Wipro's Vivek Paul is in exalted company. Alongside Apple's Steve Jobs, NBC Chairman Bob Wright, Craig Barret of Intel and Starbucks CEO Orin Smith, Business Week magazine has rated Paul as one of the best managers of 2003 in its latest issue. The Wipro vice-chairman and president has been lauded for taking the company to where it's at today. When Paul joined Wipro, 84% owned by Azim Premji, in August, 1999, it was just a $150 million company. Today, it is almost $1 billion. His strategy of growth by acquisition has helped Wipro steal business from the likes of IBM Global and Accenture, says the magazine. Paul joined Wipro as the CEO of Wipro's global information technology, product engineering, and business process services segment. Under Paul, Wipro's global service segment has grown at over 45 per cent a year. It became a globally recognised brand name. The company went for an IPO on the NYSE in 2000 and currently has a market cap of $6 billion. When Paul joined Wipro it was an obscure, $150-million Indian software services and hardware company' which `today it is a $1-billion giant', it observed.

Courtesy: www.timesofindia.com, January 08, 2004

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After outsourcing it is undercutting, and India is at the centre of both buzzwords in the global economy. Recently, one British company was quoted as offering 100,000 pounds to carry out a software audit. An Indian group offered to do the same job for 30,000 pounds. The work was carried out by four software professionals coming in from India. A top Birmingham business chief has now sounded the alarm over the threat of cut-price operators snatching work from lawyers and accountants. David Grove, president of Birmingham and Solihull Chamber of Commerce, claimed that many businesses in the sector were ignorant of the threat facing them from India and China.

Courtesy: The Economic Times, January 08, 2004

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The pecking order in the passenger vehicle segment - consisting of cars, utility vehicles (UV) and multi-purpose vehicles (MPV) - has seen some significant changes during the January-December '03 period. While Tata Motors, Toyota, Ford, Honda and General Motors moved up the ladder in '03, Hyundai, Hindustan Motors and Fiat slipped down a few notches. Suzuki, Mahindra & Mahindra, Skoda, Bajaj Tempo and DaimlerChrysler retained their '02 positions in '03. Observers cited value-for-money pricing and fuel-efficiency as the sales drivers for most auto majors over the past few months. Total sales in the passenger vehicle segment rose to 840,650 units in '03 from 696,300 in '02. Desi major Tata Motors has moved up from the third position in calendar '02 to second place in '03, overtaking Korean major Hyundai Motor India, while Toyota has moved to No 5 from sixth position. Ford and Honda have moved up to sixth and seventh positions, respectively in '03, from eighth and ninth in '02.

Courtesy: The Economic Times, January 08, 2004

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The 10th Partnership Summit of the Confederation of Indian Industry (CII) began here on Wednesday amid confident declarations by the policy and decision makers that India would be one of the three top economies of the world in one-and-half decades. Deputy Chairman of Planning Commissioner K C Pant, who inaugurated the important annual gathering of the business leaders, Industry captains, foreign business delegates and other prominent persons from different walks of life, referred to the Goldman Sachs latest report forecasting that India would be among the three top economies by 2040. Mr Pant said the present GDP growth rate of the country and various other factors point out that India would achieve this target much before that, possibly by 2020. In fact, the Goldman Sachs 'BRIC' report on the emergence of Brazil, Russia, India and China as the top four economies of the world, was the point of reference for most speakers at the plenary of the three-day Summit. Pointing out that the growth rate in the second quarter of the current fiscal was 8.4 per cent, Mr Pant said the Goldman Sachs report was based on the much more moderate growth rate of about 4.5 per cent while India's economy was growing much faster at a rate of eight to nine per cent. "The tenth Five Year Plan for the period of 2002-2007 is aimed at making India the fastest growing economy. The country has the capacity to grow at an average of eight per cent during the Plan, rising above nine per cent in the terminal year," he said. He was confident that the growth rate would touch a high of nine per cent during the last two quarters of the current year itself.

Courtesy: The Pioneer, January 08, 2004

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American accounting and medical billing firms are the latest to join the outsourcing bandwagon, transferring lakhs of jobs to India to take advantage of the low pay scales and educated workforce in the country. In 2002, accounting firms sent some 25,000 tax returns to be completed by accountants in India. This year, that number is expected to quadruple. In fact, companies in a number of unexpected industries are now sending work overseas. From scientific lab analysis to medical billing, the service-sector workforce has gone global, the CNN report said. Increasingly, medical billing for US firms is being done by staff in India. Alpha Thought International, a Chicago-based medical billing firm with workers in the US, opened a billing office two years ago in New Delhi where staff do data entry work needed to process insurance and other medical billing claims.

Courtesy: The Times of India, January 07, 2004

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World's third largest oil firm Royal Dutch/Shell will source petrol and diesel from Mangalore Refinery and Petrochemicals Ltd for its upcoming 2,000 petrol stations in the country. Shell India Pvt Ltd, on January 5, signed a memorandum of understanding with MRPL, a subsidiary of Oil and Natural Gas Corp (ONGC), for buying transport fuels, sources in MRPL said here. ONGC, which plans to fuel its upcoming 1,100 petrol pumps throughout the country from the 9.69 million tonnes Mangalore refinery, is in the process of setting up storage and other marketing infrastructure and the MoU with Shell will help avoid duplication of the costly infrastructure. "The agreement with Shell will provide an outlet for the refinery to operate on its optimal capacity without having to resort to exports at a discount. MRPL, which is operating at over 100 per cent capacity after being taken over by ONGC in March last year, is the second largest exporter of petroleum products in the country after Reliance Industries Ltd (RIL). It exported 1.9 million tonnes of petroleum products in the first nine months of current fiscal.

