August-September 2012 | Volume 03 | Issue 03 Business and Economy Microfinance emerGING ENTREPRENEUR Innovation Corner Rang De is colouring the Rural A technology that provides a Biotechnological engineering landscape in hues of joy Commonfloor For Residents mitigates human Pain

Engineering The Future India lays the groundwork for growth

A view of Bandra-Worli Sea Link, Mumbai, India editorial Volume 0103 | Issue 03 | Aaugust-septemberUGUST-SEPTEMBER 20122010

www.ibef.org

Editorial Editor: Anuradha Das Mathur Consulting Editor: Deepak Garg Managing Editor: Sangita Thakur Varma Sub Editor: Radhika Haswani

DEsign A Framework of Steel Sr Creative Director: Jayan K Narayanan Art Director: Anil VK With a reservoir of Associate Art Director: Atul Deshmukh SR Visualiser: Manav Sachdev natural resources, India Visualisers: Prasanth TR, Anil T & Shokeen Saifi lays the groundwork for Sr Designers: Sristi Maurya & NV Baiju Designers: Suneesh K, Shigil N, Charu Dwivedi engineering. Raj Verma, Peterson, Midhun Mohan & Prameesh Purushothaman C, Haridas B Chief Photographer: Subhojit Paul he 21st century world is a challenging place to be Sr Photographer: Jiten Gandhi in. The world order is witnessing paradigmatic shifts dictated by economic compulsions. We are Sales & Marketing National Manager-Events & Special Projects: Mahantesh Godi progressively moving into a state where no nation Regional Manager (South): Vinodh K can exist in isolation. The reality of the 21st century Regional Manager (North): Lalit Arun is a multipolar, multi-aligned world. T Regional Manager (West): Sachin Mhashilkar In the 21st century, our engineers are being seen as the keepers Production & Logistics of life’s frontiers. The National Academy of Engineering, US, Sr. GM. Operations: Shivshankar M Hiremath has identified Grand Challenges for Engineering in the era. Manager Operations: Rakesh Upadhyay Several other engineering bodies too have drawn up similar Asst. Manager - Logistics: Vijay Menon vision documents, the purport of all being optimum utilisation Executive Logistics: Nilesh Shiravadekar of existing resources, while we research, innovate and engineer Production Executive: Vilas Mhatre to better the quality of human life. Indian engineering is Logistics: MP Singh & Mohd. Ansari right there at the forefront—CGN Research Labs shows how INDIA BRAND EQUITY FOUNDATION biomedical technology can be harnessed to alleviate human CEO: Aparna Dutt Sharma misery. Read Innovation Corner to know more. Project Manager: Ruby Singh Come September 10, India’s engineering expertise will be on display in Central Europe. It is a partner country at the 54th International MSV-Brno Engineering Fair in the Czech Republic. A favoured destination for foreign firms to set up their India Now—Business and Economy is a bi-monthly magazine published and manufacturing base, India manufactures almost all categories printed by India Brand Equity Foundation (IBEF), Gurgaon. It is published at Apparel House, 5th Floor, #519-22, Sector 44, Gurgaon-122003, Haryana and of engineering goods. It exports a vast portfolio of engineering printed at GH Prints Pvt Ltd. A-256 Okhla, New Delhi-20. The magazine is edited by Anuradha Das Mathur, Nine Dot Nine Mediaworx Pvt Ltd., B-118 Sector 2 goods worth US$ 60 billion to more than 180 countries. Read our Noida–201301, Uttar Pradesh. India Now—Business and Economy is for private circulation only. Material in this cover story to learn how India is engineering for the 21st century. publication may not be reproduced in any form without the written permission of IBEF. Editorial opinions expressed in the magazine are not necessarily those of IBEF and IBEF does not take responsibility for the advertising content, content obtained from third parties and views expressed by any independent author/ contributor. (India Brand Equity Foundation, c/o Confederation of Indian Industry, Apparel House, 5th Floor, #519-22, Sector 44, Gurgaon-122003, Haryana, India; Tel: 91-124-4014060-67; Fax: 91-124-4013873/75; Email:[email protected]). Opinions expressed herein are of the authors and do not necessarily reflect any opinion of Nine Dot Nine Mediaworx Pvt Ltd., B-118 Sector 2 Noida – 201301, Sangita Thakur Varma Uttar Pradesh, India; Tel: 91-120-4010-999; Fax: 91-120-4010-911; Email: [email protected]

www.ibef.org august-september 2012 1 VolumE 03 | Issue 03

ContentsAugust-September 2012 IGN: X xxxxx S VER DE

O 1216 C

Cover Story MNC Watch | 10 | Partner in 16 Engineering Perfection India’s Power At the 54th MSV-Brno International Journey: ABB Ltd ABB has a six-decade-old Engineering Fair in the Czech relationship with India, Republic, India participates as the focussed on partnering the country in its growth story Partner Country. We take a look at our arts & culture 52 | Art for now: engineering strengths on display Sakshi Gallery India’s first multilocational art gallery, is today the Copyright Published & printed by India Brand Equity Foundation (IBEF), Apparel House, 5th Floor, #519-22, Sector 44, Gurgaon-122003, Haryana. India largest gallery space devoted Please Recycle Now–Business and Economy is for private circulation only. Material in this This Magazine to the promotion And Remove publication may not be reproduced in any form without the written permission Inserts Before of IBEF. of contemporary art and Recycling young artists

2 august-september 2012 www.ibef.org 3648

innovation corner 50 | With a human Heart A research lab with a vision to harness biomedical engineering to alleviate human pain is innovating medical devices successfully. Thermo Scan is the first device among many to follow

made in india 46 | hero No. 1 Hero MotoCorp has remained the undisputed leader of the two-wheeler market since 2001, unaffected even by the 2010 split with Honda 2026

Emerging Entrepreneurs RegulArs 28 | For a Common Cause 01 | Editorial A group of friends build Commonfloor 04 | National Round-up 12 | Micro Finance on an idea that promotes both online and 54 | Tourism Update offline interaction among city dwellers 58 | Bookshe lf 60 | rura l update

SECToral update 48 48 48

32 | Cement: 35 | Computer 38 | Gems & Jewel- 43 | Handloom Cementing Growth Peripherals: The lery: Brilliant Exports: Spinning The cement industry is Soul of IT Prospects Success poised for another growth Policy push and widening Given Indian consumers’ Traditional weaves with the phase on the back of infra- IT base are the growth penchant for jewellery, this added charm of contemporary structure & housing boom drivers for this sector sector only shines brighter interpretations

www.ibef.org august-september 2012 3 Voice of A visionary “Destroying a rain forest for economic gain is like burning a Renaissance painting to cook a meal.” National Edward O Wilson (American Biologist and Environmentalist) Round-up

India-China Discuss Trade Ties Data Briefing Set up JWG to look into investments US $

INDIA and china held a crucial meeting of the Joint India of addressing its concerns regarding market Economic Group (JEG) on August 27, 2012, in New access for its pharmaceutical and IT companies’ prod- 100 Delhi to discuss trade issues. Union Minister for ucts and services. The Commerce Ministers’ meeting Commerce, Industry and Textiles, Anand Sharma and is expected to bring about high level changes that will billion his Chinese counterpart Jeng Deming chaired the add speed and ease to boost trade ties. The Chinese ninth round of the high profile EJ G. The eighth round commerce minister is also scheduled to meet indus- by 2015: of the talks was held in 2011. try leaders for an interactive chat during his two-day india and China agreed to set up a Joint Working visit. China is confident about trade prospects with China’s Group (JWG) that would look into trade related issues India and at a joint press briefing of the two ministers trade as well as investments between the two nations. The post the meeting, Mr Deming was hopeful that bilat- target JWG is expected to submit a report within 90 days eral trade between the two countries would reach the on its findings and recommendations. China assured target of `56,500 crore (US$ 100 billion) by 2015.

4 august-september 2012 www.ibef.org National Round-up

They Vladimir Said it Putin

In a message to President Pranab Mukherjee on In- dia's 66th Independence Day on August 15, 2012. “Over the years of sovereign development your country has achieved impressive results in social-economic, industrial and scientific spheres…Today India as an authoritative member of world community plays an important role in Hotels in India are Highly UN, SCO, BRICS, other global Profitable Survey ranks India No. and regional 5 for best business outlook hotels structures.” the hotel industry in India is buoyant. In a global survey of more than —Vladimir Putin, 25,000 hotels worldwide conducted by travel site TripAdvisor, India President, Russian Republic ranked fifth in the world and second in Asia Pacific (APAC) for hotels with the best business outlook. The survey result, declared in August 2012, revealed some interesting findings. Close to 1,500 Indian hoteliers par- ticipated in the survey that found the highest percentage of respondents from India and Indonesia with highly profitable businesses. While both the countries reported six per cent extremely profitable businesses, India reported 29 per cent very profitable businesses while Indonesia had 38 per cent in the category. India also exhibited a positive outlook through its staffing pattern. While most other APAC countries said that they did not anticipate further recruitment in the next six months, 39 per cent of the Indian respondents were positive of increasing staff. Globally too, India ranked the highest for staff turnover based on its increased recruitment.

RESEARCH UPDATE The clinical research organisation (CRO) market in India is growing at 11-13 per cent and registered revenues to the tune of `2683.99 crore (US$ 485 million) in 2010-11, according to research firm Frost & Sullivan. The consulting firm estimates that by 2016, the market will grow to `5,534 crore (US$ 1 billion).

www.ibef.org august-september 2012 5 National Round-up

Sound bites “We clearly see a potential in the Indian mar- ket... Indian market is still growing and at a pace better than many other devel- oped parts of the world.” -Banmali Agrawala, India Region President & CEO, GE Energy

photos by photos.com “To tap into the Pune, the New Business Destination opportuni- US firms choose Pune to set up base ties of this decade, we need new ideas Pune is Emerging as the an office in Bangalore and from the US. favoured destination for plans to open more across According to industry esti- and the best way US businesses with many the country. mates, the annual exports of doing that is by companies keen on expand- There are other US com- from Pune are to the tune ing operations in this panies like Swipe Telecom of `30,000 crore (US$ 5.4 creating successful Maharashtra city. The eighth and Eaton that have made billion). Market analysts say start-ups.” largest metropolis of India Pune their base. Swipe, that 40-50 per cent of this has fast emerged as an IT which is in the business export is to the US market. -Esther Dyson, Legendary angel investor, on India’s first telecom and education of selling low- Pune is today at No. 7 on incubator Start-Up Village in Kochi hub attracting The eighth cost tablets, the industrial metro map of many overseas largest and Eaton, a India. Its rise to prominence companies to metropolis of power solutions started in 2002, with large set up their India is at the company, are automobile giants making “For an base in the city. both planning huge investments in the economy The latest com- No. 7 spot on further expan- city, which had a multiplier pany from the the country’s sion in India. effect. In 2007, the govern- like US to join the industrial Pune has also ment set up a `60-crore India…the more swelling num- metro map. emerged as a Auto Cluster Development bers is taxation huge outsourc- and Research Institute, diverse you get, expert H&R Block. ing hub with a number of which helped Pune emerge the more you can The global tax experts business process outsourc- as an auto hub with a vibrant with over 50 years of experi- ing centres (BPO) catering ecosystem in India. achieve sustained ence opened their corporate to the US and European Today, the city has become stability...” office in Pune to serve more markets. A large part of the the preferred destination for -Steve Almond, Global Chairman than 8,000 clients across the BPO business that comes investments, for both indi- of Audit, Deloitte Touche Tohmatsu country. H&R Block also has to Pune is being outsourced viduals and conglomerates.

6 august-september 2012 www.ibef.org National Round-up

BUSINESS Update Investment India Tops Exports Growth Rate update Kolkata: Potential Medical Tourism Hub New medical facilities coming up

Kolkata has the potential to and certain other speciality hospi- become a major medical tour- tals at Rajarhat New Town in a bid ism destination in South Asia, to strengthen the state’s medical Debashis Sen, Principal Secre- infrastructre. The Tata Medical tary of the Urban Development Centre for cancer research is ready Department, West Bengal, said. at Rajarhat and is one of the major “There is great possibility of turn- healthcare facilities in the city. A india Has overtaken all of any major economy at 9.3 ing Kolkata into a health tourism hospital for cardiac patients is also major trading countries in per cent,” says the report. hub for South East Asian coun- under construction. the world to emerge as the The positive strides in Indian tries, Bangladesh and The government has country with the highest exports are the result of a Nepal, with the rapidly allotted land for the exports growth rate, accord- strategic and planned initia- growing healthcare development of a ing to the World Trade tive undertaken by the Gov- infrastructure in the 49 trauma care centre and Report 2012 from World ernment of India and the city,” Sen said. He was school of paramedical Trade Organisation (WTO). exporters. addressing the inau- lakh science as well. It is It beat its nearest competi- Under this measure, the guration of an exhibi- medical tourists being hoped that with tor China, recording a jump government provided incen- tion and conference such state-of-the-art of 16.1 per cent in 2011. In tives to exporters to explore expected by 2025; on healthcare infra- medical centres in the 2010, China was at the top new markets to offset the structure and medical 24 lakh by 2020 West Bengal, the state with an exports growth rate slowdown in their traditional equipment, organised Source: Technopak can compete as a medi- of 28.4 per cent, while India markets like the US and by Confederation cal tourism destination was at the second place Europe. The diversifica- of Indian Industry. in the region. with 22 per cent growth rate. tion of exports markets as The Government of india’s traditional “India had the fastest export well as products took the West Bengal has allotted land to healthcare systems already had a growth among major trad- exporters to Latin America some upcoming ventures includ- huge global market. Now it has ers in 2011, with shipments and Africa in search of ing Chittaranjan National Cancer been gaining grounds for its con- rising 16.1 per cent. Mean- new export hubs and this Institute, Shankara Nethralaya, a ventional medical care and treat- while, China had the sec- immensely benefited the global organ transplant hospital ment as well. ond-fastest export growth country’s shipments.

Business Tracker tea annually and is a highly quality conscious market. Wah Chai! Destination The festival was a part Khazakhstan for Indian tea of Project 5-5-5, Tea Board India’s overseas indian tea is making its Khazakhstan is the second promotion initiative, of mark everywhere. As a part largest importer of Indian tea which Khazakhstan, a of India’s 66th Independence in the CIS (Commonwealth leading importer, is a focus Day celebration, a three-day of Independent States) country. The country imports Tea Festival was organised region. India is the largest more Assam tea than the by the Tea Board in Almaty, supplier of tea to the country Darjeeling variety, with Khazakhstan, in August, with a market share of 40.9 annual imports amounting drawing 5,000 visitors. per cent. Khazakhstan to about `227.46 crore Notably, after Russia, imports 28 million kg of (US$ 41 million).

www.ibef.org august-september 2012 7 india

watch Area Population Male Female Population Density Urban Population 3,287,263 sq km 1.22 billion 628.8 million 591.4 million 387 per sq km 380.214 million

Key performance India’s Economic Outlook Projection indicators of the Fiscal Year 2008-09 2009-10 2010-11 2011-12 2012-13 Indian economy GDP Growth 7.3% 5.4% 8.5% 7.00% 6.5% with patterns, CPI 9.3% 5.5% 14.44% 8.87% 9.5% trends and forecasts Source: RBI

Mean Probability Pattern of Real GDP Growth Forecasts 2012-13 2013-14 40.0 Real GDP growth rate forecast for 2012-13 is revised downwards to 6.5 35.0 per cent from 7.2 per cent in the last 30.0 survey. Forecasts for agricultural GDP remained unchanged at 3.0 per cent. 25.0 Growth forecast for GDP of industry is

20.0 revised downwards to 4.0 per cent from 6.0 per cent and growth forecast for 15.0 services GDP is revised downwards to 8.0 per cent from 8.8 per cent in the last 10.0 survey 5 .0

0.0 forecasters professional of survey RBI Source: 4 to 4.5 to 5.5 to 6 to 6.5 to 7 to 7.5 to 8 to 8.5 to 9 to 9.5 to 4.4 % 4.9 % 5.9 % 6.4 % 6.9 % 7.4 % 7.9% 8.4% 8.9 9.4 9.9 Chart 1: Year-on-Year Growth in IIP Chart 2: Year-on-Year Growth in Sectoral Indices 16% 16%

12% 12% 8% 8% 4% 4% 0% 0% -4% -4% -8%

-8% CSO Source: -12% CSO Source:

Jul-09 Apr-10 Oct-10 Feb-11 Apr-11 Jun-11 Oct-12 Feb-12 Apr-12 Apr-08 Feb-09 Oct-10 Mar-11 Oct-12 Feb-12 Apr-12 June-10 Aug-10 Dec-10 Aug-11 Dec-12 Sep-08 Dec-09 May-10 Aug-11 Dec-12 Mining Manufacturing Electricity

8 august-september 2012 www.ibef.org India Watch

Chart 3: Contribution to IIP Growth Chart 4: FDI and FII Inflows in May 2012 10.00

Non-durables 4.0% 8.00 0.0% FII 3.0% Durables, 1.3% 6.00 FDI (in USD 2.0% Intermediate, Electricity 4.00 billion) 0.6% 0.4% 1.0% Basic, 1.7% 2.00 0.0% Manufacturing 2.0% Capital, -1.0% 0.00 -1.0% Mining -0.1% -2.00 Source: RBI Source:

-2.0% CSO Source:

Oct'11 Nov'11 Dec'11 Jan'12 Feb'12 Mar'12 Apr'12

Monthly Trends in Wholesale Price Key Macroeconomic Indicators Index-Monthly Average (% change) Cash Reserve Ratio All Commodities 7 7 Primary Articles 6 6 Fuel Power Light & Lubricants 5 Manufactured Goods 5

4 4

3 3 2 2 Source: RBI Source: 1 1 0

March April March April 0 RBI Source: 2011 2011 2012 2012

Aug-2011Sep-2011Oct-2011Nov-2011Dec-2011Jan-2012Feb-2012Mar-2012 Apr-2012May-2012Jun-2012 Stock Market Sensex %age Change S&P CNX NIFTY %age Change Jan-12 15,534.67 -6.17 5125.25 9.99 Repo Rate and Feb-12 17,179.64 10.59 5412.95 5.61 Reverse Repo Rate Mar-12 17,714.64 3.11 5296.35 -2.15 9 Apr-12 17,429.96 -1.61 5246.75 -0.94 8 May-12 16,218.00 -7% 4924.25 -6% Jun-12 17,429.48 7% 5278 7% 7 July-12 17,490.81 0% 5229 -1% 6 Source: RBI Source: 5

