HMT Pinjore Tractor Manufacturing Unit Likely for Shut Down Shortly

Over five decades after its inception, the massive tractor manufacturing unit of the Hindustan Machine Tools (HMT), a PSU located on the outskirts of Chandigarh, in Pinjore, in Haryana, is likely to shut down its operations. 

It was the first HMT unit to be established away from its Bengaluru factory way back in 1964. A communique from Union Heavy Industries Minister Anant G Geete to the state government has asked Haryana to take over the entire land of the unit.

This would come in lieu of settling dues of voluntary retirement of its employees and for dealing with other outstanding liabilities.

The ministry’s response follows a communication by the state government, which had asked the ministry to transfer surplus land of the unit to the state for creation of another industrial estate.

Now, in the wake of a different, perhaps, unexpected response from the Centre, the state government is viewing the matter afresh. But the decision to shut down the unit may not be easy, given its political ramifications and the effect it will have on the 1,800 employees.

It is also being met with stiff resistance from politicians, including those of the ruling party who are against any such decision to shut down the plant, even as the ministry has said it could consider attractive compensations for the workers, before the unit is shut.

HMT has been in the red for several years now, and from a high production of nearly 19,000 tractors at one time in 1999, the production currently has dropped to about 10 per cent of its optimum high production.

HMT fell flat to competition and poor strategies. Around 12 years ago, the Centre had approved Rs 1,083 crore for its revival, but to no avail. The situation was so bad that nearly 1,500 employees were not paid salaries for 14 months until October.  

Agencies

Online Retailer Snapdeal to Invest in Logistics & Tech to Surpass Completion

Online marketplace Snapdeal, backed by Japan's SoftBank Group Corp and others, will spend more on logistics and technology to better compete with Flipkart and Amazon's Indian unit, its co-founder said recently.

Shopping online is becoming more popular in India due to the rising use of cheaper smartphones and e-commerce firms are struggling to cope with the growing demand and make faster deliveries in different parts of the country.

The e-commerce market in India is expected to grow to $220 billion in the value of goods sold by 2025, up from an expected $11 billion this year, Bank of America Merrill Lynch said in a recent report.

Flush with $500 million from a funding round in August, led by China's Alibaba, SoftBank and Foxconn , Snapdeal is now looking to expand its services.

One area Snapdeal will focus on is to cut delivery times by investing in better data analytics and demand forecasting, co-founder Rohit Bansal told the media.

"We have done over 10 acquisitions and investments in the last one year, almost all of them in the field of technology or supply chain and payments," he said. "With all these investments we have been able to reduce our delivery times by 70 per cent in the last one year."

Quick and cheap delivery is important to be able to win over customers in a competitive industry in which companies are burning through substantial cash to grow.

Snapdeal, which had $4.5 billion in Gross Merchandise Volumes (GMV), a measure of value of goods and services sold, by August, bought mobile wallet company FreeCharge in April for around $400 million.

It has also spent around $35 million to buy about 50 per cent stake in logistics services company GoJavas.

Bansal said that Snapdeal had received interest in part of its stake in FreeCharge to raise funds for the mobile wallet company, but declined to comment further.

"Our view is that in five years from today 10 percent of India's consumption will happen online, not just products, but all consumption, and we want to build a technology ecosystem for that," Bansal said.

Agencies

Over 100 Million Users for Reliance Jio in First Year of Launch

Reliance Jio Infocomm Ltd (RJIL) has set a target of reaching 100 million users in the first year of its launch, an ambitious one as considering the total 3G subscribers in India is at about 93 million.

Moreover, the 3G subscribers were garnered over a period of five years, following the 2010 spectrum auction, even though it took another 2-3 years for a complete rollout. The total 3G penetration stands at just 9 per cent of the total mobile subscriber base of 981 million, according to a recent study by brokerage firm CLSA.

“Today, nobody believes Jio will have 100 million customers in our first year. But we will accomplish it because we believe so,” Reliance Industries Ltd (RIL) Chairman and Managing Director Mukesh Ambani said, answering an employee’s question during the launch of the company’s 4G services in Navi Mumbai.

On Sunday, RJIL, a subsidiary of RIL, has launched its 4G and digital services at a gala event attended by nearly 35,000 Reliance Group employees and their families. The event was also like webcast across 1,100 locations simultaneously over RJIL network, enabling a total of 1.5 lakh employees logging on.

“With the employee launch, we will bring in lakhs of people on to the Jio network,” Ambani said.

With the launch of the services, RJIL intends to put India among the top 10 countries in terms of internet and mobile broadband penetration in the “next few years”, he said, adding at present, India ranks about 150 among the 230 countries. “Jio is conceived to change this,” he added.

