Passline Business Magazine May 2012

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PASSLINE

April 30-May 31, 2012

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From the Editor Is there a flight of capital from the country?

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Editor & Publisher

VARGHESE PAUL Kochi

ZIAD SIDDIQUE Ph: 8089490231

KISHA KRISHNAN Ph: 8086542695

MANILA M Ph: 9496885386 Thiruvananthapuram

RADHIKA C PILLAI Ph: 9447712290

Chennai

AUGUSTINE JOSEPH Ph: 09381000534

Manager-Marketing

SAJAN K

Keethara Publications Pvt Ltd 38/125 1st Floor, Narakathara Road, Kochi-682 035, Kerala, India.

Phone : +91 484 4027002 Editorial

: +91 484 3043572

t is high time we had some deliberations on and self-assessment of the fate of the Indian economy because some people who are part of the ruling United Progressive Alliance (UPA) at the Centre headed by Dr Manmohan Singh seem to be sceptical about the reforms and policy initiatives to boost the economy, at least for a couple years. These are the words of Dr Kausik Basu, the economic think tank and economic Adviser to the Government of India: “You are not likely to see any major reforms till the election of 2014—after which you will see a rush of them”. Though this created a flutter in Congress circles, it is the real state of the regime of Dr Singh who himself is an eminent economist and the face of Indian market reforms. It was during Dr Singh’s tenure as Finance Minister that the country witnessed the opening of the Indian economy in the early 1990s. Now Dr Singh has become a mute spectator to all the economic mess-up which he himself attributes to ‘coalition dharma’.

Investors in the Indian economy, whether foreign or domestic, look for a conducive and liberal economic climate and reasonable returns on their investments. We should not forget that India has been ranked number two after China among the Asian countries in economic growth.

Of late there have been murmurs among investors and industry captains about the trust loss in the UPA and the economy. According to Mr Adi Godrej, the new President of the Confederation of Indian Industry (CII), there is no trust loss but only a ‘negative perception’ which has emerged among investors. Whether it is trust loss or perceptional change, one thing is clear: the economy is not considered a darling destination by investors. The never-ending expectation of opening up the economy for 100% foreign direct investment (FDI) in the multi-brand retail sector, reforms in the pension and provident funds, delay in environmental sanctions for mineral and metal mining, devaluation of the rupee and the squabbles between and among the coalition partners have already created a vexed situation for the economy. The recent downgrading of the economy by Standard & Poor from stable to negative has made Indian industry cough up more value for its borrowings from abroad. The Vodafone imbroglio and the telecom regulator’s proposals for a steep increase in spectrum prices have not gone down well with the players in the sector. The tax uncertainty due to the proposed general anti-avoidance rule (GAAR), roll-back of the rail fare increase and status quo on petrol prices have wreaked havoc on the Indian share market. As a result, the net inflow from investors abroad into Indian shares has come down to a trickle in recent weeks. After pumping in about Rs 44,037 crore in the Indian stock market in the first three months of this year, foreign institutional investors (FIIs) pulled out Rs 600 crore in April itself. The National Stock Exchange (NSE) benchmark, Nifty, which delivered 15% returns in the first three months of 2012, had fallen by 2% in April.

Marketing : +91 484 4010075 484 3043325 Marketing Office: G-238, K C Joseph Road, Panampilly Nagar, Kochi-682 036 Marketing : +91 484 4010075 e-mail

We must check the exodus of investors and capital from Indian soil for which the Government must wake up from its slumber and take proactive steps for confidencebuilding among investors. Dr Singh and company are capable of handling the situation without any hassles. Today the problem has not become cancerous, but it may go out of hand because the world is expecting another recession in 2013 which, by all accounts, may be worse than the earlier ones.

: passline.com@gmail.com

Varghese Paul

PASSLINE

April 30-May 31, 2012

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O

nly 25% of India’s engineering graduates are employable in the IT industry, says Kris Gopalakrishnan, CoChairman of Infosys Technologies, quoting a NASSCOM-McKinsey survey that came out a few years ago. In an email interview to PASSLINE, Kris says that In India, the focus of a majority of academic institutions has been on ramping up technical skills. However, the need of the hour is to address certain broad-based skills that go beyond textbook learning. “We must focus on increasing the quality of the workforce as we increase the quantity of graduates,” he says.

The following is the text of the interview: As India’s largest IT sector recruiter, what is your opinion about the quality of our new-generation graduates? Do you think they are industry-ready and are capable of meeting the growing market demands?

A NASSCOM-McKinsey survey that came out a few years ago states that only 25% of India’s engineering graduates are employable in the IT industry. In India, the focus of a majority of the academic institutions has been on ramping up technical skills. However, the need of the hour is to address

certain broad-based skills that go beyond textbook learning. We must focus on increasing the quality of the workforce as we increase the quantity of graduates.

The skill gap between industry and academia is a universal issue. Based on our past experience, we see that this gap lies in three areas: lack of critical thinking; inability to apply theoretical concepts to solve problems and inability to function as a team.

At Infosys, we invest heavily in training and educating our workforce.

Fresh recruits at Infosys are put through a 23-week residential programme which includes a lot of hands-on work to help graduates bridge any existing skill gaps. Additionally, Infosys provides new recruits with soft

skill training and projects aimed at developing teamwork.

Could you describe Infosys’ vision on employee satisfaction?

We believe that new graduates will be able to meet market demands through comprehensive training programmes with a focus on eliminating skill gaps.

Our vision is to become a ‘globally respected corporation.’ Our employees are our greatest assets and we constantly look to improve our performance as an employer by listening to our employees and taking their feedback. We believe that constant and transparent communication with employees is critical to employee satisfaction. We conduct an annual employee satisfaction survey, LITMUS, to capture, analyse and draw actions to address the concerns of employees.

The findings of the survey are analysed and action points are identified. This process helps us to build a stronger and highly engaged workforce.

What kind of curriculum do you think should be introduced to improve our higher education system?

Engineering colleges tend to focus more on the theoretical aspects of concepts without paying heed to the application of this knowledge. Aligning assessments with learning objectives, rather than course content, can help students learn more effectively.

Industry and the Government must continue to invest in improving the quality of engineering education as well as education in general. Students must be given opportunities to work in teams and participate in competitions to gain exposure to the corporate requirements. The faculty must also be urged to constantly update themselves with relevant curricula by attending workshops, through sabbaticals etc. Industry must proactively reach out to the academia to conduct programmes to enhance the quality of the workforce.

nology (IT), application of IT in the business and business model innovation.

In the future about a third of our revenues will come from such innovations.

What is the strategy Infosys has evolved to tap the emerging opportunities in Asia in general and In-

Why is the IT sector narrowing down to engineering stream students alone?

First and foremost, we need em-

For the last few years, the IT sec-

tor has been in the forefront for recruiting huge workforces and this trend is expected to continue in the coming years. What are the specific qualities that you expect from aspirants?

As mentioned earlier, we have seen that fresh engineers have skill gaps in three areas—critical thinking, communication skills and the ability to function as a team. The IT sector looks to recruit engineers who can think critically, have the ability to apply concepts to real-life situations, can work to function as part of a team and communicate clearly. At Infosys, the main criterion for hiring graduates is learnability which can be defined as the ability to make generic conclusions from specific instances and apply them to new problems and new situations.

PASSLINE

ployees who can interact with our global clients, capture their requirements, develop solutions and deploy these. In our case, 97% of revenues are from international clients. Second, we need a mechanism to identify the best students from the overall pool to recruit. It is easier to use a subset— engineering graduates—to recruit from. Third, we need employees who will grow with the organization—from software engineer to project manager to general manager.

How innovative is Infosys?

Infosys spends about 1% of its revenue on R&D. We have created Infosys Labs with a dedicated staff of about 600 professionals. They undertake research in the areas of software engineering, advances in information tech-

April 30-May 31, 2012

dia in particular in view of the fact that the opportunities provided by the US and Europe are declining?

We have increased our focus on geographies other than the US and Europe in line with our strategy to reorganize the distribution of our revenues from the US, European Union and the rest of the world from the present 65:20:15 to 40:40:20.

We have been expanding our presence in the APAC region and announced the opening of a new development centre in Singapore. The Singapore DC has a provision to accommodate 450 seats spread over 25,000 sq ft of space on two levels at Changi Business Park.

Our investments in Singapore till now are greater than $5 million.

5 Confusing coins Coin shortage is a problem people often face, especially during travels and while making small buys. The same is the case with the dimension and weight of the coins of today. Small-denomination coins of Re 1, Rs 2, Rs 5 (silver colour) and even 50 paise get exchanged wrongly. This usually occurs among aged people or people with poor eyesight or lack of observation. This may cause tiffs between people or losses to the taker or the giver.

Readers' views Snapaka Yohannan skipped The late Mollywood giant Jose Prakash leaves a legacy for the future film world as villain first and hero at random (April issue). His memorable role as Snapaka Yohannan in the erstwhile Neela Productions’ film of the same title, the magnum opus adopted from biblical stories, was unique. No writeup or profile of Jose Prakash will be complete without mentioning his down-to-earth portrayal of the biblical character.

It is high time the Government took extra care to maintain variety in size and colour as earlier when the anna and naya paisa were swapped without any difficulty.

-A V Joseph, Alappuzha

Re-launch ideal Thanks to the end of the newspaper agents’ strike the pubic right to information has been restored after much dust and fury was raised in the air. It is not known who were the gainers or losers in the war of words. Surely, there may be some losers or gainers. One national English newspaper, which launched its Kerala edition during this period, might not have got the opportunity to know the attitude of the Malayali readers towards their daily with its combo offer along with a major vernacular daily. It may be ideal for the paper to re-launch its publication in a new mode at a new and cheaper cover price and as a single entity like other English dailies.

-A reader,

Kochi

-Zubin, Kannur

Helping society T he article on V-Star and Mrs Sheela Kochouseph, wife of V-Guard founder Kochouseph Chittilappilly (April issue), is a catalyst for bringing out the latent talents of human beings, especially of women. There are lots of women in society who have the urge to launch their own ventures but often are discouraged or frowned upon by friends and even husbands of affluent families in the name of status and reputation.

Cheque for gold loan Close on the heels of pruning lending to 60% of the market price of gold kept as collateral, now the buzz is that the central bank is planning to limit the amount of cash that gold loan companies can give to their customers. The most likely change in rules could be that beyond Rs 50,000 per loan, the advances should be through cheques.

At a time when women clamour for equality with men it is significant and praiseworthy that women of Sheela’s stature are coming forward to inspire others to venture into enterprises of their own so that they can help the weaker sections of society. Sheela herself is an example, perhaps inspired by her own husband, of how women can help society physically and financially.

The move is aimed at limiting the use of hard cash in this lucrative business.

-Baby C I, Arattupuzha In addition, we continue to expand operations in China. The expansion of Infosys’ operations in China is an integral part of the company’s long-term global strategy. Our focus is in two areas, namely China as a market and China as a talent base for global delivery.

Though currently a majority of our revenues are from offshore services, there is positive growth in the services performed for the local operations of multinational companies and local Chinese clients. Clients have expressed confidence in working with Infosys China.

As part this long term strategy, we have been investing and expanding our operations across various locations in China. In FY 2011-12, Infosys China reported revenues of $25.98 million on a standalone basis and employed 3,092 people.

Infosys has four development centres in China—Shanghai, Hangzhou, Beijing and Dalian—with the total capacity close to 5,000 seats. We also have an Education Centre in Jiaxing city. In 2011, we laid the foundation stone of a new campus at the Zizhu Science and Technology Park in Minhang district of Shanghai. We plan to invest between $125 and $150 million in the new campus, one of the largest investments in China by a software company. On completion of this cam-

pus (estimated by 2013), we will have capacity to expand up to 10,000 employees in Shanghai.

change? Are you looking for more investment in the state in this changed atmosphere?

We have over 400 employees in Japan, including employees who are deputed at client locations.

Earlier this month, Infosys signed a memorandum of understanding (MOU) with the Government of Kerala for the allotment of 50 acres of land in Technocity (SEZ) in Thiruvanantha

Kerala has become an industryfriendly state. How do you view this

puram. We will be developing the campus in three phases with a total investment of Rs 600 crore, and the campus will have a seating capacity of 10,000 on completion. In the first phase of this project, we are making an investment of Rs 180 crore and developing seating capacity of 3,500.

A business and technology thought leader Senapathy Gopalakrishnan, popularly known as Kris Gopalakrishnan, is the Co-chairman of Infosys Technologies, a global consulting and IT services company based in Bangalore. He is also one of its seven founders. Kris had his school education in Government Model School, Thycaud, Thiruvananthapuram. Kris obtained his MSc (Physics) in 1977 and MTech (Computer Science) in 1979, both from IIT-Madras. He started his career as a software engineer with Patni Computers, Mumbai in 1979.

When Infosys was founded in 1981 Kris served as Director (Technical). Between 1987 and 1994, he served as the Vice-President for Technical Operations of KSA/Infosys, a joint venture between Infosys and KSA, US. In 1994, he returned to India and was appointed Deputy Managing Director of Infosys. Before becoming the CEO and Managing Director in July 2007, Kris served as Infosys’ Chief Operating Officer, President and Joint Managing Director.

He took over as the Executive Co-Chairman on August 21, 2011.

PASSLINE

April 30-May 31, 2012

Recognized as a global business and technology thought leader, Kris was recently voted the top CEO (IT Services category) in Institutional Investor’s inaugural ranking of Asia’s Top Executives and selected as one of the winners of the second Asian Corporate Director Recognition Awards by Corporate Governance Asia. He was also selected to Thinkers 50, an elite list of global business thinkers compiled by Des Dearlove and Stuart Crainer, in association with the IE Business School, Madrid, and the London Business School’s Management Innovation Lab. The Government of India awarded Kris the Padma Bhushan, the country’s third highest civilian honour, in 2001. He has also represented Infosys and the country in several international forums. In April 2012, Kris was appointed member of the reconstituted United Nations Global Compact Board for three years.

Kris is the President Designate of the Confederation of Indian Industry (CII) National Council and is on the Board of Governors at the Indian Institute of Management (IIM), Bangalore and is the Chairman of the Indian Institute of Information Technology and Management (IIITM), Kerala. He is a member of ACM, IEEE and IEEE Computer Society.

COVER STORY

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Can Kerala profit from ‘Gujarat Model’?

The race for growth is on

Oomman Chandy replicating Modi model in Kerala?

Passline News Service

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hen someone asks someone else what kind of economy they would want to see for Kerala, they would have a stock answer: Gujarat. Why Gujarat?

Because people are a bit liberal these days, and Gujarat has recently been the exemplar of what is called the ‘middle way’, a market economy with the rough edges smoothed by generous Government programmes.

One would be startled by Gujarat’s unmistakable buzz of prosperity. First impressions are confirmed by the statistics. It arguably is the country’s most progressive and developing state industrially, and the ‘Gujarat Model’ is creating wonders. It has a flourishing economy, with significant growth and a very low unemployment growth rate.

Its per capita GDP is 2.4 times the Indian average and GDP growth rate 10.6%. India cannot achieve 8% growth rate without Gujarat getting closer to 12%.

Projections also show that if it was a nation it would have been the 67th richest in the world above many European and Asian economies like Taiwan and Ukraine.

Gujarat holds several records. It has 20% of India’s industrial output and 80% of diamond, 50% of natural gas, 54% of crude oil, 45% of pharmaceuti-

News from those in power and several other quarters and views of many inform the world that Kerala is no longer the risk-fearing, conservative, tradition-bound society it once was. It no longer appears to be the impenetrable fortress it used to be. Just a few years ago Kerala’s investment potential was nil. Today, however, investor attitudes have changed. The Government itself ends up meeting industrialists and industry organizations. Special road shows are arranged and investment meetings are held. There is a feeling gradually getting round that investors won’t lose money in Kerala. cal and 47% of petrochemical production. Of the country’s exports, Gujarat accounts for 22%. Among the 10 richest Indian people four are Gujarati— Mukesh Ambani, Anil Ambani, Azim Premji and Tulsi Tanti. The average income of a Gujarati family in North America is three times more than that of an American family. It is the first state to implement the BOT law for encouraging private-sector participation and the first to provide uninterrupted 24- hour two-phase electricity to all villages. Agricultural production there has increased fourfold in five years. Gujarat stood first in the country with investments of $17.8 billion in 2006-2007 or 25.8% of India’s total investments of $69 billion during the year.

Not only has Gujarat unseated Maharashtra as India’s number one investment destination but it is threatening to dislodge Mumbai, Maharashtra’s capital and the financial and business capital of India, as the PASSLINE

trade gateway to the country.

The list of Gujarat’s achievements and the firsts to its credit is endless.

How does Gujarat manage this turnaround? Does it adopt an Americanstyle regime of low taxes, winner-takeall markets and profits? The state remains extremely generous to industrialists and would-be investors. The formula that the State Government under the leadership of Narendra Modi seems to be following is that its ‘new economy’ is receptive to modern information technology combined with an industrial policy that has let the economy take advantage of higher growth potential.

Now let us look at an entirely different picture of another state—Kerala.

Here is someone who has been closely observing the development activities in the state since 2002. He is Mr L N Sethumadhavan, former Senior Deputy General Manager, Larsen & Toubro Limited-Hazira Works, Surat (Gujarat).

April 30-May 31, 2012

After his retirement in 2002 from L&T, he has been living in Kochi. He says that in that year, the Kochi Corporation conducted a workshop to formulate a ‘Kochi beyond 2002 Vision Document’ and he made a presentation on “How Surat City got transformed from the filthiest city to one of the cleanest cities in India in just 18 months, attracting massive investments.” In 2003, the Kerala Government held a Global Investor Meet (GIM) which expected massive investments of about Rs 56,000 crore. In 2005, then President A P J Abdul Kalam addressed the Kerala Assembly and presented a ‘Tenpoint Mission Mantra’ to make the state prosper and fall in line with ‘India Vision 2020’.

“We all know that nothing worthwhile has happened since all these,” says Mr Sethumadhavan and asks in desperation, “What ails Kerala?” “We spend most of our time in talking, with hardly any action. We are past

7 masters in creating controversies and getting into endless debates,” he says.

“Therefore, I feel that, primarily, it is the positive mental infrastructure (PMI) and total quality management (TQM) which are to be considered for the success of infrastructural development in our state.”

Dr V K Vijayakumar, Investment Strategist, Geojit BNP Paribas Financial Services, says there are a lot of basic differences between Gujaratis and Malayalees. People from Gujarat have seen wars, natural calamities like droughts and earthquakes and also epidemics. Keralites by birth lead a cosy life and like to be always in the comfort zone. Though Malayalees are working all around the world a majority of them seek white-collar jobs whereas Gujaratis with a positive mind rarely look for jobs and enter business and run huge industries all over the globe.

Gujarat has plenty of barren land and salt fields which can easily be converted into industrial centres. Kerala, though considered an agrarian economy, agriculture here is in the doldrums because of urbanization.

Keralites waste their productive time by going after scandals and they always look for easy money. It is amusing to see highly qualified people here falling easy prey to people running fake investment schemes.

The ‘alternate’ rulers of Kerala, the UDF and the LDF, both have a socialistic bent of mind and thinking, where there is no room for business and industry. Apollo Tyres recently set up a massive unit in Vadodara (Baroda) in Gujarat. It had started two or three giant units in Kerala initially, but for expansion it finds Gujarat to be the best destination. The owners of the company blame Kerala’s bureaucracy for creating bottlenecks in the way of industry and for slow decision- making .The company is slowly winding up its production in the state.

Mr Kouchouseph Chittilappilly, the legendary entrepreneur and founder of the V-Guard Group, feels that one of the main impediments to swift industrialization of the state is its geographical position itself. Kerala is lying in the extreme south of the country and it is time-consuming and expensive for raw materials to reach and finished goods to go from here.

