Enterprise and Economic Update Kerala

■ Muziris, next big tourism product ■ Art business is back

Price `50 $5

■ Anna group, the brand builders ■ SCMS biotech picks up steam

Volume 1 Issue 2 March 2011

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Vol.1 Issue 2 March 2011

RNI No. KERENG02297

Editor K J Jacob Copy Editor Anna Mathews Principal Correspondents Aby Abraham G K A P Jayadevan Correspondent Kuruvilla Chacko Sub-Editor Asha Jacob Design and Layout Renu Arun Website Suhas K Ranju Thomas Sales and Marketing Jose Thomas Edited and published by K J Jacob from Independent Media XI/173 B, Mulakkampillil Buildings, Kunnumpuram-Civil Station Road, Thrikkakkara, Kochi-682021 Kerala, INDIA Telefax: +91 484 2421916 Printed at Maptho Printings Near TVS Junction, South Kalamassery, Ernakulam-683 104 Tel: +91 484 2558 333 Subscription, advertisement sales@economic-update.in +91 97444 17980 We value your feedback.

Please write to us at: letters@economic-update.in Read us at www.economic-update.in Cover design : Anoop Radhakrishnan

Green pastures

T

here is a party today, declared Kuruvilla Chacko, my colleague, entering the office one morning. “I am richer by `5,000.” The bounty was his share from the proceeds of paddy harvested from his family farm, he explained.

I have known that he hails from Kuttanad, the rice bowl of Kerala. But I have never heard him, an electrical engineer by training, talk of farming with such excitement. The exuberance was because it was the first time that the harvest was so remunerative that he was invited to partake in the profit, he explained. Kuruvilla also told us that some of his relatives have reaped a rich harvest and spent the money on refurbishing their ancestral homes.

The offer of a party is a reason for us to celebrate, but we smelt a story, which we as a newspaper and Kerala as a society, must cheer. For, we mostly hear stories of despair from farms. Rising inputs costs, scarcity of labour, unremunerative prices and poor marketing avenues… farmers found it easier to lay the land barren than to farm. Many migrated to cities in search of jobs.

We chose to examine the leads. I called up Fr Thomas Peeliyanikkal, president of Kuttanad Vikasana Samithi, an NGO spearheading the cause of the farmers. He also agreed to what Kuruvilla had said. “Yes, there is some good news from the field, though there are still a lot of unsolved problems.” There are people, who once left farming altogether, now lease land from their relatives or friends for farming. He also shared a very valuable piece of information: though there is no legal backing for leased farming, banks have come up with an imaginative plan to give loans for such farmers at very low interest rates.

The plot thickens, we felt, and we did not wait.

We left for Kuttanad.

Kuruvilla was right, as you will find in the cover story.

I am sure that the eyebrows, which would have risen if a magazine on enterprise and economy chose to have a farming story on its cover two years ago, won’t do so now. Inflation and its impact on the economy, gives us more than enough reason to be realistic about the claims of the performance of our economy.

We have a genuine reason to party now.

Editor

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Contents COVER STORY

24 Jai kisan

Jai machine The once dying rice bowls of Kerala are now back in the thick of action.

Non-availability of labourers, which almost terminated paddy farming as a respectable and profitable vocation, has a remedy in the form of a blade that sits on the harveting machine.

Today, farmers vie with one another to take fallow lands on lease and cultivate paddy.

40 Riches on canvas Appreciation for art in Kerala; both in the interest shown by collectors and in money terms

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Contents 20 PROFILE/M C Jacob A unique brand M C Jacob, founder of Anna Group, bags the Kerala government’s first Lifetime Achievement Award.

Having started business in a nascent sector with strong unions, the septuagenarian is an encyclopedia of entrepreneurship and brand creation

22 Stitch in time Women in Cheruvannoor set up footwear stitching units and turn vendors to big brands 34 Once upon a time in Kerala tourism breathes new life into the ancient port of Muziris

Kerala

38 Well covered Tensile fabrics are in trend for roofing applications 44 A filmi gamble Christian Brothers launches a new style of marketing by releasing on 300 screens 48 Recreating health SIBB-R&D, Kerala’s sole private BT research facility, takes great strides in health sector 52 Link up with ULIPs New-look ULIPs are a lot more transparent than its earlier avatars 54 SIP by sip Systematic Investment Plans are the preferred means of investing in equities for the masses

30 Healthy hospital The Ernakulam General Hospital is Kerala’s first government hospital to bag the NABH certification

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THE BIG PICTURE

Kerala will have its second International Container Transshipment Terminal at Vizhinjam, 16 km from Thiruvavanthapuram.

Just 10 nautical miles off the main international sea routes, Vizhinjam is one of the oldest natural ports in India with a draft of 24 metres.

The State government has set up Vizhinjam International Seaport Ltd (VISL), a special purpose vehicle, for the `4,500 crore project.

The State government has recently signed three MoUs with agencies for taking the project forward. They are the State Bank of Travancore (for sourcing long-term finance of `2,500 crore), the Kerala State Electricity Board (for supplying power to the project area) and Rail Vikas Nigam Ltd for provision of a rail link.

The State budget for 2011-2012 has earmarked `150 crore for the first phase of the project.

At present a serene fishing village, Vizhinjam will transform itself into one of the busiest ports in India once the project is materialised.

The project, along with the recently commissioned Vallarpadam International Container Transshipment Terminal, is expected to play a crucial role in the container cargo movement in South Asia.

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LETTERS

Keep it up!

I am happy to see a wonderful publication from our home State. Both the content and the presentation in the magazine are good. The designer has done a commendable job.

U Suresh Member, Kerala Public service Commission By e-mail Valuable Information I run an education company in Chennai. We are basically into content based education and interactive classrooms. Your article on the education trends in Tamil Nadu was really spot on. I have been closely watching the rise of Tamil Nadu as far as education is concerned. The State has learned to accept technology along with education and have moved beyond just ‘black board and chalk’ class rooms. The article with its thorough statistics provided me deep insight into the education trends in rural areas which I really wanted to research on.

Abraham Philip Chennai by e-mail

stands recently gives me confidence.

The cover story made me realise that Kerala, like any other place, can be an investor’s paradise. I am awaiting more investor-based stories in the coming issues as well.

Cherry Antony Mumbai by e-mail

From the heart As a well wisher of the State, I was pleased to see a publication focusing on emerging economies in rural Kerala. The story on Elapully panchayat was a tale from the heart, and hence, inspiring. I am happy that people there believe in a ‘White Revolution’ of their own. I wish this magazine the best of luck and hope more such stories come out.

C Unni Kochi by e-mail

Inspiring editorial I found the editorial very inspiring.

There is a clear focus on your part on depicting the good side of the State, while everyone else continues putting it down. Hope you keep it that way and make Malayalees see their State in a different way. Kudos to the cover designer. The depiction of a young elephant signified the rise of Kerala investors. The news inside was good too, complementing the designs. One suggestion would be to include more guest columns which I believe will give more value to the product Santosh G Thiruvananthapuram by e-mail

Kerala beckons I resigned my job at a mining company in north India recently and am planning to check out my home State to start an enterprise.

The magazine which picked up the

Sleep well I thoroughly enjoyed reading the article on sleep. It is a fact that many of us consider sleep as the easily expendable item on the day’s agenda. It is in fact equal to

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torturing our own body, which helps us go about doing our job.

Remember, Amnesty International lists sleep deprivation as a form of torture! The body may not recognise whether it was imposed by an enemy within or without.

Sam Manuel Kochi by e-mail Personal finance Reports on personal finance were informative. Though we have a lot of news magazines specialising in it, only few dare to give the reader the correct information. It was for the first time I was reading an article on term insurance which highlights its advantages. I can now interact with my insurance agent with more confidence!

Vivek M Nambiar Kozhikode by e-mail For a green country I have often wondered how is it that we, a green country, are so callous about our environment.

I have noticed that we have no qualms about polluting even water bodies. In this context, the noble endeavour of IMA in setting up a waste treatment plant must be appreciated. That single plant has saved several of our rivers and lakes from contamination.

Anoop M P Alappuzha by e-mail Field reports All your reports are from the field, rather than discussions, and hence I am sure the magazine will easily find its segment of followers despite being a bit costly. After all, premium information which is rare, comes at a price. I enjoyed the stories and expect the works to keep getting better with each issue.

Jane Thomas Thrissur by-email

I say!

I deployed my company’s financial professionals to make a realistic cost-benefit analysis and presented it before the SmartCity decision-makers.

They were convinced that the project would be profitable in the long run even without having the right to sell the freehold land M A Yusuf Ali, who negotiated with Tecom on Kochi Smart City on behalf of government of Kerala

Anoop Radhakrishnan

We have a large number of persons who think themselves to be the law. Law must catch them.

Merely their being in the list of Forbes or millionaires does not make a difference

The Supreme Court bench monitoring the 2G spectrum scam

It is amazing how Mahatma Gandhi brought together the landless farmers of Champaran, the textile workers of Kanpur and Ahmedabad and the business leaders of Mumbai and wove their aspirations for a common cause

Mukesh Ambani on bringing the two Indias together at FICCI’s 83rd Annual General Meeting

The best brains of the world work for the rich. We need talent to work for the poor

Sam Pitroda inaugurating the KMA Management Convention

The State economy grew at around 9 per cent in spite of the pressure of global recession and the hangover of the agrarian collapse. Sir, I am assuring you, Kerala would be the fastest growing State in the country within two or three years

Kerala Finance Minister Thomas Issac in his budget speech

I seek the blessings of Lord Indra to bestow on us timely and bountiful monsoons, I would pray to Goddess Lakshmi as well. I think it is a good strategy to diversify one’s risks

Finance Minister Pranab Mukerjee in his budget speech 9

AT A GLANCE

China is second-largest economy: China has

eclipsed Japan to become the world’s second-largest economy. According to Japanese data, China’s nominal GDP was $5.8786 trillion against Japan’s $5.4742 trillion.

However, the per capita income of China is one fifth that of Japan, owing to the difference in the size of the population.

China overtook Germany to become the world’s third largest economy four years ago. It now has its sights on the US, which it could eclipse as the world's largest economy between 2020 and 2030.

Hu is most powerful: Chinese President Hu Jintao has topped the list of world’s most powerful persons while UPA chairperson and Congress president Sonia Gandhi has been ranked ninth by the Forbes magazine.

US President Barack Obama, who last year topped the list, has been placed second behind Hu while Saudi King Abdullah stands the third most powerful man in the world. Prime Minister Manmohan Singh has been ranked 18th on the list. Russian Prime 10

Minister Vladimir Putin holds the fourth place and Pope Benedict XVI has been placed fifth, while German Chancellor is at sixth place. Reliance Industries CMD Mukesh Ambani and NRI industrialist Lakshmi Mittal are ranked 34th and 44th respectively on the list.

Food inflation worsens poverty: Sharp increases in the price of staple foods over the past six months have pushed as many as 44 million people into poverty, according to a new Food Price Watch report from the World Bank. The World Bank’s food price index rose by 15 per cent between October 2010 and January 2011, according to the report, and now is 29 per cent higher than one year earlier. The current index is just 3 points below the peak in June 2008. The report notes that the increase over the last quarter is largely due to increases in the price of sugar, fats and oils, wheat and corn.

IPv4 gives way to IPv6:

IPv6, a system that will offer far more numerical addresses and simplify address assignments and provide additional network security features, is set to replace IPv4. This is because the last blocks of IPv4 Internet addresses have been allocated and the technology that has powered Internet Protocol addresses since the Internet’s inception will soon be exhausted. The transition from IPv4 to IPv6 is likely to be rough, though.

IPv4 uses 32 bits for its Internet addresses. That means it can support 232 IP addresses in total. IPv6 utilises 128-bit Internet addresses. Therefore, it can support 2128 Internet addresses - so many that it requires a hexadecimal system to display the addresses.

Fed forecasts faster growth: The US Federal Reserve has upgraded its growth forecasts for this year, though it expects unemployment to remain painfully high for some more time. The Fed now expects the output of goods and services to grow by 3.4 to 3.9 per cent this year, up from the November forecast of 3 to 3.6 per cent. But the outlook for the job market was largely unchanged at

8.8 to 9 per cent unemployment this year.

Nokia, Microsoft tie up: The Finnish mobilephone company Nokia has announced “a broad strategic partnership” with Microsoft. Nokia, which lost ground to Apple and Google in the smartphone market, is adopting Windows Phone as its primary platform for smart devices, displacing its own Symbian software. Eric Schmidt, Google’s boss, revealed that his company had talked extensively to Nokia about adopting Google’s Android platform.

Apple iPad 2 hits market: Human appetite for

hitech gadgets never gets satiated. Thousands of people thronged Apple stores in United States as the iPad 2 went on sale.

Many of them queued up overnight forming pre-sale lines before the sale opened.The crowd erupted as a sea of blueshirted Apple staff threw open the doors and gave high-fives to the first eager iPad shoppers in Manhattan. Wall Street anticipates a strong start to the iPad 2, on par with the original, though some analysts were more bullish. It is priced between $499 and $699.

AT A GLANCE

Now, Everywhere Teller Machine: Axis Bank has

launched Everywhere Teller Machine (ETM) service in Vijayawada, Andhra Pradesh. Debitcard holders in the city can now withdraw up to `1,000 per day from point-of-sale terminals at select merchant outlets using Axis Bank EDC machines. The facility would ease the process of withdrawing cash for the customers when an ATM facility was not available in the vicinity of the stores. The service would be rolled out in Maharashtra, Tamil Nadu, Karnataka, Kerala and Gujarat this financial year.

India, Malaysia open markets: India and Malaysia signed a Comprehensive Economic Cooperation Agreement (CECA) that envisages liberal trade in goods and services. Under the agreement, both sides offer ‘Asean plus’ market access in goods. India will get market access for goods including fruits such as mangoes, banana and guava, basmati rice, two wheelers and cotton garments.

Both sides agreed on providing access to each others’ services market across all modes and various sectors. India and Malaysia would liberalise their respective investment regimes to facilitate greater Foreign Direct Investment into each other’s

territory. The CECA would come into effect on July 1, 2011.

New series of consumer price inflation: The government has launched the new series of consumer price inflation for rural, urban and combined (rural + urban). Unlike other consumer inflation series, the base for the new series of consumer

Union Territories.

India, Japan sign free trade agreement: Japan and India signed a bilateral free trade agreement that would abolish duties on more than 90 per cent of trade for 10 years. The deal would eliminate tariffs on 90 per cent of Japanese exports to India, such as auto parts and electric appliances, and

Cash transfer on anvil The Gross Domestic Product of India grew 8.9 per cent and touched `48,79,232 crore in financial year 2010-2011, according to the Union Budget for the financial year 2011-12 presented

by Finance Minister Pranab Mukherjee on February 28, 2011. The gross tax receipts for the next financial year is estimated to be `9,32,440 crore, up 25 per cent. The fiscal

deficit is pegged at 5.1 per cent of GDP as per the revised estimates for 2010-11. The budget proposed that Direct Taxes Code be implemented in April 2012.

The landmark suggestion in the budget was the declaration of the government’s intent to move towards direct transfer of cash subsidy to people living below poverty line for better delivery of kerosene, LPG and fertiliser subsidies.

price inflation will be January-December 2010.

This is aimed at gauging the exact impact of price rise on the common man.

These consumer indices will be available for five major groups — food, beverages and tobacco; fuel and light; housing; clothing, bedding and footwear; and miscellaneous. The indices will be released for all States/

97 per cent of imports from India, including agricultural and fisheries products, until 2021, the Japanese government said.

Japan and India are also to continue talks on lifting employment restrictions to allow Indians to work in Japan as nurses and care givers. Japan, which is bracing itself for increasing health care requirements as its population

ages, hopes to conclude the talks within two years, the government said.

FDI dips 22 per cent:

Foreign direct investment (FDI) in India declined 22 per cent from $27 billion (`130,980 crore) in 2009 to $ 21 billion (Rs 96,104 crore) in 2010, a latest industry ministry data said. Foreign investors are cautious due to the fragile global economic recovery.

The main sectors that attracted FDI include services (financial and non-financial), telecommunications, housing and real estate, construction activities and power, the data said. Mauritius, Singapore, the US, UK, Netherlands, Japan, Germany and UAE are the major investors in India.

Polluters pay: The Planning Commission has pitched for a cess on polluting energy sources like petrol and diesel to cross subsidise the clean energy initiatives in the country.

