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Edited, printed and published by Chandrajit Banerjee, Director General, CII, on behalf of Confederation of Indian Industry from The Mantosh Sondhi Centre, 23, Institutional Area, Lodi Road, New Delhi-110003, Tel: 91-11-24629994-7, Fax: 91-11-24626149, Email: [email protected], Website: www.cii.inPrinted at Lustra Print Process Pvt. Ltd., K No. 51/21, Rohad, Bahadurgarh (Haryana), PIN Code-124507 Registration No. 34541/79

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Contents Volume 39 No. 1 January 2017

cover story

07 demonetization an epochal initiative

The demonetization of high denomination notes of `500 and is a substantive economic reform to hasten the move towards the formalization of the Indian economic system and put an end to the parallel economy. Besides stamping out black money encouraging more transactions through electronic means, and promoting wider use of cashless transactions, it paves the way for increasing savings, investment and growth in the long term, by increasing transparency, augmenting the tax base and encouraging small enterprises to join the mainstream. As a way forward, CII has suggested an array of recommendations to ease the transition.

spotlight03 President of India celebrates Skills with CII

mindspace19 Some Big Ideas for the Union Budget

sectoRscape25 Accounting Reforms in Indian Railways

27 Army Technology Seminar

30 Reimagining Indian Healthcare

33 Realizing the Potential of Indian Handlooms

initiative40 CII Report on 'Future of Jobs in India - Enterprises and

Livelihoods'

societal inteRface 47 Woman Exemplar Program

plus...

BUILDING CAPACITy

PoRTFoLIo FoR ExCELLENCE

ENGAGING WITH THE WoRLD

REGIoNAL REVIEW

... and moRe

Communiqué January 2017 | 3

SPoTLIGHT

Skill development is the backbone of India’s industrial productivity and competitiveness. CII has been working on skill development

initiatives for over three decades. Beginning with the CII WorkSkills Competitions in 1989 for 205 workers of the manufacturing sector in Kolkata, CII, through its National Committee on Skill Development, and the National Task Force on Sector Skill Councils & Employment, has been working to link industry and job-seekers, and create a vibrant ecosystem for skill development.

one such grassroot initiative of distinction is the CII Skills Training Center (STC), in Chhindwara, Madhya Pradesh. As a recognition of this industry-led initiative, Mr Pranab Mukherjee President of India, graced the Annual Day function of the STC on 14 December in Chhindwara. The function was also attended by Mr om Prakash Kohli, Governor of Madhya Pradesh; Mr Kamal Nath, Member of Parliament, and Mr Gourishankar Bisen, Minister of Farmer Welfare and Agricultural Development, Madhya Pradesh, along with over 1200 delegates from industry, trainees, students, Government officials, local skill partners, civil society and academia.

The STC, which was launched in a temporary set-up in 2008, shifted to its own premises in 2012. It is today a state-of-the-art institute with 10 industry partners imparting training in 12 trades to over 900 youth each year. The industry partners, Caterpillar/GMMCo, Cummins, GMR, JCB, Larsen & Toubro, Mahindra & Mahindra, Shapoorji Pallonji, Taj and Tata Strive, Toyota Kirloskar Motors, and Voltas and Tata Strive, have

President of india celebrates skills with Cii

Pranab Mukherjee, President of india, with (l-r): Chandrajit Banerjee, director General, Cii; Kamal nath, Member of Parliament; om Prakash Kohli, Governor of Madhya Pradesh; Gourishankar Bisen, Minister of farmer Welfare & agricultural development, Madhya Pradesh, and dr naushad forbes

Pranab Mukherjee, President of india, being felicitated by dr naushad forbes, President, Cii, and Co-Chairman, forbes Marshall, at the annual day of the Cii skills training Center in Chhindwara

4 | January 2017 Communiqué

SPoTLIGHT

brought in international standards of training with the latest equipment and advanced pedagogy, ensuring high success in candidate placements.

Skill development will help create jobs, strengthen the resilience of the Indian economy, increase the contribution of the services sector to GDP, and expand the flow of remittance into the country from our overseas workers, said Mr Pranab Mukherjee. Applauding the vision of CII for nation-building, particularly in skill development, Mr Mukherjee said that India’s young workforce will be an asset if they have jobs. However, if the country is unable to provide jobs, there would be unrest, he warned, noting that India’s universities and colleges produce a large number of graduates every year, but most of them are unemployable.

He thanked the industry members who are partnering CII to impart training at the Center, and expressed confidence that more and more youth would continue to benefit from this unique initiative.

The active support of the Government of Madhya Pradesh has been crucial to the functioning of the STC.

Both Mr om Prakash Kohli and Mr Gourishankar Bisen, referring to the success of the State's Global Investor Summit, observed that initiatives such as these have increased investor traction.

Lauding CII for setting up the Skills Training Center at a time when not many industries were present in Chhindwara, Mr Kamal Nath said the partnership has prospered into a successful institute, with excellence in training, faculty and curriculum.

Industry-led initiatives such as the Chhindwara multi-skill Center of Excellence need to be replicated across the country, said Dr Naushad Forbes, President, CII, and Co-Chairman, Forbes Marshall.

Re-emphasizing the constant endeavour to scale up, Mr Chandrajit Banerjee, Director General, CII, shared that the Center had started with only three industry partners working out of a rented premises, but has now scaled up with 10 industry training partners currently spanning manufacturing, construction, and hospitality, with plans to increase the number of youth trained each year.


The demonetization of high denomination notes of `500 and `1000 is a bold, first of its kind landmark initiative by the Government. This substantive economic reform is meant to hasten the move towards the formalization of the Indian economic system and put an end to the parallel economy. Deemed as an epochal initiative, demonetization is expected to stamp out black money by encouraging more transactions through electronic means and promoting wider use of cashless transactions.

The sudden move to withdraw cash from the system has led to a change in the composition of narrow money supply by reducing the proportion of ‘currency in circulation’ and raising the share of demand deposits with banks. This infusion of demand deposits in the banking system paves the way for increasing savings, investment and growth in the long term. Besides, demonetization would increase transparency, augment the tax base, and encourage small enterprises to join the mainstream.

As a way forward, CII has suggested an array of recommendations such as relaxation of provisioning norms for NBFCs till March 2017, allowing insurers to relax lapsation and other terms of policies to protect policy-holders, roll out of digital connectivity, and the announcement of a spate of growth-friendly and inclusive measures in the Budget, to build a strong economy.

our Cover Story discusses the implications of demonetization on the economy, examines the developments in the money market post-demonetization, and provides a detailed roadmap of the way forward, to maximize the positives from demonetization.

demonetization an epochal initiative

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economy


In a decisive move, the Narendra Modi Government decided

to demonetize the high denomination notes of `500 and `1000. This bold and impactful move continues the series of actions taken by the Government to curb black money or undisclosed income. These include the appointment of a Special Investigation Team to probe black money, the voluntary disclosure scheme for foreign assets, the income disclosure scheme for domestic black money, and the Benami Transactions Act which was notified recently. Clearly, the intention is to have a honest economy with no scope for tax evasion.

The other ob ject ive of demonetizat ion is t o encou rage more t ransact ions through electronic means and discourage the use of cash. The Jan Dhan yojana, introduced in August 2014, has opened more than 255 million bank accounts for unbanked households, and almost 200 million of these have been issued RuPay debit cards. Aadhar unique identification cards are being linked with the Jan Dhan yojana, and

about 100 million bank accounts have been seeded with Aadhar. As the penetration of banking increases, it is hoped that the transition towards cashless payments will be made.

The shortage of currency, though, has resulted in many hardships, and a setback to economic growth is likely in the short - term. However, once cash availability is restored, the economy should return to normal, and a substantial bounce in demand is likely from remonetization. Some of the benefits that will be visible in the medium-term need to be emphasized.

• The existence of a parallel economy provides unfair competit ion to organized industry which pays taxes and complies with regulations. In the real estate market, for example, there is very little transparency in pricing, with the cash component being quite high in the unorganized sector. This enables the buyer and the seller to avoid stamp duties and capital gains tax respectively. The lack of transparent pricing in real estate has affected the ease of setting up businesses, especially for foreign investors.

a strong attack on the Cash economy

15.9 14.7 13.011.0

7.47.4

7.67.6

7.9

0.0

5.0

10.0

15.0

20.0

25.0

2011-2012 2012-2013 2013-2014 2014-2015 2015-16

Savings in physical assets Savings in financial assets Valuables

23.622.4

20.919.0

households savings (as percentage of gdp)

Source: CSo, RBI (data on savings in physical assets not yet available for 2015-16)

‘Prime Minister Modi’s move to stamp out black money once and for all means a definitive and impactful end to the parallel economy, and encourages wider use of cashless transactions. The Pr ime Minister, addressing the nation, clearly mentioned his vision and objectives for the unusual and innovative move of making `500 and `1000 notes not legal tender any more.

Demonetizing high denomination notes can be an effective means of checking the accumulation of wealth in cash. The Government has taken a measure aimed at the heart of the black cash economy, sending out the strong message that corruption and underground transactions will no longer be tolerated.

The Prime Minister’s resolute action has infused confidence among honest tax payers, legal industry and the public at large that India means business when it comes to halting corruption and black money.’

dr naushad forbes, President, CII, and Co-Chairman, Forbes Marshall

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highlights of the Prime Minister’s address to the nation

Benefits of Demonetization • Demonetization has induced a shift away from the

country’s massive dependence on transactions based on cash/paper money, towards a digital economy.

• Tax incentives and tax breaks being provided to incentivize digitization.

• Citizens urged to use the recently-launched BHIM app platform for making various payments.

• With the current influx of large amounts of money into the banking system, banks urged to concentrate on helping the poor and the middle class.

Major Boost to agriculture• Farmers who have taken loans for the rabi crop

are exempted from interest for 60 days.

• Farmers who have already paid back their loans will get the interest credited into their bank accounts.

• Government proposes to add `20,000 crores to the NABARD fund to ensure cheap credit to farmers.

• Around 3 crore Kisan Credit Cards will be upgraded to RuPay debit cards to enable farmers to purchase products and services digitally, without having to go to the bank.

support for housing• Under the Pradhan Mantri Awaas Yojana, interest

subvention for loans of up to `12 lakhs, in rural areas.

• In urban areas, loans of up to `9 lakhs will receive interest subvention of 4% under the yojana. Loans of up to `12 lakhs taken in 2017 will receive interest subvention of 3%.

• The number of houses built for the poor under the yojana in rural areas increased by 33%.

• Loans of up to `2 lakhs taken in 2017 for new housing or extension of housing in rural areas will receive interest subvention of 3%.

