Vitta Artha - Winter Edition'20

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CONTENTS 1. Foreword Prof. Nagarajan Ramoothy (Director IIM Amritsar)…………………………………………..3 2. Capital Structure Choice, Information Asymmetry, and Debt Capacity Surender Rao Komera (Assistant Prof. IIM Amritsar)………………………………………………..4 3. Union Budget 2020-21: Foundation for a consumption led growth Dr. S. P. Sharma (Chief Economist, PHDCCI)…………………………………..………………...6 4. Corona Virus reaches Dalal Street.

Aditya Gurjar (IIM Amritsar)………………………………………………………………….…….9 5. India Becoming a Global Manufacturing Capital Nitish Raj (IIFT Delhi)…………...………………………………………………………………….11

6. Opting Out of RCEP : Does India Need to rethink it’s Decision Nishant Kumar Satyam (IIM Indore)……………….………………………………………………..13 7. The Role of Foreign TPO and it’s Future Prospects in India Parul Mehta (MDI Gurgaon)..………..……………………………………………………………..17 8. Insights from Achievers CFA : Rishabh Puri (PGP 04)………………………………,,,,,,,,,,……………………………..23 FRM: Shubham Khandelwal (PGP 04)……………………………………...………………………25 FRM: Puneet Gupta (PGP 04)………………………….…………………………………………..27 9. Internship Experiences……………………………………………………………………..28 10. Golden Investment Fund………………………………………………………………….30 11. Club Activities………………………………………………………………………………..32 12. Achiever’s Corner…………………………………………………………………………..34 13. Team FEC……………………………………………………………………………………...35 14. Crossword…………………………………………………………………………………….36

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FOREWARD

PROF NAGARAJAN RAMAMOORTHY (Director, IIM Amritsar)

I am glad to announce that the Finance and Economic Club (FEC) is ready with its fifth edition of Vitta Artha. FEC is evolving as it diligently strives to improve the cognizance of financial and economic events among the students. Finance, as we know, is not only limited to mere transaction systems but is spread across the world in various forms of corporate and project valuations, mergers and acquisitions, and well beyond equities, debt and commodity markets. This edition of Vitta Artha dives deep into various macroeconomic parameters and their significant impact on the finances of India and the world.

There are numerous factors in influencing these events such as India’s increasing exposure to the global markets, US-China trade war, the brunt of the environmental calamities recently experienced by Australia, Brazil and various states in India and the spread of novel Coronavirus that has almost brought the major exporter of the world, China to a halt. A finance enthusiast is always curious to know the current macroeconomic scenario so as to gauge the impact of the happenings on one’s day-to-day life and also on one’s business firm. Every cloud has a silver lining. So, even with all the challenges that the world has to go through, the world of finance has witnessed a series of innovations in India and around the globe. There are numerous start-ups working in fields of MSME, helping them raise funds. At the same time, these start-ups provide loans to local vendors and also issue them a credit-rating to offers loans at attractive rates.

The magazine also covers interviews from industry experts as well as insights from students who cleared FRM from our institute. I hope this issue of the magazine helps in building curiosity about finance and economics.

The special article for this issue talks about the Union Budget 2020-2021 and its impact on the various sectors of the Indian Economy. Analysis of the contemporary financial world and implications of these effects is critical for budding managers to foresee future possibilities and plan accordingly.

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SURENDER RAO KOMERA A

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Capital Structure Choice, Information Asymmetry, and Debt Capacity: The Indian Experience How do firms finance their operations? What proportion of debt and equity should be issued to meet their financing requirements? Addressing these contentious questions is very crucial for firms’ financial managers. These decisions are increasingly challenging if the firms are operating in emerging markets. Emerging markets are known for their improperly defined property rights, moderately liquid capital markets, and underdeveloped regulatory and bankruptcy mechanisms (Khanna and Palepu, 2010).

Following the seminal papers of Modigliani and Miller (1958, 1963) suggesting that, but for the taxadvantage of debt, capital structure is irrelevant to firm value, the understanding of firm’s financing behaviour has attracted much debate and mixed empirical findings. They are conventionally classified as trade off theory and pecking order theories of capital structure. The trade off theory predicts that firms operate at their optimal capital structure, by trading off between costs (potential distress costs) and benefits (tax savings) of debt financing (Kraus and Litzenberger, 1973). Pecking order theory argues

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that asymmetric information costs are the key drivers of firms’ financing choices (Myers, 1984; Myers and Majluf, 1984). In the recent past, an argument of market timing is also gaining ground (Baker and Wurgler, 2002). Market timing proposition perceives that firms’ current capital structure is the reflection of their cumulative ability to issue over priced securities. The available empirical evidence on validating these arguments is mainly confined to developed capital markets. As emerging market firms’ face higher and distinctively complex asymmetric information problems while making financing choices, in the present study we empirically investigate the validity of pecking order theory in the context of Indian firms. India, being a representative of emerging markets shares their characteristics of dominant business group ownership and under developed institutional mechanisms (Khanna and Palepu, 2010).

We consider all the Indian listed firms for empirical analysis. All the required financial information of the sample firms has been sourced from CMIE – Prowess database. We exclude financial firms and firms with negative net worth. We also exclude firms controlled by the state as their capital structure choices most often are not driven by economic considerations. The final sample is of 37,772 firm year observations, consisting of 3,832 firms with an average of 9.84 years each. Of the sample firms, 38.24% are business group affiliated firms and remaining 61.76% are stand-alone firms. The average sample firm uses much higher debt financing (0.42) than a typical firm (0.28) from the US market. According to the pecking order hypothesis, equity issuance has the highest adverse selection premium, and its issuances are very rare. On the contrary, we find that in the case of current sample, the percentage of equity issues of at least 5% of the value of their total assets have always been higher than 4.91%, peaking 35.28% in the year 1995. The per-

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centage of equity issuances are more than 10% in 10 out of 19 years of the study period. The evidence further suggests that the sample firms raised substantial equity finance during the study period in the form of equity. Thus, our preliminary evidence contradicts the pecking order theory, which argues that the debt dominates external financing and equity issuances are very rare (Myers, 1984). We employ the pecking order equation (suggested by ShyamSunder and Myers, 2999) and estimated the annual pecking order coefficients across the study period.

The highest annual pecking order coefficient (0.56) has been significantly lower than one as envisaged by the pecking order theory and is also less than 0.74 as suggested by Chirinko and Singha (2000).

The average pecking order coefficient estimated, using all firm year observations has been 0.38. Such evidence implies that sample firms do not seem to follow pecking order while making financing choices.

The pecking order theory is expected to perform better at least among firms that face higher adverse selection costs. These adverse selection costs tend to vary across firms based on their size and ownership. Large firms given their opacity are expected to face lower adverse selection costs when compared to their smaller counterparts. Hence, we expect higher pecking order co-efficient among the smaller firms. Contrary to our argument, we find significantly lower pecking order co-efficient in the case of small firms (0.26) when compared to their larger counterparts (0.45). We also report the higher pecking order coefficient in the case of business group affiliated firms compared to the stand-alone sample firms. Our findings may not imply the higher information costs among business group affiliated firms.

