September 2020


US economy has been the most dominant economy since the end of World war 2. US dollar continues to be the store of value and haven for investors in times of risk aversion. 61% of the Forex reserves of countries are invested in dollar-denominated assets and 40% of world debt is denominated in the US Dollar, as per IMF

US dollar was created by the Act of Federal reserve in 1913. At the time, the US had overtaken Britain as the largest economy though Britain continued to hold its sway in the world economy and most transactions continued to be done in Pounds. US dollar was pegged to Gold as were all the major currencies of the world. The US was the major supplier of military equipment during world war and imported huge quantities of gold creating the largest reservoir on the planet. Bretton wood agreement put the seal on the US dollar as the reserve currency in 1944 when all major countries linked their currency to US Dollar while the Federal reserve re-affirmed its commitment to redeem the dollar for the value of gold.

In 1971, stagflation in the US economy prompted a run on the US dollar when the demand for redemption of the dollar against gold created the risk of the US losing out on precious gold reserves. After a round of devaluation of the US dollar against gold, President Richard Nixon delinked the US dollar to gold standard. This effectively removed any limit on the supply of dollars by the Federal Reserve. The devaluation of the dollar also made US exports more competitive giving a boost to domestic manufacturing. 


OPEC imposed an oil embargo on the US in 1973 as a protest to its support to Israel in the Yom Kippur war. This created long ques at the fuel stations and effectively brought the oil guzzler economy to a grinding halt. In 1979, US entered into an agreement with Saudi Arabia and oil-exporting countries wherein they agreed to sell oil only against dollars. It created an unending appetite for US Dollar by oil-importing countries like India, China

In return, US agreed to protect the House of Sauds against all acts of internal and external aggression. OPEC countries also pegged their currencies to Dollar or a basket of currencies dominated by the dollar. It helped in insulating the economies of OPEC countries from wide swings of inflation as they were importing most of the goods also in US dollar.

Current status of US Dollar and Covid 19

  1. US dollar continues to be the preferred currency of exchange and US continues to be the largest economy. It is noteworthy that personal consumption as a share of US GDP has risen from less than 58% in 1967 to over 70% today. Unlike other countries, US borrows its way to consumption by issuing US treasury bills which are lapped up by Central banks, Hedge Funds, etc around the world. US redeems Treasury Bills by printing currency since there is no limit on the supply of dollars after the abandonment of the gold standard. Ironically, the holder of reserve currency runs the largest trade deficit in the world at USD 616.8 Bn in 2019. US today has become akin to a consumer that maintains its momentum of consumption by increasing its debt and meeting it by printing currency. Rest of the world is also playing the game as it keeps its factories up and running, needs dollars to buy oil, and gives it the fallacy of increasing foreign exchange reserves denominated in a currency issued by a country that has an unending supply of notes. The question that we need to ask is that is it sustainable?
  2. Total debt carried by US has risen from USD 10 Tn in 2008 to a staggering USD 24 Tn as per Congressional Budget Office. Daily interest cost of the debt is a staggering 1 Bn USD and the debt per person in US is USD73K. As a percent to GDP, it stands at 106.9% up from 68% in 2008 when financial markets were on the brink of collapse. Further, it is 106.9.% of GDP of a country where consumption contributes 70% of the GDP funded by the largest trade deficit in the world. Debt is invariably a pre cursor to a financial crisis and the world is not a pretty place today. 
  3. US has been at the fag end of the curve in the manner in which it is responding to the pandemic. As of the date of writing, US has 7.2 Mn cases of infections with more than 200K deaths. Different countries have followed different approaches in responding to the pandemic. While we are yet to see any meaningful analysis in terms of what would be the most optimum approach in dealing with the pandemic, US has been the worst hit. It may not be an understatement to say that the US is heading into a catastrophe that is both human and economical. 
  4. This crisis is inherently different from the housing crisis of 2008. In 2008, the cash flows of Subprime bonds rated AAA by rating agencies around the world trickled down to zero with the collapse of the housing market. AIG which sold insurance against the default of Subprime bonds through Credit Default Swap (CDS) was staring at losses running into billions of dollars. It was bailed out by US govt which invested a staggering USD 180 Bn to prevent the collapse of the systemically important institution along with investments in major US banks to prevent their collapse. Companies today have created global supply chains to optimize on the sourcing, manufacturing and logistics costs. Covid 19 has disrupted the global supply chain in a manner that was not hitherto imagined. US has reacted to the existing crisis like how it was able to successfully manage the housing crisis of 2008. It has unleashed a Quantitative easing program for a staggering USD 2 Tn. Economists have been pleasantly surprised with the return of demand at Pre-Covid levels in some sectors but the distribution of demand is far from uniform. Companies have been responding to the loss of demand with automation and digitization initiatives which would not help in restoring employment to Pre-Covid levels for quite some time. Supply chain disruptions due to Covid-19 will not help the matters either. The huge influx of liquidity in the world economy may keep financial markets afloat for some time but will lead to inflation and devaluation of US Dollar which has been in an era of unlimited supply. 

The world order is changing in ways that have not been seen earlier. It will be too early to hazard a guess on the world order post the pandemic but will essentially depend on how various countries around the world respond to it. If US fails to respond in time before it’s too late, it may impact the world order and the greenback leading to a crisis of confidence in currencies. Gold may come back in limelight and so may the cryptocurrencies. Time is yet to cast its dice!