4

Currency Exchange Rate 3 INR/USD INR/GBP INR/JPY INR/EUR 2 Jan-12 49.69 77.94 65.11 65.17 1 Feb-12 49.15 78.15 63.81 65.22 Source: RBI Source: 0 Mar-12 50.86 81.45 61.38 67.88 Apr-12 51.50 82.06 63.58 67.80

Jul-2011 Feb-2012 May-12 55.74 87.56 70.10 68.89 Aug-2011Sep-2011Oct-2011Nov-2011Dec-2011Jan-2012 Mar-2012Apr-2012May-2012Jun-2012

Jun-12 55.42 85.25 70.89 68.81 Repo Rate July-12 55.52 87.23 69.56 70.31 Reverse Repo Rate Source: RBI

www.ibef.org august-september 2012 9 MNC WAtch ABB Limited

COMPANY DASHBOARD

Company: ABB (India) Limited Asea Brown Boveri (India) Ltd

Established: 1949

Located in: 49, Race Course Road, Bangalore, 560001

Area of Focus: Power Products, Power Systems, Low Voltage Products, Process Automation, Discrete Automation

Network: Sales Turnover: `7,448 crore in FY11 Headcount: 10,000 Manufacturing units in India: 12 Partner in India’s Power Journey India and Asea Brown Boveri (ABB) Ltd go back a long way— nearly six decades, to 1949. Today, the automation major is working on making the country an export hub for power equipment with a thrust on better and cost-effective technology for a sustained infrastructure growth in India. By Kamal Kumar

10 august-september 2012 www.ibef.org ABB Limited MNC WAtch

ndia has long been considered lies underrated and underused. Bazmi the land of frugal engineering. R Husain, Country Manager and But we, as a nation, have been Managing Director of ABB Ltd, says, striving to enhance our ability “ABB’s global plan is to make India an to move from small improvised export hub.” In fact, some equipment Ichanges to high-value and great-impact that ABB exports is manufactured at innovation. Rapid industrialisation and its India and Germany plants only. The economic growth not only provided company is now foraying into Africa us the opportunity to look for greater and has posted employees from its innovation and efficiency in technology, India unit there. The overall export of Ibut in the process, made the country the company is a little less than 15 per self-reliant in the field of research and cent of the total revenue, and Husain is cutting-edge innovation. MNCs like confident of growing it. Asea Brown Boveri Ltd (ABB Ltd), a India is expected to expand its power `93,480-crore (US$ 35-billion) global infrastructure substantially in the com- “ABB’s global plan leader in power and automation tech- ing years. The country has an installed nologies have made a significant contri- power generation capacity of around is to make India an bution in this endeavour. 200,000 megawatts (MW) and accord- export hub of power ABB Ltd has been partnering the ing to estimates of the International equipment and India growth story for close to six Energy Agency, India needs to invest decades. The company was incor- more than `746,280 crore (US$ 135 automation... We porated in 1949, as The Hindustan billion) to add 600 and 1,200 gigawatt maintain a positive Electricity Company Limited, which (GW) of additional power generation outlook as we move was subsequently changed to Hin- capacity by 2050 to provide universal forward with our dustan Brown Boveri Limited (HBB) access to electricity for its population. in 1965. In 1987, post the merger of The ambitious capital expenditure pro- investment plans.” Switzerland’s BBC Ltd and Sweden’s jections for the power sector in the 12th — Bazmi R Husain ASEA Ltd and pursuant to the scheme Five Year Plan have spurred ABB India Country Manager & MD, ABB India of amalgamation in 1989, HBB got its to step up the localisation process. In new name Asea Brown Boveri Limited. the press release announcing the Q1 looking up. Its April-June quarterly ABB’s operations in India are valued at (first quarter) results on May 09, 2012, result declared on August 08, 2012, `9,397.7 crore (US$ 1.7 billion), which Husain said: “Some of our initiatives pegs net profit at `52 crore (US$ 9.40 include 12 manufacturing facilities and including operational excellence have million) on a revenue of `1,858 crore an employee base of more than 10,000 helped bring significant improvement (US$ 335.74 million) for Q2 (second people. The company has an exten- in the current market scenario. We quarter). The company received orders sive product range across segments maintain a positive outlook as we move worth `2,045 crore (US$ 369.93 mil- including power systems and products, forward with our investment plans lion) in the concluding quarter whereas process and discrete automation and from manufacturing lines, enhanc- the order backlog stood at `9,175 crore motion low-voltage products. The ing existing capacities, introducing (US$ 1.6 billion), according to the customer servicing encompasses 23 new products and solutions with the company press release. Existing global marketing offices, eight service centres, use of best engineering and research economic concerns notwithstanding, three logistics warehouses and a net- and development.” He maintains Husain, remains unfazed. “While the work of over 550 channel partners. that the key to the Indian landscape short-term macroeconomic outlook is ABB India’s commitment to part- and market lies in “research”. In sync a concern, we remain optimistic over nering India in its forward journey with its gameplan, ABB India bagged the long term. Opportunities will come finds reflection in the setting up and a Power Grid Corporation of India up in the emerging sectors like smart functioning of the Global Corporate Limited contract recently to deliver an grids, cyber security, renewable and Research Centre in Bangalore. It is the ultra high-voltage direct current trans- energy efficiency solutions.” It does not company’s largest research centre any- mission system. The link will supply stop here for ABB. For, “To retain our where in the world and accounts for 30 hydropower from northeast India to leadership position, we are continually per cent of its R&D in process automa- Agra in central India through a 1,700 benchmarking our internal productivity tion worldwide. ABB India believes that kilometer long transmission link. The and product competitiveness for world- the potential of India as an export hub company's financial picture is also class operations.”

www.ibef.org august-september 2012 11 MicroFinance Rang De

Community Time: Rang De functionaries interact with the community during a field trip. blog.rangde.org PHOTO BY Rang De India! A young bunch of social entrepreneurs have brought a new meaning to microfinance through an eclectic mix of social media and social responsibility. By Sangita Thakur Varma

era Rang De Basanti struggle for freedom which our forefa- Is it an MFI? Chola, Mera…” Come thers fought,” says Smita, Co-founder “Rang De is not an MFI but a crowd- 15th August and the and Managing Trustee. A visit to the funding platform that connects indi- nation rises as one to institution’s website is a revelation. It viduals to their rural counterparts,” honour its freedom is exuberant, youthful and more like a clarifies Smita. Mfighters. From FM radios to television social media marketing website than So how does this model work? “Rang channels all do a rewind and play out one with a serious purpose—that of De works with Micro Finance Institu- these unforgettable lines enveloped being a bridge between young well- tions (MFIs) and NGOs as field partners in patriotism. The song has inspired heeled Indians and their rural brethren. and with communities through this generations evoking vibrancy, youth, Forbes India has hailed Rang De network of field partners,” explains colour, zest and at the same time dedi- as “Innovation in financial inclu- Smita. As a lender you can choose the cation to a purpose—from the critically sion”, while The Economic Times calls specific entrepreneur (from those listed acclaimed film Rang De Basanti to Rang it “India’s first online platform for on the website), in whose venture you De, a unique organisation engaged in microcredit”. Rang De is a not for profit want to make a social investment. The making microfinance affordable. social investment platform that enables entrepreneurs are selected through a “The name Rang De was chosen with you to do your bit for India’s growth by rigorous screening process and their the objective of providing a strong lending as little as `100! As Smita says, profiles with pictures are put up on the brand connect for the youth. At the “Our attempt is to provide a way for website. The lenders can go on field same time, it is also a reminder of the individuals to make a difference.” trips to interact with borrowers or opt

12 august-september 2012 www.ibef.org Rang De MicroFinance

for an audio evaluation. The borrower invite your friends to a group and 2008, but the conceptualisation of and evaluation provides the complete profile groups can be private or public. research for the initiative began in late of the individual loanee, stating the pur- 2006 when Prof Yunus was awarded pose of the loan, the current status of Mission Alleviate the Nobel Peace Prize for Grameen his loan, the lender as well as the field “Rang De’s mission is to lower the cost Bank. That was their first brush with partner associated with the borrower. of microcredit and currently provides microfinance. For instance, Fatik De is an eatery stall loans to borrowers at interest rates that Smita, with a master’s degree in owner in West Bengal who had taken range from 5 per cent flat per annum social research and some rich field a loan of `5,000 in October 2011 for {9 per cent APR (annual percentage experience with non profits in India chairs and plates. He has paid up 76 per rate)} to 10 per cent flat per annum (18 and abroad, co-founded Rang De with cent of the loan amount and wishes to per cent APR),” says Smita elaborating Ramakrishna (Ram). Ram is the Chief take another loan after paying this up. on the Rang De story. The organisation Executive Officer of Rang De and was His profile on the website includes a was officially launched on January 26, earlier with Vignettte Europe Limited. graph of his repayment history. He is also an Ashoka Fellow. Rang De ensures transparency The duo began research on dif- in its operations through these ferent models to understand various steps and with all informa- “Our efforts are the microfinance space from tion available on its website. You aimed at reaching an Indian perspective. “That can view the profile of lenders and was when we were drawn to the investors can see where all their out to underserved microfinance industry in India. money is being invested. Under communities in areas The interest rates charged were Rang De’s peer to peer investment more than 50 per cent APR. model, an investor can lend in where microfinance That made us pause and ques- an individual capacity, like Sid- is scarce. ” tion: if indeed microcredit can dhartha Agarwal has done. He has —Smita alleviate somebody from pov- been a Rang De social inves- Co-founder and Management Trustee, erty, then it should be afford- tor since January 31, 2011. So Rang De able. This and the fact that far, Agarwal has invested `900 individuals like ourselves were and has been paid back `566 not aware about microcredit of the loan amount. His small led us to start Rang De. We loan amount has impacted six invested our savings to kick- women micro entrepreneurs’ start Rang De as a platform lives in three states—Varsha that will enable individuals to Haridas, Rajani Nana and Maya support entrepreneurs from Punjaram in Maharashtra, low income households with Farjana in Madhya Pradesh `100 or more,” Smita says of and Bina and Jebunessa in Rang De’s genesis. West Bengal. Sandhya Raman The uniqueness of Rang De, lives in Dublin, USA, and has according to Smita, “lies in our been a Rang De social investor stories from the field–original since January 24, 2010. She content that spells hope and has loaned `3,10,200 and been success along with transparency repaid `2,34,966. Her invest- “The desire to do at every step of our operations.” ments have impacted 187 lives something socially Rang De is currently “sharing in 12 states. And there are 3,893 relevant was always there the colours of joy” in 12 states such social investors who have under microcredit, education together pooled in `8.35 crore but we did not have the and microventure loan catego- (US$ 1.5 million) into Rang financial means or know- ries. There is a unique gift card De’s initiatives. scheme that can be redeemed Another model of invest- how to take the plunge.” by the recipient and fund a ment is the Rang De Group. —Ramakrishna social investment at Rang Here you can either join an Co-founder and CEO, Rang De De—a gift that is pure happi- existing group or create one, ness for the recipient.

www.ibef.org august-september 2012 13 MicroFinance Rang De

Wide Portfolio Rang De does not limit itself to rural microfinance. “We support low income households in rural as well as semi-urban areas. Our efforts are aimed at reaching out to underserved communities in areas where microfinance is scarce,” says Smita. And educa- tion loans are popular in both these areas: “Our education loans are availed by the rural and the urban households alike,” she adds. Tilottma Das of Orissa is a daily wage earner who took a loan of `7,000 for her daughter’s board exams in April 2011 for a 12-month With `83.5 million period and has already repaid it. Similarly, Malabika Sardar of West raised impacting Bengal has also repaid the `7,000 the lives of 14,857 education loan she took for her Class VII son in July 2011. Both borrowers, Rang the women are now seeking fresh tainability. It gets one per cent De has many more loans under the category. of the interest paid by the borrower on every loan. At a people waiting for A Brand in the Making? significant volume of disburs- The Rang De team comprises a bunch al, this one per cent will be their share of the of young, enthusiastic social entre- enough to sustain our costs. colours of joy it preneurs, many of whom joined the At this point, we rely on fund organisation fresh out of college; oth- raising events and grants to promises to spread. ers gave up lucrative corporate jobs to make up for the deficit.” be a part of this meaningful venture. The potential for microfi- Smita enlightens: “We have been lucky nance is huge as the unmet need for to have a fantastic team and a great credit has been estimated at `300,000 don the colours of Rang De and spread chapter network across India. We are a crore (US$ 54,063 million). With ` 8.35 its joy— filmmaker Nagesh Kukunoor, small team and often many of us wear crore (US$ 1.5 million) raised impact- singer and musician Raghu Dixit and multiple hats.” The team members’ ing the lives of 14, 857 borrowers, Rang veteran actress Waheeda Rehman. names appear among those of evalua- De has many more people waiting for Rang De has close to 15,000 likes tors and field workers as well. their share of the colours of joy it prom- on its Facebook page. Is young India Rang De has found many votaries. ises to spread. hooked on to social responsibility? “We are also supported by a network of “The need of the hour is to inno- Smita isn’t too sure: “Facebook can be chapter members across India and in vate and create new models that will a great starting point for the uniniti- other countries as well,” says Smita. address the needs of low income ated to learn about Rang De and is a As Rang De spreads its reach, many households in a holistic way. It must great medium to reach out to the youth. more people are beginning to realise the also be ‘responsible’ and ‘borrower Getting ‘likes’ on the Facebook page advantages of its microfinancing model. friendly’ credit, the model which many is fantastic but it may not be the best “We have had a steep increase in the microfinance institutions are adopting,” indicator of active engagement and number of organisations approaching says Smita. Rang De is showing the involvement as change makers.” Many us for field partnerships,” says Smita. way; the repayment rate of the organ- of Rang De’s active social investors are But how does Rang De sustain itself isation is 99.18 per cent and its out- not on Facebook, but as long as there given its non-profit model? Explains standing portfolio of loan is `2.21 crore are ‘likes’ there is hope that they be Smita, “Rang De is a non-profit organ- (US$ 0.39 million). Little wonder, there turned into ‘invest’. isation but we strongly believe in sus- are many ‘star’ ambassadors willing to Rang De India!

14 august-september 2012 www.ibef.org winning the world with quality 3 Japan Quality Medals. 21 Deming Medals. The Japan Union of Scientists and Engineers lauds India’s quality manufacturing processes and skills.

For updated news-analysis on Indian business and economy Log on to www.ibef.org cover story India’s Engineering Strides

Engineering ------

Perfection------

14 august-september 2012 www.ibef.org India’s Engineering Strides cover story

------

------Engineering ------Perfection India is the partner country at the prestigious MSV International Engineering Fair 2012 at Brno, the Czech Republic from September 10-14. We provide you a preview of the country’s

IMAGING by X xxxxxxx engineering strengths that will be on display. By Sangita Thakur Varma

www.ibef.org august-september 2012 15 cover story India’s Engineering Strides “We! ? are! in the process of creating a ! Brand India? Engineering ” Aman!? Chadha, ! ?

------Chairman EEPC, in conversation with Sangita Thakur Varma, says he is confident of India’s

place under the sun ------based purely on its quality parameters.

Q: How is the Indian engineering s of January 2012, India industry perceived globally? Aman Chadha: The perception of Indian boasted of more than engineering industry is changing for the 160,000 cost-effective better. You have to remember that India engineering is competing with engineering innovations and giants like China and Germany. As such, ideas and over we are improving every year. To give you a flavour: in 1955 when EEPC India was 100,000 technology projects designed by born, we exported `55.34 crore (US$ 10 approximatelyA 300,000 students from million) worth of goods to handful of coun- tries primarily in Western Europe and the more than 500 colleges across the country. USA. Today, our exports are in the range of `33,2040 crore (US$ 60 billion), which The Government of India has one thing is clear—India has arrived is six thousand times the 1955 figure, and declared 2010-20 as the ‘Decade of on the global engineering stage with to over 180 countries. Of course, we need Innovation’, for which it won the clockwork precision and an eye for to move further since we are still heav- Hermes Award for the ‘Best Humanis- detail. The above indices are just a ily concentrated around a few regions, tic Policy of Innovation’. few pointers to what the nation has but we are making progress and are The Forbes magazine has listed Indian been quietly working at for the last diversifying. In 2004-05, EU and the USA conglomerates Hindustan Unilever 66 years since Independence in the accounted for nearly 40 per cent of our (HUL) and Bharat Heavy Electricals vast and varied field of engineering. It exports. Now, it accounts for 31 per cent. (BHEL) among the top 10 innovative has built a monolithic state-of-the-art ASEAN, Latin American countries, South companies in the world. infrastructure of which the Bandra- Asia, Africa and West Asia are increas- India ranks sixth in GE's Annual Worli Sea Link (BWSL) and the recently ingly becoming important markets for Global Innovation Barometer, a list of inaugurated Yamuna Expressway are a our engineering goods. In fact, when we the most “innovative” countries in the fine example. exhibit our products in hitherto untapped world. countries, we are told that they wish to do India’s ranking on the ‘innovation Advantage India business with us purely on grounds of the efficiency’ index, one of the prominent From being an importer of refined quality of our products. sub-indices of the Global Innovation engineering goods to manufactur- Regarding western standards, let me Index (GII), also jumped from 101st in ing for both domestic and interna- say that all regions have their technical 2010 to 9th in 2011. tional markets, the country has taken standards and we meet those standards. Looking at the above few indices, giant strides. The requirements of Further, globally there is an attempt to

18 august-september 2012 www.ibef.org ------India’s Engineering Strides cover story ------

