How Can Connectivity Support Innovation? - Prof Fukunari Kimura
Indo-Myanmar-China-Bangladesh-ICWA-5DECEMBER
1. KEC International Limited
BMIC Corridor-Hope and Hard Work
Pankaj Tandon
KEC International Ltd
18 Nov 2013 1KEC International Limited
2. 2KEC International Limited
KEC – An Indian Multinational Infrastructure EPC Major
MULTI-LOCATONAL
MANUFACTURING
8 Manufacturing facilities spread
across 3 countries
Manufactures Towers, Cables,
Poles and Hardware
EPC MAJOR
1.3 billion dollar enterprise
Executing 100+ projects
Over 6 decades of experience
GLOBAL PRESENCE
Spread across 5 continents
Footprints in 50 Countries
Currently projects in 30 countries
60% sales from outside India
GLOBAL WORKFORCE
5,000+ employees
30 Countries
23% non Indians
20 nationalities
BUSINESS PORTFOLIO
Interest in 7 businesses
Global leader in Power
Transmission EPC
SALES & ORDER BOOK SIZE
Rs 7,000 cr. (US 1.2bn) sales
Rs 10,200 cr. (US 1.7bn)
order book
Doubled sales in last 4 years
3. KEC International Limited
Business Portfolio
Power
Transmission
Power
Systems
Cables WaterTelecom Renewable
•EPC Contractor
•Tower
manufacturing
•Pole
manufacturing
•Hardware
•Sub-stations
•Cabling,
EBoP
•Distribution
network
•Power Cables:
LT/HT/EHV
•Telecom
Cables: Optic
fiber & Jelly
filled
•Tower
manufacturing
•EPC
Contractor
•OPGW
stringing
•Civil, track
laying
tunnels,
bridges
•Electrification
•Signaling
•Solar
• Wind
•West water
treatment
•Water
resource
management
Railways
Interest in 7 businesses: Basic needs for economic development of any country
3
4. 4
EPC Expertise and Reputation
Successfully executed
projects in all kinds of
difficult terrains and
hostile climatic
conditions
Simultaneously handled
multiple large size
projects across
geographies
Transmission Project
Oman
USD 110mn
Dec 2012
Tower Supply Project
Canada
USD 125 mn
Nov 2010
Substation Project
Kazakhstan
USD 157 mn
Dec 2010
Deserts
UAE, Libya
Mountains
Saudi, India, UAE
Seas/Rivers
UAE, Egypt, Nigeria
Snowfields
Algeria, Kazakh, India
-40
o
to +50
o
Kazakh, UAE
Dust Storms
Our store in Middle East
Gorges
Afghanistan
Dense Forests
Kenya, India
Expertise in managing
cross country projects
across globe spanning
the length of more than
10000km simultaneously
KEC International Limited
6. Myanmar- The Golden Opportunity Land
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1223
1354
63.7
150
Population 2012 in Mn: The Economist
Strategically Located between two
Asian Giants India & China
>100000 MW Hydro Power Potential
92 Potential Large Hydro Power Plants
Proven Gas Reserves of 11.8 Trillion cft
7. Myanmar-Trade-A snapshot
47%
16%
13%
6%
18%
Thailand China India Japan Others
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23%
39%
3%
13%
22%
Thailand China India singapore Other
Myanmar Export Distribution Myanmar Import Distribution
India’s share not significant
8. Is Connectivity fueling Trade?
4.55
1.55 1.26
0.58
1.74
Thailand China India Japan Others
Export (Total $ 9.69 bn 2012*)
Export Volumes
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3.56
6.03
2.01
0.46
3.40
Thailand China Singpore India Other
Import Volumes
Import (Total $ 15.46 bn 2012)
77
38
34
21
9
8
7
7 6 3
Flights per week (Indian High Commission-Yangon)
Thailand Singapore China Malaysia Taiwan Vietnam India Qatar Korea Japan
Connectivity is Integral to
Trade & Business
Relations
9. KEC International Limited
18 Nov 2013 9KEC International Limited
Item Description India Bangladesh Myanmar China Thailand
GDP (USD)
1.758 Trillion (2013
Est)
140.175 Bn
(2013 Est)
59.42 Bn (2013
est)
8.939 Trillion
(2013 est)
365.6 bn (2012)
GDP Per capita(USD) 1414 933 915 6569 5474
Ease of Doing Business
(WB 2013)
134/189 130/189 182/189 96/189 18/189
Ranking on corruption
perception
94/175 136/175 157/175 80/175 (2013) 102/175
Population (in Mn) 1222
150
(Mar-13 Est)
54
(2011 Est)
1350 (2012
Est)
65.92 (2010
Census)
Population Density (per
km2) /Rank
World Av:53
390(31/243)
(India Population
Clock)
1034 (12/243)
(Official est July 12)
79 (123/243)
UN July 2013
Estimate
141(43/243)
Official est (Dec
2012)
128 (89/243)
(2010 Census)
Ranking by Population 2 8 24 1 20
Power Generation
236 GW (as on
31.03.2012)
10.2 GW (Nov-13) 3.37 GW 874 GW
19.78 GW
(2012)
Median Age 26.6 (2010 est) 23.8 (2010 Est) 27.1(2010 est) 35.8(2010 est) 34.7(2010 Est)
Power Consumption
(kWH/year)-2011 Est
World Bank data
684 259 110 3298 2316
HDI (2013 Report UNDP) 136 146 149 101 103
Key Indicators: Challenges? Opportunities!