Benefits to MSMEs• Government would underwrite the loans given

by Non Banking Financial Companies (NBFCs). This would enable better access to credit for small shop owners and small enterprises.

• Cash credit limit for small enterprises increased from 20% to 25%.

• Cash credit limit for small industry raised from 20% to 30% of turnover, for enterprises which transact digitally.

• The guarantee amount under the Credit Guarantee Scheme has been doubled from `1 crore to `2 crores. The Government will float a trust which would act as a guarantor for the scheme, so that banks do not have to bear the burden of loans given to small businesses. NBFCs will also be covered under this scheme.

• Government aims to double MUDRA allocations giving priority to dalits, tribals, backward classes and women.

• The benefits under the MUDRA scheme will now be doubled to extend to more micro units and small businesses.

schemes for senior Citizens and Pregnant Women• New scheme to ensure that senior citizens do

not face the impact of reduced interest rates. Senior citizens to receive a fixed interest rate of 8% for a period of 10 years on deposits up to `7.5 lakhs. The interest would be paid monthly.

• Under a nation-wide scheme for financial assistance for pregnant women, `6000 would be transferred directly to the bank accounts of pregnant women, to ensure adequate nutrition, proper delivery, and vaccination for the new-born. This would reduce infant mortality and help ensure nutrition before and after delivery.

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• For the Government, a n i n c r e a s e i n t a x collection and in the tax base will provide the resources for spending on developmental activities. As per the Income Tax Amendment Act 2016, the Government will tax unaccounted income at 50%, leading to a windfall increase in tax collections. As future transactions move towards digital, they will get into the tax net, building a higher permanent tax base. This will allow a step-up in social expenditure in areas such as health and education.

• For banks, deposit mobi l i za t ion wi l l be strengthened, which will enable them to provide more credit at lower rates. An increase in bank deposits can lead to an increase in the savings rate, particularly in financial savings, which can be used to finance investments in the economy.

• Demonetization would encourage many small enterprises, self-employed professionals, and self-employed unskilled and semi-skilled workers, to shift to using less cash, and encourage them to become more integrated with the formal economy.

• For the economy, an increase in savings, investment and growth can be expected, as a good proportion of black money tends to be used for consumption rather than savings. Financial savings have stagnated around 7.5-8.0% of GDP. Greater use of e-payments will reduce unnecessary cash holdings among the public, and improve productivity in the economy.

Progress of re-monetizationThe economy is currently going through a period of cash crunch and many are concerned about the slow progress of re-monetization. The four printing presses in the country, in Nashik, Dewas, Salboni and Mysuru, are working 24x7 to complete the huge job of printing currency notes. The Reserve Bank of India (RBI) has been making regular announcements on the amount of currency printed so far.

Printing is said to have started in early September with mostly `2000 notes being printed in the initial per iod. This enabled quicker replacement of the extinguished notes in terms of value. However, people faced difficulty in

using these notes due to the lower availability of smaller denominations as change. According to the RBI, it had printed 22.6 billion notes as of 19 December, of which 20.4 billion were of small denomination.

Currently, `500 notes are being printed in larger quantities to address the problem of availability of change.

one can assume that the entire amount of currency extinguished need not be replaced, as many more transactions will now be in electronic form. The table shows that if 75% of the extinguished currency is replaced, then more than half the amount had already been printed by 19 December. of course, the remaining portion will take more time since these are being printed as `500 notes.

‘The interest rate cuts by key banks are going to be critical in the process of economic stregthening in the medium term. Bank lending is likely to pick up significantly, as deposit mobilization has been strong following demonetization. As loans become cheaper, sectors of the economy such as consumer durables, automobiles and housing should see a recovery. Various measures have been taken to encourage lending to SMEs. CII expects start-ups and SMEs to play a major role in the next growth cycle.

The Prime Minister has given a very clear message in his speech that low cost housing would play a critical role in this recovery. We believe this is very important since this sector has the highest multiplier effect, and this would help not just growth to pick up but also employment.’

chandrajit Banerjee, Director General, CII

extinguished notes and amount to be Replaced

`lakh crore

High value currency extinguished as of 8 November

15.4

Percentage to be replaced 0.75

Total amount to be issued 11.6

Amount issued till 19 December 5.92

Remaining amount 5.6

Source: RBI, CII calculations

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CII has been consistently submitting suggestions to help manage the disruptions caused by demonetization, especially for SMEs, farmers,

and the common people. The Government has now indicated that businesses that are coming into the formal sector will not be harassed by the Income Tax Department and instructions in this regard have been issued under Section 119.

small and Medium enterprises (sMes) SMEs are facing some liquidity issues due to currency withdrawal limits for meeting operational expenses incurred for running their businesses. These include paying daily wage contract workers, local transportation, paying entry taxes, and other petty expenses incurred daily.

Further, SMEs working on projects in sites located in remote areas need a lot of cash. The insufficient flow of currency has badly affected work in such projects. There is a great chance of project time over-run due to this crisis. Since the level of digitization at the micro enterprises level in smaller towns is limited, SMEs are also facing cash inflow issues.

CII has suggested an increase in the cash withdrawal limits from the current accounts for SMEs, and has also suggested that the Government conduct awareness sessions in partnership with industry bodies. This would help acquaint small enterprises with various digital payment services to assist them in the smooth transition to cashless transactions.

farmersIn the current agricultural marketing system, payments to the farmers are made in cash by the market intermediaries, notably arthiyas in the regulated mandis, and village traders, etc. The farmers are accustomed to cash payments, which also make it convenient for them to purchase inputs immediately thereafter.

A large number of farmers hold cash which is legitimate, as they are exempt from Income Tax. CII has therefore recommended an increase in the daily withdrawal limits for farmers, and allowing higher level of deposits without scrutiny.

financial sectorNon Banking Financial Companies (NBFCs) lend significantly to segments such as transport operators, farmers, equipment hirers, SMEs, and small traders, and are repaid on a routine basis through cash collections. The biggest risk for NBFCs is a rise in defaults and Non Performing Assets (NPAs). As most large NBFCs are borrowers from banks and money markets, the rise in default could pose systemic risks. CII has therefore recommended that the RBI may consider relaxation in the provisioning norms for NBFCs and MFIs till March 2017.

Similarly, in the insurance sector, default or delay in payment could result in losses to policy-holders and to the company, as the company would already have incurred significant expenses during the sale. CII has requested that insurers be allowed to relax lapsation and other terms of policies to protect the interests of policy-holders.

suggestions for an economic turnaroundSome measures can be taken to ease the short-term difficulties of the public and build towards a sustainable turnaround in the economy. CII suggestions in this regard include:

• The personal income tax rate should be lowered, along with a reduction in the corporate tax rate, in the forthcoming Budget. CII has recommended that, after removal of exemptions, the corporate tax rate should be lowered to 18%. Likewise, the highest tax rate for individual tax payers should be brought down to boost demand and compensate for deflationary tendencies. More people will then be encouraged to enter the tax net.

• Public investment should be stepped up to offset the job losses that have taken place. The Government, in consultation with the States, can identify specific projects that can be expedited. These projects should be labor-intensive and create jobs in rural areas where many workers have returned. Examples of such projects include road building, minor irrigation works, and projects related to agricultural warehousing and marketing.

Post-demonetization the Way forward

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• The Government has actively moved towards a ‘plastic economy.’ There is a need to roll out digital connectivity and smart phones to the last mile, as also educate users, especially in small towns and villages. Rural areas need to be prioritized in terms of cash availability, since farmers are used to being paid in cash, and penetration of the banking system is low.

• C I I suggests tha t the Government and Reserve Bank of India devise appropriate savings instruments so that households do not maintain savings in cash. Micro financial products that are easily accessible would be the way to go.

• The use of cash in the unorganized sector needs to be reduced by encouraging tiny enterprises to enter the formal market. In addition, the ease of doing business should be faci l i tated to encourage enterprises to grow, and step into the formal sector.

• There is a need to tackle cash use in specific sectors such as real estate, by reducing stamp duty, and gems and jewelry, by lowering import duty, etc.

• Applicable charges on credit and debit cards need to be studied and reduced to the lowest possible. Customers should not be charged at all, and, if possible, some incentives should be given to them for the use of electronic payments.

• The penetration of smart phones is much lower than that of ordinary mobile phones. Payment methods without smartphones have been developed, but are not yet being widely used. Pilot projects for such payments must be encouraged across the country.

on 8 November, the Government announced the demonetization of `500 and `1000 notes with immediate effect, giving little time for hoarders or small-time savers to convert their stock of

henceforth illegal tender money into legal tender money. This was followed by subsequent policy announcements from the Reserve Bank of India (RBI) to ease the hardships faced by the citizens.

However, even after 50 days of the announcement, the long queues of people outside ATMs to withdraw their savings continue. Small traders, especially in the informal sector, are facing a tough time with a decline in sales, and small units have shut down, unable to meet their working capital expenditure. Setting aside the hardships faced by the common man, how much black money or unaccounted money was disclosed or turned into white money is yet to be announced.

Prior to the demonetization announcement, under the Income Declaration Scheme 2016, the Government was able to unearth `65,250 crores of undisclosed income through 64,275 declarations upto 30 September, 2016. More such undisclosed income would be made public with the Income Tax department identifying 67.54 lakh potential non-filers of income tax, who had conducted high-value transactions in 2014-15 but have not filed their returns.

What are the developments in the money market after demonetization? In India, where almost 50% of the sector is informal, it is but natural that money supply in the form of ‘currency with the public’ is the most important medium for conducting economic transactions. out of the money supply, referred to as M1, consisting of currency with the public, and demand deposits and other deposits with the RBI, ‘currency with the public’ accounted for almost 61% of the total supply, prior to the announcement of demonetization.

As per the Weekly Statistical Supplement of the RBI for the week ending 9 December 2016, the share of ‘currency with the public’ in the total money supply 'M1' was reduced to 39.1%. In actual terms, between 28 october and 9 December 2016, there was a decline of `9204.3 billion rupees, indicating that almost 54% of the currency with the public was absorbed from the economy (see Table 1). The ‘currency with the public’ saw a year-on-year increase of 17.7% in 2016 as compared to a 11.1%

The demonetization exercise is a move towards making India a ‘less cash’ economy, says A.Srija

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Money Market after demonetization


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increase in 2015 as on 28 october 2016. one month after demonetization, the picture changed, with the ‘currency with the public’ seeing a year-on-year decline of 48% in 2016 (as on 9 December) as compared to a 12.4% increase in 2015.

