INDIA NEWSLETTER Indian Embassy, Vienna
Published by the Embassy of India, Vienna Year 6 • Issue 67 • July 2016
MAKE IN INDIA ■■PORTS AND SHIPPING
India Newsletter • 1
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The Digital India programme is a flagship programme of the Government of India with a vision to transform India into a digitally empowered society and knowledge economy Digital Infrastructure as a Core Utility to Every Citizen
Governance and Services on Demand
Digital Empowerment of Citizens
www.digitalindia.gov.in 2 â€˘ India Newsletter
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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 India Newsletter • 3
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Prime Minister Narendra Modi had announced the ‘Startup India, Standup India’ initiative in his Independence Day address last year. Last January 16th, PM Modi unveiled the action plan for startups in the country. He announced a self-certification scheme in respect of nine labour and environment laws and said there will be no inspection during the first three years of launch of the venture. Addressing the first conference of start-up entrepreneurs, Modi announced an action plan to boost such ventures which are seen as key to employment generation and wealth creation. Around 40 top CEOs and startup founders and investors from Silicon Valley attended the event. Here are the top takeaways from the prime minister’s speech.
■■ 1. Compliance regime based on self certification The objective of compliance regime based on self certification is to reduce the regulatory burden on startups. This self-certification will apply to laws like payment of gratuity, contract labour, employees provident fund, water and air pollution acts. ■■ 2. Startup India hub A startup India hub will be created as a single point of contact for the entire startup ecosystem to enable knowledge exchange and access to funding. ■■ 3. Simplifying the startup process A startup will be to able to set up by just filling up a short form through a mobile app and online portal. A mobile app will be launched on April 1 through which startups can be registered in a day. There will also be 4 • India Newsletter
a portal for clearances, approvals and registrations
■■ 4. Patent protection The government is also working on a legal support for fast-tracking patent examination at lower costs. It will promote awareness and adoption of Intellectual Property Rights (IPRs) by startups and help them protect and commercialise IPRs. ■■ 5. Funds of funds with a corpus of Rs 10,000 crore In order to provide funding support to startups, the government will set up a fund with an initial corpus of Rs 2,500 crore and a total corpus of Rs 10,000 crore over four years. The fund would be managed by private professionals drawn from the industry while LIC will be a co-investor in the fund. The credit guarantee fund for start-ups would help flow of venture debt from the banking system to start-ups by standing guarantee against risks. ■■ 6. Credit Guarantee Fund A National Credit Guarantee Trust Company is being envisaged with a budgetary allocation of Rs 500 crore per year for the next four years. ■■ 7. Exemption from Capital Gains Tax Currently, investments by venture capital funds in startups are exempt from this law. Now, the same is being extended to investments made by incubators in startups. ■■ 8. Tax exemption for startups Income tax exemption to startups announced for three years ■■ 9. Tax exemption on investments above Fair Market Value
■■ 10. Startup fests Innovation core programs for students in 5 lakh schools. There will also be an annual incubator grand challenge to create world class incubators ■■ 11. Launch of Atal Innovation Mission Atal Innovation Mission started to give an impetus to innovation and encourage the talent among the people ■■ 12. Setting up of 35 new incubators in institutions PPP model being considered for 35 new incubators, 31 innovation centres at national institutes ■■ 13. Setting up of 7 new research parks Government shall set up seven new research parks - six in IITs, one in IISc with an initial investment of Rs 100 crore each. ■■ 14. Promote entrepreneurship in biotechnology Five new bio clusters, 50 new bio incubators, 150 technology transfer offices and 20 bio connect offices will be established. ■■ 15. Innovation focused programmes for students There will be innovation core programs for students in 5 lakh schools. ■■ 16. Panel of facilitators to provide legal support and assist in filing of patent application ■■ 17. 80 per cent rebate on filing patent applications by startups ■■ 18. Relaxed norms of public procurement for startups ■■ 19. Faster exits for startups
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India’s first Centre of Excellence for Internet of Things (CoEIoT) has been launched in Bengaluru with five startups, which will provide demonstration and concept labs for building IoT solutions for applications like agriculture, automobile, telecommunications, healthcare and consumer goods.
India has become the fourth largest mobile application economy in the world based on total app downloads per year.
The Financial Stability and Development Council (FSDC) reviewed the situation developing from Britain’s exit from the European Union, and concluded that India is well prepared to face global developments, on back of improved macroeconomic fundamentals, large reserves and accelerated financial sector reforms, which can counter market volatility.
The Jawaharlal Nehru Port (JNPT) has become the first port in the country to implement logistics data tagging of containers, which will help importers and exporters track their goods in transit through logistics data bank service.
Power generation growth in India stood at 9.5 per cent in 2016 so far, as compared to 7.0 per cent growth recorded from 2014 to 2016.
Foreign Portfolio Investor (FPI) net inflows into the Indian stock market stood at Rs 3,700 crore (US$ 556 million) in June 2016.
The State Bank of India (SBI) has signed an agreement with The World Bank for a Rs 4,200 crore (US$ 625 million) credit facility, aimed at financing grid connected rooftop solar photovoltaic (GRPV) projects in India.
Total number of domestic tourist visits to the States/UTs grew by 11.63 per cent year-onyear to 1,432 million, while foreign tourist visits (FTVs) grew by 4.4 per cent year-onyear to 23.3 million in 2015.
Xiaomi, world’s third largest smartphone maker, has approached state governments in India to set up handset plants in collaboration with Chinese contract manufacturer Foxconn, in order to boost their production to keep pace with the rising demand.
The Ministry of Skill Development & Entrepreneurship (MSDE) and the Ministry of External Affairs (MEA) have signed a Memorandum of Understanding (MoU) for implementation of the Pravasi Kaushal Vikas Yojana (PKVY) which aims at training and certification of Indian workforce keen on overseas employment in select sectors and job roles, in line with international standards
India has jumped 19 places to rank 35th in World Bank’s Logistics Performance Index 2016, which is computed from the survey responses of about 1,051 logistics industry professionals to analyse countries based on international supply chain efficiency.
The Indian telecommunication services market is expected to grow by 10.3 per cent yearon-year to reach US$ 103.9 billion by 2020, according to a report by leading research firm Market Research Store.
Mergers and acquisitions (M&A) deal value in India’s power sector increased by one and half times to US$ 1.6 billion across 17 deals between January to May 2016. India Newsletter • 5
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IMPORTANT ANNOUNCEMENT FOR AUSTRIAN CITIZENS e-Tourist Visa (e-TV) for Austrian citizens The Government of India has extended e-Tourist Visa (e-TV) scheme to the citizens of Austria w.e.f. 26th February 2016. Under e-Tourist Visa scheme, citizens of Austria may now apply online (https:// indianvisaonline.gov.in/visa/tvoa. html) four days in advance to obtain the Electronic Travel Authorisation for travelling to India.This facility is in addition to the existing Visa services. This facility is also available to the citizens of Montenegro as well.Queries related to e-TV; for any assistance call 24x7 Visa support centre at +91-11-24300666 or send email to email@example.com.
INDIA-AUSTRIA NEWS ARTICLES Indian Minister of Railways in visit to Austria The Indian Minister of Railways, Shri Suresh Prabhu paid a visit to Austria on July 5th, 2016.
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In an event organized by the WKO Austria at their premises, H.E. Mr. Prabhu met with Mr. Richard Schenz, Vice President of the Austrian Federal Economic Chamber and Mr.
Rajiva Misra, Ambassador of India to Austria as well as CEOs of Austrian Railway Companies discuss possible further India-Austria cooperations in the field of railways technology.
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2nd International Day of Yoga Celebrations in Vienna The celebrations of the 2nd International Day of Yoga took place at the United Nations Office in Vienna (UNOV) on 21st June, 2016. Officials at the United Nations Office in
Vienna, Permanent Representatives and the UN staff participated in the yoga session held at this occasion. Permanent Representative of India, Ambassador Rajiva Misra read out the message of the Hon’b’e Prime Minister of India. Deputy Director General of the United Nations Office
The celebrations of the 2nd also took place on 19th June at Stadtpark. Yoga enthusiasts, Indian community
members, and yoga schools in Vienna participated in the yoga session at the Stadtpark, Vienna.
in Vienna read out the message from the Director General of the UNOV. The Vienna International Centre Yoga club and the Vienna International Centre Indian club also participated in the event. The event was followed by a reception.
