Archive for ‘India alert’

08/06/2016

Amazon Plans $3 Billion Investment in India – India Real Time – WSJ

Amazon.com Inc. plans to invest an additional $3 billion into India, which is emerging as a critical area of growth for the e-commerce giant.

Chief Executive Jeff Bezos announced the plan at a meeting of business leaders Tuesday with the Indian Prime Minister Narendra Modi in Washington. Amazon sees “huge potential in the Indian economy,” Mr. Bezos said in a statement.

The announcement brings Amazon’s total planned investment in India to $5 billion, since it announced a $2 billion infusion in 2014. An Amazon spokesman declined to provide details such as how the new funds would be allocated or over what period.

Amazon operates a pure marketplace in India, due to local rules, selling only goods offered through its website by third parties. It nonetheless has warehouse and delivery technologies there that are particularly attuned to the local market, where internet connectivity can be spotty or nonexistent and many consumers don’t have credit cards.

Source: Amazon Plans $3 Billion Investment in India – India Real Time – WSJ

08/06/2016

U.S. Firm to Build Six Nuclear Reactors in India – India Real Time – WSJ

The U.S. and India agreed to move ahead with the construction of six nuclear reactors in India by an American company, the first such move since the countries signed a landmark civil nuclear deal in 2008.

The breakthrough capped a wide-ranging White House meeting on Tuesday between President Barack Obama and Indian Prime Minister Narendra Modi, who are seeking closer cooperation as Washington wants to boost New Delhi’s role in counterbalancing China.

The meeting, which included lunch at the White House, will be followed on Wednesday by a speech by Mr. Modi to Congress, wrapping up the Indian leader’s fourth visit to the U.S. as part of an increasingly close relationship that has been sought by both governments.

The warming Indian relationship is backed by the lure of accelerating growth in that country, signs of improvement in the business climate, shared democratic values and some overlapping strategic goals.

By contrast, recent U.S. interactions with China, a far bigger Asian economy and U.S. trading partner whose growth appears to be slowing down, have been marked by strains and warnings over economic and security issues.

Source: U.S. Firm to Build Six Nuclear Reactors in India – India Real Time – WSJ

07/06/2016

Indian solar power | The Economist

NARENDRA MODI, India’s prime minister, visits America for three days this week for talks with Barack Obama. Climate commitments may be one of many topics discussed. Six months ago 187 countries agreed to cut pollution through pledges for the UN climate talks in Paris. The deal adopted there was stronger than many expected, but much remains to be done. Even if countries manage to do all they offered, global warming will likely be held to around 3.5°C above pre-industrial temperatures. Conversely, the Paris deal aims overall to ensure warming does not exceed 2°C.

Unlike America and China, the world’s two largest polluters, India did not pledge a future reduction in aggregate emissions. It offered instead to reduce the intensity of its emissions—the amount of pollution per unit of economic output—by around a third by 2030 as measured against 2005 levels. Its greenest promise was to install 175GW of renewable power by 2022 (most of it solar). This is an enormous undertaking. In 2014, for example, the world’s entire installed solar capacity was 181GW.

The Modi government says the plans are “ambitious but achievable”. The country’s total installed solar power capacity now comes to 5.8GW; to meet its targets it will need to speed up from adding around 4GW a year to adding more than 15GW instead.

Mr Modi believes solar power is the “ultimate solution to India’s energy problem”. Of 250m households in India, 56m do not have access to electricity. The majority are in rural areas where off-grid solar installations, suitable for single homes or small clusters of buildings, could prove particularly helpful.

India’s solar programme is a good way to assess how seriously countries are taking the Paris agreement—particularly given India’s huge population and increasing economic heft. Mr Modi’s moves will illuminate the state of climate diplomacy.

Source: Daily chart: Indian solar power | The Economist

07/06/2016

Here’s How Indians Are Rating Narendra Modi’s Programs – India Real Time – WSJ

Two years into his five-year term, Indian Prime Minister Narendra Modi is asking his countrymen to rate a series of initiatives undertaken by his government.

