Are SIPs Instilling New Hopes in Mutual Funds?

by Vinaya HS on July 22, 2017

in Finance

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According to the data from the Association of Mutual Funds in India (AMFI), SIP investments for the month of April 2017 hit an all-time high of Rs. 4,200 crore crossing a 1 crore-mark in number of SIP accounts. This is following a stellar year of inflows in the market via mutual fund SIPs that recorded Rs. 3,989 crore for the month of March 2017 as opposed to Rs. 1,206 crore monthly in 2014.

In the past one year, there has been a massive jump in the growth of SIPs and number of registrations. Experts have postulated a variety of reasons why SIP investments have instilled new hopes in Mutual funds. With SIPs and any mutual fund investment, you enjoy the power of compounding. As you invest every month, the returns on your existing corpus is reinvested back into the fund thereby maximizing your potential returns.

Suppose you’ve invested Rs 10,000 in a fund that provides a 10% returns annually. At the end of the year, you would have earned Rs 1,000 in interest. In the second year you will make Rs 1,100 because not only your initial investment of Rs 10,000 accrues interest, but the additional Rs 1,000 that you made in the first year yields you money.

The 10th year interest would be Rs 2,358 and in the 30th year you will stand to make Rs 15, 864 – All this without making a further investment beyond the initial Rs 10,000. Now imagine the possibilities, if you were to invest this amount every month or on a quarterly basis. Also, you can start with as low as Rs 500 per month.

Principle: Rs. 10,000

Interest rate: 10%, compounded yearly

Another popular reason for opting for SIPs is the rupee cost averaging feature of the SIP that can ease out the average cost per unit over time. Essentially, this means an investor can purchase more units when the prices are low and less units when the prices are high.

SIPs can be used to achieve your financial goals like meeting funds for a child’s education, expenses for a marriage and to even create a corpus for a secured retirement life. By the power of systematic investing, you can harness the power of the stock market to get returns that other investments seldom provide.


Why Entrepreneurs Should Opt for Personal Loan?

by Vinaya HS on July 22, 2017

in Finance

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Any business, no matter scale or size, requires seed capital or an initial investment to get started. While some do not need to take on debt to raise this initial capital, the key is how to make debt work for you.

There is obviously a cost involved when it comes to starting a business and there also operating expenses that may extend well beyond your revenue, especially during the first few years before you break even or when you’re trying to scale up. While there are many options for raising capital, all of them come with pros and cons.

Many venture capitalists and angel investors would be happy to funds to set up your business in exchange for a stake in your company. While this seems like a good option, parting with equity I a risky option considering that most people expect their business to be valued well beyond their expectations in a few years’ time.

You may be also able to secure a business loan, but it is likely to be secured by means of a collateral like property or other assets like gold or fixed deposits, but should your business not turn a profit you stand to lose your collateral.

A good option is to go into personal debt, accumulating personal loans which is a viable option, as long as your personal credit is in good shape, unless you already high debt that could adversely impact your credit score. Securing the loan with a personal asset may help you get even better interest rates and conditions, but by the aforementioned logic, providing collateral means you stand to lose it if you are unable to repay the loan.

A personal loan is a good idea if you are hopeful of turning a profit relatively early according to your projections. The fact that you will have to pay an equated monthly installment once the loan is disbursed should also be taken into account.


GST Impact On Banking Services

by Vinaya HS on July 15, 2017

in Finance

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The Indian banking industry is one of the biggest service industries. In our country, there are several private and government banks. GST news suggests that like many other service industries including insurance and trading, banking services will also be hugely impacted.

The new tax structure, GST, has finally become a reality. After the GST roll out on July 1’2017, be ready to shell out some more money for banking services according to the GST news today. Also,the implementation of GST in the banking sector will not be very smooth. Since the ambit of banking services and its operations are huge, we can only hope for a smooth transition.

Impact of GST on Banking Services

The GST news confirms that the GST is going to increase the cost of banking services. As of now, the service tax rate which is charged for the banking services is 15%. But under the new GST model, this tax rate has been increased to 18%. Hence, making the banking services costlier by 3%.

If the customer demands more than 50 cheques a year, he will have to pay the service taxand Rs.75 for each cheque book. However, the rates for cheque books vary with banks. Pre-GST, the banks charged Rs.15/- for 3 months for sending SMS alerts. But now customer would have to pay Rs.18/- for SMS alert service. Though, this is marginal, but more burden on customers also comes along as most of the banking services like fund transfer, debit card, ATM with drawl after a few free transactions, home loan fees, locker rentals, passbooks (duplicate), bill collection, cash handling fees, outstation bill collection, demand drafts, RTGS, safe deposit customer charges, NEFT etc. is going to become way costlier.

For example, for ATM withdrawal services, the customer will have to pay Rs.3/- more for every Rs.100 for banking transactionsleaving the hole in pockets of customers. However, exact impact of many services cannot be still ascertained.

Deploying ATMs will be most expensive as it is part of the highest GST slab of 28% as per the GST news today. Smaller banks may find hard to cope-up with the increased prices and hence may step back from deploying many ATMs causing a hit in the banking services.

For banks, finding out if a transaction is intra-state or inter-state and whether the payment is for CGST, SGST, or IGST is a difficult.The GST news today also highlights that a transaction held between the two separate branches of the same bank will also be charged GST.

Inspite of all the challenges, it is expected that it will be easier to do business under GST. Keeping in mind the benefits like the creation of a national market, ease of doing business, better productivity, improved tax compliance, the GST will bring, the industry has welcome the new tax reform. Though business news suggests that the banking services would cost more now, but in the end the consumers will avail the benefit of GST in long run.

For more on Business and Stock Market News, visit BloombergQuint.


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In the recent times, it has been noticed that the investors are looking for additional options to ensure the safety of their funds. It is rightly said that investing in only one or even in two options is not the right way to invest. By diversifying the funds in different investment options, one can mitigate risk and have a secure future in terms of liquid assets.

Keeping in mind that more investment options will increase the chances of investment in the market, Securities, and Exchange Board of India (SEBI) has finally allowed trading in commodities futures. The future market is based on the strategically designed investment in one or more commodities via Future Contracts. These future contracts obligate the buyer to buy the commodity or seller to sell the commodity in future at a predetermined price on a specific future date. As per legal news, the regulator has said that only one commodity will be allowed per exchange as a pilot project.