Deputy Chairman of Planning Commission, Mr Montek Singh Ahluwlia told a conference on Climate Change that in the absence of such cess on polluting energy, the clean energy initiatives in the country would have to be dependent on government subsidy.

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AT A GLANCE

Awards galore for Kerala Tourism: Kerala Tourism

bagged an unprecedented four awards at the Pacific Asia Travel Association (PATA) Awards 2011.

Kerala Tourism picked up one of the four PATA Grand honours and three of the 22 PATA Gold awards, the maximum that any entity has received.

Its ‘responsible tourism’ efforts in Kumarakom won the Grand award in the environment category, while its new global campaign film ‘Your Moment is Waiting’ bagged three gold awards. Kerala resort chain CGH Earth won the PATA Gold award in the Corporate Environmental Programme category for best ecofriendly practices, taking the awards tally for Kerala to five. Kerala, is the only Indian State to figure in the PATA awards this year.

Thiruvananthapuram airport gets new terminal: Prime Minister Manmohan Singh inaugurated the new international terminal of the Thiruvananthapuram Airport on February 12. Speaking at the function, the Prime Minister said the aviation sector had witnessed an unprecedented growth in the recent past and an exponential growth 12

in passenger traffic is expected in this decade.

Civil Aviation Minister Vayalar Ravi said only international flights would be operated from the new terminal. A new domestic terminal would be constructed once sufficient land was received. The

at rejuvenating the State’s ancient trade links with Europe, has obtained the UNESCO heritage label recognition.

The government will soon initiate talks with European countries keen to finalise the terms and conditions for opening

Budget designs `40,000-crore roads project The budget for the financial year 2011-12, presented by Finance Minister Dr Thomas Issac on February 10, 2011, proposes a `40,000 crore Comprehensive Road Restoration Plan to modernise the roads in the State.

The Road Fund Board and Roads and Bridges Corporation would raise the required funds from the market.

Under this scheme, 10 State highways of 320 km and 36 district roads of 765 km will be restored.

The budget puts the net State Domestic Product (at constant prices 200405) at `1,59,143.62 crore, which grew 9.89 per cent during the previous fiscal.

The State expects a revenue income of `38,546.89

crore, up from `32,127.01 crore for the current year.

Of this, `5,488.56 crore is the share of Central Taxes, `3,885.86 crore is grant from the Centre, `26,641.53 crore is receipts from State taxes and duties and `2530.94 crore is the States’ own non-tax revenue.

On the expenditure side, the total estimate is for `44,566.33 crore which includes developmental purposes (`25,716.35 crore), servicing the debt (`6254.56 crore), administrative services (`3,686.24 crore) and for collection of taxes and duties (`921.12 crore). The budget estimates a revenue deficit of `6,019.44 crore and fiscal deficit of `10,640.95 crore.

engineering hangar of Air India will also be commissioned soon, he said.

the route.

Heritage label for Spices Route: The ‘Spices Route’ project of the State, aimed

Infosys’ new campus: Chief Minister V S Achuthanandan inaugurated the first software development block

on the new campus of Infosys Technologies at Technopark, Thiruvananthapuram. S Gopalakrishnan, Chief Executive Officer and Managing Director, Infosys, said the availability of quality manpower has been an impetus for the company to expand operations in the State. The second building of the campus is expected to be completed in May. Spices Park launched: Giving a thrust to valueaddition of spices, a spices processing and storage park with special focus on cardamom and pepper was opened at Puttadi in Idukki district.

The park, set up on a 7.5 acre-campus at a cost of `27 crore by the Spices Board, has world class storage houses, black pepper processing plant, white pepper production unit, laboratories for testing physical parameters, electronic auction centre and cleaning and grading plants for pepper and cardamom.

It also has cardamom colour sorting machines, pepper cleaning, destoning and grading plant, pepper crushing and powdering plant, pepper packing unit and steam sterilisation unit.

NEWS

A portable future Vallarpadam ICTT will change Kerala’s industrial and economic profile

W

hen the Panama flag vessel, OEL Dubai, berthed at the newly-launched International Container Transshipment Terminal (ICTT) at Vallarpadam, Kerala added a unique chapter to its economic and industrial profile.

The ICTT, inaugurated by Prime Minister Dr Manmohan Singh on February 11, 2011, is the first portbased Special Economic Zone in the country. With the commissioning of the project, Kerala became the first State in India to host an ICTT. The first phase of the ICTT was completed at a cost of `3,250 crore.

The Central government contributed `1,650 crore and Dubai Port World (DPW), the developer and operator, `1,600 crore. It has a capacity of 1 million TEUs and consists of 600 metres of quay, six super post-Panamax quay cranes and an on-dock railhead serviced by rail-mounted gantry cranes.

The terminal has been developed on a build-operate-transfer (BOT) basis.

The BOT agreement is for 30 years with a gross revenue share of 33.3 per cent going to the Cochin Port Trust.

The project is expected to help the port city, frequented by traders from all parts of the world in the past, to regain its lost glory. Its all weather port is a natural gateway to the industrial and agricultural produce markets of south-west India. It offers strategic proximity to two international shipping routes–the Persian Gulf to Singapore/Far East channel, just 11 nautical miles away, and the Suez to Singapore/Far East channel, 76 nautical miles away. These advantages are expected to transform the ICTT into a transshipment hub. Feeder ships from nearby ports will bring cargo to the port for transshipment to mother ships, which will take them to destinations all over the world.

Currently, India depends on for-

Prime Minister Dr Manmohan Singh inaugurates the International Container Transshipment Terminal (ICTT) at Vallarpadam on February 11, 2011 eign ports like Colombo, Dubai and Singapore for transshipment. About 60 per cent of India’s exports and imports containers are transshipped through them. The ICTT is expected to bring down the cost of freight of a container by $300-$400 and the transshipment time by 7-10 days, saving the country `700 crore a year in transshipment charges.

A 17.2 km long four-lane road connecting Vallarpadam with Kalamassery has been built to provide road access to the project. An 8.86-km rail link between Vallarpadam and Edapally has also been established.

A double ended ferry, capable of

ICTT is expected to bring down the cost of freight of a container by $300-$400 and the transshipment time by 7-10 days

carrying 22 trucks with containers of 20 feet at a time, has started service between the Roll on – Roll off (RORO) terminals set up in Bolghatty and Willingdon Island. Consignments from the southern region, can now choose the waterways over the city roads, reducing the transportation cost and time.

The approach channel and berth basin of ICTT is being deepened to provide a draft of 14.5m allowing large vessels to berth at the terminal.

The ICTT will throw open many new avenues for entrepreneurs. Logistic service providers will be among the main beneficiaries. Container Freight Stations which shift many activities outside the port and decongest it are required in the vicinity of the ICTT and its feeder ports.

In the next phase, the capacity of the ICTT will be expanded to 3 million TEUs a year. A total 1.8 km of quay and 16 quay cranes capable of handling the largest vessels afloat, with associated yard-handling equipment is being planned.

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News

Smart Moves

SmartCity will put Kerala on the radar of global IT giants

Abdullatif AlMulla, CEO of Tecom Investments, and K Suresh Kumar, Secretary, IT, Government of Kerala, sign the new lease agreement for the Smart City project in Kochi as Smart City chairman and Minister for Fisheries S Sharma and prominent NRI businessman M A Yusuf Ali look on.

S

martCity, the most discussed foreign direct investment proposal in Kerala, has cleared the last hurdle when Abdullatif AlMulla, CEO of Tecom Investments, and Mr K Suresh Kumar, Secretary, IT, signed the new agreement on February 23.

SmartCity is a joint venture between Tecom Investments and Sama Dubai, members of Dubai Holdings Limited, the investment arm of the Dubai government. It aims at developing and managing a chain of selfsustained knowledge-based townships across the world, modelled on Dubai Internet City, Dubai Media City and Dubai Knowledge Village.

SmartCity Malta and SmartCity Kochi are its first projects. It will provide an environment with plug and play facilities and supporting infrastructure to knowledge based industries.

SmartCity Kochi is being developed by Smart City (Kochi) Infrastructures Limited, a special purpose vehicle set up for the purpose. The government of Kerala has 16 per cent equity in the Special Purpose Vehicle, while Tecom and its affiliates hold 14

the rest. The director board will have 10 members, of which two directors will be nominees of the Kerala government. The Chairman will also be a government nominee.

The project was initiated in 2004, when Mr A K Antony was the Chief Minister. The next Chief Minister Mr Oommen Chandy took the project forward and signed the memorandum of understanding with Tecom in 2005.

An updated framework agreement was then signed in May 2007, a year after the new Left Democratic Front government came to power. The new agreement solves the dispute between

The new agreement solves the dispute between the government and Tecom over the right to sell the free-hold land envisaged in the project

the government and Tecom over the right to sell the free-hold land, envisaged in the project, which came to 12 per cent of the total land.

As per the new agreement, the 12 per cent free-hold land coming to 29.5 of the total 246 acres will be within the SEZ and shall not be alienable, and can only be leased. The rest of the 246 acres of land will be given on lease for 99 years, extendable if both the parties agree.

The master plan for the project is expected to be completed soon. The freehold will be transferred to the company on preparation of the plan.

SmartCity Kochi, when complete, is expected to be one of the largest IT parks in the country. The project is located in the Kakkanad and Putencruz villages in Ernakulam district. It is expected to have 8.8 lakh sq ft of built up space with a minimum of 6.2 lakh sq ft (70 per cent of the total) set aside for IT/ITES/allied services.

SmartCity Kochi will offer stateof-the-art business infrastructure and a host of business support services.

It will have a self-contained campus with residential, educational, hospitality, retail and recreational facilities.

The central government has granted SEZ status for 131.41 acres of land in the project. The land for the project is separated by a river – the Kadamprayar - and hence two separate SEZs are required for the project. The SEZ status for the remaining portion of land of 114.59 acres is expected soon.

The work on the project is will commence after the approval is received.

The SmartCity project is expected to change the State's investment profile, and bring global IT firms to the State which already boasts of marquee names of the Indian IT industry. It brings a number of opportunities to investors, businessmen and job seekers here. The project is expected to generate over 90,000 jobs and transform the lives of people in Kerala.

News

The Kochi hub Vyttila Mobility Hub could relieve traffic woes

F

rom a current average peak hour speed of 16 km/hr, Kochi could soon see a brisker pace of traffic. For, buses considered the cause of most of the traffic problems in the city, will have a home away from the heart of the city, thanks to the Vyttila Mobility Hub (VMH).

The hub is conceived as a focal point for road, rail, sky and water transport systems. Says Dr M Beena, Managing Director of the VMH Society, “The city needed a common transit point away from the rush of its interiors. The mobility hub will provide long distance buses plying during peak traffic hours an alternate pick up and drop point outside the city limits.”

The work on the `265 crore project, undertaken by Hyderabad-based Nagarjuna Constructions Ltd and project consultants KITCO, started in December 2010. It comes under the purview of the JNNURM and will be implemented in three phases.

The first phase, completed and inaugurated in mid-February, focused on shifting the halt stations of the Vytilla-Vytilla circular buses and some long-distance buses out of the main city. The second phase will see the construction of the main terminal, the bus repair yard and a mega

parking area for cars and autorickshaws. The final phase will integrate the National Waterway III with the hub. Boat jetties are being proposed to connect the hub to Thrissur and Kollam, and there is a proposal to develop a railway station at Vyttila.

The hub is also being planned as a retail and hospitality centre with a mall, rest rooms and eateries to cater to the 40,000 odd daily travellers.

A study by KITCO found that the 3,500-odd city, long distance and inter-State buses, despite comprising only 14 per cent of the vehicles on road, were the main reason for the slow traffic pattern in the city.

The hub will provide long distance buses an alternate pick up and drop point outside the city limits, says Dr Beena

Also, the city has no space for transport infrastructure development and has to either develop its transportation facilities vertically or move them outside the main city limits. Hence, the urgent need for a mobility hub, keeping in mind a ten-year City Development Model, to cater to 7,000 daily trips. Once fully functional, KITCO Consultants estimate the project to provide returns of `340 crore and enable the KSRTC to save `1.76 crore and city buses `1.16 crore on diesel consumption per annum.

Says Mr. P Ganesh, former Chairman, CII Kerala State Council, “Apart from huge fuel savings, traders from the suburbs and rural areas adjacent to the city can reach the city easily once the waterways get readied.”

A major bottleneck which needs to be addressed to ensure proper utilisation of this project remains the decongestion of the Vyttila junction.

Says Mr K S Baby Vinod, Assistant Commissioner of Police (Traffic), “We will be diverting buses to the hub through the underpass at Vyttila ROB.” But an official of KITCO insists only a planned solution like a flyover over the Vyttila junction will solve the problem.

The mobility hub has the potential to solve Kochi city’s traffic problems to a large extent, through scientific public space management and alternatives such as travel avoidance apart from reducing pollution and accidents caused by slow traffic in the city.

15

Score card

Infopark to build BPO complex

Work on the first IT/BPO park in the recently launched Phase II of Infopark Kochi has started.

Infopark Phase-II, will come up on 160 acres with state-of-the-art facilities including shopping arcades, a town plaza, convention centre, women’s hostel, guest houses, rest and recreation facilities and a boat club. The government will spend `50 crore for developing infrastructure and Infopark will act as a single point developer. Infopark is home to over 13,500 IT professionals and the Phase II will take the number to 85,000.

Steel Complex JV on stream

Steel Complex Ltd (SCL), which runs the only mini steel plant in Kerala, has got a new lease of life with the launch of a joint venture with Steel Authority of India Limited. The JV, in which both partners hold equal stakes has launched a `65,000-tonne, `47.64-crore rolling mill. As per the JV agreement, SAIL will take control over its management.

The JV was formed as part of the rehabilitation plan which saw the State government repaying `7.87 crore to SBI through a one-time settlement scheme. SCL, commissioned in 1973, was taken over by the KSIDC after it made losses continuously.

HDIL launches Cyber City

The `2300 crore Cyber City project of Housing Development and Infra16

structure Limited was launched at Kalamassery near Kochi on February 18. The project, coming up on 70 acres of land, will dedicate 70 per cent of the total built-up space of 10 million sq. ft. to IT and ITES industry. In the first of the three phases, the project will have three buildings with total built-up space of 10 million sq. ft. It would also have amenities like a hospital, training schools, shopping complexes, multiplexes, office space for IT companies and residential areas.

Textile mill returns to life

The State government has re-opened Kerala Spinners Limited in its new avatar -Komalapuram Spinning and Weaving Mills – after taking it over from private hands. The Kerala State Textiles Corporation will now run the company. The government invested `36 crore in the firm to purchase a complete range of new machinery. The new venture will have a hosiery unit, too. The government plans to turn it into an integrated textile industrial complex with an apparel park to be opened adjacent to the spinning mill.

BEL opens support centre

supply to the indigenous aircraft carrier under construction at Cochin shipyard.

Premo Pipe factory

After remaining closed for more than 17 years, the public-sector Premo Pipe factory complex at Chavara came alive with the launch of the construction work for a PVC pipe factory. The factory is being set up by the Kerala Water Authority (KWA) at a cost of `5.93 crore and it was being constructed by HLL Life Care Limited, the Central PSU. The first phase development of the factory will include a PVC pipe production facility and the second phase will see the production of high-density polyethelene (HD) pipes. The third phase will comprise a unit to produce various gadgets required by KWA.

KSDP launches new plant

Kerala State Drugs and Pharmaceuticals (KSDP) has opened a Beta Lactum factory at Kalavoor. The area would have a small medical complex in about five years with the completion of the homeopathy drug factory and the proposed pharmacy college and cooperative hospital.

KSIE sets up CFS Bharat Electronics Limited (BEL), a Central public sector unit, has opened its product support centre at the Kinfra Hitech park, Kalamassery. The centre will provide waterfront support for the Southern Naval Command, product support to a range of equipment and systems of the Navy and the Coast Guard, support outsourcing of Naval System Projects to units of KELTRON and the Sonar Development Projects at the National Physical & Oceanographic Laboratory, Kochi.

It will also co-ordinate equipment

Kerala State Industrial Enterprises has launched the first phase of the Cochin International Container Freight Station at Kalamassery. Completed at an investment of `47 crore, the project has a 16,000 sq.ft. import custombonded cargo handling centre and a container complex with a capacity to handle 1,000 containers. An export cargo handling centre of more than one lakh sq.ft. area will be readied in the second phase.

17

KSIDC News

Interest-free banking to bankroll major projects

to facilitate Islamic financing, he said.

