Falling rupee: Do NRIs really gain?
By GOPAL SUTAR
Published: Sep 24, 2011 23:03 Updated: Sep 24, 2011 23:03
BANGALORE: Contrary to the rising stock market, a falling Indian currency sends a sense of fear in the Indian economy. The rupee recorded its sharpest fall in a single day in 15 years on Sept. 22, closing at a 28-month low at 49.58 against the US dollar.
However, such a decline augurs well for all those who send their money to India. Nearly 30 percent out of $55 billion transferred by the Indians to their home country in 2010 was from the Gulf.
At present, most expatriates earning outside the country seem happy with the declining rupee. With the festive season fast approaching and possibility of rupee weakening further, more remittances are bound to be made.
“No one would like to miss the opportunity to get that extra money”, says a banking official in Bangalore, India’s IT hub. The Indian rupee has lost more than 9 percent against the Greenback this year alone. One Saudi riyal now fetches over Rs. 13.
Indian experts blame it on euro zone crisis, which has weakened the euro resulting in a stronger dollar.
The dollar demand is on the rise in India ever since the government relaxed the overseas borrowing limit in July this year. It is alleged that some companies are hoarding dollars even by paying premium and this has created a demand-supply crisis. Once the rupee breached the 49 level, the Reserve Bank of India (RBI) intervened but could not stop the slide.
All this is bad news for Indian economy even as Indian expatriates rejoice.
NRIs may have more money in their hands, but investors and their families in India do not gain much.
India is a net borrower of the dollar. The declining currency acts as fuel for inflation. The petrol prices in India are amongst the highest in the world at current exchange rates. The bulk of India’s crude requirement — nearly 70 percent — is imported by paying cash in dollar terms.
The weak rupee also means India has to cough up more for raw materials needed for manufacturing activities, which have slowed down in the past few months.
When India pays more for its import, the fiscal deficit widens. As it is, the country has been struggling to overcome the deficit menace for years despite slew of measures announced by its Finance Minister from time to time. The government is facing severe criticism for its fiscal profligacy.
With a few exceptions such as the IT sector and pharmaceuticals to a certain degree, the declining rupee has hit India’s large private sector companies including Reliance Industries Ltd., blue-chip public sector organizations such as Indian Oil, Hindustan Petroleum, metal industries and real estate companies.
Ultimately, everything gets passed on to the consumer and therefore in real terms the NRIs may not benefit to the extent they believe.
However, due to the falling rupee their earnings or salaries get automatically hiked in cash terms compared to resident Indians who might have to wait for long for any increase in their income.
http://arabnews.com/economy/article506261.ece
Sunday, September 25, 2011
Reserve Bank of India binds NRIs and their relatives
Reserve Bank of India binds NRIs and their relatives
By GOPAL SUTAR
Published: Sep 20, 2011 02:57 Updated: Sep 20, 2011 02:57
BANGALORE: The Reserve Bank of India (RBI) has made a few changes in the Foreign Exchange Management Act (FEMA) to boost more cooperation between NRIs and their relatives.
The central bank has now allowed the relatives of non-resident Indians to bear the medical expenses of visiting NRI relatives.
The resident Indians have also been given permission to repay loans availed from banks in Indian rupees in India by their NRI relatives.
As per another notification, NRIs can also hold joint accounts with their Indian resident relatives.
This applies to Foreign Currency Non-Resident (FCNR) account and Non-Resident External (NRE) Rupee account.
Resident individuals are permitted to make gift in rupees to close NRI relatives.
The amount must be transferred by check or by electronic means.
The amount should be credited to the Non-Resident (Ordinary) Rupee Account (NRO) account of the NRI.
The gift amount needs to be within the overall limit of $200,000 per financial year as permitted under the Liberalized Remittance Scheme (LRS) for a resident individual.
It would be the responsibility of the resident donor to ensure that the gift amount being remitted is under the LRS and all the remittances under the LRS during the financial year including the gift amount do not exceed the limit prescribed.
