Friday, 28 October 2016

After 25 years of liberalisation, need for 'Reforms 2.0'

Twenty five years ago in 1991, India launched iconic economic reforms that were considered a game-changer for the country. Just prior to 1991, India was growing at around 5% annually - emerging from years of mere 3% growth, cynically referred to as Hindu-rate-of-growth. In the late 1980s, the government's profligacy had resulted in large fiscal deficit. International debts were rising as well. However, nobody bothered as the economy was chugging along at a decent pace.

The first Gulf war of 1990-91 changed the status quo. Political scenario had also changed. In June, 1991, the Congress had formed the new government under the leadership of P V Narasimha Rao. At that time, the primary source of foreign inflows for India was money remitted by the Indian workers based in West Asia. The Gulf war pushed up the price of oil and at the same time, foreign exchange inflows sharply declined as workers in the region lost their jobs. The new government found that it had just enough foreign exchange to pay for only 13 days of country's imports.

The combination of large fiscal deficit, widening current account deficit along with depleting foreign exchange reserves was the perfect recipe for a critical crisis. International confidence in India's ability to pay was so low that New Delhi had to transport its gold reserve to London as a collateral for aid from International Monetary Fund (IMF). The event is still embedded in Indian psyche as the most humiliating event in its history. This move, though politically very unpopular, gave some breathing space for the government to embark on serious structural reforms.

Rao appointed Manmohan Singh as fin-ance minister while he kept the portfolio of industry with himself. The government used this window of opportunity to clean up the system which did not actually result in the crisis but required cleaning up urgently. India needed a paradigm shift in its developmental model. The Nehruvian inward-looking socialistic model with restrictions on production and imports was showing its fault lines under the pressure of growing population with surplus unskilled labour.

The most iconic reform announced in the first budget itself was the removal of the notorious licence system. The 'licence-raj' required anyone who wanted to start a new industry or expand production or import inputs had to get a licence from the government to do so. This had increased bureaucratic red-tape and bred corruption.

Jettisoning the 'license-raj' was major part of the reform package. Next, Singh addressed reforms in trade and investments. The peak import duty was reduced from 400 to 150% in 1991 and thereafter reduced slowly to 15% by 2005. Foreign investment was liberalised in stages and imports of technology were freed.

India's foreign exchange was so meagre that it was virtually impossible to take dollars out of the country. The government opened up foreign exchange flows. These were major big-bang reforms since India's independence in 1947. In July 1991, Manmohan Singh ended his famous budget speech with a quote of Victor Hugo, "no power on earth can stop an idea whose time has come".

However, in a democracy, as noisy as India, an idea is not enough without wider political support. Critics were quick to warn that India would suffer a 'lost decade' following the mandate of IMF. Fiscal tightening will kill growth, increase unemployment, opening up of the economy will destroy domestic industry and free movement of foreign exchange will deplete our reserves. However, the government managed to pull this through.

Looking back, it is easy to see that India, instead of suffering a lost decade, turned itself around. Growth soon picked up to 7%, businesses remained competitive and turn-ed multinational, foreign reserves increased. Even though manufacturing sector continued to struggle, easing up on import restrictions and tariffs helped the services sector to take off. Capital-starved economy welcomed the entry of foreign institutional investors. Private banks and airlines emerged. In television, monopoly of the Doordarshan was replaced by several private channels.

Fastest growing

The momentum of these reforms helped India join the club of a few fastest growing major economies after 2005. Reduction of income tax, introduction of VAT, Fiscal Responsibility and Budget Management Act, disinvestment policy, planning of golden quadrilateral, introduction of government schemes like Gram Sadak Yojana and MNREGA (Rural Employment Scheme), Aadhaar and Direct Benefit Transfer are some major reforms implemented since 1991.

In 1991, India was a poor developing country, a member of the G77 group. In 2016, India is the fastest growing major economy and a bright spot in the world. It is now a member of the G20, the most-powerful countries in the world. Its per capita income has shot up from $300 in 1991 to $1,700; share of the population living in poverty has halved; literacy rate has improved by 22% and foreign reserves from $5 billion to $360 bn.

In 1991, India used to meet its financial needs through foreign aids and loans. It is now as much a donor as recipient and meets its financing needs on commercial terms. Foreign direct investment last year was record high at $44.9 bn. Indian consumers now have unlimited choices as against few available in the closed economy of 1991.

However, many chinks in its armour had emerged in recent years. From crony capitalism to corruption, massive leakages in welfare schemes, failing education and health system, rise of unskilled labour - problems were many.

The NDA government has been successful in bringing several incremental reforms since 2014. Urgent reforms in education and skill development are needed to harness demographic dividend. Big bang reforms like the GST, land acquisition and labour laws are still awaited. As we celebrate 25 ye-ars of 1991 reforms, there is a need for next iconic 'Reforms 2.0' for India to take off.


Thursday, 27 October 2016


                           DESIGNING INTERIORS WITH VAASTU

While you are reading this article many people are juggling with the choice of colour applications and placement of interior objects in their homes and workplaces.`Which colour goes where?' `Which is the best place for T.V.?' are the common question asked by people all over the world.