“Strikes and trade unions are not the only reason for the slow industrial development in the state. There were few success stories or role models to copy or motivate the people in earlier days,” he says. If the Government is not for running industries and business ventures, it should create a conducive atmosphere and infrastructure for smooth industrialization suited to the state. Even if we have any successful industries today, they have come up not due to the Government’s efforts, he says.

Gujarat, without the benefit of natural resources, fertile farmland, hightech hubs and skilled manpower, has been able to transform itself by diligent planning, says Mr Sethumadhavan, who has spent many years in that state. In spite of only 1,000mm of rain and few rivers, agricultural production

perhaps the country’s largest consumer market, with the incomes of its people rising rapidly. Inflation is high, but rising wages and salaries ease the bite.

Even the staunchest sceptics are beginning to be convinced—the opportunity-rich Kerala economy may soon be headed for long-term, predictable growth. The evidence is building— slowly—that the Government’s efforts are indeed working and will not be consumed in further problems or extinguished in political turmoil.

“We spend most of our time in talking, with hardly any action. We are past masters in creating controversies and getting into endless debates. Therefore, I feel that, primarily, it is the positive mental infrastructure (PMI) and total quality management (TQM) which are to be considered for the success of infrastructural development in our state.” there is increasing year after year. Electricity is produced with cheap fuels like LNG and clean sources like nuclear, wind and solar energy. “As an independent quality professional, I have found that Gujarat has encompassed all the elements of TQM, the elements of which are leadership with vision and commitment (leaders should be role models. In Gujarat, they have a democratically elected leader, Modi, who is acting like a CEO); vision, strategy, missions, goals, targets, activities and individual roles. Based on its SWOT (strength, weakness, opportunities and threats) analysis, Gujarat is on a clearcut development path. It has been able to invite massive investments through the vibrant ‘Gujarat Sessions’ ably con-

An advantage for the state is that it has a Chief Minister who has pledged to take the state forward in economic activities. In fact he finds himself at the heart of a battle for the state’s future.

“We want to see change now, instead of years,” the man in a hurry says. He has proposed several medicines, one of which is the forthcoming ‘Emerging Kerala’, a business summit which will be a platform for business leaders and policymakers for detailed two-way discussions and bilateral business.

ducted in 2003, 2005, 2007, 2009 and 2011, says Mr Sethumadhavan.

However news from those in power and several other quarters as also views of many informs the world that Kerala is no longer the risk-fearing, conservative, tradition-bound society it once was. It no longer appears to be the impenetrable fortress it used to be.

Just a few years ago Kerala’s investment potential was nil. Today, however, investor attitudes have changed. The Government itself ends up meeting industrialists and industry organizations.

Special road shows are arranged and investment meetings are held. There is a feeling gradually getting round that investors won’t lose money in Kerala.

Then there is also the growth. Kerala is

L N Sethumadhavan

Belatedly, but thankfully, the state has recognized that the only way to get the state on the path of progress is to make quick and direct massive infusions of new equity into the economy, as well as to commit to other urgent measures hitherto not undertaken.

Kerala’s plus… and minus points According to Mr L N Sethumadhavan, who retired as Deputy General Manager, Larsen &Toubro LimitedHazira Works, Surat (Gujarat), Kerala has several advantages. It also has disadvantages.

The advantages are good rain, lavish sunshine, lovely natural landscape, picturesque panorama …all gifts of God. Besides the state’s high literacy rate and other positive human development indices, high-tech hospitals and healthcare services, good tourism potential, extremely fertile land, huge NRI remittances, high marine export potential, competitive IT and communication potential etc make it a land of infinite opportunities. Kerala is an energy goldmine with hydro, solar, wind, wave and thorium-based power generation possibilities.

Mr M C Paul, Chairman and Managing Director of Irinjalakuda-based Kerala Solvent Extractions Ltd, now KSE Ltd, says Kerala is endowed with abundant natural resources and a high literacy rate. And nature is very kind to the state. But Gujarat is often rattled by earthquakes and communal riots. So Kerala has great potential for the tourism industry. He points out the case of Varkala. Varkala, he says, is being developed as a tourist spot and is attracting more attention than the much-hyped Kovalam beach.

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April 30-May 31, 2012

Disadvantages: Highly politicized environment, negative attitude, aggressive nature, intolerance, poor listening, arrogance, poor team spirit, false and misplaced ego, indiscipline, impatience, unemployment, poor public sense, aversion to blue-collar work (inside Kerala only), high resistance to change, poor humility and humbleness, few role models, not investmentfriendly climate, high consumption of liquor, high suicide, heart attack and accident rates, rampant corruption, unhealthy trade union practices, lack of sincerity to maintain public equipment and services, dismal collapse of ethical and spiritual values, hartals, strikes, violence, destruction of public property etc make Kerala a difficult place to make any quality improvements—these, Mr Sethumadhavan says, are the disadvantages.

He says that with high ability and low motivation, Keralites are generally having a cynical approach to every issue. People have a tendency to be part of a problem rather than part of a solution.

In short, high literacy has brought only ‘right consciousness’ and not ‘duty consciousness’ among our citizens. Therefore, most of the younger generation has to migrate to other states and countries in search of worthwhile jobs.

8 If sensible policies are introduced— and they will have to be—the near-crisis situation on the state’s economic situation will quickly pass. Shellshocked businesses and consumers won’t recover rapidly from the trauma of recent years, especially as we now cope with inflation and recession. But the situation should not be prolonged.

Gujarat or some other model—what the state needs is pragmatic policies that will deliver goods.

Despite its drawbacks, Kerala retains enormous strengths.

Says Mr Navas Meeran, Chairman and Director of Eastern Condiments and Director of Kerala State Industrial Development Corporation: “Kerala has its strengths. It should not be compared with Gujarat or with any other Indian state. It is good for certain things and Gujarat for certain others. The ‘Kerala Model’ of development is entirely different from that of Gujarat. A lush green landscape with water resources and good monsoon make Kerala an admirable state for living. Our 1.3 crore literate population is yet another advantage.

The Malayalee diaspora all over the world is the real strength of the state.

Over a million nurses working all over the world are its brand ambassadors.

To make Kerala a hub of higher education by bringing world-class universities and giving thrust to health tourism is the need of the hour. Taking advantage of our climate we can host international and national conventions and seminars for which we should build good hotels and convention centres. We should have long-term planning for infrastructural development in these areas.”

The world today is flush with cash.

It is frozen because of fear but the cash is there. Productivity gains are burgeoning. The question is whether the rulers will be able to clear the fear of people with cash. They should.

Whether that happens, however, depends on the highly important phase: the political will. If the rulers pursue policies that hinder growth and retard or abort a full-blown recovery, eg regulations that stifle innovation and taxes and levies that harm the creation and deployment of capital, we will be in for chaos again. If the Government can improve things on certain fronts, why not on the battered economy front?

Why not on the industrial front?

For example, the Government has been able to stem labour militancy to a great extent (though the credit is not entirely due to it). There have been few industrial strikes of late. Some are advocating using Government powers to pursue agendas such as forcing better labour and environmental standards, better representation for labour, consumers and investors on boards, steps to prevent business failures, easing of rules and regulations and faster clearing of projects to avoid delay.

Now that we are finally effectively dealing with what steps we should take to bring about economic advancement, what should be done going forward?

First there should be a focused mission. Those in charge of things should be made accountable. But no agency should have enormous power over the economy. Cutting levies and tax rates

is a necessity. Political parties and governments find it hard to understand that taxes and levies don’t just raise revenue, they are also a price and a burden. For example, the tax on profits is the price you pay for success. If you make it more worthwhile for people to take risks, they will do so. Ideally, we should enact a simple flat tax. This has been adopted successfully in several countries.

According to the latest statistics, the economy seems to show some resurgence and there are whiffs of change. It is growing at a higher rate than recorded by other states in the country. In fact growth has been slowing elsewhere in the country. The robust Kerala market is therefore starting to look like a tempting target.

But for those tempted, there is a warning: the state can be treacherous as it is tantalizing.

Companies hoping to crack its markets should not forget harsh lessons learned in earlier times by some. Things here are not necessarily what they seem. Proof is there for everyone to see: investment in the state remains abysmally low.

Mr M C Paul, Chairman and Managing Director of Irinjalakuda-based KSE Ltd, says land acquisition is a tough task in Kerala because of the density of population. Even if a project is launched there arise a lot of political and environmental issues that impede its progress. Even the completion of a

industry or business. Himself a great visionary with innovative ideas and varied business and industrial experience spanning more than six decades, setting up the very first solvent extraction plant in Kerala and bringing out, besides cattlefeed, coconut oil, milk, ghee, curd, butter milk, ice cream, restaurant, park, roads etc in the state and in Tamil Nadu, Paul says Gujarat is a vast state with a lower literacy rate than Kerala and is under almost oneparty rule where the rules are often proemployer. Hence decisions once taken can be implemented forthwith. The solid example is Tata’s Nano car project which was shifted from the Left-ruled Bengal to Gujarat with a nod from Narendra Modi.

This can be easily done in a oneparty-ruled state.

But coalition partners in some other states and at the Centre often throw a spanner in the works of many governments making it very difficult for a consensus to be Navas Meeran reached on a project or an initiative. Hence a public/private enterprise often lies at the mercy of the rules framed by the ruling coalition. This is particularly so in Kerala.

A sector for growth in Kerala is information technology (IT) in tune with its literacy rate. The youth are more interested in IT education and are computer-savvy. Thousands of youth come out as engineers from various campuses all over India as IT exponents.

The world today is flush with cash. It is frozen because of fear but the cash is there. Productivity gains are burgeoning. The question is whether the rulers will be able to clear the fear of people with cash. They sahould. Whether that happens, however, depends on the highly important phase: the political will. If the rulers pursue policies that hinder growth and retard or abort a full-blown recovery, eg regulations that stifle innovation and taxes and levies that harm the creation and deployment of capital, we will be in for chaos again. If the Government can improve things on certain fronts, why not on the battered economy front? Why not on the industrial front? bridge is hampered for want of an approach road and proper land devoid of ecological and political issues. It is clear that only a positive and creative political mindset can bring about revolutionary changes in the industrial spectrum.

Mr Paul emphasizes that it is the honesty, integrity and work efficiency of both employee and employer, quantity and quality of products, consultation with unions and dealers and meeting their needs determine the growth and success of an

But a majority of these young opt for white-collar jobs. In Gujarat, however, people are more business-minded.

Mr Paul also says that medical tourism has high scope for Kerala as the cost of treatment here is very low compared with other states in India and even Western countries.

There are droves of foreigners visiting the state’s medical centres of various systems.

M C Paul PASSLINE

April 30-May 31, 2012

Kerala, says Mr Paul, today depends on goods and services of other states which

suffer from more power cuts than here.

“We cannot maintain the same quality and quantity of products as we get from other states. Malayalees are always for making a fast buck and long for white-collar jobs. The craze for money erodes the sanctity of our culture and tradition and our youth willy-nilly turn drug peddlers, addicts and anti-social elements. It is an irony that Malayalees are always lethargic in their own homeland but hardworking in alien lands.”

Mr Sethumadhavan says we should have a ‘Vision Mantra’ which will inspire all. It could be like ‘God’s Own Country—Passionately Preserved by People’. In Gujarat, it is ‘Vibrant Gujarat’.

According to him, Kerala’s thrust areas are health, science, pilgrimagebased tourism, smart waterways, IT development and marketing, ayurveda, medicinal plants, training of nurses and paramedical staff; deep-sea fishing and related businesses, planning urban facilities in rural areas, value-added products from tea, coffee, spices, coconut, fruits, cashew etc, coir-related valueadded products, dairy and cattle and poultry farming and general services like old-age homes, childcare centres etc.

Each of the thrust areas has to be divided into processes and activities by an independent professional council. This council should be entrusted with the responsibility of forming implementation teams, monitoring progress and timely completion.

“Kerala has to go a long way. But let us at least begin,” he says. “Let our Ministers and those concerned move away from most of the unproductive meetings, false promises, hollow speeches, pointless discussions, mockery of repeated inaugurations, foundation stone laying, worthless debates and controversies, delaying tactics, blame game, publicity gimmicks etc. Let us think big and act.”

No one says that there are no true opportunities for successful investment in Kerala, only that investors must learn to distinguish real transformation from wishful thinking. Remember that Kerala, for all its superficial changes, is still run by the bureaucrats of the powerful economic ministries. Many of these bureaucrats, while professing to be ‘international’ in their thinking and outlook, cling to notions that ‘excess competition’ is an inherent evil that must be controlled.

Politically, the UDF, despite its disgrace in some fields, still wields substantial support among large sections of people and is likely to hold its ground and attract investors. But where and in which fields are the new opportunities for them? What is becoming increasingly apparent is that these opportunities are not to be found but forged. A visitor who returned to the state recently after decades of absence discovered that the most meaningful change was in the accomplishments of some talented Keralites. They, he says, perform complicated balancing acts, as they aggressively pioneer new ways of doing things.

Yes, such pioneers are what Kerala needs.

EDUCATION

9

How lucrative are Engg and MBA? Celebrated for 100% literacy in the country, Kerala has made huge investments in the self-financing education sector. Until a decade ago, a majority of students from the state had to depend on neighbouring Tamil Nadu and Karnataka for higher education.

But with the Kerala Government easing the norms for opening higher educational institutes, institutes started appearing here.

D

oes the country have the resources to accommodate the lakhs of young techies being churned out every year by the various institutes in the country? What will be the future of management students while the world and the country remain burdened with the impact of the economic slowdown? How lucrative are Engineering and MBA degrees in this crisis-ridden world?

By Ziad Siddique institutes started appearing here. This, to some extent, blocked the migration of students to other states.

Even though the number of higher education institutions has risen, the quality of education has not seen much improvement. Experts say the state does not have a quality research centre either in the pri-

These are questions that have been posed by academics and experts for some time. Parents have started having second thoughts on whether their children should opt for either of the two degrees, once considered prestigious in society, as they are no longer found rewarding or profitable after spending huge amounts. Reports show engineering and management graduates are forced to opt for clerical jobs while highly meritorious graduates in other disciplines from premier institutes are being taken over by global and domestic industrial giants. The prestigious degrees that until a few years ago were a sure passport to high-profile jobs with fabulous remuneration packages no longer remain the same, reveal facts and figures. India is one of the major educational hubs in the world with more than 390 universities, including 30 Central universities, out of which 14 are world-class.

Celebrated for 100% literacy in the country, Kerala has made huge investments in the self-financing education sector. Until a decade ago, a majority of students from the state had to depend on neighbouring Tamil Nadu and Karnataka for higher education. But with the Kerala Government easing the norms for opening higher educational institutes,

offer their students.

Higher secondary schools in Kerala number more than 1,000 and produce lakhs of students eligible to pursue higher education. About 30% of them choose arts and the remaining opt for medical, engineering and MBA. There are more than 200 engineering and business colleges in the state, a substantial number of them under private management. The gap between the number of institutes in the state and students passing out of higher secondary schools and seeking higher education is, however, so wide that it may remain unbridgeable for a long time to come.

If it does, quality education will remain an unsolved issue. To improve the situation, educationists have been demanding the starting of more undergraduate institutes so that aspirants can access the courses they wish to study. It may seem ironic in these circumstances that the country is facing closure of some business and technical institutes for want of students.

K N Panikkar

vate or Government sector. This has affected the entire segment though reputed institutes have remained unaffected. They have been bringing out brilliance over the years. It is from among them that the country’s top companies seek brilliant young men, while institutes with poor infrastructure have little to PASSLINE

April 30-May 31, 2012

What might have driven to this situation? Is it because of the fall in the number of eligible students?

Central- and state-run institutions have blamed this on mushrooming institutions with poor quality in the private sector. But they also admit that the entrance examination—a gateway to these prestigious institutes—is comparatively tough. Hence the number of eligible students falls short of the number of actual yearly intake. Only those who have good financial backup can afford the high tuition fees for preparing for these entrance examinations,

10 of critical thinking, inability to apply theoretical concepts to solve problems, inability to function as a team,” says Kris.

Those who take graduation from less known intuitions are not competent to meet industry demands or, in other words, not industry-ready. After recruiting those graduates, industries have to give them training. Having been trained in an industry, they may often leave the company for lucrative jobs.

This trend has also impacted both MBA and engineering disciplines.

G P C Nayar

while the poor are likely to be wiped out in the waves.

“There has been a notion among students as well as parents seeking employment potential prorgrammes for the last ten years. It is not limited to the state alone but is prevalent in the whole country. The lucre-seeking trend abetted the mushrooming of poor-quality engineering and management institutes in the self-financing sector. For this reason, those who are passing out from these institutes are not employable and they are also compelled to choose clerical work on meagre remunerations. Driven by this adverse trend, parents begin to think that investing in engineering and MBA will no longer be worthwhile. Ten years ago there was a boom in MBA and engineering, as there were plenty of opportunities and there was little competition. As years passed competition went up and quality of graduates went down due to the emergence of poor institutions,” says K N Panikkar, former Chairman of the Kerala State Higher Educational Council.

Quoting a NASSCOM-McKinsey survey that came out a few years ago, Kris Gopalakrishnan, Co-founder of Infosys Technologies, says that only 25% of India’s engineering graduates are employable in the IT industry. “In India, the focus of a majority of the academic institutions has been on ramping up technical skills; however, the need of the hour is to address certain broad-based skills that go beyond textbook learning. We must focus on increasing the quality of the workforce as we increase the quantity of graduates. The skill gap between industry and academia is a universal issue.

Based on our past experience, we see that this gap lies in three areas—lack

“At Infosys, we invest heavily in training and educating our workforce.

Fresh recruits at Infosys are put through a 23-week residential programme which includes a lot of hands-on work to help graduates bridge any existing skill gaps. Additionally, Infosys provides new recruits with soft skill training and projects aimed at developing teamwork. We believe that new graduates will be able to meet market demands through comprehensive training programmes with a focus on eliminating skill gaps,” adds Kris.

According to G P C Nayar, Chairman, SCMS Group and National President of the Federation of Associations of Private Unaided Professional Col-

The reason for the waning sheen of the coveted degrees is not only due to the increase in the number of colleges but also to the global economic unrest.

Students who join these streams expecting high remunerations leave the institutions and are forced to accept poorly paid jobs. Industries across the globe have been axing their employee strength ever since the crisis hit the economy in order to survive in the market. T A Vijayan, Executive Director of Sree Narayana Gurukulam College of Engineering, says, “The slowdown in the US has not much affected the IT sector, so the number of students joining BTech (IT) has not declined. Nearly 80% of engineering students, in spite

Kris Gopalakrishnan

engineering stream. More than one lakh students appeared in the engineering entrance examination this year. It is expected that more than 60,000 will come out as eligible. There are however only 46,000 seats in the state.

Those aspiring to pursue engineering have left to seek admission in less reputed institutions. Besides, a section of them would like to leave the state, where they could develop their language skills as well. It is not a matter of these disciplines losing their sheen but the quality of output,” says G P C Nayar.

T A Vijayan

“In India, the focus of a majority of the academic institutions has been on ramping up technical skills; however, the need of the hour is to address certain broad-based skills that go beyond textbook learning. We must focus on increasing the quality of the workforce as we increase the quantity of graduates. The skill gap between industry and academia is a universal issue." leges, the demand for MBA has declined to some extent as companies have started to recruit regular graduates from campus. “The reason for recruiting regular-stream graduates in place of MBAs is that they feel these graduates will be consistent while MBAs will hop after a short period of training. Besides, the quality of the professional degrees has been affected because of the rise in the number of institutes in the state”.

P V Mathew

number of those passing out is small.

In order to make every aspirant industry-ready, institutes should provide soft skills along with regular curricula.

Moreover, for placements, rural areas have fewer facilities compared with cities. Placements in rural areas need to be strengthened to maintain the balance. At the end of the day, it’s survival of the fittest. The best colleges will continue to exist while the others will decline,” says P V Mathew, Chairman of Federal Institute of Science and Technology (FISAT).

