Wednesday, September 23, 2020

Farmers are not beggars

Farmers are not beggars. They need to have freedom. 

People say, we fought with the Britishers and got freedom. But, people did not get freedom till 1991 and after that, gradually we are getting more freedom.

When a bill is introduced to give freedom to farmers to sell to anyone/anywhere he likes and to have any agreement with anyone, those who support freedom must encourage. Those whoever is against the portions of the bill that are giving freedom, are against the basic rights (freedom).

If the bill has any part which is nothing to do with freedom, and if people oppose, it is their right. But, opposing the part which gives freedom is nothing but opposing the basic rights.

Other Comments for the bill.

C: Government would reduce Minimum Support Price (MSP) after this.

A: Fight against that reduction. Not against the bill that gives freedom. 

C: Small Farmers won't benefit out of it. 

A: Not getting benefits out of some freedom is not a reason to curb freedom.

C: Prices would increase after this bill

A: Then, you become a farmer and get more money. Till you become rich by farming, whatever extra that you pay for food, consider it as a price that you are paying to the farmers for curbing their freedom from 1947 till 2020.

C: This change is not enough

A: Yes. This is a very very small change and many many more reforms need to be brought to change the state of farmers. This is a baby step in that direction. 

C: We cannot trust corporates

A: You are not asked to trust corporates. You have freedom to trust or not. 

C: It is replaced by a different set of middlemen from the existing middlemen. [And many other related questions]

A: So what? What is the problem?

C: Why are farmers opposing?

A: When everything is kept as it is, but more freedom is given, a sane person should never oppose. If there is a fear of future reductions in others like MSP, they should fight for the reduction of MSP rather than the bill that gives freedom. 

Whenever any reform is brought, which gives freedom to a particular sector, the first set of people/organizations that oppose is, the existing people/organizations in that sector. Because, they lose the hold on that sector with the new entrants in that sector.

For example, if any state government liberalizes the transport sector and allows anyone to run buses without government approval, the first set of people who oppose would be the existing private bus operators. They may give any kind of reasons (either stupid or reasons that may look good). The private bus operators would have paid crores of rupees as bribe to the ministers and other officials to start their service. When others start without any bribe, they would be at serious disadvantage, and they cannot match the fare and suffer serious losses.

C: Government may close APMC

A: Once the farmers are given freedom, it is possible that, other government channels would become redundant, especially, if the private channels offer competitive prices. In those cases, even if APMC becomes redundant, government should keep it there for the name sake, so that, private channels won't become syndicate [However if the market is really open, there is a less chance for players forming syndicate.] 

Government's business is not do business. But, it should make sure that, monopoly/syndicate is not formed. In case, if there is a monopoly or syndicate, government should bring their own business/service, mainly to break the monopoly and syndicate. Government's business should be limited to breaking the monopoly/syndicate.

Any leader can promise to bring something like APMC and can bring it. But, except leaders like P.V.Narasimha Rao, Vajpayee and Modi, no other leader is bringing the freedom to people. For a very very small problem (which can be solved by anyone), we should not stop a major reform like this.

Monday, September 21, 2020

Changes to Multi Cap Mutual Funds by SEBI

The recent rule on expecting Multi Cap Mutual Funds to invest minimum 25% in each of the Large Cap, Mid Cap and Small Cap, is one of the worst rules that is brought by SEBI in the recent time. 

Post 2017, Multi Cap Mutual Funds is the only category, where AMCs have full freedom to invest in any stock. With this restriction, SEBI is curbing that freedom of AMCs. After this rule, there is no category, where AMCs have full freedom to invest in any stock. 

Not only SEBI is restricting the freedom of AMCs, it is forcing the investors to learn about Market and keep track of that. We can no longer just blindly trust AMC and invest. Before this rule, if any investor wants to invest, and if they trust on any AMC and they don't have any knowledge on anything else, they can just go with Multi Cap Mutual Fund of that AMC. With this restriction, they need to decide whether to invest in Large Cap, Mid Cap or Small Cap and change the investments based on the market. When AMC has freedom to change the investments, they can do it on behalf of the investors.

