India newsletter 06. 2013

INDIA NEWSLETTER Published by the Embassy of India,Vienna Year 3 | Issue 30 | June 2013

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aviation

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QUICK FACTS

Snapshot of last month’s Highlights

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investment from the Indian ver 20 Euro- The mutual fund industry in software stood at Rs 19,196 crore (US$ pean corpora- stocks 3.49 billion) in March 2013. tions have set up he Indian IT engineering R&D infrastructure centres in India in market is projected the last year. he State of Andhra Pradesh (AP) to grow by 9.7 per Tis projected to add more than cent y-o-y to reach 4,000 megawatt (MW) in power generation capacity by March 2014.

US$ 2.1 billion in ith a growth 2013. total number of Internet conrate of 17 per The nections in India is expected to cent from 2005 to touch 380 million by 2017, growing at about 35 per cent annually. omestic pharmaceutical sales 2012, India’s exD registered an increase of 9.7 per ports during the cent in April 2013 as compared to period grew faster the same period last year. old demand in than the rest of the India grew by world, including 27 per cent to 256.5 China. ndia’s total foodgrain output in the tonnes in the first Ipresent crop year is projected to reach 255.36 million tonnes (MT), quarter of 2013.

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driven by higher production of rice, oilseeds and wheat. xports of agricultural and allied products from India have grown from US$ 29.8 billion in 2011-12 to US$ 33.54 billion in 2012-13.

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nline video consumption in India has doubled to 3.71 billion videos per month over the past two years.

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C shipments from India grew by 7.5 per cent to 2.71 million units during January-March 2013 as compared to the previous quarter.

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he Indian public sector banks (PSB) are expected to raise Rs

9.60 trillion (US$ 173.18 billion) in the 10 year period ending March 2021.

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round 33 per cent co-founders of engineering and technology startups in the US since 2006 are Indians.

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he market for rice bran oil in India is expected to grow by 15 per

cent to Rs 4,600 crore (US$ 826.90 million) in 2013.

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aboratory analytical instruments market in India is expected to reach US$ 2.37 billion by 2018.

utual funds ngineering exports from India Estood at US$ 4.5 billion in April invested US$ 2013.

86.14 billion into oreign direct inthe Indian debt vestment (FDI) market in 2012-13, making it their big- in India stood at gest investment in US$ 22.4 billion in 2012-13. the last 12 years.

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Articles

INDIA-FORUMS IN GRAZ AND LINZ

Event invitation by the ICS Steiermark and Export Center Oberösterreich

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s part of the internationalization initiative “go international”, an initiative

of the Federal Ministry of Economy, Family and Youth and the Federal Economic Chamber, the ICS Graz, Export Center Oberösterreich and the Austrian Trade Commision in New Delhi invite Austrian entrepreneurs to the industry forums: “FMCG, Luxury, Lifestyle & Design in India” Graz | 18.06.2013 | 09:00 Uhr IC Steiermark | Körblergasse 117 “Going to India and SouthEast Asia” Linz | 19.06.2013 | 09:00 Uhr WKO Oberösterreich | Hessenplatz 3

The industry forums shall provide a platform for interested Austrian entrepreneurs to get information about the business potential in the FMCG, Luxury, Lifestyle and Design in India. In addition to the focus on “FMCG, Luxury, Lifestyle and Design”, the event in Linz shall also cater to the “Renewable Energy Industry” with current opportunities for the sector not only in India, but also in SouthEast Asia.

The Austrian delegates in New Delhi and the industry experts shall present economic market data as well as case studies to help Austrian companies to successfully position their business in one of the largest markets in the world. Following the event, the atendees are invited for an Indian buffet and a networking opportunity to exchange views and for individual consultations with the delegates.

For more information and free registration, please refer to the websites below: http://www.ic-steiermark.eu (GRAZ) and http://www.exportcenter.at/ (LINZ)

Networking Seminar in collaboration with ICC Past Events Report

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he Embassy of India in collaboration with the International Chamber of Commerce (ICC) organized a Networking Event on 15th May 2013 with the aim of bringing together Austrian companies having business interest in India and to

provide them with a platform to share their experiences and/or provide answers to their queries.

The event took place at the Embassy Business Center (EBC) and counted with the participation of more than 20

companies from different industries. An introductory address for the event was given by Ambassador of India, H.E. Mr. R. Swaminathan, which will was followed by Q&A and discussion session. Some impressions of the event:

indian Classical Music Evening at the Embassy Past Events Report

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n May 10th, 2013, the Embassy of India hosted an Indian Classical Mu-

sic Evening by Sitar Maestro Pandit Satyendra Sharma Deo for the Indian Community and Friends of India in Austria. At its full capacity, the event was very successful. Some impressions of the event follow: India Newsletter | 3

Articles

India leads among BRIC nations HSBC Survey

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ndia expanded at a better rate than the three BRIC peers China, Russia and Brazil in May 2013, according to a survey

by HSBC. The HSBC composite index for India, which records manufacturing and services sector, stood at 52 in May 2013, whereas it was 50.9 for China, 51.2 for Brazil and 51 for Russia.

An index measure of above 50 indicates expansion.

“India has been the bright spot among

the largest EM countries, while a combination of external headwinds and domestic issues has led to weakening growth in Brazil, China and Russia,” said Mr Andre Loes, Chief Economist for LATAM, HSBC. The HSBC Emerging Markets Index (EMI), a monthly indicator derived from the PMI surveys, remained unchanged from April 2013 at 51.4 in May 2013.

Growth accelerated in India on the back of a stronger services sector performance.

Employment grew marginally in May 2013. This was despite goods producers registering a fractional cut in staffing, highlighted HSBC survey.

The HSBC Emerging Markets Future Output Index that tracks firms’ expectations for activity in 12 months time rose for the first time in three months in May. Improved sentiment was driven by the services sector, as manufacturing output expectations were the weakest in five months, according to HSBC.

Govt relaxes norms for export of imported goods Foreign Trade

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o encourage shipments, the government has allowed export of imported goods with 15 percent value addition to countries from where the proceeds are realised in Indian rupee.

The Directorate General of Foreign Trade (DGFT) will notify the names of those countries as to which exports under the new dispensation could be made.

“An enabling provision has been made to allow export of goods imported against payment in freely convertible currency where export proceeds will be realized in rupees,” it said.

It said that this dispensation will be applicable to such countries as would be notified by DGFT from time to time.

“They also have to achieve 15 percent value addition,” it added.

India’s exports in 2012-13 fiscal fell for the first time in three years reporting a dip of 1.8 percent to USD 300.6 billion in 2012-13, taking the country’s trade deficit to a record high level of USD 191 billion.

Amazon clicks into Indian online marketplace e-commerce in India

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mazon, the world’s largest online retail company, has entered the Indian e-commerce space, promising low price for users and a better platform for sellers. India is the tenth market where Amazon has launched a country-specific retail Web site.

2012, it made its foray into the Indian market with the launch of Junglee.com, which connects buyers with online and offline retailers but with no sales transactions.

But unlike Amazon sites in other countries, the Indian venture is limited to third-party sellers. Amazon will not sell its own inventory due to foreign direct investment (FDI) regulations prohibiting foreign retailers from selling their own products online.

The launch of Amazon.in comes at a time when other e-commerce sites in the country have not been doing well.

There are challenges including customer suspicion towards the quality of products sold online and lack of trust in payment mechanism.

To start with, consumers will be able to buy books, movies and TV shows. Amazon.in will introduce additional categories including mobile phones and cameras in the coming weeks. On Day 1, the book store featured over seven million print books across 200 plus categories while the video store featured a collection of over 12,000 titles in English and Hindi.