Organisations like AFSL can channelise investment from NRIs, foreign investors and institutional investors to fund mega industries planned by KSIDC. They include an ultra mega power project of 2400 MW at Cheemeni, a high speed rail corridor project from Kasaragod to Thiruvananthapuram, Industrial Growth Centres at Kannur, Kozhikode and Alappuzha Districts, a Life Science Park at Thiruvananthapuram, Electronic Hub at Kochi, Light Engineering Park at Palakkad, City Gas Distribution Projects, Trade & Convention Centres at Kochi and Kozhikode and the petrochemical project, Balakrishnan said.

K T Jaleel, MLA, welcomed the gathering.

How does it work?

Industries Minister Elamaram Kareem speaks at the seminar on interest-free banking in Malappuram

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he one-day seminar on interest-free banking, organised by KSIDC on March 1 in Malappuram, has brought into sharp focus the emergence of the concept as an alternative means for funding ambitious infrastructure projects in Kerala. Speakers suggested that Kerala should waste no time in getting on to the bandwagon and using it for the faster development of the State.

Finance Minister T M Thomas Isaac, who inaugurated the seminar, said the Albarak Finance Services Ltd (AFSL), the maiden interest-free investment venture backed by the State government, would play a vital role in enhancing the infrastructure develop-

ment of the State.

Minister for Industries Elamaram Kareem, who presided, said the bank would spend money only in accordance with Shariat laws. He regretted the delay in setting up Islamic banking though several countries with fewer number of Muslims than India had successfully started this system.

T. Balakrishnan, Additional Chief Secretary in charge of Industries and Commerce, in his keynote address, said at present, Islamic financial services have a size of $1 trillion, and are likely to touch $2.8 trillion by 2015.

European Union nations such as Britain, France and Germany are making amendments in their financial system

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nterest-free banking institutions function on the principles of Shariah which prohibits payment of fees for renting of money and investing in businesses that provide goods or services considered contrary to Shariah principles.

The interest charged is replaced by profit margins on commercial credits and interest expended over deposits is replaced by dividend.

The first bank based on Shariah principles came into being in the Egyptian town of Mit Ghamr in 1963. It later spread to the GCC and East Asian countries such as Malaysia and Indonesia. The global market for Islamic investment products is growing at 15 to 20 per cent per year.

KSIDC-backed hotel opens in temple town

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erala has long been identified as having huge potential for pilgrim tourism. However, lack of infrastructure often impaired its growth. With more projects coming up near major pilgrim centres, the sector is looking for major growth in the near future. The KSIDC18

backed Hotel Devaragam of KP Namboodiri’s Group, recently opened at Guruvayoor, will give a fillip to the hospitality infrastructure of the temple town. The `11 crore hotel project includes a theme restaurant, a 350-seater conference/wedding hall and 37 rooms.

By Invitation

Made In Kerala T

To those who lament the lack of development in our State, I have only this to say, we are lucky that we did not go ahead on a self-destructive path.

Instead, we have a better background to work on our future.

Jose Dominic

here is a paradox about Kerala’s development pattern.

The State with the highest Human Development Index in India is perceived to have missed out on the ‘industrialisation bus’. I have friends who rue that Kerala is a loser on this account. I don’t concur with their opinion. On the contrary, I feel that missing those buses has resulted in our creating a unique Kerala model, a ‘Made-in- Kerala’ pattern of development.

I called it a paradox because it does not tally with the conventional development models. On the one hand, it resulted in Kerala remaining an industrially underdeveloped State.

On the other, it created a conducive environment to create a model which is more plural, friendly to the environment, less consumptive and definitely more humane.

I have found that some of the States who boarded the ‘bus’ early hardly knew where it would take them. They are now forced to embrace costly ways to stay afloat. While the pattern that they have chosen appears to have made them more industrially developed, it still did not address the issue of reaching the benefits of development to every layer of society.

Kerala too embarked on industrialisation and wealth creation, but we had a societal structure which believed in egalitarian principles. Those principles worked, in fact in queer ways, and stopped the “industrialisation” process mid-way. To those who lament the lack of development in our State, I have only this to say, we are lucky that we did not go ahead on a self-destructive path. Instead, we have a better background to work on our future. While most States have already got on to an agenda from

which they would find it hard to disembark, we haven’t started on it yet, and hence we can plan it well.

In the 60 years of our democratic existence, there is hardly any other State which has gone through such a churning as we have done. We voted to power a Communist government and we initiated the multi-party coalition experiment which India now follows. We have had our brush with extreme leftists, centrists, and some rightists, too. Working with this pluralism, we have created one of the most egalitarian societies and one of the most green economies of our country. This should work as the foundation for our future.

We should preserve this elementary nature of our economy and the green idea about our environment. We should lay stress on our strengths and nurture a knowledge economy. We have everything that could lead towards it: a very well-informed population, a very clean environment and some of the best social infrastructure.

We are the most well-connected State: both physically and virtually with our airports and extensive reach of Internet, even in villages.

We are a people who are alive to human aspirations and hence we can design such a future for us and the generations that follow us. We need not worry about the polluting missed buses. We should instead go for the friendly metros.

Our singular task is to make a proper assessment of what we possess now and design our future. We should work towards strengthening this model—the ‘Made-in-Kerala’ model—of development.

Jose Dominic is managing director, CGH Earth Group and Chairman, Kerala State Council, CII. Views are personal.

19

PROFILE

A unique brand M C Jacob, founder of Anna Group, bagged the Kerala government’s first Lifetime Achievement Award for his contributions to industrial development. The septuagenarian is an encyclopedia on entrepreneurship and brand creation

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Aby Abraham G K

itex, acronym for Kizhakkambalam Textiles, is one of the most popular brands in Kerala.

From the Anna stable, which entered Kerala kitchens with aluminium utensils, flavoured Malayali palates with Sara Spices and added colour to their children’s lives with garments and schoolbags, each of these brands owe their popularity to the vision of one man: M C Jacob. No wonder the State government has chosen the 79year old patriarch of Kerala industry and founder of the Anna group for the first Lifetime Achievement Award for an industrialist this year.

Mr Jacob started his career as a contractor with the Public Works Department. The entrepreneurial bug bit when he came to know that Tamil Nadu-based companies make and sell aluminium vessels and utensils in Kerala using the scrap from the INDAL plant in Kalamasserry, his neighbouring panchayat. Mr Jacob decided to experiment with the new idea. He headed to Tamil Nadu, and came back with the technology to make aluminium products and with some expert workers to train his people. With a few thousand rupees and eight employees, he set up Anna Aluminium in 1968.

“I was hoping for a smooth run, as there was easy access to raw material and a market waiting for the product,” says Mr Jacob.

But it was not to be. As soon as he started production, competitors from Tamil Nadu started dumping their products, forcing him out of the

20

market. Huge stocks piled up at Anna godowns. The future looked bleak for the young entrepreneur. “But we held on, thanks mainly to a timely loan that the then Federal Bank chairman K P Hormese extended to us with the stock as security,” says Mr Jacob.

Fortune often favours the brave.

Mr Jacob has a four-point checklist for the success of a product: there must be a need, it must be of good quality, priced reasonably and supported by advertisements

And it came in the form of power cuts in Tamil Nadu, affecting the powerintensive aluminium smelting there.

Hit by shortage, traders from Tamil Nadu started queuing up before Anna and the huge stocks disappeared in no time. That too, at handsome profits.

“Customers had to wait for up to two months to get supplies,” remembers Mr Jacob.

An added bonus was that customers vouched for the quality of the product; the Anna brand gained mindshare and market share. Its plant was officially inaugurated by then Kerala State Industries Minister, N E Balram, in 1974.

The next stop for the entrepreneur in Jacob was Kitex. Mr T V Thomas, then Industries Minister, called a meeting of industrialists to make use of the precious 4,000 power looms allotted to Kerala in the licence-permit raj. He wanted them to form 10 units with 400 looms each.

Mr Jacob, who offered to set up one such unit, picked the ‘lungi’ to be his product as it, too, had a ready market. The quality product which came at a reasonable price soon found takers. “Old timers would definitely remember the advertisement campaign for the Kitex brand,” says Mr Jacob.

Mr Jacob then ventured to another potential segment by launching Saras Spices in 1978 and was the pioneer in branded curry powders in the State. “The ingredients in the condiments are cleaned with a water jet to remove impurities and pesticide residues,” he says. “This leads to higher losses and hence the products are priced higher.” But the consumers

Industries Minister Elamaram Kareem presents Anna group chairman M C Jacob the first Lifetime Achievement Award were willing to pay a premium for the quality product. It also gave birth to an industry in which Kerala holds top position now. The company now exports ready-to-eat and ready-to-cook items to many countries. The technology for this product was acquired from the defence research laboratories. The products have been approved by the Food and Drug Administration (FDA) of USA and have received the AGMARK certification in India.

If managements demonstrate sincerity and concern for the workers, and follow a no-nonsense approach, labour problems can be easily tackled, says Mr Jacob

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range of packaged products, such as pressure cookers, milk boilers, thermal cookers, compact idli cookers etc. are highly popular.

Besides aluminium products, the Anna Group is involved in the manufacture of food products, textiles and school bags. When the company diversified into these, it held on to its strategy of creating brands for products of everyday use. Many Kerala brands—Kitex, Chackson, Saras food products and Scoobee Day bags— were born in the Anna stable.

Kitex Garments now has an order from the multinational, Jockey International, for the production of the innerwear brand Stay Cool. This product is based on the outlast technology developed by NASA, which ensures that the body temperature is maintained at a comfortable 23°C. Kitex is the first company in the world that has been given the contract for this product. “The contract has provided us a better insight into the global practices for making dress materials, especially inner wear,” says Mr Jacob.

The group faced its share of labour issues in the past and dealt with them firmly. “If your position is just, you can

hat differentiated Mr Jacob from the other entrepreneurs who boomed across Kerala in those days? “Thrust on the brands,” says his son and Anna Aluminium, managing director, Bobby Jacob. “He realised that a brand is both a challenge and an opportunity, and worked out his plans.” When the Anna plant was inaugurated, he gave a full-page advertisement. “It was unheard of then,” says Mr Jacob. “Even now, we think twice before such a move.”

The company places huge emphasis on adherence to quality standards.

The Bureau of Indian Standards has awarded ISI mark for all Anna Aluminium products. “The ISI standard places restrictions on the manufacturing processes and the materials and components that go into it. This helps us maintain the quality,” says Mr Jacob. “A product that people need, good quality, a reasonable price and advertisements are the four ingredients for building a brand and achieving sales.”

Today Anna Aluminium manufactures aluminium sheets, circles, vessels and utensils from 99.5 per cent pure aluminium ingots. Its ‘Chackson’

afford to be firm. If the management demonstrates sincerity and concern for the workers, and follows a nononsense approach, labour problems can be easily tackled,” says Mr Jacob.

“We have a cordial relationship with our workers. We prefer to deal with them directly, rather than through third parties. Our workers also seem to like this arrangement.

The management should be a role model for the employees,” says Mr Jacob. Not surprisingly, the company does not have any unions at present.

“The Anna group is proof that our State holds immense potential for entrepreneurship. It is much easier to start and run businesses here now, with the labour issues fading off,” avers Mr Jacob. “Now the struggle is for quality workers.”

The future looks promising for the company with people becoming more and more brand conscious. The group has been growing its turnover at 20 per cent a year and hopes to maintain the growth rate for the next few years.

“There will be a consolidation in the market with small brands being taken over by big firms,” says Mr Jacob. “The trend towards outsourcing will continue to gain strength. The competition to Indian companies will not be from China, but from other low-cost nations like Bangladesh.”

From its modest start with eight employees, the Anna group has now grown into the single largest private sector employer in Kerala with nearly 12,500 employees.

With its penchant for making the most of the opportunities that arise, the Anna group should be well prepared for the race ahead.

21

Women Power

Stitch in time Women in Cheruvannoor in Kozhikode set up footwear stitching units and turn vendors to big brands. A village model for all industries Kuruvilla Chacko No women, no cry …………………..

My feet is my only carriage So, I've got to push on through

Bob Marley

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ut to Cheruvannur, on the outskirts of Kozhikode. The women in the coastal village may not have heard of the Jamaican singer or his emancipation song of the seventies, but have chosen not to cry.

Instead, they push on through their lives on their feet, their only carriage, by adorning others. And in style.

In several villages around Kozhikode, capital of Kerala’s footwear industry which directly employs about 5,000 people, skilled women are busy crafting footwear parts. Housewives till three years ago managing one square meal a day for their families, they are entrepreneurs in their own right now. The transition took only three years since it dawned on K P A Hashim, then standing committee chairman of the grama panchayat that the women can be drafted for the skilled work in the footwear industry flourishing in the region. As many as 200 footwear manufacturing units function in the district.

22

The idea needed solid backing from the government and the industry in the form of trainers to impart skills to the housewives for the work, and industries to employ them once they completed the training.

Mr V K C Mammad Koya, chairman of VKC Industries, manufacturers of one of the leading footwear brands based in Kozhikode, came up with an offer of support. He would supply the cut raw materials for stitching and buy back the finished products. The women may not be on his payroll but had a guaranteed job.

“We knew women can do as much or even better than men,” said Mr Koya.

“We just needed to instill the same confidence in them.”

The Footwear Design and Development Corporation (FDDC), an organisation that helps provide skilled labour for the footwear industry in the state, filled the other gap and proved to be the perfect tutor. Since the project involved women's empowerment in a

rural setting, Kudambashree Mission, the government-sponsored self-help group, was also roped in.

The tough task was to convince the women, and even men, in the conservative setting, that taking up a job was a good idea. “We had to scout and canvas a lot just to get 10 women for the first batch,” said FDDC director Mr P K Narayanan. The programme started off on November 10, 2009.

The training involved imparting skills in stitching the footwear upper.

The one month programme costs `4,000; the women of Cheruvannoor, with Kudambashree support received the training for half the amount. The training had an unusual component, too: lessons in personality development. It not only trained participants to stand on their own feet, but also made them aware of their importance to their family.

By the time the first batch completed its training, the panchayat constructed a building with space for 12

units, of 10 members each to work from. The village cooperative bank offered a loan of `2 lakh to each unit on a guarantee provided by the panchayat, half of which was paid back later by the Kudambashree Mission.

The 120 members contributed `1,000 each to raise the working capital. And the wheels of change started to roll.

Today, the 12 units from Cheruvannoor together stitch close to 6,000 pairs of footwear a day. The women manage the units themselves and are in charge of its daily affairs. The members select a president and secretary for each unit. Says Ayshabi K T, president of one of the units, “We work in complete harmony so as to finish more pairs daily. With increased efficiency, we can increase our revenue and save enough to buy other essentials like generators and new machines to expand our units.”

Other families in the village have finally realised its potential and FDDC today has its hands full. It conducts at least three one-month training programmes a year for batches comprising 30 students each. It recently opened a new centre at IGC Kinalur to meet the increasing demand. The women come from all parts of Kozhikode as well as from neighbouring districts, according to Mr Narayanan. To date, they have trained more than 600 women.

Recently other footwear companies such as Odyssia and Jogger have begun to outsource their stitching

Mr V K C Mammed Koya says women in villages can be trained in auxiliary sectors of local industries, be it footwear or food processing. “Women in Kerala villages, though educated, might not venture out of homes to work fearing lack of support. Awareness and personality development programmes can change that,” he said works to the units. “We are planning to increase the number of units at Cheruvannoor from 12 to 25 in addition to the unit at IGC Kinalur,” Narayanan said. “Additionally, we help the trainees get a job in footwear companies.” Units have a healthy competition among themselves to get more pairs done per day, thereby creating an atmosphere of quality with quantity.

The passion with which they do the job is evident in the quality of finished products coming out from these units. Said Mr Mohammad Shafi, Production engineer with VKC, “The rejection rate of finished products reaching us from the Cheruvannoor and Maaradu units is very low, around 0.5per cent. The stitching is done well and with care.”

A touch of change

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he SPARSAM (Sustainable Project for Poverty Alleviation and Reformation in Seabelt Area of Maaradu) project, a replication of the Cheruvannur programme, helps Maaradu village come out of its haunting past of communal strife. The 28 odd women working in the three units functioning here are the symbol of recovery and knowledge among the largely uneducated masses. It’s been just nine months since the start of operations, but the women working here already earn around `3,500 a month. But more than the money, it’s the confidence and courage that comes with self-employment that matters. Says Savitha, 31, “Earlier, we were scared to get out of our house alone. But now, since we are working, we have respect in the village and this has translated into self-confidence.” The new job has given Farida T, 29, the courage and confidence to face the outside world without fearing the past. C Ramba is happy that the work provides an opportunity to be engaged throughout the day, instead of wasting precious time idling at home.

