INDIA WILL BE THE 6TH LARGEST

EMERGING MARKET BY 2012

PRESENTED BY: (INMANTEC)

=)RANJEET KUMAR(PGDM)
2007-09 BATCH
WHY INDIA?

 Growing GDP
 Strong FDI inflows
 Powerful macro economics
(Economic/Demographic/Globalization)
 Primary Sector/Secondary/Tertiary Boom
Growth Driven by an interplay of Three Macro
Factors:
 GDP GROWTH

It will be in double digit by 2012(11th five year plan)

 FDI GROWTH

Major Sectors in India Attracting FDI Inflows till June 2007

(from August 1991) -
 Services (USD 9,443 million)
 Electrical equipment (USD 8,964 million)
 Telecommunication (USD 4,880 million)
 Transportation (USD 3,856 million)
 Fuels (USD 2,892 million)
 Chemicals (USD 2,465 million)
 Construction (USD 1,912 million)
 What government is doing for FDI inflows?

Role of Government in FDI Inflows in India-

 The Government of India has granted permission to foreign
investors to set up Joint Venture companies with various private
sector units in India. This task is carried out with the aim to
establish country-specific investment promotion centers in India
and overseas countries.
 The ten countries who will be involved in setting up country-
specific investment promotion centers in India include, US, Japan,
Taiwan, UK, Germany, Singapore, France, South Korea,
Switzerland and Italy.
 TO DRIVE CONSUMPTION BOOM:

- Rising per capita income, improved affordability & changing

lifestyles
- Urbanization: Shift from low productive farm jobs to
manufacturing & Services. SOURSE:RBI
 GLOBALIZATION – RESERVOIR OF
INTELLECTUAL CAPITAL:
.

-Success rate for admission to the top technology institutes - IITs is 2%; at 10%
- 250 universities, 1,500 research institutions,10,000 higher education institutes. 3
million new BA’s per year.
- Pool of 23m professionals (graduates/post grads)
– Doctors, Accountants, IT engineers,Engineers
- Post-Graduates increasing by nearly half a million every year
-Historically India has been a net exporter of talent – Indians makeup a significant
proportion of Microsoft, IBM’s development teams or Intel’s scientist pool
GLOBALIZATION – RESERVOIR OF
INTELLECTUAL CAPITAL
Recent Acquisitions:
 - Tata – Corus, Land rover,Jaguar(UK)

 - Birla – Novelis (US)

 - Essar- Algoma Steel (Canada)

 - All cash takeovers!

SOURCE
AGRICULTURE SECTOR

 India ranks second worldwide in farm output.

 Agriculture and allied sectors like forestry, logging and fishing
accounted for 16.6% of the GDP in 2007, employed 60% of the total
workforce and despite a steady decline of its share in the GDP, is still
the largest economic sector and plays a significant role in the overall
socio-economic development of India.
 Yields per unit area of all crops have grown since 1950, due to the
special emphasis placed on agriculture in the five-year plans and
steady improvements in irrigation, technology, application of modern
agricultural practices and provision of agricultural credit and subsidies
since Green revolution in India
SOURCE:WIKIPEDIA&CIA WORLD FACE BOOK
 INDUSTRY SECTOR

Industry
•India is fourteenth in the world in factory output. They together account for 26.4% of
the GDP and employ 17% of the total workforce. However, about one-third of the
industrial labour force is engaged in simple household manufacturing only.
• Economic reforms brought foreign competition, led to privatization of certain public
sector industries, opened up sectors hitherto reserved for the public sector and led to an
expansion in the production of fast-moving consumer goods.
• Post-liberalization, the Indian private sector, which was usually run by oligopolies of
old family firms and required political connections to prosper was faced with foreign
competition, including the threat of cheaper Chinese imports. It has since handled the
change by squeezing costs, revamping management, focusing on designing new products
and relying on low labour costs and technology.
SOURCE:WIKIPEDIA&CIA WORLD FACE BOOK
 service sector

• India is fifteenth in services output. It provides employment to 23% of work force,

and it is growing fast, growth rate 7.5% in 1991–2000 up from 4.5% in 1951–80. It has
the largest share in the GDP, accounting for 55.4% in 2007 up from 15% in 1950.
• Business services (information technology, information technology enabled services,
business process outsourcing) are among the fastest growing sectors contributing to one
third of the total output of services in 2000.
• India's IT industry, despite contributing significantly to its balance of payments,
accounted for only about 1% of the total GDP or 1/50th of the total services.
SOURCE:WIKIPEDIA&CIA WORLD FACE BOOK
.
.

