India newsletter 01 2015

INDIA NEWSLETTER www.indianembassy.at

Published by the Embassy of India, Vienna Year 5 • Issue 49 • January 2015

MAKE IN INDIA AVIATION

India Newsletter • 1

Embassy of India, Vienna

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

■■ Infrastructure Development

■■ Manufacturing Growth

■■ Skill Development

■■ Energy Sufficiency

■■ Improved Business Environment

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NEWS FLASHES

01

Power generation in India has grown at a pace of 10.76 per cent during April-November 2014, the fastest over a five year period.

02

Net investment in the Indian equity market by foreign institutional investors (FIIs) is slated to exceed Rs 1 trillion (US$ 16.17 billion) for the third straight year in 2014.

03

The purchasing managers' index (PMI) for services in India rose to 52.6 in November 2014, indicating the fastest expansion in five months.

04

The desalination business in India is expected to grow threefold to reach US$ 1.9 billion by 2019 to account for 14 per cent of the global desalination market.

05

Foreign tourist arrivals (FTAs) in India grew by 7.1 per cent during January-November 2014, in comparison to the corresponding month last year.

06

Commercial vehicle sales in India grew 9.05 per cent in November 2014, led by a 40.14 per cent growth in sales of trucks and buses.

07

The fashion and imitation jewellery market in India has an estimated market size of Rs 15,000 crore (US$ 2.41 billion).

08

Indirect tax revenue (provisional) collections in India increased to Rs 328,662 crore (US$ 52.64 billion) during AprilNovember 2014 from Rs 306,814 crore (US$ 49.14 billion) in April-November 2013.

09

The private security services industry in India is expected to register a growth of over 20 per cent in the next few years, doubling its market size to Rs 80,000 crore (US$ 12.78 billion) by 2020.

10

Exports from India were valued at US$ 25.96 billion during November 2014, as compared to US$ 24.2 billion during November 2013, registering an increase of 7.27 per cent.

11

Foreign tourist arrivals (FTAs) in India registered a positive growth during each of the last three years and grew by 7.1 per cent during JanuaryNovember 2014.

12

The Ministry of New and Renewable Energy (MNRE) aims to achieve 100 megawatt (MW) of biomass power during 2014-15 and 400 MW during the 12th Five Year Plan period.

13

Sugar output in India rose 27 per cent to touch 7.46 million tonnes (MT) in the ongoing season's first quarter (October-December 2014).

14

Overseas investors pumped in a record Rs 1.6 trillion (US$ 25.27 billion) into the Indian debt market in 2014.

15

Over 20 firms in BSE 500 more than tripled their stock prices since November 2010.

16

India is expected to exceed 200 million smartphone users, topping the US as the world's second largest smartphone market by 2016.

17

India has installed 3 gigawatts (GW) of solar power and aims to reach 22 GW by 2022.

18

Private equity (PE) funds have invested US$ 11 billion into Indian companies in 2014, an increase of 11 per cent over the last year.

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Embassy of India, Vienna

NEWS ARTICLES India well on its way to becoming a $5 trillion economy by 2025

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ndia is well on its way to becoming a $5 trillion economy by 2025 (and thus the third largest on this planet after China and the US). By 2018, it will overtake Britain and become the largest economy in the Commonwealth.

The first trillion took India 60 years post-Independence, the next trillion will happen in another 10, and the next three trillion can happen in yet another 10 years!

A tide of rising expectations has pushed the sensex up from 21,140 on January 1, 2013 to 27,499 as the year ends, an almost 30% increase (in comparison FTSE 100 dropped by 6% over the same period). And a stunning minimum support price decrease, not increase, of 0.3%, coupled with favourable oil prices, will hopefully push it up next year as well.

However, there are significant policy and structural issues to overcome on this journey. Growth can happen in case of a triangulation of good policy and reforms, increased globalisation and political stability and will at the Centre. With a single party now in power in about 2/3rd of India's states it should be easier to nudge them on state-level reforms, where much of the action is expected.

India needs tonnes of growth in the years ahead, starting with 6% per annum and going up to 10% and more for at least two decades, for its per capita income to rise significantly and leave poverty behind. Gazing into the crystal ball, what does India need to do in 2015 for laying the foundations of this mega growth? India remains one of the least globalised economies in the world even after two decades of economic reforms. Pankaj Ghemawat's Global Connectedness Index shows India at 126th out of 140 countries ranked. While some

4 • India Newsletter

of this can be explained by India's large domestic market, having only 17% of our GDP accounted for by merchandise exports and 8% by services exports is frankly nothing to write home about.

Falsely attributing domestic weaknesses to globalisation forgets the fact that it would open up significant opportunities for domestic firms to do business overseas as well.n

Prime Minister Narendra Modi emerged as star performer on world stage

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mergence of Prime Minister Narendra Modi as a star performer on the world stage was the highlight of Indian foreign policy during 2014 which was described by External Affairs Minister Sushma Swaraj as truly a "Year of Breakthrough Diplomacy".

Modi's diplomatic outreach was evident the moment he took over as Prime Minister with the leaders of SAARC countries attending his swearing-in ceremony. His visit, thereafter, to the US, Japan and seven other countries confirmed his status as major global figure.

Summing up the Modi government's diplomacy in 2014, Swaraj said, revitalising traditional ties, resetting strategic relations and reaching out to Indians abroad have been primary to India's diplomatic efforts.

Noting government's 'neighbourhood first' policy, Swaraj said India was in forefront of helping its neighbours- be it Maldives which faced a grave water crisis or 'Made in India' defence exports to Nepal.

"They are all a reflection of our government's vision of India's shared future as an integral part of a peaceful, secure and prosperous comity of nations in South Asia, and the world beyond," she said.

Modi's summit level engagements

with strategic partners like the US and Russia with major substantive outcomes, were a major part of our diplomatic success story of the past six months, the minister noted.n

India becomes fastestgrowing, third-largest market for Dell

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ichael Dell's decision to take Dell private in 2013 has started showing signs of change for the company in India, where it has grown to become a $2-billion entity.

Growing at close to 50% in the last one year, India has now become Dell's third largest market in terms of revenue after the US and China.

"Our pace of growth makes India the fastest growing market for Dell globally and India has now emerged as the third largest market for Dell, next only to the US and China," Alok Ohrie, managing director at Dell India, told ET. "India is also the largest workforce for Dell outside of the US and representative of every single business of Dell.

The company has been rapidly growing in most of the segments it is present in. As per market research firm IDC's latest India PC market report, Dell has inched closer to the top position in the third quarter of 2014 with 22% market share, trailing HP by 3.5% in terms of total number of units.

For the same period last year, the company was the third largest player with only 11.8% marketshare. "In the server business, we have grown at an even faster rate," Ohrie said.

The growth has been driven by the company's aggressive expansion in smaller towns and cities, using partners to sell its products instead of selling everything directly to the customer, and due to IBM's exit from the entry-level server business.

Dell India has completely revamped its go-to-market strategy in India post privatisation—trying to offer

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integrated solutions to enterprises as it attempts to fill in a void created

by IBM's exit from commoditised x86 server business.

"We are in a very unique position because now we are the only company in the IT industry with truly end-to-end solutions, starting from tablets to cloud computing and everything in between. That is our biggest strength in the market," Ohrie said.

Dell went private in November last year after CEO and founder Michael Dell acquired the company with the help of private equity firm Silver Lake Partners for $24.9 billion. In an interview with ET in January, Dell said "Privatisation just gives us an enormous amount of freedom to execute in the way we believe is the right way and that is for me incredibly energising.

With its new aggressive go-tomarket strategy, Dell has expanded its presence from 15 top cities to 45 cities in the country. The company is also now using distributors to sell its PCs, notebooks and entry-level servers and storage. This has given the company access to additional 1,000 towns in India.

"In the last 6-12 months, Dell has been moving up the value chain, targeting solutions like virtualisation, cloud and mobility to large enterprises in India," said Naveen Mishra, research director at Gartner. "They are trying to have more feet on the ground, which has helped them win some large deals."

Not only did the renewed strategy help the company expand its presence in the country, but has also enabled them to sell larger IT solutions to companies instead of selling just servers and storage— thus improving profitability as well.

"The model has expanded our IT solutions capability by the addition of new partners with different skills that we did not have. We can now offer everything together as an endto-end solution," Ohrie said.n

Indian economy has potential to grow at a higher rate: FM

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he Union Finance Minister Shri Arun Jaitley said that the world economy is passing through critical phase while Indian Economy has potential to grow at a higher rate. In this regard he specifically mentioned about unexploited potential of the manufacturing and infrastructure sectors in particular. The Finance Minister Shri Arun Jaitley was speaking to the students of Stanford University, USA. The Finance Minister Shri Jaitley further said that various welfare programmes of the Government for vulnerable sections of the society are essential and working well. In this regard he mentioned about food security and education for all programmes among others. The Finance Minister shared with the students the various initiatives taken by the new Government to bring the economy back on the track.

Shri Rajiv Mehrishi, Finance Secretary and, Dr. Arvind Subramanian, Chief Economic Adviser, Ministry of Finance were also present on this occasion among others.n

India moves up a rank in list of most valuable nation brands

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he Modi effect helped India move up a spot to No.8 in a ranking of the world’s most valuable nation brands released by UK-based brand consulting firm Brand Finance.

The US remained No.1 with a valuation of $19.3 trillion, while China came in at No.2 with a valuation of $6.4 trillion. India had a valuation of $1.62 trillion, according to the consulting firm which ranked 100 countries.

“Though the appointment of India’s new Prime Minister Narendra Modi was greeted cautiously by many Western governments, he has provided a renewed sense of purpose to India’s bureaucracy, improving confidence at home

and abroad in the ease of doing business there. The India Brand Equity Foundation is reinforcing that message, providing a gateway for investors by providing information on India’s products, services and business climate with the aim of promoting international awareness of the Made in India label in markets overseas,” the Brand Finance report said.

Nation Brand Value is calculated by combining the Brand Strength Index (BSI) score—determined by reference to performance across four “pillars”; goods and services, tourism, talent and investment— with gross domestic product (GDP) data.

“The states of the 21st century are participants in a global marketplace, with intense competition for tourists, students, the best workers and investment. The results of this year’s Brand Finance Nation Brands report show the advantages that a strong nation brand can confer; the effect of a country’s image on the brands based there and the economy as a whole makes a nation brand the most important asset of any state. Governments, trade bodies and businesses must take steps to ensure that their nation brand is strategically appropriate, wellmanaged and regularly monitored in order to maximize the benefits,” said David Haigh, chief executive, Brand Finance.

