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INDIA GL BAL BUSINESS UK Edition

Sitharaman wields the tax axe

11 14 54

DESPATCH BOX THE BIG INTERVIEW SOCIAL IMPACT FOCUS The UK provides a compelling India will remain a very attractive Building impactful India-Scotland offer for Indian businesses place to do business connections Peter Estlin, Lord Mayor of Gaurav Dalmia, Chairman, Jess Kemp,Senior Partnerships Officer, the City of London Dalmia Group Holdings Social Enterprise Academy

September 2019 www.indiaincgroup.com

EDITORIAL

per cent to make it competitive vis-à-vis China and the South East Brexit quake leaves Asian economies. The lower tax rate of 17 per cent is expected to make India an attractive destinations for companies that are looking for Boris shaken, but not alternatives to China in the wake of the China-US trade war. Many of these companies are considering locations in Vietnam and other ASEAN nations. High tax rates were considered the major reason stirred for not considering India. Of course, other issues, like rigid labour laws and poor infrastructure were also hobbling fresh investments in he UK Supreme Court declaring Boris Johnson’s prorogation India but these, too, are being addressed by the Modi government. of Parliament unlawful has shaken up the British political system to its very core, with political experts scrambling for ‘India Global Business’ believes that these tax cuts will spur a fresh Twords beyond historic and unprecedented. investment cycle and lift the Indian growth rate, which had been lagging in recent quarters, to a much higher trajectory. "The decision to advise Her Majesty to prorogue Parliament was unlawful because it had the effect of frustrating or preventing the ability of Parliament to carry out its constitutional functions without reasonable justification,” declared Lady Hale in the unanimous verdict of 11 judges from the UK’s highest legal authority. The fact US support for Modi that a sitting Prime Minister’s political move to suspend Parliament was declared null and void has triggered a constitutional crisis like no other, forcing Johnson to dash back from the UN summit in New on Kashmir, opens York to confront belligerent MPs in the Commons . trade talks But the questions go beyond just the realms of politics. While he Howdy Modi rally Johnson remains determined in Houston and mutual not to budge from his “do or die” bonhomie on display Tthere between the Indian Prime pledge for Britain to leave the EU by the 31 October deadline, Minister and US President the uncertainty for the business Donald Trump and their community has only further interaction on the sidelines of compounded. The brakes on the UNGA in New York had business as usual have been messages for India, the US, applied for far too long as the Pakistan and even China. revolving door at Downing Street carries on swinging. A very important development, which has got lost in the The Pound Sterling has already euphoria over the rally, is had a series of turbulent months Trump’s assertion that a as the Johnson-led government trade deal between the two continues to ramp up the rhetoric countries is imminent. Even a over no-deal Brexit and the latest limited trade deal that restores jolt of a legal nature will do little Generalised System of to calm those nerves. In a recent Preferences benefits to some edition, ‘India Global Business’ Indian exports to the US will had pictured Johnson piloting a soothe frayed nerves on both WWII plane with the headline: sides. Kamikaze Boris? Perhaps the time is coming close when that Modi has also given a new question mark will no longerbe potency to the 3-million strong required! and affluent Indian American diaspora. Astute political observers would not have missed that Texas is now emerging as a key 2020 presidential election battleground and the Indian American vote and their India presses the dollars will be very valuable. growth reset button Then, as noted columnist Roger Cohen noted in the NYT: “Less than two months after Narendra Modi… revoked Article 370 of the Indian Constitution… Trump chose to signal approval by standing ndian Finance Minister Nirmala Sitharaman last week side-by-side with the Prime Minister.” unveiled her boldest tax move yet. In one fell swoop, she cut India’s corporate tax rate from 34 per cent to just over 25 per There were energy deals that preceded the rally and a meeting Icent. Further, she announced a new tax rate of 17 per cent for in New York that followed it, but this was possibly the biggest manufacturing companies setting up after 1 October this year and takeaway from the Houston rally. Trump and the US administration commence operations before 31 March 2023. may not want to publicly articulate this stand but the image of the US President and the top leadership of both the Republican These are, easily, the most aggressive and far reaching direct tax and Democratic parties looking on while Modi spoke about his cuts for the Indian corporate sector and redeem a pledge made government’s rationale for defanging Article 370 could well become during the Modi government’s first term to reduce the rate to 25 the defining feature of the Indian PM’s US visit. www.indiaincgroup.com September 2019 3 CONTENTS The UK Edition of'India Global Business' leads with the biggest shakeup in India's tax regime with the announcement by Finance Minister Nirmala Sitharaman to cut corporate tax significantly to spur growth. The rest of the package covers the usual range of analyses and interviews.

DESPATCH BOX EDITORIAL 3 India presses the growth reset 11 The UK provides a button compelling offer for Indian businesses Peter Estlin, Lord Mayor of the City of London

THE BIG INTERVIEW

14 India will remain a very attractive place THE BIG STORY to do business Gaurav Dalmia, Chairman, Dalmia Group Holdings

GLOBALLY SPEAKING

18 UK’s Labour Party is recklessly out of sync with New India by Manoj Ladwa, India Inc. Founder & CEO

EYE ON BREXIT 7 Modi’s Houston meeting with CEOs to enhance India’s energy security 20 Brexit can potentially act as a reset button for by Arnab Mitra British manufacturing Fhaheen Khan, Economist, Make UK

4 September 2019 TECH SPEAK INTERVIEW

23 The UK-India Tech Partnership: Supporting our future workforce 48 There is a high Julian David, CEO, techUK demand for Indian organic food products Rohan Grover, Director, Nature Bio Foods GUEST COLUMN

26 What’s ailing India’s solar rooftop ecosystem? Andrew Hines, Co-Founder, 51 EXTRACTS CleanMax Solar Leveraging the UK’s Deep-rooted Indian Diaspora CB Patel, Founder, Asian Business Publications Limited (ABPL), BIRD’S EYE VIEW SOCIAL IMPACT FOCUS 28 India-UK Maritime Security 54 Building impactful India-Scotland connections Convergences and Opportunities Jess Kemp,Senior Partnerships Officer, Rahul Roy-Chaudhury, Senior Social Enterprise Academy Fellow for South Asia (IISS) 56 SPECIAL REPORT India expands mark in global university rankings HOTSPOT by India Inc. Staff 30 Queensland – a smart investment decision Gitesh Agarwal, Commissioner – India at Trade & 60 LAST WORD Investment Queensland Sitharaman wields the tax axe 34 EXPERT VIEW: The flexibility offered by e-learning holds many merits John Ingram, CEO, Pamoja Education Published by Incorporating COUNTRY FOCUS 36 Howdy Modi: Trump rolls out the red carpet, but follow-throughs will be crucial by India Inc. Staff

REGION FOCUS www.indiaincgroup.com 41 No slowdown in as foreign investments pour in © India Inc. Limited, all rights reserved. by India Inc. Staff Reproduction in whole or in part without our written permission is prohibited. Views expressed GLOBAL INDIAN by our contributors are their own and do not necessarily represent the views, policies of India Inc. While every effort is made to achieve total accuracy India Inc. cannot be held responsible for 44 India’s talented any errors or omissions. workforce will play a key role in improving business Editorial solutions [email protected] Pratap Sarker, President, Advertising & Sponsorship Global Commercial PRICE £4.95 [email protected] PUBLISHED IN LONDON Solutions, Conduent

www.indiaincgroup.com September 2019 5 6 September 2019 THE BIG STORY

Modi’s Houston meeting with CEOs to enhance India’s energy security by Arnab Mitra

The Indian Prime Minister’s meeting with the heads of major US oil companies and his government’s tango with the Middle East and Russia will ensure that the country gets adequate hydrocarbon supplies to power its growth aspirations.

he recent attack on Saudi the US and European energy sector. the top campaign contributors to Aramco’s plants, which resulted His round table included the CEOs the Republican Party. Thus, having in the suspension of 5 per cent of ExxonMobil, BP, Total, Tellurian, a long-term relationship with these Tof the world’s crude oil supplies, led Schlumberger, Baker Hughes, companies and their influential to violent swings in global oil prices. Cheniere Energy and Dominion CEOs, who enjoy tremendous clout In the two days following the attack, Energy, among others. in Washington, makes political and Brent futures went up by almost 20 strategic sense for India. per cent to $71.95 per barrel and WTI India already imports about $4 billion futures by 15.5 per cent to $63.34. worth of oil and gas from the United The deals in the pipeline This brought home the importance of States and there are reports that Modi, who drove to the meeting with ensuring India’s energy security and this could double in the near future. the head honchos of oil companies highlighted the criticality of Indian Also, US Secretary of State Michael straight from the Houston airport, Prime Minister Narendra Modi’s Pompeo has promised India adequate tweeted: “It is impossible to come to meeting with leaders of the US oil crude oil supplies in the wake of US Houston and not talk energy! Had and gas industry in Houston on 21 sanctions on Iran. a wonderful interaction with leading September, which had been fixed energy sector CEOs. We discussed months in advance. Engaging US energy majors is methods to harness opportunities in important not only for India’s the energy sector. Also witnessed the Why the Houston meeting with oil energy security but also for other signing of MoU between Tellurian and CEOs is important collateral benefits. It is well known Perronet LNG." Modi met the virtual who’s who of that energy companies are among www.indiaincgroup.com September 2019 7 THE BIG STORY

He was referring to the agreement But energy is vital for India to achieve to negotiate the import of five million its goal of becoming a $5 trillion tonnes per annum of LNG by the ENGAGING US ENERGY economy by 2025 and provide 24x7 public sector Indian company from MAJORS IS IMPORTANT power for every Indian by 2022. the US energy behemoth’s Driftwood NOT ONLY FOR INDIA’S project in Louisiana in which the ENERGY SECURITY India’s energy mix Perronet may also invest $2.5 billion. BUT ALSO FOR OTHER Coal is still the largest source of energy in India. It accounts for 72 per Subject to further due diligence and COLLATERAL BENEFITS. cent of India’s electricity generation necessary approvals, Tellurian and and is also the main fuel used by Perronet are expected to finalise the sectors such as cement and steel. agreement by 31 March 2020. Why energy security is important India imports 82 per cent of its oil BP Energy Outlook 2019 estimates Then, (IOC), and gas requirements, mostly from that coal’s share in India’s primary India’s largest oil refiner, signed two the Middle East but also from the US, energy consumption will fall from contracts to buy 4.6 million tonnes Russia, Africa and South America. 56 per cent in 2017 to 48 per cent of US crude oil in 2019-20 from In 2018-19, the country’s oil import in 2040. This is more or less in line Norway’s Equinor ASA and Algeria’s bill was about $112 billion, a jump of with the estimate of NITI Aayog, the state energy company Sonatrach. about 30 per cent from $88 billion the government’s official think tank, which previous year. Local production has put the figure at 44 per cent. The Earlier reports said the world’s been stagnant, and this is unlikely share of oil will fall from 29 per cent to most valuable energy company, to change in the foreseeable future. 23 per cent while that of renewables ExxonMobil Corporation, is likely to Even the production of oil from will rise five-fold over this period to 16 enter a partnership with the public overseas fields owned by Indian per cent. sector GAIL India Ltd to set up companies hasn’t been rising fast a green energy platform in India. enough to compensate for stagnating India’s energy demand is expected India may also pick up a stake in local output. to grow at a CAGR of 3.7-4.5 per ExxonMobil’s offshore Stabroek block cent per year till 2047, according to in Guyana, which has estimated This will have to change quite the NITI Aayog. The corresponding reserves of more than five billion oil- drastically if India is to achieve the figure for electricity demand is 5.4-5.7 equivalent barrels. target set by Modi of reducing oil per cent. And although the country and gas imports to half the current is home to 18 per cent of the world’s And as has been widely reported in figure by 2030. As an interim goal, population, it consumes only 6 per the Indian media, Indian oil majors the Indian government is targeting a cent of the world’s primary energy. have invested about $4 billion in US 10 per cent reduction in oil and gas shale gas assets. imports by 2022. This is expected to change quite

8 September 2019 THE BIG STORY dramatically as India’s per capita energy consumption of 521 kgoe in 2014, which is one-third of the world average, first catches up and then overtakes its share of the world’s population.

The renewable energy push Pushing this surge in energy consumption is the Modi government’s aggressive and ambitious target of setting up 175 GW of renewable energy (RE) – solar, wind and biomass – capacity by 2022. According to data available on the website of the Government of India’s Ministry of Power, the country had an installed capacity of slightly more than 80 GW of RE, or a little less than half the target, as on August 31, 2019.

Beyond that, India has an even more ambitious goal of setting up 450 GW of RE capacity by 2030 but this will come with its own set of problems.

Infirm power RE, especially solar and wind power, are infirm sources of power. In India, power demand peaks in the This makes security of gas supplies That means, unlike thermal, hydro evenings when solar power plants imperative for India’s energy security. and nuclear power, they cannot be can no longer generate electricity. produced on demand. Solar power But battery storage technology is The problem with coal plants cannot generate electricity not yet sufficiently advanced to store India is the world’s second-largest when the sun is down. Wind power the quantum of power needed to coal producer after China with a share plants cannot generate power when compensate for the shortfall. of 10 per cent of the global output and wind speeds are below a particular has the fifth-largest coal reserves in threshold. the world, according to IEA. India’s share of world coal consumption is 13 Solar power generation stops in THE COUNTRY WILL per cent. the evening, leaving the grid with HAVE TO MOVE FAST a sudden and massive withdrawal ON EASING LAND However, 87 per cent of Indian of supply between 5 pm and 6 pm ACQUISITION AND reserves of this mineral fuel is non- every day. The grid faces a similar ENVIRONMENTAL AND coking coal, forcing the country to “shock” from wind power withdrawal FOREST CLEARANCE import 80 per cent of its coking coal when winds stop. This can result in needs. Then, India’s coking coal grid instability and huge outages if NORMS TO FACILITATE reserves are of a poorer quality alternative sources of power are not RAPID EXPANSION OF than those available elsewhere. available to substitute for the power COAL PRODUCTION IN This means that India will have to that is withdrawn. THE COUNTRY. continue importing this fuel whose use is expected to triple to 180 million Thermal power plants are not able tonnes by 2030. to ramp up fast enough to replace This makes it imperative for India this. Among power sources, only to secure adequate and reliable India also has to import about 20 per hydropower plants, gas-based power supplies of gas as a fuel for power cent of its thermal coal requirements plants and nuclear power plants can plants that can ramp up or ramp as Ltd (CIL), till recently do this. down on demand since hydro and the monopoly merchant producer nuclear power plants have long of this commodity, which accounts But India lacks sufficient capacity gestations periods and entail huge for 84 per cent of the country’s coal in these. The alternative is battery environmental costs. production, is unable to increase its storage systems. www.indiaincgroup.com September 2019 9 THE BIG STORY

THE MODI GOVERNMENT WILL HAVE TO CAREFULLY FINESSE ITS HAND TO MANOEUVRE BETWEEN THESE COMPETING GLOBAL GEOPOLITICAL CONFLICTS TO DIVERSIFY CRUDE SOURCES AND ENSURE INDIA’S ENERGY SECURITY.

also providing oil for the 2.5 million tonne storage facility at Pudur in .

