by admin | May 25, 2021 | Business, Corporate, Corporate Governance, Economy, Emerging Businesses, Investing, Markets, News, Politics
Ranchi : Jharkhand Chief Minister Raghubar Das on Friday laid foundation stone for 151 companies at the fourth groundbreaking ceremony of “Momentum Jharkhand” in Deoghar. These companies will invest Rs 2,700 crore in the state.
Speaking after laying the foundation stone in Deoghar of Jharkhand, the Chief Minister said: “Jharkhand will become a developed state of the country by 2020-2021. In the next 10 years, it will be developed at par with the developed countries.”
The state government had taken several steps to end poverty and generate jobs, he said. The condition of Jharkhand had changed in the last two years as businesses were now investing in the state, he added.
“Prime Minister Narendra Modi will visit Jharkhand on May 24 or 25. Rs 50,000 crore will be invested in the state the day Prime Minister will be here,” he said.
Das said that the Prime Minister would lay the foundation stones for Sindri factory, Adanai ultra power plant in Godda, and for a plastic park and AIIMS in Deoghar.
A number of state ministers, Lok Sabha MPs and legislators were present at the foundation stone laying ceremony.
On Wednesday, Mines and Industries Secretary Sunil Barnawal had said that the Friday’s investment of Rs 2,700-crore investment would create nearly 10,000 direct and 25,000 indirect jobs in the state.
Through Momentum Jharkhand, Rs 8,800 crore had already been invested in the state, which would create around 60,000 direct and 1.75 lakh indirect jobs, he said.
Jharkhand had organised “Momentum Jharkhand: Global Investors’ Summit” in February 2017. The state had received investment proposals worth over Rs 3-lakh crore during the summit.
—IANS
by admin | May 25, 2021 | Investing, Opinions
Representational image (Credit: ET)
By Taponeel Mukherjee,
Author H. Jackson Brown Jr once remarked: “Opportunity dances with those already on the dance floor.” For global investors and businesses, India in the 21st century is that very dance floor — but we must hasten to add that the investment opportunities here come with a unique set of challenges.
Creating a business out of an opportunity that appears attractive at the macro level may be beset with challenges at a micro-level. Essentially, the country’s large market size in any sector presents a compelling investment opportunity, and yet the average return available per user may challenge the viability of the business model.
With rising incomes, immense growth opportunities will emerge in the coming decades across telecom, aviation and other such infrastructure sectors. The consumption of goods and services is expected to rise to levels approximating those of more developed markets such as China and the US.
Take, as examples, the case of optical fibre cable and airline seats per capita. The optical fibre cable (much needed for 5G technology deployment) kilometres per capita in India is currently at 0.09 vis-a-vis China’s 0.87 (as per CRU). In 2014, the annual airline domestic seats per capita in India stood at 0.08 vis-a-vis 2.59 in the US (as per the Centre for Asia Pacific Aviation, or CAPA).
Bridging of the gaps in these infrastructure sectors is the opportunity investors must set their eyes on. Despite the low airline domestic seats per capita, CAPA maintains that, in terms of tickets sold, India is the third-largest and fastest-growing domestic aviation market in the world. This gives one an idea of the business opportunity. With the expected increases in incomes in the foreseeable future, these opportunities will only become more attractive.
Despite a large aggregate market size, the lower per capita income in India leads to a low revenue per user. This phenomenon poses a challenge for prospective businesses. Vodafone presents an interesting case in this regard. In fiscal 2016-17, of its total global subscriber base of 341.7 million, 209 million were in India (about 61 per cent). Yet, revenue earned here was 6.16 billion euros, or just 12.9 percent of its total global revenue of 47.6 billion euros.
In a business such as telecom that requires significant capital expenditure, a low average revenue per user is a real challenge. The fact that the large subscriber base can deliver value in the future as the average revenue per user grows cannot compensate for the fact that sustaining businesses in the short to medium term can be confounding.
