Mumbai: The government proposes some more relaxations for the branded garments sector, besides enhancement of duty abatement from 40 per cent to 55 per cent.
One of the major relaxations proposed for the sector is exemption to job workers who work for brand owners in India. This category may not be required to pay 10 per cent excise duty, which the government imposed on branded garments in the Union Budget 2011-12.
Second, branded school and corporate uniforms and materials may also be exempted from excise duty. “This means any branded uniform or blankets, quilts, etc for schools, colleges, hotels, airlines or for any other industry is likely to be exempted from payment of excise duty,” explained an official source.
Third, documentation and procedures for availing exemption from excise duty for small-scale industries may be simplified. Sources said excise officials might not inspect documents. Rather, mere certification from a chartered accountant or documents submitted for value added tax (VAT) and VAT credit would be sufficient to claim excise exemption.
The finance ministry had imposed 10 per cent excise duty on branded garments in the last Budget but later decided to enhance the cut-off limit of industries for excise payment. This was done by increasing the turnover limit eligible for seeking exemption by allowing duty abatement from 40 per cent to 55 per cent but only for 2011-12. With this relief, a unit would be eligible for SSI exemption in 2011-12 even if it had a turnover based on retail sale of Rs 8.9 crore in 2010-11.
Besides excise duty imposition, the sector, however, received a slew of benefits, from reduction of custom duty on various chemicals used for manufacturing of synthetic textile to reduction of excise duty on textile machinery. Also, basic customs duty on raw silk of all grades had been cut from 30 per cent to five per cent and specific tariff rate of 10 per cent had been prescribed for jute yarn, while it was exempted from excise duty. Textile items have been exempt from additional duties of excise under the Goods of Special Importance Act, 1957.
For raw silk , the ministry has also reduced the basic custom duty from 30 per cent to five per cent ad valorem, for augmenting domestic availability for weavers, both in the handloom and the power loom segments.
In raw silk, the government is also keeping a close watch on import volumes and domestic prices, to take steps in mitigating any adverse impact on the domestic sericulture sector.
Success in my Habit
Tuesday, May 31, 2011
ISRO to launch French satellite in 2012
Kolkata/ Bhubaneswar: Continuing its programme of commercial launch of foreign satellites, Indian Space Research Organisation (ISRO) has lined up launch of an image capturing satellite of France next year, according to Parivakkam Subramaniam Veeraraghavan, director, Vikram Sarabhai Space Centre (VSSC), a unit of ISRO.
“Because of our cost effective technology, many developed nations, including France and the US are willing to launch their satellites with our system. Many smaller and mini satellite launching programmes on commercial basis are in offing,” Veeraraghavan said while attending the National Technology Day seminar organised by National Aluminum Company (Nalco) here yesterday.
The French satellite SPOT (Satellite Pour l'observation de la Terre) is a high-resolution, optical imaging, earth observation satellite system. Currently SPOT 5 is working in the space and is expected to be withdrawn by the end of 2013. India will launch the SPOT 6 satellite, which will provide continuous high definition images of earth.
Due to the cost effectiveness of India-made PSLV (Polar Satellite Launch Vehicle) and GSLV (Geosynchronous Satellite Launch Vehicles), many countries prefer India to launch their satellites. Recently ISRO successfully placed Singapore's first experimental satellite in space. India has so far launched 27 foreign satellites and 60 India-made satellites.
Currently, it costs $25,000 per kg to launch a satellite. The satellites can weigh 500 to 5,000 kg. Sometimes mini-satellites weighing 15-20 kg are bundled with the rocket and are placed in desired orbits.
However, profit realisation from satellite launch is currently lower because of high cost of fuel and one-time use of the rockets. Veeraraghvan said, ISRO is working on a project to develop reusable satellite launcher.
“The reusable spacecraft would minimise the launching cost by 90 percent. We have set 2030 as deadline to reach this goal,” he said.
In next five years, ISRO has plans to launch one ASTROSAT, which is a low cost version of Hubble Telescope, one GPS navigation satellite and a special satellite that can provide Internet services, informed the VSSC director.
