Samsung to open second plant in India

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Looking at the present industrial trend the first thing which comes
to mind is the Darwin's theory " Survival of the fittest". Only the
Companies having the zeal for quality, price competance and custumer
satisfaction can survive in present market scenario in almost any
sector of bussiness.The south korean major Samsung electronics
declaration that it is going to start a new venture in south india
in near future does supports the survival theory. From an annonymous
brand in India in 1995 to the market leader position in 2006 does
takes a lot of efforts and grit.

Positive impacts:

The company has so far invested 150 million dollars at the noida
facility, in uttar pradesh. Not to mention that employement
oppertunities and vendor development are a few tangible benefits
that are generated due to the presence of a market leader in state,
also the intangible benefits like Best quality product at most
competance price with exempler custumer support services are also
noteworthy. As Samsung India is the hub for Samsung's south west
asia region, the local talent also gets the oppertunity to work with
the best in industry and to get the acclaim at international arena.
Also, as the world is heading towards free trade, Indians should
look to it as an oppertunity to raise its level to compete for the
rest of world by lowering the manufacturing cost so that more
bussiness houses are attracted to shift towards indian market to
invest for other manufacturing facilities. Mr. Ravinder Zutsi's
remark that exports from the Indian subsidiary were to tune the
Rs.100 crore in 2005 and were expected to touch Rs 150 crore this
year clearly make a note that indian manufacturing sector is at its
flourish and this positive trend has to be maintained further in
near future.

Negative Impacts:

With the rise of foreign companies snaching the market share, Indian
companies in respective sectors seem to lose their identity. But the
only solution to this is that Indian companies will also have to
sharpen their technological skills and should invest more in R&D so
that they are also able to stand in front of these International
players rather than to follow anachronicle methods of production.

Bottom line:

With the announcent of 2nd production facility in India, Samsung is
ushering in a new era for Indian base as a Manufacturing hub, which
will speeden up the countries pace to compete up with the other
countries like China ,Malaysia & Hong Kong which are supposed to be
the front runners in cheap production with cutting edge
technological facilities.

AMIT G

India offers more duty cuts to ASEAN

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Free Market economy has been the buzz word that has been driving indian trade policy over the last 15 years and the country yesterday showed the interest and the commitment it has got towards the concept. The announcement of tariff cuts by Indian trade and commerce minister Mr.Kamalanath, highlights the importance India gives to the ASEAN in terms of trade. The asean which is a regional trading block is a consortium of the far-east countries. The announcement by the honoured minister is laudable for many but is quite a catastrophe for some others. Tariff cuts on agro based products are a serious threat to the local industry, so are tariff cuts in other areas like textiles. Indian farming is largely indigenous and does not make much use of the modern technology. In light of the above stated reasons the decision to lower the tariffs is a dangerous game that India is playing and to favour one side of the argument is only being baised.

Looking at the positive side of things, the tariff cuts are a good sign of things to come in the future. India has shown it's commitment to keep the talks alive by rising the number of products out of the tariff cuts to 94p.c from 69 p.c last year. The decision by the commerce ministry is largely influenced by the fact that the trade between the two countries has risen to a high figure of $17bn but still is very less compared to the amount of trade between ASEAN and the United States which is of the order of $132Bn. It can be seen from the above facts that India is eyeing the huge gains that the trade between the two groups can offer and is ready to forefit a bit from it's side. The fastly growing Indian middle class and the plans by major companies like Reliance to enter the retail sector are also major catalysts in lowerng the tariff cuts. There is a large and yet untapped market in india which the trade can leverage upon.

On the negative side of things the decision posses a great challenge to the government to protect it's own industries and agriculture. A 40 p.c cut on tariff is not something that pleases the average farmer and it would not be easy for the government to implement it. Tea estates are largely labour intensive. In this context the move to reduce the tariff by half on black tea and other varities is something that needs to be discussed more. Tariff cuts on Textiles is also of concern as the Indian textile industry has just learned to make use of advanced technology and is still in a growing stage. However, The government has a timeperiod of 5 years a la WTO agreements and major steps have to be taken to make both the retail and textile sectors to be competent.

To Sum it up, It was a brave, visionary and commendable move from India to lower the tariff rates. This agreement if implemented would bolster the trade withe countries like Malysia which augument for 70p.c of India's oil needs. But having said all this the government should realize that the opening up of market comes at a price and sufficient and quick measures are required to prevent the price from becoming too high.

Prasad

Crackdown on colas can hurt investement in India!

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After 3 years, Capital based CSE has again tests positive the famous
Cola brand of India and cosequently the denate over COLA ban is
again making news.. SOon after the announce ment of CSE that the
famous COLA brand has exceed the limit of permissible pesticdes in
the contents. the news was hot and even the traces have been seen in
the indian Parliament. Around six ates of India has banned cola
partaially or fully lead by KErala who was the first to introduce
ban .