Amit Agarwal, Vice-President, International Expansion, Amazon.com, told Business Line that while these challenges are real, other markets have shown similar trends at the nascent stage. “When you make your investment decision with a timeframe of 10 years then these things do not matter,” he said. From the consumer point of view, Amazon offers a platform that is aimed at offering a low price on any product by allowing sellers to compete.

While Amazon has not previously had a branded presence in India, in February 4 | India Newsletter

Real challenges For the seller, Amazon is offering unlimited shelf space with no listing fees.“From packaging to taxation to delivery logistics we are offering all of it in a simple package to sellers,” said Agarwal.

Pan-INDIA REACH “Selling on Amazon presents an exciting opportunity as it opens up a new sales channel with pan-India reach at virtually no investment,” said M. S. Jaya Prakash, Proprietor, EducationSupplies. “Prior to this, I did not sell online and was apprehensive about how to fulfil online orders in a timely manner, handle customer service and manage returns.”

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MSME share in exports was 43% in 2011-12 Micro, small and medium enterprises in India

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he share of micro, small and medium enterprises (MSME) in India’s total exports has been provisionally estimated at 43 per cent in 2011-12, according to the ministry of MSME. Besides, the ministry estimates total fixed assets of MSMEs in India at Rs 689,000 crore and the number of people employed by the sector at around 80 million.

Minister of State (Independent Charge) for MSMEs K H Muniyappa said in the Rajya Sabha recently that “under a revised method of estimation, the share of MSME product exports in total exports of India has been provisionally estimated at 43 per cent in 2011-12”.

According to Directorate General of Commercial Intelligence and Statistics (DGCI&S) data, in the last three years, MSME exports increased by almost 60 per cent - from $82,494 million in 2009-

10 to $131,483 million in 2011-12.

The main markets for the 20 mostexported MSME product groups, which accounted for more than 90 per cent of MSME exports from 2009 to 2012, include the USA, European Union (EU), UAE, Turkey, Singapore, Hong Kong, Israel and Saudi Arabia. (TOP-10 STATES BY MSME FIXED ASSETS) The product groups include pearls, precious stones and metals; electrical and electronic equipment; textiles, apparel and accessories; pharmaceutical products; machinery and mechanical appliances; items made of iron or steel; organic chemicals; vehicles other than railways and tramways; plastics, rubber and articles made from them; footwear, leather and leather products; travel goods; tools, implements and cutlery; tanning and dyeing extracts, tannins, derivatives and pig-

ments; essential oils, perfumes, cosmetics and toiletries; stone, plaster, cement, asbestos and mica; carpets and other textile floor coverings; furniture, lighting, signs and prefabricated buildings.

“The MSME sector of India has been repeatedly mentioned as the growth engine of the Indian economy, but the depth of its achievements is often not fully appreciated,” Muniyappa said on another recent occasion.

The MSME sector, with 36 million enterprises having fixed assets of Rs 689,000 crore and 80.5 million employees, contributes around nine per cent of India’s GDP and accounts for around 45 per cent of manufacturing output. It has been continuously growing at a rate far above the large sector.

India probably world’s 3rd largest economy OECD Report

India has probably surpassed Japan to become the world’s third largest economy after the US and China, Paris-based think-tank OECD said today even as it lowered the country’s economic growth projection for 2013 to 5.3 per cent.

ation and Development (OECD), which in November had projected India to grow at 5.9 per cent in 2013, cautioned that structural bottlenecks in the country could further constrain investment and growth potential.

“China will likely pass the United States as the world’s largest economy in the next few years and India has probably recently surpassed Japan to be third largest,” said the OECD Economic Outlook report.

“GDP growth is projected to rise gradually over the next two years... Significantly more growth would be forthcoming if structural bottlenecks were swept away by fundamental structural reforms,” the report said.

Until around 2020, China is set to have the highest growth rate among major countries, but could be then surpassed

by India, it further said.

Looking ahead, it said India is likely to improve growth to 6.7 per cent next year, after having logged a decade’s low of 3.8 per cent in 2012.

OECD also said that by early 2030s, the BRIICS’ (Brazil, Russia, India, Indonesia, China and South Africa) combined GDP should roughly equal that of the OECD (based on current membership), compared with just over half that of OECD now.

OECD said the world real GDP is projected to increase by 3.1 per cent this year and by 4 per cent in 2014. Across OECD countries, GDP is projected to rise by 1.2 per cent this year and to improve to 2.3 per cent in 2014. Growth in non-OECD countries will rise by 5.5 per cent this year and 6.2 per cent in 2014.

“Between now and 2060, GDP per capita is seen to increase more than 8-fold in India and 6-fold in Indonesia and China,” it added.

The Organisation for Economic Cooper-

In the US, activity is projected to rise by 1.9 per cent this year and by a further 2.8 per cent in 2014, OECD said.

GDP in the euro area is expected to de-

cline by 0.6 per cent this year and then rebound by 1.1 per cent in 2014. Japan’s GDP is expected to grow by 1.6 per cent in 2013 and 1.4 per cent in 2014, it added.

Talking about India’s neighbour China, OECD forecast that its economy would grow 7.8 per cent this year, down from a previous estimate of 8.5 per cent.

Referring to India, it also said the fiscal tightening and the new fiscal consolidation roadmap are “welcome and should allow monetary policy to be eased further”.

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Economy turning around: GDP growth to exceed 6% Prime Minister’s Statements on India’s Economy

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ndicating that the worst may be over for India’s economy, Prime Minister Manmohan Singh said that the economic situation is turning around with inflation coming under control and the gross domestic product (GDP) growth likely to exceed 6 per cent in the current fiscal year.

Speaking on the fourth anniversary celebrations of UPA-II government in Delhi, the Prime Minister said 8 per cent growth rate was possible if the Congress-led coalition is voted to power again next year.

“The economic situation is turning around. Inflation is coming under control.

The fiscal deficit is being brought under

control. The current account deficit is high, but we will bring it down gradually...

We are confident that growth in 201314 will be better than 2012-13 and could exceed 6 per cent,” he said.

Attributing the decline in economic growth--estimated to be 5 per cent in 2012-13-- to global phenomenon, he said the “slowdown is temporary”.

A 6 per cent growth in the current year will set the stage for returning to 8 per cent growth in the current Five Year Plan period ending March 31, 2017.

“This will be difficult, but it is not impossible. We have done it before, and if we receive a mandate next year, we will cer-

tainly achieve it again,” he said.

Stating that agricultural growth was critical for rural prosperity, the Prime Minister said the government was targeting 4 per cent growth in the sector and is attempting to increase foodgrain production as well as diversifying agriculture.

“This is the foundation which allows us to introduce Food Security legislation in Parliament,” he said, adding that the government had also introduced the Land Acquisition and Rehabilitation Act to replace the old and highly unfair colonial legislation. The new Act will be much fairer to those whose land is acquired, Mr Singh said.

India M&A deals record US$ 1.66 billion in April 2013 Report by Grant Thornton

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he total mergers and acquisitions (M&A) in April 2013 were valued at US$ 1.66 billion through 39 deals as compared to US$ 1.97 billion by way of 60 transactions during the same period last year, according to the data released

by Grant Thornton. There has been a significant increase in inbound deals and this trend is likely to continue in the coming months.

were valued at US$ 1,121 million, followed by domestic deals (US$ 488 million) and mergers and internal restructuring at US$ 60 million.

263.70 million) and Qatar-based investment firm Hassad Food buying majority stake in basmati rice company Bush Foods for over US$ 100 million.

“We expect significant uptick in the inbound arena. Similarly, we are seeing resurgence in outbound transactions and expect to see significant uptick in this area from both, IT and manufacturing sectors,” said Mr Harish.

“Cross border deals and in particular inbound deals are seeing strong resurgence. Unilever’s investment announcement preceded the Diageo transaction, which is now in its final legs. These are two significant transactions,” as per Mr Harish HV, Partner, India Leadership Team at Grant Thornton India LLP.