Kisan Vikas Patra, the original claimant to “Double Your Money” marketing campaign has been with us since decades. As a kid, the math behind it intrigued me. It was the Power of compounding which I learnt later in middle school, but there was no way to quickly know how many years it would take to double or triple the investment. My mother was the official financial planner of the house, even though father was the sole bread winner, as in the case of millions of middle-class families. Doubling money was one of her cherished goals as she tried to match the cash outflows to current cash balance plus future earnings of my father plus investment earnings. It included both revenue and capital expenditures – like college education and children’s weddings. And the plan was reviewed frequently to adjust for any unforeseen hiccups. That’s cashflow forecasting at its best! MS-Excel – you were not there to help. It was all in her mind and utmost on a few pieces of paper. A simple Casio pocket calculator, which my father used in his hospital to reconcile veterinary drug inventory and his monthly expense statement to the HQs, was all the tech there was. But she was not very fond of it. She took to the traditional path of using pencil and a paper to work it out. But most times it was my father’s and my task to re-compute and re-verify the “return” claim of every investment opportunity.

KVP was part of her investment portfolio. 80s and 90s were the good old days of high interest rates – my earliest memory was KVP promising to double the money in 5 years, which became 6 years by late 80s, then 7 years and so on. Currently it is at around 13 years (After the reading this article try to arrive at the interest rate offered if doubling is promised in 13 years – you can give your answers in the comment section). And that claim was taken at face value without any doubts. Government backed security – so no risk of default. So, if they can double your money in 5 years what is the interest rate they offered? Or if they offered 10% interest per annum – how long it took to double your money. You can arrive at the rate of interest and the years to double by using Compound Interest formula you learnt in your middle school. Both these questions can be answered by applying the knowns in the formula A = P(1+r/100)^n to arrive at the unknowns.  P = Your initial investment or Principal amount, r = rate of interest per annum, n = number of years and A = Maturity amount.

That calculation would take some time, say a few minutes, but if you apply the “72 Thumb rule” – it takes exactly 2 seconds – may be less if you are quick in basic math. It’s a one-step formula – divide the number 72 by the rate of interest per annum to arrive at the number of years it would take to double your money. If your investment is earning 10% per year, then it takes approximately 7 years and few months to double. If interest is 8% – then doubling time is 9 years. And conversely if they claim the investment will double in 6 years you can arrive at interest rate per annum by dividing 72 by 6. The answer would be 12%. It is important to remember the effect of compounding here. That means the interest earned in first year gets added to the principal amount and the interest for the second year is calculated based on initial investment plus first year interest earned. The interest keeps getting added and the compounding chain continues till maturity. And that’s Magic!

Interest Rate Years to double
8.00 9.00
9.00 8.00
10.00 7.20
11.00 6.55
Table with interest rates and years to double

We will continue to learn more tools that are generally used in Corporate world, but equally adaptable to personal finance decisions. If you want us write on any topic of your choice in Finance, Economics, Tax, Medicine – do let us know in the comment section. We will be happy to help.

Social Emotional Skills: It is common to hear spouses say that they give freedom to their partners; parents say I give my child more freedom than needed. Where and how does this thought of owning another person’s freedom begin?

Soon as a child is born, the parents start building castles in the air about their future that revolves and depends heavily on the child. Even before the child can start thinking for him/herself, expectations and dreams are set by the parents and the family. The parochial attitude to mould the child according to the whims and fancies of the parent starts way too early and the identity of the child is the least of their worries. The free will and independence to form ideas and question existing patterns get restricted are the cornerstones in the development of a child’s social emotional skills. A child becomes a mere tool in satisfying parental dreams.

How do we break this pattern of handing over the same baton to complete the same relay? How do we kill the idea of owning another person’s freedom and identity from our deep-rooted belief system?

Let me give you an example. One of my uncles wanted his son to become an engineer as the uncle had aspired to but could not fulfill due to financial and other issues. When his son was born, he made a promise to ‘make’ his son an engineer and fulfill his dream through his son, come what may.

Now ‘making’ your son an engineer and ‘supporting’ a child’s wish (whatever that may be) are extremes of the same paradigm. Since the father had been dreaming of making the son an engineer, every small thing that he conjured up in the child’s growing up years had an invisible thread to the larger unspoken mission. The boy was artistic and wanted to pursue fine arts. Whenever he found time, he would run to his canvas and his clay moulds. His life came alive through his clay models and canvases. The father chose not to appreciate or encourage his talent, lest the parental dream came crashing. Since the boy was never given the space to express himself, the pent-up feelings and emotions started breaking his inner peace. Each time he tried to explain his lack of interest in physics and metaphysics, promptly came the draconian command to obey the elders. The son became mentally and emotionally detached from his parents and socially withdrawn. By the time, anyone could intervene and make the parents understand, he was already admitted to an engineering college. The first year into college, the son had a mental breakdown. By the time the parents realized their mistake the child had slipped into depression unable to express himself or be true to himself.

“There are no bad students, only bad teachers” it is said. In the same breadth let us also understand there are no bad children, there are only misinformed parents. The socially accepted gender definitions and gender-defined responsibilities also push parents to dictate do’s and don’ts to their children.  What leads to such incidents and how can we avoid them? The first step is to make the future generation aware of their rights, to make them independent at a young age, and to respect their choices and thoughts. From letting a toddler choose the dress he wants to wear, to not forcing religious practices, space and path to form character and identity for a child are aplenty. Introduce them to as many nuances and facets of life as possible. Discuss at length conflicting ideas, concerns, issues, and beliefs. Encourage them to read, research, interpret, introspect a matter in depth. Inspire them to form opinions and ideas. Handhold them when they tread an unhealthy path. Support, hold and help them back on their feet when they trip and fall. Let them bloom through their ideas, have their falls, and learn from mistakes. Hug them when they least expect it. Tell them you are with them on their journey. This way, you give them chance to evolve beautifully, and in all hue and color. They will learn to be independent and not be trapped in the shadows of their parents’ wishes or dreams. Unfortunately, economics trumps social emotional skills development in most Indian households’ decision making.

