Fighting emus, gold, India eyes shares
A year ago, S. Kashinath, an illiterate labourer from India's southern Tamil Nadu state, lost 300,000 rupees ($5,600) in savings he invested in a pyramid scheme promising high returns from emu farming. Now, Kashinath, and around 23 million other low- to middle-income Indians are being courted by a government scheme to boost investment in local stock markets.
The recently introduced Rajiv Gandhi Equity Savings Scheme (RGESS) - named after a popular prime minister who was assassinated in 1991 - offers Indian investors earning less than 1 million rupees ($18,600) a year a 50 percent tax break on stock investments of up to 50,000 rupees.
Kashinath, though, thinks the plan has as much chance of flying as the Australian birds he bought into.
I can't even read or write. How do you expect me to buy stocks that I don't understand? My money is stuck, but once I get it back, I'll open a bank account to keep it safe, he told Reuters by telephone.
The ambitious scheme, which aims to broaden share ownership, re-energise an unprofitable mutual fund industry and bring some structure to a patchy investment landscape, faces formidable barriers - not least India's love affair with gold.
India has one of the world's highest savings rates, at over 30 percent - more than double the United States - and the bulk of the nation's $800 billion in savings is parked in gold. India is the world's biggest gold buyer and holds $1 trillion worth of the precious metal,
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