Zones and locations

Vaastu is of immense help in deciding room decor as per zonal locations. For instance, the Earth element is associated with the colour green, and with the eastern zone, that mainly governs social networks and associations.Colour schemes and room functions match. For instance, the kitchen is ideally located in the south-east, and the best colour is red. If it is blue in colour, then this zone will be afflicted, and health and financial problems may arise. Also, if the room location cannot be changed, the wall and floor colours can be.By choosing the suitable colour, the negative effects of an erroneous location can be overcome. There are plenty of Maha Vaastu books and courses that can inform you about which pitfalls to avoid.

Likewise, there are clear ideal zonal placements where utility items, like the washing machine, inverter, the music system, and so on, are best placed. A home can be totally designedplanned, down to its last, Vaastu-friendly detail.Each utility item represents an activity . Vaastu lays down which zone is good for which activity. There are single or multiple locations that have different effects on the user.

Placing utilities

The inverter is helpful in the north-west and will bring in support and help at all times. The television set in the east and east north-east will refresh, entertain and educate the user. The music system in the east north-east will refresh the user. The washing machine and aquarium represent churning, and ought to be in the zone of churning, namely, the east south-east. These will help make the mind peaceful and focused. The computer and work table will bring gains and knowledge in the south-west, west south-west and the west. For the other utility items, find out the best locations. Ask a MahaVaastu expert if you have any doubts about object placements.

The north-east should house the mandir. If there is anything else here, check its suitability, especially since mental clarity is at stake. An important rule is that nothing except the toilet and dustbin, brooms and cleaning materials should be in the south south-west. This is the zone of waste and expenditure. Be careful about this while designing interiors. The cleaning cupboard can be placed here. Also, ensure the southwest, the zone of skills and relationship is decorated in yellowcream or white colours. This is a critical zone in every house, determining good family life, finances and work skills.

Vaastu basics

Vaastu is the science and art of traditional Indian architecture that also deals with ideal placements of rooms, objects, colours and so on. As an interior decorator, your aim is to make the house interiors appealing and attractive to their residents. As a matter of course, the guiding principles of MahaVaastu can help in achieving highly professional results in a short time with maximum efficiency. The basic building blocks of Vaastu are the five elements and the 16 Vaastu zones (cardinal directions and their subdivisions). The ba sic Elements or Panch Tattva are Space, Air, Earth, Water and Fire. North, north-east and north north-east are some of the Vaastu zones: this subdivision scheme applies to all cardinal directions.

Discerning the elements

Each element is directly associated with a particular direction, shape, colour and symbol. These combinations can be in a positive or negative cyclestate, depending on what has been placed with what and where, and give rise to emotions and shape the quality of life. Vastu principles are simple, logical and easy to follow. From this, it follows that in any house, as per Vastu, the function of rooms, the nature of objects, and type of color scheme and shape, decides where these will be most suitable.

You can also look at power and other symbols that can be used to lift the room energy. These are easily available at MahaVaastu. The East zone benefits from a smiling, benevolent sun; the West, from a picture of a temple; the North-East, with a smiling, meditative Buddha; in North you can keep blue or green vase with fresh flowers.Vaastu symbols like, Garuda, Kamadhenu, eagle, lion and the Ashoka Pillar are just a few power symbols that can generate powerful results.Likewise, you can select which symbols will help in which rooms.

To be successful, ingrain the basics of Vaastu. Understand the relationship between the elements and Vaastu zones, and you will have learnt the basics of interior design, decoration and placement. As an interior designer of your home, you possess the ability to change the energy of a residence positively. MahaVaastu has documented over 12,000 cases where each treatment worked.


Wednesday, 26 October 2016


                          MAKE YOUR HOME DECOR RAIN-FRIENDLY


Maintaining your home in the monsoon can often be a task. But guess what? The rainy season is also the perfect time to add some freshness in the form of bright colors to your home. Keep the blues at bay and check out how to make your home monsoon ready.

Step 1:

Begin with buying a large, thick coir doormat and place it near the main door. If you have more than one balcony, then place these outside each of them. Avoid taking your footwear inside your rooms and restrict them to the entrance. This will help in keeping the dampness and dirt at bay.

Step 2:

With the moisture in the air and closed windows, it is important to keep your home odour-free. Invest in some scented candles and remember to light them for a few hours every day. This will help in keeping the house smelling fragrant and refreshing.

Step 3:

What better way to liven your spirits in the monsoon than with flowers. So let's add some floral elements to the decor as well.Take out your floral cushions and add some vases with fresh flowers.

Step 4:

Bring in some yellow into your home this season! It is a beautiful, happy colour and the perfect contrast to the monsoon mood. Add pastel greens and hints of pinks and blues to the room. Avoid accents of just one color as the weather can be dynamic at times cloudy, sun ny or rainy a varied color palette complements the dynamism.

Step 5:

It is mandatory to change your curtains during the monsoon. Get some white sheer curtains as they allow light to make its way helping the home brighten up.

Step 6:

When it comes to the floors, use throws and put away your carpets, especially if the house is compact. Use floor mats that can be machine washed and dried.

Step 7:

Play with cushions and bright accessories in your living room as well as bedroom. Add some color to your dining table with interesting table mats and table covers.

Step 8:

In the bedroom, add vibrant bed linen, and put some fresh flowers on the bedside table. Avoid using dark colors like red and orange in this cloudy weather.

Create some freshness this season, and have a colorful monsoon.


Tuesday, 25 October 2016


                          FLOORING CHOICES FOR A TRENDY HOME


With the number of nuclear families and working couples on the rise, time is the most precious commodity. Most families are opting for homes which require minimal effort to customize living spaces, catering to individual taste but with no compromise on style.

