Booming and Bubbling India-IX

Posted on July 9, 2007 by indra

While the enemies of the nation are getting emotionally involved in acts of terror, and that too on foreign land, India and Indians at home are trying to push the boom ahead in many fields in many ways.

Sensex makes history, hits 15k: India’s benchmark share index rose above 15,000 points for the first time on Friday. At 1:23 p.m. (0753 GMT), the 30-issue BSE index was up 0.75 percent, or 111.04 points, at 14,971.14, after rising as high as 15,007.22. And the investors with financial analysts and consultants are busy in predicting the rise by March 2008. A reporter finds the rise of sensex with Sachin’s 15K in one day matches.

For investors, India a shining destination: According to the Morgan Stanley Capital International (MSCI) Equity Indices, which compares the returns from various markets, India has given the annual return at 38.36% in the last five years as against the Chinese market, the largest emerging market in the world, that gave an annual return of 31.36% during the same period.

Indian Tech Revenue to Hit New Heights: The Indian technology sector will generate US$50 billion in revenues during the 2007 financial year, according to industry association Nasscom. Despite predictions that India’s tech bubble is about to burst, in terms of revenue, there is little sign of the industry slowing down. The Indian IT industry employs around 1.6 million software programmers, and contributed about 5.2% to India’s gross domestic product (GDP) in fiscal 2007

Top 10 IT majors’ exports cross $15 bn: TCS, Infosys and Wipro account for nearly $9 billion. The country’s IT software and services exports from the top-10 firms crossed $15 billion to touch Rs 68,236 crore in 2006-07.

Top 10 cos raise $3.1 billion through FCCBs: Ten Indian companies have raised a total of $3.1 billion through issue of foreign currency convertible bonds (FCCBs) in the first half of 2007, as per the financial data released by Bloomberg. The total volume of FCCBs issue is $4.8 billion.

India Too Rich for Some European Telcos: France Telecom’s CEO commented on the price of India’s telecoms companies. While France Telecom still had the option to enter India, its choice of acquisition targets was currently restricted to smaller and cheaper companies.

Kalam’s dream to come alive: Barely two weeks before he demits office, the government on Thursday fulfilled a dream of President APJ Abdul Kalam by approving a pan-African e-network project proposed by him to bridge the digital divide in that continent. India will set up an Rs 542.90 crore project to link 53 countries of the African Union (AU).

World`s study material just a few clicks away: Around 800,000 students from 1,000 colleges and educational institutions in India – including the Indian Institutes of Technology (IITs) and Indian Institutes of Management (IIMs) – will be able to connect with the world’s best online study material, research laboratories and faculty members by March 2008.

Tele-treatment on its move: Srishti Software, a Bangalore-based company in the Healthcare Information Management System (HIMS) space, has implemented the Picture Archiving and Communication System (PACS) with high-definition television (HDTV) production facility in the President Estate Clinic, the family wing of Rashtrapati Bhawan. The facility is used for addressing the nation, tele-conferencing, and providing tele-education and tele-medicine services.

India to join ITER to boost nuclear fusion technology: India on 6 July decided to join the International Thermonuclear Experimental Reactor (ITER) project at an estimated cost of Rs 2500 crore. India’s participation in ITER would allow the country to “leapfrog in terms of our national technological capability in fusion energy“, the seventh member of an elite group of nations like China, European Union, United States, Japan, South Korea and Russia.

Japanese majors to invest $10 bn: Twenty-two Japanese companies including giants like Suzuki, Honda, Sony, Matsushita, Mitsubishi among others today committed investments worth $10 billion into India. The investments are expected to happen in the Delhi-Mumbai Industrial corridor. Japanese financial services major Nomura will buy 35% in Enam Financial Consultants valued at about Rs 4,200 crore (a little over $1 billion), for Rs 1,400 crore. It’s a confidence shown in the Indian enterprises.

India ahead of China in raising syndicated loans: According to data complied by global consulting firm, Dealogic, Indian companies account for 10.5% of the total syndicated loans by BRIC nations, with borrowings of about $8.28 billion in 2007 so far, higher than China’s 7.9% or over $6 billion.

Infosys selected as best outsourcing partner: Infosys Technologies Ltd was selected as ‘Best Outsourcing Partner´ by readers of ‘Waters´, a leading publication covering the needs of Chief Information Officers in today’s global capital market firms. Waters ranking recognises the outstanding achievements of solution providers that help financial institutions generate revenue and service their clients efficiently. Infosys was named the ‘Best Outsourcing Partner’ over nine competitors and by a margin of more than double that of the closest competitor in the survey.

Cognizant to hire 7,700 in India: Cognizant Technology Solutions Corp plans to spend Rs 1.88 billion (USD 46 million) building a new facility in India and also hire 7,700 employees, the head of its Indian unit said on Tuesday.

Animation industry to create upto 3 lakh jobs: According to a survey carried out by Assocham on “Will animation industry emerge as the next knowledge destination for jobs”, the findings revealed that the parks could alone generate employment opportunities for two lakh skilled animators within the next three years and a business worth $1billion (Rs 4,000 crore) by 2010, with a CAGR of 30%.

Pvt security firms to create 10m jobs: According to Central Association of Private Security Industry (CAPSI), annual turnover of the segment has touched Rs 22,000 crore last year and is growing at a rate of 25-30% growth per annum, and is poised to employ over 10 million in the next 5 years. Interestingly, the segment is providing job opportunity to people of below poverty line; most of them are from villages and doesn’t have any skill. It is certainly not a jobless growth.

Nokia Siemens to invest $100mn in India: Nokia Siemens Networks today announced its plans to invest $100 million (Rs 410 crore) in the country over the next three years as a part of its commitment to develop a strong telecommunications environment in India including a telecommunication equipment manufacturing facility in Tamil Nadu for wireless network equipment.

