India Now Business and Economy Is a Bi-Monthly Magazine Published and That Has Been Perfecting the Right Approach

INSIDE ruRAL UPDATE It’s a vision of sustainability that India Now drives their development agenda innOVATION CORNER A patented mosquito trapper Business and that is eco-friendly and efficient emerGING ENTREPRENEURs Serial entrepreneur couple Economy script their fifth success story APRIL-MAY 2014 | Volume 01 | Issue 01

The Big Online Bazaar India scripts unique e-commerce success story connEcTing THE DoTS India’s internet industry is set to contribute up to US$ 100 billion to the country’s GDP and generate 22 million jobs by 2015.

For updated news analysis on Indian business and economy Log on to www.ibef.org

2 april-mayOCTOBER-NOVE 2013M www.ibef.orgBER 2013 | www.ibef.org editorial Volume 01 | Issue 01 | APRIL-MAY 2014 www.ibef.org

Editorial Editor: Anuradha Das Mathur Consulting Editor: Deepak Garg India’s Golden Era Managing Editor: Sangita Thakur Varma DEsign of Cyber Shoppers Sr. Creative Director: Jayan K Narayanan Sr. Art Director: Anil VK World wants a slice Associate Art Director: Anil T Sr. Visualisers: Shigil Narayanan & Sristi Maurya Visualiser: NV Baiju of the pie. Sr. Designers: Haridas Balan, Manoj Kumar VP Charu Dwivedi, Peterson PJ & Dinesh Devgan alls are passé. For the Indian consumer cyber- Designers: Pradeep G Nair & Vikas Sharma space is the new hangout for window shop- ONLINE & MARCOM ping. Here there are no traffic snarls, long Associate Art Director: Shokeen Saifi queues to park your cars, dust and grime, or Sr. Designer: Rahul Babu Web Designer: Om Prakash extremes of weather. You don’t need ready STUDIO cash. It’s available at COD (cash on delivery). You can shop from M Chief Photographer: Subhojit Paul your car, café, bar, home, office, college…you choose your com- Sr. Photographer: Jiten Gandhi fort zone, time and space. You don’t need to hop from one brand Sales & Marketing store to another to check out the latest—just flick your finger and National Manager-Events & Special Projects: Mahantesh Godi choose the right option and zoom! Well, we are talking about Regional Manager (South): Vinodh K e-commerce. And e-commerce is not just retail therapy but B2B, Regional Manager (North): Lalit Arun B2C, C2C and in multiple formats. With the Indian economy at Regional Manager (West): Sachin Mhashilkar the cusp of an e-commerce boom, the world is logged on for a Production & Logistics slice of this exciting pie. Read all about it in our Cover Story. Sr. GM. Operations: Shivshankar M Hiremath This couple is a dynamic combination of wit, grit and ambi- Manager Operations: Rakesh Upadhyay tion. Into their fifth enterprise, serial entrepreneurs Meena and Asst. Manager - Logistics: Vijay Menon K Ganesh have again hit the right notes with their homecare Executive Logistics: Nilesh Shiravadekar venture Portea Medical. A first in India, this outfit, providing com- Production Executive: Vilas Mhatre prehensive healthcare at home to patients, is already a startup suc- Logistics: MP Singh & Mohd. Ansari cess. We meet them in Emerging Entrepreneurs. What wouldn’t we INDIA BRAND EQUITY FOUNDATION do to get rid of those deadly bugs? Yes, with summer at its peak the CEO: Aparna Dutt Sharma mosquito menace is back. We discovered just the right innovation Project Manager: Pawan Chabra to combat the growing buzz—MozziQuit. A mosquito trapper that is cost effective, efficient and eco-friendly. Grassroots development needs sustainable and replicable initiatives. Here is an enterprise India Now Business and Economy is a bi-monthly magazine published and that has been perfecting the right approach. Drishtee is an inspiring printed by India Brand Equity Foundation (IBEF), Gurgaon, Editor – Anuradha Das Mathur. It is published from Apparel House, 5th Floor, #519-22, Sector 44, account of three youngsters and their many endeavours that are Gurgaon-122003, Haryana and got printed by GH Prints Pvt Ltd. A-256 Okhla, New Delhi-110020. impacting the rural space positively. India Now Business and Economy is for private circulation only. Material in this publication may not be reproduced in any form without the written permission This issue we have some insightful stories on India. Discover it. of IBEF. Editorial opinions expressed in the magazine are not necessarily those of IBEF and IBEF does not take responsibility for the advertising content, content obtained from third parties and views expressed by any independent author/ contributor. (India Brand Equity Foundation, Apparel House, 5th Floor, # 519-22, Sector 44, Gurgaon - 122003, Haryana, India; Email: [email protected]) The annual subscription to India Now Business and Economy comprises six (6) issues starting from the date of the subscription. The price for half-yearly subscription is INR 1000 and for annual subscription is INR 1500. Opinions expressed herein are of the authors and do not necessarily reflect any opinion of Nine Dot Nine Mediaworx Pvt Ltd., B-118 Sector 2 Noida – 201301, Sangita Thakur Varma Uttar Pradesh, India; Tel: 91-120-4010-999; Fax: 91-120-4010-911; Email: [email protected]

www.ibef.org | april-may 2014 1 VolumE 01 | Issue 01

ContentsAPRIL-MAY 2014 air p g n dee gn: pra i s e r D ve 1218 Co

Cover Story MNC Watch 14 | Full speed 18 | India Logs on to Shop ahead Yamaha India knows It’s an online festival in India for what young Indians are looking for and is supplying it aplen- consumers, sellers, investors and all ty—style, speed and value for other stakeholders connected to the money. It has the youth chorus- e-commerce space as the market is ing YES! Yamaha in unison. arts & culture forecast to grow sevenfold by 2020. 56 | More than just paranthasDelhi is the

Publisher, Printer Monika Choudhry has got ‘India Now Business and Economy’ street food capital of India printed by GH Prints Private Limited, A-256 Okhla, New Delhi-110020; and tracing its cuisines to history. For published from Apparel House, 519-522, 5th Floor, Sector – 44, Please Recycle instance, the parantha, a breakfast This Magazine Gurgaon – 122 003 on behalf of India Brand Equity Foundation (IBEF), Ministry And Remove of Commerce, Editor – Anuradha Das Mathur. Inserts Before staple, has an alley devoted to it Recycling that goes back 150 years.

2 APRIL-maY 2014 | www.ibef.org 1036

Interview 10 | “While marketing to Gen-y remember to always remain relevant” Venu Madhav, Director, Cafe Coffee Day, on the company’s success mantra and future plans.

Innovation Corner 52 | The big bug slayer An effective weapon to fight the mosquito menance is finally within our reach. It is a patented and 2030 awarded mosquito trapper called MozziQuit.

34 | Agrochemicals: 38 | insurance: 41 | water: Thirsting 45 | business The Right Growth Input Policy Success for Success India’s aviation: Raring to Go The crop protection industry, growing Phenomenal growth in the last growing water needs and the Economic prosperity has given at 12 per cent per annum, is an export decade and innovative plans rising opportunitities in all wings to the business aviation success and is experiencing rising ensure that the industry will water verticals make the sector a sector with Indians increasingly domestic demand. grow to US$ 280 billion by 2020. global investment destination. looking to fly privately.

www.ibef.org | APRIL-maY 2014 3 Voice of A visionary “I have always been very confident and very upbeat about the future potential of India. I think it is a great country with great potential.” National —Ratan Tata, Chairman Emeritus, Tata Sons Round-up photo by thinkstockphotos.in

India third-largest in PPP Terms Data Briefing Owns 6.4 per cent of the global GDP 6.4% A recent report by The World Bank declared in geographical scope. This round (ICP 2011), India the third largest economy in the world, covered 199 countries. In the 2005 survey, India India’s ahead of Japan, based on purchasing power par- was ranked the 10th largest economy. Based on share of ity (PPP). This count is done every six years by the PPP measure, the US controls 17.1 per cent of measuring economies on the basis of their PPP. the world’s gross domestic product (GDP), while world GDP The US is ranked at the top spot followed by China has 14.9 per cent and India owns 6.4 per China. cent with Japan in the fourth spot with 4.8 per According to the report, PPP is price relative cent. In the GDP measure, the six largest middle and shows the ratio of prices in national curren- income economies—China, India, Russia, Bra- cies of the same goods or services in different zil, Indonesia and Mexico—account for 32.3 economies. Compiled by The World Bank under per cent of world GDP, whereas the six largest the International Comparison Programme (ICP), high income economies of US, Japan, Germany, it is a worldwide statistical initiative—the largest France, UK and Italy account for 32.9 per cent.

4 april-may 2014 | www.ibef.org National Round-up

They Jen Psaki Said it

Washington, May 13, 2014 India has organised “the largest- ever free and fair democratic election in human history… an inspiring example of the power of the democratic process in action, and the United States, like so many others around the

photo by thinkstockphotos.in world, has great admiration and respect for the vibrancy, diversity India has 54 of World’s Larg- and resilience of India’s est Cos In Forbes Global 2000 democracy.”

india is home to 54 of the world’s most powerful and largest companies, as — Jen Psaki, ranked in Forbes' annual list of the world's 2000 largest and most powerful Spokeswoman, US public companies. The Forbes ‘Global 2000’ is a comprehensive list of the State Department world’s largest, most powerful public companies, as measured by revenues, profits, assets and market value. The US with 564, retained its dominance as the country with the most Global 2000 companies, while Japan trailed behind the US with 225 companies on the list. Mukesh Ambani led Reliance Industries ranked 135 on the list with a market value of US$ 50.9 billion and US$ 72.8 billion in sales as of May 2014. It was followed by State Bank of India which is ranked 155 and has a market value of US$ 23.6 billion. Other Indian companies on the list included Oil and Natural Gas ranked 176, ICICI Bank (304), Tata Motors (332), Indian Oil (416), HDFC Bank (422), Coal India (428), Larsen & Toubro (500), Tata Consultancy Ser- vices (543), Bharti Airtel (625), Axis Bank (630), Infosys (727), Bank of Baroda (801), Mahindra & Mahindra (803), ITC (830), Wipro (849) et al. This year’s companies are from 62 countries, up from 46 in the inaugural 2003 rankings.

RESEARCH UPDATE Anticancer Molecule Trials Pact Aurigene Discovery Technologies, a Bengaluru based drug discovery services company, has signed an agreement with Pierre Fabre, a French pharmaceutical company, to develop into clinical trials a new molecule called AUNP-12—the first anticancer molecule licensed by Aurigene.

www.ibef.org | april-may 2014 5 National Round-up

Sound bytes “We held investor meetings in the US...and the level of optimism about India is very high. I have not seen such interest in recent times, we could see huge portfolio flows.” Shikha Sharma, CEO, Axis Bank

“India is going to photo by thinkstockphotos.in redefine modern India world’s most affordable healthcare… This is going to be a market To cross US$ 5 trln by 2025 game changer...the solutions found in India is the cheapest major major economy, while the cent over the next 10 years,” the Indian healthcare economy in the world, says United States is the cheapest the research report said. market are going to a survey report of global developed country. For a If the report’s projections find their way to the prices of products that are developing country, Brazil was come to fruition, India would US and Europe...this comparable across countries. found to be very expensive. join ranks with the US and The report by Deutsche Bank, China on the other hand is very China, the only countries to is the most important the German banking giant, cheap in some categories like have crossed the US$ 5 trillion entrepreneurial said that a weaker Indian car rentals, while for a number mark, and become the fifth healthcare market in rupee has allowed the country of branded goods, it is more largest economy (from 10th the world.” to remain the cheapest major expensive than the US. currently) in the world. Jeff Immelt, CEO, General Electric economy in the world. The Another study by Morgan The report noted that the survey is an overview of Stanley forecasts the effects of policy measures prices and price indices of Indian economy crossing over the past 12 months a wide array of goods and the US$ 5 trillion mark by are beginning to show in services from around the 2025 with improvement in improving macro stability “The US is world. The data was culled macroeconomic indicators indicators, adding that the committed both by directly surveying and steady implementation of growth will pick up from FY16 to working prices posted on the internet policy reforms. onwards. with India and from secondary sources. “In our base case, we expect a The report said that The report titled The steady pace of implementation variables like economic to fully unlock the Random Walk, Mapping of policy reforms, which will lay reforms along with a pickup true potential of our the World's Prices 2014 the foundation for the country's in the pace of structural economic ties.” found Australia to be the real GDP growth to move reforms would be the key Nisha Desai Biswal, Assistant Secretary of State for South and overall most expensive higher to an average of 6.75 per factors for growth. Central Asia, US

6 april-may 2014 | www.ibef.org National Round-up

Industry Investment Tracker update India has huge potential to attract FDI from Europe Pharmexcil Promotes Indian European Cos largest investors Pharma Ropes in embassies

the pharmaceuticals Export at concerned local bodies and Promotion Council of India associations abroad. (Pharmexcil) has been working Pharmexcil was keen to generate closely with the Indian embassies greater interest in the Indian drug across the globe to promote industry in a buildup to iPHEX 2014 pharma exports. This strategic that was held in Mumbai from May approach has helped the Council 21–23, 2014. The hard work of the generate widespread interest in industry body paid off generously the international as more and more community on overseas investors between 2004 and During the same period, the important US$ showed keen 2013 India attracted For- US firms invested US$ 138 role of Indian interest in doing eign Direct Investment (FDI) billion, while Japan put in manufacturers as business in India. to the tune of US$ 198 bil- US$ 50.7 billion, according global suppliers of The government lion from European com- to the report. quality generic drugs. 25 is also taking steps panies. This was revealed “This gives EU enter- Pharmexcil has Billion to identify and pro- in a report brought out prises the distinction of been working with vide help to those by the Brussels based being the largest inbound the Indian embassies Pharmaceutical overseas investors Europe India Chamber of investor into India. EU firms to sensitise and exports target for and delegates who Commerce (EICC) titled have spent US$ 118 billion educate prospective had brought size- European Companies in on 2,566 Greenfield proj- FY 2014-15 overseas investors able business to India: Reigniting Economic ects. EU companies also about the Indian India during their Growth. acquired interests in 1,442 drug industry. last visit. The report also pointed companies for US$ 80 bil- According to reports following Pharmexcil along with India to the huge potential to lion,” said Sunil Prasad, Pharmexcil’s efforts, Indian Brand Equity Foundation (IBEF) boost this investment Secretary General, EICC. embassies have been working has been leading the global Brand inflow. The report was The EICC Study was hard to spread goodwill about the India Pharma campaign to improve released at a function by supported by the EU fund- Indian drug industry by conducting the global perception of the Indian the head of the EU Delega- ed European Business and sensitising seminars and meetings pharma industry. tion to India, Joao Cravinho. Technology Centre (EBTC).

tourism Tracker the country to understand See India Vote how the EC microman- Election tourism trips ages the election process. Election tours included foreign tourist arriv- of India. Under this initia- visits to a campaign rally als spiked during the elec- tive—Election Visitors Pro- and offices of political par- tion period as more and gramme—by the Election ties. Representatives from more tourists arrived in the Commission of India and Nigeria, Namibia, Lesotho, country to watch the Lok the United Nations Develop- Malaysia, Mauritius, Nepal, Sabha elections in full swing ment Programme (UNDP), Uganda, Kenya, Bhutan, under an election tourism around 50 officials from Syria, Egypt, Tunisia, Saudi programme launched by election management bod- Arabia, Morocco, etc., were the Election Commission ies of 20 countries toured part of the campaign.

www.ibef.org | april-may 2014 7 india watch Area Population Male Female Population Density Urban Population 3,287,263 sq km 1.27 billion 655.8 million 614.4 million 382 per sq km 380.214 million

Key performance India’s Economic Outlook Projection indicators of the Fiscal Year 2011-12 * 2012-13 * 2013-14 ** 2013-14 * 2014-15 ** Indian economy GDP Growth 6.20% 5% 5.90% 4.80% 6.00% with patterns, CPI 8.87% 9.50% 10.40% 8.79% 8.00% Source: RBI * Actual trends and forecasts ** Projected

Mean Probability Pattern of Growth Forecast 2013-14 2014-15

0.8 Average real GDP growth for 0.7 the next five years (2013-14 to 2017-18) and the next 0.6 10 years (2013-14 to 2022- 0.5 23), is expected to be 6.5 per cent and 7.25 per cent, 0.4 respectively. 0.3

0.2

0.1

0.0

4.0 to 4.4 % 4.5 to 4.9 % 5.0 to 5.4 % 5.5 to 5.9 % 6.0 to 6.4% 6.5 to 6.9% 13-14) 3: (Q Forecasters Professional of Survey Source:

Chart 1: Year-on-Year Growth in IIP Chart 2: Year-on-Year Growth in Sectoral Indices

16% 16% 12% 12% 8% 8% 4% 4% 0% 0% -4% -4% -8% Source: ICRA Analysis ICRA Source: -8% Analysis ICRA Source: -12%

Apr-10 Jul-10Oct-10Jan-11Apr-11 Jul-11 Oct-11Jan-12Apr-12 Jul-12Oct-12Jan-13Apr-13 Jul-13Oct-13 Jan-14 Apr-10Jun-10Aug-10Oct-10Dec-10Feb-11Apr-11Jun-11Aug-11Oct-11Dec-11Feb-12Apr-12Jun-12Aug-12Oct-12Dec-12Feb-13Apr-13Jun-13Aug-13Oct-13Dec-13Feb-14 Mining Manufacturing Electricity

8 april-may 2014 | www.ibef.org www.ibef.org | april-may 2014 9 India Watch

Chart 3: Contribution to IIP Growth Chart 4: FDI and FII Inflows (in US$ billion)

4.07 4.06 4.13 3% Intermediate FDI 2% 0.5% 2.32 2.49 2.60 2.06 2.18 2.01 1% Electricity, 0.9% 1.79 1.63 FII 1.521.52 1.63 1.44 1.65 1.40 Basic 1.5% 1.22 1.31.10 0% Mining 0.1% 0.90 0.12 -1% Manufacturing Capital -2.5% -1.04 -0.90 -2% -3.0% -1.85 -3% Durables -1.3% -4% Non Durables Jul-13 Feb-13 Mar-13 Apr-13 Jun-13 Oct-13 Jan-14 Feb-14 0.2% May-13 Aug-13 Sep-13 Nov-13 Dec-13 RBISource: -5% 2013) (November Analysis ICRA Source:

YoY Wholesale Price Index (Inflation) Key Macroeconomic Indicators November, 2013 December, 2013 Cash Reserve January, 2014 15.3 Ratio

4.25 10.8 11.1 1111.1 4 4 4 4 4 4 4 4 4 4 4 4 4 4

7.5 7.1 6.2 5.2

2.9 2.6 2.6 Source: RBI Source: All Commodities Primary Articles Fuel & Power Manufactured Products

Stock Market

Sensex %age Change S&P CNX NIFTY %age Change Jul-13 Feb-13 Mar-13 Apr-13 May-13Jun-13 Aug-13Sep-13 Oct-13Nov-13 Dec-13 Jan-14Feb-14 Mar-14 Apr-14 Jul-13 19,709.71 2% 5,909.24 2% Aug-13 18,641.41 -5% 5,510.44 -7% Source: RBI Sep-13 19,627.23 5% 5,797.48 5% Oct-13 20,492.94 4% 6,083.87 5% Nov-13 20,791.33 1% 6,128.64 1% Repo Rate and Dec-13 21,170.68 2% 6246.87 2% Reverse Repo Rate Jan-14 20,513.85 -3% 6223.16 0% Feb-14 20,521.34 0% 6,098.74 -2% Mar-14 21,815.71 6% 6,507.98 7% 8 Source: RBI Source: Apr-14 22,585.44 4% 6,760.85 4% 7.8 7.6 Currency Exchange Rate 7.4 INR/USD INR/GBP INR/JPY INR/EUR 7.2 Jul-13 63.21 97.87 64.57 84.18 7 Aug-13 59.78 90.78 60.00 78.20 6.8 Sep-13 63.75 101.09 64.26 85.11 6.6 Oct-13 61.61 99.20 62.99 84.10 6.4 Nov-13 62.63 100.88 62.63 84.53 6.2 Dec-13 61.91 101.40 59.83 84.82

Jul-13 Jan-14 60.42 102.29 59.66 84.60 Nov-12Dec-12Jan-13Feb-13Mar-13Apr-13May-13Jun-13 Aug-13Sep-13Oct-13Nov-13Dec-13Jan-14Feb-14Mar-14Apr-14 Feb-14 62.25 102.97 61.01 84.96 Mar-14 61.00 101.40 59.61 84.32 Repo Rate Source: RBI Source: Reverse Repo Rate Apr-14 60.34 101.00 58.84 83.31 Source: RBI

