India Newsletter 10 2015

INDIA NEWSLETTER Indian Embassy, Vienna

Published by the Embassy of India, Vienna Year 5 • Issue 58 • October 2015

MAKE IN INDIA RENEWABLE ENERGY

India Newsletter • 1

Indian Embassy, Vienna

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 • 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

Indian Embassy, Vienna

NEWS FLASHES

01

The Government of India plans to further simplify rules for Foreign Direct Investment (FDI) such as increasing FDI investment limits in sectors and include more sectors in the automatic approval route, to attract more investments in the country.

02

India’s brand value has increased sharply by 32 per cent in a year to reach US$ 2.14 trillion in 2015, also leading to improvement in ranking among global nations to seven, according to a report

by London-based Brand Finance.

03

Prime Minister Mr Narendra Modi laid the foundation stone for the Fourth Container Terminal of Jawaharlal Nehru Port at Mumbai, which is expected to increase the existing capacity of the container terminal by more than twice.

04

The Indian economy is expected to continue on its growth trajectory, in contrast to slower growth in most of the world’s major economies, as per Paris-based Organisation for Economic Co-operation and Development OECD).

05

U S - b a s e d carmaker Ford Motor Company plans to completely design a new vehicle in India, thereby becoming the first global automobile major to do so, 4 • India Newsletter

compared to the current practice of manufacturing existing models and exporting from India.

06

Indian equity mutual funds have witnessed around 12,000 new equity accounts being opened every day in this financial year, which is the fastest pace of equity folio openings since the bull run of FY 2007-08.

07

Comparative advantage visà-vis peers in terms of manufacturing costs, market knowledge, technology and creativity has been a driving force for engineering exports from India. Engineering exports from India stood at US$ 70.6 billion in FY15, registering a Compound Annual Growth Rate (CAGR) of 11.1 per cent over FY0815.

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The Union Minister for Science & Technology and Earth Sciences Dr. Harsh Vardhan and the German Federal Minister for Education and Research Ms Johanna Wanka signed the main agreement for increased cooperation between the two countries in the field of science and technology, while delegates from both countries discussed and agreed to increase cooperation in several other areas.

11

Amazon India is set to launch its ‘Crafted in India’ online store and expand its designer wear store in anticipation of the Amazon Fashion Week this month, as part of its strategy to customise offering for individual users and boost sales.

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Gems and jewellery exports reached US$ 36.2 million in 2014–15.

The industry grew 4.3 per cent, with exports worth US$ 36.2 billion in 2014–15 compared with US$ 29.4 billion in 2009–10.

The Government of India is looking to invest around Rs 70,000 crore (US$ 10.7 billion) in 12 major ports in the next five years under the ‘Sagarmala’ initiative in order to promote ‘port-led development’ along India’s 7,500 km long coastline..

The World Bank has maintained India’s growth forecast at 7.5 per cent for the current fiscal amidst the unfavourable global economic scenario..

A team of scientists from India and Bangladesh will conduct for the first time, joint marine research within Bangladesh’s Exclusive Economic Zone, which is expected to help in understanding climate change and monsoon patterns in India.

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INDIA-AUSTRIA & EMBASSY NEWS Indian Women Empowering Austrian Women

Agreement Project.

On October 2nd the Ladies Organization of the Federation of Indian Chamber of Commerce and Industry (FLO) was a guest at the Austrian Chamber of Commerce.

Thirty-eight Indian entrepreneurs from the sectors of textile, crafts and jewelry were present. In addition, the fields of education and arts management were represented.

The Federation of Indian Chamber of Commerce and Industry (FLO) encourages and supports successfully for 32 years entrepreneurs and the training of women in management.

The event, which took place at the Austrian Chamber of Commerce offered initial information from experts and potential business opportunities in India.

Reception in honour of the Indian Delegation to the IAEA General Confernce.

Ambassador Rajiva Misra hosted a reception in honour of Dr. R.K. Sinha, Chairman of the Atomic Energy

Indian Delegation at the 59th General Conference of the IAEA

Conference of the IAEA, at the India House (Vienna) on September 13th, 2015. The Indian delegation headed

Dr. R.K.Sinha, Chairman, Atomic

by Dr. R.K.Sinha, Chairman Atomic

Energy Commission participated in

Energy Commission participated in

the 59th session of the IAEA General

the 59th session of the IAEA General

Conference in Vienna. The Indian

Conference. The Indian delegation

delegation consists of Ambassador

consists of the Ambassador Rajiva

Rajiva Misra, Dr. Sekhar Basu,

Misra, Mr.Sekhar Basu, Director

Chairman AERB,Mr. Pranay Verma, JS(ER), Dr.N.Ramamoorthy, BARC,

TNM Mobile App was launched by H.E. Rajiva Misra, Ambassador of India, on 16th Sep 2015 at Vienna International Centre. The TNM Mobile App is a cancer staging App developed by the IAEA, in cooperation with the Tata Memorial Centre, Department of Atomic Energy, India and was supported through the Regional Cooperative

Delegation to the 59th General

The Indian delegation headed by

Director, BARC, Mr. S.A.Bhardwaj,

Launch of TNM Mobile App at Vienna International Centre, Vienna

Commission of India and the Indian

Mr. Arun Srivastava, Head, ICPD,DAE, Dr. Suhel Ajaz Khan, DCM, Mr. Deepak Ojha, Counsellor (AE) and other officials of Indian Permanent

(BARC) , Mr. S.A.Bhardwaj, Chairman AERB, Dr. N.Ramamurthy, BARC, Shri Pranay Verma, JS (ER), Mr. Arun Srivastava, Head ISD, DAE, DCM Dr. Suhel Ajaz Khan, Counsellor(AE), Mr.Deepak Ojha and officials of the

Mission. The General Conference

Permanent Mission of India. The

is in session from 14th to 18th

general conference will be in session

September 2015.

from 14th to 18th September 2015.

India Newsletter • 5

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NEWS ARTICLES Middle-class wealth up 150% in India since 2000: report Growth in wealth creation by the middle class in India has outpaced the global average, but lags far behind the rate of expansion in China.

In India, middle-class wealth has grown 150% since 2000. Globally, it has doubled, according to the Global Wealth Report 2015 by Credit Suisse AG. China’s middle-class wealth grew a staggering 330% in the same period.

Global middle-class wealth is estimated at $80.7 trillion, as against $44.4 trillion in 2000.

“During the same period, middle class wealth in Asia Pacific has expanded by 70% to $27.2 trillion, by 102% in Africa and by 109% in Latin America. In India it has grown by 150%, while China has experienced a significant increase of 330%,” said the report.

The report defines the middle class in terms of a wealth band instead of an income range. It uses the US as the benchmark country, where a middle class adult is defined as having wealth between $50,000 and $500,000 at mid-2015 prices, while using the International Monetary Fund series of purchasing power parity (PPP) values to derive equivalent middle-class wealth bounds in local purchasing power terms for other countries.

Going by this definition, only 3% of India’s adult population falls in the middle class wealth category.

Total household wealth in India has grown at an average of 8% in domestic currency terms since 2000, the wealth report stated.

According to the report, between mid-2014 and mid-2015, household wealth rose 4.8%. In dollar terms, however, Indian household wealth fell 1% between last year and this year. Still, wealth per adult was just 6 • India Newsletter

$4,350 in 2015.

Most of the personal wealth in India, as in other emerging markets, continues to be in the form of property. Such assets make up 86% of gross household assets. Personal debt in India remains low at just $346, the report said.

At the top of the pyramid, the number of dollar millionaires in India is expected to rise by 65% over the next five years, in line with the increase projected across the Asia-Pacific region, according to the report. By 2020, 305,000 people in India will fall in the category, compared with 185,000 currently, it said.

Globally, the number of dollar millionaires will rise by 46.2%, with the steepest increases likely to be across the Asia-Pacific (66%) and Africa (73%).

“Overall, high-income economies will still account for the bulk of new millionaires, with 14 million adults entering this category in the next five years. Millionaire net wealth is likely to rise by 8.4% annually, as more people enter this segment.

