Volume 24 – No.10 – January 2011
Seminar on Protecting the Patents IPR protection plays a key role in gaining competitive advantage in terms of technological gains for achieving higher economic growth.
In This Issue President’s Message Chamber’s activities – 4 Seminar on Protecting the Patents, Designs and Brands in European Union
P2
Is CSR the Corporate Conscience?
4 FFT on Is CSR the Corporate Conscience?
4 Management Development
Programme on TN VAT
General Committee Expert Committees:
The Chamber organized Food for Thought programme on yet another important and timely topic to deliberate upon namely “Is CSR the Corporate Conscience”? P3
4 HRD
Management Development Programme on Tamilnadu VAT
Policy Watch
To keep the working professionals in the corporates updated with regard to the latest changes in Tamilnadu VAT and its procedural aspects, this program was organised. P5
4 Energy 4 Logistics Spotlight – 4 Wealth from Waste Trade Fairs & Exhibitions Economic Review Others –
4 Memoranda submitted 4 SMCC Meet 4 Legal Metrology Act
27th January 2011
Food for Thought : Is CSR the Corporate Conscience? Addressing the meeting are
Mustafa Moochhala
Ashoke Joshi
V.S. Ramana
The Chamber paid homage to late
Mr. A. Sivasailam
Chairman, Amalgamations Group and former President of Madras Chamber as well as Assocham, who passed away on 12th January 2011. Speaking on the occasion -
Dr. R. Mahadevan
Srinivasan K. Swamy
T.T. Srinivasaraghavan
PRESIDENT’S MESSAGE
Need of the Hour - Evergreen Revolution! Dear Friends Indian Agriculture has made rapid strides since independence from food shortages and imports, to self-sufficiency and exports. One of the 12 Bio-diversity centers in the world with over 46,000 species of plants and 86,000 species of animals recorded, today India is the front ranking producer of many crops in the world, ushered in through the green, white, blue and yellow revolutions. India is the largest producer in the world of pulses, tea and milk. Second largest producer of fruits, vegetables, wheat, rice, groundnut and sugarcane. However, all is not well with Indian agriculture. Less than 17% of India’s income comes from agriculture and close to 60 % of India’s population lives on agriculture! Fortunately, agriculture is back on the agenda. Not because of the farmer’s plight but because of food price inflation, which is fuelling general inflation that has now gone beyond the comfort zone. Historically, India's agriculture growth has lagged growth in the overall economy. In fact, long-term average growth in agriculture has been close to 2%. India's population has been growing at 1.4%. Consequently, India has just managed to maintain its per capita growth in food and non-food crop production.
Without higher agriculture growth, India's 10%
Hence it cannot be industry or agriculture, but
economic growth target will be impossible to
Industry and agriculture. In a mature economy
achieve. In addition, higher real incomes lead
both should coexist and supplement each other.
to higher food consumption, implying more
However the current issues in agriculture are
pressure on demand.
many. The simultaneous occurrence of high
The unique structure of Indian agriculture,
food inflation and large food grain stocks in our
as compared to the industrialised countries
granaries have been a matter of concern and
must be borne in mind. In the industrialised
there is an urgent need to look into the entire
countries, farming is largely a food or
system of food production, procurement and
commodity producing mechanism, while in
distribution. Dr. C.Rangarajan Committee has
our country, farming is the backbone of the
also expressed some genuine concerns on our
livelihood security system for over 60% of
capability to increase food production to the
the population. 80% of the over 115 million
extent needed, the impact of higher government
farming families belong to the small (2 ha and
procurement on open market prices, and the
less) and marginal (1 ha and less) categories.
total cost of the subsidy involved. The proposed
Nearly 60% of the area cultivated depends
National Food Security Act is trying to find
only on rainfall for crop cultivation. This
some answers to that.
has led to the feeling that in the process of
What is required now is a “ Greener
industrialization, especially since the first five
Revolution” or what Prof. Swaminathan
year plan, we have missed out our focus
calls - an “Evergreen Revolution”. A second
on agriculture.
productivity revolution in Indian agriculture,
We have no choice but to accept that the
coupled with diversification to commercial
economy has entered a phase of development
crops, agri-business, processing industries, agro-
which is not only relatively rapid but is also
exports and massive efforts towards afforestation
qualitatively different from past patterns
and wasteland development will generate
of growth, so much so that it is leading to
abundant farm and non-farm employment
disruptions in established forms of
opportunities for the rural workforce. These
economic activity.
in turn will stimulate demand for consumer
Industries do depend on agriculture for
goods and services, giving a fillip to the urban
backward linkages and for a number of
economy and the informal sector as well as
industries raw materials come from agriculture.
rapid expansion of the services sector.
Similarly for agriculture growth to sustain,
This would ultimately provide the space for
forward linkages with industries would give
every sector in the economy to grow and enable
better value addition. For example though
the nation to achieve the dream of a double
India is a forerunner in fruits and vegetables
digit growth.
production, the processed fruits and vegetables account for as low as a figure of less than 3%
Best wishes
whereas in countries like Argentina, Brazil etc it is as high as 70 %. This probably explains for the plight of the farmers as well as the high percentage of post harvest wastages of agricultural products.
T T Srinivasaraghavan President
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CHAMBER’S ACTIVITIES 17th January 2011
Seminar on “Protecting the Patents, Designs and Brands In European Union” In the changing global scenario, the issues of IPR have gained special importance for all sectors. IPR protection plays a key role in gaining competitive advantage in terms of technological gains for achieving higher economic growth. With this view in mind and to create an awareness on IPRs and to understand the business strategies, the Chamber joined hands with UK Trade & Investment, Altacit Global and Forresters, UK in organizing the above Seminar. The programme was held at the British Deputy High Commission, Chennai. Welcoming the gathering the President of the Chamber, Mr T T Srinivasaraghavan, said the complexity of global trade has increased. IPR is something that we often read about, hear about and understand what its dimensions are. The whole business of IPR is becoming more and more complex. However, the reality is that IPR has become critical in the rapidly changing times to do business globally. It is true that things are moving at such a rapid pace and the risks that many of us face are knowledge based. In today’s competitive environment, when a lot of cross border trade is happening, it is not enough just to be innovative and technologically advanced but also should learn to legally protect such knowledge assets. Particularly in sectors like engineering, environment, pharmaceuticals, ICT etc., where Indian industry is maturing, innovating and expanding into newer markets, protecting the intellectual output becomes absolutely essential. The Madras Chamber always had a track record of changes happening and supporting members with knowledge of contemporary interest. With India-EU FTA making some headway, he hoped that many of our members who
have some interest in EU would greatly benefit from the presentations of the expert speakers. The inaugural address was delivered by Mr Mike Nithavrianakis, British Deputy High Commissioner who said UK led the world in the provision of legal services and London has long been the heart of the international legal and financial world. The city is home to a large number of international law firms many of which are among the leading advisers in deals taking place in international capital markets. In a services led economy like that of UK, legal services are one of the key drivers of growth and competitiveness. UK based law firms are ranked consistently high in the league of the world’s largest legal firms. English law is the most commonly used in international commerce and dispute resolution. That London is the preferred location for international arbitration is brought out by the fact that 90% of commercial cases handled by London law firms involve an international party. Sectors where UK solicitors have particular expertise include financial services, communications, energy, transport including shipping and ship building contracts and competition law. The UK legal profession has considerable strength in the areas of arbitration, mediation and other forms of Alternative Dispute Resolution. London is one of the leading centres for ADR with a range of highly respected organisations providing multi industry dispute resolution services including The London Court of International Arbitration, the International Chamber of Commerce and the Chartered Institute of Arbitrators. He said one of the principal reasons for
the success of the legal profession in UK is the liberal, yet stable and predictable environment in which it thrives. Foreign law firms including Indian firms can operate either as full service firms or specialist firms in specific areas of law. Subject to the regulatory requirements, the system even allows overseas lawyers to appear in courts on a case by case basis. He called upon Indian legal firms to join hands with their UK counterparts for fruitful partnerships between the two legal communities. Presentations were then made by Dr Sudhir Ravindran of Altacit Global, Mr Matthew Shaw of Forresters, UK and Mr Matt Barton of Forrester & Boehmert, Germany. Brief details are given below: Dr Sudhir Ravindran: Giving an overview of Intellectual Property, Dr Sudhir Ravindran said investors value intellectual property; IP can alter the competitive landscape and can generate huge financial gains. He gave the example of Gillette which maintains its No. 1 position by patenting every aspect of its razor design. He also gave the case study of KFC, the world’s most popular chicken restaurant chain which holds the 68 year old secret success recipe! Referring to Philip’s experience, he said as an innovative company, its patent filings had risen substantially and its current IPR portfolio was – 80,000 patents based on 16,000 inventions, 26,000 trade marks, 15,000 designs and 1600 domain names. It does approximately 2600 new filings per year. From a technology rich company it has turned itself to Rich Technology company he said. Mr Matthew Shaw: Making his presentation on Protection of Brands & Designs in EU, Mr Matthew Shaw said geographically EU is not Europe. The Office for Harmonisation in the International Market (OHIM) is responsible for community registered designs and trademarks.