8 april-may 2014 | www.ibef.org www.ibef.org | april-may 2014 9 Amalgamated Bean Coffee Trading “While marketing to Gen-Y Company (ABCTL) has successfully gone the distance from a purely remember to always plantation-focussed business towards becoming a vertically integrated coffee remain relevant...” conglomerate. What prompted this massive shift and what are the key Venu Madhav, Director, Café Coffee Day, discusses the learnings from the company’s company’s business model and how it has managed to stay experience? relevant over the years in this exclusive interaction with India Venu Madhav (VM): V G Siddhartha, Now Business and Economy. who belongs to a family of coffee plantation owners, was selling coffee

10 april-may 2014 | www.ibef.org www.ibef.org | april-may 2014 11 Café Coffee Day interview

in the international market post the deregulation of the Coffee Board of India in the nineties. It was around that time that he realised the potential that lay ahead in building a coffee brand for the Indian market. This is when Coffee Day was born. The brand’s first sub brand retail venture was Coffee Day Fresh n’ Ground, the loose coffee powder. In the late 1990s, the company also found some inspiring trends and opportunities in the market: 1. Coffee drinking in India was limited to the South Indian traditionalist, the intellectual and the five star coffee shop visitor. 2. These cafes were promoting cyber culture and were offering internet access. 3. In the neighbouring international markets of South East Asia, there existed a popular culture of consumers visiting a café for experiential drinking of coffee in addition to a glass of beer. These trends and need gaps inspired Chatting over coffee: Café Coffee Day stepped in to provide a much needed space for the urban youth to ‘hang out’ us, and in 1996, we launched the first with friends and colleagues for some coffee and conversation. cybercafé modelled on our international learning, replacing beer with coffee. have been able to cater to our target This was arguably India’s first customers by revolutionising the farming practices. commercial cybercafé. Of course, later, hangout concept at regular intervals. Seasonality in supply and demand, with the mushrooming of cybercafés, market dynamics, demand for variety ABCTCL decided to concentrate on its Can you throw some light on the in product and packaging, higher core strength—coffee. best practices followed by ABCTCL, expectations on product quality and We believed that a coffee retail venture right from plantation practices to supply delivery, all have added extra dimensions would work because we were the first chain management to value addition, to the challenge. to fulfil a latent need gap in the market. retailing and branding? Though CCD’s core competence lies With the advent of cable television and VM: ABCTCL’s biggest strength in in the coffee growing/brewing/serving growing consumerism, the Indian coffee retailing lies in the fact that it is areas, the demand for a variety of food urban youth were looking for a window a coffee conglomerate that is involved items and beverages has forced it to of opportunity to connect them to from the bean right up to the cup stage. diversify and increase the number of the way of ‘meeting and greeting’ of The retail points have absolute quality pages in the menu to include various the youth in other countries across measures and the company can offer the exclusive offerings customised to the world. They were seeking a world benefits of pricing to its customers. The the needs of various geographic and class experience rooted in Indian coffee served is procured from 13,000 demographic segments of society. This culture. We chose to fulfil this demand. acres of the company’s own estates plus means an increased supplier base in Substantiation of our acceptance is another 7,000 acres of managed estates. the CCD supply chain. The suppliers through our present network strength of The group also sources coffee from include both domestic and foreign 1,522 cafes across 186 cities in India. 11,000 small growers, making its holder players. The supplier base is built by A key learning while marketing to the largest individual coffee plantation strictly adhering to the QCD metrics Gen-Y is to remember to always remain owner in Asia. The estates are UtzKapeh (Quality-Cost-Delivery). CCD has relevant, innovative and exciting. We certified, which stands for sustainable various Fresh Assembly Centres where

10 april-may 2014 | www.ibef.org www.ibef.org | april-may 2014 11 Interview Café Coffee Day food is assembled before being taken in-home consumption of coffee in the “However, out to individual cafes. ABCTCL has non traditional markets in our country. been bestowed with ISO 22000:2005 The country currently has around 1,800 that does certification by the DNV Business cafés and there is scope for 5,000 or so not make Assurance Food Safety System for its more outlets. So essentially, the management system in cafés. The potential for growth in the us believe company is the first large scale food and consumption of coffee is huge. beverage retailer to have received such In advanced markets like Austria the that the marketer an honour with respect to so many key per capita consumption of coffee is at should also be business units. 10 kg and in the USA it is about 5-6 kg. Currently in India this figure is at about millennial. As How is ABCTCL leveraging its 600g, which is to say that there is still presence in India, and what key large scope for growth. We are also long as she or he differentiators would you like to highlight working on increasing this knowledge has the mindset with respect to ‘Made in India’ coffee? on coffee and building the coffee VM: ‘Made in India’ coffee is at par with culture through coffee festivals that required to any world standards. We grow very high we conduct for consumers across Tier quality Arabica beans and have various I and Tier II cities in India. The café market with these single estate coffees that we take great culture is on the rise and this will also millennials. With pride in. For instance the café brand lead to in-home consumption of coffee CCD retails single estate coffees such and we believe coffee is fast becoming Facebook, Twitter as ‘Dark Forest’ and ‘Mysore Royal’. the beverage of choice for young India. ...these networks These are premium coffees. Dark Forest is a full bodied single origin coffee Tell us about ABCTCL’s presence in allow you to listen which comes from the Kathlekhan the fresh and ground coffee retail Estate. History is replete with folklore space through Coffee Day Fresh & and co-create.” at Kathlekhan (a word that means dark Ground. How has the venture progressed, —Venu Madhav, Director forests in Kannada, the local language of and how do you see the potential of the Cafe Coffee Day the region) Estates, the origin of which Indian market in this arena? is traced back to 1832. The coffee berries VM: As the pioneer and leader of an are handpicked by a tribe that specialises organised market for powdered filter expansion. in the profession. Single origin coffees coffee, at present Fresh & Ground How have the preferences of the have a uniformity of flavour and has 425 unique retail stores across target audience changed over the richness, a parameters of quality. Karnataka, Tamil Nadu, Andhra past 20 years, and how are you reflecting ABCTCL is one of the few fully Pradesh, Pondicherry, Kerala and them in your hangout zones? integrated coffee conglomerates in Maharashtra. Around 95 per cent VM: The CCD customer is the the world. The company not only of stores are self owned while the millennial customer: this is a set of grows its own coffee but contributes others are franchises which are closely customers who have had their formative majorly to employability in the country serviced by Fresh & Ground’s strong years during the most prosperous period and trains and develops its human supply chain network, ensuring that of Indian economy. The challenge in resources. The company also produces the coffee powders are always fresh reaching out to them is the fact that their the furniture used in its retail spaces (no more than 5 days on shop shelves) interests are ephemeral. This requires that alongside the coffee makers, etc. and retain their original aroma. The they move from a talk mode to a listen price of the Fresh & Ground coffee and converse mode with the consumers. How do you see the rise in the powders ranges from `220 to `380 This forced need to listen brings about a coffee culture in India, and what is (US$ 3.76 to 6.49) per kg. new marketing discipline of living with your perspective on the future potential Coffee powder consumption in and co-creating with the consumers. The of the Indian coffee sector in both Indian India has been growing at a rate 10–12 brand CCD, has co-created its existing and overseas markets? per cent in the last few years and will look and feel from consumer feedback. VM: We have always believed that the increase to 20–30 percent in the next The logo itself is a dialogue box which out of home coffee consumption in five years. Strong growth opportunities stands for conversations between the India is fast growing and has are forecast, and this is the right time for brand and its consumers. That adds a contributed immensely to the growth of the brand to make the most of it through whole lot of responsibility.

12 april-may 2014 | www.ibef.org www.ibef.org | april-may 2014 13 A SHADE BETTER India is the only country that grows coffee under a well defined two tier mixed shade canopy.

For updated news analysis on Indian business and economy Log on to www.ibef.org

12 april-may 2014 | www.ibef.org www.ibef.org | april-may 2014 13 MNC WAtch Yamaha

COMPANY DASHBOARD

Company India Yamaha Motor Pvt Ltd

Established Forayed into India in 1985, in 2001 became 100% subsidiary and in 2008 a joint investor in IYM

Headquartered in Surajpur, UP

Area of Focus Two wheelers

Network Two facilities An independent sales & marketing entity 2,000+ employees Full Speed Ahead YES! Yamaha captures young India’s heart. By sanjay ojha

14 april-may 2014 | www.ibef.org Yamaha MNC WAtch

apanese two wheeler maker, India Yamaha “The response that we have been Motor Pvt Ltd (IYM) is riding high on its ever- receiving for RAY and Ray Z are growing market in India. TheJ MNC, which entered India in indeed most positive...Both sold 1985, is upbeat with record two wheeler approximately 150,000 units by end sales in the past few years. It has plans to capture 10 per cent of the market 2013, thanks to the stylish design share by 2016, when the two wheeler industry is expected to produce about and ease of use. We understand the 20 million units. needs of our customers....” In order to expand its sales network across India and take its product closer Roy Kurian to its customer base particularly in Vice President, Sales & Marketing, Yamaha Motor India Sales Pvt Ltd the Tier II and III cities, which are witnessing strong demand for two males choose the company’s sports bikes. YFZ-R15 and Ray have been the previous wheelers, the company plans to expand The price range is also a catalyst among winners. Yamaha entered the scooter its dealer network from 400 to 2,000 customers,” said Deepak Garg, who runs category in 2012 with the Ray which was by year 2018. a Yamaha showroom in Patna. aimed towards women. This was soon IYM produces two wheelers for both Yamaha Ray Z was awarded the India followed by the Ray Z that targeted the domestic and foreign markets from Design Mark (I Mark) award by the male audience. its two state-of-the-art manufacturing Indian design council on May 7, 2014. facilities in Surajpur in Uttar Pradesh A prestigious award, the India design Aggressive Expansion Plans and Faridabad in Haryana. mark is a standard that recognises good India Yamaha created a functionally The Surajpur plant, which was design and is granted to an applicant independent sales and marketing established in 1984 and upgraded in after a thorough and systemised process. entity, Yamaha Motor India Sales Pvt 2009, has the capacity to produce The India design mark was initiated by Ltd (YMIS) located in Chennai, with one million motorcycles and scooters the council in cooperation with Japan the aim to further strengthen sales and annually. Established in 1965, the Institute of Design Promotion (JDP). marketing services in India. YMIS has Faridabad plant was upgraded in 2008 This is Yamaha’s third consecutive win. endeavoured to bring its relationship for manufacturing of machine parts. with customers closer with its Yes! Yamaha! campaign (Yamaha Extended Robust Growth Trend Service [Y.E.S.]) which emphasises on India Yamaha recorded a growth History in Making providing the best 3S experience— of 29 per cent in domestic sales sales, service and spare parts. YMIS 1953 >> Conceptualised by Genichi during March 2014 as compared to Kawakami, Yamaha’s first President is currently responsible for the sales the corresponding period last year. and promotion of YZF-R15 Version 2.0 In the export markets, the company 1954 >> First model, Yamaha YA-1, (150cc), Fazer (153cc), FZ-S (153cc), FZ was designed sold 15,187 units in March 2014 as (153cc), SZ-X, SZ-R & SZ-RR (153cc), compared to 14,691 units sold in the January, 1955 >> Hamakita Fac- SS125 (123cc), YBR 125 (123cc), YBR 110 same month in the previous year, tory of Nippon Gakki was built and (106cc), Crux (106cc), Ray (113cc), Ray production began on the YA-1 achieving a growth of 3.4 per cent. Z (113cc) and Alpha (113cc). The import IYM witnessed a fruitful year in 2013 July, 1955 >> Yamaha Motor Co portfolio includes VMAX (1,679cc), Ltd was founded. Staffed by 274 after recording a 34 per cent growth employees, the new motorcycle YZF-R1 (998cc) and FZ1 (998cc). rate despite a sluggish market. The maker built about 200 units per The ambitious company, in company strengthened its position by month August 2012, announced its third clocking sales of 651,487 units in 2013, 1956 >> Second model, YCI, was manufacturing facility in Chennai and compared to 486,810 units in 2012. ready for production proposed to invest `1,500 crore (US$ “Earlier, we could see very few people 1958 >> Yamaha ventured into the 250.3 million) over the next five years, turning towards Yamaha bikes at our international arena by entering the to expand business locally and also shop, but now the trend in different. US market intensify export in overseas markets. Young girls prefer Ray, while young This investment was in addition to

www.ibef.org | april-may 2014 15 MNC WAtch Yamaha

the `750 crore (US$ 125.15 million) Launched being invested in the existing facilities its popular Entered the scooter segment in Surajpur and Faridabad. The new Launched superbikes FZ series to target young with Yamaha Ray to target Chennai factory is expected to produce R1, FZ1 and VMAX, and young women also the first sports bike customers about 400,000 vehicles, the number YZF R15 set to reach 1.8 million vehicles by MoU with Established Yamaha Motor India Sales Pvt Ltd 2018. Mitsui & Company Ltd Tamil Nadu government Yamaha Motor Research and entered into agreement with Yamaha to become for setting up Established fifth global R&D Development India Pvt Ltd (YMRI) was joint investor in India its third plant centre in India at Surajpur established in Surajpur in February Yamaha Motor Private in Chennai after Italy, Taiwan, China, and Thailand 2013 to function as the motorcycle Limited (IYM) |||||||||||||| R&D headquarters for Yamaha |||||| |||||| |||| |||| Launched its first ||| ||| Motor Company. This initiative is Yamaha India ||| 2012 2012 || || ||| mascot for children’s became 100 per || 2009 2013 || in accordance with the company’s || || safety programme || || cent subsidiary || | strategy to catalyse the global | 2008 2013 || || | of Yamaha Motor | || | | | | competitiveness of its engineering, | | Company Ltd | 2008 2014 | | | | | | | Launched manufacturing and marketing | | | | | | | 2001 | automatic | 2014 functions in India. | | | | Milestones | | scooter | | | Entered | |

| | Alpha to | |

| the Indian in India |

| 1985

Redefining Models | |

| target family

market |

| customers

In March 2014, YMIS launched the |

| |

| variants of its bestselling Yamaha R15 | version 2.0 in vibrant colour schemes | to increase excitement amongst customers and enhance sales growth. The company launched its latest automatic scooter, Alpha, in February brands, while youngsters’ heartthrob measures. this year, aimed at targeting family actor Deepika Padukone endorses the Based on its fundamental belief customers. Yamaha’s female scooter scooter range of the company. that corporate activities originate with Ray was modified to the new Ray Z and for people, Yamaha Motor Group to target male users. Two new model Responsible Social Business strives to contribute to sustainable variations in the Yamaha SZ sports Yamaha India has started an all- development through business model series were named the SZ-RR women assembly line for scooters at activities and endeavours to abide by and SZ-S. Yamaha’s popular FZ series the Surajpur plant. The company offers international laws and regulations. In motorcycle was modelled into FZ-S classroom and on the job training to accordance with its policy of making and Fazer in August 2013 to target 200 women, who are undergoing a the workplace disabled friendly, young customers. three year apprenticeship programme Yamaha Motor has established the approved by the UP government. These Disabled Employment Promotion Revving up Customers’ Choice women will receive an ITI certification Committee. Led by its Central Safety IYM wishes to establish itself as approved by the UP government after and Health Committee, Yamaha Motor the exclusive and trusted brand completing the course. Besides, the is promoting the establishment of of customers by “creating Kando” company began a training programme safer working environments globally (touching their hearts), through for female customers throughout India. by detecting potential dangers and continuously innovating business IYM has hired more women to work in initiating measures to mitigate processes. The theme of the Yamaha’s customer service and introduced female accidents at workplaces. The company booth at the recently held 12th customer care programmes with an aim works to reduce greenhouse gas Auto Expo was “Revs your Heart”, to improve its customer care service emissions from its manufacturing with a belief that customers’ hearts for women customers. The Yamaha facilities. In 2013, Yamaha Motor will accelerated to experience the Children Safety Programme (YCSP), reduced carbon dioxide emissions per company’s products. launched in January this year, is a first of unit of sales by 14 per cent below the IYM has chosen Bollywood actor its kind social initiative by the company 2012 level. and popular youth icon John Abraham to educate and influence both parents (Source: Secondary research and as its ambassador for motorcycle and children about vital road safety company website information)

16 april-may 2014 | www.ibef.org Yamaha MNC WAtch

www.ibef.org | april-may 2014 17 cover story E-commerce Market

18 april-may 2014 | www.ibef.org e-commerce market cover story India logs onto Shop

From kitchen knives to cars, Indians from Kol- hapur to Kolkata, Kinnaur to Kanyakumari are logging on for the instant gratification of hassle free online buying. As the e-commerce market reinvents new paradigms to suit its customers’ varied tastes, it scripts an e-gateway to unprecedented success. By Sangita Thakur Varma

www.ibef.org | april-may 2014 19 adhumati Devi in Madhubani district of Bihar has never seen a computer. Nor has she ever heard of concepts like e-commerce or bought anything online. But the Madhu- bani painting saris and stoles she makes are selling like hot cakes on a niche e-commerce portal that specialises in Indian ethnics. Sunil, her son, has shown her pictures of her products on the website on his smartphone. He also sports a Calvin Klein (CK) watch that he bought online and a pair of Reebok shoes. He got them at major bargain prices, he claims proudly, at the Google Online Shopping Festival (GOSF). Be it Barabanki in Uttar Pradesh, Amravati in Maharashtra, Asansol in West Bengal, Kathgodam in Uttarakhand, Bellary in Tamil Nadu, Kameng in Arunachal Pradesh or any corner of the country, the reach of e-commerce is as wide as telecom network services, the rapidly rising numbers of feature rich mobile phone users in the country and the postal network of pin codes. It’s boom time then for electronic commerce in India. According to various reports, India’s e-commerce market will grow sevenfold to US$ 22 billion by 2020, on the back of improving internet infrastructure which will aid ease of shopping on the go for the approximately 213 million online consumers of India. According to a September 2013 report by Internet and Mobile Association of India (IAMAI) and KPMG, the e-commerce market, growing at an average annual rate of 34 per cent since 2009, was expected to touch US$ 13 billion by end 2013. By 2017, revenues of e-commerce companies could triple to US$ 8.13 billion, according to Crisil Research. India’s e-commerce market (sans travel sites) is currently worth US$ 3.1

M-commerce: Booming Market

Mobile shopping grew 800% in 2013, expected to Factors leading to major adoption of mobile as a channel: grow at a 150% CAGR upto 2016 l 70% of the growth in Indian internet users was mobile only l Showrooming—a growing habit

Reasons why there is not a 1:1 conversion of traffic to mobile:

l Most e-retailers do not have mobile optimised sites l Most transactions are for low ticket items l Mobile marketing budgets are < 10% of overall digital marketing budgets, even though they have increased 100% Y-o-Y, and 1x 8x 27x even though overall ad spends have increased 20% Y-o-Y 2012 2013 2016

Mobile revenue share is lagging India vs rest of BRICS—mobile shopping Gross Mobile traffic share in India and China Merchandise Volume (GMV) as % of overall GMV

