M A I L B A G

Our investors must tread with caution

There is often a popular preference for FDI and FII on the assumption that FIIs are fair-weather friends. FDI, by contrast, has a lasting interest in the company and stays with it through thick and thin. FIIs are blamed for the present downward trend in the Indian stock market. While there is some merit in this inference, certain factors must be taken into account.

First, all portfolio investors, domestic or foreign, are fair-weather friends. They exit once it becomes clear that they will lose money by staying invested in a particular company or market.

Secondly, these days the strength of domestic home grown entrepreneurship in India is widely acknowledged. This entrepreneur class prefers to have portfolio investor who shares the project and business risk without interfering in the critical management decisions of the company. Thus, there may be preference for FII over FDI as far as this class is concerned.

Finally, India has done well in creating the institutional mechanisms of a modern liquid equity market. India’s share in global portfolio flows is higher than its share in global FDI. It will be prudent for Indian investors to be cautious while investing in the stock market and check the fundamentals properly instead of blaming FIIs for all the ills in the stock market.

Dr MANDEEP SINGH, Yamunanagar

Daylight robbery

I do not know why the authorities concerned have failed to check corruption in local, private and government buses plying in our region. There is hike in the bus fare for a trip of 3-5 km distance. For a trip, we are forced to shell out Rs 4 per commuter out of which Rs 2 goes to the conductor’s pocket.

What are the so-called “flying squads” doing? — encouraging corruption? The government should take prompt measures to end this daylight robbery of the commuters.

A.K. SOBTI, Naya Nangal

Pitfalls of ECHS

This refers to the new item, “Western Command modifies policy on treatment” (June 12). The medical facilities to the ex-servicemen were extended after 1962. Before the introduction of the Ex-Servicemen Contributory Health Scheme (ECHS), medical facilities were extended to only ex-servicemen, their spouses, unmarried daughters and sons up to the age of 24 years.

The ECHS is okay, but why was the facility extended to the dependant parents of the ex-servicemen? This is a burden on the exchequer and has resulted in perpetual shortage of medicines. Defence is not a charitable organisation. The authorities should put an end to this kind of charity.

JATINDER GILL, Chandigarh

Breach of faith

This has reference to the editorial, “Illegal turns into legal: Punjab emulates Delhi” (June 6). One is reminded of the Congress’ tall election promise to voters like providing an honest and efficient administration in Punjab. People believed the Congress and voted it to power. It is altogether a different story today.

Ironically, the Punjab government has lost its concern for the people. Of 12,400 villages, 11,849 are “problem villages” where drinking water is shoddy, farmers have huge debts, dropouts in schools are increasing, the health care system is ailing, and some unemployed youth have taken to drugs.

Having regularised illegal structures, the ruling party will have to pay a heavy price in the ensuing Assembly elections for breach of people’s faith.

AJIT SINGH, Windsor (Canada)

Hold the price line Though two Union budgets were presented in the name of aam aadmi, the middle income families are angry with the Congress-led UPA government because the high hopes of people for a respite from the skyrocketing prices have been belied. The salaried class babus’ pockets are full of holes. The kitchen budget of the family has been shattered due to rising prices of vegetables, fruits, pulses, milk, refined oil, rice and flour. Disturbingly, the average price of urd and moong dals, around Rs 30 a kg in 2004, is now Rs 60 a kg! All the political parties are silent except enacting nautanki off and on. They are busy in frittering away their time and energy on trivial matters. D.V. JOSHI, Bartana (Zirakpur)