Then, Saudi Aramco will invest $15 billion to buy a 20 per cent stake in the oil refining and petrochemicals business of , India’s largest private sector company. This will ensure reliable supplies of crude, the main raw material for Reliance’s refining and petrochemicals businesses, at a reasonable cost. A large Saudi stake will provide its Jamnagar refinery, the largest in the world, a secure insurance against Pakistani air and missile attacks in case of hostilities. output at the required rate. sources. But this, too, has fallen foul In a mutually beneficial deal, the of US sanctions on Moscow. Despite Saudis will gain a secure market for According to rating agency Crisil, this, ONGC Videsh, the foreign 500,000 barrels of oil every day, a CIL’s production will touch one investment arm of India’s national oil strong partner in the Indian market billion tonnes in five years against explorer, has a $6-billion investment and an entry into this market of 1.3 its target of doing so this year. Since in the Sakhalin oil fields in the region. billion consumers. the government has not moved on facilitating private participation in Last year, India and Russia agreed This will give the world’s largest oil merchant coal production despite to a sea link between Vladivostok producer a stake in India’s passing a law to do so last year, and Chennai that will cut down the energy security. India’s coal demand continues to transport time from 40 days at present outstrip domestic supplies. to 24 days, making it easier less Key to energy security costly to import Russian crude. India will also need to address some The country will have to move fast major internal challenges to ensure its on easing land acquisition and Thus, the Modi government will energy security. environmental and forest clearance have to carefully finesse its hand to According to an EY report: “… norms to facilitate rapid expansion of manoeuvre between these competing While the country has surplus coal production in the country. global geopolitical conflicts to diversify refining capacity and is an exporter crude sources and ensure India’s of petroleum products, major However, the good news is India’s energy security. investments will have to be made peak electricity deficit has declined in the domestic upstream industry from 12.7 per cent in 2009-10 to 0.8 Strategic moves and to acquire hydrocarbon reserves per cent in 2018-19. To guard against any major disruption abroad. Additionally, key areas of in energy supplies, the Indian action are: Walking on geostrategic eggshells government is building a strategic • Accelerated development of The Middle East, the main source reserve of 5.33 million tonnes of energy infrastructure of hydrocarbon supplies to India, is crude in (Karnataka), • Human resource development a volatile region. US sanctions on Vishakhapatnam (Andhra Pradesh) • Technological upgrade Iran, which supplied up to 10 per and Pudur (Karnataka) to provide for A more conducive policy environment cent of India’s crude requirements 10 days of supplies. coupled with an effective regulatory until recently, has adversely impacted regime is, without doubt, the basis India’s energy security. The Abu Dhabi National Oil Company for accelerated growth of domestic (Adnoc), has provided half the crude energy resources. Energy security India has turned increasingly to oil that is stored at the 1.5 million needs integrated action by all Russia to diversify its crude supply tonne Mangalore rock cavern and is stakeholders.”

10 September 2019 DESPATCH BOX

The UK provides a compelling offer for Indian businesses by Peter Estlin

The Lord Mayor of the City of London reflects on the opportunities for collaboration between the UK and India within the digital sphere as he leads a major fintech delegation to India.

s a businessman who has Elsewhere, the biggest group in India, top to deliver on the campaigns travelled to India no less than TATA, continues to grow, and in a and initiatives of Prime Minister 20 times over three decades, it meeting with Chairman Natarajan Modi and his government. In New Awas fantastic to return to the country Chandrasekaran, I was impressed Delhi, I met with the Secretary at as Lord Mayor of the City of London, by their amazing digital vision for the the Department of Economic Affairs, and principle ambassador for the UK future. PolicyBazaar, India’s largest Atanu Chakraborty, who was hugely financial and professional online insurance marketplace, is also encouraging about the future of services sector. steaming ahead with its expansion economic reforms in the country. plans, and I had the pleasure of This positivity was reinforced during Last week, I visited three cities – chatting to them about the future of a meeting with think tank NITI Delhi, Hyderabad and Mumbai – as the sector in India. Aayog, where I gauged some real the head of a delegation of UK firms. forward thinking on government Over this time, we have learnt a lot, That’s not to say there isn’t room for priorities, including health, renewable but more importantly, we have seen foreign expertise in the Indian market. energy and agriculture, and where huge areas of potential for further UK- As a world leader in financial and the UK can assist in these areas. India growth. professional services and fintech, the Outside of the capital, I also met UK continues to provide a compelling with representatives from the One thing that struck me was the offer for India in many areas and is state governments of Telangana sheer scale and pace of innovation well placed to act as a knowledge & Maharashtra – both competing taking place within the private sector. partner to fill gaps in know-how and to attract the best talent, the best During a presentation by the head skills. But in the face of increasingly companies and create the best of , we heard the incredible advanced innovation and competition ecosystem, and both providing story of the company’s growth from in India, it is clear that UK companies compelling offerings to UK companies small start-up to giant fintech. Now need to think carefully about where wanting to enter the Indian market. boasting 500 million active users they fit, and UK Plc needs to be and an array of products, the firm is structured in its overall approach What also came across in all my a prime example of first-class Indian when seeking Indian partners. meetings was a clear commitment innovation, with plenty of potential to from those I met to make a success grow even further. Another important takeaway from of the Gujarat International Finance my visit is the keen focus from the Tech-City (GIFT City). While growth www.indiaincgroup.com September 2019 11 DESPATCH BOX

AS A WORLD LEADER IN FINANCIAL AND PROFESSIONAL SERVICES AND FINTECH, THE UK CONTINUES TO PROVIDE A COMPELLING OFFER FOR INDIA TO ACT AS A KNOWLEDGE PARTNER TO FILL GAPS IN KNOW-HOW AND SKILLS.

From India to the UK, Ola has arrived! in Modi’s visionary new city has together, especially in the area my visit has helped to accelerate. In been slow, it’s obvious to me that of fintech. areas as diverse as cyber security, this is a project that the government insurance, biometric verification is committed to, and I expect to see I also hope we continue to build and payments, each delegate flew Available in South Wales, South West England, many more initiatives with regards to on our relations with several trade the flag for UK Plc and provided GIFT in the near future, particularly associations, including the Data a glowing glimpse of the massive Merseyside & the West Midlands and on our after the high-speed rail link has Security Council of India, CII and potential UK fintech has to offer India. been built. DCB Banks, all of which are hugely I, for one, look forward to further journey across the UK. ambitious conveners with an stories of success over the following Going forward, the City of London international outlook. There is plenty months from my delegation, but also Corporation that I represent will, of of appetite for partnerships with companies across the UK. At the course, stay abreast of developments industry, in areas from cyber security City Corporation, we stand ready to in GIFT and across India through our and fintech, to promoting direct support all firms entering India. Ola takes you places long-standing representative office learning and collaboration, and my in Mumbai. But we will also continue advice for any budding UK partner is to home in on the specifics in the to work with organisations like Invest Alderman Peter Estlin is market you want to deliver. India to accelerate trading ties in the Lord Mayor of the City financial and professional services. of London, and a principle Of course, I gave this same advice A prime example of a key player in ambassador for the UK to members of my hugely impressive Download the ride hailing app the Indian market driving the foreign financial and professional business delegation, each of which direct investment agenda, I hope in sector. the future we can work more closely has an existing India story that I hope

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www.indiaincgroup.com September 2019 13 THE BIG INTERVIEW

India will remain a very attractive place to do business

Gaurav Dalmia, Chairman of Dalmia Group Holdings, discusses the current economic and business climate in India while also highlighting some key lessons for Private Equity investors considering the Indian market.

14 September 2019 THE BIG INTERVIEW ow would you classify the It's become a mainstream financing for the next decade, much like what Indian investment climate tool. The industry is mature enough China has achieved, then merely against the backdrop of an now that we see at least six different sorting out the hygiene factors will Heconomic slowdown? distinct segments appearing: not be enough. Incrementalism and buyouts, growth capital, technology tactical views will not take us there. India has been quite a hot venture capital, private equity style We'll need fundamental and strategic destination for investment over the investment in public companies, changes. The policy prescription then past few years. In the fiscal year structured credit, and real estate. would be that India needs to be a 2018-19, India attracted $44 billion Emerging markets private equity bets part of more free trade agreements, in inbound FDI. This is capital that are on growth and have high relative which it needs to negotiate and chooses target destinations freely. In valuations, while developed markets shape to its advantage. India needs the same period, Vietnam attracted private equity bets are on stable cash to invest in physical infrastructure for about half that. Though for a fair flow, low valuation, and financial better inventory turnaround, and in comparison, these numbers should engineering. Hedge fund managers education to get productivity gains be adjusted for relative economy use the term alpha to measure the that are the bedrock of economic size etc. They point to the fact that extra return from a particular market growth. Two relevant points worth India is an attractive investment or strategy. From the figures I have mentioning here. One, these have destination. On other parameters, seen, if you compare like-with-like, long gestation periods and will the signs may look weaker. For India does generate 300 to 400 basis transcend political and election instance, Nomura had a report on points alpha in dollar terms over cycles. Inevitably, in the medium the US-China trade war and which developed markets. I was told that term, there will be noise around such countries were gaining trade share for the global behemoth Blackstone, profound changes. Which brings me and ultimately investment share. India has been the best performing to my second point. The solutions are Taiwan and Vietnam were large investment destination over the past not just in the arena of economics. gainers, I suspect, mostly because few years. If you compound this They will fall into the realm of political of their electronics manufacturing alpha over a decade or more, it can economy, judicial reform, behavioural base. Malaysia and Chile were also be a real outlier. science led nudging, international up there. India was not as significant diplomacy etc. The whole country – as it ought to be. India's household and not just the government – will savings rate as a percentage of THIS SLOWDOWN IS have to make hard decisions. GDP and our investment rates NOT THE END OF THE are also in decline. To me, if this WORLD; WE HAVE BEEN Is India's $5-trillion vision on track; is a secular trend, it is the most THROUGH DOWNTURNS what are the crucial sectors to worrying element. There can be a BEFORE. OBVIOUSLY, WE watch out for in this regard? chicken-and-egg type of argument: what came first, the slowdown in SHOULD NOT IGNORE IT. There are the usual suspects. Let's the economy or the slowdown in BUT WE SHOULD ALSO look at a sample. It might sound investments, but these reinforce NOT GET OVERWHELMED almost trivial, but tourism would each other. Given high capacity BY IT. be a sector we need to develop. utilisation levels in many sectors, If one takes direct and indirect the need for infrastructure and employment generation, this is the given the low penetration levels in What are some policy reforms you largest employer in the world. And so many consumer categories, I would highlight as contributing there is quite a bit of headroom for believe that India will remain a very to global investor interest in the India. For instance, tourism is 5.5 attractive place to do business. This Indian economy? per cent of total exports from India, slowdown is not the end of the world; while for countries such as Australia, we have been through downturns To begin with, one should be clear which we normally consider as an before. Obviously, we should not that there are different end goals. agriculture and mineral exporter, ignore it. But we should also not get If the end goal is 7 per cent or so tourism's share of exports is overwhelmed by it. growth, which I believe is India's almost 10 per cent. Infrastructure natural fighting weight, then we is another obvious one. We need Does the outlook for a continued need to ask how to get the hygiene to over-engineer our infrastructure strong growth momentum in factors out. Financial sector liquidity, with a long-term demand estimate private equity in India look plugging the delays in the GST and not play continuous catch-up. promising? system, relook at agricultural support Social infrastructure like health and prices, lower real interest rates – the education need to be prioritised via India has seen tremendous private prescriptions would be of this type. private sector investment. This would equity interest. Last fiscal, some $37 However, if one wants to go into a have multiplier benefits. South East billion was invested by PE funds. different orbit, say 10 per cent growth Asian countries have shown this www.indiaincgroup.com September 2019 15 THE BIG INTERVIEW and that is where they falter. Four, add value to investments. Sequoia, Blackstone, Warburg Pincus, they have all built their franchises in India not because they have large wallets, but because they have a deep understanding of businesses and appreciate the unique challenges of scaling in India. It is surprising to me; how many private equity investors have an invest-and-pray strategy for all practical purposes. And five, while investors always marry a top-down view with a bottom-up view, in India, we think a bottom-up view needs more emphasis since most top-down views are quite attractive given the growth; we have seen in so many industries over the past two decades. Having said this, global private equity investors are in their third capital rotation cycle from India now, and all in all, they have become excellent brand ambassadors for India!

On a personal note, what inspires your commitment to the primary education sector?

It is well known that primary education, particularly girls' education, has the best payoffs for society. The North-South divide one to be the case. Agriculture is rather What would be your checklist can see is closely linked to better inefficient in India. Big structural for PE players eyeing the Indian education in southern India. Most changes need to be made here and market? of South East Asia has seen how will involve land reform, scaling, investments in education pay off water management, insurance, We have been making private 10-15 years later. Given our size and logistics etc. Financial inclusion is equity investments since the ‘90s. demographics, we have a unique another important consideration. Some lessons stand out. One, challenge. And a unique opportunity. My colleagues did some research make decisions locally. Helicopter Personally, I am very committed to a few years ago. In 2016, the style management will not work. primary education. We have done capital needs of India's small and One can see the difference in the quite a few things in this area. Most medium enterprises was $529 returns for investors with deep on recently, maybe a year or so ago, we billion. Of this, formal sources such the ground presence and those contributed to a Silicon Valley-based as banks funded $116 billion and who don't have local underwriting charity called Room to Read, which finance companies funded $63 capability. Two, because the Indian has a proven template for improving billion. Informal, friends and family private equity story is that of funding literacy and is very successful in sources funded the rest, which growth, returns take time. So, this India. I also Chair Room to Read's was a staggering $350 billion. In neat year time frame for exits is not Indian Advisory Board. We are going 2020, it is estimated that SME's will optimal. If investors have longer through our own J curve of growth collectively need $ 990 billion or so. fund lives and more of a business- in India. Prime Minister Modi spent If we don't strengthen and formalise building temperament, the payoffs considerable time in a Room to Read the financial sector, it could be a can be huge. Three, most mistakes School in Varanasi on his birthday serious impediment to progress. We we have seen, at least the ones we last year. There is so much good are already seeing the disruptions have made, have a common theme: work being done and remains to be arising out of the NBFC sector. Let investors get seduced by assets and done. We have just touched the tip of me say, on the whole, the road to $5 give inadequate attention to people the iceberg. trillion is not for the faint-hearted. when underwriting new investments,

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www.indiaincgroup.com September 2019 17

BAT19_UK-India-ad-203x266-v1-5.indd 1 10/05/2019 18:15 GLOBALLY SPEAKING UK’s Labour Party is recklessly out of sync with New India by Manoj Ladwa

Labour’s politics is terribly and recklessly out of sync with Britain’s business and wider strategic interests in aligning with democratic India. The US Democrats would do well to take note.

