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FICCI Business Digest - January 2013
 

FICCI Business Digest - January 2013

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The need for re-energising the electricity sector is therefore urgent. This can be achieved through a series of steps such as commitment to buy, an acceptable fuel price, operation of stranded ...

The need for re-energising the electricity sector is therefore urgent. This can be achieved through a series of steps such as commitment to buy, an acceptable fuel price, operation of stranded capacity, commercial orientation of utilities, domestic fuel availability, creation of an integrated national grid with enhancement of inter-regional transmission capacity and promotion of competitive markets in all elements of the chain. Among other things, the cover story in January 2013 issue of our Business Digest throws light on some of these critical aspects of reform in the Indian electricity sector.

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    FICCI Business Digest - January 2013 FICCI Business Digest - January 2013 Document Transcript

    • BUSINESS DIGEST VOL. NO. 9 ISSUE NO. 10 January 2013 Re-energising the Electricity Sector Celebrating the spirit of Pravasi Bharatiyas
    • OracleSurrounds SAP Oracle Hyperion EPM Oracle Oracle Oracle SAP Siebel PeopleSoft Industry ERP CRM HCM Specific Oracle Middleware Oracle Database96% of SAP Customers Run Oracle Applications* email salesinquiry_in@oracle.com or call 000 800 100 7789 / 080 4029 1298 * Based on SAP customers listed in Fortune Global 100 Copyright © 2012 Oracle and/or its affiliates. All rights reserved. Oracle and Java are registered trademarks of Oracle and/or its affiliates. Other names may be trademarks of their respective owners.
    • Inside… 6 Cover Story BUSINESS DIGEST VOL. NO. 9 ISSUE NO. 10 January 2013 » Restructuring of Coal India Ltd. on the cards » Power transmission line planning Re-energising theChairman Electricity Sector and capacity building up againstDr. A Didar Singh manifold challenges » 32% of industrial units across IndiaEditor face power shortage of over 10Sukumar Sah hours a week » Sam Pitroda launches ‘India Smart Celebrating the spirit of Pravasi BharatiyasAssistant Editor Grid Knowledge Portal’Sushmita YadavMarketing 4 Secretary General’s MessageAnimesh GoswamiAdvertising & Circulation 10 India woos Overseas Indians to a land of opportunitiesVeena SrivastavaPL Joseph 14 Multi-pronged steps to boost Technical Textiles in the offingRahul Siwach 16 Youthful population, urbanisation will drive tourism growth:Design & Art Amitabh Kantwww.seemasethidesign.com© All Rights are reserved. 18 Leveraging international expertise for a skilled IndiaNo part of this publication may bereproduced, stored in a retrieval 22 States must come on board for development of highwayssystem, or transmitted in any form orby any means, Electronic, Mechanical, 24 Proactive disclosure on water use by industry is vitalPhotocopying, Recording and/orotherwise without the prior writtenpermission of the Publisher. 26 FICCI celebrates National Consumer WeekStatement about Ownership and other 28 CSR in Companies Bill 2012Particulars about the Journal (FICCIBusiness Digest) required to be 30 12th Businessworld-FICCI CSR Awardpublished under Rule 8 of theRegistrar Central Rules, 1956. 32 Re-living the Indian narrativePrinted and Published by SecretaryGeneral on behalf of (or owned by) 33 Meeting with Regional ChambersFederation of Indian Chambers ofCommerce and Industry, New Delhi 34 New and updated services being offered by FICCIand Published at Federation HouseTansen Marg, New Delhi - 110001 36 In the StatesR.N.I No. DELENG/2004/13722Federation of Indian Chambers 40 Macro Economic Indicatorsof Commerce and Industry,Federation House, Tansen Marg,New Delhi - 110001 WE Look Forward to Your FeedbackPhone: 23738760-70 (11 Lines)Fax: 23320714, 23721504 We would like your feedback/comments to enable us toE-Mail: ficci@ficci.com improve our offering. Write to us at: sukumar.sah@ficci.com orWebsite: www.ficci.com sushmita.yadav@ficci.com
    • Secretary General’s MessageDear Readers,The challenges of revamping India’s electricity sector are legion. From poor financial health of utilities, inadequate fuelsupply, decline in gas production, inadequate increase in coal supply to stranded assets on account of fuel shortage and ahuge deficit in the southern region leading to power holidays in some states, the list is endless. The need for re-energisingthe electricity sector is therefore urgent. This can be achieved through a series of steps such as commitment to buy, anacceptable fuel price, operation of stranded capacity, commercial orientation of utilities, domestic fuel availability, creationof an integrated national grid with enhancement of inter-regional transmission capacity and promotion of competitivemarkets in all elements of the chain. The cover story in this issue throws light on some of these critical aspects of reform.The 11th Pravasi Bharatiya Divas (PBD) was organized this year in Kochi, Kerala, by The Ministry of Overseas IndianAffairs in partnership with the Government of Kerala. FICCI was proud to be the event manager for the three-dayconvention. Over the years, PBD conventions have given a voice to the Indian Diaspora in matters relating to knowledge,trade and investment, and social engagement. The dialogue has been translated into many concrete actions. This year’sPBD heard clarion calls by the President and the Prime Minister of India to the Pravasi Bharatiyas to engage purposefullyand profitably in India’s growth story. We bring to you a snapshot of the mega event.There is no gainsaying that faster and hassle-free inter-state movement of people and goods is a sine qua non for maximizingthe welfare quotient of a society. The challenge of building and upgrading the highway network in India is huge. The moniesrequired for highway projects are enormous as are the problems in implementation. The NHAI Chairman addressedindustry leaders at a conference at Federation House where he enlisted the support of the State Governments for successfulimplementation of highway PPP projects by signing State Support Agreement. This issue carries a brief report on theconference.I am happy to state that Aero India 2013, Asia’s premier air show is being organized jointly by the Ministry of Defenceand FICCI at Bengaluru from February 6-10, 2013. We will share with you the highlights of the air show in the next issue.I look forward to your views and comments on our offering.4 || FICCI Business Digest || January 2013
    • COVER STORY Bid to Re-energise the Electricity Sector Restructuring of Coal India Ltd. on the cards W ith a view to infusing route. A few more blocks for offer to B K Chaturvedi, Member, Planning competition in the coal private sector are in the pipeline.” Commission, Government of sector and to review the He said that to adopt international India,  said that  the issues faced by existing institutional mechanism, best practices on trading of thermal the power sector related to capacity the Government proposes to restru- coals and for ensuring consistency creation, problem of availability of cture Coal India Limited for which in quality of coal supplies, the fuel, pressures faced at the time of expression of interest has been Government has introduced GCV land acquisition for mining, power floated by the Ministry for identifying based grading and pricing of losses of 16-17 per cent and dismal suitable consultants, said  Sriprakash thermal coals in place of the earlier performance of private sector in coal Jaiswal, Union Minister of Coal, system of UHV. Emphasis is laid on production. Government of India, while inaugu- strengthening the infrastructure for He said that if the gas prices made rating the 7th edition of ‘India crushing, sizing and processing of remunerative, the Southern region Electricity 2013’, organised by FICCI coal besides strengthening sampling is integrated with the national grid and Ministry of Power, Government infrastructure in coal fields. and new LNG capacities are created, of India, in New Delhi on January “Our efforts to acquire coal many major hurdles of the electricity 16, 2013. equity abroad have thus far resulted sector can be crossed. He further The theme of the three-day inter- in acquiring two coal blocks in suggested that now that the tariffs national exhibition and conference Mozambique by state-owned CIL have been revised in all the states was ‘Re-energising Indian Electricity while the private companies have of India except Assam, periodical Sector’. been successful in acquiring the assets revision of tariffs must be undertaken Jaiswal said, “For increased transp- in countries like Indonesia, Australia, as and when the prices of the raw arency in coal block allocation the South Africa and South America. We materials get escalated. provisions of MMDR Act have been need to be aggressive in this regard P Uma Shankar, Secretary, amended and new set of rules have from long term energy security point Ministry of Power, Government of been framed for allocating new of view,” he pointed out. India,  said that this year  the focus blocks through competitive bidding. A knowledge paper ‘Re-energising was on Chhattisgarh and how best Recently, 14 blocks for power and Indian Electricity Sector’ prepared the state’s assets can be utilised. The three for mining have been put on by FICCI and ICF International was issues of distribution reforms, role offer under government dispensation released on the occasion. of regulators, enhancing viability of L to R: R S Sharma, Managing Director, Jindal Power Limited and Chairman, FICCI Power Committee; P Uma Shankar, Secretary, Ministry of Power; Sriprakash Jaiswal, Union Minister of Coal; Naina Lal Kidwai, President, FICCI; Dr A Didar Singh, Secretary General, FICCI and Nitin Zamre, Managing Director, ICF International, India. 6 || FICCI Business Digest || January 2013
    • COVER STORYdistribution companies, availability United States, the second largest gas production, inadequate increaseof domestic fuel, fuel pricing & producer of coal. Coal production in coal supply; stranded assetscontract management, project of Coal India Limited (CIL) had on account of fuel shortage; hugefinancing, transmission line planning stagnated in previous two fiscal deficit in Southern region leading toand capacity building, peaking power years FY12 and FY11 at 434 million power holidays in some states andand system reserve, power markets tonnes. In the face of rising demand low despatch of W3 (Chhattisgarh)and demand side management needs for coal demand, this was clearly plants on account of transmissionto be deliberated upon to enhance unacceptable. Though to a certain bottleneck.the power sector. Also, renewables degree this deficit can be bridged by He suggested both short-term andare becoming an important source coal imports, the average premium long term key measures that should beof power generation, therefore, of imported coal incurs an additional adopted to re-energise the sector suchintegration of it needs to be planned. cost anywhere between 30-50 per cent as commitment to buy, acceptable It should be noted that coal is the of domestic coal, resulting in steep fuel price, operate stranded capacity,mainstay of India’s energy and will hike of input costs. India imported commercial orientation of utilities,continue for some time in future. 103 million tonnes of coal in FY12, domestic fuel availability, integratedAbout 55 per cent of primary energy resulting in a foreign exchange outgo national grid with enhancement ofsupply and about 70 per cent of power of Rs 78,840 crore. inter-regional transmission capacitygeneration in the country is coal based. She said, “Ministry of Coal must and promoting competitive marketsThis is on account of availability of explore gradual disinvestment of in all elements of the chain.coal reserves in abundance and lower CIL and hiving off its subsidiaries R S Sharma, Managing Director,price of the fuel compared to other as independent entities which can Jindal Power Limited and Chairman,fuel resources. At the current level of compete in an open market. In the FICCI Power Committee,  remarkedcoal production of about 540 million long run, it will be necessary to amend that coal auction for PSUs and privatetonnes, the country’s coal reserves the Coal Mines (Nationalisation) Act sector will help in stepping up theare likely to last for over 100 years. 1973, to allow for private participation coal production in the country. AtHowever, efforts were being made in coal mining and production.” present, inadequate fuel supply isto enhance exploration for enlarging Nitin Zamre, Managing Director, proving to be a major hindrance.resource based. ICF International, India, highlighted Once productivity is enhanced Naina Lal Kidwai, President, the  challenges faced by the power and restructuring of Coal India isFICCI,  stated that according to a sector in India. Some of them were undertaken, the sector is bound toFICCI study Indian coal mining poor financial health of utilities; narrow the gap between the demandproductivity is one-tenth that of the inadequate fuel supply; decline in and supply of electricity in India.Power transmission line planning and capacity buildingup against manifold challengesP ower transmission line planning and capacity building are beinghampered because of issues such “The rationale for planning the transmission corridor is being worked out. Also, it was seen that STUs and infrastructure project corresponding to load growth and area of generation; coal reserves and their location andas fuel linkages for thermal plants, DISCOMS face the problem of lack likely generation of capacity additionavailability and acquisition of land, of communication, which needs to be scenarios.and environmental and forest resolved,” he added.  Vikas Saksena, Executive Viceclearances, Ravinder, Member – A K Gupta, Executive Director – President, Jindal Power Limited,Power Systems, Central Electricity Engineering, NTPC Limited, pointed remarked that there was a needAuthority, told the delegates at the out that there was a huge mismatch for closer cooperation between theIndia Electricity 2013. between generation and transmission STUs and the other stakeholders. Ravinder said that the transmission project schedules. This gap must be He highlighted the fact that it waslines are non-polluting and noise- narrowed down and linkages and very difficult to give specific drawalfree, but still we have to face prolonged common meeting points need to be points, instead, target regions can bedelays in environmental and forests reached to avoid undue delays. identified. The generation areas andclearances. He said narrow-base He also suggested that transmission load points are known, hence, thesetowers and cylindrical towers are development should be independent should take care of transmissionbeing thought of as options, which of generation projects and should planning.will reduce the footprint of a tower. be developed like any other January 2013 || FICCI Business Digest || 7