Courtesy: The Economic Times, January 07, 2004

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The Indian economy is expected to experience strong growth ahead, as indicated by the seventh consecutive rise in the DSE-ECRI Indian Leading Index. Furthermore, the recent rise in the index predicts continuation of growth in the economy in the coming months. The Leading Index has been rising since March, when it stood at 175.4, to 190.3 in August and 193.7 in September. Its growth rate also rose for the seventh consecutive month to 14.3% in September and 12.4% in August, from 2.5% in March. The DSE-ECRI Indian Coincident Index, which moves in tandem with the economy so that its peaks and troughs roughly coincide with those of the economy itself, grew by 4.3% in both August and September, up from 2.9% in March. This pick-up in economic growth was correctly predicted by the rise in the Leading Index since early 2003, as mentioned above. The performance of the external sector was also accurately predicted by the DSE-ECRI Leading Index for Exports, that captures the combined impact of global demand and the value of the rupee on India's exports. In sum, the Indian economy is looking forward to a robust expansion in the months ahead. Rising export growth, based on a global recovery, is also likely to provide an important impetus. Thus, the prevalent feel-good factor in the Indian economy has a solid foundation.

Courtesy: The Economic Times, January 07, 2004

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The government on Wednesday said buoyed by a bountiful monsoon and progressing sowing of grains and oilseeds, it was expecting an all-time high crop production, in the 2003-04 season with projections of it increasing to 320 million tonnes in 2011-12. Oilseeds output is projected to rise to 46 million tonnes in 2011-12 from 21.3 million tonnes in 2000-01. The existing record for grains production in 2001-02 when the output touched 212.03 million tonnes will be broken, he added. He said an action plan has been devised to double food production by the end of the 10th Five Year Plan. The goal would be achieved by promoting diversification, value addition and expansion of gross cropped area in high potential and productivity zones and through water management, soil conservation and integrated nutrient management in low productivity areas. During the current and next five year plans the growth projection for oilseeds output was 7.25 per cent and the corresponding figures for wheat and rice was 4.08 and 3.66 per cent respectively. "Accordingly wheat output to rise to 112.5 million tonnes in 2011-12 and 129 million tonnes in case of rice".

Courtesy: The Economic Times, January 07, 2004

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The Indian economy, Asia's third-largest, is set to expand by nine per cent in the second half of the financial year ending March 2004, the deputy head of the national planning commission said on Wednesday. "It is expected to grow by nine per cent in the remaining two quarters," commission Deputy Chairman K C Pant told a business seminar. The economy expanded by a robust 8.4 per cent in the July-September quarter, the second quarter of the fiscal year. It grew 5.2 per cent in the corresponding period last year. The government expects the economy to expand more than seven per cent in 2003-04, boosted by the best monsoon in a decade.

Courtesy: The Economic Times, January 07, 2004

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Using acquisition as a key strategy, Indian software vendors are expanding their global reach. In tune with this present trend, Cranes Software International (CSIL), the Bangalore-based vendor of scientific and engineering software products and solution, has bought the Sigma suite of products from SPSS Inc for $13 million. Sigma-series products are used by scientists and engineers for data presentation and analysis. These offerings compliment Cranes Software International's current portfolio of scientific and engineering software products such as SYSTAT, TableCurve2D, TableCurve3D and PeakFit. Sigma-series has an established base of over 100,000 users with significant brand awareness in the pharmaceutical and biotechnology marketplace. Though CSIL has the capability of developing such products from the scratch, the acquisition route was chosen as the products come with a global brand name, which shrink wrapped (ready to use) software products otherwise made in India will need a long time to attain global image. CSIL closed last fiscal with revenues of Rs 61 crore. In the first half of the current fiscal its revenues were Rs 32 crore. It has 250 plus professionals on rolls.

Courtesy: The Economic Times, January 07, 2004

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India is on a strong footing and there are numbers to support this statement. The Central Statistical Organisation certified that GDP growth for the second quarter of financial year 2004 was 8.4%. This figure came as a pleasant surprise and especially after a 5.7% growth witnessed last quarter. The biggest contributor to this growth was the services sector, which grew by 9.9% followed by the agricultural sector at 7.4% and then by industry at 6.7%. The services sector in India accounts for more than 50% of the GDP and a 9.9% growth in this sector is a positive trend. This growth was boosted by an 11.9% growth in the trade, hotels, transport and communication sector followed by an 8.9% growth in the community, personal and social services sector. The industrial sector showed a healthy increase due to good performance by the manufacturing and construction sectors but the electricity, water and gas sectors were disappointing and showed a decline to 2.9%. More good news has come in from the Balance of Payments (BoP) figures. The BoP surplus has risen to Rs 10,755 crore due to a high capital surplus. The capital surplus rose to Rs 3,375 crore during the quarter ended September 2003 as compared to the Rs 2,430 crore figure for the June 2003 quarter. This sharp rise can be attributed primarily to the FII equity inflows and other debt creating capital inflows. The current account is also showing a surplus of Rs 2,358 crore for the September 2003 quarter against a Rs 1,426.5 crore deficit in the June 2003 quarter. This surplus is on account of lower imports of services.