Emerging markets will likely account for 9.1% of millionaire wealth in 2020, 1% above current levels,” the report said.

India now has 2,083 ultra-highnetworth individuals, with more than $50 million net wealth, 3% higher than in 2014.

India tops on investor confidence list: Bank of America Merill Lynch survey India’s policy measures, be it from RBI or the government, are finally catching the fancy of global investors as they are betting the most on India compared to other Asian peers, show a global survey

by Bank of America Merill Lynch conducted among 164 market participants.

Most investors from Asia Pacific exJapan region are now overweight on India, and see it as the most preferred investment destination.

“Asia Pacific ex-Japan investor views India moved back to being the market most investors would overweight in October, followed by China, while investors scaled back their Korea overweight views,” the survey said. “Sentiment for Taiwan reduced as it went from being the most favored market to a market weight position.”

Two weeks ago, RBI governor Raghuram Rajan reduced the borrowing cost more than what it was estimated. The government too has been doing its bit through liberal policy measures like public sector bank reforms, hiking investment limit for overseas investors.

Investors reduced their net underweight positions in Malaysia and Australia.

Surprisingly, Indonesia and the Philippines moved from net overweight positions to net underweight and neutral, respectively.

A recession risk in China has come down so compared to September, investors observed. China’s sluggish growth have been triggering investor concern across global markets as it affects global demand.

A majority of survey respondents believe, Chinese economy will see some improvement in the next 12 months and are also less bearish on China’s growth prospects (close to 70% of investors expecting 2018 GDP growth to be greater than 5% vs 40% last month), investors do not want exposure to EMs. So, what is the trade strategy?

The most crowded trades continue to be shorting EM equities, commodity stocks and EM FX as a challenging macro environment, a worsening earnings outlook, a strong US dollar and potentially higher bond yields continue to weigh on EMs.

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Industrial growth soars to 3-yr high of 6.4% in Aug Industrial growth rose to 6.4 per cent in August, a nearly three-year high, from 4.1 per cent in the previous month, on the back of resurgence in all segments — industry, mining and electricity generation, official data released on Monday showed.

Industrial growth had earlier touched high levels in October 2012, at 8.4 per cent. The high growth is expected to sustain at least till November, thanks to the festive season.

The growth, as measured by the Index of Industrial Production (IIP), might have come partly on a low base of 0.5 per cent in the same month of the previous year. Low growth in the same month a year ago showing relatively higher growth in the period under consideration is called low base effect.

However, the very fact that analysts polled by Reuters expected industrial output to grow 4.8 per cent in August implied there was some revival as well.

While the festive season runs till the middle of next month, the low base effect will run till the end of this month.

The revival in industrial growth comes at a time when policymakers are keeping their fingers crossed over high economic growth for the current financial year. The first quarter ended with only seven per cent GDP expansion, against 7.5 per cent in the previous quarter.

In the first two months of the second quarter, IIP rose at an average of 5.2 per cent. In the first quarter, industrial growth in volume terms had stood at 3.3 per cent.

According to the new methodology of calculating economic expansion, it is largely IIP that drives industrial growth in GDP numbers in the first three quarters.

All the three broad segments — manufacturing, mining and electricity — posted higher rate of growth in August compared to July.

Because of this, industrial growth

rose 4.1 per cent in the first five months of the current financial year against three per cent in the same month of the previous year.

Chief Economic Advisor Arvind Subramanian tweeted,“Encouraging news on Indian economy. IIP growth increased to 6.4 per cent, consistent with indirect tax revenue performance.”

While manufacturing growth climbed to 6.9 per cent in August from -1.1 per cent a year ago, mining saw an expansion of 3.8 per cent against 1.2 per cent and electricity recorded 5.6 per cent growth against 12.9 per cent in the year-ago period.

Although base effect resulted in a spurt in manufacturing and mining as the former contracted and the latter expanded only 1.2 per cent in August 2014, electricity managed to grow at a reasonable rate despite a huge growth in the year-ago period.

In terms of use-based category, capital and consumer durable goods pushed up industrial production.

While capital goods rose 21.8 per cent in August against 10.6 per cent in the previous month, consumer durables posted 17 per cent growth against 10.3 per cent.

“We suspect that the growth in consumer durables is also coming on the back of some pick up in urban consumption levels as already being shown by auto sales numbers,” said Rishi Shah, economist, Deloitte India.

However, consumer non-durable products saw an expansion of only 0.4 per cent, though not as bad as 4.6 per cent contraction in the previous month. Fast-moving consumer goods, which are still bogged down by the Nestlé Maggi noodles controversy, saw only marginal growth. Instant food mixes led to a 0.14 per cent fall in IIP, given its weightage of 0.13 per cent. In July, its negative contribution was 0.2 per cent. Bigger category of food products declined 4.5 per cent in August. As many as seven items of 22 industrial categories showed negative growth. The impact of surge in gold imports was clearly

evident in gems and jewellery production, which soared 192.3 per cent in August. In that month, gold imports jumped 140 per cent to $4.9 billion.

Going forward, Aditi Nayar, senior economist with ICRA, said inventory build-up ahead of the festive season should provide some sequential boost to output of manufactured goods, particularly consumer durables, contributing to a pickup in IIP growth in September 2015 relative to the 2.6 per cent growth in September 2014.

“A shift in the festive calendar would impact the number of working days in October and November in 2015 as compared to last year, introducing noise in the growth rates for the manufacturing and mining subsectors. In our view, a favourable base effect (2.7 per cent contraction in the IIP in October 2014) is likely to result in a temporary spike in IIP growth in October 2015,” Nayar said.

As many as five industrial categories showed contraction out of the total 22 in August, against 10 in July.

India better placed among emerging markets to tackle outflows: IMF’s Thomas Richardson India is better placed among emerging markets to tackle risks arising out of global economic slowdown, said a top IMF official, reaffirming an optimistic outlook despite some lingering concerns.

The Indian central bank along with its Chinese counterpart are the only ones better equipped to handle huge outflows, he said. “India is big in the global picture. We are bullish on the economy,” said Thomas Richardson, IMF Senior Resident Representative for India, Nepal and Bhutan. Richardson was in Mumbai to address students at the Meghnad Desai Academy of Economics.

“India is exposed to global risks, but much less than other emerging markets,” he said.

IMF, in its recently released report on the World Economic Outlook, India Newsletter • 7

Indian Embassy, Vienna

expressed concerns over the fallout of global economic slowdown on emerging markets and also the risks associated with global deflation.

Significantly, the statement comes within days of IMF lowering its growth forecast for this year to 7.3% from 7.5% earlier amid risks of a global slowdown. “India has been lucky with global commodity prices coming down. But also policy has a role to play,” said Richardson, underscoring many macro indicators such as lower current account deficit, easing of inflation, and a check on fiscal deficit.

Richardson praised Reserve Bank of India governor Raghuram Rajan’s policy initiatives that has helped the country build a sizeable foreign exchange reserves of over $350 billion in case there’s a pullout by foreign investors.

“Both RBI and the People’s Bank of China are armed with an insurance policy in the form of foreign exchange reserves,” he said, adding that only the Chinese and Indian central banks are prepared to deal with an eventuality of strong capital outflows (in case the US Fed hikes its policy rates). Besides, he also acknowledged Reserve Bank’s policy initiatives that has helped check consumer inflation.

But there are pitfalls, Richardson warned. The biggest among them are the corporate leverage and nonperforming loans in the banking sector which are dragging things down.

Besides, there are concerns about government finances as well.

Though the fiscal deficit is reined in, the combined government deficit is still high at 6.5 to 7% of GDP. This can be addressed by widening the tax base and implementing the goods and services taxes reforms, he said.

India climbs one rank with a 32% sprint in brand value India’s nation brand value has in 2015 increased by a whopping 32 per cent to $2.14 trillion, compared with $1.62 trillion last year, shows 8 • India Newsletter

a report by London-based Brand Finance, a leading independent brand valuation and strategy consultancy. Not only has India’s rate of increase been the highest among the top 10 by brand value, it has also helped the country improve its global ranking by a notch to seventh.

