a brilliant argument about ignited youth minds being the most powerful resources of a country.

Being a man who has met almost fifteen million students in the last ten years, he feels pleased when the youth ask him questions, especially the difficult ones.

The young minds are impatient and turbulent, and only vision can satisfy them. But for that, we need visionary leaders. In China, he said before starting a political career, citizens go through year-long courses in politics. After they graduate, only then they can begin their political careers.

He even had quite interesting views on the issue of corruption in the government. With the frustration of delaying of justice, this impatience could cause a revolution. He made his point about strengthening the current democracy and taking advance action.

In a democracy, disciplined and enlightened is the finest thing in the world. Those qualities may be quite hard to find, but they’re certainly needed.

He rightly mentioned the idea that people should respect and celebrate each other’s cultures, visions aspirations and differences. After all, the country’s cultural heritage is one to be proud of.

A democracy works on people’s dreams and the current political system needs to be reinvented with responsibility. And with that in mind, Dr. Kalam laid out the components of a good leader.

A good leader should spend thirty per cent of his time on politics- elections and getting elected. And the rest seventy per cent should be spent on building vote banks and development of constituencies. As correctly pointed out, the people show preference to a leader who brings development. Although, these days that time ratio is spent in a much different way.

A leader should work and succeed with integrity, and in the current scenario, integrity is the one quality most political leaders need.  A leader ought to see problems and opportunities. He should have the courage to tread a road not taken; take his own decisions and have thought mobility. All these qualities would really make quite a role model for the current youth.

With an enthralling speech that went for half an hour (though ideas never made it seem that long), the best moment of his speech was when he said,“ The greatest quality of a leader, in any field, is that he gives credit for success to his team and stands by failure.”

With his bits of humour and his philosophies, even at the age of eighty one, Dr. Kalam works as hard as ever for the overall development of the nation and continues to inspire many youngsters; no wonder he’s got a cult following.

The people’s president, an icon and a man elected president for his personality (never an ornamental president); his innovative ideas continue to inspire us all.

Akhil Thakur

Image Source [http://libraryseva.com/wp-content/uploads/2012/12/APJ-Abdul-Kalam_Library-Seva.jpg

CobraPost catches Axis, HDFC and ICICI bank in the act

“Operation Red Spider” was the name Cobrapost gave to their sting operation, which ultimately ended up exposing money laundering practices in HDFC Bank, ICICI bank and Axis Bank. This expose truly questions the logic to give private banks licenses at a time of political pressure and also questions the feeble regulatory system.

The sting reveals that any person claiming to represent a politician with tonnes of black or illegal money is easily able to convince bank officials that he needs solutions for converting black money into white. The bank officials more than oblige; rather, they offer tea and masala dosas, and ignore basic requirements like Know Your Customer (KYC) norms or PAN card details.

The banks launder money by accepting cash and investing it in gold, real estate and insurance schemes, without using Pan Card details, split the money into portions and deposit in different accounts, transfer the black money into the financial market and help the client convert the money into white/legal money. For a more detailed look, go to http://www.firstpost.com/business/here-is-how-cobrapost-alleges-private-banks-laundered-money-660547.html.

The black money holders sneakily invest their money in the banking market. With diversification in mind, they buy real estate, gold, stocks and even open fixed deposits in banks. The money paid for the insurance schemes gets invested into bonds, stocks and securities- government and financial. This spreads the black money into all areas of the banking market.

The deal with buying gold is this- a large amount of black money can be hidden by buying a very small amount of gold. Also, gold is a very liquid asset, meaning it can quickly be sold back at market price. It’s said that India has a lot of gold due to Indians’ love for the metal, but couldn’t it also mean that there’s a lot of black money floating around?

When insurance policies are bought, they are converted into debt securities or shares of companies, thereby introducing the black money to the financial system. As more and more black money enters the system, the greater the chances of it being detected. It’s easier than finding black money in land and real estate.

