COVER STORY

Mumbai's Crumbling Infrastructure : Whither Future?

- - Amit Singh Sisodiya, Sanjoy De and Ratna T

Mumbai, unlike any other city in the world, has many identities. For millions of ordinary citizens of the country, it is the city of their dreams, for businesses it is the country's financial hub, and for millions of homeless it is their home. However, the city that gives cover to a populace of 18 million and more is itself scurrying for cover as its infrastructure crumbles and crumbles fast. The home to Bollywood and the highest tax payers in the country, shockingly, faces the biggest ever challenge of saving itself amidst collapsing infrastructure, deteriorating public transport, lack of space, inadequate shelter space, improper sanitation, sprawling slums, inequality and poor governance. Contrastingly, it is the only Indian contender, with all its indomitable spirit to become a world-class city. What a dichotomy? But the bigger issue is: Can Mumbai's infrastructure woes be fixed?

© 2007 IUP . All Rights Reserved

PERSPECTIVE

Budget 2007 : Victim of Rising Inflation?

- - GRK Murty

When sorrows come, they come not single spies/But in battalions, said the bard. And that is what is haunting the dream team of India's economic management today. Till inflation has raised its ugly head once again, everyone thought that India is successfully journeying from a regulated economy to free market economy without any hiccups.

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MEDIA

British Broadcasting Corporation : Challenging Times Ahead

- - N Janardhan Rao and Pratichi Samal

The oldest media organization, which revolutionized the media world, is now facing daunting investment challenges along with the demands of the digital age and a fiercely competitive globalized media environment.The world's largest public-service broadcaster, BBC, which began international broadcasting more than 70 years ago, has a record weekly global audience of 163 million. It is now facing an era of austerity against the challenges of frail finances, essentially required for creating the fantastic content that its customers and audiences expect. The ongoing digital revolution is challenging the business models which had been adopted by the BBC for so many years.

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FINANCIAL SERVICES

Doorstep Banking : A Welcome Move

- - D Satish and Y Bala Bharathi

With the comeback of Doorstep Banking in India, bank customers can now look forward to home delivery of banking services. Why go to a bank when bank itself comes all the way to your doorstep? With the revisiting of doorstep banking, which works on this very notion, now the busy customers of the modern era have a big reason to smile. It is quite an undisputed fact that the value of time has been increasingly getting precious for the modern man with the increasing work pressure and tight schedules.

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INTERNATIONAL FINANCE

Dual Currency System : China's Pride, World's Envy

- - Amit Singh Sisodiya and Sanjoy De

China's dual currency system places it in an envious position, which no other country can match. Is it unfair for the other economies of the world?A decade ago, on July 1, 1997, at midnight, when Britain handed over the reins of Hong Kong to People's Republic of China (PRC), even the most prophetic of the economists could not have gauged what unprecedented consequences the rest of the world would be left dealing with. The historic transfer process, which ended 155 years of colonial dominance, immediately carried with it usual euphoria as well as tension and mutual mistrust between the neo-liberal Hong Kong and relatively less liberal China.

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BUSINESS ENVIRONMENT

Vodafone's Mega Deal : The Giant Comes Calling

- - N Janardhan Rao

With a resounding furor over the acquisition of Hutchison Essar, Vodafone emerged as the winner and will get strong access to one of the world's fastest-growing mobile phone markets. India's mobile market is booming. It is now the world's fastest-growing and most promising mobile phone markets with more than 140 million users and adding about six million subscribers every month. The market is growing by around a whopping 55% a year. The figure is expected to be somewhere around 200 million subscribers by the end of the current year.

© 2007 IUP . All Rights Reserved

BUSINESS ENVIRONMENT

Aerospace Engineering Outsourcing : Opportunities for IT Companies

- - Dr. Nandan Kumar Sinha

Indian software firms are well placed to grab a bigger share of the aerospace market. Nasscom predicts that the sector has potential to reach about $4 bn by 2020. There are several reasons behind its predictions. With the need to cut costs of travel becoming paramount, major aircraft manufacturing companies are under tremendous pressure to reduce development costs and improve the operating efficiency of their aircraft. Engineering services have a significant bearing on both.