It could as well be that business group affiliates can issue more amount of debt than their stand-along counterparts because of their sheer reputation or operational diversification. However, the packing

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order argument fares worse where it is expected to perform better (e.g. among small firms). We further investigate the reasons for such an outcome. Conventional wisdom suggests that firms’ actual borrowing depends on the ability and their willingness to borrow. Firms’ borrowing then would be the lower of these two. Pecking order theory focuses on firms’ willingness to borrow, but does not consider firms’ ability to borrow. Once firms exhaust their debt capacity, they will eventually resort to equity. In the presence of debt capacity constraints, the pecking order theory perceives that the relationship between net debt and financing deficit would be concave. We account for the firms’ debt capacity constraints in at least two ways. First, we separately estimate the pecking order equation for the firms that are constrained by lower debt capacity and those that are not. Second, the basic pecking order equation is augmented with the inclusion of a quadratic term, the square of financial deficit as independent variable. As envisaged, the relationship between debt issuances and financial deficit is found to be concave in nature. However, the reported estimates do not satisfactorily support the pecking order hypothesis.

Additionally, we investigate the relative strength of the pecking order argument in the presence of conventional leverage determinants such as firm size, tangibility of assets, growth opportunities, and firm profitability. The introduction of financial deficit (pecking order variable) variable in the conventional leverage regression has not influenced the effect of conventional determinants on leverage among the sample firms. The leverage determinants such as tangibility (market to book ratio) continue to have positive (negative) influence on leverage ratio.

Thus, the overall evidence suggests that sample firms do not follow pecking order while making their financing choices, even after controlling their debt capacity concerns.

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Union Budget 2020-21: Foundation for a consumption led growth The Union Budget 2020-21 has laid the foundation to achieve the level of USD 5 trillion economy by 2024-25 by focussing majorly on increasing consumption, capex and investments, infrastructural development along with various incentives for strengthening health and agriculture sectors of the economy. This will have cascading effects both in short term and long term and will trigger the virtuous cycle of the economy to perform and move forward. With the central tenet of Ease of Living for all citizens, the budget is woven around three prominent themes of Aspirational India, Economic development and Caring Society. These would become the pillars of strong and sustainable growth of the country.

The focus of the budget on the agriculture sector with pinpointed 16 action points to double farmers’ income by 2022 is highly encouraging. The thrust on agriculture will create tremendous demand in the economy, boost manufacturing and services sector activities and rebound the economic growth trajectory of the country. The Agriculture Credit target of Rs 15 lakh crore will significantly increase the accessibility of credit to small and marginal farmers and push rural demand.

The allocation of Rs 1.60 lakh crore for agriculture,

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irrigation & allied activities in the budget will give a mega boost to revive the farm sector. Further, an allocation of Rs 1.23 lakh crore for rural development and panchayati raj will increase the consumption demand in the economy. Schemes such as Dhanlakshmi scheme, Krishi Udaan Scheme will certainly change the sentiments of the agriculture sector towards prosperity. The DhanyaLaxmi Scheme will enhance the participation of women in the agriculture sector. The Krishi Udaan Scheme would help in reducing wastages in the food sector thereby facilitating farmers in enhancing their farm income.

The government has provided significant impetus to industry in the budget with the objective of strengthening entrepreneurship and promote ease of doing business in the country. Allocation of Rs 27300 crore for development and promotion of Industry and Commerce and setting up of an Investment Clearance Cell will provide a significant boost to manufacturing activities in the economy.

The abolition of DDT, a long standing demand of the industry, is highly encouraging as it will further make India an attractive destination for investment.

To further promote domestic manufacturing, custom duty reductions are being proposed on certain raw materials and capital goods. There is a concerted effort to encourage entrepreneurship in the country by increasing the turnover limit for startups to Rs 100 crore from Rs 25 crore with the extension for claim of 100% deduction period from the existing 7 years to 10 years. Further, early life funding is proposed for the start-ups, including a seed fund to support ideation and development of early stage that would strengthen the start-up campaign in the economy.

The budget has provided a bunch of measures to give further impetus to MSMEs. The turnover threshold for audit has been increased from Rs. 1 crore to Rs. 5 crore for businesses carrying out less than 5% business transactions in cash. This will reduce compliance burden on small retailers and traders. Further, the launch of an app-based invoice financing loans product will remove the problem of

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delayed payments and consequential cash-flows mismatches for the MSMEs. The launch of NIRVIK scheme, that provides higher insurance coverage, reduction in premium for small exporters and simplified procedure for claim settlements, will help in achieving higher export credit disbursement in the country.

To provide a massive push and impetus to the infrastructure sector, various initiatives and announcements have been made in the budget. Key reforms to strengthen the infrastructure include allocation of around Rs 2 lakh crore for transport infrastructure, Viability Gap funding window for setting up hospitals in the PPP mode, extension of concessional corporate tax rate of 15% to new domestic companies in power sector, tax incentives for affordable housing projects, among others.

The government’s proposal to invest Rs 103 lakh crore in National Infrastructure Pipeline focuses on a forward looking outlook on infrastructure projects, creating jobs, improving ease of living, and providing equitable access of infrastructure to all, thereby making growth more inclusive. Further, the proposal of Rs 1.7 lakh crore for transport infrastructure in 202021 will help in strengthening connectivity and reduce transaction and logistics costs of businesses.

With the objective to boost growth of India’s financial sector, reform measures such as deepening of the bond market, increase in the Deposit Insurance Coverage for a depositor, reduction in the limit for NonBanking Financial Companies (NBFCs) to be eligible for debt recovery, among others have been announced. Further, the budget has delivered quality and praise worthy taxation reforms. The exemption from income tax for people with income of up to Rs 5 lakhs and rationalization of taxes to 10% for people with income between Rs 5 lakh to Rs 7.5 lakh, 15% income tax rate for income between Rs 7.5-10 lakhs, 20% income tax rate for income between Rs 10 -12.5 lakhs and 25% income tax rate for income between Rs 12.5-15 lakhs are encouraging and are expected to boost the demand in the economy. Corporate tax rate of 15% has been extended to new electricity generation companies. This will attract greater investments in the power sector and give a significant boost to the

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manufacturing activity in the economy. Simplified GST return is to be implemented from 1st April, 2020 as a pilot run with features like SMS based filing for nil return and improved input tax credit flow.

The introduction of Vivad se Vishwas Scheme to reduce litigation in the taxation environment is highly appreciable as it will benefit many taxpayers and can generate more than Rs 2 Lakh crore for the Government in the coming times if it is broadened and exclusions are minimum under this scheme. In the Vivad se Vishwas Scheme, the Government has announced that the amount of disputed tax or 25% of disputed interest or disputed penalty or disputed fee is payable on or before 31st March 2020.