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CHAMBER’S ACTIVITIES On filing he said there is a registration fee/ publication fee and filing cost covers 5 years design protection in EU, renewable every five years to a maximum of 25 years. The fee per design decreases with multiple designs. He said one could file multiple designs in one application. European registered designs are cost effective and get strong protection. He said use your imagination with community registered designs which are quickly obtainable and enforceable. On EU trade marks he gave some hints and tips such as – Take advice on best mark to register, a black & white is better than a colour mark and check the meaning of the mark since there are many EU languages. Mr Matt Barton: Mr Matt Barton made a presentation on European Patent Registration Securing. He explained as to what can be patented in Europe, how the process works and how can patents benefit one’s business. European patents are granted for any inventions, in all fields of technology, provided that they are new, involve an inventive step and are susceptible of industrial application e.g. machines, electronics, components, chemicals, industrial processes, foods, formulations, chemical processes, alloys, etc… What cannot be patented in Europe are things that are “not inventions” according to the European patent office and that they are ”excluded from patentability” by the EPO. He detailed the procedure for preparing the application , the claim structure, filing, etc. Concluding he said, if you have inventions that are patentable in Europe, have potential value to your business, then crystallise the invention into an European patent; turn the idea into property that has actual value and then leverage that value – sell, assign, work or enforce.
27th January 2011
Food for Thought:
Is CSR the Corporate Conscience? The Chamber organized Food for Thought programme on yet another important and timely topic to deliberate upon namely “Is CSR the Corporate Conscience”? CSR is stated to be the alignment of business operations with social values, integrating the interests of stakeholders into the company’s business policies and actions. CSR is expected to address the so-called triple bottom line – People, Planet and Profit. It is viewed as a corporate gesture to give back to the society, in which they have grown and prospered. Many Indian industries have been following the corporate philanthropy without much ado even earlier. However, with the economic development gaining momentum on the one side and the subjects like inclusive growth gaining significance on the other, CSR has attained new dimensions. Also, the Government’s thinking through the recent Companies Bill about making CSR mandatory for corporates is throwing open lot of points to ponder. To have a more thought provoking discussion on this subject, the Chamber organized this programme with the participation of three eminent faculties who made excellent presentations - Mr Ashoke Joshi, IAS (Retd), Chairman, Srinivasan Services Trust, Mr V S Ramana, General Manager & Head –
Corporate Communications, Larsen & Toubro Ltd. – ECC Division and Mr Mustafa Moochhala, Managing Director, Innobridge Consulting Pvt.Ltd. Mr T T Srinivasaraghavan, in his welcome address said that FFT idea which had started a few months ago has received a lot of appreciation from our members. This is a forum where ideas, topical and contemporary, are discussed and debated. He requested the audience to keep feeding the Chamber with ideas and with topics that will be of interest to the Chamber and to the society at large. Coming to the topic of the discussion he said we live in challenging and troubled times. On the one hand, there are significant challenges that we face in terms of governance; on the other, there is lot of activism that is pushing for greater corporate responsibility. During the India Corporate Week Celebrations held in December, a question was posed to the Hon’ble Minister Salman Khursheed, then Minister of State for Corporate Affairs, whether CSR is mandatory. He was quick to clarify that it was not the intention. For us as Indians regardless of our background, regardless of our religion, the Indian ethos have always been that charity is close to godliness. We have grown up believing that the left hand should not know what the right hand gives.
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CHAMBER’S ACTIVITIES As Companies, as business organisations, all of us owe something back to the society which gave us everything. The world has become a global village and it is our duty to reach out to those around us. His address was followed by the presentation of the speakers: Mr Ashoke Joshi, IAS (Retd) Giving a brief of the Srinivasan Services Trust (SST) of which he was the Chairman, Mr Ashoke Joshi said SST is the social arm of TVS Motor Company, started in 1996. It has a team of 127 persons, all professionally qualified, who work full time and 124 of them live and work in the villages. They cover 6 lakh people in 715 villages in four States. SST’s vision is to provide integrated and sustainable rural development. The shareholders, the suppliers, the employees etc. are certainly part of the business but the community is also a stakeholder he said. Businesses exist because community exists and businesses grow when the community is financially strong, healthy and educated. We have to give back to the community whose resources we utilize. The communities must take ownership of what is going on. Everyday 9000 children die of malnutrition in India and for every 100 girls enrolled in primary schools only one reaches high school. The thrust areas identified by them have been: 4 Economic Development 4 Health 4 Education 4 Environment; and 4 Infrastructure The results of SST intervention have been – savings of self Help Groups to the tune of Rs. 8.47 crores; reduction of private money lenders from 398 to 71; 55771 families earn over Rs 10,000 per month and 39 per cent of the elected members of the local bodies are from SHGs. There are 2500 SHGs who have received
bank loans to the rune of Rs. 28.16 crores and the repayment has been 99.9%. SHGs is a strong force and the status of women has tremendously improved. On health care he said there is reduced family expenditure; morbidity due to communicable diseases reduced from 42% to 4.5% and volunteers take up periodic mass cleaning of villages. On education, there is 100% enrollment and retention of children in schools; 53% of the students passing high school exams get enrolled in professional courses. He also gave examples of community toilets built by them and the reforestation of 1,40,000 hectares of land. The result of all this has been – 43 tons of vermin compost generated per month; density of forest cover increased ; increase in water table because of which farmers grow crops in hitherto wastelands. The benefits of CSR have been–community harmony; reduction in crime, reduction in migration due to unemployment and confident and empowered citizens. Concluding he said for sustainable results, one should: 4 Respect local culture and practice 4 Win the trust of community, be part of the community; meet the needs of the people, let them take ownership 4 Enable and empower people to take decision 4Be totally transparent If anyone is interested in starting this effort in their location, SST was ever ready to share its experience. Mr V S Ramana: L&T which has a direct workforce of 35,000 has made CSR an actionable business agenda. CSR – is it a heart or the conscience of the corporates? He said it is neither of the two. Sharing, caring, and inclusivity is only the way ahead. Corporate social initiatives have been a
pre-requisite to corporates for being able to sustain business in the future. Be it – economic sustainability; environnmental sustainability; societal sustainability or financial sustainability. The importance of CSR in sustainable initiatives have been – resource conservation; waste management and pollution control; L&T’s Build India scholarship and their Construction Skills Training Institute which was started 16 years ago. He said there is need for 3 crore skilled construction workers. The focus areas identified by L&T under their CSR initiatives have been: 4 Healthcare – mother and child 4School education 4Environment 4 Environment enhancement –greening with Isha Foundation He said in need of urgency, their project teams were always there to help – whether it was tsunami, earthquake, etc. The spouses of executives of L&T run an NGO ‘Prayas’. Prayas in its 14th year now, has 34 affiliates across India with 1400 members. They have a medical centre in Virugambakkam which caters to a vast number of people in and round that area. He said corporate sustainability reporting helps in creating a process and employee involvement at all levels to usher sustained projects and programmes. Mr Mustafa Moochhala: Speaking on what is happening in the CSR world, Mr Mustafa said there are three actors in CSR namely – State, Market and the Civil Society consisting of institutions/ NGOs. There are competing views on CSR namely – Role of business is to be in business; role of business as a member of society since it is created by society and role of business should be adding value to social efforts. There is more wealth available now – the market cap which was Rs. 5.5 lakh crores in 1999 has gone up to Rs 70 lakh crore in 2010. He said the GDP has grown,
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CHAMBER’S ACTIVITIES the Government spending has grown, individual giving has grown and corporates are keen on CSR. With so much Government funding, why we are still poor he asked? Why do girls drop out of schools? Business has huge role to play in actually making a progressive India. Very few companies collaborate with other companies; why not we join hands with others? he asked. He also felt that if some difference has been made in the area of education, why not in other areas? He said the following were of extreme importance namely: 4 Eradicate extreme poverty and hunger 4 Achieve universal primary education 4 Empower women: promote gender equality 4 Reduce child mortality and improve maternal health 4 Combat HIV/AIDS , malaria and other diseases 4 Ensure environmental sustainability and develop a global partnership for development Giving some statistics, he said 20% of India is below poverty line and every second young child in India is malnourished. Less than quarter percent of rural population use toilets; only 4 out of l0 girls who enroll complete eight years of education and there are 25 crores of people without safe drinking water. There were many ways of engagement in CSR activities namely project based partnerships, sectoral forums, private sector expertise, NGO expertise, volunteering, fund raising, identifying groups for support, etc. The challenges were :Raising further awareness of CSR; making the case to the local business community to adopt CSR; transferring competencies to companies from individuals; getting the corporates not to float own NGOs; transparency; remove suspicion and the need to build capability of NGOs to collaborate.
