Business In India | "India Airlines Least in Need May Gain Most From New Owner Rules"

By: Siddharth Philip and Vipin Nair
Source: http://www.businessweek.com
Category: Business In India

India’s decision to allow local airlines sell stakes of as much as 49 percent to overseas carriers may be of most benefit to operators least in need of investment.

SpiceJet Ltd. (SJET), which has said it’s in “no rush” for funds, may be the most appealing target for foreign investors because of the discount carrier’s low debt and record of profitability, said Sharan Lillaney, an Angel Broking Ltd. analyst. Kingfisher Airlines Ltd. may struggle to win investment, even as billionaire Chairman Vijay Mallya seeks new financing, after posting at least five straight annual losses.

“The biggest beneficiary will be SpiceJet as it has lower debt and a decent brand image,” Lillaney said. “Kingfisher needs to restructure its balance sheet and convert debt into equity before it can look at attracting any foreign investment.”

The two carriers and Jet Airways (India) Ltd. rose Sept. 14 on speculation the rule change will help the industry win funds following years of losses caused by price wars, high fuel taxes and a weaker rupee. Prime Minister Manmohan Singh’s government announced the end of the ban along with a similar easing for retailers as its moves to open up Asia’s third-biggest economy.

Kingfisher Debts
Kingfisher (KAIR) has said it is in talks on investment that depend up regulatory changes as it struggles under an 86 billion rupee ($1.5 billion) debt pile. The carrier has also cut two- third of services, grounded planes and halted international flights in a bid to end losses.

“I am skeptical whether Kingfisher is able to attract” foreign investment, said Nikhil Vora, Mumbai-based managing director at IDFC Securities Ltd. “Kingfisher’s significant leverage on its balance sheet makes it a challenging proposition for any buyer.”

The airline, named for liquor tycoon Mallya’s flagship beer, needs an immediate capital infusion of $600 million for a turnaround, according to CAPA - Centre for Aviation. The company’s founders will need to provide at least half of this before talks with a foreign airline could begin, the research company said.

Kingfisher has only an “outside chance” of selling a stake compared with SpiceJet and Go Airlines (India) Ltd., CAPA said in an e-mailed statement. The carrier has a long-term debt to total capital ratio of 162 percent, according to data compiled by Bloomberg. That compares with 76 percent for SpiceJet and 58 percent for Mumbai-based Jet Air.

Kingfisher has plunged 58 percent in the past year in Mumbai trading. SpiceJet has jumped 44 percent and Jet Air has climbed 35 percent. India’s three other main carriers, state- owned Air India, IndiGo and Go Airlines are all closely held.

Kingfisher Re-Engagement
The easing of the investment rules will help Kingfisher re- engage with prospective airline investors “in a more meaningful manner,” Prakash Mirpuri, a spokesman, said in a Sept. 14 text message. The carrier will also move toward re-capitalization and ramp up its operations, he said.

SpiceJet Chief Executive Officer Neil Mills didn’t answer calls to his mobile phone on Sept. 14. GoAir Managing Director Jeh Wadia, IndiGo President Aditya Ghosh and Jet Air Chief Operating Officer Sudheer Raghavan also failed to answer calls the same day.

Kingfisher posted a 6.5 billion rupee loss in the quarter ended June, compared with 2.6 billion rupees a year earlier. SpiceJet and Jet Air both posted profits in the period.

Non-airline investors from overseas were allowed to hold as much as 49 percent in local carriers before the rule change.

Gulf Airlines
Middle East airlines may be the most likely to buy into Indian carriers because of their geographical proximity, existing service connections and state backing.

Qatar Airways Ltd. Chief Executive Akbar Al Baker said in April that that anyone who didn’t want to invest in China or India “must be crazy.”

The country’s annual passenger numbers may surge to 180 million by 2020 from 61 million last year as rising wealth makes travel affordable to more people, according to a government forecast. Qatar Air declined to comment by e-mail yesterday.

