Science subjects like Physics, Chemistry, Medicine, Technology, Astronomy, etc. are quite complex and unless you have formal education in these subjects, they are difficult to comprehend. However, the same is not true for financial topics and with some interests and efforts, Doctors, Engineers, Architects, and even Housewives can take charge of their money matters and lead a financially confident life. Most Indians remain obsessed with three popular topics, namely, Politics, Bollywood and Cricket. A lot of valuable time is consumed in reading articles/blogs/news items on these three topics and an equal amount of time is spent in discussing/gossiping the same with family and friends. However, even if a fraction of this time is spent upon brushing up your knowledge on money/financial matters, it can work wonders towards improving your lifestyle as well as the quality of life. By going through financial news items and by watching business TV Channels, you can constantly update yourself with important developments and crucial financial concepts like rate of inflation, GDP growth rate, interest rate movements and other ups and downs in Equity markets together with returns being generated by Stock Market over one, three, five years and on a long term basis. However, please remember that “half-knowledge” is even more dangerous than “no knowledge” at all. Therefore, develop a habit of getting into meaningful conversations on financial developments with your spouse, friends, colleagues and most importantly with your expert investment adviser. We share below a few simple strategies for adopting in your life to be financially prudent.

1. Choose a Family Financial Doctor

All of us ensure that we have an experienced, trustworthy professional family doctor who is available at short notice to take care of any health-related issues for all family members. It is equally important to choose a finance/investment expert who will understand your needs and goals and help you take appropriate investment decisions from time to time to ensure that you remain worry-free on money matters. Your financial doctor must have a long and credible track record with requisite qualifications like Certified Financial Planner (CFP) or a Registered Mutual Fund Adviser or IRDA certified insurance professional etc. It is preferable to deal with trustworthy organizations that specialize in rendering professional investment advice rather than depending upon one individual who may or may not be well equipped to take care of your variety of financial needs. You must take references from your family members and friends before availing the services of a financial planner or a financial services organization.

2. Be Transparent with Your Adviser

Once you have carefully selected your financial adviser, you must be totally transparent with him/her by sharing all relevant information on your current investments, various sources of income, your monthly saving potential and details of your future financial goals. You must also be ready to share the exact year in which your future goal will arise and also approximate amount required to fulfill that goal/ responsibility. Your financial planner will also seek other important details like risk-taking appetite, details of dependent family members, income tax bracket and already running insurance policies, etc. through a detailed questionnaire which you must answer accurately and honestly. Your transparency will help your financial planner to serve you better and then you can even hold him/her accountable for the outcomes.

3. Have Regular Meetings with Your Adviser

Your interaction with your adviser should not be transactional only. You must meet your adviser face to face at least 4 times in a year and understand how your investments are performing and whether any changes need to be made. These meetings will give you a good opportunity to update your own knowledge about developments in the financial markets. Also, if your financial condition has undergone any change like a promotion or an increment or change of job or childbirth etc., you must share the same with your adviser to enable him to reconstruct/revise your investment strategy accordingly.

4. Involve Your Family Members in financial Matters

Many working husbands make the mistake of not involving their wives into financial matters particularly if they are housewives. It is not a prudent habit at all. Both spouses must take equal participation in discussions with the family financial doctor and even adult children should be consulted/informed about investment strategies being implemented by the family for their own bright future.

5. Don't Hesitate to Ask Questions

During your conversations with your professional investment adviser, you may hear some technical-sounding concepts which you may not understand immediately. Please don't hesitate to ask questions as not only it will remove your ignorance but also make you more confident about the decisions being made about your own financial future. Make sure that you understand the true meaning of investment terminologies like Asset Allocation, Risk-Adjusted Returns, Exit Loads, Balance Funds, Capital Gains, Risk Appetite and Appropriate Time Horizon, etc. These are easy to understand concepts and will greatly help you in taking informed decisions to brighten your future. Please remember an old saying: “Those who ask questions look ignorant but those who don't ask questions remain ignorant”.

