North East has Potential to Emerge as Largest Oil Palm Cultivator in the Country

Summary

* OPDPA, continues to request government to introduce structural and policy changes to fully leverage the potential of the crop for the benefit of farmers, employment generation, and reduced dependence on imports and economy at large 

* Region has the capacity to produce 1 billion dollars equivalent of Crude Oil Palm imports 

OPDPA (Oil Palm Developers And Processors Association), the Nodal Agency for Oil Palm Cultivation in India lauds the message by the PM Mr. Modi for recognising the need and importance of being self-reliant in edible oil, and asking Farmers and State Governments of North East to pursue Oil Palm cultivation. His message clearly underpins the benefits of Oil Palm cultivation to the overall Atmanirbhar Bharat agenda as well as its potential to help with the growth story of the region. 

The PM has recommended the State Governments of North East region to set up oil palm missions in their respective States to promote cultivation of the Oil Palm. The setting up of these missions will help boost the ecosystem as well increase focus for the adoption of the crop. Oil Palm cultivation in North East Regions can tremendously boost the economy of the region leading to large scale development and progress of the region. 

Commenting on the progressive step taken by the Government, Mr. Sanjay Goenka, President of OPDPA said, “The expanse of Oil Palm cultivation in the country is very negligible today as compared to the potential the crop possesses. We have seen the transformation this crop has brought about in the lives of farmer community in Andhra Pradesh and we hope to emulate the same in the Northeastern States as well. A strong and robust long term policy mechanism needs to be introduced to give this crop the required push across India. Given the Honorable Prime Minister’s Atmanirbharta vision, India can truly achieve its goal of self-sufficiency in Edible Oils by pushing for development in the Oil Palm Plantation sector 

In North East, the states of Arunachal Pradesh and Assam have tremendous scope for undertaking and increasing area under Oil Palm. The Agro-Climatic conditions of the region are extremely suitable for Oil Palm cultivation and therefore, the region has the potential to cover over 2,00,000 Acres. Equivalent to 1 billion dollars of imports can be prevented. 

Members of the OPDPA, Including 3F Oil Palm, have already set up base and are working closely with the state governments of NE to create awareness on the benefits of the crop. 3F Oil Palm, a pioneer in Oil Palm cultivation in the country, currently operates in Arunachal Pradesh and has already covered over 5000acres of Area under Oil Palm in the Lower Debang Valley District of Arunachal Pradesh. Plans are in the pipeline to set up a state of the art Processing facility with a captive power plant.   

Oil Palm crop is a highly remunerative crop that has the potential to provide the highest return on investment per acre compared to other commercial crops. Farmers in Andhra Pradesh are a living testimony to the far-reaching benefits of this crop for their livelihoods and future. 

India is heavily dependent on imported edible oils, With nearly 15 million tonnes (or nearly 68 per cent) of edible oils getting imported to meet the country’s annual requirement of about 22 million tonnes. Of the total 15 million tonnes of import, about 9 million tonnes (or nearly 60 percent) is palm oils. 

“The  industry is in need of several reforms to maintain its viability and attract further investments in various states of India. OPDPA has been aggressively pursuing the agenda with the Government to bring in structural policy changes which will greatly propel the industry to new growth levels. With the policy changes proposed by us, we can truly achieve our Hon. PMs vision of Atmanirbharta in Edible Oils”, Mr. Sanjay Goenka added further. 

Some of the key asks by the association are: 

Stable pricing mechanism to be put in place for protecting the Indian Oil Palm farmer from fluctuations in price of the produce and continue to motivate him to grow the crop. A fixed MSP mechanism as suggested by the draft CACP report of 2018, will go a long way in this regard.  

A special package for the northeast will quickly help the country in bringing large areas under oil palm plantation (Including making available unutilized government land to Oil Palm companies for captive Oil Palm plantation). 

About OPDPA: 

The Oil Palm Developers and Processors Association (OPDPA) is a consortium of companies that include 3F Oil Palm Pvt. Ltd., Godrej Agrovet Ltd. Ruchi Soya Industries Ltd. etc, established to work towards the growth of the Oil Palm Industry. Despite a challenging policy and regulatory environment, over the last 2 decades the industry has grown from a ‘0’ hectares in oil palm then to a respectable 200,000 hectares across several states including the North East. The industry has a huge potential to help India bridge the country’s edible oil deficit, generate several thousand jobs and help in nation building. 

