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ECONOMIC ANALYSIS OF INDIA

Indias economic freedom score is 54.6, making its economy the

124th freest in the 2011 Index. Its score is 0.8 point better than lastyear, with improved scores in four of the 10 economic freedoms,including a large gain in labor freedom. India is ranked 25th out of 41countries in the AsiaPacific region, and its overall score is below theworld average.

Despite the challenging global economic environment, the Indianeconomy has recorded average annual growth of around 8 percentover the past five years, propelled by domestic demand andcontinuing strength in services and manufacturing.

However, growth is not deeply rooted in policies that supporteconomic freedom. Progress with market-oriented reforms has beenuneven. The state maintains an extensive presence in many areas,playing a major role through many public-sector enterprises. Indiasrestrictive and burdensome regulatory environment discouragesbroader private-sector growth and hampers realization of theeconomys full potential. Corruption remains significant, and thejudicial system remains inefficient. Increasing inflationary pressureposes a major risk to overall macroeconomic stability.

Background India is the worlds most populous democracy. Though over 80

percent of the population is Hindu, the country also has one of theworlds largest Muslim populations. The Congress Party governmentwas re-elected to another five-year term in 2009 on a populistplatform that included promises of guaranteed employment for ruralhouseholds. India resumed bilateral talks with archrival Pakistan in2010 after having suspended dialogue following attacks in Mumbai inNovember 2008 by a Pakistan-based terrorist group that killed nearly170. Improvement in relations between the U.S. and India is

evidenced by the launching of a Strategic Dialogue aimed at fosteringcooperation in defense, energy, trade, education, and counterterrorism.Since its 1991 big bang liberalization, the economy has grown

rapidly, first in services and more recently in manufacturing.

Business Freedom36.9+0.6

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Potential entrepreneurs face severe challenges.The regulatory framework is burdensome, and the legal

framework is weak.It can take almost 200 days to obtain a construction permit.

Trade FreedomIndias weighted average tariff rate was 7.9 percent in 2009.Significant differences between bound and applied tariff rates,import and export restrictions, services market access restrictions,complex and non-transparent regulation, onerous standards andcertifications, discriminatory sanitary and phytosanitarymeasures, restrictive import licensing, domestic bias in

government procurement, problematic enforcement of intellectualproperty rights, export subsidies, inadequate infrastructure, anti-dumping restrictions, and complex and non-transparent customsadd to the cost of trade. Twenty points were deducted from Indiastrade freedom score to account for non-tariff barriers

Fiscal Freedom75.4 +2.0Indias tax rates are relatively high. The top income tax is now

30.9 percent (30 percent plus an educational assessment of up to 3percent). The top corporate tax rate is 33.99 percent (30 percentplus a 10 percent surcharge and a 3 percent education tax on thattotal). Other taxes include a dividend distribution tax, a tax oninterest, and a value-added tax (VAT). A general sales tax (GST)was recently approved to replace the VAT. In the most recent year,overall tax revenue as a percentage of GDP was 18.6 percentGovernment Spending77.8 +1.7The government still plays a central role in the economy. In the

most recent year, total government expenditures, includingconsumption and transfer payments, fell slightly to 27.2 percent ofGDP. Public debt is 78 percent of GDP.Monetary Freedom65.1 -2.4Inflation has been relatively high, averaging 9.9 percent between2007 and 2009, and was running above 11 percent in 2010. The

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government subsidizes agricultural, gas, and kerosene production;applies factory, wholesale, and retail price controls on essentialcommodities, 25 crops, services, electricity, water, some petroleumproducts, and certain types of coal; and controls the prices of 74

bulk drugs that cover 40 percent of the market.