The deal of the month was Etihad Airways acquiring 24 per cent of Jet Airways for US$ 379 million.

“We continue to see Indian corporates focused to divest non-core assets to enhance liquidity such as DLF stake sale in wind power assets for over $ 100 million,” said Mr Raja Lahiri, Partner, Transaction Advisory Services at Grant Thornton India LLP.

During April 2013, cross border deals

Other major M&A deals in April 2013 include Bharti Airtel, acquiring 100 per cent stake in Bangladesh’s Warid Telecom, followed by Aditya Birla Nuvo selling its carbon black business to group firm SKI Carbon Black for Rs 1,451 crore (US$

The foreign direct investment (FDI) regulatory changes in sectors and government’s push to attract FDI, the Etihad-Jet transaction is good for the aviation sector and we believe that more such inbound deals are expected to play out in sectors such as aviation, retail and broadcasting, added Mr Lahiri.

In FY13, NRI deposits climb 19% Non-Resident Indians deposits

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ured by higher returns offered by banks in their homeland, non-resident Indians (NRIs) placed deposits aggregating $14.18 billion in the FY ended March 2013, an increase of 19% over 2011-12.

In the previous year, NRIs parked deposits aggregating $11.92 billion with banks in India. NRIs placed deposits predominantly in non-resident (external) rupee account or NRE account. NRE deposits with the banking system jumped 85 per cent (rising by $15.81 billion in FY13 compared to $8.53

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billion in FY12), according to Reserve Bank of India data.

The attractiveness of NRE deposits lies in the fact that banks quote the same interest rate on these as on domestic deposits.

For example, State Bank of India is quoting 8.75 per cent on NRE deposits of one- to 10-year duration. Also, the principal and interest are fully repatriable and the interest earned is exempt from Indian income-tax.

“The rising trend in NRE deposits is an

indication that the NRIs expect the rupee to appreciate down the line. So, the NRIs are not only gaining by way of interest rate but also on account of favourable exchange rate conversion factor,” said a banker. In FY13, the banking system’s NRO (nonresident ordinary deposits) shrunk by $1.8 billion (against an accretion of $4 billion).

Since NRO deposits are non-repatriable and require submission of tax-residency certificate and self-declaration, bankers say these deposits have become unattractive.

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India’s entry into Europe clubto help SMEs expand footprint As reported in the CII newsletter, MSME Business

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ndia has become a member of the Enterprise Europe Network (EEN) - the 54th country to do so - in a bid to facilitate the flow of trade, investment and technology between SMEs in India and the European Union (EU), according to a recent issue of the CII newsletter, MSME Business.

The EEN works through local business organisations to help SMEs make the most of the European marketplace. India’s entry into the EEN will give the country’s SMEs access to Europe’s large database of cutting-edge technologies, with companies from the 27-member bloc both offering and seeking research and commercial applications in 17 sectors, including agro-food, automotive, transportation

and logistics, biotech and health care.

The EU has been a difficult market for Indian SMEs, given its complexities, stringent rules and protectionist tendencies, but India’s membership of the EEN is expected to make a difference. CII, along with the European Business and Technology Centre (EBTC) and the Federation of Indian Export Organisations are partners in this initiative, and contact points for Indian SMEs. The network serves as a one-stop shop for enterprises looking to go global with their innovative ideas. The EEN can provide insights on sources of venture capital and loans; the best way to sell a business plan to investors; getting aid from

regional, national or EU authorities; and accessing public funds and grants for research and development.

The EEN’s business cooperation database of some 23,000 profiles and business support organisations from 54 countries enables SMEs to utilise it to search for international business partners and sourcing new technologies and advisory services on issues such as intellectual property, going international, or EU laws and standards. The network ensures that SMEs looking to expand their business to another country find competent and trustworthy partners, as well as assess how EU laws and regulations affect businesses.

Foreign investors increase stake in India Inc Foreign Investment in India

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ith foreign investors pumping a massive $10 billion in Indian markets in January-March , the second highest ever in a quarter, FII ownership in top-500 companies has hit an all-time high of 21.2% for the quarter ending March. It climbed 1.28% in the JanuaryMarch quarter alone and 2.87% in 201213 . Along with foreign promoters (7.6%), foreigners are now the most dominant shareholders in India Inc. FII inflows topped $25.8 billion during the one-year period ending March 2013, the second best ever. Though FII ownership of India Inc. has hit a peak, their exposure to Indian markets remains well below the highs achieved earlier. The value of FII portfolio stood at $236.2 billion, data compiled by Citi Research and the Centre for Monitoring Indian Economy showed. It hit an all-time high of $276.5 billion at the end of December 2010.

Significantly, foreigners (FIIs and foreign promoters ), with a combined ownership of 28.8% in BSE-500 companies, are now ahead of Indian promoters, who on an average held 27.7% stake in these firms.

The churn on the back of Unilever’s aggressive open offer to shareholders and promoter stake sales to meet the minimum public shareholding norms stipulated by market regulator SEBI has led to the decline .

FIIs own a quarter of the largest companies in the country. They own 25.32% in sensex companies compared to the average 23.37% owned by Indian promoters in these 30 blue-chip firms. “FII flows would continue as the interest rate cycle has turned favourable,” says Kishor P Ostwal, Managing Director , CNI Research, an equities research provider. “It is largely driven by global liquidity ,” says Vikram Dhawan , Director, Equentis Capital.

Since stock valuations in developed markets are ruling higher, money has started to move into emerging markets such as India, he says.

declined 3% during January-March on the back of heavy selling from domestic institutional investors (DIIs ).

The average stake held by DIIs dropped 0.24% in 2012-13 during which they pulled out about $12.7 billion from the equity markets. “Domestic investors have been facing redemption pressure.

But they held rather tenaciously to their ownership levels,” market observers said.

FII ownership in financial services and consumer staples companies remained high.They have also increased their stakes in energy , telecom and healthcare firms.

They have also started to reduce their exposure to IT companies. IT is now the biggest underweight for FIIs, data showed.

FII ownership matters a lot for stock price movement . Stock prices of most companies in which FIIs increased their holdings went up in January-March . All the top companies where FIIs cut their exposure during the quarter witnessed a fall in stock prices. Stock prices plunged 12% to 30% in these companies during the period.

The increase in FII stakes has however failed to move the markets. The markets

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Articles

India’s exports growth outpaced China’s in 2005-12 period Foreign Trade

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ndia outpaced the rest of the world in terms of exports growth in 2005-12, charting a 17 per cent improvement over the seven-year period. As per the latest World Trade Organisation (WTO) report, this was even higher than arch-rival China’s exports growth of 15 per cent between 2005 and 2012.

The exports growth registered by the powerhouses of the Asian economy was significantly higher than the global aver-

age of 8 per cent in the 2005-12 period.

But India was able to achieve the distinction despite a 3 per cent decline in exports in 2012, even as China recorded 8 per cent growth for the year. Globally, exports remained at the same level in 2012 as the previous year.

But in the subsequent two years, exports witnessed high growth due to steps taken by the government to boost exports, besides weakening of the Indian rupee.

But exports witnessed a declining trend in 2012-13 on account of the worsening euro zone crisis and poor global demand.

Delving into India’s export performance, it emerges that growth in overseas shipments slowed to 13.6 per cent in 2008-09 and then fell to -3.5 per cent in 2009-10.

As per WTO data, India’s rank as one of the leading exporters of the world improved from 31st position in 2000 to 19th position in 2012.

Facebook aims to make India its largest market Social Networking

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Mobile and Corporate Development, Facebook, told Business Line.

With 78 million users, India is now its second largest market after the US. But the fast paced growth of mobile and data services here makes it a huge opportunity for the company.