SEBI allowed the commodities exchanges to launch futures contracts back in September 2016 but there was a lack of clarity on the settlement and pricing. Thus the commodity exchanges did not launch the options. Legal news is out that SEBI has finally laid down the rules and set the cap for the minimum daily average turnover to be considered as a commodity option. As per the rules, if it is an agricultural commodity, it has to have an average daily turnover of at least 200 crores. On the other hand, for the non-agricultural commodity, the cap is at a higher value of 1000 crore. In addition to that, the commodity should be one of the top five in the respective exchange to be considered as an option in the futures market.

SEBI has laid down the rules during the board meeting on 26th April 2017 and finalized the required amendments in Stock Exchange and Clearing Corporation (SECC) regulations and Securities Contract Regulation Act. Experts in the know of legal news suggest that with the change in the rules and regulations, the exchanges have the power to introduce options which had future contracts as underlying. The option contracts will be converted into futures contracts on the day of expiry.

There are changes in the delivery system as well. Before the new rules set into action, the commodity has to be delivered either in form of cash or in physical delivery which poses a lot of hurdles in terms of logistics. The new rules have introduced a wide range of options for settlement as well which will make it easier for the sellers and buyers to complete the transaction.

The exchanges have shown positive signs on the launch of the trading in commodity futures and it looks like the benefits will start to show up for both buyers and sellers very soon in the near future.

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Typically, a zero balance account would refer to a checking account or a current account which is automatically set to be at a zero balance all the time. When the account holder makes a check payment, only the amount written on the check is transferred to the ZBA to maintain a zero balance as soon as the check has been paid. Funds are automatically transferred from a master account only when checks are presented, and only enough to cover those amounts each time.

Some of the applications of such an account are companies that require a zero balance account to eliminate excess balances in different accounts, and to monitor their payments more carefully. However, with the rise in banks charging average monthly and quarterly balances for their savings and current accounts, the term zero balance account is also popularly used these days for accounts that do not require the account holder to maintain any idle balance in their account.

Post demonetization in 2016, many savings accounts across the country were flush with funds and as a result, the interest that banks are required to pay on the savings account balance increased & several banks, both private and public sector began levying charges for non-maintenance of a certain minimum average monthly or quarterly balance.

With customers unwilling to abide by the new rules, the traditional zero balance account that does not accumulate charges in case of non maintenance of said balance, has become popular again. The zero balance USP is used to indicate that no unnecessary charges will be levied for operating the account.

In exchange for maintaining said balance, banks offer attractive interest rates and this segment has become quite competitive off late. There are different types of zero balance accounts depending on the context of the situation. However, as the name suggests, it is most likely that it is an account that does not require you to maintain any balance.


Impact of GST on Wholesalers and Retailers

by Vinaya HS on June 27, 2017

in Finance

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The goods and services tax or GST is likely to get rolled out from July 1’2017. The introduction of this new and unified tax system or GST was imperative, given the current complicated tax structure in the country. Looking at the bigger picture, GST is going to be one of the biggest boon for Indian economy as after the GST implementation the growth in the GDP of India is expected to increase by at least 2% as per the latest GST news. Since GST is expected to convert many non-tax payers to tax payers, a major benefit expected is that it will increase the tax revenue for the government and lower the tax burden for many.

According to the GST news, the traders are not yet comfortable with the new form of taxation and they are finding it difficult to adopt the change. As per some sources, government is receiving requests from industries to delay the implementation of GST; however this doesn’t seem likely to happen.

Impact on wholesalers and retailers

Under the current scenario, most of the wholesalers and retailers do not pay taxes as there is no mechanism which can track their correct amount of sales and purchase. Since there is no invoice or bill, the question of any document of sale and purchase in writing does not arise. After the implementation of GST, they will have to present bills digitally where the GST platform will monitor them as per the latest GST news. Since the entire supply chain will be monitored, tax evasion by the wholesalers and retailers will become much less likely. A few months earlier, the retailers were hit by demonetization when many companies suffered drop in sales due to low customer demand and they had to de stock. Many of them consider GST to be yet another setback.

However, the benefits GST has to offer over shadows the initial hesitation of GST acceptance. IF the GST news coming in is to be believed, the new tax structure is likely to impact wholesalers and retailers in a positive way. GST will eradicate the chances of double taxation and hence lower the overall tax burden. Also, since the base of the tax payers will increase, it will reduce the overall tax rate. GST is going to bring a uniform taxation system across the states of the country and hence the flow of goods and services across the state will be smoother and easier due to reduced transportation and administrative cost. GST will also smoothen the flow of goods and services to make the entire supply chain organized and structured.

GST is an integrated tax that benefits the wholesaler as it eradicates the cascading effects of tax and automates the process of compliance making it easier. GST also removes the octroi charges hence is a big relief to the wholesalers. GST news from reliable sources points out that the new regime will impact the retailers favorably as it will reduce overall indirect taxes, increase the efficiency of the supply chain, create a unified input tax credit, create seamless integration of goods and services, etc.

GST will also bring more suppliers, distributors and vendors in market due to easy procurement of goods, easy availability of raw materials and a better supply. Legal news in India points out that a simple taxation or GST will help in fewer compliance burdens, transparency in business, faster transportation, better logistics, improved supply chain, and better margins. Retailers will also be benefitted as the cost of the basic and essential commodities are expected to reduce after GST.

The retailers and wholesalers who will not be able to comply with the new GST might suffer. As the GST news recommends, they must fall in line as soon as possible and get digital to make themselves registered and compliant.

Stay updated with the latest business news in India on BloombergQuint.

Read more on the latest GST tax rates in India.


Impact of GST on Textile Industry

by Vinaya HS on June 27, 2017

in Finance

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One industry that has its eyebrows raised over GST and its impact is the textile industry. Textile industry is one of the oldest and biggest industries in India. Indian textile sector is the largest employer and is a significant contributor in the country’s export. It gives job opportunities to both skilled and unskilled labor in India. The unorganized small scale traditional businesses like sericulture and handicrafts and organized sector including technical and modern technology business like apparel and garments etc are all a part of this sector. More than 35 million people are engaged with the textile industry of India where the share of textile in the total export of the country remains to be around 10% to 11%. This means news on GST is eagerly awaited in this sector.

As market news suggests, the Indian Textile Industry contributes to around 5% to India’s GDP and around 14% to Index of Industrial Production or IIP. The advent of GST will definitely bring an impact in the textile industry.