According to the bank notifications, the necessary amendments related to FEMA are being carried out separately.
http://arabnews.com/economy/article503843.ece
By GOPAL SUTAR
Published: Sep 20, 2011 02:57 Updated: Sep 20, 2011 02:57
BANGALORE: The Reserve Bank of India (RBI) has made a few changes in the Foreign Exchange Management Act (FEMA) to boost more cooperation between NRIs and their relatives.
The central bank has now allowed the relatives of non-resident Indians to bear the medical expenses of visiting NRI relatives.
The resident Indians have also been given permission to repay loans availed from banks in Indian rupees in India by their NRI relatives.
As per another notification, NRIs can also hold joint accounts with their Indian resident relatives.
This applies to Foreign Currency Non-Resident (FCNR) account and Non-Resident External (NRE) Rupee account.
Resident individuals are permitted to make gift in rupees to close NRI relatives.
The amount must be transferred by check or by electronic means.
The amount should be credited to the Non-Resident (Ordinary) Rupee Account (NRO) account of the NRI.
The gift amount needs to be within the overall limit of $200,000 per financial year as permitted under the Liberalized Remittance Scheme (LRS) for a resident individual.
It would be the responsibility of the resident donor to ensure that the gift amount being remitted is under the LRS and all the remittances under the LRS during the financial year including the gift amount do not exceed the limit prescribed.
According to the bank notifications, the necessary amendments related to FEMA are being carried out separately.
http://arabnews.com/economy/article503843.ece
Monday, June 27, 2011
India Relaxes Banking Norms for Foreign Nationals
India Relaxes Banking Norms for Foreign Nationals
Here is the good news for foreign nationals employed in India holding valid visas. The Reserve Bank of India (RBI) has now decided to allow them to maintain resident accounts with authorized banks in India even after leaving the country. Earlier, their resident accounts were closed immediately once they left the Indian shores and their assets were transferred to their accounts maintained abroad. According to Dr. Sujatha Elizabeth Prasad, Chief General Manager-in-Charge of RBI when such persons leave India for a country other than Nepal or Bhutan for employment, business or for any other reasons for an uncertain period, their existing account would now be designated as a Non-Resident Ordinary (NRO) account. This is being done to facilitate the foreign nationals to collect their pending dues in India, she adds. The account would be closed immediately after all the dues are received and repatriated as per the declaration made by the account holder.
The banks have been directed to repatriate the funds credited to the NRO account immediately to the foreign national after verifying whether the account holder has paid applicable income and other taxes in India. However, the amount repatriated abroad cannot exceed US $ one million in a financial year. Scores of foreign nationals in India working in areas such as IT, banking and multinational firms would benefit with this RBI’s new regulation.
Here is the good news for foreign nationals employed in India holding valid visas. The Reserve Bank of India (RBI) has now decided to allow them to maintain resident accounts with authorized banks in India even after leaving the country. Earlier, their resident accounts were closed immediately once they left the Indian shores and their assets were transferred to their accounts maintained abroad. According to Dr. Sujatha Elizabeth Prasad, Chief General Manager-in-Charge of RBI when such persons leave India for a country other than Nepal or Bhutan for employment, business or for any other reasons for an uncertain period, their existing account would now be designated as a Non-Resident Ordinary (NRO) account. This is being done to facilitate the foreign nationals to collect their pending dues in India, she adds. The account would be closed immediately after all the dues are received and repatriated as per the declaration made by the account holder.
The banks have been directed to repatriate the funds credited to the NRO account immediately to the foreign national after verifying whether the account holder has paid applicable income and other taxes in India. However, the amount repatriated abroad cannot exceed US $ one million in a financial year. Scores of foreign nationals in India working in areas such as IT, banking and multinational firms would benefit with this RBI’s new regulation.
Sunday, May 29, 2011
NRIs should file tax returns online to ensure refunds
'NRIs should file tax returns online to ensure refunds'
By GOPAL SUTAR | ARAB NEWS
Published: May 29, 2011 02:05 Updated: May 29, 2011 02:05
BANGALORE: The Indian financial year from April 2010 to March 2011 has ended and filing of income tax return, a cumbersome issue for both resident and non-resident Indians (NRIs), is in the forefront again. The worst is the waiting period involved in getting the refund from the government for the excess tax paid by the honest taxpayers. The delay in issuing the refund money for various administrative reasons has been the bane of the system for the last several decades. But all this could change for the better in the case of those who choose to file their returns online simply because the government plans to process the electronic claims on priority - as it is easy and fast - and send the refund within a month or so.
