Mumbai: The $4-billion Essel Group has launched a Rs 1,000-crore real estate private equity (PE) fund as part of its asset management foray. The fund will have a corpus of Rs 500 crore, with an option to have an additional Rs 500 crore.
Subhash Chandra-promoted media company Zee Entertainment is the principal sponsor and anchor investor in the PE fund. Zee has put in Rs 100 crore and Chandra’s family office trust gave Rs 100 crore as part of the initial closure of the fund, which took place last week, said Amit Goenka, managing director and chief executive of Essel Financial Services, the new financial services arm of Essel Group.
The group got a licence for the fund called ‘India Asset Growth Fund Series I’, which will essentially do debt funding for the residential projects in top six metros, said Goenka.
“We will do last-mile funding and bridge financing facilities to developers and target 20-22 per cent internal rate of returns from our investments,” Goenka added. The group is also looking to launch an offshore fund of $100 million in the next three-four months to augment the first fund.
After Series I, which is focusing on residential assets, the group is also looking to launch Series II sometime next year, which will invest in education assets.
The Series I fund has already deployed some funds and it is in the process of deploying the rest over the next couple of weeks.
The fund has deployed Rs 40 crore in a residential project in Chennai and plans to invest Rs 80 crore in a project in Mumbai next week, followed by a Rs 60 crore investment in a residential project in Gurgaon, he said. “We will mainly compete with non banking finance companies (NBFCs) and PE funds, which do mezzanine financing (a hybrid of debt and equity financing),” he added.
The Essel Group has appointed a six-member investment committee and a 12-member investment committee to manage the fund.
The group has proposed the names of former chairman of Knight Frank, Pranay Vakil, former chairman of Bank of Baroda, Anil Harish, former chairman of PwC, Jairaj Purandhare, and former chief of the Institute of Chartered Accountants India, Mukund Chitale, on its investment committee.
The fund-raising scenario in real estate is bouncing back in 2013. According to data from VCCedge, 15 India-dedicated realty funds have raised $1 billion in 2012, against $911 million by eight funds in 2011.
In 2013, two funds have raised $91 million. Avenue Real Estate Fund has closed its fund by raising $64 million, while ArthVeda Star Fund has raised $26.8 million in 2013.
Indiareit Fund Advisors, the PE arm of Ajay Piramal’s Piramal Enterprises, announced plans to raise Rs 200 crore over the next three months for its fifth domestic real estate fund.
The domestic fund has a total corpus of Rs 750 crore with an option to expand by Rs 250 crore. Indiareit is also planning to launch an offshore fund of $300 million (Rs 1,632 crore) next month from investors in Europe, Asia and Australia.
Other major funds in fund-raising mode include Redfort India Real Estate Fund ($500 million), Shapoorji Pallonji Real Estate Fund ($500 million) and ASK Real Estate Special Opportunities Fund ($220 million)
Success in my Habit
Tuesday, April 16, 2013
Sun Pharma gets FDA nod for generic version of Januvia
New Delhi: Indian drugmaker Sun Pharma received a tentative approval from the US drug regulator for generic version of Januvia late last week, fuelling speculation among analysts that the company has challenged the patent on the blockbuster anti-diabetes drug.
This comes as a surprise as Sun has partnered the US based multinational Merck Sharp & Dohme (MSD) in the domestic market to sue Glenmark for the patent infringement on the same drug. While confirming the tentative approval from US Food and Drug Administration (US FDA), a Sun Pharma spokesperson told ET that it can't comment on the nature of filing.
The earliest that Sun can launch the generic version of the drug is in 2022. However, industry experts say an application filed 12 to 14 years before the patents for the drug are set to expire is most likely to be a Para IV application. Apara IV filing means Sun has either challenged the validity of MSD's patent on Januvia (on the monophosphate or the product it markets) or submitted that its generic version wouldn't infringe MSD's patent.
While patent related to Januvia basic compound is set to expire on 2022, patents related to the salt or product (the monophosphate version that is marketed) will only expire in 2026 in the US. "If you check the date on which Sun Pharma filed its abbreviated new drug application for the salt Januvia, it is 18 October 2010, which is two days after NCE-1 date, a cut-off date for filing a Para IV application," an analyst said on condition of anonymity.
Two other generic players which have filed their application around the same time are US based generic giant Mylan and Sandoz, the generic arm of Swiss drugmaker Novartis. Sun Pharma's India strategy on Januvia got firmed up only in 2011 when it entered into an agreement with MSD for marketing, promoting and distributing MSD's diabetes products, including Januvia.
"We are not in litigation with Sun Pharma in the US for sitagliptin (generic name for Januvia). Filing of or tentative approval by USFDA does not provide a right to put the generic product sought in the ANDA on the market till the patent expiry date, which in this case is 2022. We have not taken any legal action against Sun, nor any other generic in the US, as they have taken a position of respect for the basic sitagliptin compound patent," a MSD spokesperson said.
"Assuming, Sun's application is of para IV type, MSD can still legally challenge Sun Pharma before 2022 and if it doesn't, it would have to be ready for a generic version of the drug in the US market, at least four years before its patent on the salt (Januvia) actually expires," the analyst said. Earlier this month, MSD sued Glenmark alleging that two its recently launched anti-diabetes drugs infringe its patent coverage of drugs Januvia and Janumet.
