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Indian Securities Industry : E Bizwire  August 2012
 

Indian Securities Industry : E Bizwire August 2012

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Indian Security Service ...

Indian Security Service
India is a land of entertainment and Indians are obsessed with noise. Thanks to that, abundant concerts, programmes, shows and other public gatherings are organized throughout the country. But along with that, we also quite frequently hear about such events being cancelled. No prizes for guessing! Security of such huge mass of people is always an issue, sometimes solved and sometimes not. Terror threats, lack of security and subsequent chaos; is all it takes to turn a well planned event into a disaster.
So much chaos and you expect a business opportunity here? No kidding! If you are a person who likes to network and has an impressive list of contacts, then this is the avenue for you.
If you happen to know people in the entertainment industry, are on good terms with the police officials and are familiar with a slew of event organizers, then there you go! Relevant registrations and license is all you need and you can take it from there. What more? There are enticing prospects to expand to security guards services as well!

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    Indian Securities Industry : E Bizwire  August 2012 Indian Securities Industry : E Bizwire August 2012 Document Transcript

    • Industry of the Month “Security Industry in India”eBizWire Vol . I Issue. VII, August 2012 InsightBiz India News 2Biz Policy Updates 3The Indian Security Industry 4Business Idea of the Month 7StartBizIndia Discussion Platform 8Upcoming Business Summit 9Contact us 10 For more info on Business setup visit www.startbizindia.in Page |1 For Business setup queries email at neha@indiacp.com or call at 011 40622239
    • Biz India News Headlines• Public sector miner Coal India Ltd has lined up an investment of Rs 7,500 Coal India to invest Rs 7,500 crore to develop railway tracks and related infrastructure to evacuate coal cr on rail infrastructure in 3 from Chhattisgarh, Jharkhand and Odisha. These would help the company to States evacuate around 100 million Tonnes (mt) of additional coal from each of the States on 16th July 2012.• The Central Board of Secondary Education (CBSE) is likely to take the lead CBSE agrees to introduce in introducing financial education in its post primary level curriculum after financial education in school th taking a leaf out of Reserve Bank of Indias financial literacy goal on 17 July curriculum 2012 RBI recognises that basic knowledge about monetary aspects play a key role in financial inclusion and inclusive growth. Imparting financial education among the masses at the early stage of a life cycle can make a real difference in a country where many do not get the opportunity to study beyond school level.• th On 18 July 2012, Ford India has expanded the diesel engine production Ford expands diesel engine capacity at its plant in Maraimalainagar, near Chennai. This, the company capacity at Chennai plant hopes, will help address the supply constraint it faced early this year. In the first quarter of the year, Ford India’s Chennai plant was unable to meet the demand for diesel power-trains. Customers had to wait for three months to have their cars delivered.• th Mankind Pharma set to tap On 19 July, 2012, Mankind Pharma planned for a major turnaround over the next two to three years. The Rs 2,000-crore Company, best known for its core drugs market consumer brands like Prega News, Manforce, Unwanted-72 and Kaloree-1, is now eyeing the market for diabetes and cardiovascular drugs to record growth in both turnover and profit.• th On 20 July 2012, Onco Therapies, a wholly owned subsidiary of pharma Strides Arcolab unit gets company Strides Arcolab, has received two US FDA (Food and Drug USFDA nod for anti-cancer Administration) approvals for ‘Fluorouracil Injection USP’. Fluorouracil is part injection of the oncology portfolio licensed to Pfizer for the US market and expected to be launched shortly, a press statement said. Fluorouracil is a chemotherapy drug which interferes with cells making DNA and RNA, and stops the growth of cancer cells. It is used to treat several types of cancer including colon, rectum, and head and neck cancers.