NEWSLETTER, 20-IX-2015

INDEX of this NEWSLETTER

INDIA

- GENERAL POLICY, INFRASTRUCTURE, COUNTRY FINANCES, ETC.

• 1.1. 305 cities and towns identified for building houses for urban poor under Housing for All scheme
• 1.2. Payments banks can unlock Rs.14 lakh crore ($200 bn) funds
• 2.1. Mormugao, Kolkata, Chidambaranar ports beat sector growth
• 2.2. Centre to build major port in Tamil Nadu at a cost of Rs.21,000 crore ($3.2 bn)
• 3.1. Tamil Nadu signs pacts for more than Rs.2 trillion ($30.2 bn)
• 4.1. Odisha unveils IPR 2015, to attract Rs.173,000 crore ($26.05 bn) investment
• 5.1. $250 billion opportunity to invest in renewables: Piyush Goyal

- AGRICULTURE, FISHING & RURAL DEVELOPMENT

• 6.1. Suresh Prabhu infuses life into railways with Rs.150,000 crore ($21 bn.) LIC loan
• 6.2. Prabhu advocates launching of zero accident mission
• 7.1. Gujarat to bring APMCs on e-market platform
• 7.2. Make in India: IFFCO launches joint venture with Mitsubishi Corp for manufacturing agrochemicals
• 8.1. Kellogg plans first R&D unit in India
• 8.2. Nestle to reduce dependence on Maggi, broaden portfolio
• 9.1. Telangana to spend Rs.81,000 crore (~$12 bn.) on irrigation projects
• 9.2. India Inc. commits Rs.30,000 crore ($4.5 bn.) investments in Tamil Nadu

- INDUSTRY, MANUFACTURE

• 10.1. Auto sector may generate $300 billion revenue by 2026, create 65 million jobs
• 10.2. Bosch opens fifth manufacturing plant in Karnataka
• 10.3. Mercedes Benz India begins local assembly of CLA, GLA
• 11.1. Reliance Defence ties up with UAE's ADSB to build warships
• 12.1. Foxconn boost for 'Make in India': Why Taiwan Inc.'s growing interests in India deserve attention
• 12.2. Cellphone makers to set up manufacturing hub in Andhra
• 12.3. Sony gets down to making in India
• 13.1. Cipla set to buy American business of Hetero Drugs for $550 million
• 13.2. GSK begins work on Greenfield pharma plant in Karnataka
• 14.1. India growth engine of Asia: GE chief
• 14.2. Air bag makers eye $2 billion opportunity in India

-          SERVICES (IT, R&D, Tourism, Healthcare, etc.)

• 15.1. Aricent to invest $500 M in next 3yrs in India
• 15.2. Ericsson introduces 5G mobile tech in India
• 16.1. For start-ups, India is most competitive, says Nandan Nilekani
• 16.2. Future belongs to innovative entrepreneurs: Jitendra Singh
• 17.1. Google lesson for India Inc.: Innovate or you’re toast
• 17.2. Google, Facebook, Cisco and others line up to fulfill Arvind Kejriwal's free Wi-Fi dream 
• 18.1. Biocon bets big on its biosimilars offering
• 18.2. Indian healthcare industry's demand for workforce to double to 7.4 million in 2022
• 19.1. Ola partners with DGR to make 60,000 ex-servicemen driver-entrepreneurs
• 19.2. Many innovations for new economies will come from here
• 20.1. IndiGo confirms order for 250 A320s
• 20.2. Airlines fly high on low fuel prices, travel growth
• 20.3. Carlson Rezidor plans 170 hotels in India in 5 years

INDIA & THE WORLD

• 21.1. GVK-run '108' emergency response services to be launched overseas
• 22.1. Russia selects Anil's company to make choppers
• 23.1. Citi looks at India to build banking applications for global market
• 24.1. Preferential Treatment by India to Least Developed Countries (LDCs) in Trade in Services in the WTO
• 24.2. India will give better returns on investments: Jaitley
• 25.1. NHAI global arm to build roads in Iran, Sri Lanka, Nepal and Bhutan

* * *

NEWSLETTER, 20-IX-2015

INDIA 

- GENERAL POLICY, INFRASTRUCTURE, COUNTRY FINANCE, ETC.

1.1. 305 cities and towns identified for building houses for urban poor under Housing for All scheme

Press Information Bureau | Aug. 31, 2015

New Delhi: MP-74 cities, Odisha-42, Rajasthan-40, Chattisgarh-36, Gujarat-30, Telangana-34, J&K-19, Kerala-15, Jharkhand-15. 15 States sign MoA with Centre agreeing to implement reforms to ensure success of the Scheme States agree to do away with Non-Agricultural Permissions and to ensure single-window approvals.

Shri Venkaiah Naidu welcomes convergence of Smart City, AMRUT and Housing Missions. Within two months of the launch of the Housing for All (Urban) Mission, 15 States have signed Memorandum of Agreement (MoA) with the Ministry of Housing & Urban Poverty Alleviation committing themselves to implement six mandatory reforms essential for making a success of the housing mission in urban areas.

305 cities and towns also have been identified in nine of these states for beginning construction of houses for the urban poor.

By signing the MoA, the States have taken up the responsibility of implementing the six reforms which include:

1. Doing away with the requirement of separate Non Agricultural Permission (NAP) in case land falls in the residential zone earmarked in the Master Plan of city or town;
2. Preparing or amending Master Plans earmarking land for Affordable Housing;
3. Putting in place a single-window-time bound clearance system for layout approvals and building permissions;
4. Doing away with approvals below certain built up area/ plot size in respect of Economically Weaker Sections and Low Income Groups;
5. Legislating or amending existing rent laws on the lines of the Model Tenancy Act circulated by the Ministry of HUPA ; and
6. To provide additional Floor Area Ratio (FAR)/Floor Space Index/Transferable Development Rights (TDR) and relax density norms, for slum redevelopment and low cost housing.

States that have agreed to implement the above reforms include: Andhra Pradesh, Bihar, Chattisgarh, Gujarat, Jammu & Kashmir, Jharkhand, Kerala, Madhya Pradesh, Manipur, Mizoram, Nagaland, Odisha, Rajasthan, Telangana and Uttarakhand.

305 cities and towns in nine of these states have been identified for building houses for urban poor. These include: – Chattisgarh (36 cities/towns), Gujarat (30), Jammu & Kashmir (19), Jharkhand (15), Kerala (15), Madhya Pradesh (74), Odisha (42), Rajasthan (40) and Telangana (34).

Under the Housing for All initiative of the Central Government, names as ‘Pradhan Mantri Awas Yojana and launched by the Prime Minister Shri Narendra Modi on June 25 this year’, 2 crore houses are targeted to be built for the poor in urban areas by the year 2022, coinciding with the 75 year of Independence.

Under this urban housing mission, central government will provide an assistance in the range of Rs.1.00 lakh to Rs.2.30 lakh per house under different components of the Scheme including In-situ redevelopment of slums using land as resource, Credit linked Subsidy Scheme, Affordable Housing in Partnership and Beneficiary led individual construction/improvement.

With the announcement of lists under Smart City Mission, AMRUT and Housing for All, there has been a clear convergence of implementation of the three schemes.

The 9 states that have identified 305 cities for housing for urban poor, also account for 26 smart cities and 136 AMRUT cities. Of these, smart city mission, AMRUT and Housing Missions will be implemented in 25 smart city aspirants enabling convergence of schemes and resources of State and Central governments.

In 136 AMRUT cities, housing projects will also be undertaken. In case of Telangana, both the smart city aspirants of Greater Hyderabad Municipal Corporations and Warangal, AMRUT and Housing missions will be implemented. Similarly, in other AMRUT cities of Adilabad, Karimnagar, Khammam, Mahaboobabad, Miryalaguda, Nalgonada, Nizamabad and Suryapet, Housing for All mission will be implemented resulting in convergence.

Minister of Urban Development and Housing & Urban Poverty Alleviation Shri M. Venkaiah Naidu has welcomed this convergence. He said: “This convergence of urban schemes helps in better utilization of resources resulting in visible improvement in urban areas. I am glad that state governments are resorting to convergence based approach as intended by the central government.”

Details of cities and towns identified for starting construction of houses for urban poor so far are as below:

S.No. State Cities/towns identified:

1. Chattisgarh (36) - Ahiwara, Ambikapur,Bade Bacheli, Bagbahara, Baikuntpur, Balod, Baloda Bazar, Bhatapara, Bhilai Charoda, Bhilai Nagar, Bijapur, Bilaspur, Birgaon, Champa, Chimiri, Dantewada, Dhamtari, Durg, Gobra Nawapara, Jagdalpur, Jashpurnagar, Kanker, Kawarda, Kondagaon, Korba, Mahasamund, Mana-camp, Mahendragarh, Mungeli, Naila-janjgir, Narayanpur, Pendra, Raigarh, Raipur, Rajnandgaon, Sukma.
2. Gujarat (30) - Ahmedabad, Amreil, Anand, Ankleswar, Bharuch, Bhavnagar, Bhuj, Deesa, Gandhidham, Gandhinagar, Himatnagar, Jetpur, Kadi, Kalol, Mehsana, Morbi, Navsari, Palanpur, Patan, Rajkot, Savarkundla, Sidhpur, Surat, Una, Unjha, Vadodar, Vallabh Vidyanagar, Valsad, Vapi, Visnagar.
3. J&K (19) - Anatnag, Badgam, Baramullah, Bashohli, Bhaderwah, Bijbehara, Doda, Ganderbal, Jammu, kargil, Kathua, Pulwama, Punch, Rajouri, Samba, Shupiyan, Sopore, Srinagar, Udhampur.
4. Jharkhand (15) - Bokaro, Chas, Chirkunda, Deogarh, Dhanbad, Dumka, Giridhi, Gumla, Hazaribagh, Jamshedpur, Lohardaga, Medininagar, Phusro, Ramgarh Cantonment, Ranchi.
5. Kerala (15) - Alappuzha, Kalpetta, Kannur, Kasargod, Kochi, Kollam, Kottayam, Kozhikode, Palakkad, athanamthitta, Thiruvananthapuram, Thodurpuzha, Thrikakara, Thrissur. 
6. MP (74) - Agar, Alirajpur, Anupur, Ashoknagar, Astha, Balaghat, Barwani, Berasia, Betul, Bhind, Bhopal, Bina-Etawa, Budni, Burhanpur, Chandla, Chattarpur, Chindwara, Dabra, Damoh, Datia, Dewas, Dhar, Dindori, Ganj Basauda, Guna, Gwalior, Hasda, Hoshangabad, Indore, Itarsi, Jabalpur, Jhabua, Khajuraho, Khandwa, Khargone, Khurai, Maihar, Manawar, Mandla, Mandsaur, Morena, Murwara(Katni), Nagda, Narsimhapur, Nasrullaganj, Neemuch, Panna, Patharia, Pithampur, Raisen, Raigarh, Rampur Baghelan, Ratlam, Rehti, Rewa, Sagar, Sarni, Satna, Sehore, Sendhwa, Seoni, Shadol, Shahganj, Shajapur, Sheopur, Shivpuri, Sidhi, Sihora, Singrauli, Sonkatch,Tikamgarh,Ujjain, Umaria, Vidisha. 
7. Odisha (42) - Anandpur, Athagad, Bolangir, Baleshwar, Banapur, Banki, Bargarh,Baripada, Bhadrak, Bhawanipatna, Bhubaneswar, Biramitrapur, Barhampur, Brajrajnagar, Byasanagar, Choudwar, Cuttack, Debagarh, Dhenkanal, Jagatsinghpur, Jajpur, Jeypore, Jharsuguda, Kantabanji, Khariar, Khurda, Kochinda,  Konark,  Koraput,  Malkangiri,  Nayagarh, Paradip, Puri, Rajrangpur, Rajagangapur, Rourkela, Rayagada, Sambalpur, Sundargarh, Talcher, Titlagarh, Umarkote. 
8. Rajasthan (40) - Ajmer, Alwar, Balotra, Banswara, Baran, Beawar, Bharatpur, Bhilwara, Bhiwadi, Bikaner, Bundi, Chaksu, Chittorgarh, Churu, Dhaulpur, Falna, Ganganagar, Gangapur City, Hanumangarh, Hindaun, Jaipur, Jhalawar, Jhunjhunu, Jodhpur, Kishangarh, Kota, Makrana, Nagaur, Nathdwara, Pali, Pratapgarh, Pushkar, Rajsamund, Sardarshahar, Sawai Madhipur, Sikar, Sujangarh, Tonk, Udaipur, Vijainagar. 
9. Telangana (34) - Achampet, Adilabad, Armur, Bhongir, Bodhan, Dubbaka, Gajwel, Greater Hyderabad Municipal Corporation, Husnabad, Huzurabad, Jammikunta, Jangaon, Karimnagar, Kollapur, Khammam, Mahaboobabad, Mahaboobnagar, Medak, Metpalle, Miryalaguda, Nagarkurnool, Nalgonda, Nirmal, Nizamabad, Palwancha, Sangareddy, Shadnagar, Siddipeta, Sircilla, Suryapeta, Vicarabad, Wanaparty, Warangal, Zahirabad. 

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

1.2. Payments banks can unlock Rs.14 lakh crore ($200 bn.) funds

HT Business | Aug. 31, 2015

New Delhi: With the setting up of 11 new payments banks in the country, an incremental amount of at least Rs.14 lakh crore per annum may be freed up for funding the infrastructure sector, an internal study by the State Bank of India (SBI) said.

The report said that at present people hold a significant amount of cash with them for their day-to-day transactions. “It is expected that the payment banks will accelerate India’s journey to a cashless economy. In a simple arithmetic, even if the cash with public gets reduced by 1%, this will increase the deposit base of banks by around Rs.15 lakh crore,” the report revealed.

The payments banks would not offer full banking services and confine its operations to acceptance of deposits, remittance services and other specified services. They have also been allowed to hold a maximum deposit of Rs.1 lakh per customer in the initial phase.

At present, the outstanding deposit of small banks in India is about Rs.1 lakh crore. The report said that if each payments bank mobilises one fourth of such deposits in a year, with an assumption of a penetration rate of 25% and given that the Jan Dhan Yojana mobilisation is around Rs.20,000 crore in a year, 11 payment banks would thus mobilise around Rs.2.75 lakh crore.

“Given that payments banks can only invest in government securities, this entire amount will thus be freed up for credit needs towards the infrastructure sector,” Soumya Kanti Ghosh, chief economic adviser, SBI told HT.