This apparent paradox of an attractive business from a macro perspective beset with challenges at the micro level, is not unique to just the telecom sector in India. This is a challenge that businesses in general face in a country that has a large aggregate economy, but low per capita income.
The key to success for business in India is determined by the ability of an investor to circumvent the divide between an opportunity at a macro level and the ground-level challenges. Strategies to succeed should revolve around both sides of the balance sheet. From an asset perspective, businesses need to potentially bundle services and products so that customers are willing to give the company a larger share of their wallet.
For example, for a telecom business this could mean offering connectivity and entertainment as a package, a trend that is currently emerging. A second strategy could be to acquire the assets of or merge one’s assets with another similar company to create economies of scale, a strategy Vodafone has adopted.
On the liability side of the balance sheet, businesses can innovate through prudent capital structure management to generate access to relatively inexpensive debt. Global interest rates are still at historic lows despite the recent rate hikes in the US. The global financial investor base is awash with liquidity and hence willing to provide high quality businesses attractive borrowing terms. A high-quality company in India can create a moat around its business by borrowing for the long term at relatively low interest rates and reap long-run benefits.
India does present a unique set of opportunities and challenges for global investors and businesses. That said, it is a major economy and in the years to come is projected to have one of the highest growth rates globally. One estimate is that the India’s will be the third-largest economy globally by 2050. A global business searching for growth will need to have significant market presence in India. We would advise patience and a differentiated strategy for success.
(Taponeel Mukherjee heads Development Tracks, an infrastructure advisory firm. Views expressed are personal. He can be contacted at taponeel.mukherjee@development-tracks.com or @Taponeel on Twitter)
—IANS
by admin | May 25, 2021 | Business, Corporate, Corporate Buzz, Corporate Governance, Emerging Businesses, Employment, Investing, News, Politics
New Delhi : The new UK-India Tech Partnership agreed to during the bilateral meeting between visiting Indian Prime Minister Narendra Modi and his British counterpart Theresa May will help generate significant investment and create jobs, the British High Commission here said.
“An ambitious new UK-India Tech Partnership is expected to generate significant investment and support the creation of thousands of new jobs across the UK,” the High Commission said in a statement.
It said under the Partnership, Britain will establish a new UK-India Tech Partnership to identify and pair businesses, venture capital, universities and others to provide access routes to markets for British and Indian entrepreneurs and small and medium enterprises.
“It follows on from the success of the UK-Israel Tech Hub which has generated £62 million worth of deals over the past five years, with a potential impact of 600 million pounds for the UK economy,” it stated.
“The most up-to-date figures show the UK exported 358 million pounds of digital services to India in 2015.”
According to the statement, based on these figures, the success of the UK-Israel Tech Hub and the size of the Indian economy, Britain believes this initiative could give its economy a significant boost.
It said the UK-India Tech Partnership is expected to contribute to an increase of thousands of tech jobs in the UK in the coming years.
“Our world-leading digital economy is booming, worth more than 116 billion pounds a year and employing more than two million people,” British Digital Secretary Matt Hancock said in the statement.
“We’re determined to see this incredible success continue, and this ambitious UK-India Tech Partnership will bring together some of the best minds working in tech to unlock its future potential and deliver high-skilled jobs and economic growth in both countries.”
According to the High Commission statement, Britain will initially invest 1 million pounds to pilot the approach and potentially up to a further 13 million pounds by 2022.
“To build the network the government will engage in-country experts to work with the British High Commission in New Delhi, the Indian government and the private sector in order to increase tech investment, exports and research and development,” it said
It also said that smaller regional teams will link specific cities and regions in India and Britain.
“The Partnership will encourage innovation and productivity by helping businesses in the UK and India collaborate on emerging technologies, develop mentoring relationships and exchange staff,” the statement said.
“The regional teams will also ensure the impact is felt across the breadth of both nations’ expansive tech sectors, and that successful approaches adopted in one region can be shared and adopted in others.”
