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INDIA NEWSLETTER www.indianembassy.at

Published by the Embassy of India, Vienna Year 5 • Issue 52 • April 2015

MAKE IN INDIA CHEMICALS

India Newsletter • 1


Embassy of India, Vienna

The new Government has prepared a five pillar strategy to drive India’s growth, which offer multiple avenues of collaboration and investments

■■ Infrastructure Development

■■ Manufacturing Growth

■■ Skill Development

■■ Energy Sufficiency

■■ Improved Business Environment

www.makeinindia.com 2 • India Newsletter


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NEWS FLASHES

01

The Government of India has unveiled

05

Passenger vehicle industry of India is

11

The Reserve Bank of India has allowed

companies to issue rupee-

a five-year plan for lifting

expected to grow at 5-7 per

India’s exports with a new

cent during 2015-16 and by

denominated bonds abroad

trade policy that seeks to

8-10 per cent in 2016-17.

that will address both pricing

make the country a bigger

06

and currency risks, while

player in global trade by doubling overseas sales to US$ 900 billion by 2019-20, while giving a boost to the ‘Make in India’ initiative

02

India’s e-commerce market is expected

India’s travel and tourism economy

is poised to grow by 7.5 per cent in 2015 over last year.

07

that

The total hardware addressable market includes

networking routers

wireless products,

and

switches

is

to touch US$ 76 billion by

expected to reach close to

2021 from US$ 12-13 billion

US$ 1 billion in India in 2015.

in 2014.

03

08

Eleven influential Indian-American

Digital commerce market in India is

investors feature in Forbes

expected to touch Rs 1.08

magazine’s annual list of the

trillion (US$ 17.30 billion)

100 best venture capitalists.

by end of 2015, a 33 per cent

09

increase over a year ago period.

04

Banks deposits in India have grown

by 11.62 per cent to reach Rs 8,554,045 crore (US$ 1.36 trillion) for the fortnight

opening a window for rupeedenominated instruments to trade abroad.

12

India’s participation at Hannover Messe :

296 companies. 120 business delegations. 16 states. 1 lion.

13

Indian-born Nobel laureate

Mr

Venkataraman

Ramakrishnan

has

been

named the President of the prestigious Royal Society, a self-governing fellowship consisting

of

nearly

1,600 fellows and foreign

India has been ranked 37 in the

members, founded in 1660

Open Government Index,

and support excellence in

across 102 countries, which

science.

measures the government

14

openness

based

on

the

general public’s experiences and perceptions.

10

to

recognise,

promote,

The Ministry of Railways has

sanctioned implementation of Eastern Dedicated Freight

The digital ad spending in India

Corridor (EDFC) and Western

was recorded at 8.7 per cent

(WDFC) with freight train

(US$ 1.22 trillion) from a

in 2014 and is expected to be

speeds of maximum 100

year ago.

over 11 per cent in 2015.

kilometres per hour (Kmph).

ended March 6, 2015, as against Rs 7,663,535 crore

Dedicated Freight Corridor

India Newsletter • 3


Embassy of India, Vienna

NEWS ARTICLES OECD: India’s GDP to grow 7.7 per cent in 2015

T

he Paris-based Organisation for Economic Cooperation and Development (OECD) boosted its forecast for India significantly to 7.7 per cent gross domestic product (GDP) growth in 2015, 1.3 percentage points higher than it was previously, while for China it trimmed its forecast by 0.1 points to 7 per cent. “India is now expected to be the fastest-growing major economy in 2015-16, overtaking China,” said the OECD, which predicted growth accelerating to 8 per cent in 2016 versus 6.9 per cent in China. For economies representing some 70 per cent of the global economy: the US, Euro Zone, Japan, Britain, Canada, China, India, Brazil, the OECD highlighted that it was now expecting GDP growth of 4 per cent in 2015, up 0.1 points from its previous November 2014 prediction. Relaxed Rules for FDI in Construction and Real Estate Sector The Indian Government amended the FDI policy regarding Construction Development Sector. The amended policy includes easing of area restriction norms, reduction of minimum capitalization and easy exit from project. Further, in order to give boost to low cost affordable housing, it has been provided that conditions of area restriction and minimum capitalization will not apply to cases committing 30% of the project cost towards affordable housing. Relaxation of FDI norms are expected to result in enhanced inflows into the Construction Development sector consequent to easing of sectoral conditions and clarification of terms used in the Policy. It is likely to attract investments in new areas and encourage development of plots for serviced housing given the shortage of land in and around urban agglomerations as well as 4 • India Newsletter

the high cost of land. The measure is also expected to result in creation of much needed low cost affordable housing in the country and development of smart cities. This information was given by the Minister of State (Independent Charge) in the Ministry of Commerce & Industry Smt. Nirmala Sitharaman.

India receives highest FDI in 29 months

T

he foreign direct investment (FDI) to India doubled to US$ 4.48 billion in January 2015, the highest inflow in last 29 months, from US$ 2.18 billion in January 2014. The foreign inflows have grown to touch US$ 25.52 billion during the April-January 2014-15, up 36 per cent year-on-year (y-o-y), from US$ 18.74 billion in the corresponding period last fiscal, according to Department of Industrial Policy and Promotion (DIPP) data. The top 10 sectors receiving FDI include telecommunication which received the maximum FDI worth US$ 2.83 billion in the 10 month period, followed by services (US$ 2.64 billion), automobiles (US$ 2.04 billion), computer software and hardware (US$ 1.30 billion) and pharmaceuticals sector (US$ 1.25 billion). India received the maximum FDI from Mauritius at US$ 7.66 billion, followed by Singapore (US$ 5.26 billion), the Netherlands (US$ 3.13 billion), Japan (US$ 1.61 billion) and the US (US$ 1.58 billion) during AprilJanuary 2014-15 period. Healthy inflow of foreign investments into the country helped India’s balance of payments (BoP) situation and stabilised the value of rupee. India is estimated to require around US$ 1 trillion over 5 years to overhaul its infrastructure sector, including ports, airports and highways to boost growth. The Government of India is taking steps to boost FDI and has recently relaxed FDI norms in

sectors including insurance, railways and medical devices.

