AAHA EEMI RUCHI...

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CIGARETTE BLUES...

Increasing cigarette prices by 50 per cent would help avoid over 40 lakh tobacco related deaths in India, said a report released by multilateral funding agency Asian Development Bank (ADB). "A 50 per cent price increase in cigarettes avoids about 27 million (or 2.70 crore) tobacco-attributable deaths, most of which are in the two most populous countries in the world. China would avoids nearly 20 million tobacco deaths, and India over 4 million tobacco deaths," said the report. For India, it said, the 50 per cent rise in cigarette prices corresponds to increase of 70-122 per cent rise in tax increase. As per the report, China, India, Philippines, Thailand and Vietnam in Asia are among the top five of the 15 tobacco using countries that account for two-third of the world tobacco consumption. For each of the five most tobacco consuming countries in Asia, "increasing taxes on cigarettes would result in substantially fewer long-term smokers and a reduction in premature deaths from tobacco-related diseases, while increasing tax revenues." In India, the report said that bidi is the most common type of smoked tobacco. It remains largely untaxed and their taxation strategies differ from the established patterns of taxation of cigarettes, which are administratively easier to tax than are bidis or other types of tobacco. "Moreover, cigarette smoking is steadily displacing bidi smoking in India. Thus, it makes sense for governments to focus on taxation strategies for cigarettes while expanding efforts to tax tobacco products more broadly," it said. The poorest socioeconomic groups in each country bear only a relatively small part of the extra tax burdens, but reap a substantial proportion of the health benefits of reduced smoking. The ratio of health benefits accrued to the poor to the extra taxes borne by the poor ranges from 1.4 to 9.5. "Thus, large increases in the cigarette tax in all of these countries are unusually attractive for public health and public finance, and are pro-poor in their health benefits." The report further said that Indian male smokers can expect to lose a full decade of life and most lives are lost are at the most productive age of 30-69 years, rather than advanced age. As per its estimates there are 4.45 crore male while 32.6 lakh females smokers in the country. "In India, the low SES (socioeconomic status) group would account for 30 per cent of marginal taxes paid, but 47 per cent of smoking deaths averted," it said.

INDIA GROWS FASTEST...BUT INDIANS REMAIN POOR

Indian economy is set to expand at the world's fastest rate over the next 50 years to emerge as a major force globally, but it would still rank as the second worst in terms of prosperity of its citizens. Over the 50-year period between 2011-2060, India will register an annual economic growth rate of 4.9 per cent, as per a latest report by Paris-based international grouping of the world's leading economies, the Organisation for Economic Cooperation and Development (OECD).
India's per-person GDP (measure of well-being of a country's citizens) will also grow more than 7-fold during this period, but the country will still rank at second place from the bottom by 2060 in absolute terms, said the report.
India was ranked lowest in terms of per-person GDP in 2011 and its position would change only marginally to second lowest after Indonesia in 2060, while China's position will improve considerably from third-worst to 16th from the down.
On the top, the US would be followed by Switzerland, Australia, Norway and Luxembourg. Switzerland is projected to be at the top in terms of well-being of its citizens. As per the report titled 'Looking to 2060: Long-Term Global Growth Prospects', China would also grow significantly during this period with the third-highest growth rate after India and Indonesia. "Income per capita in the poorest economies will more than quadruple by 2060, and China and India will experience more than a seven-fold increase, but living standards in these countries and some other emerging countries will still only be one-quarter to 60 per cent of the level in the leading countries in 2060," OECD said.
"The extent of the catch-up (in terms of living standards) is more pronounced in China reflecting the momentum of particularly strong productivity growth and rising capital intensity over the last decade. "This will bring China 25 per cent above the current income level of the US, while income per capita in India will reach only around half the current US level," it added. China would be on the top in terms of MFP (Multi-Factor Productivity that measures combined productivity of inputs into production) with a growth rate of 3.7 per cent, followed by Indonesia's 3.2 per cent and India's 3 per cent. The overall economic growth rate in China (3.9 per cent) between 2011-2060 would be third-largest after India's 4.9 per cent and Indonesia's 4.1 per cent. On the other hand, major economies like the US and the UK would witness growth rates of 2.1 per cent and 2.0 per cent respectively, OECD said. China will have the highest growth rate until 2020, but it will be surpassed by India and Indonesia thereafter, OECD said.
"This partly reflects a more rapid decline in working-age population, and consequently in labour force participation, in China than in India and Indonesia," OECD said. The annual human capital growth rate would be the highest in India at 0.8 per cent for this period, as against 0.6 per cent in case of China and 0.2 per cent for the US and the UK. OECD said that India economy is expected to be bigger than the US by 2060, while neighbouring China would emerge as the world's largest economy by as early as 2016. "The United States is expected to cede its place as the world's largest economy to China, as early as 2016. India's GDP is also expected to pass that of the United States over the long term. Combined, the two Asian giants will soon surpass the collective economy of the G-7 nations," OECD said.
Currently, Indian economy is worth over USD 1 trillion. As per OECD, the fast-ageing economic heavyweights, such as Japan and the Euro area, will gradually lose ground on the global GDP table to countries with a younger population such as Indonesia and Brazil. "The next 50 years will see major changes in country shares in global GDP... China is projected to surpass the Euro Area in 2012 and the US in a few more years, to become the largest economy in the world, and India is about now surpassing Japan and is expected to surpass the Euro area in about 20 years. "The faster growth rates of China and India imply that their combined GDP will exceed that of the major seven (G-7) economies by around 2025 and by 2060 it will be more than one-and-half times larger, whereas in 2010 China and India accounted for less than one half of G-7 GDP. "Strikingly in 2060, the combined GDP of these two countries will be larger than that of entire OECD area, while it currently amounts to only one-third of it," OECD said.
In 2011, India accounted for 7 per cent of global GDP, which is likely to grow to 11 per cent by 2030 and then to 18 per cent by 2060. Still, the large cross-country differences in living standards will persist in 2060 and India's per capita income will only be about 25 per cent of that in advanced countries, despite a robust growth. OECD is a block of 34 countries, which includes many of the world's most advanced economies such as the US, Japan, UK, Germany, France, Australia and Netherlands.

