INDEX of this NEWSLETTER
INDIA
- GENERAL POLICY, INFRASTRUCTURE, COUNTRY FINANCES, ETC.
2.1. India closing in on Westinghouse deal to build 6 nuclear reactors
2.2. Petronet strikes deal with Qatar’s RasGas, to get LNG at half-price
3.1. India requires Rs 31 trillion ($465 bn) for infra development over next five years: report
3.2. Slow execution of port projects defeats public-private-partnership model: CAG
4.1. SunEdison to continue its focus in India: Ahmad Chatila
4.2. Story behind falling solar power costs
4.3. Govt to spend Rs 5,000 crore on rooftop solar projects
5.1. Reserve Bank of India releases report on financial inclusion
5.2. Around 3.5 million job opportunities likely to be on offer in 2016
- AGRICULTURE, FISHING & RURAL DEVELOPMENT
6.2. India's horticulture output at a record high, despite drought and freak rains
7.1. JSW Group to invest around Rs 10,000 crore in West Bengal
8.1. Indian retail seen doubling by 2020: CII-BCG study
8.2. Andhra inks deals, unveils new retail policy
9.1. Patanjali’s noodles will soon oust Maggi as top brand: Ramdev
- INDUSTRY, MANUFACTURE
10.2. MNCs eye ‘Make in India’ opportunity
11.1. Micromax plans to make all phones locally by 2018
11.2. Smartron India and Foxconn join hands to make tablets, ultrabooks and IoT devices
11.3. Chinese handset maker Vivo sets up assembly unit
12.1. M&M, Tata Motors, Maruti team up to develop components for hybrid, e-vehicles
12.2. Maruti Suzuki sets up skill centres at Karnataka ITIs
12.3. Mahindra launches all-electric scooter GenZe in US
13.1. Kochi Metro gets first set of 'made in India' coaches
13.2. Karnataka approves Rs 23,383 crore worth projects ahead of global investor meet
14.1. New textile scheme to generate 30 lakh jobs, ₹1-lakh cr investment
14.2. Rio Tinto, De Beers and other global miners to trade on Mumbai's diamond centre
15.1. New Defence procurement plan to fire up local manufacturers
15.2. Weapons manufacture is backbone of ‘Make in India’ programme: Modi
- SERVICES (IT, R&D, Tourism, Healthcare, ETC.)
17.1. Keeping an ear out for your child (start-up)
17.2. Investment in an Indian start-up every 8 hours
18.1. Infy lets employees ‘work from home’ for 9 days in a month
19.1. Microsoft CEO Satya Nadella highlights how Microsoft could play in connecting rural India
19.2. Telecom sector to generate 700.000 new jobs in five years
20.1. A tale of two facilities and two critical cardiac devices
20.2. $100-b turnover is Centre’s biotech target
INDIA & THE WORLD
22.1. India-Africa forum Summit
22.2. Tata International plans to widen agri-business in Africa
23.1. Altran eyes more acquisitions in India
23.2. Bajaj Auto to enter 12 new export markets by March end
24.1. Canada's CDPQ to open office in India
25.1. India-Korea Business summit: Make in India gets a leg up from South Korean honchos
INDIA
- GENERAL POLICY, INFRASTRUCTURE, COUNTRY FINANCES, etc.
1.1. India brightest spot on global map with 7.8% growth in
FY17: World Bank
Economic Times | Jan. 07, 2016
New Delhi: The World Bank expects India's growth to pick up
to 7.8% in the next financial year, projecting it to be the fastest growing
economy in the world for the next three years by a distance, riding on stronger
domestic policy reforms.
India is expected to notch near 8% growth in the subsequent
years as the world economy also picks up pace to 2.9% growth in 2016 compared
with a modest 2.4% in the just concluded year. "South Asia will be a
bright spot, reflecting improved conditions in India," the World Bank said
in its flagship 'Global Economic Prospects' released on Wednesday.
The report pegs growth in the current year at 7.3%, same as
last year while raising concerns over legislative reforms. "In India,
progress in reforms is not assured as the upper house of Parliament, which the
ruling party does not control, has the power to block the government's
legislative agenda," the report said, adding that the government has made progress
in key areas such as energy and in November announced major reforms to
liberalize foreign direct investment (FDI) in several sectors.
According to the report, weak growth among major emerging
markets will weigh on global growth in 2016, but economic activity should still
pick up modestly to a 2.9% pace, from 2.4% in 2015, as advanced economies gain
speed. Recognizing that the simultaneous weakness in most major emerging
markets is a concern for achieving the goals of poverty reduction and shared prosperity,
the report warned that the spillovers from major emerging markets will
constrain growth in developing countries and pose a threat to hard-won gains in
raising people out of poverty.
"More than 40% of the world's poor live in the
developing countries where growth slowed in 2015," said World Bank Group
president Jim Yong Kim. "Developing countries should focus on building
resilience to a weaker economic environment and shielding the most vulnerable.
The benefits from reforms to governance and business conditions are potentially
large and could help offset the effects of slow growth in larger
economies."
According to the report, developing economies are forecast
to expand by 4.8% in 2016, less than expected earlier but up from a post-crisis
low of 4.3% in the year just ended. "Growth is projected to slow further
in China, while Russia and Brazil are expected to remain in recession in 2016.
The recently negotiated Trans-Pacific Partnership could provide a welcome boost
to trade," it said.
"There is greater divergence in performance among
emerging economies. Compared to six months ago, risks have increased,
particularly those associated with the possibility of a disorderly slowdown in
a major emerging economy," said World Bank Group vice-president and chief
economist Kaushik Basu. "A combination of fiscal and central bank policies
can be helpful in mitigating these risks and supporting growth."
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
2.1. India closing in on Westinghouse deal to build 6
nuclear reactors
Reuters, The Hindu | New Delhi, Dec. 24, 2015
India expects to seal a contract with Westinghouse Electric
Co LLC to build six nuclear reactors in the first half of next year, a senior
government official said, in a sign its $150 billion dollar nuclear power
programme is getting off the ground.
The proposed power plant in Gujarat will accelerate India's
plans to build roughly 60 reactors, which would make it the world's
second-biggest nuclear energy market after China.
India wants to dramatically increase its nuclear capacity to
63,000 megawatts (MW) by 2032, from 5,780 MW, as part of a broader push to move
away from fossil fuels, cut greenhouse gas emissions and avoid the dangerous
effects of climate change.
The United States signed a pact with India in 2008, opening
the way for nuclear commerce that had previously been stymied due to New
Delhi's nuclear weapons programme and shunning of the global Non-Proliferation
Treaty (NPT).
But hopes that reactor makers would get billions of dollars
of new business evaporated after India adopted a law in 2010 giving the
state-run operator Nuclear Power Corp of India Ltd the right to seek damages
from suppliers in the event of an accident.
Indian officials have been trying to assuage suppliers'
concerns, including by setting up an insurance pool with a liability cap of Rs
1,500 crore ($226.16 million).
A final hurdle - ratification of the International Atomic
Energy Agency's Convention on Supplementary
Compensation for Nuclear Damage
(CSC) - is expected within weeks, the Indian government official said.
The CSC requires signatories to shift liability to the
operator and offers access to relief funds.
In a statement, Westinghouse said it expected India would
move towards a framework that satisfies the CSC and channels accident liability
exclusively to the operator. The statement made no reference to ongoing
negotiations.
Shares of Westinghouse's parent, Toshiba Corp, jumped as
much as 3.3 per cent on Thursday after the news, before slipping back. A
Toshiba spokesman declined to comment on the report, but noted that
Westinghouse has been confident of winning orders from India.
A deal with Westinghouse could also put pressure on General
Electric Co, whose nuclear energy venture with Hitachi was offered a site six
years ago to build reactors.
GE has still not decided whether it would move ahead with
the plan, the official said, adding that India was keen for a decision from the
company soon.
GE Hitachi Nuclear Energy said it had strong interest in
India, and that the CSC would be "a sustainable solution to concerns about
India's existing domestic nuclear liability law”.
India's plans for ramping up nuclear capacity have in the
past fallen far short of targets and industry officials say that the aim to
lift the share of nuclear power to a quarter of its energy mix, from barely 3
per cent now, is very ambitious.
NO MORE TECHNICAL HURDLES
Later this week, India is expected to offer Russia a site in
its southern state of Andhra Pradesh to build six reactors, on top of the six
it is already expected to build in neighbouring Tamil Nadu, Indian and Russian
officials have said.
Separately, India expects Japan, which supplies components
used in most reactors, to ratify an agreement some time in the second quarter
of 2016 to support its nuclear programme, another senior Indian government
source said.
"There are no more technical hurdles in the development
of nuclear energy for peaceful purposes," the source said.
French nuclear company Areva, which uses Japanese
components, also has a deal to build six reactors in India, although
restructuring within that company was likely to delay construction until 2017,
the first official said.
French utility EDF agreed earlier this year to buy a
majority stake in Areva's reactor business. Areva has been in price
negotiations with NPCIL for several months now, officials at the Indian
operator told Reuters in November.
Areva did not immediately respond to a request for comment.
WESTINGHOUSE DEAL
Negotiators from Westinghouse and Indian operator NPCIL have
held several rounds of talks on the nuclear plant in Mithi Virdi, the
government official said.
NPCIL declined to comment on the negotiations. Federal
minister for Atomic Energy Jitendra Singh told parliament this month that talks
were going on with French and US firms to arrive at project proposals. He
offered no details.
But the government source said Westinghouse and NPCIL were
negotiating all six reactors in one go, instead of an earlier plan to strike
deals for two at a time.
Construction of the roughly 1,100 MW reactors could begin
later in 2016, the official, who is close to the negotiations, added.
The idea was to allow the Americans and the French, India's
two close partners, to catch up with the Russians in its nuclear sector, the
official said.
"This is a train that is moving soon," the
official said.
2.2. Petronet strikes deal with Qatar’s RasGas, to get LNG
at half-price
The Hindu | 31st
Dec. 2015
Petronet LNG, India’s largest LNG importer, will ring in the
new year with good news. The company will get fuel from Qatar’s State-owned gas
producer RasGas at nearly half the cost originally agreed upon. It will also
not have to pay the ₹12,000-crore
penalty for lower off-take in 2015.
On Thursday, RasGas and Petronet signed a revised sale
purchase agreement, according to which, Petronet will get LNG at $6-7 per
million British thermal unit (mBtu). Under the original contract signed between
the two companies in 1999, Petronet would get LNG at $12-13 per mBtu. Supplies
began in April 2004. The new contract is effective January 1, 2016 and ends in
2028.
The earlier contract with RasGas did not allow any change in
pricing, resulting in the buyers paying higher than the prevailing market
price. Under the new contract, the price for the buyer will be governed by
market dynamics based on a crude price linked formula.
More gas The new contract is for a capacity of 8.5 million
tonne per annum as against 7.5 million tonne per annum in the earlier contract.
This would then be sold to Indian Oil, BPCL, GAIL (India) and Gujarat State
Petroleum Corporation.
In addition, RasGas has also agreed to waive the ‘take or
pay’ penalty of nearly ₹12,000
crore on Petronet for a lower off-take during 2015. During the year, Petronet’s
off-take was only 68 per cent of the contracted 7.5 million tonne per annum
capacity. Under the ‘take or pay’ clause, Petronet would have had to pay for
the entire contracted amount as the off-take was less than 90 per cent.
However, Petronet will now buy the volumes not taken in 2015
during the remaining term of the contract, a Petronet-RasGas statement said.
“The deal will help Indian LNG consumers save ₹4,000
crore annually,” Petroleum Minister Dharmendra
Pradhan said while announcing the deal.
At the markets Petronet’s shares closed 3 per cent higher on
the BSE at ₹254.85 on the
BSE while GAIL’s shares closed 2.18 per cent
higher at ₹375.40 on
Thursday. Indian Oil’s shares also closed 0.74 per
cent higher at ₹428.65
while BPCL’s shares ended the day at ₹
893.35, a rise of 0.44 per cent.
“The economy of the world is changing and India did not want
to lose out in the changed dynamics. We want to move towards a gas-based
economy. For this, a restructuring of the long-term contract with Qatar’s
RasGas was required,” said Pradhan.
High-level talks According to Pradhan, the importance of the
renegotiating the contract was discussed at the highest level when the Emir of
Qatar Sheikh Tamim bin Hamad Al Thani met Prime Minister Narendra Modi in April
2015.
“I went to Qatar in November to put [across] our points [of
view] there. Qatar has been a good business friend, but we're now moving from
the relationship of a buyer and a seller to long-term partners,” Pradhan added.
During 2015, LNG was available in the spot market in India
at around $7-8/mBtu, resulting in a lower off-take from Petronet’s consumers.
As a result, Petronet had to cut down its off-take from RasGas.
India’s consumption of natural gas during April-November
2015 stood at 30,672.59 million standard cubic metre, of which 13,276.80
million standard cubic metre came from regassified LNG, according to data on
the Petroleum Planning and Analysis Cell.
The company’s net profit for the second quarter of fiscal
2015-16 fell 5 per cent year-on-year to ₹248.85
crore, it said on Monday. Its net revenue fell 31.2 per cent to ₹7,544.97 crore, from ₹10,979.96 crore in the same
quarter last year.
3.1. India requires Rs 31 trillion ($465 bn) for infra
development over next five years: report
Livemint | Dec.
18, 2015
Hyderabad: Over the next five years, India will require as
much as Rs 31 trillion for infrastructure development, around 70% of which will
go into power, roads and urban infrastructure segments, according to a white
paper released by Associated Chambers of Commerce and Industry of India and
Crisil Ratings.
“To provide uninterrupted power supply to homes and
factories, and improve roads, telecom, transport and other urban
infrastructure, the country would need an investment of more than Rs 6 lakh
crore of every year or around Rs 1,700 crore every day from April 2015 to March
2020,” the white paper said.
Even though banks have faced severe stress in lending to
long-term projects, bank debt is likely to be the most used funding avenue by
the sector, followed by bond issuances and external commercial borrowings.
Two-thirds of the investments would come from debt, half of which will be
through banks. Rs 7.5 trillion, 35% of the total, could be raised through
bonds, and Rs 3.2 trillion, or 15%, via ECBs.
Bank lending towards the sector has grown 28% over the past
decade, which is higher than their overall credit growth. The challenge in such
exposure to infrastructure sector is the risks of an asset-liability mismatch
(ALM) given that the infrastructure project loans have long tenures while bank
deposits mature in short term.