Ghosh also said that the payments bank model will primarily run on digital mode and given that the credit profile and transaction history of customers will be easy to build, there is a huge opportunity for banks to unlock retail business potential.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

2.1. Mormugao, Kolkata, Chidambaranar ports beat sector growth

Business Standard | Aug. 17, 2015

New Delhi: While 12 major ports in the country witnessed a year-on-year growth of six per cent in traffic during April to July, three, namely, Kolkata, VO Chidambaranar (Tamil Nadu), and Mormugao (Goa) port trusts outpaced the sector, registering more than 20 per cent growth, according to Indian Ports Association.

In the past financial year, too, these three ports had outpaced the sector.

Chidambaranar registered the highest growth of more than 27 per cent, followed by Mormugao (23.5 per cent), and Kolkata (23 per cent). Analysts say these ports achieved better growth during April to July compared to the corresponding period a year ago on the back of domestic requirements for thermal coal for the power sector, coking coal, and increase in container movement.

These 12 major ports handled 202 million tonnes (mt) during April to July, compared to 191 mt during the corresponding period a year ago. R P S Kahlon, chairman, Kolkata Port Trust, said, "There were many reasons behind our growth. We did aggressive marketing for our port and at the same time we improved our evacuation and connectivity facility. In addition, we maintained a draft of 7.5 to eight metres during the period compared to 7.5 metres a year ago. This has resulted in attracting many vessels, since an extra draft of 0.1 metre can accommodate 650 tonnes of additional cargo."

The Kolkata Port Trust has reported a 23 per cent growth in traffic to 16.8 mt during April to July against 13.7 mt during the corresponding period a year ago. In the past year, it registered a growth of 12 per cent against the sector growth of 4.65 per cent.

According to the data:

1. The Kolkata Dock System handled an increase of 15.3 per cent in traffic at 5.2 mt compared to 4.5 mt a year ago. The Haldia Dock Complex reported a 26.7 per cent growth in cargo at 11.6 mt during the period.
2. Chidambaranar handled 13 mt during the period compared to 10.2 mt during the corresponding period of the past year. Mormugao Port Trust handled 5.4 mt in April to July, compared to 4.4 mt a year ago.
3. Cyril C George, acting chairman & deputy chairman, Mormugao Port Trust, said, "After the iron-ore ban, we put our effort in attracting other cargo. At the same time, we improved our evacuation facility for coal. Our effort helped us attract new cargo such as bauxite and granite, in addition to coal."
4. April to July, traffic in New Mangalore Port Trust fell 5.83 per cent and in Vishakapatnam Port Trust it fell 10.5 per cent.
5. Kamarajar Port (formerly Ennore Port) registered a 10.5 per cent increase in traffic.
6. Jawaharlal Nehru and Vishakapatnam port trusts registered less than the sector average growth.

According to ICRA, major ports in the country are likely to achieve better growth in the current financial year compared to a year ago. The 12 major ports in the country registered a modest growth of 4.7 per cent in cargo to 581 mt in FY15, on account of weaker cargo performance.

K Ravichandran, senior vice-president and co-head, corporate ratings, ICRA, said, "In the past financial year, the growth at major ports was down, due to continuing mining restrictions in major states such as Karnataka, Goa, and Odisha, and other policy measures such as imposition of export duty. Apart from the petroleum oil and lubricants segment, all other cargo categories, including containers, fertilizers, coal and others showed growth in volumes at major ports."

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

2.2. Centre to build major port in Tamil Nadu at a cost of Rs.21,000 crore ($3.2bn.)

PTI | Sep. 3, 2015

TN government gave the go ahead to the Centre for developing a major port at the southernmost tip of the state.

New Delhi: The Centre would soon build a major port at Colachel in the southernmost tip of Tamil Nadu at an estimated cost of Rs.21,000 crore, envisaged to emerge as a southern gateway of transhipment in the country.

Coming close on the heels of the Vizhinjam International Deepwater Multipurpose Seaport in Kerala to be developed by the Adani Group, about Rs.21,000 crore would be spent to establish the Colachel port at Kanyakumari district in neighbouring Tamil Nadu.

Briefing newspersons here, union minister of state for shipping Pon Radhakrishnan today said, government of Tamil Nadu has given its consent to the Centre to facilitate developing the port.

"A Special Purpose Vehicle (SPV) would be created for the purpose. The port would be developed in three phases and it would take three years for completing the construction," he said.

The minister, however, did not elaborate the roadmap as to whether the port would be built on Public Private Partnership (PPP) model and did not talk about the monetary contribution by the Union government in establishing it.

3.1. Tamil Nadu signs pacts for more than Rs.2 trillion ($30.2 bn.)

Livemint | Sep. 11, 2015

Chennai: Salvaging its reputation as an investment destination, the Tamil Nadu government signed investment agreements amounting to more than Rs.2 trillion during a two-day Global Investors Meet that ended on Thursday. The state, which makes three cars a minute, has set an ambitious target to become the world’s largest car manufacturing hub.

“I repeat with pride, the total amount of investments that have been finalized during the investors’ meet is an unprecedented Rs.2,42,160 crore,” chief minister J. Jayalalithaa told the valedictory event of the investors’ meet in Chennai. This was twice the investment targeted for the first edition of the event.

A total of 98 memoranda of understanding were signed. Companies such as SunEdison Inc., HCL Technologies Ltd, Cognizant Technology Solutions, ITC Ltd, Adani group, MRF Ltd and Delta India Electronics were among the signatories. “This exceeds the cumulative investment attracted by Tamil Nadu over a 20-year period from 1991 to 2011,” Jayalalithaa said.

Hype aside, Tamil Nadu has a troubled legacy of stalled ventures and infrastructure hurdles. Bad roads, congested ports and delayed approvals have dented the image of a state where foreign investors once flocked to set up automobile factories and technology offices.

In 2012, the state government entered into agreements with 12 companies for investments totalling more than Rs.20,000 crore. Of the lot, the major projects never saw the light of day - Indo Rama Synthetics Ltd.’s Rs.4,500 crore synthetic fibre and petrochemical manufacturing unit; BGR Energy and Hitachi Ltd.’s Rs.2,325 crore venture to make turbines, generators and boilers; US-based paint maker PPG Industries and Harsha Exito Engineering’s Rs.4,100 crore plant to manufacture fibre glass; and a 2,000-acre textile park in Coimbatore involving an investment of Rs.3,100 crore.

“The global investor meet is a political gimmick,’ said Gnani Sankaran, a political commentator.

“Delays in projects are a matter of concern,” said Jun Kuroki, general manager of Mizuho Bank Ltd, Chennai, at a session to improve infrastructure during the investors’ meet. Basic infrastructure like roads and waterways needed improvement, he added.

Of the agreements signed, investment proposals worth Rs.1.04 trillion are in the manufacturing sector. The energy sector adds up to Rs.1.07 trillion. Investments of Rs.16,533 crore have been proposed in micro and small enterprises, Rs.10,950 crore in information technology, Rs.1,955 crore in handloom and textiles, Rs.800 crore in agriculture and Rs.500 crore in fisheries.

Close to half the investment committed will go to the southern districts—Madurai, Tirunelveli, Tuticorin, Thanjavur and Kanyakumari. A big chunk will go into the development of the Madurai-Tuticorin industrial corridor and another large investment into setting up a liquefied natural gas terminal at Tuticorin.

Tamil Nadu is facing stiff competition from neighbouring states—Andhra Pradesh, Telangana and even Maharashtra—on attracting investment. Sri City in Andhra Pradesh has signed agreements worth Rs.18,000 crore with more than 100 companies in the last two years.

The Tamil Nadu government has promised single-window clearance within 30 days of the date of application for each of the investment proposals finalized on Thursday. Jayalalithaa said the state will not just be the most favoured destination in India; it will be among the top three destinations in Asia. A global investors’ meet will be held every two years, she added.

With six months to go for assembly elections in the state, the government wants to show that it means business, said Sankaran. “I wonder how many agreements that get signed during the investors meeting will actually happen at the ground level,” he added.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

4. Odisha unveils IPR 2015, to attract Rs.173,000 crore ($26.05bn.) investment

IBEF | Sep. 04, 2015

Bhubaneswar: Odisha Chief Minister Mr Naveen Patnaik unveiled the new Industrial Policy Resolution (IPR-2015), with a view to attract fresh investments of Rs.1,73,000 crore (US$ 26.05 billion) in next four years and provide direct employment to about 300,000 people.

The IPR-2015 aims to achieve the state government's target of increasing the share of manufacturing to 15 per cent of the gross state domestic product (GSDP).

Apart from mines and minerals, the policy would help in attracting new investments in manufacturing sector and make Odisha a destination for both domestic and international investors.

Some of the sectors under focus include chemicals (including petro-chemicals), IT/ITeS, plastics, electronics system design & manufacturing (ESDM), auto components ancillary, food processing, and textiles.

IPR-2015 also aims at providing employment-based incentives to the prospective investors. Other incentives include grants for investments in both Greenfield and brownfield infrastructure, subsidies in power tariff, training, capital investment and reimbursement of value added tax (VAT), stamp duty exemption and concessional land cost for investments in specific sectors.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

5. $250 billion opportunity to invest in renewables: Piyush Goyal

Livemint | Sep. 01, 2015

New Delhi: India has a $250 billion investment opportunity in the renewable energy space, said Piyush Goyal, minister of power, coal and renewable energy, at Mint’s fifth energy conclave in New Delhi on Friday. This includes the peripheral transmission and generation segments as well.

India plans to have 100,000 megawatts (MW) of solar energy capacity by 2022. The government has also set a target of generating 60,000MW from wind power by then. Renewable energy currently accounts for 13%, or 35,777MW, of the total installed capacity of 274,818MW.

India’s push to boost wind and solar power production provides opportunities for global companies that have been hit by the plunge in international crude oil prices. Lower oil prices can potentially derail, or at least delay, the world’s shift to wind and solar energy, as it makes less economic sense to tap costlier renewable energy sources.

Speaking at the event, Goyal said that in the next two to three years, India will not be dependent on coal imports except for coking coal. The Indian coal sector, with one of the five highest reserves in the world, today imports coal worth $20 billion a year, as domestic production lags demand—partly a function of the inefficiencies built up in the decades since nationalization.

“I would say not only for fuel but for equipment, technology, maintenance, servicing, innovation in the power sector, the coal sector and the renewable energy sector, except for coking coal, which is yet not explored adequately, I am confident that in the given three-four years, India will not have any import dependence at all,” he added.

He added that India has done exceedingly well in terms of equipment and on the solar energy side. “I don’t think we’ll have any more import dependence in terms of LEDs, energy efficiency, in terms of equipment for the cells and modules that is raw material. I’m quite sure given the huge impetus the industry is focusing on or the government is trying, we shall soon have more manufacturing companies coming to India,” he said.

Goyal said India will not have a single incandescent bulb in the country, and hopefully no CFLs (compact fluorescent lamps) either, in three years. “I am talking about three years replacing seven years, 770 million LED bulbs in people’s homes and just the program we are looking at will save 100 million units of energy consumption - that is 10,000 crore units of electricity, and the benefit goes straight into your pocket,” he added.

For India, the world’s biggest greenhouse gas emitter after the US and China, the emphasis on solar and wind power is also expected to strengthen its standing at global climate change negotiations that will culminate in a summit in Paris in December.

Goyal also reiterated that India has around 18,500 villages that are still to be electrified. “In 1,000 days, we will have a situation where all 597,000 villages will have energy access. We have allocated central funds for it,” he added.

He added that the government has taken a pledge to provide 24x7 power, which is the right of every citizen and will be taken up as a mission. “I assure that every household will get energy. Especially the eastern part of India has been deprived of their rights.

It has to be a shared responsibility that people staying in forests, tribal, villages in Uttar Pradesh and Bihar have access to these basic amenities. For any development, I believe it is important to have electricity. You can’t have huge investments and say wait, you’ll have to wait until electricity is made available to you,” Goyal said.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

- AGRICULTURE, FISHING and RURAL DEVELOPMENT

6.1. Suresh Prabhu infuses life into railways with Rs.150.000 crore ($21 bn.) LIC loan

ET Bureau | Sep. 2, 2015 |  By Bhavna Vij Aurora

New Delhi: The railways have finally identified the projects that will be funded by the Rs.1.5 lakh-crore loan that Life Insurance Corporation (LIC) has extended to the cash-strapped organization for the next five years.

Railway officials claim that the organization is under close scrutiny of Prime Minister Narendra Modi, who thinks that a robust railway can greatly contribute to the country's economy.

"He is personally reviewing the progress of critical railway projects and urging the ministry to hasten the speed of implementation," a senior Railway Board official told ET.

Initially struggling to identify projects to be funded by the LIC, the railways have now shortlisted 24 corridors for expansion and strengthening from the loan money.

The railways had signed a MoU with LIC in March to meet its capital requirement for network decongestion and expansion by 2019.

Railway officials say though there is "endless work" to be done in railways, it took them time to find projects for LIC since the insurer was keen to invest only in financially viable projects that earned a rate of return (RoR) of at least 14% every year.

"Since the priority of railway minister Suresh Prabhu is network decongestion, 24 congested corridors have been identified where LIC funds will be utilized. Most of the sections in the corridors will yield a high RoR, going as high as 48% like the Rajkharsawan-Sini section in the Howrah-Mumbai corridor," explained another official.

The identified corridors include the golden quadrilateral—Howrah-Chennai, Delhi-Howrah, Howrah-Mumbai, Delhi-Chennai, Chennai-Mumbai and Mumbai-Delhi.

In addition, some other corridors have been identified like the highly congested Amritsar-Ludhiana-Saharanpur-Moradabad-Lucknow-Sultanpur-Zafrabad- Mughalsarai-Varanasi route.

"The Mughalsarai section of Northern Railway is by far the worst section as far as congestion is concerned. It is over utilised by 150% of its capacity," the railway official said.

"The minister's priority was to pick choked corridors and decongest them by capacity augmentation. This is necessary for improving the safety of railway network too," he added.

The railways are confident that the work will be completed as per laid down timelines. "This is the first time that railways have assured funding for capacity enhancement projects. In the past, the problem has been lack of consistent funding. A few lakh or a couple of crores were earmarked for projects every year that needed a much higher sustained investment. So, the cost of project kept increasing and the deadline kept getting pushed," explained an official from engineering department dealing with projects.

An official spokesperson said that the minister was also tracking the projects closely using IT for online monitoring of the progress of the projects.

