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08/08/2016

This Is Why It Is Difficult to Make in India – India Real Time – WSJ

PHOTO: Employees worked on the cabin of a Sikorsky S-92 at the Tata Advanced Systems Ltd. facility at Adibatla in the south Indian city of Hyderabad, June 07, 2016.

Having signed a string of multibillion-dollar orders from foreign firms to make parts for helicopters, jet fighters and trains, India is struggling to find people with the skills to build them.

In a $3.3 billion push, it is racing to equip 15 million people by 2020 with the skills necessary to realize Indian Prime Minister Narendra Modi’s aim to bring more high-grade manufacturing to the country.

But the challenges are significant at a time when foreign suppliers including Boeing Co., Airbus Group SE and Alstom SA often can’t find the employees with the training and experience to help fulfill Mr. Modi’s ‘Make in India’ program.E

More than 80% of engineers in India are “unemployable”, Aspiring Minds, an Indian employability assessment firm, said in a January report after a study of about 150,000 engineering students in about 650 engineering colleges in the country.

A lack of specialized courses mean companies have to train their own people from scratch. At one training center outside Hyderabad in southern India, young workers in their early 20s toil with high-precision hand tools as they are taught for the first time how to fix rivets on aircraft-grade aluminum sheets as part of a year-long training program.

Source: This Is Why It Is Difficult to Make in India – India Real Time – WSJ

Posted in Economics, education, India alert, Manufacturing, Social & cultural | 1 Comment »

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08/08/2016

India’s Controversial Cow Protection Group Conducts Cattle Census – India Real Time – WSJ

A group concerned about the safety of India’s cows has embarked on a controversial and ambitious mission this month: counting all the cattle in the state of West Bengal.

“Our aim is to save the cow mother,” said Subrata Gupta, president of the Bengal branch of Cow Development Cell, which used to be associated with Prime Minister Narendra Modi’s ruling Bharatiya Janata Party.

The group will use the data to protect the state’s cows, many of which are being illegally exported to Bangladesh and Pakistan for slaughter, said Mr. Gupta.

The status of cows — an animal deeply revered in Hinduism – is a divisive issue in the country. Critics say conservative Hindu groups, emboldened by the BJP’s power in New Delhi, are eating away at the country’s secular roots by trying to ban beef consumption.

Over the weekend Mr. Modi spoke out against self-styled vigilantes who say they are trying to protect cows. He urged state governments to punish them when they use cow protection as a rationalization for hate crimes.

Cow slaughter is already illegal in many Indian states–including Uttar Pradesh where a Muslim man was killed by a mob last year following rumors he had slaughtered a cow for food.

The eastern state of West Bengal, however, allows the killing of cows during the Islamic religious festival of Eid.

Around 6,000 volunteers from Mr. Gupta’s group are going door-to-door across state to record how many cows each household owns. The group wants to finish the survey before Sept. 12, when Muslims will celebrate Eid.

“Thousands of cows are being smuggled across India’s border into Bangladesh, where they will be slaughtered,” said Mr. Gupta of the Cow Development Cell which has groups apprehending cattle trucks, even though it has no legal authority to do so.

He said activists from the group freed about 40,000 animals last month.

The BJP recently broke ties with Mr. Gupta’s Cow Development Cell.

“It was an all-India decision that a separate cell for cow development is not needed,” said Dilip Ghosh, president of the BJP in West Bengal.

That hasn’t stopped Mr. Gupta and his army of self-styled cow protectors who say they will release the results of the cow census on Sept. 15.

Source: India’s Controversial Cow Protection Group Conducts Cattle Census – India Real Time – WSJ

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05/08/2016

Bridge Collapse Is Latest Tragedy on India’s Roads – India Real Time – WSJ

The collapse of a bridge in the western Indian state of Maharashtra this week that left 14 people dead and 18 others missing wasn’t the first road tragedy to hit the area.In 2013, a bus veered off a 80 year-old bridge on the Jagbudi river, which flows parallel to the Savitri about 70 kilometers (43 miles) to the south, killing 37 of the 52 people on board.