29th January 2011
Management Development Programme on Tamilnadu VAT To keep the working professionals in the corporates updated with regard to the latest changes in Tamilnadu VAT and its procedural aspects, the Chamber organized a full day Management Development Programme on Tamilnadu VAT at Hotel Savera.
give clarifications after verifying with the concerned department officials. He said 60% of the assessees were using e-filing method and he hoped that 100% would be possible in course of time. He said some more banks have been added to accept e-payments.
The programme was inaugurated by Mr. S. Krishnan, IAS., Commissioner for Commercial Taxes, Government of Tamilnadu.
Presentations were then made by the faculty as follows:
After a brief welcome address by the Secretary General, Mr P.R Sudhakar, Chairman of MCCI Expert Committee on VAT gave a brief overview of the critical issues which the Chamber has been representing from time to time. A memorandum was also submitted to the Chief Guest on this occasion. Addressing the participants Mr Krishnan said, after he took over as Commissioner this was his first external meeting. He commented that the Department was moving with the tax payers and business leaders in a friendly way and the department officials would always be ready to interact with the business leaders. The purpose of bringing out VAT Act for Tamilnadu is to enable the assessees and the corporates to simplify the working and to have transparency in the system. The Government is trying to achieve reasonable percentage of tax collection in relation to the GDP growth through VAT System. Some of the issues would be sorted out during the GST regime. He said Traders, corporates, dealers and such of those persons closely connected with the Department, should come forward to share their experiences. This would be helpful to focus on clean administration. The Commissioner pointed out that some of the issues raised by the Chairman of the VAT Committee would be attended soon. On some of the issues, he agreed to
Mr K Guruswamy: Registration procedure including cancellation, Implication under TN VAT Act Mr P.R Sudhakar: Input Tax Credit Scheme & Procedure ITC on inputs; ITC on capital goods; ITC reversal mechanism/stock transfer, etc., under TN VAT Act Mr P Purushotham: Computation of Taxable Turnover – Deemed sales, works contract and TDS Scheme and procedures, issues of concern Mr P Sukumar Filing of monthly return, revised return and e-filing of returns, procedures and issues of concern Mr K Vaitheeswaran: Provisions relating to assessments, appeal and revision procedures; re-opening of assessment/Deemed assessment and leasing transaction under TN VAT Act Mr P R Subramaniyan: Refund mechanism for export sales as well as sales to SEZ and connected issues At the floor participation, the participants raised a number of queries which were suitably clarified by the faculty. The programme was well attended by about 90 participants.
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CHAMBER’S ACTIVITIES 27th January 2011
Homage to Mr A Sivasailam, Chairman, Amalgamations Group and former President, MCCI & Assocham:
The Chamber paid homage to late Mr. A. Sivasailam, Chairman, Amalgamations Group and former President of Madras Chamber as well as Assocham, who passed away on 12th January 2011. A minute’s silence was observed after which Dr R Mahadevan, Mr Srinivasan K Swamy and Mr T T Srinivasaraghavan spoke. Addressing first, Dr R Mahadevan, Group Technology Director, India Pistons and Member of the General Committee of the Chamber said the demise of Mr Sivasailam was a great loss for industrial houses, the Amalgamations Group, the farming sector, the agricultural sector, and a large number of spiritually minded people. He had deep knowledge of human resources. A humane person, he had touched the lives of countless people and countless organizations. He had great attention for detail which differentiated him from all others. He added glory to the number of offices he held. Speaking next, Mr Srinivasan K Swamy, former
President of the Chamber said Mr Sivasailam was one of the earliest persons who believed in organizing seminars and conferences which provided opportunities for people to meet, get to know each other and also improve their business. Apart from his own group companies, he promoted and nurtured many educational institutions. He left an indelible mark on each of these institutions and companies. A very determined person, he would fight to win. Addressing next, Mr T T Srinivasaraghavan, President, MCCI said we have lost an individual who has embodied everything about corporate India. He lived a life of simplicity. He was a man of high ambitions, caliber and humility and a great mentor. The loss is in several ways. However, we should feel blessed that we had the good fortune of having a person of his stature who has touched our lives. For the Chamber has was not only the President, but was a life long friend. He was a man who did not know how to say ”No” to any cause that is worthwhile and of public interest.
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GENERAL COMMITTEE 8th January 2011 The Committee deliberated on the following:
MCCI – Skill Development Initiative: The President recalled that as part of the 175th year celebrations activities, Avalon Consulting had been engaged to help draw up a road map and revitalise the Chamber. They have recommended a few things in Phase I of their study, which are under implementation by the secretariat. In Phase II, they have now been asked to get involved in the Skill Development initiative of the Chamber. He felt that with the State Government being focused on developing skills, this subject fits in very well with our own agenda for the 175th year. The representative of Avalon Consulting made a presentation of their preliminary thoughts and explained to the Committee how this can be taken forward. There were active discussions on this subject and some of the suggestions given by the members were: 4 Skill development should include Soft Skills Training also. 4 The model should be replicable and should be capable of being extended to centres like Coimbatore at a later point. 4 Other players like MMA, Reach IIT, TVS, etc. who are already into a few skill training initiatives should also be approached for their advice and suggestions. While on this Mr Ganguly of L& T mentioned about their training facilities for construction industry and offered to take the Consultants for a visit to their skill centre. It was decided that a detailed project plan should be prepared and presented to the Committee in the next meeting and the way forward would be decided thereafter. The President reported on the following meetings:
MCCI & Palkhivala Foundation – Lecture on “The Real significance of Scams” – 18th December 2010: A joint programme was organized by MCCI & Palkhivala Foundation on 18th December on the above which was addressed by Mr.Arun Shourie and Mr.N.Vittal. The programme was well attended by members of both the organizations and was also well covered in the media. The Committee was informed of the forthcoming programmes organized by the Chamber.
Membership: During January, six new companies joined the Chamber as members. The Committee expressed its happiness that more and more companies were evincing interest in becoming members of the Chamber.
Arrears of Subscription 2010-11: Noting that there were still 18 companies who were yet to pay the subscription and several reminders had already been sent to them, the Committee decided that they be removed from the rolls on the 31st January.
Website revamping: The Secretary General gave a demo of the revamped website which will go live shortly. She explained some of the new features of the website like Ask the Expert (where members could raise their queries relating to the particular committee), Job Board – where members could post vacancies in their companies, members’ area where members could update details of their companies, etc.
Members also gave some suggestions like uploading the memoranda submitted by the Chamber, which were taken note of.
Visit of Parliamentary Committee on DTC: Members were informed that a Standing Parliamentary Committee on Finance under the Chairmanship of Mr Yashwant Sinha would be visiting Chennai in the first week of February (proposed 2nd Feb).
