Employment grew by 2.15 lakh in April-June

New Delhi: Overall employment grew by 2.15 lakh during the April-June 2011 quarter, with most sectors showing an increase except textiles, including apparels, and transport. “An upward trend in employment has been continuously observed since July 2009,” according to the Labour Bureau's quarterly quick estimates to assess the impact of the post-2008 economic slowdown on employment in the country. IT/BPO Sectors Lead The information technology and BPO sectors generated the maximum number of jobs at 1.64 lakh during June over March 2011, followed by 0.53 lakh in metals, 0.18 lakh in automobiles, 0.13 lakh in gems and jewellery, 0.01 lakh in leather and 0.01 lakh in handloom and powerloom sectors. “The maximum increase in overall employment by 1.90 lakh was seen in the direct category of workers as compared to 0.25 lakh in the contract category,” states a Ministry release. In export-oriented units, employment at the overall level rose by 0.67 lakh, while in non-exporting units, it increased by 1.48 lakh during June 2011 over March. However, compared with the last four quarterly surveys during 2010-11 (June 2011 over June 2010), overall employment increased by 10.31 lakh, with highest rise in IT/BPO (7 lakh) followed by 1.31 lakh in textiles, including apparels, 0.96 lakh in metals, 0.78 lakh in automobiles, 0.16 lakh in transport and 0.13 lakh in leather. The Labour Bureau surveyed 2,289 units and establishments spread across 11 States and Union Territories.

India IT spending will grow 9.1% next year: Gartner

Mumbai: Despite the global economic challenges, IT spending in India by enterprises will increase by 9.1 per cent in 2012, according to a report from research firm Gartner. IT spending in India is projected to total $79.8 billion in 2012, against $73.1 billion in 2011. And this is being attributed to the fast paced growth in India's burgeoning telecommunications space and the growing adoption of devices such as smart-phones and tablet computers, especially in tier-2 and tier-3 cities, a Gartner analyst said. “A lot of new IT infrastructure is being bought in tier-2 and tier-3 cities both in the enterprise and retail segments…moreover, the 2G spectrum scam has not had any sizeable impact on IT spending in the space,” he added. Largest segment The telecommunications market is the largest IT segment in India with IT spending forecast to reach $54.7 billion in 2012, followed by the IT services market with spending of $11.1 billion. The computing hardware market in India is projected to reach $10.7 billion in 2012, while software spending will total $3.2 billion, Gartner said. It may be recalled that the Telecom Regulatory Authority of India has pegged India's mobile teledensity at 72.12 per cent or 86.57 crore wireless subscribers as of August. According to Gartner, worldwide IT spending will reach nearly $3.7 trillion by current year end. Of this, emerging economies such as India, China, Brazil and others will account for $1.013 trillion. Speaking at the inaugural Gartner Symposium here in Mumbai, Mr Peter Sondergaard, Senior Vice-President at Gartner, said two-thirds of Chief Executive Officers surveyed by Gartner believe that IT's contribution to their industry in the next 10 years will be greater than in any prior decades. “IT is a primary driver of business growth. For example, this year 350 companies will each invest more than $1 billion in IT. They are doing this because IT impacts their business performance,” said Mr Sondergaard. Three ‘forces' Going forward, Gartner has identified three ‘forces', namely cloud computing, social media computing and information explosion that will change the way businesses will be conducted going forward. “The impact of these forces will make architectures of the last 20 years obsolete… Together, they force the issue – they drive us to create the post-modern business, drive simplicity and force creative destruction,” Mr Sondergaard said.

Footwear industry doubles to Rs 20,000 crore in 5 years as Indians go on a shopping spree

