AAPI: March 2020

DELHI, 20th March 2020

Index of this Newsletter

INDIA

INDIA & THE WORLD

21.Ties, knots and new highs in the India-US strategic partnership
22.HAL eyes base in four nations to push 'made-in-India' defence products
23.Work from home is the bug fix for technology companies operating in India
24.1. Mahindra starts assembling vehicles in Kenya
24.2. M&M to launch a tractor platform jointly with Mitsubishi
25. Toyota Kirloskar Motor launches self-charging hybrid electric vehicle Vellfire

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DELHI, 20th February 2020

NEWSLETTER, 20-III-2020

INDIA

– GENERAL POLICY, INFRASTRUCTURES, COUNTRY FINANCES, ETC.

1. Indian economy braces for coronavirus-induced shock as curbs set to pull down growth

Livemint, 15 Mar. 2020, Asit Ranjan Mishra, Gireesh Chandra Prasad

Slowdown in consumption, curbs on travel and other restrictions set to pull down growth, have a toxic impact on the economy

India will be the 10th most impacted economy due to supply chain disruptions in China, according to UNCTAD estimates

New Delhi: A fledgling recovery in Asia’s third-largest economy is set to lose steam as travel curbs and closure of malls, theatres and educational institutes, among other steps aimed at containing the Covid-19 outbreak in India, have led to a significant drop in economic activity.

The pandemic has hit the economy at a time when growth has slowed to the lowest in a decade, investments are shrinking and a consumption recovery is sputtering. This has prompted economists to pare India’s growth projection for 2020-21 closer to 5% from about 6% earlier. Moody’s Investors Service said Covid-19 will likely depress global growth in 2020 below 2.5%, the recessionary threshold for the world economy.

A sustained pullback in consumption, coupled with extended closures of businesses, would hurt earnings of Indian companies and drive layoffs. That could spell trouble for the government’s existing spending programme as tax collections will remain subdued. The finance ministry on Saturday raised taxes on petrol and diesel by ₹3 each to shore up revenue, taking advantage of a sharp fall in crude oil prices.

In response to a query from Mint on Saturday, finance minister Nirmala Sitharaman said the government is in the process of making an assessment of the impact the Covid-19 outbreak may have on the economy. “We are trying to make an assessment by talking to the industry including the services sector and sections of society. I don’t think we have arrived at (a conclusion) as yet," the minister said.

Losses of consumer and investor confidence are the most immediate signs of a contagion, analysts said. “Covid-19 has added a supply-side dimension to the demand problem that the Indian economy is already battling. That can have a very toxic impact on the economy. The real issue is how long it will last," said Pronab Sen, a former chief statistician of India.

With precautionary steps progressively being taken on movement and congregation of people, demand for products such as consumer durables, automobiles and homes will also get affected, said Madan Sabnavis, chief economist at Care Ratings. “Lenders, especially banks, have to be more watchful as this could lead to a spike in non-payment of interest as business levels come down," he said.

A further demand slowdown could trigger a vicious downward spiral at a time the economy was witnessing a nascent recovery in factory output in January and merchandise exports in February. Not only will it further delay an investment recovery, it will make it difficult for the government to stick to the fiscal deficit target of 3.5% of gross domestic product (GDP) in 2020-21.

“If the recent virus outbreak leads to prolonged business disruptions and dysfunctional supply chains, it could have an adverse impact on revenue collections as goods and services tax is a transaction-based tax," said M.S. Mani, a tax partner at Deloitte India.

(Graphic: Ahmed Raza Khan/Mint)

The immediate victim of the curbs placed to contain the spread of Covid-19 has been the aviation sector with up to 75% drop in international bookings and 20% drop in domestic bookings, according to industry estimates. India’s largest domestic carrier IndiGo last week said the threat of Covid-19 has begun to affect bookings which could impact its March quarter earnings. A decline in company earnings could mean lower corporate tax collections for the government at a time it has set an ambitious target of 11.5% growth in corporate tax receipts for 2020-21.

A lockdown in India’s major export destinations such as China and Europe is also impacting India’s export earnings. India will be the 10th most impacted economy due to supply chain disruptions in China, with chemicals, textiles and apparel, automotive industries at the forefront of the disruption, according to a preliminary estimate by UNCTAD on 6 March. With the World Health Organization declaring Europe to be the new epicentre of the Covid-19 outbreak, exports to the European Union, which is India’s largest exports destination, are bound to be affected.

During 2019, India’s exports to the European Union (EU) stood at $55.7 billion, contracting by 2.9% from the preceding year. Among major items, India exports chemicals, machines, garments, gems and jewellery, iron and steel and pharmaceutical items to the EU.

While the situation in China has stabilized substantially with reports of factories resuming work, it may take time to completely normalize the supply disruption.

While India’s exports are getting negatively impacted due to a lockdown in some of India’s leading trading partners like China, Italy and Germany, even in other countries, buyers are going very slow, said Sharad Kumar Saraf, president, Federation of Indian Export Organisations. “Job losses mainly in labour-intensive sectors such as gems and jewellery, handicrafts and carpets are already happening. One sector which is doing okay is garments. The sector has got some respite as some Chinese orders came to us. But overall, it’s a very depressing scenario," he added.

To minimize the economic impact of Covid-19 on vulnerable families, countries such as France, Japan and South Korea are giving wage subsidies. China is accelerating payments of unemployment benefits and easing tax burden on small firms. The US House of Representatives on Saturday passed a bill expanding paid medical leaves and food assistance programmes as well as unemployment benefits to the affected.

Saraf said government needs to immediately announce a set of measures to alleviate the pain of affected workers and companies. “We have requested the finance minister not to declare any loans by exporters bad because there will be delay in receipt of payments and to extend repayment period from 120 days to 180 days. Particularly, MSMEs are very badly affected. They should be given some soft loans to overcome the present crisis," he added.

2.1. From 1984 to 2020: A tale of two ‘riots’

Livemint, 28 Feb. 2020, Sonia Sarkar

For survivors of the anti-Sikh pogrom of 1984, the targeted violence of the Delhi riots of 2020 triggers painful memories

The images of burnt cars, plumes of smoke engulfing the Delhi sky and men throwing petrol bombs at shrines that played out on social media from north-east Delhi this week triggered painful memories of the anti-Sikh pogrom of 1984 for Santokh Singh. He was barely 5 then but the scenes of violence are still etched in his mind.

“(The violence over the last few days) looks like a replay of the 1984 violence against Sikhs," says Singh, who lives and works as a driver in Tilak Vihar in west Delhi.

About 3,000 Sikhs in Delhi were killed in violence soon after former prime minister Indira Gandhi was killed by her two Sikh security guards on 31 October 1984.

“The two differences between the violence of 1984 and that of 2020 are that Sikhs were targeted then, Muslims are being targeted now; it was the Congress at the helm then, Bharatiya Janata Party (BJP) is at the helm now," says Singh. Singh adds that he is disappointed the Aam Aadmi Party-led Delhi government also did not do much initially. “A loss of life is a loss, nothing can compensate it," he says.

Just like the anti-Sikh violence in 1984, when men in the age group of 20-50 were targeted, this time too most of the dead are men from the same age bracket.

Singh recalls his father, a rickshaw-puller, who was burnt alive along with three others in a locked house in Sultanpuri, where he was hiding from the rioters. “Our slum was burnt down but we escaped. My father ran away from work to reach home but he never reached," he says. “There was no help from the police or the administration to locate him”.

This week, the desperate calling out for help by victims of the ongoing violence in areas of north-east Delhi reportedly went unanswered. More than 35 people have been killed since violence broke out on 23 February. The Delhi police has come under criticism for not doing enough.

Supreme Court lawyer Tajinder Pal Singh Nalwa, 54, from Janakpuri in west Delhi, who lost his cousin and a friend in 1984, refuses to term the ongoing violence “riots", just as he never termed the 1984 violence “riots". “The state was a mute spectator when mobsters attacked people then, it’s exactly the same now," says Nalwa, who had turned 18 soon after the riots broke out in 1984.

Indeed, there are similarities with the 1984 violence, says human rights activist Gautam Navlakha. In 1984, attackers, mostly young men “armed with swords, daggers, spears, steel trishuls (tridents) and iron rods were ruling the roads", according to a fact-finding report jointly prepared by civil society organizations People’s Union for Civil Liberties (PUCL) and People’s Union for Democratic Rights (PUDR). The report added that these men shouted provocative slogans.

This time, slogan-shouting attackers have been armed with hammers, sickles and axes, even guns. And there are casualties on all sides.

Navlakha, who was part of the fact-finding team of PUCL-PUDR in 1984, says: “Even in 1984, the police were either absent or present only in few numbers or played a partisan role in helping the mobsters, just as they are doing now."

Navlakha adds that the genesis of the current spell of violence is different. “One must not forget the range of events that happened before this violence"—the crackdown on protesters against the Citizenship (Amendment) Act (CAA) in Jamia Millia Islamia, the attack in Jawaharlal Nehru University (JNU), and the molestation of Gargi College students. Additionally, there were hate speeches by former Delhi MLA and BJP leader Kapil Mishra ahead of the Delhi assembly elections earlier this month that the Bharatiya Janata Party lost.

Navlakha sees the visit of national security adviser (NSA) Ajit Doval to the violence-hit areas as a sign that the police machinery has collapsed. “Mobsters can move freely and with impunity only when they have the sanction of powers that be. The Union home ministry controls this police force, which seems unable to catch the mobsters.... It is organized violence, not sporadic."

The PUCL-PUDR report on the 1984 violence noted that it was “far from being a spontaneous expression of ‘madness’ and of ‘popular grief and anger’ at Indira Gandhi’s assassination", as suggested by the authorities. It was, rather, “the outcome of a well-organised plan marked by acts of both deliberate commissions and omissions by important politicians of the Congress (I) at the top and by authorities in the administration." For years, Congress politicians have been blamed for inciting mobs. It was only in December 2018 that one of them, Sajjan Kumar, was sentenced to life imprisonment by the Delhi high court.

According to media reports, the families of victims of the current violence have blamed the “incendiary" speech by Mishra for the violence. In a video posted on social media, Mishra had given a three-day ultimatum to Delhi police to clear roads in the Jaffrabad and Chand Bagh areas of north-east Delhi where protests against CAA were taking place. He had said, “We would not even listen to you if the roads are not vacated."

Over three days starting 23 February, the rioters took over roads, killing, burning property and looting. In 1984, the attackers had set Sikh homes, shops and gurdwaras on fire.One of the most brutal tactics was to “garland" Sikh men with tyres and set them alight.

As the images played on the mobile phone of 57-year-old Harbans Kaur of Mangolpuri in north-west Delhi, she was reminded of the attackers of 1984 too.

Singh recalls that his fearful mother made him don his sister’s white dress, and tied his hair into two plaits, in an effort to save him. “There was no other way, perhaps, that my mother could have saved me," he says.

Harminder Kaur of Tilak Vihar, who lost her brother to the 1984 violence, says the wounds have not healed. “The landscape of Delhi has changed over three decades, with the newly built Metros and flyovers. On the surface, it looks like Delhi has changed a lot. But sadly, nothing has changed as far as the vulnerability of the minorities is concerned. They still live in fear," she says.

Singh says nobody really remembers the families once the violence ends. “They keep picking up pieces of their scattered lives. Questions remain unanswered forever. I still don’t know what happened to my father’s body," says Singh.

Nalwa says the only ray of hope each time is that people from every community also step forward to help their neighbours. “It is this attitude of people which keep us going," says Nalwa.

Sonia Sarkar is a journalist covering south and south-east Asia.

2.2. How the ‘public’ betrays the people

Livemint, 28 Feb. 2020, Girish Shahane

Instead of intruding into the private lives of citizens, government should seek to increase its accountability and transparency to the people

After large portions of Mumbai’s GST Bhavan were destroyed in a fire on 17 February, the city’s chief fire officer, P.S. Rahangdale, told a municipal committee looking into the accident that he could not assess whether any of the construction was illegal because government buildings were not covered by the Maharashtra Fire Prevention and Life Safety Measures Act, 2006. His staff had no power to inspect and certify buildings like GST Bhavan. While citizens who want to make even minuscule alterations to their homes have to jump through a dozen procedural hoops, the government functions with minimal oversight. There is one law for the people, and another for public institutions.

The Antiquities and Art Treasures Act, 1972, is an excellent example of the double standard. The legislation, passed to stem the flow of artefacts and jewellery out of India, imposes a high compliance burden on citizens. Virtually all privately owned artefacts over 100 years old—including coins, paintings, sculptures, furniture, textiles, manuscripts and ornaments—have to be registered with the Archaeological Survey of India (ASI). Museums and other public collections, on the other hand, are under no such obligation. Very few, if any, have compiled comprehensive catalogues of items in their possession.