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AUSTRIA IN INDIA Austrian s::can win data supply contract for Indian Clean Ganga Project Due to fast population growth, migration and industrialization, the pollution of the Ganges river has become a major issue for India and one of the biggest environmental challenges on earth. The Ganges river is a holy river and a goddess according to Hindu religion, and it is a major concern for every Hindu to reanimate and keep it alive. To clean the river is not only a big technical challenge, but also of enormous cultural and spiritual importance. Therefore, the “National Mission for Clean Ganga” was born in 2011 by the Indian government sup-ported by religious leaders, to fight the pollution and try to revive the river and its surroundings. The World Bank is supporting the “National Ganga River Basin Project”, which includes the construction of waste water collection systems and treatment plants to reduce the discharge of waste water with a total amount of $1 billion. On April 7th, a 5 years water quality data supply contract was appointed to the Austrian company s::can by the Central Pollu-tion Control Board (CPCB), the government authority in charge. The 36 monitoring stations will be de-signed, installed and operated by s::can Messtechnik GmbH in close co-operation with
the local In¬dian part¬ner, Aaxis Nano. The meas¬uring stations will continuously send real time water quality data to the Central Pollution Control Board in New Delhi. The collected information will strengthen the reg¬ulation and oversight of the river’s pollution load by helping planners better understand the origins of pollu¬tion, as well as to assess the impact of treatment on the water’s quality. Since 2013, 13 s::can online monitoring stations have already proven to deliver valid data from the Ganges river and tributaries, and, also due to our partner Aaxis’ great efforts, are close to 100% op-erational, extremely reliable, and tolerant to the extreme environmental conditions in India. The new contract is only a first phase of an even larger program to acquire reliable water quality data along the Ganges, and other Indian rivers, and will be a global reference. First of all, s::can is proud to be part of this big national effort, and will contribute to the cleaning of the Ganges with know-how, technology, heart and soul. But this project is also an important step to further strengthen s::cans’ position as the market leader in India, and global technology leader in online water quality monitoring. s::can’s patented core method, online UV-Vis-spectrometry, has
become a standard by law in India – for manifold reasons, but finally the match-winning criteria was the perfect combination of reliability, accuracy, and affordability.
Austrian Company Lyoness starts operations in India The Austrian company Lyoness, the head of a global loyalty rewards program dedicated to providing a rewarding and mutually beneficial relationship between their community of international shoppers and merchants, is now available in India. With its India market-entry, Lyoness is now active in 47 countries with approximately 1.000 employees worldwide. “Cash back with every purchase” is the Lyoness motto. With thousands of local, regional and international merchants and millions of members worldwide, Lyoness has become the premiere global shopping community and loyalty program! Shoppers enjoy multiple ways to shop and earn cash back – online, in-store with their Lyoness Cashback Card and with merchant gift cards. The Lyoness loyalty program is built on creating lasting relationships that benefit the merchants and members. As the shopping community grows, the merchants receive more sales, and in turn, they can provide increased rewards. In India Lyoness already startet with online shops and the company plans to follow their expansion with the small and medium enterprises. Lyoness India is fully operational and Indian entrepreneurs are invited to start taking advantage of their worldwide loyalty community. For more information please visit http:// www.mylyconet.com/walterkrug/ DE-AT/your-endless-possibilities or Phone: +436765186090
8 • India Newsletter
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NEWS ARTICLES India eyes place in top 100 on ease of doing business list India hopes to figure among the top 100 nations in the ease of doing business ranking, counting on significant improvement achieved by Delhi and Mumbai as well as additional measures likely to be taken by the time the World Bank announces the next list in October. Officials said the government is hoping that India will improve its position from 130 out of 189 nations at present to within the top 100 this year and the top 50 next year. The ranking considers business environment in Delhi and Mumbai. According to a report released by the Department of Industrial Policy and Promotion (DIPP), the two cities have undertaken reforms in areas such as construction permits, enforcing contracts and starting business. Some of the measures ahead include amendment to the arbitration and conciliation law to reduce the time spent in proceedings and grounds on which an award may be challenged. The insolvency and bankruptcy code bill passed in Parliament is also expected to become functional soon, making it easier to wind up businesses in India. To improve construction permits, Mumbai and Delhi have completed the process of singlewindow approval by integrating with internal departments and introduced digital signing of building permit application as well as maps. The manual application for grant of construction permits has been discontinued. The urban development ministry and Delhi Development Authority have notified the unified building bylaws. Besides, environmental clearance has been waived for 36 white industries, industrial sheds and educational institutions, and the
overall validity extended from five to seven years. Speeding up processes for starting a business, the corporate affairs ministry has introduced one form, INC 29, and one payment for businesses to avail three preregistration services including name availability, director identification number and incorporation of company. The DIPP report said to improve India’s performance on the parameter of businesses getting credit, SARFAESI (Central Registry) Rules, 2011 have been amended to record security interest created on all types of property such as movable, immovable and intangible.
India is world’s fourthlargest app economy India is rapidly moving into the mobile app age and is already the fourth-largest mobile app economy. The amount of time Indians spend on apps has also increased dramatically, says mobile-app analytics company App Annie. In total app downloads per year, only China, US, and Brazil are ahead of India. The annual figure for India is projected to grow by 92% to reach 7.7 billion downloads this year, and further to 20.1 billion by 2020. China’s app download is expected to grow at a much slower 29% this year, but the absolute figure will be more than 6 times that of India’s at 49 billion. “With the introduction of affordable smartphones and better infrastructure supporting mobile , and given India’s population, the growth here is expected to be significant,” Junde Yu, MD of App Annie APAC, said. He said the most important thing that is now driving the app economy here is not the number of downloads or the revenue but just the amount of time spent by users on the mobile app. The amount of time Indians spent on apps in the first quarter of 2016
more than doubled compared to that in the first quarter of 2014. In retail apps, the time spent grew by 11.5 times during the same period, driven by e-commerce majors likeFlipkart-Myntra , Amazon, and Snapdeal. The time spent on video streaming apps grew by 7.4 times, with YouTube and Hotstar leading the way. Speaking to TOI, Yu said, “People have this perception in India that users spend more time on browsers. That is not true. Our data shows that the percentage of time spent on apps in India is the same as around the world, at 93% (the remaining 7% comes from mobile browsers).” App Annie finds that over 25% of Android users in India use at least one ride-sharing app (those like Ola and Uber). This figure was the highest among all countries - in the US, UK, and Brazil, it is below 20%. “This was a little surprising. But I think India is a developing country so the users are finding the need to use these transport services more,” Yu said. Among ride-sharing apps, Ola is the most used and downloaded app, followed by Uber
India and Britain look to create bilateral trade pact India and Britain are evaluating the possibility of a free trade agreement (FTA) to guide bilateral trade after Britain officially leaves the European Union. Britain has actively sought to redraw economic ties with the world after a referendum last month went in favour of the country leaving the EU. UK business secretary Sajid Javid was in India on Friday to start initial discussions in this regard. “We already have a strong trading relationship with India and we hope to build on that,” he told the media on Friday after meeting Commerce and Industry minister Nirmala Sitharaman. Sitharaman said India would soon India Newsletter • 9
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start preliminary talks with Britain regarding the possibility of a bilateral trade deal that will kick in once Britain formally leaves the EU. This informal process would start moving once chief negotiators from Britain come to Delhi, she added. However, Sitharaman said with Britain moving out of the EU, ongoing negotiations over the proposed India-EU FTA would have to be restarted. The talks had been stuck in recent times over the referendum in support of Brexit. Javid, expected to meet with Finance Minister Arun Jaitley, will over the coming months conduct talks with US, China, Japan and South Korea as Britain seeks to replace agreements the EU has with more than 50 countries. “Following the referendum result, my absolute priority is making sure the UK has the tools it needs to continue to compete on the global stage,” his office had said in a statement. Javid also held talks with senior management of Tata Steel, including Chairman Cyrus Mistry, ahead of the company’s board meeting later in the day. Javid’s meeting with the Tata management was crucial amid reports that Tata Steel might pause plans to sell off most of its troubled UK units. The British government wants to stop the sale, which might push nearly 2000 jobs into uncertainty. Javid did not comment on the meeting. Britain is the largest G20 investor in India, while India invests more in Britain than the rest of the European Union. India has also emerged as the third largest source of foreign direct investment for Britain. On the other hand, Britain was the third largest investor in India during April 2000 to September 2015, with cumulative inflows of 22.5 billion pound. Bilateral trade in goods and services between the two countries was £16.55 billion in 2014-15. 10 • India Newsletter
Google to train 2 million developers in India Google announced the launch of its Android Skilling program in India that will aim to train two million mobile developers. Google unveiled a slew of initiatives to skill up, educate, and certify millions of students and developers in Android Development. Google announced the launch of a specially designed instructor led training program on Android Fundamentals. This will be made available across public and private universities and training institutes of the National Skill Development Corporation of India. The in-person training module integrated into the course curriculum will be introduced within this calendar year at no additional fee. Caesar Sengupta, VP, Product Management at Google said, “India is expected to have the largest developer population globally, overtaking the US, by 2018, with four million developers. But today only 25 per cent of developers are building for mobile. We believe India is uniquely placed to innovate and shape the Internet experience of billions of users who are and will come online on the mobile platform.” The Android Fundamentals course will also be available, free of charge, on NPTEL (an initiative of the IITs and IISc) as part of its online Mobile Computing course starting 18th July 2016. Additionally, Google has tied up with training partners like Edureka, Koenig, Manipal Global, Simplilearn, Udacity and UpGrad who will operate as authorised Android Training Partners in India. Google will train their trainers and to update their Android courseware to prepare students for the Android Certification and a career in Android development. Google also announced the launch of its globally recognised job-oriented Associate Android Developer Certification-a performance-based
exam that will help successful candidates to get an entry-level Android Developer jobs in the Industry. After training, aspiring candidates can log on to the Google Developer training website and take the certification exam priced at Rs 6,500. “We introduced the Android Nanodegree program in India last year with Udacity, and today, we have over 11,500 students in India enrolling every month in our Android courses. For university students we have now-for the first time-introduced a instructor led Android Fundamentals course to be incorporated into university curricula in India,” said Peter Lubbers, Head of Google Developer Training. “We also realise that India has a huge base of developers seeking opportunities for employment. And for that, we are introducing a globally recognised, job-oriented Google Developer Certification. The certification sets a benchmark for the industry to evaluate developer capabilities and is mapped to an actual job already in the industry, as determined by job task analyses.” he added. In addition to partnering with Universities, NPTEL and industry training partners, Google will also open-source all Android Developer Fundamentals practicals and courseware and make these available to everyone for free.