he Labour Party has historically The resolution about the Indian state through adopting this resolution, enjoyed good relations with of Jammu & Kashmir is ill conceived, seeks the continued oppression of India and its 1.5-million misinformed, and will only further these communities. Tstrong diaspora community in the alienate the vast majority of Indians UK. The overwhelming majority from Labour. Under Jeremy Corbyn it is obvious of British Indians have traditionally that the relationship has become voted for Labour. It has long been fractured. Having been a member of felt that the Labour Party has best the Labour Party for over 20 years, represented the interests of immigrant THE RESOLUTION before I resigned soon after Corbyn communities. But no longer. ABOUT THE INDIAN took over, and having run many of its STATE OF JAMMU community engagement programmes, In the biggest jolt to India, and the & KASHMIR IS I have had first-hand experience of Indian community’s relationship with ILL CONCEIVED, its changing face. I therefore have no Labour that I can ever remember, the hesitation in saying that Labour now party at its annual conference earlier MISINFORMED, AND has an institutional bias against India this week passed a resolution which WILL ONLY FURTHER and Indians. demanded international intervention ALIENATE THE VAST and a campaign for self-determination MAJORITY OF INDIANS I left the Labour Party precisely in Kashmir. In uncharacteristic FROM LABOUR. because it no longer is a party of bluntness and speed, the Indian the many. Much of its policy-making Ministry of External Affairs (MEA) has been hijacked by a coalition spokesperson issued an instant of hard Left extremists and Jihadi rebuke with the words: “We regret the The revocation of Article 370 was sympathisers. Corbyn’s long-held uninformed and unfounded positions constitutional, democratic and just, support for separatist and often taken at this event”. Raveesh Kumar giving women, minorities, LGBTQ violent causes around the world is went further to declare that there is no communities at last the rights which well known. Under his leadership, question of India engaging with the the so-called “special status” denied. Labour pretends to speak in liberal Labour Party or its representatives on It’s ironic that Labour, the historic terms but panders to the most illiberal this issue. flag-bearer of liberal social values, ideologies. This is a slippery road

18 September 2019 GLOBALLY SPEAKING

to more divisions in British society, governments of all shades, to build an concluded: “India will need to be an precisely at a time when Brexit-torn otherwise robust trade, investment, important part of Britain’s global leg Britain needs politicians to build and strategic relationship. — if India sees its interests that way.” bridges with all communities and Under Corbyn, the days of New friendly nations like India. This Labour Party is, however, unable Labour, and its centrist politics, are to reconcile the re-emergence of its truly over. But the days of New India India is today the third-largest investor militant tendency in a much more are firmly here. It’s high time Labour into the UK and among the largest potent avatar, with a new, confident, smells the chai. But I fear it may be employers of the economy with the outward-looking, and economically already too late. The US Democrats leading that front. progressive India. Labour’s politics is would do well to take note. terribly and recklessly out of sync with Hence, with the prospect of a Corbyn- Britain’s business and wider strategic led government, one would not interests in aligning squarely with Manoj Ladwa is the blame Indian companies if they start democratic India. Founder and Chief to re-evaluate their UK investment Executive of India Inc. plans, just as British Indian voters In a book titled ‘Winning Partnership have started to turn their backs on – India-UK Relations Beyond and a former Chair of the their traditional party of choice. This Brexit’ that I edited, Britain’s former Labour Party’s Indian would be a real shame, given the Ambassador to India, Sir Michael Community Engagement immense work over many years Arthur, questioned whether the UK Forum. by both countries, and successive needed India more or vice versa. He www.indiaincgroup.com September 2019 19 EYE ON BREXIT Brexit can potentially act as a reset button for British manufacturing by Fhaheen Khan

An economics and public policy expert summarises how a no-deal Brexit will impact manufacturing in the UK and India.

n 1610, the English adventurer Sir from this made it appear as if the UK Consider the UK and India. India is an Thomas Roe was sent by Queen manufacturing sector was performing economic powerhouse today, with a Elizabeth on a mission to the well amidst the uncertainty. rising share of middle-class citizens IWest Indies in search of the fabled El However, the March deadline being with a growing taste for high-quality Dorado, the city of gold reported in pushed back to 31 October and foreign goods. According to the the myths of Spanish conquistadors. a series of unpredictable political Department for International Trade Roe failed, however, and instead events over the past three months led (DIT), trade between the UK and turned his attention to the East, many manufacturing subsectors to India totalled more than £20 billion seeking Emperor Jahangir’s blessings weaken, with average output falling in 2018, of which the value of UK to bring British trade to India. The severely since Q2. This, alongside result was to separate Britain’s a drop-in order both domestically interests from Europe’s path at a and internationally, means that time when England’s ambitions were many manufacturers are having too often stifled by those of greater their margins increasingly squeezed European powers. as they are unable to raise prices

Four centuries on and the UK is again seeking to diverge from its European IN TRYING TIMES, WHERE neighbours. In trying times, where BREXIT DOMINATES Brexit dominates the news with little clarity on its impact domestically or THE NEWS WITH LITTLE internationally, more trade with India CLARITY ON ITS IMPACT may be a step in the right direction. DOMESTICALLY OR Even so, there has been very little INTERNATIONALLY, MORE emphasis on how non-EU countries, TRADE WITH INDIA MAY like India, will be affected. BE A STEP IN THE RIGHT While the size of the manufacturing DIRECTION. sector has declined over time in the UK, the sector’s prominence has grown in India, resulting in two to cover costs over fears of losing export goods totalled £5.5 billion. In nations with significant productive key foreign suppliers. As a result, the grand scheme of exports, trade capacity in manufacturing. For business confidence has fallen to between the UK and India is relatively example, the UK is the ninth- its lowest since the referendum. A small – as a reference point, the value largest manufacturer in the world culmination of the above has now of manufactured goods exports from by output, accounting for 10 per left many UK manufacturers with little the UK to the US totals at £45 billion. cent of domestic GDP and 44 per desire to invest over the next year. cent of exports. India, however, has It is true that trade between the UK steadily grown its presence since the At the moment, it all seems to and India has remained surprisingly mid-2000s, to become the sixth- be gloom and doom for the UK. stagnant over the last decade, whilst largest manufacturer by output worth So, what is the bright side to this in the same timeframe, trade between approximately 15 per cent of domestic chaos? Are there opportunities the EU and India has increased. One GDP. for gain as opposed to losses for might like to believe that because British manufacturing? In theory, trade links between the UK and India In anticipation of the original Brexit many opportunities could exist. The are relatively weak, a no-deal Brexit deadline of 31 March, Make UK data outcome depends on new trade deals would not directly and substantially shows that output skyrocketed as a with both the EU and the rest of the impact India’s economy. result of stockpiling activities between world post Brexit. Q1 and Q2. The subsequent effects However, if we consider trade through

20 September 2019 EYE ON BREXIT the absence of effective trade, both UK and Indian manufacturers will feel the repercussions of a No-Deal Brexit. The only uncertainty is to what magnitude this will take place.

The final question remains: why has trade between the UK and India failed to progress? The value of trade between two of the largest economies in the world may seem insignificant but suggests that there is opportunity for growth. Brexit has the potential to act as a reset button for British manufacturing, providing the sector with a fresh opportunity to consider new trade relationships, to some extent. In a world where we no longer trade freely with the EU, perhaps simpler trade with India could be the answer. Of course, India and the EU are not perfect substitutes (i.e. interchangeable) as a trading partner for the UK due to a number of constraints, including the differences in business culture and time-zones. Moreover, a key determinant of trade is geographical proximity which illustrates that we tend to trade more with countries that are geographically closer to us. As far as we know, and as convenient as it would be, it is not the instruments of “value-added” in orders for basic metals, a key possible to move one country next to travelling through supply chains, then component of automotive productions. another for trade. Truly, if that were some proportion of the products that This fall in demand is primarily from possible, we would end up reverting India imports from the EU will contain North America, but a domino effect to Pangea! Despite this, the EU has elements of British manufacturing will ensue, impacting UK automotive successfully developed a strong (such as a component of a passenger manufacturers’ domestic and foreign trading relationship with India. vehicle, which is then completed in operations, as a result, thereby Germany). Subsequently, businesses affecting India. A no-deal Brexit will Although it is clear that the in India will be indirectly affected – a lead to further stagnation in the potential challenges that await UK concept that economists refer to automotive sector for the UK, with manufacturers from a No-Deal Brexit as spill over effects – in the form knock-on effects within the Indian will only impact India partially, an of increased delays in orders and automotive sector in the efficient trade agreement between the potentially higher prices from tariffs form of reduced demand for two nations could potentially mitigate applied to UK goods when trading vehicle components. the negative consequences of Brexit, with the EU. as well as fill the gaps left by reduced Nevertheless, the impact on India trade with the EU. It should be For example, take the UK’s will be less than that on the UK noted, however, that in a post-Brexit automotive sector, which relies itself, and its closest neighbours world, the EU is likely to remain the heavily on international demand to in the EU. Additionally, the UK UK’s most important trading partner survive and sees over 50 per cent primarily imports textiles, jewellery, and immediate negotiation efforts of UK produced vehicles exported machinery, pharmaceutical goods are expected to be concentrated to the EU. It is also one of the main and mechanical appliances from in stabilising UK/EU trade before UK subsectors integrated as part of India. A weak exchange rate will developing trade deals in the interest the automotive supply chain, within have already impacted the demand of UK manufacturing with the rest of the Indian economy, and includes for these goods. Without an the world. companies like JCB, Jaguar Land improvement in purchasing power, Rover and GKN Driveline. UK manufacturers will struggle to import important materials from India, Fhaheen Alam Khan is an Make UK’s Q3 Manufacturing Outlook raising the need for an efficient trade Economist for Make UK. publication highlighted a sharp fall deal between the two nations. In www.indiaincgroup.com September 2019 21 ‘100 UK India’ is an exclusive list of key influencers that enrich and make the UK-India relationship tick. The list is a result of painstaking research by our expert editorial team and profiles influential people in business, policy, the arts, culture and media.

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Contact us : For Business Development & Advertising Opportunities Email: [email protected] 22 September 2019 TECH SPEAK The UK-India Tech Partnership: Supporting our future workforce by Julian David

As the UK is predicted to have sizeable increase of tech-related jobs over the next few years, a partnership with India could be the solution to the futureproofing the workforce.

hether you call it the Fourth both countries now stand as equal international partner in research and Industrial Revolution partners with a strong two-way innovation. or Society 5.0, the investment story to tell. Wtransformations we are witnessing Undoubtedly the UK-India Tech across the globe bring unprecedented The UK is now the single largest Partnership lies at the heart of changes and enormous opportunities. western investor in India with British this relationship. Established as Equally, they present difficult businesses creating over 422,000 a stalwart example of a mutually challenges. Rapid advances in jobs since the turn of the century. beneficial relationship, the one- technology are fundamentally India, on the other hand, is the third- year-old Partnership has already changing the way we work and learn, largest source of FDI into the UK. Its delivered notable achievements. and how we connect with the world. In record number of 842 companies, The list of achievements is long, the UK, we must work together now with combined revenues of £48 billion, and the partnership is going from with international partners to reap the employ nearly 110,000 people in the strength-to-strength. This includes rewards of what this digitised world UK. The benefits of this unbeatable cluster partnerships to enable has to offer. combination are clear: new jobs, complementary regions to connect, a economic growth and new avenues new UK-India Tech Hub to fast-track We often refer to the Fourth Industrial to co-create and co-innovate. mechanisms for investments and Revolution as if it is a static moment trade-barrier resolutions. in time – a moment of huge upheaval Individually, both nations are thriving and then a settling down. The truth in this space. The UK’s digital There are, however, still opportunities is new technologies are becoming economy is worth more than any beyond tech trade and investment ever more sophisticated and other European country while India and to work together to address integrated, creating wave after wave is on course to becoming the second common challenges, including skills of change – with the UK and India largest market for internet in the and future workforce development. having built excellent foundations to world. Collectively, they bring visible ride these waves together. contributions to each other’s tech There is no denying that there is a sectors. Around 31 per cent of India’s widening supply and demand gap in The ties that bind both nations today investments in the UK are now in the STEM field in the UK. Over 83 per go beyond the usual rhetoric of tech, while the UK has increased cent of the tech community believe shared history, common language or its digital services exports to India their biggest challenge is access to cultural ties. The UK-India partnership to £344 million. Notably, India now skilled workers and the scarcity of has weathered the test of time and places the UK as the second-largest digital skills affects around 93 per www.indiaincgroup.com September 2019 23 TECH SPEAK cent of UK tech companies. While opportunities to embed locally, the of many collaborating partners, we currently have around 600,000 Tech Partnership is opening up including techUK – is now shaping digital vacancies at any given time, spaces for businesses to invest the conversation on how we can this number is expected to increase more in skills and contribute towards enable more frictionless movement to one million by 2020. By 2030, it futureproofing the workforce. of tech talent across the UK-India is forecast that around 35 per cent corridor. From the relaxation of rules of the existing workforce (11 million on ICT visas to recently announced jobs) will become automated while an extensions on student work visas, we additional 4.5 million new jobs will be are moving in the right direction. To added to the tech economy. truly capitalise on this opportunity, the momentum must be sustained. Accelerating advancement in new technology will certainly continue However, this is not a one-way street. to change the nature of work with As India steers towards becoming one whole new industries being created of the leading economies in the world, and old roles becoming obsolete its rapid growth in new tech comes at an increasing speed. Enabling with its own challenges. It must keep businesses to take advantage of pace with the transformation of its arising opportunities while also digital economy and find the right preparing the workforce to adapt to ways for bringing new skills and new these changes is one of the most types of company into its market. critical policy discussions facing According to KPMG, no less than 54 us today. per cent of all employees will require significant re-skilling and upskilling In this context, we need to ask RAPID ADVANCES IN by 2022 and approximately 60-65 ourselves: given that we are creating TECHNOLOGY ARE per cent of four million tech jobs are more jobs than we can fill, and the FUNDAMENTALLY expected to change over the next five shortage of talent increases, how CHANGING THE WAY WE years. India’s talent movement story can we futureproof our workforce? will have to shift from an exclusive Failure to address these challenges WORK AND LEARN, AND “India outbound” chapter to more in the short-term, as well as finding HOW WE CONNECT WITH of “India inbound,”. Enabling greater innovative solutions for the future, THE WORLD. mobility and opportunities for UK could leave the UK trailing behind our companies to set up in India will global peers in a rapidly expanding contribute to its quest for transforming digital economy. The inescapable short-term reality is, its economy. however, that the UK also needs more The UK-India Tech Partnership highly skilled talent in the next few I am proud that the techUK- is creating vast opportunities for years than we will be able to produce. NASSCOM UK-India Tech Alliance tech investment and incentives for Whilst many businesses are already is leading the conversation on talent businesses to embed their operations taking steps to address their digital and skills and we have made great in local markets. An undeniable by- skills needs, and the majority are strides in the right direction but there product of this is that companies are somewhat confident that they will be are still greater opportunities for not only investing heavily in digital able to hire the skills they need over further collaboration. As India’s Prime transformation but also enhancing the the next five years, most businesses Minister, Narendra Modi, once said, local supply of skills to achieve their are taking the same action by hiring “the UK and India are an unbeatable businesses’ objectives. overseas talent. combination.” Ties built in the past have grown stronger in the present Companies like Vodafone have Partnership with India – a growing and there are opportunities to make launched digital skills and jobs source of intellectual tech capital – these bonds even more robust in initiatives to train over five million is offering avenues to explore and the future. It is now time to build on people in India. Similarly, Indian address these short-term questions this positive momentum and get companies are now a leading force further. The country is expected to ready for a gear change in upskilling, in upskilling in the UK. To name but have a surplus of 1.3 million highly collaboration, co-innovation a few, , and TCS have skilled people in tech by 2030 and and co-creation. invested in coding academies, talent it now produces approximately four and innovation hubs and online skills million highly skilled graduates platforms respectfully. By enabling each year in specialisms that UK Julian David is the CEO of businesses to expand across the businesses need. I am delighted UK-India tech corridor, facilitating to see that the UK-India Tech techUK. collaboration and generating Partnership – through efforts

24 September 2019 NEWS IN BRIEF

Fintech, engineering solutions Tech deals dominate the and FMCG sectors in India and the UK saw a lot of action in India-UK equation the past month.