Abu Dhabi-based Etihad Airways PJSC said yesterday equity investments are an “important evolution of its successful partnership strategy.” The carrier already has stakes in Virgin Australia Holdings Ltd., Air Seychelles Ltd. and Air Berlin Plc.

“The Indian aviation industry offers tremendous potential, with significant passenger movement on domestic and international sectors,” it said without commenting on whether it wanted to buy into a local carrier. The airline will add flights to a ninth Indian city, Ahmedabad, in November, it said.

Source: http://www.businessweek.com/news/2012-09-16/india-airlines-least-in-need-may-gain-most-from-new-owner-rules

Foreign Investment In India | "Policy on Foreign Investment in Power Trading Exchanges"

By: Invest In India
Source: http://investinindia.com
Category: Foreign Investment In India

The Cabinet Committee on Economic Affairs has approved the proposal of the Department of Industrial Policy & Promotion for permitting foreign investment up to 49 percent, in Power Trading Exchanges.

The CCEA has decided to permit foreign investment, up to 49 percent (FDI & FII) [FDI limit of 26 per cent and FII limit of 23 per cent of the paid-up capital], in Power Trading Exchanges, in compliance with SEBI Regulations; Central Electricity Regulatory Commission (Power Market) Regulations, 2010; and other applicable laws/ regulations; security and other conditionalities. FII investments would be permitted under the automatic route and FDI would be permitted under the government approval route. This is subject to the conditions that FII purchases shall be restricted to secondary market only, and no non-resident investor/ entity, including persons acting in concert, holding more than 5 percent of the equity in these companies.

The approval is expected to strengthen the power trading exchanges and to enhance the availability of power, as well as improve its distribution for inclusive development. Introduction of global best practices, concomitant with the induction of FDI, is expected to lead to higher service standards in power trading exchanges.

As per extant policy, FDI, up to 100 percent, under the automatic route, is permitted in the power sector (except atomic energy). This includes generation, transmission and distribution of electricity as well as power trading, subject to the provisions of the Electricity Act, 2003. There is, however, no specific dispensation, under FDI policy, for power trading exchanges. The extant FDI policy permits foreign investment, up to 49 percent (FDI & FII) [FDI limit of 26 per cent and an FII limit of 23 per cent of the paid-up capital], in infrastructure companies in securities markets, namely, stock exchanges, depositories and clearing corporations, in compliance with SEBI Regulations. While FII investment is on the automatic route, FDI is allowed under the government approval route. Foreign investment in commodity exchanges is also allowed on the same lines.

Power trading is the purchase of electricity for resale thereof, while a power trading exchange provides an organized platform for fair, neutral, efficient and robust price discovery; extensive and quick price dissemination; and price risk management for the generators, distributors, traders, consumers and other stakeholders in the power sector. Power trading exchanges are transparent electronic platforms which help promote competition in power markets. They are in a nascent stage of development in India. In view of the functions they perform, as also their utility in the transfer of power from surplus to deficit areas, these exchanges need to be promoted, through greater investment and induction of global best practices, modern management skills and latest technology. Hence, there was a felt need to allow foreign investment into these exchanges.

Source: http://investinindia.com/news/policy-foreign-investment-power-trading-exchanges-12c3

Investment In India | "President calls for more investment to ensure health facilities in India"

By: Online Indian News
Source: http://www.onlineindiannews.com
Category: Investment In India

Prez Pranab Mukherjee has called for more investment from public and private sector to ensure better health facilities. Inaugurating a private hospital in Howrah district of West Bengal, Mr. Mukherjee said that substantial amount have been allocated in education and health sector in 11th and 12th five year plan besides different government initiatives for health care... Prez Pranab Mukherjee has called for more investment from public and private sector to ensure better health facilities. Inaugurating a private hospital in Howrah district of West Bengal, Mr. Mukherjee said that substantial amount have been allocated in education and health sector in 11th and 12th five year plan besides different government initiatives for health care.(air)

Source: http://www.onlineindiannews.com/content/view/2370/36/

Business In India | "Will Boeing's 787 Dreamliner turn Air India's business around?"

