India Newsletter 10 2016

INDIA NEWSLETTER Indian Embassy, Vienna

Published by the Embassy of India, Vienna Year 6 • Issue 70 • October 2016

MAKE IN INDIA ■■MEDIA AND ENTERTAINMENT 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

Indian Embassy, Vienna

The Government of India 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

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

Indian Embassy, Vienna

INDIAN DIASPORA & INDIAN STUDENTS ABROAD MADAD (‘MEA’ in Aid of Diaspora in Distress) - a new Consular Services Management System from the Government of India to the Indian Diaspora The Government of India has launched an online portal: MADAD (‘MEA’ in Aid of Diaspora in Distress), a Consular Grievances Monitoring System.

Consular grievances regarding compensation, court

cases, domestic helps, imprisonment abroad, transportation of mortal remains, repatriation, salary dues, tracing the whereabouts can be lodged under this portal. Grievances relating to visa and passport, travel documents, attestation of documents will not be entertained in this portal. To register and to monitor the status of your grievances please visit the MADAD portal under madad.gov.in Please register as MADAD user if

you have any grievance related to consular s e r v i c e s o f f e r e d by Indian Missions/Posts abroad or are an Indian student studying/planning to study abroad.

MADAD enables online logging and tracking of grievances, and submission of course/contact details of students.

India Newsletter • 5

Indian Embassy, Vienna

NEWS FLASHES

01

India has been ranked fourth globally in terms national legal frameworks for right to information (RTI): Centre for Law and Democracy Europe.

02

The Indian power sector itself has an investment potential of US$ 250 billion in the next 4-5 years, providing immense opportunities in power generation, distribution, transmission and equipment.

The ADB (Asian Development Bank) retained its projections for India’s economic growth at 7.4 per cent for FY 2017 and stated that India’s economy will remain on a strong growth path, aided by implementation of key structural reforms, robust consumer demand and higher agricultural output, driven by a good monsoon.

03

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Mr Jamie Dimon, Chairman of JPMorgan, considers India a bright spot among its global peers with good prospects over next 20-30 years, supported by government policies conducive to future growth and diminishing fiscal deficit.

Total inflows into India from listed funds stood at US$ 1.3 billion in August 2016, which is the highest among emerging markets.

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The adoption of the new Indian Accounting Standards (IndAS) will make financial statements of Indian companies comparable with their global peers, and thereby improve the credence of India among global investors.

07

Engineering exports from India increased 4.7 per cent year-on-year to US$ 4.87 billion in August 2016, and are expected to maintain positive direction going forward .

Corporate funding of solar projects in India rose to nearly US$ 3 billion in 45 deals during July-September’16, against US$ 1.7 billion in 32 deals during April-June’16.

Mr Rahul Munjal, Chairman and Managing Director, Hero Future Energies Pvt Ltd, has estimated India’s renewable energy industry to grow to a size of Rs 2 trillion (US$ 30 billion) in the next three years, owing to rapid progress in technology and lowering of costs.

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A total of 70 Indian companies are expected to raise over US$ 5.8 billion through initial public offerings (IPO) in 2016, out of which 50 companies have already raised US$ 2.93 billion so far, according to Baker & McKenzie.

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The Ministry of Corporate Affairs (MCA) has launched a Simplified Proforma for Incorporating Company Electronically (SPICE), aimed at providing speedy incorporation related services within stipulated time frames to bring ease of doing business in the country on a par with global norms.

12

The Reserve Bank of India (RBI) plans to allow start-ups to raise up to US$ 3 million a year, either in rupees or in any convertible foreign currency or a combination of both, through the external commercial borrowing (ECB) route.

13

The Government of India has unveiled a new Urban Development strategy for the next 20 years, aimed at development of rural and urban areas, housing for all urban poor and ensuring gender equity in the country among other objectives.

16

The International Monetary Fund (IMF) has welcomed the strong reform steps taken

by India, especially related to passing of legislation for the Goods and Services Tax (GST), which the IMF expects to boost the country’s medium term growth.

Indian Embassy, Vienna

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 indiatvoa@gov.in.

INDIA-AUSTRIA NEWS ARTICLES Indian Entrepreneur leads Children’s Physical Fitness Assessment Study in Austria

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ith its Austrian branch being directed by Indian entrepreneur Mr. Puneet Teja, Eurofit is conducting the largest study of fitness levels of school children involving 300,000 fitness assessments over a 3 year period in Europe and in India.

Health and fitness of children has been a growing concern and issues such as obesity, type 2 diabetes and chronic back pain have been growing steadily since the year 2000. Up to 22% children below the age of 15 years are medically obese (OECD, Health at a Glance).

The awareness of parents and schools about physical fitness is limited especially with regard to its measurement. Most parents are not aware that physical fitness can be measured just as objectively as BMI (Body Mass index) and blood cholesterol levels can be measured;

that fitter children have better academic performance and lower incidence of type 2 diabetes, chronic back pain and obesity. Although medical diagnosis and care has improved markedly, even medically healthy children have low physical fitness levels.

Eurofit Sports Research Institute (www.eurofitresearch.org) physical fitness assessment is done digitally through fun exercises designed for children for measurement of Muscle Strength, Agility, Balance, Flexibility and Endurance. These exercises are based on the standard exercises laid down by the European Council in 1983. Given the manual measurements required in testing, it takes 20 to 30 minutes per child making it expensive for large scale deployments. Eurofit has automated the assessment process using IoT devices enabling one supervisor to assess a class of up to 40 students within 50 minutes. The test is conducted in limited space in the Kindergarten / day-care center / school premises.

The participating schools get a free report showing the level of their students compared with other children. The key research objectives are determining the correlation between socio-economic status of the participants’ families and their fitness levels and the comparison of change in fitness with age between boyband girls especially after reaching puberty.

Schools are encouraged to make innovative interventions by uptraining the schools physical education staff and introducing partners specialized in in-school and after-schools sports such as EduSports.

Puneet Teja, one of the Directors of Eurofit commented, “In addition to the study we are also actively looking for positive outlier children who show exceptional physical fitness and recommend them to pursue a sporting career”. In this regard, Eurofit is establishing a formal touchpoint with the IOC (Indian Olympics Committee).

India Newsletter • 7

Indian Embassy, Vienna

The overarching aim of Eurofit is to promote Digital EPE (Evidence Based Physical Education Programs) in schools through use of technology to measure fitness and grade students based on individual fitness levels in addition to their performance in classical sporting activities. For this, it is offering audit and certification programs for physical education programs in schools.

Eurofit has been awarded a certificate of excellence by the European commission and has received financial support from Austrian Research Promotion Agency and Austrian Business Promotion Agency.

Mr. Muegge, the European Director, mentioned, “We are delighted that corporates are extending support from their CSR programs both in India and in Austria”.

Eurofit is one of the first Austrian organizations to participate in

Austrian Music Groups may apply for the 7th edition of “International Dance& Music Festival”, New Delhi

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he 7th edition of “International Dance& Music Festival” will take place between 13-15 January 2017 at Kamani Auditorium, New Delhi.

Interested cultural organisations/ groups in AUSTRIA are welcome

Digital India in this space with the aim of making India the first country to implement an evidence based physical education system using

state-of-the-art sensor technologies

to participate in this international festival. The Indian Council for Cultural Relations (ICCR) will facilitate grant of gratis visa for India, local hospitality including board/lodging, intercity &local transportation; cost of presentation of programme including venue, technical & publicity for organizing the festival in New Delhi. The sponsoring organisation has to bear the cost

of international transportation, medical insurance and performance charges/fees etc. In case of any clarification or query please contact ICCR on the telephone number: 0091-11-23370782/0940 Nominations of the group intending to participate in the Festival can be sent to the Embassy on email maoffice.vienna@mea.gov.in not later than 10 November 2016.

and IoT devices. For queries please write to: office@eurofitresearch.org

PAST EMBASSY EVENTS Networking Event in

queries.

collaboration with ICC

The event took place at the Embassy

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Business Center (EBC) and counted

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of India in with the

with the participation of Austrian

International Chamber of Commerce

companies from different industries.

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An introductory address for the

on 10th October 2016 with the

event was given by our Deputy Chief

aim of bringing together Austrian

of Mission, Dr. Suhel Ajaz Khan and

companies having business interest

was followed by Q&A and discussion

in India and to provide them with a

session. The event was well attended

platform to share their experiences

and received positive feedback from

and/or provide answers to their

the ICC and guests.

