BRIEF OVERVIEW OF IMPORTANT INDUSTRY

Agriculture
India is the second-largest producer of food in the world and holds the potential of being the biggest on global food and agriculture canvas, according to a Corporate Catalyst India (CCI) survey. The food processing industry is one of the largest in India ranking fifth in terms of production, consumption, export and expected growth. The Indian food industry is projected to reach US$ 300 billion by 2015. Agriculture sector is vital for the nation and is the principal source of livelihood for more than 58 per cent of the population. The growth of the agriculture and allied sectors is expected to be around 5.4 per cent during 2010-11, according to the Economic Survey 2010-11. India targets to achieve 9.5 per cent average economic growth in the 12th Five Year Plan (2012-17), on back of an estimated agriculture growth rate of 4.2 per cent. The growth target for agriculture for the 12th Five Year Plan was announced by Abhijit Sen, a member of the Planning Commission. The Commission expected the growth in the Indian agriculture sector to touch 3.5 per cent during the Eleventh Five Year Plan (2007-2012), as against 2 per cent in the previous Plan Period, according to Mr Montek Singh Ahluwalia, Deputy Chairman of the Planning Commission.

PRODUCTION
Food grain production has reached a record level of 241.6 million tonne (MT) in 201011. We have also achieved the highest ever production of wheat, pulses, oil seeds and cotton. Overall farm output has also achieved an impressive growth rate of 7.5 per cent during the last quarter of 2010-11 thus helping agriculture gross domestic product (GDP) to register a growth of 6.6 per cent during the year, as per Mr Sharad

Pawar, Agriculture and Food Processing Industries Minister. The Planning Commission maintains a projected demand of 247 MT by 2020. According to statistics 34,178,963 tonne rice has been procured by various Government agencies India's sugar production could increase to 25 MT in the 2011-12 marketing season (October-September), brightening the export prospects of the sweetener, as per Mr K V Thomas, the Food Minister. Favorable weather during the growing season in major potato producing states during 2010-11 resulted in about 13 per cent increase in production, from nearly 36 MT in 2009-10 to more than 40 MT in 2010-11. Highlighting the virtues of protected cultivation to boost horticulture productivity, a Rs 30,000 crore (US$ 6.07 billion) outlay has been proposed for bringing at least 10 per cent of the horticulture crop area in India under this high tech cultivation practice in the 12th Five Year Plan (2012-2017). An area of 21 million hectares is under horticulture in India and contributes over 230 MT to the food basket of the country.

Exports
India is among the 15 leading exporters of agricultural products in the world. Fruits and vegetables together constitute about 92.3 per cent of the total horticultural production in the country. India is the second largest producer of fruits in the world; it is the largest producer of fruits like mango, banana, papaya, sapota, pomegranate and Aonla. About 40 per cent of the worlds mangoes and 30 per cent of the worlds bananas and papayas are produced in India. In terms of productivity of grapes, India ranks first in the world. India is the second largest producer of vegetables and is a leader in the production of peas and okra. Besides, India occupies the second position in the production of

brinjal, cabbage, cauliflower and onion and third position in potato and tomato in the world. India is Burmas fifth largest trading partner, and it exports more than 1 MT of beans annually. India is looking for ways to invest in Burmas agriculture and energy sectors. India has already begun exporting 300,000 tonnes of rice to Bangladesh on government-to-government account at Rs 20,000 (US$ 404.85) a tonne from September 2011. The exports will be from the 3,000,000 tonnes of non-basmati rice permitted by the Centre on the heels of record production in wheat and bulging buffer stocks. India's coffee exports rose by 42 per cent to record 360,540 tonnes in the 2010-11 coffee year ended September 2011, according to a report by the International Coffee Organisation (ICO).

INVESTMENTS
The agriculture services attracted foreign direct investment (FDI) worth US$ 1.42 billion between April 2000 to August 2011, according to data released by the Department of Industrial Policy and Promotion (DIPP).

The World Bank has approved a US$ 250 million credit and loan to the West Bengal Accelerated Development of Minor Irrigation Project (ADMIP) for augmenting agricultural production of small and marginal farmers. Irrigation will continue to be critical to increasing farm production, income and rural livelihood, according to Mr Roberto Zagha, Country Director for India, the World Bank. The Bank study establishes that irrigation has a strong and significant impact on land productivity, cropping intensity and land prices

Foreign investors' are showing interest in fertiliser makers such as Chambal Fertilisers, Coromandel International and Rallis among others, due to decontrol of phosphatic and complex fertiliser prices. "Good monsoons this year, has

resulted in strong demand," as per Tarun Surana, Research Analyst, Sunidhi Securities

Organic farming has become a promising method of agriculture and is gaining global recognition. La Via Campesina is an international farmers' organisation, having its presence in more than 70 countries. The aim of the organisation is to provide technical, financial support to local and national farmers' organisations across the world, which includes promoting agriculture activities such as organic and natural farming

Karuturi Global, the city-based publicly-held floriculture major and one of the worlds largest exporter of roses which is aggressively rolling out an agriculture business venture in Ethiopia, is looking at outsourcing 20,000 hectares of farm land in the African nation to Indian farmers on a revenue-sharing basis. The company hopes to get 35 per cent of its revenues from the agriculture business in the next couple of years

Pune is witnessing a new trend where farmers are approaching consumers directly with their produce. Farmers have adopted a direct-to-home model that will enable people to buy online as well as from outlets

Cargill India Private Ltd, best known for its edible oil brand Nature Fresh, is planning to expand its packaged-food portfolio in the country

Government Initiatives The Union Government is setting up a National Centre for Food Technology in Haryana with a regional centre likely to be located in Hyderabad, as part of initiatives under the National Mission for Food Processing. In the Union Budget 2011-12, Mr Pranab Mukherjee, the Finance Minister made the following announcements for the agriculture sector:

Expenditure worth US$ 65.1 million to promote 60,000 pulses villages in rain fed areas for increasing crop productivity and strengthening market linkages Proposal to spend US$ 65.1 million to promote oil palm plantation in 60,000

hectares and US$ 65.1 million for the initiative on vegetable cluster

A proposal to spend US$ 86.8 million, to improve rice based cropping system in the Eastern Region

Furthermore, the Government plans to set up 15 new mega food park projects under the infrastructure development scheme with a total grant of Rs 787.50 crore (US$ 159.41 million). This is in addition to the 15 on-going projects. The Cabinet Committee on Economic Affairs (CCEA) has approved the 15 mega food projects, which will create infrastructure that would enhance the efficiency of supply chain from farm gate to retail outlets. Each project is expected to entail an investment of about Rs 100 crore (US$ 20.24 million) in common facilities and will leverage an additional investment of Rs 250 crore (US$ 50.59 million), the Government said in a statement. Each park is expected to benefit about 6,000 farmers directly and will indirectly benefit 25,000 to 30,000 farmers. Each mega food park will generate about 40,000 direct and indirect jobs, the statement further added. The banks have disbursed agriculture loans worth about Rs 446,779 crore (US$ 90.44 billion) as against the target of Rs 375,000 crore (US$ 75.91 billion) fixed by the Government for lending to Agriculture sector in 2010-11. In September 2011, bank disbursements to agriculture and allied activities went up by 7.9 per cent to Rs 433,000 crore (US$ 87.65 billion). The National Bank for Agriculture and Rural Development (Nabard) has sanctioned Rs 42.12 crore (US$ 8.53 million) to Karnataka State Warehousing Corporation to increase food grain storage capacity. The new line of credit is given to the corporation through Nabard Infrastructure Development Assistance (NIDA) for creation of 131,000 tonnes storage capacity spread over 10 districts.

The Centre has approved Rs 47.21 crore (US$ 9.56 million) as subsidy for Punjab under National Food Security Mission (NFSM) for wheat and pulses to boost their output. The Ministry of Agriculture has sanctioned funds to the tune of Rs 38.39 crore (US$ 7.77 million) for wheat and Rs 8.82 crore (US$ 1.78 million) for pulses for the 2011-12, a senior official of Punjab Agriculture Department said. In order to give 20 million farmers, farming information, weather and climatic details to help them meet agricultural targets, it has been decided to cover it through SMSs and the Integrated Voice Response System (IVRS) by 2017."The SMS and IVRS mode were launched in 2009 covering 5,000 farmers. It now covers 2.8 million growers and by 2017 the method would cover 20 million," as per Mr N Chattopadhayay, Deputy Director General, India Meteorological Department (IMD). India is keen to forge partnerships with the Association of South-East Asian Nations (ASEAN) countries for the exchange of technology to enhance farm productivity and address the impact of climate change on agriculture. Mr Sharad Pawar, the Agriculture Minister attended a meeting of ASEAN agri ministers in Indonesia's capital, Jakarta. This was the first-ever joint meeting of the agriculture ministers of SouthEast Asian countries and was aimed at fostering cooperation in the vital sector. Indian scientists have joined 16 other nations - the US, the UK, France, Italy, Switzerland, Germany, Czech Republic, Norway, Israel, Turkey, Russia, China, Japan, Australia and Argentina - in the initiative. The department of biotechnology (DBT) has sanctioned about Rs 34 crore (US$ 6.88 million) for over four years to three institutes - Punjab Agriculture University, ICAR and Delhi University - for the project."The project is likely to be completed in five years. But, we will crack the code within three years," as per Prof Nagendra Kumar Singh from ICAR's National Research Centre on Plant Biotechnology in New Delhi said. Agri-scientists are working on hybrid varieties of fruits like mango, grape and lemon to increase their productivity to meet the increasing demand. Indian Agriculture Research Institute (IARI) scientists are working on hybrid versions of different mango

varieties The Government of Indias focus in the 12th Five Year Plan will be mechanisation of agriculture to match the growing need for higher production of food grain and to tackle labor shortages in the farm sector. The Government has taken many policy initiatives and Missions to strengthen the farm credit delivery system for providing credit at affordable rates of interest to support the resource requirements of the agricultural sector. The emphasis of these initiatives is to provide timely and adequate credit support to farmers with particular focus on small and marginal farmers. The initiatives strive to enable and motivate the farmers to adopt modern technology and improved agricultural practices for increasing agricultural production and productivity.

TOURISM AND HOSPITALITY

"For India, the broad trends for 2012 are strikingly similar to the US. Around 53 per cent of Indian travellers claimed they travelled more in 2012, with 20 per cent more travellers planning to take an international holiday. Also, 44 per cent of Indian travellers are looking at spending more on their holidays in 2012 than last year", Stephen Kaufer co-founded TripAdvisor. Growth Trends Ministry of Tourism compiles monthly estimates of Foreign Tourist Arrivals (FTAs) and Foreign Exchange Earnings (FEE) from tourism on the basis of data received from major airports. Following are the important highlights regarding FTAs and FEE from tourism in India for the year 2011. Foreign Tourist Arrivals (FTAs):

FTAs during the Month of December 2011 was 715,000 as compared to FTAs of

680,000 during the month of December 2010 and 616,000 in December 2009

There has been a growth of 5.2 per cent in December 2011 over December 2010 as compared to a growth of 10.4 per cent registered in December 2010 over December 2009

The growth rate of 5.2 per cent in December 2011 is higher than 4.7 per cent growth rate observed in November, 2011 FTAs in India during 2011 were 6.29 million with a growth of 8.9 per cent, as compared to the FTAs of 5.78 million with a growth of 11.8 per cent during the year 2010 over 2009

The growth rate of 8.9 per cent in 2011 for India is better than UNWTOs projected growth rate of 4 per cent to 5 per cent for the world in 2011 and 7 per cent to 9 per cent for Asia and the Pacific

Investment Trends India's growth story still seems very credible to global corporations looking to grow beyond their borders. The world's largest hotel chain Best Western International Inc, USA, has taken up new strategies to expand its presence in the country in the hospitality sector. "If you look at the rates charged at the five or six-star luxury hotels, you can say that India is among the most expensive in the world. But if you look at the mid-scale and up-scale hospitality segments, India is quite affordable. I think growth is going to come from tier-2 and tier-3 cities. The 45 cities of India that have more than a million population have the most growth potential in the hospitality sector and we will perform best in these emerging markets, David T Kong, president and CEO, Best Western International Inc. Following the success of religious and medical tourism in India, the domestic travel industry is seeing a surge in a new set of tourists: Executives who travel to upgrade their skills while on a holiday in the country.

