Economy

Warren Buffet once said: “Risk comes from not knowing what you are doing.”

George Molakal and Boris G. Tsimerinov are two global investment experts who share the same philosophy. These fine gentlemen are Harvard Business School alumni, expert private equity investors and venture capitalists, and are proficient at managing multimillion dollar cross-continental investments. Molakal is the CEO of Alcor Fund and Tsimerinov is the CEO & Managing Director of Semper8 Capital.


As they are set to expand their investment in India, they have taken great effort to evaluate their existing experience in India and other lower-middle income economies, conduct research and proactively engage with some of the country’s leaders to better understand the current investment climate, opportunities and risks.

Molakal and Tsimerinov recently spoke in New Delhi at the 3,000+ person Global Partnership Summit among other esteemed business people, politicians and scientists from India, Japan, Africa, the Middle East and the United States.

It was evident that Molakal and Tsimerinov were keenly engaged in sharing their wisdom, but also learning from a dynamic gathering of thought leaders and decision-makers. Tsimerinov said: “Keynotes and panels bring lots of information, but behind the scenes discussions at conferences create most value through relationship building, initiating deals and sharing private insights”. Molakal said: “Business is ultimately about choosing the right people as partners, collaborators or employees, inspiring and enabling them to perform.” Both agreed that doing business in India requires lots of local knowledge.

Choosing India as an investment destination, it was clear they had analyzed various macro-economic factors and contrasted the same with other emerging economies. As part of his keynote, Molakal comfortably sighted the Indian pollution statistics and their impact. Tsimerinov was able to easily compare Indian urbanization and demographics data with other jurisdictions in his comments on panels at the Summit. Both were specific and precise in their responses to audience questions.

Tsimerinov and Molakal strongly believe that India, growing GDP at upwards of 6.5% annually, as one of the fastest growing economies can be a good location for investment. Molakal mentioned that India offers cheap skilled labor coupled with relatively low land and capital costs. Tsimerinov sighted the opportunity and need to tackle recognized infrastructure, environmental and societal challenges. The investors were excited about Prime Minister Narendra Modi’s, Minister Nitin Gadkari’s and NITI Aayog CEO Amitabh Kant’s recent comments on pending reduction in emissions, build-up of infrastructure and India moving to electric vehicles by 2030. “It always helps a new investment thesis when the industry trends and government policy are in favour of a target sector” they mentioned.

In speaking about opportunities, Molakal and Tsimerinov also recognized that lower-middle income countries often present unique challenges and risks to international investors. They talked about, generally, higher levels of corruption, frequency of changes in government policy and productivity of labour as some of the issues they’ve experienced in such countries in the past. While they did not point to these as the sources of risk in India, it was clear that their excitement about any market is always mixed with a healthy dose of analytical skepticism.

We learnt that Molakal and Tsimerinov have international interests in a wide range of industries ranging from manufacturing, engineering services and investment banking to healthcare, technology and education. In India, they are open to evaluating sizable opportunities in those same sectors, and more particularly, their sights are set on the emerging ecosystem surrounding renewable energy generation, smart cities and electric vehicles. We were inspired by the investors’ passion for opportunities, thoughtful pursuit of knowledge to understand risks and desire to help solve India’s environmental challenges with their investments. We wish them luck!

“It is best to work among the youth in whom lies our hope — patiently, steadily, and without noise”. – Swami Vivekananda

Every year August 12 is observed as International Youth Day. It is the day for addressing and creating awareness about the issues faced by youth worldwide. It is designated by United Nations focusing on 15 priority areas with some being Education and Employment, Youth and Conflict, Health, Drug Abuse, Juvenile delinquency. The theme for this year  is Youth Building Peace which aims to recognize the contributions of  youth to prevent and transform conflicts , support inclusion, social justice and maintain peace.

 

As part of youth development in India , State Bank of India has initiated a fellowship programme called SBI Youth of  India, in partnership with NGOs. In this, young people work with rural communities in areas like skill development, sanitation, education and e-governance across 9 states of the country presently.

 

There are 1.8 billion young people in the world  between the ages 15-29, according to the UN Report. And India becomes the country which has the world’s largest youth population with nearly 345 million young people that accounts 28% of the country’s population. Though having large youth population gives potential for economic and social progress, India still remains in the critical phase. This is proved  by India’s rank in Global Youth Development Index 2016 complied by Commonwealth Secretariat.