Stating that India has the youngest population in the world, Ambani said that RJIL intends to tap the opportunity to transform the lives of 1.3 billion Indians.

 “The world is at the beginning of a digital revolution. Anything and everything that can go digital is going digital at an exponential rate, faster than what you and I can imagine. Whether it’s entertainment, commerce, healthcare, education, governance, life is going digital,” Ambani said as the reasons for the group’s foray into the digital arena.

“Through the ages, information and knowledge have driven humanities’ progress. Life itself has relied on information to progress. Our genetic code, our DNA, the basis of our evolution is nothing but information,” he added.

Reliance Jio’s service will include video streaming, music streaming, money payments and video calling.

Agencies

WB Reports India Retains as Largest Remittances Receiving Country in 2015

India became the largest remittances receiving country at US$72 billion this year followed by China at US$64 billion, the World Bank said in a report.

The US emerged as the largest remittance source country with an estimated US$56 billion in outward flows in 2014.

"India was the largest remittance receiving country, with an estimated US$72 billion in 2015, followed by China (US$64 billion), and the Philippines (US$30 billion)," the World Bank said in a report.

In outward flow, the US was followed by Saudi Arabia (US$37 billion), and Russia (US$33 billion) in 2014, the Bank said in the report.

Noting that the number of international migrants is expected to surpass 250 million this year, an all-time high, as people search for economic opportunity, the Migration and Remittances Factbook 2016 said the fast growing developing countries have increasingly become a strong magnet for people from other parts of the developing world.

International migrants will send US$601 billion to their families in their home countries this year, with developing countries receiving US$441 billion, the report produced by the World Bank Group's Global Knowledge Partnership on Migration and Development (KNOMAD) initiative said.

"At more than three times the size of development aid, international migrants' remittances provide a lifeline for millions of households in developing countries. In addition, migrants hold more than US$500 billion in annual savings," it said.

"Together, remittances and migrant savings offer a substantial source of financing for development projects that can improve lives and livelihoods in developing countries," said Dilip Ratha, co-author of the Factbook.

The top 10 migrant destination countries are the US, Saudi Arabia, Germany, Russia, the UAE, UK, France, Canada, Spain and Australia.

The top 10 migrant source countries are India, Mexico, Russia, China, Bangladesh, Pakistan, the Philippines, Afghanistan, Ukraine, and UK.

Mexico-US was the largest migration corridor in the world, accounting for 13 million migrants in 2013.

Russia-Ukraine was the second largest, followed by Bangladesh-India, and Ukraine-Russia.

"There is ample research to demonstrate that migration, both of highly-skilled and low skilled workers, generates numerous benefits for receiving and sending countries. The diaspora of developing countries and return migration can be a source of capital, trade, investment, knowledge, and technology transfers," said Sonia Plaza, co-author of the Factbook. 

Agencies

Harvard Research Forecast Projects India's Economy to be Fastest Over Next 10 Yrs

India, with a projected annual growth rate of 7 per cent, has the potential to be the world's fastest growing economy over the coming decade, surging ahead of its South Asian economic rival China that will continue to see a slowdown, Harvard researchers said in new forecast.

"India has the potential to be the fastest growing economy over the coming decade... India tops the global list for predicted annual growth rate for the coming decade, at 7.0 per cent," new growth projections presented by researchers at the Centre for International Development (CID) at Harvard University showed.

"This far outpaces projections for its northern neighbour and economic rival, China, which the researchers expect to face a continued slowdown to 4.3 per cent growth annually to 2024, the report said.

South Asia and East Africa have the greatest potential for "rapid growth" as oil economies and other commodity-driven economies face the slowest growth outlook, it said.

"India has made important gains in productive capabilities, allowing it to diversify its exports into more complex products, including pharmaceuticals, vehicles, even electronics," said Ricardo Hausmann, Professor of the Practice of Economic Development at Harvard Kennedy School and CID director. Hausmann noted these gains in economic complexity have historically translated into higher incomes.

"China has already realised many of these gains, doubling per capita income in less than a decade. We expect that India's recent gains in complexity, coupled with its ability to continue improving it will drive higher incomes, positioning India to lead global economic growth over the coming decade," he said.

The CID data predicted that growth in emerging markets will continue to outpace that of advanced economies, though the gap is closing. CID is also bullish on East Africa, with Uganda, Tanzania and Kenya ranking in the top 10, with all predicted to grow at least 5.5 per cent annually.