The top five nations remain unchanged from 2013; Germany, the UK and Japan came in third, fourth and fifth, respectively. The lower half of the top 10 saw more significant changes.

Both Canada and Australia also rose in the rankings—to No.6 and No.9, respectively.

Brazil fell from No.8 to No.10.

The Brand Finance Nation Brand report also looked at the “strongest” nation brands. Germany topped this listing.

“Despite fairly flat growth of late, Germany remains Europe’s powerhouse with an almost unrivalled reputation for quality India Newsletter • 5

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manufacturing and efficiency.

Unemployment is falling and the country’s World Cup win has, to a limited extent at least, generated a positive ‘halo’ effect,” the report said.

Singapore and Switzerland followed at No.2 and No.3, respectively. The strength of a nation brand, according to Brand Finance, is determined by the country’s performance across four pillars; goods and services, tourism, talent and investment. The scores in each area are combined to produce an overall Brand Strength Index.n

India will overtake China in 2016: Goldman Sachs

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oldman Sachs sees India embarking on a new growth cycle, aided by healthier macroeconomic numbers, structural reforms by the government and higher investments.

This might help make India the fastest growing major economy in calendar year 2016, overtaking China for the first time, the investment bank said.

Goldman Sachs expects India to grow at 6.3% in calendar 2015, 6.8% in 2016 and at 7% or more till 2018. China’s growth rate in 2016 is expected to slow to 6.7% from 7% in 2015.

According to Goldman Sachs’ chief India economist Tushar Poddar, lower fiscal and current account deficits and falling inflation, helped by lower commodity prices, and structural reforms being implemented by the new government will help boost the investment cycle in India.

“We expect potential growth to rise from 6% in 2014 to 7% by 2018 due to rising productivity growth, in part due to increases in technology penetration, and acceleration in capital spending,” Goldman Sachs’ Asia Economics Analyst report, published on 1 December, said.

Incidentally, India’s potential growth rate was 7% a few years ago, but has come down due to lack of capex expansion and policy reforms, Poddar said in an interaction with 6 • India Newsletter

the media to discuss the contents of the report.

Poddar said signs of economic recovery are evident from rising demand, higher commercial vehicle sales, shrinking credit spreads, long end bond yields coming down and equities markets that are at a record high.

Once the states and the central government start awarding big projects to private contractors, revival in the investment cycle will gather pace. For now, the governments are awarding such big contracts to government-owned firms, Poddar said.

The Telangana government in September awarded two big engineering, procurement and construction contracts to Bharat Heavy Electricals Ltd (Bhel).

Goldman Sachs expects medium to high probability of some structural reforms taking place in the next few years and that should address macroeconomic impediments and reverse the lost economic momentum. It expects labour reforms to happen slowly. Indian firms will soon see better cash flow and balance sheet stress will reduce, the investment bank said.

Goldman Sachs is bullish on Indian equities for calendar 2015, but does not expect foreign investors to be able to put as much money in Indian debt as they did in 2014. On a net investment basis, foreign investors have year-to-date bought $25.32 billion in Indian bonds; their equity investment for the same period has been $16.43 billion. This is the first year when foreign investors put more money in Indian debt than in equities.

According to Goldman Sachs, the energy sector has a low valuation but will likely grow at a high rate in the next few years. The bank is also bullish on banks even as there could be some valuation risk, said Goldman Sach’s co-head of macro research in Asia, Timothy Moe. Goldman Sachs expects the rupee to significantly appreciate against the euro but remain in a tight

range against the US dollar. That is because the dollar has been gaining strength against all currencies, led

by US economic recovery. “Against the dollar, the best the rupee can do is remain flat,” Poddar said.n

India's steel output outpaces world average

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ndia's steel production grew at 4.8% in November outpacing the world average of 0.1% growth in November. During the month, India produced 6.89 million tonne (mt) of steel compared to 6.57 mt in the same month in 2013.

With domestic production touching 76.19 mt during the first eleven months of calendar year (JanuaryNovember 2014), India maintained its position as the world's fourth largest steelmaker in 2014, like in the last four years, according to data released by Brussels-based World Steel Association (WSA).

China, Japan and the US were ahead of it in global rankings as the world's largest steel producers.

The WSA, a top global body that collates data from 65 countries which accounted for 98% of global steel in 2013, said world steel output touched 130.52 mt in November 2014 against 130.42 mt a year earlier.

Lower production in China was mainly responsible for the subdued growth in the world average growth rate of steel, which is the largest producer and consumer of steel in the world.

Steel production in China declined by 0.2% to 63.3 mt in November 2014, compared to the same month last year.

During November, Japan produced 9.17 mt steel, the US 7.2 mt, South Korea 5.91 mt and Russia 5.84 mt.

China remains the top producer of the metal during the period at 748.67 mt.Japan also maintains second position with a production of 101.66 mt and the US at the third slot with 80.95 mt during the first 11 months of the current year.

In the European Union, Germany produced 3.6 mt of crude steel in

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November 2014, a decrease of 1.9% compared to November 2013. Italy produced 1.9 mt of crude steel, down by 13.9% on November 2013.

France's crude steel production was 1.4 mt, an increase of 5.8% compared to November 2013. In November 2014, Russia produced 5.8 mt of crude steel, up by 5.8% over November 2013.However, Ukraine saw a significant decline in crude steel production by 28.6% to 1.8 mt, compared to the same month in 2013.n

Government of India signs agreements with Germany for financial cooperation to support GEC Project

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he Government of India signed Note of Exchange with Government of Germany for financial cooperation to support “Green Energy Corridors (GEC)” project under Indo German bilateral Development Cooperation. GEC project in power sector aims to create transmission infrastructure in the renewable energy potential rich states and facilitate evacuation of renewable energy (RE) into the national grid. Government of Germany in the year 2012 had indicated its willingness to support the GEC project with funds amounting to Euro 1 billion over a period of five years under the ambit of Indo-German bilateral development cooperation.

Government of Germany has committed funds amounting to Euro 500 million for GEC project last year.

In this regard, the Note of Exchange, signed by the German Ambassador, was presented to Mr Rajiv Mehrishi, Finance Secretary, Government of India by Mr Heiko Warnken, Head of Development Cooperation, Embassy of Germany to India. With this, the total commitment from Government of Germany for GEC project stands at Euro 750 million. In year 2013, Government of Germany had committed Euro 250 million.

On the occasion, three separate loan agreements were also signed

for GEC project amounting to Euro 625 million. Mr Rajesh Khullar, Joint Secretary, Department of Economic Affairs, signed loan agreements with German Government’s Development Bank KfW, for loan of Euro 76 million to the Government of Tamil Nadu and a loan of Euro 49 million to Government of Rajasthan for intra-state transmission schemes.

Power Grid Corporation of India Limited signed loan agreement for Euro 500 million with KfW for interstate transmission schemes.

During the ceremony, Agreements were also signed by the Department of Economic Affairs with KfW for a grant amount of Euro 2 million to provide technical assistance to “Himachal Pradesh Forest Ecosystems Climate Proofing project” and also for a grant amount of Euro 2 million for extending technical assistance for the ongoing “Tamil Nadu Urban Infrastructure Development Fund project”.

Germany and KfW are longstanding partners of India. Since the 1950s, sectors like Energy, Protection of the Environment and Natural Resources and Sustainable economic Development have received KfW support.n

India, Russia expand engagement

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ndia and Russia signed several agreements, some worth billions of dollars, in areas spanning civil nuclear cooperation, defence, energy and diamonds as the two nations strengthened their ties during Russian President Vladimir Putin’s one-day visit to the country.

New Delhi and Moscow also pledged to increase the bilateral trade between them.

The visit, and the deals, come against the backdrop of Western sanctions on Moscow for its support of pro-separatist Ukranian rebels and a little over a month before US president Barack Obama will visit India to be the chief guest at the Republic Day Parade on 26 January.

Russia also expressed support for

Prime Minister Narendra Modi’s “Make In India” programme aimed at reviving the manufacturing sector—agreeing to build helicopters in India for exports, locate manufacturing facilities in India for spares and parts used in Russian defence equipment that were part of the Indian inventory, and source components from the country for the construction of at least 10 nuclear plants in India.

The two countries will also “explore opportunities for sourcing materials, equipment and services from Indian industry for the construction of the Russian-designed nuclear power plants in third countries,” an Indian government statement said.

Key deals signed included those between Russian energy major OAO Rosneft with India’s Essar Oil Ltd for importing crude oil over a 10year period and Russia’s diamond mining group Alrosa signing a pact worth $2.1 billion for the direct sale of rough diamonds to Indian companies. Currently, these diamonds come to India, where 90% of the world’s stones are cut and polished, through Belgium and Dubai.

Modi described his guest as a “leader of a great nation with which we have a friendship of unmatched mutual confidence, trust and goodwill”.

“We have a strategic partnership that is incomparable in content...

The character of global politics and international relations is changing.

However, the importance of this relationship and its unique place in India’s foreign policy will not change,” he added.

Referring to India diversifying its sources of procurement of defence hardware in recent years, Modi said: “Even if India’s options have increased, Russia remains our most important defence partner.

Modi’s words of support drew appreciation from Putin, who welcomed “the friendship, trust and mutual understanding with Indian partners”.

The comments come against the backdrop of Putin being coldIndia Newsletter • 7

Embassy of India, Vienna

shouldered by the US and European nations over Moscow’s support to Ukranian separatists and Russia’s annexation of the Russian-speaking region of Ukraine, Crimea, earlier last year. Falling oil prices and a weak economy have deepened the impact of Western sanctions on the Russian economy.

“This is an opportune moment for India and Russia. Putin is looking for international legitimacy and the relationship with India is critical,” said Anuradha Chenoy, a professor of Russian and Central Asian studies at New Delhi-based Jawaharlal Nehru University.

“With Western sanctions in place, Russia is looking at Asia to mitigate them. India does not support the sanctions imposed on Russia by the US and European countries. Russia on its part has banned imports of some commodities from Europe. So this is the opportune moment for India to step in and fill the gap,” she said.

The other pacts signed between the two sides included one between Acron of Russia and India’s NMDC Ltd to acquire stake in a potash mine in Russia, another between Tata Power Co. Ltd and Russia’s sovereign wealth fund, the Russian Direct Investment Fund (RDIF), to explore investment opportunities in the Russian energy sector, and a third between India’s IDFC Ltd and RDIF on a co-investment opportunity of as much as $1 billion.