This comes as a surprise as Sun has partnered the US based multinational Merck Sharp & Dohme (MSD) in the domestic market to sue Glenmark for the patent infringement on the same drug. While confirming the tentative approval from US Food and Drug Administration (US FDA), a Sun Pharma spokesperson told ET that it can't comment on the nature of filing.
The earliest that Sun can launch the generic version of the drug is in 2022. However, industry experts say an application filed 12 to 14 years before the patents for the drug are set to expire is most likely to be a Para IV application. Apara IV filing means Sun has either challenged the validity of MSD's patent on Januvia (on the monophosphate or the product it markets) or submitted that its generic version wouldn't infringe MSD's patent.
While patent related to Januvia basic compound is set to expire on 2022, patents related to the salt or product (the monophosphate version that is marketed) will only expire in 2026 in the US. "If you check the date on which Sun Pharma filed its abbreviated new drug application for the salt Januvia, it is 18 October 2010, which is two days after NCE-1 date, a cut-off date for filing a Para IV application," an analyst said on condition of anonymity.
Two other generic players which have filed their application around the same time are US based generic giant Mylan and Sandoz, the generic arm of Swiss drugmaker Novartis. Sun Pharma's India strategy on Januvia got firmed up only in 2011 when it entered into an agreement with MSD for marketing, promoting and distributing MSD's diabetes products, including Januvia.
"We are not in litigation with Sun Pharma in the US for sitagliptin (generic name for Januvia). Filing of or tentative approval by USFDA does not provide a right to put the generic product sought in the ANDA on the market till the patent expiry date, which in this case is 2022. We have not taken any legal action against Sun, nor any other generic in the US, as they have taken a position of respect for the basic sitagliptin compound patent," a MSD spokesperson said.
"Assuming, Sun's application is of para IV type, MSD can still legally challenge Sun Pharma before 2022 and if it doesn't, it would have to be ready for a generic version of the drug in the US market, at least four years before its patent on the salt (Januvia) actually expires," the analyst said. Earlier this month, MSD sued Glenmark alleging that two its recently launched anti-diabetes drugs infringe its patent coverage of drugs Januvia and Janumet.
Swedish retailer Rusta sets up India operations
New Delhi: With the Indian retail sector having opened up to foreign players, it is Swedish retailer Rusta that has now announced its plans to set up its operations in the country. While the company has been sourcing finished products from India for the past one decade, the furniture and leisure products manufacturer has now come up with plans to set up its office in India as also up its imports from the country.
""We are very positive about India. India is a huge country and we realized it had to contribute to our growth more than what it is currently,"" said Goran Westerberg, CEO, Rusta.
The company, which has been sourcing goods worth $10 million from India until now, will now increase the same to around $40 million per year as well as increase its manpower as it seeks to buy products directly from suppliers now. ""We realized that running our business by way of third party agents was not a sustainable model...obviously we will grow in terms of the number of offices here too,"" Westerberg said.
The $450 million company deals in a wide range of products including furniture, decorative items, home textiles etc. While the company currently has stores only in Sweden, almost 50% of its products are sourced from other countries in Asia and Europe.
With the new investments in place, Westerberg said India will rank as the company's second biggest market for sourcing after China in the next few years. Currently India remains at the tenth position, ranking after China, Indonesia, Vietnam and others. Almost 45% of products for the company is being sourced from China.
Despite the government allowing 100% foreign direct investment ( FDI) in the single brand retail sector, the company said it is not keen on setting up its stores in the country. Even as opening of the sector will provide India with the necessary skills and competence, Westerberg said the company will first explore Scandinavian countries for expansion before looking at Asia.
""We are looking at India as a long term market. It is a huge challenge to get known here, both as an importer and a retailer,"" he said.
Rusta currently has 67 stores in Sweden and plans to add 10-12 stores every year. The company has five offices in Asia, including in China, Bangkok, Shanghai and now India.
""We are very positive about India. India is a huge country and we realized it had to contribute to our growth more than what it is currently,"" said Goran Westerberg, CEO, Rusta.
The company, which has been sourcing goods worth $10 million from India until now, will now increase the same to around $40 million per year as well as increase its manpower as it seeks to buy products directly from suppliers now. ""We realized that running our business by way of third party agents was not a sustainable model...obviously we will grow in terms of the number of offices here too,"" Westerberg said.
The $450 million company deals in a wide range of products including furniture, decorative items, home textiles etc. While the company currently has stores only in Sweden, almost 50% of its products are sourced from other countries in Asia and Europe.
With the new investments in place, Westerberg said India will rank as the company's second biggest market for sourcing after China in the next few years. Currently India remains at the tenth position, ranking after China, Indonesia, Vietnam and others. Almost 45% of products for the company is being sourced from China.
Despite the government allowing 100% foreign direct investment ( FDI) in the single brand retail sector, the company said it is not keen on setting up its stores in the country. Even as opening of the sector will provide India with the necessary skills and competence, Westerberg said the company will first explore Scandinavian countries for expansion before looking at Asia.
""We are looking at India as a long term market. It is a huge challenge to get known here, both as an importer and a retailer,"" he said.
Rusta currently has 67 stores in Sweden and plans to add 10-12 stores every year. The company has five offices in Asia, including in China, Bangkok, Shanghai and now India.
Public sector units spent $8.5 b on IT in FY12: Zinnov
Mumbai: Public sector units (PSUs) spent $8.5 billion in FY12 on IT, more than 2 per cent of their total revenues. It was higher compared with other verticals and mainly for the energy and banking, financial services and insurance (BFSI) verticals, according to a study by market research firm Zinnov.
