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  • -why yet another STORY-this story begins in 1947 – the brits leave-my 28 year story and the changes in india-india through my eyes-we’ve proven that god exists

    1. 1. INDIA<br />Redefining progress<br />
    2. 2. Did You know that India.......<br /><ul><li>Is the largest democracy in the world
    3. 3. Has one of the most ancient civilizations, with a history of scientific enquiry.
    4. 4. Has never invaded another country ,yet the 3rd largest armed country, and even a nuclear weapon power.
    5. 5. Is world’s 4th largest economy
    6. 6. Has 29 states; 325 languages; 1652 dialects and many civilisations.
    7. 7. Has 2nd largest pool of technical manpower in the world.
    8. 8. Produces 50,000 doctors, 350,000 engineers and 800,000 MBAs every year.</li></li></ul><li>India…a unique, very complex story <br />In India,<br />an Italian lady born a Catholic (Sonia Gandhi)<br />stepped aside so a Sikh (Manmohan Singh) <br />could be sworn in as Prime Minister by a Muslim President (Abdul Kalam)<br />to lead a nation that’s 82% Hindu<br />Can you cite another country with such diversity and tolerance?? <br />
    9. 9. Even though the world hasjust discovered it, the Indiagrowth story is not new<br />It has been going on for 25 years<br />
    10. 10. What is the India story? <br />
    11. 11. 28 years of high growth<br />Average annual GDP growth<br />(%)<br />(%)<br />10<br />8.9<br />8<br />6.0<br />6<br />3.5<br />4<br />1.0<br />2<br />0<br />1900-1950<br />1950-1980<br />1980-2002<br />2002-2007<br />
    12. 12. Literacy is rising<br />(%)<br />100<br />80<br />80<br />65<br />52<br />60<br />40<br />17<br />20<br />0<br />1950<br />1990<br />2000<br />2010 P<br />Source: Census of India (2001)<br />
    13. 13. (m)<br />0<br />The rise of a strong middle class makes it a consumption driven economy<br />32%<br />22%<br />8%<br />400<br />368<br />300<br />200<br />220<br />100<br />65<br />2010 <br />1980<br />2000<br />Source: The Consuming Class, National Council of Applied Economic Research, 2002 <br />
    14. 14. India is now the 4th largest economy<br />It will overtake Japan between 2012 and 2014 to become the 3rd largest<br />
    15. 15. The India model is unique <br />
    16. 16. Drivers of growth<br />India<br />Domestic<br />Services<br />Consumption<br />High tech, capital intensive industry<br />East and S.E. Asia <br />Exports <br />Manufacturing <br />Investment <br />Low tech, labour intensive industry<br />
    17. 17. Implications of India model <br />‘Domestically led’ means:<br />Insulation from global downturns<br />Less volatility<br />Coming out of the global crisis <br /> faster<br />
    18. 18. 33%<br />59%<br />42%<br />64%<br />India<br />India<br />China<br />China<br />41%<br />U.S.<br />Europe<br />58%<br />45%<br />Brazil<br />Implication of India model – Consumption led<br />People Friendly:Consumption as % of GDP<br />People Friendly, Less inequality: Gini Index<br />Will India become the next big consuming economy after the U.S.?<br />
    19. 19. India’s success is market-led whereas China’s is state induced<br />The entrepreneur is at thecentre of the Indian model<br />
    20. 20. India has a vibrant private space <br />100 Indian Companies have market cap of US$ 1bn <br />1,000 Indian Companies have received foreign institutional investment<br />125 Fortune 500 companies have R&D bases in India<br />390 Fortune 500 companies have outsourced software development to India<br />2% bad loans in Indian banks (v~20% in China)<br />80% credit goes to private sector (v~10% in China)<br />
    21. 21. Understanding India’s economic success<br />Mental revolution among the young<br />“I want to be Bilgay” <br />“Banianisation” of society<br />300+ TV channels; 65 news channels<br />The rise of Hinglish<br />
    22. 22. “By 2010 India will have world’s largest number of English speakers”“When 300 million Indians speak a word in a certain way, that will be the way to speak it.”<br />Professor David CrystalCambridge Encyclopedia of the English Language<br />
    23. 23. Key government reforms<br />Opened economy to trade and investment<br />Dismantled controls <br />Lowered tariffs<br />Dropped tax rates<br />Broke public sector monopolies <br />
    24. 24. Where the government infrastructure fails…..<br />….. Innovation kicks in <br />