Among the top scorers so far: an effort expand and modernize the railways and a program to build more roads. Toward the bottom of the favorability rankings: Mr. Modi’s Clean India campaign, which, among other things, aims to get people to use toilets instead of defecating outside.

Mr. Modi has become known for introducing a series of high-profile initiatives, from Make in India, which seeks to promote manufacturing, to pledges to build scores of so-called smart cities across the country.Of 21,770 respondents who had participated in the online survey on the government’s mygov.in website as of Tuesday morning, 70% gave a five-star rating to the government’s efforts to upgrade the rail system. People are asked to grade programs on a scale of one to five.

In the latest federal budget, the government earmarked $17 billion to improve the state-run railroad. Wi-Fi services are being rolled out at stations. And late last year, a deal was struck with Japan to help build India’s first high-speed rail line between Mumbai and Ahmedabad.

The government’s efforts to build more highways and improve the condition of roadways have also been popular with the people. More than 65% of the respondents to the survey gave these initiatives a five-star rating. The target this year is to build 9,300 miles of highways.People taking the survey also seemed satisfied by the government’s attempts to make electricity more accessible.

One of the worst performing programs, according to the current results of the survey, which is ongoing, is Swachh Bharat Abhiyaan, or the Clean India Mission. Only 33% of the respondents gave it a five-star rating. About 16% gave it score of one or two.

India’s Competitiveness and Prosperity Rankings Rise Under ModiIn October, a year into the program, another national survey also hinted at the public’s disappointment with its impact. More the 70% of those polled in that survey said the availability of public toilets hadn’t improved and their cities hadn’t become cleaner.

Mr. Modi is no stranger to crowdsourcing. He regularly encourages Indians to submit their thoughts for his weekly radio show. Prior to delivering his speech on India’s Independence Day last year, he asked citizens to submit their suggestions on what they’d like to hear him speak about. And they did, in hordes.

Source: Here’s How Indians Are Rating Narendra Modi’s Programs – India Real Time – WSJ

07/06/2016

Is India the Most Attractive Place for Retailers? – India Real Time – WSJ

India has leapt into second place in a ranking of the most-attractive developing economies for retailers compiled by Chicago-based consulting company A.T. Kearney.

The company assessed 30 countries based on economic growth, urban population and ease of doing business, among other factors. China topped the list for the second consecutive year, followed by India, Malaysia, Kazakhstan and Indonesia.

A.T. Kearney said India’s high growth rate, vast pool of consumers and new rules for foreign investors lifted the country up 13 spots in this year’s Global Retail Development Index.“Retail demand is increasingly driven by urbanization, an expanding middle class, and more women entering the workforce,” the A.T. Kearney report said. But it noted that not everything was rosy, saying India remains a “challenging and complex market” with infrastructure bottlenecks.

Some retailers and analysts said they were surprised at India’s sharp move up in the A.T. Kearney ranking.

A rule that requires foreign retailers to source at least 30% of their merchandise locally, for example, has led companies to rethink their big plans for India.

Wal-Mart Stores has shelved plans to open supermarkets in India saying the requirement is near-impossible to meet. French hypermarket chain Carrefour has also shut shop.

Swedish retailer IKEA is struggling to source domestically, as The Wall Street Journal detailed in this front-page story. And government officials said recently they don’t plan to exempt Apple from local-sourcing requirements.

Meanwhile, consultants and retailers are growing increasingly skeptical about the size of India’s middle class. Most of India’s population still lives under $2 a day; only a fraction of its 1.2 billion people can afford a Zara dress or a Starbucks Frappuccino.

A change in A.T. Kearney’s methodology could have boosted India’s fortunes. The company said it tweaked the metrics it used to calculate this year’s index, which “had a substantial impact on the rankings.