Premji among top 30 world entrepreneurs: Azim Premji and Bangladesh’s micro-credit leader and Nobel Prize winner Mohammad Yunus are among the all-time top 30 entrepreneurs, identified by leading business magazine Business Week.

Wipro to acquire Unza Holding: Wipro Ltd, with interests in software, consumer products and energy, would buy Singapore consumer goods company Unza Holdings Ltd for Rs1,010 crore in its biggest acquisition ever that gives Wipro market access in Vietnam, Hong Kong, China, Indonesia and Malaysia, where Unza has its own operations, and factories as also manufacturing bases to source soaps and toiletries from at a lower cost for the Indian market.

Welspun-Gujarat to build manufacturing unit in US: Metal pipe manufacturer Welspun-Gujarat Stahl Rohren is planning to build a $100 million manufacturing facility at Arkansas in US and expects to start production by spring of 2008 with a capacity of 3,00,000 net tonnes of tubular steel pipes annually for use in the oil and gas industry, and would hire about 300 workers.

Patni Computer acquires European telecom consulting company: Software services provider Patni Computer Systems Ltd has acquired European telecommunications consulting services company, Logan-Orviss International (LOI), for an undisclosed amount.

Accentia Tech to acquire two US firms: Accentia Technologies Ltd has signed agreements to acquire U.S-based G.S.R. Physicians Billing Service Inc. and GSR Systems Inc. that would add $2.5 million to its revenues in 2007.

Spentex acquires Czech firm: Country’s largest yarn manufacturer Spentex has acquired Schoeller Litvinov k.s. in Czech Republic for $25 million that would give the company a footprint in Czech Republic, Germany, France, Belgium, Netherlands and Luxemburg with an access to a large customer base in over 30 countries, adding an annual volume of about 19,000 tonnes.
Textile design and manufacturing company Himatsingka Seide has acquired 80% stake in US-based bed linen products distributor Divatex Home Fashions, Inc, for $53 million (around Rs 215 crore). In February, the company had acquired Italy-based Giuseppe Bellora Spa and is looking to strengthen the Bellora brand in Italy and the US

Bharti Airtel, the largest GSM- based cellular player, awarded to Nokia Siemens Networks a $900 million contract for expansion of its mobile, fixed lines and next generation network.

Delhi-Mumbai corridor to attract $90 bn: The proposed industrial corridor is 1,483-km-long and 300-km-wide and will have the Delhi-Mumbai railway freight corridor at the centre. The $90-billion, 1,483-km dedicated freight corridor coming up with Japanese help is to pass through six states-Maharashtra, Gujarat, Rajasthan, Haryana, Uttar Pradesh and Delhi, hardly touching Madhya Pradesh.

Growth in passenger car production: According to the International Organisation of Automobile Manufacturers (OICA), India posted a growth of 16.5 per cent in 2006 compared with 7 per cent in 2005.In absolute terms, India, with a production of 14.73 lakh cars, moved up one place to the seventh position in 2006 replacing the UK, which produced a total of 14.42 lakh cars, recording a drop of 9.7 per cent from the previous year. India manufactured 14.73 lakh cars growing at 16.5 per cent.

Calcutta-educated, Indian-American scientist solves a quarter-century-old riddle: Sankar Chatterjee, curator of paleontology at the Museum of Texas Tech University in the US, has determined just how a bird that weighed around 70 kg and stood 3.5 metres from beak to tail with a wing span of 7 metres could actually fly.

And finally, Taj is selected among the seven wonders. It is again a result of booming India, and its younger generation’s strength, as the win has come through SMSs and e-mails, 100 million in number. India’s story of telecom sector is unique for those who have first hand experience. It has now 200 million plus subscribers. It is a rightful place for this wonderful creation.

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Strangely Americans Work without Holidays

Posted on July 8, 2007 by indra

Even with my three sons and their wives working in US, I did not know that in US, an employee does not get any mandatory annual holidays with full pay.

According to the report, compiled by the Washington-based Centre for Economic Policy Research, the US is the only country where employees have no statutory leave, and they get about half as much time off in reality as Europeans get. “The United States is in a class of its own,” the report says. “It is the no-vacation nation.”

A report published by the European Trade Union Institute provides an international snapshot of how much paid leave people get by law and in practice in 21 countries.

Finland, followed by France, offers working people the most statutory vacation, at more than six weeks per year. Canada and Japan require employers to give at least 10 days paid leave to their staff. The Europeans get at least four weeks by law and often much more in practice.

India appears to be much better in this respect. Even in our own days, we used to get one month PL (privileged leave) and 15 days of SL (sick leave) every year all paid. We could accumulate them for years. Many a times, we could encash them too. And at the time of retirement, I got a cheque for the holidays not availed. Were we not lucky? I am sure the norms would have continued in manufacturing sector, if not in IT about which I don’t have much information. However, I could never enjoy my holidays in real sense, and that may be true for many other Indians too. But in my case, I was myself responsible for that. Here is my story.

