According to experts’ definition, emerging markets are those markets with untapped potential for expansion. Naturally, most of the developing countries come under the category of emerging markets. With India itself being classified as an emerging nation with a fast growing economy, Indian exporters have to look at other emerging markets as targets.

Advantages of Investing in Emerging Markets

As mentioned earlier, a lot of potential is yet to be tapped in emerging markets. The demand in growing economies is constantly on the rise. Exporters can make use of this growing demand and generate business. Another advantage is that you won’t need a lot of time and investment to establish a business in an emerging market. All you need to do is provide quality products at competitive prices and you can carve a niche for yourself in the market.

There are a number of countries with growing economies that Indian exporters can target. This article will give you an idea about the top 5 new or emerging markets for Indian exporters.

South Korea

South Korea is one of the fastest growing economies in the world. Although there isn’t any latest figure available to back this statement, we can safely say that the country has recorded growth figures that place it among the top three nations in Asia. The government of South Korea has policies in place that emphasize on research, development, innovation, and growth. Also, all these policies are further reinforced by generous subsidies offered by the government. There are several leading brands in the technology sector that are based in South Korea. So, if Indian exporters can assess the condition of the market clearly, they can find a number of opportunities to expand their business.

Philippines

The Philippines is on so many investors’ radars that the government is unable to control the appreciation of its currency due to foreign investment. This is perhaps the reason why there are measures in place to ensure that foreign investment is regulated and the currency appreciation is steadied. According to Bloomberg, the Peso, Philippines’ national currency, is the best performing Asian currency in the world. The main reason for this is foreign investment and Indian exporters should take maximum advantage of this growing market.

Indonesia

Indonesia is a real powerhouse when it comes to growth. In fact, a recent survey showed that more than 85% of Indonesian consumers believe that their country has what it takes to be a global superpower. The nation’s consumer market recently overtook the Indian consumer market as the most bullish in the world. This alone makes Indonesia one of the top choices for Indian exporters, considering Indonesia is also an Asian country. In the G-20, Indonesia has the second highest growth rate, a healthy 4.5%, which surpasses that of China. The best part is that this rate was maintained during the years of recession also.

Mexico

The only LATAM entrant to this list is Mexico. The growth rate of Mexico is so high that it challenged the presence of Chinese products in the US market. Factories in Mexico have been very proactive in recent times and are exporting record quantities of goods to the US and around the world. A record 700,000 jobs were created in the year of 2010 alone, showing how much potential the country has. The two major detrimental factors to the Mexican economy, corruption and drug trafficking, have come down significantly in recent times. The government has also been proactive in inviting exporters and businessmen from around the world to set up shop in the country.

Thailand

Thailand has an economy that registers the second highest rate of growth in the South East Asia. Post the flood and destruction, investors have taken an interest in rebuilding the country and making it count. The potential was always there, but the flood and changes in the government policies for investors opened the gates of development in the country. The government of Thailand has also taken a lot of measures to boost the minimum wages of an average Thai citizen, which contributes to development of the nation as a whole.

Sparta Strategy assists Indian exporters identify new markets for their products by working closely with our partners in the target region. Our service encompass, market intelligence reports, identifying the right trade fair and industry expo’s,  building a pipeline of prospective partners in the region in addition to due diligence on the shortlisted partners.

What’s Different in Your Region from India?

Gone are the days when Indian companies struggled for infrastructure and advanced technological facilities. Today, India is on par with the technological growth and almost all the latest technologies are available. So, you need to provide something that the Indian companies don’t get in India. This will give them a reason to come out of their comfort zone and expand their operations to your region.

Research and Development Facilities

One of the facilities that Indian companies lack in their country is research and development. Although there are a number of premier research centers in India, companies in India still prefer state-of-the-art facilities outside the country. This is to take advantage of the latest advancements in technologies, something that requires a little time to be implemented in India.

Improved Business Models

When companies design business and forecast models, the economy of the country where they want to set up their business plays a major part. For example, if you are providing services to a company that is located offshore, you will have to pay extra taxes and other surcharges. All these are factors that reduce your profits. On the other hand, if you are situated where the client company is located, all these surplus charges are avoided. Even though you have to make an initial investment, in the long run, the investment is a very small amount compared to the surplus charges you had to bear if your business was still set up in India.

The aforementioned is only one of the examples of the different business models that you can offer to Indian companies. Highlight the points that show how their company can benefit from moving to your region. Show them the business models that you have designed and the forecasts you have in mind. These are very strong factors that can influence Indian companies to invest in your region.

Association with Contemporaries

There are a number of Indian companies that have not yet explored their full potential. This is because of the lack of exposure. Association with more established contemporaries will not only elevate the status of the company but also give them many more opportunities to grow. For example, the association of Instagram with Facebook only enhanced the net worth of the company and also contributed to its growth. In the same way, if you can identify Indian companies with potential and show them what they can gain by moving into your region, you are more likely to get an approval.

Advantages that the Market Can Offer

The Indian market is different and unique like any other market. You can highlight the advantages of the market in your region when you try to attract Indian companies towards it. Although the company might be doing well where it is established, the founders and investors will not say ‘no’ to expansion into a potentially lucrative market. Before approaching them with the offer, conduct a market research of your own. Show this to the people in charge and highlight what they stand to gain by moving into your region. This will definitely have a positive impact on your proposal.

Workforce

The local talent pool is vital for any company’s growth. If your region has one or more reputed universities which have a history of producing top-class graduates, it will be one of the very strong reasons for the Indian company to move into your region. Although there is no lack of talent in India, companies are always looking for something new and exciting that will provide them with the edge over their competitors. And that can happen if fresh talent is infused into the company culture on a regular basis.