Exemption of 100% tax to the interest, dividend and capital gains income has been given on investment made in infrastructure and priority sectors before 31st March, 2024 with a minimum lock-in period of 3 years by the Sovereign Wealth Funds of Foreign governments. This will incentivise the investment by the Sovereign Wealth Funds of Foreign governments in the priority sectors. In real estate sector, the computation of income in respect of transaction of immovable property where the consideration is less than the circle rate has increased safe harbour from 5% to 10%.

This will boost housing sector in the country. Further, the additional deduction up to Rs. 1.5 lakhs for interest paid on loans taken for an affordable house has been extended till 31st March, 2021. This will boost the supply of affordable houses in the country and help in realisation of the goal of ‘Housing for All’ and affordable housing.

The budget has focused on education, health and sanitation, welfare of women, employment, and skill development. The increase in the allocation on education to 4.7% of GDP is in line with the expectations and will provide the required push for making India the educational capital of the world in order to harness the demographic dividend. Going forward, it is suggested that the share of education should be increased further to 6% of GDP. The launch of New Education Policy in the coming times will improve the outreach of the education to the needy people.

On the health front, an allocation of about Rs 69,000

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crores has been made for the health sector and other supportive measures for bringing Ease of living for every citizen.

Strong focus has been laid on the welfare and upliftment of socio-economic segments of the economy.

This will lead to an increase in domestic demand and enhance the level of economic growth along with all inclusive development. An allocation of Rs 28,600 crore for women specific program will give a significant boost to the capacity building and overall development of women in the country. In addition, the budget has emphasized the Government’s aim to enhance climate change adaptation with a focus on Disaster Resilient Infrastructure.

The fiscal deficit at 3.5% of GDP in FY2021 is in line with the expectations. The government has set an ambitious disinvestment target of Rs 2.1 lakh crore for 2020-21 as compared to Rs 65,000 crore in FY2020, to partially meet its revenue needs. With this ambitious plan for disinvestment, the government is expected to bring the fiscal consolidation programme back on track.

In a nutshell, a series of far-reaching reforms, unveiled in the Union Budget 2020-21, aims at energizing the Indian economy through a combination of short-term, medium-term, and long-term measures.

With this backdrop, the overall budget is growth provoking and welfare inducing to ensure sustainable growth of the country.

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ADITYA GURJAR PGP

IIM A

Corona Virus reaches the Dalal Street.

As the buzz is around, you might already have heard about the Coronavirus. However, for the starters, Coronavirus is a fatal viral outbreak which emerged in the Wuhan Province of China and has been spreading since then with an increasing number of fatalities as the days pass by.

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It has been creating a sense of fear and people in China have stopped visiting bars and restaurants.

But one more place where the repercussions of this virus outbreak can be seen is the stock market.

Global equity markets have been taking a blow because of the news about spreading of the Coronavirus, leaving China and affecting people in Japan, Singapore and SEA countries.

The S&P 500, and Hang Seng have tanked since the last 3 days, and the same effect has rolled over to the Indian stocks. Sensex and Nifty have also tanked amid the news of Coronavirus breakout. All the major indices in the Indian equity markets like Bank Nifty and others have taken a hit. However, the pharma sector stocks which were moving sideways since a long time have rallied in the last week.

It has been creating a sense of fear and people in China have stopped visiting bars and restaurants.

But one more place where the repercussions of this virus outbreak can be seen is the stock market.

Global equity markets have been taking a blow because of the news about spreading of the Coronavirus, leaving China and affecting people in Japan, Singapore and SEA countries.

S&P 500; Source: FT

Hang Seng; Source: FT

NIFTY 50; Source: FT

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S&P 500 vs CBOE VIX; Source: Author's analysis

The CBOE Volatility Index, which is a leading indicator also suggests the same, where it has risen from 13 to 18 in the past few days and as a result, a lot of investors as well as traders saw the value being washed out. More than $1 Billion worth of value has been wiped out from the global equity markets. This is evident from the graph above.

NIFTY Pharma vs NIFTY 50, Bank, Auto; Source: FT

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Why are the pharma stocks rallying?

The pharma stocks are moving against the market and have been rallying. This is not just the case with the Indian Pharma stocks, this trend can be seen across the major markets. Chinese Pharma stocks have gained more than 20% in a day. The sole reason is that the companies which manufacture antidotes to flu related viruses have their products in high demand. Other companies involved in the manufacturing of the test kits as well as protection masks also see surge in the demand of their products.

The virus has crossed the borders and the cases can have been noted in Japan, Singapore and other Southeast Asian countries as well.

As a result of anticipation, the Indian Pharma stocks are also seeing a rise in the prices. Lupin, Sun Pharma, Cipla, Dr. Reddy’s Labs and many more have been a part of this.

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NITISH RAJ IIFT D

INDIA BECOMING A GLOBAL MANUFACTURING CAPITAL India is the third largest economy in Asia and is set to become the fifth largest economy of the world by surpassing UK. India is also expected to improve it’s ranking in the global manufacturing competitiveness. For the last two decades, growing domestic demand and rise in disposable income of the greater segment of middle class has boosted India on a relatively steep growth trajectory as compared to the rest, making India as one of the fastest growing economies of the world. The period also witnessed the birth of Indian companies making rapid footprint on the world stage mostly, from the Information Technology, Automotive, Pharmaceuticals industries. However, it has been witnessed that India is still dependent on imports driven country. Most of the imports for the strategic sector like Defence, Aerospace, Bio-Medical equipment, capital goods are imported from developed countries, which were conventionally a driven by public companies in India. Thus, the economy of India has increased but manufacturing has not grown with the same pace.

The government has set up high targets by the launch of “Make in India” campaign. The government is targeting to make India’s manufacturing gross value add to 1Trillion USD, increase in the share of exports from India to the world and curb the dependability on imports by 10%.The emphasis for growth in domestic manufacturing sector will progressively result in adoption of high technology, increase in the new employment avenues, creation of advanced manufacturing capabilities and promote overall competi-

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tiveness that will result in a major boost to exports and creation of several more India based manufacturing hubs.

Industry 4.0 processes are rapidly deployed across the shop floors in this growing digital manufacturing era. India has an excellent opportunity to leverage its highly educated workforce that can be trained in digital processes and contribute in the smooth execution of the manufacturing hub in the country. The integration of digital and manufacturing sector has grown considerably and it is well witnessed in some industries with the use of predictive analysis, sensor base real time monitoring and machine learning, etc.

There has been a considerable slowdown in the growth of manufacturing in China. The geopolitical reasons have also diverted the interest of the global investors in India. The manufacturing labour cost in India is less as compared to that of China. A high target has been set to increase the contribution of manufacturing sector share to GDP by 25%. The government has started a series of steps to ensure positive changes in the of country’s foreign investment policy that now allows a much higher levels of investment from abroad in diverse sectors. The government has allowed hundred percent FDI in those sectors. This has resulted in India becoming one of the most open economies in the world and has promising position in the minds of investors to attract large-scale foreign investments. For the manufacturing scale in India to increase catering to the domestic market alone will not be enough. To mark the presence in the global markets India will require a strong policy to incentivise exporters. A strong policy meant to promote trade will make India attractive for FDI from global manufacturers and also create employment for the people of India.