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Indian Embassy, Vienna

Celebration of Mahatma Gandhi Jayanti by the Embassy of India, Vienna

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he Embassy of India, Vienna celebrated Gandhi Jayanti in a befitting manner on October, 2nd 2016. The Embassy organized an event on this occasion at the

Embassy business Centre which was attended by large number of Indian community members. The speech of Hon’ble Prime Minister on the inauguration ceremony of Pravasi Bhartiya Kendra at New Delhi was screened during the event. Some of the memorable bhajans, liked by Mahatma Gandhi, were also recited

during the event. The Ambassador of India, Shri Rajiva Misra in his address recalled principles of non-violence, satyagrah and unity as espoused by Mahatma Gandhi. Gandhi Jayanti is also celebrated across the world as the International Day of nonviolence. Some impressions of the event:

Mission releases new Commercial Publication: Indian Economy and Investment Opportunities - A State-byState Snapshot

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n order to provide a structured overview of the current economy of the Indian states and union

territories (U.T.) as well as highlights of imminent opportunities for business, the Indian Embassy, Vienna, has brought up a publication entitled “Indian Economy and Investment Opportunities – A Stateby-State Snapshot”, a comprehensive guide, which portraits India’s states’ and U.T.’s latest economic developments, its main industries and major incentives for foreign investment.

The publication is available online and also as hardcopy. The same is being distributed among several Austrian corporates and other parties interested in doing business with India.

To request your hard copy of the publication, please email us with your contact details and delivery address at maoffice.vienna@mea.gov.in To access the online version of the publication, please see: https://issuu.com/indemb/docs/states_ publication_printable India Newsletter • 9

Indian Embassy, Vienna

NEWS ARTICLES IMF revises India’s growth to 7.6% for FY17 and FY18 The International Monetary Fund (IMF) on Tuesday raised projections for India’s economic growth by 0.2 percentage points to 7.6 per cent for 2016-17 and 2017-18. The projections came in at a time when the Fund said global economic growth will be subdued this year, following a slowdown in the US and Britain’s vote to exit the European Union. It, however, retained global economic growth at 3.1 per cent for 2016 and 3.4 per cent for 2017.

In its World Economic Outlook, IMF also kept gross domestic product (GDP) expansion for China unchanged at 6.6 per cent in 2016, which would decelerate to 6.2 per cent in 2017. That way, India would keep its position of the fastestgrowing large economy that it snatched from China in 2015-16.

“India’s GDP will continue to expand at the fastest pace among major economies, with growth forecast at 7.6 per cent in 2016–17,” it said in its outlook released three days ahead of its annual meetings with the World Bank in Washington.

The Fund cut growth rate of the US by 0.6 percentage points for 2016.

It, however, cautioned India that weak corporate and public-sector banks’ balance sheets would restrict private investment in the near-term where the Reserve Bank of India’s (RBI) continued role to increase lenders’ capacity to give loans would be critical. It highlighted the importance of the goods and services tax, which is targeted to be introduced from April 1, 2017 and elimination of poorly targeted subsidies. IMF had released its previous estimates through an update in July. However, if looked from the April outlook, the global growth was cut by 0.1 percentage point each for 2016 and 2017, while it was raised for India by 0.1 10 • India Newsletter

percentage point for 2016-17 and 2017-18.

IMF’s projection is more or less in line with the finance ministry’s optimism that the growth would be towards the upper band of its projections — 7-7.75 per cent — in the current financial year.

However, it is higher than what the Asian Development Bank and Fitch predicted. India’s economy expanded 7.6 per cent in 2015-16.

So, IMF’s projections also mean that the GDP growth would remain stagnant for three consecutive years.

The growth rate was five-quarter low at 7.1 per cent in the first three months of the current financial year.

IMF also projected india’s economic growth rate to touch 8.1 per cent in 2021-22. Fitch had said on Monday that India’s GDP growth could touch eight per cent only in 2018-19, as it expects the benefits of reforms and impact of monetary easing to kick in with a lag. IMF did not give projections for 2018-19 and 201920.

It said India’s economy continued to recover strongly, benefiting from a large improvement in the terms of trade triggered by lower commodity prices, effective policy actions and stronger external buffers which have helped boost investment. Inflation has declined more than expected, it said.

Consumer price index-based inflation fell to a five-month low of 5.05 per cent in August from 6.07 per cent in July. IMF projected inflation to average 5.5 per cent in the current financial year and decelerate to 5.2 per cent next year.

Nevertheless, underlying inflationary pressures arising from bottlenecks in the food storage and distribution sector point to the need for structural reforms to ensure that consumer price inflation remains within the target band over the medium term, the Fund said.

Additional labour market reforms to reduce rigidities are essential for maximising the employment potential of the demographic dividend and making growth more inclusive, it said.

In the near term, it said private investment will likely be constrained by weakened corporate and public bank balance sheets. “Continued efforts by the Reserve Bank of India to strengthen bank balance sheets through full recognition of losses and increasing bank capital buffers remain critical for improving the quality of domestic financial intermediation,” it said.

The multi-lateral agency said important policy actions toward the implementation of GST have been taken, which will be positive for investment and growth. Constitution amendment legislation to enable the Centre and states implement GST has been enacted. The GST Council, comprising representatives of the Centre and states, have been formed which has already solved prickly issue of a threshold over which GST would apply and cleared rules for registration and refunds under the new tax regime.

Another thorny issue of rates, compensation and dual administrative control over service tax would come up at the Council’s scheduled meeting for later this month.

IMF said this tax reform and the elimination of poorly targeted subsidies are needed to widen the revenue base and expand the fiscal envelope to support investment in infrastructure, education, and health care.

More broadly, while several positive measures have been undertaken over the past two years, IMF pointed out, suggesting that additional measures to enhance efficiency in the mining sector and increase electricity generation are required to boost productive capacity.

Indian Embassy, Vienna

Year 2016 to be best for Indian firms’ IPOs: Report The year 2016 looks set to be a record-breaking year for Indian IPOs as over 70 companies are expected to list on the bourses raising a total of $5.8 billion (almost ₹39,000 crore), more than double of last year’s $2.18 billion (₹14,606 crore), according to a Baker & McKenzie report.

About 50 companies have already raised $2.93 billion (₹19,500 crore), the highest since 2011, there are an estimated 22 more companies in the pipeline before the year ends.

Materials, industrials and financials continue to be busy sectors by value and volume. IPO activity in financials and telecommunications sectors will pick up, as a number of additional mega deals close, including Vodafone’s and PNB Finance Housing Ltd’s IPOs worth $3 billion and $388.45 million respectively. The Vodafone IPO is expected next year.

According to the global law firm, momentum in the IPO market is building due to the government’s drive to cut bureaucratic red tape through measures such as rationalisation of the tax regime via the Goods and Services Tax Act. Union finance minister Arun Jaitley had also said that the GST legislation alone would boost India’s GDP growth by as much as two percentage points.

“The flurry of IPO activity is likely to continue for the rest of 2016 and well into 2017, driven by upbeat economic sentiment, improved business confidence, easing inflationary pressure and stable foreign direct investment inflows,” said Ashok Lalwani, head of Baker & McKenzie’s India practice.

Domestic listings will dominate India’s IPO scene, dual listing on both BSE and NSE accounted for 98.8% of Indian companies’ listings by value in 2016 to date, raising a total of ₹19,400 from 21 IPOs, including ICICI Prudential Life Insurance’s ₹6,000 crore listing, which is the country’s biggest IPO since Coal India’s in 2010.

Apart from domestic listings, Indian

companies are also looking at crossborder IPOs to tap growth and market expansion opportunities and the means to access risk capital.

Among upcoming IPOs, Strand Life Sciences’ will list on NASDAQ, which will be India’s first cross-border IPO since early 2015 when Videocon d2h listed on the same exchange.

Aster DM Healthcare and Varsity Education Management are also expected to list soon with IPOs of ₹1,200 crore and ₹2,000 crore respectively.

More listings in the insurance sector could be on the horizon, following the government approval to raise foreign ownership to 49% from 26%. The Insurance Regulatory and Development Authority of India has also proposed to make IPOs mandatory for all general insurance companies in operation for eight years or more, as well as for life insurers that have been operating for 10 years or more.

“The insurance sector is definitely one to watch out for, although IPO momentum will be heavily influenced by the post-listing performance of ICICI Prudential Life Insurance and the readiness of the insurance companies to hit the market,” Lalwani added.

Indian engineering exports to move towards positive direction: Study An uptick in top European markets including UK, France, Italy and the Netherlands , coupled with low base effect are helping Indian engineering exports to move towards a positive direction an EEPC India’s analysis has shown.

All the European nations falling under the top 25 engineering export destinations like UK, Germany, Italy, Belgium, Netherlands, France and Spain, recorded positive growth during Apr-Aug 2016-17 over AprAug 2015-16. However, Germany and Belgium recorded negative growth in August 2016 over August 2015. Belgium topped the list registering highest growth in August 2016 and also on cumulative

basis during Apr-Aug 2016-17.

Though engineering exports moved up y by 4.7% from $ 4.65 billion in August 2015 to $4.87 billion in August 2016, the cumulative growth for the global basket as a whole remains negative for AprilAugust period of the current fiscal .

Cumulative engineering exports for this period dropped by 4% to $25.13 billion in Apr-Aug 2016- 17 from $26.18 billion in the same period last year.

“However, there is a positive news even on a cumulative basis as far as the top European markets are concerned,” said EEPC India chairman Mr T S Bhasin.