One dominant element in the decor which dictates style is the flooring. Apart from defining aesthetic value, flooring selection must be appropriate to the activity type in a given space. Different spaces in a home have diverse requirements. In kitchen and washrooms, maintenance may be the deciding factor whereas in living, family and entertaining zones, look and feel play the key role.

If your home already has the flooring done, the ambience need not be limited to the preset scheme. There are many easy to lay options on existing flooring with a wide range of finishes.

Hardwood and engineered wood

Hardwood flooring essentially consists of different species of wood, laid either as planks or parquet. Hardwoods give a warm appearance and feel. They complement both classic and contemporary interiors. Solid wood must be nailed to the existing floor. But hardwood flooring is susceptible to warping due to excess moisture and is one of the expensive options.

A more budget friendly option is engineered wood, which has a top veneer of expensive wood backed by layers of cheaper wood. Engineered wood can be nailed or glued on existing floors.

Laminated flooring

Laminate flooring consists of a plywood or medium density fibre board with a decorative plastic laminate. A durable inexpensive option, laminate flooring is a very popular choice due to the wide range of colors and patterns available, even resembling wood and tile finishes. It is stain resistant and easy to install over existing flooring.

Natural stone or tiles

Natural stone offers the flexibility of being cut to required size and shape. Finished stone is moisture resistant and offers variety in laying patterns and groove inlay details. Similar to hardwood, natural stones can be expensive. A good alternate is the use of tiles ceramic, porcelain or terracotta. Natural stone and tiles can be laid on existing flooring using adhesive.

Carpet or vinyl

Typically classified as soft floorings, carpet and vinyl are easy to install as wall to wall coverings on existing floors. Both these options are available as rolls or tiles and come in a variety of styles. Though vinyl is easy to clean, carpets need regular vacuuming and are not stain and spill resistant.

Other select options include trendy materials such as moulded acrylic, glass flooring and metal decking. Eco friendly flooring materials such as bamboo and cork are also gaining in reputation as exciting options.

Irrespective of the choice of flooring, certain precautions need to be taken while selecting and installing flooring in ready to move in homes. While experimenting with different flooring options for different rooms, especially in continuous spaces, level differences due to varied thickness of materials should be considered. Precise jointing is very critical to a sophisticated d├ęcor. The color, pattern and texture of the flooring must complement the overall design theme. With the right choice of flooring, exclusivity and sophistication can be redefined in any home.


Monday, 24 October 2016

Crystals add resplendence

                                        Crystals add resplendence


These bright accessories are perfect for stylish home decor themes

Decorating your home with crystal is fad these days. A simple crystal piece can offset a living space with its stylish demeanor. Today, crystals are one of the most favored decorative accessories for urban home decor. They add to the elegance of your contemporary home interiors and display your refined sense of style. Whether it is adding an artwork of crystal flowers or figurines to the display case in your living room, or placing a chandelier on the ceiling, crystals never fail to make a glamorous style statement.

Crystal pieces and collectibles are suitable for any type of decor. If you have a liking for small pieces of crystals, then opt for a crystal vase on the centre table or an array of crystal tableware and stemware. Crystal is best seen in miniature sculptures and figurines that can enhance a desktop or display cabinet. There is a wide array of bird, animal and flowers of paradise figurines that create the perfect balance of aristocratic class and contemporary chic.

While planning a crystal collection, decide on which areas you would like enhanced like the living room or dining room. Low tables, coffee and side tables can be given an element of luxury with delicate works of crystal like bowls, boxes and vases. If you wish to add warmth and personalize the space, then crystal photo frames showcasing some of your most favorite moments are ideal.

Candleholders and table clocks are other classic pieces for the home. Have variety in your collection. Exquisite crystal flute or cognac glasses are a must to fine dining to impress guests. A crystal fruit bowl and a set of plates and quarter plates would complete the perfect setting. Consider a crystal photo frame to display a moment in companionship or joy.

You have a large number of designs available in most interiors stores in the city. From table decors to desk accessories, crystals find a chic corner in every elegant room. Office or desk accessories like crystal pen holders and paper weights add a classy look to the work space.

Proper display of crystal particularly of miniatures, figurines and smaller items is necessary. A well-lit display cabinet is a must or else all your beautiful pieces will be lost in the crowd. Depending on the size of the collection, wall mounted or standalone cabinets can be used for display.

If there are just few of them, an open wall shelf, niche or a side table will be perfect to showcase them. Since display and lighting go hand in hand, see that your crystal collection gets the best of light.

Usually, there are inbuilt lights in display cases. To highlight a wall shelf or niche, track lighting or spot lights will be excellent. Wall fixtures too can benefit with this kind of usage wherein the crystals will catch the light and add shine to the decor. One can also hang an oversized crystal drop from the centre of the chandelier and watch it transform the place.

Another easy way to add glamour to your home space is with the help of a crystal chandelier. Thanks to the spectrum in designs and styles available today, even a modest home can afford to introduce a small unit that can be an instant eye-catcher


Saturday, 22 October 2016

Grow a herb garden at home

                                       Grow a herb garden at home


Herb gardens can be grown in the smallest of spaces and add more to your menu

It is a myth that these exotic herbs can't be grown in hot climes because the seeds aren't available. Those who stay in small apartments and cannot indulge in gardening due to lack of space, also have reason to rejoice. Floral beds and manicured gardens sure have that come-hither oeuvre and magnetic appeal. Welcome to herb gardens that are garnering a lot of interest these days.