At the centre of India gameplan is the ‘mobile first’ strategy that the company announced globally a year ago. Facebook has 195 million users in the US and Canada combined and to go beyond that mark the company is offering services in regional languages in India.

ocial networking giant Facebook wants to make India its largest market in terms of number of users.

As of March 31, Facebook had 1.11 billion users globally, an increase of 23 per cent compared with a year ago. In India, the social networking company saw a 50 per cent increase in user base during the same one-year period. “India is an exciting market for us because we are at the start of the data boom. We have found that the primary reason for Indians to subscribe to data is to get on to Facebook,” Vaughan Smith, Vice-President,

For instance, it launched a programme called “Facebook for Every Phone” app, which delivers smartphone-like Facebook experience on feature phones in Hindi and other Indian languages including Gujarati, Tamil, Malayalam, Kannada, Punjabi, Bengali and Marathi.

Facebook is also aggressively looking at operator partnerships to drive up usage.

It had done deals with Airtel, Reliance, Aircel and Idea for allowing their subscribers to surf Facebook for free.

The recent partnership with Nokia is another example. Airtel subscribers buying Nokia Asha 501 will get free data access for all mobile Facebook Web pages.

“With free data package, the users get hooked and then they want to use it regularly. This is good for operators too as data usage grows,” said Smith.

But the big challenge for the company would be to grow its revenues from India in line with the user growth. Facebook now gets 30 per cent of its revenues globally from mobile. While India-specific revenue numbers are not available, the focus for now is to capitalise on the 850 million mobile phone users.

Nasscom targets $10 billion from software by 2020 Information Technology

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ndia’s information technology industry body Nasscom has created a separate unit to drive its newfound enthusiasm for software products, and has set a target of increasing by nearly five-fold revenues from products by 2020.

The product council of the National Association of Software and Services Companies will be chaired by Ravi Gururaj, a serial entrepreneur who is the cofounder of a seedstage angel fund Frictionless Ventures. The formation of a product council is one of the measures proposed by a committee headed

by NR Narayana Murthy, the chief mentor of Infosys.The panel was established to bring Nasscom up to date with the current needs of the industry.

In 2012-13, Indian software products

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notched up around $2.2 billion (Rs 12,000 crore) in revenue, of which 30% came from the domestic market.The aim is for $10 billion (Rs 55,000 crore) in sales by 2020.

can lobby with the government to make them happen,” said Sharad Sharma, one of the founder-members of iSpirt, welcoming Nasscom’s move.

“Product companies and startups are the next growth engines for the industry,” said Krishnakumar Natarajan, Nasscom chairman and CEO of software firm Mindtree.

Nasscom, which represents India’s $108 billion (Rs 5.9 lakh crore) software services sector, has been facing criticism from smaller and newer members for its inability to adequately address the aspirations of software product companies. In February, around 30 product companies formed a separate grouping called Indian Software Product Round Table (iSpirt). “We are a think-tank; we frame policies.As a trade body, Nasscom

A survey of 100 product companies by Nasscom found that 68% felt market access and customer acquisition were key concerns. Raising funds and other capital related issues came second, followed by finding the right talent and scaling operations. Gururaj said the Nasscom product council would help in establishing large one, with small and medium businesses adopting locally developed software products.

Areas such as cloud, software as-a-service, big data and analytics, social and mobility are large global opportunities.

Articles

Dutch firm Coram to use India as base Foreign Companies’ Operations in India

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oram International, the Netherlands-based coordinated design bathroom company, is set to start operations in India from July this year.

The company, which set up a whollyowned subsidiary in India in 2012, also has plans to set up a manufacturing facility for its flagship products in India, which is identified as the “sweet spot” for Coram. “There is good potential. But we would put up the plant once there is certain scale. India is likely to emerge as the manufacturing base for our operations in Asia over the next few years,” said Niels Pilaar, CEO, Coram International.

Huge population, coupled with affinity towards European designs, are the key reasons why Coram has decided to shift focus to India, said Pilaar. “Europe has become saturated and is declining as a market. Though China has the advantage of

being the world’s largest population, it is not an easy market because of excessive Government interference,” he added.

The company would require about $10 million to set up a manufacturing unit which can be expanded depending on requirement. “The investment in India for a possible manufacturing unit is yet to be firmed up. It would depend on the time and scale. However, investments would come from the parent firm,” said the CEO. India would be the first country outside Europe where Coram is planning to establish a manufacturing facility. At present, it has production units in Holland, Poland, the UK, Germany, France and Italy. It also has an assembly unit in Malaysia. Pilaar said Coram’s India unit could initially target markets like Indonesia and Vietnam.

By July, the company will set up two experience zones, to have direct consumer connect, in Delhi and the National Capital region. Later, it would look at other parts of the country, starting with cities like Ludhiana, targeting bungalows and other residences.

Coram’s Xtreme wellness bathroom set up costs about Rs 15 lakh, while its product range starts from Rs 2 lakh.

Coram offers the coordinated design bathroom solutions with the possibility of added sustainable Xtreme wellness. Pilaar said annual sales of more than 5,000 units would make manufacturing viable in India.

At present, Coram gets about 90 per cent of its revenue from European markets.

D-Link to set up testing lab in India Foreign Companies’ Operations in India

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etworking solutions provider DLink is planning to set up a testing lab in India in the second half of this year to ensure better localisation, its chairman A P Chen said.

dian testing lab,” Chen added.

At present, D-Link has testing labs in Russia, its biggest market until recently, South America, China and Taiwan.

However, there is no immediate plan to start manufacturing in India. At present, India accounts for about seven to eight per cent of D-Link’s global revenue and is growing at more than 20 per cent annually. “We may look at setting up a production unit here in the future if there is a certain scale,” he said.

The testing lab will be set up in Goa. Besides the lab, D-Link will have its own service centre and support system for repairing in the Goa facility. “We also have plans to serve markets like Sri Lanka, Australia and Singapore from the In-

The company is also evaluating possibilities of establishing a software development centre in India within a year, said Chen.

Chen said the company had witnessed

a decline in sales in the US, Europe and Russia. At present, Europe has emerged as the largest market for D-Link with about 22 per cent of its global revenue.

In India, D-Link is planning to start D-Link Direct Service (DDS) for consumers so that it would pick up faulty products directly from the consumers’ place and instantly replace it with a new product.

Meanwhile, D-Link Holding Mauritius, the 100 per cent subsidiary of D-Link Corp, which holds a 60.37 per cent stake in listed D-Link India, is reportedly planning to delist the Indian arm.

Honda opens third 2-wheeler plant in India Foreign Companies’ Operations in India

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onda Motorcycle and Scooter India (HMSI), India’s second-largest twowheeler company, plans to expand its installed annual capacity by 15 per cent to 4.6 million units by March 2014.

The company inaugurated a plant at the industrial area 58 km from Bangalore, its third plant in the country, after those in Manesar in Haryana and Tapukara in Rajasthan.The three plants have a combined capacity of four million units a year. The Narasapura plant would initially pro-

duce 1.2 million units a year. By March 2014, additional capacity of 600,000 units would be added, through a third assembly line, said Keira Muramatsu, president & chief executive. The Narasapura plant would see a total investment of Rs 1,350 crore, including the funds for expansion.

The company has acquired 23 acres from the Karnataka government for creating additional facilities such as a safety riding track. By the end of this financial year, the plant, spread over 96 acres, would

provide employment to 4,500 people, said Yadvinder Singh Guleria, vice-president (sales and marketing). The company would produce the Dream Yuga motorcycle at the plant from June. Two months later, it would start manufacturing Activa scooters on the second assembly line, he added.

Accordingly, the company would reduce the Activa’s waiting period from the current 15 days.