6.2. Prabhu advocates launching of zero accident mission

PTI | Aug. 29, 2015

New Delhi: Advocating "zero accident mission", Railway Minister Suresh Prabhu on Saturday asked other countries to make India their base for manufacturing as the government will be investing USD 120 billion over the next five years to develop the railway services.

Prabhu said the main thrust of any transport organisation should be on safe and secure transportation with zero scope for accidents and emphasized the need to launch "zero accident mission" with definite timeframe.

"World-wide focus on transportation is safety and it is for Indian Railways as well. It is most important for us to ensure safe travel with the help of latest technology," Prabhu said at an international seminar here.

The seminar on advances in command, control and communication system for main line, Metro and high speed transit systems was attended by many representatives of foreign nations including Japan, Korea, Russia, among others.

He said India has technological collaboration with many countries in rail sector.

Highlighting the scope of investment in rail sector, he said, "The government will be investing about USD 120 billion in the next five years in railways and the amount will be more in future."

Targeting investment from abroad, Prabhu said India has advantage of skilled man power, big market and large manufacturing base and in addition to internal consumptions such manufacturing hubs have export potential.

"There is a positive environment for make-in India. We would like to have partnership with other countries to make India as a manufacturing hub. Come and make your goods here and then export from here," he said.

7.1. Gujarat to bring APMCs on e-market platform

Business Standard | Sep. 16, 2015

Ahmedabad: From November, farmers here will be able to check stocks and buy or sell produce to those in Unjha at the click of a button, with Gujarat putting in place an electronic market platform for its Agricultural Produce Market Committees (APMCs), under the National Agriculture Market (NAM) initiative.

Initially, 26 of the 210 APMCs will be connected to the e-market platform. These include the APMCs in Ahmedabad, Rajkot, Bhavnagar, Himmatnagar, Unjha, Surat, Dahod and Gondal. “The total project cost is about Rs.21 crore.

To secure financial assistance, we have given a proposal to the central government,” said Mona Khandhar, secretary of the agriculture and cooperation department, Gujarat.

The state government plans to develop two types of markets under the e-market platform — a real-time market and a virtual one. “The local real-time market will see trading of smaller lots by local traders on the e-platform wherein traders will have some time to study before bidding. The virtual market will allow traders with valid licences from anywhere to trade in larger lots. During trading, laboratory results can also be shared on the lots,” Khandhar said.

Currently, traders can participate only in a single APMC for physical trading, though they can participate in multiple markets with a single licence in the in e-market. Under the current e-market model, trading can also be carried out with other states, through a prior agreement.

Mohanbhai Kundariya, Union minister of state for agriculture, said, “Our aim is to put all APMCs under one platform so that farmers can get better prices for their products. The Union government will provide all kinds of financial support to develop an e-market platform.”

The Gujarat government aims to bring at least 100 APMCs under the e-market platform by the end of March 2016. For this, the central government has allotted Rs.200 crore.

The 26 APMCs to be connected to the e-market platform initially will have modern grading and packaging facilities. The state government also plans to set up a laboratory for quality checks.

“We have issued a tender to identify a commodity exchange to be our partner for the e-market platform. We are studying numbers of such markets,” Khandhar said.

The state government plans to conduct a seminar for farmers, traders and APMC officials to explain to them the concept of an e-market.

The NAM model has been adopted from Karnataka, which has had an e-market since the past couple of years. Gujarat, however, might be the first state to implement the project directly under NAM.

The Gujarat government is planning to set up 100 warehouses for agricultural produce, for which Rs.5 crore has already been allotted. “The state government has decided to give priority to e-market-linked APMCs to set up warehouses in the next year,” said J G Pandya, director of the Gujarat State Agricultural Marketing Board.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

7.2. Make in India: IFFCO launches joint venture with Mitsubishi Corp for manufacturing agrochemicals

Times of India | Aug. 27, 2015

New Delhi: Fertilizer cooperative IFFCO on Wednesday formally launched a joint venture with Japanese firm Mitsubishi Corp for manufacturing agrochemicals in India that will start operation in this rabi season starting October.

IFFCO holds 51% stake and the rest is held by Mitsubishi in the joint venture IFFCO-MC Crop Science Private Ltd. The shareholding pact was signed last month.

"The company was formally launched today...The operations of this new JV will start from this rabi season. IFFCO-MC will come up with 20 different products across various product ranges of agrochemicals," IFFCO said. IFFCO said it is looking forward to have its own production units in India as a long term goal.

In a statement, the cooperative said that the logo of the JV firm was exchanged between IFFCO chairman Balvinder Singh Nakai and Mitsubishi Corporation India chairman and managing director Masakazu Sakakida.

Speaking on the development, IFFCO chairman said, "We were getting continuous demand from farmers across the country to make available good quality insecticides, fungicides and weedicides apart from quality fertilisers, which IFFCO is supplying through cooperative societies."

IFFCO managing director and CEO US Awasthi said, "With this foray into agrochemical business, IFFCO wishes to fulfil its commitment towards farming community and will enlarge its services especially to them and agricultural sector."

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

8.1. Kellogg plans first R&D unit in India

TNN | Aug. 17, 2015 | By Namrata Singh

Chennai: World's largest cereal maker, the $14.6-billion Kellogg Company, wants to triple the size of its Indian business. Kellogg India is a roughly Rs.800 crore company, contributing 10% to the parent's Asia-Pacific revenues, making the country its fastest growing market in the region. The plan is to take this contribution to 20% in five years.

Considering that Kellogg India is growing in double-digits, the Michigan-based parent is making large investments in manufacturing and also plans to set up its first R&D facility in the country at Taloja, near Mumbai.

Emerging markets like India are key to Kellogg Company, whose second quarter earnings fell 24% from a year ago, with persistent weakness in its core US cereal market.

After making an investment of $60 million in its second manufacturing plant at Sri City (Andhra Pradesh), Kellogg Company is already planning to set up a third cereal facility in India in 3-4 years. The company expects the demand to grow in the wake of changing breakfast habits in India.

In an exclusive interview to TOI, John Bryant, chairman & CEO, Kellogg Company, said: "In the last 12-18 months, we invested about $100 million in India, which gives the potential size of opportunity here."

Bryant said the cereal category in India is at an inflection point with consumers looking for healthier and convenient alternatives. "We had one cereal facility for the last 20 years and we have opened a second one, and expect that in three or four years, we should be opening our third one to accelerate our growth. In the next several years, we should triple the size of the business in India," he said.

With an R&D facility in India, Kellogg Company is looking to improve upon its technical capability to make products specifically for India. The idea behind promoting Indian innovations follows the success of flavoured oats, which hinged on the insight that Indian consumers have different taste preferences, which veer towards a savoury breakfast.

Kellogg India is often critiqued for the long time it took to reach the current size since it started operations in 1994. Over the last few years, however, the pace of growth has accelerated. India got noticed as an important market when Kellogg's global board met in Mumbai — the fourth venue after the US, the UK and Canada - two years back.

Bryant, who also interacted with consumers here - and learnt how their aspirations were largely pivoted around their children — said breakfast was the hardest part to change a habit. "Once you break into the habit, you have a wonderful opportunity to drive consumption."

Besides cereal, Kellogg is also keen on bringing its snacking brands, such as Pringles, to India, a market which currently does not truly reflect the global portfolio. Globally, Kellogg is the second largest maker of cookies, crackers and snacks.

"In the next several years, we could have a big footprint in snack as well as cereal. We could be much bigger in India across the entire portfolio," said Bryant.

Bryant's visit coincided with Nestle India being slapped with Rs.640-crore damages suit by the government. When asked whether Kellogg Company was worried about the turn of events around Maggi, which faced a ban in India, Bryant said: "We would never like to see a situation like this. We have a very strong programme and processes in place to absolutely safeguard on food."

Although he did not specifically comment on Maggi, Bryant said safety was a top priority for Kellogg Company globally, given that "every time our board of directors meets, I present on food safety".

8.2. Nestle to reduce dependence on Maggi, broaden portfolio

TNN | Aug. 15, 2015 | By John Sarkar

New Delhi: Following the Bombay high court verdict that lifted the nationwide ban on Maggi noodles, subject to fresh tests, Nestle said it will accelerate the process of expanding its portfolio in India as quickly as possible.

The Swiss food giant has often been criticized for banking too much on its bestseller Maggi. Nestle has a huge portfolio — from bottled water and ice creams to cereals and pet food.

In India, Maggi raked in nearly Rs.2,500 crore or one-fourth of its annual revenues. "We will certainly look for stronger consumer insights and see how we can accelerate the process of innovation and renovation to make our portfolio even more attractive for consumers," a Nestle India spokesperson told TOI.

Nestle India slipped into loss last month after its popular Maggi noodles was pulled off the shelves over safety concerns. Among the products it sells here are instant coffee (Nescafe and Sunrise), dairy products (Milkmaid and EveryDay), chocolates (KitKat and Munch) and many products under the Maggi brand.

"Strangely, Nestle has not been aggressive in India. They have such a phenomenal portfolio abroad. Hopefully, this time they will come back stronger and say, we can do much better. We need more companies like Levers and Nestle in India," said Arvind Singhal, founder of retail consultancy Technopak.

Abneesh Roy, associate director at Edelweiss Securities, said over the last three years, the Indian arm of the Swiss multinational did not witness volume growth. "Whatever growth Nestle India saw was due to price increases. In contrast to other markets, the company was too dependent on only one product in India. And, that is Maggi," he said.

Nestle India told TOI that its priority is to get Maggi back on the shelves. "It is Nestle India's endeavour to get Maggi Noodles back on the shelves as soon as possible for the benefit of our consumers and will continue to engage with the authorities," the spokesperson said.

9.1. Telangana to spend Rs.81,000 crore (~$12 bn.) on irrigation projects

Livemint | Sep. 03, 2015

Hyderabad: Telangana government on Wednesday said it will be spending Rs.81,000 crore (~$12 bn.) in next three years to complete pending irrigation projects and take up two new projects to lift water from the Godavari and Krishna rivers.

“We have completed the process of redesigning of all existing projects irrigation in Telangana, to benefit the state as much as possible,” said K. Chandrasekhar Rao, chief minister of Telangana.

Rao said the government will come out with a new irrigation policy in the coming days. Rao also announced an allocation of Rs.3,900 crore to build 60,000 housing units for people living below the poverty line.

The government said it will allocate Rs.2,631 crore to Greater Hyderabad Municipal Corporation to build multi-level flyovers to ease the traffic problem of Hyderabad city. Rao said the state cabinet had approved a decision to carve out new districts citing better governance and administrative convenience.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

9.2. India Inc. commits Rs.30,000 crore ($4,5 bn.) investments in Tamil Nadu

Business Standard | Sep. 10, 2015

Chennai: Top corporate houses, including Adani Group, HCL, MRF, ITC and others, have committed thousands of crores in investments in Tamil Nadu. Adani Group alone is planning to invest Rs.10,000-15,000 crore in the state to set up power plants and ports.

Speaking on the side-lines of Tamil Nadu Global Investors Meet (TNIM2015), these corporate leaders said they are optimistic about the state and the country’s economy. TNGIM 2015 was inaugurated by Chief Minister Jayalalithaa on Wednesday.

Gautam Adani, chairman, Adani Group said the state offers tremendous potential for the group. Already the company is setting up a 650-megawatt (Mw) solar plant which will be the largest in the world and be operational by March 2015.

Shiv Nadar, founder of HCL, said so far the group has invested around Rs.6,000 crore in Tamil Nadu. "We expect to invest $1 billion over the next five years in Tamil Nadu," Nadar said. The money will be invested to set up new centres at Madurai and Tiruneveli. The company currently employs around 35,000 in Tamil Nadu.

He said for HCL the brain centre is Tamil Nadu. Of the total 110,000 employees around 75,000 are in India and of which around 35,000 are in Tamil Nadu, said Nadar, who hails from the state.

Tyre major MRF's Chairman K M Mammen said the company is planning to invest around Rs.4,500 crore in Perambalur, Tamil Nadu. Besides in Arakonam, Tamil Nadu and in Goa the company is planning to invest over Rs.1,500 crore. He said Tamil Nadu is a good investment destination and the state government is offering fantastic initiatives.

ITC's Chairman YC Deveshwar said at all India level the firm is looking for investment opportunities everywhere. "We have laid out a Rs.25,000 crore of investment plan. The book value of our current investment in Tamil Nadu is Rs.2,400 crore. The latest of these investments was ITC Grand Chola".

"Investing in Tamil Nadu is both the matter of the heart and head for me. I would like to make Rs.2,500 crore of investment as soon as we keep getting permissions. We have a Rs.800 crore food processing plant in Trichy. If that is quickly cleared and if we get the right incentives according to the industrial policy, we will continue to invest," he added.

He said that ITC also wants to invest more in a hotel project at Coimbatore.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

- INDUSTRY, MANUFACTURE

10.1. Auto sector may generate $300 billion revenue by 2026, create 65 million jobs

Economic Times | Sep. 03, 2015

New Delhi: The automotive sector is expected to generate up to $300 billion in annual revenue by 2026, contributing over 12 per cent to the nation's gross domestic product and creating 65 million more jobs, shows a document prepared jointly by the industry and government.

The Automotive Mission Plan 2016-26 seeks to make the automotive industry the engine of the 'Make in India' initiative. It was unveiled on Wednesday amid concerns that high taxes and the absence of key reforms like the goods and service tax in a sluggish economy could prove to be major impediments to growth.

Nevertheless, the document projects India's automotive industry to grow to over 70 million units a year by 2026, taking it into the league of China and the US. The AMP is aimed at mapping the progress of the country's automobile industry and setting its goals over the next decade.

Around 23 million vehicles were produced in India in the year ended on March 31, 2015. The industry is estimated to be worth $74 billion now. "I think a little too ambitious, if we look at the current infrastructure situation," Rakesh Batra of Ernst & Young said, referring to the targets.

The second Automotive Mission Plan unveiled by the Society of Indian Automotive Manufactures has targets

for various segments of the industry, in terms of size and contribution to the economy.

The first vision document was for the period 2006-2016. "The biggest challenge (to achieve the aim) is going to be of infrastructure. In India, the second biggest cost that we have to bear is in logistics and transportation, which is about 15 per cent," said Ravindra Pisharody, executive director, commercial vehicles, at Tata Motors.

"However, the projection made is quite achievable."