 

India  ranked 133rd  among 183 participating countries with neighboring countries SriLanka(31), Bhutan(69), Nepal(77). The report  highlights that youth development falls behind mainly in education, employment and health. Looking at the stats, unemployment rate stands at 5%. And 13.2% people belonging to the age group 18-29 did not manage to find jobs in 2015-2016 according  to the survey conducted by Labour Bureau. When it comes to health, more than 60% women between age groups 15-49 are anemic. Assam ranks the lowest in the Health Outcome Index. And Overall youth literacy rate stands at 89.95% between 15-24 age group.

 

India spends very less on youth development compared to its size of population.According to the RBI, expenditure on Education and Health  remains at 2.9 and  1.4 as a proportion of country’s GDP in 2016-2017 which is same as last year. In fact, there is no significant improvement on expenditure on both from fiscal years  2009-2010. All these reiterates the need to increase public spending on youth developmental issues to reap demographic dividend.

 

People tend to go for Education in conventional domains , example Engineering. When students in large number go for Engineering , they end up jobless or forced to settle with  IT jobs. This is due to the reason that India is more into service sector and no relevant jobs available in existing industries.Awareness about wide career courses and opportunities available should be created among Indian Youths. And government should  focus on job creation. These are also the reasons why we can find Indians migrating to foreign nations for Employment. It is known that those nations which employ Indians praise their potential and skills. What would happen if half of these population work and become entrepreneurs in India creating jobs rather waiting for government to do its part? Although this is gaining momentum in recent times, it still is not enough compared to having world’s largest youth population.

 

Social and Ethical Values are to be inculcated among the young people for they are the future of India. The sense of social responsibility is slowly but steadily creeping in the minds of Indian youth.They can be the tides of change, they can work towards eliminating crimes and social injustice and maintain peace.

 

Power of Youth is indubitable. They can achieve anything and everything they want. Protest in favour of  Jallikattu in TamilNadu  is simple example of what youth can do.If they are properly guided and provided with adequate resources and opportunities, they can contribute to the Economic Growth and can as well help realize the Vision of  Developed India.

Did you meet any transgender on your way today? Did any transgender come to your place to bless your new born baby? Answer honestly how do you feel when you come across such a person? No, no you don’t have to answer me, just ask yourself, why do you even feel like that? Believe it or not, in contemporary world, transgenders in the society are subject to a large amount of humiliation and distress.They are considered as an object of ridicule, and any sort of contact with them is seen as unwelcoming.The majority of the society doesn’t really understand the general concept of transgender.Basically, one of the biggest reasons for the inequality that they face is due to the lack of understanding of what transgender truly means.

Transgenders have always been very much a part of Indian society since ancient times. Ancient epics like the “Mahabaratha”, which were written a few thousand years ago, reveal transgenders playing prominent roles in politics and directing their outcomes. Transgenders are currently stereotyped as people to be feared, as it is believed that the curse of a transgender person always comes true.According to the government, they were not even entitled to basic rights such as the voting rights, ration cards,passport,etc. And when it comes to earning their bread,they beg on the streets at traffic signals. Yet, today,they are all but ostracized by society, and are invariably forced to resort to begging and prostitution in order to survive.

India should step forward to provide work opportunities for transgenders who live by begging for money from passers-by on roads and trains. The transgenders now have the right to avail any facility and are eligible for reservation after the Supreme Court of India recognized them as OBC (Other backward caste) – that sounds a lot more shocking than it actually is, because it now means they will enjoy the benefits of quotas to get into colleges and in getting government jobs. Our nation should introduce transgender social welfare schemes and some actions need to be taken on a long-term basis to change the negative attitude of the general public and increase the knowledge about them and their communities. The required changes need to be reflected in policies and laws; attitude of the government, general public and health care providers; and health care systems and practice. The advancement of LGBT rights in India depends extensively on individuals and the community coming together and then creating the change themselves. Following are the few actions did for the transgenders in India:
India witnessed its first open transgender wedding, and it received a whole lot of love online.

Indian cinema cast its first transexual woman as the leading actress, Anjali Ameer.