That accident happened when a bus flew off the bridge and flipped in midair before landing on its roof 30 feet below.

The Wall Street Journal took a deep look into the tragedy.

Such incidents are alarmingly frequent on India’s roads.

India has been spending more money to improve its bridges, ports and airports, but the Savitri accident is yet another example of how the country’s depleted infrastructure is under increasing strain due to the rising demands of a fast-developing economy.

Its ageing road network, the world’s second-largest after the U.S. but largely made of dirt tracks, is particularly challenging. India’s roads are the most dangerous in the world: In 2015, the country accounted for almost one in 10 road casualties world-wide, according to the World Health Organization.

While India reported 137,000 deaths due to road crashes in 2013, the WHO estimated the figure was much higher. Those deaths cause an approximate 3% loss in economic output, it said.

Two buses and a number of cars plunged into the Savitri river in the early hours of Wednesday when the bridge in Mahad, built before India gained independence from Britain in 1947, crumbled into the waters below amid heavy monsoon rains.

Maharashtra Chief Minister Devendra Fadnavis has ordered a judicial probe into the accident and said government technicians will carry out a safety audit of old bridges in the state.

The bodies of 14 people were recovered from the waters of the Savitri by Friday morning, and 18 more are missing, National Disaster Response Force Commandant Anupam Srivastava said.

Source: Bridge Collapse Is Latest Tragedy on India’s Roads – India Real Time – WSJ

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04/08/2016

Poland in talks with Chinese buyers over LOT airline stake | Reuters

Poland is in talks with potential investors from China over selling a stake in the state airline LOT [LOT.UL], Deputy Prime Minister Mateusz Morawiecki said on Wednesday.

Poland’s euroskeptic, conservative government has been looking to tighten its relations with China since coming to power last year. The two countries pledged deeper co-operation during the visit of China’s leader Xi Jinping to Warsaw in June.”LOT is our national carrier, which we are trying to save no matter the cost. It is deeply in debt,” Morawiecki told state news agency PAP on Wednesday, adding that without a national carrier Poland would become a more peripheral country.

LOT, one of the world’s oldest airlines, has for years struggled to compete against low-cost competitors like Ryanair (RYA.I) and bigger rivals. The state-owned airline was saved from bankruptcy in 2012 thanks to public aid of more than 500 million zlotys ($130 million).

“The previous government has already granted public support for LOT, we cannot grant another and we are looking for an investor,” Morawiecki said.

“According to EU law a carrier from outside the EU cannot take over more than 49 percent of a carrier from the EU, hence we are in talks with potential investors, among others, from China,” he said.Morawiecki also said that usually it is a very long road to finalize such a transaction.

Earlier on Wednesday, a Polish local newspaper reported that Chinese carrier Air China (601111.SS) is interested in buying a 49-percent stake in LOT with a delegation from the Chinese firm expected to arrive in Warsaw over the coming days.

However, a LOT spokesman said he had no knowledge of any plans for a capital tie-up between LOT and Air China.

“I have no knowledge regarding any planned capital co-operation between LOT and Air China,” Adrian Kubicki, LOT spokesman said. “We have commercial co-operation with Air China, which we want to develop, regarding the Warsaw-Beijing route.”

Air China was not immediately available for comment.

Source: Poland in talks with Chinese buyers over LOT airline stake | Reuters

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04/08/2016

Rude Chinese banned from going on holiday | The Times & The Sunday Times

“Uncivilised” Chinese tourists who commit such crimes against etiquette as asking foreigners for selfies, throwing nut shells around or defacing historical sites may find themselves stuck at home because their names are on a travellers’ blacklist.

Authorities in China have been cracking down hard on individuals who sully the country’s name abroad by acting rudely or violently, and the national tourism administration introduced a blacklist for the worst offenders last year.

A draft regulation released this week will, if passed, allow government agencies and tour companies to share blacklists and bar trouble-makers from future trips.

