International Economy MS 97-2003 09082010

8/8/2019 International Economy MS 97-2003 09082010

1/146

Emerging India

Long Term Business

Perspective


2/146

Sequence of Presentation

General Introduction and Acknowledgement Major Events of Recent Past Emerging India Economists View

Need to Integrate to Meet Our Food, Raw-material,Energy etc. A Few Selected Issues Which are of Relevance India Reaching the World

A Few Case Studies


3/146

CHALLENGE ANDRESPONSE

Every organization, organism, society,institution, living entity develops/evolvethrough a process of:


4/146

Issues Commonly Raised WhileDiscussing Indias Success Story

Indian Youth, Educated, Large Middle Class, Technical Manpower,Entrepreneur, Rural India, Green Revolution, White Revolution,Software, Consumer Market, High Saving Rate, High GDP,Overseas Indians, NRI, Financial Markets, FDI, FII, Rich MineralResources, Rich Indians, BPO, KPO, Independent Media,

Poverty, Illiteracy, Inflation, Unemployment, Corruption,Bureaucracy, Crime, Inefficient -Agriculture, Port, Railways etc.Out dated laws and Justice system, Naxal Movement, Pollution,Infrastructure, Environment Protection, Inefficient PSU


5/146

Indian Society faces three

serious Challenges in the longterm:-

-Criminalization of Politics

-Funding of democratic Political Process-Women's Emancipation

Our Political Masters during the last 2-

3decades have not been able to respond to these challenges comprehensively


6/146

Source and Acknowledgement

Gravity Shift - How Asias New Economic Powerhouses will shape the 21 st Century by WendyDobson

Goldman Sachs- Dreaming With BRICs: The Path to 2050 Global Economics Paper 99

Goldman Sachs- Ten Things for India to achieve its 2050 potential by Jim ONiell and TusharPoddar June16th 2008

Coal Initiative Report -A Resource and Technology Assessment of Coal Utilization in India AnantP. Chikkatur Kennedy School of Government Harvard University Cambridge MA October 2008

Africa Development Indicators 2007- The World Bank USDA Agricultural Projections to 2019

Economic Growth and Geo- political Power - The Emergence of Tri-polar World by Dr. ArvindVirmani Director and CE, ICRIER ( Indian Council for Research on International EconomicsRelations)

North Eastern Region Vision 2020 -Min. of Dev. Of North Eastern Region and North EasternCouncil


7/146

Interesting Books

The Corporation that changed the World -How theEast India Company Shaped the Modern World By NickRobins

The Rise and Fall of the Great Powers -economicchange and military conflict from 1500 to 2000 by PaulKennedy

Preparing for the Twenty -First Century-by Paul Kennedy The World in 2020 -power,culture and prosperity: a vision

of the future by Hamish McRae The End of Nation State- The Rise of Regional Economies

by Kenichi Ohmae We are like that only - Understanding the logic of

consumer India by Rama Bijapurkar


8/146

Indias Recent Past1950sHoneymoonPeriodRaj Kapoor,Nargis,DileepKumarPt.

JawaharlalLal NehruDream of aBeautifulIndiaGreat IdealsDemocracytakes root

1960sChinaWar-1962PakistanWar-1965WorstDraught-1967

GreenRev.

1970sBangladeshWarEmergencyPolitical

TurmoilNationalization

White Rev.

1980-90sRajiv Gandhi-New HopeCourseCorrectionLiberalization

TV/Entertain--ment Rev.

2000-NewMillenniumGrowth &ProsperityConfidentNationOptimistic

Young IndiaReady totake on theWorld

ITES

What Next?


9/146

World Economic Output SelectedCountries 1300-2030


10/146

Goldman Sachs- Ten Things for India toachieve its 2050 potential by Jim ONiell

and Tushar Poddar

Improve Governance

Raise Educational Achievement

Increase Quality and Quantity of University

Control Inflation

Introduce a Credible Fiscal Policy Liberalize Financial Market

Increase Trade with Neighbors

Increase Agricultural Productivity

Improve Infrastructure

Improve Environmental Quality


11/146


12/146


13/146


14/146


15/146


16/146


17/146

How Others Countries Have Grown

Country Years Rate of Growth of GDP %

Japan 1960-1970 10.5

South Koreas 1982-1991 9%

Taiwan 1980-1989 8


18/146

INDIA -Burden of Success

Management of poverty satisfactory

Can we manage prosperity?