PER CAPITA INCOME OF STATES - INDIA

India has become the fourth largest economy in the world, yet it lags behind several nations in per capita income. Goa has the highest per capita income in India while Bihar has the lowest of only Rs 24,681.

Take a look at 20 states that lead in per capita income...

1. Goa : Rs 1,92,652 (2011-2012)  Rs 1,68,572 (2010-2011)

2. Delhi : Rs 1,75,812 (2011-2012)  Rs 1,50,653 (2010-2011)

3. Haryana : Rs 1,09,227 (2011-2012)  Rs 94,680 (2010-2011)

4. Tamil Nadu : Rs 84,058 (2011-2012)  Rs72,993 (2010-2011)

5. Kerala : Rs 83,725 (2011-2012) Rs 71,434 (2010-2011)

6. Maharashtra : Rs 83,471 (2010-2011)

7. Sikkim : Rs 81,159 (2010-2011)

8. Punjab : Rs 78,171  (2011-2012) Rs 69,737 (2010-2011)

9. Uttarakhand : Rs 75,604 (2011-2012) Rs 66,368 (2010-2011)

10. Gujarat : Rs 75,115 (2010-2011) 

11. Himachal Pradesh : Rs 73,608  (2011-2012) Rs 65,535 (2010-2011)

12. Andhra Pradesh : Rs 71,540 (2011-2012) Rs 62,912 (2010-2011)

13. Karnataka : Rs 69,493 (2011-2012) Rs 60,946 (2010-2011)

14. Arunachal Pradesh : Rs 62,213 (2011-2012) Rs 55,789 (2010-2011)

15. Meghalaya Rs 56,643 (2011-2012) Rs 50,427 (2010-2011)

16. Nagaland : Rs 56,116 (2011-2012) Rs 52,643 (2010-2011)

17. West Bengal : Rs 55,864 (2011-2012) Rs 48,536 (2010-2011)

18. Tripura : Rs 50,750 (2011-2012) Rs 44,965 (2010-2011)

19. Mizoram : Rs 48,591  (2010-2011)

20. Chattisgarh : Rs 46,573 (2011-2012) Rs 41,167 (2010-2011)

INDIA WEALTH

The wealth of individuals in the country is expected to double to Rs 179 lakh crore (rpt) Rs 179 lakh crore in the next four years, according to a report by Karvy Wealth. "The wealth in the hands of Indian individuals continues to grow at a decent pace," financial services company Karvy's Chief Executive and Group Head (Wealth Management) Hrishikesh Parandekar told reporters here. The report says the individual wealth in the country grew to Rs 92,26,090 crore as on March, 2012 from the year-ago's Rs 86,49,764 crore. It will almost double to Rs 179 lakh crore (rpt) Rs 179 lakh crore in the next four years and grow to Rs 214 lakh crore (rpt) Rs 214 lakh crore in the next year, the report said. Direct equity will continue to be the largest asset class, while insurance and fixed deposits and bonds will be joint second, it said. By FY'17-end, direct equity will form 28.7 per cent of total assets, up from 25.4 per cent in FY'12, which reflects the increase in confidence of investors, the report said. In the year gone by, the proportion of debt as an asset class for investments grew sizeably due to the volatile equity markets, it said, adding that debt instruments constituted for 72.3 per cent of the investments from 67.9 per cent a year-ago. This was primarily driven by reduction in equity from 31.8 per cent to 27.4 per cent, it said. Within debt, bank fixed deposits constituted the highest component at 94.42 per cent or Rs 21,82,666 crore invested in FY'12, it said.