India has advantage as it has 3D i.e. democracy, demography and demand. It is expected that the electronics industry has an annual growth demand of 20

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percent and production of around 30 percent. The low cost of manpower but high quality and productivity of the workforce is expected to make India a favourable place to manufacture. Electronics, industrial manufacturing, transport and logistics, chemicals and real estate are five sectors projected to enjoy a high growth rate till 2025. Large multi nationals have expressed confidence in India’s potential to flourish in manufacturing. Multi -national companies like Toyota , Xiaomi, Samsung are setting up manufacturing hubs and factories in India.

The ease of doing business will be one of the most important factors in making India a manufacturing hub. India moved to the 63rd position in the World Bank’s Ease of Doing Business global rankings due to sustained business reforms. But global investors will not be willing to invest by just looking at the overall ranking. The inventors will analyse each parameter and ranking on then will do their own due diligence before investing. The cost of logistics anis also an important concern for foreign investors and for Indian companies. One of the major problems in the manufacturing sector in India is that infrastructure of India is not well developed. As a result, the cost of manufacturing goes up. The infrastructure in the country needs to be developed at a much rapid pace in order to make logistics efficient. Lowering the cost of logistics will make domestic goods competitive in the global markets. Few other problems with the manufacturing unit in India is complex land acquisition. Governments are cautious of providing land or resources at concessional rates as it can be used politically even it is in the interest of the nation. Without government intervention global companies cannot acquire land directly as the law in India mandates companies can build their facilities on land which has been acquired by the government. The market value and the book value differ owing to the black market which leads to exploitation of people during the land acquisition process. Also, in the absence of proper labour laws companies are unable to move their re-

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search departments to India. The other area which needs attention is enforcing contracts. According to the World Bank India ranks 164 amongst 190 countries on enforcing contracts. On an average, Singapore takes less than six months to settle a dispute while in India the dispute is resolved in 4years. For India to win the battle for global manufacturing supremacy these areas need to be looked upon. Then only the manufacturing in India can drive innovation and be cost -competitive to attract global companies.

It will be a double advantage for the global companies if the domestic market swallows a bigger chunk of manufactured goods.

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with as many as 15 countries. Were we right in opt-

NISHANT KUMAR SATYAM IIM INDORE-IPM

ing out of it? Or do we need to re-think our decision?

The RCEP is a maze of F.T.A.s, protection clauses,

OPTING OUT OF RCEP Does India need to rethink its decision?

On 4th November 2019, the Indian Government decided not to be a part of the Regional Comprehensive Economic Partnership deal (RCEP), as it failed to assuage India’s “outstanding issues and concerns.” The mega free trade-pact would have included 16 nations and would have covered 45% of the world’s population and nearly 40% of global

and tariff eliminations. A proper evaluation of its merits and demerits is needed, both from an economic, and a political perspective, if any re-thinking of the decision is on the horizon.

The good things first, true the RCEP would have created the world’s largest free-trade zone, with India being an integral member of this partnership, having tariff-free access to nearly half the world’s population. India’s struggling export sector was ex-

pected to receive a much-needed boost in terms of volume of trade, both in goods and services.

G.D.P. It promised the creation of the world’s larg-

It would complement the existing F.T.A.s with

est free trade area and was poised to be the biggest

countries such as Japan and Korea, along with cre-

trade-agreement, post the creation of the World

ating new F.T.A.s with other non-ASEAN partners,

Trade Organization (W.T.O.). Yet, India chooses to

such as China and Australia. This would have off-

walk away from seven-year-old negotiations and the

set any potential negative impacts that the Transpa-

prospect of a unified free trade agreement (F.T.A.)

cific Partnership (T.P.P.) or the Tran- Atlantic

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Trade and Investment Partnership (TTIP) would

litical clout, even in the presence of unified

have had on the Indian economy.

ASEAN pressure. Domestically, with the economic

RCEP could have made India a part of the regional

slowdown already being termed as “India’s Great

“production” networks, which rely on substantial

Slowdown,” and comparisons being made to pre-

manufacturing capabilities to make Asia the world’s

1991 situations, opting out of RCEP seems like a

factory. With our manufacturing sector contracting

decision motivated by domestic political pressure

by -1% in the recent quarter, one may feel that we

and blind nationalistic pride, rather than based on

have missed a golden opportunity. Internal reforms

sound economic rationale. But is that all? Are we

such as “Make In India” can have only limited

penny-wise and pound-foolish?

impact, until we provide clarity on “Make in India,

A closer look at the factors that were behind the

but for whom?”. Being part of such global networks brings not only access to markets, but also technology, investment, and skilled human resource. The RCEP would be a stepping stone to India’s “Act East Policy,” as a natural extension to the economic, cultural and strategic ties the Government has been forging.

Such integrated markets provide another massive opportunity for India’s famed ser-

Modi Government’s refusal to join RCEP, uncover

vices sector. With manufacturing activities becom-

the superficiality and trickery of the international

ing increasingly complex and layered in these Asian

political economy. A clear unfavorable trade-off

countries, “servicification” of manufacturing has

between market access and export-growth is visi-

occurred. This could very well be the opportunity

ble.

for the Indian services sector to look for its next

To begin with, despite import-tariff-s reducing, and

round of growth.

Indian goods becoming cheaper in foreign markets,

Apart from mere economic benefits, this move has

previous research has shown that the demand for

significant political complications, as well. One

Indian products is more sensitive to the income-

might have felt that by opting out of the RCEP,

levels of consumer-countries, rather than the prices

India has managed to exercise its international po-

of the products themselves. Blame this on our in-

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verted duty structure, which makes our exports un-

that

competitive, but the fact remains - India would

has 15 bilateral,

have gained very little in terms of export-growth

with NITI Aayog reports showing an increase in

by joining the RCEP. Trade barriers would have

bilateral trade in everyone, but with imports in-

been lowered only with three countries - China,

creasing much more than exports.

