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Investing-in is a one-stop web resource for learning & educating yourself on various financial assets & instruments available for making your investments. Our blog not only focuses on educating our blog readers on various international investments, but also emphasizes on other aspects of investments; especially the macro outlook for financial markets and the major asset classes (including gold).
What is a PIO card & how to apply it online?
PIO stands for Person of Indian Origin. If you are a person of Indian origin, you might want to look into obtaining a PIO card. A PIO card allows a person to have visa free entry into India for up to 15 years. It also allows a person to stay in India past 6 months with no problems. A common type that would want a PIO card would be a foreign spouse of an Indian National or a person who used to hold an Indian passport, but does not anymore.
What Documents do you need to apply for a PIO card?
-You will need to fill up the application completely.
-You will need to provide three passport size photos front facing with a white background.
-You will need copies of your passport or PAN card for Identity Proof (to obtain a PAN card, visit: http://www.pancardonline.com)
-If you are married, you will need a photocopy of your marriage certificate and your spouse’s passport.
-You will need a copy of your Naturalization Certificate and Renunciation form if you are a former Indian Citizen.
What are the Benefits of a PIO card holder?
A PIO card will stay valid once obtained for 15 years. A PIO is permitted to stay in India at long as he/she wishes during this period. There is a requirement to register with the FRRO office past a six month stay, but the process is much easier. A PIO card holder is eligible to invest in India and attend college in India.
What are the Cons of having a PIO card?
A PIO card holder is treated as an Indian citizen, but they are not allowed an inner line permit. A PIO card holder is not permitted to vote in India.
There are many offices in India that your PIO card filing can be done. The main offices are located in Delhi, Mumbai, Kolkata, Chennai, Amritsar, Bangalore, and Hyderabad. You can also visit any MHA office and learn more about it. A PIO card will not be given to anyone who is a citizen of the following countries: Afghanistan, Bangladesh, Bhutan, China, Nepal, Sri Lanka, and Pakistan.
How to open a demat account in India?
DEMAT account is the short form of dematerialized account. It serves the same purpose as a bank account in the investing world. It is necessary for you to have one of these accounts if you are planning on buying or selling any shares in the Indian shock market. As you hold money in your regular bank account, you hold all of your shares in your DEMAT account. Every time you buy or sell a share using your DEMAT account, it is noted down as a transaction.
If you are looking to invest or trade in India, It is a requirement to open up a DEMAT account. Opening a DEMAT account is a process in itself. There are forms and documents that you need to provide. You will also need a PAN card number if you need to open an account. A PAN is a Permanent Account number allotted by the IT department of India. If you are an NRI, you can get one by going to: http://www.nripan.com/apply.html
The next step would be to find and download the necessary forms. If you do not have access to a printer, you can also find the forms at any bank or stock broker in which you would like to invest through. Most of the time, there are no charges to open up a DEMAT account with a bank. You will also need to provide a few documents supporting your ID proof and address proof. If you are from abroad, your passport copy will work best as a proof of Identity.
Now, you need to know the difference between a REPATRIABLE DEMAT account and a NON-REPATRIABLE DEMAT account. A Repatriable demat account is one in which you use funds brought from abroad or that you will use abroad. Any thing in a Non-repatriable demat account cannot be taken abroad.
There are a few fees involved with getting a DEMAT account opened. You will be charged transaction fees every time you buy or sell a share using the account. There is usually an annual fee involved with keeping your account open for a long period of time. There are also maintenance charges that you need to pay to the company that you go through for keeping up with your account and taking care of everything. Generally, the fees are not high and pretty reasonable.
When you are looking to start investing your money into the Indian stock markets, a DEMAT account will be one of the first things that you will need to set up before you begin.
How to invest money in India?
Are you an Non-Indian citizen or non-resident looking to invest your money in India? It can be confusing if you have never done it before. It takes a lot of research to come up with the perfect approach to investing from abroad. To make it easier on you, we have done some of your research for you. Here we have the information you need to get started and the steps you need to take in order to invest in India while living abroad.
The first step that you need to take before you invest is to register for a PAN number. It is much easier to do this online because you are so far away, unless you plan to come to India for at least a month to get this done. You can do this online through the government website, but if you do not want to do as much work, you can always go through an online broker. They will always make it easier on you as you only need to provide them the documents and form and they will do everything else. There are many brokers out there now, however there is one agency that excels in such a service for the last 5 years: http://www.nriinvestindia.com/nri-apply-pan-card-online.html
It takes about 15-20 business days to receive your permanent account number. After you have your PANcard, you will need to open a bank account which could be a NRE or a NRO account. These could come with two options: repatriable or non-repatriable. You will need to decide which one suits your needs the most. An NRE account is repatriable and an NRO account is Non-Repatriable. After you have opened a bank account, the next step would be to open a Demat account.
