A

Global Country Study Report

On AUTOMOBILE INDUSRTY IN CAMBODIA & Business Opportunities for Gujarat and

Submitted to Institute Code: 735 N.R. Institute of Business Management Ahmedabad In partial Fulfillment of the Requirement of the award for the degree of Master of Business Administration (MBA)

Under the Guidance of Prof. Isha Dave No. Name of Student Enrolment No. 1. Tushal Hareja 147350592043 2. Ashik Khokhar 147350592065 3. Vishal Mehta 147350592085 4. Paresh Rathod 147350592131 5. Vinay Shah 147350592151 6. Mihir Tanna 147350592160

Offered By Gujarat Technological University Ahmedabad

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PLAGIARISM REPORT

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TABLE OF CONTENT

SR.NO. PARTICULARS PAGE NO. 1. Introduction to Cambodia 06

2. Introduction to Himachal Pradesh 24

3. Introduction to Gujarat 32

4. Justification for selection of automobile industry 45

5. Steepled analysis between Cambodia & Gujarat 47

6. Swot analysis of Cambodia 68

7. Swot analysis of Gujarat 74

8. Swot analysis of Himachal Pradesh 77

9. Bilateral trade opportunity between Cambodia & Gujarat 81

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CHAPTER- 1 About the Country Cambodia

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INTRODUCTION OF CAMBODIA

 History of Cambodia The history of Cambodia, a century in mainland South-east Asia, can be found back to at least the 5th millennium BC. Detailed records of a political framework on territory, what is now modern day Cambodia first part in Chinese annals in reference to Funan, a policy that encompassed the southern part of the Indochinese peninsula during the 1st to 6th centuries. Centred at the last Mekong, Funan is noted as the first regional Hindu culture, which suggests protracted socio-economic interplay with maritime trading partners of the Indosphere in the west. By the 6th century a convenances, titled Chenla or Zhenla in Chinese katha, has firmly placed Funan, as it controlled bigger, more undulating spots of Indochina and maintained more than a single centre of power.

The Khmer kingdom was established by the early 9th century. Sources refer here to a mythical initiation and consecration ceremony to claim political legality by founder Jayavarman II at Mount Kulen (Mount Mahendra) in 802 C.E. A succession of powerful sovereigns, continuing the Hindu devaraja culture tradition, reigned over the classical era of Khmer civilization until the 11th century. A new dynasty of hick origin introduced Buddhism as royal religious discontinuities and decentralization result. The royal chronology ends in the 14th century. Great achievements in administration, agriculture, architecture, hydrology, logistics planning and the arts are testimony to a creative and progressive civilization - in its complication a cornerstone of Southeast Asian cultural legacy.

A transitional time around 100 years followed, that initiated the Dark Ages or the Middle Period of Cambodian history in the mid fifteenth century. Although Hindu culture had been all but replaced, the monument sites at the old metropolis remained an important spiritual center. Yet since the mid 15th century the core population steadily moved to the east and stable at the juction of the Mekong and Tonle Sap rivers at Chaktomuk, Longvek and Oudong.

Maritime trade was the basis for a very large handed 16th century. But, as a result foreigners - Muslim Malays and Cham, Christian European feat and missionaries - increasingly disturb and influence government affairs. Vague fortunes, a robust economy on the one hand & a disturbed culture and compromised royalty on the other are continuing features of the Longneck era.

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By the 15th century, the Khmers' styffy neighbours, the Mon people in the west and the Cham people in the east had successively been pushed aside or replaced by the resilient Siamese/Thai and Vietnamese. These powers had perceived, self understanding and increasingly followed the imperative of controlling the lower Mekong basin as the key to control all Indochina. A weak Khmer empire only encouraged the strategists in Ayutthaya (later Bangkok) and Hu?. Attacks on and conquests of Khmer royal residences left sovereigns without a fiesta and legit power base. Interference in succession and marriage policies added to the decay of royal status. Oudong was established in 1601 as the last royal place of the Middle Period.

The 19th century arrival of technologically better and ambitious European colonial powers with policies of hard control put an end to regional riots and as Thailand, although humiliated and on the retreat, escaped colonization as a buffer state, Vietnam was to be the centre point of French colonial ambition. Cambodia, although largely neglected, had entered the Indochinese Union territory as a perceived entity and was capable to carry and reclaim its identity and integrity into modernity.

After 80 years of pukka hibernation, the brief episode of Japanese occupation during World War II, that match with the investiture of king Sihanouk was the opening act for the unalterable process towards re-emancipation and modern Cambodian history. The empire of Cambodia (1953–70), independent since 1953, struggled to remain coastal in a world by polarisation of the nuclear powers USA and Soviet Union. As the Indochinese war sharpens, Cambodia becomes increasingly involved, the Khmer country is one of the results in 1970, another is civil war. 1975, derelict and in the hands of the Khmer Rouge, Cambodia suffer its darkest hour - Democratic Kampuchea and its long result of Vietnamese trade, the People's Republic of Kampuchea and the UN rulers towards Modern Cambodia since 1993.

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 Name The official name of the country is the empire of Cambodia and in Khmer as (Preah Reacheanachak Kampuchea), often shortened to Kampuchea. Kampuchea derives from the Sanskrit word Kambuja or "Golden Land" or "Land of Peace and Prosperity", as described by the Khmer Buddhist friar Chuon Nath in his Khmer Dictionary.

Cambodians refer to as, meaning "Khmer's Land" or more as Prateh Kampuchea, "Country of Kampuchea". Kampuchea is generally known as "Cambodia" in british and "Cambodge"&"Kamboj" in French. Kampuchea is mostly known to Easterners and Cambodia is more widely known to Westerners. The word Khmer can indicate the country, its people or its language.

 Geographic Location Cambodia has a land area of 181,035 square Km in the south-western part of the Indochina peninsula, about 20% of which is used for agriculture. It lies fully within the tropics with its southern most points narrowly more than 10° above the Equator. The country capital city is Phnom Penh.

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International borders are shared with a Thailand & the Lao People‘s Democratic Republic on the West and the North, & the social Republic of Vietnam on the East & Southeast. The country is bounded on the Southeast by the Gulf of Thailand. In comparison with neighbours, Cambodia is a geographical contact country administratively composed of 20 territory, three of which have relatively short nautical boundaries, 2 municipalities, 172 districts, and 1,547 communes. The country has a coastline of 435 km and vast mangrove stands, some of which are relatively undisturbed.

 Language of Cambodia The Cambodian language is Khmer, which is hereditary itself - and advanced in education with application of Indic languages Pali and Sanskrit from India. Also, the Khmer language is influenced by spoken and written Thai. Some technical languages are borrowed from French. However, English is generally communicated in hotels and business compounds at present days. English and French are popular 2nd languages and Chinese‘s is the third.

 National Anthem

The anthem was particularly adopted in 1941 and reconfirmed in 1947, around the time of independence from France. In 1970, the empire was abolished, thereby replacing the carol as well. After the communist victory in 1975, former royalist symbols, including ―Nokoreach‖, were redentegrate for a short while until replaced with their own national symbols. During exile, the 2nd verse of Nokoreach was declared to be the anthem of Cambodia; after the royalist forces defeated the Vietnamese stooge regime in 1993, putting an end to their long civil war, the royalist anthem (all verses) was also restored to Cambodia. The status of the anthem is derived from the name of an ancient Khmer kingdom.

"Nokor Reach" is the national anthem of the Kingdom of Cambodia. It was based on a Cambodian folk tune and written by Chuon Nath; the anthem was originally adopted in 1941 and reconfirmed in 1947, around the time of independence from France. In 1970, the monarchy was abolished, thereby replacing the anthem as well. After the communist victory in 1975, former royalist symbols, including "Nokor Reach", were reinstated for a short while. The Khmer Rouge then replaced it with Dap Prampi Mesa Chokchey ("Glorious Seventeenth of April"). After the

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royalist party FUNCINPEC defeated the former communists (Cambodian People's Party) in the 1993 elections, the royalist anthem was restored.

 National Flag

The Cambodia flag is a curve of red and blue with an image of Angkor Vat placed at the centre of it. The flag was originally adopted in 1993. It was officially adopted on October 29, 1948 and remained until Oct 1970. In 1993, with the re-establishment of the Cambodian kingdom the Cambodian flag once again restructured. Angkor Vat, a Hindu temple, an integral and efficient part of the rich heritage of Cambodia proudly adorns the century flag. The blue colour symbolizes the nation's royalty. The red represents the nation and the white represents the religion. The emblem of the temple represents the structure of the unity.

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 Government Originally a multiparty democracy, in reality "the country remains a one-party state dominated by the Cambodian People's Party and PM Hun Sen, a recast Khmer Rouge in power since 1985. The open doors to new investment during his reign have yielded the most use to a coterie of cronies of his and his wife, Bun Rany." Cambodia's government has been explain by Human Rights Watch's Southeast Asian Director, David Roberts, as a "vaguely communist free-market state with a relatively authoritarian coalition over a superficial democracy."

Prime Minister Hun Sen has vowed to kingdom when he is 74. He is a former Khmer Rouge member who defected. His government is regularly accused of ignoring human rights and suppressing political disagree . The 2013 election results were disputed by Hun Sen's opposition, leading to demonstrations in the capital. Manifestation were injured and killed in Phnom Penh where a reported 20,000 protesters gathered, with some clashing with riot police. From a meek farming background, Hun Sen was 33 when he took power in 1985, and is now in the organization of other long ruling dictators such as Zimbabwe's Robert Mugabe and Kazakhstan's Nursultan Nazarbayev'.

National politics in Cambodia took place within the framework of the nation's constitution of 1993. The government is a constitutional empire operated as a parliamentary representative democracy. The PM of Cambodia, an office held by Hun Sen since 1985, is the chief of government, while the King of Cambodia is the head of state. The prime minister is appointed by the king, on the advice and with the sanction of the National Assembly. The prime minister and the ministerial appointees practice executive power.

Legislative powers are shared by the executive and the bicameral Parliament of Cambodia, which include a lower house, the National Assembly and an upper house, the parliament. Members of the 123-seat Assembly are elected through a system of relative representation and serve for a maximum term of five years. The governing body has 61 seats, two of which are selected by the king and two others by the National Assembly, and the rest elected by the converse councillors from 24 provinces of Cambodia. Senators serve six-year terms.

On 14 October 2004, King Norodom Sihamoni was elected by a special nine-member throne council, part of a selection procedure that was quickly put in place after the resignation of King

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Norodom Sihanouk a week prior. Sihamoni's election was legitimate by Prime Minister Hun Sen and National Assembly Speaker Prince Norodom Ranariddh, both members of the throne council. He was enthroned in Phnom Penh on 29 Oct 2004.

 Political culture The Cambodian People's Party is the main ruling party in Cambodia. The CPP controls the lower and higher chambers of parliament, with 68 seats in the National legislative body and 46 seats in the council. The opposition Cambodia nationalized Rescue Party (CNRP) is the 2nd largest party in Cambodia with 55 seats in the National Assembly but has yet to participate in any council elections. The Sam Rainsy Party has 11 seats in the governing body.