The late fashion designer Wendell Rodricks was angered by a registration drive launched by the ASI in September, which gave citizens 15 days to list antiquities they owned. In an open letter to the Goa state wing of the ASI, he asked why Goans living in centuries-old homes in which virtually every object was antique should be expected to tally dozens or hundreds of possessions while the government did nothing of the kind on its own turf. “Are government offices above the law?" he asked, while alleging, “The Cabo/Raj Bhavan has been looted by successive governors of its antique furniture, porcelain and silver." In the end, not a single artefact was registered with Goa’s ASI in those two weeks. The very existence of the antiquities law, however, provides governments an additional lever to go after people they deem a threat.

At the Think India Dialogue in April 2013, Narendra Modi, then chief minister of Gujarat, broached the idea of expanding public-private partnerships to “P4", or “people private public partnerships". In order to implement P4, he said: “People should get a chance to speak before a government decision is taken. This will make people feel like they have had a role to play." At first glance, his addition of “people" to “public" seemed redundant, for the definition of public is “the people as a whole". However, “public" also means “of or relating to a government", and Modi had put his finger on the fact that India’s public institutions did not represent people as they ought to have done.

When he became prime minister, my hope was that he would lighten the heavy hand of the state, increasing accountability and transparency of government while reducing its intrusiveness into private lives. Had he kept that promise, my distaste for his social policies would have been tempered by admiration for his elimination of red tape.

Sadly, Modi has sought to make government more opaque to citizens while making private lives more transparent to government. In a variety of ways, his administration has hobbled the Right to Information Act (RTI)—by far the most significant augmentation of government transparency in decades—something the UPA government also attempted. The government dragged its feet in filling vacancies in the Central Information Commission until forced by court orders. At one point near the end of 2018, eight of the 11 posts of election commissioner were unfilled, and the number of pending queries had risen to unmanageable levels. On issues such as demonetization, the deal to purchase Rafale jets from France, and the university records of ministers, the administration exempted itself from providing details requested under RTI rules. Soon after Modi was re-elected last year, his government amended the RTI law to take control over the tenures and salaries of information commissioners, diminishing the autonomy and stature of the Information Commission.

Meanwhile, in August 2017, the Supreme Court handed the people a victory by upholding privacy as a fundamental right. That same month, the government constituted a committee headed by Justice B.N. Srikrishna to identify issues related to data protection and draft a Bill regarding the processing and access of data. The committee’s recommendations, produced the following year, left the ruling party unsatisfied, despite giving the government powers of surveillance wide enough to worry civil rights activists.

The final draft of the Personal Data Protection Bill, tabled in Parliament in December, dismayed Justice Srikrishna, who said it contravened the Supreme Court’s verdict on the right to privacy and had the potential to “turn India into an Orwellian state". The very title of the Bill evoked Orwell’s concept of doublespeak, since the law, while ostensibly about protecting private information, was mainly concerned with enhancing the state’s access to such data.

The latest conflict between “public" and “people" concerns a physical space, the symbolic heart of India’s democracy, an area of Delhi called the Central Vista which the government is seeking to remodel. No consultations were conducted before HCP Design, Planning & Management was nominated the winner from among a mere six bidders for the Central Vista contract. The urban development ministry rejected the demand made by several architecture firms to establish an open competition for the iconic precinct’s redesign. It refused to release details of the bids, or of the composition of the jury that made the final choice. Despite ambitious timelines being set for the project’s completion, there is no clarity yet on the fate of a number of heritage structures that lie along Rajpath, or on the future of institutions like the National Museum and the Indira Gandhi National Centre for the Arts—though Bimal Patel of HCP has given interviews on his vision for the redesign. So much for making people feel they have a role to play in governance.

To facilitate the Central Vista’s makeover, the Delhi Development Authority (DDA) changed regulations in its master plan, a manual meant to guide “the sustainable, planned development of the city". According to the Indian Institute of Architects, modifications to the DDA’s land use regulations will mean that at least 80 acres currently marked for use by ordinary citizens will now be corralled by the government. Delhi residents and many tourists to the city have a deep emotional connection to the area around India Gate. How likely is it that the people of India will continue to have the same access to these spots once the government’s land grab is complete?

Girish Shahane writes on politics, history and art.

3.1. CCEA approves Creation of National Technical Textiles Mission

IBEF: February 27, 2020

The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Shri Narendra Modi, has given its approval to set up a National Technical Textiles Mission with a total outlay of Rs 1,480 crore (US$ 211.76 million), with a view to position the country as a global leader in Technical Textiles. The Mission would have a four year implementation period from FY 2020-21 to 2023-24.

Technical Textiles are futuristic and nice segment of textiles, which are used for various applications ranging from agriculture, roads, railway tracks, sportswear, health on one end to bullet proof jacket, fireproof jackets, high altitude combat gear and space applications on other end of spectrum.

The Mission will have four components:

1. Component -l (Research, Innovation and Development) with outlay of Rs 1000 crore (US$ 143.08 million)

This component will promote both:

(i) fundamental research at fibre level aiming at path breaking technological products in Carbon Fibre, Aramid Fibre, Nylon Fibre, and Composites and

(ii) application based research in geo-textiles, agro-textiles, medical textiles, mobile textiles and sports textiles and development of biodegradable technical textiles.

The fundamental research activities will be based on 'pooled resource' method and will be conducted in various Centre for Scientific & Industrial Research (CSIR) laboratories, Indian Institute of Technology (IIT) and other scientific/industrial/academic laboratories of repute. Application based research will be conducted in CSIR, IIT, Research Design & Standards Organisation (RDSO) of Indian Railways, Indian Council of Agricultural Research (ICAR), Defence Research & Development Organisation (DRDO), National Aeronautical Laboratory (NAL), Indian Road Research Institute (IRRI) and other such reputed laboratories.

2. Component -II (Promotion and Market Development)

Indian Technical Textiles segment is estimated at US$ 16 Billion which is approximately 6 per cent of the US$ 250 billion global technical textiles market. The penetration level of technical textiles is low in India varying between 5-10 per cent against the level of 30-70 per cent in developed countries. The Mission will aim at average growth rate of 15-20 per cent per annum taking the level of domestic market size to US$ 40-50 billion by the year 2024; through market development, market promotion, international technical collaborations, investment promotions and 'Make in India' initiatives.

3. Component - III (Export Promotion)

The component aims at export promotion of technical textiles enhancing from the current annual value of approximately Rs 14,000 crore (US$ 2 billion) to Rs 20,000 crore (US$ 2.86 billion) by 2021-22 and ensuring 10 per cent average growth in exports per year up to 2023-24. An Export Promotion Council for Technical Textiles will be set up for effective coordination and promotion activities in the segment.

4. Component- IV (Education, Training, Skill Development)

Education, skill development and adequacy of human resources in the country is not adequate to meet the technologically challenging and fast-growing technical textiles segment. The Mission will promote technical education at higher engineering and technology levels related to technical textiles and its application areas covering engineering, medical, agriculture, aquaculture and dairy segments. Skill development will be promoted, and adequate pool of highly skilled manpower resources will be created for meeting the need of relatively sophisticated technical textiles manufacturing units.

The Mission will focus on usage of technical textiles in various flagship missions, programmes of the country including strategic sectors. The use of technical textiles in agriculture, aquaculture, dairy, poultry, etc. Jal Jivan Mission; Swachch Bharat Mission; Ayushman Bharat will bring an overall improvement in cost economy, water and soil conservation, better agricultural productivity and higher income to farmers per acre of land holding in addition to promotion of manufacturing and exports activities in India. The use of geo-textiles in highways, railways and ports will result in robust infrastructure, reduced maintenance cost and higher life cycle of the infrastructure assets.

Promotion of innovation amongst young engineering /technology/ science standards and graduates will be taken up by the Mission; along with creation of innovation and incubation centres and promotion of 'start-up' and Ventures'. The research output will be reposited with a ‘Trust’ with the Government for easy and assessable proliferation of the knowledge thus gained through research innovation and development activities.

A sub-component of the research will focus on development of biodegradable technical textiles materials, particularly for agro-textiles, geo-textiles and medical textiles. It will also develop suitable equipment for environmentally sustainable disposal of used technical textiles, with emphasis on safe disposal of medical and hygiene wastes.

There is another important sub-component in the research activity aiming at development of indigenous machineries and process equipment for technical textiles, in order to promote 'Make in India' and enable competitiveness of the industry by way of reduced capital costs.

A Mission Directorate in the Ministry of Textiles headed by an eminent expert in the related field will be made operational. The Mission Directorate will not have any permanent employment and there will be no creation of building infrastructure for the Mission purpose. The Mission will move into sunset phase after four years period.

Background of Technical Textiles:

Technical textiles are textiles materials and products manufactured primarily for technical performance and functional properties rather than aesthetic characteristics. Technical Textiles products are divided into 12 broad categories (Agrotech, Buildtech, Clothtech, Geotech, Hometech, Indutech, Mobiltech, Meditech, Protech, Sportstech, Oekotech, Packtech) depending upon their application areas.

India shares nearly 6 per cent of world market size of US$ 250 billion. However, the annual average growth of the segment is 12 per cent, as compared to 4 per cent world average growth.

Penetration level of technical textiles is low in India at 5-10 per cent, against 30-70 per cent in advanced countries. The Mission aims at improving penetration level of technical textiles in the country.

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

4. EESL plans to set up 1,500-MW decentralised solar power plants by 2021

IBEF, Feb. 27, 2020

State-owned Energy Efficient Services Ltd (EESL) has forayed into solar power generation and intends to set up 1,500 MW of decentralised solar power plants across the country by the end of 2020-21, its managing director, Mr Saurabh Kumar said.

The Maharashtra government had given mandate for 800 mw of solar power, out of which EESL has already operationalised 100 MW whereas EESL was given order to set up 113 MW of solar distributed generation projects in Rajasthan, Mr Kumar added.

In Maharashtra, EESL is supplying electricity at Rs 3.10 (US$ 0.04) per unit to agriculture feeders, with land for the project being provided by the state while in Rajasthan, the company will supply power at Rs 3.90 (US$ 0.055) per unit along with land acquisition cost, he said.

Though, the company plans not to set up solar capacity of more than 10 MW at one location, said Mr Kumar, further adding that the capacity of these solar power plants in each substation ranges from 0.5 MW to 10 MW.

According to Mr Kumar, the decentralised solar plants will meet the requirements of farmers connected to the agriculture feeder. He said EESL has installed 1.1 million smart meters in New Delhi Municipal Corp area, Uttar Pradesh, Haryana and Bihar. EESL has set a target of installing 250 million smart meters over the next few years.

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

5. Instead of a task force, delaying marriage needs more education

Livemint, 17 Feb. 2020, Rukmini S

Indian men and women are getting married later than ever with education and wealth being the biggest determinants of age at marriage, shows data

Among the surprise announcements in the Union budget 2020-21 was the formation of a task force to review the minimum age of marriage for women. The announcement refocused attention on identifying whether there is an issue and what that issue really is.

Since 1978, the legal age for marriage in India has been 18 years for women and 21 years for men. The age for women is in line with global norms, but just one in five countries globally have a different age requirement for men. This has been raised in the past.

In 2008, the 18th Law Commission recommended making 18 years the minimum age for marriage for both men and women.

The government now, however, intends to go in a new direction—raising the age at marriage for women, so that they delay childbirth, study longer and are healthier. These are laudable objectives. However, is a law needed for this, and will it work?

Despite the minimum age for marriage remaining unchanged since 1978, both men and women have been getting married later and later. Nearly half of married women now in their 40s were married by the time they were 18, but among women currently in their early 20s, that proportion is down to just 25%. The share of men married before they were 21 is even lower now.

Since the 1970s, women were more likely to marry someone older than them than someone of the same age or younger. It is only in the 2000s that this equation flipped. Indian women are now more likely to marry someone around the same age as them than someone older, shows data from the India Human Development Survey (IHDS) analysed by demographer Sonalde Desai and her colleagues.

The average age gap between the husband and wife has changed little over the last decade, remaining at around five years. However, among newly married women in their 20s, this gap has shrunk, indicating that the age gap over the next decade might be much narrower.

As the age at which women get married has increased, so has the age at which women have their first child. The median Indian woman now has her first child at age 21, two years after she gets married. However, one in five women still had their first child before she turned 18.