Germany’s Heraeus opens recycling facility for spent reforming catalysts in India Germany’s Heraeus, one of the world’s largest recyclers of reforming catalyst, has opened a new facility at Udaipur (Rajasthan) to recover precious metals from spent petroleum catalysts. The new site, operated by Ravindra Heraeus (the joint venture between Ravindra Choksi family and Heraeus), will offer India’s petrochemical industry more capacity and technology to recycle platinum and palladium in the country. Indian companies will therefore
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benefit from larger national recycling facilities, which will provide less transport costs and easier file processing, faster recycling times and better transparency in the market and overall improved costing for catalyst recycling. The new technology will furthermore offer latest environmental and social standards. After the recycling process, Ravindra Heraeus offers its customers to either receive new precious metals products, precursors or the pure recycled precious metals. “The new recycling facility of Ravindra Heraeus in India will allow our customers from the petrochemical sector to receive outstanding catalyst recycling standards in India. We will be the only globally active precious metal company with local recycling capabilities in this very important sector. Together with our trusted and long-term partner Ravindra we will be able to offer fast, local and first class recycling services to our customers,” commented Andre Christl, president of Heraeus Metal Management, the company’s precious metal recycling and trading unit. Established in 1994, Ravindra Heraeus is one of India’s leading companies for precious metal products. Shailesh Choksi, managing director of the JV, stated, “Our company is specialised in the manufacturing of high-tech precious and specialty metal products and solutions. Ravindra Heraeus’ comprehensive refining services cover various types of precious metal containing material and make us the leading partner for the customer’s business.” Heraeus, the technology group headquartered in Hanau (Germany), is a leading international familyowned company formed in 1851. The company focuses on themes such as the environment, energy, health, mobility and industrial applications. Its portfolio ranges from components to coordinated material systems which are used in a wide variety of industries,
including the steel, electronics, chemical, automotive and telecommunications industries. In the 2015 financial year, Heraeus generated revenues without precious metals of Rs 245.50 billion and a total revenue of Rs 881 billion. The company has approximately 12,500 employees worldwide in more than 100 subsidiaries in 38 countries.
India’s first IoT centre launched in Bengaluru with five startups Five startups have been chosen to be part of India’s first centre for excellence in Internet of Things (IoT), the segment where sensors in devices such as a smartphone or a smoke detector talk to each other and share data using the internet. The startups Wireless Controls, Uncanny Vision, LightMetrics, ThingsCloud and SAAR Microsystems have been chosen for the first CoE in Bengaluru. “The growth of IT in the world has followed certain conventional patterns. I will be the happiest if your extraordinary potential propels products that truly become products and used across the world. Healthcare, education and agriculture should be the priority areas wherein give long benefits to people of India, “ said Ravi Shankar Prasad, Union Minister for IT and Electronics. The centre, which can house 40 startups, is jointly set up by software industry grouping National Association of Software and Service Company (NASSCOM), Department of Electronics and Information Technology (DEITY) and Education and Research Network (ERNET). Internet of Things (IoT) is described for devices that have sensors which talk to and share information to other devices over the internet. “If a new initiative comes from Karnataka why should it not be replicated in the rest of the country. All these products on the smart phone or the phones should be available in local languages as well,”
said Prasad. The IoT centre, which allows startups to build a prototype and test them, will focus on building solutions for applications such as agriculture, automobile, telecom, healthcare and consumer goods. “IoT is one of the high growth potential areas in the IT sector. With the growing number of IoT based startups in the Indian market, it becomes imperative to create an enabling ecosystem to help evolve this space, empowering companies to build technologies that provide global solutions,” Ajay Kumar, additional secretary, Department of Electronics and Information Technology, (DeitY) said.
Govt aims to make India design hub, new national policy likely To encourage companies to focus on innovation in product and process design, and with an eye on making India a global design hub, the industry department is planning to come up with a new national design policy. The new policy will replace the current one approved in February 2007 and focus on promoting specific sectors such as defence, medical devices and electronics, a government official said, speaking on condition of anonymity. “The government will financially incentivise approved designs to turn them into mass market products,” the official said. The National Design Council (NDC), under the Department of Industrial Policy and Promotion (DIPP), launched India Design Mark or I Mark in 2010 in partnership with the Good Design Award in Japan (G Mark). It is granted to manufacturers of welldesigned products manufactured in a responsible manner, involving a rigorous process against established criteria. All types of mass-produced products are eligible for the India Design Mark. They can include consumer electronics, computer and communication products, machine India Newsletter • 11
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tools, construction machinery, lighting systems, white goods, household appliances, capital goods, medical equipment, toys, vehicles, and agricultural machinery among others. “India Design Mark provides strong differentiation and market positioning as a design and innovation leader. It acts as a brand extension and imparts competitive advantage to the product in local and international markets. It serves as a unique promotional launch pad for new products and services entering the market. India Design Mark provides international leverage by exemplifying the export worthiness of the product,” the I Mark website states. The official quoted earlier said in countries like Japan the native design mark is sought after by consumers and producers alike as it means the producer has followed ethical and environmentally sustainable production processes. “In India, due to lack of awareness, design certification has not picked up. We are striving to change that,” he said. In fact, G Mark is an influential decision-making tool for Japanese consumers, with a recent survey indicating that 48.5% of Japanese consumers would opt for products bearing the mark, while 87.5% acknowledged it to be the trademark for well-designed products. “We need to promote good designs to capture higher value. (We) will work on both the supply and demand side to boost India Design Mark,” DIPP secretary Ramesh Abhishek tweeted on 2 July. Pradyumna Vyas, director at the National Institute of Design (NID) Ahmedabad and member secretary, NDC said the council is intending to scale up and reach a larger audience with this year’s India Design Mark competition. “Since we are promoting manufacturing through Make In India, the country could be a global design hub through design outsourcing as design is an essential value addition in the 12 • India Newsletter
process of manufacturing. The new NIDs being set up will help us create the necessary manpower for this,” he added. The government has already set up an NID in Vijayawada and the Kurukshetra NID is expected to start its academic session this year. The Union cabinet has approved two more NIDs in Bhopal and Jorhat.
India manages one-third of Cisco’s US$ 36 billion product revenue Cisco launched its globalization centre east in Bengaluru in 2007, a centre that it calls its second headquarters and which was established to develop new IT solutions for emerging markets and the world in general. Amit Phadnis, president engineering and India site leader of Cisco, talks about the progress the centre has made. Excerpts: Give us an idea of the extent of innovation happening out of Cisco’s R&D centre in Bengaluru. We make switching products, next generation wireless products and also storage spaces that are competitive globally. One of the advantages is, we are able to develop these products at a competitive price. We have developed 10 products from India since 2010 and have another 10-15 products in the pipeline that are completely engineered out of the country. Each of these globally has at least a $100 million annual run rate. We are roughly a third of Cisco’s engineering worldwide. Out of Cisco’s total product revenue of $36 billion, $13 billion comes from products developed and managed out of India, the largest any company drives out of the country (products managed are those that may have been developed elsewhere, but are now completely handled, including development of upgrades, by the India team). 52986633 How is Cisco’s involvement with the smart cities programme in India going?
