Kuldip Maity

 For the last week or so, all we seem to have been discussing is the heatwave. It has gone beyond discomfort to the point where many feel ill when venturing outdoors. Even indoors, there is no respite from the heat (unless you are in air-conditioned comfort).

But this year is no different.

In recent years, discussions about rising summer temperatures have become increasingly common. People often debate whether summers are genuinely becoming hotter or if this is just a perception influenced by various factors.

First, let us acknowledge the scientific data regarding global temperature trends. Over the past century, there has been an obvious rise in average global temperatures, primarily attributed to human activities. Global warming is real and has undoubtedly impacted weather patterns, including the intensity and duration of summer heatwaves.

Statistical analyses conducted by climate scientists reveal a clear pattern of increasing temperatures across many regions. These findings are supported by data collected from weather stations, satellites, and other monitoring systems. Therefore, there is empirical evidence to suggest that summers are indeed getting hotter on a global scale.

However, subjective influences in our lifestyle can also influence our perception of summer heat. Humans are inherently sensitive to temperature changes, and various psychological and contextual elements can affect how we perceive heat. For instance, humidity and wind speed intensify the feeling of heat, even if the actual temperature hasn't increased much.

The urban heat island effect significantly contributes to the perception that cities feel warmer than rural areas. Concrete, asphalt, and buildings in urban environments absorb and retain heat, creating microclimates that can feel several degrees hotter than surrounding regions. As urbanization expands, more people experience this amplified sensation of summer heat, contributing to the perception that summers are becoming hotter.

Add to this the changes in our lifestyle. Air conditioners have become common in every household, making us more accustomed to comfortable temperatures throughout the day. The abrupt change in surrounding temperature also affects our perception when we venture out to non-air-conditioned areas.

Surprisingly, social media also influences our perception of summer heat. With heightened awareness of climate change and its effects, increased attention is given to extreme weather events and their implications. As a result, people may be more inclined to attribute even a slightly hot summer to broader climate trends, further reinforcing the perception of rising temperatures.

On this note, I would like to bring up the issue of planting trees. If one-tenth of the people asking others to plant trees on social media had planted a tree themselves, we would have had a much greener environment. Secondly, planting saplings should not be only regarded as a photo opportunity. We should all take proper care of the sapling to ensure it grows into a tree.

Returning to whether summers are getting hotter or just feeling hotter, we need a multifaceted approach that considers both objective data and subjective experiences.  Understanding the complexities is crucial for addressing the challenges posed by rising temperatures and mitigating their impact on human health and the environment.

A blanket statement about summers getting hotter may not apply universally and requires a nuanced understanding of regional climate.

 

 

Subho Noboborsho. This week, we started with the Bengali New Year. The Bengali calendar year 1431 corresponds to April 14, 2024, to April 14, 2025, in the Gregorian calendar. The Bengali calendar, also called Bangabda or Bangla Son, is a lunisolar calendar with 12 months. 

‘Pohela Boishakh,’ as it is normally called in Bangla, holds immense significance in the business world in the Bengali-majority regions of India. This day is celebrated with great enthusiasm and festivity. While traditionally a time for cultural and social gatherings, Pohela Boishakh also influences the business landscape, especially the MSMEs of the region, in several ways.

Pohela Boishakh is not just a cultural event but also a crucial occasion for businesses to boost sales and revenue. In the weeks leading up to the festival, markets and shopping centers experience a surge in activity as people shop for new clothes, gifts, and festive items. The ‘Chaitra Sale,’ offering discounts on traditional and modern fashion wear, further boosts the demand for clothing. As people prepare to celebrate the New Year, businesses related to accessories, jewelry, home decor, and electronics also show a significant upswing.

Like every festival, businesses launch marketing campaigns and promotional activities to leverage the festive spirit to attract customers with special discounts, offers, and festive-themed advertisements. Brands across various industries capitalize on the cultural significance of the occasion to enhance brand visibility and engagement. 

The ‘Halkhata’ ritual, a traditional custom observed by businesses at the start of the Bengali New Year, holds immense cultural and religious significance. It symbolizes a fresh start and the beginning of a new financial year, reflecting how traditional businesses used to close their financial books for the previous year and start anew. The ritual, often conducted on the first day of the Bengali calendar year, coincides with the festive occasion of Pohela Boishakh.

Haal Khata, which translates to "opening the new book," often adorned with auspicious symbols and colorful decorations, symbolizes a clean slate and the beginning of a new financial year. The ritual is conducted with great reverence and attention to detail, as it is believed to set the tone for prosperity and success in the coming year. The shop owner, dressed in traditional attire, sits at the counter or a designated shop area with the new account books placed before them. Customers and well-wishers are invited to participate in the ceremony, symbolically inaugurating the new financial year by making the first purchase or transaction of the day. With the standardization of accounting norms across the country, the ritual no longer signifies financial accountability but fosters transparency and trust between the business and its customers.

Haal Khata is culturally and socially important, bringing together members of the community in a spirit of camaraderie and goodwill. It is a time for exchanging greetings, blessings, and good wishes for the New Year. Many businesses also organize cultural programs, musical performances, and feasts to celebrate the occasion with their customers and the local community. The ritual is a cherished tradition that embodies the spirit of renewal, prosperity, and community bonding. 