Most of these units have paid off the loans they took from the cooperative banks and the women have now almost cleared their personal debts as well. After paying the rent, electricity bill and loan amount, each one takes home `5,000 a month.

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his financial security is what is driving more women to discover the advantages of learning a trade. For women like Salma T, the money helps her children receive better education.

Said Rumiya, 33, “Above all, we are more respected now due to the contribution we are making to society. That’s what really matters.” The women at Thara Sthree stitching unit at Nallalam village also talk about more independence and respect that come with being self-employed. Their incomes have raised the standard of their lives.

Their children eat better food, and all of them go to school.

“The programme shows how women empowerment can change an entire area and with it an entire generation of people’s mindset,” said Ayshabi.

The success of the programme has inspired Pallikkal panchayat of the neighbouring Malappuram district to design similar ones. The panchayat officials studied the model and are planning to implement it in their village, says Mr Hashim.

Everything gonna be alright Everything gonna be alright Echoes of the Bob Marley song, perhaps.

23

Cover story

Jai kisan

Jai machine

The enduring image of Kuttanad of labourers singing harvest songs has vanished.

The humming harvesters have replaced them all.

Photo: Kuruvilla Chacko

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A revolution sweeps across the paddy farms of Kuttanad. It has changed the farming practices of Kerala’s rice bowl for ever and brought the dying vocation of farming back to life. The main weapon in this revolution is the combine harvesting machine

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Aby Abraham G K

osekutty Kalasserry stood dumbstruck at the crossroads. So did paddy farming in Kerala.

With more than 100 acres of paddy fields ready for harvest and an inclement weather all set to spoil the party, Josekutty, 52, ran helter-skelter to get labourers, but to no avail. The labour unions, which could not muster the high number, would not withdraw its opposition to the use of harvesting machines either. Desperate, the farmer for 35 years told himself: from now on, its welcome mechanisation or goodbye farming.

“I told the union leaders that machines were the only alternative,” he recalled his negotiations held five years back. “You will not be able to stop the machines. If not now, later. If not me, someone else.” Left with little option, the leaders gave in.

And the farmer’s words proved prophetic.

Today, only machines harvest paddy in Kuttanad. More than 300 machines are deployed in the peak Puncha season for the last three years. Manual labour has been reduced to the minimum, like harvesting the paddy on the sides or in water-logged fields. The enduring image of Kuttanad of labourers singing harvest songs has vanished.

The humming harvesters have replaced them all.

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elcome to the world of farm machines that have virtually saved paddy farming in Kerala from near extinction. Farmers across Kerala, especially in Kuttanad and Palakkad which are known for vast tracts of paddy fields, have embraced them forever. The farmer views it with much relief not only because it could replace human labour, whose availability was anyway dwindling. They reduce wastage during harvest, cut costs and make

life a lot easier. “But for the machines, there won’t be even one acre of paddy farming in Kuttanad,” said Mr P M Thomas, president of one of the joint farming groups in Pulinkunnu.

Faster operation The machines bring tangible and instant results. It used to take 10 man days to harvest an acre of paddy; threshing and winnowing took more time. For the harvester, all the jobs put together takes less than 90 minutes.

“It would take us a month to harvest a block of 10 acres earlier,” said K Babu, a farmer. “Now, we begin in the morning, and wind up the entire work by evening.”

The economics of harvester Paddy has to be harvested in a small window of time. If it is delayed, then it is loss all the way: grains fall off the standing crop; and are wasted during harvesting, handling and threshing.

Farmers say timely harvesting using machines results in an average increase in yield by 15 per cent. Given that an acre yields 20-25 quintals of paddy, it works out to be an extra yield of a minimum three quintals.

Combine harvesters mean another saving. The age-old practice has been to give a share of the yield (approximately 15 per cent) as wages to manual harvesters. For a harvester, the expenditure is limited to its lease rental of `1,800 per hour.

For a farmer with 10 acres of land, the economics work out to be thus: Manual labour: Total yield: 200 quintals Less 15 per cent as wage share: 170 quintals Total income: 170 X 1400=`238000 Harvester Total yield: 230 quintal (15 per cent extra by preventing wastage) Total income: 230 X 1400 = `322000 25

Josekutty Kalasserry overcame opposition from labour unions and introduced harvesters in Kuttanad.

Now he is busy cultivating paddy in fallow lands.

were a few problems in using these machines. Apart from opposition from farm labourers who feared a loss of livelihood, the farmers faced the problem of the sinking of the machines in the muddy soil. “But we have now learnt to deal with such problems,” says Josekutty. He also said the operators were afraid to send the machines to Kuttanad fearing trouble from the unions. “It took much convincing on my part to get the machines here.”

If combine harvesters were the new kids on the block, the older ones like tractors and tillers have also had a good run. “The sales of tractors in the region have shown an increas-

Less machine rentals: `24000 Net income: `298000 Net difference: `60000 Better quality grain The quality of the paddy obtained through mechanised harvesting is better. Since the harvesting is done quickly, in a day or two after the rice ripens, farmers need not worry about un-seasonal rains that cause the rice to fall and germinate. This also reduces the risk to the quality of rice due to higher moisture content.

A combine harvester costs around `30 lakh a piece and most of the farmers lease it from operators from Tamil Nadu. Initially there

ing trend over the past five years,” says Mr Zachariah Varghese of CC Kurien & Co, dealers for Mahindra Tractors in Kerala.

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achines may be the single biggest factor that saved farming in Kuttanad, but it is definitely not the only one. The State government’s procurement scheme and incentives by the State and Central governments have also played a crucial role in bringing farming back.

Marketing made easy Paddy farmers used to be at the mercy of the middlemen who purchased the grains from them. Most of the

The rise and rise of paddy 14 13

Rate/kg in`

12 11 10 9 8.5

8.5

Season 26

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Quantity in tonnes

farmers in Kuttanad do not have facilities for storing their produce.

The rice fields are often located far away from their houses, sometimes even in the midst of backwaters.

Transporting the harvested rice for storage before selling them was not a viable proposition. The farmers had to sell the produce at the field itself, which reduced their bargaining power. Quite often, the middlemen even defaulted on making the agreed payment.

The decision of the government to procure paddy directly from the farmers has changed all this. The Kerala State Civil Supplies Corporation (Supplyco), a government-run retail chain in the State, procures paddy directly from farmers.

Supplyco has put in place a foolproof system for the procurement of paddy by coordinating with farmers, mill-owners and banks. It issues a unique ID to farmers who register their names with its Paddy Procurement Office. It also allots areas to registered rice mill-owners to collect the grain once the harvest begins.

The mills collect the grain and issue a paddy receipt (PRS) to the farmers. Supplyco then verifies the PRS and deposits the money in the accounts of the farmers, as soon as the government sanctions the payment. The mill-owners, in turn, process the paddy and sell the rice back to Supplyco, which distributes it through the Public Distribution System under an arrangement with Food Corporation of India. It also sells part of the rice through its own retail chain.

The process takes up to four months, but the farmers are assured of the payment. They can even discount the PRSs at banks, if they require the funds immediately.

The system has helped banks extend loans on easy terms to farmers. The banks deduct the loan amount on crediting the farmer’s share in his account. This ensures prompt repayment and a good repayment record for the farmer.

This, in turn, makes them eligible

Farming in netherland

Pradosh Mathew, one of the younger lot in Kuttanad who stays committed to farming, is on his way to the farm.

“A farmer cultivating on his own land can hope to earn a decent profit now. The yield from one acre will be around 20 – 25 quintals which will fetch around `30,000, given the current procurement price”

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arming in Kuttanad is a shining example of what human endeavour can achieve. The paddy fields here consist of contiguous blocks, bound by waterways. Some of these blocks have an area of more than 1000 hectares. Many of them have been reclaimed from the bed of backwaters, often lying up to 2.5 metres below the mean sea level (MSL).

Bunds (dykes) are raised to protect the farmlands from sea water.

More than two thirds of the total land area in this region is wetlands.

The rivers – Meenachil, Pamba, Manimala and Achencoil – drain into Kuttanad, depositing silt in the region, making it very fertile and suitable for paddy cultivation.

The wetlands in Kuttanad are submerged in water for most part of the year. The fields in backwaters are brought into cultivation after

pumping away the water logged in the fields. Kuttanad has two paddy seasons—the summer crop - Puncha - extending from October to March is the main season, when 80 per cent of the paddy fields are sown. The second crop – Virippu – starts in May and extends till September. Only 40 per cent of the paddy fields are cultivated in this season, as many of the blocks will be submerged under water.

The cost of cultivation of paddy is higher in Kuttanad due to the need of bailing out water from the low lying blocks, and repair and maintenance of the dykes. The eco-system also helps the excessive growth and spread of weeds and insects, often leading to plant failures and crop losses. What sustains farming in Kuttanad is the high productivity due to the high fertility of the soil.

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for loans at a lesser interest rate in future.

“Last year, we procured paddy from 27,000 hectares in Alappuzha district,” said Mr Anil K Anto, Paddy Procurement Officer of Supplyco in Kuttanad.

“The quantity of paddy that we procure from the Kuttanad area has shown an increase over the past few years,” says Mr N P Antony, managing director, Kalady Rice Millers Consortium Pvt. Ltd. “The farmers are increasing cultivation, as they are now assured of payment for the paddy they supply.

The quality of the paddy is also better.”

Lord of harvest Fr Peeliyanikkal wants subsistence allowance for farmers

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armers raising crops on leased land get no bank loans as it has no legal backing in Kerala. Private lenders, the only alternative, charge up to 70 per cent interest, the main reason why a single crop loss can land farmers in a debt trap.

It took the ingenuity of a Catholic priest to design a scheme which made policy-makers and bankers think differently. The result: farmers in Kuttanad can avail loans at a rate of 5 per cent.

Fr Thomas Peeliyanickal, Executive Director of Kuttanad Vikasana Samithi (KVS), is different from his peers in that he racks his brain not about the lost sheep, but the wilted crop.

He often comes out with simple and practical solutions to farmer’s problems. “As a group that feeds society, they should not only exist but also progress,” he says. “Sufficient and timely credit is a pre-condition for this.”

Seeing that self-help groups have limitations, Fr Peeliyanickal mooted the concept of joint liability groups ( JLG). A JLG has 5-10 members, with each person cultivating 5 acres of land. The KVS approached State Bank of Travancore with a proposal for funding JLGs. A tie-up was eventually formed, with KVS being responsible for vetting the JLGs and monitoring their repayments. SBT gave a loan of `50,000 to each member of the JLG at 9.5 per cent interest in 2006. Seeing that it worked well, and repayment was prompt, the bank extended loans to more JLGs. At present, there are about 380 JLGs in Kuttanad.

The success of JLG had a NABARD team study and recommend it for the revival of fallow lands. The government is trying to take the model across India and start 1.5 lakh JLGs. Fr Peeliyanickal fears that food security will be a big issue in the coming years. “There has to be someone to produce food. It is time the government gave a monthly subsistence allowance to the farmers, in recognition of their efforts,” says Fr Peeliyanickal.

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Better prices The rise in the price of rice is another major factor that has brought farming back to Kuttanad. The procurement price provided by the government has also showed a marked increase over the years.

From `8.5 a kg in 2006-07, it has increased to `14 this year. This has been a boon for the farmers here, who unlike those in other parts of the State, do not have the option of diversifying into other crops, especially cash crops.

The change While the machine and the government efforts helped the older generation to stay put in farming, it has also made a younger lot turn to farming. Pradosh Mathew, 31, has taken to farming in a big way. He has nearly 100 acres under cultivation.

Some of it is his family property, while some has been taken on lease. “It costs around `12,000 to cultivate paddy on one acre of land,” says Pradosh.

“The yield from an acre will be around 20 – 25 quintals which will fetch around `30,000. A farmer cultivating on his own land can hope to earn a decent profit now.”

The increase in profits from farming is reflected in the lease rentals also. An acre of paddy field fetches up to `12,000 as lease rental depending on factors like ease of cultivation, distance, expected yield, etc. Not surprisingly the area of fallow land in Kuttanad is steadily decreasing.

The State government through its various schemes provides `21,000 per acre as subsidy for fallow land cultivation. “Putting land that has been fallow back into cultivation is an expensive and tedious affair. The various schemes of the government which support cultivation in fallow lands are

Paddy fields which remained fallow for years on end are in great demand now. The lease rental has gone up to `12,000 an acre from `500 five years back

The Kuttanad package

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he Kuttanad package takes an integrated approach to solve the problems this unique region faces.

Designed by renowned agricultural scientist Dr M S Swaminathan, who also hails from the region, the `1,850-crore package covers about 50 different activities. Launched in 2010, it is expected to be completed in 5 years covering 31,000 ha in Alappuzha district, 18,067 ha in Kottayam district and 5,868 ha in Pathanamthitta district.

Among its goals are the promotion of a scientific water salinity management and flood control strategy in the Vembanad Lake which will help to harness the needs of both paddy and fish cultivation, improvement of the productivity and profitability of rice–fish farming systems, provision of essential centralised services such as farm equipment, threshing, drying and storage facilities, agriclinics, agri-business centres and computer-aided knowledge centres, introduction of credit and insurance systems and the improvement of marketing infrastructure.

A plan to declare the area a special agricultural zone is also under consideration.

“But for the machines, there won’t be even one acre of paddy farming in Kuttanad,” said Mr P M Thomas, president of one of the joint farming groups in Pulinkunnu providing the necessary impetus for the same,” says Mr Varghese Antony Pattathil, a career farmer specialising in cultivation of fallow lands. Mr Pattathil started farming in 1982 on 1 acre 42 cents of ancestral property. He now has around 200 acres of paddy under cultivation. “We usually go for a three-year lease. The expenses are high in the first year and we make up for that in the second and third years, when the costs come down.” Mr Pattathil said most owners take up cultivation on their own once the lease is over.

“If the government continues to support farming, in five years there will not be any fallow land in Kuttanad,” says Mr. Josekutty who now specialises in fallow land farming.

For Mr Babu Kuruppassery, a small-scale farmer who cultivates two acres of his own land and 36 acres of leased land, the experience with farming in Kuttanad has been a mixed one. “The new procurement system has helped farming in Kuttanad,” he said. The rise in procurement price has also helped, but it has

been offset to a large extent by the increase in input costs like wages and lease rentals. “The farmers often get only a minimal share of the rise in prices,” says Mr Babu.

Farmers get little protection from the vagaries of nature, he rued. “This year the rains lasted till December and damaged the dykes,” he said.

“This delayed sowing and so pest attacks were higher. We will be in trouble if the Thannermukkam bund is opened on schedule this year.” He suggests that the government implement the Kuttanad package at the earliest and improve infrastructure to prevent crop loss due to damage to the dykes. “While implementing the project, priority should be given to regions which are more vulnerable. The insurance scheme for crop losses should also be reorganised so that claims can be awarded to individual farmers and joint farming blocks also,” says Babu.

The Central government has come up with the Kuttanad package to support the farmers in the area (see box). The package aims to build and maintain the required infrastructure needed for farmers. It also takes an integrated approach to solve the problems faced by the area.

Of course, authorities can now go ahead with their plans for Kuttanad.

For, farmers are back, thanks to those machines. And Josekutty chose not to drop out: he has now more than 600 acres of paddy farm under joint cultivation.

Jai kisan. Jai machine

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Healthcare

The Ernakulam General Hospital houses one of the best neo-natal care units in Kerala

Healthy hospital The Ernakulam General Hospital becomes the first government hospital in Kerala to bag the NABH certification

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Asha Jacob

overnment hospitals in Kerala are seldom known for their facilities. A stay there is often “frightening”, as K Leela from Cheppanam on the outskirts of Kochi, says.

“There were no beds; we used to sleep on the floor,” says the 60-year-old, recalling her visit to the Ernakulam General Hospital (GH) a few years back. “There was no food or drinking water. Water from leaking roofs flooded the rooms; doors and windows were broken; rooms and corridors were filled with garbage; and the toilets were dirty.”

But that was then. Today, Leela, who is back in the hospital with her grandchild, Libinsha, notices that it is a changed place. “Now it is more

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than a hospital. There are enough staff, clean rooms, corridors and toilets, drinking water, good food and free treatment. Doctors visit us regularly and patients get proper care.”

What happened in between her two visits? Quite a lot. The hospital became the first government hospital in Kerala, and the fourth in India, to get a certification from the National Accreditation Board for Hospitals and Healthcare Providers (NABH).