Courtesy: The Economic Times, January 07, 2004

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Rodenstock, the German eye lens and spectacle frame manufacturer, plans to outsource a portion of its global requirements to India. Rodenstock has entered into an arrangement with Kolkata-based GKB Rx Lens to have its lens manufactured in India for the domestic market and is exploring south and south East Asian countries for exports from the country. As part of the deal, Rodenstock would supply raw materials to GKB that, in turn, would be converted into eye lens and sold under the Rodenstock brand, GKB's marketing director Lalit Gupta told ET. According to him the current size of the Indian optical market is estimated to be about Rs 1,000 crore. In the last six months, GKB has opened five new outlets in Delhi, Bangalore and Kolkata, taking the total to 14. Mr Gupta said the company has manufacturing facilities in all major cities, including Kolkata, Delhi, Mumbai, Chennai, Bangalore, Hyderabad and Kochi.

Courtesy: The Economic Times, January 06, 2004

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Close on the heels of acquiring France-based RPG Aventis, Ranbaxy has now set its eyes on acquiring branded generic drugs in the US. The company is mainly looking for niche-branded generic products in antibiotics and urology segments. The company is evaluating inorganic growth opportunities is some of the European markets where the company's operations are currently below the critical mass. The company also announced completion of all necessary formalities for the acquisition of RPG (Aventis) SA. With this, RPG (Aventis) SA, France, has now become a wholly-owned subsidiary of Ranbaxy, a company statement issued today said. The company will continue to retain the name RPG to leverage its strong brand equity and visibility in the French generic market. Ranbaxy will be investing additional resources on the ground and will further strengthen and grow this business in the French market, the statement added. On December 13, 2003, Ranbaxy had announced the signing of an agreement to buy RPG (Aventis) SA in France.

Courtesy: The Economic Times, January 06, 2004

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Did someone say India can't beat China? Here's over to Porter for a change of thought. The country steals a clear march over the arch-rival in Porter's study. The micro-economist who has studied economies of several countries rates India above China in terms of economic potential. In a report on Global Competitiveness, published by World Economic Forum in the year 2000, Porter along with Jeffrey Sachs highlighted many distinct parameters to evaluate a nation's economic potential. To provide a scientific basis to their method, Porter and Sachs devised two indices: Current Competitive Index [CCI], which reflected whether a nation can sustain its current economic growth rate, and Growth Competitive Index [GCI], which told whether the nation can exceed this growth rate. The report placed India 37th against China's 44 in CCI while India ranked 49th to China's 41 in terms of GCI. The report showed that while India may sustain its current growth rate. For Porter what drives an economy in the long run, are factors that enable increasing efficiencies of capital. Frenetic investments in material assets like factories, roads, hotels and airports may do not necessarily lead to either sustainable growth or even short-term big growth.

Courtesy: www.economictimes.com, January 06, 2004

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India is likely to benefit from an exodus of high tech jobs from North America as over 6 million jobs are expected to shift overseas in a decade. ''In the next decade, as many as 6 million jobs might be sent to India and other nations by US companies in search of lower costs and a tech-savvy, English-speaking workforce,'' Goldman Sachs Group Inc said in a recent report. ''The shift of North American technology jobs to low wage countries like India cannot be stopped because not only are Indian companies a third of the cost, but they actually are better'', said Pradeep Sood, president of Indo-Canada Chamber of Commerce. Indian workers earn as little as one-tenth of their North American counterparts, and India produces 67 per cent more engineers and computer scientists each year than the US, said Sood, suggesting that India should take full advantage of its low salaries and skilled work force. A number of multinational corporations like Microsoft, Intel, Accenture Ltd and GM Motors have already started taking advantage of cheaper costs in India.

Courtesy: The Indian Express, January 06, 2004

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Constrained by policy from investing in the domestic market outside Delhi and Mumbai, cash-rich Mahanagar Telephone Nigam Ltd (MTNL) is expanding abroad in a big way. It has won licences for operating cellular mobile, WLL and international long distance (ILD) services in Mauritius. It has also acquired licence for providing fixed line telecom services in Kenya and is providing CDMA-based mobile services in Nepal. It also plans to bid for licences in the Persian Gulf and CIS countries. The company has a cash reserve of Rs 2,300 crore. MTNL would be the first operator to offer WLL services based on CDMA 1x technology in Mauritius and would be the third operator in GSM-based mobile telephone services. "Our investments in Mauritius will be to the tune of Rs 100 crore," said Mr Sinha. He became MTNL's CMD in November. In Kenya, MTNL would provide fixed line services in a joint venture with state-owned Telecom Consultants India Ltd and a local partner. It would have 40% stake in the company.

Courtesy: The Economic Times, January 06, 2004

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Larsen & Toubro has secured an order valued at $30 million for upgrading the facilities at the Bu Hasa project of GASCO in Abu Dhabi. It will be responsible for total engineering, procurement and construction (EPC) involving new compressors and related facilities including hook up to meet additional gas supplies from the Bu Hasa field development. K. Venkataraman, member of the board and President (Operations), L&T, said the order represented a major breakthrough for L&T in the onshore gas field development sector and would enable the company to demonstrate its competencies in the field.