Initially the pilot will connect Britain with Pune in Maharashtra, focussing on the Future of Mobility, including low emission and autonomous vehicles, battery storage and vehicle light-weighting. Additional connections will be linked to Bengaluru with a focus on augmented and virtual reality, advanced materials and artificial intelligence.
If it is as successful as expected, the Partnership can be scaled up to bring in more regions of Britain and India which share expertise in the relevant fields.
In parallel, Britain and India’s tech trade associations TechUK and Nasscom will work together through a new UK-India Tech Alliance, bringing senior tech leaders together to collaborate, help develop policy and encourage innovation, according to the statement.
“This is an incredibly important partnership and something tech businesses from both countries have been driving for. The UK and India are leaders in the development and use of digital tech, and there is a huge amount we can learn from each other and big opportunities to join forces in innovation,” Julian David, CEO of techUK, said in the statement
“This is an incredibly important partnership and something tech businesses from both countries have been driving for. The UK and India are leaders in the development and use of digital tech, and there is a huge amount we can learn from each other and big opportunities to join forces in innovation,” David said.
“India is also a key strategic partner for the UK with world-class digital skills. Deepening our engagement will open up opportunities for business in both countries and help ensure we maximise the benefits of technology for our societies and citizens.”
—IANS
by admin | May 25, 2021 | Business, Business Summit, Events, Investing, Medium Enterprise, SMEs
India-Britain
New Delhi : Trade, investment, technology and flow of people and ideas will be high on the agenda when Prime Minister Narendra Modi visits Britain next week, British High Commissioner to India Dominic Asquith said here on Friday.
Modi and his British counterpart, Theresa May, are scheduled to hold a bilateral summit on April 18.
Briefing the media here ahead of the visit, Asquith said it comes at a time when the bilateral relationship is in “very, very good healthy”.
This is the third exchange of prime ministerial visits after Modi’s visit to Britain November 2015 and May’s visit to India in November 2016, her first outside the European Union after assuming office.
“It (Modi’s visit) comes at a time also when I think our priorities are very well aligned,” Asquith said.
Stating that trade between the two countries increased by 15 per cent in the last one year, he said that it is “remarkably balanced” in terms of trade in goods and services.
In terms of finance, he said the London Stock Exchange is playing an increasingly important role as a place to raise money to meet India’s huge infrastructure requirements.
“Over the last two years, 5.3 billion pounds has been raised by Indian issuers on the London Stock Exchange,” the High Commissioner said.
In terms of investments, he said that while Britain is the largest investor in India among the G20 countries, India is the fourth largest investor in Britain.
“Then what will be very much a focal point is the technology partnership between the two countries,” Asquith said. “The complementaries, strengths that each of us has and they are truly complementary.”
Modi’s visit to Britain this time has been themed “Living bridge and tech partnership”.
Asquith said that both sides will look into putting more resources in this sector in areas like digital aspect of technology, collaboration, artificial intelligence, advanced manufacturing, and data protection and the fintech that goes with that among others.
He said that matching of regional expertise in Britain with that of the states of India is another aspect of the bilateral relationship.
Stating that defence is another area of cooperation, he said that Britain was one of our four countries whose defence minister attended the ongoing DefExpo, India’s premier defence trade exhibition, near Chennai.
Regarding the “living bridge” part of the theme, Asquith said that it is about exchange of people, ideas and ingenuity both ways.
Stating that it goes much beyond the fact that there are 1.5 million people of Indian origin in Britain, he said it is about relationships between institutions, universities, and research bodies.
The High Commissioner also said that there was a 30 per cent rise in the number of student visas issued by his country to Indians last year.
Stating that 14,000 Indian students go to Britain for masters degree programme every year, he said that “we want to build on that”.
At the same time, he expressed the hope that one particular issue that should be looked into is the fact that Indian universities do not recognise the one-year masters degree offered by British universities for doing Ph.D.
