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Monday,
March 25, 2002, Chandigarh, India  
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All about health insurance
Car, bike
exports move ahead
No major
initiatives likely
in Exim policy |
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Inflation rate dips to 1.51 p.c. New Delhi, March 24 Inflation rate dipped slightly by 0.13 per cent to 1.51 per cent during the week ended March 9, mainly on account of cheaper wheat, tea, cotton, jute, vanaspati and coconut oil.
Housing loan
Consumer movement gains ground in small towns
Invest in Glaxo, Pfizer & Aventis
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All about health insurance The opening of the insurance sector has attracted domestic and foreign private players into the life and general insurance sector. This has directly resulted in the expansion of insurance market including substantial increase in mediclaim insurance. The experts in the insurance business say that due to lack of awareness and appropriate policies, the unlimited medical insurance market has not been fully tapped so far. The officials at the New India Assurance Company’s regional office here, claim that despite absence of private players so far, more and more people are opting for the mediclaim
policies. The increase in common diseases, growing income levels and decline in medical cover by employers have forced the middle class to opt for this policy. The cost of treatment has also increased manifold. They pointed out that four insurance companies — New India Assurance, Oriental Insurance, United India and National Insurance, which were earlier subsidiaries of the General Insurance Corporation ( GIC ), have now become autonomous bodies, but their mediclaim policies, like other policies, are more or less same with minor variations. However, under the new guidelines, implemented from January 1, 2002, the premium of mediclaim policy has been revised upward by 15 to 30 per cent for different age-slabs. Mr Tilak Raj Kunra, one of the leading Development Officers of The New India Assurance, says, ‘‘Any person between the age group of 5-80 years can take mediclaim policy by paying a pre-determined annual premium, fixed according to the sum assured. Afterwards he can claim the expenses for his treatment during the policy period provided he gets his treatment from a recognised hospital or nursing home for more than 24 hours or claim the expenses up to a certain limit for treatment at home if the facility is not available at hospital.’’ According to the revised terms and conditions, he says, any medically fit person aged up to 35 years can take up mediclaim policy for Rs one lakh by paying an annual premium of Rs 1236. The policy holder would have to pay additional premium after attaining a particular age. The annual premium for the same policy would be Rs 1344 for age group of 36-45; Rs 1924 for 46-55; Rs 2191 for 56-65 year age group excluding service charges. However, one can avail tax benefits under Section 80 D of the Income Tax Act. The policy holder would be entitled, for Rs 1 lakh policy, to claim overall medical expenses up to Rs 1 lakh including Rs 20,000 for domiciliary hospitalisation. However, he should not be inflicted with that disease before taking the policy. Another official of The New India Assurance, says,‘‘ During the first year of the operation of the insurance cover, the expenses on treatments of diseases such as Cataract, Benign Prostate Hypertrophy, Hernia, internal diseases and defects are not payable. In case of any controversy, the matter is decided by a panel of the insurance company.’’ The company is also running a Cancer Insurance Policy in collaboration with a Tata medical institute. However, the policy is not so popular here. Mr Kunra adds that the company is also providing five plans under Overseas mediclaim policy for persons going abroad for business, holiday, employment or study purposes. Under that policy, any person, between an age of six months to 40 years, can take mediclaim policy worth $ 50,000 for 61-75 days for any country except the USA and Canada, by paying a sum of Rs 1380 plus 5 per cent service charges. Mr Rajeev Khanna, Divisional Manager at the United India, says,‘‘ The mediclaim policy is becoming popular day by day. We have also specific policies for heart treatment, cradle and trauma care. However, most of the workers are not aware of these policies. Besides, since most of the industrial workers are covered under the ESI Act, so they do not take up these policies. The policy is mostly taken by businessmen, executives and industrialists.’’ Mr Rakesh Mohan of Bajaj Allianz also pointed that the company was in the process of launching mediclaim policies. These are likely to be started by April, and would have better risk cover plans than most of the public sector companies. The Reliance Insurance, Ifko Tokyo and Tata-AIG are likely to start these mediclaim policies soon. Under the mediclaim policy, says an official of the New India Assurance, one can also avail 10 per cent discount in premium if the policy is taken for spouse, eligible dependent children, dependent parents or other family members. The employer can also take take group mediclaim scheme to provide medical cover to the employees. He added that under the group policy, the company would give a discount of 2.5 to 30 per cent in premium depending upon the number of policy holders. The enquiries at The New India regional office revealed that the company sold about 15,000 policies in the state. In the total general insurance business in the state, it has a share of about 30 per cent. The total number of mediclaim policy holders in the state is around 50,000. The potential is anywhere between 10 lakh to 15 lakh policies, provided suitable policies are introduced by the companies. The officials of the insurance company say that they have failed to concentrate on this area due to fixed premium and large number of unscrupulous elements, who in association with some doctors try to cheat the company by putting false claims. Some of the medical institutes have been found taking money from the so-called patients to issue false certificates. It has resulted in heavy losses and the government has been forced to increase premium rates. Commenting on the allegation, Dr Satish Jain, Medical Director and Chief of Surgery and Oncology at Oswal Cancer Institute here, admits, ‘‘No doubt a section of doctors may be involved in this malpractice but there is a general tendency among the insurance officials to create hurdles at the time of claims. Moreover, despite a visible increase in mediclaim policy holders, there is lack of awareness among the masses. Even doctors are not aware about most of these policies. The companies should create mass awareness in association with medical institutes and medical fraternity.’’ Mr P.S. Ahuja, a mediclaim policy holder says,‘‘ The policies are certainly good and cover a risk for the medical treatment, but it is very difficult to collect money from the company in case of illness or diagnosis after paying premium through our nose. I was not paid any claims for the doppler and other test for kidney disease. The officials termed them just a fraud resulting in lost of my faith and termination of the policy.’’ The Insurance officials admitted that due to some bad elements, sometimes genuine policy holders have to suffer, but companies are trying to improve the services. With the entry of private players the competition would hot up, ultimately benefitting the consumer. Annual premium for Rs 2 lakh mediclaim
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HOW I STARTED The market for reasonably priced hygienic processed food items is limitless in Punjab and other states. Despite state government’s off-repeated agro-processing schemes, very few entrepreneurs have succeeded to set up viable units. Among these, Mr Gurinderjit Singh, (39), a graduate in agriculture and management here, has made a name by selling processed meat under brand name ‘All Time’ to all the leading hotels and super market stores in the
region. Within short span of eight years, his annual turnover has crossed over Rs 1 crore. Mr Gurinderjit Singh, Managing Director, Hygienic Poultry (P) Ltd., claims that he is running an automated fully environment-controlled meat processing unit and a poultry farm, only one so far in the state. Sharing his experiences, he says: Initial phase After doing BSc in agriculture and MBA from Punjab Agriculture University (PAU), by 1984, I joined the National Fertiliser Limited, and worked for nine years as an Area Manager. However, I could not adjust myself there due to day to day interference of the officials and politicians. Once I declined to oblige my senior officials to do an illegal work, they transferred me to Gwalior. I decided to look for other avenues instead of going there. Though my parents were in teaching line, but my younger brother, a charted accountant by training had already started hosiery trading. I asked him to look for some avenue for me. How did I start my present career? In 1993 I had decided to quit my job. During that period, one day I met some officials of the Punjab Agro Industries Corporation, and was highly impressed by the idea of starting an environment-controlled modern poultry farm. I visited Bombay and Pune