QUICK FACTS ABOUT INDIA:-Population:

1.2 billionGDP (PPP):

$3.5 trillion5.7% growth

8.0% 5-year compound annual growth$2,941 per capitaUnemployment:

10.7%Inflation (CPI):

10.9%FDI Inflow:

$34.6 billion

SINGAPORE ECONOMIC ANALYSIS

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Singapores economic freedom score is 87.2, making its economythe 2nd freest in the 2011 Index. Its score is 1.1 points higher thanlast year, reflecting gains in fiscal freedom, monetary freedom,

and financial freedom. Singapore is ranked 2nd out of 41countries in the AsiaPacific region, and its overall score remainssignificantly higher than the world average.Despite the challenging global economic environment, theSingaporean economy has shown a considerable degree ofresilience that stems from strong fundamentals. With an educatedand highly motivated workforce in place, the economyscompetitive tax regime, strong respect for property rights, and

efficient regulations sustain an innovative and vibrant economy.Emerging from the sharp contraction in 2009, the economy hasrebounded well and has regained its entrepreneurial dynamism.The governments fiscal stimulus was timely, well-planned, andexecuted with discipline.Singapore is one of the worlds leading business centers and amajor destination for foreign investment. Monetary stability isgood, and the legal and regulatory framework for the financial

sector is transparent and efficient; government influence in thesector is gradually being reduced. Anti-corruption laws are strongand well enforced. Foreign and domestic investors are treatedequally, and openness to global commerce fosters competitiveness.With prudent and sound banking practices, the financial sector hasweathered the global financial turbulence relatively well.BackgroundSingapore is a nominally democratic state that has been ruled bythe Peoples Action Party (PAP) since 1965, when the country

became independent. Certain rights, such as freedom of assemblyand freedom of speech, remain restricted, but the PAP has alsoembraced economic liberalization and international trade.Singapore is one of the worlds most prosperous nations. Its

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economy is dominated by services, but the country is also a major

manufacturer of electronics and chemicals .

Investment Freedom35.0 no changeForeign investors generally receive national treatment. Licensingprocedures do not discriminate against foreign companies,although export obligations and local content requirements areimposed in some industries. Foreign investment is prohibited insome industries and capped in others. Foreign investment in realestate is limited to company property used to do business and thedevelopment of some types of new commercial and residentialproperties. Bureaucracy is non-transparent and burdensome, and

contract enforcement can be difficult. Foreign exchange, capitaltransactions, and some credit operations are subject to approvals,restrictions, and additional requirementsFinancial Freedom40.0 no changeDespite some liberalization and modernization, state-ownedinstitutions dominate the banking sector and capital markets; 28state-owned banks control about 70 percent of commercialbanking assets. Access to financial services varies sharply around

the country. High credit costs and scarce access to financingimpede private-sector development. Foreign banks account forless than 10 percent of total assets and may not retain more than a5 percent equity stake in a domestic private bank. Insurance ispartially liberalized. Capital markets remain illiquid, with foreignparticipation limited. The government has introduced newfinancial instruments including derivativesProperty Rights50.0 no change

Transfers of land are restricted, and there is no reliable system forrecording secured interests in property. Courts take years to reachdecisions, and foreign corporations often resort to internationalarbitration. Protection of intellectual property rights isproblematic. Proprietary test results and other data aboutpatented products submitted to the government by foreign

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pharmaceutical companies have been used by domestic companieswithout legal penalties. Amendments to the Copyright Actsubmitted to Parliament in December 2009 implement WIPOInternet treaties, extend copyright periods, and strengthen

enforcement of copyright protection in the digital environmentFreedom From Corruption34.0 no changeCorruption is perceived as significant, especially in government

procurement of telecommunications, power, and defense contracts.India ranks 84th out of 180 countries in TransparencyInternationals Corruption Perceptions Index for 2009.Corruption is viewed as an obstacle to foreign direct investmentBusiness Freedom98.2 no change

The overall freedom to conduct a business is well protected underSingapores regulatory environment. Starting a business takesonly three days, compared to the world average of 34 days.Obtaining a business license takes much less than the worldaverage of 18 procedures and 209 days. Bankruptcy proceduresare straightforwardTrade Freedom90.0 no changeSingapores weighted average tariff rate was 0 percent in 2009.