Hun Sen and his government have seen much debate. Hun Sen was a previous Khmer Rouge chief who was formerly installed by the Vietnamese & after the Vietnamese left the country, maintains his strong man place by violence and domination when deemed necessary. In 1997, fear the increasing power of his co-Prime Minister, Prince Norodom Ranariddh, Hun launched a coup, using the army to wash out Ranariddh and his followers. Ranariddh was ousted and fled to Paris while other opponents of Hun Sen were detained, tortured and some suddenly executed.

In addition to political domination, the Cambodian government has been accused of fraud in the sale of huge areas of land to foreign investors ensuing in the eviction of thousands of villagers as well as taking bribes in exchange for grants to utilize Cambodia's oil wealth and mineral resources. Cambodia is constantly listed as one of the most fraudulent governments in the world. Reprieve global currently recognizes one prisoner of sense of right and wrong in the country: 29- year-old land rights protester Yorm Bopha.

Journalists covering a protest over dubious election results in Phnom Penh on 22 September 2013 say they were intentionally attacked by police and men in plain clothes, with slingshots and stun guns. The attack against the President of the abroad Press Club of Cambodia, Rick Valenzuela, was captured on video. The violence came among political tensions as the opposition boycotted the opening of Parliament due to concerns about electoral scam. Seven reporters continued minor injuries while at least two Cambodian protesters were hit by slingshot projectiles and hospitalized.

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 Foreign relations The foreign associations of Cambodia are handled by the Ministry of Foreign Affairs under H.E. Hor Namhong. Cambodia is a member of the UN, the World Bank, and the global Monetary Fund. It is a member of the Asian Development Bank, ASEAN, and tied the WTO in 2004. In 2005 Cambodia attended the opening East Asia Summit in Malaysia.

Cambodia has established diplomatic associations with numerous countries; the government reports twenty embassies in the country include many of its Asian neighbours and those of important players during the Paris peace consultation, including the US, Australia, Canada, China, the European Union (EU), Japan, and Russia. As a result of its international relations, various charitable organizations have assisted with social, economic, and civil infrastructure needs.

While the violent ruptures of the 1970s and 1980s have passed, several border disputes between Cambodia and its neighbors persist. There are disagreements over some offshore islands and sections of the boundary with Vietnam and undefined maritime boundaries and border areas with Thailand. Cambodian and Thai troops have clashed over land immediately adjacent to the Preah Vihear temple, leading to deterioration in relations.

 Economy of Cambodia The' economy of Cambodia' at present follows an open market system (market economy) and has seen rapid economic progress in the last decade. Cambodia had a GDP of $13 billion in 2012. Per capita income, although rapidly increasing, is low compared with most neighboring countries. Cambodia's two largest industries are textiles and tourism, while agricultural activities remain the main source of income for many Cambodians living in rural areas. The service sector is heavily concentrated on trading activities and catering-related services. Recently, Cambodia has reported that oil and natural gas reserves have been found off-shore.

In 1995, the government transformed the country's economic system from a planned economy to its present market-driven system. Following those changes, growth was estimated at a value of 7% while inflation dropped from 26% in 1994 to only 6% in 1995. Imports increased due to the influx of foreign aid, and exports, particularly from the country's garment industry, also increased.

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After four years of improving economic performance, Cambodia's economy slowed in 1997-98 due to the regional economic crisis, civil unrest, and political infighting. Foreign investments declined during this period. Also, in 1998 the main harvest was hit by drought. But in 1999, the first full year of relative peace in 30 years, progress was made on economic reforms and growth resumed at 4%.

Currently, Cambodia's foreign policy focuses on establishing friendly borders with its neighbors (such as Thailand and Vietnam), as well as integrating itself into regional (ASEAN) and global (WTO) trading systems. Some of the obstacles faced by this emerging economy are the need for a better education system and the lack of a skilled workforce; particularly in the poverty-ridden countryside, which struggles with inadequate basic infrastructure. Nonetheless, Cambodia continues to attract investors because of its low wages, plentiful labor, proximity to Asian raw materials, and favorable tax treatment.

In 2012 Credit Bureau Cambodia was established with direct regulatory oversight by the National Bank of Cambodia. The Credit Bureau further increases the transparency and stability within the Cambodian Banking Sector as all banks and microfinance companies are now required by law to report accurate facts and figures relating to loan performance in the country.

One of the largest challenges facing Cambodia is still the fact that the older population often lacks education, particularly in the countryside, which suffers from a lack of basic infrastructure. Fear of renewed political instability and corruption within the government discourage foreign investment and delay foreign aid, although there has been significant aid from bilateral and multilateral donors. Donors pledged $504 million to the country in 2004, while the Asian Development Bank alone has provided $850 million in loans, grants, and technical assistance. Bribes are often demanded from companies operating in Cambodia when obtaining licences and permits, such as construction-related permits.

Cambodia ranked among the worst places in the world for organised labour in the 2015 International Trade Union Confederation (ITUC) Global Rights Index, landing in the category of countries with ―no guarantee of rights‖

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 Demographics As of 2013, Cambodia has an estimated population of 15,205,539 people. Cambodia's birth rate is 25.4 per 1,000. Its population growth rate is 1.7%.

50% of the Cambodian population is younger than 22 years old. At a 1.04 female to male ratio, Cambodia has the most female-biased sex ratio in the Greater Mekong Subregion.Amongst the Cambodian population aged over 65, the female to male ratio is 1.6:1.

The total fertility rate in Cambodia was 3.0 children per woman in 2010.The fertility rate was 4.0 children in 2000. Women in urban areas have 2.2 children on average, compared with 3.3 children per woman in rural areas. Fertility is highest in Mondol Kiri and Rattanak Kiri Provinces, where women have an average of 4.5 children, and lowest in Phnom Penh where women have an average of 2.0 children.

 Religion Buddhism is the official religion of Cambodia, practiced by more than 95 percent of the population with an estimated 4,392 monastery temples throughout the country. Cambodian Buddhism is deeply pervaded by Hinduism, Tantrism, and native animism. Key concepts in Cambodian Buddhism include bonn (Pali punna, merit), reincarnation, and kamm (Pali kamma, karma), which means the moral result accruing from action in Pali but a concept closer to "misfortune" in Khmer.

Key concepts deriving from animism include the close interrelationship between spirits and the community, the efficacy of apotropaic and luck-attracting actions and charms, and the possibility of manipulating one's life through contact with spiritual entities such as the "baromey" spirits. Hinduism has left little trace beyond the magical practices of Tantricism and a host of Hindu gods now assimilated into the spirit world (for example, the important neak ta spirit called Yeay Mao is the modern avatar of the Hindu goddess Kali).

Mahayana Buddhism is the religion of the majority of Chinese and Vietnamese in Cambodia. Elements of other religious practices, such as the veneration of folk heroes and ancestors, Confucianism, and Taoism mix with Chinese Buddhism are also practiced.

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Islam is followed by about 2% of the population and comes in three varieties, two practiced by the Cham people and a third by the descendants of Malays resident in the country for generations. Cambodia's Muslim population is reported to be 80% ethnic Cham

 Education The Ministry of Education, Youth and Sports is responsible for establishing national policies and guidelines for education in Cambodia. The Cambodian education system is heavily decentralised, with three levels of government, central, provincial and district – responsible for its management. The constitution of Cambodia promulgates free compulsory education for nine years, guaranteeing the universal right to basic quality education.

The 2008 Cambodian census estimated that 77.6% of the population was literate (85.1% of men and 70.9% of women). Male youth age (15–24 years) have a literacy rate of 89% compared to 86% for females.

The education system in Cambodia continues to face many challenges, but during the past years there have been significant improvements, especially in terms of primary net enrollment gains, the introduction of program basedbudgeting, and the development of a policy framework which helps disadvantaged children to gain access to education. The country has also significantly invested in vocational education, especially in rural areas, in order to tackle poverty and unemployment. Two of Cambodia's most acclaimed universities are based in Phnom Penh.

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Traditionally, education in Cambodia was offered by the wats (Buddhist temples), thus providing education exclusively for the male population. During the Khmer Rouge regime, education suffered significant setbacks.

With respects to academic performance among Cambodian primary school children, research showed that parental attitudes and beliefs played a significant role. Specifically, the study found that poorer academic achievement among children were associated with parents holding stronger fatalistic beliefs (i.e., human strength cannot change destiny). The study further found that "length of residence" of parents in the community in which they stay predicted better academic achievement among their children.

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Trade, growth and poverty in Cambodia

Cambodia has established a remarkable track record of economic growth over the past 10 years. Between 1997 and 2007, the economy grew at close to 10% per annum during the entire period. Vigorous economic growth has also translated into important reductions in poverty, with per capita income more than doubling, from $285 to $593, and the poverty rate declining from 45- 50% in 1993/94 to 30% in 2007 (World Bank, 2009). However, inequality has increased over this period, undermining future potential for growth.

Cambodia‘s sustained economic expansion has been driven in large part by rapid export growth. Foreign sales have increased by more than 20% per year since 1998, and exports in goods and services accounted for 65% of gross domestic product (GDP) in 2007 (World Bank, 2008a). Cambodia‘s textile and garment industry has been the cornerstone of this export performance, for 16% of GDP in 2007 and 2.4 points of GDP growth between 1998 and 2007. Despite Cambodia‘s poor overall governance, public–private collaboration in the sector has created an enabling environment conducive to growth (World Bank, 2009).

For over 10 years, foreign sales in the industry grew at approximately 28% per year, from only around $26 million in 1995 to almost $2.8 billion in 2007 (ILO, 2008). More than half the 280,000 skilled and unskilled jobs in the industry in 2006 were created over the five preceding years, making the industry by far the largest source of job growth during this period (Polaski, 2006). Moreover, between 85% and 90% of these jobs have gone to women workers, which implies an important positive impact on women‘s empowerment in Cambodia. Finally, about 90% of workers send home an average of 50% of their wages to support their families in their villages of origin, thus helping to boost the standard of living in rural areas (MoC/ADB, 2004). This expansion in the garment sector has been complemented by growth in the tourism sector. The hotel and restaurant industry represents 4% of GDP and contributed 0.5 points of GDP growth from 1998-2007. Despite the important increases in these industries, Cambodian households remain heavily dependent on agriculture. 59% of households depend on agriculture as their primary source of income.

Approximately 250,000 young Cambodians are entering the labour market per year (often with decreasing access to land resources), so the generation of adequate employment opportunities is

19 | P a g e of particular importance. To generate employment opportunities, broadening Cambodia‘s export base and diversifying the economy as a whole are key. Cambodia‘s heavy dependence on the garment sector is an important vulnerability, one which has become painfully exposed during the current economic downturn. In January 2009, garment exports contracted to less than 30% of their value in 2008, and more than 20,000 workers are reported to have lost their jobs in the garment sector since the beginning of 2009. Simultaneously, the tourism sector has seen foreign arrivals drop by % compared with 2008. As a result, International Monetary Fund (IMF) estimates of current growth prospects are negative (Chun Sophal and Hor Hab, 2009).