to get first hand information about these modern farms. My brother, who was also convinced about the idea, helped me prepare a project report to set up a large scale farm worth Rs 1.25 crore. I decided to sell family house to raise an amount of about Rs 20 lakh. Some friends and relatives also helped. The Canara Bank sanctioned a loan worth Rs 70 lakh without much difficulty. Hence I started the first modern poultry farm of the state with a capacity of 75,000 birds. Role of university education My agriculture education at the PAU, undoubtedly helped me develop an attitude towards agro-processing career, however, I had not even heard about the hi-tech farms during my whole degree courses there. Unfortunately, the courses are virtually outdated and have no touch with the latest developments in technology. I feel that the our agriculture education has failed to inculcate a spirit of entrepreneurship among students. For instance, I am keeping three birds in one square feet space, but the university is still teaching concepts of one bird in one square feet space. Any setbacks? Initially, my friends and even teachers laughed at my decision to set up a large scale poultry farm. But I was fully convinced about the success. I also failed to get 30 per cent capital subsidy promised by the Industry Department under State Industrial Policy. It was later slashed down to 20 per cent on the recommendation of some PAU experts, who did not find the plant as a modern one. I have not received even that amount so far like thousands of entrepreneurs in the state. What is my experience in this profession? Initially with sheer dedication and updated technology, I was able to ensure low mortality rate of birds and to provide bacteria-free broilers to the customers. I earned good profit. Later number of persons in the neighbourhood started large scale farms and thus affecting the profit margin. With the passage of time, I realised that it was a seasonal market, where broiler prices used to dip in summer season. I decided to explore the forward linkages by establishing a meat processing plant in 1998-99, and have started sale of about 20 processed items under the brand name of ‘All Time’ I always try to cut down overhead costs and add value to customers’ money. Now my immediate plan is set up a chain of sale counters in all major towns of the region, where the customers, especially ladies could come comfortably to purchase nutritious processed meat products at an affordable price. — MK
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Car, bike
exports move ahead
New Delhi, March 24 Car exports shot up by a whopping 105 per cent at 42,444 units during April-February this fiscal on the back of a superb performance by Ford India which accounted for more than half of the total exports, data compiled by the Society of Indian Automobile Manufacturers (SIAM) showed. The Indian subsidiary of US auto giant Ford Motor Co shipped 27,572 units of its mid-size car ‘Ikon’ to countries like South Africa and Mexico. Car market leader Maruti Udyog, however, posted a 35.7 per cent dip at 8,559 units during the review period. South Korea’s Hyundai also witnessed a 14.5 per cent decline in exports at 4,494 units (5,260 cars a year-ago). Car exports of Tata Engineering (Telco) surged ahead by 261.6 per cent at 1,689 cars (467 cars) while that of General Motors slipped to 40 cars year-on-year from 69 units. In sharp contrast to passenger car segment, commercial vehicle exports slumped by 19.9 per cent at 9,683 units (12,092 units). Ashok Leyland, India’s second largest commercial vehicle maker, reported a 6.7 and 4.8 per cent drop in M&H and LCV exports at 1,725 units and 98 units respectively. However, exports of LCV makers like Eicher, Swaraj Mazda and Mahindra and Mahindra rose by 61.6, 56.5 and 68.2 per cent at 1,062, 321 and 274 units respectively. Two-wheeler exports went down by 9.2 per cent to 91,731 units as scooter and moped exports declined by 15.7 per cent and 41.7 per cent at 19,369 units and 22,801 units respectively. However, exports of motorcycles recorded a 27.2 per cent rise at 49,561 units during the review period. Hero Honda Motors posted a 29.4 per cent rise at 11,833 units. Exports of TVS Motor dipped by 13.7 per cent to 2,273 units while Royal Enfield saw a rise of 63.6 per cent to 1,357 units. Scooter makers like Bajaj and TVS posted a 31.5 and 137 per cent jump in exports at 7,996 and 867 units respectively while LML and Kinetic exports dipped by 27.8 and 57.5 per cent to 6,709 and 3,072 units. In the mopeds segment, all the players excluding TVS Motor recorded a drop in exports while three-wheeler exports fell by 11.4 per cent at 13,472 units.
