Cover Story
- Ever since the prize was instituted in 1895, only four Indians have won the prize after India’s independence— Amartya Kumar Sen, Subrahmanyan Chandrasekhar, Mother Teresa and Har Gobind Khorana.
- India needs to make the transition from incremental to breakthrough innovation in the market—like Tata Motors appears to have done with its ultra low-cost car, Nano. Also needed is closer interaction between industry and academia.
- A resurgent India is slowly, but surely, making its presence felt in global trade. Since 2004, its share in world trade has gone up significantly.
- India @60, growing at over 9 per cent, has missed not just scientists and engineers in the last couple of years. It has equally acutely felt the shortage of trained drivers, masons, carpenters, electricians and the like.
- Of the Fortune 500 companies, just seven are Indian. There isn’t a single Indian company in the top 100. The highest ranked Indian company is a state-owned enterprise, IndianOil Corporation, which comes in at the 116th position.
From the editor
Imagine 14 years into the future. The year is 2022. Independent India turns 75. At least 30 Indian companies are on the Fortune 100 list; India accounts for 10 per cent of global trade; it has a base of 200 million college graduates; and is a chief source of all global innovations. In an exclusive article written specially for Business Today, C. K. Prahalad, who is one of the world's best-known and most respected management thinkers, lists six possibilities and goes on to show how India could, indeed, achieve them. The flexible fund manager
Dynamic fund of funds switch between asset classes depending on market conditions. But are they good investments? In a wobbly stock market, look for companies that have delivered decent results this earnings season. The top performers category-wise. A flexible new healthcare plan offers the advantage of adding more family members later."Follow an asset allocation strategy"
Recently, ICICI Prudential Life Insurance has added an asset allocation product called the Life Stage plan that automatically allocates between equity and debt according to your age, and risk profile. Clifford Alvares spoke to Shikha Sharma, Managing Director and CEO, on new products and the need for asset allocation. When interest rates were low, many homeowners overborrowed. But, they are now finding it difficult to cope with the increased monthly instalments. How to survive the interest rate hikes. Too much of a good thing
There may be too many malls in India. Around 600 malls are in various stages of construction across the country and over 120 of them are already in operation, according to various industry estimates. After Daiichi Sankyo’s purchase of Ranbaxy Labs, Teva Pharma, the world’s largest generics company, acquired Barr Pharma, the US’ fourth largest generics firm. There are two questions on pharma analysts’ lips these days: Who’s next? Are Indian generics players targets for pharma MNCs? With an estimated 7.5 per cent market share, Samsung is still way behind Nokia, which makes one out of every two mobile phones sold in India. But in the six-odd months, things have slowly begun to change. Tarun Khanna, Jorge Paulo Lemann Professor at Harvard Business School (HBS) suggested that the growth of entrepreneurship in India and China could actually “help both countries get out of the mess they are in and solve problems that governments have failed to over the last 40 years Internet companies such as Google are investing billions of dollars in setting up massive data centres and struggling to control soaring power usage. A tech start-up to tackle energy use by data centres. Erasmic’s takeover by Accel will create a stronger venture firm. The nagging issue of managing provident fund (PF) savings of 40 million workers, of both government and organised sectors, has ended in a win-win fashion. ICICI Prudential, HSBC, Reliance Capital and State Bank of India (SBI) have been appointed as the fund managers. Private pension managers may deliver better returns. Developers are refusing to admit it, but they are in trouble. Smaller developers are also getting affected by the downturn, having been forced to defer their IPOs due to adverse market sentiments. BMW is happy with its first-year India performance. It has already made a start towards more expansion. Like its German rivals, Audi and Mercedes, it has expanded into the lucrative Punjab market. Billionaire investor Nicolas Berggruen is on the prowl. A 3G policy gives telecom players something to look forward to. The telecom companies are betting on 3G’s far more efficient net-works to handle the growth of voice telephony, which is expected to reach 750 million Indians by 2011. As the last set of financial results for the first quarter of fiscal 2008-09 trickled in, the ‘tick tock’ got louder, and analysts were fearing the worst—that the time bomb of foreign exchange losses of corporate India was waiting to explode. Blackstone Asia’s CIO is not unduly spooked by falling markets. Punita Kumar Sinha has seen it all—the bust-up in Indian stocks in the mid-90s, and of course the technology-led crash of 2000. Rupert Murdoch wants the FDI limit in print to be hiked. He is not content with being just a 26 per cent partner in the print business in India. Even as the world waits expectantly for the Nano, farmers who sold their land for the project now want it back. Will the world’s cheapest car be late coming? ICICI Prudential AMC has been raking it in. With assets of Rs 54,237 crore as on June 30, ICICI Prudential AMC is the second largest mutual fund in the country. The AMC is also an advisor to $2 billion worth of offshore funds of Prudential Plc. Side-stepping the Olympics, Taj aims for tourist spots in China. Pension promise