19/146

Unbalanced Growth-Unstable Society(Growth in the Next Decade)

States Increase inGDP(%)

Increase inWorkingPopulation(15-59 years)

UP, Bihar andMP

10% 40%

Maharashtra,Gujarat, AndhraPradesh and

Tamil Nadu

45% 20%


20/146

Population Projections Indias LaggingStates

2001 2026

Millions

2051

Total Population

(Bihar+MP+UP+Orissa)

402.2 600.6 698.1

Total Populationas a % of Indias

Total

39.0 42.3 44.0

India Total 1,027 1,419 1,579


21/146

India-China

India and ChinaOr

India vs. China


22/146

India and China (Governance)World Bank Survey 2007

India above China Process of Govt.Selection

Rule of LawControl of Corruption

China above India Political StabilityGovt. EffectivenessRegulatory Quality


23/146

India - China By 2030 China and India together could account for as much

as a third of the Worlds economy China as the worlds manufacturing workshop and India as

its back office , descriptions that accurately reflects theirinteractions with the rest of the world

China has been growing at an average rate of 9% for the

last thirty years , Chinas economy has doubled in size nearlyfour times in that period

Indias growth surge is driven by entrepreneurs in ITservices and sophisticated, capital intensive techno-manufacturing, rather than by labour-intensive

manufacturing found in China

Source


24/146

India - China

India and China use 40% more capital to produceadditional unit of out put, than used by Japan ata similar stage of development

China-Total Goods traded ( Imports + exports)67% of GDP in 2006

India- Total Goods traded 33% of GDP in 2006

P l i d L b F


25/146

Population and Labour ForceChina and India

1990 2010 2020 2030

Population (millions)

China 1,142 1,267 1,354 1,462

India 862 1,214 1,367 1,485

World 5,290 6,909 7,674 8,308

Labour Force (age 15-59 millions)

China 721 918 923 874

India 483 749 868 962


26/146

Top Seven Companies India and China(By Market Capitalization-2009)

GlobalRank

Name IndustryOwner-ship

GlobalRank

Name IndustryOwner-ship

12 ICBC Banking S 121 Reliance Oil P

14 Petro ChinaOil S 150 State Bank Banking S

23 ChinaCons. Bank

Banking S 152 ONGC Oil S

30 Bank of

China

Banking S 207 Indian Oil Oil S

33 SinopeeChina Petro

Oil S 317 NTPC Power S

72 China Life

Ins.

insuranc

e

S 329 ICICI Banking P

139 China Tele S 463 Tata Steel Steel P


27/146

India wants to become a Global

Power

Before a becoming Regional Power


28/146

Our Neighbors- Friends or Foes?


29/146



30/146

India a Regional Power-?Some Historical Events

Sikkim an independent nation merges with India Maldives Govt. invites Indian defense forces to assist

during rebellion/coup India -Nepal defense Fought two wars with Pakistan-1965 and 1971 Attacked by China in 1962

India forces on request of Sri Lankan Govt. foughtagainst LTTE


31/146

South Asia Region

South Asia is the least integrated region in the world Intraregional trade is less than 2% of GDP,

compared two more than 20% of East Asia The cost of trading across the border is the highest

in the world Energy trade is low, only India, Bhutan and Nepal

trade electricity Only 7% international calls are regional, compared

to 71% for East Asia

( World Bank Report)


32/146

South Asia Region(Trade and Transport Facilitation in South Asia- World Bank)

International trade in South Asia is directed very largely outsidethe region. Intra-regional trade totals rather less than US$6billion, less than 5 percent of the regions overall trade.

In terms of imports, South Asia has the least intra-regionaltrade in the world, less than half the level of the next lowesttrading region (Middle East and North Africa).

Intra Region trade flow of selected Regions 2005

A few Regions Export to own Region%

Import from ownRegion %

SAARC 4.7 3.1

Middle East and NorthAfrica

2.2 6.6

East Asia & Pacific 19.1 16.5


33/146

South Asia Intraregional Trade as a %of total Trade

(Trade and Transport Facilitation in South Asia-World Bank)

Countries 1990 2005

Afghanistan 12.2 35.1

Bangladesh 6.7 9.1

India 1.3 1.9

Nepal 26.2 46.5

Pakistan 1.9 5.7


34/146


35/146

Indo- Nepal

Indo-Nepal Treaty Free cross border movements, relations and duty free

trade Nepalese in Indian army, and free to work India main trade partner, other country import by Nepal

passes thro Indian land and customs

Himalayan rivers flows into India Indias role during armed struggle


36/146

Indo-Bangladesh

India helped in liberation of Bangladesh Trade and transit treaty-India major trading partner, food,

coal, consumer goods

Border disputes Himalayan river flows into Bangladesh Rail, road and river trade Bdesh blocks access to North East, Tripura and Mizoram in

backyard Relations not stable, less goodwill


37/146

Indo-Sri Lanka

India Army with Sri Lankan forces fought against LTTE

Free tariff agreement allowing access of goods from SriLanka into India


38/146

Indo-Myanmar

Very old Army dictatorship-totally closed country to the world Except for the last decade India did not have any relation ship

with the country-No political, social, economic relations. No

open borders. Insurgents of North East made their bases in Myanmar Considered a failed state-poor, no industry, education Chinas increasing influence


39/146



40/146

India a Regional Power-?

Indias Image in the Region?

- Big brother not Elder Brother

- Big Bully

- A Big Country with Small Heart


41/146

North Eastern Region

Gate way to South East Asia

- but blocked


42/146

North Eastern Region Cut off from Mainland


43/146

Coal

Not Enough?