Sparta Strategy has been advising the world’s most promising regions attract larger FDI from a major growing source market; India with be spoke investor targeting solutions based on key target industries. Our investment promotion solutions have earned us the reputation of being a leader in this domain of attracting Indian companies to strong developing and emerging regions.

Bloom Consulting is proud to announce the release of the 2012 Bloom Consulting Country Branding Ranking©, now even more accurate with the incorporation of Online Search Demand (OSD).

Overall, the USA retains its’ top spot and Asian countries reinforce their position in the top 25.

In Trade, despite 13 out of the top 25 coming from Europe, the 2012 Ranking markedly showed strong growth distributed among all continents. Four other noticeable improvements were Brazil (11), Australia (12), India (15) and Kazakhstan (19) joined for the first time the top 25 performers.

For Tourism, Asia, in particular performed extremely well in the 2012 Ranking. Eight Asian countries finished in the top 25, with China as number four. Aided by both strong tourism receipts and CBS Ratings ©, Thailand (6) and Malaysia (14) significantly improved from last year. For the first time, Macao was evaluated as an individual country and finished with a bang at number eight.  A notable absence was Japan.

Please Download Both Rankings For TRADE and TOURISM here:http://www.bloom-consulting.com/en/country-brands-ranking

About the Ranking and Methodology

The 2012 Bloom Consulting Country Branding Ranking© is a thorough study measuring the effectiveness of each country’s brand strategy, separately evaluating the trade and tourism country brand strategies, and comprising of 160 and 161 countries respectively. The Ranking relies on hard facts, which include the economic performance and the economic growth of countries. For tourism these are represented by the annual intake and the annual growth rate of global tourist receipts. For trade these are characterized by the annual intake and the annual growth rate of global FDI inflow. This hard data is accompanied by soft facts, thereby measuring the economic impact of each country’s brand strategy.

Furthermore, this year marks the incorporation of Online Search Demand (OSD), for the first time, into a ranking of this type. The OSD evaluates the gap between what countries are promoting (supply) and what investors and tourists are searching for (demand). Bloom Consulting uses the OSD along with an analysis of each country’s brand strategy to assign each nation a Country Brand Strategy (CBS) Rating©. This identifies the accuracy match between supply and demand and allows Bloom Consulting to assess the best country brands.

Please see an illustration on how the Ranking is calculated:

About Bloom Consulting

Bloom Consulting is a strategy consultancy specialized in country branding.Currently Bloom Consulting has offices in:São Paulo, Mumbai, Lisbon, Madrid (headquarters) and Los Angeles and R&D centers in Tokyo and London.  

Bloom Consulting works closely with presidents, monarchs, ministers and institutions in order to define their Country Brand strategy, establish their vision, and implement it. Bloom’s clients include the Bulgarian, Latvian, Polish, Portuguese and Spanish governments, and also regions such as Madrid, Castilla y Leon in Spain, and center and the southwest regions of Portugal.

José Filipe Torres founded Bloom Consulting in 2003 and is a regular spokesperson at conferences and universities worldwide. Both The Economist and Forbes have interviewed Mr Torres, where he was identified as one of the top 3 country branding experts in the world.

More information about Bloom Consulting

www.bloom-consulting.com

More information about Jose Filipe Torres

http://en.wikipedia.org/wiki/Jos%C3%A9_Filipe_Torres

http://www.youtube.com/watch?v=b6JFnKg-peY

Contact Information:

PRESS                                                            OTHER ENQUIRIES           

Anastasia Karpenko                                        Gonzalo Vilar

corporate@bloom-consulting.com                  gvilar@bloom-consulting.com

Bloom Consulting

Monte Esquinza 14 6 D Ext

28010 – Madrid

SPAIN

Phone : +34 913 080 286

Logical, conclusive , extension of our current services portfolio…these were some of the words we used most when we first brainstormed for what now we call Fast Offices.

All these definitions were true, after all at Sparta Strategy we worked with companies who were seeking solutions on the most ideal locations to start or expand their India business. Our experience however was more inclined to Non technology sectors and a a few tech companies as well.

Fast Offices,in my view was primarily born out of  the need to find office space for ourselves, dealing with brokers was a harrowing experience especially in Mumbai and albeit its the same for a small and mid market firm.

In situations where we were asked to find office space for our clients, seeking a remuneration from the BIG BROKERAGE Boys for getting them clients was indeed a bitter experience as well.

This was the time we could use our knowledge of corporate locations, our intelligence in inward investment and our existing relationships with Indian and global firms to better use and thereby Fast Offices.

Fast Offices currently in alpha phase is an office discovery platform across 10 major office markets in India where prospective tenants can quickly navigate offices based on their preferences and move in “FAST” er. No paid listings by developers, no pop ups,no in your face and mostly irritating adverts in some fuzzy designs.

Finding an office, shouldn’t suck…anymore

1. Tamil Nadu (4906.74 MW) 

The spectacular growth of wind farms in Tamil Nadu is attributable to early efforts of Government to assess wind resource potential, set up demonstration farms and the conducive policies adopted to attract private investment.  As a result of combination of various favorable factors, private investments came in a big way, starting with the first wind electric generator of 55 kW capacities in Muppandal in 1990 in the private sector.

The capacity of single wind electric generator which was less than 100 kW initially has gone up gradually to 2.0 MW in 2004. The total installed capacity has also increased to 4287 MW including 17 MW under demonstration programme as on 31.3.2009. Tamil Nadu continues to maintain # 1 position in the country in wind power with 42% of total installed capacity in India

2. Maharashtra (2077.70 MW)

Maharashtra is second only to Tamil Nadu in terms of generating capacity. Suzlon has been heavily involved. Suzlon operates what was once Asia’s largest wind farm, the Vankusawade Wind Park (201 MW), near the Koyna reservoir in Satara district of Maharashtra. It has the highest installed capacity in India and energy consumption per consumer. The Maharashtra State Electricity Board (MSEB) syatem has a peak demand of about 10,000 MW. The Maharashtra State Development Agency, established by the state government has been taking various initiatives to increase the power generation through renewable.

