Jan 15 feb 15, 2016

Jan 15 - Feb 15, 2016

PASSLINE

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Events

In connection with the 30th anniversary of Moolans Group, its philanthropic wing Varghese Moolan Foundation under `Hridaya Sparsam’ scheme and in association with Amruta Hospital is introducing a scheme of Rs 1 crore for free heart surgery and various other treatments of children below 16 years . Photo shows Varghese Moolan handing over the first instalment cheque of Rs 50 lakh to Amruta Medical Director Dr Prem Nair in Kochi.

Anoop Jacob, Minister for Food & Civil Supplies handing over, the key of Hyndai I 20 car to Jibi, Vaduthala, the winner of ‘Drive your Dream’ contest jointly organized by Eastern Condiments & Lulu Group. Krishnakumar Menon, Head- Procurement, Eastern, Kruthika, GM- Sales, Vinod Nair, Head- Logistics, Eastern & Sudheesh Nair, GM, Lulu Hypermarket are also seen.

Sushil K Satpute, Director, DIPP, Govt of India, addressing the gathering in Kochi in connection with Make in India Road Show.

K G Ajithkumar, General Manager, KSIDC, AK Nair, Past chairman, CII Kerala & Saji Mathew, Dy. Director, CII Kerala Chapter are also seen.

3 From the Editor

Is the sheen of Road Safety Week dim in these days?

Road accidents are very common every were in the world but a process that kills 380 people in a day must be considered as the gravest of the public emergencies.

According to available data, Indian streets are witnessing 380 deaths in a single day.

Does our law makers initiate any measurers to address the bloodbath? I think it is the apt time to assess our priorities in this issue as we celebrated the Road Safety Week in our country from January 10 – 16th.

Editor & Publisher

Varghese Paul Kozhikode Vineeth Mukundan 8714986177 Chennai Augustine Joseph Ph: 09381000534 Bangalore Gireesh Gopal +91 7204560000 Adithya +91 9538060591 54, 2nd Main, Vyalikaval Bangalore - 560003 Manager-Marketing Sajan K 09895344485 Keethara Publications Pvt Ltd 38/125 1st Floor, Narakathara Road, Kochi-682 035, Kerala, India. www.passlinebusinessmagazine.com E-mail : passline.com@gmail.com

No doubt that our lack of road safety is a problem that affects every section of society. Just in 2014, close to 1.5 lakh were lost in Indian roads and another 5 lakh people were injured. Apart from human loss, our erstwhile Panning Commission calculated that as much as 3% of our GDP is lost annually due to the road accidents. It is imperative to check whether the Road Safety Week itself is contributing any meaningful solutions to the problem. The nature of activities planned usually during the Road Safety Week is such as distribution of promotion materials and organisation of series of competitions for children and adults. Nothing concrete or creative things are taken place. After the end of a week long celebrations, people will be in oblivion about the road safety either till the major accident occurs or the event celebration in the very next year.

We cannot ignore the good intention behind the organisation of Road Safety Week and it is certainly appropriate to have a designated period of time if we as a society can use it to engage in remembrance of road accident victims, and focus on discussions of the systemic policy gaps that the road transport system in India suffers from. But that should not stop us from taking a hard look at whether the current form of the Road Safety Week is having a beneficial impact. We should ask ourselves whether we can not do something more ambitious, more pragmatic to deal with a problem as severe as this.

Foot Note.

Kerala is the one of the foremost state as regards the road accidents and casualties are concerned. Thanks to anaemic, bumpy roads and also burgeoning number of vehicles. In most of our houses have at least two luxury four wheelers and minimum a two- wheeler. We can not blame them because Keralites have the highest per capita income in the country and it is quiet natural that they will have large sum at their disposal to splurge. Let us be optimistic that after the commissioning of Metro Rail and other proposed rapid transport systems our road safety will improve and the traffic jam among our roads will drastically vanish.

Varghese Paul

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K

erala has a highly intelligent population,well e d u c a t e d and skilled P.C.Cyriac,IAS(Retd) and capable of working hard. And with the early achievements in education,especially women’s education, our families attained a high level in hygienic living. This in turn improved the health of our people and led to a good quality of life here, as evidenced by our very low infant mortality rate and the pregnant woman’s mortality rate. When the woman found that her infant child could be safely brought up into adulthood,she developed the confidence to undergo sterilization after one or two pregnancies. This brought down the birth rate and life became less hard for the common people.

And the successive State Govts in Kerala were implementing land reform measures which though did not make every tiller of the land it’s owner, made him own PASSLINE

Jan 15 - Feb 15, 2016

the 10 cent plot of land where his homestead stood. Simultaneously strong trade unions also came up, making the working class aware of it’s rights,preventing exploitation and assuring fair wages. In these circumstances, Kerala which is blessed with fertile soil, plentiful rainfall and 360 days of 12 hour sunshine should have prospered as a great agricultural economy, growing a large variety of crops.

But the farm workers in the paddy- belt became unionized under leaders with little vision and the farmer could not fight their militant brand of Unionism. Meanwhile the “gen next” of the paddy workers chose to go for better options, creating scarcity in the farm labour market. The Trade Unions opposed mechanization as well and with the Governments failing to discipline the farm unions, the decline of Kerala ‘s agriculture became inevitable.

The State had successful traditional industries like Coir, Cashew and Handloom textiles, but

the failure to inject in new technology at the appropriate time led to their debacle also. Though a host of new high tec industries had come up in the 1940’s ( the most prominent amongst them,FACT ltd of Udyogmandal),they also could not sustain their growth tracks on a long term basis.Again , militant trade unionism was one of the major factors ,stunting their growth. With all this, people started talking that Kerala is not the place where entrepreneurs can safely invest their money and build up ventures. So the Government started thinking that Kerala was surplus in electricity and started selling the power generated by our Power Projects to the industries in Tamilnadu and Karnataka.With this the days of steady growth of our Power sector ended. And Electricity, a very important infrastructural facility got relegated to the background.

Years later, by the time we realized that Kerala needed more power projects and more electricity, the conditions had become unfavorable and nobody would

accept more forest areas getting submerged in the new Hydel Reservoirs. Setting up new thermal power projects would entail the logistic problem of transporting a huge quantity of coal from Eastern India( mostly from Orissa), apart from the releasing of CO2 gases by the burning coal. Thus for the most essential infrastructure of electricity, Kerala started.

Depending on power purchases.

Another major infrastructural bottleneck Kerala encounters now is in Transportation. Though we make use of all modes of Transport, like water, road, rail and air, we are woefully constrained as the available facilities are inadequate. Kerala, the land of three million emigrants and their remittances, certainly needs one more good airport, between Trivandrum and Nedumbassery.

And the enormous potential that Kerala has got in Water Transport has not been tapped at all. While the authorities of the Cochin Metro Rail Project are trying to get a Rs 700 crore water Transport Project implemented in Kochi,

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at an outlay of Rs 700 crores, the plans for de-bottle necking the National Waterways and make them usable are making no progress.

As far as Road Transport is concerned,the problem has become very acute as the number of vehicles on the road is multiplying fast , while the road space is remaining the same. Land acquisition is the biggest problem here, as people are reluctant to part with their land.and the cost of the land required for our National Highway development is estimated at rs.35000 crores. While this is not a viable situation, we have to find an innovative solution for this problem. For widening an existing road, we acquire the land on either side of the existing road, thus removing the people who enjoy the road frontage . They are forced to leave their land, often getting a below the market price.

And the people owning the plots behind, suddenly are blessed with the good fortune of becoming owners enjoying the frontage of the new developed road! And with no effort and at no price !

This problem can be easily solved, if we acquire more area and rehabilitate all persons who lose their lands there. For example, if we have to build the road at 45 m width, acquire 90 m width and form the road in 45 m and use the remaining 45 m width lying on either side of the developed road, at 22.50 m each, for accommodating all those people whose lands were acquired, each of them getting areas with road frontage with land area being equal to half the area they have lost. Once this prize patch of road frontage is assured they will cooperate and land acquisition will become easier and cheaper.

As far as Rail transportation is concerned,, Kerala has problems.

But without appreciating the real problems, But without appreciating the key issues the Government and our politicians are raising demands which are not relevant. What will Kerala’s transportation sector gain by agitating against the splitting of the Palakkad Division or abolishing the post of a Chief Administrative Officer?

What Kerala should demand is the doubling of the entire Railway line between Mangalore and Trivandrum and it’s electrification and installing the most modern signalling system , all within a year’s time. Then let us ask for trains which will run between these two stations every half an hour , in both directions. Let our buses run as feeders to the Railway Stations.Once this arrangement stabilizes, we can examine the feasibility and need for the grandiose Rupee one lakh crore project of the Ultra fast Rail Corridor between Trivandrum and Kasergode for covering this distance in four hours!

Another important infrastructural facility is water. We have many perennial rivers and we have set up many river- based water supply projects. But due to our inefficiency we are not able to provide safe drinking water to all our habitations round the year. Let us not take up any more pipeline based and river based water supply projects. Instead, let us concentrate on improving the maintenance and upkeep of every existing Watersupply scheme. Let our pipes stop leaking and let our motors and pumps perform at the rated capacity. Let us stop the rampant theft of water. Thereafter launch a Project for harnessing the rain water in every household of Kerala in every water- stressed habitation.This is the feasible solution

in a State where the average rainfall is more than 200 centimeters and where the interval between two showers is never more than three months. Install 6000 litre capacity Sintex type PVC tanks in every household ,where the householder is willing to meet 50% of the cost,which will be not more than rs 5000/- per family, once a centralized purchase for a huge quantity of tanks is transparently made. Let this tank collect the rain water from the roof of the house. The water required to meet the drinking and cooking demand of a person per day is estimated as 10 litters. So , for a five member family, the water required for these purposes for 100 days will be 5000 liters only. With the frequent rains in Kerala this tank would remain full always and more water can be drawn.

In respect of the other infrastructural facilities also, think of such simple and cost- effective and practical solutions and remove the bottle necks. Instead of doing this, Kerala is creating more and more Public Sector Undertakings for strengthening the infrastructure! Already we have got many Corporations like Kinfra and Inkel for infrastructural development. Now we have formed RICK ltd, Road Infrastructure Company of Kerala,KIIDC, the Kerala Irrigation Infrastructure Development Corporation,KTIL, the Kerala Tourism Infrastructure Ltd, are some of them.

Kerala is not financially strong and we are never able to provide enough funds in the Budget for infrastructure after meeting our regular commitments like salaries, interest etc. The only hope for infrastructure is by attracting private investment. For this, the Govt must make a deliber-

ate attempt to present an investor friendly face. By our actions and fresh policies we must infuse confidence in the investors that their money would be safe with our Govt. For this , the ease of doing business has to improve.

Recently in a World Bank study, Kerala was ranked at 18th among all the Indian Staes on the basis of the ease of doing business index.A very disappointing news.

Instead of making sincere efforts to change and simplify our complex systems and procedures for giving clearances and approvals, the Kerala Govt spokesmen have haughtily asserted that asserted,” Kerala has willfully decided not to compromise on inclusive growth and environmental security. The planners are not particularly worried about the State getting a low rank in ease of doing business index . The State’s growth rate is pegged on the ‘start up revolution’ and the buoyancy in the Medium and small and micro enterprises (MSME)sector”. One is dismayed to find our powers that be dismissing the 18th rank as of no consequence. Who is asking you to compromise on inclusive growth or the environment? Kerala which depends on a steady and copious flow of private Capital for its infrastructural development cannot afford this casual approach to the concept of ease of doing business. Deliberate efforts , both at the bureaucratic and political levels , are required if we have to change our tarnished image and make us really business friendly. Even for the growth of the Start ups and the mSME sector business friendly government is a must. The earlier we realize this truth, the better it will be for Kerala’s infrastructure.

Jan 15 - Feb 15, 2016

PASSLINE

OVERVIEW

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Will lotus bloom by Modi – Shah

B

JP has no hopes whatsoever in West Bengal: It has chosen Kerala as the focus for its cruK Vijayachandran sade against Left.

It has struck a deal with Vellappalli and his SNDP in Kerala with the main objective of defeating both Fronts. Kummanam Rajasekharan , the new Chief of Kerala BJP, has gone on record that his immediate objective is taking over State power and not simply opening an account in the Assembly. Unlike many other RSS leaders of Kerala, driven by principles and ideologies, Kummanam seems to believe in the Godse doctrine of end justifying means; considered a monopoly of Communists.

He was discovered and chosen by the Modi-Shah leadership of RSS from Gujarat that had created history in the Parliament elections of 2014 by using the most modern tools of corporate planning and marketing tactics. Local leadership was bypassed or virtually kept under suspension and Modi-Shah team assumed full charge of party organization in UP during the elections. Take over in Kerala, by Kummanam, was a similar operation and it shows the seriousness with which the Kerala assembly election is looked upon by the Modi-Shah leadership.

The recent setback suffered by BJP in the assembly election for Bihar and few other states does not belittle the significance of the quantum jump it registered in the 16th general elections (2014). In PASSLINE

Jan 15 - Feb 15, 2016

the 15th general elections (2009), nearly 37 per cent of the electorate did not vote but, BJP could win 10.9 per cent of the total votes and 22 per cent of the Lok Sabha seats. In the very next general elections, nearly four per cent more of the voters had abstained; but BJP could doubleup its votes-share to 20.6 per cent and more than double-up its seats-share to 282. We will examine, later, how BJP managed to engineer this miracle by exploiting some of the basic weaknesses in our election system.

The Modi-Shah team of RSS was in a hurry to take full advantage of this quantum jump in BJP’s electoral performance and consolidate its position within BJP, by implementing its own sectarian plans and priorities including the Temple-Mosque agenda.

Elections for the state legislatures, last year, were seen as a big opportunity for this. They tried all possible means, fare and foul, to win Bihar but were snubbed as Baharis by the Bihar people and Lalu-Nitish team had a clear walk-over. BJP could do well in Haryana and Maharashtra in assembly elections but could not impress the voters in Jharkhand, Orissa and Delhi.

These electoral setbacks as well as the stiff resistance encountered in the Rajya Sabha have now unnerved the Modi-Shah team.

Modi Government that had promised to be guided by the principle of cooperative federalism was not prepared to respect the majority views of the Rajya Sabha.

Modi has even re-christened India’s Planning Commission and now the National Development Council, the constitutional custodian of national planning in the country, is sought to be abolished by hook or crook.

Now, assembly elections for the five states—Kerala, West Bengal, Assam, Tamil Nadu, and Pondicherry are scheduled for the next season, by the middle of the year. Under the present political circumstances and economic environment, these elections are of crucial importance for the BJP and its Modi-Shah leadership, and state-wise strategies are being worked out in all possible details. Aruvikkara was a convenient test-bed for perfecting its tactics and strategy for the Kerala assembly elections. Even with the high-profile candidature of Rajagopalji and the advantage of being the ruling party at the

Centre, BJP could muster the support of only 18.4 per cent of the electorate, an improvement of 11.8 per cent compared to its performance, five years ago in 2011.