N h E R i


44/146

North East Region

At Independence, the North Eastern Region was among the most prosperous regions of India.

Now the Region is lagging far behind the rest of the country.

The trauma of partition in 1947 took the region backwards by at least a quarter of a century,and also placed hurdles on future economic progress.

The approach to the rest of India is through a narrow 27-km-wide Silliguri corridor, making ita remote land and constraining access for movement of goods and people.

Isolated region, sealed both land and sea routes for commerce and trade , and severedaccess to traditional markets and the gateway to the East and South-East Asia theChittagong port in East Bengal (now Bangladesh).

(North Eastern Region Vision 2020 Govt. of India) (Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland and Tripura)


45/146

North East Region

Over 200 ethnic groups with their own languages and socio-cultural

identity. The uneasy relationship with most of the neighboringcountries has not helped the cause of development of the region. 96 per cent of the borders of the North Eastern Region constitutes

international boundaries ,geo-political isolation of the region.

PopulationLakhs

Literacy rate(%) 2001

Per CapitaGSDP (Rs.)2004-05

ForestCoverage(%) 2003

NER States 389.84 68.5 18,032 54.52

India 10,287.37 64.8 25,944 23.57


46/146

North East Region

The carving out of East Pakistan from Bengal blocked thenatural sea route through the port city of Chittagong.

Access to the Chittagong port and opening up of the inlandwater route could lead to economic resurgence of the

region. In fact, the Chittagong port is only 75 km fromSabroom in Tripura and could become an important gatewayfor India to East Asian countries.

The construction of a bridge by India across the 110-metrewide Feni River, and helping Bangladesh modernize theChittagong port.


47/146

North East Region

Bangladesh could have access to Indian markets byenabling free trade in the land routes, which would

mitigate its unfavorable balance of trade with Indiaconsiderably. Taking the gas pipeline from Myanmar to Kolkata

through Bangladesh could enable the latter to earn

substantial amounts by charging transit fees.

NER A G th R t R i d


48/146

NER Average Growth Rates Requiredto Reach Indias Per Capita GDP Level

in 2019-20Growth rate of GSDP

2007-2012 2012-2017 2017-2020 2007-2020

North EasternStates

10.00 13.67 16.37 12.95

India 9.00 9.00 9.00 9.00

Growth Rate of Per Capita GSDP

North EasternStates

8.84 12.35 15.16 11.64

India 7.51 7.67 7.80 7.61

Note: GSDP is at fixed costs at 2006-07 pricesFrom: North Eastern Region Vision 2020 Min. of Dev. Of Northern Region and North Eastern

Council


49/146

North East Region

Where North East ends, South EastAsia begins.

A big market and source of rawmaterial is next door.


50/146

Indian Rivers

Unutilized Potential


51/146


52/146


53/146

Inland Water transport

Inland water transport,( IWT)rivers, canals, lakes,etc. and also overlapping coastal shipping in tidalrivers. Mechanized vessels, country boats of variouscapacities operates in various rivers and canals.

The waterway is naturally available, which has to betrained, maintained, and upgraded.

Constitutes 20% of the transport sector in Germany(WB 2005) and 32% in Bangladesh. In India it is lessthan 1% +

In water-based transport , environmental pollution islower than in transport by road, rail, or air.


54/146

Inland Water Transport

The cost of movement by this mode turned out to beRs.0.37 t/km when compared to Rs. 0.96 t/km by roadand Rs. 0.50 t/km by rail.

Cost of development of inland waterway has beenestimated to be a mere 5-10 percent of the cost of developing an equivalent 4-lane highway or railway.

Cost of maintenance of inland waterway is placed at

20 % of that of roads. Estimate that one litre of fuel can move 24 t/km of

freight by road, 85 by rail and 105 by IWT.

(Long Term Perspectives on Inland Water Transport in India BY Dr. S.Sriraman)


55/146

India has about 14,500 km of navigable waterways whichcomprise of rivers, canals, backwaters, creeks, etc. Cargo movement by the inland water mode in India was around

32.48 million tonnes in 2003-04 which increased to 55.82 milliontones in 2007-08. This constituted just about 0.34% of the totalinland cargo of about 1000 billion tons kms (IWAI, 2009).*

Restricted to a few stretches in the Ganga-Bhagirathi-Hooghlyrivers , the Brahmaputra, the Barak river, the rivers in Goa, thebackwaters in Kerala, inland waters in Mumbai and the deltaicregions of the Godavari - Krishna rivers.

+ (Viability of Inland Water Transport in India by Narayan Rangaraj and G. Raghuram) *Long Term Perspectiveson Inland Water Transport in India BY Dr. S.Sriraman

Inland Water Transport


56/146


57/146


58/146


59/146


60/146


61/146

Indias Food/AgriculturalScenario

Unbalanced Growth?