Over the next 5 years 1,000 German firms may invest in India

Upbeat on the second fastest growing economy in the world, about 1,000 German firms may invest in India in the next five years, the head of Baden-Wurttemberg, regarded as the most successful German state, said today.

"I am sure, in next five years 1,000 more companies from Germany and may be 200 from our state would be interested in investing in India," Guenther H Oettinger, the Minister- President of State of Baden-Wuerttemberg (Germany) said here.

About 1,800 German firms, including Porsche, Siemens, BMW, Voith and Audi have already invested in India which is being seen as the potential German manufacturing hub for the Asian market.

Indian industry and workers match the quality of Europe's and North America's, Oettinger said at the CII meeting.

With over six per cent expansion, the Indian economy is the second fastest growing after China despite global recession.

German Ambassador to India Thomas Matussek also addressed the meeting stating the India-German bilateral trade is expected to touch $27 billion by 2014 from over $18 billion in 2008.

India's major exports to Germany include garments, machinery and instruments, electronic goods and transport equipment, while imports comprises machinery, iron and steel, machine tools and organic chemicals.

Agencies

Is Peanuts what you will be paid for IT job?

One may boast of being employed in IT in the current scene, however they have to work twice as much for getting an interview and the annual salary is peanuts compared to earlier days. A worsening economic crisis, increased availability of skilled workers and lower demand for software services have brought down the entry-level salaries for IT professionals in the country by up to 20 percent, according to experts tracking the sector.

Every year, around 3,00,000 computer science and engineering graduates seek employment with hundreds of tech firms, including big names such as Tata Consultancy Services (TCS), Infosys and Wipro. This year, more than half of them were left unemployed because tech firms were already finding it tough to manage resources sitting on the bench, according to Economic Times.

"The entry-level salaries are down by at least 10-16 percent. Last year, a number of companies gave away offer letters but did not recruit. On top of that, there is a new pool of qualified professionals being churned out this year - all this has created an oversupply in the entry-level IT job market where salaries typically sway between Rs. 3 lakh per annum and Rs. 5 lakh on the higher side," said GC Jayaprakash, Principal Consultant of Stanton Chase International.

Until two years ago, almost all computer and engineering graduates were absorbed by India's outsourcing industry, comprising top tech firms such as TCS, Infosys, Wipro and many others. However, as customers delayed and shelved outsourcing projects, these tech firms also postponed campus hirings. Many students had to approach potential employers directly, since companies did not visit their campuses for placements. "We formed groups and toured companies, and agreed to settle at lower salaries because it's better to be employed at lower salary than having no job at all," said Srilekha Varma, who recently accepted a job offer from a Chennai-based IT firm specializing in banking software.

In a normal year, computer science graduates were offered entry-level salaries of Rs. 3.5-5 lakh. However, companies are now hiring freshers at Rs 1.7-3.5 lakh. However, human resources heads at tech firms, including Wipro, India's third-largest software exporter, say professionals have become more realistic about what they want from their employers. "I don't think salaries have come down, but the environment has indeed helped us in containing salary hikes," Pratik Kumar, Head of Human Resources at Wipro said.

But few companies have not forgotten the offers made. TCS said it would do new campus hiring in January 2010 and will honor all 24,000 offers made for financial year (FY09). "Around 1,800 graduates have joined us in second quarter (Q2) and another 8,000 will join in Q3, rest of the graduates will join based on the demand," a TCS spokeswoman said. Infosys said for FY10, it has made 20,000 campus offers and expects an 80 percent conversion rate i.e. 16,000 of these offers to join the company. "We are honoring all our hiring commitments," an Infosys spokeswoman said.

Agencies

$17 bn software exports for India's IT state

Defying the global meltdown, Karnataka earned $17 billion (Rs.74,929 crore) from software exports last fiscal (2008-09) as against Rs.60,800 crore the previous year, registering a 23 per cent growth in rupee terms and 21.5 per cent in dollar terms.

"The export performance of the IT industry in the state, especially Bangalore, demonstrates the knowledge sector remains unaffected by the global meltdown and decline in IT spending overseas," state Information Minister Katta Subbramanya Naidu told reporters here.

