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India seeks additional World Bank funds for emerging nations
Region’s entrepreneurs use research, innovation to carve global niche
CII identifies healthcare, IT as key areas for Indo-Pak trade
TRAI seeks more information from telcos on tariff hike
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Tax liability of FDs falls on legal heirs
Week ahead likely to be fairly quiet
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India seeks additional World Bank funds for emerging nations
Washington, September 25 “While we appreciate the need to focus on stability issues, additional resources for MDBs (Multilateral Development Banks) are also necessary for sustaining growth in developing countries and rebalancing global demand,” Indian Finance Minister Pranab Mukherjee said here. He was participating in a discussion on Development Agenda (Infrastructure and Food Security) for G-20 Development and Finance Ministers' Meeting here on the sidelines of the annual meeting of the International Monetary Fund and the World Bank. “At present very little funding is available with MDBs relative to the large requirements of EMDCs (Emerging Markets and Developing Countries),” Mukherjee said. The MDBs are institutions that provide financial support and professional advice for economic and social development activities in developing countries. The MDBs typically refer to the World Bank Group and four Regional Development Banks (RDBs) — the African Development Bank, the Asian Development Bank, the European Bank for Reconstruction and Development and the Inter-American Development Bank Group. Mukherjee said that India has been pushing for financing of infrastructure in emerging market countries as a special area of emphasis within the Seoul Development Agenda. Mukherjee said that Prime Minister Manmohan Singh, which speaking at Seoul at that time, had "underscored that recycling surplus savings arising out of global imbalances into investment in developing countries for infrastructure and development on a large scale was the best way of rebalancing global demand." “We feel that MDBs and RDBs have a major intermediation role in this regard. While the G20 has trebled the resources available with the IMF over the past few years, commensurate ambition has not been forthcoming in the case of the World Bank,” Mukherjee said. —PTI
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Region’s entrepreneurs use research, innovation to carve global niche
With belief in their projects, entrepreneurs from the region have carved a niche for their start-up projects not just in the country, but even in the global corporate world. The mantra for these companies, Altruist Technologies, Chemical Resources and Adi Group — is innovation. Altruist Technolgies: Value Added Solution Provider
Altruist Technologies, a value-added solution provider, has managed to clock a turnover of Rs 120 crore in six years since its started operations. The company started its operations in Shimla. Its clientele includes top cellular service providers like Airtel, Aircel and Idea Cellular. Anuj Aggarwal, director of the company said that they are now expanding their business in 20 countries across Asia Pacific and Africa. Altruist has recently acquired a company. “Our USP is the ability to launch new VAS packages and make them available not just through the cellular operators but also through handset manufacturers and chip manufacturers. We hope to be a Rs 200 crore company by 2013,” he said. Chemical Resources: R&D based nutraceutical firm
Research is driving the fortunes of Panchkula-based Chemical Resources. A technological breakthrough that helped find active ingredient in fenugreek seed that helps cure diabetes, led Panchkula-based Pawan Kumar Goel, to turn his start-up nutraceutical venture into a Rs 12 crore company in less than six years. Now recommended by NIPER as one of the big technological achievements, the company’s best-selling drug, Fenfuro, is helping combat diabetes. “We are supplying our range of nutraceuticals to top formulation companies in the US. This year, we are looking at 65 per cent growth in the turnover,” he said. Adi Group: Clinical Trial Data Management company
For Adi Group, which is a clinical trial data management company, its ability to innovate in product development as well as marketing strategy and managing poaching, has helped him grow and carve a niche Maneet Singh, president of the group, said: “We will soon get into the highly specialised business of doing clinical trials in peripheral artery (cardiovascular) diseases,” he said. |
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CII identifies healthcare, IT as key areas for Indo-Pak trade
New Delhi, September 25 The suggestion comes ahead of the visit of Pakistan Commerce Minister Makhdoom Amin Fahim to Mumbai and Delhi from September 26-30. A large Pakistani trade and industry delegation would accompany the minister. The CII is also organising an interaction of the delegation with Indian businessmen on September 29. A recent CII study on Indo-Pakistan Economic Relations has shown that increased exchanges in these sectors would not only boost bilateral cooperation, but also help strengthen people-to-people links. CII believes that India-Pakistan trade and investment linkages are critical to the overall relationship. Increased business exchanges would spark greater economic cooperation. Currently, the South Asian region underperforms as compared to other regional economic groupings and inter-regional trade and investments are low. Pakistan is India’s 3rd-largest export destination and 4th-largest source of goods among South Asian Association for Regional Cooperation (SAARC) countries, not commensurate with its status as the second-largest SAARC member. The CII study also emphasises other mechanisms for promoting economic cooperation, such as visas, trade infrastructure, transport linkages and scaling down of tariff and non-tariff barriers.