We have done deployments in Navi Mumbai and Jaipur. The Jaipur Development Authority will set up a digital infrastructure provided by us to offer citizens amenities including connected transport, interactive kiosks, wireless broadband, safety and security services, traffic management and environmental updates. It will install an urban platform of sensors which allows for the sharing of information. In Navi Mumbai, such an application is used to create public security and safety infrastructure. Running on a Cisco network, this solution provides live camera updates and alerts so that security breaches are not missed due to human error or oversight. How big is the R&D team in Bengaluru now? There are 7,000 engineers in the R&D facility, which is the biggest outside our San Jose (US) facility. San Jose has about 12,000-13,000 engineers. The way we are growing, we may cross them some day. Moreover, 10% of Cisco’s patents are filed out of India. Out of the 1,000 filed, 600 have been issued. It is literally 2 patents filed per week from here now. What is the charter ahead for the engineering team? The charter is to take more complex responsibilities for product development. If you look at some of the products, we are pushing the envelope at what is possible in technology today. To create a larger ecosystem, we are getting the engineering team closer to the field engineers and sales teams, who really work with customers to understand their problems.
India maintains its supremacy over China in Pharmaceuticals India’s pharmaceutical exports continued its lead over China in 2015. While India’s Pharma exports grew from US $11.66 Billion to US $12.54 Billion in 2015 recording a growth of 7.55%, China increased its exports of Pharma products from
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US $6.59 Billion to US $6.94 Billion showing a growth of 5.3% during the same period. India moved ahead of China in all important markets such as US, European Union and Africa. India’s exports of Pharma products to US jumped from US $3.84 Billion to US $4.74 Billion, a growth of 23.4% as against China’s Pharma exports to US which moved from US $1.16 Billion to US $1.34 Billion in the same period showing a growth of 15%. India maintained its lead with growth in EU and Africa recording exports of US $1.5 Billion and US $3.04 Billion respectively while China’s exports to EU & Africa showed a declining trend in both the markets.
One-window clearance may boost Mumbai realty Mumbai realtors expect the BrihanMumbai Municipal Corporation (BMC)’s single-window clearance for construction to be a game changer, which could lead to the much-needed correction in prices of residential property. At present, obtaining construction permits accounts for 46 per cent of the total cost of construction, say experts. BMC recently brought down the number of approvals builders need before starting construction from 119 to 58. This will also cut the time taken for getting approvals for a building project to 60 days against one-to-two years earlier. According to Knight Frank Executive Director Gulam Zia, while regulatory uncertainties plague the entire Indian realty, it’s always a make-orbreak situation in Mumbai due to the high stakes involved. “Due to exorbitant land values already spent by developers, the cost of delay is ultimately passed on to buyers. So, if BMC can actually deliver on its promise of single-window clearance, with a time-bound approach, we can expect price correction in the overheated Mumbai market,” he told the Business Standard. According to BMC officials, singlewindow clearance envisages,
among other things, the use of self-certification by developers for approvals related to debris removal, property tax, and pest control. Besides, processing of no-objection certificates (NOCs) will be initiated even before the application for permit is submitted. There will also be simultaneous issuance of intimation of disapproval and commencement certificate within 30 days from the receipt of proposal including site visit and approval of concessions, if any, from authorities. Ramesh Nair, chief operating officer (business) and international director at JLL India, said if the reforms succeed in bringing down the costs involved in obtaining permits, the benefits could be passed on to consumers, making housing more affordable as well as boosting the absorption of real estate in the city. “Earlier, a building construction proposal in Mumbai required a series of approvals from 3035 different departments of the municipal corporation, the state government and various central government agencies. Under the new system, developers will require 58 certifications against 119 earlier, a reduction of 52 per cent in the number of approvals, NOCs and BMC remarks,’’ he added. Nahar Group Vice-Chairman Manju Yagnik said the benefits are manifold as this will reduce the time taken for getting clearances from various authorities. It will also result in faster completion of projects and quicker handover to the home buyer. For the industry, it will help root out any anomaly, which also adds up to the final cost of an apartment thus making the end product much cheaper for the home buyer. “The end users are definitely going to benefit because as now the final cost to home buyer will be much lower. This is due to the fact that developers can complete their project and pay of the debts on loans taken much sooner,” she added. According to Kumar Urban Development spokesperson Kruti Jain, the smooth, easy approval
process will have a direct impact on the cost of construction reduction and it will also reduce corruption. Developers will have some amount of money, which they can pass onto home buyers provided it’s implemented to full potential. “The online procedure for approvals has nearly half of the original approvals and is savvier to navigate through. All these factors will reduce the price of homes significantly as it originally used to take up approximately 36% of the cost of construction. Lower costs will boost demand and keep the real estate market vibrant,’’ she opined.
Government eases funding rules for startups A recent notification issued by the ministry of corporate affairs (MCA) makes it easier for startups to access funds via the convertible note route. This notification is part of the allround initiatives planned by the government to strengthen the startup ecosystem in India. Funds received by a startup amounting to Rs 25 lakh or more by way of a convertible note, in a single tranche from a person, will not be treated as a `deposit’. The convertible note is to be either converted into equity or repaid within a period of five years.The Companies (Acceptance of Deposits) Rules have been accordingly amended via a notification dated June 29. Owing to this relaxation, the stringent rules relating to informing the registrar of companies (RoC) or creating a deposit repayment reserve in the books of accounts will not apply to the startup receiving funding via convertible notes. However, it should be noted that the relaxation is available only to startups that meet the governmentprescribed norms (as defined by the department of industrial policy and promotion, or DIPP). This notification is the second such initiative to ease funding challenges for startups. TOIhad in its edition da ted June 20 reported that eligible India Newsletter • 13
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startups will be exempt from angel tax. They will not have to pay any tax on the differential between funding received from non-registered funds or high net worth individuals and the fair market value of their entity. Startups are defined by a DIPP notification dated February 17, 2016, to mean “an entity, incorporated or registered in India not prior to five years, with annual turnover not exceeding Rs 25 crore in any preceding financial ye ar”. Second, such an entity is required to be engaged in “development, deployment or commercialization of new products, processes or services driven by technology or intellectual property”. If a tax holiday is to be availed, the entity is required to be set up between April 1, 2016 and March 31, 2019 and an approval of an interministerial board set up by DIPP is required. The tax holiday is available for a period of three years in a block of initial five years. 571 apply for Startup India initiative A status report issued by `Startup India’, the government initiative under the auspices of the DIPP, provides an indication of the interest in the programme. Till June end, 571 applications had been received from entrepreneurs. While 106 of these applications were complete, all of them will not get a tax holiday (even as other incentives could be available) as a majority of these companies were incorporated prior to April 1. Only 12 entities qualify for the tax holiday, subject to clearance by the inter-ministerial board. Five of these entities have yet to provide the required documents. DIPP is reaching out to top companies requesting them to set up new incubators or scale up existing incubators in collaboration with educational institutions. An online learning module will soon be available for entrepreneurs. 14 • India Newsletter
World Bank commits $1 billion for India’s solarenergy programme The World Bank Group signed an agreement with the International Solar Alliance (ISA), consisting of 121 countries led by India, and committed to provide $1 billion in support to Indian solar energy projects. The World Bank-supported projects include solar rooftop technology, infrastructure for solar parks, bringing innovative solar and hybrid technologies to market, and transmission lines for solar-rich states. The cumulative investment in India’s solar sector would be World Bank’s largest financing in this sector, so far, for any country in the world, it said in a media statement. The ISA was launched at the UN Climate Change Conference in Paris on November 30, 2015, by Prime Minister Narendra Modi and French President Francois Hollande. Through ISA, India aims to collaborate with global agencies and mobilise around $1 trillion of investment in solar energy by 2030. The agreement was signed by Finance Minister Arun Jaitley, Union Minister of State with Independent charge for Power, Coal, New and Renewable Energy Piyush Goyal and World Bank Group President Jim Yong Kim. “India’s plans to virtually triple the share of renewable energy by 2030 will both transform the country’s energy supply and have far-reaching global implications in the fight against climate change,” said Kim. He also said that this agreement with the ISA would help mobilise a global movement toward a climatefriendly future. As part of the agreement, the World Bank Group will develop a road-map to mobilise financing for development and deployment of affordable solar energy, and work with other multilateral development banks and financial institutions to develop financing instruments to support solar energy development.
The World Bank also signed an agreement to pump funds close to $625 million for the Grid Connected Rooftop Solar Program under the National Solar Mission. The project will finance the installation of around 400 megawatt of solar photovoltaic power projects. The development of a $200 million shared infrastructure for Solar Parks Project under a public-private partnership model is also under preparation, said World Bank.