The physical process takes around 10 months that too if everything goes well and certified as "clear cases" by the officials. Now the Central Board of Direct Taxes (CBTD) wants to change its image and encourage electronic filing for early settlement of cases through expeditious refunds. Online filing is particularly good for NRIs who pay income tax in India for their earnings generated in India through property, local bank deposits, businesses, investments in stocks, etc. With the click of a mouse they can now help themselves, their kith and kin in filing tax returns by logging on to https://incometaxindiaefiling.gov.in/portal/login.do
Launched in October 2006, e-filing is mandatory for companies but has been optional for individuals. The verification of the tax returns filed on paper is so tedious that nearly four million refund cases were pending with the tax department as on Dec. 31, 2010. Also, when people resort to physical filing, it costs the government in terms of extra employment, as claims too have to be physically verified and then entered into the system. The manual work in part delays the refund process and further compels the government to pay extra as interest has be worked our for a period the refund is delayed or retained. For example, Indian government refunded extra tax of Rs.780 billion for the year 2010-11 alone because of the delayed processing of cases. According to CBTD charter, excess tax along with the interest should be refunded within nine months in case of manual filing and in six months if the return is e-filed. However, the manual filing cases take a much longer time. The other advantage of the e-filing is one can avoid corrupt officials and frauds related to the refund system.
By GOPAL SUTAR | ARAB NEWS
Published: May 29, 2011 02:05 Updated: May 29, 2011 02:05
BANGALORE: The Indian financial year from April 2010 to March 2011 has ended and filing of income tax return, a cumbersome issue for both resident and non-resident Indians (NRIs), is in the forefront again. The worst is the waiting period involved in getting the refund from the government for the excess tax paid by the honest taxpayers. The delay in issuing the refund money for various administrative reasons has been the bane of the system for the last several decades. But all this could change for the better in the case of those who choose to file their returns online simply because the government plans to process the electronic claims on priority - as it is easy and fast - and send the refund within a month or so.
The physical process takes around 10 months that too if everything goes well and certified as "clear cases" by the officials. Now the Central Board of Direct Taxes (CBTD) wants to change its image and encourage electronic filing for early settlement of cases through expeditious refunds. Online filing is particularly good for NRIs who pay income tax in India for their earnings generated in India through property, local bank deposits, businesses, investments in stocks, etc. With the click of a mouse they can now help themselves, their kith and kin in filing tax returns by logging on to https://incometaxindiaefiling.gov.in/portal/login.do
Launched in October 2006, e-filing is mandatory for companies but has been optional for individuals. The verification of the tax returns filed on paper is so tedious that nearly four million refund cases were pending with the tax department as on Dec. 31, 2010. Also, when people resort to physical filing, it costs the government in terms of extra employment, as claims too have to be physically verified and then entered into the system. The manual work in part delays the refund process and further compels the government to pay extra as interest has be worked our for a period the refund is delayed or retained. For example, Indian government refunded extra tax of Rs.780 billion for the year 2010-11 alone because of the delayed processing of cases. According to CBTD charter, excess tax along with the interest should be refunded within nine months in case of manual filing and in six months if the return is e-filed. However, the manual filing cases take a much longer time. The other advantage of the e-filing is one can avoid corrupt officials and frauds related to the refund system.
Monday, April 18, 2011
Australian dollar attracts NRI investors
If you are an Indian working outside the country and investing your money in the US dollar denominated fixed deposits in Indian banks, it might be a good idea to consider investing in Australian dollar instead. According to the banking sources in India, increasing number of non-resident Indians (NRIs) have been converting their US greenback held foreign currency non-resident deposit in banks (FCNR-B) into high yielding Australian dollar. This is because compared to the US and the UK, interest rates remain high Down Under resulting in extra earning of interest from Australian dollar-denominated deposits.
