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By:

Kaustubh Kale

10 September 2024 at 6:07:15 pm

Akshay Tritiya and Gold

As Akshay Tritiya arrives, gold once again takes centre stage in Indian households. For generations, buying gold on this auspicious day has been considered a symbol of prosperity, purity, and good fortune. It is not just a purchase. It is an emotion, a blessing, and a tradition passed from one generation to another. But beyond tradition, gold also carries an important financial lesson. Gold is not just jewellery. It is an asset. Gold During Uncertain Times Over the years, gold has proved its...

Akshay Tritiya and Gold

As Akshay Tritiya arrives, gold once again takes centre stage in Indian households. For generations, buying gold on this auspicious day has been considered a symbol of prosperity, purity, and good fortune. It is not just a purchase. It is an emotion, a blessing, and a tradition passed from one generation to another. But beyond tradition, gold also carries an important financial lesson. Gold is not just jewellery. It is an asset. Gold During Uncertain Times Over the years, gold has proved its worth not only during festivals, but also during uncertain times. Whenever the world faces wars, inflation, currency weakness, economic slowdown, or financial panic, investors across the globe look at gold as a safe haven. This is because gold has a unique quality. It is trusted across countries, cultures, and generations. It does not depend on the promise of one government, one company, or one currency. Why Gold Holds Value Unlike paper currency, gold cannot be printed endlessly. Unlike businesses, it does not depend on profits or management quality. Unlike real estate, it is globally accepted and easily valued. This is why gold continues to remain one of the oldest and most respected stores of value. It has survived centuries of change, economic cycles, wars, and financial crises. The Right Role in Your Portfolio That said, gold should not be treated as a shortcut to wealth creation. Equities and equity mutual funds still remain essential for long-term growth. Gold plays a different role. It brings balance, stability, and protection to your portfolio. When equity markets are volatile or global uncertainty rises, gold often provides comfort. A sensible allocation of around 10-20% to gold can help reduce overall portfolio risk.  So basically, while stocks and equity mutual funds play the lead role in your long-term financial goals, gold plays the supporting but essential role. Physical Gold Has Limitations However, the way you invest in gold matters. Buying physical gold during festivals may feel emotionally satisfying, but it comes with practical challenges. There are making charges, purity concerns, storage issues, risk of theft, and liquidity problems. A necklace may be beautiful, but you cannot easily sell only a small portion of it when you need money. Also, when gold is bought as jewellery, the investor often forgets to calculate the actual return after making charges and deductions. Smarter Ways to Invest This is where Gold Mutual Funds and Gold ETFs become useful. They allow you to invest in gold without worrying about lockers, purity, theft, or storage. You can invest flexible amounts, start SIPs, track value easily, and redeem conveniently when required. For investors who want gold as part of their financial plan, these options are far more practical than buying jewellery purely as an investment. Tradition with Financial Clarity Akshay Tritiya is a beautiful reminder that wealth should be built with faith, patience, and clarity. Buying gold is auspicious, but buying it in the right form is financially wise. This Akshay Tritiya, celebrate tradition - but also upgrade your financial thinking. Because true prosperity is not just about owning gold. It is about owning it smartly. (The writer is a Chartered Accountant and CFA (USA). Financial Advisor. Views personal. He could be reached on 9833133605.)

Is Pakistan’s War Rhetoric a Distraction or a Dangerous Reality?

Updated: Oct 22, 2024

South Asia teeters on the edge of another potential conflict, as the threat of war between nuclear-armed neighbors, Pakistan and India, looms. In a recent UN speech, Pakistan’s PM Shehbaz Sharif addressed terrorism, climate change, and conflicts in Palestine and Kashmir. While his words resonated, many question if this is a genuine concern or a distraction from domestic issues.

Sharif’s speech highlighted global conflicts, terrorism threats, and the devastating impacts of climate change. He warned of a ‘new Cold War,’ referencing U.S.-China tensions and Pakistan-India hostilities. These long-time adversaries have shaped South Asia’s political and security dynamics.

