June 30, 2020 | Adamas University

Why not invest in Mutual Funds during Post COVID 19?

What is Mutual Fund?

In times of enhancing need and mobilization of domestic savings in lucrative investments, the importance of mutual funds have increased significantly. Mutual fund acts as a financial intermediary by pooling up the savings of small and large income earners and help these investors in deriving the benefits of capital market advancement. This intermediation between the suppliers and customers of financial resources gains importance globally on account of attractive returns with reduced risks.

The Mutual Fund industry in Indian economy has been developing constantly since its inception. Its Assets Under Management (AUM) has been experiencing a radical increase from only Rs.25 crores in 1964 to Rs.23.93 lakh crores till April 2020.

Why not invest in Mutual Funds during Post COVID 19?

Since the outbreak of COVID-19 in India, the global contagious disease caused by coronavirus in January 2020, the stock markets have experienced an extensive crisis with severe dampening effects in the entire global scenario. This has affected the Indian Mutual Fund Industry as well.

Due to the lockdown announced by the Indian Government, the economy has got slower and will continue to remain slow over the next few months. For most businesses, the slowdown can be in the form of supply disruptions, fall in consumption demand, and stress on the banking and financial sectors.

The equity markets have seen an unprecedented sell off across the board in the last few months. This sell off has been occasioned by the rapid spread of the pandemic in several countries and therefore, some disruption was expected to happen in the major global economies. Such disruptions affect economic growth, output, aggregate demand and supply, employment and a host of other key macro-economic variables. The adverse impact on these variables results in lower income for households, unemployment, and also lower earnings for companies. It is this chain of factors that caused the selloff thereby magnifying the probability of a global economic slowdown.

Several factors also highlight that the Indian Mutual fund sector is not at all worthy for investment in the present Post COVID 19 scenario:

(i) New Fund Offers (NFOs):

NFOs by mutual fund houses have been dwindling since the outbreak of COVID-19 largely due to the nationwide lockdown and its impact on overall investor sentiment. The number of NFOs was 11 in January, 6 in February, and it further dropped to just one in March and nil in April.

(ii) AUM of Indian Mutual Fund Industry

The total AUM of the Indian mutual fund industry declined by 9.82% between December 2019 and April 2020 due to COVID-19 effect. The AUM of open-ended mutual funds decreased by 9.97% during the same period. Moreover, assets in equity-oriented mutual funds declined by 3.5% between December 2019 and April 2020 due to COVID-19 effect. That apart, assets in equity-oriented mutual funds recorded a continuous decline from February 2020 to April 2020. However, it is noticed that assets in debt-oriented mutual funds and liquid funds increased by 2.2% and 0.8% respectively between December 2019 and April 2020 due to COVID-19 effect.

Table 1: Growth of AUM in the Pre-COVID and Post-COVID 19 scenario (Rs. in crores)

(Source: website of AMFI)

(iii) Retail Participation in Mutual Funds:

The share of individual investors in mutual fund assets declined continuously between December 2019 and April 2020. On the other hand, the Indian mutual fund industry witnessed an increase in the share of institutional investors in mutual fund assets continuously from December 2019 to April 2020.

Table 2: Share of Individual and Institutional Investors in Mutual Fund Assets (%)

Month	Individual Investors	Institutional Investors
December 2019	53.4	46.6
January 2020	52.7	47.3
February 2020	52.7	47.3
March 2020	52.2	47.8
April 2020	52.1	47.9

(Source: website of AMFI)

(iii) Debt Fund crisis on account of COVID-19 outbreak with reference to Franklin Templeton Mutual Fund:

The reason for debt fund crisis in Franklin Templeton Mutual Fund was dramatic and sustained fall in liquidity in certain segments of the corporate bonds market on account of the COVID-19 and the resultant lock-down of the Indian economy. Franklin Templeton invested in lower quality papers/instruments for generating more returns. Lower rated papers usually have very low liquidity as they cannot be sold immediately in the market at a fair valuation in India.

This incident shattered the confidence of the entire debt mutual fund investors, who rushed to withdraw their investments from credit funds as well as other debt MF schemes.

(iv) Mutual Fund Returns:

As per statistical data on Mutual Fund returns obtained from Mutual Fund Insight report 2020, it has been observed that amongst debt funds, mid-duration, short-duration, ultra short-duration and credit risk funds performed better in the pre-COVID period. Surprisingly, long-duration debt funds and dynamic bond funds performed better in the post-COVID period.

