POVERTY

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The fruits of economic growth have not benefited everyone uniformly. Some are left behind and some others are not touched by the benefits of economic growth. These some when combined together define poverty. Poverty is the lack of basic human needs like health, education, clean water, nutrition etc. It is a condition in which one’s income is not sufficient enough to fulfill his basic needs. It is curse and something like nobody would want to own. Laster R. Brown in his book ‘World Without Borders’ explains poverty thus; “Unfortunately it is not an economic abstraction, it is a human condition. It is despair, grief and pain. It is the despair of a father with a family of seven children in a poor country when he joins the, swelling ranks of unemployed with no prospects of unemployment compensation. Poverty is the longing of a young boy playing outside a village school but unable to enter because his parents lack a few rupees needed to buy text books. Poverty is the grief of parents watching a three year old child die of a routine childhood disease because they cannot afford any medical care.”

Poverty exists because the economic system is organized in ways that encourage the accumulation of wealth at one end and creates conditions of scarcity that make poverty inevitable at the other. Rich in the society are getting richer; poor are getting poorer. Poverty is both a structural aspect of the system and an ongoing consequence of how the system is organized. In developing countries the poverty stands as the major obstacle in development. The primary reason as a cause of poverty is education. In a country like India one-third of the country’s population is still illiterate and a majority is not educated up to the age of 15 years. Even among the educated, everyone does not have employable skills of the modern economy. The education system is not tuned to the changing economic scenario. The large agriculture workforce in rural areas is not sustainable with dwindling cultivable land and use of modern methods of cultivation. As a result, the rural labour is pushed into cities in search of work but they do not have any employable skills in the urban formal sector, and thus they often end up doing odd jobs in urban areas.

Developing nations around the world are getting financial help from more Industrialized nations. But still poverty is a problem in developing nations. One of the reason is, this money that people receive in the form of aid solves the short term problems like food for a week or month. The long term impact is nil. One should not forget the corruption level in these less developed nations. Most of the money goes to the bank accounts of politicians of that country. For these reasons, financial help alone does not solve poverty problem in developing nations. Government employs many poverty alleviation programs to get rid of this malignance. Involvement of the local communities is the key to the success of poverty alleviation programs. In the absence of community involvement, the programs are plagued with bureaucratic muddle and corruption at every level. At the macro-level, there is a need to co-ordinate a myriad of poverty alleviation programs of the central government and the State governments. The transfer of central funds to the States for different programs should be efficient. Currently, such funds and goods like food grains are not fully utilized by the States. There is a need to strengthen the financial management capacity of certain States to use the funds efficiently.

Social problems are more than an accumulation of individual woes, they can’t be solved through an accumulation of individual solutions. We must include social solutions that take into account how economic and other systems really work. We also have to identify proper steps to curb with this problem. To understand where poverty comes from, what makes it such a stubborn feature of social life, we have to begin with the simple sociological fact that patterns of inequality result as much from how social systems are organized as they do from how individuals participate in them. Poverty is more of social marginalization of an individual, household or group in the community/society rather than inadequacy of income to fulfill the basic needs. Indeed, inadequate income is one of the factors of marginalization, but not the sole factor. The poverty alleviation programmes and other measures to get rid of poverty should not aim merely to increase the income level of individual, household or group, but mainstreaming marginalized in the development process of the country.

 

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Rural Marketing : Are companies finally taking the rural customers seriously?

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“The future lies with those companies who see the poor as their customers.”  

 In the recent years, with the expansion of overall economy and increased purchasing power of the rural communities, rural markets have gained considerable significance. Rural markets, as part of any economy, have untapped potential. Companies tend to see this as an opportunity to broaden their horizons and take the road less traversed. The managers have now recognized that to build real sales volumes they will have to reach outside the big cities.

  In several categories, rural India already accounts for the lion’s share. According to MART, a New Delhi-based research organization that offers rural solutions to the corporate world, rural India buys 46% of all soft drinks sold, 49% of motorcycles and 59% of cigarettes. This trend is not limited just to utilitarian products: 11% of rural women use lipstick. In 2001-02, LIC sold 55% of its policies in rural India. Of two million BSNL mobile connections, 50% are in small towns / villages. Of the 6.0 lakh villages, 5.22 lakh have a Village Public Telephone (VPT).41 million Kisan Credit Cards have been issued (against 22 million credit-plus-debit cards in urban), with cumulative credit of Rs. 977 billion resulting in tremendous liquidity. Of the 20 million Rediffmail sign-ups, 60% are from small towns. 50% of transactions from these towns are on Rediff online shopping site.42 million rural households (HHs) are availing banking services in comparison to 27 million urban HHs.Investment in formal savings instruments is 6.6 million HHs in rural and 6.7 million HHs in urban.