6. Think of the Worst and Prepare for the Best

Every investment must be held jointly with your spouse or any other family member of your choice. Similarly, wherever a nomination facility is available, it must be used by carefully selecting the family member or any other person that you wish to nominate in case of occurrence of any unfortunate event. If this aspect of joint holder or nominee is not taken care of, the same may lead to extremely complicated procedures for legal heirs to claim the investment amounts. Also, written “will” must be made clearly indicating the distribution of financial and other assets amongst children and successors.

7. Preserve Important Documents Carefully

You must insist that your financial doctor must provide you with a written document called “Financial Plan”. This document must be referred by you from time to time to ensure that all decisions are being implemented as per the plan. Also, periodic portfolio statements as handed over to you by your advisor must be preserved either physically or digitally to monitor the financial progress. Proper documentation will help you in filing your income tax returns accurately every year. By following the above steps, you can attain financial nirvana. In a modern-day world which is full of tensions and worries, if you can keep a good control on your financial matters, it will make your life much less complicated and enable you to lead and enjoy financial freedom. It will also give you a tag of a financially prudent and successful person. Anil ChopraDirector, Bajaj Capital Limited

Looking back at the past 12 years, I have grown and learned so much. I never thought that I would actually accomplish my educational dreams and be so successful in my life, but I definitely have proved myself wrong. I love knowing that I am doing great and I give all the credit to my Alma mater International College of Financial Planning. After completing my graduation in B.A (Hons.) Economics from Delhi University, I could not take the final decision of pursuing my masters in finance by working super hard and giving up that leisure time in life, but finally I decided to just go for it and I am so glad I did because now that I have overcome that fear, I feel that I can accomplish anything and everything on my career path. After I joined ICoFP, my life changed in a lot of ways, most importantly I learnt discipline, time management, good business ethics and moral values. After one year of completion of my post-graduation in Securities Analysis and Trading, I did a 2 month summer internship with Deutsche bank (private banking). And then post completion of my course of 24 months, I got placed in HSBC Private Banking and fortunately all of this happened through the excellent placement team of ICoFP. During the four years of work in HSBC, I developed into a strong, bold and wise woman. I faced all sort of challenges but I still made it through. I would truly like to thank my college (ICoFP) for giving me this opportunity. This is the most valuable gift that anyone has ever given me; it isn’t every day that one gets a gift of education, knowledge and success. Like Nelson Mandela said “Education is the most powerful weapon which you can use to change the world.” International College of Financial Planning has given me that weapon.  It was not only about the college providing me education, but it was the amount of faith that they had in me that pushed me through, they taught me that everybody dies but not everybody lives, that in life we don’t regret the things we did but rather things we didn’t do and the dreams we didn’t pursue. And with them I have lived the dream that was once a fantasy. After I got married, I also did my masters in Economics from IGNOU. Since the past 5 years I am working in the teaching profession and have served at various colleges, International College of Financial Planning being one of them. I have proficiency in teaching subjects like economics and financial advisory. Last but not the least, I would like to say that the TRUE SUCCESS IS THE PERSON WHO INVENTED HIMSELF.   