SBI launches mobile app UK protein brand Hyderabad's Cyient in in the UK enters India pact with UK science firm tate (SBI) has K-based sports and yderabad-based engineering launched its digital banking app nutrition brand Myprotein and technology solutions YONO in the UK, marking its has marked the entry company Cyient has signed Sglobal launch. Uinto India, with a strategic Han agreement QinetiQ’s Target partnership with MSM Retail Systems (QTS) to offer avionics SBI Chairman Rajnish Kumar Pvt Ltd. products for its unmanned target unveiled the app at an exclusive event systems. UK-based QinetiQ is a hosted in coordination with the UK The company established leading science and engineering India Business Council (UKIBC) in a warehouse with a robust company operating primarily in London on September 23. distribution network in place the defence, security and critical to provide quicker delivery infrastructure markets. Rajnish Kumar, Chairman, SBI, services, reducing the average said: "YONO SBI UK is one of the wait span for its customers from highlights of SBI's technological 25-30 days to three to five days. capabilities. I am delighted to launch YONO for our UK customers, after its ‘Myprotein’ was acquired by success in India.” British e-commerce company The Hut Group in 2011. The group operates over 100 international websites selling fast-moving consumer goods (FMCGs) directly to the consumers through its proprietary e-commerce "I am sure the easy-to-use features platform. and refreshing design will ensure that the app offers a positive customer Esha Singh, general manager, experience and showcases the bank's emerging makers, nutrition strong focus on digital banking.” and beauty brands, said: “India is a key market for Myprotein Under the agreement, Cyient will YONO SBI UK is described as an and demand for the products provide advanced manufacturing and enhanced mobile app which is has increased over the years, electronics engineering solutions "simple, intuitive, and user-friendly" for but due to limited availability, for the UK firm’s unmanned air, customers to carry out almost all their customers had to order products land, and sea target systems from banking needs. After the UK, the app from the UK which meant a its facilities in India, according to will begin being launched by SBI at its long delivery time. As a result, Anand Parameswaran, Senior Vice other operations worldwide. Myprotein now has an official President, Aerospace and Defence warehouse in Gurugram to at Cyient. Richard Heald, UKIBC Group deliver the same assurance of CEO, said: "It is exciting to see how quality and authenticity, which is Graham Brooks, Programme Manager passionate SBI is in its determination enjoyed by millions of worldwide, (India) of QinetiQ Target Systems, to deliver innovative technological to our customers quicker and we said in a statement: “Initial efforts products for its customers, particularly are determined to continue to are focused on the manufacture and here in the UK which has a large increase our investments in India assembly of avionics and electronics Indian diaspora." over the next few years." assemblies for our target systems.” www.indiaincgroup.com September 2019 25 GUEST COLUMN What’s ailing India’s solar rooftop ecosystem? by Andrew Hines

India’s solar rooftop sector reached a culminative capacity of 3.3GW last financial year. Andrew Hines, Co-founder of CleanMax Solar, India’s largest provider of solar power in the commercial and industrial segment, identifies areas India needs to address if it is to meet its target of 40GW of rooftop solar power by 2022.

n the past decade, renewable From a holistic perspective, rooftop of 40GW of rooftop solar by 2022, energy has emerged as a force solar power is among the most and there is still enormous potential to be reckoned with, providing advantageous forms of renewable for growth in untapped segments. Ipower that is not only clean but also energy, as it can generate cheap and increasingly cost-effective. Solar and clean electricity where it’s needed, The vast majority of the rooftop wind power have become steadily without the need for land or new capacity installed to date is in two cheaper, and are now more cost transmission infrastructure. Rooftop segments. One is government effective than coal, gas and other solar also creates jobs – far more buildings, where central and state forms of power generation in much per employment per kWh than fossil governments can take direct action to of the world. The case for renewable fuel power generation, and also more adopt solar themselves. The second energy in India is particularly than large-scale renewable projects. category, accounting for 70 per cent strong, as the country has relatively In fact, in the US, the rooftop solar of installations, is the commercial expensive electricity prices, and industry already far surpasses the and industrial (C&I) segment, and arguably the cheapest solar power in coal industry in terms of employment. particularly large, creditworthy or the world. An analysis by IRENA has cash-rich power consumers. The found that the cost of setting up solar As solar prices have fallen, the reason this segment has thrived is PV projects in India has dropped rooftop solar sector in India has grown very simple. These consumers pay by about 80 per cent, between the significantly. At the end of the last the highest electricity prices and have years 2010 to 2018. In the meantime, financial year, the cumulative installed the means to adopt rooftop solar in thermal power prices have risen capacity of rooftop solar reached order to achieve significant operating steadily, to the point that major 3.3GW, with rooftop installations cost savings. They can afford to either investors, lenders and insurers are growing by 66 per cent year-on-year, invest in the plants themselves or are becoming reluctant to invest in new with capacity additions to the tune of creditworthy enough to get into long- coal plants. 1.7GW within one year. That said, the term power purchase agreements country is still far from its stated target (PPAs) with solar developers.

26 September 2019 GUEST COLUMN loss protection” program, promoted by the government or perhaps a multilateral agency, would reduce the credit risk to these projects. This would allow MSMEs to enter into long-term, zero capex rooftop solar contracts. In addition to benefiting the environment, it would also bring down electricity costs for these companies, which are a significant impediment to industrial growth in India, and the associated employment.

Earlier this year, the government issued guidelines for the second phase of the grid-connected rooftop programme for achieving a cumulative capacity of 40GW rooftop capacity by 2022. The guidelines are a step in the right direction; for example, recognising the important role that utilities must play in the sector, and recommending they be incentivised to encourage projects rather than obstruct them. However, To accelerate the growth of rooftop new and creative approach to this the guidelines do not address the solar, the country needs to take a segment would likely be required. obstacles constraining growth in the two-pronged strategy. The first prong C&I segment, nor do they get at the is to sustain, rather than slow down, fundamental obstacles facing MSMEs the growth of the C&I segment. As A SUCCESSFUL POLICY and residential consumers. the sector has grown, utilities have WOULD NEED TO To truly nurture this industry, the begun to resist it, creating obstacles RECOGNISE THE SPECIFIC approach should be to create a to projects and pushing regulators for CONSTRAINTS OF EACH restrictions. The motivation to do so is national rooftop solar policy. Rather obvious – rooftop solar projects take SEGMENT – RESIDENTIAL than subsidising or mandating away their best customers. However, USERS, MSMES, LARGE installations, the approach should be the C&I segment is crucial to the CORPORATES, AND to create an enabling environment, continued growth of rooftop solar in OTHERS. with the objective of broad adoption India. Policymakers and regulators of rooftop solar by all categories must address the revenue concerns of consumers. of utilities, but not by curtailing rooftop A more addressable segment would solar projects or creating policy be MSMEs. The early adopters of A successful policy would need to uncertainty, which will directly lead to rooftop solar have been the C&I recognise the specific constraints a slowdown in consumers with financial means. of each segment – residential the sector. However, below this “cream” of users, MSMEs, large corporates, the C&I segment is a vast number and others – and take measures to The second way to encourage of companies which could benefit address them. Once those obstacles growth would be to create favourable financially but would find it difficult are removed, those companies and conditions in other segments. The to do so. They may not have the individuals will do what is in their residential segment has great financial means to invest in a project interest: to harness the cheap and potential in aggregate but is difficult with a long-term payback. At the same abundant energy of the sun, to the to promote. Individual rooftops are time, solar developers and banks will benefit of the entire country. very small, and individual consumers not make the investment unless they may be reluctant to make large are highly creditworthy. Andrew Hines is the co- investments, even if it’s in their long- founder of CleanMax Solar, term interest. This is why it currently To promote this segment, what is the largest provider of solar accounts for only 9 per cent of needed is not a subsidy, but someone power in the commercial and installations. To promote this segment to take on some of the credit risks of industrial segment in India. will require more than subsidies – a these projects. For example, a “first www.indiaincgroup.com September 2019 27 BIRD’S EYE VIEW India-UK maritime security: Convergences and opportunities by Rahul Roy-Chaudhury A strategic expert writes on how a transformative bilateral relationship between India and Britain will require greater convergence on maritime security.

Maritime Security its own strong bilateral trade, Convergences political and security links in With higher economic the Gulf, the Royal Navy now growth fuelled by greater has its first permanent naval energy consumption, India support facility in Bahrain, is dependent on the Indian opened in 2018, over 50 Ocean for both trade and years after its withdrawal ‘east energy. Over 90 per cent of of Suez’. This is in addition India’s foreign trade by volume to its Maritime Component and 70 per cent in value terms Command in Bahrain. Royal is seaborne, accounting for Navy ships operate in the approximately 40 per cent of region independently or under India’s GDP. In March 2015 multinational frameworks in Mauritius, Modi expressed such as the EU naval force a five-pronged vision for the Operation Atalanta for Indian Ocean, named Sagar counter-terrorism and counter- (Security and Growth for All in piracy operations. Since the Region) (meaning lake), 2001, the UK Maritime Trade including safeguarding India’s Operation (UKMTO) office territories and interests as well in Dubai has also provided as maintaining its role as a information to shipping and provider of ‘net security’ in the is a first point of contact in Indian Ocean. the event of piracy that is available to any flag. n post-Brexit UK, economic and foreign The Gulf region, moreover, policy seeks to be independent of the EU accounts for nearly two- The UK also maintains with the ambition for a ‘Global Britain’. As a thirds of India’s oil imports or sovereignty over the British Irising great economic power, India will become nearly 60 per cent of its total Indian Ocean Territory a key focus of the UK’s revised ‘prosperity oil demand. An estimated (Diego Garcia) in the Chagos agenda’, along with the US, Australia, Japan and 8.5 million expatriate Indians archipelago, with its joint New Zealand. But, India’s increasing strategic live and work in the Gulf, US/UK facility supporting influence also provides new opportunities for providing over $40 billion or regional operations, including engagement with the UK’s post-Brexit ‘security approximately 55 per cent of the prevention of human agenda’. Cooperation on maritime security, India’s total foreign exchange trafficking and countering especially in the Arabian Gulf region and the remittances annually. As narcotics and terrorism. western Indian Ocean, lies at the heart of such a result, the Indian navy While this is a controversial an agenda. regularly carries out ‘mission- political issue in India, its based deployments’ in the strategic dimensions for India, For too long, India-UK relations are perceived area, exercises bilaterally including the provision of UK through the prism of trade and investment, with Gulf navies and builds membership of the Indian alongside a recent focus on the British Indian cooperative bilateral defence Ocean Naval Symposium diaspora community. This neglects a key and security partnerships in (IONS) (alongside the UK’s component of India’s prime minister Narendra the region. dialogue partnership of the Modi’s ‘new India’, as a self-confident and Indian Ocean Rim Association assertive regional strategic player. The Indian It is not well known that (IORA)), cannot be ignored. Ocean has now become an essential part of 80 per cent of the UK’s India’s ‘immediate and extended neighbourhood’ natural gas imports, a key India-UK maritime security as well as a foreign and security-policy priority component of its energy cooperation currently emanating from its ‘neighbourhood first’ policy. security, pass through Indian comprises the annual Ocean sea lanes. To build on bilateral naval exercise

28 September 2019 BIRD’S EYE VIEW

THE INDIAN OCEAN HAS NOW BECOME AN ESSENTIAL PART OF INDIA’S ‘IMMEDIATE AND EXTENDED NEIGHBOURHOOD’ AS WELL AS A FOREIGN AND SECURITY-POLICY PRIORITY EMANATING FROM ITS ‘NEIGHBOURHOOD FIRST’ POLICY.

Konkan (its 14th edition taking place carrier Queen Elizabeth and its strike and safety. Recent bilateral political in the English Channel in August group in the Indian Ocean in 2021 consultation on Sri Lanka and the 2019); warship visits to each other’s provides such an opportunity. Both Maldives could be strengthened ports; the recent induction of two navies could cooperate bilaterally through mutual Commonwealth UK submarine rescue vessels into on specific anti-piracy patrols off the linkages. High-level naval-to-naval the Indian navy; the signing of the Gulf of Aden rather than separately bilateral meetings and visits should ‘white-shipping’ MoU; and prospective as is the current norm. Their unique be encouraged. UK participation in the recently privileged access to the strategically established Indian Information located Duqm port in the Sultanate Maritime Security Dialogue Fusion Centre for the Indian Ocean of Oman (where the UK opened its Amidst growing geo-strategic Region (IFC-IOR). Mutual high-level logistics support base in in 2018) competition in the Indian Ocean, visits continue; in March 2019, the provides significant joint opportunities, both India and the UK have further IISS hosted in London the first joint including exercising together in the opportunities for a convergence discussion session with the visiting area as well as multilaterally with the of interests. This can take place Indian Chief of Naval Staff and the UK US or/and other regional navies of the despite differing regional security First Sea Lord. Gulf. Indian naval access to the UK’s perceptions. There is therefore a Bahrain base would be useful. Naval need for a ‘track 1.5’ bilateral maritime Maritime Security Opportunities technology transfers and warship security dialogue that can help Yet, more needs to be done bilaterally building, focusing on aircraft carrier facilitate the sharing of emerging to enhance the safety and security of capability, could be enhanced, as strategic perspectives post-Brexit shipping in the Gulf and the western could maritime domain awareness and provide pragmatic policy-relevant Indian Ocean. To be most effective, to counter maritime terrorism and recommendations for furthering these policy initiatives need to be the joint pursuit of an international maritime security cooperation in the ‘deep and narrow’ rather than ‘shallow rules-based system, including the law Gulf and the western Indian Ocean. and broad’. The Konkan exercises, of the sea and freedom of navigation currently limited to one ship on each and overflight. Both countries could, side, needs to be expanded and along with select Gulf member states, Rahul Roy-Chaudhury Senior seek to enhance the effectiveness of made more complex; the maiden Fellow for South Asia (IISS). deployment of the new UK aircraft and coordination between the IONS and the IORA for maritime security www.indiaincgroup.com September 2019 29 HOTSPOT