“IT is viewed to be a major cost reduction enabler in many PSUs, given the automation of processes and integrated IT set-ups. Today, PSUs are looking at IT to analyse customer information efficiently and develop targeted and customised offerings for customers,” said Praveen Bhadada, Director (Market Expansion) at Zinnov.
The PSUs, with revenue growths of 11 per cent since 2009, posted a total turnover of $383 billion in FY12 and employ 1.4 million personnel. About 40 per cent of the PSUs are in the manufacturing sector.
The investment in technology is shaping the growth of the PSUs. Government companies are investing in technology to help address the challenges they faced in the early years of transition towards establishing a transparent and accountable organisation, reducing cost of production and enhancing productivity and customer reach.
“India is a hub of 225 PSUs operating across verticals, with 16 of these companies featuring in the global list of top 2,000 companies. With their growing size and dominance, PSUs have started looking at IT to address global competition,” added Bhadada. Examples include that of State Bank of India and the public sector oil marketing company Bharat Petroleum Corporation Ltd (BPCL). SBI, the country’s largest banker, implemented a global core banking solution, while BPCL made early investments in big data.
The PSUs will post a turnover of more than $1 trillion by 2020. A large part of this will be invested in IT including cloud, big data and mobility.
“IT is viewed to be a major cost reduction enabler in many PSUs, given the automation of processes and integrated IT set-ups. Today, PSUs are looking at IT to analyse customer information efficiently and develop targeted and customised offerings for customers,” said Praveen Bhadada, Director (Market Expansion) at Zinnov.
The PSUs, with revenue growths of 11 per cent since 2009, posted a total turnover of $383 billion in FY12 and employ 1.4 million personnel. About 40 per cent of the PSUs are in the manufacturing sector.
The investment in technology is shaping the growth of the PSUs. Government companies are investing in technology to help address the challenges they faced in the early years of transition towards establishing a transparent and accountable organisation, reducing cost of production and enhancing productivity and customer reach.
“India is a hub of 225 PSUs operating across verticals, with 16 of these companies featuring in the global list of top 2,000 companies. With their growing size and dominance, PSUs have started looking at IT to address global competition,” added Bhadada. Examples include that of State Bank of India and the public sector oil marketing company Bharat Petroleum Corporation Ltd (BPCL). SBI, the country’s largest banker, implemented a global core banking solution, while BPCL made early investments in big data.
The PSUs will post a turnover of more than $1 trillion by 2020. A large part of this will be invested in IT including cloud, big data and mobility.
India, Finland to explore solar energy applications for oil & gas projects
New Delhi: India and Finland have identified several key areas of collaboration in sustainable development for mutual benefits in the oil & gas sector, which includes specific projects in solar energy applications for oil & gas Projects, biofuels & algae based biofuels research and water and waste water management.
Other areas indentified are carbon capture and reformation, Finland's Green Growth & Groove programme for suitable application to Indian scenario and academic institutions/universities for collaborative R&D projects in areas of low carbon growth technologies and sustainable development, oil ministry said in a statement.
An agreement between the two countries on these matters are expected, it said after a bilateral meeting between delegations of the two countries. Indian delegation was represented by Petroleum Minister for State Lakshmi Panabaka and Marja Rislakki, State Secretary, Ministry of Employment & Economy of Finland.
Other areas indentified are carbon capture and reformation, Finland's Green Growth & Groove programme for suitable application to Indian scenario and academic institutions/universities for collaborative R&D projects in areas of low carbon growth technologies and sustainable development, oil ministry said in a statement.
An agreement between the two countries on these matters are expected, it said after a bilateral meeting between delegations of the two countries. Indian delegation was represented by Petroleum Minister for State Lakshmi Panabaka and Marja Rislakki, State Secretary, Ministry of Employment & Economy of Finland.
Monday, April 15, 2013
L&T to acquire Komatsu stake in joint venture
Mumbai: Larsen and Toubro will acquire the 50 per cent stake held by Komatsu Asia & Pacific in L&T-Komatsu Ltd (LTK).
Komatsu Asia & Pacific is a wholly-owned subsidiary of Komatsu Ltd, Japan.
L&T declined to furnish details of the transaction and said the value was insignificant. L&T holds the balance stake.
Komatsu is the largest manufacturer of hydraulic excavators and has manufacturing and marketing facilities worldwide.
With this buy-out, LTK will become a wholly owned subsidiary of L&T.
L&T Komatsu will continue to manufacture construction equipment and hydraulic components. Komatsu will be responsible for the production of Komatsu equipment including hydraulic excavators, L&T said.
L&T will continue to extend marketing, sales and product support in India for the Komatsu range of products.
L&T started the Bangalore unit to make hydraulic excavators in 1975. It inked the joint venture in 1998.
The Bangalore facility comprises machinery and hydraulic works. The products manufactured at L&T-Komatsu are supplied to domestic and overseas customers.
Komatsu Asia & Pacific is a wholly-owned subsidiary of Komatsu Ltd, Japan.
L&T declined to furnish details of the transaction and said the value was insignificant. L&T holds the balance stake.
Komatsu is the largest manufacturer of hydraulic excavators and has manufacturing and marketing facilities worldwide.
With this buy-out, LTK will become a wholly owned subsidiary of L&T.
