COVER STORY

India's Exports : Readying for the Big Push

-- N Janardhan Rao and V Ratna

India has turned in an exceptional performance on the export front, which has seen its share in the world trade growing, after lying low at 0.7% for long, to touch a respectable 1%, during the fiscal 2006-07. A slew of recent moves by the government can just give the boost needed to put exports on a high pedestal.

© 2007 IUP . All Rights Reserved

COVER STORY

India's Export Strategy : Employment-oriented Thrust

-- Nagesh Kumar

The past few years have seen a gradual shift in the way India looks at international trade. In the heydays of the import-substitution regime, India tried to substitute imports as much as possible and looked at exports as a way of earning foreign exchange to pay for the imports that could not be substituted, e.g., crude oil. The current mindset, as articulated by the Commerce and Industry Minister, Kamal Nath, while presenting his annual supplement of National Foreign Trade Policy, reflects a refreshing change.

© 2007 IUP . All Rights Reserved

INDUSTRY

Fast Food Industry : Expanding the Horizons

-- N Janardhan Rao and Pratichi Samal

Amidst the growing economy and rising incomes, fast food outlets are introducing a multi-layered product portfolio to address consumer needs while meeting the basic requirements. India is the world's second largest food producer after China, backed by the biggest agricultural sector. The country's food processing industry is one of its largest industries and ranks fifth in terms of production, consumption, export and growth prospects.

© 2007 IUP . All Rights Reserved

INDUSTRY

Global Chip Industry : Consolidation Time

-- Amit Singh Sisodiya and Sanghamitra Dhara

The phenomenon of smart home appliances and other consumer devices like cellphones is globally driving semiconductor makers to ring the wedding bells to capitalize on the trend. A slew of Mergers and Acquisitions (M&As) swept across the chip industry, globally, in 2006. In fact, the technology industry's merger mania of 2006 saw a record number of deals than ever before, churning out transactions worth a huge $45 bn. Some of the high-profile acquisitions included LSI Logic-Agere Systems (AGR), AMD-ATI, and acquisitions of Freescale Semiconductor's and Philips Semiconductors (NXP) by Private Equity consortiums for $17 bn and $11 bn respectively.

© 2007 IUP . All Rights Reserved

INDUSTRY

Entertainment & Media : The Show Goes On

-- N Janardhan Rao and Pratichi Samal

In the midst of healthy economic growth, rising income levels with consequent demand for entertainment, and policy initiatives to encourage investment, the E&M industry is finally emerging. With 54% of the population below 25 years, India is considered as one of the youngest nations in the world resulting in the demand for a variety of entertainment. Today, due to the IT boom, many young people are getting jobs at a very early age and are spending more on entertainment. Against this backdrop, the Indian Entertainment and Media (E&M) industry has emerged among the fastest growing sectors in the country.

© 2007 IUP . All Rights Reserved

FINANCIAL SERVICES

Reverse Mortgage : Towards Social Security

-- Jaishankar Padmanabhan Raja

In India, reverse mortgage programs have not yet been launched. Reverse mortgage assumes importance because in the absence of any other product for senior citizens to obtain loans, reverse mortgage is one such option where they can avail some kind of partial social security in terms of mortgaging their house property and obtaining the reverse mortgage loan. The reverse mortgage loan is mainly meant for the cash poor and asset rich senior citizens.

© 2007 IUP . All Rights Reserved

FINANCIAL SERVICES

Wal-Mart : What's in Store?

-- Amit Singh Sisodiya and Sanjoy De

Growing anti-Wal-Martism and a string of failures in overseas ventures do not augur well for the retailing juggernaut. On April 22, 2007, much to the chagrin of Wal-Mart and its local Indian partner, Bharti Group, Wade Rathke, the Chief Organizer of Association of Community Organizations for Reform Now (ACORN), one of the largest community organizations of low and moderate income families in the US, gave an emotional speech exhorting locals and warning policy- makers against corporate participation (read: Wal-Mart) in retail.

© 2007 IUP . All Rights Reserved

CORPORATE STRATEGY

Wockhardt : French Foray

-- Amit Singh Sisodiya and Sanjoy De

Continuing its Merger and Acquisition (M&A) spree in the European market, the Indian drug major Wockhardt recently acquired Negma Laboratories, the fourth largest independent and research-based pharmaceutical group in France, in a deal worth $265 mn. The all-cash deal marks the Indian firm's fifth acquisition in Europe after it acquired Wallis, CP Pharmaceuticals (both UK-based), Germany's Esparma, and Ireland's Pinewood Laboratories.

© 2007 IUP . All Rights Reserved

APOLITICAL

Attack on Reliance Fresh : It's All about Margins!

-- grk

There is a village called Narakoduru in the coastal belt of Andhra Pradesh. Like in any other village, the residents of this village too eke out their living by tilling soil. There is, of course, a difference: they grow only vegetables. Their village is popularly known as a vegetable bowl of the coastal Andhra. This popularity has, however, not altered their lives, for like any other farmer they too suffer from poor farm-gate prices - but more silently.

© 2007 IUP . All Rights Reserved

BUSINESS ENVIRONMENT

Rupee's Rise : A Mixed Vice!

-- Amit Singh Sisodiya and Sanjoy De

Ever since the introduction of economic reforms in 1991, the rupee-dollar graphs have been monotonously one-way, with the Indian rupee value declining against the greenback. However, in the past few years, the trend has reversed as the rupee has witnessed a steroidal increase, which saw it touching a nine-year high of 41.58 per dollar on April 24, this year (it had touched a high of 41.55 in 1998), which also made it the top performing Asian currency this year so far, fetching a return of about 7% against 3.6% by the second best performing currency, Thai baht.