Import and export restrictions, services market barriers, importtaxes, import and export licensing, burdensome sanitary andphytosanitary rules, problematic enforcement of intellectualproperty rights, and export incentive programs add to the cost oftrade. The Private Education Bill enacted on September 14, 2009,may make it more difficult for foreign universities to offer classesin Singapore. Ten points were deducted from Singapores tradefreedom score to account for non-tariff barriersFiscal Freedom91.1 +0.4

Singapore has relatively low tax rates. The top income tax rate is20 percent, and the top corporate tax rate has been reduced to 17percent from 18 percent. Other taxes include a value-added tax(VAT) and a property tax. In the most recent year, overall taxrevenue as a percentage of GDP was 14.2 percentGovernment Spending91.3 -4.0

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Government spending is relatively low. In the most recent year,total government expenditures, including consumptionand transferpayments, increased to 17 percent of GDP. The state remainsinvolved in the economy throughSingapores many government-

linked companies. Plans to open state-owned energy andtelecommunications enterprises to private investment have stalled.Monetary Freedom86.2 +5.3Inflation has been very low, averaging 1.9 percent between 2007and 2009. The government influences prices through regulationand state-supported enterprises and can impose controls as itdeems necessary. Five points were deducted from Singaporesmonetary freedom score to account for measures that distort

domestic pricesProperty Rights90.0 no changeThe court system is efficient and protects private property. Thereis no expropriation, and contracts are secure. Singapore has oneof Asias strongest intellectual property rights regimes, thoughenforcement could be improvedFreedom From Corruption92.0 no changeCorruption is perceived as almost nonexistent. Singapore ranks

3rd out of 180 countries in Transparency InternationalsCorruption Perceptions Index for 2009. The government enforcesstrong anti-corruption laws. It is a crime for a citizen to bribe aforeign official or any other person, either within or outside ofSingaporeFinancial Freedom60.0 +10.0Singapores modern financial sector remains competitive andsophisticated. Bank consolidations have left three dominantbanking groups. The largest is the government-controlled

Development Bank of Singapore, which is publicly listed. Theother two also have significant government-held minority shares.All three have remained relatively profitable throughout the globalfinancial crisis. Overall, barriers to foreign banks have graduallybeen lowered, although a majority of bank board members must beSingapore citizens and residents. Foreign firms compete

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aggressively in insurance, fund management, and venture capital.As of 2010, there were 120 commercial banks, of which 113 areforeign banks. Singapores capital markets are well developed,and banks are increasingly using complex derivatives for risk

management and hedgingLabor Freedom98.0 -0.9Singapores labor market is highly flexible. The non-salary cost ofemploying a worker is low, and dismissing an employee is notburdensome. Regulations related to work hours are veryflexible..Facts about SINGAPORE:-Population:4.8 million

GDP (PPP):$240.0 billion-2.0% growth4.0% 5-year compound annual growth$50,523 per capitaUnemployment:

3.0%Inflation (CPI):

0.2%FDI Inflow:$16.8 billion

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ECONOMIC ANALYSIS OF THAILAND Thailands economic freedom score is 64.7, making its

economy the 62nd freest in the 2011 Index. Its score is 0.6point better than last year due to gains in four of the 10economic freedoms, including monetary freedom and laborfreedom. Thailand is ranked 10th out of 41 countries in theAsiaPacific region, and its overall score is higher TheThailand economy has rebounded quickly from the recenteconomic slowdown with strong export performance andsteady growth. An initial stimulus package focused on taxmeasures, but a second wave provided income transfers,subsidies for utilities and transport, and public investment,

increasing the deficit. Economic fundamentals remainrelatively solid, and the main challenges are to strengtheninvestor confidence and move forward.

Undermining the countrys investment climate and economic

potential, lingering political instability remains themajorsource of setbacks. Corruption remains significant, both inthe private and public sectors, and is oftenencountered in

connection with government procurement, customs, andother business transactions.

Background:- Thailand is a constitutional monarchy with a turbulent

political history. Since 1932, it has experienced 18 militarycoups dtatthe latest in 2006. The government returned todemocratic civilian control in December 2007 and after ayear of political turmoil experienced a peaceful transfer of

power to the political opposition. That government wastoppled by military-supported street protests, and a pro-monarchy, pro-elite government headed by Abhisit Vejjajivawas installed. Demonstrations and protests have continued,and political instability is undoubtedly having a negativeimpact on economic growth. Mr. Abhisits government

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violently cracked down on street protesters in May 2010.About 40 percent of the population is engaged in agriculture,but a thriving manufacturing sector, including themanufacture of such high-technology products as integrated

circuits, contributes significantly to export-led growth . Business Freedom 69.9-0.8 The pace of regulatory reform has been sluggish in recent

years. Starting a business takes an average of 32 days,compared to the world average of 34 days. Obtaining abusiness license takes less than the world average of 18procedures and 209 days. Bankruptcy proceedings are fairlyeasy and straightforward.