Another reason that is mentioned in the media is, the investments in Multi Cap Mutual Funds are like either Large Cap or Large & Mid Cap or one of the existing schemes. So, there is no need for another category. I don't know whether this reason is given by SEBI or not. This reason may look correct for those who are doing day trading or have very small duration for their investments. But, it won't work for those who are doing investments for the long term.

When freedom is given to AMCs, they may invest in the stocks that are going to perform better. When they do that, most of the time, that would match with one of the categories defined by SEBI. But, in a couple of years, when the market is changed, and if they think, other category stocks are going to perform better, the AMC may shift their investments to the other category. At any time, the Multi Cap may match with one of the categories, but, the main difference is, changing their investments based on the market from one category to another category. That basic freedom is removed from AMCs.

If SEBI wants, it can create a new category with this rule and let AMCs use the new category, if required. Or it can keep the present rule, but create a new category where the AMCs get full freedom on whichever stocks they want. 

In 2017, SEBI restricted the number of categories, forcing AMCs to offer only the basic categories and reduce the redundant categories. With this rule, Multi Cap is going to violate the principle that it had set. After this rule, instead of investing in Multi Cap, they can invest 1/3rd of that amount in each of the Large Cap, Mid Cap and Small Cap. If AMC is following the principle of having minimum strategies, then the return of the Multi Cap is exactly going to be the average of Large Cap, Mid Cap and Small Cap. Then, why do we need the Multi Cap category at all? We can remove that. 

In the same way, the Large & Mid Cap fund category is also redundant, because the AMC is forced to invest a minimum 35% in Large and 35% in Mid Cap. If the AMC has freedom to invest in any stock of Large & Mid Cap with 70% limit, then that category is of some use. But, with the present rule, investing in Large & Mid Cap is exactly the same as investing half of the investment in Large and another half in Mid Cap. 

I am not worried about the Large & Mid Cap fund, because it is just another redundant fund. What I am worried about is, removing the only category that was giving freedom. 

Before 1991, few officers in the government used to decide the IPO price. Everyone knows how bad it is for the stock market. This rule is also going in that direction, where few government officers are deciding what people need. 

All this may go in deaf ears, if there is some hidden reason for bringing this change. For example, if SEBI brought this rule to increase investments in Small Cap and Mid Cap, then irrespective of the correct logical reasons, this rule might not be changed. If there are hidden reasons like that, it is going to harm the country. 

"It will be a folly to ignore realities; facts take their revenge if they are not faced squarely and well." - Sardar Vallabhai Patel 

Sunday, September 20, 2020

Completed reading ISKCON Bhagavatham.

Completed reading ISKCON Bhagavatham.

I have taken 19 years to read the 18 volumes of ISKCON Bhagavatham.

Saturday, September 12, 2020

Worst Rule by SEBI - On Restrictions on Multi Cap

SEBI introduced one of the worst rules for the Mutual Funds. It is expecting multi cap mutual funds to have minimum 25% of the assets in each of the large cap, mid cap and small cap. Anybody who has little bit brain and maths knowledge can understand that, it is very very difficult for small caps to match the large caps. After the categorization of the mutual funds couple of years back, Multi Cap is the only type, where AMCs can invest in any stock they want. With this restriction, there is no type, where AMCs have full freedom to choose the stocks. Are we going back to Pre-1991 days?

Saturday, July 25, 2020

Managing Voter Perception

The following is an excerpt from the book, "India Unmade: How the Modi Government Broke the Economy" by Yashwant Sinha. 

Sometimes even a benign measure can have adverse consequences, like the national highway project. I later found that in 2004 we lost all the constituencies that lay along the Grand Trunk Road that goes from West Bengal and through Jharkhand, Bihar, Uttar Pradesh, Haryana and Punjab up to the Pakistan border. It was a paradox. The highways programme was the Vajpayee government's most outstanding project - his enduring legacy, the accomplishment now cited by even his staunchest political opponents - so we should have won in those very constituencies. We lost, however, because all highway encroachers were evicted. Even in my constituency of Hazaribagh, removing encroachers made a lot of voters angry. This is the political reality of India.

