<p>Stocks across the world are in a funk and how!&nbsp;<br />
&nbsp;</p>

<p>And your take your pick on who to blame it on: Rising US wages; India&#39;s Finance Minister Arun Jaitley introducing the long-term capital gains tax on equities; Foreign investors finding valuations a trifle too high or just plain old profit booking after a significant event ends (India&#39;s annual budget).</p>

<p>&nbsp;</p>

<p>It was Black Monday today after India&#39;s benchmark Nifty Index plunged 5.7 percent or 378 points to a 7-week low in early deals. Panic was strewn across Asian markets in the morning after the US Dow Index dropped 4.5 percent, overnight, on news that US salaries rose by the highest since 2009. That means inflation is likely to raise its head in America and that may prompt the U.S. Federal Reserve to hike interest rates more aggressively. Rising interest costs mean that companies&#39; earnings may be at risk, and that triggered an across-the-board sell-off in equities.</p>

<p>&nbsp;</p>

<p>So, what should you be doing? Kahani abhi baaki hai, mere dost! Read on:</p>

<p>&nbsp;</p>

<p>The selling contagion landed on Indian shores today, in a market that barely fell for 4 days between Dec 1st, 2017 and Jan 31st, 2018. A total of 42 sessions saw the Nifty surge 9 percent. These kind of gains are rare and need to be pocketed.</p>

<p>&nbsp;</p>

<p>Therefore, Monday&#39;s sell-off has to be seen against this background. This unreasonable jump in equity prices, driven by robust liquidity and in a broad absence of strong earnings growth, had to moderated. The sell-off on Wall Street provided just that.</p>

<p>&nbsp;</p>

<p>As a consequence, the Nifty dropped 1.6 percent, or 168 points, to 10,498 points. All 35 sector and broad market indices ended lower between 1.5- 3.2 percent. Stocks are down for the sixth day in a row on disappointments related to the budget. The Sensex, too, shed 561 points at 34,195.</p>

<p>&nbsp;</p>

<p>I believe the selling is here to stay for a while as the fluff still remains in large parts of the market. Sustained buoyancy and optimism had seen the Nifty, the mid cap and the small cap indices surging between 29-40 percent during 2017 as thousands of crores of rupees poured into systematic investment plans of mutual funds every month.</p>

<p>&nbsp;</p>

<p>Nimble traders and savvy investors, therefore, were looking for a reason to sell and that came in the reintroduction of Long Term Capital Gains Tax of 10 percent deployed on sales of shares held for more than one year. Some investors also found the budget math awry and pressed sales on front line stocks. There are chances that the market may settle down in the 10,000-10,400 range for next month or so as investors rework their excel sheets on earnings expectations.&nbsp;</p>

<p>&nbsp;</p>

<p>So, how should you tackle this volatility?&nbsp;</p>

<p>&nbsp;</p>

<p>1. Uncertainty is here to stay till clarifications emerge on how the Long Term Capital Gains Tax is implemented. From the face of it, the tax does not allow indexation of purchases and that is a dampener. I see more steam coming out of the market as investors take profit away from the table ahead of April 1, when the new budget proposals come into effect.</p>

<p>&nbsp;</p>

<p>2. If you are a long term investor and you have your SIPs in place with good quality equity diversified funds, DO NOTHING. Relax, India&#39;s growth story in not dented. Just wait for the volatility to pass away and stick to your investment philosophy of buying stocks each month. Brave investors can put in an extra SIP this month to average costs lower.&nbsp;</p>

<p>&nbsp;</p>

<p>3. If you haven&#39;t started investing, this is the right time. Buy a simple equity diversified fund and put in a SIP. Choose the Direct route and don&#39;t go through an advisor. Contact the asset management company directly. It takes less than 5 minutes and the returns, or 10 years, are far higher. Trust me.</p>

<p>&nbsp;</p>

<p>4. If you are a trader, then I hope The Good Lord is with you!</p>

<p>&nbsp;</p>

<p><em>(Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL)</em>&nbsp;&nbsp;</p>


Uncertainty is here to stay till clarifications emerge on how the Long Term Capital Gains Tax is implemented.