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What makes rural marketing so attractive is its sheer size, 742 million people or around 60 percent of total population. Apart from this the penetration level is insignificant in comparison to the urban market that means very less competition. With the increased MFIs and Banks being set up in rural areas, credit is easily and readily available. Companies have started introspecting and coming up with the plans to woo to the market where the future lies. Several European multinational firms and a few U.S. firms have been making inroads into rural India for years.

  Companies such as Unilever, Phillips and Nestle have long been known to India’s rustic dukaandaars, or merchants. Among U.S. firms, companies such as Colgate and Gillette have made considerable headway. Marketing to rural customers often involves building categories by persuading them to try and adopt products they may not have used before. A company like Colgate has to build toothpaste as a category, which means convincing people to change to toothpaste instead of using neem twigs to clean their teeth, which was the traditional practice.

  With the improving infrastructure, electricity, literacy rate and social status, a lot of firms are trying to understand and cater to the rural consumers and customers. Rural India buys Products more often (mostly weekly).Buys small packs, low unit price more important than economy. In rural India, brands rarely fight with each other; they just have to be present at the right place. Many brands are building strong rural base without much advertising support.Chik shampoo, second largest shampoo brand. Ghadi detergent, the third largest brand. Fewer brand choices in rural areas; number of FMCG brand in rural is half that of urban.The problem arises with the distribution of these products in rural market but that too has been handled by initiatives like ITC’s e-Choupal and HUL’s Shakti.

 With help from Shakti distributors, Hindustan Lever has been able to reach rural consumers in thousands of remote Indian villages. According to media reports, Shakti distributors now account for 15% of the company’s sales in rural India. The opportunity is enormous as the brand loyalty is more in case of less affluent consumers. While the eChoupal network was initiated to facilitate more efficient and effective procurement, the connectivity both physical and informational between the farmer and the market that it facilitated has allowed ITC to use it for distribution of goods and services from the market to the farmer.

 The opportunities lie not only in case of FMCG but also in case of automobiles, banking, electronics, telecommunication and service industry. The companies can use the existing infrastructure like     Post Offices(1,38,000 ),Haats(42,000), Melas (exhibitions 25,000 ), Mandis (agri markets 7,000 ),Public Distribution Shops(3,80,000), Bank Branches(32,000) for their promotion and as distribution centres. Enough research is being done on the ways in which companies can reach to their consumers instead of the consumers reaching to the firms.

 Thus, looking at the challenges and the opportunities, which rural markets offer to the marketers, it can be said that the future is very promising for those who can understand the dynamics of rural markets and exploit them to their best advantage. A radical change in attitudes of marketers towards the vibrant and burgeoning rural markets is called for, so they can successfully impress on the millions rural consumers spread over approximately six hundred thousand villages in rural India and thousands of small towns.

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Angela Merkel: a woman of power  

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Angela Dorothea Merkel is a German politician who has been Chancellor of Germany since 2005, and the Leader of the Christian Democratic Union (CDU) since 2000. She is the first woman to hold either office.She is the third longest-serving leader after Jean-Claude Junker of Luxembourg, and Andrus Ansip of Estonia.The former scientist – daughter of a Protestant clergyman, brought up under communist rule in East Germany, who now dominates not only the domestic politics of her reunited homeland but also the interminable crisis-management of the EU – is cool and controlled.Fixing the crisis in the Eurozone has become the touchstone of her entire political career. It is a historic challenge, but she tackles it as a fundamental scientific problem to be solved, stubbornly and consistently. 

She is called a Machtfrau in Germany – a woman of power – who has managed to get to the top as an outsider in a male-dominated world, removing all her potential rivals on the way and now reveling in popularity ratings ahead of any other politician in the land. No one seriously disputes that Merkel is today the most powerful politician in Europe. Forbes magazine just declared her the second most powerful figure in the world, after President Obama.

It’s a trick not every political leader can pull off: put some 420 billion euro on the European table to protect Europe’s weakest economies from default and remain your country’s most popular politician. That’s what Angela Merkel has managed. Despite having made unpopular concessions to Greece only a few days earlier, delegates of her Christian Democratic Union (CDU) re-elected her as party leader with close to 98 percent support last week. Her public approval ratings remain north of 60 percent, and the trust that German voters have in Merkel’s management of the euro-zone crisis puts the Chancellor and her party in a strong position ahead of general elections next September.

The reason behind these impressive figures is that Merkel’s mix of strong commitment to Europe on the one hand and the push for structural reform in southern Europe on the other exactly reflects the policy preferences of the average German voter. Divert too far from this path to the right, as Merkel’s junior coalition partner, the Liberals, attempted in some regional election campaigns last year, and German voters will punish you for your lack of European solidarity. Step too far to the left, like opposition Social Democrats (SPD) have tried with calls for Euro-bonds and a debt redemption fund, and voters lose trust in your ability to defend the German taxpayers’ interests. In the middle stands Merkel. Her calm, approachable persona and her centrist incrementalism have persuaded German voters that two conflicting goals can be achieved: Save Europe and limit the financial burden on Berlin.