Banks and financial institutions have lent Rs 75,000 crore
to the power sector for projects of 16,000 MW, as on March this year. “While
some have been boxed into a corner after aggressive bidding, others are facing
cost overruns or gas supply issues. These projects don’t have strong sponsor
company support and are not expected to turn viable in the long run,” Crisil
said, adding this could lead to high accretion of non-performing assets from
these accounts in the medium term.
Not just power sector, but the build-operate-transfer
projects in the road segment of about 7500km under the NHAI are under risk, as
half of the projects are not complete and have high cost over-runs now.
The under-construction projects require equity and cost
overrun support of around Rs 28,500 crore over the next two years. Of this,
about Rs 16,000 crore could come from the internal accruals of sponsors and
sale of stake at the SPV level. That leaves a significant shortfall of Rs
12,500 crore,” the white paper said.
The ideal mode for financing infrastructure projects will be
for banks to focus on funding up to the pre-commissioning stage of projects,
the paper said. Later, when the project has attained stability after
commissioning, banks can look at refinancing the debt through bonds to long-term
investors.
“Such refinancing will free up considerable quantum of bank
funds and enable these funds to be deployed in new infrastructure projects.
While this financing model will allow banks to address their ALMs better, bond
investors will also get good-quality, long-term assets with stable cash flows,”
the white paper said.
Also, such financing, where banks lend up to the
commissioning stage, can bring respite to developers in the form of reduced
costs and fixed rates of interest. This would require banks to adopt a stronger
risk-based pricing model for project loans in tandem with the risk associated
at different stages of the project.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
3.2. Slow execution of port projects defeats
public-private-partnership model: CAG
The Hindu | 20 Dec. 2015
Purpose of PPP model defeated due to slow progress in
project implementation.
The public-private- partnership (PPP) model to develop the
port sector has been “defeated” as it contributed only 33 per cent of the total
capacity of major ports up to March 2014, due to tardy implementation,
according to the Comptroller and Auditor General (CAG) of India.
“The PPP model was to ensure faster augmentation of
infrastructure and better service quality for the user. However, out of
capacity addition of 315.23 MTPA envisaged by the Maritime Agenda 2010-20, the
ports
achieved capacity addition of 79.80 MTPA (25.31 per cent)
during the period…Thus, the purpose of resorting to PPP mode was defeated due
to the slow progress in implementation of projects”, CAG said in its report
which was tabled in Parliament on Friday.
A total of 91 PPP projects with total capacity addition of
751.71 MTPA were sanctioned by the government up to March 2014, the CAG said in
its report on ‘Public Private Partnership Projects in Major
Ports.’
There were inconsistencies in the bidding process and
selection of PPP partners, according to the CAG. It said the ports did not
structure the PPP projects appropriately as a result of which the long term
interests of the ports were not adequately protected.
Obtaining environment clearance, timely handing over of the
projects sites and provision of committed draught in the access channel were
some reasons which affected the commissioning of projects, the auditor noted.
4.1. SunEdison to continue its focus in India: Ahmad Chatila
Livemint | Dec. 22, 2015
Mumbai: SunEdison Inc., the world’s largest renewable energy
company, expects to focus on Make in India, reduce the cost of renewable
energy, and continue evaluating foreign direct investment (FDI) in India, chief
executive Ahmad Chatila said in an interview on Monday.
US-based SunEdison, which is looking to consolidate its
business globally and cut costs after a series of big acquisitions, has placed
India on top of its priorities after the US.
The company, which started its India operations in January
2010, plans to develop over 15 gigawatts (GW) of wind and solar projects in the
country by 2022.
“India for us is an important priority. We are going to be
here in tough and good times,” Chatila said.
The company has cut 15% of its workforce and walked away
from many deals in the last few months. In November, it reshuffled management
at its two yieldcos—TerraForm Power and TerraForm Global and sold 425 megawatts
(MW) of projects in India to TerraForm Global for $231 million to repay debt.
In the yieldco model, SunEdison sells operating assets to
the yieldco company, which collects revenue by selling electricity to pay
dividends to shareholders.
The company last month walked away from a deal to acquire
Singapore-based Continuum Wind Energy Ltd, which has assets in India. Last
month the company’s aggressive bid for the tender of 500 MW capacity offered
under the Jawaharlal Nehru National Solar Mission in Andhra Pradesh saw India’s
solar power tariff touch a record-low of Rs.4.63 per kWh (kilowatt-hour).
Chatila, who was speaking in an interview on his Mumbai
visit, said SunEdison has been thinking about making investment commitments in
India but its big investments toward the government’s Make in India initiative
would take time to materialize.
“We’ve been thinking about it and looking at it for a while
but these are big investments. The projects that we do in terms of power plants
is easy, straightforward. Make in India is a little bit more complicated. We
have been pushing a lot of our suppliers to be here. We want to do our own
investment too, but these investments take billions of dollars. So to do them
takes time to analyze and assess. It’s not something that we can do quickly in
any country,” he said.
It took two years for SunEdison to finalize a partnership
with Samsung in Korea, Chatila said, while in Saudi Arabia the company has been
looking at a $6 billion project in manufacturing since middle of 2013.
The Rs.4.63 tariff has been called unviable by several
industry observers. Chatila said he was surprised with the reactions to the
development. Aggressive tariffs could prove to disappoint investors looking for
steady returns, Mint reported on Monday, quoting experts.
The cost of solar, since the company started operations in
India, have fallen about 80%, Chatila said. “The Chinese modules used to cost a
little bit less than 50 cents a year ago, today they cost 40 cents. By end of
next year or 2017, they will cost 35 cents. This is not about SunEdison, this
is how the world is moving.”
Chatila said other companies are soon going to figure out a
model around the new low tariff. “We have been saying since July 2014 to the
government here and everywhere that solar will be competitive with imported
coal at $65 per metric tonne... We have given the spreadsheet of our model to
the government. The top officials of the government in India asked us if they
can share it with our rivals and we told them yes.”
Chatila, who became president and CEO and a member of the
board in March 2009, said the Indian government has been taking the right
actions to grow the renewable energy sector. “Many people want perfection, but
I actually travel to many countries and the Indian government is doing much
better than almost all countries on policy and everything else, especially in
renewables.”
In 2016, the company plans to add 3.3-3.7GW of new capacity
globally, of which India will make up for about 20-25%.
Chatila said his company will participate in several of the
upcoming auctions under the Jawaharlal Nehru National Solar Mission (NSM),
which the country launched in 2010 with the aim of adding 20GW of
grid-connected solar power to India’s energy mix by 2022 in three phases.
India has raised its 2022 solar energy target to 100GW from
20GW as part of the Narendra Modi-led National Democratic Alliance government’s
efforts to lower dependence on coal-fuelled electricity.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
4.2. Story behind falling solar power costs
The Hindu | 29th Dec. 2015 |
The solar industry is entering a period of cost efficiency
thanks to advances in technology and competitive bidding. In today’s solar
market in India, almost every passing tender has promised to deliver cheaper
electricity.
This is good news for the procuring utilities but it has got
lenders worried on the sustainability of the projects and the security of their
loans.
The project sponsors often find it hard to believe the
tariffs quoted on a tender just lost, but soon appear prepared to match or
better it in their next bid.
This year began with a winning tariff of around ₹7 (Punjab at ₹6.88 and UP at ₹7.02) per kWh and closed well
below ₹5 (both solar
parks in AP at ₹4.63) per
kWh.
Since 2010, over 7500 MW of solar power projects have been
tendered and the winning tariffs have fallen by 58 per cent. If we peer further
back to the regulated era, winning quotes now are less than one-third of the
2009 solar feed-in tariff rates.
Cheap route The source of these gains is well recognised in
the industry, as arising from lower polysilicon costs due to economies of scale
and the learning effect, akin to that in the semiconductor industry.
China, which supplies over 51 per cent of the solar modules
we deploy, has largescale vertically integrated units manufacturing crystalline
silicon (c-Si) modules supported by a rich ecosystem.
Recent studies suggest that the supply-chain benefit from
these clusters is continuing to deliver gains resulting in cheaper modules.
In India, meantime, savings from tender of larger capacity
projects, a competitive EPC market, locally driven pre-development activity,
and increasingly, lower cost of the balance of system (comprising inverters,
power control systems, cabling) has reduced project costs.
Project developers, in response to a tender, innovate on the
layout, design components, procurement models, and take a position on future
pricing, module efficiency, and other parameters, in a manner that helps
further differentiate their bids.
In the coming months, new solar power procurement plans
totalling about 4720 MW, which is slightly larger than the entire existing
installed solar capacity, have been announced.
The key question in the minds of bidders is what further
declines can be expected on project costs. An equally relevant question for the
government is what makes or mars this trend.
Cost, benefit To start with, narrowing of technology choices
(c-Si now constitutes over 90 per cent of production) and sourcing (over
two-thirds of global supply is from China or Taiwan) has made better deals
possible.
The regulatory filings of major tier-1 global suppliers
suggest that they continue to enjoy a sizeable gross margin on module sales,
ranging from 20 per cent to 62 per cent and averaging 38 per cent, and so have
headroom to compete on price to maintain their plant utilisation and market
share.
A more recent cost benefit has come, ironically, from
cheaper primary energy, in particular, coal.
The upstream segment of polysilicon manufacture is highly
energy intensive and even as the quantity of silicon used in modules has
steadily reduced over the last decade as wafers got thin, lower energy costs
still translate into cost savings.
The energy consumed in the entire production cycle, from
refining of metallurgical grade (MG) Silicon to polysilicon and modules, and
that used in manufacture of the Balance of System, when costed at power tariffs
for energy intensive industries in China, comes to about 8.2 cents per Wp of
module.
This is a sizeable part of module price (47 cents per Wp,
2015), and buyers must look to extract energy cost savings in their procurement
negotiations, besides the anticipated drop of 1-2 cents per quarter.
The translation of global energy prices is less direct, but
competition from imports and subdued local demand caused Chinese coal mines to
drop prices, by some accounts, by 24 per cent over last year.
The government reduced wholesale electricity tariffs earlier
this year and has proposed another that together cut power tariffs by about 5.3
per cent.
Lower oil prices cut transport costs, both seaborne and
inland, especially for the heavier glass back-sheet.
The cost involved is small at around 2 cents per Wp, but the
margins of success in a widely contested Indian solar bid are slimmer still.
In the recent National Solar Mission tender for Ghani, the
gap between the winning bidder and the second placed was just 0.2 US cents/kWh,
and the top 10 bidders were separated by barely 0.6 US cents/kWh.
A new dawn India’s 100 GW plan is, by far, the most
ambitious solar procurement programme globally, and the experience of the last
five years has given it a well-drilled tender process; solar parks take out
some of the development risk.
This has reduced the cost of participation for bidders, and
several long-term players with interest to build a portfolio have emerged.
UDAY, a new government initiative to improve the performance
of discoms and rebuild their creditworthiness, will encourage investors to pare
risk margin in their target returns, and should attract global funds that have
a lower threshold risk.
Local conditions are starting to have a more pronounced
effect on tariffs as the hard costs have come down. The quality of the
procurers’ balance sheet and payment record is now starkly reflected in the
tariffs offered.
But other factors influence it too: State governments must
provide a clear roadmap to permit advance procurement actions; regulators must
permit transmission spend to minimise curtailment; and procurers must execute
the PPAs on time and avoid the temptation to haggle prices after the bids are
opened.
The global conditions are favourable and, from all
indications, will continue to drive down costs. Market evidence suggests that
solving local issues, such as the above-mentioned ones, are now a growing key
to the success.
The next time we are surprised by a record low tariff in a
solar auction, we can be certain that the tendering agency worked hard to
achieve it.
The writer is Partner and Leader Energy & Utilities, PwC
India
4.3. Govt to spend Rs 5,000 crore on rooftop solar projects
Livemint | Dec. 31, 2015
New Delhi: To encourage the use of renewable energy, the
cabinet on Wednesday promised to spend as much as Rs.5,000 crore in five years
to build rooftop solar power projects and connect them to the national
electricity network.
The effort to support the installation of 4,200 megawatts
(MW) solar rooftop systems under the National Solar Mission by 2019-20 is a
substantial increase from the earlier budget of Rs.600 crore. The government
will provide a capital subsidy of 30% to the states and Union territories for
this purpose.
The subsidy will increase to as much as 70% for some special
category states such as Uttarakhand and those in the North-East. There will be
no subsidy for private commercial establishments since they are eligible for
other benefits such as accelerated depreciation, custom duty concessions,
excise duty exemptions and tax holidays, the government said in a statement.
Houses, government offices and social and institutional
sectors such as hospitals and educational institutions are expected to create
the capacity of 4,200MW. “The industrial and commercial sector will be
encouraged for installations without subsidy,” the statement said.
The government hopes that its support for 4,200MW will have
a multiplier effect and will create a larger market, build the confidence of
the consumers and enable the balance capacity through private investments. The
government’s focus till now has been towards big solar projects and, therefore,
any step to increase solar rooftop projects is welcome, experts said.
“The potential of decentralizing solar power in India is
huge. This is a welcome step,” said Arunabha Ghosh, chief executive at the
Council on Energy, Environment and Water, a Delhi-based think tank.“But much
more clarity is needed on solar rooftop policy like net metering,” Ghosh said.
The government has substantially raised the scope of the
solar mission from 20,000MW to 100,000MW by 2022. Of the 100,000MW, at least
40,000MW will come from rooftop solar systems.At present, the sanctioned and
approved grid-connected solar rooftop capacity is 2,080MW. The government hopes
higher solar capacity will result in the abatement of about 60 million tonnes
of CO2 (carbon dioxide) per year and contribute to the efforts being taken to
tackle climate change.
The Narendra Modi administration has been pushing for solar
rooftop panels as it believes there is a large potential for generating solar
power using the unutilized space.So far, 26 states have notified regulations to
provide net metering facilities to support solar rooftop installations.
It is currently possible to generate solar power from solar
rooftop systems at about Rs.6.50 per unit, which is cheaper than diesel
generators and the cost at which distribution companies sell power to
industrial, commercial and high-end domestic consumers, the government says.
The cabinet also took note of the administrative
arrangements for implementing the India-Australia civil nuclear cooperation
agreement that came into force on 13 November.The fuel supply arrangements with
Australia will bolster energy security by supporting the expansion of nuclear
power in India.
This year has been significant for India’s nuclear sector.
During Japanese Prime Minister Shinzo Abe’s India visit earlier this month, the
two countries ironed out on a civil nuclear agreement that has been pending for
five years.