------

“We are in the process of creating a ------Brand India? Engineering ”

harmonise standards and our Bureau of Indian so that we can move up the ladder quickly Q: Which products are in demand and what Standards (BIS) is ensuring that we match up when trade bounces back. is India’s share in the global market? to global standards. We are also in the process Iron and steel and its products, automobiles, of creating a Brand India Engineering and the Q: What would you say is India’s expertise shipping products and industrial machinery India Shows that we have been organising are in this vast field called engineering? for a range of industries like dairy account for taking us towards that path. The engineering industry is the largest seg- 55 per cent of our total engineering exports. ment of the overall Indian industrial sector. It They have a share of more than 1.5 per cent in Q: What is the size of Indian engineering accounts for three per cent of India’s GDP. In world exports for these categories of products. export and the industry’s outlook? 2009-10, as per the latest Annual Survey of India’s engineering exports in 2011-12 Industries data, the total Net Value Added by Q: Wherein are we looking to increase our accounted for a fifth of the country's total the engineering industry in India was export foothold? exports. It, therefore, has the largest share of `304,370 crore (US$ 55 billion). Engineering We are trying to diversify to Latin America, India’s merchandise exports in goods. The goods enjoy 30.5 per cent weight in the Index ASEAN, Africa and also South Asia, in engineering industry in India accounts for 27 of Industrial Production (IIP); 29.9 per cent countries where there is potential. Countries per cent of the total factories in the organised share of total investment; and 62.8 per cent like Iran, Pakistan, Myanmar, Japan, among sector and 29 per cent of total organised em- share in foreign collaborations. The impor- others, are some emerging countries where we ployment. Clearly in a globally integrated world, tant groups within the engineering industry are looking to increase our foothold. our exports too have been affected this fiscal. include machinery & instruments, primary and But let me also point out that in 2009-10, our semi-finished iron & steel, steel bars & rods, Q: How do you promote MSMEs' global exports dropped by 19 per cent only to claw non-ferrous metals, electronic goods and competitiveness? back in 2010-11. I am fairly certain as trade project exports. Catering to MSME (Micro, Small, Medium En- revives, so would our exports. We must there- India has a well-developed and diversified terprises) is our prime responsibility since this fore use this opportunity to clean up our areas industrial machinery/capital base capable of sector requires handholding the most. Under of weaknesses, increase our competitiveness manufacturing the entire range of industrial the various market promotional assistance through better housekeeping, inventory man- machinery. The industry has also managed to schemes of the government, we participate in agement and investing in product development successfully develop advanced manufactur- several exhibitions around the world. Annually, ing technology over the years. Among the we hold anything between 30 to 40 exhibitions developing countries, India is a major exporter catering to 34 engineering segments that we of heavy and light engineering goods, pro- deal with. We also have our brand INDEE, rep- ducing a wide range of items. The bulk of resenting the wide range of general engineer- capital goods required for power projects, ing segments, which we hold abroad and the fertiliser, cement, steel and petrochemical recently launched India Engineering Sourcing plants and mining equipment are made in Show (IESS), the second edition of which will India. The country also produces construction be held in Mumbai in March 2013. machinery, equipment for irrigation projects, diesel engines, tractors, transport vehicles, Q: Has India developed indigenous ex- cotton textile and sugar mill machinery. The pertise in automotive engineering? engineering sector has been growing, driven Yes, certainly. Auto and auto components by growth in end user industries. accounted for 17-18 per cent of India’s total engineering exports in the last couple of years and are a frontline exporting segment. Accord- ing to the Automotive Mission Plan 2006-2016, Aman Chadha the automotive industry is expected to make Chairman, EEPC India up 10.4 per cent of the Indian GDP by 2016.

www.ibef.org august-september 2012 19 cover story India’s Engineering Strides

nation-building that stipulate high tute’s (TERI) National Energy Map of the energy sector needs to augment its capacity creation in core sectors like India: Technology Vision 2030, India’s capacity. Capacity addition for power infrastructure, power, mining, oil and commercial energy requirement in the generation increased to 10,210 MW in gas, steel, automotives and consumer BAU (business as usual) scenario is FY11. India’s expertise in production of durables, have ensured a high and estimated to increase 7.5 times over a electrical machinery and equipment steady demand for engineering goods. 30-year period from 2001-2031 from a is world renowned. The International Additionally, India with a comparative level of 285 MTOE (million tonnes of Yearbook of Industrial Statistics 2010 of advantage in manufacturing costs due oil equivalent) in 2001 to 2,123 MTOE the United Nations Industrial Develop- to lower design, research and labour in 2031. India’s energy requirement ment Organisation (UNIDO) ranked costs, economies of scale and availabil- increased at a CAGR of 7.1 per cent to India among the top 10 markets world- ity of skilled manpower, is expanding 830.6 billion units in FY10 from 631.6 wide in terms of production of electrical and strengthening its backbone of billion units in FY06. The primary machinery and equipment. engineering. energy consumption increased at a India has an installed capacity of over CAGR of 8.3 per cent from 381.4 MTOE 18,000 MW per annum for manufac- Empowering Power to 524.2 MTOE during the same peri- turing steam, hydro and industrial A primary growth driver for engineer- od. The International Energy Agency turbines. In FY11, India exported ing, the power sector in India, is on estimates that India will add 600 -1200 `49,252.6 crore (US$ 8.9 billion) a high growth trajectory, pushing the GW of additional power generating worth of nuclear reactors, boilers, demand for engineering goods. Accord- capacity by 2050. machinery and mechanical appliances, ing to The Energy And Resources Insti- To fulfil the burgeoning demand, registering a year-on-year growth rate of

Window of Opportunities MSV-Brno International Engineering Fair being held in the Czech Republic will provide India the platform to showcase its engineering strength. As the Partner Country, Brand India will hold centre stage in a field where it has proved its mettle.

India is participating as the partner country at the MSV International fair provides the right pitch. Central Europe is doing quite well eco- Engineering Fair at Brno Exhibition Centre, Brno, the Czech Republic, nomically. The Czech Republic has been a predominantly engineering- from September 10-14, 2012. The Czech Republic is the gateway based economy. India imports a lot of Czech machinery. Says Aman to Central and East European markets. MSV-International Engineer- Chadha, Chairman, EEPC India, “It is now how we improve our rela- ing Fair is a leading industrial trade fair in Central Europe offering a tionship to become mutually beneficial. With the technology between platform for concurrent presence of key domains of the manufacturing the two countries and the cost advantage that India has, together we industry. Organised by BVV Trade Fairs Brno, the Show marks the should get into more joint ventures. I hope this exhibition will open presence of top of the line exhibitors and visitors from across Europe the doors for more foreign investment from the Czech Republic. It will and provides an opportunity for new business contacts, investment be a win-win situation for both the parties: a) they can produce their decisions, knowledge transfer, etc. The 2012 Show is the 54th edition products at a lower cost and compete with other countries; b) they of the event. Close to 150 companies from small, medium and large have a readymade captive market in India and; c) a lot of machinery is sectors will be participating from India to explore potential opportuni- required in India that we don't manufacture and import. Hence import ties. The show will also facilitate joint ventures, technology transfer, substitution will also happen.” marketing arrangements as well as people-to-people contact between Central Europe in general and the Czech Republic in particular offer the two countries. immense opportunities for bilateral trade ties. In fact, India enjoys a The India Show will present Brand India Engineering to the discern- Double Taxation Avoidance Agreement with the Czech Republic. ing audience of Central Europe. Engineering in India is on the upswing MSV-Brno 2012 will also offer Indian exhibitors opportunities to and as we look towards new markets a high profile event like the Brno showcase their products at thematic exhibitions running concurrently.

20 august-september 2012 www.ibef.org India’s Engineering Strides cover story

24.7 per cent. Exports of transformers 70–75 billion) by FY22. The transform- funds, and a comprehensive policy for and switchgears have increased at a ers market is estimated to be worth developing public-private partnership CAGR of 27 per cent and 28 per cent, `61338.6 crore (US$ 11.1)billion growing projects. The government further respectively. at a CAGR of 13.7 per cent between FY11 enhanced the tax-free bond limit to The Indian electrical machinery and and FY22. `166,020 crore (US$ 30 billion) in equipment industry grew at a CAGR FY 2012–13. It has also established of 24 per cent between 2008 and 2010 Infrastructure Boom an infrastructure debt fund worth and generated revenues to the tune The infrastructure index comprises `9,961.2 crore (US$ 1.8 billion). of `133,922.8 crore (US$ 24.2 billion) industries in sectors such as electricity, (Source: Invest India). in FY10, according to estimates of the coal, cement, steel, crude and petro- Surface transport is one of the pri- Department of Heavy Industry, Govern- leum refinery products. The index rose mary segments in the infrastructure ment of India (GOI). It forecasts that to 261.8 in FY11 at a growth rate of 4.6 sector. The growing emphasis on this the domestic market for generation per cent over FY10. The government is sector in India is driving growth in the equipment such as boilers, turbines, providing a fillip to the infrastructure engineering industry. The government generators, etc., will expand to `138,350– sector through various policy measures has allocated a fund of `24,000 crore 166,020 crore (US$ 25–30 billion) at a and incentives. In FY 2011-12, the gov- (US$ 4 billion) for the development CAGR of 16 per cent. The Transmission ernment allocated funds worth `257,331 of rural road projects in FY 2012-13. & Distribution (T&D) Equipment Indus- crore (US$ 46.5 billion) to the sector, During the 11th Five Year Plan period, try is expected to expand at a CAGR of 14 tax-free bonds worth India added 5,345 Km (as of 2011) to per cent to `387,380-415,050 crore (US$ `35,971 crore (US$ 6.5 billion) and debt its highways. The Ministry of Road

The 8th International Machine Tools Exhibition is a and tools. platform where Indian participants with technology MSV-Brno is expected to benefit the and manufacturing expertise can woo the Euro- Micro, Small and Medium Enterprises pean companies. India’s machine tools portfolio (MSMEs) of both the countries with tech- is vast and varied. The 14th International Foundry nology transfer, tie-ups and new markets. Fair, 21st International Welding Engineering Fair, Science and technology will benefit as 4th International Surface Technology Fair and the India and the Czech Republic have a 3rd International Plastics, Rubber and Composites cooperation agreement which includes Fair will together provide a varied but focussed biotechnology, nanotechnology and life platform for showcasing India’s engineering talent. sciences in its ambit. The heavy engineer- The larger MSV-Brno Fair focus will be on ing industry in India will find opportunities materials and components for mechanical engi- in machine, engineering, mining, heavy neering, machine tools, forming tools, precision and general machine building iron and and hand operated tools, mining, metallurgical steel products, metal working electronics and ceramic glass engineering, drives, hydraulics and transport equipment. and pneumatics, cooling and air conditioning The Czech Republic is a traditional technology, electronics, automation, measuring tea-drinking nation and offers immense technology, heavy current electrical engineering, potential for export of tea. Opportunities plastics, rubber and chemical engineering among for state governments to collaborate in other things. various fields to bring in investment and India’s thrust areas at the show include equip- the Indian Railways can also be explored. ment, machinery, automotive parts and trailers The MSV-Brno Fair, in short, is a vital step and transportation, basic iron and steel, equip- in India’s long-term trade relationship with ment and tools for agriculture and forestry, rolled the Czech Republic—the window to the and drawn products of iron and steel, machinery vast untapped potential of central Europe. and parts for metallurgy and electrical machinery

www.ibef.org august-september 2012 21 cover story India’s Engineering Strides

2010-11. According to an IMaCS (ICRA Management Consulting Services) report, the industry contributes 12 per cent to the total manufacturing activity, which is about 15 per cent of the coun- try’s gross domestic product (GDP). In “It's Brand FY11, the Planning Commission valued the capital goods and engineering India Now” sector at about `383,094.4 crore (US$ 69,225.6 million). Gunit S Rana, Managing Director, The cumulative FDI inflows into the Gripwell shares his insights on the engineering industry in FY10-11 stood at `61,980.8 crore (US$ 11.2 billion) with Indian engineering industry and Gunit S Rana his expectations from MSV-Brno in Managing Director, international players such as Cum- which Gripwell is participating. Gripwell India mins, Asea Brown Bovari (ABB) and Alfa Laval entering the fray. The indus- try also witnessed a rise in merger and ------Gripwell India has seen the history of pean manufacturers who have chosen to acquisition (M&A) activities with play- India unfolding. Established in 1948, in move production to developing countries, ers like Diamond Power Infrastructure November 2011, it completed 63 years of in their own design & brands. At Gripwell, Ltd, Gaji Mercantile, Yash Birla Group an eventful existence, a period which saw it we are producing tools for some renowned HBL Power Systems, etc., forging emerge as a reputable name in hand tools. international brands, with technical input tie-ups. The government, meanwhile, Gripwell is exporting to all major markets and collaboration from them. Having said has been developing several special all over the world with its own office and that, a large quantity of Indian tools are sold economic zones (SEZ) across the warehouse in Australia. at ‘opening price points’ and as promotional country to provide the right impetus The engineering export industry of India products, where the emphasis is more on to the engineering industry. The Delhi has come a long way since Gripwell first price than on quality. Mumbai Industrial Corridor (DMIC) is explored the Middle East Markets in the As from any other exhibition that Gripwell another step in this direction which is early 1960’s. The past 15 years have been takes part in, our expectations from the sure to boost the sector further. especially significant in terms of improve- International Engineering Fair, Brno, are to There are also over 100 clusters in ments in quality, production, packaging establish new contacts and hopefully make India that are hubs of engineering as well as in the a global perception of the new customers. For us: activity. The prominent among them India brand image. Speaking particularly One new customer = Good Show are located at Chennai, Faridabad, Gur- for the hand tool sector, there has been Two new customers = Great Show gaon, Jamshedpur, Bengaluru, Nagpur, tremendous improvement in product qual- We will also be looking at the possibility Tiruchirapalli, Ghaziabad and Bhopal. ity, finish, packaging, deliveries and service. of productions and technical collabora- India has a good image and our products tions, with buy back arrangements and are The Build are well accepted all over the world. Indian open to possible collaboration across the The largest in India, the engineering factories are today producing tools as engineering spectrum with companies keen industry is vast and diverse. However, ‘original equipment’ for American & Euro- to move their production out of Europe. it can broadly be categorised into heavy and light engineering sectors. The Indian engineering industry has the Transport is now in the process of roll- goods industry is de-licenced and 100 distinction of producing almost all ing out projects worth `664,080 crore per cent Foreign Direct Investment major capital goods domestically. (US$ 120 billion) by 2016 with a view (FDI) is permitted in the sector. The The heavy engineering industry to attract foreign investors to its ambi- government has removed tariff protec- accounts for a majority of the goods tious highways building programme. tion on capital goods and has reduced produced in India, and is the bench- customs duty on a range of equipment. mark of high-end, high-quality prod- Policy Push The reforms have led to improved ucts. The technology competencies The Government of India provides performance of the industry, making involved and the capital investments a strong policy framework to the it internationally competitive. Conse- required are very high and hence engineering industry through various quently, India’s capital goods industry this segment is less fragmented. The initiatives. The engineering and capital grew at a CAGR of 14 per cent in FY heavy engineering segment comprises

22 august-september 2012 www.ibef.org India’s Engineering Strides cover story

heavy electrical, heavy engineering and machine tools and automotive sectors. Auto Component Market

Heavy Bolt in India 113.0 The heavy electrical and engineering 120.0 66.3 goods segments are the key contribu- 100.0 Turnover (US$ billion) tors to the capital goods sector. In FY11, 39.9 the heavy electrical and power equip- 80.0 ment sector contributed almost 40 per 30.1 60.0 cent to the capital goods sector, while 23.0 engineering goods contributed about 40.0 37 per cent. The Planning Commission 26.5 20.0 of India expects that the production 0 of capital goods will grow at a CAGR FY2008 FY2009 FY2010 FY2011 FY2015 FY2021 of 16.8 per cent to take the sector to Electrical `6,81,000 crore (Source: Firstcall Equipment, parts, 9% Research). 10% India has the capability to manufac- Others, 7% ture boilers, one of the key segments of the heavy electrical engineering Engine parts, 31% sector, with super critical parameters Suspension & of up to 1000 MW unit size. Secretariat braking parts, for Industrial Assistance (SIA) valued 12% the boiler segment at `19,893.6 crore (US$ 3.6 billion), clocking a CAGR Source: Automotive Component Manufacturers of 29.5 per cent between FY09 and Body and Association of India; ImaCS Research FY11. The FDI inflows into boilers and chassis, 12% steam generating plants surged by Drive transmission & 318 per cent at `231.3 crore (US$ 41.8 steering parts, 19% million) in March 2012 from `55.34 crore (US$ 10 million) in March 2011. `13,281.6 crore (US$ 2.4 billion) in tries by providing the basic machinery The Department of Heavy Industry March 2011. that determines the industry’s com- forecasts that the domestic market for The technological advancements in petitiveness. It ranked 7th in machine generation equipment such as boilers, the heavy electrical sector have ensured tool consumption spending at `13,835 turbines and generators will expand to that Indian goods keep abreast with crore (US$ 2.5 billion) in FY12 clocking `138,650–166,020 crore (US$ 25–30 global trends. In the key heavy electri- a year-on-year growth of 15.4 per cent. billion), at a CAGR of 16 per cent. cal segment of switchgear and control The production jumped to 18.6 per cent The expertise of India’s heavy gear, the industry has smoothly shifted to reach `4,981.7 crore (US$ 900.2 mil- electrical engineering extends to the production from conventional relays to lion) in FY12, up from `4,402.8 crore manufacture of high value turbines and digital relays. The Department of Heavy (US$ 795.6 million) in FY11. What is generator sets of up to 7,000 MW per Industry estimates the switchgear amazing is that the top 20 players con- annum capacity. AC generator manu- market to be approximately at `45,378.8 tribute a whopping 70 per cent of the facturers in India produce generators crore (US$ 8.2 billion) by FY22, grow- total industry turnover. Machine tools ranging from 0.5 KVA to 25,000 KVA ing at a CAGR of 13.7 per cent. exports also surged ahead to `208.6 and above. The SIA valued the electric crore (US$ 37.7 million) in FY12, up generators segment at `3,010 crore Heavy Engineering, High Value from `164.9 crore (US$ 29.8 million) (US$ 540.3 million) in FY11, which grew Machine tools, textile machinery, in FY11, a notable year-on-year growth at a CAGR of 20.5 per cent between cement machinery, sugar, rubber, met- of 32.7 per cent. FY09 and FY11. allurgical, mining and dairy machinery Indian Machine Tools Manufacturers Foreign Direct Investment (FDI) and material handling equipment Association (IMTMA) forecasts that in the electrical equipment sector make up the key segments of the heavy the Indian machine tools industry will increased 27 per cent to `15,495.2 crore engineering sector. The machine tools register a spectacular CAGR of 15 per (US$ 2.8 billion) in March 2012 from segment underpins all the other indus- cent during FY12-17. Domestic demand