The Prime Minister made an emotional plea over Gaza, calling for action. He stressed the need for an immediate two-state solution based on pre-1967 borders, with full United Nations membership for Palestine. Without such a resolution, Sharif warned, the Middle East could be dragged into a war with consequences far beyond anyone’s imagination.

Sharif’s pivot from Palestine to Kashmir while drawing a direct comparison between the Palestinian struggle and the ongoing conflict in Jammu & Kashmir. Sharif described the plight of the Kashmiri people as a parallel tragedy, and their century-long struggle for self-determination, casting India as the aggressor in the region.

Since India revoked Jammu & Kashmir’s special status in August 2019, tensions have escalated. Sharif accused the Indian government of taking “unilateral illegal steps” in the region and implementing a “Final Solution” for Kashmir, invoking chilling echoes of the Holocaust. He went on to detail the presence of 900,000 Indian troops in the region, accusing them of terrorising the population with curfews, extrajudicial killings, and mass abductions of young Kashmiris.

His warning was clear: Pakistan would respond if provoked by India. “Pakistan will respond most decisively to any Indian aggression,” he stated, signalling that his government views the situation as a ticking time bomb. However, as he spoke of defending Kashmiri’s rights and resisting Indian aggression, many observers questioned the timing and the intensity of his rhetoric. With Pakistan grappling with severe domestic challenges, was this speech a way to rally nationalist sentiment and distract from his government’s failures?

To understand the implications of Sharif’s address, one must consider the situation in Pakistan. The country faces an economic crisis with record-high inflation, soaring unemployment, and mounting debt. The floods two years ago worsened matters, causing over $30 billion in damages and displacing millions. Though Pakistan contributes less than 1% to global emissions, it has suffered disproportionately from climate change. Sharif underscored this imbalance, stating, “We must uphold the axiom: the polluter pays!”

Sharif’s government is also facing mounting political pressure from opposition parties, particularly Imran Khan’s Pakistan Tehreek-e-Insaf (PTI), who have been vocal in their criticism of the government’s handling of the economy and its failure to address the needs of ordinary citizens. Protests have erupted, with demonstrators calling for better governance and accountability. In this context, Sharif’s strong rhetoric on Kashmir and India could be a strategic effort to shift focus from domestic crises. By portraying India as the aggressor, Sharif may be rallying for national unity and undermining his political opponents.

Sharif’s speech, while politically useful at home, poses serious risks. South Asia is a conflict hotspot, and a war between nuclear-armed Pakistan and India would be catastrophic. Even a limited conflict could escalate dangerously. Under Prime Minister Modi, India treats Kashmir as a domestic issue while continuing to modernise its military, likely to counter Pakistan.

This arms race is escalating between the two countries, and the dangers are clear. A single spark could ignite a conflict neither side truly wants but may feel compelled to fight. The international community has remained on the sidelines, unwilling or unable to mediate. Strategic alliances—Pakistan with China and India with the United States—further complicate the situation. Any conflict between the two would destabilise South Asia and risk drawing in these external powers, with unpredictable and far-reaching consequences.

Sharif’s speech raises an important question: is this political theatre, or is it a warning of impending conflict? It is likely somewhere in the middle. While Sharif’s government faces domestic pressure, his concerns about Kashmir and India’s military expansion are valid. The situation in South Asia remains fragile, with the risks of escalation and a catastrophic conflict ever-present.

The international community must act swiftly to de-escalate tensions between Pakistan and India, as the stakes are too high to ignore. Both nations have much to lose in another conflict, but neither seems prepared to back down. Amid global challenges like climate change and rising geopolitical tensions, nuclear-armed confrontation in South Asia is the last thing the world needs.

While Sharif’s speech may serve political aims, tensions between Islamabad and New Delhi are real, the risk of conflict remains, and global intervention is crucial.

(The writer is a senior journalist based in Islamabad. Views personal.)

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