3. Gujarat (1863.64 MW)

The Gujarat government, which is banking heavily on wind power, has identified Samana as an ideal location for installation of 450 turbines that can generate a total of 360 MW. To encourage investment in wind energy development in the state, the government has introduced a raft of incentives including a higher wind energy tariff. Samana has a high tension transmission grid and electricity generated by wind turbines can be fed into it. For this purpose, a substation at Sadodar has been installed. Both projects are being executed by Enercon Ltd, a joint venture between Enercon of Germany and Mumbai-based Mehra group.

The state of Gujarat has one of the fastest growing economies in India. However, this growth has largely bypassed certain areas of the state. The district of Kutch, the second largest district of Gujarat, reflects this uneven progress. Kutch is predominantly rural with 67% of the population living in rural areas. In addition, 23.3 % of the population falls below the official poverty line.

4. Karnataka (1472.75 MW)

There are many small wind farms in Karnataka, making it one of the states in India which has a high number of wind mill farms. Chitradurga, Gadag are some of the districts where there are a large number of Windmills. Chitradurga alone has over 20,000 wind turbines. The 13.2 MW Arasinagundi (ARA) and 16.5 MW Anaburu (ANA) wind farms are ACCIONA’S first in India. Located in the Davangere district (Karnataka State), they have a total installed capacity of 29.7 MW and comprise a total 18 Vestas 1.65MW wind turbines supplied by Vestas Wind Technology India Pvt. Ltd.

Wind power harnessing is area specific. Wind is the fastest-growing clean energy sector of the renewable. Much of the technology for wind power already exists. Advanced technologies like “Floating wind power plants” will be explored in the west coast. There is a potential of about 13000 MW for the development of wind power plants in the state. Wind potential areas in the state are Chitradurga, Gadag, Chikmaglur, Bellary, Davangere, Koppal, Bijapur, Bagalkot, Belgaum etc Districts.

5. Rajasthan (1088.37 MW)

In an independent development, cement major ACC Ltd has proposed to set up a new wind power project in Rajasthan with a capacity of around 11 MW. Expected to cost around 60 crore, the wind farm will meet the power requirements of the company’s Lakheri cement unit where capacity was raised from 0.9 million tpa to 1.5 million tpa through a modernisation plan. For ACC, this would be the second wind power project after the 9 mW farm at Udayathoor in Tirunelvelli district of Tamil Nadu Rajasthan is emerging as an important destination for new wind farms, although it is currently not amongst the top five states in terms of installed capacity. The following features make Rajasthan a preferred state for wind energy.

• The state in its western part blessed with abundant natural resource i.e. optimum sunshine  and wind
• Assured power evacuation arrangements in place. Setting up 400 / 220 / 132 KV network for solar and wind energy based power plants in progress.
• Sparsely populated. Revenue land is available in abundance
• Land is allocated at reserve price under G O R Policy Density of population – 165 per sq. km
• Rich in mineral resources, viz. marble, granite, rock   phosphate, zinc, lignite, Lime stone steel grade etc.
• Rich culture, historical monuments popular tourist spots
• Close to National Capital – Vast potential for economic development
• Per Capita electricity availability – 561 units
• Vast potential for Power Generation from Wind, Solar, Biomass, Petroleum and Natural Gas in Western Rajasthan.

Offshore Wind Energy is the next frontier in Wind Energy Expansion and Chinese companies like Ming Yang Wind Power, A-Power are aggressively investing to gain an initial advantage. Indian Companies on the other hand lack resources and ambition to become big players. With the entry of South Korean Shipbuilders and companies like Northrop Gruman, India will soon face massive competition. Wind Energy Industry in India looks to have a bleak future and will mainly become a technology buyer with small production bases established by foreign firms. Here is a list of Wind Energy Companies in India.

1) Suzlon Energy – Suzlon Energy is the biggest Wind Energy Company by far with 4-5 Gigawatts of WTG Capacity per year. Its subsidiaries Hansen Transmission and Repower are also big players in the Wind Energy in Europe. The Company has seen its revenues and profits take a huge hit in recent times but have been recovering slowly.

2) RRB Energy – The Company has a long history and manufactures Wind Turbines at its plants in Tamil Nadu. The Company has a capacity of 300 MW which it is expanding to 700 MW. The Company makes only 2 models with power rating of 600 Kw and 1.8 MW. Merill Lynch has made a small investment in this company.

3) NEPC India – This Company was one of the wind energy heavyweights and a stock market darling earlier. However it no longer remains an active player in the Indian market .Heavy Debt and Bad Management drove to this company to the ground despite being a pioneer in the Indian Wind Power Market.

4) Auro Mira Energy – The Company is more of a Green Utility rather than a full fledged WEG manufacturer. It has made plans to manufacture Wind Turbines in the future. It has attracted funds from Baring and IFC to push forward its Green Plans.

5) Regen Powertech – It is a small scale WTG Supplier like RRB Energy which recently set up a small 300 MW manufacturing facility in Tada, Andhra Pradesh recently. The company licenses technology from Vensys to manufacture 1.5 MW gearless Wind Turbines. The company has managed to supply both big and small wind farms over the last 2 years. The company is supported by the PE arm of Future Group.

6) WinWind – The company is not exactly a domestic company rather one with a Finnish Origin. It is owned by the Abu Dhabi Masdar, Siva Group and the government of Finland. It has recently established a 1000 MW capacity in Venga, Tamil Nadu and also has a 500 MW plant in Finland as well. The company plans to produce 3 MW Turbines at its Indian plant as well.