Queensland: A smart investment decision by Gitesh Agarwal

Renowned for its excellence in a broad spectrum of sectors including agritech, biotech, education and renewable energy, Queensland’s innovative climate and geographical positioning make it an ideal bet for Indian investors, claims a trade expert. tretching across 1.7 million markets in China, Hong Kong, Korea, • Queensland has a diverse kilometres in Australia’s sunny Japan and Singapore all within just economy, with strong growth north, the state of Queensland two hours of Queensland’s time zone. in future-focused industries Sis looking to the future and embracing such as education and training, the opportunities of a changing global Queensland’s results speak for manufacturing, and professional economy. themselves: and scientific services. • Our rate of economic growth Queensland is finding new and better has consistently outperformed Why Queensland? ways to build on strengths such as the average of other advanced • Strong economy: Queensland resources and agriculture and making economies since the early 1990s. has a highly resilient and stable a global mark in forward-looking • The value of Queensland’s economy, underpinned by strong industries including renewables, goods and services exports has economic growth, with continued advanced manufacturing, and increased by more than 50 per growth forecast of just under 3 knowledge industries. It is ideally cent in the per cent per year over the next positioned to take advantage of last decade. three years. the flourishing economies of the • The GSP of the state is A$348 • Strategic location: Queensland Asia-Pacific which are creating billion (2017-18) and Exports were is ideally positioned as an extraordinary opportunities, with A$85 billion in 2019 (May). international gateway to the Asia-

30 September 2019 HOTSPOT

Pacific region, in close proximity increased levels of innovation and the state, thriving industries to some of the world’s strongest research and development within are connected to international growth markets. Its unique time business and industry. This has markets through world-class zone advantages and cultural been vital to support the growth infrastructure. connection with Asia and strong of existing, new and emerging • Interconnectivity: With six business relationships with industries, and is of increasing international airports and 191 America and Europe make it a importance in a global economy regional airports (including perfect location for international characterised by innovation and 56 certified airports), criss- investment. technological change. crossed by more than 177,000 • Business-friendly regulatory km of modern and efficient environment: The state’s legal road network, Queensland is framework is conducive to COMBINED WITH ITS connected to land transport business investment, by enforcing STRATEGIC ASIA-PACIFIC routes that play a crucial role in the regulation of contracts, loans, LOCATION, EFFICIENT moving freight to international banking, real estate and the PROCESSING AND markets. market, and by providing full RELIABLE SUPPLY • Highly skilled and multilingual protection of intellectual property workforce: Queensland has and patents. CHAINS, QUEENSLAND a multicultural, well-educated, • Competitive operating IS A WORLD LEADER IN resourceful and versatile environment: Queensland offers FOOD AND AGRIBUSINESS. workforce. Its enviable lifestyle, business owners and investors world-class education and many advantages, including one training institutes attract and of the lowest rates of payroll tax • Stable government and retain highly skilled workers. Its in Australia, competitive labour institutions: Queensland dynamic workforce is adaptable costs, low cost of living, simple presents a low sovereign risk, to change as new technologies, development approval and project with a stable government, a innovations and industries drive facilitation processes, and strong democratic society and well- structural shifts in the economy private-sector investment. established legal systems that and labour market. • Focus on innovation and operate under the rule of law. The research and development: state has sound finances and is MULTIPLE SECTORAL Queensland has been well positioned to further foster STRENGTHS recognised by the World Bank diversification, innovation and as a global innovation hotspot. skilled workforces. Mining, and mining equipment, Assisted by the Government’s • Infrastructure: Queensland technology and services Advance Queensland agenda, boasts robust supply chains Queensland is one of Australia’s the economy is experiencing and industry clusters. Across leading mining states with vast HOTSPOT

QUEENSLAND HAS A HIGHLY RESILIENT AND STABLE ECONOMY, UNDERPINNED BY STRONG ECONOMIC GROWTH, WITH CONTINUED GROWTH FORECAST OF JUST UNDER 3 PER CENT PER YEAR OVER THE NEXT THREE YEARS.

coal, gas, copper, zinc and other of tropical and subtropical livestock in water management, biomass mineral resource endowments, well- technologies and services that and waste mitigation, controlled established expertise and a proven include genetics, nutrition, pasture environment agriculture, renewable history of innovative exploration and management, food safety and fuels and carbon trading. mining practices. integrity, livestock tracing systems, environmental management, International education and Supported by over 800 high-quality specialist infrastructure and training mining equipment, technology and equipment, technical training and Queensland’s world-class education services (METS) companies, the animal health and welfare. Over 60 and training institutions, safe, state is a mining and resources countries import Queensland beef multicultural communities, idyllic investment proposition of choice. products. locations, and enviable lifestyle make it the location of choice for many It is the largest exporter of Agricultural technology international students. metallurgical coal in the world and its Queensland’s agtech sector is liquified natural gas (LNG) industry known for a variety of innovative Among its 10 universities, The is fast emerging as a global force in technologies including farm University of Queensland is one of production and export. equipment and management, the world's top 50 universities. The weather, seed optimisation, fertiliser state is also home to another three Food and agribusiness and crop inputs, remote sensing and of Australia's top 10 universities: Combined with its strategic Asia- agricultural big data. Queensland University of Technology, Pacific location, efficient processing Griffith University, and James Cook and reliable supply chains, It has internationally recognised University. BOND University is also Queensland is a world leader in research and development Australia's only Private University. food and agribusiness. Its clean capabilities at its major universities, environment, climatic diversity and with biotech research that New and emerging industries abundance of agricultural land make encompasses new industrial Queensland is taking the lead to it possible to generate high-quality, processes, new or improved crops invest, develop and incentivise, new fresh, clean and sustainably produced or foods and the development of and emerging industries that are meat, seafood, fruit and vegetables antibiotics, vaccines, genomics and already servicing the needs of our for export internationally. advanced imaging. changing world represent strong opportunities for investors. Meat and livestock Queensland’s cleantech sector also The region is a world-class provider features companies with expertise Investors keen on Queensland will HOTSPOT

initiate and submit proposals seeking exclusive commercial arrangements with the Queensland Government. Through the Queensland Government’s Market-Led Proposals Framework, the state has improved the efficiency of project decision-making and delivery by contracting exclusively with proponents rather than engaging in unnecessary competitive processes for services or infrastructures. d) Priority development areas provide opportunities for investment in a broad range of infrastructure projects, through the support of the Queensland find an advantage in the Queensland Plan to achieve a 50 per cent Government. In partnership Government’s Advance Queensland renewable energy target by 2030. with local councils, investors are (AQ) initiative, which is providing $755 As a result, Queensland is already able to streamline the planning, million in grants and incentives to help Australia's most popular renewable approval and development drive innovation and grasp tomorrow’s energy investment location, with processes for investment. opportunities. over 24 large-scale projects either e) State development areas are commencing construction or finalising clearly defined areas of land Under the program’s initiatives, commercial arrangements. established by the Coordinator- Queensland entrepreneurs, industry, General to promote economic universities and government agencies Queensland is also home to the development in Queensland. are collaborating to turn great ideas world's first utility-scale battery They typically take the form of into commercial products storage connected to a solar project one of the following: industrial and services. next to the electricity grid. hubs for large-scale, heavy industry; multi-user infrastructure Through AQ, the Government is The Queensland Government is corridors and major public creating 10-year roadmaps and committed to attracting international infrastructure sites. action plans across - Advanced investment and growing international f) The business migration manufacturing; Aerospace; Bio- trade: program - The Queensland futures; Biomedical; Defence; Mining a) Queensland released its first Government welcomes Equipment, technology and services; country-specific strategy, with successful business investors Screen Industry and Agriculture India being the first focus nation. who wish to invest and live there. & food. The strategy was released in Oct In partnership with the Australian 2018 by Hon Kate Jones, Minister Department of Home Affairs, Renewable energy for Innovation, Tourism and Queensland nominates business Queensland has an enviable capacity Commonwealth Games, migrants seeking to make an to produce renewable and alternative in Bangalore. investment that directly benefits energy, being rich in renewable b) The Queensland Government the state’s economy. Nominations energy resources and possessing is focused on providing Long- for business migrants are existing operations in large-scale term infrastructure planning and available through the Business solar, wind, biomass, geothermal and project pipelines. Queensland’s Innovation and Investment hydroelectric energy. With a strong State infrastructure Program. This is administered by agricultural sector and boasting an plan identifies investment Business and Skilled Migration average of 300 days of sunshine opportunities and gaps across Queensland (BSMQ). annually, Queensland has a solid a 15-year timeframe, to support platform to expand the renewable innovations and encourage energy sector and become a global private-sector investment Gitesh Agarwal is leader in the transition towards a and partnerships to deliver Commissioner – India clean-energy future. Queensland’s infrastructure at Trade & Investment needs. Queensland. The Queensland Government has c) Market-led proposals released the Powering Queensland allow the private sector to www.indiaincgroup.com September 2019 33 EXPERT VIEW The flexibility offered by e-learning holds many merits by John Ingram

An EdTech champion discusses the role online learning can play in upgrading India’s education system.

ver the past two decades, estimates that it will need some possibilities, including collaborative despite rapid economic three million new school teachers online international learning (COIL) growth and technological by 2030. Other challenges include where students connect virtually on Oadvancement, government and keeping girls in school (between courses with different countries, such investor interest, and the rise of 2006 and 2010, only 26 per cent of as the recent example of Cornell EdTech companies such as Byju’s, girls completed secondary education, University students in the US liaising India’s education system remains compared to 50 per cent of boys) and with students from two universities among the worst in the world. Despite the lack of PCs or tablets in schools. in China and one university in India enacting the Right to Education A in via online discussions and video 2009, which aimed to give every child conference to discuss sustainable in the country the right to a full-time THERE HAS ALSO BEEN food, energy and water policies elementary education “of satisfactory A STRONG GOVERNMENT around the world and propose and equitable quality”, India ranks 94th solutions to problems related to global out of 149 countries in the Legatum PUSH TO INTRODUCE NEW food and nutrition security. Despite Institute’s overall Prosperity Index ONLINE EDUCATIONAL the lack of connectivity in many of rankings and 104th in the TECHNOLOGIES, NOT India’s public schools at the moment, education category. LEAST BY THE “DIGITAL there have been efforts to extend INDIA” STRATEGY. access or build offline solutions, Half of India’s 1.3 billion population especially in rural areas. Private is under 25, and, with more than 260 sector schools, which account for million enrolments, it has the world’s Despite what may appear to be a quarter of the nation’s 1.5 million largest K-12 education system. Yet, a gloomy outlook, I’m optimistic schools, are also rapidly upgrading like many other countries around that methodologies such as online their digital and connectivity tools the world, India is facing a teacher learning can help modernise India’s and facilities. shortage in order to educate this education system and bring it into the vast, young population – UNESCO 21st century. There are in fact many There has also been a strong

34 September 2019 EXPERT VIEW pace. With some blended learning tools, entire courses are provided online in pre-prepared lessons, assessment materials and monitoring tools, greatly reducing time spent by teachers on course preparation, marking and reporting. Aside from blended learning models where entire courses are available online for students at home, models that use low-cost technologies such as tablets can even bring online learning experiences to children in the most challenging circumstances in India’s slums.

There is also a gap today between what students are taught in classrooms and what employers are demanding from prospective employees, a gap that is growing every day. The rate of change in technology has, and will continue to, government push to introduce new online classes. Bangalore-based outpace the change in curricula, so online educational technologies, not Unacademy, which operates an online the flexibility offered by online learning least by the “Digital India” strategy learning platform to help students is indispensable – allowing people led by Prime Minister Modi. In recent prepare for exams in India, recently to change their career paths and years, the government has rolled-out raised $50 million to further scale its learn new skills. Online learning can five major e-learning initiatives, each reach – showing the high demand sometimes be the only educational seeking to uphold the three principles that exists for online learning within option that can be fitted around busy outlined in the Education Policy of exam preparation alone. working lives. Digital India: access, equity, and quality. These are SWAYAM, which But it’s not just exam preparation India has a long tradition of face- lists over 1000 MOOCs; SWAYAM where online learning can help to-face learning; the teacher or Prabha, which offers 32 Direct-to- students. Increasingly, students can guru cannot simply be replaced by Home channels for transmitting take entire subjects online throughout technology. But the many benefits high-quality educational content; an academic school year. These can of online and blended learning the National Digital Library which be through virtual classrooms with methodologies can play a vital contains over 15 million books in fully trained online teachers – perhaps role in supporting teachers and more than 70 languages; the National to provide cover for temporary teacher students, and help India modernise Repository of Open Educational shortages at a school. Learning its education system. If parents, so Resources; and E-pathshala, a online like this can also be life- often the gatekeepers to a child’s bank of educational e-books and changing for a student who would educational opportunities, can be resources. Over the last three years, otherwise not be able to study a convinced of the merits of new, the government has committed over subject they have a passion for as digital systems of education, then £30 million to the projects. it was not covered by their school. it could set a new generation of Blended learning – which combines Indian students on a path towards On top of these government the best of classroom instruction and dramatically improved educational initiatives, students themselves are online learning – is another flexible, outcomes. leaning towards online learning as a popular methodology that recent preferential way of learning. A recent research has shown is driving the research survey by Gradeup, a growth of the online education market John Ingram is the CEO preparatory platform for competitive in India, the second largest market of of Pamoja Education, an exams, on over 10,000 students from its kind in the world after the US. education technology across India who were studying for competitive exams like JEE, NEET, Blended learning helps teachers as company based in Oxford, GATE, and SSC, found that 70 per it allows them to spend more time in UK, providing online cent of students who were preparing class giving individualised support to learning solutions for for exams offline would shift to online students, allowing slower and faster secondary education. if they were given access to live learners to move ahead at their own www.indiaincgroup.com September 2019 35 COUNTRY FOCUS Howdy Modi: Trump rolls out the red carpet, but follow-throughs will be crucial by India Inc. Staff

The Indian Prime Minister’s September 2019 US visit, which concludes with an address to the UN General Assembly, is historic in many ways but there is a lot of real groundwork required to build on it and create a win-win India-US trade and investment partnership.

he optics could not be any ahead of the US presidential race Modi, on the other hand, described better – a first-of-its-kind and next year. the US President as a “true friend” largest mass rally for a foreign in a deft diplomatic move to calm Tleader in the southern American state And, the election backdrop was hard brewing trade tensions after the US of Texas, with President Donald Trump to miss as Trump addressed the imposed tariffs on Indian steel seen hand-in-hand with the visiting crowd with: “You enrich our culture, and aluminium. Indian Prime Minister, Narendra you uphold our values, you uplift our Modi. Howdy Modi can be declared a communities and you are truly proud “His name is familiar to every person success on many counts, not least for to be American — and we are proud on the planet. He was a household Trump by virtue of the 50,000 largely to have you as Americans.” name and very popular even before Indian American crowds turning out he went on to occupy the highest

36 September 2019 COUNTRY FOCUS

office in this great country. From The bear hug and hand-holding were CEO to Commander-in-Chief, from all in place for an event billed as a boardrooms to the Oval Office, from HOWDY MODI CAN BE win-win for both leaders, as they were studios to global stage, he has left a DECLARED A SUCCESS expected to inch towards what had lasting impact everywhere,” noted the been categorised as a “mini” ON MANY COUNTS, NOT Indian Prime Minister in praise of trade deal. his host. LEAST FOR TRUMP BY VIRTUE OF THE 50,000 Trade pact Personal chemistry LARGELY INDIAN But the road to any India-US trade The dynamics between two of the AMERICAN CROWDS deal has never been smooth, most world’s most well-known political TURNING OUT AHEAD OF recently due to the tit-for-tat tariff war leaders were unmistakably on the THE US PRESIDENTIAL triggered by the Trump administration. right footing. There was no hint of Back in June, the US ended duty- some of an unpredictable Trump’s RACE NEXT YEAR. free access for about $5.7 billion previous barbs on India being worth of Indian exports under its unwilling to fully open up its markets Generalised System of Preferences to the US, as he declared: “India has The 2010 US census shows that (GSP) programme, designed to help never invested in the United States Texas is home to the fourth-largest developing countries that dates from like it is doing today...we're doing the Indian-American population in the the 1970s. India responded with same thing in India.” country after California, New York higher retaliatory tariffs on 28 US and New Jersey. Analysis of voting products, including almonds, apples Modi, on his part, reiterated Trump’s patterns shows the community and walnuts. own political slogan of “make tends overwhelmingly to support the America great again” and said the Democrat party and Trump would be However, a new kind of agreement event reflected the “heartbeat” of the understandably hopeful that his “true has been under discussion which great India-US partnership and a friend” tour with Modi would go some would lower some tariffs on US celebration of the world’s two way in changing those figures in his produce and restore preferential largest democracies. favour for the future. treatment for some Indian exports to the US. www.indiaincgroup.com September 2019 37 COUNTRY FOCUS

THE DYNAMICS BETWEEN TWO OF THE WORLD’S MOST WELL-KNOWN POLITICAL LEADERS WERE UNMISTAKABLY ON THE RIGHT FOOTING.