There was also significant progress with Russia and France
on civil nuclear cooperation during the year.
Also, the implementation of the civil nuclear cooperation
agreement with the US was put back on course after US President Barack Obama’s
meeting with Modi in January and their concerns regarding India’s civil nuclear
liability law were addressed.
Now, commercial negotiations between Nuclear Power Corp. of
India Ltd and Westinghouse for the construction of six units of the nuclear
power plant at Mithi Virdi, Gujarat, are on course for finalization in 2016.
To boost the ‘Make in India’ campaign in textiles, the
cabinet committee on economic affairs approved the introduction of an amended
technology upgradation fund scheme, which is expected to attract investments of
Rs.1 trillion, and create over three million jobs.
The scheme is expected to provide employment to women and
promote better technology in looms. A budget provision of Rs.17,822 crore has
been approved, of which Rs.12,671 crore is for committed liabilities under the
ongoing scheme, and Rs.5,151 crore is for new cases, said a cabinet statement.
The cabinet also gave its approval to an agreement between
the ministry of urban development and New York-based Bloomberg Philanthropies
for the latter to act as a knowledge partner for the development of smart
cities.
As the knowledge partner, Bloomberg Philanthropies will
assist the ministry in managing the cities and provide assistance to mayors and
other leaders in improving urban infrastructure and enabling public sector
innovation.
In yet another decision, the cabinet approved the signing
and ratification of an agreement for the exchange of tax information between
India and the Maldives. The agreement will stimulate effective exchange of
information between the two countries, which will help curb tax evasion and tax
avoidance.
The cabinet also approved the signing of a protocol amending
the convention between India and Slovenia for avoidance of double taxation and
prevention of tax evasion. The cabinet gave its approval to the renewal of an
agreement between India and Canada for cooperation in higher education, that is
expected to intensify existing partnerships between the two countries in the
field of higher education.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
5.1. Reserve Bank of India releases report on financial
inclusion
Livemint | Dec. 29, 2015
Mumbai: A committee set up by the Reserve Bank of India
(RBI) to prepare a five-year financial inclusion strategy has suggested that
all credit accounts be linked to a unique biometric identifier such as the
Aadhaar unique identity number to help identify multiple loan accounts and prevent
borrowers from becoming over-indebted.
The committee, in a report released on Monday, also
recommended that short-term interest rate subvention, or subsidies, on crop
loans be phased out and replaced with a crop insurance scheme for small and
marginal farmers.
The panel, headed by RBI executive director Deepak Mohanty,
was set up in July to come up with a measurable plan for financial inclusion.
The committee found that while some indicators of inclusion have improved, a
large number of people remain reliant on informal channels such as money
lenders.
One key recommendation of the committee is to link all
credit accounts with a biometric identifier such as Aadhaar and the information
shared with credit information companies.
“This will not only be useful in identifying multiple
accounts, but will also help in mitigating the overall indebtedness of
individuals who are often lured into multiple borrowings without being aware of
its consequences,” the committee has recommended.
An allegation levelled at the government’s flagship Jan Dhan
Yojana has been that the sharp rise in savings accounts could be because of
multiple accounts opened by individuals rather than a larger proportion of the
population entering the banking system. Linking each account
to a unique identity number will help stem such a phenomenon.
In assessing the progress of financial inclusion
initiatives, the committee noted that there had been improvement in some
indicators.
The average number of branches per 100,000 individuals in
India had jumped to 9.7 by June 2015, compared with 7.2 in 2010. The growth in
branch penetration has also resulted in an improvement in the number of savings
bank accounts in rural and semi-urban locations in India, the report said.
It added that the compounded annual growth rate (CAGR) in
the number of savings bank accounts opened between 2006 and 2015 in rural and
semi-urban areas has been 15.6% and 15.9%, respectively. This compares with a
CAGR of 11.8% and 10.9% in urban and metropolitan areas, respectively, the
report noted.
“The recently announced Jan Dhan Yojana by the government
marks a landmark in the quest for universal financial access. The government is
also focusing on paying benefits directly into these accounts. This will ensure
that a big chunk of the accounts opened under various schemes, which are
presently dormant, witness ‘movement’, thereby integrating access with use.
These are very heartening developments,” said the preface to the report.
Worryingly, despite the leap in the number of accounts, the
share of unorganized lenders such as money lenders has not reduced over time.
Out of every 1,000 households of marginal farmers, more than 600 are in debt to
money lenders. The share of banks is just 129 households.
Alok Prasad, an independent expert on financial inclusion
said that the report does not propose the nuts and bolts of how financial
inclusion can be furthered over the intended five-year period.
Instead of measurable and concrete actions, the committee
has made a “mishmash” of recommendations without clear milestones, said Prasad.
Among the committee’s more contentious recommendations is a
suggestion to do away with the interest rate subvention offered on short term
crop loans. They suggest that this be replaced with a universal crop insurance
scheme for small and marginal farmers.
At present, the government mandates banks to offer 2%
interest subsidy on short-term farm loans to small and marginal farmers.
The centre compensates banks for the subsidy that they
extend while giving farm loans at 7%.
The report notes that interest subsidy only increases misuse
and does not go to the intended beneficiary. Since the subsidy is only for
short-term loans, it does not encourage capital formation in agriculture as
long-term loans continue to be expensive.
“Phasing out of interest subvention will make the credit
culture more healthy and the process more transparent. The goal of the RBI has
been to do away with all sorts of subsidies in order to strengthen the credit
culture as the subsidy in many cases doesn’t reach the intended beneficiary,”
said Kalpesh Mehta, a partner at Deloitte Haskins and Sells.
Focussing on the role of technology in financial inclusion,
the RBI committee suggested low-cost mobile solutions for last-mile delivery of
banking products and proposed that the government marry mobile technology with
Jan Dhan Yojana.
The committee has recommended the use of application-based
mobile phones as points of sale for creating necessary infrastructure to
support the large number of new accounts and cards issued under the Jan Dhan
Yojana.
“One would have liked to see much more emphasis on how
technology can be the game-changer; how financial inclusion can also make
business sense for banks,” said Prasad.
The report recommended that complete digitization of land
records be taken up by the states on a priority basis to improve credit flow to
agriculture.
“This would enhance the use of mechanisation and reduce input
costs and prices,” the report says.
The Mohanty committee has warned against taking the
competence of business correspondents (BCs), who provide last-mile delivery of
banking services, for granted. It recommended a graded system of certification
of BCs, from basic to advanced training.
“BCs with a good track record and advanced training can be
trusted with more complex financial tasks such as credit products that go beyond
deposit and remittance,” the recommendations said.
It should be left to the banks to decide how much they
should depend on BCs, said Bindu Ananth, chairperson of IFMR Trust, a private
trust involved in financial inclusion.
“Banks are smart enough to figure out which BCs they are
tying up with, since they act as agents of banks and do not take up any of the
liabilities,” Ananth said.
Other recommendations include one to allow banks to open
specialized interest-free windows with simple products such as demand deposits.
The committee consisted of officials from public and private
banks, officials from payment networks, a representative from the World Bank, a
representative from the Bill and Melinda Gates Foundation and central bankers.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
5.2. Around 3.5 million job opportunities likely to be on
offer in 2016
HT Business | Jan. 04, 2016
New Delhi: The New Year could turn out to be really happy
for the job seekers.
Thanks to the much-needed reform initiatives, including
increasing the foreign direct investment in some sectors and Make in India, the
year 2016 is anticipated to create about 3.5 million job opportunities.
“We are expecting creation of about 3.5 million jobs, where
major chunk of hiring is expected in retail, app economy and automobile,”
Rituparna Chakraborty, co-founder, Teamlease Services, a staffing firm, and
president of Indian Staffing Federation, an apex body for temporary staffing
told HT.
Teamlease expects retail sector to create 1.2 million job
vacancies, followed by 650,000 in automobile, 600,000 in app economy, 300,000
in banking, financial services and insurance (BFSI), 270,000 in IT, and 300,000
in e-commerce.
A survey conducted by Indian arm of US-based staffing firm,
ManpowerGroup, said employers predict an increase of almost 42% in the hiring
numbers. “Industries like manufacturing and automation which have been
struggling, will now witness a major boost,” said AG Rao, group MD,
ManpowerGroup India.
Amit Garg, executive director, digital initiatives, HT
Media, which owns Shine.com, said, “The job creation hopefully should gain
momentum in the second-half, considering GST, digital India, Start Up India,
Stand Up India, and Smart City would come into effect.”
However, predictions on salary hikes are not much
encouraging. “Employers are expected to shell out an average salary hike of
10.8%. But, inflation will end up eroding much of the increments,” said global
professional services firm Towers Watson.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
- AGRICULTURE, FISHING & RURAL DEVELOPMENT
6.1. Sugar output up 13.2% than last year so far: ISMA
The Hindu, Our Bureau | New Delhi, Dec. 17, 2015
A total of 440 sugar mills have produced 47.86 lakh tonnes
(lt) of the sweetener till December 15 for the sugar season 2015-16, against
42.29 lt produced by 453 mills in the same period last year, registering an
increase of 13.2 per cent.
Also, about 2.5 lt of sugar has been physically exported by
mills, and contracts have been entered into for about 5 lt till December 15,
the Indian Sugar Mills Association (ISMA) said in a release.
However, ISMA said mills across the country were still
losing ₹2-3/kg over their
cost of production despite a slight increase in domestic ex-mill prices of the
sweetener. Overall, till December 15, sugar production has been higher in most
producing States, except in Andhra Pradesh and Telangana.
State-wise breakup
In Maharashtra, 164 sugar mills that are crushing cane have
produced 22.50 lt till December 15, against 166 sugar mills producing 20.73 lt
last year.
In Uttar Pradesh, where 105 out of 119 working sugar mills
had commenced crushing operations, 8.52 lt of the sweetener has been produced
so far, compared with 7.94 lt produced by 114 mills last year.
ISMA said all the 19 sugar mills in Gujarat were in
operation, producing 3.25 lt till December 15, against 18 mills producing 2.68
lt in the same period last year.
South scenario
The third largest sugar producing State – Karnataka – has an
output of 10.29 lt so far – about 3.23 lt higher than in the same period last
year.
In this sugar season, 61 mills in the State are in operation
compared to 62 last year.
However, in Andhra Pradesh and Telangana, only 18 sugar
mills could start crushing till December 15, producing 0.92 lt against 1.35 lt
produced by 23 sugar mills last year.
In Tamil Nadu, six mills were in operation and had produced
0.60 lt against 0.35 lt produced by seven mills as on December 15, 2014.
In Bihar, Punjab, Haryana and Madhya Pradesh, 11, 16, 14 and
16 sugar mills were in operation respectively, and had produced 0.54 lt, 0.20
lt, 0.40 lt and 0.30 lt, respectively.
6.2. India's horticulture output at a record high, despite
drought and freak rains
Livemint | Jan. 01, 2016
New Delhi: At a time when two consecutive droughts have
ravaged India’s farm economy, the silver lining comes from record horticulture
production, shows data released by the agriculture ministry on Thursday.
India’s horticulture output, comprising fruits, vegetables
and spices, was a record 283.5 million tonnes (mt) in 2014-15 (second advance
estimate), substantially higher than the foodgrain production of 252.7 mt
(fourth advance estimate) recorded during the year.
In fact, in 2014-15—a drought during 2014 and unseasonal
rain between February and April 2015—saw a 4.7% drop in foodgrain production,
compared to the previous year.
In comparison, India’s horticulture output rose from 277.4
mt in 2013-14 to 283.5 mt in 2014-15, an over 2% growth in output, showing
resilience to sub-par rains.
Horticulture production (269.4 mt) surpassed foodgrain
output (257 mt) for the first time in 2012-13. The trend sustained even during
the bumper crop year of 2013-14, with horticulture production (277.4 mt)
surpassing foodgrain output (265 mt).
In January 2015, Mint reported that horticulture production
during 2014-15 was set to surpass foodgrain production for the third straight
year.
In the last decade, the area under horticulture grew by 2.7%
annually and annual production increased by 7%, according to the report
Horticultural Statistics at a Glance 2015.
Horticulture has taken root by improving incomes and
productivity, generating employment and enhancing exports, the report said,
adding, “as a result, horticulture has moved from rural confines to becoming a
commercial venture”.
The data shows that Indian farmers brought more area under
horticulture, compared to foodgrain. Between 2010-11 and 2014-15, the area
under horticulture increased by 18% to 23.4 million hectares, faster than the
5% growth in the area under foodgrains.
While a change in consumption patterns, with rising demand
for vegetables, fruits, meat, milk and eggs in both urban and rural areas,
fueled horticulture and livestock initiatives across the country, schemes like
the Mission for Integrated Development of Horticulture (earlier National
Horticulture Mission) have helped expand the area under these crops.
India is currently the second largest producer of vegetables
and fruits in the world, after China.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
7.1. JSW Group to invest around Rs 10,000 crore in West Bengal
Economic Times | Jan. 07, 2016
New Delhi: Sajjan Jindal's JSW Group is looking at investing
around Rs 10,000 crore over the next five-seven years at Salboni in West Bengal.
This will involve setting up a 1,320 MW coal-based power plant, a 4.8 million
tonne cement plant and possibly a paints factory. The projects are due to come
up in phases on 4,300 acres that had been acquired by the company for a
proposed 10 million tonne steel project in 2007.
The steel project has been in shelved since JSW failed to
secure iron-ore linkage. On Wednesday, West Bengal chief minister Mamata
Banerjee inaugurated construction of the cement plant, which is seen as
boosting the image of the state government, especially with assembly elections
due this year. JSW Steel chairman Jindal said JSW Cement will first build a
cement plant of 2.4 million tonnes capacity and then double this. "The
project would be operational in next one year.
The JSW Group plans to expand it to 4.8 million tonnes in
the next 36 months," he said. JSW will also explore the possibility of
setting up a paints factory and downstream steel-processing units at the site.
Banerjee, who previously led agitations against companies acquiring land for
factories, promised all possible help and called for support from local
residents. The project is being keenly followed in Salboni, which has little
industry. The Jindal steel project announcement had kindled hopes of job
creation in 2007.
The cement venture will initially create 250 permanent jobs
and another 600 on contract. "West Bengal is likely to emerge as a bastion
of the JSW Group," said Parth Jindal, seen as successor to father Sajjan
Jindal and tipped to head the group's cement business. "We are drawing up
plans to double the capacity of the Salboni plant. This is part of JSW Cement's
larger plans to add another 10 metric tonnes of capacity in the next two years
at an investment of Rs 2,000 crore. We entered the cement business in 2009 and
now have 6 million tonnes of capacity at present, having managed to turn around
some of the units."