These exotic herbs can easily be grown at home. City entrepreneur Ashok Agarwala, who has a green thumb, reveals, “There are a lot of people who try and create special atmosphere for exotic herbs, but you can grow them easily at home if you give balanced love, care, light and humidity and not over indulge these delicate plants. I grow three varieties of basil, celery, lettuce and many other herbs with regular care given to them and the results are heartening. But yes, you have to shield them from extremities of weather.“


It is a myth that these exotic herbs can't be grown in hot climes because the seeds aren't available. There are a lot of shops where you get the seeds of almost all the herbs. And in certain cases, you can order them online too. Sanjay Lokhande, one of the owners of a nursery, adds, “Seeing the growing demand for kitchen garden plants, we have started selling the saplings of various herbs. And we plan to add more of these herbs to our stock.“


Those who stay in small apartments and cannot indulge in gardening due to lack of space, also have reason to rejoice. Artist Gunjan Khandelwal, who has turned her small terrace into a vibrant garden replete with varieties of fruits and vegetables shares, “I have a specific corner dedicated to herbs and they are the pride of my tiny garden. Right from thyme to green garlic, basil and oregano, everything grows in these tiny spaces. You can also nurture them in pots and bring out the gardener in you.“


There are certain enterprising gardening enthusiasts who believe in the goodness of starting their own herb gardens from the scratch. You can start your own mini herb garden right on your kitchen window sill. You can grow fresh garlic by putting a few pods in a pot and grow mint and coriander without any fuss. Using the fresh ingredients picked while cooking can add that beautiful aroma to any dish. From bay leaves, basil, black pepper, lettuce to lemon grass and more, grow them all. It is such a satisfying moment to see these glorious beauties grow right in front of your eyes.


Friday, 21 October 2016

Saying no to garden pests

                                        Saying no to garden pests


Be it enlisting the help of your pet or utilizing bio manure, controlling pests in your garden has never been this easy

With the monsoons setting in, you must have noticed an inexplicable freshness in the greenery around you. Rains, the harbinger of life, add an element of magic to your garden too - be it a sprawling one, a terrace setup, or even a few pots.

But monsoon is also a season that spells trouble for your green spaces. The high humidity, constant showers and damp weather can take their toll on your precious plants. Apart from these, another major disadvantage of monsoon is the sudden influx of pests. Be it a rat that nibbles on your veggies and spreads diseases or slugs that damage your plants, garden pests can undo all your gardening efforts in a jiffy. But before you decide to reach out for the chemical insecticides and pesticides, here are a few eco-friendly and safe methods to eliminate garden pests.

Prevention is better

Rats, squirrels and some insects make their home in cracks, crevices, discarded pipes and other items. So first, attend to these and close all openings, which could potentially house the pests. As they are shy creatures, it is only when they multiply that we begin to notice them. Snails stick on to the underside of stones and rotting wood. Clear out all debris to send them a clear signal of inhospitality.

Plants need to be pruned as monsoon arrives. This helps them grow better. However, ensure the pruning is carefully done, as pruning them improperly can damage the plant. As the plants receive plenty of rainwater, proper draining of the excess water is essential. This keeps the roots healthy and vibrant. Make sure that there is no stagnation of water around the plants, which attract insects to breed. Delicate plants can be kept indoors or in the veranda to prevent them from rotting.

Encourage visitors

Next, take assistance of some friendly visitors to your garden that naturally feed on the unwanted animals without affecting your plants. A cat in the compound keeps the rats away. Birds visiting the garden feed on bugs and insects. So, having a birdbath or a small birdhouse will not only add an element of attraction to the garden but also help in pest control.

But beware if you happen have fruit trees around. You may want to protect the fruits from birds by covering them appropriately. Earthworms in the soil make it fertile and feed on the moss and fungi. Beetles or ladybirds, grasshoppers and frogs feed on aphids and other insects. So, encourage the presence of these animals to keep the pests under control.

Encash on their dislikes

Plant garlic, onion, mint and dandelions in proximity of the garden. The strong odours of these elements discourage rodents and insects. Some insects run away from peppermint sprays. Sprinkling turmeric prevents ants from raiding the soil and damaging the roots.

Another way is to strengthen the plants naturally and make them pest-resistant is to sprinkle neem powder, onion, garlic, ginger and cardamom peels on the soil. Bio manures like cow dung are very effective and nutrient rich for plants. This not only fortifies the soil but also keeps fungus and insects at bay.

Get rid of them

Some infestations call for extermination. Aphids are white, velvety type of insects that cling onto the plants and destroy them. They can be one of the most difficult plant infestations to get rid of. Use a harsh jet of water to dislodge them. As they hold on to the plant by their mouth, the spray of water dislocates them. You can buy beetles from horticultural suppliers and spread them around to eat the aphids away. Additionally, spray neem oil mixed with vinegar and a little detergent on the plants to ward off the aphids. They hate the bitter mix and will not choose your garden as a home.

To eliminate snails and slugs, beer is found to be quite effective. Placing small containers of beer around the garden attracts them to it. They ingest the intoxicating liquid and usually drown in the container. Weeds grow at an alarming rate in this season and eat up space and nutrients, hampering the growth of the plants. Diligently de-weed the garden as soon as you spot them.

