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EQUITYMASTER AGORA RESEARCH PRIVATE LIMITED

The End of India?
WARNING: What you are about to rea !o" #$ %o!tro&er$#a'( a! )ay be o**e!$#&e to $o)e au #e!%e$+ Rea er #$%ret#o! #$ a &#$e +
Dear Reader, Imagine getting up one day and finding all your savings as well as your retirement money gone. Imagine discovering that you can't pay for your children's education anymore... that you're going to default on all your loan payments... and that the company you work in is about to go bust. Imagine seeing your house rent double, paying a fortune to fill up your car (if you can still afford it at that point), and buying vegetables for prices you earlier paid for lu uries. !oth you and I know many of these things are happening already. But mark my words - this is just the beginning, and the situation is about to get a LOT worse in the days to come.

"es# $e Indians are set to come face to face with the !I%%&'( financial threat in the recent times. )nd this threat comes *+( from any event happening elsewhere in the world, but from within our own country... operating in our towns, cities, and villages... right under our noses. (hat's right. +f late, we've been so obsessed with the happenings in the ,', &urope, 'yria, Russia and -hina that we have overlooked the things going on in our own country... and the massive threat they pose to our personal finances. !ut now, I'm going to reveal all about them to you. )nd not .ust that, I'm also going to tell you how to protect yourself from this threat and possibly even profit from it at the end. /owever, before we do that... 0lease understand once again that what I'm about to tell you now is controversial, and we even e pect a lot of angry emails from people after reading this letter. !ut this is something that will really have serious implications for your wealth and finances going forward. )nd that's why we decided to bring it to your attention right away, no matter what the conse1uences for us after we do that.

A Crisis Bigger Than Anything We Have Faced Before!
/i, I'm Rahul %oel, the -&+ of &1uitymaster... India's leading Independent stock research firm with over 2,343,456 members from 62 countries worldwide. "ou may know our company from the path7breaking research work we have done over the last 26 years. $e recommended buying (ata 8otors at the depth of the 9554 crisis when everybody

else thought the company was about to go bankrupt. (hose who took our recommendation ended up making 643: on it. $e told people to stay away from the Reliance 0ower I0+ which was one of the biggest and most popular I0+s to hit the Indian market. )s you may know, the I0+ turned out to be a huge disaster. )nd these are .ust two such e amples. Time and time again, our commitment to not be swayed by market emotions, and instead analyze hard facts to get the right picture, has helped !uitymaster become one of the most trusted research houses in the country today. ;ike one of our subscribers, ' R 'amratt, says...
"It's been 5 years since I have been a subscriber to all the products of Equitymaster (EM). EM's "power to people" approach is what made me to associate with them initially. EM's honest independent and consistent research on stoc!s is worth appreciatin". In short I must say it has been a "rewardin"" e#perience."

+r like another subscriber, Deepak )ggarwal, says...
"In $%%& Equitymaster was probably the only research house which will "ive most of '()* or +E)) recommendations rather than ,-. reports and everyone !nows what happened after that. I feel to be proud subscriber of Equitymaster seein" a"ain that you still are not afraid of "ivin" the ri"ht opinion irrespective of mar!et moods. /reat 0ob111"

)nd I'm telling you all this not to brag, but only so that you take what we are about to tell you now with utmost seriousness. ;isten, we believe we are heading into a phase where millions of unsuspecting Indians will go broke, and survival will become the one and only concern for all people. )nd the worst part 7 this is going to happen not in another < or 25 years, but in the very

near future# I know this may sound unbelievable right now. In fact, when we discovered this during our latest analysis of the Indian economy, even we hoped it would somehow turn out to be wrong. !ut as we checked the data, double7checked it and then checked it once again, our belief only grew stronger and stronger...

Is this the end of the road for the normal Indian?
$e believe the normal Indian is all set to be hit by a series of changes that will destroy his current way of life and push him into a state of helplessness and despair. "ou see, the Information (echnology boom and the all round growth of India that followed gave normal Indians something they seldom en.oyed before 7 surplus money to use as per their free will. (hey could splurge this e tra money on clothes, gadgets, cars or anything else. +r invest it in shares, property or do whatever they wanted with it. (his is what gave Indians a new sense of hope and security. (his is what led to the growth of the domestic economy in India. !ut this sense of security is about to be snatched away from us now. )nd we have = very good reasons for saying this... 2. "irst, the falling rupee and rising prices ha#e crushed the dreams of the rising $ndian middle class $e're afraid the days of owning e pensive smart phones, high7end laptops, ;&D (>s, fancy cars, overseas education and foreign vacations are fast approaching an end for normal Indians.

)s you know, the rupee touched an all7time low of Rs ?@ against the dollar recently, and still continues to hover around the Rs ?9 per dollar mark. %hart &' (cute )upee *e#aluation (gainst +, *ollar

+ource2 3eserve ,an! (f India (www.rbi.or".in)

In short, the rupee has lost around 2?: in 952=, and 33: in the last = years. $hat this means for normal people like us is that if we could purchase a laptop for Rs =9,555 when the rupee was at Rs 3< to a dollar, the same would cost around Rs 33,555 or more with the rupee scaling new lows. )greed that we can live without high7priced laptops, smartphones and ;&D (>s. !ut we can't say the same about petrol and diesel too, rightA 'ince Buly 9<, 9525 when the government decided to allow market forces to decide the pricing of petrol, its price has already increased by more than Rs 9<... )nd the price of diesel too has increased by around 25: in the last one year alone. (he rupee fall being one of the reasons for this. %hart -' "uel .rice $nflation - ,kyrocketed

. (ake a <557rupee note out of your pocket now. (hinking about sending your kids abroad for educationA "ou can forget about that also. you now ha#e to deal with the constantly-increasing domestic prices too.ust one part of the story. and getting only a fraction of what we'd get earlier.ust a few minutes it's gone. . If funding your kids' overseas education took Rs =5 lakhs earlier.... and in . increasing your monthly e penditure even more. (s if the problems from the falling rupee weren/t enough. )nd any further increase in fuel prices will automatically lead to an increase in the prices of milk. vegetables and other essential commodities too. )nd guess whatA )ll this is . (hat is what the ever7increasing living costs have done to us today...+ource2 4etroleum 4lannin" 5 6nalysis 7ell (Ministry of 4etroleum 5 8atural /as /overnment of India) 'o maintaining a car has already become a huge burden. the same will cost you Rs 3< lakhs now with the fall of the rupee. $e are paying much more for everything than we used to.

meat and fish too have gone up.$ +ource2 International Monetary 9und(IM9) (www..ust the first of our problems. &ducation has become e pensive. (raveling costs have risen. eggs. Then we ha#e the falling growth which has left millions of !ualified workers roaming on the streets without jobs "ou might remember the days when the economy was growing at over @.ust to keep our house running and meet our basic monthly e penses.. ) dinner for two that cost Rs <55 a couple of years back now costs Rs 2.ust 9 or = years ago. 9. )nd this is . Rather about .imf.<:.or") 'o this really leaves us worried about how much we'll have to spend in the future . /ouse rents have risen.)nd I'm not talking about 25 or 2< years ago. Cood grain prices have risen.rice )ise $n $ndia 2plained By %. vegetable prices have risen greatly.<55. 0roperty prices have risen. )s you know. &ven watching a movie in a theatre has gotten e tremely e pensive. +ur . (he prices of fruits. )nd the most shocking thing of all is that the price rise in India has been faster than that in other emerging countries too# %hart 0' 1ighest . in the last = years.

ob to another was considered the easiest way to increase your salary fast. %hart 3' $ndia/s *ecelerating conomic 4rowth .policymakers were e tremely optimistic of breaking the 25: mark very soon and kept telling us the best is yet to come. Business confidence in $ndia has fallen to an all-time low. students would get multiple . and hopping from one . (his led to a shortage of government funds for pro.obs were in plenty. the truth is India was doing e ceptionally well for a brief period during 95547 9525. 'o what really happenedA $ell.ects.ob offers even before they finished college. (nd many firms are now struggling to just co#er their interest payments. Cast forward to the present and the scenario is entirely different. followed by policy paralysis. (he falling growth has really hurt India as the number of . !ut the government then rested on its laurels. eventually leading to a slowdown in economic growth. )t that time .obs has gone down drastically.obs. and spent money on e travagant socialist schemes rather than on building infrastructure and creating . followed by private investments drying up.

