Commandant's note

The Jammu and Kashmir Light Infantry is a unique Regiment of Indian Army.  It is the only infantry regiment born out of `patriotic volunteers’ of Jammu and Kashmir which rose to fight against Pakistani raiders in October 1947 on a clarion call given by Shiekh Mohammed Abdullah. The volunteers held the Pakistani raiders at bay until arrival of Indian Army on October 27, 1947,after which they fought with them shoulder to shoulder till the attackers were ousted.

In recognition of their valour they were organized as the 'J&K Militia’, the first force to be raised after Independence. Since then the J&K Militia has participated in all operations with valour and courage.

In recognition of their bravery, 7 and 14 J&K Militia were converted into `Ladakh Scouts’ after 1962 war and merged with Indian Army. Rest of the force too was converted into regular army in 1972 after they performed exceptionally well in the 1965 and 1971 wars.

This regiment is a true symbol of national integration and secularism.  For the first time in 1948, it introduced the concept of `MMG’ (Mandir, Masjid and Gurdwara under one roof), which was later adopted by rest of the Indian Army as `sarv dharm sthal’.

The regiment has been conferred four Battle Honours, of which three were earned while it was a para-military force. No other para-military force has earned any battle/theatre honour in our country. The fourth one was earned during Kargil War. JAK LI has earned the distinction of becoming the only Param Vir Chakra winner of the Siachen Glacier.

Inspite of being the youngest regiment of Indian Army, it is one of the highest decorated. They include one Param Vir Chakra, two Ashoka Chakra, 11 Mahavir Chakra and 21 Unit Citations/Appreciation, amongst  others  awards.

Unbeknownst to the world outside, the regiment has rendered yeomen  service in containing militancy by motivating youth and providing them respectable and secure jobs in large numbers every year, especially at the height of militancy.

JAK LI’s Regimental Training Centre is located at Srinagar in the most picturesque environment. The regiment has won accolades when assigned jobs overseas, including in Sri Lanka and various UN Peacekeeping missions.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman

ExecutiveMBA

From Neecha Nagar to Miss Lovely

Indian cinema’s association with the Cannes Film Festival goes back a long way. As the world’s largest film producing nation inches its way back into the reckoning on the Croisette, here is a historical overview of what has gone before

India’s association with the Cannes Film Festival goes back all the way to its first edition in 1946. That year, Chetan Anand’s Neecha Nagar, loosely adapted from Maxim Gorky’s The Lower Depths, won the Grand Prix along with ten other titles. Eleven films were given the top prize because Cannes was seeking to make up for the hiatus of the War years.

Legend has it that the Cannes event was originally supposed to kick off in 1939 because the Venice Film Festival awards were “rigged” – Jean Renoir’s superb Grand Illusion was passed over for two utterly undeserving films – one made by Goebbels’ propaganda ministry, the other by Benito Mussolini’s son. Politics has remained a constant factor for Cannes ever since.
 
In 1946, Neecha Nagar was in great company. Among the films that were awarded in Cannes’ inaugural edition were David Lean’s Brief Encounter, Billy Wilder’s The Lost Weekend and Roberto Rossellini’s Rome Open City.

Until the mid 1990s, India was a constant presence on the Croisette and several films from the country competed for top honours at the festival. Then, the world’s largest film producing nation dropped off Cannes’ radar. It rankled because Cannes has always mattered. 

As the multi-talented French creator Jean Cocteau once said, “The Festival is an apolitical no-man’s land, a microcosm of what the world would be like if people could contact each other directly and speak the same language.” At the festival, everybody does indeed speak the same language – the language of cinema. For 11 days, Cannes turns into the movie capital of the world and no nation that fancies itself as a force on the global stage can afford to miss out on the action.

Since the curtains went up on the festival – the first Palme d’Or (Golden Palm) was handed out to Delbert Mann's Marty in 1955 – Cannes has recognised the best filmmakers of the world with its trophy.

Run your eyes through the list of filmmakers that have won the Grand Prix/Palme d’Or over the years: Roberto Rossellini, Vittorio de Sica, Orson Welles, Federico Fellini, Luis Bunuel, Luchino Visconti, , Michelangelo Antonioni, Lindsay Anderson, Robert Altman, Joseph Losey,  Martin Scorsese, Ermanno Olmi, Volker Schlondorff, Akira Kurosawa, Andrzej Wajda, Constantin Costa-Gavras, Wim Wenders, Shohei Imamura, Francis Ford Coppola, Steven Soderbergh, Mike Leigh, Abbas Kiorastami, Emir Kusturica, Chen Kaige, Coen brothers,  Taviani brothers, Quentin Tarantino, Lars von Trier, Michael Haneke…

This list is by no means complete, but it’s a veritable who’s who of the men who have shaped the contours of modern cinema. Unfortunately, only a solitary woman director – Jane Campion for The Piano, 1993 – has ever won the Palme d’Or and that is one imbalance that the Cannes Film Festival would be keen to rectify.     