7) Pioneer Wincon – The Company is a JV between the Pioneer Group and Wincon of Denmark. It makes small 250 KW Turbines and is a bit player with 30 years of operations in India. The Company remains a small static player in the Wind Energy Market of India.

8) Chiranjeevi Wind Energy – A Small bit player like Pioneer Wincon which engages mostly in the sale of small 250 KW Wind Turbines. Like Pioneer Wincon it has sold a number of these Turbines to small companies mainly in the Southern Part of India.

9) Lietnar Shriram Limited – The Company is a 50:50 JV betwen the Shriram Group of India and Lietnar of Italy. The company makes gearless turbines of 1.5 MW capacities and has supplied to small farms in Maharashtra. The company has a major in-house customer in the form of Orient Green Power which is building a 300 MW farm in Tamil Nadu using Lietnar Shriram Wind Turbines.

10) Kenersys – The Company is part of the Baba Kalyani Group which is a major forgings manufacturer in India. It was bought over in 2007, when the Kalyani Group and PE firm First Reserve bought over the German company RSB Consult. The Company mainly makes 2 and 2.5 MW turbines and has production facilities both in India and Germany. It has wind design capabilities between 1-3.6 MW and with a powerful parent; it could become a success in the future. Amongst the newer wind energy companies like Lietnar, RRB Energy, Regen and WinWind, it looks like the one with most potential.

To explore partnership opportunities in India’s wind energy sector, join us at the India Power summit 2011 at Mumbai between the 29th and 30th of September 2011.

For further information check our conference page: http://www.spartastrategy.com/event/india_power_summit.html

•SERCs have been mandated to promote renewable energy through renewable purchase obligations, which require distribution companies to source up to 10 per cent of their power from such sources.

•The key incentives for wind energy include a provision for 80 per cent accelerated depreciation in the first year, a 10-year tax holiday, income tax waiver on power sold to utilities and privileged tariffs.

•Projects that do not claim accelerated depreciation benefits are entitled to generation-based incentive of US$ 0.011 for each kWh of power sold to IPPs with capacity of more than 5 MW.

•India offers several subsidies to solar power products, such as solar lanterns, home lighting systems besides generation-based incentives of up to US$ 0.286/kWh to solar power plants.

•For small hydropower projects (less than 3 MW), incentives include concessions on customs duty, capital subsidies, 10-year tax holiday and other state-level incentives such as exemptions from sales and electricity tax and preferential tariffs.

•Incentives for biomass energy include accelerated depreciation, import duty concessions, excise duty exemption, capital subsidies and a 10-year tax holiday. Several export incentives have made India a key player in the global market for wind turbine generators (WTG) and solar photovoltaic cells and panels.

Policy Incentives

•100 per cent accelerated depreciation in the first year of the installation of projects and systems

•No excise duty on manufacture of most of the finished products

•Low import tariffs for capital equipment and most of the materials and components

•Soft loans to manufacturers and users for commercial and near commercial technologies

•Five-year tax holiday for power generation projects

•Remunerative price for grid-feeding renewable energy units under the alternate power purchase policy of state governments

•Facility for banking and wheeling of power

•Facility for third-party sale of renewable energy

•Financial incentives and subsidies for devices with high initial cost

•Involvement of women in implementation of renewable energy programmes.

Encouragement to NGOs and small entrepreneurs

•Special thrust on renewable energy in the North-Eastern region of the country; 10 per cent of planned funds earmarked for North-East for enhanced and special subsidies

•For municipal waste-to-energy projects, allotment of land on long-term basis at token lease rent and supply of municipal waste at project site free of cost In addition, the Central Government gives financial assistance to develop solar cities in the following manner:

•Up to US$ 0.12 per city for a period of five years

•Up to US$ 0.03 million for preparation of a master plan

•Up to US$ 0.03 million for institutional arrangements

•Up to US$ 0.5 million for awareness generation, capacity building and other promotional activities

•Up to US$ 0.03 million for oversight of implementation during five years. The government has created a liberal environment for foreign investment in renewable energy projects. Key highlights of the foreign investment policy are:

Permission for foreign investors to form joint ventures with Indian partners for financial and/or technical collaboration and for setting up of renewable power generation projects

•Liberalized foreign investment approval regime for easy investment and technology flows to joint ventures

•Automatic approval for proposals for up to 74 per cent foreign equity participation in a joint venture

•Permission for 100 per cent foreign equity with special approval from the Foreign Investment Promotion Board (FIPB)

•Permission for setting up liaison offices in India

•Encouragement for foreign investment in renewable energy generation projects on build-own-operate basis State governments have also announced promotional policy packages in the form of wheeling, banking and buyback guarantee in addition to considerable tariff escalations for energy from wind, co-generation, small hydro, and biomass projects. In order to promote the sector, some state governments provide concession and exemption in state sales tax and octroi. In addition, state renewable energy development agencies play a hand-holding role in the development of renewable energy projects.

For further information, you can get in touch with us at Sparta Strategy participate in the India Power summit 2011 at Mumbai on the 29th and 30th of Sepetmeber 2011. 

For more information  you could also visit our conference website:

http://www.spartastrategy.com/event/india_power_summit.html

Electricity Demand and Supply

Source: CEA

With the shortage at both the normal and the peak levels, Indian power industry does not exhibit much cyclicality. Further, with assured returns, the margins of players and their profitability is almost independent of the economic cycles. Electricity is the most important component of primary energy. India’s electricity consumption has grown at an average rate of 7.3 per cent during the period 2002-07 to about 577.9 TWh. Consumption has increased at a faster rate since 2002-03, reflecting buoyant industrial demand. Industrial consumers are the largest group of electricity consumers, followed by the domestic, agricultural and commercial consumers, in that order. India’s per capita electricity consumption increased from 178 kWh in 1985-86 to 704.4 kWh in 2007-08. Over the period, 2001-08, per capita consumption has increased at an average rate of 4.45 per cent. It is still much lower compared to the international standards.