www.ibef.org august-sep- 23 cover story India’s Engineering Strides

of nearly `13,835 crore (US$ 2.5 billion) and are expected to reach `11,068 is projected to grow by an imposing crore (US$ 2 billion) over the entire 30 per cent over FY13, according to fiscal. The locomotive equipment Bright IMTMA. India is expected to be among industry in India is set to get a boost the top 10 global producers of machine with the commissioning of a new tools by FY17, up from the 13th position rail coach manufacturing facility in Outlook in FY 12, while the share of exports is Palakkad, Kerala, by 2015. The other Eastman Impex Managing expected to rise to 20 per cent of the two coach factories are located in Director, Jagdeep Singal total production by FY17, up from 4.2 Kapurthala and Chennai. Apart from shares his views on automotive per cent in FY12. these India has three locomotive, engineering exports The textile machinery industry and two railway wheels and axels comprises more than 600 units factories. In FY11, India exported Jagdeep Singal manufacturing complete machinery `423.3 crore (US$ 76.5 million) Managing Director, Eastman Impex and over 850 units that produce parts worth of railway locomotives, fixtures and accessories. According to Textile and parts, registering a year-on-year Machinery Manufacturers Association growth rate of 105.8 per cent. (TMMA), the textile machinery indus- The material handling equipment try received a capital investment of sector has nearly 50 organised play- about `8,301 crore (US$ 1.5 billion) and ers manufacturing a range of equip- had an installed capacity of `9961.2 ment like coal, ore and ash handling Eastman Impex was incepted in 1996 and crore (US$ 1.8 billion) in FY11. Textile plants. The industry’s exports stood since then has become one of the most machinery exports in FY11 were valued at `2,219.1 crore (US$ 401 million) respectable and trusted suppliers to the global at `797.95 crore (US$ 144.4 million). during FY10. In the case of sugar market of auto parts and light engineering India accounts for almost 20 per cent machinery, domestic manufacturers goods. The company has enjoyed a steady of the world’s spindleage and 42 per hold the sway in the global space and stable annual growth rate and the group’s cent of the world’s loomage. As per and are manufacturing state-of-the- annual turnover during the financial year 2010- Department of Heavy Industry esti- art sugar plants that have crushing 11 was of `360.49 crore (US$ 65 million). Its mates, the textile machinery industry capacities of up to 10,000 tonnes/ clients include Mercedes-Benz, Cummins, registered a CAGR of 15 per cent over day. Net exports from the industrial Caterpillar, John Deere, Fiat, Volkswagen and 2008-2011. machinery sector are expected to General Motors. Managing Director Jagdeep reach `107,580.9 crore (US$ 19.44 Singal says that 'Made in India' established its Aiming for the Skies billion) by FY14. mark on the globe for its quality benchmark. India has been diligently building “We have implemented QMS standards and its capacity in the aeronautics space. In Auto Mode have updated technology in our plants that According to a Frost & Sullivan esti- With one of the largest and fastest make our infrastructure a preferred source mate, the Indian aerospace industry, growing automotive industries in the for all global OEMs.” Eastman’s major export worth `11549.34 crore (US$ 2.09 world, India with an annual produc- markets, says Singal, are in Europe. “We billion) in 2010, would clock a CAGR tion of about 11 million vehicles a are exporting to Germany, Hungary, Poland, of around 16 per cent over 2010–2015. year, is ranked among the top 10 in Ireland and the UK, besides the USA, Brazil Bharat Earth Movers Limited (BEML), the passenger car and commercial and Mexico.” The share of automotives in a central government owned entity, is vehicle industry globally, and is Eastman’s export basket is 35 per cent. Singal setting up a new aerospace complex to among the top five exporters in Asia. says, “R&D and the ability to provide complete manufacture aircraft components and The forecasts for the sector are buoy- engineering solutions makes our company assemble helicopters and small jets. ant. The Society of Indian Automo- stand at par with other global companies. Also, Hindustan Aeronautics Limited (HAL) bile Manufacturers (SIAM) predicts our work force is dynamic, always ready to is India’s leading aircraft manufacturer, that annual vehicle sales will increase meet customer requirement consistently.” while Tata Advanced Materials is the to five million by 2015 and over nine The outlook for the coming year in the auto- largest manufacturer of personnel million by 2020. The industry boasts motive engineering sector is very promising, armour products and exporter of com- of international players such as Ford, Singal forecasts. Talking about the MSV Brno posite parts for spacecraft and aircraft. Hyundai, Renault, Nissan and BMW, Fair, Singal says, “We will be looking out for As per ASSOCHAM, aerospace and Audi, Fiat, General Motors, Mercedes possibilities like joint ventures, buy back, and defence exports grew by 18 per cent Benz, Skoda and Volkswagen. technology tie-ups for increasing our growth.” during the first three quarters of FY12 There are three automobile and

24 august-september 2012 www.ibef.org India’s Engineering Strides cover story

component clusters in Tamil Nadu, major Indian tractor manufacturer, seed de-linting in cotton, rolling mills, Maharashtra and Haryana that account exports TAFE and Massey Ferguson and cutting and peeling sugarcane. for 60 per cent of the country’s auto- brands of tractors. VST Tillers export to motive exports. According to SME Asia, Middle East, Europe and the US. Light Engineering, Heavy Demand Rating Agency of India Limited, the Several foreign companies have The light engineering industry in India Indian auto component industry offers entered into dealership arrangements straddles a vast segment manufactur- distinct cost and quality advantages to with Indian companies. As of February ing a variety of goods that are essential original equipment manufacturers. 2011, 89 patent applications had been inputs in the capital goods/heavy engi- The competitive cost advantages of up filed for irrigation; 72 for plant growth neering industries. The demand for to 25-30 per cent accrue mainly due related machinery and 232 for post- light engineering industry products is to the availability of low cost labour, harvest processing. Twenty patents have hence dependent on the growth of the skilled manpower, availability of raw been granted for irrigation, 42 for plant principal end-user segments such as material and quality control. The Indi- growth related machinery and 80 for power, automotive, electrical, mining, an auto components industry produces post-harvest processing. Innovations oil and gas, etc. The industry is labour around 20,000 different automotive in irrigation relate to micro-irrigation, intensive and employs a large number components. It is no wonder then, that drippers, sprinklers, emitters and hoses of skilled and semi-skilled workers. The India is the destination of choice for and automation in irrigation. Plant sub segments of this industry include more than 500 global players. The auto growth machinery innovations include roller bearing industry, welding equip- components industry is a preferred multi-row planters, multi-purpose farm ment and consumables, medical and destination for investors, attracting weeding, levelling and sowing equip- surgical equipment, ferrous casting, capital investments of `66,891 crore ment, and hydroponics based green- process control instruments, seam- (US$ 12.0 billion) in FY11 (21.0 per cent house application. Post-harvest innova- less steel pipes and tubes, electrical CAGR during FY05–11). tions include mechanised uniform resistance welded steel pipes and tubes, The sector grew at a CAGR of 14.6 spreading of tea leaves, technology for submerged arcs, welded pipes, indus- per cent between FY07 and FY11, while exports grew at a CAGR of 11 per cent. India exports auto components to Europe, North America and Asia, and Thrust Product-Export is now looking at Africa and South America as new markets. from India to Czech (2010) The auto components industry is set to continue its growth trajectory, with turnover expected to increase at a high Electric Power Machinery CAGR of 11.0 per cent to `625,342 crore Automobile and Automobile (US$ 113.0 billion) during FY11–21. Components The outlook for exports, expected to 50 Iron & Steel, Steel Products Machinery expand at a CAGR of 18.8 per cent over 45 Instruments FY11–21, is also positive. Electric and Home Appliances FY13 is expected to be a windfall year 40 Castings for the industry with growth projected Machine Tools Small and Cutting Tools at 8.0–10.0 per cent and exports likely to rise 15.0 per cent. 30 Agriculture In the agricultural equipment seg- 20 ment, the Indian tractor industry is the 20 18 world’s largest and accounts for one- third of global production. More than 250,000 tractors are manufactured 10 6 every year by 13 manufacturers. Mahin- 3 4 dra & Mahindra, a leading tractor 1 1 1 1 2 manufacturer in India, exports tractors 0 to the US and Europe. TAFE, another

www.ibef.org august-september 2012 25 cover story India’s Engineering Strides

is expected to be worth `24,958.3 crore (US$ 4.51 billion) by 2016, and is expected to grow at a CAGR of 5.6 per cent over 2010–2016. In FY10, Frost & Sullivan estimated the process “Drastic Change in transmitters market at `931.9 crore (US$ 168.4 million) and projected that the market would grow at a CAGR Manufacturing” greater than 13 per cent until FY16. The CD Shah, Chairman & Managing Director, VNS Switchgear, expertise of Indian manufacturers is speaks of the cutting-edge changes in Indian engineering. such that more than 25 per cent of the Indian manufacturers can implement the entire instrumentation system, VNS Switchgear was incepted in the year 2004. The company including the software required by is a joint venture between S-Team Switchgear Private Limited, process industries. Singapore and Nylex Group of India. VNS manufactures and exports earthing accessories, control panel boards, digital Robust Future panel meters, test terminal blocks and others as per specific The success story of the engineering standards. Its export hubs include Italy, Bahrain, UAE, Brazil, industry in India is cast in steel. India Jordan, Sri Lanka, Singapore, Malaysia etc. The product is the fourth largest producer of steel. portfolio comprises control panels, metal enclosures, cable Now its steel industrialists are expand- trays, cable ducts and metal components. Chairman and CD Shah ing their global footprints with Tata Chairman & Managing Managing Director, CD Shah, says, “We export at least three to Director, VNS Switchgear acquiring the Corus Group and Mittal four containers a month.” Steel acquiring Arcelor. Jindal Steel and Shah says that India has seen a drastic change in terms of Power Limited was ranked the second manufacturing. “The new-age machines and technologies have highest value creator in the world by improved our capability in manufacturing of quality engineering Boston Consulting Group (BCG) in goods. Today, India is exporting to several developed countries, September 2010. The company also while many foreign companies have invested in India. The received the Forbes Asia's 'Fabulous 50' country is turning into a major manufacturing facility hub and international award in the same year. this proves that we have really made our mark on the globe.” India also has the fifth largest bauxite Shah has positive expectations from the MSV-Brno Fair reserve in the world. and is confident of “our quality products” attracting the right Besides natural reserves, the country attention. has a reservoir of skilled manpower which makes the industry internation- ally competitive. Nearly 95 per cent of trial fasteners, steel forging, bicycle, crore (US$ 6.5 billion). Meanwhile, the Indian manufacturers are either ISO etc. (source: business.gov.in) medical technology industry in India certified or seeking certification and is slated to grow from `14,941.8 crore comply with international standards Medical Miracle (US$ 2.7 billion) in 2008 to ` 77,476 such as Quality Management Systems India is the fourth-largest market in crore (US$ 14 billion) by 2020, accord- (ISO 9001), Environmental Manage- Asia and is among the global top 20 ing to PricewaterhouseCoopers (PwC). ment Systems (ISO 14001), Occupa- markets for medical equipment and India is among the top five preferred tional Health & Safety Management supplies. According to KPMG, the sources for syringes, needles, IV cannu- Systems (OHSAS 18001) and Total medical devices market in India, which lae/catheters, contraceptives, surgical Quality Management (TQM). The gov- was worth`14,367.6 crore (US$ 2.6 bil- blades and gloves. As of 2012, India's ernment too is doing its best to provide lion) in 2011, is set to expand at a CAGR medical device industry was valued at a sustaining environment for the indus- of 13.4 per cent between 2011 and 2016, about `16,602 crore (US$ 3 billion), try’s continued growth. India certainly to reach `27,670 crore (US$ 5 billion). with a projected growth rate of 12-16 per has engineered a bright future. Deloitte estimates that the medical cent over the next five years. electronics industry will witness a (Sources: Brand Engineering Facts-Aranca; The greater than six-fold expansion between Precision Control Engineering Industry Factbook-June 2012, IMaCS; 2010 and 2020 to reach around `35,971 The process control market in India SME Rating Agency Limited)

26 august-september 2012 www.ibef.org

Emerging Entrepreneurs Commonfloors

ow many floors are there become a single platform for all apart- and gated communities” evolved literally in your skyscraper? ment stakeholders, make sure everyone from ground zero, the garage, where Which floor do you live is on the same floor—owners, tenants, Sumit and his core team of IITians— on? Who else lives on association members, buyers, sellers, Lalit Mangal, Rahul Gupta, Manoj Singh, your floor? Who is your property managers. “It is a common Mukesh Ghatiya (all IIT Roorkee alum- Hnext door neighbour? Do you know any channel through which people can com- ni) and Vikas Malpani (computer science one on the floor below or above yours? municate,” Jain explains the idea behind graduate from VTU Belgaum)—set out To the chagrin of most apartment dwell- his company. But before slotting Com- to build this unique company, brick by ers, after definitive answers to the first monfloor into the genre of a property brick, in 2007. They were all barely 23 two, nobody generally has any clue to dealer, pause a while—it is the sum of and knew nothing about business or the rest. So when I fired my first salvo at all the bits and pieces that make up the management. What they had in plenty 27-year-old at Sumit Jain, Chief Executive property market and residents’ commu- was the audacious confidence of youth. Officer of Commonfloor.com: “What is nity needs. Sumit calls it a 360 degree ‘uncommon’ in Commonfloor?”, the very holistic approach to apartment dwelling. Building Blocks commonality of the concept threw me. Ironically, the idea for India’s “first real At that time, apartments and gated com- The basic idea of Commonfloor was to estate portal dedicated to apartments munities were coming up in a big way

28 august-september 2012 www.ibef.org Commonfloors Emerging Entrepreneurs

Forommon a ause A humane thought prompts a group of Ctechies to build a common platform on an uncommon idea—using technology to promote human connect among apartment dwellers. By Sangita thakur varma

as an alternative way of living in large you to the community residing within proposition of Commonfloor lies in cities. But the Indian middle classes, the gated complex to managing the delivering all the various services in a used to living in close knit mohalla (col- gated communities’ needs. Today, it cohesive manner on a single platform. ony) communities, did not know how to has the vastest registered communities’ “Many other companies in the space perpetuate the same community living base, maximum listings and is India’s can help you find a house and you concept amid largely unknown groups largest apartment portal. can create groups on any social media of apartment dwellers. The result was a network,” explains Sumit, adding, “But rapidly isolated family ‘gated’ behind its Delivering Difference nobody delivers complete value.” The own doorway. “Commonfloor does not intend to create concept surprisingly has its root in Commonfloor chose to break this any competition or kill any competition. the cultural fabric of India and is not a mould. It was a concept that rose above What we are doing is entirely different,” western import. “There was a company the conventional buy-sell-rent property says Jain. The budding entrepreneurs in the West doing something similar portal and became a one-stop solution have a simple vision inspired by their but we found out much later,” says for all residential needs—right from own homely backgrounds. “We intend Sumit. It also failed to garner much finding an apartment to suit your to build a one-destination portal popular interest in western society, he

requirements and budget to connecting around homes,” he states. The value adds. Indians are by nature social and Photogra p hs by S RA D HA K R I SH N A

www.ibef.org august-september 2012 29 Emerging Entrepreneurs Commonfloors

seek company. But rapid urbanisation has somehow impacted this urge, says Jain. “People now only come together if there is an issue against the builder or some sewage problem in the build- ing or water shortage.” Commonfloor understands people’s inherent need to connect while at the same time respect- ing their requirements of space.

Technology that Binds The techies together developed propri- etary software calling it Apartment Man- agement Software (AMS), which looks at an apartment as a domain and delivers services such as accounting, property management, vendor management, etc. Marketing the technology in its simplest form in 2007, they have worked closely Apartment Management Software is a with communities to add value to their private system and every apartment services, and won their trust, says Jain. Explaining the working of the system, community has a private Commonfloor Jain says, “A plethora of issues are filed only visible to members of that forum. by residents that need immediate atten- tion. To the office-bearer, say president of a Resident Welfare Association, hard security, modular kitchen, maid service, quarter in terms of revenue since the last pressed for time, our technology allows direct to home, etc. This can be done two quarters. The traffic in the last five to see at a glance what issue is being through groups or RWAs that can bar- years has doubled too. In fact, Jain says, faced by perhaps 20 flat owners. It helps gain for discounts with vendors. Com- “We were 20-people team five months take collective action, call in a vendor and monfloor has a vendor connect feature back; we are 150-people team now. In fix the problem.” The feature rich apart- to facilitate this. A property maintenance terms of revenue also, earlier we used to ment management software is fast gain- feature on Commonfloor assists RWAs grow 250 per cent annually, but now it ing currency and its popularity can be in their various functions. is more than 100 per cent every quarter, gauged from the fact that in Delhi alone Discussing the software that propels all and we should continue it for at least more than 1,000 RWAs are using it. this, Jain says, “The technology behind three-four quarters.” For those looking for an apartment AMS is Lampspec—using a Linux And the beauty of Commonfloor is or property, Commonfloor is an ideal operating system, an apache web server, its simple revenue model. “We believe place to start. It has research processes MySQL database and PHP language. business is a byproduct of the usage and online forums to help arrive at an It is a multitier architecture.” AMS is and we promote infomercials or the informed decision. A prospective buyer a private system and every apartment lead-connect model,” says Jain. Hence, just needs to spend some time brows- community has a private commonfloor Commonfloor services are free for users ing through the articles, taking advice that is only visible to people who are part but vendors are charged a fee for con- and looking at potential property and of that forum. “Our tagline is ‘Window necting them to users. Their database projects, shortlist viable ones and discuss to your neighbourhood’, so if you are of almost 40,000 gated communities them with buyers in forums. Once a sitting inside, you can see your neigh- is invaluable for business. But finally, decision has been taken, the price can bourhood and if you are outside, you can the young technopreneurs are aiming be negotiated with the builder (Com- actually talk to an apartment,” explains for a humane vision of society: “We like monfloor does not assist in this). A new Jain. The startup already has a presence decoding because we are engineers. But property owner then joins the group in 120 cities and has 35,000 listed com- we feel technology should be for the of owners on Commonfloor and thus munities. “We are very confident about layman. Commonfloor enables bonding a community is formed, bringing in our future. We have sufficient funds for offline. That is the real impact,” says Jain. bargaining power. For services, residents the next two years,” says Sumit. Com- Commonfloor will certainly find many of put out notices on Commonfloor, say for monfloor is growing at 100 per cent each the high-rise crowd on the same page.

30 august-september 2012 www.ibef.org

Features Inside Computer Peripherals: Government provides a coordinated push Pg 35

Gems & Jewellery: It’s Sectoral shining bright with designs a cut above the rest Pg 38

Handloom Exports: An industry that weaves its unique story of update tradition and modern Pg 41 he cement sector in India has been one consistent player. In fact, India is the second largest producer of and market for cement in Tthe world after China. At the end of FY 10-11, the cement industry, with a pro- duction capacity of 323 million tonnes (MT), had already outpaced major industries in the country’s growth story. As per the estimates of the Cement Manufacturers Association (CMA), by 2020, cement production is slated to almost double to 550 MT. According to the Confederation of Indian Indus- tries (CII), cement is among the fastest growing sectors in India. The produc- tion capacity of the sector grew by more than 40 per cent in the last five years. Industry watchers estimate that in the next three years the sector will grow more than 35 per cent. In 2011, there were approximately 137 large and 365 mini cement plants producing differ- ent varieties of cement.