.
India has one of the world's fastest growing automobile
industries and is global leader of auto industry.Shown here is
Tata Motors' Nano,.
world's least expensive car in production.

By 2028, India is expected to have the fifth-largest consumer

economy in the world due to sustained growth among all
sectors of Indian economy.Shown here is a mall in Malad,
Maharashtra.

Tea plantation in Assam, eastern India. India is the largest

producer and consumer of black tea in the world.

A fisherman in Kerala, India. Fishing is an

important industry in coastal areas of India.
 Cuffe Parade is an important business district in
Mumbai, home to the World Trade Center as well as
other important
.
financial institutions

.
. A business park in Gurgaon, India.

The Mumbai-Pune Expressway is one of the largest

infrastructure projects taken up by the Indian government

An Indian farmer on his mobile phone in

the middle of a field.
 INDIA: CONSUMPTION FUELS
CONSTRUCTION BOOM

>500
Shopping Centers under construction in INDIA
INVESTMENT - INFRASTRUCTURE

Infrastructure Life Cycle

Over 20 years:
1. Power Projects
2. Seaports and Ships
3. Railways and Trains
4. Airports and Jets
5. Highways
6. Buildings
INFRASTRUCTURE – HUGE INVESTMENTS
PLANNED

 Power
 – Govt. vision of power for all by 2012
 – Target capacity addition of 100,000MW by 2012
 – Up gradation of transmission lines by PGCIL
 Roads
 – Investment of Rs. 1,870bn in next 7 yrs
 Ports / Inland Waterways
 – Rs 600bn investment for port infrastructure
 – Rs 400bn investment in water transportation
 Airport
 – Privatization and Up gradation of airports
 Pipelines
 – Investment opportunity of Rs 400bn
SOURCE: SSKI
 SEZ
 – Govt. recently cleared 148 projects involving Investment of Rs.1000bn
 Estimated Investment from 2005-10E

 AREA TOTAL RETURN(C$)

 Urban Infrastructure $16,638,300,000
 Bus Terminals $237,690,000
 Irrigation & water supply $12,175,010,000
 SEZ $3,063,560,000
 Airports $6,021,480,000
 Pipelines $10,564,000,000
 Railways $19,781,090,000
 National Maritime Dev. Programs $8,847,350,000
 Ports $6,602,500,000
 Roads $65,127,060,000
 Power $78,516,930,000
 TOTAL $227,574,970,000 SOURCE: SSKI
 RETAIL “High-time” [Europe to India]

Germany Spain Europe

In the present scenario all retail giants from Europe are eyeing for
overseas expansion.
Global markets appear to be an attractive opportunity as domestic
market is saturating.
Many retailers from Aldi to Zara have expanded their brands
internationally & new champs have already emerged from Europe
like B & Q, H & M. SOURCE:MCKINSEY

Germany Spain
 RETAIL “High-time” [UK vs Euro to India]

England England England

Tesco, Mark & Spencer's(England), Dixon's (England) are the big
players of retail from U.K and few Dutch retails like Ahold holds a
.
position of international leader in the supermarket sector.
The Retail market in India is in takeoff stage and that in Europe or
U.K in Maturity stage. Their strategy is matured & environment in
India is new for a fresh growth. If co-operation & hand-joined
operation is made between India, U.K & Europe it can be of immense
benefit.
SOURCE:MCKINSEY

Netherlands
GROWING RETAIL SECTOR IN INDIA

Retail sector is also contributing, to be a 6th largest

emerging market by 2012.
 REASON: Income, population growth and saving behaviors.
 The rising population of working women, the rising services
sector, the growing middle class and easier access to credit
are some of the factors that will fuel the growth of retail
industry in India .
 Dr Ira Kalish, director, Deloitte Research, opined that the
retail evolution in India is still in its nascent stage and said,
“While the Indian retail market is promising, it has a long
way to go to make a mark on the global level.”
 CONCLUSION
.
 INDIA