Narendra Modi means business: 10 highlights of PM’s tour of France and Germany

I

n both France and Germany, Prime Minister Narendra Modi sought to address problems in areas where investors found it cumbersome to do business in India because of unnecessary rules and complicated procedures. Modi spoke about country desks, set up under the aegis of Invest India, which will network with different states so that any investor willing to do business in any part of India will find a single window to get a walkthrough guidance on procedures and norms. Following a successful trip to France, Modi was in Germany on Tuesday and would later fly to Canada for the final leg of his three-nation nine-day tour. Here are 10 highlights of Modi’s France and Germany visit: ■■ 1. India has huge potential to become a manufacturing hub: Modi to NRIs in Berlin Linking India’s economic progress to national “self-respect”, Modi said on Monday night that the country has huge potential of becoming a manufacturing hub and asked Indian professionals in Germany to act as a “bridge” between the two countries. “There is a big demand of time that India becomes a manufacturing hub. If we lose this opportunity, we will regret later,” Modi told NRIs while addressing a reception hosted in his honour. Addressing Indian professionals working in Berlin, the PM said they should show “enthusiasm” and “become a bridge between India and Germany to help realise our objective of making India a


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manufacturing hub. It will be a winwin situation for both the countries.” ■■ 2. Will make corrections where required: Modi to German CEOs Modi’s pitch for attracting foreign investors to boost his ‘Make In India’ initiative came at the inauguration of the Indo-German Business Summit at the Hannover Fair where he and Chancellor Angela Merkel opened the India Pavillion. Modi told top German businessmen and industrialists not to go by “old perceptions” but to come to India and feel the change in the regulatory environment. Making an all-out bid to woo German investors, Modi also promised to make “corrections wherever required” to make India a global manufacturing hub. “Make In India is a need. We are confident that our journey to make India a global manufacturing hub cannot be stopped that too by our own rules and regulations. We must and will make corrections wherever (they are) required,” Modi said to cheers of the gathered audience that included top CEOs of companies from both the countries. ■■ 3. We have re-energised Indian growth engine: Modi’s op-ed article in German daily Pledging a stable and transparent tax regime, Modi wooed global investors saying development is “not a mere political agenda” but an “article of faith” and sought international support to achieve the objectives crucial for growth. “We have re-energised the Indian growth engine. The credibility of our economy has been restored. India is once again poised for rapid growth and development,” Modi wrote in an op-ed article in the German daily Frankfurter Allgemeine Zeitung. “It is the only emerging economy where growth rate is rising. The prospects are even better,” he wrote. “My interactions with leaders of USA, Russia, France, Japan and China have all aimed at creating enduring partnerships with shared stakes in global development and

well-being,” he said. ■■ 4. Entire world is looking at India: Modi at Hannover Messe “The entire world is looking at India. Demography, democracy and demand are attracting the world to India,” said Modi after inaugurating the India Pavilion at the Hannover Messe, the world’s largest industrial fair in which India is the partner country, with Merkel. “Not only Germany, the whole world is looking at India,” Modi said. “Low-cost manufacturing, efficient governance and no-defect manufacturing makes India a global engine in the manufacturing centre,” he said. The Prime Minister invited the whole world to come to India and increase their partnership with the country and make use of the opportunities India offer to scale new heights of success. ■■ 5. Make in India lion is a symbol of new India: Modi at India Pavilion Saying that the Make in India lion was a “symbol of new India” and a “national movement”, Modi told the audience at the Hannover Messe that his government has moved “with speed, resolve and boldness” to create a stable economic environment, including by opening up FDI in insurance, defence and railways, building a stable tax regime and assured protection of intellectual property. In his inaugural address, Modi said, with Merkel listening keenly, that all the credit rating agencies have spoken “in one voice of optimism about India. We know that the wind is blowing in the right direction, and it has made us the fastest growing economy in the world.” He said during a time of political instability and economic challenges and with threats of violence, “India will do its part as an anchor of economic stability, an engine for growth, and, as a force of peace and stability in the world.” ■■ 6. India signs Rafale deal The Indian decision to buy 36 Rafale

fighter aircraft in fly-way condition “as quickly as possible” marks bypassing of the log-jammed deal for supply of 126 aircraft. For this, an inter-governmental agreement will be signed under “separate terms and conditions” which will be discussed by officials. “The two leaders agreed to conclude an Inter-Governmental Agreement for supply of the aircraft on terms that would be better than that conveyed as part of a separate process underway,” said a joint statement by the two countries. “The delivery would be in timeframe that would be compatible with the operational requirement of IAF and the aircraft and associated systems and weapons would be delivered on the same configuration as had been tested and approved by Indian Air Force and with a longer maintenance responsibility by France,” it added. ■■ 7. Deal to fast-track Jaitapur N-plant With India and France agreeing to expedite the setting up of the Jaitapur Nuclear Power Plant, the move is expected to help settle several long-pending issues, including those regarding the technicalities and pricing of the project. During PM’s visit to France, India signed two agreements related to the plant. The first, a preengineering agreement signed with AREVA, Alstom and Nuclear Power Corporation of India (NPCIL), aims to bring greater clarity on all technical aspects of the project. The agreement is also expected to allay apprehensions of the Indian side, especially with the new EPR (European Pressurised Reactors) technology, which are to be used in Jaitapur. ■■ 8. 20 pacts signed between India and France With ‘Make-in-India’ being the theme, the two sides signed about 20 pacts, covering areas like civil nuclear energy, urban development, railways and space. India Newsletter • 5


Embassy of India, Vienna

During the PM’s three-day stay, France pledged 2 billion euros for sustainable development in India as Modi invited investments and technology from this country. Modi also visited the the manufacturing facility of aircraft manufacturer Airbus which announced its decision to enhance outsourcing in India from 400 million euros to 2 billion euros over the next five years. ■■ 9. French connection to Indian Railways A pact was signed during Modi’s France visit for cooperation between Indian Railways and French railways for this semi-high speed rail project. Under this, French National Railways has agreed to co-finance an execution study for “a semi-high speed project on upgradation of the Delhi-Chandigarh line to 200 kmph”. The study will be the first step towards execution of the semi-high speed train project on the DelhiChandigarh route, said a senior railway ministry official involved with the project. ■■ 10. India seeks UNSC seat as a right, China supports Modi made a strong pitch for India to be given a permanent seat at the UN Security Council, saying that it is not asking for it as a favour but as a “right” - having sacrificed the lives of 75,000 soldiers in World War I, being the largest contributor to the UN Peacekeeping Mission and being a land of the Buddha and Mahatma Gandhi. China, which is yet to fully endorse India’s permanent membership of the UN Security Council, has said it supports India’s “desire” to play a bigger role at the UN and will strive to work out a “package plan” to reform the powerful organ of the world body. “We attach great importance to the role and status of India as a major developing country in regional and international affairs,” Chinese foreign ministry spokesperson Hong Lei told the media in Beijing, responding to Modi’s remarks. 6 • India Newsletter

