Curbing inflation seems to be the major concern for RBI. But is the over emphasis on inflation hurting growth? Yes and no! Inflation, which is an 
iniquitous tax, hurts the poor more than the rich, and must be undoubtedly contained. To that effect, the banking industry seems to have paid heed to RBI Governor Y.V. Reddy’s suggestion (or was it an order?) that “net interest margin of banks was high and there was scope for reducing lending rates.” Considering the fact that non-food credit off-take has come down in the recent past, large banks like SBI, HDFC and ICICI decided to bring down the rates. Thanks to the ‘peer fear’, other banks are falling in line. Increasing credit flow to small scale and medium enterprises, and providing a boost to the housing sector as well as to other productive sectors are amongst the few cited positive effects of the rate slash. But in reality, have banks bent down because of a political diktat from the finance ministry?
Dr. Mukesh Kumar Anand (Senior Economist, National Institute of Public Finance and Policy) rules out the logic, and says “The finance ministry does not interfere with the banks in deciding their rates; the finance minister and the RBI governor merely asked them to consider a reduction in rates in order to boost growth.” But sir, that’s not what many banks are telling us. In fact, the smaller banks are waiting for a deeper rate cut, before following suit. Given the situation, bankers with a good quality portfolio and improved operational efficiency would benefit the most. And the rest will need to shape up. According to Ritesh Maheshwari (Senior Director, Financial Institutions Rating, Standard & Poors), “In 2008, the Indian banking system will continue to reap benefits of a strong domestic growth.” It is expected that prudent monetary policy changes will help bring about the benefit of anchoring inflation expectations. With inflation rate under control, interest rates could come down by 25 basis points or so, or remain stable.
Tied in exchange knots
On a visit to Tirupur, which is around an 80 minute drive from Coimbatore airport, there’s hardly anything that would strike you as particularly spectacular, barring the larger-than-life banners of AIADMK chief Jayalalitha and her party leaders. Even the locals grudgingly admit that there is not one tourist attraction to boast off, and if it were not for the giant strides made as an export hub for knitwear, Tirupur would have had a very slim chance of moving out of obscurity. But move out it did, and how, thanks to Verona, an Italian merchant who recognised the potential and brought in a deluge of business opportunities for these hardworking, entrepreneurial people, mainly from Europe & America. Indeed, the story of Tirupur is, in many ways, a story of the Indian resurgence in manufacturing and exports. Local exporters have been servicing many high-profile international apparel brands like Nike, Adidas, Arrow, Tommy Hilfiger, and departmental chains like Wal-Mart, Target, Sears and Mother Care. In 2006-07, Tirupur’s turnover was a whopping Rs.110 billion.
However, nothing could have prepared these people for the rude shock that came up last year, when the rupee appreciated by almost 14% to the dollar in a very short span of time, making it extremely difficult for them to negotiate better terms with their buyers. Largely unaware of the vagaries of financial markets and hedging techniques, many exporters, who were bullish about expansion till early last year, are now looking for ways to sustain, thanks to business lost to competing countries like Bangladesh, China, Sri Lanka, and Indonesia. Sums up S. Sakthivel, Executive Secretary, Tirupur Exporter’s Association, on the impact, “We were enjoying annual growth rates of over 25% since the last two financial years. But we are expecting to register a turnover of Rs.90 billion for the financial year 2007-08 (which is, in fact, a negative growth of nearly 20%).”