Mr Iqbal Mulla, President, Travel Agents' Association of India says that there has been a rise in the number of corporate houses sending their executives, especially midlevel and above, to India for management programmes offered by top B-schools, chiefly because it means huge cost savings for them. The courses and accommodation charges are 50-60 per cent less in India, and the courses offered are on par with those offered by universities in the US and Europe. The educational tourism sector in India is gaining ground due to the cost-effectiveness of courses and for offering higher level of training standards, agrees Mr Ravi Kaklasaria, Director, SpringPeople Software Pvt Ltd. Starwood Hotels & Resorts plans to open 20 new Hotels across all its brands by 2015. The company which is the largest operator of four and five star hotels in India currently operates 33 hotels in the country under management contracts. The hotel chain also plans to launch its brands W and St. Regis in the country in the next three to four years. With the debut of the W and St. Regis brands, Starwood will fly eight of its nine brand flags in India including W, St. Regis, The Luxury Collection, Le Meridien, Westin, Sheraton, and Four Points by Sheraton and Aloft. Taj group of hotels will be opening its doors in Yunnan Province of China. The Indian Hotels Company Ltd on Monday signed a memorandum of co-operation for a joint venture with Yunnan Tourism Co Ltd to engage in the development, construction, operation and management of two hotels in Kunming Expo Garden situated in Yunnan province. Taj already has management contracts in place for the Taj Temple of Heaven, Beijing. Besides, Taj will also manage a 300-room key luxury resort in Hainan Island. Government Initiatives According to the Consolidated FDI Policy, released by DIPP, Ministry of Commerce and Industry, Government of India, the government has allowed 100 per cent foreign investment under the automatic route in the hotel and tourism related industry. The terms hotel includes restaurants, beach resorts and other tourism complexes

providing accommodation and /or catering and food facilities to tourists. The term tourism related industry includes:

Travel agencies, tour operating agencies and tourist transport operating agencies Units providing facilities for cultural, adventure and wildlife experience to tourists Surface, air and water transport facilities for tourists Convention/seminar units and organisations The Government of India has announced a scheme of granting Tourist Visa on Arrival (T-VoA) for the citizens of Finland, Japan, Luxembourg, New Zealand and Singapore. The scheme is valid for citizens of the above mentioned countries planning to visit India on single entry strictly for the purpose of tourism and for a short period of upto a maximum of 30 days. During the period January - October 2010, a total number of 5016 VoAs were issued under this Scheme

The state government aims to generate 200,000 jobs in the tourism sector in the next five years. The master plan is aimed at making Karnataka the number one destination for tourism in the country by 2020, according to Mr G Janardhan Reddy, Minister for Tourism and Infrastructure Development

The Ministry of Tourism has won a PATA Grand Award and two PATA Gold Awards during the Pacific Asia Travel Association (PATA) Travel Mart 2010 in Macau. The PATA Grand Award was given under the Heritage category for the Rural Tourism Project at Hodka village in Kutch District of Gujarat. Strong growth in the services industry in the past few years has led to increased corporate spending on business travel in the country. Also, the increasing rate of income and affordability has enhanced the domestic leisure travel in the country. Even, there has been an increment in the foreign tourist visiting India proving the country to be a favoured tourist destination for leisure, as well as business travel

across the globe. With well-equipped infrastructure and the low cost, compared to developed countries has paved Indias way to be a nation growing fast to gain the status of one of the most preferred tourist destinations in the world.

EDUCATION AND TRAINING

With a growth rate of 10 to 15 per cent expected over the next decade, the Indian education market has witnessed a series of developments and changes in the last few years, which has resulted in a significant increase in the market size of the education industry compared to previous years. With a combined market size of US$ 50 billion per annum with more than 450 million students, and investment requirement of approximately US$ 100 billion by 2014 to meet growing demands of the sector, education industry is one of the largest service sector industries in India. Market Size The education industry in India can be broadly classified into the Regulated segment (K12 and higher education) and the Un-regulated segment (pre-school, multimedia, ICT, coaching cases, vocational training and books). The expected market size of K-12 sector in 2012 (E) is US$ 34 billion, with a rise of 14 per cent as compared to US$ 20 billion in 2008. The corresponding figures for the higher education sector are US$ 10.3 billion in 2012 (E) with a rise of 12 per cent as compared to US$ 6.5 billion in 2008. The coaching institutes in India will witness a 17 per cent increase from US$ 0.3 billion in 2008 to US$ 0.6 billion in 2012 (E). Similarly, the Pre-schools market in the country will witness a rise of 36 per cent from US$ 0.3 billion to US$ 1 billion and the vocational training from US$ 1.6 billion to US$ 4 billion in 2012 (E). "The Indian pre-school market is set to become the largest in the world. In India, the pre-school segment is currently worth US$ 750 million and is expected to reach US$ 1 billion by 2012," as told by Arun Arora, Chairman,Serra International Pre-Schools.

Private Equity (PE) Investments The Private equity and venture capital investors have pumped US$ 93 million into 10 education companies by July 2011, and are bullish about the sector's prospects going forward according to Venture Intelligence. PE investment in the education sector increased from US$ 129 million in 2009 to US$ 183 million in 2010. The other large deals in the country include PremjiInvest's US$ 43 million investment in Manipal Education and India Equity Partners' US$ 37 million investment in IL&FS Education and Technology Services. Government Initiatives/Policies

For the year 2012-13, Rs 25,555 crore (US$ 4.98 billion) have been allotted for RTE-SSA (Right to Education - Sarva Shiksha Abhiyan) which represents an increase of 21.7 per cent over the previous year allotment in 2011-12

6,000 schools have been proposed to be set up at block level as model schools in the Twelfth Five Year Plan (2012-17) Rs 3,124 crore (US$ 0.61 billion) have been provided for the RMSA (Rashtriya Madhyamik Shiksha Abhiyan) which is an increase of 29 per cent over BE 201112

In order to ensure a better flow of credit to students, a Credit Guarantee Fund has been proposed

Skill Development

National Skill Development Corporation has approved projects that are expected to train 6.2 crore people at the end of 10 years The National Skill Development Fund has been allocated Rs 1,000 crore (US$ 0.19 billion) for the period 2012-13 To improve the flow of institutional credit for skill development, a separate Credit Guarantee Fund will be set up "Himayat" scheme introduced in Jammu and Kashmir (J&K) to provide skill

training to 100,000 youth during the next 5 years and the entire cost will be borne by the Government of India Major Investments and Key Developments

Chicago-based Encyclopedia Britannica intends to launch online learning and knowledge products in India. The Indian market, in which Encyclopedia Britannica has been present for 12 years, accounted for about five per cent of the company's global print sales. Britannica has sold around 1,100 of each edition in the country over the past 30 months.

The Indian Institute of Management Kozhikode (IIM-K) has signed an agreement of co-operation with Leeds University Business School, UK to promote the internationalisation of efforts by the institute. The project intends to enable both the institutions to carry out activities such as exchange of students, exchange of faculty members and collaborative research on contemporary management issues.

India developed Intel Future Scientist programme that aims to sustain the innovative streak in students, has been launched by the global chip maker, Intel Inc. The programme will provide support to teachers in transforming the method of teaching science and math subjects. The focus of the initiative is to help science teachers present their curricula from an inquiry-based perspective to help foster a spirit of research and innovation among their students.

India's growing Rs 350 crore (US$ 68.33 million) executive education space continues to attract B-schools. US-headquartered Harvard Business School (HBS) will offer executive programmes at the TajLands End, at Bandra, in suburban Mumbai. The Wharton School of Business, University of Pennsylvania, will also set up its own centre in India. University of Chicago, Tuck School of Business, INSEAD, Oxford University's Said Business School and Duke University are among others, to offer their executive education programmes in India.

Technology-based education solutions provider Core Technologies will set up 150 skill development centres across the country. With an investment of Rs 450

crore (US$ 87.86 million), these training centres will offer vocational training across disciplines such as automobile, construction, hospitality, retail, IT and IT-enabled services.

IIHT Ltd, a technology-training organisation, along with Microsoft, has announced the launch of a certified cloud expert programme at Kochi Infopark. The programme would help information technology (IT) professionals acquire the necessary skills to develop into cloud professionals.

With the focus on the Indian education sector, an increase in allocation for Right to Education - Sarva Shiksha Abhiyan and Rashtriya Madhyamik Shiksha Abhiyan reiterates the Government's commitment towards education. The increase in budgetary allocations for school education and adult literacy is also a welcome step for the future of the Indian education sector.

Automobiles
Indian Automobile Industry: India is the world's second fastest growing auto market and boasts of the sixth largest automobile industry after China, the US, Germany, Japan and Brazil. According to Vikas Sehgal, Global Head of automotive industry, Rothschild, the Indian automobile market, which includes cars, trucks and auto parts, is pegged at 3.5 million units by the end of 2011-12. Rothschild is a UK-based global financial advisory firm. India's car market is evolving at a great pace. A car is not only a utility, but also represents aspirations and image of its owner. Hence, auto giants across the globe are leaving no stone unturned to attract Indian consumers by offering luxury, value, utility and convenience in their products. Key developments, initiatives, investments et al pertaining to the sector are discussed

below. Market Dynamics Indian domestic passenger vehicle market is increasingly getting dominated by smaller cars. For the quarter ended December 2011, Maruti Suzuki India Ltd held a share of 34.3 per cent in domestic passenger vehicle pie while Hyundai India enjoyed 15.8 per cent of it. Tata Motors (standalone operations) and Mahindra & Mahindra (M&M) had a market share of 14.6 per cent and 12 per cent respectively during the reported period. Key Statistics

The Society of Indian Automobile Manufacturers (SIAM) anticipates 11-13 per cent growth in car sales during 2012-13 The overall Indian automobile sector recorded a growth of 14.25 per cent (16.9 million units from 14.8 million units in 2010) in 2011. Passenger car sales increased by 4.24 per cent to 1.946 million units (from 1.867 million units in 2010), two-wheeler sales by 16.22 per cent to 13 million units and threewheeler sales by 4.74 per cent to 525,000 units

For 2011-12, passenger cars sales are expected to grow at 0-2 per cent, twowheelers at 13-15 per cent and commercial vehicles at 18-20 per cent The cumulative production for April-December 2011 registered a growth of 14.94 per cent over same period in 2010. Production in December 2011 increased by 10.91 per cent year-on-year (Y-o-Y)

Overall automobile exports registered a growth rate of 28.97 per cent during April-December 2011. Passenger Vehicles registered grew 18.14 per cent in this period while two-wheelers, commercial vehicles and three wheelers segments recorded growth of 29.75 per cent, 24.66 per cent and 42.63 per cent respectively