By: THE ECONOMICS TIMES
Source: http://economictimes.indiatimes.com
Category: Business In India

New hope is in the air for Air India. No, it's not related to government permission for foreign carriers to invest in domestic airlines that came on Friday. Airline FDI is expected to benefit private carriers with far lesser financial problems than the nation al carrier.

Air India's hope is about 186-foot long, boasts a top speed of up to 560 miles an hour and flies at least 9,440 miles (New York to Hong Kong) non-stop tanked up. It is a plane alright, but because of its ostentatious title, Dreamliner, and unique futuristic features, it would be easy to overlook that bit.

The 787-series Dreamliner is billed as a plane like no other, but in this part of the globe, it acquires a greater aura. Air India is the fifth airline to snap up the 787. But no other airline has entwined its future to a plane as the government-run carrier has with the Dreamliner.

When it embarks on its maiden flight on September 19 from Delhi to Chennai, the 787 will be carrying a load of expectations that would outweigh all the 256 passengers it can accommodate.

"We hope that the Dreamliner will take Air India back to its good old Maharaja (mascot) days," aviation minister Ajit Singh said when the first of the 27 planes the carrier has ordered landed on Wednesday.

Plane Truths Singh's excitement is understandable. The 787-series Dreamliner is the first mid-size airplane that can fly long routes, enabling airlines to tap non-stop routes, according to Boeing. Translation: passengers can avoid the pain of an airport transit.

Source: http://economictimes.indiatimes.com/news/news-by-industry/transportation/airlines-/-aviation/will-boeings-787-dreamliner-turn-air-indias-business-around/articleshow/16411872.cms

Foreign Investment In India | "India to allow foreign investment in retail, aviation"

By: Associated Press
Source: http://photoblog.nbcnews.com
Category: Foreign Investment In India

The government's surprise announcement Friday that it will allow foreign investment in retail and aviation and the sale of minority stakes in four state-run companies evoked sharp criticism from opposition parties and some of the ruling Congress party's coalition allies. A day earlier, the government announced a hike in the price of diesel fuel.
Hundreds of supporters of the Hindu nationalist Bharatiya Janata Party held a rally in New Delhi demanding that the government reverse its decisions, saying they would hurt the poor.

Source: http://photoblog.nbcnews.com/_news/2012/09/15/13886134-india-to-allow-foreign-investment-in-retail-aviation?lite

Investment In India | "ITC to speed up Rs 25,000-cr investment plan"

By: OUR BUREAU
Source: http://www.thehindubusinessline.com
Category: Investment In India

CHENNAI, SEPT. 15:
ITC Ltd is all set to expedite its Rs 25,000-crore investment plan, “as we consider this as the right time to invest in the Indian economy,” said Y. C. Deveshwar, Chairman of the conglomerate. He said this would enable Brand ITC to emerge stronger. “In the current global economic scenario, India needs strong brands to hold its own; and nothing is given, we have to earn,” he said.

Besides, this investment over five years will also generate more employment opportunities, leading to the country’s overall economic prosperity, he said.

Addressing the media here at the launch ceremony of the company’s new luxury property, ITC Grand Chola, he said ITC is prepared to invest even more should the need arise, as there would be no dearth of funds or lack of expertise. “However, the major challenge is formalities; statutory clearances take a lot of time,” he said.

40 PROJECTS IN PIPELINE

According to him, a chunk of the investment — over Rs 10,000 crore — has been earmarked to expand its hotels division. It has 40 hotel projects in the pipeline. Besides, it is planning one in Sri Lanka.

“Nepal and Bangladesh are also on our radar, though our first priority is to consolidate our position in India,” he said.