As much as parental care is important and inevitable, the child must be encouraged to think and learn independently. The first step towards building a socially and emotionally stable household starts here. As a first, parents should begin to accept a child as another ‘individual’ and not an extension of them. The thought of giving freedom would organically translate to encouraging them to explore and expand thus. As a parent take these first steps in nurturing your child’s social emotional skills!

Every listed company prepare Annual Reports and send it to the shareholders’ listed in the shareholders register in order that they can attend and vote in the Annual General Meeting of the company. The Annual Reports are reports on the financial and business performances of the companies during the year being reported. Usually, annual reports are bulky tomes and everybody dreads reading it, even the people from the finance background. But the Annual Report is essential reading for an investor. Most of us who own shares in listed companies forget the fact that we are part owners of companies and we need to know how the company we own has fared. This is your first guide on ” How to read Annual Reports of listed companies”

We need to know what to read in an Annual Report to get a gist of the company performance and for that, we only need to focus on the following:-

  • Financial Statements

Under the financial statements, we need to look at the following:-

  • Auditors Report – Here we need to find out whether the auditor has given a clean report or a qualified report. When the auditor gives a qualified report, it is generally a red flag and he gives the reason for the qualification which the investor should look into
  • Balance Sheet – This statement gives the financial position of the company as on a given date. The investor should look at the working capital ratio or current ratio. The current ratio is arrived by dividing total current assets by total current liabilities. This ratio should be higher than 1 which means that the company is not using long term funds for operational requirements. The other thing to look in a Balance Sheet is the Debt equity ratio. Debt here represents total bank borrowings (both short term and long term) and equity represents total shareholder funds. This ratio should be less than 1 which means that the company is not highly leveraged.
  • Profit and loss statement – This statement shows the financial performance of the company in a given period. The investor needs to focus on revenue and net profit. They should show an increase over the previous year.
  • Cash flow statement – This is the most important statement for the investor. This statement has 3 segments – A. Cash flow from operating activities. B. Cashflow from Investing activities C. Cashflow from Financial activities

        The investor should check whether the company generated cash from its operating activities and was there any free cash flow (FCF). FCF is arrived at by taking the total cash generated from operating activities and deducting from it the fixed assets purchased during the year. The Investor should be very happy when a company is generating FCF as this means that the company has surplus cash which it can deploy into the business without taking recourse to bank loans.

  • Chairman’s report

This is a write up given by the Chairman of the company giving his perspective on the performance of the company during the year and his vision for its future. The report carries the name and photo of the person who is managing the company and it is very important for the investor to know his credentials

  • Directors Report and Management Discussion and Analysis

This is a report provided by the key management of the company wherein they give their take on  the economic outlook faced by the company during the year and how has been the performance of the various business units of the company. Both the financial and non-financial performance of the business units is discussed. The report will also highlight what were the challenges faced by the company and what steps it took to mitigate the same. The investor will get an idea as to how well the company was managed from this report.

  • Financial performance highlights

This is a datasheet that will show the financial performance of the company over the last 5-10 years in a snapshot. The investor should look at the trend of revenue, Earnings before Interest, Depreciation and Taxation (EBIDTA), net profit, earnings per share (EPS), dividend per share, and return on equity. A rising trend on all these parameters indicates that the company is well managed.

Let me assure you that reading the above will not take more than an hour but in return, you as an investor will get valuable insights about the company you own and you will be more enlightened about the company than 95 % of the shareholders.

Please find enclosed the Annual Reports for Marico for 2019-20.

The points discussed above can be found in the following places:-

  • Chairman’s Report-Page 15 provides the report of the Chairman Harish Mariwala
  • Management Discussion and Analysis-Page 88 to 103
  • Consolidated Financial Statements-Auditor’s Report is on Page 191 and refer to opinion paragraph
  • Consolidated Financial Statements-Balance Sheet is on Page 198 wherein current ratio and debt-equity ratio can be calculated
  • Consolidated Financial Statements-Profit or Loss is on Page 199 wherein income from operations and total comprehensive income for the year can be seen
  • Consolidated Financial Statements-Cash flow is on Page 202 wherein net cash generated from operating activities as well as payment for property, plant and equipment, and intangible assets can be seen. Free Cash Flow (FCF) for 2019-20 as calculated is INR 1,094 crores.    
  • Financial Highlights-Please refer to the other annexure for financial highlights from 2011 to 2020. Income from operations has grown from INR 3,135 crores in 2011 to INR 7,315 crores an increase of 133%. Other performance parameters as discussed in the write up can also be checked in the annexure.

LLP or Private Limited Company? This is one of the most asked questions by new and old entrepreneurs. What’s the most suitable structure to start his/her business? A simple google search would yield thousands of results and tens of good articles on the subject. I would share some of the good ones with these entrepreneurs but nevertheless, a few questions remain unanswered in those articles. So, I thought of compiling a simple table, although not exhaustive, (with the least amount of legal and financial jargon) to address such unanswered questions.

LLP is the newest kid on the block. LLP structure was introduced with the passing of The Limited Liability Partnership Act, 2008, which came into effect in early 2009. This structure has been in the west for many decades. The traditional partnership businesses burdened the partners with unlimited liability, many times this burden induced by other partners with the “principle of agency” at play. One partner’s actions leading to a massive loss became all partners’ burden. It had the potential to bankrupt the partners of the firm. LLP structure addresses this point primarily by borrowing the concept of “limited liability” from the corporate structure. On the other side, a typical corporate structure would entail a long list of compliance costs which can be prohibitive to many businesses. The fusion of traditional partnerships and corporates is LLP.