    25. 25. Business in 21st century India<br />Yet Another Point Of View<br />
    26. 26. First …the bad news<br /><ul><li>Inadequate infrastructure
    27. 27. roads
    28. 28. ports and airports
    29. 29. power
    30. 30. Labour productivity issues
    31. 31. Some archaic laws -eg. Land ,labour
    32. 32. Socialist hangovers –or posturings
    33. 33. Intermittent fundamentalism issues</li></li></ul><li>…..and some good news<br /><ul><li>Secular tolerance-2nd largest Muslim population
    34. 34. Stable and sharp economic growth
    35. 35. Well established banking and a judicial system
    36. 36. Very young population-that means hands ,and demand
    37. 37. Developing into a consumption economy
    38. 38. Changing bureaucracy
    39. 39. Declining trade unionism
    40. 40. Federal and unitary amalgam</li></li></ul><li>Why was it this way….<br /><ul><li>The Hindu DNA-acceptance and karma
    41. 41. A few hundred years of subjugation
    42. 42. And then by politicos
    43. 43. Erosion of self esteem
    44. 44. Complex governance issues</li></li></ul><li>And what has changed……..<br /><ul><li>Intellect-the main Indian export
    45. 45. Abundance of knowledge resources- and creation of the arbitrage opportunity
    46. 46. Global acceptance of the Indian mind
    47. 47. Some visible successes overseas-software , steel , automobiles
    48. 48. Indian acquisition of overseas companies</li></ul>A WORLD OF OPPORTUNITY OPENS UP<br />
    49. 49. 1991 and onwards<br /><ul><li>Economic Scenario
    50. 50. Liberalized Trade Regime – opening up of India
    51. 51. Huge Investment inflows
    52. 52. Merging with the world economy
    53. 53. Political Scenario
    54. 54. Liberal Capitalist Regime- but at gunpoint
    55. 55. Psychographic profile
    56. 56. Literacy 50-85%
    57. 57. Technology exposed-and absorbing fast
    58. 58. Demographics-A very young nation- and getting younger
    59. 59. Cultural
    60. 60. Guiltless Consumers
    61. 61. Pragmatic </li></li></ul><li>What does all this mean for us<br />Implications on Global Managers<br />Implications on Companies to do business in India – or from India<br />
    62. 62. <ul><li>India gets richer
    63. 63. Goes beyond the big cities
    64. 64. The creamy layer gets richer and thicker
    65. 65. Serious structural shifts happening in the Indian consumer market
    66. 66. Shift away from a supply-constrained economy to a demand-driven one
    67. 67. The Indian consumer's mindset is dramatically changing
    68. 68. Austerity is no longer considered a virtue --and debt no longer taboo
    69. 69. “Yehdil mange more” ---the Pepsi generation is here</li></ul>Consumer India #1<br />
    70. 70. Consumer India: The Good News<br />Mn HH<br />Mn HH<br />4<br />15<br />High<br />UM<br />5<br />13<br />M<br />10<br />15<br />LM<br />16<br />14<br />L<br />12<br />2<br />NCAER<br />From a pyramid to a cylinder - The Richer are getting richer and the poor are getting richer. Finally - the ability will match aspiration.<br />
    71. 71. The rise of rural demand<br /><ul><li>Rural India accounts for 74 per cent of India's population and 58 per cent of its disposable income
    72. 72. Breaking into this market requires innovative thinking and a new strategy</li></ul>THE BIG QUESTION …. “HOW TO DRILL THIS ROCK”<br />Consumer India #2<br />
    73. 73. Mn HH<br />Mn HH<br />3<br />8<br />High<br />UM<br />4<br />8<br />M<br />11<br />25<br />38<br />64<br />LM<br />L<br />63<br />34<br />Growth in rural income<br />NCAER<br />
    74. 74. The Rural - Urban Divide<br /><ul><li>Is it a strength or a weakness
    75. 75. Opportunity certainly exists
    76. 76. Creation of many market/product Life-cycles
    77. 77. Similar aspirations (C & W penetration/telecom explosion)……BUT
    78. 78. Very dissimilar purchasing power</li></ul>An opportunity………………… in disguise<br />Consumer India #3<br />
    79. 79. The changing low income consumer<br />From<br /><ul><li>Settle for less
    80. 80. Intimidated by technology
    81. 81. Feudal
    82. 82. Reacting and avoiding
    83. 83. Self denial
    84. 84. DESTINY DRIVEN</li></ul>To <br /><ul><li>Stretch for more
    85. 85. Curious about technology
    86. 86. Not overawed by power
    87. 87. Experience seeking
    88. 88. Affordable indulgence
    89. 89. DESTINATION SEEKING</li></li></ul><li><ul><li>India –THE NEW OPPORTUNITY?