Similarly, ‘demand deposits with banks’ as on 28 october, 2016 saw a year-on-year increase of 11.5% as compared to 12.1% in 2015. But as on 9 December 2016, ‘demand deposits with the banks’ saw a year-on-year increase of 29.4% in 2016, as compared to 13% in 2015. This increase could be due to the illegal tender of `500 and `1000 notes being deposited back into the bank accounts.

The demonetized notes were allowed for certain transactions, for specified periods. of these, purchases from consumer cooperatives witnessed a huge rush as people with illegal savings of the banned notes could use them for the purchase of food and other household items. But if a large number of people who had hoarded their savings in cash had expended it on food and other household items, there should have been an increase in the Consumer Price Index (CPI). The latest available CPI data shows that both rural and urban inflation declined in November 2016 as compared to october 2016, meaning that the rush to consumer cooperatives was not large enough to impact consumer

expenditure of the economy as a whole.

Bank credit to the commercial sector has seen a decline post demonetization. As on 28 october last year, the year-on-year variation in ‘bank credit to commercial sector’ at 8.7% was the same as reported in 2015. A month later, on 9 December, it declined to 5.4% as compared to 10.5% in 2015 (Table1).

The increase in ‘net foreign exchange assets of the banking sector’ has been low in 2016 as compared to 2015. As on 28 october, the year-on-year variation in these assets saw an increase of only 7.4% in 2016 as compared to 19.9% in 2015.

Black money or undeclared income is mostly invested into gold and jewelry, real estate or foreign currency, or is quickly laundered through round tripping. It is largely not held in the form of cash in hand. News reports indicate that gold imports increased by 23% in November 2016 as compared to November 2015, and imports of pearls, precious and semi-precious stones rose to 61% during this period. Some of this increase could be due to the increase in gold and jewelry purchases to convert the illegal tender.

To address the issue of shortage of cash in the economy, the Government promoted the electronic or digital mode of payments to make India a ‘less cash’ economy. With

table1: components of money stock and select sources of money stock

Rupees in Billionitem outstanding as on

28 october 2016variation over Year-on-Year

2015 2016

Amount % Amount %

Currency with the public 17013.8 1444.7 11.1 2563.9 17.7Demand deposits with banks 10511.8 1019.9 12.1 1084.7 11.5other deposits with Reserve Bank 159.6 73.0 90.5 6.0 3.9M 27685.2

Bank credit to commercial sector 79614.6 5894.5 8.7 6346.6 8.7Net Foreign Exchange Assets of Banking Sector

25993.0 4014.0 19.9 1792.4 7.4

item outstanding as on 9 december 2016

variation over Year-on-Year

2015 2016

Amount % Amount %

Currency with the public 7809.5 1663.5 12.4 -7217.3 -48.0Demand deposits with banks 11973.7 1061.6 13.0 2722.9 29.4other deposits with Reserve Bank 154.2 65.5 79.5 6.3 4.2M 19937.4

Bank credit to commercial sector 78847.9 7143.7 10.6 4058.8 5.4Net Foreign Exchange Assets of Banking Sector

26031.4 4081.2 19.9 1403.2 5.7

Source: Extracted from RBI Weekly Statistical Supplement dated 23rd December 2016 and 11th November 2016


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the introduction of Information Technology to banking operations, banking transactions have undergone a sea-change, from being paper-based to largely paper-less. The goal of the RBI is to adopt a complete digital mode of payment for economic transactions. A look at

the progress of payment indicators over the last five years in Table 2 and Table 3 shows the developments in the payment system, both in volume and value terms, over the period 2011-12 to 2015-16.

The initial electronic mode of money transfer was

table 2: payment system indicators

system volume in million2011-12 2012-13 2013-14 2014-15 2015-16 % change

RTGS 55.04 68.52 81.11 92.78 98.34 43.5CCIL operated Systems 1.87 2.26 2.56 3.03 3.12 38.1Paper Clearing 1341.87 1313.5 1257.31 1196.51 1096.37 -16.5Retail Electronic Clearing 512.44 694.07 1108.32 1687.44 3141.53 352.6NEFT 226.11 394.13 661.01 927.55 1252.88 217.9Immediate Payment Service 0.1 1.23 15.36 78.37 220.81 17852.0National Automated Clearing House 86.5 340.17 1404.08 Cards 5731.61 6398.4 7219.13 8423.99 10038.7 56.9Credit Cards 322.15 399.13 512.03 619.41 791.67 98.3Usage at ATMs 2.19 2.52 2.96 4.29 6.00 138.1Usage at PoS 319.96 396.61 509.08 615.12 785.67 98.1Debit Cards 5409.46 5999.2 6707.10 7804.57 9247 54.1Usage at ATMs 5081.92 5530.2 6088.02 6996.48 8073.39 46.0Usage at PoS 327.54 469.05 619.08 808.09 1173.61 150.2Prepaid Payment Instruments 30.6 66.94 133.63 314.46 748.02 1017.4m-wallet 32.7 107.51 255 603.98 1747.0PPI Cards 33.76 25.60 58.91 143.47 325.0Paper Vouchers 0.48 0.53 0.55 0.56 16.7Mobile Banking 25.56 53.30 94.71 171.92 389.49 630.8

Source: RBI Monthly Bulletin, Various Issues, Table No.43: Payment System Indicators.

table 3: payment system indicators

value in Rupees Billionsystem 2011-12 2012-13 2013-14 2014-15 2015-16 % change % changeRTGS 1079790.59 1026350.05 904968.04 929332.89 1035551.64 14.4 11.4CCIL operated Systems 406071.18 501598.49 621569.63 752000.42 807370.42 29.9 7.4Paper Clearing 99012.14 99982.25 93316.04 85434.14 81860.79 -12.3 -4.2Retail Electronic Clearing 20575.3 31881.14 47856.29 65365.51 91408.14 91.0 39.8NEFT 17903.5 29022.42 43785.52 59803.83 83273.11 90.2 39.2Immediate Payment Service 0.42 4.33 95.81 581.87 1622.26 1593.2 178.8National Automated Clearing House 214.81 1220.88 3801.83 1669.9 211.4Cards 15510.77 18637.36 22159.58 25415.27 29397.65 32.7 15.7Credit Cards 978.73 1243.93 1556.72 1922.63 2437.02 56.5 26.8Usage at ATMs 12.6 14.42 16.87 23.47 30.41 80.3 29.6Usage at PoS 966.13 1229.51 1539.85 1899.16 2406.62 56.3 26.7Debit Cards 14532.05 17393.44 20602.86 23492.65 26960.63 30.9 14.8Usage at ATMs 13997.73 16650.08 19648.35 22279.16 25371.36 29.1 13.9Usage at PoS 534.32 743.36 954.51 1213.49 1589.27 66.5 31.0Prepaid Payment Instruments 62.01 79.22 81.05 213.42 487.58 501.6 128.5m-wallet 10.01 29.05 81.84 205.84 608.6 151.5PPI Cards 49.62 28.36 105.35 253.77 794.8 140.9Paper Vouchers 19.6 23.63 26.24 27.97 18.4 6.6Mobile Banking 18.21 59.90 224.18 1035.3 4040.91 1702.5 290.3

Source: RBI Monthly Bulletin, Various Issues, Table No. 43: Payment System Indicators.


introduced through the paper clearing option, which consisted of cheque clearance through the cheque truncation system. Later, electronic transfer of funds was introduced to enable large fund transfers from one bank to multiple clients spread across different banks. The core banking system further facilitated banks in adopting electronic modes of fund transfer.

With the introduction of new modes of digital payments from 2012-13, these payment modes have seen meteoric growth, especially debit card payments, prepaid payment instruments, immediate payment services, mobile banking, etc.

As Table 3 shows, while the volume of transactions through electronic means might be lower as compared to card payments or prepaid payment instruments, in terms of the value of transactions, these vary from `80,000 to more than `10 lakh billion.

In the emerging mode of digital payments such as card payments and prepaid payment instruments, the volume of transactions may be more, as the transactions are one to one, but the value is less. With incentives and schemes such as the Lucky Grahak

A.Srija is from the Indian Economic Service, currently posted as Director, NITI Aayog. The views expressed are personal.

yojana for consumers, and the Digi Dhan Vyapar yojana for merchants being introduced by the Government to promote digital mode of payments right down to the grassroots level, the volume and value of transactions would increase in the years to come.

To sum up, the demonetization exercise is a move towards making India a ‘less cash’ economy. At the end of the day, an economy where all major economic transactions take place through the electronic mode is the first step towards arresting the generation of unaccounted money. This, in turn, would lead to a change in the composition of M1, or narrow money supply. The proportion of ‘currency in circulation’ would see a declining trend and the share of ‘demand deposits with banks’ would see an increase.

over time, the inflation in the economy would either be determined equally by the currency in circulation as well as demand deposits with banks, or more by demand deposits with banks as compared to currency in circulation.

CoVER SToRy


MINDSPACE

policy advocacy

It is apparent that the Government will not remain satisfied by a business-as-usual approach to policy-making. Several big ideas have been implemented

that have changed the course of the economy. Besides demonetization, which is having a widespread impact, the Goods and Services Tax (GST), the merger of the Railway Budget with the general Budget, and its early presentation, are major changes being implemented this year.

CII has put together a set of policy ideas which it feels will have a major impact on the economy, if implemented. Since there may be a temporary setback to the growth momentum due to demonetization, it is especially important to consider measures that will kick-start investment and generate employment in the country.

revive investmentsFixed capital formation as a ratio of GDP has been declining. In recent times, the share of private sector investments has been declining, with no signs of early improvement. This is because of low levels of capacity utilization, due to the lack of demand, both domestic as well as global.

Since there is unutilized capacity in the private sector, the Government needs to step up the capital investments

some Big ideas for the union Budget

With the Union Budget on the horizon, CII has put together a set of policy ideas which it feels will have a major impact on the economy, if implemented.

Post demonetization, it is especially important to consider measures that will kick-start investment and generate employment in the country.

our second lead feature offers some suggestions to the Finance Minister, on industry expectations from the Union Budget, as well as on reforms like GST, and regulations such as GAAR and PoEM, towards making India an attractive investment destination, and enabling ‘Make in India.’


to create demand and kick-start the investment cycle. CII has suggested the following actions for the Government:

accelerate Psu disinvestment: The Government should raise funds from divestment in Public Sector Undertakings (PSUs), an old and well known means of additional resource mobilization for capital expenditure. By 31 December 2017, the Government should target divestment (and privatization in a few viable cases) of at least 100 PSUs, including the 74 identified by the NITI Aayog.

implement the dr Kelkar Committee recommendations on PPP: The main issue that Private Public Partnership (PPP) projects face today is disputes, which have affected the implementation of many projects. The Government should target redressal of all existing disputes in PPPs through appropriate dispute resolution mechanism by 31 December 2017.

asset recycling: The Government should recycle existing Government assets. For example, the Railways has opened up the development of railway stations on a PPP basis. CII suggests that 50 rail stations could be tendered for modernization and development around the country by December 2017.

employment: We need to reduce the effective cost of creating good quality jobs.