Courtesy: The Hindu, January 06, 2004

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Leading Congressman Frank Pallone begins a weeklong visit to India Tuesday in a bid to identify opportunities for Indian companies to invest in the US, especially his constituency New Jersey. He plans to visit the headquarters of Ranbaxy pharmaceutical facilities in New Delhi - a company that has invested and created jobs in the US. Describing Ranbaxy as "a leading pharmaceutical company that has expanded worldwide, including the US and in my home state of New Jersey," Pallone said in a statement that as "an Indian company that has invested in the US, worked hard to become one of the top 10 generic drug companies in the US, and created many American jobs.

Courtesy: The Economic Times, January 06, 2004

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India is likely to capture 56 per cent share of offshore business process outsourcing business by 2006 with the demand for BPO services increasing at an annual growth rate of 50 per cent during 2004-06, according to a report by rating agency ICRA. The size of the Indian BPO market is likely to be around $9-12 billion by 2006 and will employ around 400,000 people, ICRA said in its Indian BPO industry report. With a projection of 50 per cent annual growth for the BPO industry over 2004-06, the ICRA report said that established BPO players are likely to move up the value chain in quest for better price realisation. As these Indian firms scale up rapidly, ICRA expects that some of the big players in the market may use the IPO route to raise funds for moving up the ladder. It said a number of countries have emerged in the BPO segment like Australia, the Philippines, China and Ireland. However India is favourably placed as far as competitiveness is concerned.

Courtesy: The Economic Times, January 06, 2004

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The stock markets of Brazil, China, India and Russia could be as large as the combined markets of the world's four top economies by 2050, Standard Life Investments said on Monday. At present, the equity markets of Brazil, Russia, India and China (BRICs) account for just 5 per cent of the combined market values of the United States, Britain, Japan and Germany. Although strong growth is expected in the BRIC markets, the US is expected to remain the largest market by 2050, accounting for about 45 per cent of the total stock market universe. China, however, will have risen to become the second largest market, at 25 per cent, and India will rank third, at more than 10 per cent. The BRIC economies have potential to grow quickly from a relatively modest base, and real earnings growth in these economies is expected to outpace that of the more mature, developed markets. Labour costs can ensure relatively high returns on capital, while businesses can exploit new technology to catch up with their richer peers. The raising of new capital is also likely to be a powerful driver of the BRIC stock markets. Local currencies are also likely to appreciate in value due to foreign capital inflows, also boosting market values. ''Our assumptions....have led us to conclude that the Brazilian and Russian markets are likely to grow by an average annual rate of around 7 per cent in real terms expressed in US dollars, while India and China should achieve close to 10 per cent growth,'' the report said.

Courtesy: The Indian Express, January 06, 2004

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Management guru Peter Drucker has said India is becoming an economic powerhouse very fast and its progress is far more impressive than that of China. In an interview to the Fortune magazine, he said, "India is becoming a powerhouse very fast. The medical school in New Delhi is now perhaps the best in the world. And the technical graduates of the Institute of Technology in Bangalore are as good as any in the world." Also, India has 150 million people for whom English is their main language. So India is indeed becoming a knowledge centre, the 94-year-old management thinker said. Drucker has consulted with many of the world's largest corporations as well as with non-profit organisations, small and entrepreneurial companies, and with agencies of the US government. He has also worked with free-world governments such as those of Canada, Japan, and Mexico. In contrast, the author of 31 books on subjects dealing with society, economics, politics and management said, the greatest weakness of China is its incredibly small proportion of educated people. China has only 1.5 million college students, out of a total population of over 1.3 billion. In China, there is enormous undeveloped hinterland with excess rural population, but the likelihood of the absorption of rural workers into the cities without upheaval seems very dubious, he said. "You don't have that problem in India because they have already done an amazing job of absorbing excess rural population into the cities. India's rural population has gone from 90 per cent to 54 per cent without any upheaval," he said. Everybody says China has eight per cent growth and India only 3 per cent, but that is a total misconception. "I think India's progress is far more impressive than China's," he said.

Courtesy: The Economic Times, January 06, 2004

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Hindustan Petroleum Corporation Ltd (HPCL) is set to acquire 100 retail outlets of Sri Lanka's Ceylon Petroleum Corporation for $100 million. HPCL, India's third largest oil company, has offered $23 million more for the pumps that its domestic rival Bharat Petroleum Corporation (BPCL), which put in a bid of $77 million. Indian firms will control 66 per cent of the island nation's oil product sales. Indian Oil Corporation (IOC), which has already taken over 100 retail outlets on the invitation of the Sri Lankan government, currently has a 20 per cent market share. IOC, India's largest oil company, is now setting up an additional 150 franchisee outlets through its subsidiary, Lanka IOC Ltd. Industry sources familiar with the development said the Reliance group and the IOC-owned IBP Ltd both bid $40 million, while the ONGC-controlled Mangalore Refinery and Petrochemicals Ltd bid $45 million for the 100 pumps. Among the international bidders, Petronas and China Petroleum bid $40 million and $45 million, respectively.

