AAPI: May 2016

Index of this Newsletter

INDIA

INDIA & THE WORLD

21. Will protect local solar firms ‘come what may'
22. Highlight of April has been strong showing in the domestic market: S Ravikumar, Bajaj Auto
23. How India will gain from Saudi’s Vision 2030
24. Metal tycoon Gupta turns British steel saviour
25. Paytm goes global

* * *

LISBON, 20th May 2016

NEWSLETTER, 20-V-2016

INDIA

– GENERAL POLICY, INFRASTRUCTURES, COUNTRY FINANCES, etc.

1.1. Govt aims to remove poverty by 2032

Livemint | Apr. 22, 2016

New Delhi: Transforming India, an ambitious action plan finalised after two months of brainstorming

shepherded by Prime Minister Narendra Modi, has recommended a slew of reforms to be implemented by

ministries and departments if India has to grow by 10 per cent per annum until 2032. This, according to the

action plan, will totally eradicate poverty from India in the next 16 years and also create 175 million new jobs. "Growing at 10 per cent will transform India - India will be a $10 trillion economy with no poverty in 2032," the plan states. In 2015-16, the size of the Indian economy was a little over $2 trillion and the gross domestic product growth was around 7.6 per cent. As part of first steps in this grand plan, the government has set out to implement WTO-compatible procurement norms by 2017-18, achieve 100 per cent rural electrification by May 2018, increase rural teledensity to 100 per by 2020, reach broadband connectivity through optical fibre to all gram panchayats by December 2018 and have 175 million broadband connections by 2017.

The 23-page action plan also envisages reforms in the agriculture and allied sectors, including deregulation of genetically engineered (Bt) insect-resistant pulses by 2017-18, creation of buffer stock for pulses by 2017-18 and target 15 million metric tonnes of fish production by 2020. It also plans to implement seeding of Aadhaar number in 90 per cent of ration cards by the end of FY17. PAN (Permanent Account Number) is to be made mandatory for all businesses and entities and serve as unique business identifier also by the end of FY17.

"The entire process from ideation to action took barely two months," NITI Aayog Chief Executive Officer

Amitabh Kant said. The process was initiated with the PM holding a meeting with all the secretaries to the

government in December. At the meeting, Modi called for radical thinking which could take India forward,

cutting across the silos of line departments and ministries.

The PM identified eight themes and decided to constitute eight groups of secretaries to come out with

recommendations and a road map for each of the themes. The objective of the action plan was to foster

development but with inclusive growth and efficiency. According to a secretary, the PM was happy with the

finalised action plan. He told the secretaries that no expert group could have made such recommendations

because these have come from people who think the plan is doable.

However, not all agreed with the ambitious target of India achieving 10 per cent growth for the next 16 years. "While desirable, 10 per cent growth is wishful thinking when we are struggling to maintain even 7.5 per cent increase in gross domestic product per annum," a secretary, who was part of the process, said.

Kant said the recommendations by the groups of secretaries were circulated among all ministries. "Every

ministry examined it and prepared an action plan based on what can be implemented. Some of these actions were announced in the budget. The remaining we have put together in sub-themes which have target dates," Kant said. NITI Aayog has been assigned the responsibility to monitor the implementation of these action

plans and would be creating a dashboard for this.

The eight themes identified by the PM were - accelerated growth with inclusion and equity; employment

generation strategies; universal access to quality health and education; good governance; farmer-centric

Issues in agriculture and allied sectors; Swachh Bharat and Ganga Rejuvenation; energy conservation and

efficiency and innovative budgeting and effective implementation.

The government plans to have proactive consultations with the states as they "have an important role in

implementation of a number of these initiatives on pan-India basis."

CENTRE'S ACTION PLAN FOR TRANSFORMING INDIA

Seeding of Aadhaar number in 90% ration cards by March 2017
Increase rural teledensity to 100% by 2020
175 million broadband connections by 2017
Deregulation of genetically engineered (Bt) insect-resistant pulses by March 2018
WTO-compatible procurement norms by March 2018
Third-party scrutiny of road project execution agencies by end of 2016
VC funds for start-ups by end of 2016
PAN mandatory for all businesses - to serve as unique business identifier by March 2017

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

1.2. Indians' got wealthier by 400% in the last 10 years, as per report by New World Wealth

IBEF | May 11, 2016

New Delhi: The average wealth of an Indian has increased by 400 per cent during the period 2005-2015,

according to a report by New World Wealth. During the same period, the average wealth for a European

citizen decreased by 5 per cent. Other emerging countries like China and Vietnam have also witnessed growth similar to India in the average wealth of an individual. Average wealth in other developed parts of the world such as Australia and Canada has increased by 100 per cent and 50 per cent respectively during the same period.

The report considers wealth as the net assets of an individual which includes all the assets less any liabilities.

One of the major reasons for decrease in average wealth in Europe is the migration of wealthy people out of

Europe as well as the global financial crisis in 2008. Other reasons include rising income tax rates and loss of

primary jobs to emerging countries such China, India, Sri Lanka, the Philippines and Vietnam.

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

1.3. India's first national social security platform to be developed by DeitY

Economic Times | May 17, 2016

New Delhi: India's first national social security platform will be developed by the Department of Electronics

and Information Technology (DeitY), which has been entrusted with the task following the intervention of the

Prime Minister's Office to end the tug of war between three central ministries.

Officials said the PMO stepped in after the ministries of labour, finance, and communications and IT could not reach consensus on who should set up the backbone for distributing social security benefits.

"It has been decided that DeitY will use the socio-economic caste census to establish the identity of all

resident beneficiaries.

This will be seeded with Aadhaar and Jan Dhan accounts of all the beneficiaries for direct transfer of benefits as we go forward," acording to a senior official, requesting not to be identified. DeitY will develop the platform while the other ministries will use this platform to authenticate their beneficiaries, the official said.

Finance minister Arun Jaitley had in his budget speech said that the government will develop a national social

security platform for handing out monetary benefits.

Officials said that once the platform is established, beneficiaries under various schemes will have to enrol with the ministries concerned which are offering benefits under the particular schemes.

Following this, the line ministry will reach out to the national platform to authenticate the applicant and once

authenticated using Aadhaar, the benefits will be automatically transferred to the accounts of the beneficiary,

thus doing away with middlemen.

Multiple Benefits Providing social security to Indians has been one of the key focus areas of various schemes launched by the Narendra Modi-led NDA government. Most of these schemes require the beneficiary to pay a small amount as premium or contribution.

While the Jan Dhan scheme launched in 2014 aimed to provide a bank account along with a Rupay debit card to every Indian household, the Jan Suraksha Scheme launched in 2015 aimed to provide a social security net to Indians.

Under Jan Suraksha, the government brought in three schemes - Suraksha Bima Yojana providing an

accident cover, Jeevan Jyoti Bima Yojana providing a life insurance cover and the Atal Pension Yojana for old age pension.

Besides, there is a new health insurance scheme announced in this year's budget along with old age pension

scheme and widows' pension scheme that run across sectors and are administered by nodal ministries such

as finance, labour, health, education and social welfare.

In 2015-16, the government disbursed Rs 61,824 crore for 59 schemes through direct benefit transfer. Of this, Rs 16,496 crore was disbursed through Aadhaar linked bank accounts.

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

2.1. India using buying power to beat down crude oil prices

BusinessLine | Richa Mishra, Debrata Das | 15 May 2016

As one of the world’s top importers of crude oil, India is moving to take advantage of its buying clout and redoing deals to take full advantage of the shift in the global oil demand-supply situation.

The country has done this successfully with Liquefied Natural Gas. Petronet LNG Limited has signed a revised contract with RasGas for its 7.5-million-tonne per annum long-term supply agreement. The new price for the contract, effective January 1, 2016, is less than half of what RasGas was charging in 2015.

In 2015, RasGas was selling LNG at over $12/unit (gas is measured in million British thermal units). New Delhi has, with some political intervention, re-negotiated the price to less than $5 a unit, based on prevailing crude rates. Further, Petronet has also signed an agreement for additional supply of 1 mtpa of LNG from RasGas for 12 years from January 1, 2016, at the prevailing market price.

Consumer market

Speaking to BusinessLine, Dharmendra Pradhan, Minister of State (Independent Charge), Ministry of

Petroleum and Natural Gas, was emphatic that “India needs to leverage the new scenario. This is a consumer market. There is a massive change in the world oil economy.”

“Re-negotiating long-term contracts is not an easy thing. We have already taken full advantage of our longterm contract in both price and supply terms. But with the changed global dynamics we also needed to revisit our contract to ensure that it is win-win for both parties,” he said.

The Minister offered two more examples. “Post sanctions, we did a combined bargaining with Iran. We got

good terms. In Nigeria, we negotiated a term contract for the first time. Earlier, we used to get only spot purchases from there.”

Hard bargaining

“With some nations, we have renegotiated terms. We have reduced the deciding period for spot purchases. By doing this, we have already started saving. When the Saudi Crown Prince says his country should look

beyond oil, it is a big thing. We should leverage this new scenario without compromising our historic relations,” Pradhan said.

The government has also allowed public sector oil marketing companies to work out their own crude sourcing mechanism by re-doing the policy for imports. This will provide a more efficient and flexible policy for crude procurement, eventually benefiting consumers.

Policy revamp

Pradhan said “the objective of the oil marketing companies is to earn more profit so that the product price is

reduced for customers. To do that they are free to devise their own mechanism.” To ensure transparency and that there are no leakages, the policy being evolved by the PSUs has to be consistent with Central Vigilance Commission guidelines and must be approved by their boards.

2.2. Total Estimated Investment of Rs 86,000 Crores ($12,9 bn) in Renewable Energy Power Projects During Last Three Years

Press Information Bureau | May 06, 2016

New Delhi: Most of the investment in renewable energy come from private sector. Total estimated investment in renewable energy power projects during last three years is around Rs. 86,000 crore. As per inputs provided by Central Electricity Authority (CEA), around 15,400 MU has been generated through solar energy during the last three years and it has met the energy requirement to that extent in the country. This was stated by Shri Piyush Goyal, Minister of State (IC) for Power, Coal & New and Renewable Energy in a written reply to a question in the Lok Sabha today.

The Minister further stated that Government is promoting solar energy by providing fiscal and promotional

incentives such as capital and/or interest subsidy, tax holiday on the earnings for 10 years, generation based

incentive, accelerated depreciation, viability gap funding (VGF), financing solar rooftop systems as part of

home loan, concessional excise and custom duties, preferential tariff for power generation from renewables,

and foreign direct investment up to 100 per cent under the automatic route.

Under grid connected solar power schemes, the developer is decided through open and transparent bidding

system. Under off grid solar programme, organisations who are interested in working in the sector can be

empanelled as Channel Partners. The Ministry has empanelled Channel Partners for grid-connected roof-top, off-grid and solar water heater categories. The Government has revised the target of solar power from 20 GW to 100 GW by 2022. The Minister further added that however some developers are also importing solar cells, modules and other components. Technology is changing from time to time with new research. India is encouraging new and better technology.

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

3.1. Govt to invest Rs 25 lakh cr ($ 376,53 billion) in infra, says Gadkari

Business Standard | May 02, 2016

New Delhi: The government expects investments worth Rs 25 lakh crore in roads, railway and shipping

infrastructure over three years, including setting up of 27 industrial clusters at ports at around Rs 8 lakh crore, Road Transport and Highways Minister Nitin Gadkari said on Friday.

Speaking at the same event, National Highways Authority of India (NHAI) Chairman Raghav Chandra said it was planning to award projects worth Rs 11,000 crore over the next few years to enhance safety on national highways in a bid to curtail road accidents.

“The roads and highways ministry has given an in-principle approval for awarding projects worth Rs 5,000

crore every year to install safety features on highways. More than 150,000 deaths occur every year in 450,000 accidents on our roads,” Chandra said.

According to Gadkari, the government plans to spend an additional Rs 5 lakh crore on road, railway and ports connectivity projects, apart from the expenditure of Rs 8 lakh crore on 27 industrial clusters and building smart cities at ports.

The minister also announced the total award of highways projects will rise to Rs 2 lakh crore by May as compared to Rs 1.6 lakh crore at present. He added the figure would rise to Rs 5 lakh crore by May 2017. Gadkari said the pace of road construction had risen from two km (kilometre) per day in May 2014 to 20 km per day now and his ministry had ensured execution of 403 projects worth Rs 3.35 lakh crore, barring 33 projects, where work was stuck.

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

International Best Practices in Road Building">

3.2. Shri Nitin Gadkari Launches INFRACON, ePACE and up-Scaled INAM PRO: Calls Upon All Stakeholders to Use International Best Practices in Road BuildingPress Information Bureau | May 17, 2016

New Delhi: Union Minister of Road Transport & Highways and Shipping Shri Nitin Gadkari has called upon stakeholders to make conscious and active use of innovations and successful best practices from round the world in engineering and construction of roads. He said that the road transport sector in the country has

immense potential, given the high traffic density and adequate availability of resources. However, this potential cannot be realized fully unless every player in the chain of execution has a positive attitude and is ready to give up outdated practices in favour of new and efficient ones. The Minister was speaking at the Highways Sector Stakeholders Meet in New Delhi today. The meet was attended by officials of the Ministry of Road Transport & Highways, and NHIDCL, besides contractors, consultants, bankers and material suppliers concerned with road construction. Shri Gadkari further said that his Ministry had brought in many policy changes to streamline procedures and ease out road blocks like land acquisition, environment clearances and paucity of funds. Technological initiatives have also been brought in like satellite based road asset management system, use of concrete for road construction, electronic toll collection, INAMPRO other IT initiatives. All these are aimed at making the road building procedure faster, more transparent and more efficient, and all officials and other stakeholders should make maximum use of the innovations relevant to their areas of operation. Shri Gadkari also articulated his intent to build a strong system of performance audit and accountability.