Post-COVID returns of all equity funds except pharmaceutical funds were negative in 3-month and 1-year. Amongst equity funds, large-cap funds, international funds, pharmaceutical funds and technology sector funds generated positive returns in the post-COVID period in 3-year. 5-year and 10-year post-COVID returns of all equity funds were positive barring infrastructure funds which generated negative returns in the 5-year period.

Thus, the market fall was like a financial cyclone that waved away the faith and stability despite miscellaneous liquidity measures taken by the Government of India. The markets were worried on account of lack of clarity in near future. This led to massive fluctuations in the markets, which in turn affected the Indian Mutual fund sector. Again, with the sudden shut down of six debt funds of Franklin Templeton, the investors’ fear grew up with increased lack of confidence about the way forward.

However, this tough realism of drastic phase will again be overcome with boom in near future as soon as this pandemic moves out with invention of coronavirus vaccines with reduction in number of affected and deaths along with the implementation of several innovative government policies.

AGRICULTURE: A SCIENTIFIC ART OF CULTIVATION

Student Contributor: Sulekha Roy (B. Sc Biotechnology 4^th semester)

Indian agriculture is undoubtedly the biggest livelihood giver. Sustainable agriculture helps for comprehensive development as it contributes very significant value to the GDP. The agriculture sector is gaining importance regarding food security, environmentally sustainable technologies followed by the scope for employment. Such environment sustainable technologies include conservation of soil, management of sustainable natural resource as well as protection of biodiversity. Indian agriculture and its related activities all together had seen a green revolution, a yellow revolution, a white revolution, and many more. India has diverse climates where we can grow different types of the crop at the same time of the year on different locations. Our nation is blessed to have such geographical variations we are not dependent on particular weather.

Let’s discuss what agriculture is all about. As we all know that science is a kind of art or in other words, science is a combination of art with logical thinking and creativity. So we can say agriculture is the scientific approach, art of cultivating plants and rearing livestock. It includes farming in all of its sectors which includes growing and harvesting crops and livestock. Also, agriculture was an opening door in the emergence of humans and opened a new area of interest in science. Now a day so many scientific tools and techniques involved in agriculture used to improve plants, animals, and microorganisms. The implementation of biotechnology in agriculture is known as Agricultural Biotechnology. Through biotechnology, a scientist can customize the crop plant by identifying specific traits. Technology has indeed played a role in developing the agricultural sector. These technologies modernized the agricultural field India has experienced numerous revolutions to substantially improve and increase productivity, food demands, and crop growths without associated with any ecological or social harm. The green revolution brought immense change in all sectors of agriculture giving it an all-new approach.

While the Gene revolution, in which a global and agriculture research system disease-free planting material, and produces crops that resist pest or disease and decreases the uses of chemicals that are harmful to the environment and humans also. The journey from green to gene revolution has seen enormous growth in agriculture techniques, irrigation patterns, and a different scientific approach. The biotechnological tools that are important for Agricultural biotechnology:

(a) Conventional plant breeding

(b) Tissue culture & Micropropagation.

(d) Genetic engineering

(e) Molecular diagnostic.

Scientists provide a set of tools which is incorporated suitability with other technologies that can get implemented for the sustainable development of agriculture and food industries. As with each passing of the year, the population is increasing food is becoming one of the top priority, thus with an increasing demand for foodstuff, better quantity and better quality yield are necessary.

FUTURE OF AGRICULTURE

We face numerous challenges with the growth of the population, with the climate crisis. The Earth population is presumed to grow to 9.7 billion over the next 30 years. That’s a lot of individuals to feed, especially when we consider the vast hunger issue the world face today. More than one-quarter of the planet’s population that is around 7.5 billion people suffer from malnutrition, nearly are 1 billion are hungry.

HOW TO BE A FOOD PROVIDER TO THE PLANET OF NEXT GENERATION?

If we want to be food providers for the world of next-generation, the next 40 years we need to produce the same amount of food as we did over the last 1000 years. The real secret is sustainable production which should be with fewer inputs, less water, with less fertilizer, fewer pesticides moreover this also needs to be viable. To address this enormous issue of food security agriculture system requires new approaches and techniques, which can not only increase productivity but also ensure environmental protection and conservation of limited natural resources. We can go for many techniques as follows:

Enhanced hybridization– To imprint the quality and quantity of crop products.