Kochi Metro recruited 23 members of the transgender community, because, why not?

Transgenders are also human beings and they should be treated like all other people. We should not neglect them. We should help them to live a happy life.

The sixth Ministerial Conference of Heart of Asia was held in Amritsar last December. The key elements of the conference was to challenge terrorism in the heart of Asian region, especially Afghanistan. The elements included countering extremism, exploring cultural and civilisation similarities, cooperation in the educational sector and providing connectivity to Afghanistan for its development

An aircraft packed with 60 tonnes of Afghan plants with medicinal uses marked the opening of the first air cargo corridor between Afghanistan and India today. External Affairs Minister Sushma Swaraj has received the plane. The cargo, worth about $11 million dollars, was the first in what officials from the two countries hope will be many flights allowing Afghan and Indian companies to bypass Pakistan, which strictly limits the shipment of goods by land between India and Afghanistan often as part of border disputes.
Afghanistan depends on the Pakistani port of Karachi for its foreign trade. It is allowed to send a limited amount of goods overland through Pakistan into India, but imports from India are not allowed along this route.

The new air corridor aims to boost trade between India and Afghanistan from $ 350 million to $ 1 billion in three years. While it bypasses Pakistan, necessary overflight permissions have been taken, though it allows the possibility of Islamabad acting as a spoiler if it wants.

Ashraf Ghani inaugurated the air corridor between India and Afghanistan.

Next week, the second flight to India is scheduled to depart from the southern city of Kandahar, carrying 40 tonnes of dried fruit.

Afghan President Ashraf Ghani first proposed the air corridor in September last year in a meeting with Prime Minister Narendra Modi; details were worked out when both attended a regional summit in Amritsar in December.

The first flight in this corridor from Delhi to Kabul yesterday exported 100 tonnes of Indian goods. There will be five flights every week from Kabul and Kandahar to India.

The cargo service aims to improve landlocked Afghanistan’s links to markets abroad and boost the growth prospects of its agricultural and carpet industries while it battles a deadly Taliban insurgency, Indian officials have said.

“We will continue to assist you in various ways as this corridor expands and grows into a network of cargo flights as per the demand of the market,” India’s ambassador to Afghanistan, Manpreet Vohra, told President Ghani.

India is a land of exotic diversity – from its culture to its topography. In every corner of the country, one witnesses a different type of weather and land form, a different race of people and a variety of cultures, languages, religious beliefs and eating habits. As the 1.3 billion people of the seventh-largest country in the world take pride in saying, there is unity in our diversity. One similarity that runs through the different cultures and races of every part of India is the economic inequality among its people. The richest 1% own 58% of the nation’s total wealth, leaving behind 23% of the Indian population impoverished. If this was not problem enough, the rich and powerful exploit the poor in every way possible and the poor in India face all kinds of hardships on a daily basis- from food insecurity and lack of healthcare, to illiteracy, unemployment and a total lack of general facilities. Despite the technological and economic development taking place in urban areas of India, the condition of the poor continues to deteriorate.


Over the years 2011 to 2015, Indian NGOs received $7 billion worth of foreign funding.

With these provisions being made, we see no improvement in the developing state of the Indian population. So, the question that arises is:  where does the funding really go? What are the NGOs really up to?

In 2015, the Indian Ministry of Home Affairs cancelled the licences of 10,000 NGOs. Why?

The reasons were:

  • “Not filling returns
  • Misutilisation of funds
  • Accepting funds for prohibited activities, which include funding legal costs of bail
  • Writ petitions of NGOs in India and their activists
  • Undisclosed payment of salaries by foreign NGOs to foreign activists”

This is what those 10,000 NGOs had been up to. But these were just the reported cases. Like the 95% of unreported rape cases in India, NGO fraudulence also goes majorly unreported.

A submission of few documents and not more than ₹3000 is al it takes for an NGO registration in India. Once registered, NGOs are licensed to acquire foreign funding by submitting their development model. With the process being so easy, there’s an NGO sprouting up in every nook and cranny of the country. These NGOs, though, aren’t open with the sole aim of service to the society and/or its upliftment, they have some hidden aims too. The not-for-profit organizations take illegal profit shares from the funds provided to them for human welfare. With the funds which are to be used to provide basic nutrition and clean drinking water for underprivileged people, corrupt NGO heads and members fulfill their own profligacy.