Pre-budget memorandum: The Chamber’s pre-budget memorandum was ready and the President informed that the same be sent to the Ministry of Finance after being vetted by one or two members
Chamber Diaries: This year, the Chamber had printed special diaries, depicting in brief, the history of the Chamber, which were handed over to the members. The diaries were also distributed to Government officials, institutions with which the Chamber closely associates as well as to the media.
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EXPERT COMMITTEES
HRD 19th January 2011 The Committee met on 19th January. Members of the Committee expressed that there were a number of issues and practical problems in respect of Labour laws and Inspectors of the Labour Department were asking unwanted questions during their inspection. Due to this, compliance has increased for the corporates. Further, different sectors of the corporates are represented in the HRD Committee of MCCI and the focus of each sector as far as HR is concerned would be different. From the point of CSR, many CSR initiatives have been taken by the corporates at the Board level which is the decision making authority for CSR. CSR covers all aspects of corporate governance and has grown in importance in recent years. CSR is all about how companies conduct their business and its impact economically, socially, and environmentally. CSR practices increase a corporate’s competitive edge, its reputation, publicity and employee commitment. The expenditure on CSR is a huge investment for the betterment of corporate which creates goodwill to the society.
Workplan: The Committee desired to organize the following programmes. 4 One day Workshop on Knowledge of Labour Laws for Better Compliance during April covering ESI and Provident Fund issues as well. 4 conference on Education Reforms involving Government, corporates, National Skill Development Centre, Tatas etc. 4 Programme related to HR along with MMA
Establishing MCCI Skill Development Centre: The Secretary General informed that as
part of MCCI’s 175th Year Celebrations, the Chamber has started initiatives to set up a Skill Development Training Centre at Koppur village, Tiruvallur where the Chamber has acquired land. Avalon Consulting, a member of the Chamber, have been requested to give us a roadmap. Preliminary discussions have taken place with regard to this initiative. Still a number of formalities are to be fulfilled to get to a final shape. The Consultants plan to meet all the HR officials of MCCI member companies to understand the views of the corporates. The Chamber will periodically keep the members informed of the progress of the setting up of skill development centre.
MCCI Website: The Committee was informed that the Chamber’s website has been re-designed and most of the important features have been highlighted in the home page itself. The Chamber has created a template “Ask the Expert”. The purpose of this is if any member has an issue for clarification, they can post their queries in the particular space provided and the query would be forwarded to the respective Chairman /CoChairman of the Committee for his reply and will be transmitted to the concerned party. The technical details are yet to be completed to activate the template and would be ready within a fortnight. The Committee welcomed this feature and felt that this would be one of the easy ways to seek clarifications from the experts. 21st January 2011
Energy The Committee noted that the power position in Tamilnadu is becoming worse day by day and industries are suffering. Frequent load shedding and power cuts affect the industries a lot. The Government is not taking enough steps for improving power generation and there is undue delay on the part of companies who have signed agreements to supply power. The manufacturing and service industries contribute substantial revenue to the
Electricity Board and consume very less percentage of the total power generated. The Government should treat the industries as a privileged customer of the TNEB, but it is facing tremendous power shortage. Government should take some positive policy initiatives immediately. The long term solution for meeting power shortage would be to have more participation of Independent Power Projects and Captive Power Projects. On-going power projects have to be completed quickly. As per reports, the power generation projects in the State to the tune of 6000 MW are to be completed by 2013. The installed generation capacity in the State is 15800 MW which is inclusive of 5000 MW of renewable and non-conventional energy. Presently the power deficit is 12-15% and if all the proposed plans materialise ,the deficit situation is expected to be reversed by 2013. The Committee felt that there is no meaning in promoting more industries, when the power cannot be made available even to the existing ones. Tamilnadu Government should seriously think of taking some tangible steps to monitor the demand for power in the State immediately and adequate forward planning should be done. The Ministers and Politicians should set an example by not wasting huge power for their road side meetings for which the power is often wired from the consumers’ meters for which they are paying. There should be co-operation in all levels between several national bodies such as IREDA, MNRE, Ministry of Power, Ministry of Environment, State Electricity Regulatory Commissions and State Electricity Boards. Power being critical for development, suitable policy measures to encourage energy saving should be introduced. States should come forward in attracting the investors and stakeholders to come in large numbers for investing in the renewable energy sector. A combination of public investments and policy incentives and regulations has to be promoted for
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EXPERT COMMITTEES clean, climate friendly and energy efficient power sector. The Chairman pointed out that the power cut at present is 20% both in demand and energy. The power calculation during the power cut is as follows: 4 The maximum consecutive three months’ energy consumed is taken as base prior to power cut. 4 The highest recorded demand in any single month is taken as base. 4 For those who use other than TNEB power like Windmill and Third party power, this is deducted from the overall consumption. 4 TNEB is penalising the consumers who use wind mill power, though in Tamilnadu the power generation by wind mills is over 25-30%. The industries are allowed to buy power from the Energy Exchange or Indian Energy Exchange who are the authorised power trading agencies. The Electricity Board is not adhering to the policies of Regulatory Commission. Earlier, any power issues /quota issues were handled by technical officials but now all these matters are handled by Commercial officials who are not aware of the technical requirements. The practice of billing used to be on 30th of every month and payment to be made within a week’s time. Now there is deliberate delay, wrong billing etc. and bills are sent to the consumers at the last moment and they are forced to pay on time , without even verifying the calculations. The Chairman said the main reasons for the power problems in Tamilnadu are: 1. Theft 2. No proper maintenance 3. Non- installation of power stations 4. Non-adherence to safety norms 5. Failure in generation. 6. No proper distribution mechanism.
The Committee felt that a strong representation should be made to the Government as early as possible. Further, the Committee felt that the Chamber could plan a one day seminar on Energy in March 2011 and this was agreed to. 28th January 2011
Logistics The Committee met on 28th January. The Chairman and Co-Chairman felt that there were many problems being faced in the logistics trade particularly in port. For the economic development of India, they felt a well functioning seaport system is necessary. To realise the economic growth potential, the attention needs to be given to development and modernization of logistics trade. To become globally competitive, importance must be given for development of infrastructure in sectors like roads, airports, seaports, railways etc. in general and port sector in particular as the ports play a vital role in the overall economic development of the country. Logistics sector is growing and various projects are underway in terms of port development and infrastructure development but many of them are not being completed on time and there is enormous delay due to problems in the overall logistics segment. The Rail-Road connectivity between land and ports needs immediate attention to ensure a smooth flow of traffic which would enable the exporters to ensure smooth export. The Government should also develop minor ports with proper equipments facility, infrastructure and administration and some of the exports could be diverted to the minor ports to avoid traffic in the major ports. Minor port development would also provide job opportunities for the local people. Multiple authorities are involved in large infrastructure projects resulting in absence of integrated planning and coordination.
that the Madras Chamber could plan for a comprehensive study over the concerns of the logistics trade focusing Sea Port, Air Port, Rail and Road and inter connected issues. The study would be necessary for the Chamber as a host of issues could be brought through this and this would provide an opportunity for the Chamber to present the same to the Government. Further, the Chairman and Co-Chairman suggested conducting a course on logistics which may improve the employability of students particularly arts and management graduates. The Co-Chairman also said that the Chamber has already taken an initiative in promoting skill development and this could well fit in that objective. There are logistics courses available for the post graduation and advance level in logistics trade but there is no institution which teaches the basic levels of logistics trade. A number of job opportunities are emerging now in the logistics trade and this course could perhaps prepare a few students to take up the job soon after graduation. The Secretariat agreed to this proposal and to work on further details in consultation with the committee The Committee also discussed about organising a Management Development Programme on Export & Import Procedures and planned the same in March after the Union Budget.
Congratulations MCCI conveys its congratulations and best wishes to Mr K Raghavendra Rao, Chairman & Managing Director, Orchid Chemicals & Pharmaceuticals Ltd., who has recently been conferred with "Padma Shri" Award. We wish him many more laurels in the years ahead.