Bangalore/Kolkata: Madhu Malhotra could not believe her luck when she chanced upon a pink and white pair of heels that had an uncanny resemblance to her pinkembroidered white kurta at DB Mall in Bhopal last Thursday. The missionary school teacher also scooped up a pair of maroon flats that day to go with her jeans on weekends, increasing her shoe count to 35 pairs. "People have a tendency to buy only on Diwali, but I buy through the year," the 58-year-old giggles, having bought a pair of gladiator flats on a recent holiday to Mumbai. She is not an exception. Many Indian consumers now spend as much on footwear as on apparel and change their shoes for different occasions, helping expand footwear range from formals, casuals and home wear to weddings, monsoons, clubwear, sportswear, adventure, beachwear and lounge wear. They have also helped the footwear industry almost double in the past five years to an estimated Rs 20,000 crore and prompted retailers to widen their footprint with some urgency. Here is an industry where everybody is in a rush and nobody talks slowdown, which is being felt in most areas of the economy. Harkirat Singh, managing director of the Rs 600-crore Woodland, says the industry is not feeling any impact of slowdown due to a number of external triggers that include more women joining the workforce, an increasing desire to look good and rise in consumers' aspiration levels. "All these are pushing shoe retailing to newer heights," says Singh. Big retailers such as Bata, Liberty and Reliance Footprint are adding nearly two stores a week and opening large-format outlets in smaller cities. Footwear Shopping Has Increased The country's largest shoe retailer Bata India's group MD Rajeev Gopalakrishnan says increasing competition is forcing the companies to refresh their collection at a faster rate than before. Industry insiders say the frequency of footwear shopping has increased dramatically. While men buy a pair of shoes every quarter, women do it faster, every two months. "With fast-changing fashion, customers prefer to update shoes and accessories whenever they update their wardrobe with new apparel," says Kabir Lumba, MD of department store chain Lifestyle International, which has reported 50% year-onyear growth in the footwear segment since 2008. While women may labour over design, colour and heel sizes ranging from ballerina flats to kitten heels, wedges and stilettos, men sweat over anti-skid, biodegradable and waterproof materials. And a lot of customers are now more concerned about the looks than comfort and durability, says Jacob John, brand head of apparel brand Louis Philippe, which entered the footwear market last year. Footwear accounts for 10% of Louis Philippe's revenues. The fashion brand owned by Madura Fashion & Lifestyle recently opened a pure play men's footwear store in Pune. Anupam Bansal, MD of Liberty Retail Revolutions, says Indians now spend 8-10% of their income on footwear and accessories. Shailen Amin, CEO of multi-brand shoe portal Be Stylish, says young professionals crossing over from the unorganised segment to branded footwear are driving the growth. Luxury On Foot The organised footwear market is estimated at Rs 17,500-20,000 crore, growing at 10-15% a year, although top companies independently claim to be growing at 25-30%. The men's segment accounts for nearly 60% of the market, with leather products dominating. But women and children's segments are growing faster, making many retailers step into this market. Demand is growing in smaller cities such as Sangli, Dehradun, Bathinda and Patiala. The luxury segment too is growing rapidly. Luxury brand Jimmy Choo, popular for its Swarovski-encrusted heels retailing at over Rs 1 lakh, grew 30% year-onyear in 2010-11 and has opened five stores in the past three years. "Earlier, new, aspirational consumers entered the designer segment through handbags. But in many cases, shoes are becoming an entry point today," says Deepika Gehani, creative head of Genesis Luxury, which has brought Jimmy Choo to India. Anand Ramanathan, associate director at management consultancy KPMG, says that although it's driven by fashion trends, the footwear industry is comparatively less risky than the apparel business. "Not only is the ticket size of footwear much higher per sq ft but the exposure to market changes is also lower because the product does not expire as fast," he says. While Reliance Footprint and Liberty say sports and casual wear are the fastest growing, a loyal franchise for men's office wear brand Hush Puppies has prompted Bata to open 11 standalone outlets for the brand. Retailers are highly sensitive to regional preferences too. "If twoinch heels click in Kolkata, women in Bangalore prefer three-inch heels," says Rafique Malik, MD of Metro Shoes, which also owns the brand Mochi. "While vibrant colours must be stocked in Punjab, Tamil Nadu is the only market where white men's shoes sell through the year," he says.

Cabinet approves 51 per cent FDI in multi-brand retail

New Delhi: The Cabinet finally paved way for the entry of global retail majors like Wal-Mart, Tesco and Carrefour to open independent multi-brand retail outlets in India. The Cabinet has permitted foreign direct investment (FDI) of up to 51 per cent in multi-brand retail. Simultaneously, the Cabinet also gave the nod for raising the FDI limit in single-brand retail ventures to 100 per cent. The policy will allow multi-brand foreign retailers to open outlets only in cities which have a population of more than 1,000,000 as per the 2011 Census. At present, there are 55 such cities which would help big retail chains to move beyond the metros to smaller cities. The clearance comes with several conditions attached to it. Foreign investors will be required to invest up 50 per cent of total FDI in back-end infrastructure. Such infrastructure will include capital expenditure on all activities, excluding that on front-end units. Expenditure on land cost and rentals will not be counted for purpose of back-end infrastructure. Moreover, retailers will need to source at least 30 per cent of manufactured/processed products from small industries. However, there will not be any obligation on the part of retailers to source agricultural produce such as fruits and vegetables. The Government of India has also retained the first right on sourcing agricultural produce. It makes 30 per cent sourcing from small and medium enterprises mandatory, as soon as the FDI limit exceeds 51 per cent. Opening up of FDI in multi-brand retail trade and further liberalisation of single-brand retail trade, as per the Government, will facilitate greater FDI inflows besides additional and quality employment.