As India's tech hub, Bangalore accounted for Rs.72,506 crore or 97 per cent of the state's total exports, while the remaining Rs.2,423 crore are from tier-two cities such as Mysore, Mangalore and Hubli-Dharwad, registering 45 percent year-on-year (YoY) growth.

India's combined software exports -- spanning services, products and business process outsourcing (BPO) -- grew 21 per cent to $50 billion (Rs.2.22 trillion) as against $41 billion (Rs.1.84 trillion) in 2007-08.

Karnataka accounted for 34 per cent of the country's total software exports last fiscal.

"The growth is substantial especially in the current economic scenario. The state retains its top position in the sector, including exports," Naidu said.

Naidu said the state had set a target of $20 billion (Rs.1,000 billion) this fiscal.

Incidentally, the industry's representative body, National Association of Software Services and Companies (Nasscom), has forecast India's software exports this fiscal to be around $48-50 billion.

According to R. Rajalakshmi, director of the Bangalore chapter of the Software Technology Parks of India (STPI), Karnataka's software export revenues are from the 1,200 firms registered with the STPI and software-related special economic zones.

Eighty-four software units will be set up in the state this fiscal, including 35 with foreign equity, two Indian majors and 47 small and medium enterprises, with a combined investment of Rs.465 crore.

In spite of voluntary attrition and lay-offs in the BPO sector, employment in the software industry in the state increased by 34,000 to 554,000 in 2008-09.

Agencies

Do Indian IT firms vie for $11.4-billion domestic market?

With the IT clients in the U.S., Europe and Japan tightening their purse strings, Indian IT companies are scrambling to raise their share of the Indian software and IT services market, which industry body Nasscom values at around Rs 57,200 crore ($11.4 billion), reported Mint.

Mumbai-based TCS and Bangalore-based Infosys, India's largest and second largest IT service exporters, respectively, have set themselves the target of earning $1 billion, or around Rs.5,000 crore, in revenue from the domestic market in the next three to four years. Wipro wants to raise its India focus, as does mid-sized firm MindTree. In March, Employees' State Insurance Corporation, a government of India agency that provides health insurance to 10 million workers, had awarded a Rs.1,182 crore information-technology (IT) project to Wipro, which outbid other biggies like Infosys and Wipro to clinch this deal.

Adding allure to the domestic market is the plans by the sectors like government, energy and utilities, telecom, banking and finance to step up their IT spending. Customers in the US and Europe have traditionally made up as much as 80% of revenue earned by Indian exporters of software and related services.

A late 2008 report by research firm Gartner says that the Indian IT software and services segment, excluding business process outsourcing, is expected to grow at an annual pace of almost 20 percent to touch $13.2 billion by 2012.

TCS earns around $500 million (Rs2,500 crore), or nearly 8 percent of its total revenue, from Indian clients. "We have a base of key clients and solutions portfolio. We have made investments and have people, business and clients. We will accelerate all of this," a TCS spokesperson said.

However, the worry at TCS is that "India, like other emerging markets, is volatile and most business is project-based and not annuity based and hence there is a certain element of uncertainty," the spokesperson added.

Meanwhile, Infosys earns less than 2 percent of its revenue (or less than Rs400 crore) from the domestic market. "The market is very large, and has matured over a period of time," said Binod HR, head of the India business unit of Infosys. He said a "big challenge" is that Indian customers are very price-sensitive.

Wipro is one of the largest system integrators in India and, according to Springboard Research, has the second largest share of the domestic market after IBM.

P.K. Gopalkrishnan, Senior Vice-President and India business head IT services of Bangalore-based MindTree said the company earns up to 5 percent of its revenue from India and aims to double it by 2014.

Increasing the domestic market share would, however, not be easy. It entails competing with global technology firms such as IBM which, according to a late 2008 report by research firm IDC, commands a 10 percent share of the Indian market. IBM is the market leader and earns revenue of around Rs 5,700 crore from the Indian market.

Agencies

Is TCS likely to lay off 1,300 staffers?

India’s biggest software exporter by sales, Tata Consultancy Services (TCS), will lay off less than a percent of its global workforce over the next few months, as these employees failed to meet performance standards, a company spokesperson said.

This roughly works out to 1,300. The company has a total employee count of around 1.3 lakh.