Hope the readers find the table useful. If any doubt still persists, please feel free to write to me or leave your query in the comment section. We shall be happy to get back.

Income Tax

  S No   Particulars   Private Limited Company   LLP
  1   Rate of Tax   Tax Rate 25%   (If Turnover is less than Rs.400 Crore. However, the Companies can choose to pay taxes @ 22%, without any deductions)   Tax Rate @ 30 % (If Turnover exceeds 400 Crore)   Surcharge; Income 1 Crore to 10 Crores -7%              more than 10 Crores -12%   Health & Education Cess : 4 %       Tax Rate @ 30 %                   Surcharge; Income Exceeds 1 Crore – 12%     Health & Education Cess : 4 %  
  2 MAT   (Minimum alternate tax) MAT -15%   On Book profit Not Applicable   AMT (Alternate Minimum Tax) 18.5% in special cases where there is deduction u/s 10AA/80IB etc.,
3 Profit Distribution Taxable in the hands of Shareholders based on their tax slab   Profit distributed post tax is exempt from tax  
4 Salary/Remuneration  to Directors/Partners No Restriction/Cap on payments to Directors Aggregate of   90 % of the first Rs.300,000/-  Plus60 % of the Balance Profit In the case of loss maximum salary allowed as expense for tax purpose will be Rs.1,50,000/-  

Companies Act vs LLP Act

S No. Particulars Private Limited Company LLP
 1 Governing Law Companies Act, 2013 Limited Liability Partnership Act, 2008
 2 Name Must contain suffix ‘Ltd’ or ‘Pvt Ltd’ Must contain suffix ‘LLP’
 3 Organizational Structure Rigid & governed by Companies Act Flexible & governed by LLP Agreement
 4 Loans & borrowings (Other than from Banks & Financial Institutions) Directors cannot borrow and lend money to CompanyThere is a Cap on shareholders lending to Company No Restrictions. Governed by LLP Agreement
5 Convening of Meetings Board Meetings are mandatoryAnnual General Meetings is Mandatory     No Mandatory requirement.   But however, the partners may decide to have periodical meetings and the same will be governed by LLP Agreement
6 Intimating ROC regarding Creation of Charge  Mandatory when a charge is created on assets of the Company Not Mandatory
   7   Maintenance of Statutory Records Many Registers are required to be maintained like Shareholders/Members Register, Directors Register No such requirement  
    8 Increase in Capital Require to Pass Ordinary resolution in General Meeting and file form SH-7. Only require to amend LLP Agreement and File e-form Form-3.
    9 Annually form filling requirement There are many E-forms  like AOC-4, Form –MGT-7  and E – form-ADT-1 Only Two annual form E-form- 8, E-form-11
   10 Disclosure of Interest Require to Take disclosure from director under Section-184(1) No such requirement
   11 Audit of Accounts Audit is Compulsory. Require only if Turn over above 40 lacs or Contribution more than 25 lacs.
   12 Related Party Transactions Transaction to be at arm’s length price only and as per provisions of Secton-188 of Companies Act-2013. No Restrictions. Governed by LLP Agreement
13 Reporting Requirements- FDI-FEMA Single Master Form (SMF) has to be filed with RBI within 30 days from the date of allotment.   FLA Return – Annually before 15th July Single Master Form (SMF) has to be filed with RBI within 30 days from the date of receiving of Capital Contribution from Partner   FLA Return – Annually before 15th July

Other Statutes

S No. Particulars Private Limited Company LLP
1 Provident Fund On Salaries to Directors/Partners Director Remuneration is covered for the purpose of Provident Fund Designated Partner’s Remuneration is not covered for Provident Fund
2 Labour Laws As per labour laws a Whole Time Director is a employee and eligible for GratuityLeave encashmentLeave as per statute Designated Partners are not Employees and hence provisions of labour laws are not applicable


S No. Particulars Private Limited Company LLP
1 Investment by Angel Investors/PEs/VCs Preferred Not preferred

The write-up is for general understanding. We suggest the readers to discuss with their consultants before deciding on choosing either of the structures.

From Amazon to upcoming reliance JioMart, e-commerce platforms are riding the golden wave by exponentially multiplying their sales and valuations from billions to trillions of dollars, what is the secret that is powering their growth? How are they capitalizing on the market? How are they able to bring a billion dollars in sales? The answer is “You”, curious how? Read on.

Today, we live in the era where Siri and Alexa (virtual assistants/bots on iOS and Amazon that help answer and perform tasks for you) know more about our choices and routine than our friends and family. Siri and Alexa are a very small part of Artificial Intelligence touted as the 4th industrial revolution that we are experiencing.

Artificial Intelligence is one of the major forces driving many industries towards exponential growth including retail. Research done from Gartner indicates that in 2021 AI augmentation to businesses can create $2.9 trillion business value and 6.2 billion hours of workers productivity [2]

In order to get our head around the trillion-dollar numbers, let’s explore the role of AI in the retail industry.

There are mainly 3 players in the retail industry.

–      Consumers

–      Retailers via brick & mortar stores / Retailers via e-commerce platforms

–      Manufacturers

In part 1 of this article let’s understand what is artificial intelligence and how is it implemented today through a simple story.

What is Artificial Intelligence?

In very simple terms, AI can be broadly described as the ability to predict the occurrence of certain event/task/sale based on the relevant data gathered in the past over a significant period. 