    • COVER STORY 32% of industrial units across India face power shortage of over 10 hours a week FICCI-BRIEF Survey: Two-thirds of Indian firms losing competitive edge due to shortages and erratic power supply A s many as 61 per cent of the firms suffer above 10 per cent shortfall in production due to power cuts, 13 per cent suffer 2-5 per cent shortfall in production, 12 per The survey notes that firms are facing cost escalation, losses in revenue, increased consumption of fuel, increased investment in captive facilities, higher inventory cent suffer 6-10 per cent and only 14 per cent, mainly in costs and loss in competitiveness and many other issues Gujarat, Karnataka and Maharashtra, suffer less than 2 that are seriously detrimental to the health and stability per cent production losses, assuming that the firms do of the Indian industry. not rely on power back up units to ensure continuous Almost two-thirds of the firms in the Indian industry production activity. This finding is revealed in a Survey feel that because of the power shortage and intermittent by the Federation of Indian Chambers of Commerce and supply, they are losing to their international competitors Industry (FICCI) and Bureau of Research on Industry and and thus losing their previously captured international Economic Fundamentals (BRIEF), ‘Lack Of Affordable markets. Not only does this limit future expansion as and Quality Power: Shackling India’s Growth Story’. companies remain wary of not being able to compete, the The survey conducted over the last three months Indian economy which depends highly on firms trading in covering 650 large, medium and small industries in 20 the international markets is affected as well. states across India. Of the 650 companies interviewed, 67 The results show that approximately 37 per cent of per cent were privately owned and 28 per cent were either firms, mainly in Gujarat, Maharashtra and Karnataka face private partnership or individual ownerships. Only 3 per less than 1 hour of power shortage in a week and at the cent of the total sample was public sector or government same time 5 per cent suffer 21-30 hours per week and 21 run units and 2 per cent were from the multinational per cent suffer more than 30 hours per week (primarily corporation category. in Tamil Nadu and Andhra Pradesh). Further, it was also The survey reveals that companies in Gujarat incur low found that 16 per cent face 6-10 hours per week, while 15 losses as power shortages in the state are negligible. per cent face between 1-5 hours weekly. This makes it Companies in Karnataka are in the IT-enabled services evident that no segment of the industry pan-India is safe sector which is not as power intensive as Iron and Steel, from negative impact due to power losses and power Aluminium etc. and hence suffer less production shortfall outages. Overall, 32 per cent of industrial units across as compared to the electricity intensive sectors. It was India face power shortage of over 10 hours a week. observed from the survey, that Maharashtra, which as a The survey notes that 54 per cent of companies were mix of both IT and manufacturing companies, like Gujarat, aware in advance of the load-shedding schedule. While does not suffer as acutely by power shortages as some more than half of the companies are aware and the of the other states around the country. Based on these information is available, the awareness of load-shedding and other findings, the survey recommends the following should be far more widespread. Within the 46 per cent, 10-point policy package to provide affordable and quality the majority of companies that did not know the schedule to industrial consumers: were from particular states. This implies that the information though available is not as uniformly available • Increase capacity of installed sources as it should be and that stakeholders in certain states • Ensuring communication to load dispatch centre and are hence unprepared for power cuts, increasing the an extensive review and audit of the protection systems negative impact of power outages on their operations. • Implementation of smart grid A centralised information channel must be set up, • Grant of open access option to the consumers, which such that the entire Indian industry, not just companies will allow all the bulk consumers to choose their in a few states have the knowledge and information of distributors must be operationalised schedules on planned power cuts or load-shedding. • Use of alternate sources of power generation must be The revenue losses due to power cut range between encouraged less than Rs 1000 to above Rs 40000. Even small and • Incentivise ‘green’ architecture or building such that medium firms incur losses above Rs 40000, mainly in conventional energy usage can be minimised to its the poorer performing states. In states like Gujarat, lowest possible amount Karnataka and Maharashtra, the majority lose less than • Awareness and education programmes on green Rs 1000 implying that if the power scenario in the other technology states is made to mimic the scenarios in these three • Create industrial cooperatives that can source elect- states, revenue losses can be brought down to as low as ricity or have a dedicated captive generation source Rs 1000. As per survey findings, 57 per cent of the firms • Provide clear and public information on power cuts are of the view that cost of electricity will increase in the • Stricter laws and penalties for the theft and next six months, while 43 per cent believe that it will unsanctioned use of electricity remain the same. • In-depth study on the normal requirements of different sectors in the country 8 || FICCI Business Digest || January 2013
    • COVER STORYSam Pitroda launches‘India Smart Grid Knowledge Portal’W hile many steps have been initiated in the area of SmartGrids in the country, the concept and He pointed out, “If in the coming three months, we are able to work out a meter design and get the eight trials FICCI partnered with the ISGF to organiseits applications are still at a nascent under way, it will be a big success for the India Smart Gridstage. There was a need to focus on Smart Grid in India as these trialsthe challenges faced by India and will help us in deciding how best Day as part of the Indialook at ways to reduce leakages, India can benefit from it.” Pitroda Electricity event. On theconsolidation of micro-grids, find also mentioned that he has requestedlow-cost solutions and encourage the Deputy Chairman of Planning occasion, Sam Pitrodaindigenous discussions, said Sam Commission to release more funds launched the ‘IndiaPitroda, Adviser to Prime Minister of to move the agenda of Smart GridIndia, Chairman, National Knowledge forward. Smart Grid KnowledgeCommission and Chairman, India Reji Kumar, President, India Portal’.Smart Grid Task Force (ISGTF), while Smart Grid Forum, said that theaddressing a Special Session at ‘India development of Smart Grid in theSmart Grid Day’ in New Delhi on country has gained some prominence.January 17, 2013. Pitroda and the concerned authorities FICCI partnered with the ISGF to are working on how best Smart Gridorganise the India Smart Grid Day as can be used in the Indian context.part of the India Electricity event. On Dr. Arbind Prasad, Secretarythe occasion, Pitroda launched the General, FICCI, while welcoming‘India Smart Grid Knowledge Portal’, Pitroda, said that for developedwhich was among one of the initi- countries Smart Grid is a means toatives that were discussed a year ago. move towards a low carbon economy.The portal (www.indiasmartgrid.org) For a developing nation like India,was developed by Ministry of Power Smart Grid necessarily is a way to(MoP), ISGTF and India Smart Grid reduce power losses and improvingForum (ISGF). quality of power supply. The urgency for Smart Gridsin India emerges from the keychallenges that the industry iscurrently facing. India operatesthe third largest transmission anddistribution network in the world,yet faces a number of challenges suchas inadequate access to electricity,supply shortfalls (peak and energy),huge network losses, poor qualityand reliability and rampant, theft. Theevolution towards Smart Grid wouldaddress these issues and transformthe existing grid into a more efficient,reliable, safe and less constrainedgrid that would help provide accessto electricity to all. “We have been able to set up a TaskForce and Forum, dedicated to SmartGrid and have collectively decidedto initiate eight trials but not muchaction has taken place in this regard,”said Pitroda. He admitted that so farthe Smart Grid agenda has not been Sam Pitroda, Chairman, National Knowledge Commission and Chairman, India Smart Griddriven successfully. Task Force, addressing a Special Session at ‘India Smart Grid’. January 2013 || FICCI Business Digest || 9
    • Celebrating the spirt of Pravasi Bharatiyas “I wish to see the Indian Diaspora The President of India, Pranab Mukherjee (5th from left) welcoming the Overseas Indians to the as a stronger partner, not only Pravasi Bharatiya Divas on January 9, 2012, in Kochi, Kerala. in India’s economic growth, but also in building India’s knowledge society, while continuing to engage India woos Overseas Indians culturally and emotionally, and serving as the effective ambassadors to a land of opportunities that they have been for this country. With the knowledge and experience T you have gained as academics, he 11th Pravasi Bharatiya India, he said, was a land of immense scholars, scientists, technologists, Divas (PBD) was organised in opportunity; the second fastest growing professionals and businessmen, Kochi, Kerala, from January economy after China. But for a brief you can play a decisive role in the 7-9, 2013, by The Ministry of Overseas period of economic deceleration, six development of India. I have no Indian Affairs in partnership with of the nine years that have gone by doubt that together we will keep our the Government of Kerala. PBD witnessed a GDP growth of around 8 ‘tryst with destiny’. conventions provide a platform to the per cent. Non-Resident Indians to engage with The Prime Minister of India, Dr. While we celebrate the accom- the government and people of the Manmohan Singh, who inaugurated plishments of the Diaspora, we land of their ancestors for mutually the convention, on his part, declared should also not forget that many beneficial activities. These conventions the Government’s unequivocal comm- of them are struggling to establish also assist them to network with the itment to deepen the connection of themselves and many are facing Indian community residing in various expatriate Indians with their country hardships. Some of them are parts of the world and enable them to of origin and advance their interests. working as labourers and domestic share their experiences in various fields. “While honouring their achievements, helps. Many of them face difficulties Pravasi Bharatiya Divas has been we will also seek to facilitate their travel, on account of stringent labour successful in giving voice to the business and education and make laws, difficult working conditions, Indian Diaspora in matters relating to it easier for them to be a part of life non-receipt of salaries, premature knowledge, trade and investment, and of India, enjoy due rights and partic- termination of contracts, change of contractual obligations amongst social engagement. The dialogue it ipate in India’s economic development,” others.” has fostered in the past has now been he said. translated into many concrete actions. He invited the overseas Indian com- Pranab Mukherjee, This year’s convention too carried munity to be a strong and vital partner President of India forward the agenda set by the previous and participant in India’s social and editions in deepening the relationship economic development. “Whether you India has with its Pravasis. wish to invest or share your knowledge, On the occasion, the Prime Minister Addressing the convention, Pranab technology and skills, whether your released a stamp on ‘Gadar Movement’ Mukherjee, President of India, expre- enterprise takes you to the cities or your and two publications, namely, ‘India ssed his confidence that the Indian compassion brings you to a remote Supports’ and ‘Handbook for Emigrants’. economy would bounce back to a village, I assure you of our continuing He said that the protection and 8-9 per cent GDP growth due to its effort to support your endeavours,” promotion of the rights and interests strong economic fundamentals and the Dr. Singh said. of Indian businesses, professionals and reforms driven policy initiatives of the “Apart from physical safety, we are workers abroad is also a key task for our Government. “To achieve this order of also concerned with the social and Missions in various countries. India’s growth over a sustained period of time emotional well-being of our overseas Comprehensive Economic Partnership would need large doses of investment. brethren. We have therefore launched Agreements and Social Security Agree- The overseas Indians could help by an insurance scheme for workers, esta- ments with a number of countries play investing in Indian companies and blished welfare funds in our embassies an important role in this regard. in the capital market as the yield of for distressed Indians, and created Rajkeswur Purryag, President of the equity markets in India was much mechanisms to help vulnerable women Mauritius, the Chief Guest, said, “We higher than elsewhere,” he said. abroad,” he pointed out. take pride in the rise of India... we share 10 || FICCI Business Digest || January 2013