“It is a fact that those who pass out as engineers are not placed well. It is not because they are incapable; rather most companies demand above 70% marks in 10th, Plus 2 and BTech. Besides, compared with the intake, the PASSLINE

of their streams, except civil engineers, want to pursue IT jobs. Highly talented students seek their fortune out of the state. Remaining graduates are compelled to pursue low-profile jobs in the state. The intake in the engineering streams has been declining due to the above-mentioned factors for the last three years. When the number of management institutions has increased, the quality of graduates has gone down. You cannot say the demand has declined. There are vacancies but only for brilliant students,” says Vijayan.

“Today, companies seek not just an MBA but an MBA from a reputed institution. Similar is the case with the April 30-May 31, 2012

How can this situation be changed?

What are the possibilities of change?

“There are reports that the Government has freely allowed institutes with low standards to function. Education has multiple dimensions and every aspirant should get knowledge. There should be certain parameters while allowing professional institutions to function. Universities to which these institutions are affiliated should introduce measures to improve ther quality. Apart from that the Government has to institute scholarships for those opting for arts subjects. It is not only a regional phenomenon. Only concrete steps can solve this problem,” says Panikkar.

The huge increase in the number of institutions is also one of the reasons for the decline in the quality of engineering graduates, says Mathew.

“The Government should bring in legislation to prevent the emergence of institutions with low standards. Talukwise allotment of new institutions can thwart the mushrooming of colleges.

The Government must ensure the quality of the facilities provided as well as the faculty employed, and admissions must be strictly on merit to get better results,” says Mathew.

CREDIT POLICY

11

Impact of repo rate reduction on home loan Passline News Service

A

home is the dream of every human being and banks are trusted institutions where they rush to for loans to fulfil their dream. No matter whether rates are high or low, people want loans and, of course, better services as well.

The Reserve Bank of India’s announcement of reduction in the repo rate (overnight interest rate that commercial banks pay to the RBI for borrowing money) by full 50 basis points (0.5%) was a surprise. Naturally most existing home loan consumers think that this will automatically mean lower equated monthly instalments (EMIs) for them. But banks have the option to charge the revised repo rate for existing loans as well as not to charge it on them. Though the credit policy can mean lower EMIs for existing home loan consumers, it may not be in the way that they think. Contrary to popular conceptions, a decrease in repo rates does not automatically translate into decrease in loan rates though consumers can be forgiven for forming this erroneous opinion because in the past three years the interest rates have mostly gone up in line with increases in repo rates.

The RBI has increased the repo rates 13 times in the last three years on basis points. A basis point is one-hundredth of a percentage point. People who had taken home loans and car loans are likely to be impacted much. The reason is that commercial banks like IndusInd, HDFC and ICICI will have to pay more if they want to borrow from the RBI. But individual borrowers as well as corporations may not feel the impact of the rate increase immediately as banks are not in a hurry to raise their loan and deposit rates.

announce some token interest rate cuts on home loans but they are likely to come from decreasing spreads over the base rates rather than a drop in base rates themselves. It means that only new home loan consumers are likely to benefit rather than the existing ones. existing and new home loan borrowings will decrease with the repo rate reduction by an unexpected 50 basis points. (The general expectation was a 25 basis point cut). The reduction in repo rates will have little impact on home loans. We may expect banks to

The RBI has increased the repo rates 13 times in the last three years on basis points.

A basis point is one-hundredth of a percentage point.

People who had taken home loans and car loans are likely to be impacted much. The reason is that commercial banks like IndusInd, HDFC and ICICI will have to pay more if they want to borrow from the RBI. But individual borrowers as well as corporations may not feel the impact of the rate increase immediately as banks are not in a hurry to raise their loan and deposit rates.

There is however another provision in the policy that is likely to benefit existing home loan consumers if they are willing to be a little proactive. After waiting for the banks to adopt the policy voluntarily, the RBI has, at last, decided to issue mandatory guidelines abolishing pre-payment charges on all floating rate home loans. Most existing floating rate customers are paying anywhere between 11.5% to 15% interest on their home loans versus the 10.5% to 10.75% being charged on new consumers by the same lenders.

The other fallout of the credit policy is that the deposit rates are likely to be reduced by banks. The scope of cutting deposit rates is rather limited given the lower-than-expected growth rates in bank deposits and the fact that the interest rates on small savings instruments such as time and recurring deposits from post offices as well as NSC and senior citizen saving schemes and PPF have been fixed at a fairly high rate for this financial year.

Over 95% of home loans are floating interest rate loans. The RBI-appointed banking ombudsman has been receiving a number of complaints from borrowers on the mounting credit risks as a result of increasing interest rates. Home loans today are 2%-3% fixed rate ones. Even though interest risk is managed by banks, the risk is ultimately forced on the consumer in a rising interest rate scenario. Floating rate loans pass on the interest rate risk from banks which are much better placed to manage it to borrowers and thus banks only replace interest rate risk with potential credit risk. If a decision on this comes through it will be for both own source funds and borrowed source funds of banks.

The RBI was forced to increase lending rates/repo rates because of the continuing increase in inflation. Commercial banks and other money lenders will increase their rates of interest consequently on a variety of loans. At the end of the day it is the long-tenure housing loan takers who will be affected. But due to the inconsistent and soaring rates of interest the fixed income people will be the most affected.

The indirect decrease in their monthly income will result in their standard of living declining. Taking effective measures to control the inflation and their success may result in decreased interest rates in future.

Over the last three years, the RBI has raised the cash reserve ratio (CRR) by over 100 basis points and the policy rate by over 275 basis points. This in effect means that banks have to face a net effect pressure of around 425 basis points. For example, if a person took a home loan of Rs 20 lakh in EMI from any commercial bank in May 2011, he has to pay 10.25% interest. If the RBI continues to increase the repo rates by 13 times in the next 18 months it will highly impact this person. Similar is the case with a person who bought a car for Rs 5.2 lakh a month ago. So obviously borrowers have a legitimate expectation that interest rates on their PASSLINE

April 30-May 31, 2012

MOTIVATION

12

Persistency can drive you to your goal Passline News Service

Bikhchandani’s success story is as simple as he himself.

He had struggled to be firm against all odds in his drive to the successful path. Today, Naukri.com is an imperative tool for those who hunt for jobs on the internet.

“Success will come when we try to find an alternative to solve a problem,” says Bikhchandani.

H

ave you ever tried to recognize the entrepreneurial skill in you? Most people don’t go deep in. But there are some who pursue their goal surmounting all obstacles. A large part of the success of every project lies in persistence, great teamwork, capacity to resolve the unsolved and innovative ideas, says Sanjeev Bikhchandani, founder and Vice-Chairman of Naukri.com, India’s first listed online company. “Only persistency can drive someone to his goal. Of course there will be bottlenecks but an entrepreneur should maintain a brave heart to meet them,” says Bikhchandani.

Bikhchandani’s success story is as simple as he himself. He had struggled to be firm against all odds in his drive to the successful path. Today, Naukri.com is an imperative tool for those who hunt for jobs on the internet. “Success will come when we try to find an alternative to solve a problem,” says Bikhchandani. The idea to launch a job data base occurred to him in 1990 when he was working at HMM Hindustan Milkfood Manufacturers, later taken over by Glaxo). He wondered at people who were swallowing Business India from back to front for job vacancies. After quitting HMM five years later, he started sorting out job vacancies in a certain format easy to choose by aspirants, realizing that jobs are high-interest category.

Bikhchandani reckons that there will be no success without a qualified and dedicated workforce.

“I was only an instrument, the workforce of Naukri.com is the real tool,” says the humble Bikhchandani. Like many successful entrepreneurs, Bikhchandani is full of ideas and energy. Even today, years after the launching of Naukri.com, Bikhchandani talks about it with enthusiasm, compelling one to think that he is as passionate about it as he probably was years ago.

And all this hasn’t come easy. Ups and downs— he has seen them all. And he has survived them all and is doing well. He quit his job, went without salary for close to three years, working out from servants’ quarters, and was virtually living on his wife Surabhi Bikhchandani’s salary support, survived the dotcom bust, and so on. He started his own company, Info Edge. “The seven years from 1990 till I launched Naukri weren’t easy-going for me. Some were good years; some were bad,” recalls Bikhchandani. The company primarily did salary surveys and reports, database management work

and consultancy.”In 1992 the Department of Telecom came out with an advertisement which invited private information providers for Videotex, a service where people would pay for accessing information stored on a central server. Naukri was short-listed but unfortunately the project was shelved, and so was the idea,” says Bikhchandani.

It took four years for him to be in contact with the internet after his first approach to the Telecom Department, and it was at the IT Asia Exhibition held at Pragati Maidan in Delhi in 1996. He realized that the process of the internet was the best for his project. His brother helped him to acquire a

The site was launched in April 1997. “In the initial year we made just Rs 2.5 lakh. Soon the dotcom frenzy caught up with people.

However, the company incurred losses for almost two years. In 1999, it went for venture capital and in 2006 it went ahead with an IPO too, which made Info Edge and Naukri the first Indian website to list on an Indian stock exchange.”

Bikhchandani reiterates that “the credit for the success of Naukri should largely go to a lot of other people who worked for us. Some of them have made more contributions than I have.”

US server paying Rs 25,000. His software engineer friend designed software according to his requirement. The rest, as they say, is history.

The site was launched in April 1997. “In the initial year we made just Rs 2.5 lakh. Soon the PASSLINE

April 30-May 31, 2012

dotcom frenzy caught up with people. However, the company incurred losses for almost two years. In 1999, it went for venture capital and in 2006 it went ahead with an IPO too, which made Info Edge and Naukri the first Indian website to list on an Indian stock exchange.” Bikhchandani reiterates that “the credit for the success of Naukri should largely go to a lot of other people who worked for us. Some of them have made more contributions than I have.”

Bikhchandani was bestowed the Pathbreaker Award in 2008 in recognition of his ability to create, retain and maintain a great team apart from creating a global brand in the internet world.

Another interesting point which clearly went in Bikhchandani’s favour was the fact that he has not only created wealth, but has also shared it. He won the Ernst and Young Entrepreneur of the Year Award in 2008 for Business Transformation. He also won the Dataquest Pathbreaker Award and the Teacher’s Achievement Award for Business in the same year.

In 2011 he received the Distinguished Alumnus Award by IIM-Ahmedabad. He is also the President of the Delhi chapter of TiE (The Indus Entrepreneurs] and also a member of the Board of Trustees of TiE Global.

An MBA from IIM-Ahmedabad, Bikhchandani had worked in advertising with Lintas and in consumer marketing with Glaxo SmithKline for short periods. He quit these lucrative jobs for entrepreneurship. Info Edge Pvt Ltd, the parent company of Naukri.com, was founded on May 1, 1995 which for more than a decade grew as India’s premier online classified company. Info Edge has today the following highly successful subsidiaries: www.naukri.com and www.naukrigulf.com focusing on online recruitment in India and the Gulf region, respectively. The company also runs web portals for matrimony, real estate, education etc. It also undertakes investments in early-stage markets/ start-up ventures like Policybazaar.com, Meritnation.com, Zomato.com, Mydala.com, 99labels.com etc.

Naukri.com, the flagship company of the group, currently maintains a network of 48 offices in 31 cities throughout India and also has offices in Dubai, Bahrain, Riyadh and Abu Dhabi. The company went public in 2006 and today employs more than 2,100 people with a market capitalization of above Rs 3,000 crore.

CINEMA

13

‘Courage for experiment’ is the motto of the new-gen films in Malayalam. Bold statements and so-called ‘taboo’ subjects have become the hot topics for directors and producers.

Years ago, Malayalam films were known for their family-centric topics and heart-rending music.

But now infidelity, impotence and black humour have become the central points.

Yes, the U-turn makes films more real and sensuous.

Interestingly, the new-gen audience also shows interest in these movies.

T

he Malayalam film industry, which had been in the midst of a crisis following mounting production costs, continuing fights between industry organizations, failure of films at the box office and bickering among different players, is witnessing a new dawn thanks to the emergence of a group of ‘new blood’ who have been successful in turning out innovative products marking an improvement in standards.

‘Courage for experiment’ is the motto of the new-gen films. Bold statements and so-called ‘taboo’ subjects have become the hot topics for directors and producers.

Years ago, Malayalam films were known for their family-centric topics and heart-rending music. But now infidelity, impotence and black humour have become the central points. Yes, the U-turn makes films more real and sensuous. Interestingly, the new-gen audience also shows interest in these movies.”I never like stereotype films. A film should portray reallife characters and situations”, says Neena, a college student.

Kerala Café can be considered the precursor to the era of contemporary movies. The novel venture consisted of a medley of 10 individual short films.

The 14-minute Happy Journey, an exceptional flick, upturned the whole concept of a full-length two- and-a-half-hour film. Through her maiden venture, director Anjali Menon’s Happy Journey showed the insecurity of a lonely girl traveller in a very amusing way. The search for a good script and a talented scriptwriter and performers was becoming relevant.

The success of films like Chappakurishu and Beautiful has also

Spring flowers in Mollywood

By Radhika C Pillai heralded the changing attitude and tastes of the Malayalee audience. Unwanted stunt sequences, overemotional scenes and substandard jokes were the essential ingredients of yesteryear films. And there existed the unwritten rule that a film should be herocentric and it should satiate the appetite of fans’ associations. But more heroine-oriented films are coming now.

Cocktail and Traffic also triggered the changing atmosphere. The speciality of these films was that they didn’t

network. It seems that the people behind the film were aware how a wellspun script could attract audiences.

Fortunately, Mollywood today has talent. Unfortunately, however, acclaimed directors and scriptwriters still get tucked up in the 1980s and mid1990s. They hesitate to explore newer possibilities and trends.”Our directors always want to be in the safe zone and their reluctance to make brave attempts produces clichés”, says Sagar Sathyan, a young short film director.

Anjali Menon

Aashiq Abu

Murali Gopi

PASSLINE

Arun Kumar Aravind

Salt and Pepper by Aashiq Abu could create waves in the film industry. As the name implies, it is a buffet for film lovers. Through this hit, the director shows that film direction is an April 30-May 31, 2012

The other hit in the row is Arun Kumar Aravind’s Ee Adutha Kalathu.

Scriptwriter Murali Gopi, son of the late actor ‘Bharat’ Gopi, who also portrays Ajay Kurian, a character in a state of impotency, frustration and ego clashes through subtle gestures, lives the role. It shows that M o l l y w o o d doesn’t lack talented artistes.

But remakes are turning a curse in Malayalam. Though such films manage to hit the headlines, they make little waves, becoming just reproductions of the hits of legends with some masalas and soft porn added to them.

Nidra, a film by Bharathan remade by his son Siddharth Bharathan, is, however, an exception. The young Siddharth did an honour to his father by recreating the original without losing its soul.

Siddharth Bharathan

The success of films like Chappakurishu and Beautiful has also heralded the changing attitude and tastes of the Malayalee audience. Unwanted stunt sequences, overemotional scenes and substandard jokes were the essential ingredients of yesteryear films.

And there existed the unwritten rule that a film should be hero-centric and it should satiate the appetite of fans’ associations. But more heroine-oriented films are coming now. have any ‘superstars’; they had only actors. Of course these flicks never projected any insignificant characters.

Every character had their own purpose and they were wisely twined in the

art in its own way. His next venture 22 Female Kottayam is the latest addition to his chart-buster list. Aashiq is one who uses new marketing strategies for promoting his films. The success of these films shows the possibilities of online film campaigns and social networking sites.

“Today’s film scripts are more structured and planned”, says C S Jayaram, film critic. This quality will help to sustain the pace of production of good films, he says.

Mollywood is on the path of change.

And all who have the good of Malayalam films at heart welcome the pleasant difference with broad smiles and open hearts. “To improve is to change; to be perfect is to change often”.

STOCK

14 From May and June the bourses are expecting some uptrend and so the coming months give hope for investors, especially when the fourth-quarter results of most of the companies are showing improvement in growth and profit.

Deficits mar stock market revival Passline News Service

I

ndian bourses are not at all regaining their lost glory of 2008 despite the rejuvenation therapies being prescribed by both the Central Government and the Reserve Bank of India from time to time. Thanks to the micro and macro factors prevailing in India in general and globally in particular, the country’s stock markets had nurturing high hopes on Pranab Mukherjee and his budget. But contrary to the expectations, unlike earlier, the market had a deserted look even before the winding up of the budget speech in Parliament because of lack of market grapevine on the budget. After the budget, a slew of policies taken by the Government and certain happenings like downgrading of the Indian economy by international rating agencies created a negative perception in the minds of the investors .

Mr Raghavan V, Regional Head— Kerala of Nirmal Bang Securities Pvt Ltd, says that since there were chances of a good recovery and good trading possibilities in January and February the market had started to consolidate in March and April. From May and June the bourses are expecting some uptrend and so the coming months give hope for investors, especially when the fourth-quarter results of most of the companies are showing improvement in growth and profit.

Moreover, the steps taken by the RBI to reduce interest rates give more liquidity and help to improve fund flow.

The central bank directive to cut interest rates on home loans, vehicle loans and personal loans will bring hope for real estate and automobile companies.

The effect of the RBI directive on home loans can be seen in the real estate sector in due course. But the automobile sector showed its impact in the market immediately with the launch of new vehicles and the sale of vehicles spurted.

The General Anti Avoidance Rule (GAAR) issue is expected to be solved during the current Parliament session and this will help to improve more for-

eign institutional nvestors’ (FIIs’) inflow into the market.(GAAR is related to the tax evasion of FIIs in foreign countries).

The global economy worries due to the Euro debt problem have almost been solved. Enough funds are being pumped by the Euro Central Bank. So the market is expecting no major crisis.

The prices of all industrial commodities except crude oil are now down.

The price of crude oil is also expected to come down because of oversupply from Russia, Libya, Syria etc as a result of enough stocks in major countries and lower demand from the US, Euro countries, China etc.

Inflation is now under control. The weather forecasting department projects a state of normal monsoon which will give a boost to the economy and the share market this year. Indian stocks are now on attractive valuation;

buy on a dip. Always investing in lower rates in bad times gives more returns.

Stocks like Tata Motors, M&M, Fag Bearing, Hi-tech Gears, Yes Bank, HDFC Bank, DCB, IndusInd Bank, HDFC, ICICI Bank, Hindalco, L&T, Rallis, V-Guard, Sun Pharma, Dr Reddy’s etc are good for investment.

The resolute GAAR issue is likely to bring more investment to the market.

Mr Ignatius Kulirani, Regional Head-Kerala of Karvy Stock Brokering Ltd, does not see a major setback for the Indian stock market, though he depicts a picture of slowdown of the Indian economy. He laments that the recent rating agency’s low rating of the economy is the stark example of that.

He asserts that India depends more on imports than exports. And whatever items we import are supplied at a subsidized rate so that overall India’s eco-

The steps taken by the RBI to reduce interest rates give more liquidity and help to improve fund flow.

The central bank directive to cut interest rates on home loans, vehicle loans and personal loans will bring hope for real estate and automobile companies.

The effect of the RBI directive on home loans can be seen in the real estate sector in due course.

But the automobile sector showed its impact in the market immediately with the launch of new vehicles and the sale of vehicles spurted. most of the shares are below average rates.

It is the Government inertia on policies and decisions that is responsible for the slow pace of growth. Lower consumption rates of the US and the European countries, China’s growth, higher crude oil rates etc are some negative trends in the markets.

But still Nifty may tend to move upwards in the 5,400-5,600-5,800 range in the coming months and Sensex may touch the 18,300-20,300 range.

Sectors like auto, auto ancillary and private banks will perform well in the coming months. Rather than general investment, stock-specific investment is advised for all investors. The general suggestion is that if share prices are up soon, it is advisable to wait and PASSLINE

nomic growth is on a downward path.