The remaining Rs 15,000 crore will be invested across verticals including food, lifestyle retailing, personal-care products, and packaging to agri commodities, paperboards and stationery.

For example, he said for the foods division, the company plans to set up manufacturing facilities closer to markets.

Near Chennai, it plans a logistics hub and a manufacturing unit on 40 acres.

Source: http://www.thehindubusinessline.com/companies/article3901546.ece

Foreign Investment In India | "Govt okays 8 foreign pharma investments"

By: Agencies/New Delhi
Source: http://www.gulf-times.com
Category: Foreign Investment In India

India has approved eight foreign investments in drugmakers worth $333mn in total, signalling the finance ministry may be winning a battle to open up the country’s fast-growing markets and giving a boost to global drugmakers hungry for growth.
As a condition of its approval, however, the government said the foreign companies including US-based Pfizer and Germany’s B-Braun would have to continue producing cheap drugs and maintain spending in ongoing research and development projects run by their Indian partners for five years.
Since becoming finance minister last month, P Chidambaram has directed officials to fast-track foreign direct investments (FDI) as part of a drive to revive investor confidence after India’s economy grew at its slowest pace in nearly three years.
Proposals had been delayed for months due to a lack of clarity over government policy, with some government bodies expressing concerns that medicine prices might rise after a few Indian drugmakers sold businesses to overseas rivals.
In all, Chidambaram approved 21 foreign direct investment proposals totalling Rs24.1bn ($433.5mn) on the recommendation of the Foreign Investment Promotion Board (FIPB).
The proposals were cleared after the government decided to allow up to 49% foreign direct investment in domestic companies with conditions, two government sources said.
The present rules allow 100% foreign investment for new companies being set up in India while overseas investment in existing companies needs FIPB approval.
The government did not give details of the investments.
A McKinsey report earlier this year projected India’s pharmaceutical market would triple to $20bn by 2015 and move into the world’s top-10 pharmaceutical markets.
“The absolute growth of $14bn will be next to the growth potential of the US and China, and in the same league as the growth in Japan, Canada and the UK,” it said.
Abbott Laboratories bought Mumbai-based Piramal Healthcare’s Indian business for $3.72bn in 2010 while Ranbaxy founders sold a controlling stake in the company to Japan’s Daiichi Sankyo Company for $4.2bn in 2008.
Global drugmakers such as Pfizer, GlaxoSmithKline and Sanofi also have a significant presence in the country and are looking to expand their businesses there.
Abbott has the largest market share followed by India’s Cipla and GlaxoSmithKline.
Meanwhile, news reports said yesterday that the government is to propose watered down legislation later this month to open up the retail sector to foreign supermarkets.
The Mail Today tabloid and Hindustan Times reported that the government would propose allowing groups such as US giant Wal-Mart or French multinational Carrefour to own up to 49% of local subsidiaries.
The legislation would also include provisions for state governments to set local conditions for the groups, a move designed to head off opposition to the highly controversial legislation.
Last December, the government, which has struggled to pass reforms, was forced to withdraw a proposal to allow foreign supermarkets to own up to 51% of their local subsidiaries.
Shopkeepers, opposition parties and even the Trinamool Congress, ally of the Congress-led United Progressive Alliance coalition came together to oppose the change in the law, saying it would destroy the livelihoods of small business owners.
The government sees foreign supermarkets as a way to improve the food supply chain and bring down prices, but the proposed legislation as reported yesterday might not be enough to attract them.
Allowing state governments to set conditions locally would increase the complexity of the regulatory environment and the 49% ownership cap would mean the groups would not have control over their Indian operations.
Any proposed legislation would also need to pass the parliament, which was disrupted almost every day of the last session which ended last Friday.
Foreign retail groups are already allowed in India, but they must run single-brand shops.