The recent SIP flow information from AMFI shows that the May 2019 SIP input was Rs.  8,183 crore, reduced than the April 2019 Rs. 8,283. While the drop is marginal, the reason behind it may be that investors are cautious of the NBFC sector's latest spate of downgrades and defaults. The crisis impacted investors from mutual funds because the fund houses exposed to debt of such firms had to write- off their investments. This meant the scheme's NAV fell to write-offs extent. As a consequence, the fund houses also had to face the pressure of redemption and they had to liquidate high-quality papers in order to satisfy the redemptions. One fine thing, however, came out of the debacle — it broke many investors' misperception about debt funds being a secure investment. While the level and type of risk differs in investments, the reality is that no investment is safe and secure. The greater the expected yields, the greater the risk is involved. This shows that one should not only look at the anticipated yields while making investment choices, but also at the risks associated with such investment. Mutual fund investment can assist in minimizing the multiple investment-related risks. Note, however, that mutual fund investments are not risk-free. Here's how some investment-related risk can be mitigated when investment is made in mutual funds: Inflation risk If investment's value does not rise above inflation, it can erode your money's buying power. With reduced inflation-adjusted yields and with the cash you have, you will be able to buy less products and services. You should therefore invest in resources that will, over time, value your wealth and thus counter inflation. Diversified equity funds would be a better choice than debt funds for this purpose. Equity funds are capable of generating greater long-term yields. Business risk It relates to the danger that because of any internal or external variables, the company / business in which you have invested may fail to achieve their goal, suffer losses, bankruptcy, etc. If you invest in just one company / business, because of the concentration of your investment, your risk will be greater and consequently your loss may be greater too. As the mutual fund invests in the shares of many companies, it enables diversification of your investment. It is unlikely to underperform all of the scheme's stocks at the same moment. Thus, if the stocks in the scheme underperform, your losses will be reduced, but your profits will also be limited. Credit risk This is a significant problem these days for debt investors. People are investing in debt instruments hoping to get back their principal amount along with interest on the maturity day of the instrument. Investors experience credit risk if the business delays or defaults in payment. In general, credit risk debts give greater interest rates to compensate investors for their risk. You can choose Gilt Funds to handle credit risk; they invest in public bonds supported by sovereign guarantee. Note that the interest rate they give will be smaller while government securities are safer. Moreover, invest only in debt schemes provided by mutual fund houses that follow solid investment procedures and have in place appropriate risk management mechanisms in place. Interest rate risk The interest rate of fixed-income securities also shifts when the RBI changes its policy rate. The value of debt securities is inversely linked to the interest rate. Therefore, the securities price will increase or decrease in line with the shift in interest rate. Interest rate fluctuate more when the debt instrument's duration is higher. If you want to invest in low-interest-rate debt funds, you can opt for short-term debts like liquid / overnight funds, ultra-short and low-duration funds, money market funds, etc. Liquidity risk This risk makes it impossible for you to redeem your investment whenever you wish. Some investment avenues come with a lock-in period and redemption is not permitted during that period. You may have to suffer capital loss even if it is permitted. If you find that the chosen route is inadequate or not appropriate for your requirements during the investment process, you will have no option but to stick. You can invest in open-ended mutual fund schemes instead of investing in lock-in period avenues. Open-ended mutual funds enable you to select funds from various categories and sub-categories, to select funds depending on your requirements. It also enables you to invest systematically on a regular basis. Conclusion Because of multiple variables such as economic performance, fiscal and monetary policy changes, political changes, and so on, investments will always be susceptible to risk. While there will always be volatility on the market, one can decrease its effect by choosing the correct mutual funds after assessing your requirements and staying invested for the long term as the short-term effect of volatility is greater. The risks associated with investments are mentioned in the offer documents, brochure, and other sources of product detail. Go through the details carefully to understand the risk involved before making any investment decision. Included in the offer documents, brochure, and other product detail sources are the risks connected with investments. Go through the information closely before making any investment decision to comprehend the risk involved. Rishi Taparia Head - Academic Affairs, ICoFP