    • “Post-independence, overseas Indi- ans have served as a bridge of friendship and cooperation between India and their adopted homes abr- oad. Regardless of whether they are successful professionals, traders and The Prime Minister of India, Dr. Manmohan Singh at the inaugural session of entrepreneurs, or second generation Pravasi Bharatiya Divas. Indians, comfortably reconciling their two identities, or workers toiling hard to build a future for amended to keep in step with the needs Ten states of India showcased the their families, they are at all times a all concerned. “We have worked on a law multifarious investment opportunities most effective window for the world in this regard and we hope to finalise it for the Indian Diaspora with a view to to India’s heritage and its progress. soon.” He announced that the merger of identifying areas for forging partne- the OCI and PIO cards would soon be rships with overseas Indians. The We in the Government will do done to create a single OCI card. states were Kerala, Punjab, Rajasthan, all that is possible to deepen their Oomen Chandy, Chief Minister of Gujarat, Odisha, Bihar, Jharkhand, connection with India and advance Kerala, in his address, pointed out that Andhra Pradesh, Maharashtra and their interests. While honouring he expected the Planning Commission, Madhya Pradesh. their achievements, we will also seek Government of India, to respond to facilitate their travel, business positively to his suggestion to formulate and education and make it easier a Centrally-sponsored scheme to for them to be a part of life in India, supplement the efforts of the State enjoy due rights and participate in Government in the rehabilitation of India’s economic development. returning migrants. I believe that the overseas Indian Some of the major concerns still community should be a vital being faced by Indian expatriates in partner and participant in India’s their host countries, especially in the social and economic development. Gulf, related to issues of job security, Whether you wish to invest or share reasonable living conditions and legal your knowledge, technology and protection for the unskilled and semi- skills, whether your enterprise takes skilled workers. These, Chandy said, you to the cities or your compassion needed to be addressed by the Union “The theme of this Convention, brings you to a remote village, I Government. ‘Engaging Diaspora: The Indian assure you of our continuing effort Amongst other, the PBD convention Growth Story’, is very fitting and to support your endeavours.” was addressed by K C Joseph, Minister appropriate on many counts. for NORKA and Culture, Government of The theme reflects the increasing Dr Manmohan Singh, recognition of the importance and Kerala; Kamal Nath, Union Minister for Prime Minister of India relevance of the Diaspora’s potential Urban Development and Parliamentary Affairs; Anand Sharma, Union Minister contribution to the sustainedcommon values, a common heritage of Commerce and Industry; Montek growth of India.and we are grateful to India for its Singh Ahluwalia, Deputy Chairmanselfless support to Mauritius in its social of the Planning Commission; Salman Mauritius and India, the land of our ancestors have always sharedand economic development process.” Khurshid, Union Minister for External very close and special ties based on The Indian Diaspora, he said, needed Affairs; Ajay Maken, Union Minister historical foundations and commonto capitalise on India’s growth story and for Housing and Poverty Alleviation; E values. We, in Mauritius, highlyseek active partnerships with Indian Ahamed, Union Minister for State for value the selfless support of India forcompanies is areas such as science & External Affairs; Dr. Shashi Tharoor, our continued economic progress.”technology, education and other hard Union Minister of State for Humanand soft infrastructure sectors. Resources Development; Sam Pitroda, Rajkeswur Purryag, Vayalar Ravi, Union Minister for Adviser to PM on Public Information, President of the Republic ofOverseas Indian Affairs, announced Infrastructure and Innovation and Mauritiusthat the emigration system was being Naina Lal Kidwai, President, FICCI. January 2013 || FICCI Business Digest || 11
    • Celebrating the spirt of Pravasi Bharatiyas “The Kerala Government has established an investment promotion council and promotion board for fast- tracking the investment “India is facing challenges in proposals. I wish to offer infrastructure development, all help to all NRIs who are especially in urban sector. “I am deeply aware of the willing to invest in the various Today, around 430 million problems faced by Malayalis in developmental projects. people are residing in cities and the Gulf and I assure you that in the next decade, the number I will take up your suggestions In order to deal with serious will increase to 600 million. with the Prime Minister and travel issues from Gulf, State Similarly, at present, there are my Cabinet colleagues for their has taken steps to constitute a 53 cities in India, and it will expeditious redressal. Company called ‘Air Kerala’ to rise to 72 in the next decades, operate budget airline services each having a population of My Ministry has set up the from Gulf to Kerala. Steps are one million.” Indian Community Welfare on to implement the project with Fund (ICWF) which now the participation of all the Non Kamal Nath, covers all the missions abroad. Resident Keralites of the State.” Union Minister for We are using ICWF funds to Urban Development and assist Indians who are leaving Oommen Chandy, Parliamentary Affairs UAE under the amnesty scheme Chief Minister of Kerala announced by the Government of UAE recently; we supported the building of cremation and burial ground for Indians at Sharjah; the building of a multi-purpose centre and crematorium at Ajman, UAE; and the building of the Indian social centre at Umm Al Quwain, also in the UAE. In short, the Indian Community Welfare Fund is being effectively used for the welfare “India invites contributions of the Indian communities from the younger generation “Indian economy is growing abroad.” of the NRIs. The government despite the economic crisis that engulfed the world. The is making plans to attract the Vayalar Ravi, Union Minister youth among the Diaspora in country’s GDP will grow in for Overseas Indian Affairs this regard. The future Pravasi the coming years, generating new job opportunities. The Bharatiya Divas conclaves FDI policy is made more will also need to include youth rational and friendly. The under 35 years of age so that national investment rate is their participation is ensured.” around 33-34%, and by the end of 12th Plan the aim is to Salman Khurshid, Union increase to 36%.” Minister for External Affairs Anand Sharma, Union Minister of Commerce and Industry 12 || FICCI Business Digest || January 2013
    • “Getting back to a robust growth “The Government of Kerala willmode is going to be a major chart out measures to extendaspect of the 12th Plan that voting rights to the non-residenthas just started. During the “Rapid urbanization has Keralites for participationnext four years, we can’t have increased in the country, and the electoral processes of thea robust export growth, but this situation calls for better Panchayat and local bodies too.we can have robust economic infrastructure development. The This plan will be moved whengrowth. India is under-invested Non-Resident Indian youth can the next session of the Keralain. Once the signal is clear lend their skills and expertise so Assembly happens.”that the government is open to as to get more involved in theinvestment, it won’t be tough for infrastructure development of K C Joseph,growth.” the country.” Minister for NORKA and Culture, Government of KeralaMontek Singh Ahluwalia, Ajay Maken,Deputy Chairman of the Union Minister for Housing andPlanning Commission Poverty Alleviation “India needs to create durable products and not disposable ones. The country requires its own set of innovative ideas because“The decline in the percentage “Wherever an Indian goes, we cannot adapt the Westernof Malayali workforce in the he takes a bit for India with set-up as the environment differsGulf region now calls for steps him. In times of distress and completely. Also, the focus shouldto extend facilities for the uprisings, India’s heritage be on the people who are at thedevelopment of skills to those represented by the Diaspora bottom of the pyramid and wewho are looking to go to the Gulf has to reiterate tolerance as an need to increase their earningscountries in search of jobs.” example to the world.” and employment opportunities.”E Ahamed, Dr. Shashi Tharoor, Sam Pitroda, Union Minister for State for Union Minister of State for Advisor to PM onExternal Affairs Human Resources Development Public Information, Infrastructure and Innovation “We hope to involve our Diaspora youth to the new opportunities in our part of the world. By tapping into the experiences and energy of young overseas Indians we can certainly achieve the benefits of ‘brain gain’. We are proud of the achievements of our engineering graduates from IITs who have been contributing to global research. I urge the Diaspora youth to connect with our Universities and explore new synergies for pushing the knowledge frontier. FICCI works closely with educational institutes and innovators and we would be happy to facilitate your endeavors across different verticals.” Naina Lal Kidwai, President, FICCI January 2013 || FICCI Business Digest || 13
    • T he Government is adopting a Technical textile is an important multi-pronged approach for part of the textile industry and its growth of the technical textiles potential is still largely untapped. sector in the 12th Plan. The approach Unlike the traditional textiles sector, aims to intensify implementation of which witnessed slowdown in the Technology Mission on Technical last few years, technical textiles has Textiles; providing regulatory reportedly experienced a robust framework in specified areas for the growth. It is expected that technical growth of technical textiles; a special textiles market in India will grow focus on usage of technical textiles in from the current size of around $11 the northeast region of the country. billion to $29 billion in the next While inaugurating Technotex five years. The accelerated growth 2013 in New Delhi on January 17, of Indian economy would also 2013, under the theme, ‘Building favourably impact the growth of the International Linkages for Sustainable technical textiles. It is estimated that Growth’, Anand Sharma, Union the overall growth in technical textile Minister for Commerce and Industry industry will be about 20 per cent in & Textiles, said that Rs 55 crore has the next five years. been allocated for the development The Government would also of technical textiles in the northeast. be setting-up ‘revolving fund’ for He announced that in the ensuing providing assistance to entrepreneursL to R: Naina Lal Kidwai, President, Budget the allocation for technical for R&D in the area of technicalFICCI; Anand Sharma, Union Minister textiles is expected to be raised by textiles and another revolving fundfor Commerce and Industry & Textiles five times. The Government was also would be set up to provide loansand Kiran Dhingra, Secretary, Ministry ofTextiles, Government of India, releasing working on a loan waiver package for on soft terms and conditions. Thethe ‘Investors’ Guide-Driving Growth of the handloom sector especially for assistance from the revolving fundTechnical Textiles in India.’ weavers and artisans. will be limited to maximum 90 Multi-pronged steps to boost Technical Textiles in the offing14 || FICCI Business Digest || January 2013
    • per cent of the estimated approved to be for the next 10 to 15 years atproject cost and the promoter has to least which will provide stable fiscalcontribute minimum 10 per cent of and non-fiscal regime for the sector.the estimated approved project cost. FICCI would be happy to assistThe interest on loan shall be not more Ministry of Textiles for formulatingthan five per cent per annum (simple this roadmap.interest). The loan assistance would Secondly, technical textiles find The Governmentnormally be not more than Rs 100 applications in different sectors which would be setting-uplakh for each project. The repaymentof loan, together with interest shall fall under various Departments of Government. Without the involve- ‘revolving fund’ forcommence within one year after ment of these departments the sector providing assistance tothe project completion and shall be cannot register its targeted growth. It entrepreneurs for R&Drepaid in five years. is important that regulatory regime The Government is also in the and schemes falling under various in the area of technicalprocess of supporting the setting departments ensure a stable and textiles and anotherup of technical textiles parks in the predictable market demand for thesecountry under the SITP scheme. products in the next 10 to 15 years. revolving fund wouldAlready, there is Pallavada in Tamil This is a technology intensive industry be set up to provideNadu, Baramati HiTech Textile Park and requires relatively substantialin Maharashtra; Technical Textiles investment as compared to traditional loans on soft terms andand Machinery Mega Project in textiles. Hence, it is important that conditions.Bellary, Karnataka and others for they have a clear market developmenttechnical textiles manufacturers. roadmap for a longer period. She Exports of technical textile products suggested constitution of a Committeecurrently stand at 16 per cent and of Secretaries which can resolvethere was potential to do better. these interdepartmental issues on aSharma said the sector accounts for regular basis.four per cent of GDP and 17 per cent Thirdly, formulating standards forto industrial production. these products will infuse confidence Director, Ginni Filaments; Ashok On the occasion, the Minister in the consumers. There are number of Gupta, Executive Director andreleased an ‘Investors’ Guide-Driving technical textiles products for which CEO, Indo Rama Synthetics (I) Ltd;Growth of Technical Textiles in India’ standards need to be formulated. This Justin Huang, Secretary General,and also launched the website and may require capacity building at the Taiwan Textile Federation; MohanCDs on Compendium on COEs. standard setting bodies also in order Kavrie, Managing Director, Supreme Kiran Dhingra, Secretary, Ministry to ensure