Both countries also signed a “Strategic Vision for Strengthening Cooperation in Peaceful Uses of Atomic Energy” and a “programme of cooperation under Framework of Inter-governmental Agreement for Enhancement of Cooperation in Oil and Gas”, according to the ministry of external affairs.

A joint statement issued by both sides encouraged Indian companies to “strongly participate in projects related to new oil and gas fields in the territory of the Russian Federation”.

On defence, the two sides will seek to move ahead with long-delayed 8 • India Newsletter

projects to develop a joint fifthgeneration fighter jet and a multirole transport aircraft, in addition to the advanced helicopter.

“What the outcomes show is that there is no cooling of ardour in the India-Russia relationship; it is as strong as before,” said a government official who asked not to be identified. “There is a definite economic content and outcome” to the visit, the person added. Bilateral trade between the two countries has stagnated at $10 billion for the past two years and Indian officials are hoping that Putin’s visit would act as a catalyst in that area.

Former Indian ambassador to Turkey and Russia specialist M.K. Bhadrakumar said that Putin’s visit had resulted in “specific projects” being identified for action between the two countries. “Russia is going to calibrate its projects in India in such a way that it fits in with the Make In India campaign. This is the major difference in this visit.

The relationship has become more business-like, that is good. It puts India in a stronger position so that when President Obama comes visiting in January, India will be in a better position to bargain and wrest a better deal.

In effect, Putin’s visit is an indication that India’s foreign policy isn’t becoming US-centric.

Chenoy said that India’s reiteration of support for Russia and the pacts signed “asserts India’s independence in foreign policy and shows that India is capable of developing independent bilateral relations with the US and Russia”.n

3 Kerala companies have more gold than Sweden, Singapore, Australia

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hree gold loan companies in Kerala have more precious metal in their vaults than the gold reserves of some of the richest nations.

Muthoot Finance, Manappuram FinanceBSE -2.51 % and Muthoot Fincorp jointly hold nearly 200 tonnes of gold jewellery, which is

higher than the gold reserves of Singapore, Sweden or Australia.

India accounts for approximately 30% of the global demand for gold, a true-and-tested source of insurance for millions of families that have little access to other forms of social security. What is true for India is even more so for Kerala, where 2 lakh people are employed in the gold industry. The metal's fungibility makes it an ideal collateral for overthe-counter loans.

Muthoot Finance BSE 0.26 % holds 116 tonnes of gold as security for its loans, Manappuram Finance has 40 tonnes and Muthoot Fincorp, 39 tonnes. The trio's combined holdings are 195 tonnes. To put things in global perspective, Singapore's gold reserves are 127 tonnes, Sweden's 126 tonnes, South Africa's 125 tonnes and Mexico's 123 tonnes.

Muthoot Finance, the largest of Kerala's gold loan companies, holds more yellow metal in its vaults than the reserves of Greece (112.4 tonnes), Australia (79.9 tonnes), Kuwait (79 tonnes), Denmark (66.5 tonnes) and Finland (49.1 tonnes).

India, according to the World Gold Council, has the 11th largest gold reserves, with 558 tonnes. The US heads the pack with 8,134 tonnes, while Germany and IMF come next (3,384 and 2,814 tonnes, respectively).

"Historically, Malayalis have excelled in financial services as an ethnic group. The size of these companies reflects their innovative skills. Gold loan business also reflects Malayalis' hunger for gold and the strong dowry system which feeds gold and gold loans," said CJ George, founder and managing director of stock broking firm Geojit BNP Paribas BSE -0.41 % It was even better a couple of years ago. Muthoot Fincorp, which has a gold loan portfolio of Rs 8,550 crore, then had 41 tonnes of gold in its vaults. "Then, two things happened - gold prices declined and banks became aggressive in gold loans. As gold prices declined, our business

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also came down slightly, reflecting on our gold holdings," said Thomas John Muthoot, chairman and managing director of Muthoot Fincorp.

Muthoot Finance is the largest gold loan NBFC with a reach of over 4,265 branches across 21 states and four Union territories.

Its gold loan portfolio is Rs 21,800 crore. Manappuram Finance has 3,200 branches nationwide and 20,000 employees, with a gold loan portfolio of Rs 9,000 crore.

EU hopes to seal free trade pact with India next year

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he Free Trade Agreement between India and the European Union is expected to materialise this year once the country finalises its new foreign trade policy, a top official has said.

"We are actually not very far from the agreement but we are not there yet. I am quite positive that next year or so it would be possible to finalise the free trade agreement," EU Ambassador Joao Cravinho said.

He said parties on both the sides are engaged in good political conversations and there has been a commitment from both the sides on finalising the FTA. "The Indian government has been a little slow; slower than we wanted to, in producing the new trade policy," the envoy said, but added that as the trade agreements last for as long as 15-20 years, a delay of a few months in policy formulation is not relevant.

Commerce and Industry Minister Nirmala Sitharman had in September said that the new fiveyear FTP would be different from the previous ones and hopefully announced soon. The policy is expected only from April next.

Earlier, the government had planned to introduce a new FTP immediately after the Budget in July but it has been delayed reportedly on account of some tax related issues between certain ministries.

"We expect that in the new year we

will see a new trade policy. Once that happens, we will be able to sit down again and resume our negotiations," Cravinho added.

The EU is open for an asymmetrical agreement, he said, adding, however, that both sides must be agreeable for a little bit of give and take.

He pointed to the difference in taxation on cars imports from Europe as opposed to cars being exported.

Cravinho said: "We understand India's growth imperative and are keen to have a very positive interaction. And so the agreement will be asymmetrical. At the moment, tariff (on cars imported from Europe) is up to a 100 percent, whereas the duty on car shipped to Europe is only 7-8 percent."

He added: "We are not saying they have to be equal on both sides but they should be proportionate...

Taxation has to come down quite significantly."

India ships 2,00,000 cars to Europe each year while Europe exports about 40,000 cars to India, he said.

Cravinho said he is optimistic about growth in India, which is currently at a level well below its potential as an investment destination than many of its competitors.

"In my conversation with EU business leaders, and we share the optimism (on India), there is also very much a recognition that the environment for investment has not yet changed significantly.

There has been some change but it is more of a psychological than substantive nature," he said.

The government needs to improve the investment climate further, leading to increased inflows that will help build the country's manufacturing capacity, he added.

Talking about the 'Make in India' initiative, Cravinho said it reflects the government's ambition and will also help the country enter the global value chain.

He also said the last year's ban by EU on India's Alphonso mangoes is

likely to be lifted soon.

Luxury product companies' stampede in e-comm sites

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iche players with designer products and premium offerings are checking into the crowded e-commerce fashion space to cater to a select clientele looking for a deal on their favourite labels. The growing customer base for luxury products coupled with the awareness of international labels and discounts are driving the business of premium products online.

The touch and feel of a product -the mainstay of luxury products -have been influenced by discount and easy availability of international brands and designer labels to a larger audience online. Customisation and after-sales services offered by some of the online players bring them on par with shopping at a high-end boutique.

"We will roll out our brick-andmortar stores by mid-2015 where customers can try on pieces, meet designers and request customised fit on a product, though orders will have to be placed online. We have our own manufacturing facility in Delhi and Mumbai for vertical integration," says Avnish Chhabria, co-founder and CEO of Stylista, which retails limited edition designer pieces by names such as Wendell Rodricks, Masaba Gupta as well as in-house high street fashion as part of Stylista Select range. The e-tailer raised Rs 5.5 crore from Rishi Khiani's in` novation fund Ant Farm earlier last year and has clocked in Rs 3.4 crore as revenue over the past six months.

The luxury market in India has been insulated from the market slowdown and has shown significant growth over the past few years. A report

by IMRB International pegged the current marketsize for luxury in India at $10 million-plus with the luxury products segment growing at a CAGR of 21.8% in the past three years.

"There are two reasons why these e-commerce players will be India Newsletter • 9

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successful in India. The first is that the Indian luxury consumers come from the tier-2 and 3 cities.Also, the e-commerce facilities will bring better prices to the consumers; this will be seen as one of the advantages of shopping online," says Sushmita Balasubramaniam, vice-president at IMRB International Retail. Though the reach provided by a large marketplace is incomparable, the deep discounting has led online luxury players to drive the discerning customer to their flagship sites by rewarding customer loyalty.

"Tying up with a marketplace model will not work for us though we were approached by a few play ers -you can't buy a Prada bag there. We retail the products at heavily discounted prices as we tie up with international boutiques that are authorised dealers of the luxury labels and hold inventory which they would like to sell," says Nakul Bajaj, 23-yearold founder and CEO at Darveys.com, which retails around 60 high-end accessory brands on its portal.

The portal charges Rs 1,000 per user to register following which they can see the prices for the curated collection. The price disruption invited legal notices from brands such as Christian Louboutin, Jimmy Choo and Burberry which have a footprint in India.

Stylista experimented with marketplace model at Jabong between March and June in 2014, currently it is exclusive to Myntra and Flipkart. "It is our discretion what products we choose to put up on the marketplace," says Chhabria.

After a brief association with Myntra's marketplace, the platform recently signed up a number of offline boutiques which can showcase designs and has a target of adding 100 retailers by end of 2014 to become a marketplace for premium labels.

"We would like to become the equivalent of an online mall for luxury products," says Sunjay Guleria, co-founder and executive director of Exclusively.in which was among the first online platforms 10 • India Newsletter

serving the Indian diaspora in 2010.

Though the market largely consists of Indian diaspora in case of ethnic collections or international buyers, the buyer base for luxe is showing a steady growth. "Presently, up to 70% of our sales are driven by buyers outside India though we expect the numbers to come down to 50%

by January next year," says Guleria.

Exclusively.in ships its products to nearly 150 countries. Stylista counts Brazil, UK, Australia and Canada among its major markets abroad.

Value-for-money is definitely at the top of Indian luxury shopper's wishlist.

"Indians traditionally are value shoppers. Even if these platforms focus on differentiation and design, price advantages will be critical for the model to succeed. In this model, the shopper loses out somewhat on the shopping experience, `touch & feel' that is a critical part of apparel or accessory shopping.