Mobile Traffic % Mobile Revenue % 33% 33% 9.8% 27% 9% 23%

4% 9% 10% NA

India China Japan India Brazil Russia China

Source: Accel India

20 april-may 2014 | www.ibef.org E-commerce market cover story

billion annually. According available statistics of 2011, the online travel sales division has captured the biggest slice of the e-commerce market accounting for 81.4 per cent. An eMarketer report titled BRIC Travel Markets in Transition: Trends Influence Overall Ecommerce says “The ecosystem for Indian entre- India is expected to register a CAGR of 30.6 per cent for online travel sales, preneurs has changed drasti- surpassing the rate forecast for South cally over the past few years. Korea (19.8 per cent), Brazil (18.2), Murugavel Janakiraman Investors are looking for good China (14.1), Russia (9.8), Australia (7.4) Founder & CEO entrepreneurs and if you are in and the US (7.2) during 2011–16. Matrimony.Com According to the IAMAI-KPMG the market with a good idea, report, in 2013, India had 137 million people are willing to invest internet users and 25 million online in your start-up. Today, the buyers. A subsequent report released in December 2013 put the figure of inter- internet user base in India is sub- net users in India at 213 million and stantial. There is still a long way the size of the market at US$ 13 billion. to go before we match the scale The e-commerce market in the US, of Silicon Valley in the West, but China, and Sri Lanka was estimated at US$ 224 billion, US$ 220 billion, and the good thing is that the first few US$ 2 billion, respectively. steps have already been taken in that direction.” Frenetic Growth, Money Pours In But what is behind the frenetic pace of growth? Why are investors lining up to pump their money into these e-commerce ventures that are yet to show profit? Primarily, it is the demo- en by their rising disposable income. CEO, Matrimony.Com, one of the first graphic profile of the young internet Notably, discretionary spending in movers in the internet space knows savvy Indians with higher disposable India is expected to jump to 70 per cent this. “The online matrimony market incomes who will be the new custom- by 2025 from 52 per cent in 2005. Also, in India is currently worth `400 crore ers of e-commerce portals in the next the growing inclination towards pur- (US$ 67.24 million). The industry five years that is behind the gold rush. chasing online is reflected in the trend has been through a transformational The number of internet users in India for higher value online transactions. shift in terms of consumer preference. could grow to 500 million by 2015, Shoppers are ready to shop for values Around a decade ago, internet was not according to consulting firm McKinsey exceeding US$ 500, which earlier hov- considered a choice for finding a life & Co. As per the IAMAI-KPMG report, ered in the range of US$ 40–100. partner. It became one of the choices an estimated 828 million Indians will According to agency reports, in around five years back. Today, it is the be below the age of 35 in 2015, with 2013, e-commerce business rose by primary choice for someone looking high disposable incomes and a willing- more than 80 per cent and the growth for a life partner,” he says. Janakiraman ness to shop online. More than half momentum will most likely continue is confident that with users connected of the total 1.2 billion population of for the next five to six years. Some to the 3G and 4G networks throughout India falls in the below 25 years of age forecasts are putting the e-commerce the day, mobiles will create better facili- bracket. Also, 65 per cent of India’s growth figure in the range of US$ tation of services for companies like his. population, representing the working 50–70 billion by 2020, piggybacking a age group of 15 to 64 years, would aid fast improving ecosystem of enablers. Enabling Ecosystem the further growth of e-commerce, driv- Murugavel Janakiraman, Founder & Smartphones would be the biggest driv-

www.ibef.org | april-may 2014 21 cover story E-commerce market

2013. The IAMAI-KPMG report puts an internet penetration of 25 per cent as the tipping point for e-commerce growth. Convergence Catalyst, a research firm, found that smartphone sales in “The advent of other mobile India in 2013 almost doubled to reach devices such as tablets and 41–43 million units with monthly sales crossing four million units for the phablets, and increased inter- first time in the December quarter. net penetration has created In September 2013, Avendus Capital Pranay Chulet numerous new opportunities CEO and Founder forecast that smartphone penetration for e-commerce players in the Quikr in India would touch 382 million by 2016 while research firm International Indian market. Many e-com- Data Corp (IDC) predicted that 155.6 merce players are realising that million smartphones would be shipped a one size fits all strategy will not to India in 2016 alone. work and we now need to ‘think Mobile phones are proving to be an important factor in the e-commerce mobile’ rather than ‘adapting for ecosystem owing to their easy compat- mobile’ and ‘mobile only’ rather ibility with the internet. India has than ‘mobile first’.” more than 900 million mobile users, of which around 300 million use data services. This number is expected to touch 1.2 billion by 2015. Also, more than 100 million additional mobile users are expected to use 3G and 4G connectivity in the coming few years. ers of growth of online shopping in the go down in the years to come,” says Of the total 900 million mobile users, coming years. India outstripped Japan Manasi Yadav, Senior Market Analyst, a meager 27 million are active on the to become the world’s third largest Mobile Phones and Tablets, IDC India. internet. Moreover, only 4 per cent of smartphone market in the first quarter Pranay Chulet, CEO and Founder, the active mobile internet users buy of 2013. A report by market research Quikr, finds, “The advent of other products through mobiles. However, firm Mediacells says that India, whose mobile devices such as tablets and mobile shopping is on the upswing and consumer base is expected to reach 364 phablets, increased internet penetra- is expected to increase five fold to 20 million in 2014, will surpass the US in tion has created numerous new oppor- per cent in the medium term. smartphone usage by year end. As per tunities for e-commerce players in Manmohan Agarwal, CEO, Yebhi. the report, India and China alone will the Indian market. Many e-commerce com has been watching this trend purchase roughly half a billion smart- players are realising that a one size closely too: “One of the top current phones in 2014, accounting for half of fits all strategy will not work and we trends of e-commerce is the steady shift the total smartphone purchases across now need to ‘think mobile’ rather than towards m-commerce. With a mobile 47 nations in the year. India will see ‘adapting for mobile’ and ‘mobile only’ customer base of 951 million Indians, sales of 225 million smartphones, add rather than ‘mobile first’.” Chulet’s portals are expanding and developing 207 million new smartphone users and observations are based on an IAMAI their mobile presence too. Reports have the smartphone population will double and IMRB International report that indicated that 87 million Indians prefer from 156 million to 364 million in 2014. internet usage in rural areas had accessing online shopping through “There is a lot of potential in the reached 68 million in October 2013 their smart phones. Yebhi.com is smartphone market as there are huge and was estimated to cross 72 million constantly working towards enhancing numbers of consumers waiting to by the end of 2013. This report also its mobile phone capabilities so that migrate from feature phones to smart- observed that the 110 million monthly more shoppers are encouraged to shop phones. If you look at the market, 81 per user base that was accessing the online with us. Currently, we are enter- cent of mobile consumers use feature internet through mobiles at the time taining 35 per cent traffic from mobile phones and that percentage is set to would rise to 130 million by the end of phones, of which 2 per cent converts to

22 april-may 2014 | www.ibef.org E-commerce market cover story

sales.” Investors are looking for good entrepre- Inc. launched its India website in June Seeing the opportunities for e-com- neurs and if you are in the market with 2013 and Walmart and eBay are also in merce, investors are willing to bet big a good idea, people are willing to invest the reckoning for a piece of the action. on startups in the space. Flipkart has in your startup. There is still a long Much is anticipated in the online raised nearly US$ 550 million since way to go before we match the scale of marketing space with an estimated 16 2009 from venture capitalists like Tiger Silicon Valley in the West, but the good per cent of disposable income of young Global, Accel Partners, Iconiq Capital thing is that the first few steps have Indians being spent online. and Naspers Group. In 2013-14, Flipkart already been taken in that direction,” The e-commerce horizon has wid- raised US$ 360 million from existing he says. ened owing to acceptance of online investors Tiger Global Management Llc, According to media reports, in the shopping as a safe shopping medium. Accel Partners and Iconiq Capital, and first quarter of calendar year 2014, 10 Of the total 200 million credit and MIH (a part of South African media transactions worth US$ 288 million debit card holders, just about 10 mil- company Naspers Group); this is the took place in the e-commerce space. lion people transact online, indicating largest investment in online retail in Online retailer Jabong.com raised a huge untapped market. A First Data India thus far. Flipkart though has out- approximately US$ 100 million from Corporation and ICICI Merchant stripped any competition in the space CDC Group PLC, a UK government- Services report showed that there are having crossed the magical one billion backed private equity fund-of-funds around 150 million users who are will- dollar gross merchandising value. that invests in some emerging markets ing to shop online. Players like Jankiraman are also find- and Myntra.com raised US$ 50 million. Ankur Warikoo, CEO, Groupon India, ing the going good. “The ecosystem Meanwhile, foreign players who had says, “Indian consumers who were for Indian entrepreneurs has changed been eyeing a slice of the e-commerce earlier apprehensive about shopping drastically over the past few years. pie have joined the party. Amazon.com online are now browsing more often

Women Influenced GMV

US$ 3 bn/24x 1. Working women segment grew 43% in 2013 and constitutes nearly 10% of active internet users in India according to 26% of market i-Cube & IAMAI 15% of 35% of 2. Catagories like baby care, home decor, market market jewellery, etc., have traditionally been US$ 511 influenced by women decision makers. mn / 4x As more choices become available more US$ 122 women are shopping online. mn / 1x

2012 2013 2016P

Women spend 40% more time on Women spend 60% more time on Women spend upto 30% more time on fashion sites jewellery sites than men luxury sites than on home furnishing

1.3x 1.1x 1.0x

Male Female Male Female Luxury/Jewellery Apparel Home Furnishings

Source: Accel India

www.ibef.org | april-may 2014 23 cover story E-commerce market

to make high value purchases and barrier,” explains Chulet. He says there innovations will continue to focus on avail experiential offers.” He cites a are a number of players in the market better usability of the e-commerce ComScore report of December 2013 to who have their own unique ways of platform as well as ways and means prove his point.“The daily deal websites reaching out to customers. to get the products to the customers comprise India’s fastest growing web Such innovative approach helps faster. These innovations will also serve vertical. The coupon business is 13.5 per companies tap the equal opportuni- the frugal customers, meaning the cent of the total e-commerce audience ties offered by rural India in the huge masses that don’t have access to in India, growing at the rate of 62.9 per e-commerce space. The unavailability smartphones or computers. Several cent with 7.6 million unique users a of attractive offline channels in under- companies are already finding ways month,” he says, quoting the report. developed cities has encouraged the to reach these customers. Innova- Groupon entered the India market brand aware population to shop online. tions will continue to focus on social in 2011 and it is today the fastest grow- Around 3,311 Indian cities were engaged platforms and ways to smartly engage ing among its 48 markets. “We have in online shopping between July 2010 them to generate more e-commerce grown tremendously to reach the No.1 and June 2011, of which over 1,267 were transactions.” rank in the daily deals category (as per non metro cities. This reflects how With hundreds of players in the ComScore data). We have seen a lot of e-commerce has helped in overcoming online space, there is a need for traction from customers and our repeat the discrimination factor across cities, e-tailers to constantly innovate in order

Exhibit 1 Exhibit 2 Growth of e-commerce market in India (US$ bn) Segment information

15.00 B2B: Transactions B2C: Transactions between two or more between companies and 10.00 companies customers CAGR 54.6% Types 5.00 C2C: Transactions C2B: Transactions 0.00 between two or more 2007 2008 2009 2010 2011 between companies and private individuals or customers consumers Source: IAMAI, Aranca Research Source: Aranca Research

purchase rate is 48 per cent.” facilitating access for consumers from to capture a larger pie of the growing smaller towns to the same branded and e-commerce market. Players like Innovation is the Key quality products which earlier were a Flipkart have frequently been adding Quikr India Pvt Ltd, that raised distant dream. Companies are working to their product portfolio to expand the US$ 90 million from Investment AB towards providing more online content net of their customers. Snapdeal began Kinnevik of Sweden, will be utilis- in regional languages to tap the niche operations as an online group discount- ing the funds for marketing, talent consumer base. ing site in 2010 and later converted acquisition and improving customer Neetu Bhatia, Co-founder and CEO, into a marketplace with thousands of experience. The online player has been KyaZoonga, not only points to the products to broaden its consumer base. quick to adapt its offerings to Indian need for innovation in the e-commerce Yebhi reinvented itself to tap the expectations in what Chulet calls “local space but like Chulet, she too finds enlarging online marketplace. Agarwal, innovation.” It has a missed call service the Indian e-commerce space a hub of talking about the portal’s model says, where prospective users of the online innovation. “India has already seen the “We started out as Big Shoe Bazaar classifieds platform can give the contact advent of innovative features such as in 2009, and in 2010, with the core centre a missed call. The company cash on delivery and other innovations management deciding to venture into representatives call them back, taking in the e-commerce business model. lifestyle horizontal, we expanded into down the details and posting the ad for Technologically, given India’s large other categories like apparels, acces- the user. “This approach combats both engineering and IT landscape, there is sories, home and electronics, under computer illiteracy and the language a lot of potential for innovation. Most the name Yebhi.com.” Currently, Yebhi.

24 april-may 2014 | www.ibef.org E-commerce market cover story

com offers shoppers a choice of more credit/debit card details. It is believed A Business Imperative than 500 brands and runs on 85 per that more than 50 per cent of all online Kunal Bahl, Co-founder and CEO, cent assisted marketplace model and 15 transactions in India are based on the Snapdeal, calls e-commerce “a curi- per cent pure play marketplace model. COD payment methodology. As Indian ous experiment that has grown to With a 1,00,000 lakh sq ft warehouse consumers are showing increased a full-fledged business reality and called Fulfillment Centre, Agarwal says, interests in the COD mode of payment, opportunity” in the last five years. His “It is our distribition network which companies are investing to resolve company is a testimony to this growth ensures systematic inventory, quality issues such as refusal to pay cash, ris- story. Among the largest online mar- check, storage and dispatch. We have ing inventories and managing returns ketplaces in Indian online space, it is catalogues for cross border and we are in order to provide this facility without raising US$ 133.7 million from existing in international space. We get orders hassles. Yebhi introduced innovations investors, including eBay Inc. from UK/US, Europe and others.” like One Click Return, wallet and In 2013, the e-commerce sector Companies have introduced return videos to increase traffic on its portal. saw 57 deals worth US$ 602 million. policies ranging from 7–30 days, free Agarwal says, “Internet buying is a face- Investments in e-commerce firms home delivery and the cash on delivery less transaction but customers need rose 258.31 per cent to US$ 805.36 (COD) model. The last innovation has someone to trust. Here lies great busi- million in 2013-14 from US$224.85 led to a lot of momentum in internet ness opportunity for all e-commerce million in 2012. The sector enjoyed sales and changed people’s perception firms to realise their potential by ensur- inflow of around US$ 800 million in of online shopping as shoppers can ing customers’ needs and preferences 2011, up from US$ 110 million in 2010. now purchase without disclosing their are met simply and efficiently.” Investments made in e-commerce businesses by PE firms alone more than quadrupled to US$ 467 million in 2011 compared to US$ 99 million in 2010. The number of deals increased to 78 compared to just 22 in 2010. The robust deal activity continued in 2012, with US$ 242 million invested during the January–April period. The trend over the period reflects that the average “India has already seen the deal size has more than doubled due advent of innovative features to increasing traction in e-commerce activities, which requires larger invest- such as cash on delivery and ments for growth. other innovations in the e-com- The FY14 has opened on a grand Neetu Bhatia merce business model. Tech- Co-founder and CEO note for the e-commerce sector with nologically, given India’s large KyaZoonga the mother of all deals being signed between two giants in the space. In engineering and IT landscape, the largest consolidation exercise in there is a lot of potential for e-commerce, Flipkart’s Sachin Bansal innovation. Most innovations and Binny Bansal bought out Mukesh will continue to focus on bet- Bansal’s Myntra. The combined entity now pegged at US$ 2 billion is said ter usability of the e-commerce to be an attempt to counter growing platform as well as ways and competition from the US online major means to get the products to the Amazon. The reason for the bulking e-com- customers faster...will also serve merce bandwagon is not only the ease the frugal customers, meaning of doing business but also a business the huge masses that don’t have imperative, according to Bahl. “The access to smartphones.” marketplace model is indeed a more profitable and scalable form of commerce for digital players in India. It offers significantly higher competitive

www.ibef.org | april-may 2014 25 cover story E-commerce market

e-commerce, what is often overlooked is the B2B aspect of e-commerce. For fledgling entrepreneurs and small businesses, online classifieds sites such as Quikr act as a nursery of Indian e-commerce. Setting up a brick and mortar business with efficient delivery “Indian consumers who were models to attract a dedicated customer earlier apprehensive about shop- base can mean a lot of capital infusion ping online are now browsing for MSMEs. Various online platforms more often to make high value are providing these entrepreneurs with Ankur Warikoo a channel with high margins and zero purchases and avail experiential CEO, Groupon India upfront investments as their market- offers. The daily deal websites ing outlay reduces significantly and comprise India’s fastest grow- in some cases, they have to pay only upon a successful transaction.” With so ing web vertical. The coupon many new businesses entering the fray, business is 13.5 per cent of the there is much opportunity for investors. total e-commerce audience in E-commerce will be attracting the bulk India, growing at the rate of 62.9 of private equity and venture capital investments for the next few years as per cent with 7.6 million unique more sectors join the online bandwagon users a month.” even as there will be consolidation by companies to gain depth. Companies like Evermorestores.com, a soon-to-be-launched e-commerce portal, will be looking for investors to back their unique business ideas. Jasminder advantages to players in the digital world, it is now critical that these SMBs Singh Sikka, Proprietor, Evermorestores. commerce space as compared to the reach out to a wider audience. They com, is not the usual young tech savvy conventional inventory based e-tailing face the challenges of logistics and e-commerce entrepreneur. Sikka says, model. The model being inventory retail infrastructure, limited computer “E-commerce business can be started light allows the players to not only expertise (only about four million with as small an amount as `25,000 expand the range of their product offer- SMBs in the country use PCs in (US$ 420.24). There are e-commerce ings beyond a fixed set of brands/mer- India), inadequate working capital, low development agencies. These are mall- chants but also significantly cuts down marketing expertise, and geographic type online agencies. You don’t even customer acquisition cost,” he says. bottlenecks in doing so. need a portal and you can still be a part Explaining why e-commerce is a Bahl says digital commerce or the of it. They will promote your products necessity in India, Bahl argues, “Only 5 online bazaar provides a way out for and that can be cheaper. This is a new per cent of the US$ 600 billion Indian these SMBs. “By providing low cost yet concept in India. However, if you have retail industry is organised (Source: effective solutions, online marketplaces a complete portal designed for your The Indian Kaleidoscope: Emerging trends in India can help out a multitude of website, then it is expensive.” in Retail, PwC). This unorganised and Indian retailers who don’t have the Sikka, who entered the corporate fragmented industry faces unique resources or the know-how to market gifting business in 1994, always wanted issues of reach and marketing nation- their products and services.” to be online, “but didn’t know what ally.” Success in the marketplace model it was”. His journey into e-commerce India is home to 50 million small depends on how effective the platform started with a book that his friend and medium business (SMB) units is in: a) reaching out to the target audi- ordered for him. “This book was on that account for more than one third ence (building demand); and b) bring- a 24-25-year-old guy who was into of the country’s GDP. Only 10 million ing the best of sellers and their products online trade and had made a name for of them are technology ready (Source: onto the platform (creating supply). himself.” Zinnov). In order to sustain their busi- Chulet too agrees with Bahl. “Apart Sikka has infused `50–60 lakh (US$ nesses in the increasingly competitive from the obvious B2C element of 84,047.74–100,857.29) in his startup

26 april-may 2014 | www.ibef.org E-commerce Market cover story

Exhibit 3 Exhibit 4 5% 2% Growth in Internet users versus e-commerce market Components of e-commerce 6% 150% market—2012

Online Travel 100% 16% E-tailing

50% Financial Services

0% Classifieds 2008 2009 2010 2011 71% Internet users growth E-commerce market growth Other Online Services

Source: World Bank, IAMAI, Aranca Research Source: IMRB International

and knows that to succeed in the online note here is the fact that online retail sales uses technology to access information, marketplace “One has to be different. have been growing faster. As per the Crisil products and services that enhance life. It’s one thing for sure. There has to be report, revenue of e-commerce firms Thanks to the growth in our industry something that excites the person.” grew by 56 per cent annually between (e-commerce), a person in a village Currently, the retail division, which fiscal year 2008–13. in India connected to the internet has includes online sales of physical and access to the highest quality products digital goods, enjoys only a nominal share. The Tide is Turning delivered at his or her doorstep. In fact, Notably, in this division, e-tailing is the With such buoyancy visible in the today at HealthKart, we see one-third of fastest growing segment capturing 16 per sector, Prashant Tandon, MD & Co- our transactions come from 500 small cent of the market as per IMRB Interna- founder, Healthkart, is bang on target towns and villages that constitute the tional’s statistics of 2012. According to when he says they have reasons to Tier IV towns and rural parts of India.” a Crisil report, online retail companies be optimistic about the e-commerce Agarwal finds the Indian online earned revenues of around US$2.24 bil- growth story. “The fundamental India consumers “aspirational as the demo- lion in the financial year ended on March story is on track. The Indian consumer graphic setup creates lack of acces- 31, 2013. This may be just 0.5 per cent is demanding quality and is willing to sibility of the products of their choice.” of the total revenues of the fixed format pay for value. The consumer is now Online space provides them a platform retail companies, but what is important to more aware, more connected and with reach to all products at their own convenience, he says. Bhatia finds a large urban bias in the current e-commerce market but Exhibit 5 foresees it spanning a wider platform Users by modes to access Internet (%): Internet usage through mobile phones to grow in the near future. “The market cur-

