There was a time when equity investments were almost unknown to the common, small, investors.

Mutual funds were not there and the only investment avenue available was Bank FD, NSS and PPF.
Since then we have seen evolution of the financial markets and emergence of other avenues of investment.Unit trust made it's appearance in 1964 perhaps in a small way with Unit-64 scheme. I don't recall when exactly , National Savings Certificate made it as an offering eligible for tax exemption under 80CC or some such IT section. Those days, early 1970's, there was a differential in the interest rates on various savings instrument available with the rate on the tax-exempt instruments being a little lower than the others. By 1-2% or so. Fair enough,that was.

That we thought was logical due to govt efforts to avail of cheaper funds from public to supplement funds available for public investment. It, perhaps, made sense those days for the Govt to offer tax incentive to get people to go for investment in the LIC products. To provide a leg up to the Life insurance as a product for risk cover at least. The returns those days from the insurance offerings from the only Life insurance company, LIC was as poor as it has always been. But the inherent assumption, now proved wrong & infructuous, that putting money in LIC was ALSO an investment avenue was sought to be inculcated in the public psyche. Through the tax exemption that went with it. {It should now be withdrawan, without further ado.}.

Still the only reason for most of us availing, reluctantly, for the LIC offerings was only the tax savings accruing therefrom. That may have changed over a period of time as people have come to believe, over a period of time, that even LIC products can be a viable investment avenue for the private savings. THE PURPOSE, OBJECTIVE of this post is to give a lie to that incorrect view. Last few days,I have attempted ,on fb, to do that and seek other knowledgeable men to speak up for and against the subject.
In 1988 or thereabouts, SBI MF came into being to be the second MF outfit. Soon others such as CANARA came in too. In nineties , life insurance companies other than LIC made a debut thereby widening the market. UTI came up in eighties with ULIP to offer an investment product which offered tax shelter as well,while offering an equity linked MF product. Obviously these schemes opened up the market by providing a hybrid product offering the best of both worlds. You know what I mean.

The FERA dilution offerings of MNC companies shares to public in 1977 onwards caused the popularity of the Equity markets to sore suddenly by offering substantial gains to the retail investors . This was a welcome trade off from driving the blue chip foreign companies away and out of the country. Investment avenues were expanding beyond our expectations. When did NSCs come in ? These were there in 1980's surely. PPF was always one of the better tax-exemption driven investment avenue with one of the highest returns. It still could be. Returns being tax exempt.

In the situation prevalent today ,it seems to me that the new Life insurance companies have attempted to double as MFs in order to increase the AUM exponentially and to make their products more attractive. It is anybody's case whether the Life insurance companies should be allowed to do this. What are the practices elsewhere ?

One un-desirable outcome of this has been creating a confusion in the minds of the gullible investors ,conning them into opting for the Life Insurance products as an investment products. ( Informed view being that insurance products are not a good investment avenue at all, Not by a long rope.) Experts can say whether this is incidental or accidental or a scheming and inappropriate approach by the insurance companies to CON the retail and un-informed investors. My verdict as a senior banker and an investor is that this is of a doubtful variety. That is, Guilty till proved otherwise.

IIT(KGP), IIM (Ahemdabad)

10 data points that should shame our Higher Ed policy makers:

1. The total spend in US by Indian students is about 40000 crores. The total education budget in India is Rs. 30000 crores.
2. In 2017, The total engineering students passing out is about 1.5 million against a campus placement of 350,000. In 2008, it was 350,000 students passing out and all getting placed. On the other hand, we just produce 65000 doctors each year for servicing a population of 130 crores.
3. Higher education spend in the last decade has been Rs 1.76 lakh crore against a total tax cess collection for of Rs 86,538 crore. The governments invested just about Rs 15,500 crore (beyond the cess collected) in expanding capacities. That is just Rs 1,500 crore each year to serve the increased student aspirations.
4. GATE exam is based on everything you learnt at B.Tech. With pass percentage qualifying marks being about 25%, only 16% of the 1.5 million who appear Pass the exam. That is a tribute to rote learning.
5. If you leave your paper blank in the CAT exam, you are likely to get 55 percentile. And if the 1.7 lac people who appear for CAT, about 95000 will get a score less than this.
6. In the last 30 years, innovations in creating institutions of higher learning have been zilch. IIMs, IITs, AIIMS, NITs are the legacy of Nehru. NLU and IISER were the last of the innovations.
7. The new policy to determine Universities of eminence and give them freedom from regulations to break into world rankings of best universities is an oxymoron. It means that regulations by our own regulators are counter productive to creating good quality institutions.
8. Higher education is almost in private hands. In 2014, we had 777 universities 443 public and 334 private. By 2019, we will have more private universities than public universities. Similarly, In 2010, we had 26,000 colleges about 9,000 public ones and 17,000 operated by private players. By the turn of 2014, the total colleges grew to 36,000 10,000 in public (an incremental 1,000 colleges only), while the private colleges grew by 9,000 to 26,000 colleges. We estimate that in 2019, India would have 58,000 colleges with just 12,000 colleges being public and 46,000 operated by private players. So, by 2019, we will have more private universities and 79% would be in private colleges affiliated to a public universities. That means 85% students would be studying in a private college or a private university.
9. There is not one source that can give you complete information on higher education. MHRD, Ministry of labor, health, skill development and Law fight a continuous turf war while the students lose out. A)AICTE will not have students pursuing engineering in deemed universities. B) UGC will not have any details of the 90 Institutes of National importance etc. C) Medical Council and Bar council work for different ministries. D) Vocational training and skill development come under another ministry.
10. By 2028, India will have 350 million passing through the education system and looking for employment. India doesn't create more than 4-7 million jobs an Year.


Poonam Talwar Sayal

On Childrens Day I took my daughters out for a treat. The beautiful day was marred by an unexpected confrontation when two adolescent girls came to us begging for money!I have learnt not to encourage beggars and I believe that if everyone stops giving them alms, then they will stop asking and a sad habit will die off. So I refused to give the girls any money, instead I started asking them about their family. They refused to say anything except the pathetic words Kuchh de do, bhukh lagi hai. After a few futile attempts my husband said come with us and we will buy you something to eat, but again they were reluctant, just pressing on for money. I still wanted to take them with me but my husband very sensibly explained that any such step could land us in trouble with the kids family as well as the authorities. Our motive for taking them with us could be virtuous but people might make it sound ulterior and cause trouble. Anyway we had no official authority to do any such thing. Some NGOs might be authorized to take in the children for care-taking but we did not know any such agency. Anything unofficial can cause unnecessary trouble for the individual involved even if their motives are virtuous. So frustrated we moved on, my daughters following us reluctantly. When we sat in the restaurant my younger daughter seemed quite upset that we had left two hungry girls outside, while we were sitting down to a lavish meal. It was difficult making her understand why I had not given them any money.
This is an issue which has troubled most of us and left us feeling guilty and less humane but what can we do? This is a question that has always haunted me. If u try and feed these unfortunates, very few accept food, some very rudely throw the food and demand money instead, while others keep pleading for money…all the while expressing their pitiable plight. Very few are genuinely hungry and needy. For most it has become a profession. They want money only and not our food or concern. But these arguments apart, can we just leave behind a little girl who is telling us she is hungry? Even if she is just acting! Will giving her some money today ease her problems forever? Will she not beg again the next day? So giving her money once is not the answer to this quandary. We need to find an everlasting cure to this disease of begging.
Abroad there are government agencies or Social security Services, which take-in such homeless people and look after them. I think we also have a need for such agencies in our country, which can be held accountable and which can take these young children and other homeless beggars off the streets and offer them a better living environment. The agency needs to be transparent and the security of the inmates should be given priority. Many like me would love to be associated with such a group and help out in any manner but it has to be official.
Incidentally I had just joined the Forward India Forum and this incident made me realize the importance of groups such as ours, who can help find solutions to such problems if the members become a team and ensure that our voice is heard by all, especially the government. So I am hoping we can together address this issue so that all beggars can be provided for and the street children can be given better opportunities.