It's a big thing right now if you can .ust hold on to your current .oin the workforce in India every year.plannin"commission.4 million new people .? < 4ro@ected "rowth +ource < 4lannin" commisson of India (www.obs are now seeing their salaries stagnate while their e penses keep going up continuously.<. the global credit ratings agency 8oody's also recently said. D(he days of 4 per cent %D0 growth are gone.$ < =uic! estimates $%. )s per the &leventh Cive7year plan.ob..nic.< per cent by the second half of 952<. !ut that's not all too.obs are unable to find any. $e e pect the Indian economy to hit its potential growth rate of ?.. people with . $hat will all those people doA /ow will they support themselves or be of any use to the countryA (o add to this.:$%.D 'o you can forget about higher salaries.><. )nd those without . around 29. =. Our penchant for importing e#erything could now put e#en the things we take for granted out of our reach .in) )s a result..

. you and I will be the ones paying the penalty for it.. during the &. )nd India imports nearly 45: of its crude oil re1uirement. *ow..in) (ccording to )B$. . edible oils and spices. we also have other imports like the necessary crude oil and our beloved gold. billion. while it is technically the government's responsibility to eliminate unnecessary imports. are imported and sold locally in IndiaA In addition to these. vegetables.. our imports have gone way past our e ports putting an e tra burden on our economy. our imports e2ceeded our e2ports by a whopping :.months up to 8arch -9&0.ercentage Of 4*. pulses.It's no secret that many mobile phone companies in India import phones from -hina and sell them here. %hart 5' %(* (s ( . !ecause of all these factors.tood 6orst $n "7&0 +ource2 3eserve .rbi. which can be easily produced or manufactured in India. fruits. increase e ports and maintain a healthy surplus.an! (f India (www. . India and -hina are the biggest consumers of gold in the world at present competing for the top spot. !ut did you know that even regular items like milk and milk products.or".<..

-DE .. make you give up your hard7earned money. 0lus. this is already happening# 8ost people . the government is now going overboard in their efforts to lower the country's import bill as 1uickly as possible. (he import duty on gold has been hiked = times since Banuary this year. you askA $ell.&DE 0lasma) as DfreeD baggage at the airports anymore. )nd banks have already stopped selling gold coins and bars.ust the beginning. But while all these things are ig concerns! none of them come close to the BI""E#T threat your finances face right now$ $ $ .. )nd frankly. and impose a duty on them. even more new ways will be invented to reach into your wallet. there was also a notification issued recently to *+( permit import of flat panel televisions (. making it costlier for the common man. we think this is . (he outcome of thisA . and erode your family wealth built over generations../ow. 6e now ha#e strong reasons to belie#e the go#ernment will be coming after 7O+) money to pre#ent the financial situation from worsening further and also keep funding their #oter-friendly schemes. )nd with the passage of time..ust don't realiFe it yet. and many more restrictions could be put in place in the days to come making lives difficult for all of us.isten. In fact. "ou may know that there was a proposal from the +il 8inistry recently to close 0etrol 0umps from 4pm to 4am to reduce the usage of petrol and diesel.

)nd this huge population. combined with the government's voter7enticing policies. either making our subscribers money or saving them unnecessary losses. )nd once you see them. it's no secret that India has always been a populous country. )nd we are doing the e act same thing again now. /ere's more. $e followed the same approach on numerous other instances before... . 6e are simply following the data and facts our research team has gathered to their logical conclusion.       It will slowly diminish all personal spending as well as saving (he economy will go into a limbo 8illions of families across India will be forced into hand7to7mouth e istence 'aving for children's education will become a nightmare !uying property and homes will be unimaginable for most people . 'o in this letter. we are certain you too will agree with what we're saying. have together led to a rapid surge in the country's debt in the recent years.nemployment will shoot up "our business or the company you work in will be forced to close due to lack of funds )nd the list goes on and on. we are going to present all the facts to you. Don't get us wrong 7 we are not saying all this to scare you. everything will be far worse than what we're already seeing. Why Indians should e %EA&&' worried$ $ $ . $rrefutable facts that are a#ailable for anyone to see in the public domain.  'imply stated.ook.

==5. )nd guess whatA ) siFeable portion of this goes into funding subsidies and other so7called voter7 enticing7schemes which give little in return economically.. (hat is the estimated e penditure of our government for the year 952=723 as per the ..!ut now the government's spending. 'ubsidies received by the people often make them laFy and dependent on them for ever b. 4o#ernment 6elfare 2penditure . and subse1uently our country's debt. !ut giving subsidies also has a lot of drawbacks. (here are malpractices and mismanagement in the administration of subsidies which leads to the subsidies not reaching their intended target or being siphoned off by somebody else midway d. 'ubsidies can become a bargaining chip in the hands of the politicians as we're seeing right now in India c.poilsport "or The conomy .. let's first take a look at all the welfare and subsidy programmes started by the %overnment and the e penditure incurred..nion !udget. subsidies are provided with the purpose of ensuring fair and impartial utiliFation of the country's resources. )s you may know. "es# (o understand the magnitude of this threat. are set to e plode and become a lot bigger.. a.. it places a financial burden on another person )nd I'm writing to you now to show you how the burden of paying for other people's subsidies is going to fall directly on "+.. very soon.->< crores. when a subsidy is given to one person.. Cor a developing country like India.. they can help improve the living standards of the poor by making the items consumed by them cheaper.. )s &.Biggest . )nd finally.

ust getting started.(/01 (hat's a total of Rs 2.e o* Pro-ra))e -rban and rural health pro"ramme 3ural employment scheme 7ompulsory child education pro"ramme 3oad pro"ramme to connect villa"es 7hild development scheme 3ural housin" pro"ramme -rban development scheme 9ree balance meal for children at school 3ural drin!in" water scheme Tota' +ource2 Ministry (f 9inance (http2CCindiabud"et. and the government simply cannot stop or reduce them drastically.>$ .5> R$ .-9 crores? )nd we're only .o@ana 0awaharlal 8ehru 8ational -rban 3enewal Mission Mid *ay Meal +cheme 7lean Bater +cheme Ty..% .5$ .. the -entral government also gives subsidies which the public has gotten accustomed to.o@ana Inte"rated 7hild *evelopment +ervices Indira 6was .@34 billion or )s &>3.. #u sidies that cannot e sto((ed Remember I told you how people can become dependent on subsidies foreverA .nic.?A . In addition to these schemes.inC) I! R$ b! >&> >>% $&> $.&& .Na)e 8ational 'ealth Mission Mahatma /andhi 8ational 3ural Employment /uarantee 6ct +arva +hi!sha 6bhiyan 4radhan Mantri /ram +ada! .

this subsidy is bound to go up e#en more in the years to come. this is one subsidy that the government cannot stop or even reduce drastically. 'o while we're paying around Rs 45 per liter of petrol now. there's a lot of hue and cry and protests demanding rollback of the hike. or if these ta components were lower.. the price could reach Rs 255 or more soon. 'o already. )nd this issue is so sensitive it has even led to political parties walking out of coalition governments. (hat's why every time the price of these fuels is increased slightly. vegetables and nearly everything else is linked to the market price of petrol and diesel. )nd in the future also. !ut here's the most shocking part. (he cost of public transportation.(he subsidy on oil is one such e ample.999 %rores a year on oil subsidy. the cost of daily use items. we are being charged a hefty amount for petrol and diesel in the name of ta es to fill the central and state government coffers. )nd the cost of this subsidy is set to skyrocket in the coming years. then petrol (or diesel) would have been a lot cheaper for us. some of this burden will be passed on to you as well. fruits. If we didn't have these. Cor many decades now. the Indian public has gotten used to getting petrol and diesel at subsidiFed rates. The go#ernment is currently spending )s =5. regardless of whether the international crude oil prices increase . But with the fall in the rupee #alue and increased usage.. 'o clearly. )nd naturally. )round =5: of the price we pay for petrol is comprised of >)( and e cise duty imposed by the central and state governments.

