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This empirical exercise explores different aspects of the time‐varying linkage between the commodity and equity markets in India, focusing on base metal futures. The Dynamic Conditional Correlation model (2002) and Diebold–Yilmaz spillover index (2012) are employed to ascertain the presence, pattern, direction, and magnitude of the connectedness between the returns of base metal futures and related equity indices over the period of 2006–2019. The study builds on a less‐studied "input" channel of linkage between the two, reckoning with the economic fundamentals of demand–supply interaction. Our results show that 36% of the return forecast error variance originates from spillovers, to which the contribution of equity indices is minimal. It indicates segmentation between the two markets which offer the scope for potential diversification. Further, base metal futures are the net transmitters and equity indices are the net recipients of spillovers. Positive correlations outweigh the negative correlations, in both frequency and magnitude. [ABSTRACT FROM AUTHOR]

The study investigates the macro-economic determinants of foreign institutional investments (FIIs) in India by employing the Autoregressive Distributed Lag (ARDL) approach on the monthly data for the time period from April 2009 to December 2014. The macro-economic variables, which are based partially on portfolio balance model, include exchange rate, inflation, interest rate, domestic stock market performance, and foreign market performance. The results indicate that the exchange rate share a significant relationship with FII flows both in short run as well as long run. Along with, the presence of the positive and negative feedback trading can also be traced in Indian market for short run and long run, respectively. [ABSTRACT FROM AUTHOR]

In India, the proposed Direct Tax Code 2010 (DTC 2010 or Code) seeks to address the issues relating to tax avoidance and evasion by bringing in General Anti-Avoidance Rules (GAAR) in addition to various transaction-specific Special Anti-Avoidance provisions. The Discussion paper issued along with the proposed new tax code states that tax avoidance arrangements adopted by taxpayers span across several tax jurisdictions, and it is desirable to introduce GAAR that would serve as a deterrent to the use of increasingly sophisticated forms of tax avoidance by taxpayers. The paper also states that the appellate authorities and Courts have cast a heavy onus on the revenue authorities for dealing with matters of tax avoidance, especially when the relevant facts are in the exclusive knowledge of the taxpayer who chooses not to reveal them. Indian Government is trying to do some amendments to the Income Tax Act by introducing the General Anti-Avoidance Rules or GAAR. Most of the foreign investors investing in India by means of avoidance of tax rather than to do genuine business. So GAAR gives tax authorities a power to disregard such transactions and include the earning in the assesses income. The proposal of GAAR reintroduced uncertainty into Indian economic decision making, which frightened investors into believing that the economy had returned to the pre-liberalization period. [ABSTRACT FROM AUTHOR]