by admin | May 25, 2021 | Opinions
By Rahul Agarwal,
In this age of instant gratification — especially among the young and salaried (Gen Y) individuals — buying a big budget item is almost hassle-free. They can easily be bought with little to no down payment and banks and other financial firms line up with attractive offers and EMIs that are sometimes too hard to ignore.
However, to reach an objective conclusion between the choice of saving now to buy a big budget asset later, over buying something right away on EMIs, one needs to evaluate various pros and cons regarding the purchase.
First and foremost is the differentiation between want and need: If you want something, then, in most cases, you have the luxury of time to plan and save for the same; on the other hand, if the item you are planning on buying is an actual and immediate need, then buying the item upfront with cash or financing it’s purchase and paying an EMI is a feasible option.
Besides the fact that buying an asset through loans increases your indebtness, there are other important factors or situations that occur due to buying on loans:
Added financial obligation: Financing through EMI results in creating long-term debt and commitments which, if not honored, can cause problems.
Extra cost to be paid: Every EMI has two parts, principle and the interest; the interest part is extra cost that one has to pay to own an asset. The longer the duration of the loan, the higher is the cost of acquisition of the asset.
Opportunity cost: Owning an asset through financing does entail an opportunity cost in the form of the interest one pays in owning the asset. In doing that, one forgoes the opportunity to invest the same amount and earn interest and generate income
Losing financial freedom: Having to pay a certain amount every month towards an existing EMI leads to loss in financial freedom; not paying or delaying payments leads to fines and fees and negatively impacts one’s credit history, thereby restricting access to credit in the future or during emergencies. Once in debt, all the financial planning for one’s free cash flow after basic expenses is focused on first paying of the debt, therefore restricting one’s legroom for making financial decisions.
The economic sense to buy an asset only after saving for it, rather than buying it through a loan, can be better understood through an example. The basic assumption is that the big budget item that one is planning on buying is not an immediate need and the buyer has at-least two to three years to plan and save for the purchase.
It can thus be seen that the effective cost that one pays through the EMI route is almost 30 per cent higher than the scenario in which one first saves and then buys. The primary reason for this difference is that in the first cast one is spending money as interest on the loan whereas in the second case one is accruing interest thereby reducing his/her cost of acquisition.
The example clearly establishes that saving first and then buying a big-ticket item is always a better option as opposed to taking a loan and buying it right away.
One, of course, will be denied the pleasure of instant gratification and would have to wait to own the asset; but at the same time, the savings thus realised are significant and can be used to buy a smaller item or can be used for other productive purposes at zero upfront cost. This further reinforces the fact that postponing expenses creates wealth, whereas advancing the date of their purchase leads to erosion of wealth. This basic personal finance tip can help individuals build long-term wealth through small steps.
(Rahul Agarwal is Director Wealth Discovery/EZ Wealth. The views expressed are personal)
—IANS
by admin | May 25, 2021 | Entrepreneurship, Investing, Startup Basics, Venture Capital
New Delhi : Global entrepreneurial mentoring network Techstars on Monday announced to open its first mentorship-driven accelerator in Bengaluru to nurture Indian start-ups in the emerging technologies.
To begin with, the Techstars accelerator in India will invest $120,000 each in 10 start-ups working in fields like Artificial Intelligence (AI), Blockchain, AR/VR, Robotics, Internet of Things (IoT) and Big Data Analytics.
“The aim is to help solve problems in sectors like food tech, agriculture, retail, banking, healthcare, manufacturing, public sector and transportation.
“We will help Indian entrepreneurs connect with mentors with the ability to bring step change improvements to their startup journeys,” Ray Newal, Managing Director of Techstars accelerator in Bengaluru, told IANS.
The Bengaluru accelerator will begin operations from February 4, 2019 and culminate on May 2.
“The applications to select 10 start-ups are now open and will close on October 14,” Newal informed.
The Techstars community now includes more than 10,000 mentors and through its mentorship-driven accelerators, it has invested in 1,375 companies from more than 40 countries.
“It is my priority to provide founders in India with the tools they need to succeed in their journeys, whether it be qualified advice, capital or simply access to the right people,” said Newal.
Techstars founders connect with other entrepreneurs, experts, mentors, alumni, investors, community leaders, and corporations to grow their companies.