Source: http://www.gulf-times.com/site/topics/article.asp?cu_no=2&item_no=530707&version=1&template_id=40&parent_id=22

Investment In India | "Coal India to invest Rs.40,000 crore in 12th Plan"

By: IANS
Source: http://india.nydailynews.com
Category: Investment In India

New Delhi, Sep 12 — State miner Coal India Ltd (CIL) said Wednesday the company was committed to investing Rs.40,000 crore in the 12th Plan period (2012-17).
"Capital investment plan for the current and next 5 year plan was discussed. We have a plan for our Rs.25,400 crore (investment) for the current five year plan, plus another Rs.14,500 crore if certain conditions are made. So that takes us to Rs.40,000 crore total," CIL chairman S. Narsingh Rao said after a coal ministry review meeting of the company, chaired by Coal Minister Sriprakash Jaiswal.
According to Rao, capital expenditure over the next Plan period is to be mainly on developing more than 100 underground and opencast mines in seven coal producing subsidiaries.
CIL, which accounts for over 80 per cent of the domestic coal production, also plans to set up 22 new washeries. It is also planning acquisition of assets abroad.
Rao said apart from this, CIL is planning a conditional investment of Rs 14,500 crore on augmenting rail infrastructure.
"We plan to spend Rs.7,500 crore on rail infrastructure provided the Railways complete the project on time. We intend to spend another Rs.7,000 crore on rail projects for faster transportation of coal if all goes well,"
Earlier, the Coal India chairman along with heads of nine other public sector companies in the infrastructure sector met Finance Minister P Chidambaram and committed to stepping up investments.
Rao said CIL was making all attempts to boost production and was hopeful of meeting the production target of 464 million tonnes for the current fiscal.

Source: http://india.nydailynews.com/business/502bf965d4f8e0c6a325674b410e5a8f/coal-india-to-invest-rs-40-000-crore-in-12th-plan

Business In India | "‘India-Asean business fair to promote tie-ups’"

By: TNN
Source: http://timesofindia.indiatimes.com
Category:  Business In India

JAIPUR: The second India-ASEAN Business Fair (IABF) & Business Conclave slated from December 18 to 20 in New Delhi will give a fillip to business in the country, said Rajendra Bhanawat, managing firector of RIICO. Bhanawat was speaking as guest of honour at the road show for IABF organized in the city by the Federation of Indian Chambers of Commerce & Industry ( FICCI).

Bhanawat said it was heartening that just in its second year, the IABF was getting international participation from Asian countries like Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam. He further said the fair will throw up avenues for enhancing trade and investments across sectors. It would serve as a platform for exploring innovative approaches to promote trade, investment, joint ventures and strategic market tie-ups, Bhanawat added.

Speaking on the occasion, honorary secretary general of Rajasthan Chamber of Commerce and Industry, K L Jain said this business to business forum, with scheduled meetings, is being organized on the sidelines of India-ASEAN Commemorative Summit 2012.

Source: http://timesofindia.indiatimes.com/city/jaipur/India-Asean-business-fair-to-promote-tie-ups/articleshow/16376649.cms

Business In India | "India pledges support to Palestine, announces USD 10 mlln"

By: Press Trust of India
Source: http://www.business-standard.com
Category: Business In India

India today announced a USD 10 million contribution to Palestine and pledged its support to Palestine's bid for full and equal membership of the UN.

Prime Minister Manmohan Singh and Palestinian National Authority President Mahmoud Abbas held comprehensive talks on host of bilateral issues and exchanged views on regional developments, particularly the developments in the West Asia and the Gulf region.

Three pacts, including one in the field of Information Technology, were also inked after the talks. "Support for the Palestinian cause has been a cornerstone of India's foreign policy. I reiterated India's firm support for the struggle of the Palestinian people to achieve a sovereign, independent, viable and united state of Palestine with East Jerusalem as its capital," Singh said at a joint- press event with Abbas.
The Prime Minister said India supported an independent Palestine living within secure and recognised borders, side-by-side and at peace with Israel. He also announced that India will "contribute USD 10 million to Palestine's budget for this year to help address its financial requirements."