“We've been talking to the Americans, Bilateral US trade with India, at $142 credentials as a world leader keen we have engaged them for many billion last year, is just a fraction of the to tackle some of the toughest crises months now. My expectation is $737 billion in US-China trade, which faced by the global population, that some of the sharper edges, has often been flagged as a huge setting India on a leadership footing they would be addressed in some area of potential as ties between the on complex issues such as climate forms in the not too distant future," US and China get more and more change. The symbolism of his gift Indian external affairs minister, S. strained. of the $1-million Gandhi Solar Park Jaishankar, told reporters recently. to the UN will not be lost, with the Diplomatic triumph 193 solar panels of the 50kwh roof- Trump has made no secret of his But whichever way things go on top solar park each representing a resentment of India's high tariff rates, the mini or not-so-mini trade deal, member of the multilateral body. including a 50 per cent tariff on Modi’s visit to the US will be hailed a Harley Davidson motorcycles. He diplomatic triumph on just the sheer At the end of the high-profile visit, is also unhappy with India's new numbers he attracted to the Howdy all eyes will once again revert to the investment rules on e-commerce that Modi event at the start of a week-long bigger picture to see how the US limit how companies like Amazon tour ending with his address to the and India build on the undoubtedly and Walmart-backed can do United Nations General Assembly. successful tour to convert into business in a rapidly growing online deliverables for a true partnership on market set to touch $200 billion His address to the UN Climate Action the ground across all sectors. by 2027. Summit once again established his

38 September 2019 NEWS IN BRIEF

From entertainment to tech, European and Asian firms India remains an attractive eye India expansion market for overseas investors.

Paris-based Believe Investment app Lebanon’s geo-tech firm buys Entco for India raises $21.4mn acquires two Indian expansion companies

rench technology and artist angalore-based start- ebanon-headquartered services company Believe has up Groww said it has Advanced Construction acquired Entco, an Indian live raised $21.4 million in Technology Services, a Fmusic production company, and Ba Series B financing round Lgeotechnical engineering, materials will now offer its roster of artists that was led by US-based VC testing and consulting firm, has more comprehensive services and firm Ribbit Capital. Existing acquired 51 per cent stake in revenue opportunities in one of the investors Sequoia India and Y Pune-based CQRA and Durocrete world’s fastest-growing music and Combinator also participated in Engineering Services for an entertainment markets. the round. undisclosed amount.

The two-year-old start-up users to invest in mutual funds, including systematic investment planning (SIP) and equity- linked savings. The app, which maintains a very simplified user interface to make it easier for its largely millennial customer base Khaled Awad, Chairman, ACTS, said to comprehend the investment that the demand for testing the quality world, offers every fund that is of bridges, roads and infrastructure Entco will be rebranded as Believe currently available in India. being built in India is increasing at a Entertainment, to be based in tremendous pace and the company Mumbai, where it will closely align Lalit Keshre, Co-founder and would bring its overseas expertise live music experiences for brands and CEO of Groww, said the market to India. consumers with Believe’s growing of mutual funds is increasingly music distribution, label services widening in India and the start- He said: “We would be investing and artist services operations in the up is hoping to accelerate its about $10 million over the next three market. growth with the fresh capital. years, besides sharing our knowledge Additionally, he plans to double with the Indian company. As per the Denis Ladegaillerie, CEO, Believe, Groww’s headcount to 200 in latest study, there are about 163,000 said: “We have been growing quickly the coming months. bridges in India that need to be tested to a leadership position in the Indian for their longevity.” market, and with Entco’s expertise, Groww has amassed about Believe will have unparalleled 2.5 million registered users, Currently, CQRA and Durocrete work ability to help creators in India build two-thirds of whom are first- with leading infrastructure companies audiences, careers and revenue time investors, Keshre said. such as L&T, Hyderabad Metro, opportunities.” Groww is currently free to Reliance Group, Godrej Properties use and does not charge any and Tata Housing to test the quality Subramanian Iyer, Co-founder and commission on transactions. of material and strengthen Managing Director, Entco, said: “This The start-up eventually plans to the construction. strategic move will bring our artists offer a paid service as it looks and brands unprecedented access to to monetise its user base. It The tie-up will also bring in a geo- the expertise and scale of Believe’s will also soon begin to offer the investigative team from ACTS to 44 global offices and more than 1,000 ability to purchase from investigate the condition of the soil professionals.” its eponymous app. before a project is executed. www.indiaincgroup.com September 2019 39 40 September 2019 REGION FOCUS No slowdown in Tamil Nadu as foreign investments pour in by India Inc. Staff

t a time when foreign know more about our offerings for investment in India has slowed investment." down to a decade low, the Asouthernmost state of Tamil Nadu The MoUs include DP World’s grabbed headlines last week when interest to invest Rs 10 billion ($140 it secured investments worth Rs 42 million) to set up a Free Trade billion ($591 million) from UAE-based Warehousing Zone that will employ corporates. more than 1,000 skilled manpower. It also includes ITEC ME’s decision At the end of his three-nation tour to establish a multi-trade export Tamil Nadu’s buzzworthy that included the UK and the US, facilitation from the state to promote MoUs with UAE investors the state chief minister struck gold small and medium enterprises in the middle eastern nation where (SMEs), and another MoU to facilitate might just be the kickstart six memorandums of undertaking placement of skilled manpower. This needed to counter the (MoU) were signed across sectors is expected to generate employment slowdown of FDI in India. like warehousing and logistics, opportunities for another healthcare, mobility, skill development 1,000 people. and agriculture. Giant Industries has also signed an "This visit is to seek tangible MoU for a biodiesel project that will investment for Tamil Nadu that is engage farmers in the state while mutually rewarding for both the state Mulk Holdings signed an MoU worth and the investors,” said Edappadi Rs 5 billion ($70 million) for setting K. Palaniswami, chief minister of up industries that will generate Tamil Nadu. “I am happy that the employment of about 500 skilled business community in the UAE and manpower. An MoU worth Rs 1.5 the investors here are very keen to billion ($21 million) was signed by www.indiaincgroup.com September 2019 41 REGION FOCUS Pro-Global Logistics for supply chain has also slowed down significantly. In Between 2011-12 and 2018-19, the logistics in Agri produce. fiscal 2019, there was a 1.1 per cent state’s Gross Domestic Product decline in FDI inflow in the country at (GSDP) expanded at a Compound In the healthcare sector, Prime $44,366 million. It was the first annual Annual Growth Rate (CAGR) of 11.46 Medical Centre signed an MoU decline since 2012-13. Total foreign per cent to Rs 16.06 trillion ($222.58 aimed at generating employment investments in the country declined billion) while the Net Domestic directly and indirectly for thousands 42.6 per cent last fiscal on the back Product (NSDP) expanded at a CAGR and Mauto Electric Mobility signed a of an even steeper decline in foreign of 11.45 per cent to Rs 14.41 trillion contract to invest Rs 1 billion portfolio investments in the country. ($199.69 billion). ($14 million). “If one goes by the growth rate of As one of the most industrialised the state since 2016-17, it seems to states in the country, Tamil Nadu has be absolutely immune to the macro- been actively scouting for additional economic shock that the country’s foreign investments, something economy has faced in the light of that it has been quite successful demonetisation in November 2016 at in the past. The trip to UAE was and the implementation of the Goods preceded by 16 companies from the and Services Tax in July 2017,” said US committing to invest Rs 2,780 N.R., Bhanumurthy, a professor at crore ($391 million) in the state to National Institute of Public Finance generate employment for 20,000 and Policy, New Delhi. “In the last people. Overall, the 14-day three- couple of years, there were concerns nation tour yielded 41 memorandums about industry and the State of understanding worth a total government’s fiscal situation, apart investment commitment of Rs 8,835 from political uncertainty. Despite all crore ($1.24 billion) that is expected to these factors, the fact that the State generate employment opportunities has been doing well on the economic for 35,520 people in the state. front suggests that its economy "Facts and figures speak for itself for is resilient.” Tamil Nadu. Frost and Sullivan has ranked Tamil Nadu the second in their There is a caveat though. Like in the overall ranking and first in investment case of any investors’ summit where potential among other Indian states,” a lot is promised but not everything Palaniswami said. is delivered, the MoUs ought to be taken with a pinch of salt. Not all the “We have the second largest investments promised in the state’s economy in India among the states investors summit in the past have with a GDP of $250 billion. Between fructified either, a point that its main April 2000 and March 2019, we have TAMIL NADU’S ENVIABLE opposition party DMK has been quick attracted FDI worth $29.848 billion, GROWTH RECORD AND to point out. In the global investors which makes us the fourth largest FDI ABILITY TO MANAGE meet organised in January earlier destination region in the country,” said CRISIS MAKES IT this year, 304 MoUs were signed with K. Shanmugam, chief secretary of the ATTRACTIVE FOR ANY committed investments of nearly state. "We have taken up a series of INVESTOR. $43 billion. measures to simplify and rationalise the regulatory processes (registration “Have Rs 5.42-lakh crore (proposed) and inspection processes) by investments in the two editions deploying information technology Tamil Nadu’s enviable growth record of GIM been realised? Not at all. to make governance simpler, and ability to manage crisis also The announcements regarding responsive, transparent, accountable makes it attractive for any investor. investments have become a mere and efficient." Despite a 24 per cent deficit in North mirage,” said M.K. Stalin, East monsoon which gives the state president, DMK. The investments come at a critical 50 per cent of its annual average time for the country in general and the rainfall and the ill effects of the Perhaps Tamil Nadu can take the state in particular. India’s economy cyclone Gaja in November last year, lead and break the illusion that most that was at one time the fastest the state’s economy grew at a healthy MoUs are merely paper investments. growing in the world, has slowed 8.17 per cent that was well above the That would be the fitting response for down to 5 per cent in the first quarter national average of 6.81 per cent in critics and set a template for others of fiscal 2020, the slowest in 6 years. 2018-19. to match. The rate of flow of FDI in the country

42 September 2019 SUBSCRIBE NOW AT indiaincgroup.com

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India’s talented workforce will play a key role in improving business solutions

Pratap Sarker, President, Global Commercial Solutions, Conduent – a US-headquartered tech-led business process services firm – talks ‘India Global Business’ through the organisation’s work in smart solutions, current tech trends and the role his Indian heritage plays in his work life.

hat are some of the settlement, faster than ever before Nordea would allow a trade finance cutting-edge tech is gaining traction with Straight- transaction, backed by a blockchain solutions being Through Processing and Real-Time solution, to be initiated directly off Wembraced by companies Payments. The underlying technology their website, eliminating all the worldwide? uses universally understood paper processing that the transaction message formats so that banks can required? R3 is creating meaningful Companies around the globe communicate with each other and ecosystems for this industry that are embracing automation, settle both high-value and low-value are region-specific but can then machine learning and blockchain payments instantaneously. The eventually interoperate with technologies, and turning to technology opens up a plethora of each other. Conduent to elevate their constituent uses in both retail and B2B settings. interactions and deliver advanced A few other production-grade How do you see the role being digital experiences that are networks worth mentioning are those played by a country like India, individualised, immediate and powered by Ripple and IBM’s foray known for its software expertise? intelligent. Conduent is helping via World Wire, built on Stellar. We with this transformation in all the are certainly moving towards a world India’s diverse and talented industries we participate in. For where there will be multiple options workforce will play a key role this response, however, I’ll focus for businesses and consumers alike in the advancement of these on companies in the financial to send and receive money faster. business solutions. In fact, today for industry who are adopting innovative Conduent, almost half of our global solutions in the areas of payments Similarly, trade finance continues to technology workforce is based out and trade finance. be a largely paper-based process. of India. Our team of experts is There are many different verticals developing solutions based on the Payment processing has long been within the trade finance domain, latest technologies for mobile and an area that has lagged behind the but the open account market is the IoT, human-computer interaction, world’s move to true digitisation; one area that is embracing cutting- machine learning, text and so, creating the ability to move edge technology solutions. Who multimedia analytics. payments, from initiation to final could have believed that banks like

44 September 2019 GLOBAL INDIAN

Our India operation is among the lab to the marketplace. for managing (1) the rules that company’s three largest outside govern process orchestration and of the United States. The skilled Every business service Conduent data standardisation and (2) the technology workforce that India provides – from robotic process technology stack that is required has to offer is a key element in automation for financial organisations for blockchain-powered networks. Conduent’s overall growth strategy to patient-centric data analytics for As more and more banks move to and forms an integral part of our health providers – is centred on blockchain technology, initiatives technology agenda. Our talented innovation based on leading-edge such as DTCC’s Trade Information workforce is at the centre of our technologies of this nature. Warehouse, and IOI Capital and Accushoring philosophy where we Markets prove the viability of the perform work in locations where we How has blockchain transformed technology and hence, the traditional can deliver the greatest value – from the business processing scenario? capital markets’ back office function a talent standpoint. will undergo dramatic change. With many Business Process We have also invested in global Outsourcing (BPO) services, What is the big tech idea/concept innovation teams based out of the there is a significant challenge of that excites you the most? United States and India. Bangalore, connecting businesses processes India is home to one of our two across siloed organisations with the In this digital transformation era, we global innovation centres – where right level of security, access and have many cutting-edge technologies we work on Automation, Analytics, transparency. Blockchain technology that are being embraced by Blockchain, IoT, Mobility and is uniquely able to function in such companies across industries. The top Customer Experience solutions. scenarios by securely providing ones, in my opinion, are automation, We have invested in cutting-edge the right information to the right analytics, machine learning and infrastructure for Artificial Intelligence parties at the right time, resulting in blockchain, and these technologies (AI) and Machine Learning (ML). Our exceptional efficiencies. As such, I are impacting businesses in their scientists and engineers work closely envision a future state wherein the own way. with Conduent businesses and BPO service industry will continue customers to enable the successful to exist, but its role will be materially What particularly excites me is the application of technologies from the changed. It will be responsible convergence of two or more of these www.indiaincgroup.com September 2019 45 GLOBAL INDIAN lives of Conduent’s offerings?