It does not require any great knowledge in banking to know who is delivering the higher rate of interest to depositors—the Employees’ Provident Fund Organisation (EPFO) or commercial/cooperative banks. The last few years have conclusively demonstrated that the long-term structural story of India has changed for the better. And as India muscles its way into the developed world over the next decade, the more it will need world-class infrastructural support. The potential to become a far more powerful and prosperous nation existed back then, and it exists now. What it requires, as management guru C.K. Prahalad writes so eloquently in our cover story, is not analysis but imagination. The BT 50 index
$9 trillion (Rs 387 lakh crore): Oil revenues Gulf countries will earn by 2020 if the prices remain at $100 per barrel Even as the middle class is coming to terms with yet another round of interest rate hikes by the central bank, there are early indications that there’s more in store. The RBI has clearly indicated that inflation will continue to remain a key concern due to high crude and food prices. Global market research firm Synovate polled 7,000 women across India, United States, Brazil, Singapore, South Korea, Canada, Bulgaria, Spain and South Africa on their idea of beauty. Excerpts:At last, some good news on crude prices
Crude oil prices are now finally showing signs of softening. Analysts attribute this to a strengthening US dollar and signs of a weaker demand for crude. Jet Airways has declared a large profit of Rs 143 crore for the first quarter ended June, but most of it is the result of the way it now depreciates its smaller Boeing 737 and ATR planes. After the heady days of 40 per cent-plus increments and jumping jobs every six months, the buoyant IT industry is currently in the midst of a harsh reality check The asset quality of retail loans in india has weakened in recent months, a CRISIL report says. The contributing factors: the rising proportion of unsecured loans, increasing exposure to high-risk customers, hardening interest rates, and a dip in credit standards during 2004-07.Mumbai expensive? You must be joking
Mumbai, Delhi, Chennai and Bangalore are all costlier for expatriates compared to last year, says the latest Cost of Living Survey by global human resource consultancy firm Mercer.Doha Round: Dialogue of the deaf
The bone of contention between India and the US turned out to be an emergency measure known as Special Safeguard Mechanism (SSM)—that will come into play in the eventuality of a surge in farm imports. The two sides could not agree on the numbers. The Indian Economy is being buffeted by several adverse developments, so it’s small wonder that corporations are feeling low these days. The government is feeling the pinch of the slowdown in industrial growth—it is now the turn of indirect indirect tax collections to be impacted. The Beijing Olympic games are around the corner, but advertisers are largely ignoring the event. The mood at DD is also low and officials admit that barely a few brands have trickled in and “maybe the mood will pick up sometime down the line”."BPOs are getting commoditised"
David F. Dougherty, CEO OF Convergys, one of the world’s largest BPO vendors, took time out from meeting employees and business partners to speak to BT’s Rahul Sachitanand. Excerpts: The fortnight’s burning question. Following the rate hikes, can india still achieve at least 8 per cent gdp growth? Inflation is a bugbear that continues to give mandarins in the economic ministries sleepless nights. The latest figures show it at 11.98 per cent for the week ended July 19. Sub-normal rainfall in large parts of India can push inflation to 14 per cent. The biggest risks in power generation are the availability of fuel, its pricing and transportation. Not surprisingly, power producers in the country are pursuing options in green power. What happened to Taneja aerospace and Aviation’s (TAAL’s) plans of building light planes in India? Well, the plans are on track. It has been building the six-seater twin-engine P68 Series since 1996, making it the first private sector company in India to make light aircraft. “If blocking means not accepting whatever the developed countries say, so be it”Kamal Nath, Commerce Minister, on the failure of the WTO talks in Geneva, to Associated Press Human resources departments consider it their duty to uphold personal and organisational ethics, but according to findings from a survey commissioned by India's largest staffing company, TeamLease, executives are yet to find their feet on this front. The last mile chase
The television distribution business is no longer a tangled mess like the cable wires criss-crossing cities. Investments are flowing in, and big operators are gobbling up last mile players in a bid to consolidate. Serum institue has perfected the art of low-cost, high-quality vaccines.BT takes a look at the company’s DNA. Falling oil prices, coupled with expectations of a last-gasp burst of reform from a desperately cobbled-together coalition, offer a glimmer of a bear market on its last leg. But the by-now-familiar twin demons of rising inflation and interest rates cloud a promising picture. Virendra Verma reports.What was your fund manager doing...