India jumps 19 places in World Bank’s logistics performance index India’s logistics performance at its key international gateways has improved in the last two years, according to a World Bank report released on Tuesday. In the World Bank’s biennial measure of international supply chain efficiency, called Logistics Performance Index, India’s ranking has jumped from 54 in 2014 to 35 in 2016. While Germany tops the 2016 rankings, India is ahead of comparatively advanced economies like Portugal and New Zealand. In 2016, India’s international supply chain efficiency was at 75% of topranked Germany, said the report titled Connecting to Compete: 2016 Trade Logistics in the Global Economy. This is an improvement over the 66% efficiency when compared to the leader (again Germany) in 2014. Better performance in logistics will not only boost programmes, such as Make in India, by enabling India to become part of the global supply chain, it can also help increase trade. In 2015-16, India’s foreign trade shrank by around 15%. The Logistics Performance Index analyses countries across six components: efficiency of customs and border management clearance, quality of trade and transport infrastructure, ease of arranging competitively priced shipments, competence and quality of logistics services, ability to track and trace
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consignments, and the frequency with which shipments reach consignees within scheduled or expected delivery times. It is computed from the survey responses of about 1,051 logistics industry professionals. Programmes, such as Make in India, and improvements in infrastructure have helped India improve its logistical performance, said Arvind Mahajan, partner and national head (energy, infrastructure and government) at KPMG India, a consultancy. He also said that the emergence of skilled professionals and technological improvements that have enabled services such as track-and-tracing have helped India close the gap with leaders. That said, Logistics Performance Index does not address how easy or difficult it is to move goods to the hinterland. For that, World Bank has another measure—a domestic LPI which analyzes a country’s performance over four factors: infrastructure, services, border procedures and supply chain reliability. While not all yardsticks are comparable across countries, there are some which show that India still has some way to go. For instance, only 69% of shipments from India meet the quality criteria, compared to 72% for China and 77% for Kenya. On the other hand, it takes two and three days to clear shipments, without and with inspection, respectively—numbers comparable to China but longer than what it takes in top-ranked Germany. Similarly, India has an average of 5 forms required for import or export, compared to 4.5 for China and 2 for Germany. In this regard, the Goods and Services Tax (GST) has the potential to revolutionize the transport industry in India, said Capt. Uday Palsule, former managing director of Spear Logistics Pvt. Ltd. “Inter-state travel time will be drastically reduced if the hurdle of checking documents at every state border is done away
with,” he said. It will also help boost the returns of the trucking industry and feed into better performance of the logistics sector, added Palsule.
MNRE ropes in Germanybased KfW Development Bank to fund two floating solar projects After solar parks developed over vast tracts of land, the next big thing in renewable energy could be solar parks floating on water bodies. The Ministry of New and Renewable Energy (MNRE) has initiated a study to assess the potential of floating solar parks in India. It has roped in Germany-based KfW Development Bank to build two large floating solar projects in Maharashtra and Kerala at an initial investment of about Rs 300 crore. “The KfW-funded floating solar park would be a showcase project that would demonstrate the technical viability of large solar projects. To begin with, at least 40 MW of floating solar capacity would be set up,” said a senior MNRE official. “Initial estimates suggest that the country could generate at least 310 gigawatts of green power from such floating solar parks,” said SP Gon Chaudhuri, chairman of the Kolkatabased Renewable Energy College. MNRE ropes in Germany-based KfW Development Bank to fund two floating solar projects “This assumes that only 10% of the water bodies can be used for setting up floating solar facilities.” The MNRE has entrusted the National Institute of Solar Energy and the Renewable Energy College to jointly undertake the study. They will rope in the National Remote Sensing Centre to evaluate the potential for floating solar plants, he said. There are 61.48 lakh hectares of still water surfaces in India, of which reservoirs are 29.26 lakh hectares and tanks and ponds are 24.24 lakh hectares, according to the agriculture ministry. Floating solar panels are more efficient than those on land because the water bodies cool them. Several companies and
states have started looking at the option of such plants. “One can generate 17 lakh units of power from a one megawatt floating solar facility per year, while the same on land will generate 16 lakh units. The area required for setting up the panels is the same - 4 acres per megawatt and the average generation cost thus is about Rs 7 per unit for both. Cost-wise, floating panels are a tad more expensive at Rs 8 crore per megawatt. However, as demand rises, the cost will also come down,” said Gon Chaudhuri. The solar panels will be set up on floating platforms anchored firmly so that they do not drift. The main saving is on the land price and yield. The surface of the water body can be rented out at a minimal rate because they can be put to no other use.
India’s best is yet to come: Narendra Modi Prime Minister Narendra Modi on Monday emphasized the progress his government has made in the little over two years it has been in power, even as he struck a pragmatic note, far removed from the hyperbole that characterized his speeches in the run-up to the 2014 parliamentary elections. Modi also outlined the contours of his government’s foreign policy, particularly with respect to regional rivals Pakistan and China. Taking China’s rebuff at the recent meeting to consider India’s membership of the Nuclear Suppliers Group (NSG) in his stride, the Prime Minister said the central pillar of this engagement is continued dialogue and progressively seeking out common ground. “Foreign policy is not about changing mindsets. Foreign policy is about finding common meeting points,” he said. Modi also signalled his government’s resolve to push for the passage of the much delayed constitutional amendment bill for implementation of the goods and services tax (GST). He sought to politically isolate the Congress, which has blocked the passage of the bill in the Rajya India Newsletter • 15
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Sabha, and was careful to emphasize that its passage would benefit the poorer segments in states such as Bihar, Odisha and West Bengal—all opposition ruled states. In an 85-minute interview with Times Now, Modi said there is now no “trace” of the all-pervasive “disappointment” that summed up how people felt about the then-ruling United Progressive Alliance in 2014. The Congressled coalition was voted out for its mismanagement of the economy and a spate of corruption scandals. Only a comparison with the decade for which the UPA had governed India would show people “where we were and where we are now”, Modi added. “The entire system was engulfed in disappointment,” the Prime Minister said, referring to the UPA’s legacy. “And today you can see that in every sector, the changed circumstances can be seen,” he added. Since taking charge, the Bharatiya Janata Party-led (BJP-led) National Democratic Alliance (NDA) has focused its efforts on largescale campaigns that seek to improve sanitation and hygiene; revive manufacturing; foster entrepreneurship; train Indians in areas where jobs can be had; and bring more Indians into the banking and finance mainstream. Setting out the defining ideology of his government, he said, “Our philosophy is to reach the last man in the line,” adding, “So my development parameter is very simple. It is about how the poorest of the poor can benefit from development. The poor is the central focus of my economic agenda.” Modi emphasized that job creation was the key to fighting poverty and addressing growing aspirations, among the “neo” and middle class. “The young have their aspirations. So another aspect of my policies you must have seen are Start-Up India, Stand Up India, seaport activity... These changes directly appeal to the middle class. We have to create jobs. How will jobs happen? Till I invest in 16 • India Newsletter
the development of infrastructure, there will be no job creation,” he said. Alluding to the obstructionism of the Congress in the Upper House, the Prime Minister skilfully linked all the policy changes undertaken by the NDA to alleviate poverty, in the process giving key political cover to the reform initiatives, including GST. Political analysts said the comments were aimed at isolating the Congress. “PM’s comments on the Congress party were very tactical and oriented towards a disunity among the opposition. If one notices, in the initial period, the opposition unity was high but soon after the logjam got prolonged, one could see fissures in the opposition as a whole. In that way, Modi’s statement is crucial and aims to politically isolate the Congress party,’’ said Abhay Kumar Dubey, a New Delhi-based political analyst associated with the Center for the Study of Developing Societies. The NDA has liberalized foreign direct investment rules—the country attracted $55.45 billion of FDI in 2015-16, compared with $45.14 billion the previous year— although it has steered clear of wiping the slate clean when it came to some of the previous government’s tax policies. The NDA has had to cope with the slowing global economy, two successive droughts and the consequent agrarian crisis, and hot-heads within the BJP who have lashed out at anything and anyone that they believe don’t have a place in their concept of a ‘Hindu nation’. Modi, proactively eloquent ahead of the 2014 parliamentary elections, has been strangely silent at the statements and actions of these hotheads, although in his interview with Times Now he said that people were giving them too much importance. For the first time, he also spoke out in support of Reserve Bank of India governor Raghuram Rajan who has been at the receiving end of criticism, some of it personal and nasty, from BJP Rajya Sabha MP Subramanian