120% rently has a significant urban bias but with improved connectivity and higher 0% 0% 0% 0% 100% smartphone penetration, the immense 9% 36% 36% 37% 34% potential of Tier II and Tier III cities is 27% 80% 43% being realised. Features such as COD 58% 67% 73% are helping a lot of nervous consum- 60% ers get their feet wet and comfortable 26% 23% 19% 30% 37% 32% with transacting online. This growth 40% 13% is expected to see a lot of new com- 9% 24% 7% panies jumping onto the bandwagon 20% 34% 38% 40% 19% 16% 29% 32% 14% to capture a share of the pie. While 14% 10% 8% 6% we believe the market has enough 0% 2007 2008 2009 2010 2011 2012 2013 2014 2015 space for healthy competition, in the Work Home Cyber cafe Mobile medium term we expect the industry Source: World Bank, IAMAI, Aranca Research to see consolidation. Based on our very own experience where we have

www.ibef.org | april-may 2014 27 cover story E-commerce market

broken all records in ticket sales online in Tier II and III cities (over 90 per cent transacted online in cities such as Indore, Raipur, and year on year massive increases in online transactions in places such as Mohali, Pune, Vizag, etc.), we see massive potential,” he says. “The marketplace model is indeed Agarwal too agrees. “With the internet population poised to reach 500 million a more profitable and scalable there is huge headroom for growth of form of commerce for digital play- e-commerce in India. Another growing ers in India. It offers significantly trend is the increasing traction received Kunal Bahl higher competitive advantages from Tier II and III markets where lies Co-founder and CEO Snapdeal a large base of untapped customers to players in the digital com- that has the access to money but not merce space as compared to too many options.” Yebhi is witnessing the conventional inventory based almost 50 per cent of traffic from non- metro locations. “Our strongest hubs e-tailing model. The model being are Pune, Chandigarh, Ahmedabad, inventory light allows the players Jaipur and Indore,” he adds. to not only expand the range of Tandon says, “This is when the inter- their product offerings... beyond net penetration and awareness is pretty low—driven purely by a need across a fixed set of brands/merchants this untapped demographic. Just imag- but also significantly cuts down ine the economic boom that is coming customer acquisition cost.” once these places get more connected— suddenly 70 per cent of the Indian population would be brought into the mainstream! And we see that happen every day—it is no longer a story 10 by internet through smartphone.” improvement in productivity and years away—I expect the landscape to Across the value chain, there will be efficiency, he says. “From distributors, fundamentally and disruptively change enhanced penetration of technology manufacturers, warehousing compa- in just a couple of years, largely driven and thereby a clear and sustained nies, logistic providers to the regulator and the government agencies, we see a greater push towards streamlining systems and processes, largely through Exhibit 6 use of latest technology tools. Soon all Private equity investments in e-commerce these are going to not just add up, but 500 100 78 benefits will multiply across the ecosystem,” Tandon is confident. 400 80 With a solid demographic story, a fast evolving backend infrastructure 300 60 and the inevitability of mobile internet 30 connecting the hitherto inaccessible 39 masses, one can understand Tandon’s 200 40 25 27 28 excitement at the prospect of participat- 22 ing in probably the “biggest economic 100 20 story the world would see”. Indian retail consumers’ “can’t touch, won’t 0 0 buy” mentality is finally changing. 2006 2007 2008 2009 2010 2011 2012 (till April) Deal value (in US$ million) Average deal size Number of deals (Source: Interviews conducted over a period Source: World Bank, IAMAI, Aranca Research of time & secondary research)

28 april-may 2014 | www.ibef.org xxxxxxg india cover story

www.ibef.org | april-may 2014 29 Emerging Entrepreneurs Portea Medical

30 april-may 2014 | www.ibef.org www.ibef.org | april-may 2014 31 Portea Medical Emerging Entrepreneurs HealthTurning Wealthto In their fifth serial venture, the Bengaluru- award in 2012. Founder and CEO of Portea Medical, based entrepreneur couple K Ganesh Meena Ganesh, till February 2013, was and Meena Ganesh displays their the promoter and board member of TutorVista and CEO and MD of Pear- Midas touch yet again. In less than a son Education Services, which includes innovative and successful brands like year of entering a rather new avenue of TutorVista, leading online tutoring business—home healthcare—they have company, and Edurite, provider of technology based solutions and digital once again created a template for startup content. The Ganeshes are actively involved success..By Payam Sudhakaran in incubating startups and are strategic investors/promoters of India based t’s an inspiring story of entre- ingly, Forbes rated Portea among the top consumer internet and e-commerce preneurial excellence. When five startups to watch out for in 2014. companies Bluestone.com (online two young and extraordinary With `48 crore (US$ 8 million) from jewellery), Bigbasket.com (e-grocery), minds come together in the Accel Partners and Ventureast, Portea is MustseeIndia.com (travel packages extremely challenging world currently operational in 12 cities across and content), bookadda.com (academic Iof multi-crore businesses, they set India. Its Chairman, K Ganesh, is a focused online books), delyver.com examples, draft numerous stories of serial entrepreneur with four success- (hyper local delivery), and onlineprasad. success and become role models for ful greenfield ventures and exits. His com (online religion). Portea Medical many aspiring businessmen. last venture, TutorVista was acquired is India’s home healthcare pioneer. And that is exactly the story of Portea by US and UK listed education leader They established Portea along with Dr Medical, a firm that aims to provide Pearson for US$ 213 million. He was Manjusha Anumolu, MD (US Board technology led home healthcare ser- among the top five nominees for the Certified) in Internal Medicine with 20 vices to the Indian consumer. Interest- Economic Times Entrepreneur of the Year years of practice in US and India.

30 april-may 2014 | www.ibef.org www.ibef.org | april-may 2014 31 Emerging Entrepreneurs Portea Medical

Portea, Ganesh’s fifth venture, and focuses on geriatric, chronic and Ganesh also has a degree in mechanical operates in Delhi/NCR, Bengaluru, post operative care patients using latest engineering from Delhi University. It Chennai, Mumbai, Hyderabad, Pune, technology and tools to make health- was apparent to the duo that theirs was Kolkata, Jaipur, Lucknow, Chandigarh, care delivery convenient and affordable. not an isolated case. “We saw the need Coimbatore and Ahmedabad. The “Our involvement with Portea Medical for affordable, quality home healthcare company offers home visits by doctors, resulted from a deeply personal experi- was universal. There was a genuine nurses, physiotherapists, nutritionists, ence. A close family member was diag- dearth of options for quality medical counsellors, and trained attendants nosed with cancer and I saw firsthand, care at home in India. We were confi- the difficulties in taking care of a termi- dent of building a category leader in the nally ill person. My wife, Meena, and I, sector,” Ganesh says. “Our vision is to ensure realised the many challenges involved Meena adds, “Our thinking is that that these services and the dearth of options for quality India is still a great country to invest in. medical care at home in India. This was The domestic market is huge and com- are provided with also the time when we had just exited pletely untapped and the potential is now great compassion and our previous venture TutorVista, and even greater than it ever was! The excel- were exploring various opportunities. lent startup story with great outcomes empathy so that in We found that the lack of affordable and like JustDial, TutorVista, Redbus shows your moment of need, quality home healthcare in India was people can start a greenfield, scale, cre- you know that you are a big pain point and provided a large ate value and exit and more importantly ‘whitespace’ opportunity that we felt we create lasting institutions that world’s top being taken care of...” could address,” says Ganesh about the companies will love and want.” inspiration behind Portea. According to them, the current K Ganesh Chairman, Portea Medical “Portea Medical believes in bringing healthcare options in India do not offer to customers’ homes affordable medi- sufficient convenient and cost effective cal services of the highest quality. Our options. Healthcare delivery is also vision is to ensure that these services constrained in many ways by distance to are provided with great compassion healthcare facilities and the lack of time. and empathy so that in your moment Travelling all the way to hospital and of need, you know that you are waiting in a queue for a procedure or being taken care of by the very best consultation that often takes a few min- professionals, who use their skill utes seems illogical and is inconvenient, and their heart, to assist you,” especially for the elderly and infirm. he explains. Today, home healthcare is a US$ 3 bil- When asked if this was lion/year segment in India and is set to a new avenue in medical grow rapidly. The opportunity is large care, Ganesh says, “Home and attractive and being driven by: healthcare has been in a) the large Indian population and existence in the US for a growing population of elderly (by more than a century. 2025, one in every five Indians will be a In Europe, countries senior citizen); like the UK have an b) rise in chronic ailments (which established model of account for 53 per cent of the deaths in in-home healthcare. India) that need to be treated; In that sense, the busi- c) longevity of the population—dis- ness is not completely ease management is required over new; however, it has longer periods of time due to longer never been attempted lifespans, and earlier disease detection; before in India at the d) lack of an organised, high quality scale at which we are national player in the space. operating and expand- The couple also point to the existing ing to.” A postgraduate challenges in the home healthcare from the Indian Institute sector. For instance, it’s a fragmented of Management, Calcutta, space with several players offering vari-

32 april-may 2014 | www.ibef.org www.ibef.org | april-may 2014 33 Portea Medical Emerging Entrepreneurs

“Our thinking is that India is still a great country to invest in. The domestic market is huge and completely untapped and the potential is now even greater than it was!”

Meena Ganesh Founder & CEO, Portea Medical

ous slivers of services; it needs large vitals, lipid profile, ECG, sugar capital and is complex to execute and and other vitals checked every rigorous systems and processes need to three months, and a nursing be in place to be able to deliver consis- attendant accompanying the tently high quality. patient on hospital visits as and Though refusing to divulge the com- when needed. Physiotherapy is pany’s turnover, Ganesh says, “We do another major thrust area for not make company financials public Portea services. There are care but just to give you an idea of our oper- plans for diabetes and hyperten- ations: Portea handles 9,000–10,000 sion patients as well. visits a month across India. We current- Portea also offers medical equip- ly employ 600+ staff and are recruiting ment on rent such as oxygen con- rapidly to support our growth.” centrators, pulse oximeters, bi-level/ Portea has a robust set of operational continuous positive airway pressure processes to ensure the best possible devices, suction machines, multi- patient experience. With field staff parameter monitors, wheelchairs, walk- strength running into hundreds, sched- ers, hospital beds and air mattresses. In ules need to be meticulously coordinat- addition, home delivery of medicines ed and supervised; the staff needs to be and collection of samples for lab tests provided logistics and technology sup- are arranged. port and care plans need to be designed. The funding from venture capital manage the entire Further, inputs from the specialists firms, Accel Partners and Ventureast, delivery remotely treating the patients must be factored the largest ever Series A VC investment and scalably. Portea staff into the treatment plan. “The bottom in a home healthcare company in India, carry handheld devices when they visit line in this business is people—ade- in late 2013, has the company hoping patients' homes. The Portea app helps quately supported by robust systems, for more fund infusion for their plans. clinicians access the patient's medical processes and technology to capture, “We are looking forward to raise anoth- history, check instructions from the consolidate and present information, so er US$ 30–40 million in this fiscal to patient's specialist and provide real- that appropriate action can be taken on fund further expansion,” says Ganesh. time update of data from the patient. an ongoing basis,” adds Meena. Portea “Portea is expanding aggressively. We will also implement a system where focusses on general primary healthcare, From one city eight months ago, we data like blood pressure, temperature post hospitalisation care, and chronic are now present in 12 cities with more and sugar levels are automatically disease management and allied servic- cities being added to our network. The captured. The idea is to ensure that es. It offers care plans addressing vari- intention is to cover the top 50 cities in patients need not go to hospitals but the ous aspects in all areas including doctor India which have a population of over 1 entire gamut of healthcare is brought to visits, nurse visits, nursing attendants million. We are recruiting aggressively. their doorstep—doctors, nurses, phys- (12/24 hours a day), and patient activi- Tie-ups with leading hospital chains are iotherapy, diagnostics and medicines,” ties of daily living (ADL)–grooming, on in order to extend the continuum of Ganesh says.“But, these are really on brushing, bedcare, etc. care for their patients at home,” Meena the business side of things—more Its annual elder care plan (managed explains the strategy. important for us is to continue to make care) includes a general health check at The edge to Portea’s services is provid- a positive difference in the lives of the the start, a doctor visit every month, a ed by its technology interface. “We have patients and families that we serve,” the nurse visit every fortnight to measure developed proprietary technology to dynamic entrepreneurs sign off.

32 april-may 2014 | www.ibef.org www.ibef.org | april-may 2014 33 Features Inside Policy Success: Insurance taps new opportunities. Pg 38

Thirsting for Success: Sectoral The water sector opens up investment avenues. Pg 41 Raring to Go: Business aviation spreads its wings update across Indian skies. Pg 45

Building Awareness: Indian companies have unleashed a marketing bleitzkreig to train farmers in the right use of agrochemicals. photo by th i nkstockphotos. n Agrochemicals The Right Growth Input The industry looks at growing domestically on the back of strong export. by sangita thakur varma

34 april-may 2014 | www.ibef.org Agrochemicals sectoral update

he Indian agrochemicals story is one of global suc- “India is a leading producer cess underpinning a ris- of pesticides in Asia with ing domestic demand. In 2012, the agrichemicals or over 400 million acres Tthe crop protection market was valued under cultivation...(in) supply at US$ 3.8 billion. Exports constituted about 50 per cent of the crop protection of pesticides, India ranks market with the forecasts indicating fourth globally...indicating further growth at approximately 12 per the significance... cent per annum to reach US$ 6.8 bil- ” lion by FY17. —Ankur Gupta Head Marketing The spurt in the agrochemicals sec- Ken Research tor’s growth though is largely expected to come from export demand which is estimated to grow at 15–16 per cent Dhanuka makes a strong case to ticides in agricultural practices in the per annum. Pesticide exports have minimise crop losses due to pests and country is also increasing.” been witnessing healthy traction over diseases by increasing use of crop pro- Defining agrochemicals, Gupta says, the past few years. India continues to tection chemicals, as there is need for “They refer to a broad range of pesti- maintain its position as the net export- more food to feed the increasing popu- cides including insecticides, herbicides, er of pesticides in the world. Some lation. “Rising income of middle class fungicides, biopesticides, plant growth of the major agrochemicals exported has resulted in increasing demand for regulators and rodenticides. Agro- from India over the years include food. Even as the population of the chemical or agrichemical is fundamen- isoproturon, endosulphan, alumini- country is increasing, arable land is tally an agricultural chemical, a generic umphosphide, mancozeb, cyperme- shrinking due to increasing urbanisa- term for chemical based agricultural thrin, thiomethaxam, and imidacloprid. tion,” he reasons. products or can be termed as chemical Insecticides and herbicides are the two Pesticide usage has played a domi- compounds used for crop protection.” largest contributors to pesticide exports nant role in controlling pests in the Growing environmental awareness from India. Indian agriculture system for many has led to the development of eco- Driven by rising domestic consump- years, explains Gupta, adding, “As the friendly measures of crop protection. tion, domestic demand is also expected cropping pattern in India is becoming “In this regard, the consumption of to rise at 8–9 per cent per annum. more intensive, the use of these pes- biopesticides has shown significant According to Ankur Gupta, Head of progress as witnessed over the past few Marketing, Ken Research, “India is a years. The application of biopesticides leading producer of pesticides in Asia India Pesticides Market has been gaining traction on a global with over 400 million acres under Segmentation FY’ 2013 platform for controlling insect pests cultivation and over 60 per cent of the and diseases in the farm field,” informs country’s economy dependent on the Generic Patented Gupta. agricultural sector. In terms of the sup- Some swiftly budding market seg- ply of pesticides, India ranks fourth 28.6% ments in the biopesticides space globally after the US, Japan and China, include bioinsecticides, biofungicides thereby indicating the significance of and bionematicides. “The contribution agrochemical industries in India.” of biopesticides in the Indian pesticides Mahendra Kumar Dhanuka, Manag- market has witnessed stupendous ing Director, Dhanuka Agritech Limited, growth in revenue terms; the segment finds the going bright for the sector. has recorded growth in its share from “There is huge growth opportunity in the 2.1 per cent in FY07 to 4.8 per cent sector, as the consumption of crop pro- in FY13. The revenue contribution of tection chemicals in India is one of the biopesticides has witnessed growth at a lowest in the world. Only one third of the 71.4% relatively high CAGR of 26.4 per cent. farmers in India use agrochemicals.” Source: Ken Research Organic farming is another important

www.ibef.org | april-may 2014 35 sectoral update Agrochemicals

Average Consumption of Pesticides in India pesticides is estimated to be around US$ 17 billion annually. According to Compared with Other Countries across the Ken Research estimates, nearly 30 per Globe, 2012 cent of potential crops in India are lost to insects, weeds and rodent attacks. Korea “Because only 35 per cent to 40 per cent 10.8 of the total farmland in India is under Japan 10.8 pesticide treatment, there is a significant proportion of the market in India US 4.5 which is left underserved,” says Gupta. North America, European Union Others 3.0 and Asia Pacific are among the world’s highest consumers of agrochemicals, Europe 3.0 consuming 75 per cent of the total pro- India 0.6 duction. Dhanuka is happy though at the 0.0 5.0 10.0 15.0 20.0 increasing awareness amongst farmers (only 25–30 per cent of the farmers are Kg/Ha Source: Ken Research currently aware of agrochemical products and their usage) about the correct usage and cost benefit analysis of using market trend that has provided signifi- protection chemicals in the world, at plant protection chemicals, through cant impetus to the market,” Gupta ~0.5 kg per hectare (world average is 3 on-ground efforts of agrichemicals shares some statistics. On the whole, kg/ha). It is estimated that India can companies. the crop protection industry in India save additional `3 lakh crore (US$ 5.12 As a corollary, with increasing has been displaying changing dynam- billion) per annum by adopting assured awareness of farmers, rising incomes, ics, with herbicides and biopesticides plant protection coverage,” Dhanuka availability of better irrigation alterna- showcasing swift growth as compared says. The crop loss due to non-use of tives and lessening dependence on to insecticides and fungicides as wit- monsoon, government initiatives, self- nessed over the last few years, he adds. sufficiency in foodgrains, scientifically Dhanuka also insists on the need for advanced and effective plant protec- promotion of crop protection practices tion products and other conducive to save meagre resources. Food secu- Developments and factors, the plant protection chemicals rity and sustainability concerns have Milestones industry is growing at a rapid pace. The become much more severe today than consumption of pesticides in India, ever before, as the country is facing l Remarkable growth in terms of although low, has thus been gaining a several serious challenges for augment- volume of pesticides produced over strong foothold. ing its foodgrain production. India the last seven years The Indian pesticides market is lags behind the world average in yield l India is the fourth largest producer of majorly held by generic products. In per hectare in many important crops. pesticides in the world recent years, most Indian technical “Despite large areas under cultivation of l Industry is undergoing wide ranging manufacturers in the country have paddy and wheat, we lag behind in total transformation including increased been focusing on off patent pesticides. production. Insects, fungus and weeds role of MNCs, joint ventures of Indian The Indian agrichemical industry is destroy crops worth billions of dollars companies with multinational pesti- capital intensive and highly regulated. annually,” he emphasises. cides companies and consolidations It is mainly composed of technical He attributes this to many reasons, l Inclining demand for organic food grade manufacturers who usually sell including lack of usage of plant pro- l synthetic chemicals will continue to premium quality chemicals in bulk to tection chemicals, which results in rule in the chemical pesticide market the formulators, who then prepare for- massive crop wastage due to various mulations by mixing the carriers, sol- pests and diseases. “India has one of vents, surface active agents and other the lowest consumption levels of plant Source: Ken Research relevant compounds.