Not since the technology crash of 2000 have an equity fund manager's investment strategy been tested—and the perils of running a concentrated portfolio exposed. When the stock market was booming, dozens of Indian companies issued foreign currency convertible bonds (FCCBs) to raise cheap capital. But with stock prices crashing and conversion coming up, they are in a soup.India Inc. wakes up to corporate frauds
India Inc. loses crores of rupees to frauds, most of which are not even reported. But now, companies are belatedly waking up to this problem. Suman Layak reports. Fraud plagues World Bank aided health projects India Inc. draw up anti-fraud policies Barmer's tryst with oil
The entry of large oil and gas companies is changing this desert district in Rajasthan and promising its people a better life. Barmer's economy seems to be thriving. Kapil Bajaj reports. Inclusive capitalism: The Fabindia wayDream factories of SriperumbudurTata's goodwill gesture in Jharkhand A mighty spark
This is a book that will make experts and laymen alike look afresh at sustainable development. Prahalad's plan
An India that's home to 30 of Fortune 100 companies, the world’s largest pool of technically-trained manpower, and Nobel Prize winners in arts, science and literature? That’s management guru C.K. Prahalad’s dream for India@75, and he’s got a plan how to get there. A Business Today exclusive. By 2017, India’s energy requirement is expected to be 100 GW more than previously estimated. That’s why it is imperative for India to have nuclear power as a critical component of its energy basket. Shalini S. Dagar does a threadbare analysis. More new jobs with nuke-deal spin-off Crude at $200 a barrel? Perhaps it’s that prospect that has convinced a clutch of Indian businessmen that exploring and producing this commodity that’s getting scarcer by the minute is a lucrative venture. But how many of them will hit pay dirt? Anand Adhikari finds out. Oil: A ticking time bomb Risk taker
Cricket has always been his passion. Though N. Srinivasan has been involved with the sport for many years in various administrative capacities, he had kept it away from his business. But this year, he decided to bid for, and bagged, the Indian Premier League’s Chennai franchise for $91 million (Rs 391 crore). The newsmaker
Starring: Rupert Murdoch, Chairman, News Corp; DMRC’s E. Sreedharan; Mohan Sekar, President and COO, Collabera; Unilever’s Vindi Banga; HUL’s Harish Manwani; NDTV’s Rohini Nilekani; and Commerce Minister Kamal Nath. How we did it
Only those companies that are listed on both BSE and NSE and have more than Rs 250 crore in market capitalisation (as on June 30, 2008) were selected. A total of 332 companies cleared this stage.India's most investor friendly companies
Our fifth annual survey of the companies who have managed to put a smile on their shareholders’ faces and delighted them the most. 3.5G is also coming
What is HSDPA? HSDPA stands for High-Speed Downlink Packet Access and it is the latest generation of radio technology used by mobile operators. What is it? It is a free SMS service that Peekamo has launched in India. It works on any mobile phone capable of text messaging or on any data-enabled PC or Mac anywhere in the world. SEBI cracks the whip
Market regulator SEBI is out to demonstrate it means business. It is now verifying whether foreign institutional investors (FIIs) are adhering to the new norms on the issue of participatory notes (PNs). Real Estate Mutual Funds (REMFs) have finally been cleared by the authorities with a formal nod of approval from the Finance Ministry. The government is gearing up to radically alter its approach to disinvestment. With the Left out of the equation, moves are afoot to offload equity in some big PSUs. OIL (Oil India) and hydro-power generator NHPC are on top of the list. Jagmohan Dalmiya
He may never be cricket’s comeback man, but with his recent election as President of the Cricket Association of Bengal, Jagmohan Dalmiya has proved to be cricket administration’s comeback man. Deal watch
Every month, we bring you a listing of the biggest deals struck by Indian companies in India and abroad. Our partner: global professional services firm Ernst & Young. Here are the deals that were struck in July 2008. It pays to have a career in taxation
Exposure to international taxation gives you a headstart. As the reality of a slowdown bites the hitherto fast-growing IT industry, employees and employers need to realign their goals. My lunch with Warren Buffett