“Because of our cost effective technology, many developed nations, including France and the US are willing to launch their satellites with our system. Many smaller and mini satellite launching programmes on commercial basis are in offing,” Veeraraghavan said while attending the National Technology Day seminar organised by National Aluminum Company (Nalco) here yesterday.
The French satellite SPOT (Satellite Pour l'observation de la Terre) is a high-resolution, optical imaging, earth observation satellite system. Currently SPOT 5 is working in the space and is expected to be withdrawn by the end of 2013. India will launch the SPOT 6 satellite, which will provide continuous high definition images of earth.
Due to the cost effectiveness of India-made PSLV (Polar Satellite Launch Vehicle) and GSLV (Geosynchronous Satellite Launch Vehicles), many countries prefer India to launch their satellites. Recently ISRO successfully placed Singapore's first experimental satellite in space. India has so far launched 27 foreign satellites and 60 India-made satellites.
Currently, it costs $25,000 per kg to launch a satellite. The satellites can weigh 500 to 5,000 kg. Sometimes mini-satellites weighing 15-20 kg are bundled with the rocket and are placed in desired orbits.
However, profit realisation from satellite launch is currently lower because of high cost of fuel and one-time use of the rockets. Veeraraghvan said, ISRO is working on a project to develop reusable satellite launcher.
“The reusable spacecraft would minimise the launching cost by 90 percent. We have set 2030 as deadline to reach this goal,” he said.
In next five years, ISRO has plans to launch one ASTROSAT, which is a low cost version of Hubble Telescope, one GPS navigation satellite and a special satellite that can provide Internet services, informed the VSSC director.
Industrial output registers 7.3 per cent growth in March 2011
New Delhi: India’s industrial output has risen sharply, registering an impressive 7.3 per cent growth in March 2011. The figures show that the Indian economy is keeping up the growth momentum of previous years.
The factory output, as measured by the Index of Industrial Production (IIP), rose 7.3 per cent in March 2011, as compared to the corresponding period a year earlier. The IIP almost doubled the revised 3.7 per cent expansion registered in February 2011. The increase in the factory output signals a strong overall consumer demand.
The new IIP numbers, with 2004-05 as the base year, will start coming from the next month. The current base year is 1993-94.
Exports rose 34 per cent to record US$ 23.9 billion in April 2011, while imports were up 14.1 per cent to US$ 32.8 billion. Among others, passenger cars sales grew at 13.2 per cent in April 2011. In addition, the output of consumer durables expanded 12.3 per cent while that of non-durables rose 5.5 per cent.
The factory output, as measured by the Index of Industrial Production (IIP), rose 7.3 per cent in March 2011, as compared to the corresponding period a year earlier. The IIP almost doubled the revised 3.7 per cent expansion registered in February 2011. The increase in the factory output signals a strong overall consumer demand.
The new IIP numbers, with 2004-05 as the base year, will start coming from the next month. The current base year is 1993-94.
Exports rose 34 per cent to record US$ 23.9 billion in April 2011, while imports were up 14.1 per cent to US$ 32.8 billion. Among others, passenger cars sales grew at 13.2 per cent in April 2011. In addition, the output of consumer durables expanded 12.3 per cent while that of non-durables rose 5.5 per cent.
New rules exempt M&As before June 1
New Delhi: New regime less harsh than the draft guidelines, has a host of exemptions.
Companies fearing a more difficult merger and acquisition (M&A) regime heaved a sigh of relief with the Competition Commission of India (CCI) on Wednesday notifying rules that are less harsh than the draft guidelines. The rules also provide a host of exemptions.
M&As announced before June 1 will be exempted, even if the deal has not been implemented. This means M&A activities in public domain, like the $9.6-billion Cairn-Vedanta deal, will not be scrutinised by CCI.