L&T Komatsu will continue to manufacture construction equipment and hydraulic components. Komatsu will be responsible for the production of Komatsu equipment including hydraulic excavators, L&T said.
L&T will continue to extend marketing, sales and product support in India for the Komatsu range of products.
L&T started the Bangalore unit to make hydraulic excavators in 1975. It inked the joint venture in 1998.
The Bangalore facility comprises machinery and hydraulic works. The products manufactured at L&T-Komatsu are supplied to domestic and overseas customers.
Outbound tourism market from India grows: Four emerging trends
New Delhi: Foreign tourist boards are gearing up to meet the growing number of Indians who are travelling abroad and splurging. Starting direct flights is the first step.
Never mind the sluggish economy and poor sentiments, there's good news from the world of travel and tourism. India has emerged as the world's fastest-growing outbound market and in absolute numbers it is second only to China. The number of Indians travelling overseas is set to rise from around 15 million today to 50 million by 2020, according to Tourism Australia.
This will mean a big growth in spending overseas. According to a recently released Amadeus-Frost & Sullivan tourism industry report, Indians travelling to Asia-Pacific alone spent $13.3 billion in 2011. This figure is set to zoom to $91 billion by 2030, making Indians the second-biggest spenders, after China, in the world on overseas travel.
Not surprisingly, the world is taking note. Tourism Australia hopes to get 300,000 Indian tourists by 2020. South Africa Tourism Board too says India has become one of the key tourism generating nations for their country. Indian tourist arrivals to Thailand crossed the 1-million mark for the first time in 2012.
Thai Airways have recently started direct flights between Delhi and Phuket and Mumbai and Phuket to cater to the surging demand from Indians looking for wedding destinations and holidays. "Direct flights are a good precursor to the growth in tourist numbers," says Deep Kalra, founder, Makemytrip.com.
The introduction of direct flights between India and Istanbul has led to a sharp rise in Indian tourists travelling to Istanbul, Kalra notes. Spotting demand, Turkish Airlines today connects many Indian cities including Delhi, Mumbai and Hyderabad with Istanbul.
Travel to Meet Family
In pre-liberalisation days, with little disposable income and fewer options, holidays for most middle-class Indians were about visiting friends and families in India. It is a trend that is playing out well overseas among globetrotting Indians.
According to the Amadeus-Frost & Sullivan report, a high 43% of leisure travellers from India say visiting friends and relatives (VFR) was the main reason behind their overseas travel.
Partly this has to do with the growing diaspora — estimated by the government at 25 million but Kalra puts it at around 100 million. The VFR travellers behave differently than standard vacation travellers, says Ankur Bhatia, director, Amaedus India. "They travel for longer periods, and typically do not book hotels but stay with friends and relatives," he says.
Extended Weekends — Abroad
Weekend holidays in nearby hill stations are passe. Now with direct flights to a number of foreign tourist destinations, Indians would rather spend their extended weekends overseas.
Short-haul direct international flights — anything around five hours of flight time — are seeing the biggest growth, says Kalra. Maldives, Thailand, Hong Kong, the UAE and Dubai are some of the important emerging destinations.
The fact that it is cheaper to travel and holiday in Thailand than in Kerala, and stay in better hotels, is a big incentive. Also noticeable is the fact that Indians are taking more frequent holidays.
According to the Makemytrip data, while Indians would typically take an international holiday once in 18-24 months five years back, the frequency is now once in 12-18 months.
New Niches, Customised Offerings
Of course the demand for packaged tours offered by companies like Cox & Kings is growing among Indians travelling overseas for the first time. But more and more globetrotting Indians are turning experimental, looking to customise trips, opting for offbeat destinations and newer experiences.
According to the Amadeus-Frost & Sullivan report, while the number of solo women and senior Indians (65 years-plus) travelling overseas is still a small category in both the business and leisure segments, it is likely to grow many fold by 2030.
Women business travellers, today pegged at 25% of the total, are set to rise by 891% by 2030. And senior travellers, currently pegged at 1.3 million, are set to rise to 7.3 million by 2030.
There is a small but growing category of Indian food lovers, says Himmat Anand, founder of Tree of Life Resort, who is a travel industry veteran having worked with Sita Travels and Kuoni India.
"Earlier, it was an afterthought. But now, food is becoming very important, especially at the upper end," he says. All this means that the companies in travel and tourism will have plenty of opportunities to differentiate themselves and customise their offerings to lure international travellers from India.
Growth at the Top and BOP
Experts see two categories of Indian travellers growing — at the top end and the bottom end — as incomes rise. This isn't true just for India but Asia Pacific at large.
From around 700 million people in the middle class in 2011, the number is set to touch 2.1 billion by 2030, signalling the rise of what is called the consuming class (annual household income of $5,000 plus). The biggest chunk of this growth will come from China and India.
India's middle class, the report estimates, will grow from the present 5% to 50% by 2030. Similarly, HNIs are expected to grow six fold by 2030 — from around 0.2 million in 2011 to over 1.2 million by 2030. This segment will fuel growth at the luxury end of the market.
Never mind the sluggish economy and poor sentiments, there's good news from the world of travel and tourism. India has emerged as the world's fastest-growing outbound market and in absolute numbers it is second only to China. The number of Indians travelling overseas is set to rise from around 15 million today to 50 million by 2020, according to Tourism Australia.