Shri Gadkari also launched ePACE, INFRACON and an updated version of INAMPRO, three innovative IT initiatives of the Ministry of Road Transport & Highways, developed in house by NHIDCL( National Highways and Infrastructure Development Corporation Ltd.):

ePACE (Projects Appraisal & Continuing Enhancements) is an online integrated Management Information

System that brings projects from all wings of the Ministry under a common platform, ensuring their effective

and real time tracking. More than 2000 projects being executed by multiple agencies are currently listed on the portal and it is possible to get any information about their real time status, fund utilization etc. The portal can be freely accessed by anybody, and information regarding projects in any particular state can be found at the click of a button. The portal also allows for validation checks to prevent wrongful entries, making it difficult to fudge figures. It has provision to obtain reports in multiple formats with graphical interface for round the clock monitoring. It has also been provided with GIS interface to enable easy geo-tracking of the projects. The application has a data export engine for feeding into other applications. The architecture of the application is scalable and customizable. ePACE as a platform is amenable to be used for monitoring projects pertaining to any ministry in the country and can improve governance of such projects.

INFRACON is the National Portal for Infrastructure Consultancy Firms and Key Personnel. This portal acts as a kind of bridge between consultancy firms working in the road engineering and construction sector and domain experts and key personnel who are deployed both for project preparation and supervision. The portal hosts the credentials of consultancy firms and key personnel and has linkages to Aadhar and Digi-locker for data validation and purity. 474 consultancy firms and 2387 key personnel under various categories are already registered with the portal. In addition to this, agencies within the Ministry of Road Transport & Highways, like the NHIDCL can receive technical proposals through INFRACON. This leads to a significant reduction of paper work during bid submissions and also brings in a lot of transparency and speed since the evaluation of technical bids can be done at the click of a button.

INAM PRO has been developed as a web-based application (www.inampro.nic.in) for Infrastructure and Material Providers. It is a kind of a web based market place that brings together the material providers and the prospective buyers on a common platform. The platform was launched in March 2015 to facilitate contractors and cement buyers engaged in executing central/state funded roads and highways and bridge construction projects to place cement orders online with the registered cement companies offering cement at competitive rates in the vicinity of project execution locations. Cement companies are facilitated to update their offered stocks and the prices on the portal. They in turn get instant intimation about the orders placed and are able to approve the delivery schedules as requested by the cement buyers without hassles and delays. This is helping cement companies plan their annual production in advance and schedule deliveries with better precision.

Cement companies also have the facility to increase the cement stock offerings based on market demand and reduce prices to attract more buyers. In addition, using INAM Pro, companies are able to track orders, add more products , add cement offerings, view listed buyers, and submit their complaints or suggestions to Ministry. Similarly, buyers are able to view and track the orders placed with different companies and also submit their suggestions or complaints. With the help of INAM Pro, the Ministry of Road Transport and Highways is able to track and monitor the activities of buyers and suppliers, and remove impediments of both the parties Given the success of INAM-PRO, other materials like steel and steel slag have also been brought on this platform so as to make this as a comprehensive e-market place for infrastructure providers.

The Minister also released the IT Task Force Report on the occasion. The report has suggested many innovative ways in which IT can be used to make the working of the transport sector more efficient and transparent.

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

3.3. Ministry of Road Transport & Highways sets steep targets for 2016-17: Aims at 2.5 times increase in award and construction of National Highways

Press Information Bureau | Apr. 21, 2016

New Delhi: Minister of Road Transport & Highways Shri Nitin Gadkari has fixed a 2.5 times increase in the target for award and construction of National Highways for the year 2016-17. Encouraged by the good

performance of his Ministry in 2015-16, Shri Gadkari expressed confidence that the pace of development that was established last year will result in even better outcomes during the current year. The Minister has set a target of 25,000 km of National Highways to be awarded in 2016- 17 as against the 10,000 km awarded in 2015-16. The construction target has been set at 15,000 km as against the 6000 km constructed last year.

Of the total length of National Highways targeted for award, 15,000 km would fall under the target of National Highways Authority of India (NHAI) and 10,000 km under the target of the Ministry and National Highways and Infrastructure Development Corporation (NHIDCL). NHAI’s target for construction has been fixed at 8000 km while for the Ministry and NHIDCL, the target is 7000 km.

The year 2015-16 has been one of very positive outcomes for the Ministry of Road Transport & Highways.

Works on a length of more than 10,000 km were awarded for the very first time. The completion of

construction of 6000 km marked a year-over-year increase of nearly 36 %. The speeding up of road projects has been made possible due to several policy interventions which include the Ministry being empowered to decide mode of delivery, increased threshold for project approval, enhanced inter-ministerial coordination Exit Policy, promoting innovative project implementation models like Hybrid Annuity Model , amendments to the Model Concession Agreement (MCA) for BOT projects, segregation of Civil Cost from Capital Cost for NH projects for appraisal & approval, rationalized compensation to concessionaires for languishing NH projects in BOT mode for delays not attributable to them, delegation of powers to Chief Engineers regarding periodic renewal, delegation of powers to MORTH ROs regarding utility shifting and delegation of powers to evaluate and award tenders of upto Rs 300 cr.

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

4.1. Centre to speed up patent examination for start-ups, India first filers

Our Bureau | BusinessLine | 17 May 2016

The Centre is introducing a facility for speeding up the examination of patents for start-ups and for applicants who choose India as the competent authority for international searching or preliminary examination. While the time-line for expedited examination of patents is yet to be notified, the government has also decided to bring down the time required for grant of patents for all applicants to two-and-a-half years from five-seven years required at present.

“We are trying to bring down the total time required for grant of patents to two-and-half years, which includes 18 months for first examination report to be finalised and another year for the final grant of the patent which includes time taken by the applicant to make required changes in the application. But this is not part of the rules,” said Rajiv Aggarwal, Joint Secretary, Department of Industrial Policy and Promotion (DIPP). The introduction of expedited examination of patents is part of the Patent Amendment Rules notified on Monday.

The facility will be applicable to all new applicants who meet the stated criteria on payment of stipulated fees, but those who have already applied through the regular route cannot seek a transfer to the expedited

category.

Applicants wanting to apply through the expedited route have to either meet the criteria of a start-up or

indicate India as the competent International Searching Authority or elect it as an International Preliminary

Examining Authority.

The new rules also set a limit of two adjournments for each party in a patent related hearing with the adjournments of a maximum duration of thirty days each. “Right now there is no limit on the number of adjournments and its duration and a hearing could be stretched for days depending on the party involved. The new rules would put an end to this by setting limits,” Aggarwal said.

4.2. Rajya Sabha passes Bankruptcy Code

Economic Times | May 12, 2016

New Delhi: The Rajya Sabha on Wednesday gave its assent to the new bankruptcy code, almost a week later after it was passed by the lower house of the Parliament, clearing the law that provides for speedy resolution of bankrupt businesses.

The bill seeks to bring a host of regulatory changes to build a robust and faster insolvency resolution mechanism besides setting up of an Insolvency and Bankruptcy Board of India. Under the new code, employees and workmen will have first right during liquidation of assets under the law followed by secured creditors.

"History is written today as Rajya Sabha passes Bankruptcy Bill!," minister of state for finance Jayant Sinha,

who piloted the bill in the house, tweeted after the bill was passed late by Rajya Sabha. Insolvency and

Bankruptcy Code, 2015 had been passed by the Lok Sabha last week. The law will come into force when it receives president's assent.

The new law will provide an overarching framework for dealing with bankruptcies, replacing multiple laws

dealing with the issue, including the Companies Act. It will cover individuals, companies, limited liability

partnerships and partnership firms. "Bankruptcy code: it's a big day for economic reforms in India. The country moves ahead towards higher growth," economic affairs secretary Shaktikanta Das tweeted.

"Both Houses of Parliament passing the Bankruptcy Code.... this is huge. Combined with bank cleanup,

potential game changer in long run," economist Sanjeev Sanyal said. The bill comes amidst mounting

concerns over the non-performing loans of the state run banks.

The bankruptcy law is expected to quickly resolve bankrupt companies, protecting interest of all stakeholders. According to the government data top 50 defaulters of public sector banks had exposure in excess of Rs 1.21lakh crore as on December 2015. "Because this law ensures time bound recovery foreign lenders will be more open to lend to Indian corporates.

This will also lessen the burden on the state run lenders which are already saddled with bad loans, " said

Mohit Saraf, Sr. Partner, Luthra & Luthra. The key features of the code includes hasten debt recoveries and

restructurings by setting a deadline of 180 days to decide the fate of a company that defaults. If, however,

75% of creditors agree on a revival plan, that term can be extended by 90 days. Otherwise, a firm would be

automatically liquidated.

A debtor could be jailed for up to five years for concealing property or defrauding creditors under the new law. Bankrupt individuals would be barred from contesting elections.

The new law is also expected to improve its rankings in the World Bank's on the ease of doing business in

which India scores a poor 136 on the resolving insolvency matrix. India's overall rank is 130 and the

government wants to break into top 100 next year.

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

5.1. MoU signed between Railways and ISRO for remote sensing and geographic information system

Press Information Bureau | Apr. 28, 2016

New Delhi: Railways have recently signed Memorandum of Understanding (MoU) with Indian Space

Research Organisation (ISRO) for developing applications in the field of Remote Sensing and Geographic

Information System.

The aims and objectives of the MoU is to develop applications and services in tune with the requirements of Indian Railways such as:

- i) Develop an advance warning system at Unmanned Railway Crossings for road

users.

- ii) Mapping of Indian Railway assets through Geospatial technology.

- iii) Develop paperless

unreserved ticketing solution based on geo-fencing of station area.

- iv) Developing Real Time Train Information System by using Communication Satellite Services.

- v) Setting up of “BHUVAN” node in Indian Railways to internalize the use of BHUVAN geospatial solutions by Railways.

- vi) Meet Indian Railways satellite based communication requirements.

- vii) The MoU has been signed on March 17th, 2016 and has come into force.

For services being currently provided by BHUVAN or envisaged in future for Government of India, no charges shall be levied. For communication services, satellite assisted Navigation etc. charges would be applicable as per mutual agreement and based on pricing policies of the Government.

A project called Real-time Train Information System (RTIS) to track trains on real time basis along with dissemination of train running information to rail users has been sanctioned. This Press Release based on information given by the Minister of State for Railways Shri Manoj Sinha in a written reply to a question in Lok Sabha on 27.04.2016 (Wednesday).

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

5.2. Railways gets on the infotech track

Our Bureau | BusinessLine | 15 May, 2016

It is being touted as the mother of all IT projects. Indian Railways has embarked on a project to integrate its

operations using enterprise resource planning (ERP) in order to synergise them and save on costs.

Announcing the project at an event for micro, small and medium enterprises in the IT sector, Railway Minister Suresh Prabhu said: “The whole idea is to integrate everything, to bring together the possibility of operational convergence through ERP. In the next few years, Indian Railways will transform, save costs, bring in efficiency and increase transparency.”

“I was talking to the Managing Director of Tata Consultancy Services and he felt this could be the largest IT

programme anywhere in the world. That’s what we are trying to work on,” Prabhu added.

An IT vision for the Railways has already been formulated by a panel led by former Nasscom Chairman Som Mittal. Prabhu said that use of digital technology was not a choice but a compulsion as it was imperative to use technology to fine-tune operations by integrating it to the Railways’ mainstream activities.

Two Apps

The Railways is at an advanced stage of unveiling two mobile applications — one to integrate all ticketing

related activities and the other to integrate all non-ticketing related functions, including managing accounts,

HR, train operations, freight yards, wagon booking, freight booking, locomotives, coaches, tendering for

vendors, sale of scrap, and awarding works contracts.

The Railways has also signed a memorandum of understanding with the Indian Space Research Organisation (ISRO) for development of applications in the field of Remote Sensing and a Geographic Information System.

The MoU aims to develop applications such as an advance warning system at Unmanned Railway Crossings

for road users, mapping of the Railways’ assets through Geospatial technology, developing a paperless

unreserved ticketing solution based on geo-fencing of the station area, as well as a real-time Train Information System using Communication Satellite Services.

The Railways has also introduced a facility to cancel tickets bought over the counter using mobile phones.

A mobile-based real-time system for handling passenger complaints along with social media integration

(Facebook and Twitter) is also being fine tuned. Apps for women in distress are also being developed.

Analytics-based decisions

A special cross functional team is analysing the over 100 Terabytes (1 Terabyte= 1,000 GB) of data that the Railways generates in a year.

“We are working on a start-up programme and have allocated ₹50 crore for it in the budget. Any new innovation which comes in, we will mentor it, anchor it and take it to the marketplace as a proprietary

technology of the person who develops it,” said Prabhu.

– AGRICULTURE, FISHING & RURAL DEVELOPMENT

6.1. Lenskart raises ₹400 crore from IFC, Ratan Tata

Our Bureau | BusinessLine | 4 May 2016

Online eyewear seller Lenskart has raised about ₹400 crore ($60 million) in Series D from a group of investors led by IFC, an arm of the World Bank.

While IFC has invested ₹171 crore in the Delhi-based firm, other marquee investors who also participated in the current round were IDG Ventures, TPG Growth and Adveq Management. In addition, Ratan Tata and Kris Gopalakrishnan (co-founder of Infosys) invested in their personal capacity.

With the current round, Lenskart’s total funding stands at $95 million (₹640 crore, approximately) and is valued at ₹1,200 crore, according to industry experts. Ronnie Screwvala’s Unilazer Ventures is also an investor in the company.

Lenskart, which started as an online player in 2010, has over the past few years adopted an omni-channel

way to expand its business. At present, it has over 100 stores across more than 65 cities and sells over

10,000 different styles of eyewear across brands.

“IFC is a long-term partner with global knowledge and a broad network of Internet, technology and healthcare clients, including in the eye-care space.

We will be able to draw on IFC’s extensive global experience in the healthcare and manufacturing sectors,

particularly in supply chain development and capacity building,” said Peyush Bansal, Founder and CEO of

Lenskart.

Expansion plans

Lenskart will use the investment to widen its retail channel and expand its manufacturing unit near Okhla in Delhi for its own brand and also set up a new one.

6.2. India is largest producer of coir in the world

Press Information Bureau | May 06, 2016

New Delhi: India is the largest producer of coir in the world with a production of 5,42,000 MT which comes to around 55% of world production of coir. India is followed by Sri Lanka and Vietnam in terms of production of coir.