Indian Automobile Industry: Major Developments & Investments

Ford Motor Co's Indian subsidiary has placed an order with its Indian counterpart major constructor Kajima Corp's subsidiary to develop an auto factory in the city of Sanand in Gujarat. With an estimated outlay of 77 billion yen (US$ 1 billion), the facility is expected to get completed by 2014 with an initial annual capacity of 240, 000 units. Bajaj Auto India's second largest automaker has made a debut in four-wheeler segment by launching a low-cost, eco-friendly automobile - RE60. The four wheeler vehicle has three-wheeler customers as its target market and is available in three fuel variants (petrol, CNG and LNG). The company sees Sri Lanka and Africa as potential export markets for RE60. Indian auto major M&M is looking to develop enough infrastructure to run electric cars in India. The first company to commission solar power projects under the Jawaharlal Nehru National Solar Mission (JNNSM), M&M is on a look-out for solar powered charging stations to fuel electric cars. The company offers electric cars under the Mahindra-Reva brand. Luxury car maker Mercedes Benz AG's Indian subsidiary Mercedes Benz India Ltd (MBIL) has set itself an ambitious target to sell over 70,000 cars in the Indian market by 2020; aiming for 1000 per cent growth in the next 9-10 years and hence leading the luxury car segment. The company will launch its A Class concept in India in 2013 and has already invested Rs 700 crore (US$ 135.85 million) in a new assembly plant in India. With an intention to take on Maruti Suzuki India Ltd's largest-selling Alto hatchback, Nissan Motor Pvt Ltd is planning for a small car for Indian markets. The company is studying the market currently and would come up with a crisp plan in 2-3 years. Auto Expo: A Grand Success India's 11th Auto Expo jointly hosted by SIAM, Confederation of Indian Industry (CII)

and Automotive Component Manufacturers Association (ACMA) took place at Delhi's Pragati Maidan during January 5-11, 2011. A grand success in terms of footfall, the exhibition embraced 1,500 participants from 24 countries and witnessed launch of over 50 new products. Indian automaker Maruti Suzuki unveiled its XA Alpha concept sports utility vehicle (SUV) while Hyundai showcased its new Sonata and its concept multi-purpose vehicle Hexa Space. German automobile major Volkswagen launched new versions of its SUV Touareg and its small car Beetle along with its concept hybrid car XL 1. Japanese auto giant Nissan Motor Company showcased its seven-seater car, the Evalia along with its zero-emission electric car Leaf, the Nissan GTR and the Compact Sports Concept. Similarly, other auto makers like Mercedes-Benz, M&M, BMW and Ford unveiled their new products. In the two-wheeler space, Suzuki Motorcycles, Yamaha India unveiled their offerings while Royal Enfield and Harley Davidson made their bike launches. Thus, it can be reasonably stated that major auto makers - Indian as well as foreign are making all the efforts to please Indian auto enthusiasts and Auto Expo is a perfect platform for them where they can reach out to masses in the most effective way. Government Initiatives The Government of India is in the process of forming a National Automotive Board (NAB) which would become a formal set-up to look into the issue of recall of vehicles and hence improve manufacturing standards. The prospective body, to oversee technical and safety aspects of vehicles, will have representatives from all the nodal ministries and automotive bodies such as the Automotive Research Association of India (ARAI). The Government of Gujarat has always been on a high to promote its industrial space especially its the automobile sector. In order to boost the State Government's efforts in this regard, Gujarat Government's Industrial Extension Bureau, along with

Automotive Components Manufacturers Association, French Vehicles Equipment Industries (FIEV) and French auto-major Peugeot, organised a seminar and business meeting on January 9, 2011 wherein 60 French automobile component makers were briefed on opportunities to set up vendor park near Sanand (Gujarat's auto hub) in Ahmedabad district. Similarly, the Government of Gujarat has announced its plan to disburse 240 acres of land at Sanand to the All India Plastic Manufacturers Association (AIPMA) to set up a plastic park that could attract an investment of about Rs 5000 crore (US$ 970.33 million). The Government's move marks its eye for detail as the measure has come in the light of the fact that a finished car would require about 150 kgs of plastic. According to a study by Rothschild, India would become the third largest auto industry by volumes after China and the US by 2015. Three- fold increase in investments by auto makers would boost car production capacity from 4.8 million units in 2010 to 12 million in 2018. The firm anticipates that the forecast would come to reality through 30 new factories that are estimated to come up in next eight years. The firm holds a bullish outlook on Indian auto industry and predicts a row of mergers and acquisitions in the coming years.

AVIATION
India is expected to be amongst the top five nations in the world in the next 10 years in the aviation sector. On the sidelines of the International Civil Aviation Negotiation (ICAN) Conference, Ms Pratibha Patel, President of India highlighted that currently, India is the 9th largest civil aviation market in the world. "Recent estimates suggest that domestic air traffic will touch 160-180 million passengers a year, in the next 10 years and the international traffic will exceed 80 million passengers a year," added Ms Patil. India is poised to emerge as the third largest aviation market in the world by the end

of this decade, according to Dr Nasim Zaidi, Secretary, Ministry of Civil Aviation. The sector with a growth of 18 per cent in domestic market is expected to generate approximately 2.6 million jobs in the next one decade, added Dr Zaidi. In addition, the US-based electrical components company, Eaton Corporation foresees plenty of opportunities for itself in India's unfolding civil and military aerospace story. "India is expected to emerge as one of the largest aviation markets in the world," according to Joe-Tao Zhou, APAC President, Aerospace Group, Eaton Corporation. Moreover, the Indira Gandhi International Airport (IGI) in New Delhi, India, has been ranked the second-best airport in the world for 2011 by the Airports Council International. The airport scored this distinction in the category of airports with 25-40 million passengers per annum. The IGI airport handled a record number of 35 million passengers in 2011. The airport has an annual passenger capacity of over 60 million of which terminal 3 can alone handle 34 million passengers. In addition, the airport also handled over 600,000 tonnes of cargo and over 300,000 aircraft movements in 2011. Market Size The rapidly expanding aviation sector in India handles 2.5 billion passengers across the world in a year; moves 45 million tonnes (MT) of cargo through 920 airlines, using 4,200 airports and deploys 27,000 aircraft. Today, 87 foreign airlines fly to and from India and five Indian carriers fly to and fro from 40 countries. Passengers carried by domestic airlines during January 2012 was recorded at 5.33 million as against 4.94 million during the corresponding period of previous year thereby registering a growth of 8.06 per cent, according to data released by the Directorate General Civil Aviation (DGCA). The air transport (including air freight) in India has attracted foreign direct investment (FDI) worth US$ 429.70 million from April 2000 to December 2011, as per data released by Department of Industrial Policy and Promotion (DIPP).

Private carriers are anticipated to post a combined profit of US$ 350 million US$ 400 million for the financial year ending March 31, 2012, according to a report titled, '2011-12 Aviation Industry Outlook' by Centre for Asia Pacific Aviation (CAPA) India. The firm expects the domestic traffic to grow as high as 20 per cent. International passenger numbers, which grew by about 10 per cent last year, are expected to increase towards the upper end of a 10-12 per cent range over the next 12 months. Market Players

Eurocopter, the global leader in helicopters, plans to focus on new markets in India in the emergency medical services, utility, law enforcement and search and rescue areas while maintaining its leadership position in the passenger, private, oil and gas and VIP markets, the company official added

The first 100 per cent private airport in the country is likely to become operational in Karaikal, an enclave of Puducherry in Andhra Pradesh, in another 24 months, as per a top official of the Super Airport Infrastructure Pvt Ltd, the developers. The first phase of construction is estimated at Rs 150 crore (US$ 30.06 million) for a 1.8 kilometres (Kms) runway

The new domestic terminal building at Biju Patnayak Airport at Bhubaneswar, which is likely to be completed by August 2012, will cater to 800 passengers from the existing capacity of 500 of the present terminal building. The new terminal building will be completed at a cost of Rs 145.54 crore (US$ 29.17 million)

The MAS GMR Aero Technic (MGAT), the aircraft maintenance, repair and overhaul (MRO) complex at the Rajiv Gandhi International Airport (RGIA) in Hyderabad was inaugurated by Mr Ajit Singh, Minister of Civil Aviation. The MRO facility, a fully-owned subsidiary of MAS GMR Aerospace Engineering Co (MGAE), was set up at an investment of around Rs 350 crore (US$ 70.14 million)

The Joy Alukkas Group, the Kerala-based gold jewellery retail chain, plans to invest Rs 100 crore (US$ 20.04 million) in its aviation wing by next year to provide exclusive air charter services to various destinations across India and

abroad and helicopter tours within Kochi. The Group would also launch its helicopter services in March 2012 Aerospace on a High

The Turkish Airlines is planning to expand its operations in India by 2012. "India is a very important market for us and we need to fly to at least five cities there," according to Temel Kotil, CEO, Turkish Airlines

A world leader in manufacture of aircraft cabin interior products, B/E Aerospace, has announced the opening of its Engineering Services Division in Hyderabad. The development comes close to the 3rd edition of India Aviation, a major aviation show that will be held in Hyderabad during March 14-18, 2012

An Australian delegation led by H E Ted Baillieu, the Premier of Victoria called on Mr Ajit Singh, the Minister of Civil Aviation in New Delhi. The delegation discussed the proposed launch of direct air services by the Air India from New Delhi to Melbourne. Air India has proposed to commence direct services from about the third quarter of 2012-13, using the B-787 aircraft which are expected to be inducted in May 2012. With the services in place, Air India would be the only carrier serving the India-Australia market non-stop

The representatives from Armenia, Argentina, Azerbaijan, Republic of Belarus, Brazil, Cameroon, China, Cuba, Chili, India, Japan, Republic of Korea, Mexico, Malaysia, Nigeria, Paraguay, Russian Federation, Saudi Arabia, Seychelles, Singapore, South Africa, Uganda and United States of America (USA) of International Civil Aviation Organisation (ICAO) met in Moscow on February 21 and 22, 2012 and reaffirmed the importance of the role of the ICAO in addressing international civil aviation emissions, including pursuant to the request from the parties to the United Nations Framework Convention on Climate Change (UNFCCC)

Recent Developments

The IGI Airport in New Delhi has been categorised as the most lucrative retail

location for luxury brands like Swarovski, Marks & Spencer (M&S), Hidesign and many more. The airport has generated sales of 5,000 per square feet per month in 2011. It is the largest and busiest airport in South Asia. More than 35 million passengers used it last year. It is the fourth largest retail hub in the country with sales of Rs 1,200 crore (US$ 240.48 million) in 2011

Airport retail business in India has topped in revenue registering US$ 1 billion during 2011, according to a boutique retail consultancy. The business is growing at 17-18 per cent annually, emerging as a viable platform for retailers and operators of the new airports, according to consulting firm Asipac Projects

Government Initiatives The Ministry of Civil Aviation, Government of India (GOI), has decided to allow the Indian Scheduled Carriers including Air India to utilise the allocated bilateral till the time they reach the maximum permissible limit under Air Service Agreements (ASAs). Air India's operational plan will receive due consideration in allocation of the traffic rights and entitlements. The Ministry has also supported the approach outlined in the Inter Ministerial Group (IMG) discussion paper in this context. Keeping in view the recent developments in the civil aviation sector and in order to modernise and update the existing Air Services Agreements (ASAs) with foreign countries as per the ICAO templates, the Ministry of Civil Aviation has signed ASAs with Indonesia and Brazil, besides initialising ASAs with Jamaica, Dominican Republic, Mozambique, Uganda, Trinidad and Tobago. The Group of Ministers (GOM) on Civil Aviation, in its meeting held on February 7, 2012, has decided that Ministry of Commerce may permit direct import of Aviation Turbine Fuel (ATF) by or on behalf of Indian Carriers as actual users and on actual use basis. The Government's open sky policy has attracted many foreign players to enter the market and the industry is growing in terms of players and the number of aircrafts.