Stocks across the world are in a funk and how! And your take your pick on who to blame it on: Rising US wages; India's Finance Minister Arun Jaitley introducing the long-term capital gains tax on equities; Foreign investors finding valuations a trifle too high or just plain old profit booking after a significant event ends (India's annual budget). It was Black Monday today after India's benchmark Nifty Index plunged 5.7 percent or 378 points to a 7-week low in early deals. Panic was strewn across Asian markets in the morning after the US Dow Index dropped 4.5 percent, overnight, on news that US salaries rose by the highest since 2009. That means inflation is likely to raise its head in America and that may prompt the U.S. Federal Reserve to hike interest rates more aggressively. Rising interest costs mean that companies' earnings may be at risk, and that triggered an across-the-board sell-off in equities. So, what should you be doing? Kahani abhi baaki hai, mere dost! Read on: The selling contagion landed on Indian shores today, in a market that barely fell for 4 days between Dec 1st, 2017 and Jan 31st, 2018. A total of 42 sessions saw the Nifty surge 9 percent. These kind of gains are rare and need to be pocketed. Therefore, Monday's sell-off has to be seen against this background. This unreasonable jump in equity prices, driven by robust liquidity and in a broad absence of strong earnings growth, had to moderated. The sell-off on Wall Street provided just that. As a consequence, the Nifty dropped 1.6 percent, or 168 points, to 10,498 points. All 35 sector and broad market indices ended lower between 1.5- 3.2 percent. Stocks are down for the sixth day in a row on disappointments related to the budget. The Sensex, too, shed 561 points at 34,195. I believe the selling is here to stay for a while as the fluff still remains in large parts of the market. Sustained buoyancy and optimism had seen the Nifty, the mid cap and the small cap indices surging between 29-40 percent during 2017 as thousands of crores of rupees poured into systematic investment plans of mutual funds every month. Nimble traders and savvy investors, therefore, were looking for a reason to sell and that came in the reintroduction of Long Term Capital Gains Tax of 10 percent deployed on sales of shares held for more than one year. Some investors also found the budget math awry and pressed sales on front line stocks. There are chances that the market may settle down in the 10,000-10,400 range for next month or so as investors rework their excel sheets on earnings expectations. So, how should you tackle this volatility? 1. Uncertainty is here to stay till clarifications emerge on how the Long Term Capital Gains Tax is implemented. From the face of it, the tax does not allow indexation of purchases and that is a dampener. I see more steam coming out of the market as investors take profit away from the table ahead of April 1, when the new budget proposals come into effect. 2. If you are a long term investor and you have your SIPs in place with good quality equity diversified funds, DO NOTHING. Relax, India's growth story in not dented. Just wait for the volatility to pass away and stick to your investment philosophy of buying stocks each month. Brave investors can put in an extra SIP this month to average costs lower. 3. If you haven't started investing, this is the right time. Buy a simple equity diversified fund and put in a SIP. Choose the Direct route and don't go through an advisor. Contact the asset management company directly. It takes less than 5 minutes and the returns, or 10 years, are far higher. Trust me. 4. If you are a trader, then I hope The Good Lord is with you! (Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL)

Opinion: What causes the downward spiral of India's stock market

<p>Stocks are on a roll, and how! The Sensex and the Nifty are hitting fresh records each day for reasons both fundamental and speculative. However, this is the time for new investors to be very, very cautious. Time and again -- during 1998/99 and 2007/2008 -- investors who entered a red-hot market with the intention of making a quick buck ended up burning their life&#39;s savings.&nbsp;</p>

<p>So, can you still join this party? Read on!&nbsp;</p>

<p>While equities remain the way forward for long-term savers, the path to be taken is fraught with hurdles. Both the Sensex and Nifty are hitting new records on heavy liquidity in the system, a shift towards investing in equities versus other assets coupled with positive announcements from the government. Savvier investors, who have experienced this kinetic upward thrust, are using every rally to partially book profit and move to cash.&nbsp;</p>