IT companies are adopting stringent appraisal, cost-trimming and productivity-boosting measures as they grapple with the global economic slow down.

TCS employees said on condition of anonymity that lay-offs have started at the company’s development centres in Chennai, where over 200 employees have been asked to leave in the last fortnight .

When contacted, a member of the TCS corporate communication team confirmed the development but did not put a number or place to it.

Agencies

Global crisis to hit China more than India, says ADB

Multilateral lending agency Asian Development Bank (ADB) on Saturday said that the impact of global financial meltdown will be much more on China than India as the Chinese economy is heavily dependent on exports.

"The extent of slowdown in China is much bigger than India because Chinese economy is more dependent on exports than Indian economy," ADB President Haruhiko Kuroda said in an interview to a news channel, adding that both China and India were not in recession.

Developing countries will have to restructure their economy and generate domestic demand besides sustaining high growth to avoid poverty, he said.

Even if the global economy recovers from the worst recession, global economic structure will be changed considerably and particularly Asian countries cannot rely on exports, he said.

Emerging economies will slowdown with negative impact on poor and Countries will have to sustain high growth to avoid poverty, Kuroda said.

The global downturn may be deeper and the recovery take longer than earlier expected, he said adding, developing Asia would not have miracle growth and further slowdown this year will be inevitable. However, Indian economy was expected to grow at around 7 per cent.

The Bank plans issuing 9-10 billion dollar bonds in the market this year. "In the next 12 months we can easily raise 9 to 10 billion dollar from capital markets Recently we issued one billion dollar bond and market response was very good", Kuroda said.

ADB yesterday announced stepping up its lending operations by several billion dollars to help Asian nations tide over the crisis.

In addition, the bank would increase the size of trade facilitation programme from $150 million to $1 billion in 2009.

The Manila-based bank facing resource constraint, however, has requested shareholders for an immediate and substantial capital increase for steps to mitigate the severity of the economic crisis in the region.

Agencies

As turmoil continues technology exports to miss target

Exports of software and services in the year to March will be sharply below an earlier forecast as the global slowdown dents Nine trends for IT in 2009 outsourcing, expanding 16-17 percent to about $47 billion, an industry body said.

The National Association of Software and Service Companies (Nasscom) said on Wednesday the export-driven sector's growth had been adversely impacted by the global financial crisis, deepening recessions, and currency fluctuations.

It had earlier forecast exports growth would range from 21-24 percent this fiscal year. "It was an exciting first half, 24 percent growth much in line with industry estimates," Nasscom chairman Ganesh Natarajan said. "In the second half, we have seen a rapid decline."

Total revenue of the software and back-office outsourcing sector, including the earnings from the domestic market, is expected to rise to $60 billion this year, down from the association's July forecast of $62-$64 billion.

It expects the sector's export revenues to rise to $60-$62 billion in the fiscal year 2010/11.
India's export-driven outsourcing companies have thrived for years by bagging contracts from overseas clients, helped by a large pool of English-speaking engineering workforce and cheaper wages.

But an economic slowdown in the United States, which accounts for more than half of the sector's export revenue, and turmoil in the global financial sector have halted the sector's scorching pace of growth.

The sector's export earnings posted growth of 29 percent to $40.4 billion in the fiscal year to March 2008.

The revelation of a massive accounting fraud at leading outsourcer Satyam Computer Services has added to the gloomy outlook for the sector, which accounts for more than 5 percent of India's gross domestic product.

Indian software firms such as Tata Consultancy Services, Infosys Technologies and Wipro provide solutions like system integration, application development, supply chain designing and back-office services.

The firms are expanding in Europe, Asia and the Middle East to lower their dependence on the United States.

Agencies

Will Japanese production plunge amid global slump?

Japanese production fell at the fastest rate on record in November as firms closed factories and cut jobs due to slumping demand brought on by the global economic crisis, according to data out Friday.

Industrial output in the world's second largest economy plunged a record 8.1 percent in November from the previous month, the ministry of economy, trade and industry said.

It was the biggest drop since the ministry began releasing output statistics in 1953 and was much worse than market forecasts of a 6.7% fall.

Production is likely to continue falling, with the ministry expecting an 8.0% drop in December and another 2.1% decline in January, as the auto industry feels the pinch.