You will need a Demat account in order to buy or sell shares when investing in the Indian stock market. To open a Demat account from abroad is a fairly easy process now. You can do the whole process from your country without having to come to India. There are many brokers now for this process as well. You will need to fill up the application and provide the necessary documents and send it via post to the brokers address in India. The broker that you open up a Demat account with, will usually be the one you are investing with as well. There is another option too. You can also use your bank account as a Demat account if you wish to. This might make it easier and the process faster.
After that, there is one more account that you need to open before you get started. It is called a brokerage account. You cannot invest any money unless you get a stock broker first. All of the brokers charge differently, so again, this is where you need to research. Find out which one gives you what you need and fits your budget. You can also choose a discount broker that allows you to make more of your own decisions. A broker like www.NRIinvestIndia.com can help you with all of these services in one. So there you have it, the sooner you finish all of this, the sooner you can start investing.
Happy investing in India!
How to fill PAN application form 49AA online?
Although, it is easy to download the forms you need from the internet, sometimes, it is not clear as to which ones are the correct forms. There are many changes in the forms as the years pass and making sure that you are downloading the updated version can become a task in itself. If you are having a problem with finding the right form for NRI, OCI, or PIO, then we have just the place for you to look and download your form. The updated forms now are 49A and 49aa. Form 49a is used for residents and form 49aa for non residents.
Once you download the correct form, then it is time to turn it in to the IT department or the PAN department. There are now PAN departments all across India in almost every city. Some cities have 2 or 3 offices. You can locate them by using google. Ex: “(your area) pan card department for NRI”. If you are not living in India, then it would be tough for you to give your application to the PAN department. They have online brokers working with NRIs to make things easier.
PAN card departments only serve one purpose. They are there only to accept and submit your PAN card applications and get you a PAN number allotted to you. Because they receive so many applications everyday, they are very strict while going over the applications and will not accept them if even the smallest mistake is made. So, make sure that your forms are filled completely and correctly. Also, make sure that you are aware that all of the information you provide in your application will be kept on record by the IT department. Also, It is not the PAN department that allots you a PAN number, it is the IT department that does that.
If you already have a PAN card, but the information mentioned on the card is incorrect, you will have to apply for a duplicate pan card and provide proof that the information is wrong. The PAN card department does not give refunds or discounts if any information is wrong. You must apply again and pay all of the fees again.
The New PAN Card
All new pan cards printed will have a colored photo in the corner. This means that you will need to provide two colored passport photos with your application. The new PAN card has a hologram along with other security and tamper-free features to help with identity theft.
The fees for PAN card are always changing, but currently if you are living in India, they are Rs.94. If you are not living in India and you are an NRI, the fees are Rs.944. When discussing PAN card, an NRI mean an Indian who is a resident in another country, an OCI, a PIO, or a foreign passport holder with no ties to India. If you are living in the US, UK, UAE, Malaysia, Japan, etc., you can simply apply for a PAN card through a broker to make your process easier. A good one would be:http://www.nriinvestindia.com/pancard.html
Once you have your PAN card, it will be valid forever and does not expire. The only reason that you would need to apply for a duplicate PAN is if you lost your PAN card, your PAN card was damaged, you had a change in your information, or you have a mistake in your PAN card. Other than that, the only reason would be so that you can update your card to the new design and have a new photo.
If you have applied for a PAN card, but never received it, this most likely means that it was lost in transit at some point. In that case, you will also need to apply for a duplicate PAN card in order to receive it. When you do this, your PAN number stays the same.
Tracking with the PAN department
Nowadays, you can find out your PAN number before you receive the PAN card. The UTIISL website now has a tracking system that you can use to find out the information before it is finished. You will be asked to enter a coupon number and then you can see your details. The coupon number will be on your receipt when you submit your application to the government. The details that you will access might also have courier tracking details.
Speed up your process using Tatkal service
It usually takes about 20-30 business days to go through the entire process. If you are looking to speed things up, we advise you to go through a broker so that you can make sure all of your forms and documents are correct the first time. They can give you step by step instructions so that no mistakes are made.
Before applying for a PAN
Be sure that you don’t already have a PAN card number. It is illegal to hold more than one PAN card number.
You will need an ID proof, and Address proof, and 2 photos.
The PAN card department will not start your process until they have received the payment in full.
If you are not ready to apply for a PAN card, but you have questions, email: prachi@nriinvestindia.com.
One of the segments where investors generally hesitate investing is infrastructure fund. This is because of less knowledge and sometimes wrong guidance.
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It is found, investors can easily get detailed information regarding various funds including large cap funds, mid cap funds, small cap funds and various sectoral funds, while it is quite difficult to collect requisite information regarding infrastructure funds. However, now the time has come to explore infrastructure fund, which is one of the significant segment of mutual funds.