The growth forecast also looks favourably on Southeast Asia, where the Philippines, Malaysia, Indonesia and Vietnam look to drive growth well above global averages. Growth in advanced economies remains slow by comparison, though it has risen slightly in the projections in recent years.

The US is expected to grow at 2.8 per cent annually to 2024, with higher growth predicted in the United Kingdom (3.2 per cent) and Spain (3.4 per cent), and slower growth in Italy (1.8 per cent) and Germany (0.35 per cent).

The United Nations has also predicted that India will continue to be the fastest growing economy in the world in 2016 and 2017, projected to grow by 7.3 per cent next year and 7.5 per cent the year after amid a global order that will see persistent macroeconomic uncertainties, diminished trade flows and stagnant investment.

Agencies

$8.4 Bn Funding for Over 1000 Indian Startups Deals in 2015

Making it a year of startups, Indian and foreign investors have pumped in a whopping $8.4 billion in new ventures including eCommerce platforms in 2015 through close to 1,000 deals, even as questions have begun to be asked about their hefty valuations.

Those opening the purse for Indian startups included industry titans like Ratan Tata and N R Narayana Murthy as also marquee global investors like Alibaba and Softbank.

According to data compiled by domestic technology and startup blog trak.in, as many as 936 deals worth over $8.4 billion have been inked this year — up from 304 deals worth $5 billion that took place in 2014.

The industry is looking at a promising 2016, though experts and even the investors anticipate correction on the valuation side. The sectors to watch out for include financial technology, healthcare and enterprise technology, among others.

Also, the focus might shift a bit away from eCommerce companies towards some new areas, including agriculture.

This year, the eCommerce sector, led by e-retailers like Flipkart and Snapdeal, and the taxi-hailing app Ola, dominated the startup investments space.

Many of these firms commanded very high valuations, with marquee investors like Softbank and Alibaba, among others, doling out top dollar.

“The technology and eCommerce sectors have been in the limelight in 2015, and our country is the fastest-growing startup ecosystem in the world, right now,” Indian Angel Network (IAN) president Padmaja Ruparel said.

“Eleven of the 68 ‘unicorns’ globally, (companies that are valued at over $1 billion) are of Indian origin,” she added.

However, a debate has begun over the high valuations at which many companies have received funding.

Several industry titans, including former Tata group chief Ratan Tata, Infosys founder NR Narayana Murthy and techie-tuned angel investor TV Mohandas Pai, have questioned the high price eCommerce companies are commanding for parting stakes.

Tata, who himself has personal investments in more than a dozen startups, took a dig earlier this year at the fledgling sector, saying “valuations” and not “evaluations” are driving the play.

Pai also believes that only about 10 per cent of the startups will succeed over the next few years, and about 25 per cent will stay afloat, while the rest are bound to fail, leading to consolidation.

Ruparel pointed out that following the meteoric rise in the first half of 2015, valuations have become more grounded in the second half, and investors are also more keen to find out the business parameters before backing a company.

Agencies

Andhra's Visakhapatnam Gets Microsoft India’s Centre of Excellence

The Andhra Pradesh government today said Microsoft India will be setting up a Centre of Excellence in Visakhapatnam as part of its digital inclusion drive in the state, besides sharpening focus on raising productivity.

The technology giant signed an MoU with the Andhra Pradesh government in deployment and use of information and communications technologies to offer better citizen services in the state, an official release said.

Andhra Pradesh Chief Minister N Chandrababu Naidu hosted a breakfast meeting for Microsoft CEO Satya Nadella -- who is currently on a visit to Hyderabad -- at his residence today.

The meeting lasted for 80 minutes, during which Nadella assured the state government of total cooperation in utilisation of cloud data for improving citizen services.

"He (Nadella) has also agreed to set up a Centre for Excellence in Visakhapatnam. He promised to visit Anantapur district during his next visit," the statement said.

According to the MoU, the state government will use technical knowledge from Microsoft India, which will support building of up to three proof-of-concept (POC) solutions to apply Microsoft Azure Machine Learning and Advanced Visualisation in education, agriculture and e-citizen services, an official release said.

"These POC solutions will be built and deployed to address specific problems within each of the fields to achieve better outcome for the state. It would use the lab method for data gathering, analysis, predictive analysis and policy planning."

Reaffirming its commitment to supporting the government's initiatives for cloud adoption and improving citizen services, Microsoft India said it will continue to engage and train the government's key IT executives on Microsoft technologies such as Cloud, Mobility and appropriate Microsoft Technology stack.

The company will also deliver an exclusive workshop to the government's key administrative officers on improving productivity by using Microsoft technologies, it added. 

Agencies