As part of his nine-day tour, Modi arrives in Canada on April 14 for a two day visit, the first bilateral visit by an Indian prime minister in 42 years. Indian and Canadian negotiators are also rushing to iron out differences in a long-stalled foreign investment protection pact in time for Modi’s visit to the north American nation next week.

India is expected to become the first country in the world to have no duplicacy in the voters’ list

I

ndia is expected to become the first country in the world to have a biometric data and no duplicacy in the voters’ list after linking of Aadhar card with voter identity card, said Mr H S Brahma, Chief Election Commissioner (CEC), Government of India. “When we are able to seed the Aadhar figure (number) on Epic card that will ensure that there is not a single duplicate number. We will do it definitely by 2015 and then India will be the only country in the world where there will be complete biometric of voters. There will be not a single fraud or duplicate voters,” said Mr Brahma. Everyday lakhs of voters are seeding their names with Aadhar card on their own. We do not want to make it compulsory but our voters themselves want it. It is a good gesture, added Mr Brahma. So far, 850 million Indians have received their Aadhar numbers. Once the Aadhar number is mentioned in the electoral rolls then individual voters can also change their address online because Aadhar will be the basic identity. It will remove all allegations of duplicacy in the voters list and harassment to voters in changing their address.

MoU Signed Between Hitachi India Ltd, Siemens Ltd and CII for smart city initiative

H

itachi India Limited and Siemens Limited signed a MoU with CII in the capital to form a consortium that would create pilots and replicate them throughout the country for setting up 100 smart cities. The MoU was signed on behalf of Hitachi by their MD, Mr. Ichiro Iino and MD, Siemens Ltd, Mr. Sunil Mathur and DG, CII Mr. Chandrajit Banerjee in the presence of DIPP Secretary Mr. Amitabh Kant. Speaking on the occasion, Mr. Amitabh Kant said that while cities occupy only 3 % of the total geographical area of the world, they contribute nearly 80% of GDP and 2/3rd of global emissions. Hence, there was a challenge to do urbanisation in an innovative and systematic manner. Mr. Kant said that learnings gathered from the best practices across the world in the management of water, public resources, public spaces and technology etc shall be shared while implementing the smart cities concept in India. He said that smart city initiative shall be driven by technology driven companies. Earlier, in his address, DG,CII said that this MoU provides a platform for coming together of leading technology companies such as Hitachi and Siemens and this will enable the implementation of vision of hundred smart cities.

Ford opens Sanand plant to triple exports from India

D

etroit-headquartered Ford Motor Company’s Indian arm inaugurated its second factory in this country at Sanand, 30 kilometres from Ahmedabad. The arm showcased its upcoming car from the site, a compact sedan, Ford Figo Aspire. The company said it had planned to establish India as an export hub. Also, it wanted to triple its exports from here over five years.


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Anurag Mehrotra, executive director for marketing, sales, and service, Ford India, said half of the combined production from their Sanand and Chennai units would be for export. The company, however, did not wish to put a figure to the target. Nigel Harris, the president of Ford India, said the Figo Aspire would be launched in the second half of the year. The initial production would be for the domestic market and the company would eventually focus on exporting the model. With 240,000 cars and 270,000 engines a year at the $1-billion (Rs 6,200 crore) factory here, Ford’s capacity in the country would rise to 610,000 engines and 440,000 vehicles annually. Mehrotra said it planned to launch three models in the Indian market over 12 to 18 months. Sanand, the company said, was one of its most highly automated plants across the globe. Mehrotra said the body shop was 95 per cent automated and the paint shop almost fully. “There are 125 stations along the production line that have been set up for quality checks,” he said. “There were more than 437 robots at the facility.” Gujarat chief minister Anandiben Patel said the factory would create direct and indirect employment for more than 4,000, and the company’s vendor park nearby would give employment to more than 6,000. Calling the 125 km SanandHansalpur-Vithalapur belt, with the connected nodes of Kadi and Halol, a major automobile hub in the making for the Asia-Pacific region, she said an investment of about Rs 15,000 crore in all had already been committed by various companies, to create annual capacity of 1.25 million four-wheel and two mn two-wheeled ones. Another Rs 10,000-crore investment is awaited from Maruti Suzuki India and Honda Cars India, taking the installed capacity to 2.2 mn vehicles annually in the next six to eight years.

A similar amount of investment has been readied by vendors of these companies. Around 100 of these have either set up facilities or are working on doing so. As for Gujarat, the CM said the government planned to take the share of automotive industries in its overall engineering output to 10 per cent by 2020, from a current 3.7 per cent.

Honda to invest Rs965 cr to expand capacity for cars, bikes

to Keita Muramatsu, president & chief executive, HMSI. “This investment will provide new opportunities for expansion of brand Honda in the largest twowheeler market of the world,” he said. “Honda is strengthening its Make in India resolve through steady and strategic investments with a long term objective of creating 39% additional capacity within 3.5 years.”

J

apanese auto manufacturer Honda Motor Co. will invest Rs.965 crore in its two-wheeler and car businesses in India as it looks to increase production capacity.

Modi launched the Make In India campaign in September to attract foreign companies to invest and manufacture in India and export to other countries after leading the National Democratic Alliance to victory in the April-May general election.

The plan is to increase manufacturing capacity by 600,000 units for twowheelers and by 60,000 units for cars by 2016, Honda’s local units said in two separate statements.

India has set for itself an ambitious target of increasing the contribution of manufacturing output to 25% of gross domestic product (GDP) by 2025, from 16% now.