List of Industry in cambodia

 Cement Industry  Media  Telecommunication  Tourism ( Widely Known)  Conglomerate  Consumer Goods  Financial  Industrial Manufacturers  Oil and Gas  Utilities

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 Contribution Towards GDP Cambodian economy maintained high growth of more than 10% p.a. for four consecutive years between 2004 and 2007. While GDP growth dropped to 0.1% in 2009, having suffered from world economic recession started in the latter half of 2008, GDP growth rate in 2013 recovered up to 6.0%.According to the MEF‘s forecast, the growth rates are estimated to persist between 6.0% and 6.5% in 2014 and 2015GDP amount has been steadily grown with 43,057 billion Riels in 20012 and 47,048 billion Riels in 2013 and is projected to be 52,141 billion Riel in 2014 (approximately USD 12.9 billion) and 57, 363 billion Riel in 2015(approximately USD 14.2 billion).Per capita GDP has also steadily increased since 1998 when the Riel greatly depreciated against the dollar. Per capita GDP in 2010 reached USD 830, an increase of approximately 70% from 487 US dollars in 2009. It is projected to reach USD 904 in 2014 and USD 984 in 2015 respectively, according to the MEF‘s forecast.

Overview of Automobile industry in Cambodia

 Cambodia’s total GDP is  Angkor Heavy motor co. ltd. 16.77 billion USD.

 Toyota co. ltd.  Cambodia represents

 Premium auto –BMW Cambodia 0.03% in world’s GDP.

 Star auto (Mercedes) co. ltd.

 Land rover service center

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Table II-1-1 GDP Growth Rate by Economic Activity, 2008-2014 Industry 2008 2009 2010 2011 2012 2013 2014e Agriculture, Fisheries & Forestry 15.7 5.5 5 5.7 5.4 4 3.6 Crops 27.6 5.3 8.2 6.6 5.8 5.7 3.7 Livestock & Poultry 5.6 8.2 3.7 3.8 5 5.6 3.9 Fisheries 5.6 3.8 0.8 6.5 6 0.4 3.8 Forestry & Logging 5.1 7 1.1 0.9 1.1 0.2 1.1 Industry 12.7 18.3 8.4 4 -9.5 13.6 8.5 Manufacturing 9.7 17.4 8.9 3.1 -15.5 29.6 9 Textile, Apparel & Footwear 9.2 20.4 10 2.2 -9 18.5 10.4 Construction 22.1 20 6.7 5.8 5 -25.5 6.4 Services 13.1 10.1 10.1 9 2.3 3.3 6.3 Trade 8.5 7.1 9.5 9.4 4.2 7.5 6 Hotel & Restaurant 22.3 13.7 10.2 9.8 1.8 11.2 10.7 Transport & Communication 14.5 2.1 7.2 7.1 3.9 8 6.8 Real Estate & Business 7.8 10.9 10.7 5 -2.5 -15.8 5.1 Other Services 18.3 17.2 12.1 12 2.9 4.2 4.6 Taxes on Products 6.1 7.6 45.7 9.1 6.1 0.1 4.1 GDP 13.3 10.8 10.2 6.7 0.1 6 6

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 Export Import Statistic

 Export Statistic

Top 10 Export Top 10 Export

Partners Partners United States United States $2,032,783,642 Hong Kong Hong Kong $1,682,658,567 Singapore United Kingdom Singapore $684,668,761 Germany United Kingdom $528,030,062 Canada Germany $469,721,535 Japan Canada $417,036,525 China Japan $199,167,533 Belgium China $182,895,514 Spain Belgium $163,347,610 Spain $149,861,809

 Importer Data

Top Importers Import Volume China $2,162,204,603 Vietnam $937,012,554 China Thailand $902,257,532 Vietnam Thailand Hong Kong $495,419,829 Hong Kong Korea, South $404,436,946 Korea, South Singapore $258,429,954 Singapore Japan $222,987,165 Japan Indonesia $215,672,606 Indonesia Malaysia $175,416,043 Malaysia United States United States $151,882,814

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CHAPTER- 2

Introduction to Himachal

Pradesh

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Overview of Himachal Pradesh

Facts on Himachal Pradesh

Date of Formation Jan 25, 1971

Area 55,673 sq km

Density 123/Km2

Population (2011) 6,864,602

Males Population (2011) 3,481,873

Females Population (2011) 3,382,729

No. of District 12

Capital Shimla

Rivers Ravi, Beas, Chenab, Sutlej, Yumana

Pin Velley NP, Greater Himalaya NP, Renuka WS, Chail WS, KalatopeKhajjiar WS, Forests & National Park Simbalbara WS

Languages Hindi, English, Punjabi, Kinnauri, Pahari, Kangri and Dogri

Neighbours State Jammu and Kashmir, Punjab, Haryana, Uttar Pradesh, Uttrakhand

State Animal Snow Leopard

State Bird Western Tragopan

State Tree Deodar

State Flower Pink Rhododendron

Net State Domestic Product 65535 (2011)

Literacy Rate (2011) 68.74%

Females per 1000 males 974

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Assembly constituency 68

Parliamentary constituency 4

 Religion

Hinduism is the main religion in Himachal Pradesh, which ranks first in India in terms of the proportion of Hindus present within it. More than 95% of the total population belongs to the Hindu faith, the distribution of which is evenly spread throughout the state. Himachal Pradesh thushas the one of the highest proportion of Hindu population in India (95.17%).

Other religions that form a small percentage are Buddhism and Sikhism. The Lahaulis of Lahaul and Spiti region are mainly Buddhists. Sikhs mostly live in towns and cities and constitute 1.16% of the state population. For example they form 10% of the population in Una District adjoining the state of Punjab and 17% in Shimla, the state capital. The Buddhists constitute 1.15% are mainly natives and tribals from Lahaul and Spiti, where they form majority of 60% and Kinnaur where they form 40%, however the bulk are refugees from Tibet. The Muslimsconstitute slightly 2.18% of the population of Himachal Pradesh.

Muslims are mainly present in the Chamba and Solan districts, whilst the minority Buddhist population primarily resides in the Lahul&Sapiti and Kinnour districts. The tiny Catholic minority has its own Roman Catholic Diocese of Simla and Chandigarh, which has its cathedral see in Simla and a co-cathedral in Chandigarh.

 Natural resources

Soil and Minerals

The State of Himachal Pradesh has varieties of soil found in it. They are Brown, Brown-Grey and Sedimentary soils. Presence of these types of soils are helpful in agriculture and are mostly found in the places Shimla, Kangra, Kullu, Hamirpur, Solan and Una. These states are huge producers of crops.

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Himachal Pradesh has rich source of minerals like Mica, Uranium, Iron Ore, Limestone, Lead, Slate, and Gypsum which has helped in setting up industries in different districts of the state.

Forest

A large part of Himachal Pradesh State is covered with forest. The state has forest area categorized into 6 important types. The total area covered by forest is about 21,325 Sq Km. the forest types of this state are- Mountain Temperate Region, Mountain sub-tropical region, Sub- Alpine Region, Moist Tropical Region, Alpine-Scrub Region and Dry Tropical Region. Southern parts of Himachal Pradesh fall under sub-tropical/sub-tropical moist forest areas. The important trees found in this region are Shisam and Sal trees.

Lakes

Himachal Pradesh is blessed with numerous lakes ranging from big to small ones. 1% of the entire area of this state has lakes. Some of these lakes are natural ones and have been created centuries ago. These lakes get water from springs that are created by melting of mountain snow and through underground.

Some of the famous lakes of Himachal Prades are MaharanaPratapSagar Lake Kangra, GobindSagar Lake Bilaspur, Chamba, Chamba, Mandi, Chandra Tal Lake Kunzum Pass, Suraj Tal Lake, Dashir Lake Manali, Kinnaur, Mandi, Lama Dal Lake Chamba.

Rivers

Himachal Pradesh has many small rivers flowing through the state but there are five major rivers passing through the state. The famous rivers are Sutlej River, Beas River, Ravi River, Chenab River, Yamuna River etc.

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Passes

Himachal Pradesh is blessed with numerous lakes ranging from big to small ones. 1% of the entire area of this state has lakes. Some of these lakes are natural ones and have been created centuries ago. These lakes get water from springs that are created by melting of mountain snow and through underground.

Some of the famous lakes of Himachal Prades are MaharanaPratapSagar Lake Kangra, GobindSagar Lake Bilaspur, Khajjiar Lake Chamba, Manimahesh Lake Chamba, Prashar Lake Mandi, Chandra Tal Lake Kunzum Pass, Suraj Tal Lake, Dashir Lake Manali, Nako Lake Kinnaur, Rewalsar Lake Mandi, Lama Dal Lake Chamba.

 Transportation Most of the part of Himachal Pradesh being mountainous, development of proper transport facilities was difficult. However, the government has made notable progress in connecting the roads to the state and today Himachal Pradesh is known to have the highest density of roads among all major hill stations of the country. There are 8 national highways that connect the state with the rest of the country. Inside the state, all the tourist spots are connected through roads for the benefits of travellers. Within the city, people prefer private vehicles and buses to communicate from one part to the other. Two railway stations connect the state with the other part of the country, the Kalka Shimla railways and the Pathankot-Jogindernagar railways. Few more tracks have been proposed by the government for better connectivity. With three airports in the state - Shimla airport near the capital, the Gaggal airport near the Kangra District, and the Bhuntar airport just near to the Kullu District - Himachal Pradesh can be reached through airways as well. However, due to improper weather conditions, most of these flights either get delayed or cancelled in most of the days, causing much inconvenience to the passengers.

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 Major Industries

Agriculture Agriculture is the main occupation of the people of Himachal Pradesh and has an important place in the economy of the state. It provides direct employment to 69 per cent of the total workers of the state. About 21 per cent of the total GSDP comes from agriculture and its allied sectors. Rice, Wheat and Maize are important cereal crops of the State. Groundnut, soybean and sunflower in kharif and rapeseed/mustard and toria are important oilseed crops in the rabi season. Urd, bean, moong, rajmash in kharif season and gram in rabi are the important pulse crops of the state. Agro-climatically, the state can be divided into four zones viz., (i) Sub Tropical, sub- mountain and low hills, (ii) Sub Temperate, Sub Humid mid hills, (iii) Wet Temperate high hills, (iv) Dry Temperate high hills and cold deserts. The agro-climatic conditions are congenial for the production of cash crops like off-season vegetables, potato and ginger. The State Government is laying emphasis on production of off- season vegetables, potato, ginger, pulses and oilseeds besides increasing production of cereal crops, through timely and adequate supply of inputs, demonstration and effective dissemination of improved farm technology, replacement of old variety seeds, promoting integrated pest management, bringing more area under efficient use of water resources and implementation of wasteland development projects. There are four distinct seasons with respect to rainfall. Almost half of the rainfall is received during the Monsoon season and remaining is distributed among other seasons.

Agro based industries Himachal Pradesh is predominately an agricultural state. The natural endowments like soil, land, water etc. are being harnessed in such a way that the cherished goals of ecological sustainability and economic upliftment of farming community are achieved. About 18-20 per cent area is irrigated and rest is rain fed. Huge investment potential exists in the following fields:

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Tea Plantation: Management of tea factories and tea gardens.

Food Processing: Maize is an important crop where surplus is available for processing. Under the state Industrial Policy, number of incentives are available to the investors in food processing industry. Processing industries of ginger, potato and vegetables in valley areas have great investment scope.

Seed Production: The temperate climate of the state is quite suitable for production of disease free seed. The Government is encouraging private sector participation for exploitation of vast seed production potential.