Cognitive Biases: Conservatism Bias Conservatism bias is a belief perseverance bias in which peoplemaintain their prior views or forecasts by inadequately incorporating new information. This bias has aspects of both statistical and information-processing errors. Example: suppose a trader receives some bad news regarding a company’s earnings and that this news negatively contradicts another earnings estimate issued the previous month. Conservatism bias may cause the trader to under-react to the new information, maintaining impressions derived from the previous estimate rather than acting on the updated information. Illusion of control Illusion control bias refers to people’s tendency to believe that they have control or atleast can influence the outcome of uncontrollable events. Example: studies have demonstrated people think they have more control over the outcome of a dice game if they throw the dice themselves than if someone else throws the dice for them, and they are less apt to sell a lottery ticket they chose than a ticket chosen by someone else   Mental Accounting Mental Accounting refers to the tendency people have to separate their money into different accounts based on miscellaneous subjective criteria, including the source of the money and the intended use for each account. Example: A beer drinker will probably be willingto pay Rs. 500/- for a beer at an expensive resort. This consumption willbe put in ‘holiday mental account’. At the same time he might refuge paying Rs. 200/- for the same during grocery shopping because this expenditure is in ‘grocery shopping, mental account.   Framing Bias The framing effect is an exampleof cognitive bias, in which people react to a particular choice in different ways depending on how it is presented. Example: When given a fifty-fifty odd of either winning 100or 500 and a fifty fifty chance of losing either 100or 500. The people actually felt slightly positive when they lost 100because they avoided losing 500. But when they won 100they reported a feeling of dissatisfaction because they didn’t win 500. They felt good about losing 100because the gamble was framed in terms of losses and they felt bad about winning 100because the gamble was framed in terms of gains   Availability BiasAvailability bias is a cognitive bias that leads to decisions being based on information and events that are more recent, that were observed personally, and are more memorable. It operates on the notion that if something can be recalled, it must be important, or at least more important than alternative solutions which are not asreadily recalled. Example: Deciding to continue smoking because you know a smoker who lived to be 100 would be a good example of Availability Bias. In this scenario, the story you can recall plays too big a role in your decision to continue smoking. Emotional Biases:Loss-Aversion Bias Loss-aversion bias is a bias in which people tend to strongly prefer avoiding losses as opposed to achieving gains. Example: example of loss aversion theory can be seen in casinos around the world. There, fun-seekers and hardcore gamblers alike all follow the same pattern: The first round they play–be itblackjack or slots–is to win. The second round? It’s to recoup losses.   Overconfidence BiasOverconfidence bias is a bias in which people demonstrate unwarranted faith in their own intuitive reasoning, judgments, and/or cognitive abilities. This overconfidence may be the result of overestimating knowledge levels, abilities, and access to information. Example: A person who thinks he has a photographic memory and a detailed understanding of a subject. The person could show his overconfidence by deciding not to study for a test that he has to take on the subject, thus doing poorly on the test due to lack of preparation.   Self-Control BiasBias in which people fail to act in pursuit of their long-term, overarching goals because of a lack of self-discipline. There is an inherent conflict between short-term satisfaction and achievement of some long-term goals. Money is an area in which people are notorious for displaying a lack of self-control. Example: In the seminal work on self-control pre-school children were presented with the simple marshmallow test, in which they could either eat a small snack right away or wait 15 min and get a larger snack. Around 67% of the children in the original study failed to resist temptation and ate the small snack, indicating lower level of self-control Status Quo BiasStatus Quo bias is an emotional bias in which people do nothing instead of making a change. People are generally more comfortable keeping things the same than with change and thus do not necessarily look for opportunities where change is beneficial. Given no apparent problem requiring a decision, the status quo is maintained. Example: In Germany, a small town had to be relocated due to a mining project. Citizens were offered many plans for a new town, but citizens voted for a plan which closely resembled the old town with an inefficient serpentine look which had evolved for no rhyme or reason over the years. Endowment BiasEndowment Bias is an emotional bias in which people value an asset more when they hold rights to it than when they do not. Endowment bias is inconsistent with standard economic theory, which asserts that the price a person is willing to pay for a good should equal the price at which that person would be willing to sell the same good. Example: An individual may have obtained a case of wine that, at the time, was of relatively low cost. If an offer were made at a later date to acquire that wine for multiples of the original price, the endowment effect might compel the owner to refuse any and all offers, despite the potential monetary gains. There is a sense of personal welfare over actual wealth that is believed to drive such sentiment. So rather than take payment for the wine, the owner may choose to drink it themselves.   Vipul Bhatnagar, MBA-FA(2017-19)