Trade Freedom 75.9no change Thailands weighted average tariff rate was 4.6 percent in

2006. Prohibitive tariffs, some import bans and restrictions,services market access barriers, burdensome standards andimport licensing requirements, restrictive sanitary andphytosanitary rules, preferential treatment for domestic firmsin government procurement bids, non-transparent customsvaluation, and weak enforcement of intellectual property

rights add to the cost of trade. Fiscal Freedom74.8 +0.1 Thailand has a relatively high income tax and a moderate

corporate tax. The top income tax rate is 37 percent, and thetop corporate tax rate is 30 percent. Some small enterprisesare subject to a different rate on the lowest income band.Other taxes include a value-added tax (VAT) and a propertytax..

Government Spending 90.6+0.8. In the most recent year, total government expenditures,

including consumption and transfer payments, held relativelysteady at 17.7 percent of GDP. Government interventionpersists, and privatization has suffered several setbacks. Thedeficit is set to widen to 4.5 percent of GDP, though publicdebt will remain sustainable

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Monetary Freedom 70.8+4.4 Inflation has been low, averaging 1 percent between 2007

and 2009. The government controls the prices of more than200 products; can set price ceilings for basic goods and

services; and influences prices through regulation, subsidies,and state-owned utilities. Twenty points were deducted fromThailands monetary freedom score to account for measuresthat distort domestic prices.

Investment Freedom 40.0no change The government prohibits majority foreign ownership in

many sectors and reserves certain professions for Thainationals. Investment regulations are complex, investment

laws are enforced inconsistently, and bureaucracy is non-transparent. Residents and non-residents may hold foreignexchange accounts, subject to some controls. Some foreignexchange transactions, repatriations, outward directinvestments, and transactions involving capital marketsecurities, bonds, debt securities, money market instruments,and short-term securities are regulated and face restrictions.Foreign ownership of land is strictly controlled.

Financial Freedom 70.0no change Thailands financial system has undergone restructuring in

recent years. The regulatory framework has beenstrengthened. Under the 2008 Financial InstitutionsBusinesses Act, the Bank of Thailand (BOT) and the FinanceMinistry have eased restrictions on foreign ownership andcontrol of commercial banks. Foreign shareholders are nowpermitted to retain a 49 percent stake in financial institutions.

Prior approval is still required for foreign ownership between25 percent and 49 percent. The law also gives the BOT theauthority to allow foreign ownership above the 49 percentlimit if such action is necessary to support financial stability.Credit is generally allocated on market terms. As of 2009,there were 14 commercial banks, two of which are

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government-owned. Capital markets are relatively welldeveloped. The stock exchange is active and open to foreigninvestors.

Property Rights 45.0no change

Private property is generally protected, but the legal processis slow, and judgments can be affected through extralegalmeans. Despite a Central Intellectual Property andInternational Trade Court, piracy (especially of opticalmedia) continues. The government can disclose trade secretsto protect any public interest, and there are concerns thatapproval-related data might not be protected against unfaircommercial use.

Freedom From Corruption 34.0-1.0 Corruption is perceived as significant. Thailand ranks 84th

out of 180 countries in Transparency InternationalsCorruption Perceptions Index for 2009. The Thai pressfeatures frequent allegations of irregularities in publiccontracts, most notably over the use of public lands,procurement favoritism, and police complicity in a variety ofillegal activities. In December 2009, the Minister of Public

Health and Deputy Minister of Public Health resigned overallegations of corruption in a medical supplies procurementdeal.

Labor Freedom 76.3+2.7 Thailands labor regulations are relatively flexible. The non-

salary cost of employing a worker is low, and dismissing anemployee is not burdensome. Regulations on work hourshave become less rigid.