62/146

(Indian Council for Research on International Economic Relations: ICRIERDemand and Supply Trends and Projections of food in IndiaBy Surabhi MittalWorking Paper No-229)

(Indian Council for Research on International Economic Relations: ICRIERDemand and Supply Trends and Projections of food in India


63/146

Demand and Supply Trends and Projections of food in IndiaBy Surabhi Mittal

Working Paper No-229)

Trends in Total domestic production of food in India



64/146

By Surabhi MittalWorking Paper No-229)

Projected annual per capita domestic demand forselected food items

(Indian Council for Research on International Economic Relations: ICRIER


65/146

(Demand and Supply Trends and Projections of food in India By Surabhi Mittal

Working Paper No-229)

Trends in World production of food


By Surabhi Mittal


66/146


Projected domestic supply of selected food items inIndia



67/146

(Demand and Supply Trends and Projections of food in India


Projected domestic demand of food in India



68/146

(Demand and Supply Trends and Projections of food in India By Surabhi Mittal Working

Paper No-229)

Supply-Demand gap for selected food items

I di P d ti d I t f P l


69/146

India- Production and Import of Pulses2008-2010

Name of PulsesProduction

Import 2008-09 Import 2009-10

Lakh Tons Lakhs Tons

Value Rs.Crs.

Lakh Tons Value Rs.Crs.

Toor (Arhar) 25 3.85 1040.0 3.99 1700.0

Moong 10-11 4.27 1210.0 5.48 2490.0

Urad 11-12 1.11 280.0 3.61 1150.0

Red Lentils(Masoor)

10 0.28 130.0 2.35 880.0

Chick Peas(Gram)

70-75 2.15 520.0 3.15 800.0

Yellow Peas 4.0 13.38 3100.0 17.87 2790.0

Other(Rajma,Lobia,Moth Kabuli Chanaetc.)

14 0.53 180.0 0.79 2600.

Total 144-151 25.57 6460.0 37.24 10070.0


70/146

R gh E ti t f Edibl Oil I t


71/146

Rough Estimate of Edible Oil Importinto India

Oil Nov.07-Oct.08 (MT) Nov.08-Oct.09 (MT)

RBD Palm Oil 730794 1240018

Crude Palm Oil 4044063 5187063

Crude Sunflower Oil 26490 590175

Crude Degummed Soyabean Oil

759433 989613

Others* 47630 176491

TOTAL 5608410 8183360

Rough Price $850/MT C&F Rough Value of Import for Nov.08-Oct.09=32,000 Rs. Crores


72/146

Wheat Price Parity in Tamil Nadu

Indian Wheat from FCI under OMSS in Tamil Nadu:-

Rs. 14,000 PMT loaded on Trucks Australian Wheat CFR US$ 300

PMT=Rs.13950 + Rs. 1000 for loading on Trucks = Rs. 14000 PMT

Indian season in April where as Australianwheat season is December. Hence forshort period Australian wheat may be

cheaper.


73/146

Iron Ore(and other natural resources)

What About Socio-economicDimension of the Local

Population?


74/146


75/146


76/146


77/146


78/146

Wikipedia


79/146

p

f


80/146

Coal - Main Source of Energy

India is currently the third largest producer of coal in the world, with a production of about 407million tons (MT) of hard coal and 30 MT of lignitein 200506.

The existing power plants and the new plantsadded in the next 1015 years could consumemost of Indias extractable coal over the course of the plants estimated 40- to 50-year lifespan.


81/146


82/146


83/146

India to Reach the World

Our strategy- To make profit, and prosper?

Or To partner different countries in their

economic development

Indias Need to Reach the


84/146

World

India is energy deficient . High growth would requireglobal reach for meeting the demand

Also food deficient - would require reliable long termsourcing from other countriesAND

Export Market to grow with new products (Technomanufacturing)-requiring control over market andlogistics

Acquisitions for better utilization of Assets

But How Do We Reach The


85/146

World? Center of Gravity of Economic Activities Are Shifting What About Our Management Thoughts? Still Emphasis Towards Management Thinking Of

Western World

Japanese And Korean Developed Different Model ForGrowth

Where Is Our Model For International Business, as anInstrument of Economic Growth?

Are Managers Trained For Meeting Indias Need ? Need For Training And Research In Creation Of Global

Trading Corp. To Meet our Need

But How Do We Reach The


86/146

But How Do We Reach TheWorld?

Not Enough Research Work, Debate,Management Education In The Field Of:-

MNC For Trading

Finance Market Research Incubators Political, Diplomatic, Strategic and Social

Dimensions of Indian Large InstitutionsEntering Global Arena

resen us o eeSh t d L T


87/146

Short and Long TermNeeds

India Attracted US$ 23 billion FDI in 2007Invested abroad US$ 13.7 billion

Indian entrepreneurs have Brand and their business model inIndia is considered a successful one which they want to extend

beyond- Engineering, pharmaceuticals and ITSIndian Acquisitions a Few Ex:-

Tata Corus(Anglo Dutch steel firm) US$ 8 billionTata Motors Jaguars and Rovers from Ford Motors US$2.3 billion

India Inc. Global Outreach


88/146

India Inc. Global OutreachEnergy Hungry

NTPC- plans to acquire coal mines or form joint ventures (JVs) in Australia, Indonesia,Mozambique and South Africa. Aims to import 25-30 MiT. of coal, compared to 15 MiTnow, within next five years.