Australia, and New- Zealand. The opening up of

India’s trade deficit with China is already at

our country for China, under RCEP, does not necessarily translate into China opening up their econo-

preaches

F.T.A.s. regional

India trade

currently agreements,

an unsustainable level and is expected to be exacerbated under RCEP. Even with other RCEP

my for Indian Cos. China has long been infamous

countries, we run huge trade deficits. Allowing

for covert protectionist policies, all the while driving

their manufactured goods into our markets,

a hard bargain over F.T.A.s with other countries.

with no

Agreeing to the current terms of RCEP would have

ports (services,

allowed the possibility of product-dumping by Chi-

etc.) would benefit from RCEP, is bound to ag-

nese subsidized companies and state-owned enter-

gravate our trade deficit even further.

prises (S.O.E.s). Cases of dumping have increased

Under such macro-economic situations, opening

recently with most being from our Asian neighbors,

up our economy to a country which does not open

with, of course, China taking the lead.

up to us and is known for product-dumping global-

The Chinese economic system has long discouraged

ly, can potentially destroy our already fledgling

Indian

manufacturing sector and export-units.

imports,

nowned services,

with

our

globally

pharmaceuticals,

reand

even Bollywood films, severely disadvantaged in the Chinese economy. Concerns over quality, based on which Indian exports are discouraged, are frequently raised by the Chinese authorities. But the fact remains that our goods (e.g., pharmaceuticals) find high acceptance worldwide, by meeting strin-

clarity on

how

our prime

pharmaceuticals,

ex-

B.P.O.,

Any talk of benefits due to integration into the regional production networks gets neutralized simply because we lack the infrastructure as well as the policies to take advantage of such synergies. Our industries lack efficient technologies, while inflexible labour laws disincentivize firms to grow beyond a limited size and thus complete globally.

gent quality standards (e.g., USFDA approval).

By opting out of the agreement, we have sent out a Our export promotion structure being lackluster, and our inability to compete with Chinese state-subsidization and manufacturing clout raises serious concerns over any agreement

strong message which will resonate in the interna-

tional political corridors for a long time to come.

The

Government

the temptation of

has

effectively

trading valuable

resisted access,

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for empty global praise. It has continued its image of a strong emerging superpower, by acting inde-

it. Despite all the hue and cry about non-

pendently in the face of international pressure,

agreement to RCEP being a protectionist move,

and in a very un-Trump-like way, put its interests

one cannot be blind to the harm caused to domes-

first.

tic units, by agreeing to a half-baked proposi-

By opting out, we have ensured that our industries

tion, that gains us little, but costs us a lot.

will continue to run, although serious policy changes

The definitions of globalization are changing as

are needed for them to survive.

quickly as globalization itself, and a country like

Ranging but not limited to, second-generation re-

India does not harm anyone by protecting its in-

forms in the factor markets, labor-laws, financial

terests,

liquidity, land acquisition, core-infrastructure such

and comprehensive concerns.

as logistics, electricity as well as sustainability concerns, need to be introduced if we aim to see Indian exports compete at a global level. Such internal reforms have become all the more necessary, not just because we are facing the worst slowdown in years, or we turned down RCEP, but in an overly protective world, where trade and commerce have be-

based

on tangible,

valid,

Therefore, it is not India who needs to re-think its decision of opting out of the RCEP, but the other RCEP members, who need to reflect on how they have failed to address the genuine concerns of the largest democracy and the largest emerging market.

come restrictive as well as expensive, “Survival of

India, on the other hand, must focus on

the Fittest� is the only truth.

its internal macros and become globally competi-

The decision to opt-out of the RCEP brings in more benefits for the Indian economy than it harms

tive as soon as possible, if it wishes to achieve the fabled goal of a $5 trillion economy by 2025.

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PARUL MEHTA MDI GURGAON

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of any country. They are also the major contributor to the GDP growth and reason for the foreign currency flow in any country. As per the report of Morgan Stanley Capital International (MSCI) 2019, India is

The role of the Foreign TPO (Trade Promotion Agency) and its Future Prospects in India With a special view on Exports & Imports

considered as one of the fastest growing economies

and one of the potential emerging markets in the Asian territory.

Reference to the Graph 1, the total GDP of the world is continuously growing even after the major recessions like in 1929 & 2009. The total GDP of the world economy is USD 80.935 Trillion in 2017. Reference to the Graph 2, The total GDP of India is rapidly growing which also supported by the different factors like ease of doing business, the presence of natural resources, manpower, capital & land. The total

Export & Import are the two major activities that contribute to the growth of the economy

GDP of India economy is USD 2.65 Trillion in 2017.

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(Reference: Graph 1: GDP of the World,World Bank Data, https://data.worldbank.org) The major role of the Trade Promotion Agencies is to

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(Reference: Graph 2: GDP of the India,World Bank Data, https://data.worldbank.org) •

Collectivist society, long term-orientation and

facilitate the Network by World Conference and

good at work-orientations as per the Hofstede’s

Awards, exchange of experiences, culture & infor-

cultural analysis.

mation, adoption of good practices, platform for col-

•

Long Coastal line of India

laboration and mutual improvement through online

•

Well developed Special economic zones

and offline forums. The Trade Promotion agencies

•

Heavy investment in the development of the

have a pivotal role as intermediate in the flow for the international trades from one country to another.

road and rail infrastructure •

ICDs

Factors & Strategies promoting •

International Trade from India

South Asian and African countries.

•

to the constant increase in the export & import in India: •

Good relationship with other unions and trea-

ties like the USA, European Union, ASEAN,

In comparison to the other economies, there are many factors& Strategies that are contributing

Good connectivity in seaports, airports, &

Tax relaxations to promote the import & export of different commodities

•

Ease of doing business index (Rank:100)

The mix presence goods and service industries

•

Present infrastructure in metro cities.

in the Indian economy

•

Presence of the stable airline, logistics, cargo,

•

Understanding towards different cultures

•

Growing in number of institutions, education

•

India currency & US Dollar value.

and literacy rate gave the confidence to the

•

Growing economic indicators like GDP &

Global companies to set-up their Office in India

and Shipping companies.

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GDP Purchasing Power Parity (PPP).

creased growing at an average annual rate of

•

Steady growth in the inflation rate

14.63 % in 2017. (Table:2)

•

Free trade and Bi-lateral agreement with differ- •

In 2017, service imports for India was 109,371

ent countries.

million US dollars. Service imports of India in-

The stable Indian Government and their up-

creased growing at an average annual rate of

coming policies to improve the import & ex-

12.39 % in 2017. (Table:2)

•

Future of TPO’s

port compliances.

•

Implementation of projects like Sagarmala Pro-

The Trade promotion organizations remain essential

ject and improvement of the brownfield air-

part of the country economy which is to drives the

ports, presence of metro connectivity in the cities Export Analysis •

In 2017, exports for India was 489,400 million US dollars. Exports of India increased at an average annual rate of 14.26 % in 2017. (Table:1)

•

In 2017, exports of goods for India was 304,106 million US dollars. Exports of goods in India increased at an average annual rate of 13.32 % in

2017. (Table:2) In 2017, exports of services for India was185,294 million US dollars. (Table:2)

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US

Import Analysis •

In 2017, imports for India was 561,612 million US dollars. Imports of India increased growing at an average annual rate of 13.81 % in 2017.

(Table:1)

•

In 2017, goods imports for India was 452,241 million US dollars. Goods imports of India in-

International trade and maintaining relationships.

Even, their contribution is recognized by the World Trade Promotion Organization.

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The winners of the World Trade Promotion Organization Awards for 2008 are:

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Competitive Advantages in India •

Afghanistan: Best Trade Promotion Organization

Organizational and network the capability of International firms are significantly associated

from a Least Developed Country

with strategy and performance. Indian Compa-

Jamaica: Best Trade Promotion Organization from a

nies are also emphasizing upon building perfor-

Small Country

mance & strategy.