Out of 220 exports destinations of Indian engineering goods, top 25 nations accounted for more than 73 per cent of India’s total engineering exports during Apr-Aug 2016-17.

Overall, India’s engineering exports to its top 25 destinations registered a rise in growth of 5.8% in August 2016 over August 2015 against a dip of about two per cent on cumulative basis to $18.36 billion for AprilAugust period of the current fiscal against $18.74 billion during the same months of 2015-16.

Mr Bhasin said faced with global risks emanating from geo political factors, Brexit play-out and rising crude oil prices , one has to still keep the fingers crossed

Cabinet approves MoU between India and Hungary on cooperation in the field of water management The Union Cabinet under the Chairmanship of Prime Minister Shri Narendra Modi has given its approval for signing of a Memorandum of Understanding (MoU) between India and Hungary on cooperation in the field of water management.

The MoU will be signed between Ministry of Water Resources, River Development and Ganga Rejuvenation, Government of India and the Ministry of Interior, Government of Hungary. It will enhance bilateral cooperation in the field of water management, on India Newsletter • 11

Indian Embassy, Vienna

the basis of equality and mutual benefits. This will encourage the development of bilateral relations between public and private organizations concerning water resources of both the countries.

Both the countries will get benefited by joint activities and mutual exchange of scientific delegations and experts in the field of water resources development and management. The cooperation, particularly on river basin management/ integrated water resources management, efficiency in water supply and irrigation technology innovation and flood & drought management will help improve the socio-economic conditions of the people of both the countries.

Ministry of Water Resources, River Development and Ganga Rejuvenation is entering into a MoU with Hungary with wide-ranging areas on water sector for the first time.

Ease of doing business race hots up among states The race to decide the easiest state for doing business in India has gone down to the wire.

If the year began with Bihar in the lead, it was Uttarakhand that led the race for the past few months. Now, Telangana is on top, dethroning arch rival Andhra Pradesh. The gap between the two is just one hundredth of a percentage point.

On Sunday evening, India’s youngest state, Telangana, had a score of 96.98% compared to Andhra’s 96.97%.

And last year’s winner Gujarat, which dropped to the sixth position just 10 days ago, is now placed third with a score of 94.99% as a World Bank team goes through the last 100 steps taken by Indian states before releasing the rankings.

When the rankings were released for the first time last year, states were gauged on 98 parameters for improving the regulatory framework for business. This year, they are being graded on the basis of their 12 • India Newsletter

performance on 340 parameters — so far the most detailed exercise of its kind.

States were asked to submit the steps that they had taken on performance indicators such as ushering in transparency, singlewindow clearances, availability of land, construction permit enablers and environmental registration enablers. Their submissions are still being validated and marks assigned.

“We are taking a little time in releasing the rankings because we want to be sure that the steps that states are claiming to have initiated are properly verified,” said an officer.

In three years, renewable sector will be worth Rs2 trillion in India: Rahul Munjal India’s renewable energy industry will be worth Rs2 trillion within the next three years and in five years India’s energy industry will be different from what we see today, said Rahul Munjal, chairman and managing director of Hero Future Energies Pvt. Ltd. “Renewable has changed the way energy is produced and consumed in the last five years dramatically all over the world. So we need to get out of the mindset of 2010. If we don’t understand this, we will completely lose out. We are, in renewable, looking at an industry which will be of Rs200,000 crore in the next three years,” Munjal said at Mint’s Annual Energy Conclave 2016–Securing India’s Future on Wednesday.

Stating that costs have gone down by 162% since 2008 for solar and 75% incidentally for storage, Munjal said, “If you were to draw out what’s going to happen in the next five years from now, the energy industry would be very different from what we see today.”

“Renewable is still in its infancy and we have to grow manifold. Right now we have learnt to take our first step and I think this is the time we need to put down building blocks for the future. I am assured, India can produce the best scientists for

R&D (research and development) in renewable. We can have the best ITI’s (Industrial Training Institutes) specialized in manpower for renewable,” he further said.

Nissan to design cars in India for world market India is set to become the “most important” country for Nissan in the Africa, Middle East and subcontinent region with Chennai at the centre.

The city will be the hot-bed for design and development of technology and cars for the Japanese automaker as it draws up plans to develop eight cars in India – most of which do not exist in the company’s portfolio.

“India is ready… we have excellent engineers, a strong supply base which is required to develop cars, and it is cost efficient… We decided to develop cars out of India five years ago,” Christian Mardrus, chairman of Africa, Middle East and India region at Nissan Motor Corporation told HT. The region accounts for 14.5% of Nissan’s global sales.

This will also be the first time a Nissan product will be developed locally keeping in mind the domestic market and will export them too. So far cars, including Micra and Sunny, were designed and developed in Japan and localised for India.

Nissan did not disclose the exact body-types, but gave indications.

“Part of that will be SUV and crossover oriented. These products do not exist in India,” said Guillaume Sicard, president of Nissan India Operations.

In the past Renault’s chairman Carlos Ghosn has praised India’s methods of “jugaad” in manufacturing to develop low-cost cars. “I always admire what you call Jugaad… (We) want to make it a weapon in the global market,” he said in 2012. The Chennai plant is the first plant of the NissanRenault alliance. For Datsun, Sicard said that future products will be “fully adaptive to emerging markets”.

The first made-in-India car was the Datsun RediGo.

Indian Embassy, Vienna

“We have proven with RediGo and Kwid that we can develop cars and not only modules and parts,” said Mardrus.

Nissan is also setting up a design team, which only exists in the US, Japan, UK and France.

At present, Nissan has a 6,000 engineers in Chennai working on the new cars, the first of which may roll out around March 2018. ”The engineering centre will focus on new technologies … especially in the space of intelligent mobility, connectivity, autonomous driving.

Chennai will be key in all these,” Mardrus said.

Adoption of GST poised to boost India’s medium-term growth: IMF Asserting that India has shown that progress on reforms could “ignite” business investment, the International Monetary Fund (IMF) on Friday said the adoption of goods and services tax is poised to boost the country’s medium-term growth.

“India’s strong reform push in 2016 is welcome and should continue apace. Adoption of the goods and services tax is poised to boost India’s medium-term growth,” the IMF said in its latest Asia-Pacific regional economic update.

Greater labour market flexibility and product market competition remain essential to create jobs and raise growth. Priorities also include effective implementation of the new corporate debt restructuring mechanisms, it said.

“As shown by India, progress on reforms could ignite business investment (including already strong FDI inflows), further boosting domestic demand,” the IMF said.

Over the medium term, a number of Asian economies stand to benefit from a demographic dividend, as the working-age population in some economies like India and Indonesia continues to grow, potentially helping sustain strong potential growth.

In its report, the IMF said India’s gross

domestic product (GDP) growth is projected at 7.6% in both 2016-17 fiscal year and 2017-18 fiscal year, up 0.1 percentage point relative to the April 2016 World Economic Outlook, a survey conducted and published by the IMF. The ongoing growth recovery remains braced by private consumption, it said.

“Monsoon rainfall coming in at normal levels bodes well for agriculture and, along with a decennial rise in government employee salaries, will underpin the ongoing recovery in domestic demand,” the IMF report said.

“Further progress on reforms will boost sentiment, and the incipient recovery of private investment is expected to help broaden the sources of growth amid gradual fiscal consolidation and broadly neutral monetary policy,” it said.

“Medium-term growth has also been revised upward reflecting continued progress on structural reforms (constitutional amendment enabling implementation of the national goods and services tax, adoption of inflation targets, and removal of foreign direct investment (FDI) ceilings),” the report said.

The IMF said India’s growth has continued to benefit from the large improvement in the terms of trade, positive policy actions, including implementation of key structural reforms, gradual reduction of supply-side constraints, and a rebound in confidence.

World sees India as bright spot, experts expect more sunshine Most of the world clearly sees India as an economic bright spot, but the country’s policymakers and industrialists at India Economic Summit of World Economic Forum say there’s a lot of room to improve and lift growth to over 8%.

“We need to work harder with states to remove all regulatory hurdles still prevailing at the lower level,” commerce minister Nirmala Sitharaman said at opening session of the 32nd edition of India Economic

Summit, jointly organised by World Economic Forum (WEF) and industry chamber CII, on Thursday.

There is near unanimity on the reforms undertaken by the Narendra Modi government, and India has recently improved its ranking in WEF’s World Competitiveness Index by 16 places for the second year in a row to join the top 40 nations.

Sitharaman, who is working towards improving the ease of doing business in the country, said there is much scope for further improvement in ranking and to boost economic growth. She said the government needs to ensure that whatever investment is coming into the country actually translates into rapid productions, exports and lead to creation of good jobs to help the country achiever higher growth rates.

Indian economy is forecast to growth 7.6% according to the latest assessment by the IMF. India’s policymakers expect growth at near 8%.