93.<: of our government's income. )nd given that this is an open7ended scheme with no end date. respectively. !ut economists of the %overnment's -ommission for )gricultural -osts and 0rices (-)-0). $e are also used to seeing politicians promise to give laptops. . to nearly ?6: of the population. /olding such large 1uantities in godowns will only lead to scarcity in the market. grinders and what not if people elect them to power. (he cost for the first year itself is pro. wheat and coarse cereals per month per individual at a fi ed price of Rs =.32. #u sidies for (olitics $e are pretty accustomed to seeing the government waive off farm loans and agricultural electricity bills worth millions before the elections. the cost of this bill is certain to go up even more in the future due to increasing population and other factors. pushing up their prices even more. "ou probably know that the Cood 'ecurity !ill guarantees < kg of rice. !ut the recent Cood 'ecurity !ill can be considered the most ill7conceived subsidy given with the election in mind in the recent times. 'econd. have put the cost over a =7year period at Rs ?.49. 9. which comes to a whopping 23...or the subsidies in India decrease.2?= crore.9?= crore.. you and I will be the ones asked to cough up e tra money for it.. wheat and cereals available at all times.69= crore per year. in order to implement this scheme properly. (he government estimates that the food security bill will cost Rs 2. who define the roadmap of agricultural policies in a research paper titled *ational Cood 'ecurity !ill 7 -hallenges and +ptions.ected at Rs 9. the government will have to ensure that it has large stocks of food grains. 2.

the 1uality of our storage facilities is also a big issue. %hart =' 4o#ernment . 'o this casts serious doubts on the government's ability to hold and distribute large 1uantities of food materials properly.arliament that fruits.)nd then.harad . (nd our "ood .. and it will turn out to be the last nail in the coffin of the Indian ta payer. grains and #egetables worth )s 33. which can lead to diversion of large 1uantities of these products to the black market.<3? tonnes of food grains was damaged between 955@725 and Buly 9529 in Cood -orporation of India (C-I) godowns.999 crores are wasted e#ery year due to inade!uate storage infrastructure. and force "+. )n R(I reply recently revealed that at least 26. In a nutshell. we also have our leaky and corrupt 0ublic Distribution 'ystem. )nd there are many more subsidies too. here's a list of subsidies that our government gives every year.rocessing 8inister ..awar has himself told . 'o we strongly believe the Cood 'ecurity bill is an improper and hasty move.astly. . !y giving Cood subsidy to two7thirds of the population.ubsidy 2penditure . to pay a lot more money in the form of ta es to support this bill. the bill apparently gives benefits even to the non7poor# (his will only make our budget deficits even worse.

.inC) 'o the 1uestion that really worries us is 7 if the subsidies keep increasing at such an alarming rate. billion in -9&0-&3. of the individual (o(ulation .nic..+ource2 Ministry (f 9inance (http2CCindiabud"et.nic. where is the money for it going to come fromA India) A country where *ust +. %hart <' Towering 4o#ernment . going from )s 3>> billion in -990-93 to )s -.00.L * in the last &9 years.inC) (nd this e2penditure has more than @+(*)+.ubsidy 2penditure +ource2 Ministry (f 9inance (http2CCindiabud"et.

.ust about =: of the total populationA 'o the truth about income ta in India is that many people don't pay income ta at all.ust =. superfast charges and (atkal . only 39.. the railways increased different supplementary charges like the reservation fee.ing overtime 8ost people don't realiFe it. 0 -hidambaram.455 persons 7 who admitted to a ta able income e ceeding Rs 2 crore per year. Or they understate or hide their income so that they can pay less ta2 than they actually ha#e to. They either make less than the ta2 e2empted amount in a year.< crore income ta payers in IndiaA $hich is . &ven though the basic passenger fares were left untouched. %ailway charges increased through indirect route) During )pril of this year. there's no guarantee people will pay it. $hich means that as the government e penditures increase and the revenues fail to keep up. but a number of new ways have already been devised and put into action to e tract more money from normal people. the e tra burden will fall mostly on the sincere and honest ta payers. the railways after many years increased the passenger fares through an indirect route.D 'o most Indians simply do not prefer paying ta es. +ur finance minister. stated in his budget speech recently that D(here are 39. Warning) The collection agents are already wor.(ays income taDid you know that there are actually .455 persons 7 let me repeat. )nd even if a new ta is levied.

if any at all. overflowing and smelly bins. In %oa. (he !ruhath !angalore 8ahanagara 0alike (!!80) has outstanding bills of Rs 2. 8ost of our municipal bodies are cash strapped. there was yet another increase in the form of fuel ad.charges. choked drains. and streetlights that don't work are common in any Indian city. roads full of potholes. (he (imes of India. we stand to lose more when we cancel also. Cor instance. )nd since cancellations are also certain to happen for different reasons. the 0ana. 952=. 0lus. 'o this will help the railways revise passenger tariff regularly. it was decided that the final ticket charge would be in multiples of < only. /unici(al odies increase (ro(erty ta. people like us now ha#e to pay more as the charges for e#erything else ha#e been increased..ust pay their employees' salaries. (hen on +ctober 6th recently. )nd even the cancellation fee and clerkage charges were hiked. )nd the reason for this is the same in most cases.o e#en though the basic fares had been left unchanged on the paper. struggling to . . )nd the list goes on and on.to oost revenues) -haotic traffic. and spend minimal amount on development work.ustment component (C)-) which would be revised every ? months going forward.=55 crore as on Buly 2@..i -orporation depends entirely on the government for staff salaries and other e penses. as reported by leading news daily.. .. making your ticket charges go up every ? months.

. !ecause of C'). and paid the full bill amount for it subse1uently. consumers received inflated monthly bills when they were already cash7strapped due to constantly increasing prices.. (he )urangabad 8unicipal -orporation ()8-) is planning to introduce value7based property ta system in the city as it would get them higher revenues.o the municipal bodies in many towns and cities are targeting local residents with higher property ta2es not for de#elopment. (he 0impri -hinchwad 8unicipal -orporation (0-8-) in 0une aims to increase its revenue from property ta . water ta and building permission departments.. (his e tra component in the bill is called the Cuel 'urcharge )d.. the overall ta cost borne by the purchaser of a new apartment including service ta . Imagine you used G units of power in a month. (hat is e actly what the )ndhra 0radesh &lectricity Regulatory -ommission ()0&R-) has done time and again. to obtain enough money for their salaries and pensions. the electricity authority comes back to you and says the monthly bills that year did not consider the actual cost of fuel..ustment (C')).) (he 0ower -ompanies in )ndhra 0radesh came up with a new way to e tract more money from power consumers. (hen after 9 or = years. but just for their sur#i#al.. In (hiruvananthapuram. "es. and hence they will be collecting that additional fuel cost from you in your upcoming bills. stamp duty and ta on purchase value of the apartment ranges anywhere between 9< per cent and =5 per cent of the apartment cost. >)(. in contrast to the property ta collected based on the carpet area irrespective of the location the property... . 0ower com(anies charge e-tra ill for electricity used 1 or + years ac..