The Chairman and Co-Chairman also felt
9
SPOT LIGHT - WEALTH FROM WASTE
Waste Hierarchy
The waste hierarchy refers to the 3Rs of reduce, reuse and recycle, which classify waste management strategies according to their desirability. The 3Rs are meant to be a hierarchy, in order of importance. The waste hierarchy has taken many forms over the past decade, but the basic concept has remained the cornerstone of most waste minimisation strategies. The aim of the waste hierarchy is to extract the maximum practical benefits from products and to generate the minimum amount of waste. Some waste management experts have recently incorporated a 'fourth R': "Rethink", with the implied meaning that the present system may have fundamental flaws, and that a thoroughly effective system of waste management may need an entirely new way of looking at waste. Source reduction involves efforts to reduce hazardous waste and other materials by modifying industrial production. Source reduction methods involve changes in manufacturing technology, raw material inputs, and product formulation. At times, the term "pollution prevention" may refer to source reduction. Another method of source reduction is to increase incentives for recycling. Many communities in the United States are implementing variable rate pricing for waste disposal (also known as Pay As You Throw - PAYT) which has been effective in reducing the size of the municipal waste stream.
Rethinking Waste The 3Rs are categories at the top of our disposal options. They include a variety of initiatives for disposing of discards. Reduce - to buy less and use less. Incorporates common sense ideas like turning off the lights, rain barrels, and taking shorter showers, but also plays a part in Composting/Grasscycling (transportation energy is reduced), low-flow toilets, and programmable thermostats.
Includes the terms Re-think, Precycle, Carpool, Efficient, and Environmental Footprint. Reuse - elements of the discarded item are used again. This could be in a different form from the original discarded items. Recycle - discards are separated into materials that may be incorporated into new products. This is different from Reuse in that energy is used to change the physical properties of the material. Initiatives include Composting, Beverage Container Deposits and buying products with a high content of post-consumer material.
Incentives for 3R The 3R’s of reduce, reuse and recycle have been considered to be a cornerstone of ecological awareness and a way or promoting environmental balance through conscious behaviour and choices. It is generally accepted that these patterns of behaviour and consumer choices will lead to savings in materials and energy which will benefit the environment. Some of the incentives for strengthening 3Rs could be to reduce the tax on goods that are made by recycling used materials, such as paper, plastics, glass, metals. Another example may be to reduce tax on second-hand goods, which may include books, clothes, house-hold gadgets, bicycles, cars and automobiles, office equipments, and so forth. An additional approach may be to reduce the interest rates on the loans, for companies for their commercial activities in the recycling, re-use and resale of used material and equipments. It is plausible that this may have a significant impact on consumer behaviour, and may strengthen those sections of the economy and trade that are associated with such goods and services. Additionally, this would be consistent with supporting consumer behaviour and choices that are beneficial for the environment and for the economy.
ITC's Wealth Out of Waste is a recycling initiative that works towards spreading awareness about recycling, and encouraging people to segregate and dispose waste responsibly. WOW is an internationally recognised initiative by Bureau of International of Recycling. BIR is a world wide international trade federation representing the world's recycling Industry, promoting recycling across the globe. In this programme, WOW reaches out to schools, institutions and homes through its awareness building teams, about source segregation of waste. After a stipulated period of time, the WOW team goes back to collect the waste kept aside by schools/institutions/ homes, and pays them for the recyclables collected. While many countries have advanced systems of waste collection and regulations on source segregation, awareness in India regarding recycling and its benefits is low. There are basically two types of waste: dry waste and wet waste. About 40% of the dry waste can be recycled while wet waste can be converted into compost and can be used as manure. The WOW programme seeks to not only build awareness, but also to encourage people to segregate their waste at the source which is their households. This reduces the amount of waste filling up the landfills - and provides industries with clean raw materials. For example, ITC's Kovai unit is exclusively dependent on recycled fibre,as are some machines in Bhadrachalam as well. By end 2011, ITC PSPD would be using close to 210,000 tonnes of waste paper per annum. WOW helps ITC collect this raw material from India. Recycling of waste has huge environmental and economical benefits. Recycling of one tonne of waste paper saves 17 trees and 7,000 gallons of water.Through WOW, ITC helps to deal with various issues like environment protection, reduction of global warming, improving green cover, reducing landfills, improving ground water quality, general health and hygiene, reducing garbage handling costs, better civic amenities and providing cost competitive raw materials to industries. Source : itcgreenpapers.com
10
SPOT LIGHT - WEALTH FROM WASTE
Waste to Energy - An Environmentally Sound Approach By M V Ananthakrishna, Executive Director, M K Raju Consultants Pvt.Ltd.
1.0 Introduction The Environmental problems of waste disposal can be dealt with effectively using the non-incineration based Concord Blue Waste to Energy Technology (CBT). CBT accepts any type of organic waste (Agricultural, Forestry, Municipal including plastic, Tyres, Hospital Biomedical, Poultry Litter, Palm Oil & Hotel) and converts into power. This can be done with no capital investment from the client. 2.0 Process Description 2.1 Preconditioning: Un-segregated Municipal Solid Waste(MSW)/Organic Waste is preconditioned in a completely automated segregation & sorting unit. 2.2 Gasification: The preconditioned waste is subsequently conveyed to the Concord Blue System (CBS) that thermo chemically degrades the waste in an inert atmosphere to produce a syngas that is rich in hydrogen and free from tar and other pollutants. 2.3 Power Generation / Fuel Substitution: This syngas is then fed into a gas engine to
produce electricity. It can also be used to replace more expensive fossil fuels (both liquid and solid) in boilers, kilns etc.
Completely modular system which can 4 be sized to handle 70 Tons / day (1 MW Power to 700 tons / day (10 MW Power)
The following Process Flow Diagram refers.
4 Minimal rejects to landfill – Only construction and demolition debris and ash from the CBS
3.0 Environmentally Friendly The Concorde Blue Technology is environmentally friendly since the waste is not burnt, and adheres to emission regulatory standards around the globe (adheres to MSW Rules 2000). The solution is self-sustainable, i.e. no additional fossil fuel is required for the system post start-up as the system caters to its captive heat and power requirements. 4.0 No Capital Investment Required No Capital Investment is required from the client. Only tipping fees (competitive rates) to be paid for waste disposed. Projects can be implemented on Build Own Operate & Transfer (BOOT) or BOT or BOO basis. 5.0 Salient Features / Advantages:
4Receipt of waste all days. No stoppage due to climatic variations; Waste disposed on the day of receipt. No pile up of waste. 4 Customized to suit the characteristics of the Indian Municipal Solid Waste that typically exhibit high moisture, high ash and low calorific value. 6.0 Sum up All the organic waste generated in a locality or Industry can effectively be converted without any pollution on daily basis to generate power. Projects can be implemented on a Build Own Operate & Transfer (BOOT) basis with no investment from the client.
4 Low space requirement (e.g. – a 700 tpd MSW to Energy plant takes only 2.5 acres)
11
SPOT LIGHT - WEALTH FROM WASTE
Conversion of Plastic Waste to Value Added Items By R Narasimhan, Director, Protech Consultants Pvt Ltd
CONCEPT 1.0 INTRODUCTION: The Plastic articles have become an important part of our daily life. The plastics are used in package of food products, beverages, drugs, medicinal fluids and in the production of Television, Computer, Piping, Aircraft, Doors & Windows, Sports materials, Refrigerators, Toys, Furniture and Garments. The plastics are used all over the world because they are safe for packaging of foods, medicines and child care products. A few examples are – milk pouches, edible oil container, ice cream pack, blister packs for tablets and capsules. I.V. fluids, IV and catheter tubing and collected blood is stored in plastic bags. Plastic products have become essential in our daily life and are very difficult to replace the same with any alternate materials which are safe and durable. 1.1 Plastics is mainly used in 4 Agriculture and Water Conservation 4 Electronics and Communication 4 Consumer Durables 4 Industrial Accessories, Refrigerator, Airconditioning 4 Education 4 Medicare - Blood Bags, IV Bottle, Tubing catheter, Disposable Syringes, Packaging 4Transportation, Automotive components like Bumper / Dash Board, 4Packaging 4Building and Construction 4Doors, window, wiring, conduits, etc. 1.2 Plastic end use pattern in India 4Packaging (Food, Medicine): 23% 4Agriculture: 22% 4Building & Construction: 24% 4Telecom / Electronic: 16% 4Transport (Accessories, Seats): 6% 4Health & Medicare: 2% 4Defence and Others: 2%
4Furniture / Application: 5% -------- 100% --------1.3 The versatile property of plastics lends itself to wide range of usage. The food articles packed in the plastics protect the food from Bacteria and maintain hygienic condition and prevent infection. While plastic crockeries are generally use and throw, glass and metal crockeries need water for washing and reuse. In spite of its versatility and usefulness, the plastic usage has problems and environmentalists are against its increased usage. 1.4 In the present day society, no one can pass a day without touching or handling or indirect use of plastic material of some kind. However, Plastic materials have become a very hot subject for environmentalists. It is mainly due to the indiscriminate disposal of plastic waste by the public. 1.5 In US & UK the per capita consumption of plastic is 50 kg. per annum. Whereas in India, it is only 2.75 Kg.per annum. In India 4-5 million tons plastics are used every year which is very low per capita consumption compared to other developed countries. The solid waste generated in cities and municipalities is made up of 4Organic material 33% 4Paper and Board 30% 4Glass and Metal 16% 4Plastic 8% 1.6 In view of the problems in disposal of plastic waste which are non biodegradable, in some countries, they have started using paper and cotton bags for carrying materials and reduce the use of plastic bags. 1.7 It is ironical the production of paper and processing of cotton requires, various chemicals and large volume of water apart from substantial amount of energy.