PTI
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No major initiatives likely
in Exim policy
New Delhi, March 24 Just as in this year’s Budget, the Exim policy would seek to carry forward reform measures already announced instead of going in for a slew of new measures, official sources told PTI here. The policy, which would aim at pushing exports to $ 80 billion annually by 2007 to have one per cent share in world trade, would retain all the export incentives including the popular Duty Entitlement Passbook Scheme (DEPB) and duty drawback schemes till such time Indian exports become competitive. Sources, however, said DEPB rates are expected to be lowered corresponding to lowering of peak customs duty rates from 35 to 30 per cent in the Budget as part of the rationalisation of export incentive schemes. Apart from measures to encourage SEZs, the Exim policy would contain schemes to promote industrial clusters like Moradabad for brassware, Tirupur for hoisery, Ludhiana for knitwear, Sivakasi for crackers and Agra for shoes.
PTI
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Inflation rate dips to 1.51 p.c.
New Delhi, March 24 The inflation rate, based on wholesale price index (WPI) for all commodities, came down from 1.64 per cent in the previous week and was still much lower than 6.71 per cent a year ago. Inflation rate came down during March second week despite the 0.1 per cent hike in manufactured products with primary articles and fuel group indices remaining static.
PTI
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Housing loan Q: My husband has purchased a residential plot in my name from his savings. I am a household lady and no income. My husband is an officer in a nationalised bank. He has taken housing loan of Rs 7.5 lakh against this plot from his bank for construction purpose. Please advise: (i) Whether I can issue him a rent receipt for claiming HRA from bank? (ii) Whether I have to file I Tax return though I have no taxable income? (iii) Whether my husband can claim tax rebate of interest which is debited to his housing loan a/c and upto what amount? (iv) Whether he can also take rebate for his repayment of housing loan instalment under Section 88 to the tune of Rs 20,000/-. We have constructed the house in this financial year. Sarita Kaushal, Phillaur Ans:
You cannot issue a rent receipt to your husband for claiming tax benefit in respect of his house rent allowance because the house although standing in your name has been purchased out of the savings of your husband. Hence, for the purpose of income-tax this house belongs to your husband only. You have not to file your income-tax return because you have not received any rent. Your husband can claim tax deduction in respect of interest paid by him because the income from property is taxable in his hands as the same has been financed by him. The tax rebate for housing long u/s 88 can be availed by your husband because the income from property is assessable in his name.
Farm land Q: I have sold part of my house for Rs 15 lakh. It was purchased about 30 years back for very nominal price. Please advise if I can save Income Tax by investing this amount for the purchase of agricultural land in my name or major son’s name or by buying housing plot in the name of major son. Otherwise, please suggest any other way to save income-tax. H.S. Ahuja, Ludhiana Ans: To save income-tax on the long-term capital gains arising to you on selling your old house you may invest the long-term capital gain amount in certain bonds of Nabard, NHAI, REC, etc. For arriving at the amount of capital gains you can take advantage of the concept of cost inflation index. No tax saving is possible by purchasing agricultural land in your name or in the name of your son. If you desire you can make investment in another residential house by investing the amount of capital gain.