In recent times, Australia has been quick to raise the interest to tame the inflation while the UK and the US - struggling to get over the economic crisis of 2008 - have been too cautious with their low interest rates of nearly zero! Europe, which too has been hit by the crisis one after the other, recently raised rates for the first time since 2008 but the deposit in Euro is not attractive given the sea-saw battle with the US dollar, uncertainties over the economies of euro zone countries such as Portugal, Ireland, Greece and Spain, now sarcastically derided as PIGS.
Indian investors holding foreign currency non-resident account are allowed to hold their deposits in any of the six currencies: Japanese yen, pound sterling, Canadian dollar, Australian dollar, Euro and American dollar. However, the investors need to watch out for possible interest rate hike in the US, UK and Europe, although experts do not believe that these hikes, if at all they take place, would be anywhere near prevailing rates in Australia.
In recent times, Australia has been quick to raise the interest to tame the inflation while the UK and the US - struggling to get over the economic crisis of 2008 - have been too cautious with their low interest rates of nearly zero! Europe, which too has been hit by the crisis one after the other, recently raised rates for the first time since 2008 but the deposit in Euro is not attractive given the sea-saw battle with the US dollar, uncertainties over the economies of euro zone countries such as Portugal, Ireland, Greece and Spain, now sarcastically derided as PIGS.
Indian investors holding foreign currency non-resident account are allowed to hold their deposits in any of the six currencies: Japanese yen, pound sterling, Canadian dollar, Australian dollar, Euro and American dollar. However, the investors need to watch out for possible interest rate hike in the US, UK and Europe, although experts do not believe that these hikes, if at all they take place, would be anywhere near prevailing rates in Australia.
Tuesday, March 1, 2011
India’s budget seeks FIIs and curb black money
India’s budget seeks FIIs, curb black money, corruption
India’s Finance Minister, Pranab Mukherjee who presented Union Budget 2011 on Monday, has tried his best to woo the Foreign Institutional Investors (FIIs) in the coming years. He raised FII limit in five-year corporate bonds for investment in infrastructure by $20 billion. This has been done to enhance the flow of funds to the infrastructure sector. This will raise the total limit available to the FIIs for investment in corporate bonds to $ 40 billion. As most of the infrastructure companies are organized in the form of Special Purpose Vehicles (SPVs), FIIs would also be permitted to invest in unlisted bonds with a minimum lock-in period of three years.
Mukherjee has also permitted Securities and Exchange Board of India (SEBI) registered mutual funds to accept subscriptions from foreign investors who meet the Know Your Customer (KYC) requirements for equity schemes. This would enable Indian Mutual Funds to have direct access to foreign investors and widen the class of foreign investors in Indian equity market. Currently, only those FIIs and sub-accounts registered with the SEBI and Non Resident Indians (NRIs) are allowed to invest in mutual fund schemes
The Minister has focused on making the Foreign Direct Investment (FDI) policy more user-friendly by consolidating all prior regulations and guidelines into one comprehensive document, which is reviewed every six months. “Discussions are underway to further liberalize the FDI policy”, he said.
According to Mukherjee, the Government has commissioned a study on unaccounted wealth held within and outside India to find ways to tax and repatriate illicit money. “A group of ministers has been constituted to consider measures for tackling corruption”, he said. Their task is to look into state funding of elections, speedier processing of corruption cases of public servants, transparency in public procurement and contracts, discretionary powers of Central ministers and competitive system for exploiting natural resources. The group has to make recommendations in a time bound manner.
The budget proposes a total of INR 2.5 billion to two Muslim organizations: the upcoming centers of Aligarh Muslim University at Murshidabad in West Bengal and Malappuram in Kerala; and Maulana Azad Education Foundation. The special grant is to recognize excellence in universities and academic institutions.
India’s Finance Minister, Pranab Mukherjee who presented Union Budget 2011 on Monday, has tried his best to woo the Foreign Institutional Investors (FIIs) in the coming years. He raised FII limit in five-year corporate bonds for investment in infrastructure by $20 billion. This has been done to enhance the flow of funds to the infrastructure sector. This will raise the total limit available to the FIIs for investment in corporate bonds to $ 40 billion. As most of the infrastructure companies are organized in the form of Special Purpose Vehicles (SPVs), FIIs would also be permitted to invest in unlisted bonds with a minimum lock-in period of three years.