Yet, what these medians hide is that a quarter of newly married young women got married before the legal age and more than 10% of women had a child while still a minor. So, is the government right in thinking that a new law will push women to study longer and delay marriage and motherhood? For both marriage and childbirth, the evidence from the National Family Health Survey (NFHS) and the IHDS show that urban women and those who are richer and better educated marry later. The poorest 40% of women are the ones who marry before 18, as are those with no schooling or with only basic primary education, and those from the poor states of West Bengal, Bihar, and Jharkhand. Women who have completed their schooling have their first child five years later on average than those who have finished less than five years of schooling.

Instead of a new law, the government could consider adopting a carrot-and-a-stick approach. The presence of women in local government decreases the likelihood of child marriage and states with greater enforcement capacity are those with fewer child marriages.

How does one encourage girls to stay in school longer? In the most recent National Sample Survey report on education, girls did report marriage being one of the reasons for dropping out. However, financial constraints and the need to look after domestic work were greater considerations for dropping out.

Rukmini S. is a journalist based in Chennai

- AGRICULTURE, FISHING & RURAL DEVELOPMENT

6. Nestlé India’s third quarter earnings show why it’s the priciest FMCG stock

Livemint, 16 Feb. 2020, Pallavi Pengonda

The company’s stock trades at about 69 times estimated earnings for FY20, based on Bloomberg data
The company has been able to clock double-digit domestic sales growth consistently in the past few quarters

In the Indian fast-moving consumer goods (FMCG) world, Nestlé India Ltd is the odd man out. At a time when FMCG firms are finding it difficult to boost sales, Nestlé India’s December quarter year-on-year revenue growth of 8.7% is much better than that of its peers. As the chart shows, the firm’s growth is more than double the industry average growth rate of 4%.

“Steady show in a weak environment affirms Nestlé India’s supremacy," said analysts at SBICAP Securities Ltd in a report on 13 February.

Of course, investors took note of this. The Nestlé India stock touched an all-time high on NSE in Friday morning’s early deals. In fact, the stock of the company, popular for its Maggi noodles, is the priciest in the FMCG sector as far as valuations go. The stock trades at about 69 times estimated earnings for 2020, based on Bloomberg data. Nestlé India follows a January to December fiscal year. In comparison, shares of FMCG leader, Hindustan Unilever Ltd, trade at 56 times estimated earnings for FY21.

Nestlé India’s domestic sales, which account for 94.5% of revenue, have increased by 10% year-on-year. The company has clocked double-digit domestic sales growth consistently over the past few quarters. Exports, which account for the remaining revenue, have declined by nearly 10%, as coffee exports to Turkey were lower. However, since exports form a smaller portion of its overall revenue, it doesn’t move the needle in a big way.

Gross profit margins contracted by a little over 200 basis points. A basis point is one-hundredth of a percentage point. Higher commodity prices, especially those of milk and its derivatives, weighed on gross profit growth. “The trend of higher commodity prices witnessed in recent quarters is likely to continue in the near future," said the company.

Thankfully, other expenses declined, helping Ebitda (earnings before interest, tax, depreciation and amortization) margins to expand slightly.

Overall, Nestlé India’s net profit of ₹473 crore is marginally ahead of a poll of Bloomberg analysts’ estimates.

Where do we go from here? Analysts expect the company’s relatively better run on revenue to continue. “Growth visibility remains better than peers but upsides to earnings are not visible given steep input inflation and higher spends to drive growth," said analyts at Emkay Global Financial Services Ltd in a report on 13 February.

In any case, Nestlé India’s valuations suggest a good share of the optimism is baked into the stock. According to SBICAP, current valuation calls for sustained 20%-plus earnings growth. And, this is a tall ask.

7.1. Virgin targets UK-India trade

Fruitnet, 26 Feb. 2020, Jim O’Callagam

Virgin Atlantic Cargo will launch a new direct service between Delhi and Manchester before the end of 2020

In an attempt to gain a bigger share of the trade between the UK and India, Virgin Atlantic Cargo has launched a new, direct, Manchester-Delhi service.

Starting on 26 October 2020, the airline will operate three A330-200 flights every Monday, Thursday and Saturday as part of its growing commitment to the Indian market.

According to Virgin Atlantic, fresh fruit and vegetables make up a notable portion of the 100,000 tonnes of imports and exports moving between the UK and India by air each year.

The new route will also provide a link for US to access India as Virgin Atlantic operates flights from New York, Atlanta and Orlando to Manchester.

Dominic Kennedy, managing director of Virgin Atlantic Cargo, said this was a great opportunity for Virgin Atlantic and its customers to make the most of the growing trade between the two countries.

“Business opportunities between the UK and India have never been greater. India is now the world’s fifth-largest economy and the UK is one of its biggest and fastest-growing trading partners for products such as technology and automotive components, pharmaceuticals and fresh produce as well as other general cargoes,” said Kennedy.

“The launch of direct flights to India from Manchester this October will give exporters and importers more choice in addition to the three times daily services we will be operating from Heathrow, offering exciting new growth opportunities for us and our customers.”

7.2. Maersk connects Indian grapes to Europe

Eurofruit, 4-Mar. 2020, Liam O’Callagham

Indian grape exporters will have an end-to-end cold chain connection to North Europe with a new service from Maersk

Maersk has announced a new service to North Europe that offers an end-to-end cold chain logistics solution for grape exporters from Nashik and Sangli.

The new service enables booking management, offers on-land and ocean transportation, cargo tracking, customs clearance amongst other services as a part of the end-to-end solution. All of this is set to improve the overall turnaround time to North Europe by four days.

The grapes will be transported in reefer containers with a remote container management solution that monitors atmospheric conditions inside the container and provides visibility of the same to the customers.

Steve Felder, managing director of Maersk South Asia, said the all-encompassing service is aimed at streamlining the shipping process for exporters.

“Nashik is a priority market for the exports of grapes from India. With our end-to-end cold chain solutions, we aim to enable the exporters to take their grapes from Nashik to North Europe with a fast turn-around time, and with more simplicity,” Felder said.

“By providing a one-stop-shop solution, we are enabling the farmers to focus on what they do best, leave the logistics to us and not get bothered by any challenges that they might face in the journey of their produce from their farms to their customers.”

Felder said Maersk hoped this development would help increase opportunities exporters of all fresh produce in India.

“Besides grapes, the region also yields other quality agro-produce like onions, tomato, chilli, baby corn, okra and other vegetables, which have immense trade potential in the global markets,” Felder

“With our cold chain logistics solutions, we aim to further open-up and liberalise the agro-economy of the country enabling farmers and entrepreneurs to be a part of the international trade ecosystem.”

Mayank Tandon, vice-president of FreshTrop, applauded Maersk’s cold chain solution and said it has plenty of potential.

“We are extremely excited about the value proposition of Maersk’s cold chain solution. As a unique proposition in the industry, it has the potential to add great value by the virtue of visibility it offers us on our cargo,” Tandon said.

“We are looking forward to serving our customers better with the tools that Maersk has placed in our hands through a single window solution for our logistic needs.”

8.1. KALA KUMBH - Handicrafts Exhibitions for promotion of GI Crafts

IBEF, Feb. 19, 2020

With an objective to promote Geographical Indication (GI) crafts and heritage of India the Ministry of Textiles is organising Kala Kumbh - Handicrafts Thematic Exhibition in various parts of the country through the Office of Development Commissioner (Handicrafts). The exhibitions are planned in various major cities like Bengaluru, Mumbai, Kolkata and Chennai. The exhibitions sponsored by Export Promotion Council for Handicrafts (EPCH) started on 14th February 2020 and will continue till 23rd February 2020 at Bengaluru and Mumbai and will also be organized in Kolkata and Chennai in March 2020.

The GI tag is used on handicrafts which correspond to a specific geographical location or origin (e.g., a town, region, or country). As on August 2019, 178 GI handicraft products were registered from all over India. The artisans are the backbone of Indian handicraft sector and possess inherent skill, technical and traditional craftsmanship.

During the 10 day exhibitions, the visitors will be able to see a wide variety of handicrafts with their friends and family and by buying these handicrafts they can directly contribute in the improvement of the livelihood of these artisans and also create awareness of the rich heritage of the country.

In Bengaluru exhibition, GI crafts like Mysore rosewood inlay, Channapatna lacquerware, Dharwad kasuti embroidery, Kolhapur chappal, Bidriware, Molakalmur handblock printing, Ananthapur leather puppet, Thrissur screwpine, Vishakapatna lacquerware, Sandur lambani embroidery, Jodhpur terracota, Jaipur handprinted textile, bronze casting, Medinipur mat weaving, Birbhum artistic leather and Khurdah palm leaf engraving are being displayed.

In Mumbai exhibition GI crafts like Chittoor kalamkari painting, Thrissur screwpine crafts, Pokharan terracotta crafts, Kutch embroidery & crochet crafts, Pingla patachitra, Birbhum kantha embroidery, Jajpur photachitra painting, Madhubani Mithila painting, Kolhapur chappal, Palghar Worli painting, Kondagaon wrought iron craft, Agate stone crafts and Krishna handblock printing are being displayed.

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

8.2. Jan Aushadhi Scheme to provide best and affordable medicines, says PM

IBEF, Mar. 09, 2020

The Prime Minister, Shri Narendra Modi, interacted with the beneficiaries of Pradhan Mantri Bhartiya Jan Aushadhi Pariyojana and store owners of Jan Aushadi Kendras, through video conference.

The Prime Minister said Jan Aushadhi Day is not just a day to celebrate a scheme, but a day to connect with millions of Indians who are being benefitted from this scheme.

“We are working on four goals for the health of every Indian. First, that every Indian should be prevented from sickness. Second, there should be affordable and good treatment in case of illness. Third, to ensure that there are modern hospitals, adequate number of good doctors and medical staff for treatment. And, fourth goal is to meet challenges by working on the mission mode”, the Prime Minister added.

The Prime Minister said, Jan Aushadhi Scheme is an important link to provide best and affordable treatment to every person in the country.

“I am very satisfied that till now more than 6 thousand Janushadhi centres have been opened all over the country. As this network is growing, so too is its benefit reaching more people. Today every month more than one crore families are availing very affordable medicines through these centres”, he added.

The Prime Minister said the prices of medicines at Jan Aushadhi Centers are 50 per cent to 90 per cent less than the market. For example, a medicine used in the treatment of cancer which is available in the market for about Rs 6,500 (US$ 93), is available in Jan Aushadhi Centers for only Rs 800 (US$ 11.45).

“The cost of treatment is decreasing compared to before. I am told that till now, savings of Rs 2,200 crore (US$ 314.78 million) have been saved by crores of poor and middle-class Indians all over the country due to Jan Aushadhi Centers”, the PM said.

Prime Minister also commended the role of stakeholders running the Janaushadhi Centres. He also announced the decision to introduce awards related to Janaushadhi scheme to recognize the contribution of people associated with the Scheme.

Prime Minister said Janaushadhi scheme is also becoming a great means of confidence for youth including the disabled. Thousands of youths are employed in the process ranging from testing of generic medicines in labs to their last mile distribution in public health centres.

“The government is making every effort to expand health facilities in the country. Constant work is going on to make the Janaushadhi scheme also more effective”, he added.

Prime Minister said that about 90 lakh poor patients have received treatment under Ayushman Bharat scheme. More than 6 lakh dialysis has been done free of cost under the Dialysis Program. Also, price control of more than one thousand essential medicines has saved Rs 12,500 crore (US$ 1.79 billion). Millions of patients have got new life due to the reduced cost of stents and knee implants.

“By the year 2025, we are working fast to make the country TB free. Under this scheme, modern health and wellness centres are being built in every village of the country. Till date, more than 31 thousand centres are completed”, he added.

The Prime Minister, Shri Narendra Modi, urged every citizen of the country to understand his or her obligation towards health.

“We must give due importance to cleanliness, yoga, balanced diet, sports and other exercises in our daily routine. Our efforts towards fitness will prove the resolve of a healthy India”, he added.

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

9.1. Sugar exports to cross 5 MT this year

IBEF, Feb. 21, 2020

India’s sugar exports are estimated to cross 5 million tonne (mt) in the current marketing year ending September. According to industry body Indian Sugar Mills Association (ISMA), this is on the back of increased global demand because of a production deficit of 8-9 mt.

Though, this is still behind the 6 mt sugar exports target set by the government under the Maximum Admissible Export Quota (MAEQ) to help deal with the glut in sugar production in the 2018-19 marketing year. In the last sugar season, India had exported 3.8 mt against the mandatory quota of 5 mt.

ISMA, quoting analysts said the global sugar prices have increased by 20-25 per cent in the last three months, making it profitable for Indian sugar firms that are striking up new export deals. The sugar mills that have followed the government policy of exporting 25 per cent of their prescribed quota in October-December 2019 quarter are expected to be benefited by this increased sugar prices.