What separates Cannes from other festivals is its constant edginess. Even as it celebrates Hollywood glitz and glamour, it revels as much in showcasing the auteurs and the in-your-face upstarts, and in spotting and pushing new talents from around the world. You love some of the films, you hate others, but you can rarely ever completely ignore anything that the Cannes selectors pick.

The last Indian film to compete in Cannes was Shaji N. Karun’s Swaham in 1994. Another Malayalam film, Murali Nair’s Arimpara, made the Un Certain Regard cut in 2003, a year after Bhansali’s reworking of Devdas had a special red carpet screening at the Grand Lumiere.

But India was blanked out year after year by the globe’s premier film festival until it made a comeback with Vikramaditya Motwane’s Udaan breaking into  Un Certain Regard in 2010. Yet, Indian filmmakers, big and small, land in Cannes’ buyer-seller space with movies in a bid to access the growing Diaspora as well as tap new markets. .

But for those saddened by the dwindling global esteem for the quality of Indian films, it is a tad painful to see relatively small filmmaking nations that were once way behind India in terms of international exposure - South Korea, China, Iran, Thailand, Taiwan – being ‘officially’ celebrated in Cannes every year.

 In 1954, Bimal Roy’s Do Bigha Zameen bagged a Grand Prize, while Ray’s epochal Pather Panchali was adjudged the Best Human Document in 1956. As many as 17 Indian films were in Competition during the first two decades of Cannes. Besides Pather Panchali, these included Ray’s Paras Pathar and Devi, Bimal Roy’s Do Bigha Zameen, Biraj Bahu and Sujata, V. Shantaram’s Amar Bhoopali and Shevgyachya Shenga, Prakash Arora’s Boot Polish (for which Baby Naaz won a Special Mention in 1955), and Moni Bhattacharjee’s Mujhe Jeeno Do.


In the 1970s and 1980s, too, Indian cinema figured frequently in the Cannes Competition with films like Mrinal Sen’s Ek Din Pratidin (1980), the Jury Prize-winning Kharij (1983) and Genesis (1986), MS Sathyu’s Garam Hawa (1974), Shyam Benegal’s Nishant (1976), Ray’s Ghare Baire (1984).

Two Indian films came tantalizingly close to winning Cannes’ top prize. One, of course, was Pather Panchali, which is today listed on the festival’s official website at par with the 1956 Palme d’Or winner, the French documentary Le Monde du Silence (The Silent World), made by legendary oceanographer Jacques-Yves Cousteau and Louis Malle. It was felt the French film pipped Ray’s debut work for of its technical brilliance – it was one of the first films that used underwater cinematography to capture the depths of the ocean in colour.


The other was Mrinal Sen’s searing critique of urban middle class mores, Kharij, which, in 1983, was up against a film of the quality of Shohei Imamura’s The Ballad of Narayama. While the latter was given the Palme d’Or, the jury, headed by American writer William Styron, adjudged Kharij the second best by bestowing the Jury Prize on it. In 1983, Cannes had a particularly strong Competition line-up and the runners-up finish for Kharij was no mean achievement. Among the films that Sen’s entry upstaged were Robert Bresson’s L’Argent and Andrei Tarkovsky’s Nostalgia.

In the late 1980s, two Indian films did the nation proud – Mira Nair’s Salaam Bombay won the Camera d’Or (for the best debut film screened in the festival across all its sections) in 1988 and Shaji’s Piravi bagged the best film prize in Un Certain Regard in 1989. In 1999, Murali Nair’s Marana Simhasanam, screened in Un Certain Regard, won the Camera d’Or.  
   
But the last two decades have seen a complete washout, with no Indian name making it to the list of 20-odd films that compete each year for the Palme d’Or although a special screening of a documentary celebrating the popular strain of Hindi cinema, Rakesysh Omprakash Mehra’s Bollywood – The Greatest Love Story Ever Told, was hosted by the festival in 2011.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman

ExecutiveMBA

PAUL BRACKEN: PROFESSOR OF MANAGEMENT AND POLITICAL SCIENCE, YALE UNIVERSITY

China, too, is shifting its nuclear forces to mobile missiles and submarines. These weapons can be put on alert in a way that would be highly visible to US satellites and the global media. Thus, the Chinese can easily “nuclearise” a crisis with US or anyone else. They do not have to detonate a nuclear weapon, but only alert adversaries to the dramatic increase in the political stakes and dangers of a showdown.

Russia, not wanting to be left out of the act, has recently staged the largest nuclear exercises in decades to remind everyone that it remains a serious nuclear player, too. These individual developments are troubling. But they cannot be understood in isolation from the larger multipolar system of major powers that is forming. To a great extent, this is a nuclear multipolar system: possessing nuclear weapons contributes to a country’s global status as a major power.