GST news trickling in seems to give an indication that one major impact the GST is going to have on textile industry is that it is going to charge higher tax rate. Currently, the cotton value chain in the textile sector is not charged any central excise duty and was further supported with subsidy etc. But after the GST implementation, as per the news of GST, the natural fibers like cotton and wool will be taxable under the new regime.

But a deep dive in shows that the tax rate would remain the same for almost all the product categories. According to the rating agency ICRA, the effective tax on cotton was about 5% and on man-made fibers is around 11%. As per GST news, the tax rate is going to be somewhat same even under the new tax laws. In fact, for wool the tax rate may be lesser at 5% than the current 10%. Other than the man-made fibers (MMF), the GST rates for all other categories like cotton, silk, jute, wool have been kept in either zero or lowest tax slab of 5%.

News on GST suggests that looking at the long run, the picture is quite bright. The introduction of GST will imply a better input tax system as per the GST news. Currently the input tax credit is not allowed if the inputs are procured from the unorganized sector. Now the shift from unorganized sector to the organized sector is likely to happen after GST.

In the current tax system, the textile industry pays the excise duty on importing the latest machinery which is not treated as the input tax credit on capital goods, but under the new GST rule as the GST news points out, the input tax credit will be made available for the tax paid for procuring this kind of machinery. Since GST is a unified tax system and it is going to subsume all indirect taxes including octroi, luxury taxes, entry tax etc. it is expected that the cost of manufacturing the products for textile industry will be reduced since these indirect taxes will be removed. Availability of input tax credit will also make the Indian textile industry more aggressive in the international textile market.

If the news on GST from different quarters is to be believed, GST is likely to boost the Indian textile export market because after the roll out of new tax structure, the procedure will be easier and there would be no duty drawback. GST will also bring many non-tax payers into the taxpaying bracket and hence will improve the situation significantly. The textile industry now will be more organized and systematic.

Looking at the pros and cons, it might be concluded that GST might have a neutral impact on the textile industry if not positive. In the current time, we may feel that the tax is going to be charged way higher but for a long term sustainable growth of textile industry, such changes must be adopted and positively accepted. The GST news does seem to be positive for the textile sector in the long run.

Stay updated with the latest business news on BloombergQuint.

Read more on the latest GST tax rates in India.


Impact of GST on Mergers

by Vinaya HS on June 27, 2017

in Finance

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The Indian economic reforms back in the year 1991 had created a lot of scope and challenges for the Indian businesses and industries in the domestic and global market. It became essential for the companies to keep pace with the cut throat competition on national and international level. This led to the acceptance and growth of the process of mergers and acquisitions. In today’s world, M&A has gained a lot of significance. The companies opt for Merger to restructure their organization and keep them at a competitive position in the market. Acquisitions are another way where a company takes over another company to expand their market presence. Companies planning mergers in the future are following news on GST closely to get an idea on how they might be impacted.

The impact and effect of the taxes becomes a matter of primary importance to the companies who adopt M&A. GST news today is giving some indications of the changes that are in the offering.

As per GST news, it is believed that the daily transactions of sales, mergers, acquisitions and other forms of unifications that do not have output-linked GST obligation, might not be impacted by this tax. However, the clearer picture is yet to come. The latest legal news suggests that, there is still a lot of haze on the issues such as details of itemized sales, blurred language regarding slump sales, problems regarding valuation for shares, out-of-court settlement issues and many more.

The updates on the M&A news on GST and the CGST sheds some light how the tax will be levied on the sale of the assets. This sale of assets can be done either as itemized sale or as a slump sale. GST is quite clear when it comes to the itemized sales, but how a slump sale will be treated is yet to be discerned. An itemized sale would mean sale of of assets and liabilities where the value of each item is known along with the value of goodwill and liquid cash etc. which can be easily calculated. Under GST, this can be treated as a supply transaction. But the CGST Act does not clearly say whether the transfer of a business in the case of slump sale would be taxed or not. Also whether there will be tax exemption or exemption with the refund of ITC or input tax credit (zero rated) in case of a slump sale is not clear. However news on GST does seem to imply that there will be no GST on slump sales as per experts.

In case of services transactions, where the company does transactions of goods and services via shares, the GST news today does not make the treatment of GST clear. Some experts believe that fair market value of share will be taken into account on the date of issue for calculating GST while other believe that since supply of shares does not become part of GST and hence no tax will be levied on service transactions. The same confusion is there in the matter of out of court settlement and the GST news today has not shed further light on the same.

There are many companies like BPCL, L&T, Mahindra, GE shipping, Sun Pharma, Sundaram Finance, Religare Enterprises, etc. who in order to save tax, lower their multiple legal implications, and reduce otheroverhead costs are is a hurry to have merger with their subsidiaries before the GST comes into force. News on GST suggests that this is being done because the subsidiaries which were created to avail the excise duty incentives will be immaterial under GST. According to the GST news today, under the GST rule, the cascading effects of CENVAT and Service Tax will be eliminated and hence merger of subsidiaries will help to reduce the compliance cost.

Stay updated with the latest business news on BloombergQuint.

Read more on the latest GST tax rates in India.


Impact of GST on Agricultural Sector

by Vinaya HS on June 24, 2017

in Finance

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Narendra Modi-led government did not expect a smooth sail for the proposed GST bill; nor did they expect this much of opposition either.

It is 63 years since the first GST regime came into being in France. Many countries followed suit with varying duty structure. It took 24 years from the recommendation of Raja Chelliah to have tax revision. The existing rate of GST in is not uniform worldwide (Australia 7%, Japan 8%, Singapore 5%). The GST in India is high, but unlike other countries, GST is not uniform for all products, but there are six slabs. (Originally four slabs were proposed, but later, two more slabs – 0.5% for uncut diamonds and 3% for gold was added).

And mysteriously the biggest revenue earners liquor and petroleum products are outside the purview of GST.

Impact of GST on agricultural sector

The impact of GST on the agricultural front, the biggest contributor (16%) to India’s GDP seems to be more or less brighter. The transportation, logistics, and preservation are the significant value additions for agricultural produces. The time factor of production centre to the consumer is cut down.

For the first time, the market for agricultural products touches a national level, but no clarity on GST for tea, coffee, milk, etc. is ready yet. Present tax exemption under CENVAT for rice, sugar, salt, wheat, flour will not be applicable under GST. Also, the concessional VAT under state law of 4% for cereals and grains will be taxed higher. The exemption enjoyed for unprocessed food products like meat, eggs, fruits, vegetables, etc. under state VAT also would cease to be so.