Government of India is implementing various Schemes for promotion of coir in the country and to enhance the production and export of coir and coir products. The Schemes are Coir Udhyami Yojana, Science &

Technology and Coir Vikas Yojana comprising of components like Skill Upgradation, Quality Improvement

Scheme and Mahila Coir Yojana, Export Market Promotion & Domestic Market Promotion. Government is also implementing the Scheme of Funds for Regeneration of Traditional Industries(SFURTI) for development of Coir Clusters. Under the ASPIRE Scheme of the Ministry of Micro, Small and Medium Enterprises (MSME), Coir Board is in the process of establishing Livelihood Incubation Centres in various parts of the country, which will provide training and handholding support to new entrepreneurs of coir sector.

The thrust of Government has been to promote production of coir in the non-traditional States for which Coir Board has recently opened offices in Sindhudurg in Maharashtra, Kavaratti in Lakshadweep and Port Blair in Andaman & Nicobar Islands. In addition, Government through Coir Board has been focusing on production of value added products to cater to domestic as well as foreign markets.

This information was given by the Minister of State, Micro, Small and Medium Enterprises, Shri Giriraj Singh in a written reply to a question in Rajya Sabha here today.

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

7.1. Nestle India re-launches Atta and Oats variants of Maggi

Our Bureau | BusinessLine | 19 Apr. 2016

Nestle India said its instant-noodle brand Maggi has now gained more than 50 per cent market share in the

category, based on a Nielsen report. The company also said that it is re-launching its two variants — Maggi

Vegetable Atta Noodles and Maggi Oats Noodles.

The company had last year embarked reviving the brand with the launch of the Masala variant in November

after the brand was hit by the food safety controversy.

Suresh Narayanan, Chairman and Managing Director, Nestlé India, said that the company has further strengthened its leadership position and has gained month on month.

“We continue to lead the noodles category with over 50 per cent market share. We understand the changing

lifestyles of generations and have constantly innovated products that add value to the favourite Maggi Noodles. With the latest re-launch, we are aiming to provide more choices to suit consumer preferences, driving greater volumes and building back our market share,” he said.

The Vegetable Atta and Oats variants are available at ₹20 for a 80 gm pack and ₹25 for a 73 gm pack, respectively.

The company said that it is partnering with Snapdeal for an exclusive preview sale. “A ‘Special Kit’, at an

attractive price of ₹176, consisting of four packs each of Vegetable Atta and Oats Noodles and two Maggi

bowls in red and yellow colours, are being offered to consumers as part of the preview sale starting April 22,” the company said in a statement.

7.2. Walmart India awaits FDI policy guidelines for marketing food products

BusinessLine | Meenakshi Verma Ambwani | 27 Apr. 2016

Walmart India has said that it is willing to evaluate its options of food retail in the country once clarity on FDI policy guidelines on marketing of food products domestically produced emerges.

Speaking at the sidelines of the launch of Walmart India’s programme for women entrepreneurship development, Krish Iyer, President and CEO Walmart India, said: “It (FDI) is a progressive step. I think bringing in more retailers into food retail will eventually benefit the farmers in terms of better realisation and getting technical inputs. It will also benefit the customers in terms of lower prices. As far as we are concerned, we are waiting for the policy guidelines and will evaluate and study the policy. We will take appropriate decisions at the appropriate time.”

Replying to a query on pure play food and grocery retail concepts, he said many retailers have food and

grocery formats around the world and this is an interesting development in the Indian context.

The company currently operates 21 Best Price Modern Wholesale stores in nine States. It is now looking to expand to other States such as Haryana and Karnataka as it has plans to open 49 additional stores by 2020. “We are on track with our plans. It takes a minimum of 30 months to open a store depending on how fast one gets approvals and whether the construction is on time …among other factors. The pipeline building process is on and we have a healthy pipeline,” he said.

The company, which opened its 21st store in Agra in 2015, will open its next store in the fourth quarter of next year. Iyer added that the company will continue to focus on its B2B e-commerce platform. Walmart India has also been receiving membership requests from e-commerce players and said it is processing these requests.

Walmart India on Wednesday launched its entrepreneurship development programme for women-owned

businesses with the first batch of 32 women entrepreneurs, which is being implemented in collaboration with

WEConnect and Vrutti.

Iyer said, “This initiative is designed to help women entrepreneurs achieve higher levels of business growth

and help make them more competitive in today’s dynamic business environment. We hope this will create a

pipeline of women suppliers for the industry as well as for Walmart India.”

8.1. Govt sets up panel to lay out plan for doubling farm incomes

Livemint | Apr. 22, 2016

New Delhi: The central government has set up a panel to suggest ways to double farm incomes by 2022, as promised by Prime Minister Narendra Modi.

The task of the inter-ministerial committee will prepare a blueprint to transition farm policies from being

production oriented to based on incomes or value addition.

The committee will look into ways to examine the potential of Indian agriculture and where investments are

required, and will identify segments with potential for growth, said an official with the agriculture ministry aware of the development, on condition of anonymity.

He added that the guiding principle for the committee would be to diversify risks in farming and chalk out ways in which integrated farming—foodgrains, horticulture and allied activities like livestock and fisheries—can boost farm incomes.

“The goal to double incomes is a good dream of the prime minister but the task is herculean... to begin with

the government needs to decide whether they are talking about real or nominal incomes,” said Ashok Gulati,

agriculture chair professor at the Delhi-based Indian Council for Research in International Economic Relations.

“If the goal is to double nominal incomes the (previous) United Progressive Alliance government did it in five

years between 2009-10 to 2013-14. Doubling real incomes by 2022 will require the farm sector to grow at an annual rate of 10%, compared to a growth rate of less than 0.5% in the last two years,” Gulati said.

The inter-ministerial committee, which is expected to submit its recommendations in two months, will be

headed by Ashok Dalwai, additional secretary at the agriculture ministry, and will have officials from the

marketing, crops and horticulture divisions of the ministry as members.

The other members are officials from the food processing ministry and experts from the Delhi-based National

Council of Applied Economic Research and National Institute of Agricultural Economics and Policy Research. “The centre is trying to address the unpredictability in agriculture due to market or price fluctuations, and due to weather,” said the agriculture ministry official cited earlier. “We have already taken important steps like setting up an electronic National Agriculture Market and rolling out a new crop insurance scheme.”

He further said the focus will not be limited to enhancing productivity but also include reducing costs of cultivation through judicious use of fertilizers and increasing access to irrigation. The central government’s decision to set up the committee follows the budget announcement that set a goal of doubling farm incomes by 2022.

Prime Minister Modi also suggested a seven-point strategy to double farm incomes while speaking at the Bloomberg India Economic Forum last month. The focus areas, according to Modi, could be large investments in irrigation, quality seeds, soil health, cold chain and warehousing to prevent losses, value addition through food processing, creation of a pan-India national market for farm produce, and risk mitigation through crop insurance and diversifying into areas like poultry, bee keeping and fisheries.

The National Democratic Alliance government is trying to revive agricultural growth and income, following

back-to-back deficit monsoons in 2014 and 2015. While agriculture growth contracted by 0.2% in 2014-15 from 4.2% in the previous year, farm incomes also took a hit because of lower production and a drop in prices of key crops such as rice, wheat and cotton. As many as eleven states declared a drought in 2015, highlighting the critical role of the monsoon for Indian agriculture and rural demand.

To address ongoing farm distress, the Union budget in February increased allocation for crop insurance and

irrigation schemes. Last week, the centre launched an electronic National Agriculture Market, or e-NAM, that will connect 21 mandis from eight states in the first phase. The centre aims to bring 585 mandis across India on to the platform by March 2018.

The Economic Survey released in February said the average annual income of the median farmer, net of

production costs, from cultivation is less than Rs.20,000 in 17 states.

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

8.2. The big story: The swing factor in GDP growth

BusinessLine |Aarati Krishnan | 2 May 2016

Are India’s monsoon rains critical to its stock markets? One would certainly think so, from the 1,000-point rally in the BSE Sensex after the IMD forecast an above-normal monsoon for 2016 on April 12. But is this just a knee-jerk reaction or do rains really make a difference to economic growth, rural consumption and inflation — the parameters that matter to India Inc? We took a hard look at the empirical data from 2000 to 2016, to find out.

Kicker to economic growth

If there’s one segment of the economy that the monsoons have a direct impact on, it is agricultural output. So, mapping monsoon performance to growth in the agriculture component of GDP, it is clear that the quantum of annual rainfall does have a direct impact on agri GDP growth.

In the last 15 years, India has had three drought years — 2002, 2009 and 2015, when annual rainfall was 15- 20 per cent below par and all of them saw sluggish agri output. In FY03, agri GDP contracted by 6.6 per cent, in FY10, it expanded by 0.8 per cent and for FY16 we are staring at a tiny 1.1 per cent growth. Years of bountiful monsoons such as 2003, 2005 and 2010 have also seen agri GDP expanding by leaps and bounds. However, what has changed over the years is the difference that agriculture can make to the overall GDP number. If the farm economy chipped in with 30 per cent of overall output in the nineties, its current contribution is just 17 per cent.

But having said this, in the slow-growth environment that we live in, even small contributions are welcome.

Agriculture has, in fact, been a ‘swing factor’ in the overall GDP numbers in the last couple of years. In 2015- 16, Indian industry grew by 7.3 per cent and services by a healthy 9.2 per cent. But it was the tepid show by agriculture (1.1 per cent) that kept GDP growth at sub-8 per cent.

So, if the 2016 monsoons do turn out to be bountiful and agri growth rebounds to 4-5 per cent levels (the base effect will help too), that could mean a direct kicker of 0.60 to 0.75 percentage points to the GDP.

Trends in consumption

But it would be short-sighted to think that the monsoon’s impact on the economy is restricted to such direct

effects alone. Let’s not forget that the Indian economy leans quite heavily on its consumers to power it private consumption drives over 55 per cent of GDP).

Agriculture provides employment to about 49 per cent of the Indian population and this is probably why rural consumers account for about 45 per cent of domestic FMCG sales and 25 per cent of consumer durable sales in the country.

Tracing trends in consumption growth relative to monsoons, the trends are unexpected. Drought years have

not always led to poor consumption, but good monsoon years have always led to a bump-up in consumer

spending! The drought year of 2002 saw a distinct cutback in the country’s consumption (measured by Private Final Consumption Expenditure or PFCE). The drought years of 2009 and 2015, however, saw healthy consumption growth.

While this may appear counter-intuitive, it is easily explained. Farmers’ incomes in any given year are made up of a combination of their actual produce, multiplied by the prices they realise. Even when poor rains shrink their output, farm incomes may still turn out healthy if crop prices are holding high.

This was indeed the case in the years from 2008 to 2013. Thanks to sharp increases in the minimum support

prices of major crops from the UPA-led government and a global commodity rally, farm incomes were growing at a healthy clip.

Production data on consumer products favoured by rural consumers (two-wheelers, tractors, fertilisers) shows that sales of these products fell sharply in the drought year of 2002, but in 2009, they all managed healthy double-digit growth. The only credible explanation for this is that, sky-high food inflation (15 per cent) ensured reasonably good income levels. Stimulus measures rolled out by the government (post-global crisis) and high MGNREGA spends are also likely to have buoyed up rural incomes.

This also explains why 2015 has been such a lacklustre year for rural FMCG products, two-wheelers, tractors and agri inputs. With global agri prices melting and the Centre making concerted efforts to crack down on inflation since 2014, rural incomes have faced the double whammy of lower output and low prices. Welfare giveaways under Central schemes have also been cut back.

This suggests that for rural consumption to rebound in 2016, what India needs is not just a good monsoon (which will raise farm output) but also a rebound in agri and food product prices (which will help realisations). It is still early days to call a rebound in global commodity prices.

But going by the agri-centric Budget, the Centre seems to be coming alive to rural distress by stepping up rural infrastructure spending. Therefore, one can probably expect some easing of the pressure on rural incomes in 2016. But going back to the heydays of 2008-2013 will be difficult.

Tenuous link with inflation

Unlike the other two factors, the link between monsoons and domestic inflation rates is quite tenuous. In the

drought years of 2002 and 2015, all three key inflation indicators — the CPI, WPI and food inflation — were down in the dumps. On the contrary, 2003 and 2010-11 actually saw good rains marching hand in hand with elevated inflation rates. Despite 2014 and 2015 seeing consecutive years of deficient rains, inflationary pressure was at a multi-year low.

The month-wise and spatial distribution of rains may decide whether individual commodities like pulses, see a spike in prices in 2016 (See accompanying story). But the performance of the global commodity cycle and

domestic policy actions (on MSP and money supply) may hold far greater influence on overall inflation rates, than the monsoons, per se.

So, yes, the market is right. A bountiful monsoon will mean better growth and a consumption kicker to India Inc.

9.1. Mondelez inaugurates seventh plant in India

Business Standard | Apr. 26, 2016

New Delhi: Mondelez, best known for its Cadbury chocolates, on Monday inaugurated a Rs 1,265-crore plant in Tada, SriCity, Andhra Pradesh, making it the company’s seventh manufacturing unit in the country.

This was the company’s largest plant in the Asia-Pacific region and would cater to domestic and regional needs, executives said.

Mondelez looks at India as a regional hub, with the plant capable of multiple products. The plant would initially produce chocolates and eventually other foods, said Daniel Myres, executive vice-president, integrated supply chain, Mondelez International.

The plant's capacity is 250,000 tonnes a year, which the company hopes to touch by 2020. The total

investment is expected to reach Rs 2,300 crore by then. Mondelez has invested Rs 670 crore in its six other plants in the country: two in Maharashtra, two in Himachal Pradesh and one each in Madhya Pradesh and Andhra Pradesh. “Mondelez International is putting its resources behind its commitment to this country, not only through its investment, but also behind its brands, route to market and talent,” said Maurizio Brusadelli, president, Asia-Pacific.

In the past few years, packaged food companies like Kellogg’s, Mars, Cargill, Coca-Cola and PepsiCo have made significant investments in India. Data sourced from the department of industrial policy and promotion shows yearly foreign direct investment in food processing has been consistently above Rs 2,000 crore, pointing to growing corporate interest in the sector. Domestic players like ITC and Britannia are also betting highly on packaged foods.