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BUSINESS ENVIRONMENT

Hindalco-Novelis : Aligning for Aluminum

- - Amit Singh Sisodiya and Sanghamitra Dhara

The largest cross-border deal in the history of Indian aluminum industry, while looking glorious on paper, could prove to be far more challenging for India's aluminum giant, AB Birla's flagship company, Hindalco. Close on the heels of the megabillion dollar acquisition of Corus by Tatas comes another high-profile cross-border acquisition; but this time by AV Birla Group-owned Hindalco. India's largest aluminum player acquired the Atlanta-based Novelis, the world's largest producer of aluminum rolled products (semi-finished products for inputs for manufacturing such value-added products as automotive body panels) and aluminum can recycling, and whose client list boasts of such impressive names as Ford, Kodak, Coca-Cola, and Audi among other high-profile global customers.

© 2007 IUP . All Rights Reserved

BUSINESS ENVIRONMENT

Indian Railways : Becoming Market-savvy

- - D Satish and Siba Prasad Pothal

It has been a long journey for the Indian Railways so far, with many ups and downs. But it still has a lot further to go in order to become an efficient national logistics provider. Indian Railways has always been the lifeline of the country, connect- ing every nook and corner with railway tracks crisscrossing its length and breadth. Usually, attracting media attention for all the wrong reasons like disasters and accidents, Indian Railways, the largest in the world, recently hogged the limelight for raking in whopping profits to the tune of Rs. 20,000 cr for the year 2006-07! This was declared by the Honorable Railway Minister, Lalu Prasad Yadav, while presenting the railway budget.

© 2007 IUP . All Rights Reserved

BUSINESS ENVIRONMENT

Aerospace Outsourcing : Sky is the Limit

- - N Janardhan Rao and Pratichi Samal

Backed by an abundant and quality engineering workforce, and with engineering being the core strength of the Indian IT companies, the country is placed well to cash in on the ongoing aerospace boom. Amidst the global civil aviation boom and the country's increas- ing defense expenditure, aerospace outsourcing is emerging as one of the key segments in India's outsourcing services. Backed by competitive skills in engineering services, India is poised to become a key outsourcing hub for global aerospace and missile companies. The recently concluded Aero India air show indicates the growing importance of Bangalore's aerospace potential. The show, labeled as the largest in South Asia, saw more than $1.2 bn worth of deals being signed between Indian and foreign aerospace firms.

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FINANCIAL MARKETS

Hybrid Funds : Crossing Private Equity and Hedge Funds

- - D Satish and Y Bala Bharathi

Hybrid funds which promise to offer the benefits of both Private Equity and Hedge Funds are gaining popularity in India.Thanks to the convergence trend of Private Equity (PE) funds and Hedge Funds (HFs), Indian capital markets have been witnessing the gradual emergence of a new breed of alternative investments known as hybrid funds or multi-strategy funds. These funds offer the best of both the PEs and HFs, which have since been gaining ground in India.

© 2007 IUP . All Rights Reserved

FINANCIAL MARKETS

Global IPOs : Wall Street on the Back Foot?

- - Amit Singh Sisodiya and Madhuparna Chakraborty

Blame it on rising costs, attributed to Sarbanes-Oxley Act (SOX), and increased competition from rival foreign exchanges, which have Wall Street on the back foot. A recent report by the global consultancy firm, McKinsey, la- mented that a number of US firms, big and small, are increasingly preferring overseas bourses-notably London-over domestic exchanges like New York Stock Exchange (NYSE) so as to avoid having to deal with the dreaded Sarbanes Oxley Act, 2002 (also referred to as SOX), which came into existence in the wake of accounting scandals involving high-profile firms like Enron.

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CORPORATE STRATEGY

Citigroup: Citi Sleeps!

