Jewellers at some places are still on strike against the increase in duties in the Budget 2012-13. However, some industry experts feel that since the market and consumers have adjusted with the hike, there is no need to continue with the strike
The three-day strike of the jewellery industry has now become an indefinite strike in certain areas. The jewellers are protesting against the Budget proposals announced by the finance minister which they claim will make buying gold and silver dearer for the consumer.
To control the current account deficit (CAD) partly caused by the imports of gold and other precious metals in the first three quarters of this fiscal, the finance minister has proposed additional duties to limit the imports of gold and silver. Finance minister Pranab Mukherjee has proposed to increase import duty on gold to 4%, increase excise duty on branded and non-branded jewellery by 1%, 2% tax on cash sales of over Rs2 lakh, while removing the 1% excise duty on branded silver jewellery.
According to the Gem & Jewellery Export Promotion Council (GJEPC) this has put the entire jewellery industry of India and the 3.5 million people it directly employs under great uncertainty. The jewellers are demanding a roll back of excise duty. The jewellers are alleging that jewellery will out of reach for the aam admi. The new measures will encourage black market or smuggling. Jewellers are alleging that too much of unnecessary paper work would be involved.
“The strike is against the announcements, such as increase in custom duties, imposing excise duty, made in the recent Union Budget. All the jewellers are united to fight and safeguard the interest of the customers who cannot fight with the government. For instance before the Budget, for buying one kilogram of gold one had to pay duties of around Rs80,000-Rsd90,000. But after budget it rose to whopping Rs1.7 lakh. The jewellers will pass on this additional cost to the customer. But the buyers have to shell out extra money. Because of this we expect the imports to come down significantly” says Karan Vasa, associate vice president, RiddiSiddhi Bullions Ltd.
However, some people feel that after the Budget the market has adjusted to the prices by passing the hike on to consumers and there is no need for the strike. Mukul Sonawala, former president of the Bombay Bullions Association, said, “In my view such strike is not required. Post budgetary announcements, the prices have been adjusted in the local market. Retailers and wholesalers will pass on the cost to the customers. But the cost itself comes to just 0.3% which the customers will bear. In my view that (the increase in cost) is little. People who want to buy gold will buy in any case.”
Measures announced in Budget 2012-13:
According to the Standard Chartered Bank report, to meet the expectations of the Asian affluent, banks need brand reputation, service and advisory process
Despite a slight dip in short-term wealth confidence due to an uncertain economic landscape, affluent Asians remain confident in growing their wealth - they have an aggressive wealth target of growing their wealth to $4 million in 10 years. This means they need an annual return of 12%. This is according to The Future Priority Report: a study conducted from October to November 2011 by Standard Chartered Bank and Scorpio Partnership which captures sentiment of over 2,700 Asian affluent individuals across nine markets.
The report also reveals that while most respondents see Asia as the region offering excellent wealth creation opportunities, in the longer term they adopt a more international perspective. Further, Asian affluent are sophisticated wealth builders, adopting a dual-prong approach of investing, and using credit or leverage to enhance their returns.
According to the report, wealth is created through a balance of investing and managing debt. To meet the expectations of the Asian affluent, three factors stand out in importance for banks namely brand reputation, service and advisory process. There are three themes which will grow in importance in the future for banks namely education, internet and advice.
Wealth confidence is a defining characteristic of the affluent and a strong majority of Asia’s affluent (77%) remain confident in growing their wealth in the next 12 months, although the confidence level is slightly lower than that of the previous year (81%). Of the nine countries surveyed, India and Indonesia stand out as being the most confident (88% and 98% respectively), while Singapore, Hong Kong and Taiwan share similar levels of wealth confidence at 70%, 68% and 67% respectively.
Foo Mee Har, global head of priority and international banking, Standard Chartered Bank, said: “Customers, not banks, are driving the agenda in Asia. The Asian affluent are clearly wealthier and more sophisticated than before. They have distinctive and more complex needs and hence cannot be treated with a ‘one size fits all’ approach. Therefore, to succeed in this important client segment, banks need to focus more on their service and quality of their advisory processes, rather on the products they sell. Assuming the role of a trusted advisor also means really listening to what the client is asking for, and treating them in a holistic manner to include their families, their business and their global ambitions.”
From fake marriage parties to carrying money in ambulances, politicians are always one step ahead of election officials
“Despite taking preventive measures, black money and unregulated money flow continues to be a biggest hurdle in the way of free and fair elections in India,” said Dr SY Quraishi, India’s Chief Election Commissioner (CEC). He was speaking at a seminar titled “Democracy at Crossroads—Need for Electoral Reforms”, organised by Moneylife Foundation and V Citizens Action Network (VCAN).
Dr Quraishi said, “It is common knowledge that black money is used in elections. In private conversations, after elections when we (Election Commission) cannot do any more harm, politicians tell us what they really spent. We do everything we can do to catch them. We keep track on the money flow and had seized crores of rupees during elections in the past. It does act as a deterrent. But they are always ahead of us and find some new modus operandi to circulate money.”
He gave interesting anecdotes about many ways candidates bribe voters, which in reality is an electoral crime. For instance, in one case, a marriage party was arranged by a candidate during election time. “Ironically, when one of our officers casually walked in that wedding there was neither bride nor bridegroom. On the contrary, a crowd of more than 1,000 people were enjoying the meal and drinks,” explained Dr Quraishi.
Another new technique of supplying money to the voters is by using ambulance and funeral vans. Dr Quraishi said, “Earlier money was easily transferred to the voters using cars. It was hidden in all possible parts of the car. But after our raids, they started using ambulances and funeral vehicles. We had received many complaints regarding the same, but checking these vehicles is a task. We cannot stop an ambulance on mere suspicion and run the risk of a genuine patient being affected. So our solution is to follow the ambulance and then check it the moment it reaches the hospital. This amounts to spending more time as well as money.”
According to the EC, the issue of black money used in election campaigning led to a debate if there is a need to increase the limit on the campaigning expenditure of each candidate. “People told us that the ceiling actually forces candidates to cheat. So we requested the law ministry to increase it. Accordingly, we increased it Rs16 lakh from the Rs10 lakh cap followed till last year in case of Vidhan Sabha elections, and to Rs40 lakh from 25 lakh in case of Lok Sabha elections. We considered 16 years of inflation,” said Dr Quraishi.
However, he added, “When we analysed the returns filed by these candidates, after elections we found that the average spending was Rs8 lakh. Now why would it be so low despite having Rs16 lakh as legal limit? …Because it is black money that has been used. White money is anyways not used. This is our concern.”
Dr Quraishi told that the efforts taken up EC to keep track on the money flow has yielded some results. “MPs (Members of Parliament) and MLAs (Members of Legislative Assemblies) tell us that this has encouraged them to manage with less money. Even our analysis shows that crime and money in election is a competitive phenomena. If one party puts a candidate with criminal background, another party will put candidate having more criminal cases. While we strive to curb the money power menace, somebody has to take a lead to break this competitive attitude.”