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FACTS ABOUT THAILAND:-

Population:

67.0 million

GDP (PPP):$539.9 billion-2.3% growth2.5% 5-year compound annual growth$8,060 per capitaUnemployment:

1.5%Inflation (CPI):

-0.8%FDI Inflow:

$5.9 billion

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INDUSTRY ANALYSIS OF

CONSUMER DURABLE INDUSTRY

India Consumer Durables industry analysis

Consumer Durables industry analysis, industry researchreports and Consumer Durables industry forecasts reports areavailable in the list below. Browse and view ConsumerDurables industry analysis reports. We provide a range of

industry analysis reports covering the Consumer Durablesindustry. The reports will help you understand the size of theindustry and the forecasted growth of the market. It will alsocontain a competitor analysis of companies that operate in theConsumer Durables industry. Please click the table ofcontents to review the content that is in the report to ensurethat you are happy with the report prior to purchase

India Experiences Robust Growth in Consumer Durables

Jul 05, 2010 The consumer durable industry in India iswitnessing healthy growth rate this summer on account of

high demand for refrigerators and air conditioners. TheIndian consumer durable industry is recording strong growthdue to substantial increase in the summer sales. The summerhas registered the highest rise in sales of air conditioners andrefrigerators, as reported by Business Standard. The industryhas posted 30% growth in Q1 2010 against the corresponding

period in 2009 (Q1 2009). The sales of display categoryitems such as Conventional Flat Panel Displays (LCDs, PDPsand Flat screen TVs) also rose phenomenally in Q1 2010.The sales of FPD registered growth of around 70% and ACposted sales increase of nearly 50%. Besides, the sales ofhome appliances surged by a healthy growth rate of

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40%. The main reason for uptrend in the sales of consumerdurables is strong consumer sentiments in the backdrop ofhigher disposable income and the good performance ofdomestic economy. Moreover, the consumer preference has

shifted towards products and devices that come with smarttechnology, innovative design and sleek look. The demandfor technologically advanced devices has risen owing to thebenefits of making life easier and consume lesstime. However, these has been an increase in prices of ACand appliances due to high commodity prices such as copper,steal, etc and hike in VAT by few state governments.

Despite the prices increase, almost all the categories recorded

handsome growth. The Indian consumer durable industry hasexperienced substantial changes for the last few years onaccount of several factors. Among these factors, greateraffordability and changing lifestyle boom in housing and realestate and commercial advertising have been the majorfactors that bring revolution in the Indian consumer behaviorpattern. According to a research report Global ConsumerElectronics Market Forecast to 2013, by RNCOS, the Indian

consumer electronic industry represents immense growthpotential for years to come. The industry is expected to growat a CAGR of nearly 19% during 2010-2013 to US$ 9.5Billion. A Senior Research Analyst at RNCOS said, Indiarepresents huge potential for the consumer durable industryas the penetration level of many appliances is very low. Forexample - the usage of refrigerator stands at around 18%,washing machine (6%), microwave oven (about 1%) and airconditioner (less than 2%). The low penetration of these

products shows a lucrative untapped market.

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Description Indian consumer durables market used to be dominated by a

few domestic players like Godrej, Allwyn, Kelvinator, andVoltas. But post-liberalization many foreign companies haveentered into India, dethroning the Indian players anddominating the market. The major categories in the marketare CTVs, refrigerators, air-conditioners and washingmachines.

India being the second fastest growing economy with a huge

consumer class has resulted in consumer durables as one ofthe fastest growing industries in India. LG and Samsung, thetwo Korean companies have been maintaining the lead in theindustry with LG being the leader in almost all the categories.

The rural market is growing faster than the urban markets,although the penetration level in rural area is much lower.

The CTV segment is expected to the largest contributingsegment to the overall growth of the industry. The risingincome levels, double-income families and increasingconsumer awareness are the main growth drivers of thisindustry.

This report highlights the significance this industry has forthe Indian economy, throwing light on the pre and postliberalization scenario. It discusses the important segments of

this industry and the growth patterns, trends and the demanddrivers. The report also profiles the key players of thisindustry, with a discussion of their business strategies

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GROWTH The first of the 3 part dissertation series on Growth

Strategies of LG Electronics India presents a picture of theconsumer durables industry in India. The consumer Durablesindustry consists of durable goods and appliances fordomestic use such as televisions, refrigerators, airconditioners and washing machines. The consumer durablesindustry can be broadly classified into two segments:Consumer Electronics and Consumer Appliances. ConsumerAppliances can be further categorised into Brown Goods andWhite Goods. The study plays a significant role inunderstanding the reasons for LGs entry into India, itsmarketing strategies, growth strategies and finally, reasonswhy it is the No 1brand in India in the consumer durablesindustry.