Biotechnology Himachal has the potential to develop various types of industries using raw material base of fruits, vegetables, high value cash crops and other naturally growing herbal plants. These industries can be in the following: bio-pharmaceuticals, phyto- chemicals, bio-prospecting, fermentation, post-harvest processing, bio-processing, pharmaceuticals, biochemical, genetically engineered micro-organisms, enzyme production, environment protection and animal husbandry etc.

Himachal has tremendous potential in horticultural sector. The state needs immediate replacement of old orchard with high yielding disease free fresh planting stock. Biotechnology can play important role by use of micro propagated plants. With this the industries for cider, vinegar, wine and juice can come up to international standard. The horticulture sector also needs a facelift using hi-tech biotechnological interventions at nursery, orchard, post-harvest, processing, packaging and marketing stages. The Horticulture Technology Mission launched in the State will prove to be a major milestone in strengthening the developmental activities through technological inputs. In agriculture sector there is need for diversification of farming for economic rehabilitation and self-sufficiency. High yielding improved crop verities and transgenic especially stress tolerant (cold, rain fed conditions), biofertilzers, bio pesticides etc. are other areas where Biotechnology can play major role.

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Tourism Tourism has been recognized as one of the most important/significant sectors of the economy in Himachal Pradesh and has been recognized as a major engine of growth for future. The state has a natural advantage for the development of tourism as an industry. It is endowed with geographical and cultural diversity, clean, peaceful and beautiful environment owing to its forests, lakes, mountains, rivers and rivulets, sacred shrines, historic monuments and the friendly and hospitable people. Tourism industry has been given very high priority and the government has developed appropriate infrastructure for its development, which includes provision of public utility services, roads, communication network, airports, transport facilities, water supply, civic amenities, etc.

Contribution of Himachal Pradesh in GDP of India

According to 2013-2014, Himachal Pradesh has contributed net worth 82,585crores INRin GDP of India

Overview of automobile industry in Himachal Pradesh

 Automobile industry is contributing about 7% in total

 TVS motors GDP of India.

 India’s total GDP is 2066.90  International cars & Motors Ltd. billion USD  TAFE Tractors  It represents 3.33% in world’s

GDP.

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CHAPTER- 3

Introduction to Gujarat & Overview of Automobile Industry in INDIA

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DETAILS OF SELECTED INDUSTRY WITH REFERENCE TO GUJARAT

History

Historically, the state of Gujarat has been one of the main centres of the Indus Valley Civilization. It contains major ancient metropolitan cities from the Indus Valley such as Lothal, Dholavira, and Gola Dhoro. The ancient city of Lothal was where India's first port was established. Also, Dholavira, the ancient city, is one of the largest and most prominent archaeological sites in India, belonging to the Indus Valley Civilization. The most recent discovery was Gola Dhoro. Altogether, about 50 Indus Valley settlement ruins have been discovered in Gujarat. The ancient history of Gujarat was enriched by their commercial activities. There is a clear historical evidence of trade and commerce ties with Egypt, Bahrain and Sumer in the Persian Gulf during the time period of 1000 to 750 BC. There was a succession of Hindu and Buddhist states such as the Mauryan Dynasty, Western Satraps, Satavahana dynasty, Gupta Empire, Chalukya dynasty, Rashtrakuta Empire, Pala Empire and Gurjara- Pratihara Empire, as well as local dynasties such as the Maitrakas and then the Solankis.

The early history of Gujarat reflects the imperial grandeur of Chandragupta Maurya who conquered a number of earlier states in what is now Gujarat. Pushyagupta, a Vaishya, was appointed governor of Saurashtra by the Mauryan regime. He ruled Giringer (modern day Junagadh) (322 BC to 294 BC) and built a dam on the Sudarshan lake. Emperor Ashoka, the grandson of Chandragupta Maurya, not only ordered engraving of his edicts on the rock at Junagadh, but asked Governor Tusherpha to cut canals from the lake where an earlier Mauryan governor had built a dam. Between the decline of Mauryan power and Saurashtra coming under the sway of the Samprati Mauryas of Ujjain, there was a Greek incursion into Gujarat led by Demetrius. In the first half of the first century A.D. there is the story of a merchant of King Gondaphares landing in Gujarat with Apostle Thomas. The incident of the cup-bearer killed by a LION might indicate that the port city described is in Gujarat.

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Geographical Location:

Gujarat borders Pakistan's Sindh province to the northwest, is bounded by the Arabian Sea to the southwest, the state of Rajasthan to the northeast, Madhya Pradesh to the east, and by Maharashtra, Union territories of Diu, Daman, Dadra and Nagar Haveli to the south. Historically, the north was known as Anarta, the Kathiawar peninsula, "Saurastra", and the south as "Lata". Gujarat was also known as Pratichya and Varuna. The Arabian Sea makes up the state's western coast. The capital, Gandhinagar is a planned city. Gujarat has an area of 75,686 sq mi (196,030 km2) with the longest coast line (24% of Indian sea coast) 1,600 kilometres (990 mi), dotted with 41 ports: one major, 11 intermediate and 29 minor.

The Sabarmati is the largest river in Gujarat followed by the Tapi, although the Narmada covers the longest distance in its passage through the state. The Sardar Sarovar Project is built on the Narmada River, one of the major rivers of peninsular India with a length of around 1,312 kilometres (815 mi). It is one of only three rivers in peninsular India that run from east to west – the others being the Tapi River and the Mahi River. A riverfront project has been built on the Sabarmati River.

Demographics:

The population of Gujarat State was 60,383,628 according to the 2011 census data. The population density is 308 km−2 (797.6/sq mi), lower than other Indian states. As per the census of 2011, the state has a sex ratio of 918 girls for every 1000 boys, one of the lowest (ranked 24) amongst the 29 states in India.

While Gujarati speakers constitute a majority of Gujarat's population, there exists a cosmopolitan atmosphere especially in the metropolitan areas of Ahmedabad and Surat. Marwaris and Biharis compose large minorities of economic migrants while smaller communities to be found are Nepalese, Portuguese, South Koreans, Tamils, Odias, Telugus, Assamese, Bengali, Anglo- Indians, Armenians, Greeks, Jews, Tibetans, Maharashtrians, Konkanis, Malayalees, Punjabis, and Parsis. The South Korean community traditionally worked in the local tanning industry and ran restaurants. Sindhi presence is traditionally important here following the loss of their province post-Partition.

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Religion:

Gujarat consists of people following Hinduism, Islam, Judaism, Jainism, Buddhism, Christianity and Zoroastrianism, making it a religiously diverse state. Hinduism is major religion of the state, as 88.6% population of the state is Hindu. A major part of the Hindu population follow Vaishnavism. Muslims are the biggest minority in the state accounting for 9.7% of the population. Gujarat has the third-largest population of Jains in India, following Maharashtra and Rajasthan.

Language:

Gujarati is an Indo-Aryan language evolved from Sanskrit and local Prakrits, and is part of the greater Indo-European language family. It is native to the Indian state of Gujarat, and is its main language, as well as of the adjacent union territories of Daman and Diu and Dadra and Nagar Haveli.

About 59 million people speak Gujarati, making it the 26th most-spoken native language in the world. Along with Romani, Kutchi and Sindhi, it is amongst the most western of Indo-Aryan languages.

The majority of the population in the state can speak Gujarati and Hindi, whilst people from the Kutch region of Gujarat also speak in the Kutchi mother tongue, and to a great extent appreciate Sindhi as well. Memoni is the mother tongue of Kathiawar and Sindhi Memons, most of them who are exclusively Muslims.

Almost 88% of the Gujarati Muslims speak Gujarati as their mother tongue, whilst the other 12% speak Urdu. A sizeable proportion of Gujarati Muslims are bilingual in both languages as Islamic academic institutions (Darul Uloom) place a high prestige on learning Urdu and Arabic, memorising the Quran and ahadith, and emphasising the oral and literary importance of mastering these rich languages as a compulsory rite of religion. Other native languages spoken in low proportions are Bhili and Gamit, which are spoken exclusively among the tribals.

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Government:

Gujarat is governed by a Legislative Assembly of 182 members. Members of the Legislative Assembly are elected on the basis of adult suffrage from one of 182 constituencies, of which 13 are reserved for scheduled castes and 27 for scheduled tribes. The term of office for a member of the Legislative Assembly is five years. The Legislative Assembly elects a speaker who presides over the meetings of the legislature. A governor is appointed by the President of India, and is to address the state legislature after every general election and the commencement of each year's first session of the Legislative Assembly. The leader of the majority party or coalition in the legislature (Chief Minister) or his or her designee acts as the Leader of the Legislative Assembly. The administration of the state is led by the Chief Minister. The current Chief Minister of the state is Anandiben Patel, who recently took office after Narendra Modi was elected as Prime Minister of India.

Economy:

Gujarat has some of the largest business corporations in India. It is one of the major industrial hubs of India. During the British Raj, Gujarati businesses served to play a major role to enrich the economy of Karachi and Mumbai. Major agricultural produce of the state includes cotton, groundnuts (peanuts), dates, sugar cane, milk and milk products. Industrial products include cement and petrol. According to a 2009 report on economic freedom by the Cato Institute, Gujarat is the second freest state in India (the first one being Tamil Nadu). Reliance Industries operates the oil refinery at Jamnagar, which are the world‘s largest grass-roots refineries. The world's largest shipbreaking yard is in Gujarat near Bhavnagar at Alang. India‘s only Liquid Chemical Port Terminal at Dahej, developed by Gujarat Chemical Port Terminal Co Ltd. Gujarat has two of the three liquefied natural gas (LNG) terminals in the country (Dahej and Hazira). Two more LNG terminals are proposed, at Pipavav and Mundra.

Education:

The Gujarat Secondary and Higher Secondary Education Board (GSHSEB) are in charge of the schools run by the Government of Gujarat. However, most of the private schools in Gujarat are affiliated to the Central Board of Secondary Education (CBSE) and Council for the Indian

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School Certificate Examinations (CISCE) board. Gujarat has 13 state universities and four agricultural universities. The premier management institute Indian Institute of Management in Ahmedabad ranks the best in India and among the best management Universities in the world.

The top-notch institutes for Engineering and Research include IIT Gandhinagar Dhirubhai Ambani Institute of Information and Communication Technology (DA-IICT) also in Gandhinagar, Sardar Vallabhbhai National Institute of Technology (SVNIT) in Surat, Pandit Deendayal Petroleum University (PDPU) in Gandhinagar, Nirma University in Ahmedabad and Charotar University of Science and Technology (CHARUSAT) in Changa (a village in anand district). Mudra Institute of Communications Ahmedabad (MICA) is one of the most famous institutes for mass communication and is well-renowned across India.

In addition, Institute of Rural Management Anand (IRMA) is one of the leading sectoral institutions in rural management. IRMA is a unique institution in the sense that it provides professional education to train managers for rural management. It is the only one of its kind in all Asia.The National Institute of Design (NID) in Ahmedabad and Gandhinagar is internationally acclaimed as one of the foremost multi-disciplinary institutions in the field of design education and research. Centre for Environmental Planning & Technology University, popularly known as (CEPT) is one of the best planning and architectural school not in India, but across the world; providing various technical and professional courses.

Overview of the automobile industry in Gujarat

 Tata motors  Automobile industry is

 General Motors contributing about 7% in total GDP of India.  Ford motors

 Asia motor works  India’s total GDP is 2066.90 billion USD.