According to SIAM, the industry has been able to achieve the larger targets of the first edition of the AMP. The key achievements are investments in excess of Rs.1,60,000 crore and creation of jobs - the target is 35 million by the end of 2016. Besides, the industry is on course to hit the base-case target of Rs.5,49,000 crore revenue.

Speaking at SIAM's annual convention in New Delhi, its president, Vikram Kirloskar, highlighted the potential of the industry, but also the risks it is facing. "There are speed breakers in the form of slow government policies with no clear roadmap on GST and high taxes imposed on the auto industry ... the cumulative burden of taxes to customers on cars goes up to 84 per cent, making the industry highly uncompetitive," he said.

Others raised concerns over delayed reforms. Mahindra & Mahindra Executive Director Pawan Goenka said political stalemate was pushing several initiatives and this could derail economic recovery.

Hero MotoCorp Chairman Pawan Munjal said: "We hope the government policy frame should improve in tune with time as we move ahead and is move in the right direction in the long-term with key reforms being addressed at the earliest."

To achieve the new targets, the government must deliver on its promises, such as on ease of doing business, said YS Guleria, senior vice president for sales and marketing at Honda Motorcycle and Scooter India.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

10.2. Bosch opens fifth manufacturing plant in Karnataka

Livemint | Aug. 28, 2015

Bengaluru: German auto components maker Bosch Ltd on Thursday opened its new factory at Bidadi, an industrial area about 35 km from Bengaluru. The plant’s first phase, built at a cost of Rs340 crore, will employ about 3,000 people. It has started producing common-rail fuel injection (diesel) systems at the site.

Considerable delays in essential services like power connections had earlier prompted Stephan Berns, president and country head for Bosch India and managing director of Bosch Ltd to consider moving out of Karnataka. The Bengaluru-headquartered company earmarked close to Rs.1,500 crore in September 2013 to expand manufacturing capabilities at its two plants in the state - Adugodi and Bidadi - over seven years.

This is Bosch’s fifth manufacturing facility in Karnataka and the 14th in the country. About 17,000 of the 29,000 employees of the Bosch Group are based in Karnataka. Berns did not specify investments for the second phase of the Bidadi plant but said it would be completed by 2018. Karnataka has lost out on big-ticket projects in the past due to delays in land acquisition and government approvals.

Two-wheeler maker Hero MotorCorp decided against investing in Karnataka, choosing instead to invest Rs. 2200 crore in neighbouring Andhra Pradesh for a factory.

In 2013, Korean steelmaker Posco had scrapped its plans to build a $5.3 billion, six million tonnes per annum steel plant in the state due to delays in land acquisition and protests by farmers. E-commerce firm Amazon.in set up its warehouse in Telangana as it was unable to resolve tax disputes with the Karnataka government.

Since then, the Karnataka government has started to reach out to corporations to address their concerns. “We have got a lot of support from the government and also from the bureaucrats. Nevertheless, there have been some delays in the past which I addressed and the government has taken the message in a very positive way and this is helping us further and we appreciate this additional support,” Berns said.

The existing facility in Adugodi will be converted into a technology centre, Berns said. The company also said it would be looking to invest in start-ups.

“Bangalore being the start-up capital of India, we are in touch with many start-ups here and we are looking into this opportunity. We don’t have any fund size but are handling it flexibly. We do not say how much money we want to spend but we look at opportunities,” said Peter Tyroller, member, board of management of Robert Bosch GmbH.

The company said it was looking at start-ups focusing on Internet of Things (IOT) which can be applied to mobility, energy and smart homes. Bosch has nearly 12,000 employees in R&D.

On its car and two-wheeler automation plans, Berns said the firm was working on a global level on the three trends of automated, connected and electrified.

“The question is when is this going to come in India. In case of the automated in India, we do not see full automatic driving very soon because of traffic conditions here but we do see partial automatic driving such as emergency braking, automatic cruise control or automatic parking, which has a good market potential in India.”

Tyroller said that automatic driving in two wheelers was not yet planned but said that technology such as electronic engine management systems can be connected to smartphones and utilised to adapt to different driving conditions and control functions.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

10.3. Mercedes Benz India begins local assembly of CLA, GLA

Sep. 9, 2015

Chennai: Mercedes Benz India has announced the local assembly of two of its best-selling models - the CLA and GLA - and the Indian consumer will benefit from the decision with both models becoming substantially cheaper as a result.

According to a company statement, Mercedes Benz India will pass on the benefits of localization – ranging from Rs.1 lakh to 2 lakh -- to the end customer both for the CLA and GLA.

The locally produced CLA 200 CDI Style is priced at Rs.30.70 lakh while the petrol CLA 200 Sport is priced at Rs.32.90 lakh. The CLA 200 CDI Sport is priced at Rs.33.90 lakh.

The locally produced petrol GLA 200 Sport is priced at Rs.33.90 lakh (all prices are ex-showroom Delhi).

Mercedes-Benz India on Wednesday kicked off the production of the CLA at its Chakan plant in the outskirts of Pune. The CLA is the seventh locally assembled product from the Mercedes-Benz's portfolio.

"The local production of the CLA will help address the wait list of the products across various markets in India. It will also help cater to any exceptional demand due to the onset of the festival season," the company said in a statement.

According to the statement, India is the only country outside Europe to commence local production of the CLA. Mercedes-Benz is locally producing both the petrol and diesel variants of the CLA at the same time to address demand. The company is also starting the local production of the GLA 200 Sport (petrol version) to address the demand situation.

Eberhard Kern, MD & CEO, Mercedes-Benz India, said: "The CLA with its stunning design, technological innovations and multiple segment first attributes is already a winning product in our portfolio. It has been rapidly acquiring new customers to the brand and replicating its global success in India as well. We are

extremely satisfied with our CLA strategy, which has contributed majorly to our New Generation Cars growth and redefined the segment completely. We are confident that the local production will make the CLA even more attractive for the discerning buyers with additional value propositions and increased availability."

11. Reliance Defence ties up with UAE's ADSB to build warships

Livemint | Sep. 08, 2015

New Delhi: Reliance Defence Ltd, a unit of Anil Ambani controlled Reliance Infrastructure Ltd, has agreed to work with Abu Dhabi Ship Building (ADSB) to construct warships such as frigates and destroyers over the next 10 years for the Persian Gulf nations.

The companies are forming a joint venture to build and repair warships, and also commercial vessels, in the region, said a person close to the development, who did not want to be named. “The joint venture will open opportunities in the region over next 10 years for both the companies in excess of Rs.10,000 crore,” the person said.

ADSB is a regional provider of construction, repair and refit services for naval, military and commercial vessels in the region. It is 40% owned by Mubadala Development Company PJSC, 10% by Abu Dhabi’s government and 50% publicly traded on the United Arab Emirates’ stock exchange.

The pact could also see ADSB delivering maintenance, repair, overhaul and refit services to the vessels in line with regional requirements. Reliance Group is likely to use its newly acquired shipbuilding facilities at Pipavav in Gujarat for implementation of this collaboration. The group did not disclose investment details in its statement issued on Monday.

“Skills developed and the experience gained through this collaboration will further add to Reliance Group’s capabilities and position it favourably as a strategic partner for Indian Navy’s future programs encompassing areas such as; combat management systems (CMS), integrated bridge solutions (IBS), combat system

integration (CSI), integrated platform management systems (IPMS) and staff training and development,” the statement said.

This potential collaboration could help both firms expand their market share and address new opportunities, it said. On 22 July, Reliance Group company Pipavav Defence and Offshore Engineering Co. Ltd and Russia’s JSC Ship Repairing Centre Zvyozdochka had agreed to jointly refit and certify submarines of the 877EKM category at an estimated Rs.11,000 crore.

Reliance Group is acquiring a majority stake in Pipavav Defence through an open offer, subject to necessary approvals. Pipavav Defence had said the company proposes to execute the programme in a joint venture with the Russian firm, in which it will hold 51% stake. India will see a defence budget allocation of $620 billion between fiscal 2014 and fiscal 2022, of which 50% will be capital expenditure, according to a February report released by industry group Federation of Indian Chambers of Commerce and Industry and financial services firm Centrum Capital Ltd.

The annual opportunity for Indian firms—both state-owned and private—is expected to be $41 billion by fiscal 2022 and $168 billion cumulatively, the report said. In June, Reliance Group had applied to the department of industrial policy and promotion (DIPP), the nodal agency for foreign direct investment, for licences to make defence and aerospace products.

Group companies that applied for licenses are Reliance SED Ltd, Reliance Naval Systems Ltd, Reliance Unmanned Systems Ltd and Reliance Aerostructure Ltd., according to the DIPP website. These firms want licences to manufacture, among other things, scientific investigation ships, parts and accessories of aircraft and spacecraft, engines, turbines and radar equipment.

Reliance Group companies have sued HT Media Ltd, Mint’s publisher, and nine others in the Bombay high court over a 2 October 2014 front-page story that they have disputed. HT Media is contesting the case.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

12.1. Foxconn boost for 'Make in India': Why Taiwan Inc.'s growing interests in India deserve attention

ET Bureau | 16 Aug. 2015 | By Malini Goyal

It is a comeback with a grand spin. In 2006, the $130-billion Foxconn Technology — the world's largest contract manufacturer of smartphones — made a low-key entry into India to make handsets for Finnish handset maker Nokia.

A year ago, the Taiwanese giant pressed the exit button after Microsoft acquired Nokia and its Tamil Nadu plant faced issues.

Last weekend, the Taiwanese giant returned with a bang. In a big boost to the government's Make in India campaign, Foxconn — also called Hon Hai Precision Industry Co Ltd back home — signed a memorandum of understanding (MoU) with the Maharashtra government to invest $5 billion in an electronics factory and an R&D centre spread across 1,500 acres that will create 50,000 new jobs.

More was to follow. Early this week, Chinese handset maker Xiaomi announced that Foxconn will make its smartphones in India at a factory in Sri City, Andhra Pradesh.

Foxconn is also planning a joint venture (JV) with the Adani group which, according to media reports, entails an investment of $5 billion to manufacture electronic products such as iPhones and Kindles in facilities in Karnataka and Gujarat.

Foxconn, best known for making Apple iPhones and employing over a million people in China, plans to develop 10-12 facilities in India, including factories and data centres by 2020. It is looking to produce phones, TVs, precision mechanics, batteries, storage and the like.

It also plans to set up a start-up incubator in India along with a venture fund to invest in areas such as mobile internet, ecommerce and renewable energy.

Eventually, the company says it will invest $20 billion in India. Its upbeat chairman, Terry Gou last week told the Indian media, "May be in 10 years, we can have a factory in every state."

Doubtless the big news is that Foxconn has arrived, this time perhaps for a longer haul. But subtly, and almost unnoticed, it also flags off the arrival of Taiwan Inc. into India. Foxconn has made the big splash for now, but there are others waiting to test Indian waters.

Taiwanese smartphone maker HTC too is looking for local production and seeking to have two contract manufacturers in India to reduce costs and improve market

share.

Another smartphone maker Asus is exploring domestic manufacturing in India through which it hopes to boost market share in smartphones from 2 per cent now to 5 per cent by 2016.

PC maker Acer too has plans to boost share from 10 per cent to 12.5 per cent by year-end. "We have signed several MoU’s since January with industry associations like shipbuilding and electronics. We have had eight to nine industry delegations [going to Taiwan] so far," says David Hsu, deputy director-general, bureau of foreign trade, ministry of economic affairs, Republic of China (as Taiwan is formally known, and not to be confused with People's Republic of China, better known as just China).

He says besides Foxconn, there are other Taiwanese companies like Delta Electronics, BenQ, Micro-Star International (MSI) and tyre maker Maxxis planning to make investments in India. "So far, Taiwanese investments in India have been around $1.2 billion. They will go up substantially in future," Hsu says.

Taiwan Inc. Rising - There are many reasons why Taiwan Inc.'s growing interests in India deserve attention. For one, Taiwan is a unique, small country with its own set of problems (see Taiwan: A Ready Reckoner).

While it is a sovereign democratic state, thanks to big brother next door pursuing a one-China policy, it is not recognised by the United Nations and has official diplomatic ties with just 22-odd small countries like Burkina Faso and Swaziland.

What is impressive is despite being small (with a population of 23.4 million) and the extent of its diplomatic isolation, Taiwan has managed to build a strong economy on the back of technology and innovation. It has one of the most evolved scientific and technological infrastructures in the world.

"We have no natural resources. People are our only resource and we have worked hard to develop them," says Chien Chou, director-general, department of international cooperation & science education, ministry of science & technology.

Taiwan today is the global hub of the semiconductor and electronics industry.

Interestingly, despite the political conflict, its companies are one of the largest investors in mainland China with cumulative foreign direct investment of over $150 billion. India and Indian companies could learn a lot about building innovation and technological backbone from Taiwan.

But there are two other important reasons why Taiwan Inc.'s current thrust on India is significant. It offers important clues on the global shifts — China, its geopolitics, its economy and how the world is reorienting to the new reality with significant implications for a country like India.

Increasingly, the concerns around overdependence on China and the buzz around geographical de-risking are getting louder across the world — from the West to the East. And many large Taiwanese companies, heavily invested in China, are looking to geographically de-risk.

Concerns around rising wages in China, its thrust on import substitution and support for its own home-grown companies are adding momentum to the rethink.

"Investment in China is too high but we still treat each other like an enemy. It is good to explore other places. India is a good option. It has a huge domestic market as well," says Hsu, echoing the views of Taiwan Inc.

That in turn has huge significance for India, in realising its dream of being a manufacturer to reckon with on the global stage. To become that, India needs to become a part of the tightly networked global ecosystem of suppliers and vendors of products from consumer electronics to IT products and gizmos, which China has done so well.

Foxconn's re-entry, with the aim of setting up an entire manufacturing ecosystem, is the first big step in that direction — and a signal that India may be finally moving towards getting its manufacturing act together. "We are at an inflection point. We had missed the manufacturing bus earlier. With announcements like Foxconn's, it looks like we may be able to not just catch up but in fact leapfrog and build the manufacturing ecosystem in areas like semiconductors here in India," says Ravi Gururaj chairperson, Nasscom product council.

Make in India - To be sure, the Modi government's ‘Make in India’ campaign is not just a slogan but a critical need of the hour. Imports have been rising in India and skewing the external balance of trade. While crude oil (34 per cent), and gold and silver (12 per cent) dominate our import list, machinery (10 per cent) and electronic goods (7 per cent) form a substantial and growing chunk.

India's weak hardware industry means today it imports most of its needs — for example 65 per cent of electronics items consumed are being imported. In 2014, India imported 225 million mobile phones.