This will mean a big growth in spending overseas. According to a recently released Amadeus-Frost & Sullivan tourism industry report, Indians travelling to Asia-Pacific alone spent $13.3 billion in 2011. This figure is set to zoom to $91 billion by 2030, making Indians the second-biggest spenders, after China, in the world on overseas travel.
Not surprisingly, the world is taking note. Tourism Australia hopes to get 300,000 Indian tourists by 2020. South Africa Tourism Board too says India has become one of the key tourism generating nations for their country. Indian tourist arrivals to Thailand crossed the 1-million mark for the first time in 2012.
Thai Airways have recently started direct flights between Delhi and Phuket and Mumbai and Phuket to cater to the surging demand from Indians looking for wedding destinations and holidays. "Direct flights are a good precursor to the growth in tourist numbers," says Deep Kalra, founder, Makemytrip.com.
The introduction of direct flights between India and Istanbul has led to a sharp rise in Indian tourists travelling to Istanbul, Kalra notes. Spotting demand, Turkish Airlines today connects many Indian cities including Delhi, Mumbai and Hyderabad with Istanbul.
Travel to Meet Family
In pre-liberalisation days, with little disposable income and fewer options, holidays for most middle-class Indians were about visiting friends and families in India. It is a trend that is playing out well overseas among globetrotting Indians.
According to the Amadeus-Frost & Sullivan report, a high 43% of leisure travellers from India say visiting friends and relatives (VFR) was the main reason behind their overseas travel.
Partly this has to do with the growing diaspora — estimated by the government at 25 million but Kalra puts it at around 100 million. The VFR travellers behave differently than standard vacation travellers, says Ankur Bhatia, director, Amaedus India. "They travel for longer periods, and typically do not book hotels but stay with friends and relatives," he says.
Extended Weekends — Abroad
Weekend holidays in nearby hill stations are passe. Now with direct flights to a number of foreign tourist destinations, Indians would rather spend their extended weekends overseas.
Short-haul direct international flights — anything around five hours of flight time — are seeing the biggest growth, says Kalra. Maldives, Thailand, Hong Kong, the UAE and Dubai are some of the important emerging destinations.
The fact that it is cheaper to travel and holiday in Thailand than in Kerala, and stay in better hotels, is a big incentive. Also noticeable is the fact that Indians are taking more frequent holidays.
According to the Makemytrip data, while Indians would typically take an international holiday once in 18-24 months five years back, the frequency is now once in 12-18 months.
New Niches, Customised Offerings
Of course the demand for packaged tours offered by companies like Cox & Kings is growing among Indians travelling overseas for the first time. But more and more globetrotting Indians are turning experimental, looking to customise trips, opting for offbeat destinations and newer experiences.
According to the Amadeus-Frost & Sullivan report, while the number of solo women and senior Indians (65 years-plus) travelling overseas is still a small category in both the business and leisure segments, it is likely to grow many fold by 2030.
Women business travellers, today pegged at 25% of the total, are set to rise by 891% by 2030. And senior travellers, currently pegged at 1.3 million, are set to rise to 7.3 million by 2030.
There is a small but growing category of Indian food lovers, says Himmat Anand, founder of Tree of Life Resort, who is a travel industry veteran having worked with Sita Travels and Kuoni India.
"Earlier, it was an afterthought. But now, food is becoming very important, especially at the upper end," he says. All this means that the companies in travel and tourism will have plenty of opportunities to differentiate themselves and customise their offerings to lure international travellers from India.
Growth at the Top and BOP
Experts see two categories of Indian travellers growing — at the top end and the bottom end — as incomes rise. This isn't true just for India but Asia Pacific at large.
From around 700 million people in the middle class in 2011, the number is set to touch 2.1 billion by 2030, signalling the rise of what is called the consuming class (annual household income of $5,000 plus). The biggest chunk of this growth will come from China and India.
India's middle class, the report estimates, will grow from the present 5% to 50% by 2030. Similarly, HNIs are expected to grow six fold by 2030 — from around 0.2 million in 2011 to over 1.2 million by 2030. This segment will fuel growth at the luxury end of the market.
Farm output may rise 130% in 20 years: CII-McKinsey report
New Delhi: India can achieve a leadership position in the world food market and also meet its growing domestic demand, promises a report by CII-McKinsey, issued today.
The assurance is based, it says, on various steps to be taken on policy, with the active involvement of the private sector. Termed the third Food and Agriculture Integrated Development Action Report (Faida), it has been jointly prepared by the Confederation of Indian Industry (CII) and consultants McKinsey & Company.
The report says India has the potential to increase its value of agricultural output by 130 per cent (at farmgate prices), from Rs 12.7 lakh crore in 2011 to Rs 29.3 lakh crore in 2030, if it follows a 12-point plan to improve yields across all crops, augmenting processing capability and strengthening the quality of farm produce. It wants a mix of business participation, technology-oriented productivity growth, food processing and exports, over the next 20 years.
"Agriculture needs to get into a mission mode and our analysis shows that instead of focusing on grains and cereals, the first step should be for perishables. Both Centre and states need to move fast in this sector, to create an enabling policy environment by keeping perishable commodities out of the ambit of the Agriculture Produce Marketing Committee Act," said Adil Zainulbhai, chairman-India of McKinsey.