The Essar Group has acquired a coal mine in Indonesia. Sources said the acquisition,from an undisclosed local company, was for about Rs 900 crore.

ONGC and PetroVietnam to bid for BP assets in Vietnam. They already hold 45+20%stakes in BPs gas producing Co. PM Vietnam says India always supported Vietnam

since Nehru and Indira Gandhi. ( Eco. Times 23.7.10)

India Inc Global Outreach


89/146

India Inc. Global OutreachEnergy Hungry

Reliance Power has signed a share-saleagreement with Indonesias Sugico Group toacquire three coal mines

Jindal Steel and Power Ltd (JSPL) on announced

that it has completed the acquisition of Oman-based Shadeed Iron and Steel Co LLC (Shadeed).(US$464Mio.)

India Inc Global Outreach


90/146

India Inc. Global Outreach Indian companies are increasingly buying up companies abroad as

strategic acquisition, indicating the growing competitiveness of the

Indian corporate sector. Singapore, Mauritius, the US, British VirginIslands and Netherlands Of the total amount of investments, 70 percent was in the form of equity, and most of the remaining amountcomprised of loans,

The perception about Indian companies in the African countries

-they generate local employment and engage in local skillsdevelopment. Small and medium enterprises in sectors ranging from spices and

tea to chemicals are looking at entering the commercial agriculturespace in Africa. (RBI)

In the US in Jan-June10, acquired 23 companies valuing over $3.8billion. ( according to a report by New York-based advisory firm IMaCS Virtus Global Partners) .

India Inc. Global OutreachHunger for food agriculture


91/146

Hunger for food agriculture

Indian companies that already have a presence in Africaare looking at getting involved in the agricultural sector,even if they are not intrinsically farming majors. Thereare companies, which are doing large infrastructureprojects, that are offered land holdings usually on lease.

The Tata group has been given a land lease in Uganda torun a pilot agricultural project, while the Jaipurias of RJCorp have a lease of a 50-acre model dairy farm. Thelatter is already active in dairy products in African

markets such as Uganda and Kenya.



92/146


Shapoorji Pallonji & Co has acquired the lease for50,000 hectares of land in Ethiopia and may lookat agricultural projects in future.

There are roughly about 70 Indian companies

which are already in the process of making aforay into the farming sector in Africa . Thecountries which offer big opportunities includeEthiopia, Malawi, Kenya, Uganda, Liberia, Ghana,

Congo and Rwanda.



93/146


Karuturi, a Bangalore businessman who has been acquiring land in African nations, has alreadybecome the biggest rose grower in the world, and one of the worlds biggest private landowners.Also owns Karuturi Sports, a Kenyan football club (earlier called Sher Agencies) that plays in thecountrys premier league.

(Source: India Brand Equity Foundation www.ibef.org -Period of reporting March July10)
http://www.ibef.org/http://www.ibef.org/http://www.ibef.org/


94/146



95/146

Tea Plnations

BM Khaitan-owned McLeod Russel India, thelargest integrated tea company in the world , hasalready taken the acquisition route with UgandasRwenzori Tea Investments which it bought for $25million (Rs 117 cr).

BK BIRLA controlled Jay Shree Tea & Industries,which has recently acquired three tea gardens inEast Africa, two in Rwanda and one in Uganda, islooking at increasing its presence in Africa



96/146

Engineering Gemini Communication Chennai has acquired 100% stake in

Rosy Blue Wireless Africa (RBW) , a telecom and internet

service provider in Africa -strongly positioned to deliver 4thgeneration wireless network infrastructure to countries inAfrica.

Aditya Birla Groups, Ultra Tech acquired Dubai-based ETAStar Cement Company,- entry in markets -the United Arab

Emirates (UAE), Bahrain and Bangladesh. Crompton Greaves Ltd (CG), has acquired the UK-based

electrical engineering company Power Technology Solutionsfor around 30 million (Rs 204 crores).