A discernible price advantage will help in compensating for that loss, to a large extent," says Sushmita Balasubramaniam.n

Global investors buy $2 billion office space in 2014

F

oreign investors have bought tenanted office space worth over $2 billion in India in the last calendar, a four-fold rise compared to the previous year in their appetite for rent-yielding commercial assets in Asia's third largest economy.

Data sourced by TOI suggests that $2.23 billion or over Rs 14,000 crore worth of built and tenanted office space has been bought by foreign and, to a small extent, Indian investors across the country's key metros of NCR, Mumbai, Bengaluru, Pune, Kolkata, Chennai and Kochi.

The comparative number during 2013 stood at $570 million, signalling how the office property market has come of age in the current calendar.

With a burgeoning middleclass, India's residential property market has always been the go-to investment destination for bulgebracket global fund houses and

small-fry Indian retail investors. But that's changing at least for the big global investors who have taken a liking to India's commercial assets, which is riding on the services economy with stable yields.

Two of the world's largest and prolific real estate investors — New York-based Blackstone Group and Canadian firm Brookfield Asset Management — alone have bought into buildings with an asset value of almost $2 billion or Rs 12,000 crore.

While Brookfield picked up six IT SEZ assets from NCR-based property developer Unitech valued at $850 million, its rival Blackstone bought into office assets worth $870 million.

The figures mentioned are the asset value of the acquired properties and not the size of equity cheques cut by them.

"This would be a record year for the commercial property market. It also shows that foreign capital was less risk averse and preferred to invest in stable rent-yielding office assets," said Anshuman Magazine, CMD of property consultancy firm CBRE South Asia. Investor sentiment has also been bolstered by Indian market regulator Sebi issuing guidelines for the listing of real estate investment trusts (REITs) and the Union government's decision to ease FDI restrictions in real estate.

Blackstone-backed Embassy Office Parks, RMZ Offices, in which Qatar Investment Authority is an investor, and K Raheja Corp have all been working on various listing or value unlocking moves, but are waiting for more clarity on the tax implications of an Indian REIT before beginning a formal process.

Blackstone's asset buys in 2014 include the iconic Express Towers in Mumbai ($150 million), the 106-acre Vrindavan Tech Village in Bengaluru along with its southern JV partner Embassy group ($300 million), and Oxygen IT SEZ in Noida ($100 million), among others. Xander, another global fund house, bought the TRIL IT Park in Mumbai from the Tatas, valued at $100 million.

There's more action building up in

www.indianembassy.at

the new year as private investors, pension funds, Wall Street banks and sovereign wealth managers are deploying more capital to chase Indian commercial real estate.

Canadian Pension Plan Investment Board (CPPIB) along with Shapoorji Pallonji and Dutch pension fund APG and GIC of Singapore are among the investors who have committed fresh capital.

The Indian economy seems to be the only one among all major emerging economies that is poised for improved growth in the next financial year, said Anuj Puri, chairman and country head of JLL India, adding that "we are definitely going to see some interesting office space action in 2015". The current weakness in the Indian rupee too provides foreign investors with the opportunity to invest deeply in Indian commercial real estate assets, Puri said.

India's office property market is still minuscule even when compared to the neighbouring South East Asian region, pegged at $125 billion.

Reason: Almost 80% of the 400 million sqft A-grade office space in the country is held through strata titles, a form of ownership where each floor of a building is owned by multiple investors.n

India draw Food Map to steer its Food Processing Industry Exports

T

he map developed in association with Yes Bank is likely to help kickstart several government initiatives to boost food processing industry in India and processed food exports.

India’s Ministry of Food Processing Industries has released the much awaited Food Map of India, a database which will be used to develop a Food Grid and to implement a slew of measures the government is planning to transform the growing food processing sector in India.

India is already a leader in several food exports, including agricultural

products, seafood, spices, and meat.

However, experts say that there is immense growth potential for processed food exports by India considering that value-addition in Food Processing in India stands at a mere 2%.

Moreover, lack of processing and marketing means that most of the exports is done without much valueaddition and is vulnerable to wastage and severe price fluctuations. As per estimates, up to 18% of fruits and vegetables produced in India is wasted due to lack of processing and adequate storage facilities.

The government has several plans to transform this sector with the help of manufacturing clusters and food parks. The government has, under its infrastructure development plans, approved five Mega Food Parks during June – December 2014 and has approved sanctioning of 42 projects. Ten cold chain projects has also been completed in the same period, and three abattoirs in Hyderabad, Vishakhapatnam and Edyar are likely to begin operations in 2015.

The government has also established a special fund valued at around Rs.2,000 crore set up in National Bank for Agriculture and Rural Development (NABARD) to provide affordable credit to the food processing units to be set up in the designated Food Parks. However, most of the plans were waiting for the development of the Food Map for implementation.

All these measures are expected to begin soon with the release of the Food Map. “Idea is to identify the surplus and deficient areas in the country of various agricultural and horticultural produce so as to plan processing clusters by means of setting up processing facilities under current schemes,” said the Ministry of Food processing Industries, Government of India.

The “Fruits & Vegetables Availability Maps of India” has been developed

by Food and Agribusiness Strategic Advisory & Research (FASAR) and YES BANK. Rana Kapoor, MD & CEO,

Yes Bank, said that Food Processing is a $180 billion industry in India, and growing annually at close to 9%. It also accounts for around 13% of the national exports and employs 60% of India’s working population directly or indirectly.

Kapoor said, “It has all the ingredients to catapult India into a virtuous cycle of sustainable development, inclusive growth and lower food inflation. However, with only 3% of the overall gross bank credit, 2.6% of overall FDI inflows and a mere $28 billion of fixed capital deployment, the true potential of this highly significant sector still remains untapped.”n

India plans five $5 billion green energy funds As part of its blueprint for energy security, the National Democratic Alliance (NDA) government plans to float five funds of $5 billion each, targeted at promoting green energy sources.

India’s ministry of new and renewable energy (MNRE) plans to get the help of state-owned and private sector financial institutions such as Power Finance Corp. Ltd (PFC), Rural Electrification Corp.

Ltd(REC), Indian Renewable Energy Development Agency (IREDA), IFCI Ltd, SBI Capital Markets Ltd and ICICI Bank Ltd to create a corpus of $25 billion.

The Bharatiya Janata Party (BJP)led government has substantially revised an earlier solar energy target of achieving 20,000 megawatts (MW) capacity by 2022 to 100,000MW. In addition the government plans to have 60,000MW of wind power capacity by then, requiring an overall investment of around Rs.10 trillion in the renewable energy sector.

“We are seeking participation from both public sector and private institutions for setting up these dedicated green funds, given the funding requirements for India’s renewable energy sector,” said a top government official, who spoke on condition of anonymity as the plan India Newsletter • 11

Embassy of India, Vienna

is in its initial phases.

The government’s renewed focus on green energy comes in the backdrop of the US and China inking a climate change deal wherein the US will reduce its emissions by 2628% below its 2005 level by 2025 and China will reach the peak of its harmful carbon dioxide emissions in around 2030.

Another government official who also didn’t want to be identified confirmed that the government is thinking along the lines of creating large green-energy focused funds.

“The funding requirements of the renewable energy sector is large and various opportunities are being explored. Meetings are being held for the same and bankers are being consulted.

The BJP made energy security a key part of its general election campaign.

The government’s strategy to focus on renewables also stems from the fact that India has an energy import bill of around $150 billion, which is expected to reach $300 billion by 2030. India imports 80% of its crude oil and 18% of its natural gas requirements.

A senior REC executive who did not want to be identified said the plan is at a “preliminary stage”.

An IFCI spokesperson said in an emailed response that the company had “no information on government’s plan to create these funds”.

Queries emailed to the spokespersons of MNRE, PFC, IREDA, SBI Capital Markets and ICICI Bank remained unanswered till press time.

In a related development, Union minister for power, coal, new and renewable energy Piyush Goyal said that the government will play the role of a facilitator for the renewable energy sector.

“Lending is a credit decision without any political interference. We can only give the assurance that plants set up in the renewable energy space will be sustainable,” Goyal said at a press conference in New Delhi.

In an effort to promote renewable 12 • India Newsletter

energy, last year’s budget doubled the clean energy cess on Indian and imported coal collected under National Clean Energy Fund (NCEF) to Rs.100 per tonne, aggregating Rs.6,000 crore every year.

In the budget, finance minister Arun Jaitley also expanded the scope of NCEF’s use to include financing and promoting clean environment initiatives and funding research towards that end.

In a further attempt to meet the funding requirements, India has accessed credit lines through IREDA for financing renewable energy projects.

These include 30 billion yen for 30 years from Japan International Co-operation Agency; a $1 billion medium and long-term guaranteed loan from US Ex-Im Bank and €100 million from the Agence Francaise de Développement of France.

India’s National Action Plan on Climate Change recommends that the country generate 10% of its power from solar, wind, hydropower and other renewable sources by 2015, and 15% by 2020. Of India’s installed power generation capacity of 2,55,012.79MW, renewable power has a share of only 12.42%, or 31,692.14MW. Mint reported on 19 November that the government plans to train around 50,000 people in areas related to solar power—a so-called solar army.

In addition, the government is also working on a strategy to turn some 20,000 unemployed graduates into entrepreneurs to help it meet its ambitious solar power generation targets—a plan it will implement in concert with state administrations.

The government’s initiatives in renewable energy include plans for setting up of solar parks totalling 20,000MW over a period of five years in states, that will require central government support of Rs.4,050 crore. Also, organizations under the ministries of defence and home would set up 300MW of grid-connected solar photo-voltaice projects with viability gap funding provided under the Jawaharlal

Nehru National Solar Mission. In addition, 1000MW capacity will be set up by state-owned companies and government organizations such as NTPC Ltd, NHPC Ltd, Coal India Ltd and the Indian Railways.n

Apple plans big India push with 500 stores

A

pple, the Cupertino-based world's most valuable electronics maker, has decided to go big in India.

After being on the fringes for long, the company is finally set to cut loose in the fast-growing Indian phone market. The world's most admired electronics brand - that sells devices such as the iPhone, iPad tablet and iPod media player - plans 500 'iOS' stores in the country in its first major push that will include moving into smaller towns and cities.

The company, which recently topped $700 billion in market cap in the US, has been in India since 2011, but not been a mainline brand here like many other overseas markets, including China. This is in contrast to its Korean rival Samsung that dominates the Indian phone market.