• nd On 22 July, 2012, Pranab Mukherjee was elected the 13th President of Pranab Mukherjee elected India, capping the long innings of the veteran Congress leader and the 13th President of India partys chief troubleshooter over the past eight years. The former finance minister and the candidate of the ruling UPA, who garnered 69.3% votes, defeated his rival PA Sangma, the candidate backed by AIADMK, BJD and NDA (minus Shiv Sena and JD-U), by a bigger than expected margin.• The Diamond business in India is growing at 20 % year on year. Globally the India to contribute 20% of diamond market is seeing a single digit growth of 3-5 percent. “Forevermark Dee Beers’ diamond sales in is growing at 50 percent worldwide –well above the global growth. But our 5 years base is small since we launched only in 2009,” said Mr. Lussier, De Beers’ rd ED, External and Corporate Affairs on 23 July, 2012. For more info on Business setup visit www.startbizindia.in Page |2 For Business setup queries email at neha@indiacp.com or call at 011 40622239
    • Legal Headlines Biz Policy Updates• New Investment Scheme for QFIs • New Investment Scheme for QFIs With a view to promoting further investment in India by Qualified Foreign Investors (QFIs), Reserve Bank of India has come out with a Scheme for Investment for QFIs in Indian corporate debt Securities vide its A. P. (DIR Series) Circular No. 7 dated 16.07.2012. The Indian Corporate Debt securities means listed Non-Convertible Debentures(NCDs), listed bonds of Indian companies, listed units of Mutual Fund debt Schemes and “to be listed” corporate bonds. QFIs can invest in these securities subject to certain terms and conditions enumerated below: • QFIs are required to open a single non-interest bearing Rupee Account for routing the receipt and payment for transactions relating to purchase and sale of securities. • The funds in this account shall be utilized for purchase of eligible securities for QFIs or for remittance (net of taxes) outside India. • Sale of eligible debt securities can also be done through a registered stock broker on a recognized stock exchange in India. • QFIs would be allowed to open a single DEMAT account with a QDP in India for investment in all eligible debt securities • Total overall ceiling of investment is USD 1 billion. This limit shall be over and above USD 20 billion for FII investment in corporate debt. • Foreign inward remittance shall be through normal banking channel in any permitted currency (freely convertible) directly into the single non- interest bearing Rupee account. • QDPs will ensure KYC of the QFIs as per the norms prescribed by SEBI. AD Category-I banks will also ensure KYC of the QFIs for opening and maintenance of the single non- interest bearing Rupee accounts as per the extant norms. • The pricing of all eligible transactions and investment in all eligible securities by QFIs under this scheme shall be in accordance with the relevant and applicable guidelines issued from time to time • In addition to the reporting to SEBI as may be prescribed by them, QDPs and AD Category-I banks (maintaining QFI accounts) will also ensure reporting to the Reserve Bank of India in a manner and format as prescribed by the Reserve Bank of India from time to time. Relaxation:- No more requirements for opening and maintenance of a single rupee pool bank account by the QDP and QFIs can henceforth invest in all ‘eligible securities for QFIs’ through a single non- interest bearing Rupee Account. For more info on Business setup visit www.startbizindia.in Page |3 For Business setup queries email at neha@indiacp.com or call at 011 40622239
    • Indian Security MarketThe Indian Security IndustryWith 28 states, 7 union territories and a population of 1.22 Billion; India Investigationsure is a huge country. With the huge size comes a huge list of needs. ServicesYou would say Food security, Education, Infrastructure, Transport, GoodSanitary conditions, Social welfare et al. Did you say Security? Manned SecurityMaslow, a world famous psychologist known for his hierarchy of needs;brought to paper the thought which people generally fail to realize. Thesecond most important need after food & shelter is the need for protection Security Systems& security. That comes even before the need for love, social esteem andself-growth. Believe it or not; ask yourself and you’ll know it’s true. SecurityThough we hardly notice it, security finds a place in the country as a full- Assessmentblown security industry which is growing steadily year after year. In fact,it’s true that there are more security guards than the number ofpolicemen. Fire Detection“The private security industry is growing rapidly around the globe andemploys twice as many people as governments have police officers” REUTERSThe security Industry can