Given the strong market fundamentals, the civil aviation market is expected that it will register a compound annual growth rate (CAGR) of more than 16 per cent during 2010-2013. The Government has taken various steps towards structural policy reforms and is coming out with new policies which are liberal and will encourage public-private partnerships (PPP)

Government of India allows 100 per cent foreign direct investment (FDI) for green field airports, via the automatic route. Moreover, foreign investment up to 74 per cent is permissible through direct approvals while special permissions are required for 100 per cent investment

Private investors are allowed to set up general airports and captive airstrips while maintaining a distance of 150 kms from the existing ones. Complete tax exemption is also granted for 10 years

About 49 per cent FDI is allowed for investment in domestic scheduled passenger airlines and investment up to 100 per cent by non-resident Indians (NRI) via the automatic route. FDI up to 74 per cent is allowed for nonscheduled and cargo airlines

The Ministry of Civil Aviation has released the Vision-2020 document, which is an assessment of the overall outlook of the aviation sector in 2020. It highlights that the aviation sector has a growth potential to absorb upto US$ 120 billion of investment. Furthermore, the fleet size of commercial airlines sector will be approximately 1,000 aircraft, domestic passenger numbers could reach 150-180 million, helicopter fleet is expected to be 500, while the air cargo movement is expected to reach the level of 9 million metric tonnes (MMT). The aviation sector is one of the major economic drivers for prosperity, development and employment in the country. Massive investments in airport infrastructure have led to world class airports which have become the symbol of India's growth story.

TELECOMMUNICATION
Third largest in the world and the second largest among the emerging economies of Asia, the Indian Telecommunication network has proved its mettle time and again. Public as well as private segments of the economy have made significant contributions to make the sector one of the key contributors to India's success story. The growth of Indian telecommunication sector is highly driven by supportive government policies, emerging new technologies and changing consumer behaviour. The fact that the industry has made stupendous growth in recent times is reflected in the statistics, key developments, investments and future prospects pertaining to itare discussed hereafter. Key Statistics

In its recent statement issued, Telecom Regulatory Authority of India (TRAI) has revealed that the country's mobile subscriber base has increased from 893.84 million in December 2011 to 903.73 million in January 2012, growing by 1.11 per cent

Telecom operators added 9.88 million mobile subscribers in January 2012, taking the total telephone user base to 936.12 million The overall tele-density (telephones per 100 people) reached 77.57 per cent Broadband subscriber base increased from 13.30 million at the end of December 2011 to 13.42 million at the end of January 2012

Market Dynamics The Indian handset market has registered 14.1 per cent growth in 2011 marking a volume sale of 182 million handsets. The Indian handset market is led by Nokia with 37.2 per cent market share, followed by Samsung (14.9 per cent), G'Five (7.5 per cent) and Micromax (5.8 per cent).

Indian handset market experiences a strong presence of domestic and Chinese handset makers (like Micromax, G'Five, Karbonn, Spice, Maxx and Lava) owing to their offerings that are reasonably priced as well as fully featured with latest technologies and applications. Moreover, every vendor is venturing into the flourishing smartphone market in India. A report by CyberMedia Research (CMR) reveals that that there were 10 million units of smartphones shipments over January-November 2011. The report titled 'India Monthly Mobile Handsets Market Review' also stated that there were 23 smartphone model launches in the month of November itself. For smartphone shipments also (during January-November 2011), Nokia led the market with 38.4 per cent share, with Samsumg (27.5 per cent) and Reliance India Mobile (RIM [15.5 per cent]) trailing behind. Key Developments & Investments

In a bid to globalise its Indian operations that would support its global product supply chain, Ericsson, the world's largest mobile network equipment maker, has plans to ramp up its investments in the country. Driven by changing demographics and consumer behaviour, Ericsson's strategy is to upgrade Indian operations from being domestic-market oriented to export oriented

Indian start-up company Lava has formed a strategic partnership with Intel with the launch of the first Intel-powered smartphone in India, the Xolo X900. Lava, which has so far manufactured budget phones, will now produce smartphones under the brand name 'Xolo'

India's third largest mobile phone company Idea Cellular has entered an alliance with Opera Software to launch a customised 'Opera Mini' mobile web browser. Apart from being a mass-market web browser that claims to offer a rich web experience to smartphone users, Opera Mini would also help in driving data traffic and increase average revenue per user (ARPU)

Bharti Airtel has launched an innovative mobile money platform called 'Airtel

Money' in India through its wholly-owned subsidiary Airtel M Commerce Services Ltd (AMSL). Airtel users, across 300 key cities in India, would be empowered to top-up their cell-phones with airtime and pay for their utility bills, recharges, shopping at 7,000-plus merchant outlets and online transactions through this fast, simple and secure service

India's fifth-largest Global System for Mobile Communications (GSM) operator Aircel, has decided to renew its outsourcing contract worth US$ 100 with Nokia Siemens Networks (NSN) to manage its mobile networks in seven circles - Delhi, Mumbai, Kolkata, Punjab, Haryana, West Bengal and Rajasthan

NSN has also bagged a contract from Bharti Airtel, the world's fifth largest telecom company, to build and operate its long-term evolution (LTE) network in Maharashtra circle. LTE is a 4G mobile broadband technology that supports services like high-speed internet and video streaming on the go. Government Initiatives The sector regulator, TRAI, has issued guidelines to all the operators to set up a complaint centre under Telecom Consumers Complaint Regulations, 2012. The centre would be responsible in acknowledging all the complaints it receives, even if the complaint is made by a subscriber of another mobile operator. It would have a tollfree number and would be equipped with a web-based complaint monitoring system, through which the consumers can track their complaints. TRAI is also doing its bit to achieve the aim of carbon emission reduction under which operators are directed to achieve carbon reduction to the extent of 5 per cent by 2012-13, 12 per cent by 2016-17 and 17 per cent by 2018-19. With regards to these norms under 'Green Telephony', TRAI has further mandated for all the operators that at least 50 per cent of all rural towers and 20 per cent of all urban towers are to be powered by hybrid power by 2015. The government has also given its nod for the same.

Moreover, the National Telecom Policy (NTP) 2012 has received approval from the Telecom Commission. It will now head to the Cabinet for further consideration and approval. The new telecom policy endorses free roaming service to telecom users while allowing them to retain their numbers without paying extra. The new policy would also allow telecom players to exit from the business under specific conditions. According to ABI Research, a US-based market intelligence company specialising in global connectivity and emerging technology, the Indian handset market is poised to grow at a compounded annual growth rate (CAGR) of 10.7 per cent over 2011-17, with total handset volume projected to mark 335 million units of sales by 2017. Industry experts believe that smartphone segment would be the fastest-emerging division that would even outpace the overall handset market. The segment is anticipated to account for 29 per cent of the total handset volume with 97.2 million units by 2017, registering a CAGR of around 40 per cent.

Banking
Indian Banking Sector: The Rs 64 trillion (US$ 1.22 trillion) Indian banking industry has made exceptional progress in last few years, even during the times when the rest of the world was struggling with financial meltdown. Even today, financial institutions across the world are facing the repercussions of the turmoil but the Indian ones are standing stiff under the regulator's watchful eye and hence, have emerged stronger. Ratings agency Moody's believe that strong deposit base of Indian lenders and Government's persistent support to public sector and private banks would act as positive factors for the entire system amidst the negative global scenario. The sector has undergone significant developments and investments in the recent

past. Some of them are discussed hereafter along with the key statistics and Government initiatives pertaining to the same. Key Statistics

According to the Reserve Bank of India (RBI)'s Quarterly Statistics on Deposits and Credit of Scheduled Commercial Banks', March 2011, Nationalised Banks, as a group, accounted for 53.0 per cent of the aggregate deposits, while State Bank of India (SBI) and its associates accounted for 21.6 per cent. The share of New private sector banks, Old private sector banks, Foreign banks and Regional Rural banks in aggregate deposits was 13.4 per cent, 4.6 per cent, 4.4 per cent and 3 per cent respectively.

With respect to gross bank credit also, nationalised banks hold the highest share of 52.8 per cent in the total bank credit, with SBI and its associates at 22.1 per cent and New Private sector banks at 13.2 per cent. Foreign banks, Old private sector banks and Regional Rural banks held relatively lower shares in the total bank credit with 4.9 per cent, 4.6 per cent and 2.4 per cent respectively.

Another statement from RBI has revealed that bank advances grew 17.08 per cent annually as on December 16 while bank deposits rose 18.03 per cent. RBI data shows that India raised US$ 1.6 billion through external commercial borrowings (ECBs) in November 2011 for new projects, capital outlay et al. 78 companies raised US$ 1.3 billion under automatic route and US$ 253 million was raised under the approval route (it requires case-by-case approval by the regulator).

India's foreign exchange reserves stood at US$ 297 billion as on December 30, 2011. In recent years, deposits under non-resident Indians (NRI) schemes have witnessed an upsurge. There was an inflow Rs 14,763 crore (US$ 2.83 billion) under NRI deposits in 2010-11, which was 6.5 per cent higher from 2009-10. In

2011, the total of NRI deposits was Rs 2,30,812 crore (US$ 44.2 billion), compared to Rs 2,27,078 crore (US$ 43.5 billion) in 2010. Recent Developments

The US Export-Import Bank, with a commitment of US$ 7 billion, is on a way to diversify its portfolio in India by financing projects in education, healthcare and agriculture. After Mexico, India is the second biggest investment destination for the bank as the entity anticipates the country to become the largest market in next 12-18 months.

India Infrastructure Finance Company Ltd (IIFCL) and IDBI Bank have inked a five-year memorandum of understanding (MoU) to launch infrastructure debt fund (IDF) schemes. The IDF, for which IDBI Bank and IIFCL would play strategic investors, is expected to get launched by the end of February 2012.

With 'green power' projects getting highly popular in India, especially in the states of Gujarat and Rajasthan, banks are increasingly opening up to projects from non-conventional (solar and wind) energy space. After receiving project proposals that were meant for a particular industry/consumer or group of industries/consumers for their own use, banks are now getting projects that entail commercial viability (25-100 mega watt).

With an intension to strengthen its hold in Southern India, the Uco Bank is planning to add 11 more branches in Andhra Pradesh to its 66-branch-strong network in the state. The bank has made exemplary progress in recent past with 2,004 branches in the country and four abroad.

Government Initiatives Agreeing to Khandelwal Committee's recommendation, the Government has said that state-run banks will get two Chief Executives and the large banks would get three Executive Directors (EDs) in their management panel. Banks with a business of more than Rs 300,000 crore (US$ 57.44 billion) are considered to be large entities. The third ED, however, would be responsible for human resource development (HRD) and

technology in the bank. "Non-resident Indians (NRIs) are crucial investors for banks as they form 10 per cent of total personal segment deposits," said Samir Kumar Bhattacharya, General anager (NRI), State Bank of India (SBI). In order to encourage them, the RBI had deregulated interest rates on Non-Resident (External) Rupee Deposits and Ordinary Non-Resident Accounts (on December 16, 2011) due to which banks are able to offer competitive rates to NRIs. This move has further made India an attractive investment destination for them. Further, the Government of India has decided to infuse Rs 6,000 crore (US$ 1.15 billion) in public sector banks during the remaining 2011-12 to ensure that the entities meet regulatory requirements. In 2010-11, the Government had provided Rs 20,157 crore (US$ 3.86 billion) as its capital support to public sector banks. In order to prepare public sector banks for neck-to-neck competition ahead and improve their performance in future, the Ministry of Finance has set new benchmarks for them to achieve. The new benchmarks, that would calculate their functional and financial capability to qualify for capital infusion, entail three performance indicators - savings and current deposit ratio, employee-branch ratio and profit per employee. According to Chanda Kochhar, Managing Director and Chief Executive Officer, ICICI Bank India's banking sector has the potential to become a Rs 200 trillion (US$ 3.83 trillion) industry by 2020 if the country's economy grows at 8 per cent per annum over a long term as the growth of any country's banking sector depends on the growth of that country's gross domestic product (GDP). Another report by The Boston Consulting Group (BCG) India, in association with a leading industry organisation and Indian Banks Associations (IBA) predicts that Indian banking sector would become the world's third largest in asset size by 2025. The report also analyses that mobile banking would become the second largest channel of banking after ATMs. Given the positive eco-system of the industry, regulatory and

Government initiatives, mobile banking is anticipated to enhance from 0.1 per cent of transactions in a 45 per cent financial inclusion base in 2010 to 34 per cent of the transactions with 80 per cent rural inclusion base by 2020, as per the report.