To see this, consider the following question: When was the last time that the US or anyone else seriously proposed that India sign the Nuclear Non-Proliferation Treaty (NPT) – that is, that India give up the Bomb. Given America’s economic problems and looming defense cuts, as well as growing Chinese power, there is no longer even a remote possibility that this demand will be made. India has become an accepted, legitimate member of the nuclear club, the fiction of the NPT notwithstanding. It is even less likely that China or Russia would disarm for the sake of a nuclear-free world.

But the most urgent problem stems from the breakdown of major countries’ one-time nuclear monopoly and the empowerment of smaller countries like North Korea, Pakistan, Israel, and, quite possibly, Iran. A new set of rules for diplomacy, military strategy, and arms control is needed to stabilize this emerging nuclear order. Pretending that it does not exist is not a strategy.

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

 

For More IIPM Info, Visit below mentioned IIPM articles

 

IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman

ExecutiveMBA

Can India rise to the challen ge of its solar potenti al?

India’s National Solar Mission is helping create conditions for the rapid scale-up of solar capacity and technological innovation. But although it appears to be going great guns in some states like Rajasthan and Gujarat, it will need greater push and deployment across the country in order to meet its overall objective.

An hour’s drive from Amritsar, the border city between India and Pakistan, lies the small village of Awan. At first glance there is nothing that makes this village any different from the others in Punjab. But walk a little farther from the village and you come across the imposing gates of Azure Power Pvt. Ltd. This sprawling solar power plant is spread over almost 15 acres and its hundreds of installed solar panels feed the electricity needs of more than 20 neighbouring villages around. The plant produces 2 megawatts of electricity, which gets fed straightaway to the local grid and is then distributed to the villages all around. The chunk of land on which the plant sits has lost its fertility and has been obtained on a 20-year lease from the village panchayat. Besides paying the panchayat a one time fee for the land, Azure Power has also created a few employment opportunities in the village. In short, a win-win situation for all the stakeholders.

Another village also situated on the Indo-Pak boundry – Dhoodsar – in Jaisalmer district of Rajasthan plays host to one of the country’s biggest solar power generation plant. The 40-Mw photovoltaic plant, which spreads over an area of 140 hectares, is set up by Reliance Power Ltd. However, it is not the only attempt towards utilizing the immensely available solar energy in the state. There are projects worth about $19 billion to set up solar power generating capacity all around the country by the year 2020. The examples of Awan and Dhoodsar typify India’s growing strides in the field of solar energy generation. If one takes a closer look at the trends over the last 2-3 years, solar energy production has risen year on year. In the past two years, India’s solar power production has grown from 20 Mw to more than 1,000 Mw. Under the country’s ambitious solar program, the National Solar Mission (NSM) launched in January 2010, India has jumpstarted its solar energy industry, fostering growth in both photovoltaic (PV) projects and CSP, also known as solar thermal. Before the Mission began, CSP projects only provided 8.5 megawatts of energy. Two years later, the large-scale CSP projects now underway in India will provide a projected 500 Mw of clean, reliable energy under the NSM. Given the short time frame of the Mission, these numbers are impressive.

The objective of the Mission is to establish India as a global leader in solar energy, by creating the policy conditions for its diffusion across the country as quickly as possible and reduce the cost of solar energy. The Mission aims to install 20 million solar lights and 20 million square meters of solar thermal panel, generating 20,000 megawatts by 2022. With lots of untapped potential just around the corner, solar can contribute majorly to our energy security and power development. Consider the facts: The average intensity of solar radiation received over India is 200 Mw/km square (megawatt per kilometer square) with 250–325 sunny days in a year. India receives the solar energy equivalent of more than 5,000 trillion kWh/year. Depending on the location, the daily incidence ranges from 4 to 7 kWh/m2, with the hours of sunshine ranging from 2,300 to 3,200 per year. Recent research has shown that India has a vast potential for solar power generation since about 58% of the total land area (1.89 million km2) receives annual average global insolation (solar radiation) above 5 kWh/m2/day. The research adds that, given the present efficiency of 11 TW = 1012 watt or 1 trillion watt levels, 1% of land area is sufficient to meet the electricity needs of India till 2031, using current solar technology.
 

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

 

For More IIPM Info, Visit below mentioned IIPM articles

 

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year

BBA Management Education

Is the Corus diet finally showing on Tata Steel’s health?

The Indian steel giant Tata Steel reported an unexpected quarterly loss, its first in more than two years. While some blame it Corus, the Anglo-Dutch steelmaker, and mention that the real price of the acquisition that Tata Steel made in January 2007 is coming to fore, the real reason could simply be rising input costs and dwindling demand in Europe...