Farming desert– Proper usage of barren lands to cultivate appropriate crops with various irrigation systems.

Continued digitization– Self-driving tractors, robots, and drones operated by a farmer’s mobile phone or tablet will enable farming round the clock during unfavorable seasons. Artificial intelligence, satellite imagery, and the software will help and allow farmers to make a decision in real-time which will lead to saving time, money, and even maybe a crop from the destructive impact of pest or extreme weather.

Replace chemical fertilizer– Chemical fertilizers have an obnoxious effect on the environment.

Organic farming- Usage of natural fertilizer and manure to improve the quality of food. New emerging technologies have shown positive impacts on agriculture. In most countries, agricultural researches and pieces of training, are offered by both government and private sectors. India is one of the leading countries across the globe.

The agricultural education system in the country offers various degree programs such as Agriculture, Veterinary science, agricultural engineering, horticulture, fisheries, food science, and many more. Agriculturalists are the backbone of the country, without them country is unable to provide good quality food to individuals. Not only this but its also the fact that we won’t be unable to wear clothes. The business and job market has been improved every day with increasing demand in the food industry.

Some career opportunities are

Environmental Engineer
bioinformatician
Agriculture teacher
Food scientist
Biophysicist or Biochemist
Agricultural Engineer
Veterinarian
Plant Molecular biologist
Genetic researcher
Crop production analyst
Agricultural Biotechnologist etc.

Reasons to study Agriculture:

Within another three decades, the population of the Earth is likely to be increased many times than today, and to provide good quality nutritious food available to individuals all of the countries will have to be dependent on agricultural products to fulfill the need for food. New agriculture reforms a technology that will indeed help a large section of people with new job opportunities and livelihood. The raw material produced from agriculture and improvement in agribusiness will further help in the development of the industrial sector.

Impacts of COVID 19 on agriculture across the globe

As the pandemic COVID 19 unfolds, every country is facing various kinds of challenges. As per statistical data, before COVID 19 pandemic struck, 800 million people worldwide were suffering from chronic undernourishment. The developing countries and the countries facing pervasive poverty and lack of health care systems have been intensely affected. Food security has become a fight across the globe. The international communities and governments throughout the world have emphasized food and food-based safety. With improved technological advancements, a high yield of crops can be cultivated and harvested economically. Farmers and consumers will enjoy the benefits of these technological developments. Recent improvements in the agricultural field will accelerate the economic prosperity of the country.

Be that technical Smart, henceforth hackers become fool

Contributor : Abhishek Roy, Ph.D, Associate Prof, Adamas University

Don’t trust anybody instantly!

There is always a high probability of us being a victim to hackers. Our valuable information is always getting exposed to the world of hackers and can be stolen at any point of time. Why aren’t we thinking much about it? Why are the people not concerned about their valuable information that might get stolen? How are these hackers getting access to our bank accounts, important information and other data? There are so many questions that may arise but Alas! No one is bothered about these petty things unless it happens to oneself or to the near and dear ones. If ever such a question had come to your mind, then have you ever tried to find a solution to such problems? To be honest, in the real world, no data is protected. Everything is vulnerable. Not a single solution is enough to protect a piece of information but on the contrary there is also no rocket science behind this, and by taking small safety measures we can easily protect our data, information, or money.

To avoid problems that may result in the loss of important data, we have to think in a different manner other than the traditional process of web browsing. What do we do while working on the internet? The general steps that every individual follows while surfing: (i) Firstly, we open a web browser and open a search engine to search for a topic we are looking for. (ii) In the search bar, the topic that is required is written and accordingly the search engine provides us with the top viewed/ rated results according to the typed text (keyword) (iii)We click on these listed links without giving a second thought and proceed further. The problem begins from here. To avoid such problems that might help us in getting exposed to hackers, few steps need to be kept in mind and followed. Firstly, choose a well-known browser, go to its settings and make some changes (i) tracking should be turned off (“do not track”), (ii) pop up needs to be blocked, (iii) clear the cache on a regular basis, (iv) deletion of the history should be done on a regular time interval, (v) properly set the JavaScript option, (vi) clear the saved passwords, (vii) disable the payment method option in auto fill and many more. Now let’s move towards search engines. While searching any keyword or any information always try to search in at least two search engines and compare the results. If the results found are trustable then only click on the particular result or link. After clicking the search result, whatever link(URL) opens in the browser, check it properly, and if possible search for the domain details in the website ‘who.is’ from where you will get more information about the domain, such as the age(Validity) of the domain, and other information about the domain. After going through ‘who.is’ you will get some idea about the website.

