A small glimpse of AVIATION

The Indian aviation industry is one of the fastest-growing aviation industries in the world with private airlines accounting for more than 75 per cent of the sector of the domestic aviation market (as of 2006). With a compound annual growth rate (CAGR) of 18 per cent and 454 airports and airstrips in place in the country, of which 16 are designated as international airports, Union Civil Aviation Minister Mr Praful Patel has stated that the aviation sector will witness revival by 2011.
With an increase in traffic movement during December 2009 and increase in revenues by almost US$ 21.4 million, the Airports Authority of India seems set to accrue better margins in 2009-10, as per the latest estimates released by the Ministry of Civil Aviation. This is being primarily attributed to increase in the share of revenue from Delhi International Airport Limited (DIAL) and Mumbai International Airport Limited (MIAL).
Passengers carried by domestic airlines from January-February 2010 stood at 8,056,000 as against 6,761,000 in the corresponding period of 2009—a growth of 19.2 per cent, according to a report released by the Ministry of Civil Aviation.
The Hyderabad International Airport has been ranked amongst the world's top five in the annual Airport Service Quality (ASQ) passenger survey along with airports at Seoul, Singapore, Hong Kong and Beijing. The Hyderabad International Airport is managed by a public-private joint venture consisting of the GMR Group, Malaysia Airports Holdings Berhad and both the State Government of Andhra Pradesh and the Airports Authority of India (AAI).
The US Ambassador to India Timothy J Roemer, has said that the US will work with the Indian government and the domestic private sector to make the country an aviation hub. Speaking at India Aviation 2010, Roemer said that the public-private initiative, US-India Aviation Programme, would work together with the Directorate General of Civil Aviation on helicopter aviation security.
The Airports Authority of India (AAI) is set to spend over US$ 1.02 billion in 2010, towards modernisation of non-metro airports. AAI is planning the city-side development of 24 airports, including those at Ahmedabad and Amritsar. Additionally, 11 new greenfield airports have been identified to reduce passenger load on existing airports, according to Praveen Seth, member-operations, AAI.
The government has also merged national carriers Air India and Indian Airlines into a single entity, the National Aviation Company Ltd (NACIL). The civil aviation ministry has prepared a blueprint to convert Delhi airport into an international hub for passenger airlines with effect from August 2010 to help the airport utilise large amounts of additional capacity that will be ready by July 2010. Under the plan, NACIL will set up its hub in Delhi.
Investment Policy
The consolidated document on FDI policy was released on March 31, 2010.
Currently, for the civil aviation sector:

• FDI up to 100 per cent is allowed under the automatic route for greenfield projects.
• For existing projects, FDI up to 100 per cent is allowed; while investment up to 74 per cent under the automatic route and beyond 74 per cent under the government route.

The Road Ahead
Investment opportunities of US$ 110 billion are being envisaged up to 2020 with US$ 80 billion towards new aircraft and US$ 30 billion towards development of airport infrastructure, according to the Investment Commission of India.

• Indian aerospace companies are growing too. Hindustan Aeronautics Limited (HAL) was ranked 40th in Flight International's list of the top 100 aerospace companies last year.
• Aircraft manufacturing major, Boeing, is in the process of setting up the US$ 100 million proposed Maintenance Repair Overhaul (MRO) facilities in Delhi. Air India is also in the process of launching a Cargo Hub in Nagpur while Deccan Aviation has already started one from the city.
• GE Aviation and Air India will jointly invest US$ 90 million to set up a maintenance, repair and overhaul (MRO) facility in Mumbai.
• Indocopters Private Ltd, distributor for Eurocopter helicopters in India, is planning to set up a helicopter maintenance, repair and overhaul (MRO) facility in Bhubaneswar, the company’s fourth service centre in the country.

Ten industries to set up ITCs

Kolkata/ Bhubaneswar: To meet the manpower requirement for upcoming industries in the state, the Orissa government would sign memorandum of understanding (MoU) with ten industries for setting up of Industrial Training Centres (ITCs). The partnering companies included Tata Steel, Balasore Alloys, Paradeep Phosphate (PPL), Indian Oil Corporation, Monnet Ispat among others. The ITCs are proposed to be developed in public-private-partnership (PPP) mode and the state government would provide the required land. The MoU is slated to be signed on 24th of this month, official sources said. Though twenty seven industries have given proposals for setting up ITCs in the state, the government would ink pact with ten of them in the first phase. The Orissa government targets to open at least one ITI in every block of the state. It may be noted, out of 314 blocks in Orissa, 116 blocks don’t have ITIs. At present, the state boasts of 30 ITIs in the government sector and 510 in the private sector. Similarly, the government has 13 polytechnics and 23 more are planned to be opened soon.