According to the government data, demand for electronic products will grow to $400 billion by 2020 of which close to $300 billion might be imported, two times the oil import bill of 2014.

Domestic manufacturing will also mean creation of jobs, so critical for a young, populous country like India. The electronics industry itself has the potential to create 28 million direct jobs, according to the government report.

Not surprisingly, government is considering a range of measures including fiscal incentives to encourage domestic manufacturing in products like LED bulbs and mobile phones. Indian Electronic and Semiconductor Association (IESA) is targeting to bring down electronics imports (finished goods and components) from 65 per cent today to 50 per cent by 2016-17.

Taiwan could be a great partner on this journey. Vinnie Mehta, executive director, Auto Component Manufacturers Association, who earlier headed hardware industry association MAIT, has been a watcher of Taiwan's rise and India's relative stagnation. "I have been in the electronics industry since 1996 and have seen how the Indian industry lagged behind as consumption rose even as Taiwanese companies constantly evolved to do cutting-edge work," Mehta says.

Taiwan today has the world's top two semiconductor foundry companies — the $25-billion Taiwan Semiconductor Manufacturing Co (which controls half of the world's market) and the $4.6-billion United Microelectronics Corp. Taiwan was the world's electronic manufacturing hub to begin contract manufacturing.

As the country became expensive for manufacturing, Taiwanese companies shifted production base overseas, especially China. "Slowly, it moved up the value chain to become an own-design manufacturing [ODM] hub and then it emerged as an own-brand manufacturing [OBM] base," says Mehta.

Now, as China starts becoming a more expensive manufacturing hub and the Chinese government starts cutting down on incentives rolled out to manufacturers, many companies are looking overseas for new production bases. India offers a good option.

Mehta recently took the first-ever delegation of auto component makers to Taiwan. "The response on both sides has been very positive," he says. And opportunities are there for the picking.

Take, for instance, electronic controls in vehicles. Today estimated at 18-25 per cent of the vehicle cost, it is likely to rise to 40-50 per cent by 2020 thanks to new fuel and safety norms, rising automation and evolution of technological features.

This is likely to create a $25-billion opportunity in the Indian market alone.

"This is a virgin territory. We do not have any manufacturing base for electronic systems in India," says Mehta.

The Road Ahead: Jayant Davar, founder of auto component maker Sandhar Technologies, spotted the Taiwanese advantage early on. In 2002, he got into his first alliance with a Taiwanese firm for advanced tool design. In 2013, Sandhar signed a technical collaboration with Lyssen Enterprises of Taiwan to manufacture instrument clusters, case gauges and the like.

Now he wants to diversify into auto-electronics and is in talks with three-four Taiwanese firms. Davar has his reasons for preferring Taiwanese firms to others with expertise in similar fields, like say the Japanese.

Japanese firms are a lot bigger and more evolved than the Taiwanese firms, he avers. "But they are also hesitant to pass on their technology to an Indian partner and now prefer their own 100 per cent subsidiaries in India. Taiwanese firms are lot more open and flexible to different kinds of tie-ups," says Davar.

Taiwan Inc.'s journey has begun slowly, but surely. Foxconn's Sri City plant will first begin assembling handsets with most components coming from China. Slowly, as they build the ecosystem, domestic suppliers will replace them.

Terry Gou told the Indian media last week, "In the first phase, we hope to assemble some components while manufacturing some. The second phase is about Skill India, so we will have precision [engineering], tooling, components and even automation or testing labs. The third phase is about key components as part of the hi-tech manufacturing."

This steady evolution will help build the manufacturing ecosystem in India. Hsu hinted that since India and Taiwan are different culturally, companies from his country could well seek to enter India via partnerships. The $300-million Tongtai Group may be one such alliance seeker.

The business-to-business company supplies machinery and equipment to various industries including automotive, aerospace, energy, electronic, semiconductor and medical equipment; it counts Hero MotoCorpBSE -2.17 %, TVS and Shriram Pistons among its Indian customers but has a sales operations in India. The company first began thinking of an India base in 2007 but never got down to executing it.

"To survive and to do business in India is very tough. It is a difficult market," says Sunny (Kuang Yu) Yang, overseas sales department, manager, Tongtai Machine & Tool Co. But now, a growing demand, a positive investment climate and a supportive government are helping turn the tide.

Tongtai is talking to a few potential JV partners, and has shortlisted Gujarat, Delhi-NCR and Bengaluru as locations to work out of. "We are realising India is growing up. And we need to be here as the business grows," says Yang.

Tongtai will first set up a technical centre and slowly scale it up from there — a trajectory that more and more Taiwanese companies are likely to follow.

(The writer was in Taiwan at the invitation of the Taiwan government)

12.2. Cellphone makers to set up manufacturing hub in Andhra

Livemint | Sep. 16, 2015

New Delhi: Three domestic mobile device makers - Micromax Informatics Ltd, Karbonn Mobile India Pvt. Ltd. and Celkon Impex Pvt. Ltd. - are coming together to set up the country’s first mobile phone manufacturing hub at Tirupati in southern Andhra Pradesh, giving a fillip to the Union government’s Make in India initiative.

The coming together of the three handset makers at a single place is expected to trigger the creation of a mobile device ecosystem as component manufacturers set up shop in the country. Most phone makers now assemble phones using components imported from China and Southeast Asian countries.

Prime Minister Narendra Modi’s government is encouraging electronic hardware companies to manufacture locally in an attempt to reduce the country’s electronics import bill.

In an attempt to create an ecosystem for electronic devices in the state, the Andhra Pradesh government has agreed to give value-added tax (VAT) exemption to component makers for 10 years. This is in addition to the 10-year VAT exemption promised to the three firms.

“Manufacturers, if they come one by one, there will be an ecosystem,” chief minister N. Chandrababu Naidu said in Vijayawada prior to signing in-principle agreements with the three firms. “We want to create this ecosystem. If you create the ecosystem, India will move very fast,” he added.

Celkon, the fifth biggest phone maker in the country, will initially work on semi-knocked down (SKD) mobile units by importing components from China, but over time expects to work on completely knocked down mobile units using components made domestically.

Y. Guru, chairman of Hyderabad-based Celkon, said his company is in the process of signing joint venture agreements with Chinese firms to make components locally. Rajesh Agarwal, co-founder of Micromax, said his firm would make products from its entire portfolio—mobile devices, tablets, LED televisions and computer monitors—at the Tirupati facility.

The state government has set aside 60 acres of land near Tirupati airport for the three units. It has identified additional land near the airport to accommodate units of other handset and component makers, Kartikeya Misra, director of industries, Andhra Pradesh, said.

The state government is talking to other handset makers such as Intex Technologies (India) Ltd and Lava International Ltd to set up a base in the state, he said.

The three domestic phone makers will be located not far from an assembly unit of Foxconn, which is making phones for Xiaomi Corp. at Sri City, also in Chittoor district. Guru and Agarwal did not disclose the scale of investment or capacities at their proposed facilities, but Misra said the projects fall under the state’s mega projects category—meaning they entail an investment of more than Rs.200 crore or employ 1,500-2,000 people.

Guru said the company plans to invest Rs.250 crore over the next three years at Celkon’s Hyderabad and Tirupati facilities. Agarwal said Micromax would invest “whatever it takes” at the Tirupati facility.

“By virtue of our scale of operation, I am sure when we come here we will invest whatever it takes to be the best,” said Agarwal, promoter of India’s second biggest phone brand. Micromax currently operates units in Uttarakhand and is investing Rs.80 crore in a unit at Hyderabad.

In addition to the VAT exemption, the Andhra Pradesh government is giving a logistics cost subsidy, and a 5% investment subsidy for the three handset makers. The facilities will be located about 120km from the Chennai airport.

“From what I have heard they got a very sweet deal with the government. This could very well be the start of something new,” said Sanchit Vir Gogia, chief analyst and group CEO, Greyhound Research, “This kind of coming together is a very difficult task for a lot of organizations. When such big brands come together, second degree and third degree suppliers will start coming together because they will realize ultimately that manufacturing lines are the same,” he added.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

12.3. Sony gets down to making in India

Business Standard | Sep.18, 2015

Japanese electronics giant Sony Corp has hitched itself on to the Make in India bandwagon. The company is getting back to manufacturing in India, after nearly a decade with plans firmed up for two models of the Bravia brand of television sets to be made at Foxconn's Sriperumbudur plant.

'As a part of the first phase of local manufacturing we have already started local manufacturing of two models of the Bravia line of televisions in India, the second phase will begin soon,' said Satish Padmanabhan, head of sales at Sony India. Manufacturing began last month and as part of the next phase the consumer electronics major is likely to locally add three to four more models of the same Bravia line to the manufacturing list.

Padmanabhan said that the models that would be made in India in the next phase are yet to be finalised. According to him, the second phase could start in this calendar year though he refused to confirm a time period.

The India arm of the company started manufacturing in India last month with two 43-inch models of its Bravia line televisions. The manufacturing is being done by Taiwanese company Foxconn at the company's Sriperumbudur plant. At the same campus, Foxconn is also assembling products for Chinese smart phone manufacturer Xiaomi.

'We wanted to be as close as possible to Indian consumers as this is an important market for us, so we took the decision of manufacturing in the country, going forward we will definitely like to increase that initiative,' Padmanabhan said.

With the central government offering sops to incentivise local manufacturing various foreign electronics major have started to manufacture in India or are mulling to do so. Electronics majors like Panasonic, Haier and Videocon are expected to increase the quantity of their local manufacturing.

Finance Minister Arun Jaitley had made provisions in the Union Budget this year to incentivise local manufacturing in line with the government's 'Make in India' initiative.

To encourage manufacturing, the central government had announced extension of the Modified Special Incentive Package Scheme (M-SIPS) for five years, streamlining the process and covering more product categories. First introduced in 2012 as part of a National Policy on Electronics, it provides for 20-25 per cent subsidy on capital expenditure for manufacturers of electronics and consumer durables.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

13.1. Cipla set to buy American business of Hetero Drugs for $550 million

ET Bureau | Sep. 4, 2015 | By Vikas Dandekar & Divya Rajagopal

Mumbai: India's third-largest drug maker Cipla is buying the American business of Hyderabad-based Hetero Drugs as it seeks to expand its fledgling presence in the world's biggest pharma market. People close to the transaction said Cipla will buy Invagen and Camber, Hetero's wholly owned subsidiary, for about $550 million, a multiple of the company's total revenues of $150-200 million.

A spokesperson for Hetero declined to comment on the transaction while Cipla said it does not comment on any product or partner discussions. "As a pharmaceutical company, we are constantly in discussions with multiple parties on potential collaboration opportunities — in line with our aspiration to drive access and ensure availability of high-quality, affordable medicines."

Cipla's efforts to expand its beachhead in the US suffered a setback recently after it lost out to Lannett in the race to buy Kremers Urban, the generics business of Belgian drug maker UCB.

Cipla's Indian rivals have a substantial presence in the US and the Mumbai-based company, founded by the feisty Dr YK Hamied, did not want to lose out on opportunities. Talks have been going on with Hetero for nearly a year, a person close to the situation said.

With the Invagen and Camber purchase, Cipla will also get access to a manufacturing facility and approvals to treat a variety of illnesses — from HIV, hypertension and heart diseases to depression drugs such as acyclovir, amlodipine, and escitalopram. Hetero received a boost recently when it secured the approval to make aripiprazole, a blockbuster drug used to treat schizophrenia and bipolar disorder.

13.2. GSK begins work on Greenfield pharma plant in Karnataka

Livemint | Sep. 09, 2015

Hyderabad: GlaxoSmithKline Pharmaceuticals Ltd, the Indian unit of UK-based GlaxoSmithKline Plc. (GSK), on Tuesday said it has started work on its largest greenfield tablet manufacturing facility in Vemgal in Kolar district, Karnataka, with an estimated investment of Rs.1,000 crore.

The facility, coming up on a 50-acre site, will make more than 8 billion tablets and 1 billion capsules a year in the areas of gastroenterology and anti-inflammatory medicine. It will be fully operational in 2017, employing about 250 people.

This new facility is part of GSK’s strategic plan to rationalize, streamline and reduce costs in the supply network, while increasing capacity to meet the growing demands for important medicines, GSK said in its annual report. It includes a warehouse, site infrastructure, employee welfare centre and utilities to support the manufacturing and packing of the medicines.

GSK said it chose Vemgal for reasons including availability of skilled staff, proximity to southern distribution hub, moderate climate, easy accessibility, availability of state based investment incentives and government land.

“We fully support the government in their efforts to increase access to affordable medicines to improve healthcare and we are very excited to begin work on what will become our largest manufacturing facility in India,” said Annaswamy Vaidheesh, managing director, GlaxoSmithKline Pharmaceuticals.

GSK which markets popular brands like Zinetac, Calpol, Neosporin, Betnesol, Zyloric, Zentel, and Cetzine in India, reported a turnover of Rs.2,653 crore for the year ended 31 March and a market share of 3.48%.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

14.1. India growth engine of Asia: GE chief

Agencies | Sep. 5, 2015

New Delhi: With plans for more investments in line with the `Make in India' initiative, US conglomerate General Electric's chairman Jeff Immelt is headed for India later this month. Describing India as a "growth engine for Asia", Immelt said there is huge manufacturing potential in the country.

GE, which has diverse business interests spanning manufacturing to healthcare, is keen to bolster its partnership with India and wants to be part of efforts to make the country a global manufacturing destination.

"India is a growth engine for Asia, and we see huge potential for the country in the manufacturing space," Immelt said in a statement.

"Infrastructure is a key driver of India's growth. We are keen to invest much more in India and in projects to boost its infrastructure in sectors such as rail, power and healthcare. These efforts will have a ripple effect on the overall economic growth in India and beyond," he said.

GE has doubled its investment in the country over the last five years and the group is ensuring that investments and jobs created in India support the `Make in India' initiative, the statement said.

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14.2. Air bag makers eye $2 billion opportunity in India

IBEF | Sep. 14, 2015

New Delhi: The world’s largest air bag suppliers like Autoliv Inc., Takata Corp, TRW Automotive Inc. and Toyoda Gosei Co are setting up plants and increasing capacity in India as it provides a US$ 2 billion opportunity due to tougher rules aimed at improving India's road safety.

The planned changes will create an opportunity for makers of safety equipment, as cars without air bags will achieve only the lowest safety ratings after tests. By 2020, overall revenues from airbag sales in India are set to rise 11 per cent a year to hit US$ 2 billion, outpacing the 9 per cent growth expected in China, according to data from Transparency Market Research.