<p>Traders and new investors are, however, ignoring massive headwinds that the market is facing. Among them:&nbsp;</p>

<p>1. Tepid earnings from frontline stocks.&nbsp;</p>

<p>2. Global oil prices moving up to a 3-year high.&nbsp;</p>

<p>3. Major indices moving into the `expensive&#39; zone based on price-earning ratios. Thousands of crores of rupees moving into a select few stocks and pushing their prices to stratospheric levels.&nbsp;</p>

<p>4. The so-called penny stocks - which have dodgy managements -- have surged sharply as newbie investors bought into their `relative low prices&#39; in a bid to ride the bull-run.&nbsp;</p>

<p>5. Rising inflation and consequently little or no chance of interest rates moving lower.</p>

<p>6. Foreign ownership of frontline stocks reducing in favour of domestic institutions. Although, this is not a bad thing in the longer run. Ideally, Indian portfolio investors should have higher stakes in bluechip companies compared with overseas investors.</p>

<p>7. The demand for virtual assets like cryptocurrencies, which are purely speculative and have no underlying economic rationale, has shot through the roof. The bubble seems to have seen a mild puncture there.&nbsp;</p>

<p>8. The banking NPA problem is far from over.</p>

<p>9. Lastly and, most importantly, celebrations of the market hitting record levels are seen everywhere. They are on the front page of every newspaper, financial website. Talk about what to invest in and what to buy is dominating drawing rooms and everyone wants to get his/her financial portfolio checked with a so-called expert to see if s/he hasn&#39;t `missed&#39; the rally. I myself get several calls a day.</p>

<p>So, if things are so bad, why are the markets rising the way they are? What prompts a 1,000-point increase in the Sensex to beyond 35,000 in less than 16 sessions?</p>

<p>Well, here are the things that are going well for our markets:</p>

<p>1. There is a larger shift towards financial assets as savers move money away from fixed deposits, real estate and gold purchases. This rising tide of liquidity into the market is propelling prices and valuations higher. In the longer term, this is the best thing that is happening. Equity ownership is a minuscule 2 percent in India.&nbsp;</p>

<p>2. Investors believe eventually the economic steps being taken by Prime Minister Narendra Modi will bear fruit even if they deliver short term pain.</p>

<p>3. The advent of Goods and Services Tax will change the business landscape of India, delivering a tax bonanza for the government.</p>

<p>4.&nbsp; Top flight Indian companies are among the very best in the world when it comes to financial prudence, marketing skills and a deep management bandwidth.</p>

<p>5. While Indian markets themselves may be on shaky ground, they are among the top tier globally: to borrow a phrase from traders: India is a good girl on a bad street!&nbsp;</p>

<p>So, coming back to the moot point: how should you make money without burning your fingers? Well, here is a prudent financial plan:</p>

<p>1. Don&#39;t buy individual stocks. Chances of a strong correction are high and that could wipe out 20 percent of your capital in a very short while.</p>

<p>2. Buy a simple equity diversified fund. Do not go in for a sectoral fund.</p>

<p>3. Invest piecemeal: go in for monthly investments in an equity fund. Start a SIP.</p>

<p>4. Don&#39;t invest through a bank or an advisor. Their cut will reduce your overall earnings.</p>

<p>5. Choose the direct route of approaching a fund&#39;s website and go for the &#39;growth option&#39; in an equity diversified fund.</p>

<p>6. Lastly, have modest expectations for return: we are already in the 7th year of this bull run.</p>

<p>&nbsp;</p>

<p><em>(Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL)</em>&nbsp;&nbsp;</p>


Time and again -- during 1998/99 and 2007/2008 -- investors who entered a red-hot market with the intention of making a quick buck ended up burning their life's savings.