3 legal changes that can change your life

What does Parliament have in store for us? Which are the laws that are going to change our lives?

1 Goods & Services Tax 
The government intends to introduce a goods and services tax (GST) regime in India by April 2010. The proposed GST will integrate most indirect taxes on goods and services at state and central levels. GST will bring all these taxes under one head that will be levied at the point of sale, instead of the point of origin.

To a large extent, this means there will be cost reduction at the point of origin. This is because GST is to be levied on the value added at each stage of sale and purchase or supply with an in-built credit mechanism such that the tax is a pass-through for businesses, and the tax-burden is borne by the ultimate customer.

Tax compliance is expected to go up as GST will rely on computer-enabled systems. So a unique identification number could generate a centrally captured trail all the way from the manufacturer to the end retailer. Today, if it wishes, a major retailer can opt not to register select purchases in its system and make cash purchases.

For companies, the benefit will be in the form of lower tax rates owing to a larger tax base and better compliance.

2 Companies Bill 2009

Last year the Companies Bill 2008 was introduced in the Lok Sabha but did not become law. It was re-introduced in Parliament as the Companies Bill 2009 and is likely to become law in 2010.If it does, it will likely bring about significant changes in the way business is done in India, make it easier to start and close businesses, and protect shareholders. The bill, introduced by Corporate Affairs Minister Salman Khurshid, is centred on stakeholder protection, with provision for class action suits that allow a group of people with a similar grievance to file a joint petition.

It has met with stiff resistance from certain quarters of the legal fraternity who believe the new bill will only create confusion and overlap and conflict with numerous existing laws.

3 Fast Tracking Justice

Weighed down by the burden of legal reform, Law Minister Veerappa Moily has taken on the biggest bet of his career, yet. In October this year, he unveiled an audacious roadmap for judicial reforms to reduce the average life of litigation from 15 to just three years, a task he wants accomplished by December 2011. The multi-pronged initiative looks promising with provisions for a National Arrears Grid to compile accurate data and appointments for additional high court and lower court judges temporarily to bring down the court congestion. 

One of the proposals includes the setting up of a special purpose vehicle involving the likes of TCS, Infosys and Wipro as well as Innova (the satellite communication provider). The SPV will set up e-systems that will enable the justice administration system to move faster. The SPV will also recruit competent hardware and software personnel who will be attached to the high courts. The techies will also take classes on e-systems for personnel with district courts.

INDIAN TEXTILE INDUTRY

The Indian textile industry provides direct employment to an estimated 35 million people and contributes four per cent to gross domestic product (GDP) in 2008–09. The industry is dominated by small players across the value chain – raw materials, spinning, weaving/knitting, processing and garment manufacture. India has availability of a variety of raw materials – cotton, silk, jute and wool and in terms of cost, India has an advantage over comparative countries. India has abundant availability of manpower with skill sets across all activities of the textiles value chain.

India to overtake China in growth by 2018: EIU

India will overtake China to become world's fastest growing economy by 2018, said the Economist Intelligence Unit (EIU), the research arm of London-based Economist magazine. Because of the favourable demography — higher percentage of working population — India's growth rate will continue to remain on the higher side, said Anjalika Bardalai, senior analyst at EIU. At present, China is the fastest growing economy in the world. Bardalai said considering strong fundamentals, "our long range forecast suggests that India will sustain an average annual growth rate of 6.4% to 2030." India will take the lead not because of its growth rate is likely to attain double-digit level but China's growth rate will moderate with development of its economy, she added. However, for the current financial year, Bardalai said Indian economy would grow at 6.8% only. But, this is not comparable with figure of 7.2% projected by the government as EIU has adopted a different methodology to calculate the rate. "Our projection is based on expenditure in economy and is not on factor cost as done by the Indian government," she explained. She said the growth rate will pick up to 7.7% in 2010-11 and 8% in 2011-12. "Continued domestic consumption, spurred by rising income and a growing middle class, will be primary drivers behind India's growth. At the same time, high savings and investments will help India achieve the higher growth rate." According to EIU, inflow of investments through foreign institutional investors (FIIs) will touch $75 billion by 2014, which is currently hovering at around $36 billion. EIU felt that the biggest hurdle to achieve higher growth is the high inflation and infrastructural bottleneck. As the inflation has already risen close to 10% in February, the monetary pressure is likely to increase.