While Honda Motorcycles & Scooters India (HMSI) will invest Rs.585 crore in its third two-wheeler production plant in the Narsapura area near Bengaluru, Honda Cars India Ltd (HCIL) will invest Rs.380 crore in its Tapukara plant in Rajasthan.

In 2014, industry-wide motorcycle sales in India increased to 16 million units, a year-on-year increase of 10%. In the same year, Honda motorcycle sales increased to 4.2 million units, a year-on-year increase of approximately 30%.

The expansion of the second plant will increase HCIL’s overall annual production capacity from the current 240,000 units to 300,000 units including the 120,000-unit capacity of its first plant in Greater Noida on the outskirts of New Delhi.

In 2014, sales of passenger vehicles in India increased to 2.55 million units, a year-on-year increase of some 3%. In the last 10 years, the market has grown around 2.5 times, making India the world’s sixth largest automobile market when sales of commercial vehicles are included.

HMSI’s annual production capacity will reach 6.4 million units, combined with that of its fourth plant, which is scheduled to become operational in the first half of 2016 in Gujarat. These investments will also require an additional workforce of 2,500 people, of which 1,900 will be employed by the two-wheeler maker. The fresh investments are intended to strengthen the company’s operations in India in deference to Prime Minister Narendra Modi’s Make in India campaign, according

Honda Cars said the new investments are driven by strong sales momentum for its cars. “India has emerged as a very important market for Honda and holds great potential for future growth as well,” it said in its statement. HCIL is the fastest growing automobile company in India with a 44% increase in its domestic sales during April 2014-Feb 2015 with 166,366 units from 115,913 units in the year-ago period. India Newsletter • 7


Embassy of India, Vienna

MAKE IN INDIA Summary ■■ 3rd largest producer in Asia. ■■ 3rd largest global producer of agro-chemicals. ■■ 6th largest producer of chemicals in the world. ■■ Total production of 19,300 Thousand Metric Tonnes in 2013-14. ■■ 70,000 commercial products. ■■ 16% of world dye production.

Reasons to Invest ■■ India is the third largest producer of chemicals in Asia and sixth by output, in the world. ■■ The chemicals industry is a key constituent ofthe Indian economy, accounting for about 2.11% of the nation’s GDP. ■■ India is currently the world’s third largest consumer of polymers and third largest producer of agrochemicals.

■■ Polymer demand is expected to grow by 8-10% with healthy growth in industries such as clothing,  automobiles etc.

■■ India’s proximity to the Middle East, the world’s source of petrochemical feedstock, makes for economies of scale.

Growth Drivers

■■ Strong government support for R&D. ■■ Polymers and agro-chemicals industries in India p  resent immense growth opportunities.

Statistics ■■ The estimated size of the market is USD 144 Billion. ■■ India accounts for approximately 16% of the world production of dyestuff and dye intermediates. ■■ Total production of the Indian chemicals industry was 19,308 Thousand Metric Tonnes in 2013-14. ■■ It is one of the most diversified sectors, covering more than 70,000 commercial products. ■■ Current production of polymers is around 9 Million Tonnes with imports  of around 2.8 Million Tonnes. 8 • India Newsletter

■■ A large population, dependence on agriculture, and strong export demand are key growth drivers for the industry. ■■ A global shift towards Asia as the world’s chemicals manufacturing hub. ■■ Per capita consumption of chemicals in India is lower as compared to western countries. ■■ Rise in GDP and purchasing power generates huge growth potential for the domestic market. ■■ A focus on new segments such as specialty and knowledge chemicals. ■■ Low-cost manufacturing. ■■ Skilled science professionals. ■■ World-class engineering strong R&D capabilities.

and

FDI Policy ■■ 100% FDI is allowed under the automatic route in the chemicals sector, subject to all the applicable

regulations and laws. ■■ Certain products such as wax candles, laundry soaps, safety matches, fireworks and incense sticks fall under items reserved for the MSME sector in which FDI beyond 24% is permitted under the government route

Sector Policy ■■ Industrial licensing has been abolished for most sub-sectors except f or certain hazardous chemicals. ■■ The government is continuously reducing the list of reserved chemical items for production in the smallscale sector, thereby facilitating greater investment in technology upgradation and modernisation. ■■ Policies have been initiated to set up integrated Petroleum, Chemicals and Petrochemicals Investment  Regions (PCPIR). ■■ PCPIR will be an investment region spread across 250 square kilometres for the manufacture of domestic and export-related products of petroleum, chemicals and petrochemicals.


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■■ Some of the strategies proposed between 2012-17 include: ■■ 1. Implementation of strategy for sourcing and allocation of feedstock. ■■ 2. Development of an innovation roadmap for chemicals sector and setting up of R&D fund under PPP model. ■■ 3. Focus on green and sustainable technologies and reducing the environmental impact of the sector. ■■ 4. Augmenting existing testing centres to act as certifying agencies for  testing plastic prodcuts and raw materials to meet BIS standards. ■■ 5. Establishing specialized vocational training centres in clusters  for the chemicals industry. ■■ 6. Formation of industrial clusters/plastic parks of world class quality

Financial Support ■■ PROVISIONS OF THE 2O14PROVISIONS OF THE 2O14-2O15 UNION BUDGET: ■■ Basic customs duty (BCD) on reformate is being reduced from 10% to 2.5%. ■■ Basic customs duty (BCD) on propane, ethane, ethylene, propylene, butadiene is being reduced from 5% to 2.5%. ■■ Basic customs duty (BCD) on ortho-xylene is being reduced from 5% to 2.5%. ■■ Basic customs duty (BCD) on denatured ethyl alcohol and methyl alcohol is being reduced from 7.5% to 5%. ■■ Basic customs duty (BCD) on crude naphthalene is being reduced from 10% to 5%. ■■ Basic customs duty (BCD) on fatty acids, crude palm stearin, RBD and other palm stearin and specified industrial grade crude oils is being reduced from 7.5% to nil for the manufacture of soaps and oleochemicals subject  to actual user conditions. ■■ Basic customs duty (BCD) is also