Sri Lankan Prime Minister Ranil Wickramasinghe, meanwhile, marked out India and China as the only countries that can drive economic growth across the globe and said manufacturing companies have no other place to go. “Asia will bail out the world (from the economic crisis), if it is allowed to frame the rules (policies),” he said.

Speaking on India’s inflection point and what the country needs to do to transform the state of its economy and people, NITI Aayog CEO Amitabh Kant said the only way India can catch up with the developed world is through use of digital technology to leapfrog.

“India needs to bring about radical restructuring of its health and education system if it were to grow at a sustainable rate of 8% for the next three decades,” Kant said. He identified digital revolution, a strong demographic dividend, a growing entrepreneurial ecosystem, and a larger domestic market as key India strengths.

Pawan Munjal of Hero Motors said India Newsletter • 13

Indian Embassy, Vienna

the government should take on land and labour reforms head on to help push manufacturing in the country.

John Rice, vice chairman of GE, said, “India’s missions should be to ensure sustainable and inclusive growth. To achieve this, India will have to ensure to invest in right things, including creation of basic infrastructure and skilling a million of its workforce every month.”

Responding to the question of where India is heading after 25 years of economic liberalisation and what needs to be done, Gita Gopinath, economics professor at Harvard University, emphasised that the pace of reforms should continue.

“Reforms should continue in the areas of improving competitiveness, ease of doing business and infrastructure, with focus on outcomes in education and health.

Also the pace of reforms should not trip around elections if India were to grow at a sustainable rate of 8% and more,” she said, adding major emphasis has to be on skilling.

Indian IoT market to touch US$ 15 billion by 2020: Nasscom Indian Internet of Things (IoT) market is set to grow to $15 billion by 2020 from the current $5.6 billion, according to a report by Nasscom released on Wednesday in Bengaluru, as part of its design and engineering summit.

The IoT sector is set to get major boost from industrial IoT, which currently accounts for 60% for the total market and includes integration of physical machinery with networked sensors and using the data for faster and more efficient operations.

Consumer IoT, which includes smarthome devices as well as wearables, account for the remaining 40% of the IoT market.

This is set to change, with consumer IoT’s share rising to 45% by 2020, the report said.

Owing to the e-commerce boom and regulatory changes such as GST, Transport & Logistics is set to 14 • India Newsletter

increasingly utilize IoT for more efficient operations.

The rise of tech-savvy consumers and increasing smartphone & mobile internet penetration would also help in driving consumer IoT. “In India, while the industry is at a nascent stage industrial applications of IoT primarily in manufacturing, automotive and transportation & logistics are expected to drive IoT revenues by 2020,” said R. Chandrasekhar, president, Nasscom.

Major Indian IT companies are betting on new digital technologies such as IoT, analytics and artificial intelligence to diversify their revenue stream and fill in gaps for the slower growth in traditional IT business.

“IoT has started being incorporated into both consumer and industrial applications being utilized in critical verticals like Healthcare, Automotive and Manufacturing. The ecosystem is rapidly expanding, owing to demand for both Industrial and Consumer IoT applications and is set to be a critical part of the next level of growth for the IT industry” said Kevin Ashton, a British technology developer, who coined the world Internet of Things.

Cumulative Solar Installations in India Cross 8.6 GW Cumulative solar installations in India have reached 8.6 gigawatt as of September 2016. This calendar year installations are expected to touch 4.8 gigawatt while installations so far has been 3.8 gigawatt According to Mercom Capital Group, approximately 500 MW of solar capacities has been installed in about a month. Four states have crossed the 1 GW solar installation mark.

Out of the 8.6 GW installed so far, Tamil Nadu, Rajasthan, Gujarat and Andhra Pradesh have had significant activity and account for 59% of total installations.

India currently has 14 gigawatt of solar projects in various stages of development and another 7

gigawatt waiting to be auctioned.

Solar installations are expected to continuing to grow, even with a slowdown in power demand, a decline in capacity utilization among thermal projects, and the availability of cheap power on the power exchanges across the country.

“The challenge is going to come next year when approximately 9 gigawatt of solar power is forecast to be installed. Unless the ‘must run’ status for solar projects is strictly enforced we would see some challenges,” said Raj Prabhu, CEO of Mercom Capital Group.

Start-ups can now take foreign currency loans via ECB route The Reserve Bank of India (RBI) said it would allow start-ups to access foreign currency loans of up to $3 million a year under the external commercial borrowing (ECB) route, in a statement separate from the monetary policy review.

Start-ups can raise up to $3 million either in rupees or in any convertible foreign currency or a combination of both, said the statement.

In February, RBI allowed start-ups to raise rupee loans through the ECB route. It had also said that it would facilitate the issuance of innovative instruments such as convertible notes by start-ups to make it easier for them to attract foreign direct investment.

“Start-ups have the potential to play a significant role in economic growth and job creation by spurring innovation and injecting competition,” said the statement. It added that guidelines will be issued by the end of this month.

Borrowing in foreign currency will cut down the cost of conversion for the start-ups.

“The avenues for start-ups will expand as it will help to ease out on liquidity part. It will be very beneficial for those who make payments in dollars, though they need to have necessary backup support to comply with the guidelines,” said Anil Joshi, managing partner, Unicorn India

Indian Embassy, Vienna

Ventures.

RBI’s move is in line with the government’s push to early-stage companies through its Start-up India campaign. Earlier this year, the government introduced incentives for early-stage companies, including an income tax holiday, an inspectorraj-free regime and capital gains tax exemptions on investments in startups. It also launched a Rs10,000 crore corpus to provide funding for these firms.

Separately, in July, the capital markets regulator, the Securities and Exchange Board of India, introduced easier regulations for start-ups that want to raise funds from the equity markets.

According to News Corp VCCEdge, the financial research arm of News Corp VCCircle, start-ups witnessed 945 private equity deals worth $8.8 billion in the nine months ending September 2016, down 47.3% yearon-year.

Google to set up data centre in India by 2017 Google will set up its first India data centre in Mumbai by 2017, hoping to take on global incumbents such as Microsoft and Amazon, who have a presence in the country, and allow local customers to host their applications on the internet.

Google controls a majority market share in India in search, email and on smartphones through is Android operating system. It also has a significant presence in offering enterprise applications such as mail and other services, but lags behind Microsoft and Amazon in its cloud business.

Amazon has three data centres, one each in Mumbai, Delhi and Chennai, with over 75,000 customers, including taxi hailing app Ola, Tata Motors and television network NDTV, on its cloud. Last year, Microsoft set up three data centres in India offering its Azure cloud to local customers.

Google, which already hosts applications of its Indian customers such as Wipro, Ashok Leyland,

Smartshift by Mahindra & Mahindra, Dainik Bhaskar Group and INshorts. com on its global cloud platform, expects a India presence to service local customers faster. Google calls it data centre Cloud Region.

“By expanding to new regions, we deliver higher performance to customers. In fact, our recent expansion in Oregon resulted in up to 80 per cent improvement in latency for customers,” said Brian Stevens, vice-president, Google Cloud, in a statement.

Google Cloud Platform takes the infrastructure, machine learning and networking services used to power Google services and makes them available to businesses and developers to build high performance applications and data analysis at a low cost. As India’s start-up community continues to grow, Cloud Platform provides the full stack of services to build, test and deploy their applications, the firm said.

In addition to its focus on Indian customers, Google is continuing to build its partner ecosystem to support customers as they move to the cloud. In India, Google already has deep partnerships with a multitude of born-in-the-cloud partners including Searce CoSourcing, Cloud Cover, PowerUp Cloud and MediaAgility as well as global partners like Wipro, TCS, Tech Mahindra, PwC and Cognizant. The opening of the Cloud Region opens up newer opportunities for several new cloud partners who will benefit from building their services on Google Cloud, the firm said.

India fourth on Right to Information list India has ranked fourth in a worldwide comparative assessment of national legal frameworks for right to information, slipping a rank as Mexico replaced Serbia to head the list of 112 countries this year and pushed each of last year’s top five countries a notch lower.

Sri Lanka, at ninth spot, is the only other South Asian country to figure among top ten nations in the

ratings released on Wednesday to mark International Day for Universal Access to Information.

Developed by the Centre for Law and Democracy and Access Info Europe, the ratings are done on the basis of 61 indicators totalling up to 150 points to gauge a country’s legal framework.

Mexico scored 136 points, edging past Serbia, which ended up with 135 points. RTI experts said India slipped one rank this year not because of its own performance but because of Mexico’s surge. “Mexico has recently revamped General Act of Transparency and Access to Public Information and has outranked Serbia. This is why India has slipped a rank,” said Venkatesh Nayak, prog ramme coord i n at o r at Commonwealth Human Rights Initiative.

All countries in South Asia, barring Pakistan, scored more than 100 points. Pakistan remains at 89th spot.

As per the ratings, Arab countries are among the world’s weakest on this important human rights indicator, with only four of the 22 member states of the Arab League – Jordan, Sudan, Tunisia, Yemen – having RTI laws. “The popular myth ‘RTI is meant for developed countries while developing countries have other urgent issues of poverty, hunger, poor levels of basic services like education and health’ stands disproved once again,” said Nayak.