Only three Asian nations - China, India and South Korea - figure among the top 20 most valuable nation brands. Even as China has maintained its second position, it has lost one per cent of its value over a year to $6.3 trillion in 2015. South Korea has improved its ranking to 12th from 17th with a 10 per cent increase in value to $1.1 trillion.

Meanwhile, in a classic case of how one company’s mess can hurt a country, the recent crisis faced by automaker Volkswagen has not only affected Germany’s brand value but also cost it its position as the world’s strongest nation brand.

In addition to a four per cent erosion in brand value to $4.2 trillion, Germany, the third-most-valuable nation brand, has been replaced in the strongest nation brand pecking order by Singapore.

With its intolerance for corruption, generous wages for public officials to discourage graft, heavy tax on cars leading to less congestion and good public transport, and a high-quality education system, Singapore, which has a nation brand value of $412 billion, is now the strongest nation brand.

According to David Haigh, chief executive officer, Brand Finance, a nation brand is one of the most important assets for any state in a global marketplace, “encouraging inward investment, adding value to exports and attracting tourists”.

Though the US remains the most valuable nation brand in Brand Finance’s 2015 edition of Nation Brands report, the country’s image as the ‘Great Satan’ in Iran will affect the ability of its firms to export into Iran. The report says: “Those with a neutral and internationalist branding, such as Apple, should be

largely unaffected. But the more ‘all-American’ brands like CocaCola might struggle to overcome negative perceptions.”

In the case of the UK, there are even stronger negative associations with Iranians, many of whom resent the UK’s historical political interference in their country.

Germany and France, by contrast, were faster to reach out and had a more established presence in Iran before sanctions were imposed on that country. “France’s Peugeot was the market leader in the Iranian automobile market. However, its perceived abandonment of the country might mean other European firms are better placed to profit,” says the report.

Brand Finance measures the strength and value of 100 countries using a method based on the royalty-relief mechanism employed to value large companies.

The five-step approach includes preparing a brand strength index on the basis of goods and services, investment and society. The first is sub-divided into governance, market and tourism (for investment, tourism is replaced by people and skills).

It emphasises a six-step approach by governments to improve the nation brand through appraisal, macro and micro image, consistent and focused vision, brand strategy, market strategy and execution.

India’s “Incredible India” slogan, used for tourism promotion, has worked well as “an umbrella brand”, with more targeted and detailed campaigns appealing to the different audiences. “Who doesn’t want to discover something incredible? An overarching slogan or campaign could be used across the board,” says Courtney Fingar, editor-in-chief of fDi Magazine, which has partnered Brand Finance for this year’s Nation Brands study.

The strength of Germany’s nation brand has traditionally come from its manufacturing prowess. However, recent revelations that Volkswagen might have fitted 11 million diesel

Indian Embassy, Vienna

vehicles with software designed to deceive emission testers, has dealt “a hammer blow” not only to the company’s reputation but potentially also to Germany’s nation brand.

The study says German industry is known for its efficiency and reliability, and its people are seen as hard-working, honest and law-abiding - the Angela Merkel government’s approach to the Greek debt crisis has only intensified the perception.

“This (Volkswagen) scandal threatens to undo decades of accumulated goodwill and cast aspersions over the practices of German industry, making the earlier Siemens bribery scandal appear less a one-off bad apple than evidence of a broader malaise.

Despite the vast scale of deception, other companies will need to be implicated before the damage to Germany’s nation brand becomes critical.”

Its receptivity to migrants from Syria will generate more than just goodwill for Germany’s nation brand. The influx of generally young people will provide a fillip to its labour force, especially since the country’s birth rate has been flagging. “The desire of migrants to reach Germany and to a less extent Sweden speaks to the existing strength of these powerful nation brands,” says the report.

Interestingly, Iran tops the list of best-performing nation brands; the value of its nation brand value has increased 59 per cent over a year ago to $159 billion. Iran is followed

by Cameroon, Tanzania, Kenya and Zambia in high rates of increase.

The report says Hassan Rouhani’s moderate approach is slowly shifting the international perception of Iran’s potential.

“The conflict on its doorstep and the Sunni-Shia divide will remain an impediment to trade and investment locally but with a market of 77 million people, vast hydrocarbon reserves and a highly educated population, Iran certainly

has a receptive audience globally,” says the report.

Ukraine and Russia, rivals in political arena, are together in the worstperforming nation brand category, at first and third spots, respectively.

Russia’s brand value, at $810 billion, is more than 60 per cent lower than India’s..

Ford goes beyond Make in India, will Design in India Global automobile companies Mercedes and BMW have been gung-ho on the government’s ‘Make in India’ initiative. Now, American carmaker Ford is giving Indian automobile manufacturing a new dimension — its India subsidiary is considering designing a new vehicle in the country.

The move will make Ford the first global automobile major to design a vehicle here. Typically, global carmakers with a manufacturing base in India collaborate with their global research teams.

Ford, it is learnt, will design the new Fiesta (to replace the existing one) at its research and development and engineering facilities in Chennai.

The product, which will cater to the domestic and export markets, is expected to be launched in 2017.

When asked about the plans, Ford India President Nigel Harris said, “I can’t confirm or deny it. We are not talking about it. We will tell you all about it next year.”

Last month, the company had said it would enhance investment in India for capacity expansion at the Chennai plant and the establishment of a new global engineering and technology centre. “India is at the centre of innovation at Ford and we are delighted to strengthen our presence with a new global engineering and technology centre,” Dave Schoch, president of Ford AsiaPacific, had said. “With these latest investments, we are making rapid progress in our vision of driving innovation from India to the world.”

Besides the engineering and technology centre, the new Ford

campus will also host operations of Ford Global Business Services in the areas of IT, product engineering, data analytics and manufacturing, among others.

“This reflects the level of confidence global automakers have in Indian capabilities. Until now, India was known for manufacturing excellence and low-cost sourcing. A move by global automakers such as Ford to use India as their design centre will certainly enhance the nation’s ranking in global automobile manufacturing,” said Amit Kaushik, country head (India) at JATO Dynamics, a UK-based automotive research firm.

With two manufacturing facilities in India, Sanand and Chennai, Ford is already showcasing Indian automobile manufacturing at a global scale by exporting about 60 per cent of the vehicles produced.

Vehicles and engines made at these plants are exported to 45 countries, and the list continues to expand.

The company shipped 81,703 passenger vehicles in FY15. In the first five months of this financial year, the company has exported 41,667 vehicles, 28 per cent more than in the year-ago period.

■■ FORD’S PLAN FOR INDIA ■■ Ford will design the new Fiesta (to replace the existing one), a sedan at its R&D and engineering facilities in Chennai ■■ Ford will enhance investments in India for capacity expansion at the Chennai Plant and the establishment of a new global engineering and technology centre ■■ The new Ford campus will host operations of Ford Global Business Services in areas of IT, product engineering, data analytics, manufacturing among others ■■ Ford shipped 81,703 passenger vehicles last financial year and was the country’s fourth largest exporter ■■ In the current financial year, the company exported 41,667 vehicles, growing 28 per cent over same period last year India Newsletter • 9

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India and Germany Sign Agreements for Furthering Cooperation in the Field of Science & Technology India and Germany have signed agreements for furthering cooperation in the field of Science & Technology. The Union Minister for Science & Technology and Earth Sciences Dr. Harsh Vardhan and the German Federal Minister for Education and Research Ms. Johanna Wanka signed the main agreement and witnessed signing of another agreement by the officials for the purpose after mutual discussions in New Delhi.

At the meeting held before the 3rd Indo-German Consultative meeting, both the Ministers expressed their satisfaction on the level of IndoGerman Science & Technology cooperation which is now recognised as one of the strategic pillars in the overall bilateral relationship.

It was reiterated by both sides that they would continue to support and strengthen the basic research component of collaboration which will underpin future technology developments.

India is investing approximately 14 million euro for the construction of an additional beam line and access to the synchrotron facility at PETRAIII in DESY at Hamburg. Similarly, India is equity share holder with investment of 36 million euro in the construction of the international “Facility for Antiproton-Ion Research” (FAIR) at Darmstadt. Both these state of art facilities will further enable our scientists to conduct high impact and frontier research in material science, nuclear and high energy physics. On the same model, Dr. Harsh Vardhan offered Germany to participate in some of the future mega science projects, which India will be embarking upon.