Courtesy: The Economic Times, January 06, 2004

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India is back in currency. As the nation stands on the cusp of explosive growth, "the feel good factor" is here to stay. The year 2003 has been a remarkable one on practically all fronts, signalling a tremendous resurgence in the economy. We have had a good monsoon. The faith and confidence of foreign investors in our country's economic prospects have been amply demonstrated with their putting in a record $7 billion during this year. Today, foreign exchange reserves in excess of $100 billion are at an all time high and secures us against any adverse external shock. In turn, this has prompted rating agencies to revise their outlook on India . Quarterly profits of corporations are soaring, helped by low interest rates, increasing demand for their products, and improved productivity. Overseas jobs are moving to India as the outsourcing wave gains momentum. 50% of Fortune 500 Companies have taken this route. Interestingly, 100 of the Fortune 500 Companies have set up R&D centres in India , and GE's R&D Centre here is its second largest with over a 1000 Ph Ds. As India outperformed the global economy in 2003 by a considerable margin, the whole world became alive to our country's potential. Stock markets are booming and currently represent wealth close to 55% of our GDP. Our brain power has reshaped corporate America and continues to march on. One-third of NASA scientists are Indians and there are over 5000 Indo-American professors in American colleges. At Harvard itself, 10% of the faculty comprises Indian intellectuals.

In today's world, globalisation is not an option but an imperative. Earlier, India 's traditional strength in services could not be exported, as services were seen as a non-tradeable sector. Today, the scenario is very different. Our techno takeoff has been and continues to be spectacular. Additionally, with growth in the telecommunications infrastructure, skills even of a radiologist, or a secretary, or a financial analyst, or a computer programmer, have all become exportable. High quality customer services can now be delivered over a telephone link, one end of which could be in Bangalore or in Hyderabad. And this is causing the great exodus of jobs from high cost countries to India. The relative youth of India 's labour force is yet another vantage point. Adding to the domestic cheer, the global economy, especially the US is showing strong signs of recovery. It is remarkable that during 2002-03 India's exports grew at close to 19%, despite at least two handicaps - a weak global demand and stronger rupee. Double digit export growth is continuing this year also. This is welcome - especially if that deficit results in capital flows into infrastructure. India 's aspiration of achieving 8% growth entails an annual investment spending of about 30% of the GDP. Since domestic savings is about 25% of GDP, the extra 5% has to come from foreign sources, which translates roughly into $25 billion of foreign investment. Finally, we can all bet on India 's prosperity. With an expected 7 to 8% GDP growth and inflation under control at 4 to 5%, the scene at the macro level is indeed encouraging. Oil prices seem stable too and there is hardly any likelihood of pressures from other quarters. One hopes that the rain gods will continue to be benevolent and no untoward global incidence occurs, in which case, we can all keep smiling.

Courtesy: The Economic Times, January 06, 2004

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Leading BPO company Daksh eServices has decided to set up an overseas facility at Manila in the Philippines. The company will invest $5 million (Rs 22.8 crore; $1 = Rs 45.62) in the initial phase (12-15 months) to set up the facility, which will be operational in March 2004, Sanjeev Aggarwal, CEO, Daksh eServices, said. Daksh plans to employ 1,000-1,500 people in the next 12 months at the new centre. It currently employs more than 4,000 people across its units in Gurgaon and Mumbai and provide retail, telecom, tech and customer support. Its total headcount will rise to 10,000 by 2005. As the first Indian BPO company to start operations in the Philippines Daksh aims to become one of the largest independent BPO firms in the Apac region, he said. The new facility is a full-service BPO operation, offering customer service, tech support and back-office transaction processing.

Courtesy: The Times of India, January 06, 2004

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State-run Oil and Natural Gas Corp (ONGC) has launched the biggest pipeline project in Asia-Pacific by way of laying two sub-sea pipelines in Mumbai High offshore field at an estimated cost of $600 million. Dubbed the Bombay High-Uran trunk pipeline project, the mammoth pipe upgrades involves laying two 204-km pipelines - one a 30 inch diameter line for oil and the other a 28-inch gas line - to replace the ageing trunk lines at the Mumbai High offshore field in the Arabian Sea, sources said. The work scope also includes about 50-kms of spur lines to the Uran onshore collection terminal near Mumbai. Project design was undertaken by Engineers India Ltd.

Courtesy: The Pioneer, January 05, 2004

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Fresh inflows of $541 million further pushed up India's foreign exchange reserves to a new record high and close to $100.6 billion during the week ended December 26. Foreign exchange reserves rose to $100.590 billion from $100.049 billion for the period under review, according to the Reserve Bank of India's weekly statistical supplement released here today. This rise has been less compared to previous three weeks when the foreign exchange reserves had swelled by more than $1 billion each week. Foreign currency assets increased by $541 million to $96.549 billion, it said.

Courtesy: The Hindu, January 04, 2004

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Ladies and gentlemen please take your seats. You are about to witness one of the greatest shows on earth: the gradual Indian takeover of global companies. As the process unfolds, every worthwhile Indian company will become a multinational corporation (MNC) that not only starts businesses abroad but also swallows up existing foreign multinationals. When India began globalising in 1991, the Indian left howled that this would mean the wholesale takeover of Indian companies by foreign multinational companies (MNCs). Today, it has become a reality. The trend began haltingly a few years ago. In 2000, Tata Tea took over a global company twice its size, Tetley Tea, the second biggest tea company in the world. That is, global financiers provided the funds to enable an Indian minnow to take over a global whale. Next, Essel Packaging , owned by Subhash Chandra, took over Propack of Switzerland to form Essel Propack. The merger created the biggest producer in the world of laminated tubes, and an Indian MNC became global number one.