Indeed, Ratan Tata is not given to hyperbole or grandstanding, notwithstanding his “you put a gun to my head and pull the trigger or take the gun away, I won’t move my head” comments. Thus, when he had described the Corus deal (Tata Steel acquired the Anglo-Dutch steel maker Corus for $12.04 billion or 680 pence a share in January 2007) as being a “bold visionary move”, many had praised the move as being the harbinger of India’s rise on the global top ranks.

Of course, that part has surely been true, but what hasn’t and cannot be ignored is that he also seems to have invited discomfiting analogies and criticism on the Corus deal from significant quarters. The sounding board of these critics has become more cacophonous with the current situation of Tata Steel – the company is struggling with weak demand and higher material costs and reported a consolidated net loss of Rs.6.03 billion for the third quarter ending December 31, 2011, against a net profit of Rs.10.03 billion during the same period a year earlier.

Critics forward the proposition that had Tata Steel not acquired the Anglo-Dutch giant, it could have been more resilient in the current economic scenario. While that may well be putting it too plainly, the fact is that the acquisition of Corus brought with itself a debt burden of $6.17 billion on Tata Steel’s balance sheet. The company’s total debt liability has only moved upwards since then and today stands at a whopping $9.52 billion (as on December 31, 2011), up from $8.79 billion at the end of March 2011. While the company maintains that the Q3 losses have surfaced due to the exercise of writing down the value of inventories of raw materials and finished goods at some of its subsidiaries, particularly at Tata Steel Europe, to recognise the fall in market price of these products (the write-down for Q3 FY2012 amounts to Rs.7.41 billion or around $143 million), there is more. Steel prices in Europe have risen by approximately 7% during 2012, while prices of coking coal have declined by over 20% in the past three quarters. Imagine what would have happened had the conditions been the other way round. In fact, Tata steel is not the only company which has suffered due to a wounded Europe.

The world’s largest steel producer, Luxemburg based ArcelorMittal, has also reported a fourth-quarter net loss of $1 billion against a loss of $780 million during the same quarter last year. With European Union’s projection for the economy to contract at a rate of 0.3% for calender year 2012, the chances for steel demand to pick up in the region remains bleak, at least in the near future. To add to the woes, the World Steel Association has projected Europe’s steel demand growth for the year 2012 to be a meagre 5.4% compared to 15.1% growth in the year 2010.

Apart from operational issues, Tata Steel Europe is also facing regulatory challenges. It has got the mandate to lower its carbon emissions by 2013 to meet standards set by the European Commission.
 

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Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

 

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face

Training its guns overseas for growth

The lack of high-octane brands and intense competition is perhaps holding back Marico’s growth potential on the home turf, but opportunities in international markets beckon.

For a narrow-based FMCG player, Marico does not mind being a “boringly consistent” company. Over the years it has managed to keep a singular focus on its limited brands, which are profitable and sustainable in the long run, rather than try to expand its portfolio, enter new segments and thereby risk itself spreading too thin. Even though Marico’s corporate motto is “Be more, every day”, its limited mass brand appeal has often proved a hindrance to future growth. Its two master brands – Parachute and Saffola – despite registering a strong 22% CAGR in revenue in the last five years, haven’t been able to make much headway into new product categories. The company’s strategy of keeping a sharpened focus on its limited brands may have served it well so far, but times are a-changin’ and Marico could do better by pulling a few aces up its sleeve.

After all, the opportunity and the market is well in its sights. Already, FMCGs constitute the fourth-largest sector of the Indian economy. The category is estimated to grow to $100 billion by 2025 from the current roughly $13 billion, according to market research firm Nielsen’s report, Consumer 360. And rural India, with over 70% population and accounting for over 55% of consumption, will be the key driver of this growth, as more rural Indians embrace consumption of newer, more contemporary food categories. FMCG players, both homegrown as well as the MNCs, are bracing up to tap this new emerging opportunity. But therein lies the rub for Marico; it doesn’t have the products specifically targeted at this segment.

To give the company its due, Marico has entered new categories of late. Saffola, the premium edible oil brand, has been extended to breakfast cereals and packaged rice. And within a year, Saffola Oats has achieved the third rank in the space with a 16% market share. Even Saffola Arise, the rice brand, is doing well. Both are expected to rack up roughly Rs.400 million in annual sales for the company.

Currently, the oil category, in which Saffola is the market leader with over 55% share, contributes almost 90% of the revenue, while Saffola’s food business brings in the remainder 10%. The company wants it to grow to 75% and 25%, respectively. The Rs.31.3-billion turnover FMCG firm recently posted a 9.4% year-on-year increase in its net profit to Rs.782.9 million for the September quarter. Its net sales increased by 25.6% to Rs.9.75 billion from Rs.7.76. billion year on year.

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Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

 

For More IIPM Info, Visit below mentioned IIPM articles

 

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face

Direct Tax Code: A boon for IT Sleuths!

A Closer Look into The Provisions of The Proposed Direct Tax Code reveals India’s Digression from a Trust-Based system of Taxation to one which is Based more on The Element of distrust.