CONSUMER MARKETS
Consumer Markets in India According to Manu Anand, CEO, PepsiCo India, India's consumer pyramid is shaping into a diamond. The Indian consumer markets are majorly driven by increase in disposable incomes, apart from other factors like change in demographics, entry of foreign players, liberalisation, Government efforts et al. Asia's third largest economy currently accounts for 2.7 per cent of the global consumption. Indian consumer markets are experiencing a flurry of investments as more and more foreign majors are getting attracted towards a set-up which is considered to be economically safe and with huge potential. The Indian consumer markets- majorly comprising retail, fast moving consumer goods (FMCG), luxury brands and ecommerce- have witnessed lot of developments in the recent past. Some of them are discussed hereafter. Investments through FDI, M&A and PE in India Cumulative FDI inflows in single-brand retail trading during April 2000 to November 2011 stood at US$ 44.45 million, according to the Department of Industrial Policy and Promotion (DIPP).

Retail in India
Business Monitor International (BMI) has recently released its India retail report for first quarter of 2012 which projects that total retail sales will grow from US$ 422.09 billion in 2011 to US$ 825.46 billion by 2015. Explosion of organised retail in a big way is one of the major factors behind such a positive forecast. Certain developments in this space are given below:

Kama Schachter, the diamond jewellery manufacturer and exporter, has plans to venture into India's retail market. The company would infuse a capital of Rs 50-70 crore (US$ 10.15-US$ 14.23 million) for building brand, marketing and for opening retail store in 2012. The jeweller plans to open around 20 stores in India, starting with Mumbai and Delhi, within a span of five years.

Auchan, the second largest French grocer after Carrefour, is holding discussions with the Landmark Group to foray into Indian business space. Landmark Group currently runs the Dutch retail chain Spar in India.

E-tailing Emergence of internet retailing (e-tailing) and e-commerce as a completely new space is driving the growth of number of online shoppers. As a result, the internet retailing companies are getting attracted towards Indian markets which are poised to grow leaps-and-bounds in the years to come. There are about 17 million online shoppers in India and the number is projected to grow over three times in the years to come. Seattle-based world's largest internet retailer Amazon.com has recently launched its website Junglee.com with a view to harness burgeoning online shopping market in India which is expected to triple in size by 2015. Junglee.com has partnered with several Indian online and offline retailers like HomeShop18, Hidesign, Dabur Uveda, the Bombay Store and others. It has also

formed alliances with online players like Snapdeal, Univercell, Saholic (a Spice Group firm) and Fommy.co.in.

India's largest and most-funded e-commerce company Flipkart Online Services Pvt. Ltd has acquired Letsbuy.com, the country's second-largest online electronics retailer, for an undisclosed amount. The move reflects Flipkart's strategy of becoming a major player through acquisitions and eventually grabbing a substantial pie of the ever- increasing Indian online retailing space.

FMCG FMCG companies in India are no more confined to domestic boundaries to propel their growth. As the consulting firm PriceWaterhouseCoopers (PwC) indicates, they are searching for newer markets to enhance their visibility and hence, are headed towards the Global Emerging Middle (GEM) nations. PwC projects that purchasing power of these geographies would swirl from the current US$ 2.7 trillion to US$ 6 trillion by 2021, with the Indian FMCG segment poised to account for at least US$ 300 billion.

FMCG firm Marico has acquired a part of the personal care business of Paras Pharma owned Reckitt Benckiser India for an undisclosed amount. In a bid to consolidate its position in the dairy segment, FMCG major CavinKare has launchedultra-high temperature (UHT)-treated milk - Cavin's Pure+ -, which can last for 120 days, without using refrigerator. While the processing technology was procured from Holland, the packaging was developed in collaboration with a Mumbai-based packaging firm.

Direct selling FMCG company Amway India intends to establish its first greenfield manufacturing facility in India at estimated outlay of about Rs 300 crore (US$ 61 million). The plant, expected to be commissioned in 2014, will majorly produce products under the nutrition and beauty categories.

Indian Luxury Market

India is witnessing a rapid evolvement of the lifestyle luxury market owing to growing disposal incomes and consumer awareness. Currently, the Indian homewares market (including furnishing, furniture and home decor) is valued at Rs 80,000 crore (US$ 16.24 billion) growing at 10-12 per cent annually. On the other hand, according to a recent study by industry body CII and AT Kearney, the domestic luxury market, currently valued at US$ 5.8 billion, is growing at 20 per cent per annum and is projected to grow to US$ 14.7 billion by 2015.

Italian luxury fashion brand Canali has received FIPB's nod to set up a 51:49 per cent joint venture (JV) with Genesis Luxury Fashion to conduct retail operations in India. The JV would invest Rs 7.65 crore (US$ 1.56 million) and intends to open 10-15 stores by 2015-16.

Italian luxury brand Giorgio Armani is intending to bring its high-end homeware and furnishings retail stores to India by 2013. The high-end brand's group is in discussions with potential local partners even as theylook for retail spaces in India to open Armani Casa outlets in the country.

Italian fashion brand Roberto Cavalli has partnered with Infinite Luxury to enter Indian luxury brand space. The alliance would also bring the designer's Cafe Cavalli to the country. Cavalli plans to open its outlet at Delhi's DLF Emporio Mall by May 2012.

Government Initiatives The Indian Government is making all the efforts to open up Indian markets to the world that would give consumers wider options in terms of products and services. Recently, the Government has given its nod to 20 FDI proposals. While the concerned Government sections are building consensus over allowing 51 per cent FDI in multi-brand retail, 100 per cent FDI in single-brand retail has been given a green signal.

A new report released by Boston Consulting Group (BCG) and Confederation of Indian Industry (CII) projects that India's robust economic growth and rising household incomes would take consumer spending to a level of US$ 3.6 trillion by 2020. Food, housing, consumer durables, transport and communication are expected to garner the most of consumer spending. The report further stated that India's share of global consumption would expand more than two times to 5.8 per cent by 2020.

Insurance
Indian Insurance Industry: The Indian insurance industry is hugely driven by higher disposable incomes, changing demographics, Government efforts, launch of new products, lesser complexities and entry of foreign players. The sector is not only outpacing India's economic growth figures, but is also standing strong as an important financial segment through turbulent times. As per industry estimates, insurance penetration in India stood at 5.1 per cent in fiscal 2010-11. While life insurance penetration was marked at 4.4 per cent during the year, general insurance sector penetrated to an extent of 0.7 per cent in 2010. As of now, insurance accounts for just 3 per cent of overall healthcare expenditure in India which implies that there lies a great potential to enhance the penetration of insurance as a concept. The scope of growth is further enhanced by rural India's development as a major contributor to the economy as the clan residing in hinterlands is increasingly getting aware of new products and services across all the economic and social segments. The Rs 2.9 trillion (US$ 58.7 billion)-Indian life insurance industry has emerged as the mainstay of entire insurance space. With over 35 crore life insurance policies in force,

the industry has registered remarkable growth since its privatisation in 2000. The overview further discusses how the sector has fared in terms of growth, developments and Government participation in the recent past. Recent Statistics The 24 life insurance players' premiums collected in April-December 2011 stood at Rs 71, 953.54 crore (US$ 14.59 billion) while the industry sold about 27.24 million policies during the period, according to data collected by the Insurance Regulatory and Development Authority (IRDA). With respect to general insurance industry, there was a growth of 24 per cent in first three quarters of 2011-12 in gross written premium collected. The general insurance industry collected premium of Rs 42,023.3 crore (US$ 8.51 billion) by writing new policies during the period. While private insurers registered a growth of 26.73 per cent in premium collection at Rs 17,525.3 crore (US$ 3.55 billion), the four state-owned general insurance companies collected Rs 24,498.1 crore (US$ 5 billion) (22.1 per cent higher than the corresponding period a year ago). Health Insurance Industry in India According to a recent report by UK-based research firm BRICdata, Indian health insurance market would scale new heights in terms of growth owing to the country's robust economic growth, changing demographic patterns, expected increase in foreign direct investment (FDI) limits and the expansion of distribution networks. The Indian health insurance segment accounted for 3.2 per cent of the overall insurance industry in 2011 thereby leaving a lot of scope for further growth and penetration. During the review period (2007-2011), the penetration of Indian health insurance products stepped up from 0.07 per cent in 2007 to 0.19 per cent in 2011, as many new

policies were sold in hinterlands. The health insurance business constitutes more than 25 per cent of the general insurance industry in India. Health insurance premium collection during the AprilSeptember period of 2011-12 rose 21.3 per cent to Rs 6,721.53 crore (US$ 1.36 billion) from Rs 5,540.34 crore (US$ 1.12 billion) in the year-ago period. Recent Developments

Health insurance policies are on their way to get 'age-free'. Though the proposal is still at a nascent stage, IRDA has already taken a step towards this concept by making it mandatory for policies to have 'life long' renewal clause. This implies that once a health insurance policy is issued, an insurer would be obliged to continue renewing such a policy during the policyholder's lifetime. However, the entry age barrier would continue to be there

Some general insurance companies have already started applying for such 'agefree' policies. For instance, Apollo Munich Insurance applied for such a policy a few months back and is awaiting regulator's approval

Cigna TTK Health, a joint venture (JV) company between US-based Cigna Corporation and India's TTK Group, is in the process of applying for the R1 licence with the regulator IRDA and expects to commence operations in the first quarter of 2013

The JV firm, being the new entrant on the Indian health insurance block, intends to be innovative and hence plans to set up a distribution network through which simple health insurance products could be sold by pharmacies themselves

State-owned Life Insurance Corporation (LIC) would buy 5 per cent stake in Punjab & Sind Bank. The bank's proposal to issue 11.2 million fresh shares is awaiting Securities and Exchange Board of India (SEBI)'s decision regarding the rate and is eventually subject to approval from the Government of India and other regulatory entities

The infusion of additional capital aims at strengthening bank's 'Capital to Riskweighted Assets Ratio' (CRAR) and support its business growth HDFC Life, a private life insurance company and a JV between India's Housing Development Finance Corporation Ltd (HDFC) and UK's Standard Life plc has launched its first international operations with the opening of its representative office in Dubai. The launch comes as a result of the company's strategy to serve large non-resident Indian (NRI) base in the Gulf region

In a bid to enhance overall customer offering and rapidly expand its motor insurance business, private insurer SBI General has entered an alliance with My TVS and India Assistance. The tie-up aims to provide emergency roadside assistance to its policy holders anytime and for any car across the country

Government Initiatives The Ministry of Finance is planning to appoint an independent advisor at the Insurance Regulatory and Development Authority (IRDA), who would directly report to the Government and assist the regulator in policy decisions. Also, the Government may set up advisory groups across segments to discuss issues relating to growth, product development, insurance penetration and regulations pertaining to the sector. Further, insurance regulator IRDA may soon give its nod for making insurance policies available in demat form, paving way for e-insurance accounts and e-policies. Five entities - CAMS, Karvy, NSDL, CDSL and STCI have already been shortlisted to set up and operate insurance repositories. An insurance repository is a company that maintains data on insurance policies electronically on behalf of insurers. If IRDA give its approval, India would probably be the first country in the world to undertake such a massive activity of converting physical insurance policy certificates into electronic form. According to a report by BRICdata, the market size of Indian life insurance industry is

anticipated to touch US$ 111.9 billion in 2015 from US$ 66.5 billion in 2011, marking a compounded annual growth rate (CAGR) of 14.1 per cent. The report estimates that India would be the third-largest market for life insurance in the world by 2015, only after China and Japan. At present, India stands 12th among the top global markets for life insurance. Also, the number of policies sold is expected to increase to 85.21 million in 2015 from 53.23 million in 2010. While individual life insurance segment is expected to account for 79.3 per cent of the life insurance industry in 2015 (from 74.8 per cent in 2010), unit-linked insurance plans (ULIPs) are estimated to be fastest growing product category at a CAGR of 21.2 per cent during that year.