She went into politics, she says, because she was convinced that eastern Germany needed more people in parliament who had never been politically active. The falling of the Berlin Wall in 1989 and the end of the Cold war had a huge impact on her life.Though she denies having any political passions, she does agree on having political themes. The challenge of globalization is one, and the need for more competitiveness – especially in Europe – to meet it.As a politician she wants to understand problems fundamentally- and not just what she needs to know to survive another week in politics. She is also formidably hard-working. Yet for all that is known about her, Angela Merkel remains an enigma.

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Posted by Yogita Kapoor Monday, August 29, 2016 03:10:00 PM 

GST – AT A GLANCE

The introduction of Goods and Services Tax (GST) would be a remarkable step in the reform of indirect taxation in India. As the name suggests, GST is imposed when a consumer purchases any goods or services. This bill will be India’s biggest tax reform since independence as it will untangle the current taxation policy by integrating all indirect taxes(sales tax, VAT etc) with sole tax

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From the consumer point of view, the immense edge would be in terms of a reduction in the overall tax liability on goods, which is presently evaluated at 25%-30%, free movement of goods from one state to another without obstruction at state entrance for hours for payment of state tax or entry tax and relaxation in paperwork to a monstrous extent.

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Many taxes has been subsumed GST which are as under:

Central Indirect Taxes & Levies:

  • Central Excise Duty
  • Excise Duty levied under the Medicinal Preparations (Excise Duties) Act, 1995
  • Service Tax
  • Additional Customs Duty (CVD)
  • Central Surcharge and Cess

State Indirect Taxes & Levies:

  • VAT/Sales Tax
  • Entertainment Tax (other than the tax levied by local bodies)
  • Central Sales Tax
  • Octroi & Entry Tax
  • Purchase Tax
  • Luxury Tax

 

Favorable Aspects:

  1. The major purpose to execute GST is to remove the cascading effect on tax. A product on which excise duty is paid can also be liable for VAT. Suppose a Product A is manufactured in a factory. As soon as it releases from factory, excise duty has to be paid to central government.  When that Product A is sold in the same state the VAT then VAT has to paid to state government. Also no credit on excise duty paid can be taken against output VAT. This is termed as cascading effect since double tax is levied on same product.

 

  1. The GST is being instigated to create a standard market across states, not only to avoid crippled effect of indirect tax but also to refine tax compliance.

 

  1. GST will conduct a better explicit and unbiased manner to increase revenue.

 

  1. Cost depletion as credit of input tax is available against output tax.
  2. Untangled and price saving system as procedural cost reduces due to uniform accounting for all types of taxes. Only three accounts, CGST, SGST, and TGST have to be maintained.

 

  1. GST is build to untangle the present indirect system. It is long term plan leading to a higher output, more employment opportunities and economic boom.

 

  1. GST is favorable for both economy and corporate. The depleted tax load on companies will diminish production cost making exports more aggressive.

 

Unfavorable Aspects:

  1. GST is being mentioned as a sole taxation system but in actually it is a two fold  tax in which state and center both  accrue separate tax on a sole transaction of sale and services.

 

  1. At present the main tax indirect system of Central Government excise. All the goods and commodities are not covered by the central excise and further there is an exemption limit of Rs. 1.50 Crores in the central excise and further traders are not liable to pay central excise.   The central excise is payable up to the stage of manufacturing ,but now GST is payable up to sale.

 

  1. Most of the dealers are not covered with central excise but are only paying VAT in the state. Now of all the VAT dealers it will be mandatory to pay “Central Goods and Service Tax”

 

  1. The calculation of RNR ( Revenue Neutral Rate) is very difficult and further Govt. wants to intensify  its revenue hence rate of Tax will be problem. As per the news reports the propounded rate for state GST is 12% and Central GST is 14% plus Govt. wants to impose 1% CST  at the primary stage of GST on the interstate sale of goods and services. So the common rate of overall tax will be 26%. The rate is very high collating to the fact that small and medium industries are at present not covered by central excise and most of the goods such as agricultural products are out of the preview of the central excise.

 

  1. Advancement in the manufacturing and distribution of goods, increase in exports, various reforms, check on corruption, less government control are some of the components responsible for the economic growth of the country. A tax system can make revolution in the economy of the country is “rarest of the rare” thing.

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CAT 2016 Notification by IIM – Banglore

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One of world’s toughest entrance exams and probably the most competitive PG entrance exam,  The Common Admission Test (CAT 2016) has announced it’s dates. With the addition of new IIMs and more non-IIM colleges accepting the CAT score, the challenge is to maximise your score and excel in the exam.