The existing Income Tax Act, which came into legislation in 1961, has often been criticised for being economically inefficient and incompatible with the current requirements and inequitable to all tax payers. Thus, to avoid this criticism and to replace archaic rules, the Ministry of Finance finally came out with the draft of Direct Tax Code (DTC) Bill in August 2009. But, the draft Bill, after being introduced in public domain, received a lot of criticisms on certain amendments in relation to removal of existing tax subsidies, and modifications in the tax rate structure that it sought to introduce. So, in June 2010, the ministry again issued a new revised DTC Bill and presented the draft to the Union Cabinet.

In what the government has claimed to be an attempt towards bringing path breaking changes to the existing tax regime in India, the DTC Bill, which is proposed to be implemented from April 1, 2012, will replace the five decade old legislation. In fact, in the foreword to the Tax Code, Union Finance Minister Pranab Mukherjee said that “the aim is to eliminate distortions in the tax structure, introduce moderate levels of taxation, expand the tax base, improve tax compliance, simplify the language and lower tax litigations.” Meanwhile, the Bill is being scrutinised by the Yashwant Sinha-led Parliamentary Standing Committee on Finance.

Personal income tax, as almost all salaried persons will agree, in our country is one of the highest in the world. More open and honest an employer is in terms of disclosing remunerations, worse it is for the employees because taxable income goes up. There is no denying that the present system is outdated and rewards dishonesty and non-disclosure of income by way of lower tax. The rationale for introducing DTC, government says, is to increase the efficiency and equity of the tax system by eliminating the plethora of tax exemptions or subsidies that create distortions. Its major policies include replacement of profit-linked exemptions with investment linked incentives, particularly for export units, and reduction in the tax rates to bring more people and companies under the tax net. Even the government wants a modern tax code in step with the needs of an economy, which is now amongst the largest in Asia. “In India, tax reforms have lagged behind growth. It is a big challenge for politicians and policymakers to keep the pace of reforms with growth,” Jeffrey Owens, Director of the OECD Centre for Tax Policy and Administration, said during a recent visit to New Delhi, adding, “Indian economy has transformed in the last two decades. Along with high growth, it has increasingly become the importer and exporter of capital. But tax regulations have largely remained the same. You have to change with the changing environment.” While the rationale behind the government’s proposals with respect to the DTC has been largely accepted as a right step in the right direction, a closer look into the provisions of the proposed tax code reveals India’s digression from a trust-based system of taxation to one which is based more on the element of distrust.

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Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri

and Arindam Chaudhuri (Renowned Management Guru and Economist).

 

For More IIPM Info, Visit below mentioned IIPM articles

 

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face
IIPM – FLP (Flexi Learning Program)

They call it The Kangaroo Trick

Despite The Recent Devastating Floods, Australia’s Expansion is forecasted to Strengthen over The Next two years. In fact, The Country hasn’t seen a Recession since 1990. So, what makes Australia a Recession-free zone?

Only a dozen economies are bigger than Australia (in 2010 its GDP stood at $1.235 trillion; IMF data), and only six nations are richer than it in the world (it has a per capita GDP of $55,590, higher than that of countries like UK, Germany, Japan, US, et al). The country was ranked 2nd in the United Nations 2010 Human Development Index and 4th in Legatum’s 2010 Prosperity Index. And above all, while most of its counterparts have faced the fury of a financial tornado in the recent past, it’s the one that has avoided a recession since 1991. Well, that’s Australia for you today!

But then, the situation wasn’t always the same “Down Under”. Just 25 years ago the Australian economy was grappling with issues like high interest rates (during the ‘80s the minimum lending rate had reached 17%), negative growth (-1.6% in 1983), big budget deficits, et al, coupled with highly regulated financial system (read: protectionism). In fact, in 1985, Paul John Keating, the then Australian Treasurer (he was also the 24th Prime Minister of Australia, serving from 1991 to 1996) had declared if the country failed to reform it would become a banana republic. No doubt, barely five years later, the economy faced a nasty recession, but then, it was the last for this OECD nation. Since then Australia has grown at an average annual rate of 3.6%, well above the OECD average of 2.5%. What’s more? Despite the recent devastating floods, which has forced the Australian economy to contract 1.2% in Q1 2011 (it’s the sharpest fall in real GDP since the recession in 1991) Australia’s expansion is forecast to strengthen over the next two years. In fact, Moody’s Analytics maintains its full-year 2011 GDP growth forecast at 3.4% for Australia.

Many attribute Australia’s success to its opulence in minerals, which thriving Asian nations are hungry for. But then, the economy was standing tall and smiling wide when a financial crisis struck Asia in July 1997. Further, commodity exports have not always been in vogue. It was only in 2003 when minerals begin to garner big bucks for Australia (see chart), but by then the economy had escaped both the Asian crisis as well as the financial cyclone that hit America in 2001. In 2007 came the global financial crisis, but that too failed to drag down the Australian economy. So, what is it that makes Australia a recession-free zone?