The filing fee has been slashed from Rs 40 lakh to Rs 50,000 for most cases. Companies will have to pay Rs 10 lakh only in exceptional cases. In the draft rules, the fee was Rs 10-40 lakh depending on the deal value. Acquisitions by venture capital funds and financial institutions will not attract the fee.
“We have taken care of all the concerns of industry. It represents the collective wisdom of all stakeholders, achieved through a unique process of consultation and transparency,” said CCI Chairman Dhanendra Kumar.
The rules allay the fears of industry by mentioning 10 broad criteria for categorising routine business transactions that will be exempted from the filing requirement.
A merger outside India with insignificant impact on local competition or business is one such instance. Acquisition of stock-in-trade, raw materials and assets has also been exempted. This is besides investment in the ordinary course of business, bonus issues, stock splits, etc.
Corporate law firms welcomed the regulations, though they were cautious on certain fronts.
“There continue to be a few issues which we hope will be ironed out in the days to come, including omission of the provision allowing pre-merger consultations and the somewhat vague exemption given to international transactions with no ‘significant nexus’ with or effect on the Indian market. It is unclear how significant the nexus will have to be for a global merger which otherwise meets the thresholds,” said Samir Gandhi of Economic Laws Practice.
“Industry may still have some concerns over the powers of CCI to review acquisitions where control is not being acquired and the notifying party or transaction is subject to a possible 210-day review. The focus will now turn to the actual functioning of the commission and how it will scrutinise the qualifying transactions,” said Pallavi S. Shroff, a competition law expert and senior partner at Amarchand Mangaldas.
Indian companies that need to notify M&As include those with assets of Rs 1,500 crore or a turnover of Rs 4,500 crore. In case of foreign entities, the trigger was assets of $750 million or a turnover of $2,250 million, with assets worth Rs 750 crore or a turnover of Rs 2,250 crore in India, said Manoj Kumar, partner of law firm Hammurabi and Solomon.
Even though the Competition Act was enacted in 2003 and CCI started functioning in a full-fledged manner in 2009, M&As remained out of its purview as specific provisions under the law that deals with M&As were not notified by the government until March this year.
Companies fearing a more difficult merger and acquisition (M&A) regime heaved a sigh of relief with the Competition Commission of India (CCI) on Wednesday notifying rules that are less harsh than the draft guidelines. The rules also provide a host of exemptions.
M&As announced before June 1 will be exempted, even if the deal has not been implemented. This means M&A activities in public domain, like the $9.6-billion Cairn-Vedanta deal, will not be scrutinised by CCI.
The filing fee has been slashed from Rs 40 lakh to Rs 50,000 for most cases. Companies will have to pay Rs 10 lakh only in exceptional cases. In the draft rules, the fee was Rs 10-40 lakh depending on the deal value. Acquisitions by venture capital funds and financial institutions will not attract the fee.
“We have taken care of all the concerns of industry. It represents the collective wisdom of all stakeholders, achieved through a unique process of consultation and transparency,” said CCI Chairman Dhanendra Kumar.
The rules allay the fears of industry by mentioning 10 broad criteria for categorising routine business transactions that will be exempted from the filing requirement.
A merger outside India with insignificant impact on local competition or business is one such instance. Acquisition of stock-in-trade, raw materials and assets has also been exempted. This is besides investment in the ordinary course of business, bonus issues, stock splits, etc.
Corporate law firms welcomed the regulations, though they were cautious on certain fronts.
“There continue to be a few issues which we hope will be ironed out in the days to come, including omission of the provision allowing pre-merger consultations and the somewhat vague exemption given to international transactions with no ‘significant nexus’ with or effect on the Indian market. It is unclear how significant the nexus will have to be for a global merger which otherwise meets the thresholds,” said Samir Gandhi of Economic Laws Practice.
“Industry may still have some concerns over the powers of CCI to review acquisitions where control is not being acquired and the notifying party or transaction is subject to a possible 210-day review. The focus will now turn to the actual functioning of the commission and how it will scrutinise the qualifying transactions,” said Pallavi S. Shroff, a competition law expert and senior partner at Amarchand Mangaldas.
