New Delhi, October 28
Disagreeing with Srikrishna panel's suggestions, Prime Minister Economic Advisory Council (PMEAC) chairman C Rangarajan has said India does not need a super regulator for financial sector markets but need better co-ordination among existing regulators.

"At this particular time, it may be advisable to continue with existing system, rationalise the overlap if there are any and try to improve co-ordination among different regulators," he said when asked about suggestions of B N Srikrishna committee for a single regulator to deal with financial markets.

According to Rangarajan, a former Reserve Bank governor, "We still have not reached a stage in which our various financial segments have developed to full extent." Citing examples, he further said "The experience that is now available does not point to a clear evidence as to which is better. UK had a single regulator and it ran into problems. USA had multiple regulators and they also ran into problems.”

Justice BN Srikrishna-headed Financial Sector Legislative Reforms Commission's draft report has suggested setting up a single regulator for financial markets.

"The draft report talks in terms of single regulator for all financial other than banking. This again is not very consistent," Rangarajan noted.

Recently, the commission in an approach paper had proposed a unified regulator for financial sector laws, including those for markets, insurance, commodities and pensions.

It, however, had proposed to keep banking out of the regulator's purview and had also suggested setting up of a financial redressal agency to address consumer complaints against companies across the financial sector.

The approach paper, on which the commission will seek comments from stakeholders, had underlined the need for establishing an independent debt management office and a financial sector appellate tribunal to hear appeals against regulators.

"These changes will alter the Indian financial landscape from eight financial regulatory agencies to seven," the Paper had said which will form the basis of the report of the commission which was set up in March 2011 to re-write the legislations affecting the financial markets in the country.

Under the existing architecture, the financial sector is regulated by eight agencies including Reserve Bank of India, Securities and Exchange Board of India, Insurance Regulatory and Development Authority, Pension Fund Regulatory and Development Authority and Forward Markets Commission.

As per the proposal, there would be five new agencies besides Reserve Bank and FSDC. The new ones would be UFA, Financial Sector Appellate Tribunal, Financial Redressal Agency, Debt Management Office and Resolution Corporation. — PTI

A skilled workforce is the strength of any country, which not only helps improve the economy but also helps it to face any challenges. Centum Learning CEO & director Sanjeev Duggal, with his unwavering commitment to creating employability in the country, coupled with his entrepreneurial flair and passion for developing people, talks to Girja Shankar Kaura, about how he has shaped the mandate of the firm.

Q: How will you define Centum Learning?

A: Critical enablers of sustainable transformation of business results and individuals across 17 countries in Africa, India, Bangladesh and Sri Lanka. Centum Learning has rich experience in the training and skilling across 20 countries in 21 industry verticals. With more than 1,000 training and development specialists, we work with over 350 leading global corporates, central and state ministries, public sector undertakings. Its training solutions aim at enhancing productivity and business outcomes on one hand, and enhancing employability for youth, on the other.

Q: What are the key focus areas for Centum Learning with respect to the Indian market?

A: In India, Centum Learning is focusing on two broad areas: corporate training and skill development. Under corporate training, we target ET 500 companies across multiple sectors. We have impacted productivity of 20,0000 plus professionals across automotive majors alone. Our training solutions include - sales & distribution training, customer service training, process & compliance training, behavioural training and experiential training and we are domain agnostic.

Under skill development, we target ministries at the centre and state levels, CSR programmes of PSUs. We create sustainable livelihood opportunities for unemployed youth across different social and economic strata including underprivileged segments like the BPL youth, SC/ ST segments.

Q: What is the current skill training scenario in India?

A: The government recognises the need for a skilled workforce and has been making efforts in this regard. National Skill Development Corporation (NSDC) is working towards building a network of partners and enablers to meet this challenge.

For improving skills of 150 million people by 2022 (a target set by NSDC), a well coordinated effort needs to be taken by the government and industry. According to a Planning Commission report, at present only 10% of the workforce in the country has some form of skill training. This is very low when compared to other countries. Moreover, 80% of the new entrants (in the workforce scenario) do not have the opportunity to undergo skills training (according to the Planning Commission report of 2008).

Q: What are the opportunities available to rural youth as far as vocational skills training is concerned?

A: There are thousands of programmes to develop employability skills. Class XII students can look forward to a plethora of vocational education courses that offer value for money.

Centum Learning works end-to-end for rural youth by mobilising, training and placing them in reputed companies.

Q: You have recently announced your tie-up with Everonn Education. What opportunities have opened for the company with this move?