India is a major consumer of crude, petrol and diesel which are given to the consumers at subsidized prices which affect the Government exchequer immensely. The budget deficit as well as trade deficit has widened as we depend more on these imports which require abundant foreign exchange. The foreign exchange deficit may create a situation where we have to pledge our gold as done nearly 20 years ago. The foreign exchange deficit reflects in our budget and trade deficit. So foreigners would view the Indian economy as unstable. This is the reason our economy is under-rated by a rating agency recently. This will reflect in the FIIs’ investment in our stock market making our stock index slump.

This would not make its impact individually. But how much would be the April 30-May 31, 2012

quantum of subsidized petrol /diesel that may be used by a corporate entity causing a dent on the Government exchequer? This will have an overall impact on the economy. Ultimately, it is necessary that the Government should adopt some measures to mitigate the deficit gap and the Government should be stable to implement such policies and decisions.

Mr Babu Eapen, who has long years of experience as an investor, has a bright outlook of the market. He asserts that there is a certain period for the investor to have a good return. He quotes the example of a student passing the SSLC after 10 years of study.

Likewise an investor can gain from his share after a certain period depending on the type of share he invests in.

Now the conditions are favourable for the stock market. The reduction in interest rate, the controlling of inflation and the conducive climate are very favourable for an investor. A bank investment fetches 7%-10% interest. At the same time investment in shares gives us 20%-22% returns. The cut in bank interest rates may increase the demand for banking services like home loans, vehicle loans and personal loans. But the overall turnover of the banks may become low.

Mr Eapen points out that there is no sense in naming the Euro crisis, money depreciation, inflation or rating of the economy by the rating agency for the downtrend in the stock market.

Its impact will be for two or three days.

Then the market will be on a revamp mood as the purchasing power of the people increases. Nearly 80% of the companies are faring well in the stock market.

Someone said that the Greece crisis is the reason for the slump in the Indian market. Greece is a small country and the economic crisis there has nothing to do with our stock market, he says.

In his view, inflation, sometimes, brings hope for a manufacturer as his product would fetch a good price.

Mr Eapen says that investing in shares is always good for a good investor with the right perspective of the stock market.

COMMODITIES

15 Higher labour costs, pests, diseases and lower productivity make pepper cultivation unviable even when prices are ruling at historic highs. Much will depend on the ambitious replanting scheme launched by the Spices Board in association with the Agriculture Department that could help pepper production to be restored to above 50,000 tonnes per annum by 2013-14 from the present level of 43,000 tonnes.

A time may come when the domestic market may benchmark its prices to SMX pepper futures as is being done in the case of rubber with TOCOM, Japan.

By Sreekumar Raghavan

P

epper trade is going global with the launch of futures at the Singapore Mercantile Exchange (SMX). Prices hit a historic high of Rs 45,000 a quintal in February and production shortfall is supporting prices, yet the Kerala farmer can gain only through yield improvements.

Higher labour costs, pests, diseases and lower productivity make pepper cultivation unviable even when prices are ruling at historic highs.

Much will depend on the ambitious replanting scheme launched by the Spices Board in association with the Agriculture Department that could help pepper production to be restored to above 50,000 tonnes per annum by 2013-14 from the present level of 43,000 tonnes.

India’s pepper production had fallen dramatically in the last two years initially to 48,000 tonnes and 43,000 tonnes after attaining a peak of 92,000 tonnes in 2005-06 on account of drastic fall in productivity due to aging, senile plantations and pest attacks.

The Spices Board also plans to import the Madagascar variety that can give yields

ity Exchange, say that on the expiry of the April 2012 contract 15 tonnes of black pepper meeting the exchange specifications was delivered on the exchange. The contract saw active participation by trading houses from Europe to Asia, and the successful conclusion of the physical delivery was testimony to the confidence these global agri-commodities players placed on the clearing and settlement platform provided by the exchange and its clearing corporation.

Pepper rally Kerala farmer can gain only on rise in yields above 2,000 tonnes a hectare and successfully tested in Vietnam, the largest producer of black pepper in the world.

Speculation: Speculative activity in pepper futures drove prices up to Rs 45,000 a quintal at the National Commodity and Derivatives Exchange (NCDEX) in February but subsequent interventions by the Forward Markets Commission (FMC) and arrival of Vietnam pepper have dampened the rally. The exchanges had imposed a 5% additional margin to the existing 10% on the long side from April 3, 2012 to curb speculative activity while

margins were reduced by 5% to the short side.

Higher Indian prices and weak export demand led to 5.54% fall in prices for May pepper at NCDEX in the last week of April to Rs 37,200.

Analysts say that a break below Rs 36,900 can accentuate the fall to Rs 36,000 and Rs 35,000 in the medium term.

Global pepper production is expected to rise to 3,20,000 tonnes in 2012 compared to 2,98,000 tonnes in the previous year, according to the International Pepper Community.

There are fewer takers for Indian pepper as it is quoted at a premium of $200 a tonne compared with Vietnam.

“These overseas buyers are shifting to a cheaper destination (Vietnam). Even producing countries such as India, Brazil and Malaysia are stocking cheap pepper from Vietnam. In the long run, lower domestic availability and de-

mand from traditional buyers, which usually arises in August, may support the upside in prices,” she adds.

According to the Spices Board, imports during 20102011 are estimated at around 9,000 tonnes, lower than 16,100 tonnes in 2010-11.

However, exports stood at 22,300 tonnes during April 2011 to January 2012, a rise of 49% compared with 14,950 tonnes in the same period of the previous year. The target set by the Spices Board at 20,000 tonnes has already been achieved. Domestic consumption of pepper stands at around 45,000-48,000 tonnes.

The Singapore Mercantile Exchange has announced the successful completion of its first physical delivery against the world’s first global black pepper futures contract. The exchange promoted by Financial Technologies Ltd, promoters of India’s Multi Commod-

Higher Indian prices and weak export demand led to 5.54% fall in prices for May pepper at NCDEX in the last week of April to Rs 37,200. Analysts say that a break below Rs 36,900 can accentuate the fall to Rs 36,000 and Rs 35,000 in the medium term. Global pepper production is expected to rise to 3,20,000 tonnes in 2012 compared to 2,98,000 tonnes in the previous year, according to the International Pepper Community.

PASSLINE

April 30-May 31, 2012

How rubber will bounce: This is the theme for the World Rubber Summit 2012 to be held at Singapore from May 22-24 organized by the International Rubber Study Group.

It is indeed very relevant to the Kerala farmer who has seen subdued trends in the market for a long time falling to Rs 183 a kg for RSS 4 grade before climbing back to Rs 199 levels and falling again to Rs 195 levels.

The World Rubber Summit is discussing a number of interesting topics including future demand growth for natural rubber and challenges in increasing production—labour shortage, land use and availability and climate change are being discussed apart from commodity futures and rubber and demand scenario from automobile and other industries. Indian participation in the event seems to be restricted to Sheela Thomas, Chairman, Rubber Board, and representatives from Apollo Tyres.

The main goal of the conference is to provide rubber decision-makers and related industry leaders with the knowledge and the connections they need in order to make valid business decisions in terms of the growth and sustainability of the rubber industry over the coming years.

For the Kerala rubber grower, what is more important today is not to get concerned about which way prices will go but on improving the quality of RSS grade. The trend is towards radialization of rubber tyres and that requires more quality NR. The Rubber Board has already launched a campaign to generate awareness on quality but will our farmers rise to the occasion?

(The author is Chief Commodity Strategist at Commodity Online, leading provider of information, analysis and advisories on commodities)

ECONOMY

16

By Dr V K Vijayakumar

What ails the Indian economy?

The situation today is a far cry from what it was during the halcyon years of 2003-08. India’s GDP growth rate has sharply decelerated to 6.9% in 2011-12.

Industrial growth rate has nose-dived to less than 3%.

The twin deficits—fiscal deficit (FD) and current account deficit (CAD)—have reached dangerous levels.

The combined deficit of the Centre and the States has crossed 9% and the CAD at 4% is similar to the situation during the 1991 balance of payments crisis.

Inflation continues to be above the Reserve Bank of India’s comfort zone. With the trade and CADs at very high levels, the rupee is steadily depreciating. Though we are not yet in a crisis, India with its twin deficit problem is vulnerable to capital outflows which might arise from an external shock.

Foreign investors, who have not yet given up on India, are not as enthusiastic as they used to be.

A

few years ago the ‘India growth story’ was a hot topic of discussion among economists, fund managers, think tanks and world leaders. India had recorded an enviable growth rate of 8.6% during 2003-08. Tax buoyancy was robust. The Government was loosening its purse strings for the implementation of ambitious social sector projects like NREGA. The combined deficit of the Centre and the States had declined to 4% of the GDP. Current account deficit was a mere 0.5%. Inflation was under control. Corporate India was in the pink of health. India became a hot destination for capital flows from abroad. Stock markets soared. More importantly, India became one of the few countries that successfully managed the global financial meltdown of 2008 and avoided the Great Recession of 2009. There was a near consensus that India’s emergence as an economic superpower is inevitable.

The situation today is a far cry from what it was during the halcyon years of 2003-08. India’s GDP growth rate has sharply decelerated to 6.9% in 2011-12. Industrial growth rate has nose-dived to less than 3%. The twin deficits—fiscal deficit (FD) and current account deficit (CAD)—have reached dangerous levels. The combined deficit of the Centre and the States has crossed 9% and the CAD at 4% is similar to the situation during the 1991 balance of payments crisis. Inflation continues to be above the Reserve Bank of India’s comfort zone. With the trade and CADs at very high levels, the rupee is steadily depreciating. Though we are not yet in a crisis, India with its twin deficit problem is vulnerable to capital outflows which might arise from an external shock. Foreign investors, who have not yet given up on India, are not as enthusiastic as they used to be.

What caused this sudden trend reversal? Has the India growth story soured? Can we recoup the losses and re-emerge as the rising star of BRICs? What should be done to realize our true potential?

These are the relevant questions.

A combination of factors—both economic and political—caused this sudden trend reversal. Politically India is passing through difficult times. The ruling UPA II has lost most of the credibility that it had in the initial period following the 2009 election results.

Though the Prime Minister’s honesty and integrity are beyond question, he is looked upon as a weak leader lacking political authority. The coalition partners in the UPA ran their ministries as their personal fiefdoms and the country witnessed a series of scams.

Lack of consensus on crucial bills like the land acquisition bill, delays in environmental clearances, pussy footing on DTC and GST…all have combined to create a very negative investment climate. The governance paralysis and the bureaucratic fear caused by the anti-corruption crusade have contrib-

uted in no mean measure to the deterioration in the investment environment.

Investors, who were looking for some respite in the budget, were rudely shocked by the GAAR (General AntiAvoidance Rule) which seeks to impose taxes retroactively.

The weak Congress Party, continuously blackmailed by the belligerent coalition partners like the TMC, couldn’t implement important decisions like the petroleum price increase. Consequently, subsidy shot up to 2.45% of GDP and fiscal deficit ballooned to 5.9% of GDP. These are, clearly, unsustainable levels. Such high levels of fiscal deficit with its inflationary potential forced the RBI to raise interest rates 13 times in a row from March 2010 to October 2011. This tight money policy took its toll on industrial and economic growth.

India can claim that her 7% GDP growth is among the best growth rates in the world and that this is commendable achievement in the current global context characterized by growth scare in the developed world and growth scarcity in most parts of the world. But,

A combination of factors—both economic and political—caused this sudden trend reversal. Politically India is passing through difficult times. The ruling UPA II has lost most of the credibility that it had in the initial period following the 2009 election results. Though the Prime Minister’s honesty and integrity are beyond question, he is looked upon as a weak leader lacking political authority. The coalition partners in the UPA ran their ministries as their personal fiefdoms and the country witnessed a series of scams. Lack of consensus on crucial bills like the land acquisition bill, delays in environmental clearances, pussy footing on DTC and GST…all have combined to create a very negative investment climate. The governance paralysis and the bureaucratic fear caused by the anti-corruption crusade have contributed in no mean measure to the deterioration in the investment environment.

Investors, who were looking for some respite in the budget, were rudely shocked by the GAAR (General Anti-Avoidance Rule) which seeks to impose taxes retroactively.

PASSLINE

April 30-May 31, 2012

this is poor consolation. India needs to grow at around 8% for financial stability. Growth rate of less than 7% will make India vulnerable to financial instability. India is dependent of foreign capital flows for financing her current account deficit. Capital outflows caused by an external shock can weaken the rupee substantially, fuel inflation and wreak havoc with the macro fundamentals of the economy.

There is even a risk of credit rating downgrade under such circumstances.

Such a vicious cycle of unfavourable developments can be highly disruptive and is fraught with dangerous consequences. Therefore, it is high time that India put her house in order.

The RBI has done what it can by cutting interest rates by 50bp. But, with the inflation rate still beyond the RBI’s comfort zone, it would be unrealistic to expect big interest rate cuts going forward. Therefore, the Government has to bite the bullet and take the necessary steps to achieve fiscal consolidation which has become crucial for the Indian economy presently.

Pussy footing on important issues can become a recipe for disaster.

India is not yet in a crisis situation.

The problem is manageable.

Manmohan Singh has the track record of steering the economy from the crisis of 1991 and putting it on the path of sustained high economic growth which the world admired. Will he rise to the occasion? Will the Congress muster the political courage to call the bluff of short-sighted coalition partners?

Can they do some deft political manoeuvring to get the much-needed elbow room for passing some important bills? Can the UPA build bridges to the opposition to pass the GST? Let’s keep our fingers crossed.

(The author is Investment Strategist at Geojit BNP Paribas Financial Services)

17

By Dr N Ajith Kumar

A multidimensional credit policy

C

redit policy pronouncements had in recent times been just rhetoric so much so that the general public looked upon them as mere statements explaining to what extent the interest rates had been revised. Between March 2010 and October 2011 the rates had been revised upwards 13 times and this itself bears testimony to the fact that credit policy is nothing but a tight money policy. So when the Reserve Bank of India came out with a number of policy statements on April 17 it made the students of Commerce and Economics sit up and make a detailed study. Being the first of the kind in the new fiscal it was natural that it would contain a perspective for the year ahead. In addition it was in the aftermath of the national budget and the steps that had to be initiated in the year ahead also required mention. Unlike many other institutions the RBI is both a regulator and an implementer. Though its powers are more on paper than in actual practice, it does have the role of an adviser to the Government. As an official of the RBI humorously pointed out, “the RBI in reality does not give any advice and even if we give they don’t take it.” Humour apart, one has to commend the apex bank for having made references to some key issues which give this policy statement of April 17 a different look as well as a different dimension.

6.70% and this could not be achieved.

In this context even the most optimistic among the monetarists would never have expected the RBI to bring down the repo rates by 0.5%. The logic is understandable. Reducing the CRR to 4.75% had eased the liquidity crunch a great deal. Over the last two months when CRR was progressively reduced by 1.25%, the banks had with them an additional Rs 65,000 crore to meet credit requirements. But the high interest rates discouraged borrowing and the fall in the Index of Industrial Production in the last quarter was really flabbergasting. The RBI seemed to have at last realized the necessity that a cut in interest rates was the need of the hour to rejuvenate the industrial sector with credit at more reasonable interest rates. The RBI has also announced that in the year ahead these rates will be readjusted to a maximum extent of 0.5% and this also gives some stability to the credit policy.

The credit policy has come with great relief to all those who are proposing to take housing loans. The reduction in the repo rate will certainly bring down the loan interest rate by at least 2% to 3%. From the 13%-15% range that is prevailing now housing loans are likely to come down to the 10%-11% range. Here the RBI has given the existing loanees a carrot. It

One has to commend the apex bank for having made references to some key issues which give the credit policy statement announced on April 17 a different look as well as a different dimension.

has directed that all those who repay old loans by taking fresh loans shall not be subjected to the existing penal interest which these people have to pay for premature closure of loans. So the credit policy has provided relief not only to new loan aspirants but also to those existing loanees provided they take some pains to close their existing loans and go in for fresh ones. Vehicle loan aspirants are also likely to get the same relief as a result of the reduction in the interest rates and this in turn should provide the sector with a real boost. A major criticism often levelled against the banks is their tendency to effect increases in the loan rate at supersonic speed while the reduction in loan rates is at a snail’s pace. This has also been referred to in the credit policy and the RBI has come down heavily on such tendencies shown by banks.

In his budget speech of March 16 the Finance Minister had expressed his deep concern about the rising fiscal deficit. While this was measured at 5.9% of the GDP during 2011-12, the Minister hoped to bring down this deficit to 5.1% in the current fiscal. The RBI has addressed itself in this direction also. The necessity to reduce subsidies also finds a place in this credit policy. The policy has made the bold recommendation that the prices of pe-

First of all the policy has made a refreshing change to the interest rates.

Quite unexpectedly the repo and the reverse repo were reduced by 50 basis points. Business and industry along with the economists expected a maximum reduction of 25 basis points since inflation had declined only marginally from 6.95% in February to just 6.89% in March. Further the actuals of January had also come. Though the inflation rate for January was given as 6.55%, the actual worked out to 6.89% when the revised estimates were released. Moreover the Government had expected to peg March inflation at

troleum products should be raised to decrease the fiscal deficit. Though not in quite certain terms, the RBI favours the removal of statutory pricing in the case of diesel also. This move, the policy claims, will not fuel inflation. At the current rate there is confidence in the circles of the apex bank that it will be possible to curb inflation at the 6.5% level. Besides, the policy has not played to the gallery regarding the prospect of growth in the next fiscal. During 201213 GDP growth has been kept at 7.3%, compared to 6.9% in the current year.

One has to concede that the policy has shown quite a realistic approach while estimating growth prospects.

A major issue which the RBI has addressed in its credit policy is to formulate policies as a follow-up of the budget proposal to raise the import tax on gold from 2% to 4%. During 201112 gold imports reached a phenomenal 969 tonnes, making India the largest importer of the yellow metal. But domestic prices did not ease by any means. Gold continues to hover round the Rs 21,000 mark per sovereign despite the liberalized imports. The NBFCs were undoubtedly the greatest beneficiaries and jewellery shops are opening at a much faster rate than shops selling essentials. Banks were financing the NBFCs without any disdain and this further spiralled gold prices. The decision of the credit policy to put a cap on bank advances at 7.5% instead of the current level of 10% to NBFCs is a good move. The amusing thing is the move is welcomed by all except the gold traders who are squealing that gold imports may fall 30% in the next fiscal to 655 tonnes. The contention that China may overtake India in gold consumption is being given as a serious issue by the traders. It is indeed a relief that the RBI does not regard this as a record worth holding and has gone ahead with its decision to control the consumption of gold.

(Dr Ajith Kumar is a freelance writer)

PASSLINE

April 30-May 31, 2012

GCC STATUS

18 Against the backdrop of extensive energy sources, enormous Government spending, a strong banking sector and committed governments it is clear that the GCC countries will have a bright and better future. At the same time it is clear that the unresolved issues like the European crisis, the slow revival of the global economy and social problems which have created pressure on different countries including the GCC region will continue.

Economic crisis in Gulf and consequences in global markets

By Krishnan Ramachandran

It is the income derived from the oil resources that gives strength to the GCC countries to withstand the financial tremors that ravage the global economic equilibrium. Even at the height of the economic crisis in Oman and Bahrain the GDP of the GCC countries remained at 7%. Because of the anxiety over the faltering economic situation and the slump in the income from oil it is expected that the GDP may remain at the level of 4% to 5% in the GCC countries.

T

he Gulf Cooperation Council (GCC) which owns 40% of the world’s oil and 23% of its natural gas is one of the 20 prominent economic powers.

The GCC which comprises the UAE, Oman, Qatar, Saudi Arabia, Kuwait and Bahrain has some special features compared to other countries in the Middle East and North Africa. Among the common features of the GCC countries the significant one is the oil deposit. Not only have they huge oil and gas deposits but their per capita production is very high, higher than those of other oil-rich nations. The density of population is very low there in comparison with that of other oil-rich countries. The condition is the same relating to the population of expatriates in these countries.

The governments of the GCC countries stand together in facing any crises and losses. GCC nations are committed to diversification and development in the economic arena.