Mukherjee has also permitted Securities and Exchange Board of India (SEBI) registered mutual funds to accept subscriptions from foreign investors who meet the Know Your Customer (KYC) requirements for equity schemes. This would enable Indian Mutual Funds to have direct access to foreign investors and widen the class of foreign investors in Indian equity market. Currently, only those FIIs and sub-accounts registered with the SEBI and Non Resident Indians (NRIs) are allowed to invest in mutual fund schemes
The Minister has focused on making the Foreign Direct Investment (FDI) policy more user-friendly by consolidating all prior regulations and guidelines into one comprehensive document, which is reviewed every six months. “Discussions are underway to further liberalize the FDI policy”, he said.
According to Mukherjee, the Government has commissioned a study on unaccounted wealth held within and outside India to find ways to tax and repatriate illicit money. “A group of ministers has been constituted to consider measures for tackling corruption”, he said. Their task is to look into state funding of elections, speedier processing of corruption cases of public servants, transparency in public procurement and contracts, discretionary powers of Central ministers and competitive system for exploiting natural resources. The group has to make recommendations in a time bound manner.
The budget proposes a total of INR 2.5 billion to two Muslim organizations: the upcoming centers of Aligarh Muslim University at Murshidabad in West Bengal and Malappuram in Kerala; and Maulana Azad Education Foundation. The special grant is to recognize excellence in universities and academic institutions.
Sunday, February 20, 2011
Jet Airways launches landmark flights to Dammam, Dubai
Jet Airways launches landmark flights to Dammam, Dubai
India’s premier international airline, Jet Airways is introducing two new daily flights to the Gulf – Dammam and Dubai - to emerge as the first private Indian airline to operate 100 daily flights to international destinations across the globe. The new Mumbai-Dammam service represents the fourth daily service from India to Saudi Arabia. The airline currently operates daily flights from Mumbai to Riyadh and Jeddah and from Thiruvananthapuram to Dammam.
Jet Airways is also launching a third daily flight between Mumbai and Dubai. The sources in the airlines claim that with three flights between these two points, business and leisure customers of Jet Airways have a wide choice of timings throughout the day. The flights are conveniently timed to connect with Jet Airways' domestic network and fast-growing network to SAARC/ASEAN points. The airline also operates daily direct flights to Dubai from Chennai, Delhi and Hyderabad, which makes the additional flight from Mumbai to Dubai the sixth daily direct service on this sector.
The flight 9W 564 will depart Mumbai at 14:00 hours reaching Dammam at 15:45 hours local time. On the return sector, flight 9W 563 will depart Dammam at 16:45 hours and reach Mumbai at 22:55 hours. Flight 9W 538 will depart Mumbai at 15:10 hours and arrive in Dubai at 16:50 hours local time. The return flight 9W 537 will depart Dubai at 1830 hours, arriving in Mumbai at 2255 hours.
The airline says that it is deploying its state-of-the-art Boeing 737-800 aircraft on these two additional routes, offering Premiere and Economy configurations. “We are confident that the additional services from Mumbai to Dubai and Dammam will prove immensely popular with our guests”, says Jet Airways CEO, Nikos Kardassis.
India’s premier international airline, Jet Airways is introducing two new daily flights to the Gulf – Dammam and Dubai - to emerge as the first private Indian airline to operate 100 daily flights to international destinations across the globe. The new Mumbai-Dammam service represents the fourth daily service from India to Saudi Arabia. The airline currently operates daily flights from Mumbai to Riyadh and Jeddah and from Thiruvananthapuram to Dammam.
Jet Airways is also launching a third daily flight between Mumbai and Dubai. The sources in the airlines claim that with three flights between these two points, business and leisure customers of Jet Airways have a wide choice of timings throughout the day. The flights are conveniently timed to connect with Jet Airways' domestic network and fast-growing network to SAARC/ASEAN points. The airline also operates daily direct flights to Dubai from Chennai, Delhi and Hyderabad, which makes the additional flight from Mumbai to Dubai the sixth daily direct service on this sector.