Of course there was erosion in the vote base of UDF as well as LDF; and BJP had made gains.

But these losses and gains were not commensurate with the fall in prestige of the two dominant political formations. That was why the Modi-Shah leadership decided to assert itself by bringing in a lesser known RSS leader, Kummanam, to act on its behalf on the non-conventional line that was tried out in UP elections--2014.

Let us have a closer look at how BJP achieved its miracles in UP, credited to the ModiShah team: Based on the numerous press reports analysis of those days I had published in May 2014, a blog on this miracle: Quoted below are extracts from this document: https://kvijaya40. wordpress.com/2014/05/21/239/ “BJP’s best record in UP was 57 seats and that was in 1998, when it polled 36 per cent of votes. And the vote share has been declining in subsequent Lok Sabha polls. In the last State Assembly elections its vote share had touched an all time low of 15 per cent. The big story of how this trend was reversed with a little bit of corporate planning (and corporate resources!) as narrated by Amit Shah, 49, a professional business planner and BJP boss of UP was reported in the Economic Times of May 18…

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antics in Kerala ? …BJP had not contested panchayat or cooperative elections in the state for nearly two decades and according to Shah, BJP had little or no contact with influential people at the gram pradhan level. At the district level SP and BSP leaders were more popular than those of BJP. In fact, his party had to be built up from the bottom: To reach out maximum people in a short time, Shah conducted programs in 13,000 college campuses to register volunteers. In fact, Rahul Gandhi had started such exercises on similar lines, inspired by modern management methods. …Shah had assembled an 800strong volunteer corps under him, largely from fresh recruits, and they were equipped with 450 GPS-installed Modi vans with campaign material and a 16 minute video. These squads were dispatched to the remote villages, or the so called dark zones in UP -areas that do not have access to any form of media. Local leaders had initially resisted these moves but they could be easily won over by the superior corporate culture….

….For electioneering the eighty constituencies were divided into eight zones under which there were twenty two clusters, each cluster having three to five constituencies. There was a strategy for the state as whole, then for the zones and clusters and finally for the specific constituency. Shah and his team drafted a four-level corporate-style detailed plan for maximizing the number of seatwins under the given socio-political environment and resources position. ….Based on ‘social engineering or social equations’ largest chunk, 28 out of 80 tickets were given to OBCs, 19 to Bhrahmins and 17 to Thakurs. Tickets were also given to representatives of backward communities such as Nishad, Bind, and Khushwaha who don’t dominate a particular constituency, but are present in large numbers along the Ganges to help consolidate (caste based) votes across constituencies.

There are no reports on any Muslim candidate being sponsored by BJP.

…Shortly after taking charge, Shah conducted day-long meetings in groups with the party’s MLA and MP candidates who had lost elections previously to know the reasons for their defeat…. for it was more important to know why they lost elections.

Shah carried out extensive due diligence before finalizing names and was ruthless during ticket distribution.

….That was how BJP launched a well planned campaign against caste-based politics in the 16th Lok Sabha polls in UP. And, results were spectacular: BSP with its SC + Brahman base, despite polling nearly a fifth of the votes polled, did not get a single seat!

SP of Yadavs and Muslims got only five seats, despite polling more than 20 per cent of votes.

Congress polled 7.5 per cent votes and could return only Sonia and Rahul!”

…The criteria was simple: deny tickets to those who had contested and lost in the past, since lack of success was evidence of their unpopularity. Preference was given to local aspirants who were easily approachable.

One may argue that Kerala is different from Gujarat or UP. But RSS ideology of upper caste Hindus was at work for long years in Kerala as well, and even during the freedom struggle: RSS violence against the Trade Union

Movement in Mangalore Ganesh Beedi is part of pre-independence history of Malabar. RSS ideology had played a part, not only in the suppression of Punnapra-Vayalar struggle against the move for an independent Travancore, but also in the peaceful launch of Hindu Maha Sabha in the early fifties.

Left in Kerala had a role in all these and was always at loggerheads with the local RSS ideologues.

The Left had taken Narayana Guru to the people, using their own class based organizations, while the rich among the upper caste Hindus including the big land-owners among Ezhavas built caste based organizations like SNDP or NSS. Land reforms initiated by the Left and continued by the others have completely changed the social and economic fabric of Kerala: Today, nearly everyone in Kerala belongs to his or her class organization, union or trade association and the tens of thousands of Hindu gods, big and small, were liberated from the stranglehold of upper-caste Hindus and rehabilitated by grass-root level people’s movements.

Every one of the 140 assembly constituencies in Kerala has a dozen or so institutions in the name of Narayana Guru: Schools, colleges, polytechnics, engineering colleges, medical colleges, hospitals or social welfare and charity organizations. They are not under the central command of SNDP but are generally owned or managed by upper class Ezhavas and look forward to receiving financial and institutional support and patronage from State as well as Central governments.

A local RSS leader like Kummanam could naturally broker deals

for such non-governmental organizations, bypassing the already existing political channels and even local Government. Sree Narayana Jana Vedi (SNJV),(Bharat Dharma Jana Sena) now floated

by Vellappalli on the SNDP platform could be used for mobilizing the resources such NGOs at the command of upper caste Ezhavas, for electioneering as well as for bartering of votes. Such models could be copied even by other communal formations of Hindu, Muslim and Christian.

It is a well known fact that caste and community- based NGOs dominate the social welfare sector in Kerala and it will continue to be so, until the elected governments at the local level pick and develop these capabilities. Possibly, Modi-Shah leadership of BJP has discovered this soft underbelly of Kerala: Rajan Babu and even Vellappally are their early victims!

And, women power has largely contributed to the fairly big win of LDF in the recent local body elections in Kerala and BJP is sure to catch up: All these could be used by the Modi-Shah team in drafting “corporate-style plans for maximizing the number of seat-wins under the given sociopolitical environment and resources position”, as in UP-2014.

True, Kerala is not UP and BJP has its limitations in making a long-term impact on Indian polity. But it could easily win half a dozen or more seats in Kerala elections, leading to a hung assembly and temporary political instability. And, that would turn out to be a pleasant healthy break that is long overdue in Kerala politics.

(The views expressed by the writer is his own) Jan 15 - Feb 15, 2016

PASSLINE

FOCUS

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Where to invest in 2016 ?

Invest in FDs, but there are other options too

Dr V K Vijayakumar

T

he global economic environment is tough. 2015 was the worst year for global economy after the financial crisis and global recession of 2008. Going by the present trends, 2016 is likely to be very challenging. Commodity prices, particularly crude, have witnessed one of the worst crashes in history. U S interest rates are northbound with huge implications for capital flows and the global economy. The Chinese slowdown has the potential to impact global growth in 2016.

Where will investors invest in such a difficult environment?

Amidst the global gloom, the Indian economy is doing reasonably well: in a relative sense, that is. Even though data tells us that India is growing at around 7.5 % and is, therefore, the fastest growing economy in the world, the state of the economy is far from benign. There is huge excess capacity in many industries such as metals and, therefore, the private capex is dismal. The banking system with stressed assets in excess of 11 % is in very bad shape. The huge crash in the market cap of PSU banks is a reflection of the poor state of affairs of the banking industry. This is likely to be a major constraint in India’seconomic recovery. The continuous decline in exports during the last 12 months is another constraint that might impact growth, going forward. In such a challenging environment, investors will have to be cautious.

PASSLINE

Jan 15 - Feb 15, 2016

The lion’s share of India’s financial savings goes into bank deposits. Since bank deposits are safe and not risky, investors should continue to invest in bank deposits. But it is important to note that the returns from bank deposits are declining due to reduction in interest rates. Interest rate on one year fixed deposit has declined by around 1 %. This trend is likely to continue. Therefore, investors may now consider other asset classes that yield better returns.

Investment in debt mutual funds is an attractive investment option.

The level of awareness about these products is very low.

Debt funds are attractive Debt funds yield good returns when interest rates are trending down. The superior returns are due to the rising price of bonds.

(Bond prices move inversely to interest rates.) People who need regular income may consider MIPs (Monthly Income Plans).

These are debt funds that invest around 80 % of their corpus in high quality bonds and debentures. The balance 20 % is invested in blue chip stocks that give superior returns in the long run. MIPs like HDFC MIP, RIL MIP, ICICI Pru MIP, Birla Sun Life MIP have given annual returns above 9 % during the last 5 years. Apart from yielding superior returns, MIPs are highly taxefficient. The long-term tax rate (if held for minimum36 months) is only 10 % without indexation and 20 % with indexation. The deflating is done using the CPI index. Investors in the high-income bracket will benefit substantially from investment in debt funds.

Gold losing its glitter Gold, which gave excellent returns during 2008-2012, is a poorly performing asset class now.

Return from gold has been negative during the last three years.

With US interest rates firming up, gold is unlikely to perform well in 2016, barring unforeseen geo-political issues, which might ignite safe haven buying in gold.

Therefore, only a small part of the investible funds should be invested in gold. Those who desire to invest in gold may opt for the gold bond scheme yielding 2.75 % interest. Here, there is the risk of price decline.

Short- term headwinds for real estate Real estate was another asset class that gave very good returns during 2004-13. Real estate is not a standard asset; it is location specific. Therefore, returns vary. Liquidity is a major problem now.

Though investment in real estate can yield superior returns in the long term, the prospects are not bright during the short to medium term. The industry is plagued by excess supply and weak demand.

The rental yield from property is too low to sustain the present level of prices.

Stocks: volatile but attractive This brings us to the stock market. The stock market yielded excellent returns in 2014. The Sensex and Nifty appreciated by 29% in 2014; mid and small cap indices appreciated by more than 50 % and 60 % respectively. But in 2015, stock market disappointed with a Sensex return of - 4 %.

Market performance in 2015 was impacted by many external and internal headwinds: Externally, the Chinese slowdown and Yuan devaluation impacted global financial markets. The commodity crash severely impacted commodity exporters and global trade.

Global GDP growth was muted in 2015 at 2.9 %. FIIs, particularly SWFs (Sovereign Wealth Funds) of countries reeling under crude crash, sold continuously. Inter-

nally, the second consecutive poor monsoon impacted agriculture and rural spending. Excess capacity in many industries constrained private capex. Reforms like the passage of the GST Bill did not go through. All these factors impacted the market.

Invest through SIPs Presently the market is weak.

The benchmark indices are down more than 17 % from March 2015 highs. Sustained FII selling is the major reason for the weakness in the market. Even though sustained FII selling is an area of concern, the Indian stock market has the potential to yield superior returns, provided investors have a time horizon of three years.

There is a consensus today that India will be the fastest growing economy in the world for many rears to come. Among emerging markets India is the most stable and the most promising. According to many think tanks including Harvard research, India is likely to emerge as a $ 10 trillion economy by 2030. By then, India’s stock market will multiply several times, creating phenomenal wealth.

The best way of participating in this coming wealth creation is to invest in stocks. It is difficult to predict the returns from stock market in 2016; but there is no doubt stocks will beat all other asset classes from a medium to long- term perspective. This is the lesson from the financial history of the last 100 years. Therefore, an ideal investment strategy would be to invest in stocks through the mutual fund route.

Investors should opt for Systematic Investment Plans (SIPs).

Long-term investors should give the highest weightage to equity in 2016.

(V K Vijayakumar is Investment Strategist, Geojit BNP Paribas)

WOMAN POWER

9

Shikha Sharma’s pragmatic approach scripted a success story for Axis Bank

U

nder Shika Sharma Axis Bank has taken the lead in focusing on technology, which has now become core to almost every other lender’s strategy.

The focus on retail has allowed Axis Bank, among other private sector lenders, to report doubledigit growth in advances every quarter. This comes at a time when the banking industry has been struggling with single-digit credit growth. In the quarter ended September 2015, the bank’s retail advances grew by 27 per cent, whereas overall advances were up 23 per cent.

When Shikha Sharma took charge as top notch person of Axis Bank in April 2009, the view outside must have been cloudy.

In the aftermath of the Lehman crisis, global growth was on the decline and stock markets had nosedived.

The view inside the country’s third largest bank wasn’t very clear either: Sharma stepped into the shoes of P J Nayak, who had quit the chairmanship prematurely, after pitching for an internal candidate as managing director and CEO instead of hoisting an outsider. There was obviously heartburn among a section of employees at the decision to appoint her to the top job.

The challenging times that Sharma faced in handling a new organisation took a year and a half down the line, when the bank decided to acquire Enam Securities.

This deal came at a time when the stock markets were not doing well, earning her the ire of the investor community. Another feather in Sharma’s cap is the rich dividends reaped by the bank from the Enam acquisition.

However, five years later everyone - from the stock markets to analysts – praised the way she has managed to steer the bank, which primarily had a corporate lending and retail liability portfolio, into a full-service, end-toend financial institution focused on sustained profitable growth.

There are several reasons for this: the bank’s compounded annual net profit growth rate has been above 20 per cent in the last three years. The return on assets has been an impressive 1.83 per cent,

and all this while it has managed to keep the proportion of net nonperforming assets to advances at 0.46 per cent, at the end of March 2015.

According to the Bloomberg debt market league table for FY15, Axis Bank topped the list with a 17.7 per cent market share and handled 313 issues, handsomely beating its closest competitor.

On the equity side, the bank has managed to get into the top 10 list, giving confidence that the Rs 1,400-crore deal was worth it.

Sharma is credited with taking the plunge into retail at a time when most banks decided to reduce their focus in this segment in the wake of the 2008 global financial crisis, which left them with high stress in the unsecured lending portfolio.

Even this bet seems to have paid off. The share of retail advances increased from 27 per cent of total advances at end-March 2009 to 40 per cent at end-March 2015.

The share of corporate advances declined from 51 per cent to 45 per cent, while the proportion of SME (small and medium enterprises) loans to total advances fell from 22 per cent to 15 per cent in the same period.

In the July-September period the banking industry as a whole witnessed just 9.5 per cent credit growth. Sharma says the decisions she took were only a part of calculated risk-taking. For example, the bank did choose retail at a time when others were shying away from it, but always maintained a cautious approach.

“We didn’t actually go in the open market and start doing retail lending, instead we focused on cross-selling to existing customers and that is what worked,” she explains.

ing to build as an institution to offer more products to our existing customers.”

Under Sharma Axis Bank has also taken the lead in focusing on technology, which has now become core to almost every other lender’s strategy. As a result of this focus, Forrester Research had rated the bank’s mobile application as the topmost in the banking industry. This evaluation was done on the basis of a range of touch points, enrolment and login, account information, transactional functionality, service features, cross-channel guidance, marketing and sales.

In her understated way, Sharma admits she had initial difficulties in understanding a new organisation and a new business. “The first two years were difficult for me, but once you understand that, then the change itself is pretty organic,” she says.

S i m i l a r l y, many people describe the Enam acquisition as a bold move. But Sharma says it wasn’t such a big acquisition, involving a stake dilution of only some 2.3 per cent. “It wasn’t that we went ahead and made a big bet. It was consistent with what we were tryJan 15 - Feb 15, 2016

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INTERVIEW

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very volatile and unpredictable.