Kenya: Best Trade Promotion Organization from a

•

Developing Country

Implementation of Inventory Management software’s

New Zealand: Best Trade Promotion Organization

•

from a Developed Country

Continuous improvement through imparting training to their employees

•

Incentive system to the employees & buyers/ traders/importers •

Positive control of the distribution

channel •

Customization

•

The stable Geopolitical relationships

with most of the growing global economics •

Presence of Government instructions

like APEDA Exports Councils

EXIM Bank Presence of the trade promotion organizations/Agencies Recommended Strategies I

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US

•

For Incremental Sales: Bundling products

•

Discounts on bulk buying

•

Achieving economies of scale

•

Participating in the International events & exhi-

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bitions.

•

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Maintaining relationships with customers for

Exports of Goods & Services Date Value in USD

repeat orders

2017

4,89,40,09,13,160

Upgrading the certification levels as per the In-

2016

4,30,43,34,87,928

ternational markets

2015

4,28,63,09,03,176

Entering into the untapped markets through

2014

4,85,58,30,46,458

collaborations, partnerships, joint ventures.

2013

4,68,27,34,26,431

•

Sales promotion activities

2012

4,43,84,51,80,758

•

cost-leadership strategy i.e. offering better price

2011

4,46,37,54,04,071

to the buyers

2010

3,48,03,53,71,769

2009

2,60,84,71,57,422

2008

3,05,11,93,36,663

2007

2,40,08,20,39,834

2006

1,93,31,60,62,904

•

•

B. Building the Customer Loyalty: •

Brand awareness campaigns.

•

Value addition for the target audience which

may define benefits.

•

Urge for extensive brand building activities for sustainable growth.

•

Promotion through paid digital marketing tools to increase the impressions and visibility of the company.

Total Exports of Goods & Services

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Date 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006

Exports of Goods Value in USD 3,04,10,68,98,883 2,68,61,47,05,000 2,72,35,27,29,600 3,28,38,69,08,294 3,19,10,97,94,565 2,98,32,05,84,200 3,07,84,74,88,406 2,30,96,70,60,095 1,67,95,76,71,240 1,99,06,50,97,558 1,53,52,95,80,290 1,23,87,62,14,466 E

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Exports of Services Value in USD 1,85,29,40,14,277 1,61,81,87,82,928 1,56,27,81,73,576 1,57,19,61,38,164 1,49,16,36,31,866 1,45,52,45,96,558 1,38,52,79,15,665 1,17,06,83,11,674 92,88,94,86,182 1,06,05,42,39,105 86,55,24,59,544 69,43,98,48,438 S

Imports of Goods & Services Date Value in USD 2017 5,61,61,25,25,786 2016 4,72,01,26,94,193 2015 4,91,88,00,74,571 2014 5,53,55,28,54,081 2013 5,60,40,84,78,124 2012 5,79,90,85,79,784 2011 5,53,06,21,86,680 2010 4,39,05,90,34,248 2009 3,28,25,71,76,213 2008 3,79,47,93,80,179 2007 2,78,78,57,52,272 2006 2,25,08,60,27,162 T

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2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007

Imports of Goods Value in USD 4,52,24,13,83,880 3,76,09,02,54,276 4,09,23,69,78,523 4,72,43,42,64,991 4,81,68,62,57,768 4,99,98,89,61,275 4,75,30,40,47,600 3,60,14,60,62,834 2,75,22,70,34,893 3,23,91,65,18,439 2,08,61,08,99,982

Imports of Services Value in USD 1,09,37,11,41,905 95,92,24,39,917 82,64,30,96,048 81,11,85,89,091 78,72,22,20,355 79,91,96,18,509 77,75,81,39,080 78,91,29,71,414 53,03,01,41,320 55,56,28,61,740 70,17,48,52,290

2006

1,66,57,18,62,854

58,51,41,64,307

Date

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RISHABH PURI PGP

IIM A CFA

INSIGHTS FROM ACHIEVERS H

CFA What motivated you to pursue CFA coming from an engineering background?

I was inclined towards finance domain before joining MBA program. Once I joined IIM Amritsar, I wanted to explore my options to enhance my profile by gaining deeper knowledge about my preferred domain.

After thorough research and discussion with my seniors, I decided to enrol for CFA program as it has a wide syllabus and will the knowledge gained will be useful in a number of jobs in the sector. Being an engineer, I did not find myself at any disadvantage w.r.t. studying a completely new domain without prerequisite knowledge. Most of the basic concepts get covered in term I of our MBA program.

When did you start preparing for it and what was your preparation strategy?

I started preparing for it from the first week of October 2018. Everyone I consulted to had a different preparation strategy and eventually one has to decide

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this for themselves. At the onset, have a clear idea that which subject is lengthy and tough to grasp; accordingly, I made a plan to cover the topics in a predecided sequence. This helped in maintaining interest on a continued basis and complemented the topics being covered in our MBA curriculum.

Was It difficult for you to manage you CFA preparation along with the MBA Classes?

It can be challenging to manage preparations and MBA classes at times, especially during the mid and end term week. Hence it is necessary to stay on planned schedule throughout so that it doesn’t get taxing to cover the curriculum later. Term 1 and 2 of MBA have a number of subjects with classes running till late evening. As a result, it is better to fix time for various activities throughout the day. Being in regular touch with the curriculum will go a long way in reducing preparation related stress and will provide great rewards via timely completion of syllabus and ample revision. Since we cover most of the curriculum when in college, it is of utmost importance to manage time between CFA preparation and MBA Classes.

What advice would you give to those who will be giving there CFA level 1 upcoming June?

For level 1, try putting in some hours on a daily basis.

Do not wait for internship period to start as the curriculum is huge and difficult to cover under pressure.

Make a plan early on and stick to it. At the same time give ample days to revision and practice questions.

Question bank provided on website is a must as majority of exam questions are on the same lines as those Question bank one’s. Finally, try to give some mocks as real exam is lengthy and it gets taxing in the second half; get used to similar environment beforehand.

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Which topics according to you are most important and should be given special attention?

Topics like FRA and FIS perhaps the most difficult in the whole curriculum and need to be given extra attention. They need to be covered early on and revised multiple times for deeper understanding. Fra has 12 reading and they need to be broken down according to time available (I made a weekly target of content to be covered). Questions at the end of CFA material readings are equivalent to the actual exam and are a must for gaining confidence.

Then there is Ethics, which is known to be tricky and needs lot of practice (especially from CFA material questions). Ethics is said to be a make or break subject in level 1 exam as low marks in this section heavily reduce passing chances due to its high weightage.

QM, Equity, Derivatives and are not covered in depth in level 1 and can be managed later on as well.

At the same time, majority of Economics, Corporate Finance and Portfolio Management is in line with Financial Management covered in our MBA program.

Alternate Investment, having only 1 reading can be tricky during exam as no. of questions are less in this section and one needs to be absolutely thorough in that reading.