Media and Entertainment

The Indian Media & Entertainment (M&E) industry is highly driven by strong consumption in non-metro and small cities, intense emergence of regional media and burgeoning new media businesses and formats. According to a report jointly prepared by KPMG and an industry body, the industry registered a growth of 12 per cent in 2011 over 2010. While television (TV) retains its top slot as an entertainment medium, segments like animation, VFX, digital media and gaming are up-coming as major mediums. Multiple movies crossed Rs 100 crore (US$ 20.04 million)-business in domestic theatrical collections and Rs 30 crore (US$ 6 million) mark in Cable & Satellite (C&S) rights. Advertising spends across all media accounted for 41 per cent of the overall M&E industry revenues, aggregating to Rs 300 billion (US$ 6 billion) while advertising revenues witnessed a growth of 13 per cent in 2011. Television and Digitisation Television continues to be the most prominent entertainment medium in the Indian M&E industry. As per the report (by KPMG and another industry body), television

would account for almost half of the Indian M&E industry revenue and would also be over twice the size of print media (the second largest media sector) by 2015. While the current level of penetration is estimated at around 60 per cent, there is still a lot of room for expansion on Indian TV landscape. The report further estimates that payTV subscription revenue will increase from 65 per cent in 2011 to 69 per cent by 2016. Moreover, TV accounted for Rs 329 billion (US$ 6.6 billion) of revenues in overall M&E industry in 2011 and is estimated to grow at a CAGR of 17 per cent over 2011-16 to touch Rs 735 billion (US$ 14.73 billion) in 2016. Indian television industry has undergone many changes over the past decade, majorly due to the introduction of digitised modes which include digital cable, direct to home (DTH) and IPTV. This has not only transformed the business models for the stakeholders, but has also facilitated more choices and convenience to consumers. At present India's DTH subscriber base is totalled at 45 million. India's top four metros-Delhi, Mumbai, Chennai and Kolkata-will replace all analog television networks with digital transmission from July 1, 2012. Radio The radio industry in India has around 36 FM radio operators and is estimated at Rs 1,200 crore (US$ 240.46 million). Emergence of regional media in a big way has driven the growth of Indian radio segment. According to an industry report, radio is expected to display a healthy growth rate in the years to come. After the advent of Phase 3, the industry will experience another growth wave after the implementation of awaited policies like copyright for radio and the roll out of 4G. Internet and Mobile Entertainment Internet has emerged as one of the strongest entertainment mediums owing to

increasing internet penetration, higher awareness and changing demographics in the country. Not only for sending mails, watching videos and business related transactions, internet is also being used for intensive shopping by the Indian buyers. Emergence of internet retailing and e-commerce as a completely new space is driving the growth of number of online shoppers. As a result, the internet retailing companies are getting attracted towards Indian markets which are poised to grow leaps-andbounds in the years to come. There are about 17 million online shoppers in India and the number is projected to grow over three times in the years ahead. According to a recent finding, 72 per cent of all mobile internet users in India use their cell-phones as their 'exclusive or primary' instrument to access the web. The mobile phone comes handy as compared to other media and hence emerged as the most preferred medium for variety of activities. These included entertainment (41 per cent on mobile compared to 26 per cent on television), information access (58 per cent on mobile compared to 20 per cent on television), communication (72 per cent on mobile compared to 16 per cent on desktop and laptops) and shopping or searching for products online (27 per cent on mobile compared to 19 per cent on desktop and laptops). Thus, 'internet on the go' is the new mantra for today's youth and the companies have clearly understood this as well and are making efforts to cater to this demand. Newspaper Rising literacy levels and low print media penetration offer significant potential for growth in Indian newspaper industry. Growing regional markets are driving the pace of print media that registered a growth of 10 per cent in 2010 and is expected to follow the similar pace till 2015. Investments With an intension to expand its reach in South East Asia, Online media network

company Komli Media has bought Singapore-based online advertising network, Admax, in a cash-and-equity deal. With an aim to mark US$ 100 million in revenue by 2013-14, Komli will enhance its workforce and will also rebrand Admax. The US$ 16 billion - media giant Bertelsmann has recently set up its corporate center in Delhi in India. The company is already present in India through its books publishing, broadcasting and business process outsourcing (BPO) services divisions and is now eyeing new business and investment opportunities in the and digital media space. Government Initiatives Further integrating the brands 'Cinemas of India' and 'Incredible India', the Ministry of Information and Broadcasting (MIB) and Ministry of Tourism have signed a memorandum of understanding (MoU) to further enhance film tourism. The MoU, which aims to endorse India as a filming destination for domestic and foreign film makers, will facilitate budgetary support for identified film festivals and provide a single window clearance for film shooting permissions. Eventually, it is expected that world tourist arrivals in India would rise from 0.06 per cent to 1 per cent by the end of the 12th Five-Year Plan (2012-17). A government committee has proposed that FM radio frequencies should be auctioned by the department of telecommunications (DoT) after being separated from the broadcast licence by the MIB. The recommendation aims at accelerating the third phase of expansion in the FM radio industry by bringing about greater clarity in the roles and assets of the two ministries. The government had given its nod in July 2011 for e-auctioning 839 new private radio stations under the third phase of expansion of FM radio. MIB has revealed that all the licences would be awarded by 2015 and the auction is anticipated to earn revenues of about Rs 1,733 crore (US$ 347.26 million) for the government. The recent KPMG report anticipates the market size of Indian M&E sector to touch Rs

1,457 billion (US$ 29.2 billion) by 2016. There is increased penetration in Indian markets, which is expected to even intensify further, owing to a revolution brought in by digital technology. Wireless broadband, growing internet usage, cable digitisation and higher DTH adoption would drive Indian M&E industry. The report also noted that smart phones, tablets, gaming devices have laid the foundation of a new wave in the industry.

Pharmaceuticals
The Indian pharmaceutical market is expected to touch US$ 74 billion sales by 2020 from US$ 11 billion now, according to a PricewaterhouseCoopers (PwC) report. India's pharmaceutical market grew at 15.7 per cent during December 2011, with growth in key therapy areas, including anti-diabetics, derma and vitamins outperformed the market, according to data compiled by market research firm All India Organisation of Chemists and Druggists (AIOCD). India has every chance to capitalise the opportunity to become a pharmaceutical Superpower in 2020 and a hub for all pharmaceutical manufacturing & research needs, according to Subodh Priolkar, President, 63rd IPC, and regional Managing Director, Colorcon Asia. Sector Structure/ Market Size Fitch Ratings' outlook on the Indian pharmaceutical sector for 2012 or the financial year to end-March 2013 (FY13) is stable. The agency expects credit profiles to remain stable, should long-term earnings and profitability prospects remain intact with moderate capex. "Aggregate disclosed value of merger & acquisitions (M&A) deals in the

pharmaceuticals sector surged from a meagre US$ 1.2 billion in FY10 to US$ 4 billion in FY11, reflecting a jump of more than 230 per cent," as per an Ernst & Young (E&Y)

report. M&A has emerged as one of the key strategies in the last two to three years to gain a foothold in emerging markets with several big ticket acquisitions, the report added. Domestic pharmaceutical retail market clocked a robust 15 per cent growth during 2011, mainly driven by therapies like anti-diabetic, vitamin, anti-infectives and dermatology. The domestic pharmaceutical retail reached a new milestone by recording overall sales of Rs 60,000 crore (US$ 12.20 billion) for the year 2011. Exports The Ministry of Commerce has proposed an ambitious Strategy Plan to double pharmaceutical exports from US$ 10.4 billion in 2009-10 to US$ 25 billion by 2013-14. The Government has also planned a 'Pharma India' brand promotion action plan spanning over a three-year period to give an impetus to generic exports. India has world renowned capacity in producing low cost, high quality bulk and generic drugs. Supply of such drugs and investment in producing pharmaceutical products in Belarus through joint venture (JV) by Indian companies will provide winwin situation for both countries. Presently US$ 700 million is the size of pharma market in Belarus and about 70 per cent of the total requirement of Belarus is imported. Growth The drugs and pharmaceuticals sector attracted foreign direct investments (FDI) worth US$ 5.03 billion between April 2000 and November 2011, according to the latest data published by Department of Industrial Policy and Promotion (DIPP). The Indian pharmaceutical market is poised to grow to US$ 55 billion by 2020 from the 2009 levels of US$ 12.6 billion, as per a McKinsey & Company report titled "India Pharma 2020: Propelling access and acceptance realising true potential". The industry further holds potential to reach US$ 70 billion, at a compound annual growth rate

(CAGR) of 17 per cent. India's pharmaceutical sector is gaining a global leadership position and Indian generics today constitute nearly a fifth of global supplies. Our pharmaceutical companies can be of immense value in providing affordable healthcare which is much needed in a country of Japan's demographic profile. India also has a vast pool of trained pharmaceutical scientists, doctors and researchers, which opens up avenues for joint collaborative research for new drug discoveries along with joint intellectual property rights (IPRs). Generics Generics will continue to dominate the market while patent-protected products are likely to constitute 10 per cent of the pie till 2015, according to McKinsey report 'India Pharma 2015 - Unlocking the potential of Indian Pharmaceuticals market'. Avesthagen, India's leading integrated systems biology platform company, has signed a memorandum of understanding (MoU) with Kutlo-Nitt, a Niigata-based consortium of 11 Japanese universities and two technology licensing organisations. The partnership is expected to bring important diagnostics and therapies to patients throughout the world. Avesthagen continues its commitment to deliver the best therapeutic and diagnostics solutions. Diagnostics Outsourcing/ Clinical Trials Clinigene International, a clinical research subsidiary of Biocon, and Pacific Biomarkers, a US-based company, has announced a collaborative agreement to address the speciality biomarker and high-end clinical trial laboratory needs of the global pharmaceutical and biotech industry. This partnership with Clinigene provides us access to India, an emerging hub for drug development and contract research, said Ronald Helm, CEO of Pacific Biomarkers. Investments

Mumbai-based Lupin Ltd will acquire Tokyo-based I'rom Pharmaceuticals (IP) to expand its presence in Japan. The transaction would be done through Lupin's Japanese subsidiary Kyowa Pharmaceutical Industry Co, Ltd (Kyowa), which it had acquired in 2007

Ahmedabad-based pharma major, Zydus Cadila, has acquired 100 per cent stake in Biochem Pharmaceutical Industries Ltd, a Mumbai-based mid-sized drug company. Biochem has presence in therapeutic areas of antibiotics, cardiovascular, anti-diabetic and oncological segments

Strides Arcolab announced the sale of its subsidiary, Ascent Pharmahealth Ltd, with operations in Australia and Southeast (SE) Asia to Australia-based Watson Pharmaceuticals for Rs 1,965 crore (US$ 399.47 million), approximately

US-based industrial gas company Praxair, Inc plans to invest around Rs 1,200 crore (US$ 243.95 million) over the next two years in its Indian operations. The new research and development lab that has been set up in Bengaluru will act as a global hub for the pharma industry