India Newsletter | 9

Articles

Italian shoemakers eye India Foreign Companies’ Operations in India

H

igh-end and super-expensive Italian shoemakers are looking at India as a replacement for their production base in Europe, increasingly a high-cost location for them. These brand manufacturers are also scouting for local partners. Some of these are leading brands such as Baldinini, LORIBLU, Giovanni Fabiani, NeroGiardini, Janet & Janet, FABI and Fratesi.

Another attraction is growing demand here for their products, unlike in Europe, though their footwear could cost anything between Rs 29,000 to Rs 1 lakh for a pair.

“Italian producers and manufacturers are looking for countries where the labour cost is lower, which is why they are looking at India,” Amedeo Scarpa, trade promotion attaché at the Italian embassy, told Business Standard.

He said these brands were exploring markets in the BRICS (Brazil, Russia, India, China and South Africa) countries, where the raw material cost is lower than in Europe. Analysts said China could give competition to India in this respect but India was increasingly having the advantage in terms of cost of labour.

“We are looking at more and more joint ventures and collaborations with Indian

producers because Indian industry gives us the volume that these companies are now looking for,” said Scarpa. Around 40 high-end European leather and footwear brands, including those from Italy, Germany, France, the UK, Spain and Austria, are going to showcase their products at the Expo Riva Schuh India, an international shoes and leather accessories show in Pragati Maidan on July 4-6.

“We want to shift from a concept of ‘Made in Italy’ to ‘Made with Italy’ as we go for more and more joint collaborations. This will be our way in entering the market,” said Scarpa. Adding, however, that the Indian market had a lot of trade barriers which sometimes affect the ease of doing business here.

“We have to find the part of the global value chain and where there is competitiveness. So, the more you lower your barriers, the more attractive investment destination you will be,” he said. Italian companies, said Scarpa, were also eagerly waiting for the India-European Union free trade agreement (FTA), under negotiation for a long while, to be signed. It could help them get more access to the Indian market, with the lowering of tariffs.

According to Carla Costa, fair manager

of Riva Del Garda Fierecongressi, the demand for shoes of this type which can cost EUR400-2,000 each, was growing in India.

In Europe, the number of buyers are declining. Besides shoes, these brands also produce luxury bags, belts and wallets.

“India has a huge population and demand for such goods is on a rise here compared to Europe, where buyers are not ready to buy these costly shoes. So, we are now looking to go out of Europe.

Prices in Europe are very high. The real demand is here,” adds Costa.

Overall, the Indian footwear market is estimated at about Rs 19,900 crore, with a yearly growth rate of eight to 10 per cent. The market includes casual, formal, semi-formal and sports shoes, along with sandals for men and women.

The men’s segment is 59 per cent of the market. The overall share of organised retail is 20 per cent and is expected to reach 25-30 per cent by 2015.

Of the total market, the super-rich segment might constitute only a small portion but Italians believe it would still be higher than demand for their products in Europe, facing low economic growth.

India and THE UK sign MoU on cooperation in health sector International

U

nion Minister of Health & Family Welfare India, ShriGhulamNabi Azad and Secretary of State for Health, UK, Mr. Jeremy Richard Hunt signed an MOU on cooperation in the field of health sector between the Government of India and the Government of the United Kingdom of Great Britain and Northern Ireland.

Describing the agreement as a historic event and a great milestone, Shri Azad noted with optimism that this agreement is going to usher in a new era of cooperation in the health sector between the two countries.

Shri Azad stated that the agreement between India and UK will promote wideranging cooperation in the health sector between the two countries and spur the exchange of information and expertise for the common good of people.

The areas identified for cooperation in 10 | India Newsletter

the MOU include:

• Promoting exchange on healthcare policy in India and the UK;

• • • • •

Human resources for Health;

ernment of India partnership has been improvement of maternal & child health and reducing the burden of communicable diseases.

• Health security, including coopera-

Shri Azad also noted with satisfaction that Department of Health Research, GOI and National Institute of Clinical Excellence (NICE), UK are in the process of signing an agreement for collaboration in areas relating to medical and health technology assessment.

It is worthwhile to mention that India is a strategic partner to the UK and has been a recipient of UK’s bilateral assistance in the form of grants since 1975.

The aid agency of the UK is Department for International Development (DFID).

The priority for the DFID (UK)- Gov-

Recalling the historic relations that the two countries share, Sh Azad noted that the signing of this agreement demonstrates the commitment of both the countries to work closely with each other to further cement their strong relations.

Regulatory issues; Health technology development: Primary healthcare; Strengthening of public infrastructure and capacity; tion on infectious diseases, emerging infections and drug resistance.

Interview

India and Netherlands sign MoU on technical cooperation in urban planning and management International

S

hri Kamal Nath, Minister for Urban Development & Parliamentary Affairs, and Ms Melanie Schultz van Haegen, Minister for Infrastructure and Environment, Netherlands signed a Memorandum of Understanding on Technical Cooperation in the field of “Spatial Planning, Water Management , and Mobility Management” on 14th May 2013 at the Hague, Netherlands.

At the bilateral meeting, Shri Kamal Nath spoke about the Urbanization challenge being faced by India and the determination of the Government of India to address it in partnership with the technical and professional experts and business leaders of both countries. Shri Nath re-

iterated that addressing the urbanization challenge provided a huge opportunity for cooperation including in the area of Private Public Partnership.

that the first seminar under the MoU would take place in June 2013 at Rotterdam to be followed by another seminar in India later in the year.

The Memorandum of Understanding will enable greater cooperation in the areas of - Spatial planning, urban and regional planning and development and architecture; Water management in terms of Water supply and sanitation and governance structures; Transport management and transport systems and infrastructure; Energy-efficient and sustainable built forms

On 13 May, Shri Kamal Nath, met Ms. Lilianne Ploumen, Minister for Foreign Trade and Development Cooperation, Ministry of Foreign Affairs. While noting that the bilateral trade between India and Netherlands has been increasing at a brisk pace, it was agreed that there is a need to expand the trade basket to other important areas such as Urban Development. Minster Ploumen is likely to visit India with a trade delegation later in the year, which would also include representatives of the urban sector.

Under the MoU, a Joint Working Group would be set up that would prepare annual work programmes. It was decided

India one of the top tourism destinations in Asia CNN Global Travel Survey

I

ndia is one of the top tourism destinations in Asia, according to findings from a CNN global travel survey released recently.The results also position the country as the region’s fourth fastest growing tourism destination and the third most attractive business for investment opportunities, right after China and Hong Kong.

One-fifth of CNN’s audience of global travelers considering a visit to Asia Pacific, would consider visiting India in the 12 months and experts say its celebrated culture could be a prime reason. The destination fended off competition from Japan and Thailand to rank as the no. 1 destination in the region with the second

richest culture and heritage, with only China scoring more in this category.

The study, entitled ‘CNN Consumer Connect - Travel and Tourism 2013’, looks at consumer travel trends, perceptions and behavior, and was hosted on all CNN websites worldwide. It polled more than 3,000 readers based in over 70 countries around the world and included 25 Asia Pacific destinations.

Duncan Morris, vice-president of Research at Turner International Asia Pacific, said, “These results are great news for India and the Asia Pacific region as a whole. CNN consumers are discerning, affluent global travelers and they clear-

ly indicate a desire to visit this part of the world to enjoy a particular brand of hospitality, food, culture - everything that makes a travel experience distinctive. At a time where money in the household is perceived to be tighter, spending on travel is still obviously a priority for many”.

A look at ‘travel perceptions and behavioral trends’ reveals that safety and security issues are of greater concern for two-thirds of global respondents when choosing an international travel destination. Asia Pacific-based travelers prioritize price slightly more than the global average, while reputation is third in their list of considerations.