36 april-may 2014 | www.ibef.org Agrochemicals sectoral update

In the chemicals sector, the government allows 100 per cent FDI. Bayer, BASF, DuPont, Monsanto, Cheminova, Investment Syngenta, Makteshim, Isagro and Sum- Opportunities itomo are some of the leading foreign players in the space. l the low consumption of agro chemical products Explaining the dominance of foreign in India accounting for only 0.58 kg/hectare companies in the space, Gupta says, relative to the world average of 3 kg/hectare “One of the greatest challenges that indicates immense growth potential for the pesti- Indian pesticides companies face in cides business in India in the coming years capturing a greater patented market is l the share of bio-pesticides segment which pres- the registration of the product because ently forms 4.8% of the total market is expected of the high cost of registration in the to grow to nearly 9.3% in next five years US.” l the availability of inexpensive labour and low Availability of cheap labour and low cost of processing processing costs offers opportunity for l opportunities in horticulture and floriculture sup- MNCs to set up manufacturing hubs porting demand for pesticides in India for their export markets. The sector is also driven by huge opportu- Source: Ken Research nity for contract manufacturing and research for Indian players due to easy availability of technically skilled person- Board, Department of Agriculture. It tion, malnutrition and food inflation.” nel. takes almost four years to get a new Global agrochemicals players are scout- “Another boost for pesticides con- molecule registered, before launching ing Indian shores for profitable busi- sumption is from the growing horticul- it in India.” ness collaborations as by 2020 billions ture and floriculture industries,” says Giving an example he says that of of dollars worth of agrochemical pat- Gupta. the 15,321 samples of food commodi- ents will be expiring. They are seeking Dhanuka regrets, “There are many ties analysed by the concerned govern- low cost manufacturing expertise. It is myths and misconceptions about agro- ment department during April 2010 expected that as at least US$ 9 billion chemicals in India, resulting in very to March 2011, only 188 had pesticide worth of patents for more than 50 agro- low agrochemicals consumption and residues above the maximum residue chemical products will be taken off the very high wastage of crops. This is a limits prescribed under the Preven- patent list, manufacturing will move to highly regulated industry worldwide. tion of Food Adulteration Act, 1954. emerging markets like India to tap cost Vigorous lab tests and field trials have “This goes to prove that most of the effective opportunities. to be conducted and results have to be fear in public minds is unfounded and As of now no R&D is being done submitted to the Central Insecticides is resulting in food shortages, starva- in India to invent a new molecule, as the costs are very high. It is estimated that inventing a new molecule would require an investment of 5–10 years “There is huge growth and approximately `500–1,000 crore (US$ 85.38–170.77 million). Most of the opportunity in the sector, as research for new molecules is done in the consumption of crop US & Japan. Japan meanwhile is at the forefront protection chemicals in of foreign nations seeking India tie-ups India is one of the lowest in and has already started forming alli- the world. Only one-third of ances with Indian agrochemical firms. Talks are on between many Indian the farmers in India use it.” agrochemical manufacturers and glob- —Mahendra Kumar Dhanuka al companies and more deal announce- Managing Director ments are expected soon. Dhanuka Agritech Limited (Source: Interviews & secondary research)

www.ibef.org | april-may 2014 37 sectoral update TELECOM photo by th i nkstockphotos. n

Insurance Policy Success The Indian insurance industry is reinventing itself to tap new opportunities and expand horizons. by Charu Bahri

ndia’s insurance sector is growing from strength to entrants. By 2003, a handful of private players had started strength, with its prospects looking bright. The sec- operations. Then, they had merely 2 per cent of the market; tor which stood at a strong US$ 72 billion in 2012 has by 2012, their numbers had risen to 23 and they had cornered the potential to grow to US$ 280 billion by 2020. The 29.3 per cent of the market. growth is being driven by the country’s favourable Public sector giant Life Insurance Corporation (LIC) is the Iregulatory environment which ensures stability and fair play. undisputed segment leader, boasting 70.7 per cent share in This is promoting an insurance market which encourages 2012. ICICI Prudential follows a distant second, with 4.9 foreign investors to tap into the sector’s massive potential. per cent share. Other better known life insurers are SBI Life, The Indian insurance sector is successfully charting a course Birla Sunlife, HDFC Standard, Max Life and Bajaj Allianz. in different segments. Today, individual and corporate agencies, banks (bancassur- ance), brokers and direct offline and online sales mediums Life Insurance vie among themselves for a bigger share of the pie. Together, Life insurance has witnessed phenomenal growth in the last they are also working on growing the pie, for which there is decade. Between 2003 and 2012, life insurance premium col- plenty of scope. lections expanded at a compound annual growth rate (CAGR) “The bank channel has gradually increased its share to of 20.1 per cent. Premiums worth US$ 59.9 billion were col- about 35 per cent of the new business premium (or 20 per lected in 2012. Penetration levels have increased from 2.3 per cent of the number of policies) of private life insurers in cent in 2001 to 3.4 percent in 2012. The opening of the seg- 2012,” observes Shashwat Sharma, Partner, Management ment and substantive evolution in distribution channels has Consulting, KPMG in India. It is a win-win proposition for facilitated this expansion. life insurance companies, banks and customers. Custom- Life insurance was opened up to the private sector in ers perceive banks as trusted financial advisors. Insurance 2001. The huge potential of the segment soon attracted new players get access to an existing customer base. Banks can

38 april-may 2014 | www.ibef.org insurance sectoral update

tap a new risk free revenue stream and evolve into one stop shops for financial solutions. In future, KPMG expects online sales to gain ground for being a low cost channel and because internet penetration and customer awareness levels are rising. Another potentially promising channel is the mobile platform. India is a majorly underpenetrated life insurance market. Sales are largely driven by tax incentives on the uptake of insurance policies. Consumer awareness of insurance policies as saving devices is low. But this is expected to change. Per capita and disposable incomes and hence, household savings, are rising across metros, Tier II and Tier III towns, creating a new and large insurable class. according to Binay Agarwala, Executive Vice President, ICICI Prudential Life Insurance Company Limited, “Life insurance products have started to compete with other “We are taking “Growing financial savings products. We believe the pension category the lead in financial holds a lot of promise. A major plus of life insurance is it provides the dual benefits of protection and savings. Grow- creating Natural awareness... ing financial awareness coupled with an increasing work- Catastrophe offers a force offers a compelling reason for the Indian life insurance industry to grow.” Insurance compelling Pool for the reason for General Insurance Both private and public sector insurers occupy the motor, Indian market... the Indian life health, travel and fire general insurance segments, whereas, and a Nuclear insurance reinsurance, credit and crop insurance are currently the industry to grow.” exclusive domain of Indian public sector companies. Insurance Pool.” Gross written premiums in the non-life insurance segment —Ashok K Roy —Binay Agarwala Executive Vice President registered a CAGR of 19.6 per cent over the last decade. In Chairman-cum-Managing Director ICICI Prudential Life Insurance 2012, US$ 72 billion worth of non life insurance premiums General Insurance Company Limited were collected. As in life insurance, multi delivery mecha- Corporation of India nisms have become an accepted modus operandi in general insurance. Online selling, direct sales and telemarketing have helped bring companies closer to the customer and with the number of persons covered having increased expo- grow the industry. Still, the general insurance penetration in nentially from approximately 8 million in 2004 to 73 million percentage (ratio of premium to Gross Domestic Product) is in 2012, excluding 160 million individuals covered by the gov- merely 0.7 in India vis-à-vis 2.8 globally. The general insur- ernment’s Rashtriya Swasthya Bima Yojna. ance density, the ratio of premium in US$ to the population, KPMG expects the increasing numbers of small and medi- is 10 in India vis-à-vis 283 internationally, which shows the um enterprise takers and moderate increase in premium enormous scope for growth. rates to propel the near-term growth of the fire segment. Con- KPMG analysis and the IRDA Annual Report 2012 expect tinued economic growth and international trade expansion the Indian general insurance sector to grow at a CAGR of 16 would drive the marine segment. Individual and livelihood per cent between 2012 and 2020. microinsurance have great potential, provided companies can Based on last year’s performance, motor insurance enjoys surmount the barriers of low rural awareness levels and low the largest slice of the general insurance pie, a clear leader access. Government plans to extend the number of farmers with 43.1 per cent, thanks to rising sales and rising third party covered by crop insurance from 30 million to 50 million dur- premium rates. Other important segments are health, fire, ing the 12th Five Year Plan (2012–17). marine and engineering insurance. Bright prospects await all general insurance segments. In Favourable Environment particular, health insurance penetration is expected to more The Indian insurance industry operates in a favourable than double by 2020. It is one of the fastest growing slices, regulatory environment from the perspective of driving busi-

www.ibef.org | april-may 2014 39 sectoral update i nsurance

price detariffication in 2007, merger & acquisition guidelines in 2011 and third party premium increases and the introduction of a declined risk pool for motor insurance in 2012. A number of foreign investors have evinced an interest in entering this attractive market perforce through investments in the existing Indian insurance setup in view of current government regulations stipulating that such foreign sharehold- ings be limited to 26 per cent. Gopal Verma, Chairman & Managing Director, eMeditek, a TPA, is hopeful that the scope for foreign investments is expanded to Indian TPAs—“Global insurance companies and process outsourcing companies would make gains from outsourcing the processing of insurance claims to efficient and highly experienced Indian TPAs. Such investments would bring in best practices in addition to capital invest- “Global “The bank ment.”

insurance has increased Innovations Aplenty companies its share to Among innovations which are growing the product range, and process about 35 per and in turn the market, are customisation—the launch of products designed to match the risk profile of policy holders, outsourcing cent of the and products with more benefits attached. companies new business The life insurance segment has seen the launch of life- cum-health protection and other products. Agarwala men- would make premium of tions a few innovative products from ICICI Pru—“ICICI Pru gains from... private life Easy Retirement is for cost-effective retirement planning and ICICI Pru Guaranteed Wealth Protector, which gives Indian TPAs.” insurers...” customers advantageous equity exposure of up to 60 per —Gopal Verma —Shashwat Sharma cent and protects their investment through a capital guaran- Chairman & MD Partner tee feature.” eMeditek Management Consulting Health insurance players are offering policies tailored for KPMG, India specific disease profiles, such as diabetes cover, cancer cover, etc. As the segment matures, Verma expects health insurance policies to integrate wellness, preventive health checks, out- ness. The Insurance Regulatory and Development Authority patient procedures and more services. “I foresee the number (IRDA) promotes the uptake of insurance through directives of claims increasing and the role of Third Party Administra- aimed at creating a healthy, competitive and efficient market- tors metamorphosing,” he says. place, populated by responsible players who maintain pru- Any new product launched by a direct insurance company dent underwriting standards. Insurance products are covered needs extensive reinsurance support, especially in the initial under the exempt, exempt, exempt (EEE) method of taxation, period. In this, the Indian insurance market has full support for effective tax benefits of approximately 30 per cent on of General Insurance Corporation of India, the sole operator select investments. in the segment. “We have covered recent new launches in the Regulatory changes made in the last decade have effectively liability, oil & energy, aviation and cyber insurance segments, increased the stakeholders in the Indian insurance industry and some personal lines like Takaful. Also, we are taking the beyond insurers, to also include agents (individual and cor- lead in creating a Natural Catastrophe Insurance Pool for the porate), brokers, surveyors and Third Party Administrators Indian market and setting up an Indian Nuclear Insurance (TPAs) servicing health insurance claims. The IRDA has per- Pool,” shares Ashok K Roy, Chairman-cum-Managing Direc- mitted life insurance companies that have completed 10 years tor, General Insurance Corporation of India. of operations and meet other criteria, to raise capital through Nothing will secure the prospects of the insurance industry initial public offerings. Other notable milestones include the as much as companies getting proactive about innovation. introduction of standalone health insurance players in 2006, Certainly, the Indian insurance sector is poised to go far.

40 april-may 2014 | www.ibef.org Water Market sectoral update

Water Market Thirsting for Success The Indian water sector is emerging as an attractive investment opportunity. By Sangita Thakur Varma photo by th i nkstockphotos. n

ater, the world over, challenges (National Water Policy, 2012). ing, “India’s growing population and is a big concern. It With challenges also come opportuni- economy, combined with the impact is scarce and pre- ties in the water sector and in the recent of climate change, is not only making cious and countries decades, much interest has been gener- water scarcity a stark reality in many across the globe ated in India’s water management and parts of the country but is also leading Ware working towards preserving this the policy related to it. to the rapid growth and development irreplaceable elixir of life. India too “Challenges create stronger business- in the water sector. It is believed that has been working consistently towards es,” says Karan Chechi, Research Direc- the water sector can create potential developing its water resources right tor, TechSci Research, a leading market investment of approximately US$ 130 since Independence. However, with research and consultancy organisation, billion by 2030. The per capita annual only four per cent of water to serve the emphatically. availability of water is expected to reduce needs of a booming 18 per cent of world M H Subramaniam, Editor and COO, from the current 1,700 cubic metres to population, the country throws up many EA Water Private Limited, agrees say- less than 1,000 cubic metres by the year

www.ibef.org | april-may 2014 41 sectoral update Water Market

2025. Water recycling, industrial water hence the demand for commodities India Second largest treatment and sea water desalination are is also growing. Water is no different some of the big opportunities.” How- and India has reported exponential water consuming country ever, he adds, “Technology would be a increase in domestic as well as indus- key differentiator and organisations that trial requirements. The limited water Municipal Waste develop superior technology and execu- resources have forced industry players water tion capability, would be the leaders of to opt for recycling and water harvesting Municipal Industrial the future.” approaches, which germinated a whole Drinking Waste The current total demand for water in new segment, i.e., water and wastewater water water India is about 800 billion cubic metres management solutions.” Indian and this is expected to rise to 1,050 bil- The growth of the Indian water market water lion cubic metres by the year 2025. Cur- thus is primarily driven by the increase sector rently, irrigation consumes over 70 per in demand for fresh water in the urban, Source: Business Initiatives and Opportunities cent of the total demand, but industrial industrial and agricultural sectors. in India in the water sector, EIRC and utility water needs are expected to Further, the growing population, rapid grow the fastest. urbanisation and increasing industrial The water sector in India encom- activities are constraining fresh water in recent times. “A number of interna- passes the multiple techniques for water resources, consequently generating tional companies from North America, conservation and preservation to fight immense opportunities for the water Europe, Israel, Japan and Korea have scarcity, and wastewater treatment and and wastewater treatment market, shown a keen interest in the Indian purification. Rapid urbanisation and and advanced treatment technological market. However, there is a need to industrialisation have escalated demand systems such as reverse osmosis (RO) have widespread reach and relationship, for these services and acted as an impe- membranes. which should work to the advantage of tus for market growth. Other factors According to Subramaniam, “The Indian companies in this sector,” Subra- driving the growth of the market are water market in India is a loosely maniam sums up the market scenario. chronic water shortages due to fluctua- defined combination of a variety of sec- The water market is still not clearly tions in groundwater level; erratic rain- tors, all linked by their involvement in segmented. “The water management fall and lack of infrastructure to store it; the supply of clean water and discharge market is slightly ambiguous, as water and government initiatives for efficient of wastewater. Providers to this sector treatment is often considered as wastewater management with private partici- in India include public buyers such as water treatment, whereas water purifica- pation for which it is offering various central and state governments, public tion, water treatment and wastewater incentives and exemptions among other and private vendors of water related ser- treatment sectors are three completely things. vices, equipment and consumables, and different verticals,” says Chechi. Chechi throws light on this emerging industrial and domestic end-users.” However, the wastewater treatment water market scenario: “India is grow- Traditionally a very fragmented mar- and purification industry in India clearly ing, Indian economy is growing and ket, there has been some consolidation has an edge over the other sub segments as Subramaniam says it has shown tremendous growth in the last couple of years. “The industry creates an excellent “ The industry creates opportunity for foreign water treatment and purification companies to collabo- an excellent opportunity rate with Indian players, and generate for foreign water revenues in the lucrative Indian market.” treatment and purification Another attractive subsegment is the companies...in the membranes market which includes the RO, UF and MF membranes market. lucrative Indian market.” An attractive venture, opportunities here —Karan Chechi expand to include the water treatment Research Director, TechSci Research sector, such as desalination and water purifying. This segment is dominated by MNCs. There are other niche segments

42 april-may 2014 | www.ibef.org Water Market sectoral update

and capital intensive sectors such as wastewater treatment plant installation, “ The water market in equipment, mobile wastewater treat- India is a loosely defined ment, etc., that are a big draw. combination of a variety Opportunity lies in almost every subsegment of the water sector. While of sectors, all linked by some are witnessing average growth, a their involvement in the few others are reporting an aggressive growth rate. The water treatment chemi- supply of clean water and cals segment is one of the most lucrative discharge of wastewater.” segments witnessing the active involvement of industry players of all sizes —M H Subramaniam Editor & COO including international companies. It is E A Water Private Ltd a high profit margin subsegment where companies are operating at minimum 15–20 per cent profit margins. age treatment plants) could treat only believe in the growth of the wastewa- The lack of clear division has in no 7 billion litres per day. This converts to ter treatment market in India, which way impacted the market. According to 27 per cent of the total wastewater gen- according to us is poised to grow at a the India Water Market Report by Every- erated. However, a decade later (2011-12), CAGR of over 14 per cent over the span thingAboutWater, the current size of the the percentage of treated water slightly of the next five years,” Chechi sum- water and wastewater market is US$ 12 improved to 32 per cent of the total marises the growth avenues. billion and is expected to grow at a rate wastewater produced per day. With only Under the 12th Five Year Plan (2012- of 10–12 per cent annually. Government 60 per cent of industrial and 26 per cent 17), the Government of India has demar- projects contribute over 50 per cent of of domestic wastewater being treated cated an outlay of US$26.5 billion for revenues in this market while the pri- currently, wastewater management has the sector. “The government investment vate sector contributes the rest. “Some emerged as a key thrust area. will largely be concentrated on providing segments of the market like industrial “Market players are optimistic, the drinking water to rural and urban mass- water treatment, wastewater recycling, government is optimistic, and so we do es, but the effort and process to make sea water desalination and residential water available for its people will divert water purification should be growing at funds indirectly to the local and multina- faster rates,” Subramaniam forecasts. tional private players in the form of PPP The wastewater treatment segment Opportunity or BOT or BOOT and plant installation, alone, which is still in the nascent to name a few,” Chechi is positive. stages, is worth US$ 3 billion, “There Segments According to an EY (formerly Ernst are a lot of latent opportunities that need Municipal & Young) report, the India water sec- to be explored and are still unfolding,” tor requires an investment of around l Water supply and sanitation says Chechi. The overall wastewater l Treatment and purification US$ 130 billion between 2011 and 2030. treatment market is growing at a CAGR l Pumping and water transportation “However, a major challenge for indus- of around 14 per cent though some seg- l Wastewater treatment and try players, government and researchers ments might vary 1–2 per cent depend- recycling in the wastewater treatment space is ing on the involvement of Indian and posed by the lack of exact calculation of Industrial/Building/ Chinese players. Institutional market potential and data availability,” An improvement of a mere 7 per cent says Chechi. l Hotels, hospitals, shopping malls, was recorded in wastewater treatment apartment complexes At the India Water Forum 2013, Presi- levels in India in the last one decade— l Process water treatment dent Pranab Mukherjee emphasised the a statistical proof of the vast pool of l Wastewater reatment and importance of water management in his untapped opportunity in the market. recycling speech: “The National Water Policy 2012 Chechi presents an analysis of the recognises the need to improve effi- existing opportunities. In 2003-04, dif- Residential ciency in the use of water resources. The l Home purifiers ferent sectors in the country were pro- improvement of water use efficiency l Bottled water ducing about 26 billion litres per day of requires innovative tools of promo- wastewater, of which, all the ETPs (efflu- Source: Business Initiatives and Opportunities tion and incentives for efficient water ent treatment plants) and STPs (sew- in India in the water sector, EIRC utilisation. At the same time, it calls for

www.ibef.org | april-may 2014 43 sectoral update Water Market

dealing with inefficient water consump- data is detailed. A few of the contami- Water Requirement By Different tion through disincentives and stricter Sectors nant levels are not being monitored, and regulation. In the past, focus was laid if monitored, then the samples taken primarily on augmenting the quality of Sector 2010 2025 2050 belong to only a specific location. water available without giving due atten- Irrigation 688 910 1072 The best available actual data on tion to the manner in which the water Drinking Water 56 72 102 wastewater treatment is only for Tier I will be used or managed. A paradigm and II cities. According to Chechi, real shift from ‘water resources develop- Industry 12 23 63 time monitoring of data is important as ment’ to ‘integrated water resource Energy 5 15 130 the lack of it hampers in policymaking management’ is now necessary. For that, and as a result companies are unable to Others 52 72 80 the existing institutions involved in ser- make investment decisions. vice delivery have to be restructured and Total 813 1093 1447 “I remember, I was going through a strengthened.” * Data from Ministry of Water Resources. British government industry whitepaper The year 2013 was declared as “Water * All the values in Million KM3 on investment opportunity in the Indian Source: Business Initiatives and Opportunities Conservation Year” by the Union Cabi- in India in the water sector, EIRC water sector, where they had clearly net. The National Water Policy 2012 and mentioned that no concrete market data the National Water Mission too reiter- is available,” recalls Chechi. He is con- ated the country’s focus on water, and technologies. Urban water demand and fident that with the right data scientists emphasised the government’s policy water treatment and recycling space will have the desired set of correct data regarding it and the ways it proposed to would become the hot sectors for invest- indicators and can then suggest to gov- ensure water conservation and its equi- ment, the report had forecast. ernments policies and programmes for table use. A 2013 report by Austrade – India team sustainable development. In 2011, EY brought out a report titled titled Water – Overview and Opportuni- Numerous innovations are being Water Sector in India-Emerging Invest- ties in India summed up the key drivers attempted in the wastewater treatment ment Opportunities that brought the spot- of the burgeoning Indian water mar- space in recent times in India, but they light on the sector. The report pointed to ket under two heads—industrial and require organised and concrete incuba- the consolidated Foreign Direct Invest- municipal. While India’s rising indus- tion, says Chechi. In the absence of this, ment (FDI) policy of the Government of trial growth, large infrastructural proj- most such innovations lose applicability India allowing 100 per cent FDI in both ects like SEZs and parks, depletion in in a constantly changing technosphere. demand as well as supply segments groundwater, stringent pollution control “TechSci had suggested an innovative of water. This opened up investment norms and supportive government poli- idea for converting treated wastewater to opportunities for foreign investors in the cies will boost the water sector on the irrigation water to a multinational com- various water industry segments includ- industrial side; on the municipal side pany that wanted to enter India,” says ing supply and distribution, sewage and there is a growing demand for water, Chechi recounting an experience where sanitation where there was limited pri- need for sanitised water and budgetary lack of awareness led to the project vate sector involvement. These opportu- allocation from government that would not being permitted. The state govern- nities, set to multiply, given the size and drive the sector. ment, under a misconception that such the growing and diverse water needs The Austrade report also points to the a process could harm crops and health of India, have made its water market a US$ 300 million worth investments of farmers, turned down the proposal. huge investment potential for foreign under National Water Mission whose It is important for India to be open to companies. implications for the business sector are new ideas, he says. “The Indian market The study found that the Indian huge. The government has also invested is not ready to accept such inventions. water sector had the capacity to create US$ 20 billion (2012-17) for sewage Some efforts are being made by social investment potential to the tune of US$ treatment, recycling and irrigation, US$ entrepreneurs, but the number of such 130 billion by 2030. With private sec- 300 million (2013-14) for drinking water entrepreneurs is very low.” tor involvement increasing in India’s purification and there is US$ 170 mil- Subramaniam too contends that in water sector, there would be a need for lion PE in the wastewater industry. order to organise the highly fragmented efficient water and wastewater manage- For now, the constraints of lack of water market, there is an immediate ment to improve operating efficiency accurate data persist in the wastewater need for a common trade platform levels. This would lead to increasing management space. Chechi says, the where buyers and sellers from the water investment in emerging wastewater latest data available with CPCB (Central industry can network and initiate mutu- technologies such as the Hybrid Reac- Pollution Control Board) for 2011-12 is of ally beneficial business relationships. tor and Solid Aquifier Treatment (SAT) major indicators, whereas its 2009-10 (Source: Interviews & secondary research)