Indian companies that need to notify M&As include those with assets of Rs 1,500 crore or a turnover of Rs 4,500 crore. In case of foreign entities, the trigger was assets of $750 million or a turnover of $2,250 million, with assets worth Rs 750 crore or a turnover of Rs 2,250 crore in India, said Manoj Kumar, partner of law firm Hammurabi and Solomon.
Even though the Competition Act was enacted in 2003 and CCI started functioning in a full-fledged manner in 2009, M&As remained out of its purview as specific provisions under the law that deals with M&As were not notified by the government until March this year.
Monday, May 2, 2011
GlaxoSmithKline Biologicals in talks to buy BE's vaccine division
Bangalore: GlaxoSmithKline Biologicals , a division of global drug giant Glaxo, is in talks with the Hyderabad-based Biological E Ltd (BE) to purchase its vaccines division , people familiar with the discussions said.
This division produces and markets a range of paediatric and adult vaccines and has a sizeable market share in the Indian vaccine market . Officials from Glaxo Biologicials, which is based in Belgium, recently visited the Indian firm's manufacturing facility in Shameerpet near Hyderabad, people close to the development said.
Biological E managing director Dr Vijay Kumar Datla did not respond to an emailed questionnaire on the issue. A Glaxo spokesperson in Mumbai declined to comment.
BE, which has already invested around Rs 350 crore for its facilities, has three key divisions, biologics, pharma and public markets. Biologics makes paediatric and adult vaccines, while public markets is in charge of distributing all kinds of vaccines to the state and central govt and public health services.
The talks are believed to be at a preliminary stage. The Biological E's website says that it was the first private sector company to enter the vaccines market. Diphtheria and tetanus vaccines are some of its key products and this has given BE a significant share of the Indian vaccine market. Its pharma division manufactures solid dosage forms, liquid orals, syrups and active pharmaceutical ingredients catering to both local and international markets.
A pharma analyst said Glaxo had recently faced some constraints in supplying vaccines to its markets around the world from its plant in Nashik, Maharashtra. It would be interested in buying out companies with modern manufacturing facilities approved by international agencies like US FDA, said the analyst, who did not wish to be quoted because he is not authorised by his firm to speak. He also added that GSK Biologicals is globally huge in paediatric vaccines and BE's expertise in that segment would offer excellent synergies in terms of a strategic fit.
Glaxo was also believed to be interested in Shantha Biotech which was eventually sold to French drugmaker Sanofi's vaccine division for $ 780 million in 2009.
The Belgium-headquartered GSK Biologicals is one of the world's leading vaccine manufacturers and employs more than 1,000 research scientists. As per a previous company statement, in India, the division leads the vaccine market in terms of market share and also exports vaccines to both developed and developing markets.
LED maker Lighting Science to foray into India by September
New Delhi: US-based LED manufacturer Lighting Science Group, a global leader in its business, plans to enter the Indian market by September with an eye to grab 20% share of the market over three years.
The company is in advanced talks with three to four domestic LED manufacturers to float an Indian joint venture (JV), industry sources said. Lighting Science Group will hold a majority stake in the joint venture to be named Lighting Science India. The company plans leveraging existing retail network and manufacturing lines of its Indian partner.
Lighting Science Group managing director (India) Arun Narayan told ET that the current Indian market is estimated at $40 million (about 180 crore) and is likely to grow to $400 million (Rs 1,800 crore) by 2014. The company, managed by $2 billion Pegasus Capital Advisors, has applied for Nasdaq listing.
"Lighting Science India targets 15-20% of the growing market," said Narayan. The Indian LED market is in a nascent stage with a few major players like Philips and Crompton Greaves . In India, LED bulbs are about 4-5 times costlier than incandescent bulbs and compact fluorescent lamps (CFLs). Lighting consumes about 20% of energy and LEDs can bring it down to 4%, said Narayan.
Australia , the United States and European Union have barred use of incandescent lamps. In order to encourage use of the energy efficient bulbs, the government in budget 2011-12 halved excise duty on LED bulbs to 5% while the special counter veiling duty of 4% was abolished.