"All this will change now. The company is finalizing plans to become a serious player in India, which is being seen as a strategic and one of the most promising markets globally," a top company source told TOI. The company sold around one million phones in India in the year ending September 2014 and expects the volume to treble last year and top 3 million. "And, it will only strengthen from here as the expansion starts and picks pace," another source said.

Apple currently operates in India through two key distributors Redington and Ingram, who in turn supply the products to regional distributors, multi-product trade channels and Apple Premium Reseller stores and Apple Authorized Re-seller outlets. Redington is one of the biggest partners for Apple in India and accounts for nearly 70% of its sales. Puneet Narang, who heads

www.indianembassy.at

Redington's marketing of iComm Strategic Business Unit, however, did not comment on Apple's plans.

Sources said the company feels that there is "very high" potential for its products, including in smaller towns and cities like Amritsar, Pathankot, Moga, Coimbatore, Trichy, Nagpur and Nasik. Currently, the company is big in cities like Delhi, Mumbai, Bangalore, Kolkata and Chennai.

"We are amazed at the purchasing power in smaller towns. The primary objective is to give a better and proper experience with adequate product demonstration," another source added.

The sources said Apple has "tentatively approved" the expansion proposal and will give a final go-ahead very soon, defining all the parameters and phases of expansion. "These new stores will be smaller in size and could range from 300-600 sq ft against over 2,000 sq ft size of existing stores in bigger cities." A franchise model is likely to be adopted and could be spearheaded by Redington. Apple is also expected to increase spending for direct advertising in India, apart from publicity undertaken by its distributors.n

Google ready to help India implement PM Modi’s “Digital India” initiative

G

oogle is ready to help India implement Prime Minister Narendra Modi's "Digital India" initiative, and the government has a well laid out plan to realise it, said Google's Chief Internet Evangelist Vinton G. Cerf.

Cerf was speaking at a seminar organised by Federation of Indian Chambers of Commerce and Industry ( FICCI). "It is very clear that the private sector is going to have to play a major role, but it won't work unless basic infrastructure that government proposes to bring in is put into place," he said, adding that Google was in "early stage of discussion" to discuss ways to increase Internet penetration in the country.

Digital India is a Rs 1.13-lakh crore government initiative that seeks to transform the country into a connected economy, attract investment in electronics manufacturing, and create millions of jobs and support trade.

Cerf, a computer scientist widely known as one of the fathers of the Internet, said the new Indian government and its initiatives such as Digital India were "very refreshing and exciting".

He appreciated the government's plans to improve Internet infrastructure, especially its plans to expand Internet penetration in the villages.

"My impression after two days discussions is you (the government) already have a well laid out plan.

Now you have to execute. The passion is clearly there, the energy is clearly there," he said.

Communications and Information Technology Minister Ravi Shankar Prasad tweeted a picture of his meeting with Cerf earlier in the day.

The senior Google executive also met some officers of the Department of Electronics and IT, and said they were convinced about making Digital India a reality.

Cerf also stressed the need for IT professionals to constantly upgrade their skills in order to remain relevant in the fast changing world of technology.n

in a phased manner depending upon the availability of resources, project handling capacity of NCSM and the existing level of science centre activities in that particular State.

The following proposals have also been received by NCSM for establishment of Science Cities:Science City, Sampla, Govt. of Haryana Science City, Bengaluru, Govt. of Karnataka Science City, Navi Mumbai, Govt. of Maharashtra Science City, Hyderabad, Govt. of Andhra Pradesh (before bifurcation into Telangana and Andhra Pradesh).

Science City, Patna, Govt. of Bihar Science City, Nagpur, Govt. of Maharashtra Science City, Bhubaneswar, Govt. of Odishab Science City, Kumhari, Govt. of Chhattisgarh Science Park is now an integral component of all Science Centres and Science Cities and hence is not set up as an independent facility.

NCSM has not received any proposal from Govt. of Telangana for setting up of Science Centre/City after its creation.

This information was given by the Union Minister of State for Culture (Independent Charge) in a written reply to a question in the Lok Sabha.n

Establishment of Science Cities

First experimental flight of India's next generation National Council of Science launch vehicle GSLV MK-III Museums (NCSM), an autonomous organization under the Union successful Ministry of Culture is engaged in establishment of Science Centres throughout the country. NCSM is developing a Science City at Guwahati, Assam which will subsequently be handed over to the Govt. of Assam for future operation and maintenance. Proposals from various state governments have also been received for setting up of Science Cities. The Science Centres/ Cities projects are taken up by NCSM

The first experimental flight (GSLV Mk-III X/CARE) of India’s next generation launch vehicle GSLV MkIII was successfully conducted on December 18, 2014, morning from Satish Dhawan Space Centre SHAR, Sriharikota. Also known as LVM3-X/ CARE, this suborbital experimental mission was intended to test the vehicle performance during the critical atmospheric phase of its flight and thus carried a passive India Newsletter • 13

Embassy of India, Vienna

(non-functional) cryogenic upper stage.

The mission began with the launch of GSLV Mk-III at 9:30 am IST from the Second Launch Pad as scheduled and about five and a half minutes later, carried its payload – the 3775 kg Crew Module Atmospheric Re-entry Experiment (CARE) – to the intended height of 126 km. Following this, CARE separated from the upper stage of GSLV Mk-III and re-entered the atmosphere and safely landed over Bay of Bengal with the help of its parachutes about 20 minutes 43 seconds after lift-off.

Two massive S-200 solid strap-on boosters, each carrying 207 tons of solid propellants, ignited at vehicle lift-off and after functioning normally, separated 153.5 seconds later. L110 liquid stage ignited 120 seconds after lift-off, while S200s were still functioning, and carried forward for the next 204.6 seconds.

CARE separated from the passive C25 cryogenic upper stage of GSLV Mk-III 330.8 seconds after lift-off and began its guided descent for atmospheric re-entry.

After the successful re-entry phase, CARE module’s parachutes opened,

following which it gently landed over Andaman Sea about 1600 km from Sriharikota, there by successfully concluding the GSLV Mk-III X/CARE mission.

With the successful GSLV Mk-III X / CARE mission, the vehicle has moved a step closer to its first developmental

flight

with

functional C25 cryogenic upper stage.n

INDIA PERSPECTIVES MAGAZINE ONLINE

www.magzter.com/publishers/meaindia

14 • India Newsletter

the

www.indianembassy.at

MAKE IN INDIA Summary ■■ 9th largest civil aviation market.

■■ 163 Million passengers in 2013.

■■ 60 Million passengers by 2017.

international

■■ 85 international airlines connecting over 40 countries.

■■ 3rd largest aviation market by 2020.

■■ 800 aircraft by 2020.

Reasons to Invest ■■ India is one the fastest growing aviation markets and currently the ninth largest civil aviation market in the world.

■■ India is projected to be the 3rd largest aviation market by 2020.

■■ Total passenger traffic stood at 163.06 Million during 2013. India is one of the least penetrated air markets in the world with 0.04 trips per capita per annum as compared to 0.3 in China and more than 2 in the USA. ■■ Indian carriers plan to increase their fleet size to reach 800 aircrafts by 2020.

■■ The Indian aviation sector is likely to see investments totalling USD 12.1 Billion during 2012-17; USD 9.3 Billion is expected to come from the private sector.

Statistics ■■ Domestic Passenger traffic CAGR – 7.71% (FY 2006-13); 209 Million by FY 2017.

■■ International Passenger traffic CAGR – 8.96% (FY 2006-13); 60 Million by FY 2017.

■■ Total freight traffic CAGR – 5.2% (FY 2006-13); 2.19 Million Tonnes in FY 2013.

■■ More than 85 international airlines operate in India and 5 Indian carriers connect over 40 countries.

Growth Drivers ■■ Five international airports (Delhi, Mumbai, Cochin, Hyderabad, Bengaluru) have been completed successfully under PPP mode.

■■ Greenfield airport at Navi Mumbai, Mopa (Goa) and some brownfield airports of Airports Authority of India (AAI) and 50 airports under the low cost model are to be developed all over the country, including under PPP. ■■ Indian aviation is experiencing dramatic growth across the board, from the emergence of LCC/new carriers to a growing middle class ready to travel by air as well as growth in business and leisure travel.

■■ India’s middle income population is expected to increase from 160 Million in 2011 to 267 Million by 2016.

■■ Greater focus on infrastructure development; increasing liberalisation – Open Sky Policy; AAI driving modernisation of airports, Air and Navigation Systems.

■■ Growth in aviation accentuating demand for MRO (maintenance, repair and overhaul) facilities.

■■ Large scale collaborations/M&A

deals – Etihad Airways & Jet Airways; Tata Group & Singapore Airlines, Tata Group & AirAsia.

■■ India plans to increase the number of operational airports to 250 by the year 2030.

FDI Policy ■■ 100% FDI is permitted for greenfield airport projects under the automatic route.

■■ Up to 74% FDI is permitted for existing airport projects under the automatic route, above 74% and up to 100% permitted under government approval route.

■■ Up to 49% FDI is permitted in domestic scheduled passenger airlines under the automatic route.

100% permitted for NRIs. Up to 49% FDI under the automatic route is permitted in Non-Scheduled Air Transport Service. FDI above 49% and up to 74% is permitted under Government approval route. 100% FDI permitted for NRIs. ■■ Up to 100% FDI is permitted in helicopter services and seaplanes under the automatic route.

■■ Up to 49% FDI is permitted in ground handling services under India Newsletter • 15

Embassy of India, Vienna

the automatic route. FDI above 49%

operations.

to develop Guwahati as an inter-

and up to 74% is permitted u nder

■■ The budget envisages the development of new airports in Tier I and Tier II cities.

regional hub and Agartala, Imphal

■■ The Income Tax Act provides presumptive taxation under Section 44AE in respect of assesses who are engaged in the business of plying, hiring or leasing goods carriages. The bill proposes to increase the amount of presumptive income to INR 7,500 per vehicle for all types of goods carriage vehicles.

■■ The Airports Authority of India

■■ Exemptions under the Income Tax Act for infrastructure development under section 80 IA.

parking, security equipment and

■■ Basic customs duty exemption is available for parts and testing equipment used for the maintenance, repair and overhaul of aircraft.

■■ Airbus (France)

government approval route. 100% FDI permitted for NRIs. ■■ Up to 100% FDI is permitted in

maintenance

organizations;

and

flying

repair training

institutes; and techinical training institutes under the automatic route.