NABH, a constituent body of the Quality Council of India (QCI), operates accreditation programmes for healthcare institutions. It is part of the various programmes conducted by the National Rural Health Mission (NRHM) to ensure quality of service in government hospitals and provides a benchmark against the best hospi-

tals in the country.

The achievement becomes commendable given that the Ernakulam General Hospital has 783 beds, whereas the other three government institutions which bagged the prestigious certification are a Primary Health Centre and two district hospitals , all three in Gujarat. The other awardees in the State are corporate hospitals.

“A government hospital seeking accreditation was looked at with scepticism,” says Dr Junaid Rahman, Superintendent, GH. “Even the staff was apprehensive, if not dismissive.

We had to change our practices drastically. But once on track, the staff was overwhelmingly supportive and there was great teamwork towards the goal.”

The hospital started with health checkups and vaccination for the staff,

who was then appointed to supervisory positions to oversee the daily activities. Intensive trainings were also arranged on infection control practices, patient care and quality improvement.

Getting there NABH defines the accreditation norms in 10 chapters consisting of 100 standards and 514 elements. This covers every aspect with regard to patients, as well as staff, such as access, assessment and continuity of care, medication, patient rights, infection control, quality improvement, management responsibility, HR management, facility management and information management.

For accreditation, hospitals must score a minimum of 8 on a scale of 10 for each chapter.

The idea to aim for NABH accreditation for GH was put forward by Dr Dinesh Arora, Mission Director,NRHM. The accreditation procedure started in October 2008. A QCI accredited agency, ACME Consultants, provided technical support to hospital authorities. They conducted a gap study on the facilities available in the hospital based on the NABH parameters. Two situation studies, four hospital-level audits and 2 pre-assessments were conducted before going for the final assessment.

The NABH team conducted its pre-assessment on January 31 and February 1, 2010. Corrective actions were taken on non-compliances re-

ported and the final assessment was conducted in mid-May. The hospital now has state-of-the-art facilities that are comparable to the best private hospitals.

The operation theatres and the store were reno- The state-of-the-art laboratory at GH vated as part of the programme. The additional facili- surveys are conducted regularly to ties are a central sterile supply depart- evaluate patient satisfaction.

“The NRHM focuses on providment to ensure high quality surgical equipment, four new ventilators and ing quality healthcare to patients,” two anaesthesia workstations. The says Dr K V Beena, District Prohospital now has a waste treatment gramme Manager, NRHM. “The plant to handle degradable waste from NRHM provides doctors, staff nurses the hospital. Visitors can also avail of and biomedical engineers on demand. a new hospital dormitory. Canteen The quality manual of NABH deals and power laundry facilities are also with every minute aspect concerning patient care and safety. Anything provided.

“The government gave quick ap- that poses a threat to patient safety is provals for constructions needed,” avoided. Medicine administration is says Dr Rahman. “We constructed given utmost care. Inter-department three new wards to overcome the and intra-department audits are conspace crunch. The district NRHM ducted regularly to evaluate the practeam provided technical and financial tices and corrective actions are taken help at every stage. The Hospital De- based on the report.” NABH is an velopment Committee headed by the institutional member of the InternaDistrict Collector rendered support tional Society for Quality in Healthfor all the activities. Also, the sponsors care (ISQua), she said, adding, in effect, the certification is an internadid a great job.”

The NABH accreditation ensures tional recognition.

Ms Hema K R, Public Relations that patient rights are protected and Officer at the hospital, talks of the careful documentation of case sheets for every patient. “This helps proper follow up,” she says. “Every patient gets a citizen chapter explaining their rights. All this makes it a patientfriendly hospital.”

Staff too, have benefited from the accreditation. It ensures a good working atmosphere, a continuous learning environment and training on new practices. “It is great that poor people can get quality treatment at a nominal cost,” says Dr Joseph Francis, Chief Consultant, General Surgery, at the hospital. “The operation theatres boast the latest equipment.

Surgical ICUs were constructed for patients undergoing surgery, which help in giving them proper attention 31

A government hospital seeking accreditation was looked at with scepticism, says Dr Junaid Rahman, Superintendent, EGH. Even the staff was apprehensive, if not dismissive. But once on track, they were overwhelmingly supportive and there was great teamwork towards the goal

All changed…

The hospital follows procedures in every process, starting with registration to discharge of patients. The OP section has a token display system. An enquiry counter provides patients and visitors with relevant information. The Advanced Life Support (ALS) ambulance facility cater to emergency situations like referrals to other hospitals.

The hospital houses one of the best neo-natal care units in Kerala, equipped with the latest devices to tackle emergencies.

Specially trained staff takes care of the newborn. The pathology department has in place the latest diagnostic equipment.

A waste management plant, set up in the hospital premises, converts degradable waste into manure. It also generates electricity which lights up some areas of the hospital. The bio-medical waste is sent to the treatment plant of IMA in Palakkad, for disposal. “Cleanliness is given utmost importance,” says Marykutty, retired nursing superintendent. She still serves the hospital, taking care of housekeeping. “Proper housekeeping is very critical as it reduces the chances of infection to a great extent.”

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and care. Even though the workload has increased, the process has become very disciplined.”

The hospital has 63 doctors, 278 staff nurses and 110 house surgeons.

“There is now a systematic approach to work. The satisfaction on the faces of poor patients on getting quality service is our biggest reward,” say Dr Jimmy Jose and Dr Muneer, house surgeons.

Gopi, from Aluva, a house painter, recuperating after a knee surgery, is all praise for the new-look hospital, the doctors and the staff. “I have been here for three weeks and have recovered fast,” he said. “They clean the ward twice a day, whereas the private

hospital where I had gone earlier used to stink.” That the food and medicine is free is another attraction for Gopi, whose only complaint is that he had to depend on the medical stores outside for some medicines.

The hospital management is in the process of setting up a dietary department, catering to the specific diet requirements of each patient, at an estimated cost of `1 crore. A digital X-Ray unit, the first of its kind in the government sector in Kerala, is also scheduled to come up.

It's good that in spite of initial scepticism,the GH has taken great strides in providing quality healthcare to the public.

The hospital now has a waste management system to handle degradable waste from the hospital

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Tourism

Once upon a time in

The Muziris Heritage project is another feather in the cap for the ever innovative tourism industry in Kerala. Conservation amidst commercialisation is the goal of this project

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Kuruvilla Chacko

fter nearly eight centuries, the ancient port of Muziris, in present-day Pattanam village, which conducted a flourishing trade with the Greeks, the Egyptians, the Romans, the Arabs and the Chinese, is coming back to life.

Kerala’s market-savvy Department of Tourism is readying itself with the country’s first planned heritage tourism initiative, the Muziris Heritage project (MHP).

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The `180 crore initiative, with a central government funding of `40 crore, is Kerala’s first green tourism project and stretches across two districts including seven panchayats, from North Paravur in Ernakulam District to Kodungallur in Thrissur District.

Why is Muziris stirring up so much excitement? The prosperous port has a fascinating past and offers a glimpse to the glory this region once had. Imagine trading in spices and jewellery with ancient Romans.

Muziris is mentioned in the historic tomes of 1st century Greco-Latin historians Ptolemy and Pliny, and also in classical Indian accounts. The great ancient kingdoms traded in gems such as garnets, quartz, pearls and lapis lazuli, aromatics, cotton and spices, especially pepper. Old papyrus accounts talk of the existence of a Roman merchant colony on this coast. Some artifacts indicate Roman ships might have been built in India and were probably crewed

by Indians.

Kerala

Excavations here have revealed the largest number of amphora (Roman pottery) fragments used for transporting wine and olive oil, apart from Roman coins and beads, outside of the Roman Empire.

Also, there was always an element of mystery because of the abrupt end to trading in this major port around the middle of the 13th century. One theory attributes it to an earthquake, another to the great flood of 1341 AD recorded in history, which caused the river Periyar to change course.

The project today aims to restore and showcase locations and cultures depicting the glorious past of a region. Mr Krishnachandran P K, General Manager-Business Development of Intersight Tours &

Travels says, “Being in stark contrast to the popular but regular menu of beaches, hill stations and backwaters, this project will help innovate and improve the quality of tourism services currently offered in the state.”

Carrying the past forward Heritage tourism has for long been the highest constituent to tourism generated revenues across the world.

“The amazing history and mysticism associated with such places create a mixture of patriotism and curiosity in the minds of the local community”, says Ms Maneesha Panicker, manager of Silk Route Escapes, an experiential tour company, which conducts heritage tours in Kerala.

According to her, it is this symbiotic relation that has enabled heritage

sites to be the main draw for tourists across the world.

Heritage tourism is a $400 billion industry; endorsed by 40 per cent of the world’s 880 million tourists, a segment known as alert intelligent travellers. But for some reason, despite having a rich history and varied traditions, India remains a speck in the global heritage tourism industry with just 5 per cent of the foreign tourist arrivals to the country interested in its past; the rest opting instead for the rich flora, fauna and ancient medical practices. The most visited heritage site, the Taj Mahal, witnesses close to only 3 million tourists annually, which though impressive on the national level isn’t big when compared with its global compatriots. The Pyramids attract 12 35

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million foreign tourists and the Great Wall of China attracts more than 20 million foreign tourists annually.

Says Mr V M Sunil, special officer for MHP, “The project will bring to life centuries old traditions and practices, along with a walk into the past through the historical town of Kodungallur and its adjacent provinces, all within an area of 40 sq.km.”

Adds Mr G Pramod, Senior Consultant with KITCO Consultants, which provided the consultancy for the project, “Malayalees can now take pride in the fact that 2,000 years back they were the gateway to other civilisations in India.”

The MHP is scheduled to be completed in three phases:

The 27 sites being developed include India’s first mosque, the Cheruman Juma Masjid built in AD 629; India’s earliest churches built by St Thomas around 52 AD and various temples such as the Keezhthali Siva Temple and Thiruvanchikulam Mahadeva Shethram, which have been counted as among the oldest in the State, dating back to more than 2,000 years; apart from the Gothuruthy village lifestyle famous for its art and dance forms.

The first phase of the project, to be inaugurated this year will also see the Paravur and Chendamangalam Jewish synagogues, the Paliam Nalukettu and Paliam Kovilakam (Dutch Palace) and India’s first European monument, the hexagonal shaped Pallipuram Portuguese Fort built in 1503, among the new entrants to be opened to the public.

Local villagers are being trained as amateur historians to revive the long-lost folk stories of the once prosperous town of Muziris and its neighbouring regions.

A series of ‘live museums’ depicting age-old cultures famous to the region, like a coir museum, a museum of fishing tools, a museum of spices and an aquatic museum, in addition to the life and works of contemporary men and women of the region will be opened.

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p

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Staying in the past

heritage hotel defines a heritage site; the reason why tourists are ready to pay that extra buck just to get a feel of the region from the comfort of their rooms. According to the Indian Ministry of Tourism, 58 per cent of foreign tourists prefer heritage hotels. The Muziris Heritage Project however, does not include any initiative as yet for a heritage hotel.

Though true, it rings alarm bells on the need for more infrastructure in the region. “Without the accommodation facilities suited to a heritage site, it will greatly affect itinerary circuit and timeline tours, culture tours, museums and backwater cruises; and tourists who wish to spend the evenings enjoying the sights and smells of the region”, says Mr Anoop A, Travel Consultant with Trans Indus Tours.

Kochi, which is just 30 km from the proposed heritage site, is the next best bet to house heritage hotels for tourists visiting MHP. But the city already has great demand for its heritage hotels. Mr. George Davis, Reservations Manager at CGH Earth, the pioneers in heritage hotels in the state says, “We achieve full bookings from October to mid-April, especially from foreign tourists.”

Mr. E.M. Najeeb of Air Travel Enterprises expects an increase of 20 per cent in foreign tourist arrivals once the Muziris project gets its act going, which translates to a corresponding increase in room capacity. All this means just one thing for the potential investor: opportunity. The onus is on heritage developers to utilise it.

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Exhibitions of artisans and craftsmen, workshops by bell metal makers, handloom weavers and wood workers will also be a part of the itinerary. There will be heritage centres displaying performing arts to represent the non-physical aspect of the place.

Boat museums will be constructed in the latter

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phase of the project. These will be real boats modelled on ships from countries that had association with Muziris down the centuries.

These include Romans, Portuguese, Dutch, British and Arabs among others. The museums will showcase the culture and goods used for trading by these countries.

Live trading of the day’s fresh catch of fish, spices and other food items will be held in the form of the age old ‘aazhcha chantha’ (weekly village market and fair) at the Kottappuram, Paravur and Paliam markets. The shops and roads in the market area are being recreated to give tourists a feel of the past.

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Conservation a Priority KITCO which had earlier been involved in heritage conservation projects like renovation of the famed Hill Palace Museum and Bastion Bungalow in Kochi and Krishnapuram Palace at Kayamkulam among others, employed the services of Mr Benny Kuriakose, popular urban landscape architect and a host of other technical organisations for the same.

The biggest support to the project though, was from the people of the region, which has been “excellent”. Raheem, 42, who runs a real estate business in the area, says, “In this initiative, nature doesn’t have to be destroyed to create the past from the present; it just needs to be showcased and preserved in its pristine form.”

He represents the sentiments shared by the local people on the prospects of the project and their eagerness to be a part of it. Adds Mr Sunil, “The expected boost to the rural economy and the restoration of the fading cultural and art forms of the region has endeared this project to the masses”. While the project has seen hitches and the pace has been slow, it is hoped that Kerala Tourism, which has delivered the goods with regards to other tourism segments in the past, can yet again weave its magic and set a trend for others to follow in the country.

Why Muziris needs to do more!

By K C Chandrahasan

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reat heritage sites need to be experienced, not just seen.

The same parameter will define the Muziris Heritage Project. It should make travellers want to return to it; at the same time, refer glowingly about it to fellow travellers.

Kerala Tourism which has initiated this ambitious project would do well to make sure the site has the basic requirements so necessary for a true heritage tourism site.

Firstly, heritage tourism unlike other segments should be marketed differently, since it requires separate standards and skill sets. This is particularly necessary when you consider the state’s dismal record in attracting heritage tourists. Despite attracting 77 lakh domestic tourists and another 6 lakh foreign tourists to the state, just 5 per cent of them visit Kerala’s existing heritage sites like Fort Kochi, Mattanchery and other monuments in the Malabar region. On the other hand, sustained marketing of the state’s natural beauty and attractive packaging of authentic Ayurveda has seen these segments attract 90 per cent of domestic and 75 per cent of foreign tourists visiting the state.

Heritage tourists combine history and curiosity and so there should be heritage specific tour packages and proper logistics catering to the needs of the heritage traveller, who seeks authentic historical locations and surroundings. The tourism department has made plans for the same by planning circuit, timeline and waterways tours, though it is not clear if the infrastructure for the same is in place.

Another hallmark of a successful heritage site is proper documentation of the region and its origins. With all urban cities looking identical, people travel far and wide to go back in time

to a place undisturbed by technology. It is only fair then that they get to access the critical information of a region they so desire to see for themselves. The tourism department has proposed opening of the Centre for Muziris Studies for the same. It is expected to provide data about the history of the region to tourists and local people and will house a digital library, classrooms, scholars’ rooms, seminar halls and an auditorium among others, in addition to encouraging academic and research activities. The concept is good but needs to be implemented as soon as possible, before the first set of serious tourists trickle in.

Also, since a heritage site usually spawns a set of intellectuals around it, educated guides complementing this group is a necessity. They should be well-versed with the folk stories and history surrounding the region, especially since it is the place of origin of many cultures and religions, apart from being a 2,000-year-old port city, where seafarers from different countries converged. This will encourage more youngsters from the region to study history as a subject and provide them with a source of employment and scope of research. Currently, training is being provided to locals to serve as guides, though the quality is debatable.

Lastly, the famous Indian penchant for littering and using famous tourism spots as graffiti canvas has to stop at heritage sites lest it damages the property. Only by educating the local people can a more positive identity be created.

The tourism department is definitely aware of these requirements and has its hands full as it sets about developing better transportation avenues, refreshment centres and other tourism amenities. But unless these finer aspects are incorporated, the project will turn out to be a case of so near, yet so far.

The writer is Managing Director, Kerala Travels Interserve, the State’s first travel agency founded in 1959 37

GREEN ZONE

Well covered

Tensile fabrics, a new roofing application, is a hit with architects

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Kuruvilla Chacko

he facade of the Burj ul Arab hotel in Dubai has been noted for its iconic sails. They bring to life images that are closely associated with the sailors’ life of the Arabs.

