Presentation is loading. Please wait.

Presentation is loading. Please wait.

31/05/2014 1 Invest India Policies & Opportunities Rajeeva Ratna Shah Secretary Department of Industrial Policy and Promotion Ministry of Commerce & Industry.

Similar presentations

Presentation on theme: "31/05/2014 1 Invest India Policies & Opportunities Rajeeva Ratna Shah Secretary Department of Industrial Policy and Promotion Ministry of Commerce & Industry."— Presentation transcript:

1 31/05/ Invest India Policies & Opportunities Rajeeva Ratna Shah Secretary Department of Industrial Policy and Promotion Ministry of Commerce & Industry Government of India November 3, 2003, Paris

2 2 India – Land of Opportunities Second Largest Emerging Market Largest democracy – political stability & consensus on reforms Liberal & transparent investment policies Highest returns on investment; India 19.33%, China 14.25%, Thailand 13.3% Fourth largest Economy (PPP) - A safe place to do business Largest reservoir of skilled/semi- skilled manpower Long-term sustainable Competitive advantage - High growth rate economy

3 31/05/ Strong Macro-Economic Performance Sustained Economic growth; 7% - Current Year 8% - Next quinqennium / decade Over 6% - Next 50 Years – Goldman Sachs Exports growth - over 19 % in ; Non Oil imports growing at 31%-Economic vibrancy Positive balance of trade with USA and China FII Investment – over US$ 5 billion so far this year Developed Banking system moving rapidly towards ICT integrated core banking/net banking Mature Capital Market – NSE third largest, BSE fifth largest in terms of number of trades

4 31/05/ Sustained Economic Growth (Base year: )

5 31/05/ Growing Foreign Exchange Reserves Foreign Exchange Reserves (US$ billion) Exchange Rate (Rs/US$)

6 31/05/ Availability of Skilled Labour 1=Low 10= High India 8.4Brazil 7.5 USA 7.4 Mexico 6.6 Czrch 6.3 China 4.2 Availability of Qualified Engineers 1=Low 10= High Select Indicators

7 31/05/ Economic Liberalization Fiscal Policy Reforms : Stable tax regime with just 3 rates for both Excise as well as Customs duties Full National treatment for foreign Cos. incorporated in India Industrial Policy Reforms : Capacity licensing dispensed with Compulsory licensing only in 6 sectors: restrictions on grounds of national security, public health, public safety FDI policy being progressively liberalized Trade policy Reforms : Most items on Open General License, Quantitative Restrictions lifted; Monetary Policy and Financial Sector Reforms : Interest rates brought down – Bank rate/Prime lending rate lowered Banking Sector reforms – prudential norms stiffened Securatization Act for better security for creditors Competition law enacted. Competition Commission constituted Independent regulators in place for Insurance sector (IRA) and Capital Markets (SEBI) Exchange Controls relaxed; Profits and dividends can be freely repatriated;

8 31/05/ Infrastructure Development US$ 12 billion Highways Development Programme; Over 13,000 Kms of Highways being developed. US$ 22 billion Sagar Mala programme to develop ports and shipping sector Modernization of Airports at New Delhi & Mumbai. World s Fastest growing telecom market with a unified licensing regime and world class international and domestic connectivity; The Electricity Act, 2003 enables captive generation and trading in electricity;

9 31/05/ Brand India R&D base for 100 of Fortune 500 companies; GEs largest R&D Center outside US; Large pool of World class scientific and technical manpower; Indian Institutes of Technology; Indian Institutes of Management. S&T policy aims at R&D investments of 2% of GDP by 2007 Among the only three Asian countries with super computing competence Strong base for manufacturing; Bharat Forge worlds largest forging facility Most major MNCs like Volvo,GM,GE, Chrysler, Ford,Toyota, Unilever, Cliariant, Cummins, Delphi sourcing high quality components and hardware from India Essel Propack worlds largest manufacturer of laminated tubes(30% of global market/70% Indian,Chinese market). Hyundai Motors India – Global base for manufacturing small cars; Indica(100% indigenous car) being exported to Europe as Rover City. India exporting steel worth more than US$1 billion to China Hero Honda worlds largest manufacturer of motorbikes Precision Automation & Robotics India (PARI) - 20 Fortune 500 clients

10 31/05/ Competitive Entrepreneurship Prevalence of foreign technology licensing – Rank 1 Availability of scientist and engineers – Rank 2 Quality of management schools – Rank 9 Firm level innovation – Rank 12 Firm level technology absorption – Rank 16 Company spending on R&D - Rank 32 (Source Global Competitiveness Report, UNCTAD 2003) India amongst the leading entrepreneurial hotbeds globally (Red Herring Clubs India with Israel)