To help you understand this definition better, read a story below that illustrates the impact of AI with help of just one consumer (Seema) who is buying an everyday commodity (Milk) from two different stores (Amaze Store and Dinesh Store)

For ease of understanding, the story is broken down into 5 different scenes:

Scene 1: Observing Seema’s milk buying behavior over a period of 10 days

Carefully, look at the image below and see if you can answer the questions below. Do not scroll down before recording your observation. (No Cheating)!

  1. What does Seema buy every day?
  2. How many kinds of milk does Seema buy and what are the store names?
  3. What time does Seema usually buy milk?
  4. What price does Seema pay to buy the milk?
Seema's Milk Buying Pattern measured by Artificial Intelligence

The questions were easy enough right? Let’s look at the answers now.

  1. Seema buys Milk Every day.
  2. Types of milk: Seema buys either Amul Milk 1L or Goodlife Spl Milk 1L
  3. Store: Seema buys Milk from one of the 2 stores Dinesh Store or Amaze Store
  4. Time: Seema buys milk anywhere between 6:30 am to 10:00 am
  5. Price: Seema pays between Rs 45 – 65/- per day for buying Milk

Got all of them correct?! Good Job!

Now, based on the above data, try the questions below and see if you can predict Seema’s buying behavior for the next 3 days?

  1. What time would Seema buy milk on 28th Aug Friday?
  2. What kind of milk Seema would buy on Sunday 30th Aug?
  3. In which store will Seema buy milk on Saturday 29th Aug?

Although you may have answer popping up in your mind, there still some ambiguity isn’t it? Let me help you here then.

Here is Seema’s buying behavior for the next 3 days.

Seema's Milk Buying Pattern report by Artificial Intelligence

Now, I am pretty sure you were able to answers all the 3 questions above.

Since we now know Seema’s buying behaviour for 10 days, let’s combine both the data points and see if we can better answer the earlier set of questions.

 Deductions based on 6 Days Data Aug 22-27Deductions based on 9 days data Aug 22-28
What Seema BuysSeema buys Milk EverydaySeema buys Milk Everyday
ProductAmul Milk 1L or Goodlife Spl Milk 1LMon-Sat: Amul Milk 1L Sun: Goodlife Spl Milk 1L
TimeBetween 6:30 am to 10:00 am  Mon-Sat: Between 6:30 am to 8:45 am Sun : 10:00 am to 10:10 am
StoreDinesh Store or Amaze Store  Mon-Fri: Amaze Store Sat-Sun: Dinesh Store
PriceRs 45 – 65/- per dayMon-Fri : Rs 45/- Sat : 50/- Sun: 65/-

As you can see, as we got access to more data, the findings became more precise and we can now find a pattern in Seema’s behaviour. This is nothing but learning patterns in the data.

When machine does this job of learning information out of the data that fed into it without human intervention, it is called “Machine learning”. Pretty Cool! Isn’t it?

Scene 2: Reviewing the Store Operations to understand Seema’s buying pattern

Based on Seema’s buying behaviour, can you answer the questions below?

  1. Why does Seema buy Milk from Amaze Store from Mon-Fri and Dinesh Store on Sat & Sun?
  2. Why does Seema pay a higher price for the same milk in the Dinesh store?
  3. Why does Seema buy Goodlife Spl Milk only from Dinesh Store?

The answer is “No”, we don’t know why!

Now, let’s says we were provided with store information below. The answers are now clear, it is simply because the Amaze store is closed on Sat and Sun & Amaze store does not sell Goodlife Spl milk!

Artificial Intelligence Store Information

What we did just now, is to combine 2 different sources of information to understand the reason for certain customer behavior. We now personally know Seema’s reason for her choices, don’t we? The insight that we just found out now is invaluable! You will see why.

The more related data you can find to certain data set, the more powerful your insights will be!

Scene 3:  Is there any relation to Seema’s buying pattern to Stores sales performance?

Let’s take a quick look Store Owner’s profile and their sales performance.

Store Owner Profile and Sales Summary recorded through Artificial Intelligence

Remember the most invaluable insight I mention to you earlier? Now, imagine if Store owner Jeff knew Seema paid a higher price for the Amul 1L milk on Sat? or imagine if Jeff knew Seema went to Dinesh store only because Sham sold one additional product than him?

Scene 4:  Consultant and Data Scientist come to rescue.

Jeff knew if he did not understand the reasons for the drop in sales, very soon he would be out of business. He hired a consultant and data scientist to uncover the problem.

The consultant looked at Jeff’s store and suggested the below solution.

Artificial Intelligence Solutions to revamp amaze store

While bringing up an online store is not a new thing anymore, analyzing customer buying pattern is. This is the job of Data Scientist, the person who can analyze the data to find insights.

If you were to suggest below changes to Jeff based on Seema’s buying pattern, would you agree with the Data Scientist recommendation below?

Artificial Intelligence of buying behaviour

The recommendation above is worth millions of dollars! No amount of worrying and hard work would have helped Jeff improve sales unless he knows what exactly to improve.

This is exactly what Artificial Intelligence is, predicting exactly what price point would interest customer, what products need to recommend to which customer profile? When is the highest probability of converting recommendation into a sale and much more!

All this is possible because companies like Amazon and Flipkart today can store buying patterns of billions of consumers like Seema and then derive insights to improve sales.

Scene 5: Finally, What Strategy does Jeff take after reviewing the recommendation from the data scientist?

Jeff implemented the below plan combining recommendations and his own business tactics.

jeff's action plan based on Artificial Intelligence

What happened to the Amaze store after the changes were implemented did the business sore high or crash down? Did Seema continue to visit Dinesh Stores?  How are giants such as Amazon and Flipkart monetizing the billions of users’ Buying Patterns?