As well as travel companies, government organisations such as customs control, quarantine and border protection bodies would potentially be able to access the blacklist and take measures against those on it.

So far the blacklist contains only 19 names. The administration said that behaviour that could lead to a tourist being blacklisted included “damaging public facilities or historical relics, ignoring social customs at tourism destinations and becoming involved with gambling or prostitution”.

The regulation draft, which is in its public comment phase, stated: “Punishments can be imposed by travel agencies or other related agencies or organisations based on the record.

”Some analysts questioned how effective implementation of the rule could be. Liu Simin, of the China Society for Futures Studies research group, said: “If tourism authorities want to restrict blacklisted tourists from travelling overseas, they can do this only through travel agencies. If travellers plan their own trips and skip the agencies, they’re out of reach.

”The introduction of the blacklist came after President Xi told Chinese tourists in 2014 to clean up their act when abroad to help to dispel negative stereotypes about them.

Talking in a light-hearted fashion, he said: “Do not litter water bottles everywhere. Do not damage coral reefs. Eat less instant noodles and more local seafood.

”The year before the president’s comments, Chinese tourists spent more than £14.5 billion on holidays abroad — more than any other country.

Badly behaved Chinese tourists have continued to make headlines since the introduction of the blacklist.

Last week a Chinese woman was arrested for common assault after throwing orange juice at a flight attendant on a flight from Dubai to Hong Kong. She is understood to have been angry because meals for her children had not been prepared by airline staff in advance.

Source: Rude Chinese banned from going on holiday | World | The Times & The Sunday Times

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04/08/2016

5 Sectors That Will Benefit From India’s Proposed Tax Overhaul – WSJ

5 Sectors That Will Benefit From India’s Proposed Tax OverhaulIndia’s upper house of Parliament on Wednesday approved an overhaul of the country’s tax system that, if passed in the lower house, will lead to the implementation of a nationwide goods-and-services tax, or GST.

Here are five sectors that stand to gain.

1 Automobiles

The GST will make cars more affordable in India as it will reduce the taxes levied on the vehicles.India currently has four factory-gate tax rates of 12%, 24%, 27% and 30%, depending on the vehicle’s specifications. On top of that, there are value-added taxes, which range from 12.5% to 14.5%.

The GST will subsume all theses levies into one and passenger vehicles will likely fall into one of  two tax bands: 18% to 20% for regular cars, and up to 40% for luxury autos.

2 Logistics

Haulage and logistics companies will be able to reduce transit hours because the simplified system will mean that their drivers won’t have to wait for so long at borders to pay levies.

Currently, some companies use smaller transporters that charge lower fees because they are able to avoid paying taxes due to the inefficient system. But a more transparent tax system will mean the smaller companies are more likely to pay, leveling the field for larger players.

India’s leading 10 listed logistics companies command less than 5% of the overall market, according to a KPMG report. Stocks of some companies such as AllCargo Logistics Ltd. and Transport Corp of India Ltd. have gained more than 15% in the past month in anticipation of the passage of the GST legislation.

3 Media and entertainment

Cinema multiplex operators now pay entertainment taxes as well as several other levies to federal and state governments. The entertainment tax can be as high as 27% and operators must pay that as well as a service tax of about 15% on advertising revenue.

GST is expected to cut that tax bill, lowering operational costs and boosting margins.

Motilal Oswal Securities says that a GST rate of 18% may improve operating profit of PVR, the largest listed multiplex operator, by as much as 26%.

4 Retail

Consumers’ disposable income is expected to rise in the medium term if the GST rate turns out to be lower than current levies, boosting demand.

A more efficient tax system will also mean that market-stall owners and roadside vendors are more likely to pay tax, analysts say. That will create a more level playing field for larger shops and retailers who already pay.

The retail sector will likely also benefit from lower logistics costs as well as a fall in rental costs. Retailers currently shell out about 10%-15% of their operating expenditure on rent and infrastructure services, on which service tax is levied. But that levy would be reduced post-GST, benefiting retail companies like Future Enterprises Ltd. and Shoppers Stop Ltd.