97/146

Cosmetics Dabur is in advanced talks to buy Turkish

personnel care Company Hobi Kozmetik- its firstoverseas acquisition. The company wsa looking tobuy one mid size or two small sized companyevery year. (The Eco. Times 22.7.10)


98/146

The Last Frontier Africa

For Global Poverty Elimination

R h Af i


99/146

Reach Africa

India should source its Energy and Food requirementfrom African Countries- in the process African

Counties will develop

Reach Africa


100/146

Reach Africa

India should source its Energy and Foodrequirement from African Countries- in the

process African Counties will develop

Or

Help Africa in balanced economicdevelopment, in the process India shall meet

its Energy and Food requirement


101/146

Africa Development Indicators 2007Th W ld B k


102/146

The World Bank

Africa Development Indicators 2007The World Bank


103/146

The World Bank

Africa Development Indicators 2007The World Bank


104/146

The World Bank


105/146


106/146

'Fast economic growth' in Africa The economic outlook for Africa is improving after a decade of growth of 5.4%

for the continent that matches global rates, the World Bank has said. BBC News 14.11.2007

NaturalResources


107/146

Oil-

Diamond-Gold-Agriculture-

The World


108/146


109/146


110/146

MARKETS

AUSTRALIA, BDESH, BOTSWANA, ETHIOPIA, GUYANA , IRAN, NEPAL , MAURITIUS,MALDIVES, MYANMAR, SRI LANKA, SENEGAL, SURINAME, BRAZIL, TRINIDAD , PHILIPPINES,

S. KOREA, VIETNAM, ZAMBIA, ZIMBABWE.

Myanmar

Myanmar


111/146

Sl .no Description of Projects ValueUS $ 000

Clients

Year

1 Supply, Erection &Commissioning of Plant &Machinery for a PVC CableManufacturing Plant.

175 MyitmakhaEngineers Ltd.

1998

2 Supply, Erection &Commissioning of Plant &Machinery for Oxygen GasPlant capacity 100 cu.m/hour

380 Myanmar Tools &Electrical Industries

2000

3 Supply, Erection &Commissioning of Plant &Machinery for Acetylene GasPlant

90 Myanmar Tools &Electrical Industries

2000

Myanmar

Myanmar
http://images.google.co.in/imgres?imgurl=http://www.ajaypoly.com/JPG/SHAKE.jpg&imgrefurl=http://www.ajaypoly.com/collaboration.htm&h=182&w=307&sz=8&tbnid=xcvnTku5E7V5iM:&tbnh=66&tbnw=112&hl=en&start=1&prev=/images?q=technical+tie+up&svnum=10&hl=en&lr=&rls=GGLG,GGLG:2006-21,GGLG:en


112/146

Sl .no Description of Projects Value US

$ 000Clients

Year

4 Supply, Erection &Commissioning of Plant &Machinery for IndustrialFasteners Unit

430 Myanmar Tools &ElectricalIndustries

2000

5 Supply, Erection &Commissioning of Plant& Machinery for LPGCylinder Manufacturing

Unit

1,100 Myanmar Tools &ElectricalIndustries

2001

6 Supply, Erection &Commissioning of TextileProcessing plant

1,000 Myanmar TextileIndustries

2002

AsiaThe World
http://../Pec.ppthttp://../Pec.ppthttp://images.google.co.in/imgres?imgurl=http://www.ajaypoly.com/JPG/SHAKE.jpg&imgrefurl=http://www.ajaypoly.com/collaboration.htm&h=182&w=307&sz=8&tbnid=xcvnTku5E7V5iM:&tbnh=66&tbnw=112&hl=en&start=1&prev=/images?q=technical+tie+up&svnum=10&hl=en&lr=&rls=GGLG,GGLG:2006-21,GGLG:en


113/146

Case Study : Suriname


114/146

114

y

PROMOTION ACTIVITIES :

PEC Started Exploring in Suriname as a potential market in late 90s.

(March 2002) a buyer seller meet organized by EEPC gave an insight of the market and the potential was noted.

Identification of Market : For the Supply of Electrical Transmission,Distribution and Sub-station equipments, mini hydel power station etc..

PEC Successfully Captured First Market for Supply of 160 Distribution

Transformers value at USD 0.40 million from the National Power Utility

Company (Dutch companies were the traditional suppliers)

PROMOTION ACTIVITIES :

PEC got Further Order for the supply of 240 Transformer valued of USD0.55million and Supply of Some Electrical Items of US$ 0.28 million

USD 12.89 m, 161 KV, 30 km Transmission Line project in associationwith L&T.

Other Products:


115/146

115

Distribution Transformers, Electrical Transmission Mini Hydel Power Stations

Salient Features : 30 Km, 161 KV Transmission line Project

Comparable Quality at 20% less price. (10% savings in transmission losses.)

Chinese prices were cheaper but our quality was superior.

Political/ Diplomatic pressures from both India and China.

First Project in India where the entire cost has been covered under soft loan.

Majority of supplies from India (included some equipment from USA/ Columbia/Europe)

At one point of time 130 trained personnel from India on site (inadequate local skills)

Difficult Marshy Conditions and heavy rainfall.

Single Biggest Project in Suriname- Indian Technical prowess.

L&T first project. Got more projects there.

