NEW NORMAL

 Inflation is started its downward journey with approx.7.1%  this week. The CPI  and  WPI  both are coming down, and we have a comfortable condition with forex reserve. The crude is still around  $115per barrel, but the good news is that we are getting a massive discount from Russia. But the remaining discount is still good enough for our economy; the last few days back our energy cost is not increasing. The world over inflation is high with major central banks increasing rates to tame inflation, every country has a band for inflation which indicate its comfort up to that level. The availability of easy money is getting over and liquidity is getting sucked. The war between Russia and Ukraine is not over yet with no sign of ending soon. The conflict has its implication with increased commodities prices all over the world. The continuity in crises gives us the best opportunity to overcome the problems basically, our economy is not increasing as desired.  The loss for citizens with 40k pe

 Recently, news came from IRDAI that they are planning a small insurance company in both the life and general insurance sector. Our insurance penetration in life and general insurance is significantly less, i.e. life insurance penetration is just 2.5 to 3 %  and general insurance is just 1% of the total population. We know by 10 years back  RBI had given some Universal and Small Finance Bank as per head bank account or banking facility to the ordinary citizen was less. Along with these payment bank licenses, which changed the banking penetration increased, and awareness of the financial products increased. As said above the insurance product penetration is not as expected. The small insurance company will have less compliance burden than the full-fledged insurance company. The solvency margin and capital requirement will be less. Just sometime back IRDAI gave authority to the insurance companies to launch products without its permission or allow them to sell, then take its permission.

 All major economic indicators are out for the month of may2022. Last month's GST figures are out with 1.4L down from 1.68L but if we see the effect of inflation the figure for May 2022 is very authentic. The GST figures for the calendar year 2022 are above 1L crore. Just in the last week of May2022, the government had reduced the duty on petrol and diesel, as GST collection is giving the much-needed confidence not only to the government but also to the market. The PMI index for the last three months is well above the expansion level, for May2022 it was 54.6 which is just a little less than 54.7 in the month of April2022. The export of merchandise is increasing with every month despite inflation being a global phenomenon now.  The comfort level of developed economies is different than ours. Also, other items export order is increasing as compared to April2022, like capital goods and services. Right now, our global trade share is very less i.e. around 2%, but the China plus 1 for th