In the year 2008, P. Chidambaram introduced The Banking Cash Transactions Tax (BCTT), which aimed at solely dis-incentivising cash transactions that were becoming channels for channelling and laundering—black money. It was obviously criticised by quite a few politicians. In the year 2009, he had to withdraw the tax before elections. Had the tax still been around, it could have made it tougher for banks to launder money.

After watching these videos, particularly the ones about HDFC and Axis bank, you’ll notice the ease with which the managers were willing to go out of their way, just to do such shady deals. It’s as if they were performing according to the standards and weren’t being cheating scoundrels.

Aniruddha Bahal, Editor-in-chief at Cobrapost told Firstpost in an exclusive chat that he used only a single reporter to uncover the unholy link between India’s top three private banks and politicians. When asked if he was anticipating any defamation cases, he said,” The evidence we have is too strong. It will be foolish if people file defamation cases against us with this kind of information”, and rightly so. After so much video evidence, the banks have no case.

The banks have announced that they will begin full-scale internal investigations. ICICI Banks has already suspended eighteen employees after this expose. How is it that the employees in the lower levels of the hierarchy are the only ones who pay for this?

They must’ve just been following orders, weren’t they? It’s quite hard to believe that the ones giving the orders had nothing to do with this. Still, the ones at the top walk free while the subordinates suffer.

If personal bankers at the front desk can take such big decisions on helping people convert black cash into white investment, it means that the top managers of the bank cannot fake ignorance. When the absolute top may have credible deniability, such operations cannot be carried out without approval of top level management. To claim that they didn’t know malice was stirring or that it didn’t have even their implicit consent sounds suspicious. And if they really had no idea, then that is utter, unbelievable negligence.

Although it’s not official yet, the RBI is expected to take a closer look at the guidelines on transfer of funds and know your customers (KYC). It may seek detail reports from private banks involved on the big-ticket cash transactions. But after this sting, the RBI’s role as a regulator has come into question and it seems like it lacks the know-how to police banks. “Banking Supervision” should be invested in a fully independent and qualified organization.

Predictably, share prices of the three banks under question fell, creating losses. But that may be the least of their problems as the government will be taking action against persons found guilty in the alleged money laundering scam.  And with their books and information being looked through, their licenses could be re-examined and if found guilty, be revoked.

All-in-all, these banks are making the rest of the income-tax-paying citizens look like complete idiots. They are going out of their way- again, by offering chai, dosas and even personally coming to people’s houses- just to collect that black money. With so much damning evidence, it’ll be interesting to see what the Banks’ CEOs say and the government does about it.

Akhil Thakur

Image Source [http://www.wallsave.com/wallpapers/1280x800/money-indian/1081244/money-indian-rupee-inr-republic-of-india-in-1081244.jpg]

The opinions vary when it comes to P. Chidambaram’s layout of the fiscal year

When you look at P. Chidambaram’s budget plan for the year 2013-2014, it has its positive and negative factors.

For starters, Chidambaram wants to empower the youth by providing funds for education and skills that one needs to maintain a secure future. He also addresses the women and the youth- the two groups that need the most attention. That not all, he taxes the “super rich” and some of the accessories that people use on a daily basis. While these are the positive aspects of the plan, there are just as many loopholes.

Although Chidambaram talks about the youth empowerment, he taxes the same people through the rise in excise duty on products that are used on a daily basis. The demand for SUVs, smartphones, cigarettes, and restaurants is high among today’s generation, and the same have been made pricier. Therefore the youth he supports will in turn be affected by the price hike.

Another loophole that the budget has left unanswered is the economic growth of the nation. The fiscal deficit (excess of government spending, over it’s revenue) is still in question and there were no concrete plans that provided a solution to this issue. In fact, the finance minister was worried as well. The budget of the previous year was exceeded by 67,000 crore rupees and this year it has increased by 16 percent.

This plan has led to higher borrowing and increasing the taxes on the rich and the middle class. Not only does this fiscal deficit put pressure on the economy, it gives no solution for the already existing high inflation rate.

When it comes to women, the finance minister provided 1000 crore rupees for the Nirbhaya fund and Women and Child Development. Throughout the speech he concentrated on women and providing funds for the sectors they want to enter in, be it education, household, or work. But the budget does not mention anything about increasing the safety of women.