‘A high-value powerhouse’
Titled ‘India as an agriculture and high value food powerhouse: A new vision for 2030’, the report said processing of farm items have the potential to grow by 414 per cent to Rs 5.7 lakh crore in 2030 from Rs 1.1 lakh crore in 2011. And, food exports to rise 452 per cent, from Rs 1.4 lakh crore in 2011 to Rs 7.7 lakh crore in 2030. "All these are conservative estimates and Indian agriculture has much more potential," said Rakesh B Mittal, past chairman of the CII National Council on Agriculture and chairman of Faida-3.
“As an outcome (of all this), the sector could grow by 5.2-5.7 per cent (in real terms, annually) over the next 20 years,” the 100-plus page report said.
It identified mango, banana, potato, soybean and poultry as five items to drive the next wave of growth in Indian agriculture.
The report says India presently achieves just 50-60 per cent of the potential yield for most crops. The reasons include poor technology adoption, weak links between farmers and industry, unexplored opportunities in branding, marketing and exports, lack of infrastructure support and dearth of extension support.
As a direct correlation of the high growth it promises, it says farmer income will rise by over four times in real terms, while consumers will also benefit from the increase in supplies, which in turn will help match India’s estimated per capita consumption of food items in 2030. It estimates the latter figure to increase from Rs 9,360 to Rs 15,390 (an annual increase of three per cent at 2010 prices) in the next 20 years.
In the past decade,consumption of food items has moved more towards high-value ones such as fruits, vegetables, milk, meat and fish.
"The ratio tof cereals and pulses in the overall food budget of the average Indian consumer has dropped by more than 25 per cent in the last one decade," the report said. In 2000, basic foodgrains formed 60 per cent of the total agricultural produce by weight, with high-value produce constituting 38 per cent. By 2010, high-value food formed 45 per cent of total production and this proportion will increase.
How
To achieve its target, the report has a list of 12 key points. It wants, for instance, a National Farm Gate to Market Infrastructure Authority, on the lines of the National Highways Authority of India, to integrate the working of multiple authorities in the logistics segments.
“There are many bodies like the National Centre for Cold Chain Development Authority, National Horticulture Board, APEDA, Ministry of Food Processing, etc, involved in building and managing the farm gate infrastructure in terms of sorting, packaging, storage and transportation. Due to multiple players, there is fragmentation and insufficient accountability for an integrated solution,” the report said.
"This all encompassing authority will clearly define what each of the above mentioned bodies needs to do so, as to provide a seamless cold chain infrastructure in the country," said Zainulbhai.
It also advocated a favourable policy regime for agriculture marketing, through removal of caps on subsidies for essential agriculture investments, review of taxation structures and stock limits and a unified regulatory mechanism for organised input retail, which would provide farmers with a one-stop shop for all farm inputs and amendments to the land ceiling Aact, to promote corporate farming and aggregation of land through long-tenure leases, say for a period of 10 years.
The report also called for starting two separate missions, one on agricultural technology and the other on sustainable farming, to promote high-quality seeds, scientific farming and yield improvement mechanisms. The sustainability mission, the report said, should create a national map of soil type and water availability, to identify areas that need to replenish specific nutrients.
For ensuring consumers and farmers develop a taste for branded food products, the report has advocated creation of a new segment called ‘branded food’, which would be led by the industry, be voluntary and on the lines of the ‘Woolmark’ brand for wool items.
Brands, flows
“The development of branded food would assure consumers of its freshness, healthiness, quality and traceability,” the report said. To promote export of select items, the government should set up a National Agriculture and Food Export Mission, with the help of private players that would identify the right products and markets, invest in market creation, ensure adherence to international quality benchmarks. "The first Faida report said India's food processing sector would become a Rs 215,000-225,000 crore industry by 2005 but till 2010, it has become only a Rs 66,000 crore industry, thus realising only 10 per cent of its potential," the report said.
India should learn from countries who have successfully marketed their farm produce worldwide, like ‘Florida Oranges’, the report said.
On extension services, the report asked for participation of private entities. “The Agricultural Technology Management Agency has only 100,000 extension workers, which is 10 per cent of the requirement. The Krishi Vigyan Kendras (KVKs) have a similar story to tell, with only one KVK per district, each with about 20 scientific staff members.”
It also called for setting up an Indian Institute of Agriculture Technology, on the lines of IITs and IIMs, and a network of four or five world-class food and agriculture institutes across the country. “There is a need to create a new generation of agri-entrepreneurs who will lead this next wave of growth,” it recommends. It also advocated more industry-farmer partnerships, through established models like farmer-producer organisations and farmer-producer companies.
The assurance is based, it says, on various steps to be taken on policy, with the active involvement of the private sector. Termed the third Food and Agriculture Integrated Development Action Report (Faida), it has been jointly prepared by the Confederation of Indian Industry (CII) and consultants McKinsey & Company.
The report says India has the potential to increase its value of agricultural output by 130 per cent (at farmgate prices), from Rs 12.7 lakh crore in 2011 to Rs 29.3 lakh crore in 2030, if it follows a 12-point plan to improve yields across all crops, augmenting processing capability and strengthening the quality of farm produce. It wants a mix of business participation, technology-oriented productivity growth, food processing and exports, over the next 20 years.
"Agriculture needs to get into a mission mode and our analysis shows that instead of focusing on grains and cereals, the first step should be for perishables. Both Centre and states need to move fast in this sector, to create an enabling policy environment by keeping perishable commodities out of the ambit of the Agriculture Produce Marketing Committee Act," said Adil Zainulbhai, chairman-India of McKinsey.