By then, India is expected to be selling over 5 million cars a year. This is the right time to invest to grow the business,” said Harish Lakshman, managing director of air bag maker Rane TRW Steering Systems Ltd. The company opened a new air bag assembly plant in August in southern India with capacity to make 500,000 units a year, investing Rs.18 crore (US$ 2.7 million).

Toyoda Goesi Minda India, a joint venture between the Japanese company and India’s Uno Minda plans to increase its capacity by up to six times to 150,000 air bags over the next two to three years. “We expect that within five years the large airbag makers will have a manufacturing hub in India,” said Ayay Bandopadhyay, automotive research analyst at Transparency Market Research.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

15.1. Aricent to invest $500 M in next 3yrs in India

PTI | Sep. 6, 2015

New Delhi: Communications software firm Aricent plans to invest USD 500 million or about Rs.3,000 crore in India over the next three years to boost its product development capacity in the country.

"From a corporate perspective, Aricent will be investing USD 500 million in the next three years in India, as it is the key geography for us," Aricent chief strategy officer Payal Koul Mirakhur said.

The US-based company develops software in communication segment and most of these software’s are made to control or manage function of hardware’s in a system.

"We are a high growth company, growth is our focus. We want to increase our delivery capability by the same percentage out of our delivery centres in India. We will make this investment in people, lab and research and development," Mirakhur said.

Aricent has centres in Europe and the US as well but India continues to be its key delivery centre. It has offices in Gurgaon, Chennai, Hyderabad and Bengaluru. Of the USD 500 million, the company has already invested USD 180 million to acquire India start-up Smartplay which has expertise in development of digital, analog, wireless software and system design.

"The transaction is complete. We announced the merger on August 11, 2015. I am an Aricent employee now," Aricent Semiconductor Business Unit President Pradeep Vajram said. Vajram was heading Smartplay before it got acquired by Aricent.

"We need to increase capacity across many segments. More specifically in India, we plan to grow the teams and basic customer requirements," Vajram said. Talking about the business growth from domestic market, Mirakhur said that whole concept that government is coming up with is indirectly helping businesses to grow.

"This has encouraged global companies to work in India. Certainly it is a great step towards encouraging business in India," She said. Aricent at present has 10,200 employees in India which includes 1,200 workforce that it acquired through Smartplay. The company has additional 1,000 employees working outside India.

15.2. Ericsson introduces 5G mobile tech in India

Business Standard | Sep. 03, 2015

Mumbai: Swedish telecom equipment maker Ericsson on Wednesday announced introduction of a new radio system in the Indian market, which will help mobile companies roll out fifth-generation (5G) services in future.

"With the Ericsson Radio System, total cost of ownership will reduce by 20 per cent," Hans Vestberg, president and chief executive, said on Wednesday.

The system gives operators the infrastructure they need to support mobile data demand, predicted to reach 25 Exabyte’s per month globally by 2020, when 5G is expected to be commercialised, the company said.

Earlier in 2015, Ericsson had carried out a demonstration of pre-standard 5G radio technology, delivering speeds of 5 gbps (gigabytes per second) using 15GHz spectrum. Though the 5G standards will be firmed up only around 2020, pre-commercialisation launch of 5G will happen at the 2018 Olympics, Vestberg said.

Vestberg added Ericsson would commission its Pune factory by the second quarter of 2016. The firm has invested $15-20 million in the plant, which will become a hub for exports from India to all 180 countries Ericsson operates in.

It has also invested in software that can be employed for connected devices known as internet of things (IoT) with limited battery usages. "We are co-creating end-to-end IoT network and device solutions. These put our mobile operator customers solidly on the road to 5G," said Arun Bansal, senior vice-president and head of the radio business unit.

IoT are connected devices that can be employed in a building or any device for smooth operation. The main causes of limited usage of such devices are high cost, low device battery life, and poor cellular coverage in both remote areas and deep inside buildings.

Ericsson said it has started working on finding solutions to mitigate such challenges by collaborating with leading chip makers and other leaders in the respective technology to reduce cost, improve network connectivity and battery life of a IoT device to up to 10 years.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

16.1. For start-ups, India is most competitive, says Nandan Nilekani

TNN | Sep. 19, 2015 | By Shilpa Phadnis

Infosys co-founder and former UIDAI chief Nandan Nilekani has become closely involved with the Indian start-up ecosystem over the past one year. He has advised mobile ad network InMobi, invested in space Start-up Team Indus, and very recently backed prepaid mobile tracker Mubble.

In an interview to TOI, Nilekani talks about how start-ups are innovating for the Indian market.

Excerpts:

There's a lot of talk about a valuation bubble in the start-up space. Do you think a bust is imminent?

I'm no expert on market timing. But I think India is the most hyper competitive internet market in the world. In the US, you don't have Chinese companies — WeChat and Alibaba may be huge in China, but they don't exist in America. Conversely, the American companies are not there in China.

India is the only country in the world where the American, Chinese and home-grown companies are competing. Suddenly, there are three levels of competition.

You have Amazon competing in e-commerce; companies like Alibaba and Softbank investing in Paytm and Snapdeal, and you have a home-grown company like Flipkart.

There will be winners and losers in any hyper competitive market. The good news is the sector will be transformed and customers will benefit.

You have been talking about a WhatsApp-like movement in the Indian financial sector. Can you elaborate?

We are at a stage in the financial sector where the telecom sector was when WhatsApp was launched in 2009. WhatsApp was not launched by the big telecom companies like AT&T or Verizon. It was launched by a start-up.

We have a similar situation in the banking sector today where there is a massive disruption happening — Tech, government and regulatory disruption with payments banks, and unified payment interface (designed to enable account holders to send and receive money from their smartphones with a single identifier — like Aadhaar number or mobile number — without entering any bank account information).

Incumbents like the large banks, as also start-ups and mobile companies which are getting payments bank licences, can take advantage of it. It's an open environment. And any which way, the customer will get superior products and services.

Do you feel Indian start-ups are simply copying Western innovations? And if so, are these sustainable models?

I think everybody is doing things keeping the Indian condition in mind. A lot of them have to do with the weaknesses in our system. If you look at the great innovation of the mobile industry, it is the prepaid model.

The telecom players realized that millions of Indians don't have the ID systems required for post-paid, and that many want to control their spends. Today, 95% of phones in India are prepaid.

Similarly, in e-commerce, companies came up with cash-on-delivery. It's an Indian innovation and it's come to a point that Uber is also offering it. I think those who adjust their business model to Indian conditions and come up with brand new models adjusted to Indian conditions, are going to succeed.

There are a few poster boys in the start-up space — Flipkart's Bansals, Ola's Bhavish Aggarwal, InMobi's Naveen Tewari. Any favourites?

I'm a big admirer of these guys. I like Naveen Tewari and Abhay (of InMobi). They are very strategic in the way they approach the global markets.

Paytm's Vijay Shekhar Sharma wants to be a large player in payments, Sachin is my neighbour in Koramangala... doing a great job in retail. Bhavish is from my college and he is half my age, but he's doing a great job with Ola. All these guys are impressive and I wish them all the best.

Start-ups are debating whether to go app-only. What do you make of it?

The number of internet connections through broadband is static and the number of mobile internet is going up at the rate 20 million per quarter. So, all the growth is coming from smartphones.

If you look at Mary Meeker's (partner in Kleiner Perkins) presentation, she says e-commerce in India is the most "mobilized" in the sense that the highest proportion of transactions coming from mobile phones is in India. So maybe it makes sense to maintain just one platform — it reduce s the overheads of managing two platforms.

16.2. Future belongs to innovative entrepreneurs: Jitendra Singh

PTI | Sep. 18, 2015

New Delhi: Ability to innovate and experiment irrespective of distinctions of gender or religion is going to be the yardstick for entrepreneurship in a world that is undergoing a paradigm shift, Union Minister Jitendra Singh has said.

"Tomorrow belongs to innovative entrepreneurs regardless of age, sex, religion or even country as we have a global market now. One does not need to be confined to India or to Pakistan for that matter," Singh said.

Singh, the Minister of State in the Prime Minister's Office, was speaking after inaugurating the Flo-SCWEC exhibition and conferences on Best Practices in Intra-Regional Business among SAARC countries.

The event has been organised by the Ficci ladies' organisation in collaboration with SAARC Chamber Women Entrepreneurs Council (SCWEC). "It's going to be a play of ideas and there will be no gender differences. The globalisation which is happening everywhere is a phenomenon that occurs regardless of other situations," Singh said.

The event was attended by delegates from all the other SAARC members - Bhutan, Nepal, Pakistan, Sri Lanka, the Maldives, Afghanistan and Bangladesh. Shaida Mohammad Abdali, the Afghan Ambassador to India, and Shaista Pervaiz Malik, parliamentarian from Pakistan and the SCWEC Chairperson, were present at the event.

"I am a firm believer that women are leaders by their very nature. We should focus on areas like closing the gender gap in business in South Asia and increasing female entrepreneurship and partnership," Malik said, adding that "women should reach boardrooms".

17.1. Google lesson for India Inc.: Innovate or you’re toast

TNN | 16 Aug. 2015 | By Vivek Wadhwa

Google's founders, Larry Page and Sergei Brin, understand advancing technologies better than almost anyone else does. That is why they reorganized Google as they did.

They realized that to survive, the company needed to make structural changes; to thrive, it needed to unleash a new innovative spirit. This is the type of thinking that every large company needs to do.

Changes in technology are happening at a pace that was unimaginable before and will wipe out entire industries. And new trillion-dollar industries will emerge. Companies such as Google, which understand — and lead — the change will thrive; industries such as India's IT services, which are holding on to old business models, will become toast.

This disruption is happening because technologies such as computing, sensors, artificial intelligence, and 3D printing are advancing exponentially — and converging. For more than 100 years, the processing power of computers has doubled every 18 months. Now it has come to the point at which our smartphones are more powerful than yesterday's supercomputers were. Faster computers are now being used to design faster computers; and computers and the information technology that they enable are absorbing other fields.

We are seeing start-ups coming out of nowhere to disrupt old industries. Note how in the US, Amazon.com disrupted bookstores and Apple shook up the music industry. Mapping apps on cell phones have displaced GPS devices — and, with these apps, Uber is transforming the taxi industry.

Innovation has globalized; business models and technology developed in one country can be easily exported to another. That's why India has companies such as Flipkart, Snapdeal, and Ola, which are worth billions of dollars.

With robotics and 3D printing, it is now cheaper to manufacture in the US and India than in China. Highly dextrous industrial robots that cost as much as a car can work alongside humans and do repetitive tasks. The cost of operating them is less than the cost of human labour, and the robots work 24x7.

India can build a new, automated, manufacturing industry and export to the entire region. Its IT industry can learn manufacturing and help western businesses automate their factories. This is a bigger market opportunity than the market for IT services ever was.

In the next three or four years, smartphones will replace cell phones, and a billion Indians will become connected on the Internet. There are amazing opportunities in this to transform commerce, education, government, and infrastructure management.

With Aadhar having provided digital identities to a billion people, digital currencies and card-less transactions have become practical. Every industry that deals with information, especially banking, can be modernized — and disrupted.

Old-line banks will surely be put out of business.

Advances in sensors are making it possible to build inexpensive medical devices that work with smartphones. An example is the Swasthya Slate, a book-sized device that performs 33 medical tests. This Delhi-made device costs Rs.35,000 and is helping 2.5 million people in J&K. It could transform healthcare worldwide.

Soon, with AI software, we will have digital doctors that can assist anyone, anywhere, via smartphone.

The energy industry is about to see the most traumatic changes, with the advances in solar and wind. Solar power, in particular, has been doubling in installations every two years for the past 30 years, and costs have fallen by 98%. It is only seven doublings, or 14 years, from being able to meet 100% of today's energy needs.

By the early 2020s, solar energy will cost less than half of what it does today, and battery technologies will have advanced to the point at which village-level storage will be practical and affordable.

By the late 2020s, clean energy will cost a tiny fraction of what coal, oil, and nuclear-produced energy does.

This is the reality, believe it or not.

When we have unlimited energy, we can have unlimited clean water, because we can simply boil as much ocean water as we want. We will be able to grow food locally in vertical farms. This can be easily 100% organic; we won't need insecticides in the sealed farm buildings.

Imagine also being able to 3D-print meat and not having to slaughter animals. This will transform and disrupt agriculture and the entire food-production industry.

Companies such as Google, Facebook, SpaceX, and Oneweb are racing to provide internet connectivity via drones, balloons, and microsatellites. It is very likely that by 2020 they will blanket the earth with WiFi.

Why then, will we need to buy cell phone minutes and data from AirtelBSE -0.62 %, Reliance or Vodafone? Their mobile businesses will surely become toast.

This all seems like science fiction; but these disruptions are coming, whether the Indian industry is ready or not. The choice is to lead as Google did, or to go the way of the dinosaurs.

17.2. Google, Facebook, Cisco and others line up to fulfill Arvind Kejriwal's free Wi-Fi dream

ET Bureau | Aug. 29, 2015 | By Akshay Deshmane

New Delhi: A string of top global names in the internet and telecom sectors including Google and Facebook have consulted with the Arvind Kejriwal government for its ambitious city-wide free wi-fi project, as the latter looks to put Delhi at par with San Francisco, Stockholm and Shanghai in offering ubiquitous internet connectivity free of charge.

Over the next two months, as the process for rolling out Free Public Wi-Fi gathers momentum, government officials expect some of the world's best known tech firms to come on board to implement the project across the capital.

"Google, Facebook, Cisco, which is a global leader, Aruba, Ericsson, Vodafone, all of these companies, including many domestic firms, have all consulted with us and shown interest," a senior Delhi government official informed ET, requesting anonymity.

The official further added that the RFP tender document has been drafted and is waiting for final approval from the administration.

Kejriwal himself presided over a meeting on Friday afternoon for this but had to leave half way, apparently because he had an appointment with the President. "Half of the discussion has been finished; the remaining half will be done on Sunday afternoon. CM said though it is a holiday, he will have a meeting. He changed massive portions of the RFP and redid the proposal," the official quoted earlier said.

ET wrote to Google, Facebook and Cisco seeking comments for this story. "We were approached for suggestions in very early stage discussion of this project," a statement from Google said. While Facebook's statement was more oblique, "We are committed to working with various government agencies to help make Digital India a reality." Cisco neither confirmed nor denied the discussions.