Commerce Ministry approves proposals for packaging sector

Hyderabad: The $23-billion Indian packaging industry is expected to get a significant boost, with the Ministry of Commerce and Industry giving an in-principle approval to take up the 10 proposals submitted by the Indian Institute of Packaging to enhance industry standards. The 10 proposals, entailing an investment of about Rs 60 crore, include setting up of food packaging laboratory, flexible intermediate bulk container testing laboratory at Chennai and an international packaging centre in Mumbai. The proposals will also involve construction of a new education complex in Mumbai for B.Tech course on packaging, besides establishment of new centres in Guwahati and Ahmedabad. “We have just given our (Ministry's) approval, which will be submitted to the Ministry of Finance to decide on funding patterns. All the proposals will be completed during the 12 {+t} {+h} Plan Period,” Mr J.K. Dadoo, Joint Secretary to the Ministry of Commerce and Industry, told media persons on the sidelines of the Indipack 2011 event here. The domestic packaging sector, which has registered a 15 per cent growth, is expected to grow at 18 per cent in the next few years to touch $40 billion by 2015. Currently, it accounts for 10 per cent of the global market, constituting nearly 400 billion containers in terms of unit volumes. India imports about $125 million worth packaging machinery from Germany, Italy, Korea and China, with some 600-700 machinery manufacturers operating locally. Mr Dadoo said food consumption in India was expected to touch $240 billion by 2013, necessitating innovative packaging solutions, especially in the area of “heat and eat” food products. India's per capita packaging consumption is less than $15, against the world average of $100, he added. On the wastage of perishable food items due to inadequate packaging and transportation, he said the proposal to allow 51 per cent FDI in multi-brand retailing may reduce this wastage, as the foreign retailers will largely depend on primary producers for farm produces. They are expected to bring in better packaging and supply chain solutions. The three-day Indipack, which includes technical conferences and an exhibition, was inaugurated by the AP Minister for Civil Supplies and Food, Mr Sridhar Babu.

Cabinet approves Companies Bill

New Delhi: Seven years after it was first proposed, the cabinet on Thursday approved the Companies Bill 2011, a draft law to comprehensively amend the 55-year-old Companies Act 1956. It will be tabled in Parliament during the current session. The Bill aims at the modernisation of corporate regulation. It will herald an era of e-governance, enhanced accountability, and corporate social responsibility (CSR) among companies registered in the country. Several corporate governance and disclosure norms were included in the Bill to avoid recurrence of corporate scandals such as the alleged accounting fraud by the promoters of the erstwhile Satyam Computer in 2009. Additional disclosure norms for companies, mandatory rotation of auditors and audit firms, regulation of related-party transactions, protection of minority shareholders, provision for class action suits, enhancement of penalties and a mandatory slot for a woman director on company boards are all new proposals included in the Bill. Among other things, it also proposes to tighten the laws for raising money from the public. The Bill seeks to prohibit insider trading by company directors or key managerial personnel by treating such activities as a criminal offence. Further, it has proposed companies earmark two per cent of the average profit of the preceding three years for CSR activities and make a disclosure to shareholders about the policy adopted in the process. Class action suits will empower investors to sue a company for oppression and mismanagement, and claim damages. The Bill, referred to the cabinet a few weeks ago, was not cleared earlier due to some technical differences between the ministries of finance and corporate affairs over the delegation of powers to stock market regulator, Securities and Exchange Board of India. The differences were later resolved by finance minister Pranab Mukherjee, Planning Commission deputy chairman Montek Singh Ahluwalia and corporate affairs minister Veerappa Moily. Apparently, it has been decided Sebi's view will be upheld in cases of conflicting jurisdictions. The United Progressive Alliance government had introduced the Companies Bill, 2008 during its previous tenure, though it lapsed with the dissolution of the 14th Lok Sabha. It was re-introduced in August 2009 and was vetted by a parliamentary standing committee on finance. The 2011 Bill incorporates most of the changes recommended by the parliamentary panel. Industry chamber Confederation of Indian Industries (CII) welcomed the decision. “CII is very hopeful the cabinet has kept the concerns of the industry in mind while clearing this important legislation,” said CII director general Chandrajit Banerjee.