being reduced on crude glycerine from 12.5% to 7.5% in general and from 12.5% to nil for manufacture of soaps subject to actual user conditions. ■■ Any of the following two deductions can be availed: ■■ 1. Investment allowance (additional depreciation) at the rate of 15% to manufacturing companies that invest more than INR 1 Billion in plant and machinery acquired and  installed between 01.04.2013 and 31.03.2015 provided the aggregate amount of investment in new plants and machinery during the said period exceeds INR 1 Billion. ■■ 2. In order to provide a fillip to companies engaged in manufacturing the said benefit of additional deduction of 50% of the cost on new plant and machineries exceeding INR 250 Million, which is acquired and installed during any previous year ending up to 31.3.17. ■■ R&D INCENTIVES: ■■ Industry/private sponsored research programs – a weighted tax deduction is given under Section 35 (2AA) of the Income Tax Act. A weighted deduction of 200% is granted to assesses for any sums paid to a national laboratory, university or institute of technology, for specified persons with a specific direction, provided the said sum is used for scientific research within a program approved by the prescribed authority. ■■ COMPANIES ENGAGED IN MANUFACTURE HAVING AN INHOUSE R&D CENTRE: ■■ A weighted tax deduction of 200% under Section 35 (2AB) of the Income Tax Act for both capital and revenue expenditure incurred on scientific research and development. Expenditure on land and buildings are not eligible for deductions. ■■ STATE INCENTIVES: ■■ Apart from the above, each state in India offers additional incentives for industrial projects.

■■ Incentives are in areas like subsidised land cost and relaxation in stamp duty exemption on sale/ lease of land, power tariff incentives, concessional rate of interest on loans, investment subsidies/tax incentives, backward areas subsidies, special incentive packages for mega projects etc. ■■ EXPORT INCENTIVES: ■■ Export promotion capital goods scheme. ■■ Duty drawback scheme. ■■ Focus product scheme, special focus product scheme and focus market scheme. ■■ AREA BASED INCENTIVES: ■■ Incentives for units in SEZ/NIMZ as specified in respective Acts or setting up projects in special areas like the North-east, Jammu & Kashmir, Himachal Pradesh & Uttarakhand.

Investment Opportunities ■■ AGRO-CHEMICALS: ■■ India is the third largest producer of agro-chemicals globally. ■■ India exports about 50% of its current production and exports are likely to remain a key component of the industry. ■■ SPECIALTY CHEMICALS: ■■ The specialty chemicals market has witnessed a growth of 14% in the last five years; the market size is expected to reach USD 70 Billion by 2020. ■■ India is currently the world’s third largest consumer of polymers and growth in plastic demand will drive up consumption further. ■■ Growth drivers include a growing construction industry and adoption of advanced coating, ceiling and polymer-based reinforcing material in construction as well as plastics, paints and coatings for the automotive sector. ■■ COLOURANT CHEMICALS: ■■ The Indian colourant industry is valued at USD 6.8 Billion, w  ith exports accounting for nearly 75%. ■■ India accounts for 16% of global industry share and this figure is India Newsletter • 9


Embassy of India, Vienna

expected to further increase. ■■ Other segments include petrochemicals, bio-pharma, bioagri, and bio-industrial products.

Foreign Investors ■■ Mitsubishi Chemical Corporation (Japan) ■■ BASF (Germany) ■■ ADEKA (Japan) ■■ Akzo Nobel (Netherlands) ■■ DuPont (USA)

■■ Syngenta (Switzerland)

Chemicals & Fertilizers

■■ Croda (UK)

■■ Indian Chemical Council

■■ DyStar (Germany)

■■ Crop life India

■■ Henkel (Germany)

■■ Dye Manufacturers Association of India

■■ Dow Chemicals (USA) ■■ Rhodia (Belgium) ■■ Wacker Metroark (Germany)

Agencies for Contact

■■ Alkali Manufacturers Association of India ■■ Indian Speciality Chemical Manufacturers Association

■■ Department of Chemicals ■■ Chemicals & Petrochemicals & Petrochemicals, Ministry  of Manufacturers Association

INDIAN EMBASSY LIBRARY EMBASSY’S LIBRARY ■■ The Embassy’s library is opened daily from 10am to 1pm without appointment. ■■ Our collection contains more than 2000 titles in dozens of categories. ■■ For scheduling an appointment outside the opening hours or to inquiry on a book or topic of interest in our collection, please contact the information assistant under infoasstt@ indianembassy.at or 01 505 8666 33 ■■ Download our latest catalog of books under http://indianembassy.at/pdf/ EmbassyLibrary.pdf

INDIA PERSPECTIVES MAGAZINE ONLINE

www.magzter.com/publishers/meaindia

10 • India Newsletter


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PERSPECTIVES ON INDIA Smart cities: An Opportunity for real estate sector by Samir Chopra, Founder & CEO, RE/MAX India. In line with several other initiatives in making India take a major leap in the race of development at a global level, the building of Smart Cities is definitely a rational decision taken by the Indian government towards its execution. As a matter of fact, India is the seventh largest country by area and as per the current statistics, we have also become one of the fastest growing economies & are looked up as the newly Industrialised country in the world. There is surely a huge potential for the development of Smart Cities but the question is on how will this be strategized and executed. There are a number of questions that arise with reference to the execution of this plan as the residents of the cities in India have already been facing a number of problems due to low maintenance and poor planning. The smart cities will not only make life simpler and much more comfortable to its residents but also will help us in efficiently utilizing our resources and give a next-level infrastructure to our future generations. With the usage of information and communication technologies to develop more organized public services, it is also a big opportunity for the Real Estate sector as it is a very good investment for the investors with a long-term vision. One factor behind the need for smart cities is the international call for action in response to changes in the global and urban environments. There are problems like resource depletion, urban issues, and other difficulties brought about by climate change and increases in the size and concentration of population. Smart cities intended to boost long-term economic growth and global competitiveness over the next 10 years and with a significant share of investments coming from foreign governments and private