The bitter experience of the economic recession of 2008-2009

has given them an inducement to strive for economic growth. In view of this there is the need to recast the economic structure of these countries for further development. And for development, viable projects costing $1.80 trillion are envisaged.

It is the income derived from the oil resources that gives strength to the GCC countries to withstand the financial tremors that ravage the global economic equilibrium. Even at the height of the economic crisis in Oman and Bahrain the GDP of the GCC countries remained at 7%. Because of the anxiety over the faltering economic situation and the slump in the income from oil it is expected that the GDP may remain at the level of 4% to 5% in the GCC countries.

Following certain economic and social issues, including unemployment, in the Middle East and North African (MENA) region the

GCC leaders had decided to take some measures to revive the economy. More Government jobs, liberal lending policies, increasing benefits in the housing sector and steps to increase infrastructure and education facilities were the most important among them. These steps involved huge expenditure.

Coming to the banks in the GCC region, they were all well-armed to tackle the recent global economic crisis. At the same time they got tremendous Government backup which helped them. During 2009 and 2012 they had really to face difficult problems. The real estate crash, the dues of Saudi firms, the Dubai crisis and issues related to investment companies in Kuwait are some of them. From the beginning of 2011 on the performance and profit front the banks have made a healthy comeback. The banks now maintain a higher capital adequacy ratio than stipulated by rules.

Liberal economic policies and an improved business climate are going to be the factors that will help the growth and development of these areas. What the GCC is adopting is measures intended to raise the international trade and capital flow to boost investment from the developing markets.

Against the backdrop of extensive energy sources, enormous Government spending, a strong banking sector and committed governments it is clear that the GCC countries will have a bright and better future. At the same time it is clear that the unresolved issues like the European crisis, the slow revival of the global economy and social problems which have created pressure on different countries including the GCC region will continue.

(The writer is CEO of Barjil Geojit Securities LLC)

PASSLINE

April 30-May 31, 2012

ISSUES

19

By K Vijayachandran

T

he recent tsunami-induced accident at the Fukushima nuclear power plant has led to the revival of a decadeold agitation against Kudankulam Nuclear Power Plant (KKNPP) in Tamil Nadu, organized by a couple of nongovernmental organizations (NGOs) and supported by a section of the local Christian church. Their demand is the abandonment of the plant. Construction and trial runs at subsystems level have been successfully completed and the 2X1000 MW plant was getting ready for commissioning when the agitators put up a blockade against the employees of Nuclear Power Corporation of India Ltd (NPCIL).

The Jayalalithaa Government had taken a populist stand and supported the blockade, pending a detailed study by its own expert committee, even though 2000 MW of power from KKNPP would have brought in immediate relief to the power-starved Southern grid in general, and Tamil Nadu in particular.

The grid was losing the big advantage of low-cost power at Rs 2.5 a unit and NPCIL was registering a financial loss of Rs 50 million for every day of delay in commissioning. Revival of the agitation by the People’s Movement Against Nuclear Energy (PMANE) was a totally unacceptable initiative in national interests. Manmohan Singh, in his capacity as Prime Minister of the country, was under compulsion to criticize the NGOs for misusing US donations.

Jayalalithaa has now fallen in line, the agitation contained and commissioning activities resumed with the full cooperation of NPCIL employees.

Kudankulam and India’s nuclear programme The Jayalalithaa Government had taken a populist stand and supported the blockade, pending a detailed study by its own expert committee, even though 2000 MW of power from KKNPP would have brought in immediate relief to the power-starved Southern grid in general, and Tamil Nadu in particular. The grid was losing the big advantage of low-cost power at Rs 2.5 a unit and NPCIL was registering a financial loss of Rs 50 million for every day of delay in commissioning. Revival of the agitation by the People’s Movement Against Nuclear Energy (PMANE) was a totally unacceptable initiative in national interests. Manmohan Singh, in his capacity as Prime Minister of the country, was under compulsion to criticize the NGOs for misusing US donations. Jayalalithaa has now fallen in line, the agitation contained and commissioning activities resumed with the full cooperation of NPCIL employees.

It is not the first time that India’s atomic energy programme has turned controversial within the country as well as globally. Dr Homi Bhabha and his colleagues started working on a national atomic energy programme even

Critics and commentators of India’s nuclear programme often fail to take a holistic view of this national endeavour. First there are doubts about the relevance and safety of nuclear electricity.

If we go by global trends, as revealed by IAEA reports (www.iaea.org) of the UN, the Indian programme appears to be quite relevant and in tune with global realities. During the past quarter century, global generation of nuclear electricity has trebled. However, it continues to be the prerogative of the developed world, despite decades of global nuclear cooperation. OECD countries along with Russia and other CIS countries accounted for nearly 93% of nuclear electricity generation in 2010: developing countries including India and China accounted for hardly 7%. Among the developing countries, apart from India and China, only Brazil, Argentina and South Korea have nuclear power plants.

PASSLINE

before independence. This programme was endorsed by the Nehru Government and its national Five-year Plans: India has built large technological infrastructure related to the peaceful use of atomic energy, including nuclear electricity, based on the perspectives that atomic energy was the energy source of the future. India was the founding member of the International Atomic Energy Agency (IAEA), the UN organization dedicated to promoting global cooperation in the peaceful use of atomic energy.

It is now common knowledge that IAEA, instead of developing as a framework for international cooperation, had degenerated into a policing arm of the UN at the beck and call of the US in the name of preventing nuclear infiltration. The real intention of the US seems to be reinforcing the technological hegemony over future energy sources as part of a long-term strategy, and not the prevention of infiltration of nuclear arms. The US had taken the initiative of setting up a pocket organization of its own, and outside the UN framework April 30-May 31, 2012

of IAEA, under the banner of Nuclear Suppliers’ Group. NSG was used as an instrument for restrictive policies and the US had prevented even Germany, Italy and Japan, the good old axis powers, from developing total capabilities in nuclear engineering.

Development of nuclear capabilities outside of the IAEA-NSG framework is simply impossible for most countries thanks to the massive resource requirements—fiscal, material as well as human. The US has developed immense capabilities under the all-powerful state organ, Nuclear Regulatory Commission, which serves as technology providers for NSG members. The UK and Canada were pioneering countries in nuclear power, but has virtually withdrawn from the competitive market. For historical reasons, France and the former Soviet Union had stuck to their own independent programmes, and have succeeded in large measure in challenging US monopoly in nuclear technologies. India and China, thanks to their sheer size, could succeed in pursuing an independent path.

20 The three-stage nuclear power development programme envisaged by the Bhabha team had taken into account the limitations of uranium resources in the country and the possibility of using the readily available thorium resources by developing appropriate breeder technologies. This Indian programme has successfully crossed the halfway mark already. With the commissioning of the 570 MW Fast Breeder Reactor Unit within a year or so, at the Kalpakkam complex in Tamil Nadu, India will enter a really exciting phase of its nuclear energy programme. Completing this unit successfully is of great critical relevance.

The agitation around KKNPP in Tamil Nadu has to be seen from this overall national perspective.

Jayalalithaa

Unlike the nuclear programme of the US with its massive weapon components, the Indian programme is dedicated to the peaceful use of atomic energy (see www.dae.gov.in ). The UK, Canada and the US were India’s pioneering partners in nuclear cooperation for historical reasons. The Indian programme, based on a three-stage development strategy leading to the establishment of breeder technology, was an eyesore for these countries. However, considering the massive long-term market for nuclear power equipment in India, the US had permitted the export of two 160MW units for the TAPP from the US and one 100MW PHWR for the RAPP from Canada. These units were set up in the late sixties on a purely commercial basis.

Critics and commentators of India’s nuclear programme often fail to take a holistic view of this national endeavour.

First there are doubts about the relevance and safety of nuclear electricity. If we go by global trends, as revealed by IAEA reports (www.iaea.org) of the UN, the Indian programme appears to be quite relevant and in tune with global realities. During the past quarter century, global generation of nuclear electricity has trebled. However, it continues to be the prerogative of the developed world, despite decades of global nuclear cooperation.

OECD countries along with Russia and other CIS countries accounted for nearly 93% of nuclear electricity generation in 2010: developing countries including India and China accounted for hardly 7%. Among the developing countries, apart from India and China, only Brazil, Argentina and South Korea have nuclear power plants.

engineered, constructed and built by Indian scientists, engineers and workmen.

The success of India’s nuclear power programme has to be judged in this global perspective: A summarized report on the status of nuclear power in the country is presented in the table.

There are five nuclear power stations in India today: in Maharashtra, Rajasthan, Gujarat, Karnataka and Tamil Nadu. There are 20 operating units with a total capacity of 4780 MW. Barring the two units of 160 MW of US make in TAPP and one 100 MW of Canada make in RAPP, all others are Pressurized Heavy Water Reactor (PHWR) type: They were developed,

Even among the five new power stations under construction, barring the two KKNPP units, all others including the fast breeder reactor power station are designed, built and fuelled indigenously. In this process, India has developed a large team of over 45,000 experts and experienced workmen.

This human resources base, along with the two dozen public enterprises and autonomous organizations, including the Nuclear Regulatory Board, under the Atomic Energy Commission, is the backbone of the Indian nuclear programme.

Table Nuclear power plants in India A. Operating units State

Nos Capacity

MW

Remarks

Maharashtra-TAPS

4

1400

2x160 MW US BWR + 2X540 Indian PHWR

Rajasthan-RAPS

6

1180

Indian PHWR

Tamilnadu-MAPS

2

440

Indian PHWR

Karnataka-KAPS

4

880

Indian PHWR

Uthar Pradesh-NAPS

2

440

Indian PHWR

Gujarat (KAPS)

2

440

Indian PHWR

Total operating

20

4780

93% capacity-Indian PHWR

Tamilnadu-Kudankulam

2

2000

Russian-Light Water

Gujarat –KAPS

2

1400

Indian PHWR

Rajasthan RAPS

2

1400

Indian PHWR

Tamilnadu -fast breeder

1

570

Total under construction

7

5370

B. Under construction

Indian Fast Breeder-Thorium PASSLINE

Unlike the nuclear programme of the US with its massive weapon components, the Indian programme is dedicated to the peaceful use of atomic energy (see www.dae.gov.in ). The UK, Canada and the US were India’s pioneering partners in nuclear cooperation for historical reasons. The Indian programme, based on a three-stage development strategy leading to the establishment of breeder technology, was an eyesore for these countries.

However, considering the massive longterm market for nuclear power equipment in India, the US had permitted the export of two 160MW units for the TAPP from the US and one 100MW PHWR for the RAPP from Canada.

These units were set up in the late sixties on a purely commercial basis.

There were numerous hitches in implementing these projects and finally under the pretext of the Pokhran explosion ordered by Indira Gandhi in 1975, the US and Canada refused to honour even their commercial obligations. And as alleged by the present Prime Minister of India, while piloting the IndoUS nuclear deal in 2007, India was treated as a nuclear pariah by the global community.

The fight put up by our nuclear establishment against the pariah status imposed on the country was, indeed, creditable. It had, in the late 1970s, launched a ‘10,000 MW by 2000’ programme based on the serial manufacture of 220 MW units, developed and perfected by Bhabha Atomic Research Centre (BARC) in cooperation April 30-May 31, 2012

with public sector industries like BHEL and others. This had its matching components for uranium mining and production as well as related fuel processing technologies. The anti-nuclear lobby within the country had launched a massive propaganda war against this programme within and outside Parliament. Narora in UP and Kaigai in Karnataka had witnessed prolonged anti-nuclear agitations by NGOs as we witness today in Tamil Nadu. In the uranium mining sites in Andhra Pradesh and Jharkhand and Orissa, there were struggles by tribal people under the leadership of Christian missionaries.

The programme was slowed down by paucity of funds and inadequate logistical support by the administration. The partial success in capacity addition, scored by the Department of Atomic Energy (DAE) during the last quarter century, needs to be judged from this overall perspective. Recommissioning of the units abandoned by the US and Canada, stabilizing of the 220 MW design, development of the 540 MW and 700 MW designs as well as the big progress in breeder technology are not mean achievements.

The agreement for setting up KKNPP in Tamil Nadu was signed with the Soviet Government in 1988 when India was looked down upon as a nuclear pariah, according to our present Prime Minister. The Russian Government had inherited the project from the Soviet Union and its implementation was delayed by a minimum of ten years thanks to the dissolution of the USSR. The plant was built by NPCIL with Russian reactors, and the entire plant was designed and built jointly in a cooperative spirit with the Russians and has given Indian engineers an opportunity to learn reactor technologies and practices different from those of the PHWR plants developed by them. And, unlike the new nuclear power plants proposed by France and the US, based on the new nuclear deal, the 1,000 MW units of KKNP are highly cost-effective and have proven safety records. The experts committee appointed by the Tamil Nadu Government in response to the local agitations could not find any incriminating evidence against the safety of KKNP, even against the background of the Fukushima disaster.

Having come out of the nuclear pariah status, as claimed by our Prime Minister, how could we approach and evaluate the financial and political pressures for importing nuclear power plants into India? First, we have to ensure that such proposals do not derail or affect the Indian programme in any manner in terms finance and manpower resources. It has proved to be of great value and relevance to India’s economic development. Safety has to be ensured, considering the IAEA norms and the plant has to be cost-effective under Indian conditions, as well as economically attractive in the long run.

And, taking into account the long-term and far-reaching implications of nuclear power, such judgments have to be made in an open transparent manner, with the knowledge and full involvement of the Indian Parliament.

INDUSTRIES

21

How kind is the budget to MSMEs?

By G Rama Mohanan Nair

On the whole the budget is considered by medium, small and micro-enterprises (MSMEs) as balanced and mature.

F

Finance Minister Pranab Mukherjee had to present his budget this time under severe adverse pulls and pushes. Firstly, the country’s GDP growth rate has fallen from 8.4% during the past two years to 6.9 % in 201112. The fiscal deficit has increased from 2.8% in 2008 to 5.9% in 2011-12.

The Government could not reduce the price index by reducing the fiscal deficit. Thus the responsibility of controlling the prices came upon the Reserve Bank. The apex bank has made it clear to the Government that it cannot reduce interest rates until the fiscal deficit is brought down. In this context the experts advised the Government that the thrust in the budget should be to reducing the fiscal deficit.

Pranab proposes to mobilize additional resources to the extent of Rs 41,400 crore by enhancing both excise duty and service tax by 2% and spreading the net of service tax wider. (All except 17 services are now covered under service tax.) He expects this will reduce deficit to 5.1%. This in turn will help the RBI to reduce interest rates.

His expectation is that we will be able to achieve a GDP growth rate of 7.6% this fiscal.

Industries: Good roads, port facilities, storage facilities like godowns and warehouses, good airports, power plants, dams, oil and gas/LNG storage facilities, oil and gas pipelines, fixed networks for telecommunication and telecommunication towers etc are very essential ingredients of infrastruc-

ECB is permitted subject to a ceiling of $1 billion ($ 100 crore) to tide over its present crisis. A proposal to allow 49% equity participation by foreign airlines is also under consideration.

Delhi-Mumbai Industrial Corridor (DMIC): DMIC is being developed on either side of the alignment of the Western Dedicated Rail Freight Corridor. In September 2011, Central assistance of Rs 18,500 crore spread over five years had been approved. Japan has announced $4.5 billion as its participation in DMIC project.

MSMEs: To facilitate availability of equity to the MSME sector, a proposal has been made to set up a Rs 5,000crore India Opportunities Venture Fund with SIDBI. SMEs are the building blocks of our economy. They rely primarily on loans from banks and informal sources to raise capital. To enable better and easier finance, two SME exchanges have been launched in Mumbai recently.

ew analyses of the Union budget had focused on its effect or impact on industries, especially on the medium, small and micro-enterprises (MSMEs). The objective of this article is to fill that gap.

Again this is a highly balancing act.

In a coalition government the FM has to prepare an economically sensible budget by increasing revenues and cutting expenditure, at the same time making it politically acceptable to all constituents of the coalition. (Remember what Mamata Banerjee had done with the railway budget prepared by her own party’s Minister).

sis because of the high cost of aviation turbine fuel (ATF). The Government is now permitting the Indian carriers to import ATS as actual users to reduce cost.

Public procurement policy: Central public sector enterprises (CPSEs) should make a minimum of 20% of their annual purchases from MSEs of which 4% should be from MSEs owned by SCs/STs. A special concession to power sector: Domestic producers of thermal power have been under stress because of high prices of coal. It is proposed to ease the situation by providing full exemption from basic customs duty and a concessional CVD of 1% to steam coal for two years till March 31, 2014.

Full exemption from basic duty is also being provided to the following fuels for power generation: natural gas and LNG, uranium concentrate, sintered uranium dioxide in natural or pellet form etc.

ture needed for faster growth of industries. In recognition of this fact, a provision of Rs 50 lakh crore has been made for the 12th Plan period (201217). Half of this has to be attracted from the private sector through public private participation (PPP). Wherever the gestation period is too long for a break-even, viability gap funding (VGF) has been envisaged.

National Manufacturing Policy (NMP): The Government announced NMP on October 25, 2011 with the objective of increasing the share of manufacturing in GDP to 25% and creating one crore jobs in the next one decade. It is proposed to promote several National Investment and Manufacturing Zones (NIMZs) across the country.

Rs 60,000-crore tax-free bonds have been announced in 2012-13 for financing infrastructure as against Rs 30,000 crore during the previous year.

The break-up is:

Power and fuel: In power generation, fuel supply constraints are affecting production prospects. Coal India has therefore been advised to sign fuel supply agreements with power plants that are scheduled to be commissioned on or before March 31, 2015. External commercial borrowings (ECBs) have been allowed for part-financing rupee debts of existing power projects.

NHAI—Rs 10,000 crore; IRFC—Rs 10,000 crore; IIFCL—Rs 10,000 crore; HUDCO—Rs 5,000 crore; National Housing Bank- Rs 5,000 crore; SIDBI—Rs 5,000 crore; Ports—Rs 5,000 crore and Power Sector—Rs 10,000 crore Further, India Infrastructure Finance Co Ltd. (IIFL) has put in place a consortium of financiers to extend finance to developers easily.

PASSLINE

Roads and civil aviation: During 2011-12, NHDP had been given a target of 7,300 km. This fiscal it has been given a target of 8,800 km. Rs 25,360 crore has been budgeted for this. The aviation sector is facing a financial criApril 30-May 31, 2012

Manufacturing sector: To reduce the cost of raw materials and components and to curtail competition through imports, many changes in customs duty have been made. The areas benefited are steel industry, textile industry, medical devices manufacturers and some sectors of the electronics industry.

Some other reliefs: Individuals can invest capital gains from the sale of their residential property for procurement of plant and machinery of MSMEs and benefit from tax exemption.

For MSMEs the threshold limit for statutory audit has been enhanced from Rs 60 lakh to Rs 100 lakh.

On the whole the budget is considered by MSMEs and industries as balanced and mature. Now the challenge before MSMEs as usual will be to fight out for these concessions and benefits through the iron curtains of the bureaucracy/implementing agencies.

(The author is a member of the guest faculty at Indian Maritime University- Kochi Campus).

DEMOGRAPHY

22

Growing population—asset or liability?

The country’s population grew by 180 million from 1,029 million in the last census in 1901 to 1,209 million in 2011. Percentage-wise, the population during the past decade recorded a moderate growth rate of 17.64%.

This is less than that during the earlier decade.

Interestingly, India’s population, second after China, is almost equal to the combined population of the US, Brazil, Indonesia, Pakistan, Bangladesh and Japan together. Our total population accounts for 17.5% of the world’s population.

By P D Johny (pdjohnny@yahoo.in)

T

he details of the statistical part of India’s Census 2011 were released in April 2011 and the analysis from different angles is being released by the Registrar General of India from April 2011 onwards. The macro-level data indicates that the country’s population grew by 180 million from 1,029 million in the last census in 1901 to 1,209 million in 2011. Percentage-wise, the population during the past decade recorded a moderate growth rate of 17.64%. This is less than that during the earlier decade. Interestingly, India’s population, second after China, is almost equal to the combined population of the US, Brazil, Indonesia, Pakistan, Bangladesh and Japan together. Our total population accounts for 17.5% of the world’s population.