But these takeovers remained exceptional events till 2003. Only in that year did the pace of Indian takeovers accelerate so much as to constitute a new trend, one that the world must sit up and take notice of. According to one source, more than 40 foreign companies were taken over by Indians last year. Tata Motors is all set to acquire the truck factories of Daewoo in South Korea for a reported $118 million. The Ambanis have bid for, and look very likely to takeover, Flag International , a major international telecom network, for perhaps $211 million. Ranbaxy, our biggest pharmaceutical company, has just acquired RPG Aventis , the French generic wing of the multinational Aventis. Here again, an Indian minnow has acquired part of a global whale. Wockhardt, owned by the Khorakiwalas, acquired CP Pharmaceuticals of UK. The Khorakiwalas had already made a minor foreign acquisition, of Wallis Laboratories, in 1998. Hindalco, the flagship company of the Kumar Birla group, acquired two copper mines in Australia - Mount Gordon and Nifty.

Sterlite, the successful bidder for the privatisation of Bharat Aluminium and Hindustan Zinc, has become a true multinational by acquiring copper mines in Australia. It has also been short-listed as the preferred bidder for buying a 51 per cent stake in Konkola Copper Mines, the biggest government-owned mine in Zambia. Readers might think that only the biggest Indian companies can get into the global takeover game. This is simply not so. Many middle-sized companies, which readers may not even have heard of, are becoming multinationals through foreign acquisitions. Sundaram Fasteners, whose production-line includes humble items like radiator caps, nuts and bolts, has acquired Dana Spicer Europe, the British arm of a global multinational. Separately, Sundaram Fasteners is setting up a plant in China to take on the mighty Chinese. Amtek Auto, another auto ancillary that came up in the 1990s, has just acquired the GWK group in the UK, which is twice its size. Indian auto ancillary companies are sweeping world export markets and in the process acquiring MNC rivals that cannot compete. After 30 years of supplying components to UK-based SPP Pumps, Kirloskar Brothers has now acquired a majority stake in the British company. Truly, this is a case of the empire striking back. The global system is no longer rigged by and for white men. It can be used by Indians no less than Americans to leverage their talent to create global corporate empires. The process has begun.

Courtesy: The Economic Times, January 05, 2004

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India's trade with countries of the South Asian Association for Regional Cooperation (SAARC) has risen by 19 per cent in dollar terms during 2002-3 and 21 per cent in rupee terms, according to an analysis by a leading chamber. The PHD Chamber of Commerce and Industry found that Bangladesh is India's largest trading partner in SAARC accounting for 42 per cent of official exports to the entire region during 2002-3. As far as Pakistan is concerned, bilateral trade rose by 22 per cent during the year but exports from this country have risen more rapidly than imports. Exports have gone up by 45 per cent but imports declined by 30 per cent.

Courtesy: The Hindu, January 04, 2004

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It was Maruti Udyog's IPO that paved the way for a dream run in auto stocks. Macro positives such as a strong GDP growth and availability of cheap finance, coupled with a favourable monsoon, have driven the strong demand for automobiles in the past one year. While the increasing affordability following excise duty cuts and cheaper finance options are aiding a boom in passenger car and motorcycle sales, the recovery in industrial economy and improving road conditions are pushing up demand for trucks. Thanks to a good monsoon and a resultant surge in agri-GDP, tractor industry volumes are rebounding from historic lows. Meanwhile, companies such as Maruti, Mahindra & Mahindra, Hero Honda, Tata Motors and Bajaj Auto continue to focus on cost structures to extract further savings despite increasing pressure from rising steel prices. Another area of growth for the ancillary companies has been exports, which is expected to grow at a compounded annual growth rate (CAGR) of 21.5% to $2.6bn between '03 and '09, as outsourcing from the country is fast catching up. Exports of auto components is now witnessing a structural shift with higher supplies to OEMs (original equipment manufacturers) and Tier-I companies. Exports of joint ventures or subsidiaries of overseas companies are also on the rise. Exports typically account for less than 5% of local auto component companies' revenues, but most firms are aiming to increase this level to 20-40% over the next three to four years. Some of the top gainers in the last nine months are Bharat Forge, Mico, Sundaram Fasteners, Sundaram Clayton and Ucal.

Courtesy: The Economic Times, January 05, 2004

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Buoyed by a conducive investment environment, net inflows of foreign institutional investors in the Indian equity and debt markets recorded an almost tenfold rise in 2003 at Rs 35,153.8 crore (US $7.59 billion) as against Rs 3,677.7 crore ($763.5 million) registered in the previous year. In the period under review, the number of registered FIIs also grew from 489 to 517 as on December 31, 2003. On a cumulative basis, the grand total of net inflows into the Indian markets grew to Rs 94,103.1 crore ($22.89 billion) as on December 31, 2003 from Rs 58,949.3 crore ($15.3 billion) a year ago.