Singh noted that India had played an active role in supporting the efforts of the State of Palestine to secure full membership status at UNESCO. "We will continue to support Palestine's bid for full and equal membership of the UN.

"We also look forward to early resumption of peace talks between the Palestinians and Israelis leading to a comprehensive resolution between the two sides," he said.

Singh's remark comes in the backdrop of the US making it clear that it will veto the Palestine bid for a non-member status in the United Nations later this month. At present, Palestinians only enjoy observer status.

"We continue to make clear that we believe that the only realistic path for the Palestinians to achieve statehood is through direct negotiations," the Prime Minister said.

Source: http://www.business-standard.com/generalnews/news/india-pledges-support-to-palestine-announces-usd-10-mlln/55020/

Foreign Investment In India | "Foreign Investors Buy Net 7.3 Billion Rupees of Indian Stocks"

By: Paresh Jatakia
Source: http://www.businessweek.com
Category: Foreign Investment In India

Overseas investors bought a net 7.3 billion rupees of Indian stocks yesterday, raising their investment in the equities this year to 644.1 billion rupees, or $12.5 billion, according to the nation’s market regulator.

Foreigners bought 20.3 billion rupees of shares and sold 13 billion rupees, the Securities & Exchange Board of India said on its website today. They sold a net 1.62 billion rupees of bonds, reducing their inflow into debt this year to 229.9 billion rupees, the data show.

The benchmark BSE India Sensitive Index (SENSEX) has increased 15 percent this year, helped by the biggest overseas equity flows among 10 Asian markets tracked by Bloomberg. Flows surged to a record in 2010, making the Sensex the best performer among the world’s top 10 markets. The largest-ever outflow in 2008 led the biggest annual slump of 52 percent.

Foreigners have invested 5.088 trillion rupees in stocks and 1.437 trillion rupees in bonds since they were allowed into the country in 1993.

The regulator provides data on shares bought and sold by large investors, including trades in the primary and secondary markets, with a delay of at least a day.

Source: http://www.businessweek.com/news/2012-09-11/foreign-investors-buy-net-7-dot-3-billion-rupees-of-indian-stocks

Investment In India | "UPDATE 1-India approves eight foreign pharma investments"

By: Manoj Kumar and Kaustubh Kulkarni
Source: http://in.reuters.com
Category: Investment In India

NEW DELHI, Sept 11 (Reuters) - India has approved eight foreign investments in drugmakers worth $333 million in total, signalling the finance ministry may be winning a battle to open up the country's fast-growing markets and giving a boost to global drugmakers hungry for growth.

As a condition of its approval, however, the government said the foreign companies including U.S.-based Pfizer and Germany's B-Braun would have to continue producing cheap drugs and maintain spending in ongoing research and development projects run by their Indian partners for five years.

Since becoming finance minister last month, P. Chidambaram has directed officials to fast-track foreign direct investments (FDI) as part of a drive to revive investor confidence after India's economy grew at its slowest pace in nearly three years.

Proposals had been delayed for months due to a lack of clarity over government policy, with some government bodies expressing concerns that medicine prices might rise after a few Indian drugmakers sold businesses to overseas rivals.

In all, Chidambaram approved 21 foreign direct investment proposals totalling 24.1 billion rupees ($433.5 million) on the recommendation of the Foreign Investment Promotion Board (FIPB).

The proposals were cleared after the government decided to allow up to 49 percent foreign direct investment in domestic companies with conditions, two government sources said.

The present rules allow 100 percent foreign investment for new companies being set up in India while overseas investment in existing companies needs FIPB approval.

The government did not give details of the investments.

A McKinsey report earlier this year projected India's pharmaceutical market would triple to $20 billion by 2015 and move into the world's top-10 pharmaceutical markets.