And it's time to see your garden flourish!


Thursday, 20 October 2016

Residential real estate

                                             Residential real estate 


Residential real estate in Bengaluru: 

The real estate market in Bengaluru is gaining ground, thanks to sustained growth in market prices and investors' interests. Being the IT hub of India, Bengaluru has a multi-cultural population with good social infrastructure, excellent educational institutes and constantly upgrading physical infrastructure.

A redeeming feature of this market is that it allows flexible growth in many aspects, right from infrastructure and technology parks to educational institutes.

Box47386 Potential residential micro-markets: Looking at the current prospects, we recommend investing in real estate, which includes land, apartment or villa projects depending on the budget. A good investment in real estate should yield high returns over a long period of time and hence is considered as an asset.

With the recent government initiatives, there is a lot of hope for a buyer, unlike before. Developments like the recently passed Real Estate (Regulation & Development) Bill 2016, Smart Cities initiative, and the introduction of REITs (real estate investment trust) are expected to bring in the much-required transparency into the sector and enhance investors' confidence in the coming years.

Currently, some of the most promising residential micro-markets are located in and around the Outer Ring Road (ORR), Whitefield towards the East and in North Bengaluru locations like Thanisandra and Kogilu. As per the latest Knight Frank Research findings, East Bengaluru saw greater momentum in sales growth during the period January-June 2016 due to preferred budget range, access to employment hubs and metro connectivity. Both East and North Bengaluru have the benefits of good social and physical infrastructure, accessibility to employment hubs, varied price options and project availability.

Meanwhile, an important trend that has been witnessed is the shrinking of sizes of apartments and also formats to studio, one BHK units, two-and-a-half BHK units, thereby bringing down the ticket size of the apartment. Investors and buyers alike, with a lesser budget, can opt for affordable housing projects located in South Bengaluru peripheral regions such as Anekal, Attibele, Chandapura, Kammasandra, Hosa Road and Begur, as well in West Bengaluru peripheral locations like Kumbalgodu, Tumkur Road and Kengeri due to availability of land at relatively cheaper prices.

Hoskote and Mandur in the east and Rajanukunte in the north are also viable options. These locations are good for long-term investments, especially the ones that are abetted by the upcoming metro connectivity.

Not to be overlooked, investing in land is also a good avenue for investment purpose. Micro-markets located in the industrial regions of West Bengaluru like Peenya and Yeshwanthpur have great potential due to support and social infrastructure in place.

This region commands connectivity to railway stations, highways, metro rail and airport as well. Owing to the comparatively lesser land pricing, it holds potential to be an IT hub in the future. Investors can also look at closed down or sick units and factories located in this industrial belt and gated communities as it portends substantial prospect in commanding higher prices in the forthcoming years.


Wednesday, 19 October 2016

Analyse and invest

                                                 Analyse and invest


Anticipating a revival in earnings and demand growth is a dangerous way to plan your equity investments

Investors in the Indian equity markets have been swinging between wild optimism and quiet pessimism since 2012. Many attribute the lacklustre performance of the markets to the lack of fast-paced structural reforms or a deeper cut in interest rates. The real culprit, however, is the lack of earnings growth. Persistent single-digit earnings growth clearly indicates that corporate profits do not back early market optimism. The inordinate delay in cyclical catch-up should concern investors.

The turnaround of a bear market into a bull market is typically led by a fall in interest rates. This provides immediate relief to businesses burdened by borrowings and inventory . Then the operating margins improve, riding on lower input costs and operating leverage, as capacity utilisation increases. Soon, businesses are in a position to post a growth in revenue and expand volume and value of sales, as demand picks up. With sustained demand, businesses become con fident about making further capital investments, and the bull cycle is complete.

The main shocker in the past three years has been the failure of earnings to match up. Estimating earnings is a dangerous game, and in each of the last 12 quarters, analysts have rued that earnings have missed estimates, or the downgrade cycle of earnings has persisted.The single-digit earnings growth that we have seen for Indian equity is unprecedented and unexpected at what seemed to be a turn of the economic cycle.

A chunk of the equity markets is in structural distress. While oil and metals suffer from the downturn in commodity prices, banks are going through the pain of balance sheet restructuring. Infra and capital goods have been hit by lack of investments, and export-led businesses have been impacted by slow global economy . Auto, consumer durables and real estate face lack of demand. The absence of investment is damaging, and the low rate of growth in bank credit implies businesses are not expanding. This structural logjam is holding the markets back.

A very frequently cited explanation about the poor earnings story is that it could be a `one-time extraordinary event'. This term refers to a charge in income that is large and negatively impactful, but not expected to persist. Discussions about balance sheets of banks are rife with such comments. Is the stress in the banking system just an accounting and reporting problem, or is there a serious structural limitation to quality of earnings? It is dangerous to show bravado about a turnaround in earnings, when what is touted as `extraordinary' is only the beginning of a long rework.

There is a lot of optimism about demand revival, with the monsoon being the messiah. This time we also have the Seventh Pay Commission. The idea is that if the rainfall is normal, the purchasing power of rural masses will return. Add to this the purchasing power in the hands of government employees, who will use their higher salaries to buy stuff, and we should see a revival in demand for goods and services. Those looking at sectors such as real estate, consumer durables and automobiles are enthused by this revival. Let's consider one real estate to see how this might be an overly optimistic argument.