Though it might have lost its significance in the digital age, by observing this age-old custom, businesses reaffirm their commitment to financial integrity and accountability and strengthen their ties with customers and the broader community.

 

 

On many occasions, I am asked this question by owners of micro, small and medium enterprises (MSMEs): “Is it advisable for MSME businesses to diversify?” To me, this is an area of ambiguity, as it depends on the business, its founder, and its performance. 

For MSMEs operating with limited resources, diversification can strain finances, human capital, and infrastructure. The need to invest in a new category or venture can stretch thin the already constrained resources, potentially harming the core business operations.

MSMEs often thrive by specializing in niche markets or specific product categories. Diversification may dilute the focus on the original market segment, and diverting mental bandwidth and resources away from the core business may decrease efficiency and effectiveness.

However, we also need to remember that in diversification, a seasonal downturn in one market may be offset by steady sales in another. Diversification enhances the resilience of MSMEs by making them less vulnerable to economic downturns or industry-specific crises. A diversified portfolio can help cushion the impact of adverse events, ensuring the continuity of business operations even during challenging times. We saw this during the pandemic, especially the intermittent lockdowns.

From the brand perspective, introducing unrelated products or services under the same brand umbrella can dilute its identity and confuse customers. MSMEs may undermine the reputation they've built in their core market by associating with unrelated or inferior offerings. However, if planned well, introducing new products or expanding into new markets can reinforce the MSME brand presence and enhance its visibility. A diversified portfolio demonstrates innovation, adaptability, and a commitment to meeting diverse customer needs, thereby enhancing brand reputation and customer loyalty, which should positively affect revenue through cross-selling and upselling.

Markets are dynamic, with consumer preferences, technology, and regulatory landscapes constantly evolving. Diversification equips MSMEs with the agility to adapt to these changes effectively. It allows them to pivot their strategies, explore new business models, and capitalize on emerging opportunities, ensuring long-term sustainability and relevance in the market. However, we should also appreciate that managing diverse business interests adds complexity to operations. MSMEs may find it challenging to maintain standards, streamline processes, and ensure consistent customer satisfaction across multiple ventures. This complexity can hinder agility and responsiveness to market dynamics.

MSMEs can spread their risk across multiple sectors or customer segments by diversifying their business categories or entering new markets. This may reduce the dependency on a single source of revenue and provide a buffer against market disruptions. One may argue that venturing into new markets or product categories exposes MSMEs to additional market risks. These risks include demand fluctuations, regulatory changes, and competitive pressures. Unlike larger corporations with greater financial buffers, MSMEs may struggle to weather adverse market conditions in multiple sectors simultaneously.

As I said earlier, there is no fixed rule.

 This is my first blog in the financial year 2024-25, and I wanted to write about my expectations for the next 12 months. 

As with every election year, this year starts with uncertainty. However, I am sure the country will reach a consensus for the general good. Hence, we should expect renewed positivity in business.

In its latest South Asia Development Update, the World Bank has projected robust growth of 6.0 percent for the region, driven predominantly by India’s strong economic performance. India has been regarded as the region’s economic powerhouse. This growth is largely attributed to the resilience of the services and industrial sectors. Even Morgan Stanley is bullish about the Indian economy, raising its GDP growth forecast to 6.8 percent for 2024-25 from 6.5 percent estimated earlier.

Market experts say FY24 was an outstanding year for the Indian stock markets. The BSE Sensex saw an incredible rise of about 24 percent, outperforming prior years’ performance and generating substantial wealth for investors. This growth outpaced many global counterparts, showcasing the market's resilience and strength. The predictions point to an optimistic trend into the fiscal year 2025, with volatility mostly triggered by events happening worldwide.

In my opinion, the digital payments ecosystem in India is well set for growth and will drive smartphone penetration, internet connectivity, and digital transactions. Fintech innovations, including digital wallets, UPI payments, and contactless transactions, are expected to gain momentum, leading to greater financial inclusion and convenience for consumers. We can also expect the business growth of cyber security firms, which guard the fintech innovations.

ESG considerations will gain prominence in India's financial landscape. Investors increasingly prioritize sustainable and responsible practices, accelerating the adoption of green bonds, renewable energy projects, and socially responsible funds. As awareness of climate change and social issues grows, ESG investing will likely become mainstream during the financial year.

However, will all be as positive as we expect? I am curious to see how inflationary pressures drive policymakers' monetary decisions. Rising commodity prices, supply chain disruptions, and geopolitical tensions may continue contributing to inflationary concerns, necessitating a cautious approach toward monetary policy. The Reserve Bank of India has a task ahead of itself to maintain a delicate balance between supporting economic growth and managing inflationary risks in the financial year 2024-2025, which I am sure will be handled as efficiently as we have witnessed in the past.

Summing up, the financial year 2024-2025 in India may witness various challenges and opportunities across various sectors. Proactive policies, innovative solutions, and resilient business models will drive inclusive and sustainable growth as the country navigates through economic recovery, digital transformation, and sustainability imperatives.