(nd it has been reported by The conomic Times that many restaurants unknowingly le#y a ser#ice ta2 on the entire bill amount. 'o in other words. non-agricultural consumers now. service ta is levied on e penditure and is applicable to everybody. the government also added another thing to this list which was not taken too well by a lot of people. instead of on 39B of the amount like they are supposed to. +ver the years. )nd this is not .!ut many people think the C') is actually being used to cover up various other costs. $e are currently paying service ta es on almost everything from mobile bill to broadband bill to hotel bill and so on.nlike income or wealth ta es which are payable only if you have income or wealth. you'll be paying fuel surcharge even for the power you did not use# #ervice ta-es on eating outside) .the fuel surcharge for the Afree powerA gi#en to farmers earlier will also be borne by other general. (he power companies in /aryana are also following the same approach. their restaurant bills started going up. 'o for those who en. the rate of service ta has increased from <: to 25: to 29:. (his often led to a situation where people were paying bigger bills than they were re1uired to.ust the case in )ndhra 0radesh. . (his was service ta on eating outside in air7conditioned restaurants. (nd the worst part .oyed eating out during the weekends. administrative inefficiency and lack of planning to tackle the continuously widening demand7supply gap. plus a 9: Deducation cessD and a 2: Dsecondary and higher education cessD. !ut very recently.

. In addition. #ehicles. business people are re1uired to provide details of their assets and liabilities while filing their income ta . the import duty on set7top bo es was more than doubled to 25 per cent. 'o even though this makes the set7top bo es costlier. shares and securities. the entertainment ta2 on tickets up to )s -59 is 35B of the gross ticket #alue.)nd there's more. /ore ta-es right from the time you start to ecome rich) 'tarting from the C" 952972=. jewelry and paintings. . the government has also allowed theatre owners to collect Rs 22 as service charges on all tickets. and different states charge different amounts. buildings. $n 8aharashtra for e2ample. insurance policies. 'o this will only make entertainment more unaffordable for the common man. 6hereas for a ticket priced abo#e )s 599. the entertainment ta2 becomes 53B. )nd one of the big reasons for this is the entertainment ta on movie tickets. )nd at the same time. up from Rs ? earlier. e#en professionals who earn more than )s -5 lakhs in a year need to mention all their assets including land. people have no option but to comply and buy them. cash ad#ances.. (his ta falls under the purview of the state governments. the Indian government has also made digitiFation of cable connections mandatory in the 3 metros to bring in more revenues. $n fact. )part from this. bank accounts. Higher ta-es on entertainment) $e have already seen ticket prices in cinema halls and multiple es rise significantly in the recent times. sending cinema halls and multiple es into losses very soon. not just business people.

(here's a 2: $ealth (a if the market value of certain assets e ceeds Rs =5 lakhs right now. the government is thinking about levying a 25: ta on dividend income in e cess of 2 crore. %etros(ective ta-ing of com(anies) -oming to the companies.ondon Increasing ta rates will make people evade ta es and help fuel the black economy. )nd since rich people receive substantial income by way of dividends from shares and mutual funds.obs and brings in more ta es in the country 0rofessionals and people with money may consider relocating to low ta domiciles such as 'ingapore... /owever. >odafone ac1uired assets belonging to /utchison $hampoa in 9556 for about H22.. you will be called to do so later. .9 billion to become the third7largest mobile network operator in India.ntil now. thereby taking more money out of the system instead of bringing into it   !ut still. if your career graph is heading up. these dividends were ta 7free to the investor as the company distributing dividends pays a dividend distribution ta at the rate of 2<:.(he purpose of this is to increase D$ealth (a D generation. Dubai or .. many e perts feel levying higher ta es on the rich will only do more harm than good. . "ou may already know about the popular >odafone retrospective ta ing case. be prepared to pay more because the government feels it's the best way to boost their ta revenues.  It will discourage entrepreneurship which creates more . If you've provided details of certain assets in the I( form. but haven't paid the $ealth (a for any of them. 'ome of the negative effects being.

.is shielded from this money collection dri#e of the go#ernment. India had at its disposal what so many countries could only dream of 7 a large number of people in the working age group of 2<7<@ years. Coreign companies are now thinking many times before purchasing a stake in an Indian company or coming to India to do business. even though this transaction happened outside India.< billion in capital gains ta as per &rnst I "oung.. the Indian government insisted that the transaction involved the sale of Indian assets. they realiFed the actual truth.. (hen what can a normal working person do in a scenario like thisA &specially at a time when the entire future looks uncertain. !ut then. India2s iggest advantage$ $ $ destroyed! Cor many years. the government also issued a retrospective ta amendment 7 dating back to 2@?9 7 in order to catch the >odafone deal and others like it. . India's biggest liability had become its greatest asset.*ow. *ow the Indian government can probably be e cused for demanding capital gains ta as the transaction involved an Indian company. and it has caused severe distrust in the business community..o nobody . and hence >odafone has to pay H9. )nd this number was only going to keep increasing for 1uite some time to come. that was a really bad idea. !ut issuing a retrospective ta amendment..be it the normal people or wealthy folks or companies . In addition. 'o suddenly. economists and policymakers around the world believed that India's huge population would be an obstacle to its growth.

'imply put. (he I( industry grew in India buoyed by the availability of large number of cheap.)nd this asset is what we call AThe *emographic *i#idendA.the B)$% economies . 0eople all around the globe were e tremely confident about India's prospects. )ussia.. and normal people could afford to save more and spend more. %oldman 'achs made the following statement. economies taken together could be larger than the 4= by -90>A (his statement literally opened the floodgates to foreign investments in India. -oupled with increased spending from the Indian government. and therefore to higher %D0 growth. $ndia and %hina . )nd as the number of dependents decrease. educated. 'alaries shot up rapidly.. the demographic dividend is the rise in the economic growth of a country due to increase in the number of working age people in the entire population. in its article titled DDreaming $ith !RI-sJ (he 0ath to 95<5D. . The B)$% could become a #ery important source of new global spending in the not too distant future. AO#er the ne2t 59 years. I(.could become a much larger force in the world economy. contributes to higher investment. Brazil. services and a lot of other industries also got a huge lift. &nglish7speaking workers. (he stock market took off. The B%IC re(ort of 133+ and the ra(id surge in false e-(ectations$ $ $ In +ctober 955=. then B)$%. (he demographic dividend claim gained a lot of credibility during the 2@@5s. manufacturing. !ecause of this. the working population saves more. you have a larger number of people working to support a smaller dependent group. and so did real estate and a lot of other industries.

human resource. The go#ernment has to find ways to make use of them producti#ely. (ake the case of a security guard sitting at an )(8. India needed to put certain mechanisms in place to make the most of its demographic dividend. (he capital re1uirement per worker in India was less than that in the developed economies. as with any natural resource... in contrast to -hina. (here was a possibility of employing technologies used elsewhere but not yet in use in India to achieve rapid growth c. )nd then.. there are people who have D.obs. but the reality is something totally different.. "ailure C&' $ncreased labor supply not e2ploited fully Dust ha#ing more workers will not do anything for the economy. &ven educated youth with all the re1uired 1ualifications are either .obs... nor able to contribute to the . !ut in India. But this is where India has failed adly$ $ $ (here are 3 areas where the government has failed miserably in tapping the demographic dividend advantage...ob but unable to do anything about it. he is neither able to make ends meet. or in this case.. )nd on top of that.'ee. thus giving higher returns on the money spent b... $ith his salary. )nd what placed India in a better position was that it had the largest percentage of young people.. which was dealing with a great number of elderly people due to their population control measures and other issues /owever.. bored and de. he gets paid a pittance to show for it at the end of the month. 4729 hours at a stretch.obless or working in below7par . /e sits there every day (or night)..obsD in the literal sense of the word. there are millions of people with no . there were mainly = things in favor of IndiaJ a.ected with his .