The real estate market in India boomed due to the runaway optimism of the early 2000s, and struggled to keep up after the global financial crisis. After a period of bravado, the reality of large unsold stocks has become stark. That's why the sector is at the forefront of lobbying for lower interest rates. However, neither a low interest rate nor a pickup in demand would help. What the sector needs is a steep drop in prices, a correction that vested interest of partly completed projects will not allow, leading to a structural logjam.

Another fallacy is that of valuation. Every time an earnings forecast goes wrong, enthusiasts point to how the markets have become cheaper. They declare that at 16 times forecast earnings, the Indian markets are so much more attractive than in the past. Price-earnings ratios have never been about the price-they are about earnings alone, and that the stubborn denominator should justify the wild gyrations of the numerator. Falling PE multiples in a market that screams turnaround should sound alarm bells about earnings not matching up.

The lack of revival in earnings points to serious structural and qualitative problems in corporate and banking balance sheets, and sector-level and company-level differences in performance. The focus for the equity investor should be on the micro-level selection of busi nesses that show relatively better quality, with sturdy models that have stood the test of time; businesses that have been conservative and consistent; and businesses that are not burdened with debt and are therefore able to capture any revival in demand.

Instead of being blindly optimistic about a revival in earnings and domestic consumption demand taking care of everything, it would be wise to acknowledge that these are times for good old-fashioned hard work around stock selection and hard-nosed fundamental analysis.


Tuesday, 18 October 2016

Claim all deductions while filing returns

                           Claim all deductions while filing returns

Many are busy finalizing and filing their income tax returns.

The last date for filing the returns for the financial year 2015-16 is July 31. You need to ensure you have claimed all deductions available to you under the Income Tax Act

Property owners need to calculate all in comes from houses owned by them. Under the Income Tax Act, in case a person owns a property, he is liable to tax even if no rental income is actually received from it. There is a `deemed income' assumed to accrue from such properties and this income is subject to tax.

During the course of the year, a property owner in curs expenditures on the properties. These include insurance costs, interest on home loan, municipal tax, maintenance charges on different accounts, power water charges, repair’s charges, and collection charges and so on. A common question asked is whether one can claim a deduction against these expenses under the Income Tax Act.

A list of deductions provided under the Income Tax Act is exhaustive. The Act provides a list of expenses that can be claimed as a deduction while computing `Income from House Property'. All other expenditures are not allowed to be claimed as a deduction. The expenses allowed under the IT Act are:


Property owners are required to pay municipal tax on the properties to the civic agency. These are allowed to be deducted while calculating `Income from House Property'. The actual amount of such tax can be claimed as a deduction. This tax can be levied by any local authority on the house property.

To qualify for the deduction, it should be noted that the tax should have been actually paid during the previous year.


This is against the repairs and collection charges. The actual expenditure incurred on repairs and towards maintenance of the property is not allowed. The Income Tax Act allows 30 percent of the Net Annual Value (value arrived at after deducting the municipal tax from the Gross Annual Value) as repairs and maintenance expenditure.

The Gross Annual Value is the highest of rent received or receivable, fair market value or municipal valuation. If, however, the Rent Control Act is applicable, the Gross Annual Value is the standard rent or rent received, whichever is higher. A deduction is allowed on this value even if no money has been spent on repairs.

In case the amount spent is more than this figure, then also the deduction is restricted to 30 percent of the Net Annual Value and the additional amount spent is not allowed to be deducted. Also, in case the cost of repairs is borne by a tenant, this deduction is not allowed to the owner of the property.


This is by far the most significant deduction allowed under the Income Tax Act. You can claim a deduction against the interest paid on the amount borrowed for the purchase, construction, repair or reconstruction of a house. This deduction is allowed even in case of a self-occupied property. In case the property is self-occupied, the deduction is to the extent of Rs 2 lakhs per annum. However, in case the property is rented out, the entire interest paid is allowed as a deduction.

This deduction is allowed on accrual basis. That is, it is allowed even if the interest amount is not actually paid during the year.

The interest paid during the pre-construction or acquisition period will be allowed as a deduction in five successive financial years starting from the financial year in which the construction or acquisition of the property was completed.


Monday, 17 October 2016

Have you planned your capital gains tax?

                                 Have you planned your capital gains tax?


Individuals who have to file their tax returns this month still have time to save on capital gains tax in case a house was sold in the financial year 2015-16, generating gains

The deadline for filing your income tax returns for the financial year 2015-16 is approaching. An individual who has sold a house during the financial year 2015-16 can still save on the capital gains tax livable. Capital gains tax arises in case you sell your property at a price above the cost you acquired it at. The cost is not the actual price paid to acquire the property. Here, it means the indexed cost, arrived at after applying the indexation factor to the cost of the property as well as any improvements made to it by the owner.

The amount of capital gains earned is arrived at by applying the Cost Inflation Index. This Index is published by the Income Tax Department. The present worth of a property is arrived at by applying the Cost Inflation Index to the cost of the property as well as any improvements made to it. This amount is deducted from the consideration amount received by the transferor from the transferee. This gives the capital gains earned.

The portion of capital gains that is not appropriated by an individual towards the purchase of another property should be deposited in a specified bank account. A deduction against this amount can be claimed only in case it is deposited in a `Capital Gains Account Scheme' before the due date for filing of income tax returns. The account can be opened with any nationalized bank. The scheme is called `Capital Gains Account Scheme, 1988'. The scheme is applicable to all who have earned capital gains. The deposit may be made in one lump sum or in installments a any time.