The AAP government's popular IT face and Dwarka MLA Adarsh Shastri—who oversaw the planning and consultation process—confirmed the interest shown by the companies while speaking with ET.

"The interest level is very high (among global firms) because of the huge opportunity that they feel and the fact that this is a huge database. From a social standpoint they all want to participate in bridging the digital divide. Also, Delhi being a capital city, if you do something here, you are able to showcase something not just in India but also rest of the world," he said.

There are 2 crore devices in Delhi and capacity for simultaneous log-in for 50 lakh devices will be in place over a period of time. The tender document, if cleared by the cabinet in mid-September, will be floated soon and officials expect tenders to be awarded in October.

18.1. Biocon bets big on its biosimilars offering

TNN | Aug. 15, 2015 | By Avik Das

Bengaluru: Biocon's biosimilars business is growing strongly, and with many patents for biopharma drugs starting to expire in the developed markets from 2016, biosimilars is expected to add significantly to the company's top-line.

Biosimilars are biologic products, made inside living cells and has no clinical differences in terms of safety and effectiveness from the main product. They are however not considered duplicates, like generics, by regulators as it is impossible to manufacture exact copies of biotech drugs.

Bengaluru-based Biocon, which has set a target of $1 billion in annual revenue by 2018, expects its biosimilars business to contribute about 20%, or $200 million, in 2018, from just 5%, or $22.5 million, in 2012.

"Given the not so crowded landscape at this point, the initial phase of biosimilars starting 2016 will be lucrative for the early entrants," a company spokesperson said.

Revenue from the global biosimilars market is expected to grow to about $24 billion in 2019, from $1.3 billion in 2013, as higher numbers of products penetrate North America, Europe and Asia, according to a report from global consulting firm, Frost & Sullivan.

"We expect sales from biosimilars products will become a predictable engine of growth for the company in the coming years. We are making strong inroads with biosimilars in many emerging markets," chairperson and managing director, Kiran Mazumdar-Shaw, said in a post earnings call with analysts last month.

Biocon has two generic insulins, Glargine and Rh-Insulin, and four biosimilars, Trastzumab, Adalimumab, Pegfilgrastim and Bevacizumab in Phase III trials for the developed markets. It licensed Trastuzumab in key emerging markets and launched Glargine in Mexico and Colombia in the first quarter of this fiscal.

Trastzumab, Bevacizumab and Peg-filgrastim, which are biosimilars for cancer, were manufactured by Switzerland's Roche, Genentech, a subsidiary of Roche, and US-based Amgen respectively.

Adalimumab, a biopharma drug manufactured by AbbVie, is used for treating autoimmune disease, a condition when the body's immune system attacks and destroys healthy body cells by mistake.

Biosimilars have been available in Europe since 2006, but the US Food and Drug Administration (FDA) got the authority to approve biosimilars only with the passing of the Affordable Care Act, also known as Obamacare, in 2010.

The FDA approved Switzerland-based Novartis' white blood cell-boosting Zarxio as the country's first biosimilars in March. "Considering a steady ramp up in biosimilars portfolio in emerging markets, and recovery in branded formulations, we expect Biocon to deliver +20% earning CAGR over FY15-17," PhilipCapital analyst Surya Patra wrote in a note.

Biocon, which counts Sandoz, the generic pharma division of Novartis, US-based Hospira, and Germany's Merck among its competitors in the biosimilars space, invests about 10-12% of its annual biopharma revenue on R&D. Biopharma contributed about Rs.1,806 crore to the company's total revenue for the fiscal year ended March 31.

"As an innovation led company, R&D spends are an integral part of our business. We currently have six biosimilars in the advance stages of clinical development. We will continue to invest up to 10% of our revenue in R&D as we progress further in our novel biologics and biosimilar programmes," Mazumdar-Shaw said.

18.2. Indian healthcare industry's demand for workforce to double to 7.4 million in 2022

TNN | Sep. 4, 2015 | By Neha Madaan

Pune: The Indian healthcare industry is seeing a robust growth trajectory and is expected to grow vigorously at a CAGR of 16 per cent from $73.92 billion in 2011 to $280 billion in 2020, said FICCI-KPMG report 'Healthcare: The neglected GDP driver.'

The report was recently released by the minister of state for development of northeast region and minister of state for prime minister office, Jitendra Singh, at the two-day FICCI Annual flagship Healthcare Conference - FICCI HEAL 2015.

The FICCI-KPMG report highlights how a robust healthcare system drives GDP growth in the presence of adequate investments and an encouraging environment by not only acting as a productivity and employment generator, but also as a magnet to attract foreign exchange earnings and provide opportunities for innovation and entrepreneurship.

With Indian healthcare workforce expected to double to 7.4 million in 2022 from 3.6 million in 2013 and the sector's revenue expected to grow by a robust 16 per cent CAGR to $280 billion in 2020 from $73.92 billion in 2011, Indian healthcare sector has already established itself to be an important contributor to nation's GDP.

Another important finding of the report was that increasing investments, growing innovation and entrepreneurship are expected to enhance the size of the healthcare market, thereby increasing the contribution of the healthcare sector to India's GDP.

India has received an aggregate of $377.3 billion in Foreign Direct Investment (FDI) from April 2000 to May 2015. Hospitals and diagnostics centres received FDI of $3.1 billion, or about 1.21 per cent of the FDI inflow. The share of healthcare FDI has almost doubled since 2011, highlighting the growing interest of foreign players in the sector.

19.1. Ola partners with DGR to make 60,000 ex-servicemen driver-entrepreneurs

TNN | Aug. 14, 2015 | By Karthikeyan Hemalatha

Chennai: Cab aggregator Ola has partnered with the Directorate General Resettlement (DGR) to make 60,000 ex-servicemen driver-entrepreneurs.

"'Ola Sainik' will bring ex-servicemen on board as entrepreneurs on its platform. Like tens of thousands of driver-entrepreneurs on its app, Ola will help them with training, technology and a consistent revenue opportunity by giving access to the millions of customers on its platform," said a press release from Ola.

DGR, under the defence ministry, helps ex-servicemen re-orient their skills and have a smooth transition to civilian life.  Most of them retire between the ages of 37 and 45.

"By getting ex-servicemen on board through the Ola Sainik programme, Ola is allowing top-notch talent available amongst us to serve the nation again. We believe this will go a long way in improving the lives and careers of those who have dedicated their lives to the security of the nation," said joint director of Directorate General of Resettlement Col Vipin Patpatia.

Representatives of Ola said that ex-servicemen would be a great addition to their team. "As members of the armed forces in the past, they undoubtedly constitute high quality talent in terms of skill and discipline. A stable income, an opportunity to grow and serve the nation like always, makes this initiative a win-win," said senior vice president of Ola Yugantar Saikia.

19.2. Many innovations for new economies will come from here

TNN | Aug. 14, 2015 | By Anand J & Shilpa Phadnis

Tell us about Google's initiatives in the start-up space in India. You started a little late compared to others, including Microsoft.

Google is a platform company and it's important for us to have a strong developer community with us. We had unstructured programmes for some time. But we have now brought everything under the holistic programme, Google Launchpad.

We work with early-stage and growth stage start-ups. We give them cloud support, UI (user interface) and UX (user experience) support, architectural review, go-to-market mentors. It is not just about dishing out all our programmes; we listen to the start-ups to understand India-specific needs.

There are 45 Google developer community chapters in India, and the country is among the top two in terms of activity and vibrancy.

Give us an idea of the nature of start-ups you are focusing on.

In India, most start-ups are mobile-first and cloud-first, and the relevance of Android and Google products are what we are concentrating on. At Google, we have the toothbrush analogy: Anything used twice a day is good to go. We get both B2B (business-to-business) and B2C (business-to-consumer) companies.

The success rates are slightly higher with B2B companies because founders are typically people with experience, and they are tackling specific issues. In B2C, you need more marketing dollars to get visibility.

You have a strong presence in Israel. How does the Indian start-up ecosystem compare with it?

Israelis are entrepreneurs at heart. Israel's start-up ecosystem is mature as it has been there for 12-15 years. They have had a head start; they have been exposed to cutting edge technology early.

The Indian start-up ecosystem is still nascent. We are beginning to see many youngsters give up corporate jobs to pursue entrepreneurship. The system will take time to mature.

Talking of maturity, what are some interesting signs you see?

It's the mentor ecosystem and the number of people giving back to the ecosystem without expecting anything in return. That's a clear sign of the ecosystem maturing. There are people leaving high-paying jobs and doing what they are passionate about, and they are doing it not because they have nothing else to do. For early-stage companies, we have more than 500 VCs who are doing a great job in the ecosystem, and in the last six months, the amount of investments pumped in is unheard of.

India is a mobile country, and some believe we will lead the world in mobile innovations. Do you think that could happen?

As I said, many start-ups are mobile-first and cloud-first kind of ventures. The way people strategize this requires a different mind-set. Many new innovations for emerging economies will come from India. If we can prove this is the way forward, people will follow our model in other emerging economies as well as in the West. Already, the amount of mindshare Indian start-ups have in the Valley is big; there's a new-found respect, given that many Indian start-ups are running large-scale operations today.

Some companies are going app-only. What do you make of that?

There are only 15 to 17 apps, on an average, that consumers have on their phones. If you don't see regular day-to-day use for your app, you should have a robust non-app strategy. The problem is that everybody, including investors, is looking at a mobile app presence and that creates pressure on entrepreneurs as well.

Finally, where the consumers are, start-ups will go - app or browser. It's a bold decision by Flipkart and Myntra to go app-only at that scale. Maybe it has to do with the infrastructure in the country; we need not ape the west.

Some B2B companies like Zoho, FreshDesk and InMobi have become successful globally. Will we see more visible examples?

What some of these companies have done is they have simplified the product to such an extent that any SMB, even a two-people company, is able to use it at the click of a button. I think those are the kinds of innovation that will come out of India, and many of those solutions will be on mobile.

The whole concept is, you've got a customer, and you have to delight him irrespective of what his business is and how small it is.

Do you see a valuation bubble building in e-commerce?

I don't see a bubble at this point. VCs are not looking at immediate exits. E-commerce is clearly a long-term play.

20.1. IndiGo confirms order for 250 A320s

TNN | Aug. 17, 2015 | By Saurabh Sinha

New Delhi: India's largest airline by domestic market share, IndiGo, has firmed up its last year's commitment for ordering 250 A320neo aircraft which have a list price of about $26 billion. This largest-ever aircraft purchase agreement for single aisle planes were signed last Saturday between the airline and Airbus.

IndiGo president Aditya Ghosh said: "This new order further reaffirms IndiGo's commitment to the long-term development of affordable air transportation in India and overseas. The additional fuel efficient A320neo aircraft will enable us to continue to bring our low fares and courteous, hassle free service to more customers and markets and will create more job opportunities and growth. The IndiGo team is energised and excited to herald this new phase of our growth for many years to come."

Airbus COO (customers) John Leahy said: "It fills us with pride that IndiGo, India's largest airline and one of the early launch customers for the A320neo, is coming back for more of our benchmark aircraft.... We thank IndiGo and its co-founders, Rahul Bhatia and Rakesh Gangwal, for their tremendous vote of confidence."

IndiGo had placed an order in 2005 for 100 A320s which have all now been delivered. In 2011, IndiGo became the first Indian operator to commit to the A320neo bringing their total to 280 Airbus aircraft. With the latest announcement, IndiGo has ordered 530 A320 Family aircraft with Airbus.

The A320neo or "new engine option" incorporates many innovations, including latest generation engines and large Sharklet wing-tip devices, which together deliver 15% in fuel savings from day one and 20% by 2020.

20.3. Airlines fly high on low fuel prices, travel growth

TNN | Sep. 12, 2015 | By Saurabh Sinha

New Delhi: There is some oxygen for the choking Indian airline industry. Two positive factors - domestic air travel growing at almost 30% and sharp fall in jet fuel prices - are bringing the industry back from the brink, at a time when some players were staring at emergency exits.

India's only profitable airline IndiGo reported on Thursday its highest ever net profit of Rs.1,304 crore for FY15 on an enhanced top line of Rs.14,320 crore. Reason: IndiGo did not resort to indiscriminate discounts and maintained a pricing discipline by consistently offering low - but not suicidally low - fares.

Another profitable Indian airline, Wadia Group's GoAir, is also expected to post its highest ever profit in the last fiscal, likely to be significantly better than Rs.146 crore in FY14.

Jet Airways and SpiceJet saw their losses coming down. Jet managed to bring down its loss by 49% to Rs.2,097 crore in FY15, compared to Rs.4,130 crore in the previous fiscal. SpiceJet has reported profits in the last two quarters with its founder Ajay Singh returning to the low-cost carrier earlier this year.

"Low oil prices have helped but the cost of doing business in India for an airline is among the highest in the world. Structural cost reduction is required, without banking on fickle oil prices. Unfortunately, the NDA's aviation ministry has not been able to offer any relief. The two ministers (senior A G Raju and his deputy

Mahesh Sharma) should stop disagreeing on everything and work together to make Indian aviation sustainable," said an airline insider.

Officials across airlines agreed that the change in fortune has happened only due to people flocking to the skies again and oil prices falling, while pointing to the ministry's inefficiency. They hope that Prime Minister Narendra Modi will make some systemic changes in the aviation ministry - which is described as NDA's NPA (non-performing asset) by industry watchers and stakeholders - as just changing secretaries time and again won't help.

"If PM Modi makes some changes, Indian aviation can be the world leader. IndiGo has shown that it is possible for airlines to be sustainable and we just need a little push from the government on our long-pending demands like rationalization of taxes on jet fuel and airport charges, especially in Delhi. If these issues are addressed, flying will become the norm here for the Aam Aadmi," said an official.

20.3. Carlson Rezidor plans 170 hotels in India in 5 years

PTI | Sep. 2, 2015

Mumbai: Carlson Rezidor Hotel Group, that runs Radisson hotels, today said it plans to have more than 170 properties in the country in the next five years, by focusing on Northern, Southern and Western regions.

"We are looking at increasing our India portfolio to more than 170 hotels within the next five years," Carlson Rezidor Hotel Group chief executive officer (South Asia) Raj Rana said in a statement here. Carlson Rezidor currently has 71 hotels in operation and 41 under development, across 45 Indian cities, including 14 state capitals. More properties will be added in India's Northern, Southern and Western parts, it said.