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TRAI seeks more information from telcos on tariff hike
New Delhi, September 25 "TRAI has received replies from various operators and we have asked for some more inputs from some of the service providers for their reasons to hike tariffs," a source said. Earlier, the regulator had sent letters to all the companies that recently hiked tariffs, seeking their justification for the tariff hike. Bharti airtel, Idea Cellular, Vodafone and Reliance Communications recently raised tariffs for their services by about 20 per cent in most operating circles. Industry experts are of the view that the hike in mobile tariffs is anti-consumer and it will only result in an abnormal increase in companies' profits. Most of the operators have been given spectrum free of cost so that they can provide affordable services.— PTI
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Tax liability of FDs falls on legal heirs Q I am a senior citizen. I have made a long-term fixed deposit jointly with my son/daughter etc. Being a senior citizen, am I eligible for a higher rate of interest on deposits. However, suppose I pass away and there is time for the deposit to mature. Kindly advise: a) Will the deposit, in the same name continue, to earn interest at the same rate or it will need redrafting in the name of joint holders with normal rate of interest etc. b) What will be the tax liability of the joint holders? c) Can the deposit be continued for the entire period, if the deposit is long-term say five years d) Will the sequence/ order of names of joint holders determine the tax liability thereafter or it will need different clarification/ version on tax liability? —ON Singh A: Your queries are replied here under: a) In case of your death, the bank, on the basis of such information, should prepare a new FDR in the name of remaining joint holders. The new FDR would be prepared on the basis of applicable rate of interest. It may not be the rate, which is applicable to senior citizens. b) The tax liability would be that of legal heirs. In case, joint holders are not the legal heirs, they would be accountable to the legal heirs with respect to the principal amount as well as interest due thereon. c) The new deposit would be made on fresh terms and conditions. d) Kindly refer to reply in (b) above in respect of the tax liability. Rent income tax
Q My father used to file his return of income showing income from rent on receipt basis and was assessed accordingly up to assessment year 2010-11. In 2010-11, he received Rs 1 lakh by way of enhancement for the last six years as the govt department tenant enhanced the rate of rent with retrospective effect. Will the sum be taxable in the A.Y. 2011-12? Can it be spread over the last 6 years? Is there any provisions of tax relief in such cases, like u/s 89 (1) of it act? What are the provisions of the Act governing such cases? — Safir A: In accordance with the provisions of Section 25 B of the Act, the amount of arrears of rent would be taxable in the year of receipt and treated as income from house property. You would, thus be able to claim statutory deduction of 30% from such an amount. NHAI bonds redemption
Q: I have a basic question that is whether the amount received on redemption of NHAI, REC bonds is taxable in the hands of assessee which was earlier invested from the sale of capital asset for tax saving purpose and I have already paid tax on interest from bonds on due basis and if taxable what is provision in IT
ACT for tax saving. — Ashish Duggal A: The amount received on redemption of NHAI /REC bonds purchased under section 54EC of the Income-tax Act 1961 (The Act) so as to claim exemption from the taxability of a long term capital is not taxable being in the nature of a capital receipt. |
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Nowadays, with advancement in medical research, living standards and the physical activity level of people, the concept of retirement has undergone a change. One can view this as the end of 1st innings and the beginning of the 2nd one. Taking the average age of retirement as 60 years, and considering that most people live till the age of 85 to 88 years, there is still 25 - 28 years of life after retirement, a considerably long period for which one must plan well in advance. Keeping this in mind, planning for life after retirement assumes much greater significance. The age at which a person retires varies from person to person and from profession to profession. There are certain professions where one need not retire. For example, a doctor or an advocate can continue to practice even in their 70s or mid 80s. On the other hand, there