© 2007 IUP . All Rights Reserved

BUSINESS ENVIRONMENT

Indian SMEs: IT's Big Chase

-- Amit Singh Sisodiya and P Kavitha

The burgeoning Small & Medium Enterprises (SMEs) segment in the country finds a host of IT firms-including global biggies such as Microsoft, IBM, Cisco, and Oracle-hot on its trail. Big IT firms craving for growth are fast turning to SMEs, globally. Little wonder then that the focus is now increasingly on the Asia-Pacific region (excluding Japan), thanks to the burgeoning number and growth potential of SMEs there. For instance, according to a forecast by the research firm, IDC, domestic IT spending in India is expected to reach Rs. 75,891 cr in 2007, followed by a major wave of IT investments across different sectors.

© 2007 IUP . All Rights Reserved

BUSINESS ENVIRONMENT

Infrastructure Management Services : Tapping the Untapped

-- Y Bala Bharathi

India Inc., after proving its mettle in the IT-related and IT-enabled services businesses, has been gearing up to capture a major chunk of the potential Infrastructure Management Services (IMS) pie. For years, IMS has been a relatively untapped market opportunity for India. However, in recent years, industry experts are touting IMS as the third wave of outsourcing to hit the Indian shores next to software and Business Process Outsourcing.

© 2007 IUP . All Rights Reserved

BUSINESS ENVIRONMENT

Realty Sector : Reality Bites

-- Amit Singh Sisodiya and P Kavitha

An across-the-board boom in SEZs (Special Economic Zones), residential, retail, and commercial property segments has seen the domestic realty sector register an unprecedented growth during the last couple of years. The domestic real estate sector has grown at a rate of 30% per annum and is expected to more than triple to $60 bn by 2010 from $12-16 bn at present. During 2006, the sector witnessed some of the biggest land deals such as Unitech's purchase of 300 acres in Noida for Rs.1,583 cr, and Mukesh Ambani-owned Reliance Group's purchase of 7.5 hectares of commercial property in Mumbai for Rs.1,104 cr. In fact, the year saw a kind of gold rush towards the sector as not only the domestic deals flourished, but also foreign investments soared significantly.

© 2007 IUP . All Rights Reserved

BUSINESS ENVIRONMENT

Australian Economy : Losing Sheen?

-- Siba Prasad Pothal

Any assessment of Australia's potent, vibrant, and globally competitive economy may present it as a `miracle economy'. With dynamic private sector and a skilled and flexible workforce, the nation's spectacular economic performance stems from efficient economic management and ongoing structural reform. The economy has been in a happy state for much of the past several years.

© 2007 IUP . All Rights Reserved

BUSINESS ENVIRONMENT

Outsourcing : Losing Cost Advantage?

-- N Janardhan Rao and B Suma

The outsourcing industry has emerged as the golden goose of the moment going by India's inherent strengths. The business of outsourcing has been witnessing tremendous growth and diversifying the focus from voice-based contact solutions to knowledge-based services. About 70% of today's IT-enabled services are easily carried out from remote offshore locations.

© 2007 IUP . All Rights Reserved

BUSINESS ENVIRONMENT

Global Carmakers : Emerging Markets Drive

-- Amit Singh Sisodiya and Madhuparna Chakraborty

Unable to stem the loss in market share in their domestic markets owing to stiff competition from Asian rivals, western carmakers are eyeing to tap Asian markets to sustain their growth. When Germany's Bayerische Motoren Werke AG (BMW), the world's largest maker of luxury cars, opened its first manufacturing unit in India, it signaled the growing prominence of Western carmakers here. More Asian, more appropriately emerging, economies are beginning to be noticed by automobile manufacturers from the US and Europe.

© 2007 IUP . All Rights Reserved

BUSINESS ENVIRONMENT

Executive Compensation : Let the Market Decide

-- N Janardhan Rao and V Ratna

With executive pay becoming an increasingly hot-pressed issue and the gap in pay between rank-and-file employees and top executives widening, will the SEC new rules serve the purpose? In the modern business history, the issue of executive compensation has been one of the hottest topics. It was earlier relegated to the relative darkness of business periodicals. However, the issue of executive pay is debated globally and regularly featured in front-page headlines after former Home Depot CEO, Robert Nardelli's $210 mn pay-for-failure became public.

© 2007 IUP . All Rights Reserved

BUSINESS ENVIRONMENT

US Economy : Heading for Recession?

-- N Janardhan Rao and B Suma

Amidst the ongoing housing slump, rapidly rising energy prices and falling consumer confidence, it is feared that the world's major economy might be heading for recession. In April 2007, the US Commerce Department reported that the economy grew at its weakest pace since 2003. Against the rising energy prices, inflation is on the rise, housing slump is at its peak, and the dollar is dwindling against the euro. The economy grew at an annual rate of 1.3% in the first quarter of 2007, the slowest rate of expansion in four years.

© 2007 IUP . All Rights Reserved

BUSINESS STRATEGY

Harry Potter and the Magic of Sales : What Does the Future Hold for Bloomsbury?

-- R Venkatesan Iyengar

The publication of the Harry Potter series is undoubtedly the publishing event of the century. But the question is: Is Bloomsbury ready for the post-Potter future? Will `the boy who lived' meet with a tragic end finally? That is the question which has been troubling millions of Harry Potter fans all over the world for quite some time now. As the readers are preparing for the `scar', which the author JK Rowling has said is going to be the last word of the seventh and final novel in the Potter series-Harry Potter and the Deathly Hallows, the publishers of Harry Potter series, Bloomsbury Publishing Plc., UK, might be preparing for a scar of a different kind.

© 2007 IUP . All Rights Reserved