India Newsletter | 11

Industry

aviation INDUSTRY Indian Industry Sector Close-Up

A

fter the Indian aviation sector underwent liberalisation in late nineties, it has seen a flurry of private service airlines entering the industry. The aviation sector in India holds immense potential for growth; more so because it receives great impetus from the booming tourism industry driven by higher disposable incomes and favourable demographics.

Also, the robust policy regime created by the Indian Government acts as the blood-line of this industry. While the last five years have witnessed significant investments by large and small domestic companies, indigenous aerospace and defence industry has been evolving in a big way.

Recent developments and statistics pertaining to the sector are discussed hereafter.

Market Size Total domestic passengers carried by the scheduled domestic airlines in November 2012 were 5.02 million (465, 000 higher than those carried in October 2012). The number of passengers carried by domestic airlines was 53.4 million between January-November 2012.

The market share of scheduled domestic airlines for the month of November 2012 was: Air India-20.7 per cent, Jet Airways-18.3 per cent, JetLite-6.9 per cent, IndiGo-27.3 per cent, Spice Jet- 19.5 per cent and Go Air- 7.4 per cent.

The air transport (including air freight) in India has attracted foreign direct investment (FDI) worth US$ 448.40 million from April 2000 to December 2012, as per the data released by Department of Industrial Policy and Promotion (DIPP).

Key Developments and Investments

• Jet Airways has ventured with Cen-

trumDirect (one of India’s leading financial services groups), to offer Foreign Exchange Services to guests travelling abroad. The clients, or the guests, can avail this facility online by providing the stipulated details on the airline’s website www.jetairways. com. They will be then contacted by

12 | India Newsletter

the authorised representatives from CentrumDirect in order to complete transaction.

• CentrumDirect offers 30 leading world currencies, travellers’ cheques and prepaid travel cards across over 40 cities within India.

• Singapore’s Changi Airport and Switzerland’s Zurich International Airport have expressed interest to carry out the operations and maintenance of the modernised terminal of the Netaji Subhas Chandra Bose International Airport, Kolkata. The Rs 2,300-crore (US$ 423.37 million) new integrated terminal has an annual capacity to handle 20 million passengers. It was jointly developed

by ITD Cementation India Ltd and its parent company Italian-Thai Development Public Co Ltd, Thailand (ITD).

• Hong Kong-based full service airline Cathay Pacific has unveiled its plan to add more direct flights from Mumbai to Hong Kong starting April 2013. The airline will also launch its new product line of the premium economy cabin on this route. Cathay that has India route among the top 10 revenue earners, along with its sister airline Dragonair, flies 46 weekly flights from six ports in India. It recently added Hyderabad in its network with four weekly flights.

• IBS Software has signed a ‘multimillion dollar’ deal with Turkish Airlines for providing software support to its cargo service. The 10-year contract will make the airline have access to IBS’ flagship product for air cargo operations named ‘iCargo’. iCargo supports requirements of airline freight business by providing Web-enabled features that optimise operations, enhance profitability and provide scalability. iCargo will empower Turkish airline’s air cargo movement worldwide and replace the legacy system.

Government Initiatives The Government strives to streamline various policies to promote greater investment and make the Indian aviation industry an integral part of the global aerospace and defence supply chain. India’s acquisition programme and its offset policy is anticipated to generate investments in excess of US$ 20 billion along with creating massive employment for skilled and professional manpower.

The government is also trying to create policies that will enable creation of micro, small and medium enterprises (MSME) clusters with quality infrastructure and building capabilities. There are around 500 MSMEs across different clusters in the aerospace sector, but the clusters are fragmented and yet to evolve.

Recently, the Foreign Investment Promotion Board (FIPB) has cleared Malaysian low-cost carrier (LCC) AirAsia’s proposal to form a budget airline in a joint venture (JV) with the Tatas and Telstra Tradeplace at an initial outlay of Rs 80 crore (US$ 14.73 million). The proposal will head to the Directorate General of Civil Aviation (DGCA) for the necessary license after which the JV can commence its operations.

Once approved, AirAsia India will be the first real action after the government in 2012 allowed foreign airlines to invest in their Indian counterparts.

Meanwhile, India and the US will soon sign an information sharing agreement to strengthen aviation security in both the countries. The agreement, that is yet to be approved by the Cabinet, would cover a large spectrum of civil aviation security wherein Transportation Security Authority of the US would be sharing information in areas including individuals, systems, technology and equipments with India.

Henry Steingass, Regional Director for South and Southeast Asia of US Trade and Development Agency (USTDA), said that the Indian aviation sector continues to hold immense potential for growth.

“India is the founding member of International Civil Aviation Organisation (ICAO) and like the US, plays a key role in implementing important aviation security provisions regionally and globally,” he said.

Industry

Road Ahead

the report from Airports Council Inter-

• Delhi Airports operations contrib-

AK Antony, the Defence Minister, said that the Indian aviation sector is growing at the fastest pace and will evolve into a major hub for aerospace operations and outsourcing in the coming years.

national (ACI), a global body of airports,

uted Rs 294.7 billion to the national GDP & 13.53 per cent to Delhi’s GSDP in 2009-10.

Moreover, the Indian civil aviation sector has continued to witness high passenger growth (domestic traffic compounded annual growth rate [CAGR] is 17 per cent from 2009 to 2011), and if the trend sustains, it could be among the top three aviation markets in the world by 2020, according to ‘Indian Aviation: Spreading its Wings’- a report prepared by PwC with an industry body.The report further states that a strong market growth rate coupled with infrastructure expansion will boost the sector in a big way.

amongst the fastest growing airports in

Delhi Airport: India’s pride Delhi’s Indira Gandhi International (IGI) airport is the second best in the world in the category of airports handling 25-40 million passengers per annum (MPPA) for their service quality for the year 2012. In

Delhi airport was ranked fourth in the ‘Best Airports by Region’ across all categories in the Asia Pacific region. In fact, Delhi Airport is one of the busiest and the Asia Pacific region. Terminal III at the

• In-line Baggage Handling System with 10,800 bags/hour handling capacity

• 12 Baggage Reclaim belt and 168 Check-in counters

Indira Gandhi Airport, opened in 2010, is the eighth largest passenger terminal in the world. Some of the other salient features of the Delhi Airport are as follows:

• One of the largest Green Buildings in the world. ‘LEED India’ Gold Rating from IGBC in 2011.

• Integrated Terminal T3 with 553,887 sqm area that can handle 34 mppa.

• Eight level Passenger Terminal Building (PTB) with 2 piers each 1.2 km long either side.

• Fully operational three runways with a peak hour handling capacity 75 ATM. India Newsletter | 13

Business

sales and professional taxes by state

By Dezan Shira

C

ompanies that sell a product must file annual sales tax or submit their value-

added tax returns. Companies located in states where professional tax registration is mandatory must file annual professional tax returns for each of their employees for whom they have deducted professional tax.

The tables below give some examples of sales tax and professional tax requirements for a selection of states. Companies in the service industry with more than INR1 million in service revenue need to pay service tax by the 5th of the following month (6th for online payments). Service tax returns

must be filed every six months, by October 25 and April 25. Entities with sales revenues over INR10 million or professional fees over INR2.5 million must undertake a tax audit and file the resulting tax audit report before September 30 of the following year.