According to an official notification issued in January, the firms that did not meet the quota requirement may have to forfeit 20 per cent of the MAEQ, which will be reallocated to those who fulfilled it. Although, it is not clear that how many firms have fallen short of this requirement and how much of sugar exports redistributed among other sugar mills.

“Apart from the difficult situation faced by many mills in Maharashtra and Karnataka during the monsoon floods last year and the pending export subsidy of Rs 2,000 crore (US$ 286.16 million) from the government made it difficult for many sugar companies to meet the target,” said an industry representative.

According to the market reports by ISMA, around 1.6 mt sugar has been exported so far and contracts have been signed for exporting an additional 3.2 mt.

Till February 15,2020, sugar produced in the country by the sugar mills stood at 17 mt, nearly 23 per cent lower than the 22 mt sugar produced in the corresponding period of the previous sugar season.

Indian mills are expecting better prices for their exports as the prices of raw and white sugar are 20 to 25 per cent higher in the global market than three months ago. According to analysts, there is eight to nine million tonne shortfall in global production of sugar in the current sugar season.

The production of sugar by mills in Uttar Pradesh stood at 6.6 mt, compared with 6.4 mt last year whereas their counterparts in Maharashtra produced 4.3 mt, as against 8.3 mt in the same period last year. The contribution of Karnataka mills’ contribution so far was 3.1 mt as against 3.9 mt a year ago.

Mills in other States such as Tamil Nadu, Gujarat, Andhra Pradesh, Bihar, Chhattisgarh, Haryana, Madhya Pradesh and Punjab contributed the rest.

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

9.2. Surf Excels as HUL's top brand, nets over Rs 5,000 crore in sales

IBEF, Feb. 26, 2020

Surf Excel became the first Hindustan Unilever brand to top the mark by posting more than Rs 5,000 crore (US$ 715.41 million) in annual sales last year. This was mainly on the back of the company’s increased focus on premium products in the detergent market.

Surf was launched around 60 years ago and recorded sales of Rs 5,375 crore (US$ 769.07 million) in the past year with a market share of 17.9 per cent, according to the industry executives citing Nielsen data. It accounted for around 14 per cent of the company's net revenue and 45 per cent of its laundry segment sales. Though, no respond was provided by Nielsen.

In 2018, the laundry portfolio was outshined by Surf with the mass market Wheel brand which dominate the HUL’s portfolio. According to a spokesperson, the company’s efforts towards premiumisation of the segment through liquid detergents and fabric conditioners have yielded a strong result.

The spokesperson added, “HUL’s laundry category continues its growth momentum with performance driven by a relentless focus on core and market development initiatives”. In 1985, Ahmedabad-based Nirma took over Surf as the market leader in detergent category, leading to the launch of lower-priced Wheel by Surf to take on the new rival.

Wheel captured the top spot back for HUL and managed to hold the position between the early1990s till 2012, when Kanpur-based RSPL’s Ghari brand edged it to be the market leader. The gap between the two is narrow. The company added 1.8 percentage points over the past two years in market share, whereas Ghari’s share has remained unchanged at 19.2 per cent with annual sales of Rs 5,756 crore (US$ 823.58 million) in 2019.

According to a top RSPL, the company is aiming to push growth and expand market share. “We are launching machine wash variants, entering the modern trade channel and expanding geographical reach to generate higher sales growth this year,” said President Mr Sushil Kumar Bajpai. He added that though the brand has minor share in modern trade but is by far the leader in general trade.

HUL’s overall share in India’s laundry care market stood at 39.1 per cent of worth Rs 29,959 crore (US$ 4.29 billion) as company also owns Rin and Sunlight. HUL has been gradually launching higher priced variants and formats that led to the growth in the category to nearly 11 per cent for the company last year, compared with six per cent in 2018. As a result, HUL's share in the premium laundry market is more than 77 per cent, compared with 22 per cent in the mass segment and 44 per cent in the mid-priced.

The company introduced another premium product last year, which was Love & Care focused for special fashion fabrics. As the penetration of washing machines has increased and lower-priced detergent powders, laundry care consumers are shifting from bar detergents to powder detergents, a factor triggering growth in the category.

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

10.1. 32 projects sanctioned under Pradhan Mantri Kisan Sampada Yojana (PMKSY); Projects to leverage an investment worth Rs 406 crore

IBEF, Feb. 28, 2020

Meetings of the Inter-Ministerial Approval Committee (IMAC) were held under the Chairpersonship of Union Minister of Food Processing Industries Smt Harsimrat Kaur Badal at New Delhi. Total of 32 projects were sanctioned in these meetings under the ‘Unit’ scheme of PMKSY of Ministry of Food Processing Industries. The projects are spread across almost 17 States, leveraging an investment worth Rs 406 crore (US$ 58.09 million).

These projects envisage the creation of direct and indirect employment for approximately fifteen thousand persons along with employment opportunities in rural areas to be the focus area. The introduction of modern processing techniques for food results in improved shelf-life of the agricultural produce and ensure steady revenue to farmers. Food processing has an important role to play in linking Indian farmers to consumers in the domestic and international markets.

The Food processing industry can work as link between Farmers, Government and unemployed youth for better contribution towards economy. The Government of India through the Ministry of Food Processing Industries (MoFPI) is making all efforts to encourage investments in the business. It has approved proposals for joint ventures (JV), foreign collaborations, industrial licenses, and 100 per cent export-oriented units.

The main objective of this Scheme is creation of processing and preservation capacities and modernisation/ expansion of existing food processing units with a view to increasing the level of processing, value addition leading to reduction of wastage. The processing activities undertaken by the individual units covers a wide range of post-harvest processes resulting in value addition and/or enhancing shelf life with specialized facilities required for preservation of perishables.

The food sector has emerged as a high-growth and high-profit sector due to its immense potential for value addition, particularly within the food processing industry as it is said to have Compound Annual Growth Rate(CAGR) of approximately 8 percent over the last five years. The projects approved are running across quadrilaterals of the country covering over 100 agro-climatic zones. The Processed food market is expected to grow to US$ 543 billion by 2020 from US$ 322 billion in 2016, at a CAGR of 14.6 per cent.

MoFPI is implementing PMKSY and the period of implementation is 2016-20 with a total outlay of Rs 6,000 crore (US$ 858.49 million). The PMKSY has seven component schemes viz: Mega Food Parks, Integrated Cold Chain and Value Addition Infrastructure, Infrastructure for Agro-Processing Clusters, Creation of Backward and Forward Linkages, Creation/Expansion of Food Processing and Preservation Capacities, Food Safety and Quality Assurance Infrastructure, and Human Resources and Institutions.

Meetings of the Inter-Ministerial Approval Committee (IMAC) to sanction above projects were held on 21.02.2020 and 26.02.2020.

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

10.2. 10 projects worth Rs 301.54 crore sanctioned for food processing sector in IMA meeting

IBEF, Mar. 06, 2020

10 projects worth Rs 301.54 crore (US$ 43.14 million) with total grant-in-aid of Rs 67.29 crore (US$ 9.63) were sanctioned in a meeting of the Inter-Ministerial Approval Committee (IMAC) held under the Chairpersonship of Union Food Processing Industries Minister Smt Harsimrat Kaur Badal in New Delhi. The projects were sanctioned under the ‘Agro Processing Cluster Scheme’ of Kisan Sampada Yojana of MoFPI. These projects are likely to generate employment for ten thousand people and benefit nearly forty thousand farmers.

Union FPI Minister said that in the last 15 days, MoFPI has facilitated investments worth Rs 707 crore (US$ 101.16 million). The Government through the Ministry of Food Processing Industries (MoFPI) is making all efforts to encourage investments in the business. 100 percent FDI is permitted under the automatic route in Food Processing Industries and 100 percent FDI is allowed through approval route for trading including e-commerce in respect of food products manufacture and/or produced in India. 100 percent Income Tax exemption from profit derived from activities such as post-harvest value addition to agriculture by FPO’s having annual turnover up to Rs 100 crore (US$ 14.31 million).

IMAC approved 8 projects spread over eight districts of Tamil Nadu under the cluster scheme worth Rs 230 crore (US$ 32.91 million) in the meeting held on 4th March 2020. These projects envisage the creation of direct and indirect employment for persons along with employment opportunities in rural areas to be the focus area. These projects are likely to generate employment for around 8000 people and benefit 32000 farmers in that region.

The Ministry expressed satisfaction over proactive approach of Tamil Nadu Government in Food Processing sector as the state has its own dedicated Food Processing policy, policy on FPO’s, contract farming etc, to encourage setting up of food processing industries by agro-entrepreneurs, availing financial assistance from Union government.

The scheme aims at development of modern infrastructure and common facilities to encourage group of entrepreneurs to set up food processing units based on cluster approach by linking groups of producers/ farmers to the processors and markets through well-equipped supply chain with modern infrastructure. The units are set up simultaneously along with creation of common infrastructure.

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

- INDUSTRY and MANUFACTURE

11. 80,000 Micro Enterprises to be Assisted in Current Financial year under PMEGP

IBEF, Feb. 28, 2020

In a meeting held yesterday chaired by Shri Nitin Gadkari, Minister of MSME, and Smt Nirmala Sitharaman, Finance Minister with senior management of all Banks, some of the key schemes of Ministry of MSME which generate large number of jobs with low capital investment were reviewed. The focus of the meeting was on the Prime Minister’s Employment Generation Programme (PMEGP), a flagship scheme of the Ministry of MSME, and Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE). In addition, the issue of restructuring of stressed loans to MSMEs was also discussed to find a way forward to support MSMEs.

PMEGP is a credit linked subsidy scheme which promotes self-employment through setting up of micro enterprises, where subsidy up to 35 percent is provided by the Government through Ministry of MSME for loans up to Rs 25 lakh (US$ 35,770.4) in manufacturing and Rs 10 lakh (US$ 14308.1) in service sector.

Both the Union Ministers commended the work done by the Banks in supporting setting up large number of enterprises under PMEGP over the past years, which has particularly seen a two-fold increase in last Financial Year when more than 73,000 micro enterprises were assisted.

To give further boost to the scheme, the target in the current year has been increased to support the establishments of 80,000 units. In the current year, more than 46,000 units have already been provided with loans by the various Banks and additionally 22,000 loan applications have also been sanctioned and are awaiting disbursement. Banks were requested to release the loans in such approved cases immediately. Besides, the Banks were requested to take up about 1.18 lakh pending loan applications latest by 15th March, with special emphasis on North Eastern Region (NER). CMDs of the Banks, while supporting the scheme, confirmed that they will clear all pending cases by 15th March.

Data analysis of applications rejected by Banks revealed that 11 per cent of the proposals are rejected because the targets given to local banks under PMEGP are met. To address this issue, Banks were requested to increase lending under the scheme and revise their policy of fixing minimum targets so that all eligible applications can be considered for sanction. Similarly, it was found that 11 per cent of the applications are also rejected since the applications received by the banks were outside their service jurisdiction. Accordingly, Banks were also asked to devise a mechanism whereby such application can be automatically transferred to other appropriate branches in the area. A simple procedural change will now ensure that these applications will get considered on merit instead of being rejected summarily. The endeavour of the government is to grant a fair opportunity to every aspiring entrepreneur.

Discussions were also held with Banks on increasing the reach of Credit Guarantee scheme. Government has set a target of increasing credit guarantee to Rs 50,000 crore (US$ 7.15 billion) under this scheme, which is a jump of about 67 per cent over the last year. The Banks brought out that there is a huge demand under this scheme, and they are confident of achieving this target.

One of the major challenges faced by MSMEs is in restructuring stressed loans due to sector related problems or issues with the large industries to which they supply. Finance Minister and Minister of MSME emphasised upon the need for providing support to the MSMEs by suitably restructuring the stressed loans at an early stage. All CMDs agreed to support MSMEs in restructuring their stressed loans. Further they confirmed that in accordance with the Budget announcement, the cut-off date for restructuring of loans to MSMEs has been already extended up to 31st December 2020.

The meeting concluded with the optimism that these initiatives taken for the MSME sector will go a long way in providing support to the sector, thereby increasing employment opportunities. The meeting with Bankers clearly indicates the resolve and efforts of the Government in supporting the MSME sector which is the backbone of the economy.

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

12. The great Indian grocery gig in the sky

Livemint, 27 Feb. 2020, Bidya Sapam, Suneera Tandon

As startups and global giants gear up to change how Indians buy grocery, the kirana store is finally in the picture

Mumbai/New Delhi: For roughly a year, Dilip Kumar’s small ready-made garments shop near the Gurugram railway station has adopted one of the oldest tricks known to big business houses: diversification. The shop doubles up as a tiny warehouse to store groceries from online supermarket Grofers. While his father manages the storefront, 27-year-old Kumar is out knocking on doors in his new avatar as a Grofers service partner.