A: This merger will open up a plethora of opportunities for both Everonn and us. This will be their gateway to the Continent of Africa where Centum is already present in over 17 countries. One of the critical requirements for our next phase of growth was availability of technology. Together we have a common goal of creating the world's leading organisation with a robust portfolio spanning education, corporate training and skill development.

Q: What about your international journey?

A: Centum Learning is present in 17 African countries. It has set up Airtel Centum Sales and Service University in India and Africa. In collaboration with Pinnacle LLP, we have launched its first centre in Dhaka.We have plans to offer its world class training solutions in Latin America, Malaysia, Indonesia, Vietnam, Philippines and Myanmar.

New Delhi, October 28
Finance Ministry will unveil the roadmap for fiscal consolidation within a month and make changes in the Fiscal Responsibility and Budget Management (FRBM) regulations, with a view to gradually lower the fiscal deficit to 3% of the GDP by 2016-17.

"FRBM regulations will be amended. The Finance Minister is looking at it and the announcement will be made within a month," Department of Economic Affairs secretary Arvind Mayaram said.

He said the new targets would be mentioned in the regulation to the FRBM Act. The Act proposed reduction of fiscal deficit to 3% of GDP by 2009, but the exercise had to be abandoned as a result of the global financial crisis.

"We are working on how to reduce it and bring down fiscal deficit to 3% by 2016-17. For the current fiscal, we will keep it at 5.35%," he said, adding that an announcement could be made by the minister either in Parliament or outside.

Mayaram said the finance ministry for the purpose of limiting the fiscal deficit at 5.3% would focus on controlling expenditure and raising funds from disinvestments. The Budget for 2012-13 had pegged the fiscal deficit, the gap between revenue and expenditure, at 5.1% of GDP.

"We will not go for additional borrowing. We will curb unnecessary expenditure and also expect to garner adequate resources through disinvestment," Mayaram said.

For the current fiscal, the government aims to raise Rs 30,000 crore by way of disinvestment in state-owned companies.

Finance Minister P Chidambaram, soon after assuming charge, had appointed a three member committee under the chairmanship of 13th Finance Commission head Vijay Kelkar to suggest a roadmap for fiscal consolidation.

The Kelkar Committee in its report had suggested that the government should undertake reform initiatives, go ahead with disinvestments and reduce subsidies. Without these the fiscal deficit could shoot up to 6.1% in the current fiscal, it said. As per the roadmap given by the committee, the Centre should aim to reduce the fiscal deficit to 4.6% and 3.9% by 2013-14 and 2014-15 respectively.

Finance Ministry officials are engaging in hectic parleys with the PSUs to speed up the process of disinvestment so that stake sale can take place in the second half of the fiscal.

To speed up the process, the disinvestment department has secured Cabinet approval for stake sale in five companies -- Oil India, MMTC, Hindustan Copper, Nalco and NMDC -- which could fetch over Rs 20,000 crore to the exchequer. — PTI

In a high inflationary environment where even the day-to-day expenses are going sky high, and the future is almost unpredictable, almost everyone tries to save some amount to ensure some protection for the future. However, the important question here is - are your savings helping you create wealth for yourself? Here, one of the best ways to invest your money for creation of wealth over the long-term is investment in a Systematic Investment Plan (SIP). The process of investing in capital markets, which may be otherwise very tough and time consuming, has become more simpler, systematic and less risky, by the way of investing in SIPs.

What does SIP mean?

SIP means investing systematically on a monthly basis; it is a method of investing primarily in mutual funds, wherein a fixed amount is invested for a continuous period at regular intervals under the same scheme.

As we all know that tasks done in a disciplined and systematic manner deliver the best results in the long run, the same principle applies to the process of long-term wealth creation. SIP is a perfect tool for people who have specific financial requirements. By investing an amount of your choice every month, you can plan for and meet financial goals, like your child's education, marriage, ensuring a comfortable post-retirement life, etc. The amount could be as low as Rs 100 but there is no upper limit on investment. It is especially beneficial for those people, who want to invest in the equity markets, but cannot make lump sum investments.

Rupee Cost Averaging

Talking of the benefits, SIPs help investors in taking advantage of Rupee Cost Averaging i.e. it helps the investor to tide over the ups and downs of the market. In the current situation, where the Indian market is highly volatile, the investors who have invested through SIP are least affected. Yes, today's volatility in the equity markets can be beaten with SIPs. Systematic Investment Plan is a time tested strategy; it has been proven a number of times that SIP is the cure of volatility in the equity market.