In the first five years of my job at Hindustan Motors (HM), I remember to have taken to two short holidays to visit my village home. The occasions were the marriage of the cousin sister of my father, and then the death of my grandfather. When Yamuna joined me at HM, we went on a long leave to Bodarhi, my mother’s village where she used to live in December 1966. That was the time when I went for a volunteer work with Jai Prakash Narayan’s Bihar Draught Relief Association for almost 20 days and worked with some Peace Corps members from Australia and US in Noorsarai (Biharsarif). That was the time when I visited Patna, Nalanda and Rajgrih for the first time while returning from Noorsarai.Thereafter, we visited Bodarhi number of times to fulfill the wishes of my mother. We built a country house there according to our test. I had to work hard for that and go there many a times. It was outside the village with a good courtyard with number of mango and other fruit trees. Then the whole family visited Bodarhi to have the religious function when the house was complete. That was the time when our car fell far deep into the ditch near Asansol. We escaped any major injury. The Ambassador car was damaged, but we traveled in the same car for about 450 kms to reach home the next day. I still remember my father waited for us for the first time. When we didn’t reach in time, he returned. We took the car right up to Bodarhi in the same condition. It was a weeklong religious function worshipping Shiva. On the final day, as usual there was a big party in which all the people of the village and my relatives participated. I had gone door to door to invite them.

Unfortunately, I got busy thereafter in factory. It was a madness of mine to prove myself extraordinary. I hardly availed my holidays but for once when we went for a week or so for a trip to Orissa- Bhuvaneswar,(Udaigiri, Khandagiri) Konark, and Puri. The family still remembers those wonderful days.

However the statutory holidays got accumulated and helped me many times in many ways. When I went to England in 1982 with my wife, we took a long holiday. Besides my official work at Cam Gear in Cardiff, and Vauxhall Motors in Luton, we stayed for a week or more in Birmingham and visited a number of factories including Jaguar and the Motor show going on there at that time. I got the accumulated leave encashed too once when I was building my house at Salt Lake. In those days, the task of construction of a house was a difficult project as there were no cheap loans available, neither was there any tax rebate on house loans, as it is possible today.

I still wonder why American workers have not got these statutory holidays. I think it may be happening in individual contracts that an employee signs with his employer. However, I am sure Americans enjoy holidays regularly and better. I would love if someone let me know more about it.

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Doubtful China’s Quality

Posted on July 6, 2007 by indra

I have been writing about the quality of the Chinese products for long. When I was in US, my children used to joke that whenever I was in any shopping center I kept on moving around looking at the tags for the country of origin. I found, over the period because of intensive consumerism Americans hardly bother about the quality of household goods. Americans buy without any reservation about its quality. American housewives keep on stuffing their house with clothing, toys, and other decorative items mostly manufactured from China. The Chinese goods are certainly cheap, but very poor in quality in most of the cases. During my short stay itself I found many instances of its poor quality. That was the reason that I couldn’t dare to buy a Haier air conditioner though it was cheaper. I bought a Samsung one, as Hitachi was too costly. Perhaps the Chinese manufacture with a ‘throwaway’ concept- use once and discard. Technically speaking, the Chinese perhaps have not been able to build quality in the manufacturing processes. And with so huge a scale, the quality can’t be inspected that they try to maintain quality.

Quality in many cases demands perception about the damage its deviation from the target can do to the consumers and society. That was the principle of Taguchi’s Quality Loss Function. The whole lot of quality tools and techniques- from zero defect to six sigma, from statistical quality control to total quality management and then Quality Function Deployment– evolved first in US and then in Japan to produce the quality first and in all coming out of the mass production lines. The people from the top management to the first line operators must believe that quality can neither be compromised nor inspected. For making easy money, many short cuts may be alluring but the 100% quality assurance is tough task, and must get into the national culture.

Unfortunately, the unscrupulous traders from India are taking advantage of the free trade and globalisation, and even the government machinery that controls import aids them I unscrupulous practices. The traders buy all the poor quality products of all kinds, sometimes even those rejected by the western customers, at throwaway prices. Taking advantage of the ignorance of the Indian consumers, they market it in all corners of India making huge profits. It will be prudent for everyone to avoid buying Chinese unless the quality is assured.

Yesterday I came across two reports- one in ‘Economists’ and second in ‘New York Times’. I could never believe that Chinese were exporting s much of food and drugs too to US. The reports talk of the shoddy rather dangerous quality of the Chinese stuffs.

In the latest Economist there is a report on the Chinese manufacturing, ‘The diddle kingdom’:

“In May the head of the agency that regulates Chinese food and drugs, Zheng Xiaoyu, was sentenced to death for accepting bribes in exchange for licences to produce fake drugs and medical devices. And this week a report from the General Administration of Quality Supervision, Inspection and Quarantine, China’s standards watchdog, said that 20% of domestic products tested had failed to meet safety standards.”

“On July 1st Charles Schumer, an American senator, issued a report noting that 60% of goods recalled by America’s main safety regulator came from China. In June alone, the report says, dangerous faults or poisons prompted the recall of 68,000 folding chairs, 2,300 toy barbecue grills, 1.2m space heaters, 5,300 earrings, 1.5m “Thomas the Tank Engine” toy trains and 19,000 children’s necklaces. America’s Food and Drug Administration has also rejected several shipments of contaminated food from China this year, and a wholesaler in New Jersey has recalled Chinese chocolates containing potentially carcinogenic ingredients.”

The NewYork Times has another article ‘China Finds Poor Quality on Its Store Shelves’ By DAVID BARBOZA.

“China said on Wednesday that nearly a fifth of the food and consumer products that it checked in a nationwide survey this year were found to be substandard or tainted, underscoring the risk faced by its own consumers even as the country’s exports come under greater scrutiny overseas.”
“The government said, for instance, that canned and preserved fruit and dried fish contained excessive bacteria; that 20 percent of the fruit and vegetable juice surveyed was deemed substandard, and that some children’s products were defective or laced with harmful chemicals.”