Wide Variety

PHOTOs: photo s.c o m India’s cement industry is not just Cement vast but also varied. It is recognised the worldover for the different types of cement that it manufactures—all with Cementing the Indian hallmark of quality, that is the Bureau of Indian Standards (BIS). The Indian cement industry thus caters Growth to all segments with its vast portman- teau of products. Ordinary Portland Cement: The most Led by the infrastructure and housing important type of cement earlier, OPC as it is known, is further classified into boom, the cement industry eyes three categories—33 Grade, 43Grade Sangita Thakur Varma and 53Grade. OPC is not used to that double digit growth. extent today and has been overtaken by

32 august-september 2012 www.ibef.org Cement sectoral update

Portland Pozzolana Cement (PPC). housing, accounting for 60-70 per cent up the value chain. The importance Rapid Hardening Cement: As the of the total domestic demand; infra- of the domestic housing sector as the name implies, this type hardens structure for 17 per cent; commercial primary consumer of cement cannot be rapidly and also develops high construction for 11 per cent; and the overemphasised. India boasts of one of strength at an earlier stage than OPC. industrial sector for 9 per cent of the the fastest growing real estate markets It is used primarily in pre-fabricated total demand. Currently, real estate in the world. The FY12-13 Budget took concrete construction works and in and infrastructure are the two principal concrete measures to create adequate road repair. sectors driving the industry’s journey funding mechanisms and provide a Sulphate Resisting Cement: It has further boost to the sector. an advantage over other types due to Under the 12th Five Year Plan (2012- its resistance to sulphate and finds 2017), the total projected infrastructure wide use in construction work done Investment investment is `40,99,240 (US$ 740.74 in marine conditions, foundations Destination billion). The estimated construction beneath soil containing sulphate com- opportunity in the 12th Plan period pounds and sewage treatment works. Housing Boom: All the current under various airports, roads and Portland Slag Cement: Portland cement economic indices are favourable for highways, ports, and power projects is and Ground Granulated Blast Slag are a high octane growth in the cement worth `553,000 crore (US$ 1 trillion). mixed to obtain this type, which is resis- sector. Increasing per capita income, The demand for cement is likely to tant to chemical attacks. It finds usage nuclear families, rapid urbanisation and keep the medium to long-term growth in water retaining structures or where government stimulus to various rural momentum of the sector at a steady the structure is vulnerable to any form of and affordable housing schemes will all pace of 10 per cent (ACC Annual chemical attack. promote housing needs and provide Report). In fact, the industry grew at a Super Sulphated Cement: This variety the stimulus for growth of the cement remarkable pace of 9 to 10 per cent in has a percentage of granulated slag and industry. the last decade and it is expected that a higher sulphate resistance and fine- production will grow at a CAGR of 12 ness than OPC. It is used in foundation Low Consumption: The per cent between FY 11-14 as players works (or sea works). growth potential of the industry is increase output. Portland Pozzolana Cement: PPC is immense. With the current per capita the most popular variety of cement for consumption of cement much lower Booster Dose general construction and is obtained by than the world average—it is around The Government of India, understand- mixing OPC with suitable Pozzolana at 148 kg per capita in 2012 when the ing the role that cement plays in build- a certain temperature. Pozzolana has world average stands at over 350 kg ing the economy, decontrolled the properties similar to those of cement. per capita—the field is large for both industry from price and distribution Other types being manufatured existing and new players. China leads on March 1, 1989 and on July 25, 1991, include coloured cement manufactured with the highest at 660 kg per capita it was also de-licensed. The govern- by adding pigments to OPC or PPC followed by Japan with 631 kg per ment has also adopted several policy obtained from limestone found only capita; the corresponding figure in measures that provided the impetus near Jodhpur in the country; low heat France is 447 kg. for growth like waiving custom duty cement that prevents cracks in struc- Construction Flurry: In the on non-coking coal in the Budget of ture; hydrophobic cement manu- 12th Five Year Plan, the outlay under 2012-13. Non-coking coal, one of the factured by grinding together OPC construction is estimated to go up to 9 main raw materials for cement pro- clinker with substances such as oleic per cent of the Gross Domestic Product duction, is now exempt from basic acid or stearic acid; masonry cement (GDP) amounting to approximately customs duty (earlier at 5 per cent). used in masonry works; oil well `553,000 crore (US$ 1 trillion). Currently According to Crisil, a global analytical cement used in construction of oil sized to be `19,90,800 crore (US$ 360 company providing ratings, research wells; concrete sleeper grade cement billion), the Indian construction market is and risk policy advisory services, this manufactured as per specifications set to replace Japan as the third largest, move will have a positive impact of of the Indian Railways and high alu- after China and the US, by 2020. The 1-1.5 per cent on the cement industry’s mina cement. enhanced construction activity will lead operating profit. The industry meets to double-digit growth in the cement close to one-fourth of its total coal What Drives Cement Growth? industry. requirement through imported coal. There are four key sectors in India In a major boost, the government boosting the demand for cement— has increased allocation to the infra-

www.ibef.org august-september 2012 33 sectoral update Cement

structure sector. In FY 2011-12, it allo- ogy. Continuous technological upgra- reduce energy utilisation by at least cated funds worth `257,145 crore (US$ dations and adoption of new ones have four per cent. 46.5 billion) to the sector. Other sops kept the industry from obsolescence. The industry is now keen to consoli- include tax-free bonds worth `35,945 Since cement manufacturing is highly date its green footsteps and ensure crore (US$ 6.5 billion), debt funds energy intensive, the industry players sustainable development. Confed- and a comprehensive policy to pro- are upgrading and setting up state-of- eration of Indian Industry (CII) and mote public-private partnership (PPP) the-art energy efficient plants. Plants Cement Manufacturers Association projects. The government further are running successfully with alter- (CMA) organises an annual event enhanced the tax-free bond limit to nate sources of fuel such as pet coke devoted to raise awareness towards `165,900 crore (US$ 30 billion) in FY and fuel derived from waste. India the cause. In its eighth edition, Green 2012-13 and established an infrastruc- is second only to Japan in recycling Cementech, held in May 2012, adopted ture debt fund worth `9,954 crore industrial waste generated in the several measures to speed up the Indi- (US$ 1.8 billion). manufacture of cement. The CII says an cement industry’s green makeover. Another incentive is the north- that Indian companies are already Cement manufacturers in the coun- east package, namely the North East consuming more than 50 per cent of try have to commit `1,500 crore (US$ Industrial and Investment Policy, 271.44 million) in order to turn their 2007, under which the government processes more green by 2015. Indian approved fiscal incentives and various Cement Clusters manufacturers are already following concessions to boost infrastructure The cement producing clusters in India stringent quality parameters and com- development in the region. The High- evolved due to the proximity of limestone ply with all regulatory requirements way Development Fund is an ambi- mines in the area. They are: like the Bureau of Energy Efficiency. tious programme targeted to attract Nalgonda in central Andhra foreign investors. Under it, the Minis- Pradesh Bright Outlook try of Road Transport plans to roll out Satna in Madhya Pradesh The cyclical nature of the cement projects worth `663,600 crore (US$ industry is a blessing, as any Chanderia in south Rajasthan 120 billion) by 2016 for building high- downturn is but a grey cloud that soon ways. Under the Rural Road Develop- Gulbarga in north Karnataka blows over. In fact, some industry and east Andhra Pradesh ment Plan, a fund of `24,000 crore analysts estimate that production (US$ 4.34 billion) has been allocated Jawad and Neemuch in would reach 480 MT by 2017. The Madhya Pradesh for rural road projects in FY 2012-13. reason for the positive forecast lies Keeping in view its status as a key Chandrapur in north Andhra in the low per capita consumption infrastructure element, the Govern- Pradesh and Maharashtra of cement in the country, which ment of India keeps a close watch on Bilaspur in Chattisgarh at 148 kg, is very low compared to the performance and prices of the Yerraguntla in south Andhra the world average. Seeing this vast cement industry. The constraints are Pradesh potential, while the existing majors reviewed in Infrastructure Coordina- are increasing installed capacity, new tion Committee meetings held in the players, especially transnational Cabinet Secretariat. The Committee the recyclable fly ash that is gener- companies, are all set to enter the fray. on Infrastructure also reviews the ated by the thermal power plants. The Industry players invested `50,000 industry’s performance regularly. three Rs of environment protection— crore (US$ 9.04 billion) to add reduce, reuse, recycle—are already capacities of 150 million tonnes in the In Sync with Technology being implemented in the industry as last plan (2007-12). As per projections The Indian cement industry is keep- manufacturers adopt processes utilis- in the 12th Five Year Plan, the cement ing abreast of the latest technological ing alternative energy sources like sector needs to raise its capacity to advancements in the world. It fol- municipal solid and pharma wastes. 480 MT by 2017 to meet the rising lows stringent quality control, effi- India is also inching towards becom- requirement for the commodity. An cient power and fuel consumption, ing an ideal thermal and electrical increase in capacity by 30 MT is on environment-friendly regulations and energy consumption state. It achieved the anvil by FY13, and another 22 MT latest technology. Currently, it is close energy consumption level of 667 kcal/ in FY 14. to achieving the best productivity kg clinker and 68 kWh/t cement, a (Source: Cemweeks’s India Cement Sector Senti- parameters with 93 per cent of total close second to Japan which consumes ment Survey 2012; Invest India; Cementpedia and production capacity using modern 650 kcal/kg clinker and 65 kWh/t secondary research) and eco-friendly dry-process technol- cement. The sector further aims to

34 august-september 2012 www.ibef.org Computer sectoral update

Computer Peripherals Peripherals: The Soul of IT The computer peripherals industry is riding high on the back of the ever widening IT base in India as also a slew of government incentives. Sangita Thakur Varma with Inputs from S Ojha

he computer peripher- als industry is on a high growth trajectory piggy- backing the impressive success of the Indian infor- Tmation technology industry. A sector that thrives on inventions, the periph- erals industry has witnessed stable demand as customers crave newer and better products with each anticipated launch.

Product Portfolio Input, Output and Input/Output (I/O) devices make up the computer periph- erals market. Input devices include card readers, tape readers, keyboards, digitisers and pointing devices like the mouse, the light pen, etc. Output devices comprise printers (impact and non-impact), plotters and monitors; ter- minals and auxiliary memory devices such as tape drives, disk drives and floppy drives make up the I/O devices. PHOTO: photo s.c o m

Buoyant Scenario per the Electronics and Information computer system, it is apparent that The Indian IT-BPO (Business Process Technology Annual Report 2011-12, of any growth in the parent industry has Outsourcing) industry achieved a the Ministry of Communications and a direct impact on the peripherals growth of 14.7 per cent in 2011-12 over Information Technology, Department industry. Even in the relatively new 2010-11, marking a landmark year in its of Electronics and Information Tech- field of e-tailing in India, peripherals history. The aggregate revenue notched nology, Government of India. and computer accessories contributed up by the sector in the year stood at With peripherals accounting for the highest—36 per cent amounting to `558,530 crore (US$ 101 billion), as 60-70 per cent of the total value of a `560 crore (US$ 100.9 million)—to its

www.ibef.org august-september 2012 35 sectoral update Computer

total revenues in 2011, according to the market. Digital Commerce report of Internet “The government is now giving a and Mobile Association of India. heavy thrust to domestic manufactur- The industry too is confident. Sabya- ing of computer peripherals and recent- sachi Patra, Executive Director, Manu- ly came out with the policy on Prefer- facturers’ Association of Information ential Market Access, which insists on Technology (MAIT) says “With the products with indigenous content of at rising PC penetration in India, the con- least 30 per cent,” informs Patra. Under sumer demand for computer peripher- the new rules, local value addition also als is bound to grow over the coming has to be increased from five per cent years.” Add to it the spurt in mobile every year reaching a maximum of 45 per devices like smartphones and tablets, cent over the next five years. The Nation- the PC peripherals market is all set for al Telecom Policy 2012 meanwhile will a boom, he points out. focus on strengthening indigenous And the IT hardware market in India manufacture of telecom products. continues to expand at a fast clip. The main driver for this is IT adoption Manufacturing Methodology by key sectors like telecom, banking, The domestic peripherals industry financial services and insurance, ITeS, “With the rising accounts for about 30 per cent of the education, small office/home office PC penetration production, while the remaining 70 per (SOHO), manufacturing verticals, cent is dominated by foreign players. small and medium enterprises (SMEs) in India, the Licences are issued to Indian manufac- and households. “Further, e-governance consumer turers who have licensing agreements and UID (Unique Identification) initia- for technology. India manufactures a tives of the government have given the demand for variety of computer peripherals includ- much-needed fillip to peripherals such ing dot matrix printers, line printers, as webcams,” adds Sabyasachi. computer daisy wheel printers, terminals, moni- peripherals is tors, keyboards, digitisers, magnetic Policy Push ink character recognisers (MICR), The government has geared up to bound to grow floppy disc and hard disc drives and provide the push, recognising the over the coming cartridge tape drives (CTD). Computer strategic and economic importance of peripherals manufacturing involves electronics hardware manufacturing. years.” several layers comprising assembly and The Draft National Policy on Electron- sub-assembly of various components. —Sabyasachi Patra ics (NPE), released on October 3, 2011, Executive Director, Manufacturers’ These components include plastic, elec- is a roadmap for the development of Association of Information Technology trical, mechanical, electromechanical the sector and steps are being taken (MAIT) and electronic parts. In most cases, the to attract investment in the industry. components are proprietary ensuring The NPE estimated that by 2020, longevity for the component industry the electronics systems design and The Cabinet approval of the `10,000 manufacturers. manufacturing industry will reach a crore package (US$ 1.8 billion) to pro- The rate of obsolescence in the turnover of `2219.2 crore (US$ 400 mote manufacturing in the electronic industry is extremely high given its billion). The Economic Survey released system design and manufacturing innovative character and this keeps in March 2012 had estimated that the (ESDM) sector will address the huge demand levels high. For example, electronics hardware production in the demand-supply gap and also create informs Patra, “A very high degree of country would grow by 27.6 per cent in five lakh jobs over the next five years. value addition (to the tune of 65 per 2011-12 to cross a revenue of `18,3084 The MSIPS would act as an incentive cent) has been achieved in the manu- crore (US$ 33 billion). Another spur for relocation of units from abroad. It facturing of the Dot-matrix printers. is the policy announcement regarding would make India an attractive desti- TVS electronics and WeP Peripherals, Electronic Manufacturing Clusters and nation for foreign firms for setting up the top two leaders in Dot-matrix print- Modified Special Incentive Package their R&D and manufacturing facilities. er manufacturing in India, account for Scheme (MSIPS) which was unani- The taxation benefits under MSIPS close to 70 per cent of the Dot-matrix mously welcomed by all stakeholders. will also act as a magnet to the Indian market.”

36 august-september 2012 www.ibef.org Computer sectoral update

Since the industry is still largely depen- monitors and LEDs are the next big 180.83 million). dent on imports, there is huge opportu- thing on the Indian consumers’ hori- Meanwhile, the consumer storage nity for indigenisation of manufactur- zon. market witnessed unprecedented ing and technology. With increasing In the projector market segment too, growth in 2011 at a rate of 10-15 per cent. automation of processes and assembly India is overturning popular global According to IDC, the global market and adoption of Surface Mounted Tech- market sentiments—growing at 60 per for Secure Digital (SD) Memory Cards nology (SMT) and Application Specific cent against the global trend of 20 per is expected to reach `117,789 crore ICs (ASICs), India is ready to enter the cent. In 2011, the market size of projec- (US$ 21.3 billion) by the year 2018. third phase of component evolution, so tors was around 240,000 units and it Research firm Netscribes in its Storage far dominated by Japan. is likely to cross 275,000 units in 2012 Market India 2012 Report states that with analysts expecting the market to the storage market in India will attain a Uptrend for All grow by 18 per cent annually in the next CAGR of 13 per cent during 2011-16. Computer peripherals is an excit- three years from its current level in According to Indian Market Research ing market in India with demand for 2012. The Indian motherboard market Bureau (IMRB), growth in printer sales computers rising phenomenally. The too is buoyant with market leaders like doubled in the last five years (2006-11). market is growing at a CAGR of 20-30 Foxconn achieving 200 per cent growth Laser printers saw the highest demand per cent driven by a huge PC base. In in motherboard sales in FY11-12. It has among consumers in these five years a report, independent research firm been selling approximately 20,000 and witnessed a surge of over 155 per International Data Corporation (IDC) motherboards per month according to a cent. Inkjet printers are an equal favou- estimated that a total of 10.48 mil- company press release dated August 01, rite of Indian consumers and showed lion PCs had been shipped in CY 2011 2012. The total size of the motherboard an increase of over 120 per cent in sales (January-December), reflecting a six per market was estimated to be around 3.2- in five years; consumption of DoT cent year-on-year growth over 2010. In 3.5 million in 2011, as per projections by Matrix printers remained stagnant. the first quarter of 2012, according to IDC, worth around `1,000 crore (US$ As consumer numbers grow and Gartner Inc, the total desk-based and demand for better designs and perfor- mobile PC market in India was nearly mance rises, players in the peripherals 2.8 million units. In the Indian PC space are a happy lot. Mukesh Singh, market shipments for the second quar- Proprietor, Headway Informatics in the ter, April-June 2012 stood at 2.86 mil- Fact File peripheral hub of the national capital, lion units, a year on year growth of 15.7 Industry growth in 2011-12: 14.7 Nehru Place, New Delhi, is a dealer of per cent and 8.6 per cent over the previ- per cent computer hardware. Giving an over- ous quarter. Based on the market senti- Aggregate revenue stood at view of the demand scenario, he says: ments, IDC forecasts that the personal `558,530 crore (US$ 101 billion) “The growth of the peripherals market computer sales in India will continue Growth expected by 2015: `4,480 in the last three-four years has been to grow in the coming quarter, as there crore (US$ 810.13 million) remarkable in the country. Earlier cus- would be festive season buying in the Size of computer peripherals in tomers preferred branded readymade country. In the 11th Five Year Plan, the 2011: `1,500-2,000 crore (US$ PCs or laptops. Now, they go for assem- government recognised the importance 271.24 to 361.66 million) bled ones. This change in preference of electronics manufacturing for the Market size of projectors in 2011: has translated into increased demand country’s development given its manu- 240,000 units for peripherals in the market.” facturing competitiveness. His picture of the Indian peripherals Market size of motherboards in In the monitors and projectors seg- consumer is that of a price conscious 2011: 3.2-3.5 million units ment there has been a sea change in yet product savvy buyer. “Majority of Growth of storage market in 2011: design and aesthetics. Bulky, square customers are still brand conscious. 10-15 per cent shaped monitors have transitioned into The brand preference depends upon sleek LCDs in sizes ranging up to 24 the product a consumer buys. For inches. While the preference for small instance, for a microprocessor, they screen size laptops grows, the 15.6” rely on Intel and for printers, it must screen size in desktop monitors has be an HP,” Singh enlightens. Buzzing seen a decline. Yet there was a 19 per with activity, the peripherals industry is cent growth in the standalone monitor poised to take centre stage in the elec- market in FY11 with total revenues of tronics space in India. `2,624 crore (US$ 474.8 million); 3D (The story is based on secondary research.)

www.ibef.org august-september 2012 37 sectoral update GEms & Jewellery

Gems & Jewellery Brilliant Prospects Changing consumer preferences bring out the lustre of the gems and jewellery sector, attracting more players to the shine fest. Charu Bahri.

n a country where jewellery never loses its sheen, the fortunes of the gems and jewellery industry cannot but look up. Periods of slow Idemand are mere blips in a trajectory that moves steadily north. Demand for gold, the frontrunner segment, has been growing at 13 per cent over the last decade and projections are bright on the horizon.