Never trust instantly. Suppose you are searching for some company’s customer care number, and you Google it, you will get some phone number displaying along with that company’s name you have been searching for. Don’t assume that the particular number you have got from the search result is of that particular company you have been looking for. It might be a ‘Honeypot’. A Honeypot is a wild used term that refers to a pot that has been created by hackers and looks realistic and similar to the original resource but as you enter into it, it grabs all your valuable data and information therefore leaving you in huge trouble. Now, the question arises, how do we get to know about this honey-pot and how can we avoid falling into the trap? One can avoid it by searching for the original website of that company and can get the phone number from their “Contact Us “ page or similar kind of page of that website. Or else one can search for the number in any search engine and check the results to verify; also you can check the number in “True caller” or similar kind of apps for more information gathering about the number to verify the number before making a call. These small steps can make a huge difference and protect you from falling into any kind of trap.

Nowadays internet usage has taken its way of transformation of browsing from web browser to mobile apps. We have to be very conscious while installing any application. Whenever any app is installed, it should be from ‘Play Store’ in case of Android user and “App Store” for the iOS user and accordingly others from their respective sources. Just selecting the proper source is not enough, you have to check what permission the apps are asking from you, as for example suppose you want to use a photo edit application, but while installing the particular application, it asks for “your phone contact list” – Have you ever thought of it? Is it really necessary to give access of the contact list? Also, you need to check the publisher of the application, and go through the review sections, give your valuable time while installing an application. The time you had spent while installing to check, it won’t disappoint you. And one valuable warning “never ever install an app from any unknown sources” or from any application, links received via mail, messenger, WhatsApp or any other sources.

In terms of the monetary transaction very consciously use the ATM Card/ Debit Card/ Credit Card/ Net Banking or mobile wallet. For cards if possible cover the “CSV” number with a piece of paper using glue, if needed remove the paper and after use again paste it. For “RFID” enabled cards, if possible always cover it with “RFID” Blocker. Just remember one thing very carefully: hackers can withdraw money from your card without having PIN or OTP. So keep the cards information safe and secure with you. Swindlers or scammers can be found everywhere in the net. One needs to be very careful in every transaction while using the internet. Never ever donate arbitrarily to anyone. Before making any transaction, check all the proper documentation and valid payment gateway. Always remember one thing that the scammers are always trying to find a loophole and if they get a chance, they will try to do forgery upon the individual.

Images and videos are randomly received through WhatsApp, Messenger, Phishing emails, or similar kinds of applications. These videos or images may contain malware therefore shouldn’t be opened if received from any unknown sources.

Another commonly known incident that is going on nowadays is through phone calls. Stranger calls are often received that tells that by mistake he had transferred money into your account, and hence refund the same or similar kind of stories is shared. Most of these kind of scenarios are created by scammers, but if you want to crosscheck, please check it via net-banking, phone-banking or directly go to the bank and check the balance, don’t open any app or do not scan any QR Code to check the transactions. Crosscheck through any one of the methods after disconnecting his call.

Though most of us are familiar with these scams still we are not able to prevent it. It is still occurring with our neighbors and our relatives, because we are not getting involved in spreading awareness. If we want to stop these scammers, we have to increase the awareness towards our society.

Changing Role of CSR Activites in Society

“We make a living by what we get, but we make a life by what we give”

Winston Churchill

Introduction

FSG Consulting once said, “What is the role and responsibility of your business in a time of Chaos and Crisis?” – will be the call of the hour. In the last couple of months, time has changed tremendously. Every hour is posing a difficult challenge to society. Updates are continuously crossing limits of itself every day. Everyone, everything is locked down, fearing the unseen. This crisis has crossed all the limits. The uniqueness of the situation is that we are now united against the unseen – to control, to resist, to defeat. Sharing experiences about new inventions, discoveries help us to unitedly fight against the pandemic. Social distancing and work from home, are buzzwords now. It is not that a few people are allowed to work from home, it’s the entire workforce thatis engaged in this new normal.