Swamy. He characterized such criticism as “inappropriate” and added that his own experience with Rajan “has been good”. “I appreciate the work he has done,” Modi added. Manisha Priyam, a Delhi-based political analyst, said, “His strongly defensive stance towards Rajan showed that Modi is in command of the party and has distanced himself from the people making remarks against Rajan’s ‘foreign roots’.” While he defused the controversy around Rajan’s exit, the prime minister also listed out his government’s achievements, particularly on inflation. Inflation is nowhere near being the menace it was in 2013 and 2014, although it has gone up in recent months. And India’s economy expanded by 7.6% in the year ended 31 March compared with 7.2% a year ago, 6.6% in 2013-14 and 5.6% in 201213. “There is no doubt that the rate of inflation has come down compared to (what it was during) the previous government, but the increasing gap between supply and demand for pulses cannot be addressed through imports or by cracking down on hoarding,” said T. Haque, director of the Delhi-based Council for Social Development and former head of Commission for Agricultural Costs and Prices. The government’s efforts, Modi stressed, were on inclusion, to cater to the needs of the poor, and on meeting the aspirations of young people. The easiest way to create jobs, he told Times Now, is to make it easier for small businesses to operate and do well, which, in turn, would encourage them to hire more people. “Job creation is work in progress. Manufacturing, construction and highway development are all labour intensive sectors. It is appropriate to focus on these sectors for job creation. The textiles sector, which is labour-intensive, but is performing below potential, deserves more attention. Also, the government
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should keep in mind the increase in productivity while addressing the issue of employment creation,” said D.K. Joshi, chief economist at rating agency Crisil. Although the NDA’s continuation of some of the UPA’s entitlements-led approach has not gone down well with some of its supporters who subscribe to a far more right-leaning economic philosophy, Modi said this focus on development would be his party’s preferred approach to next year’s all-important state election in Uttar Pradesh. According to Modi, the government had acted to address the problem of rural distress—triggered in the aftermath of two consecutive droughts and a collapse in global commodity prices. While the NDA persisted with the rural employment guarantee scheme of the UPA, it has also taken steps to use marketbased instruments to underwrite the growing risks of farming commercial crops. In this, he dwelt on the crop insurance scheme rolled out by the NDA. Admitting that a constant electoral cycle (five states have gone to the polls in 2016) could affect policymaking, Modi spoke of his government’s and party’s support for a move to hold state and parliamentary elections
simultaneously. That process, however, is in its preliminary stages and could take a while, if anything comes of it at all. In the meantime, the government of the day will need to build bridges with rivals, something that Modi said his party has been able to do when it comes to the critical GST, with most parties except the Congress. And even that, he seemed to suggest, wasn’t for want of trying, at least not on his part. Indeed, the Congress, he hinted, was only focusing on the negatives— such as India’s inability to be accepted into the NSG, which he said was a process that would follow its own cycle—and not on the positives, such as his successful visit to the US and improving relations between the two countries. Foreign policy has been big on Modi’s agenda, although he described India’s push in this area as a team effort involving several ministries apart from his office. India, he added, has had to make up for lost time in a world that is no longer bi-polar. India’s application to the NSG was opposed by China and a few others (although the government has clarified that there was 32 interventions in its favour in the 48-member body). With China, Modi said, the only way
forward was through talks, and the objective of foreign policy was to find “common meeting points”. “Previously, Modi’s efforts were focused on friendship and economic engagement with China. Now, Modi seems to have understood that China would follow an assertive foreign policy, one that positions China as a leading power in the world which will not allow India to stand in the way,” said Lalit Mansingh, former foreign secretary. “I think we will now see a more realistic foreign policy being crafted vis-a-vis China,” Mansingh said. The Pakistan issue was expected to come up at the NSG meeting in Seoul last week, but it did not. India and Indians would do well not to look at everything through the Pakistan filter, Modi said. “Pressure on terrorists has increased and their schemes are proving unsuccessful,” he said, but admitted that dealing with Pakistan was not easy because “there are different types of forces operating” in that country. India wants friendly relations with Pakistan but “without compromising on our interests”, Modi said in the interview. Meenal Thakur, Pretika Khanna, Gireesh Chandra Prasad, Sayantan Bera and Shreeja Sen contributed to this story.
INDIA PERSPECTIVES MAGAZINE ONLINE
India Newsletter • 17
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MAKE IN INDIA Summary ■■ 88 projects involving investment of INR 380 Billion approved in last three years. ■■ 45 Public Private Partnerships (PPPs). ■■ 12 major ports. ■■ 64 non-major ports handling EXIM cargo. ■■ 1521 Million Metric Tonnes in cargo capacity(2014-15). ■■ INR 175 Billion invested in last three years.
PORTS & SHIPPING
Reasons to Invest ■■ Projected cargo traffic to be handled by Indian ports by 2021-22 is 1695 Million Metric Tonnes as per the report of the National Transport Development Policy Committe - an increase of 643 Million Tonnes from 2014-15. ■■ 2422 Million metric tonnes of cargo handling capacity required in Indian ports by 2021-22. ■■ For this, additional cargo handling capacity of 901 million metric tonnes is required to be created in Indian Ports in the next 6 to 7 years. ■■ Port Projects involving investment of over USD 10 Billion identified for award during the next five years. ■■ Special Economic Zones (SEZs) are being developed in close proximity to several ports – comprising coalbased power plants, steel plants and oil refineries.
Statistics ■■ Over 7500 kilometres of coastline with 12 major and about 200 nonmajor ports. ■■ 90% of the country’s trade by volume and 70% by value is moved through maritime transport. ■■ Cargo traffic achieved CAGR of 4.4% during 2009-10 to 2014-15. ■■ Cargo handled at ports in 201415 – Dry bulk (34% – iron ore, coal, fertiliser, food grains); liquid bulk 18 • India Newsletter
(33% petrol, oil and lubricants); break bulk(17%) and container (16%). ■■ 12% major ports in India handle approximately 57% of Cargo traffic. ■■ An unprecedented increase in cargo-handling capacity of major ports - 871 Million Metric Tonnes in March 2015, from 575 Million Metric Tonnes in 2009.
Growth Drivers ■■ Increasing trade activities and private participation in port infrastructure development. ■■ Rising cargo traffic and an increase in the number of nonmajor ports. ■■ Existing ports are investing on improving their draft depth. ■■ Focus on the development of terminals that deal with a particular type of cargo, for eg. LNG.
FDI Policy ■■ To attract investment for the growth of this sector, the Government has allowed 100% Foreign Direct Investment (FDI) in the shipping sector. ■■ 100% FDI is allowed under the automatic route for projects related to the construction and maintenance of ports and harbours.
Sector Policy ■■ Major ports are under the jurisdiction of the Government of India and are governed by the Major Port Trust Act, 1963, except Ennore Port, which is administered under the Companies Act, 2013. ■■ Non-major ports are under the jurisdiction of the respective state governments’ maritime boards. ■■ A perspective plan of the government defines priority areas of investment in the Indian maritime sector. These include: ■■ Development of two major ports as well as two port hubs. ■■ Plans to implement full mechanisation of cargo handling and movement at ports.
Financial Support ■■ Allocation of INR 116.35 Billion for the development of the Outer Harbour Project in Tuticorin for Phase I. ■■ A Ganges-based project named ‘Jal Marg Vikas’ will be undertaken between Allahabad and Haldia. This project is to be completed over a period of six years at an estimated cost of INR 42 Billion. ■■ Exemptions under the Income Tax Act for Infrastructure Development, under Section 80IA.
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Investment Opportunities ■■ Port development – the opportunity to serve the spill-off demand from major ports. ■■ Port support services – operation and maintenance services such as pilotage, dredging, harbouring and provision of marine assets such as barges and dredgers. ■■ Ship repair facilities in ports – demand for ship repair services will
increase, providing opportunities to build new dry docks and set up ancillary repair facilities.
■■ AP Moller Maersk (Denmark)
■■ Directorate General of Shipping
■■ PSA Singapore (Singapore)
■■ Indian Ports Association (IPA)
■■ Dubai Ports World (UAE) ■■ Jan Del Nul NV (Belgium)
■■ Inland Waterways Authority of India (IWAI)
■■ Hyundai Construction
■■ Directorate General of Lighthouses & Lightships (DGLL)
Engineering and Company Limited
■■ Royal Boskalis Westminister NV (Netherlands)
EASE OF DOING BUSINESS Radical FDI changes make India most open economy in the world With the Centre radically liberalising the FDI regime by permitting 100 per cent foreign direct investment under government approval route for almost every sector, including defence, Prime Minister Narendra Modi said the initiative makes India the most open economy in the world for FDI. “Key reform decisions were taken at a high level meeting chaired by the PM, which makes India the most open economy in the world for FDI. Centre has radically liberalized the FDI regime, with the objective of providing major impetus to employment and job creation in India,” the Prime Minister’s Office said. The PMO in a series of tweet said
that India has been rated as Number 1 FDI Investment Destination by several International Agencies. “This is 2nd major reform after the last radical changes announced in November 2015. Now most of the sectors would be under automatic approval route,” the PMO said. “Reform measures undertaken by the Government have resulted in increased FDI inflows at US$ 55.46 billion in financial year 2015-16 as against US$ 36.04 billion during the financial year 2013-14,” it added. The Office also noted that now been decided to permit 100% FDI under government approval route for trading, including through e-commerce in respect of food products manufactured or produced in India. The key changes include allowing 100 percent FDI under government approval route for trading, including
through e-commerce, in respect of food products manufactured or produced in India and permitting up to 100 per cent FDI in defence sector. The other sectors that have benefitted include the broadcasting, pharmaceuticals, civil aviation, single brand retail among others. The ruling BJP-led NDA Government has brought major FDI policy reforms in a number of sectors like defence, construction development, insurance, pension sector, broadcasting sector, tea, coffee, rubber, among others in last two years. The FDI inflow into the country has increased at $ 55.46 billion in 201516 as against $36.04 billion during 2013-14. This is the highest ever FDI inflow for a particular financial year.