‘A high-value powerhouse’
Titled ‘India as an agriculture and high value food powerhouse: A new vision for 2030’, the report said processing of farm items have the potential to grow by 414 per cent to Rs 5.7 lakh crore in 2030 from Rs 1.1 lakh crore in 2011. And, food exports to rise 452 per cent, from Rs 1.4 lakh crore in 2011 to Rs 7.7 lakh crore in 2030. "All these are conservative estimates and Indian agriculture has much more potential," said Rakesh B Mittal, past chairman of the CII National Council on Agriculture and chairman of Faida-3.
“As an outcome (of all this), the sector could grow by 5.2-5.7 per cent (in real terms, annually) over the next 20 years,” the 100-plus page report said.
It identified mango, banana, potato, soybean and poultry as five items to drive the next wave of growth in Indian agriculture.
The report says India presently achieves just 50-60 per cent of the potential yield for most crops. The reasons include poor technology adoption, weak links between farmers and industry, unexplored opportunities in branding, marketing and exports, lack of infrastructure support and dearth of extension support.
As a direct correlation of the high growth it promises, it says farmer income will rise by over four times in real terms, while consumers will also benefit from the increase in supplies, which in turn will help match India’s estimated per capita consumption of food items in 2030. It estimates the latter figure to increase from Rs 9,360 to Rs 15,390 (an annual increase of three per cent at 2010 prices) in the next 20 years.
In the past decade,consumption of food items has moved more towards high-value ones such as fruits, vegetables, milk, meat and fish.
"The ratio tof cereals and pulses in the overall food budget of the average Indian consumer has dropped by more than 25 per cent in the last one decade," the report said. In 2000, basic foodgrains formed 60 per cent of the total agricultural produce by weight, with high-value produce constituting 38 per cent. By 2010, high-value food formed 45 per cent of total production and this proportion will increase.
How
To achieve its target, the report has a list of 12 key points. It wants, for instance, a National Farm Gate to Market Infrastructure Authority, on the lines of the National Highways Authority of India, to integrate the working of multiple authorities in the logistics segments.
“There are many bodies like the National Centre for Cold Chain Development Authority, National Horticulture Board, APEDA, Ministry of Food Processing, etc, involved in building and managing the farm gate infrastructure in terms of sorting, packaging, storage and transportation. Due to multiple players, there is fragmentation and insufficient accountability for an integrated solution,” the report said.
"This all encompassing authority will clearly define what each of the above mentioned bodies needs to do so, as to provide a seamless cold chain infrastructure in the country," said Zainulbhai.
It also advocated a favourable policy regime for agriculture marketing, through removal of caps on subsidies for essential agriculture investments, review of taxation structures and stock limits and a unified regulatory mechanism for organised input retail, which would provide farmers with a one-stop shop for all farm inputs and amendments to the land ceiling Aact, to promote corporate farming and aggregation of land through long-tenure leases, say for a period of 10 years.
The report also called for starting two separate missions, one on agricultural technology and the other on sustainable farming, to promote high-quality seeds, scientific farming and yield improvement mechanisms. The sustainability mission, the report said, should create a national map of soil type and water availability, to identify areas that need to replenish specific nutrients.
For ensuring consumers and farmers develop a taste for branded food products, the report has advocated creation of a new segment called ‘branded food’, which would be led by the industry, be voluntary and on the lines of the ‘Woolmark’ brand for wool items.
Brands, flows
“The development of branded food would assure consumers of its freshness, healthiness, quality and traceability,” the report said. To promote export of select items, the government should set up a National Agriculture and Food Export Mission, with the help of private players that would identify the right products and markets, invest in market creation, ensure adherence to international quality benchmarks. "The first Faida report said India's food processing sector would become a Rs 215,000-225,000 crore industry by 2005 but till 2010, it has become only a Rs 66,000 crore industry, thus realising only 10 per cent of its potential," the report said.
India should learn from countries who have successfully marketed their farm produce worldwide, like ‘Florida Oranges’, the report said.
On extension services, the report asked for participation of private entities. “The Agricultural Technology Management Agency has only 100,000 extension workers, which is 10 per cent of the requirement. The Krishi Vigyan Kendras (KVKs) have a similar story to tell, with only one KVK per district, each with about 20 scientific staff members.”
It also called for setting up an Indian Institute of Agriculture Technology, on the lines of IITs and IIMs, and a network of four or five world-class food and agriculture institutes across the country. “There is a need to create a new generation of agri-entrepreneurs who will lead this next wave of growth,” it recommends. It also advocated more industry-farmer partnerships, through established models like farmer-producer organisations and farmer-producer companies.
Visa on Arrival Scheme registers a growth of 63 percent
New Delhi: The Visa on Arrival (VOA) scheme of the Government for foreign tourists registered a growth of 63% during March, 2013. During the month, a total number of 2,107 VoAs were issued as compared to 1,287 VoAs issued during March, 2012.
The following are the other important highlights of VoAs issued during March, 2013:
During the period January to March 2013, a total number of 5,744 VoAs were issued as compared to 3,905 VoAs during corresponding period of 2012 registering a positive growth of 47.1%.
The number of VoAs issued under this scheme during March 2013 for nationals of the eleven countries were Japan (848), New Zealand (332), Indonesia (312), the Philippines (225), Singapore (214), Finland (109), Luxembourg (32), Vietnam (20), Myanmar (8), Cambodia (7) and Laos (0).