are people in government or some private jobs, who retire at 60. Then, there are some short span professions, where retirement comes early, like in the case of pilots, athletes, sports persons, film actors, etc. For example, a cricketer works for maximum 10-12 years in life, from approximately 22-34 years. Thus, retirement age differs for different professions. Interestingly, in recent times, it indeed has been a cherished goal and desire of people to retire early and spend their lives the way they want to. In the same context, we have come across several successful executives working in various reputed organisations who wish to retire at an early age of 45 or 50 years, and pursue hobbies like running a charity or an NGO, writing books, travel, etc. Undoubtedly, they plan to earn sufficient money during their working years to fulfill this dream. Thus, we see that the entire concept of retirement has undergone a change in the last 20-25 years. Still, retirement planning remains one of the most significant milestones in a person’s life and the most neglected too!! Planning for retirement is a six-step process. The first step is to decide your retirement age. It need not necessarily be 60 years; it could be different such as 65 years in case of professors, 50 in case of pilots, 40 in case of air hostesses, etc. Calculate the monthly amount
The second step is to calculate the amount of money you would require post your retirement on a monthly basis, in order to maintain a similar lifestyle as before, which is an important desire for the majority of people. The amount again will vary from person to person, depending upon the status that one enjoys and the financial success one might have already attained. Adjust the amount calculated
previously, accounting for inflation
The third step in retirement planning is to find out what would this amount be equivalent to in the year of retirement, taking into account the inflation. For example, if X plans to retire in 2035, the current year being 2011, and he would need Rs 1 lakh a month for his expenses in the current scenario, then he would probably need approximately Rs 4 lakh a month (assuming inflation at 6% to 6.5% per annum) in 2035, in order to enjoy the same standard of living. Thus, inflation plays an important role in order to arrive at the exact amount that would be required post retirement. Get an idea of the lump sum amount needed at retirement
The fourth and next step is to find out the lump sum amount which you must have accumulated at the age of retirement, so that when invested in safe securities or instruments, it would yield decent returns, enough to maintain your lifestyle. Let’s say, the post-retirement amount required by X after adjusting inflation is Rs 2 lakh a month, ie Rs 24 lakh a year. By assuming returns to be safe at 8% per annum, he should accumulate a corpus of Rs 3 crore by the time he retires, so that, when he invests Rs 3 crore at 8% rate, the earnings would be Rs 24 lakh annually, ie Rs 2 lakh per month. Work backwards to get monthly amount to be invested now
The fifth step then is to work it backwards and find out the amount that needs to be invested every month now, so as to reach the figure of Rs 3 crore by retirement. The amount can be invested through various kinds of instruments like Diversified Equity Mutual Funds, Public Provident Fund Account (PPF), and Employees Provident Fund contribution (in case you are working). This would work as a proper asset allocation between debt and equity. How should one divide his/ her savings between debt and equity, the two most important investment asset classes. As a thumb rule, 80 minus your age should be the percentage invested in equity mutual funds and the balance in debt schemes like PPF or Fixed Maturity Plans (FMPs) or Monthly Income Plans (MIPs) of Mutual Funds. For example, at 40 years of age, 80 minus 40, ie 40% of the investible amount should go into equity and remaining 60% into debt. As you approach your retirement age, it is advisable not to take too many risks. A key aspect of retirement planning is not to withdraw or use any of the investments which have been earmarked to retirement, to meet other goals. One must keep in mind not to transfer his/ her savings or assets in their children's name during their lifetime, as there have been instances of money being wasted and retirement funds being exhausted by children. Children should only be made nominees, so that the money gets transferred to them, post one’s death. Monitor your investments every
3-6 months