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

9.2. ₹30-cr Series B to juice up RAW Pressery expansion

BusinessLine | M Somasekhar | 24 Apr.2016

Cold-pressed fresh juice company RAW Pressery will launch its largest plant in Mumbai in mid-May, according to founder Managing Director Anuj Rakyan.

The Mumbai-based company, which produces a range of high nutrition juices, also plans to reach out to 1,500 points of sale by the end of this fiscal, from 450 at present.

Armed with a recent ₹30-crore Series B funding from Sequoia India, Saama Capital and DSG Partners, the

company expects to strengthen its management team and step up brand building and digital marketing exercises, along with expanding its capacity increasing the range of flavours, Anuj told BusinessLine.

Quality-centered

“We position ourselves as a fruit and vegetables company and not a beverages firm. We work closely with the growers to ensure quality; have contracts for buy-back and also extend financial help. In addition, we have the necessary certifications in place,” he said.

The clean label company, with a production plant in Thane, near Mumbai, has entered Hyderabad with trade retail outlets. It plans to enter the direct home delivery and corporate segments by mid-June in the city. It will add eight juices and smoothies to its range and expand to 12 cities by end of the year, from seven at present.

Anuj said the company’s prime target groups are 18-49-year-olds, urban, health conscious people on the

move. It is eyeing a 300 per cent growth in turnover this fiscal, from ₹7.5 crore last year. What’s fuelling the confidence is a perceptible preference shift from carbonated drinks, growth in health consciousness and the product’s stated advantages of being nutritious with no added sugars, chemicals, preservatives, etc. It is also an early entrant in the sector.

9.3. Food sector will get foreign investment only if FDI is allowed unconditionally: Report

BusinessLine | 27 Apr. 2016

The food supply chain sector will not get the desired foreign investments unless foreign direct investment (FDI) is allowed in multi-brand retail and rigid conditions removed, according to a report by research body ICRIER and D&B Tangram.

“It is important for the government to know that global retailers cannot change their business models to meet the conditions imposed on FDI in retail. As India competes with other countries to get FDI it should also have similar FDI policies. The retail policy should not impose restrictions on store and non-store retail formats,” the report on ‘India-UK collaborations and investments in food supply chain — opportunities and challenges’released on Wednesday said.

Some of the UK-based food manufacturers have or are planning to set up manufacturing hubs in the ASEAN countries such as Thailand and export the products to India at low import duties through the ASEAN free trade agreement (FTA), the report cautioned.

Finance Minister Arun Jaitley announced the Centre’s intention to allow FDI in the food processing sector earlier this year, but it would be subject to the condition that a company source all its inputs locally. The BJP-government is, so far, opposed to allowing FDI in multi-brand retail, while 100 per cent FDI is allowed in single-brand retail subject to domestic sourcing conditions.

For the food supply sector, taxation is a major concern. “Rolling out of the Goods & Services Tax (GST) is further expected to drive technology adoption since the hub-and-spoke model technology will be of paramount importance,” the report points out.

It suggested that if GST does not happen due to the lack of a majority in the Upper House of Parliament, the Centre could work with the states in which it has a majority, such as Gujarat, Rajasthan, Haryana and

Maharashtra, to establish green channels. This will significantly benefit movement of perishable produce and reduce wastage.

The study focuses on five areas of the food supply chain — storage and warehousing, cold-chains, packaging technology, skill development and R&D. Food and drink is a priority sector for the UK government in its trade and investment with India. The report charts out clear action points for UK Trade & Invest (UKTI) and the UK India Business Council (UKIBC) to increase awareness and market understanding of UK companies and to work collaboratively with the Centre and state governments in India to enhance India-UK trade and investment in the food supply chain.

– INDUSTRY, MANUFACTURE

10.1. 20 years in India: Hyundai vows to emerge a trusted brand

Our Bureau | BusinessLine | 6 May 2016

Hyundai Motor India Ltd (HMIL), which is celebrating 20 years of operations here, said it will strengthen its

presence in the emerging and new segments of passenger vehicle (PV) market.

Hyundai Motor is preparing to roll out a hybrid car, introduce variants powered by new AMT (automatic manual transmission) technology and a sub-4 metre compact SUV.

These are in addition to the two new products the company aims to introduce every year. While HMIL, the second largest passenger vehicle manufacturer after Maruti Suzuki, has 10 models now, it aims to launch at least two-three more all-new models to fill the gaps and strengthen its presence.

“The new hybrid car may come at the right time in the mid-segment, while a compact SUV will be rolled out in a couple of year’s time,” said YK Koo, Managing Director & CEO, HMIL at its factory near Chennai.

He elaborated that India government’s push towards green mobility and improving eco system was spurring the opportunity to look at launching a hybrid car in the Indian market.

New SUV model

Enthused by robust response to its SUV Creta, the company will strengthen its presence in the compact SUV segment with a new model.

“Share of compact SUVs continues to grow in the overall UV market and it accounts for about 60 per cent of the total UV volumes. The segment will continue to record higher growth than other categories due to changing buyer preferences,” he added.

The company also sees growing preference for AMT variants in the country. With a new AMT technology,

Hyundai wants to catch up with competition and grow the sales.

It is also preparing to ramp up the production of Creta to take advantage of the strong demand for its compact SUV. “It is definitely a perfect SUV for the Indian buyers, while it has been well-received in all BRICS markets too. With the proposed capacity increase from June, the waiting period for Creta will come down from 4-5 months to 2-2.5 months,” Koo said.

He also stated that the Supreme Court ban on large diesel cars was impacting the sales of other diesel models too. But, Hyundai does not expect any major dent in its sales.

The company has seen its domestic sales grow by eight per cent at 1.62 lakh units during the first four months of this calendar year when compared with a year ago period.

It says it has increased market share by 100 basis points to 16.9 per cent during the period.

Export hub

Koo said the Indian arm contributed 13 per cent to Hyundai Motor Corporation (HMC) by volume and was functioning as a strong global production and export hub for small cars for HMC, exporting to 92 countries. Beginning with just 20 cars in 1999, the company has exported over 23 lakh cars out of India till March 31, 2016.

He also said the company had set out a vision for the next two decades and that includes achieving market

leadership, becoming a trusted brand, emerging as a modern premium brand in the mass segment and becoming a great place to work.

HMIL has set a target to sell 6.65 lakh units in 2016 against 6.43 lakh units in 2015. Of the total number, it aims to sell about five lakh units in India, while the rest will be exported.

10.2. Ford Motor eyes new global technology centre in Chennai

Business Standard | May 12, 2016

Chennai: Following the footsteps of Nissan, Mahindra and other original equipment manufacturers (OEMs), Ford Motor is planning to set up a new global technology and business centre in Chennai. It would be spread across 28 acres housing a R&D and product testing centre. The firm has invested around $2 billion in India. While industry sources said the investment would be around Rs 2,500 crore, Ford's spokesperson refused to share details.

In an e-mail, the spokesperson said, "We would share details of the engagement at an appropriate time and

add nothing to the speculations of investment figures". Ford already has an investment to the tune of $2 billion in India.

The firm's proposal got a nod from the Board of Approvals for special economic zones (SEZs) under the Ministry of Commerce recently. According to the proposal, Ford Motor will be a co-developer in the sector specific SEZ of information technology/information technology enabled service (IT/ITES) at Sholinganallur village in Tamil Nadu, developed by Electronics Corporation of Tamil Nadu (ELCOT).

The company is expected to take up IT/ITES services related to automotive finance and allied sectors including setting up of the centre. The centre will host operations of Ford Global Business Services in areas of IT, product engineering, finance and accounting and data Analytics.

It has set up its first manufacturing unit at Chennai spread across 300 acres.

It has an installed annual capacity to produce 200,000 vehicles and 340,000 engines.

In March 2015, the firm expanded its manufacturing presence and inaugurated the latest integrated vehicle

assembly and engine manufacturing plant in Sanand, Gujarat, with an investment of $1 billion. Vehicles and engines made at these two plants are exported to as many as 50 countries across the globe.

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

11.1. Look beyond the factory gate: Mahindra

BusinessLine | Murali Gopalan | 22 Apr. 2016

The topic of mobility solutions is close to Anand Mahindra’s heart and puts in context the recent debut of the e20 in London.

This event took place barely a fortnight after the high-profile launch of the Model 3 from Tesla Motors, which put the spotlight on electric cars all over again. It is a space that the Chairman of the Mahindra Group is especially upbeat about since his company acquired Reva Electric Car Company in 2010.

Yet, electric mobility is still at a nascent stage even as Tesla, BMW, Mahindra & Mahindra, Nissan and a host of others do their bit to promote the cause of clean air.

Branding is key

“Branding in electric mobility is critical but I think what Tesla has also demonstrated is that you can build new brands,” Mahindra told BusinessLine at the launch of the e20. “If you do the right thing in the space you are in, there is nothing that can prevent you from becoming a big and influential brand much faster than what one would have imagined,” he added.

Since the time M&M made its intent known with the Scorpio over 15 years ago, it has decided to expand its portfolio of mobility solutions. Today, these extend from two-wheelers to trucks even while SUVs remain its core focus area.

Mahindra believes a large basket is the need of the hour, especially when transport dynamics are changing

rapidly. For instance, ownership of cars is no longer a fashionable pastime with the Ubers and Olas now offering customers a far more affordable commuting alternative. Despite these changes, Mahindra said it was practically impossible to predict what the future landscape would look like. “If I knew what the challenges were, that would mean I would know the trajectory for mobility solutions. It is such an uncertain universe out there that you have to create what I call real options and develop capabilities that will enable you to deal with an environment that will change anyway,” he said.

Hence, while there is no telling how long fossil fuels will continue to be relevant or if electric cars will gain traction in the coming years, the bigger job on hand is to be prepared for change. “I do believe it is important to be future-ready with a portfolio to be able to deal with however the market evolves. This is better than just forecasting accurately — having the weapons ready to deal with the uncertainties,” said Mahindra. This is where the company’s bouquet of mobility solutions is “one of the weapons in the armoury” and among the competencies being developed to stay ahead of the curve. In addition, products like the e20 will help in redefining the M&M brand and helping it become more modern.

Big changes coming

Mahindra sees a “major renaissance” of the automotive industry coming up — new fuels and technology and

interesting changes in mobility solutions. The way in which cars are designed, manufactured and stored will

also change dramatically.

In his view, companies have to look beyond the factory or dealer gate, not assume that is where they end their activity. “There are new ways in which cars will be used and sold and companies are going to look at how they value-add and forward integrate,” he said.

11.2. Isuzu commissions new vehicle factory in Sri City

Our Bureau | BusinessLine | 27 Apr. 2016

Japanese automobile manufacturer Isuzu launched its new factory in Andhra Pradesh paving the way for it to

carve a niche in the Indian light commercial vehicle (LCV) and utility vehicle (UV) markets. The new production unit, which was inaugurated by Andhra Pradesh Chief Minister N Chandrababu Naidu, has come up on a 107-acre site at Sri City, a multi-product SEZ located 60 km to the north of Chennai.

The factory will generate jobs for around 2,000-3,000 people and the company has earmarked ₹3,000 crore investment over three to five year period.

The factory, which will initially have an annual capacity of 50,000 units can be scaled up to 120,000 units, will produce Isuzu’s soon-to-be-rolled out D-Max V-Cross, an Adventure Utility Vehicle, and new variants of its pick-up truck brand D-Max.

Both the vehicles will come with about 70 per cent localisation as the company roped in about 150 suppliers in a bid to be cost-competitive in the Indian market.

The D-Max V-Cross, which will be powered by 2500 cc diesel engine, seeks to create its own set of customers in the UV segment.

But, the company will be marketing the new UV at a time when higher power diesel vehicles are increasingly

getting caught in pollution-related hurdles.

In the NCR, for instance, the Supreme Court has banned sale of passenger vehicles powered by diesel

engines of two litres and more till April 30.Isuzu is a pioneer in diesel engines and all its vehicles are powered by diesel engines only.

Masanori Katayama, President, Isuzu Motors Ltd, pointed out that there is a wrong notion that diesel technology is bad for environment. “The diesel technology offers 25-30 per cent better fuel efficiency than petrol,” he said. The same point was mentioned earlier by the Ambassador of Japan to India, Kenji Hiramatsu, at the inauguration.

Isuzu is preparing to roll out D-Max V-Cross priced at about ₹15 lakh and D-Max pick up trucks, which will come in two and four-door options, over the next two quarters.

Pick ups will target niche applications in the sub-3.5 tonne of small commercial vehicle category.

Meanwhile, Isuzu will keep its contract manufacturing operations at Thiruvallur, near Chennai, going and will

continue to assemble its premium SUV MU-7 there. Naohiro Yamaguchi, President and Managing Director, Isuzu Motors India, said that the company had set up 27 dealers across the country and would ramp up further in the coming months. Isuzu has sold about 3,000 units that include pickups and UV over the past few years in India.

12.1. Asus planning to make India its home market for smartphones

Economic Times | Apr.21, 2016

New Delhi: Taiwan's Asus, the world's fifth largest personal computer maker, plans to make India its home

market for smartphones, and is stitching together aggressive growth plans which involves doubling local production and spending on marketing in an effort to be a top five player.

Asus, still struggling to establish a presence in an intensely competitive market, plans to double local production to 600,000 smartphones this year, made by contract manufacturer Foxconn in Andhra Pradesh, while more smartphone launches in the Rs 6,000 and above Rs 20,000 price brackets will follow.

"Internally, we're thinking we should make India as our home base, especially in smartphones," Peter Chang,

Regional Head for South Asia and India country manager told ET, underlining the criticality of the South Asian nation - the world's fastest growing smartphone market - to global operations. The company that sells

smartphones, tablets, laptops and personal computers, launched its gaming laptops and desktops on Wednesday.

"We would be doubling our marketing budget this year, from 2-3% of revenue, because we want to have 5% market share," Chang said. The company claimed to have 2.3% market share.

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

12.2. Symphony makes ‘wall-mounted’ air cooler

BusinessLine | Rutam Vora | 4 May 2016

Further strengthening the Prime Minister Narendra Modi's ambitious mission of 'Make In India', the world's

largest air-cooler maker, Symphony Limited created yet another landmark by introducing first-ever wallmounted air cooler for household customers.