Lighting Science Group expects to earn the majority of its revenues in India by supplying LEDs to local municipal authorities for street lighting. The company also targets to sell its product to industrial units. Retail sales of LEDs would begin in the next two years, Narayan said. The government has recently asked eight industries, including thermal power projects, fertiliser, cement, and iron & steel manufacturing units, to comply with energy efficiency norms. Units consuming more energy than designated would be penalised. It is expected that the nine sectors would have to invest about 30,000 crore over the next three years to comply with the norms.
Lighting Science Group would initiate talks with state governments, local authorities, real estate developers and industrial units for supply of products. The company has engaged Dixon as its first distributor and would form tie-ups with more regional distributors.
The company is in advanced talks with three to four domestic LED manufacturers to float an Indian joint venture (JV), industry sources said. Lighting Science Group will hold a majority stake in the joint venture to be named Lighting Science India. The company plans leveraging existing retail network and manufacturing lines of its Indian partner.
Lighting Science Group managing director (India) Arun Narayan told ET that the current Indian market is estimated at $40 million (about 180 crore) and is likely to grow to $400 million (Rs 1,800 crore) by 2014. The company, managed by $2 billion Pegasus Capital Advisors, has applied for Nasdaq listing.
"Lighting Science India targets 15-20% of the growing market," said Narayan. The Indian LED market is in a nascent stage with a few major players like Philips and Crompton Greaves . In India, LED bulbs are about 4-5 times costlier than incandescent bulbs and compact fluorescent lamps (CFLs). Lighting consumes about 20% of energy and LEDs can bring it down to 4%, said Narayan.
Australia , the United States and European Union have barred use of incandescent lamps. In order to encourage use of the energy efficient bulbs, the government in budget 2011-12 halved excise duty on LED bulbs to 5% while the special counter veiling duty of 4% was abolished.
Lighting Science Group expects to earn the majority of its revenues in India by supplying LEDs to local municipal authorities for street lighting. The company also targets to sell its product to industrial units. Retail sales of LEDs would begin in the next two years, Narayan said. The government has recently asked eight industries, including thermal power projects, fertiliser, cement, and iron & steel manufacturing units, to comply with energy efficiency norms. Units consuming more energy than designated would be penalised. It is expected that the nine sectors would have to invest about 30,000 crore over the next three years to comply with the norms.
Lighting Science Group would initiate talks with state governments, local authorities, real estate developers and industrial units for supply of products. The company has engaged Dixon as its first distributor and would form tie-ups with more regional distributors.
Venus Remedies successfully completes Phase I & II clinical trials of cancer detection molecule
Chandigarh: Chandigarh-based Venus Remedies Limited has successfully completed Phase I and II clinical trial for VRP1620, a cancer detection molecule. The clinical study has shown excellent results in detection of breast cancer. With this drug, detection of breast cancer would be possible even with a simple X-ray using dye and the sensitivity of other detection devices such as coloured doppler, PET would be increased several times.
On the occasion Manu Chaudhary, Research Director of the company told, “VRP 1620 (Tumatrek) is a unique and cost effective diagnostic tool for cancer which can also detect malignancy even through X-ray. It can detect cancer at lesser cost and at primary stage itself.” By detection of cancer at early stage it can increase the cure rate. Scientists believe that after Phase III trials of this product VRP-1620 may also help in locating proliferation of cancer site.
GVFL in talks with global PE firms
Mumbai/Ahmedabad: With the Gujarat Venture Finance Limited (GVFL) receiving first tranche of Rs 200 crore from the state government, the venture capital (VC) firm is now aiming to raise around Rs 500 crore of its Rs 1000-crore infrastructure fund - Golden Gujarat Growth Fund Series-1 by June 30, 2011. What's more, GVFL is also in talks with domestic and international funding institutions like private equity companies, banks, insurance firms and pension funds to raise the remaining funds.