A major highlight of the meeting was the agreement on both sides to extend the bi-national IndoGerman Science & Technology Center (IGSTC) beyond 2017 with increase in funding from 2 million 10 • India Newsletter

euro to 4 million euro every year.

This was a reflection of the common endeavour on both sides to support industrially relevant R&D projects that have potential to generate novel technologies and new intellectual property in sectors such as advance manufacturing, embedded systems & ICT for automobiles, renewable energy, food security, clean water and health care technologies- all of which are in tune with present national missions of the government of India. India is the only country with whom Germany has such a bilateral R&D Centre dedicated to promote applied and industrial R&D. The Centre is already supporting 15 joint projects and pro-types of some new technologies have been co-developed in solar-thermal energy, stress tolerant chic-pea variety, and high altitude cold resistance plants etc.

Dr. Harsh Vardhan expressed confidence that the extended tenure of Indo-German Science & Technology Centre (IGSTC) until 2022 along with doubling its financial resources will enable us to co-develop affordable technologies that can contribute to the knowledge economy of both our countries.

Both the Ministers reiterated the need for concerted effort to promote exchanges of young scientists and student researchers. To this end DST through a Letter of Intent agreed to continue the support for participation of 25 Indian science and medical students to the annual Nobel Laureate meet in Lindau.

Both the Ministers echoed that the future cooperation should focus on programs to promote innovation and techno-entrepreneurship by linking the SME and Start-up enterprises of both the countries in order to make meaningful contribution to the knowledge economy and use the tools of science and technology to address socially relevant challenges. New areas such as anti-microbial resistance and regenerative medicine, earth science system including monsoon studies and marine sciences required to understand the climate change process was emphasised

by the Indian side that needs to be addressed together.

Angela Merkel signs key business deal with India’s Narendra Modi India and Germany have signed a deal to fast-track approvals to make it easier for German firms to operate in India.

The deal was agreed during German Chancellor Angela Merkel’s talks with Indian Prime Minister Narendra Modi on the opening day of her visit to India.

Mr Modi visited Germany in April where he sought to convince more industries to begin manufacturing in India.

Last year, he launched the “Make in India” campaign to boost manufacturing at home and create millions of jobs.

Chancellor Merkel, accompanied by a large delegation of ministers and senior officials, arrived in the Indian capital on Sunday night and was accorded a ceremonial welcome at the Presidential Palace on Monday morning.

Her talks with Mr Modi centred around ways to deepen bilateral engagement in diverse sectors like defence, security, education and renewable energy, besides trade and investment.

Addressing a joint press conference along with Mr Modi, Chancellor Merkel said 1,500 German companies were already working in India and the fast-track agreement would help them.

“We are enhancing cooperation in science, technology and vocational fields”, she added.

The fast-track approvals process will cut bureaucratic hurdles to ensure ease of business for German firms, Indian officials say.

Mr Modi said Germany had agreed to provide more than 2bn euros ($2.25bn; £1.48bn) in assistance to India to develop a clean energy corridor and solar projects.

India, the world’s third largest

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carbon emitter, has pledged to the UN to reduce the rate by which its greenhouse gas emissions increase by up to 35% by 2030, compared with 2005 and has said that it aims to generate 40% of electricity from non-fossil fuel sources, mainly solar and wind.

“I admire German leadership in clean energy and commitment to combating climate change,” Mr Modi said.

The two leaders also discussed terrorism, defence, arms cooperation and the stalled free trade agreement negotiations between India and the European Union which, if implemented, will boost bilateral commerce.

Ms Merkel is also visited the southern city of Bangalore to attend a business meeting.

India up 16 spots to 55th in global competitiveness India has jumped 16 places on the Global Competitiveness Index, according to the latest rankings released by the World Economic Forum (WEF). It now ranks 55th among 140 countries, against 71st in 2014-15.

But, despite this massive jump, which follows five years of a decline on the list, India still ranks seven notches lower than it did in 2007.

Switzerland tops the latest rankings, followed by Singapore, the US, Germany and Netherlands.

The WEF report attributes the jump in India’s ranking “to the momentum initiated by the election of Narendra Modi, whose pro-business, progrowth, and anti-corruption stance has improved the business community’s sentiment towards the government”. The report, however, says if a constant sample of 135 countries is considered for both 2014-15 and 2015-16, India’s ranking would remain unchanged at 55th.

The Global Competitiveness Index is an annual assessment to gauge the factors driving productivity and prosperity across 140 countries. It measures a country’s performance on 12 pillars -institutions,

infrastructure, macroeconomic environment, heath and primary education, higher education and training, goods market efficiency, labour market efficiency, financial market development, technological readiness, market size, business sophistication and innovation. The World Bank’s ease-of-doing-business survey ranks India at 142. The government has repeatedly promised to implement reforms to push the ranking to within the top 50.

The latest WEF rankings show India’s institutions are now “judged more favourably” (ranked 60th against 70th in 2014-15). The report says in terms of trust in politicians, India ranks 31st, while on favouritism in the decisions of government officials and burden of government regulations, it ranks 32nd and 27th, respectively.

A big improvement was seen in the country’s macroeconomic stability through the past year, with its ranking jumping 10 places to 91st in 2015-16. Part of this could reflect the recent moderation in inflation, the fall in the current account deficit and steps taken by the government to control its fiscal deficit.

On infrastructure, the ranking moved up six notches - now, it ranks 29th on the quality of railroad infrastructure and 11th on the available airline seats per km. But on other key parameters, it fares poorly, ranking 61st on the quality of roads and 98th on electricity supply.

The WEF report is rife with anomalies.

Health and primary education is seen as an area of improvement, with India’s ranking jumping 14 places. This is surprising, as on one of the indicators - quality of primary education - it ranks 52nd, which is at odds with various surveys such as the Annual Status of Education Report that show how poorly the country fares in this regard.

Another surprise is India ranks 25th on hiring-and-firing practices in the labour market, a sharp contrast to public discourse in India that sees restrictive labour laws as thwarting growth in the manufacturing sector.

The report lists corruption, policy instability, inflation, access to financing, government instability and inadequate supply of infrastructure as the top concerns in terms of doing business in India.

Top executives of tech giants pledge support for Digital India initiative Top executives of global information technology giants Google Inc., Microsoft Corp., Qualcomm Inc., Adobe Systems Inc. and Cisco Systems Inc. said they are keen to join hands with India and deepen their participation in the Digital India initiative that aims to ensure that government services are available to citizens over the Internet.

The chief executives of the top technology firms were speaking at a Digital India forum in San Jose, California during Prime Minister Narendra Modi’s visit to the US. “India has more than 300 million Internet users and smartphone users.

People are educating themselves and their loved ones how to use technology,” said Sundar Pichai, chief executive, Google. “India is coming online at an unprecedented pace.”

“I can feel the change in the air,” he said.

“I am excited about technology, and India will play a big part in its future.”

He also said India has become the fastest growing start-up nation.

Paul Jacobs, executive chairman of Qualcomm, told the forum that his semiconductor company is keen to promote the Digital India vision. “To promote ICT (information communication technology) in India, we will be setting up a $150 million fund to fuel innovation and foster promising Indian startups who are contributing to the mobile and ‘Internet of Everything’ ecosystem.”

“In line with the Make in India initiative,” he added, “the company will set up design centres in India to design products from India for the world.”

Microsoft chief executive officer Satya Nadella said the company is looking to bring low-cost Internet in India Newsletter • 11

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India. “We want to help people make things and make things happen. It is time to collectively combine efforts to empower the people,” he said.

The company worked with researchers to bring low-cost Internet infrastructure to rural Andhra Pradesh using television’s white spaces, he said. “We are now looking to replicate the same pilot project in Varanasi.”

“We are in talks with state governments to expand it in 5,000 villages,” he added.

Modi, in his address, thanked the companies for their initiatives.