Census 2011 was the 15th in the history of India; the first was conducted in 1871 by the British Raj. The first census was, however, not a complete exercise as it did not cover all territories then under British India. The first complete and comprehensive headcount was undertaken in 1881. Thereafter, the demographic exercise is being undertaken once in every decade. The first exercise of this kind after independence was undertaken in 1951. The growth in population of the country had grown from 238.4 million in 1901 to 361.1 million in 1951 and further to 1028.7 million in 2001. The growth during the first half of the 20th century was merely about 52% but, during its latter half, coinciding with the post-independence period, the population grew phenomenally by about 185%. The separation of Myanmar (then Burma), Sri Lanka (then Ceylon) and the undivided Pakistan (which included the present Bangladesh) had taken place during this part of the century and the relatively low growth rate in population during the period can be attributed to these geographical developments. During the second part of that century, geographically, the country remained more or

l e s s unchanged, except the addition of the tiny Himalayan state of Sikkim in 1976.

As the country’s resources, mainly the production of food grains, lagged far behind, this alarming growth rate in population during the post-independence period prompted the planners to press the panic button and control the population through birth control methods. The Malthusian Theory of Population Explosion was quite evident in the country, with everincreasing population and with production of essential commodities keeping

a very slow pace. Besides creating awareness on the perils of unrestricted increase in population and advantages of smaller families, slogans like ‘We two and ours two’ first and ‘one-child norm’ subsequently were the norms vigorously popularized, even generous incentives, both in cash and kind, were offered to those who practised these norms. By the end of the 20 th century, these measures started yielding positive results.

Nevertheless, the present growth rate of 17.64% cannot be termed quite

State-wise, Uttar Pradesh continues to be the most populous state with 199 million followed by Maharashtra with 112 million. Lakshadweep has the least population among all states and Union Territories with just 64,429 people.

Gender-wise, males outnumber females in the country as a whole—622.2 million males against 586.5 million females. The male-female ratio slightly improved from 933 females for every 1000 males in 2001 to 940 in 2011.

This mismatch still is a matter of concern as it points to the gender bias prevailing in some parts of the country which include northern states like Haryana, Uttar Pradesh and Rajasthan. The picture is different in a few states like Kerala where the male-female ratio is very positive— 1,084 females for 1,000 males.

PASSLINE

April 30-May 31, 2012

satisfactory, although the production of food grains (except pulses) has reached new heights ensuring a sort of self-reliance.

Feeding 1,210 million mouths is not as herculean a task now as it was earlier. Still, with the galloping inflation, affordability of decent food in quality and quantity is still a challenge before at least one-third of the country’s population which is languishing ‘below the poverty line’. The controversial proclamations of the Planning Commission that an individual can be assured of two square meals a day if he earns Rs 25 to Rs 30 a day are only laughable.

State-wise, Uttar Pradesh continues to be the most populous state with 199 million followed by Maharashtra with 112 million. Lakshadweep has the least population among all states and Union Territories with just 64,429 people. Gender-wise, males outnumber females in the country as a whole— 622.2 million males against 586.5 million females. The male-female ratio slightly improved from 933 females for every 1000 males in 2001 to 940 in 2011. This mismatch still is a matter of concern as it points to the gender bias prevailing in some parts of the country which include northern states like Haryana, Uttar Pradesh and Rajasthan. The picture is different in a few states like Kerala where the malefemale ratio is very positive—1,084 females for 1,000 males. However, this trend may not sustain if we take into account the position of children below 6 years—the ratio of female children even in Kerala has sharply declined to 959 per 1000 male children. By the end of next decade, Kerala may go the Haryana way, if this trend is not arrested. At the national level, during the last decade, the male

23 population has grown at 16.46%, while that of females 18.12% which is certainly a positive sign. Another notable aspect is the declining growth rate observed in the most populous states like Uttar Pradesh and Maharashtra during the last decade.

Literacy rate—an important indicator of development—has improved significantly by 9.21 points from 64.83% to 74.04% at the national level (males 82.14 and females 65.46) during the decade which is acclaimed as the result of the consistent efforts by the governments and voluntary agencies in most of the states. In this aspect, Kerala, as before, tops the list with over 94% followed by the Union Territory of Lakshadweep with over 92%.

As for Kerala, there are many reasons to be proud of—the state with a population of 3,33,87,677 recorded the least growth rate in population during the last decade, 4.86%, against the national average of 17.64%. The present sex-ratio continues to be favourable—1,084 females for every 1,000 males. On the literacy front too, the state’s position is enviable at over 94%. Child (below 6years) and mother mortality ratio is the lowest in the country, thanks to the satisfactory level of health services available in the state. Density of population (per square kilometre] in the state is one of the highest in the country.

The provisional data on the demographic pattern of the country provides certain soothing and, at the same time, disturbing pieces of news. Most importantly, the uncontrolled growth in population has been arrested to some extent as it now has come down to 17.64% compared to 21.54% recorded during the earlier decade ended 2001, signalling the possibility of stabilization in this respect in the next few decades. Increase in population at the present rate does not worry the planners so much now as it did during the second half of the last century. Good news coming from the food grains production front in recent years should also make the planners heave a sigh of relief, provided the present production level is sustained and systematically stepped up. The gap between the projections and realization in the growth of gross domestic product (GDP) is still a cause for worry. Though the position of the services sector continues to be satisfactory, uncertainty is a matter of concern in respect of other sectors—agriculture and industry.

Some disturbing features revealed in the current census include the declining sex ratio mainly because of preference for male children in some parts of the country which is certain to cause a lot of social implications. This also indicates the fact that sex determination tests during pregnancy and medical termination of female fetuses, despite stringent legal strictures, is still prevalent in many parts of the country. While some states like Tamil Nadu have succeeded in preventing such undesirable and self-defeating practices through rewards and punishments selectively, some northern states have miserably failed in this cru-

cial area. Another adverse feature revealed is the large-scale migration from rural to urban areas. The population in urban areas is observed to be increasing at a faster pace compared to rural areas. Decline in opportunities for employment in agriculture and other rural

country has sharply declined and the number of people living under the socalled ‘below the poverty line’ has come down to a tolerable level of 34% of the population.

Using the common yardsticks of the country’s development and its

Literacy rate—an important indicator of development— has improved significantly by 9.21 points from 64.83% to 74.04% at the national level (males 82.14 and females 65.46) during the decade which is acclaimed as the result of the consistent efforts by the governments and voluntary agencies in most of the states. In this aspect, Kerala, as before, tops the list with over 94% followed by the Union Territory of Lakshadweep with over 92%. There are also many other reasons for Kerala to be proud of—the state with a population of 3,33,87,677 recorded the least growth rate in population during the last decade, 4.86%, against the national average of 17.64%. The present sex-ratio continues to be favourable—1,084 females for every 1,000 males.

sectors might be a possible cause for the flight of more and more people into urban areas in search of jobs.

Now, based on the available data on population of the country, the strengths and weaknesses along with the opportunities and challenges have to be analysed. More than one-sixth of the world population (nearly 121 crore) live in this country. Self-sufficiency on the food grains front is a matter of relief, but that apart, the question to be answered is whether the people have been able to raise their standard of living. The Planning Commission declares with immense pride that the incidence of poverty in the

people’s living standards, the Planning Commission’s conclusions may not be totally unfounded. The number of vehicles (both private and public) on the roads, mobile phones in use even in the remotest villages, good-quality housing at least in urban areas, stabilized financial sector after the reform era, generally improved infrastructure like roads etc give indications of some progress achieved by the country during the last two decades.

In the present context of development perspectives, India can be considered to be 121-crore strong, converting the population, however large it is, into an asset in terms of human

In the present context of development perspectives, India can be considered to be 121-crore strong, converting the population, however large it is, into an asset in terms of human resources. Although machines (including computers) have partially replaced human beings in many areas of activities, the country still needs magnitudes of human resources to sustain the current (as also projected for future) pace of development.

For instance, the approach paper for the 12th Five-year Plan envisages creation of 12 crore employment opportunities in the industrial production sector.

PASSLINE

April 30-May 31, 2012

resources. Although machines (including computers) have partially replaced human beings in many areas of activities, the country still needs magnitudes of human resources to sustain the current (as also projected for future) pace of development. For instance, the approach paper for the 12th Five-year Plan envisages creation of 12 crore employment opportunities in the industrial production sector. It is true the agricultural sector, as a result of inevitable mechanization and use of modern techniques to make farming more competitive, cost-effective and remunerative, might render some surplus labour which will have to be absorbed in the secondary and tertiary sectors.

The mismatch in calculations of the planners on the economic growth rate is caused by the fall in the achievements in the industrial production sector. The focus in the 12 th Plan document is on the rapid development of the industrial sector which includes healthy growth in the micro, small and medium enterprises [MSMEs], to give an impetus in the rural and semi-urban economies. The services sector has been growing strongly continuing to contribute significantly to the overall progress. However, as a strategy to achieve this objective, it is imperative to make the country’s population more productive, for which more and more skilled and semi-skilled labour should be built up. Regional disparities between the demand and supply of labour are experienced currently, necessitating movement of labour forces from the supplying states to those in demand.

The present labour situation in Kerala is a classic example—shortage of unskilled and semi-skilled labour for various economic activities in Kerala is met by the migrant surplus labour from even distant states like Bihar, Odisha, West Bengal and Assam. Kerala’s own labour force prefers and finds employment abroad, mainly in the Gulf countries, providing strength to the state’s economy. Some kind of levelling is taking place within the country as far as supply and demand of unemployment opportunities are concerned. Further, most of those unskilled poor who are unable to find jobs elsewhere, are provided with opportunities through the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) being implemented throughout the country since 2005.

Thus, the seemingly vast magnitude of India’s population, if properly used, is no longer a liability and drain on the country’s strained economy, but it can be transformed into a valuable asset by suitably upgrading through extensive skill development programmes and judicious deployment. The planners have, no doubt, taken note of these prospects and the success in meeting the targets set for implementation of 12th Plan (2012-2017) and the projected level of development resulting in achieving the desired growth of the country’s economy depends much on activation of these strategies.

CYBERCOACHING

24

Online tutors just a click away

By Kavitha Rajeev Kumar

Online tutoring or e-tutoring has gained popularity across the world as an online service, giving students help they need to succeed. Tutors can provide assistance to students from any place where they have an internet connection, at any convenient time. To teachers it means a different method of working in the field of education and to earn extra income from the comfort of their home.

A

t the end of every school day, ninth-grader Jack Taylor heads home for a session with his tutor.

But Taylor ’s tutor, Ishwar Subramaniam, doesn’t come to his house. In fact, he has never been to America.

Ishwar lives in Bangalore, India, 14,400 km from Taylor’s California home. A former schoolteacher who holds a master’s degree, Ishwar is one of a growing number of highly educated Indians now tutoring US students over the internet.

Online tutoring or e-tutoring has gained popularity across the world as an online service, giving students help they need to succeed. Tutors can provide assistance to students from any place where they have an internet connection, at any convenient time. To teachers it means a different method of working in the field of education and to earn extra income from the comfort of their home.

Students from elementary to graduate schools and above or even adults can get help any time of the day or night. Subjects range from mathematics to English or even commercial and vocational subjects, modern and classical languages, voice coaching and music lessons, hobby classes, creative writing, elocution, study skills, public speaking, presentation skills, accent removal etc.

This type of tutoring can make use of several web-based programs like email, an instant messaging, online whiteboards, videoconferencing, audio conferencing, discussion boards, private messaging, etc. Online tutoring is most effective when voice, video, graphics, and text can all be used at the same time. Through these programs or applications a tutor can teach concepts, help with confusing parts of a topic, solve problems, send quizzes, receive accomplished exams, send quiz results and recommendations, help or advice on assignments or

homework, assist in applying concepts etc.

Over 200 different subjects are available for teaching online. Parents/students register with a tutoring company and choose one of the several packages on offer. Students can thereafter schedule their classes entirely according to their convenience. The sessions can be held on a 24/7 basis. If the student is not satisfied with a session, some tutoring companies promise to return the money that they have charged from them.

Being a tutor requires special knowledge and skills in the subject.

Tutors are typically postgraduate degree holders, those with doctorates, graduates with tutoring experience and/ or qualified teachers. All prospective tutors are tested for subject knowledge, IQ and EQ. One need to be sensitive to the intellectual and emotional needs of your students. Excellent oral and interpersonal communications, adhering to the time schedule, performing duties in a professional and responsible manner and good English are other requirements most of the tutoring companies look for.

Some companies offer rigorous training and certification processes to become certified tutors. All teachers also undergo extensive third-party background checks before being recruited. Tutors get rating from their students and those with lower ratings get self-selected out from the system. One needs to be patient and committed to helping others.

Driving the trend of outsourcing teaching is cost. Private tutoring in the US can cost $100 an hour or more. An online session with an Indian tutor runs around $20 an hour—and can cost much less than that if students sign up for a monthly rate. The rate can even come down to $5-$10 an hour if they sign up with a tutor working independently.

Offshore tutoring companies are PASSLINE

still a relatively small segment of the $4 billion US tutoring industry. But they’re multiplying fast. Tutoring companies like TutorVista give all tutors 60 hours of language and cultural training to help them better relate to US students including teaching them American slang. Tutors undergo background checks and special training too.

Based on the US students he has tutored, Ishwar says he has come to the conclusion that maths “is occupying a low priority in the age group of 5 to 16 in American schools.” He is also struck by the ‘gratitude’ his US students express for his efforts on their behalf. In India, he says, “it is taken for granted that teachers have to do a good job.”

Students need the right equipment—a computer with fast internet access, a headset with a microphone and a tablet with a pen.

The service also can be impersonal—particularly if students don’t get to use the same tutor each time. And communication glitches are almost inevitable.

When Taylor started using the service, he had trouble understanding his tutor’s accent. Same was the case with Ishwar. He took some time to understand Jack’s accent.

Still, he says, the benefits, like the fact that he can attend his tutoring sessions in his pyjamas, outweighed the negatives. And, he says, the results at school had been noteworthy: “It has made me more prepared and more confident.” His mom concurs. “It’s just his attitude, the triumphant feeling he has.”

Relief for parents struggling to help their children with difficult homework is now just a click away—thanks to online tutoring. A subject matter expert or so-called tutor is available at a time convenient for the student.

A generation that is comfortable with online services seems to be taking to the service. “They have grown April 30-May 31, 2012

up on the internet. They can’t imagine life without it, and so online tutoring is a perfectly acceptable form of instruction for them,” says Dennis Gooler, assistant to the Director of San Diego Public Library.

Six days a week in the wee hours of the morning, Saraswati Reddy logs into her home computer. The homemaker and tutor from Hyderabad rises early to help American high school students write English term papers, prepare SAT essays or finish homework assignments. Reddy is working with students from Atlanta and New Jersey.

She logs into the Tutoring portal, uses webchat to greet her student. “Hello, Brittney,” she says. Her student responds back immediately. They switch to audio, and Reddy asks, “How have you been?” A polite sentence or two later, she queries, “How may I help you today?” The tenth grader has a quiz on Stephen Crane’s ‘The Red Badge of Courage’ the next day. The two discuss the novel and its characters.

Reddy probes Brittney on a few chapters and asks her several questions.

She writes the themes in the novel on the digital pad and they discuss as the words show up on their respective computer whiteboards.

Another homemaker and a tutor, Pushpa from Kochi, teaches a 60+year-old Mexican and a 20-something Japanese Hindi. Though she teaches them Hindi language, she gets questions on Indian history and culture. She uses a headset containing a microphone and a speaker in conjunction with voice chat applications like Skype or Google talk for communication. An online whiteboard or a shared screen where the lessons are posted and discussed works just like our blackboards. She also prepares presentations for explaining concepts. She works only 4-5 hours a day and earns $25-$35. And her qualification is a diploma in Hindi.

(The writer is a part-time online Hindi and Malayalam tutor)

25

NEWS

Students of Asian School of Business (ASB), the premier business school located in Kerala’s capital city of Thiruvananthapuram, walked home proud with their coveted diplomas in Management (Postgraduate Diploma in Management—PGDM), at the sixth annual convocation held at Pallippuram campus of the institution recently.

Smartly-robed prospective managers who entered the venue in a convocation procession received their diplomas from Mr C Balagopal, Managing Director of Terumo Penpol Ltd, who was also the chief guest of the event. He also gave away the awards to meritorious performers, in the presence of Mr G Vijayaraghavan, Member Secretary, Board of Governors, ASB, and Kerala State Planning Board Member.

Ms Clomy O S received the Best Outgoing Student Award for Academic Excellence and Mr Sharath S R got the Best Outgoing Student Award for All-round Excellence.

In his convocation address, Mr Balagopal spoke about the importance of accepting and learning from one’s mistakes and failures. “Mistakes and failures provide valuable lessons. Any attempt can only produce binary results—success or failure. Failure is a lonely place to be in, but with courage and character, failure can be turned into learning,” he said.

Mr Balagopal said that great stigma is attached to failure in the In-

Director’s Report. Prof V Harihara Subramanian, Dean, Management Development Programmes and Placement, ASB, proposed a vote of thanks.

The two-year PGDM of ASB aims to equip students for a career rather than for a job. The residential programme, anchored by experienced faculty members, adopts an instructional methodology involving case studies, projects, presentations, simulations and role-plays.

Mr G Vijayaraghavan, Member Secretary, Board of Governors of ASB, speaking at the annual convocation of the institution.

Sixth batch of biz managers pass out of ASB dian educational system and described it as a stumbling block to innovation and entrepreneurship in the country. “Innovation emerges through one’s willingness to try and readiness to fail.”

He narrated the case of his company Terumo Penpol, which was started in a small way and today employs a thousand people and exports to 50 countries. “We have survived and succeeded in the Indian and overseas

competitive market,” he added.

ASB Patron George M Thomas delivered the presidential address. He exhorted students not to allow themselves to be let down by occasional setbacks and invest in the development of one’s intellectual capital, together with enthusiasm, motivation and commitment.

Prof S Rajeev, ASB Director, welcomed the gathering and presented the

ASB, which has emerged as a leader in management education with innovative programmes and collaborations with foreign institutions, has also invited applications for the 2012-14 batch of the AICTE-approved two-year, full-time PGDM programme. Designed both for candidates with substantive work experience and for fresh graduates, the programme demands high intellectual vitality, academic excellence and leadership qualities, besides commitment to pursue a management career. The business school is looking to fulfil the rising requirement for trained managers all over Asia, especially for burgeoning rural markets.

ASB is also forging professional alliances with reputed international academic institutions such as Kansas University School of Business (KUSB), and two management institutions in Central Europe. In addition, it has announced special scholarships for students from West Bengal and the North-East.

Maruti Suzuki unveils Ertiga

ICAI sets off to achieve its global vision Affirming its pledge to make India’s accounting system a model for countries around the globe for competitiveness, efficiency and ethics, The Institute of Chartered Accountants of India (ICAI) – the world’s second largest accounting body – recently marked the 40th anniversary of its Thiruvanantha puram branch. The key milestone for the branch, which currently has over 500 members and 800 students under its umbrella, comes as the ICAI steps up efforts to achieve the objectives listed in its farsighted ‘Vision 2030’ plan unveiled early this year by which the institute aims to become the “world’s leading accounting body, a regulator and developer of trusted and independent professionals with world-class competencies in accounting, assurance, taxation, finance and business advisory services”.

ICAI President Jaydeep Narendra Shah highlighted the organization’s various initiatives to raise the competencies of its members and students; strengthen governance across the public sector, corporates and industries

and further public interest, at a press briefing.