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Source : IIPM Editorial, 2008
iniquitous tax, hurts the poor more than the rich, and must be undoubtedly contained. To that effect, the banking industry seems to have paid heed to RBI Governor Y.V. Reddy’s suggestion (or was it an order?) that “net interest margin of banks was high and there was scope for reducing lending rates.” Considering the fact that non-food credit off-take has come down in the recent past, large banks like SBI, HDFC and ICICI decided to bring down the rates. Thanks to the ‘peer fear’, other banks are falling in line. Increasing credit flow to small scale and medium enterprises, and providing a boost to the housing sector as well as to other productive sectors are amongst the few cited positive effects of the rate slash. But in reality, have banks bent down because of a political diktat from the finance ministry?Dr. Mukesh Kumar Anand (Senior Economist, National Institute of Public Finance and Policy) rules out the logic, and says “The finance ministry does not interfere with the banks in deciding their rates; the finance minister and the RBI governor merely asked them to consider a reduction in rates in order to boost growth.” But sir, that’s not what many banks are telling us. In fact, the smaller banks are waiting for a deeper rate cut, before following suit. Given the situation, bankers with a good quality portfolio and improved operational efficiency would benefit the most. And the rest will need to shape up. According to Ritesh Maheshwari (Senior Director, Financial Institutions Rating, Standard & Poors), “In 2008, the Indian banking system will continue to reap benefits of a strong domestic growth.” It is expected that prudent monetary policy changes will help bring about the benefit of anchoring inflation expectations. With inflation rate under control, interest rates could come down by 25 basis points or so, or remain stable.
Tied in exchange knots
On a visit to Tirupur, which is around an 80 minute drive from Coimbatore airport, there’s hardly anything that would strike you as particularly spectacular, barring the larger-than-life banners of AIADMK chief Jayalalitha and her party leaders. Even the locals grudgingly admit that there is not one tourist attraction to boast off, and if it were not for the giant strides made as an export hub for knitwear, Tirupur would have had a very slim chance of moving out of obscurity. But move out it did, and how, thanks to Verona, an Italian merchant who recognised the potential and brought in a deluge of business opportunities for these hardworking, entrepreneurial people, mainly from Europe & America. Indeed, the story of Tirupur is, in many ways, a story of the Indian resurgence in manufacturing and exports. Local exporters have been servicing many high-profile international apparel brands like Nike, Adidas, Arrow, Tommy Hilfiger, and departmental chains like Wal-Mart, Target, Sears and Mother Care. In 2006-07, Tirupur’s turnover was a whopping Rs.110 billion.
However, nothing could have prepared these people for the rude shock that came up last year, when the rupee appreciated by almost 14% to the dollar in a very short span of time, making it extremely difficult for them to negotiate better terms with their buyers. Largely unaware of the vagaries of financial markets and hedging techniques, many exporters, who were bullish about expansion till early last year, are now looking for ways to sustain, thanks to business lost to competing countries like Bangladesh, China, Sri Lanka, and Indonesia. Sums up S. Sakthivel, Executive Secretary, Tirupur Exporter’s Association, on the impact, “We were enjoying annual growth rates of over 25% since the last two financial years. But we are expecting to register a turnover of Rs.90 billion for the financial year 2007-08 (which is, in fact, a negative growth of nearly 20%).”
For Complete IIPM Article, Click on IIPM Article
Source : IIPM Editorial, 2008
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of FY 2007 at 4.9% (its fastest pace in the last four years), many felt that the worst was over. But, as the US Commerce Department, on January 30, came out with the latest numbers, it only provided further credence to the arguments that the US is knocking on the door of recession, if not already in.
as the minister. Do you see a situation wherein the national carriers could become minor players in the company of many private operators, big and small? Although the number of passengers carried by the national carriers has increased considerably, registering a growth of almost 25%, the market share has been impacted due to the entry of private airlines, availability of low cost carriers, decline in capacity share, and delay in acquisition of new and latest technology aircraft. However, a number of initiatives have been undertaken like acquisition of new aircraft, merger of Indian and Air India, aggressive marketing and sales initiatives, which has resulted in marked improvements in market share.
as a cricket administration institution and as a positive for the team is not up to the mark. “It’s easy to manipulate the masses when it comes to winning elections. But to really manage the Indian cricket team, you need to be an emotionally intellectual person, which Pawar isn’t at all,” feels a former cricketer who knows the BCCI President for the past five years. For instance, they say that the BCCI shouldn’t have been so quick in asking the Indian team to continue with the current Australian tour after what happened during the second test at Sydney. It should have waited to gauge the mood of the team and taken into account the feelings of the manager. In the end, BCCI had to backtrack and use its clout to force the ICC to arrive at a face-saving solution.