Stocks are on a roll, and how! The Sensex and the Nifty are hitting fresh records each day for reasons both fundamental and speculative. However, this is the time for new investors to be very, very cautious. Time and again -- during 1998/99 and 2007/2008 -- investors who entered a red-hot market with the intention of making a quick buck ended up burning their life's savings. So, can you still join this party? Read on! While equities remain the way forward for long-term savers, the path to be taken is fraught with hurdles. Both the Sensex and Nifty are hitting new records on heavy liquidity in the system, a shift towards investing in equities versus other assets coupled with positive announcements from the government. Savvier investors, who have experienced this kinetic upward thrust, are using every rally to partially book profit and move to cash. Traders and new investors are, however, ignoring massive headwinds that the market is facing. Among them: 1. Tepid earnings from frontline stocks. 2. Global oil prices moving up to a 3-year high. 3. Major indices moving into the `expensive' zone based on price-earning ratios. Thousands of crores of rupees moving into a select few stocks and pushing their prices to stratospheric levels. 4. The so-called penny stocks - which have dodgy managements -- have surged sharply as newbie investors bought into their `relative low prices' in a bid to ride the bull-run. 5. Rising inflation and consequently little or no chance of interest rates moving lower. 6. Foreign ownership of frontline stocks reducing in favour of domestic institutions. Although, this is not a bad thing in the longer run. Ideally, Indian portfolio investors should have higher stakes in bluechip companies compared with overseas investors. 7. The demand for virtual assets like cryptocurrencies, which are purely speculative and have no underlying economic rationale, has shot through the roof. The bubble seems to have seen a mild puncture there. 8. The banking NPA problem is far from over. 9. Lastly and, most importantly, celebrations of the market hitting record levels are seen everywhere. They are on the front page of every newspaper, financial website. Talk about what to invest in and what to buy is dominating drawing rooms and everyone wants to get his/her financial portfolio checked with a so-called expert to see if s/he hasn't `missed' the rally. I myself get several calls a day. So, if things are so bad, why are the markets rising the way they are? What prompts a 1,000-point increase in the Sensex to beyond 35,000 in less than 16 sessions? Well, here are the things that are going well for our markets: 1. There is a larger shift towards financial assets as savers move money away from fixed deposits, real estate and gold purchases. This rising tide of liquidity into the market is propelling prices and valuations higher. In the longer term, this is the best thing that is happening. Equity ownership is a minuscule 2 percent in India. 2. Investors believe eventually the economic steps being taken by Prime Minister Narendra Modi will bear fruit even if they deliver short term pain. 3. The advent of Goods and Services Tax will change the business landscape of India, delivering a tax bonanza for the government. 4. Top flight Indian companies are among the very best in the world when it comes to financial prudence, marketing skills and a deep management bandwidth. 5. While Indian markets themselves may be on shaky ground, they are among the top tier globally: to borrow a phrase from traders: India is a good girl on a bad street! So, coming back to the moot point: how should you make money without burning your fingers? Well, here is a prudent financial plan: 1. Don't buy individual stocks. Chances of a strong correction are high and that could wipe out 20 percent of your capital in a very short while. 2. Buy a simple equity diversified fund. Do not go in for a sectoral fund. 3. Invest piecemeal: go in for monthly investments in an equity fund. Start a SIP. 4. Don't invest through a bank or an advisor. Their cut will reduce your overall earnings. 5. Choose the direct route of approaching a fund's website and go for the 'growth option' in an equity diversified fund. 6. Lastly, have modest expectations for return: we are already in the 7th year of this bull run. (Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL)

Opinion: Beware! Stocks at a new high, so is risk

<p>Teary-eyed commentators have already beaten their chests hollow on how the twin curses of Demonetisation and implementation of the Goods &amp; Services Tax have slowed India&#39;s economic engine to a mere 5.7 per cent expansion. The Opposition has already gone for the government&#39;s jugular for these two apparent self-goals and everyone on Dalal Street is anxious to know whether the ongoing bull market in stock prices will continue or not.&nbsp;</p>