“We will see the perfect picture of US-India partnership emerge in the digital economy,” he said adding it is a new era of empowerment where global firms are creating infrastructure and services to support the government with the Digital India initiative.

“Technology is empowering people,” Modi said. “We are attacking poverty with network and smartphones.”

“In the digital age, we have the opportunity to transform the lives of people. About 170 e-governance applications are there to make government services available in better and faster way,” he added.

Stressing on the role of social media in empowering citizens, Modi said, “Facebook, Twitter, Instagram have become the new neighbourhoods.

Social media has turned everybody into a reporter.”

Briefing reporters later, foreign ministry spokesman Vikas Swarup said Modi had invited Apple to set up a manufacturing base in India.

“The Prime Minister (in his meeting with Cook) said he would like Apple to start manufacturing in India. He mentioned the huge opportunities India offered,” Swarup told reporters.

Taiwan-based Foxconn Technology Group, which is the largest manufacturer of Apple products, has already decided to set up a manufacturing base in India, Swarup said. “Cook responded positively. I think India does fits into his long term plans. He particularly 12 • India Newsletter

was interested in the whole app development economy, which he said could be a very, very important factor for entrepreneurship where individual app developers can just become part of the app universe,” Swarup said.

There was also some discussion on how Apple Pay could be a part of India’s financial inclusion Jan Dhan Yojana and other such initiatives, he added.

Indian ambassador to the US, Arun Singh, told reporters that during the Modi-Cook meeting “there was a sense that a lot of design innovation is happening in India.”

“As Apple expands its presence in India, including a manufacturing presence there could be enhanced opportunity for app development related to the apple platforms,” he said.

During the meeting, Cook is said to have recalled how Apple co-founder and former CEO Steve Jobs came to India as a young man seeking inspiration.

India received $19.78 billion in FDI from countries PM Narendra Modi visited When the PM travels to the US this week to woo businesses there, one of the key facts that the government will be tomtoming about is the surge in foreign direct investment since Narendra Modi took over and how his personal touch has helped.

India received $19.78 billion (Rs 1.3 lakh crore) in FDI in 2014-15 from a dozen major FDI source countries that Modi has visited since taking over in May last year. This accounts for nearly two-thirds of the $30.93 billion FDI the country received in the fiscal year, which was 27 per cent more than the year before.

FDI grew quicker after the launch of the Make in India programme in September 2014 — inflows jumped 48 per cent between October 2014 and April 2015 over the year-earlier period, data from the Department of Industrial Policy and Planning showed.

Modi will be reaching New York on Wednesday evening and is scheduled to meet top business

honchos. The visit is coming at a time when cynicism is growing about the government’s ability to introduce and implement reforms as promised.

“There has been some questions about the Modi government’s performance when it comes to pace of reforms and ease of doing business,” a foreign diplomat in Delhi said. But a government official from Japan, one of the countries that Modi visited and from where he got a huge investment commitment, told ET there was no major reason to be upset about since Modi became the PM. While some criticise his frequent foreign visits, others say those trips have helped boost India’s image as an investment destination. “Foreign firms had switched off India in the last couple of years (of the previous government) but they have been upbeat in the past year,” said ex-CII mentor Tarun Das. “Modi has been able to integrate foreign policy with economic and corporate policies. India is emerging as the apple of everybody’s eye as other BRICS economies are witnessing downslide,” he told ET. “A big change has been brought in the approach towards foreign investors by the PM deciding to meet individual CEOs of global business giants. When domestic investments are constrained and Indian banks have huge NPAs, FDI is key to boosting economy.” A concern that Das has is on the tax regime, which he said needs to be simplified for securing more FDI. Among the countries that Modi visited, Japan has committed to invest about $35 billion in five years and South Korea about $10 billion. China has assured $20 billion in the next five years, while France has announced $2 billion euros ($2.26 billion). The UAE, which the PM visited last month, has assured to pump in money for India’s $75-billion infrastructure fund. The UK has launched a programme for investments here ahead of Modi’s planned trip in November and Germany is expected to make some announcements related to the Make

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MAKE IN INDIA Summary ■■ 5th largest power generation portfolio.

■■ 5th largest wind energy producer.

■■ 1,500 MW annual PV(photo volatics) capacity by the end of 2014.

■■ 243 GW of installed capacity as of March 2014.

■■ 20,000 MW of solar power by 2022.

Reasons to Invest ■■ India has the fifth largest power generation portfolio worldwide with a power generation capacity of 245 GW. ■■ Economic growth, increasing prosperity, a growing rate of urbanization and rising per capita energy consumption has widened access to energy in the country.

■■ Current renewable energy contribution stands at 31.70 GW of the total installed capacity of 245 GW in the country as on 31.03.2014.

■■ Wind energy is the largest renewable energy source in India.

The Jawaharlal Nehru National Solar Mission aims to generate 20,000 MW of solar power by 2022, creating a positive environment among investors keen to tap into India’s potential.

■■ The country offers unlimited growth potential for the solar photovoltaic industry.

Statistics ■■ India is endowed with vast potential for solar energy and is rapidly emerging as a major manufacturing hub for solar power plants. It is expected that the annual PV-installed capacity will grow at a CAGR of around 49.5% between 2010 and 2014 to reach 1,500 MW by the end of 2014.

■■ Wind energy accounts for nearly 70% (21.1 GW) of installed capacity, thereby making India the world’s fifth largest wind energy producer.

■■ The Government of India has set a capacity addition target of 30 GW, which will take the total renewable capacity to almost 55GW by the end of 2017. This includes 15 GW from wind power, 10 GW from solar power, 2.9 GW from biomass power and 2.1 GW from small hydro power.

Growth Drivers ■■ India is the fourth largest importer of oil and the sixth largest importer of petroleum products and LNG globally. The increased use of indigenous renewable resources is expected to reduce India’s dependence on expensive imported fossil fuels.

■■ The government is playing an active role in promoting the adoption of renewable energy resources by offering various incentives, such as generation- based incentives (GBIs), capital and interest subsidies, viability gap funding, concessional finance, fiscal incentives etc.

■■ The National Solar Mission aims to promote the development and use of solar energy for power generation and other uses, with the ultimate objective of making solar

energy compete with fossil-based energy options.

■■ The objective of the National Solar Mission is to reduce the cost of solar power generation in the country through long-term policy, large scale deployment goals, aggressive R&D and the domestic production of critical raw materials, components and products.

■■ Renewable energy is becoming increasingly cost-competitive compared to fossil fuel-based generation.

■■ Wind energy equipment prices have fallen dramatically due to technological innovation, increasing manufacturing scale and experience curve gains.

■■ Prices for solar modules have declined by almost 80% since 2008 and wind turbine prices have declined by more than 25% during the same period.

■■ The government has created a liberal environment for foreign investment in renewable energy projects. The establishment of a dedicated financial institution – the Indian Renewable Energy Development Agency, makes for India Newsletter • 13

Indian Embassy, Vienna

renewed impetus on the promotion, development and extension of financial assistance for renewable energy and energy efficiency/ conservation projects.

FDI Policy ■■ Foreign Direct Investment (FDI) up to 100% is permitted under the automatic route for renewable energy generation and distribution projects subject to provisions of The Electricity Act, 2003.

Sector Policy ■■ GUIDELINES FOR GREEN LARGE-AREA DEVELOPMENTS BY MNRE: ■■ These guidelines cover various fiscal and promotional policies for the development of wind energy, which accounts for 69% of installed capacity.

■■ The package of incentives (except wind) includes fiscal concessions such as 80% accelerated depreciation, concessional custom duty for specific critical components, excise duty exemption, income tax exemption on profits for power generation etc. in wind power projects.

■■ THE PROVISION OF CENTRAL FINANCIAL ASSISTANCE FOR SMALL/ MICRO HYDRO-POWER PROJECTS: ■■ The MNRE is providing central financial assistance to set up small/ micro hydro projects both in the public and private sectors. Support is also given t o state governments for the identification of new potential sites, including surveys, the preparation of detailed project reports and the renovation and modernization of old projects.