Corporate governance can be defined as the system of internal controls and procedures by which individual companies are managed. It basically provides a framework for any company for dos and don’ts. It defines rights, roles and responsibilities of every individual in the organization. These frameworks, however, could differ among countries and jurisdiction. The big picture is to consider the interest of all the stakeholders while running an organization. Necessity of Corporate Governance Weak corporate governance is found to be the most common reason behind any company failure. A lack of proper oversight by the board of directors, inadequate protection for the minority shareholders and incentives at companies which promote risk taking are some of the key drivers for company’s management to neglect corporate governance. Poor corporate governance practices have resulted in several high-profile scandals and corporate bankruptcies over the past several decades. One of the examples of such poor corporate governance currently in the market is DHFL. Dewan Housing Finance Ltd (DHFL) Scam Investigative portal Cobrapost alleged a Rs 31,000-crore scam by the promoters of non-banking finance company Dewan Housing Finance Ltd DHFL, using bank loans, which it claimed routed through shell companies and passed on to the promoters. This money was then used to acquire assets overseas, including property, shares and a cricket team in Sri Lanka. Details about the DHFL Scam (Source: Cobrapost) • Created dozens of shell entities, largely with a nominal capital of Rs. 1 lakh, divided them into small groups of two–four companies, with a lot of them having the same/similar addresses and having the same set of initial directors, and on many occasions having the same group of auditors to mask the financial details • Disbursed huge loans to these shell companies mostly without any security and/or collateral, and the proceeds  appear to have been used for creation of private assets both offshore and in India • Disbursed loans amounting to thousands of crores to these shell companies in the name of secured loans against slum development projects without any due diligence or checking of collateral or maintaining adequate debt–equity ratio • Disbursed loans in a single tranche, rather than following the established norm of disbursal in stages against progress of the project works • Ensured that most of the shell companies hid the name of the lender DHFL, the terms of loan and terms of repayment in their financial statements to be submitted as required by the law • Advanced monies to several companies (run from the same address) in Gujarat and Karnataka around state elections Given donations in crores to the Bharatiya Janta Party (BJP) • Been involved in illegal insider trading, and violation of Securities and Exchange Board of India (SEBI) takeover regulations, amounting to approximately Rs. 1,000 crore • Created offshore assets of approximately Rs 4,000 crore • Bought Wayamba, a Sri Lanka Premier League cricket team, by using loan money dubiously advanced by DHFL. Scale of FraudTo just gauge the scale of fraud, DHFL’s net worth is Rs 8,795 crore with cash in hand of Rs. 2468.14 crore. It has, however, taken loans from banks and financial institutions to the tune of Rs 96,880 crore, including Rs. 31,312 crore in the form of non-convertible debentures, Rs. 36,963 crore from banks, Rs. 2,965 crore from external commercial borrowings, Rs. 2,848 crore from the National Housing Board (NHB), Rs. 9,225 crore in public deposits and Rs. 13,567 crore from other sources. Out of this sum, the company has disbursed Rs. 84,982 crores in loans and advances to other entities. According to the annual report, DHFL has secured loans from at least 36 banks.Consequences of Poor Corporate Governance Fundamentally DHFL was a good company, but due to management’s fraud and their poor corporate governance, there are huge losses not only to the public sector banks, such as State Bank of India and Bank of Baroda, with an exposure of over Rs. 11,000 crore and Rs. 4,000 crore, respectively, but also to the foreign banks, debenture holders, and to all the shareholders of DHFL. Also it will lead the entire capital market into utter shock and severe liquidity crunch, especially after what happens with IL&FS.Since there were also huge amounts of tax evasion by DHFL, the government is also at loss. The stock price of DHFL has fallen by more than 80% in last 6 months leading to the fall of market Capitalisation from Rs. 19,695 crore to Rs. 3,635 crore in the same period. If such scams are not identified, resolved and persons responsible punished, will damage India’s prestige on the world stage. Investors and institutions will fear to invest in India. More examples of Poor Corporate Governance Recently there have been more such corporate governance issues. We can take again a very recent example of  Zee and Essel group chairman Subhash Chandra who acknowledged that he had committed mistakes and apologized to banks, non-banking finance companies, and mutual funds as he had not lived up to their expectations. Subhash Chandra is the promoter of Zee Entertainment which is a profitable, high margin operating and a fast-growing mass media company. To boost the company growth further, the promoter started pledging Zee's shares and took the loan to invest in various subsidiaries so as to generate more income sources apart from their core business. They invested zee's money in various road projects, power projects, solar projects, etc. which are not at all related to the company's core business. The same thing they have done with DishTV, which is already a debt-laden company. The promoters have pledged the companies share, invested it in non-core activities and now they are neither able to generate returns nor they are able to roll over the loans. The Essel group has to meet interest or principal obligations on borrowings against pledged shares till Sept. 30 otherwise, as per SEBI regulations, rating agencies will downgrade the Essel Group's debt instrument. That would force mutual funds to write down the value of the investment and would set off another crisis for them after IL&FS. Shareholders have also taken the hit as the share price of both the DishTV and Zee Entertainment has fallen by approx 44% and 25% respectively in last one month. Just because of the poor decision by the promoters, all the other stakeholders had to suffer and this is why good corporate governance is a very important aspect for all the stakeholders.  Shivam Daga,  MBA-FA(2018-20)