10. Key Indicators: Challenges? Opportunities!
Item Description India Bangladesh Myanmar China Thailand
Tele Density 70% 70% <10% 44%
Internet Penetration
% /Rank
12.6%
(164/212)
6.3%
(181/212)
1.1%
(209/212)
42.3%
(102/212)
26.5%
(132/212)
Literacy Primary
education
(Age 15 and above
who can read and
Write )
74%
(Age 7 & Above
who can read and
write 2011 Census)
78.8% (2012 Est)
CIA World Fact Book
89.9% (CIA World Fact
Book 2006 Est)
95.1% (2010
Est) CIA World
Fact Book
92.6% (2000
Census)
English Speaking (%
of Population)
10.35%
18%
(Euro Monitor
International Report
2009)
<1% 0.83%
27% (Crystal
-2003)
Un Employment Rate 9.9% (2013 July) 5% (2009) 4.9% (2009) 4.1 (2010)
0.56% (2013
Jan)
People Below
Poverty Line
29.8% (2010)
Word Bank Report
Nov 2012
26% (2010)
Word Bank Report Nov
2012
29.8% (2013 Est)
Ministry of Information
& Technology,
Myanmar
13.4%(2011)
CIA, World Fact
Book (July
2012)
8.1% (2009
est)
Motor Vehicle Per
1000
(excl Two Wheeler)
18(2009) 3(2010) 7 (2010) 85 (2012) 210 (2012)
Road Kms/1000
Person
2 Kms Per 1000
Persons /Against 11
Km of SEA Average
Urban Population 31.3% (2011) 28.4% (2011) 32.6% (2011) 50.6%(2011) 34.1%(2011)
KEC International Limited 10
11. Opportunity Myanmar: A dipstick
• Access to Electricity<30%
• Total Installed capacity (MEPE-July 2013) : 3896 MW
– Local Consumption-3375 MW
– For Export to Neighboring Countries-522 MW
• Hydro Power Potential>100000 MW
– 92 Potential Hydro Power Plant
– 36 at various stages of Implementation
• China-31
• Thailand -3
• India-2
• Transmission Line upto 500 kV – 4513 Kms (in next five years)
• Substation Potential (6698 MVA in Next Five Years)
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“Multiplier effect once economy moves with new investments and urbanisation”
12. Geographical advantage
KEC International Limited 12
Myanmar may be a good channel to
connect South East Asia & SAARC
Opportunity for Sino-India Ventures in a
neutral territory
4 States (Manipur-Mizoram-Nagaland-
Arunachal Pradesh) share 1643 Kms of
Border with Myanmar
The North-East population equal to 60%
of Thailand population can be developed
as a market for Indian products from
Myanmar
Common infrastructure facilities like
Power Plants to cater to greater regional
population with lesser damage to
environment
Manufacturing bases, Health Facilities in
Myanmar to cater to North East
Education, Skill development, Centre of
Excellence and Tourism can be developed
on a regional basis
Arunachal
Pradesh
Mizoram
Manipur
Nagaland
13. Challenges
• Laws & Guidelines on Taxation/Banking/Investments/Company affairs
are under evolution
– Indian Banks still hesitant to support Myanmar Investment
• Limited Global Exposure
– Maturity of clients on International Contracts
• Bidding is on negotiation basis
• Poor IT & Communication Infrastructure
– IT & ITeS ( Teledensity<10% & Internet Penetration<1%)
• Concerns on the future of newly experienced democratic journey
– Consistency of policies and reforms post 2015
• Anxiety on regional peace and stability
– Business pre-requisite of social stability in the region beyond Yangon
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14. Challenges-On Ground Experience
• Indian LOC facing issue of India/Foreign Component
– 70% Indian/30% Outside India Vs 50% Indian/50% Outside India [MOEP]
• Paucity of Skilled Workers/Qualified Contractors
– OPGW Hotline Stringing
– Conductor Stringing
– Local knowledge limited to upto 230 kV
• Tower erection
• Conductor & OPGW Stringing
• Limited Local Manufacturing Capacity
– Telecom expansion-(Potential of more than 10000 Towers/90000 MT in next 2-4
years )
– Local manufacturing Capacity-12000 MT/annum
• Institution Building and International Contracts enforcement
– In house projects by Controlled departments and limited exposure to open
International Contracts
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15. Few steps :
• Faster Realization of Indian LOC Funded Project
• India-Myanmar Hydro Power Development
– Similar to Bhutan Model
– Shall help build North East India as well
• ICT is huge Opportunity
- Special Concession for Investment in Myanmar
• Connectivity-Ease of VISA, Travel and educational opportunities for creeping engagement
• Ventures with South East Asian and Chinese Companies for wider engagement
• Standardization and harmonization for smoother trade in products across border
• Indo-Bangladesh-Myanmar Road/Rail/Power Corridor
• ADB/WB funding
– Institutionalization
– Best Practices
– Un Biased Procurement
– International Contract Capability
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16. Data/Information Source
• http://en.wikipedia.org/
• http://articles.economictimes.indiatimes.com/2013-10-02/news/42617389_1_foreign-investment-total-trade-volume-china
• Presentation by Mr. U. Maung Maung Chief Engineer (PTP) on “Power System Development Scheme of MEPE”
• www.wordbank.prg
• data.worldbank.org/indicators
• www.adb.org
• https://www.cia.gov/library/publications/the-world-factbook/fields/2212.html
• RIS Report on Expansion of North East India’s Trade and Investment with Bangladesh & Myanmar”
• http://www.eia.gov/countries/country-data.cfm?fips=BM
• stats.uis.unesco.org
• www.tradingeconomics .com
• www.egat.co.th/en
• http://www.doingbusiness.org/rankings
• http://cpi.transparency.org/cpi2013/results/
• ADB Report on Myanmar Energy Sector Initial Assessment-Oct 12
• www.pwc.com/mm
• PWC Report on Myanmar Business Guide November 2013
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