However, US manufacturers can’t give up its preference for the Chinese friends to have the short-term profit even after the doubts about the quality. The latest news comes from Chrysler, one of three biggies of yester years’ US automobile industry. “The Chrysler Group signed a deal with China’s biggest automaker, Chery Automobile, for a production venture that could export the first Chinese-made cars to the United States. The alliance offers Chery, a 10-year-old company based in the eastern Chinese city of Wuhu, an opportunity to realize its longtime ambition of entering the American market. Chinese automakers already export low-price trucks and buses to Africa and other developing markets. But analysts say the automakers lack the technology to meet American and European safety and pollution standards on their own.”

It appears that the days of ‘Made in America’ are dead.

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Noida- Unscrupulous by Nature

Posted on July 5, 2007 by indra

On a relaxed Sunday a month and half ago, I returned home after my morning walk. My wife informed that someone had come and asked me to attend a meeting of the Block A residents in Park at 6.30 PM. Since last year, I avoid these meetings, as I find them as useless. But in evening my advocate friend, YP Singh perhaps wanted a company and so dropped in to take me to the meeting. As usual, it took more than an hour that some 20-25 residents got collected. The meeting started. After the latest change in the constitution of RWA regarding the election of executives, the block didn’t get any representative. The President of RWA has agreed to get a person from the Block nominated. The meeting was called to select a person to represent the Block A so that the problems of the block could be taken up in the meeting of the RWA (Residents Welfare Association).

Surprisingly, even after my showing hesitation, all the residents present in the meeting unanimously selected me to represent them. I asked the organizer of the meeting to send the minutes of the meeting with this decision and the signature of the attendees to the President. I can only consider myself a representative if the President invites me based on the will of the people of the block. As informed, it was done in the following week. Once in between someone stopped me while I was coming back from my walk and asked if I have withdrawn my name as representative. I denied.

Today in the morning I found the latest newsletter from the RWA President giving a number of information. The newsletter also had names of Block representatives. But the representative of our block was Chopra. Chopra was the gentle man who most vocally went for my name on that Sunday meeting. He didn’t think it his duty to inform me about the development himself that he could have done. I would not have called him unscrupulous.

Perhaps, the builder President of the RWA feels more comfortable with a builder to represent our block instead of an IITian with 42 years of experience as senior executive with many ideas that can help the sector. Is it a usual case of inferiority complex in leaders who prefer to work with sycophants?

However, my interest to be representative was to take up certain issues that are dear to me, may be to many other residents too, officially with the executives of RWA and Noida Authority:

Monthly subscription and cable rental: As for many retired residents the finance is constraint, RWA must explore all possibilities to cut down the subscription (Rs 150 per month) as well as the high rental of the cable operators (Rs 310 per month).

Library: An enthusiast resident, Sanjay Sehgal has discovered the library plot in the sector and is trying to help building the library. The story got published in ‘Sambad’ as well as ‘Noida Plus’ of TOI. RWA must pursue it honestly and earnestly. It can get the sector an important landmark.

Integration of Agahpur village: Instead of looking down upon the villagers and creating the strong dividing wall, the RWA must take all possible initiative for its inclusive growth and integrating it with the sector.

Web of the sector: It was nice to read the last President’s newsletter that has already a mention of that. It must come fast. It must be interactive to solve residents’ problems and provide the transparency of accounts of the RWA.

Playground for children: It is unfortunate that the master plan of the Noida Authority doesn’t take care of this very important need of the community. But it is possible even now. RWA must take it up to create as some playground in the different blocks as it is possible on the vacant plots.

An aesthetically designed boundary wall: that provides safety of the residents without appearing as an eyesore.

Better involvement of residents particularly at block levels as the sector is too big to have a desirable level of fellowship.

Will it happen? I am sure it will. And my friends in executive committee will take it up seriously.

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Innovation -The Only Winning Way for Manufacturing Sector

Posted on July 5, 2007 by indra

I am quoting below (in Box) a story by Matthew May, a former senior advisor to Toyota University, the author of The Elegant Solution: Toyota’s Formula for Mastering Innovation, and the director of the innovation firm Aevitas. It appears in one article in Strategy-Business, ‘Innovation Agility’. Every one in manufacturing sector must make it a point to go through it.

China and India are having healthy competition to win the world market. China after shadowing the global manufacturing supremacy is trying to get into and capture the automobile sector too. As on today, the Japanese are at the helm in auto sector with some of European automakers. Toyota has become now the largest automobile producer of the world leaving behind the reigning supremo, General Motors.

Indian manufacturing sector too has gone for total revival in last few years. Its auto sector with Tata Motors and M&M as major Indian players, is trying to come in the race. While in volume production, the Chinese are far ahead, many feel the Indian manufacturing sector has followed and assimilated Japanese system of manufacturing better. Indian manufacturers are not copycats, and simultaneously more robust and quality-biased. India is in better position to provide quality products to the global market. Indian players must make the Toyota as its benchmark for its strategy about innovation that can win them the competition.

No one at Toyota was shocked when company president Katsuaki Watanabe announced to Wall Street and the rest of the world in the latter part of 2005 that he had ordered his research chief, Masatami Takimoto, to find a way to cut in half the price difference between Toyota’s hybrid cars and similar gasoline models without compromising any of the current quality standards, features, or performance. Watanabe’s comment: “I assume Mr. Takimoto must be racking his brains about how to do that.”

Toyota has for decades strategically set ambitious objectives in just this way – deliberately pitting seemingly incompatible goals against each other. Why? Because these competing targets cannot all be met without innovative thinking. The artful setting of opposing “stretch goals” builds a creative tension that fuels innovation by requiring a harmonious resolution.