Mr K Viswanath, Chairman of the South India Regional Council (SIRC) of ICAI, Mr Rajarajeswaran P V, Secretary, SIRC, Mr M Devaraja Reddy, Central Council Member ICAI, Mr Babu A Kallivayalil, former Chairman, SIRC, and Mr Alex Kuriakose, Chairman of the Thiruvananthapuram branch, were present at the meet.

As a statutory body, the ICAI’s foremost commitment is to assist with nation-building. It has taken several measures to help improve accounting practices in key sectors. It has issued three guidance notes for its members on accounting in real estate, oil and gas and other energy-related sectors. Real estate, where companies currently have no uniform system to recognize their incomes, is expected to benefit greatly from the new guidance notes.The Thiruvananthapuram branch ICAI was inaugurated on April 30, 1972. In 2003, it shifted to its current offices at Thycaud.

PASSLINE

Maruti Suzuki India Limited unveiled its first life utility vehicle Ertiga in Kochi on April 13.

“Ertiga represents the aspirations of young urban Indian families that are active and connected. It also displays Suzuki’s ability to bring compactness, style and high fuel efficiency to utility vehicles. India is the first market to sell Ertiga,” said Mr Manohar Bhatt, South Zone Business Head of Maruti Suzuki, at the unveiling function.

Ertiga offers flexi seating to accommodate seven people and a lot of baggage. Carrying forward the sporty, dynamic, bold and aggressive design philosophy of the Swift platform, Ertiga is available in seven different colours and in six trim levels. The petrol variant delivers a mileage of 16.02 km a litre and the diesel variant 20.77 km. It carries the K-Series, 1373cc VVT (K14B) engine.

“K14B is the third engine in the K-series technology introduced by Maruti Suzuki,” Maruti Suzuki Kerala region head Thomas Cherian said. The exshowroom price in Kerala for petrol and diesel starts at Rs 6,13,001 to Rs 8,71,283, respectively.

Actor Madhavan inaugrating Joyalukkas' Singapore showroom. George (Diamond manager, Dubai), P D Jose (General Manager, Gold India), Joy Alukka (Chairman, Joyalukkas Group), John Paul (MD, Joyalukkas Group), Joshy (Gold manager, Dubai) are also seen.

April 30-May 31, 2012

26

Wonder la launches XD MAX Wonder la, India’s most popular amusement park, has launched a state-of-the-art ride, XD MAX, at its Kochi Park. The new ride was inaugurated on April 28 by Excise and Ports Minister K Babu. “Wonder la’s growth is inspiring and now it has become one of the major tourist spots in South India. The new ride will be definitely a novel experience for the visitors,” said the Minister.

“The ride has been introduced to delight visitors’ senses and I hope they will enjoy it”, said Mr Kochouseph Chittilapilly, founder of the VGuard Group of Industries which owns Wonder la. XD MAX combines a 3D film with physical and environmental effects in an air-conditioned theatre that can accommodate 180 people and 3D goggles make this visual experience a total visual treat for the viewers. The ride will be equally exciting for both children and the grown-ups.

Physical effects like aroma of flowers, smoky atmosphere and swinging chairs could be quite a funny as well as thrilling experience for the audience. It provides an entirely new ecstatic experience for the visitors. No special entry fee will be charged for this spectacular show.

Kunnathunad MLA V P Sajeendran, Thrikkakara MLA Benny Behanan and Kunnathunad Grama Panchayat President Shaila Noushad also attended the inauguration ceremony. Wonder la Chairman George Joseph, Vice-President Nandakumar etc were also present.

Mr Arun, Ms Sheela, Mr Kochouseph, Mr Mithun at the news conference.

V-Guard Group forays into new areas V-Guard

Industries Ltd has crossed the Rs 1,000-crore gross turnover mark for the financial year 2011-12, a quantum jump of 10 times from its turnover of Rs 100 crore in 2000. Mr Mithun Chittilappilly, Managing Director of V-Guard Industries Ltd, has commended the longstanding support of the employees and channel partners for the performance and reiterated the group’s commitment to serve its customers with quality products.

and Little Valero, a spin-off from the lingerie parent brands Vanessa and Valero.

Mr Arun Chittilappilly, MD of Wonder la Holidays Pvt Ltd, says the newly opened sprawling resort with 84 luxury rooms at the Wonder la, Bangalore, theme park has five fully equipped business/celebration halls, a swank rest-o-bar ‘Red Ice’, a fine dining theme restaurant ‘Woods’, ultraluxury rooms, pools, recreation room and an amusement park to boot. Mr Arun also says that Wonder la’s next projects are parks near Hyderabad and Chennai.

Mr Kochouseph highlights the restructuring at the top management across the group companies.

He says that his elder son Arun has taken over as the new Managing Director of Wonder la Holidays Pvt Ltd and younger son Mithun has become the Managing Director of V-Guard Industries Ltd. Mrs Priya Arun Chittilappilly has been elevated to the position of Executive Director, Wonderla Holidays Pvt Ltd, and Mrs Joshna Mithun Chittilappilly is serving as the Executive Director of V-Star Creations Pvt Ltd. Mr Kochouseph will now continue in the role of Executive Vice-Chairman of both companies.

Mrs Sheela Kochouseph, MD, V-Star Creations Pvt Ltd, has announced the group company’s foray into kids innerwear with the launch of Little Vanessa

Mr Kochouseph Chittilappilly, founder, says that he will be devoting a considerable amount of his time to nurturing the new vertical of the group— real estate. Construction of luxury apartments at Vazhakkala, Kochi, on 50 cents of land has already started. The second project is a budget residential apartment complex coming up on one acre at Kaloor, Kochi.

‘Startup Village’ launched India’s first technology business incubator, ‘Startup Village’, was launched on April 15 at Kochi. Inaugurated by Kris Gopalakrishnan, Co-founder and CoChairman of Infosys and the chief mentor of the incubator, the venture aims to support and upraise startup entrepreneurs and to equip them to be up-to-date in the rapidly changing telecom landscape. “This is a milestone in Kerala’s development and a landmark in its growth. Startup projects need a conducive atmosphere to develop themselves. They will give a momentum to those who aspire to enter entrepreneurship. Lack of finance impedes entrepreneurship but a startup village facilitates a platform for surmounting those problems,” said Mr Gopalakrishnan.

Startup Village focuses on the telecom sector and is registered as a not-for-profit society under the Travancore-Cochin Literary, Scientific and Charitable Societies Registration Act, 1955. Being India’s first public-private partnership (PPP) model, Startup Village TBI is determined to keep pace with the fastchanging technology landscape. It is jointly promoted by the Union Government’s Department of Science and Technology and Technopark, the country’s largest IT park at Thiruvananthapuram, along with some private-sector firms. Various industry bodies such as Nasscom, CCI, TIE and COAI are also on board supporting the creation of one of India’s finest startup ecosystems.

The enterprise is set up with the vision of leveraging the impending explosive growth in smart phones and 4G to incubate the next 1,000 startups in India. It will be expanded to major cities soon.

Unlike many other incubation ecosystems in the country, Startup has high professional talent that is required to support the startups. From the very first day it has been keen to leverage the experience over the past five years and the network laid by the Technopark TBI into 155 engineering collegeshas given reach to 12,000 engineering students. Startup Village is founded on the three basic elements of’ incubator, accelerator and angel fund.

Incubator: The incubator is the basic building block where idea-stage entrepreneurs can build, break and innovate. India Angel Network holds the status of ncubator partner of Startup Village. This section provides starters with both hard and soft infrastructure. Hard infrastructure includes physical space, power security, work stations etc whereas soft infrastructure comprises computers, servers, WiFi, virtual office services etc. Incubator has also been set up with support infrastructure like CAs, lawyers, PR consultants and mentors and technology infrastructure as well. Technology Infrastructure comprises those key areas of infrastructure that are supplied to the Incubator in partnership with technology partners. The incubator is well implemented by a ‘Rubus Lab’ with the support of Blackberry.

Accelerator: The Centre for Innovation Incubation and Entrepreneurship is the official partner of the block. The accelerator programme here is similar to that at Silicon Valley accelerators. For the threemonth programme entrepreneurs are admitted in batches of 10 companies and are given active support to move from idea/prototype to V1.0 of the product. Along with $10,000 in seed capital, every company is provided with a host of introduction methods to network partners and angel investors.

During the accelerator programme, the startup entrepreneurs will benefit by the chance to interact with eminent tycoons like Kris, other startup CEOs, VCs and Angel Investors on scaling up the business and growth strategies.

The course would be done along with Centre for Innovation, Incubation and Entrepreneurship at IIMA and the industry.

Angel fund: The angel fund is a $10m fund which is likely to invest around $ 5,00,000 in high-growth startups. In case of high investments, the fund will co-invest with other angel funds. ‘Canaan Partners’, ‘Blume Ventures’, and ‘Kae Capital’ are the investment partners.

KPMG is the knowledge partner.

PASSLINE

April 30-May 31, 2012

Cera notches impressive performance Cera Sanitaryware Limited has recorded an impressive increase in net sales income for the year ended March 31, 2012. The company has posted an income of Rs 321 crore, a jump of over 32% over the net income of Rs. 243 crore achieved in 2010-2011. The company’s earnings per share at Rs 25 have registered an increase of Rs 4 per share over the EPS at the end of 2010-11.

The company’s profit from operations for 201112 before other income and finance costs has totalled Rs 45 crore compared to Rs 39 crore for the same period last year reflecting an increase of 16.5%. The profit before tax has amounted to Rs 49 crore, about 17% rise over the PBT of Rs 42 crore achieved during 2010-11.

The net profit after tax for the period has totalled Rs 31.78 crore compared to Rs 26.54 crore in the last financial year showing an increase of 20% According to unaudited results released by the company, it earned a net sales income of Rs 100 crore in the fourth quarter (JanuaryMarch 2012), compared to Rs 82 crore in January-March 2011.

27 Apart from the goods that have been moving across ASEAN countries, services can also be accessed with the Comprehensive Economic Cooperation Agreements (CECA) India has signed with Japan and ASEAN countries. Inaugurating an outreach session on Free Trade Agreements (FTA), organized by the Confederation of Indian Industry (CII) Kerala in Kochi recently, Mr A K Tripathy, Joint Secretary, Union Ministry of Commerce and Industry, said that India was currently looking at expanding trade and investment and services which had tremendous opportunities and potential in Korea, Japan, Singapore, Malaysia and other ASEAN countries that we could tap.

Mr Tripathy said that India has a $1 trillion aggressive services industry and that 50% of our GDP is trade- and industry-related. India played a very active role in signing the FTA and CECA with neighbouring countries, he said.

According to the FTA, there will be cooperation in the field of services such as pharmaceutical, nursing, teaching and IT. India can send and receive these services within the countries that have signed the agreement.

The other speakers for the session included Mr Avinash P Joshi, Director, Union Ministry of Commerce and Industry; Ms Suchismata Palai, Direc-

caregivers. About the much-debated India-Korea comprehensive Economic Partnership Agreement (CEPA) she said it covered not only trade in goods but also investments, services and bilateral cooperation in areas such as customs, audiovisual coproduction, competition, new and renewable energy etc.

'India can tap ASEAN’s services sector potential' tor, Ministry of Commerce and Industry; Ms Sonia Pant, Deputy Secretary, Trade Policy Department (Services); Mr A V George, Chairman, CII Zonal Council; and Mr T S Vishwanath, Member, CII International Policy Council and Principal Adviser, APJ-SLG Law Offices.

Mr Avinash Joshi spoke about the negotiating agreement between India and ASEAN on trade in services and investment which are targeted to be concluded by end 2012. He discussed the salient features of the IMCECATrade in goods, in which the major proposal was tariff reduction/elimination to be fast-tracked in three-six months.

“The CECA is to be a major factor in the robust growth in bilateral investments which have reached $24 billion and Singapore is now the second largest contributor of FDI into India,” he said.

Ms Suchismata Palai spoke about the Indo-Japan Economic Partnership and the relationship that the countries have been harbouring for a long time now.

Some of the major gains that have resulted out of the FTA include agreement to start and conclude negotiations for a Social Security Agreement (SSA) in three years and also for creating opening for Indian nurses and

Ms Sonia Pant said that India has a merchandise trade deficit of $130 billion and the remittance from NRIs/ PIOs is $53 billion. Thus the net export of services is extremely important for financing merchandise trade deficit and it is very critical that services agreements result in commercially meaningful market access for India’s service suppliers.

Mr Pranav Kumar, Director and Head, International Policy and Trade, said that the future of India’s service sector lay in promoting FTAs in the coming years and that International trade should be developed with ASEAN and other countries.

The objective of the session was to highlight the opportunities that will emerge for Indian industry from CECA. Many senior officials from the Ministry of Commerce and Industry were present and addressed as well as interacted with the members during the session.

CM invites investment Seeking big-ticket investments to propel its economic resurgence, Kerala the other day rolled out the red carpet for India Inc as well as corporate honchos and business tycoons from across the globe, promising them single-window clearance, lucrative returns and durable partnerships. “There are opportunities galore for investors from all parts of the world to invest in Kerala and ensure its sustainable economic growth,” Chief Minister Oommen Chandy told a high-profile gathering of corporate leaders and captains of industry in New Delhi.

‘Spirituality integral to management process’ “Management is the art of leading one’s own mind and intelligence and the minds and intelligence of others,” says Swami Bhoomananda Tirtha in reference to the element of spirituality that is present in all human endeavours.

The inspiration and guide of Delhi-based Foundation for Restoration of National Values (FRNV), the Swamiji recently delivered an hourlong lecture on ‘Spirituality—Its Relevance in Management Today’ at HLL Lifecare Limited’s facility in Peroorkada, Thiruvananthapuram.

Addressing an audience consisting of the executives and managers of the Mini-ratna public sector enterprise, the Swamiji emphasized the importance of nurturing the mind and intelligence—the two spiritual constituents of human personality—when taking on leadership roles.

“All managers should have an assimilative, resilient and flexible mind which enriches itself by imbibing inputs from their immediate surroundings and from the world at large,” the Swamiji said. “They should also apply intelligence—which is a refined form of the mind—

to rationalize, inquire, resolve problems and dissolve negativity.”

He was appreciative of the efforts of the large community of managers in India, whom he described as key contributors to the nation’s growth.

“Every manager should understand the societal dimension of their profession and pursuit.

No manager can afford to be lazy, negligent, inattentive or insincere, because their primary role is to elevate and empower society,” he said.

Interpersonal relationships, which pose the biggest challenge to a manager, are also the biggest test of their spirituality because it requires the application of both mental acuity and intellect, the Swamiji said.

He described the three elements that identify an efficient manager—elegance of character, behavioural majesty and interactional excellence.

Mr E Sreedharan, former Managing Director of Delhi Metro Rail Corporation and the national President of FRNV, was present at the talk, along with HLL Chairman and Managing Director M Ayyappan, who is also the Director of the Kerala chapter of FRNV. PASSLINE

Earlier in the day, Mr Chandy had emphatically stated at a meeting with top diplomats, heads of multilateral agencies and chiefs of trade missions, “Kerala is ready for investment. We want to send out a message to the world that investment is welcome.”

The two meetings during the day were part of the road shows the State Government has planned in connection with its ambitious ‘Emerging Kerala’ Global Connect, to be held at Kochi from September 12 to 14.

Mr Chandy, who was accompanied by his senior Cabinet colleagues and top bureaucrats, said his Government had listed out 12 priority areas for embracing investments from industrialists and businessmen—IT, IT-enabled services, tourism, healthcare, trade, retailing, logistics, food and agro-processing, gems and jewellery, ports and shibuilding.

Asserting that Emerging Kerala has been scheduled with the vision of an emerging, enterprising and equitable state, the Chief Minister said the event would provide an opportunity to showcase Kerala to global investors and seek investments from them for the state’s inclusive, rapid and sustainable economic development.

The meeting, organized by the Confederation of Indian Industry (CII), was attended by representatives of a number of top-notch companies from both the public and private sectors, including SAIL, DRDO, Petronet, Jubilant Energy, Medicity and Fortis.

The high-profile conclave also saw several companies from the SME (small and medium-scale enterprises) sector showing keen interest in setting up shop in Kerala in areas like renewable energy and IT. Kerala State Industrial Development Corporation (KSIDC) is the nodal agency for the Emerging Kerala campaign while CII and NASSCOM are the partners.

April 30-May 31, 2012

28

Adi Godrej is CII President, Kris President designate The Hygiene Shop Mr Adi Godrej, Chairman of the Godrej Group, one of India’s largest conglomerates, has been elected President of the Confederation of Indian Industry (CII) for 2012-13. He succeeds Mr B Muthuraman. Mr Godrej is a Master’s in Management from the Massachusetts Institute of Technology.

mentation and support of information systems for clients in the consumer products industry in the US. Between 1987 and 1994, Kris served as Vice-President for Technical Operations of KSA/Infosys, a joint venture between Infosys and KSA located in Atlanta, US. In 1994, he returned to India and was appointed Deputy Managing Director of Infosys.

man of The Business Action for Sustainable Development 2012 (BASD), a coalition of international business groups committed to sustainable development.

He is on the Board of Governors at the Indian Institute of Management (IIM), Bangalore. and Chairman of Indian Institute of Information Technology and Management (IIITM), Kerala.

Besides being Chairman of Godrej Industries Ltd, Godrej Consumer Products Ltd, Godrej Before becoming the Kris holds master’s Household Products CEO and Managing Direcdegrees in Physics Ltd, Godrej Properties tor in July 2007, Kris served and Computer Science Ltd, Godrej Hershey as Infosys’ Chief Operating from the Indian Institute Ltd, Keyline Brands Officer, President and Joint of Technology- MaLtd, UK, Rapidol Pty Managing Director, respondras.

Ltd, South Africa, Insible for customer services, Mr Ajay S Shriram, dian School of Busitechnology, investments Chairman and Senior ness and the Board of Adi Godrej and acquisitions. He took Kris Gopalakrishnan Managing Director of Trustees of the over as Executive Co-ChairDCM Shriram Consolidated Limited Dadabhai Naoroji Memorial Prize Fund, man on August 21, 2011.

(DSCL) and Chairman of its subsidiary he is also Director of numerous firms.

Recognized as a global business company, Shriram Bioseed Ventures Mr Godrej is the recipient of sev- and technology thought leader, Kris Ltd, has been elected Vice-President eral awards and recognitions including was recently voted the top CEO (IT of CII for 2012-2013. the Rajiv Gandhi Award 2002 and the Services category) in Institutional DSCL, based in India, is a comEntrepreneur of the Year for the Asia Investor’s inaugural ranking of Asia’s pany with a group turnover of about Rs Pacific Entrepreneurship Awards 2010; Top Executives and selected as one 5,000 crore. ($1 billion). It comprises Best Businessman of the Year for the of the winners of the Second Asian agri-, chlorovinyl and value-added busiGQ Men of the Year Awards 2010; Corporate Director Recognition Awards nesses.

Chemexcil’s Life Time Achievement by Corporate Governance Asia. He A Commerce graduate from Award 2010 and AIMA-J R D Tata Cor- was also selected to Thinkers 50, an Mumbai’s Sydenham College, Mr porate Leadership Award 2010. elite list of global business thinkers Shriram had attended various training Mr S Gopalakrishnan, also known compiled by Des Dearlove and Stuart and management development as Kris, Co-Founder and Executive Co- Crainer, in association with the IE Busiprogrammes in India and overseas and Chairman, Infosys Technologies Lim- ness School, Madrid, and the London participated in the Programme for Manited, is President Designate of CII for Business School’s Management Innoagement Development (PMD) at the vation Lab. 2012-13.