International College of Financial Planning is always practicing Corporate Social Responsibility. And as a part of this, it intends to disseminate knowledge amongst the youth wherever possible. In the past month, ICoFP has been proudly invited to various colleges from Delhi University. We were pleased to address students of Bhagini Nivedita Women's College, Najafgarh; College of Vocational Studies, Sheikh Sarai; Janki Devi Memorial College; Kirorimal College; Aditi Mahavidyalaya; Zakir Hussain College and Gargi College on ‘Lucrative Careers in Finance’ at different point in time. Specific to Financial Analysis and Financial Planning, our prestigious panel members Mr. Anil Chopra, Group Director, Corporate Affairs @ Bajaj Capital Group and Mr. Rishi Taparia, Head, Corporates Affairs @ ICOFP enlightened everyone with their sea of knowledge and experience in financial world and made everyone mesmerized with their oratory. All the sessions were extremely knowledgeable and ended up gracefully with Question Answer round. ICoFP seeks forward to more such sessions.

The last budget of current Government before it comes to power again was presented by Finance Minister Mr. Piyush Goyal. It is Interim budget 2019. In this budget, it was proposed to double the tax exemption limit for salaried class from existing Rs 2.5 lakh to Rs 5 lakh and also increased the standard deduction to Rs 50,000 from current Rs 40,000.If an individual invests in the specified tax saving schemes of the government, the effective tax-free income limit will be Rs 6.5 lakh a year, while it may go further up with additional avenues like NPS, medical insurance and home loan interest payment.The gratuity limit has been increased from Rs 10 lakh to Rs 20 lakh from the next fiscal.For middle class, small depositors and Senior CitizensTDS threshold on interest from bank, post office deposits will be raised from Rs. 10,000 to Rs 40,000.The proposal will benefit senior citizens and small depositors who depend upon income from interest on deposits in banks and post offices.The Budget also proposed to exempt tax on notional rent for unsold housing units for two years. It also proposed that benefit of rollover of capital gains tax will be increased from investment in one residential house to that in two residential houses, for a taxpayer having capital gains of up to Rs. 2 crore. However, it can be exercised once in a lifetime.Further, the TDS threshold for deduction of tax on rent is proposed to be increased from Rs. 1,80,000 to Rs. 2,40,000 for providing relief to small taxpayers.Bonanza for Farmers Budget announced major sops to provide relief to distressed farm sector. Under the scheme called 'Pradhan Mantri Kisan Samman Nidhi', FM announced that farmers holding up to 2 hectares of land will get Rs 6,000 per year cash support. This will cost the exchequer Rs 75,000 crore annually, The Rs 6,000 will be transferred into bank accounts of each farmer in three equal instalments. It will benefit 12 crore farmers and will be implemented from this fiscal itself.Rs 20,000 crore have been provided for current fiscal and allocation of Rs 75,000 crore has been announced for the next fiscal.Unorganised sectorFM unveiled a mega pension yojna for the unorganised sector workers that will benefit 10 crore people. Workers of the unorganised sector will get assured monthly pension of Rs 3,000 after reaching the age of 60 years under Pradhan Mantri Shram Yogi Mandhan scheme. The scheme will