The number of VoAs issued under the Scheme during January to March 2013 were Japan (2251), New Zealand (985), Indonesia (739), the Philippines (631), Singapore (571), Finland (386), Luxembourg (61), Vietnam (53), Cambodia (42), Myanmar (22) and Laos (3).
During the period January to March 2013, the highest number of VoAs were issued at Delhi airport (3371) followed by Mumbai (1239), Chennai (778) and Kolkata (356).
The following are the other important highlights of VoAs issued during March, 2013:
During the period January to March 2013, a total number of 5,744 VoAs were issued as compared to 3,905 VoAs during corresponding period of 2012 registering a positive growth of 47.1%.
The number of VoAs issued under this scheme during March 2013 for nationals of the eleven countries were Japan (848), New Zealand (332), Indonesia (312), the Philippines (225), Singapore (214), Finland (109), Luxembourg (32), Vietnam (20), Myanmar (8), Cambodia (7) and Laos (0).
The number of VoAs issued under the Scheme during January to March 2013 were Japan (2251), New Zealand (985), Indonesia (739), the Philippines (631), Singapore (571), Finland (386), Luxembourg (61), Vietnam (53), Cambodia (42), Myanmar (22) and Laos (3).
During the period January to March 2013, the highest number of VoAs were issued at Delhi airport (3371) followed by Mumbai (1239), Chennai (778) and Kolkata (356).
India and Mauritius sign memorandum of understanding on electoral cooperation
New Delhi: India and Mauritius have signed a Memorandum of Understanding (MoU) in New Delhi, for cooperation in the field of election management and administration.
The MoU was signed by the Chief Election Commissioner of India, Shri V.S. Sampath and the Electoral Commissioner of Mauritius, Mr. Mohammad Irfan Abdool Rahman. Election Commissioners of India, Shri H. S. Brahma and Dr. Nasim Zaidi; diplomats and senior officials of the Election Commission of India and Government of India were present at the signing ceremony.
The major aims of MoU are: promotion of exchanges of knowledge and experience in electoral processes; exchange of information, materials, expertise and training of personnel; production and distribution of materials pertaining to electoral systems, voting technology, voters’ education and awareness, and participation of women and minorities in electoral process.
Shri Sampath described the MoU as a great landmark and an important mechanism for strengthening and deepening mutual collaboration between ECI and the Electoral Commissioner’s Office of Mauritius. He expressed the confidence that the MoU would facilitate sharing of best practices, skills and experiences between the two institutions for mutual benefit. He stated that the partnership between two important Democracies – India and Mauritius – is a very good augury not only for the region but for the whole world.
Election Commissioner, Mr. Brahma offered the available expertise and facilities in India for strengthening the electoral system in Mauritius.
Mr. Abdool Rahman praised the expertise and experience gained by ECI over six decades in conducting the largest elections in the world in a peaceful, transparent and credible manner. He also stated that this MoU would formalize the very special relationship between the two Commissions and will strengthen the ongoing cooperation between them. He commended ECI’s initiative in setting up India Institute of Democracy and Election Management (IIIDEM), which is a world-class training and resource centre and stated that his office would be very interested in utilizing its training facilities. He also acknowledged that the Model Electoral Code of Mauritius has drawn inspiration from India’s Model Code of Conduct.
Election Commission of India has so far signed seventeen MOUs with Election Management Bodies and international organizations across the world. Some of the MoU signed recently are with Egypt, Venezuela, Republic of Korea and UNDP.
The MoU was signed by the Chief Election Commissioner of India, Shri V.S. Sampath and the Electoral Commissioner of Mauritius, Mr. Mohammad Irfan Abdool Rahman. Election Commissioners of India, Shri H. S. Brahma and Dr. Nasim Zaidi; diplomats and senior officials of the Election Commission of India and Government of India were present at the signing ceremony.
The major aims of MoU are: promotion of exchanges of knowledge and experience in electoral processes; exchange of information, materials, expertise and training of personnel; production and distribution of materials pertaining to electoral systems, voting technology, voters’ education and awareness, and participation of women and minorities in electoral process.
Shri Sampath described the MoU as a great landmark and an important mechanism for strengthening and deepening mutual collaboration between ECI and the Electoral Commissioner’s Office of Mauritius. He expressed the confidence that the MoU would facilitate sharing of best practices, skills and experiences between the two institutions for mutual benefit. He stated that the partnership between two important Democracies – India and Mauritius – is a very good augury not only for the region but for the whole world.
Election Commissioner, Mr. Brahma offered the available expertise and facilities in India for strengthening the electoral system in Mauritius.
Mr. Abdool Rahman praised the expertise and experience gained by ECI over six decades in conducting the largest elections in the world in a peaceful, transparent and credible manner. He also stated that this MoU would formalize the very special relationship between the two Commissions and will strengthen the ongoing cooperation between them. He commended ECI’s initiative in setting up India Institute of Democracy and Election Management (IIIDEM), which is a world-class training and resource centre and stated that his office would be very interested in utilizing its training facilities. He also acknowledged that the Model Electoral Code of Mauritius has drawn inspiration from India’s Model Code of Conduct.
Election Commission of India has so far signed seventeen MOUs with Election Management Bodies and international organizations across the world. Some of the MoU signed recently are with Egypt, Venezuela, Republic of Korea and UNDP.
Subscribe to:
Posts (Atom)