While the Salboni cement unit's first phase will cost Rs 800
crore, capacity doubling will require anther Rs 700 crore of investment, he
said. This is also the first time that a cement plant in the country will be
set up using imported clinker from either Vietnam or Thailand. Sajjan Jindal
said the group plans to enter into a power purchase agreement with the
government for the 2 x 660 MW power plant at Salboni that entails an investment
of Rs 8,000 crore. He said getting into paints would be a logical move.
"We consume a lot of paints inhouse for producing
colour-coated steel sheets. Since we make steel and cement which goes into
building homes we are also considering the option of entering paints
business." The group is keeping its options open on whether to acquire an
existing paints business or launch its own from scratch, Jindal said at a press
conference.
The group is also looking at the possibility of setting up
downstream steel-processing units at a later stage, he said. While ruing the
fact that his dream steel project has got stuck due to lack of raw material
support, Jindal struck a practical note regarding its future. "The
steel project is in cold storage," he said, adding that the present status
of the industry did not look promising for a new plant, in addition to the
group's plans for growing at existing sites such as Dolvi and Vijaynagar.
"But I am an optimist. In future, if there is any greenfield steel unit
that we set up, it will be at Salboni."
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
8.1. Indian retail seen doubling by 2020: CII-BCG study
Livemint | Jan. 15, 2016
New Delhi: India’s retail sector will double to $1.1-1.2
trillion by 2020 from $630 billion in 2015, riding on income growth, rapid
urbanisation and more nuclear families leading to higher per capita
consumption, says a new study.
The overall growth will be driven by key demographic
changes. By 2020, there will be a 70% rise in the income level and 100 million
more youths will enter the workforce, says the study titled ‘Retail
transformation: Changing Your Performance Trajectory’ conducted by industry
lobby Confederation of Indian Industry (CII) and consulting firm The Boston
Consulting Group.
Nearly 35% of Indians will be living in urban areas and
there will be a rapid rise in the number of nuclear families by 2020, says the
report which will be officially launched on Friday.
While the overall retail market is likely to grow at an
annual rate of about 12%, organized retail is projected to grow at 20% and
e-commerce at 40-50%, the study said. Organized retail will account for about
12% of the retail market and e-commerce will constitute about 5% by 2020, it
said.
An earlier BCG report, released in February 2015, said that
average household income will increase three times to $18,448 by 2020 from
$6393 in 2010.
Also, urbanization will increase to 40% in 2020 from 31% in
2015 and more than 200 million households will be nuclear, representing a
25-50% higher consumption per capita spend, the February report said.
By 2020, according to the latest report, about 650 million
consumers will be online, of which 350-400 million would be “digitally
influenced”, helping e-commerce to grow to $45-50 billion from $8-12 billion in
2015.
The study says that smaller towns will play a key role in
the growth of e-commerce. In tier-II towns, the relevance of variety would
increase, driven by lack of options in organized retail, it added.
Retailer will have to adapt to changes to integrate
digitally influenced consumers in a better way, says the report adding that
companies will have to build capabilities in omnichannel retailing, big data
and analytics, information technology and supply chain. The study calls upon
Indian retailers to take a strategic view of their opportunities and be clear
about their aspirations. “With organized retail having potential to be close to
12-15% of the retail opportunity and e-commerce being $45-50 billion and
potentially higher, Indian retailers would need to transform themselves to
capture the massive opportunity,” said Abheek Singhi, senior partner and
director at BCG India.
In the past few quarters, most brick and mortar retailers,
such as Croma, Future Group, which runs chains like Central and Big Bazaar, and
brands such as Nike, Puma, Catwalk, Mango and Vero Moda have gone online
through marketplaces like Flipkart, Amazon India and Snapdeal. At present, most
brick-and-mortar retailers don’t have a good multichannel offering.
“With the expected exponential increase in digitally savvy
consumers over the next decade, technology will play a key role in the
development of the Indian retail sector. Retailers will have to adopt
technology in both back-end and front-end, to bring the digitally savvy
consumer into the mainstream retail fold,” said Shashwat Goenka, sector head,
Spencer’s Retail Ltd, RP Sanjiv Goenka Group.
With more disposable income, Indians are also likely to
spend more on premium products, says Shailesh Chaturvedi, chief executive and
managing director at Tommy Hilfiger Apparels India. “While e-commerce may be a
ready answer, premiumization and upgradation of consumption may also be a very
strong force going forward. With growth of the Indian economy, discretionary
spends will rise faster and premium product will gain share, as seen in other emerging markets of Russia and
China. Indian consumers will become more sophisticated, discerning and
demanding and will be ready to pay bit more for their choices,” he said.
The report also talks about the challenges ahead for brick
and mortar retail. They include price sensitiveness of online consumers, steep
competition with e-commerce, and lower bargaining power against suppliers and
regulatory barriers. These factors may lead to lower profitability and return
on capital for such retailers when compared with other sectors and global
retailers, it added.
BCG, in its February 2015 report, had said that sales per
square foot at Indian retail stores at Rs.1,500-2,000 per square foot is much
lower than the international average of Rs.8,000-12,000 per sq.ft Even the
gross margins are lower in India by 7-8% than the international standards and
the rentals are higher by 1.5-3% on an average.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
8.2. Andhra inks deals, unveils new retail policy
Livemint | Jan. 12, 2016
Visakhapatnam: Andhra Pradesh chief minister N. Chandrababu
Naidu’s government had a busy and fruitful day at the Partnership Summit in
Visakhapatnam on Monday.
It inked deals covering a gamut of sectors—retail, steel and
gas, among others, and pledged policy changes that would ensure ease of doing
business.
The state government signed pacts worth Rs.1,500 crore with
Walmart India, Future Group, Arvind Lifestyle Brands Ltd and Spencer’s Retail
even as Naidu unveiled a policy—touted as the first-ever retail policy by a
state in India—that makes it easier for retailers to do business in the state.
The policy proposes single-desk clearance of business plans,
lets stores stay open longer, makes it easier for retailers to acquire land to
build warehouses, simplifies labour laws and relaxes stocking limits for
essential commodities, among others.
The policy is aimed at attracting investments worth Rs.5,000
crore and creating 20,000 additional jobs in the sector by 2020. The policy
will be valid for five years.
“The future is in retail without any doubt,” Naidu said on
the second day of the three-day Partnership Summit in Visakhapatnam, citing the
sector’s huge employment potential and the need for more affordable products.
“My government is totally committed (to business),” he added
at the event organised jointly by industry lobby Confederation of Indian
Industry and the state government.
Top retail executives present at the event, including Future
Group chief executive Kishore Biyani, Walmart India head Krish Iyer, Aditya
Birla Retail Ltd CEO Vishak Kumar and K. Raheja Corp group president Neel
Raheja (who is also a Shoppers Stop board member) welcomed the move and hoped
other Indian states will follow suit.
“Andhra Pradesh has led the way in areas like Essential
Commodities Act and ease of doing business. It will set a benchmark after the
retail policy,” Biyani said.
“With increased ease of doing business, we can get more time
to take care of customers and products than the government,” he added.
Biyani’s company plans to set up stores in seven cities in
Andhra Pradesh over the next six months.
Arvind Lifestyle Brands chief executive Alok Dubey termed
the new retail policy “promising”, considering it has been launched at a time
when India does not even recognise the retail sector as an industry.
Andhra Pradesh, which gets about 33% of its gross state
domestic product from the retail sector, will allow stores in the state to
issue bills (tax invoices) to shoppers in an electronic form and avoid physical
receipts. It will also exclude retailers from having to pay a fee to the state
to install signboards at their stores displaying their trade name.
It also promised better rail connectivity to backward areas,
reliable power infrastructure and simplified processes to investors in the
state. It is investing in a skill development programme for its youth.
Reliable infrastructure in power alone could help companies
such as Aditya Birla Retail Ltd save as much as 15% on capital expenditure,
Vishak Kumar said.
Meanwhile, Walmart India signed a pact with SERP to support
women farmers. SERP, or the Society for Elimination of Rural Poverty, is an
autonomous body under the state’s ministry of rural development.
“The key areas of our growth focus will be working with small
farmers, providing relevant training and skills to staff and promoting women
entrepreneurs,” Krish Iyer said.
Iyer praised the move to simplify labour laws. “In South
East Asian countries, retail stores are permitted to operate 24x7, which gives
them a possibility of providing a shopping environment where all fixed assets
are better utilized,” Iyer said.
Raheja hoped the policy would help the sector mature faster
in the country. “Retail in India is at a very early stage. In China, there
could be a 100 malls under development but in India there won’t even be 15-20.
With a little bit of facilitation from the government, a lot can change in the
next five years,” Raheja said.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
9.1. Patanjali’s noodles will soon oust Maggi as top brand:
Ramdev
PTI, The Hindu | Mumbai, Jan. 9
Yoga guru Ramdev today said Patanjali’s atta noodles is on
course to oust Maggi as the top noodles brand in the country in the next few
years, and the ‘swadeshi’ FMCG company will overtake all multinational firms in
the consumer goods space, barring Hindustan Unilever (HUL).
“Patanjali atta noodles will soon oust Maggi as the top
noodles brand in the country. Currently from about a 100 tonnes, our production
of atta noodles will be increased to 300-500 tonnes,” Ramdev told reporters at
a conference here.
“Barring HUL, we will overtake all other multinational
companies. These companies are taking money out of the country,” he added.
Patanjali, which is slowly capturing bigger share in market
by introducing array of products at a lower price, will also divert 100 per
cent of its profits towards social service, he said.
He added that Patanjali is keeping its production costs low
compared with MNCs, in order to keep the product price reasonable.
In the next five to seven years, Patanjali expects to earn
profits of Rs. 5,000 crore to Rs. 10,000 crore, and will divert it to
non-profitable causes.
Ramdev said that his persistent campaign against black money
and corruption over the last five years has created awareness among masses, but
it will take time for the government to fulfil the aspirations of the people.
“We have been persistently campaigning against black money
and corruption since the last 5 years. The result is that people are aware of
realities. Also, the country got rid of dynasty politics and a man from a
humble background, who sold tea for a livelihood, became the Prime Minister.
But, it will take some time (for the government) to fulfil all the aspirations
of the people,” he said.
Ramdev is also planning to open a chain of schools across
the country, based on vedic-cum-modern education called Acharyakulam, for which
he is awaiting government permission.
We will build a self-sustainable model, and every state
should have 2 to 3 such educational institutions,” he said.
- INDUSTRY, MANUFACTURE
10.1. 1000 companies may be part of Make in India week
Economic Times | Dec. 18, 2015
New Delhi: The Department of Industrial Policy and Promotion
(DIPP) is hoping that the 'Make in India' initiative will provide momentum to
the domestic companies as well as increase the share of manufacturing in
India's GDP to 25% from about 17% at present. In order to give a boost to the
initiative, the government plans to hold a 'Make in India week' in Mumbai in
February 2016.
The event will see the participation of over 1,000
companies, DIPP secretary Amitabh Kant said on Thursday. "Despite the
global slowdown we must continue to liberalise economy and grow foreign direct
investment by 30%...We have vigorously opened up economy for FDI," Kant
said, making a case for domestic manufacturing.
Kant said that Make in India 2.0 will be instrumental in the
growth of manufacturing in the country and through focus on labour intensive
areas it will add to employment opportunities as well. "Countries such as
the US and UK have 33% of GDP coming from manufacturing and the share is now
declining and moving towards services... We have grown on the back of service
industry...when in the development stage India should focus more on
manufacturing," he said.
With research and development one of thrust areas of Make in
India, Kant said that the time is ripe for India to get the best technology
from Europe for making hybrid and green automobiles.
"The movement of such technology to India needs to be
accelerated if we want to achieve low levels of emission and tackle the menace
of pollution," he said.
'Make in India week', to be held from February 13-18, will
focus on ten key sectors,including aerospace and defence, automobile,
construction, food processing, infrastructure, pharmaceuticals, information
technology and textiles.
It will feature exhibition of innovative products and
manufacturing processes, a hackathon and sessions on urban planning, among
other events. Prime Minister Narendra Modi had launched the Make in India
programme on September 25, 2014 in the presence of over 120 chief executives of
major Indian companies.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
10.2. MNCs eye ‘Make in India’ opportunity
The Hindu, Visakhapatnam, Jan. 1th 2016 |
The Narendra Modi government’s Make in India campaign has
got foreign companies with operations in India looking at what more they can do
in the country.
This was the message the CEOs of Indian arms of four
multinational companies conveyed at a plenary session on ‘Make in India:
drafting India’s global manufacturing strategy’, at the CII Partnership summit
here.
Big prospects These executives believe their companies are
just scratching the surface and will in the coming days look at expanding
operations in a major way.
“The Make in India call is what focused us on what else we
can do here,” said Phil Shaw, Chief Executive, Lockheed Martin India. The
aerospace manufacturer has two large facilities in India, both near Hyderabad,
from where it makes aero structures for the C130J transport aircraft and cabins
for S92 helicopters.
With the opening up of foreign direct investment in defence,
Lockheed Martin believes there are more opportunities. It is looking at
facilities in other parts of the country, mainly in partnership with Indian
companies.
Kishore Jayaraman, President–India & South Asia,
Rolls-Royce India Pvt Ltd, said the company has been present in India for
several years, starting with supplying engines, then transferring technology to
HAL, then setting up an engineering facility and building components for the
aerospace industry.
Rolls-Royce wants to now move beyond this and see what else
it can create in India. How to innovate not only for India but for the world,
is the thinking. “We want to create, make and export from this country,” he
said.
Josh Foulger, Managing Director, Foxconn India Development
Ltd, a major electronics manufacturer, said Make in India was a theme that had
brought together a lot of things. The electronics industry was a large
generator of jobs and India’s electronic consumption was growing at a steady
clip.
Foxconn started with mobiles and within a year had created
nearly 30,000 jobs and in the next three-four years, it would create several
thousand more, he said.
Srini Srinivasan, Managing Director, Hospira (a Pfizer
company), said Make in India was more than just manufacturing in India; it is
also about leveraging the capabilities that India offered to tap the global
market.