No doubt, to some extent, the country has been benefiting from a resources bonanza that brings it big money for doing nothing but extracting minerals and shipping them to Asia (and will continue to do so for a while as Asia’s appetite for minerals shows no signs of slowing), but then that’s surely not the thing that can be credited for the country’s economic success. Rather, it’s the series of well-thought reforms carried over a period of 20 years (between 1983 and 2003) that has made Australia one of the most prosperous and resilient economies in the world today.

Read more.....

Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist). For More IIPM Info, Visit below mentioned IIPM articles

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face
IIPM – FLP (Flexi Learning Program)

B&E This Fortnight

INTERNATIONAL

BUSINESS, ECONOMY & FINANCE$10Bn bid for Foster’s

Despite slow growth and maturing markets in beer producing countries, Australia’s largest brewer - Foster’s Group - has been offered $10 billion by the world’s second-largest brewer - SABMiller - for a takeover of the Australian favourite. SABMiller offered $4.90 per share to Foster’s for the buyout, which was 8.2% higher than the latter’s closing stock price on Monday. The deal would have been the biggest in the brewing industry since InBev bought Anheuser-Busch for $52 billion in 2008, but it was rejected by Foster’s on the grounds of being too low. Showing a strong investor confidence in the decision of Foster’s, the share prices shot up to a 9-month high of 14% on the news. Foster’s has been the subject of takeover ever since it announced its plans to spin off its struggling wine operations - Treasury Wine Estates that got listed in Australia, just last month. SABMiller that makes Peroni, Grolsch and Miller Lite, has been a favourite among the potential bidders. Despite a downturn in the beer market, Foster’s is supposed to be a good option to acquire due to its dominant position in Australia and high margins of about 37% that is almost double of its global peers. It is expected that SABMiller will increase the offer price in the second round of negotiations and the offer price can see a hike of 10-12% to A$5.40-A$5.50 per share.

Cheap us stocks
The shares of companies that make up the S&P 500 index - one of the most used benchmarks for the U.S. stock market - will earn 18% more this year on the back of cheap valuations of shares, the cheapest level in 26 years. Since April, share prices have been on a decline, pushing the price of the S&P 500 to 14.5 times the past year’s earnings, compared with the average of 20.5 since June 1991. As a result the index is valued at 8.7 times cash flow, cheaper than it has been 81% of the time since 1998. But if S&P 500 companies are expected to earn more in 2011 than in 2010, why, then, have prices been falling? That’s because investors are apprehensive of future gains on account of concerns such as the Greek crisis coupled with China’s rising interest rates & the Federal Reserve’s $600 billion stimulus programme.

Greek Crisis Eases
Despite a severe debt crisis hovering over Greece since April 2010, the double blow that it was scheduled to face due to the re-scheduling of the Greek government bonds as insisted by the German government is now slowly easing off. In fact, the German government has also indicated a voluntary rollover of Greek government debt. The debt rating (by Standard & Poor Ratings) for the Greek government bonds has been falling constantly and currently has a “CCC” grade, the lowest rating for bonds in the entire world. But with some luck, Greece may be able to stablise its situation in the short term.

Read more.....

Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist). For More IIPM Info, Visit below mentioned IIPM articles

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face
IIPM – FLP (Flexi Learning Program)

Caught in The Wrong Job?

Merck Today stands at a Juncture where it Requires a Major Overhaul in its Strategic Outlook. Does Kenneth C. Frazier (its current CEO) have what it takes to Guide a Pharma Giant in times of Patent Expiry?

What if you happen to be the recently appointed CEO of a pharma giant in an era of patent expiry & dwindling healthcare policies? And what if, the blockbusters, which generate a quarter of your company’s revenues, are unfortunately poised to go off patent in the next two years? That’s exactly what Kenneth C. Frazier has been struggling since he took over as President & CEO of Merck & Co. from Richard T. Clark on January 1, 2011.

Although facing increased competition, patent losses, and a pipeline of late-stage drugs with poor chances of approval over the last few years, Merck had greatly improved its long-term outlook by acquiring Schering-Plough (for $49 billion in March 2009), but then the challenges remain for Frazier. Raison d’être: Still reeling from the patent loss on its hypertension drugs Cozaar & Hyzaar in early 2010, Merck faces the loss of its next top drug Singulair (for respiratory ailments) in terms of revenue generation in 2012. Considering Singulair represents over 10% of the combined sales of Merck & Schering, the blow will certainly make a big dent on the drugmaker’s topline. Further, Merck faces some remaining legal risk with Vioxx (its popular painkiller). While the majority of plaintiffs participated in the $4.85 billion settlement (in 2008), a few holdouts could ring up additional settlements and significantly hurt Merck’s net profit, which has already witnessed a significant fall, from $12.89 billion in 2009 to $861 million in 2010 (a pathetic 93% drop).