"The absolute growth of $14 billion will be next to the growth potential of the U.S. and China, and in the same league as the growth in Japan, Canada and the UK," it said.

Abbott Laboratories bought Mumbai-based Piramal Healthcare's Indian business for $3.72 billion in 2010 while Ranbaxy founders sold a controlling stake in the company to Japan's Daiichi Sankyo Co for $4.2 billion in 2008.

Global drugmakers such as Pfizer, GlaxoSmithKline, Sanofi also have a significant presence in the country and are looking to expand their businesses there.

Abbott has the largest market share followed by India's Cipla and GlaxoSmithKline.

Source: http://in.reuters.com/article/2012/09/11/india-fdi-idINL3E8KB4E520120911

Foreign Investment In India | "Foreign Car Makers to Enter Pre-owned Car Business in India"

By: Xinhuas
Source: http://english.cri.cn
Category: Foreign Investment In India

Many foreign car manufacturers are entering into pre-owned car business in India as the used car segment is huge and lucrative with many middle class families who cannot afford new cars now prefer to buy second hand cars.

In a bid to shed its premium tag and shore up volumes, Czech car maker Skoda is working at entering the pre-owned car business in India by the end of the year.

The move comes on the back of increasing attempts by car companies to expand volumes in a sluggish market by initiating new customers into their brands through pre-owned vehicles and retaining older ones through loyalty programs.

Sudhir Rao, managing director, Skoda India, said, "We are working on putting in place a comprehensive growth strategy to penetrate deeper into the country with our range of products. We will not trigger discount wars to boost numbers but we are working on entering the pre-owned cars business to introduce more customers to our brand by the end of the year."

While the specifics of the used-car business are still being worked out, Skoda is ramping up efforts to expand overall reach by setting up 150 dealerships by 2014-15. The company has 102 outlets in India at present.

Though the Indian subsidiary at present contributes a little over three percent to Skoda's sales globally, Rao said the company was infusing 3 billion rupees (54.5 million U.S. dollars) to increase the local contents in its products and reduce cost of ownership to raise volumes "substantially" in the country and to achieve sales tally of 1.5 million units worldwide by 2018.

Automobile manufacturers are increasingly focusing on sales of pre-owned vehicles to expand volumes in a market where off-take of new vehicles have waned due to high interest rates, increased fuel costs, and uncertain economic conditions.

An automobile industry expert in India said the "pre-owned car business units not only provide dealers with opportunities to improve margin by selling used cars, they can also increase their sales of new vehicles through exchange programs."

For the quarter ended June 30, Maruti Suzuki expanded volumes by 18 percent to 60,467 units in sales made under exchange programs despite its sluggish performance in the domestic market.

"In urban areas where demand has fallen sharply, we are trying to push sales through our loyalty programs. Around 1.5 million customers service their vehicles every month, 10 percent of whom own vehicles which are more than 10 years old. We identify these consumers and offer them loyalty bonus to exchange their cars for new ones," said a senior executive at Maruti Suzuki.

Additionally, the company registers sales of pre-owned cars. The used car market in India stands at 2.7 million units but over 85 percent of it is currently controlled by players in the unorganized sector.

The convenience and warranty being offered by companies like Maruti Suzuki, Hyundai Motor India, Mahindra and Mahindra and Ford India are increasingly making consumers opt for purchase and sale of pre-owned vehicles through the organized route.

The Maruti Suzuki executive pointed out that around 30 percent of car buyers exchange old vehicles for new ones.

In the last financial year, Maruti Suzuki sold as many as 240, 000 pre-owned cars which is nearly a quarter of its overall sales of new vehicles. Hyundai Motor retailed pre-owned vehicles amounting to 15 to 16 percent of its sales in the domestic market through Hyundai Advantage outlets last year.