The first closure is expected by June 2011 with available funds of Rs 500 crore and the final closure will take place after a year, in June 2012. However, the company would start appraising project proposals and would start taking up due diligence of the infrastructure projects from May 2011 onwards.
"The first fund closure will take place by June this year. But simultaneously we will also start considering the prospective projects for investments. From May 2011 onwards we intend to initiate the process of due-diligence of the projects. We are hopeful to get funding commitments from the companies by then. Currently, the talks are on with domestic and international financial institutions," said H C Pattnaik, executive director, GVFL. So far GVFL has approached financial institutions like LIC of India, Asian Development Bank, SIDBI and a few international private equity firms.
Gujarat government will contribute 20 per cent of the total fund size, while anchor bank and anchor industry would contribute 10 per cent each for the fund. The remaining 60 per cent will be raised from domestic and international institutional investors. The state government has made a budgetary provision of Rs 200 crore for the fund in the annual budget 2011-12 presented in February.
State-promoted venture financing company, GVFL had announced the Rs 1000 crore infrastructure fund during the Vibrant Gujarat Global Investors' Summit 2011 held in January this year. The fund has been registered with Securities and Exchange Board of India (SEBI) and would invest in the companies from high-end small and medium enterprises segment to mid corporate firms having operations in infrastructure space and alternate energy including green and clean technology.
Some of the companies and investment bankers have already started approaching GVFL with investment proposals for projects development.
"We are receiving enquiries and investment proposals from investment banks and companies. But we have not identified any project so far. It will be decided after the due-diligence of the projects from May onwards," Pattnaik informed.
The seven year fund is expected to yield average internal rate of return (IRR) of around 20 per cent for the investors. The Gujarat government holds 56 per cent in GVFL through public sector units while HDFC holds 13.6 per cent. ICICI Group and other entities have around 20 per cent stakeholding in the company.
Cabinet nod to set up panel for two fab plants
New Delhi: The Union Cabinet on Wednesday approved setting up of an Empowered Committee to identify technology and investors for establishing two semiconductor wafer fabrication (fab) manufacturing facilities.
The decision is expected to have a significant impact in resolving issues in the capital-intensive electronics hardware sector and help the industry develop localised content. Investment for the two wafer fabs is estimated to be Rs 25,000 crore.
The committee comprises adviser to prime minister on public information, infrastructure and innovation; chairman of National Manufacturing Competitiveness Council; secretary, Department of Expenditure; member (industry), Planning Commission; M J Zarabi, former chairman and managing director, Semiconductor Complex Ltd; and secretary in Department of Information Technology. It may co-opt any other experts.
It will identify technology and potential investors for the establishment of semiconductor wafer fabs, and thereafter ascertain their interest in setting up of fab facilities in the country. It will assess and recommend the nature and quantum of government support like equity, grants, subsidies in physical and financial terms to set up the facilities. It will submit its recommendations by July 31.
The fabs are expected to have catalytic impact on development of downstream and upstream products, including ancillaries. It may have sizeable impact on the development of IT/ITeS sector. It will generate employment for 30 million people by 2020.
The decision is expected to have a significant impact in resolving issues in the capital-intensive electronics hardware sector and help the industry develop localised content. Investment for the two wafer fabs is estimated to be Rs 25,000 crore.
The committee comprises adviser to prime minister on public information, infrastructure and innovation; chairman of National Manufacturing Competitiveness Council; secretary, Department of Expenditure; member (industry), Planning Commission; M J Zarabi, former chairman and managing director, Semiconductor Complex Ltd; and secretary in Department of Information Technology. It may co-opt any other experts.
It will identify technology and potential investors for the establishment of semiconductor wafer fabs, and thereafter ascertain their interest in setting up of fab facilities in the country. It will assess and recommend the nature and quantum of government support like equity, grants, subsidies in physical and financial terms to set up the facilities. It will submit its recommendations by July 31.
The fabs are expected to have catalytic impact on development of downstream and upstream products, including ancillaries. It may have sizeable impact on the development of IT/ITeS sector. It will generate employment for 30 million people by 2020.