Take a closer look, and you will notice that the sails are not concrete. Rather, it is tensile fabric, the new age design fabric.

A strong, flexible and light weight material, tensile fabrics are synthetic fibres with a PVC coating. They are increasingly replacing polycarbonate or corrugated sheets worldwide for roofing and mass gathering applications because of superior features and the imaginative uses it can be put to.

In India, major projects such as the DY Patil Cricket stadium in Mumbai, the MA Chidambaram Stadium in Chennai, the passenger walk bays in Hyderabad and Delhi airports, and the Express Avenue Mall in Chennai have made use of this material. Closer home, the Indroyal Group has zeroed in on tensile fabrics after scouting for a suitable material for pool side and balcony canopies for its new hotel project at Kochi. It needed structures that would merge with the building and have an unorthodox shape to it.

“Tensile fabrics can bend and twist easily,” says Mr Shirish D Lilladhar, managing director of Tarpaulin House, Kochi, which fabricated and erected the structures for Indroyal.

“They form fluid structures, with no wrinkles or gaps, without compromising on the strength, utility or looks.”

Tensile fabrics possess a fairly good strength of 250 KgF; meaning, only a load of more than 250 kg placed on a fully stretched piece of standard fabric strip of 20cm x 5cm can break it. One reason for this durability is that fabric materials, which

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are lightweight and flexible, interact better with natural forces than a rigid material. Though its strength is not comparable to that of concrete structures, it is adequate for safe and sturdy applications.

Tensile structures sprout in India because of its suitability for applications under the sun; literally. These polymers reflect 60 per cent of the incident solar heat, bringing the interior temperature down by as much as 30C. At the same time, they allow 13-19 per cent of sunlight to pass through, which provides sufficient lighting.

These features make it the first choice for building public spaces such as bus stands and canopies in parks.

Roadside kiosks or mobile showrooms also opt for tensile structures.

That they can be pre-designed, disassembled and re-assembled quickly to form portable structures, combined with an easy installation possibility enables them to be set up over a large area for corporate functions or mass gatherings, in a few hours.

A slew of projects coming up in Kerala are banking on tensile fabrics

Tensile fabrics can bend and twist easily,” says Mr Shirish D Lilladhar, managing director of Tarpaulin House, Kochi. “They form fluid structures, with no wrinkles or gaps, without compromising on the strength, utility or looks ”

for its aesthetic and design properties.

“These fabrics enable seamless covering of curved spaces like an exhibition dome or the circular roof of malls and stadiums, something which current favourites like corrugated sheets or concrete structures are unable to do,” says Mr Biley Menon, architect and urban designer at Idea Design and consultant to the C-HEM (Centre for Heritage, Environment and Development), government of Kerala.

An international houseboat terminal in the shape of two joined shells is set to come up in Alapuzha and a huge food court in

Tensile fabrics reflect 60 per cent of the incident solar heat, bringing the interior temperature down by as much as 30C. They allow 13-19 per cent of sunlight to pass through the new corporate house of Geojit BNP Paribas is being planned using fabric structures. “These fabrics allow us to design complex and uniquely shaped structures,” says Mr S Gopakumar, principal architect of Kumar Associates, which built the roof canopy for the IMA building with the same material.

Another project in the offing is the Broadway & Ernakulam Market Heritage Urban Renewal Project in Kochi under JNNURM, which aims to roof the entire stretch of the historic Broadway Road and its surrounding market with tensile fabric structures. “Tensile structures possess all-weather properties, suited for a place like Kerala, which experiences alternate wet and dry conditions throughout the year,” says Mr P C Mathew, associate architect of Design Combine, the firm which put in place the designs for the proposed project.

“Such structures will not be affected by fungus or decay and the UV protection coating will ensure they maintain their sheen through the years.”

The layer of anti-static PVDF (polyvinylidene fluorides) coating, which is the equivalent of the DuPont paint on automobiles, prevents any stain or dirt from embedding into it. This and their anti-creep property results in low maintenance cost, says Mr Mathew.

Once the project is set in motion, the road and the market will resemble a stretch of open shopping mall, without bothering shoppers of the vagaries of nature.

The price factor While it would seem like a good longterm option, the high initial pricing of fabric structures could act as a deterrent. Currently, the structures cost anything between `325-750/sq.ft., including fabrication and installation, which is around 25 per cent more than

Decoding the fabric T

he tensile fabrics or vinyl-coated polyester PVDF is made up of a polyester ation scrim (heavy woven matePVC lamin c rial), exterior PVC coatings ic fabri Synthet and an adhesive agent. The scrim supports the liquid PVC coating applied initially and provides the tensile strength, elongation and dimensional stability of the resulting fabric. The adhesive agent acts as a chemical bond between the polyester fibres and the exterior coating and also prevents fibres from wicking (absorbing water).

The fabric is then put through a heating chamber that dries the liquid coating and PVDF is finally grafted chemically to the exterior of the fabric as a top coating.

luses t The Lpight weiegnhgth

tr  igh s H that for

le eat  lexib 0% h polycar F eflects 6 light % bonate  R llows 19 A structures.  This could inusost M be the dee h T High c ciding fac tor between tensile fabrics gaining mass acceptance and remaining a hi-end product.

But Mr Lilladhar thinks differently. “Tensile fabrics are not just a convenient structural and design material. They also provide aesthetic value by giving off a daytime glow due to the sunlight reflector coating and a reverse luminosity effect at night due to interior lighting. Even though expensive, it is worth every rupee,” he says.

Architects like Mr Menon, however, have a different take. He feels there has to be more local fabrication and designs for large scale projects, if the overall prices for domestic applications are to come down. According to him, not just good design specifications, but also high quality fabric needs to be provided from within the country, if prices are to be within the range for general application purposes. Currently, large scale projects depend on foreign expertise.

Mr Gopakumar puts it thus, “A dash of awareness is required to gain mass acceptance. By being incorporated into corporate and public projects, people will soon see its benefits and opt for it.”

39

Photo: V Sivram

Art

Vernissage Art gallery in Kochi

Riches on canvas

The contemporary art scene in Kerala looks bright as more galleries open to meet a growing demand

T

Kuruvilla Chacko

he 2005 Mumbai-Kochi travelling art exhibition ‘Double Enders’ had an unusual ensemble: noted Malayalee artist Bose Krishnamachari for curator; presence of art lovers from across the globe, and the works of 69 artists from Kerala on show.

Many thought it had all the ingredients that could help recapture the national prominence that Kerala contemporary art once adorned. The show was indeed a commercial and critical success, and made several

40

artists, already noted in their home ground, known all over.

But it did a disservice, too, by creating an art bubble. Galleries opened by the dozen, exhibiting mediocre but overpriced works, riding on the high disposable income and the sudden interest of Malayalees in art as an investment option. Indeed an unhealthy canvas for art to grow.

“The economic recession of 2008 helped clean up the scene,” says artist Rajan M Krishnan, who shot to prominence during Double Enders.

“Only those with real talent and a genuine intent to promote art as an

investment avenue endured.”

The art scene in Kerala is a lot healthier today than when Double Enders arrived. The over-hyped galleries have all closed down. Serious promoters see quality art, and not mindless pricing, as the key to sustainability. The aim is to provide collectors value for their investments and give art its due respect.

Mr Dilip Narayanan, owner of popular gallery Open eyed Dreams (OED) in Kochi, is very optimistic about the current art scene. “It grows at a healthy rate of 25-30 per cent despite the setback caused by reces-

sion,” says Mr Narayanan, who left his job as an investment banker to start OED in 2002. “It’s all about knowing where to find the market.”

He has conducted more than 60 shows in the last eight years. ‘Earth’, held last year, included the works of five generations of artists, including Padmashree Ghulam Mohammed Sheikh and Sudhir Patwardhan, two of the biggest names in contemporary Indian art.

sold.

OED, on the other hand, has built a network of patrons within the State and has only been slightly affected by recession. “Come April and corporate houses in the State are ready to shell out a portion of their income for buying art. These collectors see art purely as an investment,” says Mr Narayanan.

His patrons prefer investing in paintings in the bracket of `1 lakh to `5 lakh. He is setting up a larger gallery in Fort Kochi, the State’s art hub as he is confident that Kerala has more than enough buyers. “Art as a business is easily sustainable in Kerala,” says he. “One should be involved in it completely and channelise contacts properly to reap profits as in any other business.”

An important segment of buyers that has risen during the last couple of years is architects and interior decorators, according to Ms Bindu Nair, CEO of Vernissage Art gallery in Kochi. She says, “The paintings in demand for such purposes are the ones below the `1 lakh mark and include religious or landscape works. It’s heartening to see Malayalees prefer paintings to floral prints and traditional ornamental items for interior decoration in homes, hotels

Sketching the market The talent that Kerala holds is one reason why the galleries thrive. Mr Jose Dominic, CEO of CGH Earth, which runs David Hall, a prominent art gallery in Fort Kochi, feels that collectors from outside come to Kerala due to an increased preference for art coming out of the State.

“Representatives of corporate houses come to buy from here since Kerala offers them quality work at lower prices,” said Mr Dominic. “For them, this is a kind of value appreciation.”

The gallery does more business than initially expected and mainly caters to collectors who look for works priced below `5 lakh.

While most gallery owners agree that Kerala has a great talent pool which creates quality work, they are unsure of the local buyer. According to Mr Anoop Skaria, owner of Kashi Art Café, a prominent gallery in Kochi, “Malayalees come and view the works, but purchases and our sustenance depend on the patronage of clients from outside.”

The gallery conducted an exhibition titled ‘10 light years’ in 2007, in which a collector from Mumbai purchased a painting by popular artist Riyas Khomu for `30 lakh.

The last two years, though, have seen paintings Youngsters with of lower costs potential and being

and office buildings.” This set of buyers may not be serious collectors, but make an important contribution to the growing art scene, according to her.

With so much sanguinity in the sector, young artists couldn’t ask for more. Sanal C S of the Government Fine Arts College, Thrissur, feels the future holds out hope for emerging artists. He displayed his works at an exhibition conducted by the Kerala Lalitha Kala Academy and knows there are investors who will back him, once he shows promise. This is in stark contrast to the days a decade ago when the State barely had good galleries or art promoters, leaving budding artists to make their own fate, says

commitment have a whole lot of options before them, says Anoop Skaria of Kashi Art Gallery, Fort Kochi 41

Sketching the Net he importance of technology in T bridging the gap between the artist and the art enthusiast cannot be ignored, for it helps bring back many famous artists who had left the State years ago in search of greener pastures.

“Today, artists have come out of their shells and are much closer to art connoisseurs. By setting up websites, they have become accessible and can thus work from anywhere,” says Mr Johnny, art historian. Even Mr Narayanan of OED gallery finds the web a convenient tool to connect with his clients.

This trend is not being seen only among galleries and established artists. Even upcoming artists from small towns who are not in a position to hold exhibitions or rent spaces in cities have opted to publicise their works on the web. These websites

Mr Rajan, who remembers his initial days of struggle. Mr Skaria voices the same thought: “Youngsters with potential and commitment have a whole lot of options before them.” Adds Ms Nair of Vernissage Gallery, “People look for new thoughts, new ideas.

That’s exactly the reason why art galleries exhibit paintings of newcomers, who have a different feel to their work.” Most galleries are putting in place facilities to host artists from outside, said Ms Nair. “In fact, 75 per cent of the paintings displayed 42

display their paintings as well as portfolio and allow the customers to review the works of the painter apart from providing valuable insights on art. Also, customers can make online purchases and custom-made paintings. The owner of one such interactive site, a painter by hobby and high school teacher by profession, Mr Biju P Mathew from Kollam, says that his desire to spread his works among people from different places is the inspiration behind the website. He sells on an average 2-3 paintings monthly to clients across the State and the highest price for a painting sold by him online so far has been `5,000. Though not comparable with the high price segment, he feels there are a lot of takers in the medium and low price segment.

“It’s all about fixing your customer base”, he says. in our gallery are of artists from outside Kerala. This will help develop a healthy competition among existing and emerging artists to display their best works, which in the long run will only benefit the standards of art and artists coming out from the State.”

Looking Ahead Although, there’s a positive side to the art culture, the artists’ community in the State feel that a lot more support is required from various quarters to exploit the market fully.

Says Mr Johnny M L, noted art critic and historian, “Compared to people from other parts of India, Malayalees have a very good visual understanding of art, especially since art and culture have been an integral part of Kerala for a very long time.”

Kochi, on its part, is promoting art aggressively and has a vibrant art culture compared to other South Indian cities. Most of the artists also are from Kerala, says Mr Johnny, giving further evidence of an increased preference for Malayalee artists. But the problem arises in convincing Malayalees to invest in art which is seen as a passive asset. Further efforts are required from various quarters to convince them of the viability of art as an asset, he adds.

Says artist Satyapal, Secretary of Kerala Lalitha Kala Academy, Thrissur, “The infrastructure needs to be improved in towns, where more exhibitions need to be hosted.”

Ms Kavitha Balakrishnan, art historian and faculty member at Government Fine Arts College, Thrissur, feels that workshops should be conducted for people keen to be initiated into the world of art. They should be made aware of what art is and the importance it attaches to the thinking of a society. Her thoughts are echoed by Mr Skaria who feels art should be a part of school education so that the culture is ingrained from a small age itself.

Initiatives such as the Kochi Muziris Biennale to be conducted in the State in 2012 are a positive step forward to inculcate the same. Says Mr Johnny, “Such programmes will expose the average Malayalee to artists from abroad and their works and will help put Kerala on the national art radar.” Mr Narayanan also feels that the Biennale will bring serious art lovers and investors from across the globe to the State and adds, “This can only be good for artists and art lovers in the State.”

Mr Johnny expects the media to cover art and the life of artists more so as to increase public interest in the same. Also according to him, celebrity art collectors should express their interests and ideas on the utility of art as an investment avenue.

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ENTERTAINMENT

A hoarding of Christian Brothers en route to the Cochin International airport.

The film was released in 300 centres including several foreign ones

A filmi gamble Multi-star casting. Worldwide release in 380 screens.

Will Christian Brothers set the cash registers ringing?

H

Vijay George

istory was made on March 18, as the much-awaited Malayalam multi-starrer Christian Brothers hit 300 screens across the world. The film, which stars Mohanlal, Dileep, Suresh Gopi and Sarath Kumar as the heroes, has been directed by Joshiy. Rumored to have been made at around a whopping `15 crore—one of the costliest films ever made in this tiny territory—the worldwide release was intended to cash in on the euphoria that will ensure hefty initial col-

44

lections. Now, the million-dollar question is whether the film will be as exciting as the popular brand of brandy of the same name.

“With some of the most saleable names in the industry on and off the screen, the expectation levels are really high,” says Subair of Varnachithra Big Screen, the banner which is producing the film along with AV Anoop’s AVA Productions. “We are going for such a grand release to tap this potential. The film is going to be released simultaneously across the country and also in some foreign countries such as the US, UK, Aus-

tralia, Ireland, Singapore, Malaysia, Bahrain, Qatar and Oman.”

According to him, Christian Brothers is an out-and-out entertainer, which will have all the commercial ingredients required for hit films.

The shooting of the film went on for quite a while thanks to the constant date clashes of stars and other issues, all of which added to the total cost of production.

The general perception in Malayalam is that with its limited viewership, it is a risky proposition to make films with a budget exceeding `5 crore, even if it has a superstar in the lead.

The theatre revenues have come down drastically over the years and the industry is highly dependent on the satellite rights that are offered by various TV channels. Multi-starrers often ensure better initial collections and of course, greater satellite revenue as well. The superstar flicks usually get some nice revenue from the overseas territories.

Twenty 20, the film produced by Dileep for the benefit of the actors’ association AMMA in 2008, became one of the highest earners in Malayalam cinema. It featured almost every name in the Malayalam film fraternity. Last year, Mammootty and Prithviraj teamed up in Pokkiri Raja, which became a major money spinner. Both the films were scripted

by Siby K Thomas and Udayakrishna, who have no qualms in admitting that they have always stuck to the ‘accepted formulae’ while writing scripts. Christian Brothers, too, has been scripted by the duo.

The basic storyline has been set in a prestigious ‘tharavadu’ called Palamattam. Christy (Mohanlal) is a police informer with great connections in Mumbai, but his family is unaware about his activities. His younger brother Jojy (Dileep) was sent to the seminary to become a priest, but has got out of the fold, after falling in love with a girl. Kavya Madhavan, Lakshmi Rai, Kaniha and Lakshmi Gopalaswamy are the film’s heroines.