GSK, Nestle, Coca-Cola & Dabur top up effort to tap rural consumers

New Delhi: Consumer product makers such as GlaxoSmithKline, Nestle, Coca-Cola, PepsiCo, Hindustan Unilever, Marico, Godrej and Dabur are rushing to the bottom-of-the-pyramid market with custom-made products six years after management guru CK Prahalad said consumers with incomes less than $2 a day can be a profitable segment for marketers.
Estimated at close to 350 million, the bottom-of-pyramid (BOP) consumer segment is the biggest and perhaps the fastest growing in the country with about 40 million families making the jump from poverty to the BOP club every year. Marketers are no longer only betting on smaller packs of existing products to tap the fortune at the bottom of the pyramid; they are also looking to roll out products specially made for the poor.
GlaxoSmithKline Consumer Healthcare (GSKCH), foods company Nestle and beverage maker Coca-Cola have already entered the market with products created for BOP consumers, while PepsiCo is set to follow suit. Others such as Hindustan Unilever, Marico, Godrej Consumer Products and Dabur too are learnt to be working on products for the BOP segment.
GlaxoSmithKline is rolling out Asha — a milk food drink from Horlicks for rural consumers — in Andhra Pradesh; Nestle is promoting Maggi noodles at Rs 4 and Maggi seasoning at Rs 2 for low-income group consumers beginning with Mumbai’s Dharavi slum; Coca-Cola has begun selling a powder-based beverage called Vitingo at Rs 2.50 per sachet across villages in Orissa; and PepsiCo’s global chairman & CEO Indra Nooyi has announced that the company is working on a beverage or snack priced between Re 1 and Rs 5 for people ailing from malnutrition and deficiencies.
GlaxoSmithKline’s Asha, which is 40% cheaper than the regular variant of Horlicks, is the first product from the UK-based MNC designed for rural consumers. “Alongside, we are building a robust go-to-market model to ensure the products reach the right consumers because it’s not enough just to have the right products,” Zubair Ahmed, managing director of GlaxoSmithKline, said.
The company will continue to identify and bridge need gaps for bottom-of-the-pyramid consumers, particularly in terms of nutrition products and their availability, he added. About three weeks ago, the Indian arm of Swiss foods company Nestle introduced low-priced fortified meals under its flagship Maggi instant noodles brand.
Shivani Hegde, general manager (foods) at Nestle India, said addressing micronutrient malnutrition was a challenge for the country. Ms Hegde said Nestle would provide nutrition education to the base of the pyramid and was launching its first such programme at Dharavi slums in Mumbai.
Coca-Cola’s Vitingo — a fortified beverage in 18-gm sachets at Rs 2.50 each — is again a first for the beverage maker. “Buoyed by the success of the pilot project for Vitingo in Sambalpur, Orissa last year, the project is now being scaled up to 30 districts of Orissa,” a Coca-Cola India spokesperson said. The company has tied up with NGO and micro finance institution BISWA in Orissa for the same.
Economists, meanwhile, say companies cannot afford to paint all bottom-of-the-pyramid consumers with the same brush. “The potential at the bottom of the pyramid is immense, but companies will need to understand consumer spending patterns carefully,” says Dr Rajesh Shukla, senior fellow at the National Council for Applied Economic Research (NCAER).
But for now, with the likes of HUL, Godrej Consumer Products, Marico and Dabur set to join the race, the poor in the country may soon have something to smile about.

Hyundai unveils i10 Electric ,The electric version of the compact car.