sector inflows, the dream will definitely become a reality. The potential economic impact from the development of India’s smart cities will act as a significant catalyst for economic growth through a number of drivers, including increased foreign direct investment (FDI), accelerated development of Real Estate Investment Trusts (REITs), increased competitiveness and job creation. Not only will investment into sectors like roads, airports and smart cities create a better and a next level infrastructure, but it will also generate private equity investment opportunities into the core sectors. Though it a very challenging concept especially in India because of the existing socio-economic conditions but an effective leadership and an optimum utilization of the resources by the players in each sector involved in this concept can deliver the smart infrastructure. All individuals at every level starting from the investors to the executors have to be actively involved in the multiple operational and the infrastructural developments. Urbanization in India has significant implications for the future development of the country and the coming generations will exert tremendous pressure on urban infrastructure and services. It is, therefore, imperative that we find innovative solutions for the urban challenges of growth and sustainability. Additionally, green growth strategies can build environmentally sustainable cities. Though the concept of smart cities is relatively new in India and it is an ambitious plan to upgrade urban India but together we are well on the path to creating them.The government has planned to set up the concept of smart cities in Andhra Pradesh, Assam, Bihar, Gujarat, Haryana, Himachal Pradesh, Jharkhand, Karnataka, Kerala, Maharashtra, Manipur, Odisha, Punjab, Rajasthan, Sikkim, Tamil Nadu, Pondicherry, Terengganu, UP, Uttrakhand and West Bengal. We

at RE/MAX India are positive about the whole concept and are sure that with such concepts, the projected development of India by 2020 will be achieved.

Foreign Trade Policy 2015-20 sets out visionary agenda by Ravi Capoor, IAS, CEO, IBEF India. Laying a strong roadmap for the future under the Foreign Trade Policy 2015-20, the Government of India has targeted merchandise and services exports of US$ 900 billion by 2019-20 from US$ 465.9 billion in 2013-14, thereby raising India’s share in global exports from 2 per cent to 3.5 per cent. The policy aims to link rules, procedures and incentives for exports and imports with other government initiatives like Make in India, Digital India and Skills India to create an Export Promotion Mission. Focus sectors have been identified for their strengths and potential and the government will also look at ways to bolster trade engagements to enable better export diversification. The policy notably looks to enable greater participation from governments across states and union territories towards promotion of exports. A number of initiatives have been taken by the Central Government to promote exports. Primary among them is the merging of several export promotion schemes into two schemes – Merchandise Exports from India Scheme (MEIS) and Services Exports from India Scheme (SEIS). There will be no conditionality attached to any of the scrips issued under these schemes. Also the duty credit scrips issued under these schemes and the goods imported against them will be completely transferable. The benefits of these schemes have also been extended to units situated in Special Economic Zones (SEZs). The FTP has also reduced Export Obligation (EO) by 25 per cent for procurement of capital goods from domestic manufacturers. MEIS will provide greater benefits India Newsletter • 11


Embassy of India, Vienna

to exported products with higher domestic content and value addition. Notably, goods exported under the categories of handloom products, books/periodicals, leather footwear, toys and customised fashion garments with FOB values of up to Rs 25,000 per consignment by leveraging the e-commerce platform will be eligible for FTP benefits. The policy document recognises the services sector as an area of high potential. India’s share of global services exports rose from 0.6 per cent in 1990 to 1 per cent in 2000 and 3.3 per cent in 2013, growing much faster than the country’s share in global merchandise exports. SEIS will apply to service providers that are located in India as opposed to Indian service providers. The rate of incentive under the scheme will be based on the net foreign exchange earned. Efforts will be taken to provide market access through Comprehensive Economic Partnership Agreements (CEPAs) with target markets and a Global Exhibition on Services will be held annually to promote India’s strengths and dynamism in the services sector. A two tier branding strategy is also being worked out, which will be carried out by the India Brand Equity Foundation (IBEF). The first objective is to identify and clearly articulate the elements that are core to the Brand India positioning and then clearly communicate them in target markets through a 360 degree marketing campaign. At the second level, the government will endeavour to promote those brands from India that have the potential to become or have already emerged as global brands. Sector specific brand campaigns are being planned for sectors like services, pharmaceuticals, plantations and engineering as well as for products and services that represent India’s traditional strengths like handicrafts and yoga. Going broadly in line with the WTO norms that require gradual phasing out of subsidies, the Government of India is committed to enable 12 • India Newsletter

fundamental improvements in India’s export competitiveness and also ensure greater market access. This forward looking approach is the cornerstone of the newly announced FTP, which promises a renewed momentum in India’s export performance in the coming years.

It is Make in India at Hannover Messe 2015 by Ravi Capoor, IAS, CEO, IBEF India. India has registered its presence at the Hannover Messe, one of the largest industrial technology fairs across the world. The Fair took place from April 13-17, 2015, and had India as the Partner Country for the 2015 edition. With Make in India being the central theme for India’s participation, the Department of Industrial Policy and Promotion (DIPP) projected India’s brand image by incorporating many of the key core sectors of the Indian economy in the central theme pavilion. The Fair was jointly inaugurated by Mr Narendra Modi, Hon’ble Prime Minister of India and Dr Angela Merkel, Hon’ble Chancellor of the Federal Republic of Germany. It is noteworthy that Hannover Messe attracts close to two lakh global leaders in business, technology, industrial scientists and policy makers each year. India was set to leverage the status of Partner Country in the upcoming edition. With EEPC India as

the lead agency and Confederation of Indian Industry (CII), Federation of Indian Chambers of Commerce and Industry (FICCI) and India Brand Equity Foundation (IBEF) as the supporting partners, over 300 Indian companies participated as exhibitors in the various sectors in Hannover Messe. In addition, over 100 CEOs of top companies confirmed their participation in the Hannover Messe 2015. The Make in India programme of the Government of India was extensively publicised at the Hannover Airport, city and the fairgrounds during Hannover Messe 2015. In addition to creating a central theme pavilion in Hall 6 at Hannover Messe, India also organised the Indo-German Business Summit and sectoral seminars on topics like electronics and electricals, Smart Cities - the Urban Challenge, Renewable Energy, Skill India, Heavy Engineering & Motion Drive and Automation and Digital India. In addition, Maharashtra, Andhra Pradesh, Punjab, Gujarat, Rajasthan and UP hosted investments seminars during the fair. In total, 12 State Governments participated at the Hannover Messe 2015. The participation as Partner Country at Hannover Messe 2015 provided a boost to India’s engineering exports and at the same time, attracted investments into India as part of the Make in India campaign.