In cake processing the profit margin is very high at times when the oil prices move upward above Rs 100 /kg. There will also be adverse situation in segment when the oil price is below Rs 100 / kg and cake price moves upward abnormally, due to scarcity. We manage this by a procurement policy with a suitable mix of local and import content.

First quarter of fiscal 16, your sales growth remained stagnant and the profit dropped by almost 25% on yearly basis.

How do you attribute this?

K

erala Solvent Extractions Ltd, now known as KSE Ltd, is a public limited company and is the largest manufacturer of compound cattle feed in the private sector in the country. Since five decades, KSE has been showing tremendous growth under the stewardship of various personalities in Irinjalakuda, especially the incumbent Chairman and Managing Director (CMD) M C Paul. It is to be noted that the multilevel diversification, as elaborated underneath, has taken place under the vast experience and farsightedness of CMD Paul that KSE has trodden the rough road to success. It so happened that Passline passed through the records of accomplishments of KSE and has interacted with the CMD. Edited excerpts: How do you assess KSE after 5 decades of its inception?

It was in 1963 that KSE entered the Solvent Extraction Industry, setting up the very first solvent extraction plant in Kerala. Then in 1976, a new plant was set up to PASSLINE

Jan 15 - Feb 15, 2016

manufacture ready mixed cattle feed. KSE has around 5500 shareholders and shares are listed in Bombay Stock Exchange (BSE).

The company is the largest manufacturer of compound cattle feed in private sector in the country.

The last three decades have seen KSE emerging as a leader in solvent extraction and ready mixed cattle feed in the country. Today KSE commands the resources, expertise and infrastructure to manufacture a range of livestock feed in high volumes, coconut oil from coconut oil cake and refined edible oil.

stretching across Southern India. Since the early days, KSE has endeavoured to supply its products to customers through an extensive network of dealers and retailers, which form a dedicated force behind the success of KSE. It is a matter of pride that KSE is a household name today. With a strong commitment to customers and product quality and being cost competitive, KSE stands poised to meet new challenges.

KSE has also entered in the field of milk procurement and processing. KS Milk, KS Ghee and Vesta Ice Cream have become popular in many districts in Kerala.

Driven by a commitment to high standards of quality, KSE has not only won customer confidence but also national recognition through several awards and accolades.

The revenue of KSE is from three segments viz. Animal Feed, Cake processing and Dairy. Animal Feed brings in 83 % of revenue, cake processing contributes 13% and Dairy around 3 %. In the short span, Animal feed is the core area followed by cake processing. In the long term perspective we aim to push forward Dairy segment wherein the margin is better and steady. In animal feed division the margin is thin and profit is earned out of volume. However, the margin in Animal Feed is

With modern manufacturing facilities spread over three states, KSE caters to the vast belt

You said KSE consists of 3 divisions, can you elaborate the revenue share of each divisions?

As discussed earlier, our main revenue comes from Feed business. Last year the growth in volume of feed sales is around 10 %. If you analyse the growth of feed business, after a considerable growth in a particular year, the growth for the next two or three years will be almost flat and the growth is consolidated in the said period. Further, two solvent plants of the Company were under annual maintenance, for about one month during the first quarter which had affected the performance of that division slightly in the first quarter of FY 16.

The main business of the Company, that is of animal feed, is operating in a very volatile environment. The working results of any period are dependent on the market prices of major ingredient like Rice bran, Maize and de-oiled cakes. As all these are agricultural commodities, and the market rates for these are ruled by many factors such as monsoon rain, change in the agricultural pattern by the farmers, yield in

11 ity for a considerable growth.

Where do you see KSE 5 years down the line in terms of value, volume and growth? near future?

We will be adding more varieties of ice cream to suit the customer taste. However, we are not planning any fresh line of business at the present moment. We wish to remain in the business, where we are strong.

How do you plan your capital expenditure for the next couple of years?

We do not have much capex plan in the short term. The volume of animal feed we will be adding through third party production arrangement, where in the capex is almost nil. In the other two business we have enough capac-

KSE have crossed 50 years and that too in a turbulent political atmosphere offered by Kerala.

The strength of KSE is collective decision making and professionalism in all areas of operation.

Transparency in all operations and decision making without any hidden personal agenda brings out the best out of us. KSE will always hold this policy above all and we expect that the volume of animal feed will touch 6 lakh tonnes per annum and the turnover will reach Rs 1500 crore in the next few years. Profitability, however, is volatile in our business, as discussed above and always we will sustain to bring the best out of all type of situations.

M C Paul the harvest, the export opportunities, local demand, etc. etc.

It is very rare that all the factors, upon which the profitability of Animal Division or cake processing division are dependent, turning favourable. It is also very remote that when the factors which lead the profitability of one division are favourable, the factors relating to the other division also are favourable. However, last year it so happened that all the positive factors controlling the profitability of Animal Feed Division and Cake Processing Division were present for the major portion of year 2014-15. And that is how KSE clocked unprecedented mindboggling results.

The first quarter of FY 16, witnessed steep increase in the ingredient prices, which has reduced the margin in animal feed. The ingredient prices have further firmed up further in the second

quarter considerably. We have applied price change twice to reduce the impact. The situation is expected to improve in the third quarter, when the season for the major ingredients will start.

Your dairy division showed a phenomenal growth in first quarter of FY 16. Do you think that it will sustain throughout the year?

We are sourcing milk from Tamil Nadu and market the processed milk mainly in Kerala. In Tamil Nadu the procurement price of milk reduced due to heavy supply and profit of that division improved. Q1 of every financial year is lean season for ice cream.

Hence we believe that the performance of dairy division will further improve in rest of the period of FY 16.

Are you planning any additions to present product range in Jan 15 - Feb 15, 2016

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PROJECT OPPORTUNITIES

12

Manufacturing Multilevel Car Parking

B

abu is a Non Resident Keralite(NRK) from Ernakulam returned from Prof Job K T Dubai after serving about 30 years due to the domestic pressure to take care of the aged parents. However, he wanted to spend rest of his time productively. Thus, he is on a look out for various investment options.

He has observed that parking in Ernakulam city is real headache.

The roads in the city are having heavy traffic and City Traffic Police has put up “No Parking�

Boards in almost all main roads.

Though there are certain private open parking systems, it found to be totally inadequate to take care of heavy demand for parking of cars. At this time, he recollected the idea of Multilevel Car Parking Systems implemented in Dubai and other developed countries. He thought it will be a good proposition to start a company to manufacture Multilevel Car Parking System in Ernakulam.

India’s urban population is around 30% of the total population. Parking of cars is one of the major concerns which confront almost every day. The present sales of cars in the country are around 15 lakh. Again, the demand for cars is increasing at the rate 15% per annum. Besides the problem of space for cars moving on the road, greater is the problem of space for a parked vehicle considering that private vehicles remain parked for most of their time.

Multi-level Parking Systems have a number of advantages - optimum utilisation of space, lower maintenance and operational cost, lower construction cost (owing to the pre-fabrication) and comfort for the drivers. It might be interPASSLINE

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esting to note here that the earliest known multi-storey parking was built in 1918 in Chicago.

Automated Car Parking Systems are a method of automatically parking and retrieving cars that typically use a system of pallets and lifts and signalling devices for retrieval. They serve advantages like safety, saving of space, time and fuel.

Babu explores the different types of Multilevel Car Parking Systems (MLCPS) available in the country. Dependent/Stack System allows two passenger cars to be parked one above the other.

Its single post saves space and offers flexibility. Besides a platform (curved at the ends to allow

the car to roll on/roll off conveniently) there is an operating control pendant that can be located anywhere in the garage, basement and outdoor structure for operation from a safe distance.

It is easy to maintain; has lower power consumption, is simple in operation and is ideal for bungalows and apartment owners.

Dependent Car Parking System is based on Hydraulics. There is saving in space, construc-

tion cost, lighting, fire fighting, etc; the systems allow very fast parking-in and parking-out time, safety and security of the cars, reduced air pollution, and need little maintenance.

The two step stacker Type Parking System (a semi-automatic system) features a pallet that is lifted up after the car is loaded making additional parking space below the loaded pallet. Possible in both outdoor and indoor spaces, these electromechanically or hydraulically operated systems are preferably valet parking systems.

Horizontal Circulation Type Car Parking System operates on the principle of a conveyor; this sys-

tem is used for parking cars in two to four levels. The cars are driven on to or off on steel platforms at one entrance at ground level and parked cars circulate in the basement at different levels. It is operated by a motor chain and the parking space required per car is one third of the parking space required in conventional manual parking.

Yet another type of MLCPS is Puzzle Car Parking Systems. In

this system the cars move vertically and horizontally like a puzzle, till the car required comes to the lower level where it is driven out. Installed in basements, rooftops, open grounds, terraces and driveways, the system is designed in the form of a matrix of rows and columns such as 2 x 2 or 2 x 3 etc. in which out of the total number of available spots, a certain number of spots are kept vacant to enable horizontal and vertical movement of remaining spots. Available in the range of two to six levels, all the cars are independent of each other and the system can be installed in a phased manner.

Robotic Puzzle parking system is a fully automated system. The

entire super structure is like an automatic machine placing and retrieving cars. The user just has to drive in to the designated space, leave the car and collect a smartcard and on his way back scan it and retrieve his car.

Semi-automated Puzzle Parking System has a series of lateral and vertical movement of pallets which are self-supporting steel structures and operated through

Hence, it is estimated that there will be huge requirement for MLCPS in the immediate future.The units will be fully pre-fabricated and tested at factory and annually is proposed.

can be erected at site and can be shifted to any other sites at any time. The project What will be the rough investment to set up a manufacturing facility?

requirements are Multilevel furnished fabricated Carbelow: Parking System

A pre-

13

to manufacture 24 Nos for parking 28 cars

annually is proposed. The units will be fully pre-fabricated and tested at factory and

System programmable logic Controls (PLCs). The advantages are easy and low cost installation, minimal operational cost, easy to drive-in and drive-out, multiple entry/exit and a time less than 180 seconds for parking/retrieving a car.

Tower Parking System is a fully automatic system and involves an automatic storage system and a car elevator which moves vertically with the cars in upward and downward direction and a transfer device for horizontal movement.

Chess Type Parking System is a fully automatic futuristic parking system. This system ensures maximum utilization of the floor space without the need of drive ways and space for movement of mechanisms. This has floor mounted roller bed system which can allow the crisscross movement of the pallet and the car.

It has separate lifts which act as entry and exit points. Installed on RCC floors, it can be designed for 800 to 1000 cars or even more and can be used in longitudinal and square areas.

Rotary Car Parking System is like a mini merry go round in which 12 cars can be accommodated in a vertical height of 14 m and area of 30sqm. Operating like a merry-go-round, an empty pallet to park a car, or a loaded pallet with a parked car, is brought down to the ground level at the touch of a button; the average time taken after the button being pressed is 2-2.5 minutes.

Turn Table System allows the car’s direction to be easily changed by any angle to drive out as required. The system helps a car turn 360 degree and requires a space of just 5 meters to turn the car. It is available in either stand alone types or built in types.

Cart Type Parking System is preferably used in longitudinal park-

can be erected at site and can be shifted to any other sites at any time. The project

Sl. No.The project requirements Description are fur- The concept of MultilevelRequirement ing areas, this fully automatic Car requirements are furnished below: nished below: system available in multiple enParking is developed in the50begin1 Land cents tries and exits and has an inbuilt Sl. No. Description Requirement 2 Buildings 5,000 sq.ft mechanism called Cart which 1 Land 50 cents 3 Machinery & equipment required are CNC Lathe, band-saw Rs. 50.00 lakh moves every parking floor. It can 2 Buildings 5,000 sq.ft machine, drilling machine, gas are cutting machine, magnetic be designed with or without pal3 Machinery & equipment required CNC Lathe, band-saw Rs. 50.00 lakh machine, drilling machine, gas cutting machine, magnetic lets and can be designed for 50 to drill, sheet shearing machine, fly press, welding machine, drill, sheet shearing machine, fly press, welding machine, 100 cars or even more. hand tools etc. hand tools etc.

Stacker Type Parking System is 4a Rs.200.00 lakh Raw materials required MSchannel, channel, MS angle, MS lakh 4 Raw materials required are are MS MS angle, MS Rs.200.00 fully automatic system featuring sheet, pipe, motors motors and wires,wires, cables, cables, plate, plate, sheet, pipe, andgears, gears, a typical storage system having a control units, timers, switches, fasteners, wire ropes, control units, timers, switches, fasteners, wire ropes, unique mechanism called Stackpulleys, drums, pulley blocks etc. pulleys, drums, pulleypotential blocks etc. er. It moves centrally and has 5 Direct employment 25 persons parking slots on either side. It has 6 Power requirement 50 KW 5 Direct employment potential 25 persons inbuilt robotic mechanism that 6 Power requirement 50 KWit ningupofof20th century. However, The approximate investment requirement 24 units for parking 28 cars approximate investment re-for setting pulls and pushes the car to and The is yet to pick up in the country annually will cost 280.00 lakh indicated for Rssetting upas of 24 below: from the lift/parking bay. Prefer- quirement and Kerala, due to lack of equipunits for Sl. parking 28 cars annually ably used in longitudinal parking The approximate investment requirement for setting up of 24 units for parking 28 cars No. Particulars ment providersCost at an affordable 280.00 lakh lakhasasindicated indiareas, this can be designedannually for will will cost cost Rs Rs 280.00 below: (Rs in lakh) cost, erection and commissioning cated below: 100 to 300 cars or even more.

1 Land Own Sl. No. Particulars Cost Another MLCPS is Pit Lifting Parking System. This system (Rs in lakh) consists of three spaces - top, 1 Land Own middle and bottom which are 2 Buildings 75.00 united and lifted together. While 3 Machinery & Equipment 50.00 the middle and bottom spaces are underground in the pit, the top 4 Miscellaneous fixed assets 15.00 level is in the same line with the 5 Preliminary and pre-operative expenses 5.00 ground floor parking. Advantag6 2 Contingency@ 10% 15.00 Buildings 75.00 es include saving land area, low 7 3 Working Capital(1st Year) 120.00 noise, easy maintenance and proMachinery & Equipment 50.00 tection of the middle and bottom Total 280.00 4 Miscellaneous fixed assets 15.00 level from dust, rain and theft.

It is expected that institutions will provide term loan to the 5.00 extent of 75% of 5 financial Preliminary and pre-operative expenses It is expected that financial instidelays and complicated 15.00 operating Babu then asks for the requireContingency@ 10% lakh. the fixed assets6amounting to Rs 115.00 Apart from this, the unit is also eligible tutions will provide term loan to systems.

A rough estimate reveals ments of MLCPS. It is found st 7 loan Working (1 Year) for working capital of RsCapital90.00 lakh( 75% of working capital) in 120.00 the first year. The suitable for Commercial & Resi- the extent of 75% of the fixed as- that the demand for MLCPS will Total 280.00 amounting 115.00 expectedtotoRs bring in Rslakh.