For example, when Lexus Chief Engineer Ichiro Suzuki announced in 1987 that the secret vehicle under development for the U.S. luxury market must best, not match, the iconic BMW 735i in every rated performance category – speed, weight, styling, acceleration, noise, handling, comfort, and fuel efficiency. The army of more than 5,000 designers, engineers, and technicians reacted unanimously: impossible! Greater speed and acceleration conflicted directly with fuel efficiency, noise, and weight, because higher speed and acceleration required a more powerful engine, which in turn is bigger and heavier, thus making more noise and consuming more fuel. A smooth, quiet ride (associated with heavier weight) conflicted directly with better handling at high speed. And at the time, luxury styling didn’t have today’s streamlined look, so refinement and high-speed stability conflicted directly with aerodynamic drag. In short, the targets were thought to be individually attainable, but collectively unachievable.

Yet when the Lexus LS400 made its debut in 1989, it was five decibels quieter, 120 pounds lighter, and 17 miles per hour faster (according to Car and Driver) than its designated rival. It also got four-plus more miles to the gallon, and had better handling, acceleration, and comfort, while retailing for $30,000 less. Suzuki’s willingness to maintain tension among various competing targets, combined with his refusal to compromise, had made a difference.

Similarly, when Toyota began to develop a futuristic gas-electric hybrid vehicle in the early 1990s, senior leaders employed a new and unique internal design strategy: Pit Toyota’s various design centers against one another in a competition for the best design. The winner, as judged by a panel, would be awarded the project. That winner, the Prius, eventually made its production debut at the 1997 Kyoto conference on global warming.

The strategy proved so successful in generating an innovative product that today Toyota’s three major design facilities – located in Tokyo; Newport Beach, Calif. (near Los Angeles); and Brussels – compete to design every new model. Kevin Hunter, who currently heads the Newport Beach-based design studio, a subsidiary called Calty Design Research Inc., confirms the value of the competition: “It sets up a competitive edge. There’s much more of an intense focus and awareness when you know that nothing is being handed to you, that you have to win the business. You have to do your most excellent work. You have no choice: You have to deliver a perfect proposal.”

This stretch goal approach contains its own inherent challenges. Toyota is now developing ways to balance its stretch goal system with its own deliberate and distinctive quality consciousness.
When I read this story, I was reminded of Ratan Tata directive to the designers of ‘Indica car’- a car as roomy and sturdy as Ambassador, and as fuel efficient and cheap as Maruti 800. And they made it happen. Even some of the initial problems were also handled very smartly. Tata Motors are trying to do that again with Rs 1-lakh car after successfully launching its wonderful mini-truck ACE.

Can others in manufacturing sector emulate the Toyota methods to repeat Tata Motors success story with their product innovations?

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Power – Is there a remedy?

Posted on July 4, 2007 by indra

It was 80s. Hindustan Motors (HM) was in better shape. It was coming out with new projects at Pithampur (MP) and Halol (Vadodara). It was trying to push up the production at its parent plant at Uttarpara (Kolkata). But power was the main constraint. It had to make a major investment to install standby power generators for about 20MW. Even at that time it was an unnecessary investment to cover up the failure of the government policy that had kept all power plants in public sector.

The condition of power in West Bengal improved thereafter, perhaps as the requirement reduced because of the closures of many factories due to aggressive unionism. But even today after 30 years, the situation of power has not much changed. In Noida or for that matter in every township of the country, the power situation is one of the major irritants holding people to improve the quality of life.

As reported, the peak hour demand for India is 100715 MW. 86818 MW is met by its generation. Gap is thus 13897 MW i.e. 14%. India has succeeded in reducing just one percentage point of the peak shortage since 1991.

Majority of generation projects are with public sectors. It never gets completed in the scheduled time. Last three Five-year plans (VIII, IX, and X) saw only half of the targeted additions to generation capacity attained.China adds generation capacity of 70000 MW every year. India added 21180 MW IN THE LAST FIVE YEARS. Bihar has not even added 1MW in the last 10 years.

Aggregate technical and commercial (AT&C) losses in states such as Bihar, Maharashtra and Madhya Pradesh amounted to over 50% in. In monetary term, AT&C losses cost Rs 47,000 crore a year that could add 47 IITs every year in India. The amount is equivalent to the UPA’s allocation to poverty alleviation last year. 27% of the electricity produced goes to vote banks in the farm sector free and get to a great extent wasted. If the farmers of Punjab and Tamil Nadu can get it free, why should others not? Governments have the diagnosis right for many years but ducks in providing remedies.

But the country is still growing at the rate of 9% plus with manufacturing touching even 15%. Is it not interesting? Here is one data from the cement industry that is highly power-intensive sector. Cement manufacturers had to go for cost reduction to contain the government pressure to hold he price. It went for captive power, as it provides an alternative to reduce this cost component.

As reported, “on an average, states charge Rs 4-5 per unit, where as, captive power costs between Rs 1.50 to Rs 2.50 per unit, thereby bringing a straight benefit of Rs 2.50 to Rs 3 per unit. Depending on the process (dry and wet), production of one tonne of cement requires 110 to 125 units. This means, if power is sourced from a captive plant, manufacturing one tonne of cement will bring the power cost down by half, from Rs 540 per tonne to Rs 270 per tonne.” According to the Cement Manufacturers Association (CMA) “For maintaining profitability, we are taking measures to ensure better cost efficiency. We have now 100 per cent captive power which reduces our costs.”

Is it to be doubted?

Unfortunately, the private sector has not come in big way to solve this major problem that is holding the country’s growth as well as the quality of life of ‘aam aadami’. Private sector’s share in power generation is only 12.9%. I fail to understand why the associations such as CII are not able to convince the bigger players in industry to go for it as priority, as after all it can never be a losing business with billion plus consumers and entrepreneurs bribing and waiting to get power sanction. I do also can’t digest the lack of initiatives from the town government. Why can’t Noida and many such townships that earn thousands of crore auctioning their land in booming real estate market invest on having the power generation of its own?