This article was extracted from Dezan Shira & Associates’s publication entitled “India Briefing�. For further corporate assistance, consider contating 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 Mr. Olaf Griease under olaf.griese@dezshira.com or visit www.dezshira.com

14 | India Newsletter

Interview

It will be wrong for investors to become bearish on India Interview with Geoff Lewis, Executive Director, and Global Market Strategist, at JP Morgan Asset Management

G

eoff Lewis is executive director, global market strategist, at JP Morgan Asset Management, which manages assets worth $1.5 trillion worldwide. Prior to joining JP Morgan in 1999 as head of investment services, he had stints at Dresdner Kleinwort Benson as Asian regional economist and Smith New Court as head of Asian economics. According to Lewis the Indian economy will rebound in FY14, boosted by lower inflation and interest rate cuts from the Reserve Bank of India. In an exclusive interview to ET , he said that this is the right time to buy India, as markets are currently trading at a 10% discount to five-year average, and valuations are only at 2.7 times of price-to-book. Edited excerpts:

markets, as we believe in a bottom-up stockpicking approach. There are many attractive companies whose valuations are currently very cheap, including those in the mid-cap space. At the moment, we are slightly overweight on private sector banks.We don’t like public sector banks, are positive on cement companies, as the demand-supply situation is favourable. We are avoiding defensives and utility companies, as they are expensive.

Currently, we are underweight on technology, though we like some companies in that space. FIIs are buying into India because they think the economy can grow at 6-7% over the medium term.

Q: Further rate cuts have been made incumbent upon moderating inflation by RBI. Given that wholesale prices rose at the slowest pace since 2009, do you think RBI will be more aggressive in cutting rates now?

Q:The 4th quarterly earnings of India Inc so far have been in line with expectations. Are you considering an earnings upgrade?

A: We don’t expect a dramatic reduction in interest rates as we move forward. We have already witnessed a 75 basis point reduction in interest rates so far this year.We think there could be one or more interest rate cut for the entire year. At this point of time one should not expect more than a 50-basis point rate cut. Some temporary factors like easing commodity prices are helping inflation to decline. We believe the rupee will strengthen over the next three to six months, as people are expecting an improvement in the current account and trade deficits. We are long on Indian currency on a three-to-six month basis.We are not positive on commodities, as we believe prices will weaken further.

Q: The Sensex currently trades at 15 times its forward earnings, limiting the room for a further rally from current levels, few fund managers believe. What’s your advise to your clients?

A:We think it would be wrong for investors to become bearish on India. We believe the Indian economy is approaching an inflection point, with GDP growth having bottomed out and corporate earnings having stabilised.

The market lull, therefore, offers a good entry point for investors who wish to increase exposure to India. We expect economic momentum and earnings to improve from current levels.

Q: What is your investment philosophy, and which are the sectors you are currently overweight and why?

A: We don’t take a macro approach to the

A: India was the first country in Asia to see earnings downgrades, and may also be amongst the first to witness improvement.

Earnings revisions for MSCI India in recent months have been flat for 2013, and mildly positive for 2014. The forecasted growth of EPS is around 15% for both 2013 and 2014, which may be on the higher side.We believe India’s potential to grow is much higher than what it has delivered in the recent past.The cyclical problems do not undermine the long-term investment case for India.The policies are improving, and, unlike China, there is a clear need for more investments. We believe the Asian equity portfolios should be overweight India position. The pace of foreign flows into India has slowed down in the past couple of months. We understand developed markets such as US and Japan are attracting larger share of flows.

Q: Do you think money flows into emerging markets, including India, may see a temporary blip?

A:We don’t think it’s an India-specific problem. If you look at emerging market flows, they were positive in January and February, trailed off in March, and have been negative in the last month and a half. It’s a case of global risk appetite, and not an India problem. There is no money flow into emerging markets as for global investors it’s a risk-off for emerging markets, and risk-on for US S&P 500. In the global equity rally, the sectors which have performed well are the defensives, and the high dividend-paying stocks.

There is lack of enthusiasm among investors for general emerging markets. However,Asia ex-Japan has done well than most of the

emerging markets. We have not seen any big fund outflows from India. Foreign institutional investors are It’s not hot money which is coming in, and going out of India, and this is very encouraging.

Q: Many economists believe that the Indian economy has bottomed out, when it comes to macroeconomic indicators. Do you agree that the worst of macro data is behind us?

A: We have witnessed poor macro economic data, where quarterly GDP numbers were below 5%, and consumer price index (CPI) inflation remained sticky. The combination of sluggish growth and high inflation is not auspicious for equity markets. But, we believe the worst of macro woes are behind us, and most of the negative news is largely discounted. In the absence of new shocks, we believe the general direction of the markets should be upwards.

Q: Have you any seen silver lining in the macroeconomic data in the recent past?

A: Supporting our optimism, the latest high frequency data has been encouraging. Industrial production data is improving, with gains in domestic orders and re-stocking. Even the weak GDP numbers last quarter had a silver lining, as the fall in growth was due to a decline in government consumption, reflecting greater efforts by the government to trim fiscal deficit. Private consumption and investments are both showing some signs of improvement, investor attention is mostly focused on capital expenditure. Overall, the indicators are showing that the economy is improving.

Q: General elections are less than a year away. How do foreign investors look at Indian politics?

A: The foreign investors take this view that BJP, when it was in power, was quite businessfriendly, and very reform-oriented, and will be so again.What foreign investors don’t want to see is a hung parliament. When there is no clear ability to form a government, in which case, presumably Congress will have to take lot of regional parties on board again, in that case it tends not to be very effective government. Most foreign investors don’t invest in India on expectation of what the government or politics can do.

They invest because they believe in what the private sector can do. We have to get the elections out of the way, till then the economy may go through a soft patch. looking at India with from a long-term view.

India Newsletter | 15

Trade Shows & Events

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.

16 | India Newsletter

Announcements

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: Tel: +43-1-505866614 Email: thirdsecy@indianembassy.at

LIBRARY The EMBASSY’S library is opened mondays and wednesdays from 11am to 1pm

without appointment. 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 11am to 1pm without appointment. 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

India Newsletter | 17

Tourism

FESTIVALS AND FAIRS Experience India Series

T

he Indian calendar is a long procession of festivals; if you can find yourself in the right place at the right time, it is possible to go through your visit with a festival each day. The harvest festivals of the south, the immersion of Ganesh in Bombay, the car Festival of Puri, snakeboat races in Kerala, Republic Day in Delhi... every region, every religion has something to celebrate. Below is a selection of the major ones, but there are countless others; enquire at local Government of India Tourist Offices for details.

JANUARY / FEBRUARY

Kumbh Mela: The oldest and most important of the Hindu festivals. It takes place every three years, at one of the four great holy cities; Nasik in Maharashtra, Ujjain (MP), Prayag (Allahabad) and Hardwar (both in UP). It is attended by millions of pilgrims who take a holy dip in the sacred Ganges River.

APRIL / MAY Baisakhi: Northern India, West Bengal and Tamil Nadu; Hindu Solar New Year.

Bhangra dancing. Women wear yellow saris.

Sankranti / Pongal: Mainly Tamil Nadu, Andhra Pradesh and Karnataka. 3 days and colourful: Tamil harvest festival.

Pooram:Trichur: New Moon. Spectactular sight of large number of elephantscarrying ceremonial umbrellas going round the temple; midnight fireworks display.

Republic Day: National: establishment of Republic 1950. 26th January. Grand Military Parade and Procession of dancers etc. Delhi.

Id-Ul-Zuha: (Bakrid): Muslim, National: The most celebrated Islamic festival in India, commemorating the sacrifice of Abraham.

Vasant Panchami: National (Mainly in the Eastern region): Hindu – dedicated to Saraswati the beautiful Goddess of Learning. Women wear yellow saris.

Floating Festival: Madurai: Birthday of local 17th century ruler; elaborately illuminated barge carrying decorated temple deities at the Mariamman Teppakulam Pool amids chanting hymns.

Id-Ul-Fitr(Ramzan Id): Muslim, National: Celebration to mark the end of the month of Ramadan.

FEBRUARY / MARCH Shivaratri: National: Solemn worship of Hindu deity, Lord Shiva. Fasting and chanting. Special celebrations at Chidambarum, Kalahasti, Khajuraho, Varanasi and Bombay.

Holi: Mainly northern, popularly called the festival of colors. Advent of Spring.