Challenges remain Frank Wisner, former US Ambassador to
India and now International Affairs Advisor to Patton Boggs LLP, a law and
lobbying firm, pointed out that in the last three years, India’s exports of
manufactured goods and services was declining. To boost manufacturing, India
needed to build infrastructure, strengthen its tax system, improve the IPR
regime and upgrade technology. Simultaneously, it had to adopt an open economic
architecture if it were to make a success of Make in India.
Irene Hors, Head of Division of Strategic Partnerships and
New Initiatives, OECD, France, said while India had made considerable progress
to liberalise the FDI regime, it needed to do more, especially in the services
sector. This would, in turn, benefit the manufacturing sector, she added.
11.1. Micromax plans to make all phones locally by 2018
IBEF | Dec. 18, 2015
New Delhi: India's second largest smartphone seller,
Micromax, plans to shift manufacturing of all its phones to India from China by
2018, compared to less than two-third assembled in India currently. The change
in strategy has been driven by the growing ecosystem and network of local
component suppliers in India.
The rising labour costs in China is also prompting the
company to consider full home production. Micromax has already announced
investment of Rs 300 crore (US$ 45 million) to construct new factories in India
and thereby reduce dependence on Chinese imports.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
11.2. Smartron India and Foxconn join hands to make tablets,
ultrabooks and IoT devices
Times of India, Dec. 21, 2015
New Delhi: Technology startup Smartron India has tied up
with Foxconn, the world's largest contract electronics manufacturer, to
manufacture a range of smartphones, tablets, ultrabooks and Internet-of-Things
(IoT) devices, starting next month. "There's a separate assembly line for
our products at the Foxconn plant in Sri City, Andhra Pradesh," Smartron
promoter Mahesh Lingareddy told ET.
He said the company will kick off its commercial operations
around mid-January. Initially Smartron, which hopes to emerge a global premium
tech products brand from India, will bring high-end 5 inch and 5.5 inch
smartphones, along with hybrid Windows tablets. In the second half of 2016,
Lingareddy said, the company will launch high-end ultrabooks and several IoT
devices, including smart cameras, storage systems, bulbs, security devices with
wireless router capabilities, smart bands and wireless chargers. Taiwan's
Foxconn is already making smartphones for Xiaomi, Gionee, Asus, and OnePlus out
of the Sri City plant.
Smartron is also evaluating a manufacturing tie-up with
Taiwan's Wistron, the world's No. 2 contract manufacturer, which recently
formed a joint venture with India's Optiemus Infracom to set up a smartphone
assembling unit in Noida. The estimated $200-million (Rs 1,320-crore) facility
is currently under construction and is scheduled to be operational by March
2016.
Smartron, which has been operating under a stealth mode for
the last nine months, is bringing small teams and companies on a single
platform for end-to-end offerings and to aggregate all IoT products. It will
also target mobile, home and enterprise infrastructure segments with these
products.
Lingareddy, who is also the CEO and co-founder of silicon
semiconductor startup Soft Machines, said there will be synergies between
Smartron and Soft Machines for several products. Soft Machines is valued at
over $1 billion and has teams in India and the US.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
11.3. Chinese handset maker Vivo sets up assembly unit
Business Standard | Dec. 23, 2015
New Delhi: Chinese smartphone major Vivo has started
manufacturing handsets in India to capitalise on various incentives and tax
cuts offered by the government to promote local manufacturing. Vivo's Rs
125-crore mobile handset assembly unit with a capacity to produce one million
handsets a month is a first in the country by any Chinese brand. It will help
the company cut down costs by 10 per cent across its portfolio, Alex Feng,
chief executive of Vivo Mobile India, said.
Vivo will initially manufacture 150,000 smartphone units a
month. The company plans to increase it to 300,000 units a month forthwith, as
local production will help it save on 14 per cent excise duty.
The firm will start its unit in Greater Noida by producing
three smartphone models - Y11, Y21 and Y15S. Eventually, it will add other
models to expand the tax benefits from local production. Various benefits
including Modified Special Incentive Package Scheme, and sops offered through
the Special Economic Zone in the locality led Vivo set up the unit, Feng said.
The company will train its new work force in the plant, which will employ 2,200
people when in full capacity. Due to this manufacturing and cost reduction of
10 per cent, Vivo handsets are going to be cheaper by at least five per cent
from now on.
Vivo, which recently replaced US beverages major PepsiCo as
the title sponsor of the Indian Premier League (IPL), will also increase its
promotional budget. It has allocated Rs 200 crore as advertisement and
promotional budget for 2016, including Rs 100 crore dedicated to IPL.
"India is strategically important for us and we will be strengthening our
position by increasing domestic production, distribution and visibility of our
brand," said Feng.
While Vivo estimates its sales to touch one million
smartphones in the country in 2015, these initiatives will help it grow further
in 2016. "In the past one year of our presence in India, we have reached
10,000 retail outlets in 400 cities, including 30 Vivo exclusive stores. We
plan to expand our service network to 200 next year from the current 25,"
he added. The firm launched two India-specific models - V1 & V1 max - in
2015.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
12.1. M&M, Tata Motors, Maruti team up to develop
components for hybrid, e-vehicles
The Hindu, Business Lina,Our Bureau | Bengaluru, Dec. 21,
2015
Mahindra & Mahindra, Tata Motors and Maruti Suzuki have
come together to invest as well as develop components and systems for electric
and hybrid vehicles.
On the sidelines of an event on Monday, Mahindra Reva Chief
Executive Arvind Mathew said that they are working on developing components and
systems to ensure common standards for them as well as help drive down costs.
This is expected to eventually lead to lower cost of ownership of these
vehicles. All the three carmakers are also working on common standards for all
components and systems though each of them will have their own software IPs.
The three companies came together after the Centre announced
in April this year, the FAME India scheme, which offers cash incentives for
those who want to buy hybrid and electric vehicles. FAME or Faster Adoption and
Manufacturing of Hybrid and Electric Vehicles in India scheme envisages ₹795 crore in incentives for
two years as part of the first phase of the National Electric Mobility Mission
Plan. The scheme has been launched in metro cities and it will be later
extended to smart cities and tier II and III towns.
The total outlay for this project is estimated at ₹14,000 crore, as per the heavy
industries ministry.
According to the scheme, the customer buying any form of
hybrid or electric vehicle will get the incentive in terms of lower cost, while
the manufacturer can claim the incentive from the government.
Electric sedans For electric cars, the incentives range
between ₹13,000 and ₹1.38 lakh, while for light
commercial vehicles, it ranges between ₹17,000
and ₹1.87 lakh. Mathew
said the electric versions of Verito sedan as well as mini-truck Maxximo will
be launched for sale in a couple of months. He said the company is in talks
with cab aggregators like Ola and other cab operators to include these electric
cars as part of their fleet.
The power train of its e2o will be used for these vehicles,
said Mathew, who earlier worked as India head of Ford. The price of Verito
sedan is expected to be much higher than e2o which costs around ₹ 6.5 lakh. Since its launch in
2004, Reva has sold about 5,500 units. Mahindra & Mahindra acquired a major
stake in Reve Electric Car Company from its founder, Chetan Maini in 2010.
12.2. Maruti Suzuki sets up skill centres at Karnataka ITIs
The Hindu | Mangaluru, Dec. 22, 2015
Maruti Suzuki will set up automobile skill enhancement
centres in six ITIs (industrial training institutes) in Karnataka, according to
an official of the company.
Speaking at the inauguration of an automobile skill
enhancement centre at Government ITI in Mangaluru on Tuesday, Kawaljeet Singh,
Regional Manager of MSIL, Karnataka, said that the Mangaluru centre is the
second such centre in Karnataka. First one was inaugurated at Mysuru 10 days
ago. The third one will be inaugurated at Davangere in a few days.
He said that MSIL has promised the Department of Employment
and Training of Karnataka that six such centres will be opened in the State.
The Mangaluru centre has an automobile workshop to make the
students ready to meet the requirements of the industry after their ITI
training. This helps the employer to reduce the time and cost towards training
after recruitment.
Singh said that MSIL has provided modern tools, equipment
and training aids worth ₹32
lakh, including an Alto K-10 car, to the automobile skill enhancement centre in
Mangaluru. A trainer from MSIL will impart skill training to students on
advancements in automobile sector, especially in Maruti Suzuki vehicles.
DB Ranjit, Deputy General Manager (service - training),
MSIL, said the company has such associations with government ITIs in 86 centres
in the country.
He said faculty members of ITIs will be trained in the
nearest Maruti Suzuki workshop or training centres. The students will undergo
periodic evaluation by the company, and will be awarded certificates on
clearance of final tests, he said.
PK Nagaraj, Divisional Joint Director of the Department of
Employment and Training, suggested that the company initiate the process of
providing communication and soft skill training to the students in such skill
enhancement centres.
Giridhar Salian, Principal of the institute, thanked the
company and the local dealers – Mandovi Motors Pvt Ltd and Bharath Autocars Pvt
Ltd – for their participation in Mangaluru skill enhancement centre.
12.3. Mahindra launches all-electric scooter GenZe in US
PTI, Business Line | 16 Jan. 2016
Mahindra has launched its all-electric scooter GenZe in a
Californian city this week as part of its effort to create a niche space for
itself in the green technology two-wheeler market in the US.
Mahindra’s GenZe 2.0, the first connected all-electric
scooter, was conceived in Silicon Valley and engineered/assembled in Ann Arbor,
Michigan.
Designed to help alleviate challenges associated with urban
commuting, parking, congestion and pollution, the scooter was formally launched
at a recent event in Oakland, California, in the presence of the city Mayor
Libby Schaaf and Mahindra Group Chairman Anand Mahindra.
“Oakland is the perfect place to combine electric bikes and
electric scooters, with mobility sharing and solar power. Projects like Bike
Solar Oakland and San Francisco’s Scoot Networks are the type of Smart City
Initiatives we are launching in Oakland,” Schaaf said.
“We are so happy to be working with Mahindra GenZe — this is
the kind of innovation and partnership we want to see — finding that pragmatic
but visionary intersection of business, environment and technology to equitably
serve our community,” she said.
“The GenZe 2.0 launch event in Oakland recognises the
creativity and determination of the Mahindra GenZe team to design and develop a
remarkably distinctive product,” said Anand Mahindra.
GenZe2.0 has a removable lithium-ion battery that can be
recharged at any standard electrical outlet, providing optimal freedom and ease
of use. Its smart, utilitarian design offers ample rear storage space so people
can get where they want and take their belongings with them.
Beyond its use as a personal vehicle, the GenZe 2.0 has also
attracted a lot of attention from cities and corporate campuses who are
searching for efficient multi-modal and first/last mile solutions to help
augment existing transportation infrastructure, a media release said.
13.1. Kochi Metro gets first set of 'made in India' coaches
Livemint | Jan. 04, 2016
Chennai/Kochi: Kochi Metro Rail Ltd (KMRL) has received the
first set of ‘Made in India’ coaches which were ordered in August 2014, five
months ahead of schedule from Alstom Transport which is the rolling stock
manufacturer for the project. The company is responsible for the design,
manufacturing, supply, installation and commissioning of 25 standard track
gauge trains.
Union Urban Development minister Mr M. Venkaiah Naidu
flagged off the first train set at an official ceremony held at the Alstom’s
facility in Sri City Special Economic Zone (SEZ) in Tada in Andhra Pradesh. The
Kochi Metro coach has differentiated itself with any other metro system by
fitting two air conditioning units per car for the comfort of commuters. The 25
coaches would run on an elevated metro rail network 25 km long and 22 stations
across Kochi. The metro line is expected to be open by end of 2016.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
13.2. Karnataka approves Rs 23,383 crore worth projects
ahead of global investor meet
Livemint | Jan. 05, 2016
Bengaluru: The Karnataka government on Monday said it had
approved six investment proposals worth Rs.23,383 crore at a high-level meeting
chaired by chief minister Siddaramaiah, ahead of the state’s global investor
summit scheduled for next month.
Among the proposals that got the nod is the Rs.14,800 crore
investment by Karnataka Solar Power Development Corp. Ltd for setting up a
2,000 megawatt (MW) solar park in Tumkur district, some 70 km from Bengaluru.
Of the other two fresh investment proposals, one worth
Rs.1,889 crore, is by Minerva Steel Pvt. Ltd to build a steel plant, and
another worth Rs.1,352 crore is by Wadi Cement Co. Pvt. Ltd to build a cement
plant.
The rest of the approvals were given for expansion projects,
including a Rs.4,570 crore investment by Udupi Power Corp. Ltd to increase its
power generation unit’s capacity in Udupi from 1,200 MW to 2,800 MW, a Rs.620
crore expansion proposal by Tata Power Kirloskar in Kolar and a Rs.150 crore
proposal by Toyota Textile Machinery Pvt. Ltd in Bengaluru.
Once they take off, the investments will generate employment
for 10,407 people, the government said.
As Karnataka prepares for the global investor summit, the
government is targeting a total of Rs.1 trillion in investment in the next 40
days, K. Ratna Prabha, additional chief secretary in the industries department,
told Mint in an interaction.
“We have already received proposals worth Rs.62,770 crore
for the meet, out of which Rs.24,577 crore has been cleared. The rest is in the
pipeline. Our aim is to get Rs.40,000 crore or so in the next 40 days to reach
a realistic target of Rs.1 trillion in this meet,” said Ratna Prabha.
While the chief minister clears projects under Rs.100 crore,
those involving larger investments are approved by the state’s high-level
clearance committee.
To be sure, the approval means the government has cleared
certain requirements for the project to take off. It would take a considerable
time for the commitments to actually translate to projects on the ground.
Mint reported on 25 December that only 9% of the commitments
made at the state’s 2012 Global Investors Meet had been realised.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
14.1. New textile scheme to generate 30 lakh jobs, ₹1-lakh cr investment
The Hindu | 30th
Dec. 2015
The Centre has stitched together an Amended Technology
Upgradation Fund Scheme (ATUFS) that will give a boost to ‘Make in India’ in
the textiles sector by attracting investments of ₹1-lakh
crore and creating over 30 lakh jobs.
The Cabinet Committee on Economic Affairs on Wednesday
approved the scheme to replace the existing Revised Restructured TUFS.
According to an official statement, “A budget provision of ₹17,822 crore has been
approved, of which ₹12,671
crore is for committed liabilities under the ongoing scheme [RR-TUFS], and ₹5,151 crore is for new cases
under ATUFS.”
The statement said with the amount provided for new
investment in 2012-17 exhausted, the Finance Ministry was approached for
enhancing the allocation.