provide assured monthly pension of Rs 3,000, with contribution of 100 rupees per month, for workers in unorganised sector after 60 years of age.Defence BudgetFM Sh. Goyal announced an increase in defence budget to over Rs 3 lakh crore in 2019-20, adding that additional funds will also be provided if necessary. Rs 3,05,296 crore have been provided in the Budget Estimates for 2019-20, compared to Rs 2,82,733 crore provided in 2018-19 Budget Estimates.Expectations from Next Budget: We expect the next budget will focus on all areas like infrastructure development, employment generation, start-up businesses, improvement in medical facilities, focus on opening up of educational institutions, increase in Defence expenditures to protect borders and support to farmers in terms of awareness about use of technology to increase agriculture produce. All the upcoming budgets should take India to a higher growth rate in all areas. We also expect that 30% tax rate should apply only to those earning above Rs. 20 lakhs annually. Currently, the 30% tax rate applies to people earning Rs. 10 lakhs and above. Madhu SinhaCampus Director, ICoFP Mumbai

India is one of the best countries to start an idea. With the surplus advantage of a huge target market, so many needs and a technological strong growing economy, India is stepping towards becoming one of the world's strongest tech markets with the best startups in India. Having thrived at home for nearly a decade, India’s startup scene went global in 2018. Several young tech companies in India are all set to take on the world this year, some of which are Ola, OYO, Byju’s, Paytm, Swiggy, Zomato. Indian entrepreneurs have been on a roll this year. The Indian startup ecosystem is brimming with business ideas that continue to enamor investors as well as the global ecosystem. On one hand, we have prodigies exploring entrepreneurship and people leaving their jobs to turn an idea they’re passionate about into reality. Meanwhile, there are others marking second (or even third) coming, leaving no stone unturned to outdo their last best product or service in the sector. Now, as the year comes to a close, bringing the best and most innovative startups launched in 2018. More than 1,200 startups came up in 2018, including eight unicorns, taking the total number to 7,200 startups. It is important to celebrate startups and their successes, given the cutthroat world they operate in. Reportedly, 90% of startups in India fail within the first five years of inception. So, the ones that make an impact must be put in the spotlight, celebrated, and presented as an inspiration for new startups in the making. The key growth drivers were enterprise software, fintech, healthtech marketplace and edtech. Data analytics, artificial intelligence and IoT startups have been witnessing fastest adoption across industry verticals. Being right at the centre of the Indian startup ecosystem, startups are just in the right place to judge which ones disrupted the industry and made a mark. Apart from all this, startups can boost the economy as a strong. Fortunately, they can increase the country’s GDP, generating employment opportunity in the economy. So far, startups in India have increased this year in which our country is standing on the second position following the United States of America. Startups hence provide great opportunities those who want diversify their business in the global emerging market. V. Mahalaxmi NadarMBA-FP (2018-2020)