A country cannot grow with efforts made by one person alone, it can only grow with efforts made by all, in the right direction and with the same motive. Here comes a crucial aspect which should be considered, What is the role of NGOs? NGOs are meant for filling the gaps between government and citizens. Indian Government, even after 67 years of independence, has not been able to reach ground level reality; the facts above justify it. NGOs came into existence so that more underprivileged people could be reached out. So, the role of NGOs was to help the government in taking remedial measures, but NGO establishment has now become a business. In this business, donation and funding is taken from different sources and instead of putting it to humanitarian causes, the people running NGOs pocket it for their benefits.

The un-secular nature of the NGO was discussed in a report from 2014, titled, “Hindu nationalism in the United States: A Report on Non-Profit Groups”.

A number of Indian NGOs had been officially blacklisted and their licenses had been cancelled, cutting off their foreign funding.

In the 2015-16 fiscal, Christian NGOs Ayana Charitable Trust, Believers Church India and World Vision India received the highest foreign funding. Ayana Charitable Trust, based in Kerala, is reportedly just the name under which the Texas-based NGO, Gospel for Asia, funds projects in India. The NGO, headed by the Keralite K.P. Yohannan, has two lawsuits of racketeering and fraud filed against it by former Arkansas donors. Gospel for Asia is also a prominent donor to Believers Church, whose temporal and spiritual head is K.P. Yohannan himself, and which owns billions of dollars in assets and claims over 2 million members. Most ventures in Yohannan’s religious empire are for profit. Param Shakthi Peeth, an NGO run by Sadhvi Rithambara, a Hindu political activist and a member of Vishwa Hindu Parishad and RSS, was the second-highest recipient of foreign funding in 2015-16.

Despite the allegations, devotees keep on donating to these organisations. As some of the NGOs are run by religious institutions, people believe that they’d be genuinely working for the greater good. When religion comes into the picture, people turn a blind eye to what may as well be full-fledged corruption and injustice. Because of this, the corruption does not stop, it continues and exploits the resources for the poor in its wake.

There are NGOs which genuinely work, or aim to work, for the betterment of society. But because of the frequent fraudulence in the NGO world, their work is doubted as well.

With licenses and funding being continually issued to reportedly corrupt organisations, development or positive change cannot be expected to be witnessed. The underprivileged will be left to face the brunt of it, like they always have, despite so much money being put towards their upliftment.

The Reserve Bank of India (RBI) announced on Tuesday that it has issued Rs 500 denomination notes with inset letter ‘A’. However, the old notes, which were introduced after Prime Minister Narendra Modi’s demonetisation drive in November 2016 will continue to remain the legal tender.

The central bank, in a statement, said that this was in continuation of the issue of Rs 500 denomination banknotes in Mahatma Gandhi (new) series, which were notified on November 8, 2016. From time to time, the bank introduces new series of legal tender.

This comes after RBI Deputy Governor N S Vishwanathan said in March that the central bank did not have any plan to introduce new denomination currencies as it wanted to encourage cashless transactions in the country, according to IANS.

Notable features on the new currency note:

  • Reserve Bank of India said the design of the new Rs. 500 notes are similar in all respects to those belonging to the current Mahatma Gandhi (New) Series.
  • In the existing series of Rs. 500 banknotes, first notified on November 8 when the government in a surprise move announced demonetization of Rs. 500 and Rs. 1,000 notes, the inset letter “E” can be seen in the two number panels at the upper-left and lower-right corners of the front side.
  • Rs. 500 notes also feature “intaglio printing of Mahatma Gandhi portrait, Ashoka Pillar emblem, bleed lines, the circle with Rs. 500 in the right” and an identification mark.
  • Rs. 500 notes also bear the signature of RBI Governor Urjit Patel on the front side.
  • The year of printing and the Swachh Bharat logo is printed on the reverse side. The Rs. 500 banknotes also contain an image of Red Fort on the reverse side.

How would you feel when you are paid for doing nothing, that too free? Would you like to work on that extra Sunday? May be, not!