Kumar’s day begins as early as 6am. And he earns anywhere between ₹35-40 per delivery. Kumar is able to earn an additional income of around ₹22,000-25,000 each month. “I learnt about this opportunity from a friend. The only requirement was that we should have a shop," he added.

Kumar’s store is one of 5,000 such Grofers partners that have sprung up across 27 cities. Global e-commerce giant Amazon claims more than 18,000 stores have signed up for its “I have space" programme in India. And Reliance Retail Ltd plans to open thousands of outlets called Reliance Smart Points, essentially a network of grocery stores that will be used for last-mile delivery of food and grocery.

The small storefronts which double up as mini warehouses are touchpoints in a battle that is brewing to change how Indians buy grocery. The big bet: once you buy an everyday items through a certain channel, you can be eventually coaxed into buying everything through that channel.

While online startups like Bigbasket and Grofers are at the vanguard of the digital-led grocery push that is under way, the entrenched e-commerce giants and traditional storefront retailers aren’t far behind. In fact, the country’s leading retail firm Future Group and Amazon India announced a partnership just last month in an effort to find synergies and leverage each other’s networks.

Even retailer lobby group Confederation of All India Traders (CAIT) doesn’t want to be left behind. It has been agitating against the business practices of e-commerce giants and wants to launch an online marketplace to sell all kinds of items, including “daily goods". Sumit Agarwal, national secretary of CAIT, said: “We are currently firming up a plan."

The prize that everyone is after is a slice of the fast-expanding online grocery space. While grocery constitutes an estimated 60% of the country’s total retail market, the real motivation is its “stickiness". Grocery is bought frequently and with a high repeat rate. And the e-tailer who wins hearts and wallets in that space can easily sell other items.

“Grocery by itself is 70% of the wallet share for a household and it is around 97% unorganized. So, the volume of customers that we can bring into our (online) stores is massive," said Gaurav Jain, head (business and strategy development) at Reliance Retail. “What is also big is that the access of choice to such customers is very limited at the moment. When they come to our (online) stores, we can sell thousands of items and we are able to just point to many more options to buy."

But every online marketplace needs its last-mile delivery man— who matters a lot more in the grocery space unlike e-commerce, due to additional concerns such as “freshness". Naturally, a parallel race is on for the small retailer, the grocer and the local garment store. Ironically, the humble kirana store is back in play, in a new concerted effort to change the face of retail in India.

Suddenly, even for the multinational giants, small is beautiful. And men like Kumar have gotten increasingly entangled in a new wave of structural change that is sweeping through India’s growing food and grocery retail market, estimated to be worth $500 billion.

As per market research firm RedSeer Consulting, online food and grocery retail currently accounts for just 0.2% of the overall retail market. However, it is expected to touch $10.5 billion, or contribute 1.2% to the overall market by 2023.

Beyond those figures, however, big bets are also being placed due to past precedent. Between 2018 and 2020, India’s online food delivery map (led by Swiggy and Zomato) expanded from roughly 30 cities and towns to more than 500. Currently, online grocery has a similar small footprint, with presence in 25-30 cities. The question is: how fast will this change? And what will be the ripple effects on consumer choice as well as on how retail is organized in India?

The disruptors

Some of those ripple effects due to digitization are already showing up all along the supply chain. For example, it’s been over two years since Mungilal (42), who runs a grocery store in Bengaluru’s HSR Layout, visited a wholesale market in the city.

In 2018, a sales executive at ShopX, a business-to-business (B2B) platform that helps small retailers place orders for goods online, convinced Mungilal to sign up on the app. “He said I could buy all the items here; he showed me the app and told me I could get it at a better price. They also promised one-day delivery if ordered on time," said Mungilal.

The result: no more weekly trips to the wholesale market, which is 15 kilometres away. “I save about ₹200 on travel," he added. In terms of the price of goods, the savings are only incremental—for every ₹1,000 spent at the wholesale market, Mungilal said the savings totalled ₹80, while with ShopX, they are ₹85.

But as big money flows into the grocery pipeline, it is the traditional model of distribution and sales that may get upended first, much before any changes become visible to the consumer.

“Grocery is a low-margin business. To be profitable in grocery, one needs to have very strong logistics and also supply chain," said Vishnu Vardhan, senior research analyst at market research firm Euromonitor International. And digital will be a key part of the disruption, he said. “While offline is highly penetrated, there is a huge opportunity to tap into online. At present, most people want to have a first-mover advantage in the online market."

The current wave of digitization has only given a new fillip to old dreams. There have been enough murmurs of radical change in retail ever since the early-2000s, which saw the launch of Western-style hyper and supermarkets in India (Future Group opened its first Big Bazaar in 2001).

With foreign direct investment in multi-brand retail (which would have allowed giants like Walmart to open physical stores) becoming a political hot potato in the early part of this decade, hopes were already beginning to be pinned on the online route. But given India’s inherent weaknesses in cold storage and logistics, grocery was a particularly difficult nut to crack. Future Group’s e-commerce venture Big Bazaar Direct, for example, had to be shuttered in 2016, three years after launch due to soaring costs.

What is different this time, perhaps, is that multiple entities with deep pockets are in the fray, at a time when internet access has rapidly expanded. The “focus on the kirana store" pivot is another key change from past attempts.

Last year, India’s richest man Mukesh Ambani made a quiet entry into the country’s grocery market with the soft launch of its new venture named JioMart. Apart from the Amazon-Future Group partnership, there is also the Walmart-backed Farmer Mart.

Walmart’s focus on grocery retailing in India has firmed up after it acquired Flipkart, said a person familiar with the retailer’s plans. “In line with the country’s FDI policy, we’re in the process of applying for the appropriate licence. We’ve secured all internal approvals already," said a Flipkart spokesperson.

Case for unique models

Amit Sharma, co-founder, and CEO of ShopX, said he is firmly of the belief that the dominant model which will emerge in India will be small-format modern trade. “India finds itself at a unique time and history. This means our retail trajectory is bound to be different from (the) Western trajectory," he said.

“What will work in India is a local model built for India," said Ankur Bisen, senior vice president (retail) at consulting firm Technopak Advisors.

According to experts, retailers currently earn a margin of around 8-23% on selling perishables and 8-10% on other grocery items. Any new way of doing business would need to find a way to match or better those terms, without passing on additional costs to households.

“You cannot bleed on delivery. That is why online players need partnerships with the physical retail stores or a good procurement system," said Vardhan of Euromonitor.

Huge challenges

But despite the air of anticipation about an impending transformation, expansion beyond the top 30 cities will come with a long list of risks and challenges. Grocery has particularly unique pain points, like perishability and delivery-time pressures.

That is why, for at least a while, the big focus will remain on metros. “We focus on what we call motorcycle families...those families which own a motorcycle but don’t have a car," said Albinder Dhindsa, co-founder of Grofers. “We are there in tier III-IV cities as well, but choosing which city we go to is more a function of how we are expanding the supplier, distributor and merchant base."

But despite these obvious challenges, Vipul Parekh, co-founder of Bigbasket, says companies will inevitably play the long-term game, given the growing number of online customers. “Online grocery is growing six times faster than the physical market," he said. Bigbasket claims to have about two million customers across 26 cities currently.

As a result, the online grocery segment has even begun talking about profitability. Dhindsa claims 70% of Grofers’ locations are profitable and he expects to break-even at the overall company-level by the end of the year.

But questions will remain about whether the business can become sustainable or compete with the well-entrenched kirana/wholesale distributor ecosystem.

Ultimately, it comes down to whether India is ready to replace its relationship with a local kirana in favour of an invisible face, said Arindham Banerjee, a professor of marketing at the Indian Institute of Management Ahmedabad.

While a little bit of competition from new entrants is always good, unless quality is standardized, there is going to be a lot of angst, particularly with fresh produce, he said. “India is nothing but a strong network of people, whereas, America is all about standardised processes. You’re trying to import an American model into India. It may work, but the evolution is going to be slow," added Banerjee.

Kalpana Pathak in Mumbai contributed to this story.

13. Hero MotoCorp to invest Rs 10,000 crore over next 5 to 7 years

IBEF, Feb. 19, 2020

Hero MotoCorp, the country’s largest two-wheeler manufacturer, plans to invest Rs 10,000 crore (US$ 1.43 billion) over the next five to seven years on research and development (R&D), new product development and expansion of facilities.

The company Announced its ‘Vision 2020 — the Future of Mobility’ and aims to be carbon neutral by 2030.

“Over the next five to seven years, we would be investing around Rs 10,000 crore (US$ 1.43 billion) in R&D of alternative mobility solutions, modern, state-of-the-art, sustainable manufacturing facilities, network expansion, and brand-building across the globe,” said Mr Pawan Munjal, Chairman and Managing Director, Hero MotoCorp.

The company expects to cross 100 million vehicles in cumulative sales in late year since the company started its journey, way back in 1985, he added. “Since April 2011 (after its separation from Honda), when we commenced our solo journey, we have invested a total of over US$ 600 million in our R&D. Similarly, we have invested over US$ 1 billion in setting up new manufacturing facilities and plants,” he said.

Mr Munjal said the company’s target is to become carbon neutral by 2030, waste neutral by 2025 and 500 per cent water positive the same year under its sustainability targets.

He added, “Changing times call for a change in structure. So, to address the new, emerging trends, we have created a separate vertical — the Emerging Mobility Business Unit — that is working on a range of mobility solutions for the future”.

“We will redefine mobility through the creation of a robust roadmap that sets best practices and benchmarks for the industry. We have been driving innovation and technology advancements in the field of mobility for decades. Yet, it is imperative that we continue to shift gears and constantly keep innovating and inventing in every sphere of mobility.”

Hero MotoCorp launched BS-VI-compliant versions of its Glamour motorcycle model, priced at Rs 68,900 (US$ 985.83) and Rs 72,000 (US$ 1030.19), and Passion Pro, priced at Rs 64,990 (US$ 929.88) and Rs 67,190 (US$ 961.36). The company also unveiled its premium bike Xtreme 160R, which will be available in the markets in March.

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

14.1. Haier launches 83 products, some AI- and IoT-powered

IBEF, Feb. 24, 2020

Home appliances and consumer electronics brand Haier has launched 83 products in different categories, including some powered by Artificial Intelligence and Internet of Thing solutions.

“The home appliances industry has entered the era of IoT and new technologies with customers looking for products that provide a connected and a holistic new age experience,” said Mr Eric Braganza, President of Haier Appliances India.

These new range consist of refrigerators, air-conditioners, washing machines and LED TVs.

The company expects to witness a high growth in momentum in different categories with the expansion of its product portfolio to smart home solutions. The company has a network of around 20,000 dealers and 539 service centres covering 19,000 pin codes across the country.

The company introduced its AI-enabled Smart TVs and smart refrigerators and Wi-Fi-enabled washing machines along with other products.

Targeting the upcoming summer season, Haier has lined up 29 new air conditioners to cater to diverse needs of its customers.

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

14.2. Toray Ind unit in Sri City to make technical textile, auto parts

IBEF, Feb. 17, 2020

Toray Industries (India), a subsidiary of Toray Industries Inc of Japan, commissioned its Rs 1,000 crore (US$ 143.08 million) plant in Sri City in Andhra Pradesh to produce meditech technical textile materials and auto components.

Mr Mekapati Goutham Reddy, AP Industries Minister, unveiled the plaque marking the inauguration of the plant in the presence of Mr Kojiro Uchiyama, Consul-General of Japan in Chennai.

This is the 20th Japanese company to start operations at Sri City while five more Japanese companies are in their construction phase.

The unit, which was built on an 85-acre site at an initial investment of around Rs 1,000 crore (US$ 143.08 million), has units for manufacture of Polypropylene (PP) Spun Bond and Engineering Plastics Resin Compounds, an Environment Treatment Plant, power utilities, along with related infrastructure.

The PP Spun Bond plant is expected to start the commercial production of meditech technical textile material in March 2020. These products are used in diapers and sanitary napkins, which take advantage of the material’s combination of wicking, softness, high uniformity and light weight.

The products made at the Engineered Plastics Resins plant are expected to be used as raw materials for making automobile electrical components and electrical and electronic connectors. The plants will provide their products to both Indian and supply to exports.

Around 400 people are expected to get employed by these both plants cumulatively and is expected to increase in subsequent phases.

The Minister said because of ease of doing business in the State, several Japanese companies prefer AP, particularly Sri City.

He added, “For expediting speedy process and clearance, soon we will introduce a special desk for Japanese investors.”

Mr Kojiro Uchiyama said that “Toray’s presence will make a significant impact on Indian market with its innovative products.”