Branded as Symphony Cloud, the indigenously designed air cooler resembles with a split AC and will

be initially launched in Ahmedabad on Thursday. In next five-six months it will be taken to other parts of the

country.

"We have applied for a global patent for our 'wall-mount' design of air cooler. We are probably the first Indian Consumer Durable company to have filed for a global patent for a product. It took us 20 years to finally come to this design. This reinforces our commitment towards Make in India," said Achal Bakeri, chairman and managing director, Symphony Ltd here.

Priced at Rs 14,991 inclusive of installation charges in Ahmedabad, the wall-mounted air cooler has 15 litres

of in-built water tank and doesn't have an outdoor unit like a split AC. The electricity consumption is believed to be ten times lower than a split AC at merely 250 watts per hour, yet covering 100 square-feet of room area. Unlike other air-coolers, Cloud occupies no floor space, uses automatic water fill technology and is easy to mount on a wall.

"Cloud will be a game-changer for air cooling industry globally. We have created a detailed user manual to get the best performance. Unlike an AC, air cooler requires windows to be open," added Bakeri.

The new model will be made at Symphony's third-party manufacturing facility in Pune. "We will have different models in due course of time. The current model will be equivalent to a 1.5 tonne AC," Bakeri said.

India's residential air cooler market is estimated at Rs 3000 crore or about 6 million units, of which organised market is of around 2 million units. The overall market is growing at around 15-20 per cent per annum. Symphony, which holds about 50 per cent market share in the branded air cooler segment, has total installed capacity of 1 million units per annum.

13.1. Carmakers' exports overtake India sales

Business Standard | Apr. 25, 2016

Ahmedabad: Some car makers exported more than they sold in India in 2015-16.

Ford India’s exports grew 35.86 per cent to 110,840 cars. Its domestic sales grew 6.36 per cent to 79,944 cars in 2015-16.

“The segments in which we operate are not growing at a pace at which we would like them to. Therefore, we have been focussing on exports,” said a company spokesman.

Ford had said in 2015 it planned to triple exports from India over the next five years. The company exports the Figo hatchback and the Figo Aspire sedan apart from the Ford EcoSport sports utility vehicle.

General Motors’ exports from India grew 1621.54 per cent to 37,082 cars during 2015-16, beating its domestic sales of 32,540 cars that declined by 37.23 per cent.

General Motors, on its part, is pursuing an aggressive exports strategy. A GM India spokesperson said, “GM India is currently undergoing a business transformation. We are consolidating our manufacturing at our

Talegaon plant to localise, industrialise and optimise our footprint. Through our investment, we intend to increase our domestic market share. As well as pursuing domestic growth, over the next 5-10 years we plan to export up to 30 per cent of annual production.”

Volkswagen and Nissan, too, saw exports surpassing domestic sales. Volkswagen's exports grew 16.92 per cent to 75,989 cars while Nissan's exports fell 7.25 per cent to 111,612 cars. Nissan’s domestic sales dipped 17 per cent to 39,389 cars and Volkswagen's domestic sales declined 8.72 per cent to 41,096 cars.

India’s passenger vehicle exports increased 5.24 per cent during 2015-16, according to the Society of Indian Automobile Manufacturers, and local sales grew 7.24 per cent. These include cars, vans and utility vehicles.

Bajaj Auto and TVS Motor saw their three-wheeler exports beating domestic sales in 2015-16. While Bajaj Auto's three-wheeler exports dipped 1.68 per cent to 280,000, its domestic sales grew 8.8 per cent to 254,995.

TVS Motor clocked a 5.39 per cent rise in exports to 95,285 as domestic sales dipped 11.47 per cent to

15,536.

Harley-Davidson exported 5,241 motorcycles, up 63.78 per cent, more than its domestic sales of 4,708, up 1.44 per cent.

The focus on exports is a strategy for most automobile manufacturers, according to Abdul Majeed, industry

analyst and partner, PwC India. “It is a de-risking model when domestic demand dwindles, Majeed pointed out.

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

13.2. Hero to invest Rs 3.000 cr in new Andhra unit

Business Standard | Apr. 26, 2016

New Delhi: Hero MotoCorp is setting up a factory in Andhra Pradesh. It plans to invest Rs 3,000 crore, for annual capacity of 1.8 million units. Chief Minister Chandrababu Naidu will be unveiling the foundation stone next month.

Hero has three manufacturing facilities, at Gurgaon and Dharuhera in Haryana and Haridwar in Uttarakhand.

The two-wheeler major is also setting up two more facilities, at Neemrana in Rajasthan and Halol in Gujarat.

For the new facility, the state government has allocated around 600 acres at Tada in Chittoor district, close to Chennai — the latter is one of the largest automotive manufacturing hubs in the country. Last September, the company signed an MoU with the Andhra Pradesh government to allot 600 in Chittoor district to the company.

The facility will be close to SriCity, an industrial township. The allocation for this site has been the subject of a court battle already, with a Chennai-based company contesting it. Hero had to get a stay on construction removed via a high court order before it could erect a wall around the 600 acres it was allotted.

According to reports, the petitioner moved the High Court alleging that the AP government has failed to follow the provisions of fair compensation, transparent land acquisition and rehabilitation and resettlement. While a single judge delivered a verdict, a division bench stayed the order, which came as a big relief for Hero MotoCorp from the Hyderabad High Court, which vacated a stay on the construction work and allowed the two-wheeler maker to erect a wall around the 600 acres it was allotted.

With these developments, the company has decided to start construction of the factory. While the company

did not disclose any numbers till now. Last September, the AP government successfully wooed Hero MotoCorp and the facility will cater both domestic and export markets.

Hero MotoCorp proposed to build its sixth facility with a capacity of 1.8 million units with an estimated investment of Rs 3,000 crore. The new facility will take Hero's overall annual capacity of 12 million units.

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

14.1. Our top priority is accelerating design-led electronics manufacturing: IESA chief

BusinessLine | Sangeetha Chengappa | 29 Apr. 2016

The India Electronics and Semiconductor Association (IESA) announced its new Executive Council for 2016-17 on Friday. BusinessLine caught up with the new Chairman of IESA, K Krishnamoorthy, who is Managing Director, Rambus Chip Technologies (I) Pvt Ltd, to find out what it would take for India to become one of the top electronics manufacturing destinations in the world; when the country’s first Defence Electronics Policy will be announced and his immediate priorities for the Indian ESDM (Electronic System Design & Manufacturing) industry.

What are the priority areas you will immediately address as Chairman of IESA?

The top priority area is to accelerate design-led electronics manufacturing in the country. This is because we

are very import dependent with over 80 per cent of components such as microprocessors, microcontrollers,

display devices and over 60 per cent of products such as high-end TVs and high-end phones still being

imported. All of manufacturing contributes to 17 per cent of the country’s GDP, of which approximately 2 per cent is being contributed by ESDM.

The government is targeting to increase overall contribution of manufacturing to 25 per cent of GDP by 2020. We want to step up ESDM to be able to contribute significantly to that target. The demand for electronics is increasing every year across market segments like defence and aerospace, consumer electronics, automotive, healthcare, education, telecom etc; with domestic demand for electronics estimated to grow from $100 billion in 2015-16 to $400 billion by early 2020s.

How do you propose to accelerate electronics manufacturing?

The key thrust areas in manufacturing will be aerospace & Defence, consumer electronics and industrial electronics. In the area of development, we are looking to spur innovations in IoT solutions. Another key area is to enable ESDM start-ups through skills development and in creating start-up clusters which are plug n play facilities like the Electropreneur Park in Delhi, in every State. Maharashtra, Madhya Pradesh and Odisha have shown interest and we will assist DeitY (Dept of Electronics & Information Technology) in setting up Electropreneur Parks in one of these three States as soon as approvals come in this year.

When is the country’s first Defence Electronics Policy drafted by IESA along with Nasscom and presented to the Centre last year, expected to be announced?

The Defence Electronics Policy, aimed at reducing the country’s dependence on defence electronics imports

by promoting indigenous manufacturing capabilities, is still being whetted by the Defence Ministry. We expect the government to announce it this quarter (April-June).

What would it take for India to be among the top electronics manufacturing destinations in the world?

The top manufacturing hubs in the world are Germany, which is known for its technology; Japan which is

known for its quality and China which has mastered scale. For India to be acknowledged as a top electronics manufacturing destination, it must have all three – we are already good at technology which is evident from the fact that almost every electronics giant in the world has set up design, engineering and development centres in India. Quality can be ensured with education and training and we can achieve scale by taking manufacturing to rural India which has the space and the manpower who can be trained with minimum investment.

When will the chip fabrication project see the light of day?

As I understand, it is still in the discussion stage. One of the approved consortium members has withdrawn

from the project recently and now, only one player remains. The integrated chip fabrication project is limited by the huge capital outlay required. We need to take a fresh look at what is required – whether to set up a Fab in India or whether we should secure Fab capacity from outside India, where it can be manufactured more cost effectively. We have a fully functional Fab in SCL Chandigarh under the Department of Space which can be up-scaled to start with, for strategic needs.

14.2. Wire-maker Polycab to enter home appliances segment; withdraws investment from IPL

BusinessLine | Purvita Chatterjee | 25 Apr. 2016

Wire and cable company Polycab is planning to enter the home appliances category with products such as mixer grinders and irons. The Mumbai-based company with a dominant position in the household cables segment has been steadily increasing its presence in consumer durables having entered categories such as fans, lighting and water heaters in the past two years.

“We have assigned a capex of ₹1,200 crore for the next three years which includes setting up a manufacturing base for fans in Uttarakhand. Kitchen appliances like irons and mixer grinders will now get added to the consumer durable portfolio which we have been building for the past two years and expect the category to contribute 15 per cent of our turnover in the next four years,’’ said R Ramakrishnan, Joint MD and Group CEO.

Competing with big companies like Crompton Greaves (the market leader in fans), Usha and Havells in the

fans category, Polycab would be riding on its existing distribution base for cables and lightings to vend its new categories. “There are synergies with the cable business since the same electrician network can be used to sell new categories like fans and electric water heaters. We already have 3,000 direct dealers reaching out to one lakh outlets and this network is slowly being expanded as we enter new categories,’’ added Ramakrishnan.

Unlike the rest of its products, kitchen appliances would have manufacturing outsourced to third party players. The cable and wire company, in which World Bank body IFC has a 15 per cent stake, has been investing behind fresh campaigns every summer with the baseline ‘Connection Zindagi Ka’. This summer it had decided to invest in IPL for the first time but withdrew its decision subsequently. “Polycab had decided to buy television spots for the first time since fans sell during summer and IPL was the ideal platform. But now we have decided against it as media budgets are not substantial and clutter on this property would not help us,’’ said Ramakrishnan.

Polycab has developed a range of premium fans this summer and was planning to communicate the same

through fresh campaigns on IPL.

Currently it is not using e-commerce as a channel to sell its durables range, but in future it would consider

developing certain products which can be sold through this route. “We would develop alternate products for

our internet-based strategy which would have a separate value proposition from our regular products,’’ added Ramakrishnan.

15. Engineering is most impactful field of research in India: report

Livemint | May 10, 2016

New Delhi: India’s most impactful field in terms of research output is engineering while its most prolific in

terms of citations are chemistry and pharmacology, according to the Elsevier Report 2016, commissioned by the Department of Science and Technology.

The report looked at India’s contribution in the field of science and technology in terms of volume of research papers, global share and citation impact. The report said India’s scientific publications grew 13.9%, as against the global average of 4.1%, during 2009- 13.

Various indicators show India has a small but growing share of the world’s total scholarly output. India’s share of the world’s science and technology scholarly output has grown from 3.1% in 2009 to 4.4% in

2013—from 62,955 papers in 2009 to 106,065 papers in 2013.

Scopus is Elsevier’s abstract and citation database of peer-reviewed literature and covers 60 million

documents published in over 22,000 journals, book series and conference proceedings by nearly 5,000

publishers.

India’s share of the world’s patent citations increased from 2.2% in 2009 to 2.9% in 2013. “Although India is still a relatively small player on the global scientific stage, its wide-ranging collaboration network and increasing share of the world’s main research performance indicators reflect its overall growth in output, impact and knowledge transfer,” said the report.

In terms of knowledge transfer, India shows a higher emphasis in areas of computer science, material science, chemistry and pharmacology, toxicology and pharmaceuticals. Knowledge transfer includes analyses of patent citation patterns and collaborations between academic and corporate research institutions.

“As a whole, there is a promising trend as more Indian research is included in global journals and more

institutes are regularly making appearances in such databases. It has also been seen that collaboration is

expanding to not just include OECD (Organisation for Economic Cooperation and Development) partners, but others such as Brazil, China and Iran,” said Sujit Bhattacharya, senior principal scientist, Council of Scientific and Industrial Research-National Institute of Science, Technology and Development Studies.

Bhattacharya, however, added that publishing in high-impact journals is not visible to the extent one would

expect from a country like India. “There could be many reasons for this. Either papers have not reached the required mark or there are also cultural barriers that developing countries such as India face when it comes to citations,” he said.

Standout institutes

The Indian Institute of Science, Bangalore, is the most prolific and in the most number of subjects, with the

highest number of publications between 2009 and 2013 in six of the 16 subject areas, which include physics and astronomy, biochemistry, genetics and molecular biology, material science, chemistry, mathematics, and earth and planetary sciences.

The Indian Institute of Technology, Kharagpur, has the most publications in engineering and chemical engineering, and the Indian Institute of Technology, Delhi, has the most in the energy area. Anna University, in Guindy, Chennai, tops both in computer and environmental sciences, while Banaras Hindu

University leads in three subject areas—agricultural and biological sciences, immunology and microbiology, and veterinary sciences.

The Postgraduate Institute of Medical Education and Research, Chandigarh, and Annamalai University, in Chidambaram, Tamil Nadu, take the lead in medicine, pharmacology, toxicology and pharmaceuticals.

In terms of academic impact and citations, the three institutions that lead are the Tata Institute of Fundamental Research, Mumbai, Panjab University, Chandigarh, and the Indian Association for the Cultivation of Science, Kolkata.

Thirteen of the 30 top academic institutions have a strong specialization in engineering, while the most common specialized subject areas are chemistry, engineering, physics and astronomy.