WHO WILL BE THE WINNER...

President Barack Obama and Mitt Romney enter the final sprint before Election Day essentially deadlocked nationally in what looks set to be one of the closest presidential elections in U.S. history.

Polls on the state and national level have been, in many cases, razor close. What happens if the candidates tie in the popular vote? In the electoral vote? WSJ's Neil King and Professor of Government Linda Fowler join the News Hub. Photo: AP Images.

A new Wall Street Journal/NBC News poll of likely voters finds Mr. Obama leading his rival by a nose, 48% to 47%, as the two men crisscross the country to rally supporters in the states most likely to decide the outcome.
Final polls in many of those states, from Virginia and Ohio to New Hampshire, Colorado and Wisconsin, also find the race too close to call.
Full results of the Journal poll will be published later Sunday.
The two candidates enter the final stage with firm advantages they had from the start. Mr. Obama derives his tiny lead by holding a slightly larger base of support, 51% to 43%, among women voters than Mr. Romney has among men, the poll finds.
The former Massachusetts governor has the support of 51% of men, compared to 44% who back the president.
The poll of 1,475 likely voters across the country has a margin of error of plus or minus 2.55 percentage points.
The candidates are packing their final Sunday before the vote with events across the country. Mr. Obama begins the day in New Hampshire before jumping to Florida, Ohio and Colorado. Mr. Romney will kick off his day in Iowa before hopping to Ohio, Pennsylvania and Virginia.
With state polls continuing to show Mr. Romney lagging behind in the critical state of Ohio, his campaign is making a concerted, last-minute push to try to seize Pennsylvania, a win that would scramble the electoral map and negate a potential loss by the GOP nominee in Ohio.
A running average of all national polls maintained by Real Clear Politics now has the two men within 0.2% of one another. The average doesn't include the new Journal poll.
In the similarly down-to-the-wire 2004 clash between President George W. Bush and Sen. John Kerry, Mr. Bush actually entered the final stretch with a lead slightly above 2%—comfortable, by the look of this year's election.
President Obama got high marks in the poll for his handling of the aftermath of Sandy, the storm that lashed the Northeast last week. Nearly seven in 10 voters approved of how he dealt with Sandy, compared to 15% who disapproved. His approval was higher, 75%, among voters in the Northeast.

GOLD HAT-TRICK

With Diwali round the corner, gold investors with their fat 15 per cent gain since last Diwali appear to be headed for a hat-trick of better returns than stock markets. The returns from stock markets, as measured by its benchmark index Sensex, has been a fixed deposit-like gain of about 8.5 per cent for the same period. With the precious metal rising from Rs 26,700 levels on last Diwali to Rs 30,700 at present, an investment of Rs 10 lakh has appreciated to close to Rs 11.50 lakh now. The total gains by Diwali day next week could be even better as some experts predict that gold may breach its record price of over Rs 32,000 as demand outstrips supply on days of Dhanteras (November 12) and Diwali (November 13). While stock markets have also given positive returns since last Diwali, the performance has not been as robust as the yellow metal. The BSE benchmark Sensex has risen from near 17,300 levels to 18,755 since last Diwali -- resulting into an appreciation of Rs 10 lakh investment to close to Rs 10.85 lakh now. While stocks are still looked upon as a risky asset despite attempts to inculcate an equity culture in the country, gold has always been an integral part for its use as gifts and auspicious purchase during festivals. This will be the third instance in a row when the precious metal would outshine stock markets returns on year-on-year basis this Diwali, even as gold continues to be called an 'idle asset' for investment purposes. While Sensex fell over 17 per cent in one-year period till last Diwali (in 2011), gold came to the rescue of hapless investors with a 36 per cent rally for the same period. Prior to that, the gold had delivered a stellar 24.5 per cent one-year gain on Diwali day in 2010 -- still better than a little over 21 per cent gain for the Sensex in the same time. However, the stock market had outperformed gold on year-on-year basis on Diwali day in 2009, when the Sensex had seen a staggering 92 per cent rally in comparison to a relatively modest 34 per cent gain of the gold. Prior to that the investors had lost over half of their stock market wealth between 2007 and 2008 Diwalis, while the safe-haven demand for gold had helped it notch up a 11 per cent positive return.