Universal Basic Income (UBI) is a social guarantee that is given by the government or any social institution to every individual irrespective of their status, work, education etc, It is a form of social security to all the citizens or residents of the country. It will be given to every individual as an unconditional income. This income will help them to satisfy their basic needs.

Why Universal Basic Income?

It cuts off the inequality between the rich and the poor. This scheme helps to reduce the poverty status in our country. Most of the rural Indians aren’t able to satisfy their basic needs with the earned income, so, when they have the surety of getting fixed pre-determined income source, they will start spending on something more “luxurious”.

Women can act independently in a scoiety with UBI. Independency in terms of financial and pscyological. This income will help every woman to identify themselves in the society.

This will also work as a financial support to the social entrepreneurs who are dependent on funds or loans. This can make them stand on their own, without risking their lives on funds and loans.

Crimes like robbery, thefts, etc happen just because people don’t have enough money to satisfy their daily needs. When they receive this basic income assurance, cases of robbery and thefts will be reduced. By the use of this scheme, the term unemployment can be abolished.

A pilot survey was held in Madhya Pradesh, West Delhi and Maharashtra to check how this scheme works, result showed that people did work hard to promote their economic status.

These “goodies” of the scheme might justify its implementation in a country, but remember India is a home to 1.2 billion democractic people. Can anyone give surety that this state will remain throughout? A big question! So, Why say no to UBI?

So to enable this scheme in India, the government must withdraw all the other income sources granted to citizens as free allowance like subsidies and pensions etc. This is because this scheme will be a costly affair in India. So, feasibility of this scheme in India can be questioned.

Then, comes to the pscyological reason, why would you want to work, when you are paid for doing nothing? It may make people lethargic, especially in the rural India, where people live to satisfy their basic needs.

Do you feel that this money will reach the person correctly? No assurance! No one can guarantee this because of the corrupted political system in our country. Only half the amount of basic income will be received by the person, the remaining will not. So what is the use of allotting an allowance to those who are not in need?

Moreover, our country is hugely populated. It is not like any foreign country with less population where they can provide a basic income to their people. Even if we manage this situation another problem arises – there will be an increase in burden on government for payment and in turn, prices of petrol, diesel, groceries etc.will increase, which will be taken from our income. Doesn’t it sound like giving our income to ourselves in the name of free allowance or basic income?

Universal basic income is essential to our country to eradicate the poverty. It is good if the incomes  reaches the needy correctly without any corruption. Even if people get the income they must not stop themselves from working. Everyone must make use of this money only to promote themselves but not to hinder their growth. If we try to elevate ourselves with the use of this money, surely no one can stop the elevation of our country.

It is a rather astonishing fact that a country like India, which is still battling with many life-threatening diseases and an impaired health care system, has allocated only 2.5% of the GDP to public health sector in the National Health Policy (NHP), 2017. India’s health sector contribution continues to be in the bracket of lowest relative public expenditure on healthcare. Although the policy guarantees health care services to all the citizens especially the backward sectors of the society, it does not guarantee ‘health’ as a fundamental right for the people.

There have been some phenomenal changes on major health issues in India over the years but not enough to overthrow it from having the distinction of largest number of infant deaths, maternal deaths and cases of tuberculosis in the world. The public health systems lack the infrastructure required for sustainment of a good public health system. Above 15,000 positions for doctors at the grass-root level are lying vacant in addition to dearth of obstetrician in 4,000 out of 5,000 community centres. On the contrary, where public hospitals cannot suffice primary health care requirements, the private hospitals are scuttling ahead and are being recognised for being one of the best in the world for the special and super special treatments.

The BRICS counterparts of India spend way more, ranging from 3.5% to 8.5%, on their health care sector. It looks more intimidating when the increase in the total population is taken into account. This expenditure on public healthcare is an investment on the human resource of the country which would contribute in multitude if it stays healthy. According to the Economic Survey of 2015-16, government expenditure on health was 1.3% of the GDP and as per World Health Statistics, 2015, India per capita government expenditure on health in 2012 was $60 as compared to the whopping expenditure of $4,153 by the US. Interestingly, India accounts for 21% of the world’s burden of disease.

The budget aims to open government run pharmacies to provide underprivileged people with cheaper drugs but the number of these pharmacies is practically too low to make a wide network over the nation as compared to 8,50,000 privately-run pharmacies. An alternative to this can be provision of these cheaper drugs at the public hospitals, clinics and dispensaries to cater to a larger number of ailing population.