Lively and much throwing of coloured water and powders. Public Holiday.

Mardi Gras: Goa: Mainly three days during lent. Unique celebrations at this carnival.

Ramnavami: National: Birth of Rama, incarnation of Vishnu. No processions.

Plays and folk theaters.

Mahavir Jayanti: National:Jain festival; birth of Mahavira, the 24th and last Tirthankara.

Meenakshi Kalyanam: Madurai. Marriage of Meenakshi with Lord Shiva. Colourful temple festival. Deities borne by colossal chariot. Ten day festival.

Urs Ajmer Sharif: Ajmer, 6 days. Religious cultural and commercial extravaganza dedicated to the Sufi. Music; no procession.

JUNE / JULY Rath Yatra: Mainly Orissa. Greatest temple festival in honour of Lord Jagannath (Lord of the Universe). Three colossal chariots drawn from Puri temple by thousands of pilgrims. Similar festivals, on a smaller scale, take place at Ramnagar (near Varanasi), Serampore (near Calcutta) and Jagannathpur (near Ranchi).

JULY / AUGUST Teej: Rajasthan- Particularly Jaipur: Procession of the Goddess Parvati to welcome monsoon; elephants, camels, dancers etc. Women wear green saris.

Colourful.

Easter: Good Friday / Easter Sunday National.

Raksha Bandhan: Northern and Western India. Legendary reenactment, girls tie rakhis or talismen to men’s wrists.

Colourful build up.

MARCH / APRIL

Naag Panchami: Mainly Jodphur, Ra-

18 | India Newsletter

jasthan and Maharashtra. Dedicated to the green thousand-headed mythical serpent called Sesha. The day is also observed in many other parts of Western and Eastern India.

Amarnath Yatra: Hindu: Lidder Valley, Kashmir at full moon. Pilgrims visit the place where Lord Shiva explained the secret of salvation to his consort Parvati.

AUGUST / SEPTEMBER Independence Day: (15th August). National: Independence Day. Prime Minister delivers address from Delhi’s Red Fort.

Janmashtami: National, particularly Agra, Bombay and Mathura; Lord Krishna’s birthday.

Onam: Kerala’s Harvest Festival; spectacular snake boat races in many parts of Kerala.

Ganesh Chaturthi: Mainly Pune, Orissa, Bombay, Madras, dedicated to elephantheaded God Ganesh. Giant models of the deity processed and immersed in water.

Colourful, and a particularly worth visiting on the Day of immersion at Bombay.

SEPTEMBER / OCTOBER Dussehra: National: The most popular festival in the country, celebrated in different ways in different parts of the country. In the north and particularly in Delhi (where it is known as Ram Lila), plays and music recall the life of Rama; in Kulu, the festival is also very colourful celebrated.

In Bengal and many parts of Eastern India it is known as Durga Puja, and in the South as Navaratri.

Gandhi Jayanti: National: Mahatma Gandhi’s birthday. No processions.

Diwali: National: One of the most lively and colourful festivals in India. In some parts, it marks the start of the Hindu New Year. In Eastern India, the goddess Kali is particularly worshipped; elsewhere, it is Lakshmi, the goddess of prosperity, who is venerated. Everywhere there are magnificent illuminations and fireworks.

Gurpurab: Mainly in northern India. Anniversaries of ten gurus, spiritual teachers or preceptors of Sikhism. No procession.

Tourism NOVEMBER

DECEMBER

Muharram: Muslim. Commemoration of Imam Hussain’s martyrdom. Tiger dancers lead processions of colourful replicas of martyr’s tomb. Colourful, particularly at Lucknow.

Christmas Day: National: Most exuberantly celebrated in Goa, Bombay and Tamil Nadu.

Bihar: Largest cattle fair in the world; 1 month Sonepur, Patna; on banks of the Ganges.

Pushkar Mela: Pushkar, near Ajmer, Rajasthan. Important and colourful. Camel and cattle fair, attended by Rajputs from miles around. Camel races and acrobatics etc.

Note: Besides the above festivals there are hundreds of festivals and fairs which are of regional significance, celebrated with equal pomp and colour. The most authentic of these are the following: (1) The Temple Festival in South India, a list of which is available at India Tourist Offices, (2) The many festivals at Ladakh in Kashmir.

(3) The many festivals in Rajasthan at a time when a festival of some kind is not either in Progress or about to take place.

FOR MORE INFORMATION ON INDIA TOURISM:

India Tourism Baseler Str. 48 60329 Frankfurt Tel: +49 (69) 242949-0 Fax: +49 (69) 242949-77 www.india-tourism.com info@india-tourism.com

India Newsletter | 19

India in Austria

INDIAN MOVIE EVENING: LAGAAN - Es war einmal in Indien

Friday, June 28th, 18:00 | Indian Embassy Business Centre (1st Floor, Kärntner Ring 2, 1010 Vienna) 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 or via phone at +43 1 505 866633 (Ms. Lily John).

Genre: Drama / Adventure Directed by: Ashutosh Gowariker Starring: Aamir Khan, Gracy Singh, Rachel Shelley Released: 2001 Duration: 224 Minutes Language: Hindi Subtitles: German Image Quality: Standard

BOLLYWOOD MOVIES IN AUSTRIA

At the UCI KINOWELT Millennium City (Wehlistr. 66,1200 Vienna)

Synopsis:This is the story about the resilience shown by the Indians when they were under the British Rule.They are already taxed to the bone by the British and their cronies, but when Jack Russell announces that he will double the Lagaan (tax) from all villagers, they decide to oppose it. Leading the villagers is a handsome young man named Bhuvan, who challenges them to a game of cricket, a game that is to be played by veteran British cricket players, versus villagers, including Bhuvan himself, who have never played this game before, and do not even know a bat from a piece of wood.As the challenge is accepted, the interest grows and attracts Indians from all over the region, as well as the British from all over the country - as everyone gathers to see the ‘fair play’ that the British will display against their counter-parts, who are aided by none other than the sister, Elizabeth, of Captain Rusell.

Conference Yoga in Transformation: Historical and Contemporary Perspectives on a Global Phenomenon September 19–21, 2013 University of Vienna, Austria

For more information, showtimes, reservations and tickets:

www.uci-kinowelt.at/ Millennium_City CURRENTLY SHOWING111

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Contact: Alexandra Böckle Department of South Asian, Tibetan and Buddhist Studies alexandra.boeckle@univie. ac.at OR +43-1-4277-43501 The final program and the conference website will be available soon.

India in Austria

EXHIBITION: “IM BANN INDIENS�

Starting July 6th, 18:00 | Atelier Bilder, Rahmen, Spiegel (Zimmermanngasse 8, 1090 Wien) If you are looking for astonishing Indian Art in Austria then come to the inaugural exhibition of the Austrian-Indian Society of Arts and Cultural Exchange on the 6th of July. The Society aims to promote Indian Art, Culture and Artists in Austria and help to strengthen bonds between the Austrian public and Indian Art and Culture. India has an amazingly rich cultural heritage and up to this day creates fine arts based on its amazing diversity of

talents and cultural background.

Recently the society has launched their first artist Sisir Datta (a well renowned and awarded Indian artist based in Delhi) and Abhishek Hajela (freelance photographer who recently won Nikon World Photography Award in the Emerging Talent Category). You will see pieces of both artists at the exhibition alongside artworks of the Vienna based artist and designer Sonal Nathwani. Expect an

amazing evening with Indian culture, indulge in Indian cuisine delights and listen to amazing classical pieces. A sneak preview of some of the masterpieces can be viewed under the society website - www. jpdgallery.com.

They are also constantly looking to get in touch with promising Artists and welcome collaborations with different Indian associations, individuals and institutions.

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India in Austria

OTHER EVENTS More Information below

More information under

www.schallaburg.at 22 | India Newsletter