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Old 19th May 2007, 08:16   #121
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I can never understand that if a sector does not bring in any value growth to the country, there is talk of putting money, sops blah blah.
But whenever a sector or industry does well, there is lot of hue and cry and talk of "reigning in" as if doing well and being prosperous is a crime.

I was once listening to a very very rich businessman on TV. I won't mention his name because there is risk of flame wars erupting here, but he said something very very true.

He said something like this"Though the mindset is slowly changing, we Indians are apologetic of wealth. Its like its a crime to be rich. " At that time I felt its soo right. I don't know where this came from, but even if you do well by your own accord, without cheating anyone etc., still the public sentiment is that you have done a crime by doing good, by prospering, and you should be punished.

I can vouch for it that if the IT sector goes downhill, and grows stagnent, and does very bad, and instead of earning forex, becomes a drain, there will be talk of tax benefits etc., etc., but if it does well then the lynch mob gathers.

Once a post was made in the Official joke thread about 4 men and their beer. Its so relevant now.

I also fail to understand what price is the country paying. Of course if you count pollution and growing traffic jams, but then when incomes increase these problems will happen.
Apart from this urban chaos, the country's fiscal situation is much better than the license raj era, and the countries forex reserves and cash flow is better.

Before people say IT sector gets a lot of tax breaks etc., let me tell you its not the only one. Exporters never have to pay tax, but a software company employee whose company exports all the code has to pay tax.
Many states from past few years have been giving 0 tax sop to companies, a notable beneficiary being Honda in UP.

But its just that tax sops to IT sector etc., are highlighted. Nothing special as such is being done for IT/VITY sector. Before IT became big, and even now many other industries get equal benefits
I have no problem with 'zero-tax regime' for software companies. Only problem I have is that it seems software industry also needs devalued rupee to thrive as well. You have had it good for 10 years on devalued rupee. How much longer must other industries and people suffer on account of higher capital costs on imported machinary, higher fuel costs etc.

Now if we see the trend India is even falling short on production of wheat since past two years. This will mean even wheat will have to be imported, now just imagine the cost inflation if rupee continues to be devalued ??


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The difference is, IT was built on the common man's shoulders. Unlike most exporters, knowledge-based industries rely on their workforce to bring home the bounty. No fancy machines, no raw material, nothing. Which in turn means their employees share in their profits, which are on an international scale. Which in turn leads to more visible wealth among hitherto middle-class people. Which creates resentment among non-IT people.

I've personally heard these sort of comments go around before. IT/VITY guys, corporates, jet-set, the whole lot always get lambasted. It's funny no one ever shakes a fist at the Ambanis or the Bajajs or anyone else. Just your poor middle-class IT guy who works 10 hours a day and pays his taxes in full.
I have also heard a person called Vijay Mallya say in an interview that Indians are not people who begrudge anyone their wealth. I think he is true as well. Each state in India has its own culture, some have a grudge towards wealth and many others don't.

Ambani was until now dealing in polyesters, petrochemicals and other downstream ventures which didn't directly relate to common people who didn't quite figure out what he was all about. lol

Now that he is into retailing, a lot of attention is going to be showered on him.

Last edited by lurker : 19th May 2007 at 08:18.
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Old 24th September 2007, 18:54   #122
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Thought it is time to revive this thread

With inflation record low in India, as per XE.com - The World's Favorite Currency and Foreign Exchange Site, 1 USD = 39.50 INR

So, Rupee now rises as well.

PS: Those who observe SENSEX, probably noted that though index is going high, all IT companies are not doing that well [obviously]
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Old 24th September 2007, 21:23   #123
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Thought it is time to revive this thread

With inflation record low in India, as per XE.com - The World's Favorite Currency and Foreign Exchange Site, 1 USD = 39.50 INR

So, Rupee now rises as well.