India jumps 16 spots on Competitiveness Index India jumped 16 places for the second year in a row to the 39th rank on the World Economic Forum’s (WEF) Global Competitiveness Index 2016-17. It was ranked 55th in 201516. This is the largest gain made by any country on the list.

Switzerland was ranked the most competitive country for the eighth consecutive year, followed by Singapore, the United States, the Netherlands and Germany.

The rankings measure countries’ performance on three indicators — basic requirements, efficiency India Newsletter • 15

Indian Embassy, Vienna

enhancers, and innovation and sophistication factor. Performance on these in turn is measured through sub-indicators.

“Thanks to improved monetary and fiscal policies, as well as lower oil prices, the Indian economy has stabilised and now boasts the highest growth among G20 countries. Recent reform efforts have concentrated on improving public institutions (up 16), opening the economy to foreign investors and international trade (up four), and increasing transparency in the financial system (up 15),” said the report.

On basic requirements, India jumped from 80th in 2015-16 to 63rd this year, with improvements seen in indicators such as institutions, infrastructure and macroeconomic environment. However, a mild slippage was observed on the health and primary education indicators.

On institutions, the country has jumped from 60th rank last year to 42nd, driven largely by improvements in indicators such as diversion of public funds and irregular payments and bribes, efficiency of legal framework in settling disputes, strength of auditing and reporting standards, and protection of minority

shareholders.

While an improvement on the former is likely to be the result of government initiatives aimed at curbing corruption, the latter probably reflects measures taken on corporate governance and related party transactions by authorities such as the Securities and Exchange Board of India (Sebi). Surprisingly, on reliability of police services, the country moved from 86th in 201516 to 53rd in 2016-17.

On infrastructure, the country’s ranking improved from 81st last year to 68th, with progress seen in the overall quality of infrastructure, roads, railways, port and electricity supply.

However, despite this, the “Lack of infrastructure (68th) and ICT use (120th) remain bottlenecks.

Improvement has been slow in recent years and further investment will be necessary, especially to connect rural areas and make sure they can equally benefit from and contribute to the country’s development,” it added.

Interestingly, the WEF report suggests the country has made significant progress on higher education and training. On the quality of education system, it has jumped from 43rd last year to 29th,

from 63rd to 44th on quality of math and science education, and from 48th to 30th on extent of staff training.

The country has also made rapid progress on prevalence of foreign ownership (from 96th in 2015-16 to 72nd in 2016-17) and on business impact of rules on foreign direct investment or FDI (from 92nd last year to 71st this year). Presumably, this was driven by the government’s initiatives to ease FDI norms.

The WEF report also says India has made tremendous progress on labour market efficiency with its ranking improving from 103rd in 2015-16 to 84 in 2016-17. Within this, India has jumped from 86th to 67th rank on cooperation in labour employer relations, 25th to 15th on hiring and firing practices, 47th to 33rd on pay and productivity, and 86th to 66th on reliance on professional management.

Notwithstanding the 16 place jump, the WEF report says “a lot needs to be done. The labour market is segmented between workers protected by rigid regulations and centralised wage determination (112th), especially in the manufacturing sector, and millions of unprotected and informal workers.”

INDIA PERSPECTIVES MAGAZINE ONLINE

www.magzter.com/publishers/meaindia

16 • India Newsletter

Indian Embassy, Vienna

MAKE IN INDIA Summary ■■ INR 204 Billion film industry by 2019.

■■ INR 1,026 Billion in 2014 revenues.

■■ Second largest TV market in the world.

■■ 168 Million television households in 2014.

■■ INR 45 Million animation industry.

■■ 800 TV channels.

MEDIA & ENTERTAINMENT

Reasons to Invest ■■ Total market size of the Indian entertainment industry stood at INR 1,026 Billion in 2014, growing by 14.2% over 2013.

■■ The industry is expected to register a CAGR of 13.9%, reaching INR 1,964 Billion in 2019.

■■ The size of the television industry in India was estimated at INR 475 Billion in 2014, with a projected CAGR of 15.5% to reach INR 975 Billion in 2019.

■■ India is the world’s second largest TV market, after China, with 168 Million TV households.

■■ India has a large broadcasting and distribution sector, comprising approximately 7800 satellite TV channels, 6000 multi-system operators, around 60,000 local cable operators, 7 DTH operators and few IPTV service providers.

Statistics ■■ India has 168 Million television households, 99,7000 newspapers, close to 2,000 multiplexes and close to 300 Million Internet users – second largest base after China, and is expected to reach out to 640 million by 2019.

■■ By 2019, digital advertising is projected to have the highest CAGR of 30.2%, while all other sub-sectors are expected to grow at a CAGR between 8% and 18%.

■■ Overall, the industry is expected to register a CAGR of 13.9% to touch INR 1,964 Billion by 2019.

Growth Drivers ■■ Television and AGV (animation, gaming and VFX) segments are expected to lead industry growth, with opportunities in digital technologies as well.

■■ TV penetration in India is about 61% and is expected to reach 72% by 2017, the digitisation of cable TV in India is in progress, direct-to-home (DTH) subscriptions are growing rapidly, driven by content innovation and product offerings.

■■ Growth in the number and spread of multiplexes.

■■ Increasing liberalisation and tariff relaxation.

■■ Measures such as digitisation of cable distribution to enable viewer’s choice and greater growth.

■■ Rising incomes and evolving lifestyles, leading to higher demand for aspirational products and services.

■■ Higher penetration and a rapidly-growing young population coupled with increased usage of 3G and portable devices to augment demand.

FDI Policy ■■ BROADCASTING CARRIAGE SERVICES: ■■ Foreign Direct Investment (FDI)

in Teleports, DTH, Multi-System Operator, cable networks in DAS areas, mobile TV, Headend-in-the-Sky Broadcasting Services are allowed up to 74% with FDI, up to 49% under the Automatic route. FDI beyond 49% (up to 74%) is permitted under the government route.

■■ FDI in local cable networks and MSO in non-DAS areas is allowed up to 49% under the Automatic route.

■■ BROADCASTING CONTENT SERVICES: ■■ FDI in FM radio is allowed up to 26% under the government route.

■■ FDI uplinking of ‘News and Current Affairs’ TV channels is allowed up to 26% under the government route.

■■ FDI uplinking of ‘Non-News and Current Affairs’ TV channels/ downlinking of TV channels is allowed up to 100% under the government route.

■■ PRINT MEDIA: ■■ 26% FDI under the government approval route is allowed in the publishing of newspapers and periodicals dealing with news and current affairs.

■■ 26% FDI under the government approval route is allowed in the publication of Indian editions of foreign magazines dealing with news and current affairs.

India Newsletter • 17

Indian Embassy, Vienna

■■ 100% FDI under the government approval route is allowed in publishing/printing of scientific and technical magazines/speciality journals/periodicals.

■■ 26% FDI under the Government approval route is allowed in publication of facsimile editions of foreign newspapers. However, foreign investment up to 100% is allowed in case of foreign publishing houses bringing out facsimile editions of their own newspapers through wholly owned subsidiary..

Sector Policy ■■ In December 2011, the Indian government passed ‘The Cable Television Networks (Regulation) Amendment Act’ for digitisation of cable television networks by 2014, cable operators under the digitisation regime are legally bound to transmit only digital signals, while customers can access subscribed channels through a set-top box (STB).

■■ In phase I and II, 33 Million STBs have been installed. For phase III and IV it is estimated that around 110 Million STBs will be required.

■■ Co-production treaties with various countries such as Italy, Brazil, UK and Germany are to increase the export potential of the film industry.

Financial Support ■■ PROVISIONS OF THE 2O152O16 UNION BUDGET: ■■ INR 1000 Million has been allocated to encourage the growth of community radio stations.

■■ INR 5000 Million has been allocated for launching a pan-India programme named Digital India and a national rural internet and technology mission for services in villages and schools, training in IT skills and e-kranti for government service delivery and governance scheme.

■■ INR 1000 Million has been allocated for launching a programme to promoting good governance.

■■ Basic custom duty on digital still image video camera with certain specification reduced to nil.

■■ Service-tax to be levied on 18 • India Newsletter

service provided by way of access to amusement facility, entertainment events or concerts, pageants, nonrecognised sporting events etc.

■■ STATE INCENTIVES: ■■ Available depending upon the number of jobs created, area of investment etc.

■■ Animation and gaming: incentives for units in SEZ as specified in the Act.

Investment Opportunities ■■ TELEVISION: ■■ Television is projected to garner half of the media and entertainment pie by 2015 (as addressable digitisation is expected to cover the entire country by then).

■■ Television advertisement revenue is also expected to witness robust growth and increase from INR 155 Billion in 2014 to a projected INR 299 Billion by 2019.

■■ India is emerging as the teleport hub of Asia. 86 teleport permissions have been issued by the Ministry of I&B. ■■ PRINT: ■■ The print industry has grown from INR 176.4 Billion in 2014 to reach INR 280 Billion in 2019 at a CAGR of 9.7%.