Under the new scheme, there will be two broad categories;
one for apparel, garment and technical textiles, wherein 15 per cent subsidy
will be provided over five years on capital investment not exceeding ₹30 crore. The second category,
comprising all the other sub-sectors, will get 10 per cent subsidy, subject to
a ceiling of ₹20 crore.
The new scheme targets employment generation and export by
encouraging the apparel and garment industry. It will encourage better quality
in processing industry and check the need for import of fabrics by the garment
sector.
TXC to step up Eligible cases now pending with the Office of
Textile Commissioner (TXC) will be provided assistance under the ongoing scheme
and the new scheme given prospective effect.
The TXC is also being reorganised and its offices shall be
set up in each State. TXC officers will be closely associated with
entrepreneurs for setting up units under the new scheme, verifying assets
created jointly with the bankers and maintaining close liaison with State
government agencies.
14.2. Rio Tinto, De Beers and other global miners to trade
on Mumbai's diamond centre
Economic Times | Dec. 21, 2015
Kolkata: Rio Tinto, De Beers and Alrosa are among the major
mining companies that have decided to participate in the Indian Diamond Trading
Centre (IDTC), the special notified zone in Mumbai.
The development comes after these miners successfully
completed two test shipments at IDTC-SNZ, which became operational from Sunday.
The IDTC has been set up to do away with middlemen in
diamond trade and allow Indian manufacturers to deal directly with miners. In
the test shipment process, the miners imported test parcels of rough diamonds
from their home country to IDTC-SNZ and then sent back the parcels to their
home country. The test shipment was conducted first by British-Australian
multinational firm Rio Tinto on November 9, when it imported the parcel, and
sent it back the next day, said Praveen Shankar Pandya, chairman, Gem &
Jewellery Export Promotion Council. He said Luxembourg-headquartered De Beers
followed suit, bringing in its test parcels on November 19 and sending them
back the next day.
"Following the successful test shipments, Rio Tinto
conducted a full viewing session at IDTC-SNZ from November 21 till 25th. The
viewings received a very good response from the industry and potential buyers
lined up to attend the same," Pandya told ET.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
15.1. New Defence procurement plan to fire up local
manufacturers
The Hindu, Jan. 11, 2016 |
After a long wait, the Ministry of Defence (MoD) on Monday
unveiled the Defence Procurement Procedure (DPP) 2016, which will be effective
from March. However, the process to select strategic partners, an integral part
of the DPP, is expected to take longer.
The new policy aims at giving a boost to the Make in India
initiative, a greater role for the private sector, and a big push to the medium
and small scale sector.
Under DPP 2016, which was finalised by the Defence
Acquisition Council (DAC) chaired by Defence Minister Manohar Parrikar, the
offset level has been raised to ₹2,000
crore from ₹300 crore
currently.
“The offsets do come at a cost… anywhere between 14 and 18
per cent. Already offsets have touched $5 billion and once all the projects in
the pipeline are cleared, they will stand at $10-12 billion,” Parrikar said
while releasing the new DPP, which was sealed after a three-hour-long meeting
of the DAC.
According to sources, the Centre is worried that Indian
industry will “not be able” absorb such massive offsets; ultimately it impacts
the final product, raising the price that the Ministry has to bear.
On the selection of strategic partners, the taskforce,
constituted under former DRDO Chief VK Aatre, is yet to finalise its report,
which is expected to be submitted by January 16.
After the submission of this report, it will be included as
a separate chapter in the new DPP after the approval of the Union Cabinet. This
process can take up to eight months, sources told BusinessLine.
“Our aim is to build an indigenous ecosystem around the
strategic partners,” the Minister said, adding that the procedure to select
strategic partners will be done in a “clean and transparent” manner.
In an effort to boost the domestic defence industry, the
Centre has introduced a category for acquisition — Indigenously Designed
Developed and Manufactured (IDDM). While indigenously designed, developed and
manufactured equipment must have at least 40 per cent local components, if the
design is not Indian, 60 per cent of the components must be locally sourced.
The Minister added that certain procedures have been done
away to speed up the process of acquisition. The Centre has also made it easy
for vendors to participate in Defence deals.
In a major departure from the previous DPPs, the Modi
government sought to give more prominence to Defence firms operating in the
MSME segment. Projects that will be government funded and with estimated
development cost of less than ₹10
crore will be reserved for MSMEs.
15.2. Weapons manufacture is backbone of ‘Make in India’
programme: Modi
The Hindu, Gubbi (Tumakuru), Jan. 3, 2016 |
“Self-reliance in the area of security needs is crucial. We
have to make our own weapons and ‘Make in India’ is a step towards achieving
it,” Prime Minister Narendra Modi said.
Laying the foundation stone for HAL’s greenfield helicopter
project at Biderehalla Kaval village, near Tumakuru, Modi said: “If India has
to be self-reliant in its security requirements, our armed forces need the
latest and modern equipment. We have to make our own weapons.”
“Making weapons in India rather than importing them is our
motto and it is the backbone of our ‘Made in India’ programme.”
Modi said the country spends crores of rupees to import
defence equipment but receives relatively outdated technology and equipment.
“If we buy in 2016 we get delivery not earlier than 2020.”
“At present we import weapons from other countries to equip
our armed forces…Now, we have made it a policy that before striking a deal for
weapons, the government puts in a condition in the agreement to make a part of
the weapons in India,” he explained.
“A facility like this (HAL) will not only strengthen the
armed forces, but also realise the dreams of Babasaheb Ambedkar, who was a
champion of industrialisation,” he added.
Karnataka Chief Minister Siddaramaiah said the State has
taken steps to get the project implemented at a fast pace. Some 610 acres of
government land has been allotted and transferred at a concessional rate of ₹1 lakh an acre, he added.
Defence Minister Manohar Parikar said the HAL facility will
make helicopters for both transport and Defence needs.
HAL, he said, has set a target to manufacture 600
helicopters from this facility and as much as ₹5,000
crore will be invested, which will provide direct and indirect employment to
about 4,000 people.
- SERVICES (IT, R&D, Tourism, Healthcare, etc.)
16.1. Walmart to open stores, Micromax plans manufacturing
facility in Haryana
Economic Times | Dec. 23, 2015
Chandigarh: Wal Mart India Private Ltd president and CEO
Krish Iyer met Haryana chief minister Manohar Lal Khattar to share plans to
open its chain of stores in the state. The meeting was part of Haryana
government The meeting was part of the first Roadshow organized at New Delhi in
a run-up to 'Happening Haryana Global Investors' Summit-2016' to be organized
at Gurgaon on March 7 and 8, 2016.
During the occasion, Micromax, Co-founder Rajesh Aggarwal
today offered to set up a mobile handset manufacturing unit preferably in
National Capital Region. The unit would provide employment to 5500 youth with
initial investment ranging from Rs 100 crore to Rs 500 crore proved to be
immensely successful as far as attracting the investments in Haryana as several
prestigious multi-national and national companies expressed their willingness
to set up their ventures in the state in the field of food processing,
industrial parks, electronics, health care, civil aviation, solar energy,
warehousing and skill development. Besides it also generated a lot of hype
regarding the proposed Investors' Summit in March 2016.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
17.1. Keeping an ear out for your child (start-up)
The Hindu, Dec. 30, 2015 |
A start-up comes up with a wearable device that records
voices around a kid to identify threats and also monitors its health.
The public outcry following the rape of a six-year-old at a
Bengaluru school last July eventually died down, but it left techie Vijay
Dhuler sleepless. Four months later, he came up with a simple tech solution,
and teamed up with fellow professionals, Vinay Gundi and Sumant Nashik, to
start SafeHalo Private Ltd.
It took them 12 months to design and develop a locket-sized
child safety device that consists of a proprietary voice recorder bundled with
intelligent software. The device, which is designed to remain concealed in a
child’s attire, records ambient conversations and sounds. Once connected to a
computer, the device recognises and extracts male voices, and reduces the
recording to about 10 minutes. The device is priced at ₹3,000, inclusive of the voice analysis software
and future upgrades.
“Vinay and I have school-going daughters and were horrified
to read reports about girls being raped. Although we were running a start-up
that provides patenting services to US companies, we decided to focus our
energies on building a simple safety device for children. As parents, we owe it
to our children to keep them safe,” Dhuler, who holds 34 US patents, told
BusinessLine.
Stating that most existing safety devices depend on mobile
connectivity and the child’s action, Dhuler said: “Cell-phone connectivity is
not great in India and children are unaware of the abuse happening, making
these devices ineffective. SafeHalo takes the child out of the equation and
prevents exposure to radiation.” The device also provides emotional and health
indicators of the child based on recordings of coughs, sneezes, crying and
laughter.
Government reports reveal that 53 per cent of girl children
and 15 per cent male children are abused in India. Over 90 per cent of alleged
offenders are male.
SafeHalo is actively targeting schools, corporates and
retail customers. “We have already bagged our first customer — Infosys
Foundation — which has ordered 100 devices,” said Gundi.
An upcoming version of the device will feature image capture
and short videos and also a sensor that will detect removal of the device.
17.2. Investment in an Indian start-up every 8 hours
Business Standard, Dec. 30, 2015
Indian start-ups raised $5.5 billion (Rs 36,000 crore) from
venture capital (VC) firms and angel investors in 1,096 deals during 2015, as
they looked to participate in the country’s economic growth story, according to
VCCEdge, the research arm of online publisher VCCircle that tracks start-up
funding.
Nearly two-thirds of the investments or 632 deals were made
by angel and seed investors, pitching in with small funding in the initial
stage of the start-ups. Angel and seed investors funded $313 million in 2015.
VC investments stood at $5.18 billion in 464 deals, said the study reported on
techcircle.in. In fact, there was an investment in an Indian start-up every
eight hours. The share of private investments contributed by angel and VC firms
in India rose to 25.4 per cent in 2015, compared to 17.2 per cent during 2014.
Private equity investments in India clocked in at $11.8 billion, lower than its
peak of $12.5 billion in 2012.
A higher-than-ever number of Indian start-ups raised money
for the first time in 2015 — 695 deals involving companies that had never
raised capital before were completed this year, compared to 374 deals in 2014.
Even more interesting is the growth of the number and total deal value for
follow-on investments in 2015. There were 66 deals worth $189 million in the
year, compared to 15 deals worth $15 million in 2014, signifying that the gap
between funding rounds raised by start-ups is getting closer. Follow-on
investments are those made within a year of a company raising its initial seed
capital.
The news of healthy growth on the investment front in the
Indian startup space comes despite a funding crunch in the market, fuelled by
investors cracking the whip on startups that were burning cash to grab
eyeballs.
In October, Nikesh Arora, vice-chairman of Japese VC firm
SoftBank which has made some of the most big ticket investments in Indian
startups, warned Indian startups that they should focus on building good
products rather than funding their own growth.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
18.1. Infy lets employees ‘work from home’ for 9 days in a
month
The Hindu, Jan. 14, 2016 |
Infosys has made another set of changes to its HR policy, in
an effort to remain attractive to its employees, arrest attrition and drive
productivity.
The country’s second largest software exporter has allowed
its employees five extra days in a month, to ‘work from home'. With this,
employees can work 9 days in a month from their home, compared to 4 in the
past. Infosys HR sent an internal email to all employees a few days ago.
Considering the kind of hassle that employees go through
commuting to and fro, often travelling an average of 90 minutes one way,
employees had asked the company HR to be more flexible when it comes to its
work out of home policy. “This will also go a long way in enhancing employee
productivity as well as maintain a better work-life balance,” the note added.
Infosys is taking these measures for a couple of reasons,
opine industry watchers. The first has to do with the fact that the bulk of the
1.8 lakh employees, in their twenties are very vocal about flexibility, in the
way they work. Secondly, efforts like these will go towards curtailing
attrition, which according to Sikka has been steadily coming down since he took
over. In October, Infosys appointed Krish Shankar, a former Philips executive
as its global HR head with a mandate to handle a different kind of workforce.
Also, this development comes six months after Sikka first
announced the decision to do away with the policy of casual wear only on
Fridays. Instead, he advocated employees to flaunt their business casuals all
week.
Similarly, immediately after taking over, Sikka relaxed the
company's long-held rule that said employees needed to wear ties, after a
number of employees asked him to scrap this rule.
Attrition down
In the third quarter, attrition in Infosys came on an annual
basis came down to 13.4 per cent from 14.1 per cent in the previous quarter. On
a consolidated basis, attrition came down to 18.1 per cent from 19.9 per cent
in the September-ended quarter.
The company reported a strong set of quarterly numbers and
cheered the market by increasing FY16 revenue guidance to 12.8-13.2 per cent in
constant currency terms, and 16.2-16.6 per cent in rupee terms on December 31,
2015 exchange rates.
19.1. Microsoft CEO Satya Nadella highlights how Microsoft
could play in connecting rural India
Economic Times, Dec.29, 2015
Hyderabad: After Facebook, it's Microsoft's turn to pitch
for Digital India. During his visit to Hyderabad on Monday, Microsoft Chief
Executive Officer Satya Nadella highlighted the role the White Spaces project
by Microsoft could play in connecting rural India.
"One of the things I feel that is most important is
connectivity. So, there needs to be a market-based solution and also a local
entrepreneur that goes out and creates that last-mile connectivity that offers
affordable solutions," said Nadella during his address at T-Hub, the
Telangana state government-backed technology incubator.
Infosys CEO and MD Vishal Sikka and Keerti Melkote, founder
of Aruba Networks, which was acquired by HP earlier this year, were also
present at T-Hub.
"We are collaborating to work on the White Spaces
technology that Microsoft has been pioneering. We want to bridge the last-mile
connectivity problem, but Satya Nadella wants local entrepreneurs to come
forward and partner with Microsoft for this technology," said KT Rama Rao,
minister for information technology and Panchayati Raj for Telangana.
The pilot for White Spaces project, which utilises the
unused spectrum from television to carry low cost internet connectivity, has
been active in Srikakulam district of Andhra Pradesh.
Discussions are on between the AP State government and the
Central government to scale it up as part of the Rs 333-crore AP Fibre Grid
project for rural broadband connectivity.
During the course of a breakfast meeting with the chief
minister of Andhra Pradesh N Chandrababu Naidu, the state government requested
the Microsoft CEO to help set up a Centre of Excellence in Vishakhapatnam.