Money is not the only thing that is crucial; women of this country need to regain the trust that they’ve lost due to events of past.

Next up were the poor, Direct Benefit Transfer Scheme has been proposed to help 11 beneficiaries with their funds. Scholarships were given to many villages, helping dalit boys and girls with their education. He has also provided the Rashtriya Swasthiya Bima Yojna for poor families like the ones of rickshaw-pullers, auto-drivers, rag pickers, and mine workers. But when it comes to the betterment of the people living on the streets and the ones who do not earn even a day’s wage, there was no fund mentioned.

Despite the shortcomings of the plan, there are plenty of benefits as well. The increase in allocation of funds in the agricultural sector is one of them. Investors and first-time home builders also have a reason to be happy because the taxes have been reduced for their sector. There is a positive side to the increase in taxes as well; it will help the youth with their savings and they will also learn to differentiate between what they need and what they want.

This is what we think, now lets hear what some of the other youngsters have to say about the Budget:

Anamika Chauhan, who works at American Express, worries about the safety of the woman and the taxes on the middle class.

Ankit Kashyap, a lecturer at Amity University, believes that the government might achieve the financial goals this year as the Budget concentrates on the economic growth of the country.

Shreya Thakur, an intern at The Hindu, is not happy with the price hike on the different products and accessories that youngsters use on a daily basis.

Kshitiz Goliya, a student of Amity University, believes that P. Chidambaram has maintained a balance layout for the budget this year.

Gurveen Kaur, who works as an analyst for an MNC, was very disappointed by this year’s budget especially with the clauses related to education and taxes.

Sudhanshu Vij, a Campaign Manager in an IT firm, believes that the budget was very neutral and not very election-friendly.

After listening to all the opinions, the budget seems to be quite practical and “safety-first” types. While it focusses more on education, women, and the entire youth of the nation, there are several issues that worries the country.

The tax space hasn’t been widened as only 35 million taxpayers that constitute 3 percent of the entire population, have been taken into consideration. Clearly, the people outside the tax net have not been identified.

And with the next year election in mind, this year’s budget keeps it safe and does not make bold promises. But it’s not that bad because it does look at the bigger picture.

What do you think?

The Viewspaper Team

Image Source [http://images.cxotoday.com/2013/02/budget_2013_DEcmu.jpg]

Union Finance Minister P. Chidambaram’s unveiling of the 82^nd annual Budget gets both positive and negative reactions

On 28 Feb., 2013, P. Chidambaram gave the nation its 82^nd annual budget. Major issues were covered, including financial aid to the three large groups of the nation- the youth, the women, and the poor. But on the other hand, many found it to be anti-common-man and not without major loopholes.

The major changes that would have a great impact:

1. Controlled-climate (air-conditioned) restaurants will be at least 12 percent more expensive than before. Eating out will now cost the people, with an additional price-list change due to a rise in the price of food commodities.
2. With the high demand of cell phones (especially smartphones), the increased excise duty on cell phones will cost many. Phones that cost more than 2,000 rupees will be more costly with the excise duty rising from 1 percent to 6 percent. This will have quite an effect on mobile companies like Nokia and Samsung Electronics.
3. Increased excise duty on cigarettes and cigars by 18 percent will have a negative impact on India’s biggest tobacco company (ITC Ltd.)
4. Increased import duty on luxury cars, motorcycles, and yachts from 75 percent to 100 percent. Increased excise duty on sports utility vehicles (SUVs) from 27 percent to 30 percent that would hit the companies like Mahindra & Mahindra and Tata Motors.
5. People will have to pay more for travelling. Freeing prices of petroleum products that might result in a probable rise on the prices of diesel and cooking gas.
6. Good news on the excise duty of garments. Branded apparel, readymade garments, carpets, and other floor coverings will be cheaper due to the reduction in their excise duty.
7. Duty free gold purchase will be made easier for the NRI’s; they will be able to buy more gold without worrying over the duty. But this is only if they have been living outside India for at least a year’s time.
8. Investors and first-time home buyers will benefit from the Rajiv Gandhi Equity Savings Scheme. It will help the ones who are looking to invest and provide a tax-break. The investors will also be positively affected by the rise in the income limit to 12 lakh rupees from 10 lakh rupees. Home-buyers will get a deduction of 1 lakh rupees from interest to be paid on home loans above 25 lakhs rupees.
9. Tax payers with taxable income of up to 5 lakh rupees will be provided with a tax credit of 2,000 rupees (that will result to a revenue sacrifice of upto 3,600 crore rupees). The finance minister also provided instruments like the inflation-indexed bonds to protect people’s personal savings from inflation. There will be a one-year surcharge of 10 percent on the “super rich” tax payers (taxable income above 1 crore rupees).
10. The surcharge has been increased from 5 percent to 10 percent for domestic corporates with taxable income of 10 crore rupees. Foreign companies will pay a 5 percent surcharge instead of the previous 2 percent. This surcharge is said to be in place for a minimum of one year. Capital allowance of 15 percent to companies that invest more than 1 billion rupees.
11. A Tax Deducted at Source (TDS) of one percent for the transfer of immovable properties above 50 lakh rupees.
12. Power and Energy Sector:

• Equalize the duties on steam and bituminous coal (2 percent each for customs and countervailing duty)
• No custom duty for electrical plants or machinery.
• Revenue-sharing policy in oil and gas sector

13. Foreign Trade: Reduction on duty of precious and semi-precious stones (2 percent from 10 percent)

14. Banking: 140 billion rupees capital infusion in state banks

15. Defence: 2.03 trillion rupees allocation

16. Agriculture:

• 270.49 billion rupees for agriculture
• 801.94 billion rupees for rural development.

17. Higher allocation for road building that would have a positive effect on highway       developers. Regulatory authority for the road sector and 3,000 kilometers of projects to five states have also been given.

18. 1,000 crore rupees each has been allocated to the women and youth of the nation. Nirbhaya Fund (safety and security of women) named after the Delhi gang-rape victim will also get 1000 crore rupees. These funds promise security to the women, youth as well as the senior citizens of the country. 17,700 crore rupees allocated to the Integrated Child Development Scheme (ICDS).

19. Health and Family Care:

• 37,330 crore rupees for the Ministry of Health and Welfare
•  110 crore rupees to department of disability affairs
•  4,727 crore rupees to medical education and research
•  1,069 crore rupees to Department of Ayush

20. Social Issues:

•  200 crore rupees for Women and Child Welfare Ministry
•  3,511 crore rupees to Minority Affairs Ministry
• 13,215 crore rupees for mid-day meal programme
•  27,250 crore rupees to SarvaShikshaAbhiyaan
•  65,867 crore rupeesto the Human Resources Development
• 169 crore rupees for development of Ayurveda, Siddha, Unani, and Homeopathy
•  41,561 crore rupees for SC plan
• 24, 598 crore  rupees for tribal plan

21. Ministry of New and Renewable Energy has been provided 800 crore rupees.

The plan although detailed and well presented, still has many unanswered queries about the fiscal deficit of 4.8 percent the inflation, the slow economic growth, and the increased expense for the common man on a day-to-day basis.

The opposition had a lot to say regarding the Budget 2013:

(As told to TOI)

Sushma Swaraj, LokSabha:

“There is nothing for the women, youth and poor” in this budget and neither is anything there for boosting the agri sector or for controlling prices.”

Arun Jaitley, BJP Leader:

“Having pushed the economy in a distress situation, he comes out with a budget of helplessness. In the first nine years, UPA government pushed the economy in distress and then a helpless finance minister comes out with a budget which has very little elbow space.”

Mulayam Singh Yadav, Samajwadi Party leader:

“This budget is only for 10 per cent population of the country. What kind of budget is this which ignores 65 per cent people who are engaged in farming?”

Mayawati, BSP Leader:

“There is nothing new in this budget and there nothing for farmers, employees and the middle class.”