The flight 9W 564 will depart Mumbai at 14:00 hours reaching Dammam at 15:45 hours local time. On the return sector, flight 9W 563 will depart Dammam at 16:45 hours and reach Mumbai at 22:55 hours. Flight 9W 538 will depart Mumbai at 15:10 hours and arrive in Dubai at 16:50 hours local time. The return flight 9W 537 will depart Dubai at 1830 hours, arriving in Mumbai at 2255 hours.
The airline says that it is deploying its state-of-the-art Boeing 737-800 aircraft on these two additional routes, offering Premiere and Economy configurations. “We are confident that the additional services from Mumbai to Dubai and Dammam will prove immensely popular with our guests”, says Jet Airways CEO, Nikos Kardassis.
Thursday, February 3, 2011
Hike in NRO Term Deposits: Time to Take Advantage
Hike in NRO Term Deposits: Time to Take Advantage
These are best times for the non-resident Indians who have placed or are keen to park their money in ordinary Non-Resident Rupee (NRO) accounts in Indian banks as interest rates have gone up significantly in last few months. It is now at least 9% for over 500 days term deposits in most of the banks and therefore the new entrants as well as the old account holders need to ponder over the change in interest rate structure that slightly varies slightly from bank to bank. On the other hand interest rates for Non Resident (External) Rupee (NRE) and Foreign Currency Non Resident (FCNR) accounts are around 2.5% for two year term. NRE and FCNR accounts are tax free but the tax is deducted at source on the interest earned on NRO accounts. For example, in case of NRO deposits tax is levied at 30.90% for the interest earned up to INR one million in a year.
Just last January, interest on NRO used to be around 7% or less. “Those who have parked their money for less interest should consider pre-mature closing of their term deposits and open new deposits to take advantage immediately”, says a banking official pointing out that now more banks may start imposing the penalty if the money is withdrawn before completion of the maturity period. Banks are being compelled to take such a step to minimize any impact on their liquidity position at a time when rising interest rates are pushing up the cost of funds for them.
At present many banks – mostly those in private sector - do not impose any penalty to lure the customers. Some pay interest rate applicable for the period for which the deposits have been maintained while some already have mechanism in place to penalize early withdrawals in a small way. The investors who want to take advantage of continuous rise in interest rates over recent months should calculate the actual gain in case their bank imposes penalty on premature withdrawal. In most cases recalculations should work-out in favor of customers. Moreover, for online users it is hassle free and just takes a few minutes to get out of their existing term deposits and reinvest.
Gopal Sutar
These are best times for the non-resident Indians who have placed or are keen to park their money in ordinary Non-Resident Rupee (NRO) accounts in Indian banks as interest rates have gone up significantly in last few months. It is now at least 9% for over 500 days term deposits in most of the banks and therefore the new entrants as well as the old account holders need to ponder over the change in interest rate structure that slightly varies slightly from bank to bank. On the other hand interest rates for Non Resident (External) Rupee (NRE) and Foreign Currency Non Resident (FCNR) accounts are around 2.5% for two year term. NRE and FCNR accounts are tax free but the tax is deducted at source on the interest earned on NRO accounts. For example, in case of NRO deposits tax is levied at 30.90% for the interest earned up to INR one million in a year.
Just last January, interest on NRO used to be around 7% or less. “Those who have parked their money for less interest should consider pre-mature closing of their term deposits and open new deposits to take advantage immediately”, says a banking official pointing out that now more banks may start imposing the penalty if the money is withdrawn before completion of the maturity period. Banks are being compelled to take such a step to minimize any impact on their liquidity position at a time when rising interest rates are pushing up the cost of funds for them.
At present many banks – mostly those in private sector - do not impose any penalty to lure the customers. Some pay interest rate applicable for the period for which the deposits have been maintained while some already have mechanism in place to penalize early withdrawals in a small way. The investors who want to take advantage of continuous rise in interest rates over recent months should calculate the actual gain in case their bank imposes penalty on premature withdrawal. In most cases recalculations should work-out in favor of customers. Moreover, for online users it is hassle free and just takes a few minutes to get out of their existing term deposits and reinvest.
