Monday, September 10, 2012

Powerfully Transient

India has won the seat at a crucial time. It must use it to push, not just for permanent membership, but also for reforming the Council

It was quite a milestone for India to win the two year non-permanent membership in the UN Security Council (UNSC). All the hard work put together by External Affairs Minister S. M. Krishna and Ambassador Hardip Puri, India’s permanent representative to the UN and their teams has paid off. Although this undisputed victory with an overwhelming majority will boost the confidence of India diplomatically, the election holds even more promise than is apparent.

Apart from India, which won the election with 187 out of 192 votes, Germany, South Africa, Portugal and Colombia also secured the five replaceable seats for non-permanent membership, which will begin from January 2011. Although the UNSC’s non-permanent election process is quite democratic, five permanent members (US, UK, China, France and Russia) enjoy significant influence in the selection process.

But then, this win for India is certainly not a surprise as there was widespread consensus. Japan is already a non-permanent member and thus can’t participate in the voting; and thankfully, for reasons temporary, US openly supported India. This proved to be the most timely gesture of goodwill that Obama could have extended in the run up to his visit.

This is the seventh time that India became a member since the Council came into existence in 1946. Japan and Brazil have secured membership ten times, Argentina eight times, Canada, Italy and Pakistan have got it six times each. In line to this thinking, we must realise that a non-permanent membership helps little to strengthen a nation’s diplomatic influence over global affairs.

Still, to India’s defence, this time things may turn out to be a little different. Three out of the G4 nations – India, Brazil, Germany and Japan (who are striving to be permanent members) – will be present in the council in 2011 (Japan being the exception); this is the year when the issue of reforms or expansion of the Security Council will be discussed and debated. The non-permanent members can push forward the issue of permanent membership more boldly than ever before. And their candidature is also competent enough. To be a member of the UNSC, a country should have either donated significantly to the UN or should have participated in UN missions. Japan and Germany are the second and third largest donors to UN missions while Brazil and India are the largest contributors of troops in UN peacekeeping missions.


Source : IIPM Editorial, 2012.
For More IIPM Info, Visit below mentioned IIPM articles.
 
IIPM : The B-School with a Human Face

 
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Saturday, September 08, 2012

Plant a day!

Each Plant nourishes many organisms; imagine the Eco-System with 20% of plant species gone...

It is famously said that ten trees planted today would not suffice or fill the void left behind by the five cut yesterday. So, for each tree forced out of existence, a complimentary farewell is also bid to a host of organisms and micro-organisms dependent on the demised tree. But imagine the fate of the ecosystem when an entire ‘specie’ gets wiped out! Royal Botanic Gardens, Kew, together with the Natural History Museum (London) and the International Union for Conservation of Nature (IUCN), have compiled a shocking report, which reveals that almost 20% of the known 380,000 plant species face the petrifying risk of extinction. Natural reasons account for only 18.7% of the danger posed, the rest is man-induced mainly due to irresponsible agriculture (18.7%), harvesting (14.4%) and industrialisation (10.4%).

Renowned botanist Dr. Deepak Acharya however is of the opinion that the two main man-made causes are “bio-piracy” and the persistent problem of deforestation, induced by rigorous industrialisation. “Bio-piracy,” bemoaned Dr. Acharya to B&E, “is the most worrying predicament”. He highlighted, “Of the 400 species of plants used for medical reason, only 40 of them are being re-cultivated and even that dismal effort is disorganised”. The looming fact is quite clear. These 360 sidelined species would be extinct even before we realise and worse, their invaluable medicinal value would be forever lost too.

Safed Musli, the plant with versatile medicinal values, is one such example. With a gradually increasing annual demand currently standing at 35,000 MT, only about 15,000 MT is finding its way into the market. Alarmingly, the supply figure was 20,000 MT just five years back. Economics aside, this exceptionally-inverse demand-supply relation is due to the over-exploitation of the specie.


Source : IIPM Editorial, 2012.
For More IIPM Info, Visit below mentioned IIPM articles.
 
IIPM : The B-School with a Human Face
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Thursday, September 06, 2012

EXCLUSIVE INTERVIEWS WITH:CEOS AND TOP MANAGEMENT OF INDIA’S LUXURY AUTO GIANTS

The Indian Luxury car market is on the verge of exploding, led by the increasing affluent class. this has catapulted Germany’s big 3 into an internecine and long drawn war. Is their any winner in sight yet? B&E’s Sanchit Verma Gives an incisive sectoral update on the current relative sales figures, positioning issues, production plans...