 It represents 3.33% in

world’s GDP.

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Overview of Automobile Industry in India

The automotive industry in India is one of the largest automotive markets in the world. It was previously one of the fastest growing markets globally, but it is currently experiencing flat or negative growth rates. In 2009, India emerged as Asia's fourth largest exporter of passenger cars, behind Japan, South Korea, and Thailand, overtaking Thailand to become third in 2010. As of 2010, India was home to 40 million passenger vehicles. More than 3.7 million automotive vehicles were produced in India in 2010 (an increase of 33.9%), making India the second fastest growing automobile market in the world (after China). India's passenger car and commercial vehicle manufacturing industry recently overtook Brazil to become the sixth largest in the world, with an annual production of more than 3.9 million units in 2011. From 2011 to 2012, the industry grew 16-18%, selling around three million units. According to the Society of Indian Automobile Manufacturers, annual vehicle sales are projected to increase to 4 million by 2015, not 5 million as previously projected.

Introduction

The Indian auto industry is one of the largest in the world with an annual production of 23.37 million vehicles in FY 2014-15, following a growth of 8.68 per cent over the last year.

The automobile industry accounts for 7.1 per cent of the country's gross domestic product (GDP). The Two Wheelers segment with 81 per cent market share is the leader of the Indian Automobile market owing to a growing middle class and a young population. Moreover, the growing interest of the companies in exploring the rural markets further aided the growth of the sector. The overall Passenger Vehicle segment has 13 per cent market share.

India is also a prominent auto exporter and has strong export growth expectations for the near future. In FY 2014-15, automobile exports grew by 15 per cent over the last year. In addition, several initiatives by the Government of India and the major automobile players in the Indian market are expected to make India a leader in the Two Wheeler and Four Wheeler market in the world by 2020.

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Contribution to GDP:

The Role of Automobile Industry in India GDP has been phenomenon. The Automobile Industry is one of the fastest growing sectors in India. The increase in the demand for cars, and other vehicles, powered by the increase in the income is the primary growth driver of the automobile industry in India. The introduction of tailor made finance schemes, easy repayment schemes has also helped the growth of the automobile sector.

“To emerge as the destination of choice in the world for design and manufacturing of automobiles and auto components with output reaching a level of US $ 145 billion, accounting for more than 10 per cent of the GDP and providing additional employment to 25 million people by 2016.‖ This is the vision of the Automotive Mission Plan 2006 - 2016 drafted by the Ministry of Heavy Industries and Public Enterprises department of the Government of India.

This gives you an idea to the magnitude of a single industry being able to contribute as much as 10 per cent of the gross domestic product for a country like India. As of 2013, the Indian automobile industry had contributed to almost 7 per cent of the country‘s GDP. During the time it provided 22 per cent of India‘s manufacturing GDP and provided around 18 per cent of excise duties to the state exchequer. The Indian automobile industry has also significantly increased the

39 | P a g e presence of the nation in international markets with a year-on-year increase in exports of approximately 18 per cent.

With a significant number of car makers already present in India and more of them looking to enter the market in the future, the potential of the Indian automobile industry is immense in terms of both revenue generation and employment. While the industry has gone through a slowdown off late, what car makers are now looking forward to are reduction in duties and taxes along with the incorporation of a centralized Goods and Service tax norm that will not only streamline tax norms to make life easier for companies but also boost the industry as a whole.

MAJOR PLAYERS IN AUTOMOBILE INDUSTRY IN INDIA:

Maruti Suzuki (37% Market Share): Maruti Suzuki India Limited (MSIL, formerly Maruti Udyog Limited) is a subsidiary of Suzuki Motor Corporation of Japan. Maruti Suzuki is a leading manufacturer of passenger vehicles in India. Lovingly referred to as the people‘s car maker; over the past three decades Maruti Suzuki has changed the way people in India commute and travel.

Hyundai Motors India Limited (14.4% Market Share): Hyundai Motor India Limited (HMIL) is a wholly owned subsidiary of Hyundai Motor Company (HMC). HMIL is the largest passenger car exporter and the second largest car manufacturer in India. It currently markets eight passenger car models across segments — in the A2 segment it has the Eon, Santro, i10 and the i20, in the A3 segment the Accent and the Verna, in the A5 segment Sonata and in the SUV segment the Santa Fe.

Tata Motors (13.1% Market Share): Tata Motors Limited is India‘s largest automobile company, with consolidated revenues of INR 1, 65,654 crores (USD 32.5 billion) in 2011-12. It is the leader in commercial vehicles in each segment, and among the top three in passenger vehicles with winning products in the compact, midsize car and utility vehicle segments. It is the world‘s fourth largest truck and bus manufacturer.

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Mahindra & Mahindra (11.4% Market Share): In 1947, Mahindra & Mahindra introduced India to the utility vehicle. More than 65 years later, it is still India‘s premier utility vehicle (UV) company. In addition to making ground-breaking UVs like the Scorpio and Bolero, Mahindra offers cars, pickups, and commercial vehicles that are rugged, reliable, environmentally friendly, and fuel-efficient.

Toyota (6.4% Market Share): Since its inception in India in 1997, Toyota Kirloskar Motor has witnessed a steady growth in the Indian automotive market and is today more than ready to seize the enormous opportunity India offers. Toyota‘s newly built second plant is a testimony to this commitment and also, the start of a new era for Toyota in India.

General Motors (3.3% Market Share): General Motors India Private Limited is a 50:50 partnership between General Motors and SAIC that is engaged in the automobile business in India. It is the 6th largest automobile manufacturing company in India. General Motors India started its journey in 1996 and has completed 16 years of operation in India.

Ford (3.2% Market Share): Established in 1995, Ford India is a wholly owned subsidiary of Ford Motor Company, a global automotive industry leader. Ford India manufactures and distributes automobiles and engines made at its modern integrated manufacturing facilities at Maraimalai Nagar, near Chennai. The company‘s models include the Endeavour, Fiesta and the Figo.

Honda (2.9% Market Share): Honda Cars India Ltd., (HCIL) is a leading manufacturer of premium cars in India. The company was established in 1995 with a commitment to provide Honda‘s latest passenger car models and technologies, to the Indian customers. The company is a subsidiary of Honda Motor Co. Ltd., Japan.

Volkswagen (2.4% Market Share): With its headquarters in Pune, Maharashtra (India), the Volkswagen Group is represented by three brands in India: Volkswagen, Audi and Skoda. The Volkswagen Group is completing 10 years of its India journey which began with the entry of the Skoda brand in 2001, Audi brand and Volkswagen brand in 2007. Each brand has its own character and operates as an independent entity in the market. Nissan (1.5% Market Share): Nissan Motor India Private Ltd. (NMIPL), a 100% subsidiary of

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Nissan Motor Co., Ltd., was incorporated in 2005 with a vision of ‗Enriching People‘s Lives‘ through latest Nissan Technology and products. In India, Nissan offers innovative and exciting products across hatchback, sports, and SUV and sedan segments. Nissan has successful introduced two locally-produced models in India in less than two years – Micra & Sunny.

LOCAL TAXES & DUTIES ON AUTOMOBILE SECTOR:

Most demands raised by auto players were not addressed in the current budget. That said, reduced corporate tax (from 30% to 25%) and the government's focus on infrastructure will indirectly help the auto industry.

Lower excise duty benefit was the primary demand that all the automakers were asking, which in the new budget has not been addressed. This means that cars and two-wheelers will not get cheaper. The previous UPA government had cut excise duty on cars, SUVs and two-wheelers in its interim budget in February 2014 to help the industry tide over a demand slump.

Excise duty was reduced to 24 per cent from 30 per cent in the case of SUVs, 20 per cent for mid-sized car from 24 per cent and 24 per cent for large cars from 27 per cent. In June, the new government led by Narendra Modi extended the excise duty concession by six months to December 31. But in January, it was rolled back and the excise duty slab came to the old structure once again.

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SPECIAL BENEFITS PROVIDED BY THE STATE OF GOVERNMENT:

We have announced a policy of mega and innovative projects under which incentives are offered to select sectors. Accordingly, the automobile sector comes under this and is eligible for incentives under the scheme of Mega Projects. Industries are required to fulfil the condition of investing in fixed assets exceeding Rs 1,000 Crores and providing jobs to 2,000 people. The eligible industries get benefits of sales tax incentives for 10 years.

The plants of General Motors India and Tata Motors are in operation at Halol and Sanand respectively. Understanding the potential to attract more investment in this region, the Gujarat Industrial Development Corporation (GIDC) has undertaken expansion activities of the Halol Estate and set up an estate at Sanand.

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1. Raw Material Availability: Raw material should be easily available near to a selected location, as it will reduce the cost of transporting raw materials. Mundra Port would allow them to import steel and other raw materials at very low cost even from overseas. Transporting the same over land would cost thrice as much2) 2. Nearness to Markets: It will reduce the cost of transporting the finished goods to the market but also decrease the chances of finished product being damaged or spoiled in the way. Moreover a plant being near to the market can catch a big share of the market and can also provide quick service to the customers. Setting up the Nano plant in Gujarat is advantageous for the group because nearly 50 % of the car parts are produced in Rajkot, and the extensive coastline of the state could be beneficial for imports and exports. And proximity of mudra port will allow them to export cars to the markets easily.

3. Transportation Cost and Facilities: A lot of many are spent both in transporting raw materials and finished goods, therefore it should also be kept in mind that the transportation cost should be fairly minimum and also be available easily. The strategic location of Sanand, some 30 km from Ahmedabad and its proximity to the Ahmedabad-Rajkot highway made the new site attractive In some state local government provide various facilities (i.e. Provide loans, feed money in business, machinery, relaxation in tax policy, excise duties, etc.) to attract industrialists. It is also important to have knowledge about government regulations and if are available should be made use of the facilities. Gujarat government has provided land at low rate.

4. Income Tax Incentives:

10 year corporate tax holiday on export profit 100% for initial 5 years and 50% Indirect Tax Incentives Zero customs duty Zero excise duty

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CHAPTER- 4

Justification for the selected

industry

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JUSTIFICATION FOR SELECTING THE INDUSTRY/SECTOR:

We have selected this industry because there is lots of opportunity in Cambodia for automobile Sector in Cambodia. There are total 2000 car demand annually in Cambodia and which is increasing day by day. If we talk about Gujarat than Gujarat is slowly becoming the automobile hub In India because there are many companies in Gujarat who are producing their cars in Gujarat; Like Ford, TATA, General Motors, CEAT Tyres and Maruti Suzuki is coming in 2016. So there is lot of opportunity for bilateral trade opportunity with Cambodia with focused to Automobile sector because there is lot of scope in Cambodia for automobile industry and most of the companies in Cambodia are exporting to Cambodia but they have not yet started manufacturing in Cambodia and now the political stability will help in manufacturing cars in Cambodia.

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CHAPTER- 5 STEEPLED Analysis of

Cambodia & Gujarat

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STEEPLED OF GUJARAT:

Social Analysis of Gujarat

Life style:

Since changed lifestyle of people, leads to increased purchase of automobiles, so automobile sector is having a more numbers of customers.

Social life:

Social life of the people of Gujarat also impacts on buying behaviour of automobile. Customer of Gujarat is price sensitive means they bargain for every product they want to buy.The greater a person's age, the greater the level of respect that must be granted to them.