While there has been a moderate growth revival, an important point to note is that this has been jobless growth, without any significant job creation. The jobs created have been in the informal services and contract jobs.

The main constraint in creating jobs is a rigid labor law regime which was designed to protect labor, but is actually acting as obstacle for creating jobs. Rigid labor laws and arbitrary increases in minimum

wages have not helped create jobs and have led to over-regulation.

Therefore, it is of paramount importance that Government should focus on enabling legislation for job creation by allowing for fixed term employment with all benefits to the workers, and flexible labor practices. CII suggests the following:

• For existing firms: The Government should extend the policy framework provided for textiles and apparel to all sectors. This provides for fixed term employment and State provision of employers’ PF contribution in year one.

• For new firms: There is a need to move from subsidies and incentives to removing the burden of State regulation on start-ups. This can enable the creation of 10 million start-ups in the next 5 years by allowing these new start-ups to comply with regulations through self-declaration for all interface with the State for the first 5 years. The definition of a start-up shall be any firm less than 5 years old, with no further qualification.

innovation-led economyTo lay the foundation for innovation-led growth, it is important to build an innovation ecosystem in the country and target innovation-driven industrial growth. To establish such an ecosystem in the country with industry participation, CII suggests:

• Build a national technology strategy between Government and industry.

• We need to substantially increase investment in technology, by firms in in-house R&D, and by the State in research done in the Higher Education sector.

Public investment in research in the Higher Education sector is 0.04% of GDP, which needs to increase tenfold to the global average of 0.4%. Similarly, private sector investment in in-house R&D which is currently 0.3% of GDP, needs to increase fivefold to the global average of 1.5%.

• Create a National Innovation Fund with a corpus of at least `10,000 crores. The Government has `8,000 crores in the Consolidated Fund of India collected through the cess on technology imports, which can be used for this. Firms can be awarded on the basis of competitive proposals judged by peer review.

• The State provides abundant funds, around

34.3 33.431.6 30.8

29.327.7

0

5

10

15

20

25

30

35

40

2011-12 2012-13 2013-14 2014-15 2015-16 1H 2016-17

Gross Fixed Capital Formation (% of GDP)

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`90,000 crores, for research in autonomous laboratories. The funding to these labs should be fixed at the current nominal level. The increase should be provided to fund research in public higher education institutions.

Corporate tax and incentivesIndia currently has one of the highest corporate tax burdens among comparable jurisdictions. CII welcomes the Finance Minister’s proposal to lower the tax rate. Currently, the combined tax after considering the corporate tax rate, surcharge and cess is around 34%.

CII proposes that corporate tax be brought down to 18%, including all surcharges and cess. In return all tax incentives and concessions can be removed, with no grandfathering of previous incentives.

CII’s calculations of PBT and tax foregone in 2014-15 indicate an effective rate of 19.8% without any tax incentives or concessions. We believe that in the past, when corporate tax has been lowered, corporate tax collection has gone up. An 18% corporate tax should therefore not lead to revenue loss to the Government, and, in a stroke, move us away from a high tax, high concession regime.

This will bring India in line with the most attractive international investment destinations such as Singapore (17%), Sri Lanka (15%), UK (20%) and Russia (20%).

It will send a powerful message to Indian industry and global investors that India is an attractive investment destination and would also be a huge enabler for ‘Make in India.’

The Finance Act 2016 deferred the implementation of the Place of Effective Management (PoEM) based on the

residence test by one year. It is to apply from the Financial year 2016-17. Transactions pertaining to the period starting from 01-04-2016 will be evaluated as per the provisions of PoEM. The Government is yet to notify the income computation mechanism in the case of a foreign company having a PoEM in India.

CII has submitted the following suggestions:

• The PoEM guidelines should further provide a safe harbor provision for companies listed outside India on any of the recognized stock exchanges. This would be effective in avoiding unnecessary compliance burden with no corresponding tax collection in India.

• To remove the possibilities of double taxation, the guidelines on PoEM should clearly provide a mechanism for claiming Foreign Tax Credit (FTC) in case a foreign company creates a PoEM in India.

• In the absence of guidelines, the implementation of PoEM should be deferred to the next financial year in order to facilitate a smooth implementation and compliance with the PoEM provisions.

• A better solution which balances tax administration and tax-payer concerns is the introduction of controlled foreign company (CFC) rules, instead of actively pursuing the PoEM route.

A CFC rule aims to target situations where a foreign company owned and controlled by Indian resident shareholders accumulates passive incomes abroad. A CFC rule targets such deferred incomes of the foreign company by deeming them to be the income of the Indian shareholder and taxing it in his hands. Such a rule does not make the foreign company an Indian taxpayer, but isolates its passive income, and taxes such income in the hands of the Indian resident shareholder.

Place of effective Management (PoeM)


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General Anti Avoidance Rules (GAAR) is basically a set of rules designed to give Indian authorities the right to scrutinize tax

transactions which they believe are structured solely to avoid taxes. The rules would be applicable to all taxpayers. If GAAR starts in India, any transaction that carries a tax benefit could be questioned. The taxman may potentially want to know whether the transaction was done in the normal course of business or conducted simply with an intention to avoid taxes.

The provisions of General Anti Avoidance Rules (GAAR) are contained in Chapter x-A of the Income Tax Act, 1961, which shall be effective from assessment year 2018-19 onwards, i.e. financial year 2017-18 onwards.

The Government has not yet released the final guidelines on GAAR. CII has represented that GAAR draft guidelines be issued at the earliest for industry feedback.

CII has made the following recommendations to be considered while formulating the draft guidelines:

• To rule out inconsistencies, GAAR should not be applied to deny treaty eligibility in a case where there is compliance with the limitation of benefits (LoB) test of the treaty. The LoB article in the treaty limits the benefits of the treaty to the residents of the treaty country, and residents with sufficient connection to the treaty countries.

• To avoid retrospective applicability of the stringent anti-avoidance GAAR rules, all arrangements entered into prior to the date of introduction of GAAR should be grandfathered.

• The term ‘tax benefit’ should be explained by giving illustrations. This would reduce the chances of dispute, once the new regulation is implemented.

• CII has submitted that a specific and explicit clarification be provided that the onus should be on the tax authorities to demonstrate that the main purpose of an arrangement is to obtain tax benefit. In other words, it should not be a case where the practical application of GAAR results in a situation where the taxpayer is considered 'guilty until proved innocent.' This assurance is extremely critical to give comfort to taxpayers that GAAR will be used selectively in deserving cases only after the tax authorities have garnered enough factual evidence to support their case for the existence of tax avoidance.

General anti avoidance rules (Gaar)

January - March 2017

19 - 21 January, 2017 | GurgaonWorkshop on Geometric Dimensioning and Tolerancing (GD&T)

23 - 24 January 2017 | Chennai7th TPM Circle Competition

24 - 25 January 2017 | MysoreTraining Program on Jishu Hozen Implementation

30 - 31 January 2017 | PuneAchieving Zero Break Down: Workshop on Planned Maintenance

30 - 31 January 2017 | MumbaiWorkshop on Internal Auditing for Inspection Bodies based on ISO/IEC 17020:2012

6 - 10 February 2017 | Chennai20 - 24 February 2017 | GurgaonLean Practitioner & Six Sigma Green Belt

16 - 17 February 2017 | MumbaiTwo day workshop on Lean – The Toyota Way

21 - 24 February 2017 | TirupatiCertification Course on Lean Manufacturing - The Toyota Way

22 - 24 February 2017 | ChennaiWorkshop on Reliability Maintenance

23 - 24 February 2017 | BangaloreSchool Excellence Conclave

17 - 18 March 2017 | ChennaiHigher Education Conclave

20 - 24 March 2017 | SingaporeCII School Excellence Mission

[email protected]


MINDSPACE

Goods and services tax

The Goods and Services Tax (GST) is the most transformative and far-reaching reform to India’s

indirect tax system since Independence. After the Government came out with the Model GST law, CII offered its recommendations on this model law to the Government and the empowered committee. The key recommendations are:

• The current situation does not allow the possibility of having a single GST rate, and therefore, a beginning has been made with multiple rates. However, there should be an absolute limit of four rates. In fact, over time, the Government should commit to converge to one plus two rates. Also, it is important that the categorization must be completely non-discretionary, and the same category of goods must not attract different rates, else it will open avenues for discretion, interpretation and disputes, instead of simplification under the GST regime.

• The Government justifies the need for creating a source of funding to compensate the States, which might have a shortfall in the initial stages of GST. We understand that there would be a cess levied by the Center at a single stage, which may be different for each demerit good, and will not be creditable.

C l a r i t y i s required as to at what stage this cess will be applicable. It is suggested that the cess b e l e v i e d only at the final product / consumption stage. Further, t o t a l t a x , i n c l u d i n g the cess on

demerit goods, should be kept within the present overall indirect tax incidence. The Government should also roll out a clear roadmap for early withdrawal of the cess once the buoyancy in tax collection becomes adequate to compensate the States for any shortfall that they might have.

• Multiple registrations in each State for the supply of goods and services will lead to serious complexities, increase in compliances (registrations, audits, etc), particularly for services sectors such as banking, insurance, telecom, consulting, airlines, e-commerce, etc. which have pan-India operations. It is suggested to have a single registration process as a centralized registration with credits to the States given through the IGST mechanism. This will significantly lead to simplified and better tax compliance and support the Government’s efforts to improve ‘ease of doing business.’

• The valuation provisions, especially for related party and inter-state self-supply transactions, are very stringent and are attuned to valuation currently used under excise and customs. It is suggested that the invoice value should be accepted for the payment of GST.

CII believes that the introduction of GST would usher in a system where evading indirect taxes would become very difficult. Therefore, the overal l tax collection would be much higher over time. This would thus afford the Government the opportunity to take bold decisions.


sectorscape

ANational Conference on ‘Accounting Reforms in Indian Railways - A Strategic Mission for Sustainable Growth’ was organized by the

Ministry of Railways, in partnership with CII, on 20 December in New Delhi. Mr Arun Jaitley, Minister of Finance, and of Corporate Affairs, was the Chief Guest, while Mr Suresh Prabhakar Prabhu, Minister of Railways, delivered the keynote address.