”For example, it evaluated countries with a population of over 5 million this year, compared with 3 million last year. As a result, some countries that were ranked highly last year – such as Uruguay in 2nd place, Qatar in 4th place, and Mongolia in 5th  place, weren’t analyzed this year.

Source: Report: Is India the Most Attractive Place for Retailers? – India Real Time – WSJ

06/06/2016

Indian Firms Continue to Flounder in the Face of Fantastic Fundamentals – India Real Time – WSJ

India has the highest gross domestic product growth of any large economy; its chronic inflation problem seems under control and it has a relatively business-friendly prime minister. But its companies’ profits remain utterly unimpressive.

The latest round of quarterly results showed once again that whatever is happening with top-line GDP expansion isn’t trickling down to the bottom line.

The profit after tax at the 30 companies that make up the benchmark Sensex rose only 2.7% from a year earlier. That is better than the 9% decline a year ago but a slowdown compared  to the previous quarter.

For the full fiscal year ended March, Sensex company profit fell 1.6%–their worst performance in seven years. Official data showed last week that the economy grew 7.6% in the same period.

Profits were pummeled as Indian government-owned banks reported losses as they set aside huge amounts of money for bad loans.

Source: Indian Firms Continue to Flounder in the Face of Fantastic Fundamentals – India Real Time – WSJ

04/06/2016

Dam completion signifies growing Indian influence in Afghanistan | Reuters

Prime Minister Narendra Modi visited Afghanistan on Saturday to mark the completion of a nearly $300 million hydroelectric dam project, the latest symbol of Indian investment in its South Asian neighbour.

The dam, originally built in western Herat province in 1976 before being damaged during the civil wars of the 1990s, was rebuilt by some 1,500 Indian and Afghan engineers, according to the Indian Ministry of External Affairs.

“It is symbol of our friendship and would usher in hope, light up homes, nourish the fertile fields of Heart and bring prosperity to the people of the region,” Modi said in a social media post as he departed for Afghanistan, the first stop on a five-country trip.

Afghan President Ashraf Ghani has nurtured closer ties with India in the past year as relations with Pakistan have deteriorated in the face of continued insurgent attacks and border tensions.

Afghanistan has walked a fine line as it accepts Indian aid, with Pakistan historically wary of any Indian influence in Afghanistan.

Salma Dam is another big step in deepening and broadening the relationship between Afghanistan and India,” Ghani said in a post on Twitter.

At more than 100 metres (330 feet) high and 540 metres (1,770 feet) wide, the dam is designed to generate 42 megawatts of power and help irrigate 75,000 hectares of land, according to Modi.

India has poured more than $1 billion into Afghanistan reconstruction projects and humanitarian aid, making it one of the largest donors to the war-torn country.

A new national assembly building in Kabul and major power line and road construction have been among the main projects funded by India.

Source: Dam completion signifies growing Indian influence in Afghanistan | Reuters

04/06/2016

This Spanish Company Says It Holds the Key to Speed on India’s Crooked Railways – India Real Time – WSJ

India’s trains are notoriously slow and outdated, but a Spanish train maker says it can change that with coaches that can squeeze much more speed out of the country’s crooked railways.

Talgo S.A. has been wooing India for years as the South Asian nation has one of the largest railway networks in the world and big plans to upgrade its rail infrastructure.

The Madrid-based company got its breakthrough this year when it got the go-ahead to test its coaches on few routes in India to prove its trains can slash travel times for the 13 million people who use the state-owned Indian Railways every day. Talgo claims its coaches can cut travel time by up to 30%.

The existing average maximum speed of Indian passenger trains is 110 kilometers per hour, according to Vijay Kumar, executive director for infrastructure and mechanical engineering at Indian Railways.

One of Indian Railways’ current fastest trains–the Rajdhani Express–travels between Delhi and Mumbai in around 16 hours. Talgo says the same journey with its coaches will take less than 11 hours.

India has traditionally built its own trains and Talgo is the first foreign train-manufacturer to be given permission to conduct trials, said Mr. Kumar.