Quiz Subair on whether he will attempt more multi-starrers in the future and he says he will decide after knowing about the box-office performance of Christian Brothers. “It is not fair to think about film-making only as a business; it’s actually a passion,” he feels. He believes that the budgets are never a constraint while making profits, if the film has been made well and marketed in a proper way.

Last year Tamil film Enthiran, which had Rajnikant and Aiswarya Rai in the lead, was made with a whopping `150 crore budget but even then it turned out to be a big profit earner for the producers. Quite evidently, it’s not the budget that decides the fate of a film but the merit of the film, reasons the producer.

It is the superstar films that record tremendous initials in Malayalam.

The loyal fan-clubs, often operating with the blessings of the heroes, have some role in making a film run to packed houses at least in the initial couple of days. Prithviraj’s Anwar had fabulous initials, but the producer later claimed that he incurred heavy losses due to its huge production expenses.

With quite a number of high profile projects in the pipeline, the industry is keenly watching the status of Christian Brothers at the cash windows.

Mohanlal has plenty at stake with two high profile projects, RafiMecartin’s China Town and Rosshan Andrrews’ Casanova, at various stages of completion.

If received well, Christian Brothers will have a great season ahead with the forthcoming mid-summer vacations that ensure the presence of family audiences at the cinemas. The worldwide release of the film could start a new trend, if the film manages to set the cash windows ablaze. It’s turning out to be as intriguing as a suspense thriller.

C

hristian Brothers is an experiment in that unlike films in other southern languages or Bollywood, its market has a very limited geographical area. There are around 800 theatres in Kerala, which includes the A, B and C centres.

Generally, the maximum number of release centres for a film has been

around 100 in Kerala. The number of theatres where films get released may vary anywhere from five to 100 or above. Christian Brothers’ 300 comes in here as a break with the past, and an experiment.

According to industry insiders, the average production cost of a Malayalam film could be somewhere in the tune of `1 to 3.5 crore. The remuneration of the artists and technicians amounts to around 40 per cent of the production cost. The general assumption is that a superstar film can recover its cost if it is limited to a budget of `3.5 crore or less.

Though just above 100 Malayalam films were censored last year, which included dubbed movies, the number of Malayalam releases has been estimated at around 70. The grapevine has it that only around half a dozen of these films earned profits for its producers. A few more could have done break-even business and the rest were loss making ventures.

The revenue streams to recover the cost of production include theatre collections, satellite rights, video rights, overseas rights, other language rights and so on. All these could be dependent on the film’s quality and star value, among several other factors. For example, only a few top stars can guarantee overseas business. Of late, the satellite rights have become a major source of income for the producers.

In Malayalam, there is a trend where the satellite rights have been set as per the value of a star, regardless of the merit of a film. This has been a cause of debate of late as new experiments or films with lesser known stars fail to earn good satellite income, even if it earns public acclaim.

Things are different in Tamil and that is the reason why some really appreciated experiments have happened there in recent years.

With their limited viewership, it is a risky proposition to make Malayalam films with a budget exceeding `5 crore. Christian Brothers is estimated to have cost three times the amount

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Health

Know your food Want to stay healthy? Just watch how your body responds to food

H

A P Jayadevan

ave you noticed that eating certain foods causes you to heat up and perspire? And that some foods are easier to digest than others? Healthy eating can be as easy as this; listening to your body and choosing the foods that leave you feeling comfortable.

This is the basic principle of the ancient healthcare system of Ayurveda, which says that “when the diet is wrong, medicine is of no use. When the diet is correct, there is no need of medicine”.

Foods are classified as hot (ushna) or cold (seeta). Hot foods, like spices, chilly, garlic, yogurt, red lentils and honey, stimulate digestive fire. Cold

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foods, like milk, coconut, dill and coriander, will tend to calm and/or slow down digestion. A balance of heating and cooling foods and spices works best, of course. So, you can start experimenting with foods and notice what effects foods have on you. A hot food like chilly or a cold food like milk is easy enough to figure out. An appropriate food item, when eaten, should provide calmness in body and mind.

When the diet is wrong, medicine is of no use.

When the diet is correct, there is no need of medicine: Ayurevda

In Ayurveda, an individual’s diet is based upon his constitution, which is formed at conception and determines the basic physiology and personality.

The prime difference between Ayurveda and modern dietetics is looking at food according to a person’s metabolism rather than according to the nutrient content in the food, which is the latter’s focus.

Food combinations are also important. When two or more items different in taste, energy and postdigestive effect are combined, the digestive fire can become overloaded, inhibiting the enzyme system and resulting in the production of toxins. (The same items eaten separately might well stimulate digestive fire and be digested quickly!)

For example, bananas with milk can weaken digestive fire; so also, sour foods with milk or wheat with gingelly oil. Their post digestive effects are different; bananas are sour and milk is sweet. This causes confusion to our digestive system and may result in allergies.

Acharya Charaka, in his classical text Charaka Samhitha, elaborates some rules for eating: » Food must be taken in proper quantity. Only then does it get well digested, balances the basic energies of body and promotes longevity. So, don’t listen to your tongue; learn to understand the needs of your stomach. »You must not compromise in the quality of your food. » Warm food helps digestion. » If food is slightly oily, it gets disintegrated quickly and digested properly; helps the downward movement of Vata (energy that controls bowel movements), strengthens the senses, promotes strength and enhances your complexion. »Eat only when you feel hungry.

A good appetite indicates that your previous meal is well digested; the

body energies are balanced and the digestive fire is active and ready to receive another course. » Food should be eaten in a calm hygienic place. You may enjoy the moment, but with due respect to your body and your food. Each mouthful of food should be taken with gratitude, because it nourishes you and it provides enough energy to face life’s challenges. » Don’t gulp down your food. » A few sips of water are advised now and then while eating. Do not drink cold drinks just prior to or while eating, also don't drink large quantities of liquid during meals. This weakens digestion. Consumption of excessive hot food leads to weakness.

Cold and dry food leads to delayed digestion. » One should eat with moderate speed, should not be too slow or too fast and should avoid distractions.

Peter Burwash, former Canadian tennis player once said, “50 per cent of what we eat nourishes us and 50 per cent nourishes the doctors.” If we develop a few healthy habits, we can perhaps cut the doctor out of the equation!

Shed your weight

T

hose with a slow digestive function are more prone to weight gain and obesity. They should pay close attention to the quantities of food consumed and follow a restricted diet. Avoid sweets. Nuts, seeds and beverages can be taken three times in a week by those of weak digestion.

They can have fruits and grains every day, with moderate spices. Vegetables and beans also can be taken every day.

It seems unfair, but some people are blessed with a digestive capacity that will let them have junk food and soft drinks for years without a problem! They are most sensitive to sour and acidic foods that increase the pH balance of the body. They may also like hot spices. But they could face problems in the long run. These kinds of foods tend to increase the acidic nature of both blood and plasma. Human cells are very sensitive to the pH level of the body and high acidity breaks down their normal metabolic function. This type of persons should reduce oils, animal products and spices in their diet. It is better to have fruits, vegetables and grains everyday in moderate quantity. They should lessen the intake of dairy, nuts and seeds and vitamins to two or three days in a week.

Some have a varying digestive capacity, and foods that are concentrated and hard to digest should be avoided or taken in small amounts.

They are sensitive to gas forming foods and are also most prone to food allergies due to their variable enzyme function. These people tend to binge and have both a variable appetite and digestion. Hence, they should consume food in moderate amounts and at regular intervals.

The good food guide ■ Have one teaspoon of grated, fresh ginger with a pinch of salt before starting your meal.

It helps digestion and is a good appetiser.

■ Drinking buttermilk with a pinch of ginger or cumin powder after the meal helps digestion.

■ A teaspoon of ghee with rice in the beginning of a meal helps digestion. No wonder our traditional sadyas start this way.

■ Eating fruits immediately after meals will cause a bloated stomach. So, have fruits a couple of hours before the meal.

■ Grains twice in a day are sufficient for those who are not working physically hard.

Either breakfast or dinner can be of fruits, salads, milk etc.

Add grains other than rice and wheat in your diet. They can be millet, barley etc.

■ Try and stick to seasonal, local fruits and vegetables. After all, our land boasts a good, nutritious variety, like pumpkin, leafy vegetables, white gourd, elephant foot, drumstick, radish, raw papaya, jackfruit and banana. Avoid packaged foods.

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Healthcare

The lab at SCMS Institute of Bioscience & Biotechnology-Research & Development; right Dr C Mohankumar, director

Recreating health

SIBB-R&D, Kerala’s sole private research facility in the BT sector, has set a long-term goal for itself Asha Jacob

T

he research team at SCMS Institute of Bioscience & Biotechnology Research & Development (SIBB-R&D) has scored a sweet victory.

It has been awarded with the patent from the Government of India for developing a process for producing Stevioside powder, an alternative for cane sugar and a natural remedy for diabetes, from Stevia or honey leaf plant. SIBB-R&D is the only institute in the private sector in the 48

State with the mandatory approval of the Department of Biotechnology (DBT) for conducting genetic engineering research.

This new process of extraction of Stevioside powder, is not only more economical and reliable than existing international processes, but also produces a higher quality product. Stevioside powder is now extracted using solvents like methanol and ether, traces of which can be found in the final product. SIBB uses water as a solvent, so the product is purer.

Stevioside powder is a natural sweetener which is 300 to 500 times sweeter than cane sugar, but adds only 1/300th of the calories of cane sugar. Its therapeutic properties include activating insulin production and reducing glucose level in the blood, making it a boon for diabetic patients, and also an ideal solution for hypertension and obesity.

The Stevia patent is only a first feather in the

SIBB-R&D team’s cap. They predict that the research centre is set to become one of the powerhouses in India’s BT sector.

So, what is biotechnology or BT? “Biotechnology, the science of 21st century, is the future of mankind,” says Dr C Mohankumar, Director, SIBB–R&D. “It holds the solution for poverty, hunger, malnutrition and insanitation. A state or a country needs to identify its biotechnology needs and invest in the research.

Today, in the biotechnology world, genes can be synthesised artificially in labs.”

BT has applications in four major industrial areas, including medical, crop production and agriculture, in the production of biodegradable plastics, vegetable oil, biofuels, and environmental uses.

In fact, agriculture is seen as the earliest BT activity. Basically, it involves the use of living organisms and bioprocesses in engineering, technology or medicine. The Indian BT sector is predicted to be one of the fastest growing knowledge-based sectors in the country.

Of the 109 institutes that have DBT approval, eight are in Kerala, but the other seven are in the public sector. Started in 2007 with an investment of `7.50 crore, SIBB-R&D has two state-of-theart molecular biology labs equipped for genetic engineering research, which mean researchers can identify, isolate, amplify, clone, sequence, transform and express genes to make proteins, characterise them and study their toxicity. They also conduct pure research on DNA analysis and stem cell technology.

As a backup to the R&D facility, the institute started providing M.Sc courses in molecular biology and genetic engineering, genomics and proteomics, biomaterials and tissue engineering and toxicology under the affiliation of MG University, Kottayam. Moreover, the

"There are many Keralites doing revolutionary research in BT. But they opt for better pay and world-class facilities at foreign universities. We are happy that some of them have expressed an interest in joining SIBB-R&D," says Dr Mohankumar

Interview/ Dr G P C Nayar

“Kerala could see a BT boom” D

r G P C Nair, chairman, SCMS group, is a man with a vision for the education sector. Dr Nair, who set up the first management college in the private sector in Kerala, is also behind the first private biotechnology R&D institution. In an interview, he talks about the past, the present and future of biotechnology and the institution he set up.

Why did you turn to biotechnology?

I read a lot. It enables me to understand the pulse of the education sector. I knew that information technology and biotechnology were going to make it big in the 21st century. IT has grown in the last two decades, and now it is the turn of BT. It is a technology that deals with life and can have a huge impact on the whole of mankind. So we started with a research centre. We started the academic programmes to fund various projects which do not bring in money in the initial phase.

How difficult was life for the venture?

There was a lot of difficulty in getting affiliation for academic programmes as the course curriculum was pretty new. There were no systems to evaluate them. We had to prepare the syllabus, and the university introduced a board of studies to evaluate it. Education Minister Mr M A Baby was very supportive in the setting up of this institution.

How do you visualise the growth of BT in Kerala?

We don’t have many companies working in this field in Kerala, and hence there is a problem of acceptability. Most of our students find work in other states or abroad. But this trend will change. When the whole world is optimistic about BT, we cannot run away. I think the future is bright. A biotechnology park is coming up at Kalamassery.

More players in the field will come to Kerala and I feel there will be a BT boom in the State in the future.

What are your plans for the future?

The institution faces space constraints. If we have to grow, we need to have ample space. We are on the lookout for a new place in Kochi to relocate to.

Have the returns started coming from the industry?

Not yet. Biotechnology is a research-oriented field. So the one certainty about this industry is the uncertainty of when to expect returns!

Profit is not the sole motive behind setting up this institution. I am confident that if we do a good job, the money will follow. We ensure quality education at any cost. We have got together the best faculty here. We have set up the latest machinery and laboratory equipment to enhance research in the area. I believe that a day will come when SIBB-R&D becomes a renowned biotechnology research centre in India.

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MARKET WATCH institute also conducts M.Tech by research and Ph.D, both regular and integrated in all these disciplines. Affiliated to Anna University of Technology, Coimbatore, it is the first of its kind in India.

The students who complete the M.Sc programme can undergo a one-year training in public or private research institutes with the monetary aid of DBT. As with any dedicated research institution, SIBB has been uncompromising on faculty. “We are focusing on generating a group who will pursue BT research in the future,” says Dr Mohankumar.

“Qualified personnel with practical knowledge of BT are very difficult to find, but our criteria makes Ph.D mandatory for teaching staff. Scientists must have a doctorate backed by a minimum of three years experience. Now we have seven scientists, and four research fellows and scientific assistants each. ” “There are many Keralites doing revolutionary research in BT. But they opt for better pay and world-class facilities at foreign universities. We are happy that some of them have expressed an interest in joining SIBB-R&D,” adds Dr Mohankumar.

The SIBB-R&D library subscribes to 40 international BT journals. All this has paid off, according to Dr Mohankumar, who says that Ph.D students complete their research much before the allotted time, thanks to good facilities, guidance, and reference materials.

Says Dr G P C Nayar, Chairman, SCMS group, “Our academic programmes are all highly research-oriented. We focus on research that benefits mankind, and the results of which is affordable to all."

One of the SIBB research team’s big achievements was the development of a diagnostic kit for chikungunya, when the state was in the clutches of the disease two years back.

Notably, the molecular research group at SCMS has developed three gene clones: Lactoferrin(Lf ): The gene for the production of Lf recombinant protein. (Lactoferrin is one of the components of the immune system. It has got antimicrobial activity. ) Omega 3 desaturasegene: Responsible for the formation of polyunsaturated fatty acid, and UGT(UDP-Glucoronosyltransferase): The gene for the production of natural sweetener Stevioside.

While the SIBB’s research is mostly in the areas of therapeutic proteins, or medicinal proteins, which can offer solutions to a variety of diseases, it also focuses on providing vaccines, antigens and antibodies through food.

“Kerala has a large pool of educated manpower,” says Dr Mohankumar. “But sadly, the authorities concerned have not yet decided whether to adopt this technology.”

The achievements of SIBB could well change that.

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Thriving on Chaos T

he Sensex has been on a roller coaster guide in the last three years. From the highs of 2007, it went to the lows of recession in 2009, only to pull back in the following years. In this column, we focus on how companies from Kerala have fared during this period. We have selected four listed banks from the State for this issue.

Federal Bank

Fundamentals Market Capitalisation :`6392crore Face Value : `10.00 Share price on 1 Mar 2011:`364.9 Federal Bank was incorporated in 1931 as Travancore Federal Bank Limited to cater to the banking needs of Travancore Province by a small group of local citizens. It embarked on a phase of sustained growth under the leadership of Mr K P Hormis.

The stock hit a then high of `395 on the BSE on November 19, 2007 and a low of `110.50 on March 3, 2009. It then rebounded to touch a lifetime high of `501 on November 2, 2010. Currently it is trading at around `365(closing price of `364.9 on March 1, 2011). The company had also given a dividend totalling `14 in the past three years.