leading to better healthcare and education for the children as well. few new . many pro. .. !ut again. people find it possible to save more leading to growth in the overall capital in the economy. "ailure C0' $ncreased human capital migrating to foreign countries )s education rates rise. 0opulist schemes doled out ta payer money as if it grew on trees# )nd because of this.ects got stalled..obs throughout the country. If anything.economy in any way. "ailure C-' $ncreased capital used up in distributing freebies )s the number of dependents decreases. 1owe#er.    (emporary workers who are the least paid and first to get fired )gricultural laborers who work in numbers greater than re1uired on a single task 8*R&%) (8ahatma %andhi *ational Rural &mployment %uarantee )ct) workers who get work for . )nd lesser number of children at home means parents can invest more resources per child. 'o this is India's second failure.obs were created. the government faced severe scarcity of funds. in $ndia it has been the e2act opposite with the go#ernment splurging money on subsidies instead of on building infrastructure. and the result is there for all of us to see now. we even have more educated women contributing to the workforce. the government has to find ways to make good use of this increased capital to boost growth and productivity.ust 255 days a year out of =?< days# 'o this is India's first failure. he will depend on the government for more subsidies and handouts# )nd there are literally millions of people like him employed in odd .

and thereby a demand for different types of products and services in the domestic market. what we are seeing in $ndia is that despite increase in demand for #arious products. But because this has not happened. the important thing again is that the government should find ways to make use of this increased human capital by providing them good opportunities in India itself. this doesn't help the economy in any way at all. and it is India's third failure.esser number of dependents coupled with higher salaries brings about an increase in the disposable income. many educated $ndians are choosing to lea#e $ndia and work abroad in countries like the +. as they can find more jobs matching their !ualifications and also higher salaries there. )gain./owever. and the +E. Lack of education' . Why millions in India will continue to suffer$ $ $ *ow there are = main things stopping us from making the most of our demographic dividend. a. "ailure C3' $ncreased domestic demand trampled by rising li#ing costs .. people are opting to delay purchases and in#estments and cutting down on their spending due to the constantly-increasing cost of li#ing.. )nd given that these are not something you can rectify overnight. 'o this flight of talent is proving to be e tremely damaging for India. because the benefit of demographic dividend can only be obtained when people save more and spend more in the economy. 1owe#er. the impact is bound to be felt for 1uite some time into the future. 'o not being able to control rising prices to enable greater consumption is India's fourth failure.

'o unless the government finds way to improve the manufacturing sector. )nd it straightaway casts a serious doubt on India's demographic dividend claim.obs where their potential is not fully e ploited. $n -99.... b. the sad truth is that the manufacturing sector has simply failed to take off in India.*&'-+ in its &ducation Cor )ll7%lobal 8onitoring Report finds that India still has the highest number of illiterate adults in the world. India alone will have a shortfall of some 42 million literate people#D 'o lack of education forces people to take up odd . the world will be less than halfway towards this goal by 952<. 8anufacturing jobs few in number and decreasing' %iven that ma. /owever.D $hile also adding. . DIn rural India.)s per the 9522 stats. Lack of skilled workers in the ser#ices sector' . the role of the manufacturing sector becomes e tremely important.. )s per a leading news daily. )nd then the demographic dividend thing will then be of no significance at all. when the economy was at its peak. the manufacturing sector's contribution to the %D0 is around =5:. (he report says.@< million people in India do not possess even the minimum basic education and can be considered illiterate. India will have trouble employing millions of unskilled and uneducated workers. c.ority of the people in India are unskilled and uneducated.ust 94 per cent of grade = students could subtract two7digit numbers and only a third could tell the time. 969. the 8anufacturing sector contributed about &9B of $ndia/s 4*. $hereas in -hina. D+n current trends. .

!oth of them a far cry from the 25: growth India was looking to hit at one time. the situation is bad and the chances of turnaround look grim India Inc Confidence At An All4Time &ow$ $ $ Citch Ratings recently cut India's growth forecast for the financial year 952=723 to 3..= : from the ?.er#ices %ompanies. 'o.oftware and . But according to results from assessment tests administered by the Fational (ssociation of . there's a severe shortage of skilled and educated workers for the services sector. graduates and above comprised a mere 25 per cent of the overall workforce in 955?756. !oston -onsulting %roup (!-%) prepared a report for the -onfederation of Indian Industry (-II).ected earlier. )nd even the 0rime 8inister's &conomic )dvisory -ouncil revised its growth forecast for this year to <. in which it states that diploma holders.. <5B of technical graduates and more than .4 :. even the growth in the services sector has started to fall now and we are facing tough competition from other countries like 0hilippines...It's no secret that the 'ervices sector contributes more than half of India's %D0 right now. )nd there's more too.3 : pro. a trade group. )nd for this reason. .5B of general graduates are unemployable by $ndia/s high-growth global industries. 'hocking. vocationally7 trained workers. In a nutshell. including information technology and call centers. isn't itA )nd there's more.

India's youth unemployment 7 as a percentage of the youth work force 7 was @..=: for females in 9525.ob. as the falling rupee has affected their input costs and lowered their profitability. e#en though o#er 39 million people are registered in employment e2changes. $e have seen hundreds of candidates attending an interview for one . 'o the employment scenario on the whole is very bad. )nd ?6: of the participating companies said that they do not intend to hire in the near term and their workforce is e pected to remain at the current levels. )s per the latest $orld Development Report by the $orld !ank in 9529. only 9.ob situation are bleak. (his shows that the chances of seeing a dramatic improvement in the .@: for males and 22.obs with salaries matching their 1ualifications. It was discovered that the business confidence has fallen to the lowest in 26 1uarters.(he Cederation of Indian -hambers of -ommerce and Industry (CI--I) recently conducted a survey among companies to know what they thought about the current scenario in India. $e have seen companies struggling to find candidates in a country with millions of workers. . $e have seen 1ualified candidates not being able to find . )nd it will lead to a scenario where = things are almost certain to happenJ 5o 6o s) (ccording to another sur#ey jointly conducted by "$%%$ and rnst G 7oung.million get jobs e#ery year. It's true. (he participating companies were not too optimistic about the near7term performance.