Under Schedule VII, of section 135, of Companies Act, every corporate is mandated to spend 2% of the net profit under activities mentioned in the aforesaid section. As per the mandate, companies with a net profit of ₹5 crores or a net worth of ₹500 crores or a turnover of ₹1000 crores have to spend 2% of the average net profits of the last three years to corporate social responsibility.

The Ministry of Corporate Affairs recently declared that every spending on health care for this COVID 19 pandemic will be treated as CSR spending. Central Government created a fund named as PM Cares for fighting against the pandemic by arranging all-around support and India Inc. have contributed thousands of crores to support the initiative.

The challenges posed by COVID 19 to the industries, left no other way than to find out innovative ways to tackle the whole process. Thus finding out the innovative solution provides an opportunity to redesign the business processes. CSR does help the society in different manners including all-round development of society itself, internal and external stakeholder management, sustainable supply chain management, and all the aspects of human rights. United Nations earlier declared a Sustainable Development Goals (SDGs) and CSR forms a part of it. In this situation, it can be said that fighting the COVID 19 is a part of maintaining sustainability to the mother earth.

Transmission in CSR Activities

We all are aware of the proverb – “Charity Begins At Home”. It implies that everything should be done to start from the base. For corporate houses, it is about taking care of their employees. The contractual and daily workers are at the bullseye now and taking care of them regarding continuing some part of their wage or simple confirmation that they won’t lose their jobs even in lockdown, will do magic. According to Businessline,Tata Group has promised to all its daily wage earners, a full monthly wage for March and April.

Not only during this pandemic but during the normal time also, corporates will need to focus on sanitization, preventive health checkups for all employees, comprehensive medical facilities continuously without not depending more on one-time donations to various funds. Corporates need to work collaboratively with Government so that they can reach the base of the pyramid to help and extend their CSR Activities.

Corporates are in many senses working for the improvement of social life, alleviating poverty, public health from the very beginning and these are the basic CSR activities every company performs. But during this time of pandemic companies have to pose strategically to improve the scenario. Every company has bright minds, so doing brainstorming sessions will allow innovative ideas to follow.

Therefore, a collaborative work environment should be taken into account to promote implementation, monitoring, and evaluation of converged organizational culture. CSR activities should not be taken as granted by the corporations. CSR can be a major activity during this kind of pandemics or natural disasters. With this opportunity, another question arises as to how efficiently the CSR fund can be utilized.

As CSR funds are kept separate from the Net profit that means the company is somehow depriving the shareholders of their rights. So, every coin should be counted. So before release funding, every corporate should assess the viability. Third-party assessment can be done to ensure an effective result, along with peer reviewing and employee involvement. The company should take a systematic approach, by planning, implementing, monitoring, and evaluating the release of CSR Funds.

During pandemics, the poor and weak are badly hit. They are the most vulnerable section of society as they don’t have enough support to stand up again. Companies need to be more sensitive towards them in building their resilience. Expenditures should be poised evenly so that CSR activities can help these people to face the situation again. This also helps corporates to present their brand well to society.

CSR’s Contribution to R&D

CSR funding can also be shared through Research and Development mode. There may be a common research program through which the “zoonoses”, that is the diseases that spread from animal to human can be stopped or in case of spreads like COVID 19, further medical treatment-related research can be obtained. For this, all medical practitioners to be pulled over under a common umbrella and “One Health, One Goal” program may be launched where all experts will work under a common goal under funding from CSR activities. The results of the research should not be owned by anyone company, rather should be distributed for the betterment of humankind.

The protection of the ecosystem will also be a good opportunity to distribute CSR funds. Destruction of natural resources poses problems on nature which is getting worse everyday. The Climate Change Summits are showing paths but industries that are polluting a whole should take necessary action to stop that. Land uses are changing completely which poses a threat to agricultural production. These disruptive changes are posing threats to society as a whole. So, CSR activities to be aimed at minimizing these disruptions.

Conclusion

Holistic actions are needed for a safer future for business houses. The holistic developments include sustainable business practices by effective and efficient resource allocation, future strategy building by keeping the fact in mind disruptions can occur at any time without any precaution. The organization structure and culture should be flexible enough to accept any changes. CSR activities should aim at providing branding support for the companies.