Global Economy In 2019, the dominant global theme will be quantitative tightening, with major central banks draining systemic liquidity after a decade. This comes at a time when global growth is sluggish and interest rates are rising. Consequently, we expect a shift to relatively dovish stance. Soft commodity prices on the back of sluggish growth will also support lower inflation. Commodity-importing emerging markets (EMs) like India can heave a sigh of relief as macro stability has returned, and the worst is behind. Nevertheless, we do not rule out ‘panic attacks’ in EMs, given tightening global liquidity. Ongoing trade will remain in limelight this year as well. Interesting thing will be to note how it turns out after the upcoming meeting in January. Global growth is already facing headwinds with growth in the European Union slowing. Chinese growth is also under pressure, and economies from East Asia to Germany are feeling the impact of trade wars. Quantitative tightening and rising US interest rates imply that global growth could come under further stress. Moreover, Countries dependent most on exports, specially the commodities might get suffer. Further, slowdown in developed nation might lead their domestic firms output to dump in emerging countries and will impact emerging economies as well. Indian EconomyGeneral Election 2019 - The year 2019 would witness General elections (April/May) along with a host of state assembly elections. 4 states could have polling along with General elections – Andhra Pradesh, Odisha, Sikkim, and Arunachal Pradesh; followed by elections in the state of Maharashtra, Haryana, J&K and Jharkhand later in the year. Any change in political formations would be keenly watched by the investors in the run up to the General elections; however it is the fact that 5 of the 7 election years in the past 3 decades have yielded positive returns.   GDP Growth - In 1QFY19 and 2QFY19, GDP grew by 8.2% and 7.1%, respectively. The cyclical recovery in 1H2019 was due to a low base of 1H2018. Despite fears of emerging market contagion and the US-China trade war rhetoric, India is expected to grow at 7.3% in FY2018-19. India’s favourable demographics continue to support growth from a long-term perspective with India remaining one of the fastest growing economies in the world.     Indian Rupee - The INR was one of the better performing emerging market currencies in 2017 but quantitative tightening by the US Fed, FII outflows, emerging market currency weakness and higher crude prices (and CAD) led to a weak INR throughout 2018. The INR fell sharply to an alltime low of 74.39 v/s the USD but smartly recovered by 5% in the last two months, which coincided with the sharp fall in crude oil prices. Historically, over the past 15 years the INR has witnessed long periods of overvaluation and short periods of sharp corrections. INR levels in 2019 will primarily depend on three factors - CPI, crude prices, global yields and it is believed that the INR will be rangebound within (+/-) 3-5% from the current level. Crude Oil - By Oct’18, crude appreciated 36% and hit a near 4-year high of USD 86/bbl due to rising concerns regarding sanction on Iranian oil exports by the US with many analysts projecting a possible hit of USD 100/bbl mark. However, the last couple of months saw a very sharp 40% correction in crude prices due to fears of weak global demand. This fall in price reduced pressure on CAD and provided potential for INR appreciation. Due to increased supply and softening demand, crude oil prices are expected to remain subdued in 2019.   CPI Inflation & RBI policy - CPI Inflation was 5.07% at the start of 2018, while it declined sharply to 2.33% by Nov’18, much below the medium-term target of 4% by the RBI, mainly due to continued deflation in food prices and the recent fall in crude oil prices. The RBI has projected inflation at 2.7-3.2% in the 2HFY19 and 3.8-4.2% in 1HFY20. CPI Inflation is expected to remain under control; however, core Inflation is likely to remain elevated for the next few months. Repo rate was at 6% in the beginning of 2018. The RBI hiked the repo rate twice by 25bps (in June and August) due to expectations of higher inflationary pressures. The RBI changed its stance to “calibrated tightening” in its October monetary policy and has maintained the stance, keeping the repo rate unchanged. Current Account Deficit (CAD) - In FY18, the CAD increased to 1.9% of GDP from 0.7% in FY17. In 1HFY19, the CAD increased to 2.7% of GDP from 1.8% in 1HFY18, on the back of trade deficit widening. The external sector should continue to be a headwind for the Indian economy in CY2019. While softening crude oil prices will provide the relief, there are some structural factors like lack of strong export growth and uncertainty of capital flows, which will pressurise the external sector.   Shivam Daga MBA-FA (2018-20)