"ov.ob creation. %hart . every 2 in 25 among the Indian youth is unemployed# )nd the government can now blame the current economic conditions for the lack of . /ave a look at the chart below.obs when the economy was booming. whereas during 95537955@ the %overnment created ."ov.obs are casual or low 1uality . !ut as per (he 8int.obs. the e isting employment numbers are nothing but an illusion.' *estruction of @uality Dobs *ata +ource2 /overnment (f India (http2CCdata.In other words. $hereas the remaining 65: .obs or widespread unemployment lurking in India.ust 9.6 million . )nd if the government couldn't create proper .obs when the economy was doing a lot better.in) 'o the 1uality . the chances of that happening now are indeed very slim. the %overnment created ?5 million .obs.D Costly food) .obs. while during 2@@@79553. )nd besides the lack of .in) M(+4I (http2CCmail.mospi.obs created per year stand only at little more than =5: of the total .

eggs. food prices in general rose by 2<6:# %hart >' )ising "ood .+nion prices touched an all7time high of Rs 45 recently.in) 3eserve . )nd onions are not the only ones that have become costly. 'o this has led to a situation where families are forced to stop eating certain food items to manage within their family's food budget.an! (f India (www. sugar and even salt have all doubled or nearly doubled in price since 9553.rice $nflation +ource2 Ministry (f 7ommerce 5 Industry (eaindustry. 8ilk. fruits. . the onion prices have risen by a whopping <92:A 'o you're now paying ? times more for onions than what you used to pay in 9553.or". things are going to get a lot worse. !ut did you know that since 9553.in) 'upply shortages coupled with hoarding have led to vegetable prices shooting up by =<5: in the same period.nic.rbi. )nd in the years to come. !etween 95537952=. Rice and wheat have gone up by 2=6: and 226: respectively.

an organization which collates real estate data from across the world. .roperty 4uide. (ccording to data from the 4lobal . 2.. rent control laws and development rules that restrict housing supply in the large cities have ensured that the house prices keep going up and up. rising incomes. (raditional Indian society encourages home ownership 9. saving the initial amount for a home loan itself will take 8)*" years with the prices of everything increasing continuously..ust in the past 9 years. (he home prices in Delhi alone have risen by ?5: . *ow there are = reasons why Indians have continued to buy real estate despite the high prices. (hink about it 7 if an apartment is going to cost Rs ?5765 lakhs. the compensation for the land must be 3 times the market value in rural areas. %ood returns from real estate have attracted speculators and *RIs looking to flip homes for an easy profit !ut given the rapid surge in home prices these days. -hennai.and bill recently which will push up the prices even more. )ccording to this bill. /igh inflation has made real estate and gold more attractive than financial assets =. 'o the real estate developers will automatically pass on this increase to you. 8umbai and Baipur too have risen dramatically. rapid urbaniFation. $ndia has witnessed the sharpest increase in real estate prices in the last couple of years.7nafforda le housing) +ver the years. )nd the prices in !angalore. and 9 times the market value in urban areas. )nd the worst part is that the government has also introduced the new . buying a home is set to become impossible for normal folks in the near future.

and your personal prospects also don't look too good. which is e1uivalent to around Rs 9< lakh in today's money.R money when the prices of everything are increasing continuously and the situation is already very bad.5B. $hat's more. the main worrying thought like I said.6<:A 7es. they could decide to directly hike the income ta rates by a big margin. $hat you should be worried about is of this happening when the country is neck deep in all sorts of problems. 8nce A Hot 9estination! 5ot #o Any /ore! $hen the %lobal -risis hit in 9554 and the entire $estern world sank into a recession.ust that. India was relatively shielded from its impact. .ust Rs 9 lakh. the overall atmosphere in India. the peak income ta rate was @6. (nd additionally./owever.o the /effecti#e/ ma2imum marginal statutory rate was ><. when all the options run out. this peak rate became applicable at . the government is already using not7so7direct routes to make you pay more. there was also a surcharge at the rate of &9B. the prospects for career growth and .<5B. ma2imum marginal rate of ta2 was . In the future. 'our ta-es are a out to get igger! much igger! Did you know that the entry level income ta rate in 2@4<74? was 9<:A )nd did you know that during Indira %andhi's DsocialistD phase in the 2@65s. is of the government coming after "+. 'o what's the guarantee that the government won't go the same way againA )s we have showed you. *ot .

the scenario is entirely different. and life in general has also become worse. )s per a news daily. !ut today. (he growth of the economy has almost halved. CIIs collectively hold over 35: of the outstanding free float in Indian markets. )nd even multinational companies sent some of their e ecutives to India to build and improve their business here. 0lus. (he Coreign Institutional Investors (CIIs). whose behavior is an indication of what the world thinks about our economy.ob security. 'o when they sell.and India Infoline have decided to close their retail broking businesses because the number of people investing in the markets keeps falling continuously. (his clearly shows a change in sentiment with regard to India among foreign countries. what's even more worrying is that even the domestic investors have lost interest in the stock market. = out of 3 young Indians feel the economy is worse than after the 9554 global crisis. India has serious problems.ob7hunting. people are unable to find good . . In addition. between Dune and (ugust -9&0. and also internally in India among the residents. (nd according to news reports. *early ?5: are postponing decisions like buying a car or a house or starting a family. have e ited the market in droves in the last couple of months.obs. -ompanies like /'!.obs and moved back to India. (his was the reason why many *RIs 1uit their foreign .everything else also simply looked comparatively much better. $ndia saw its sharpest bout of "$$ selling since the global financial crisis. more than <5: said this is the worst time to go . a recent -II7&( survey showed that confidence levels of young Indians are probably the lowest in the 957odd years since 2@@2.. )nd more than 35: said they would gladly take a pay cut if it improves ..

D!anks' first . . (he balance7sheet of the company (borrower) has to be checked properly before conducting a credit appraisal. .D (he best e ample of this is Kingfisher )irlines.. think again. !ut when it comes to corporate borrowers. !ut there are many other companies like it too.)s a result. $e don't e pect it (from any of the banks). which owes nearly Rs ?.ust appears to be heading south. and loans to impoverished state electricity boards 7 all of which are political decisions that make little economic sense.ook... (hen we have the e amples of agriculture loans and their subse1uent waivers. bad loans and restructured loans comprised an estimated 25: of total bank credit at the end of C" 952972=.. which has now led to a significant rise in bad loans. according to R!I. a normal Indian. a few months back came down hea#ily on bankers for lending to corporates recklessly.<55 crore to banks and financial institutions. Even your savings are 58T safe If you're thinking that you have lakhs of rupees saved in your bank accounts and your family is safe. many people who moved back to India in 9554 with big e pectations are now going back to the $estern -ountries as they can get a better standard of living and a more evolved corporate life there. )aji# Takru. it's a totally different story.. $hereas in India.ob is to protect the deposits of the account7holders who place their hard7earned savings with the bank. (here is no scope for reckless lending.. 'o the banks are left with no option but to DrestructureD these loans and give easier repayment terms in order to avoid losing the money completely. )nd because of this.. /e said. which are responsible for three71uarters of all bank loans. it's no secret that a retail borrower. everything .. has to make his life miserable to ac1uire a loan of even Rs < lakhs from a bank. India's state7owned banks. The banking and financial ser#ices secretary.

including the very recent hike on 9@th +ctober. the biggest government7run lender.D But you can/t help but ask .an. Keeping all this in view. "es.. 952=. falling rupee and stuttering growth. the new %overnor of R!I. D(he need to anchor inflation and inflation e pectations has to be set against the fragile state of the industrial sector and urban demand. and thus had a demoraliFing effect on India's competitiveness.an said in his mid71uarter policy review statement. set out to deliver his maiden monetary policy. %hart &9' $ndia/s roding 4lobal %ompetiti#e $nde2 . Ra.if increasing interest rates could curb inflation effecti#ely.. )nd in case of 'tate !ank of India. economy and growth. the proportion of restructured loans that has become non7performing has risen to 9?: as per '!I's 1uarterly results# %BI totally hel(less$ $ $ $hen Raghuram Ra. he was faced with = big issues 7 high inflation. bringing down inflation to more tolerable levels warrants raising the repo rate by 9< basis points immediately.contain an overwhelming 1uantity of bad loans. +n the contrary. !ut the inflation shows no signs of abating. 8any restructured loans are now turning into non7performing or bad loans. why hasn/t it been successful so many times beforeH (he R!I has hiked interest rates numerous times in the last = years. /e chose to keep the inflation under check by increasing the interest rates. see this chart. repeated hiking of interest rates has made money harder to get both for individuals and companies.