44 april-may 2014 | www.ibef.org Business Aviation sectoral update photo by th i nkstockphotos. n

Business Aviation Raring to Go Business aviation expands its wings across Indian skies capturing global attention. by Sanjay jha

he Indian aviation sector has witnessed a phe- as chartered services for tourism, medical and other pur- nomenal growth in the last decade. It registered poses. a growth of 12 per cent in the past 10 years and is India has emerged as the biggest fleet owner of business expected to maintain the pace aircraft in the Asia Pacific A( PAC) region in the years to come. Propelled with 15 per cent market share, leaving Tby India’s growing economy, the industry is behind China. According to a report by all set to become the third largest aviation Employment Generated Beechcraft Corporation, a leading manu- market across the globe by 2020. According facturer of business aircraft, in the APAC to a FICCI-KPMG report on the Indian avia- 12,000 region, India has a fleet of 254 business tion sector released in March 2014, India Direct personnel aircraft as compared to 213 in China, 192 could become the largest aviation market by (pilots, crew, in Japan, 150 in Hong Kong, 66 in Malay- 2030, given the large untapped potential for technicians, loaders, sia, and 53 in Thailand. As per the report, growth, with 99.5 per cent of the country’s maintenance Indian businessmen purchased 38 per cent population still dreaming of flying. staff) more aircraft during the economic slow- The demand for business jets will grow Indirect down period of 2008–12, as compared to in the years to come as they can connect to (an almost equal the previous five years. destinations not served by scheduled opera- number) According to Firestone Management tors. Earlier seen as a luxury, business jets Source: BAOA Group’s first biannual report, Private jet are now witnessing high surge in demand landscape within the Republic of India,

www.ibef.org | april-may 2014 45 sectoral update Business Aviation

released in March 2014, 43 jets were business jets for personal use. added in the last three years alone. The Most business jet and helicopter mak- cost of a private jet ranges between US$ Sectors Using ers are upbeat about the lucrative poten- 4 million and US$ 58 million. The coun- Business Aviation tial of the aviation market in India. Man- try has witnessed a significant growth ufacturers such as Cessna, Gulfstream in the number of non-scheduled airline l Corporates and Hawker Beechcraft are either setting operators, from a mere 36 in the year l PSUs and state governments up offices in the country or expanding 2000 to over 200 in 2011. From a figure l tourism—adventure, pilgrimage their existing businesses. of fewer than 40 in the year 2005, today l oil & natural gas exploration Tier II and Tier III cities in India have there are around 550 private aircraft in l Power shown huge potential for the develop- India, with 50 per cent fixed wing planes. l Mining & geological survey ment of general aviation as these cities l Medical are fast becoming local and regional Enabling Growth Factors l Disaster management centres for manufacturing, trading and India is located strategically between the l Remote area connectivity logistics for many companies. Middle East and Europe on one side and “It is not just the increasing number of the East Asian economies on the other, Source: BAOA billionaires that will propel the growth which fuels the demand of general avia- of the business aviation sector but the tion (GA). The growing economy has resulted in the increase advancement in regional connectivity will ensure its sustain- of wealthy Indians or high net worth individuals (HNIs), ability. Due to flexibility and low cost, general and business which in turn has spurred the demand for business jets, to aviation would be providing 60–70 per cent regional con- invest in more productive hours. nectivity through code sharing with scheduled airlines, which “The business aviation market, specifically the private jet/ would provide sustainability to these operations,” opined charter market, depends on the size of a country’s economy, the Capt R K Bali, Secretary, Business Aircraft Operators Associa- maturity of its market, and the size and scale of business. With tion (BAOA), a body that defines the standards of business India witnessing growth over the past decade and an influx of aviation in India. many foreign players, business aviation has seen a significant growth,” said Satyendra Pandey, Manager, CAPA India. Government’s Proactive Policies Beechcraft, quoting Knight Frank Wealth Report 2013, 100 per cent foreign direct investment (FDI) is permitted said the number of wealthy businessmen (HNIs) in India under the automatic route for MRO, flying training institutes would double from 8,481 in 2012 to 17,032 in 2022. In order and technical training institutions. As per the report of the to increase their productivity and customise travel, corpo- Working Group of the 12th Five Year Plan, a total investment rate travelers are looking to buy corporate jets for business of more than `20,000 crore (US$ 333.72 billion) is expected purposes. Besides, owning a private jet has become a status in general aviation in the plan period. This underlines the symbol and therefore many big market players are acquiring fact that today business jets are no longer seen as a luxury but as a tool for enhancing productivity. “Business Aviation in India would take off when our growth rate takes Growth in Business Aviation Fleet off and right policies and infrastruc-

600 ture is in place. In the contemporary 548 551 558 552 world the single window system 520 500 and e-governance are the norms of 462 granting clearances, which is now

400 390 being planned by the government,” 352 added Bali.

300 279 The Ministry of Civil Aviation in 233 2011 acknowledged that the general 204 200 aviation sector needs more attention and has been mulling the idea

100 of appointing a Director for Gen- eral Aviation. However, the DGCA

0 has been authorised to expand 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 safety oversight and general aviation Source: BAOA audits.

46 april-may 2014 | www.ibef.org Business Aviation sectoral update

Ironing Out Rough Edges A report by CAPA, released in February 2011, projected new aircraft sales up to US$ 12 billion over the next decade, to reach 2,000 aircraft in the general aviation fleet. The report estimated that about 75 per cent of the value of new aircraft sales is expected to come from the business jet sector. As a result, the direct and indirect economic contribution of GA could reach US$ 4 billion annually by 2020. “The regulator needs to sit with the GA industry and map a policy that supports the growth of the GA industry as a whole. Collaborative rule making where the regulator plays the role of a facilitator to clear barriers to GA growth is required. Also, the government and industry need to study the history/growth of GA in the US and Europe, and use the information to model local (India specific) “ With India “ The regulator requirements to encourage the growth of GA in the short, witnessing needs to sit medium and long term,” said A M Ganapathy, Managing Partner & Director, Commercial & Business Aviation Ser- growth over the with the GA vices Private Limited. past decade... industry and There are 150 airports in the country capable of handling business aviation aircraft. With the spur in demand for business map a policy business aviation in India, the government is working on aviation that supports upgrading and expanding airport infrastructure in Tier II and III cities. has seen a the growth significant of the GA Race to Capture Market BAOA says that during the next eight years India needs to growth.” industry.” develop as many as 100 additional airfields. The aviation body —Satyendra Pandey —AM Ganpathy estimates that India needs at least 20 new FBOs to cover the Manager Managing Partner & Director CAPA, India Commercial & Business existing main airports and that there is also a case for estab- Aviation Services Private Ltd lishing as many as 700 heliports around the country. While US manufacturer Boeing is developing an SEZ beside the Nagpur airport for setting up an MRO facility in a joint venture with Air India, Bravia has also acquired around Nagpur. Air Works has three major facilities in India with 35 acres of land in Nagpur for building hangars and Mumbai hangars at its base in Mumbai and Delhi dedicated to GA and based Max Aerospace is building a smaller MRO facility in plans to acquire at least two more hangars in India. Dassault Aviation, a part of French aerospace company Groupe Dassault, which has a majority share in the Indian business jet market, is looking at setting up an MRO centre Opportunities & next year. The Zurich based leading global business avia- Environment tion company VistaJet, which has a strong base in Africa and Russia, is in discussion with existing business jet operators l Corporate India recognising business to find a domestic partner for its India operations. The busi- aviation as a vital commerce tool ness jet operator plans to base two of its aircraft in India to l HNI growth, number of billionaires increase its footprint in the growing business aviation market l Development of tier II and III cities in the country. Empire Aviation (EA), from the Dubai based l Life saving measures for critical Empire Aviation Group, has outlined a comprehensive range patients and use in disaster man- of business aviation services for private aircraft owners in agement India, which includes a one stop shop approach. Metrojet l Industrial, business opportunities in Ltd, a leading provider of business aircraft services in Asia, is remote areas, in the hinterland planning to build a hangar in India as a part of its strategy to make a hold in the growing marketplace. Source: BAOA (Source: Interviews & secondary research)

www.ibef.org | april-may 2014 47 made in india Wipro

A Good Corporate Citizen Wipro sets new benchmarks in ethical enterprise as is charts its course across the globe as a top IT

company. By Ravi sagar

ipro Ltd, a leading global information technology, consulting eters: ethics and compliance program and outsourcing company, achieved a hat-trick in the corporate (25 per cent); reputation, leadership and governance sphere on March 21, 2014. It was declared the World’s innovation (20 per cent); governance Most Ethical Company, 2014, for the third successive year by (10 per cent); corporate citizenship and Ethisphere Institute, an independent centre of research promot- responsibility (25 per cent); and culture Wing best practices in corporate ethics and governance. So what makes Wipro stand of ethics (20 per cent). Reacting to the among the best companies in the world? The companies are judged on five param- achievement, Anurag Behar, Chief

48 april-may 2014 | www.ibef.org Wipro made in india

Sustainability Officer, Wipro, said, “At Wipro. The original busi- 2014, its revenues from Wipro, ethics, integrity and responsible ness was manufacturing continuing operations citizenship have always been at the core of vegetable and refined were US$ 7.3 billion, an of how we think and act.” oils under the brand increase of 16 per cent Ethics and responsible citizenship are names Kisan, Sunflower 7.3 YoY, while the revenues in the DNA of this global information and Camel. In 1966-67, billion from continuing opera- technology, consulting and outsourcing the reigns of the compa- Wipro revenues tions for quarter ended company. Its Chairman, Azim Premji, ny passed into the hands from continu- March 31, 2014 stood is not just a business tycoon but among of the 21 years old, Stan- ing operations at US$ 2 billion, an the avant-garde philanthropists of the ford University educated for year ended increase of 22 per cent world. Premji has donated nearly 21 Azim Premji, son of YoY. Commenting on the per cent of his stake in Wipro, which is Mohamed Premji, upon March 31, 2014, company performance worth `25,000 crore (US$ 4.27 billion). the latter’s death. Azim an increase of Azim Premji, Chair- The money is invested in a trust that Premji took charge as 16 per cent YoY. man, Wipro, said, “The funds and manages education focussed the Chairman and thus steady improvement in philanthropic projects under the Azim began Wipro’s journey global economy, coupled Premji Foundation. Premji is now keen as the fastest growing with the exciting pace of to establish sustainable models of his company in the world. Premji diversi- technological advancements, presents social service ventures on the lines fied the hydrogenated oil manufactur- us with opportunities to create innova- of Bill & Melinda Gates Foundation ing business to bakery fats, indigenous tive solutions to help our customers dif- and Ford Foundation, where he would ingredient based toiletries, haircare ferentiate, compete and succeed in their donate to social sector enterprises work- soaps, baby toiletries, lighting products, respective markets.” ing in related fields. Premji is the first and hydraulic cylinders. It has certainly been a good year for Indian to sign up for The Giving Pledge, The decades—1970 and 1980—saw Wipro. The company was named ‘Lead- a campaign led by Warren Buffett and the company focusing on the emerging er’ in Worldwide Life Science Manufac- Bill Gates, to encourage the wealthiest IT and computing industries in India. turing and Supply Chain ITO by tech- people of the world to make a commit- In 1977, the company was renamed nology global research and advisory firm ment to give most of their wealth to phil- Wipro Products Ltd but it was in 1980-81 International Data Corporation (IDC) in anthropic causes. that it made its mark on the IT horizon its report IDC MarketScape: Worldwide Wipro’s seeds were sown in the with still another rechristening as Wipro Life Science Manufacturing and Supply Indian soil by an illustrious and patri- Ltd. Chain ITO 2013 Vendor Assessment. It otic business family. Founded in 1945 Today, the company is a global infor- won a five year infrastructure managed as Western India Vegetable Products mation technology, consulting and out- services contract with a Fortune 500 Limited in Amalner, Maharashtra, by sourcing company with 145,000 employ- global leader in specialty chemicals; a Mohamed Premji, son of the Rice King ees serving over 900 clients in 60 seven year engagement with Xoserve, an of Burma, it was later abbreviated to countries. For the year ended March 31, organisation which is an integral part of

Milestones Established in 1945 as Pioneered marketing assessed at SEI-CMM Western India Vegetable of indigenous Personal Level 5 in 1998 Products Limited in Computers in 1985 Listed on NYSE in 2000 Amalner, Maharashtra Established a joint venture (NYSE:WIT) IPO for capital in February with GE in 1989 The first company in the 1946 Entered IT services in world to be assessed Ventured in to the fledgling the 1990s—among the at PCMM Level 5 in IT industry in 1981 pioneers in developing 2001 Established software the ODC (Offshore Entered the BPO business products and exports Development Center) in 2002 subsidiary, Wipro Systems concept Entered the Ecoenergy Ltd in 1983 Software business business in 2008

www.ibef.org | april-may 2014 49 made in india Wipro

the restructured gas distribution market facturer in the world, delivering around and benefits, more than doubling from in Britain; a large global bank selected 2 million cylinders to OEMs in different US$ 733,827 in fiscal 2012-13 to US$ 1.71 Wipro as a strategic partner to provide geographies. It has a global workforce million. quality assurance and automation ser- of over 1,700 people, and 14 state-of-the- Wipro’s good performance in all its vices; a leading apparel and footwear art manufacturing facilities across India, business verticals is based on its belief company renewed its multi year engage- Northern Europe, Eastern Europe, US, in sustainability. For Wipro sustainabil- ment with Wipro for application support Brazil and China. The two associates of ity means good citizenship for it believes services in a managed services model; Wipro Enterprises Limited are Wipro that corporations are “socio economic it won a deal from a multinational tele- GE Healthcare Private Limited and citizens” and their objectives must be communications company to manage Wipro Kawasaki Precision Machinery congruent with society’s goals. Compa- IT and network operations for their Private Limited. nies have the power to influence social enterprise business in India and a large Recently, in a major sign of approval issues which translates into the “power deal in the Basel II Risk & Compliance of the measures initiated by Wipro CEO to do good”, hence it is a responsibility domain from a large state owned bank T K Kurien, his salary crossed the mil- incumbent upon them that must trans- in India. lion dollar mark for the first time this late into well thought out definite action In a recent development, Wipro fiscal, as the company continued to back and not charity. bagged the over US$ 400 million deal his turnaround plans. The chief execu- As a responsible entity the com- from Takeda Pharma, the largest Japa- tive’s pay, including benefits, increased pany tries to make an impact in society nese pharmaceutical company. Under from US$ 888,228 in fiscal year 2012-13 through three clearly defined pillars: the multi year deal that was described to US$ 1.1 million by the end of March 1. Business Integrity: working under as “strategic partnership”, Wipro will this year, primarily due to the rise in the a clearly defined code of conduct with develop and support IT requirements of variable pay component. The company good corporate governance; 2. Eco- Takeda Pharma. It will provide IT infra- also saw its Chairman Azim Premji’s logical Sustainability; and 3. Social and structure to the pharma firm. A senior annual compensation, including salary Community Initiatives for sustainable company executive said the deal will add improvement of communities. to Wipro’s revenues immediately. The Some initiatives taken up by Wipro company’s healthcare and life sciences “The steady under sustainability are Wipro Cares, unit, which accounts for 10.3 per cent of Wipro Applying Thoughts in School, Wipro’s US$ 6.6-billion revenues from improvement Mission 10XEco Eye and Earthian. In IT services, is set to get a shot in the arm 2012-13 its sustainability accolades from the deal. The healthcare and life in global included: Dow Jones Sustainability sciences unit grew 14.3 per cent for the Index (DJSI) World member for the quarter ended March 2014. In the after- economy fourth time in a row; DJSI Emerging math, the shares of Wipro rallied more coupled with Markets Index member for the second than 3 per cent in intra day trade on the time in a row; one of the seven compa- day the deal was signed. the exciting nies from the IT sector globally and the The businesses of consumer care only one from India in Carbon Disclo- products, domestic and commercial pace of sure Project (2012); ranked first in the lighting and infrastructure engineer- 18th edition of the Greenpeace “Guide to ing is being carried out under the Wipro technological Greener Electronics” rankings in its first Enterprises Limited umbrella. This has advancements appearance in the list; second globally two divisions—Wipro Consumer Care and first among IT companies in the and Lighting (WCCLG) and Wipro presents Newsweek 2012 World’s Greenest Com- Infrastructure Engineering (WIN). panies; featured in the Greenpeace Cool WCCLG is among the fastest grow- us with the IT Leaderboard rankings for the third ing FMCG companies in India with a consecutive year, at No. 5 in 2013; and strong brand presence in personal care opportunities rated “Prime” B+ by Oekom, leading and skin care categories in South East ... to help our European Sustainability rater: ranked Asia and Middle East with significant global No: 1 for the IT services sector. market share in identified segments. It customers...” Wipro is setting new benchmarks in has a global workforce of 8,300 serving good corporate citizenship even as its over 40 countries. WIN is the largest Azim Premji Chairman raises the bar in meaningful independent hydraulic cylinder manu- Chairman, Wipro philanthropy.

50 april-may 2014 | www.ibef.org Wipro made in india

www.ibef.org | april-may 2014 51 Innovation Corner MozziQuit

The Big Bug Slayer It’s the mother of all mosquito killers, trapping 1,000 bugs in a mere two hours. What’s more, it is free of harmful chemicals, cost-effective

and has a long shelf life. By Binita singh

52 april-may 2014 | www.ibef.org www.ibef.org | april-may 2014 53 MozziQuit Innovation Corner

hat irritating buzz has always been a menace. first monsoon complete leakage was arrested. Since the Earlier it was malaria, encephalitis and filariasis clients asked for 10 years guarantee against waterproofing that lurked threateningly. Post a monsoon works, I carried out limited works in subsequent years to downpour, a new enemy lurks in the soothing monitor the results of waterproofing done for the required green potted plants, the puddle of water across the period,” says the serial innovator. Troad or even that bucket of water stored in the bathroom to The chemicals manufactured by Noronha were used in tide over perennial water woes—the deadly dengue causing place of equivalent products of FOSROC India Ltd, to repair Aedes Aegypti mosquito. As of now people are arming the deteriorated structure (container handling jetty) of JNPT themselves with mosquito repellants, sprays, gels, electric Port, Mumbai, above the sea, with polymer modified mortar. racquets, mosquito nets, and homemade and Chinese The project was executed in the years 2000 to 2002, and is a remedies to buzz off the bugs. standing testimony of more than 12 to 14 years to Noronha’s But are these remedies really effective? And how eco- practical innovation in manufactured chemicals of polymer friendly, harmless and cost-effective are they in the long modified mortar used for retrofitting works of container run? Not a lot as we all know. handling jetty, that cost less than international products like MozziQuit may not yet ring a bell for many of us. Blame those of FOSROC. “The cost is much less as I do not have to it on the lack of commercial hype that usually surrounds pay any royalty or high administrative costs,” says Noronha the launch of FMCG products. Yet, this mosquito trap is of his innovation. an award winning patented innovation by serial innovator In 2002, the idea of MozziQuit germinated in Noronha’s Ignatius Orwin Noronha. mind when he came across Mosquito Magnet manufactured Fifty three year old Noronha is not a scientist by education by American Biophysics Inc. of US, in Hyderabad, at their or training. It is surprising then that this commerce Indian distributor’s facility. The mosquito repellent was graduate has such a keen knack for science and innovation. outrageously priced at `1,10,000 (US$ 1849.36) per unit His career, in fact, began as an office assistant for a Cypriot with a monthly operating cost of `5,000 (US$ 85.38), and Greek construction company in Bahrain where he worked used a hazardous chemical called Oct-o-nel. “This made for seven years. Thereafter, he moved to Saudi Arabia me carry out R&D on an indigenous economical mosquito and worked for three years as Inventory Controller for a trap at affordable cost for Indians to eliminate mosquitoes,” manufacturing company producing construction chemicals, says Noronha of his initiative that led to the innovation of fireproofing products and fertilisers as per the formulations MozziQuit. of W. R. Grace & Co. of USA. Noronha was ready with his first MozziQuit prototype Noronha’s foray into innovation started about this time. by November 2002 despite receiving no support. “My first “As I got acquainted with the manufacturing of various prototype cost me just `2,000 (US$ 34.,15) and attracted and construction chemicals, in March 1999, I manufactured trapped more than 1,000 live mosquitoes within two hours waterproofing chemicals and executed waterproofing works between 6 pm to 8 pm in the evening.” of RCC roof slabs in Mangalore. It was observed that after However Noronha was still struggling with high daily

Max (left) and Mini (right)

Giant Killer: MozziQuit are all-purpose mosquito trappers as they can be used anywhere, in homes or cowsheds.