Therefore the solution is not the use of alternative materials like paper or cotton which does not solve the pollution problem but the judicious use of plastic bags and articles with proper disposal mechanism. The chemical and ingredients used in production of paper and cotton and water, will result in increased pollution, affecting the environment. 1.8 The best solution will be to diligently use plastics and reuse or recycle the waste into value added articles without causing damage to environment. In USA, China, Japan and Europe, there are number of facilities for processing post consumer plastic waste. While there is considerable research work going on for conversion of plastic waste by process pyrolysis for converting into carbon, it appears that it will be very expensive and common viability has not yet been proved. Few Companies in USA have established facilities for production of lumber from the plastic waste. The individual companies have developed their own compounding technique and use mixture of waste of polymers in different proportion. Ultimately the process is to convert the mixture of plastic waste into lumber by extrusion process which is converted into various shapes by using suitable moulds.
MCCI Conference Room The Chamber's Conference Room is available for hire. Ideal for meetings, interviews, etc. Has a seating capacity of 26. Charges: Full day - Rs 4000 (for members) Rs 5000 (for non members) Half day - Rs 2000 (for members) Rs 3000 (for non members) LCD Projector - Rs 1000 (full day) Rs 500 (half day) For details, contact: MCCI: Mrs J Edwards Tel: 24349452/24349871
12
SPOT LIGHT - WEALTH FROM WASTE
Flow Scheme for Recycling of Post Consumer Plastic Waste Post Consumer Plastic Waste
House Hold Waste
Hotel/Hospital Waste
Scrap Dealers
Street Waste
Dump Yard
Rag Pickers
Scrap Wholesalers
Recyclers
Conversion to Article s
Sorting & Cleanin g
Moulding into Lumbe r
Grinding / Cleaning / Drying Extrusion
ESSENTIAL ELEMENTS OF RECYCLING OF PLASTICS WASTE
TECHNOLOGY OPTIONS FOR RECYCLING OF PLASTIC WASTE:
PLASTICS WASTE RECYCLING FACILITATE
4A stable supply source which involves reliable collection and sortation.
4In-House recycling in processing industries
4Clean Environment
4Product to Product approach
4Employment opportunities
4Monomer to Monomer
4Economical products
4Mixed plastics to oil
4Manufacturing of numerous recycled products which substitute conventional materials for cost effectiveness, viz. synthetic wood, garden furniture, pallets, fencing post, etc. and a source of energy.
4An economical, proven and environmentally sound recycling process and 4End-use applications for the recycled polymer which yield economic market values and capture consumer confidence.
4Mixed plastics to plastic lumbers 4Mixed plastics to energy
4Business opportunities.
13
SPOT LIGHT - WEALTH FROM WASTE
GO GREEN, AT WORK Offices can be brutal to the environment. With all the electricity being used for lights and computers, plus all the paper and office supplies going into the garbage every day, there certainly are a lot of environmental hazards. The good news is that cutting down on the environmental waste is very easy to do in offices. By simply putting a few practices into motion, you can easily make your office space a green space! Some easy to implement tips are given below.
Turn down the heating or air conditioning when you leave for the day so that there’s no energy being wasted when there’s no one there.
Change printer settings so that “Draft” qualities are being printed rather than “Best.” This will reduce the amount of times you’ll need to print the document.
During the summer months, close the blinds partially. This will keep the room from heating up and using more air conditioning.
3. Share Stationary
Use only as much water and coffee grinds as you need for your office. If you’re the only one drinking coffee, don’t make a whole pot.
1. Save Electricity
2. Reduce Supplies
Instead of taking the elevator every day, use the stairs. Not only will you be saving energy, but you’ll also be getting your daily dose of exercise too!
Keep track of how much paper and toner you use. Just keeping track of how much paper you’re wasting is sure to make you pay attention to it and reduce the number. Use any paper that can’t be used for scrap paper. Use it to take messages, write reminders, etc.
Turn your lights off every time you leave your office or area, even if it’s only for ten minutes. The notion that you use more electricity turning lights on and off simply isn’t true. You use less electricity when you aren’t using it. Use windows to their maximum capacity. Draw back the curtains and let all that natural light in! You might not even need to use a light at all. Turning off your cell phone when it’s finished charging is another great way to save electricity. Leaving your phone turned on once it’s finished charging actually uses just as much electricity as when it’s charging.
Instead of making copies of very large documents, email them or put the document together in a Power Point presentation. When possible, read documents on the computer rather than printing them out. Always use the “Print Preview” option before printing something out. This will let you see if there are mistakes in your document and save you from printing it out twice. Email phone messages and other messages instead of writing them on paper.
Use energy saving tools on devices such as computers, printers, and photocopiers. Check to see if any of these have a standby feature that they could stay in when not in use or shut them down when possible.
Regularly update mailing lists and delete any that are out of date.
When it’s time to leave for the day, unplug all of the machines. When machines are kept plugged in, there is still electricity moving through the plug. Unplug everything, and know that there is no electrical activity going on when you’re not there.
Create business cards for departments rather than for individual people.
Don’t use fax cover sheets when you don’t absolutely have to.
Use scrap paper that has writing on one side to create draft documents. Always make sure that all staples and paper clips have been removed.
Ask that reports be printed once and passed around the office for everyone to read instead of printing out a different report for every person. Share supplies such as staplers, hole punches, etc. instead of buying each person their own. Use labels that can be reused for sending out packages and then reuse the packages. Use tape dispensers and pens that are refillable rather than buying new ones. 4. Recycle Buy recycled paper products. Make sure that anything that will be going through a machine such as a printer or photocopier can handle high volumes of recycled paper. Also buy re-manufactured toner rather than buying new. Use recycling bins. Set a few up for paper, aluminum, and cardboard and place them throughout the office. Use a reusable mug for your coffee instead of using a paper or plastic cup several times a day. Car pool with a friend on the way to and from work or take the bus. 5. Pass It On Tell your office that you’re going green and encourage everyone to join in! Going green is especially important in today’s day and age when everyone’s worried about using up our resources and reducing consumption. Office spaces are one of the easiest places to go green, and maybe even save some overhead costs too!
14
POLICY WATCH
RBI hints at rate hike to contain inflation Indicating strong actions to contain inflation the Reserve Bank of India said that containing inflation will have to be the predominant objectives of monetary policy in the near-term since persistent high inflation could endanger the growth objective and also amplify risks to inclusive growth. High month-over-month inflation in recent months as also the rising price index of the non-food manufactured group suggests the combined impact of both inputs costs and demand pressures.
$ 15b target set for India – South Africa bilateral trade Buoyed by the massive growth recorded in trade between India and South Africa and the huge potential it holds for the future, the two countries have decided to set a target of achieving $ 15 billion bilateral trade by 2015. The two countries are also set to breach the $ 10 billion two-way trade target by next month. India is South Africa’s largest trading partner in South and Southeast Asia and one of South Africa’s top ten trading partners globally. Total trade has more than doubled since 2004-05 to cross $ 7.5 billion.