11 31/05/ The Emerging Market: India Traditional & Emerging Focus Some MNCs? Local Firms Future Opportunity? 5-10 million, Rich PPP>$10,000, m PPP $ 3-10,000, 150m PPP $ 2-3,000, 150m PPP>$ 2000, 500m Traditional MNC Business Model © C.K. Prahalad

12 31/05/ India a Preferred VC Destination in Asia-2001 CountryAmt. Invested ($min)No. of Companies Australia$ 1, South Korea$ 1, India$ China$ Hong Kong$ Taiwan$ Singapore$ Malaysia$ Thailand$ New Zealand$ Indonesia$ Philippines$ 4.83 Sri Lanka$ 0.01 Source : AVCJ

13 31/05/ Investing in India – Entry Routes Automatic RoutePrior Permission Investing in India General rule No prior permission required Inform Reserve Bank within 30 days of inflow/issue of share By exception Prior Government Approval needed. Decision generally Within 4-6 weeks

14 31/05/ Manufacturing Sectors with 100% FDI under Automatic Route Cars and motor vehicles Refrigerator and fire fighting equipments Food processing Electronic Hardware Iron and steel Private Oil Refineries Agriculture tools and implements Fertilizers and pesticides Pollution control equipments Tyres and tubes Packaging products Construction Machinery Domestic air conditioners Electric motors, industrial electric furnaces Mining and Querying Machinery Steam engines and turbines Non-metallic mineral products Rice, oil mill machinery Chemical machinery Drugs and pharmaceuticals except those requiring industrial licensing Medical equipments Office computing and accounting machinery

15 31/05/ Infrastructure Sectors with 100% FDI Under Automatic Route Electricity Generation (except Atomic energy) Electricity Transmission Electricity Distribution Mass Rapid Transport System Roads and Highways Toll Roads Vehicular Bridges Ports and Harbors Hotel and tourism

16 31/05/ Services Sector with 100% FDI under Automatic Route Advertising and films Computer related services Research and development services Construction and related engineering services Pollution control and Management services Urban Planning and Landscape services Architectural services Health related and social services Travel related services Road transport services Maritime transport services Internal waterways transport services

17 31/05/ Sectors with Restrictions on FDI Sectors with limits on FDI Caps Private Banking ( 49%) Insurance (26%) Domestic Airlines (40%) Basic and mobile services (49%) Print Media (26%) Defence production (26%) Sectors where FDI is prohibited Gambling, betting, lottery Retail Trade Agriculture Plantation, except tea plantation

18 31/05/ Country wise FDI inflows (Since July 1991) France ranks 7 th

19 31/05/ Investment from France- Sectors (Since July 1991)

20 31/05/ Some of the French Companies in India Lafarge Ciments Francis Saint Gobain Compagnie International LOreal France Peugeot Alcatel Spacecom Vetrotex International GAZ de France Schinder Electric Air Liquide International Groupe Danone GDF International Radio Telephone Total SA France Telecom Vantico International Essilor International ELF Gas Alstom

21 31/05/ Intellectual Property Rights-Initiatives Modernization/revamping of legislations on Intellectual Property IP; IPR Laws are TRIPS compliant; Intellectual Property Appellate Tribunal functional from 15 th September 2003; Major initiative underway at modernizing IP administration; Computerization of IP administration; Digital database library of patent, trademark & design records; For more information visit

22 31/05/ Investment Facilitation Foreign Investment Implementation Authority (FIIA) - to sort out any operational difficulty and facilitate implementation; Last meeting with French investors on FDI In India- Policies and Procedures Also available in Spanish, German, French & Italian. An Empowered Sub-Committee of the National Development Council set up on Creating an investor-friendly climate; To focus on removing regulatory barriers to investments. Web site On-line chat, bulletin board and ;

23 31/05/ India: FDI Outlook Rated as the best BPO destination; AT KEARNEY Best technology licensing regime - UNCTADs Global Competitiveness Report, 2003; Rated among the most favourite investment destinations (UNCTAD, JETRO, JBIC, Deutsche Bank, EIU, etc.) Major destination for foreign venture capital funds (Far Eastern Economic Review) Sixth most attractive investment destination – ATKEARNEY Business Confidence Index, 2003 Also among the top 10 Tourist Destinations.