speedy formulation of these Nonwoven Industries Pvt Ltd; Sushilof Textiles, said that the technical standards. Kapoor, President & CEO, SRF Ltd;textiles sector is expected to reach Fourthly, technical textiles draw a Dr. Andreas Schmidt, Director,a turnover of $30 billion by 12th lot of raw material from synthetic or Hohenstein Institutes, Germany;Plan end, an annual growth of 20 manmade fibres. In order to ensure Sarojit Malik, Founding Managingper cent. She said Rs 200 crore has competitive downstream industry it Director, Access Internationalbeen earmarked for the Technology is important to achieve a fibre neutral Capital, USA; Mary Lynn Landgraf,Mission, which will help in creating tax regime at the earliest. Senior International Trade Specialist,infrastructure for R&D. Shishir Jaipuria, Chairman, FICCI Office of Textiles & Apparel, Further, an integrated skill develo- Committee on Textiles and Technical US Department of Commerce;pment scheme for textiles has been Textiles, pointed out that the market Vivek Kohli, Vice Chairman, Staglaunched under which several for this sector is likely to attain a size International; Vayu Garware,stakeholders have initiated efforts to of $29 billion in next five years. This Managing Director, Garware Wallpromote development and training only indicates that this sector has Ropes; Gautam Chakravarti, CEO,of personnel for technical textiles. potential to be a sunrise sector of Gokaldas Exports Limited; NarendraAlready 28 institutes and textiles our economy. In the last few years, Dalmia, CEO, Strata Geosystems;research association have training we have seen tremendous interest Milind Hardikar, Executive Director-facilities for technical textiles and the amongst domestic and foreign Advanced Textiles, Welspun India Ltd;plan is to strengthen this and add a investors to understand and invest K Ramachandran Pillai, Chairmanfew more in times to come. in this sector. What is needed now and Managing Director, National Naina Lal Kidwai, President, FICCI, is to convert this interest into real Textile Corporation Limited; Gautamsuggested four policy measures for investments, he said. Khanna, Executive Director, 3Mthe growth of the sector. Firstly, there The conference was attended by India; Dr. Ashwan Kapur, Managingis a need to chalk out now a long a galaxy of CEOs from Indian and Director, Uniproducts (I) Ltd andterm plan or vision for this sector in foreign companies institutions, Naishadh Parikh, Director, Thea strategic manner. This plan needs including, Shishir Jaipuria, Managing Arvind Mills Limited. January 2013 || FICCI Business Digest || 15
    • Youthfulpopulation,urbanisationwill drivetourismgrowth:Amitabh Kant Amitabh Kant, CEO and MD, Delhi Mumbai Industrial Corridor Development Corporation, addressing the FICCI’s Conclave on ‘Investment in Tourism Infrastructure’.I ndia’s youthful population and near Asansol in collaboration with Tourism Ministry has identified 54 the rapid spread of urbanisation Changi Airport of Singapore. mega destinations and circuits of will drive the setting up of He said new hotels are being put national importance and is in thehotel and other hospitality-related up by global majors such as Radisson process of identifying more suchinfrastructure as the country is set to Blue, JW Marriot, Westing Group, projects at culturally and historicallywitness vast movement of Indians not The Lalit, Country Inn & Suites, ITC, important sites. The Ministry alsojust domestically but also to overseas Taj Gateway, Mayfair Group, Best provides Central financial assistancedestinations, Amitabh Kant, CEO Western and Fern & Ecotel. for the development of megaand MD, Delhi Mumbai Industrial West Bengal, he said, offered an projects and ensures convergenceCorridor Development Corporation, exhilarating travel experience with of resources and programmes of thesaid in New Delhi on January 16, 2013. the grand Kanchenjunga Himalayan ministries to ensure that tourism- Speaking at ‘FICCI’s Conclave on peak overpowering the State, Dooars related and urban civic infrastructureInvestment in Tourism Infrastructure’, foothills, tea gardens and forests, Bay complement each other.Kant said the multiplier effect of of Bengal beaches, largest riverine Alkesh Patel, Chairman, Asiantravel and tourism far surpasses any delta in the world – the Sundarbans American Hotel Owners Associationother sector. Worldwide, tourism – great rivers and cruise options, (AAHOA), the largest hotel assoc-creates 450 million jobs annually heritage sites of the colonial era, iation in USA, stressed the need toas against about 50 million by the mega city spice walks and night life, tap the expertise of the members ofsoftware sector. and festivity and lifestyle tours. AAHOA in setting up franchisee Putting India on the world tourism Dr. Mitra and others released hotels in India. The associationmap would require focused attention FICCI’s knowledge paper entitled, members, he said, had met withon what Kant described as the 6Cs ‘Investment in Tourism Infrastructure: every state government departments– civil aviation development, civic Opportunities & Challenges’. in the country and all have soughtgovernance, capacity building, Usha Sharma, Additional Director the expertise of AAHOA membersconstant communication strategy, General, Ministry of Tourism, in diversifying their tourism product.convergence with other sectors and Government of India, pointed out Dr. Arbind Prasad, Director General,community participation. that the Government’s target of FICCI, noted that with domestic Dr. Amit Mitra, Finance Minister of attracting one per cent of the world tourism growing at 12-14 per centWest Bengal, urged investors to cash tourist arrivals by the end of the 12th a year and the Government givingin on State’s initiatives to upgrade and Plan (2017) from the 2011 level of inbound tourism a thrust, sustainedcreate new tourism infrastructure 0.6 per cent would require about two levels of investment would be requiredprojects. The State Government was lakh additional rooms in the three- for building tourism infrastructure.proposing to expand the Bagdogra star or higher category classified He said that over 200 airports wereairport. A new international airport hotels located outside cities with a planned to be built in the country, foris coming up at Audal near the population of over one million. which investment, both domestic andindustrial hub of Durgapur and a Sharma said that in view of the foreign, would be critical.new airport has also been planned increased inflow of tourists, the16 || FICCI Business Digest || January 2013
    • ADVERTORIALLogistics Hub Luxembourg – Putting Europe at your fingertipsLocated in the heart of Europe, Luxembourg for multimodal transportation modes. Theprovides global companies with many company operates a road/railway service forstrategic advantages for conducting successful standard unaccompanied semi-trailers thatbusiness in Europe. Indeed, with its open and connects Luxembourg to South of France.export-driven economy, Luxembourg is fullyintegrated into the EU common market, yet Dedicated infrastructure andoffers commercial neutrality: Luxembourg is highly skilled peoplethe ideal gateway to the European market withsome 500 million consumers. Cross-border thinking, mobility and the cosmopolitan nature of its workforce, of whom more than one third commutes each day fromIdeal gateway to the European the three neighbouring countries, contributemarket to the high productivity of Luxembourg. TheAirlinks to all continents Ministry of the Economy and Foreign Trade Kühne&Nagel © Marc SchmitLuxembourg’s international airport is the 5th has developed and owns logistics parks in thelargest freight airport in Europe and home immediate surroundings of the Luxembourgbase of Cargolux, Europe’s leading all-cargo Airport (Eurohub Centre) and of major railway consumer market. World-class logistics playerscarrier. The global network of Cargolux and and highway corridors (Eurohub South). such as Cargolux, China Airlines, Cobelfret, DBother airfreight carriers offer multiple daily Created in 2009, the Cluster for Logistics Schenker, DHL, Kühne+Nagel, Morrisson Express,destinations to all continents and make Luxembourg offers a noteworthy exchange Nippon Express, Panalpina, TNT, Yangtze riverLuxembourg an ideal gateway to the European platform for all concerned actors (public and and Yusen Air & Sea, to name but a few, havemarket. Luxembourg’s airport cargo centre, private) active in the field of logistics. already chosen Luxembourg as an operatingwith its planned capacity of 1.2 million tons base for added value logistic activities.of freight per year, offers a high level of quality Favourable tax and regulatoryservice. With its modern and well-equipped air environment Why Luxembourg?freight handling facilities, LuxairCargo offers Luxembourg stand apart is the fact that it Fiscal representationsecure, efficient and speedy ground handling manages to combine a unique series of assets:allowing for jumbo freighter planes to be Businesses that source their goods from outsidecustoms cleared and unloaded at a record the European Union do not need a fixedspeed of as low as 90 minutes. Trucks are a establishment in the country of destination to Sound economic fundamentalsminute away from the open road, and less than comply with their fiscal obligations. They may Today the Grand Duchy enjoys the highest24 hours from any European city. use the service of a fiscal representative that standard of living in Europe, low inflation and takes care of their import declaration, payment unemployment, competitive corporate and of VAT due, if any, and other duties such as the personal income taxes and a balanced budget.A hinterland port reporting of intra-Community supplies as wellMoreover, CFL Cargo (conventional rail freight) as the statistical and VAT declarations for theand CFL multimodal (containers) operate daily importation of goods. Luxembourg: connecting peoplerailway connections to the ports of the North Located in the “Heart of Europe”, LuxembourgSea making Luxembourg a hinterland port of offers well-developed transportation and Authorised Economic Operator (AEO) communication networks. The extended roadAntwerp, Zeebrugge, Amsterdam, Rotterdamand Hamburg. To comply with EU security standards, the and rail system as well as the Luxembourg Luxembourg Customs authorities have international airport link the country with implemented the AEO certification. This concept economic and political centres throughout theOutstanding connectivity to the gives reliable operators the status of a secure andEU consumer market world. trustworthy operator of the supply chain.Established at the junction of major North-South and East-West railway and motorway An exceptional business environment Recognised certification agency A free market approach gives businesses broadcorridors, Luxembourg lies at the heart of the Many international automotive, medical freedom of action. It is a small country whereEuropean road and rail network thus providing devices and electronic manufacturers take business can be developed easily and directly,an easy and uncongested access to the advantage of the know-how and the efficiency avoiding cumbersome administrative red tape.European consumer market. of Luxembourg’s certification agency (SNCH), The Government is willing to provide tailor-CFL multimodal manages the country’s which offers EU wide recognised services. made incentives for investment, research andmost important container terminal, which development.is located close to the largest marshalling No VAT pre-financingyard in the region. The company offers acomplete and professional service such as Importing goods into the EU generally A high quality of lifehandling, trans-shipment, storage and loading triggers a Value Added Tax (VAT) liability in the A high standard of living and a comparativelyof containers, customs clearance, security country of importation, unless the goods are low cost of living provides an ideal basis onchecks, organisation of combined rail and placed under a specific warehousing regime. which to build future development and success.road transports. With its rail-road piggy-back Most EU countries require for immediateservice, Lorry-rail provides innovative solutions payment of VAT. Luxembourg’s advanced VAT regulations have completely eliminated that Social and political stability process. While several other EU countries allow Social conflicts in the Grand Duchy are avoided similar processes upon request and under by regular consultations between the various certain conditions, Luxembourg is the only social partners and the Government. country that never requires VAT pre-financing (automatically and unconditionally). Therefore, Contact no cost is linked to the pre-financing of import Nidhi Palta, Project Manager VAT in Luxembourg. Luxembourg for Business – Trade and Investment Office in New Delhi World class logistics players Tel: +91 11 4998 6607 An important number of qualified players (i.e. Email: nidhi.palta@mae.etat.lu carriers, handling agents, forwarding agents Web: http://investinluxembourg.in and logistics service providers) provide quality www.luxembourgforbusiness.lu service allowing just-in-time access to the EU http://newdelhi.mae.lu/en Cargolux © P. Steichen