Find out more in Part 2 of this series.

Why it took a pandemic to accept the need to better our socio-emotional skills?

Just like that, the pandemic befell us. It was neither planned, nor foreseen. Seven months into the pandemic, we are still grappling to come to terms with the changes around us. We are forced to live the new normal. How have we been able to cope with it mentally and emotionally? Why are experts now discussing the need for better socio-emotional skills during our childhood?  Why did it take a pandemic for us to accept the same? While the World Health Organization has warned of declining mental health to be the next possible pandemic to envelope the world, it is time we woke up to the need to strengthen ourselves mentally and emotionally.

Where and how do we begin? Brought up as an equal and raised in a household of independent women, I hardly experienced gender inequality or understood ‘what it means to be a girl’ in this patriarchal world until I joined a women’s college. The subtle reminders of one’s gender hit me every day – from wearing our uniform dupatta pleated and properly rested on our chests, to not being allowed to stand on the veranda for too long as our eyes may accidentally cross paths with the boys at the college nearby. Honestly, I didn’t know how to fight and where to begin. Though I did have the position of chairperson of the student body then, I should admit I could make little difference to equate genders or call out wherever it was required.

The thought of working towards an equal world started thus, though it took me close to a decade since then to commence the actual work towards a larger change. An incident that touched me at every sensory level pushed me to research and start work soon. It was in 2010 when my son who was just five years old had an unwelcome brush with a gender stereotype, which raised many questions in me and led to the launch of a socio-emotional learning program in schools and colleges. Phrases and expressions like, ‘cry like a girl’, ‘how can boys cry’, and ‘let her stay indoors as that’s the safest option’ are part of our daily lives. Normally we laugh it off or play our part in endorsing the same. Very rarely do we think of the scar that is left on the child or how one sees gender and the privileges that not everyone has.

First step in building socio-emotional skills framework

To make changes at the ground level, a team was put in place to study the gaps in education and research on ways and means to bring about gender and sexuality awareness in individuals. This led us to begin our training workshops for children as young as 10 years. The transformative years when a child discovers and questions the self, and things around is also the ideal age to introduce variations and differences in gender and how to respect and include every gender into our fold. That is how we started our gender and sexuality workshops which form the core of social-emotional learning. Through these workshops, a child is made to understand the differences in gender and how and why it is of utmost importance to see and treat every gender equally and respectfully. The deep-rooted stereotypes in our lives come out unaware, unplanned, and unwanted. Society has conditioned us to think, act, and behave a certain way. Any deviation from what is the accepted ‘normal’ invites derision and makes us feel guilty most of the time. The change in the accepted norms and conditioning is what we call as the larger change and it must start from every house and school. From not encouraging boys to take up household chores, reminding the girl in the family to learn cooking for better marital prospects, scorning at a transgender in a bus or a metro, the reasons and expressions are innumerable. When the world is moving towards creating equal opportunities and equal spaces, awareness about the same must start as early as possible. And hence began our work towards advocating socio-emotional skills as part of the academic curriculum.

It was not easy for us to breakthrough as managements at many schools considered our socio-emotional learning workshops as unnecessary. They instead preferred to focus entirely on academics, scores, and grades.

With the digital revolution dominating the psyche of a child, the pressure buildup was becoming evident. Depression, anxiety, and suicidal tendencies have risen. As the sole focus of many parents and teachers in India is towards academics, the social and emotional wellbeing of a child is not heeded to. Even though organizations like WHO, UNICEF, and UNESCO had recommended life and social skills as essentials during a child’s developmental phase, they are yet to find a permanent place in the co-scholastic curriculum in schools.

This Covid-19 pandemic and its subsequent repercussions have led educators, parents, and decision makers to alter their thinking and engage in meaningful conversations and discussions revolving better mental health. This thought process had a trickle down effect into various spaces that brought about the realization that for a better and healthy tomorrow, social-emotional health and care needs to be given utmost importance and it has to begin from a young age. From understanding oneself and people around us, breaking stereotypes and conditioning, developing empathy and compassion, to analysing one’s emotions and behaviour patterns, social-emotional learning encompasses all the necessary life-skills that one needs to be adept at for peaceful coexistence. Short term arrangements to handle mental health is not a solution for a healthier future generation. The road to a healthy tomorrow is in making a child understand his/her capabilities and shortcomings at an early age and handhold them in their transformational journey. Socio-emotional skills are the way to building a tolerant and compassionate young gen and the work has to start now.

Antibiotics – “A savior if used judiciously, slayer if not!”

Early diagnosis and judicious treatment of bacterial infection is a must in order to prevent further spread or deterioration.  

With an effort to supervise judicious prescription of antibiotics by clinicians and followed adequately by the patients, “Antibiotic stewardship” program was brought into existence.  Stewardship programs are conducted by infectious disease specialists to create insight into above concerns by ensuring judicious use of antibiotics.

Also read Antibiotics – Diligent Restrained Use For A Secure Tomorrow (Part – 1)

“Judicious use” of Antibiotics – Rule of Five explains all

  1. Right Choice
  2. Right Dose 
  3. Right Interval between the doses
  4. Right Duration 
  5. Right Route (viz., oral or injection)
Five Rules – Right CDIDR !

Right Choice of Antibiotics

Antibiotics – A Magic Bullet; But Not for All! The choice of antibiotic depends on several factors like the site of infection, type of bacteria and so on.  For example, antibiotics prescribed for respiratory infection are different from those prescribed for gut infection.  And, even for respiratory infection, the choice depends on the site of the respiratory system involved.