■■ THE SETTING UP OF THE SOLAR ENERGY CORPORATION OF INDIA: ■■ The mandate of the Solar Energy Corporation of India (SECI) allows wide-ranging activities to be undertaken with an overall view to facilitate the implementation of the National Solar Mission and the achievement of targets set 14 • India Newsletter

therein. The SECI has the objective of developing solar technologies and ensuring inclusive solar power development throughout India.

■■ THE ANNOUNCEMENT OF THE OFFSHORE WIND ENERGY POLICY: ■■ To promote deployment of offshore wind farms up to 12 nautical miles from coast.

■■ To promote investment in energy infrastructure.

■■ To promote spatial planning and management of maritime renewable energy resources in the exclusive economic zone.

■■ To achieve energy security and reduce carbon emissions.

■■ To encourage indigenization of offshore wind energy technology.

■■ To promote R&D in the offshore wind energy sector.

■■ STATE INITIATIVES: ■■ State Electricity Regulatory Commissions in Andhra Pradesh, Haryana, Punjab, Madhya Pradesh, Maharashtra, Rajasthan, Tamil Nadu, Gujarat, Kerala, Punjab, Orissa and West Bengal have announced preferential tariffs for purchase of power from wind power projects.

Financial Support ■■ KEY PROVISIONS IN BUDGET 2O14-15: ■■ Allocation of INR 5 Billion towards the proposed ultra-mega solar power projects in Rajasthan, Gujarat, Tamil Nadu and Ladakh in J&K which includes an allocation of INR 4 Billion for launching a scheme for solar power driven agricultural pump sets and water pumping stations for energizing 100,000 pumps and a future allocation of INR 1 Billion for the development of 1 MW solar parks on the banks of canals.

■■ Excise duty is being reduced from 12% to NIL on forged steel rings used in the manufacture of bearings of wind-operated electricity generators.

■■ Full exemption from excise duty is being provided for solar tempered glass used in the manufacture of

solar photovoltaic cells/modules, solar power generating equipment/ system and flat plate solar collectors.

■■ Full exemption from excise duty is being granted in respect of machinery, equipments etc. required for setting up of solar energy production projects.

■■ Full exemption from excise duty is being provided to backsheet and EVA sheet used in the manufacture of photovoltaic cells/modules and specified raw materials used in their manufacture.

■■ Full exemption from excise duty is being provided to parts consumed within the factory of production for the manufacture of non-conventional energy devices.

■■ Full exemption from excise duty is being provided on flat copper wire used in the manufacture of PV ribbons (timed copper interconnect) for use in the manufacture of solar cells/modules.

■■ Full exemption from excise duty is being provided on machinery, equipment etc. required for the setting up of compressed biogas plants (Bio-CNG).

■■ Basic customs duty is being reduced from 10% to 5% on forged steel rings used in the manufacture of bearings of wind-operated electricity generators.

■■ Full exemption from SAD is being provided on parts and components required for the manufacture of wind-operated electricity generators.

■■ Basic customs duty on machinery, equipments etc. required for the setting up of solar energy production projects is being reduced to 5%.

■■ Full exemption from basic customs duty is being provided on specified r aw materials used in the manufacture of solar back sheet and EVA sheet.

■■ Full exemption from basic customs duty is being provided on flat copper wire used in the manufacture of PV ribbons (timed copper interconnect) f or solar PV cells/modules.

■■ Concessional customs duty of

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5% is being provided on machinery, equipment etc. required for the setting up of compressed biogas plants.

■■ INCENTIVES OFFERED BY THE GOVERNMENT FOR THE DEVELOPMENT OF THE SOLAR ENERGY SECTOR INCLUDE: ■■ Exemption from excise duties and concession on import duties on components and equipment required to set up a solar plant.

■■ A 10-year tax holiday for solar power projects.

■■ Wheeling, banking and third party sales, buyback facility by states.

■■ Guaranteed market through solar power purchase obligation for states.

■■ GBI schemes for small solar projects connected to a grid below 33KV. ■■ Reduced wheeling charges as compared to those for conventional energy.

■■ Special incentives for exports from India in renewable energy technology under renewable sectorspecific SEZ. ■■ A payment security mechanism to cover the risk of default by state utilities/discoms.

■■ A subsidy of 30% of the project cost for off-grid PV and solar thermal projects.

■■ Loans at concessional rates for off-grid applications.

■■ FISCAL INCENTIVES FOR BIOMASS POWER PROJECTS: ■■ Accelerated depreciation: a claim of 80% depreciation in the first year for certain specific equipment.

■■ A 10-year income tax holiday.

■■ Concessional customs duty and excise duty exemption for machinery and components during the setting up of the project.

■■ An exemption of sales tax in certain states.

■■ Financial assistance from IREDA for the setting up of biomass power and bagasse co-generation projects.

■■ FISCAL INCENTIVES FOR SMALL HYDRO POWER PROJECTS: ■■ Preferential tariffs.

■■ Central financial assistance to the state government and the private sector for the setting up of small/ mini hydro projects.

■■ A subsidy to upgrade watermills and thereby improve their efficiency.

■■ Custom duty concessions.

■■ A 10-year tax holiday.

Investment Opportunities ■■ From barely 20 MW in 2011, India’s installed solar capacity h as increased to 1,686 MW at the end of 2013.

■■ India has vast untapped renewable energy resources — wind energy has installed capacity of 21.1 GW and an estimated potential of 102.8 GW.

■■ Small hydro has installed capacity of 3.8 GW and an estimated potential of 19.7 GW. ■■ Bio-power (including biomass and bagasse co-generation) has an installed capacity of 4.1GW as opposed to an estimated potential of 22.5 GW. Solar power has installed capacity of 1.7 GW against the potential of 6 GW. ■■ The Solar Policy of Rajasthan notified in 2011 envisages the setting up of solar manufacturing facilities at proposed solar parks.

■■ The Gujarat Solar Park also makes special provisions for encouraging on-site manufacturing facilities to provide equipment to projects coming up within the park as well as adequate repairs, maintenance and skilled manpower to service projects within the park.

Foreign Investors ■■ Suzlon ■■ Enercon ■■ Vestas ■■ RRB ■■ NEG ■■ Micon ■■ Applied Materials (USA)

Agencies ■■ The Ministry of New and Renewable Energy ■■ The Indian Renewable Energy Development Agency

India Newsletter • 15

Indian Embassy, Vienna

PERSPECTIVES ON INDIA Journey of a Made in India brand

by Akshay Bector, Chairman and MD, CREMICA Food Industries Ltd. The CREMICA group was established in 1978 by Mrs. Rajni Bector turning her passion for Ice Cream making (also her hobby) into a small backyard enterprise. In the course of the past two decades, the CREMICA group has established itself as a huge food products conglomerate, leading the food processing business through its range of products like Ketchup, Bread Spreads, Mayonnaise, Desserts etc. its internationally certified production facilities, the consistency of its quality, and its unmatched expertise in the industry.

It will not be out of place to mention here that Cremica is an approved supplier to one of the World’s leading FMCG brands. Cremica is fast becoming a household name in India. Its vast array of products has been carefully selected to provide the best food processing industry has to offer. Today, Cremica is known for its unique recipes, health oriented ingredients and state- ofthe art standards.

With a career spanning more than 15 years in food business, we have been instrumental in the company’s exponential growth as a modern food processing company. With our business acumen and joint ventures, we steered the company’s fortunes with increased business volumes while building on the foundation of quality service and customer focus.

Cremica Food has strived to maintain the passion and today the group operates India’s largest tomato ketchup line and is the country’s largest producer of ketchup portion packs capable of packing 2.5 million sachets per year! These high quality products have made a mark and are even exported to Europe Africa, Middle East, US and Australia.

In the next 3 years, we are aiming for Rs 1000 crore turn-over by 16 • India Newsletter

2020. We are looking at entering new product categories and also increase our distribution reach.

Cremica Food Industries is looking at ramping up its distribution network to 1,00,000 outlets in the three years from 15,000 at present.

To expand manufacturing capacity, the company plans to invest Rs. 200 crore in the next three years to set up a food park manufacturing plant in Himachal Pradesh.

Road ahead for e-commerce in India Deepankar Biswas, CEO and CoFounder, Offergrid.

