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Saving for medical care low on Indians’ agenda: Survey

A majority of Indians felt that their financial condition would be better next year.

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SAVING enough money for retirement and child’s education have emerged as the top financial concerns across the globe. In India, however, affording medical care and saving money for emergencies have not figured as a major financial concerns. Instead, unemployment concerns have increased in India over the last year.

While rest of the world lacked confidence that they were saving enough money for retirement, India and Indonesia were exceptions as they felt confident about savings.

Around half of consumers interviewed in India, Singapore, Indonesia and Italy said they never invested in the stock market as compared to only 5 per cent of consumers in Hong Kong. Consumers in the US were most likely to increase their stock market investments as compared to last year.

According to American Express 2000 global investors sentiment survey across 11 countries and 11000 respondents from France, Germany, Italy, Spain, UK, mexico, USA, Kong Kong, India, Indonesia and Singapore, while 51 per cent sought advice from friends and relatives on investments, 20 per cent didn’t take advice from anyone and 15 per cent took cues from media, higher than all the 11 markets studied.

The survey revealed that compared with last year, concern about saving enough for retirement has increased significantly in France, Germany and Hong Kong and decreased significantly in India. While unemployment was the biggest concern in Spain, Hong Kong, Italy and Singapore, compared to 1999, unemployment concerns have decreased in France, Hong Kong, Mexico and the US.

Affording medical care emerged as the top concern in Indonesia and a major concern in the US. Across the 11 countries surveyed, around a quarter of people said they did not save at all and this shows no change since 1999. Levels of financial optimism were largely unchanged since last year with most consumers appearing mildly optimistic about their financial position over the next year.

The exception appears to be Mexico where confidence levels have soared. Markets with highest level of confidence are Indonesia, Mexico, the US and India. In European markets, most people predict no change in their own financial position.

Levels of optimism in the economy were the highest in Singapore, Mexico and Indonesia where the consumers predicting an improvement in economic conditions far outnumber the number of consumers predicting that conditions would get worse. In France, the US and the UK, the majority of people believed there would be no change in economic conditions in next one year.

Hai, this is sri ram, I one of the General Assignment Reporter, at timesnowindia.com, We mainly cover timely news, educational and entertainment, sections. - Chief editor, politico-social activist, software engineer at Accenture India.

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Business

Karnataka guaranteed paper upgraded to A+

increasing share of the tertiary sector in the state’s economic output has added stability to the state’s economy

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AT A time when several state governments have seen their ratings downgraded, the Karnataka government-guaranteed papers have been upgraded to A+ (so) (adequate safety with relatively higher standing within the category).

This puts Karnataka in the same league as Gujarat, which currently has the same implicit rating outstanding from Crisil.

It may be recalled that in the past one year or so, Crisil has downgraded the implicit ratings of two state governments: Orissa and Maharashtra twice.

Speaking to ET, Crisil’s head of infrastructure ratings, Sharad Jain said, “Karnataka has maintained fiscal prudence, as is reflected in its low deficit levels, debt to revenue receipts ratio and higher interest coverage levels, as compared to other states. Besides, Karnataka did not have to resort to ways and means advances from the Reserve Bank of India in the past three years.”

Crisil has upgraded the ratings assigned to eight bond issues, worth a total of Rs 2,479.2 crore, issued by Krishna Bhagya Jala Nigam from A (so) to A+ (so). The rating agency has also assigned an A+ (so) rating to a Rs 1,200-crore fresh bonds programme of the state government undertaking.

The ratings are based on the credit enhancement mechanism, in the form of an unconditional guarantee by the government of Karnataka, to meet the debt servicing obligations on the bonds and tripartite agreement between KBJNL, GoK and the trustees to the bondholders, facilitating timely payment of dues to bondholders.

KBJNL’s own revenues are not expected to be sufficient to meet its debt servicing obligations in the short to medium term.

The interest and principal repayments on the rated bonds are expected to be met through budgetary support provided by GoK to KBJNL.

Therefore, the ratings reflect the ability of GoK to service the debt obligations on the rated bonds, said a Crisil release.

