Inclusive finance

One may wonder why India is insulated from Global tremors in the finance sector. Although the health of the equity market is contingent on foreign investments from Europe and America, the stability of Indian counterpart is commendable. It is time for our local investors to takeover from here. It is not easy. We need to involve our millions of population available, and turn them into our local investor. We need to guide them taking financial decisions and in no time we will become actually disparate from this meltdown.

I know this is not fool proof and sometimes it is necessary for foreign capital to come to India because of large volumes of investments. This factor is not in our hands. What lies with us is making more and more number of people aware of their financial decision. Making them aware of long term and short term financial planning and above all making them investors. The other point I wanted to state that is the need of medical insurance or any other insurance for that matter. Consider this : your servant’s father had a severe heart attack and requires an immediate treatment. DO you think that person will be able to bear this huge costs of Angiography or angioplasty. The debilitating health conditions in the vicinity of poverty line are anathema for these people. Helping them and making them aware to buy a health insurance will always help them.

It is unfair that the most populous sector is the least in generating revenues. Yup we’re talking about Agriculture. Our own national government can invent instruments (or discover as it is already present in US) like weather derivatives to enable the farmers hedge their dependence on rainfall for their agriculture produce in that year. So at least if there is regularity in rainfall, the framers won’t have to bear all the losses alone.

One more awareness program can be related to remittance programs. Money sent home by migrants constitutes the second largest financial inflow to many developing countries, exceeding international aid. Latest estimates vary between IFAD estimates of US$401 billion and the World Bank information from central banks at a more conservative US$250 billion for 2006 and these figures are increasing by almost 30% year on year. Remittances contribute to economic growth and to the livelihoods of needy people worldwide. Moreover, remittance transfers can also promote access to financial services for the sender and recipient, thereby increasing financial and social inclusion.

This is true that if we follow inclusive growth and make our fundamentals strong, like Warren buffet, ”If the stock dips after I have purchased it, I don’t worry so long as its fundamentals are good. “ . Hope I’ve made my point !!