People of Gujarat are accepting small & compact cars because of traffic. Growth in urbanization is there in Gujarat.

Preference for fuel efficient car with low running cost.Gujarat customers are price sensitive and put a lot on emphasis on value of money.

Education:

Gujarat customers are highly aware, well-educated and informed. They are price sensitive and put a lot of emphasis on value of money.

Labour and Social Mobility:

Here in this sector the work of labour is very important because each equipment of the cars should be fixed in a proper way.

Technical (Gujarat):

R & D activities:

Companies in Gujarat is mainly focusing on R & D activities The Government is promoting National Automotive Testing and R&D Infrastructure Project (NATRIP) to support the growth of the auto industry.

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Internet:

Technology is helping in the solution to integrate supply chain and because of that it reduces losses and increases the profit. The connectivity to the world through internet is very good in Gujarat because 4G is in Gujarat launched by Airtel.

Companies:

Major global players like Ford; General motors etc. have setup their manufacturing units in Gujarat. Global companies entered into the market with full of technology in production as well as in product also. Tata and parent company are no. 1 in technology field.

Employing 1,400 scientists and engineers, Tata Motors‟ Research and Development team is ahead. Automobile industry is becoming crucial for manufacturer to stay on top with rising of new problems such as pollution problems. Internet connectivity is very strong in Gujarat so technology usage is very easy for companies of auto mobile industry in Gujarat.

Alternate Fuels:

Because of alternate fuels are available in the market, hybrid cars are now entering into the market.

Economic factors (Gujarat)

Economic growth

The current economic growth of Gujarat in terms of GDP is about 8.5% which is good sign for any industry especially automobile and also industry friendly environment of Gujarat is suitable for automobile industry.

Government spending

The government of Gujarat develop public private partnership model which support to develop industries and infrastructure facility which is suitable to develop automobile industry at Gujarat.

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Under this public private partnership model government spending is 50% and till now out of total investment government spend 125.03 billion dollar (percentage value 12.91).

Employment and unemployment

Availability of all level employees is high due to environment and literacy level in a state. Population of Gujarat is most of working population between the age group of 18-60 which is suitable for any industry. Automobile industry at Gujarat consider under mega projects which have to provide employment to minimum 2000 people and due to this unemployment rate at Gujarat is 1%. Also government of Gujarat develop more than 150 skill development centre which provides skill labour to automobile industry.

Interest rates and monetary policy

In Gujarat interest rates and monetary policy is liberal to provide a platform to develop more industry. The small and medium sectors at Gujarat get 7% interest subsidiary for five years while large scale industry get benefit of 2% interest subsidiary for five years from the day of commencement which if positive sign for automobile industry.

Taxation

Taxation policy for automobile industry at Gujarat is very liberal and industry friendly. If the automobile industry fulfill the requirement of mega projects regarding investment and providing employment than its get benefit of sales tax incentives for 10 year also with 100% tax benefit in export in corporate tax and zero custom and excise duty which makes Gujarat as a lucrative state for automobile industry.

Inflation and exchange rates

Inflation rate at Gujarat is about to 7.5% which is slightly worried factor for automobile industry. Due to change in exchange rates and inflation rate, every time change in price of fuel and other raw materials destruct the calculation of demand and growth for automobile industry.

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Environmental factor (Gujarat)

Natural resources:

Gujarat has very wide range of natural resources are available in terms of raw materials and minerals etc. with human resource. Gujarat has its own resources to generate power and electricity and water and land facilities are vast available which is most suitable to automobile industry.

Infrastructure

Infrastructure wise Gujarat is more developed than any other state. Gujarat industrial development corporation (GIDC) develop special economic zone (SEZ) in Gujarat at halol and sanand especially for automobile industry which is fully developed with power, infrastructure, water and human resource which motivates any industrial start up. The Gujarat government planning to spend 116,993 crore rs.to develop various facilities like port, power, roads, industrial park, township, urban transportation and water supply & sanitation which makes Gujarat as a lucrative for automobile industry.

Political (Gujarat):

Government support:

Gujarat govt. has changed role to facilitator with focus on providing best infrastructure, growth oriented economy and correct environment to attract investments. This has made giant auto manufacturers enter into Gujarat. The steps that government has taken in relaxation of foreign exchange, equity regulations have played important role in bringing Gujarat automobile industry at very good level. Gujarat is the only state to emerge as investor friendly state in India. Establish an international hub for manufacturing small, affordable passenger cars as well as tractor and two wheelers. Indian government auto policy aimed at promoting an integrated, phased and conductive growth of the Indian automobile industry.

Summit:

The vibrant summit has opened up the doors for automobile industries for Gujarat. With low cost, good amount of water supply, low risk & safety. The support of proactive government is

51 | P a g e key factor for rapid automobile sector growth. The Gujarat government has taken several policies measures and incentives to attract large amount of investors.

Political stability:

Political stability is most important for any sector to grow in a particular region which is there in Gujarat for the last 15 years. The plants of General Motors India and Tata motors are in operation at Halol and sanand. The Gujarat Industrial Development Corporation (GIDC) has undertaken the expansion activities of the Halol Estate at Sanand. Both estates are having full facilities with road, power, water and gas facilities.

Infrastructure:

When Tata Motors decided to set up its plant in Gujarat, they were concerned for the skilled labour. The government of Gujarat has announced a policy of skill development under which industries will have courses and they will be allowed to utilise ITI buildings to conduct skill programmes.

State government departments through the platform of the Vibrant Gujarat Summit organised the interval of two years. We invite Indian states as partner states at Vibrant Gujarat Summits wherein they are provided a platform to give presentations. The key highlight is the incentives the state offers. The important factor to attract investors is to be ready infrastructural facilities. The state government is committed to providing investors with a comfort level.

Legal (Gujarat):

Ministry of shipping & transport:

In Gujarat, regulations regarding automobile industry are governed by ministry of shipping, road transport & highways. Motor vehicles act, 1988 is the main act which monitors the emission norms in Gujarat.

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Government regulations:

Gujarat safety standards are hand on hand with international standards. The legal frame work for automobile sector is so easy and friendly that because of low cost, low land cost and by providing end no. of facilities, Gujarat is an automobile hub, because tata nano plant at sanand & ceat tyres plant at Halol are the examples for it.

Auto policy of government of Gujarat is aiming to promote an integrated and conductive growth of the automobile industry of Gujarat. Government of Gujarat wants to make Gujarat as international hub for manufacturing small, affordable passenger cars, as well as tractor and two wheelers.

Ethical (Gujarat):

People of Gujarat:

Bribery is there in Gujarat in all Sectors so which is not good for the industry. People of Gujarat prefer to buy new cars but they give extra money as a bribe to get immediate delivery. Because of vibrant Gujarat summit, reputation of Gujarat government is very friendly.

Demographics (Gujarat):

Name:

Gujarat was earlier known as Saurastra and it was a part of state Mumbai which include Maharashtra and Gujarat both. On 1st may, 1960 Mumbai was divided in two parts and State of Gujarat was made.

Geographical Location:

Gujarat borders Pakistan's Sindh province to the northwest, is bounded by the Arabian Sea to the southwest, the state of Rajasthan to the northeast, Madhya Pradesh to the east, and by Maharashtra, Union territories of Diu, Daman, Dadra and Nagar Haveli to the south. Historically,

53 | P a g e the north was known as Anarta, the Kathiawar peninsula, "Saurastra", and the south as "Lata". The Arabian Sea makes up the state's western coast. The capital, Gandhinagar is a planned city. Gujarat has an area of 75,686 sq mi (196,030 km2) with the longest coast line (24% of Indian sea coast) 1,600 kilometres (990 mi), dotted with 41 ports: one major, 11 intermediate and 29 minor.

Language:

Gujarati is an Indo-Aryan language evolved from Sanskrit and local Prakrits, and is part of the greater Indo-European language family. It is native to the Indian state of Gujarat, and is its main language, as well as of the adjacent union territories of Daman and Diu and Dadra and Nagar Haveli. About 59 million people speak Gujarati, making it the 26th most-spoken native language in the world. Along with Romani, Kutchi and Sindhi, it is amongst the most western of Indo- Aryan languages. The majority of the population in the state can speak Gujarati and Hindi, whilst people from the Kutch region of Gujarat also speak in the Kutchi mother tongue, and to a great extent appreciate Sindhi as well. Memoni is the mother tongue of Kathiawar and Sindhi Memons, most of them who are exclusively Muslims. Almost 88% of the Gujarati Muslims speak Gujarati as their mother tongue, whilst the other 12% speak Urdu.

Population:

The population of Gujarat State was 60,383,628 according to the 2011 census data. The population density is 308 km−2 (797.6/sq. mi), lower than other Indian states. As per the census

54 | P a g e of 2011, the state has a sex ratio of 918 girls for every 1000 boys, one of the lowest (ranked 24) amongst the 29 states in India.

STEEPLED OF CAMBODIA

Social Analysis of Cambodia

Life Style changes:

Family is still the most important social reference unit as young people have really good relationship with their parents.

Social life:

Family is the most important for young people. Cambodians people are known for their kindness, patience and talent as well as having a wealthy culture and tradition. The greater a person's age, the greater the level of respect that must be granted to them.

Labour and social mobility:

As the automobile sector is growing in the Cambodia country so highly skilled workers are required.

Education:

Lifestyle of the people gets changed as with the new industry coming to the country there is increased in employment of the country.

Technical (Cambodia):

R & D activities:

Country is importing the new cars, no any company is having there manufacturing plant in Cambodia, Government is not promoting that R & D activities. Cambodia is one of the fastest

55 | P a g e growing countries; technology is already benefitting the nation. One out of every six businesses launched were part of the information and communications technology (ICT) industry. Today, the number of mobile subscriptions in Cambodia exceeds the population.

Internet:

Today, the number of mobile subscriptions in Cambodia exceeds the population. Internet usage increased by almost 60 percent, jumping from 1.7 million users to 27 lacs users. Increment in use of mobile and Internet users in Cambodia means there is limitless potential for business growth and employment opportunities in the technology sector.

New Companies:

New companies are entering into the Cambodian automobile market and they are bringing new technologies. New industry comes up with new technology for their company to lead in market.

Alternate fuels:

Increasing use of other fuels like CNG and LPG fuel has made the entry of new kinds of vehicle in the market. Electric cars are introduced in the automobile industry in Cambodia.

Economic factor (Cambodia)

Basically economy of Cambodia is mainly based on the other, which means that economy of Cambodia is a dependent economy. Main economic activities are based on foreign institutional investment and foreign market.

Economic growth

According to World Bank Cambodia‘s economic growth rate will expected to be 6.9% which shows a positive sign about the development of any industry. While the sector wise GDP are agriculture 34.8%, industry 24.5%, and service 40.7% which is also a positive side for any automobile industry.

Government spending:

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In Cambodia government spending is 50% with the support of other organisation like IMF, World Bank, Asian development bank for any industry‘s growth and development in open development programme, which is suitable for automobile industry at Cambodia.

Employment & unemployment:

Cambodia‘s population is raised by 1.5% every year which increase the labour force in the country. On the other hand the condition of Cambodia is such that it is fail to generate productive employment. So, it is opportunity for any automobile manufacturing company to get labour at cheaper rate but at the same time labours are uneducated and unskilled which is unsuitable for any industry.