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<h5>The economy is in a temporary trough and just paused a bit in a bid to accelerate further.</h5>
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<p>So, what really happened and what is in store for India&#39;s economy, arguably the finest that is there in the global space as of now. Well, some of the brightest are missing the fine print: the economy is in a temporary trough and just paused a bit in a bid to accelerate further. It&#39;s the proverbial arrow that is pulled back on the bow before it hits the Bulls Eye.</p>

<p>Often, when all the chips are down, it is Bollywood that saves the day: Therefore, &quot;Picture abhi baaki hai, mere dost&quot;! Such is the resilience of the Indian economy that it will ensure growth returns in leaps and bounds. And there are enough economic indicators that are pointing to it.</p>

<p>True, second quarter GDP slowed to 5.7 per cent as companies cleaned up inventories and refused to manufacture on a large scale as the newly minted GST came into effect on July 1st. Since tax rates were to change largely<strong> </strong>for the better, sensible manufacturers thought it best to pause their production units for a while. That is the reason why you see manufacturing slowing to just 1.2 per cent growth during April-June versus 5.3 per cent in January-March.</p>

<p>There are two parts of the story: the reasons why GDP expansion slowed to its lowest since October 2014 are heavy interest burden on leading corporates owing to large borrowings; an appreciating rupee that has hit exports and, in turn, lowered capacity utilisation and banks that are under severe stress and are unable to lend due to ballooning non-performing assets.&nbsp;</p>

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<h5>The manufacturing PMI index for August, one of the most important measures to track economic expansion, is at 51.2, indicating that the underlying GDP is alive, well and, in fact, growing.</h5>
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<p>These factors have more or less stalled investments in capacity expansion. Therefore, growth slowed on the industrial side. A booming agricultural production also ensured that food prices at the farm level fell, thereby, resulting in agricultural growth slowing as well in the months of April to June.</p>

<p>In any case, most economists had more or less written off two-quarters of GDP expansion post-November 2016, when the government introduced demonetisation by sucking out 86 per cent of the currency float.&nbsp;</p>

<p>Now, look at how high-frequency economic indicators, such as monthly sales of motorcycles, personal vehicles, medium and heavy vehicles, diesel and petrol consumption, steel and cement sales/production, coal and rail freight statistics etc have been performing during July and August. They are all trending HIGHER. Similarly, the manufacturing PMI index for August, one of the most important measures to track economic expansion, is at 51.2, indicating that the underlying GDP is alive, well and, in fact, growing.</p>

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<h5>My bet is that GDP will accelerate to an average 7.4 per cent in the next two quarters.</h5>
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<p>And how does the economic landscape look from here till March 2018?</p>

<p>* My bet is that GDP will accelerate to an average 7.4 per cent in the next two quarters.<br />
* Companies, stores, malls and mom-and-pop shops will restock goods. The good effects of the ongoing remonetisation are already visible in hotels, construction and transportation sectors.&nbsp;<br />
* Consumption enters a higher trajectory as states implement salary increases recommended by the 7th Pay Commission. Therefore, disposable incomes rise.<br />
* The lag effects of lower interest rates start reflecting on corporate balance sheets, consumption levels and on banks&#39; non-performing assets.<br />
* The government kick starts spending, thanks to higher tax collections and aggressive asset sales in the stock markets.<br />
* The markets head higher as the government implements more reforms, further liberalises FDI and clamps down on black money.<br />
* And finally, a normal monsoon, inflation targeting by the central bank, ongoing digitisation and financial inclusion will go a long way in improving GDP in the medium term.</p>

<p>Great nation-states and sustainable economies are not made or broken in one or two quarters. India&#39;s economic trajectory is up despite minor blips. For those of us who have been watching this great nation take massive economic strides in the past three decades, a modest pull back is an opportunity to load up on some serious stocks. And for those who have perennially waged a war on the state, may I say: you shall lose again. No one has won a bet by going short in India. No one will.</p>


For those of us who have been watching this great nation take massive economic strides in the past three decades, a modest pull back is an opportunity to load up on some serious stocks.