The Colorado-based network operates three divisions: Techstars Startup Programmes, Techstars Mentorship-Driven Accelerator Programmes, and Techstars Corporate Innovation Partnerships.
Techstars accelerator portfolio includes more than 1,300 companies with a market cap of $13.9 billion.
“The entrepreneurs are not unique to India but can be found in any developing country like Brazil, Indonesia, Nigeria and the Philippines,” said Newal.
—IANS
by admin | May 25, 2021 | Business, Corporate, Corporate Buzz, Economy, Investing, News, SMEs
By Vishal Gulati,
Bad Kreuznach (Germany) : Tapping renewable energy is a major economic opportunity for developing economies like India. There is a master plan to clean up cities and this would lead to more jobs. But we need to invest, says German environmental and energy consultant Peter Heck, who believes the corporate world is taking money out of the carbon-related business.
It is all about how to use resources with the highest most efficiency. This is also referring to money.
“India needs a plan for all states and all villages with technical proposals and investment demands. And suddenly the whole ‘problem’ turns into a huge ‘develop India’ venture,” Heck, who is the Managing Director with the Institute for Applied Material Flow Management in Trier University of Applied Sciences, told IANS in an interview.
“Look at all the biomass you are throwing into landfills. Millions of litres of oil polluting the environment. This could be energy and fertilizer.
“If you do the numbers on a large scale, you will see (the solution). The problem is the complexity of opportunities, i.e., fertilizer, energy, environment protection, local jobs plus climate protection. All this has to be calculated together.”
Heck was in this spa resort, located in the Nahe Valley just 40 km from Rhineland-Palatinate’s capital of Mainz, for interacting with visiting journalists from across the globe.
People in Germany’s small towns and rural areas, through energy cooperatives, are turning to renewable energy and this is a new business model for sustainable growth to limit manmade climate change along with strengthening regional purchasing power.
For Heck, who was energy consultant for the city of Dormagen and the municipality of Wallerfangen, renewables are not only a major economic opportunity but a big chance to decentralise development and local added value, if properly done.
“The use of solar-powered water pumps in India could save millions of rupees for the provincial governments, which could use this money for education or more investment in renewable energy,” he maintained.
On some of India’s most polluted cities in the world, the energy consultant said shifting investment towards renewables will help the economy.
“Well I could easily provide your government with a master plan for cleaning up your cities. This plan would lead to more jobs, less expenses and clean environment. But we need to invest. Examples from China (in the initial stages) exist.”
Targets should be more ambitious in order to push the country’s technical and scientific brains, he said.
Aim for 100 per cent and make a proper time schedule. That’s what Germany did and so far, all parties have stuck to 2050 as the final date for goodbye to fossil fuels.
“In Germany, we have government programmes helping companies to reflect on their consumption and their opportunities in the market with the help of efficiency and renewable energy. (Investment advisory) DEG is offering RECs (resource efficiency checks) for companies as a customer service,” Heck said.
On high emissions in China, he said: “China will consequently improve because of industrial policy strategies. They got the numbers and the opportunities and will do it. Unfortunately, they will also continue to sell coal to Africa and Asia together with old technology.”
“But in China, despite the nightmare situation, we have seen a change. We work for companies in Beijing and they really face serious pressure from the government to reduce consumption and carbon emissions.”
“India has low industrial development. You have the unique chance to avoid all the mistakes and misallocations of capital by opting for a shortcut in energy supply. It would greatly help to fight poverty and push India technically and scientifically,” he said.
Companies are aware and are investing directly for own supply or in divestment, i.e., taking money out of carbon-related business, an optimistic Heck said, adding: “The fossil ones will be the losers.”
The 2018 National Electricity Plan sets India on a similarly ambitious trajectory of a staggering 275 gigawatts of renewables by 2027.
(Vishal Gulati was in Germany for a media study tour of the Clean Energy Wire or CLEW. He can be contacted at vishal.g@ians.in)
—IANS
by admin | May 25, 2021 | Business, Investing, Large Enterprise, Muslim World
Economy Minister Nihat Zeybekci
By Ali Atar,
Istanbul : Economy Minister Nihat Zeybekci on Wednesday urged Saudi business community to invest in Turkey.
Speaking at the Turkey-Saudi Arabia Business and Investment Forum in Istanbul, Zeybekci told Saudi business community to “come, invest in Turkey — the fastest growing country in Europe.
