Intellectual Thoughts by Sanjay Panda


Agricultural reform

When the National Commission on Farmers (NCF) mooted the idea of putting agriculture on the Concurrent list of the Constitution so as to bring it under the direct control of the Centre, nobody expected the states to readily agree to this radical suggestion and that’s what happended during the meeting of state agriculture ministers who met in New Delhi last week to discuss the recommendations of the NCF. No party in power would want to give up control over policies and programmes that could influence the vast rural vote bank. But that does not mean that there is no merit in NCF’s proposal, which was aimed primarily at addressing the issue of multiplicity and dissimilarities in taxes and levies, marketing laws and curbs on goods movement in different states.

The present scenario is far from conducive for creating a single all-India market for agricultural produce, which is what has been suggested by the NCF in one of its preliminary reports. While getting agriculture onto the Concurrent list will not happen in the foreseeable future, it is good that the states have endorsed most of the other recommendations of the NCF which included, significantly, the point that a distinction should be made between minimum support prices (MSP) and the procurement prices at which the government buys grain for its buffer stocking operations and for feeding the public distribution system. This means that market intervention at the MSP should be only to prevent distress sales by farmers, while grain procurement for the public distribution system and the various welfare schemes (like food-for-work) should be on commercial terms. Had such an approach been adopted in the last rabi marketing season, wheat procurement would not have been so low as to necessitate 5.5 million tonnes of imports by the government, at heavy cost to the exchequer.

Equally noteworthy is the NCF’s recommendations regarding the conservation of soil and water resources, and its opposition to the allotment of prime agricultural land for the creation of special economic zones and other non-agricultural purposes. Any perceptible shrinkage of farm land would not be advisable, especially at a time when the overall farm productivity has tended to stagnate, for it would gravely impact growth in the agricultural sector. In fact, what is needed is reversal of the process of land degradation through a massive programme for the reclamation of degraded lands so as to bring them under crop cultivation or, else, under productive plantation or forest cover. The objective of most NCF recommendations is to improve livelihood and income opportunities for farmers so as to prevent them from falling into a debt trap, leading to extreme cases like suicides. The need for moving in this direction is borne out by the National Sample Survey finding that over 40 per cent of farmers want to give up farming because it does not yield an adequate income. The NCF has suggested creation of income-generating opportunities in villages through activities allied to agriculture, besides in the non-farm sector. Now that the formulation of a national policy for farmers has begun, on the basis of the recommendations of the NCF and the views of state governments, these issues should be kept in focus and emphasis must be laid on the farmers income & livelihood rather than the cheap vote bank politics which politicians are exploiting for last several decades.

Money - 7 good reasons to invest in SIP's

Fact No. 1: Over a long term horizon, equity investments have given returns which far exceed those from the debt based instruments. They are probably the only investment option, which can build large wealth.
Fact No. 2: In short term, equities exhibit very sharp volatilities, which many of us find difficult to stomach.

Fact No. 3: Equities carry lot of risk even to the extent of loosing ones entire corpus.

Fact No. 4: Investment in equities require one to be in constant touch with the market.

Fact No. 5: Equity investment requires a lot of research.

Fact No. 6: Buying good scrips require one to invest fairly large amounts.

Systematic Investing in a Mutual Fund is the answer to preventing the pitfalls of equity investment and still enjoying the high returns. And it makes all the more sense today when the stock markets are booming.

1)It's an expert's field – Let's leave it to them
Management of the fund by the professionals or experts is one of the key advantages of investing through a mutual fund. They regularly carry out extensive research - on the company, the industry and the economy – thus ensuring informed investment. Secondly, they regularly track the market. Thus for many of us who do not have the desired expertise and are too busy with our vocation to devote sufficient time and effort to investing in equity, mutual funds offer an attractive alternative.

2. Putting eggs in different baskets Another advantage of investing through mutual funds is that even with small amounts we are able to enjoy the benefits of diversification. Huge amounts would be required for an individual to achieve the desired diversification, which would not be possible for many of us. Diversification reduces the overall impact on the returns from a portfolio, on account of a loss in a particular company/sector.