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INDIAN TRADE FAIRS INTERESTED IN VISITING A TRADE SHOW IN INDIA? In case your company is interested in visiting a tradeshow/B2B event in India, be it one listed here or another one that came to your attention, get in contact with us via marketingofficer@indianembassy.at to get more information about possible assistance/subsidies.

India Newsletter • 13


Embassy of India, Vienna

INVEST INDIA Federation House, Tansen Marg New Delhi—110 001 0091-11-23765085, 23487278 investindia@ficci.com www.investindia.gov.in

I

nvest India is the country’s official agency dedicated to investment promotion and facilitation. Set up as a joint venture between FICCI (51% equity), DIPP (35% equity held by the Department of Industrial

14 • India Newsletter

policy and Promotion, Ministry of Commerce & Industry) and State Governments of India (0.5% each), its mandate is to become the first reference point for the global investment community. It provides granulated, sectorspecific and state-specific information to a foreign investor, assists in expediting regulatory approvals, and offers hand-holding services. Its mandate also includes assisting Indian investors make informed choices about investment opportunities overseas.


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INTERNATIONAL EVENTS

SPIC MACAY a voluntary movement that organizes events of classical music, dance and art forms in educational institutions throughout the world. SPIC MACAY is committed to promoting an appreciation of Indian culture by rendering programmes of Indian classical music and dance, folk, poetry, theatre, traditional paintings, crafts & yog primarily in schools and colleges. SPIC MACAY is organising its 3rd International Convention at the Indian Institute of Technology - Bombay (IIT-B) in Mumbai from 31st May to 6th June 2015, where about 1800 participants will gather from all over the country and abroad to rededicate themselves to this voluntary movement. At this weeklong event, over 300 artistes would be participating from different parts of the country. There would be performances of classical music & dance, folk, theatre and talks by several inspiring and eminent artists. We would also be having intensives and workshops conducted by inspiring gurus and master craftsmen. National Conventions are the congregation of the people associated with this Noble Cause, who spend one week in a unique ashram-like atmosphere. The Annual Convention is a unique experience where participants get to witness great

artists performing classical music & dance, folk and theatre. Several intensives and workshops are organized where the participants learn the form from the inspiring gurus (inspiring Masters) for 5 days. The day starts at 4 am where the participants do the naad yog followed by hatha yog. Crafts village is one special feature of the convention where Master craftsmen sensitise the participants about various crafts for 5 days. Screenings of cinema classics include the great works be legendary film-makers like Akira Kurosawa, Satyajit Ray, Charlie Chaplin, Ingmar Bergman, Shyam Benegal, etc. Several talks by inspiring people and panel discussions are organized. The convention culminates with an over-night series of concerts. The performances at this convention will include Kishori Amonkar ( vocal ), Dr L Subramanyam (violin), Girija Devi (vocal), Shiv Kumar Sharma (santoor), Shankaranarayan ( Carnatic Vocal) and others The Conventions have been organized in different cities of the country every year. The lodging and boarding is arranged by SPIC MACAY for the participants without any costs. Participants will need to find their own travel costs. For online registrations and further details, please visit www.spicmacay.com India Newsletter • 15


Embassy of India, Vienna

TOURISM Avian Concerns Kokkarebellur by Hugh & Colleen Gantzer.

W

e heard them long before we saw them. Driving in from Karnataka’s Bheemeshwari, we passed villages with stands of mulberry and silkworm farms, interspersed with lush fields of rice and sugarcane. This district is called „The Land of Sugar” and so, at first, we thought that activists were agitating either for or against the price of cane. It had a „rent-a-crowd” quality about it As we got closer, however, the collective sound shredded itself into cheeps, squawks and guttural honks. Then we spotted them: soaring, swooping, dots in the sky, circling and landing and rising around a spot hidden in a mass of trees. We’ve seen this happening above landfills around major cities but there were no urban centres in this green and very rural region. Our guide said “We’re coming to Kokkare Bellur” The name of the village captures its uniqueness. Kokkare Bellur, according to one of the many interpretations given to us later, could mean The Place of the Water Birds. That’s very apt. To our delight, we discovered that this beautiful little village was home to an incredible host of nesting pelicans and storks, cormorants, herons and even a pair of black ibis though there might have been more of these sacred waders on the outer fringes of the village. . All the birds had built huge untidy nests on the trees shading the cottages. Most of the nests carried crèches of shrieking chicks, more demanding than the best professional agitators. Yet, in spite of the avian cacophony, the people of the village seemed unperturbed. A young man cycled past carrying a long fishing rod, a housewife spread grain to dry and then covered it with a net, a senior citizen read a newspaper on his verandah, a furry grey cat

16 • India Newsletter

lay curled on a chair, all its ends tucked in contentedly. Clearly, they had got used to the all-pervasive chorale, the faint fishy-phosphorus odour, and the constant splatter of detritus from the flocks on the trees above them We picked a drizzle-free spot and drew up next to a small, fenced off, grove. Inside, there were stone benches and tables speckled with bird-lime, and two hut-sized piles of straw on which pelicans waddled like corpulent counsellors, and long-legged storks stood regarding us with cold curiosity It was a most unusual place in a most extraordinary village. As we were looking over the fence, a grizzle haired man walked up and introduced himself to us as Linge Gowda. He said, in a soft-spoken and very matter-of-fact way, that this enclosure was an infirmary for abandoned fledglings. He opened the gate and we followed him in with three boys trailing behind. One of the boys picked up a fish from a metal bowl and threw it to a pelican. It caught it deftly in its ungainly beak and then, on second thoughts, dropped it. “Not fresh” explained Linge Gowda. “It has a broken wing so it cannot forage for itself, but still it eats only fresh fish!” He pointed out another bird, blind in one eye. “When they are fit they fly away

but, for some time, they return here. Then, when they build their own nests in our village, they do not ask to be fed” The differently-enabled pelicans groomed themselves. . Gowda said he was a farmer. “The birds are like our children” he explained. “My people prayed at the temple of Bhairaveshwari, gave a gift to the idol and asked for the birds to be sent to our trees. The birds arrived.” “Why did they ask for the birds?” we queried. “Do the birds keep your fields free from pests?” He shook his head. “No. Nothing like that.” Then he added, “It is said that long ago, a European visited our village and said that the birds were present even then. In 1914 – 1917, when a plague struck the village, the people moved out. The birds followed. When our people returned, so did the birds” That was odd. What did the birds give back to the village for sheltering and feeding them? What was the symbiotic relationship in this intriguing place? In Malaysia we had noticed apertures in the walls of modern concrete structures. They had been made to encourage swifts to build their saliva-bound nests. . Birds’ Nest soup is a delicacy. Then, in Egypt we had seen conical, towers honey-combed with holes. These were wild-pigeon farms where fledgling squabs were selectively