There is thus an argument to be made that there is no correlation between good work and getting re-elected. Any correlation is the first fallacy of punditry. Voting is only marginally connected to the work you might have done, or the government you were a part of. It is dependent on many other factors which may or may not work in your favour. 

The biggest factor is managing voter perception, a fact of which the Modi government is obviously keenly aware. Take the election in 1989, in which V.P.Singh overtook Rajiv Gandhi as Mr Clean because the Congress prime minister was bogged down by the Bofors scandal. Chandra Shekar as prime minister used to wonder out loud to me that V.P.Singh as Rajiv's finance minister had to have given approval to the Bofors gun procuremenet. Yet he was never stained by the scandal. Rajiv Gandhi's defeat by V.P.Singh was thus a result of perception management.

Saturday, July 18, 2020

Lies, damned lies and statistics

Say there are 100 people in a community and 5 of them are poor. The poverty rate is 5%. Say one of them dies of starvation. There are now 99 people and 4 of them are poor. The poverty rate is now 4.04%. The Leader puts out a celebratory announcement: The Poverty Rate has Declined by nearly 20%!
But is this really a good thing?
A similar trap awaits the unwary in the other direction. Say, again, you start with a population of 100, where only 5 are poor. The poverty rate is 5%. However, let’s say that these poor people are the strongest and healthiest of the poor. The weaker ones, especially infants, already died. The Leader pumps money into healthcare for the poor, focusing on reducing infant mortality. The next year the census reports that the population is now 105, of which 10 are poor. The poverty rate is now 9.5%. The opposition party puts out an accusatory press release: Under Leader’s Inept Rule, Poverty Rate Increase by nearly 100%!
But is this really a bad thing?
The error, in both cases, is confusing a 3-state variable for a 2-state variable. There are really three states: poor-living, non-poor-living, and dead. Looking at poverty rates fails to consider the dead state.

Saturday, July 11, 2020

Can We Depend on GDP Alone For Measuring Growth

The following is an excerpt from the book Hit Refresh by Satya Nadella.

Would you prefer to have $100,000 today or be a millionaire in 1920? Many would love to be a millionaire in the previous century, but your money then could not buy lifesaving penicillin, a phone call to family on the other side of the country, or many of the benefits of innovations we take for granted today.

Government should not have the goal of increasing GDP. It should try to improve the technology, business, freedom for the people, and make people lives more comfortable. With that, if GDP increases, it is fine. If not, that should not be a problem. Government should not do anything that increases GDP but reduces anything that impacts people.

Saturday, July 04, 2020

Ad by a state government on no Discrimination

Excerpt from an Ad by a state government, who files cases on people for their facebook posts.
No discrimination by caste and religion
50% Reservations to SC, ST, BC and Minorities
The above two lines are one below another in the ad (and not in different pages). Somebody, please explain them the meaning of "No discrimination by caste and religion".

Saturday, June 27, 2020

Business by Govt vs Private

Indian government filed cases against Telecom companies like Vodafone, Airtel and Jio saying, they have to pay tens of thousands of crores as dues. When the same rules are applied to few other companies (called as Public Sector Undertaking) like Power Grid Coporation, GAIL India and Oil India etc., the dues would cross one lakh crore. But, those companies don't need to pay.

For those, who say that, the original case was related to Telecom companies, the other companies also bought spectrum and the exact same rules can be applied. If it is unfair for the PSU companies, it should be unfair to Vodafone, Airtel and Jio as well. 

Of course, if government wants to change the rule, it would change to something like, if the revenue from X business is more than Y% of the company, then this rule is applied, and they carefully choose X and Y, in such a way that, the companies that they want to target would fall in that category. 

I don't see BSNL in the list. Does it mean, BSNL paid all the taxes and fees as per the rules set by the Govt, just like it set to any other private telecom company? If it had really paid the taxes and fees as per the rules, what is the overall profit (or loss) of BSNL? If it is in losses, does it mean, a common man has to pay the tax/fee because of the mismanagement of the company? 