Induces Discipline Investing

Also, SIPs ensure that investors continue to invest in a disciplined manner, as one contributes a certain amount each month from his/ her surplus for a SIP payment. Moreover, the amount to be invested is usually not too large, which makes it easier for the investor to pull out a few hundred rupee notes from his monthly expenses.

Checklist

However, there is a checklist of wealth creation though SIPs, which one must take care of. It is

a) Continue to save and invest as long as you are earning

b) Do not stop or break the SIP irrespective of market conditions

c) Always go for perpetual SIPs, as you always have the flexibility to add more or exit

d) Shift to safer options only one year before the goal

e) Allocate funds into a combination (largecap, midcap, value funds, etc)

f) Reduce expenses, not savings

g) With every increase in earning, increase your savings amount by at least same proportion

h) Attach every SIP with a goal and vice versa.

As there are a wide variety of schemes available in the market, it is best to choose your SIP scheme designed to suit your financial requirements, in consultation of your financial advisor. While doing so, you must also evaluate the past performance of the fund. Also, post investing, it is important to keep track of how your fund is faring, and this can be done every 6 months perhaps, by re-aligning the portfolio, if required.

To conclude, India's growth story seems to be positive in the long-run with a potential to attract huge investments and deliver returns as per the investors' expectations. In such a situation, SIP is the best tool to save small amounts each month. The question is not about 'when' to invest, it is about 'how' and 'how much' to invest. So the focus should be on following the right asset allocation and investing through a proper investment process. We recommend that retail investors should not try to time the market and refrain from making lumpsum investment in the market at any time. Instead, they should follow a systematic approach to investment.

The author is the senior vice president (marketing) of Bajaj Capital. The views expressed are his own

The other advantage of investing through SIPs is that it leads to power of compounding. Let us explain this to you with the help of an example - Mohan started investing Rs 4,000 per month at the age of 30, and his friend Sohan started slightly late, at the age of 40 by investing Rs 6,000 per month. When both of them retired at the age of 60, Mohan was a richer man by almost Rs 45,00,000! This is explained with the help of the table given below

My friend's wife was recently the victim of a chain snatching incident when she was taking an evening walk. She raised an alarm and alerted the general public. A few passersby chased the chain snatcher and nabbed him. She managed to get her chain (broken) back. Her first reaction afterwards was to let bygones be bygones (since she clearly had not suffered any loss). But as a good citizen she decided to lodge an official police complaint.

That's when the trouble began!

The police arrived 30 minutes later and arrested the miscreant. My friend's wife went to police station and lodged a complaint. The process took about 3-4 hours to complete. To make it worse, police officials asked her to hand over the broken chain as "evidence" which would be returned to her after the case was over. She was reluctant to do that but had no choice so she handed it over to the police. It took 3-4 personal visits to the police station and about six months before the chain was finally given to her.

Incidentally, she discovered that the police had claimed credit for nabbing the chain snatcher and had even been awarded by Mumbai's police commissioner.

You must be wondering why am I narrating this incident in a column devoted to personal finance?

I will connect up as to why the archaic and inefficient judicial or police system results in situations in the personal finance arena as well, that would be comic if they were not so tragic.

A friend bought the case of Ravi Kant to my notice. Ravi's car was stolen from his house and he filed an FIR with the police and then made a claim with the insurance company for the loss. Only then he realised he would have to produce a "non-traceable" certificate to the insurer.

A non-traceable certificate is a certified note issued by the police department when a complainant files an FIR in a case of theft and the police is not able to trace the lost product or vehicle even after three months' time. The insurance claim is payable only after the "non- traceable" certificate is submitted.

In Ravi's case the vehicle was (un)fortunately traced. It had been used for a crime and then abandoned in a faraway city. He had to take a few days leave and visit the police station where the recovered vehicle was kept to give evidence. Ravi had to make a couple of rounds to the police station and then told that his car was "evidence" in the case against the miscreants. He informed the insurance company to send a surveyor to inspect the vehicle but he found that the vehicle was in a proper condition. The vehicle has been gathering dust in the police station compound for quite a few months even as I am writing this article.

Of course, the insurance company is not paying him any claim and he has had to take a car loan to buy a new car. Now, Ravi is cursing his "luck" that the police actually found his stolen car. If they had not found it, he would have received the claim by the insurance company and would not have to go through so many hassles. Now, he will get back the car after it has depreciated substantially.

Clearly, a criminal judicial system that requires stolen items to be kept as "evidence'" till the case reaches a certain level must change or we will continue to have law abiding citizens wishing that the police are not able to trace their stolen car!

The author is the CEO of Apnapaisa, an online marketplace for loans & investments. The views expressed are his own