For utilisation of ICT in citizen services and drive digital
inclusion, the AP government signed a memorandum of understanding with
Microsoft India to harness Microsoft Cloud technology. According to the MoU,
Microsoft India will apply Microsoft Azure Machine Learning and Advanced Visualization
to predict and address specific problems in the fields of education,
agriculture and eCitizen services.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
19.2. Telecom sector to generate 700.000 new jobs in five
years
Economic Times, Jan. 11, 2016
New Delhi: The telecom industry is expected unlock 7 lakh
new job opportunities in the next five years, a top telecom skill development
group said in its assessment that it has submitted to national planning
committee NITI Aayog. It was an in-house study backed by telecom leaders,
Telecom Sector Skill Council (TSSC) Chief Executive Lt Gen (retired) SP Kochhar
told ET.
The council submitted findings to NITI Aayog to create
sector-friendly policies, he said. TSSC — a joint initiative of the government
and the private sector — is supported by the National Skill Development Council
(NSDC), Department of Electronics and IT (DeitY) and lobby groups such as the
Cellular Operators Association of India (COAI), Association of Unified Service
Providers Association of India (AUSPI) and Telecom and Infrastructure Providers
Association (TAIPA).
Of the total workforce in the sector, the retail and handset
segments will employ 35%, service providers 29%, network and IT vendors 18%,
telecom gear manufacturing 15% and infrastructure providers 3%, according to
its estimate. The organisation, according to Kochhar, is well-positioned to
fulfill Prime Minister Narendra Modi's ambitious vision of Digital India,
encompassing initiatives such as Make in India, Skill India and e-literacy.
Imparting skill training in villages is quite difficult,
Kochhar said, adding that as the national broadband network progresses, the
organisation will be able to impart skills with virtual teachers.
The industry, he said, is open to set up lab infrastructure
in rural India. "Recently, we have had discussions with Foxconn and it will
come on board for its skilling needs soon, TSSC top executive said. Foxconn,
the largest contract manufacturer of electronics in the world, has recently
committed $5 billion investment to set up manufacturing and R&D facilities
in India and is expected to employ 10 lakh people by 2020.
As employers increasingly want their workforce to be
skilled, the group designs syllabi in close coordination with the industry to
meet outcome oriented goals. Courses range from 120 hours to 1,050 hours.
The organisation, with its training partners, runs
programmes for new students and working people. It also offers up-skill
training and re-skilling for those who want to switch from streams. The group
also works as a jobs aggregator for the telecom industry and shared as many as
9,000 job opportunities with training partners early this month.
Kochhar said he is working on a roadmap to leverage
equipment vendors so they can earn out of idle set of equipment, which can be
put to use in training centers. The skill group is conducting a mobile
repairing pilot in villages with in-vehicle mobile labs equipped with kits and
trainers.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
20.1. A tale of two facilities and two critical cardiac
devices
The Hindu, Dec. 23, 2015 |
As rows of people sit bent over tables dressed in protective
white suits, glasses and even beard-covers, it’s business as usual at Abbott’s
Menlo Park research and production facility in the San Fransisco bay area,
California.
They are making the intricate MitraClip used to treat a
debilitating, progressive and life-threatening heart ailment (Mitral
Regurgitation), where a leaky mitral valve causes a backward flow of blood in
the heart. Left untreated, the condition raises the risk of irregular
heartbeats, stroke and heart failure.
About a seven hour drive away at another Abbott site in
Temecula, the scene is not very different. Entry here requires further
reinforced protective gear including two sets of hand-gloves and a double shoe
protection.
This facility makes drug eluting stents and Absorb, Abbott’s
breakthrough bio-absorbable stent. (A wire-like mesh, stents are inserted into
blood vessels to remove blockages, largely used in heart procedures). Unlike a
regular metal or drug-coated stent, with Absorb there is no metal left behind
in the body in three years.
But the silent activity at both facilities belies the
excitement expected around Absorb and MitraClip in 2016, in the United States
and India.
Absorb may finally become available on home-turf, the United
States, once it gets the green signal from the Food and Drug Administration,
expected in late 2016. And MitraClip expects to see more preparatory regulatory
work in India next year.
Abbott has been partnering with the Indian regulatory
authority on MitraClip since 2010 and is “currently in active negotiations with
the agency in the regulatory approval process for the novel MitraClip
technology,” says Joanna Develter, Abbott’s Vascular Regulatory Affairs
Director.
A positive development on either product will impact the
Menlo Park or Temecula facilities that supply these critical heart devices,
globally.
Keeping a close watch on these regulatory developments will
be health workers in India, as healthcare and indeed medical devices come in
for close scrutiny from a pricing viewpoint.
Science & engineering
The development of an implantable device is rigorous and
requires a different engineering to be in the body, says Jamey Jacobs,
Divisional Vice President, Research and Development (R&D), Abbott’s
vascular business. Scientists and engineers work together to combine design
with the right material, so the device can do the right thing for a long period
of time in the human body with least risk, he says.
A scientist-engineer and Director R&D (Abbott’s
Structural Heart portfolio), Santosh Prabhu explains that critical implants do
a balancing act between performance abilities, combining strength and
flexibility. The MitraClip for instance consists of 22 parts deftly put
together by machine-assisted manual operations.
Contradictory to popular perception that hi-end implants are
totally machine cut and mechanical, employees at these facilities demonstrate
how almost every operation has a manual and machine element.
“Skilled manual work is a crucial component of the
manufacturing process and the amount and capability of the workforce to build
the product is significant,” says Mike Webber, Operations In-charge at
Temecula.
Machine operations require stringent levels of manual oversight to
ensure high level of quality, he adds.
Explaining how Abbott walks the fine line between innovation
and price, Jacobs says: “We start with the goal that our products and therapies
improve outcomes and reduce healthcare costs. Ultimately the best products
should have good long-term outcomes, which reduce the need for future
procedures, interventions or visits to the doctor. When we create products like
this, the byproduct is a reduction of costs to the healthcare system through
better patient outcomes.”
India landscape
Absorb already sells in India and is priced at less than Rs.
2 lakh. About 17,000 Absorbs are estimated to have been used in India.
On MitraClip’s significance, officials expect India to show
a similar disease profile as the US where Mitral Regurgitation affects nearly
one in 10 people aged 75.
But numbers aside, MitraClip helps treat people who cannot
undertake surgery (especially the elderly), improving the quality of life in a
disease that makes daily activities difficult.
And the coming year will be significant for patient access
to MitraClip and Absorb, in India and the US, respectively.
(The writer was at the centres on invitation from the
company.)
Fact file
MitraClip is available in the US since 2013, used in about
25,000 cases globally.
Absorb is available in about 100 countries including India
(since 2012), used in 1,25,000 people across the world.
Abbott’s medical devices division clocked revenues of $ 5.4
billion (2014), and vascular accounted for close to 60 per cent.
20.2. $100-b turnover is Centre’s biotech target
The Hindu, Dec. 30, 2015
National Biotech Development Strategy lays down roadmap to
achieve the goal by 2025.
Ahead of the 103rd Indian Science Congress in Mysuru next
week, the Modi government on Wednesday unveiled the National Biotechnology Development
Strategy 2015-2020, aimed at achieving $100 billion in turnover by 2025, a more
than ten-fold rise from the current $7 billion.
Unveiling the strategy here on Wednesday, Science and
Technology Minister Harsh Vardhan said the target was “not imaginary” as the
Centre was confident that biotech had the potential to be the next boom sector.
While forging global and public-private partnerships are the
key to achieving the target, the strategy aims at establishing India as a
world-class manufacturing hub and plans to launch four major missions in
healthcare, food and nutrition, clean energy and education.
“We are likely to get a substantial increase in budgetary
allocation this year. For the first time, we have not seen any mid-term cuts
this year,” Vijay Raghavan, Secretary, Department of Biotechnology, said at the
event.
In line with ‘Make in India’ and the Indian Science
Congress’ theme of Science and Technology for Indigenous Development in India,
the biotech strategy focuses on R&D to make affordable products for the
Indian and global markets.
Technology Development and Translation networks would be set
up across India with global partners while five new clusters and 150 Technology
Transfer Organisations would come up, said Renu Swarup, Senior Advisor,
Department of Biotechnology, who played a key role in formulating the strategy.
A Life Sciences and Biotechnology Education Council would
also be established to build skilled human capital.
On the long-pending Biotechnology Regulatory Authority Bill,
Raghavan said though it was ready by the end of the UPA government’s tenure, it
had gone through modifications after extensive stakeholder discussions and
would, “hopefully”, see the light of the day soon.
INDIA & THE WORLD
Economic Times, Dec. 23, 2015
New Delhi: The bullet train deal that India and Japan signed
last week was only the first of several projects that are part of Prime
Minister Narendra Modi's innovation drive in the country and an outcome of
efforts by a core team of top officials.
Working behind the scenes to get the deal on track was the
prime minister's Empowered Committee on Innovative Collaborations, which is
taking up solar energy, industrial parks and road sector projects that use
inventive and never-tried-before technology and solutions.
The group - consisting of top officials and experts -
negotiated and crunched numbers while making a case for Japan to clinch the Rs
98,000 crore deal without a bidding process. The planned bullet train will run
between Mumbai and Ahmedabad and the 508 km rail line will be set up over the
next seven years.
The innovation committee includes Arvind Panagariya, vice
chairman of NITI Aayog, P Shankar, former central vigilance commissioner, KM
Chandrashekhar, former cabinet secretary, Amitabh Kant, secretary in the
Department of Industrial Policy & Promotion, and Shaktikanta Das, the
economic affairs secretary, railway ministry representatives and chief
secretaries of Maharashtra and Gujarat.
"We will see radical issues being taken up by this
committee in the days to come," a senior government official told ET.
The bullet train agreement signed by Modi and Japanese Prime
Minister Shinzo Abe on December 12 was the first project taken up by the
innovation committee after it was formed in October. While the committee can
consider both public and private projects in any area, several government departments
have approached it with innovative projects to get them fast-tracked.
The panel - at the reference of the ministry of road
transport & highways - is considering novel ways of getting road projects
financed such as the Swiss Challenge Method, where a bid received for a public
project or services is thrown open to third parties to match or improve.
The committee on innovation was formed keeping in mind that
government procedures can be time consuming and not always in step with rapid
pace technology advancements. It also has the power to recommend relaxation for
any proposal seeking exemption from prevailing policy or taxation regime on
considerations of employment and revenue generation opportunity and other
social and economic benefits.
All proposals will be routed through DIPP, which
will scrutinise and list pros and cons for each project.
"Japan has the largest operating system, a safety
record with no fatality since 1964 in their high-speed rail network and they
agreed to give us a highly concessional loan on easy terms," said another
senior government official involved in preparing the assessment report of the
bullet train project for the empowered committee.
The committee will meet at least once every 15 days and
advise government departments and agencies and the Foreign Investment Promotion
Board on converting concepts into implementable projects.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
22.1.
India-Africa forum Summit
Goa |
The Third India–Africa Forum Summit met in New-Delhi last
October.
The First was held in New Delhi in 2008 and the Second in the Ethiopian
capital of Addis Ababa in 2011.
These Summit meetings strengthen significantly
the multifaceted Indo – African cooperation, a development partnership based on
equality, mutual benefit and solidarity, a South-South cooperation in all its
dimensions.
Relations between India and Africa span over thousands of
years. At the dawn of history, there was migration of people from Africa to the
Mediterranean region and to Asia. This interaction led to what is known as the
“cradle of civilization”. Indians have been migrating to Africa and Africans to
India over several centuries. At present, Africa has a population of about 2.5
million people of Indian origin.
They form the connection between the two
regions and shape the economic, political and cultural foundation of an
Afro-Indian alliance. Some of the descendants of African emigrants in India are
known as Siddis. They came from Africa in the tenth century and their progeny
still lives in different parts of India, particularly in the West Coast.
Gandhiji began his struggle for freedom in Africa and India has always been in
the forefront of the movement for independence and sovereignty of the African
countries.
It was a Seminar on Portuguese Colonialism held in New Delhi
in October 1961 that triggered the decision of the Government of India to
liberate Goa. The Seminar was addressed by Prime Minister Nehru and by several
leaders of foreign countries including those from the Portuguese colonies in
Africa.
Pandit Nehru was reluctant to take any military action to liberate Goa
in view of his policy of non-violence. However, the Seminar created intense
public opinion and led to Operation Vijay on December 19, 1961 which liberated
Goa within two days without any real struggle. The Liberation of Goa provided
the impetus for the anti-colonial movements in the Portuguese territories of
Africa. Independence for these colonies came about in 1975.
In the Eighties Prime Minister Rajiv Gandhi supported the
struggle of the African countries against “apartheid” in South Africa and asked
me to visit all the border countries then known as the “Frontline States”, to
assess the situation there. I then visited the Frontline States and met the
leaders of those countries including President Samora Machel of Mozambique,
President Julius Nyerere of Tanzania, President Kenneth Kaunda of Zambia,
President Robert Mugabe of Zimbabwe, President Eduardo dos Santos of Angola,
Mr. Sam Nujoma who was not yet the President of Namibia, and other leaders.
Thereafter, Shri Rajiv Gandhi constituted the Africa Fund with contributions
from several countries but mainly from India to provide technical assistance to
the Frontline States to counter the depredations unleashed against them by the
South African regime of the time.
Countries of Africa have achieved enormous progress on the
economic and social fronts. They are growing faster than almost any other
region in the world. African rate of growth has surpassed that of East Asia.
The African Lions have now taken over from the Asian Tigers. The rate of return
on investment in Africa is currently the highest in the developing world.
Africa, in particular, and the developing countries in general, are indeed the
major engines of global economic growth at this point of time.
Four hundred
thousand new businesses were registered in Africa in 2013 and mobile telephones
reach 95 percent of the population in many places. Primary school enrolment in
Africa now exceeds 90 percent. India is a major source of business in Africa.
34 African countries enjoy duty free access to the Indian markets. In less than
a decade our trade has more than doubled to around 80 billion dollars.
One of the most significant aspects of the India -Africa
partnership has been the offer of concessional credit under the Indian
Development and Economic Assistance Scheme (IDEAS) for implementing a range of
projects as per the economic and social priorities of African countries in
areas where Indian companies have relevant expertise. In the last decade, a
total of almost US$ 9 billion in concessional credit has been approved for
nearly 140 projects in more than 40 African countries. Nearly 60 projects have
been completed across a range of sectors.
The Summit meetings have facilitated air and maritime
connectivity, more liberal visa procedures and visa concessions to enhance
tourism, trade and people to people contacts. India has committed 7.4 billion
dollars in concessional credit and 1.2 billion dollars in grants since the
first India-Africa Summit of 2008. It
is creating 100 capacity building institutions and developing
infrastructure, public transport, clean energy, irrigation, agriculture and
manufacturing capacity across Africa.