PS: Those who observe SENSEX, probably noted that though index is going high, all IT companies are not doing that well [obviously]
yes, INR surely is getting stronger and most importantly breached a strong resistance level of 40, but the actual rate is at around 39.82 and not 39.50 as quoted in the sight. looks like a freak rate, when the markets open you will find the rate again around 39.80 level.
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Old 25th September 2007, 07:12   #124
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The difference is, IT was built on the common man's shoulders. Unlike most exporters, knowledge-based industries rely on their workforce to bring home the bounty. No fancy machines, no raw material, nothing. Which in turn means their employees share in their profits, which are on an international scale. Which in turn leads to more visible wealth among hitherto middle-class people. Which creates resentment among non-IT people.

I've personally heard these sort of comments go around before. IT/VITY guys, corporates, jet-set, the whole lot always get lambasted. It's funny no one ever shakes a fist at the Ambanis or the Bajajs or anyone else. Just your poor middle-class IT guy who works 10 hours a day and pays his taxes in full.
The problem with the IT/ITES/BPO Sector is that the benefits of employment don't have a trickle down effect on the economy....
I read somewhere ( dont know where but I think the Economist) - that for every 1 job created in the IT/ITES/BPO sector - 3 additional support jobs are created ( in restaurents, office staff, support staff, cabwallahs, etc ) - Compared to that 1 job created in the manufacturing sector - creates 9 additional jobs ( ancillary industries, logistics, transportation,suppliers et al)..

Hence the noise from many Indian Industrialists ...who are primarily in the manufacturing sector...Look no further than China..where SEZs in manufacturing have had such a superb trickle down effect on the economy....because of the HUGE number of jobs the manufacturing sector creates...

Also...the social strata of people who benefit from manufacturing compared to ITES/BPO...Many low income, rural, low skilled people benefit from manufacturing sector...compared to the ITES/BPO sector which benefits just the so called lower & middle class..moving them to middle/upper middle class..
Last i read ITES/BPO sector employs 1-2mn people..multiply that by 4(family size) ..multiply that by 4 again ( trickle down) & at best we have 16-20 mn people who are benefited by ITES/BPO..
Last I read...China lifted 250 mn people above poverty line in 20 yrs by a total focus on manufacturing...

Hence all the noise..
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Old 25th September 2007, 08:01   #125
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yes, INR surely is getting stronger and most importantly breached a strong resistance level of 40, but the actual rate is at around 39.82 and not 39.50 as quoted in the sight. looks like a freak rate, when the markets open you will find the rate again around 39.80 level.
oops sorry.

it should be "39.50 as quoted in the site" and not as mentioned above.
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Old 16th December 2009, 11:30   #126
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What is the best place to exchange $ in Bangalore? I had purchased about 500$ @ 47Rs per $. It has now fallen. Does anyone know of a place where they give you a good deal?
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Old 13th December 2011, 11:25   #127
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Default The Tumbling Rupee and its fallouts!!

Today rupee tumbled to 53.30 , previously only its effects on car industry were discussed but today with this entire economy will be affected due to oil import bill.
Only software billing professionals will be happy
What r other implications immediate and long run?
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Old 13th December 2011, 14:44   #128
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Default Re: The Tumbling Rupee and its fallouts!!

Your foreign holidays and the goodies which your friends have bought in their US trips are going to be lot more expensive
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Old 13th December 2011, 15:25   #129
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Default Re: The Tumbling Rupee and its fallouts!!

We could see another fuel price hike with the weakening of INR , imported capital good becoming more expensive. And Friends & family members returning from US becoming a little more rich
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Old 13th December 2011, 17:39   #130
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Default Re: The Tumbling Rupee and its fallouts!!

I remember a few organisations asking their employees to work overtime when the rupee was strong a couple of years ago. Will these same organisations now offer some compensatory offs or an extra day off during the week?
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Old 13th December 2011, 19:13   #131
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Default Re: The Tumbling Rupee and its fallouts!!

Quote:
Originally Posted by bullock-Car View Post
Today rupee tumbled to 53.30 , previously only its effects on car industry were discussed but today with this entire economy will be affected due to oil import bill.
Only software billing professionals will be happy
What r other implications immediate and long run?
Education abroad may become prohibitive for aspiring students, importers paying $$ will suffer, the list is pretty much endless.