As one of the largest business process companies in the world, we manage mission-critical interactions at a massive scale. Every day, our clients count on us to deliver exceptional experiences for the patients, consumers, employees, travellers or the citizens they serve.

For example, our Healthy Communities Institute (HCI) platform analyses data across numerous demographic and healthcare dimensions to help state and local health agencies identify at-risk communities and citizens and improve the distribution and quality of care. One of our clients used the data to determine that mental health, care coordination, health literacy and place-based care were the biggest priority areas in their community. The insight helped the client make decisions about where they should focus their time and efforts, implement strategies that made a difference and empower organisations within their network to facilitate change.

There are many more examples like this across the twenty industries that Conduent services – from healthcare and medical claims management to human resource services and government solutions.

How does being a Global Indian influence your decisions (professionally and personally)? technologies; the business outcomes core capabilities of automation and from such integrated solutions are machine learning based analytics, Having been raised in India, I was simply astounding. we can create smart solutions to taught at an early age of the value augment and enhance human work. of education, honesty and hard For example, our next generation Such integrated smart solutions work. These values, combined with patient assistance platform help clients automate document the tenets of entrepreneurship, introduces efficiencies through the classification and significantly drive excellence and continuous innovation latest technologies in blockchain for contract compliance by assessing that I have imbibed over the last 20 provider credentialing and couples the real risks inherent in contracts, years in the US, have shaped the that with automation and machine proactively identifying contractual approaches I take on both personal learning results in order to determine and counterparty risk, maintain and professional levels. They have the “next best action” to the agent compliance with contractual influenced and continue to have based on the patient’s history, and relationships and quickly respond to an impact on my deep passion thereby providing a personalised regulatory demands. for learning, informed decision experience. making, diligent work ethic and How would you explain some of transformational leadership style. Similarly, when we bring together the the tangible impacts on people’s

46 September 2019 NEWS IN BRIEF

Tech and digital solutions Indian companies venture enterprises remain the frontrunners in global down South expansion.

Wipro to collaborate Cloud computing firm Zensar expands with Brazil’s financial Zoho eyes Australia operations in Cape services body Town, South Africa

ipro plans to develop an oftware company Zoho has ensar, a leading digital online platform, Noomis, invested $15 million to open solutions and technology for the financial services two onshore data centres services company that Windustry in Brazil. The Bengaluru- Sin Sydney and Melbourne. Zspecialises in partnering with based software services provider has Zoho's chief strategy officer Vijay organisations across industries on tied up with Febraban, an industry Sundaram believes Australia and their digital transformation journey, body representing the Latin American New Zealand are key growth announced a new larger office in country’s financial services industry. markets for the cloud software Cape Town, South Africa. computing company.

The Indian multinational previously catered to the Australian and New Zealand market through offshore data centres, but the local expansion is the company's first step in setting up this type of infrastructure in the region.

The company, which services Sandeep Kishore, CEO and MD, Febraban also organises CIAB, an clients such as Qantas, BHP Zensar said: "South Africa is a information technology trade show for and Netflix, has a customer base critical region for us and we hope financial services in Latin America. in the ‘‘tens of thousands’’ in to collaborate more closely with our Noomis will serve as a meeting point Australia and New Zealand. key customers based in and around and a discussion platform for the Cape Town from here. We have finance professionals in Brazil who Part of Zoho’s rationale for been focused on expanding to meet participate in CIAB FEBRABAN. opening these centres is to be our customers' needs and investing able to compete for government in Cape Town to add to our global Built with digital cloud technologies, clients, which are subject to business." the platform is envisaged to change more stringent rules when they the way companies collaborate and outsource or offshore data, The new office can seat many more share information. Noomis will provide as well private companies like people with interactive spaces to reliable, analytical, and unbiased consulting companies which do encourage collaboration as well as information via news reports, biogs, government work. serve as the centre for the Skills videos, and newsletters that will Development Program initiatives in enable participants to stay up to date Zoho has a broad software Cape Town. Interns in Cape Town on financial market trends. offering and counts American will be trained in cutting edge IT company Salesforce and ASX- technology such as Cloud computing, Wipro said the project development listed HR-based software Robotics, etc., which are the skills would include design and delivery company ELMO, as well as needed by our customers and the of the first phase of the online Microsoft Office Suite and Google local market today. Additionally, the platform. The company would also be Suite among its competitors. selected candidates will also be responsible for creation of workflows trained in soft-skills to make them and the editorial publisher module for job-ready. content management in the platform. www.indiaincgroup.com September 2019 47 INTERVIEW

There is a high demand for Indian organic food products In this interview with ‘India Global Business’, Rohan Grover, Director of Nature Bio Foods, discusses India’s thriving position in the global organic produce arena in a time when healthy, sustainable living seems to be the mantra.

s the Indian organic sector collection. The sector is booming, the by our more than 60,000 farming making its global presence felt? global demand for Indian organic food families. With the continuing demand, products is on a constant increase. it wouldn’t be unfair to foresee days I The country is exporting tonnes when the Indian organic industry The Indian organic food industry of organic oils seeds, cereals and is ruling. is growing at a tremendous rate. millets, sugar, fruit juice concentrates, The country exported organic food tea, spices, pulses, dry fruits, Is a lead in the ingredient space products worth more than $500 medicinal plant products etc. every important for future-proofing million in the year 2017-2018, up by year. The domestic market might be growth in the industry? 39 per cent from the previous year. at a nascent stage, but India makes Considering the current market for one of the biggest suppliers of Definitely. For years to come, it will size, yes, the growth is humongous. organic to the markets in the world. play a vital role. The increasing The nation supports more than 10 The Indian organic rice ranks second numbers and the growing demand million organic farmers – making us when it comes to exports to Europe. for organic food is what will drive the largest in the world. Surely that’s Nature Bio Foods comprises 59 per our businesses too. Our leadership a number the globe cannot ignore. cent of the total organic basmati and exponential growth aren’t only Today, we are counted among the and 77 per cent of the total organic about numbers. A lot that goes top 10 countries with maximum non-basmati rice exports to the world. behind achieving these numbers. organic land, ranking third in the wild And all of this has been supported Consistency in quality, organic

48 September 2019 INTERVIEW

OUR CULTIVATION PRACTICES BACKED BY A UNIQUE BUSINESS MODEL, INFRASTRUCTURE AND AN ALL-ORGANIC SUSTAINABLE SUPPLY CHAIN HAVE MADE US THE PIONEERS. traceability, all-organic integrated cultivation practices backed by a factor in. Monsoons have shifted and supply chain and sustainable unique business model, infrastructure so have the sowing seasons. None business goals – combined are and an all-organic sustainable supply have been spared. Some areas reaping the benefits. Due to this, chain have made us the pioneers. haven’t had decent rainfall in a we have been able to make our long time. presence worldwide and through which we have learnt a lot. This has Modern times require climate-smart led us to aim for world-class quality techniques. We (Nature Bio Foods) benchmarks and here we are. The started with Land Laser Levelling numbers had huge calculations this year. The technique reduces the and formulas behind them. These amount of water used for irrigation numbers will surely push us in the and improves crop uniformity and future but the formulas are the ones growth, thereby increasing yield. which will sustain us. We (Nature Bio Foods) started with rice as our main Like any other food company, the ingredient back in 1993 when the first challenge is the same – maintaining seed was sown. Year by year, the product quality and timely deliveries. passion has only been seen rising. We have now added new varieties. What are the key global expansion Our portfolio has expanded, from markets for this sector going basmati rice to the addition of more forward; is India well-equipped to grains and cereals, millets, oil and oil compete with the best? seeds, flour, lentils and pulses etc. We (Nature Bio Foods) lead with the Undoubtedly, the US and Europe highest number of farming families have been major markets for Indian associated with us; they count up to origin organic exports. North America 60,000 and 80,000 Ha organic land. constituting for more than 60 per cent of exports made from the sub- What sets certain Indian products continent. While others are still apart in the global arena and why? What are the challenges faced in gaining momentum, more and more terms of organic farming in India regions in the Asia & Pacific region When it comes to agriculture, there and maintaining a robust global are moving towards this change. is nothing better that comes to supply chain? one’s mind than India. We belong It’s the product categories which have to a country where 70 per cent of The path hasn’t been easy for us. been expanded wonderfully. While our population had businesses We started when the wave of green to the layman organic cereals and dependent on agriculture. Indians revolution had hit Indian farmers. grains and fruits and vegetables have have been practising farming since Since then, the toughest challenge been major concerns, the industry time immemorial. We have one of the has been convincing the farmer to has come up with the likes of rice largest organic lands with the world’s not only adopt but also continue syrup and rice protein as well. Dairy largest number of organic producers. practising organic farming in a products are largely getting replaced manner where organic traceability by plant-based organic milk like rice The Indian subcontinent is bestowed can be maintained at every step. The milk and almond milk. The demand with a lot of potential to produce compliances are the other part of this has been growing owing to increasing varieties of organic products due traceability which need to be ensured. dietary shifts and trend moving to its various agro-climatic regions. towards plant-based lifestyles. In several parts of the country, the Another thing being the geographic inherited tradition of organic farming location of these farms. They are Exports of oil cakes of various seeds is an added advantage. This holds sparsely located and hence their like soy, mustard, sunflower etc. too promise for the organic producers to management can be a little tricky have increased over time. Apart from tap into a segment which is growing in at times. these, plant-based herbal root powder the domestic and export market. and leaves are also shifting towards The company (Nature Bio Foods) is Additionally, there’s climate change the major categories. practising 100 per cent organic. Our and the dependency on rainfall to www.indiaincgroup.com September 2019 49 M A K I N G I N I N D I A F O R T H E W O R L D

Kalyani Group is a 2.5 billion USD multinational with high technology, engineering and manufacturing capability across critical sectors such as Defence and Aerospace, Engineering Steel, Automotive, Industrial, Urban Infrastructure and Specialty Chemicals. The Group has been a flag bearer of ‘Make in India’ across sectors including Defence and Aerospace.

E X P A N D I N G H O R I Z O N S DEFENCE

Kalyani Group ( Limited), Mundhwa, Pune - 411 036, India, Tel: +91-20-67042777, 50 September 2019 EXTRACTS Leveraging the UK’s Deep-rooted Indian Diaspora The founder of UK-based media house Asian Business Publications Limited (ABPL) catalogues the role played by Indians in Britain over the course of history and elaborates on how the shared history can be used to foster deeper India-UK ties in the future.

he Indian diaspora the armed forces of the two in the UK and the countries. During WWI and Indian overseas WWII the Indian soldiers Tcommunity is the and officers who were culmination of several brought to the UK were more waves of migration or less discouraged from spanning centuries, settling in the UK, the land and it is important, for which they laid down across generations, to their lives. But that was the acknowledge and revisit imperial period. After the our country’s migration independence of India and history. Pakistan, migration to Britain became more popular The role of the Indian especially from Pakistan diaspora in the context and particularly from Mirpur of the UK’s multicultural district—from the part of policies will largely Kashmir occupied depend upon its collective by Pakistan. strength in the UK and its connectivity with India. In 1947, there were, perhaps, less than 5,000 people As India’s economy settled in the UK from transforms, her political, India. But by 1962-63 the military and cultural number rose to hundreds powers are also bound resulted not only in the peaceful of thousands. Then the to rise, elevating her to a twenty- departure of the British from India but arrivals came from East Africa. In first century superpower. It is only also helped in continuation of ties with the early 1960s, the largest number inevitable that her foreign and the UK. of overseas Indians, mainly Gujarati economic policies are becoming settlements, were in East Africa increasingly outward-looking and (Kenya, Uganda and Tanganyika). her search for new global partners THE ROLE OF THE During 1976, Indians from Zimbabwe, is gathering momentum. And this Zambia and Mozambique made a provides a great opportunity for the INDIAN DIASPORA IN beeline to the UK. Some also came UK, probably more so in view of the THE CONTEXT OF THE from Aden. It is interesting to observe Brexit verdict. UK’S MULTICULTURAL the composition of British Indians. POLICIES WILL LARGELY The largest number was from Gujarati Education and the professions DEPEND UPON ITS and Punjabi (Sikh) stock. There were Over the years, more and more others from other parts of India who Indians came to the UK from India COLLECTIVE STRENGTH came as doctors, teachers and for Indian Civil Service and careers IN THE UK AND ITS other professionals. in law and medicine. Most of the CONNECTIVITY WITH leaders of the Indian Independence INDIA. Leveraging the Indian diaspora Movement—Mahatma Gandhi, Of all the immigrants to the UK in the Jawaharlal Nehru, Sardar Patel and last fifty years or so, Indians have MA Jinnah, to name a few—were done exceptionally well in education, trained as barristers in London. These War Effort and the Indians as professionals, in business, leaders were deeply influenced by the in Britain commerce, arts, culture liberal education they had received Participation of a large number of and academics. in the UK. The non-violent nature of Indian soldiers in the two World Wars the Indian Independence Movement also created a special bond between In the foreseeable future, the Indo- www.indiaincgroup.com September 2019 51 EXTRACTS

winning-partnership.com

British economic partnership has worth remembering that Indians have tradition and values. enormous scope for development. an upper hand in certain sectors of They have different and modern economy. And this is just the While the British government has not complementary skills. Britain needs beginning. Unfortunately, centuries of yet fully recognised the potential of entrepreneurs and skilled personnel, subjugation does have an impact on this small yet talented mass of Indian while India could do with British the psyche and temperament of diaspora, I fear the Indian government expertise in international finance and the populace. too has not yet developed strategies infrastructure project management. and structures to sustain the links There are many other areas of We must also accept that not all of with the upcoming generation of mutual cooperation. the legacy of the British Empire is on overseas Indians. The younger Indian the negative side. English language, diaspora in modern-day Britain needs It is worthwhile to remember that the rule of law, independence of to be encouraged to enjoy the best of in the beginning of the seventeenth judiciary, freedom of press and both worlds—i.e. to look at their roots century, India was much more certain other Western values did India and retain whatever is worthwhile advanced than the UK. Up until a world of good, combined with its and pick up the best from the British 1842, India and China were far more own tradition and cultural heritage. society too. That is true integration. ahead than Europe or even the USA Given this history and success, just in terms of international economic No one could have foreseen that perhaps, there may be lessons to be performance. at the beginning of the twenty-first shared in the story of British Indians century there would be over 1.5 for other immigrant communities too. What has been achieved between million residents of Indian heritage in As the UK government grapples with 1947 and 2016 is an eye-opener. the UK. growing concerns over migration, In the last sixty-nine years, in spite and as India flexes its muscles on the of all the challenges, both man- Compared to their other British peers, world stage, the history, experience made and natural, India has almost British Indians are way ahead in and talents of British Indians, should succeeded in putting its house in education, entrepreneurship, savings be much better utilised. order. The prediction that India would and several other aspects of life. The disintegrate or won’t be able to younger generation born and brought manage itself has been proved wrong. up in the UK with higher education CB Patel is the founder of Not only has India remained a united and qualifications, combined with the Asian Business Publications country (of the size of a subcontinent) traditional values, is forging ahead. Limited (ABPL), the UK-based but has also remained democratic Look at their numbers in prisons—just media house behind Asian and secular in spite of the painful a minuscule percentage. Similarly, Voice and Gujarat Samachar legacy of several centuries of foreign British Indians are respected for their news weeklies and the Asian domination. While the average Indian peaceful and non-violent nature. Achievers Awards. is moving up the scale economically, Why is the younger generation of Indian MNCs have invested billions British Indians faring better in every The above is a synopsis of one of the of pounds in commerce and industry walk of life? In large part, this must chapters from ‘Winning Partnership: India-UK in the UK and other countries. It is have something to do with the Indian Relations Beyond Brexit’, edited by India Inc. Founder & CEO Manoj Ladwa.