Domestic Bliss Associated Chambers of Commerce and Industry of India (ASSOCHAM) valued the domestic market for gems PHOTO: photo s.c o m and jewellery at about `152,185 crore (US$ 27.5 billion) last year. “A stagger- ing 964 tonnes of gold was imported to meet this demand,” notes Sunil Jindal, Managing Director, SRS Jew- ells, a retailer of hallmark jewellery. In short, the gems and jewellery growth story is steady. “Buying precious metals is always seen as a safe invest- ment in India. There is no setback in the jewellery market,” says Rajesh Agarwal, Director, Akash Ganga Jewel- lers. “Demand has dipped in terms of grammage but not cal changes in demand in urban areas are redefining the in ticket size. Customers are purchasing jewellery of lesser country’s jewellery retail landscape. grammage to make up for the high prices,” says Sandeep Close to 300,000 traditional neighbourhood jewellers Kulhalli, Vice President, Sales & Marketing, Tanishq. make up the unorganised sector which dominates the scene Increasing purchasing parity is a prime driver of demand with a 96 per cent market share. Large brands comprising across metros and mofussil towns. Whereas consumers in organised jewellery retail presently account for barely four smaller cities continue to demand traditional jewellery, radi- per cent of the overall market. But increasing urbanisa-

38 august-september 2012 www.ibef.org

Gems & Jewellery sectoral update

tion and changing demographics are setting the stage for Urban consumers exposed to western lifestyles, young domestic and international brands to capture a bigger share adults, and working women are emerging as the consumer of the pie. segments to reckon with. This lot is becoming bolder and more experimental with designs and cuts. “Fusion Brand Bonanza jewellery—a blend of traditional designs and contemporary Demand for branded retail jewellery is growing on the styles—is a growing fad among women,” says Jindal. Well- back of increasing consumer sophistication, better ser- heeled men desirous of buying jewellery for themselves are vices, wider choices, premium quality products, attractive being wooed too. exchange policies, media influences, etc. According to Buyers in the 20 to 40 age group are spurring sales of CARE Research, industry stalwarts Gitanjali Gems and platinum jewellery as well. Statistics put out by the Platinum Tribhovandas Bhimji Zaveri Ltd (TBZ) have witnessed a Guild International (India) show that the number of platinum CAGR of close to 30 per cent over the last five years. With jewellery outlets increased from 12 to over 300 in the last two-fifths of its sales coming from the domestic market, decade. It predicts this number will triple in the near future. Gitanjali has notched a CAGR of over 50 per cent in the last Earlier gold jewellery was seen as a storehouse of value, three years alone. but today, changing preferences have seen a growing num- The sector’s bright prospects are pulling in new players. ber of takers for larger diamonds as investment. Preeti Jain Reliance has jumped onto the bandwagon with its own of Jewels by Preeti believes that the media is playing a key jewellery retail format, Reliance Jewels. Some retailers are role in spreading awareness about the investment poten- adopting the ‘shop-in-shop’ format. In a bid to keep up with tial of diamonds and thereby, pushing acceptance for this the leaders, small and indepen- dent jewellers are now organising themselves and expanding in size to share a common brand identity and marketing strategy. Intensifying competition has “India is now prompted frontrunner retailers emerging as a market such as Titan, TBZ, Rosy Blue Group, Gitanjali Gems and Rajesh for larger diamonds, Exports to invest in brand-building exercises to spur the next round of starting from five to growth. “Now that leading brands over 100 carats.” have reached a critical mass in — Shushmul Maheshwari top tier cities and state capitals, CEO, RNCOS they are concentrating on expand- ing to Tier II and Tier III cities where there is a lack of organised players,” observes Revati Kasture, General Manager, CARE Research. Agarwal feels that brands entering smaller towns like precious stone. Marketing initiatives of major diamond Meerut, his base, will have to contend with highly price-con- producers, retailers and industry bodies are also portraying scious buyers. “Products that appeal to consumers in met- diamonds as exotic as well as affordable. ros can also be sold in small towns as long as the marketing “India is now emerging as a market for larger diamonds, strategy is tailored to justify the high price,” he says. starting from five to over 100 carats,” says Shushmul Maheshwari, CEO, RNCOS, an industry research company. Emerging Trends A salient trend is the emergence of the coloured diamonds Favourable trends in consumer preferences are doing their market. “High net worth individuals are demanding pink own bit to spur sales of organised retailers. Traditional and yellow coloured diamonds,” he adds. “Women espe- heavy gold sets used to enjoy nine-tenth of the demand. cially look for light gold jewellery studded with heavy dia- Now, as the market grows more fashion conscious, studded monds. The precious metal is the lesser ingredient while jewellery with diamonds and coloured precious and semi- the diamond has become bigger and of a superior quality,” precious stones, is gaining ground with consumers. Organ- observes Jindal. ised retailers of jewellery address this ‘wearable’ jewellery Burgeoning demand has enhanced the scope for vendors segment better than conventional jewellers. of all sizes and breeds. While larger chains pursue mass

www.ibef.org august-september 2012 39 sectoral update Gems & Jewellery

such promising destinations, most of which boast of siz- able migrant communities from the sub-continent. Indians, Pakistanis and Sri Lankans residing abroad are big buyers of ethnic Indian jewellery. Not for nothing is the Indian gems and jewellery sector a leading foreign exchange earner. Cutting and polishing a one carat diamond costs `555.40 (US$10) in India, `944.65 (US$ 17) in China and `8306 (US$ 150) in Belgium. India’s significant price advantage makes it the world’s largest dia- mond cutting and polishing centre, cutting and polishing nine-tenths of the world’s diamonds. Most of these units are located in Surat, a diamond processing hub contribut- ing over four-fifth of the country’s diamond processing “Now that leading revenues. brands have reached a Overall low diamond production costs, mainly because of the ample supply of low cost labour, assure retailers of critical mass in top tier healthy margins in international markets. Nor is there a dearth of inexpensive craftsmen skilled in jewellery design. cities and state capitals, According to the National Skill Development Corporation they are concentrating and IMaCS (ICRA Management Consulting Services), the gems and jewellery industry is slated to double its work- on expanding to Tier force from about 3.4 to 8 million employees by 2022. Much II and Tier III cities of this requirement would be for trained professionals with specialised skills capable of meeting the rising domestic where there is a lack of demand for innovative jewellery. The Gem & Jewellery Export Promotion Council (GJEPC) promoted Indian Insti- organised players.” tute of Gems & Jewellery is helping build the skills most R evati Kasture in demand, including jewellery design, refining, model General Manager, CARE Research making, jewellery manufacturing, CAD/CAM, gemmology and diamond grading. With the launch of a third branch in Gujarat following centres in Mumbai, the privately run acceptance, solo players are carving a niche for themselves Indian Institute of Jewellery is pitching itself as a pan India in the personalised and signature jewellery market. player aiming at bridging the gap between the supply and “Consumers flush with funds appreciate the exclusivity and demand for trained manpower. one-on-one attention that a dedicated designer can offer them,” says Jain. Future Focus The Indian gems and jewellery sector is uniquely posi- Growing Exports tioned to offer a blend of modern machine-made and tradi- Business is brisk in export-oriented gems and jewellery spe- tional handmade jewellery. Capitalising on these strengths cial economic zones (SEZs) and parks in Mumbai, Surat, would help the industry move up the value chain in the Hyderabad, Vishakapatnam and Chennai. Gems and jewel- global jewellery market. Up until this June, CARE Research lery contributed about one-seventh of the country’s total shows that export of gold jewellery, which is a value added export earnings in 2011. Exports from Manikanchan, an category, witnessed a growth of 47 per cent. The govern- SEZ in West Bengal crossed the `10,000 crore-mark (US$ ment has also extended support to the industry. Measures 1.8 billion) for the first time, up a quarter over 2011. Gold such as the introduction of duty drawback facilities, rules to prices have slipped back in 2012, but the SEZ occupants speed up the clearance of import and export consignments are hopeful of maintaining the good run on the back of ris- containing jewellery and gems, interest subvention of two ing demand in new markets. With demand shrinking in per cent to labour intensive export sectors and signing up to traditional export strongholds, notably, the US, UK, Canada the Kimberley Process Certification Scheme that promotes and in recent months China and Hong Kong, players are conflict-free diamonds are helping boost global uptake focussing on improving the offtake in existing markets with of diamonds processed in India. Continued efforts by all greater potential and on developing new markets. The Gulf stakeholders are bound to add to the sheen of the gems and countries, Saudi Arabia, Turkey and Singapore are a few jewellery industry.

40 august-september 2012 www.ibef.org

Handloom sectoral update

Handloom Spinning Success With ‘spinning’ demand for its widening array of products in distant lands, weaving novelty is the essence of the Indian handloom tradition. Charu Bahri

from fabrics and made-ups for regular use to ornamental fabrics like Madras muslin, brocades, chintzes, phulkari, etc. Made-ups include bed linen, table linen, bath linen, furnishings, rugs, etc. Product diversity ensures that hand- loom exporters have a variety of sectors to specialise in. It also gives them the opportunity to offset sluggish demand in one segment with another. For Arrnita Handloom Exports in West Bengal, it is their scarves and stoles that are wooing markets over- seas; on the other hand, south India- based Cannanore Handloom Exports finds increasing demand for its made- ups. India has major handloom centres across the length and breadth of the country, each region with its own tradi- tional speciality. Large centres of hand- ncredible designs, unique fibres dloom exports are to the US and 10 per loom weaving include Amristar, Jaipur, and to-die-for products define the cent to European countries. While there Benares, Lucknow and Tanda in the handloom sector that has pride of may be a slowdown in demand from north; Bhopal, Gwalior, Indore, Nag- place in the Indian fabric milieu. Europe, the rising demand from the US pur and Aurangabad in central India; The sector stands apart not only is likely to make up for any loss on this Baroda, Mehsana, Ahmedabad and Ifor the exquisiteness of its produce but score. This year, handloom exports are Surat in the west; Machlipattanam and also for its significant contribution to estimated to touch `2,000 crore (US$ Murshidabad in the east and Kanchi- the national economy. Handloom’s 363 million). puram, Madurai, Salem, Tanjore and labour intensive character makes it the Tiruchirapalii in south India. second largest employer after agricul- Product Diversity Handloom fabrics include Khadi, ture. It accounts for about a fifth of the With its origins in traditional hand- which is completely handmade—hand total cloth produced in the country and loom weaving and hand processing, woven with hand spun yarn, as well as around a tenth of the textile exports. the handloom textile industry has fabric that is partially hand-processed— Europe and the US are the two big- expanded to produce a range of modern hand-woven with mill spun yarn. Arnab gest global markets for the Indian hand- fabrics and made-ups. Today, handloom Roy, CEO, Arrnita Handloom Exports, loom industry. About 30 per cent of han- production covers a broad spectrum, believes that the inherent characteristics

www.ibef.org august-september 2012 41 sectoral update Handloom

of wholly handmade products not only are continuously innovating and experi- printed and jacquard handloom rugs. give this segment a unique identity menting across regional weaves and In recent years, he has been instrumen- but also guarantee its future success. fibres to come up with unique products tal in successfully developing an over- “Traditional hand-processed products to woo a wider consumer base. Players seas market for bath mats and hand are creations born of a rich heritage are reinventing product lines to stay woven rugs. This has in turn attracted of unparalleled craftsmanship. Such relevant to overseas buyers’ preferences new customers. Vij has also seen suc- intricate workmanship cannot be repli- and with innovative design and product cess in developing a new handloom cated on sophisticated looms, a fact that range keeping buyers’ interest alive as market in Malta. Popular export desti- protects them from any major slide in they go along opening up new market nations today include the US, Canada, demand,” he says. segments. “We experiment with colour Europe, Japan, Indonesia, some south- The handloom segment is also largely schemes, patterns, weaves, combina- ern African countries and West Asia. unaffected by popular business consid- tions of different yarns like tussar, jute, erations. “Exporters of such products wool, silk and cotton, and so on. The Modernising Production are open to minimal orders, which suits idea is to present buyers a new face of Another plus point of the Indian han- owners of overseas niche outlets stock- the handloom sector every season,” dloom sector is its quick adoption of advanced technology and the increase in installed capacity. The government is also keen to boost the sector. It provides “Exports of handloom financial and other support to establish products are open to new looms as well as modernise exist- ing ones. Four mega handloom clusters minimal orders which have been set up at Varanasi (Uttar Pradesh), Sivasagar (Assam), Virudhu- suits owners of overseas nagar (Tamil Nadu) and Murshidabad niche outlets stocking (West Bengal). Handloom clusters at Chirala and Madhvaram in Andhra hand-processed Pradesh, each with about 5,000 looms, Arnab Roy, CEO, Arrnita Handloom handlooms. Market are being developed in a holistic man- Exports ner. Fifty two more handloom clusters demand too is inelastic...” in the state, each encompassing 300 to 500 looms, are being developed under the Integrated Handlooms Develop- “The sector has seen a tenfold ment Scheme. According to Ranjith Kumar, Manag- increase in performance in the ing Partner of Cannanore Handloom past few years. New technological Exports, “The sector has seen a tenfold increase in performance in the past capabilities are helping exporters...” few years. New technological capabili- ties are helping exporters keep up with Ranjith Kumar, Managing Partner, Cannanore Handloom changing preferences overseas. With Computer Aided Designing, Computer Colour Matching and Computer Aided ing hand processed handlooms. Market shares Roy. Fibre combinations with Manufacturing, manufacturers can demand for these products is mostly greater scope overseas are wool, silk carefully review designs and colour inelastic because it stems from high-end and khadi, that require good quality schemes prior to and during manufac- clients. In contrast, overseas mass retail- apparel grade wool and superior variet- turing to ensure compatibility with the ers are typically buyers of hand-woven ies of raw silk. demands of buyers abroad.” products of mill spun yarn,” adds Roy. Flexibility is indeed a major strength “To provide design and colour sup- of the handloom industry enabling it port, the Handloom Export Promotion Reinventing Fortunes to swiftly alter production and cater Council (HEPC) recently set up design However, Indian handloom exporters to differentiated markets. Prem Sagar studios in various parts of the country are not content to rest on the country’s Vij, President of the Panipat Exporters and also brings out colour catalogues rich legacy of handloom weaves. They Association, was the first to introduce synchronising Pantone numbers to

42 august-september 2012 www.ibef.org Handloom sectoral update

guide exporters with regard to colour territories. In this context, he lauds the and trend patterns prevailing in over- Fact File efforts of the HEPC. Retailing, branding seas markets,” adds Dr Beela Rajesh, Top countries in the handloom export and strategic alliances are not easy for Executive Director, Handloom Export basket small exporters. The council has stepped Promotion Council. The first design 1. USA 6. France in to prepare its members to take on studio was commissioned at Kannur in 2. Germany 7. Netherlands new markets and grow their revenues Kerala in 2008. A studio in Hyderabad 3. UK 8. Japan in existing ones. It is taking a proactive followed in 2010. 4. Australia 9. UAE role to showcase Indian handloom talent 5. Italy 10. Spain abroad and increase its reach. Scaling Up HEPC members are encouraged to Western countries demand Indian Major categories exported participate in trade fairs, exhibitions handloom products in bulk. Large scale Table linen: Table cloths, place mats, and buyer-seller meets in India and manufacturing necessitates suitable table runners and napkins overseas. Trade missions are sent over- infrastructure, state-of-the-art auto- Bed linen: Bed spreads, bed sheets, seas to help exporters tap emerging matic machines and sufficient skilled pillows, quilts, duvet covers, comforters opportunities. Indian handloom prod- operators. Decades ago when Panipat Bath linen: Towels, bath robes, etc ucts are publicised abroad through suit- came onto the export stage, about 90 Kitchen linen: Tea towels, dish able channels, including publications per cent of the business came through towels, hand towels, aprons, mittens, tea- brought out especially for this purpose. hand spun yarn. Realising the potential cozies, etc Information from trade data, commer- for mill spun yarn, Vij introduced a Furnishing articles: Cushions, cial intelligence and overseas market new line of products. And the rest, as throws, bolsters, tapestry, etc studies is collected, collated and dissem- they say, is history. Curtains: Drapes, blinds, and other inated for the benefit of exporters. The Understanding the requirements of a window dressings, shower curtains, room HEPC is also responsible for advising competitive global market, the Indian dividers the government and local authorities on handloom industry adopts a thoroughly Floor covering: Floor mats, bath policy matters, in particular, to assess professional approach with regard to mats, rugs, carpets the effect of direct and indirect taxa- commitments to timely sampling, on Apparel: Mostly Indianwear, sarongs, tions on handloom exports and on other time deliveries and adoption of the high- etc industry aspects. est quality control norms. Larger players Fashion accessories: Shawls, Another important Council initiative have also brought in ISO 9000-9002 scarves, stoles, bags, etc is the annual International Fair organ- and ISO 14000 standards to ensure ised exclusively for handloom products world-class quality and adhere to high at the Chennai Trade Centre during quality and packaging standards. Wall hangings February-March. Handloom resonates strongly with Gift & home products Market development and market its grassroots origins and hence eco Trimmings & embellishments exploration is the need of the hour for

friendliness is an expected feature of Source: Handloom Export Promotion Council the handloom sector and players are handloom products. With Azo chemi- going all out to expand the horizons for cal colours and dyes being banned in a handloom products. Roy has set in place number of European countries, Indian marketing tie-ups in his overseas mar- handloom exporters too have adopted kets like Japan, Italy and France, while safe substitutes to cater to demand he directly takes care of other steady from these regions. Originally too, markets—Denmark, Norway, Belgium, Indian handlooms were dyed using Switzerland, USA and UK. natural elements like indigo, turmeric, Beyond doubt, the Indian handloom sunflower, etc, and these methods are industry is geared up to meet the making a comeback. challenges of globalisation, with the installed capacity for the production of Supportive Framework both handloom furnishings and fabrics Vij’s success with new product lines and being sufficient to meet the present his unearthing a new market in Malta overseas demand. Future success will has come on the back of strong market- revolve around showcasing and build- ing channels, the key to pushing new ing up of demand for outstanding cre-