India's competitiveness rank C&.. which were sufficient for imports for 2.weforum. 'o it's clear that R!I measures can do little in isolation to improve the economic situation of our nation. (he foreign e change reserves. $hat we need is reforms and government action that would help in alleviating concerns of the Industry. it seems that the government is least interested in worrying about any of these things. the slowest growth in a decade and the persistent high inflation 7 all signal to a dooming economy... from 3= in 955?756 to ?5 to 952=723.. )nd that is why this could be the most serious situation we're ever faced.+ource2 the Borld Economic 9orum (www..< years during . Are 'ou %eady For The End of India? (he fall of the rupee.or") $hile -hina's competitiveness rank improved from <3 in 955?756 to 9@ in 952=723. !ut with the general elections close at hand.

are now estimated to serve imports for only about 6 months.or". %hart &&' *omestic *ebt Burden $ntensifies +ource2 3eserve . )nd the vote7bank7friendly schemes like the Cood 'ecurity !ill further burden our economy at a time when our oil import bill is already touching the skies.an! (f India (www..in) (hen our foreign debt too has ). our domestic debt has D+. The truth is that our domestic and foreign debts are already at all-time highs.0.. %hart &-' $ndia/s 2ternal *ebt Burden .!..rbi.&D since 9556754. Cirst.&D from 955= to 952=.8+'( L..)DR..9556754.

the go#ernance in $ndia has gone from bad to worse.o simply stated. the normal Indian is at a serious risk of watching his entire way of life as well as his livelihood getting wiped out. !ut like I said. !ecause of this. India gets decimated. the situation is not very good. . . !ecause it is the normal Indian who keeps our economy running. )nd when the normal Indian gets decimated. Here2s (roof$ $ $ M )eal estate properties remain unsold in many cities Increasing prices and the falling economy have led to properties going unsold in many cities.rbi.+ource2 3eserve . what's even more scary is the government's newfound aggression in going after people's money.an! (f India (www.in) 'o clearly. (nd the $ndian 4o#ernment has made life so miserable for the normal people that they might actually ha#e to think about shifting to the 8oon? $e call this scenario the &nd of India.or".

are now unable to cope with the &8I payments. The o#erall layoffs in the industry are estimated to be o#er &5. $hereas today. )uto7component makers are cutting staff to stay afloat during the tough times.6 per cent decline in new car sales in the same period.(ccording to property research firm Liases "oras.999. we have several car makers offering huge discounts and attractive offers. the sale of consumer goods . !ut still. who had invested in real estate some years ago.. M %onsumer goods sales at a &9-year low (s per the market research firm. 'o there's no doubt that the deepening economic slowdown has hit the real estate market hard. there's nobody to buy the cars. )ccording to a survey. in the last si months the real estate resale inventory has increased nearly =5 per cent. 8any carmakers are delaying the launch of their new plants. )nd not . Fielsen $ndia. and are putting up their properties for sale. close to =<9 million s! ft of real estate is lying unsold with de#elopers currently. the increasing interest rates and the economic slowdown have hit the automotive sector hard too. -learly. India's leading passenger car manufacturer. the fre1uent and steep increase in fuel prices. had to close down 9 of its plants for a day to prevent stock from piling up when the demand is low. )nd the used car segment has witnessed a 9979< per cent rise in sales during )pril7Buly 952= compared to a @.ust that.. many salaried professionals. 8aruti 'uFuki. M (utomoti#e sector skating on thin ice (here was a time in India when buying a new car took around 24 months and car makers were also few in number.

)ccording to -ompany managements. the lowest in the last 2? 1uarters. are ending up . my point here is.. )nd that's why we say 7 (he &nd of the *ormal Indian is actually the &nd of India itself# What2s li. I can really go on and on about this. (he slowdown has been greater in the urban areas due to higher price rise there.in $ndia fell to a &9-year low recently.obs losses. !ut the impact has been felt in the rural and other areas too.obless today. )nd the domestic revenues of Indian C8-% players grew at .. we will have even more people wandering on the streets without work and without anything to do. (nd now. )s a result. (he death of the domestic economy# )nd what impact will this have on the societyA a. this is due to people making deep cuts in spending because of high inflation and consumer sentiment that things might get a lot worse. 8any educated people. )nd as they . $t is in#estments and spending by the regular $ndians that keep the country running..ely to ha((en in the near future$ $ $ )bsence of personal spending can only lead to one outcome.ust these = sectors. )nd with further . and even post7graduates. the regular $ndians are being left with no money to spend on anything other than their sur#i#al.. even discounts and price cuts are not lifting sales much now. )nyway.@: in 'eptember 952= 1uarter. $ncrease in crimes' $e're already seeing an increase in all types of crimes in the country today. )nd this isn't happening in .ust 22.

and it can definitely happen again. and monuments such as the 'tatue of . $ndia as a democratic nation will fail' $hen the situation goes completely out of control. the maintenance work will take a severe hit. or fulfilling their own selfish interests as evident from the numerous scams we have seen. e. !ecause of this. )s the situation gets worse. government services were slashed. there is a lot of discontent and helplessness among people with the way things are going on in the country right now. It has happened once before during the Indira %andhi regime. (hey are busy either doling out freebies. . it will lead to social unrest and fights on ma. streetlights that do not work and choked drains will become a commonplace. +nly the essential services like 8ilitary. the government will be left with no option but to recommend an &mergency in the country. Loss of trust in the go#ernment' 8any Indians have already lost trust in the government because they rarely do anything that benefits the normal people.or and minor issues and scuffles over the country's resources.o this will lead to both. . c. museums. the nd of the Formal $ndian and also the nd of $ndia as we know it.555 government workers were sent home on unpaid leave. it will e asperate the common man even more and lead to an open revolt. 0ostal.say.iberty. +verflowing bins. (he . turning even the nicest of streets into slums. D)n empty mind is the devil's workshop#D b. 'ocial security. Ficest of streets turn into slums' $ith many local bodies surviving entirely on government handouts.' government shut its non7essential services as its new budget could not be approved by the last date and the government ran out of funds. 7# shuts down! India to follow suit? I'm sure you've heard of the 'hutdown in the . roads with potholes. national parks and Foos were closed.ocial unrest' )lready. around 455. 8edicare and a few . d. )nd as the situation deteriorates further.' recently.

. $e have already seen political attempts to block CDI in retail. stifling industrial .. a battle to gain the upper hand between two political groups. !ut that is something we see every single day in India. what if a political deadlock one day leads to a shutdown in India alsoA +r what if the government simply spends so much in a bid to boost its popularity that the treasury becomes near empty and recovery impossibleA We may not want to elieve something li. meeting essential financial commitments like mortgages and credit card payments became a big problem. which in turn led to slowing down of the domestic economy. )fter this came the ill7conceived . delay in clearances to numerous pro. and the list goes on and on.and )c1uisition bill which will make the process of ac1uiring land for business a longer and way more e pensive process. the government launched the improperly planned Cood 'ecurity !ill that will literally cost a fortune to implement every year and distribute subsidies even to those who don't need it.e this can ha((en! ut it is more li. a political party backed agitation against allotment of land to (atas in 'ingur. shutdown was the outcome of a political warfare. Fow what we need to understand here is that the +. political wars in Indian politics have only created more and more roadblocks for the economy and the industry. 'o.ects for political reasons.. isn't itA In the last few years. $idespread unemployment and not getting paid on time meant that people could not spend as much in the shops. )nd naturally.ely now than ever efore$ $ $ +ntenable projects and unproducti#e e2penditures are pro#ing to be the bane of the $ndian economy right now. Cirst..others were continued.