Due to the different state VAT and APMC (Agricultural produce market committee) laws, implementation of centre Government’s NAM (National Agricultural Market) scheme would be challenging in the wake of GST. Equally challenging would be the emerging e- commerce of agricultural commodities.

The adjustment of indirect taxes in the GST will create a transparent, hassle-free supply chain on pan India basis. However, present earning of state governments on account of CST/OCTROI/Purchase Tax will be curtailed. (Maharashtra, Punjab, Gujarat and Haryana stand to lose more than Rs. 1000 crores in this regard).

The ease, with which agricultural goods are transported between States, as well as the convergence of taxes under GST, may be advantageous in a National Agricultural Market.

A better supply chain mechanism means a reduction in wastage, time and cost. The agricultural machinery would cost less after implementation of GST. However dairy farming, poultry farming, and stock breeding which are kept out of the definition of agriculture and taxable under the GST. Fresh milk with zero GST is a welcome sign. The tea price rise would affect the household budget by at least 5%.

The single unified national agriculture market would be beneficial from an overall perspective. But the fear of inflation grips the nation. GST would ensure that farmers in India, who contribute the most to GDP, will be able to sell their produce at a higher price. An agriculturist, for the purpose of agriculture, is not required to register under GST.
Under the model GST law, dairy farming, poultry farming, and stock breeding are kept out of the definition of agriculture. Therefore these will be taxable under the GST. The main impact of GST on agriculture is that it would bring in the inflation.

With currently 4% VAT being increased to 8% on many food items including cereals and grains as the exemption under VAT is limited to unprocessed food. Consumer Price Index (CPI) would be up due to inflation of food products temporarily. Over 2000 items right from ‘salt to camphor ‘were scrutinised to arrive at the GST roll out on 1 July 2017.
As usual the ordinary people are the worst affected.

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Read more on the latest GST tax rates in India.


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Traders in the stock and other financial markets use technical analysis to make their trading decisions. Candlesticks patterns offer an excellent visual aid to the price movements in a certain period of time.

These patterns are formed through candle bodies, which are solid areas between the opening and closing prices and wicks representing the highs and lows. A solid candle may be formed when opening price is equal to the low and closing price is equal to the high. Thin candles, i.e. candles that have a small body and long wicks result due to price volatility that fluctuates a lot in a single trading session.

Candlestick charts include data for several timeframes in single pricing bars. That includes the opening price, the closing price, the high of the session, and the low of the session. Therefore, they are more beneficial for technical analysis of stocks in comparison to traditional line chart which just shows the closing prices.

With his book “Japanese Candlestick Charting Techniques”, Steve Nison introduced candlestick patterns to the Western countries in 1991. Several formations having colorful names, such as evening star, bearish dark cloud cover, and three black crows are identified by traders. Additionally, hammer and Doji patterns are used for long and short side trading strategies.

Reliability of candlestick patterns

Although there are a large number of such patterns, not all work well. Greater popularity of candlestick patterns has reduced their reliability because these have been deconstructed by the algorithms of the hedge funds. Such stock market players rely on quick executions when compared to traditional fund managers and small individual traders. Often individual traders and fund managers use complex strategies based on multiple technical charts and indicators that are found in popular texts.

Here are five patterns that perform well to help predict price momentum and direction. Each pattern works within surrounding price bars to predict high or low prices. In addition, these patterns are time-sensitive in two ways. Firstly, these perform within the limitations of charts under review, such as daily, weekly, or monthly. Secondly, the effectiveness quickly reduces by three to five bars after the completion of the pattern.

Five popular candlestick patterns

Candlestick patterns predict reversal and continuation. The reversal patterns predict modification in price direction. On the other hand, continuation patterns predict the extension in the current price movements.

1. Three line strike

This is a bullish reversal pattern that carves three black candles within a downward trend. Each bar shows a lower low and closes near to the intrabar low. The fourth bar shows an even lower opening but reverses in a wider range outer bar that closes higher than the first candle within the series. The opening print also marks the fourth bar low. According to the well-known investor Thomas Bulkowski, this reversal pattern is able to predict higher prices with an accuracy rate of almost 84%.

2. Two black gapping

This bearish two black gapping pattern is a continuation trend appearing post a notable top in an uptrend. It also shows a gap down yielding two black bars that post lower lows. This candlestick pattern is predictive of a decline that will continue to further lower lows and may trigger a broad scale downward trend. This pattern is able to predict lower prices with 68% accuracy.

3. Three black crows

Three black crows is a bearish reversal pattern beginning at or near the high during an upward trend. It shows three black bars that post lower lows that close near to the intrabar low. This candlestick pattern predicts a continued decline in the price reaching lower lows that may even result in broad scale downward trend. The most bearish pattern often begins at a new high because it often catches buyers that enter momentum plays. The accuracy of this pattern to predict low price trends is 78%.

4. Evening star

The bearish evening star trend is a reversal pattern beginning with a tall white bar carrying an upward trend to a new high. The market gaps higher on the next bars but fails to bring in new buyers. As a result, narrow range candlestick formations are created. A gap below the third bar completes the pattern and indicates a further decline to continue towards even lower lows. This may result in broader scale downward trend. This candlestick pattern is able to predict reduced prices with 72% accuracy.

5. Abandoned baby

This abandoned baby is a bullish reversal pattern appearing at the low of a downward trend. It is formed post a series of black candles print lower lows. The market gaps lower on the next bar but new buyers do not enter the market resulting in a narrow range Doji candlestick that opens and closes prints at the same price. The pattern is completed with a bullish gap on the third bar and predicts continued recovery to reach higher highs. This may result in a broader scale upward trend. Higher prices can be predicted using 70% accuracy using this pattern.

Candlestick patterns are used by market players as these provide continuation and reversal trend predictions. These patterns are beneficial as they offer early signals. Traders and investors who are able to understand these patterns may earn higher profits through stock market investing.


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The Food Safety and Standards Authority of India (FSSAI) was established to regulate food standards – everything from manufacture, storage, distribution, sale and import – and improve the country’s notoriously lax approach to food hygiene and adulteration.

As India’s top food safety authority, the FSSAI has the last word on what can be sold on store shelves. How it sets and enforces standards has been the subject of much debate in the scientific, health and business communities.

Recently, Union Minister of Food Processing Industries, Harsimrat Kaur Badal, called out the FSSAI’s rules and so-called inspector raj practices for being outdated, according to news reports.