■■ Newspapers and niche magazines are likely to drive industry growth.

■■ Accelerated growth is forecast in regional print and local news segments.

■■ FILMS: ■■ The size of the Indian film industry is expected to reach INR 204 Billion by 2019, up from INR 126.4 Billion in 2014.

■■ An increasing number of digital screens and 3D films are expected to help industry growth.

■■ To promote joint productions, coproduction agreements have been signed with Italy, Germany, Brazil, UK, France, New Zealand, Poland, Spain, Canada, China and Korea. Agreement with Australia is in the pipeline.

■■ In order to promote India as a location destination for foreign production houses, the government is setting up a film facilitation unit with the help of National Film

Development Corporation for facilitation of film shooting in India.

■■ RADIO: ■■ The size of the Indian radio industry was INR 17.2 Billion in 2014 that grew at a CAGR of 14.5% from INR 10 Billion in 2010.

■■ The radio industry is expected to grow at a CAGR of 18.1% to reach to INR 39.5 Billion by 2019.

■■ Phase-III of e-auctions for FM radio licenses will provide an impetus to the segment.

■■ MUSIC: ■■ The size of the music industry is estimated at INR 9.8 Billion in 2014 and is expected to at a CAGR of 14% over the period 2014-19.

■■ Mobile VAS and the arrival of 3G is likely to lead to a surge in paid digital downloads.

■■ Phase-III radio licensing will also help in increasing music revenues from radio.

■■ ANIMATION & VFX: ■■ The Indian animation industry was worth INR 45 Billion in 2014 and is expected to expand at a CAGR of 16.3% reaching INR 95.5 bil by 2019.

■■ Growth in international animation films, especially 3D productions and the subsequent impetus for Indian production houses will further help growth in this segment.

Foreign Investors ■■ Walt Disney (USA) ■■ NBC Universal (USA) ■■ Ogilvy and Mather (USA) ■■ Bloomberg (USA) ■■ Sony (Japan) ■■ BBC (UK)

Agencies ■■ Ministry of Information & Broadcasting, Government of India ■■ Indian Motion Picture Producers Association ■■ Film and Television Producers Guild of India ■■ Newspaper Association of India ■■ Association of Radio Operators of India ■■ Indian Music Industry

Indian Embassy, Vienna

PERSPECTIVES ON INDIA India is lucky that it is so big that it doesn’t need the world: Johan C. Aurik Johan C. Aurik is the chairman and global managing partner of strategy consulting firm A.T. Kearney, a role he took up in January 2013. His expertise includes a wide variety of strategic issues for consumer goods and retail clients. He has co-authored books including The Future of Strategy and Rebuilding the Corporate Genome.

Aurik, who is in New Delhi as the co-chair of the World Economic Forum’s India Economic Summit, speaks about India’s economy, the government’s Make in India initiative, disruptive technologies and jobs in an interview.

Edited excerpts: ■■ What are your views on India and the economy?

I have been in business for the last 30 years and India was always a promise but never a reality even though it had enormous potential and a huge population. But what is wonderful is that for the first time there is a government here that is enabling change and driving change.

The economy is picking up, 7-8 % growth is massive and there is potential for much more. I became positive about two years ago and every year I am more positive.

The GDP growth, the jump of 16 spots in the competitive index, FDI (foreign direct investment) of $62 billion.

We do an FDI index every year and India was in the top 10 countries together with other big countries like Germany and the US. This demonstrates the country’s increasing attractiveness to foreign investors.

Prime Minister Narendra Modi’s government is committed to regulatory reform to attract future FDI inflows. GST was a miracle, I

thought it would never happen.

So, things are looking really good. I am very bullish on India today.

■■ While Make in India is a great initiative and has got off to an excellent start, how can we ensure its long-term success?

Make in India was launched two years ago, the original study was done in 2011 and ambitious goals were set. The government set clear goals for the manufacturing sector and the Make in India initiative to create 100 million new jobs by 2022.

These goals, however, may prove to be highly aspirational. Between 2010 and 2014, India created 4 million manufacturing jobs. At that rate of growth, the sector would only produce 8 million more jobs by 2022 — far below the 100 million target. And why is this?

First, the world economy is not growing and Make in India is exportdriven. Maybe India should Make for India and not for the world.

Two, the digital revolution affects any industry and it is in full swing— it is not adding jobs but taking jobs away at least in the short term. Yes, start-ups have been created but these are limited.

Three, to stimulate manufacturing you need infrastructure—and not much progress has been made in this area—that should be the first priority.

These are the three key reasons why job growth is not happening.

■■ How can we ensure job growth?

By focusing on India growth, Make for India and Indians and remember that manufacturing output for India needs low-cost goods that are simple rather than manufacturing something for New York or Paris.

Also, roll out more digital initiatives and reskill labour. Make in India will fuel inclusive and innovationled growth in India only when it is translated into jobs and this is also something that companies should

focus on.

In Germany, for instance, companies have a training programme for 16-18 year olds and provide them internships. Education does not only mean university-based education.

Advancements in technology such as artificial intelligence, machine learning and robotics are disrupting factory floors and changing the way they are run and managed. How does this impact India?

As the use of robotics becomes an increasingly critical part of manufacturing, location becomes less important. Consequently, India must develop a unique proposition to attract global manufacturers.

Simply relying upon policy changes and a large pool of workers will not work indefinitely.

Chinese competition remains strong and active. Although China’s manufacturing success stemmed from it being a low-cost hub, it has been climbing rapidly up the value chain. China is forecast to become the world’s largest user of industrial robots by 2017, with an estimated 430,000 robots expected to come online.

The second issue is that while automation is likely to increase productivity, it will also render some jobs redundant. India will have to find the balance between incorporating innovations into its manufacturing facilities with its need to create a substantial amount of new jobs.

Over the next 15 years, India will have the world’s largest workforce, with 1 million people joining the already 500 million-strong pool every year. These labour concerns are further complicated because agriculture, traditionally one of the biggest sectors of the Indian economy, has been shedding jobs.

Urbanization, and the success of Make in India is leading increasing numbers of Indians to seek a better life working on a factory floor, than India Newsletter • 19

Indian Embassy, Vienna

in the fields of a farm.

■■ What excites you about India today vis-à-vis the world ?

Like I said, I am bullish on India. You have 1.2 billion people and growing and population growth is the biggest driver of GDP. India doesn’t need the world like other nations do. Singapore can’t do it alone nor can a country like Switzerland, but India can.

Indian film industry to reach US$ 3.7 billion by 2020

By ANU P. MATHAI, IES, CHIEF EXECUTIVE OFFICER, IBEF The Indian film industry is expected to grow at a compounded annual growth rate (CAGR) of 11 per cent to reach US$ 3.7 billion by 2020, according to a recently released report from Deloitte titled ‘Indywood – The Indian Film Industry’. India is already the largest film industry in the world in terms of the number of films produced but lags behind the market leader US and other countries in revenues. India produces close to 1,500 to 2,000 films per year on an average but the per capita screens stand at 1 screen per 96,300 residents, as compared

20 • India Newsletter

You have a beautiful engineering system, English-speaking people, a good work ethic and business culture, companies like the Tatas and Reliance.

But of course the challenges are equally big. If you do not succeed in bringing the poor people up to the middle class, then people who are in power will most likely be voted out.

In contrast, the world is the new mediocre and will stay that way for

some time.

to 1 screen per 7,800 residents in the US and 1 screen per 45,000 residents in China. The current gross box office realisations of the industry stand at US$ 2.1 billion. With the domestic box office contributing a major share (74 per cent) of the revenue, the other segments like cable and satellite rights and online/ digital aggregation revenues are the fastest growing segments. In fact, the cable and satellite rights and online/digital aggregation revenues are expected to grow at a CAGR of about 15 per cent over the period FY15-20.

international/foreign films gaining share in the Indian industry, entry of international studios through acquisitions and collaborations, rise of regional cinema, digital adoption across the value chain, organic and inorganic growth in multiplexes and emergence of alternative streams of revenue are expected to shape the contours of the Indian film industry.

In addition, factors like an increasing per capita income, growing middle class, rising demand from tier II and tier III cities, diversification into international markets, increasing ancillary revenue streams and more use of visual effects (VFX) in movies can be expected to drive the growth of this industry in the domestic market.

The Indian film industry is dominated by the Hindi film industry contributing 43 per cent of the revenue. Other interesting trends like

Europe is muddling through, we will have to wait till November to see what happens in the US; Brazil is having major issues. So there are few growth engines in the world. Global trade continues to fall, globalization is under pressure.

So, I am not optimistic about global growth. India is lucky that it is so big that it does not need the world.

Indian Embassy, Vienna

INDIAN STATE ECONOMIC PROFILE PUNJAB Punjab, one of the northernmost states of India, is bordered by the Pakistani province of Punjab to its west, Jammu & Kashmir in the north, Himachal Pradesh in the northeast, Haryana in the south and southeast, and Rajasthan in the southwest.