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

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

16.1. Service sector growing at 10% annually: CII-KPMG

Times of India | Apr. 21, 2016

Mumbai: The service sector contributed about 61% of India's GDP in 2014-15, according to a joint report by CII-KPMG. The services sector is increasingly becoming critical to the development trajectory of a country, especially since the World Bank found that the sector's contribution in poverty alleviation is greater than that of agriculture and manufacturing.

The report said the Indian service sector is growing strongly at approximately 10% per annum, making India the second fastest growing services economy in the world. India's share in global services exports was 3.2% in 2014-15, double that of its merchandise exports in global merchandise exports at 1.7%, placing India in the eighth place currently among the top ten exporters of service in the world.

Rajat Wahi, partner and head, consumer markets, KPMG in India, said, "India's young demographic profile

combined with its rising literacy rate, offers it a significant competitive advantage vis-a-vis other developing

economies. Along with the 'Make in India' initiative that is striving to boost the manufacturing sector, the Prime Minister has outlined a vision to represent India as a world-class services hub across sectors. Multiple stakeholders need to work cohesively to help achieve this vision."

"Technology, innovation and creativity are rapidly redefining the global economy with digitization collapsing

distances and transcending borders. In the process, the impact of the services sector is turning out to be

manifold and significant. India has pride of place as the fastest-growing service sector nation globally. To keep the momentum going, it is critical that stakeholders, investors and policy-makers are best equipped in strategizing for the future and tapping the best markets globally." he said.

Among key services sectors, such as IT, telecom, tourism, media and entertainment, healthcare, management consulting, logistics and professional services, IT is the largest private sector employer in India, employing more than 3.7 million people. The industry is projected to grow at 8.5 per cent in 2016 fiscal, from us$132 billion in FY2015 to US$143 billion (excluding e-commerce). IT-BPM exports in fiscal 2016 are estimated at US$108 billion.

On the other hand, the tourism sector's contribution to GDP was US$125.2 billion in 2014, and is expected to reach US$259 billion in 2025 (accounting to 7.6% of India's GDP).

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

16.2. RJio brings high-speed subsea cable network to India

Business Standard | Apr. 19, 2016

Mumbai: Reliance Jio on Monday announced that the Bay of Bengal Gateway's subsea cable network spread over 8,100 km was operational.

The network has been built by six telcos to handle high bandwidth demands of emerging technologies and

applications. The system is a direct trunk connection between Barka in Oman and Penang in Malaysia. The

network is owned by Dialog Axiata of Sri Lanka, Etisalat, Omantel, Reliance Jio Infocomm, Telekom Malaysia and Vodafone. Construction of the system began in May 2013. The cable system will provide an alternate route to Europe by avoiding the congested Malacca Straits and other routes prone to cable cuts. The system has a wide terrestrial network that will enhance its reliability. The Bay of Bengal Gateway will have two landing stations in India - Vodafone will use Mumbai and Jio will use Chennai. Currently, Jio uses other subsea networks for its data traffic like SMW4, IMEWE, Europe India Gateway and Bharti's i2i. With BBG, Jio will be able to cut its reliance on other submarine networks.

The Bay of Bengal Gateway uses advanced fibre optic technology that allows capacity to be increased without submarine intervention. The initial capacity of the system is nine terabytes per second. The network connects to Europe, Africa and Southeast Asia with existing terrestrial and subsea cable systems.

Reliance Jio owns and operates the cable landing facility at Chennai. "It offers not just direct connectivity in

and out of India through Chennai and Mumbai but also acts as a state-of-the-art extension to Jio's core

network," said Mathew Oommen, president, Reliance Jio. "This connectivity brings international content hubs closer to our customers." Three other Indian companies have invested in subsea cable networks.

Reliance Globalcom's undersea cable system spans 65,000 km and is integrated with Reliance Communications' optic fibre network in India. Tata Communications' global network comprises 206,356 km of terrestrial network fibre and over 500,000 km of subsea cable along with a trans-Atlantic and trans-Pacific data transfer capacity of one terabyte per second. Bharti's i2i has a submarine telecommunications cable connecting India with Singapore, spanning 3,200 km with a landing point in Chennai.

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

17.1. Internet users in India to cross 500 mn in 2016: Prasad

Business Standard | May 05, 2016

New Delhi: The number of Internet users in India is likely to cross 500 million this year, according to Ravi

Shankar Prasad (pictured), minister for communications and information technology.

“India has grown to around 400 million Internet users. If we take Trai (Telecom Regulatory Authority of India) numbers, it is somewhere close to 332 million. Service providers are telling me the up-to-date figure would be 402 million. We were to have 500 million users by 2017; I feel it will happen this year itself,” said Prasad, while launching a narrative story book titled Digital Desh Drive.

India has now around one billion mobile subscribers, he added. People in India, especially at grass-root levels, are using technology to transform their lives. “After being IT and communications minister, I’m indeed experiencing a different India. India is sitting on cusp of a big digital revolution. Indians first observe technology, then adopt technology and then they start enjoying it and become empowered in the process,” Prasad said.

Digital Desh has incorporated insights of small Indian businesses that are using Internet to transform their businesses. In a separate development, the government is setting up a centralised monitoring system (CMS) to automate process of lawful interception and monitoring of phones and internet. “The government has decided to set up the CMS in a phased manner to automate the process of lawful interception and monitoring of mobile phones, land lines and the internet in the country,” Prasad said in a written reply to the Lok Sabha.

“The CMC at Delhi and RMC (regional monitoring centre) at New Delhi and Mumbai have been operationalised,” Prasad said. CMS’ objectives include electronic provisioning of a target number by government agencies without any manual intervention from telecom service providers on a secured network, thus enhancing the secrecy level and quick provisioning of the target.

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

17.2. TCS bounces back with 64% jump in Q4 profit to ₹6,341 cr

Our Bureau (BusinessLine)/PTI | 18 Apr. 2016

After missing market expectation for six straight quarters, TCS bounced back in the fourth quarter, posting a massive 64.4 per cent jump in net profit to ₹6,341 crore from ₹3,858 crore in the corresponding quarter last year. The growth has been primarily driven by the digital business and a strong performance in the core portfolio.

“Our core portfolio performed strongly in a seasonally weak fourth quarter, driven by strong volumes led by growth in the BFSI, retail and manufacturing sectors. This gives us good momentum going into the new

financial year,” said TCS’ Chief Executive Officer and Managing Director N Chandrasekaran “Our investments in building high-impact digital platforms are paying off, resulting in over $2.3 billion in digital

revenues,” he added. Revenue for the quarter grew about 17.5 per cent to ₹28,449 crore from ₹24,219 crore last year. Sequentially, TCS’ profit and revenue have grown about 4 per cent.

The fourth quarter saw broad-based growth with the core portfolio performing strongly led by BFSI (3.2 per cent Q-o-Q), manufacturing (3.9 per cent Q-o-Q) and retail (2.1 per cent Q-o-Q). On the volume front, TCS managed to beat Infosys with 3.2 per cent growth, while the latter reported a growth of 2.4 per cent.

“TCS is the second IT major to beat expectations this season despite many significant changes in the macro economic environment in territories where their key clients operate. This is a clear reassurance that the investment made earlier to reinvent themselves in the light of global acceptance of the digital business, the impact of cloud and other contemporary technologies are now starting to pay dividends,” said Sanjoy Sen, Doctoral Research Scholar, Aston Business School, UK.

The good thing for the company is that the headwinds that had pulled down its performance for the last six

quarters seem to have dissipated. “The insurance segment has turned a corner. In terms of Latin America, that has been doing well last quarter and even this quarter they've done well and as we go into the next year, it looks good. Our energy and utilities division has also done well and as we go into the future, we expect that business will continue to do very well,” Chandrasekaran said.

No comment on penalty

However, the $940 million penalty imposed by a Wisconsin jury could weigh heavily on the company if it

losses the legal proceedings. Chandrasekaran declined to comment on the case. During the January-March quarter, TCS added 22,576 employees (gross), while on a net basis the addition was 9,152, taking the overall employee strength close to 354,000. For the full year, the company added a gross 90,182 employees.

18.1. India is our fortress market in Asia Pacific : Thorsten Kirschke, Carlson Rezidor

Economic Times | Apr. 25, 2016

New Delhi: India is the second largest market for American hospitality management company Carlson

Rezidor, says its Asia Pacific president Thorsten Kirschke. Carlson Rezidor, which runs the Radisson group of hotels, has 43 hotels in the pipeline in India, only surpassed by the US. It currently operates 76 hotels in the country and plans to strengthen its presence through conversion of existing properties and management contracts. Speaking to ET's Divya Sathyanarayanan, Kirschke outlines the group's plans in India and how it is undeterred by the mega-mergers in the industry and the new age 'disruptors'.

Q- It's been almost two years since the new government took charge in India. Do you see some major changes on ground?

A- Due to the size of the population in India, the government finds it hard to put in place the policies and new guidelines. It takes time and patience to turnaround a tanker on sea versus a speedboat. So concretely, we see very little other than initiatives. The challenge is not the policy or the guideline, it's the execution. The

government announced that it wants to clean up India, build new highways, Make In India, etc. All of these are great initiatives, but they need 12 years and not 12 months before you see a physical result. So we have always looked at India with a long term approach to business. And we find ourselves well aligned with the

government initiatives. 2015 was a great year for us in India, with the market developing. RevPar (Revenue

per Available Room) has seen an increase after four years of downturn. So yes, we are cautious but

optimistic.

Q- Growth of foreign tourist arrivals to India has seen a slight dip last year. Does that worry you?

A- No, not really. I think that is a short term dip we see. It's been well offset by the domestic demand. The

increased supply of hotel inventory has been absorbed. We are having a healthier environment. On the back of this, there is opportunity to yield more rate. The underlying fundamentals and signals are pointing at a better future over the next 3-5 years.

Q- How has India performed for the group?

A- Last year we signed 15 hotel contracts here, including a portfolio of seven hotels in the region of Jammu & Kashmir. At the same time, we opened five hotels last year. This year, we hope to continue the same

momentum and may be grow higher. India is our fortress market in Asia Pacific. We remain not only

committed, but accelerated and invested in this market. On a global scale, it (India) is only surpassed by the

US. It is the second most important or strongest representation as a country for the group. We see most of the future growth and opportunities within Asia Pacific.

Q- Last year, the industry witnessed consolidation and some big ticket mergers have shaken up the

industry. The Marriott-Starwood combined entity will soon be the largest hotel group in India and globally.

A- Right now, we are the international hotel brand leader in India. Any merged Marriott-Starwood would not dethrone us. In fact, it's a tie between us. By number of properties, we are 119 hotels signed and operating and we are also adding 14-15 hotels each year. This robustness of the pipeline will keep us in the lead position. By the number of rooms, the leadership position may be up for grabs possibly. But ultimately, any consolidation could also result in shedding. One has to decide whether to be a scale player or to create shareholder value in different means. We have never defined ourselves as a purely scale player.

Q- How do you tackle the new age 'disruptors' such as Airbnb and online travel agencies (OTAs)?

A- There will always be some form of disruptor. The industry has come a long way. We have improved on our own competitiveness of distribution and communication with the consumers. The B2C communication and dialogue has much improved under the challenge of OTAs, because we were forced to improve. But it has resulted in good things. We have invested much more in technology which is more consumer friendly and opens more opportunities. The OTAs are there to stay. I think it's an illusion to think that we can put them out of business. What we can do is collectively work on the way we collaborate because there is a meaningfulness to them. At the end of the day, they do provide incremental reach and that cannot be denied. There are certain markets and destinations' hotels that would not even have a chance remotely to exist if it wasn't for the instant reach to millions of people through these OTAs. So I think there is still merit in the OTAs because they are an integral part of the travel ecosystem around the world.

Q- With scale being an important factor, what kind of opportunities are you looking to beef up your presence in the market?

A- Scale for the scale sake is probably destroying shareholder value rather than creating. So we are constantly evaluating meaningful opportunities. We have 76 hotels in operation and a pipeline of 43 which is expected to hit the market over the next three years. At the same time, we are signing new management contracts and looking at conversion opportunities in the market to grow faster.

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

18.2. Total addressable travel market in India will be US$ 40 billion by 2020: Nathan Blecharczyk, co-founder, Airbnb

Economic Times | May 05, 2016

New Delhi: World's largest marketplace for accommodation Airbnb sees India as a $40 billion travel market by 2020. Airbnb relies on its USP of offering a local experience to guests, different from staying in a hotel, which Nathan Blecharczyk, co-founder of Airbnb, described as 'mass produced and commoditised'. The 2008 startup — funded by Y Combinator, Sequoia Capital, Greylock Partners and others — operates in 191countries with a staff of just 2,000. In April, it entered into a strategic partnership with the Times Group, publishers of this paper, to expand its footprint in India and create a local experience. In an interview to ET, Blecharczyk, one of the three co-founders of Airbnb, discussed Airbnb's impact on the market, how it copes with regulatory challenges, and plans to grow.

Excerpts...

What does Airbnb cater to? Is it travel, short term stay, or both? How do you define it?

Airbnb is great for any accommodation you want to book up to three months. If you are doing internship over summer, or just travelling as a tourist, you might want to check it out. The average stay at Airbnb property is 4-5 days.

For 4-5 days, it's a bit of a hassle to go into an unbranded, unknown place. How does that compare with hotel stay?

It's very transparent. Paris is our top city with 70,000 homes on the platform, followed by New York and

London. Airbnb is away for visitors to live like locals. You are in a local neighbourhood — you can stay in tree houses, igloos, castles, houseboats, heritage homes, etc. It is a totally different feeling compared to a hotel. Hotel experience is very mass produced, commoditised. But travel is about local experiences and hotel may not be the best option. The aggregator model has not gone down well with regulators in several countries. Even cab aggregator Uber has had frequent problems. In Berlin and other markets you have faced headwinds.

How do you see your business in India?