The reaction has taken no time to come up and within few hrs The
American Government and Business leaders had warned India the the
move to ban Cola will lead to thwart the investors in India. Indian
business leaders and Association were coherent with their american
counterparts in criticizing the move.
Actually In India there is no any written specification for the
permisible limit of pesticides in the ingredients of soft drink .
The CSE , which is claiming that pesticide limeit is higher than
permissible is taking the latest draft into account , which is nt
yet a law. So in the wake of just a private NGO's test the move of
Govt sounds hurried move.
However if the limit is crossed and its nt the violation of law ,
still its condemnable. Indian soft drink market is of 2 bn USD. and
a bn plus populated country cant be just ignored in terms of Quality
and these MNCs sud understand this.
It s still remains to be seen that the present fizz over to make
unfizzy cola giants will sustain and will give us some fruitful
results or it will be just a fizz and wioll cool down with time as
it had been three yrs back.

AMIT

NO FDI in retail sector !

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Much awaited FDI in retail is again in abeyance and If commerce minister Mr. Kamal nath to be beleived, there seems no sign of nod for the FDI in retail sector until its going to create technological advancement and betterment of indian workers at large scale.
Indian retail sector is one of the booming sector in India of late and Foreign giants have already having close watch on the indian govt's move on the issue.
The big players in the retalil like wallmart have already expressed their willingness to take on the indian players which are blossoming and gathering momentum lead by Pantaloons group and the likes.
Now the statement of Mr. Kamal nath is a move which can shatter the dreams Foreign investors.
If the FDI in retail is allowed it will give consumers of India a wide option to choose from and the healthy competition will sure make the sector as buyers market. This will wrk like it has wrked in other sectors so there is no need to be be sceptic. The move will ensure betterment and it will generate employment opportunities.
However, the small players in the field may get adversely affected and consequently there may be shortage of some unskilled employment. Also the technology stagnation is the area to be concern. sinnce the fibished good r nt going to evolve the technology.
Till date only the single brand retail has been allowed . now it will be interesting to see the move of Indian govt. in days to come , which will decide the future of indian retail sector.

AMit

India a step closer to Rupee convertibility

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In the wake of submission of The report by S. S. Tarapore committee on fuller capital account convertibility to the Reserve Bank of India (RBI) on Monday the debate over full convertiblity of Rupee is again on.
some say we have been thgirved ovewr the time and now as the Indian multinationals r ready to take on the world time is arrived for full convertiblity of rupee. The hunger of indian multinational is increasing for M&A of world's companies, so its high time to leverage their move by allowing full convertiblity.
However the other side of coin is not to allow this in a hurry and RBi sud keep close watch on this issue. The inflation rate is already high and Fiscal deficit is also fluctuating so these two areas should be considered before being liberal on this issue.
To sum it up , nothing can be better except the quote of Assocham President Anil K. Agarwal, who said, "CAC is a welcome goal, but India needs to tread on this path with care as the country faces a large number of challenges relating to CAC which include macroeconomic scenario, capital mobility and foreign exchange reserves

India Rejects $100 Laptop Project

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Well, yet here again we have an exciting issue on the table which
though doesn't need a debate at all, its still there. So for the
sake of it being there let me present my point of view on it.
Needless to say, the much-hyped about issue on `one laptop per
child' is entirely baseless, at least in a developing country like
India. It is a surprise in fact that the planning commission had
actually done lots of paper work on this program put forth by Prof
Nicholas Negroponte who is very well known for his innovative ideas
in the field of education. However, as said by Aswari Ghatage, a
student at Mount Carmel College, the professors at MIT are far too
removed to feel the reality on India, it is only too true that a
program such as OLPC despite being just too good and innovative for
students has no real value in actuality unless these students are
provided with the basic needs. Here are some of the very basic
reasons why this program if put in place in India in the recent
times is going to have a fiasco:
1. more than half the Indian population communicates and learns
in vernacular languages and hence the introduction of laptops is
going to be of little use to these majority of children.
2. the children who still depend on the government to provide
them their basic primary education are hardly capable enough to even
buy books or uniform for their school. How are they going to be able
to pay for the maintenance and internet connectivity in case they do
receive the laptops?
3. giving these children computer education is another hurdle
since their parents themselves are computer illiterates.
4. now comes the shipping and delivery of these laptops. We all
know just too well how the Indian system works. Even in the
instances of natural disasters, only a small part of the relief
reaches the victims, so how can it be ensured that the supply of
laptops to all the areas would be penetrated enough with so much of
corruption through out the way right from the workers to high level
officials?
Well these are just some of the superficial apprehensions by one and
all, if the program is ever put into place, more problems which have
not yet been even thought of will pop up from nowhere. So the stand
taken by our government is completely justified. Also the positive
point to this issue is its capability of creating innovativeness and
creativeness in students as young children are far too curious and
fast learners through creative ideas such as these. But that only
becomes possible when they are already proficient with using the
computers easily that these ideas can actually be realized. So
programs such as these will actually be a big hit in developed
countries but for the still developing ones, that's far too a reach.
The good times for Indians is yet to come and soon. Till then we
need to wait patiently and be rationale towards all the decisions
without hurrying into things.

Singh P.