The conference was held to share the expectations and perspectives of various stakeholders, including investors, lenders, industry, and professionals, on the Accounting Reforms project of the Indian Railways, including the expected benefits from the transition, and the way forward.

Mr Arun Jaitley spoke about the challenges facing Indian Railways on account of rising competition from other modes of transportation, especially roadways and airlines. He called on Indian Railways to aim for professionalism rather than populism, and focus on its core competencies and not businesses which do not form the primary activity of providing transportation services. While, the world over, the financial model

followed by the transport sector is based on customers paying for the services they receive, Indian Railways, by not following this model, is getting caught in its own trap, he said. Urging Indian Railways to act like a competitive service to become a world-class transportation system, he welcomed the undertaking of the Accounting Reforms project and advised that the accounting system must reveal rather than conceal the true financial health.

The accounting system is like a health card of an organization which reflects its financial health, said Mr Suresh Prabhakar Prabhu. Accounting Reforms is a massive project and is not just confined to accounting from single entry to double entry, and conversion from cash to accrual accounting: it is an integrated project covering performance costing and outcome budgeting. The system should aim at linking the outlays to outputs and outcomes, and should lead to ‘accounting for accountability,’ he said, observing that “we cannot have an appropriate pricing mechanism if we cannot determine our cost of services.” He called on Indian Railways to adopt a cost center and profit center

rakesh Bharti Mittal, Vice President, Cii, and Vice-Chairman, Bharti enterprises; shahzad shah, financial Commissioner (railways); arun Jaitley, Minister of finance, and of Corporate affairs; suresh Prabhakar Prabhu, Minister of railways, and B n Mohapatra, additional

Member (finance), Ministry of railways, at the national Conference on ‘accounting reforms in indian railways’ in new delhi

railways

accounting reforms in indian railways


SECToRSCAPE

approach to ensure correct allocation and utilization of resources, and assess the performance of each center on an individual basis.

Mr Shahzad Shah, Financial Commissioner (Railways), spoke of the changing needs of the finance manager in an ever-evolving complex business environment, which includes adapting to changing environments, building capabilities to use innovative technologies and data analytics, and broadening the skill set of the team.

The need for Accounting Reforms in Indian Railways arises primarily for three key reasons: availability of comprehensive and meaningful financial information, need for a responsive and reliable costing framework, and meeting the funding requirements of Indian Railways, explained Mr Naresh Salecha, Adviser (AR), and Mission Director. The vision of Accounting Reforms in Indian Railways is centered around meeting the stakeholders’ expectations through right accounting, right costing and right outcome, with an integrated framework for performance costing and outcome budgeting, he added. He also shared the plans to replicate the pilot study undertaken at North Western

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Railway in all Zonal Railways and production units.

Mr Rakesh Bharti Mittal, Vice President, CII, and Vice-Chairman, Bharti Enterprises, reiterated that Indian industry would continue to partner the restructuring of Indian Railways as envisaged by the Government.

Mr B N Mohapatra, Additional Member (Finance), Ministry of Railways, and Mr M Devaraja Reddy, President, Institute of Chartered Accountants of India, also spoke.

Mr Arun Jaitley and Mr Suresh Prabhakar Prabhu released three publications on the occasion, which are the outcomes of the pilot study undertaken by Indian Railways at North Western Railway:

• Accrual-based Financial Statements of North Western Railway

• Significant Accounting Policies

• Accrual Accounting Implementation Manual

The conference featured three technical sessions, presenting investors’ perspectives, practitioners’ needs and expectations, and opportunities and challenges, respectively. The sessions included brief video presentations to share global best practices.


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Industry needs to not just develop technologies but also master them in India, stated Mr Manohar Parrikar, Minister of Defence, inaugurating the Army

Technology Seminar on ‘Common Technologies and Advanced Materials for Land Systems,’ jointly organized by CII and the Indian Army in New Delhi on 5 December. The Minister called for joint collaborative efforts by the Defence Research and Development organization (DRDo) and industry to not only develop and master technologies for the future, but also develop full command over current technologies. He also released a compendium of ‘Future Technologies and Statement of Problems’ prepared by the Indian Army.

The compendium, an outcome of detailed iterations carried out with major stakeholders, such as the Field Army, training institutions, and planning establishments, dwells on ‘Felt Needs’ and ‘Future Core Technologies’ as pertaining to various domains, to explore suitable solutions. These include armored fighting vehicles, night vision and power packs / engines, combat soldiers, artillery, combat engineering, future technologies, information and communication technology, army air defence, and army aviation. The compendium also includes 50 problem definition statements related to these technologies.

Gen. Dalbir Singh, then Chief of Army Staff, reiterated the Indian Army’s quest for modernization through

indigenization. He emphasized that a very sound technology base and an equally strong industry base are prerequisites for a robust and sustainable security apparatus. Echoing the views of the Defence Minister, he pointed out that at present a large number of items essential for keeping equipment operational are being imported. Therefore it is crucial to develop ‘functional level technologies’ to create indigenous support. Numerous interactions have been carried out with academia, R&D establishments and industry to identify and define the major challenges, which could then be worked upon, he said.

Dr S Christopher, Secretary, Department of Defence R&D, and Chairman, DRDo, said the DRDo can only help in the development of defence equipment; industry has to convert it into production. The inclusion of private defence industry partners in the strategic technology acquisition process needs no elaboration, he said.

In his keynote address, Gen Bipin Rawat, Chief of Army Staff, (then Vice Chief of Army Staff) highlighted the Indian Army’s commitment to achieve greater self-reliance through indigenous research and development efforts. The technology threshold of a nation is a tool of strategic dominance in the sphere of global power play, and can neither be overlooked nor understated, he said.

Technology is crucial for the development of capabilities and systems to meet desired future operational

defence

Chandrajit Banerjee, director General, Cii; General dalbir singh, PVsM, uysM, aVsM, VsM, adC, then Chief of army staff, indian army; Manohar Parrikar, Minister of defence; dr s Christopher, secretary, department of defence r&d, drdo; Gen Bipin rawat, uysM, aVsM, ysM, sM, VsM, Chief of army staff, (then Vice Chief of army staff) indian army; and Baba n Kalyani, Chairman, Cii national Committee

on defence, and CMd, Bharat forge ltd, at the army technology seminar in new delhi

army technology seminar


efficiency, said Mr Baba Kalyani, Chairman, CII National Committee on Defence, and CMD, Bharat Forge Ltd. The strategy should be to ensure linkages between capability development, military systems and technology, he added.

19th defence acquisition Management Course

The Defence Acquisition Management Course (DAMC) enables greater participation of industry (both foreign and domestic) in defence production and also familiarizes industry about the latest defence procurement policies and procedures. The 19th edition of the course was organized on 1-2 December in New Delhi.

opportunities and Challenges in defence ManufacturingThe ‘Make in odisha’ Conclave featured a session on ‘opportunities and Challenges in Defence Manufacturing: odisha Perspective,’ on 2 December in Bhubaneswar. Addressing the session, Mr Ashok Kumar Gupta, Secretary, Defence Production, Ministry of Defence, invited investments in India’s defence production sector, highlighting the Government’s vision to achieve self-sufficiency. A liberalized FDI regime and relaxed norms are making the sector more attractive to foreign companies, he added. Defence Public Sector

Undertakings are being encouraged to step up the level of sub-contracting, especially to MSMEs, to help them develop their capabilities, he said.

Lt Gen Subrata Saha, UySM, ySM, VSM, Deputy Chief of Army Staff (Planning & Systems), Indian Army, said a good amount of equipment, including the ultra-light Howitzer guns from the US, and future ready combat vehicles, are being assembled or manufactured in India, building up capacity and capability in the country.

Dr B K Das, Director, Integrated Test Range (ITR), Chandipur, highlighted the advantages odisha offers to defence manufacturers, and invited companies to invest in the Defence and Aerospace SEZ being set up in Gopalpur by Tata Steel.

interaction with Bangladesh defence delegation

CII hosted a 13-member Bangladesh defence delegation led by Maj General Hamidur Rahman Chowdhury, RCDS, PSC, Commandant Bangladesh ordnance Factories, in New Delhi on 9 December. The delegation, with participants from the Army, Navy, Air Force, Ministry of Defence, Ministry of Defence and Federation of Bangladesh Chamber of Commerce and Industry, was briefed about the Indian procurement procedures, and also the opportunities and capabilities of the Indian defence industry. The session was chaired by Mr Ashok Kanodia, Co-Chairman, CII SME Sub-Committee on Defence, and Chairman, Precision Electronics Ltd.

at the session on ‘opportunities and Challenges in defence Manufacturing’ during the ‘Make in odisha’ Conclave in Bhubaneswar

rear admiral Pritam lal (retd), Course director; lt Gen subrata saha, uysM, ysM, VsM, deputy Chief of army staff (Planning &

systems), indian army; and Col sukhvindar hayer (retd), Chairman, Cii sub Committee on r&d, and Ceo, defence land systems india

ltd, at the 19th edition of the defence acquisition Management Course in new delhi

interaction with defence delegation from Bangladesh, in new delhi

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healthcare

The overall Indian healthcare market today is worth $100 billion and is expected to grow to $280 billion by 2020, with a Compound Annual Growth

Rate (CAGR) of 22.9%, due to rising population demand and increasing affordability. Government spending on public health is expected to increase through its disease-specific programs, focus on immunization and non-communicable diseases, and expenditure on healthcare infrastructure.

Social healthcare innovations are here to stay and will become increasingly relevant for all key stakeholders – the Government (as payer and enabler, as opposed to provider), private providers (large, small and standalone),

industry, and consumers. At the same time, the use of data-driven frameworks will serve the research and innovation constituents of healthcare.

The emergence of disruptive technologies is likely to aid care delivery, and develop consumers who are more informed, engaged, discerning and value-conscious. Buoyant trends in health start-ups, m-health, technology adoption in diagnostics and medical technology, digital health, research in genomics, et al, are set to change the Indian healthcare landscape and patient outcomes.