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Guideline for Registration & Payment:

  • The application window will starts from Monday, August 8, 2016, 10 AM onwards.
  • The application fee has increased from Rs. 1600 to Rs. 1700 for General and NC-OBC candidates and Rs. 850 from Rs. 800 for the reserved category candidates.
  • Candidate should have log on Official website http://www.iimcat.ac.in.
  • Read “Advertisement notification of CAT 2016”.
  • After it, you must register yourself by enter required details.
  • Now you should fill the details.
  • Pay now your cat 2016 application fee.
  • Candidates must pay the registration fee through online mode only, including Credit Card, Debit Card, and Net Banking.
  • After submission of Application, candidates will be permitted to download their Admit Card from October 18, 2016 onwards, till the date of examination.
  • The test will be conducted across 138 cities in India. The candidates have to select 4 cities in order of preference on the basis of which their exam centre and slot will be allotted to them.

Eligibility Criteria:

  • Interested Candidates must holds a genuine bachelor’s degree with any discipline and secured minimum 50% marks or its equivalent CGPA. In case of SC/ST/DA (Differently Abled), then the minimum marks secured by candidate is 45%
  • Appearing candidates are also qualified to apply but will have to submit their original degree certificate during final process.
  • There is no age restriction in order to appear in CAT 2016.
  • Applicants who hold a degree recognized by Ministry of HRD, Government of India are also eligible to apply.

TOP INSTITUTIONSACCEPTING CAT SCORE:

Indian Institute of Management, Banglore

Indian Institute of Management, Ahmadabad

Indian Institute of Management, Calcutta

Department of Management Studies, Indian Institute of Technology, Delhi

Faculty of Management Studies, University of Delhi, Delhi

SP Jain Institute of Management and Research, Mumbai

Indian Institute of Management, Lucknow

Indian Institute of Management, Kozhikode

Institute of Management Technology, Ghaziabad

Management Development Institute, Gurgaon

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Posted by Yogita Kapoor, Wednesday, Aug03, 2016 12:25:00 PM Categories:

Notification : NMAT 2016

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Guideline for Registration & Payment:

  1. Create an account on nmat.org.in using a valid email address.
  2. Provide contact information, personal, educational and work experience, the list of programmes to send scores, and the ID that you will use at the test centre.
  3. Your name and date of birth that you enter on the registration form must exactly match the name and date of birth on your primary and secondary ID.
  4. Choose the schools to send your scores under the “Schools Preference” section. Up to 7 programmes are included in your registration fee. An additional fee of INR 200 + applicable taxes will be applied for each programme added in excess of 7 programs.
  5. You must upload a photograph that bears likeness to you and the photograph on your primary ID. This photograph will be included on the admit card that you must bring.
  6. Pay the test fee.
  7. Once your payment is realized, your schedule exam option will be activated in your dashboard, so that you can go ahead and schedule your exam.
  8. You will be able to download your admit card from your dashboard once the payment is realized.

Number of Retakes

You are allowed to take the NMAT exam a maximum of 3 times during the year’s testing period. This will include the first attempt plus a maximum of two retake attempts. No shows are considered attempts.

Retake registration option will be enabled in your dashboard after your exam date. You need to register for the retake by simply clicking on the Retake section and pay the retake registration fees. You don’t have to fill in the details again. Once your registration for the retake is complete and retake registration fees is realized you will be able to schedule your retake exam.

While you can register for retake exam after your exam date, however you can schedule the retake exam date 15 or more days after your most recent date of attempt. This means you will have to wait at least 15 calendar days before you can appear for a retake. You can schedule your test any time during the retake scheduling window (subject to real time availability). You will be able to select any slot that is a minimum of 24 hours later than the time you schedule your appointment.

Reschedule

You can reschedule your appointment if you can’t appear for the original test appointment. You may reschedule your appointment up to 72 hours prior to your original appointment. You may pay for your reschedule using credit card only.

NMAT SCORE ACCEPTING INSTITUTIONS:

  • SVKM’s Narsee Monjee Institute of Management Studies
  • ICFAI Business School (IBS)
  • Alliance University
  • SRM University
  • BML Munjal University
  • VIT University
  • Ansal University
  • Mody University
  • Shoolini University
  • Thapar School of Management
  • Woxsen School of Business Management
  • Amity University
  • Chitkara University
  • University of Petroleum & Energy
    Studies (UPES)
  • Hyderabad Business School, GITAM University
  • Institute of Management, JK University, Jaipur
  • Shiv Nadar University
  • GITAM School of International Business, Visakhapatnam

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Posted by Yogita Kapoor, Saturday, July 30, 2016 12:20:00 PM