The upgrade in KBJNL’s ratings is based on GoK’s sustained fiscal prudence leading to a consistently sound fiscal performance, as reflected in relatively lower revenue and fiscal deficits, low debt levels, high interest coverage and healthy liquidity position, as compared to other states.

The ratings are supported by a healthy growth in GoK’s revenues and outstanding tax effort, the release added. GoK’s relatively high per capita developmental expenditure is expected to lead to economic betterment in the medium term.

The increasing share of the tertiary sector in the state’s economic output has added stability to the state’s economy with a decline in dependence on the primary sector and a rise in per capita income levels, said Crisil.

KBJNL acts as a financing and implementing agency for the completion of Upper Krishna Projects in the state of Karnataka. The UKP was envisaged to tap the potential of the Krishna Basin for the purpose of irrigation and generation of hydro-electric power.

KBJNL is the nodal agency for the completion of the unfinished irrigation projects in the state in order to meet the Bachawat award, which addresses the issue of water sharing between the states of Karnataka, Andhra Pradesh and Maharashtra, the release said.

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Power regulators increasing risks: Crisil – Mumbai

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THE SETTING up of regulatory commissions has exposed power utilities to higher regulatory risks. This assumes greater significance in view of the fact that power utilities in India are operationally not very efficient, said rating agency Crisil.

The setting up of regulatory commissions in several states has been a welcome feature that is expected to make the power sector more efficient. The regulatory commissions are primarily conceived as tariff setting bodies that are expected to play a balancing act where the interests of all stakeholders are to be taken into account.

This is illustrated from the marginal tariff increases along with stipulations to reduce high level of Transmission & Distribution losses granted to power utility companies in Maharashtra and Orissa.

Crisil believes that states like Maharashtra and Gujarat, that are excessively dependent upon costlier power purchases from IPPs, are thus exposed to higher regulatory risks. This is because, the regulatory commissions factor the cost of power purchase to determine the extent of tariff hike, based upon the concept of merit order dispatch.

This has influenced the tariff award given by Maharashtra Electricity Regulatory Commission, wherein the regulator has asked Maharashtra State Electricity Board to cut down power purchase cost by following merit order dispatch.

Crisil expects the regulatory risk to continue to be one of the key rating determinants in the power sector, in the short-medium-term. This view arises from the fact that certain states have been facing delays in their respective regulators granting tariff increases.

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Canadian MF to expand Indian operations @ New Delhi

CANADA-BASED mutual fund major Dundee is expanding its India operations

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CANADA-BASED mutual fund major Dundee is expanding its India operations in a big way in line with its focus on wealth management for non-resident Indian clients.

To start with, the holding company for the group in India, which is registered as a non banking financial services company with the Reserve Bank of India, namely, Dundee Bancorp, has applied to the RBI for a full-fledged money changers licence.

The holding company currently has a restricted money changers licence from the RBI.

“Currently, we are catering to the investment and money management needs of our NRI clients via Dundee MF and our other group concerns. The idea is to broaden this focus to complete wealth management solutions,” Dundee Mutual Funds president Sunil Joseph told ET.

On the mutual funds side, the AMC is planning to launch a pure growth scheme and an index fund in the next two months in addition to introducing a cheque writing facility for its gilt and liquid funds in the next three weeks.

“At Dundee Capital Markets we are focusing on building a business of distributing mutual fund products. We will also offer segregated account wealth management facilities, ie portfolio management schemes for offshore clients and onshore clients under the aegis of Dundee Investment Management & Research, the investment manager for Dundee Mutual Funds in India,” Joseph said.

Once the regulatory issues are resolved, another group company Dundee Securities Company, is planning to set up trading terminals in London and Dubai to offer stock trading facilities for NRI clients. To facilitate this, the company has already acquired seats on the Bombay Stock Exchange and the Inter Connected Stock Exchange of India.

Other initiatives on the mutual fund front include setting up of a two-tier e-commerce enabled website and providing one-business-a-day redemption facility to investors in its Liquid fund.

Currently, Dundee Mutual Fund offers three open end debt-oriented schemes and two open-end equity oriented schemes in India.

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