Asquith also said that Britain issues more work visas to Indians than all other nationalities combined.
Regarding this year’s Commonwealth Heads of Government Meeting (CHOGM) which Modi will attend in London on April 19-20, the High Commissioner said that around 50 heads of state and government will be present.
The agenda, he said, will include climate change, vulnerability of small island nations, peacekeeping and helping poorer countries.
As for trade between the 53 Commonwealth countries, he said that the idea is to increase from the current $700 billion to $1 trillion.
Asked what will be the Commonwealth’s position on terrorism, Asquith said: “I imagine that one of the focus areas will be to discuss and I hope come up with an agreement on how to ensure that terrorists do not make use of the internet.”
—IANS
by admin | May 25, 2021 | Investing, Opinions
By Taponeel Mukherjee,
As large institutional investors with operational capacities plough money into Indian infrastructure, it is important that we also keep an eye on attracting the relatively small, non-operating investors as well. Mobilising capital from a variety of sources will be important for India to bridge the infrastructure gap.
Institutional entities investing in infrastructure broadly fall into two categories: One, large institutional investors with significant operational capacity and, two, relatively smaller investors with available capital but not the operational capacity or mandate.
For example, a large investor might be willing to not just invest in a wind farm but also have the capacity to run the business. A smaller player may be interested in being a financial investor, but without the capacity or mandate to operate the asset.
To attract both types of investors, the government must create a policy and investment climate that is conducive for infrastructure investments.
According to a global survey by Preqin among institutional investors in the “Preqin Investor Outlook: Alternative Assets H1 2017”, the current and target allocations to infrastructure for those surveyed was on average at 3.9 per cent and 5.2 per cent of assets under management, respectively. About 63 per cent of investors surveyed were below their target allocation to infrastructure.
Global institutions, it seems, are under-invested in infrastructure, a clear opportunity for India to attract global capital. The country needs to create a regulatory environment that can attract a significant portion of the additional capital that will flow into infrastructure, especially from the relatively smaller investors.
Another interesting statistic: There has been a significant increase in direct infrastructure investments (as a percentage of the total pool of investable capital) by institutional investors over the last five years, but the proportion of investors doing direct investments has decreased.
The important takeaway is that though larger operating investors have increased their investments, a significant number of smaller investors have capital that they need to allocate through non-direct route which does not involve an operating role with respect to managing the asset. For operational or other reasons, these relatively smaller investors prefer non-direct investments with direct investing being done by large investors with significant in-house operational capacity.
In the survey by Preqin, 62 percent of investors had assets less than $10 billion under management. It is imperative that policymakers look at how this pool of capital can be mobilised and used to build infrastructure.
The next question is: Just how big is the pool of capital available globally beyond the very large investors? A ranking by Investment & Pensions Europe (IPE) released in September-October 2017 and ranked the largest global institutional investors in infrastructure threw up some interesting statistics.
While the top 10 investors had approximately $170 billion allocated to infrastructure, they had approximately $3.9 trillion under management. The investors from the 20th to the 60th positions in the ranking had $95 billion allocated to infrastructure while total assets under management was approximately $3.8 trillion.
What this shows is the significant capital pool that the relatively smaller investors have — and the challenges that exist in attracting that pool of capital due to fragmentation.
In a global economy with asset price volatility and shrinking central bank balance sheets, attracting global capital will be more challenging than usual. India, given the size of its population, a young demographic and obvious infrastructure investment opportunities, is an investment destination on investors’ minds, but we need to make sure that we build on our strengths.
Large, operationally-savvy investors are extremely important, but so are the non-operating financial investors. A stable and efficient regulatory environment, along with efficient investment vehicles, will be the key to attract more global capital for Indian infrastructure.
(Taponeel Mukherjee heads Development Tracks, an infrastructure advisory firm. Views expressed are personal. He can be contacted at taponeel.mukherjee@development-tracks.com or @Taponeel on Twitter)
—IANS