75.00 lakh as equity capital. be very high once the system bedential Complexes, Hotels, promoters mul- setsare Apart from this, the unit is also It is expected that financial institutions will provide term loan to the extent of 75% of comes popular. tiplex & IT parks, Hospitals & eligible for working capital loan the fixed assets amounting to Rs 115.00 lakh. Apart from this, the unit is also eligible Showrooms, Railway Stations, The financial viability of setting up of 24 (Professor for parking cars Seannually is Job K Tfor is a28 retired of Rs 90.00 lakh( 75% of work- units capital loan of Rs 90.00 lakh( 75%nior of working capital) in the first year.

Air Ports and Public Parking. for working Faculty of Centre for Man- The provideding below: capital) in the first year. The promoters are expected to bring in Rs 75.00 lakh as equity capital.

He also queries the demand popromoters are expected to bring agement Development, Thiruvatential. Even though no finite de- in Rs 75.00 lakh as equity capital. nanthapuram.He can be contacted Sl. Particulars Amount at : jobkt012@gmail.com) The financial viability of setting up of 24 units for parking for 28 cars annually is mand estimates are available, all The financial viability of setting No. ( Rs in lakh) cities and towns in India are expeprovided below: up of 24 units for parking for 28 riencing the car parking problem. 1 Sales income from 24 units @ Rs.30.00 lakh 720.00 is provided below: Hence, it is estimated that there cars annually Sl. each Particulars Amount will be huge requirement for ML( Rs in lakh) 400.00 2No. Cost of raw materials, salary, power, CPS in the immediate future.

1 depreciation, Sales incomesales from commission, 24 units @ Rs.30.00 lakh interest on

What will be the rough investment to set up a manufacturing facility? A pre- fabricated Mul- 3 2 tilevel Car Parking System to 4 manufacture 24 Nos for parking 5 28 cars annually is proposed. The 3 6 units will be fully pre-fabricated 4 and tested at factory and can be 5 erected at site and can be shifted The concept 6 to any other sites at any time.

720.00

each term loan, administrative expenses etc.

Cost of Profit raw materials, salary, power, Operating

400.00 320.00

depreciation, sales commission, interest on

Breakeven point

term loan, administrative expenses etc.

Pay Back Period

Operating Profit

60% Less than one year 320.00

Internal Rate of Return

50%

Breakeven point

60%

Pay Back Period

Less than one year

of Internal Multilevel Parking is developed in the beginning of 20th RateCar of Return 50% century.

However, it is yet to pick up in the country and Kerala, due to lack of equipment Jan 15 - Feb 15, 2016

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providers at an of affordable erection and commissioning delaysofand The concept Multilevel cost, Car Parking is developed in the beginning 20thcomplicated century.

However, it is yet to pick up in the country and Kerala, due to lack of equipment

14

The US is preventing other countries from adopting the same measures it introduced to achieve food security.

By Jomo Kwame Sundaram and Vikas Rawal

T

he US once led the postwar global effort against hunger and food insecurity, but corporate influence on government trade negotiators now seek to prevent other countries from using some of the very measures it pioneered. Seven decades ago, the US led international initiatives to eradicate hunger.

This was the intention of the Roosevelts when they initiated the creation of the Food and Agriculture Organization of the United Nations as World War Two drew to a close. Three decades later, the same spirit ensured bipartisan support for the 1974 World Food Summit.

India’s food security and stockholding programmes use the same policies that the United States used in its early farm policy from the Great Depression, utilizing price supports, food reserves, administered markets and subsidies. Historically, the US farm and other related programmes have done much to raise productivity, as intended by the Indian and many other developing coun-

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try efforts. The US used these measures because they work, but now seeks to prevent other countries from using them.

Food security The US spends about $75 billion per year for its Supplemental Nutrition Assistance Programme (SNAP), the main domestic food aid programme. SNAP entitles about 47 million beneficiaries to buy, on average, 240 kg of grain valued at $1,608 per year.

Before expanding its food security programme, India was reaching 475 million much hungrier people with food aid of just 58 kg of grain per person, valued at roughly $27 per year. Compared to the US programme, India’s food security programme has ten times as many beneficiaries, and provides less than a quarter of the amount of grain per capita, valued at a sixth of the cost per person. India’s food distribution system was introduced decades ago.

In 2009-10, the programme was responsible for taking 38 million people out of poverty. India’s procurement and stockholding programme is for domestic con-

sumption, and does not subsidize exports. But just to be on the safe side, restrictions on subsidized Indian food exports can be imposed.

Trade liberalization The main difference has been compliance with the two- decade old World Trade Organisation (WTO) regulations, with its Agreement on Agriculture.

WTO-led trade liberalization has not only undermined industrialization, but also food production in many countries. Hence, most developing countries have seen at least some of their existing productive capacities and capabilities eroded, partly accounting for the slower growth since the 1980s. The subsidy element in India’s administered prices is calculated by comparing them to an international ‘reference price’ for 1986-88, not to market prices in India. The 1986-88 reference prices were especially low because the US and the EU were then ‘dumping’ huge food surpluses on the international market, pushing down prices.

Despite the recent decline of cereal prices internationally, food

15

price inflation since 1986-88 has been very considerable, so any price support today looks very high, involving huge subsidies.

Inter alia, India has asked that the reference prices be updated for inflation, so its administered prices can be reasonably compared to current market prices.

The allowed levels of trade-distorting support – the Aggregate Measure of Support (AMS) – for the US is about $19 billion. The level was set in 1994, based on prevailing high levels of tradedistorting support in the West and Japan, and has been reduced by only a fifth since then.

In contrast, like 61 of the 71 developing country WTO members in 1994, India’s AMS was zero.

Most developing countries then were under considerable pressure to cut government spending after facing fiscal and debt crises from the early 1980s. The US has also been underreporting its trade-distorting subsidies for years. For example, a WTO dispute panel has ruled that insurance subsidies and direct payments should count as trade-distorting subsidies. If corrected, US AMS notifications for 2010 should have risen from $4 billion to $15 billion. The

WTO’s ‘Green Box’ includes permissible, supposedly non-tradedistorting subsidies. About $120 billion of the US’s $130 billion in food programmes and farm supports qualify, much more than for other countries with larger populations. Most US subsidies – AMS and Green Box – go to crops like maize, soybeans, wheat and cotton that are heavily exported. As maize and soybeans are used for livestock feed, maize is the main input for US bio-ethanol and the US exports both meat and ethanol, such input subsidies should be declared as trade-distorting, but are still treated as non-tradedistorting subsidies.

Peace Clause In 1994, the US and the EU imposed a Peace Clause at the end of the protracted Uruguay Round of trade negotiations to protect themselves for nine years from WTO suits over their hugely distorting subsidies. In 2005, the WTO committed to resolve, “in an expedited manner”, the issue of the US’s trade-distorting cotton subsidies, which hurt many of the world’s poorest farmers.

A decade later, cotton producers the world over are still awaiting

US compliance. Over the last two decades, WTO restrictions and pressures from international finance institutions have forced many developing countries to cut their food subsidies, with dire consequences for its mainly poor and hungry beneficiaries.

The 2013 Peace Clause offered to India and the G-33 group of developing countries excludes subsidies, prohibits expansion of existing programmes and introduction of new food distribution programmes, and may not apply beyond 2017 even if the outstanding Doha issues remain unresolved. In the post-war period, the US has been prominent in the global effort against hunger and food insecurity despite not acknowledging the ‘right to food’. Many innovations adopted by the international community have their origins in the US. Narrow corporate interests should not be allowed to undermine this heritage. – Third World Network Features.

(Jomo Kwame Sundaram is with the Food and Agriculture Organization of the United Nations in Rome while Vikas Rawal is professor of economics at Jawaharlal Nehru University.)

Jan 15 - Feb 15, 2016

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CURRENCY FACTOR

16

T

Dr. Janet L Yellen, Chair of the Board of Governors of the Federal Reserve System

he US Federal Reserve had finally raised the interest rates after a 9-year gap Dr Rajagopalan Nair marking the end of the greatest monetary policy experiments of all time.

While this was almost a compulsion for the Federal Reserve, the markets have predicted it long back and even factored its impact in to their pricing of currencies. The timing seems to be perfect. The economic activity has slowed down in many emerging markets with commodities-linked countries hit hard as China began to slow down. The net capital inflows to the emerging markets is expected to be negative in 2015, first time since that happened in 1988. The end of the Fed’s “ zero interest policy’’ has been anxiously anticipated by investors for more than a year. It is for sure that the initiative taken by the Federal reserve to increase the rate of interest on dollar will have a positive impact on the US economy. US Dollar will continue to be a currency to reckon with and likely to be stronger in the coming days for some time. But the million dollar question is whether the present positive trends in the US economy can arrest the damage already happened to its world currency status. Now it seems it may have to settle for a status as “one of the world currencies along with other currencies including the Chinese Yuan “.

The deteriorating presence of US Dollar The Dollar is slowly losing its status as the world’s undisputed reserve currency .It has been the dominant currency in the international trade over the majority of the last century. At the

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time of formation of Eurozone, nearly 71% of the foreign exchange reserves was held in US Dollar. Since then this has gradually dropped to 62 % by the year 2014. Many feels that Uncle Sam is in trouble as dollar supremacy is declining.

Dr Jim Wille, a famous American financial analyst, in his analysis says that the hegemony of the Dollar will collapse soon. According to him, the most important reason for this could be the consequences of the 2008 crisis and US banking system is yet to get over it. As noted by Jim Willie, the US banks have been working on trust – on the one side there were the legal claims of investors and on the other side the banks kept liquidity using money received including from the drug trade. Thus the banks continued to be at risk. He goes on to add that even in terms of fixed commitments today the whole world GDP is about $60 trillion and this is only 1/10th of the debt which means there is a huge amount of unsecured debts even if we assume that some percentage of these debts are secured by some form of derivative product in the market. The cosmetic healing touch given by the Fed now by increasing the interest rates by 25 basis points seems hardly enough to enthuse massive investments in US dollar. Even a couple of dozes more in the coming days may not bring back the lost glory of greenback. For years now, the collapse of the Dollar has been visible. Recent developments show mounting pressure on the dollar’s reserve currency status. With a major international deflation going on, the threat of inflation through money printing is unreal. However if the dollar’s reserve currency status comes to end, then the repatriation of trillions of petro and euro-dollars could lead to a strongly inflation-

ary scenario. The US Dollar is losing value through inflation every year. The Dollar has lost over 97% of its purchasing power over the last century. Just how much more can the remaining 3% be debased from the Dollar, and how fast it is going to happen – is the more important question. A slow, gradual decline can occur without any one person ever even noticing the effects- until , that is , “ Black Swan “ event comes along and triggers the psychology of the investors to quickly reverse their thinking and then a collapse can literally happen in a short span of time. The Black Swan , a term coined by Nassim Nicholas Taleb in his bestselling book “ The Black Swan “ is an event positive or negative , that is deemed improbable yet causes massive consequences. This analogy can be used to describe the complexity of the US global empire complete with its massive debt and expenses to manage nearly 900 military bases around the world. There is only one factor that shields the dollar from implosion, and that is its position as the world reserve currency Without this exalted status, the currency’s value vanishes.

Will the fall of the US Dollar be complete in 2016?

The IMF’s Executive Board decision on 30th November means that the Yuan will be included in the SDR basket from October 1, 2016, effectively approving the Yuan as a major reserve currency and represents recognition that the Yuan’s status is rising along with China’s place in global finance. The IMF reviews the composition of the basket every five years. The fund rejected the Yuan for inclusion during the last review, in 2010, saying the currency didn’t meet the necessary criteria. With the inclusion of Yuan now the Chinese Renminbi to have weighting of 10.92 per

17

cent in IMF’s benchmark SDR currency basket. The decision to include the Yuan is an important milestone in the integration of the Chinese economy into the global financial system. It is also a recognition of the progress that the Chinese authorities have made in the past years in reforming China’s monetary and financial systems. A Bloomberg article suggests that the central banks of Korea, Philippines and Indonesia plan to increase Yuan reserves.

Other central banks may also take steps to build up their holdings of Yuan to diversify their foreign exchange reserves. Moreover, the portfolios of global organizations such as the World Bank are linked to the SDR basket. Just as the fund manager of an index fund needs to rebalance when the index adds a new stock, these portfolios will now invest in Yuan-denominated assets when the SDR is updated. Effectively the Yuan will be replacing a good part of the Dollar in all these efforts. China’s present economic status gives it greater room for manoeuvre by lessening, at least to some extent, the power of the US dollar in determining its connections to the world market.

The elevation of the Chinese currency must be seen within this context. Rather than providing a new foundation for stability and order, it is an expression of the deepening instability and disorder that increasingly characterize the global economy, flowing from the erosion of the foundations on which it was based—unchallenged US economic hegemony. The epic dysfunction of the Dollar is rooted in its reliance on perception rather than tangible wealth or strong fundamentals. It is like any other fiat unit with all its inevitable pitfalls built in to the structure. No wonder, the value of the Dollar Index is measured not by its intrinsic buying power, or its historical buying power,

but its arbitrary buying power in comparison with other collapsing fiat currencies. The notion that no foreign country would dare to dump the US Dollar because they are all too dependent on US trade – is misplaced . In reality many of the foreign countries are already calmly and quietly dumping the Dollar as a global trade instrument What will replace dollar?

Another important misconception in the market is that there is no single currency in the world that can replace the dollar and take its position if dollar falls.

We need to understand that there need not be another currency to replace it for the dollar to fall – dollar could be perfectly flushed out without a replacement in the wings. Economic collapse does not follow logical guidelines or the personal pet peeves of random man-child economists. The IMF has for many years been calling for the substitution of US Dollar with the Special Drawing Rights ( SDR ) as the world reserve currency. The SDR is a paper mechanism created in the early 1970s to replace gold as the primary means of international trade between countries. Today it is morphed in to a basket of currencies which is recognized by almost every country in the world and is in readiness to take the dollar’s place in the event that the dollar loses reserve currency status. The SDR was set up to act as a buffer for member countries when their currencies come under pressure. If a country’s currency wanes, it saps the nation’s purchasing power in the global market which can disrupt its trade in general. So, as a protection from this, each country holds a certain amount of SDRs to act as a reserve in times of need. To qualify for inclusion in the basket of currencies that make up the SDR, the currency must be used in foreign

exchange, must have sufficient transaction volume in derivative markets, be used as a reserve by Central banks and have interest rates set by the free play of market forces. The currencies in the SDR today are the US Dollar, Japanese Yen, Euro, and British Pound Sterling. The Chinese Yuan do not meet all the above criteria fully, still it is included in the basket of currencies by the IMF in the present circumstances The Central Banks in most of the countries have started taking independent policy decisions suitable to their country specifics distancing themselves from the dependency on the US dollar. The Germans, the Dutch and Venezuela have all requested their gold to be repatriated from the US. The Swiss, under the new program “ Swiss initiative to secure the Swiss National Bank’s Gold Reserves “ were also hinting that they want to get their gold back.