Many a times, I wonder should I (at 68) not get satisfied with the many heartening announcements such as ‘The Ministry of Renewable Energy plans to achieve 80,000 MW of electricity generation through renewable sources by 2032′, L&T going to manufacture electrical power equipment’, ‘Seven mega power projects to come’ and ‘Electricity for all by 2012‘, appearing day after day in media.

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Booming and Bubbling India-VIII

Posted on July 2, 2007 by indra

India will be 60, next month. The entrepreneuring Indians are making news every now and then. The news excites younger generation to have big dreams. And these dreams are pushing the country towards the status of a developed nation.

Today’s rumour may be reality tomorrow: The shares of both Infosys Technologies and Capgemini SA jumped on rumors of India’s IT bellwether acquiring Europe’s largest IT services firm.

India’s chipping in: A leading US-based analyst firm, iSuppli – in a forthcoming report – has pointed out that the integrated circuit design industry will quadruple in revenues from $596 million last year to $2.1 billion by 2010. The report also suggests that within the next three to four years, India will end up doing half the world’s chip design. The story such as one on Mithilesh Jha is clear indicator.

India Rides the VC Wave: As reported in Business week, U.S. venture capital firms are broadening their scope and investing in Indian companies that are helping the country’s poor. Two California VC funds-Walden International and New Enterprise Associates-are considering a $5 million investment in Novatium, a Chennai-based company that has developed a $100 personal computer.

India emerging as third largest banking hub: According to a PricewaterhouseCoopers report, the domestic credit in India would grow to $23 trillion in 2050 from $0.4 trillion in 2004. India is pegged to take the third place as a banking hub after China and the US by 2040.

Faster Urbanisation in India: The urbanisation of India is taking place at a faster rate than in the rest of the world. By 2030, 40.76 per cent of India’s population will be living in urban areas compared to about 28.4 per cent now, according to the United Nations’ ‘State of the World Population 2007’ report.

Indian millionaires: The number of high net worth individuals (HNWI), with a net asset of at least $1 million, increased by 20.5% to 1,00,015 in India last year, second only after 21.2% growth in Singapore, according to the World Wealth Report released by Merrill Lynch and Cap Gemini on June 28,2007.

Red tape smaller problem for India Inc: According to an International Business Report (IBR) by global accounting and consulting firm Grant Thornton International, India seems to have fared much better, with just 37% of the businesses surveyed blaming bureaucratic delays for their woes. That’s a tad lower than the global average of 38%, and way below Brazil’s 60% and Russia’s 59%. Further, only 23% of Indian businesses consider cost of finance to be a significant constraint as against Russia at 40%, Brazil at 36% and China at 35%. The numbers on working capital being a significant constraint to growth are very similar.

India second largest investor in UK: India has been rated as the second largest foreign investor in the UK by consultancy firm Ernst and Young, acknowledging India Inc’s growing competitiveness and willingness to take up global challenges.

Indian M&As to top $100 bn: India Inc is getting bigger by the day in terms of mergers and acquisitions (M&As). Driven by large capital and global liquidity, the M&As, including inbound and outbound deals, are expected to cross the $100-billion figure in calendar 2007, according to leading investment bankers.

4 Indian majors in ‘IT 100’: Indian majors like Bharti Airtel, TCS, Infosys and Satyam Technologies have found place in the Information Technology 100, BusinessWeek’s ranking of the top tech performers in the world. TCS has also been named as the only Indian entity to be listed among the world’s top 10 most profitable firms.

Arun appointed on Biz Council for Britain: NRI entrepreneur and Vodafone CEO Arun Sarin has been appointed as a member of the Business Council for Britain, a high powered body comprising representatives of UK-based businesses by the new Prime Minister Gordon Brown to advise him on issues that affect enterprise, business and competitiveness of the economy.

India-born scientist excels: Indian-born Australian Kuldip Sidhu has won the “2007 Top Invention Prize” for his work on stem cell research that, he says, is of “great relevance for India”.

An Indian as future Nobel candidate: Avinash Kamalakar Dixit, the Princeton professor is one of a trio of Indians who stand on the highest peak of academic economics. Amartya Sen is already a Nobel lauret. The names of the other two-Jagdish Bhagwati and Dixit-are inevitably tossed in the air when the new Nobel season starts every year.

Mukesh Ambani to get ‘Global Vision’ award: The US-India Business Council (USIBC) will confer the ‘Global Vision’ 2007 award for leadership on Reliance Industries Ltd (RIL) Chairman Mukesh Ambani in Washington.

A scientist at IIT-Kharagpur has patented a technique to harvest hydrogen from a commonly found strain of bacteria, providing a possible alternative to current hydrogen extraction techniques, which are expensive.

Tata Power has completed acquisition of 30% stakes in Indonesian thermal coal producers – PT Kaltim Prima Coal (KPC) and PT Arutmin Indonesia, and other related coal trading companies owned by PT Bumi Resources Tbk for a consideration of $1.1 billion.

Carlos Ghosn, head of Japan’s Nissan Motor and France’s Renault, said in Bangkok on Wednesday India’s Mahindra would be the “natural” partner if the company decides to produce a $3,000 car there. “If it’s possible to be done, it will be done in India.”

US firm, TN govt ink pact to set up tech campus near Chennai: US electronics manufacturing services (EMS) company, Samnina-SCI Corp., has entered into an agreement with the government of Tamil Nadu to set up a manufacturing technology campus in India at Orgadam, near Chennai that will offer solutions to original equipment manufacturers (OEMs) in the medical, communication, automotive, multimedia, defence and aerospace sectors.