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

15. Why Surat’s star has stopped shining

Livemint, 27 Feb. 2020, Nidheesh M.K.

India’s diamond city is facing a slowdown of epic proportions that threatens to change its face

Surat: Late in the night of 20 February in Gujarat’s Surat—a five-hour drive from the Motera Stadium where, four days later, US President Donald Trump underscored India’s status as an economic giant in front of Prime Minister Narendra Modi— labour activist Jaysukh Gajera got a call from a diamond worker’s family.

Gajera is a frail person who heads Ratnkalakar Vikas Sangh, a federation of diamond labourers. Workers and their families often call him. And when they do, it was almost always to deliver bad news. He sped towards the house of Kanubhai.

Earlier in the evening, Kanubhai (bhai, meaning brother, is a common way of addressing people in the region) had returned from the diamond factory where he works, had a meal at home, went out for a stroll and consumed poison. As his end neared, he seemed to have had second thoughts. He called his home asking to be rescued. By the time the family could find him, he was dead. Kanubhai’s family told Gajera that he was upset about his income going south.

Gajera carries a self-made form to document such deaths— there have been many, you see. “They said he was depressed about his salary being reduced. There is no other breadwinner in that family. I noted down their details in the form and spoke to his factory owner to get some help," said Gajera, waiving the form documenting Kanubhai’s final journey in his office where hundreds of such forms are piled up. Last year, 10 workers killed themselves, he added.

But unknown to Gajera, on the same day, in another corner of the city, Surajbhai, a street trader in diamonds, committed suicide. Even Vijay, a distant relative who used to sit next to Suraj in Mahidharpura street, known for diamond trading, came to know the news only the next day. “His business was bad," said Vijay, declining to delve into much detail, except for adding, “Everybody is going through a tough time."

Surat is far removed from the globetrotting world of diamond traders like Nirav Modi and Mehul Choksi—who are now fugitives after being accused in a $2 billion financing fraud. For more than 50 years, life in this city has revolved around diamonds. And in a sustained slowdown, the business is in the rough. According to a report in The Times of India (TOI) in September 2019, some 40,000 workers were laid off in the preceding year, and 20% of small diamond units were shut and salaries were trimmed across the sector.

Running out of luck

They say Surat was a prosperous port city even a century ago—when Mumbai was just a fishing village. People in the city take immense pride in this heritage. The story goes that river Tapi, the banks on which the city is built, is a sister of Lord Shani, the master troublemaker in Indian mythology. Shani would go around the world making mischief, but wouldn’t touch his sister’s blessed city.

Now, this godly luck may be running out for Surat. The city is the biggest processing hub for diamonds in the world. According to estimates, nine out of 10 diamonds sold anywhere in the world would have passed the hands of a worker in Surat. Of the 4.5 million residents in the city—it is among the world’s fastest-growing 30 cities as per recent United Nations data—more than 800,000 people work in the diamond industry, as cutters or diamantaires, workers , wholesalers, traders, brokers, retailers, jewellery fabricators, according to The Diamond Trail by Shantanu Guha Ray.

But today, suicides and job losses reflect many trends of a slowdown— declining global sales; international trade wars which make imported diamonds from the US more expensive and less attractive in the biggest diamond market of Hong Kong; the impact of demonetization and the goods and services tax (GST); and more recently, the coronavirus outbreak.

As per official data, imports of rough diamonds fell by 6.29% to $20.3 billion between April 2019 and January 2020. Consequently, exports of polished diamonds declined by 1.45% to $25.11 billion in the same period.

Unequal glory

For all its glory, Surat’s capital distribution is skewed. Some 500 companies do ₹100 crore or more worth of business annually, and have a full-fledged network to import and export gems. The rest—some 2,500 small and midsize diamond traders, 60,000 brokers and thousands of polishing workers—position themselves along the food chain to eke out a small margin in the journey of rough diamonds to polished stones as they travel through Surat.

Hundreds of people working in the small and midsize units, who could be seen sitting cross-legged on pavements as well as in office buildings in markets such as Mahidharpura, are arguably the most hit by the current slowdown. The traders frequent such street markets to sell rough diamonds. The brokers check these diamonds with their loupes (magnifying glass) and decide whether to buy them, based on a small commission.

The gems are then passed onto the workers, who work on the stones. Finally, the cut and polished diamonds are sent back to Mumbai, India’s only diamond trading hub.

Change is in the air. Suresh Patel, for instance, sold diamonds on the street for more than 20 years, but last year switched to selling tea to offices to make ends meet. “You and I would not have been able to leisurely stand in this street and talk like this before, there would be thousands between us, all focused on selling diamonds," he said, when we met at Mahidharpura. Anil Patel, another trader in the street, with more than 17 years of experience, agreed. “Business is down by 70%. I bought 10 packets of diamonds before, now only three," he said.

For sure, the diamond industry has seen several such shocks. The biggest in recent memory was the 2008 financial crisis when hundreds were rendered jobless. The current turmoil, to them, is almost a trip back to those days.

“We estimate that some 2,000 skilled workers have gone to countries like Russia, Dubai and even South Africa in search of jobs. Every year, 2,000-4,000 workers are reduced in the industry," said Gajera of Ratnkalakar Vikas Sangh. The suicides, he added, are often the frantic final step taken by such despondent people.

Coronavirus impact

Dinesh Navadiya is president of the Surat Diamond Association and regional chairman of Gem and Jewellery Export Promotion Council. He says the current crisis started with the US-China trade war. “There has been a sustained 15-17% drop in demand. As dollar valuations went up, the Chinese started purchasing lesser gems to cut down their cost. So the circulation has been coming down slowly," said Navadiya.

The coronavirus outbreak has taken this to the next level. “This is almost fully an export-oriented market. Some 37% of exports go straight to Hong Kong, which was affected by a popular uprising for some time and is now completely shut because of the coronavirus," he said.

To this mix, add the negative impact from demonetization and GST. “All small-to-midsize businesses were working with cash, which got blocked during demonetization. With GST, the problem is in the 5% tax on job work. Those who don’t have factories and operate on their own on razor-thin margins, this has been the final straw," said Navadiya. Realizing the extent of the problem, the government has reduced GST to 1.25%. But an estimated ₹1,500-2,000 crore—crucial working capital for the industry—has already got sucked into the tax net.

But with the coronavirus outbreak, even the big guys in the businesses are worried. If it prolongs, even the banks in Surat will have a serious crisis at their hands. This is because banks extend credit for most exports from Surat, said a bank manager, requesting anonymity. “Banks will give me the money at a discounted bill so that one can purchase the raw materials to import again," he explained.

Rough diamond importers have upfront payments, running into millions of dollars. Banks charge an interest rate of 4-5% for this dollar-to-dollar payment, but on the condition that it will have to be returned within 90 days, said the manager. If not, the interest rates will go up and the credibility will go down.

“With the coronavirus, the whole payment circulation has come to a standstill and the banks are worried. Already, because of two people’s mistakes, banks have severely trimmed financing diamond units," added the banker, referring to Nirav Modi and Choksi.

Diamonds and rust

Diamond companies, along with textile firms, have given Surat most of its riches. There are shopping malls, well-paved roads and bridges, freshly-constructed apartment complexes, and a giant diamond bourse in the works. In the local yore, it is common to see someone pulling over his Ferrari near a roadside vendor to savour pav bhaji.

So when the business is dull, the contrast is hard to miss. And nowhere is that perhaps starker than at one of its most celebrated firms, Hari Krishna Exports Pvt. Ltd, which has a ₹6,000 crore turnover and employs 8,000 workers. Spread across 17 acres, the campus of Hari Krishna has three tall towers and an artificial lake. Loudspeakers in all corners play devotional hymns. But the most unique sight would be at the parking lot: the long line of cars that employees got as Diwali bonus.

Run by diamond baron Savji Dholakia, the firm made headlines several times by gifting workers bonuses in the form of cars such as Mercedes-Benz or Renault Kwids and costly flats. In 2018, Dholakia gave them to as many as 600 employees. In 2019 though, when asked by TOI whether the company would give Diwali bonus, he flatly ruled it out. “This recession is worse than the one we experienced in 2008. When the entire industry is in doldrums, how can we afford to offer gifts? We are more concerned about protecting the livelihood of diamond workers," said Dholakia.

Pintu Dholakia, CEO of Hari Krishna, said: “Since the last 11 years when I have come into this business, the industry has not grown in terms of dollar value or rupee value. If it was one lakh crore rupee business 11 years ago, today also it is that much. So if this is going to be the case going forward, you don’t expect more people joining in this industry because there’s no scope of growth."

“Only three major businesses are there in Surat—diamonds, textiles and real estate. That all has matured. In the coming years, there will be some other businesses that will have to come and give us growth as a city," he added.

At Hari Krishna, the change is visible. “We feel that diamond trade will have other substitute industries as well, like jewellery that will expand in India in a different way," he added.

In conclusion

Chirag Virani is already at it. An engineering and MBA graduate from Canada who heads his family’s midsize diamond firm Virani Gems in Surat, he is working on a start-up that makes organic sanitary pads. “We might have to be ready for 10-25% slowdown in business," said Virani, adding that he plans to keep his inventory low and cut shifts to mitigate through the crisis.

“We have a different mentality," said Virani when asked about whether he worries about the future. “My dad’s uncle, my grandfather’s brother, came here as a polisher. They lived a very hard life. And to them, instead of farming in the hot sun, sitting in an office and cutting and polishing was always easy. And then slowly, with hard work and a little bit of luck, we are here now."

“We came here with nothing and we will find a way. Everything is a bonus in a way," added Virani.

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

16. Novartis launches Biome India, its first Asian digital innovation hub, in Hyderabad

IBEF, Feb. 20, 2020

Global Pharma major Novartis launched Biome India, which is a digital innovation hub, located in Hyderabad. This is the company’s first such centre in Asia and the fourth globally, where others are located in San Francisco, Paris and London.

The company has a huge presence in Hyderabad with its drug development and research facilities. Overall, India is a big hub for the company with around 8,000 employees, manufacturing facilities and business services.

The Biome India is expected to engage with start-ups and innovators who are passionate about the healthcare sector. This will help the external ecosystem, allowing the Novartis teams to better discover, develop and drive collaborations that will transform innovative initiatives into impactful and scalable solutions for patients.

The announcement was made by Mr Vasant (Vas) Narasimhan, the global CEO of Novartis, who received the Genome Valley Excellence Award at the ongoing BioAsia 2020 summit.

The latest Biome is linked to the four centres and Novartis global, which will enable it to tap into the assets and expertise of the broader Novartis portfolio to make a greater impact. Access to anonymised data, customised residency programmes and personalised mentoring will be available to the Biome.

“Together, we have a fantastic opportunity to combine our scientific know-how with the expertise of tech players, big and small, to create digital solutions for patients, at scale,” said Mr Bertrand Bodson, Chief Digital Officer, Novartis.

“We want to leverage this ecosystem to work with start-ups and innovators to disrupt healthcare in the country and perhaps the world,” said Mr Naveen Gullapalli, Head, Novartis Hyderabad.

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

17. Oyo's loss rises sevenfold but says no brakes on expansion

Livemint, 17 Feb. 2020, Salman SH

The hospitality firm reported widening of its consolidated net loss to $335 mn for the financial year ended March 2019, mainly on account of international expansion
Oyo’s loss in its oldest market India narrowed to 14% of revenue in the last fiscal from 24% in the year-ago period

Bengaluru: SoftBank Group-backed Oyo Hotels and Homes will continue its expansion into international markets such as Latin America, China and the UK, senior company executives said, even as its losses surged sevenfold last fiscal.

The hospitality startup will also focus on turning profitable in its home market India, where its margins improved 4.1% in 2018-19, Oyo board member Aditya Ghosh said in a conference call with reporters to discuss the audited financial results for FY19.

Ghosh did not say when Oyo could start making profits.

Oyo’s consolidated loss ballooned to around $335 million in 2018-19 from $44 million in FY18. The company, one of the world’s largest hotel chains, currently has 18,000 hotel partners and an inventory of 270,000 rooms across India.

The Bengaluru-based start-up attributed the increase in losses to inherent cost of establishing new markets, including those related to talent, entry into new markets and operational expenses.

Consolidated revenue jumped to $951 million in FY19 from $211 million in the previous year. It included $604 million in revenue from India operations.

Around $348 million was contributed by overseas operations, primarily China.

Oyo operates on a franchise model where it takes over a hotel asset, renovates the space and sells individual rooms under the Oyo branding. It claims to have hosted more than 180 million users between January and December 2019.

The startup said it has around 43,000 hotel partners and a million rooms on its inventory, including 99,000 rooms across 300 cities in South Asia, 17,000 rooms in West Asia, 12,000 in Japan and 16,000 in Latin America.