broadly be categorized into 2 parts; SecurityParticulars Services Sector Systems Sector IndustryClassification Private manned Security through guarding (i.e. security devices (i.e. Bank guards) & Investigation alarms, system Services Systems Services integrators, CCTV, Access Controls) Statistics G4S, SIS, Tops, SDB, Honeywell, GE, • Globally, US$150Major Players Cisco, Peregrine, Bosch, Tyco, billion industry, which Checkmate, Premier, Siemens, HID, etc is quite huge GI Security among • Growth rate of 20% others over past 10 years and would achieve a rate of 25% annually in future • rd 1/3 spend on airportServices Sector:- security • Number of SecurityThis sector by and large comprises of the manned guarding services and Companies: 15000it dominates the Security industry in India. It has some giant players whichoperate nationwide through their regional and city offices. • Number of Private Guards: 5.5 million approx.They even provide in-house training facilities and job orientationprogrammes. There are smaller companies as well but owing to the less (Source: Security Report infunds available; the quality of their services cannot be compared. ASSOCHAM in 2011) For more info on Business setup visit www.startbizindia.in Page |4 For Business setup queries email at neha@indiacp.com or call at 011 40622239
    • The Indian Security Industry Security Equipments MarketAround 15000 security companies employing about 55 Lakh securityguards, the Indian security services industry is touted to grow at a veryhigh rate as per the report on Security Industry by Assocham. Not onlythis, the industry happens to be the country’s largest corporate tax payeras per the Central Association of Private Security Industry (CAPSI). Thechange in the growth rate is a substantial development because justbefore the barbarian terrorist attacks in Mumbai that shook the wholecountry; the security sector was witnessing a growth of 20% per year.The government is the major player in ensuring security. A number ofinnovative projects like Crime and Criminal Tracking Network andSystems (CCTNS), Immigration, Visa and Foreigners Registration &Tracking (IVFRT), National Intelligence Grid (NATGRID, etc. are beingimplemented where tremendous opportunities exists for the private sector.Systems Sector: - Gadgets used:Started with very basic devices like bank alarms, this sector has rapidly • CCTVsgrown to include devices made with the state-of-art technology like • Access ControlCCTVs, Access Controls, Intrusion Detectors, Door intercoms, etc. It is Systemsmajorly an import based sector with more and more foreign players • Metal Detectorscoming to India and collaborating with the domestic businesses, • Security Doorsappointing distributors and offering sales & after sales support. • Door IntercomsThe security equipment is largely imported from USA, UK, Germany, Gadgets imported from differentSingapore, Italy, Hong Kong, Israel, Japan, Korea, China and Taiwan. countries like Israel, China, Korea, UK and USThe framework regulating the Security Agencies:- Steps to start SecurityTo improve the benchmarks for private security in the country and Business in India:regulating the industry through a licensing process, Private Security • Register Business EntityAgencies Regulation Act was enacted in 2005. The act therefore setsforth various standards and requirements which need to be fulfilled if a (Company/LLP)Private security agency wishes to get licensed. Some of them are: • Obtain Basic Tax Numbers PAN & TAN • 160 hours of training before deployment. • Owners and major shareholders of the agency to be citizens of • Register under Labour India. (Foreign firms are however allowed to enter into a laws relationship with domestic ones) • Register under Shops & • Verification of antecedents of the person wishing to start a business in private security. Establishment Act • Maintenance of registers containing details of security officials, • Get PSRA license managers, supervisors, clients and other such particulars as may be prescribed. For more info on Business setup visit www.startbizindia.in Page |5 For Business setup queries email at neha@indiacp.com or call at 011 40622239