Nasscom sees strong spurt in tech demand
New Delhi: Technology industry body National Association of Software and Services Companies (Nasscom) sees a strong revival of demand that could not only help meet, but even exceed, growth expectations for 2011-12. Newly-appointed Nasscom chairman for 2011-12, Rajendra S Pawar said in an interaction with ET: "We are coming back to growth levels seen prior to the slowdown and in the near term we see lot of headroom to catapult this growth.''
When asked whether this means Nasscom will revise its 15-17 % growth target for the year for the $70 billion technology and business services sector, Pawar said, "it's too early to comment, but we are on track to exceed this target.'' Pawar, 60, co-founder and chairman of education software company, NIIT , took over as Nasscom chairman from Harsh Manglik. Nasscom also appointed N Chandrasekaran as vice-chairman of it's executive council. Chandrasekaran is CEO and MD of Tata Consultancy Services , the largest Indian technology services company.
As chairman of the executive council, Pawar will lead and assist Nasscom in catalysing the growth of the Indian IT-BPO industry and enabling the sfulfilment of its future goals and aspirations. Towards this end, Pawar wants to focus on two areas. First, how Nasscom will facilitate growth of the small and mid-sized companies. "There are a lot of SMEs focused on software products, telecom, internet space, all driven by intellectual property. By the end of this decade we see quite a few of them becoming very big,'' Pawar said. And second, 'IT for India', that is, how Nasscom can help in e-governance projects. "Government technology initiatives are beginning to get critical mass. We will engage with these projects and see what opportunity is available to companies,'' he added. Besides, Nasscom will push for private sector partnerships in e-governance projects.
On sops to industry, particularly for SMEs, Pawar said, "we will align with the new direct tax code. The new tax regime is supportive of growth and will help the industry.'' Pawar takes over at a time, when on the one hand the industry is coping with quality of talent issues and on the other, later in the year, could see a return of the anti-offshoring wave, as build up for the US elections starts. On strategies to cope with these Mr Pawar said "talent is a big issue and industry will have to accelerate shifts to new models (like de-link revenue and manpower growth) and focus on innovation. On anti-offshoring , we will be engaging a lot more with various stakeholders.''
When asked whether this means Nasscom will revise its 15-17 % growth target for the year for the $70 billion technology and business services sector, Pawar said, "it's too early to comment, but we are on track to exceed this target.'' Pawar, 60, co-founder and chairman of education software company, NIIT , took over as Nasscom chairman from Harsh Manglik. Nasscom also appointed N Chandrasekaran as vice-chairman of it's executive council. Chandrasekaran is CEO and MD of Tata Consultancy Services , the largest Indian technology services company.
As chairman of the executive council, Pawar will lead and assist Nasscom in catalysing the growth of the Indian IT-BPO industry and enabling the sfulfilment of its future goals and aspirations. Towards this end, Pawar wants to focus on two areas. First, how Nasscom will facilitate growth of the small and mid-sized companies. "There are a lot of SMEs focused on software products, telecom, internet space, all driven by intellectual property. By the end of this decade we see quite a few of them becoming very big,'' Pawar said. And second, 'IT for India', that is, how Nasscom can help in e-governance projects. "Government technology initiatives are beginning to get critical mass. We will engage with these projects and see what opportunity is available to companies,'' he added. Besides, Nasscom will push for private sector partnerships in e-governance projects.
On sops to industry, particularly for SMEs, Pawar said, "we will align with the new direct tax code. The new tax regime is supportive of growth and will help the industry.'' Pawar takes over at a time, when on the one hand the industry is coping with quality of talent issues and on the other, later in the year, could see a return of the anti-offshoring wave, as build up for the US elections starts. On strategies to cope with these Mr Pawar said "talent is a big issue and industry will have to accelerate shifts to new models (like de-link revenue and manpower growth) and focus on innovation. On anti-offshoring , we will be engaging a lot more with various stakeholders.''
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