During the last three years alone nearly 25,000 young
Africans have been trained and educated in India in areas such as IT, renewable
energy, agriculture, marine and aeronautical engineering, marine hydrography,
SME entrepreneurship, rural development, parliamentary affairs, logistics and
management, climate change adaptation, disaster management, cyber security,
forensic sciences, and defense and security, among others. They are the 25,000
new links between the two regions.
Government of India will continue to facilitate the access
and enrolment of African students and academicians to India’s premier
institutions of higher learning including in areas such as engineering, medical
technology and agriculture. It will provide 50,000 scholarships over the next
five years to African students.
The India-Africa Forum Summit held last October adopted a
Framework for Strategic Cooperation and decided to establish a regular formal
monitoring mechanism to review its implementation within an agreed time frame.
The next India-Africa Forum Summit is scheduled for the year 2020.
(The writer is a former Union Minister)
22.2. Tata International plans to widen agri-business in
Africa
The Hindu, Dec.30, 2015
Tata International, the unlisted trading and distribution
arm of Tata Group, is betting big on agriculture business in Africa and
planning to set up cleaning and processing units in that continent.
The company, which has presence across 12 countries in the
Africa continent, is also looking to expand footprint to two more countries.
Nearly 18 months ago, the company through a step-down
subsidiary – Tata Africa Holdings (Tanzania) Ltd – began sourcing and exporting
commodities to countries including India, China, Myanmar and certain European
countries. “This will be one of the major growth areas for us in Africa and will
bring in additional revenues,” said Ajay Mehra, Executive Director of Tata
Africa Holdings (Tanzania), but did not reveal the expected increase in
revenues.
Now, the company intends to set up its own establishments
such as collection points across the African nations to source the farm
produces, and cleaning and processing units, ahead of the forthcoming harvest
season.
“Initially, we were buying from aggregators…. Now, we intend
to deal directly with farmers,” Mehra, who is also the country head for Tata
International in Tanzania, said.
He, however, did not provide a investments required to set
up its own establishment. The company has made a “significant” investment in
terms of working capital, personnel and infrastructure, he added.
At present, the company sources commodities such as pulses
(from Tanzania, Kenya, Malawi and Mozambique), sesame seeds (many of the
African countries including Tanzania, Nigeria, Kenya), cashew nuts (Tanzania)
and coffee (Uganda). The company has already exported about 5,000 tonnes of
pulses (thur daal, green moong and chick peas) and 1,000 tonnes of cashew.
Tata International, which also trades in chemicals,
healthcare and general trading, had posted revenues of $2.2 billion for the
financial year ended March 31, 2015.
Angola and Ethiopia
The company is also looking to expand its footprint to two
more countries – Angola and Ethiopia - in the continent.
At present, the company has presence across 12 countries
(Kenya, Tanzania, Uganda, Zambia, Malawi, Mozambique, Zimbabwe, South Africa,
Ghana, Nigeria, Ivory Coast and Senegal).
The company’s experiment ‘Grow More Pulses’ jointly with
another group company Rallis India and Selian Agricultural Research Institute
of Tanzania would benefit India, a large consumers of pulses in the world.
23.1. Altran eyes more acquisitions in India
Economic Times, Dec. 30, 2015
Mumbai: French technology firm Altran's India unit is
looking at more acquisitions in the country as it chases faster growth in
engineering services. It had earlier this year bought out SiConTech, a
Bengaluru-based company that designs semiconductor chips. Engineering services
are expected to grow faster than the rest of the IT industry, albeit from a
smaller base, sparking demand for mergers and acquisitions.
According to IT industry lobby Nasscom, engineering and
research and development services are expected to grow 1315 per cent in the
current fiscal, faster than the 12-14 per cent growth projected for the entire
IT industry.
"The sector is poised for a historic change. Non-core
engineering is beginning to be outsourced and moved offshore. It's going to be
the beginning of very explosive growth," Sanjay Kumar, CEO and MD of
Altran India told ET.
The company expects to go in for a few more buyouts to take
advantage of this growth.
"There will be more deals. To prepare for this growth,
you will have to make acquisitions because in engineering servi ces you can't
just hire a bunch of freshers and put them on projects," said Kumar.
The company plans to increase its headcount to 5,000 in the
next few years from about 1,700 at present, said Kumar. The future deals will
be with companies with a headcount roughly equal to Altran India's, he said.
The engineering services sector has witnessed more than ten
acquisitions this year as private equity firms and strategic players are
looking to boost their exposure to the market.
India-listed Cyient and privately-held Quest have made two
acquisitions each, while tech Mahindra bought Italian engineering designer
Pininfarina to boost its engineering services division this month. Harman and
Luxsoft have also made acquisitions this year.
Altran India also expects growth from the nuclear and
defence deals being signed by the government.
"We expect to get business as these deals get signed
because in some parts of nuclear, such as spent fuel disposal, we have the only
experts in the country ," said Sanjay Kumar.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
23.2. Bajaj Auto to enter 12 new export markets by March end
Livemint, Jan. 07, 2016
New Delhi: Bajaj Auto Ltd, India’s largest exporter of
motorcycles and three wheelers, will enter a dozen new export markets by end of
March, a top company official said in an interview on Tuesday.
The maker of Pulsar and Avenger motorcycle brands has
reported a decline in exports volume in the last few months because of
political and economic uncertainties in some of its export markets,
particularly in oil-producing emerging markets. Bajaj plans to maintain its
leadership in the export market by expanding into newer markets— a plan that
some analysts are skeptical about given the current stress on emerging market
economies and their currencies.
Rakesh Sharma, president of international business at Bajaj
Auto, said the company is executing an aggressive expansion plan to get into
newer countries. This, coupled with the recent market share gains, will hold
the firm in good stead and minimize the impact of any macroeconomic headwinds.
“By end of fiscal 2016, we should enter a dozen new export
markets,” said Sharma, declining to give further details. This will help the
firm report a growth of 13-15% in export volumes over the next 3-4 years, he
added.
Exports, which account for more than four out of 10
motorcycles made by the company, have been under pressure lately. In the eight
months from April to November, Bajaj’s motorcycles exports dropped 3.7% to 1.04
million units from a year earlier, according to Society of Indian Automobile
Manufacturers or Siam. Even in December, exports fell 12% to 145,000 units, Bajaj
said in a statement on 4 January.
Sharma attributed this to factors including shortage of
foreign exchange and currency devaluation in emerging markets such as Egypt and
Nigeria in Africa. Africa accounts for 45% of Bajaj Auto’s total exports. A
fall in commodity prices has led to a lower inflow of foreign currency into
these markets, which, in turn, is preventing dealers from stocking up.
The value of the currency in a number of these markets has
also fallen sharply. Currencies in Argentina, Mexico, Columbia—some of the key
markets for Bajaj—have fallen by 32%, 11%, 18%, respectively, according to
Bloomberg.
But Sharma maintains that the company has a leadership
position in most of the markets it has a presence in and this has helped the
company maintain its prices in these markets.
“Whatever work we have done in the past years in terms of
building the channel and after sales and service is paying off now,” said
Sharma adding that Bajaj Auto has managed to retain the retail price in these
markets to a great extent despite weakness in the currencies.
Analysts however, are not as bullish and expect export
volumes to remain under pressure, which will also have an adverse impact on
margins.
Considering that currencies in other emerging markets have
fallen more sharply than the Indian rupee, the benefits of a depreciated Indian
rupee will be erased for the company, said an analyst at a brokerage declining
to be identified.
The Indian rupee has weakened 5.5% against the dollar in the
nine months to December.
“Three months back, the management had guided for a 2
million export volume (including three wheelers) targets for fiscal 2016. Given
the current macro-economic scenario, they won’t be able to do more than 1.8
million units,” said the analyst cited above. While the March quarter may look
good for the company because of a low base from last year, in absolute sense,
the volumes are unlikely to advance, he added.
Nitesh Sharma, an analyst at Philip Capital India Pvt. Ltd
added that while entry into newer markets will help the firm de-risk itself
geographically, volumes will remain under pressure.
Since the start of the financial year, Bajaj Auto stock has
gained 24%, while the Sensex has slipped 8.94%. On Wednesday, Bajaj Auto fell
0.46% to Rs.2,485.50 on BSE, while the exchange’s benchmark Sensex fell 0.68%
to 25,406.33 points.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
24.1. Canada's CDPQ to open office in India
Business Standard, Jan. 14, 2016
Mumbai: Caisse de dépôt et placement du Québec (CDPQ), the
second largest pension fund in Canada after Canada Pension Plan Investment
Board (CPPIB), is looking to open an office in India to invest here directly,
said an executive aware of the fund manager’s plans.
CDPD, which manages $240 billion of depositors’ money, has
already hired some executives and is looking for properties, the executive
added. “As a large investor in major financial markets, private equity,
infrastructure and real estate, CDPD could look at similar investments here.”
CDPQ’s real estate arm, Ivanhoe Cambridge, had entered India
in 2007 and shut its office in 2011. CDPQ’s PE arm, SITQ, also shelved plans to
invest in Indian real estate as it could not find the right opportunities.
Set up in 1965, CDPQ is one of the largest institutional
fund managers in Canada and North America. A leading PE investor in Canada, it
is also one of the 10 largest real estate asset managers in the world.
A mail to CDPQ did not elicit any response.
The trend of limited partners opening their offices to
invest directly here is rising.
In October last year, CPPIB opened a 12,000-sq ft in office
at Maker Maxity in Mumbai’s Bandra Kurla Complex. A $272-billion pension fund
manager, it has already hired half a dozen full-time employees in the office.
Earlier, it had appointed Vikram Gandhi, a former New
York-based Credit Suisse executive, as an advisor for direct deal opportunities
in the country.
CPPIB started investing in India since 2010. It owns a 3.9
per cent stake in Kotak Mahindra Bank; has made $332-million investment in
L&T Infrastructure Development Projects; has a $200-million joint venture
with Shapoorji Pallonji; and has made a $300-million investment commitment with
Renuka Ramnath’s Multiples Alternate Asset Management.
A mail to the CPPIB spokesperson did not elicit response.
“CPPIB has been investing in India since 2010 and we view it
as a key growth market that aligns with our strategy of seeking investments in
markets that we believe will deliver attractive long-term, risk-adjusted
returns,” said Mark Wiseman, president and chief executive officer, CPPIB, had
said after announcing the opening of the Mumbai office in October 2015.
“The opening of an office in Mumbai allows CPPIB to develop
local expertise, build important partnerships and access investment
opportunities that may not otherwise have been available.” Wiseman added.
From the Mumbai office, CPPIB will focus primarily on
growing its portfolio in the country.
GIC, another limited partner and Singapore Government’s
sovereign fund, also has a 5,000-sq ft office in Maker Maxity, Bandra-Kurla
Complex. GIC is aggressive on India and it has done a Rs 1,992-crore deal with
DLF for residential properties. It runs a real estate NBFC with KKR, and runs
two platforms with Ascendas and Brigade for property development and investment.
Besides, GIC invests in listed securities and has made
couple of investments in e-commerce space.
“Most of the limited partners want to increase their
exposure in India given that their comfort on Russia, and Brazil is going
down,” said a senior fund manager who did not want to be quoted.
Qatar Investment Authority and Singapore’s Temasek also have
offices in India.
Another senior executive who has a joint venture with a
global fund said if limited partners directly invest in Indian assets, it would
severely impact the private equity business here. “The fund managers who are
dependent on fee from limited partners would find it difficult to raise new
funds.”
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
25.1. India-Korea Business summit: Make in India gets a leg up
from South Korean honchos
Economic Times, Jan. 15, 2016
New Delhi: Who's who of the South Korean business whose
accumulative worth is $600 bn have gathered here for the first ever mega India
Korea Business Summit on Jan 14-15 to give push to Make in India initiative by
bringing together Indian skills and the Northeast Asian country's manufacturing
capabilities.
While South Korean businesses are no strangers to India
having invested across sectors from automobiles to consumer products for the
past two decades this Summit for the first time has brought together whos who
of the Korean business world in India under one roof.
Among the big South Korean names present on the occasion are
Chung Eui-seon, Vice Chairman, Hyundai Motor Group, Park Sam-Koo, Group
Chairman, Kumho Asiana group, Park Yongmaan, CEO, Doosan Group, Shin Dong-bin,
Chairman, Lotte Group, Koo Bon-Joon, Vice Chariman of LG Electronics, Park Sang
Jin, President, Samsung Electronics, Lee Woo-Hyun, President of OCI and Bang
Sang-hoon, President & CEO of the Chosunilbo.
The Summit is being organized by Chosun Ilbo, the largest
media business group in South Korea and CII.
"The idea to organize this meet was germinated from PM
Narendra Modi's visit to Seoul last May when he addressed leadership conference
oragnaised by Chosun IIbo. The summit will serve as catalyst to push India-South
Korea business relations and take it to the next level," Woosuk Kenneth
Choi, Deputy Editor, The Chosunilbo (one of the chief organisers of the
Summit), told ET.
"India and South Korea want to grow together by
complementing each other's strength and by joining hands. India has skills and
South Korea has manufacturing experience. By merging these two qualities the
two countries can enter markets in third countries," remarked Choi.
Following flooding of markets in various countries by the cheap Chinese
products it is being felt that India and South Korea can join hands to enter
various markets.
Apart from the big names several South Korean SMEs are part
of the Summit and they plan to hold business-to-business meets with the Indian
counterparts. Besides states like Andhra Pradesh and Rajasthan are also
planning to showcase their strengths to attract South Korean investments.
Number of South Korean Parliamentarians are also attending the Summit. There
are also representations from various South Korean provinces who are exploring
partnerships with the Indian states.
India and Korea are the third and fourth largest economies
in Asia. The Comprehensive Economic Cooperation Agreement (CEPA) signed between
the two countries provides an excellent platform for expanding the bilateral
trade, which is currently below its potential, and also give great impetus for
flow of investment both ways.
The momentum created by mutual visits of Prime Minister
Narendra Modi and President Park Geun-Hye is now accelerating with commitments
from both countries to build a lasting economic relationship. Perhaps as a lead
to this new era in relationship, the Export-Import Bank of Korea is pursuing a
$10 billion plan to support infrastructure development pan India.
Disclaimer: This information has been collected through
secondary research and IBEF is not responsible for any errors in the same.
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