THE CHANGES INTRODUCED CAN BE CLASSIFIED INTO THE FOLLOWING HEADS INCREASE IN PRE- EXISTING SECTORAL CAPS
SECTORS BROUGHT UNDER AUTOMATIC ROUTE
LIBERALIZATION OF SECTORAL CONDITIONS
Pharmaceuticals Airports Civil Aviation Private Security Agencies
Food Products Broadcasting
Defence Manufacturing Animal Husbandry Single Brand Retail Trading Branch/Liaison/ Project Office
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PERSPECTIVES ON INDIA India: The most open economy for FDI.
in India rather than making profits through just trading activities.
By Ravi Capoor, IAS, CEO, IBEF The Government of India has recently announced radical liberalisation of the Foreign Direct Investment (FDI) regime by easing norms for a host of important sectors including defence, civil aviation and pharmaceuticals, opening them up for complete foreign ownership. The decisions included permitting 100 per cent FDI under government approval route for trading, including through e-commerce, in respect of food products manufactured or produced in India, bringing into effect the proposal made in the Budget ‘16-17. In defence, foreign investment beyond 49 per cent (and till 100 per cent) has been permitted through the government approval route, in cases resulting in access to modern technology in the country. The condition of access to ‘state-of-art’ technology in the country has been done away with. To promote foreign investment in the pharmaceutical sector, the government has permitted up to 74 per cent FDI under automatic route in existing pharmaceutical ventures. It added that the government approval route will continue beyond 74 per cent FDI and upto 100 per cent in such brown-field pharma ventures. Other important sectors like aviation and retail have also seen a wave of announcements easing foreign investments in these areas. In parallel, the government has also tightened rules for foreign companies aiming to produce items with cuttingedge and state-of-art technology by giving them only a three-year blanket exemption from the 30 per cent local sourcing norm over and above the five years where the 30 per cent procurement requirement would have to be met as an average of five years’ total value of the goods purchased. Experts believe that this will ensure that they manufacture
By L. Kannan, Founder and CTO, Vortex Engineering Pvt Ltd The PMJDY (Pradhan Mantri Jan Dhan Yojana) aims to ensure access to various financial services -- savings bank account, access to need based credit, remittances facility, insurance and pension - to the excluded sections i.e. weaker ones & low income groups. However, the last-mile of cashdisbursal remains a challenge: Typically, a human agent with a POS device and a bag of cash is the means. Designated as a “Micro ATM”, such a human agent is generally considered the key technology product for lastmile delivery of the PMJDY scheme and DBT (Direct benefit transfer). But such “Micro-ATMs” have never worked satisfactorily for a number of reasons, compelling the beneficiaries to visit the bank or head post office, which is not nearby, to obtain the payment. On the other hand, a conventional ATM is considered an overkill for deploying in these contexts. In the emerging economies like India, the major challenge in deploying ATMs in semi urban/ rural areas is to provide 24/7 availability at a viable cost. Grid power availability is a major challenge in these areas, and high cost involved in power backup solutions for traditional ATMs with high power rating and the air conditioner needs makes it unviable to deploy ATMs. Pioneering Low Footprint: The above business challenges warrant reducing the costs in running an ATM network in tier IV-VI locations. Vortex has pioneered an innovative Desk Top/Mini ATM solution, operating typically in day time hours, located in a shared space, consuming low power (solar backup) and with connectivity through GSM/CDMA dongle. With the Desktop/ Wall mounting
20 • India Newsletter
Mini ATMs - Made in India, Made for the World.
possibilities these ATMs can be installed in shared spaces within the post offices/ Kirana stores / common service centres. These Mini ATMs offer a low cost and high impact solution to the problems of not just the beneficiaries who want to access their balances, but also a befitting solution for the Banks and the ATM operators. These Mini ATMs eliminate the shortcomings of the regular ATM installation by reducing the Cap-ex and Op-ex costs, making it viable for the ATM to break even at 40 to 50 transactions per day. Setting benchmarks in Design The “Ecoteller Mini” comes with a “completely India designed” and patented dispenser technology. The software component of this ATM is based on Open Source technology which is also in line with current Govt. of India policy for public sector enterprises & in line with the “Digital India” initiatives. Why Small is indeed Beautiful This first of its kind smaller ATMs can be mounted like a post box in shared spaces within office/ bank/ post office lobby, kirana shops, hospitals, Metro stations, IT parks, shopping malls, etc., Easy Mobility: Can be easily ported wherever required The low foot print (2 sq.ft) reduces the space requirement, hence it brings down the rental overhead in commercial spaces No separate space to construct an ATM centre is required as it can be easily fixed in the available space within the banks’/ post office’s premises As it can be deployed in the available shared space, no ATM centre construction cost is involved. E.g: separate infrastructure like glass doors, wall, ceilings etc., Exclusive surveillance costs like security personnel, security systems like CCTV is not involved due to usage of shared spaces Provision to include cash deposit function
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INDIAN STATE ECONOMIC PROFILE UTTAR PRADESH Uttar Pradesh is the most populous state in India, with a large pool of skilled, semi-skilled and unskilled labour. Alternately, the population is also looked upon as the largest consumer base in the country with around 200 million people. It is the largest producer of food grains among all states in India and accounted for about 19 per cent share in the country’s total food grain output in 2014-15. The state has become a hub for the semiconductor industry with several major players having their offices and research and development (R&D) centres in Noida. Between 2004-05 and 2014-15, Gross State Domestic Product (GSDP) expanded at a Compound Annual Growth Rate (CAGR) of 10.72 per cent to US$ 161.1 billion whereas the Net State Domestic Product (NSDP) expanded at a CAGR of 10.66 per cent to US$ 142.1 billion. The state’s resources, policy incentives, infrastructure and climate are best suited for investments in diverse sectors such as Information Technology (IT), agrobased and food processing, light engineering goods, sports goods, textiles, leather-based, tourism and biotechnology. The state has a well-developed social, physical and industrial
infrastructure. It also has good connectivity through 48 national highways, six airports and rail links to all major cities. The state has witnessed a high rate of infrastructure growth in the recent past. There has been a considerable rise in the number of industrial clusters/hubs and Public-PrivatePartnership (PPP) projects in the infrastructure domain. The Uttar Pradesh State Industrial Development Corporation (UPSIDC) and the Department of Infrastructure and Industrial Development are responsible for the development of industrial infrastructure in the state. The state has a robust industrial infrastructure, including 15 industrial areas, 12 specialised parks, four growth centres and industrial infrastructure development centres (IIDC). As of March 2015, the state had 18 notified special economic zones (SEZs). As per the 12th FiveYear Plan, the state’s industrial growth rate is expected to average 11.2 per cent per annum. Some of the major initiatives taken by the government to promote Uttar Pradesh as an investment destination are: ■■ The Government of Uttar Pradesh presented a US$ 50,333.3 million Budget for 2015-16. The main objectives of the budget are: ■■ To promote development in
infrastructural facilities and ensure that the benefits reach the farmers, labourers and the poor in the state. ■■ To incorporate latest technology in carrying out various programmes and schemes. ■■ To maintain efficiency and transparency in administration. ■■ The state is in the process of implementing and testing the public–private partnership model in the power sector with an inputbased franchisee system. ■■ The state offers a wide range of subsidies, policy and fiscal incentives as well as assistance for businesses under the Industrial and Service Sector Investment Policy, 2004 and Infrastructure & Industrial Investment Policy, 2012. ■■ The state has well-drafted, sector specific policies for IT and biotech. ■■ The state government has set up Udyog Bandhu to facilitate investment in industrial and service sectors. The organisation has a three-tier structure with presence at district, divisional and state levels. ■■ The government of Uttar Pradesh has sanctioned 22 SEZs across the state, such as IT and ITeS, electronic hardware and software, handicrafts and agro-based industries. ■■ The state has proposed 40 IT/ ITeS parks (apart from IT SEZs), two biotech zones and a knowledge park. Development of integrated agro/food processing zones has been proposed at Hapur, about 54 km from Delhi. ■■ An apparel park at Tronica City, Ghaziabad, and a textile and hosiery park at Rooma, Dist., Kanpur, have been set up by UPSIDC to promote the apparel industry. India Newsletter • 21
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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 firstname.lastname@example.org to get more information about possible assistance/subsidies.