Monitor your investments every 3-6 months to ensure that your scheme selection is appropriate, which ensures discipline. When it comes to choosing diversified equity mutual fund schemes for retirement corpus, one should invest about 50% in large cap equity funds and about 20% to 30% in mid cap, small cap or flexi-cap funds. The remaining can be invested in thematic funds like gold funds or infrastructure funds, etc. Planning for a house is another key area. There are people who inherit a home and are saved from this planning, while there are others who do not inherit a home and have to plan for it. The latter category should start working towards this goal simultaneously, while working. Their savings need to be divided between Equated Monthly Investment (EMI) for the house and the balance for Public Provident Fund, Employee Provident Fund and diversified equity mutual funds. For post-retirement life to be comfortable, one might have to compromise on lifestyle during youth. If you have planned well and have accumulated a good corpus, it would not only lengthen your life, but would also improve your mental, social and physical confidence. The benefits of starting to plan early for retirement cannot be overemphasised. Remember, it's never too late!! Views expressed are the author’s own
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Week ahead likely to be fairly quiet
The markets last week were literally a nightmare and the kind of volatility seen does not augur well for our markets. The markets fell on Monday, had a huge upside gaining a staggering 354 points for virtually no reason on Tuesday, lost a small and insignificant 34 points on Wednesday and then it was a crash on Thursday when the markets lost 704 points. Friday saw the fall continuing with a loss of 199 points. The broader markets like the BSE100, BSE200 and BSE500 lost between 3.3% to 3.90%. The BSE MIDCAP and BSE SMALLCAP lost 2.62% and 2.38% respectively. The surprise amongst the pivotals was the SBI which gained Rs 10 to close at Rs 1,956. Reliance lost 6.77% and Hero Honda lost 7.45%. Foreigners were big sellers in the last two day and have sold in excess of Rs 2,600 crore. The rupee has been under pressure and closed at 49.43 to a dollar. With hardly any good news, concerns about Europe and the US, markets had to weaken and they did. Advance tax numbers for the September quarter are not to encouraging and weak quarterly results are now more or less a certainty. With this last fall all those people who believed that the markets had bottomed out have changed their opinion and with pessimism returning, it appears, the markets are likely to bottom out. The week ahead would see the September series expiring on Thursday September 29. Intra-month, there has been huge volatility, but on a close-to-close basis so far it appears to be a very narrow movement month with the closing of the previous month being 16,146.33 points on the SENSEX and 4,839.60 points on the NIFTY. The week starting Monday is likely to see a stronger and positive start. There would be plenty of intraday moves and the week is likely to end on a flattish or neutral note. The SENSEX has support at 16,020, then at 15,842, then at 15,705 and finally at 15,525 points. It has resistance at 16,336, then at 16,528, then at 16,652 and finally at 16,884 points. The NSE NIFTY has support at 4,821, then at 4,742, then at 4,742, then at 4,770 and finally at 4,655 points. The week ahead is likely to be a fairly quiet week compared to the previous one. Arun Kejriwal is founder of KRIS, an investment advisory firm. Views expressed are his own
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Washington, September 25
Today, retirement is not the end of the world. For most of today’s youth, it would be a chance to live the life they
always wanted. Is a dream retirement possible? Anil Chopra, Group CEO, Bajaj Capital, provides you a plan for it
etirement is the point in life where a person stops working and starts pursuing his hobbies, for which he did not have time earlier. Do we still need to dread it? The answer is no. Gone are the days, when retirement was viewed as the end of life, after which people used to live for a maximum of 5- 10 years and that too with bad health.
Chandigarh, September 25
Today, retirement is not the end of the world. For most of today’s youth, it would be a chance to live the life they
always wanted. Is a dream retirement possible? Anil Chopra, Group CEO, Bajaj Capital, provides you a plan for it
etirement is the point in life where a person stops working and starts pursuing his hobbies, for which he did not have time earlier. Do we still need to dread it? The answer is no. Gone are the days, when retirement was viewed as the end of life, after which people used to live for a maximum of 5- 10 years and that too with bad health. 