The confluence of five rivers makes Punjab’s agricultural land rich and productive. Approximately 82 per cent of the state’s land is under cultivation

compared

with

the

national average of 40 per cent.

Punjab is also known as the ‘Bread Basket of India’ and led to first Green Revolution in the country. By 2025,

recorded at 7,125 thousand metric

policy and other incentives for the

tonnes. As per state budget 2016-

creation of textile infrastructure,

17, an amount of US$ 1.14 billion

the state offers opportunities for

has been allocated to the agriculture

investment.

and allied industries sector.

The average gross state domestic

Punjab has been ranked first in India

product (GSDP) growth rate for the

in terms of infrastructure facilities

state of Punjab was about 10.12 per

offered. Punjab’s road, rail and air

cent between 2004-05 and 2015-

transport

16. The state provides investment

network,

construction

of

connectivity, bridges

and

opportunities in sectors such as

infrastructure facilities are rated

textiles,

among the best. As of June 2016,

IT & ITeS, automotive and auto

Punjab had a total installed power

components, sports goods and light

generation

engineering goods.

capacity

of

12,936

agro-based

industries,

megawatt (MW).

■■ Key Sectors:

The state has attracted Foreign

■■ The

Direct

equity

contributed around 27.19 per cent to

Investment

(FDI)

agriculture

sector

inflows worth US$ 1.35 billion during

it is expected that the state will

the state’s GSDP in 2015-16 at 2011-

the period April 2000 to March

be among the leading producers

12 prices and provides livelihoods to

2016, according to data released by

of non-food grains as well as

more than 60 per cent of the state’s

Department of Industrial Policy and

exporter of various agri-products.

population. Food processing is

Promotion (DIPP).

considered to be a focus area in the

Punjab has easiest procedures to

state and the government has made

set up a business, according to

various efforts in aiding deserving

a study by the World Bank and

investments for the food processing

KPMG. Punjab had set up a Bureau

industry.

and 11 per cent of rice production.

of

This makes it suitable for agro-

■■ Punjab’s

in December 2013 for one-stop

incentives offered to the IT industry

based industries, dairy farming and

clearance of investment proposals.

are aimed at promoting Punjab as

products, and other food processing

BIP has powers to give approvals

an attractive destination for the

industries. During 2015-16, total

related to pollution control, excise

industry. Mohali has been developed

vegetable production in the state

and taxation, labour issues, factory

as an IT and ITeS hub in the state.

was 4.16 million tonnes, wheat

licences, boiler registrations, town

production stood at 17.10 million

■■ Punjab is among the largest

and country planning, land and

metric tonnes, and rice production

producers of cotton and blended

power-related issues.

yarn as well as mill-made fabrics

stood at 10.62 million metric.

Punjab has emerged as a key hub for

in India. Ludhiana is often referred

Punjab

agriculture

textile-based industries including

to as the ‘Manchester of India. The

base with the huge production

yarn, readymade garments and

state accounted for 15.47 per cent of

of principal crops. In 2015-16,

hosiery. With the development of

the country’s cotton production in

production

apparel parks, favourable textile

2015-16 (up to June 2015).

Occupying only 1.5 per cent of India’s geographical area, the state accounts for about 17 per cent of the country’s wheat production

has

strong

of

sugarcane

was

Investment

Promotion

(BIP)

IT

policy

and

the

India Newsletter • 21

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22 • India Newsletter

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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 maoffice.vienna@mea.gov.in 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 investindia@ficci.com www.investindia.gov.in

I

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 • 29

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TOURISM Orchha: Living in Legends

by Hugh & Colleen Gantzer.

New Delhi was conceived in Orchha.

Madhukar Shah, whose family once ruled Orchha wrote to us saying: “Lutyens, the architect of New Delhi, used (Orchha’s) palaces as his inspiration for his New Delhi buildings” Drawn by such tales of this medieval town, we headed towards legendary Orchha through the softness of an early November morn. Sixteen kilometres from Jhansi, this old capital of the Bundela rulers lies off the road in a palm-like hollow. It is gentled by scrub and thickets of custard apple, enfolded by rising hills and watered by the Betwa: a fairy-tale river that chuckles to itself as it meanders through this undulating land. On the eminences of this hillock-dotted terrain rise the Disney-scape towers of temples and the fluted domes of the old palaces. And between the daunting masses of the fortifications, and the towering heights of the oddly built temples, spreads the hamlet. Here

30 • India Newsletter

there are narrow streets where the halwai sizzles his sweet, succulent, golden jelabis; and the pot-bellied bania huddles over his books; and where the tiled roofs and the turquoise-coloured facades of the cottages hide cool courtyards where life has changed little since the days when the Bundela rajas threw up the walls and built the palaces, and raised the great gates that still stand guard over the dreaming hamlet.

We drove through one of these gates, past the bright village women; through the closely clustered hamlet; and crossed the great stone bridge. Arches straddled the natural moat of an encircling arm of the flowing Betwa. Beyond, rose the walls and balconied windows, the towers, domes and ramps of the fort. We raced up a steep incline, the wooded slopes falling away behind us. At the top, we turned, stopped and stepped out into an open court in the heart of the fort.

At our feet, beyond the crenellated walls, huddled the hamlet of Orchha, its flat-roofed houses punctuated by the towers of its temples. To our left rose a palace built by a Hindu king

for a Mughal Emperor: the Jehangir Mahal. To our right, on a lower slope, so that we gazed over its terraced roofs and towers, was the massive, hamlet-dominating palace of the Bundela rajas: the Raj Mahal.

Behind us were the whitewashed balconies and blue-enamelled tiles; the narrow, hidden, stairs; and the royal leisure rooms of the l8th century Raja Udait Shah: the plush Sheesh Mahal.

The Sheesh Mahal was to be our temporary home in Orchha. And, after the silent austerities of the abandoned palaces, it was almost too sybaritic for comfort: a rich resplendence of divans, carpets and mirrors, mirrors, mirrors, everywhere.

That then, was the setting: legends frozen in time: monuments enshrining memories of love, treachery, mythic splendour and war. And the simple lives of the people flowing endlessly through the little hamlet, their dreams and aspirations embroidered with fabulous tales of their royal past and the hope of the treasure-trove of tourist gold to come.

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One of these simple folk is Bindraban. He has an amazing fund of stories, easily tapping the fables and legends of his people, speaking of the glorious past as if centuries had not fled but only hours: myths and memories merge easily in his mind.

We followed him through the aromatic scrub and then stood against the crumbling, stone wall of the old, high-arched, elephant stables. “Observe,” he said, “the palace built for the Mughal” The Jehangir Mahal blocked our horizon: a huge, imperial structure with balconies, domes and a forbidding door.

Bindraban said: “We will walk closer.

And while we walk I will tell you the story of this building.”

We began to pick our way through the incense-dry grass, with the Jehangir Mahal looming larger and larger at every step. And Bindraban’s voice was a soft incantation, conjuring magic.

“When Raja Ram Shah was king and Raja Bir Singh Deo was his brother, the great Emperor Akbar was on the Mughal throne and his son Salim was his heir but had fallen out with his father …”

Madhukar Shah had elaborated on this dark aspect of history, saying: “The EmperorJehangir, when he was heir-apparent, asked Raja Bir Singh Deo to assassinate Abul Fazal, the Prime Minister of Akbar. The head was duly delivered to Prince Salim (as he was known then) at KaraManikpur near Allahabad. When Jehangir became Emperor, he gave the gaddi of Orchha to Raja Bir Singh and shifted his older brother, Ram Shah, to Chanderi.”

A palace to commemorate an act of royal skulduggery!

Jehangir Mahal towered above us now: all balconies and grilled windows and two stone elephants guarding its great portal.

Then we embarked on a magical mystery tour of the fort. In the first subterranean floor…”There are three more below”, said Bindraban,

“with l38 rooms under ground level” … bats twittered in the cool dark and flitted past on silent, leathery, wings. An army could have hidden here, and probably had. But, above the ground floor, both the Jehangir and the Raj Mahals rise in a series of corridors, chambers and stairways built around central courts, which let in light and air; or else are illuminated by a complex network of shafts and portholes which capture and divert sunlight into the inner rooms. And everywhere there are the domes, intricately carved window grilles, corbels and arches built in the Mughal, Rajput and Bundela styles.

These monuments were the eclectic masterpieces of their time.

The Jehangir Mahal, however, is far more elegant, with its elaborate ornamentation, than the Raj Mahal.

But the lower palace with the royal apartments, across the open entrance court and overlooking the roofs of the hamlet, have some beautiful frescoes of deities, and birds and foliage, and lissom women.

“One of the queens,” Bindraban said, “had her chamber in the Raj Mahal built so that she could look straight into the Chaturbhuj Mandir over there…” and he pointed to the nearer temple with its pine-cone spires catching the light.