Teary-eyed commentators have already beaten their chests hollow on how the twin curses of Demonetisation and implementation of the Goods & Services Tax have slowed India's economic engine to a mere 5.7 per cent expansion. The Opposition has already gone for the government's jugular for these two apparent self-goals and everyone on Dalal Street is anxious to know whether the ongoing bull market in stock prices will continue or not. The economy is in a temporary trough and just paused a bit in a bid to accelerate further. × So, what really happened and what is in store for India's economy, arguably the finest that is there in the global space as of now. Well, some of the brightest are missing the fine print: the economy is in a temporary trough and just paused a bit in a bid to accelerate further. It's the proverbial arrow that is pulled back on the bow before it hits the Bulls Eye. Often, when all the chips are down, it is Bollywood that saves the day: Therefore, "Picture abhi baaki hai, mere dost"! Such is the resilience of the Indian economy that it will ensure growth returns in leaps and bounds. And there are enough economic indicators that are pointing to it. True, second quarter GDP slowed to 5.7 per cent as companies cleaned up inventories and refused to manufacture on a large scale as the newly minted GST came into effect on July 1st. Since tax rates were to change largely for the better, sensible manufacturers thought it best to pause their production units for a while. That is the reason why you see manufacturing slowing to just 1.2 per cent growth during April-June versus 5.3 per cent in January-March. There are two parts of the story: the reasons why GDP expansion slowed to its lowest since October 2014 are heavy interest burden on leading corporates owing to large borrowings; an appreciating rupee that has hit exports and, in turn, lowered capacity utilisation and banks that are under severe stress and are unable to lend due to ballooning non-performing assets. The manufacturing PMI index for August, one of the most important measures to track economic expansion, is at 51.2, indicating that the underlying GDP is alive, well and, in fact, growing. × These factors have more or less stalled investments in capacity expansion. Therefore, growth slowed on the industrial side. A booming agricultural production also ensured that food prices at the farm level fell, thereby, resulting in agricultural growth slowing as well in the months of April to June. In any case, most economists had more or less written off two-quarters of GDP expansion post-November 2016, when the government introduced demonetisation by sucking out 86 per cent of the currency float. Now, look at how high-frequency economic indicators, such as monthly sales of motorcycles, personal vehicles, medium and heavy vehicles, diesel and petrol consumption, steel and cement sales/production, coal and rail freight statistics etc have been performing during July and August. They are all trending HIGHER. Similarly, the manufacturing PMI index for August, one of the most important measures to track economic expansion, is at 51.2, indicating that the underlying GDP is alive, well and, in fact, growing. My bet is that GDP will accelerate to an average 7.4 per cent in the next two quarters. × And how does the economic landscape look from here till March 2018? * My bet is that GDP will accelerate to an average 7.4 per cent in the next two quarters. * Companies, stores, malls and mom-and-pop shops will restock goods. The good effects of the ongoing remonetisation are already visible in hotels, construction and transportation sectors. * Consumption enters a higher trajectory as states implement salary increases recommended by the 7th Pay Commission. Therefore, disposable incomes rise. * The lag effects of lower interest rates start reflecting on corporate balance sheets, consumption levels and on banks' non-performing assets. * The government kick starts spending, thanks to higher tax collections and aggressive asset sales in the stock markets. * The markets head higher as the government implements more reforms, further liberalises FDI and clamps down on black money. * And finally, a normal monsoon, inflation targeting by the central bank, ongoing digitisation and financial inclusion will go a long way in improving GDP in the medium term. Great nation-states and sustainable economies are not made or broken in one or two quarters. India's economic trajectory is up despite minor blips. For those of us who have been watching this great nation take massive economic strides in the past three decades, a modest pull back is an opportunity to load up on some serious stocks. And for those who have perennially waged a war on the state, may I say: you shall lose again. No one has won a bet by going short in India. No one will.