PHOTOs: photo s.c o m products and making inroads into new ations by indigenous handloom skills.

www.ibef.org august-september 2012 43 made in india Hero Motocorp Hero

No.1Hero MotoCorp has lived up to its name. It has not only sustained itself post the 2010 split with Honda after a 26-year association, but also retained the top position since 2001. By S Ojha

t’s a ‘hero’ in the field of two- the success story at Hero MotoCorp only R&D activities to a great extent. Meanwhile, wheelers. Hero MotoCorp Ltd gets stronger with every passing quarter. Pawan Munjal, at the Global Supply Chain (HMCL) had its genesis in While the momentum is with us, we are Partners’ Conference 2012 held at St Peters- 1984, rose to No. 1 position in not resting on our laurels. We are stepping burg in Russia recently, said that a fourth motorcycle manufacturing in on the accelerator to expand our sprawling addition to the company—Global Parts 2001I and has maintained the position network within the country even as we Centre—would be set up at Neemrana with till date. enter new geographies globally.” a capex of `160 crore (US$ 28.85 million). The yearning for success is limitless in The ambitious company aims to achieve This facility will be operational by the third Hero MotoCorp. The company has witnessed 10 million unit sales of two-wheelers, quarter of 2013-14 and initially employ 400 an undiminished growth trajectory even after export one million units, and grow its rev- personnel. “The highly-mechanised, techno- its split with Honda Motor Co., Japan in 2010. enues to `5,5340 crore (US$ 10 billion) by logically-superior Global Parts Centre will be Hero MotoCorp mesmerised the two- 2016-17. It is set to begin its foray into Latin a new industry benchmark once it becomes wheeler market by registering a10 per cent America and Africa and aims to achieve 10 fully operational,” said Munjal, addressing growth in unit sales in the first quarter of per cent of its revenue from international an audience of over 200, including more financial year 2012-13 over the previous markets in the next five years. than 125 top component suppliers of HMCL. quarter. The company sold over 16 lakh The company has three manufacturing units—its highest-ever sales in any single facilities based at Dharuhera and Gurgaon The Genesis quarter. The company sold 5,56,644 two- in Haryana and Haridwar in Uttarakhand Prior to 2010, this motorcycle and scooter wheelers in May 2012, its highest-ever and produces three million bikes per year. manufacturer, based in New Delhi, was called monthly sales, surpassing the previous HMCL now proposes to set up two more Hero Honda. This nomenclature was the record of 5,51,557 units in the April 2012. factories, at Neemrana in Rajasthan and result of a joint venture (JV) between Hero Buoyed by the success, Pawan Munjal, Halol in Gujarat, with a capital expenditure Group of India and Honda Motor Co., Japan Managing Director and CEO, said in a (capex) of over `2,500 crore (US$ 451.75 in 1984. Hero Group owners, the Munjal press release, “It has now been more than million), to handle the growing volume of brothers and the Honda group, each owned a year since we began our solo journey, and demand. These facilities would also further a 26 per cent stake in the company. With this

46 august-september 2012 www.ibef.org Hero Motocorp made in india

collaboration, the first manufacturing plant Subsequently, the company was renamed try other than Sri Lanka. The de-merger was set up at Dharuhera. However, after Hero MotoCorp in August 2011. opened up opportunities for the Munjals to working together for 26 years, Honda decided The JV had its limitations. As per the reach out to international markets. to exit the company in 2010 and sold its shares agreement, Hero Honda was restrained to the Munjal brothers in a phased manner. from selling products to any foreign coun- Success Formula Right from inception, the company fol- lowed its motto of manufacturing fuel- economic and low-cost two-wheelers that The Pioneer became a rage among Indian customers. For the company it meant nearly double- Brijmohan Lall and began sending cords for becoming the larg- digit growth and by 2002 it had sold an Munjal was components across the est manufacturer of bicycles in enviable 86 million bikes, and was produc- born in 1923 at country. the world. ing 16,000 motorcycles daily. Kamalia (now Hero Cycles Limited was Besides being honoured in Pakistan) in a registered with several awards for con- High Growth middle-class family. in 1954, tribution to trade and industry, The growth rate record of the last few years Brijmohan and his family and the Dr Munjal received India’s third vindicates the company’s dominance over moved to India and settled in Munjals started manufacturing highest civilian award, the the two-wheeler market in India. Ludhiana after partition. bicycles, partially financed by Padma Bhushan, in March In 2005-06, the growth in unit sales was Sensing Ludhiana's poten- the Punjab government. 2005. 14.47 per cent and in 2006-07, 11.20 per cent. tial as an industrial hub, Brij- In 1975, the company Munjal often says: Don’t However, the company witnessed a mild mohan along with his brothers became the largest manufac- dream if you can’t fulfil your growth of 0.01 per cent in 2007-08 due to started supplying bicycle turer of bicycles in the country. dreams. He dared to dream the global economic slowdown; but it soon components in the city. Soon, In 1986, it earned a place big and made sure that he bounced back to a double-digit growth of they expanded their network in the Guinness Book of Re- achieved all his lofty plans. 11.53 per cent in 2008-09, leaping to 23.59

www.ibef.org august-september 2012 47 made in india Hero Motocorp

per cent in 2009-10, 17 per cent in 2010-11 The company demonstrated a hybrid ances with reputed international firms to fur- and 15.41 per cent in 2011-12. scooter, Leap, at the Auto Expo held at ther enhance its existing R&D capabilities. In The company produced three million Pragati Maidan in 2012, as a part of Hero February this year, the company announced bikes in 2005-06 and earned a net income MotoCorp’s vision to introduce environment a new partnership with Erik Buell Racing of `8,870 crore (US$ 1.6 billion). It made a friendly two-wheelers to the market. The (EBR), a Wisconsin-based firm. This will steep climb thereafter and crossed the six first bike launched by the company under enable them to seek cutting-edge technology million mark in 2011-12 to harness a net its new brand name is a first-ever off-road and design support from EBR, which special- income of `23, 944 crore (US$ 4.3 billion). bike—the 150 cc Hero Impulse. It has ises in designing and manufacturing of pow- The spirit of entrepreneurship runs opened up a new segment in the Indian erful and high-speed motorcycles. Close on deep in the Munjal family. Undeterred by two-wheeler market—the on-road-off-road the heels of this tie-up, HMCL has also roped having to go it alone post the separation category. HMCL’s current scooter, Pleasure, in Austria-based engine specialists AVL to from Japan’s Honda, the company went on specifically targeted at its female customers, enhance its in-house engine technologies. a high octane publicity blitzkrieg roping in has helped the company expand the scooter the world renowned music composer AR market. The company recently launched Vast Footprint Rehman. The jingle Hum me hain Hero, a new 125 cc motorcycle, the Hero Ignitor. HMCL currently has about 5,000 touch composed and sung by Rehman, caught HMCL is set to enter a new segment with the points, which include authorised dealer- the imagination of the nation and helped planned launch of the 110 cc Passion XPro ships, service and spare outlets (SSPs) the company retain its hold over the later in the year. and authorised representatives of dealers market. And with the astounding growth (ARDs). It plans to add another 400 touch in the first quarter of FY 12-13, Hero is New Alliances points to the network in 2012. The company set to remain at the top until a worthy Having chosen to chart its own path to suc- with strong rural initiatives, consolidated its competitor surfaces. cess, HMCL has forged new strategic alli- rural footprints further under its ‘Har Gaon Har Aangan’ umbrella in 2007. HMCL has already covered more than 100,000 villages across the country under this programme. Currently, about 47 per cent of the com- Rise of the Hero— pany’s total sales come from rural markets. It also has an innovative ‘Service Har Jagah’ Zip, Zap, Zoom initiative to serve rural markets. First Bike CD 100 in 1985 Sleek in 1989; Promoting Sports CD 100 SS in 1991; Hero MotoCorp is one of the largest Splendor in 1994; corporate promoters of sports in India. Street in 1997; It was a partner in the 2010 Common- CBZ in 1999; wealth Games held in Delhi and a pre- Passion & Joy in 2001; senting partner of the Queen’s Baton Dawn & Ambition in 2002; Relay. The company was also the title CD Dawn, Splendor Plus, Passion sponsor of international hockey’s showcase Plus & Karizma in 2003; event, the Hero Honda FIH Men’s Hockey Ambition 135 & CBZ* in 2004; World Cup 2010, held in New Delhi. It has Super Splendor, CD Deluxe, Glamour, been associated with cricket for over two Achiever & scooter Pleasure in 2005; decades and is one of the partners of the New models of Splendor NXG, CD IPL Twenty20 tournament. Hero MotoCorp Deluxe & Passion Plus in 2007; is also the Team Sponsor of a top IPL team, Hunk in 2007; Passion Pro, new Mumbai Indians. The company is one of models of Pleasure, CBZ Xtreme, the main global partners of the Interna- Glamour in 2008; tional Cricket Council (ICC). New models of Karizma & Hunk in HMCL also hosts the annual Hero 2009; Indian Open Golf Tournament which Super Splendor, new models of boasts participation by international Splendor Pro & Hunk; new models of marquee players. It has been sponsoring Glamour, CBZ Xtreme & Karizma in the Men’s Indian Open since 2006 and 2011 the Women’s Indian Open since 2010.

48 august-september 2012 www.ibef.org innovation corner CGN Research Labs with a human

heartA research lab in India devoted to innovative application of biomedical engineering for alleviating human pain. By Sangita Thakur Varma

n the mission statement of CGN vation in a field that would add lustre to India’s Research Labs, what catches one’s atten- growth story. Dr C Jairaj Kumar, Director, R&D, tion is its avowed policy vision to direct and Chief Medical Officer of CGN Research its “growth in the areas of biomedical Labs, is confident of the country increasing its engineering; to gather people and facili- presence in the field: “Majority of the medical tiesI that tend to augment these areas; to continu- equipments that we use are currently imported ously build on these areas through education and or non-Indian innovations. We do not have knowledge assimilation…to contribute to human established Indian medical device innovations welfare by application of biomedical engineering that rule international market. But this field in the research, design, manufacture, and sale offers huge potential with increasing promo- of instruments or appliances that alleviate pain, tional programmes aimed at encouraging restore health, and extend life.” Indian innovations. We are sure several Indian The field of biomedical engineering is just companies shall make their mark in medical coming into its own in India. CGN Research device industry in the near future.” Labs is unique in its devotion to the promotion The researcher firmly believes that “estab- of cutting-edge research, technology and inno- lished midsized medical device companies

50 august-september 2012 www.ibef.org CGN Research Labs innovation corner

in India must focus on pathbreaking “on diabetic foot. We have developed the physician is then able to assess pro- innovations rather than making small two products, the first one measures gression of neuropathy at pre-clinical stag- technical improvements to their exist- nerve damage and the second product es and can adjust and tailor medications ing device.” This is the way for India to detects vasculopathy,” says Kumar. (or assess efficacy of medications being make its mark as an innovator of medi- Explaining the technology behind the administered) and treatment regimens to cal equipment on the global firmament. invention, he says: “This technology proactively prevent foot ulcers from form- CGN Research Labs was founded in is a new method for detecting diabetic ing. The device can: 2010 by Dr Jairaj Kumar, Joint Managing neuropathy and predicting foot ulcer • diagnose neuropathy Director of the company and C Satish development. The technology would • predict foot ulcer development and Kumar, Chairman and Managing Director, best be described as a diagnostic tool thereby prevent amputation (removal with two inventions—the first was a for measuring the progression of neu- of fingers, etc) device that uses the revolutionary chaos ropathy (any neuropathy not limited • quantify the efficacy of medication theory to diagnose diabetic neuropathy to diabetes) and predicting foot ulcer The author of over 50 international and the second a device called Thermo development. It could also be useful for research papers, Kumar is the Edi- Scan, that was developed using a patented patient management for diseases like tor in Chief of Scientific Medicine, an nanoparticle focal plane array. A recipient leprosy and multiple sclerosis in that International peer reviewed medical of Phillips Best Inventor Award in 2009, all involve potential nerve damage.” journal. He is also the Associate Editor Dr Jairaj Kumar’s motivation for The technology involves both hardware of prestigious international medical founding the company lay in his belief and software algorithms. The key compo- journals like Australasian (Australia) that “any innovation that addresses a nents of the hardware are the sensors on and Cases (UK), besides serving as significant problem shall certainly be a which the patient places his feet. The soft- referee and reviewer for several other sustainable business.” The lab’s vision ware allows the physician to pinpoint loca- international medical journals. Apart is to conduct pathbreaking research tions on the feet to assess. Its mechanism from contributing to the medical that reaches its end user. “We intend involves these sensors then being able to world in his research capacity, Dr Jai- to commercialise our innovations and detect micro movements in the feet with raj Kumar is also motivating young the company has an active marketing very fine precision. With the device detect- students in the field through his role division,” informs Kumar. ing and graphing the micro-movements, as a teacher. He is a visiting profes- Thermo Scan uses a non-invasive sor at Jawaharlal Nehru Centre for technology that is simple and pain- Advanced Scientific Research, Banga- less. The scan performs a plethora of lore, and has collaborations with IIT functions ranging from diagnosing Lab View Hyderabad, NRSA-ISRO Hyderabad, early stage breast cancer, to imaging Name: CGN Research Labs Pvt Ltd University of Munich, LMU, Germany inflammatory pain, detecting diabetic Founder: Dr C Jairaj Kumar and University of Missouri, USA. For vasculopathy at a very early stage to Mission: Application of biomedical CGN Research Labs it is not yet time detecting sports injuries; thus it can engineering in the research, design, to bask in glory. help start treatment early and prevent manufacture and sale of medical Rigorous research is the adopted path further damage. The device employs an devices that alleviate human pain for this upcoming research hub with extremely user-friendly procedure. It Founded: 2010 a goal to “develop and manufacture a takes only a few minutes to conduct the Next: Self-monitoring neuropathy & wide range of products and therapies tests and is ergonomically designed for thermal imaging laparoscopic devices with emphasis on providing a complete easy operation. It is a portable and com- continuum of care to diagnose, prevent pact device which renders razor-sharp and monitor chronic conditions in the thermal images and its high tempera- near future.” Speaking about future ture accuracy guarantees precise data plans Dr Jairaj Kumar says, “We are measurement. In 2011, CGN Labs was now developing a home healthcare bestowed with the Best Medical Elec- neuropathy device for patient self-mon- tronics Product of the Year Award for itoring and are working on developing its Thermo Scan by India Semiconduc- a thermal imaging laparoscopic device.” tor Association. Another advancement that is sure Conferred with a DST-Lockheed to contribute to human welfare, bio- Martin Gold Medal in the year 2010, medical research and engineering, and Kumar firmly believes in moving ahead. India’s profile as an emerging hub for The research focus of CGN now is cutting-edge innovation.

www.ibef.org august-september 2012 51 arts & culture

Contemporary Glass: Geetha Mehra, Director, Sakshi Gallery welcomes visitors to the 10,000 sq ft space on the ground floor with a private garden. (Below) A room with a view. Art for Now The destination of the crème de la crème of India in search of the pièce de resistance in art, Sakshi Gallery is playing a lead role in conserving India’s artistic talent. By Sangita Thakur Varma

rt is best bought because of the response that one feels to launched Sakshi Gallery in 1984, in Chennai. it. Considerations such as investment follow later,” says Recalling Sakshi’s debut days, Mehra says, “Those Geetha Mehra, Director of Sakshi Gallery. Mehra should were pioneering times in art, particularly in know, as Sakshi plays an advisory role to many of India’s Chennai, with no benchmarks to follow.” The art collectors. Mehra herself had realised early on, as a challenge for Mehra lay in finding her own “Ateenager with an avid interest in art, that she “didn't have the talent to path and carving a unique identity for Sakshi. paint, so the next best thing was to be involved in management of art.” It helped though that India was culturally To pursue her abiding interest, Mehra took up History of Fine Arts as alive with art aficionados and connoisseurs a “deliberate” choice and after acquiring a master’s degree in the subject, in plenty. “People were receptive, although

52 august-september 2012 www.ibef.org Sakshi Art Gallery arts and culture

Picture Perfect from September 13-October of God who brings both showcased at Zacheta ‘The Visitor’, an outstanding 13, 2012. The Visitor is good and bad to earth. National Gallery of Art in work by young contemporary Muthiah’s most ambitious Muthiah has held two Poland, Winterthur Museum in artist Nandini Valli Muthiah will project. Her protagonist Krishna successful solo shows so Switzerland and Whitechapel be on display at Sakshi Gallery is shown as a messenger far and her work has been Gallery in London.