Yes. It is unprecedented and it’s a phenomenon. We are probably at the surface right now with the e-commerce juggernaut proliferating at a very fast pace.

Rediff Shopping, Indiaplaza Shopping were there in early 2000 also, but it was never a revolution.

This is the second avatar or rather E-Commerce 2.0 when all the chords have struck together to pave the foundation for a new and vibrant economy.

I strongly believe, the way forward would be hinging on the understanding of “how e-commerce is perceived by the generation having the most purchasing power”, which would be the folks born in 1970s, 80s and 90s now (as in 2015), lets call them Generation A and slowly shifting to folks who are born in 2000 – 2015 whom we can call as Generation B and then, the ones who would get born in 2015 and beyond, whom we can call as Generation C. Generation A would fuel the ecosystem pillars and build a definition for e-commerce. A lot of support industries would be created and largely a full working and repeatable model will develop in the next five years. Generation A will make the purchases and establish faith in the system (as its already

happening around us). Since this generation has understood and seen the Internet appearing as a concept from no-where, desktop, tablet and mobile would be the form factors instrumental in shaping e-commerce for the next 5-10 years.

Generation B is currently seeing it all develop. All excited and fancied by the super convenience, it understands the Internet through tablets and mobiles first than the desktop. It is acting as an influencing generation in this process and would largely setup the content and products in e-commerce. It would build the potential and the very reason for e-commerce to surge ahead faster.

Generation C is currently a generation which is in its infancy right now. Imagine the first lens through which they see e-commerce and Internet in general would be “how”? Wearables / IoT / Drone Internet? It’s difficult to fathom right now. By the time, this generation is ready to engage – e-commerce would be prevalent as a way of life and not a surprise or an experiment.

Given this conditioning, E-Commerce has a long way to go. It is not only the “e”, that would grow, but the actual commerce will positively impact supply chain and logistics network, payments, technologies on the mobile, advertising, and marketing. It’s an undeniable transformation, which we would be experiencing.

On a global scale, the Indian revolution of e-commerce would not fall short of impacting the global economy. Local players would compete on a global scale and that would significantly drive innovation & the influence of India on regional economies and largely over the world.

From a consumer standpoint, he would be the biggest beneficiary.

Access to a virtual large mall at any point in time, at any point of access

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is a huge plus from a convenience

800 million, according to a recently

Cleartrip,

and quality of life perspective. There

released report from ICRA. In fact, it

continue to dominate the travel

would be a longing for the middle

is the area of online hotel bookings

bookings industry on the internet,

class to be an upper middle class,

that holds one of the largest growth

online accommodation reservation

and the lower middle class to come

potential within the sector. The

services like Oyo Rooms, Stayzilla

up on the rung.

With the digital

report from ICRA also mentioned

are gaining popularity. In addition,

India and positive efforts from the

that hotel bookings is one of the

meta search engines like TripAdvisor

government, the rural India would

least penetrated segments within

and Kayak, that operate like travel

undergo a transformation as well.

the travel categories in India and

discovery platforms have been able

We have not reached a tipping point

online bookings account for 16 per

to establish presence in the Indian

cent of the hotel bookings currently.

market and this segment is also

The number is expected to grow

expected to attract competition in

to 25 per cent in 2016. In other

coming times.

words, around 8.4 million Indians

With

are likely to book hotels online by

accommodation booking services

2016, up from 3.5 million in 2014. It

starting loyalty schemes, its market

is important to note here that 70 per

share compared to the direct

cent of the hotel rooms are booked

bookings channels from branded

through online booking portals in

hotels is expected to improve

Europe and around 35-40 per cent

drastically. Overall, the Indian hotel

Ravi Capoor, IAS, Chief Executive

in USA.

industry is expected is register a

Officer, IBEF.

The

of

huge surge in online bookings and

The Indian hotel industry is all set

internet usage and smartphones in

the low penetration levels coupled

to enter the next phase of growth

India has led to increased booking

with the increasing smartphone and

on the back of untapped growth

of hotels through online portals

internet usage is expected to turn

potential. The industry is estimated

and applications in recent times,

into a big opportunity for home-

to touch US$ 1.8 billion by 2016,

the report added. While online

grown start-ups and international

up from a current total size of US$

travel

brands alike.

yet. With over 700 million people in India, yet to come online and shop, the e-commerce behemoth is waiting to be discovered to the fullest.

Indian hotel industry: Online bookings to double by 2016

deepening

agents

penetration

like

Makemytrip,

Yatra

OTAs

and

and

Goibibo

online

INDIA PERSPECTIVES MAGAZINE ONLINE

www.magzter.com/publishers/meaindia

India Newsletter • 17

Indian Embassy, Vienna

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 maoffice.vienna@mea.gov.in to get more information about possible assistance/subsidies.

18 • India Newsletter

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India Newsletter • 19

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20 • India Newsletter

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India Newsletter • 21

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T

he Council for Leather Exports (CLE), India is pleased to invite you to the 19th International Technical Footwear Congress of the International Union of Shoe Industry Technicians (UITIC) to be held during February 3rd to 5th 2016 in Chennai, India.

The UITIC has been a pioneer in the dissemination of technical developments and knowledge in the footwear industry by facilitating information exchanges between its members. UITIC’s main activity is to organize an International Technical Footwear Congress which addresses the latest technical issues and problems.

The Council for Leather Exports (CLE)-India is the Apex body for the international promotion and overall development of the Indian

T

he Medical electronics industry has witnessed a double digit growth in recent years and this growth trajectory is expected to continue due to the rising incidence of chronic diseases, increased urbanization and a growing elderly population and increased awareness about latest technology solutions to save augment life and rehabilitation.

The influx of Medical Electronics technology has also reinforced the existing Healthcare infrastructure in various ways right from digitizing medical test, diagnostic 22 • India Newsletter

Leather & Footwear sectors, and will host the 19th UITIC Congress. The Congress will be held in Chennai, capital of Tamil Nadu State which is home to some of the leading footwear clusters of India.

The Theme of the 19th Technical Footwear Congress is “Future Footwear Factory”. Advances in technology, design and information sciences have enabled the modernization of factories for producing footwear with advanced properties, making optimum use of resources. However there remains the perennial challenge of changing consumer demands and market vagaries. Also, today’s instantlyconnected world has ushered in a plethora of opportunities and challenges. Footwear factories have to adapt and improvise to

stay ahead in this dynamic scenario.

The 19th UITIC Congress aims to bring together technical experts, manufacturers, and stake holders of the Footwear industry, for a period of intense deliberations on the theme.

The long running and well-known India International Leather Fair (IILF), Chennai will take place on contiguous dates during January 31 – February 3 2016; adding further value to participation in the UITIC Congress.

The 19th UITIC Congress, Chennai is now open for Delegate Registrations We also invite papers of Technical Merit and relevant to the Theme of the Congress for selection for Oral and Visual presentations at the Congress.

and therapeutic procedures to Manufacturers to showcase their enhancing the reach of Healthcare products and technology to the through Telemedicine and Health IT. Indian and International Business India Medical Electronics Expo 2016 Visitors from the Healthcare sector. which is being jointly organized by the Department of Pharmaceuticals, The Indian Medical Electronics Ministry of Chemicals & Fertilizers industry is currently valued at and Federation of Indian Chamber around 1 billion and has been of Commerce & Industry from 7th- growing at an average rate of 9th January, 2016 at Bangalore 17% for past couple of years. It is International Convention and strongly believed that growth will Exhibition Centre, Bangalore will outperform the pace, resulting give a huge boost to this growing sector of Indian Economy and in the Indian Medical Electronics provide a platform to the Medical market reaching close to USD ~6.5 Electronics and Equipment billion by the year 2020.

Indian Embassy, 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

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.

India Newsletter • 23

Indian Embassy, Vienna

TOURISM The Days of Festive Misrule Called CARNIVAL

by Hugh & Colleen Gantzer.

It’s the only one of its kind in Asia.

It is a a three day, state-wide, explosion of dancing in the streets, pageants and feasting. It owes its name to feasting: a sort of sanctified, assertive feasting.