Electricity Requirement

The demand for power is expected to increase to 975 billion kWh by 2011-12. However, at an average GDP growth rate of 8 per cent, the overall demand is expected to increase to about 1,097 billion kWh in 2011-12, including the demand from non-utilities.

Projected Requirement of Electricity

Source: IMaCS Research

The 17th Electric Power Survey (EPS) has forecast a peak demand of 152,746 MW for 2010-11. That means a capacity addition requirement of about 72,000 MW during the Eleventh Plan period. Though the target set for capacity addition during the Eleventh Plan period is 78,700 MW, only 62,000 MW is expected to be added by the end of the period.

Capacity Addition Plan

The following table provides the Eleventh Plan targets for adding generation capacity. In a reversal of the trend witnessed during the 1990s, a substantial contribution is expected from the hydropower sector. Also, the private sector is expected to account for 15 GW of the planned capacity addition of 78.7 GW during this period.

Installed Capacity Addition Plan (MW)

                         Source: CEA, IMaCS Research

Recognizing the large potential of coal reserves in the country as an economic and readily available resource, a significant proportion of the future capacity additions is expected to be based on coal. Further, to reduce the environmental impact and to increase efficiency, the strategies proposed by the power ministry include introduction of large-sized units (660-800 MW) employing the super-critical technology. The source-wise capacity addition as envisaged under Eleventh Plan period is as given below:

Additional generation capacity would require commensurate investments in transmission infrastructure as well. Huge transmission capacity enhancement is required under Phase-III of National Grid Programme, which targets an inter-regional exchange capacity of 37,700 MW by 2012. With rapid industrialization and growing power requirements, many states have decided to set up high-capacity intra-state power transmission systems. PPP model is being adopted by many utilities to attract private investment in transmission sector. The future capacity addition plan envisaged is as given in the table below:

Projected Transmission Line Length (Ckm)

Source: CEA,IMaCSResearch

Mandate for the Eleventh-Five Year Plan

Considering the continuing gap between the demand and indigenous production of crude oil and natural gas and low crude oil reserves, national oil companies and private companies are being encouraged to venture abroad. The various strategic options in this regard include focus on ventures with producing fields for the short term, equity participation as a part of reserves portfolio management, emphasis on exploration acreages for the short to medium term and promoting upstream sector services for the long term.

Planned Petroleum and Natural Gas Demand-Supply

Source: Planning Commission; P-Projected

At the beginning of the Eleventh Five-Year Plan period (2007-2012), the Planning Commission had projected a demand for gas of 279.43 million metric standard cubic meters per day (mmscmd) in the terminal year of the period, compared to 179.17 mmscmd in the first year of the Plan. The corresponding projection for increase in gas production was 63.23 bcm compared to 33.78 bcm.

Gas Production –Eleventh Five-Year Plan Projection (bcm)

Source: Planning Commission

The projected demand for natural gas is the highest for the power sector, followed by the fertiliser, petrochemicals, city gas distribution and sponge iron and steel units. Any surplus gas after allocation to these industries would be available for sale to other units.

Projected Natural Gas Demand –Eleventh Plan Period (mmscmd)

generation79.7091.20102.70114.20126.57Fertiliser41.0242.8955.9076.2676.26Citygas12.0812.9313.8314.8015.83Industrial15.0016.0517.1718.3819.66Petrochemicals25.3727.1529.0531.0833.25Others*6.006.426.877.357.86Total179.17196.64225.52262.07279.43

Source: Report of the Working Group on Petroleum & Natural Gas Sector for the Eleventh Plan

Since the demand-supply projections for gas leave a significant unmet demand of 38.22 bcm, it is evident that gas imports would increase. According to Planning Commission estimates, by the end of 2011-12, India would import about 23.75 million tones of LNG. That could still leave an unmet demand of about 10-11 bcm.

LNG Supply –Eleventh Five-Year Plan Projection (Million tonnesper annum)

Source: Planning Commission

While the demand for crude oil has been projected by the Planning Commission to be around 207 million tonnesin 2011-12, the projected domestic oil production in that year is only 39-40 million tonnes. Going by the current trends in demand for oil and domestic production, the unmet demand could be higher than projected.

Crude Oil Production –Eleventh Five-Year Plan Projections (Million tonnes)

Source: Planning Commission

Coal and lignite meet about 50% of India’s commercial energy requirements. More than 75% of the coal and lignite is consumed by the country’s power sector. Cement and steel (coking coal) are the other significant consumers. The Planning Commission’s Integrated Energy Policy anticipates a steep rise in demand for coal, particularly to meet the country’s power needs

Exploration and recovery

The Geological Survey of India, Central Mine Planning & Design Institute Ltd., and Mineral Exploration Corporation Ltd. have estimated total coal reserves at 267.21 billion tonnes as a result of exploration activities carried out at depths up to 1,200 meters.

Thus, of the estimated reserves of 267 billion tonnes, 105 billion tonnes are proved. Even on the conservative assumption of 60% recoverability for the Proved resources, about 64 billion tonnes could be recovered. This could sustain a production level of over 1,800 million tonnes per year for the next 30 years. Private-sector participation in the coal sector is restricted to joint ventures and companies that can use coal for captive purposes. If the production is greater than what is required for internal use, the balance must be sold to Coal India Ltd.