The Group recently launched its new 'Radisson Red' hotel brand in India, a key market in which Carlson Rezidor is well established as the Number 1 international operator by number of properties. The launch of this upscale lifestyle elect brand is part of Carlson Rezidor's aggressive expansion plans for India, which are aimed at extending the Group's lead in a country where it currently has 71 hotels in operation, Rana said.

"The economic outlook is optimistic and the demand for rooms in India has been growing by double-digit percentages over the past decade and this is expected to continue for the next few years.” "Domestic travel is growing and international arrivals are on the increase. This is a market that is prime for our Radisson Red brand, which is positioned to address the needs of savvy travellers, while meeting the expectations of bottom line-focused owners," he said.

"Radisson Red offers a differentiated guest experience, with lower construction and operating costs than traditional upscale hotels due to a multi-functional approach to design and efficient space-planning." The first Radisson Red hotel was signed in October 2014 in China. Radisson Red Shenyang Hunnan, part of a twin hotel development which includes Radisson Blu Shenyang, is scheduled to open in 2016.

In India, Radisson Red will be ideal for primary/ secondary cities such as Ahmedabad, Benguluru, Chennai, Delhi-NCR, Hyderabad, Kolkata, Pune, Lucknow and Mumbai as well as leisure and religious destinations such as Goa, Jaipur, Katra (J&K), Shirdi and Tirupati. Carlson Rezidor expects to have 60 Radisson Red hotels globally by 2020, Rana added.

INDIA & THE WORLD

21.1. GVK-run '108' emergency response services to be launched overseas

PTI | Aug. 15, 2015

Hyderabad: GVK-Emergency Management and Research Institute (EMRI), which operates '108' ambulance service, will launch operations in Sri Lanka and other countries, a top official said today. With a fleet of nearly 10,000 ambulances, EMRI provides emergency response services to over 750 million people across India. These services can be accessed just by dialling '108'.

"In Sri Lanka, we will start operations by the end of this year. An agreement was signed between both the countries. Government of India is funding their (Sri Lankan) operations with Rs.50 crore as an aid. They have given the job to us. We have to now buy the vehicles and send them there and start appointing people. By the year-end, it will be operational," GVK EMRI Chairman GVK Reddy told reporters here.

"We are looking at Indonesia, Thailand and SAARC countries. We will see on how the operations are being done... definitely we will enter other countries," he said at an event organised to mark 10 years of operations of EMRI services.

GVK EMRI, which started operations on August 15, 2005 with 14 ambulances and 70 people here, now has a fleet of nearly 10,000 ambulances and 42,000 employees.

This PPP-based project operates as the world's largest integrated emergency response service spread across 15 States and two UTs, GVK EMRI Director K Krishnam Raju said. "We have introduced nine other services like 181 Women Helpline, Dial 100 for Police Service, 104 Medical Helpline, Mother and Child Tracking and Facilitation Centre, Janani Sishu Suraksha Karyakram, Mobile Health Unit, Emergency Rooms etc. in the last five years," Raju explained.

To a query, Reddy said, "Definitely plans are afoot to extend the services to other States as well. The State Governments are waiting for funds from the Centre. One day the entire country will be covered."

Raju said these emergency response services are being provided in collaboration with state governments under public- private partnership (PPP) mode. On a daily basis, at GVK EMRI, over 23,000 emergencies are responded to, 800 lives saved and 200 child births are assisted. Cumulatively, 3.5 crore emergencies have been served, nearly 15,00,000 lives saved and over 3,50,000 child births have been assisted till date, he added.

22. Russia selects Anil's company to make choppers

TNN | Aug. 28, 2015 | By Shubham Mukherjee & Piyush Pandey

Mumbai: Reliance Defence & Aerospace (RDA), a Reliance Group company owned by billionaire businessman Anil Ambani, has been selected by the Vladimir Putin-led Russian government for a joint venture to manufacture 200 units of Kamov 226T helicopters in India, a major initiative that will boost Prime Minister

Narendra Modi's 'Make in India' programme. The order for the helicopters is valued at around $1 billion.

Under the three-way agreement signed between Reliance Helicopters, Russian Helicopters and Rosoboron Exports, the official agency for defence exports of the Russian defence ministry, Reliance Helicopters will be the lead integrator for a licensed production arrangement with transfer of technology from Russia.

According to two sources privy to the development, Reliance Group will have a majority 51% stake in the JV while the remaining 49% will be held by the Russian government.

The development comes at a time when the Maharashtra government has already identified land for the project which will house the Reliance Group's proposed plant to manufacture the helicopters at Nagpur.

Sources in the know said that Maharashtra chief minister Devendra Fadnavis and Union transport minister Nitin Gadkari are expected to be present at a function later this week to hand over 290 acres for the integrated defence smart city project, being billed as one of the largest aerospace facilities globally.

It may be recalled that Russian President Putin, during his summit meeting with Prime Minister Modi in New Delhi in December 2014, pushed for the Ka-226T to be made in India, and India subsequently agreed to buy 200 of these helicopters for the Indian Army as replacements for the ageing Chetak-Cheetah fleet — the lifeline for forward-deployed troops in areas such as Siachen.

A final inter-government agreement between the two countries is expected to be signed to the effect when the Prime Minister visits Russia for a summit meeting by the year end.

When asked for comments, a Reliance Defence spokesperson said, "We are committed to actively participating in Prime Minister Modi's 'Make in India' and 'Skill India' programmes. The manufacture of both military and civil helicopters to meet the needs of the country is a significant part of this commitment."

Reliance Defence, meanwhile, has already applied to the Department of Industrial Policy and Promotion (DIPP) for an industrial licence for a newly-raised company for the manufacture of helicopters.

The Reliance Group is setting up India's first smart city for the defence sector, to be called Dhirubhai Ambani Aerospace Park (DAAP), at a cost of $1 billion to manufacture helicopters for both commercial and military applications.

The project would be the first integrated facility in aerospace structure, engine design and manufacture, fabrication and platform integration in the country.

The IAF and Indian Army have a requirement of more than 600 light utility helicopters to replace the existing fleet of Chetak and Cheetah helicopters that are in service for more than 30 years. RDA has also shown interest for the tenders of providing 387 Army reconnaissance and surveillance helicopters and 100 Naval

utility helicopters, estimated to be valued at Rs.25,000 crore.

The Narendra Modi government has redesigned its military procurement programme under the 'Make in India' initiative and has also allowed 49% FDI in defence to promote local manufacturing as well as to aid the much needed technology transfer. The buy-and-make (India) scheme, under which these tenders will be issued, requires an Indian company to bid after tying up with a technology provider.

23. Citi looks at India to build banking applications for global market

Business Standard | Aug. 28, 2015

Bengaluru: US banking firm Citigroup has launched the Asia-Pacific leg of its corporate accelerator programme in India, wooing start-ups and developers to build technology solutions that could help the banking giant and its partners navigate the shifting trends in the banking industry.

The global banking industry, led by countries such as India is undergoing a fundamental shift. Hundreds of millions of new users are getting access to banking with initiatives such as zero balance account, electronic know your customer (eKYC) verification through Aadhaar, and payment banks that will allow customers to do small transactions.

Mobile operators such as Vodafone and Airtel, mobile payment solutions firms such as Paytm are already offering services such as transferring money and paying for e-commerce and taxi transactions. Most users are also using smartphones as the device for banking transactions.

Globally Citi, through its two-month accelerator programme named the Citi Mobile Challenge, is expecting around 1,000 developers in the region to build solutions that potentially could be deployed globally.

In similar programmes in Europe, West Asia and Africa, US and Latin America, Citigroup has been able to get 24 ideas that it could pilot solutions in its operations globally, Aditya D Menon, managing director of Global Digital Strategy for Citicorp Services said.

In India, Citi has partnered with firms such as Google, IBM, Amazon Microsoft Ventures, PwC, Wipro and Nasscom's 10,000start-ups programme. Finalists will get cash rewards, mentoring, office space and technology help in terms of using cloud infrastructure to host applications.

"This is the first time we're opening up APIs. We're actually going to allow APIs to be opened up for solutions to be built," said Kartik Kaushik, Country Business Manager, Global consumer Bank, Citi India.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

24.1. Preferential Treatment by India to Least Developed Countries (LDCs) in Trade in Services in the WTO

Press Information Bureau | Sep. 10, 2015

New Delhi: The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi, today gave its approval for notification of Preferential Treatment by India to Least Developed Countries (LDCs) in Trade in Services in the WTO.

India will notify preferential treatment to the LDCs in Trade in Services in respect of:

• Article XVI of the GATS (Market Access);
• Technical Assistance and capacity building; and
• Waiver of visa fees for LDC applicants applying for Indian Business and Employment visas.

The preferences will be bound with validity for 15 years from the date of notification by India.

A generous offer in Trade in Services by India should win the country goodwill of LDCs. India has already made a very generous offer to LDCs in the area of Trade in Goods in the form of a Duty Free Tariff Preference (DFTF) scheme. An equally generous offer in Trade in Services will help India preserve and consolidate its leadership position on LDC issues.

Further, given the development dimension of the Doha Round of the WTO, it is important that India makes liberal offers to LDCs in Trade in Services also. Moreover, several of the LDCs are located in South Asia while majority are in Africa with whom India maintains special relations.

India's preferential treatment to the LDCs in Trade in Services would involve a cost of Rs.6.5 crore annually on account of waiver of visa fees and Rs.2.5 to 3 crore, per annum, for providing training in management and technical consultancy courses to LDC applicants.

As regards offers under Article XVI of the GATS (Market Access) is concerned, there are no direct financial implications. Background: As per the WTO mandate, decisions of the WTO Ministerial Conferences and requests made by the Least Developed Countries (LDCs), developed country and developing country members of the WTO, in a position to do so, were to voluntarily consider providing LDCs preferential treatment in Trade in Services.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

24.2. India will give better returns on investments: Jaitley

PTI | Sep. 20, 2015

Hong Kong: Asserting that India would give better returns on investments than many other countries, Finance Minister Arun Jaitley today said foreign investments can provide great additional resources for infrastructure and other sectors.

He said that the government is giving special focus on improving the ease of doing business in the country with initiatives like 'Make In India' designed to boost the manufacturing sector that has huge potential. "India will give better returns than many other countries," Jaitley said here addressing investors and business leaders.

He said that foreign investments can give great additional resources and that the country's infrastructure sector needs huge investments.

"Railways, highways and power sectors are among those that require funds and the success of projects in these areas would largely depend on bankability," Jaitley said.

Jaitley is here for two days seeking to attract foreign investors, including large asset managers, to the Indian markets. "Special focus is being given on improving ease of doing business. Investors have felt in the past that the procedures have been difficult in India," he said.

Digital India and Make in India (initiatives) are designed to give special boost to manufacturing and India has huge potential in these areas, he added. According to him, some states were not charging adequate tariff for electricity as a result of which the health of power distribution companies is being affected.

"These states cannot expect the PSU banks to fund the deficit of discoms," Jaitley stressed. Many discoms are grappling with acute financial stress. Jaitley said that a key priority of the government was to strengthen the PSU banks. "Some weaker banks could be merged with stronger banks as just diluting stake would not resolve the problem of NPAs (non-performing assets)," he added.

Acknowledging that stalled projects have impacted the balance sheets of private sector companies, Jaitley said the proposed national investment and infrastructure fund would be a "great enabler" to attract investment as well as help repair the balance sheets of affected firms. The fund would operate independent of the government just as another investor, he added.

Noting that international investors are showing great interest in railways-related areas, the Finance Minister said the government has kick started many stalled projects in the highways sector. He also said that pension funds can play a major role in the highways space.

In response to queries about opportunities in the manufacturing and construction businesses, the Finance Minister said he would be happy to encourage investment in the manufacturing sector.

According to Jaitley, setting up of 100 smart cities would give a boost to urbanisation. Besides, he expressed hope that many states would amend their land acquisition laws.

The Finance Minister, along with a large business delegation from India, began meetings with private equity, asset management companies and other institutional investors here.

Jaitley would address the APIC-India Capital Markets and Institutional Investors Summit here tomorrow in his first visit to this global financial centres as India's Finance Minister.

He would seek to attract global investors to the Indian growth story being pursued amidst global financial markets volatility. He would also provide insights into how Prime Minister Narendra Modi-led government is tackling these challenges.

India has emerged as one of the fastest growing markets globally, despite turmoil in most of the international markets, while foreign investors have been one of the mainstays of the country's capital market growth story.

25. NHAI global arm to build roads in Iran, Sri Lanka, Nepal and Bhutan

Economic Times | Sep. 17, 2015

New Delhi: With offers to build roads and highways in Iran, Sri Lanka, Nepal and Bhutan coming its way, the National Highways Authority of India (NHAI) has decided to go global, and Roads, Highways and Transport Minister Nitin Gadkari will soon set up a separate body — NHAI International — to tap into road building possibilities outside India.

NHAI International will be a set-up outside the existing ambit of NHAI and will have its offices in several countries. It will work as a contractor mostly in neighbouring countries on the same model as railways PSUs -- IRCON, Railtel and RITES -- are undertaking construction and consultancy projects internationally.

"Recently, Iranian foreign Minister met the roads minister in Delhi and requested him to take up the roads and highways construction projects in Iran. We have an excellent opportunity to go international," a senior government official said on the condition of anonymity.

"The ministry has similar proposals from Nepal, Sri Lanka and Bhutan. We could get similar opportunities in Myanmar and several west Asian countries," the official said. The step would open up a revenue stream for the roads ministry that is planning to award contract worth Rs.5 lakh crore in India in the coming years.

The government has decided to increase India's national highways network to 1.5 lakh km within a year by adding 50,000 km more to the existing network. Roads ministry is already in the process to increase its road building capacity with the target of achieving 30 km of roads construction every day by March 2016.

The government is also planning to set up a separate body to undertake its expressways project. The ministry has planned to build more than eight expressways at a cost of Rs.16,500 crore.

"There's a committee set up for the revamp of NHAI. So, we'll act as per its recommendations," the official added. Other than building roads, the Nitin Gadkari-led ministry is also expanding its wing to build other mass transit projects connecting major cities with the suburbs.

There's a proposal to build Rs.4,000 crore mass rapid transport system that connects Manesar to Dhaula Kuan. The work on the project is expected to start by the end of this year. Under this project, small, fully automatic, driverless vehicles known as pods will travel suspended under an overhead network. The overhead network will be laid on the median of the highway stretch.

The project will cost Rs.50 crore per km as against Rs.350 crore per km cost of building a metro network. The government is likely to set up a separate body on the lines of DMRC to build more such projects around the National Capital Region (NCR) and other big cities.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.

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