Oyo said China and other international markets, which were in “development and investment mode", accounted for 75% ($252 million) of losses during the year.

Net loss as a percentage of revenue grew to 35% in FY19 from 25% a year ago.

However, in its oldest market India, the startup narrowed its losses to 14% of revenue in FY19 from 24% a year ago.

In addition, the startup said gross margin in India improved to 14.7% in FY19 from 10.6% a year ago, although it did not detail the margin figures for international operations.

The announcement of the audited financial performance comes at a time when Oyo has been laying off employees across India and other geographies to keep costs in check.

The retrenchment process, which Oyo describes as a “right sizing" and restructuring exercise, has happened over the last couple of months.

Addressing recent media reports of corporate clients opting out of Oyo, Rohit Kapoor, chief executive of Oyo India and South Asia, said only two-three corporate clients have left so far.

“Our corporate business grew around 80% in FY19… we currently have around 7,500 clients on the corporate base. In 2019 itself, we added 4,000 new clients to our corporate base," said Kapoor.

During 2019, Oyo claimed to have generated over 90% of its revenue from repeat customers and organic users, with repeat customers contributing to 73% of total revenue.

“We have crossed an important milestone of achieving global revenue of $951 million in FY2019, a 4.5 times increase on a year-on-year basis," said Abhishek Gupta, Oyo’s global chief financial officer. “As we work towards consistently improving our financial performance, ensuring strong yet sustainable growth, high operational and service excellence and a clear path to profitability will be our key to our approach in 2020 and beyond."

18. Why hotels are free to charge more than the MRP

Livemint, 25 Feb 2020, Nilanjana Chakraborty

You might even be tempted to pay a bit extra, but keep in mind that charging anything over the MRP is illegal
While the MRP can’t be exceeded, retailers can choose to sell for less than that amount

Whether you’re loading your basket with the essentials at the local convenience store, or buying a packet of chips from the shop next door, it’s almost instinctive to flip the package and see the price stamped on the back or bottom. But what are you looking at?

A maximum retail price or MRP is the price calculated by a manufacturer and set as the highest price at which a product can be sold. This factors in the cost of production, transportation, applicable taxes as well as the profit margin of wholesalers and retailers. It’s mandatory for all packaged products to have an MRP. But while the MRP can’t be exceeded, retailers can choose to sell for less than that amount, in other words, at a discounted price.

But the trouble arises when someone tries to charge you more than the MRP. You might have come across a shopkeeper or grocer who tries to charge you a little extra for reasons like having to refrigerate a bottle of cold drink on a hot day or to pay extra for transportation to hard-to-access areas.

You might even be tempted to pay a bit extra, but keep in mind that charging anything over the MRP is illegal. Costs like transportation and refrigeration are already factored into the MRP, and under the provisions of the Central Law of Metrology Act, a retailer violating the law is liable to pay a fine of ₹2,000.

But there is one exemption to the enforcement of the MRP rules. In 2017, a Supreme Court bench ruled that hotels and restaurants can sell bottled water and packaged food at higher than the MRP. The reason cited for this was that the restaurant or hotel in question would not be making a simple sale, as a retailer would, but would also be providing the customer with additional services like ambience and cutlery. The bench decided that the provisions of the law won’t apply to hotels and restaurants, and these establishments can’t be prosecuted for selling items above the MRP. This was following an affidavit filed by the government in 2015, stating that overcharging for pre-packaged products was a legal offence, as well as that legalizing this practice could help establishments like hotels evade taxes.

So, in view of the apex court’s judgment, you are obliged to pay the extra cost a restaurant charges for a bottle of packaged mineral water over and above the MRP for merely providing you a glass and pouring out the water.

19. Exports from SEZs achieve US$ 100 billion mark; Services sector shows 23.69% growth in Rupee terms

IBEF, Feb. 19, 2020

The Special Economic Zones (SEZs) continue to take the lead in expanding the exports for the country. Even in the midst of volatile global economy, SEZs in India have shown resilience and have achieved US$ 100 billion worth of exports in FY 2019-20, as on 17thFebruary 2020. It may be mentioned that SEZs achieved this landmark of US$ 100 billion worth of exports in 2018-19 in full financial year. A comparison of FY 2019-20 vs. 2018-19 up to February 17th is given below:

It is observed that while the services segment, constituting majorly of IT & ITeS services was driver of the export growth at 23.69 per cent. There was almost 4 per cent growth in manufacturing segment also. This reflects overall expansion and interest in SEZs in the country. Number of operational SEZs have grown to 241 as against 235 at the end of FY 2018-19.

Important sectors that saw healthy growth in this financial year include Gems & Jewelry (13.3 per cent), Trading & Logistics (35 per cent), Leather & Footwear (15 per cent), Non-Conventional Energy (47 per cent), Textiles & Garments (17.6 per cent). Petrochemicals constitute a major segment of SEZ exports; however, growth was muted in this segment, which may be attributed to softening of global crude prices.

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

20. Making ordinary cars smart, one connected device at a time

Livemint, 13 Feb. 2020, Abhijit Ahaskar

Until you have the budget for a smart car, IoT devices can serve as an efficient substitute
Though the segment is small, it is expected to grow after Jio's foray into connected car space

Connected cars are the new drivers for the automotive industry. But for users who still don’t want to give up on their existing cars, and still want a bite of the new technology, there is an emerging ecosystem of connected devices that can turn an ordinary car into a connected car.

These devices come with eSIM for internet connectivity, and IoT sensors to capture information on the health of the car, fuel requirements and rely on cameras to keep track of the driver’s distraction level by analysing their body posture and face. In case of break-in attempts, they can alert the owners via their phone.

IoT devices like these are already in use. A case in point is Zoomcar’s Cadabra—a 4G and Bluetooth-enabled IoT device that can track the distance travelled, fuel used, clutch performance, allowing car owners or drivers to keep tab on metrics like clutch position, harsh braking, inconsistent acceleration, seat belt usage and engine health.

“The advantage of a device like this is that it can be customized for each car as is required for the business. We realized that Indian drivers are more aggressive on the road with rental cars and are prone to drive rashly. Cadabra can monitor and generate data every second from the car movement to understand driving pattern," said Arpit Agarwal, director of decision science at Zoomcar. While Zoomcar’s device is used to keep track of drivers who rent out their cars, gadgets like these are also available for individual users.

One such device is Trak N Tell’s connected car solution IntelliPlay, which also takes connected car experience beyond infotainment and navigation by offering telematics platform and can provide real-time GPS location, over-speeding and geo-fencing alerts in addition to tracking driver behaviour. Such information can help car owners detect instances of rash driving, over-speeding and hard braking when someone else is behind the wheels. After an IntelliPlay is installed, the car gets a unique phone number that can be used for two-way calling. It is not tied to any smartphone, allowing anyone to call the car directly and speak to the driver.

Though the segment is small, it is expected to grow especially after the recent foray into the connected car space by telecom firm Reliance Jio, riding on a similar IoT device with a 4G-ready eSIM. Jio’s device, which was unveiled at Auto Expo 2020, can also link up with a connected 360-degree camera, keeping an eye on both the driver and road to track driver distraction by analysing the face. It will also send alerts if the driver is not wearing the seat belt. User can keep track of the route and location through a mobile app. It can be used to send alerts based on pre-defined parameters chosen by the user. Reliance Jio is still to announce the price and launch date for the connected car solution.

Starting at ₹18,999, the IntelliPlay device comes in different screen sizes ranging from 7 to 10 inch. The higher variants include AHD reverse camera and high-contrast screens. MapMyIndia’s plug-n-play connected device called Drive Mate, which can send a car’s location, alerts on driver behaviour and send real-time notifications when car’s ignition is turned on/off and when the device is unplugged is available at starting price of ₹9,990.

“IntelliPlay is an after-market product and can be used to upgrade an older car to a connected car at a fraction of what a connected car costs today. It is compatible with older mass-market cars such as a 2014 Maruti WagonR as well as new ones like 2019 Toyota Fortuner. It also supports most features in today’s connected cars and we are continually enhancing the customer experience with upgrades to the software," said Pranshu Gupta, founder and CEO, Trak N Tell. Gupta has a point. A fully connected car like Hyundai Venue which comes with Hyundai’s proprietary BlueLink technology that offers telematics and internet services starts at ₹6.5 lakh, for instance.

Buyers who are not interested in all the advanced features and are merely looking for something that can make a car smart and ready for voice commands, there is Amazon’s Echo Auto. Priced at ₹4,999, Echo Auto has Alexa in-built which can be used for playing music, making calls, listening to news and updating the to-do list using voice commands.

Connected car is the future. In a few years, all cars will have such technologies. Until you have the budget to get one, these connected devices can come in handy.

India and the World

21. Ties, knots and new highs in the India-US strategic partnership

Livemint, 25 Feb. 2020, Elizabeth Roche

India and the US elevate ties to the level of global strategic partnership, announcing key pacts in some sectors
Modi said India and the US were ‘committed to openness and fair and balanced trade in the economic sector’

New Delhi: India and the US on Tuesday elevated their ties to the level of a “comprehensive global strategic partnership" and announced key pacts in areas ranging from defence to energy.

The two also stepped up cooperation in the area of homeland security, with increased efforts to hold supporters of terrorism accountable, Prime Minister Narendra Modi told reporters after talks with Donald Trump. The US president arrived in New Delhi on Monday evening after making stops in Ahmedabad and Agra. In Ahmedabad, Modi had joined Trump at the “Namaste Trump" event to address more than 100,000 people at the Motera Stadium.

Both leaders emphasized the areas of convergence between the two countries, with Trump steering clear of commenting on India’s Citizenship Amendment Act (CAA). At least 13 people were killed in violence in New Delhi, and critics in the country and abroad slammed the Indian government for a seeming increase in religious intolerance.

“In the event, Trump refused to comment on the CAA or the rioting in New Delhi, which he called India’s internal affair. He said he had raised the issue of religious freedom at length with Modi but controlled the damage by saying that Modi made a ‘powerful’ and reassuring response," former foreign secretary Kanwal Sibal said, summarizing Trump’s comments.

Trump also pledged to fight terrorism jointly with India but refrained from criticizing Pakistan. On the issue of Kashmir, he offered to help resolve the dispute between India and Pakistan.

Trump and Modi spent five hours in discussions on Monday and Tuesday. The talks were “extremely comprehensive", and “extremely cordial", foreign secretary Harsh Vardhan Shringla said. The talks covered security and defence, energy, technology and trade, people-to-people ties and global and regional issues.

At a joint media appearance, Modi described the India-US relationship as the “most important partnership of the 21st century".

“And therefore, today, President Trump and I have taken a decision to raise our partnership to the level of a comprehensive global strategic partnership. President Trump’s contributions in raising our relations to this level have been invaluable," Modi said. “We had a productive exchange on every important aspect of our partnership, whether it is defence and security, our strategic energy partnership, technology cooperation, global connectivity, trade relations or people-to-people ties."

“The increasing defence and security cooperation between India and the US is a very important aspect of our strategic partnership. Cooperation in ultra-modern defence equipment and platforms will enhance India’s defence capabilities," he added.

Trump, on his part, said India has agreed to purchase more than $3 billion of advanced US military equipment, including Apache and MH-60 Romeo helicopters—seen as a key takeaway of the visit.

Both countries agreed to scale up trade in crude oil and liquefied natural gas.

On the contentious issue of trade, Modi said India and the US were “committed to openness and fair and balanced trade in the economic sector. Over the last three years, our bilateral trade has witnessed double-digit growth and it has also become more balanced".

Trump told reporters that he and Modi had spent “a lot of time talking about Pakistan". Trump said he had a very good relationship with Pakistan. There was no question that Kashmir was a “problem" and India and Pakistan were working on it. “India is a brave nation," he said, adding that he had told the Indian side he would do whatever he could “because my relations with both of them (Modi and Pakistan Prime Minister Imran Khan) are so good."

Earlier, Trump said the “US is also working productively with Pakistan to confront terrorists who operate on its soil."

22. HAL eyes base in four nations to push 'made-in-India' defence products

IBEF, Mar. 09, 2020

Hindustan Aeronautics Ltd (HAL), a state-run aerospace major, is eyeing to set up logistics bases in Malaysia, Vietnam, Indonesia and Sri Lanka, as part of initiatives to lure the countries to buy India's light combat aircraft Tejas and military helicopters.

Chairman and Managing Director of HAL Mr R Madhavan said, the HAL is considering to build logistics bases in the four countries as they use a number of Russian-origin military aircraft and choppers whose serviceability is "very poor".

Mr Madhavan said the HAL is focusing on increasing exports in line with the government's priority and has identified South East Asia, West Asia and North Africa to sell key platforms like Tejas, attack helicopter Rudra and advanced light helicopter Dhruv.