Planned coal projects

At March 31, 2009, out of a total of 701 mining projects costing more than $450,000, 411 projects stood completed (including projects which are merged, completed and merged, and where coal reserves have since been exhausted) and 160 projects were in various stages of implementation. Out of 160 ongoing projects, 125 were on schedule and 35 were delayed. Reasons include delay in environmental and forestry clearances, delay in acquisition of land and associated problems of rehabilitation, adverse geo-mining conditions and problems with law and order. Some areas of India have experienced extended periods of rebellion or insurgency.

If the power sector is required to grow at 10% per year, coal availability from domestic sources should also grow at 10%, and possibly even faster, since projections show coal supplying an increasingly large share of India’s energy. Associated ports, railways and transportation infrastructure will need to be developed accordingly. In the current scenario (2009-10), 404 million tonnes of coal are required for the power sector. The government-owned companies CIL and SCCL are able to supply 343 mt and the captive mines 20 mt. This still leaves a shortfall of 41 mt and the power companies have been advised to import 28.7 mt of coal. This shortfall is expected to persevere into the XII Plan.

Though a number of coal blocks have been allocated by the Ministry of Coal for power projects, their development has been slow, resulting in the coal shortage. Among the obstacles to coal development have been coordinated development of the rail network and a lack of other models for coal exploration and mining, such as private-sector participation through a public-private partnership.

To know more on Coal based power projects in India or to cater to this industry in India, join us at the India Power Summit 2011, India’s largest power conferences focused on promoting foreign investment in the Indian energy sector.

For further information you can get in touch with Ms. Mini Syed, at +91 22 65250 250 or email : mini.s@sparta.co.in

Major Coal based Power projects in India.

DATES: 29TH SEPTEMBER 2011 – 30TH SEPTEMBER 2011  

VENUE: ITC GRAND MARATHA – LUXURY COLLECTION. MUMBAI. INDIA

The India Power Summit 2011 will bring together senior officials and executives from the public & private sectors, including regulators, insurance firms, pension funds, bankers, private equity, sovereign wealth fund, power producers, contractors to discuss the financing and execution, the opportunities for investors, and obstacles that need to be overcome for the government’s ambitious targets to be achieved.

Organizer

Sparta Strategy, India’s leading FDI Strategy consulting firm in association with the Ministry of Power & Ministry
of renewable energy, Government of India is organizing this conference to promote Foreign direct investment in
the Indian energy sector. The Hindu Business Line, India’s leading and most reputed business daily is the
media partner to the India Power Summit 2011

Key Highlights

i. Discuss the current & future potential
ii. Identify and appraise investment opportunities
iii. Understand and evaluate the risks & costs associated
iv. Evaluate unique financing methods
v. Assess the regulatory & reform pattern
vi.An ideal CXO environment to meet decision makers from the industry
vii Participation by over 250 global & Indian companies in the power sector and investors
viii. Over 50 power focused funds & financial institutions seeking investment opportunities

A Multifaceted Event

i. 2 day sector focused Conference – 29th Sep: Conventional Energy | 30th Sep : Renewable energy
ii. 4 Interactive panel discussions
iii. Live debates
iv.Pre requested B2B meetings
v. Key note speeches by Ministers & Industry Leaders with ample networking and private meeting opportunities.

Who should attend

• ·Independent Power producers

• ·VC/PE firms

• ·Institutional Investor

• ·Renewable energy companies

• · Power equipment firms

• ·Investment Advisory

• ·  EPC firms

• · Industrial Corporations 

The summit offers immense value, networking & branding opportunities for sponsors, to know more;

Mr.Bhavesh Shah – bhavesh.s@sparta.co.in or call 91 – 22 – 65250 250

For speaking opportunities please get in touch with Mr. Sanjay Sharma – sanjay.s@sparta.co.in

For delegate registrations, please get in touch with Ms. Mini Syed – mini.s@sparta.co.in or call +91 22 65250 250

In December 2011, fDi Magazine will publish Asia-Pacific Cities of the Future, a ranking of the economic, business and financial strengths of cities across the Asia-Pacific region.

fDi wants to find those cities, large and small, with the best prospects for inward investment, economic development and business expansion.

fDi will be looking at more than 50 criteria covering everything from cost effectiveness to human resources and infrastructure.

Could your city come out on top?

fDi Magazine will also name the best city in the following categories:

• Best economic potential
• Most cost effective
• Best human resources
• Best quality of life
• Best infrastructure
• Most business friendly
• Best FDI promotion

CLOSING DATE FOR SUBMISSIONS IS WEDNESDAY 31^st AUGUST 2011

The fDi team of researchers will be benchmarking the investment potential of cities across the Asia-Pacific region. We invite investment promotion agencies, economic development units, local and regional governments to supply additional information about their city in order to help enhance their competitiveness in the rankings. There is no cost to submit your city for this ranking.

To boost your city’s results, please provide additional details regarding your city’s investment promotion.

You can enter in the following ways:

• Enter online
• Visit our dedicated rankings page to enter online

Do you want to find out what trends drove FDI in 2010, and the latest forecast for FDI in 2011? Download fDi Intelligence’s Global Outlook Report for free at www.fDiIntelligence.com/GlobalOutlook

You could also get in touch with @grainne.byrne@ft.com  T +44 (0) 20 7775 6714

or simply follow @fdi_rankings on Twitter

If in India you could also get in touch with us at Sparta Strategy, India’s leading FDI Strategy Consulting & Investment promotion support services firm.

India with an economy that’s growing at close to 8%—plus a huge market and at a time when the US and Europe are struggling with creaking growth, growing unemployment and rising debt, yet the buzz across boardrooms is that investing abroad is “at least headache-free”. They complain about frustrating delays in government approvals at all levels, primarily those related to land acquisition and the environment.

The overseas investment push by Indian companies, often seen as the assertiveness of a rising power, is increasingly spurred by difficulty finding attractive opportunities in India.

