India 3rd largest economy in 25 years
Leading American economist, William T. Wilson, chief economist for Keystone India says India will surpass Japan to become the world’s third largest economy (after the US and China) within 25 years. Keystone facilitates the flow of trade and investment between the US and India. Wilson said: “Demographics and economic reform are driving India’s growth.” In his research report titled The India Century, he said with half the Indian population under the age of 25, we have the youngest labour force in the world and India’s working age population is expected to grow continuously over the next 40 years. “India’s economic reforms, which formerly were driven by responses to crises, are now driven by policy,” his report said.

Adidas launches its first all-women store

The Eva Mall in Bangalore is special. Adidas’ new store in the country is its first showroom run exclusively by women and for women. The showroom will stock a wide range of products from footwear to apparel. “We opened it in Bangalore because of the space available here and the life style of the people here,” said Andreas Gellner, managing director, Adidas India Marketing Pvt Ltd. Reports say they are also looking at bringing in a new ambassador. Adidas will also open showrooms in Mumbai and Delhi this year. Gellener said that 85 per cent of the products are manufactured in India because of the low-cost advantage.

Alstom, Infosys in US $39 mn R&D tie up

French engineering major Alstom plans to invest $39 million in an R&D centre at Infosys’ Electronics City facility and hire up to 300 people in the next three years. By investing in Indian engineering talent and research capabilities they hope to cater to the Indian, regional and world markets with solutions developed out of India. Infosys’ Nandan Nilekani said their company expected this engagement “to strengthen domain knowledge in the power sector,” apart from its traditional strengths in automotive, telecom and aerospace. This is Infosys’ three-year engineering services contract with Alstom, that is a $18bn power generation and rail transport infrastructure provider. Alstom has 18 R&D centres across the globe but this will be the biggest. The centre on the Infosys campus is the first one set up in partnership with a third-party service provider.

IT exports up to US$17 bn

And now, India commands an impressive 44% share of the total global outsourced market as far as IT is concerned. Technology exports from India rose in FY05 to $17.2bn, a 34.5% growth over $12.8bn earned in previous fiscal according to Nasscom, the trade body for technology service industry. Projected IT and ITES export growth in the current fiscal is $22.5bn, a 30-32% increase. Growth on a big base is a challenge and the industry needs considerable support from the government specifically on the infrastructure front and also through supportive policies, said Kiran Karnik, President, Nasscom. Karnik said that the performance of the Indian software and services export industry shows that it is on track to attain the projected target of $50bn in FY09.

FI Cap raised, FIIs allowed in print media

The government has notified that the foreign investment cap for non-news journals and magazines has been raised to 100% from the current 74%. The 100% foreign investment cap will apply to Indian entities publishing scientific, technical, specialty and all non-news print media journals. Niche magazines such as those on sports, gardening, cookery and science have attracted foreign investment so far. Business magazines are also keen on Indian ventures. At the same time, Information and Broadcasting Minister S Jaipal Reddy has announced that the government would allow foreign institutional investors to invest in Indian newspaper companies. But this investment cannot be more than the sectoral cap of 26 per cent. Besides, the government will also allow printing of international editions of foreign newspapers in India.

Planet Hollywood has signed a master franchisee agreement with the US-based Arch Millennium Corp., promoted by Indian-origin businessmen for its foray in the Indian market. Planet Hollywood will be investing about 15 million dollars to set up five restaurants in Mumbai, Delhi, Bangalore, Goa and Hyderabad by 2010. Siddharth Mobar, President and CEO of Arch Millennium, says it takes approximately 2.5-3 million dollars for developing one restaurant. It would also be bringing in famous film stars and personalities from the West to promote the restaurants, apart from selling Hollywood-related merchandise. The first one is expected to come up in Mumbai. The company has many of the dishes named on Hollywood stars, and plans to add the local Indian flavour by roping in some of Bollywood’s stars in the coming time.