Last month, Prime Minister Modi has set an ambitious defence export target of US$ 5 billion in the next five years and has urged to all the key military manufacturers to work towards achieving the target.

"We are looking at setting up maintenance facilities in Malaysia, Vietnam, Indonesia, Sri Lanka. We can give them a lot of support to as these countries use lot of platforms which are common to India, and their serviceability is very poor," he told the sources.

The company is looking to set up maintenance facilities in these four countries because having logistics bases is key to sell the products and ensure after-sales services, the HAL top executive said.

Without divulging details, Mr Madhavan said a number of countries in West Asia are also in touch with the HAL for possible procurement of its key products.

"We now are looking at exports very seriously. A sizeable number of countries are showing lots of interests in the platforms we are producing as they are world class. We are in talks with so many countries," said the HAL chief.

Specifically, he said that Tejas has a "very good" export potential as it is a four-and-half generation fighter jet which can compete with some of the famous military jets in its class.

The Tejas has been developed by Aeronautical Development Agency and the HAL. The lifespan of the jet would be a minimum of 30 years just like any other frontline combat aircraft. The combat jets are classified under various generations depending on their avionics, capability and weapons systems. The current fleet of fighter jets with the IAF range from three-and-half generation to the fourth generation.

The Indian Air Force has already placed an order for 40 Tejas and is likely to seal a contract "very soon" with HAL for another 83 aircraft at a cost of around Rs 38,000 crore (US$ 5.44 billion).

India is one of the largest importers of arms and military platforms, globally. The government has been focusing significantly on promoting defence indigenisation by taking a slew of reform initiatives including liberalising FDI in defence sector.

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

23. Work from home is the bug fix for technology companies operating in India

Livemint, 04 Mar. 2020, Sharan Poovanna, Abhijit Ahaskar, Romita Majumdar, Nandita Mathur

Amid virus scare, Wipro has suspended travel to and transit through mainland China, including Hong Kong and Macau, until further notice
Xiaomi has called off all phone launch events for this month. Realme has put off the launch of Realme 6 on 5 March

Bengaluru/Mumbai/New Delhi: On Tuesday morning, Intel India issued an extensive email advisory to its employees in Bengaluru mentioning travel restrictions, selective home quarantine, guidance to attend large gatherings and even handling packages.

Intel’s pandemic leadership team and emergency operations centre teams are monitoring the situation closely, the tech firm said in the email, adding that it has begun screening visitors, delivery people and new contingent workers arriving at all its sites.

“Security personnel will now ask visitors, delivery people and new contingent workers about recent travel to areas impacted by Intel’s travel restrictions and potential exposure to Covid-19," an employee, who received the email, said on condition of anonymity.

“An Intel employee in Bangalore has potentially been exposed and is currently under quarantine in accordance with government requirements. We’re monitoring the coronavirus situation closely and working to ensure that our employees have the information and resources they need to stay safe and informed," Intel said in a statement.

As the Covid-19 virus sweeps across cities and nations, both domestic firms and MNCs are cancelling key events, adopting work-from-home options and sanitizing workplaces to ensure employee safety.

Xiaomi has called off all phone launch events in March. “We are taking this decision with the objective of reducing exposure risk to coronavirus (Covid-19) for our Mi fans, media friends, partners and Xiaomi employees," the company said in a letter. Xiaomi was expected to launch its Redmi Note 9 series in India on 12 March.

Oppo’s subsidiary, Realme, has also called off its 5 March event in New Delhi to launch the Realme 6 smartphone.

“In light of the current reports of coronavirus impact and related advisory by health officials to maintain social distance as a precautionary measure, I am calling off our biggest event. We will still give live speech in stadium with you watching the event online," Realme CEO Madhav Sheth tweeted on Tuesday.

Home-grown information technology firms such as Wipro Ltd and Tata Consultancy Services Ltd (TCS) have suspended travel to locations prone to the virus, advised working from home and self-quarantine wherever needed.

“Specifically in Italy, as a precautionary measure we have implemented work from home and travel restrictions. This had also been put in place across some countries in Asia Pacific, and is being monitored and modified based on the situation in each location," said a TCS spokesperson.

Bengaluru-based Wipro has suspended travel to and transit through mainland China, including Hong Kong and Macau, until further notice. Employees have been advised to avoid non-critical travel to Singapore, South Korea, Japan and Italy. Wipro has enabled a significant number of employees in China to work from home, implemented thermal screening and use of surgical masks and frequent sanitization of premises there, said a Wipro spokesperson.

For many individuals and organizations, Microsoft Teams videoconferencing, chat and collaboration are helping people continue to work and collaborate. “By making Teams available to all for free for six months, we hope that we can support public health and safety by making remote work even easier," a Microsoft spokesperson said.

Keith Guttridge, a senior analyst at Gartner, who was in Mumbai this week to attend the Gartner Application, Architecture, Development and Integration Summit, said a lot of application-related work could be done digitally. “Gartner employees are communicating largely through digital conferencing methods and work-from-home options. Physical supply chains are likely to be impacted, but software delivery is safe," he said.

Among social media companies with offices in India, Twitter has asked its employees across the world to work from home if they can and join internal meetings remotely. All workplaces and real estate are being deep-cleaned and sanitized and visual reminders encouraging personal hygiene best practices are being set. Pre-packaged, pre-composed, and pre-plated food options are also being given, Twitter’s chief human resources officer, Jennifer Christie, said in a 2 March blog post.

Facebook said it will ban all social visits to its offices worldwide, including India, and job interviews will be held via video conferencing. Amazon too is holding job interviews via videoconferencing.

The spread of Covid-19 has marked a tumultuous start to the year for many tech firms that have either cancelled or postponed annual events and conferences.

On Tuesday, US software company Adobe cancelled its annual digital summit in Las Vegas, due to be held in March, and Google confirmed that the Cloud Next ’20: Digital Connect summit will take place online only from 6-8 April.

24.1. Mahindra starts assembling vehicles in Kenya

IBEF, Mar. 11, 2020

Indian automaker Mahindra & Mahindra became the latest global carmaker to start operations in East Africa’s richest economy as the company started assembling two of its small commercial trucks in Kenya, it said on Monday.

Mahindra's entry follows that of French carmaker Peugeot SA and Germany's Volkswagen AG, both of which announced resumption of local assembly in 2017 and 2016 respectively, after decades-long absences.

The interest in the local new vehicle market by international firms, including Swedish truck maker Volvo AB, is due to increasing government efforts to attract investment in the sector to create jobs, by offering a range of incentives such as tax breaks.

Nairobi is also planning to limit the age of second-hand vehicles that can be imported into the market as part of the drive to encourage investment in local assembly of new vehicles.

Used car imports from countries such as Japan accounts for 85 per cent of annual car sales in Kenya, while the rest are locally assembled or brand-new imports as complete build units.

Mahindra has started to assemble its Scorpio Single and double cabin small trucks at a plant in the coastal city of Mombasa. The plant is owned by its local partner, car retailer Simba Corporation, Mahindra said in a statement.

Mahindra eyeing to use Kenya as an entry point into the wider African market as it looks to grow its share of the commercial and passenger vehicle categories, it said.

Kenya's President Mr Uhuru Kenyatta has asked government officials and local lenders to discuss the ways through which they can offer affordable auto loans to consumers in order to further boost demand for new vehicles, his office said in a statement.

"I shall continue to provide incentives to expand this sector," Mr Kenyatta was quoted as saying in the statement.

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

24.2. M&M to launch a tractor platform jointly with Mitsubishi

IBEF, Feb. 18, 2020

Mahindra & Mahindra Ltd plans to introduce its new range of tractors, developed in collaboration with Mitsubishi of Japan, in order to further strengthen its position both in the domestic and overseas markets.

M&M and Mitsubishi Agricultural Machinery (MAM) entered into a strategic agreement about five years ago and 33 per cent stake in the latter were acquired by the company where aim was to jointly develop products to address global opportunities in the rice value chain.

Mr Pawan Goenka, Managing Director, Mahindra & Mahindra, said, “We are working on a programme for developing a new tractor platform called K2. It will have four tractor variants. These will be designed for both domestic and international markets. The work is primarily done in Japan in co-operation with Mitsubishi Agriculture Machinery. This is the most ambitious tractor development we have undertaken.”

Although, the company didn’t give much details about the new platform, it indicated that it is also working on intelligent tractors to enhance agricultural productivity and tackle the problem of shortage of skilled labour, among others.

This new K2 platform is expected to be launched in mid-2021 and models will be introduced for two years across horsepower ranges.

Though, Mahindra and Swaraj brands are responsible for company’s strong performance in its tractor segment, it has also come out with products with new features under the Novo, Yuvo and Jivo platforms to showcase its technological edge. Mr Goenka said that the tractor market is expected to witness a positive growth of about five per cent in the current quarter. However, the industry will end the fiscal with about seven per cent decline.

For April-December 2019 period, the tractor industry saw a decline of about 10 per cent in domestic sales at 5.66 lakh units. Exports declined by 17 per cent to 59,000 units compared with the year-ago period.

He added, “Though it is too early to predict growth for the next fiscal, we expect about five per cent growth, with plus or minus 2. Rabi sowing has been good and reservoir levels are also good. On this year’s monsoon, El Nino effect is going to be neutral. So, it is expected to be normal, which will augur well for the tractor industry”.

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

25. Toyota Kirloskar Motor launches self-charging hybrid electric vehicle Vellfire

IBEF, Feb. 27, 2020

Toyota Kirloskar Motor (TKM) launched Vellfire, the new luxurious self-charging hybrid electric multi-purpose vehicle in India.

Globally, more than 6,00,000 units have been sold by the company so far and has introduced Vellfire in CBU form, priced at Rs 79.5 lakh (US$ 0.11 million) ex-showroom.

The Vellfire ensure a low fuel consumption and carbon footprint and offers a powerful driving experience, thanks to it being a strong hybrid vehicle.

Studies have shown that strong hybrid vehicles can run 40 per cent of the distance at 60 per cent of the time on electric or zero emission mode with the engine off.

The 2.5-litre 4-cylinder gasoline hybrid engine provide 86 kW (115 BHP) power and a maximum torque of 198 Nm @2800-4000 rpm. The engine, which is coupled with two electric motors and a hybrid battery, controls emissions while delivering a delightful driving experience.

The care offers a spacious interior that assures one of lounge-class travel. Moreover, a new suspension has been adopted for the rear to achieve a luxurious ride, while maintaining stability.

The hybrid engine synergy contributes to a mileage of 16.35 km/l under standard test conditions. The Vellfire comes packed with 17-speaker JBL premium audio, power adjustable seats with Ottoman function, 16-colors ambient light and super long seat sliding function.

Mr Vikram Kirloskar, Vice-Chairman, Toyota Kirloskar Motor said, “The automotive industry in India is undergoing a profound technology-driven transformation with innovation and creativity defining the overall customer experience. As industry leaders, it is imperative for us to challenge ourselves and provide customers with new breakthroughs that not only promise magnificence and comfort, but also contribute to the well-being of the ecosystem.”

“TKM has environmentally-sustainable solutions at the heart of all our business operations and every single vehicle that is manufactured in the plant. Along the lines, our latest offering New Toyota Vellfire too embodies our commitment to offering “Ever-Better Cars with Ever-Better Technology for an Ever-Better Environment,” he said.

The company’s Managing Director Mr Masakazu Yoshimura said, “Globally, we have a caravan of luxury offerings, and the launch of Toyota Vellfire in India marks a significant moment in our journey. Today’s announcement is a significant step in our mid-to-long term plan to achieve zero CO2 challenge.”

Mr Naveen Soni, Senior Vice-President, said, “The Toyota Vellfire offers a perfect blend of superior craftsmanship and comfort while delivering phenomenal fuel efficiency with its self-charging hybrid electric technology.”

Mr Soni added that the Vellfire is well-aligned with Toyota Environmental Challenge 2050, which encourages us to move towards a society where people, cars and nature can coexist in harmony.

The customer feedback has been positive so far, thus far, the first three months of shipments of 180 CBU imported units have all been sold out.

Mr Soni said, “We are not in numbers game but are looking to consolidate our India business.”

On the alliance with Suzuki Motor, Mr Soni said, “This is a mutually-beneficial association and we see immense scope for engagements through the alliance.”

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

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Thursday 19 March 2020

NEWSLETTER, 20-III-2020

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NEWSLETTER, 20-III-2020

– GENERAL POLICY, INFRASTRUCTURES, COUNTRY FINANCES, ETC.

- AGRICULTURE, FISHING & RURAL DEVELOPMENT

India and the World