It has been estimated that to enrol all the BPL families in the country to the health insurance scheme would cost somewhere around Rs. 2,640 to Rs. 3,350 crores which excludes the annual amount and the additional amount for senior citizens. It is financially impractical according to the current health budget to accommodate this scheme.

Some key reasons of failure of the public health sector can be summarised as follows:

  • Humongous amount of lack in healthcare infrastructure.
  • Manpower is inadequate at primary level itself (including dearth of specialty and super-specialty doctors).
  • Healthcare insurance coverage is poor.
  • Wrongly focussed expenditure.
  • Improper prioritisation of key problem areas.

The Union budget of 2017-18 shows an increase of 23% in the allocation for healthcare as compared to the previous year but these figures are deceptive as the overall picture tells a different story. Arun Jaitley had imposed an unexpected cut of 13% in the budget allocation on healthcare in 2015-16 which makes this increase look bigger. The health expenditure, in reality, at the 2005-06 prices, reveals only a minimal increase.

The proposed schemes lack good policy framework, direction and implementation keeping in mind the practical intricacies in mind.

So, this sums up the story of Health sector in India!

GST as we know it, is the new reform in the taxation system of India that will merge the existing plethora of indirect taxes into one, throughout the nation. This reform will bring in more uniformity, less confusion, less corruption, more economic growth and more productivity in the long run.

Here’s how:

Currently, there is a large variety of indirect taxes levied by the state and the central government, like Excise duty, Value added tax (VAT), Central service tax, state service tax, central and state tax, Entry tax and Octroi tax (on interstate transportation of goods), etc. Clearly, these lead to rise in prices by the time the goods reach the end consumer because of cascading. If all these taxes are merged, it will be beneficial in the following ways, according to Gautam Chhaochharia, head of India Research of UBS Securities.

  1. Unified market: All the states adopt the same taxation methods allowing seamless production and transportation of goods with greater efficiency.
  2. Lower incentive to evade tax: Since there is no cascading now, the consumer is only paying tax on the value-addition and not on the entire value of the good.
  3. Widening tax base: Tax base is that minimum amount of annual income which is taxable.

Breaking it down:

VAT system was introduced to remove the cascading ‘tax on tax’ that was being imposed by the sales tax. Essentially this: For e.g.: Let’s say a distributor A bought, some good at Rs. 100/- which was the price after 10% tax addition. Now A sells this to B after another 10% tax addition, for Rs. 110/- after which C buys it from B with another 10% tax addition at Rs. 121/-. This means that C is adding the tax value from the previous purchase made by B too. This is called ‘Tax on Tax’ or cascading. This issue was solved by introducing VAT, wherein the govt. gives credit of the tax, paid in the earlier stage, to the consumers at every stage. Which means, when C pays Rs. 11 on tax, he gets back Rs. 10/- from the previous stages by the govt. as the input credit, because Rs. 10/- was already paid earlier. However this had one issue. That is, the different types of taxes were not relatable. For e.g.: The manufacturer adds excise duty and VAT and sales tax, while selling his goods to the distributor on the other hand, the distributor only adds the VAT tax (on the value addition, of course, as the name suggests) while selling it to the wholesaler. Thus, his account of the payment on excise duty is not shown and no credit is given to the distributor on the excise duty against the VAT, since they are two different taxes. This brings GST into picture, where the government is merging all the taxes to avoid these problems and relating all the taxes as one, for the entire nation.

In addition to this, the GST will also make transportation of goods and services across states smoother by the removal of all kinds of middlemen asking for entry taxes, octroi taxes, etc. at the entry of a truck full of goods into a new state. For e.g. If you live in Andhra Pradesh and have ordered goods from Delhi, the goods will then pass through Uttar Pradesh, Madhya Pradesh, Orissa and then Andhra Pradesh, causing the driver to pay the entry taxes for each state and thereby reducing the speed and the rate of transportation while increasing the expenses. This problem will be addressed and solved with GST.

The prices of all products will remain stable for a longer period of time, under GST, lessening the chances of inflation and leading to the growth of Indian Economy in the long run.

People working with invoices will be at greater advantage and earn more profits through GST.