The Swiss government has a long standing tradition of backing their currency with gold. A monetary policy of near zero rates coupled with quantitative easing is completely incompatible with the circumstances in Asia, Middle East, Latin America and Africa – Hence they have to distance themselves from dollar. What is happening is an epochal loss in the relative wealth and economic power of the old G 10 bloc of rich countries compared to rising regions of the world. The Euro, Yen, Sterling, Swiss Franc and other major currencies will be relegated to the background along with the dollar in the rebalancing of this great process-- but surely dollar will bear the brunt.

Today’s info graphic shows that the wind is shifting in international trade, with less countries and organizations using the dollar to settle international transactions. China is at the epicentre and it is making continuous

progress in cutting deals outside of the US dollar framework. The most recent culmination of these trends is the creation of the Asian Infrastructure Investment Bank - a China-led rival to the World Bank and IMF that includes 57 founding countries with the capital of the Bank being $100 billion.

Other initiatives by China include removal of tariff on most of the Australian commodity exports to China and an agreement to pay each other in domestic currencies with Russia.

It is not only the Chinese that have started questioning the viability of dollar A report of the United Nations in 2010 called for the abandonment of US dollar as the single reserve currency. The Gulf Cooperation Council had also expressed desire to have an independent reserve currency.

Is it time to say good-bye to dollar, Hello SDR How long it will take for this to happen is not known, but it seems inevitable. The International Monetary Fund warns that the colossal trade deficit of the United States was a noose around the neck of the economy, emphasizing that the once mighty dollar could collapse at any moment and the Special Drawing Rights ( SDR ) with its international acceptability is obviously going to be the choice to replace dollar as a potential new world currency.

The progress for the SDR has been very slow and has not received much acceptance among the nations so far. As more and more countries lose confidence in dollar, The IMF can back the SDR with gold to promote stability and confidence in SDR. The IMF is reportedly holding more than 2800 tonnes of gold and hence may not find it difficult to do this. A shift in the reserve currency from the US Dollar to the SDR or to any other currency would speed up the fall of the dollar. However, in the short term, a crashing Chinese stock market and fledgling Eurozone, the dollar may find its life extended for some more time to come .

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‘India will be the HR factory for the world’

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he days of deliberations, evaluations and seminars on new management tactics for the management fraternity of Kerala have come. The one year wait is over by the commencement of the 35th KMA National Annual Convention on January 21 and 22, 2016 in Kochi. Like every year, KMA has chosen most vital and relevant topic as the theme – `Nation on the Move – Dynamics of Growth’-of the convention this year. By stressing on the relevance of the theme Prasad Panicker, President of KMA, said, “

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whole world is going through an tions of the world is that half of economic downturn. Most of the our population is young and edudeveloped nations includ- cated. According to the statistics, 50 per cent of our ing US have been trying their level population is below best to keep the 25 years and India will be a factory of economy back on human resources in track. The case of Asian giant China the coming years.

Our young honchos is not different.

But, in spite of will be placed in all these odds around major corporate us, Indian economy is houses in the top notch position and sailing through as chief executives without much Capt K C Cyriac wreck. The anall over the world. ticipated growth rate may Like Satya Nadella of Microsoft, strain a bit due to the global Sundar Pichai of Google, many issues, yet our economy is more talents will emerge from doing commendably good. India in the coming days”, says “Our upper hand over other na- Mathew Urumbath, Chairman of

the Convention. “ The lack of infrastructure is the main challenge for India to transform itself from developing nation into developed economy. To become digital super power, we do not need state-of-the- art infrastructure facilities like express highways or international airports with world class facilities.

What we need is young wizards with thorough computer knowledge. Unlike other nations we are immensely rich with young manpower. The days are not far away for our young engineers to become the leading force spearheading the digital growth of the world”, says Capt K C Cyriac, Executive Director of KMA.

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SNGCE: Providing world class education

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ree Narayana Gurukulam College of Engineering (SNGCE), established in 2002, is committed to its Vision of “empowering the masses to achieve economic and social freedom through technological and management education”. International collaboration is the latest step taken by SNGCE for providing world class education for the desirous students. The College has signed memorandum of understanding (MoU) with Stevens Institute of Technology, USA, Wayne State University, USA, Colorado State University, USA and Regenesys Business School, South Africa. These Universities have also agreed to provide opportunities for higher studies and researches to the students. International Conferences in SNGCE in future will be in collaboration with these Universities.

SNGCE offers BTech programme in Naval Architecture and Ship Building along with conversional branches like Civil, Mechanical, Electrical & Electronics, Electronics & Communication, and Computer Science. MTech programmes are offered by all the branches except Naval Architecture and Ship Building.

SNGCE also offers MCA 3- year course and 2- year lateral entry

to name a few. The institution of engineering community for also provides placement training publishing their original research and soft skill development pro- work. grams conducted by industry as Two international conferences well as academic professionals. conducted every year give opThe college also facilitates indusportunity for teachers try interaction through and students of differinternships. ent universities to interact with people who State of the art infraare doing research in structure facility is a similar areas. 300 rehighlight of SNGCE. search papers received Special areas of focus in the last international like solar energy and enconference is the proof M A Raju vironmental researches Executive Director of its acceptance by the are being developed. Training academic community. Departprogrammes are provided to the students for getting placement ments are also publishing newsafter their graduation. 240 job letters for making the activities of offers to the students in the final department public. year by 65 companies in 2015 Talents of students in related as stands as a testimony for the ef- well as cultural areas are promotfort. The college has secured ed through annual cultural comaward for best placement support petitions and technical project

by ICTAK. It started research competitions.

programme. MBA is offered as a residential programme to give more opportunities for training and soft skill development, which will lead to better placements. The institution provides ample placement opportunities and hosts recruiters such as Aditya Birla, KPMG, Raymond, HDFC Bank

Quality hostel facility is provided for boys and girls inside the campus. Hostels are provided with Wi-Fi facility for better utilization of e- based learning.

Every department in the college is publishing journals of international standards that provide opportunity to students and teachers

centre affiliated to KCPFOS. The college is accredited by NAAC. Academic excellence is ensured by providing best teaching learning process by teachers with MTech and PhD qualifications.

All the teachers do have either MTech or PhD qualification.

University ranks and higher pass percentages in all the branches of study is the outcome of committed efforts from the teachers.

Incubation centre named “Gurukulam Technological Business Incubation Centre (GTBIC)” provides facility for starting their own business for the students.

Students can start working in GTBIC when they are in the campus and they can continue in GTBIC for 3 years after passing out from the college.

Computing facility in SNGCE is known for its quality. Various Government and private organizations partner with the college to conduct online tests for GATE, CAT, JEE, AIIMS, JIPMER, NIMHANS, SBI, DNB, UPSCCMOE etc.

Altogether, SNGCE uniquely provides all the facilities required for learning and conducive ambience is set for excellent performance by any student who is willing to work hard for a better and secured future.

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BANKING IN 2016: Challenges, expectations galore Payment b a n k s and Small banks Indian banking industry witnessed a paradigm shift ever Dr V A Joseph after the launch of Payment banks and Small banks. The objective of RBI (Reserve Bank of India) by granting licenses to Payment banks and Small Finance Banks was to bring financial inclusion in rural and semi-urban areas.

This will make direct transfer of wages and subsidies easy and accelerate India’s journey into a cashless economy. And it enables to bring rural people under the fold of the digital economy. Payment banks are expected to alter the way the business is done; they will complement PSBs rather than competing with them. Mobile phones play a pivotal role at the core of these changes. Payment banks are to provide basic savings, and deposit, payment and remittance services to people without access to the formal banking system. However, they will not be in the business of lending, at least for the present.

Small Finance Banks, on the other hand, will offer basic banking services, accepting deposits and lending to unbanked and underserved sections including small business units, small and marginal farmers, micro and small industries, and entities in the unorganized sector. Functioning of both of these banks are expected to give a fillip to financial literacy and financial inclusion among the semi-urban and rural population.

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fade away. Banks should shed their conservative mindset and use innovative digital technologies for their growth and survival. They have to create digital wings to experiment and learn social, mobile and digital innovations on an ongoing basis. Continuous customer engagement and providing sustained customer satisfaction through innovative financial products and services should be part of the mission. For example, recently, SBI has commenced operation of a high-tech self service branch - most of the functions such as cheque deposits, cash deposits, pass book update and account openings are done by self-service machines.

More such efforts in these lines are expected and experimented in 2016 and beyond.

As estimated by Internet and Mobile Association of India, the country has 40.2 crore internet users now. Out of this, 30.6 crore customers use internet, through mobile phones and tablets. During next five years the number of people using internet through mobile is expected to rise 25% annually. Mobile has become the tool for the foundation of digital banking and for its vast possibilities in the banking service in India. Banks must learn to leverage it to develop relationships across the customers of all age groups.

NPAs The gross NPA of the public sector banks rose to 6.03% as of June 2015 from 5.20% in March 2015.

As banks reel under huge bad debts, RBI and the government adopt a proactive stance towards the banks to clean up their balance sheets by March 2017. Keeping the deadline, RBI has suggested a number of ways and means for banks to improve their asset quality. For example, 5:25 scheme for infrastructure projects. As

per the scheme, the companies can easily repay loans over ₹500 crore since the loan tenures are extended for up to 25 years with fresh refinancing evaluated every five years. However, the interest rate on the loan is raised since banks need to preserve the NPV. Banks grant loan to a developer for 25 years, with an option of rewriting terms or transferring loan to another bank or financial institution after five years. It helps to align the repayment schedule of a developer according to the cash flows of the project. Erratic economic conditions cause slippage in cash flows. Repayments are bound to get delayed as a result.

In view of this banks hesitate to lend to the developers. The extension of repayment period has reduced risk of the project becoming an NPA. This is a major relief to infrastructure firms.

Capital Adequacy Banks have to maintain Capital Adequacy at any point of time, as it tells about the ability of a bank to meet the needs of its depositors and other creditors. It is the proportion of risk capital to risk adjusted assets in a bank.

The government has injecting Rs 70,000 crore into PSBs over the next four years to guard against the sagging capital adequacy requirements of banks. The minimum international requirement of CAR prescribed by the Bank for International Settlements (BIS) is 8%. If at all further shortfall of overall capital requirements exist, the banks can go through IPO route by accessing equity capital markets.

Split of CMD post ensures good corporate governance The Government has recently split the Chairman and Managing Director post in the PSBs. The chairman would be a reputed person from the industry while the

Managing Director and CEO will run the daily functioning of the bank. Under the new dispensation the Chairman of PSB, except State Bank of India, will be a part time Board Member, who would preside over the Board Meetings and will not be an Executive Chairman.

The CMDs of PSBs often dominate the boards. The government’s new initiative of functional separation will help to improve the functioning of the top management of banks. This separation will also discourage the government to interfere in the activities of a bank, in the capacity of the principal shareholder. Finally this will result in improving corporate governance practices in PSBs With the introduction of the forgoing changes it is expected that the all round competitiveness of the market will pick up fast. Further reduction of interest rate is not seen much in the air in 2016 as it will come in the way of profitability position of the banks and this will in turn, affect their already sagging capital adequacy position.

Conclusion Breathe matters for fish which lives in ocean of water, and it also matters for human beings even if we live in ocean of air. As breath is to life, money is to business. Borrowed money pollutes our life if we mistakenly handle it. After all, “buy now pay later” is a short term philosophy! Grant loan if borrowers’ requirement is absolute and repayment capacity is stable. All the stakeholders should display honesty, integrity and discipline in handling other people’s money. It is time to contemplate over the timeless guiding principle, ‘back to basics’ to instil good credit culture in 2016 and beyond.

(Dr V A Joseph former MD & CEO of South Indian Bank)

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Albertian Institute of Management

B-School that moulds the best management professionals

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lbertian Institute of dynamic than ever before. LocatManagement(AIM) Ko- ed in the heart of Kochi city, with chi is a New-Gen B- a state-of-the-art infrastructure School owned and administered and core faculty with rich indusby the Archdiocese of Verapoly, trial and academic experience, which has an inspiring legacy the college stands tall in the field spanning over centuries in the of management education. In adfield of education. A dition to the regular premier unit of St Alfaculty there are disbert’s College, AIM tinguished visiting has been offering twofaculty from presyear full-time MBA tigious institutions Programme approved and organisations.

by AICTE and permaAcademic proficiency nently affiliated to the is achieved through Mahatma Gandhi Uniregular seminars, case versity. The institute Rev Fr Antony Arackal studies, conferences, imparts high quality, etc. There is focus on value-based, industry-focused experiential learning through live management education that helps projects. A comprehensive and to mould the best management well-equipped library with latprofessionals. The programme est books, periodicals, journals, lays the foundation for an in and subscription to online datadepth analytical and conceptual bases such as EBSCO, J-Gate, Dunderstanding of the Indian and Space, and so on, make learning International business scenario. more enriching at the campus.

Today, under the benevolent Today, the demand is for business patronage of the most Rev Dr leaders with knowledge, skills Francis Kallarakal, the Metro- and perspectives from multiple politan Archbishop of Verapoly, and divergent disciplines. The the institute is marching ahead MBA programme at AIM is deto higher echelons in the field of signed and imparted to equip the management education. Teaching management aspirants to take and learning process on the global business at AIM is so designed challenges. SAP trainto achieve excellening programme is imcy by enhancing the parted to the students to knowledge and skills enhance their employof the students. The ability. objective of AIM is to According to Rev Fr acquaint the students Antony Arackal, Manwith the dynamics of ager, AIM, Business the business environ- Dr Rajagapalan Nair Management is techment and to develop Director nology driven and the their strategic thinking, creativity focus now is being shifted to and decision- making capabilities ‘profit making through social with emphasis on their holistic commitment’. Therefore the videvelopment, imbibing the mis- sion of AIM is ‘to be a leading sion of the institute.

B-School of international repute, Ever since its inception in 2006, AIM has found itself in a continuously evolving business landscape which is more complex and

Information Technology and Production. Industrial Tours and visit are being organized by the institution to expose the students to real time situations. ‘Colloquium, a monthly talk by the experts from the industry is an added attraction of AIM. ‘Aegle’ the annual Management Fest of AIM is well-acclaimed by the student community. The institute brings out a Management Journal ‘Erudition’, which incorporates research articles on various areas of business management and case

studies. Students are actively involved in the Corporate Social Responsibility ( CSR ) activities which help them in cultivating the habit of social commitment.

‘Reflections’, the monthly news letter of AIM highlights the activities of the institution and is communicated to the parents.

The Institute is a member of professional bodies like Kerala Management Association ( KMA ) and National Institute of Personal Management ( NIPM ).

constantly striving to contribute to societal needs and welfare’.

The Institute offers specialization in Finance, Marketing, HR, Jan 15 - Feb 15, 2016

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Changing trends in Management Education

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anagement education is going through changes. The changing sceDr Rajagopala Nair nario offers students more openings, greater self confidence and out of the box ways to better hone their skills.