52 april-may 2014 | www.ibef.org www.ibef.org | april-may 2014 53 Innovation Corner MozziQuit

operating cost of `200 (US$ 3.42) per day. “Since then I the reason, “Since there was no support from anyone for my worked hard to bring down the operating cost to less than R&D it took more than 12 years for me to release the product 5 paisa per day with excellent performance of trapping to market.” mosquitoes.” For this particular innovation, it was a personal pain point It was after several years of persistence that MozziQuit that proved to be the inspiration for the serial inventor. attained commercial scale. Noronha matter-of-factly states “I had made a resolution when I was just a small child, about five years old, to destroy mosquitoes. It was when my mother told me the cause for the swelling in one of her legs was due to mosquito bite (filaria).” The product comes in two variants—high and low intensity. MQ-MAX, priced at `2,990 (US$ 50.27), is

The Practical Innovator n December 1999, Ignatius Orwin Noronha, approached IOCL with his innovative 4” thick fibrous concrete mix design which took just 24 hours of curing for Ithe driveway of its petrol station at Goregaon East, Mumbai. The conventional 12” thick road concrete took 28 days of curing, and Noronha’s innovation prom- ised cost saving in concrete material and labour amounting to 8” thick concrete besides the advantage of allowing movement of traffic 24 hours after concreting. Since it was a totally new technology, the general manger of IOCL, a civil engineer, requested a 10”x10” sample size of cast on December 10, on which a three step test was conducted the next day. First, a water tanker with 10 tonne load capacity was run on it many times. Second, the same 10 tonne loaded tanker moved at high speed and applied brakes just above the sample concrete. The third test involved hitting the sample concrete with a hammer. As the sample concrete passed all tests, IOCL issued the work order in March 2000 and the work was completed in April 2000. After more than 14 years of use, the road is a living testimony to Noronha’s extraor- dinarily strong, durable and cost saving innovation. It has been recognised by the government, and Noronha, at the inivita- tion of Oscar Fernandes, the then Min- ister for Road Transport & Highways, gave a presentation on it to the senior officials of Indian Roads Congress, in January 2014. The technology will save the ex- chequer more than `7.50 lakh crore (US$ 126.09 billion) against the Serial Innovator: Ignatius Orwin Noronha believes in finding sanctioned 5 lakh kilometer road practical low-cost solutions. works to be concreted during the 12th Five Year Plan period.

54 april-may 2014 | www.ibef.org www.ibef.org | april-may 2014 55 MozziQuit Innovation Corner

suitable for use in cowsheds, dog cages and houses where mosquito density is high. The operating cost of MQ-MAX is 15 paisa per day for power equivalent to a zero watt bulb. MQ-MINI, the low intensity mosquito trapper, is priced at `1,500 (US$ 25.61) and is suitable to be used in houses and flats where mosquito density is low. The operating cost of MQ-MINI is 5 paisa per day for power equivalent to 3 watts. The products have longevity and last for more than 10 years unless physically damaged. Noronha says that the Awards replacement cost of parts would be negligible even after five & Accolades years of regular use. Discussing the details of MozziQuit, Noronha explains, • Gold Medal Award in DST-Lockheed Martin India Innovation “Food grade proprietary additives are added to the plastic Programme 2010 raw material, among the few components, while producing • ISA Best Electronic Product of the Year 2010 in the health- them through injection moulding machine. These additives care category in combination with light and temperature equivalent to • Approval issued by National Institute of Malaria Research body temperature which are generated by the MozziQuit, after testing MozziQuit attract mosquitoes towards the trapping zone of the device. • Validation from Assistant Director of Veterinary Hospital/Ani- Once mosquitoes get attracted and start flying near the mal Husbandry after testing MozziQuit trapping zone of MozziQuit, they are vacuumed into the • One of the six finalists in Samsung Innovation Quotient Sea- removable collection container through the instant killing son 2 held on August 17, 2012 zone of perforated holes. The dead mosquitoes are then • One of the 12 contestants of Bloomberg UTV’s business real- collected in the removable collection container and can be ity TV show Pitch for `5 crore (US$ 0.85 million) disposed.” The process patent for MozziQuit was granted to Noronha in May 2010. He has also received 11 Design Registration Certificates since 2009, which have been granted by the Indian Patent, Designs & Trademark office. the innovator entrepreneur. Though MozziQuit is yet to become a household name MQ-MINI too is in great demand for use in flats and like other smaller commercial mosquito related products, houses as mosquitoes are ubiquitous, says Noronha. Noronha has found considerable commercial success and is He adds, “Our success lies in our innovative patented in the process of scaling his enterprise. technology which provides maximum level of health In Mangalore, as he claims, “Assistant Director of protection to our customers.” Veterinary Hospital/Animal Husbandry has issued a Comparing the benefits of MozziQuit with other models validation report confirming trapping of thousands of he says, “These mosquito traps are harmful to users as mosquitoes every day resulting in increase in milk yield the UV radiation from the UV light installed in their traps as the cows get enough rest at night without mosquito is directly visible which causes skin cancer and affects menace.” This certificate was issued after testing MQ-MAX eyesight. MozziQuit does not have any UV radiation.” at various locations in and around Mangalore under the MozziQuit is being manufactured and marketed by supervision of veterinary doctors and senior medical Leowin Solutions Pvt Ltd. It is a private limited company inspectors. that was established by Noronha with a vision to create an “We have completed test market on both the models,” the environment that is free of mosquitoes and to innovate, innovator adds, “and in fact, MQ-MINI has been redesigned manufacture and market eco-friendly products. “Presently based on the feedback received from the test market.” we manufacture and market MozziQuit MQ-MAX and MQ- Bolstered by the test market reception, Noronha is gung- MINI,” explains Noronha. ho about the next phase of the MozziQuit journey—the large A great votary of research and innovation, Noronha scale commercial launch. “We expect to supply more than 10 says, “R&D enables companies to sustain in the market million units in India to all the cow owners/farmers through against competition. Social responsibility should be made the membership network of dairies at subsidised price as mandatory for companies so that they encourage innovators the central government is ready to release subsidy amount to to carry out research and innovation.” all the states to support increase in production of milk,” says Perhaps this would lead to more such cost-effective, green,

consumer friendly products being innovated.

54 april-may 2014 | www.ibef.org www.ibef.org | april-may 2014 55 arts & culture

Living Legacy: (Top) A complete meal of paranthas, pumpkin, homemade pickles, chutnies and raita; (Left) the oldest restaurant; (Below) The gali has an efficient ecosystem. More than Just Paranthas Taste a slice of history along with scrumptious paranthas here. By binita singh

here is an eponymous film dedicated to its essence and aroma. port and take a walk down the crowded streets It has been covered by international press like The Wall Street of Chandni Chowk. This is where Old Delhi Journal. Celebrities—Indian and foreign—make it a point to really lives, as does the true essence of India. drop in here for a taste of the famed cuisine. Yet, residents Walk down the Shri Digambar Jain Lal Mandir, here are as indifferent to the tinsel and glare of media flash- Gauri Shankar temple and Sisganj gurdwara— Tbulbs as they are to the constant humdrum of life surrounding them. all heritage sites that you can explore—you Welcome to Paranthe Wali Gali or Gali Paranthe Wali, the will be guided by your nose and the amused gourmet destination of all foodies, tourists and travelers look- smiles of the hawkers, rickshaw pullers and ing for a taste and feel of authentic Delhi. The ‘Alley of Flat- auto drivers to whom you throw your query breads’ as it has been nicknamed for the English speaking audi- for direction to the narrow alley. At the corner ence, is a treasure trove of aromas and historical flavours. is a famous sweet shop, stocking the famed Tucked away in one of the nooks of the walled city, off the main street, you Karachi Halwa and Sohan Halwa of Delhi. may pass it by but for the mouthwatering aromas wafting out of the alley. As you walk down the narrow lane, wide For this culinary journey of discovery it makes sense to ditch motor trans- enough for one way two wheeler traffic that

56 april-may 2014 | www.ibef.org Food arts and culture

City of Paranthas food, have? Sorry, it's not the for a hearty meal. Be it the the Moolchand Paranthewala If Hyderabad has its biryani, dahi bhalle or gol gappe but Ganga Dhaba of Jawaharlal at the corner of Vikram Bihar its litti chokha, Mumbai the ubiquitous paranthe that Nehru University, a legend Hotel behind Lady Shri Ram its pao bhaji, what does make Delhites roll up their for the lip-smacking aloo College; each corner of Delhi Delhi, the capital of street sleeves at a roadside stall paranthas and egg bhurjis or boasts its own paranthewala.

often whirrs past just inches away, you can see the shack like restaurants tucked chock-a-block. There is the odd sari shop, but by and large the lane is home to the eponymous paranthas and lassi, rabri and malai khurchan shops. The latter two are famous milk based sweets served as Taste of India: With desserts to polish off your heavy parantha meal. around 40 varieties of paranthas to choose Along with the lassi, they add to the gastronomic from between the delight of the mouthwatering paranthas. three shops to the accompaniments of The parantha, a fried, flat wheatbread, is part of vegetables, chutnies every Indian cuisine. A household staple, many and pickles—all made mornings, especially in north Indian households, with family recipes—the lassi from the next door begin with a sumptuous breakfast of stuffed stores to wash the paranthas, especially in winters, topped with a tall food down and yummy malai kurchan or rabri glass of lassi. What then is the secret ingredient as the sweet finale to of the Paranthe Wali Gali that makes this humble the meal, there is really staple a world favourite remains a mystery. a royal choice awaiting “Every day I come at around 4 pm from college in Paranthe Wali Gali. It Perhaps, it is not just the parantha but a slice is a cultural awakening and relieve my father.” He has been coming to of history that is served along with it that makes of the taste buds. the shop through his teenage years and would sit the taste so unique. The paranthawalas who The paranthawalas with his father, Suresh Sharma, to get a feel of the hail from Bhind in Madhya Pradesh, have been fear no competition place. Speaking fluent English, while handling living here for the last six generations in most from either kin or customers and the staff with equal finesse, Ravi others. Working with cases. There is no written history of the gali, recipes perfected displays a maturity beyond his age. The softspo- but the oral history, along with the delicious down generations, ken youth has also learnt the family trade and can recipes, has been passed down generations. all their preparations dish up a mean parantha. He smiles, “I am proud are in desi ghee, and Ravi Sharma is a student of English at Ramjas the shops have a no to be a part of one of the most famous streets in College, University of Delhi. “I am the sixth gen- onion-garlic policy. Delhi.” He has grown up on the stories of past eration in this business,” he proclaims proudly glories of Chandni Chowk. “My father spoke as he takes up the platform just vacated by his about a tram that used to run here,” he says. Even father. It is just past 4 pm. Nicknamed ‘Paran- at this late afternoon hour in May (there was tha’ by his friends, Ravi says this is his routine. an unexpected duststorm and drizzle), there is

www.ibef.org | april-may 2014 57 arts and culture food

Charan (sixth generation) was established 1872. It is claimed to be the first among the surviving lot. Anil Sharma, of the current generation, was busy roasting the paranthas, oblivious to the heat. “My grandfather belonged to Madhya Pradesh. Of four brothers, he was the one to come here as there was no work in the village. He established the shop,” he recounts. Anil concedes that he does not have much knowledge of family history. Refus- ing to disclose financials, he said, “We receive 200–300 customers on an average, enough to sustain our family.” He does not know about the future of Love in the Food Street: Paranthe Wali Gali, the film, captures the essence of the eponymous food street his legacy. “My children are not inter- through the eyes of the protagonists, especially the female lead who just loves the paranthas sold here. ested in the shop. They have opted for other careers.” He shrugs philosophi- a rush of customers, which according Suresh Sharma is candid. “We cally and smiles. Despite the fame and to Ravi is low. “In winter there is a big- don’t know much about history and other people trying to capitalise on ger rush.” It includes foreign tourists only remember what we were told by their famous format and recipes (Mela and often Indian celebrities, he laughs. our past generations. We are reap- restaurant, UK, and Only Paranthas of “Ranbir Kapoor and Sheila Dikshit have ing the benefits our elders’ efforts.” Mumbai among others), they have not come here. Vidya Balan also came.” The efforts started in 1872 with Pan- thought of opening a branch in a more Though Pandit Babu Ram Devi dit Gaya Prasad, who left his home posh New Delhi locality. The reason, Dayal Parathe Wale (sixth gen- in Tehsil Bagh in Agra in search of as Anil says is, “The high rentals.” eration) are also in the business of work and came to Delhi. He set up a Jai Hind Paratha Bahwan was estab- electrical goods, for Ravi, his heart shop in a lane entering Kinari Bazaar lished in 1875 by Pandit Kanhaiyalal resides in Paranthe Wali Gali. in what was then known as Dariba Durgaprasad. He is Abhishek Dikshit’s The street gained mindshare in the Kalan and started serving his mouth- “dadaji’s dadaji”. Dikshit has never Indian consciousness with Indian film watering paranthas. Soon enough his thought of venturing into another busi- actor Akshay Kumar’s revelation of fame grew so wide and his clientele ness. Busy rolling out paranthas, this having spent some years of his life on so huge that he had to seek help from fifth generation paranthawala is unsure the street and his extreme attachment his brothers. The business spread in if his children will carry on the family to it. While his film Chandni Chowk to the lane with the brothers opening business. Dikshit’s elder brother chose China used a recreated Gali Paranthe separate shops, all serving paranthas. to settle down in London. A Delhi Uni- Wali, Vidya Balan, Cyrus Broacha Originally there were around 18 shops, versity graduate, his day begins at 9 am and Salman Khan could not resist the of which only three remain today. But and ends at 11 pm, only after the last cus- temptation of a slice of the real thing. the fame has refused to die down. tomer is served. The Dikshits are from On the walls of Pandit Gaya Prasad “We are all from one family… all shops Uttar Pradesh unlike the Sharmas of the Shiv Charan’s shop hangs a framed are owned by relatives here. There are other two parantha restaurants, though photograph of famous political per- 18 shops of one extended family but they are all related, as Suresh claimed. sonalities—Pandit Jawaharlal Nehru, not of paranthas. They are into other The turnover of Dikshit’s shop is `36 Indira Gandhi, Babu Jagjivan Ram and businesses now,” says Suresh. “We to `50 lakh annually. Talking about Vijyalaxmi Pandit sharing a table and a are 42 brothers,” he continues adding, customers he says, “Earlier they were meal of paranthas. Former Chief Minis- “Some are into milk business, some mostly businessmen, but now it’s a ter of Delhi, Sheila Dikshit, is also being run hotels; but making paranthas is mixed crowd.” Asked if the staff too served in another photograph. Pandit in our blood,” he gives a loud laugh, are legacy, Dikshit says, “Each of the Babu Ram Devi Dayal Parathewala twirling his thick mustache. People call shops has only five to six impermanent has played host to former Prime Min- him Panditji as they do the other older staff.” Yet, all the shops are doing well. ister Lal Bahadur Shashtri, whose generation paranthawalas around. As he says, “Customers choose their photograph adorns their shop wall. The shop of Pandit Gaya Prasad Shiv shops.” It’s the aromas that help.

58 april-may 2014 | www.ibef.org sculpure arts and culture BooMing ToURiSM MARKET India will be one of the fastest growing travel & tourism markets between 2013-23.

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www.ibef.org | april-may 2014 59 Tourism update McLeod ganj Colour Coordinated: One of the newer Buddhist monasteries to add to the Tibetan cultural ambience at McLeod Ganj.

Prayer Notes: Prayer wheels at McLeod Ganj monasteries are as a ritual turned daily by the monks.

Picture Perfect: A view of one of the streets in McLeod Ganj that is among the many vantage points providing a picturesque

photos: Abhishek b a li view of the village. Discovering Tibet! A visit to Little Lhasa or McLeod Ganj is enriching. By binita singh

s a little girl growing up in Gaya, home to the famous centre of Buddhism, Bodh Gaya, I was intrigued by the Anglo Indian population in missionary schools. They were from the suburbs of Dharamshala, is situated in the some place called McCluskieganj, a place I believed to be in hilly terrains of Kangra district in Himachal Britain that was home to ‘foreigners’. Pradesh and is a popular Tibetan colony. ARecently, when I met a gentleman from the US who has been living in India Choosing not to miss out on the scenic drive to with his entire family for the past 14 years, it brought back a flash of childish Himachal Pradesh, we boarded the bus at Majnu memories when he mentioned his home was in McLeod Ganj, Dharamshala. ka Tila in North Campus, Delhi, which inciden- The similarity in their names also set me on a journey of discovery—of McLeod tally is a Tibetan hub. If inclined you may even Ganj. The bonus was the summer weekend getaway’s proximity to Delhi. board the twice daily flight from Delhi or catch Of course not much is in common between the two places except their the daily train. While the about 12 hours’ bus ride obvious prefixes. While McCluskieganj, now in Jharkhand, was an Anglo took us directly to the tiny hamlet nestled in the Indian colony, McLeod Ganj, popularly known as Little Lhasa, a village in lap of the Dhauladhar range, a ridge of southern

60 april-may 2014 | www.ibef.org www.ibef.org | april-may 2014 61 McLeod Ganj tourism update

outer Himalayas, the air route leads to Daggal, a Five Key town near McLeod Ganj. There are more than 10 Highlights trains that will take you to Chakki Bank, a small station near Pathankot, from Delhi. This is the 1. Welcome All nearest point to the village via railroad. McLeod Ganj is a suburb of Dharamshala, the main township of Kangra district. As we neared our destination, the sight of the picturesque snow clad peaks of the Dhauladhar ranges framed against the blue sky acted as the perfect antidote for our tired bodies and jaded urban eyes. Unbro- ken yards of green fields, tall rows of dense pine,

thick deodar forests and white rivulets of numer- Festive Colours: The Dharamshala Film Festival at McLeod Ganj has a place ous streams form a picture postcard scenario—the Tibetan Institute of Performing Arts is a big draw. for everyone. Here, a whole area exudes a dreamlike calm and freshness. foreign tourist plays the Take a deep breath—can you feel the difference? didgeridoo on a village you down the hill from the main square to Tsug street for some money. The fresh mountain air is uniquely scintillating. la Khang or The Dalai Lama’s temple, which Situated in what is known as the upper is central to the life of McLeod Ganj. A busy 2. Nature’s best Dharamshala (1,830m), McLeod Ganj is bus- place throughout the day—the Namgyal Mon- tling with life yet serene and calm. In the upper astery and the shrine are situated within this recesses at 1,770m is the residence of His Holi- complex—it defies logic as it exudes peace and ness, The Dalai Lama. The lower Dharamshala calm while bursting at the seams with visitors, (1,380 m), in contrast, is a busy commercial hub. devotees, lamas, monks, nuns and the residents. Make your way to one of the many budget Explore the temple, check out Ling Khor, the hotels, homestays or guesthouses tucked into the The view of Mother Nature long meditation trail, and hang a prayer flag from any point in McLeod narrow alleys depending on your purse and taste. Ganj is of boundless or two beside the thousands of colourful ones Most offer clean, tastefully furnished accom- beauty, pristine & pure. already swaying in the breeze on the hillside. modation with views to refresh the soul. Worth If you plan to do all things Tibet first in Little mentioning for a stay are the Tibetan themed 3. Knick Knacks Lhasa, take a spiritual and educational tour to ones that resonate with its culture. From décor to deepen your knowledge of their unique culture. hospitality, all have a distinct flavour and bring Head to the Tibet Museum situated beside Tsug Little Lhasa a little closer to the visitor in spirit. la Khang. The Library of Tibetan Works and For a short weekend jaunt, it’s going to be a Archives is another treasure trove of Tibetan packed schedule. As the bus reaches early in the literary works, barely 20 minutes down the hill morning, you can make a head start after a bath from Tsung la Khang. It is located at Gangchen and hearty breakfast or head out to the popular Tibetan jewellery and Kyishong, right in the centre of McLeod Ganj garments can be bought bakeries or cafés after freshening up, for a at the local flea market. and Kotwali Bazar. You can learn about the his- first luxurious look of the Kangra valley over a tory of this land and its people from the ongo- leisurely breakfast. You can take your pick from 3. In Paradise ing exhibition or riffle through the stacks of over 40 restaurants, cafés and bakeries that dot reference books and photographs on the shelves this place. While on food, and if you are a fan that take you on a pictorial reconstruction of of the factory made momos that have become as the history of Tibet. The library is a renowned natural to Delhi as its dahi bhalle, do try delica- destination for scholars, historians and students cies like chetze, thukpa, kothe and of course from across the world keen to discover Tibet. momos at one of the Tibetan eateries here for an For more detailed understanding of Buddhism, Dharampur is 2 km from authentic taste of Tibet. McLeod Ganj. stop over at Tushita Meditation Centre, a little If by now your interest in Tibet has been above McLeod Ganj, set amid the idyllic charms piqued further by the frequent sightings of of Dharamakot village. The village is located in the maroon robes on the streets, you would be natu- midst of tall pine and rhododendron forests and 5. In Sync rally inclined to drink in the peaceful ambience A conversation offers a bountiful view of the Dhauladhar range. of the Buddhist culture that somehow seems with the It is three km north of McLeod Ganj, and is a cen- so complementary to the serene natural sur- monks tre for the study and practice of the Mahayana can be an roundings. Your feet, of their own volition, lead eyeopener. form of Buddhism. Norbulingka Institute

60 april-may 2014 | www.ibef.org www.ibef.org | april-may 2014 61 tourism update McLeod Ganj

Little Monks: A delightful sight on McLeod Ganj roads are these little monks in distinctive attire.

