International Perspectives on India

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International Perspectives on India

• India is now enjoying a rising status in the
  international arenait has embarked on all round
  reforms and achieved rapid economic
  growth...China rejoices at the achievements made
  by India in its development. Mr Zhu Rongji,
  President, Peoples Republic of China on his
  visit to Mumbai in January, 2002
• You liberated your markets and now you have one
  of the 10 fastest growing economies in the world
  - Bill Clinton

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GENERAL FACTS

• LAND AREA 3.29 MILLION SQUARE KILOMETERS
• CAPITAL NEW DELHI
• GOVERNMENT DEMOCRATIC, PARLIAMENTARY
• POPULATION APPROXIMATELY 1 BILLION (2001)
• POPULATION GROWTH RATE 2.14 PERCENT
• POPULATION DENSITY 324 PERSONS/KM2
• LIFE EXPECTANCY 62 YEARS, MALE 64 YEARS,
  FEMALE
• LITERACY RATE 65.38 PERCENT

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ECONOMIC PROFILE

• GDP AT CURRENT PRICES 400 BILLION (2000-01)
• AVERAGE REAL GDP GROWTH 5.2 PERCENT (2000-01)
• INFLATION RATE MEASURED BY WPI 6.6 PERCENT
  (1999-2000)
• EXCHANGE RATE Rs 45.51 / US (APRIL-JANUARY,
  2001)
• EXPORTS US 44.1 BILLION (2000-2001)
• IMPORTS US 49.8 BILLION (2000-2001)

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Why India?........

• 4th largest economy
• 2nd largest GDP in emerging economies in PPP
  terms
• Projected GDP growth rate for current year is
  about 8
• Stable macro economic indicators
• Abundant foreign exchange reserves of over USD
  100 billion
• Continued strong inflows of FDI of USD 2.3
  billion
• Strong growth rate in exports of 8 in
  April-November 2003 over last year
• BoP Surplus reduction in trade deficit in
  2001-02
• Robust democratic federal system with rule of law
• Growing middle class of over 300 million with
  significant purchasing power
• Widespread use of English and large pool of
  skilled knowledge workers

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The Interim Budget 2004-05

• Significant incentives through duty tariff
  cuts
• Reduction of peak tariff rates by 5, to 20
• Elimination of the 4 special additional customs
  duty
• Reduction of customs duties on equipment for
  projects from 25 to 10
• Inland Air Travel Tax of 15 per cent abolished
• Customs duty on cellphones halved to 5 per cent.
• Customs duty on power equipment cut by 15 per
  cent to 10 per cent.
• Duty on life saving drugs and equipment cut to 5
  per cent.

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Emerging Investment Potentials

• Telecommunications
• Tourism
• Entertainment
• Food Processing
• Pharmaceuticals

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The Telecom Sector

• Highly dynamic industry with growth of 22 pa in
  fixed lines, and over 100 in cellular lines

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The Tourism Industry

• Second highest foreign exchange earner for the
  country.
• Industry given export house status.
• As a GDP (5.6 of GDP), remains a small
  percentage indicating tremendous potential
• Increased government emphasis to make tourism a
  greater revenue earner. Hence
• Foreign tourist arrivals of 2.7 million in 2003
  and grew at 15 over the year before. Growth in
  domestic tourism by 22 per cent
• Foreign exchange earning of USD 3.6 billion- an
  increase of 23 over last year.

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The Tourism Industry
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The Entertainment Industry

• Indian entertainment industry recorded
  exponential growth in last decade to reach a
  turnover of 3.6 billion in 2002. It is expected
  to attain a turnover of USD 9.3 billion by 2007
  growing at a CAGR of 20.