■■ Investments relevant

are

subject

regulations,

to

approvals

from DGCA and security and other conditions. Foreign airlines are also, henceforth, allowed to invest in the capital of Indian companies, operating

scheduled

and

non-

scheduled Air Transport Services, up to the limit of 49% of their paid-up capital. Investments will be subject to government route.

Sector Policy ■■ The Airports Authority of India is

responsible

for

developing,

financing,

operating,

maintaining

all

public

and sector

airports. New airports are permitted under

the

Greenfield

Airport

Policy 2008. Investment in airports is encouraged under the Public Private Partnership Policy of the Government of India.

■■ Regional Air Connectivity Policy offers attractive incentives in the form of exemption of landing, parking and navigation fees to airlines operating at designated airports in non-metro areas.

Financial Support ■■ KEY PROVISIONS OF THE 2O142O15 UNION BUDGET: ■■ Aircraft engines and parts thereof are eligible for duty exemption when imported for servicing, repair or maintenance of aircraft used f or scheduled 16 • India Newsletter

■■ Budgetary support is provided to the AAI for the development

of airport infrastructure in the northeastern states of India.

Investment Opportunities ■■ 300 business jets, 300 small aircraft and 250 helicopters are expected to be added to the current fleet in the next 5 years.

■■ Growth in aviation is accentuating demand for MRO facilities.

■■ Greenfield airports under Public Private Partnership at Navi Mumbai and Mopa (Goa).

■■ The development of new airports – the Airports Authority of India aims to bring around 250 airports under operation across the country by 2020.

■■ The North-east region – the Airports Authority of India plans

and Dibrugarh as intra-regional hubs. plans to spend USD 1.3 Billion on non-metro projects between

2013 and 2017, focusing on the modernisation and upgradation of airports.

■■ Indian airports are emulating the SEZ Aerotropolis model to enhance revenues, focus on revenues from retail,

advertising

and

vehicle

services.

Foreign Investors ■■ Boeing International Corporation (USA) ■■ AirAsia (Malaysia) ■■ Rolls Royce (UK) ■■ Frankfurt

Airport

Services

Worldwide (Germany) ■■ Honeywell Aerospace (USA) ■■ Malaysia

Airports

Holdings

Berhad (Malaysia) ■■ GE Aviation (USA) ■■ Airports Company South Africa Global (South Africa) ■■ Alcoa

Fastening

Systems

Aerospace (USA)

Agencies for Contact ■■ Ministry of Civil Aviation ■■ Directorate

General

of

Civil

Aviation ■■ Bureau of Civil Aviation Security ■■ Airports Economic Regulatory Authority of India ■■ Air India Limited ■■ Pawan Hans Limited ■■ Airports Authority of India

www.indianembassy.at

PERSPECTIVES ON INDIA 2015 - Year of the Indian entrepreneur

by Aparna Dutt Sharma CEO, IBEF ith India becoming the fourth largest base for young businesses in the world, the year gone by has provided many reasons to cheer for first generation home grown entrepreneurs. With the rise in the number of angel funds and incubators, increased private equity (PE) and venture capital (VC) funding backed by a conducive ecosystem, Indian start ups reached record high valuations and crossed new milestones in 2014. Be it the Flipkart valuation of US$ 11 billion, investment by Mr Ratan Tata in ecommerce ventures like Snapdeal and UrbanLadder.com or the US$ 10 billion investment commitment made by Japan’s SoftBank towards the Indian market, the Indian entrepreneurial circuit witnessed a lot of action during the past year.

Private equity (PE) investments in India touched a four year high in 2014, with PE funds investing US$ 10.9 billion across 436 deals, as compared to US$ 7.4 billion invested in 2013 across 433 deals. Similarly, overall investments by venture capital (VC) funds increased sharply in 2014, both in terms of value and volume, touching US$ 2.1 billion across 1,108 deals, an increase of 47.7 per cent compared to 2013 when VC funds invested US$ 1.4 billion across 246 deals.

W

Industry experts believe that Indian entrepreneurs are likely to sustain the growth momentum with new ventures emerging in traditional and modern businesses like Internet of Things, augmented reality, smart hardware

and BI (business intelligence). The outlook for private equity funds is also positive for 2015 with sectors like IT, logistics, warehousing, healthcare and ecommerce expected to receive significant PE attention. Venture capital funds focused on the social sector alone are planning to raise close to Rs 5,000 crore (US$ 788.4 million) in 2015. With the government also backing the entrepreneurial revolution by facilitating an encouraging environment for Indian entrepreneurs through policy initiatives that include the setting up of a separate Ministry for Entrepreneurship and Skill Development, 2015 is expected to be a positive year for Indian entrepreneurs with first generation ventures touching new highs and strengthening their foothold in the domestic market and beyond.

In the long run, the entrepreneurial revolution in India is only expected to gather further momentum with the number of tech start-ups in the country projected to touch 11,500 by 2020. India is currently home to over 3,000 tech start-ups. IBEF spotted the entrepreneurial revolution in India early and has already launched a dedicated video series and publication titled Ordinary Indians, Extraordinary Enterprise, capturing the journeys of 25 new age Indian entrepreneurs.

India: The knowledge hub

by Aparna Dutt Sharma CEO, IBEF oday India is widely recognised as a knowledge hub powering the global economy. The young Indian talent base working across the world is an integral advantage compared to many economies. Factors like a vibrant ecosystem, entrepreneurial mindset, strong R&D capabilities

T

and social innovations are playing a critical role in reinforcing India’s position as the knowledge hub.

With the second largest pool of scientists and engineers working across the world, 400+ universities, 1.2 million engineering graduates and 300+ national laboratories, India has the education system that nurtures talent to power the knowledge revolution. The global leadership attained in the field of IT is a testimony of talent excellence.

The Indian IT sector alone has contributed in a saving of over US$ 200 billion for global clients over the last five years and more than 70 per cent global clients have benefitted from solutions designed in India.

India has been ranked first in the recently released A.T. Kearney Global Services Location Index. “India remains the preeminent destination for offshore services, with excellence in IT, BPO, and voice services. The undisputed leader in the field for the past decade, India is still unrivalled in both scale and skills, and it is increasing its advantage over second-place China,” says the survey.

The entrepreneurial mindset of the Indian population makes the country the fastest growing and third largest start-up ecosystem in the world. The advent of e-commerce and modern technologies has led to over 4000 active technology startups, 400 VCs, 2,500 angel investors and 150 startup incubators. It is estimated that India will have around 114 million one person enterprises by 2020. Technology products and digital startups are expected to quadruple to 11,500 by 2020 from the present 3,100.

India Newsletter • 17

Embassy of India, Vienna

India has been widely recognised

year, which is five times the total

It must be noted that the country

as the global R&D hub. Home to

capacity addition in the previous

has enormous potential in both

over 1,000 MNC R&D centres, India

fiscal. Besides, it is also working

wind and solar energy. By the end

is the third preferred centre for

to ramp up the overall target for

of October, 2014, India’s renewable

innovation after Silicon Valley and

solar power generation to 100,000

energy capacity had reached 33 GW.

other US cities. Multinationals like

MW by 2022 from the earlier target

Around 70 per cent of this capacity is

Cisco, BMW, GE, Honda, Panasonic,

of 20,000 MW. Tax incentives that

accounted for by wind energy (22.1

Microsoft, Honeywell, IBM et al are

include accelerated depreciation

GW). This is followed by biomass (4.2

already engaged in their Indian R&D

and generation based initiatives

GW), small hydro power (3.9 GW)

operations and over half of Fortune

have been reinstated this year.

and solar power (2.8 GW). India has

500 companies are expected to

Efforts are on to ensure viability of

the potential to add 145 GW of solar

open R&D centres in India by 2015.

solar energy projects by enabling

power capacity by 2024. The average

Achievements in the area of space

grid parity and also providing

sciences, telemedicine and tele-

assurance

education are playing an important

returns. According to government

role in the overall development of

projections, India is expected to

the nation. As recently explained by

receive investments of around US$

Mr Narendra Modi, Prime Minister

100 billion in the renewable energy

of India, “India’s space programme

space in the coming four years.

is driven by a vision of service to

Buoyed by the strong impetus

humanity, not by a desire of power.”

Achievements like the successful launch of the Mars Orbiter Mission (Mangalyaan) and the more recent GSLV Mk-III X, India’s biggest ever rocket, speak volumes of the scientific prowess of the country.

of

bankability

and

being provided to the clean energy sector by the Government of India, industry is showing firm intent

intensity of solar radiation received

by India is 200 MW per sq km and the country gets around 70 per cent more solar radiation than European nations. With conventional fuels like coal getting expensive, solar has a bright future in India. The levelised cost of energy (LCOE) from solar is currently at par with the cost of energy from imported coal. While the latter is projected to grow at a CAGR of 12 per cent over the next

towards long term investments in

10 years, LCOE for solar energy is

this space. Companies are exploring

expected to correspondingly drop

all possible sources for funds - be it

at a CAGR of 4 per cent and even

initial public offerings (IPOs), debt

Equally innovations in India continue

match LCOE of power plants based

instruments or foreign investment.

to offer models for inclusive growth

on domestic coal by 2019.

According to inputs by experts in

whilst at the same time addressing

India is the fifth largest producer of

the sector, wind energy companies

complex global challenges. The

wind energy in the world and still

are looking to raise funds between

has a huge potential to leverage.

Rs 5,000-6,000 crore while Indian

Estimates by the Indian Wind Energy

Renewable Energy Development

Association project the potential

Agency (IREDA), the government

of wind energy for electricity

owned financing entity for the

Powering the clean energy

generation at around 102 GW. In this

renewable energy sector, is planning

milieu, the aggressive intent being

enterprise

to raise around Rs 3,000 crore via an

shown by the government and the

IPO. As wind energy projects reach

industry in the clean energy sector is

gigawatt scale, PE exits are also

expected to greatly improve India’s

T

likely, which are expected to lead to

energy mix and reduce dependence

5-6 big ticket IPOs in the sector in

on conventional fuels in the coming

10,000 MW of wind energy every

the next five years.

years.

strategic

matrix

of

a

vibrant

ecosystem, R&D and innovations powered by talent positions India as the global knowledge hub.

by Aparna Dutt Sharma CEO, IBEF he Government of India has set an ambitious target of adding

18 • India Newsletter

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EXPERT BUSINESS ADVICE The article below was extracted from Dezan Shira & Associates’s publication entitled “India Briefing”. For further corporate assistance, consider contacting Dezan Shira & Associates, a specialist in foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in emerging Asia. For further details or to contact the firm, please email Mrs. Gujan Sinha under gunjan.sinha@dezshira.com or visit www.dezshira.com

Exporting from India: Procedures and Duties Having recognized how important the export industry is to foreign investment and economic growth, the Indian government has in recent years done a great deal to deregulate the necessary procedures and make the export process far easier for companies to manage. As a result, export duties are less expensive now than they were in the past and are, in many instances, entirely avoidable for exporters. Looking to the future, Narendra Modi has made clear his intention to further streamline the various services in India and revamp laws that may obstruct foreign businesses.