The scenario is similar with Audi. The more technology oriented German player revised its 2010 targets to 2700 (from 2300), having exceeded expectations by clocking 63% growth with 2178 cars sold in Jan-Sep 2010. This was the best sales performance for Audi ever in India, which shows how it is also gradually climbing the sales ladder. In fact, Audi India’s countrywide vehicle sales in September 2010 grew to 292 cars as compared to 205 units sold in September 2009. If one were to see the Jan-Sep 2010 period, Audi sold 323 units of its Q7 and A8 branded cars during this period; these brands stand at par with the Mercedes-Benz S-class & SL Roadster, which clocked 343 and 421 units respectively in the same period. “We are confident that we will achieve annual sales of 3000 cars, which is more than our revised target of 2700 cars,” said Michael Perschke, Head, India Operations, Audi.

In all, these three have posted total sales of 7178 units between them in the April-September 2010 period, a phenomenal growth of 84% yoy. But the reality is that going forward, all these luxury car makers are now attempting unique strategies that are brilliantly differentiated on one hand and classically positioned on the other.

Pricing and financing differentiation: Pricing matters in India! If you’re selling in India, the faster you understand the concept of value for money, the better for your sales. Take BMW for instance. On October 5, 2010, BMW launched BMW Financial Services as a new business entity in India; this firm is a 100% subsidiary of the BMW Group and will operate as a Non-Banking Finance Company (NBFC) as per the Reserve Bank of India (RBI) norms. In 2010, we’re informed that the BMW Group will invest $50 million (Rs.2.3 billion) in this arm. The reasons are quite obvious. The financing arm is to make the product more accessible to a wider audience. Look at how superbly BMW’s positioning has changed in recent times to accommodate the lower-upper class of Indian society. BMW’s recent advertisements are already offering the 3-Series at an attractive EMI of Rs.19,999 a month. Imagine the potential such a move holds, where hundreds of thousands of well earning middle management in as many Indian companies suddenly become potential customers. K. Kumar, India Manufacturing Head, Deloitte India, echoes this view to B&E, “The most important factor to expand this segment would be to put these cars within the reach of the upper middle class consumer.” Mirroring BMW’s strategic move, Daimler (the parent company of Mercedes-Benz) also announced that their financial services arm will start supporting India sales.

But BMW already has the first mover’s advantage, because while BMW’s financial arm is ready and active as of right now – and the festive season is the most critical of all times – Mercedes’ financial services are likely to be available only by next year. Audi still hasn’t expressed any views towards launching any financial services arm, as their current strategy encompasses significant investments in branding and marketing, exclusive dealerships and after sales service for the upcoming year. Evidently, this financing round is being won by BMW hands down.


Source : IIPM Editorial, 2012.
For More IIPM Info, Visit below mentioned IIPM articles.
 
IIPM : The B-School with a Human Face
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Wednesday, September 05, 2012

Still worth your money?

Douglas as Gordon Gekko (in 1987) floored the audience, and now 20 years and stage-4 throat cancer later, he returns with Wall Street 2. Can Doughlas with Shia LaBeouf, Carey Mulligan and Josh Brolin, pull off the magic again? Even as he fights cancer, the dashing Douglas didn’t look any less in control as he walked the red carpet. Proving right the Wall Street mantra, ‘greed is good’, the premiere saw a turnout of Hollywood’s who’s who, including investor Warren Buffet. Guess the buck hasn’t stopped yet.


Source : IIPM Editorial, 2012.
For More IIPM Info, Visit below mentioned IIPM articles.
 
IIPM : The B-School with a Human Face
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Tuesday, September 04, 2012

Shilpa still shining!

Look who’s promoting Salman Khan’s Dabangg now! It’s Shilpa Shetty, who was present at its special screening and posted tweets on Twitter telling everyone that it’s a must-watch. The actress as usual grabbed eyeballs, and word is that big brands too have their eyes on her. Recently, she replaced Bipasha as the brand ambassador of a honey brand too. Shilpa has shifted base to London, but is still loved to bits in India!


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Monday, September 03, 2012

KHADI: INDUSTRY

The withdrawal of 10 per cent rebate, which was given to the khadi industry around the year, and 20 per cent that was given for 108 days a year to mark the Gandhi Jayanti, has left the local khadi industry in the lurch with many units facing an immediate closure. by Swati Sharma

Khadi institutions are the implementing agencies forwarding rebate benefits directly to the consumers and generate employments. In order to promote market for khadi products, the government had continued through the Khadi and Village Industries Commission (KVIC), a policy of rebate on sale of khadi and khadi products till 2009-10. According to KVIC statistics, the khadi industry had a production of Rs17338. 87 crore as of 2008-09, a sales of Rs22748.19 crore and employment of 103.91 lakh.

New Schemes
The government is mulling to float a flexible scheme—Market Development Assistance (MDA)—as a replacement of the rebates on sales, which will be implemented in the next financial year. The scheme will privilege a financial assistance at the rate of 20% of production value on khadi and polyvastra, which will be shared among artisans, producing institutions and selling institutions in the ratio 25:30:50. It is also believed that the sales will be evenly spread throughout the year and further the institutions will have the flexibility to use the assistance in improving the outlets, products, giving incentives to customers.