As a relatively young body, FSSAI does not have standards for foods in all categories. It has taken steps to bring its food safety research and quality assurance up to international standards in terms of setting guidelines and best regulatory practices.

In the latest legal news, FSSAI announced a tied up with Decernis Ltd. to access a database of more than 70,000 global food standards and regulations. Decernis is a US-based provider of regulatory expertise and intelligence on food, consumer and industrial product safety.

This database contains standards for food additives, contaminants and other food products sourced from more than 170 countries. The body will offer training sessions for employees to better assess risk and compliance and generally bring Indian standards in line with international levels.

Impact on FMCG industry

The FSSAI and FMCG industry have clashed in the past over food quality and the authority’s power to levy fines and deny approval to products, most famously in 2015 over the temporary withdrawal and ban on Nestle India Ltd.’s Maggi noodles.

The body is working on new food labelling regulations for foods high in salt, sugar and trans fats, as well as defining junk food. To disincentivize the purchase of junk food, the authority has suggested banning junk food advertisements on entertainment targeting children.

It has proposed imposing a so-called fat tax on packaged and processed foods and sweetened drinks.

Not surprisingly, FMCG majors such as ITC Ltd., Nestle and Dabur Ltd. are up in arms over the idea, saying consumers who choose to spend extra for the pleasure of junk food will continue to do so. They say companies will have to pass on the cost of any tax to consumers and this will eventually hurt their bottom line.

But in recent share market news, a spokesperson for Hindustan Unilever Ltd. said the company supported the FSSAI’s attempts to promote safe and nutritious food and that FMCG companies had a responsibility to contribute to the cause.

While the question of food safety is viewed differently by the regulator and FMCG sector, the FSSAI has managed to secure co-operation from the industry on some issues.

To address prevalent malnutrition and undernutrition in India, the regulator ordered brands such as ITC, Patanjali Ayurved Ltd. and HUL to begin fortifying wheat flour with vitamin B-12, folic acid and iron. It also said all major edible oil manufacturers and processors will begin fortifying cooking oil with vitamins within the next few months.

Other FMCG companies such as Coca-Cola India Pvt. Ltd. and Mondelez India Foods Pvt. Ltd. have joined hands with the body to train street food vendors and provide safe food to underprivileged schools in Delhi, respectively.

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How Will GST Affect The Export Sector?

by Vinaya HS on June 1, 2017

in Finance

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The landmark goods and services tax (GST) is set to come into effect on July 1. For all the complexities in moving to the new framework, the application of a single tax regime is seen as a boon for economic growth and fiscal transparency.

GST will subsume indirect taxes currently imposed by the Centre, such as central excise duty, customs duties, service tax and certain cesses and surcharges.

At the state level, GST will absorb value-added tax (VAT), central sales tax, luxury tax, entry tax and entertainment tax, among others. Instead, central GST and state GST will replace these myriad indirect taxes.

Exports will remain zero-rated under GST’s five slabs. However, the export sector, especially small- and medium-sized firms, worries about what might come with this uncharted territory. In particular, they fear the new GST regime may limit the upfront exemptions that they have come to expect on export duties.

These incentives have helped Indian products remain competitive in foreign markets and subsequently contributed to economic growth. The Export Promotion Capital Goods scheme, for example, is for duty-free sourcing of machinery for export purposes, and the Advance Authorization Scheme allows duty-free sourcing of raw material.

GST latest news indicates that the GST Council has included a provision to keep the duty drawback on goods manufactured in India for export. It’s essentially a rebate on the tax charged on imported and domestic materials or services used to produce such goods.

If enacted, the effect of the duty drawback on export-dependent sectors, such as handicrafts, would be positive. Exporters who have paid tax on the inputs mentioned above, but whose products have no tax against them, will now be able to adjust these duties so their goods don’t become uncompetitive in global markets.

According to Commerce Minister Nirmala Sitharaman, the finance ministry will refund 90% of export duties paid during the manufacture of items for export. This will be done in a seven-day period under the new GST regime through an online portal. If for some reason, this seven-day deadline is not met, the government will pay interest to exporters at a rate of 6%.

In this sense, GST will be a boon for exporters. Duties must be paid at the time of the transaction, and refunds processed after export. The intervening gap had worried exporters because of the impact on their cash flow and working capital, and since tax authorities might take months to process refunds. Smaller export firms had demanding an exemption from paying any tax under GST on account of this delay.

Now, the process of claiming these drawbacks and refunds is easier through the high-tech, fast-track mode available online. Furthermore, once the GST IT network is integrated with the customs infrastructure, accessing drawbacks may become even more efficient.

On the downside, the government is reviewing the Foreign Trade Policy, which means some export incentives may be eliminated.

Industry experts also say GST implementation for the export sector could increase costs by 1.25%

For more legal news in India, visit BloombergQuint.


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In 2015, the Forward Markets Commission, the former commodities regulator, was merged into the national capital markets regulator, the Securities and Exchange Board of India (SEBI).

In April 2017, SEBI approved a proposal to integrate the spot and derivatives markets by introducing options trading in the commodities market.

Currently, SEBI only regulates derivative contracts in commodities. But in this year’s Union Budget, Finance Minister Arun Jaitley proposed that the spot market for commodities and the derivatives market be integrated.

The ministry had been consulting experts from SEBI and commodities markets and Jaitley said a committee would be formed to examine a new operational framework.

Technically, derivatives prices are supposed to be based on the prices of the underlying commodities that are traded in spot market. Experts believe the integration of spot and derivatives markets will improve regulatory control and increase transparency in spot trades and how they affect prices of futures contracts. SEBI is also counting on the reforms to increase volumes of exchange-traded commodity future contracts.

When commodities spot markets do come under SEBI’s purview through integration, the government plans tough regulations to avoid a calamity such as the USD 916 million dollar-fraud at the National Spot Exchange Ltd. (NSEL) in 2013.

The commodities exchange collapsed after it defaulted on payments to market participants and had to suspend trading.

Jaitley had proposed the integration saying farmers would benefit from reforms in the commodities market. Spot trading is largely the norm in wholesale markets or agricultural produce market committees, which means traders often outmaneuver farmers and miss out on profits.

In the latest legal news, the new SEBI Chair, Ajay Tyagi, has also said commodity markets are a priority for him so farmers and end-users gain. He noted that, aside from the Agricultural Produce Market Committee, which regulates agricultural products, most commodities in India are not regulated.