Inflation and exchange rate

Cambodia‘s macroeconomic policy is helpful to reduce inflation because of its conservative fiscal policy. Exchange rates are free in Cambodia and there is no restriction on current and capital account. So, the economy of Cambodia is liberalised and it is suitable factor for automobile industry.

Interest rates & monetary policy

As stated earlier that the economy of Cambodia is liberalised, the national bank of Cambodia does not have any direct control over interest rates. Banks are free to charge interest rates and lending to any organisation and industry. The monetary authority use foreign exchange intervention to maintain the liquidity and exchange rates.

Taxation

The import excise tax on new car at Cambodia is 45% which hinder the new players at there and restrict the growth of industry as grey and black markets emerge due to this.

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Environmental factors (Cambodia)

Natural resources:

Natural resources are widely available at Cambodia. Only 20% of land was used for the industrialization and urbanisation while other resources like availability of water and chip labour are advantageous for automobile industry. The main problem regarding natural resources is energy. Cambodia doesn‘t have its own source of energy. They import energy from neighbours like Vietnam and Thailand. Only 22% of Cambodia use electricity which might hinders the growth of automobile industry.

Infrastructure:

Infrastructure is more concentrated towards main cities. Development of roads and transportation in last few years are quite well but due to lack of care affects it very badly. The main advantage for automobile industry is too exclusive and special economic zone which is 62515 sq. kms, also marine and coastal zone is wide range which is beneficial for industry.

Climate change and threat from natural causes

Climate change is in terms of heavy fluctuation in rainy season and monsoon. Due to this temperature of county is not stable and floods and droughts situations was occurred which is not suitable for some industry.

Global warming

Due to global warming the sea level of Cambodia is rises and which leads to problems like coastal erosion and it affects the economically important ports and coastal zones and it also be bring situation like floods and storms which is not ideal situation for automobile industry and export as well.

Sustainable energy

Though the energy sources for industry is limited in Cambodia the government focuses on various sustainable energy plans like hydro-electricity, solar energy etc. to reduce the gap, also

58 | P a g e they develop a plan to use bio mass, forest waste, animal waste as a source of energy for villagers which helps to develop industry indirectly.

Political of Cambodia:

Political Stability:

Most important factor in automobile industry is political stability in Cambodia. Stability of politics, safety ensured the of transportation development, infrastructure. Economy of Cambodia is open to FDI with 100% foreign investment, while some of the sectors are having the restrictions of local equity participation, this includes These include manufacturing of cigarettes, movie production, rice milling, publishing and printing, radio and television, manufacturing of wood and stone carvings, and silk weaving. Thanks to political stability, Cambodians are investing in more stable and long-term businesses, which is a good thing for country‘s economy. With a stable country and tremendous economic growth, Cambodia is having a healthy number of ultra- high net worth consumers. Corruption:

This is one of the most important problems ruining the economy. According to the Index of Corruption 2014 by Transparency International, Cambodia is ranked at 157 from 176 countries, in corruption.

Infrastructure:

Infrastructure insufficiency is the big problem ruining the country‘s competitiveness and growth. Addition to political; the Cambodian government has been accused of corruption in the sale of large area of land to investors which is resulted to exploit country‘s oil and mineral resources. Cambodia is consistently listed as one of the most corrupt governments.

Government support:

Government is not providing any support to the automobile industry as it is imposing taxes on car imports contribute to a third of the government‘s tax collections and that government wants

59 | P a g e more taxes so that they can pay their staff better. The tax scheme for Cambodia‘s car imports always favours second hand cars.

Automobile Market:

Cambodia is having small auto market with annual new car demands about 2,000 units and used cars demand up to 20,000 units. Now, the country is hoping that global automakers from neighbouring Thailand and Vietnam with a young, cheap labour force, especially.

The situation of Cambodian auto sector is ―grey‖. Due to high taxes on import, with 45% excise charged when new car is brought into Cambodia. It is not surprise that people are going towards a grey market. When the car is imported other than official channel, it will be cheaper. While authorized dealers are spending millions on it. It is not easy for them to crack the market monopoly of unofficial import cars in which sale price is almost 50% cheaper. The authorized dealership is increasing in numbers but they are not sure that they can overtake the grey market in near future.

Legal (Cambodia):

Ministry of environment:

The responsibility regarding the quantity of flammable substances, air pollutions & noise created by the vehicles either it is a two, three, four vehicles lies with the ministry of environment with the collaboration of other ministries. Ministry of environment has the responsibility to frame guidelines regarding the same. The responsible person for the air pollution has to bear expenses for the analysis done by the ministry of environment. Ministry of environment has the responsibility to check the air quality on a regular basis.

Law: The said law governs any investments carried out in the territory of the Kingdom of Cambodia by Cambodian and/or foreign investors. Cambodia‘s judicial system does not provide any commercial courts. Cambodia‘s commercial regulatory environment presents a number of challenges like corruption, policy uncertainty. Ministry of commerce of Cambodia makes a

60 | P a g e watch on foreign and domestic business activities; it takes a lead developing commercial legislation and issues the certificate for the same.

Government regulations:

Cambodian government has made compulsory for the automobile sector to test the ignition of the car to prevent it from fire. If there is any electrical car in the market than company has to make sure that there is no any problem in the battery so that it can save people from physical damage. Combodian government has made compulsory for all the companies that they have to mention all the facts related to their product in the advertisement. It should match all the safety standard of the government. For the safety purpose, department of Cambodia has announced that the imported vehicles should not be more than 2 years old.

Ethical (Cambodia): People of Cambodia:

People of Cambodia buy cars from grey market, the market in which cars are dealt without original invoices which is cheaper than the new cars. The Cambodian people have more trust on second hand car and because of this Cambodia has annual demand of 20000 second hand cars. Automobile industry has to provide cars with low pollutant. Automobile industry are earning a good amount of profit so they should have an ethics to give some part of their profit back to the people of Cambodia in terms of corporate social responsibility. If the customers are having any problem than it is resolved in timely manner.

Demographics (Cambodia): Name: The official name of the country is the empire of Cambodia and in Khmer as (Preah Reacheanachak Kampuchea), often shortened to Kampuchea. Kampuchea derives from the Sanskrit word Kambuja or "Golden Land" or "Land of Peace and Prosperity", as described by the Khmer Buddhist friar Chuon Nath in his Khmer Dictionary.

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Geographic Location: Cambodia has a land area of 181,035 square Km in the south-western part of the Indochina peninsula, about 20% of which is used for agriculture. It lies fully within the tropics with its southern most points narrowly more than 10° above the Equator. The country capital city is Phnom Penh.

Language of Cambodia:

The Cambodian language is Khmer, which is hereditary itself - and advanced in education with application of Indic languages Pali and Sanskrit from India. Also, the Khmer language is influenced by spoken and written Thai.

Population:

As of 2013, Cambodia has an estimated population of 15,205,539 people. Cambodia's birth rate is 25.4 per 1,000. Its population growth rate is 1.7%.

COMPARISION BETWEEN CAMBODIA AND GUJARAT:

Social Cambodia Gujarat Life style Families are more important Due to change in life style, than luxury for them. leads to increased purchase of automobiles. Social Life They respect there elder, Social life affects in people are known for purchasing buyers behaviour kindness and talent. Labour and social mobility Highly skilled labour are Here in this sector the work required of labour is very important because each equipment of the cars should be fixed in a

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proper way.

Technical Cambodia Gujarat R & D Government is not promoting The Government is those R & D activities. promoting National Automotive Testing and R&D Infrastructure Project (NATRIP) to support the growth of the auto industry.

Internet Internet usage increased by The connectivity to the world almost 60 percent, jumping through internet is very good from 1.7 million users to 27 in Gujarat because 4G is in lacs users. Gujarat launched by Airtel.

New Companies New companies are entering Major global players like into the Cambodian Ford; General motors etc. automobile market and they have setup their are bringing new manufacturing units in technologies. Gujarat. Alternate fuels Electric cars are introduced Because of alternate fuels are in the automobile industry in available in the market, Cambodia. hybrid cars are now entering into the market.

Economic factors Cambodia Gujarat Economic growth According to World Bank The current economic growth

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Cambodia‘s economic of Gujarat in terms of GDP is growth rate will expected to about 8.5% be 6.9% which shows a positive sign about the development of any industry. Government spending In Cambodia government Under this public private spending is 50% with the partnership model support of other organisation government spending is 50% like IMF, World Bank, Asian and till now out of total development bank investment government spend 125.03 billion dollar. Employment and Condition of Cambodia is Availability of all level unemployment such that it is fail to generate employees is high due to productive employment. environment and literacy level in a state. Interest rates and monetary The economy of Cambodia is In Gujarat interest rates and policy liberalised, the national bank monetary policy is liberal to of Cambodia does not have provide a platform to develop any direct control over more industry. interest rates. Taxation The import excise tax on new Taxation policy for car at Cambodia is 45% automobile industry at which hinder the new players Gujarat is very liberal and industry friendly. Inflation and exchange Cambodia‘s macroeconomic Inflation rate at Gujarat is rates policy is helpful to reduce about to 7.5% which is inflation because of its slightly worried factor for conservative fiscal policy. automobile industry.

Environmental Cambodia Gujarat

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Natural resources Only 20% of land was used Gujarat has its own resources for the industrialization and to generate power and urbanisation while other electricity and water and land resources like availability of facilities are vast available water and chip labour are which is most suitable to advantageous for automobile automobile industry. industry. Infrastructure Infrastructure is more Gujarat industrial concentrated towards main development corporation cities. Development of roads (GIDC) develop special and transportation in last few economic zone (SEZ) in years are quite well but due Gujarat at halol and sanand to lack of care affects it very badly.

Political Cambodia Gujarat Political Stability Thanks to political stability, Political stability is most Cambodians are investing in important for any sector to more stable and long-term grow in a particular region businesses&Economy of which is there in Gujarat for Cambodia is open to FDI the last 15 years. with 100% foreign investment. Infrastructure Infrastructure insufficiency is The government of Gujarat the big problem ruining the has announced a policy of

country‘s competitiveness skill development under and growth. which industries will have courses and they will be allowed to utilise ITI buildings to conduct skill

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programmes. Government support Government is not providing Gujarat govt. has changed any support to the role to facilitator with focus automobile industry as it is on providing best imposing taxes on car infrastructure, growth imports contribute to a third oriented economy and correct of the government‘s tax environment to attract collections. investments.

Legal Cambodia Gujarat Ministry of environment Ministry of environment has In Gujarat, regulations the responsibility to frame regarding automobile guidelines regarding the industry are governed by same. ministry of shipping, road transport & highways. Government regulations Cambodian government has Auto policy of government made compulsory for the of Gujarat is aiming to automobile sector to test the promote an integrated and ignition of the car to prevent conductive growth of the it from fire. automobile industry of Gujarat

Ethical Cambodia Gujarat People of Cambodia People of Cambodia buy cars People of Gujarat prefer to from grey market, the market buy new cars but they give in which cars are dealt extra money as a bribe to get without original invoices immediate delivery. which is cheaper than the new cars.