PPF account Q: I want to know whether my spouse who has no income of her own, is permitted to open a PPF Account on her name. If yes, then shall I get benefit under Section 88 of Income Tax Act on contributions made by me in her PPF account. My date of birth is 1.12.1937 and as such I will attain the age of 65 years on that date. Shall I get the rebate of Rs 15,000 on Income-tax given to senior citizens in full or on pro-rata basis during the financial year 2002-2003 onwards. R.P. Gupta, Paunta Sahib Ans:
Your wife can open a separate PPF account in her name. However, on contributions made by you to the account of your wife you will not be eligible for any rebate u/s 88. During the F.Y. 2002-03 you will be completing 65 years of age hence you will be eligible to receive the tax rebate of Rs 15,000 for the full year. There is no system of granting pro-rata rebate. |
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Consumer movement gains ground in small towns I have some good news for consumers. The consumer movement, which had so far remained an urban middle class movement in India, is slowly inching towards small towns and villages in the country. And those who are responsible for this are mostly a new breed of consumer activists. They don’t run consumer organisations, but are firmly entrenched in the consumer movement and are committed to the cause of consumers. These are teachers in various undergraduate and postgraduate colleges in the country; and their students are not just those who have enrolled for various courses in the college, but also local residents. Last week when a postgraduate college at Charkhi Dadri in Haryana invited me to participate in a workshop organised in connection with the World Consumer Rights Day, I was quite surprised. As it is, not many remember nor celebrate March 15 and this year, the Ayodhya imbroglio had completely overshadowed the cause of consumers. The college was a good three-hour drive from Delhi, but the trip was an eye-opener. The large library where the function was organised was overflowing with students and teachers. There were also local residents. The college — JVMGRR as it was called — had prepared a note on consumers’ legal rights for the audience. Equally interesting was the exhibition organised by the students on fake brands being sold in the local market. From salt and ketchup to medicines and cosmetics, there was a wide range of such goods. Obviously, rural markets provide a fertile ground for those manufacturing and selling such goods. Interestingly, the speakers at the workshop included teachers from various colleges in Haryana and Delhi. One of them, a scientist from College of Home Science, Haryana Agricultural University, Hisar, later told me about the consumer club in their college and how they met local residents every third Saturday of the month to discuss various consumer problems and find solutions. Students were encouraged to choose a topic for discussion at these meetings, with local residents participating. The attendance at these meetings was good and many used the occasion to seek the help of the teachers in filing cases before consumer courts. One of the teachers told me that surveys conducted by students in neighbouring villages had shown that people were slowly becoming aware of their rights. A survey of consumers conducted by the Indian Institute of Public Administration in 1994 had shown that 84 per cent of the population in the country remained totally ignorant about the Consumer Protection Act or the courts constituted under it to resolve consumer disputes. It would be interesting to see if the percentage has gone down in recent years. Some of the teachers I met during the workshop told me that they would like to set up small testing laboratories in their colleges, where local residents from nearby towns and villages could get food samples checked for adulteration. They were keen to conduct regular surveys in neighbouring villages on the incidence of food adulteration, marketing of fake drugs, use of illegal weights and measures, etc. They also wanted to bring out booklets written in local language on the rights of consumers. They were also keen to invite representatives of consumer groups so as to provide students as well as the local residents an opportunity to meet them. In short, they wanted a strong consumer movement in the districts in which they lived. However, they were short of funds and this slowed down their plans and programmes. In Delhi, at least two colleges have taken keen interest in promoting consumer rights and educating consumers: Lady Irwin College and Institute of Home Economics. Now the active role played by teachers in small towns and villages adds a new dimension to the consumer movement and raise hopes that a strong consumer movement could become a reality in India in the near future. In fact for several years now, various consumer groups, as well as the Union Ministry of Consumer Affairs, have been expressing concern over the fact that the consumer movement has not gained ground in rural areas and that rural consumers remain unaware of their rights. I do think that with a little help and encouragement, educational institutions can play a crucial role in bringing together students, parents and local residents and creating the much-needed consumer awareness in villages and towns. For this, however, the Union Ministry of Consumer Affairs has to play an active role. First of all, Consumer Welfare Fund should be made available to colleges with a track record of promoting consumer rights and consumer awareness. Similarly, the ministry should initiate training programmes for college teachers, particularly those teaching in rural areas. These could be similar to the ones conducted by the Indian Institute of Public Administration for non-judicial members of consumer courts. There is also need to facilitate greater interaction between universities and consumer groups for strengthening the consumer movement in the country. In short, there should be recognition of the role of educational institutions in promoting a strong consumer movement. |
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