"Overall, production is rapidly falling," the ministry said.

Unemployment meanwhile rose to 3.9% in November, worsening 0.2 percentage points from the previous month, the internal affairs ministry said.

The figure was slightly below average market forecasts of 4.0%.

The number of people out of work increased by 100,000 from a year earlier to a total of 2.56 million.

The data came as brand-name Japanese manufacturers, including Toyota Motor Corp., Sony Corp. and Canon Inc., lower production and eliminate jobs to adjust to the slump in overseas demand for their exports.

The job cuts have targeted mainly people on limited-term contracts or those who were dispatched from temp agencies.

The labour ministry said that a total of 85,012 temporary or dispatch workers have already lost their jobs or know they will be laid off by March.

The figure doubled in a month, reflecting the rapid deterioration of the employment environment for people without permanent contracts, a health ministry official said.

In other data, Japan said that core consumer prices rose 1.0 percent in November from a year earlier although they eased by 0.8 percent from the previous month.

Core consumer prices have been rising for more than a year, albeit at a slower pace than before as global energy prices come down.

Japan for a decade battled deflation, or falling prices, which sapped growth from the economy.

Source: Agencies

Over 65,000 jems and jewellery workers may be laid-off

The cgems and jewellery industry has already laid-off 65,000 workers and might be forced to lay-off a like number in the next two months, an industry official said on Tuesday.

"The Indian gems and jewellery sector was forced to lay-off 65,000 workers between August-October. Due to the ongoing economic slowdown and slump in demand, there could be a further lay-off of 65,000 workers in the next two months," Gems and Jewellery Export Promotion Council's (GJEPC) Chairman, Vasant Mehta, told reporters here.

The sector has also been afflicted by a significant dip of 34.25 per cent in exports in November, Mehta said.

There was a danger of many units shutting down, he warned, adding that by January, the exact number of units closing down would be known.

India's gems and jewellery sector contributes 55 per cent of the world's export in terms of value and over 75 per cent by carats and number of pieces.

In November, the sector witnessed a decline in exports by 34.25 per cent at USD 987.10 million from $1,501.27 million during the year-ago period, he said.

"At the manufacturing level, exports of cut and polished diamonds are down by 20.18 per cent as compared to the same period last year," he said.

The gems and jewellery industry witnessed a drop of over 20 per cent in its order books during April-October as compared to the same period last year.

The situation could be much worse in November and December, he said.

Source: Agencies

Rs 300,000cr package to boost Indian economy

The government on Sunday announced major tax cuts across the board to boost demand and allocated additional funds and incentives for exports, housing, textile and infrastructure to stimulate the economy, hit by the global financial crisis.

"The government has been concerned about the impact of global financial crisis on the Indian economy
and a number of steps have been taken to deal with this problem," an official statement said.

The package, coming on the back of fresh monetary measures announced by the RBI on Saturday, includes a four per cent cut in ad-valoram duty across the board, to boost additional spending, besides enhanced credit for exporters, along with a Rs 10,000 crore mop up for India Infrastructure Finance Company.

The measures include additional plan expenditure up to Rs 20,000 crore in current year; total spending in four months till March expected at Rs 300,000 crore. A series of steps to boost exports; Rs 350 crore additional funds for export incentives; back-up guarantee to ECGC for up to Rs 350 crore; to be allowed refund of services in some areas.

The package also includes import duty on Naptha for use in power sector as well as export duty on iron ore to be eliminated. India Infrastructure Finance Company to raise Rs 10,000 crore through tax-free bonds by March 2009. PSU banks to soon announce package for borrowers of home loans upto Rs 20 lakh. An across-the-board cut on ad valorem rate to encourage additional spending; additional Rs 1,400 crore for textile sector.

Source: Agencies

'India will remain second-fastest growing economy'

India faces a difficult situation because of the global financial crisis and may even witness a slowdown, but its economy was nowhere near a recession, Finance Minister P. Chidambaram said .

'A recession is defined as two successive quarters of contraction of GDP (gross domestic product). I wish to emphasise that India is nowhere near a recession,' Chidambaram told the annual Economic Editor's Conference.

He said the financial crisis that has enveloped the world since 2007 had become worse with many rich nations like Germany, Japan, Britain and the Netherlands officially in recession, and many more, including the US and France, expected to join them soon.