There are huge opportunities for emerging players in areas such as upgraded secondary care chains, large concepts like medi-cities, integrated healthcare

reimagining indian healthcare

sabahat s azim, founder, Ceo & Md, Glocal healthcare systems; dr a Velumani, CMd & Ceo, thyrocare technologies ltd; Jagat Prakash nadda, Minister of health and family Welfare; dr naresh trehan, Chairman, Cii healthcare Council, and CMd,

Medanta - the Medicity; rahul Khosla, Co-Chairman, Cii healthcare Council, and President, Max Group, and Chairman, Max india; shobana Kamineni, President designate, Cii, and executive Vice-Chairperson, apollo hospitals enterprise ltd, and dr dharminder nagar,

Md & Ceo, Paras hospitals, at the 13th india health summit in new delhi

rahul Khosla, dr Jitendra singh, Minister of state (independent Charge) of doner, and Minister of state of PMo,

Personnel, Public Grievances and Pensions, atomic energy, and space, and dr naresh trehan

SECToRSCAPE

anupriya Patel, Minister of state of health and family Welfare; shobana Kamineni, and

Paresh Parasnis, head, Piramal foundation


‘I urge private institutions to establish their outfits in rural and semi-rural areas to ensure accessibility to people there, and also to make the cost of treatment affordable.

At the same time, it should be an economically viable proposition for the hospitals also to function from such centers.’

Jagat prakash nadda, Minister of Health and Family Welfare

‘We should not look at medical education from the prism of 1947. We have to evolve pragmatic policies to meet the supply side of medical professionals. The focus should be on aptitude and commitment.’

dr Jitendra singh, Minister of State (Independent Charge) of DoNER, and Minister of State of PMo, Personnel, Public Grievances

and Pensions, Atomic Energy, and Space

‘Public-private partnership is the key to achieve universal healthcare, since India has more challenges in the health sector than most countries because of its huge population and tardy coverage of health programs. There are higher expectations from the people. We have to involve all segments of the population to realize our true potential.'

anupriya patel, Minister of State of Health and Family Welfare

‘India’s pitch for achieving 9 to 10% annual growth would remain a far cry if radical reforms are not brought about in the health sector. Unless the overall health performance goes up, India would remain far below in the global health reckoning.’

amitabh Kant, CEo, NITI Aayog

‘The right to medicare would entail more allocation from the Government for health-related areas. The Government is spending, but not enough to unlock the potential for reaching out to the people through disruptive technologies.'

shobana Kamineni, President Designate, CII, and Executive Vice-Chairperson, Apollo Hospitals Enterprise Ltd

‘Investment in the health sector should be treated like in any other sector. Now there is a thick wall between the Government and the private sector in healthcare. We need to evolve imaginative schemes wherein both can work together for achieving the common goal.’

dr naresh trehan, Chairman, CII Healthcare Council, and Chairman and Managing Director, Medanta - The Medicity

ecosystems, large day-care surgery centers, consolidation of unorganized hospitals to achieve cost effectiveness, diagnostics and clinical peripheral services, medical technologies, digital healthcare, and medical value travel.

Complementing these trends is the move towards a review of policies to create an environment to facilitate partnerships.

With Indian healthcare poised to evolve substantially over the coming decade, it is one of the most exciting times to be in India for investment in healthcare, for collaborations and partnerships. CII therefore organized the 13th edition of its annual flagship India Health Summit, with the theme ‘Innovations and Disruptions – Reimagining Indian Healthcare,’ on 15 December in New Delhi.

This year, a new addition at the event was the ‘Experience Center,’ a dedicated area for innovators and start-ups to present their products through live demos, showcasing the limitless possibilities for digital healthcare to transform healthcare delivery in India. Leveraging creative talent and innovative technologies, the Center enabled dialogue and interaction between innovators and healthcare stakeholders at a deeper level in an objective, off-enterprise, off-campus sandbox environment.

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BYtes


SECToRSCAPE

over the years, handloom has moved from a freedom fighter’s identity fabric to a fashion garment. It has now found its place in Indian

middle class society and gradually moved into corporate boardrooms. Modernity in fabric is essentially about functionality and tasteful restraint. Handloom has the potential for both.

‘I wear Handloom,’ the recent initiative of the Minister of Textiles, has been appreciated by not only the political leadership or the bureaucracy of the country, but also corporate India. The initiative emphasizes the focus of the Government and the growing recognition of the handloom sector, which, despite challenges, offers a diverse design base with adaptability for new designs, skilled labor, and traditional modes of production with low power, eco-friendly technology and processes, and informal modes of skill generation.

To address the challenges and discuss solutions, CII, in close partnership with the office of the Development Commissioner - Handlooms, organized a Conference and Exhibition ‘Creating Handloom 2.0 – Realizing the potential of Indian Handloom Industry’ on 12 December in New Delhi, to mainstream the handloom industry. The conference discussed three major intervention areas: branding, design, and the institutional framework required for promoting the handloom industry.

Every weaver has his or her unique designs and

realizing the Potential of indian handlooms

‘Handloom is our legacy. Its potential needs to be positioned and acknowledged, not only domestically but also globally.’

smriti Zubin irani, Minister of Textiles

‘Proper branding and publicity can scale up the sector’s exports by 4-5 times in the next 5 years.’

alok Kumar, Development Commissioner – Handlooms

‘Steps like demonetization are required to take Indian handlooms global.'

Jaya Jaitly, Founder & President, Dastkari Haat Samiti

sarada G Muraleedharan, director General, national institute of fashion technology; ritu Beri, advisor, Khadi and Village industries Commission; smriti Zubin irani, Minister of textiles; Gautam nair, Co-Chairman, Cii national Committee on apparel, and Md, Matrix Clothing Pvt. ltd, and

alok Kumar, development Commissioner– handlooms, Ministry of textiles, at the conference on ‘Creating handloom 2.0' in new delhi

smriti Zubin irani at the exhibition on 'Woven Wonders of india'

s t R a n d s

textiles & apparel


craftsmanship which need to be protected and acknowledged. It is important to ensure a framework where Intellectual Protection Rights can be introduced and ensured for handloom weavers, said Ms Smriti Zubin Irani, Minister of Textiles, addressing a Special Session at the conference.

When the industry comes together with the weaver, an expeditious journey can take place, she said, citing the example of Biba, a domestic retail brand, which procured 2 lakh meters of handloom cloth in August and came up with two new collections in November. Already, 60 natural and chemical-free dyes have been registered under the ‘India handloom brand’ launched by the Prime Minister, she said.

M r A l o k K u m a r, D e v e l o p m e n t Commissioner – Handlooms, Ministry of Textiles, pointed out that with structured interventions in skills, technology, design and innovation, branding and marketing, the sector has the potential to scale up to a market size to about `4 lakh crores from the estimated size of `1 lakh crores at present in the next 6-7 years. This would further help in releasing 5-7 times higher wages to the artisans, he added. With proper branding and publicity, handloom exports can be scaled up at least 4 to 5 times in the next 5 years, he said.

Key takeaways

• Handloom tourism can be an effective vehicle to promote the industry.

• Made-up is the next entity in the handloom sector, with immense potential.

• The current devolution of power with the 13th Finance Commission gives the States a greater role to play.

• Industry support is required to bring in market intelligence, and strengthen marketing linkages, with reduced intermediation.

• Getting a global footprint requires an approach of ‘co-creation’ to contemporize, where the weaver and designer both come together to designer and innovate.

SECToRSCAPE

luxury

dialogue on luxury

The 5th chapter of the annual CII-ET Dialogue on Luxury, held on 9 December in New Delhi, was packed with insightful sessions led by some of the biggest names in luxury. The discussions

spanned the many facets of the booming Indian luxury sector, right from its origins, challenges, and shift from offline to online retail, to trends, marketing strategies and solutions to help drive the sector to achieve its true potential.

The inaugural session offered an in-depth look at the industry by Mr Nakul Anand, Executive Director, ITC Ltd; Ms Ritu Beri, celebrated fashion designer; Mr Sanjay Kapoor, Executive Chairman, Genesis Group; Tikkarani Shailaja Katoch, erstwhile princess of the former royal family of Kangra, and Mr TK Arun, Editor, opinion, The Economic Times. The session explored India’s rich and glorious heritage, back to the days of royalty, who were in fact the first ambassadors of Indian luxury. With some of the most sought-after arts and crafts and a young and robust economy waiting for its moment of glory, it is now time for brand India to take its rightful place on the global luxury map, said the speakers. They highlighted the need for the industry to recognize and adapt itself to the customer, and his/her evolving wants and perceptions, and inculcate a sustainable and responsible approach to business.

Mr TK Arun, in his welcome address, remarked that even though demonetization had affected the sector, several sub-sectors, such as hospitality, had remained stable. Stressing on the timeless value of Indian luxury, he urged stakeholders to embrace innovative marketing strategies to make the ‘India statement’ in global luxury.

Luxury goes much beyond the mere accumulation of wealth, to encompass an entire gamut of experience involving refinement, taste, happiness, desire, and fantasy, said Mr Nakul Anand. While the 25% growth rate and the current $18 billion are most encouraging, luxury in the future has to be ‘experiential,’ delivering a holistic experience to the consumer, with uncompromising attention to quality, ethics, and responsibility towards the environment and to the artisans who create luxury, he said.

Ms Ritu Beri urged luxury stakeholders to follow the Japanese model and strive towards global perfection in manufacturing while retaining a distinct national flavor.

Tikkarani Shailaja Katoch spoke of the classic elegance of the royals of India’s past while Mr Sanjay Kapur discussed the future roadmap of the burgeoning luxury market in India.


SECToRSCAPE

In the opening session on ‘The Luxury Connect,’ Ms Laila Tyabji, Co-founder, Dastkaar, said the current buzzwords should be ‘Skill India’ and ‘Make in India,’ with the focus on sustaining the Indian artisan and thereby preserving India’s vast repository of skills. The other panelists, Mr Rajesh Pratap Singh, leading fashion designer; Mr Amit Rawal, Head, Luxury Business, TataCLIQ Luxury; Ms Anahita Dhondy, celebrity chef; and Mr Varun Rana, journalist, The Times of India, reinforced the idea of going back to our heritage, age-old skills and acumen, be it in apparel, jewelry, or cuisine, in both manufacturing techniques and online business.

The second session of the day explored the challenges plaguing the luxury industry in India. These include the perception and reservations of customers towards purchasing luxury products and the high cess levied on luxury goods. Alongside, there is increasing penetration of online luxury, thanks to the growing number of internet users and the proliferation of the market in tier 2 and 3 cities. The panelists included Mr Frank Schloeder, President (ACT), BMW Group India; Ms Simi Dewan, Brand Head - India, L’occitane India; Mr Nikhil Mehra, CEo, Genesis Group; Ms Vinu Sundaresan, CEo and Founder, Vmobo.inc; and Mr Amit Dutta, MD, LuxuryHues.

tikkarani shailaja Katoch of lambragaon, Kangra; nakul anand, executive director, itC ltd; t K arun, editor, opinion, the economic times; sanjay Kapoor, executive Chairman, Genesis Group, and ritu Beri, fashion designer, at the ‘dialogue on luxury’ in new delhi

An important point that emerged was that the Indian consumer was now fully aware of global pricing and would rather pay less overseas than pay extra along with the luxury cess in India.

luxury CapitalIn a session dedicated to Italy, the nation which represents the quintessence of luxury, Mr Lorenzo Angeloni, Ambassador of Italy to India, in his keynote address, suggested the development of smart cities with luxury shopping precincts, like in Milan. Sustainable luxury conducted within environment-friendly cities is required, he said, stating that Italy is ready to collaborate with India to create platforms for fruitful dialogue between industry stakeholders and students and innovators of luxury, to translate business ideas into reality.