The current trends include internationalization with increased focus on international partnerships, international internships, student exchange programs, joint degrees etc. Also, the use of new technologies in management teaching is a trend that is catching up fast.

Greater use of the social media to establish connection with students is on the rise. More interdisciplinary offerings in classes, for example, where marketing, strategy and OM faculty come together to teach a course, are seen as the way forward because in real life situations most issues have multiple dimensions. Yet another trend doing the rounds is engaging students in games that simulate the need to find solutions to complex scenarios through teamwork. The earlier craze for management education seems to be over. Students have realised that like in all other subjects, they can get good jobs with management education if and only if they learn something at school. They are also less likely to be taken in with promises of placements – they use diverse sources of information to check such claims. There are now lots of good European Bschools which are offering management education in English, in addition to the American and Australian B-schools. However, fees tend to be high and financial aid is not readily available. Students can try to work for a few years and save some funds before applying abroad.

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pected outcome of the management education programme, discipline-orientation and ivorytower approach of the academicians, lack of involvement by practitioners in the industry and bias towards conceptual learning are some of the factors hampering the effectiveness of the Indian management education. He gives general suggestions for enhancing the effectiveness of Indian management education including: a) shifting the focus of programmes from conceptual learning to skill development, attitude change and value classification; b) acquiring a faculty having a greater practical orientation and an interdisciplinary approach; c) establishing greater collaboration between the management institutions and the industry with regard to the design and contact of management education programme’s and research; and gradually discontinuing the government financing of management institutions and encouraging these institutions to generate funds from the industry and the market.

All the aspects of business education such as quality of MBA aspirants, curriculum, business research, quality of research publications, industryinstitute interface, management development programmes, placements, compensation packages of B-School graduates, career development trajectory of alumni, diversity among faculty as well as students, governance and accountability etc. are under critical scanner. Indian B-Schools are not untouched by the contextual compulsions of the Management education in the international arena. Indeed, B-Schools in India are facing multiple issues such as proliferation of B-Schools, quality of education, faculty shortage, poor regulatory mechanism and governance and accountability.

When Management education began in the early 20th cen-

tury, there was already a corpus of literature for education, training and further research. Management education, which was originally conceived as an elite educational track, dedicated exclusively to business ( and more precisely to big corporations ), found itself confronted with an ever growing demand from millions of individuals seduced by a promise of a better future, or forced into entrepreneurship and management by evolution of markets. However, Management Education gained real impetus in the last decade of 20th century marked by globalization and liberalization and rise of good number of transnational corporations.

Internationalization of labour market, commodity market and capital market created incredible opportunities for all by offering choices at the competitive prices, raising quality of life and aspirations, expanding service sector and providing decent employment to millions of youth. Information and communication technologies revolutionized the way we conduct business.

However, Management Education sector faces greater scrutiny from a wider group of stakeholders than at any time in its history.

True, management education has now entered a phase of profound transition driven by globalization, technology demographics and pressing social imperatives. No other academic discipline has accomplished this feat in less than 150 years of existence. BSchools of the world symbolize professionalism, flexibility in

learning, innovations in curriculum design and pedagogy, and above all – value for money. No wonder, getting into an MBA is the foremost aspiration of youth across the globe today. In the Indian context, management education has become an ornamental degree with less emphasis on professionalism. The quality of intake has deteriorated over the years. The second tier and third tier B-Schools are struggling to get good quality students who are passionate for management studies. A handful of creamy students with a class apart are occupying strategic positions in multi-national and national corporate. A huge bunch of MBAs are either under-employed or unemployed.

Some of them have compromised at low salaries in small and medium enterprises.

(Director, Albertian Institue of Management, Kochi)

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Corporate Insurance – Do’s and Don’ts

W

e

are living in a world of risks. Although we are in a path Viswanathan Odatt of belonging to a new type of economic advancement and progress, these risks often cause us to make losses. In particular, when corporate institutions go for security measures, costs will go on increasing and accumulated losses will be resulted, unless we accept the help of the best professionals. The interests of the insured and the insurer must be duly protected. Most of the corporate firms should be equipped with necessary infrastructure network investments. Therefore, if a natural disaster hits these corporate entities, the reinstatement cost for them is going to be very high.

Before insuring the institution, the insurer should check which are the risks faced by them. It is most important to insure the assets of the institution as well as

the staff and employees. However, due to the change in the policies of the leadership, and errors in decisions, certain legal liabilities could arise towards the customers as well as the public in general, which can be insured to protect. Next, the amount to be insured should be fixed. It should either be on the reinstatement value, or the market value, which is preferable by the insurer. If there are any existing policies, the risks to cover in the policy, the insured value and the property concerned are to be surveyed and verified.

People who take loans from banks and other financial institutions often face the problem of under insurance where the sum insured being not sufficient to cover the risk. So long as the loan amount and the actual value of the property could be different, on most occasions when there are claims, with most insurance policies, there are chances of under insurance. Due to this reason, on such occasions, only a nominal amount could be disbursed as claim.

The next step is to prepare a list of the assets. Along with this, the

risk inspection should be done with the help of an expert so that when there is a claim, the causes can be prevented to a reasonable extent. Then the policies insurer may be finalized.

The selling agents representing only one company, could sell products from that company only. We should understand the significance of insurance broking companies in overseas markets due to this. Brokers can represent corporate firms to make assessments about their insurance requirements and suggest tailor made solutions to meet them.

Brokers can also bargain for the lowest rate from a number of insurers to select the best policy among them. When there is a claim, the broker helps the customer to settle the claim favorably. Brokers who can assess the market fluctuations and select the insurance portfolio effectively for each type of customers are now in our country also. To manage the higher risk involved with the corporate firms, they need to select the insurance policies with utmost care and caution. All corporate firms should take the responsibility to protect your valuable assets by insuring with the right type of policy.

We know that in India, the detariff system was introduced in insurance since 2008 which resulted in premium rates becoming competitive. Due to this reason, the policy could be selected only after comparing the premium of various competitive insurance products. The trust worthiness, data relating to effective claim settlement and support service efficiency are the other factors to be considered while selecting a policy.

Health and accident insurance policies could be customized as ‘tailor made’ policies according to our requirements. Higher discounts could be demanded when insuring firms covering fire, engineering, liability, marine and motor insurance. When insurance is done with higher amounts, a lower rate of premium is made available. Moreover, preference will be given to corporate firms while insuring with high premiums.

(The writer can be contacted on Mobile: 9020465757, Email: odatt@aimsinsurance.in)

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CHOOSING A BETTER B - SCHOOL students find themselves a tad uncertain, even baffled with the choices when it comes to choosing a management school.

Core Faculty

Dr Kemthose Paul ver the past decade, the number of institutes offering management education in various forms ranging from MBA, Executive MBA, PG Diploma, certificate course and more are on the higher side and the task of selecting the best B school becomes a herculean task both for the parents and MBA aspirants.

Even in the fast changing digital era where there is tremendous explosion of information at the click of the mouse in the laptop in front of a person, parents and

O

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Faculty and their quality have an enduring impact on the overall quality of the institute. Highly qualified and experienced faculty with degree from stellar institutes and industry experience are an integral part in imparting practical knowledge as compared to only theoretical. The amount of research activities carried out by the faculty is also a pointer towards their practical knowledge as well as to judge how well the teachers are tuned to the changing trends in research and development.

Updated Curriculum With a shift in the pedagogical approach, B-Schools are designing courses that are in sync with the fast changing needs and trends in the industry. Instead of laying emphasis on courses like strategic management, strategic marketing and strategic HR curriculums are increasingly including courses like organization of work and management of resources at the work s i t e

to enhance skill building and knowledge building of the students. A General Management Programme gives students the flexibility to join any sector diversifying placement opportunities as opposed to a Specialization-based Programme.

Value Return Analysis In today’s competitive global scenario, it becomes imperative for students to choose a truly meaningful institute rather than blindly follow a brand name. An institute that comprises of high-class faculty having a right combination of industry experience, research and academics, the kind of course it offers and its corporate association gives it an edge over the others. As opposed to information gathered from the websites and brochures, a thorough investigation will pull more weight age in

correct decision- making.

Money alone is not everything Until now, we have not discussed what is perhaps the biggest factor in determining where you will go to college—money. At this point, do not let costs dictate your goals. While tuition is expensive, there is also the availability of financial aid. The real question is not how much a college costs, but how much one has to pay out of pocket after taking into account scholarships and financial aid. It could turn out that with financial aid and scholarships, the most expensive B-School on your list would actually cost the least amount of money.

Institute accreditation and collaborations Before

believing the

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taglines such as “First in India, First in Kerala”, “Only B-school to …..” and more which many B schools provide in their ads, feel free to go to the institute and have a chat with the institute authorities to get a first-hand idea of the important accreditations the B school is having to name a few NBA (National Board of Accreditation), ISO, NAAC (National Academic Accreditation Committee) and more. Also have a clear idea about the collaborations that the institute is having with various foreign universities.

Your last phase of campus life…..Make this opportunity count.

Residential model with hostels throbbing with life undoubtedly provides the best learning and memories over the two years. If you have the choice, pick an institute that offers a residential program. In addition to what you learn in class, you will get to live with your peers and pick up life skills that are so essential for success, both at the personal and professional fronts. It is also much more fun – let’s not underestimate the importance of fun in the overall b-school experience .Staying in an apartment close to the institute or being a day scholar is not half as good as having a hostel within the college grounds.

The deeper your interface with the industry, the better your readiness for it Most business schools claim to have a strong interface with the industry. But you need to verify this claim. Industry interaction can be as superficial as a bunch of guest lectures by people from the industry to as intense as working on live industry projects and being taught courses co-designed and co-delivered by the industry. Some schools partner closely with the industry – as

a student you stand to gain immensely from such associations.

To start a career- a firm and sturdy launching pad is in need.

And finally, placements! This is the most hyped and the most misleading part of the b-school story.

Instead of going by average salaries and ‘100% placement’ tags, look for the critical things such as: which firms recruit from the school, at which level and for what kind of work (profile)? For example, someone like HDFC, IDBI, Federal and ICICI Banks would be recruiting from a whole band of b-schools starting with the top IIMs and going up to second or third tier b-schools. The difference would be in the profiles they offer and the level at which they recruit. Talk to seniors and understand this nuance simply because it’s the most important component of placements.

While selecting, students should look for the companies that regularly visit the college campuses and inquire about the placement percentage of the college. It is always wiser to inquire through alternative sources like previous students or existing seniors rather than just going through the brochures. In the case of placements, a look into the number of times the same company visiting the institute over the years also needs to be looked into along with the minimum and maximum package that is being offered to the MBA aspirants.

There is a lot of noise in the market – most of it irrelevant The size and number of advertisements, the offer of free laptops, tie-ups with foreign universities you haven’t heard of, guarantee of 100% placements (it is illogical to believe that an educational institute can guarantee anyone a job – the jobs are offered by the industry). On a more serious note, the location of the college is also not a key parameter – else IIM Ahmedabad would not have ranked number one in the country.

The best source of information is the customer – the past and current students of the school The weakest sources of information are institute-sponsored advertisements. The digital medium is fast evolving as a more reliable medium; well-governed websites like facebook, twitter and more are a good bet. The best people to ask about an institute are its students – current and past. As a community, students do not lie; there would always be exceptions who take their passion for their school a little too far, but on the whole you are safer.

The biggest tangible evaluation one can draw about any B School is by interacting with the product (Alumni) that they have created.

The alumnus of any Institute will speak volumes about the performance of the college & the direction & change it has provided to the candidate in his/her tenure with the brand. Asking the alumnus about the college is one of the major sources of information.

However, it makes a lot of sense to visit a couple of campuses before you make the final decision.

You will get an idea of the quality of the faculty and student communities – and answer that most important question of all – would you want to spend the next two years of life in this campus, with these people? If the answer is yes, you have got the school you wanted.

In summary, look for the things that really matter – quality of faculty, peer-group, pedagogy, infrastructure and industry-interface – placements are a natural outcome of other things falling in place.

Choosing a B-School is half the battle won as; the right institute provides a platform for supporting the whole process. And once you get admission to the school of your choice, make sure you get the most out of the time you spend there. All the best!

Jan 15 - Feb 15, 2016

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Engineers but Jobless: Rethinking

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ngineering, Medicine and Management are the most sought after professional Dr Dimple Tresa Abraham courses that parents aspire for their children. Many start saving for the expenses of these courses right from the time a child is born. The ‘corpus’ saved is to take care of tuition fees, hostel and miscellaneous expenses for 2, 4 or 5 years depending on whether the son or daughter has enrolled into an Engineering, Medical or Management college.

In this article I would be referring specifically to Engineers and the condition of their employment, under employment and unemployment in the state and suggest measures that could be adopted to alleviate some of the issues.

The aspirations of parentbegin the day they accompany their son or daughter to the first day of classe sin the engineering college, an admission that they have together secured spending substantial amount of time and money. They aspire and visualise them as executives working in centrally air-conditioned steel and glass offices earning fat salaries in four years flat. Most dream of the day when they can proudly proclaim that their son or daughter works at TCS, Infosys, Wipro, Accenture, L&T, ABB, Google or one of the top companies. But

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majority of them in the past few years have found the dream to just remain as a ‘dream’. Some also find the dream crash landing early when their ward fails or drops-out of the four-year course, right in the first year or mid-way.

It is estimated that one in every two students enrolled either drop out of the course or fail in the exams. This may also be attributed to the fact that for many, engineering is not a de-facto graduation choice but are lured into by peer and family pressure and not because of interest or aptitude.

The huge growth of services, Y2K resolution and India being chosen as the outsourcing destination in 2000’s saw a booming

favoured employment option for those aspiring to go to foreign shores. Some who were sent on off shore/ on-site assignments abroad, particularly in countries like the US managed to stay on converting their H1 B visas to green cards and even to citizenship, making engineering career a ticket to greener pastures.

However, today, it is a different story altogether. Owing to various reasons the number of engineering graduates who remain unemployed in the state and country has risen since 2005 and continue to rise year after year.

Parents, particularly those who invested a sizable portion of their life savings on tuition and hostel

Limited Exposure to industry is a major lacuna of Indian engineering education. Until the fourth year, majority of the colleges do not give any hands on training. Many colleges do conduct one day/short industry visits which are part of the curriculum but that alone is not enough. Industry attachment of the student should begin early, may be right from the second semester.

IT and IT services industry and consequently a huge demand for engineering graduates. Among engineering streams, first preference of most became electronics and communication followed by other streams like mechanical, automobile, electrical, civil etc. Engineering graduates from Kerala majoring in all streams, whether they came from Tier I or Tier II colleges were lapped up by the industry, particularly the IT industry in Bangalore.

The Middle-East was another

expenses are worried about how their children would fend for themselves, if they can’t find jobs and long-term secure employment. Some who can afford further studies motivate their wards to join an MBA programme in the hope of improving job prospects. On the other hand, parents with family owned small or even bigger businesses/land assets are less bothered of job prospects, and initiate their wards into the family business delegating responsibilities and roles.

