Disinvestment – A new Panacea for the Fiscal Deficit?

Disinvestment has been the buzz-word in recent times after the finance minister announced disinvestments in PSU’s to curb the all time high fiscal deficit. The government has chalked out a roadmap for disinvestments of its stake in public sector enterprises which will begin execution by mid August, but will retain 51% of its stake.

Why Disinvestment?

The government is seriously taking on the disinvestment route to ease fiscal pressures. The fiscal deficit is now estimated at 6.8% of the GDP for the financial year 2008-09 as against the projection of 2.5%. And this can create havoc on a recession facing economy, as interest rates could rise, the government could levy more taxes, and also it could stoke the now dormant inflation, as more money gets printed. Hence, the government would have to work on its disinvestment strategy and go in for an even stronger execution.

Disinvestments in the past

This is not the first time that a government has resorted to selling its wares. It was under the NDA regime in 1998 and 2004 that the government raised around Rs 33,700 Cr. And, this move helped reduce the fiscal deficit from 6.5% of the GDP to 4.5% over 3 years. Some of the PSU’s that the government has already disinvested in are BALCO and Maruti Udyog.

Investor Attractions!!

In the case of Rural Electrification Corporation which came out with its IPO in February 2008, the issue was slated to raise Rs 1,700 Cr and was priced at around Rs 105 per share. The issue got subscribed 1.62 times in a matter of an hour and despite the markets being in trouble over the last one year, the share price has already given investors a 50% return.

Governance in PSUs is however highly questionable, many times driven by political compulsions and this is a big dampener. However, investors can look forward to pick up some Ratnas or mini-ratnas and overlook some of their draw-backs. They will clearly be lining up for some of these gems. By encouraging public participation in the disinvestment drive, the India Inc. can look forward to a brighter future.

Simply Be!

Fashion is a word which most women relate to very quickly. A woman makes sure that her clothes and accessories are fashionable and suit her personality. Though there are a number of websites in the internet to buy your clothes, for all you women out there, I would like to mention about a site called simplybe.co.uk. As the site name suggests, you can simply be yourself when you wear these clothes. They are so comfortable and look amazingly elegant. This site is very famous for plus size women clothing. So check out their Clothing Catalogues and the vast variety of clothes and footwear they have. I am sure that you will be impressed with their collection. You can rest assured that the most fashionable and trendy clothes are available in this site. It is a one-stop-shop for all of you who want the latest clothes and accessories. If you are a working woman, visit this site without a second thought because you will get a discount of 20% on all work wear. You get some of the best brands in the world in this site. My favourite picks were Ladies Longsdale zip through hood and Ladies Longsdale jog pants. I think they both make a wonderful combination and makes you look great in winter especially. Once you register with their site and place your order, you can rest assured to get your clothes at your doorstep at the earliest. So why wait? Visit simplybe.co.uk and show off your new clothing!

Car insurance

"Go green". This seems to the the most famous saying in almost every part of the world now. Awareness is spreading among the people in this world to preserve mother earth. In this context, let me tell you about an insurance company which has taken an initiative to make the world more greener. Eco friendly car insurance at ibuyeco.co.uk should be bought by everyone as the company donates £5 to an eco charity when you sign up. In their initiative of Green car insurance you can offset 100% of your carbon emissions. In other words, you can choose to support one of their sponsored eco-friendly projects around the world that would counterbalance the damage your driving does to the environment. There are many such Car insurance initiatives. You can visit their site to get a clear picture of the kind of insurances they provide. Let us all work towards making this world a better, greener place to live in.

Wedding cards!

The most unforgettable day in your life will of course be the D-day - the day of the Big fat wedding. Very few people will disagree to this fact. People will want to make their wedding really special. Wedding cards need to be equally special. I came across a site called 123print.com when I was browsing online and I must admit that they have some of the best designs for wedding invitations in this world. Most designs are pretty and cute. All you girls out there can have a vast variety of cards to choose from and I am sure that your fiance` will love those cards. Go ahead and choose the best design for your wedding cards and make your wedding really special :)

Led Lights

I was attending a music concert of a famous band (which I don't want to name). Everything went on well in the show until a point when the power went off. The generators did not work and there was practically nothing happening in the show for sometime. The show organizers were frantically running all over the place to get things right and the audience was getting annoyed. This could have been avoided if there was proper lighting set up. Lighting becomes very important when it comes to any sort of a function/concert or any such show. It is important to have the right kind of lighting to impress the audience as well. Magna lights gives you the best led lights for reasonable prices. You can find all sorts of flashlights and golights. They have a variety of lights that you can choose from. You get different designs and colours for your lights. These lights can be used in your homes to make sure that there is lighting even of the power goes off. I would like to mention about golights in particular. These are remote control lights that are very user friendly. Such lights are apt to be used in military and mining fields. So to get the best led lighting equipments, visit the website of magna lights and "brighten" your life. :)

Sneak peek to Indian economy

The period between 2003-2005 saw the Indian economy grow at an average rate of 9%, an exchange rate of 39.5Rs/$ and a manageable fiscal deficit of 2.4%.Analysts predicted that the boom phase would persist and that India would surpass China in terms of growth, by 2010.However, the surfacing of the Subprime crisis in the US markets and the subsequent spread of contagion, led to a reversal of this growth story. As the FIIs (mostly American or European) pulled out of the Indian markets to meet their own liquidity requirements, the stock markets crashed and the companies found themselves in a credit crunch, incapable of financing their projects. The global turmoil and price fluctuations caused the shutdown of most manufacturing units thereby shrinking their revenues substantially. With almost 52%of the GDP coming from the services sector, the decline in outsourcing services to western countries reduced the revenue from IT services. Decrease in export demand from the western countries, depreciation of the rupee and subsequent rise in the import bill, layoffs and liquidity crunch were other dire consequences of the slowdown. Let us wait and watch what more is in stock!!