COVID-19 Daily Update - May 21

Karnataka reports 143 new cases, air fares are capped, railways is set to resume operations...and Furquan Moharkan speaks to Mrin Agarwal from Finsafe, to understand what the COVID-19 tax relief measures like the EPF and TDS deduction mean to the salaried class.
The daily update with Akhil Kadidal.
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Hello. This the daily COVID update from Deccan Herald. I’m Akhil.
On the bulletin today:
Karnataka reports 143 new cases, most continue to be from Maharashtra...after domestic air travel, the railways plans to resume operations soon....

And in our series of conversations tracking life after COVID, we speak to Mrin Aggarwal to see how personal finances can be brought back under control.
But first, a look at the daily figures

At the time of this recording, we’re still waiting for the figures from the states with high caseloads like Maharashtra, Tamil Nadu and Gujarat. Barring these states, India has over 64,000 active cases in the country right now and...
The ICMR has tested more than 26 lakh samples for the novel coronavirus so far and more than 1 lakh samples in the last 24 hours.

The number of COVID-19 patients needing critical care in the hospital has doubled in the last one month. In absolute numbers, the count of such seriously sick patients has increased by five fold according to a back-of-the-envelope calculation of the Govt data.
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Before we take a look at the figures from Karnataka, here are some key updates from the country...
After the government announced the resumption of domestic air travel, the air fare has been capped for a three month period. The pricing has been decided on the basis of flight duration, which is divided into seven sections. A Delhi-Mumbai flight ticket will be priced between 3,500 and 10,000 rupees for the next three months.
A Bengaluru - Mumbai flight will cost between 3000 - 9000 rupees, whereas a Bengaluru - Delhi flight is expected to cost between 4,500 - 13,000 rupees.
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The railways will also resume its normal operation soon. Sale of tickets at reservation counters will be started in 2 to 3 days. There is huge demand for tickets in 200 trains to be started on June 1 and the railways is struggling to get its online ticket.booking system up to speed.
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After MSMEs were given substantive relief to tide over the COVID-19 crisis, in the financial package announced by the Finance Minister, many other businesses are now requesting the government to be included in the medium and small sectors.
India’s seven crore strong traders, including wholesale, retail and others, have written to the Prime Minister for their inclusion in the MSME sector. The apparel export council has asked for a change in criteria, so that they can also be included under the MSMEs.
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Moving on to the numbers from Karnataka...143 new cases were reported from the state today, a surge from the 67 reported yesterday.
Most of those who tested positive today have a travel history to Maharashtra - and the 59 of these are from Mumbai alone.
Travel histories include Jharkhand, Rajasthan, Telangana, Tamil Nadu and the UAE.
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The highest number of cases have come in from Mandya, with 26 new cases, Udupi is a close second. All of Hassan’s 13 cases are from Maharashtra and Ballari’s 11 cases are from Mumbai.
The source of infection is being traced for 1 patient in Bengaluru and 1 in Mandya.

With this, the state has reported 1,605 cases in total of which 992 are active cases. 571 patients have recovered, while 41 have died. The state has tested more than 4000 samples in the last 24 hours.
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Moving on to a few updates from Karnataka, the state government has clarified that marriages that were previously scheduled to be held on May 24 and May 31 - Sundays - will be exempted from the total lockdown under Lockdown 4.0. The government issued this clarification following petitions by citizens who wanted to know if they could go ahead with marriages that were scheduled on Sundays.
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Although the new guidelines from the MHA, have not made the use of Arogya Setu compulsory, in Karnataka - the medical education Minister, Dr K Sudhakar, has made the use of the app mandatory for government employees. According to the minister, the app has to be downloaded by all, from the gram panchayat level to those working in the Secretariat.
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For many of us, the lockdown and the pandemic have been life changing events. Almost everyone is going through a job crisis. And for those of us, who are still lucky to have a job or a stable source of income, taking care of personal finance becomes more important than ever.
In our series of conversation on life post COVID-19, my colleague Furquan Moharkan explores some of the best investment options available and also what the recent TDS and EPF cuts mean to most salaried people.
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Furquan Moharkan:
It's been 50 days of the lockdown already to battle the Coronavirus pandamic. And in in this time period, the incomes of 84% of the households have come down. So this change the dynamics of how we use to look at the personal finance in the pre COVID world. To discuss all this we have with us Mrin Aggarwal, founder of Finsafe India, thanks Mrin for joining us.