Government Initiative A high-level inter-ministerial group chaired by the Indian Prime Minister, Dr Manmohan Singh, has decided to continue with the 100 per cent foreign direct investment (FDI) regime in the pharmaceuticals sector. "There is going to be no cap. 100 per cent FDI would be allowed," highlighted Mr Arun Maira, Member, Planning Commission. Marking a new trend of investments from foreign players in the Indian pharma sector, the need for overseas investors to get a no-objection from their JV partner before venturing out on their own or roping in another local firm has been removed by the Pharmaceuticals Export Promotion Council. It is expected that this measure will promote the competitiveness of India as an investment destination and be instrumental in attracting higher levels of FDI and technology inflows into the

country. The pharmaceutical industry has asked the Centre to incentivise the sector to encourage higher spending in research and development and bring down taxes and duties on life saving drugs and active pharmaceutical ingredients (API) to provide a stimulus to its growth. Currently, Indian pharma industry's annual market size including export is Rs 1 trillion (US$ 20.33 billion) with over 8,000 small and medium enterprise (SME) units engaging in this sector, said N R Munjal, the former President, Indian Drug Manufacturers' Association. Furthermore, a 'Pharma Vision 2020' has been prepared by the Department of Pharmaceuticals, for making India one of the leading destinations for end-to-end drug discovery and innovation and for that purpose provides requisite support by way of world class infrastructure, internationally competitive scientific manpower for pharma research and development (R&D), venture fund for research in the public and private domain and such other measures. In addition, the Union Minister of Commerce and Industry and Minister of Trade and Industry, Singapore, have signed a 'Special Scheme for Registration of Generic Medicinal Products from India', which seeks to fast-track the registration process for Indian Generic medicines in Singapore. On back of a high middle-class population base, improvements in medical infrastructure and the establishment of intellectual property rights, the Indian pharma industry is estimated to grow manifolds. With the focus of companies shifting to smaller deals catering to niche segments and markets, partnerships seems to be the new norm in the pharmaceutical sector. The strategic execution of maximising on the available resources both human and financial will be the way forward for clinical and contract research building capabilities

through strategic partnerships, stated Dr Abhijeeth Chandrasekaran, Clinical Scientist, RxMD. Interestingly, the international drug-makers have introduced generic or low-priced version of popular medicines and have also decreased prices of their existing products - in order to increase their share in the globally important market - India. The Indianmakers business model is built around selling large volume of cheap generic medicines at lower margins in the country, to add to twin purpose of affordability and popularity. "The industry posting healthy growth consecutively for the second year reflects the inherent strengths of the industry and improving healthcare standards in the country... demand for drugs and pharmaceuticals is on the rise, and is likely to continue next year as well," as per Ganesh Nayak, Executive Director, Zydus Cadila.

Real Estate
IThe Indian economy has witnessed robust growth in the last few years and is expected to be one of the fastest growing economies in the coming years. Demand for commercial property is being driven by India's economic growth. Real estate in India contributes about 5 per cent to India's gross domestic product (GDP). The total revenue generated in 2010-11 stood at US$ 66.8 billion. Demand is expected to grow at a compound annual growth rate (CAGR) of 19 per cent between 2010 and 2014Tier 1 metropolitan cities are projected to account for about 40 per cent of this. Growing requirements of space from sectors such as education, healthcare and tourism provide opportunities in the real estate sector. FDI of more than US$ 9 billion was infused in real estate in the last decade. In 2010, over 11 per cent of total FDI in India was in the real estate sector. There

have been 110 deals in this sector during the period 2001 to the first half of 2011. Urban population has been increasing and is expected to cross 590 million by 2030. Urbanisation and growing household income are some of the major factors that influence demand for residential real estate and growth in the retail sector. Investments Real estate emerged as the popular sector for private equity funds who invested US$1,700 million in this sector during 2011. Private equity in real estate projects will fetch considerable returns by next year-end or early 2013, as per Vikram Hosangady, Partner, KPMG. Some of the recent investments in this sector are mentioned below:

Sahara India has joined hands with the US-based Turner Construction Company. The JV, Sahara Turner Construction, will build integrated townships called Sahara City Homes and other Sahara India projects in India worth US$ 25 billion over the next 20 years

DLF acquired the additional 26 per cent stake in its joint venture companyDLF Hotels & Hospitality Ltd (DHHL)from Aro Participation Ltd and Splendid Property Company Ltd, affiliates of Hilton International. At present, the company holds 74 per cent equity in DHHL

Pride Group of Hotels, which owns a chain of upscale mid-market and business hotels is planning to set up a series of new properties and this will involve an investment of Rs 1,000 crore (US$ 203.18 million) over the next few years. The company plans to have a mix of owned and managed properties having 3,500 rooms by 2015-16

Government Initiatives

The foreign direct investment (FDI) up to 100 per cent is allowed with Government's permission for developing townships and settlements

New home loan borrowers of up to Rs 1.5 million (US$ 30,477) will get Rs 14,865 (US$ 302) as interest subsidy from the Government, on the condition that the cost of the house should not exceed Rs 2.5 million (US$ 50,798)

Allowing 100 per cent FDI under the automatic route in development of Special Economic Zones (SEZ), subject to the provisions of Special Economic Zones Act 2005 and the SEZ Policy of the Department of Commerce

In the Union Budget 2011-12, Mr Pranab Mukherjee, Union Finance Minister presented various initiatives for the real estate sector, especially focussing on affordable housing. Some of these initiatives are listed below:

Increasing the limit on housing loans eligible for a 1 per cent subsidy in interest rates Widening the scope for housing under "priority-sector lending" for banks, making interest rates cheaper on them Allocating substantial amount to the Urban Development Ministry for spending on extension of Metro networks in Delhi, Bengaluru and Chennai Earmarking US$ 20.03 million for the urban infrastructure development project. The Urban Development Ministry received US$ 1.5 billion, an increase of US$ 68.53 million from the last fiscal 2010-11

Real estate plays an important role in the Indian economy. This sector happens to be the second largest employer after agriculture and is expected to grow at the rate of 30 per cent over the next decade. The size of the Indian real estate market is expected to touch US$ 180 billion by 2020. The housing sector alone contributes to 5-6 per cent of the India's GDP. Retail, hospitality and commercial real estate are also growing considerably, providing the much-awaited infrastructure towards India's growing needs. According to a study by ICRA, the construction industry in India ranks 3rd among the 14 major sectors in terms of direct, indirect and induced effects in all sectors of the

economy. A unit rise in construction spending generates five times the income, having a multiplier effect across the board. With backward and forward linkages to over 250 ancillary industries, the positive effects of real estate growth spread far and wide. Therefore, real estate acts as a catalyst for adding momentum to growth of the Indian economy. \

Science and Technology

India is one of the top-ranking countries in the field of basic research. The Indian Research and Technology Sector is regarded as one of the most powerful instruments of growth and development, especially in context of the emerging scenario and competitive economy. With an annual growth of over 12 per cent in the number of scientific publications in Science Citation Indexed journals during the last three years, India posted a significant improvement in its global ranking. Also, with respect to the number of publications and filing of patents by Indian researchers in the USA and Organisation for Economic Co-operation and Development OECD countries, there is a relative improvement in the ranking of India. A significant increase in the number of PhD outputs in the country has been reported during the last five years. The Department of Science and Technology, Government of India (GOI), holds a 50 per cent share in the Extra Mural Research funding in the country. As a result of the various initiatives taken by the GOI and the Ministry of Science and technology, there has been an increase of more than 250 per cent in the number of proposals received by the department indicating an expansion of R&D and stake holder bases. Innovative Clusters Enterprising initiatives in setting up Information & Communication Technology (ICT) clusters in the National Capital Region (NCR) have led to comprehensive mapping of more than 4,000 cluster stakeholders as stated in the Annual Report 2010-2011 by the Ministry of Science and Technology. A Network of ICT Entrepreneurs and enterprises (NITEE) has been formed to mentor support to more than 50 innovative entrepreneurs, and support to more than 100 entrepreneurs for participation in market development and networking events. Government Initiatives

The Union Budget proposal to extend the weighted tax exemption for in house Research and Development (R&D) by another 5 years to the year 2017 is expected to encourage pharmaceutical companies to invest more in the field of research and development. The budget has extended the weighted tax exemption for in house R&D, which is a significant step in promoting R&D companies to invest more in research and development

In the Union Budget 2012-2013, the three Departments of Science and Technology, Scientific and Industrial Research and Biotechnology under the Ministry of Science and Technology have each got a hike of about 10 per cent over the revised estimates or the actual expenditures during the current financial year

The Department of Space and the Ministry of Earth Sciences, in charge of the India Meteorological Department and polar and ocean-related research and development respectively, have received an increase of 64 per cent and about 50 per cent respectively

The Department of Atomic Energy has seen a hike of about 18 per cent in the current Union Budget. The Budget estimate for the coming year for the Department of Atomic Energy, is Rs 11,673 crore (US$ 2.32 billion), as against the Budget estimate of Rs 10,012 crore (US$ 1.99 billion) and revised estimate of Rs 9,895 crore (US$ 1.97 billion) for the current fiscal

The Budget estimate for the coming year for the Department of Space is Rs 5,615 crore (US$ 1.11 billion), as against the Budget estimate of Rs 5,700 crore (US$ 1.13 billion) and revised estimate of Rs 3,432 crore (US$ 684.14 million) for the current fiscal

The corresponding figures for Ministry of Earth Sciences Rs 1,281 crore (US$ 255.36 million), Rs 1,220 crore (US$ 243.20 million) and Rs 855 crore (US$ 170.41 million), Department of Biotechnology Rs 1,485 crore (US$ 295.99 million), Rs 1,400 crore (US$ 279.02 million) and Rs 1,350 crore (US$ 269.06 million), Department of Scientific and Industrial Research Rs 2,013 crore (US$ 401.28 million), Rs 1,930 crore (US$ 384.73 million) and Rs. 1,830 crore (US$ 364.79 million) and Department of Science and Technology Rs 2,477 crore (US$ 493.72 million) Rs 2,349 crore (US$ 468.24 million) and Rs 2,252 crore (US$ 448.83 million)

Other Initiatives

Initiated by the Unique Identification Authority of India (UIDAI), agency of the

GOI, the AADHAAR scheme is responsible to maintain a database of residents containing biometric and other data. This project promises the potential to position India as the innovation leader. The project will contribute largely in delivering the benefits of development to masses and is linked to several important schemes such as MG-NREGA, PDS and other Financial Inclusion initiatives. The 13 per cent increase in allocation to the UID project is indicative of government's commitment and will benefit the IT sector immensely

The Government of India and Africa held the 1st India-Africa S&T Ministers' Conference and Tech Expo for better understanding and cooperation in the field of science, technology and innovation. The India Africa Summit also offered the opportunity for science and engineering students at the Masters and PhD levels from Africa to undertake student internships in Indian research institutions

In another initiative by the Government of India, to enhance trade relations with the Republic of Iran, and develop renewable energies, has outlined an agenda for generating power through use of renewable energies, especially wind and solar. In a meeting between the ministers of the two countries, Dr Farooq Abdullah, Union Minister of New and Renewable Energy, highlighted the progress of India's National Solar Mission which has resulted in significant increase in installed capacity and an almost 40 per cent fall in costs

Recent Developments

Among the recent developments, scientists from India and Australia participated in a workshop on 'Preparing for climate change on marine systems in Australia and India'. Funded by the Australia-India Strategic Research Fund, the aim of the workshop is to bring together an inter-disciplinary research team from both countries to improve understanding on the impacts of climate change on marine resources and stakeholders

Intel, an American multinational semiconductor chip maker, headquartered in

Santa Clara, California, United States recently launched the Future Scientist programme. The company will work with leading NGOs, social organisations and State Governments to execute the roll out of the programme and reach close to 50,000 girls and help them develop scientific skills and expertise

Delegations from India and Japan recently met in order to strengthen the ties between the two nations. Members from various sectors of the Japanese establishment attended the meet which was aimed to establish a Global and Strategic Partnership between India and Japan

As stated by Mr Ashwani Kumar, the Minister of State for Science and Technology, the Government of India will triple the budget allocated for research and development in the Twelfth Five Year Plan. The expenditure in the sector will be almost tripled from Rs 33,000 crore (US$ 6.57 billion) in the Eleventh Five Year Plan to around Rs 90,000 crore (US$ 17.93 billion) in the Twelfth Five Year Plan. Further, 2 per cent of the gross domestic product (GDP) for research in the science and technology sector in the 12th Five Year Plan from April 2012-March 2017 will be spent against the current spending of 0.98 per cent. The Government has also taken steps to improve the private sector funding in the R&D sector, and has subsequently held meetings with top companies to address the issue and a task force has been set up. For the next five years, the focus of the Ministry is in areas of nano-sciences, genomics, neuro sciences, biotechnology, clean technology and water.