“Let us produce together and sell together to Europe and the world.”
He predicted Turkey would experience “incredible improvements over the next 10 years”.
“No country in the world offers great opportunities as Turkey promises. No country in the world will be able to double its current energy consumption in the next 10 years.
“No country in the world will invest $150 billion alone in the transport sector over the next 10 years. No country in the world will invest more than $100 billion in its health-related transformation over the next decade alone,” he added.
The minister said Turkey and Saudi Arabia would be among fastest growing countries in the next 10 years as he pointed out Turkey’s vision for 2023 ad Saudi’s vision for 2030.
“Both the Turkish and Saudi Arabian economies are undergoing technological and sectoral transformation…”
Ankara to boost cooperation
He said Ankara was enhancing its cooperation with Riyadh in construction, logistics, agriculture and tourism sectors.
“There are great opportunities , especially in the field of petro-chemistry. We are growing so fast that our finances are not enough for us,” according to Turkish minister.
He also asked the Turkish business community to participate in Saudi Vision 2030.
“You must take part in Saudi economy that is aiming to pass through major transformation in the next decade. Take part in vision 2030 of Saudi Arabia because you will win, you can be sure of that.
“During this development in Saudi Arabia you will also grow exponentially, you will develop.”
Prior to the closing session of the forum, Turkish minister held a meeting with Saudi Trade and Investment Minister Majid bin Abdullah Al-Qasabi.
Saudi Arabia’s 2030 vision lays out a blueprint for the kingdom’s long-term goals and expectations, reflecting its strengths and capabilities. Saudi Arabia’s General Investment Authority Head Ayidth Al-Otaibi explained that they are seeking around $30 billion in investment per year to be able to achieve the vision.
As part of Turkey’s vision for 2023, which marks the centenary of the Republic of Turkey, the country has set specific goals and targets that include major improvements in the economy, energy, healthcare and transportation.
—AA
by admin | May 25, 2021 | Business, Investing, Large Enterprise, Markets, Technology
New Delhi : Unveiling its Internet of Things (IoT) vision and strategy, Dell Technologies on Thursday said it will invest $1 billion in new IoT products, solutions, labs, partner programmes and ecosystem over the next three years.
“IoT is fundamentally changing how we live, how organisations operate and how the world works,” Michael Dell, Chairman and Chief Executive Officer of Dell Technologies, said in a statement.
“Dell Technologies is leading the way for our customers with a new distributed computing architecture that brings IoT and artificial intelligence together in one, interdependent ecosystem from the edge to the core to the Cloud,” the Dell CEO added.
As part of its new IoT strategy, the Round Rock, Texas-headquartered company also announced a new IoT division as well as new IoT specific products.
“As per NASSCOM, the global market for IoT in 2020 will be worth $373 billion in revenue, with India accounting for $10-12 billion of this revenue,” said Rajesh Janey, President & MD, India Enterprise, Dell EMC.
“India is currently undergoing a massive transformation to become a digitally enabled nation; and technology is at heart of this digital transformation. Smart cities, IoT, building a modern architecture, connecting devices – all these are building blocks of achieving the goal of realising a digitally transformed India,” Janey added.
The company’s new IoT Division will be led by VMware CTO Ray O’Farrell, and is chartered with orchestrating the development of IoT products and services across the Dell Technologies family.
The IoT Solutions Division will combine internally developed technologies with offerings from the vast Dell Technologies ecosystem to deliver complete solutions for the customer.
“Our new IoT Division will leverage the strength across all of Dell Technologies family of businesses to ensure we deliver the right solution – in combination with our vast partner ecosystem – to meet customer needs and help them deploy integrated IoT systems with greater ease,” O’Farrell said.
Dell Technologies family of brands include Dell, Dell EMC, Pivotal, RSA, Secureworks, Virtustream and VMware.
“In India, IoT is increasingly gaining importance in any modern organization’s digital transformation story. It has unleashed a whole new world of possibilities by connecting the physical and digital worlds, that can transform customer experience, create new business models and improve business agility,” said Arun Kumar, MD, VMware India
“To the Indian customer, looking to take advantages of all that is possible with IoT, we can offer the combined technology expertise of Dell and VMware and apply it at the edges of the business where all things reside and help Indian organizations manage the next stage of their evolution,” Kumar added.
—IANS