Initially, infrastructure funds were only private placement funds owned by gigantic investors in the form of major pension plans. But, then the growth of different types of exchange-traded funds (ETFs) gave rise to some infrastructure-focused investments in the market for individual investors. In infrastructure funds, investments are basically made in the segments like construction of transportation, energy and communications projects.
It is believed that a infrastructure fund is a type of mutual fund known as thematic fund. Where sectoral funds facilitate investment in specific sectors including information technology, power, gas, oil and metals etc, the thematic funds helps investors to invest in some themes like infrastructure, retail industry and outsourcing firms.
The Great Indian Gold Rush has recently made noise regarding this relatively newer fund. It has introduced three kinds of schemes namely infrastructure, consumption and outsourcing.
Out of these three schemes, infrastructure fund was the one which grabbed more eyeballs.
Acknowledging this latest trend, numerous novel firms are now planning to launch new services in infrastructure funding in recent time. But there are only five which have sizeable money under management. They include:
1. Prudential ICICI Infrastructure Fund
2. DSP ML TIGER Fund
3. UTI Thematic Infrastructure Fund
4. Tata Infrastructure Fund
5. Sundaram BNP Paribas Capex Opportunities Fund
It is worth noticing, all the above listed funds have been launched before 2006.
An important factor that attracts more investors to infrastructure fund is that investors can invest in them whenever they like and wherever they like.
There are basically two types of infrastructure funds; one is open ended and the other one is closed ended. Open ended means, investors are free to choose time of investment, while in closed ended investors are bound to sell their units for a specific period of time. That minimum period is decided by the fund itself.
So, when are you planning to invest in infrastructure funds?
Newcomers to trading foreign currencies are immediately astounded by the enormous amount of information that must be assimilated daily. Currencies do not trade in a vacuum. In today’s modern era of globalization, currencies are the “fulcrum points” upon which global commerce teeters to and fro. Currencies come in pairs, and any information, fundamental or technical, that can impact either country’s economy in any way must be taken into account by a forex trader or he risks an unanticipated financial setback in the market.
Currency brokers and traders alike attempt to stay abreast of every correlation in the market that might suggest a potential trend in the making. Fundamentals do move the currency market, but often it is a combination of many factors that produce a noticeable change in direction, making it difficult to pinpoint the actual details leading to the shift. The value of the Rupee has declined some 20% in the past ten months for a number of reasons, but tracking its correlation to the Japanese Yen is one way to gain insights into what might happen next.
The following diagram illustrates this market relationship between the Rupee and the Yen over the past two years:
Much has been written about the ongoing success story in India. Over the past four decades, the nation has benefited from corporations in developed economies in the West “off shoring” various activities to Indian enterprises due to low labor costs, favorable legal infrastructure, and low government corruption. GDP growth over he period has been significant, and although present forecasts may be 5.2% for 2012, there is not a developed economy in the world that would not be happy with this figure. In India, however, this figure represents a material decline from years past. Inflation and slower growth are now true concerns, and the value of the Rupee has fallen as a result.
What is the correlation with the Yen all about? As a developing economy, Indian investors must accept the vagaries of the “carry trade” in today’s world of global investing. International banks, corporations, and investors often borrow funds in a low interest environment and then invest them where potential returns are higher. The Yen and the U.S. Dollar are typically the “carry” currency in this scenario, due to their near zero interest rate postures at the moment. The investment side of the transaction has often been in Indian securities, due to their potential for high returns.
The “carry trade” scenario works fine as long as relative currency valuations remain constant or the rate for the target country, in this example India, appreciates. When the local currency appreciates, the investor reaps two rewards – the return on his security and a bit extra from the better exchange rate when funds are repatriated. While the first half of the chart illustrates favorable conditions, the past year reflects how quickly capital flows can reverse in today’s electronic trading environment.
The first “Divergence” occurred following the earthquake in Japan and the political strife in Europe. In both cases, funds were repatriated back to their respective homelands, causing a massive shift in “carry trade” positions, especially in India. As the Yen strengthened, the Rupee fell. An increase in domestic interest rates by the RBI reversed this trend, causing a brief “Convergence”, but a “double-dip” recession in the majority of countries in the Eurozone has created a more “Risk-Off” mentality to grip the minds of the investment community.
At present, another divergence has taken place. What is a likely scenario for the future? A weaker Yen may yet cause another convergence. Stay tuned.
Housing and Urban Development Corporation Ltd (HUDCO) Bonds – Download Application Form
Issue: Housing and Urban Development Corporation Limited (HUDCO) Bonds – Tax-free, Secured, Redeemable and Non-convertible Bonds
Issue opens: 27 January 2012
Issue closes: 6 February 2012
Credit Rating: Fitch AA+ (ind) by FITCH & CARE AA+ by CARE.
Allotment Basis: First-come-First-serve basis.
NEED APPLICATION??