No doubt, indicating a shift in strategy, Frazier, on February 3, 2011, had announced an investment of $8.5 billion in R&D for 2011, but considering that Merck’s efforts to develop a reliable late-stage pipeline have yielded questionable results during the last couple of years, is it really a good bet? “Not really,” feel several critics. By doing so, Frazier has not only compromised the company’s EPS forecast for 2013, but has also offended the Wall Street, which responded back by cutting Merck’s stock price by 2-5% (from the date of announcement). Interestingly, around the same time, Merck’s competitor Pfizer had slashed its R&D budget to $6.5-7 billion from the earlier $8-8.5 billion. And investors awarded the move as the drug giant’s stock price increased by 5-7%.

Such market reaction can perhaps be decoded by expounding upon how this business is evolving. In 2010, the top 10 pharma outfits shelled out a total of $67.41 billion on R&D. In fact, according to statistics compiled by the Tufts Centre for the Study of Drug Development, spending to develop new drugs has been constantly growing over the years. But, what the data also reveals is that after the mid 1990s, new drug approvals have been falling steadily (only 16% win regulatory approval) and research pending has almost doubled in the last one year. This certainly explains the reason for the fall in Merk’s stock price.

If the issue still isn’t clear, then a little flashback might settle the remaining dust. In January 2011, Merck shutdown a study on Vorapaxar and took a $1.7 billion write-down on the drug (a blood thinner which was expected to bring in sales of upto $5 billion). Later in March, it shelved another blood thinner because competitors were way ahead of the development cycle. Further, the 8,000 patient trial of a Staph vaccine was also suspended soon after. All this clearly indicates that Frazier should now be rethinking his strategy. Even if he plans to invest heavily in R&D, it should be focused on a few drugs & executed in a better manner – if not it will continue to fail.

Read more.....

Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist). For More IIPM Info, Visit below mentioned IIPM articles

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face
IIPM – FLP (Flexi Learning Program)

“Germany and France are Adamant and Strong Enough to defend The Euro”

In 2010, Indo-German trade volume crossed The €15 billion mark; a rise of 17.1% y-o-y. Both have set a Bilateral Trade target of €20 billion by 2012. In This Exclusive Interview with B&E, Michael Pfeiffer, Chief Executive, German Chamber of Trade & Invest talks at length on The Opportunities ahead.

B&E: What is the core proposition that you have come here with regarding East Germany and India?
Michael Pfeiffer (MP): Eastern Germany has become one of the popular business locations in Europe, and Europe is a fabulous market for Indian products. At least 50 % of Indian investments in Germany are in the fields of IT and high tech. We want to speak to Indian companies if they want to get access to the European market, and East Germany is a good location in that respect. With the new airports, it’s now one hour closer to India than before. Secondly, our infrastructure provides for easy access to both West European as well as fast growing East European markets.

B&E: How do you see Indo-German trade, which got a big momentum post-liberalisation, going forward?
MP: If you look at the last 10 years, you would notice that Indo-German trade has really become stronger. It has grown from €4.5 billion in 2000 to €13 billion in 2009. For this year, we expect Indian exports to Germany amounting to €6 billion, and German exports to India being €9 billion. So, except for 2009, where we had the global recession, there’s been a strong rise in Indo-German bilateral trade. The same is true for Indian investment in Germany.

B&E: Earlier, there used to be more exports from India than imports from Germany. Now, it’s almost equal. Wouldn’t that create an issue?
MP: Both India’s exports and imports from Germany are rising. It is not so important to have a real balance of trade between the two countries. It’s important for trade balance in general, but your imports & exports are quite balanced. If you look at the structure of exports from Germany to India, it’s mostly machinery. Machinery is needed in India to develop its industries and be more competitive. So, both countries have learnt in the past few years about how to cooperate better.

B&E: Since 2007, you began talks on FTA. Also, during the G20 summit, Indian finance officials met their German counterparts and assured that it will be a reality by this year. How do you foresee this?
MP: If it happens, it will mean there’s less problems with taxes, or no taxes at all. And trade will come up considerably. We will have bilateral trade up to €20 billion by next year, if it happens.

B&E: Do you feel that the trade agreement will be a holistic one, covering a comprehensive number of services?
MP: It will be. Parties want a really good deal for their business communities. The difficult thing is: In Germany, we have a structure with a large number of SMEs. For them, bilateral agreements are difficult to administer, that’s why we preferred multilateral agreements. But for a different market like India, which is fast growing as well, it is a good goal to have.

B&E: What are the key areas where the two nations can work in a better way?
MP: If you look at the past, India’s expertise in textiles were number one, followed by chemicals and electronics. But presently, it’s mostly the IT companies that are setting up the business in Europe including Germany. This shows that Indian companies nurture the goal of becoming high tech partners of the world. That’s also the goal of the German companies investing here – to become partners of technology.