If you had bought this stock during its lows in March, 2009 you would have made a return of nearly 200 per cent on your investment. Even a person who had bought shares of the bank at its peak in 2007 would not have lost much, if he had invested for the long term and held on to the shares, even though the Sensex had dropped from 21000 to 8000 levels during the period.

Dhanlaxmi Bank

Fundamentals Market Capitalisation :`877crore Face Value : `10.00 Share price on March 1, 2011:`106.10 Incorporated in November 1927 at Thrissur by a group of ambitious entrepreneurs, Dhanlaxmi Bank Ltd. started business with `11,000 as capital and seven employees.

The stock rose to `117.65 on the BSE on January 20, 2008 and plummeted to a low of `37.00 on December 3, 2008. It then gathered momentum along with the market to touch a lifetime high of `212.50 on October 28, 2010.

the ratio of 1 share for every 4 equity shares held on October 16, 2008. Shortly thereafter it hit a low of `4.27 on February 24, 2009. The share price then rebounded to touch a lifetime high of `29.70 on November 1, 2010.

Currently it is trading at around `22(closing price of `21.80 on March 1, 2011). The company had also given a dividend of 10 per cent on the face value in the past three years.

This stock bought during its lows in February, 2009 you would have fetched a return of nearly 400 per cent.

Even an investment in the stock at its peak in January, 2008 would have fetched a return above 20 per cent, considering the bonus share and the dividends.

State Bank of Travancore

Its current price is `106.1, the closing price on BSE on March 1, 2011. It has also yielded a dividend totalling `2 in the past three years.

The stock would have given you a return of nearly 186 per cent had you bought it during its lows in December, 2008. An investment even at its peak price in 2007 would have held its ground, if it was not sold off during the period.

South Indian Bank Ltd

Fundamentals Market Capitalisation : `2328crore Face Value : `1.00 Share price on March 1, 2011: `21.80 South Indian Bank was established at Trichur, Kerala in 1929. One of the earliest banks in south India, it came into being during the Swadeshi movement. The establishment of the bank was the fulfilment of the dreams of a group of enterprising men who joined together at Thrissur.

The stock had a peak of `22.85 on the BSE on January 3, 2008, during the boom. It issued bonus shares in

The bank was incorporated at the erstwhile Travancore in 1945 and became a subsidiary of the State Bank of India in 1960 under the State Bank of India (Subsidiary Banks) Act, 1959.

Fundamentals Market Capitalisation : `3,534crore Face Value : `10.0 Share price on March 1, 2011: `720.05 The stock broke out from the `250-450 range that it was trading in, during the boom period of 2007 and touched a high of `830 on January 4, 2008. Then it slid

to touch a low of `176.1 on March 12, 2009. The stock recovered from the lows in line with the market to touch a lifetime high of `1080 on August 24, 2010. Currently the stock is trading around `700(closing price of `720.05 on March 1, 2011). The company has been generous in dividends and has paid out `47 as dividends from 2008.

A person who had bought the shares of SBT at the peak of the boom in 2007 would be facing a small loss.

But if you had bought the shares during the recession, you would have gained a return of around 300 per cent on your investment.

An investment in any of these companies would have given investors decent returns if it had been held for a sufficiently long period. Even if a person had invested in them at the peak price, the loss would have been marginal. This only goes to prove that success in the stock market is for people who invest in sound companies and are ready to wait the downturns out.

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PERSONAL FINANCE

Link up with ULIPs New-look ULIPs, a lot more transparent than its earlier avatars, are a credible option for the long-term investor

F

irst, there were pure insurance plans. But people did not like these plans as they got no money in return from these plans on survival. Then came endowment plans that combined insurance and investment. There was no transparency in the investments made by these plans and the returns from them were often below par. Finally, came Unit linked insurance policies (ULIPs). ULIPs provide flexibility in investments and transparency to the policy holder.

In essence, a ULIP is a hybrid product, a mix of insurance and mutual funds. The first ULIP in India was offered in 1971 by UTI, the mutual fund house in collaboration with LIC. Subsequently, with the opening up of the insurance sector in 2001, private insurers also started offering ULIPs in collaboration with mutual funds. The tax benefits associated with insurance and the promise of market linked returns, attracted many people to such schemes. But in 2002, the insurance regulator IRDA stopped outsourcing of fund management to asset management companies and unit funds came to be managed by insurance companies themselves.

ULIPs account for a major share of the life insurance business in India. But many grey areas remained in ULIPs, regarding the sum assured, commissions charged, etc. ULIPs, which were regulated by IRDA, had no regulations in place on the amount of commissions that could be charged.

Insurance companies offered hefty commissions—as high as 50-60 per cent in the first few years—to agents, at the cost of the investors.

When SEBI, the capital markets regulator, abolished the entry load on mutual funds which were used to pay

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the commissions of the distributors, the distributors abandoned mutual funds and started promoting ULIPs. This led to a public spat between the two regulators on the issue of regulating ULIPs. The dispute was settled with IRDA coming up with new norms for issuing ULIPs. The new norms provide for an increase in the risk-based insurance portion and a reduction in the high upfront charges. In general, ULIPs will have a large maturity period, larger amount of protection and finally the larger amount of guarantees either in forms like capital returns or interest to policyholders.

The minimum term and lock-in period for the ULIP policies for individuals has been increased from three to five years. IRDA has also set limits to the charges on ULIPs. The difference between the net and the gross yield was capped at 3 per cent for products with a tenor of less than 10 years and at 2.25 per cent for those with a tenor of more than 10 years.

Types of ULIPs Whatever your financial need, be it retirement funds, health, wealth creation or children’s education, chances are that you will find a ULIP to suit your needs.

Unit-linked pension plans ensure a steady income post retirement, in the form of annuities.

Companies have to guarantee a mini-

mum return of 4.5 per cent over the term of its pension products as per the new ULIP norms. Wealth creation plans are ideal for people who are in their late 20s and early 30s and it helps them raise funds to meet long-term financial goals like purchasing a house. ULIPs for children offer money at key milestones of the child's education, safeguarding the child against financial troubles due to the loss of a parent. Health ULIP is a recent innovation in which your premiums are used to build a health fund to meet future health related expenses.

You can also avail of tax benefit on premium paid under section 80D. Designing your ULIP ULIPs are products that combine investment and insurance. They are complex products that offer a lot of flexibility to customers in terms of

Benefits of ULIPs • • • • •

Flexibility in insurance cover, investment amount, fund selection Transparency: through NAV, published daily Liquidity: through partial withdrawal after 5 years Multiple benefits: insurance and investment in a single product Tax benefits

investment amount, term, fund selection, insurance cover required, etc. So it is important that you customise the plan to suit your requirements.

Choosing the insurance cover A ULIP allows you to choose the extent of life insurance cover that you want to enjoy. The new norms for ULIPs have made it mandatory for all unit linked insurance companies to provide the minimum sum assured to the policy holder in case of his/her death. The minimum sum assured will be 125 per cent of the premium for single premium policies. For regular premium policies where the age of the policy holder is less than 45 years, it is the higher of 10 times annual premium and 0.5 times term times annual premium. If the age is above 45 years, Minimum Sum Assured is the higher of 5 times annual premium and 0.25 times term times annual premium.

The upper limit can be as much as 100 times of your annual premium or even higher, depending on the policies of the insurance companies.

Choosing your investment option The ULIP premium that you pay minus the charges is invested in a unit fund. A unit fund is a pool in which the premiums from investors who opt for that particular fund are accumulated. A unit is the smallest division of a unit fund. The money in the unit fund is then invested in the specified asset class. Insurance companies offer a variety of unit funds to investors subscribing to their plans. The main types of unit funds offered are Equity

Funds, Debt funds, Money Market funds and Balanced Funds. Investors have the flexibility of investing their money in these funds, in any proportion that they choose. As the value of the investments grow the value of the units also grows correspondingly. The value of their investment on any day is also known, from the Net assets value (NAV: total fund value divided by the number of units), published by the companies on a daily basis. Investors also have the option of switching the funds in their account from one fund to another at a nominal charge.

ULIPs also provide flexibility in the amount of investment. If you have surplus money with you, you can choose to invest it in your existing ULIP. Such premiums, which you pay over your regular premium, are called top up premiums.

Invest in ULIPs for the long term to take full advantage of the product.

In the short term, ULIPs might not give a good return as the product cost structure is such that the expenses related to product are charged in the initial years. Investing for the long term also allows you to ride out temporary market fluctuations and lets your investment tap the power of compounding.

ULIPs offer a variety of features and benefits that no other financial product does. Features such as top up facility, switch between funds, facility to increase or decrease the insurance cover during the term, cover continuance option even after you stop paying premiums, surrender options and riders that can be attached to the policy are some of them. They have a partial withdrawal option too, that allows you to withdraw your money in case of emergencies.

Death/Survival Benefit: Either fund value or sum assured whichever is higher or the sum assured plus value of the fund units is normally payable to the beneficiaries in the event of risk to the life assured during the term as per the policy conditions. The value of the fund units with bonuses, if any is payable on maturity of the policy.

Tax benefits In India investments in ULIP are covered under Section 80C of IT Act.

Charges associated with ULIP 1. Premium allocation charge: A percentage of the premium is appropriated towards initial charges, commission expenses and renewal expenses before allocating the units under the policy.

2. Mortality charges: The cost of insurance; it depends on a number of factors such as age, amount of coverage, state of health etc of the insured person. This is usually withdrawn from the units available every month.

3. Fund management fee: The fee levied for management of the fund and is deducted before arriving at the NAV. This fee can go upto 2.5 per cent of the total assets in the fund. It is usually higher for equity funds and lesser for debt and money market funds.

4. Administration charges: This is the charge for administration of the plan and is levied by cancellation of units.

5. Surrender charges: The charge levied when you encash the units in the ULIP, fully or partially before the five years.

6. Discontinuance charge: The charge deducted from the fund value if you stop paying premiums on the ULIPs, before the lock-in period of 5 years.

The remaining amount will be transferred to discontinuance fund and will earn an interest of 3.5 per cent per annum till the lock-in period is complete.

7. Fund switching charge: The charge associated with switching the investment between various funds. Usually, a limited number of fund switches are free, with subsequent switches, subject to the charge.

8. Service Tax deductions: Service tax is deducted from the risk portion of the premium.

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SIP by sip Systematic Investment Plans are fast becoming the preferred means of investing in equities for the masses.

“

Buying Low and Selling High” is a sure shot way of cracking the stock market. But it is easier said than done, for lows and highs are almost impossible to predict. Systematic Investment Plans (SIPs) offered by mutual funds are the next best option.

Although they cannot make sure that you won’t buy high, they ensure that you buy more at lows and less at highs.

An SIP is a disciplined approach to investment, much like a recurring deposit. In both these schemes one invests a fixed sum on a regular basis, for a specified period. The similarity ends there though. Your investment in a recurring deposit goes to a fixed deposit scheme and earns interest. But your investment in a SIP purchases units of mutual funds. As your investment is fixed, the number of units that can be purchased will be lesser, when the prices of the units are higher.

Conversely, when the price falls, more units can be purchased using the same amount.

Thus, an SIP ensures that more units of mutual funds are purchased when the price is low and a lesser number is purchased when the price is high - a process called rupee cost averaging. At the end of the period, your portfolio will have more low priced units and fewer high priced units. The average price of the units in your portfolio will be lesser than the average of the market prices of the units in the given period.

SIPs allow you to lower the average cost by taking advantage of the market swings, without having to time or even follow the market. The advantage of SIPs does not end there. The minimum investment required in an SIP is much lesser that that of a con54

ventional investment plan. SIPs are available from monthly instalments of `100/- onwards, making it accessible even to people with low disposable income. This allows people to start investing earlier, allowing them to reap the benefits of compounding. Moreover, it forces you to invest regularly, that too in equities – a class that outperforms other investment avenues in the long term.

SIPs are available in daily, weekly, monthly and quarterly instalments. In addition, investors desirous of starting an SIP have to choose the mutual fund scheme, the regular investment amount, the investment date and the investment period. The amount will be debited from your bank account through post dated cheques or

through electronic clearing services (ECS), so that you don’t have to worry about making the payments on time.

Flexi-SIPs have also been introduced for investors who are unsure about how much they can save each month. It allows investors to increase

An SIP ensures that more units of mutual funds are purchased when the price is low and lesser number is purchased when the price is high.

Systematic Withdrawal Plan s a corollary to the SIP, some A fund houses have come up with Systematic Withdrawal

Plans (SWP). These plans allow unit holders to withdraw money from their mutual fund portfolio at predetermined intervals. Either the amount withdrawn or the number of units withdrawn is kept constant in this plan.

A systematic withdrawal plan has many advantages over a one time withdrawal. It allows the account holder to plan better, as the money is available exactly when it is required. The remaining portions of the units remain invested and continue to grow. The average sale price using an SWP is usually higher than a one time withdrawal. If the growth rate of the portfolio is higher than the withdrawal rate, the plan could provide a steady source of cash especially for retirees. SWPs can also be used for tax planning, converting short term capital gains to long term gains that are taxed at a lower rate.

or decrease the SIP amount midway through the plan. The scheme has been introduced by FundsIndia.com, an online investment platform. With Flexi-SIP, an investor has to choose a maximum investment amount, along with the parameters required for traditional SIPs. The ECS mandate for bank debits will be issued for this amount when the Flexi-SIP is setup.

The investor can then change the value of the SIP instalment, every month.

This value can be any amount between the minimum required SIP amount for that scheme and the maximum set by the investor. The drawback of the scheme is that it allows investors to try timing the market, by varying their investment in SIPs, thereby negating the inherent advantages of the SIPs. HDFC mutual fund has come up with an SIP top-up option, where the

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: Kochi : Monthly : K J Jacob : Indian : Independent Media, XI/173 B, Mulakkampillil Buildings, Kunnumpuram-Civil Station Road, Thrikkakkara, Kochi-682021 Kerala, India : K J Jacob : Indian : Independent Media, XI/173 B, Mulakkampillil Buildings, Kunnumpuram-Civil Station Road, Thrikkakkara, Kochi-6820215. : K J Jacob : Indian : Independent Media, XI/173 B, Mulakkampillil Buildings, Kunnumpuram-Civil Station Road, Thrikkakkara, Kochi-6820215. : The Newspaper is owned by K J Jacob, proprietor, Independent Media

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investor can increase the amount of the SIP instalment by a fixed amount at pre-defined intervals. Another variant that has been offered by fund houses is the value averaging plan.

Here the investor sets a target growth rate or amount for the portfolio each month, and then adjusts the subsequent month’s contribution according to the gain or loss made during the month.

The advantages of SIPs have made people flock to them. According to a BCG-CAMS report, SIPs accounted for 19 per cent of the inflows into mutual funds in the first quarter of 2010, up from 2 per cent in 2005. The report estimates the number of live SIP accounts in India to be around 40 lakh.

58 per cent of them have a regular investment amount lesser than `1,000 which indicates that small investors are taking to the product in a big way.

This shift has required asset management companies to reduce transaction costs, to keep their operations economically viable; a task they achieved by providing subscriptions through the electronic route. With en-

K J Jacob Publisher

try loads for mutual funds becoming a thing of the past, and distributors reluctant to sell them, fund houses have also started selling SIPs through the stock exchanges. These changes have helped them lower their costs to 0.30.4 per cent of the amount invested, compared to the 1.5 per cent charged by distributors earlier. The proportion of subscribers who come in through the electronic route has also increased from less than 10 per cent in 2004 to 97 per cent in 2009.

Advantages of SIPs • • • • • • •

Rupee cost averaging Can invest small sums – from `100 onwards Exposure to equity.

Helps avoid timing the markets Power of compounding Easy to invest Builds a regular investing habit 55

When my information changes, I change my opinion.

What do you do, sir?

John Maynard Keynes (1883-1946) The most influential economist of the 20th century.

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Everybody knows that technology changes business.

Today, the change flows through the net.

And the fact is, Kerala is the most networked State in India.

Of the 978 Panchayats in Kerala, 99% have broadband connectivity.

Information changes

Be updated

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58

BUSINESS CALLED LIFE

V Sivaram

The tsunami that wreaked havoc in Japan impacted human beings across the world. Images of devastation on an unprecedented scale unsettled many. Jaleel, 45, who generally draws various gods or religious symbols, made it his theme this time.

Jaleel has identified walls in popular tourist spots to make his sketches on.

He has travelled to Tamil Nadu, Karnataka and Andhra Pradesh with his colour chalks, and has earned admiration, as well as the moolah. “On a good day, I get about `350 a day,� says the man who has been practising this art form for the last 25 years. He paints banners, posters and hoardings during off season.

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