Harvard Business School, Boston, US. In January 2011, the Union Govern- He is actively involved in various indusMr Gopalakrishnan along with Mr N R Narayana Murthy and five others ment bestowed on Kris the Padma try associations and educational bodfounded Infosys in 1981. Kris served Bhushan, the country’s third highest ies and is the Chairman of the Governas Director (Technical) and his initial civilian honour. He has also represented ing Body of Shri Ram College of Comresponsibilities included the manage- Infosys and the country in many inter- merce (SRCC) and a Trustee of SOS ment of design, development, imple- national forums. Kris is also the Chair- Children Villages of India.

posts record profit Kerala Financial Corporation (KFC) has posted a 23.62% increase in net profit after tax at Rs 45 crore in fiscal 2011-12 from Rs 36.40 crore a year earlier. The corporation achieved this performance in spite of keeping its effective interest rate very low. While most of the other SFCs are charging interest at more than 16%, KFC is charging only 13%. The corporation achieved the target sanctioning loans for projects adhering to a time frame and simple methods and brought down the NPA below 7%. In addition to this, KFC has formulated a strict auditing system to ensure accuracy in loan sanctioning and disbursement. It appraised its projects by means of its own credit rating system. And only

those cases which get a set score according to the new credit rating norm will be eligible for 1% reduction and for a one-time settlement KFC has also seen improved performances in operational areas like disbursement and recovery of loans, collection of interest income and the reduction of non-performing assets (NPAs). It has become the first state financial company (SFC) with the highest reduction in non-performing assets (NPAs) among (SFCs).

The corporation, which has been optimizing its fund management and asset liability management through daily monitoring of funds, has improved its recovery procedures through e-sale to ensure transparency and eliminate

malpractices in auction of properties taken over from defaulting borrowers.

KFC anticipates distribution of 6% dividend this year. The State Government has a stake of more than 90% in the corporation’s share capital. The corporation can give about Rs 14 crore by way of dividend. Besodes this it has given Rs 40 crore to the Government by way of different taxes and the Government has gained about Rs 1,000 crore income from different units set up by way of loans from KFC. KFC has targeted sanctions of loans to the tune of Rs 600 crore and disbursements of Rs 500 crore in 201213. It also foresees interest income of Rs 200 crore in fiscal 2013.

Table shows the past performance of KFC Fiscal year

Loan sanctioned

Disbursal

Remittance

Interest income

Net profit

NPA

2007-08

247.57

186.43

218.44

84.66

-28.15

44.49

28.68

2008-09

349.10

293.94

269.25

91.04

11.70

21.00

13.22

2009-10

615.93

419.53

299.57

108.54

33.72

9.04

2.40

2010-11

507.06

4 43.44

354.73

131.84

36.40

8.20

1.88

2011-12*

539.02

464.68

469.30

173.98

45.00

7.00

1.50

*Provisional PASSLINE

April 30-May 31, 2012

Net NPA

For imported hygiene products

W ith every household looking for the very best in furnishings, bathroom concepts etc it was only a matter of time before the quest for excellence delved into cleaning supplies. The Hygiene Shop, a oneof-a-kind retail concept, is the brainchild of Renjith Koshy of the TransWare Group. A concept that has never before been previously experienced in India, The Hygiene Shop flagship store at Palarivattom in Kochi is all one needs to ensure a clean, safe environment at home, work or in public spaces.

The name says it all. The shop has deliberately used the word hygiene because it is necessary and is what cleanliness is ultimately all about.

Today, every need of a five-star hotel, or even a middle-class household for cleaning supplies and machines, is satisfied at The Hygiene Shop. Nowhere else will they get international cleaning products at reasonable Indian prices.

With a wide range of products from reputed suppliers across the UK and other European countries and the US, The Hygiene Shop primarily caters to that growing consumer group that is looking for quality imported hygiene products. Its wide range of innovative products include machines (vacuum cleaners, steam cleaners, floor disc machines), dispensers (paper, soap, wipes), paper and disposable products, janitorial systems (brooms, brushes, mops), matting and bins (stainless steel/ plastic), cleaning and industrial chemicals and non-woven and microfibre wipes.

Besides these, the shop houses a wide range of home aromatics created specifically to appeal in both design and fragrance. With oilbased home refresher oils, its fragrances are more pleasant and linger longer than the alcohol-based fragrances that are commonly available today. In addition to aromatics, it also stocks towels, tub mats and bathrobes.

The Hygiene Shop is unique in that it has a mock washroom concept so as to help customers better understand how the concept of cleanliness changes over time. With more innovative products and a personal hygiene line in the works, The Hygiene Shop promises to keep making the headlines.

With dream homes costing over half a crore of rupees, wouldn’t one want to maintain it accordingly?

Cleaning can be so much fun if one has the right equipment at hand. The Hygiene Shop ensures one’s cleaning moments are fun-filled rather than back-breaking so that one can sweep, dust, wipe, mop, rinse, wash, brush, blow, steam, sanitize, scrub and polish without any fuss and have clean, healthy days.

29 Passline News Service

"I

always love to be independent in my own ways”, says the proud and simple Shalini James of Mantra.

One can say that this modern attitude reflects in each and every piece of her work.

Mantra’s uniqueness can be seen in its apparel which makes the products different from other brands.

Handloom and khadi apparel is the signature of this shop.”No one uses khadi as a well-finished product. But by employing international standards, we can use it wisely as a style statement”, says Shalini.

When Shalini started ‘Mantra’ nine years ago, foresightedness in fashion and confidence were her only investment. But because of their innovativeness and style statements, Malayalees accepted her designs wholeheartedly. “Mantra’s second and third shops are my customers’ love”, beams Shalini.

The young lady politely corrects Mantra as a brand, not a boutique. Initially, it was a boutique. But now it is not. Mantra the design house now designs, manufactures and sells garments that appeal to modern yet traditional women of India. From a single piece of kurthi to a six-yard handloom saree, it bears the signature of Shalini, the one and only owner of Mantra.

Even from her childhood, little Shalini has loved the different shades and tints of colour around her. When she grew up, her dreams also grew up

S

with her. Her ardent love for colours helped her to explore the great and new possibilities of designing and painting.

This interest helped her to receive many prizes during her school days.

So, right since her graduation, the young designer has had no confusion. Her commitment to art and passion for fashion easily helped her to enter the magic world of the National Institute of Fashion Technology (NIFT), Chennai. According to her, NIFT is responsible for all her achievements.”The basics from NIFT helped me a lot. Of course the place helped me to bring a systematic approach to my work”, she says.

While speaking of Shalini, the adage “Business is in his or her blood” should be corrected to “Fashion in tune

with business is in her blood”. Her mother Sheela James opened Thiruvananthapuram’s first boutique in the late 1980s. During Shalini’s vacation, her mom used to give the task of supervising the workers at the shop to her and this helped her to mould her career as a businesswoman. During the days at NIFT, Shalini designed and fabricated apparel for her mother’s store. Though she was a designing student, she set up a small design house near her hostel with a few tai-

lors. This hardcore commitment and obsession helped her to become what she is today.

Her 12-year-old daughter Shreya too has a flair for designs and colours.

She is a good companion for Shalini during her long business trips. The mom-daughter duo enjoys these trips through little pranks and fun. Shalini’s normal trips are to Jaipur in Rajasthan as it is the best for handlooms and hand block prints. “I have many dedicated dealers there who provide me with the latest trends in handloom apparel.

And that is my greatest blessing”, says Shalini. Trying to maintain good rapport with all her colleagues and weavers across the country helps her to know about the minute details of

has two shops, one at Oberon Mall, Edappally, and the other at Gold Souk, Vytilla. A showroom of Mantra will be open soon at the Lulu Centre coming up at Edappally.

Shalini smiles when she is asked about the success mantra of Mantra.

“When I sit for designing, certain parameters come to my mind and I always work within those constraints”, she says. Of course knowing your customers or their tastes is the biggest and toughest task. Once you get the idea, you will succeed, she says.

She says Kochi has the most suitable air for business.”We don’t have many players. There is space for all,” she says.

apparel designing.

According to Shalini, the mall culture has contributed a lot to our society. It has made a drastic change in the mindset of the people. She affirms that she loves to work out her shops in malls. Shalini justifies the reason by saying that malls can be considered as the fashion centre of a city and these places can change the style sense of the people. Now she

Shalini James

FISAT—consistent excellence in professional education

ince its establishment in 2002 at Mookkannoor, the birthplace of the late K P Hormis, the visionary founder of Federal Bank, Federal Institute of Science And Technology (FISAT) has become become a ‘Centre of Excellence’ in professional education. It provides quality Engineering and Management education and has bagged numerous national-level recognitions. It had been selected in 2009, 2010 and 2011 for the national award for the Best Student Branch of the Computer Society of India. Professional bodies like ISTE, IEEE and ISA have also given national awards for Best Students’ Branches in the past.

gies. It has an indigenously built high-performance super-computing system, Dhakshina Cluster-II. The centre provides facilities for doing BTech, MTech and PhD projects for students in FISAT and other institutions.

Instrumentation Research and Consultancy Centre (IRACC): It is for promoting research in process instrumentation.

Centre for Research and Innovations in Signal Processing (CRISP): Signal processing techniques have come to occupy central place of importance in engineering and technology.

Community services: The institute has been carrying out outreach activities with students’ participation that enhance the quality of life. FISAT is the first institution which implemented the Tuition Fee Waiver Scheme in the State. Students with high academic results and hailing from economically backward families are granted full fee concession.

FISAT’s Placement and Training Cell (PTC) has a continuous college-industry interface. Its students are placed over MNCs like Microsoft, IBM, TCS, Infosys, Keane, Satyam, L&T, Wipro, CTS and IBS, Government and public sector companies like BARC, ONGC, Power Grid and Delhi Metro and commercial banks like Federal Bank and Bank of Baroda.

Centre for High Performance Computing (CHPC): An autonomous research centre, CHPC focuses on research and consultancy work in cluster computing using free and open source technolo-

Extracurricular activities: Numerous opportunities are given to students for development of extracurricular activities. There is an annual inter-class arts competition, ‘Arangu’, and the winners of these events represent the college in the university competitions.

In the sports arena, many national-, state- and university-level tournaments are conducted on its campus to provide exposure to the students and to promote budding sportspersons. Its teams have won many prizes in university- and state-level championships.

FISAT is a full-fledged academic centre with six BTech programmes: Electronics and Communication Engineering, Computer Science and Engineering, Electrical and Electronics Engineering, Electronics and Instrumentation Engineering, Mechanical Engineering and Civil Engineering. Other programmes offered are MTech in Communication Engineering, Computer Science & Information Systems, Power Electronics and Power Systems and MCA. FISAT Business School offers PG programme in Business Administration (MBA).

FISAT has so far established the following research centres:

seminars, workshops and conferences at FISAT to enhance the skill levels of students. In-plant training will be imparted to students in telecommunication areas of switching and transmission. Students can do projects and can take short-term training courses at the training centres of BSNL across the country.

Various student clubs aim to carry out community development programmes.

P V Mathew

FISAT-BSNL pact: FISAT has executed a Memorandum of Association (MOU) with BSNL to share knowledge resources and work together in research and development areas of telecommunication. Resources persons from BSNL l conduct technical PASSLINE

April 30-May 31, 2012

Management: Managed by Federal Bank Officers Association Educational Society, FISAT is superbly guided and supported by the dedicated team led by Mr P V Mathew, Chairman, Mr Anthony Johnson, Vice-Chairman and Ms P Anitha, Treasurer.

Dr K S M Panicker is the current Principal.

Spread over 40 acres of lush green campus, FISAT is an ISO 9001-2008-certified institution, approved by AICTE and affiliated to Mahatma Gandhi University.

HEALTH CARE

30 the usual custom. But my legacy, business in my blood, led me to a different, though related, area. But I have to stick on to my own discipline,” says Dr Navas. His father Usman is also a businessman with a wide network producing and distributing bakery items in Oman. “He is always my inspiration and I learned a lot from his experience,” says Dr Navas Medilife hi-tech laboratories: Medilife’s hi-tech laboratories are target-oriented. The group’s vision is to launch 100 such branches by 2015.The Medilife laboratory has worldclass equipment to meet the needs of patients. Says Dr Navas: “We believe in providing complete patient care along with good service. Our goal is not only to address the illness but also to concentrate on the overall wellness of the patients.” Medilife has two kinds of laboratories, those attached to the hospitals and those run privately to analyse samples from hospitals, general practitioners, insurance companies etc. Dr Navas expects a growth rate of 20% in the lab segment soon.

Medilife

Pharmaceuticals: Medilife Pharmaceuti-

1,000 students to our paramedical institutions and are likely to begin a university that can accommodate 10,000+ students. “Highly qualified and professional tutors work with us to raise a new generation of highly qualified paramedical technicians,” says Dr Navas.

The institutes are associated with Punjab Technical University. They provide degree and diploma courses in Microbiology, Biochemistry, MLT, Biotechnology and MBA in Hospital Management etc. The students are trained by high professionals who are eminent in the field. The institutes are set up with a mission to extend seamless access to sustainable and learner-centric quality education by using all innovative technologies.

Strawberry Kids, another division of Medilife Group, recently started its operation at Thrissur. Strawberry Kids, the concept pre-school, was born with the desire to nurture the child and lay a healthy foundation for a learned society. A fun-filled, interactive environment for children between 2 and 5 years of age, Strawberry Kids is a beginner setting for children to spend a few hours away from home and helps them pre-

Dr Navas Usman

Passline News Service

I

ndians, particularly Keralites, are considered intensely health-conscious compared to many other people. Today Kerala is noted for its high physical quality of life index. It is remarkable that this health status has been attained even while the state experiences a low standard of per capita income. It was these factors, together with the vast opportunities that the medical sphere provides, that induced Dr Navas Usman to start Medilife Healthcare Group.

Medilife Healthcare Group had its humble beginning in 2004 at the small town of Chavakkad, near Guruvayoor.

Now it is one of the most renowned medical organizations with ISO certification in the state. Recently the group started an office in Malaysia also for its international operations. Its vast business area spreads over educational services, hi-tech diagnostic centres/ laboratories, pharmaceutical and medi-

cal centres and now pre-schools also.

Since its inception the group has steadily grown, providing services to all the communities of the state. Thus Dr Navas’s vision to serve the unique needs of each client is bearing fruit.

Says Dr Navas, who is man and CEO of the group: “The health centres owned by Medilife provide the latest internationally recognized medical care to patients. Our centres are interconnected to a larger network of multispeciality medical units, which ensures patient access to expert care for any speciality.”

the Chair-

cals, yet another wing of the group, is a specialized distributor of high-quality allopathic medicines, laboratory reagents and medical apparatuses. Its accessibility spreads across the country and it caters to the needs of people or organizations from any part of the

Courses offered BSc MLT BSc Microbiology BSc Biotechnology Diploma in Dental Hygiene Diploma in Ophthalmology DMLT ECG ANM Nursing MBA in Hospital Management

Is it possible for a doctor to thrive as an entrepreneur? “Yes, of course,” says Dr Navas with a confident smile on his face. The young doctor got into the entrepreneurial arena in 2004 after completing his MD. “I should have started practice as a physician, as is

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country. “We promise the best quality and the best service”, says Dr Navas.

Educational institutes: The group’s first paramedical institute was established in 2008. Now it owns more than 10 educational institutions around the state. “We have admitted more than

April 30-May 31, 2012

pare to enter the portals of traditional education.

The group hopes to start medical institutes in almost every district in Kerala and also pan-India through franchisees. The basic requirement for such a project is a 2,000 -sq ft building to run the institute. Dr Navas welcomes franchisees who can meet the target and expresses his readiness to train them. Medilife Group is preparing for a vast and wide expansion move through franchise agreements.

Dr Navas and his wife Alfath have three children. The young entrepreneur is a football lover too and was an excellent athlete during his school days. He also worked as Medical Expert-Technical Head for an Austrian company called Quality Austria for ISO Audit. A winner of many awards in the past, he was the recipient of the ‘Subhash Chandra Bose Memorial Award’ in 2008 and the ‘Sri Chithira Thirunal Memorial Award’ in 2011 for his excellence in the medical industry.

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F

ried chicken! It has always appealed to our taste buds. The threegeneration-old T M K Group’s new restaurant ‘Barns Healthy Chicken’ provides a new tantalizing experience.

Launched years ago, Barns is the firstof-its-kind initiative in South India by the group’s well-established restaurant chain, ‘Embunan Suci sdn bhd’. The world-class service being provided by it for decades in Malaysia has made it unbeatable in the hotel industry there.

Barns provides an exiting range of delicious, spicy, mouth-watering chicken varieties. Hygienic preparation and minimal use of oil are the edges that Barns has got over the other fried chicken brands. Carefully selected ingredients and fresh chicken are used to prepare the spicy and crispy dish.

“Unlike other brands, Barns chicken is free from the fatal ajinomoto. We cook and serve healthy chicken. Our kitchen experts allow the pieces to marinate until the flavour reaches the bones and that makes it more spicy and peppery than that of others”, says Najeeb Challayil, CEO of Barns Fried Chicken.

The business group was started in Malaysia by Najeeb’s grandfather who had settled there. Later, the group flourished under the supervision of Najeeb’s father, T M K Mohamed. Today, the group is a well-established and unshakable business chain run by the five sons of Mohamed. The business empire sprawls across parts of India, Malaysia and the Middle East.

The T M K Group’s main investment areas are hotels, supermarkets and real estate. It was the seamless appreciation that Barns had gained abroad that encouraged them to spread its service to India as well.

“The success formula of Barns is its perfect blend of tempting taste and customer-centric hospitality. Presently, we own three Barns restaurants in Kerala and the fourth one will be opened soon at Kunnamkulam, Thrissur. Barns will also be coming soon at Kannur, Perinthalmanna and Thiruvanantha puram. “In Kerala our plan is to open Barns in almost all prime towns and we are also inviting franchisees,” says Najeeb. Barns is also getting ready to launch three centres in premier malls in Bangalore. Its Tamil Nadu entry will take place by opening centres at Trichy, Pondichery, Salem and Chennai. The outlets will be opened in six months’ time. Barns also plans to expand the venture to Hyderabad, soon after covering Tamil Nadu, and later to pan-India centres, the UAE, Singapore, Qatar and Saudi Arabia (Riyadh).

What is the factor that distinguishes Barns from others? “Our chicken is completely different from that of others. You will be having a new experience with our nutritional chicken item that is rich in vital elements. Barns

Najeeb Challayil

chicken is absolutely healthy as it is free from synthetic preservatives and added flavour and taste enhancers. We will soon be introducing our latest specialties, ‘oven-baked oilless chicken’.

It is prepared in such a way that it can be consumed by cholesterol patients too and that is its speciality. We care to serve healthy food varieties as we are in a society that is extremely health-conscious. We are keen to introduce varieties that can satisfy people from different geographical areas.” says Mohammed Shareef, Chairman of the group.

Barns chicken is perfectly baked using first-class ingredients and techniques, making it consistent in taste and quality at every centre across the globe. Constant innovations to meet the changing taste requirements, patent chicken varieties, better product price advantage and generations of experience are the assurance that Barns gives its customers in return for their trust and expectations.”We are committed to providing rich return to our customer’s investment,” says Jamaludheen, CFO. Barns’ high business potential makes it quite feasible for franchise models. For those who genuinely want to invest in the industry, Barns extends exciting franchise opportunities, one for a Casual Dining Restaurant that requires a 1,000-sq ft space and the other for a Quick Service Restaurant that needs a minimum of 300 sq ft of space. The total investment for the franchisees will be Rs 25 lakh to Rs 40 lakh.

Najeeb expects considerable business growth through the the franchise system. “We are looking for investors to build long-term networks upon mutual dependency, respect and trust.

Barns will always be happy to extend pre-opening and post-opening business support to the franchisees to maintain the supremacy of the brand,” he says.

Passion for excellent service and a PASSLINE

positive attitude towards hospitality service are the prime aspects that Barns looks for in potential investors.

Inspired by its success till now, the group is on the path of further growth.

The men behind this envious accomplishment are the five brothers—

April 30-May 31, 2012

Muhammed Shereef, Abu Backar, Jamaludheen, Nazarudheen and Najeeb. Barns is all set to grab the newer and newer possibilities in the food and beverages industry in Kerala.

Discover the chicken surprise from Barns Chicken!

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