As it normally takes a bank 2-3 days to open this account, you should plan in advance and open the account early rather than wait for the last minute.

Under the scheme there can be two types of accounts:


This account is in the nature of a savings bank account. Withdrawals may be made from the account from time to time subject to other conditions of the scheme. This account is suitable for individuals who are planning to construct a house over a period of time.


This account is in the nature of a term deposit which is payable after a fixed period of time. The interest earned on the deposit may either be withdrawn periodically or reinvested.


In order to open the account, you must fill up the prescribed application form in duplicate. Further, the type of account A or B is to be specified. In case of Deposit Account B, it has to be specified whether the account is to be cumulative or non-cumulative. You need to attach a photograph, ID and address proof along with the application.

It is to be noted that only the amount of capital gains earned in the transaction are to be deposited in a capital gains account and not the complete sale consideration received on sale of a property. The details of capital gains account opened should be disclosed in the income tax returns.


The amount deposited can be used to buy or construct a house. In case the amount deposited is not used entirely or partly for the purchase or construction of a house within the stipulated time, the unused amount will be charged as income of the previous year in which the period of three years from the date of transfer of the house expires.


Saturday, 15 October 2016

Growing orchids at home

                                        Growing orchids at home


Most orchids are easy to grow indoors because they thrive on air

Orchids are a challenge to look after. You need a lot of patience.

And just when you are about to give up, they surprise you with their real beauty -in various shapes, sizes, colours and fragrances. And like most pretty things, they are high-maintenance. However, not all orchids are difficult to grow. Some are practically indestructible. It is estimated that there are more than 1,300 species of orchids found in India, primarily in the Northeast -Assam, Meghalaya and Arunachal Pradesh -and also in Sikkim and south India. Most orchids are perennial herbs with simple leaves and if raised in the right conditions (temperature not less than 1617oC), they should last eight weeks with flowers, after which the blooms slowly start dropping off. They eventually re-flower. A word of caution: Never cut off the aerial roots, and never, ever remove the orchids from the pots they root in.


Growing orchids can be addictive. Most orchids you get in nurseries are hybrids, created specifically for flowers. They are easy to care for at homes and offices. However, a few things should be kept in mind, like light and humidity. If you can imitate a plant's natural habitat, it will thrive.


The most commonly available orchids, such as the Moth Orchid, Phalaenopsis and Cattleya are so popular because they grow well at home. Phalaenopsis hybrids are usually considered the `beginners' orchids', largely because they rebloom under the conditions most windowsill growers can offer them. They require lower light. African violets can adapt to different humidity levels. They, however, easily die off due to over-watering. Under watering can be a problem too. In Vedic scriptures, there is mention of a plant named Vanda, which has been adapted as a generic name for one of the most beautiful group of orchids. Vandas could be mostly found on trees. And unlike most plants, they do not grow in soil, but air. Their roots attach to trees or rocks, and they draw moisture and nutrients that wash over them in the forest. Beginners often make the mistake of assuming that orchids need to be potted in soil like other blooming flowers. That would be a grave mistake. Most orchid roots need far more air than potting soil would give them. So, look for a porous mix.


Direct sunlight should be avoided. Some common types of orchids that thrive on bright light are Cattleya and Vanda, while low light is preferred by Phalaenopsis and Pahiopedilum, among others. Orchids should be given as much light as they can tolerate. Varieties with thicker and erect leaves can tolerate more light than those with thinner or more horizontal leaves. Too little light is one of the common mistakes beginners make.


Warm-growing orchids like day temperatures between 21oC and 29oC. This includes Phalaenopsis orchids. The commonly available orchids that are sold in nurseries do well in temperatures that are comfortable for human beings.


Most orchids like about 70 per cent humidity in the atmosphere, which is more humid than most homes. So, you have to make an effort to provide your plants with extra humidity. Orchids usually appreciate misting with a spray bottle. If the plant has aerial roots growing up and out of the pot, those roots will like getting some moisture. At home, you can keep the planter on a tray. Fill it with water and gravel. As the water evaporates, it will provide some extra humidity to the plant. For anyone keeping tropical plants on a windowsill, this technique really helps.


Orchids need nitrogen, sulphur, phosphorus, potassium, calcium and magnesium for growth.


Overwatering kills far more orchids than under watering. When in doubt, just don't water. The potting mix also has a lot to do with how often an orchid needs watering. Most orchids are sold in mixes that allow for weekly watering. Don't water until the soil is approaching dryness. To water an orchid, just submerge the pot in a bucket for a few seconds, then lift it out and let the excess water drain off.


Beginners often wonder how to prune orchids.

Trimming old flower stems that have turned brown is a good idea. If it's still green, it may re-bloom, either from the tip or by branching further back on the stem. Trimming orchids should only be done to remove leaves, roots, or flower stems that have already died or have turned brown. You must sterilize your cutting tools or use disposable ones so that you don't spread diseases between plants. The best time to re-pot is when new roots start to grow. So, what are you waiting for? Get started.


Friday, 14 October 2016

For a new look in an old home

                                        For a new look in an old home


For many, renovation generally means pulling down the walls in the home and recreating some elements from scratch. And when contractors don't space their work or workers properly, it turns into a chaos. Projects take a lot more time to complete and there's no sense of economics in the costs involved. To help you bring some order to the process, here are some suggestions on how to renovate some of the spaces in your home, along with information on sourcing the materials.