Paper No. 99 named Dreaming with BRICs: Path to 2050 is no news now-a-days, at least in India, given the impunity with which this has often been referred to by nation’s polity and policy makers to showcase the bright future of our country. And also as if forewarn all those, who are yet to make up their minds about investing in India or take it seriously, as to what a grave mistake they would commit if they gloss over the writing on the wall.
a decade ago and was talked about in the IT arena as ‘the’ idea that would take away computing from the desktop to an imagined central hub – of course known to most, today, as the Internet. After a promising start ‘Grid Computing’ eventually found no takers, but the idea lingered on and has now made a comeback of sorts, reinvented and rechristened as ‘Cloud Computing’ or simply stated, a cluster of programs running through thousands of parallel computers and accessible through the Internet.
of entry and exit from the stock market or a mutual fund is a difficult call. The decision purely depends on the investor’s choice, driven by his investment objectives, his perception of the market and other relevant factors. However, common sense tells us that a good time to enter a market is when the market looks attractive and valuations of stocks seem relatively cheap. Similarly, exit when it is on a high. But for a happy exit, the following points should be kept in mind:
most flamboyant business tycoon, Richard Branson created waves across the globe. But now he’s trying to regain his virginity (ahem! We mean the Virgin Radio brand in UK). The buyout of Virgin Radio by Indian media powerhouse Bennett, Coleman & Co. Ltd. (BCCL) has taken the Indian media by storm. However, Branson’s intervention to keep BCCL away from using the Virgin brand may be a damp squid for BCCL’s overseas plans. Will Branson’s bravado prove fatal for BCCL? Or is it just a hiccup that will soon pass by?
has gone aggressive and has been constantly adding more numbers in its total tally. Biswajit Pandey, Marketing Head, RPG Cellucom revealed to this magazine that the group has been adding 25-30 stores every month since August and plan to take the tally up to 500 stores by March 2009, at an investment of Rs.50 crore every month. Hot Spots too scores well on the number of stores front, although their largest presence is restricted to Delhi (more than 107 stores of their total is in NCR alone). Even mBazaar has massive plans for this year. Firstly, it plans to take the tally of stores to 500 by Dec. 2008 (via the cluster stores format) and would be pumping in almost Rs.300 crore for this count. Also on the cards is a major re-branding strategy wherein by next month, mBazaar would rechristen itself “Mobile Bazaar” and would harp on the value format. Alongside, there are also plans to set up a lifestyle store called ‘Axiom’ for mobile retailing. 
Advertising agencies too have struck a gold mine with IPL as all teams are spending multi-millions on creating high decibel campaigns. Rajasthan Royals, Deccan Chargers and Daredevils plans to spend roughly Rs.20 crore this year. And this is when purportedly, the franchises did not have much time to prepare for this cricketing jamboree. In future, the hospitality and aviation sectors are also likely to get roped into the IPL mania as fans get more passionate about their teams and travel to different cities to watch the game. Time for agriculture minister cum BCCI chief, Sharad Pawar to declare cricket as an industry? Well, the game, as they say, has only just begun – both on and off the field! 
its new facility in Chennai. And this news is closely followed on the heels by another International media conglomerate – Turner International, announcing their interest in setting up a subsidiary in India. In December 2007, DreamWorks Animation too had formed a strategic alliance with Technicolor which will assist them in developing animation capabilities in India through Paprikaas Animation Studios. “We also saw Rhythm & Hues have set up their units in Mumbai and Hyderabad a few years ago,” discloses Rajiv C,Founder, Director of Greengold Animation Pvt. Ltd., Hyderabad. So is it an opportune time for creators of the animated characters to leverage the ensuing potential?
From Amul’s ‘Slim and Trim’ milk & curd (and similar variants from Nestle and Mother Dairy), to diet chocolates like Kit-Kat Lite to pro-biotic ice-creams to Diet carbonated drinks to Maggi Atta & Rice noodles to diet cornflakes like Kellogs K series… there are myriad products in this niche. “Niche marketing in food & beverage industry is a very popular phenomenon for marketers abroad and is picking up in India too. We in Mother Dairy, believe such marketing helps to capture the market well, so we will be launching lots of product for a certain class of consumer,” Paul Thachil, CEO, Mother Dairy Food Processing Ltd. told this magazine.