There has been a great debate that has been going on the outcome of Chidambaram’s plans and provisions. On one hand it seems to help many sectors of the society including the women, youth, and the senior citizens. But on the other, it creates a dilemma for the middle class and does not solve the issues of inflation and economic growth.

There is a lack of faith when it comes to the numbers Chidambaram has provided, disappointing many with the reductions and provisions. But some admire the lack of risks and believe in the plan.

Will the outcome be positive or put Chidambaram’s reputation at stake?

Ambika Chauhan

Image Source [http://pbytes.indiaproperty.com/wp-content/uploads/2013/02/Budget-2013.jpg]

Budget 2013

Many of us have been waiting for this since the beginning of this year right? And the curiosity increased as we approached 28^th Feb. So here are the highlights of the day.

You can also read all of this in detail in our Finance Minister’s speech: http://www.scribd.com/doc/127740560/Budget-2013-2014-Speech-of-P-Chidambaram

Now that you are aware of the basic points I am going to talk about something that affects me directly. Because frankly speaking I don’t understand what this fiscal deficit thing is.

The first spark in Finance Minister P. Chidambaram’s budget came in the form of an announcement of all-woman banks across the country. Probably, because no one had seen that coming. These banks are to be set by October this year.

At first this sounds really interesting and rejuvenating but when you think about it, what is the future of such banks?

It’s definitely to fund issues related to the safety of women. Like the FM pointed out, it will create employment for women and help fund enterprises floated by women.  However, there is little that the budget had to encourage women to turn entrepreneurs.

As Kavita Krishnan from AIPWA (All India Progressive Women’s Association) points out, “Women in India don’t have the basic health facilities. Thousands of villages don’t have a single primary healthcare centre, there are no gynecologists, pregnancy deaths are so common, how will the bank help all these women? We immediately need a facility that helps detect the various forms of cancer women are susceptible to… women in villages don’t have any facility to detect the disease till it has spread fatally.”

Also there seems to be three classes; the poor, the middle class and the rich. So going by that division, the poor women don’t have enough money to save, and the middle class and rich women who earn and wish to save have their accounts already. So what is the need of gender based banks?

Nevertheless, keeping in mind the reality of the situation, Chidambaram’s idea of all women bank comes only as a feel good statement.

The Finance Minister must have hoped to hear cheers when he announced the Nirbhaya Fund. However not everyone was flattered.

Chidambaram also said, “I urge the Ministry for Women and Child Development to figure out strategies to utilise this fund and make the country safer for women.”

How is 1000 crore rupees going to help women feel safe while walking alone? And what’s worse is that our government seems to think that the only vulnerable women in this country are widows and sexually assaulted women.

What about the women who are the sole breadwinners of their family? There was nothing in the budget about them.

Chidambaram has also allocated 1000 crore rupees for the youth. If we try and distribute this money among the 60 crore Indian youngsters (approx.), they all get four rupees (approx.) per day. Man how I wish to get an admission into the best college of the country…

Thank you Mr. Finance Minister.

And there was something for all you tech enthusiasts as well.

Yes, I feel the pleasure in informing you that there is an increase in the excise duty of phones that cost more than 2000 rupees. The excise duty on phones that cost above 2000 rupees has been raised from one percent to six percent now.

The bad part is that a phone that earlier cost 10,000 rupees will now cost 10,495 rupees (approx.); ones that cost 20,000 will approximately cost 20,990 rupees (again approx.) and so on.

Here is how the renowned mobile company members reacted and they aren’t wrong:

Asim Wasri, Vice President Samsung mobiles, said, “The increase in the excise duty on mobile phones will not have a positive impact on the mobile industry and should lead to an increase in prices for end consumers.”

“The mobile phone segment is very competitive. But we have no option but to increase prices. It is a hard Budget for the mobile phone segment,” Lava Founder and Director S N Rai said.

“The Government’s decision to keep concessional excise duty of 1% intact on mobile phones in the sub-Rs. 2,000 category is welcome,” P. Balaji, VP and Managing Director, Nokia India, said. “However, we would request the Finance Minister to roll back excise duty increase on mobile phones beyond Rs. 2,000, as mobile phones are the primary mode of access to information and services; a tool for learning, development and income generation for the youth and non -urban consumers.”