The report speaks extensively on the spurt in consumer demand inthe last 5 years due to a large middle class population, rapidgrowth in disposable income, changing socio-economic conditions& favourable economic conditions

Several key trends are driving growth in the sector

Income growth and availability of financing Disposable income levels are rising and consumer financing

has become easierIncreased affordability of products Advanced technology and increasing competition arenarrowing the price gap and the once expensive appliancesare becoming cheaperIncreasing share of organised retail

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Urban and rural markets are growing at the annual rates of7%10% and 25%, respectively, with organized retailexpected to garner a 10% share by 2010 from a mere 3%share at present

Entry of heavyweight retail players is increasing competition Competitive evolution of organised retail due to the entry ofheavyweight players like Croma, E Zone.

Investment oppurtunities Advantage India

India is a major hub for all businesses and consumer goods isthe most emerging sectors in India. As a business hub Indiaprovides a better advantage of setting up business due to bothfederal policies and consumer markets. With increase inmobile factors of production the availability of labour iscreating opportunities for Multi nationals. Anotheradvantage in India as a business destination the currency. Therise in currencies lead to higher productivity resulting inincreased purchasing power.Another factor influencing the

business atmosphere is the India's federal system ofGovernment with clear line of powers within the state and theCentral Governments.

Apart from these India provides a liberal, attractive, andinvestor friendly investment climate. India has the mostliberal and transparent policies on foreign direct investment(FDI) among major economies of the world. India is among

the top 10 FDI destinations.In addition to all this Governmentof India accords high priority to development ofinfrastructure in highways, ports, railways, airports, power,telecom..

Advantage India at a Glance

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General A stable Government with second stage reforms in place Well established corporate ethics Major tax reforms including implementation of VAT

Strengths : Indian FMCG Sector Well-established distribution network extending to rural

areas Strong brands in the FMCG sector Low cost operations Opportunities Large domestic market Export potential

Increasing income levels will result in faster revenue growth Returns and Investments $130 billion-plus investment in infrastructure by year 2010 $ 10 billion FDI in infrastructure development and capital

market by year 2008 Stock market rose by nearly 40 per cent in 2005; foreign

investors are flooding Market

India has the largest young population with over 890 millionpeople below 45 years of age 600 million-plus consumers by year 2010 550 million-plus people under the age of 20 by year 2015 70 million-plus people earn over Rs.8,00,000 ($18,000) a

year - number to rise to 140 million by year 2011 Consumer Spending Pattern In India the Total Consumer Spend was Rs.20,00,000 crore

($445 billion) in the year 2005

Size of Retail market Rs.10,50,000 crore ($233 billion); Organised Retail sector is worth Rs.35,000 crore ($8 billion) Leading retailers' sales growth (2005): 50-100% India is the fourth largest economy in terms of purchasing

power A consumer market of 1.02 billion

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A growing middle class of over 400 million with increasingpurchasing power

FDI and Global Retailers 51% FDI allowed in single brand retailing

FDI laws relatively liberal in wholesale trade Metro AG and Shoprite already operational More foreign retailers eyeing possibilities in wholesale Tesco, Carrefour and Wal-Mart expected to operate soon Woolworths (Dick Smith Electronics - durable retail arm)

entering through a JV with the Tata conglomerate Foreign Exchange Controls Rupee is freely convertible on current account

Rupee is almost fully convertible on capital account for non-residents

For FDI- Profits earned, dividends and proceeds out of thesale of investments are fully repatriable

There are some restrictions for resident Indians on capitalaccount on incomes earned in India

CONCLUSION Consumer durables goods rose by 23 percent and even

non-durables grew by seven percent, indicating the

strength in the GDP growth numbers. The higher credit

cost due increase in rates has not dampened factory

output and production of consumer goods.

Credit growth too has also been above the central bank'starget. The Economic Survey has projected a nine percent

economic growth in 2012 as compared to 8.6 percent

estimated growth in 2010-11. The RBI expects India's

GDP growth rate to remain in the range of around 8.6

percent in this financial year.