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Expecting more customers is what Hyundai had stated while signing the MoU with Indian Bank and so it seems that while trying to impress those potential customers’ needs they have unveiled the electric version of the i10. Termed as a zero-emission urban commuter vehicle, the hatchback from the Korean company consists of a 49kWh electrical motor and a 16kWh battery, incorporating Li-Poly batteries producing the same power while weighing less and being more efficient when compared to NiMH batteries. Charging the battery pack will take five hours from a 220V outlet but if you plug it into a 413V outlet it charges up to 85% in fifteen minutes. The driving range is said to be 160 km with a 130kmph top speed.   Here is the Press Release: New Delhi, January 06, 2010: Hyundai Motor India Ltd, the country’s largest car exporter and second largest car manufacturer, today unveiled the electric version of the immensely popular compact car - i10 at Auto Expo 2010 in New Delhi. Considered as a breakthrough in the alternate fuel vehicle segment, the i10 electric ushers in a new era of mobility – a zero-emission  urban commuter vehicle. The i10 Electric made its world debut at the Frankfurt Motor Show in September, 2009. Slated for a limited series production run in 2010 in the home market of Hyundai - South Korea, the all new i10 Electric is an embodiment of Hyundai’s radical, transformative vision for the future and the culmination of decades of investment in research and development.   Key Characteristics of  Hyundai i10 Electric   •      Zero Emission •      Low Kerb weight (1000Kg) •      Driving range of 160 km on a single charge •      Highly efficient LiPoly Battery •      Easy for urban commuting  On the occasion, Arvind Saxena, Director (Marketing & Sales), HMIL, said, “A growing awareness amongst consumers for all things green inspired us to introduce the electric version of our immensely popular compact car – i10.  It is truly a real-world car with zero emissions, and the unveiling today, marks the first step in what is sure to be an exciting journey - for people all over the world, for Hyundai and for the industry. We hope that the heightened interest in electric vehicles will present us with a huge opportunity to bring in EV technology to the Indian market in the near future.”

India ranks second in consumer confidence index

New Delhi: India ranks second with 117 points in consumer confidence in the fourth quarter of 2009, according to the Nielsen Global Consumer Confidence survey. The survey results indicate that the recovery from the global economic downturn is faster in India as compared with other countries in the world.
Further, the survey also points that countries with higher willingness to spend are showing better signs of revival. Indonesia tops the survey with 119 points with Hong Kong, China, Singapore and Brazil also showing accelerated recovery.
The survey highlights that eight of the top 10 most confident markets were from Asia Pacific in the fourth quarter of 2009. The survey also revealed that Indians are most optimistic about job prospects in 2010. 83 percent of the Indian consumers expect things to improve in 2010. India is followed by Indonesia at 70 percent.

The Retail Promise

What does the next decade hold for retailing in India? With the economy expected to deliver around 8 per cent growth for the next many years, the domestic retail market is likely to more than double and probably hit the $900-1,000-billion mark by 2020.

As we enter 2010, we already have some of the country's and the world's biggest businesses engaged in retail activity. These include Tata, Birla, Ambani, Bharti, Essar, Mahindra & Mahindra, and RPG in addition to exceptional entrepreneurs that have successful ventures in Future Group, Shoppers Stop, Landmark (Dubai) and others. If the current decade has turned out to be a decade of slower, but steady, evolution of modern retailing in India, the next decade will finally see a revolutionary change that will undoubtedly make a very visible impact on the, by then, 1.3-billion strong India in 2020.

The hard sellers

Pantaloon retail: They changed the way Indians shop by providing air-conditioned comfort at kirana pricing under one roof.It has over 13 million sq ft retail space covering 1,000 stores. Pantaloon India Retail has a turnover of Rs 6,342 crore.Big Bazaar is 60 per cent of that.

Tata:The group has a significant presence in retail under different brands: Trent and Star Bazaar (its hypermarket stores),Westside for lifestyle retail, Landmark for books and music and Titan for watches and sunglasses.

Reliance retail: Despite being a late entrant in retail, Reliance has managed to set up 700-odd stores, including those of Reliance Fresh and Reliance Mart.

The mobile store: The Essar Group-owned chain is the big daddy in mobile retail with 1,400 stores across the country.It is planning to double its network to around 2,500 stores by March 2012 and launching its own mobile phones soon.

RPG: Perhaps one of the oldest groups in the retail business in the country,the RPG group has Spencer's Retail,a multiformat retail format with 250 stores, Music World and Books & Beyond.

Spin-offs

Products of commerce

Malls: They have sparked off a consumption boom, whether it is fashion or eating out.From just three malls in 2002,the country has about 120-odd malls at present. Going by a study,another 300 malls will be added by next year.

Parking management: With the arrivals of malls came vehicle parking. It is estimated to be a Rs 300-crore business.

TeleShopping: Peddles too-good-to-be-true products.Aired late at night, the market is estimated to be worth more than Rs 250 crore.

Mall rats: India's BPO boom spawned a generation of mall rats who,with their upwardly mobile lifestyles and high spending power,hung around the malls over the weekends burning plastic.

Retail therapy: Shopping always helps lift the spirits. Truly therapeutic.

Plastic money: Credit card usage spiked with the entry of malls and organised retail. There are over 160 million debit and credit card holders in India today.  

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