According to experts, integrating the spot and derivative markets could pose problems. While derivatives are standard contracts that have specific qualities and grades, the spot market allows several varieties, qualities and grades of the same commodities to be traded in the same market, with some regional variations.

Analysts also warn that volatility in the agricultural commodity market can have a rub off effect on economic policy.

As yet, there is no clarity on how the new framework will address agricultural and non-agricultural commodities.

For more on the stock market news, visit BloombergQuint.


What’s In Store For Aviation Stocks?

by Vinaya HS on May 14, 2017

in Finance

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Indians are flying more than ever, with domestic air passengers hitting 100 million, double what they were six years ago.

In the latest aviation news, shares of Indian carriers have been buoyed by data showing air traffic in the January-March quarter of 2017 grew 18.5% compared to the same quarter in 2016, led by IndiGo Airlines’ parent company InterGlobe Aviation Ltd.

Domestic airlines ferried more than 2.72 crore passengers in the quarter, with IndiGo flying almost 40% of passengers, and Jet Airways (India) Ltd. trailing at just under 18%.

These factors have given markets reason to cheer. This year, shares of InterGlobe Aviation, Jet Airways and SpiceJet Ltd. have all performed well, with the latter beating competitors in terms of gains and all three outperforming the S&P BSE 500.

There are a few reasons for this revival in aviation stocks.

For the last month, aviation turbine fuel (ATF) has been cheaper on account of global crude oil movements and foreign exchange rates. This is good news, at least until oil marketing companies review fuel prices.

Then there’s the perennial question of when Go Airlines (India) Ltd. will list its shares, which has kept investors restless for years. Plans for a GoAir IPO are believed to have been in the works since 2015, but owners the Wadia Group have kept markets waiting on the right time.

Recently, GoAir’s CEO hinted once again that he believes the time is right for an IPO. The company was among the first airlines to fly the new Airbus A320neo and has 144 of them on order.

The most recent IPO in the airline sector was InterGlobe Aviation, which raised Rs 3,000 crore in 2015. The company recently established a wholly-owned subsidiary for airport services that has yet to start operations. Jet Airways has made a similar move to set up its own airport services subsidiary.

So, will this market sentiment remain positive?

Lower oil prices over the last two fiscal years have helped propel most Indian carriers to profitability. However, the Brent crude average of USD 55 per barrel in the quarter ending March 2017 is much higher than the USD 35 a barrel in the same quarter of 2016, and this has already rattled airline executives.

For this reason, analysts are projecting a decrease in airline net profits for the March quarter on a year-on-year basis.

Yield management figures in the March quarter will also determine the performance of aviation stocks. While observers have pegged February and March yields as reasonable, IndiGo yields are expected to slide for the entire quarter. Edelweiss Securities Ltd. expects higher passenger volumes will be offset by fuel costs, which will hit the airline’s net profit.

Recent cues from the government indicate some good news may be in store for the airlines.

According to Minister of State for Civil Aviation Jayant Sinha, a blueprint for expanding terminal capacity at Delhi Airport is on the way, and passenger movement at Delhi Airport could increase from 60 million to around 90 million in the next few years.

Investors also warmed to news that Sinha has promised to speed up forest clearance for Navi Mumbai International Airport.

For more on stock market & business news in India, visit BloombergQuint.


Transfer Pricing 101

by Vinaya HS on May 14, 2017

in Finance

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One of the main difficulties facing foreign companies in India is the issue of transfer pricing. In the past, it’s cast a chill on investor sentiment and cemented India’s reputation as a land of inconsistent and unpredictable tax rules.

Foreign companies such as Vodafone Group, Cairn Energy and Royal Dutch Shell have been embroiled in litigation surrounding transfer pricing and retrospective application of taxes.

Not only has this delayed business plans in India due to anxiety about tax outcomes, it’s also given birth to a new catchphrase, “tax terrorism” – the sudden levy of massive retrospective tax bills on companies by overzealous authorities.

Several cases of “tax terrorism” have triggered a showdown between multinationals and Indian tax authorities, even scaring off foreign institutional investors who had been approached to pay retroactive tax by the Income Tax Department.

What is transfer pricing?

Transfer pricing refers to the pricing of transactions between related parties, such as a parent company and its subsidiary. Because the two parties are associated, the transaction may be priced differently than if it had been between two unrelated parties (known as the “arm’s length” principle).

The transfer pricing mechanism ensures that revenue is properly captured so all taxes due are accounted for, rather than evaded. The term refers to the calculation of profits made by multinationals and how they’ve shifted to the parent company.

In India, transfer pricing has also become a political issue, largely because of the negative impact it’s had on the ease of doing business for international companies and their Indian operations.

In 2012, the government introduced advance pricing agreements (APA) between taxpaying organizations and the Central Board of Direct Taxes (CBDT) that calculate taxes for future international transactions for a predetermined period.

APAs give companies and tax authorities the opportunity to negotiate a tax rate and avoid going to court later. They cover a five-year period and can be either multilateral, bilateral or unilateral.

What do transfer pricing and APAs mean for multinationals doing business in India?

In October 2014, the government introduced a “rollback provision” enabling retrospective application of APAs, thereby avoiding litigation over transfer pricing.

By agreeing on transfer pricing rates and methodology before transactions occur, it helps avoid disputes that can go on for years across multiple tribunals.

Vodafone, one of India’s largest telecom service providers, has borne the brunt of the government’s tax collecting efforts since acquiring Hutchison Essar Telecom services in 2007.

In 2015, the Bombay High Court sided with the telecom major, which had challenged the tax authorities’ demand to add USD 1.3 billion to the taxable income of one of its units. Vodafone has since been pursued for more than USD 2 billion in a separate capital gains tax case.

In the latest legal news, the CBDT released its first annual report on the APA programme in India, which revealed 815 applications had been filed in India since the programme was launched.

It showed that 42 applications for bilateral APAs since February 2016 have come from the US. The UK and Japan followed, with 39 and 17 bilateral applications received, respectively.

Of the 815 applications, the CBDT has entered into 152 agreements (141 unilateral), roughly half of which are with the IT and financial sectors.

While APAs are one outlet for foreign companies to avoid lengthy tax battles in India, they still have reason to be nervous. In April, tax authorities demanded Cairn Energy UK Ltd. pay USD 1.6 billion in interest on a USD 2.9 billion retrospective tax bill.

For more on business news, visit BloombergQuint.


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There are numerous examples of how easily Indians can lose whatever privacy they have through intentional or unwitting leaks of personal information.