Suriname

Suriname


116/146

Sl .no Description of Projects Value US$ 000

Clients

Year

1

Distribution Transformer 406 N.V. EnergiesBedrijven Suriname

2002

2 Line Hardware

8

N.V. EnergiesBedrijven Suriname

2003

3

Line Hardware17 N.V. Energies

Bedrijven Suriname2003

4 Line Hardware 13


2003

Suriname

Suriname


117/146

Sl .no Description of Projects Value US$ 000

Clients

Year

4

Line Hardware

49


2003

5ACSR Conductor 141 N.V. Energies

Bedrijven Suriname2003

6 Line Hardware 32 N.V. EnergiesBedrijven Suriname 2003


118/146


119/146


120/146

A Dinner Hosted by the Honorable President of India in Honorof H.E. Mr. Runaldo Ronald Venetiaan, President of the


121/146

Republic of Suriname and Mrs. L.A.M. Venetiaan-Venenburg

So How Emerging India Will Look Like


122/146

g g W

I Wish I Had The Picture

But The Land Route Should Look Like..


123/146


124/146

India Will it Survive


125/146

Ramachandra Guha argues:-


126/146

Thanks

New Business


127/146

127

Year New Countries

02-03 Brazil, Morocco, Ghana, Philippines.

03-04 Suriname, Trinidad &Tobago, Syria, Iran

04-05 Tanzania, Yemen, Bhutan, UAE, Madagascar.

05-06 Sierra Leone, Senegal, Malawi, Timor leste, Grenada.

06-07 Benin, Myanmar, Mozambique.


128/146

Electrical Equipments Business Activities


129/146

129

Bangladesh

5,595Morocco14

3,046,643Mauritius13

165,125Kuwait12

80,.000Kenya11

4,000,654Jordan10

12,708,581Iran9

73,250Indonesia8

25,182,462India71,021,906Hong Kong6

3,817,792Ethiopia5

9,412,792Dubai4

45,750Burma3

2,311,215Bhutan267,735,2881

Value US $CountryS.no

Value US $CountryS.no

Electrical Equipments Business Activities


130/146

130

11,046,689Zimbabwe28

169,211,806TOTAL

1,495,205Uganda26

11,046,689Vietnam27

427,141Trinidad25

1,100,837Tanzania24

857,218Syria23

14,107,216Suriname22141,290Sudan21

3,400,146Sri lanka20

9,375Singapore19

340,000Saudi Arab18

465,903Philippines1780,000Nigeria16

372,278Nepal15

$y

Equipment, Defence & Manufactured GoodsEq

uipment, Defence & Manufactured Goods


131/146

131

Conductor/Hardware Pumps & Compressors

Transformers Electric Motors

Switchgears Boilers

Buses, Trucks & Trailers Fuel Dispensing Units

Tractors Earth Moving Equipment.

Agricultural Implements Defence Stores

Railway Equipment Medical Equipment

Machine Tools Pharmaceuticals

Steel Products Family Planning Devices

PROJECTSPROJECTS


132/146

132

Textile Factories Industrial Fasteners Plant Tea Factories Food Processing Unit Pollution Control Units Cement Plant

Wheat Flour Mill

Sugar Factories Paper Plants

Electrical Transmission Line& Sub-station

LPG Cylinder Plant Oxygen / Acetylene Plant

Paddy Mill Civil Construction

Industrial Plants & MachineryIndustrial Plants & Machinery

Business in New Product New Market is almost50% of the business in Engg sector


133/146

133

50% of the business in Engg. sector

40

4542

4746

60

33

0

10

20

30

40

50

60

70

98-99 99-00 00-01 2001-02 2002-03 2003-04 2004-05 2005-06

year

% o

f E n g g

E x p o

NC+NP

Case Study : Morocco


134/146

134

Export : Morocco exports Rock Phosphate to India.

Import : Morocco is planning to try India as a new source of Engg. goods. Initiatives : Officials from PEC visited Morocco and met with M/s Groupie Office

Cherifien Des Phosphates (OCP).

Traditionally OCP use to purchase goods from France and other Countries

following French (NF) standards. PEC tried to develop products where India enjoy aCompetitive edge such as Rollers, Idlers, Conveyors Belts, Wires Ropes andFasteners etc..

The First Sample was submitted by PEC in July 2000, which failed on the NFstandards and buyer need for some more improvement on products.

PEC Communicated with Manufacturer about further improvement and thesecond sample was submitted on Oct 2000.


135/146

135

Even then Sample did not meet the requirements.

PEC again coordinated with associates and fresh test sample was submitted tocustomer and it got approval in DEC 2000.

PEC able to enter the Market with a small order of US$ 30,000/- approx

in Oct 2001 and several repeat orders thereafter.

Repeat order of the same material- Business deal of Rs 2.5 Cr in July 2003.

This made PEC to Successfully capture the New Market for New Product.

Withdrew after initial success, the returns were less than the efforts involved.

However, it opened doors for Indian Manufacturers.