Oil & Gas

India is the fifth largest consumer of energy in the world, and is likely to surpass Japan and Russia to become the world's third biggest energy consumer by 2030. According to the International Energy Agency (IEA), hydrocarbons satisfy major energy demand in India wherein coal and oil, together, represent about two-thirds of total energy use. Natural gas accounts for about 7 per cent share. According to Oil & Gas Journal (OGJ), India has about 5.7 billion barrels of proven oil reserves. India's oil and gas sector has attracted investors round the globe as the country enjoys rich reserves of resources. The petroleum and natural gas industry in India has attracted foreign direct investment (FDI) worth US$ 3, 332.78 million during April 2000 to December 2011, according to the data provided by Department of Industrial Policy and Promotion (DIPP). The Department further recorded US$ 196 million during April December 2011-12, in the industry. Oil & Gas- Market Dynamics Production and Consumption According to the provisional production data released by the Ministry of Petroleum and Natural Gas in a press release:

Crude Oil production was recorded at 31.87 million metric tonnes (MMT) for April-January 2012, as compared to the 31.41 MMT in April-January 2011 Natural Gas production was 40, 156.7 million cubic metres (MCM) during AprilJanuary 2011 During April-January 2012, 140.73 MMT of crude oil was refined, compared to 136.49 MMT of oil refined during corresponding period in 2011

According to Business Monitor International (BMI)'s India Oil and Gas Report for first quarter of 2012, India's average oil and liquids production for 2011 is estimated at 1.04 million barrels per day (B/D) which will touch the peak production at 1.06

million B/D in 2012. Further, giving its demand outlook, BMI projects consumption to rise sharply to 4.29 million B/D by 2016 from 3.44 million B/D in 2011. Total gas consumption is estimated by BMI at around 81 billion cubic meters (BCM) in 2016 from around 58 BCM in 2011. Diesel & Petrol Around 40 per cent of fuel consumption in India is satisfied by diesel. According to IEA, there would be an increase in India's fuel demand by 3.8 per cent which would be majorly accounted by diesel and petrol (gasoline). IEA expects diesel's demand to have increased to 1.37 million b/d in 2011 (rising by 5.8 per cent) and further it projects an increment of 5.5 per cent in 2012 at around 1.44 million b/d. Demand for petrol is expected to have expanded by 7.6 per cent (363,000 B/D) in 2011 and is projected to increase by another 6.7 per cent (388,000 B/D) in 2012. The Ministry of Petroleum anticipates a growth of 4.6 per cent in the sale of oil products in the FY12. Gas Development of gas-fuelled power stations in India is boosting the demand for gas in the country. BMI states that gas consumption in India has increased by more than 160 per cent since 1995 while average annual demand would grow by 6 per cent over next few years. Gas production is estimated at 50 BCM in 2011 while total gas consumption is predicted at 81 BCM in 2016 from an estimated 58 BCM in 2011 by BMI. India's Directorate General of Hydrocarbons (DGH) has given its nod to GSPC to develop Deen Dayal gas field in the KG Basin. The block is estimated to hold reserves of around 56.6 BCM and gas production from the same is anticipated to annualise at 2.1-3.1 BCM. Oil & Gas - Key Developments and Investments

Energy giant Reliance Industries Ltd (RIL) is in full force to strengthen its global leadership position through its ambitious US$ 11 billion-Jamnagar phase three expansion project (popularly known as J-3 mega petrochemicals project). The company has approached international markets to raise funds for the same. Recently, RIL officials have signed a US$ 400 million-loan agreement with

Italian finance group SACE Spa

State-run Indian Oil Corporation (IOC) plans to expand its pipeline network (from 10,900 km to 15,000 km) by investing Rs 7,700 crore (US$ 1.55 billion) by 2015. The company would lay more than 20 new pipelines to materialise its expansion plan.

Further, IOC is contemplating to set up a refinery with a capacity of 15 million tonnes per annum (MTPA) in Gujarat by entailing an outlay of Rs 30, 000 crore (US$ 6.02 billion)

Oil & Natural Gas Corporation (ONGC) and IOC are eyeing exploration and refining opportunities in Sri Lanka as the island's Government would call for bids for seven oil and gas blocks in Mannar Basin by June 2012. Both the companies are reported to have visited Sri Lanka to review the opportunities and discuss the prospect with concerned authorities

After setting up two terminals on the western coast, Petronet LNG Ltd is planning to set up its third terminal in the east coast of India. The terminal, with a 5 million tonne capacity, is projected to cost around Rs 4, 500 crore (US$ 902.9 million)

Oil & Gas - Government Initiatives Indian Government has encouraged Saudi Arabia to get involved in the country's petroleum upstream and downstream sector, revealed Mr R P N Singh, Minister of State for Petroleum & Natural Gas. In recent bi-lateral talks between the nations, investment opportunities discussed included OPaL's Petrochemical project at Dahej, OMPL's Petrochemical project at Mangalore, IOC's LNG project at Ennore, Bharat Petroleum Corporation's LNG terminal at Kochi, Hindustan Petroleum Corporation's grass-root refinery in Visakhapatnam and IOC's petrochemical plant at Paradeep. The Andhra Pradesh Government has recently inked Memorandums of Understanding (MoUs) pertaining to oil and gas sector. While GMR Group proposed to invest Rs 33,000 crore (US$ 6.62 billion) for setting up a 15 million tonne refinery-cum-petrochemicals complex and a multi-product special economic zone (SEZ) in the state, BR Shetty

Group expressed interest to invest another Rs 33,000 crore (US$ 6.62 billion) to put up a refinery project at the PCPIR region in Visakhapatnam. The state Government has also signed an MoU with State-run GAIL India's subsidiary GAIL Gas under which the company would establish 3.5 MTPA-capacity LNG terminal in the east coast with an estimated investment of Rs 5,000 crore (US$ 1 billion). Oil & Gas - Road Ahead Mr S Jaipal Reddy, Junior Oil Minister, India, expects investments worth US$ 75 billion in South Asian nation's oil and gas sector from April 2012 to March 2017 as the country is ramping up its exploration, production, refining, marketing, storage, petrochemicals and related engineering activities to increase availability of petroleum and petroleum products. Eventually, the development plan will also cut India's import bill.

FOOD INDUSTRY
The Indian food and drinks market has witnessed strong growth over the past few years. Liberalisation of the economy and growing income of middle class population have had a positive impact on consumer spending and consumption in both rural and urban areas. Indian consumers now spend a significant proportion of their income on food and other essential commodities. Numerous other factors like demographic and macro-economic conditions have also given boost to expenditure on food and beverages in the country. The total food production in India is expected to double in the next ten years and there is ample opportunity for huge investments in food and food processing technologies, skills and equipments. The food processing industry in India stands at US$ 135 billion and is projected to grow with a compound annual growth rate (CAGR) of 10 per cent to reach US$ 200

billion by 2015. The food industry is divided into various segments namely, milk and allied products (dairy), meat and poultry, seafood, bakery and confectionery, fruit and vegetables, grain, pulses and oilseeds (staple) products, alcoholic and non-alcoholic products (beverages), and packaged food. The food processing industry in India is witnessing quick growth. In addition to the demand side, there are changes happening on the supply side as well with the growth in organised retail, increasing foreign direct investment (FDI) in food processing and introduction of new products. The growth has happened because the Government of India has given a priority status to all agro-processing businesses. Government incentives in the field of mega food parks, cold chain and exports benefits are also playing an important role in encouraging food processing. Key Players The major players operating in the Indian food and beverages industry include Dabur India Limited, Godrej Industries Limited, Hindustan Lever Limited, Britannia Industries Limited, ITC Limited, Nestle` SA, PepsiCo, Inc, Cadbury Schweppes PLC, Future Group, RPG Enterprise and Godrej Agrovet Limited. Food Processing Industry Food processing industry is one of the major sectors in India in terms of production, growth, consumption, and export. The turnover of the total food market is approximately US$ 69.4 billion out of which value-added food products comprise US$ 22.2 billion. India's food processing sector covers fruit and vegetables; spices; meat and poultry; milk and milk products, alcoholic beverages, fisheries, plantation, grain processing and other consumer product groups like confectionery, chocolates and

cocoa products, soya-based products, mineral water, high protein foods etc. India is the world's largest producer of milk, second largest producer of fruits and vegetables and the third largest fish producer and it ranks second in inland fish production. With a huge agriculture sector, abundant livestock, and cost competitiveness; India is fast emerging as a sourcing hub of processed food. India produces 200 million tonnes (MT) of food grains each year. India's comparative advantage lies in its favourable climate, geographic location - it is geographically close to key export destinations (Middle East, South East Asia), large agriculture sector and livestock base, long coastline, and inland water resources. Government of India anticipates US$ 21.9 billion of investments in food processing infrastructure by 2015. Investments, including foreign direct investment (FDI), will rise with strengthening demand and supply fundamentals. The FDI inflow into agriculture and food processing during April 2000-April 2011 was US$ 4 billion. Beverages According to a report titled "Indian Non-Alcoholic Drinks Forecast to 2012" by research firm RNCOS, the Indian non-alcoholic drinks market was estimated at around Rs 216 billion (US$ 4 billion approximately) in 2008 and is forecasted to grow at a CAGR of around 15 per cent during 2009-2012. The report covers numerous factors driving the growth of non-alcoholic drinks market in India. According to findings of the report the highest growth will be seen in the fruit/ vegetable juice market, which is forecasted to grow at a CAGR of around 30 per cent in value terms during 2009-2012, followed by the energy drinks segment at a CAGR of around 29 per cent during the same period. Investments

Quick service restaurant company Dunkin' Brands will localise its menu in India

to have savoury products, according to John Costello, Chief Global Marketing and Innovation Officer, Dunkin Brands. Costello said that India's economy and a growing middle class presented a significant opportunity for the US$ 8.4 billion company to partner Jubilant Foodworks and the Indian firm's success with Dominos Pizza added to it. It plans to have 500 Dunkin' Donuts outlets in India over the next 15 years

The world's largest fast-food chain - McDonalds, is shedding its familiar red and yellow colour for more muted tones as it goes for its biggest and costliest revamp in India, in line with its global strategy of attracting more adults. The red and yellow company logo will be replaced with white across 240 restaurants

Packaged foods maker Nestle India announced the launch of one of its global programmes, Nestle India, to assist coffee farmers and help it optimise its coffee supply chain. It launched the first Nescafe coffee demo farm and training centre in Karnataka under the initiative

Australia's fastest-growing and most-awarded coffee company, Di Bella Coffee, plans to enter the Indian market with at least six cafs in Mumbai in January 2012. "Our target is the youth. We would offer free internet usage per cup of coffee," as per Sachin Sabharwal, Managing Director, Di Bella Coffee India Pvt Ltd

Government Initiatives According to the recently announced Union Budget 2012-13 following initiatives will be taken by the Government: National Mission on Food Processing

A new centrally sponsored scheme titled "National Mission on Food Processing" to be started in 2012-13 in co-operation with State Governments Steps taken to create additional food grain storage capacity in the country Subsidies fully provided for effective administration of the proposed Food

Security Legislation

To promote private sector activity and invite foreign investments in the sector the Government allows 100 per cent FDI in the food processing & cold chain infrastructure

India is one of the fastest growing branded restaurants markets in the world, where the organised eating-out market is estimated at US$ 2 billion and growing at a CAGR of 25 per cent. With massive scope for value addition, growing trend in the consumption pattern of processed food products in India and many fiscal incentives being planned by the Government, this sector is capable of maintaining the growth momentum in the future.

Abhay kumar Prajapati

Kushinagar,Uttar-Pradesh. India
E-mail id: abhaykrprajapati@gmail.com : abhay.prajapati@hotmail.com