The worst is over when it comes to slowing GDP growth

<p>India&#39;s second tryst with destiny starts from the midnight of June 30th when Asia&#39;s third largest economy rolls out her most ambitious tax reform. Prime Minister Narendra Modi and Finance Minister Arun Jaitley have collectively staked the reputation of the world&#39;s fastest growing major economy as a haven for reform when they unveil the Goods and Services Tax &nbsp;(GST) regime from Saturday, July 1st.</p>

<p>What prompts this economy measured at $2.4 trillion and growing at 7 per cent a year to revamp its British-era tax structure? Why would 1.25 billion people suddenly decide they need a new tax code? Why would 28 different state governments, some of them diametrically opposed to the Bharatiya Janata Party at the Centre, agree to be a part of a symphony that plays a common tune?&nbsp;</p>

<p>Some of these questions are complex and may take many months to answer but the road map for this pioneering tax rejig points to forging an economic union, a single national tax market, common tax laws and a common tax base for the country.</p>

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<h5>A population exceeding the combined citizenry of the United States, the European Union, Japan, Russia and Brazil will ring in the new tax structure from the Central Hall of Parliament on the stroke of midnight on June 30th.</h5>
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<p>There is no other comparable project this size anywhere in the world. A population exceeding the combined citizenry of the United States, the European Union, Japan, Russia and Brazil will ring in the new tax structure from the Central Hall of Parliament on the stroke of midnight on June 30th.&nbsp;</p>

<p>As the world sleeps, India will walk into to a new dawn. This event will be addressed by Prime Minister Modi and overseen by President Pranab Mukherjee, who steered the GST Bill as the finance minister during the previous UPA government.</p>

<p>India is young. Her 70-odd years as an independent nation has seen a potentially great economy being held back by a multitude of taxes and dozens of hierarchies, often pulling in different directions. But it has taken this economy, liberalised in 1991, a little over a quarter of a century to become the world&#39;s 3rd largest on purchasing power parity. Today&#39;s industrialist counts global companies as his rivals apart from homegrown peers. And there is a new breed of Indian entrepreneurs raring to take on the world on their terms. They need enabling tax laws that help take on global corporations on their turf.</p>

<p>Hopefully, the GST, even with all its so-called ills, will deliver a world class regime that will catalyse fresh growth in India against a slowing global economic order.</p>

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<h5>Collection and payment of taxes will be at a single point, therefore, easier.</h5>
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<p>So, what does the GST do?</p>

<p>To begin with, this fully online indirect tax replaces 12 central and state level taxes. This single, common tax will help the economic supply chain breathe easy. This chain will be fattened up and yet be flexible as taxes paid on input costs and raw materials will be claimed back. This will lead to lower costs and, consequently, better prices for the end consumer. Goods will move faster now as trucks will not be stopped at any entry points of states. Collection and payment of taxes will be at a single point, therefore, easier. Large, if not all, parts of the informal economy will move into the formal order. And finally, India&#39;s tax regime will be comparable to those in advanced economies.</p>

<p>Sure, there are quibbles. But there always have been naysayers who want to remain outside the ambit of the formal tax structure.</p>

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<h5>&quot;There are too many returns to file and everything is computerised!&quot;,&nbsp;some moan.</h5>
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<p>`We are not ready,&#39; say lakhs of traders, small businessmen, companies and even large corporations. `Delay it by another quarter,&#39; they shout from industry pulpits. &quot;There are too many returns to file and everything is computerised!&quot;,&nbsp;some moan. The last ones are particularly hilarious because you would think honest tax payers would welcome online payment of tax minus the hassles!</p>

<p>There will be nitpickers who will find fault at everything that any government does to improve the overall life of citizens. We must ignore such voices that clamour for the old order to continue. The next two quarters will be defining moments of India&#39;s upward trajectory as a world economic power. Sure, growth may slowdown further. Companies might take a while longer to adjust to online filing of returns. Lofty stock prices may take a small tumble. And the economy may wobble just a bit more. These things happen in the life of a young nation.</p>

<p>Use this opportunity to ride on to the finest economy the world has at this moment. You should be buying any dips in the market. This gravy train will get thicker and fatter as time passes.</p>

<p>No one has won betting against the Indian economy in the longer run. No one.</p>