- - N Janardhan Rao and Ratna T

The world's largest financial services company-Citigroup-is struggling to polish its image, which has been tarnished by a series of scandals over time.The top management at the Citigroup has been struggling to restore its credibility, operational expertise and bring the bank's performance back on track. The task is not that easy as the group is harvesting negative headlines. The recent scandals-the Thompson scandal, the "phishing and skimming" e-mail frauds and the leakage of a US Citibank customers' accounts at an Indian call center-have been a major blow to the company, especially in the US. The various scandals involving Citigroup have flawed its image among some shareholders, analysts and employees.

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CORPORATE STRATEGY

Airbus : Restructuring Blues

- - N Janardhan Rao and B Suma

In spite of problems, Airbus is struggling to keep its customers on board with its new initiative "Power8". Europe's largest aircraft maker, Airbus, which once ruled the in- dustry, is now caught in a storm, paralyzed with a loss of $1 bn. Its ongoing struggles indicate its efforts to restructure itself even as its delivery delays continue to be its weak spot. This is causing a serious problem not only to Airbus but also to its parent company, European Aeronautic Defense and Space (EADS). Indeed, it failed in delivering Super-jumbo A380 on time, because of its major production troubles.

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CORPORATE STRATEGY

Dell: CEO Shake-up

- - Amit Singh Sisodiya and Madhuparna Chakraborty

The recall of Michael Dell raises the concern that all is not well with the ruthless cost-cutter. However, a much bigger question is: Can the comeback CEO prove to be the savior of the PC maker, which is facing fierce competition from the now resurgent HP? A series of mishaps, one after another, ranging from a massive recall of potentially self-igniting laptop batteries, a dismal earnings report, to an announcement by the computer maker that it is under Securities and Exchange Commission's scrutiny for the way it counts revenues possibly were more than enough for Michael Dell to put an end to the journey of Kevin Rollins, the former CEO of Dell Inc. with the company and to reclaim the position.

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CORPORATE STRATEGY

Enterprise Software : Enter Google

- - Amit Singh Sisodiya and Kavitha Putta

Google's entry into the enterprise software market does not bode well for the incumbents, Microsoft and the Big Blue. There is yet another reason for Microsoft to lose sleep. The latest move by Google to encroach into the business application software arena, so long solely dominated by Microsoft, is sure to cause some discomfort to the latter, although Bill Gates & Co. would deny it. Nonetheless, the "innovation powerhouse" is making a concerted effort to grab a pie of the multibillion dollar business software application, globally. It also marks the search engine giant's first but real serious move to challenge the hegemony of its biggest rival as it attacks the latter's most lucrative market: The Desktop.

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CORPORATE STRATEGY

British Petroleum : Spilled Oil

- - Amit Singh Sisodiya and Sanjoy De

A series of safety lapses at its US refineries claims the job of its boss Browne and puts the British oil "Super-major" in a tight spot.In a most astonishing development, John Browne, the Head of BP (British Petroleum), Europe's second largest oil company and world's third largest after ExxonMobil and Royal Dutch Shell, announced in January, this year, the decision to step down from his post 17 months ahead of his scheduled retirement. The news took the markets and industry watchers by surprise as no one expected the man who was instrumental in transforming BP from being an obscure oil company into a "Super-major", the elite club of global big oil companies, to leave the company in haste.

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APOLITICAL

Nandigram: It Says India Is Not China

- - grk

Mangoes are cultivated extensively in Andhra Pradesh, while Kashmir is known for extensive cultivation of apples. But apples cannot be cultivated in Andhra Pradesh and similarly mangoes are not grown in Kashmir. This is a known fact but the question is, `why'? It is all `atmospherics', which is a given - what mango and apple need to grow is provided by nature and that is in abundance at these two places. That is the reason why mangoes are cultivated in Andhra and apples in Kashmir but eaten all over India.

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ARTS AND ARTISTS

Mythical Art of Greece

- - Dr. P G Nirmala

Much has been written about the citadel of art and culture of the ancient western world-the isles of Greece, the austere yet beautiful land of astonishing variety. The Western world has had a long-standing engagement with the arts of war and peace of ancient Greece. The Golden Age of Athens, the Age of Pericles, has come to symbolize perfection in human civilized life. The "Greek miracle", signifies the achievements of ancient Greece in fields of art, literature, philosophy and governance, which has shaped the Western civilization over the ages.

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