Gopal Sutar
Sunday, January 2, 2011
India’s Beautiful Resorts through Killer Roads
India’s Beautiful Resorts through Killer Roads
The death of 31 women, who had just celebrated marriage of their relative on December 14, 2010 in road-accident on busy high-way, is yet not another example of India’s crumbling infrastructure. The major cause for concern is it happened on the road that leads to popular tourist destination Ootty - also known as the blue mountain - through thick forest reserves of Bandipur and Madumalai in South India. Moreover, it is not an isolated incident as deaths on this route is common feature. Part of the problem could be attributed to drunken and careless drivers but the authorities cannot escape the criticism as most of the roads in the hinter-land are single-lane, narrow, full of potholes and curves with no barricades.
Soon after the ghastly incident hundreds of villagers came out and protested by blocking the “killer road” to attract the attention of those who matter. Politicians have promised to initiate steps to construct culverts alongside the lakes to ensure that cars and buses do not plunge into water as it happened on Tuesday when the driver, allegedly drunk, lost control of his mini-bus. “The truth is it could happen to any driver”, says a villager pointing out at the close distance between the road and the lake.
It is nightmare to even drive about 30 km on this road from Mysore - another popular tourist place in South India - towards Ooty. I counted five big water-bodies on this small but picturesque stretch. A little error, and the curves on damaged roads lead straight into these ponds besides possibility of head-on collision with the vehicle coming from the opposite side.
According to one estimate, at least 400 accidents take place, 50 people die and hundreds are injured every year on this small stretch alone. India’s infrastructure development is dogged with litigations from land losers, environment groups and slow decision making process. With the government now promising culverts and four-lane project since the locals are killed, one wonders how many more lives would be lost till such promises are turned into reality. It does not matter for the newlywed couple as their lives are already shattered.
Photo caption
Lake alongside busy high-way, recipe for disaster?
The death of 31 women, who had just celebrated marriage of their relative on December 14, 2010 in road-accident on busy high-way, is yet not another example of India’s crumbling infrastructure. The major cause for concern is it happened on the road that leads to popular tourist destination Ootty - also known as the blue mountain - through thick forest reserves of Bandipur and Madumalai in South India. Moreover, it is not an isolated incident as deaths on this route is common feature. Part of the problem could be attributed to drunken and careless drivers but the authorities cannot escape the criticism as most of the roads in the hinter-land are single-lane, narrow, full of potholes and curves with no barricades.
Soon after the ghastly incident hundreds of villagers came out and protested by blocking the “killer road” to attract the attention of those who matter. Politicians have promised to initiate steps to construct culverts alongside the lakes to ensure that cars and buses do not plunge into water as it happened on Tuesday when the driver, allegedly drunk, lost control of his mini-bus. “The truth is it could happen to any driver”, says a villager pointing out at the close distance between the road and the lake.
It is nightmare to even drive about 30 km on this road from Mysore - another popular tourist place in South India - towards Ooty. I counted five big water-bodies on this small but picturesque stretch. A little error, and the curves on damaged roads lead straight into these ponds besides possibility of head-on collision with the vehicle coming from the opposite side.
According to one estimate, at least 400 accidents take place, 50 people die and hundreds are injured every year on this small stretch alone. India’s infrastructure development is dogged with litigations from land losers, environment groups and slow decision making process. With the government now promising culverts and four-lane project since the locals are killed, one wonders how many more lives would be lost till such promises are turned into reality. It does not matter for the newlywed couple as their lives are already shattered.
Photo caption
Lake alongside busy high-way, recipe for disaster?