That being said, a number of procedures and export duties still exist that foreign companies should become familiar with. Duties still apply to certain kinds of goods and, in some cases, items cannot be exported at all. Below, we look at some of India’s most important export procedures and policies.

■■ Preliminary Procedures for Exporting from India There are a number of preliminary steps that must be taken before beginning a sourcing operation in India. These variously include registering with official bodies, applying for the relevant licenses, and obtaining the documents that are necessary to export items.

Directorate General of Foreign Trade The Directorate General of Foreign Trade (DGFT) operates as an arm of the Ministry of Commerce and Industry’s Department of Commerce and is the agency responsible for virtually all matters related to India’s export/import policies. All first-time exporters or importers must register with the DGFT and acquire an Importer Exporter (IE) code number.

This 10 digit code is necessary for businesses wishing to either export from or import to India.

To apply for an IE code number, the “Aayaat Niryaat Form” (ANF2A) must be submitted to the nearest regional authority of the DGFT either online, via post or in person. Along with the form, the following items must also be submitted: ■■ Two passport-sized photographs of the legally responsible person; ■■ Permanent (PAN);

account

number

■■ Current bank account number; and ■■ Banker’s Certificate.

The PAN is another 10 digit code that is necessary for many financial transactions in India and can be obtained by submitting an application along with proof of residence and identity. The other two documents are obtained simply by opening a bank account.

Export Promotion Council Although not essential, registering with the Export Promotion Council (EPC) – a non-profit organization with branches all over India – offers numerous advantages for exporters.

The services that it provides to its members include, but are not limited, to: ■■ Giving commercial information and assistance to develop and increase exports; ■■ Offering professional advice in areas such as technology, product development and innovation; ■■ Organizing delegation visits to overseas areas to explore market opportunities; ■■ Organizing attendance of trade fairs, exhibitions and buyer-seller meets in both India and abroad; ■■ Providing statistical data on India’s exports and imports.

There are presently 14 different councils of the EPC, each responsible for their own respective industry, such as engineering, sports, and basic chemicals. The contact details of each can be found on the Ministry of Commerce and Industry’s website.

Membership can be applied for by contacting the relevant Council.

Other Preliminary Actions As well as registering with the DGFT and obtaining an IE Code, other preoperational steps include: ■■ Obtaining a PAN based Business Identification Number (BIN) from India Newsletter • 19

Embassy of India, Vienna

the DGFT. This must be acquired before filling out a shipping bill or a bill of export for exported goods; ■■ If exporting by air or sea, a shipping bill must be filled out, or if exporting by road, a bill of export must be completed. These bills contain various information relevant to exporting from India, including the name of the exporter, invoice number, consignee,description and quantity of goods, free on board (FOB) value, etc; ■■ At the same time as submitting a shipping bill/bill of export, other relevant documents must also be provided, including invoices, export contracts, and packing lists; ■■ A certificate of origin must also be submitted. This is used to verify where goods have been produced.

■■ Licenses and Export Duties Obtaining the Appropriate License Under current regulations, most goods can be organized or managed for export without obtaining a license.

It is only if items are listed in Schedule 2 of the Indian Trade Classification (ITC) Harmonized System (HS) that a company will either need to obtain the relevant license, or be unable to export the product at all. If a license is needed, an application must be submitted to the DGFT, which grants export licenses on a case-by-case basis based on the merits of the exporter in question.

Products listed in Schedule 2 of the ITC (HS) will either be restricted or prohibited. Restricted goods become available for export once a company has obtained the appropriate license.

Licenses are granted by the DGFT, and the conditions for their attainment vary according to what is being exported. Prohibited goods are ones that cannot be exported at all.

See on the right the list the most commonly restricted or prohibited export items: 20 • India Newsletter

State Trading Enterprise (STE) There is an additional means to export Schedule 2 products. Certain items can be exported through a designated STE without obtaining the relevant license. If a company’s exports go through this route, they are subject to the conditions contained in paragraph 2.11 of India’s EXIM policy.

■■ Customs Duties A customs duty is a type of indirect tax that can be placed on a company’s exported and imported goods. In India, customs duty law is drawn from the country’s Customs Tariff Act and is governed by the Central Board of Excise and Customs (CBEC).

Exports fall under the Act’s Schedule 2, whilst the provisions for imports are contained in Schedule 1.

In India, taxes are levied far more on imports than they are on exports, but there are several different kinds of duties which may apply to a company’s exported goods. This is usually in the case that the profit to be gained by selling internationally far outweighs that of selling domestically in India. The relevant duties are:

Basic Customs Duty The Basic Customs Duty (BCD) is the standard rate of tax levied on export goods in India. The rate of the BCD varies from product to product, with some items having a tax rate of up to 60 percent and others completely exempt from tax duty. The BCD for individual items can be found in Schedule 2 on CBEC’s website.

Anti-dumping Duty The anti-dumping duty may be applied on items which have an export market price that is deemed unfair by CBEC. Anti-dumping duty is more common on imports than exports, however.

Safeguard Duty The safeguard duty is activated if CBEC decides that exports of a certain trade good are negatively affecting India’s domestic industry, or may do so in the future. Safeguard duties can be put in place from between four to ten years. Like the anti-dumping duty, it is more common on imports than exports.

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

India International Leather Fair is a 3 day event being held from 1st February to 3rd February 2015 at the Chennai Trade & Convention Centre in Chennai, India.

This event showcases products like Leather, leather products, fashion accessories, machinery and equipment, chemicals etc. in the Leather & Leather Products industry.

BioAsia seeks to enhance, enrich and encourage newer innovations, path-breaking discoveries and effective solutions in the industry by offering a vibrant global platform for convergence of the key stakeholders - Biotech & Biopharma Companies, research institutions, investors, service providers, policy makers, regulators and analysts.

2-4 February Hyderabad India Newsletter • 21

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India Newsletter • 23

Embassy of India, Vienna

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

I

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

24 • India Newsletter

policy and Promotion, Ministry of Commerce & Industry) and State Governments of India (0.5% each), its mandate is to become the first reference point for the global investment community.

It provides granulated, sectorspecific and state-specific information to a foreign investor, assists in expediting regulatory approvals, and offers hand-holding services. Its mandate also includes assisting Indian investors make informed choices about investment opportunities overseas.

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TOURISM Hampi: A bridge over time

by Hugh & Colleen Gantzer It was, once, the Chandigarh of the South: a beautiful, planned and vibrant city.

Its planners had provided „sectors‟ .. though they didn‟t call them that… for their VIPs, Ordinary Citizens, Shrines, Administrators, Traders, Armed Forces, Sportspeople and, very pragmatically, also for those in search of the self-indulgent Good Life. Even Corbusier didn‟t go quite that far.

And all this happened 600 years ago Today, as we drove into Hampi, rocky hills rose on three sides of the vale of the swift-flowing Tungabhadra River. Within this secure place, monumental, honeygold boulders lay scattered. Rivers, rivulets and canals gushed through the valley, irrigating the rich soil. From here, the famed Vijayanagar dynasty had reached out over an Empire stretching from the Arabian Sea to the Bay of Bengal, guarded by a million troops and 15,000 cavalry.

The wealth of the empire poured into this glittering city and 200 policemen maintained good order and discipline in the power centre of this formidable nation. Hampi was a rigidly controlled, rich and efficiently administered city.

And so they could afford to revel in luxury..

The Queens’ Baths look rather blocklike from the outside. Inside, however, gallery-verandahs, with overhanging Rajasthani-balconies, encircle a 15-meter square bath. Cool, perfumed, water had poured in a minor waterfall at one side and flowed out through an underground drain. Significantly, the most prominent monuments in this area were devoted to festivities. From the highest platform of a massive amphitheatre, the king had had a grandstand view of jugglers, mummers, acrobats and, very likely, martial displays by his powerful army.

creatures from old Persian folklore and as Vijayanagar used to import horses from Persia, this sculpture probably reflects the West Asian connection.

On the other hand, in the walled area of the zenana, or women‟s quarters, there is an exquisitely Indian pavilion called the Lotus Mahal. In all likelihood, the king‟s ladies, who lived in the so-called Queens‟ Palace opposite, met in the Lotus Mahal on cool evenings.

Appreciably larger, and far studier, arches marked the long line of the Elephant Stables. When a defeated king fled from Hampi he carried his treasures on 1,500 elephants: wealth amassed because of the mutual accord between its secular and religious forces! The royal family, very astutely, built temples with superb works of art, installed powerful idols, and generally kept the priesthood happy.

Two of the most impressive, free-standing, idols are the ones of the, oddly named, „Mustard Seed’ Ganesh. and the LakshmiNarasimha. No one seemed to know when the 2.4 meter high idol of Ganesh was carved nor who sculpted the 6.7 meters high Narasimha monolith, out of a single granite boulder. Even in its present, damaged, state the awesome Man-lion dominates the green fields out of which it rises.

One of the more striking features of Hampi is the fact that a living village meanders through the ancient monuments. A red cow ambled past a green field backed by boulders cut for ancient sculptures; irrigation ditches gushed past shrines; and a child driving a flock of goats past the Narasimha monolith asked, in Hindi, “You

should see the Great Linga? It is the only one of its kind anywhere in the world!”We took his advice.

Standing in its own shrine, the huge stone linga, rises out of a massive yoni base, from the centre of a pool of water. It is aloof, powerful, monolithic and requires no idols or decorations to enhance its awesome presence.

There is just too much to see in the great expanse of this historic World Heritage Monument in a single tour. This time, however, we visited the Virupaksha : a living temple, and one of the most revered locally. It is five centuries old and we noticed a very unusual snake deity, multi-headed and glittering, occupying a side shrine.

We were near the end of our visit now and a saffron dusk softened the boulderstrewn slopes rising behind the ruins of the old bazaar. At the end of this oncecolourful street is the outstanding Vitthala Temple with an imaginative shrine built like a stone chariot. Its 500 year-old carvings, its musical pillars which sound like stringed instruments and bells when struck, and its setting near the flowing river, held us enthralled.