Mr Francesco Pensabene, Trade Commissioner to India, Embassy of Italy; Ms Pernia Qureshi, fashion entrepreneur; Ms Sunaina Anand, Director, International Real Estate Expo; and Ms Seetu Kohli, MD, Ace Maison, participated in the session, which took a close look at measures that could help India establish itself as a center for luxury, by producing smart, beautiful and sustainable products and experiences.

The session on 'Technology Trends in Luxury Market' looked at the influence of rapid digitization and social media. This session was moderated by Ms Vandana Bhandari, Professor, NIFT, with speakers including Mr yashovardhan Saboo, CEo, Ethos Watch Studios; Mr Sharad Agarwal, Head, Lamborghini India; Mr Vivek Ramabhadran, MD, Swarovski; and Ms Priya Sachdev, Founder and CEo, Rocknshop.com.

The conference ended with a freewheeling chat between couturier Rohit Bal, Ms Pernia Qureshi and stylist Gautam Kalra, to explore the connection between fashion, style and luxury, sending out the message that luxury transforms the ordinary into the extraordinary.

seetu Kohli, Md, ace Maison; lorenzo angeloni, ambassador of italy to india; francesco Pensabene, italian trade Commissioner and

coordinator for india, and Pernia Qureshi, fashion entrepreneur


The dairy industry in India is poised for a threshold leap. The path is very clear. It has to move to the forefront from its present position,

where it is perceived as a subsidiary to agriculture. Nearly 70% of agriculture farmers double up as dairy farmers, and keep a large part of the milk they get for their own consumption. The dairy industry has some latent advantages that have worked for it so far, but has now reached a stage where a greater influx of technology and dairy farming processes is imperative.

To discuss the present status of the Indian dairy industry and its preparedness to meet future milk demands, the CII National Committee on Dairy organized a roundtable on the ‘Role of Dairy in Enhancing Farmers’ Income’ on 12 December in New Delhi. The session was chaired by Dr H Rahman, Deputy Director General – Animal Sciences, Indian Council of Agricultural Research (ICAR), along with Mr Siva Nagarajan, Chairman, CII National Committee on Dairy, and MD, Mother Dairy Fruits and Vegetables (P) Ltd, and Mr Mayank Jalan, Co-Chairman, CII National Committee on Dairy, and MD, Keventer Agro Ltd.

Highlighting the need for all stakeholders to work together in a very concerted way to make the dairy sector a vehicle for social and economic transformation,

role of dairy in enhancing farmers’ income

shraman Jha, director – Market access, elanco india (P) ltd; siva nagarajan, Chairman, Cii national Committee on dairy, and Md, Mother dairy fruits and Vegetables Pvt. ltd; dr. h rahman, deputy director General – animal sciences, iCar; a nanda Kumar,

director – Cattle health, department of animal husbandry, fisheries & dairying; and Mayank Jalan, Co-Chairman, Cii national Committee on dairy, and Md, Keventer agro ltd, at the roundtable on the dairy industry in new delhi

food & agriculture

the experts pointed out that India’s indigenous breeds are versatile, can produce a good quality of milk, and are not likely to be impacted by climate change. India has a lot of headroom to enhance milk production through better milk productivity, they said, which will mean more milk available for the market, and will help in generating income for the farmers, aligned with the stated policy goal of the Government to double their incomes.

The discussions called for greater engagement of industry and Government with farmers to strengthen strategies related to cattle health, including feed and fodder availability and quality, vaccination regimes and disease forecasting, and develop skilling initiatives to provide technical know-how to reach the grass root level. A strong procurement system which also addresses quality and assures adulteration-free dairy products to the customer is required, it was stressed.

The session was attended by subject matter experts from the National Dairy Development Board, Amul India, Schreiber Dynamix Dairy, Nestle India, Kwality Dairy, Chanakya Dairy, the Agriculture Skill Council of India, Reliance Dairy Foods, Elanco India, Carrier Transicold, dairy start-ups, and farmer representatives from iorganic and Binsar Farms, as well as dairy farmers.

SECToRSCAPE


Effecting systemic changes in our ecosystem and overhauling of administrative structures as well as strict enforcement of rules of law are crucial

to strike at the root of corruption. There is a demand side as well as a supply side to corruption, and both need equal attention, stated Mr K V Chowdary, Central Vigilance Commissioner, at the seminar on ‘Facilitating a Corruption-free Environment for Achieving High Growth’ organized by CII and the Vigilance Study Circle (Delhi & NCR) in New Delhi on 5 December. The seminar drew over 100 part ic ipants from the public and private sectors.

C i t i ng p rac t i ca l examples in areas such as po r t s , insurance, banks, land records, etc, Mr Chowdary spoke at length about how the opaqueness in the system spawned o p p o r t u n i t i e s fo r c o r ru p t i o n , and encouraged intermediaries to thrive. Public procurement is an activity which is highly prone to corruption, and has a serious impact on economy and industry, he said.

While leveraging the use of digital technology and automation is one of the preventive strategies to fight corruption, this in itself is not enough, felt Mr Chowdary. It needs to be complemented by improvement in governance structures to bring about transparency and accountability in the economy. Further, a free, fair and competitive market reduces scope for rent-seeking and discourages corruption. At the same time, measures to deal with corruption should be participative in approach, involving the contribution of all stakeholders. Inculcating the values of ethics and integrity would also help in reducing corrupt practices, he said.

Mr Kiran Karnik, Chairman, CII National Committee on Telecom & Broadband, and CII Mission on Digital India, and Former President, NASSCoM, in his keynote address, spoke of two types of corruption-exploitative

and collusive. Corruption is anti-competitive, he said, pointing out that companies which give bribes get an undue advantage over others. We need to promote fair competition to control corruption, he said.

Few will disagree that it is wiser to root out the cause, instead of merely tackling the symptoms, observed Mr Kiran Karnik. yet, he regretted, much of the movement against corruption has focused only on tackling the symptoms, the

manifestation, and not on eradicating the cause itself. He spoke about the use of technology to root out corruption, citing the example of computerization of land records. Digitization, a central data base and the ability to get an authenticated print-out of ownership from multiple points have together made the process easy and corruption-free, he said.

Mr M Radha Krishna, President, Vigilance Study Circle (Delhi & NCR), and Chief Vigilance officer, CPWD, Ministry of Urban Development, said a massive program has been started in India to eliminate corruption. Technology will play an important part in curbing corruption and this would cover e-procurement, e-payments, etc, with many major programs using mobile applications. At the recent Vigilance Awareness Week, where the focus was on public participation, many took a pledge not to engage in corruption, he said.

The CII Model Code of Conduct containing six basic principles has been adopted by many companies, said Mr Salil Singhal, Co-Chairman, CII Agriculture Council, and CMD, PI Industries Ltd, in his welcome address. Highlighting the need to facilitate business through ease of doing business, he expressed the hope that within the next three years, India’s position in the World Bank ranking would be within the top 50.

improved Governance will reduce Corruption

M radha Krishna, President, Vigilance study Circle (delhi & nCr), and Chief Vigilance Officer, CPWD, Ministry of Urban Development; Kiran Karnik,

Chairman, Cii national Committee on telecom & Broadband, and Cii Mission on digital india, and former President, nassCoM; KV Chowdary, Central Vigilance

Commissioner; salil singhal, Co-Chairman, Cii agriculture Council, and CMd, Pi industries ltd; and K M singh, CMd, nhPC ltd, at the seminar on

‘facilitating a Corruption-free environment’ in new delhi

INDIA INC

ethics


INDIA INC

corporate governance

The 11th Corporate G o v e r n a n c e Summit, held

on 17 December in Mumbai, highlighted the functioning of the board; interplay between the roles of the CEo, Chairman and the Board for developing strategy; cr i t ical oversight; focus on risk management, and honest interaction between the management and the directors, as key factors of governance.

observing that an atmosphere that allows for dissenting views is an important characteristic of a good boardroom, Mr Keki Mistry, Chairman, CII National Council on Corporate Governance, and Vice Chairman and CEo, HDFC Ltd, said there is universal acceptance by companies that sound principles of governance are necessary for the long term development and sustainability of a company. Giving examples, he emphasized that companies do not operate in a vacuum, and the contagious effect of a major business failure can be devastating for economies across the world.

In India, changes are taking place which are setting the foundation for the next stage of corporate growth, said Mr Mistry. The convergence of a number of favorable factors such as a committed Government at the center, fiscal consolidation, inherent economic strength, favorable demographics, and a strong work force, indicate that India will continue to be a key player on the global economic stage. Corporate India and regulators are striving to raise the bar on governance, he said. Acknowledging that most Indian companies have done rather well in maintaining governance standards, he cited examples of leading corporate houses that have stood the test of time, created wealth, diversified businesses, have not compromised on their core values, and have preserved a culture of accountability.

Delivering the multilateral partner outlook, Mr Pratip Kar, Former Executive Director, Securities and Exchange

11th Corporate Governance summit

Board of India (SEBI), and currently a Consultant with IFC and the World Bank, called for reflection on the various constituents of governance, like the role of the Board towards stakeholders, specifically shareholders, and the responsibilities of independent directors. Whether the Board sets the organizational culture, or settles into it, there is a need to sustain governance and harmonize it across the company, he said.

overall uncertainties in the business climate underscore the significance of corporate governance in organizations, said Mr Mritunjay Kapur, Partner & National Head, Risk Consulting, KPMG India. While we now have a strong regulatory framework, it is imperative for companies to create a culture of ethics and integrity, aligned to their strategic principles. The lack of robust corporate governance mechanisms and sound culture can have devastating consequences for business and reputation, he said.

Earlier, in his welcome remarks, Mr Robin Banerjee, Convener, CII Maharashtra Finance & Taxation Panel, and MD, Caprihans India Ltd, pointed to stakeholder satisfaction and fair-play as the primary objectives of governance. Fraud has now been made part of the Companies Act, 2013, he observed.

