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MOTLEY COLLECTION OF BUSINESS AND ECONOMIC NEWS |
The big rush to small town India
Indian companies find a huge unexplored market in what is called the 'bottom of the pyramid' or the lowest income bracket population. Gearing up for this market, a number of firms have devised innovative schemes to make their way in.
Mobile phones are spreading like wildfire in smaller towns. As the market in large cities hits saturation levels, the untapped market in towns and villages is the centre of attention. Sales of desktop PCs in India at 3.6 million per year are still low. One firm has come out with a basic desktop model for $220 while others are planning PCs for just $100. In medicine there have been several innovations. The prosthetic Jaipur Foot costs just $30 and is of better design and as effective as one made in the US at over a hundred times the cost.
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 Logica driven
LogicaCMG started in India in 1998. Initially, it was a domestic operation selling finance solutions locally and reselling and integrating a suite of third-party retail banking products through a 90-strong software development company in Bangalore.
India is critical to the global strategy of the company. India plays a key role in its global operations. LogicaCMG started with product engineering in India in 1998. This was followed by providing offshore IT services in India in 2000. The company now focuses on providing application management, applications development, product engineering, BPO and shared services to its global clients from India.
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 India hits the fast lane
A Goldman Sachs report ('Dreaming with BRICs: The Path to 2050') states that among Brazil, Russia, India and China, India will grow the fastest over the next 30 to 50 years by leveraging its demographic advantages and through continued development. At its present rates of growth, the burgeoning market in the country "would be adding nearly one France every 3.5 years and one Australia every year". India is not merely a provider of services. Besides being an outsourcing hub, it has grown into a global manufacturing hub.
The centre of gravity is moving eastwards to Asia, away form Europe and North America, and India will be the motor force in globalisation
—Frank G. Wisner
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 Mitsubishi bets on Bengal
Mitsubishi Chemicals of Japan, which already has a significant presence at Haldia in West Bengal, is setting up its second unit at Haldia. While addressing members of the Bengal Chamber of Commerce & Industry (BCCI) at BCCI's 151st AGM, chief minister Buddhadeb Bhattacharjee said the Japanese major has planned to invest close to Rs 1,665 crore on a second chemicals unit with a capacity of 8 lakh tonnes. The first unit, with a capacity of 4.7 lakh tonnes and now making profits, had entailed an investment of Rs 1,475 crore. He said a large team from Mitsubishi Chemicals was expected to visit the city in mid-January and formally announce the setting up of the second unit at
Haldia.
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 Belgians say it with flowers
With the Uttaranchal government deciding to set up a floriculture export zone, a top Belgian firm said it would invest $1.3 million in various projects in the state. During a meeting with chief minister N.D. Tiwari, Diroj Rignald, managing director of Diroj Plants, said his company would set up various projects with an initial investment of Rs 6 crore.
Stating that the environment was conducive for the growth of floriculture sector in Uttaranchal, Rignald told Tiwari that the government should take steps to boost the floriculture sector. Welcoming Rignald, Tiwari said his government has decided to set up a floriculture export zone and had launched efforts to invite foreign investments in the sector. “This will give positive results in the state,” Tiwari said.
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 FM tunes into higher growth frequency
After ensuring that India got the recognition of a "potential global economic powerhouse" last year, Finance Minister P Chidambaram made his New Year wish of sustaining over 7 per cent growth in 2006. "In the year 2005, India received significant international recognition as potential global economic powerhouse. I hope that in 2006, India will make substantial progress towards realising that potential," Chidambaram said in his message for the New year.
"The only way to make growth more inclusive is to sustain the rate of growth in excess of 7 per cent over the next year. And I am confident that the year 2006 will continue the trend," he said. In order to sustain the high growth, he said investment needs to be stepped up particularly in infrastructure, agriculture and social sector. "The key to addressing growth with equity in this country is agriculture," he said adding that the UPA was committed to stepping up public investment and flow of credit to the farm sector.
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February 2006
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