Danger of ruin

This refers to ‘Forex debt deserves more attention’ by TB Kapali (April 17). With the global economic scenario becoming uncertain due to policy changes in US Fed rates, impact of Brexit, movement of crude oil and commodity prices, etc, it is imperative that corporates with huge forex exposure go for hedging, else their financial metrics will be ruined and they will be exposed to huge risks.

According to a recent study, it was found that about 80 per cent of borrowers had not availed themselves of forex cover on their foreign loans. This exposes them to risk. RBI guidelines mandate authorised dealers to comply with norms to ensure that corporates do not misuse derivative products for speculative purposes. This issue needs to be approached to promote orderly development of fiscal discipline to insulate corporates and banks them from risks arising out of currency fluctuation.

Srinivasan Velamur

Chennai

Bravo EC

The role being played by the Election Commission in a country which is communally sensitive, troubled by multiple caste equations, and the intrusion of criminals in politics is commendable (‘Lone crusader’, April 17). However it is doubtful whether the EC is bestowed with enough powers to ensure a free and fair poll. It has no option but to requisition the services of the local State machinery for this. Local functionaries may be scared of taking action against politicians for fear of reprisal.

No one knows the outcome of cases filed by the EC during elections. Nor can the EC unearth the sources of political funds; more than 80 per cent comes from unknown sources. In that sense, the EC’s powers are stifled. The fact that ₹89 crore was meant to be distributed to bribe voters at RK Nagar indicates that demonetisation did not achieve its prime objective of rooting out black money.

V Subramanian

Chennai

Valid questions

EA Ramaswamy rightly questions the media in ‘Narayana Murthy raises valid questions’ (April 17). Having pruned the budget estimates all through 2016-17, the present top management has no business to raise compensation disproportionately and as an afterthought claim that they are setting benchmark compensation to the head first and employees later. When performance is not improving and the environment is not conducive for growth, where is the need for compensation hike?

The top-down approach of benchmarking cannot and should not be practised. The reasons put forth by the present management does not hold water. As a founder and shareholder, Narayana Murthy’s authority to question the ruling management can never be doubted, questioned or sidelined. The media should refrain from projecting this as a confrontation.

RS Raghavan

Bengaluru

We want answers

There is no justification for the Government keeping salary under different heads for tax assessment. All allowances and parts of cost to the company can be under one head as salary. In fact, the PF and ESI authorities like to club everything as employers circumvent reasons to avoid or reduce the outgo through structured remuneration.

The Government has been collecting huge education cess for years. What has it done to ensure affordable education? What kind of infrastructure have our governments provided despite collecting toll fees in addition to the regular taxes, cess and additional cess on petrol/diesel? What a person can do with ₹2,50,000/ being the threshold limit for tax purposes? Even in slums, monthly rent is about ₹4000/5000 in a conservative city like Chennai. A family has to spend at least ₹750 on drinking water.

The Government can get away from needless monitoring and concentrate on tax collection with s very simple tax on salary from a marginally higher level, say ₹6 lakh, after clubbing the salary from basic pay to special allowances to HRA, CCA, etc. It should scrap all allowances and deductions/exemptions. An individual’s economic affairs should be left to the individual.

S Subramanian

Chennai

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