All the state governments run the buses. If any private player wants to run a bus, first they have to get a permit. The permit amount is pretty huge. Apart from paying the permit amount, they need to get the approval from the concerned minister/official. That permission would cost them a lot unofficially. Government run buses won't pay any permit fees whatsoever and obviously, they don't need to pay any amount unofficially. But, the private bus operators have to fight with the government run buses on the fare. On peak days, when the private bus operators increase the fare, we would crticize them for exploiting. 

Air India is in losses. Still common man is paying for the losses of running Air India. If the same thing happens to private operators, the company would be closed down, like King Fisher or Jet Airways. Only the shareholders of the company would lose and not the common man. 

The profit and losses are calculated differently for government and private companies (May be except in the sectors that are reformed like Coal etc.). When the government industry is trying to get something out of the natural resources, the revenue minus the expenditure is considered as profit. Whereas, for the private industry, one has to deduct the license fee to extract the natural resources, which is typically more than all other expenditures. When that government industry is in Profits (on books), the employees would fight for increase in the salaries, bonus etc., saying it is in profits. Many times, the profit that they say the got is far less than the license fee they would have got, had they given to a private player in fair means. 

Everyone says, Private companies are exploiting. But, in reality, Government is exploiting private sector and trying to show as if the private companies are demons. 

Eventhough India got partial Independence in 1991 (No. It did not get it in 1947), still Government is trying to reduce the freedom of the companies with something or other.

Saturday, June 20, 2020

Banning Chinese Products

These days, I am seeing people destroying Chinese products in the news.
If they are destroying something that is not working or if they are doing for some publicity, then I don't have any comments.
Otherwise, only the person who owns that product is at loss and nobody else.
If you don't like China, then you may not achieve anything by blindly banning Chinese products. If you are planning to buy some product, and for the quality that you are expecting, if a Chinese product is cheaper than other product, then buy the Chinese product. Whatever the money that you saved by that, donate it to any person/organization/entity/government that you think would make India better than China. If a Chinese product is more expensive than the other product, there is no point in buying Chinese product.
If China is selling weapons, there is nothing wrong in buying weapons from China and fighting with them by using the same weapons. In the same way, if we are getting some advantage by transacting with China, transact with China, and use the advantage against China (if you don't like China).

Sunday, May 31, 2020

Airtel Support - The most efficient support system in the world

Airtel is the one which has the most efficient support system in the entire world. [If you have not got it, it was a sarcastic comment.]

There was no way I can raise a complaint with Airtel DTH. Calling customer care says, install Airtel Thanks App. In Airtel Thanks app, there is no way to raise a complaint. They don't respond to mails.

The highlight is the IVR feedback system. In any IVR feedback, I typically hear two types of feedback.

First type is, press 1, if your problem is resolved, and press 2, if your problem is not resolved.

Other type is, press between 1 to 5, based on your level of satisfaction with this issue, where 1 being the lowest and 5 being the highest.

Even if the numbers vary, these are the two different options that I see in most of the IVR feedback options.

Airtel is having third type of feedback system.
Press 1, if your problem is resolved.
If you are unable to do A, B, C, Please do X, Y, Z. Press 2.

Hats off to Airtel for having such a brilliant feedback mechanism.

Saturday, May 30, 2020

Rules in Different States During Lockdown

The present rules of different states is like, each state is like a different country and issuing visas differently to other states.

Anyone can visit Telangana without any issue. But, if they have any symptoms, then they would be taken to institutional quarantine. Otherwise, they can go home.

In AP, one needs to register in Spandana App. Only after it is approved, they can book the tickets. If the person is coming from Chennai, Mumbai, Delhi, Gujarat, Rajasthan or M.P, then they have to mandatorily go for institutional quarantine for 7 days. If the person is coming from other areas, they can go home for home quarantine for 14 days, if they do not have any symptoms.

For Karnataka, the process is much more complicated and one has to read all the rules before visiting.