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Originally Posted by SwiftSD View Post
We could see another fuel price hike with the weakening of INR , imported capital good becoming more expensive. And Friends & family members returning from US becoming a little more rich
Another effect of the dollar gaining is people like me who transferred all their $$ 4 months back feel the urge to
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Old 13th December 2011, 21:49   #132
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Default Re: The Tumbling Rupee and its fallouts!!

The number of strings in the Indian rope of economy have been steadily snapping. First, inflation, followed by RBI's monetary tightening leading to a credit crunch. That lead to a partial slowdown in the economy. The US and Europe debt crisis led to a flight of money from stock markets into safe havens such as Gold and Silver that saw Gold touching $1900+. Now that the dollar seems 'safer' again, and with the negative news flowing in India, investors are running away from the rupee like never seen before.

Add to all this mess is the government's failure to check food inflation due to supply-side and storage constraints and the lack of any policies being formed that could help India 'grow' out of this slowdown, things like infrastructure spending being one of them. FDI is on hold and has totally stalled the winter session of parliament, leaving several bills pending for review, basically nothing moving at all!

Today, Pranab issues a statement blaming it ALL on the Europe debt crisis and that the fundamentals of the economy were strong and Indians are resilient to crises. The last time someone issued such a foolish statement was when Ben Bernanke said it was all OK, just before the Housing bubble popped in 2008.

I could keep writing on and on, but in short, there is no quick fix for this mess.

Last edited by hellmet : 13th December 2011 at 21:52.
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Old 13th December 2011, 21:58   #133
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Damm! I had planned to bring alot of stuff from the US when my relatives come down here in Jan. will have to delete some items.

Anyone knows how long this will go on?? Will the rupee go back to its original position of 44-45 to a dollar?
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Old 13th December 2011, 22:13   #134
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Default Re: The Tumbling Rupee and its fallouts!!

As people start remitting money to India to cash in on falling rupee, everyone would want to take a piece of this pie.
Banks by offering upto 6% ROI - even after paying tax on interest income, one benefits remitting money than opt for a checking account abroad.
Real Estate Correction: Builders will try reducing their inventory. The current worldwide situation is probably going to result in lower intake of fresh recruitment 4-5 months down the line. That directly impacts a lot of local housing and rental.
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Old 29th August 2012, 09:39   #135
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Originally Posted by sgiitk
Let me add a few facts for consideration. A few years ago (5+) there was a socio economic study of the emigration from Korea and Taiwan. What was observed that once the real incomes (PPP basis!) crossed some point between 1/3 and 1/2 of the US incomes emigration ceased pretty abruptly. I guess we are approaching that point. The difference was probably due to the home vs alien environment, or whatever.
An excellent point indeed! Well said.

I would certainly like to be a first class Indian Citizen who has access to the better things of life right here in India and who is free to travel the world whenever I choose, provided I can afford the cost of such holidays etc.

I lament the fact that in India, we generally have little or no regard for human life, animal life, environment, quality of upkeep and maintenance of public spaces and property and the overall lack of a people friendly infrastructure.

I also lament that we have such a corrupt bunch of people in politics and bureaucracy, which tarnishes our overall good name!

One question I have is despite the great India Growth Story and the unstoppable rise of the consuming Indian Middle classes and a serious rise in overall prosperity levels across, why is our currency's value still so poor against pretty much any other currency? Consider also that Indians are the 4th largest spenders in the world when it comes to luxury holidays and such like!

Why should it be that I need to spend 8 or 9 Indian Rupees to buy even 1 Chinese Remnimbi or 18 rupees for a Malaysian Ringgit or 55 Rupees to a Dollar or 70 Rupees for an Euro or 80 Rupees for a Pound?

Why is our currency only seeming to fall lower and lower? I distinctly remember when the AUD was Rs 40, the USD was Rs 42 and the GBP was 70. This was just a short while ago!

Is this another scam on the part of the more powerful, better organized nations to keep us perpetually on the fringes and bordering on the outer darkness? Who decides this valuation? Should we not be asking some serious questions on this?

Also keep in mind that we probably have the largest personal gold reserves anywhere in the world. As per the Bretton Woods convention, the wealth of a nation is largely based on its gold reserves!

I might seem a bit naive but I dont seem able to get my head around this one!
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