Right Dose

The amount of antibiotic prescribed differs from patient to patient, especially in paediatrics, where the dose is calculated based on the body weight.  Parents need to be alert while the doctor explains the dosage and be vigilant while buying at the pharmacy.  Commonly noted errors: Syrups are available in different strengths.  E.g., Antibiotic A may be available in two dosages a. 125mg per 5ml and b. 250mg per 5ml; if the doctor has prescribed 5ml of antibiotic , 250mg per 5ml, and parent ends up buying 125mg per 5ml, the parent has inadvertently reduced dosage to half! End result – no response or partial response leading to further complications or drug resistance.

Right Interval

Between the doses: Some are taken once a day, some twice, thrice, or even four times a day depending on the type of antibiotic prescribed and the infection diagnosed.  It becomes necessary to strictly follow the prescription for optimal results.  

Right Duration

Antibiotics are prescribed for a specific number of days depending on the infection.  Many patients/parents fail to follow the exact number of days due to certain misconceptions like, “Off fever = Off Infection” or, suspicious thinking like, “Doctor has prescribed for 10 days, but previous doctor for previous infection had given for 5 days.  Maybe this is an overdose.  Better I shall stop at 5 days.” Or “Bottle empty = Course completed”, the syrups vary in concentration and the volume.  Most of the times, patients may need two bottles.  Parents may buy one with plans to buy the next one later.  By the time one bottle gets emptied, fever settles and parents too!  

Right Route

Antibiotics are given either by mouth or through injections. This “Tug of war” is a very well-known one in most of the in-patient care cases.  Let us say antibiotic injections ( when no oral alternatives are available) are planned for 10 days and by the 7th day child looks fine – this may prompt many to get discharged from the hospital before completing the injection counts. Needless to say this goes against medical advice.

If any of the rules is not obeyed either by the doctor or by the patient/parent, the savior can turn into slayer, either by allowing the bacteria to overpower the situation or by causing adverse effects.

Once the bacteria overpowers the situation, strains start developing resistance to antibiotics.  This forces the physician to go for higher antibiotics.  And, the vicious cycle continues till a day comes when we are left with no further choice of antibiotics.   In fact, we are already in this situation especially while taking care of hospitalized patients.  Antibiotic resistance is a global emergency, as the infections do not respect international borders.  Resistant microbes spread with the spread of population across the world.

Adverse effects – Most of the antibiotics have side effects like vomiting, diarrhoea, and abdominal pain.  Prolonged antibiotic use brings down the immunity, further exposing them to secondary infections like fungal or other bacterial or viral.  These are simple adverse effects. 

Serious antibiotic related life-threatening adverse reactions may happen, though rare – Slayer at its worst!

Heavy on pockets …too!

Higher on the use of antibiotics, heavier would it be on the pocket.  Antibiotics are a costly affair and on top of it they come with adverse effects. Forceful climbing up on the ladder of antibiotic potency, would result in the vicious cycle as mentioned above.  

For example, a simple viral fever could be taken care of with supportive care, which costs nothing but patience.  Adding on a fever control medicine, would cost anywhere between Rs. 10 to Rs. 50 depending on the strength.  Even a simple antibiotic would increase the cost by around Rs. 100 to complete the course. Higher antibiotics may be priced Rs. 250 onwards. The story does not stop here.  Most of the antibiotics cause diarrhea, so many would add probiotics and other supportive medicines to take care of adverse effects.  The fever which could have been treated with small amount may end up in thousands.  If financial costs are the tip of the iceberg, then adverse effects on long term health are the mountain beneath the surface, which may even prove fatal.

As the saying goes, “You cannot clap with one hand.”  It is the duty of both the physician and the patient/parent to judiciously use the antibiotic.  

“A Penny Saved Is a Penny Earned!”

Disclaimer:  The above article is only to create awareness regarding antibiotic use.  The given information should not be used as a substitute for doctor’s consultation in case of any clinical symptoms mentioned above.

Are you a Foreign National worked in India post 2008? You may have large sums lying in your India Provident Fund Account.

Background on Provident Fund regulations

Employees’ Provident Fund Act is one of the important labour legislations in India which provides for retiral benefit in case of non-government employees. The applicability of this Act is mandatory in case of an entity having 20 or more employees at any time during the year. Both employer and employee need to contribute 12% of salary each to this fund. A portion of the employee contribution may go to pension fund depending on the date of joining, wage level and age of the employee. Salary for this purpose excludes House Rent Allowance, Overtime Allowance, Bonus, Commission and similar allowances, perquisites and gifts by employer. In case of an employee whose Provident Fund (PF) wages exceed INR 15,000 has option to restrict the contribution to 12% of INR 15,000 or can opt out of the contributions subject to conditions. Employer would make a matching contribution.

Applicability to Foreign Nationals

Indian Provident Fund laws were amended to make the contributions mandatory in case of foreign nationals effective 01 Nov 2008 with a very few exceptions. Accordingly, an International Worker (IW) working for a covered establishment in India would need to make compulsory contribution to this fund irrespective of their wage level. This means that even if the salary exceeds INR 15,000 it is mandatory for him to contribute to this fund. An IW is defined as a foreign national working for an establishment in India to which the Provident Fund (PF) Act applies.

So, in case of foreign nationals 24% of salary (12% employer and 12% employee) would be contributed to the fund without any cap which could be a sizeable amount. As an illustration, if the monthly salary is INR 500,000 approximately INR 120,000 per month will be contributed to this fund. Further, the fund would fetch a very good interest (8.5% for FY 2019-20) as well. However, there could be a slight variation in the interest rates year on year.


If any of the following applies to an IW, it is not mandatory for him to contribute to the Provident Fund in India.