At home, rising interest rates and inflation, fierce competition in several industries, and policy gridlock amid a spate of corruption scandals that have put India’s government on the defensive have deterred investment, slowing economic growth and prompting many Indian firms to seek opportunity elsewhere.

While doing business abroad diversifies risk and opens new markets, the export of capital even as inflows slow deprives the Indian economy of investment that could add capacity and ease bottlenecks that drive inflation and crimp growth.

Inorganic growth

India Inc.’s increasingly global focus also makes it harder for equity investors to gain exposure directly to the country’s consumption-driven growth, with roughly one-third to half of revenue generated by firms in the top 50 firms comes from overseas, even though exports account for just 18% of India’s economy.

It’s worrisome that despite India’s vast opportunities across under-penetrated sectors, companies are venturing abroad for inorganic growth while this is also partly driven by rising global aspirations for Indian companies; another reason for this is a tough competitive field, made no easier by the unpredictable regulatory environment.

Foreign direct investment (FDI) by Indian firms more than doubled in the fiscal year that ended in March to $44 billion.

At the same time, inbound FDI fell by a quarter to $19.4 billion, with planned multibillion-dollar investments by South Korean steelmaker Posco and London-listed India-focused miner Vedanta Resources plagued by delays.

Within India, investment was flat on an annual basis in January-March after growing 7.8% in the previous quarter.

Indian firms have made several big-ticket overseas buys in recent years, and the huge Reliance Industries and Tata conglomerates earn more than half their revenue abroad. However, the recent mismatch in inbound and outbound investment suggests push factors are increasingly at play.

Some corporates are also factoring in a higher degree of political risk for making investments at home than abroad
With an economy growing around 8% a year, 1.2 billion people and unmet demand for everything from housing, roads and power to food and consumer goods, India is hungry for capital. Conditions on the ground, however, can make it hard to put money to work.

Indian home and personal care goods makers Godrej Consumer Products, Dabur India Ltd and Marico are searching for buys in Africa amid fierce competition inside India.

Few question India’s attractiveness as a long-term bet.

Local auto makers Maruti Suzuki and Hero Honda Motors and global giants like Ford and Hyundai Motor are adding capacity in an Indian car market that grew 30% in FY11.

Near-term sentiment is weaker. Three-quarters of leading firms have lost faith in the government and believe a governance crisis and policy limbo will hit economic growth and their investment plans, a recent survey found.

Rising domestic competition is a bigger driver of outbound investment than policy gridlock, which combined with inflation is more of a deterrent for foreign investors.

To sum it up governance issues and the policy gridlock are hitting economic growth, which is “softening quite meaningfully at the moment.”

To know more on Indian companies seeking overseas expansion, talk to our Foreign IPA/EDO services team to assist you in your efforts in attracting Indian companies to invest in your growth region.

Blackstone’s has been in the news for planning to acquire majority stakes in IT Special Economic Zones in Pune and also considerable interest again in acquiring an existing stakeholder’s pie in India’s largest IT SEZ at Bangalore.

Last week, Indiareit too announced its plans for raising a 800 Crore  rental yield fund for commercial properties across India.

If you take stock of the the office space segment in India,it’s no doubt a rapidly emerging goldmine for international investors. The growth curve has been steep and unstoppable. Office stock in India crossed 50 mn sq ft in 2004, 100 mn sq ft in 2006, 200 mn sq ft in 2009 and is expected to cross 400 mn sq ft in 2013.

IT / ITES is driving most of the growth, with nearly 50% of the transactions of investment grade office space done by IT/ITeS companies. While IT/ITeS industry has necessitated higher grades of construction, it has benefited due to the affordable rents offered at several Tier I cities of India. Over 60% of the operational investment grade offices in top seven cities currently provide space at a lease rental of less than a-dollar-per sq ft (or less than INR 45 psf), primarily in secondary and suburban locations. These locations offer large land parcels that are ideal for the development of IT/ITeS campuses.

When it comes to commercial real estate, India is being taken very seriously by the rest of the world. In that respect, we are well on the way to global integration. The Indian retail explosion, which was briefly contained by the recent economic downturn, is now in full roar again as well.

If you are seeking Office space in India, talk to our Corporate Real estate team at Sparta Strategy, India’s leading FDI Consulting firm.

Drop us an email at: tenantadvisor@sparta.co.in.

However, despite the expectations, the industry has not touched $5 billion yet – perhaps the after effects of the severe recession in 2008 are still being felt globally.

The Southern-Western Leadership
The southern region of India is slightly ahead of the western region in terms of total share of revenues, however, the south comfortably leads in the number of firms (172 vs 137). Bangalore and Hyderabad are leading the way and the recent announcement of building a cluster and incubator in Bangalore will help maintain the leadership of this region. The north cluster follows at the third spot but hopefully new clusters, especially in the NCR, will help close the gap in the future. What is revealing is, that despite possessing huge bio-resources and many leading institutions, the eastern part of India is lagging in terms of proper biotech enterprises. The states of Bihar, West Bengal, Orissa, Assam and the North East need a focused strategy to seed biotech enterprises.

There are now 362 firms in India that are focussed on some aspects of biotechnology. This is an important indicator. The vibrancy of a knowledge intensive and highly regulated industry such as biotech depends on the number of new start-up firms that are establishing and injecting fresh business ideas, solutions, and products built on innovation. What do we need to have in policy terms to say that India can treble the number of innovative biotech firms in the next five years to cross the one thousand mark? How do we make the biotech landscape investor friendly and ease the burden of establishing and operating start-ups? Indeed for the sector to grow even further several concomitant factors have to be addressed:

Streamlining Regulation: Regulation that enables innovation is the key. ABLE facilitated, as “Knowledge Partner” a regulatory session at Bangalore INDIA BIO last month. What became clear from discussions there as well as from all other forums is, that Industry will like to have a scientific evidence-based, clear and non-ambiguous, streamlined and transparent regulatory mechanism where procedural delays are minimized and technical considerations are dealt with by expert committees that are not created on an ad-hoc basis.