3. It's all transparent & well regulated

The Mutual Fund industry is well regulated both by SEBI and AMFI. They have, over the years, introduced regulations, which ensure smooth and transparent functioning of the mutual funds industry. This makes it safer and convenient for investors to invest through the mutual funds.
4. Market timing becomes irrelevant One of the biggest difficulties in equity investing is WHEN to invest, apart from the other big question WHERE to invest. While, investing in a mutual fund solves the issue of 'where' to invest, SIP helps us to overcome the problem of 'when'. SIP is a disciplined investing irrespective of the state of the market. It thus makes the market timing totally irrelevant. And today when the markets are high, it may not be prudent to commit large sums at one go. With the next 2-3 years looking good from Indian Economy point of view, one can expect handsome returns thru' regular investing.
5. Does not strain our day-to-day finances Mutual Funds allow us to invest very small amounts (Rs 500 – Rs 1000) in SIP, as against larger one-time investment required, if we were to buy directly from the market. This makes investing easier as it does not strain our monthly finances. It, therefore, becomes an ideal investment option for a small-time investor, who would otherwise not be able to enjoy the benefits of investing in the equity market.
6. Reduces the average cost
In SIP we are investing a fixed amount regularly. Therefore, we end up buying more number of units when the markets are down and NAV is low and less number of units when the markets are up and the NAV is high. This is called rupee-cost averaging. Generally, we would stay away from buying when the markets are down. We generally tend to invest when the markets are rising. SIP works as a good discipline as it forces us to buy even when the markets are low, which actually is the best time to buy.
7. Helps to fulfill our dreams
The investments we make are ultimately for some objectives such as to buy a house, children's education, marriage etc. And many of them require a huge one-time investment. As it would usually not be possible raise such large amounts at short notice, we need to build the corpus over a longer period of time, through small but regular investments. This is what SIP is all about. Small investments, over a period of time, result in large wealth and help fulfill our dreams & aspirations.

Technology- Digital printing market in India

It’s a war out there to grab a share of the growing digital printing market in India. The printing and graphics industry is expected to turn a shade brighter in 2007-08. The Indian digital printing industry is projected to grow to $17 billion by 2010, from an estimated $11 billion in 2005 (as per print and packaging research organisation, Pira International). Gone are the vendors’ obsessions with niches where digital printers might be lucky enough to find a hundred thousand impressions per month. For that matter, a number of the digital print providers who pursued those niches are gone, too.
A buoyant industry estimates that between 2006 to 2015 digital printing products (world-over) will account for almost 30-35 per cent of the overall printing market. In 2005-06, the emphasis shifted from the niches for digital printing to sheer volumes as vendors ramped up shipments of new high-capacity digital colour presses with lower operating costs. The resulting explosion in volume was no surprise. “Digital colour printing is finally on the threshold for the explosive volume growth that monochrome digital printing experienced in the last decade.
In its endeavour to spread awareness about the digital printing industry, Xerox India along with Karnataka State Printers Association and the Government of Karnataka announced a joint tie-up for setting up the first-of-its kind print testing and training centre in Bangalore and has also set up a Xerox Innovation & Technology Excellence Centre with an investment of Rs 5 crore. Expecting growth for personalised print jobs, print-on-demand, shorter run lengths, Xerox and HP hope to tap verticals such as banking, telecom, insurance, retail, manufacturing and graphic arts. HP also intends to play an important role in all the e-governance projects defined by the government of India. Lexmark, on the other hand, is aiming for the Internet companies, BPOs and KPOs to fuel its growth. “With India being one of the world’s largest IT hot-beds, the demand for digital printing equipments is bound to escalate. With one third of digital work expected to be personalised by the end of 2006, personalisation and customisation are the two big trends where Xerox, HP, Lexmark and Canon hope to play a key role.
In an industry dominated by low-cost conventional printing technologies such as offset, flexography, and gravure, it is not surprising to note the demand for digital printing is shaping out to be highly elastic in nature. Applications like Web-to-print, variable data printing and short-run digital printing have been a hit among creatives and publishers, telecom and financial institutions. “Innovation from a product generation perspective would continue to be around the three vectors — cost of printing (a combination of equipment media and ink), image quality and speed.” HP has recently revealed a breakthrough technology, Edgeline, which, it claims will change the way enterprise customers look at printing. The penetration of digitised variable data printing is facilitated due to the need for regional or local messaging (in B and C class cities) either on the telephone bills, tax statements, and receipts that no offset printer can manage. Digital monochrome and colour printing together account for less than 3 per cent of the volume of publication and commercial printing in 2006 but is predicted to reach 25 per cent by 2010. Nevertheless, digital printing is not going to overpower the traditional industry anytime soon. However, the digital segment will soak up most of the growth across the total market. That sure is great news for those print providers who are going digital and is also a challenge for the rest to get moving.