    • I ndia’s growth story and its international partnerships help in FICCI Skills Development endeavours in skills development deeper understanding of effective Forum: Fostering International share a deep symbiotic relatio- approaches to skills development, Partnershipsnship which needs to be nurtured whilst raising the profile of vocational FICCI has been working closelyif a double digit growth rate has to and technical education and with almost eleven countries on thebe re-achieved. According to Grant enterprise skills. International Collaboration agendaThornton’s Global Dynamism Index through its Skills Development2012 we are the fifth best country International Collaboration in Forum (SDF) which has fed intoin the world for dynamic growing skills is an opportunity for: policy debate and initiatives likebusinesses. However, ironically, on • Exchange of best practices and the Sector Skills Councils (SSC),the parameter of Labour and Human sharing of new methods National Qualification Framework,Capital, the world’s second largest • Improving knowledge and setting up of Community Colleges,labour market i.e. India does not understanding of effective developing an Employer Engagementeven make to the top 10. ‘Output approaches to skills development Network and mutual recognition ofper worker’ often remains a key area • Applying the newly acquired qualifications.of concern for all businesses. With knowledge and experience in 2012 witnessed an unprecedenteddirect correlation to productivity, increase in international interest on skills in institutions/organisationsskills development is the buzz skills and training front. Organisations • Building new, and strengtheningword today. Whether it is the slow over the world are looking at the Indian existing, relationships witheconomic pace or the FDI booster, skills industry as the next big market.the time is right to get our ‘skills’ act ministries, key skills agencies and employers Skills is a 20 billion dollar per annumtogether. It is imperative to leverage industry according to National Skillsinternational expertise in the area of • Enhancing India’s reputation as a source of Skills and the capital for Development Corporation (NSDC)skills development and vocation if we with very little regulation and hugeare to create a ‘glocal’ workforce. skilled labour. scope for benchmarking and best Working with international partnerscan foster innovation and investmentsin the area of skills development.It can help build new partnershipsand develop new commercialopportunities. India needs much Leveraging internationalexpertise from partner countriesthat have experience in impartingskills and have developed innovative expertise for a skilled Indiamethods of vocational training. Also, Pooja Gianchandani & Nikhil Kumar* A special session with Training Delegation from Belgium.Anand Sharma, Minister of Commerce & Industry (third from left), launching the India-Uk report on skills at JETCO Meet 2012.18 || FICCI Business Digest || January 2013
    • practice sharing. With a focus towards » Bi-laterals and Joint Working • Promoting Vocational Educationencouraging knowledge transfer and Group’s: FICCI is an active in Schoolsa clear understanding of the skills member of several skills working • Capacity Building and Qualitymarket, FICCI SDF has evolved its groups that facilitate bilateral Management of private traininginternational collaboration agenda dialogue on a country to country providersaround three main pillars: basis. Our most successful • Leadership Development• Active engagement in Bi- partnerships have been through Program for managers of the laterals, Joint Working Groups, the JWG on Skills and Vocational education and training companies Partnerships through MoUs Training with Germany and UK. Cross sectoral collaboration – the• Promoting Business to Business retail and food groups have been (B2B) by fielding Delegations – India UK Joint Working Group on merged with skills group both Inwards and Outwards Skills Development under JETCO• Creating networking Indo German Working Group opportunities through events, on Vocational Education and seminars, workshops and Training roundtables Managed by FICCI & UKIBC A Memorandum of Understanding (MoU) concerning Cooperation inFICCI SDF collaborates with the best India UK Joint Economic Trade the field of Vocational Education andinstitutions around the world for Committee: The India UK dialogue Training, was agreed between theknowledge transfer related to global on skills acquired pace when the Federal Ministry of Education andbest practices in skill development, Joint Economic Trade Committee Research (BMBF) and the Indianfacilitates dialogue on bilateral formed the Joint Working Group Ministry of Labour and Employmentbasis, creating opportunity for B2B (JWG) on Education and Skills. (MOL) at the German-Indian Interg-collaboration and offer technical From being a small initiative to now overnmental Consultations in Newadvisory in doing business in the becoming a vibrant partnership Delhi on 31 May 2011. FICCI is anskills development space. and much has been achieved in the active member of the Indo German short span of time. The UKISF has Working Group on Vocational facilitated delegations, encouragedWorking with business partnerships, and engaged Education and Training. As per the roadmap document evolved, FICCI isinternational partners the government to supporting these working for the areas of collaboration:can foster innovation partnerships. It has evolved into a • Upgradation and establishment of platform where UK & India, shareand investments information and experiences, explore vocational training institutions • Training of Trainersin the area of skills the possibility of joint initiatives in • Creating a public private skill building activities.development. India A 5 point agenda, as per below, was partnership based on the pattern of the German Dual System inneeds much expertise evolved during the JETCO meeting companies in India in April 2012 to concretize thefrom partner countries partnerships: • Research and development in thethat have experience • Elevating the India UK business field of vocational training • Development of competencyin imparting skills partnerships by creating standards opportunities for Indianand have developed companies to participate in the • Coordination, networking and identification of new fields ofinnovative methods of UK skills and training market. cooperationvocational training.RCM Reddy, CEO & MD IL&FS Education and Chairman FICCI SDF (centre) and James Knight, President & CEO, ACCC (third from left)at Indo-Canada workshop. January 2013 || FICCI Business Digest || 19
    • The Indo German Skills Forum FICCI also signed a MoU with to cover up the widening demand –(IGSF) is a bilateral cooperation group Association of Community Colleges supply skill deficits amongst Southformed to promote the Business to in Canada during the Global Skills Asian workforce. FICCI and LahoreBusiness (B2B) interaction between Summit 2012 with the objective Chamber of Commerce and IndustryIndian and German companies. of sharing the Canadian college’s (LCCI) along with NUEPA organizedThis forum is managed by FICCI experiences in focusing on the learners this roundtable which was attendedand iMove to facilitate private sector in ensuring that they get jobs after by over 30 companies in various fields.interaction to promote bilateral graduation; and to explore the areas Roundtable with Burton and Southtrade dialogue under the aegis of of collaboration between Canadian Derbyshire College- The discussionthe Indo German Working Group colleges and Indian institutions and was to evolve partnerships in keyon Technical Vocational Education private sector. A special workshop Sectors and identification of skill& Training (TVET), chaired by the on Advanced Skills for Employment: gaps in different sectors. The need ofSecretary, Ministry of Labour and Opportunities for India Canadian standard model for the skill trainersEmployment, Government of India. Cooperation was also organized by in India was stressed and the lack FICCI and Education Canada as a of content writers and assessors wasIndia New Zealand Education precursor to the MoU signing. expressed.Council (INZEC) “English language an essential skillIn the Joint Statement between » Facilitating B2B through for Job Readiness” – a round tableIndia and New Zealand released FICCI’s Skills Marketplace: discussion with Cambridge Universityon 28.6.2011 during the visit of exclusive opportunity for ESOL- The group discussed variousH.E Mr. John Key, Hon’ble Prime direct B2B interaction between aspects of developing and managingMinister, New Zealand to India, it International companies trying initiatives to improve English lang-was announced that both sides will to identify suitable Indian uage skills of the learners across skillestablish a Joint Education Council partners and Indian companies sets and felt that it is critical to defineto implement the Prime Ministers’ seeking foreign collaboration. the appropriate language standardsinitiative. The initiative will focus The participating companies get a for industry especially Retail,on areas such as academic and unique opportunity to explore the Telecom, Travel and Tourism, IT,student exchanges, joint research areas of collaboration with their Manufacturing, Banking & Finance.activities and industry collaboration. counterparts through dedicatedThis India-New Zealand Education » Show-Know-Grow Conferences: slots of 10 minutes for interactionCouncil (INZEC) is expected This is a unique series of with each other.to bring together Government, conferences organized by FICCIacademia, business and industry of » International Skills Round- tables: To facilitate the skills SDF were we offer Internationalboth the countries to further bilateral partners an opportunity to:collaboration in the education and ecosystem not only from the perspective of learning, but also • Show: demonstrate theirskills sector. Chairman, FICCI SDF sharing of best practices, FICCI capability and also share theirleads the Leadership Development organised industry roundtables best practices in the vocational,and Professional Development forVocational Education and Training with various countries to position education and skills spaceagenda of INZEC. FICCI hosted a India as the skills development • Know: discuss and learn about thedelegation of 20 vocational and skills hub. skilling India needs and the scaleservice providers recently. of the opportunity The first-ever ‘Roundtable on Skills for • Grow: Interact with the keyIndia Canada Advanced Skills Employability in South Asia’ was held players of the industry andCommittee in Lahore to explore ways and means discuss B2B opportunitiesAs a member of the India CanadaAdvanced Skills Committee led byIndia Canada Business Council,FICCI SDF pursues the followingagenda: Acclimatizing / Briefing Sessions – Organizing an introductory session for any delegation on Indian business environment, Govt. rules and regulations, Case studies. Supporting Business to Business or Government to Government meetings Organizing seminars, workshops, round tables etc on Indo Canada related topics Skills Marketplace: Special Indo-German B2B session on Skills Development.20 || FICCI Business Digest || January 2013
    • India & Sweden: Exploring scenario. Similarly, it also takes “International collaborations inOpportunities in Skills members of SDF to foreign skills could play a very importantDevelopment: countries for grasping new role in our skill developmentThere is a need to engage with Sweden, knowledge and new experiences. initiative by helping fast-trackwhich has evolved as a partner of This year a delegation of FTMA, the establishment of structuresIndia, contributing to the economy an organisation from Belgium and frameworks for impartingwith its several high-profile and working in the metal and electro- best-in-class vocational educationemployment intensive companies. It technical industry visited to and training in this country – analso has a culture of quality, which explore economical, social and essential pre-requisite for IndiaIndian market and the learners need educational opportunities in being able to leverage its favorableto adapt comprehensively. At the India. demographics for achieving asame time, India offers a significant » WorldSkills India Competition- faster and a more inclusive growth.market to the Swedish companies, The World Skills competition,its vast demography, and a promise which takes place in more than Countries like Germany,of long-term relationship. This fifty countries, is conducted in Switzerland, Australia, the Unitedprogramme provided a platform for India by FICCI (with NSDC Kingdom, etc – which already haveIndian & Swedish companies to ideate partnership) and is helping in well-defined VET frameworks,and engage on new opportunities, raising the profile of various Skills. including the role of industry inpartnerships and focus on developing Its ultimate aim is to make these skills promotion efforts – as welllong term relationship. It was graced trades of confectionery, cooking, as groupings such as the Europeanby the presence of Minister of plumbing, fashion technology Union and agencies like theEnterprise of Sweden, H E Annie and graphic design aspirational. International Labour OrganisationLööf. (ILO), for example, could prove The Way Forward very useful reference points forIndia-Queensland: Collaboration on The world is growing old; India is not. India as it tries to create a skillsSkills Development - The Premier of The future of the world is India and culture among its people.”Queensland, Mr. Campbell Newman India’s future is in the hands of policies and policy makers. The topmostled a business delegation to India Dilip Chenoy, agenda for policy makers in Indiastarting and explored opportunities in CEO & MD, NSDC should be expanding employmentSkills, Education & Training in India. and increasing productivity. TheFICCI partnered with Government partners on some areas; some of them way forward is to focus on skilledof Queensland to organise Show- have been given below. International labour and technological capability,Know-Grow conferences in 3 cities expertise in these areas is necessary which are increasingly becoming–Hyderabad, Mumbai, and Delhi. as they have been previously worked the touchstones of competitiveness on in foreign countries and India can in an open and integrated world» Delegations: FICCI SDF hosts do better with their experience. environment and through skilling, delegations from across the world productivity will increase and jobs to enrich the Skills development will be created, which ultimately will * Pooja Gianchandani is Director & space with new ideas and spur growth. Skills sector still needs Nikhil Kumar is Assistant Director, Skills knowledge to improve the Indian greater engagement of international Development, FICCI.Taster Workshop on Application of modern training methods in TVET. January 2013 || FICCI Business Digest || 21