5 Cement

Overall tax for the cement sector will likely to come down if the GST rate is set at 18%, Kotak Securities says.

After the implementation of the uniform tax, cement companies would likely pay about 920 rupees ($13.78) in tax per ton, down from about 1,320 rupees currently, the broker says. It also expects cement firms to benefit from a more efficient logistics system. This will cut costs for consumers and also help the government achieve its aim to provide housing for all by 2022.

Source: 5 Sectors That Will Benefit From India’s Proposed Tax Overhaul – WSJ

Posted in Economics, India alert, Tax | 1 Comment »

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03/08/2016

Road test for homegrown transit elevated bus| Innovation

The transit elevated bus TEB-1 is on road test in Qinhuangdao, North China’s Hebei Province, Aug 2, 2016. China’s home-made transit elevated bus, TEB-1, conducted a road test running Tuesday.

The 22-meter-long, 7.8-meter-wide and 4.8-meter-high TEB-1 can carry up to 300 passengers. The passenger compartment of this futuristic public bus rises far above other vehicles on the road, allowing cars to pass underneath. [

Source: Road test for homegrown transit elevated bus[1]| Innovation

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03/08/2016

India’s biggest tax reform GST looms, many companies unprepared | Reuters

Throughout years of political gridlock, the risk that India might pass its biggest tax reform since independence appeared reassuringly remote for many businesses.

Until now.Suddenly, the prospect that a new Goods and Services Tax (GST) could enter force next year has bosses panicking at the likely impact and seeking advice on how to cope.

The expected passage by parliament on Wednesday of a key constitutional amendment would resolve crucial issues needed to transform India’s $2 trillion economy and 1.3 billion consumers into a single market for the first time.

The amendment is likely to clear the Rajya Sabha after the opposition Congress party, which originally proposed the GST while in power, wrung concessions from Prime Minister Narendra Modi‘s government.

Yet the vote will only fire the starting gun in a legislative marathon in which the national parliament and India’s 29 federal states have to pass further laws determining the – still unknown – rate and scope of the tax.

At the same time, a huge IT system needs to be set up, tax collectors trained and companies brought up to speed on a levy that experts say will force them to overhaul business processes from front to back.

One boss who isn’t ready is G.R. Ralhan, head of Roamer Woollen Mills in the northern city of Ludhiana.

“Companies, particularly smaller ones, are apprehensive,” Ralhan told Reuters, calling for more time to adjust and saying a high rate of GST could put his firm out of business.

Countries that have introduced GST in the past have often faced a relative economic slowdown before the benefits of a unified tax regime feed through.

India is already the world’s fastest growing large economy, expanding by 7.9 percent year-on-year in the March quarter. Economists at HSBC forecast a boost of 0.8 percentage points from the GST within three to five years.

80-20 RULE

Tax experts say that only 20 percent of – mostly big – firms are getting ready for the GST. The rest are taking things as they come in a country where coping with a changing tax regime has been a way of life for decades.

Yet even those actively preparing must contend with a series of unknowns as the national and state parliaments tackle the task of transforming a “model” GST law into the real thing.

The first hurdle will be for a majority of state parliaments to pass the GST amendment, which would establish a GST Council to finalise key terms of the new tax.

That could take until November and mean that the legislation to put the GST into force would only come before the national parliament’s winter session.

Hitting the government’s target launch date of next April 1, the start of the fiscal year, looks ambitious. Slippage to July or October 2017 is increasingly likely, say experts.

Source: India’s biggest tax reform GST looms, many companies unprepared | Reuters

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03/08/2016

Startups hope to capitalize on the massive IoT market – Times of India

Fresh from the sale of their first venture focused on the heating, ventilation and air conditioning (HVAC) market, Shishir Gupta, Nithin David and Varun Gupta embarked on what they thought was their next breakthrough idea.