Financial Sector : India seeks IMF evaluation: India has voluntarily sought a
comprehensive financial sector assessment programme by the International Monetary Fund and the World Bank as the country has been found to be compliant with Internationally accepted financial standards. The Centre is determined to carry out reforms in the financial sector with financial stability becoming an integral part of policy discussions. The Centre would soon set up a Financial Sector Legislative Reforms Commission. The Commission would rewrite and clean up financial sector laws and bring them in line with the requirements of the sector.
China, India open banking sectors: India and China have agreed to grant permission to each other’s banks to open branches and representative offices, apart from setting a bilateral trade target of $ 100 billion to be achieved by 2015. The Reserve Bank of India and China Banking Regulatory Commission signed an MOU for increasing banking and financial cooperation between them.
New Coastal Regulation Zone: In a move that could protect the livelihood of seven million fishing families, promote economic activity in the coastal region and preserve coastal ecology, Ministry of Environment and Forests notified the Coastal Regulation Zone notification, 2011. The new notification replaced CRZ 1991. In the latest notification the “no development zone” is being reduced from 200 metres from the high tide line to 100
metres only to meet the increased demands of housing of fishing and other traditional coastal communities.
Government announces Rs 500 crore incentives for exporters: The Government announced a Rs 500 crore package to help exporters of some sectors which are yet to recover from the slowdown. The incentives announced by Commerce Minister, Mr Anand Sharma are expected to help these sectors to face the fragile demand recovery in key markets, particularly Europe. The sectors for which incentives have been announced include agriculture, chemicals, carpets, engineering, electronics and plastics. Incentives have been provided to enhance the competitiveness of products which are labour and technology intensive. Exporters of pharmaceutical products would be required to use barcodes on their export products from July 1, 2011 as per global standards to facilitate tracking and tracing of t heir products. This provides assurance about the quality of Indian pharma products to prospective importers. Exports to 15 nations which include Brazil, Australia, New Zealand, China and Japan would qualify for incentives announced by the Minister. The incentives would be provided under different schemes such as Focus Market and Focus Products from January to December 2011.
Forthcoming Programmes 2nd March 2011 Workshop on Central Budget and the Finance Bill Participation fee: Rs 750/- for members (Rs 1000/- for non-members). 4th March 2011
Programme on Post-Union Budget at Maraimalai Nagar (SRM Hotel, Kattankulathur) Participation fee: Rs 800 per participant.
10th March 2011 Memorial meeting in honour of Mr A Sivasailam Hotel Sheraton Park
16
ECONOMIC REVIEW (As on 15th February 2011)
Section ECONOMY 4India's economy seen growing at 8.6 per cent in FY’11
4Food inflation dips to 13.07 per cent
4India’s industrial output grows 1.6 per cent in December 2010
4India's exports grow by 32.5 per cent to USD 20.6 billion in January 2011
4FDI in December 2010 up 30.6 per cent to USD 2 billion
4India's per capita income to grow 17.3 per cent at `54,527 in FY'11
REPORTS 4India most preferred to set up back-end IT units: Report
4Climate change to cause more migrations in Asia Pacific: ADB
ECONOMY
India's economy seen growing at 8.6 per cent in FY’11 India’s economy is set to expand by 8.6 per cent in the fiscal year ending in March as against 8 per cent in the previous year. The data released by the Central Statistics Office (CSO), shows agriculture powering the country’s overall economic growth, rising smartly to 5.4 per cent from a dismal 0.4 per cent in the year before. While manufacturing growth is projected at 8.8 per cent, same as last year, the services sector is seen slipping marginally to 9.6 per cent against 10.1 per cent in the previous year, largely because of a slower rise in government spending.
wholesale price index of food articles in the country plummeted to 13.07 per cent during the week ended 29 January 2011 against 17.05 per cent in the previous week. The index for ‘Primary Articles’ group declined by 1.4 per cent, the index for 'Food Articles' group declined by 2.8 per cent and the index for ‘Non-Food Articles’ group rose by 2.5 per cent. The index for ‘Fuel, power, light & lubricants’ group remained unchanged at its previous week's level.
India’s industrial output grows 1.6 per cent in December 2010
Food inflation dips to 13.07 per cent
India Inc., the growth in industrial production plummeted to 1.6 per cent in December 2010 the lowest in 20 months because of a sharp contraction in the capital goods sector and the base effect of last year’s high growth.
The annual rate of inflation based on the
The Indices of Industrial Production for the Mining, Manufacturing and Electricity
sectors for the month of December 2010 recorded the growth rates of 3.8 per cent, 1.0 per cent and 6.0 per cent as compared to December 2009. The cumulative growth during April - December, 2010-11 over the corresponding period of 2009-10 in these three sectors have been 7.7 per cent, 9.1 per cent and 4.7 per cent respectively, which moved the overall growth in the General Index to 8.6 per cent.
India's exports grow by 32.5 per cent to USD 20.6 billion in January 2011 India's exports grew by a healthy 32.5 per cent year-on-year to USD 20.6 billion in January, 2011 on account of increasing demand in the western markets. During April-January this fiscal, the country's shipments went up by 29.4 per cent to USD 184.6 billion. Imports in January, 2011 is estimated to increase by 13.1 per cent to USD 28.6 billion over the same period last year, leaving a trade deficit of USD 8 billion during the month under review. During April-January, 2010-11, imports rose by 17.6 per cent to USD 273.6 billion. Sectors that registered healthy growth during April-January, 2010-11 include gems and jewellery, engineering and petroleum and oil lubricants.
FDI in December 2010 up 30.6 per cent to USD 2 billion Snapping two months of declining trend, foreign direct investment (FDI) in India increased 30.69 per cent to USD 2 billion (about ` 9,000 crore) in December 2010 In
17
ECONOMIC REVIEW
Growth of Industrial Production in December 2010
Advance Estimates of GDP at Factor Cost by Economic Activity (At constant 2004-05 prices) Industry 1.Agriculture, Forestry & Fishing 2. Mining & Quarrying 3. Manufacturing 4. Electricity, Gas & Water supply 5. Construction 6. Trade, hotels, transport and communication 7. Financing, Insurance, real estate & business services 8. Community, social & personal services 9. GDP at factor cost
Rs. Crore Percentage change over previous year
2008 - 09
2009 -10 (QE)
2010-11 (AE)
654,18 97,244 655,775 83,344 332,557 1,087,575
656,975 103,999 713,428 88,654 355,918 193,282
692,499 110,482 776,337 93,133 384,282 324,049
0.4 6.9 8.8 6.4 7.0 9.7
5.4 6.9 8.8 5.1 8.0 11.0
706,712
771,763
853,795
9.2
10.6
545,184
609,724
644,656
11.8
5.7
4,162,509
4,493,743 4,879,232
8.08
December Sectors Mining
In 2009-10, India's FDI had declined to USD 25.88 billion from USD 27.33 billion in the previous financial year. FDI inflows in October 2010 dipped by about 40 per cent to USD 1.4 billion over the year ago period. In November too, it dipped by 7 per cent to USD 1.6 billion. The main sectors that attracted FDI include services (financial and non-financial), telecommunications, housing and real estate, construction activities and power. Countries including Mauritius, Singapore, US, UK, Netherlands, Japan, Germany and UAE are the major investors in India.
India's per capita income to grow 17.3 per cent at ` 54,527 in FY'11 India's per capita income is projected to grow by 17.3 per cent to `54,527 in 201011 from `46,492 in the year-ago period.
2010-11
3.8
8.7
7.7
Manufacturing 19.6
1.0
8.9
9.1
Electricity
5.4
6.0
5.7
4.7
General
18.0
1.6
8.6
8.6
Source: CSO, India
.6
QE - Quick Estimate AE - Advance Estimate
However, during the nine month period (April-December) of the current fiscal, FDI declined 23.14 per cent to USD 16.03 billion over the year ago period. India had received USD 20.92 billion in FDI during the same period of the previous fiscal, 2009-10.