Courtesy: Hindustan Times, January 05, 2004

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It seems that finally the fabled 'Indian middle class consumer' has arrived. If the consumption pattern of 2003 is an indication, this is going to be the gang-buster year for consumers. Be it the silent march of Korean televisions, refrigerators and air-conditioners into the middle income group homes, or the 'Dhirubhai dream' enabling the next door raddiwala to don a mobile phone - the deals to delight the consumer will only get more aggressive this year. Today the Indian consumer is paying the lowest telecom tariff anywhere in the world thanks to the price war between the incumbent and the private telecom companies. Of course, the rollout of CDMA technology by operators like Reliance and Tatas has totally changed the telecom landscape. The cut-throat competition in the white goods industry pushed the price points southwards. During the year, the average price drop for televisions was 10%. Washing machines witnessed 8 to 10% price drop while refrigerators and ACs took a 5-7% and 18 % fall in prices respectively.

"Home loan rate has gone down by more than 3.5% in the last twelve months. The industry has grown by a whopping 35 per cent per annum from a base of Rs 25,000 crore in 2002 to Rs 40,000 crore in 2003," says Rajiv Sabbarwal, CEO ICICI Home Finance. In the information technology sector, the latent potential of the Indian home and individual consumers has forced hardware majors to roll out the sub-Rs 50,000 notebooks. Says Hewlett-Packard India Vice-President (PSG) Ravi Swaminathan: "The industry has finally realised that the pricing of the notebooks so far has proved to be a great inhibitor for consumers. In order to push the penetration levels, we had to get to the sweet spot of Rs 50,000." In fact, one of the verticals that caught the Indian consumers' fancy this past year was automobile. The year saw a record sales of 6.45 lakh cars across India, that is an 18 per cent growth over the previous year's figure of 5.45 lakh.

**Indian consumer is today paying lowest telecom tariff
**Total number of mobile users in India has also doubled
**Cut-throat competition in the white goods industry pushes prices southward
**Home loan rates have gone down by more than 3.5% in the past 12 months

Courtesy: Hindustan Times, January 05, 2004

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When the 1991 economic reforms were announced, India was the ugly duckling of the world's economies, with forex reserves less than $1 billion and economic growth close to stagnant. But 13 years later, it is truly India's day in the sun, a time for the swan to behold its own reflection. India is now among the top contributors to world Gross Domestic Product (GDP), with a share of 5%, after USA (22%), China (13%) and Japan (7%). India's national income is growing at the second highest rate in the world of 6% plus (after China's 8%), it may not be long before it outstrips at least Japan in share. India's at the top of the heap as far as growth in per capita income is concerned too. For the period 1997-02, India's national income grew at 19%, second only to China, which grew at 39%. But its growth is double that of the US. Moreover, in terms of acceleration of growth rates, India is second to none. India is the only country in the world that has shown rising growth rates over the 1992-2002 decade. During the current decade 1992-2002, India's per capita income grew by 46% from the 36.5% growth rate observed during the decade 1982-1992. On the other hand, China has shown a decline in growth rate over the decades by as much as 7%. The fast growing East Asian countries like Thailand and Hong Kong have seen a fall in growth rates by as high as 62% and 51% respectively. India's services sector, a 51% contributor to India's GDP, has the fastest growth across 130 countries. With an average growth of 7.9% during the 1990-2001 period, India is all set to beat China, which has a growth of 8.9%, and the highest in the world. This is because India's services' growth is accelerating, while China faces a dwindling growth rate. At any rate, again, India's growth is double US' or UK's and comfortably ahead of the South East Asian countries as well. With increasing visibility in the global economy, investor faith in the Indian economy is on the rise. In December 2003, India's foreign exchange reserves crossed the $100 billion mark. With strong economic fundamentals behind it, India is poised for a take off. And just maybe, its probably not too daring to think that India could in fact be the world leader in the times to come.

Courtesy: The Economic Times, January 01, 2004

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The initial public offering (IPO) from ONGC is going to be a landmark for more reasons than one. It is going to be the largest ever pure equity mop-up by an Indian company, either in the domestic or the international market, and might well turn out to be one of the biggest in the world in '04. The size of the IPO, which will be a huge $2 bn at current market rates, is big even on a global scale. The world's largest IPO in '03 was that of China Life, which raised $3.4 bn. But this was a global issue that raised money from the New York and Hong Kong markets. In contrast, ONGC's going to be a domestic offering. Kotak Mahindra Capital has been appointed the lead book runner, while DSP Merrill Lynch and JM Morgan Stanley will be the co-book runners for the proposed public offering of 10% shares of ONGC. For Gail, ICICI Securities and HSBC Securities and Capital Markets will handle the IPO. The offerings are expected to open for subscription before the end of the current fiscal. Some of the biggest issues of the past by Indian companies would turn minnows in comparison to the ONGC offering. The previous record for the largest issue by an Indian company is held by Reliance Petroleum, which raised Rs 5,500 crore in 1992.

Courtesy: The Economic Times, January 01, 2004

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Indian Oil has finalised a $75 million deal with Sri Lanka 's Ceylon Petroleum to sell fuel on the island, Sri Lanka 's privatisation agency said on Wednesday. Chandu Epitawala, a director at the Public Enterprises Reform Commission, said IOC had advanced $30 million for the deal, which includes a license to retail fuel at 100 petrol stations, as well as a share of Ceypetco's storage and pipeline facilities. He said plans were also on track to select a final bidder to become the third player in the retail fuel market by mid-January, as part of efforts to liberalise the petroleum sector. With the IOC deal, the government will have made about $157 million from privatisation since the start of 2003.