Unemployment among engineering graduates in the state rose from 6389 in 2005 to nearly 3 times at 17,895 in 2013. Among those employed, many are under employed or stuck in jobs that any graduate can do. It’s a fact that many engineers are employed in call centres or in totally unrelated fields where their four years of training are more or less wasted and forgotten. Thus majority are treated at par with diploma or other graduation holders all competing for back office call centre jobs, bringing in huge disappointment.

The major reasons for rising unemployment among engineering graduates are both demand and supply related. Demand from the IT industry and countries in the Middle East, or the Gulf has drastically declined in the last few years. In terms of supply, while the quantity/ numbers of engineering graduates have risen, the quality has fallen.The quality of education imparted by majority of the private engineering colleges is extremely poor with substandard material and human resources.

It is a fact that education imparted by many of the engineering colleges in Kerala and other states are mostly theoretical without industry exposure or hands on training, as is the case in countries like Korea, Japan, Germany or Singapore. The National Employability Report for 2011 indicates that Engineers from Kerala figure at number 10 in terms of employability in the IT services sector among 16 states. In recent

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about professional learning years, industry leaders like Ratan Tata and N R Narayana Murthy had expressed their reservations about employability of engineering graduates across the country and quality of education even in leading engineering institutes.

The concerns expressed by industry are genuine for the following reasons which need to be addressed and rectified to improve employability of our engineering graduates. These are • Outdated Learning is a problem that needs to be tackled immediately. Yes, foundation and learning basics are important; but then ancient programming languages can be done away with it altogether. Instead, keeping pace with latest developments in the industry is key for better fit of the output (engineering graduates) with what industry requires in terms of inputs (technically sharp fresh recruits).

• Exam Culture and grades are central for students and even in clearing the screening phase during campus recruitment process. But over emphasis on grades and CGPA (Cumulative Grade Point Average) may result in students who stop learning or not developing the skill for unlearning and relearning which is extremely important in the fast changing world of technology where change is the only constant.

Limited Exposure to in• dustry is a major lacuna of Indian engineering education. Until the fourth year, majority of the colleges do not give any hands on training. Many colleges do conduct one day/short industry visits which are part of the curriculum but that alone is not enough. Industry attachment of the student should begin early, may be right from the second semester.

I would recommend the following measures for addressing the

issue discussed. The recent initiatives of Government of India needs to be dovetailed alongwith the educational initiatives to achieve this aim. Without this India would continue to be a back office for the world and could be discarded at any time leading to even greater unemployment.

Every batch of students, 1. irrespective of stream (Electronics Communication, Computers, Mechanical, Automobile, Telecommunications etc) especially those from the IITs, NITs and may be top 100 engineering colleges in the country should be adopted by atleast one medium or large company working in the related field. The students from these colleges should be allowed to periodically interact and associate with R&D teams of the company.

Such an industry immersion will gear up the student towards the profession which he or she would later join after completion of the course.

across technical institutes. Strong ties with engineering education would definitely help in realising goals of ‘start-up’ India campaign. Innovation and enterprise will happen only when creative and critical faculties are stimulated. Entrepreneurship culture and incubation centres should be facilitated with all possible support.

Engineering curricula should include modules on disruptive technologies, to stimulate thinking and experimenting for solutions to present day problems.

Thus practical exposure and imparting learning that is abreast with industry is critical. If we can ensure quality product, that is engineers who can compete with the best, there would be buyers.

Appellate bodies of technical

education like the AICTE should ensure that high standards of education and learning are maintained by all approved institutes in the country. Parents should also ensure that only children naturally inclined and interested towards engineering sciences be motivated to choose it as a career option. Others should opt for fields of learning that would hold their interest.

(The writer is a PhD in Economics and has worked as faculty in management colleges in Kerala and Delhi for over a decade. She currently works at the Centre for Women’s Development Studies, New Delhi and can be contacted at dimpletresa@gmail.com)

2. Engineering Colleges should be given incentives by Companies as well as GoI, in the event of any innovations or designs created by them are adopted by industry. For instance, suppose a pollution reducing valve is invented by students of an IIT/NIT/any engineering college, then it should be recognised and awarded. The incentive could also be in terms better college rating (for example, from ICRA EG 4 to ICRA EG 3) or additional financial aid from the Ministry of Skill Development and Entrepreneurship. All innovations should be eligible for awards but innovations in areas like renewable energy, less polluting or pollution less devices for automobile industry or even their components should be given additional weightage.

The Ministry of Skill De3. velopment and Entrepreneurship should facilitate and promote initiatives for business incubation Jan 15 - Feb 15, 2016

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ASIET: Most-sought-after institute in the technical education sector

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di Shankara Institute of Engineering & Technology (ASIET), established at Kalady in 2001 with the aim of providing value-added technical education, soon became the most-sought-after institute in the technical education sector in Kerala. ASIET is a budding example of socially committed tech education deeply rooted in technical as well as moral excellence.

The institute is committed to serving the nation and humanity by bestowing quality education well-grounded in the principles of engineering and technology and by providing an ambience that is conducive to the growth of professional education, industrial and social upliftment. ASIET was set up with a mission to build a strong centre of excellence in Engineering and Technology targeting global standards. The idea was to provide a good environment for individuals to transform into technologically superior, socially committed, spiritually elevated and nationally responsible citizens. As a result of this focus, the institute has industrial tieups with Infosys, Sriram Groups, TCS etc.

Inspired by the ancient philosophy of Adi Sankara, the Adi Sankara Trust keeps the light burning

Electronics Engineering, Information Technology, Mechanical Engineering (Two Batches) & Civil Engineering.

for the generations to come. It has been a pioneer for the last 50 years in catering to the growing demands of highly specialized science graduates and technologists. The trust today owns six prestigious educational institutions, namely, Sree Sankara College, Sree Sarada Vidyalaya, Adi Sankara Institute of Engineering & Technology, Adi Sankara Business School, Bharathi Theertha Education Society, Adi Sankara Training College, PNNM Ayurveda Medical College, Sree Sarada Special School & Adi Sankara College of Arts & Science.

At present the management of

ASIET is in the hands of Sri K Anand, the Managing Trustee. The college is headed by Dr S G Iyer, as Director (Academics) and who are ably assisted by a group of young, dedicated and competent faculty.

The institute has been accredited with ISO 9001:2008 certification.

This is the first Engineering college to get the prestigious international standards certification for the quality system of technical education. From that moment, the transformation of the student into a totally competent engineer is the responsibility of the institution. The certification is done by ISOQAR. Some Land Mark Achievements of ASIET are: ASIET is the first new generation engineering college that has acquired ISO certification in Quality Management.

K Anand

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ASIET offers following courses under graduation level: B Tech Degree( 4 Years in 8 Semesters) courses in Applied Electronics & Instrumentation, Electronics & Communication Engineering (Two Batches), Computer Science & Engineering, Electrical &

ASIET also provides PG Courses in engineering which are: i) M Tech in VLSI & Embedded Systems, ii)M Tech in Power Electronics & Power Systems, iii) M Tech in Computer Science & Engineering & iv)M Tech in Communication Engineering.

MBA at ASIET is offering specializations in Marketing Management, Human Resource Management and S G Iyer Financial Management. The Institute is also offering non-credit papers in contemporary areas of management like logistics, entrepreneurship management etc.

Multinational companies regularly visit the campus to get energetic and qualified employees.

Some of the companies who visited ASIET during 2013-2014 are TCS, CTS, UST Global, Reliance Communications, PCIL, L&T Infotech, Godrej Infotech, I Gate Patni, Sri Ram Group of Companies, Videocon, Nippon Toyota, SAP, KPMG, Federal Bank, South Indian Bank, ICICI Bank, HDFC Life etc.

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FISAT— focus on infrastructure and placement ederal Institute of Science economically weaker but meriand Technology (FISAT) is torious students are studying in an educational enterprise FISAT under Fee-waiver scheme. of Federal Bank Officers’ Asso- The institute has crossed excelciation Education Society, started lent existence of 11 years and has in 2002. Hormis Nagar at Mook- launched projects like Decennial kannoor is proud of accommo- homes to poor as part of its Decennial celebration,” dating it in a sprawling said Paul Mundadan, 40 plus acre land and FISAT Governing body 5 lakh plus square feet Chairman. built-up area. There are Paul, a native of Anmore than 3,000 stugamaly and presently dents studying in variresiding at Ernakulam, ous streams of BTech, is also Manager in CorMTech, MBA, MCA and also it is a research Paul Mundadan porate Service Department of Federal Bank centre of MG University. The college has all infrastruc- Ltd. Apart from this, currently he ture, facilities and a very high adorns the positions of All India percentage of placement service General Secretary of Federal Bank Officers Association (FBOA), in highly reputed companies. ``Focus to Excellence and Com- General Secretary of FBOA Edumitment to Society is the motto cational Society, Trustee of Horof the institution. Upholding its mis Memorial Foundation, State social commitment, hundreds of Senior Vice President of All In-

F

dia Bank Officers’ Confederation (AIBOC), General Secretary of All India Private Bank Officers’ Federation (AIPSBOF).

Early he had held positions like Kerala State Secretary of Kerala Catholic Students League (KCSL), National President and acting President of All India Catholic University Federation

(AICUF), Asian Council Member of International Movement of Catholic Students (IMCS) and has visited several foreign countries and was also the Charter General Secretary of United Nations Youth Organization (UNYO-India). His family consists of wife Mary Paul and two sons Jithin and Joyal.

SNGIST aims at holistic development of students

S

NGIST Group of Institutions was given shape by a few broad-minded persons with a deep commitment to provide equal opportunity for all people across beliefs, geographies, and ethnicities on the broader theme of the great visionary thinker and philosopher, Sree Narayana Guru: “Through education we prosper”.

ics & Communications, Civil and Computer Science) Management Studies (MBA) Computer Applications Studies (MCA as well as Dual Degree MCA) Life Sciences Studies (MSc Biochemistry, Biotechnology, Microbiology, Bioinformatics)

Dr K S Divakaran Nair

Formed in 2001, Gurdeva Trust promoted SNGIST Group of Institutions, in 2003, with management, computer applications, and life sciences courses. In 2010, SNGIST started offering engineering courses and in 2011, commerce and business courses. Today, SNGIST has five main streams, as follows: Engineering Studies (BTech in Mechanical, Electrical, Electron-

Commerce & Business Studies (BCom, BBA,

MCom) SNGIST Group of Institutions has 23 courses, close to 2000 students, 147 Faculty and 92 nonteaching personnel.

SNGIST Group of Institutions just does not believe in preparing students for degrees but strives towards the holistic development of personality: physical-

mental-social-spiritual/ ethical base (encourage students to take to playgrounds, yoga and meditation), so that learning penetrates, education becomes contextual and meaningful.

Paravur, fructified in the formation of ‘Entrepreneurship Development Cell’ which was formally inaugurated on 19th September 2014 by Sarath

Babu Elumalai, CEO of Practical bias is the Food King, Chennai. hallmark of SNGIST Linkage with TechGroup of Institutions: nopark Incubation industrial visits, visits Centre:T-TBI, the incuto R&D/ laboratories/ bation centre of Techscientific institutions, nopark, sanctioned the Prof C K Renjan live industrial projects, organisational study, field IEDC of SNGIST. The possible work and industry internships; so benefits of SNGIST through this that students are able to better un- incubation centre are: SNGIST derstand, appreciate, criticise and can source innovations and forward them to Technopark TBI for reflect/ relate practice to theory. further technical assistance.

SNGIST EDC CELL The students, whose projects are The efforts of the faculty and stu- being sanctioned, will get grace dents of Sree Narayana Guru In- marks for the university examistitute of Science and nation as per the guidelines of the Technology (SNGIST), North government.

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H

oly Grace Academy of Management Studies (HGAMS) is a fully residential B-School recognized by AICTE New Delhi and affiliated to Calicut University conducting a PG programme in Business Administration. HGAMS prepares its students to understand key interactions among the functional areas of a business system and apply key concepts to arrive at meaningful solutions.

According to Chairrman Vackachan Thakkolkaran, “Holy Grace Academy of Management Studies strives to give the best features of the global management education”. HGAMS is the largest residential B-School in Kerala with more than 81,000 sq ft of built in space.

Located just 15 km from Kochi International Airport, HGAMS is located away from the hustle and bustle of the city amidst lush green and tranquil environment, perfect for preparing tomorrow’s career-oriented executives.

HGAMS is A-rated by All India Management Association and is an exclusive coed B-School of the State. HGAMS is the second offspring of the Holy Grace Foundation, Mala, which has carved a niche in the field of education by offering unique style of teaching methodologies. The group has a 10-year old CBSE school Holy Grace Academy which imparts education with a difference by providing smart class rooms and a well-defined innovative pattern of study. Holy Grace Academy of Engineering offers high quality technical education through state-of- the- art facilities to develop future scientists and engineers through problem identification, modelling, simulation and evaluation.

Holy Grace Academy of Management Studies started its jourPASSLINE

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ney in 2005 and since then it has been consistently pursuing its mission of excellence with great zeal and perseverance in the area of management and research. The programme, Masters in Business Administration, it offers, is a complete industry-endorsed package with the University syllabus at its core, and all that the industry needs strategicallybound around as super competency add-on modules. It stands out from the usual unpromising rut in its content and design so much that it sounds to aspirants as ‘MBA with a difference’.

Objectives of the MBA programme: The PG programme in Business Administration at Holy Grace is intended to prepare the students to understand key interactions among the functional areas of a business system and apply key concepts to arrive at meaningful solutions. The programme focuses on a Global outlook and grooms young men and women to become future business leaders. The core idea of the programme is to inculcate confidence, improve communication skills, develop personality and give exposure to multi-culture.

Spread over 2 years (4 semesters), the programme specifically aims at: • Imparting state-of- the-art knowledge of the concepts and techniques of management.

• Developing the ability to comprehend the changes in the business environment.

• Imparting analytical and decision-making skills.

• Fostering a novel approach to core areas of work, irrespective of the undergraduate specializations • Producing people with right kind of value systems and culture to work for society as well.

Vackachan Thakkolkaran Chairman • Developing programmes that meet the quality expectations of students, employers and stakeholders.

• Obtaining comprehensive and current information about management education.

• Locating professional development programmes to keep administrators, faculty, and academic programmes current and effective.

Students without appropriate foundation business course experience will be required to complete additional coursework in quantitative methods, economics and business psychology.

Features of the MBA programme: • An enriched curriculum running for about 1000 hours per semester.

• Personality development programmes like simulation

exercises, role-plays, case analysis, psychometric tests, group works etc.

• Curriculum revised and updated every year based on faculty interaction with employers • Competent and committed faculty having industrial experience • Interactions with leading industry practitioners • Unique 16 weeks Summer Internship Programme • 100% placements assistance • On-the-job-training arrangement • On-line share trading experience • Executive education programmes, in-company training programme, seminars, and workshops for continuing professional education

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dition to contributing to their computer wizardry. To top it all, the J-Gate and ProQuest databases to which the Academy is a regular subscriber, offer full text referencing of about 8000 world-class academic journals.