And with feasting comes jubilation, merry-making, happiness spilling over to everyone in sight: friends, relatives, visitors, total strangers. It’s a time of joy unlimited and it can happen only in Goa. This is how it happened.

In the old days, Roman Catholics were expected to fast and to shun all festivities for the 40 days of mourning before Easter Sunday.

During these Lenten days, starting on Ash Wednesday, Catholics were also forbidden to eat meat. Consequently, just before Lent they gave huge feasts to consume all the meat in their larders. In the medieval Latin of the Church, this was called carnem levare: ‘remove the meat’. The feasts grew into festivities, the festivities burgeoned into uninhibited celebrations as a final fling before the self-denying, partypooping, grey days of Lent.

These festivities were called by a shortened form of the words CARNEm leVAre: Carnivals.

Today, it is only in Brazil’s Rio de Janerio that Carnivals are as uninhibited as they used to be in ancient Rome. A hotelier in Panjim told us that he had been excited by a magazine article on Rio’s carnival. He had then persuaded his business friends, languishing in the post-Portuguese slump in Goa, to launch a toned-down version of those celebrations to attract tourists to their state. The idea caught on and everyone got into the act.

Weeks and months before the Carnival, local clubs, and other organizations, work in secret to create eye-catching floats, rehearse teams of brightly dressed dancers swinging to the amplified music of live bands on 24 • India Newsletter

open trucks; and mummers, stiltwalkers, acrobats, jugglers weaving through the streamer-festooned main streets of Panjim (aka Panaji), Margao (pronounced Mud-gaon) and lesser places. Hotels burst at the seams, restaurants and bars are chock-abloc and raucous. And the Carnival Committee, in secret and convivial conclave, meet to crown a suitably impressive Goan male as the iconic King Momo, Lord of the Revels. They also choose his court of handmaidens, guards, perhaps a mermaid or two, to help His Misruling Majesty inaugurate the carefully choreographed chaos of Carnival from Saturday to Fat Tuesday!

Every year the Carnival evolves and changes. But every year, essentially, it remains the same: a bright blossoming of the spirit of Goa where hard work masquerades as hi-jinks and an innate joie de vivre clothes even so regimented an activity as a parade with mischievously creative irreverence. When you go to the Carnival, look for the wicked little signs of satire, the assertion that though some people in authority can fool many of the people much of the time you can’t fool most of the Goans any of the time!

Here, then, are the highlights, and our impressions, of the many Carnivals we’ve attended.

The first day of Carnival dawned.

The street, facing the estuary of the old Mandovi river in the capital, rustled with flags and bunting.

Crowds began to stream in, stand four to five deep behind the guard rails. The privileged invitees sat on the balconies of the elegant old Secretariat. Others crammed into windows, verandahs, perched on the branches of stately old trees. The police, scattered through the crowd, watchful in jeeps and control cars, were vigilant: sometimes, innocent high spirits can be misunderstood and escalate into ugly scenes; nowadays, unknown others, trained in mayhem, welcome such public festivals to wreak their havoc. So far,

however, such imported evils have never touched the Carnival.

But then, a strange, electric silence settled over the crowd. Even the mewing gulls, fluttering like confetti over a fishing trawler in the river, were still. Then we heard a distant roar, like a great breaker swooping down on a shore. It came closer and closer and the crowd breathed a collective sigh like a great predator sensing its quarry. A phalanx of motor cycles, like giant snarling beetles, came into sight, growing larger and larger. Many were the famed motor-cycle taxis of Goa, often called ‘Easy Riders’ and ‘Pilots’, who sweep passengers from one end of Goa to the other as swiftly as djinns.

They were the outriders for the high regal chariot of the King.

Then came His Majesty’s Company of jesters, clowns, sycophants, windblowers, drummers, heralds and inflated wind-bags and all the other assorted hangers-on that have always made up the regal retinue of all courts, even to this day. And only then, only when everyone had been impressed with the Power and the Might of the Great Presence who was about to arrive, did the Imperial Chariot of King Momo and his glittering court appear to give a moving darshan, a royal audience, to his wildly cheering subjects.

His chariot was decorated with the colourful face of a huge sphinx. We asked a fellow spectator with a white goatee beard and a mane of sweptback silver hair, what the sphinx signified. He said, in a voice as sere as dried leaves rustling in a frosty wind: “Rulers, whether born, elected or thrust into the high seat, need masks to hide their true identity. And what can be more enigmatic than the sphinx?” He said something more but then his voice was drowned out by an approaching band blaring Abba’s very popular Honey Honey.

Young couples in yellow and black swung and swirled in the street with

Indian Embassy, Vienna

that exquisite sense of rhythm that is the inheritance of Goa. And so it went on, float after float, band after band, teams of dancers following other teams of dancers. There were mummers with the painted faces and inflated heads of self proclaimed ‘leaders’ strumming the guitars of their catch phrases. There were bedecked stilt walkers striding taller than nature had wanted them to. And there were many, very many, ordinary Goans backed by the flowers of their achievements, enjoying the celebrations, smiling at the many colourful messages being sent to everyone who cared to see. And even to those who could not look beyond the brilliant scrim-screens that hid many of the Carnival’s mischievous messages.

At the end of that first sensedrenching day, King Momo and his court mounted the sweeping steps of an old Church. There, with all eyes focused on him, he read out his proclamation. He commanded everyone to forget their cares and troubles, to put aside their worries and anxieties, and enjoy themselves in the spirit of the Carnival.

That’s exactly what we did. There was food and music and fun and friendliness wherever we went.

We shook more hands than we could remember, embraced more strangers than we had ever done before, kissed more cheeks than we had bussed in any wild New Year’s Eve party. And we ate more Goan food and drank more Goan wine than was good for us.

But, on the last evening, we wore red and black and danced all the excess calories away in the iconic Red and Black Ball. It’s a good thing that the Carnival happens only once a year.

But it’s an even better thing that it really does happen…!

Viva la Carnival !!!

India Newsletter • 25

Indian Embassy, Vienna

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 maoffice.vienna@ mea.gov.in

Saheb Biwi Aur Gangster ■■ Synopsis: After the death of his first wife, wealthy Raja Aditya Pratap Singh, re-marries another woman, simply known as Chhoti Rani, who subsequently becomes mentally unstable. His father’s former mistress, Badi Rani, controls the wealth, while he himself has a mistress. Unable to procure contracts through Mantri Prabhu Tiwari, he decides to stand for elections, while his rival, Ghenda Singh, recruits an assassin, Babalu, who is also the nephew of Sunder, Chhoti Rani’s chauffeur, to kill Aditya. After Sunder is unable to drive due to an injury, he recommends Babalu, and Aditya hires him. Babalu settles down in his new JOB, attempts to get accepted by everyone, including Chhoti Rani, who he finds attractive. He soon finds out that she, too, has feelings for him, and then starts making plans of not only carrying out his assigned task but also becoming the next Saheb.

■■ Genre: Action/Crime/Drama ■■ Directed by: Tigmanshu Dhulia ■■ Starring: Randeep Hooda, Mahie Gill, Jimmy Shergill ■■ Released: 2011 ■■ Duration: 118 Minutes ■■ Language: Hindi ■■ Subtitles: ENGLISH ■■ Image Quality: STANDARD

Showtime October 30th, 17:30 Indian Embassy Business Centre (1st Floor, Kärntner Ring 2, 1010 Vienna) 26 • India Newsletter

Indian Embassy, Vienna

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 info.vienna@mea.gov.in 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: maoffice.vienna@mea.gov.in or 01 505 8666 30 ■■ Marketing Assistant: comm.vienna@mea.gov.in or 01 505 8666 31

STUDENTS WELFARE OFFICER ■■ Mr. Pawan T. Badhe, Second Secretary 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 15 and pol.vienna@mea.gov.in

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

Ministry of External Affairs proudly presents “MEAIndia” – an integrated smart app for mobile and other hand held devices ‘MEAIndia’ is now available for download on App Store and Google Play Store..

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www.facebook.com/IndiaInAustria www.twitter.com/IndiaInAustria India Newsletter • 27