Replying to a question in Rajya Sabha, Minister of State for MSME, Dinsha Patel, said that the scheme of rebate on sales caused delay in paying incentives to the institutions so much so that they would have to wait till sale and wait till next year to get the claims reimbursed.

Under the MDA, incentive would be provided immediately after production of the items, and this is expected to ease out the working capital situation of the institutions by ensuring immediate liquidity, which would in turn, ensure timely payment to the artisans, ultimately benefiting the artisans.

According to the 2009-2010 report of the MSME, the value of khadi produced in the country fell from Rs585.25 crore in 2008 to Rs484.45 crore by December 2009; sales dropped by Rs 40 crore. Over 80% of annual sales of khadi products are restricted to the discount season, while less than 20% of sales are made during the remaining 8 months. The khadi commission employs a million artisans out of which 80 per cent are women. In order to show their protest, the Khadi Stock Ashrams in Haridwar protested in front of the shop, weaving khadi on the charkha, showing their resistance in Gandhian style.

Forlorn Hopes
The grimmer portraits of Mahatma Gandhi, grungy and faded colours of the national flags are ignored by passersby that lay unnoticed for years at the Khadi Gramodyog Bhavan in Connaugt Place (the central business district of Delhi), the somnolent air fills the place of its lost history and now even the purpose that it laid for years together, today hang broodingly while made-in-India flashes from one side.

Naresh Kadyan, secretary general of National Khadi & Village Industries Board’s Employees Federation, is running an online petition (change.org) that targets government to oppose these rebate cuts that make a common man suffer. At the time of filing the story, 132 people had signed the petition. He says, “The withdrawal of rebate has hit the mission and due to lack of funds, activities will face huge financial crises. It would definitely make things worse, proper funding, monitoring and honest implementation is the need of the hour.”

Losing Spirit
Khadi was introduced in 1920 as a political weapon and as the best instrument for giving concrete expression to the swadeshi spirit to boycott foreign goods. It is still being used as a political weapon but with a different approach. In those days, khadi rendered an opportunity to every man, woman and child to cultivate self-discipline and self-sacrifice as a part of the non-cooperation movement. However, all these spirits are dying with cultivation of corruption and selfish motives of the new India. On repeated attempts made by B&E to take official reaction on the issue, KVIC officials refused to comment. The khadi industry pleads for a major transformation today. As most of the politicians are shifting from khadi to linen clothes, there’s no one left to cut a figure in the society for khadi.


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Saturday, September 01, 2012

“WE WOULD PREFER AN ORGANIC PATH”

From expresways to Real Estate to cement to power, jaypee group has proved its worth as a diversified ENTITY WITH A FOCUS on infrastructure. In an exclusive Interaction with Manoj Gaur, Executive Chairman, Jaiprakash associates ltd. Priyanka Rai & Deepak Ranjan Patra attempt to find out how the group is planning to elevate itself to a new level

Jaypee Group is India’s third largest cement manufacturer. As per reports, you were planning to expand this business via acquisitions and Greenfield additions. Is that on track?Currently, we have an installed capacity of around 23 million tonnes and are expecting to increase the same to 35 million tonnes by March 2011. At that capacity (considering the fact that the country’s forecasted cement production capacity will be 280 million tonnes at that time) we will have a market share of 14%. Talking about acquisitions, we will wait for opportunities – like the sick cement plant we acquired from the UP government through a high court auction. Because, what we feel is that acquisitions are pricy affairs and ultimately valuations end up quite high putting unnecessary stress on the acquirer. So, instead of such acquisitions, we believe in setting up of new plants and adding to the country’s developments. If things go well, we will only try to increase our production capacity to 50 million tonnes.

As it is said in general, cement industry and cartelisation go hand in hand. What’s your experience about the same?
Look, today India manufactures nearly 230 million tonnes of cement through 130 factories owned by 60 different owners, both national and international. Under such a dynamic environment, cartelisation is quite impossible. It may be there on a regional basis, but not on a large scale. What I believe is that had cartelisation been there, so many cement factories would not have closed down in the past.

But how can you say “it’s not possible”, when the top 5 players are controlling over 60% of the market?I always believed and still believe that there may the possibility of a cartel, but it can not be successful in India.

Yamuna Expressway is one of your landmark ventures and it’s expected to be completed by March next year. How do you think this will add to your value, both in terms of recognition and revenue?
This is a project that will create a benchmark in India. Till date the country has not seen any Greenfield road projects of this size where the government has not contributed a single penny. The revenue model for this project has two streams – toll and real estate – and for us both are equally important integral parts of this project. At present, it’s tough to say how much return we shall generate, but on a rough estimate, gross ROE should be over 25%.


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