What were your last minute preparations?

I completed the curriculum by 15th April. After that I revised the complete syllabus in the next 10 days. This is the most important revision cycle as half of what we’ve studied gets forgotten and it takes time to recall all the concepts. I used Schweser notes for revision at this time.

After this I started solving the question bank provided online on CFA website (try going subject wise).

This continued till 20th May. Then I took 4 full length

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mocks in a test environment till 5th June. Analysis of these mocks is extremely important for seeing where one goes wrong.

Then came the last round of revision till 13th June during which I gave no mocks and focussed only on revising each topic via Schweser notes. At this time, make sure to see each and every line of your notes; prepare a schedule accordingly via rationing time available.

What advice would you give to those who will be giving there CFA level 1 upcoming June?

For level 1, try putting in some hours on a daily basis.

Do not wait for internship period to start as the curriculum is huge and difficult to cover under pressure.

Make a plan early on and stick to it. At the same time give ample days to revision and practice questions.

Question bank provided on website is a must as majority of exam questions are on the same lines as those Question bank one’s. Finally, try to give some mocks as real exam is lengthy and it gets taxing in the second half; get used to similar environment beforehand.

Finance and Economics Club of IIM Amritsar wishes Rishabh Puri all the very best for his future endeavors.

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SHUBHAM KHANDELWAL PGP FRM

IIM A CFA

INSIGHTS FROM ACHIEVERS H

FRM Tell us something about your background?

I did my engineering in Electrical Engineering and have worked across financial and technology sector before joining IIM Amritsar. The past two years have been a roller coaster ride where I polished my skills in various domain but I chose to pursue and build my career in the field of finance.

How did you develop your interest in finance?

I was always intrigued by the stock markets and my father always encouraged me to take risks and I have to give credit to my father for helping me to shape my interest towards the finance domain. I have been investing in the stock market since 2011. Also, my prior work experience in the field of providing investment solutions to clients further intrigued my motivation to study finance. I have also cleared CFA Level 1 which further helped me to better understand the various aspects of the financial market.

What exactly lead you to take this exam?

I believe there are two very important aspects in reference to finance: Investment and Risk. But usually a

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lot of emphasis is paid on which stocks to invest, which model should we employ while doing the valuation of the company. But the various risk factors around the company, around the industry are not paid much attention. It becomes really important to also understand the market and the credit risk involved.

So to have much better perspective and have a big picture and to complement my knowledge of investing FRM exam was a perfect opportunity for me to expand my learning horizon.

Can you tell us about the curriculum and your strategy for the various challenges this exam brings?

My expectation after clearing the CFA Level 1 exam were completely blown out of proportion because FRM is a different ball game altogether. It is more specialized and dense than CFA. It focused on managing exposure to operational, credit, market, foreign exchange, volatility, liquidity, inflation, business, legal, reputational, and sector risk whereas CFA requires knowledge and expertise in a much broader range of financial analysis topics, such as portfolio management, economics, reporting, quantitative analysis, and more.

I followed the GARP and Schweser Books for my preparation.

The exam is a bit tough as compared to CFA as it is more specialized and involves the following topics: •

Financial markets and products

•

Valuation and risk models

•

Market risk measurement and management

• • •

Credit risk measurement and management Operational risk and resiliency Liquidity and treasury risk measurement and management Risk management and investment management

•

The curriculum is designed in such a way that it re-

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the exam. Stay Cool and give your best.

So any serious aspirant going for FRM should only go for the exam if he is willing to work extra hard.

What are the different fields in which a person can get into after writing the exam?

The exam opens a plethora of options. So, if you’re interested in specializing in analyzing risk as a credit risk manager, market risk manager, regulatory risk manager, or operational risk manager, then the FRM examination will definitely give you an edge.

So the final question if you could any tips to Finance Enthusiasts who are planning to write FRM exam in future?

I believe that this exam is not tough but just you need to invest time because this exam requires discipline and you need to stick to your timetable. I believe that this exam will only supplement your knowledge about the financial markets and the various risks inherent with it. I wish all the best to all the aspirants writing

Finance and Economics Club of IIM Amritsar wishes Shubham Khandelwal all the very best for his future endeavors.

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PUNEET GUPTA PGP

IIM A FRM

INSIGHTS FROM ACHIEVERS H

FRM Can you please tell our readers what is FRM all about and why a finance enthusiast should appear for FRM? FRM is an excellent course to pursue for risk enthusiasts, as it gives you complete understanding of all the major financial risks involved in a project.

Risk management is a pre requisite in almost every organization today.

FRM certification opens many doors in wide-ranging jobs in finance, especially in the fields of credit risk, market risk and regulatory risk.

What are the factors that differentiate FRM from CFA? The CFA curriculum focuses on broad aspects and topics in finance, FRMs on the other hand, are specialists. Their role is more focused and specialized than CFAs. They focus on minimizing risk by analyzing and managing risk.

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As per your opinion, who do you think is best suited and should definitely go for FRM? Any finance professional who wishes to pursue a career in risk management should opt for FRM as it is not a certification of choice. But within risk management, FRM is by far the most popular and widely accepted.

What are the challenges you faced when preparing for FRM and how did you overcome those?

FRM does have complex concepts along with arithmetic applications but I kept it simple and revised the syllabus thoroughly, which helped me ace the course.

Can you please enlighten us on the study material you referred to and study schedule you There are a lot many study material available both in soft and hard copy, but i would suggest you to use Schweser material and stick to it, rather than going through various other books.As i said before,thorough revision and practise papers can be managed with the MBA and will be enough to clear the paper.

Finance and Economics Club of IIM Amritsar wishes Puneet Gupta all the very best for his future endeavors.

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INTERNSHIP EXPERIENCES AVESH SINGH E Y It had always been one of my aspirations to work with one of the prominent consulting firms. Nothing compares to working with big 4. I interned under the Transaction Advisory division of EY. The exposure, work environment and hands on experience on real time projects which one gets in EY is unmatchable.

You garner the same level of respect and freedom as an intern which every other employee in that organisation does. Specific Dos and Don'ts for EY interns Dos: 1. Gel with every other members in your team. They may come handy in your project work.

2. Follow a set pattern of work ethics within the organisation. EY likes to keep it that way.

3. Punctuality is the key.

Don'ts: 1. Uniqueness in the project is appreciated. Avoid imitating other's work.

2. Avoid missing the project deadlines.

Advice: EY as an organisation keeps its employees as a family unit, feel free and enjoy the best of your time at EY.

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I started my internship with Crisil Limited right after the completion of our third term and got the opportunity to work at the headquarters in Mumbai.

The 2-month long journey started with the induction session where we were introduced to the various domains in which Crisil provides there service, by their respective Directors. The next step was meeting our assigned mentors who were mostly Associate Directors and hence had enough exposure and experience to guide us through.