Chennai was more tradition-bound and inclined towards classical art,” Mehra reminisces. Sakshi had been relocating every few years in search of the best architectural space in synergy with its artistic aspirations. Mehra came to Watch this Space: Art Mumbai in 1992, recognising the vast potential works displayed in the vast precincts of that India’s art and culture hub offered. She Sakshi Gallery. Sakshi first set up the gallery on Altamount Road. The showcases contemporary paintings, sculptures, next shift saw them at Sriram Mills, a textile prints, installations, etc, facility, and they are currently at Colaba, “which by both budding talents has an old world kind of charm,” says Mehra. and renowned names like Anirban Mitra, For Mehra it has “indeed been a long and Anish Kapoor, Chintan exciting journey.” Discussing the strides the Upadhyay, Jitish Kallat, as well as international Indian art scenario has taken, she says that not artists. The notable only has the number of artists increased but “the names that were up for works that they attempt are far more ambitious grabs in the Easy Buy artists and is equally patronised by established show held in June 2012 than before.” The art collector’s profile has also at Mumbai included artists. Artists to watch out for, says Mehra undergone a sea-change and there are several prints by MF Husain, are, “All the young ones.” Another thing Mehra who buy more adventurous works such as lithographs, drawings has done successfully is bust the myth that and posters by Manjit multimedia pieces, video installations, et al. Bawa, NS Harsha, art is for the enlightened and the elite. Sakshi Sakshi is a corporate entity with closely- Krishen Khanna, Jitish has tried to make art affordable. “Our ‘Easy Kallat, KG Subramanyan held shares. Post its merger with Synergy Art and Jogen Chowdhury; a Buy’ show held in June 2012, received a huge Foundation Ltd in 1989, the gallery widened limited edition Bhupen response. I had not realised that there is a its scope and breadth of operation. In 2009, Khakhar signed print; whole audience out there eager to buy art who a limited edition Arpita it set up an international branch in Taipei, Singh print and some has limited resources and finds the gallery Taiwan, in its endeavour to promote both etchings by Somnath experience intimidating,” says Mehra. She wants Hore. There were also Indian and international young talent. paintings by younger art to be introduced in the school curricula Mehra finds scouting for, and working artists which would gain for it to get a wider exposure. Appreciation with, new talent “both challenging and very value as they gain stature. for art must certainly start early, for artists to rewarding.” The gallery has debuted many young find devoted patrons like Geetha Mehra.

www.ibef.org august-september 2012 53 Tourism update Pondicherry Cultural Vanguard: Mahatma Gandhi's four- metre statue situated along the Promenade is a cultural hotspot in Pondicherry.

Cafe Class: The many cafeterias and pubs dotting Pondicherry add a quaint French village charm to its exoticism.

Soul Search: Step out on the beach at dawn to commune with Nature and enjoy the pristine beauty of Pondicherry. Promenade Beach is perfect for these morning walks. copyright: abhishek bali copyright: India’s French Coast! Pondicherry with its French heritage and still unexploited beaches is a traveller’s delight. By Sangita Thakur Varma

he French Riviera of the East retains its flavour. There’s a tered view of the sea on the other as you drive distinct yet mellow air that blows here gently, slowing life to down the East Coast Road (ECR) is but a trailer a leisurely pace. The moment you disembark from your taxi, to the breathtaking allure of an unforgettable Pondicherry, the capital city of Puducherry, strikes a differ- sojourn. There are other routes like the National ent chord—but not a discordant note. You can hear the Koel Highway 45 or the Grand Southern Trunk (GST) T(the State Bird) sing in the arbours of the French Quarter, the gentle lap of or the drive from Bangalore. You may even take the sea, strains of a piano wafting from one of the arched doorways of the a flight to Pondicherry. But then you will miss colonial style villas on Rue Romain Rolland. the midway stop at Mahabalipuram for a visit It takes around three hours by road to reach the town from Chennai. to the famous temples and the priceless drive The picturesque drive with sand dunes flanking one side and the unfet- down the ECR.

54 august-september 2012 www.ibef.org Puducherry tourism update

What makes Puducherry so distinct is the Five Key coexistence of a multicultural cosmopolitan Highlights core, which one finds somewhat surprising given the fact that it is tucked far away from 1. fragrance of mainstream India in the eastern seaboard. But France lingers here then, Pondicherry was always for the culturally bon vivant, as resident Puducherians will tell you. The population here is a mix of local Tamil folk, the Bengalis and the Oriyas who came in with Aurobindo Ghosh when he set up his famous ashram in 1926, French expatriates Romain Rolland Street, (who chose to stay behind even after ‘Pondy’ named after the French became a Union Territory more than 50 years scholar and associate of Play on : Music and dance at dusk mark the perfect end to an Mahatma Gandhi. eventful day exploring the city. Put up your feet, close your eyes ago) and the Europeans and Americans who and let go, or take to the dance floor with your partner. form two-thirds of the residents of Auroville. 2. Elephant Goddess There is so much to explore in this city that Blesses the devout is the office of the Puducherry municipality, is you are tempted to extend your few days by strongly reminiscent of French architecture. another few. There is also a sense of calm, a Every year on July 14, Puducherry celebrates peace that surrounds you; and for the time you Bastille Day to commemorate the French mar- are there, you are best advised to renounce all tyrs of the First World War. A memorial to them worldly connections (switch off your mobile, on Gaubert Avenue is beautifully decorated and and tuck that iPad out of sight), and throw your Lakshmi, a celebrity, has illuminated on the day to pay homage to these cares to the winds as you rent a bike (the best tourists making a beeline bravehearts. for the Ganesha temple mode of transport to wind down the tree-lined on Manakula Vinayagar The French Consulate General with its 18th boulevards and the seafront promenade) to Koil Street morning and century charm is the only diplomatic mission in evening. explore the many delights of this quaint city. Puducherry. Other French influences are appar- The town architecture leaves one wonder- 3. French Quarters ent in the now defunct 19th century lighthouse struck as no other city in India displays such a that stands on the edge of the sea and the Aayi distinct style. Go to the French Quarter which Mandappam that despite its Tamilian name still retains its Gallic aura in its neat grid was actually built in the time of Napoleon III, structure. Little seems to have changed here the emperor of France. The Raj Niwas is again with streets retaining their original French a piece of exquisite French architecture that names like St Martin, Rue Suffren and colonial Take a heritage walk down housed the French trading company. bungalows painted in mellow hues of pink and the wide roads to discover At the Church of Our Lady of the Angels in yellow with bright bursts of bougainvillea hang- the little nuggets of unique Dumas Street you can see the rare oil painting Pondicherry history. ing over their high compound walls and arched of Our Lady of Assumption gifted by Napoleon doorways. Rows upon rows of neat houses 4. Varied Collection III. The church is an architectural and historical with colonnaded porticos, you are struck by the marvel built in 1855 with its façade facing the symmetry and simplicity of design. The French sea. Right in front of the church in the middle Quarter seems to transport you to some provin- of a garden stands the tall and imposing marble cial village in France. statue of Joan d’ Arc. With her back to the sea There are several architectural marvels in and facing the church, she takes your breath Pondicherry that appear to belong to another A shopper's paradise for away with sheer simplicity of power. era. In fact, the whole ambience of genteel unusual curios, objects Other must visit French architectural wonders d'art as also some high elegance lulls you into feeling as though end brands. include The French Institute of the Far East you have stepped back in time. A visit to the situated on Dumas Street, an internationally Children’s Park with its statue of Marquis 5. Call of the Wild acclaimed research institute on Indology, his- Joseph Francois Dupleix is a strong Nature beckons one to tory and archeology. Its two buildings stand stay and savour its many reminder of Puducherry’s French occu- fascinating treasures. at the corner of the street. Dine at Hotel de pation. Dupleix was the governor of From a leisurely walk l’Orient built in 1809 on Romain Rolland Street Puducherry between 1742 and 1754. down the sea front, and you can also shop for some curios to take picnics in the park to The sea-facing The Mairie situated cruises down the sea, back with you while you learn about its history. on Gaubert Avenue, that today Pondicherry offers all. Hotel Lagrenee de Meziere, again on Rolland

www.ibef.org august-september 2012 55 tourism update Puducherry

To sea, to sea!: Take a catamaran and sail down to the sea or go on a cruise to enjoy the scenic beauty. Bonding Time: Visitor centre at the famous Auroville that is home to an international community.

Window View: A street named after the French East India Company which was founded in 1664.

Street, built in 1774, was once a private house. Today, it is a workshop for exquisite embroidery. You can learn the story of the intervening years of Puducherry from the nuns of St Joseph of Cluny. The house was donated to the order some 150 years back. There are many more such historical nuggets that keep you going back to explore the streets of Pondicherry. The streetscape of the Tamil or the Indian Quarter is one such thing—a direct contrast to the grid like French colonnade houses, the Tamil Quarter or talking street as it is called has intimate continuous wall to wall constructions that are typical of Tamil and pitch a tent for a night out under the beauti- architecture. While here, visit the Botanical Garden which is at the centre ful tropical sky. You can even cruise out to the of the old Tamil town. Built in 1826, it stands out from its surroundings sea and espy some frolicking dolphins as an given its ornate French landscaped style. added bonus or just laze on the boat. You can With a coastline of 32 km, Puducherry boasts of some of the best beach- make arrangements for the cruise at Pondi- es. What adds to the attraction is that they are less commercialised and cherry itself. offer peace and quiet. Head out to the Auroville beach at the break of dawn For those keen on trying the local cuisine, and join the meditators on the pristine sands. There is the Promenade, it’s as close to authentic French as you can the Paradise and the Serenity beach as well if you want to spend your day get in India. The town has many Vietnamese lazing beside the sea. Or simply stroll along Beach Road one evening and restaurants, a relic of its French past, that serve breathe in Pondy air. up delicious chicken noodle soup. Try Creole A visit to Aurobindo Ashram and Auroville is of course mandatory to cuisine. Also try a meal at one of the commu- understand the unique international community and the blend of yoga nity kitchens at Auroville or the Visitors’ Centre and spirituality that drives them. Apart from these, there are several while shopping there. temples, churches and mosques that offer unique architectural insights. The best time to visit Puducherry is between For the historically inclined there is the Puducherry Museum on St Louis July and February. So pack your bags this Street, the Ananda Ranga Pillai Museum. Pillai was the dubash of Dupleix autumn and head for this boulevard town seeped and his diaries are a revelation on the life and times of the 18th century in French nostalgia, tree-lined promenades, French in India. The Bharathi Memorial Museum and the Bharthidasan pristine beaches with palm trees swaying in Museum offer glimpses of Tamil literature at its best. the breeze, backwaters, fishing on catamarans, If time permits, you can venture a little further and visit Chunnambar cruise on the sea, fine wine and cuisine, and the Backwater around 8 km from Pondicherry. Sail down the beautiful creek thrill and adventure of the unexplored.

56 august-september 2012 www.ibef.org

“Indian mind has been shaped by remarkably

BOOKsHELF diverse forces.” Sha s hi Tharoor

India’s Tryst with Destiny A fascinating look at India’s foreign policy, replete with insightful anecdotes in a racy narrative style. by Sangita Thakur Varma

From the opening lines rec- talks of an India that is “multi- About the holds up India’s foreign rela- reating Nehru’s historic proc- aligned”. The India of the 21st author tions under the unrelenting gaze lamation of “India’s tryst with century that Tharoor writes of his magnifying glass as he destiny”, Shashi Tharoor clev- about has a much wider role Dr Shashi marches the diplomatic elephant Tharoor straddles erly weaves his vision of India’s to play in the world. This Pax many worlds with down post-colonial India cover- “multi-alignment” by capturing Indica is not about India, but equal finesse. He ing a vast geographical territory dramatically that unforgettable its “sense of responsibility to the is a columnist, and time span to the present midnight of August 14, 1947. world of which it is such a crucial an award- reality of the 21st century world. winning author, His pen creates magic as we part—and whose destiny it has a distinguished Tharoor does not offer a model can almost hear the thunder- earned the right to help shape.” speaker, a former policy extrapolated from past ous pronouncements of our The book is an insightful and United Nations trends, rather he does a situa- first Prime Minister Jawaharlal informative critique of India’s Under-Secretary- tion analysis which is country General for Nehru to the Indian Constitu- foreign policy, written with Communications and context specific and then ent Assembly: “Those dreams an insider’s understanding of & Public arrives at a set of suggestions are for India, but they are also diplomatic affairs. The racy nar- Relations, that he says India must take into for the world, for all the nations rative, with a liberal sprinkling of peace-keeper, cognisance when formulating its refugee worker, and peoples are too closely knit Tharoor’s witticisms and real-life human rights diplomatic ‘derring-do’. All this together today for any of them anecdotes, makes this almost activist, former while, Tharoor is cleverly lead- to imagine that it can live apart. 500-page tome a pleasurable Minister of State ing us, step by step, to his grand Peace has been indivisible, so is read. Though Tharoor never of External Affairs vision of India of the 21st century. and an elected freedom, so is prosperity now, meant Pax Indica to be a schol- Member of the He humourously yet dexterously and so also is disaster in this arly read, the book has turned Indian Parliament exposes diplomatic gaffes, the One World that can no longer be out be a mine of information for from Kerala. politically strident yet confound- split into isolated fragments.” all—young minds to make “intel- ing calls, the openly divided pub- This is the premise that Shashi ligent living room conversations” lic opinion on issues of national Tharoor goes on to explore, on foreign policy and interna- importance and the media’s elucidate and hammer forth in tional relations to mandarins questionable role in pandering Pax Indica. Tharoor’s book is in the South Block working out to popular views. Yet through it not about a superpower India or diplomatic strategies for near all, Tharoor is clear about one a non-aligned India, rather he and far. In the process, Tharoor thing—India is the rightful

58 august-september 2012 www.ibef.org BOOK sHELF

leader of the 21st century world. Tharoor believes that India Tharoor unveils his grand plan for must seize the responsibility to lead the world, and shows India of the 21st century. He evokes the way to a re-orientation of India’s soft power and defines the India’s foreign policy thinking to this purpose. The book, says quality as the power that emanates Tharoor, is structured like an onion. And as you turn the book from the world’s perception of page by page you have a feeling that you are peeling the layers what the country is all about and to a hidden kernel of wisdom. With neighbours, he advocates is very distinct from hard power. diplomacy built on dialogue, tak- ing up a position that is between the “hawks” and the “doves”. Tharoor’s inimitable style evokes follows is the strategy to develop inside the take on its bigger role—steward- more wry humour than tears. and strengthen this soft power. book ship of the “global commons”. The international imagination is The cynics amongst us may Tharoor’s pronouncements on currently dominated by the two find this a wee bit hard to swallow. India warm the cockles of the rising powers of the East—India For from here onwards Tharoor’s heart, but by now Pax Indica and China. In Tharoor’s 21st foreign policy of soft power seems leaves the reader bewildered. Of century world both India and somewhat lacking in punch and course “India is at home in the China can co-exist in peace conviction, a little facile. However, world”. The 21st century world despite their tensile relation- his firm belief that foreign policy is multipolar and multicultural. ship. He illustrates effectively must engage the people will find “We need to look India’s cultural and national fabric why it is important for India to many an echo. Given the dangers to the future... is rooted in this multiplicity and where geography maintain a cordial, economi- of engaging with the social media becomes an as such, it is certainly much at cally beneficial relationship with and the recent controversies sur- instrument of home. It is also true that in the China in order to “concentrate rounding it, to what extent can opportunity 21st century, “multi-alignment” on our domestic tasks”. ‘delicate’ matters like foreign policy in our mutual through global partnerships growth story, Moving on from India’s be shared on the public domain where history across a wide spectrum of areas is individual relationships with its in order to develop what Tharoor binds rather not something alien to it. But are neighbours near and far, Tharoor calls the soft power strategy via than divides, all these qualifications enough unveils his grand plan for India “public diplomacy” needs to be where trade and to take on the leadership of the cross-border of the 21st century. Diplomatic debated. One cannot but agree links flourish and world? Are there not deeper writing has rarely focussed on with Tharoor that India needs an bring prosperity issues, harsher realities in the something as intangible as what “informed and engaged citizenry to all our people. world that are pulling nations, nay he evokes as India’s “soft power”. to face up to the responsibilities Some will say people within nations apart? these are merely He defines this quality as the of being a global player in the 21st dreams... But India certainly will play a power that emanates “from the century.” But first we must build dreams will only strategic role in this world order world’s perception of what the the right channels of information. turn into reality if and help frame the rules that country is all about” and is very Tharoor envisions a larger than we take action to will change the way nations accomplish this distinct from “hard power” or life role for India of the 21st brighter future interact. But will it bring to life military might. He says India century—a world leader with together.“ the grand picture of Pax Indica— possesses it in plenty and calls it global responsibilities. Here’s the peace system built and the country’s greatest asset in the an India just a diplomatic step sustained on the value systems 21st century. “Maintain that, and away from a permanent seat in India holds dear at home and true leadership in our globalis- the UN Security Council. He abroad, as Tharoor envisages? ing world—the kind that has to prods India to utilise its strategic For now, Pax Indica is an do with principles, values and partnership with Washington to insightful look into the world of standards—will follow.” What wrest that elusive seat in order to diplomacy for every Indian.

www.ibef.org august-september 2012 59 RURAL update Improving the Quality of Life An organisation is quietly at work in the southern state of Andhra Pradesh to wean farmers away from costly inputs and chemical pesticides to sustain farming. By Santosh Kumar

ust eight years into existence, including ecofriendly biopesti- try acknowledge. So when we Centre for Sustainable Agri- cides and agronomic methods talked about pesticides—its Jculture (CSA) has developed to improve soil fertility. It is a bad effects—farmers are keen paradigm shifting sustainable community-based model provid- to adopt measures that can models of farming. One of ing a single window platform for prevent them. Our research these—Community Man- sustainable livelihood improve- helped us evolve good practices aged Sustainable Agriculture ment to small landholders. The and we could convincingly com- (CMSA)—is today practiced on major thrust of CSA, registered Dr GV municate it to the people,” says more than two million acres or as a Trust in 2004, is to improve Ramanjaneyulu Ramanjaneyulu. roughly 10 per cent of cultivated the quality of life of farmers by is the Executive The life of the farming commu- Director of area in Andhra Pradesh. promoting environmentally safe nity has significantly improved Centre for “’We believe that agriculture and sustainable methods, espe- Sustainable and the costs of production should be understood in its cially in tribal and dry land areas. Agriculture reduced from `5,000 to 15,000 social, cultural, political, eco- The CSA’s one outstanding (CSA). He has (US$ 89.2-276.9) across crops been working nomical and ecological contexts achievement is the implementa- per season. The reduction in in the field of and that one size fits all kinds tion of Non-Pesticidal Manage- sustainable pesticide use has helped improve of solutions offered by modern ment (NPM). Understanding agriculture the health of the community agriculture will not work,’’ says the import of agriculture on and promoting greatly. “We work with several environment Dr GV Ramanjaneyulu, Execu- climate change and the conse- like-minded organisations such friendly, non- tive Director, CSA. “Hence we quent imperative for develop- chemical as Alliance for Sustainable and designed our programmes taking ing sustainable agriculture pesticide-based Holistic Culture that are spread these parameters into account.’’ practices, the organisation agricultural across the country,” he says. practices among The CMSA approach overturns pioneered the concept of NPM. Regulation of some of the most the grassroots. the traditional expensive chemi- “Pesticides make up a large unsustainable technologies by cal pesticide input methodology chunk of production costs and presenting viable alternatives— and replaces it with one using also have severe health impact be it to Bt brinjal or Endosulfan— physical and biological means which farmers across the coun- is the result of this network.

60 august-september 2012 www.ibef.org For updated news-analysis on Indian business and economy Log on to www.ibef.org