Aakash to get more features, prices may go down 1 day ago

If the Rs 3,000 tablet Aakash by Datawind was not enough, the company feels that it would be able to lower the price still further and also add more features or applications every six months. CEO, Datawind, Suneet Singh Tuli who launched the worlds cheapest tablet a few weeks back said on Friday that the Aakash tablet would be available in the market from January onwards. It is being currently rolled out by the government to targeted students across the country at a subsidised price of about Rs 1,500. Tuli said that while Aakash has been called a pathbreaking product and the cheapest tablet in the world at Rs 3,000, they were hopeful of reducing the cost a little lower as sales ramp up over the next year. He said that the tablet could become a little cheaper in the coming year and more features can be added to it every six months. "Processing power, battery life many such things can be increased over a period of time and we hope that every six months there would be something new in the Aakash tablet" said Suneet Singh Tuli. Aakash has already received 3 lakh pre launch bookings and Datawind has entered into a manufacturing agreement with companies at two more places in Cochin and Noida for meeting the demand. It is currently being manufactured near Hyderabad but with sales expected to hit 50 lakh units by end 2012, the company has entered into fresh manufacturing contracts to meet the huge demand. Suneet Singh Tuli said that to spur entrepreneurship among the youth and also to identify useful apps for their tablet they have started a national contest for students to submit their innovative software applications for collaboration with Datawind. "We hope to create entrepreneurial instincts among the student community. Several money-spinners like Facebook etc were started by students still in college. Students think unconventionally unlike large corporates. If they design a useful application which is selected by the jury it would be pre-burned in millions of tablets to be shipped out by us" said Tuli. He said that while it could be a money spinner for the student who will get a royalty from the usage of application on Aakash tablet, they would also gain by offering a useful application to their users. Tuli was here to attend the Entrepreneurial Summit organized by the Indian Institute of Management, Lucknow.

Indian IT companies like Cognizant, Infosys play down gains from rupee free fall

A sharp decline in the rupee means Indian IT services exporters are getting more bang for their buck, but most top executives are wary of the sudden dip as it adds to the current uncertainty. The rupee -- Asia's worst-performing currency this year -- has skidded nearly 17 percent from a 2011 high reached in late July as risk-averse investors flee emerging markets. It rebounded as much as 1.7 percent on Wednesday, a day after it touched an all-time low of 52.73. "If the change is gradual we can manage, but if the change happens at the end of the quarter, either way, we will have a big shift. We will not have the time to adjust," Infosys Ltd's Chief Executive S.D. Shibulal said at the Reuters India Investment Summit in Bangalore on Wednesday. Indian IT companies may also not reap the full benefits of a strong dollar as many of them hedge their positions against forex fluctuations. "By the end of September, we had $3 billion hedges in rupee expenses. About 60 percent of our rupee expenses were hedged," a Cognizant executive told Reuters. India's biggest listed biotechnology company Biocon , which receives licensing revenue from its partners Mylan and Pfizer, is not upbeat on the falling rupee either, as gains will be offset by imports getting dearer. "The Reserve Bank of India and the regulators have to rein in the free falling rupee because if you don't do that your imports are just going to cripple the economy," Biocon founder and Chairman Kiran Mazumdar-Shaw said. The rapidly falling rupee is also putting pressure on sectors like autos, infrastructure and realty at a time when high interest rates have already made borrowing more expensive.