24 31/05/ Investment Requirement in Energy & infrastructure up to 2012 LNG Terminals $ 10 bn Refineries $ 22 bn Coal $ 26 bn Transmission & Distribution $ 116 bn Oil & Gas $ 100 bn Cross-Country Pipelines $ 10 bn Opportunities and Potential Areas of Cooperation Railways US $ 15 Billion Ports US $ 20 Billion Power Generation $ 143 bn Roads $ 40 bn

25 31/05/ Investment Opportunities Roads: Capacity enhancement of highways; 7000 kms of National Highways being offered during the current year; Many more opportunities in the States; Opportunities for equipment manufacturers; technical support; Urban Infrastructure: Development of townships for the rapidly growing, increasingly affluent urban middle class; City level infrastructure; roads, bridges, IT Parks, sanitation and water supply etc. Consultancy in urban planning;

26 31/05/ Investment Opportunities Ports: Government of Indias initiative of developing ports – Sagar Mala with an investment of US$ 22 billion; Development of Ports; Shipping; Power: Addition of 100,000 MW required over the next 10 years; Installed capacity 106,000 MW; Hydro-electric initiative to develop 50,000 MW; Detailed project reports being prepared to facilitate private investment.

27 31/05/ Investment Opportunities Telecommunications Cellular phones 1.5 million every month; To increase by 20 million this year; by 100 million in the next 3- 4 years; Telephone connections to rise to 75 million by 2005 and 175 million by 2010; Investment Opportunities: Setting up manufacturing base. Value added services; Food Processing Large production of variety of food products; Investment of US$ 28 billion required to raise food processing levels by 8-10 %. Indians spend about 50% of household expenditure on food items. Demand for processed food rising with growing urbanisation and income levels.

28 31/05/ Skilled knowledge workforce Indias competitive edge is its manpower Over 380 universities (11200 colleges) 1500 research institutions Over 200,000 engineering graduates Over 300,000 post graduates from non-engineering colleges 2,100,000 other graduates Around 9,000 PhDs Knowledge workers in software and service industry increased from 6,800 in to 650,000 in 2003

29 31/05/ ICT opportunities Indias inherent strengths IT Industry US $ 14 billion; growing at 50% p.a. Exports US $ 10 billion 2008 exports target : US $ 60 billion, to be 35% of Indias total exports; Job creation: a million direct & 2-3 Million indirect; High quality standards; 62 SEI/CMM level 5 companies, two third of worlds total. 250 Fortune 500 companies clients of Indian firms; Opportunities : JV/FDI Multi purpose smart cards with PKI protection Health informatics and telemedicine network Setting up a deep submicron fab facility Collaborative ICT research in language technologies / next generation communication / Internet technologies Joint Software development in super computing applications in fluid dynamics, structural mechanics, bioinformatics, nanoinformatics, etc

30 31/05/ India - The Backoffice hub India has become the most preferred destination – Outsourcing trend increasing GE,TI, Intel, CISCO, Microsoft, Dell, Sun Micro, Oracle, LG, Ford, American Express and other financial sector companies; Customer needs are being met Large pool of skilled English speaking workforce – skills and scalability, 24x7 support Productivity and quality enhancement Conducive policy environment and Government support Highly improved telecom infrastructure Call center career is aspirational unlike a low choice in the West

31 31/05/ Impact* Insurance Retail financial services / Retail banking Pharmaceuticals Telecom Airlines Automotive ** Key opportunity areas Claims processing Servicing Call centre operations Loan processing (consumer, corporate, mortgage) Research and development Call centre operations Billing Engineering and design Accounts payable/ receivable Revenue accounting Call centre operations Frequent flyer programmes Overall cost savingPer cent % cost saving for processes offshored Cost savings by off shoring BPO services to India

32 31/05/ Country Advantage Likely to be Comoditized Task aggregation And process level improvement Country advantage (45-55% savings) Vendor advantage (30-40% savings) Original Cost base Factor Cost Savings Additional Telecom & manage- ment costs Off-shore Location cost Consoli- ation, Standar- Dization & superior skills Task Reengi neering Econo- mies of scale Process Reengine -ering New cost base Task migration Task level improvement Does not Include gains from Over-delivery and continuous improvement

33 31/05/ Joint Venturing opportunities in Biotech Indias inherent strengths Rich Biodiversity Large reservoirs of valuable diagnostic and clinical data Vibrant and inventive pharmaceutical industry World class network of educational and research institutions Known strengths in mathematics, logic and computational skills Super Computing and Software strengths enable extensive use of bio-informatics in new drug discovery Opportunities : Joint Ventures in Biotech based new drugs / pharmaceuticals

34 31/05/ Global Business Leaders - Bullish On Indias Potential India is a developed country as far as intellectual capital is concerned India can be a major part of Dells operations and we are looking to capitalize on Indias human capital We are expanding our presence in India to take advantage of the ample R&D talent available India is handling the most sophisticated projects in the world..I am impressed with the quality of work JACK WELCH, GE JOHN CHAMBERS, CISCO MICHAEL DELL, DELL BILL GATES, MICROSOFT

35 31/05/ Thank You Visit us at at

36 31/05/

Download ppt "31/05/2014 1 Invest India Policies & Opportunities Rajeeva Ratna Shah Secretary Department of Industrial Policy and Promotion Ministry of Commerce & Industry."

Similar presentations

Ads by Google