'In our view, we may expect a moderation in growth rate in the current year to a level between 7 and 8 percent. But India would still be the second fastest growing, large economy in the world,' Chidambaram added.

India still faces a difficult situation, he said but promised every possible fiscal and monetary measure to contain the impact of the global crisis on the domestic economy.

According to the finance minister, sectors like manufacturing, communications, trade, agriculture and construction that have been the major drivers of the Indian economy in the past, were likely to see a moderation of growth.

As a result, India needed more investment and quicker implementation of projects covering roads, ports, airports, power, education, health and skill development to spur growth, he said.
'Increasing expenditure in the infrastructure sector is an important part of the counter cyclical measures that are being contemplated to address the impact of the global slowdown,' he said.
'On the whole, the general outlook continues to be one of cautious optimism.'

Chidambaram also said that while the previous National Democratic Alliance (NDA) government was claiming high economic growth rate during its regime, the reality was far removed.
'At best, the growth rate during that period was modest. In particular, 2002-03 recorded the lowest growth rate after the beginning of the reforms in 1991-92,' he said, while listing the growth rates since 1997-98.

'As a consequence, the growth rate in 2003-04 appears impressive. But what is important is the average for that period. The average was only 5.7 percent.'

The finance minister said India's external sector, too, continued to be robust and reflected the strengths of the economy in 2007-08. 'In the current fiscal, merchandise trade data is available for April-September 2008. Exports and imports have registered an impressive growth of 30.9 percent and 38.6 percent, respectively,' he said.

He said there was a deceleration, but that was being addressed by diversifying exports to other markets. 'For example, during the first quarter of this financial year there has been an increase in the share of India's exports to China, Singapore, the Netherlands and Saudi Arabia.'
Source: Agencies

$1.5 trillion package for China's economy

Projects planned by provincial governments will add an additional 10 trillion yuan ($1.464 trillion) to the value of China's economic stimulus package, state television said on Sunday, even as the country's premier called on businesses to keep up their confidence.

The central government earlier this month announced a 4 trillion yuan stimulus package, including rail and infrastructure projects as well as increased social spending, as China strives to offset a sharp drop in demand for the exports which fuel its economy.

The People's Bank of China will need to pay more attention to the structural adjustment of the economy, as it combats the impact of the global financial crisis, governor Zhou Xiaochuan said in remarks published on the central bank's website Sunday.

He called for "more understanding of the financial requirements of the restructuring" and reiterated that small and medium enterprises, the service sector, energy-efficient projects and rural projects were priorities for financial support.

Despite strong talk of boosting China's domestic consumption, details of specific new projects and areas of spending are only slowly emerging.

Source: Agencies

Textile cos to axe five lakh employees

Even as the Indian government is getting ready to undertake a nationwide survey of over 800 companies to find out the exact job losses in India due to the global financial crisis, the first report of pink slips is out.

According to estimates of the textile ministry, there will be job losses of about five lakh in the next five months. This was disclosed by commerce secretary GK Pillai on the sidelines of a government-industry interaction organised by Ficci.

In a presentation made before the commerce secretary, Shishir Jaipuria, deputy chairman, Confederation of Indian Textiles Industry, said the growth of the textile sector fell from 5.2% in April-September 2007 to a minuscule 0.3% in the same period this fiscal.

He said the textiles and clothing industry employs 35 million workers directly, adding that already 7 lakh jobs are estimated to have been lost and another 5 lakh would lose jobs by March 2009.

Financial results of 50 major textile companies listed in the Bombay Stock Exchange shows that though turnover increased, profits became negative in the second quarter this year. In the remaining last two quarters, even turnover will decline, he warned. Smaller units are already suffering significant production loss, Jaipuria added.

For instance, the profitability of renowned companies like Bombay Dyeing fell from (-)370% in the first quarter over the same quarter last year, to (-)828% in the second quarter as against last year’s Q2.

Over 50% of textile products manufactured in the country is being exported. US, EU and Japan constitute over 60% of our textiles exports. All the three countries are in a recession mode.

US’s import of textile products from India during January-August 2008 declined by 1.56% in value terms, compared to the same period of 2007. For garments, the decline was higher at 4.8%. The imports demand of Indian textiles in EU and Japan is declining on similar trend, though data is not available yet.

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