FM:
So how do you see the personal finance space stepping up in this post lockdown world where we've seen people's incomes being reduced either fully or partially?

Mrin Aggarwal:
The COVID situation has really shown people that anything can happen at any point in time and hence, it's really really important, you know, to focus on financial security. One of the things that they really need to start focusing on is getting back to basics. And figuring out having six to 12 months of expenses kept aside as emergency cash having the right amount of medical and life insurance coverage.

FM:
Moving on, the one of the biggest things that we have seen in the past month in April, after the march mayhem whatever happened, the equity markets have tried to stabilize a bit and they are in the green most of the time. But another particular thing that has been observed is the group of investors in the COVID lockdown period. So what are the do's and don'ts in the equity market investing right now in such a scenario when macros are not looking good.
MA:
So it's surprising that the number of demat accounts have gone up so much. And it shows that these are the new investors who are coming into equities. And I would not say that, you know, jumping into buying stocks and trading stocks is the right way to go about it. Because again, as an individual investor, you know, what knowledge do you have in terms of what is the right stock to buy, or the Right Sector to get into, and yes while it's a good time to certainly invest your money because you're getting things cheap, cheaper than what they were probably at the beginning of the year, is there a financial goal that they want to fulfill with this? I would actually say start with a mutual fund. Start with a multicap equity fund rather than just you know, going and buying a couple of stocks and trading on that.

FM:
So the another thing that has been picking up in the markets, especially is the gold ETFs.

MA:
So as far as gold is concerned, I mean, the gold ETF is fine. I think even the sovereign Gold Bond scheme is fine. But the question to really ask is that do we need to own more gold because, as you know, as Indian families, we all hold a lot of gold in physical form right, in form of jewelry, and typically, it's not recommended to have more than 10% of your portfolio in gold. I'm sure a lot of Indian families have more than that. So given that again, and given the way the gold prices have moved, I'm not sure it's a great idea to to have invested right now in a gold ETF but yes, if you still want to invest in gold, the gold ETF is good and the sovereign Gold Bond scheme is also a good investment.

FM:
Moving on to the last but the most important question of the day, the government recently announced some COVID related measures. The first one was the reduction in the TDS for the salaried class and the second one was the reduction in the EPF contribution. So how does it impact the long term and short term savings of our viewers?

MA:
So if we were to take up the TDS first, TDS is tax deduction at source. Um, as you may be knowing that on fixed deposits, if your interest is above 40,000 rupees a year, there's a TDs of 10%. Now that TDS rate has been cut from 10% to seven and a half percent. What this means is that right now, the amount that's going to be deducted is going to be lower, which means that you will have a higher amount of cash in your hand, right? So if your deposit has matured, the amount of TDS it's going to get deducted is going to be lower, which means that you will have a higher amount of liquidity with you at this point in time, but it does not mean that you don't have to pay the tax you still have to pay tax on the interest earned on the fixed deposit or on dividends received from mutual funds, right. The second part of it, which is the employee provident fund, they have basically mandated that for the next three months, the employee provident fund deduction of for an employee is going to go down from 12% to 10%. So the extra 2% is again liquidity there in the hands of the employee. But remember that since this is going to mean an extra amount in your take take-home income, it's going to be taxable, right. Again, you know, looking at the amount it does not look as if it's really going to be helpful to many people, because, you know, if somebody is at a 50,000 rupees, basic thousand rupees per month more now, I'm not too sure what you can achieve with that sort of money. The second point is that the employer contribution is also going to come down. And what this really means is on a longer term basis, the compounding that you achieve through the employee provident fund is going to be lower than what it would have been if the 12% was getting deducted by both employer and employee.
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Back to the basics as Mrin said, might be a good way to make a fresh start...
That's all from us today. For the latest updates, log on to deccanherald.com. Stay safe and we’ll see you tomorrow.