Suzlon eyes $1-billion worth of new orders every quarter

MUMBAI: Wind power major Suzlon Energy, which recently took complete control of its German subsidiary REpower, has said it will focus on value engineering to remain competitive and has set a target of bagging USD 1 billion worth of new orders every quarter for the next few years. "We are working on value engineering by introducing new products like the S9X series of turbines that will not only enable us reduce cost, but also give us a competitive advantage in the market. With the new technology, we aim to bag orders worth USD 1 billion every quarter, every year," Suzlon Energy chairman and managing director Tulsi R Tanti told PTI in an interview here. Currently, the Pune-based world's fifth largest wind turbine maker's order-book stands at USD 7 billion and has a topline of USD 5 billion. The company has created the S9X suite of low wind speed turbines - S95 and 7, with a 2.1 MW rating for all markets, which is an advancement over the successful S88 wind turbines. "The smart S9X innovation and comprehensive design increases energy yield by 14-19 per cent, improves service ability and ease of maintenance," Tanti said. The 2 MW-class turbines come in two variants of 90-m and 100-m hub heights and the rotor diameter of 95 m and 97 m. "The wind industry is rapidly evolving. The center of gravity has shifted to emerging markets, which are re-shaping the renwable energy sector. This shift is also dictating the direction of technology development, as more moderate and low wind sites become available in these new markets. The S9X suite of turbines has been developed to take advantage of these emerging opportunities," Tanti said, adding Suzlon has already received orders for 800 MW for its this new turbine. Suzlon has also started working on manufacturing products in the 9X suite, with a capacity of 3 MW and 6 MW. While the 2 MW turbines are designed for developing markets, the 3 MW will cater to the developed markets and the 6 MW for the offshore markets, he said. "By brining in these new technologies, we expect to bring down material consumption in all the three platforms by 10 per cent each. The S9X product suite is designed to provide higher return on investment for our customers through higher generation, greater efficiency and improved technology," the company chairman said. "We are working on bringing down further the cost per energy through the technology. We expect to reduce the cost per energy by 25 per cent over the next two years through technology," Tanti said. On its USD 1.28-billion order from Britain's Caparo Group to generate 1000 MW, he said, "500 MW worth of capacity will be commissioned in this fiscal, while another 500 MW will be commissioned within the following year." Suzlon to save Tanti has also said with REpower coming fully under its control, Suzlon expects to shave off 200 million euros from its overall cost structure next fiscal, which primarily involves sourcing more components from India and China. "Nearly 65 per cent of our spends are on components, a majority of which comes from Europe. But given the current scenario, we plan to concentrate on the domestic market as well as China for components. This will help in reducing our material cost by nearly 100 million euros in FY13 and another similar amount from other heads," Tanti said. The cost-saving will be on the back of acquisition of the REepower. "With the successful acquisition of the complete stake in REpower, we see ourselves well-placed in the market. We will be focusing on market positioning, joint procurement and joint technology development for all our current and future projects. REpower, which was otherwise buying components from Europe will now import it mostly from India," Tanti added. Suzlon, present in 32 markets with an installed capacity of 18,000 MW (7000 MW in the country), recently bagged USD 6.5-billion worth orders for the next three years, making it the biggest order in the area. It can be noted that Suzlon stocks fell nearly 40 per cent in the past one week. Capping lack of investor confidence was the report that promoters sold 2 per cent stake to address margin calls to bankers. When asked about this, Tanti said, the current debt of nearly Rs 9,000 crore is not a problem, considering our healthy order-book of USD 6.5 billion. "With a USD 7 billion order-book and USD 5 billion topline, USD 2 billion in debt is not a big deal." On whether the company will be in a position to pay back the USD 550 million FCB redemption due for next June and September, he said "Of course. I am not seeking any extension." The company has Rs 10,000 crore debt, out of which, around Rs 6000 crore is working a capital loan, and Rs 4000 crore is a long-term debt, which is to be re-paid over 5-7 years. Over the next 12 months, it has a repayment obligation is USD 750 million. Tanti said, "As of the September quarter, the net debt to equity ratio is 1.6 times, which we want to bring down to 1.4 by the end of the year and by March 2013, it will be be at 1:1, and that too, without raising any equity."

Indian tea to come under one brand

JORHAT: The Tea Board has decided to on focus Indian tea under one brand and launch aggressive marketing in five big markets to increase sale. "We talk of Assam, Darjeeling and Nilgiri teas but as a whole Indian tea is not focused. Its high time we focus Indian tea under one umbrella as one brand," Tea Board Deputy Chairperson Roshni Sen said here today. Speaking on the concluding day of the three-day World Tea Science Congress, Sen said the Tea Board's main focus in the 12th Plan was to brand Indian tea under one umbrella and one logo. "We will give permission for the premium teas to use the logo." As the country was losing out major markets due to inadequate promotions, she said, an aggressive programme called "555" would be introduced five focus countries for five years and for five identified activities. "The five countries are Russia, Kazakhstan, USA, Iraq and Egypt which are the biggest buyers of Indian tea. We want to build up a Brand India image there because though they are buying tea from India but branding of our tea has really not happened," she said. Dan Bolton, a tea expert from the USA, said the movement for popularising Indian tea needed more investments and stress should be on quality for the retailers to tell their customers about the quality of tea they were selling. Assam Chief Sectary Naba Kumar Das, speaking as the chief guest at the closing function, said, small tea growers needed to be given special attention for quality control. He called upon the traditional tea growing countries to share their experiences with the small tea growers.