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The Entertainment Industry
Growth in terms of revenue in USD billion
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The Food Processing Industry

• Outside North America two of our largest and
  fastest growing businesses are in India and
  China.
• PepsiCo's annual report, 1999

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The Food Processing Industry

• Industry comprises a gamut of activity including
  agriculture, horticulture, plantation, animal
  husbandry and fisheries.
• The industry is in its nascent stages with only
  2 of food being processed as compared to around
  60 in the US and UK.
• Despite that, this industry
• Is 5th in the country in size, representing 6.3
  of GDP.
• Accounts for 18 of Indias exports and
• 6 of total industrial investment
• The industry size is estimated at USD 70 billion
• Total exports in 2000-01- approximately USD 3
  billion with rice constituting the significant
  share of 20 and marine products of 45

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Drugs and Pharmaceuticals

• 100 FDI permitted
• Drugs have just been further decontrolled,
  boosting the industry
• Joint RD could result in pathbreaking results
• India produces good quality drugs at low prices -
  rich potential for marketing tie-ups

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Indian Pharma Industry

• 4th largest in the world, based on volume
• 8 of worlds production by volume and 1.5 by
  value
• Production Bulk US 860 mn, Dosages US 3 bn.
• Exports US 1.5 billion growing at 15 p.a.
• International Quality 40 of
• exports to developed countries
• Implementation of IPR regime will provide immense
  business opportunities to Global Players

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POTENTIAL OF THE INDIAN PHARMACEUTICAL INDUSTRY
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Investment Potential

• Production of drugs like Penicillin and Ibuprofen
  for leading global companies
• Contract research for European companies. Low
  cost of NDD
• Compliance with international norms- SHE, ISO,
  WHO GMP, USFDA, etc.
• World leader in anti TB drug
• Development of cost effective processes

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OTHER SECTORS

• AGRICULTURE
• - FARMING EQUIPMENT
• - FERTILIZERS
• MANUFACTURING
• - A GROWTH RATE OF 6.3 / YEAR BETWEEN
  1992- 2000
• FINANCIAL SECTOR
• - BANKING
• - INSURANCE

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OTHER SECTORS (Contd.)

• SERVICE SECTOR OTHER THAN INFORMATION
  TECHNOLOGY
• INFRASTRUCTURE
• - POWER GENERATION, TRANSMISSION
• AND DISTRIBUTION
• - RAILWAYS
• - ROADS
• - SHIPPING
• - AIRPARKS
• - PORTS
• OIL AND NATURAL GAS
• MINING

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OTHER SECTORS (Contd.)

• AUTO INDUSTRY
• - AUTOMOBILES FOR DOMESTIC AND
• FOREIGN MARKETS
• - AUTO PART
• BUILDING MATERIAL
• FURNITURE

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OTHER SECTORS (Contd.)

• INDUSTRIAL PRODUCTS
• BIOTECHNOLOGY
• - PHARMACEUTICALS
• - ANIMAL HEALTHCARE
• - AGRICULTURE
• BUSINESS OUTSOURCING
• - CONSULTING TECHNICAL / NON-TECHNICAL
• - RESEARCH
• - ENGINEERING SERVICES
• - TRANSCRIPTS LEGAL, MEDICAL

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OTHER SECTORS (Contd.)

• CALL CENTERS
• HEALTHCARE
• RETAIL
• - DEPARTMENT STORES
• - SPECIALTY STORES
• - CONVENIENCE STORES
• - FRANCHISING

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WHAT IS THE FEDERATION OF INDIAN CHAMBERSOF
COMMERCE INDUSTRY?

• INDIAS APEX BUSINESS ORGANIZATION
• ESTABLISHED IN 1927 AT MAHATMA GANDHIS ADVICE TO
  HELP THE INTERESTS OF INDIAN BUSINESS COMMUNITY
• STARTED WITH 24 MEMBERS
• NOW OVER 500 MEMBERS CONSISTING OF CHAMBERS OF
  COMMERCE, TRADE ASSOCIATIONS AND INDUSTRY BODIES
• SPEAKS ON BEHALF OF OVER 25,000 BUSINESS UNITS
  EMPLOYING OVER 20 MILLION PEOPLE

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WHAT IS THE FEDERATION OF INDIAN CHAMBERSOF
COMMERCE INDUSTRY? (Contd.)

• PROVIDES INPUT TO POLICY ISSUES
• PROVIDES INFORMATION ABOUT INDIAS BUSINESS
• PROVIDES COORDINATION BETWEEN FOREIGN AND INDIAN
  BUSINESSES AND GOVERNMENTS

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• THANK YOU