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Improved government response on supply side issues can

further limit downside risks to growth. Despite all

positive indications from the GDP numbers, the RBI

recognises the increasing risks to GDP growth, goingforward. Hence, based on the current and evolving

growth and inflation scenarios, will continue with

thecurrent anti-inflation stance.

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Logistics industry in India

Logistics industry in India is an industry that has notachieved its much deserved attention or recognition. It is anarea that is ripe with potential and yet the resources are farfrom complete utilizations. There is however a huge demandfor logistic services in India especially with the growth of theIndian economy along with the influx of new companies in

sectors that was otherwise unknown. Estimated at a value of$14 billion US dollars this industry is slated for another 9%to 10% growth in the years to come.

Purpose of Logistics Industry

The purpose of logistics industry is to enable an effectivetransportation or timely movement of goods from one placeto another. This could be for the purpose of industrial

transportation or even private purposes.

Purpose of Logistics Industry

The purpose of logistics industry is to enable an effectivetransportation or timely movement of goods from one placeto another. This could be for the purpose of industrialtransportation or even private purposes.

Different mediums of Logistics services in India

There are three mediums of logistics services in India. Thesecan be categorized in the following way:

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Air freight this is a modern and the safest mode to ensure afast delivery of goods. A chosen one by many because of theswiftness of the system there are many companies that arenow even providing super fats deliveries by airways even on

the same day. Land transport this is a means of logistics support that has

withstood the test of time through the extensive network ofroads in India. It has been the popularly used method andused especially in the shipments of heavy articles likemachinery and vehicles. This is also a chosen method in caseof household packers and movers.

Railways this is also an age old method of shipments and

transport. Though most used in case of domestic services thisis very effective in the availability of cost effective logisticssupport in India.

Waterways an essential part of this industry this is also oneof the oldest methods. Shipments and transportation of goodsis done on an international basis through this way. It is apt incase of shipments of oil, highly sensitive or volatile articleslike Uranium.

Key players of the Logistics industry in IndiaAmong the key players of the Indian logistics industry thereare certain international names along with nationalcompanies that are not only world leaders in the field but arealso part of the Indian industry for a long time now.

DHL a very commonly known name in the Indian logisticsindustry, DHL has been part of the industry for a long timenow. Established in San Francisco in the 1969 DHL has

grown across 220 countries with over 300,000 employees. Ithas built a reputation over the years as a responsible logisticssupport air, ocean, express freight and overland transport,contract logistic solutions.

TNT this is an international brand that has been a part ofthe Indian market also. Established at Netherlands, TNT is a

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reliable name in the arena of international transportation anddistribution business. Spread across 200 countries it has anestimated revenue turnover of $ 3,500 billion US dollars.

AFL this is one of well known international players in the

logistics industry of India. The main areas of service by thecompany are in the area of logistics and warehousing alongwith Courier Company and custom consultant.

BLUE DART this is one of the premier companies in thefield of logistics. The company has a huge network linkedwith the most advanced communication systems. Blue Darthandles large and oversized packages and stands for anovernight delivery of such goods.

GATI one of the pioneering companies in the field oflogistics. This is one the companies that have taken severalinitiatives to implement modernization in the area oflogistics. With a turnover of Rs. 576 crores this companybelieves in setting new standards of customer service.

DTDC this company spreads over 3700 locations withinIndia and 240 international places. The company is a leadingname in low cost shipments along with timely delivery

ASHOK LEYLAND this is an established name in themanufacture of trailer trucks and heavy vehicles in India. Ithas come up with a new venture in Ashley TransportServices Ltd. in the area of information exchanges and thebusiness of freight contractors along with integrated logisticsservices.

FIRST FLIGHT this is an Indian company that hasdomestic, international and many other programs of multi

tracking technologies. AGARWAL PACKERS AND MOVERS this is a

popular name in the field of logistics companies of India.Services like shifting, transport of cars, and all other forms ofquality packing and transportation this is a name that has

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over the years become synonymous with quality andassurance.

Future of Logistics - The Indian Scenario

Indias logistics sector attracted investments worth Rs.23,200 crore in first half of 2008,

according to a study by Assocham. It outclassed some of themajor sectors including aviation (Rs 20,890 cr), metals andmining (Rs 8500 cr) and consumer durables (Rs 6000 cr)among others.