52 September 2019 Catch the opportunity

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www.indiaincgroup.com September 2019 53 SOCIAL IMPACT FOCUS Building impactful India-Scotland connections by Jess Kemp A senior executive at Social Enterprise Academy shares how the organisation is supporting leaders in India to make a difference.

December 2017. The first Venkatesan, Co-Founders learning and development of Khwaab Welfare Trust – a programmes they have social enterprise based in delivered have been through Delhi – were two of the first Scotland: India Impact Link Impact Link Fellows. – a support package for emerging social enterprises. Khwaab financially empowers The support package offered low-income community to five Fellows includes a women by imparting livelihood leadership development skills. The social enterprise programme, social enterprise looks for avenues where mentoring by a social women can market their entrepreneur in Scotland, and products and add to their funding support for growth. household income, which can then be directed towards their As a collaboration between child’s education and family’s the Scottish Government, welfare. MITRA and Social Enterprise Academy India, Impact Shruti Venkatesan, Co- Link was created to build Founder of Khwaab explains the resilience, capacity the impact that access to and impact of India’s social learning and development here are currently up to 2 million social enterprises that are moving has had on her organisation: enterprises operating across India. That’s beyond the incubator stages “If an entrepreneur is able to 2 million changemakers stepping up, of growth. develop his or her leadership Ttaking action and starting businesses that solve abilities, then he or she will the social and environmental issues that matter Impact Link also forms part be able to overcome any kind to them. of the Scottish Government’s of leadership challenges that Internationalising Social come while managing their However, people growing social enterprises Enterprise Strategy and India social enterprise. A real ‘aha’ often don’t know what they need to know until Engagement Strategy. Sam moment for me during the they need to know it. Everything from; “How do Baumber, Managing Director Social Enterprise Academy we measure our social impact?” and “how do we of Social Enterprise Academy leadership programme was become financially sustainable?” to “how can International CIC, explains: understanding my own we motivate our team?” “With Impact Link, we are working style, core strengths delighted that the Scottish and that of my co-founder. Social Enterprise Academy helps answer Government is helping these questions by delivering learning and build connections between We approached things development programmes for individuals a global team of people differently and there was and organisations working for social change. working towards Sustainable a lack of communication Launched in Scotland in 2004, Social Enterprise Development Goals, sharing between us – the programmes Academy has replicated internationally and is challenges, advice and sparked a lot of interesting now sharing learning between 12 country teams focusing our efforts on doing conversations on how we can in Australia, Canada, China, India, Malawi, things differently. We have lots communicate better and how Malaysia, Pakistan, Rwanda, Scotland, South to learn from each other - and we can work together more Africa, Wales and Zambia. the world needs us to work effectively to take Khwaab to a together." whole new level. I’ve become Impact Link: Support for social a much more confident enterprises in India Building resilience amongst individual and a much more Social Enterprise Academy India, which is India’s changemakers confident entrepreneur since operated locally by MITRA, was launched in Pooja Chopra and Shruti taking part in the programme.”

54 September 2019 SOCIAL IMPACT FOCUS

AS A COLLABORATION BETWEEN THE SCOTTISH GOVERNMENT, MITRA AND SOCIAL ENTERPRISE ACADEMY INDIA, IMPACT LINK WAS CREATED TO BUILD THE RESILIENCE, CAPACITY AND IMPACT OF INDIA’S SOCIAL ENTERPRISES THAT ARE MOVING BEYOND THE INCUBATOR STAGES OF GROWTH.

During the 2018 Social Enterprise World Forum in Edinburgh, two of the key takeaways for delegates were; the need for collaboration and the need to build social enterprise ecosystems.

Creating space for reflection and safety to support peers and transform leadership practice is known to be a critical success factor in building a sustainable social enterprise ecosystem. It is vital that we develop emotionally intelligent, strategically aware and operationally resilient leadership - investing in our people, at all stages of career and organisational growth.

Shruti Venkatesan, 2018 Impact Link Fellow and Co-Founder of Khwaab, explains: “Nowadays it has become all the more important for entrepreneurs to not work in silos, but to engage with the entire ecosystem, which requires entrepreneurs to have extremely strong leadership abilities.” While Albin Jose, Co-Founder of social enterprise sharing of Lal10, a social enterprise which aims knowledge between Scotland and Through partnering with the Scottish to revive the traditional creative art India. Founding Director Danielle Government and MITRA, the Social forms of India, said: “I believe it’s very Trudeau said of being an Impact Link Enterprise Academy has been important for social entrepreneurs mentor: "Working with Pooja and privileged to help develop people in to develop their leadership skills in Shruti of Khwaab was thoroughly the next generation of social change the current climate because social enjoyable. They were both hugely leaders in India. After two years of entrepreneurship can be a lonely energetic and passionate about their developing Impact Link, there is now road. It takes a lot of motivation and a social enterprise and the experience the opportunity for corporations or lot of grit to follow that path, to solve gave me new insights into some of philanthropy to match fund alongside a problem that affects a large section the challenges they were facing in Scottish Government. of the lower end of the population. India. Sustainability challenges seem You need to build a community that to be universal but so is the drive to Achieving the Sustainable supports each other and motivates create positive change." Development Goals will need all each other to move forward.” of us working together, across Since the successful launch of organisations, sectors and countries. Connecting India and Scotland Scotland: India Impact Link in 2018, Enabling access to learning and development for changemakers through social enterprise the collaboration has now been who ordinarily cannot afford it, is an Tribe Porty is a Scottish social launched in Pakistan and China, as essential step towards making that enterprise which provides a space for a partnership between the Scottish change happen. nurture and growth of human potential Government, Social Enterprise through supporting local people in Academy and SEED Ventures work, art and quality of life. This is (Pakistan) Capacity Building and done through practical opportunities Assessment Center (China). and support and encouraging Jess Kemp is the Senior connections. As an Impact Link The need for learning and Partnerships Officer at the mentor, they were partnered with development in Social Enterprise Social Enterprise Academy. Khwaab Welfare Trust to encourage Ecosystems www.indiaincgroup.com September 2019 55 SPECIAL REPORT India expands mark in global university rankings by India Inc. Staff

Indian universities made their mark in the 2020 global university rankings, but more work is needed as they slipped out of the top 300 bracket.

ndian universities have expanded and economy and use of English- research collaboration. It now needs their presence in the annual language instruction. However, it is to back up these aspirations with high rankings of the world’s leading disappointing to see the country fall levels of investment – or risk declining Ieducational institutions but dropped out of the top 300 of the rankings further amid increasing global out of the top 300 bracket in the this year, with only a small number of competition, especially from other ‘Times Higher Education World institutions registering progress,” said parts of Asia,” she said. University Rankings’ for 2020 Ellie Bothwell, ‘THE’ rankings editor. released recently. Overall, 56 Indian universities feature in the table, up from 49 last year. As India’s top-ranked university, "THE INDIAN a result, India holds on to its place Bangalore’s Indian Institute of Science as the fifth most-represented nation (IISc) declined, marking the first time GOVERNMENT HAS in the world and the third most- that India is not in top 300 since 2012 STRONG AMBITIONS TO represented in Asia, behind Japan in the tally once again topped by the BOOST THE GLOBAL and mainland China. It has eight more UK’s University of Oxford. IISc still STANDING OF ITS TOP universities than Germany, which is ranks the highest for India but has UNIVERSITIES AND sixth in the country ranking, but 25 dropped into the 301-350 bracket ATTRACT FOREIGN fewer than China. (from 251-300 cohort), due to what STUDENTS, ACADEMICS has been described as a significant Newcomer Indian Institute of fall in its citation impact score AND RESEARCH Technology Ropar makes an offsetting improvements in research COLLABORATION. impressive entry, pushing Indian environment, teaching environment Institute of Technology Indore, which and industry income. remains in the 351-400 band, into “The Indian government has strong third place. Overall, seven Indian “India has a huge amount of potential ambitions to boost the global standing universities fall into a lower band this in global higher education, given of its top universities and attract year, while the bulk of the nation’s its rapidly growing youth population foreign students, academics and institutions remain stable. But there

56 September 2019 SPECIAL REPORT

is a small number of risers, including The University of Cambridge, Stanford introduced a two-year post-study Indian Institute of Technology Delhi, University and the Massachusetts work visa for international students, Indian Institute of Technology Institute of Technology (MIT) all allowing overseas graduates a Kharagpur and Jamia Millia Islamia. drop one place to third, fourth and significantly longer period of time to fifth respectively, while Princeton find work after their studies. The best Indian institutions University and Harvard University are generally characterised by swap places to finish sixth and “This announcement from relatively strong scores for teaching seventh respectively. Yale University government is a tremendous boost environment and industry income, holds steady in eighth, the University for the UK capital, which will further but perform poorly when it comes to of Chicago rises one place to ninth, enrich London’s post-study offer for international outlook in comparison while Imperial College London falls international students and provide to both regional and international one place, rounding out the top 10. exciting opportunities for employers counterparts, ‘THE’ rankings notes. here. Our institutions are committed to The UK capital, however, claimed attracting and nurturing bright young While Oxford tops the global rankings a major win with four universities in minds from all over the world, who will for the fourth year running, the the city listed in the top 40 – more go on to become global ambassadors California Institute of Technology than any other city in the world. The for our city,” said Lalage Clay, Director, (Caltech) rises from fifth to second. news came as the UK government Education and Talent at London & www.indiaincgroup.com September 2019 57 SPECIAL REPORT Partners, the Mayor of London's College London (36th), and Queen performance metrics, with over 170 official promotional agency London & Mary University of London (110th) separate data points on each of the Partners and home of Study London. make up London’s leading top-ranked world’s leading research universities universities. and two global surveys of senior, Imperial College London (10th), published scholars from its annual University College London (15th), ‘THE World University Rankings’ reputation survey: with more than London School of Economics and are drawn from the ‘Times Higher 21,000 responses adding 250,000 Political Science (27th), King’s Education’ database of university items of data.

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www.indiaincgroup.com@orfonline @orf_online https://www.orfonline.org/cned/September 2019 59 LAST WORD Sitharaman wields the tax axe By dramatically slashing corporate taxes, India’s gritting Finance Minister has given a big boost to India’s private sector and brings the country closer to becoming a low-tax, high-efficiency economy that the Modi government aspires for.

he recent cuts in corporate tax and minimum alternative tax rates by Indian Finance TMinister Nirmala Sitharaman will provide a much-needed stimulus for companies in India. It may well also help the country attract companies that are looking at alternative destinations to set up manufacturing facilities in the wake of the US-China trade war by incentivising the setting up of new manufacturing facilities in the country. up growth and, more importantly, the sputtering investment cycle that resurrecting sentiments that were has been stubbornly refusing to pick On the flip side, the tax cuts could down in the dumps. The immediate itself up for the last few years. lead to fiscal slippage for the benefit is increased cash flows to government and raise the fiscal corporate India that will be either These tax cuts will initially lead to a deficit to up to 4 per cent, against channelised into debt reduction or revenue loss of more than $20 billion the target of 3.4 per cent, if it is not incremental investments in increasing for the government, but in doing so, accompanied by spending cuts. In capacity,” says a report by Crisil, provide a major stimulus to the Indian the view of ‘India Global Business’, the Indian subsidiary of Standard & corporate sector. this will be a short-term issue and Poor’s. we anticipate the private sector will Fiscal gap may widen treat this as the confidence-building These tax giveaways are expected measure to reassure them that the THESE TAX CUTS WILL to widen the fiscal deficit, given the Modi government is backing them INITIALLY LEAD TO A government’s tight fiscal position to get the investment cycle moving REVENUE LOSS OF MORE and the absence of buoyancy in tax again. THAN $20 BILLION FOR revenues. This could rise to as much THE GOVERNMENT, BUT as 4 per cent against the Budget Early Diwali for India Inc. IN DOING SO, PROVIDE target of 3.4 per cent, since the higher On 21 September, Sitharaman earnings and the accompanying rise wielded the axe on India’s relatively A MAJOR STIMULUS TO in revenues will take place only after high rate of corporate tax, cutting it THE INDIAN CORPORATE a lag. from 34 per cent to a fraction over SECTOR. 25.17 per cent, thereby redeeming Cut in public expenditure a promise made by former Finance As of now, the only way for Minister, the late Arun Jaitley five Further, in a bid to boost the Make Sitharaman to help balance her books years ago. In her Budget on 5 July, in India programme, attract foreign seems to be a cut in the government’s the current Finance Minister had investment in the manufacturing spending programme. But that could reduced the tax for companies with sector and make India competitive lead to a growth slowdown. She is a turnover of up to $55 million. Now, compared to China and the obviously hoping that her incentives the rate has become universal for ASEAN countries, the government will kickstart the investment cycle and all companies that do not take the has allowed any new company obviate the need for large government benefits of any other exemptions. incorporated in India on or after expenditure to keep the wheels of the Such companies will not also have 1 October 2019 and making Indian economy running. to pay any Minimum Alternate investments in manufacturing to pay Tax (MAT). Now, the peak rate of income tax at 17 per cent. These She has done well to wield the axe corporate tax is comparable to the companies will, however, have to start on tax. She will now have to execute lowest rates charged by many other production on or before 31 March a careful balancing act over the next competitor countries. 2023. few months to ensure that the private sector gets charged up. “This is a massive trigger for revving This move is expected to kick start

60 September 2019 INDIA GLOBAL BUSINESS

‘India Global Business’ is the flagship publication of London-based media and publishing house India Inc. The publication offers in-depth analysis, news and expert opinion on business, trade, policy initiatives and foreign direct investment in and out of India. The magazine has a readership of over 100,000 business and policy leaders worldwide. YOUR NEXT BUSINESS MODEL WILL USE DIGITAL TO DELIVER ON-DEMAND

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