Mohnish Pabrai and his friend Guy Spier paid $650,100 to dine with the world’s best-known investor. This is what they took out from their three-hour lunch. A Business Today exclusive. Macho machines
Being fit is not just about bulging biceps.Try these new gizmos at state-of-the-art gyms in your city to feel on top of the world. It’s boom time for the luxury market yet again. Check out what’s new in the stores this fortnight. Fuelled by movie and music stars, waistcoats have made a huge comeback.We take a look at three different ways to wear designer waistcoats. He is 36, single, and a workaholic.We invited Shailesh Rao, the suave Managing Director of Google’s India arm for a drink, only to discover an American citizen who’s an Indian at heart; one who loves his dosa, adores Amitabh Bachchan and has a collection of Amar Chitra Katha comics. Love crabmeat but don’t know how the chefs manage to tame those claws? Executive Chef Walter Lanfranchi tells you how to make a great crab dish at home. The French were in for a rude shock. A jury, drawn from the most hallowed establishments of French wine snobbery, rated two Californian newbies as the best in their category. The French media ignored the event. To put it simply, these are the best yachts that you can buy in India. We cruised on the Arabian Sea to check out some of these fabulous water babies that the super-rich crave to own. We have heard of a car pool. But a yacht pool? That’s exactly what India’s first yacht timeshare club is aiming to do.The world's most luxurious yachts
There are yachts and then there are the really extravagant, gigantic, luxury yachts.We take a look at who owns the finest things to set sail on high seas. We take a look at two gripping books—a work of fiction and another based on true events—which take us through the thrilling, though often horrifying, journey of life in a world where terror and terrorist attacks are everyday occurrences. Chuck that black leather belt when you wear your jeans. Let these casual woven belts weave their magic this season. They are the latest and most exclusive line from the House of Vuitton and are already creating a buzz among LV addicts the world over.We tell you why The Monogramouflage and the Mahina make for prized possessions India has had its share of electric vehicles, ranging from the Bajaj and Mahindra three-wheelers to the cute and chic, Reva city car. The world over, electric vehicles have been made in all shapes and sizes, from city buses to fancy sports cars Where do you go when you’re an immensely successful rock star and have been there and done all that you ever dreamed of? Well, you start a side-project, which is nothing like your day job. This issue, we take a look at three side-projects that are getting as much attention as the real thing. Why does a watch cost the sky? Or Rs 67 lakh in this case? We decided to take apart de Grisogono’s new creation, the Instrumento Grande, to find out just that. It’s small, it’s expensive and not the ultimate in comfort either. But there’s something about the new Fiat 500 that will make you fall in love. Powerful kings and rulers of France made it their second home as did celebrated painters. The twin towns of Moretsur-Loing and Fontainebleau, surrounded by forests, rivers, palaces and rich in history, are gems waiting to be discovered, barely an hour away from the centre of Paris. Playing conditions at Birkdale, for most of this year's British Open, were similar. You might argue that the players here were the world’s best but you really have to sample those conditions firsthand to appreciate the show put up by Padraig Harrington, and more so by Greg Norman, at age 53. International TV series like Twin Peaks and Friends have long enthralled us. In this issue, we take a look at three modern TV hits that are now available on DVD When it comes to a true cheese legend, Australian Will Studd has few competitors. An award-winning author, Studd was named a Maitre Fromager (Master of Cheese) by France’s Guild des Fromagers. We caught up with him when he was in Delhi to talk about iconic varieties of cheese, and the wines that go with them. Recording a song isn’t just about getting the sound right or having a great voice. We learnt how it’s done at Mumbai’s state-of-the-art Blue Frog Studios, to let you in on a few secrets. It's raining banks
Banks are proliferating at a rapid pace in the Sivaganga district of Tamil Nadu. Over the last two years, 28 new branches have been opened and five more are likely to commence operations soon. N. Madhavan checks out if this would improve the quality of life of the people in this district. 