Last year, financial data from up to 3.2 million debit cards were compromised in a leak affecting major banks such as State Bank of India, HDFC Bank, ICICI Bank and others.

Subsequently, more than 35,000 patients of a Mumbai-based diagnostic laboratory were victims of a data hack that saw their medical records – including test results – spilled online.

And the largest database of all has not been immune to careless handling of information either. In more than seven years, the Unique Identification Authority of India (UIDAI), the agency that collects biometric data used to issue Aadhaar cards, has stored information from more than one billion Indians.

According to the Centre for Internet and Society, the government itself has made public details of bank accounts and personal information of more than 130 million Aadhaar holders. The Centre has confirmed there was a leak, but denied the UIDAI was responsible, blaming other government agencies.

Recently, the government made it mandatory for Indians to have an Aadhaar card – in addition to their Permanent Account Number (PAN) – to file their tax returns, ostensibly to widen its taxpayer base and distribute welfare benefits more efficiently and accurately.

Activists have challenged this requirement in the Supreme Court. The challenge at hand is based on the necessity of Aadhaar card rather than concerns over data security, but critics warn the biometric system, which contains fingerprints and iris scans, can be used to steal identities and snoop on law-abiding citizens.

That’s because the UIDAI has contracted private companies, such as Microsoft, to provide authentication services and e-KYC requests.

This has amplified the lack of clear, thorough and overarching privacy protection laws in India.

According to the Aadhaar Act, 2016, it’s illegal to impersonate or knowingly duplicate Aadhaar data. However, enforcement and investigation are at the behest of the UIDAI, and punitive measures are unclear.

The involvement of corporate players, along with the overzealous application of Aadhaar – demands for its presentation have come from schools, hospitals and other non-government service providers – have advocates and cyberlaw experts raising the spectre of a lawless digital frontier.

In recent legal news, Attorney-General Mukul Rohatgi said the Centre is considering a data protection regime, possibly by Diwali.

But even while fending off accusations that Aadhaar is a covert surveillance tool, the Centre has told the Supreme Court that Indians do not, in fact, have “absolute” right over their bodies and cannot refuse to provide biometric samples.

The Information Technology Act contains a few sections on how corporations should handle sensitive personal data. Beyond those sections, there is no legal framework that safeguards Indians’ digital privacy and security: laws that address consent, duration, which data are private or public, how they should be obtained and stored and the nature of reparations for misuse are absent.

With the onset of digital payments, the move toward a cashless society and the popularity of social media, cyberlaw activists are pushing India adopt a more sophisticated data privacy statute. Globally, governments have recognized that technology is not infallible and have backed this up with legislation that governs the use and storage of personal data and punishes violators.

The former chair of the UIDAI, Nandan Nilekani, has also spoken in favour of stronger privacy laws not only to protect personal information, but also to improve digital literacy.

For the latest business news, visit BloombergQuint.


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The Burden of Debt is not one that everyone can handle well. For some, it is the idea that you have to pay more than what you borrowed with steep interest rates and finance charges. With multiple offers on credit cards and other means of financing, it is tempting to acquire things on credit. It seems hassle-free to lead a life without any debt. But realistically speaking, that’s not always possible.

Everyone knows that missing a credit card payment can land you into a soup. Missing credit card payments is one of the cardinal sins of personal finance. While most are able to make timely payments owing to the fear of late fees & penalties, every now and then an unforeseen expense comes along and wrecks your finances. If credit card bills and other expenses are piling up weighing you down, it may not be such a great idea to let your credit card hurt your finances. It may be time to prepare a debt consolidation strategy with a Personal Loan – rather than pay the exorbitant interest rates on missed credit card payments.

People also like to maintain a certain lifestyle and this usually entails spending on different things. So, avoiding consumption altogether is not always possible. However, by intelligently managing your expenses, you can live the life you want and pay for it on a timely basis. This is where a personal loan comes in. You can avail a personal loan to consolidate your debt.

A debt consolidation strategy implies merging separate loans into one single loan. This also includes loans taken from different financial institutions and on credit cards. You can simply refinance all outstanding loans with a new loan from a single institution. The advantages of this are that you get to pay a uniform rate of interest on all the loans on a single day. This is especially beneficial for those running high credit card dues. That’s because there the rates can be more than 40% per annum.

Using a personal loan to your advantage and make regular payments while paying a predetermined equated monthly installment could be the answer to your financial woes. The jury is always out on how to best manage your personal expenses. While some believe that taking on external debt in the form of a loan should best be avoided when it comes to paying your personal expenses, the views are changing.

A Personal Loan can be used for multiple purposes. Getting a sanction for these loans is easy as well. Lenders look at the applicant’s credit score, income, and repayment capacity. Unsecured Personal Loans usually come with higher interest rates. But with collateral, you can avail reduced rates.


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The 2017 fiscal year was a stellar one for midcap stocks, which continued their outperformance of benchmark indices: consider the 35% positive returns from midcaps in FY ‘17, compared to the Nifty’s 19%.

According to a Motilal Oswal report, investors who bet on midcap stocks over the last five years have been rewarded – they outperformed the Nifty by 50%

While blue chip and tech stocks dominate market news in India, smaller, lower-profile players have been catching analysts’ eyes.

In particular, midcap pharma stocks have done better than midcap IT stocks. Despite the perpetual risk of Indian pharma coming under the US Food and Drug Administration (FDA) scanner, observers expect domestic companies to receive regulatory approvals within the next few months – a fillip for the overall sector.

The growth opportunities for the domestic pharma industry lie in lifestyle and environmental factors that will require increased spending on drugs and medicinal products.

Here’s a look at some midcap pharma stocks singled out by analysts:

Ajanta Pharma Ltd.

Ajanta Pharma specializes in finished dosages, with a focus on cardiology, ophthalmology and dermatology. Between 2011 and 2016, it witnessed a CAGR of 30% in domestic formulations sales, vs. a 14-15% industry CAGR.

Motilal Oswal has highlighted new products and a steady flow of abbreviated new drug applications (ANDA) as reasons to watch the company.

While Ajanta’s US business is still nascent compared to other midcap pharma companies, its FY ‘17 projected US revenues are Rs 190 crore. The company is also growing Asia and Africa, where it is a leader in anti-malaria formulas.

Laurus Labs Ltd.

Laurus Labs, which is in the business of manufacturing active pharmaceutical ingredients (APIs), only listed its shares in December after registering annual growth of 41% (CAGR) between 2012 and 2016.