Source: http://english.cri.cn/6826/2012/09/10/3241s721601.htm

Foreign Investment In India | "Govt looking at riders for foreign investment in pharma"

By: NEW DELHI
Source: http://www.thehindubusinessline.com
Category: Foreign Investment In India

Foreign pharmaceutical companies looking to acquire Indian drugs businesses are likely to face tougher conditions as the Health Ministry is working on new rules to ensure the availability of medicines at affordable prices in the local market, a senior official said on Monday.

The Ministry has suggested that after acquisitions, companies should at least over the next five years keep manufacturing certain life-saving medicines in India at the highest level of production they have recorded in the previous three years, Arun K. Panda, Joint Secretary at the Ministry For Health and Family Welfare, told Dow Jones Newswires.

Also, acquired companies would have to maintain research and development spending for a similar period on drugs that are relevant to the Indian market, Panda said.

There has recently been a lot of confusion over India’s approach to foreign investment in the pharmaceuticals sector. The country is seen to be moving away from the liberal regime put in place in 2002 that allowed 100 per cent foreign investment without Government review.

CROSS-BORDER DEALS

In recent months, the Government has started reviewing all cross-border deals and is considering forcing companies that acquire Indian assets to meet certain conditions to satisfy health activists and others who fear giving greater control of the local market will allow foreign companies to increase the prices of generic drugs or push the sales of costlier branded products.

Some multinational companies operating here are unhappy with tough decisions in recent years by the patent office and Indian courts in rejecting drug patents recognised in many Western nations.

The Government decided to revisit its investment policy for the pharmaceuticals sector last November after a spate of foreign takeovers of Indian companies in recent years.

The significant deals were Japan-based Daiichi Sankyo Co.’s purchase of a majority stake in Ranbaxy Laboratories Ltd in 2008 and US-based Abbott Laboratories’ acquisition of the local generic-drugs business of Piramal Healthcare Ltd in 2010.

Keywords: Foreign pharmaceutical companies, acquisitions, medicine prices, life-saving medicines, foreign investments, multinational companies, patent rows,

Source: http://www.thehindubusinessline.com/industry-and-economy/economy/article3882391.ece?homepage=true&ref=wl_home

Investment In India | "Punjab most favoured for investment in India, says World Bank study"

By: PNS | CHANDIGARH
Source: http://www.dailypioneer.com
Category: Investment In India

A recent World Bank study has favoured Punjab as the “most preferred destination” for investors in the country. The study has, in fact, termed the State as “future growth engine that would propel the nation’s economic growth”.

“In a latest study of World Bank about the Investment environment in the country, Punjab has been declared as the most preferred destination for investors,” said Punjab Industries Minister Anil Joshi.

He said that the World Bank report was based on various parameters including record investment by the incumbent government on the infrastructure such as roads, air and rail connectivity and incentives announced by the Punjab Government.

He said that Punjab Government has set an investment target of Rs one lakh crore in the state and to meet this, he has already held series of meeting with big industrialists at New Delhi.

Besides, World Bank study specially talked about the Integrated Check post at Attari CP and Rs 213,00 crore project Guru Gobind Singh Refinery at Bathinda, that would change the face of Industry in the State.

In past, investors were facing shortage of electricity, which is going to become the strength of the state as in next one year all three Thermal Plants would become operational, Joshi claimed.

He said that the Integrated Check Post at the Wagah border would be a boon for trade in Punjab as it was a natural trade route to Central Asia for centuries.

Joshi said that keeping in view the interests of traders, Union Government should enhance the number of items to be exported via ICP from 137 to 6,000 as in Mumbai port.

“Due to the efforts of the SAD-BJP government, many world class industrial houses like Videocon has announced to invest in Punjab,” he said adding that to facilitate the investors, Government has sanctioned establishment of Land Bank, so that the land required for industry could be provided to investors in a hassle-free manner.

Source: http://www.dailypioneer.com/state-editions/chandigarh/93545-punjab-most-favoured-for-investment-in-india-says-world-bank-study.html