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Demographics Cambodia Gujarat Name The official name of the Gujarat was earlier known as country is the empire of Saurastra and it was a part of Cambodia and in Khmer as state Mumbai which include (Preah Reacheanachak Maharashtra and Gujarat both. Kampuchea) Geographical location Cambodia has a land area of Gujarat borders Pakistan's 181,035 square Km in the Sindh province to the south-western part of the northwest, is bounded by the Indochina peninsula, about Arabian Sea to the southwest, 20% of which is used for the state of Rajasthan to the agriculture. northeast, Madhya Pradesh to the east, and by Maharashtra, Union territories of Diu, Daman, Dadra and Nagar Haveli to the south. Language The Cambodian language is Gujarati, Hindi, Kutchi Khmer. Population As of 2013, Cambodia has an The population of Gujarat estimated population of State was 60,383,628 15,205,539 people. according to the 2011 census data.

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CHAPTER- 6

SWOT analysis of Cambodia

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SWOT analysis of Cambodia:

SWOT analysis is a strategic planning method used to evaluate the Strengths, Weaknesses, Opportunities and Threats involved in a project or in a business venture. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favorable and unfavorable to achieve that objective.

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Strengths

Uniqueness Uniqueness helps distinguish Cambodia from competitors. Cambodia can charge higher price for their products, because customers can‘t get those products elsewhere easily. Unique Products have a significant impact, so an analyst should put more weight into it. Unique Products will have a long-term positive impact on the customers, which adds to its value. As automobile industry is concern the variety in design may give the advantages over the customers.

Strong supply chain The one of the major advantage to the Cambodia automobile industry is the strong supply chain. With the help of that manufacturer can easily get the parts and components of the cars and make the car easily and supply it to the customers easily. So it is one of the advantages to the industry over the competitors.

Economies of scale

Economies of scale is the cost advantages that Cambodia obtains due to size. The greater the volume, the greater the advantages. This qualitative factor will lead to a decrease in costs. This statement will lead to an increase in profits for this entity. Existence of Economies of Scales an easily defendable qualitative factor, so competitors will have a difficult time overcoming it. So it is one of the major strength of the Cambodia.

Developing market

Cambodia is a developing market economy that grew at an average rate of over seven percent in the last decade, driven largely by an expansion in the garment sector, construction, agriculture, and tourism. In 2014, the economy grew by an estimated seven percent and it is expected to continue to grow at a similar rate over the next two years. Per capita GDP increased from US$367 in 2003 to US$1,130 in 2014. As of 2012, the percentage of the population living below the poverty line was 17.7 percent (poverty line was US$1.20 per person per day), a three percent decrease from 2011.

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Weaknesses

Weak R&D

Automobile industry needs more research and development to succeed in the market. As far as Cambodia is concerned then the research and development is not advanced, it is one of the major weakness of the country. Due to that country can‘t beat the rival easily. So country faces the weakness of the research and development department.

Weak Brand

Cambodian brands are considered as weak brand because they are not as popular as another automobile country. Due to that Cambodia can‘t charge the same prices for goods and services as their competitors, because consumers don‘t value the brand. So it is one of the major weaknesses to go for global business.

Population of country

The population of Cambodia is around 15,408,270 as on 2014. Due to that the customers of the country will be very few and the skilled labors are less compare to the other rival country. So it can be the weakness for the country to compete with the rivals.

Opportunities

New services New services can help Cambodia to better meet their customer‘s needs. These services can expand Cambodia‘s business and diversify their customer base. Because in automobiles if the country can able to satisfy their domestic customers then only it can go for expansion in another country. And by this way country can easily develop its business.

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New technology In automobile industry, technology is most important. Because everything starts from there. If county is weak in the technology then it can‘t compete with the rivals and kicked out from the market. To come out with the innovation the company should adopt the advanced technology to meet their customer needs.

Emerging Markets Cambodia is an emerging market in the world. So country should understand their customer and provide accordingly to them. Emerging markets are fast growing regions of the world that enable Cambodia to quickly expand.

New Markets

New markets allow Cambodia to expand their business and diversify their portfolio of products and services. Country can target that market and easily expand the business. Because in every country the automobile sector is at its peak. So company can capture new market for the growth of the business

Threats

Bad Economy A bad economy can hurt Cambodia‘s business by decreasing the number of potential customers. Bad Economy has a significant impact, so an analyst should put more weight into it. Bad Economy will have a long-term negative impact on this entity, which subtracts from the entity's value. These statements will have a short-term negative impact on this entity, which subtracts from its value. This qualitative factor will lead to an increase in costs. This statement will lead to

72 | P a g e a decrease in profits. "Bad Economy is a difficult qualitative factor to overcome, so the investment will have to spend a lot of time trying to overcome this issue.

Threat of rival country

The biggest threat to the Cambodia is the rivals. Many rivals found the opportunity in the Cambodia to do the business. Such as Toyota, Maruti Suzuki, Mercedes etc. Due to that the Cambodian country can‘t stand high. And country may lose its customers. So the availability of the rivals can create threats as well.

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CHAPTER - 7 SWOT analysis of Gujarat

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SWOT ANALYSIS OF GUJARAT

Strength

Land Available in plenty

As Gujarat is known for tourism and for manufacturing unit lands are available in plenty it is the biggest strength for automobile sector for gujarat

Surplus in power capacity

Gujarat has capacity of 278.33 GW so there is so much surplus in power capacity which is very necessary for automobile sector.

Committed political leadership

Gujarat has already established itself as a prospering state in terms in industrialization and due to vibrant summit has catapult immense growth for automobile sector.

Enjoys the challenges status

As Gujarat state is in different sector so it enjoys the challenges and in automobile sector especially for manufacturing unit there are lots of challenges are there.

WEAKNESS

Lack of skilled technical manpower

In Gujarat labor‘s availability is high but technical and skilled labors are not enough sound to fill requirement of global company

Research and development

Gujarat if far behind in making investment in research and development into particular industry which makes it less lucrative for global giants

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Complexity in taxation

Complexity in taxation part is the major weakness for automobile industry at Gujarat. Different taxes like custom duty, excise duty, central sales tax, value added tax, service tax are imposing on automobile industry.

OPPORTUNITIES

Public private partnership model

Gujarat government has public private partnership model which provide wide range of opportunity for any automobile industry to grow

Various support activities

Various support activities like the assembly line and manufacturing, manufacturing of auto components, automotive design centre etc. provide opportunity to do business with ease.

Industrial area

Various industrial areas for automobile industry like in sanand and halol specially for automobile industry and special economic zone provide opportunity for automobile industry to grow.

Stability of government

Stability of government and actively involvement of government into industrial growth is helpful in development

THREATS

Competition by other states

A major threat for automobile industry at Gujarat was to competition by other states like Maharashtra and Tamilnadu. Government of other states provides lucrative offers to automobile industry which makes Gujarat less important.

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CHAPTER - 8 SWOT analysis of Himachal

Pradesh

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SWOT OF HIMACHAL PRADESH

Strength

 Labor force

Strength for automobile industry at Himachal Pradesh is high availability of labor force like 65% of workers at operation level are available out of total work force in automobile industry.

 Business friendly policy

Government of Himachal Pradesh has business friendly policy which is fiscal and other policy incentive for automobile industry

 Infrastructure

Himachal Pradesh provide wide range of infrastructure facilities like industrial area hydropower projects which provide 24*7 electricity to industry

 Stable government

Himachal Pradesh has stable government with ruling of only one political party which provide stable environment for growth of automobile industry

Weakness

 Road infrastructure

Road infrastructure is major weakness for automobile industry as most of the roads are hilly and only particular types of vehicles are suitable for it.

 Long and complex procedure

To set up plant of automobile at Himachal Pradesh requires lots of procedure for registration and permission from various authorities which makes it complex in nature

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Opportunity

 Special economic zone

Government of Himachal Pradesh set up various industrial areas at different location in state and also spend us $ 1.8 billion to develop special economic zone which provide opportunity for automobile industry to set up manufacturing plan

 Franchise showrooms:

As now a day‘s automobile industry of India is into booming segment. All leading automobile companies are ready to do business with India. Himachal Pradesh also has vast opportunity now a day in terms of doing business with franchise showrooms.

 Lower competitions:

As mention earlier most of business at Himachal Pradesh is through franchise business, so if you choose well geographical location for the franchise and according to gets the competitive advantages because of lower competition.

 Auto parts:

Auto parts of the same automobile company have also a good business opportunity for doing the business simultaneously with it.

 Economic growth

Himachal Pradesh is stable in economic growth and looking for 8.5% growth rate in current year which provide opportunity for growth of automobile industry at there.

Threats

 Absenteeism and lack of industrial culture

At Himachal Pradesh very high rate of absenteeism ration in terms of employment and frequently disturbance of labor union leads to threat for automobile industry.

 Less attention of industrial developers

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Most of the industry leaders not provide enough attention towards Himachal Pradesh because of its adverse geographical condition and high power tariff.

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CHAPTER - 9 Bilateral trade opportunity

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BILATERAL TRADE OPPORTUNITY

Automobile industries of the Gujarat and the automobile industries of the Cambodia has a very good chance of making the bilateral trade in this sectors from this the state and the country can establish the foreign relation to be strong and the value of the both the place will increase to making a bilateral trade in automobile industries.

Following companies are in Gujarat which is having there manufacturing plant.

Tata motors General Motors Ford motors Asia motor works

TATA Motors:

Tata Motors‘ plant for the Tata Nano at Sanand, located in the Ahmedabad district of Gujarat. The capacity of the plant, to begin with, will be 250,000 cars per year to be achieved in phases, and with some balancing is expandable up to 350,000 cars per year. Provision for further capacity expansion has also been incorporated in this location.

Built in a record time of 14 months starting November 2008, the integrated facility comprises Tata Motors‘ own plant, spread over 725 acres and an adjacent vendor park, and spread over 375 acres, to house key component manufacturers for the Tata Nano.

General Motors:

GMIPL operates vehicle manufacturing plants in Halol, Gujarat and Talegaon Dabhade, Maharashtra; it maintains headquarters in Halol and Gurgaon and a large technical center in Bangalore. It‘s Halol and Talegaon Dabhade manufacturing plants have a combined production capacity of 225,000 vehicles annually.

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Ford Motors:

The Sanand Facility at a Glance:

 Investment of over US $1 billion  Spread over a total of 460 acres comprising Stamping, Vehicle Operations, Engine Plant, Service Parts Production  Initial production capacity of 240,000 vehicles and 270,000 engines per annum  This plant will launch with approximately 2500 employees  Paint facility at Sanand will use Ford‘s innovative three-wet paint process that allows three coats of paint to be applied and dried simultaneously. The energy efficient process significantly reduces wastage, energy consumption and helps in lowering paint shop carbon-dioxide emissions by up to 25 percent.  The state-of-the-art press shop, for example, will not only ensure that we produce the highest quality parts, but it will also maintain an exceptionally clean environment for employees with positive ventilation being deployed  Ford is working to provide safe drinking water to children in kindergartens run by the government in 70 villages. The company has introduced its Happy Schools program in 10 schools close to the plant, designed to address gaps in academic support, health, nutrition and infrastructure requirements that restrict schools from imparting holistic education

Asia Motor Works:

The Company‘s manufacturing facility in Bhuj, Western India is spread over 2 million sq. meters and produces vehicles for a range of civilian and defence applications. AMW has invested over Rs20 billion in the plant and has a capacity to produce 50,000 vehicles.

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