<p>So make no mistake: the GST is here to stay.</p>

<p>&nbsp;</p>


GST will deliver a world class regime that will catalyse fresh growth in India against a slowing global economic order

India's second tryst with destiny starts from the midnight of June 30th when Asia's third largest economy rolls out her most ambitious tax reform. Prime Minister Narendra Modi and Finance Minister Arun Jaitley have collectively staked the reputation of the world's fastest growing major economy as a haven for reform when they unveil the Goods and Services Tax (GST) regime from Saturday, July 1st. What prompts this economy measured at $2.4 trillion and growing at 7 per cent a year to revamp its British-era tax structure? Why would 1.25 billion people suddenly decide they need a new tax code? Why would 28 different state governments, some of them diametrically opposed to the Bharatiya Janata Party at the Centre, agree to be a part of a symphony that plays a common tune? Some of these questions are complex and may take many months to answer but the road map for this pioneering tax rejig points to forging an economic union, a single national tax market, common tax laws and a common tax base for the country. A population exceeding the combined citizenry of the United States, the European Union, Japan, Russia and Brazil will ring in the new tax structure from the Central Hall of Parliament on the stroke of midnight on June 30th. × There is no other comparable project this size anywhere in the world. A population exceeding the combined citizenry of the United States, the European Union, Japan, Russia and Brazil will ring in the new tax structure from the Central Hall of Parliament on the stroke of midnight on June 30th. As the world sleeps, India will walk into to a new dawn. This event will be addressed by Prime Minister Modi and overseen by President Pranab Mukherjee, who steered the GST Bill as the finance minister during the previous UPA government. India is young. Her 70-odd years as an independent nation has seen a potentially great economy being held back by a multitude of taxes and dozens of hierarchies, often pulling in different directions. But it has taken this economy, liberalised in 1991, a little over a quarter of a century to become the world's 3rd largest on purchasing power parity. Today's industrialist counts global companies as his rivals apart from homegrown peers. And there is a new breed of Indian entrepreneurs raring to take on the world on their terms. They need enabling tax laws that help take on global corporations on their turf. Hopefully, the GST, even with all its so-called ills, will deliver a world class regime that will catalyse fresh growth in India against a slowing global economic order. Collection and payment of taxes will be at a single point, therefore, easier. × So, what does the GST do? To begin with, this fully online indirect tax replaces 12 central and state level taxes. This single, common tax will help the economic supply chain breathe easy. This chain will be fattened up and yet be flexible as taxes paid on input costs and raw materials will be claimed back. This will lead to lower costs and, consequently, better prices for the end consumer. Goods will move faster now as trucks will not be stopped at any entry points of states. Collection and payment of taxes will be at a single point, therefore, easier. Large, if not all, parts of the informal economy will move into the formal order. And finally, India's tax regime will be comparable to those in advanced economies. Sure, there are quibbles. But there always have been naysayers who want to remain outside the ambit of the formal tax structure. "There are too many returns to file and everything is computerised!", some moan. × `We are not ready,' say lakhs of traders, small businessmen, companies and even large corporations. `Delay it by another quarter,' they shout from industry pulpits. "There are too many returns to file and everything is computerised!", some moan. The last ones are particularly hilarious because you would think honest tax payers would welcome online payment of tax minus the hassles! There will be nitpickers who will find fault at everything that any government does to improve the overall life of citizens. We must ignore such voices that clamour for the old order to continue. The next two quarters will be defining moments of India's upward trajectory as a world economic power. Sure, growth may slowdown further. Companies might take a while longer to adjust to online filing of returns. Lofty stock prices may take a small tumble. And the economy may wobble just a bit more. These things happen in the life of a young nation. Use this opportunity to ride on to the finest economy the world has at this moment. You should be buying any dips in the market. This gravy train will get thicker and fatter as time passes. No one has won betting against the Indian economy in the longer run. No one. So make no mistake: the GST is here to stay.

GST: India's push into a higher economic orbit.

Author

Zee News Rajasthan

Editor

Shailendra Bhatnagar

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