According to managing director and chief executive Heung Soo Lheem, Hyundai Motor India Ltd (HMIL) is India’s largest exporter of fully built passenger vehicles and a manufacturing base for all the parent’s small cars worldwide.

Daimler to assemble trucks in India soon: DaimlerChrysler plans to assemble Mercedes-Benz trucks in India soon, to tap the growing demand to transport freight in Asia’s third-largest economy.

TCS to provide software for Ferrari’s F1 cars: Software major Tata Consultancy Services (TCS) has entered into an agreement with Scuderia Ferrari to provide entire software to the Italian automaker’s Formula-One cars from car electronics to safety, aerodynamics to trouble-shooting, during and between races. TCS engineering software division contributes almost six per cent of its total revenue and almost 18 per cent of that comes from aerospace sector.

India gets entry into elite tech studies club: India was last week made a provisional member of the Washington Accord, a 10-member apex global organisation that determines standards of engineering education.

NHPC to invest Rs 27,000 cr in Arunachal Pradesh: National Hydro Power Corporation (NHPC) would invest Rs27, 000 crore in Arunachal Pradesh in the next 10 years for development of mega hydro projects.

Bajaj plans maiden car in Rs 2-5 lakh range: Bajaj Auto, India’s second-largest two-wheeler maker, plans to price its first car between Rs 2 lakh and Rs 5 lakh. A concept vehicle will be showcased in January 2008 at the annual auto show. The company has earmarked Rs 750 crore for a four-wheel production plant to manufacture 40,000 to 50,000 vehicles annually.

Japan lines up $30 bn for investment in core sector: Japan may announce an investment of $30 billion in infrastructure projects that would include building a high-speed freight railway system between New Delhi and Mumbai, a port in Gujarat, and industrial complexes in Rajasthan.

Shobha De writes in her column in India Today special issue on this anniversary of 60 years, “Whether India is merely poised, shining, glowing or growling, nobody will argue that India is certainly climbing, clambering, clawing its way to the top of the heap. About time, too. The only question worth asking is: what took us so long?”

However, I think the more importsnt is to find how can we expedite it further to go ahead with the competition.

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Let Bihar Emulate

Posted on July 2, 2007 by indra

Bihar of today is hardly industrialized. Unfortunately, the potentials for industrialization are also limited. It may have one big enough manufacturing unit for agricultural equipment of all sorts including small tractors, as Bihar will provide a ready market too. But the agriculture will remain the mainstay. Except for districts like Rohtas and some more, the state, particularly the north and western regions, still lacks irrigation facilities.

In every monsoon, the north Bihar remains under the threats of devastating floods affecting millions of people, mostly poor in rural areas. Unfortunately, hardly a major task has been taken up during last 60 years of independence. It would have attracted the minds of planners of the nation. Some major innovative projects of water conservation and storage would have been undertaken. But the priority perhaps skipped as Bihar gradually went out of the development politics. Floodwaters come and go; and soon draughts follow in the same regions. Should not the present government take up major projects to avoid the misery forever? It requires a special agency something like DVC that can take up all the necessary measures including all feasible river-interlinkings that has been abandoned by the UPA government at the centre.

Another way-out may be to create thousands of small dams, check dams, and waterbodies in the regions to store the rain and floodwater under all the schemes of the central government in a planned manner.

Gujarat may be taken a model to emulate. Gujarat is today the highest producer of oilseeds in the country. It has enhanced its agricultural production by almost one-and-a-half times in the last five-odd years through a multi-pronged strategy: efficient agro-management based on conservation of surface water, providing scientific information to farmers through the medium of Krishi Rath, and disbursement of a soil health card to every farmer. Under a soil health card policy, the scientists attached to the four agro universities in the state go to every farm and test the soil quality. The card helps the farmer provide the right nutrients to the soil, thus saving on wasteful expenditure. Around 17 lakh farmers in Gujarat have already received such cards. No wonder productivity has gone up. Can’t the universities in Bihar, particularly those having agricultural science department be made to do something on the pattern of Gujarat?

However, the most significant is Gujarat’s achievements in rainwater preservation for bad time of draught. It has happened by building 1.77 lakh farm ponds and 1 lakh check dams in public-private partnership, and deepening 5,000 village lakes, which has sent the water table soaring. Bihar must try to emulate Gujarat so far the creation of irrigation infrastructures are concerned.

Another success story from Gujarat is known world over as white revolution and credited to Kurien. It is something that can be emulated by all Indian states more so by Bihar. Its impact on rural economy will be significant.

Consider the economics: one buffalo gives roughly 5 litres of milk each day; people earn, depending on the fat content, Rs 15 to Rs 25 per litre. Even the poorest – one-buffalo owners – can earn. An infrastructure to collect and distribute the milk from the rural Bihar must get priority. The state must have a dairy in all blocks and collection centers that can cater to all prospective cattle owners all over the state.

There are many other things to emulate from other success stories. But one important change must come in the cultivation priorities of farmers in Bihar. As Punjab and Haryana switched over to high-value farm commodities, such as fruits, vegetables, milk, poultry products, meat and fish, Bihar must also do that.

Bihar must also increase its forest cover and encourage plantation of commercial trees. In good old days, we could see huge mango orchards in every village and even on the both sides of major roads one could see the fruit trees. All have gone. Can’t the state create a situation that can bring back that greenery?

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Pratibha Patil-A President I shall not be able to respect

Posted on June 30, 2007 by indra

It was a great thing for the nation to have a woman President for the first time, though many women even in our neighbouring countries with more conservative traditions have already held the top position. However, I will not be able to respect Pratibha Patil even when she becomes President for many reasons.