    • The Indian Security IndustryHow to get registered as a Private Security Agency:-The following simple steps need to be followed to get registered as aPrivate Security Agency:• Registering your business venture after checking the availability of the desired name.• Registering for Income Tax and other Statutory Authorities i.e. applying Companies in Security for basic tax numbers; Industry in India i. PAN ii. TAN iii. Service Tax• Registering your Domain Name• Opening a Current Account with the Bank• Obtain License under Private Security Agencies (Regulations) Act, 2005 (PSRA)• Registration under various Labour Laws• Registration under Shops & Establishments Act, 1948• Arranging for guards and security equipmentsChallenges faced by the Security Services Sector:Though the industry is flourishing, some bottlenecks which are mentionedbelow continue to plague the sector.• A typical security guard in the country generally lacks proper training; is often under-screened, not properly supervised and not paid satisfactorily.• The industry still hasn’t bloomed properly. The quality of officers is improving but only gradually; and hence that difference in the quality of services offered is not very prominent in spite of the increasing investments in this sector.• Though guards are trained in areas like firefighting, fitness, reading & Security Service writing in English, the training needs to be more rigorous. Business in India:• Lack of uniformity in adoption of the Private Security Agencies (Regulations) Act 2005 has caused inconsistency in the security of one • Guarding Service state and the other. Only 10 states out of the 28 have adopted the Act so far. Soon, 3 more states are expected to follow the suit. • ATM Security• Some business groups are at loggerheads with the State Governments which is a cause for delayed implementation of the law in those states. • Background Screening• Some states have their own regulations as far as the security is concerned which makes it unclear as to which law is given precedence • Manpower Consultancy over the other. Especially after the Mumbai attacks, the government is facing a lot of pressure to grant license to security guards to carry • Event Security weapons For more info on Business setup visit www.startbizindia.in Page |6 For Business setup queries email at neha@indiacp.com or call at 011 40622239
    • The Foreign Comrades The Indian Security Industry A big positive for the sector is that players in the foreignForeign Direct Investment market are coming forward toThe FDI in the private security sector is limited to 49%. It seems to be the collaborate with the domesticperfect proportion which this industry can expect because of the following agencies. Such partnershipsadvantages: can do a world of good for the Indian security industry. • It allows the indigenous security firms like SIS to gain a strong Interest has been shown by foot-hold in this fast growing sector. foreign entities in the following way: • Foreign players bring along expertise through their tie-ups; which is genuinely important for the security of our country.  Joint venture between ARES Group (Israel) and APS Group (India), Source: FDI policy with the Israel firm providing consultancyBusiness IDEA OF THE Month and training to the Indian partner.  Israel Military Institute offers training courses for Indian Security Executives.  American consultancy, Events Security Service AFI International has offered to provide India is a land of entertainment and Indians are obsessed with training to third-party noise. Thanks to that, abundant concerts, programmes, shows private security officials and other public gatherings are organized throughout the of its clients. It first country. But along with that, we also quite frequently hear about conducts an audit to such events being cancelled. No prizes for guessing! Security of figure out the weak such huge mass of people is always an issue, sometimes areas in the training solved and sometimes not. Terror threats, lack of security and protocols of the client subsequent chaos; is all it takes to turn a well planned event and then works on into a disaster. addressing the problems. So much chaos and you expect a business opportunity here? No kidding! If you are a person who likes to network and has an impressive list of contacts, then this is the avenue for you. If you happen to know people in the entertainment industry, are on good terms with the police officials and are familiar with a slew of event organizers, then there you go! Relevant registrations and license is all you need and you can take it from there. What more? There are enticing prospects to expand to security guards services as well! For more info on Business setup visit www.startbizindia.in Page |7 For Business setup queries email at neha@indiacp.com or call at 011 40622239