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INVEST INDIA Federation House, Tansen Marg New Delhi—110 001 0091-11-23765085, 23487278 email@example.com www.investindia.gov.in
policy and Promotion, Ministry INVESTMENT of Commerce & Industry) and State Governments of India (0.5% The National Investment and Infrastructure Fund(NIIF)
■■ Objective: ■■ To maximize economic impact mainly through infrastructure development in commercially viable projects, both Greenfield and Brownfield, including stalled projects. ■■ Other nationally important projects in manufacturing, if viable commercially ■■ Structure: ■■ The NIIF will be established as one or more Alternate Investment Funds (AIF). It refers to any fund established or incorporated in Indian in the form of a Trust or a Company or a LLP or a body corporate. AIF shall raise funds only through private placement
nvest India is the country’s official agency dedicated to investment promotion and facilitation. Set up as a joint venture between FICCI (51% and cannot accept from any equity), DIPP (35%funds equity held investor (Indian or Foreign) whose by the Department of Industrial value is less than 1 crore Indian Rupees and is prohibited from making application to public for subscription to its securities. AIF can be of three categories; ■■ Category I: Investment in Start-ups, SMEs, infrastructure or social ventures ■■ Category II: Investment in private equity and debt funds
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.
■■ Category III: Primarily for hedge funds, which use complex strategies or leverage to invest in unlisted derivaties and trade with a view to make short-term returns India Newsletter • 31
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TOURISM The Colourful Thrashing Festival of Latmaar Holi by Hugh & Colleen Gantzer. It was go-dhuli time in the Braj. In the twilight, cattle plodded home across the scrub lands of the Braj, raising pollen-clouds of dust: godhuli is, literally, ‘cow-dust’ time. Such pastoral metaphors are typical of the heartland of Uttar Pradesh with its long historical associations with herds-people. About 3,500 years ago, their Aryan ancestors, migrating down from the steppes of Asia, discovered these lush meadows. When they settled here they called this green terrain “Braj Bhoomi’: Land of the Encampments of Herdsmen. From these growing encampments, usually occupied by one extended family, came the term gotra: literally cattle-pen. To prevent the genetic dangers of endogamy, they established the tradition that one could not marry within one’s own gotra. Significantly, the dominant clan here was not any of the martial Rajputs, but powerful herds-people: the canny Yadavs.
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One of the great Yadav chieftains was Lord Krishna. We had come to Braj Bhoomi to experience a festival closely associated with Lord Krishna and his pastoral people. So did thousands of others, the majority of them pilgrims. Dressed in the festive finery that make all our celebrations look like flower gardens breaking ranks, they gazed in awe at a mural in a pavilion showing the peacockplumed Krishna lovingly dressing Radha’s hair while a winged attendant looked on. They inchwormed their way around a holy hillock, measuring the 22 km path with their prostrated bodies: the hillock was Govardhan, the one that Lord Krishna had raised on his little finger to protect his people from a deluge. We drove on through roads increasingly crowded with pilgrims. In the distance, a hill soared into the sky. This was Nandgaon: the legendary village of Nanda, foster father of Krishna. The hill was encrusted with houses, crowned with a white temple. Pilgrims, like streams of colourful ants, climbed up
to the temple and then scrambled down again. Another age ago, according to devotees, the young Krishna had led a raiding party of his companions from Nandgaon to Radha’s village of Barsana. There they teased her and here milkmaidgopis and, in their good-natured boisterousness, broke some of the women’s pots of yoghurt and milk. The irate gopis retaliated by belabouring their tormentors, using the long staves they carried to herd their cattle. This event is re-enacted every year in the famed Lat Maar … literally the Beating with Staves … Holi of Barsana. Entering Barsana, we got out of our car and merged with the river of humanity flowing through the narrow lanes of this ancient town. In spite of the teeming crowds, no one pushed or jostled or prodded: it was all very civilized, disciplined. We streamed into Rangili Gali .. Colourful Alley… found a perch on a raised platform in front of a chemist’s shop. Every balcony, every elevated plinth and staircase, every verandah and window overlooking
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the street, bulged with people. And yet the crowds got thicker and thicker: streaked, daubed, rainbowhued with the coloured powders of Holi. Clouds of colour rose like smoke, handfuls cascaded down on us and the vibrancy of Holi was like the frisson of static electricity shimmering over the restive crowd. Across the road, in a rising lane, a group of robed and turbaned priests began to chant an invocatory prayer. They were the Goswamis, literally Lords of the Cows. They belonged to a sect that placed considerable emphasis on an emotional acceptance of Lord Krishna with song and dance. Then, through their chant we felt a strange resonance starting to throb within us. Slowly, huge drums on wheels appeared, approaching us and, with every thud! delivered by their enthusiastic drummers, the resonance leapt within us. Suddenly the deep beat of the drums was muffled a cacophonic chorus of voices. They bellowed with more enthusiasm than skill but together, they and the drummers, seemed to cancel out the harsher effects of each other! We were relieved. They were the heralds of the main performers: the voluntary victims from Nandgaon. They followed the heralds with a shade of reluctance. They wore yellow robes, padded turbans on their heads fastened securely with yellow bands tied firmly under their chins; and they all carried leather shields padded on the inside. Then, trooping in with staves their own height, or even taller, came the vengeful women of Barsana. The colours kept raining down from overhead, as soft as talcum powder. The crowd murmured impatiently. The women lined up like an honour guard and the men began to dance, very gracefully, in front of them. There seemed to be a reversal of roles: graceful men, determined women. Then we heard the thuds, as if a dhobi was slamming clothes against a stone. Incredibly, many of the men were crouching down on the ground, padded shields raised
above their heads. The women were lifting their staves, and slamming them down of the shields as hard as they could. Some of the men sprang up after every blow. The women, too, leapt in the air before every whack! And this went on for two long hours: thud! thud! thud; the compulsive drumming, the bellowing chants, the colours raining down in clouds of red and pink and green; the staves raised and crashing down; the yellow-robed bodies moving over and over again. The emotional overkill began to gnaw at us and we wanted to leave but there was no way we could get through the mass of bodies jelled by the spell of that compulsive violence before them. When it was over we were as limp as dish-rags, drained of all feeling. The next morning, however, we visited the fortified hill-top town of Gokul where Krishna and his brother
had spent much of his childhood. In the courtyard of the small temple of Baldeo singers and musicians played lively, foot-tapping music. And women, their faces covered by their saris, got up and began to dance. Their steps and gestures were gentle and provocatively feminine. Clearly, the catharsis of Lat Maar Holi unveils the many hidden faces of humanity. QUICK FACTS Getting There: Air: Agra and then 62 kms. by road to Mathura Road: From Mathura â€“ 26 kms. to Govardhan; 50 kms. to Barsana; 56 kms. to Nandgaon; 15 kms. to Gokul and 20 kms. to Baldeo Local Transport from Mathura: Taxis & buses Accommodation in Mathura: A number of hotels to suit India Newsletter â€˘ 33
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INDIA-AUSTRIA BY AIR
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INDIAN MOVIE EVENING AT THE EMBASSY 29th July, 17:30 HINDI OV WITH GERMAN SUBT.
26th August, 17:30
30th September, 17:30 HINDI OV WITH GERMAN SUBT.
HINDI OV WITH GERMAN SUBT.
Seat reservation and further Infos: www.indianembassy.at Indian Embassy Business Centre/Library Kärntner Ring 2, 1. Stock, 1010 Wien India Newsletter • 37
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NOTICE BOARD EMBASSY’S LIBRARY ■■ The EMBASSY’S library is opened DAILY from 10am to 1pm without appointment. ■■ For a complete list of books available in our library, visit our website www.indianembassy.at ■■ For scheduling an appointment outside the opening hours, please contact the information assistant under firstname.lastname@example.org or 01 505 8666 33
BUSINESS CENTRE ■■ The EMBASSY’S Business Centre is opened DAILY from 10am to 1pm. ■■ For scheduling an appointment outside the opening hours, please contact the commercial wing under the contacts given below. ■■ Marketing Officer: email@example.com or 01 505 8666 30 ■■ Marketing Assistant: firstname.lastname@example.org or 01 505 8666 31
STUDENTS WELFARE OFFICER ■■ Mr. Brijesh Kumar, Second Secretary (Press, Info. & Protocol) in this Embassy has been designated as Officer to look after welfare of Indian Students in Austria and Montenegro. ■■ His contact details are: 0043 1 505 866 17 and email@example.com
MINISTRY OF EXTERNAL AFFAIRS GOES MOBILE ■■ Avail services : passport, visa, consular assistance ■■ Ask your Minister : on the go, anytime, anywhere ■■ Follow your PM : on his visits abroad ■■ Find the nearest Indian Mission/Post : for emergency consular assistance ■■ Be informed : about India’s Foreign Relations on the move and form your own opinions ■■ Know more : about how to undertake Kailash Manasarovar Yatra and Haj Pilgrimage ■■ Download and watch : pictures & documentaries on India ■■ Play and Personalize : what you need, when you need ■■ Share and contribute : your views, pics & suggestions
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