We walked away from the temple, towards the sloping banks of the river. Here, a large stone frame stood. On it, according to a persistent legend, the kings of Vijayanagar would have themselves weighed against gold coins which were, then distributed to the poor In Hampi, even welfare measures had been disguised as an effortless religious ceremony!

A short stroll away was the walled Hazara Rama temple, once reserved for royalty.

Its bas-reliefs are excellent and we were particularly intrigued by a hawk-like bird, not quite a traditional Garuda, with multiple wings. It resembled mythical India Newsletter • 25

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INVITATION FOR FLAG HOISTING CEREMONY The Embassy of India, Vienna, invite all Indian Nationals, persons of Indian origin and friends of India to the

Flag Hoisting Ceremony on the occasion of the

66th Anniversary of India’s Republic Day on Monday, January 26th, 2015.

Venue India House Spitzergasse 2, A-1180 Wien

Programme 09:45 Assembly at the Embassy Residence 10:00 Flag Hoisting by Ambassador Rajiva Misra 10:05 Reading of President’s Message by the Ambassador 10:30-11:00 Refreshments

Please R.S.V.P. to the event via email under infoasstt@indianembassy.at India Newsletter • 27

Embassy of India, Vienna

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

Rab Ne Bana Di Jodi - Ein göttliches Paar ■■ Synopsis: Surinder is married to Taani but there is a huge age gap between them. There is no real romance in the marriage. Then, a dance reality show called “Rab Ne Bana Di Jodi” airs and Taani wants to participate but can’t because her husband is not hip and happening.

She has a fear of losing, and she also fears that her friends will laugh at her. Surinder overhears her problem and decides to go in for a makeover.

He watches some movies and learns to dance in order to woo his young wife. Throughout the show, Taani keeps falling in love to with this newand-improved Surinder without once realizing that he’s really her husband.

■■ Genre: Comedy/Romance ■■ Directed by: Aditya Chopra ■■ Starring: Shahrukh Khan, Anushka Sharma and Vinay Pathak ■■ Released: 2008 ■■ Duration: 167 Minutes ■■ Language: Hindi ■■ Subtitles: German ■■ Image Quality: HD

Showtime January 30th, 17:30 Indian Embassy Business Centre (1st Floor, Kärntner Ring 2, 1010 Vienna) 28 • India Newsletter

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FILMS BY RITWIK GHATAK AT THE FILMMUSEUM VIENNA

From January 29 to February 12, 2015 “In Indian cinema, no one has managed to surpass the violence and epic beauty of his images,” said Satyajit Ray about his colleague Ritwik Ghatak (1925-1976), who was only posthumously recognized as one of Asia’s greatest filmmakers.

While Ray himself – as a person and as an artist – seemed to perfectly fulfill Western expectations of the Indian art film and served as its“poster child” (Jacob Levitch), the electrifying, fragmented, experimental work of the self-doubting “problem child” Ghatak offered no such comfort.

His nickname was “Burning Tiger” and his films were equally blazing.

The aspect of “epic beauty” that Ray cited can also be understood in the Brechtian sense – and during his lifetime, Ghatak translated Brecht’s work into Bengali. “For those who were lucky enough to see one of his films, Ghatak is one of those rare artists who by their way of showing things can change our own perception of the world,” wrote the French author, Hubert Niogret.

The son of an East Bengali judge, Ghatak spent a happy childhood surrounded by his family. The 1947 Partition of Bengal was a drastic experience: like millions of other Bengalis, Ghatak’s family fled East Pakistan (today’s Bangladesh) to India’s Calcutta, where Ghatak

soon joined both the theatre and the Communist Party. His cultural focal point was the “Indian People’s Theatre Association (IPTA), within whose orbit Satyajit Ray, Mrinal Sen and many later Ghatak collaborators also belonged. After a series of internal IPTA quarrels (Ghatak was labeled a “Trotskyite”), he found a fresh start in cinema – as well as a larger audience. However, his film debut, Nagarik (1953), was only screened after his death. Ray observed that had this film come out before his own debut film, Pather Panchali, the West would have discovered India’s cinema with Ghatak.

Ghatak’s Ajantrik (The Vagabond) was shown in 1958 on the margins of the Venice Film Festival and only Georges Sadoul celebrated the “young, exceptionally talented filmmaker.” Ghatak’s only public success came in the wake of his major 1960 work, Meghe dhaka tara (The Cloud-Capped Star), but this moment was not to last. Before he died at the age of 51, consumed by tuberculosis, tumors and alcohol, the filmmaker abandoned more projects than he completed. With autobiographical intensity, Ghatak told stories of survival – about defending a decent existence in the face of despair: in his unbelievable final work, Jukti. Takko aar gappo (Reason, Debate and a Story, 1974) Ghatak places himself in the story as an alcoholic; Komal gandhar (A Soft Note on a Sharp Scale, 1961) evokes the IPTA era; and Titash ekti nadir naam (A River Called Titash, 1973) remembers the delta landscape of Ghatak’s youth.

Rivers – the names of which make up the titles of his greatest epics,

Subarnarekha (1962) and Titash – and refugees are the central motifs of Ghatak’s tales about a country that no longer exists. Its political turmoil helped shape Ghatak’s aesthetic: tradition and modernity, as well as melodramatic, realistic and revolutionary ideas of miseen-scène ignite each other in a trilevel narrative; the individual drama mirrors larger social allegories and mythical images. Ghatak’s heroines like Nita in The Cloud-Capped Star sacrifice themselves in a national emergency as providers for their family: Mother India. At the same time they are ghosts of goddesses: as in all ancient myths, Ghatak describes the cycle of destruction and rebirth.

The mysterious, often nervous force and complexity of Ghatak’s art emerges from the interplay of conflicting ideas. Over powerful images, he imposes astonishing sounds: the crack of a whip accompanies Nita’s unforgettable descent, gunshots are heard over reports of Ghandi’s death in Subarnarekha. Music serves as a bridge – between concrete reality and desired universality, with compassion for the characters in their social and allegorical ambition and immoderate passion against which Ghatak himself struggled: “Man dies, but mankind lives on.”

Mankind only discovered Ghatak’s gift after his death: a unique vision of cinema, roaring like the great rivers that flow through these works.

The Film Museum will screen six of the eight films completed by Ritwik Ghatak. Two of his works – “Nagarik” and “Bari theke paliye” (1959) – are currently not available in their original format.

India Newsletter • 29

Embassy of India, Vienna

OVERSEAS INDIANS

Pravasi Bharatiya Divas Pravasi Bharatiya Divas (PBD) is celebrated on 9th January every year to mark the contribution of Overseas Indian community in the development of India. January 9 was chosen as the day to celebrate this occasion since it was on this day in 1915 that Mahatma Gandhi, the greatest Pravasi, returned to India from South Africa, led India’s freedom struggle and changed the lives of Indians forever.

PBD conventions are being held every year since 2003. These conventions provide a platform to the overseas Indian community to engage with the government and people of the land of their ancestors for mutually beneficial activities. These conventions are also very useful in networking among the overseas Indian community residing in various parts of the world and enable them to share their experiences in various fields.

During the event, individuals of exceptional merit are honoured with the prestigious Pravasi Bharatiya Samman Award to appreciate their role in India’s growth. The event also provides a forum for discussing key issues concerning the Indian Diaspora.

The Ministry of Overseas Indian Affairs The Ministry of Overseas Indian Affairs (MOIA) is an interactive ministry, dedicated to the multitude of Indian Nationals settled abroad. Established in May 2004 as the Ministry of Non-Resident Indians’ Affairs, it was renamed as the Ministry of Overseas Indian Affairs (MOIA) in September 2004. Driven by a mission of development through coalitions in a world without borders, MOIA seeks to connect the Indian Diaspora community with its motherland.

Positioned as a ‘Services’ Ministry, it provides information, partnerships and facilitations for all matters related to Overseas Indians (comprising Persons of Indian Origin (PIOs) and Non-Resident Indians (NRIs) .

The Ministry is headed by a Cabinet Minister. It has four functional service divisions to handle its diverse scope of services: ■■ Diaspora Services ■■ Financial Services ■■ Emigration Services ■■ Management Services The Ministry focuses on developing networks with and amongst Overseas Indians with the intent of building partnerships with the Diaspora.

Besides dealing with all matters relating to Overseas Indians, the Ministry is engaged in several initiatives with them for the promotion of trade and investment, emigration, education, culture, health and science & technology. Website : http://www.moia.gov.in

30 • India Newsletter

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NOTICE BOARD EMBASSY’S LIBRARY ■■ The EMBASSY’S library is opened DAILY from 10am to 1pm without appointment. NEW OPENING HOURS! ■■ For scheduling an appointment outside the opening hours, please contact the information assistant under infoasstt@indianembassy.at or 01 505 8666 33

BUSINESS CENTRE ■■ The EMBASSY’S Business Centre is opened DAILY from 10am to 1pm. NEW OPENING HOURS! ■■ For scheduling an appointment outside the opening hours, please contact the commercial wing under the contacts given below.

■■ Marketing Officer: marketingofficer@indianembassy.at or 01 505 8666 30 ■■ Marketing Assistant: marketingassistant@indianembassy.at or 01 505 8666 31

STUDENTS WELFARE OFFICER ■■ Mr. Pawan T. Badhe, Third Secretary in this Embassy has been designated as Officer to look after welfare of Indian Students in Austria and Montenegro.

■■ His contact details are: 0043 1 505 866 15 and cpolitical@indianembassy.at

MINISTRY OF EXTERNAL AFFAIRS GOES MOBILE Now you can...

■■ Avail services : passport, visa, consular assistance ■■ Ask your Minister : on the go, anytime, anywhere ■■ Follow your PM : on his visits abroad ■■ Find the nearest Indian Mission/Post : for emergency consular assistance ■■ Be informed : about India’s Foreign Relations on the move and form your own opinions ■■ Know more : about how to undertake Kailash Manasarovar Yatra and Haj Pilgrimage ■■ Download and watch : pictures & documentaries on India ■■ Play and Personalize : what you need, when you need ■■ Share and contribute : your views, pics & suggestions All this & much more on your smartphone Ministry of External Affairs proudly presents “MEAIndia” – an integrated smart app for mobile and other hand held devices ‘MEAIndia’ is now available for download on App Store and Google Play Store..

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