555 crores for this financial year. there are a few 1uestions you need to ask yourself..3=3 crores. it/s #ery much likely that $ndia could ha#e a shutdown of its own due to running out of funds? It's impossible to know e actly when this might happen. (hat's why our Cinance 8inister is now looking to push subsidy cost of H2< billion into the ne t year's budget to keep the fiscal deficit at 3. (he government has set a disinvestment target of Rs 35.. If that is already the case now. (otal ta collection during the period )pril7)ugust 952= was Rs =. (he government aims to contain the fiscal deficit (e penditure 7 income) at 3.+( of debt. at the current levels of spending. and the year after that. !ut at the current e penditure levels. we frankly don't see how that's possible. That2s why you need to e fully (re(ared$ $ $ *ow. 'o we see a . !ut all it has managed till now is Rs 2.o simply stated. .+( of e penditures ahead and a . then what about ne t year..2 trillion.4: of %D0. !ut like I said. it was the announcement of the setting up of the 'eventh -entral 0ay -ommission (-0-) to increase the salaries of around 45 lakh government employees and pensioners in India. which is 9<: of the budget estimates.growth and investments even more. )nd finally as per a news report of the &conomic (imes. )t least not directly. when the subsidy e penditures will only keep going up and upA . it could be sooner rather than later.4: ahead of the elections.... if the current le#els of spending persist for some more time. but hardly any income sources that India can rely on.

many people felt that it was an attempt by the desperate government to usurp the temples' gold reserves built over hundreds of years. .. $e have found that if you're willing to do some very simple things. you can not only protect what you've got from this threat. isn't itA (hat's e actly why you need to be prepared. a few weeks back the )B$ sent letters to some of the country/s richest temples asking for details of their gold. )nd if the government can go after the gold in temples.. 'o is there anything you can do to protect your money when things really get badA )ctually.R money in a situation like thatA     (s per news reports. what if the Indian government is left with no option but to come after "+. $hile the -entral !ank said the in1uiries were simply for data collection.. . then what's the guarantee they won't come after your gold or your money when all other options are e haustedA &ven the thought of that is very scary..isten.I("8)'(&R has done e tensive research on this issue. there is. &L.' government didA $hat will happen if another set of population goes unemployed or without pay when the unemployment stats are already so highA $ill our banks be able to manage if people delay their mortgage or credit card payments when they already have a high percentage of bad loans on their accountsA $hat will happen of crime control or healthcare in such a scenarioA )nd lastly.If things indeed get that badJ  $ill the government then be able to maintain at least the critical services like the . but also make money as these events unfold.

. what should you doA $here and how should you invest your money so that it's not .. .. )nd the stock market keeps fluctuating by hundreds of points nearly every day.. here's what we recommend.. many of them don't understand the gravity of the situation fully and think that things cannot and will not get worse than this. %T$OF &' +nderstanding the problem at hand clearly &ven though people have been suffering from rising prices and increasing ta es for 1uite some time now... that is far from the truth.%iven the current alarming situation. and also possibly make some good gains to show for it. /owever. "es.. it'd be foolish to e pect any D1uick7fi D solutions to this problem. ABreakthrough . . 'o if you wanted to grow your wealth in a climate like this.+( worse for normal Indians. but also gives you siFeable returns in the years to comeA (hat is the 1uestion we try to answer in our latest special report titled. $e've showed you above how things are already getting a lot. What 'ou Can 9o to 0rotect 'ourself and Actually /a.afeguard 7our 6ealth during nd of $ndiaA... !ut if you stick to a proven plan and be patient. )nd this report is basically divided into three parts. But .ust protected. you can get through this difficult phase with minimum damage.eople are already paying much more in ta2es thinking that all is well..e /oney $e are currently living in a time when fi ed deposits are giving negative real returns.trategies to . %old has become really e pensive and hence not a viable investment like earlier.

%T$OF -' The right way to in#est using these troubled times %iven the troubled times we are seeing right now 7 when even the . we will clearly e plain what D&nd of IndiaD is.' government came so close to defaulting on its payments 7 it's important that you ensure all your family's short7term. then you should definitely be reading and following the approach given in this report. you will change your opinion after reading this. (his way. $e will give you the complete picture. you might e pect us to lead with stocks. *ow.the actual situation is similar to that of a blindfolded man Ia sincere ta2payerJ unknowingly walking towards the edge of a cliff Ia financial crisisJ. )nd also make your wealth more vulnerable to any financial shocks happening in the near future. "ou should allocate a specific percentage to each asset class 77 as indicated in the report 77 to minimiFe your risk and ma imiFe your return. you will be protected against all kinds of financial hiccups that may happen in the months to come. If you're someone who is serious about protecting your family's financial future. which is very likely from the way things are going on right now. . being a stock research company. If things get really bad. 'o if you thought your future was safe in India till now. (oo much or too little of something will reduce the returns from your entire portfolio. 'o in this report. without holding anything back. . !ut stocks actually come only after you've made sufficient investments for your basic and near term needs. $n fact. and how it will impact you and your family's finances. we ha#e listed 5 different asset classes into which your entire wealth should be di#ided. middle7term and long7term needs are properly provided for.

ority of other people by following these simple steps. 'o don't worry. How you can get this re(ort$ $ $ (he entire purpose of creating this report was that as many people as possible read it and prepare themselves for the threat ahead.elect ser#ice a try for 09 days without any risk. Returns obtained from good companies in the long run are often unmatched when compared to returns from anything else. there's also a bonus section in this report which you can benefit from right away. 'o you have everything to gain..you will be better off than the ma. !ut it's something that could help you both protect. )nd if things don't get that badA $ell.. e1uities may form only a small part of your entire wealth like I said. and grow. !ut they still form a very important part. If you act on it. that's the best part... . we will give you this report absolutely CR&&# (ll we ask in return is that you gi#e our . your wealth during the uncertain times we're seeing right now and will continue to see in the near future. $hat's in this sectionA (hat we will tell you only in the report.ook. %T$OF 0' (n opportunity to profit from this report right away Cinally. and nothing to lose from implementing this. 'ome of our recommendations in the long run have given returns likeJ . ..tock. of course.. even then you will be in a much better position than your fellow investors.

.<0ul<%> Pr#%e o! re%o))e! at#o! ate2 ?&.ust around 4 years# !ut that said. has been at the forefront of this endeavor. 'o before you invest in a stock today. $hat kind of role does domestic demand play for the companyA <.% E<6u"<. you have to analyFe numerous things likeJ 2.ust 2 lakh in each of these companies back then would have given you Rs =3 lakhs.. 'tock'elect helps you profit from the biggest and best companies in the market without . Pr#%e a$ o! Se'' re%o))e! at#o! .> $. &vents and regulations in one country now affect the performance of companies in some other country more than any time before in history. Rs 94 lakhs and Rs ?< lakhs respectively in . .>5 Se'' re%o))e! at#o! ate $%<Mar<. /ow will a new law or regulation in a foreign country impact the company's salesA =.?<(ct<. 'tock'elect.5 >.Co). gone are the days when you could invest in any random stock and walk out with a profit.5 &.. )nd our best7performing service. $ill the dollar value or oil prices affect the company's profitsA 3. $e launched &1uitymaster in 2@@6 with the sole aim of helping investors make educated and well7informed investing decisions without taking on too much risk.a!y )5D Goltas Ditan Date o* buy re%o))e! at#o! 5<8ov<%$ >%<0un<%> $. E$% $. $hat's the status of the global economy right now..and so on and so forth.% . and how is it likely to remain in the near futureA 9.H Retur!$ > >.F $ &?%F E ?%&F :4rices ad@usted for bonus stoc! splits 4ast performance does not "uarantee future results $hich means .

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