    • R P Singh, Chairman, National Technocrats Pvt. Ltd and Dr. A Didar setting, regulation of service quality, Highways Authority of Singh, Secretary General, FICCI. assessment of concessionaire claims, India (NHAI), underlined According to Ernst & Young, collection and dissemination ofthat it was essential to get the States there was a need for an independent sector information, service-levelon board in the development of regulator in the highways sector. benchmarks and monitoring compli-road network in the country. “States The current arrangement both at ance of concession agreements.were putting all the responsibility on the Centre and States – Ministry There was also the need for theNHAI. They must share the cost of of Road Transport & Highways, State governments to extend theirdeveloping highways and undertake NHAI, PWDs, etc. – results in a active cooperation for enablingcapital expenditure for funding the potential conflict as the rule making successful implementation of PPPprojects,” he said while addressing a body is also the implementing body projects by signing the State SupportFICCI conference on ‘Accelerating the and there was no independent Agreements for PPP projects andDevelopment of Highways in India’ in assessment of its performance across providing the necessary support andNew Delhi on January 17, 2013. various parameters. The key func- assistance in letter and spirit. Singh said that the challenge of tions of the regulator could be tariffbuilding the highway network weremanifold. For undertaking 8000-9000 kms of roads, roughly Rs 91, 000crore was required. If a third of this States must come on boardcomes from equity, the remainderRs 60,000 would have to be debt- for development of highwaysfinanced. He asked, are banks ina position to finance such a largeamount in a non risk-free situation? He said the cost of acquisition ofland for road projects was escalatingat a rapid pace. There were issuessuch as decrease in traffic due tothe economic downturn and risingcost of raw materials. There werevoices against collection of tolls aselections draw near. In any case, itwas extremely difficult to index tollcharges with inflation as the capacityto pay of the consumers has to beborne in mind. As far as implementation ofprojects was concerned, delays werebeing caused due to the existence offar too many stakeholders. It was acase of ‘Too many cooks spoiling thebroth’, he said. While the PlanningCommission and the Department ofEconomic Affairs should lay downpolicy guidelines, the nitty-grittyof implementation should be leftto NHAI; its board must have fullauthority, he said. He suggested that there was a needto liberally allow transfer of equity sothat the stronger players can comein and pump equity into highwayprojects. Yet, the challenge was tode-risk projects for private equity tocome in a big way, he said. The session was also addressed byAbhaya Agarwal, Partner, Ernst &Young; K K Kapila, Co-Chairman,FICCI Infrastructure Committee and R P Singh, Chairman, National Highways Authority of India, addressing the conference onCMD, International Consultants and ‘Accelerating the Development of Highways in India’.22 || FICCI Business Digest || January 2013
    • Proactive disclosure on water use by industry is vital environmental costs of their decis- that any plan document has included a ions. Similar to the disclosure on separate Chapter on Water Resources. energy use by industries, disclosure The fact that access to adequate and about water usage and trends across safe water is becoming a growing years will highlight industries comm- concern across different sectors is itment to conserving water. The the underlying theme in the Chapter. benefits of measuring water use and There is an emphasis for a paradigm wastewater discharge will enable shift in the way water resources are industries to develop a water reuse, managed in our country. conservation and management plan. Disclosure on water use can serve Workshop on Water Disclosure as an important piece of information for a wide range of stakeholders. For FICCI and Carbon Disclosure ProjectDr. Mihir Shah, Member, Planning investors, it would mean that they (CDP) India organised a workshopCommission. have specific information on water to understand the feasibility of water use and sustainability measures so disclosure in India on January 21, 2013. that they can divert capital flows Dr. Mihir Shah, Member, PlanningI ndia’s rapidly growing economy to businesses with good water Commission, outlined the 10-point is driving increased water usage management policies. Civil society paradigm shift proposed in the across different sectors. Various can use data to analyse the impact 12th Plan. Participatory irrigationestimates and projections indicate an of industrial activity on the state of management with central emphasisincreasing trend in water demand for water resources. The governments on command area development;agriculture, industrial and domestic would use this information in participatory aquifer management;uses in the coming decades. At this shaping national and local regulations breaking the groundwater-energypoint, it is imperative to enquire, what that encourage sustainable water nexus; watershed restoration androle Indian industry sees for itself management. groundwater recharge; conjointin the emerging scenario; wherein While disclosure is important, water and wastewater managementthere is rapid depletion of freshwater making the right kind of information in urban areas; better databasesources coexisting with the need available is of greater significance. In management and new institutionalto sustain a growing economy. A respect of industrial water use, this and legal framework were some ofgrowing economy will translate into would mean that industries while the reforms proposed as part of theincreased intake of water for the water reporting on physical use of water paradigm shift.intensive industrial sectors such also indicate the sources of freshwater. Dr. Shah emphasised that the timeas thermal power plants, steel and The information should also indicate has come for industries to understandtextiles. Within the industrial sector, water related risks in respect to the water-related risks and take measuresthere is also a growing realisation local context and measures which for conservation of freshwater andto save water for its future growth. will be put in place to reduce/better recycling of wastewater. He laudedAs a result, one witnesses initiatives manage water resources. At a later the efforts of FICCI Water Missionundertaken by several industries stage, when industries are familiar in enhancing the knowledge base onacross different sectors, but there is a with the water use in their processes, best practices and urged the Missionlot more that the industries could do attempts can be made to account for to come up with demonstrationin order to effectively manage water the water practices of their supply projects. The Bureau of Water Useresources. chain. The practice of disclosure Efficiency, to be set up by the Ministry can also be seen as a chance for the of Water Resources will be the nodalCase for Disclosure industry to highlight the impacts of authority to engage with industries the interventions on water harvesting, on improving water efficiency,Proactive disclosure on water use recharge on the state of freshwater Dr. Shah remarked.by industries will go a long way in resources in the area.bringing in a culture of decision The12th Plan document is historic *Romit Sen is Senior Assistant Director,making, which accounts for the in the sense that it is for the first time FICCI Water Mission.24 || FICCI Business Digest || January 2013
    • FICCI celebrates National Consumer Week FTop ICCI’s Committee Against paintings by the students brought toL to R: Anil Rajput, Chairman FICCI Smuggling & Counterfeiting the fore steps, which can be taken byCASCADE; Pankaj Agrawala, Secretary Activities Destroying Economy consumers to avoid being duped intoMinistry of Consumer Affairs Food Supplyand Distribution; Naina Lal Kidwai, (CASCADE) celebrated the ‘National purchasing these fake products, withPresident, FICCI; A Didar Singh, Secretary Consumer Week’ from December the help of topics such as ‘Buying aGeneral, FICCI and Meenu Chandra, Head, 18 to 20, 2012, as a run up to the product without receipt – SensibleFICCI CASCADE. ‘National Consumer Day’, which was or Dangerous’ and ‘Be responsible: celebrated on December 24, 2012. Insist on a bill’. All the studentsBelowL to R: Anil Rajput, Chairman FICCI The National Consumer Week who participated were awardedCASCADE; Pankaj Agrawala, Secretary was flagged off with the ‘Awareness certificates and the students of St.Ministry of Consumer Affairs Food Supply through Art’ programme on Dece- Thomas, Sahibabad; Mount Carmel,and Distribution and Rajeev Batra, mber 18, 2012. More than 272 Dwarka and Modern Public School,Co- Chariman, FICCI CASCADE. students from Delhi-NCR schools Barakhamba won the first, second participated in an ‘On the spot and third prize respectively, and interschool painting competition on were awarded cash prizes by Renu consumer rights’. Agrawala, Design & Publication The competition focused on the expert. detrimental effects of smuggled, This was followed by ‘National counterfeit and fake goods on the Consumer Rights Meet’ on December health and safety of consumers. The 19, 2012, where Consumer Rights26 || FICCI Business Digest || January 2013
    • Activists from various states of India During the seminar, CASCADE, asgathered to discuss the future course part of its efforts to create awareness,of the Consumer Rights Movement. commissioned a special study on Pankaj Agrawala, Secretary, the ‘Socio-economic impact ofMinistry of Consumer Affairs, said, counterfeiting smuggling and tax FICCI-CASCADE“The market was becoming complex evasion in seven key Indian industrywith service industry overtaking the sectors’ of the economy. The report would continuemanufacturing industry.” A sizeable prepared by the Thought Arbitrage its efforts tosection of the population was not even Research Institute (TARI), New create consumeraware of quality products. Further, he Delhi, made a pioneering attempt towanted consumer organisations to estimate the size of the ‘grey market’ awareness throughbe more active in creating awareness for selected industry sectors in various campaignsand assured that the Ministry of India and projected the economicConsumers Affairs will lend its loss to industry, government and throughout thesupport to the cause. consequent social impact. nation. The consumer Anil Rajput, Chairman, FICCI- Commenting on the findings, activists agreed thatCASCADE, said, “Awareness is FICCI President Naina Lal Kidwaithe beginning of change.” FICCI- said, “Counterfeiting was a serious there was a need toCASCADE would continue its efforts economic offence causing a huge loss bring about a changeto create consumer awareness through to industry, to the government andvarious campaigns throughout the also to consumers. But it was still not in the Consumernation. During the panel discussion, considered as a serious offence.” Protection Act andthe consumer activists agreed that A Didar Singh, Secretary General, provide a mechanismthere was a need to bring about a FICCI, said that consumers todaychange in the Consumer Protection were compromising their safety, as for speedy trials ofAct and provide a mechanism for the products consumed by them the consumer cases.speedy trials of the consumer cases. were not of the set standards because A seminar on ‘Building a Consumer they were not coming from theRights Movement-Empowering the manufactures who actually promisedConsumer of Today’ on December them safety and adequate quality.20, 2012, was organised where theMinister of Consumer Affairs, FoodSupply and Distribution delivered the The winners of the painting competitionkeynote address. with Renu Agrawala Design & Publication expert (centre). January 2013 || FICCI Business Digest || 27
    • CSR in Companies Bill 2012 The Companies Bill 2012, after due discussions with stakeholders was cleared by the Indian Parliament on December 18, 2012. The new law mandates 2% of profit after tax (PAT) of preceding three years to be spent on CSR activities. I ndia has a long tradition of close business involvement in social causes for national development. In India, Corporate Social Responsibility (CSR) is known “The idea was to give it a structure, a shape, from ancient time as charity, which regularise it in a way that it becomes formatted. through different ages is changing its nature in broader aspect, now And, we are following a principle of self-reporting. generally known as CSR. CSR has I am very confident because the private sector, been a part of the Indian business the corporates — they themselves want to build since late 1800s. Most corporate houses have been operating with a bridges with the community. I also think it help social conscience that is an inherent them enhance their brand value and their presence part of their business strategies. With the changing national and global in a very positive fashion. I am very confident that expectations, Indian companies they want to come over and do it as long as there is are responding to the market expectations through responsible absorptive capacity in the area to get the CSR done.” business practices, but CSR in India to some extend is philanthropy. It is Sachin Pilot still considered external to business, as opposed to an internal process. Minster of State for Corporate Affairs, But now India is at an interesting Government of India threshold with the enactment of the Companies Bill 2012 has made CSR necessary for businesses to engage.28 || FICCI Business Digest || January 2013