Among the factors cited by analysts for the rapid growth of

Indian logistics include the growth of organized retailindustry, commodity markets, growth in manufacturing anddevelopment of Special Economic Zones. (SEZ).

According to a report by Cushman and Wakefield, real estateconsultants, Indian logistics industry is expected to growannually at the rate of 15 to 20%, reaching revenues ofapproximately $385 bn by 2015. Market share of organizedlogistics players is also expected to double to approximately

12% during the same period. The report said about 110 logistics parks spread over

approximately 3,500 acres at an estimated cost of $1 bn areexpected to be operational and an estimated 45 mn sq ft ofwarehousing space with an investment of $500 mn isexpected to be developed by various logistics companies by2012.

A large number of upcoming SEZs have necessitated thedevelopment of logistics for the

domestic market as well as for global trade. Mumbai, Kolkata, Chennai and Hyderabad have become

preferred locations for logistics parks. These locations arecharacterized by excellent port, rail, and road connectivityand are witnessing significant investment in infrastructure.

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Eight logistics parks with an approximate investment of $200mn is 600 acres of land around Mumbai.

According to industry analysts, almost all logistics playersare in the process of setting up warehouses, container freight

stations, inland container depots, logistics parks, distributioncentres and other facilities to tap the trade opportunitiesfuelled by revolution in the retail, ports etc.

Demand for warehouses and logistics services are expectedto accelerate further due to increase in foreign trade and theupcoming Maha Mumbai Special Economic Zone.Warehouse rentals in Panvel are expected to increase by 15to 20% over the next two years.

Proximity to textile and auto-component industry clusters andother manufacturing units has made Kolkata a majoreconomic centre. Ten Special Economic Zones (SEZs) in theproximity of Kolkata have received in-principal approvals.This will result in major demand for logistics in this region.

There are plans for 4 logistics parks spread acrossapproximately 400 acres. Centers like Haldia, Falta, Pargana,Dankuni, Kharagpur, Bantala and Durgapur are expected to

witness substantial logistics activities in the near future. Five logistics parks are being set up in Hyderabad, spreadacross 220 acres and approximately

10 mn sq ft of warehouse space coming up by 2012. It scoreshigh as a logistics destination as it provides excellentconnectivity to large markets in southern and western Indiaand has established clusters of textile and engineering firms,as well as an important centre for the pharmaceuticalindustry.

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ESTIMATE OF BUSINESS SPACE IN

LOGISTICS SECTOR Type of Infrastructure Estimated nos./demand

Investment Needed

1 ICD/ FTWZ 50 nos. 7500

2 Air Cargo Centers 1.50 lac sq.m. 300

3 Agro Warehouse 35 mn. 600

4 Integrated Transport Centers15 nos.4875

Total Investment needed (approx.) 13275

CONCLUSION Another important factor is the opportunity for big ticketinvestments into the logistics infrastructure. While India hasbeen lagging behind in terms of transportation links, theGovernment is now betting big on public-private partnershipprojects (PPPs) for the development of highways, portconnectivity, dedicated freight corridors and establishment offree trade warehousing zones (FTWZ). The state-runprofitable Indian Railways plans to set up multi-modallogistics parks and is inviting private players to join hands.DHL has just announced an investment of USD 10 million toset up a warehousing facility in the upcoming FTWZ inChennai. Many such areas are opening up, that offer hugeinvestment potential.

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While the issues of weak infrastructure, poor connectivityand complex tax regimes have bogged down the shippers and3PLs alike in the past, the long term outlook is stronglypositive for this industry. As a testimony to the market's

potential, a recent study by UK-based Transport Intelligencefound that India tops the emerging markets as an attractivedestination for foreign investment, which has been attributedto its size and growth prospects. In short, the time is now ripefor Logistics 2.0 to take off in India.

As Indian corporate houses are increasingly realising theimportance of logistics in moving their products across thecountry, new business opportunities are emerging for

providers of e-Logistics services, or vehicle tracking systems. Currently, the number of vehicles equipped with such

tracking devices is very few. The number of companies thatprovide such solutions are also very few in numbers. But,industry experts feel, the scene is set to change soon, as morecompanies would jump on to the bandwagon and newtracking devices fill the logistics market.