The Airbnb model has come on to people's radars rather suddenly. Obviously, none of the existing policies

contemplated such a thing is possible. Governments are trying to figure out what is this new model. And how

should existing rules apply. There's an appreciation that new rules need to be created and when that happens we have seen very favourable rules. In 30 or so cities and countries, favourable home share laws have been passed, like in France, UK, Portugal, Netherlands. Even the India government has a favourable disposition to this. Our stance as a company is to try to have conversations with local authorities. For instance, there are issues like tax that come up. We can add value here. We are already handling money. We do that in many cities. Once we get into these dialogues, it becomes constructive.

The platform has been used in India for some time now. What has been the response?

India is a company priority now. There are 18000 homes in India on Airbnb in 100 cities and that number has grown 115% in the last year, and on the travellers' side, we have seen 185% increase in travellers from India going abroad. We think there's a rising tide here, the market is growing and it's predicted by 2020, the total addressable travel market in India will be $40 billion. We don't grow by giving discounts, but primarily by word of mouth.

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

19.1. Look beyond drug producers

BusinessLine | Eswarkrishnan Chellam | 15 May 2016

Expanding the scope of the pharmaceutical market to include healthcare opens a host of opportunities to investors. Factors such as favourable demographic profile, increasing focus on preventive healthcare and rising share of chronic diseases indicate strong domestic growth prospects for healthcare companies.

While such companies did not actively pursue the equity market earlier, a slew of healthcare IPOs in the

recent past opens up an exciting new segment to investors. Offers from mid-cap companies that derive

revenues by providing either healthcare delivery or diagnostic services have the potential to add zing to

investor returns. Post-listing exposures, too, can be considered.

Diagnostic chains

According to a World Bank report, the healthcare spend in India is only 4 per cent of GDP and trails

developing countries such as Brazil and China. A CRISIL report estimates that the Indian diagnostic industry will grow at a CAGR of approximately 16-18 per cent to reach ₹58,500-61,600 crore in FY18. The report also expects the share of organised diagnostic chains to grow faster at a CAGR of 21-23 per cent to reach 16 per cent share by FY18.

Some companies in this segment have tapped the capital markets this fiscal year. The ₹638-crore offer for

sale in December 2015 from New Delhi-based Dr Lal Path Labs witnessed strong investor interest.

The issue was oversubscribed around 33 times. Propped up by strong financial performance, the debt-free

company trades at a trailing 12-month price earning ratio of around 60 times. This is almost three times the valuation of the broad-based indices and twice the earnings multiple of the S&P BSE Healthcare Index.

Likewise, the offer for sale of Thyrocare Technologies was oversubscribed around 73 times and raised close to ₹480 crore. The company, which listed on May 9, closed with gains of 40 per cent. The offer from pure-play pharmaceutical company Alkem Labs was also in demand. With over-subscription of around 44 times, it witnessed strong listing gains. The company, though, trades at a discount to the listed diagnostic players. Biocon’s contract research arm Syngene International also had a good run. It was oversubscribed around 31 times, and now trades 55 per cent above its offer price.

Potential triggers

According to a WHO strategy report, the private sector dominates the personal healthcare market in India,

providing 80 per cent out-patient care and 60 per cent of in-patient care. CRISIL estimates that the healthcare delivery industry will grow around 12 per cent over the next five years to reach ₹6,80,000 crore by 2019-20.

Lower government investments in healthcare, low penetration of health insurance and high scope for medical tourism can act as potential triggers for organised players.

It is, therefore, not surprising that the ₹613-crore issue of Bengaluru headquartered hospital chain Narayana Hrudayalaya trades at a 23 per cent premium to its offer price. A low debt to equity ratio and asset-light

operating model, coupled with plans to expand into anti-cancer, neurology and gastroenterology from cardiac care, is expected to drive revenues.

The common thread running through companies that have provided listing gains is a potent combination of

sensible offer price, established business, strong management, good financials and viable growth prospects.

In the medium term, retail pharmaceuticals may well be the next emerging trend. According to Pharmaleaders, the unorganised channel commands 97 per cent of market share, providing ample scope for organised players to grow. The evolution of e-commerce can also act as a fillip to such players.

19.2. GSK pitches to participate in the Universal Immunisation Programme

BusinessLine | Jyothi Datta | 25 Apr.2016

British healthcare major GlaxoSmithKline is keen on participating in India’s Universal Immunisation Programme, GSK top brass said, referring to recent proposals made by them to the Government.

There have been frequent conversations over several months with officials from the local and Belgium offices, Thomas Breuer, GlaxoSmithKline Plc’s Chief Medical Officer (Vaccines) told BusinessLine.

“GSK and personally I am excited that the government wants to invest in prevention. Currently they are talking about the pneumococcal vaccine,” he said, adding that more vaccines were on offer if the government wanted.

GSK operates in the pharmaceuticals, consumer products and vaccines segments and is presently the world’s largest producer of vaccines by volume. Its rotavirus, pentavalent and cervical cancer vaccines are available in the Indian private market.

However, the multinational has not been majorly involved with the universal immunisation programme (UIP)

for reasons varying from the government’s requirements on particular products to the company’s own capacity to supply.

With a strong footprint in India, Breuer says, “whether we do more or not more will really depend on what will happen in India.” Explaining further, he says, “India is – from a birth cohort or population point of view –such a big market. The latest move from the Modi government to invest in prevention, put vaccines which are already existing in the private market into a public setting is a good sign.”

“We have offered our participation and if this is taken up then there is more space to do more in India. But it will depend on the kind of volume,” he says. GSK’s pitch to get involved with the UIP comes against the backdrop of the World immunisation campaign this week where the World Health Organisation has urged countries to get more people vaccinated against illnesses.

Pricing strategy

Explaining GSK’s strategy, Breuer said, the tiered pricing policy where medicines and vaccines are priced

differently in different countries depending on their economic conditions has worked well to improve access to their products.

The price drops further in public markets if the commitment is for larger volumes or longer periods.

So vaccination of a large group of new-borns for a period of say two or five years will impact price, he said,

adding, “this kind of proposal has been made to the Indian government for public vaccines like pneumococcal ….right now we are not a player as far as the rotavirus vaccine is concerned we have the volumes, so if the Indian government is interested we can (supply).” GSK’s India chief Annaswamy Vaidheesh added that they would participate in the Centre’s next round of bids for rotavirus.

Safety concerns

Breuer feels that the cervical cancer vaccine too should be on the government’s programme as it impacts the health of young women. On safety concerns involving their cervical cancer and rotavirus vaccines, he said, that transparency, awareness and education were required to build public confidence.

GSK’s vaccines operations got bigger in 2014 following a $23-billion asset swap with Novartis-GSK swapped its oncology business with Novartis’ vaccine business.

In India, vaccines are under GSK Pharmaceuticals and the Novartis transaction was completed from April 1.

The integration brought about 140 people into GSK India besides products like the rabies vaccine and the

meningitis portfolio among others.

In June, GSK will launch its MMRV vaccine (against measles, mumps, rubella and varicella), said Breuer, a strong promoter for combination vaccines.

“You don’t see children in physician offices all the time, so the more vaccines you can give in one shot, the

better it is. Next year, we will launch a hexavalent paediatric vaccine (protecting against six illnesses including polio, Hepatitis and Hib). This currently does not exist in an Indian market,” he added.

20.1. Aviation Soaring to the skies

BusinessLine | Anand Kalyanaraman | 17 Apr. 2016

Cheaper fuel and rapid rise in passenger traffic have helped airlines turn around. But policy support is key to sustaining momentum.

The aviation sector in India has not had it this good in years. Passengers are taking to the skies in droves. At about 8.1 crore tickets, domestic passenger traffic during January to December 2015 was up more than 20 per cent year-on-year.

The pace has only picked up in 2016 — traffic growth until February this year is more than 23 per cent. India is today the fastest growing major aviation market in the world.

Fuelled by cheaper fuel

This stellar growth has been made possible primarily by the deep cut in the cost of aviation turbine fuel (ATF), the largest operating expense for airlines in the country. The rout of crude oil since June 2014 has seen ATF following suit, even if not to the same extent.

At ₹42,157, a kilolitre of ATF in Delhi today is about 40 per cent cheaper compared with two years back and 15 per cent over a year. This has translated into big savings for airlines. For instance, the country’s largest carrier IndiGo Airlines spent about 17 per cent less on fuel in the nine months ended December 2015 compared with the year-ago period, despite increase in its fleet size. As a result, its fuel cost as a percentage of sales fell to 31 per cent from 45 per cent a year ago.

Airlines have passed on a portion of this benefit to passengers through cheaper tickets. IndiGo’s average fare per passenger, for instance, was down 12 per cent year-on-year in the nine months ended December 2015.

The price-conscious Indian flier has played tango and lapped up the attractive fares and deals on offer (see

“Good times for the Indian flier”). Ergo: load factors of airlines have got a nice bump-up.

Profit, at last

Higher revenue and lower costs have translated into tidy profits for many airlines, a welcome relief after years of losses. After a disastrous 2013-14 when soaring costs, aggressive price cuts and heavy debt burden saw the sector’s loss touch a record high, things started looking up in 2014-15 with losses being curtailed. The momentum improved significantly in 2015-16 — the three listed airlines Jet Airways, SpiceJet and IndiGo have all been profitable throughout the year with record profit in the December 2015 quarter.

The March quarter results of these three airlines, expected over the next few weeks, should also be healthy, though not as strong as in the December quarter which is seasonally the best for the sector. Also, GoAir, the only carrier besides IndiGo to be consistently profitable, is expected to grow its profit significantly in 2015-16.

Even Air India, which is running on life support from the government, is expected to post an operating profit in 2015-16. Air Asia India and Vistara, which began flying over the last two years, have been lucky with their timing of entry into a highly competitive market.

These airlines are seeing good passenger traffic growth, though on a small base. It could be some time, though, before they achieve scale and breakeven, with older airlines adding to their capacity and routes in a big way. Ditto for Air Costa, Air Pegasus and Trujet — the new airlines operating on regional routes.

Stocks on a roll

In late 2014, confidence in the Indian aviation sector and airline stocks had touched its nadir, when SpiceJet looked all set to fall off the radar like Kingfisher Airlines had in 2012. But the spectacular comeback by the

sector last year has seen airline stocks roar back into favour on the bourses.

Over the past year and a half, the SpiceJet stock has more than quadrupled and the Jet Airways stock nearly tripled. This is despite these stocks ceding quite some gains in recent months. IndiGo, true to style, timed its IPO perfectly in October last year to make the most of falling costs and surging traffic. Of course, being the market leader, and a highly profitable one at that, helped. The offer romped home with manifold

oversubscription. After galloping more than 75 per cent in less than two months, the stock crashed below its IPO price mainly due to concerns over delay in the delivery of the A320 neo aircraft. With the aircraft delivery having started now, the stock has recouped some losses, though it still trades a quarter below its peak price.

The year gone by was great for airline stocks, but with valuations and also crude oil inching up, and higher

taxes on fuel, there could be some air-pockets ahead (see “Betting high”).

Policy push awaited

The next big trigger for the sector and airline stocks could be the delayed and much-awaited National Civil

Aviation Policy. Reports indicate that the policy could be finalised by the end of this month. The draft policy

tabled last October had a significant thrust on improving regional connectivity.

This could open up significant opportunities for carriers in the country, especially the low-cost ones. And it is indeed imperative if the government’s target to increase domestic ticketing to 30 crore by 2022 and to 50 crore by 2027 are to be achieved — these imply a compounded annual growth rate of about 20 per cent, similar to current growth rates.

This may not be a pie in the sky, given the highly under-penetrated air travel market in the country. But the

measures proposed to achieve the outreach — caps on airfares on the targeted routes and extra 2 per cent

levy on other tickets — may defeat the purpose by distorting market pricing. Will the final policy address the concerns?

Another key aspect airlines are seeking clarity on is the 5/20 rule that mandates five years of domestic

operations and a fleet of 20 aircraft before an airline can start international operations. In the draft policy, the government did not reveal its hand on this contentious rule that has split the sector down the middle. The older airlines want this rule to continue while new entrants AirAsia India and Vistara that seek to fly international soon are opposing it vehemently.

The draft policy kept all options open by suggesting that the rule could continue, or be abolished, or be

replaced with a (complicated) system of domestic flying credits. Reports suggest that the 5/20 rule may be

replaced by a less onerous rule, maybe 0/20. Whether the government will make it easier for more airlines,

and thereby consumers, to fly abroad, will be keenly watched.

Airlines have for long been seeking reduction of high State taxes on ATF which make the fuel 50-60 per cent costlier in India than in many other countries. Only a few States have obliged so far, while those with major airport hubs continue to charge 25-30 per cent sales tax.

Meanwhile, in the recent Budget, the Centre raised excise duty on ATF steeply from 8 per cent to 14 per cent. Cheaper air fares have been the key growth driver for the Indian aviation sector in recent times. Will high taxes kill the goose that lays the golden egg?

Betting high

The sector is known to make millionaires of billionaires, and Warren Buffett famously shuns it. But investors who had the gumption to bet on Indian aviation stocks in the dreary days of late 2014 would be pleased as

punch.

Click here to read more: http://goo.gl/moZl6U

Will good times continue for the Indian flier?

That the Indian flier is price-conscious is clear from the rapid growth of low cost carriers (LCCs) in the

domestic skies. Over the years, LCCs such as IndiGo Airlines, SpiceJet and GoAir gained market share

rapidly at the expense of the full service carriers (FSCs) — more than 60 per cent of passengers in the country now fly with LCCs. Also, except Vistara, the new carriers in the Indian skies are all LCCs. Why, even the FSCs such as Jet Airways and Air India often price their economy class tickets around levels similar to those of LCCs. Low fares have invariably attracted the Indian flier, a case in point being the ongoing rapid growth in passenger traffic.

20.2. Green panel gives nod for port, airport upgrades

Livemint | Apr. 22, 2016

New Delhi: An expert panel of the Union environment ministry has recommended approvals for projects worth Rs.20,500 crore in the aviation and port sectors.

Based on these recommendations, a final decision will be taken by the ministry.

The important projects that have been recommended for environment and coastal zone regulation clearance include expansion of the Visakhapatnam port and Adani’s Dahej port, construction of a new oil berth at Jawahar Dweep Island managed by Mumbai Port Trust and expansion of the Naini Saini airport in

Uttarakhand, according to the minutes of the Expert Appraisal Committee (EAC) for Infrastructure meeting

held on 28-29 March.