    • The Companies Bill 2012, after due of the company made during • Contribution to PM’s fund ordiscussions with stakeholders was the three immediately preceding any other fund set up by thecleared by the Indian Parliament on financial years, in pursuance of its Central Government or the StateDecember 18, 2012. The new law Corporate Social Responsibility Governments for socio-economicmandates 2% of profit after tax (PAT) Policy; Provided that the company development and relief and fundsof preceding three years to be spent shall give preference to the for the welfare of the Scheduledon CSR activities. local area and areas around it Castes, the Scheduled Tribes, other where it operates for spending backward classes, minorities andWho must comply? the amount earmarked for CSR womenEvery Company registered under the activities; Provided further that if • Ensuring environmental sustaina-Companies Law or any previous laws the company fails to spend such bility(Section 1) If (Section-135): amount, the Board shall, in its • Social business projects• Net worth of Rs 500 crore or more financial statement made under • Such other matters as may be• Turnover of Rs 1000 crore or more clause (o) of sub-section (3) of prescribed• Net profit of Rs 5 crore or more section 134, specify the reasons for during any financial year not spending the amount i.e. the What does a company need to details about the policy developed disclose in the Annual Report?Who will be held accountable? and implemented by the company • CSR policy, initiatives and the CSR• The company will constitute a on corporate social responsibility committee Corporate Social Responsibility initiatives taken during the year • Amount of expenditure incurred Committee of the board members of sub-section (3) of section on corporate social responsibility consisting of three or more 134, specify the reasons for not activities directors spending the amount • Valid reasons in case of failure to• At least one committee member spend the earmarked CSR budget shall be an independent director How much will a company be required to spend on CSR? What if the company contravenesWhat will the CSR Committee do? • Ensure that the company spends, the provisions of clause 135?• Formulate and recommend a CSR in every financial year, at least • If a company contravenes the Policy and an indicative list of 2% of its average net profit made provisions of clause 135, shall be activities to the Board during the three immediately punishable with fine which shall• Recommend the amount of preceding financial years not be less than Rs 50,000 but expenditure to be incurred on the which may extend to Rs 25 lakh and activities What are the activities your every officer of the company who is• Monitor the Corporate Social company can undertake? in default shall be punishable with Responsibility Policy of the According to Schedule VII, Activities imprisonment for a term which company from time to time – as a Project Mode, which may may extend to 3 years or with fine be included by companies in their which shall not be less than RsWhat will be the role of the Board Corporate Social Responsibility 50,000 but which may extend toof Directors? Policies, are: Rs 5 lakh, or with both under Sub• Review the recommendations • Eradicating hunger and poverty Section (8) of Section 134. made by the CSR Committee • Promotion of education• Approve the CSR Policy for the • Promoting gender equality and company empowering women• Disclose contents of the Policy in • Health – reducing child mortality, the company’s report/website improving maternal health,• Shall ensure that the company combating HIV, AIDS, malaria spends in every financial year, at • Employment enhancing vocational least 2% of the average net profits skills January 2013 || FICCI Business Digest || 29
    • 12th Businessworld-FICCI CSR AwardR V Kanoria, the then President of FICCI, addressing the 12th Businessworld CSR Awards.“No business can run in I n 2012, 14 companies were ackno- overall corporate strategy. Over wledged for their commendable the years, the Award has not justisolation, the revenues, CSR initiatives by the Minister grown in size but in stature and isthe market, the products, of Corporate Affairs Sachin Pilot at presently recognised as one of the an award presentation ceremony on most coveted awards in the areathe services that we all December 7, 2012, in New Delhi. The of CSR. The initiative has givengive and provide is for companies were acknowledged for various companies an opportunity tothe community, not their commendable work in the area showcase exemplary initiatives taken of model village creation, integrated up by them.just to fulfil their daily watershed development programme, The awards had three categoriesrequirement but also sustainable livelihood & agriculture, namely: rural digital infrastructure devel-to have a sustainable, opment to creating employment Category I – CSR Award forsymbiotical relationship opportunities for the tribal youth and Companies with turnoverbetween the enterprise persons with disabilities. a. Rs 3001 crore per annum FICCI and Businessworld instituted and aboveand the community.” India’s first Corporate Social b. Turnover between Rs 101 Responsibility (CSR) Award in 1999 crore – Rs 3000 crore per to encourage corporate participation annum in inclusive growth. Until last year Category II – CSR Award for it was known as the Businessworld- Small and Medium Enterprises FICCI-SEDF Corporate Social (SMEs) with turnover Responsibility Award. • Up to Rs 100 crore per It is an annual award that aims annum at identifying and recognising the Category III – Award for efforts of companies in integrating Exemplary Innovation and internalising Corporate Social promoting CSR Responsibility (CSR) in a strategic and systematic manner with their30 || FICCI Business Digest || January 2013
    • Winners of 12th Businessworld FICCI CSR Award Category Ia – Large Enterprises Winner: ITC Limited Category Ib – Large Enterprises Winner: Deepak Nitrate Limited Category III – Exemplary Innovation Promoting CSR Winner: SRF Limited Special Jury Commendation Tata Teleservices Limited Companies acknowledged for their commendable CSR initiatives Adobe Systems Suzlon Thriveni Earthmovers Pvt Limited Essel Mining and Industries Limited National Stock Exchange JSW JK Paper Limited Cairn India Limited NTPC TATA Motors LimitedThe award assessment followed companies. The second assessment This annual awardan exclusive three-tier assessment include partner checks, interviewsprocess, independent of the orga- process owners to assess what aims at identifyingnisers. This year more than 100 drives CSR, time spent by the senior and recognising theapplications were received and 14 management/CEOs, to checkingcompanies were shortlisted in the of external/internal evaluations, efforts of companiesstage one of the assessment. At stage understanding of internal and in integrating andone assessment, nominations received external stakeholders of the company, internalising Corporatewere thoroughly scrutinised by HR & environmental practices toreputed international accountants and interviews with the beneficiaries Social Responsibilitybusiness advisors, Grant Thornton, for the impact and accessing the in a strategic andIndia as per-defined indicators for sustainability of the communityspecific category. The indicators programmes. systematic manner withincludes institutionalisation of Finally, an Independent Jury comp- their overall corporateCSR, drivers for CSR, leadership, rising eminent personalities from strategy. Over the years,structure for delivery of CSR, the relevant spheres made the finalresource allocation, monitoring and selection of the Award winners. This the Award has not justevaluation, documentation, reporting, year the Independent Jury comprised grown in size but inenvironment practices, employee M Damodaran, Former Chairman,volunteering to identification of SEBI (chairman), M K Venu, Mana- stature and is presentlykey communities and its needs, ging Editor, Financial Express, Dr. V. recognised as one of theaction plan, partnerships, impact Mohini Giri, Chairperson of Guild of most coveted awards.and sustainability of the community Service and War Widows Association,development programme. Mark Runacres, Advisor to The Subsequently, Birla Institute of Confederation of British Industry,Management Technology, India, a Sunit Tandon, Director IIMC andwell known Management School, Pritpal Marjara, Managing Director,conducted ‘on-site assessment’ of Population Services International,the CSR work of the shortlisted India. January 2013 || FICCI Business Digest || 31
    • L to R: Vikram Singh Mehta, former Chairman, Shell Group of Companies, India; R V Kanoria, Immediate Past President, FICCI; Sachin Pilot,Union Minister of State for Corporate Affairs; Gurcharan Das, renowned writer and former Head of Proctor & Gamble, India and Dr. Ashok Desai,noted economist, at the FICCI book launch in New Delhi on December 20, 2012.‘An Illustrated History of Indian Enterprise’Re-living the India NarrativeT he Prime Minister, Dr. Manmohan Singh, released the FICCI coffeetable volume ‘An Illustrated History of the West. He cited the example of Reliance’s Jamnagar refinery built by the Ambanis. “The fact remains that ‘An Illustrated History of Indian Enterprise’ provides an evocative account of Indian entrepreneurshipIndian Enterprise’, at the 85th Annual for the first 10 years of its operation and entrepreneurs from the dawnGeneral Meeting of FICCI, in New that refinery was the most successful of civilisation to the present.Delhi on December 15, 2012. refinery in the world, despite the fact With contributions from R V This was followed by a panel that prior to the start of operations, Kanoria, Dwijendra Tripathi, Rdiscussion held on December 20, all feasibility studies suggested that Champakalakshmi, Shireen Moosvi,2013 in New Delhi, where the chief it would be an astounding failure,” Purushottam Agarwal, Ashok Desai,guest was the Union Minister of he said. TCA Srinivasa-Raghavan, OmkarState for Corporate Affairs, Sachin Another interesting point raised by Goswami and Vikram Singh Mehta,Pilot. The panel discussion included Das was that Indian business remains the volume chronicles the Indianeminent personalities in the field mired in tradition despite modernity. business narrative through theof business and economics and He cited the example of the Forbes intersection of history, culture, andcomprised Dr. Ashok Desai, noted Indian billionaire list which invariably commerce to offer a multidimensionaleconomist; Vikram Singh Mehta, is dominated by traditional business perspective. It examines the policiesformer Chairman, Shell Group of communities such as the Marwaris, and institutions that have enabledCompanies, India; R V Kanoria, Baniyas and Khatris. growth, studies the entrepreneurialImmediate Past President, FICCI and Kanoria noted that these are tradi- role of the private sector and theSachin Pilot. It was moderated by tional communities that lean towards role and position of public sectorGurcharan Das, renowned writer and entrepreneurship. He explained that enterprises in the current scenario,former Head of Proctor & Gamble, contemporary Indian business con- and also looks at the possible futureIndia. glomerates are increasingly looking course for Indian business. The discussion began with a debate to dissociate succession and control. This visually appealing andon the reasons behind India’s success “This is the sign of an industry that is substantive publication, is both readerpost the reforms of the early 1990s. maturing and becoming more profes- friendly and scholarly, and shouldAccording to Dr. Desai, India’s case sional,” he said. appeal to all those interested in thewas peculiar as it had been able to Pilot observed that India and its Indian entrepreneurial narrative. Itprogress despite its relatively closed enterprises were still growing, despite also makes for an excellent corporateeconomy. However, he emphasised the slowdown in the global economy. gift showcasing the best of Indianthat to sustain growth, India has to “The bottom line is that of the past enterprise through the ages, from thecontinue to open its economy. “For eight years, for six years we have a Indus Valley till now.this we need to invest heavily in port GDP growth of over eight per centand maritime infrastructure,” he said. and just because this has come down Limited copies of the publication are Mehta said that a big part of the to 6.5 per cent this year, we are all available at the office of FICCI in Newsuccess lay in the fact that Indian pessimistic. The fact remains that Delhi at a 20% discount on its MRP ofbusinesses did not follow the tried 6.5 per cent growth is still decent at Rs. 5000. Please contact Anjana Bishtand tested methods of scientific a time when the global economy is in at 011-2048092/09958109992 or viabusiness management that work in the grip of a slowdown.” email at kokila.rangachari@ficci.com32 || FICCI Business Digest || January 2013
    • T he Pravasi Bharatiya Divas Shah also said that FICCI should (PBD) 2013 held in Kochi, arrange more programmes in Kochi, Kerala, was a great success. which should be in line with state’s FICCI received support from both, needs in the sectors such as tourism, the Kerala Chamber of Commerce & infrastructure development and logi- Industry and the Indian Chamber of stics. Programmes on food safety and Commerce and Industry to facilitate standards and legal metrology could the event. be conducted on a priority basis. On the sidelines of PBD, Dr A Dr Singh briefly highlighted Didar Singh, Secretary General, FICCI’s activities and extended full FICCI and Dr Arbind Prasad, support and guidance to the Member Director General, FICCI, addressed Bodies and was in favour of more the members of Indian Chamber joint programmes in cooperation of Commerce and Industry (ICCI), with the Member Bodies. Kochi at their premises. The meeting Some of the other issues that was attended by nearly 50 members were discussed included, anomaly of ICCI, covering a cross-section of with regard to stamp duty for industries. securities transactions charged by In his welcome address, Nishesh different states and demand for a Shah, President, ICCI, informed uniform stamp duty and need for a that this was the first visit by any master plan for the entire nation on Secretary General of FICCI to their infrastructure. Chamber, which has a history of FICCI office bearers also met 115-years. He said that the Chamber the officials of Kerala Chamber of has been working towards a better Commerce & Industry (KCCI) to environment for economy in terms of strengthen mutual cooperation. business and social activities.Meeting with Regional Chambers January 2013 || FICCI Business Digest || 33
    • New and updatedservices being offeredby FICCI• Website Linkages with Member Bodies –links with 24 Member bodies functional• Latest studies/research & knowledge papers posted on FICCI website• Regional Interactive Meetings with members• Policy papers relevant to different sectors mailed to members at regular intervals• Regular feedback received from the FICCI Members Survey• E-Network services – ‘A New Horizon’: Twitter Facebook FICCI Blog Pinterest Ongoing services Slideshare offered by FICCI • Thought leadership initiatives • Channelising inputs for policy change • Connecting with 2,50,000 members from public and private sectors who FICCI represents directly and indirectly • Views of expert committees, forums and task forces covering 67 sectors of the economy • Events/Trade Fairs & Exhibitions to network and showcase members’ products and services • Capacity Building – towards enhancing competitiveness • Internationally acclaimed platforms to meet global political and business leaders • FICCI Business Digest, a monthly magazine covering major FICCI events and programmes • A Dedicated Members Helpline. Toll free No: 1800-11-3128 and email id: membershelpline@ficci.com34 || FICCI Business Digest || January 2013