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harvested for their reputedly rejuvenating flesh. But the pelicans and their fellow residents were, clearly, not being harvested by the people of Kokkare Bellur. Possibly, then, they played a socio-spiritual role. In Medieval, Christian, lore the pelican was regarded as a symbol of Jesus. Its ability to regurgitate food for its chicks was misinterpreted as its self-sacrificing passion to nurture its progeny on its own blood. A memory of what we had seen in Nepal, surfaced. There, we had noticed little holes let into the walls of village huts. These had been created for sparrows. The rural folk

of Nepal believed that when they died, sparrows would carry their souls up to heaven. People, living close to nature, had found a reason to respect the intricate web of life. Could this instinctive sensitivity explain the wonder of Kokkare Bellur? Linge Gowda, however, did not elaborate. He handed us a well produced pamphlet created by the Mysore Amateur Naturalists. It said We depend entirely on the generosity of people like you to sustain our project. .. we have to purchase large quantities of fish,

every day, during the breeding season, to feed the orphan chicks…” We offered him a donation. He smiled and shook his head. “No, we don’t want to take money from visitors. When money enters, trouble starts!” Possibly. Or, perhaps, they accepted the old folk belief that good deeds earn cumulative social benefits if they are not rewarded in cash. Whatever the reason, it certainly seemed enough to cause a vociferous collective cacophony in the crowded groves of Kokkare Bellur.

India Newsletter • 17


Embassy of India, Vienna

REPORT ON PAST EVENTS Make in India: Starting in Vienna With the aim of bringing Austrian and Indian business people together to strengthen the bonds linking Vienna/Austria and India, the Embassy of India, in cooperation with the Vienna Business Agency, welcomed several guests in the context of the „Make in India: Starting in Vienna“ event held at the

18 • India Newsletter

Vienna Expat Center on April 8th, 2015. The event counted with a presentation on the “Make in India” Campaign and the most important business prospects for India-Austria cooperation by H.E. Rajiva Misra, Ambassador of India to Austria as well as a “Business Location Vienna” by Ms. Sabine Ohler, Head of International Services at the Vienna Business Agency. The event was

sponsored by the Austrian Anadi Bank, former Austrian subsidiary of Hypo Alpe-Adria-Bank International AG, which is now owned by BritishIndian businessman Dr. Sanjeev Kanoria. Anadi Bank’s CEO, Dr. Martin Czurda, also made a presentation on Anadi Bank’s banking services connecting and facilitating IndiaAustria business relations. Some impressions of the event:


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INDIAN MOVIE EVENING AT THE EMBASSY Due to limited capacity, seats will be given on a first come, first served basis. Therefore, you are highly encouraged to reserve your seats online at www.indianembassy.at, via email under marketingofficer@ indianembassy.at

Yeh Jawaani Hai Deewani “Lass Dein Glück nicht ziehen” ■■ Synopsis: Yeh Jawaani Hai Deewani is the story of the relationship between two characters, Bunny (Ranbir Kapoor) & Naina (Deepika Padukone), at two separate but defining times in their lives... first, when they are just out of college and standing on the crossroads of multiple decisions that will shape who and what they become... and then later on, in their late-twenties when they meet again, holding on to certain fulfilled and certain unfulfilled dreams, at a crossroads of another nature this time... how these two characters affect, change, befriend and eventually fall in love with each other is the journey the film aspires to take us on... ■■ Genre: Musical/Drama/Romance ■■ Directed by: Ayan Mukherjee ■■ Starring: Ranbir Kapoor, Deepika Padukone, Aditya Roy Kapoor ■■ Released: 2013 ■■ Duration: 160 Minutes ■■ Language: Hindi ■■ Subtitles: German ■■ Image Quality: HD

Showtime April 27th, 17:30 Indian Embassy Business Centre (1st Floor, Kärntner Ring 2, 1010 Vienna) India Newsletter • 19


Embassy of India, Vienna

INDIAN EVENTS IN AUSTRIA The Mahabharata

play will be performed in German.

Everyone in India knows this great epic by heart but the rest of the world seems to be quite ignorant about it. Many people here in Austria don’t know the story and often have never even heard about it.

Two actors are going to embody all the main characters of the story in rapid changes of scenes and with powerful virtuosity – all within 99 minutes. They are going to build a bridge between the ancient culture and the world of today, between the deep spirituality of India and the philosophical questions of the West. And they are going to prove that drama can be funny sometimes as well.

Theater 7, a group of professional stage-artists, would like to change that. The Mahabharata is not only an essential part of India´s cultural heritage, but it is also an important part of art and culture of the world world heritage. Theater 7 is producing a version of the Mahabharata for an audience from the age of 15 and above. The

■■ The Team Concept, Skript: Tilmann Schillinger, Vanessa Payer Kumar Director,

Supervisor:

Anselm

Lipgens Stage: Gunter Thurner Costumes: Marianne Schulz Music: Emanuel Schulz Actors: Vanessa Payer Kumar, Helmut Schuster ■■ Where Dschungel- Theaterhaus für junges Publikum ■■ When 16th of April 7.30pm 17th of April 10.15am 7.30pm 18th of April 7.30pm ■■ More Information www.mahabharata.at

Seminar by Ms. Shakiri Juen - “Von Göttern, fliegenden Helden und Yogis... Heilige Wissen, sagenhafte Geschichten, Weltbild und Religionen Indiens” Date: 4.5., 11.5., 18.5., 1.6., 8.6., 15.6., 22.6., 29.6. Time: in each case 19.00 – 21.00 Place: Govinda (Lindengasse 2 a, 1070 Wien) For detailed informations please visit: http://www.govinda.at/events.php 20 • India Newsletter

India newsletter 04 2015  
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