Following courses are also included in the curriculum based on the trends and the requirements of the market: • Retailing • Supply Chain and Logistics Management • Advertising Management • Enterprise Management • Banking & Insurance Management K T Benny Secretary • Fully equipped Wi-Fi computer lab and library • Focus on Indian and International Case Studies • Global Affiliations The students at Holy Grace are equipped with a holistic outlook towards life based on ethical values; and social responsibilities have many first to its credit.

1. The first institute in Kerala to be accredited by IAO, and ACBSP, USA 2. The first B-School in Kerala to offer International study tour to China, Singapore, Paris & Germany.

3. Confidence building outbound training programmes like paragliding, rappelling, rock climbing and cave exploration under the guidance of Air Force personnel.

4. Corporate-Academia Interaction by top Management Executives and entrepreneurs.

5. Training modules on domains ranging from soft skills, Statistical packages, share broking and corporate finance drills.

with evaluations on periodical basis. The students in their first year are given ample exposure to basic management subjects, which later branches into specializations of their choice during the second year.

The course curriculum of Holy Grace Academy of Management Studies includes Industrial Training and work project. In addition to these the students have to undergo training, development programmes, seminars, workshops, and skill enhancement programmes of various magnitudes at regular intervals.

• Performance Management In addition, the MBA programme starts with a twoweek orientation programme called Course Immersion Module, which offers introduction to: • Accounting.

• Business Statistics • English Language skills

Specialisations: Every student will study subjects based on the electives opted for. The electives are chosen from the subjects listed herewith while the industry internship and project will be based on the student’s preference. Students are required to choose any two streams (Dual Specialisation) from the list of electives given below:

Indicative List of Electives For Semesters 3 & 4

• Soft Skills Development

1. Marketing

6. Wi-Max and Wi-Fi enabled campus

• Team building, Ethics, Business Communication.

2. Finance

7. Physical and psychological nurturing through out-door and indoor games and sports like Football, Cricket, Volley ball, Billiards, Tennis and Yoga.

• Train the trainer

4. Human Resource

• Theatre workshop

5. International Business

8. Contributes to the body of knowledge through research publications and International conference A virtual library with most advanced IT Bay keeps students updated and profoundly informed of the happenings of the business world, in ad-

Holy Grace Academy of Management Studies curriculum is designed to give students an extensive understanding of the disciplines like Marketing, Finance, Human Resources, Operations, and MIS. Spread over Four semesters, the course includes an extensive pedagogy which is rigorously followed catering to the needs of its students. HGAMS follows a credit semester system

3. Systems

The institution provides ample placement opportunities and hosts recruiters such as Aditya Birla, KPMG, Raymond, HDFC Bank to name a few.

The institution also provides placement training and soft skill development programs conducted by industry as well as academic professionals. Institute also facilitates industry interaction through internships.

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B

harata Mata Institute of Management (BMIM) of Kochi fostering different attitude towards education and adopts a unique way to managerial education and training. It is not simply nurturing business-savvy managers but grooming economically committed human beings. It is also nurturing socially committed managers.

Unlike most well-known Bschools which produce just management robots, BMIM engages itself in shaping socially committed management professionals.

And the college knows that bringPASSLINE

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ing out socially committed managers is just like extracting diamond from coal. But this is what it has been doing since its establishment in 2005.

agement expert is the outcome of an experienced management resource. BMIM has been established to serve as a centre for training future managerial experts.

In this era of globalization where the economy is the supreme power for sustainable development, management experts serve as an axis power. The development of industries and the economy is vested in the hands of management professionals. Analysing each minute change in the economy and creating new tactics for development are not easy tasks in a competitive economy. A successful man-

BMIM, under the decades-old Bharata Mata College, is affiliated to Mahatma Gandhi University, Kottayam, and approved by the All India Council for Technical Education (AICTE). A nationally accredited institution of higher learning, BMIM is owned and managed by the archdiocese of Ernakulam-Angamaly.

Nestled in all sides of a devel-

oped township of Greater Kochi, proximity to the industrial hub of Kerala backed by the prestigious Smart City, nearness to the Cochin International Airport at Nedumbassery—with all these facilities and future opportunities, BMIM provides the best ambience for nurturing and nourishing entrepreneurial spirit in its students. ``BMIM believes that what human mind can conceive can surely be achieved. We are holistic in whatever we do. We empower our students to achieve more. Our watchword is flexibility, planning,

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guarantees 100% job assurance.

The coaching given is meant to create managers with a wide vision of social commitment and humanitarian considerations for fellow beings.

The experienced faculty members also focus on shaping the students into first-rate citizens, apart from providing the usual curriculumoriented training. They also help them acquire soft skills. Thus BMIM is preparing for a revolution in the field of management studies with a different approach

to training students. ``Today’s students are tomorrow’s citizens. The future of the nation should be safe in their hands.

It does not matter whether the students are from management or technology wings. Social commitment and a humanitarian approach go a long way in making good citizens. BMIM’s role is to help its students become good citizens. We want to make the coaching that we give a brand in itself,” this is what the college says.

RECRUITERS Rev Dr Varghese Kalamparambath

patience, commitment, humility and networking. We give comprehensive training to students with special emphasis on making them responsible citizens having a secular outlook, moral values and abiding faith in God expressed in active concern for others,” says Rev Dr Varghese K V, Director of BMIM, about the institution’s secret of success.

MNCs and other companies like Max New York Life Ltd, Reliance Telecom, Apollo Tyres Ltd and Tata-AIG Life are the college’s industry partners. A dynamic and vibrant placement cell (See Box)

1) ENVESTNET 2) WINBLESS SOLUTIONS 3) SYTEL 4) WIPRO 5) HCL 6) EY 7) KPMG 8) ACCENTURE 9) ANZ 10) PRERNA GROUP, DELHI 11) ICafS TECHNOLOGIES P LTD 12) ASIAN PAINTS 13) SYNTHITE 14) ICICI PRUDENTIAL 15) REDEFINE ibs 16) KOTAK MAHINDRA BANK 17) MAHINDRA FINANCE 18) CLUB MAHINDRA 19) MAGIC HOLIDAYSOANORAMIC GROUP 20) SUTHERLAND GLOBAL 21) IBM 22) FRAGMON INDIA 23) Royal Bank of Scotland

24) L&T FINANCE 25) LIFE CELL INTERNATIONAL 26) SIGNET ID AUTOMOTIVE SYSTEMS 27) DBFS 28) UAE EXCHANGE 29) THOTSLAB 30) THYROCARE 31) MEDLAB 32) LONICERA HERBALS 33) FACE 34) MGF AUTOMOTIVE 35) TVS MOTORS 36) ICICI BANK 37) HDFC BANK 38) ZEBA LABS 39) KEYS HOTEL 40) BEUMONDE THE FERN 41) XStream Software (India),

Pvt Ltd 42) South Indian Bank 43) Axis Bank 44) Deloitte

Jan 15 - Feb 15, 2016

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Are you satisfied with your bank ?

PASSLINE NEWS SERVICE

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as your bank suggested an investment or financial product to you recently? There’s a 60% chance that the product will not suit your needs. An online survey shows that three of five customers found products suggested by their banks either not very suitable to their needs (38.6%) or not at all suitable (22.5%). Peddling unsuitable investments is a serious transgression by an establishment you trust.

code of commitment to customers that all banks have signed up for. The quasi-regulatory body conducted a study and found that compliance improved significantly in 2014 compared to the previous year. But only 14 of 47 banks included in the study secured a High rating and only one was a PSU bank. This means that a large section of the population is not getting the High level of service it rightly deserves.

Banks are one of the worse offenders when it comes to misselling. Posing as customers, we approached several banks for financial advice. Most advised us to buy traditional endowment or money back policies, even though these offer very low returns and inadequate insurance.

Irked by the rising number of complaints against mis-selling, the insurance regulator has decided to make banks liable for the insurance policies they sell.

A bigger issue are the high charges levied by private and foreign banks. Their service is very efficient, but the price tags can be

More than 36% of respondents to the survey want banks to stop peddling unsuitable financial products. “Mis-selling is a violation of the code of commitment.

Aggrieved customers can take recourse to the grievance redressed mechanism,” says Chairman of Banking Codes and Standards Board of India. We suggest a stiffer penalty: if your bank is guilty of mis-selling investments, it is time you switched to a better establishment. Many customers don’t consider this option because of the hassles of changing a bank. However, we believe one should not prolong a painful relationship. Mis-sellling is not the only problem. High charges, inefficient service and high-handedness in levying penalties are other pain points. According to the Banking Ombudsman report 2014-15, the number of complaints against banks rose 11% compared to the previous year.

The BCSBI has established a PASSLINE

Jan 15 - Feb 15, 2016

High charges on services

banks slap late fee and penal interest without sending reminders in case their card payment is delayed.

Interestingly, the RBI has directed banks not to levy a late payment fee if credit card payment is delayed by up to 3 days.

Not many customers are aware of this. If your bank has slapped late payment charges, take up the matter with the grievances committee. Then approach the Banking Ombudsman.

Use of technology The era of the friendly neighbourhood bank is on its last legs. Most

in terms of technology, consider switching to a more up-to-date establishment.

Unfavourable rules A few years ago, K C Chakrabarti, the then Deputy Governor of RBI, had said a banking agreement is heavily stacked in favour of banks. ``The agreement is so worded as to afford no right to the customer. Banks are not responsible for any unauthorised transactions even if carried out by employees. The onus should be on banks to prove that the customer has compromised his user ID or password.’’ he had said.

After the code revision in January last year, the onus has now shifted to banks. However, the legalese in banking agreements continues to be tilted in favour of banks.

Lower rates of interest

shocking. One bank charges Rs 1,000 a year for its investment services account that facilitates investments in mutual funds. Another levies a penalty of Rs 750 if you don’t maintain the quarterly balance. A bounced cheque can leave you poorer by Rs 300-500.

Cash withdrawal of Rs 50,000 in a day can invite a Rs 500 charge.

For customers, things have worsened due to changes in rules. Last year: the RBI placed a cap of 5 free ATM transactions in a month.

If you exceed the cap, there is Rs 20 payable on every additional transaction. More than 52% of respondents want banks to reduce charges on products and services.

Lack of transparency What many customers find galling is that these charges are not clearly communicated. Over 45% of those polled complained their

banking activity has now moved to ATMs or the internet. Four out of five respondents rarely visit their branch. This is why inconvenient working hours and inaccessible location did not figure high in the list of things wanted changed.

However, the shift to online banking and ATMs is possible only if the bank invests in technology. Some PSUs and small private banks are not very adept at this. Websites facing downtime, ATMs out of order, delayed re-crediting of failed transactions and non-availability of Net banking on weekends are a turn off.

Likewise banks that do not adapt to technology-driven applications are bound to fall off customers’ radar. If your bank is not measuring up to industry standards

After the RBI liberalised savings bank account rate, some private banks started offering customers an interest rate of 5-7%--higher than the regular 4%. Assuming the balance in your account is Rs 1 lakh, you earn Rs 167 less every month as interest if you choose to retain the account that pays 4%. Other factors remaining constant, there is no reason why you should not move on to a bank that values your money more.

Poor product portfolio A bank ought to offer differentiated products to be worthy of your loyalty. For instance, the `sweep in sweep-out’ facilities that many banks offer help you earn higher interest on your savings account balance as amount above a threshold is automatically transferred to an FD. This way you avoid keeping a big sum in a low-yielding savings account.

While some banks allow you to book even seven-day deposits, others insist on tenure of at least a year. Go with the bank that offers more flexibility.

FAMILY SPENDING

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Passline News Service Hereditary plays a pivotal role in the spending habit of a person.

During your bachelor life you may be ignorant of the world of budget spending. But, in post marriage, it implies that you and your spouse have different attitude toward money.

For example one may be more lavish to spend while the other may be inclined to save. Most probably, the prodigies follow the patterns they had learnt and practiced by their parents . So it takes time for a couple to adjust and develop an agreed-upon method of handling money. Mind it , money is a ripe area for conflict.

It is quite obvious that when the expenses exceed earnings all of us have the tendency to postpone the payments of various consumer bills payable monthly or bimonthly. This procrastination results in accumulation and aggregation of the amount which cannot be paid without borrowing or availing a loan which again ending in further monthly remittances in the form of installments. A newly married couple will always spend little more for their travel, buying gifts for their friends and relatives and also for the fun and enjoyment without caring their income and the priorities they have. If they use credit or debit cards or the internet for making their various payments there are immense possibilities of overspending because one cannot see the money leaving his / her wallet or purse. The lure of easy credit can also make it easy to overspend. That causes the family to run out of money which invites fracas among couple. Instead of blaming each other, work as a team to bring spending under control.

Decide at the outset that you will not allow this issue to create a hiatus between the spouses.

To lead a peaceful and happy life it is utterly necessary to prepare a financial budget to control your spending. Write down all of your expenses for a month, no matter how small or big they are.

That will help you to figure out where your money is going and to identify any unnecessary ex-

In short, a decent life depends on such factors like compassion, communication and compliance; and a stable family is simply based on three Ls of the English alphabets.

That is the first L for Labour of the father; second L for Love of the mother and the third L for Laugh of the baby. penditures. Make a list of your necessary expenses, including food, clothing, rent or mortgage, car payments and the like. Put a price tag at each item projecting how much it will cost you within a given time, perhaps a month.

Allocate funds each month for separate expenses (food, rent, fuel and so forth). Some do this putting cash in envelopes, one for each expense category. If an envelope becomes depleted, the couple will stop spending in that category or transfer money from another envelope.

Happiness does not depend on having the latest things. Gener-

ally, luxury has no last word in latest things. Day by day it brings costly, gorgeous, fabulous and gigantic gadgets in the market which has old substitute which is out of date; but if in use capable of meeting our needs. Unless our budget permits never go out of range to have such status symbols. Things like car, cable TV and food- out may sound affordable at first, but they can burn holes in your pocket. We have to practice to say no to certain things in order to live within our means.

Even if one person in a family handles the finances and pays the bills, other adults should be fully informed about their financial status. Communication goes a long way in preventing problems.

Plan ahead. Don’t assume that all the money you have in the bank is available to spend. If you don’t keep money in reserve, you’ll never be prepared for emergencies.

We over run our financial barriers most often to stand shoulder to shoulder of our rich neighbours, colleagues or friends. As and when the family grows the income should also grow; otherwise the earning of one member in the family is insufficient to meet all the financial needs of the inmates. In such a situation, husband should think of another earner in the family. In today’s world we see both spouses earn for a better living and saving for the future.

In short, a decent life depends on such factors like compassion, communication and compliance; and a stable family is simply based on three Ls of the English alphabets. That is the first L for Labour of the father; second L for Love of the mother and the third L for Laugh of the baby.

Jan 15 - Feb 15, 2016

PASSLINE

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Passline

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