2009-10 2010-11 2009-10 11.1
Source: Central Statistical Organization, India
December 2009, India had attracted FDI worth USD 1.54 billion (` 7,185 crore).
April-December
Per capita income is calculated by evenly dividing the national income among the country's population. However, the increase in per capita income would be only 6.7 per cent in 2010-11 if it is calculated on the basis of 2004-05 prices. Per capita income (at 2004-05 prices) stood at `36,003 in FY 2011 against `33,731 in the previous fiscal, according to the latest data on national income. The size of the economy at current prices is projected to rise to ` 72,56,571 crore at the end of the current fiscal, up 18.3 per cent from ` 61,33,230 crore in FY 2010. Based on 2004-05 prices, the Indian economy is projected to expand by 8.6 per cent in the current fiscal ending March 2011. This is higher than 8 per cent growth in fiscal 2009-10. The country's population is expected to increase to 118.6 crore at the end of March 2011, from 117 crore in fiscal 2009-10.
India most preferred to set up back-end IT units: Report India has emerged as the most preferred destination for global enterprises to set up their back-end information technology units or captive units in 2010, according
to the consultancy firm Everest Group. "India witnessed the maximum activity, followed by other regions in Asia and the Philippines," says a release issued by the consultancy. Unlike the practice of outsourced work wherein an Indian company erects a facility and employs professionals, captive unit involves a multinational corporation setting up its own unit in a country, attracted usually by the talent pool of that country. Among those who set up facilities in India in 2010 include Microsoft which set up a development centre in Bangalore, audit firm PricewaterhouseCoopers' centre in Kolkata and Credit Suisse's facility in Mumbai. Globally, 2010 observed a positive surge with the number of captive set-ups exceeding the divestures, according to the report.
Climate change to cause more migrations in Asia Pacific: ADB More and more people from Asia and the Pacific region are expected to migrate in the coming years, as climate change is expected to result in extreme weather conditions, according to ADB. The Asian Development Bank (ADB) whispered that typhoons, cyclones, floods and drought are forcing more and more people to migrate. The multilateral lender noted that natural calamities in countries such as Malaysia, Pakistan, China and the Philippines, caused temporary or long-term dislocation of millions.
18
OTHERS Calling governments to prepare themselves for increased migration due to climate change, the report whispered that no international cooperation mechanism has been set up to manage these migration flows.
State Manufacturing Competitiveness Council:
On the other hand, the reports whispered if properly managed, climate-induced migration could actually facilitate human adaptation and create new opportunities for dislocated populations in less vulnerable environments.
The Chamber has representation on this Council. On behalf of the Chamber, President, Mr T T Srinivasaraghavan and Secretary General, Mrs K Saraswathi attended the meeting.
Representation on Tamilnadu Value Added Tax: Taking advantage of the presence of Mr S Krishnan, IAS., Commissioner of Commercial Taxes, Government of Tamilnadu at the inauguration of the Management Development Programme on TN VAT , the Chamber submitted a representation to him covering issues such as : 4 Request for filing revised returns 4 Quarterly submission of 'C' forms 4 Works contract - taxable turnover – profit percentage 4 Zero rating 4 Sale to SEZ unit/developer 4 Transit pass provision, etc. Mr Krishnan offered to discuss the issues with his officials and do the needful.
Pre-Budget Memorandum to Union Government: The Chamber has forwarded its Pre-Budget Memorandum to the Union Finance Minister covering issues in Direct Taxes, Indirect Taxes, Service Tax, etc. for his sympathetic consideration. Copies of the memorandum have also been sent to the Secretary, Revenue, Ministry of Finance, Chairman, CBEC and Chairman, CBDT.
The State Government convened the first meeting of the SMCC on 21st January at the Taj Coromandel Hotel.
The focus of the first meeting of SMCC was to draw a road map for enhancing manufacturing competitiveness of industries in Tamil Nadu and recommend suitable policy initiatives particularly in sectors like Automobile and Auto components, Bio technology, ICT etc. as may be required for augmenting the growth of the manufacturing sector in Tamil Nadu. There were presentations by Deloitte , ICRA and IMaCS on certain critical subjects like Global Competitiveness, Skill gaps, etc.
Legal Metrology Act, 2009 By repealing 1. The Standards of Weights and Measures Act, 1976 and 2. The Standards of Weights and Measures (Enforcement) Act, 1985 the Govt. of India has enacted the Legal Metrology Act, 2009 which will be enforced throughout the country from 1st March 2011.
The manufacturers / packers / importers of the pre packed commodity will have to register themselves with the Director or Controller of Metrology within a period of 90 days. All the details of the said Act and Rules are available on website -http://fcamin.nic.in/ Events/EventListing.asp?Section=Weight and Measures.
Cricket Tournament for Logistics Fraternity Logistics Friends Club proposes to conduct a Cricket Tournament for the Shipping/ Logistics fraternity (consisting of CHAs/ Steamer Agents/NACFS etc.) Expected day of inauguration�: 3rd April 2011 Venue: Mayajaal Cricket Ground (Twenty-20 match) C/o. Mayajaal Entertainment Ltd., 34/1 East Coast Road, Chennai 603 112. Registration: 1st February to 28th February 2011. Members wishing to send teams may contact: Vaishnavi Friends Club Ph: 25242797/98 Email: vfc@vaishnavigroupcomm.com
Congratulations
to our Member Company Larsen & Toubro Ltd. for winning the award
Similarly by repealing the Standards of Weights and Measures (Packaged Commodity) Rules, 1977 the Central Govt. has made the Legal Metrology (Packaged Commodity) Rules, 2011 which will also be enforced from 1st day of March 2011.
'COMPANY WITH BEST CSR AND SUSTAINABILITY PRACTICES 2011'
Most of the provisions of the said Act and Rules are same as in the old Act and Rules. However, now there is a provision to nominate a responsible person / partner or director under the new Act.
Wishing you many more such awards in the years ahead!
instituted by the Asian Centre for Corporate Governance and Sustainability.
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Trade Fairs & Exhibitions 2011 Malaysia 1 - 5th March
17th Malaysia International Furniture Fair
Libya 2-12th April
40th Tripoli International Trade Fair
India Trade Promotion Organisation (ITPO) has organised national representation in this Trade Fair. The display profile include: Coffee, Tea, Spices, Sugar and sugar confectionery; Inorganic chemicals; articles of leather, travel goods, paper and paper board, silks, carpets, textile floor coverings; Articles of apparel, clothing accessories, cutlery; consumer electronics, Refrigerators, garments and textiles, pharmaceuticals, etc.
For participation, please contact: Mr V Narayanan, Manager, ITPO, Chennai, Tel: 28524655/28554655 Email: itpochn@md4.vsnl.net.in
China 15-19th April
Phase I
23-27th April
Phase II
1-5th May
Phase III
Singapore 23-26th March
MTA 2011- The Precision Engineering Industry Event
Canton Fair
Sri Lanka 16-18th June 2011
5th Power Sri Lanka 2011 (for details visit www.cemsindia.com)
22-25th November
AnaLabAsia 2011 – The Thirteenth International Scientific & Analytical Technology & Equipment Exhibition and Conference
22-25th November
CIA 2011 – The 17th International Plant Technology Exhibition & Conference
New Members The Chamber extends a warm welcome to the following new members: Trivitron Healthcare Pvt. Ltd. Business: Import of manufacture &service of medical Equipment
R Subramanian & Co. Chartered Accountants
XS Real Properties Business: Property Development
Packet One Software Pvt.Ltd. Business: Product development, Network communications
TTK Healthcare Ltd. Business: Manufacturers of Pharmaceuticals
Mecaplast India Pvt.Ltd. Business: Interior & Exterior Automotive Engine Parts
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Mike Nithavrianakis addressing.
Seminar on “Protecting the Patents, Designs and Brands In European Union� l to r: Matthew Shaw, T T Srinivasaraghavan, Mike Nithavrianakis, Dr Sudhir Ravindran and Matt Barton.
T T Srinivasaraghavan presenting a memento to Mike Nithavrianakis.
l to r: P.R. Sudhakar, S. Krishnan & P.R. Subramaniyan
Management Development Programme on Tamilnadu VAT S. Krishnan, IAS addresssing
K. Saraswathi welcoming the participants
A view of the audience