The tests of the trains began last weekend between Bareilly and Moradabad in northern Indian state of Uttar Pradesh and will be expanded to two other routes.

The main selling point of the Talgo coaches is that India won’t need to change the tracks for them.

“For any conventional train you need a lot of investment in the existing infrastructure but with Talgo train you don’t need any investment in the infrastructure and it can start going at higher speed,” said Subrat Nath, director for India and Asia-Pacific region at Talgo.

Despite India’s dependence on its railways, the system has become outdated and overburdened.

“India is unique and alone among the major countries of the world in not having a single high-speed rail corridor,” said a document presented to the Indian Parliament in 2009 titled “Indian Railways Vision 2020.”

The Congress party-led government back then said it would upgrade the current tracks and build “state-of-the-art high-speed corridors” for the trains to run up to 350 kilometers, or 217 miles, per hour.

In the latest step in that direction, India launched its first “semi-high speed” train in April–the Gatimaan Express– between Delhi and Agra, home of the Taj Mahal. The train has a maximum speed of 160 kilometers, or 99 miles, per hour, cutting the fastest travel time between the capital and Agra by more than 15 minutes.

One of the biggest factors slowing down Indian Railways’ 7,000 passenger trains is the country’s long and winding railroads. There are 495 speed-killing curves in the tracks between Delhi and Mumbai alone, said Mr. Kumar at Indian Railways.

Straightening out existing tracks or building straight ones from scratch is too expensive, said Mr. Kumar, so the trains from Talgo and others which offer more speed on curvy lines could be the best option.

Talgo coaches use a “natural tilting mechanism” which allows them to go up to 20% faster on curves than conventional coaches, Mr. Kumar said.

He said the trials will test whether the trains perform as promised. India has not committed to ordering from Talgo yet.

Talgo’s Mr. Nath says the company is ready to build the coaches in India if it can get the orders.“India can be a key market for us,” he said.

Source: This Spanish Company Says It Holds the Key to Speed on India’s Crooked Railways – India Real Time – WSJ

03/06/2016

India May Have Won the Battle With Food Inflation Before the First Drop of Monsoon Rain – India Real Time – WSJ

Around this time every year, farmers and economists look to India’s skies, hoping for the arrival of the monsoon rains.

Late and less rain hurts crops and triggers inflation, goes the traditional worry, so every day of delay or deficit in downpours threatens to derail the country’s fragile growth.

The problem with this annual, rational worry, however, is that it’s just, plain wrong.

Good and bad monsoons in recent years have had limited effect on growth or even on food inflation, according to a report this week from Nomura. What is much more important in determining how fast food prices rise, the report says, is the minimum support prices New Delhi sets for certain crucial commodities.

So instead of looking to the skies, central bankers and other inflation fighters should be looking to New Delhi.

This year the monsoon is predicted to be above normal but much more importantly, the weather over the capital is looking promising. On Thursday, India’s weather department upheld its monsoon forecast and said it expects rainfall to be 106% of the long-term average.

On Wednesday the government announced the minimum support prices for the most basic Indian staples–dal and rice—and capped the increases at less than 10%. In some years when the government looked to help farmers it has ratcheted up the prices more than 15%, triggering inflation.

Source: India May Have Won the Battle With Food Inflation Before the First Drop of Monsoon Rain – India Real Time – WSJ

31/05/2016

ONGC Videsh, Azerbaijan’s SOCAR look to jointly sell oil | Reuters

ONGC Videsh has signed a preliminary agreement with the trading arm of Azerbaijan’s state energy company SOCAR to look at jointly marketing crude oil, the company said in a statement on Tuesday.

OVL, the overseas assets acquisition arm of the country’s biggest explorer, Oil and Natural Gas Corp (ONGC), wants to leverage the experience of SOCAR Trading SA in oil marketing, it said.

Reuters had reported about the deal on Monday.

Source: ONGC Videsh, Azerbaijan’s SOCAR look to jointly sell oil | Reuters

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