Sturdy kitchens

Kitchens of the '60s had concrete counters and a large funnel-shaped chimney just above the stove. The easiest thing would be to remove everything and have a clear space for cabinets and cupboards fitted with standard-size trays or baskets and topped with a 20mm-granite counter.

If granite counters and sinks were |installed at some point of time, it is worthwhile retaining them since the 40mm granite used before the time of modular kitchens do not crack easily. Besides, unlike doors or windows, used granite has very little or no resale value.

40mm granite slabs necessarily need a supporting wall. This may decrease the available space below the counter by a few inches requiring customized fabrication of baskets and trays.

If the granite sink is being replaced with a stainless steel one in the kitchen, consider moving the former to the utility area.

Dazzling bathrooms

Decades ago, when bathrooms were fitted with a big brass vessel housed in a brick fireplace to heat water, lofts were made to store firewood. With the availability of geysers, the entire fireplace and the loft above it can be demolished. Instead a loft can be made in the bedrooms for extra storage space.

Consider using granite corner-wedges or shelves in the bathroom instead of more expensive plastic or chrome fittings. A good tile-layer should be able to incorporate these when installing the wall tiles.

Beautiful bedrooms

Concrete lofts can be made at a height of two feet from the ceiling. Alternatively, fabricated metal lofts can also be installed at the same height. Installation should be done before the floor tiles are laid to prevent any iron dust from landing on the same.

It is also a good time to fabricate additional storage lofts or shelves in the utility or garage areas.

Doors & windows

Many old houses had square window boxes (especially in the front) with the grill embedded onto the outside of the same. If the sides or bottom of the boxes have been removed, new grills will have to be fabricated for the windows. Then again, if the primary aim of the renovation is to allow more light, window grill(s) will have to be installed.

Get the window grills made on a rectangular metal frame, which can be fitted on to the existing wooden frames. Unlike the window frames of today, older frames used to be embedded a good six inches into the walls and it is not advisable to remove them.

When ordering new window grills, make sure that they match the existing ones in pattern.

Ensure that all the fabricated metals have been coated with rust-proof paint before being fixed on the frames.

Hues of a home

Painters normally ask for a house to be handed to them once all the other workers are done. No one wants cement dust or fingerprints on a newly painted surface.

Choose neutral, light colours if natural light is poor and to give the impression of a larger space.

Installation of windows should be completed so that they can be closed at the end of the day. Ambient dust can spoil the freshly painted surface.

Ensure the electrical connections are completed and are working satisfactorily. Painters will insist on having bright light (preferably tubelights) from more than one angle to detect undulations on the wall.

A good painter will spend considerable time taping newspaper on the edge of the tile-lines in the bathrooms, kitchen and utility areas. Fans should be covered and decorative light fixtures removed. The edge of the modular switch plates should be protected using masking tape.

Ensure the floor and skirting is free of paint spots after the job is done.

The source

Renovation done with a contract for both labour and material becomes an expensive proposition. A little homework on the cost of materials cost and sourcing them on your own goes a long way on trimming the budget.

Masonry: Cement and gravel (jelly stones) have a fairly standard cost. However, sand being expensive and varying in cost, it is worth the effort of sourcing it directly from the lorry owners. Seek out the nearest bulk supplier of sand and bargain heavily for the required amount. Ask the contractor or mason for the grey-coloured industrial sand (which is easily available).

Electrical connections: Seek out the wholesale dealer or distributor for the brand that you have decided on for elements like electrical switches, wire, exhaust fans, fans etc, as these are going to be in your home for at least the next 20 years or so. Wholesalers generally offer massive discounts.

Sanitary connections: Decide on the washbasin, commode, taps, geysers and other fixtures for the bathroom and kitchen sink, since most plumbers ask for the same in order to mark the correct positions of the taps and drain.

Framing right: Wooden doors and windows are an option if both the wood and the carpenter are seasoned and good. Otherwise consider installing fibre reinforced plastic or glass reinforced plastic (FRP/GRP) doors and frames, which are not affected by humidity and heat.

Flooring & tiling: Source the flooring and tiling material from a dealer who is not too far away. Should the need for more material arise at short notice (and workers always inform you at the last minute), it can be procured easily.

Fruitful labour

Once the renovation plan is finalised and the material to be used is decided upon, the right labour needs to be identified in order to execute the plan. The basic requirement of the renovation will need removal and building of walls, plastering of the grooves made by the electrician or plumber for installation of new switches/pipes and laying of new floors (not the tiling). So, a contractor who is a good mason and has a good plumber and electrician will do for a start.

For all the other jobs, labour can be sourced from different places. For instance, outlets that sell tiles will provide you tile- layers who will charge the market price and will not have to pay a commission to the contractor. Similarly, reliable painters and fabricators can be hired independent of the contractor.

For jobs like painting and fabrication, always get at least three to four quotes from different dealers and then take the final call. Most people have a problem of unfinished renovation when an advance is paid. It is best to pay in small installments up to the half-way mark collating the amount of work properly finished. The remaining 50% payment should be made after the entire body of work is completed. For instance, make sure that the tiling contractor finishes grouting both the floor tiles and the wall tiles completely before making the final payment.

So, go on, give your home that much-needed change. There's no reason to be intimidated by it.