  • IWs working for an establishment to which the PF Act does not apply, basically an entity having less than 20 employees
  • IWs from social security agreement (SSA) countries contributing to their home country social security
  • Singapore Nationals / Permanent Residents eligible for exemption under the Comprehensive Economic Agreement

Social Security Agreements are bilateral agreements entered by Indian government to avoid double social security contributions. Currently India has effective SSAs with 18 countries and the list of such countries and effective dates are provided in the annexure below . If a foreign national has worked in India prior to the effective date of the SSA, there could have been contributions to the PF fund in India.  As you observe, India still does not have a social security agreement with US and UK.

Withdrawals of Provident Fund

So, what happens to this fund? Can a foreign national withdraw the amount lying in the PF account?    

Definitely ‘Yes’. However, there are certain conditions attached to this. Let us understand what these conditions are.

  • Foreign national from an SSA country can withdraw the amount lying in his Provident Fund account at or after repatriation from India. May also be eligible for monthly pension after retirement as per the SSA. The amount could be credited to the foreign bank account if there is no bank account in India.
  • Foreign nationals from non-SSA countries can withdraw the PF accumulations on attaining the age of 58 years or at the time of repatriation whichever is later. May be eligible for pension if he has contributed for a period of 10 years. Amount will be credited to the Indian bank account only.

Further, if the contributory period is less than 5 years, the withdrawals may be taxable in India as per Indian tax laws subject to relief under Double Taxation Avoidance Agreement. Further, the interest accumulations post repatriation may be taxable even if the contributory period is more than 5 years. However, the treaty relief could be explored here as well.

Annexure – Social Security Agreements with India

CountryEffective date
Czech Republic1-Sep-14
Table showing list of countries with SSA and effective dates

The write-up is for general understanding. We suggest the readers to discuss with their consultants before deciding on their eligibility for withdrawal and related Tax Implications.

Long before the multiplex era, all that existed were single screens. Single screens ranged anywhere from 300 seats up to 1,300 seats from small screen to large 70mm screens. The world of movie distribution has seen huge changes in terms of logistics and transparency.

Also read about dramatic changes brought in by emergence of OTT platforms.

Distributors had two ways to deal with the theatre owners, outright rent for a specified number of shows per week or a revenue sharing basis where the distributor took 70-75% of the total net collections (after taxes).

Moreover, since the movies came in film rolls, they had access to limited number of prints for multiple screens spread across the length and breadth of the region for which the distribution was undertaken.

Theatres sharing the prints would strategically space the shows in a manner in which the film rolls could be transported from one screen to another which was a logistical nightmare. Any glitch would end up in interruption of the movie screening much to the ire of the audience, even worse would be rolls jumbled up practically hampering the experience of the movie watching audience.

Digital era has changed all this and with the advent of multiplexes, movie prints and distribution have become logistically simpler. All you need is a hard drive or a satellite feed that can be decrypted with the help of a KDM (Key Delivery Message), for specific theatres and number of shows.

Distribution is by and large still an unorganized sector in large parts of India. Ticket collections have however, become more transparent in the last decade or so, mainly thanks to consolidation by large multiplex chains. As for single screens, doubts still exist on transparency.

Types of Movie Distribution:

Outright Purchase

A distributor signs an agreement with the producer for a fixed amount for a certain geographical area. The price is arrived at taking into consideration, the population, number of screens and the budget of the movie. Once the distributor has bought the rights, the onus of promoting the movie by way of propaganda is entirely the distributors responsibility. The distributor has to book the theatres well in advance for a specified period and number of shows. Generally, a big budget movie with bigger stars would command a higher price considering the viability of releasing the movie in larger number of screens during the first week of the release. Any profit or loss, would be absorbed by the distributors. In this method, If the movie ends up with a good theatrical run, the distributors end up making more money than the producers.

Price at which a territory sold to the distributor 8 crores
Print, publicity and rental costs 6 crores
Total cost incurred by the distributor  14 crores
Financials – Outright Purchase Method

If the net proceeds (after deduction for taxes) from the theatres exceeds 14 Crores, the distributor makes a profit. Similarly, he will absorb the loss. Sometimes, the theatre rentals are substituted with sharing of the proceeds between the theatre owners and the distributors. 

Minimum Guarantee

In this method, producer gives the rights of distribution for an agreed amount. In case, the distributors profit share crosses this amount, the producer and the distributor will share the profits made over and above the agreed amount. In case of a good run, producers and distributors both make money. This is typically used by huge production houses. Price at which a territory sold to the distributor, say 10 crores . In case the proceeds exceed 10 crores, the distributor and producer share the profits at an agreed percentage.


This is a method where the burden is totally on the producer. In this case, a distributor pays a fixed amount of money (refundable) to the producer to screen the movies in a certain geographical area. On screening the movies, the net collections from the theatres are given back to the producer. The producer gives an agreed amount of commission on the collections. At the end of the theatrical run, the advance is returned to the distributor. This method is usually adopted for small budget movies, with limited prints and small number of screens. The commission to the distributor differs based on the collections. If the collection exceeds the advance amount initially paid, the commission would also be higher. Based on the response to the movie, the producer has the liberty to change the method of distribution for other geographical areas.

Advance paid by distributor to the producer for a territory   2 crores
Net proceeds collected by the distributor  4 crores
Commission paid by producer to the distributor  (10% of net proceeds) 0.4 crore
Producer will refund the commission along with the advance to the distributor 2.4 crores
Financials – Distribution Method

In case the net proceeds are less than 2 crores, the distributor gets back the advance in full either without interest or a minimum rate of interest. In this case, the distributor is more like a financier.