She doesn’t fall in line with the great men who have occupied the President House after independence starting from Dr. Rajendra Prasad, Dr. Radhakrishanan, Dr. Jakir Hussain, and even the incumbent Dr. Kalam. Dr. Kalam became perhaps the best President because of his unique personality and programme of inspiring the nation to become developed by 2020, and through his contacts with the student community. I wish the media carried out a poll.

It is unfortunate that the politicians, who matter, have decided to have only persons with political background as President of the country. The decision is criminal. It is denying the rest of the excellently qualified nationalist individual intellectuals a democracy’s opportunity that must not make any discrimination.

I don’t like the choice of Pratibha Patil as her name came as a candidate after Sonia Gandhi could not sell her pet and loyal Shivraj Patil to communists. Sonia Gandhi did neither select Shivraj nor Pratibha by a democratic process through her party forum such as CWC or Parliamentary Board. Perhaps both the names must have come up first in her kitchen cabinet or coterie. The whole of my family including myself have been with Congress all along. But making Congress a family business is hardly digestible. Unfortunately for long the Congress became a party of sycophants not that other party are not. I find almost all selection to the posts of significance going to those loyal to the family.

I don’t like Pratibha Patil as she was associated with a co-operative bank in Maharashtra that is reputed for all sorts of scams. Even without going into the specific bank with which Pratibha was attached, it makes one skeptical about her clean image. Cooperative banks, sugar mills, and professional educational institutions in Maharashtra are owned effectively by politicians and have been the dens of unscrupulous business and scams.

I expected Pratibha Patil to come out in media and clear all charges against her forcefully. She has been silent and moving around in public holding the hand of Sonia Gandhi and her sycophant subordinates.

I don’t remember any other candidate of the President position in past have been charged in the way Pratibha Patil is being done. After all what can be the interest of many journalists of repute who have raised questions about her suitability to the highest position of the nation? In Business Standard today TN Ninan has an article where he writes, ‘Though it has lost time, it is still not too late for the UPA to call an emergency meeting and, with Ms Patil out of the way, decide on a new candidate.’

L.K. Advani’s appeal to change the candidate itself is proof enough that even the independent candidate Shekhawat is not the best choice. The Congress would have taken this opportunity and should have listened to its own people at large and not some sycophants. It would have shown its magnanimity to get a consensus candidate on its own. Congress might have lost its face but the nation would have been immensely benefited and got a confidence to face such national crisis (as I call it).

But why wouldn’t Pratibha Patil herself have withdrawn after so much of mud slinging in media? Is she showing her hardcore strength against even her conscience? Is it the way a Gandhian behave? This is another reason I don’t like Pratibha Patil.

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Can I work at 68?

Posted on June 29, 2007 by indra

Last Tuesday, we had just returned after handing over some gifts for the kids in US to Alpna’s mother who was leaving for US at around 4.30 PM. The guard next door handed over the card of Brig. Shukla and also informed that Shukla had returned after waiting for some time. Shukla had requested me to call him back. I looked at Yamuna if we knew any Shukla. Her response was in negative. I called Shukla out of courtesy after I got settled. He asked if he could come to my place. I couldn’t have negated him.

Brig. Shukla is now working for a company-in-making that has a great plan on manufacturing cars in Himachal Pradesh. I was amazed, as I think I keep constant watch on the news from auto sector. I have not come across any such news. The promoter is Mr. Sharma, an IITian from Chennai. The promoters located me through Internet searching. They have a lot of information about my background. They want to have my services in getting the plant started. How would have I taken it? I was surprised and excited not as a job had come to me without any effort. I am enjoying my retirement for long many a years now. My excitement was about the unique entrepreneurship spirit that is prevailing in the country. The boom is all around. Shukla informed that the promoter Sharma would like to have a meeting with me. I affirmed that, mainly to know first hand about the project from the horse’s mouth. Shukla left. Pretty soon Mr. Sharma called me and sought a meeting after a day. I agreed.

Wednesday morning I got a call from Mr. Sharma. He wanted to have a meeting in Delhi over some drink. I showed my inability to come to Delhi. He agreed to come to my residence in Noida and meet me over a cup of tea.

A message came from Shukla before they started from Delhi. In the meantime, to my embarrassment Aroras came on a courtesy call. Sharma came with Shukla and his elder son Kartik, a young graduate in economics who appeared to be part of the team that has envisioned the project. Sharmas were very enthusiastic about the project: many models of cars covering entry to luxury ones, 4000 cars a day, with Rs 5000 crore investment arranged through NRIs and other institutions, on 2000 acres of land, powered by a captive 50 MW hydel power plant, flexible manufacturing systems to take care of different models, totally integrated plants from forgings and castings to gears and engine manufacturing, and sheet metal stamping to automated assembly and testing, its own R&D. Sharma has roped the former chairman of a navratna PSU, a former chief executive of Tata Motors, a former secretary of industry of Government of India, and perhaps some more persons. He has also engaged Lotus to develop the models and L&T to install the facilities. Sharma wants me to take care of the setting up the plant and production. However, the discussion went around the selection of manufacturing facilities and other management strategies. Sharma wanted if I could take the responsibility and what would be the financial package that I would be expecting. I naturally expressed my interest in understanding the project before I agree. The meeting ended with an agreement for another one where a presentation will come about the proposed manufacturing strategies and facilities.

Naturally I never imagined that such a proposal would come after I am out from the professional career for almost 6-7 years. I had opted for the total retirement. I never tried for any job thereafter. I don’t know if I am physically fit to carry on with this assignment. Preferably I would have liked to become a technical advisor or consultant. Yamuna also wants me to work only as part-time advisor. Many a times from somewhere inside me I get a wish to take one more plunge. But will it be a right decision at this age, even though many of this age or more are as busy as I would be after taking up the assignment if it comes?

Should I start working again at 68?

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