And since even the basic Micromax phone costs 4000 rupees, anybody who has been saving up to buy the latest phone needs to take a step back and think.

There are a lot of things that I haven’t talked about because frankly speaking there is nothing in it for the youngsters like you and me or anybody for that matter. And the fact that it is not decisive enough in any direction.

This year’s budget has not lived up to expectations perhaps because the FM wanted to be safe rather than sorry, keeping in mind the general elections next year.

He wants to live to fight another day, let’s just see how many.

Shraddha Jandial

Image Source [http://www.pearse-trust.ie/Portals/43760/images/162%20-%20Budget%202013%20%E2%80%93%20continuing%20Ireland%E2%80%99s%20recovery.jpg]

With hardly a few days left for the finance minister to open the cat out of the bag and state his budget for the fiscal year 2013-14, people in all rungs of the social ladder will be expecting an economic reform to take place.

As stated in Abraham Maslow’s theory of human motivation, the first step is to attain the basic requirement of food, water and shelter. With rising prices becoming quite common today in our country, there is a need for economic stability among people of various income groups. The expectations of a farmer vary from those of a middle class man who manages to earn 3,00,000 rupees a year.

In a country primarily relying on its agricultural revenue, the importance of waiving off farming loans needs to be realised. This will greatly benefit those people who fall in a lower income bracket. Though the write off of central loans will save a lot of money for the state government, people contest the fact that waiving off loans is against the moral principles of lending loans; it penalises those who repay the loans. Not to mention, that the question of expectation comes into picture. Farmers might expect further loans to be waived in the future. The problem lies in the fact that when prices rise, these people are forced to spend a large part of their income on a basic requirement like food, which takes savings out of the equation.

For people in the middle income criteria, it’s about increasing the income limit for taxation. High taxation rates in times of inflation could hit hard in the financial positions of people in the middle income group. The standard of living of these people is reduced. The obvious solution then is to increase the tax rate for people who fall in the high income group. People will never hesitate to pay taxes if the money is used properly; increasing the tax rate for this income category forces people to deal into black money. The result: They focus on saving money rather than giving it out to the government just to be eaten off by corrupt politicians.

With the weakening manufacturing sector, there needs to be an increase in investment which could not only strengthen its stand, but also generate jobs for thousands. The manufacturing industries need a revamp in the way they are run. Adequate funding to improve the infrastructure of this industry and construct more micro-industries could help boost growth and generate jobs which could in turn reduce the percentage of unemployment.

And coming to one of the most important aspects; education.

Education is the backbone of a developing country like India. A lot of thought has to be given to allocating funds for promoting students to pursue higher education, particularly those from a poor financial background. Exceptionally talented people of a poor background need to be encouraged by providing more government scholarships. Infrastructure in schools situated in the rural areas could be improved. People here fail to send their children to school because of improper sanitation facilities. This is a primary requirement especially for girls. And such steps will affect the literacy rate on the whole. The last venture of providing mid-day meals to children helped a great deal in increasing the number of students who turn up in school. Such innovative ideas are in call for, in order to improve the standard of education provided to the poor.

With energy crises in states like Tamil Nadu, where the output from industries have been poor due to acute power crises, investing in transmission lines to benefit the transfer of power could go a long way in increasing the throughput from industries.

Power, unlike edible entities like milk (which can be transported easily) needs transmission lines to transfer it from one state to another. Improper infrastructure of transmission lines to carry power from states like Gujarat to Tamil Nadu is one of reasons for the daily two hour power cuts, which can in turn affect the working of software and manufacturing industries. And since fuel price always seems to be exponentially increasing, the possibility of using generators is completely eliminated.

The Aadhaar (Unique Identification Authority Of India) was a great step towards mobilizing funds and preventing corruption, or at least keeping it to a minimum. Nandan Nilekani took the great responsibility of leading the team to work on the Aadhaar. A great deal of investment went into infrastructure development, since this requires optical fiber lines to reach villages and rural areas. In the Aadhaar scheme, money is transferred directly into the concerned person’s account which prevents its misuse. Further investment is an assured necessity for its full-fledged use throughout the country. But the next task lies in integrating Aadhar throughout the country and partnering up with nationalised banks for error free transfer of funds.