Recent updates on GST bill:

  • After an 8 hour debate in the Lok Sabha, the four GST bills (CGST, SGST, IGST and the compensation bills) were passed on the 29th of March, 2017, where SGST and CGST will be paid on ‘within the state’ sales and purchases and IGST will be paid on interstate sales and purchases.
  • Telangana was the first state to adopt GST reforms, Bihar being the second, followed by other states like Andhra Pradesh, Gujarat, Delhi, Sikkim, Haryana, Goa, Mizoram, Madhya Pradesh, Nagaland, and very recently Orissa joined the states becoming the 16th one to ratify the bill.
  • The GST will come under play from the 1st of July and no businessman will be punished for violating rules for the first nine months, as that according to the government, will be their learning period or the trial period.
  • All eyes of the council today are on Jammu & Kashmir for passing the bill there.
  • The council has broadly approved the GST rates for services at Nil, 5%, 12%, 18%, 28%.

A number of meetings have been arranged, and after a lot of discussions, some of the scheduled rates include:

  1. GST will combine the present entertainment and service tax and make going to movies cheaper with one 28% tax on movie tickets.
  2. Transport services will attract 5% tax under GST while healthcare and education have been exempted.
  3. Transaction fees are likely to become more expensive as the government has put these under the 18% tax bracket. These services were taxed at around 15% till date.
  4. Prices of television, ACs and refrigerators will go up by 4-5%.
  5. Food grains will become cheaper while milk and cereals are being exempted from GST. Sugar and edible oil however, will attract 5% tax.
  6. Service tax will move up from 15% to 18% under GST.
  7. Restaurants with an annual turnover of less than Rs. 50 lakh will attract a 5% tax while non AC food joints will see 12% tax. However luxury hotels will come under the 28% tax bracket.

So here is GST in its entirety!

On 10th April 2017, India had seen a change in its top e-commerce companies. Flipkart had confirmed the merge of eBay India into its services as part of a deal struck by the two companies. It was previously reported that the merger was part of a $1.4 billion funded by Tencent, Microsoft, and eBay. This had been confirmed by Flipkart in a press meet
It is claimed that eBay India has invested $500 million in being a part of Flipkart. This merger will see the two e-commerce giants coming together and addressing Amazon’s threat in India.
Flipkart founded in 2007 appears visibly optimistic about this new deal. Though Flipkart owns eBay now, Flipkart spokeswoman said that eBay.in will continue to operate as a “separate business” within the Flipkart group, which includes fashion portals Myntra and Jabong. According to former eBay executives, the investment and merger with Flipkart will help bring eBay back into the e-commerce game with a heavier arsenal of offerings.
E-commerce is basically all about buying and selling of information, products, and services via computer networks or internet. The Internet and electronic commerce technologies are transforming the entire economy; and changing business models, revenue streams, customer bases, and supply chains in India and all around the world.
However, it is said that the merger is unlikely to cause any visible impact on the Indian e-commerce market, except the fund infusion gives Flipkart more firepower in its fight against Amazon.
Amazon, the US-based company, which started operations in India in June 2013, has already invested $2 billion here. In June last year, founder and chief executive Jeff Bezos committed to spending another $3 billion in India, taking total investments in the country to $5 billion. On the other hand, Flipkart has raised around 3.6 billion so far, excluding the current round.

Whereas, the Indian government on March 2016 had allowed 100% foreign direct investment (FDI) in online retail of goods and services under the so-called “marketplace model” through the automatic route, seeking to legitimise existing businesses of e-commerce companies operating in India.

FDI, in non-economic terms, is all about letting foreign companies set up shop in India, either alone or by hooking up with existing Indian companies. India is at an unfair advantage that foreign companies are competing to capture the largest consumer market which is expanding day by day. The fight between Flipkart and Amazon is one such example. From Indian economy’s point of view, this will provide more FDI which is fruitful for the economy growth.

However, there is a long way to go for FDI in India but there is concern among the general population whether FDI will bring employment and prosperity to them. And if yes, then to what extent and at what cost.But we also have to keep in mind that no investors invest for charity. Investment in economics is all about making and maximising profit especially when it is coming from the private sector. And, hence, there is always the possibility of exploitation by foreign companies