The EAC also cleared the so-called terms of reference (ToRs) to develop an international airport at

Bhogapuram (Andhra Pradesh), a commercial airport at Mundra (Gujarat) by Adani Ports and Special

Economic Zone, a new port at Vadhavan (Maharashtra), a heliport in Greater Noida (Uttar Pradesh) extension of runway at Rajahmundry airport (Andhra Pradesh), upgradation of Mumbai’s Chhatrapati Shivaji international airport, expansion of Krishnapatnam Port at Nellore (Andhra Pradesh) and development of integrated facilities at Kandla Port (Gujarat). ToRs are guidelines specified for conducting environmental impact studies of projects based on which the ministry grants or rejects environment clearance to a project.

According to the minutes of the EAC meeting, the guidelines cleared for the projects were so-called standard ToRs with additional conditions.

The environment ministry introduced standard ToRs in April 2015 to speed up the process of conducting green impact studies. Now, ToRs are issued within 30 days, unlike during the previous United Progressive Alliance government, when it used to take up to two years (Mint story: bit.ly/1SdMtRl ).

“Standard ToRs have cut down delay for industry. We are also ensuring that apart from standard ToRs

additional conditions are added as and when required in specific cases to protect the environment,” said a

senior environment ministry official, who did not wish to be identified.

However, experts point to the absence of a proper monitoring mechanism for clearing projects. “The

environment ministry, as early as February 2014, asked all state governments to develop institutions to

monitor projects that get green clearance. But even as projects are cleared with conditions, there exists no

robust mechanism to monitor them,” said Sanjay Upadhyay, an environmental advocate in the Supreme Court and managing partner of the Enviro Legal Defence Firm, an environmental law firm that also takes up training, education, publishing and outreach work.

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

INDIA & THE WORLD

21. Will protect local solar firms ‘come what may’

BusinessLine | Debabrata Das | 6 May 2016

Piyush Goyal, Minister of State (Independent Charge) for New & Renewable Energy, Power and Coal, is

confident that India is on a “strong footing” as it defends its solar programme at the World Trade Organization. Goyal’s confidence stems from the fact that even the US, which had challenged India’s programme of mandating domestic content, has 16 domestic content procurement requirements in place in various states.

Earlier this year, the WTO’s dispute settlement panel ruled that the domestic content requirement in India’s Jawaharlal Nehru National Solar Mission flouted multilateral trade rules as it discriminated against foreign

manufacturers. This was on the basis of a case filed by the US against India three years ago, which India is contesting.

“We are on a strong footing. I stand committed to ensure that domestic manufacturers are protected come

what may. I want to reassure Indian manufacturers that domestic production will be protected,” he told

BusinessLine.

Goyal, who has been very vocal against the US’ move, has been maintaining that that the Americans have

taken a very myopic view of the domestic content requirements.

Alternative plan

However, if things go against India, Goyal has a Plan B in place. “I have my back-up plans on how to support them (domestic firms) irrespective of the outcome at the WTO,” he said, without elaborating.

The Plan B may show procurement is for government use through public sector agencies. India has been

arguing that since the power generated through the Mission was bought by state-owned NTPC, the

transaction qualifies as government procurement and is not covered by WTO rules. Defence procurement is another option.

While the National Solar Mission aims to add 100,000 MW of solar power by 2022, the local content

requirement is only for 8,000 MW for rooftop and land-based projects, where the government provides a

subsidy.

Of the total installed capacity of around 6,000 MW of solar energy in the country, only 400 MW has been

supplied by Indian manufacturers.

22. Highlight of April has been strong showing in the domestic market: S Ravikumar, Bajaj Auto

BusinessLine | Mini Menon | 2 May 2016

Bajaj Auto’s April sales dropped 2 per cent, with exports plunging 36 per cent, due to a slump in sales in Nigeria, the company’s largest market in Africa.

Speaking to Bloomberg TV India, Bajaj Auto’s President of Business Development, S Ravikumar said April domestic sales zoomed 30 per cent — motorcycles grew 25 per cent and three-wheelers grew 80-82 per cent.

What are the highlights of the Bajaj Auto sales during April? Why has there been a big knock on exports?

The highlight of this month has been a very strong showing in the domestic market, both in motorcycles and three-wheelers. In motorcycles, we grew 25 per cent in April 2016 compared to April 2015 — from about

1,60,000 units to over 2,00,000 units. And in three-wheelers, we grew from about 14,000 units to around

26,000 units, which is a growth of almost 80-82 per cent. So put together, there is almost a 30 per cent growth in the domestic market. Every single motorcycle that we launched right from January 2015, whether it was CT 100, Platinum, the three Avengers or the CT 100B, has been a success. On the back of that, from a sub-15 per cent domestic market share in bikes in January 2015, today we are sitting at a market share of about 20 per cent plus, which has been great. And in three-wheelers, we have seen very strong growth. We recently added Cargo and it has been spreading its wings. About 700 units of Cargo were sold in April.

Coming to exports, the problem has been Nigeria. The Nigerian currency was 156 Naira to a US dollar for

most part of the last year but it started depreciating very rapidly and went down to almost 400-410 to a dollar. And in that type of macroeconomic scenario, there was turmoil in the market and retail sales collapsed. In February, March and April, that is what panned out in our wholesale export numbers and we had about 100,000 units of exports. We already guided that exports will continue to be subdued in April also because we had to correct stocks. But we knew that the currency was always stabilising and the naira has stabilised at 250-270 to a dollar. Oil has been improving a bit and that is good for that economy. And the Nigerian government has taken some steps. On the back of that, in April itself, retail outlets have picked up 21,000 units of bikes and 2,000 units of three-wheelers. Give us a sense of how Nigeria has been in context of African operations...

Nigeria has been a top market for us in Africa. And there is a lag in exports. Once I ship out it hits the market there maybe after two-and-a-half months.

Now, with the currency depreciating from 150 to 400 to a dollar, I have to adjust my stocks and dispatches.

Now, with the currency stabilising there, customers are coming back and that boosted sales in April 2016 to 22,000 units.

23. How India will gain from Saudi’s Vision 2030

BusinessLine | Kpm Basheer | 3 May 2016

The ambitious blueprint for economic development called Vision 2030 unveiled by Saudi Arabia this week, which will lead to huge investments and building of massive manufacturing facilities and infrastructure, offers a range of opportunities for Indians.

NRIs in Saudi Arabia and other Gulf countries told BusinessLine on the phone that India would be one of the biggest gainers from the change of tack the kingdom is planning in its economy. “The Vision opens a world of opportunities for Indian job seekers as well as business people,” says KV Shamsudheen, Director of the UAEbased Barjeel Geojit Securities LLC, who is also the Chairman of the Pravasi Bandhu Welfare Trust. “The massive investments planned over the next 15 years in various sectors of the Saudi economy will require a steady influx of skilled workers; it will also open up a window of business possibilities for Indian entrepreneurs.”

George Alexander, a Kottayam-born middle-level engineering executive in a multi-national company in Al

Khobar, noted a stream of highly qualified professionals from India would find jobs in the kingdom, though the reform basically wanted to give jobs to Saudi locals.

Green Card

Salam Yusuf from Malappuram, who owns a medium enterprise in Jeddah, said the proposed Green Card for foreigners would be a great incentive for Indians to stay on in Saudi Arabia and plough back their profits into their businesses. The offer, to be in place in five years, would be restricted to ‘Arabs and Muslims’.

The announcement of the Vision 2030 by Deputy Crown Prince Mohammed bin Salman, who is the Chairman of the Council of Economic and Development Affairs, is considered an important landmark in the kingdom’s life. Prince Mohammed, son the monarch King Salman, while unveiling the Vision, claimed it was an “ambitious but achievable blueprint” which expressed the kingdom’s “long-term goals and expectations”.

While the details are yet to be announced, the major plans include: liberating the Saudi economy from the dependence on oil in five years, partial disinvesting in Saudi Aramco, which is the world’s largest energy production company and which produces about 10 per cent of global oil production, extensive exploration of

the country’s natural resources such as minerals, and a countrywide boost to tourism development.

The proceeds from the 5-per cent IPO in Aramco would go into a $2-trillion Public Investment Fund, which would be the world’s largest sovereign wealth fund. It would funnel the investments planned abroad. The sale of 5 per cent of Aramco will likely be the biggest IPO in history.

The Vision includes plans to set up military manufacturing facilities so that by 2030 Saudi Arabia can make at least a half of its military needs. Prince Salam had noted that though the kingdom was the third largest

spender on weaponry in the world, its military industry was nascent. This situation would change soon.

A decent share NRIs BusinessLine spoke to pointed out that after Prime Minister Narendra Modi’s recent visit, the kingdom was planning gigantic investments in India, even surpassing the ones committed by UAE after Modi’s visit there last year.

“India could hope for a decent share of the new $2-trillion sovereign fund proposed,” one Keralite financial sector professional noted.

Two of the key areas where Indians could find jobs are the large-scale expansion of tourism in the vast

country and the exploitation of minerals and other natural resources other than oil. Saudi now exploits hardly 3 per cent of its minerals.

Throwing open the entire country for tourism — especially those visiting for Haj and Umrah — would require creation of extensive tourism infrastructure. This would mean lakhs of new jobs for expatriates, including those from India. Already, the nearly 3 million Indians make up the largest expatriate community in Saudi Arabia.

24. Metal tycoon Gupta turns British steel saviour

BusinessLine | Suresh P Iyengar | 3 May 2016

Having expressed interest to take over Tata Steel’s loss-making asset in UK, Sanjeev Gupta, the promoter of Liberty Group, has to now convince the UK Government that he has the financial backing and wherewithal to deliver something that the Tata’s could not after investing billions of dollars before giving up on its effort.

Besides Liberty House, Excalibur Steel UK is also shown interest to bid for Tata Steel UK. Excalibur is led by Stuart Wilkie, the head of Tata’s British strip steel business. Liberty House and Excalibur appear to be the only two credible interested parties in Tata Steel UK. Liberty, which has tied up with Australian bank Macquarie for financial backing, is expected to submit its bids today.

The ability of Gupta, who is known for taking over struggling steel making business and turning it around, will be put to test.

To start with, 44-year-old metal tycoon Gupta might have got his strategy right by setting up a team led by

former Tata Steel executive Jon Bolton, who until last year was heading the European Long Products

business.

He joined Liberty House last month to spearhead Liberty’s steel businesses in Scotland, which was bought from Tatas in a deal involving the Scottish government.

Gupta has to modify his earlier plans to shut the blast furnace at Port Talbot and covert it into an electric arc furnace to make steel by recycling rather than using iron ore.

Pension scheme

Tata Steel’s hunt for a buyer to save the British business could be hampered by the firm’s £15 billion pension scheme, which has a deficit of £485 million.

It has over 130,000 savers who are entitled to pension. Tata Steel has agreed with the trustees to eliminate

the shortfall completely by 2026.

Sent to England at the age of 12, Gupta never returned to India.

He worked briefly for his father’s business selling bicycles in Turkey before accepting an offer to study

economics at Trinity College, Cambridge.

Even while in college, Gupta’s acumen for business led him to sell chemical products to Nigeria and generate turnover of £1 million a day.

After graduating in 1995, he began trading commodities around the world. His business interest are always

intertwined with that of his father PK Gupta’s in steel, shipping, power and commodities.

For instance, when Liberty invested in a steel-making venture in South Wales, PK’s Simec bought the adjacent power plant to supply power to the mills.

Gupta met his wife Linda who was treasurer of one of his businesses and they have three children.

Today, the commodities trading firm Liberty House has a turnover of about $6.5 billion and employs 2,000 people globally.

25. Paytm goes global

Business Standard | May 04, 2016

New Delhi: Soon, 126 million Paytm users will be able to use their mobile wallet to make payments at several international supermarket chains, hotels and for cab travel in more than 16 countries.

Paytm plans to go global by the end of this year through its association with Alipay, owned by Alibaba Group.

Beginning with 16 countries, Paytm’s international reach will grow every time Chinese mobile payment major expands its international footprint.

Vijay Shekhar Sharma, the founder and CEO of One97-owned Paytm said his company has been working

with Alipay to make Paytm a global wallet.

“So what is happening behind the scene is that Paytm and Alipay are building a global network, while Alipay is working on global acceptance, Paytm is acquiring local consumers.” It has signed up with Uber and Macys among others. Soon, every business that accepts Alipay would also accept Paytm, he said.

He said while the card companies were riding the payment network ecosystem because of global acceptance so far, wallet companies were lagging behind.

The move is to make Paytm wallet as effective and relevant globally as a Visa or MasterCard.

Sharma added that the integration of Paytm’s backend with Alipay has started and would be completed by the end of this year.

“Effectively Paytm goes global after deep integration with Alipay is complete, by end of this year. Some elements of that would start coming in by end of this month. Before this year end, Paytm wallet would be accepted globally,” he added.

As far as government regulations around such transactions are concerned, Sharma said his plans for global expansion were well within government guidelines. “RBI guidelines say that wallets can only pay in Indian

currency, so international currency payments which are in dollars, or any other currency, need to be converted into rupee and the deduction has to be in rupee. That part Alipay would take care of,” he said. It means that Alipay’s software at the backend would convert the dollar amount into rupee on the spot and charge money accordingly. Alipay is accepted in 16 countries, including Southeast Asia and the US. It is expanding in South America and Europe. The process has been kick-started with a 3-way partnership between Alipay, Uber and Paytm.

Now, Indians travelling abroad would be able to pay for their Uber rides through Paytm.

Uber on Tuesday said a new partnership with China’s Ant Financial Services Group and India’s Paytm will

allow Chinese and Indian users travelling abroad to pay for their rides in more than 400 cities.

Under the tie-up, customers would be able to pay for their international rides directly in RMB or Rupee using an Alipay or Paytm account. At the backend, calculation would be done according to the day’s exchange rate and the amount would be charged in local currency.

The integration would also allow Paytm users travelling abroad to book Uber rides without downloading Uber’s app.

In return, Uber would get access to 450 million users of Alipay and over 126 million users of Paytm. Also,

Paytm said it will not charge any hidden fee for conversion and will convert based on current Forex cards.

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

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