If a person who is coming from Chennai or Mumbai wants to visit A.P., then they should go to state like Telangana and from there, if they go to A.P., then they don't need to be in institutional quarantine. Otherwise, they would be in institutional quarantine for few days.

I see few forwards with one or two line rules for each state. The rules are much more complicated than that. If you are travelling to any state, please read all the rules of that state before the travel. Many times, the rules vary almost every week.

You can read the rules of different states from

Tuesday, May 26, 2020

Travel from Chennai to Hyderabad on the first flight after lock down

I travelled from Chennai to Hyderabad by the first available public transport after the lock down which does not require any government approval. The following is my journey details, which I am mentioning here, so that, those who are planning to travel (in the coming days) can be prepared.

Flight booking

I booked Indigo flight for the afternoon of 25th May. Late night of 24th May, I received message saying, the flight has been cancelled. I tried to rebook the flight, but, it was giving different errors each time. I tried to cancel the flight and get refund of the money. After undoing the checkin, that worked.  Later I realized that, I should not have done that, if the plan is to rebook the ticket in a week. Because, when we cancel the flight and ask for the credit, Indigo takes a week to credit the amount in your shell. So, within a week, if you have to book, you cannot use that. Also, the credit amount should be used within a year (and probably by the same passenger). So, not a good option, if one does not plan to travel that often. Fortunately, in my case, Indigo customer care helped me to change the flight to 25th May at 8:50 PM.

To Chennai Airport

In Chennai, no public transport was available, no cab/ola/uber available. Autos were very rare. You may need to be lucky to spot one. I started at home at 5 PM, and walked a lot of distance and found one unofficial transport vehicle who dropped me near by airport for Rs.800 for 5 kms. Even then, I had to walk a lot of distance to go the terminal with heavy luggage. During normal times, Ola cab used to come to my house and drop near the terminal for a charge of Rs.150.

In Chennai Airport

In Chennai Airport, they did thermal screening. Everyone had to do web checkin before.
Indigo expected everyone to take printouts of the boarding pass and luggage tags. But, they were not required. They gave me a  new boarding pass (since they were unable to scan my paper boarding pass) and they put their own baggage tags. In the ticket instructions, they said, they don't take extra luggage charges at the airport. My luggage crossed 6 kgs than their limit and they charged Rs.2400 for that, and they took credit card payment.

Flight got delayed and it started at 10.30 PM instead of 8.50 PM.

In Hyderabad Airport. 

Flight landed before 11.30 PM. First time, I saw people in India getting down in the order. Of course, as soon as the flight halted, everyone stood up to take their luggage and started waiting to go first. The flight attendant announced three times to get down in the order of the seat numbers, and people started getting down in the order of their seat numbers.

While coming out of the airport, they did thermal screening. If the temperature is fine, they let go without saying anything. By 12 AM, I was near the cab point and tried to book Ola/Uber and I could not get anything. After some time, I tried to check other cabs. Few cabs operated like share autos, taking three different passengers, and charging each one Rs.700-1000. I could not get anything as the cabs were very less. After some time, there were no cabs at all.

I went back and sat in Airport chairs till 4 AM, when I was asked to vacate the chairs. They said, nobody is supposed sit in the chairs as people would be coming from the arrival flights, and they expect everyone to go without waiting there.

I took free shuttle to the Airport bus station. There, I started waiting along with many other people including those who came in the same shuttle. When I casually asked for a cab, they said, one was available and I took it immediately. They charged Rs.700, which was usual charge. I wondered whether I was lucky to be the first one to ask casually or I was the only person there who was waiting for a cab.

By 5 AM, I reached my final destination. Total time taken was 12 hours (from 5 PM to 5 AM).

From the political angle, it was like, transport was started by Union (Central) Government and not started by state government. You go and figure out what to do. 

Saturday, February 01, 2020

To all the protesters of the CAA

To all the protesters of the CAA,

I appreciate your fight against the one time discrimination of non-Indians in the name of religion.

Can you also please fight for Indians who have been discriminated by the government based on caste, religion, region and many others since Independence with no plan to end the discrimination even in far future?