Rising Economy, Gulf Operations Save India’s Airlines
Rising Economy, Gulf Operations Save India’s Airlines
Notwithstanding the controversy surrounding exorbitant prices charged by the airlines in India, bleeding balance sheets for two years since 2008 recession, the year 2010 has ended on a happy note to airline industry in India. The recovery is so spectacular that Indian aviation industry has emerged as one of the fastest growing aviation markets globally thanks largely to India’s excellent economic growth which is pegged at 8.75% for the current fiscal by the Government. With economic recovery in full swing, the consumer spending on travel too has gone up rescuing the airlines industry that was staring at bleak future not long ago. According to one of the aviation experts, 2011 will be much better with passenger traffic likely to reach nearly 60 million from 45 million in 2009.
Most of these loss making airline operators have left behind turbulent period of surging operational costs, excess capacity and unruly competition. Now they reach more domestic destinations hitherto unheard of besides targeting lucrative Gulf sector, Saudi Arabia in particular. The Gulf was the sole prerogative of the national carrier Air India a few years ago. But that has changed. Jet Airways, the private airlines for example, now flies to Manama, Doha, Abu Dhabi, Dubai, Sharjah, Kuwait, Muscat and three destinations in Saudi Arabia: Riyadh, Jeddah and Dammam. The Kingfisher Airlines, relatively new entrant in the overseas market, has introduced flights to Dubai from Mumbai and Delhi. “The challenge is to increase and retain the market share and the Gulf is the lucrative sector since one can take advantage of near full capacity all the time of the year. You get the international benefits for a flying time of just about three to four hours from India”, say sources in the Jet Airways. However, the competition on the international routes, particularly on the Gulf segment is expected to get stiff with entry of more private players such as Spice Jet and IndiGo in the near future as they too are on massive expansion mode.
Given the optimistic future, the Government has decided to infuse ailing Air India with INR 12 billion a few days ago. “This is the second bail out after INR eight billion given to them in February 2010. If AI cannot get out of its sickness in next few years, they will never”, says an aviation analyst pointing out that some private airlines have already turned profitable albeit in a small measure.
Despite the positives, all these airlines whether owned by government or a private operator, cannot take good prospects for granted. The price of crude oil which recently hit US$ 90 may spoil the party in the coming years.
Notwithstanding the controversy surrounding exorbitant prices charged by the airlines in India, bleeding balance sheets for two years since 2008 recession, the year 2010 has ended on a happy note to airline industry in India. The recovery is so spectacular that Indian aviation industry has emerged as one of the fastest growing aviation markets globally thanks largely to India’s excellent economic growth which is pegged at 8.75% for the current fiscal by the Government. With economic recovery in full swing, the consumer spending on travel too has gone up rescuing the airlines industry that was staring at bleak future not long ago. According to one of the aviation experts, 2011 will be much better with passenger traffic likely to reach nearly 60 million from 45 million in 2009.
Most of these loss making airline operators have left behind turbulent period of surging operational costs, excess capacity and unruly competition. Now they reach more domestic destinations hitherto unheard of besides targeting lucrative Gulf sector, Saudi Arabia in particular. The Gulf was the sole prerogative of the national carrier Air India a few years ago. But that has changed. Jet Airways, the private airlines for example, now flies to Manama, Doha, Abu Dhabi, Dubai, Sharjah, Kuwait, Muscat and three destinations in Saudi Arabia: Riyadh, Jeddah and Dammam. The Kingfisher Airlines, relatively new entrant in the overseas market, has introduced flights to Dubai from Mumbai and Delhi. “The challenge is to increase and retain the market share and the Gulf is the lucrative sector since one can take advantage of near full capacity all the time of the year. You get the international benefits for a flying time of just about three to four hours from India”, say sources in the Jet Airways. However, the competition on the international routes, particularly on the Gulf segment is expected to get stiff with entry of more private players such as Spice Jet and IndiGo in the near future as they too are on massive expansion mode.
Given the optimistic future, the Government has decided to infuse ailing Air India with INR 12 billion a few days ago. “This is the second bail out after INR eight billion given to them in February 2010. If AI cannot get out of its sickness in next few years, they will never”, says an aviation analyst pointing out that some private airlines have already turned profitable albeit in a small measure.
Despite the positives, all these airlines whether owned by government or a private operator, cannot take good prospects for granted. The price of crude oil which recently hit US$ 90 may spoil the party in the coming years.
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