    • StartBizIndia Discussion PlatformNRI wants to open a Garment Manufacturing Unit in Free Zone in India.He wants to manufacture or import the raw materials from outsideIndia and export the finished goods back. Please advice for suitablelocation. What is the minimum investment required to set up theproject? Can he apply for PAN Card in the capacity of NRI?Free Zone covers SEZ (Special Economic Zone) and EOU (ExportOriented Unit). Since, you want to manufacture garments in India andexport it to outside India, so, it is recommended to choose setting up ofEOU (Export Oriented Unit). The biggest advantage of setting up EOU isthat the unit can import capital goods, raw materials, consumables,packing material, spares etc. without payment of customs duty. Similarly,these can be procured indigenously without payment of excise duty.Second hand capital goods can also be imported.The incentives are as follows:-a. Exemption from customs/excise duties.b. Income Tax exemption on income derived from the business of development of the EOU in a block of 10 years in 15 years under Section 80-IAB of the Income Tax Act.c. Exemption from minimum alternate tax under Section 115 JB of the Income Tax Act.d. Exemption from dividend distribution tax under Section 115O of the Income Tax Act.e. Exemption from Central Sales Tax (CST)f. Exemption from Service Tax100% FDI investment is permitted through Automatic Route. The suitablelocation is Noida, Uttar Pradesh in North India.Minimum investment in plant and machinery and building is Rs 100 lakhs(INR) for EOU. This should be before commencement of commercialproduction. In case of SEZ, there is no minimum requirement in terms ofinvestment. The minimum capital requirements of forming a Private LimitedCompany are Rs. 1 Lakh (INR). In addition to this, the other costs willdepend upon number of factors such as size of the business, location, landcost, etc.As far as applying for PAN card is concerned, NRI can apply for PAN inIndia by submitting certain documents to Income Tax Department For more info on Business setup visit www.startbizindia.in Page |8 For Business setup queries email at neha@indiacp.com or call at 011 40622239
    • Upcoming Business Summit National Positioning Bengal Partnering for Growth, Development and Sustainable Security • Positioning Bengal Partnering for Growth, The tremendous growth potential of West Bengal has drawn ASSOCHAM’s Development and Sustainable Security attention towards it and has given us a sturdy reason to come up with this Seminar. The prime objective of the seminar is to review current policies of the State Government for promoting investment in diversified sectors, besides exploring new investment opportunities in various booming sectors of the State. th Date: 22 August, 2012 Venue: Hotel ITC Sonar, Kolkata Social Entrepreneurship: Sustaining Business for Society Indian School of Business is organising Social Entrepreneurship: Sustaining Business for Society programme. In this programme, cases of social ventures at different stages of development will be studied. th th Date: 27 August 2012 to 29 August 2012 Venue: Indian School of Business, Gachibowli, Hyderabad • Social Entrepreneurship: SME ICT SUMMIT Sustaining Business for The Summit aims to equip SMEs with the tools, resources and information Society they need for business readiness and staying ahead of market trends with the use of different ICT solutions.The Summit will bring together the distinguished speakers from information technology sector to exchange latest information on various IT solutions available for SMEs, various IT • SME ICT SUMMIT strategies SMEs can use in order to enhance their growth, challenges faced by SMEs for IT implementation. th Date: 7 September 2012 Venue: Hotel Sofitel BKC, Mumbai For more info on Business setup visit www.startbizindia.in Page |9 For Business setup queries email at neha@indiacp.com or call at 011 40622239
    • Contact Us Neha Seth Visit us at E: neha@indiacp.com D: +91.11.40622239 A Venture of Shipra Paul D- 38, Ist Floor, South Extn. Part I New Delhi – E: shipra@indiacp.com 110049 T: 40622200 F: 91.40622201 D: +91.11.40622246 E: info@startbizindia.comDisclaimer:This paper is a copyright of Corporate Professionals (India) Private Limited. The entire content of this paper havebeen developed for the new startups. The author and the Company expressly disclaim all and any liability to anyperson who has read this paper, or otherwise, in respect of anything, and of consequences of anything done, oromitted to be done by any such person in reliance upon the contents of this paper. For more info on Business setup visit www.startbizindia.in P a g e | 10 For Business setup queries email at neha@indiacp.com or call at 011 40622239