Issues in the pension system
This refers to the report ‘The rise and rise of pension plans’ (December 19). While the message in the report is comforting, one is not sure whether the basic issue of social security pension plans are supposed to address is getting the attention it deserves.
In the absence of an income and living wage policy at the ground level, investing in pension schemes is a luxury available for a small percentage of the workforce who are able to receive regular employment with fair wages.
The abrupt withdrawal of the existing pension scheme for government employees from 2004 and unhappy interference in the implementation of existing pension schemes by statutory bodies and public sector units have made the entire social security system for wage earners vulnerable.
Obviously, the Central Government has reasons for their action which are based on rising budgetary demands. Transfer of government expenditure to non-Budget sources should be welcomed. However, ignoring the refusal by employers both in public and private sectors to include retirement benefits as an essential ingredient in the wage bill will be detrimental to the health of Indian economy in the long run.
A related issue is the need to insulate the real value of investments in retirement funds. Retirement funds globally are exploited by considering them as a catchment area for cheap long-term funding of infrastructure and government expenditure.
As India has introduced the National Pension System with the ambitious hope of bringing even workers in the unorganised sector under the social security umbrella, the safety and growth of pension plans become more relevant.
MG Warrier
Thiruvananthapuram
Backing cryptocurrency
The government is formulating many policies and programmes on the basis of flawed advice. The advice of the RBI on cryptocurrency is the latest one. No to cryptocurrency means no to reform. Technology can transform the nation and bring prosperity to its people. China could take millions of people out of poverty in the last decade only through innovations. They have become number one in almost all fields and are now a formidable challenge, in all respects, to the US .
China’s next aim is to find a reliable alternative to the US dollar in international commerce. China knows very well that this currency transition will further reduce US dominance globally.
They are investing heavily in mining and developing cryptocurrencies. India, on the other hand, is turning its back on currency reforms and innovations. If China emerges victorious in creating a widely accepted cryptocurrency, they will rule the global financial system. And India will only be a beneficiary.
Girish R Edathitta
Valuation of IPOs
Apropos ‘IPOs: extending lock-in for anchors doesn’t ensure stability’ (December 18), the proposal by the regulator to link the enhancement in the reservation in the issue and lock-in period norms for anchors may not ensure the desired price sustainability of stocks post the listing.
In a subdued market, if the stocks plummet to abysmally low levels, even institutional investors would have to taste bearish trends and struggle to offload huge volumes due to poor trading.
Instead of containing the issue from the murky investor angle, it would be ideal to address the plethora of complexities emerging on account of improper valuation methods, redrafting the entry norms for negating the entities with poor fundamentals, refining market-making norms, fixing more accountability on merchant bankers to avoid bringing inferior quality IPOs in the market, etc.
Sitaram Popuri
Bengaluru
Omicron threat
According to the WHO, the Omicron variant of coronavirus has spread to 89 countries and it could soon outpace the Delta variant. Given the interconnections between different parts of the world, Covid-19 has to be combated both locally and globally. Vaccine inequity gives room for the virus to mutate into new forms.
As with the Delta variant, the whole world could be hit by Omicron.
G David Milton
Maruthancode, TN
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