    • Industry’s Voice for Policy ChangeWhat are the benefits & services offered by FICCI? How can I benefit from FICCI’s National & Global networks? How can FICCI help in expanding business outreach?How can FICCI assist in bridging information gaps? How can I be part of FICCI’s leadership initiatives? How could I participate in exhibitions & trade fairs? FICCITHESE & ANY OTHER QUERIES ANSWERED BY members’ helplIne Your one point contact : Sudeshna Banerjee Deputy Director Toll Free: 1800-11-3128 membershelpline@ficci.com Federation House, 1 Tansen Marg New Delhi 110001
    • IN THE STATES L uvsanvandan Bold, Minister of Foreign Affairs, Government of Mongolia, was on an official stands in the world rankings when it comes to carrying out business for overseas companies. He also talked visit to India on the invitation of about laws in strategic sectors such Salman Khurshid, Indian Minister as mining, banking & financing and of External Affairs. On January 15, media & telecommunications. Indian 2013, the Minister commenced his companies can look at Mongolia visit from Mumbai, the heart of as a gateway for doing business in Indian economy and finance. emerging markets of East Asia such as Bold visited the Bombay Stock China and Russia. Exchange (BSE), the first exchange D Delgersaikhan, Director General, to be established in Asia in 1875, to International Economic Department, discuss issues on bilateral financial Bank of Mongolia, made a prese- matters, stock market and exchanged ntation on macroeconomic outlook views with BSE’s CEO Ashish Kumar. of Mongolia, and highlighted the The Minister met Indian business opportunities in capital markets and representatives while visiting government bonds. FICCI’s office in Mumbai and he Dilip Dandekar, Consul General discussed his plans to developing of Mongolia, pressed upon the need bilateral cooperation and investment for identifying suitable opportunities environments between both the for Indian companies in Mongolia countries. He also stressed upon and explores new growth avenues in L to R: Luvsanvandan Bold, Minister of Foreign Affairs, Government of Mongolia; starting direct flights between India Mongolia. Dilip D Dandekar, Consul General of and Mongolia and establishment of The meeting was attended by Mongolia and Member, FICCI - Executive more visa facilitation centers. representatives from over 30 Committee; D Delgersaikhan, Director C Bayaraa, Ambassador Extra- companies and entrepreneurs such General, International Economic ordinary and Plenipotentiary, as ACC, Waree Engineering, IL&FS, Department, Bank of Mongolia; C Bayaraa Ambassador Extraordinary and Embassy of Mongolia, made a prese- Solar Unlimited (India) Pvt. Ltd., Plenipotentiary, Embassy of Mongolia and ntation on foreign investment trends Beautiful Planet, Dynamic Logistics Piya Singh, Director, FICCI-WRC. in Mongolia and where the country and Hinduja Group. Mongolia, a gateway to East Asia for Indian companies 36 || FICCI Business Digest || January 2013
    • IN THE STATESPromoting Odisha as an attractive investment destinationO n the behest of Industrial Promotion and InvestmentCorporation of Odisha Ltd (IPICOL), vogue and expectation mapping were other aspects put to test. G Mathi Vathanan, CMD, IPICOL, L to R: P K Jena, Commissioner-cum- Secretary, Department of Energy, Government of Odisha; C J Venugopal, Principal Secretary, Public Enterprisethe nodal agency of Government of through a presentation highlighted Department, Government of Odisha andOdisha for investment promotion the key aspects of doing business G Mathi Vathanan, CMD, Industrialand investment facilitation, FICCI’s in Odisha. It included the intrinsic Promotion and Investment Corporation ofOdisha State Council held a session advantages the state possesses with Odisha Ltd.with the leading electrical equipment respect to promoting manufacturingmanufacturers in Bhubaneswar on sector, success achieved so far,January 21, 2013. IPICOL desires endorsement of the investmentFICCI to organise a series of climate by leading captains of thededicated sessions with the leading industry and opportunities Odishaindustry players across sectors for can offer to the electrical equipmentbetter promotion of the state as an manufactures.attractive investment destination. P K Jena, Commissioner-cum- The session was attended by Secretary, Department of Energy, to establish quality service centersmore than 60 CEOs and Senior Government of Odisha, cited facts to cater to the existing industryManagement Personnel of the leading and figures about the massive and citied a grim example of howelectrical equipment manufacturers investment plans of the government the industry is suffering due to theand IPICOL was joined by the to strengthen the transmission and absence of service facilities in theDepartment of Energy, Government distribution network not only to state resulting in forced shut downof Odisha, its associated bodies, address on an urgent basis the extreme of plants. According to him, as thisthe Public Enterprise Department, loss levels in the sector but also to put segment of the industry does notGovernment of Odisha. in place an evacuation system that need large tracks of land and has a The prime objective was to better can efficiently transfer huge amounts low gestation period, manufacturerstarget the investment promotion of power to be generated in days to interested to come to Odisha will notefforts of the state government and come in Odisha. face any difficulties.evaluate the effectiveness of such C J Venugopal, Principal Secretary, Similar sessions with machine tools,efforts in creating right perception Public Enterprise Department, food processing, IT/ITeS, technicalabout Odisha among the larger Government of Odisha, urged the textiles, process plants equipmentinvestor community. Feedback participants to locate some of their manufacturers, steel and aluminiumgathering about the investment manufacturing facilities in the state. downstream industries are plannedfacilitation framework currently in He pointed out the pressing need for the future. January 2013 || FICCI Business Digest || 37
    • IN THE STATES ‘B engal Leads 2013’, an exhibition- cum-business summit, was organised by the West Bengal Ujjal Biswas, Minister of Technical Education & Training Department, Government of West Bengal, was the Training Department to revamp the TVET system in the state. Ranjan Choudhury, Principal – Government in Haldia from January Chief Guest at the session. Programme Development, National 15 to 17, 2013, to showcase the state as Speaking on the status of technical Skill Development Corporation a favourable investment destination education and training in the state (NSDC), mentioned the role of NSDC to the prospective investors. On the Anil Verma, Secretary, Technical to scale up the efforts necessary to occasion, FICCI West Bengal State Education & Training Department, achieve the objective of skilling 500 Council organised a session on Government of West Bengal, said million by 2022 in the country. A ‘Reaping the Skill Dividend in West that the focus areas were instituti- district-wise, sector-specific skills Bengal’ on January 16, 2013. onalisation of vocational education, gap study of West Bengal will be West Bengal, the fourth most improve in quality and strengthening launched soon. populous state in the country, has the linkages with industry. West Shourie Chatterjee, VP, IL&FS 43 per cent of its population in the Bengal was one of the first states Education & Technology Services age group of 15-39 years. Thus, a chosen for the pilot project for Ltd; Kalyan Kar, MD, Infinity huge chunk of potential workforce NVEQF (National Vocational Educ- Knowledge Ventures Pvt. Ltd. and needs to be effectively trained and Wation Qualification Framework) in Rahul Dasgupta, Director, Globsyn suitably placed for accomplishing Class IX and X and 93 schools have Skills Development Ltd., shared their the goal of inclusive growth. A large been approved by MHRD. experiences in skilling the youth pool of skilled workers is critical Vivek Kumar, Secretary, Higher population in the state. for attracting investments into the Education Department, Government More than 20 private training state. As West Bengal gears up to of West Bengal, highlighted the recent providers including Future Lear- reposition as an industrial leader, it is private university act to provide ning, ICA Infotech, Sriram New imperative to look at ways to reap its a stable policy and institutional Horizons, NHSM Knowledge ‘skill dividend’. framework to encourage private Campus, Technable Solutions, Future The session on skill development investment in the state and therefore Hope India, Orion Edutech, IQST, brought together policymakers, from the investors’ perspective Enterprise Development Institute, industry and private training providers West Bengal is an attractive market Bandhan and India Skills, were a part on the same platform to deliberate for investing in institutions and of the FICCI delegation to the Bengal on the needs for various forms of universities. Leads Summit. PPPs and effective convergence of Dr. Sangeeta Goyal, Senior Econ- different skill development efforts of omist, The World Bank, presented a the government and private sector to snapshot of reform strategy, which ensure skilling at all levels of the ‘skill is being developed by The World pyramid’. Bank with the Technical Education & Bengal needs to reap its ‘skill dividend’ to become industrial leader L to R: Ranjan Choudhury, Principal - Programme Development, National Skill Development Corporation; Dr. Sangeeta Goyal, Senior Economist, The World Bank; Vivek Kumar, Secretary, Higher Education Department, Government of West Bengal; Ujjal Biswas, Minister of Technical Education and Training, Government of West Bengal; Anil Verma, Secretary, Technical Education & Training Department, Government of West Bengal; Kalyan Kar, MD, Infinity Knowledge Ventures Pvt. Ltd.; Rahul Dasgupta, Director, Globsyn Skills Development Ltd and Shourie Chatterjee, VP, IL&FS Education & Technology Services Ltd. 38 || FICCI Business Digest || January 2013
    • Key macro economic indicators Nov Dec Jan Feb Mar Apr May June July Aug Sept Oct Nov 2011 2011 2012 2012 2012 2012 2012 2012 2012 2012 2012 2012 2012 Index of industrial production (YoY %) Industry 6.0 2.7 1.0 4.3 -2.8 -1.3 2.5 -2.0 -0.1 2.0 -0.7 8.3 -0.1 Mining -3.5 -3.3 -2.1 2.3 -1.1 -2.8 -0.7 -1.1 -3.5 -0.3 2.3 0.0 -5.5 Manufacturing 6.6 2.8 1.1 4.1 -3.6 -1.8 2.6 -3.2 0.0 2.4 -1.5 9.8 0.3 Electricity 14.6 9.1 3.2 8.0 2.7 4.6 5.9 8.8 2.8 1.9 3.9 5.5 2.4 Industrial growth as per use-based classification (YoY %) Basic goods 6.5 5.5 1.9 7.6 1.1 1.9 4.4 3.6 1.0 3.0 2.8 4.1 1.7 Intermediate goods 1.3 -1.5 -2.5 1.0 0.0 -1.8 3.4 0.9 -1.2 2.7 1.8 9.4 -1.1 Capital goods -4.7 -16.0 -2.7 10.5 -20.1 -21.5 -8.6 -27.7 -5.8 -4.4 -12.9 7.5 -7.7 Consumer goods- Durables 12.8 10.1 2.5 -0.4 1.1 5.4 9.7 9.1 0.8 1.0 -1.7 16.9 1.9 Growth of core infrastructure industries (YoY %) Overall Index 7.8 4.95 0.7 6.94 2.2 3.1 4.0 3.8 1.2 2.4 5.0 6.6 1.8 Coal 4.9 5.6 7.5 17.8 6.8 3.8 8.0 7.2 2.1 11.0 21.4 10.9 -4.4 Crude Oil -5.6 -5.6 -2.0 0.3 -2.9 -1.4 0.5 -0.8 -0.7 -0.6 -1.7 -0.4 0.8 Natural Gas -10.1 -10.8 -10.4 -7.6 -10.1 -11.3 -10.8 -11.1 -13.5 -13.5 -14.8 -14.9 -15.2 Refinery Products 11.2 0.8 -4.6 6.2 1.6 0.6 2.9 6.1 3.6 8.4 10.3 20.3 6.6 Fertilizers -6.7 0.8 4.0 4.1 1.5 -9.3 -15.1 -11.7 -2.2 -2.1 5.7 2.0 5.0 Steel 10.5 10.2 -2.8 4.7 2.3 6.8 4.9 -0.5 0.8 1.8 2.0 5.9 6.0 Cement 17.0 13.6 10.9 9.8 7.1 8.7 11.4 10.1 3.2 0.4 13.8 6.8 -0.2 Electricity 14.4 8.9 3.2 8.6 2.8 5.4 5.9 8.8 2.7 1.9 3.9 5.6 2.3 Monetary indicators (YoY %) Money supply (M3) 15.2 15.6 14.4 13.5 13.0 13.0 13.3 13.2 13.5 13.7 13.4 13.1* 12.5 Aggregate deposits 18.0 16.9 15.7 14.3 17.4 13.3 14.4 13.4 13.8 14.7 13.8 13.4* 12.8 Total bank credit 17.6 15.9 16.4 15.6 19.3 17.6 17.8 16.5 17.2 16.9 15.7 16.0* 17.0 Non-food credit 17.3 15.7 16.8 15.3 16.8 16.8 16.7 18.6 16.5 17.5 15.5 17.9* 17.8 Inflation (YoY %) WPI 9.46 7.74 7.23 7.56 7.69 7.50 7.55 7.58 7.52 7.55 7.81 7.45 7.24 Primary products 8.90 3.59 2.76 7.07 10.41 9.55 10.31 9.75 10.54 11.23 9.22 7.81 9.42 Fuel group 15.48 14.98 16.99 15.11 12.82 12.10 11.53 12.07 8.39 8.74 12.00 11.65 10.02 Manufactured products 8.17 7.64 6.71 5.82 5.16 5.27 5.24 5.37 5.87 6.36 6.47 5.95 5.41 CPI (IW) 9.3 6.5 5.3 7.6 8.6 10.2 10.2 10.1 9.8 10.3 9.1 9.6 9.55 External sector indicators Exports ($ mn) 23269.71 25365.69 25346 24618 28681 24455 25681 25067 22443 22300 23698 23247 22299.63 Imports ($ mn) 39102.48 40044.06 40107 39781 42587 37941 41947 35371 37936 38000 41778 44208 41586.90 Oil imports ($ mn) 12436.6 11678.7 12325 12660 15831 13909 14987 12229.1 13810 12840 14094 14785 14522.1  Non-oil imports ($ mn) 26665.9 28365.4 27782 27121 26756 24032 26959 25707.1  26777 24571 27685 29423 27064.8 Trade balance ($ mn) -13600 -14678.37 -14761 -15163 -13906 -13486 -16265 -10303 -15493 -15622 -18080.3 20961 -19287.3 Gross inflows / Investments ($ mn) 3423 2238 2,997 3204 2621 2947 2413 2214 2,388 3,856 5,117 3279 2395 FII ($ mn) 76 2302 5392 9228 -552 -1306 12 -412 2148 1566 4190 2937 2026 External sector indicators (YoY %) Exports* 3.8 6.7 10.1 4.2 -5.7 3.23 -4.16 -5.4 -14.8 -9.7 -10.90 -1.63 -4.17 Imports* 24.5 19.8 20.2 20.6 24.2 3.83 -7.36 -13.5 -7.6 -5.08 5.06 7.37 6.35 Exchange rate and Forex reserves Re / Dollar 50.84 52.66 51.35 49.16 50.32 51.80 54.47 56.03 55.47 55.55 54.60 53.02 54.68 Re / Euro 68.90 69.31 66.21 65.09 66.52 68.16 69.70 70.30 68.24 68.87 70.12 68.75 70.15 Re/ 100 Yen 65.62 67.66 66.78 62.74 61.04 63.81 68.33 70.67 70.23 70.68 69.90 67.23 67.60 Forex reserves ($ billion) 307.8 296.6 292.7 295.9 294.3 294.8 286.0 289.7 288.7 290.4 294.8 295.29 294.50Sources – Central Statistical Organization, Ministry of Commerce and Industry, Ministry of Finance, Reserve Bank of India, ^as on December 28, 2012,*as on October 26, 2012 *based on Provisional numbers, some numbers have been rounded to one decimal place 40 || FICCI Business Digest || January 2013