Courtesy: The Economic Times, January 01, 2004

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India Inc is all set to take on the world. The year '03 saw a sudden spate of overseas acquisitions by Indian companies, newly confident of their engineering and technological skills. This marks a total reversal of the situation some years ago, when there was a widespead fear that Indian companies would be acquired by cash-rich multinationals. Among the large acquisitions abroad, there was Reliance Industries' proposed $211-m acquisition of FLAG Telecom. The AV Birla group acquired copper mines in Australia and a Carbon Black unit in China. Sterlite too took over a copper mine in Australia. ONGC spent over $1bn to pick up a stake in oil fields in Russia and is negotiating with Shell for a stake in an oil field in Angola. Tata Motors, the largest truck maker in the country, acquired a truck plant in South Korea from auto major Daewoo Motors in '03. Auto component companies like Bharat Forge, Amtek Auto also made overseas acquisitions during the year. Infosys, Wipro and i-flex acquired small software companies abroad. According to estimates by analysts, corporate India was sitting on a free cash-flow of Rs 23,000 crore as of March, '03. This is likely to increase to around Rs 30,000 crore by March '04. Compare this with a measly Rs 7,500 crore five years back. Analysts say this has been achieved by adopting discipline with regard to capital expenditure, cost-cutting and better working capital management.

They estimate that companies have brought down the debt level, represented by the net gearing, from 45% in the mid-1990s to 15% now. "Thus, we believe companies are well placed to invest in new assets to drive growth," says the latest note by brokerage Salomon Smith Barney. Analysts expect cross-border mergers and acquisitions to intensify in areas like pharmaceuticals and software. At the same time, manufacturing sectors like automobiles, engineering, cement, paints and petrochemicals may continue to remain active. Some of the capacity expansion plans announced by large corporates are spread over the next few years, and overseas acquisitions may figure as part of these plans. Anand Mahindra, vice chairman and MD of Mahindra & Mahindra and president of the Confederation of Indian Industry, believes that companies like Bharat Forge and Moser Baer have clearly demonstrated the global competence of India's manufacturing sector. The Tata group has made globalisation its theme for '04. According to sources in the group, every major industry house is looking abroad and the New Year may see more cross-border activity than in '03. Reliance Industries has already announced a plan to spend over Rs 5,000 crore annually in various businesses, from petrochemical, oil exploration to telecom. It is set to complete the $211-m acquisition of FLAG Telecom.

Tata Steel has announced a Rs 2,500-crore plan to expand its capacity to five million tonnes from the existing four million tonnes. National Aluminium announced a Rs 4,000-crore-plus capacity expansion plan for alumina refinery and smelter. Besides this, the Jindal Group is talking about spending over Rs 5,000 crore in steel and other businesses. India Oil, the only Fortune 500 company in the country, is set to spend close to Rs 10,000 crore for increasing its refinery and petrochemical capacity. ONGC is set to invest another Rs 11,000 crore annually in oil exploration and production. Infosys Technologies is sitting on close to Rs 2,500 crore of cash. According to brokerage CLSA Emerging Markets, this is 60% of its balance sheet. It recently acquired a company in Australia for $23m in an all-cash deal, and there is a possibility that it may announce more such deals in '04. Analysts do not expect Wipro Technologies, with a Rs 2,000-crore war chest, to stay quiet either. Bajaj Auto, with a cash and investment portfolio of Rs 2,200 crore, is also expected to make announcements that please its investors. With the amount of cash corporates have generated over the past few years through financial restructuring, more capacity expansions and acquisitions are expected in '04. A head of research at a leading foreign brokerage points out that government restrictions on overseas acquisitions have been eased. At the same time, foreign exchange is no longer a constraint. "The corporate sector is confident of venturing in new places around the world. They went through a phase when they were concerned about the fierce competition being brought up in a protected environment," the head of research said.

Courtesy: The Economic Times, January 01, 2004

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New Delhi: India could not have asked for better on the last day of 2003 with economic growth shooting up to record 8.4 per cent during the second quarter of 2003-04 after years of sluggish growth, thanks to bumper agriculture production coupled with impressive performance by industry.

Not to be left behind, services sector led by trade, hotels, transport and communication chipped in significantly with over 7.0 per cent growth to push up GDP, data for which was released by government here today.

The combined effect of the three important components -- agriculture with 4.1 per cent, manufacturing 6.8 per cent and service, led to an overall 7.0 per cent growth in GDP during April-September 2003-04, amid predictions of further improvement in the economy.

It is for the first time in almost a decade that economy grew by over 8.0 per cent to break the psychological barrier to give confidence of attaining the 10th Plan target of eight per cent annualised growth.

The high growth comes amid booming stock markets and burgeoning foreign exchange reserves, which have crossed 100 billion dollar mark, and high inflow of foreign capital both direct and portfolio investments.

Comparatively, the economy had posted 5.2 per cent growth during April-September last year, giving rise to speculation that the 10th Plan target would again prove evasive.

The "feel good" factor was cited as one of the major reasons