The project that I had to work upon was studying the nuances of 2 different industries before coming up with some analysis and forecasting the performance of the respective industries. Secondary Steel and Automobile Dealership were the two industries that was assigned to me. The aspects which I covered in my industry analysis included mainly the demand & supply scenario of the industry, impact of the raw material's price fluctuation and analysis of the industry's financial performances. Thankfully not only my mentor but also the other members who were working under my mentor were very approachable and helped me with some key insights on my project.

The last week of the internship was all about presenting your work to the Directors.

The journey as a whole was an extremely enriching one for me as the project that I was assigned helped me learn some important concepts with a hands-on experience, which has helped me in the second year o f m y s t u d i e s t o o .

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SHOBHIT RAJ SINGH DEORI ICICI L

We are living in VUCAD world. The way in which businesses work is being tremendously affected by technology everyday. These are the times when an MBA's worth is not realized merely by the qualification badge but one has to prove his mettle in the industry to do so. Summer internship provides you a window to this VUCAD business world. I interned with ICICI Lombard in underwriting role which meant I had to assess risk related to an insurance product, which in my case was Crop insurance under PMFBY. The role required understanding the product and tailoring the price of the product after assessing associated risks. I was successfully able to complete my project due to two main reasons: one that my mentor was really co-operative, second that I was internally motivated to do the work which made me self -reliant for all the resources required to complete the job. In the workplace, interns are generally not given much importance and they really have to fight for resources. The only way to surpass this barrier is to push your limits so that you complete the project within the given framework of the company. The most important learning I imbibed is that the passion to continuously improve yourself on all fronts and always being internally motivated towards your work is the key to survive today's VUCAD world which allows no space for complaints, second chances or laid back attitude.

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Summer Internships are a crucial part of MBA curriculum, and for some, their first foray into the corporate world. For my summer internship, I got an opportunity to work for the Reserve Bank of India at their Jaipur office. RBI is the apex monetary policy formation body of the country, and as such is very highly regarded institution. I was assigned Monetary Research Unit (MRU) which consisted of Department of Policy and Economic Research (DEPR), under Mr. Kunal Rahar and Department of Statistics and Information Management (DSIM), under Mr. Kamal Gupta.

The topic of my summer internship report was “Classification of Central Banks by Autonomy and Its Effect on Several Economic Parameters�. Being mainly a research focussed internship, you are given complete freedom to choose your topic of study and your approach. The initial part of the internship was earmarked for this specific purpose. I was asked to go through several research papers published by RBI, Mint Street Memos and RBI Governor speeches, in order to get a better understanding of the operations and mandates of the bank. Several databases (like CEIC, etc) and sources of information were at my disposal to help with the project.

The most humbling part of the internship was attending the live streaming of the Monetary Policy meet with the Director of RBI, Jaipur and other officials with the governor of the RBI on the other side, and having a discussion on it afterwards. RBI also conducts several staff events, like monthly quizzes on current topics in the world of economics, history of the bank, etc, which I was able to participate in. Interning at RBI was a unique experience that I would cherish throughout my life.

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GOLDEN INVESTMENT FUND FEC’s latest addition to its array of offerings, is a student managed investment fund comprising of experts in the field of F&O and intraday trading. GIF team releases weekly company reports and monthly fact sheet of its portfolio under management.

GIF ANALYSTS

ADITYA GURJAR

LAKSHYA GARG

SHAUNAK TALATI

SANDEEP KUMAR

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CLUB ACTIVITIES FEC is one of the most aspiring student interest groups of IIM Amritsar. Since its inception in 2017, the club has come a long way in serving its purpose, which is to facilitate the outsideclassroom learning amongst the students using the best practices. Beginning with the Induction program for IIM Amritsar candidate selects, all the way to the Final placement process, FEC has borne the responsibility to support the students and assumed a vital role to play through-out this journey.

FEC conducts various activities and events throughout the year and they are as followsGuest Talks: FEC is regularly organising industry guest lectures and workshops to give students more practical exposure. In the past, FEC has hosted CFOs and senior management from the companies like Wellington Management Singapore, CLSA Hong Kong, Wells Fargo, Deutsche Bank, Bank of America Merrill Lynch et.al.

Golden Investment Fund (GIF): FEC’s latest addition to its array of offerings, is a student managed investment fund comprising of experts in the field of F&O and intraday trading. GIF team releases weekly company reports and monthly fact sheet of its portfolio under management.

Starry Nights: FEC is known for its trademark "Starry Nights" sessions where members share their knowledge and experience in an informal setting. Our weekly Fin-League quizzes also put their business acumen to the test and helps keep their minds sharp and ready while fostering a competitive environment.

Pariprekshya: From 2017, FEC, in collaboration with the Industry Interaction Cell, has been successfully organising IIM Amritsar's maiden Finance and Marketing Conclave where eminent industry experts share their view and experience.

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Vitta-Artha: our half yearly magazine provides insightful and informative articles and opinion pieces which facilitate an exchange of ideas. We also organise various national-level competitions in the field of equity research and stock market trading etc.

AArunya: FEC organises two events as a part of AArunya, the annual college fest. Insight Out, a valuation competition and Pit Trading, a case based trading competition.

Our club mentors its members through their journey at IIM Amritsar by helping them harness their potential and enthusiasm and guiding them at every turn. From providing advice about additional certifications and online courses to helping them with subject choices and ultimately polishing their skills which lead to brighter career opportunities.

BIZWIZ-The business quiz: BizWiz is a general business quiz in which teams will have to compete against each other in a series of rounds to come out on top.

Budget Ki Baat: Students of IIM Amritsar came together to discuss about the Union Budget revealed on 2nd Feb, 2020. Different students came prepared with different sectors and shared what they had analysed from the budget.

Quest for Finals: FEC started a series of interview sharing experiences of seniors placed in top firms. Seniors shared their experiences, tough spots and live mock interview to highlight strengths and weaknesses and on the feet thinking.

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GUEST TALKS

AARUNYA

STARRY NIGHTS

PGP

INDUCTION

GUEST TALKS

PARIPREKSHYA

BIZWIZ

FINLEAGUE

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ACHIEVER’S CORNER Finance and Economics Club, on behalf IIM Amritsar will like to congratulate the Achievers of MBA 2018-2020 batch for their efforts and achievements in gaining deeper insights into the world of finance.

SHUBHAM KHANDELWAL

RISHABH PURI

AYUSH DABAS

CFA Level 1, FRM Level 1

CFA Level 1

CFA Level 1

KESHAV GUPTA

PUNEET GUPTA

AKSHANSH SINGHVI

FRM Level 1

FRM Level 1

CFA Level 1

DIVYANSHU BHASKAR CFA Level 1

VAIBHAV SACHDEVA CFA Level 1

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SENIOR COORDINATORS

AYUSH DABAS

MALADI MADAN

RISHABH PURI

SNEHITH REDDY

JUNIOR COORDINATORS

ADITYA ARORA

SAMBHAV JAIN

RISHABH JAIN

CONTRIBUTORS

AKSHAT JAIN

ANIKET KULKARNI

KUSHAGRA KUKREJA

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