The firm’s operations are export-heavy – only around 20% of revenues are from the domestic market, which includes clients such as Cipla, Natco and Mylan. Some analysts have questioned the company’s dependence on a few big-name customers.

Recently, the Government Pension Fund of Norway sold more than 5.67 lakhs shares in Laurus. The company’s founder and CEO expects the return ratio to be above 20% once its formulations start generating revenue.

Vivimed Labs Ltd.

Vivimed Labs is another midcap pharma player with a steady stream of exports and MNC clients. It manufactures APIs, formulations, specialty chemicals and pharmaceuticals and has passed FDA inspections of its plants in Spain, Mexico and India.

The firm saw heightened investor action after it declared a consolidated net profit of Rs 51.71 crore for the quarter ending December 2016 – a 125% year over year increase. This was also on the back of a 74.29% sales increase.

For more business news, visit BloombergQuint.


The Future of FMCG Stocks

by Vinaya HS on May 9, 2017

in Finance

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FMCG stocks rose after the Indian Meteorological Department (IMD) forecast a normal monsoon, which is seen as a bellwether of rural demand and consumption.

All FMCG majors saw an immediate drop in rural demand for consumer non-durables after demonetization.

But even prior to the latest Indian market news based on the IMD’s announcement, the sector has been witnessing a bit of an upswing to tame a slowdown.

Established FMCG stocks, such as Godrej Consumer Products, Hindustan Unilever, Marico, ITC and Colgate-Palmolive, have long been the darlings of seasoned investors for their consistent margins and earnings. But the entry of Patanjali’s products, with its brand loyalty and novelty factor, surprised many industry veterans.

An increase in raw material costs has also resulted in higher prices for some FMCG staples, such as biscuits and soap.

FMCG’s growth rate has historically been 1.2 times nominal GDP. This number has come down to 0.8 times since FY ‘13, according to a recent report from CII and Bain & Company. Experts say e-commerce has made only a dent in this figure, and companies have simultaneously lowered their investments in marketing, promotions and new product launches during the same period.

However, over the last three months, the BSE FMCG and Nifty FMCG indices have beat the Sensex and Nifty by 2% to 3%. FMCG funds have subsequently returned 16.5%. Zoom out and the trend becomes even more apparent: over a five-year period, FMCG funds have delivered a 18% return.

What explains these metrics?

Between FY ‘13 and FY ‘16, the government made efforts to stimulate rural demand: spending on initiatives such as MGNREGA has coincided with the sluggish FMCG rate of growth to GDP.

Although rural agricultural incomes increased in the third quarter of FY ‘17, on average, by more than 8% year-over-year, this year’s Union Budget provided a 1 lakh crore increase to the agricultural credit target. FMCG stocks read this as a sign that rural consumption would soon pick up.

The CII and Bain & Company report noted there’s significant room for FMCG to grow in the next five to 10 years – anywhere from 9% to 17%, depending on the nominal GDP growth rate. Last year, it grew at 9% until the third quarter, with rural growth outpacing urban growth 1.7 times. Food led the way, with 10% growth, mostly due to volumes.

Observers expect GST, set for introduction on July 1, will also benefit the FMCG sector with its uniform national sales tax making pan-India administration simpler.

In such a fiercely competitive sector, brands must continuously evolve to perform and win some recall among consumers.

Analysts say with FMCG, the bottom line for investors will always be corporate performance, rather than bandwagon buying and selling led by irrational market exuberance.

For more business news in India, visit BloombergQuint.


The Future of Oil and Gas Stocks

by Vinaya HS on May 9, 2017

in Finance

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Crude oil prices are now roughly half of what they were when Narendra Modi came into power in 2014. The odds of returning to USD 90-100 a barrel any time soon look slim, even after oil producers – both OPEC and non-OPEC – agreed to cut oil output late in 2016.

Observers have given a margin of USD 40-70 for crude oil prices by the end of the year. This wide range reflects an era of volatility – neverending geopolitical turmoil in major oil producing nations, plus the increase in US shale oil drilling, part of the Trump administration’s “America first” energy policy.

The impact on India is multifold. India currently imports more than 80% of its crude oil and 40% of its natural gas. According to S&P Global Platts, with the country’s ever-increasing oil demands, this number is unlikely to reduce. Indian oil firms seem to have taken note: Oil and Natural Gas Corp. Ltd. (ONGC) has five projects worth USD 1.1 billion in the pipeline to raise domestic production.

In the same three-year period that’s seen the election of Modi and the collapse of crude oil prices, the S&P BSE Oil and Gas Index has gained more than 50%. Oil marketing and downstream companies such as Bharat Petroleum Corp. Ltd., Indian Oil Corp. Ltd. and Hindustan Petroleum Corp. Ltd. have also witnessed a threefold surge in share price, along with gas distributors and importers. Their peers, however, such as ONGC and Oil India Ltd. have underperformed.

Of late, Indian oil and gas marketing companies have turned their attention to local pricing: oil and gas stocks rose after reports that state-run oil firms have met government officials to consider dynamic fuel pricing.

The introduction of daily price revisions would bring India on par with international retail fuel markets and influence private oil and gas players to adopt the system. Stocks of IOC, Bharat Petroleum and Hindustan Petroleum, which represent more than 90% of India’s retail fuel market, all rose on this Indian stock market news. If companies do enact dynamic pricing, oil companies’ retail prices will better reflect crude movement and impact their overall margins positively.

Markets may react less favourably to upcoming quarterly results from oil and gas majors. According to data from BloombergQuint, seven oil and gas firms, including GAIL India Ltd. and Reliance Industries Ltd., are expected to show an aggregate decline in revenue for the January to March quarter, compared to the preceding quarter.

The flat net profit and sluggish earnings are on account of weak refining margins, fluctuations in crude and product prices and slower growth in domestic fuel consumption in the quarter.

While benchmark Brent crude averaged USD 54.6 a barrel in the January to March quarter – a 7% increase from the October to December quarter – experts expect this summer’s heavy driving season to help boost oil and gas prices, and as a consequence, explorers.

Looking ahead to how the movement of crude prices will affect India, if it remains under USD 60 a barrel, analysts expect markets to hold steady long term. Above that, consumers will feel the brunt of inflation and the government’s subsidy targets and budget estimates will be thrown into disarray.

Most estimates of crude prices hover on the low end for now, meaning consumers, investors and oil and gas firms may be in for a mixed financial bag.

For more of the latest business news, visit BloombergQuint.