    90. 90. Burgeoning middle class – as large as the entire population of the US
    91. 91. Market deprived of international goods and services
    92. 92. “Pundits” said that it was a market ready for all the global brands </li></ul>Consumer India # 4<br />But was it? … Will it be??<br />
    93. 93. <ul><li>Not one Market-very heterogenous
    94. 94. Tyranny of averages
    95. 95. Market within markets
    96. 96. Speciality local markets
    97. 97. Very demanding consumer emerging
    98. 98. An amalgam culture happening emerging -new languages and metaphors </li></ul>DELIGHT OF MARKETING PROFESSORS…..AND MARKET SEGMENTERS<br />….And the bane of marketers<br />“Whatever you say about India, the opposite is also true”<br />Consumer India #5<br />
    99. 99. So what’s happening in India now?Some case stories<br />
    100. 100. Long Haulers<br /><ul><li>Unilever (HLL)
    101. 101. BAT (ITC)
    102. 102. Suzuki Motor / Maruti</li></ul>Later Starters<br /><ul><li>Hyundai Motor
    103. 103. LG
    104. 104. Samsung
    105. 105. GE</li></ul>Glocalisation Is All Very Well<br />But these are the true road warriors<br />Some Success Stories<br />
    106. 106. Made for India Strategy<br />And “Made in India’<br />Multi-pronged strategy to tackle diversity of customer base<br />Leverage world R&D capability for “Value right” products<br />Provided solutions for a highly<br />aspiring low income market<br />Manage the logistics to address market<br />spread <br />Success in India …what made it happen?<br />
    107. 107. <ul><li>General Motors
    108. 108. Ford
    109. 109. Kellogg
    110. 110. Pepsi
    111. 111. Coke
    112. 112. Enron
    113. 113. Electrolux
    114. 114. Whirlpool
    115. 115. Reebok/Nike/Adidas</li></ul>…….. and the list goes on.<br />“Failures”<br />
    116. 116. Replicating Global Strategy<br />Unified global Strategy replicated in India<br />Tastes for India – Not kept in mind<br />Indian Values and Attitudes<br />‘Non- value right’ products<br />Failures in India… why ?<br />
    117. 117. An amazing opportunity to Fail….. <br />Or Succeed<br /><ul><li>Long haul market, ‘hang in there’
    118. 118. Not for the faint-hearted
    119. 119. Under-investing as bad as over-investing
    120. 120. Demands strategy complexity –folks and strokes</li></ul>What India means today-Rx<br />
    121. 121. What India means today-Rx<br /><ul><li>Build costs in tandem with revenues
    122. 122. Needs international fundamental questions-not solutions
    123. 123. Exist on Earth and Mars concurrently in terms of market and technology practices</li></ul>An amazing opportunity to Fail….. <br />Or Succeed<br />
    124. 124. INCOME<br />ASPIRATION<br />IDEOLOGY<br />Fertile Ground for Market Development<br />THE INDIA SOLUTION<br />
    125. 125. Not just a market – also a supplier<br />Software professionals-but that’s current history<br />BPO extended <br /><ul><li>Food , yes food
    126. 126. Medicare
    127. 127. Biotech
    128. 128. Research</li></ul>Automotive <br /><ul><li>Components
    129. 129. Two wheelers
    130. 130. Cars, yes cars
    131. 131. Components</li></ul>and the list goes on…..<br />7th largest in the world <br /><ul><li>Home to 40 million passenger vehicles
    132. 132. Almost 4 million vehicles produced in 2010</li></li></ul><li>India at 64<br />As a nation, India has never followed the plot. Just when the world is ready to buy into myth of modernity, it finds itself harking back to medievalism. It is a narrative that defies even the most ardent storyteller, an idea that can never be encapsulated by mere numbers. Specially in India, torture numbers and they’ll confess anything.<br />It is a country in the throes of change, its greatness sometimes diminished by figures, at other times enhanced by them. But as the nation turns 64 a midnight’s child ready for a new beginning, the facts and figures also show us where we stand in the community of nations – a country not afraid to confront, and surmount, its worst truths. <br />…ANON..<br />
    133. 133.
    134. 134. India …….a lesson in humility<br />Dhanyavaad<br />