Today, India is witnessing a dull period in its economy with GDP falling to as low as 6 percent in the last quarter. Economists are predicting only slight signs of improvement in the GDP this year. However, an analysis in October 2012 did show that the manufacturing and production sector are picking up.

The current situation reminds me of the economic crises that hit our country a decade ago. In 1991, P.V Narasimha Rao turned to Manmohan Singh, making him the finance minister, to overcome the financial crises the country was in. He succeeded in bringing the country back on track as far as the economy was concerned. And today a revolutionary economic revolution is in call for by Mr. Singh’s government.

The UPA have been staunchly criticized for its incapability to act for the past few years of its ruling. They have been written off the 2014 elections.

But a satisfactory and promising budget this year could probably affect the way the votes swing in the 2014 elections. Maybe we all could have something to look forward to.

Hari Krishna

Image Source [http://l3.yimg.com/bt/api/res/1.2/jTd_wSN6p9tJWQEVMNPEUg--/YXBwaWQ9eW5ld3M7Zmk9aW5zZXQ7aD00NzM7cT04NTt3PTYzMA--/http://l.yimg.com/os/624/2013/02/18/5costs-TS-jpg_123436.jpg]

The picturesque town of Davos, Switzerland hosted the World Economic Forum (World’s biggest focus group), last month.

In its 43^rd year, the Swiss mountain resort of Davos invited nearly 40 Heads of the States, many of the world’s most influential bankers and top multinational corporation heads.

World Economic Forum (WEF),  is a non- profit foundation based in Geneva. It is committed to engaging leaders of the world  to shape the global and the local agendas.

Though the five day event does not deliver any concrete results, it articulates the pressing concerns of today’s time. Apart from that it also gives these leaders a stage to raise the economic concerns and indulge in cross-country debates.

The theme of the 43rd World Economic Forum Annual Meeting was “Resilient Dynamism.” The leaders talked about the various problems and threats that the world economy faced and how it has been a resilient force during tough times.

The main topics of discussion were the Euro zone and the popular protests against capitalism across the globe. And Occupy Wall Street and its siblings and the failing business confidence were some other topics that formed the crux of the discussions.

However, the best Davos moments are on the sidelines where 2500 business leaders, politicians and think tanks, interact and seal deals.

Its not surprising that sometimes many high powered people don’t even attend a single session as they have back to back meetings with potential business partners and politicians. Because it is here that you have all the big industry czars under one roof.

Davos has become adept to provide global social environmental agenda to balance off its business role. The high life, food and fine wine flow freely as business deals are cracked. The various heads of the state and financial heads of developing countries like Philippines, Malaysia, Finland, and South Africa were there to find their moments of glory and boost investor’s sentiments towards their countries.

Even many Indian corporate bigwigs show up to sell India Inc.’s growth story. However, this year it’s been a bit tough.

Because the Indian growth story seems to have run into policy tangles and convincing others has been difficult. Various industry czars like Asim Premji, Rahul Bajaj, and Chanda Kochhar have blamed it on the disruptive role of opposition and the silent role of the government. Our commerce minister Anand Sharma met global companies like Tesco, Diego, Standar Charter and many more.

Among the other International visitors were British Prime Minister, David Cameron, WTO Chief, Pascal Lamy, and IMF Chief, Christine Lagarde.

When Christine Lagarde the IMF Chief addressed the WEF, she said that the year 2013-2014 will be the make or break year for the economy as it shows hopes of reviving. She also dedicated a few words to the Indian daughter (the recent Indian rape case victim) and Malala Yousafzai (known for education and women rights activities) and demanded for gender equality policies.

World economy is going through a transitional phase and the policies across the world will make or break it. So lets just wait and watch how this economic year is going to turn out.

Smriti Sudish

Image source: http://www.jordanoholic.com/blog/world-economic-forum-jordan-2011