DOWNLOAD >> Housing and Urban Development Corporation Limited (HUDCO) Bonds Application Form | >> CLICK HERE << |
BOND PARTICULARS:
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TAX BENEFITS
1. The income by way of interest on these Bonds shall not form part of total income as per provisions under section 10 (15) (iv) (h) of I.T. Act, 1961;
2. There shall be no deduction of tax at source from the interest, which accrues to the bondholders in these bonds irrespective of the amount of the interest or the status of the investors;
3. As per provisions under section 2 (29A) of the I.T. Act, read with section 2 (42A) of the I.T. Act, a listed Bond is treated as a long term capital asset if the same is held for more than 12 months immediately preceding the date of its transfer. Under section 112 of the I.T. Act, capital gains arising on the transfer of listed Bonds shall be taxed @ 10% without indexation;
4. Wealth Tax is not levied on investment in Bond under section 2(ea) of the Wealth-tax Act, 1957.
SALIENT FEATURES:
- The Bonds are issued in the form of tax-free, secured, redeemable, non-convertible bonds and the interest on the Bonds will not form part of the total income.
- In case of over-subscription; allotment shall be on first cum first serve basis upto the date falling 1 day prior to the date of oversubscription and on proportionate basis on the date of oversubscription.
- Credit rating agency CARE has rated the bonds “CARE AA+” & FITCH has rated the bonds “Fitch AA+ (ind)”. Instruments with this rating are considered to have the high degree of safety regarding timely servicing of financial obligations. Such instruments carry very low credit risk.
- The bonds are fully secured by way of floating first pari passu charge on the present and future receivables of the company to the extent of amount mobilized under the issue. The security cover is 1.0 times of the outstanding Bonds at any point in time.
- The Bonds bear an attractive coupon rate; 8.10% p.a. for Tranche 1 Series 1 (bonds maturing after 10 years) and 8.20% p.a. for Tranche 1 Series 2 (bonds maturing after 15 years). (Tax free).
- HUDCO shall pay 8% p.a. for Tranche 1 Bonds as interest on the Application amount retained.
- HUDCO shall also pay 4% p.a. on refund of application amount. Such interest shall be paid along with the monies liable to be refunded.
- Issuance will be in DEMAT as well as PHYSICAL form. The bonds will be listed on both BSE and NSE; facilitating trading of these bonds.
- Investors can pledge or hypothecate these bonds to avail loans.
NOTE:
For all the categories Tranche-I Series 1 Bonds and Tranche- I Series 2 Bonds shall carry interest at the coupon rate of 8.10% p.a. and 8.20% p.a., respectively, payable annually on the Interest Payment Date.
However, an additional interest at the rate of 0.12% p.a. and 0.15% p.a. shall be payable to the Allottees under Category III for the Tranche-I Series 1 Bonds and Tranche- I Series 2 Bonds respectively. Accordingly, Tranche-I Series 1 Bonds and Tranche- I Series 2 Bonds Allotted to Category III Investors, shall carry an aggregate coupon rate of 8.22% p.a. and 8.35% p.a., respectively, payable annually on the Interest Payment Date.
Please note that the aforesaid additional interest of 0.12% p.a. and 0.15% p.a. shall only be available to the original Allottees and shall not be available in the following instances:
1. In case the Bonds are sold and/or transferred by the original allottee, the transferee will not be entitled to receive the interest at the coupon rate of 8.22% p.a. and 8.35% p.a., for the Tranche- I Series 1 Bonds and Tranche- I Series 2 Bonds respectively and shall only be entitled to receive the interest at the coupon rate of 8.10% p.a. and 8.20% p.a., for the Tranche- I Series 1 Bonds and the Tranche- I Series 2 Bonds respectively. However, in case of any transfer by a permanently disabled Allottee to their legal heir(s), the transferee shall continue to be entitled to receive interest at the coupon rate of 8.22% p.a. and 8.35% p.a., for the Tranche- I Series 1 Bonds and the Tranche- I Series 2 Bonds respectively.
Where the Bonds are held in joint names and subsequently there is a change in the sequence of the names of the joint Bondholders, the joint Bondholders subsequent to such change in sequence of names, will no longer be entitled to receive the interest at the coupon rate of 8.22% p.a. and 8.35% p.a., for the Tranche- I Series 1 Bonds and the Tranche- I Series 2 Bonds respectively and shall only be entitled to receive the interest at the coupon rate of 8.10% p.a. and 8.20% p.a., for the Tranche- I Series 2 Bonds and the Tranche- I Series 2 Bonds respectively. However, in case of change in name of any of the joint Bondholders, such joint Bondholders shall continue to be entitled to receive interest at the coupon rate of 8.22% p.a. and 8.35% p.a., for the Tranche- I Series 1 Bonds and the Tranche- I Series 2 Bonds respectively.