In mid-2013, the trio decided to devise solar air conditioners based on their previous experience in the market but, after some pilots, they discovered the idea was commercially unviable.

From the ashes of their second enterprise, they did manage one small gain — a connected controller that reduced energy use by 30% during the night. Using this, they pushed their entrepreneurial energy in a new direction — towards the rapidly emerging opportunity in the internet of things (IoT) , or devices and objects that send and receive data over the internet. Rather than build large systems for this, their new venture Oakter is thinking much smaller. It is building out a series of IoT-based devices to “smarten” homes across India.

In around two years of operation, Oakter’s controllers have smartened some 10,000 gadgets, claims Shishir Gupta, without disclosing the number of homes his controllers have been installed in currently. The startup’s full launch hasn’t even happened, he says, since it is still reaching out informally to consumers. Around Diwali this year, Oakter is expected to make a big-bang offline launch and expects to reach 10,000 homes in a year and revenues of Rs 100 crore by 2018-19.

“Within 10 years, IoT will transform the way we manage our lives,” says Shishir. There are plenty of data points to back his enthusiasm. In 2008 itself, there were more objects connected to the internet than people, and technology researcher Gartner forecasts that by 2020 there will be nearly 21 billion connected devices. If the ATM was perhaps the first popular connected device in the early 1970s, hundreds of companies have since shown an interest in getting wired up.

IoT’s the Thing

In the US, the largest technology market, there has been a mixed response to various kinds of IoT. According to CB Insights, a tracker of this kind of deal data, deal volume is on track to surpass 2015’s total by 30%. Fundingwise, 2016 should be a robust year for IoT in the West, and the second year in a row of $1.2 billion-plus in funding. Several startups in the field raised significant amount of funding, including IoT software and services company Greenwave Systems ($45 million Series C), commercial drone developer Airware ($30 million Series C), and connected HVAC and lighting company Enlighted ($25 million Series D financing).However, deal flow looked less upbeat on a quarterly basis, with both value and volume declining in the second quarter of 2016. After an increase in the first quarter with 54 transactions, deal-making fell 26% quarter-over-quarter. And funding fell from $328 million to $325 million — a 9% quarter-on-quarter decline. At a global level, there is massive potential.

According to a statement from Gartner’s research chief Peter Sondergaard, the incremental revenue generated by IoT suppliers is estimated to reach $309 billion per year by 2020. This growth opens up new business opportunities, as half will be attributed to new startups and 80% will be in services, not products. Manufacturing, healthcare and insurance are expected to lead the IoT race.

Some of this entrepreneurial interest is being generated in India, too. For example, in May this year, Entrepreneurship and Venture Capital (EVC), an early stage investor, launched a $50 million unit to focus on IT.

Qualcomm Ventures, the VC arm of the global chipmaker, recently unveiled its $150 million India fund and made its first investment of $10 million in healthcare IoT venture Attune Technologies. In early July, a centre of excellence for IoT was launched jointly by software industry lobby Nasscom, the department of electronics and information technology and the Education and Research Network. This centre can house up to 40 startups and the model is expected to be replicated nationwide.

Source: Startups hope to capitalize on the massive IoT market – Times of India

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02/08/2016

India to impose temporary anti-dumping duty on some steel products | Reuters

An Indian government body has recommended provisional anti-dumping duty on imports of hot-rolled steel products, a government statement said on Tuesday, to reduce overseas purchases of the alloy and shield local mills.

The anti-dumping duty will come into effect after New Delhi formally notifies the tax.

The Directorate General of Anti Dumping recommended the duties on steel products from China, Japan, South Korea, Russia, Brazil and Indonesia, the statement said.Indian steelmakers such as the Steel Authority of India (SAIL.NS) , JSW Steel (JSTL.NS) and Tata Steel (TISC.NS) had lobbied for protectionist measures to prevent cheap overseas purchases that were undercutting local mills and squeezing margins.

Source: India to impose temporary anti-dumping duty on some steel products | Reuters

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