136/146

Bangladesh

Bangladesh


137/146

Sl.no

Description of Projects ValueUS $ 000

Clients

Year

1 Supply, Erection &Commissioning of spinning Millof capacity 25000 spindles atKohinoor Spinning Mills

2,487 Bangladesh Textile

Mills Corporation

1978

2 Supply, Erection &Commissioning of Spinning Millof capacity 25000 spindles atRajshahi Textile Mills

3,468 Bangladesh TextileMills Corporation

1978

3

Supply, Erection &Commissioning of Spinning Millof capacity 25000 spindles atDinajpur Textile Mills


1978

Bangladesh

Bangladesh
http://images.google.co.in/imgres?imgurl=http://wdf2006.blogspirit.com/images/medium_125px-flag_of_bangladesh.svg.png&imgrefurl=http://wdf2006.blogspirit.com/archive/2006/02/index.html&h=75&w=125&sz=2&hl=en&start=11&tbnid=CdslAW_8lebVwM:&tbnh=54&tbnw=90&prev=/images?q=flag+of+bangladesh+2006&ndsp=20&svnum=10&hl=en&lr=&sa=Nhttp://images.google.co.in/imgres?imgurl=http://www.ajaypoly.com/JPG/SHAKE.jpg&imgrefurl=http://www.ajaypoly.com/collaboration.htm&h=182&w=307&sz=8&tbnid=xcvnTku5E7V5iM:&tbnh=66&tbnw=112&hl=en&start=1&prev=/images?q=technical+tie+up&svnum=10&hl=en&lr=&rls=GGLG,GGLG:2006-21,GGLG:en


138/146

Sl .no Description of Projects Value

US $ 000Clients

Year

4 Supply, Erection &Commissioning of various Plant& Machinery for 8 TextilesMills


1978

5 Supply, Erection &Commissioning of 70 TPDBoilers

2,700 BangladeshChemical IndustriesCorpn.

1983

6 Balancing, Modernization,Rehabilitation & Expansion of North Bengal paper Mill

4,140 BangladeshChemical IndustriesCorpn

1989

Bangladesh

Bangladesh
http://images.google.co.in/imgres?imgurl=http://wdf2006.blogspirit.com/images/medium_125px-flag_of_bangladesh.svg.png&imgrefurl=http://wdf2006.blogspirit.com/archive/2006/02/index.html&h=75&w=125&sz=2&hl=en&start=11&tbnid=CdslAW_8lebVwM:&tbnh=54&tbnw=90&prev=/images?q=flag+of+bangladesh+2006&ndsp=20&svnum=10&hl=en&lr=&sa=Nhttp://images.google.co.in/imgres?imgurl=http://www.ajaypoly.com/JPG/SHAKE.jpg&imgrefurl=http://www.ajaypoly.com/collaboration.htm&h=182&w=307&sz=8&tbnid=xcvnTku5E7V5iM:&tbnh=66&tbnw=112&hl=en&start=1&prev=/images?q=technical+tie+up&svnum=10&hl=en&lr=&rls=GGLG,GGLG:2006-21,GGLG:en


139/146

The World

Sl .no Description of Projects Value

US $ 000Clients

Year

7 Balancing, Modernization &Rehabilitation of 3 Sugar Mills

5,200 Bangladesh Sugar Industries & FoodCorporation

1993

8 Supply, Erection &Commissioning of Equipmentfor INSAT Based Satellite MDDReception System.

140 BangladeshMeteorologicalDepartment

2000

9 Design, Supply, Erection &Commissioning of Plant &Machinery for 200 TPD CementGrinding Unit

288 Karim Cement Ltd. 2001

Asia
http://../Pec.ppthttp://images.google.co.in/imgres?imgurl=http://wdf2006.blogspirit.com/images/medium_125px-flag_of_bangladesh.svg.png&imgrefurl=http://wdf2006.blogspirit.com/archive/2006/02/index.html&h=75&w=125&sz=2&hl=en&start=11&tbnid=CdslAW_8lebVwM:&tbnh=54&tbnw=90&prev=/images?q=flag+of+bangladesh+2006&ndsp=20&svnum=10&hl=en&lr=&sa=Nhttp://images.google.co.in/imgres?imgurl=http://www.ajaypoly.com/JPG/SHAKE.jpg&imgrefurl=http://www.ajaypoly.com/collaboration.htm&h=182&w=307&sz=8&tbnid=xcvnTku5E7V5iM:&tbnh=66&tbnw=112&hl=en&start=1&prev=/images?q=technical+tie+up&svnum=10&hl=en&lr=&rls=GGLG,GGLG:2006-21,GGLG:enhttp://../Pec.ppt


140/146


141/146


142/146


143/146


144/146


145/146

5 0 0 0

6 0 0 0


146/146

Turnover(Rs.Cr.)

0

1 0 0 0

2 0 0 0

3 0 0 0

4 0 0 0

1 9 8 0

- 8 1

1 9 8 2

- 8 3

1 9 8 4

- 8 5

1 9 8 6

- 8 7

1 9 8 8

- 8 9

1 9 9 0

- 9 1

1 9 9 2

- 9 3

1 9 9 4

- 9 5

1 9 9 6

- 9 7

1 9 9 8

- 9 9

2 0 0 0

- 0 1

2 0 0 2

- 0 3

Documents

International Economy MS 97-2003 09082010