Prayer Time: For the elders of McLeod Ganj and its nearby villages, dusk is the time for community evening prayers. They sit together in groups and pray wherever they are at the time.

123... That’s the name of this popular café, a favourite haunt of tourists and locals alike. should be your next stop for a detailed insight into Tibetan art and craft. It was established with the specific purpose of preserving and propagating Tibetan arts and crafts for posterity. You will need to spend a day here but it will be well worth the effort. The performing arts of Tibet are a sensorial delight. You From here head on to Naddi village for some can catch some rehearsals or even performances at Tibetan Institute for time away from the hurly burly of McLeod Ganj the Performing Arts which trains students in opera, folk dance and music. and relax in the heart of the Dhauladhar moun- The institute was set up by the Dalai Lama in 1959. tains. Return rejuvenated for some trekking at You may want to pick up a few of the ancient Tibetan remedies from Triund, a 9,000 foot ridge behind the Dhaulad- Tibetan Medical and Astro Institute or Men-Tsee-Khang, located just har range. Triund is 11 km from McLeod Ganj, at some distance down the road from Gangchen Kyishong. Don’t forget to an altitude of 2,827m. The snowline starts mak- pay your respects to the martyrs at Namgyalma Stupa located in the heart ing an appearance just 5km from Triund. Take a of McLeod Ganj. After a leisurely lunch, you can spend the afternoon at deep breath and open your eyes to a world clad Kangra Art Museum discovering the ancient history of Tibetan and Bud- in snow above you and in green beneath you. It dhist cultures since the 5th century. will leave you gasping. Your journey of discovery does not end here though. About one-and-a- There are other popular trekking routes, half hours’ drive from McLeod Ganj is Masroor Temple. Located atop a but we will take the one two kilometers from hill, in its backdrop is the Dhauladhar range (snowcapped in winter) and McLeod Ganj to just below it near Forsyth Ganj. on the campus a beautiful pond. The temple is a group of 15 monolithic It is here that Lord Elgin, the British Viceroy of rock-cut structures and is believed to have been built by the Pandavas in India (1862–63) lies buried under the St. John the epic Mahabharata. It dates back to the 8th century. Another temple Church in the Wilderness. The place, a little that attracts visitors for its tranquil setting is three km from McLeod Ganj, beauty amid the deodar groves, hides an impor- in Bhagsu Village. The eponymous temple with pools around it is a tran- tant bit of the history of India beneath its soils. quil paradise especially with the 30-foot high cascading Bhagsu waterfall Discover it on your stroll. as a backdrop during monsoon months. Pack a picnic brunch and stay There are many other treasures to be explored the day enjoying nature’s bounty. Amid the towering deodar forests some in this little village-town. But before you depart, 3 km from McLeod Ganj is a small lake. This beautiful mid-altitude lake remember to visit Nowrojee and Sons General (1,775 m above sea level) is near a graphically named and idyllic village Store. It has the history of McLeod Ganj run- called Tota Ran. Do take a detour else you will miss out on one of the most ning through its veins for the last five genera- attractive spots in Dharamshala. tions. Catch up with the history here.

62 april-may 2014 | www.ibef.org www.ibef.org | april-may 2014 63 McLeodganj tourism update

62 april-may 2014 | www.ibef.org www.ibef.org | april-may 2014 63 RURAL update

Roadmap of Sustainable Development Drishtee’s vision of an impactful social enterprise guides its unique endeavours at the grassroots. By Sangita thakur varma

rishtee, a word rural development hinges on regular jobs. meaning vision identifying and creating a number Satyan, Co-founder and Manag- in Hindi, has far of milkman routes in a district ing Director of Drishtee, is an reaching connota- through which it caters to a mini- Ashoka fellow and an MBA in tions. Drishtee, mum of 20–25 villages by creat- International Business from Delhi Dthe social enterprise for sustaining an ecosystem of microenter- School of Economics. Mishra, who able communities, also displays prises run by rural entrepreneurs is rooted to his rural Bihar back- a vision whose ambit spreads with focus on women. Satyan Mishra ground, was nominated as the beyond the immediate to the far The foundation of Drishtee co-founded ZDNet Asia’s Technopreneur of the off in the future. So what is this is thus built on the principle of Drishtee with Year later in 2006 and presently is Nitin Gachhayat vision that drives Drishtee? sustainability. It was not that the a member of international forums and Shailesh Siddhartha Shankar, President, founders had a bright idea and Thakur in 1998- like Clinton Global Initiative and Strategy & Business Development, floated a huge outfit pumping 99. Managing Young Asia 21 Forum of Rockefeller Drishtee, explains, “The main in millions of dollars. It was, in Director, Foundation. Drishtee, he is objective of Drishtee is to try and fact, an evolutionary process, built Thakur, a graduate of Delhi an Ashoka fellow create an impact. There are two brick by brick, through a process and an MBA University, leads the new business ways by which you can do this— of hits and misses. The founders in International team as Chief of New Ventures of by creating savings, and there can went to the grassroots for their Business from Drishtee, while Gachhayat, with an Delhi School of be significant savings which are lessons and improved and built MBA from FORE School of Man- Economics. He possible—and the other way is on the basic premise, learning was nominated agement, is the Strategic Thinker to create incomes. We now focus from their mistakes. ZDNet Asia’s and Chief of Functions, and has on the latter that is creating liveli- The social enterprise was floated Technopreneur of been mainly involved with the the Year in 2006 hoods. To do that there are many by three youths around the year functional teams responsible for and is presently things that you have to do along 1998-99—Satyan Mishra, Nitin member of developing new services and appli- the way; one of the things you Gachhayat and Shailesh Thakur— Clinton Global cations for rural India that can then look at is creating accessibility.” who decided to get into entre- Initiative. be sold through Drishtee and other Drishtee’s approach towards preneurship rather than take up kiosk networks.

64 april-may 2014 | www.ibef.org Drishtee RURAL UPDATE

Towards Holistic Empowerment: Drishtee believes in sustainable development whereby both the rural people and the organisation are able to work out a model of transformative and continuous growth.

Shankar throws light on the they trained. Very soon the ser- significant issues in villages is trio’s unusual choice: “All the vices commenced. access—to education, to health, three had rural connect and pas- “The trio realised very quickly to opportunity, to information, sion.” They got their first major that they were creating a huge etc. To create access you need assignment from the district col- value for the people of the village,” to leverage tools like technology. lector of Dhar in Madhya Pradesh. says Shankar. He explains, “To That is the reason why technology The project concerned digitisation get simple certificates like a birth plays a critical role for Drishtee.” of the records of the district and certificate, the transaction cost is E-governance became a very inter- implementation of the govern- tremendous for the villager who esting area, says Shankar. “It was ment’s Government to Citizen also has to stop his work for some a unique kind of e-governance. It Services (GTOC). “This meant days. If you provide him such ser- was initially called GTOC.” that they had to go to villages,” vices for a fee, it saves him a lot of The second phase of Drishtee’s adds Shankar. money and pain.” Soon these ser- evolution involved the realisation They did not have enough vices became popular and gained that the sustainability of their money, young as they were, to recognition. It was also a sustain- e-governance project was on start on a massive scale. So they able service model because there shaky grounds as bureaucratic went to villages and tried to find were a number of villages requir- transfers meant the end of the entrepreneurs whom they could ing similar services. project in that particular district. train for the project. They found “If it is sustainable it is repli- “We found interesting entre- school dropouts and after elabo- cable,” says Shankar. Word spread preneurs in villages, some in a rate research selected boys who and Drishtee began getting invita- remote village who clicked photos, had passion to serve. They trained tions from other districts.“That printed them in dot matrix and these people and explained the is why I call it the first phase of sold each for 50 paise,” reveals commercials to them—they evolution of Drishtee. It was the Shankar. From this realisation would keep 20 per cent of all phase of e-governance.” sprouted the next phase of evolu- earnings and 80 per cent would Shankar points to a key problem tion that involved digital photo go to the village entrepreneurs in the rural sector: “One of the studios. Drishtee encouraged vil-

www.ibef.org | april-may 2014 65 RURAL UPDATE Drishtee

lage entrepreneurs to use digital cameras and ink jet printers. Now someone needing a passport size photograph did not have to go to town. But a bigger realisation for the organisation was the need for its own sustainability. “We realised that entrepreneurs’ sustainability was imperative; and for Drishtee to be sustainable, the entrepreneurial chain had to be sustainable. This photo initiative was one of the measures,” says Shankar. Digital photo service, though reasonably successful, did not translate into a revenue sharing enterprise model for Drishtee. But there were small entrepreneurs who gave village children Building Ecosystem: Drishtee works towards developing a rural entrepreneurial system that is self- basic computer education. Soon sustaining and scalable in the long run and allows more Microsoft came forward to partner micropreneurs to join the mainstream. with Drishtee. “We started teach- ing computers to youth in villages scheme of things. endeavour to optimally utilise and that’s the historic connection Shankar, who has been with services. “We targeted three with IT,” says Shankar, adding, Drishtee for eight years now also ubiquitous services—computer “We must have trained 60,000 to joined around this time. He had education, financial inclusion 70,000 students by now.” left his corporate job of 24 years and health.” Another round of The Microsoft experience gave with ACC in search of a more ful- introspection at this point made them the realisation that Drishtee filling experience. His stint with Drishtee realise that their plat- could be the platform for many United Nations too had left him form was creating small impact private sector services. The next dissatisfied. While working on Drishtee for a large number of people as partners with a phase was the telecentre and rural marketing for ACC he had number of public they were becoming a platform kiosks phase of Drishtee. “We met Satyan and the latter invited and private sector for partner companies. This gave ensured there were private servic- Shankar to spend some time organisations birth to the 4C model where the es, education photography, book- in the village. “The experience like the State big C is the community and the Bank of India, ing of tickets, etc. ICICI came humbled me and I decided to join TCS, Clinton three Cs in the circle that connect forward and gave loan to our Drishtee,” says Shankar, adding “I Global Initiative, to form the triangle are—capacity entrepreneurs. There were many haven’t looked back since.” International for capacity building of the com- services which each of these At this point Drishtee got into Finance munity; channel for linkages for Corporation, entrepreneurs could offer and introspection mode with profes- RICOH, National an enterprise to survive and capi- these were services needed and sional help pouring in. Shankar Skill Development tal to inject into the enterprise. desired by the community and led calls introspection the hallmark of Corporation, For now Drishtee is focussing to savings for the farmers. This Drishtee. The group realised that IFMR Trust, on being a dense enterprise to cre- Ministry of became a sustainable model and they needed to be a rural based, Panchayati Raj, ate maximum impact in the areas impressed the government.” dense organisation with a large Nestle India, where it operates. From building The Drishtee model came number of services and prod- Nike Foundation, a rural BPO, a haat for rural prod- to be known as the common ucts. As this new line of thinking Ministry of Rural ucts to tying up with e-commerce Development, services centre and was later dawned, they started linking up Novartis, gateways like Jabong, Drishtee integrated with the government’s the kirana stores in remote villag- Oiko Credit, is working with a clear vision e-governance initiative. However, es to create a hybrid supply chain Visionspring, for holistic empowerment of the Drishtee perceived the danger of of services and products. This led ACC Ltd, etc. rural people in various parts of becoming a subsidy model in this to the third phase of growth—the India in its focus areas.

66 april-may 2014 | www.ibef.org “Close your eyes and remember your roots. You may hear the whisper...take me home.” BOOKsHELF Bansal Rashmi Author:

Home Calling A book that celebrates small town India. by sangita thakur varma

“Country roads take me home fresh out of our cloying restric- businesses in their home soil About the to the place I belong…” John tive backgrounds, drunk on the Author and today the branches of these Denver immortalised West Vir- heady freedom of a westernised enterprises are spreading across ginia with this hit song in 1971. culture and ready to deny our Rashmi Bansal the country and the globe. There But he did more than that. His own reality. Today, as Bansal is the author of are lessons to be learnt from the folkpop song evoked nostalgia feels, many of us have come to five bestselling struggles of Chandubhai Virani, books targetted in the hearts of the many small realise the value of our suburban at young the wafers man, who started out town folk who had migrated upbringing, and perhaps secretly entrepreneurs as a canteen boy in a cinema to big cities in search of suc- love and yearn like Denver…for and startups. hall and built a business of chips cess. Rashmi Bansal, whose country roads to take us home. Over one million and namkeen in Rajkot that com- copies of her book title uses part of Denver’s Bansal’s book is a reiteration of books are in print mands 65 per cent market share song, effectively strokes the all the values that you find in the and have been in five states. Jaipur Rugs, India’s same feeling of yearning for the interiors of India—a celebration translated into biggest carpet exporter of hand country home in our hearts. of our cultural heritage. Here 10 languages. knotted carpets that employs A writer, Take me Home on the surface there is no tinsel, no false show, entrepreneur 40,000 weavers, had a humble is “the inspiring story of 20 entre- only hard work, grit, passion and youth beginning with two carpet looms preneurs from small town India and a hunger to do something. expert, Rashmi and a few weavers from margin- with big-time dreams”. Scratch Through the stories of these 20 is a mentor and alised communities in Churu in motivational below it and you find layers of entrepreneurs, Bansal is also speaker to Marwar. Nand Kishore Chaud- meaning hidden between the lines. demonstrating an economic fact students hary is today a globally renowned Let’s start with Bansal’s note at about India that the world is and young social entrepreneur. The story of the beginning of the book. How taking note of—that real India entrepreneurs. Parakramsinh Jadeja of Rajkot, a She is an many of us who hail from Patna or lives in its countryside, its small economics school dropout and a budding Patan, Ratlam as in Bansal’s case or towns and cities. The tide is graduate from sportsman who gave up his ambi- Ranchi, Koduvally or Kasganj and finally turning, as she says. Sophia College, tion in face of family hardship the many small towns and cities of The first section of the book Mumbai and and today is the owner of the an MBA from India, have not felt a little ashamed is the story of the Sons of the Indian Institute `1,000 crore (US$ 170.77) Jyoti of our roots among our polished Soil. These are the individuals of Management, CNC, is a lesson in determination, metropolitan counterparts? who never felt the urge to leave Ahmedabad. honesty, passion and dedication. That was perhaps also when home in search of glory. They So are the others in this section. we were young and awkward, set the roots of their humble In recent years, there has been

www.ibef.org | april-may 2014 67 Bookshelf Take Me Home a surge in NRI returnees setting In recent years there has been a surge up businesses in their home towns. Bansal gets up close and in NRI returnees setting up businesses personal with a few of these natives and tries to discover the in their home towns. Bansal gets up motives behind their returning close and personal with a few of to the motherland in the section Return of the Native. For the these to discover the motives behind returnees who have studied in the finest institutions abroad their returning to the motherland in the and worked with the best global section Return of the Native. For the companies, it was swadesh calling, a call hard to ignore. Deepak returnees...it was swadesh calling, a call Dadhoti answered this call believing in his father’s favourite hard to ignore. quote: “Janani janambhoomi shachaswarga dapigariyasi (mother and motherland are greater than who struggled to get a decent Book of each story. It is much like the heaven)”. The engineer by train- job herself despite her degrees Excerpts ‘moral of the story’ that comes at ing set up Servocontrols India and certificates, ensured qual- To my surprise the end of the famous Panchat- in Belgaum, Karnataka, and is ity engineering education for and delight, antra tales. In Bansal’s book, the a key supplier of critical compo- women in Kashmir by setting up I discovered hero of each tale himself provides nents to Indian aerospace and the SSM College of Engineering Robosoft. An a piece of Advice to Young Entre- IT company defence. Integra is the story of a and a polytechnic for women headquartered preneurs. From Nand Kishore couple who built their outsourced in Srinagar. A campus startup in Santhekatte Chaudhary comes the basic gem e-publishing business with just in Kochi is working on a startup (New Udupi) to get one started on the entre- one computer in Puducherry. village to fulfill entrepreneurial but thinking and preneurial journey of self reflec- acting like this There are stories of Sandeep dreams of those like them and was Bangalore. tion: “Before you start anything, Kapoor who left his high paying hopes to create a Silicon Coast Serving global understand yourself. What kind corporate job to return home to in India. It is their dream that clients, creating of work do you enjoy and is that Jodhpur and build a business of one day as the sun sets at dusk innovative apps kind of work needed by others? If and games. perfumes and of Rohith Bhat of in Silicon Valley it will rise at Hungry and yes, you can start that enterprise.” Udupi who has built a `35 crore dawn in Silicon Coast in India. foolish and With this nugget from one (US$ 5.98 million) IT company Impossible you may say, but confident about of the “few good men” that in this small town. For the global read the book to find out how achieving much Bansal introduces in the book more. Indians returning home it has dreams are coming true in small you can ruminate on your been a time of reckoning and towns of India. Bansal has kept To any young crucial startup project before deep introspection, but the call the narrative simple with a man from a you decide to take the jump. of the homeland prevailed. liberal sprinkling of Hindi. The ‘middle class’ Did we hear someone say that background, the The last section is on the good ploy adds an authentic touch world of business dreaming is what foolish people men and women in India’s small to the stories, for small town looks like an elite do? Well here is a piece of advice cities who have put the interest of India is not home to the English club. You can peer from one of the most successful society over personal good. There speaking, blow dried hair crowd, over the hedge natives who returned home to and observe the are people in small town India but the cousins, aunts and party....There is set up one of the top 10 pub- who have a revolutionary take on uncles of whom Bansal speaks, only one way to lishing BPOs worldwide. “We life and its mission, much like with oiled hair and speaking join the party – must first start dreaming. Have A Muruganantham of Jayshree Hindi or the local language. gatecrash it. dreams both in your professional Industries—thinker, philosopher, While the story of each entre- life and personal life,” advises inventor. He is the inventor of preneur itself is inspirational for Sriram Subramanya of Integra. a machine that manufactures Gen-Y and an India in the grip Take these sermons and a low cost sanitary napkins and of an entrepreneurial wave, what journey down memory lane has brought relief to women adds to the content is the short with Take Me Home, a book across India. Dilafroze Qasi, postscript appended at the end that tugs at the heartstrings. A good read indeed!

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