Read more....

Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face
IIPM – FLP (Flexi Learning Program)

Perfect Technology, Flawed Destiny

The Launch of MNP has seen Significant churn by users of CDMA towards GSM. Is this indeed The Death Knell for a Technology that’s already falling out of Favour in India?

CDMA (Code Division Multiple Access) technology has been at loggerheads with the far more widespread GSM (Global System for Mobile Communications) technology since quite a long time. The irony is that basic technological common sense has always favoured CDMA, since it can handle many more calls per MHz. and has a better data transfer rate. However, GSM has been able to cover around 75% of the world’s cellular phones; partly because it is supported by a global entity, the GSM Association. On the other hand, CDMA is promoted by American firm Qualcomm and has not gone much further beyond North America.

In India, however, CDMA came with a lot of hope, albeit for a different set of reasons, as RCOM used it to disrupt the entire pricing structure in the industry. The technology brought down tariff rates to a few paise per minute from a few rupees. Players like RCOM and Tata Teleservices have offered handsets at incredibly low prices, thus connecting the common man with the telecom revolution. Lately, it has also transformed the way we surf internet on the move. CDMA has a peak download speed of 2MB/s compared to 384 kbps for GSM.

However, this great technology appears to be dying a slow death in India, due to lack of spectrum. The shift made by major CDMA players including Tata Teleservices and Reliance to the GSM platform has also cost the technology dear. RCOM and TTSL, after getting 3G spectrum, are focusing more on the GSM business, as the chances of increasing data revenue on the network are high. The third major player MTS is currently looking for M&A partners in India.

The allowance of Mobile Number Portability (MNP) has also hit CDMA technology hard. The first 10 days of port in and port out, after the implementation of MNP on January 20, 2011, suggested that a large number of subscribers are moving out of the CDMA platform and opting for GSM. Data available till January 31 suggests that more than 50,000 subscribers opted out of CDMA, wherein only 2,000 people chose to give up GSM in favour of better voice & data services. “A large number of people are porting just for the experience for now. In the long term, MNP would not make much of a difference, as the handsets and tariff rates of CDMA technology are cheaper then GSM,” says S. C. Khanna, General Secretary, AUSPI (association of CDMA players) to B&E. Hemant Joshi, Partner, Deloitte, Haskins & Sells, supports, “Since the future is in data services and CDMA banks on having good quality data services on their network, it is likely that subscribers will stabilise after the initial churn (of CDMA users post MNP), which could be due to several reasons,” said.

However, the fact is that the trend of preferring GSM is not new over the past few years. As per TRAI data, GSM subscribers for September 2010 numbered 578.49 million (84.12% market share) compared to 109.22 million (15.88% market share) for CDMA. This is in fact a morose scenario for CDMA, since it commanded a share of 26.35% in September 2007. Interestingly, out of six players in CDMA, four have around 12% market share and continue to see a fall in their subscriber base. A major chunk of market share in this space is commanded by RCOM & TTSL.

Read more....

Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face
IIPM – FLP (Flexi Learning Program)

The Uprising in Arab League

Colonial Exploitation, Chronic Under-Development and Kleptocracy are few words which explains The Surge in The Uprising and Eventual change in Power Equations in few members of The Arab League: Egypt, Jordan, Tunisia and Yemen. B&E analyses The Economic Dynamics of The Unrest against The Brutal and Corrupt Police state

Economy Key to Protests

2011 has set the stage rolling for a revolutionary change in parts of the Arab League. Cutting across the borders, the broad contours for the uprise however remains the same. If it was the dramatic increase in cost of living coupled with acquisition of corruption among the ruling elite that rocked the streets of Tunis and Cairo’s Tahrir Square; it was the failure of President Ali Abdullah Saleh to revive the economy of Yemen that initiated protests seeking his resignation. As far as Jordan is concerned, the pivotal reasons were unemployment, rising prices and the right to elect the prime minister. Given its revenue from Suez Canal, oil exports and tourism the Egyptian economy is comparatively better than its counterparts but ironically 20% of its population live below the poverty line.

Unemployment - The Catalyst

The Arab Economic Summit aptly summed up the reason for the Tunisian uprising, which finally culminated in Zine El Abidine stepping down and fleeing his own country after 23 years of misrule. It cited the long standing economic woes ranging from poverty, unemployment and recession as the main reasons, which fuelled unprecedented anger and frustration among citizens. Estimates from the Cairo-based Arab Labour Organisation suggests that the number of unemployed people in the region has exceeded 20 million and given the end of the second oil boom (between 2002 and 2008) and the lack of socio-economic developments the number could increase to 100 million by 2020. Also, the per capita income of the region has come down to $5,159 from $6,002.

Read more...

Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

2012 : DNA National B-School Survey 2012
Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face
IIPM – FLP (Flexi Learning Program)