For India to achieve a leadership position in biotechnology, this is foremost in all sectors of biotechnology, i.e., biopharma (including diagnostics & devices), agri-biotech and industrial biotech including food & nutrition. Indeed, it goes without saying that investor confidence is directly linked to a clear and streamlined regulatory landscape.

The Future Ahead
Indian biotechnology industry is showing signs of consistent and mature growth in the 20 percent range. It has done well despite the global recession. Indian biotech firms are globalizing and strategically partnering with other firms – the Pfizer-Biocon and Glenmark-Sanofi deals are indicators of the kinds of new partnerships to emerge.

It is clear that vaccines, diagnostics and devices along with biosimilars will be key growth areas in biopharma. The agri-biotech sector is poised to grow – especially, the seed business in the area of new hybrids. Regulatory clarity in both biopharma/healthcare & agribiotech will be crucial for the future. There is a perceptible dynamism in systems biology (or BioIT) firms that are building predictive models, both disease and organ models, and enabling drug discovery research.

The growth potential of BioIT firms in India built on India’s strengths in IT and biology remains high. The CRO industry has become highly competitive and many CROs now have to show unique differentiation other than cost arbitrage. Many CROs have chosen to follow a risk-sharing model for growth to transition themselves into drug discovery firms. While this transition might take years it is a positive trend for the industry.

If you are interested in investing in India’s growing life sciences sectors, our India site selection services and Tenant advisory teams can help u identify the ideal locations and the commercial real estate facilities required to jumpstart your operations in India.

Send us your queries at india@sparta.co.in

To attract Indian biotech firms to your region, talk to our Foreign IPA/EDO services send us an email to kavan.b@sparta.co.in

The article analyses the context, barriers and policy options for the growth of the CSP industry in India.

As opposed to photovoltaic (PV) technologies, the CSP technologies use systems of mirrored concentrators to focus direct beam solar radiation to receivers that convert the heat energy to mechanical energy through a steam turbine and then into electricity.

India’s solar mission launched in January 2010 has an ambitious target of 20 GWe of installed solar power by 2022. In the first phase, 1 GW of grid-connected solar energy is targeted for 2013 with an approximate 50:50 split between CSP and PV technologies.

We believe”CSP has advantages compared to photovoltaics as it can readily incorporate thermal energy storage and/or fossil fuel boosting to provide dispatchable power,”

“The use of relatively ‘low tech’ manufacturing methods for solar collector fields, together with the use of steam turbine technologies adapted from the existing thermal power generation industry, makes the prospect of continued, rapid scale-up of CSP capacity very feasible,” it says.

Describing the solar mission as “a visionary and inspiring policy measure”, we firmly believe “there is more than enough suitable land in India with high direct beam solar resources to meet the entire nation’s electricity needs in principle”.

The regions with the highest solar resources are largely in Rajasthan and Gujarat, plus Jammu and Kashmir. “The high capital cost nature of CSP technology means that it is best to construct systems in the locations of highest solar resource even if they are away from existing infrastructure and load centres and some extra transmission losses are incurred.”

According to our own analysis, the best sites in India for locating CSP plants are in the northwest of the country. For instance, the direct normal irradiation – the portion of solar radiation that CSP plants utilize – at Jodhpur, on the edge of the Thar Desert in Rajasthan, is comparable on an annual average basis to Granada, one of the best Spanish sites.

Whilst the grid in India is extensive, there are many regions where the load density has not justified the necessary sub-stations for full grid-connection. In our view “within these non-grid-connected areas there are industrial sites with captive power generation in the megawatt range that would be candidates for small off-grid CSP systems,”

Some of the possible barriers for CSP in India are the current high cost of electricity produced, getting approvals for land, grid and services connection.

Going further we feel “for CSP to achieve significant penetration in a given market, millions of square meters of solar concentrator systems of various types along with all the supporting plant and infrastructure will need to be manufactured. Facilities and the skilled human resources to do this are needed,”

As for recommendations taken from various stakeholders to reduce the project timelines and make the solar mission a success, our findings for a country embarking on growing its involvement with CSP, a pilot plant of some kind is needed. CSP has been discussed in India for many years but there has been no significant pilot plant constructed.

A promising way to go ahead is by establishing solar parks in areas where the direct incidence solar radiation is high. The solar park concept could be applied to advantage in a manner tailored for small-scale demonstrations to facilitate commercially driven pilot plants in the 1 to 5 MW size range.

The solar mission also misses some key opportunities, for instance, energy storage is not suitably encouraged with the flat tariffs on offer. Current rules also preclude hybridization with biomass or fossil plants, pointing out that “the opportunity to provide solarised or solar enhanced fossil or biomass hybrids is one which could improve peak supply in the Indian power network”.

Going by our own research, the CSP sector is widely forecast to continue to grow at very high rates. This growth has been mainly in Spain and now increasingly in the South Western US. Now India appears to have positioned itself to play a key role in global CSP developments “provided the present measures continue and are implemented in a pragmatic manner with appropriate support for research and development, demonstration, standards and industry training”

Noting India’s strong track record of technical success in every new field that it has seriously engaged in – from wind turbines to car manufacturing – makes it clear that a major player position in CSP is feasible.
To accelerate the necessary technology transfer process, we recommend “policy measures that facilitate Indian equity investment in existing CSP companies around the world, together with carefully designed schemes for overseas secondments and training”.

To know more on the opportunities in the Indian solar sector and the overall Indian Power sector,

Join us at India’s largest power conference, the India Power Summit 2011 on the 30^th of September & October 1^st 2011 at Mumbai. India.