We left the Raj Mahal behind us land drove down the ramp, away from the fort, across the bridge, through the hamlet and up a dusty village road.

The blue tiles of the Sheesh Mahal

were repeated on the blue façade of a hut. We stopped to let a bullock cart creak past the domed mansion of the l7th century poet Kesav Das; and then drove up through the scrub again.

At the end of the road, the Laxminarayan Temple stretches with deceptive angularity against the achingly blue sky. In fact it is a square structure, with battlements and corner towers surmounting a verandah. This verandah encloses a court open to the sun. There is a hall in the centre of this court and it leads to a strangely octagonal central shrine. Here, idols have been installed and a priest awaits devotees with his tray of flowers, sanctified water and vermilion powder.

It was all oddly reminiscent of the spotlessly clean, open-court, temples of Kerala.

There, the principal deities, too, are often situated in central, octagonal shrines. Also, the verandahs of Kerala’s temples are sometimes as beautifully embellished with murals as the domed ceilings and walls of this one were.

What was the strange connection between the Central Indian shrine and those southern ones? We do not know.

The murals fascinated us. Here gods and goddesses disported, warred with demons, contended with mythical monsters. “That is the Chungi-chiriya”, Bindraban said with awe, pointing. Up on the ceiling a India Newsletter • 31

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giant bird carried away six elephants in its mammoth trunk, clawed feet and tail; and was pecked on its round, elephantine head by an irascible peacock. Here, too, the War of l857 was fought again with the redcoats storming the citadel of the Rani of Jhansi. And, in sharp contrast to all these scenes of conflict, men and women danced under a floral print. On the verandahs’ walls other murals spoke of other events: two armed foreigners sat on cane chairs, drinking, while a pet dog barked in delight; all in sepia tones, rather like old photographs. Sadly, however, because they were more accessible than the colourful ceiling murals, they had been defaced by graffiti.

And, presiding over the entire, sunlit, court, was a serene Ganesh in an alcove, which looked as if it belonged to the cool, marble, serenity of a Jain temple.

It was late afternoon now and we had time for just one more monument.

We chose the Chaturbhuj Temple: the one on the knoll directly opposite the Raj Mahal.

Walking up to it, treading the long flight of stairs, we read the brief description of the temple given in a glossy booklet produced by the Environmental Planning and Coordination Organisation, Bhopal. It said: “This temple with its wonderful improvised style, and its magnitude, dominates the town area of Orchha.

As its name implies, it is dedicated to the ‘four-armed’ Vishnu, and its layout visually reproduces these four arms. Built by Bir Singh Deo (l606-l627), the temple stands on a huge stone pedestal, about l5 ft. high, reached by a large flight of steps leading up to a porch.”

As soon as we ascended to the temple, however, we were struck by its uniqueness: we have never, before, seen such a Hindu shrine.

After the arched porch, we stepped into a small court, open to the sky.

Beyond it was a great hall decorated with arches, arched niches in the walls and a high, central, dome.

Straight ahead, facing due west, 32 • India Newsletter

was a large, arched, recess in a rectangular frame. This was flanked by two arched chambers but, curiously, only the one on the right had steps leading up to it. And, apart from occasional floral patterns, there were no other decorations: not a single figure of human, demi-god, demon or beast.

We turned to Bindraban and asked, “Is there any strange tale about this temple? About it not being a temple, originally?”

Our guide frowned. “No tale like that,” he said, “but they say it was first built for the worship of Ram. But the idol of Lord Ram, brought from Kashi, settled itself in another place and refused to be shifted. So, later they installed the idol of Lord Vishnu.”

Possibly. And, then again, possibly not.

It is likely that Bir Singh Deo built a great mosque for Jehangir, along with the Jehangir Mahal, when the Mughal Emperor came to the raja’s investiture in l606. When the Mughals left, the ablution well was filled in and a suggestion was probably made that the mosque should be converted to a temple.

But the priests of Ram declined.

Later, the priests of Vishnu accepted the offer. The mosque became the temple of Chaturbhuj.

Significantly, the doorframe of the square Laxminarayan Temple has the typical rectangular shape of a temple portal, and it is decorated by two lions on brackets. But the doorframe of the Chaturbhuj Temple is arched and is embellished only by an abstract, floral, pattern: Islam forbids the depiction of men and beasts in such settings.

We returned, thoughtfully, to our opulent room in the Sheesh Mahal at dusk. Through our window we could see the ruins of the old hamam, the public bathhouse: another typical Islamic feature. When we had walked in the ruins we had traced the old furnaces, the hot water bath, the chilled pool, the hot air shaft, the steam and massage rooms, and the chamber of the Keeper of the Bath.

We had also visited the doublestoried mansion of Rai Parveen, the great singer-courtesan who was the favourite of Raja Indramani. Of her, Madhukar Shah had said: “Many legends are connected with Rai Parveen. The great Hindi poet Keshav Das was associated with her.”

“Tell us a legend connected with Rai Parveen”, we asked Bindraban.

He coughed delicately to indicate that he did not think it was a tale suitable to be told before a lady; but when both of us nodded in reassurance he shrugged slightly and said: “She was very beautiful, very beautiful”, he paused, as if seeking our confirmation.

We nodded again. “And she was very talented; very talented and the star pupil of Keshav Das.” We nodded again. “So then news of her beauty and talents spread to the far corners of the earth and Emperor Aurangzeb demanded that she come to his court. She knew what this meant; she knew exactly what this meant. Also her king, Indramani, did not want to lose her to the Mughal. But then the Emperor, he said: ‘If you do not send her I will impose such a fine on you as the whole kingdom cannot pay’.

Even so the Raja was loathe to let her go. But then she … for she was very clever … she consulted with the great Keshav Das and convinced her Raja that if let her go, she would return untouched by the Mughal.

Bindraban paused, building up suspense, working to the climax of his story.

“So she went with all ceremony to the court of the great Aurangzeb.

And she appeared in his presence and that of all the mighty people of the Empire. And the Emperor asked her to recite a poem. She had been prepared for this by her mentor, Keshav Das. She said,…” he cleared his throat, closed his eyes, began to sway slightly as he intoned: “Listen to Rai Parveen, my Emperor, Listen to Rai Parveen.

Three things only scavenge from others, Three things only are seen:

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Dogs and crows and the scavenger crew. Tell me, O Emperor, Of which breed are you?”

Bindraban opened his eyes and looked at us. “The Emperor was so ashamed that he let her return without touching her”, he said. He got up, wished us, and vanished into the night.

The cool, still, starlit darkness of Orchha settled around us and we slept with great contentment.

Dawn blushed on the towers of the Laxminarayan Temple, raced across our terrace and, entering our room, was caught and fractured by the mirrors. After breakfast, we walked through the hamlet to ‘Hardaul’s Palace’.

Hardaul was a great wrestler and a brother of the weak Jujar Singh, who ruled after Bir Singh Deo. Suspecting his wife of having an adulterous affaire with his brother, Jujar Singh ordered the distraught woman to poison Hardaul. In tears, she took the poison to the noble wrestler and told him what her husband had ordered her to do. Hardaul said: “It is my duty to obey my elder brother”, and swallowed the fatal draught.

Ever since then he has become a folk hero, and is worshipped, and songs are sung in his honour. And when the folk of Orchha celebrate a wedding, they lay the first invitation on the royal wrestler’s memorial.

We walked across the plaza where people had assembled for a temple festival. Two tall towers stood on one side. We strode past them, through a door and into a water garden.

Ponds and little canals had been laid out and workmen were restoring a pavilion under the watchful eye of a young engineer.

The engineer told us: “In Hardaul’s time, 350 years ago, the water used

to be raised by animal-powered Persian wheels to a reservoir on top of the walls.” He pointed to a far corner. “From there it flowed through these ceramic pipes to these water courses and the fountains.” And then he added proudly, “We have cleaned out these pipes and we fill the reservoir with an electric pump; but the rest is all the same. Look!”

“How is it so cool and dry here?” we asked. “And so well ventilated, too?”

Slowly, water began to spray out of the fountains, getting higher and higher all the time till it was a feathery plume before our eyes.

We returned to the Shesh Mahal for lunch, still filled with the wonder of Orchha. Later, we crossed the river and sat on a grassy bank watching a herd of goats being driven home across an oddly English looking bridge. Then, the mist began to rise from the river and from the sleepy hollows. The outlines of the battlements and the towers blurred and, gradually, vanished against the darkening sky.

They showed us other things too: a pavilion where concealed piped once let in ‘rain’ from the ceiling to cool summer-scorched bodies; a huge, stone, wine cup large enough to take a bathing courtesan; and a vast and pillared ‘entertain hall’ linked to the Raj Mahal and, possibly, to Rai Parveen’s Mansion.

“Those two tall towers,” the engineer explained, “They are ventilation shafts for this hall” We learnt that these Persian chimneys are so designed that winds blowing across them create updrafts which suck out air from below, leaving the hall as cool and dry as we found it.

Then, in the stillness of the night, Orchha fell asleep.

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