Speakers at the Summit commended CII for its sustained efforts in facilitating the enhancement of corporate governance standards in India. Various sessions deliberated on Board independence, the role of the Board in building ethical organizations; the changing regulatory scenario under the Companies Act and SEBI regulations, the challenges of compliance, the role of the Board in fraud management, and risk resilience.

Pratip Kar, former executive director, seBi, and Consultant, ifC and World Bank; Keki Mistry, Chairman, Cii national Council on Corporate Governance, and Vice Chairman & Ceo, hdfC ltd; robin Banerjee, Convener, Cii Maharashtra finance & taxation Panel, and Md, Caprihans india ltd; and Mritunjay Kapur, Partner & national

head, risk Consulting, KPMG india, at the 11th Corporate Governance summit in Mumbai


Rapid advances in technology are making it more challenging to predict the numbers and nature of jobs in the future. For India to address this

dynamic trend, job creation must stand at the center of all policy-making, according to the report ‘Future of Jobs in India – Enterprises and Livelihoods’ brought out by CII in December.

The report was prepared after months of consultations with over 170 experts and stakeholders, with the participation of the Department of Industrial Policy and Promotion (DIPP), and in association with the Boston Consulting Group, India. Guided by Mr Arun Maira, Former Member, Planning Commission, it offers directional strategies for promoting the creation of jobs by identifying emerging trends in technology and education, and the unique characteristics of enterprises in India.

The report was developed through a structured ‘systems approach’ of problem-solving, and outlines three potential scenarios for the next 10-15 years, depending on current policies. It goes beyond accepted theories to introduce new ideas and directional changes for job creation. The report identifies eight drivers of job creation and seven imperatives of ‘what to do’ and ‘how to do.’ Such a systems approach can add 2-3 percentage points to the GDP growth rate, it says.

Every year, 10-12 million young people join the labor force, and millions more leave agriculture, thus necessitating the creation of 17-20 million jobs per annum. With much fewer jobs actually created in the last 5-10 years, the cumulative impact and future job needs must be considered together.

networks and Clusters Effect ive c lus te rs , both geographic and virtual, can develop the capabilities of small enterprises and enable citizens to earn incomes with less capital expenditure, suggests the report.

Cii report on 'future of Jobs in india - enterprises and livelihoods'

The quality of small enterprise associations and clusters must be substantially improved. Giving the example of ola Cabs and oyo Rooms, it says Government policies should aim to strengthen and enable digital technology platforms and communications networks to empower small and micro enterprises, with large firms serving as strong catalytic nodes.

The Government must ease constraints on the growth of small enterprises and develop enterprise learning architectures which can help them to avail of shared services such as staffing, financing, quality management and so on. Innovative business solutions of small enterprises must be recognized and scaled up.

life-long learning New technologies and new industries are changing the shapes and sizes of enterprises. The formal education system must be supplemented by ‘just-in-time, needs-aligned’ learning modules which provide necessary skills on an on-going basis to workers, recommends the ‘Future of Jobs’ report. Dynamic training programs that can be offered in short time periods and meet the needs of an evolving production system are best offered by private enterprises.

Such learning formats require the larger participation of employers in systematic skill development and should be affordable and accessible for workers.

INITIATIVE

employment

SHIFTING THE BALANCE

(EMERGING SCENARIOS: NEXT 10-15 YEARS)

Life Long Learning

• Just in time

• Needs Aligned

(Humans as appreciating assets)

Enclaves

of Prosperity

Widespread

Growth

Growing

DissatisfactionDissatisfaction

*"Big is good/Small is

bad"

(And weak networks)

*"Small Enterprises are the

backbone"

(And strong networks)

Assembly lines for

education & skills(Humans as costs)

Employment ӿ ӿGrowth ӿ ӿ

Inequality ӿ ӿ(ӿ)

Social Unrest ӿ ӿ(ӿ)

Employment ӿ ӿ ӿGrowth ӿ ӿ ӿ

Inequality ӿSocial Unrest ӿ(ӿ)

Employment ӿGrowth ӿ

Inequality ӿ ӿ ӿSocial Unrest ӿ ӿ ӿ

Employment ӿ (ӿ)

Growth ӿInequality ӿ ӿ

Social Unrest ӿ ӿ ӿ

* The two ends of the axis represent contrasting 'theories-in-use' driving economic policies

DRIVERS OF JOBS ECOSYSTEM

Technology

as an enabler

Access to

Finance

Lifelong

Learning

Systems

*Talent and

Skills for

enterprises

Shapes and

Sizes of

Enterprises

Social

Security

Systems

*Patterns of

Employment

+Regulation

of Enterprises

*Poverty

Reduction* (In)equality

Innovation for

Inclusion

Policy and

Governance

Urban

Systems

*Outcomes of Systems

Design

+ Regulation of enterprises is an

intermediate driver controlled by the

driver POLICY AND GOVERNANCE

Rural

Systems


‘India must create good quality, stable jobs that drive productivity and provide learning opportunities for the workers. For this, a holistic thought process is needed that converges multiple

policy sets through a 'systems approach' to job creation. We believe that strong networks of small enterprises, life-long learning systems, universal social security, and effective technology platforms can be key enablers for creating new jobs and livelihoods on a massive scale.’

dr naushad forbes, President, CII, and Co-Chairman, Forbes Marshall

‘Government at all levels, including the Center, the States and district administrations, should be coordinated under the leadership of the Prime Minister’s office and the

Chief Ministers, with systematic methods for policy formulation and stakeholder participation to drive jobs growth. Job creation must be a principal metric in performance score-cards for governments at all levels to ensure adequate employment generation.’

chandrajit Banerjee, Director General, CII

social security Social insurance and innovative financing can help build a strong security net for workers. The current system of voluntary acceptance of social security measures such as pension and insurance can be made mandatory. It is estimated that about 0.34% of GDP will be required over a five-year period for coverage to unorganized sector workers, a large majority of the workforce. Instituting a comprehensive social security system will give enterprises the flexibility to remain competitive, expand, and create more jobs, observes the report.

technology, an enabler Technology and communications outreach can be effectively deployed to bring more workers into the system, as also increase their productivity. Technology can connect enterprises in strong networks, enable just-in-time, needs-aligned delivery of education and skilling, and drive access to finance. The report suggests that the policy agenda should target quick access to digital connectivity, effective regulations on security and privacy, and identification of emerging technologies where India can become a leader.

rural-urban Continuum Linking the urban and rural economies through the flows of natural produce can create a number of jobs. Regional planning through an empowered institutional system would accelerate this process. Strategic investments in infrastructure such as transport and housing would link workers with employment opportunities. The Atal

Mission for Rejuvenation and Urban Transformation (AMRUT) should be allocated more funds to develop smaller towns as economic hubs.

In rural areas, self-employment can be made more effective through aggregation in cooperatives, clusters, and provision of common services. Corporate engagement in key sectors such as food processing, transport and storage, is necessary to support rural transformation. Natural produce such as dairy, livestock, and non-timber forest produce, along with agriculture, needs strong policy focus.

The Future of Jobs report elaborates on three key sectors that have large potential for creating jobs in India in the next few years: tourism, healthcare, and natural infrastructure in the form of renewable energy, water and sanitation.

With strong focus on how to develop policies for job creation, the report calls for a ‘whole of Government’ approach to coordinate the design and implementation of policies. Systematic methods for multi-stakeholder policy formation such as ‘Regulatory Impact Analysis’ and ‘Capacity Works’ will speed up job creation outcomes, it says.

The 'systems approach' to job creation can deliver ‘Widespread Growth’, one of the possible scenarios developed in the report, which will accelerate wide-spread job creation, as well as boost GDP growth by 2-3%. In its absence, scenarios of ‘Enclaves of Prosperity,’ with increasing inequality, as well as ‘Growing Dissatisfaction’ could emerge, warns the report.

INITIATIVE


Prof Pradyumna Vyas, Director, National Institute of Design (NID), and Member Secretary, India Design Council, rued the fact that design is grossly under-utilized in the country. The potential size of the design industry in India is `11,681 crores and is expected reach `18,832 crores by 2020. of this, at present only a market worth `2100 crores is realized, meaning that more than 80% of the design potential is yet to be exploited, he said, The industrial design segment alone has the potential of `11,000 crores by 2020, he added.

The Summit featured the CII Design Excellence Awards, with the following winners:

• AURIC Aurangabad Industrial City: Designed by DMA yellow Works Pvt Ltd for the Aurangabad Industrial Township Ltd

• The State of Architecture: Practices and Processes in India: Designed by Kahani Designworks for Urban Design Research Institute

• Goodknight Personal Repellents

• Death Penalty India Report: Designed by Struckby

Building capacity

dr naushad forbes, President, Cii, and Co-Chairman, forbes Marshall, addressing the 16th india design summit in Mumbai

Cii design excellence award 2016 winners with dignitaries, at the india design summit in Mumbai

design 16th india design summit and Cii design excellence awards 2016Design is an integrating force, and a catalytic tool for sustainable competitive advantage for businesses and the nation. The Prime Minister’s vision of ‘Make in India’ has Design as the central theme. It is the 'x' factor for humanizing the massive public initiatives of the Government.

A new door of opportunity has opened in India for design interventions through Government initiatives such as ‘Make in India,’ ‘Digital India,’ ‘Clean India,’ and ‘Smart City.’

The 16th India Design Summit, held in Mumbai on 5-6 December, with the theme, ‘Design is the New Now,’ was a platform to create an enduring partnership between design and organizations, leading to innovation and increased economic competitiveness. Just as large and small gears work together in harmony, when designers work with organizations, they ignite innovation. The Summit explored new ideas, new initiatives, and new thinking needed to contribute to the larger picture of design in the knowledge economy.

We need to build an ecosystem of Design in the country. There is a strong need to increase investment in Research and Development, said Dr Naushad Forbes, President, CII, and Co-Chairman, Forbes Marshall.


BUILDING CAPACITy

for National Law University, Delhi

• 'SprintOn' stenter machine: Designed by Design Directions Pvt Ltd for Inspiron Engineering Pvt Ltd

• DAKSH bomb disposal robot system for army and paramilitary forces: Designed by onio Design Pvt Ltd for the Defence Research and Development organization (DRDo)

• Inito: Designed by Samplytics Technologies Pvt Ltd

• AMBIT - A Work-from-Home Ecosystem: Designed by Godrej Interio

• Godrej Ezee: Designed by Godrej Consumer Products Ltd Design Studio

• Hand-held Inventory Management Terminal: Designed by SFo Technologies Pvt Ltd-R&D Solutions for RGIS LLC

• Artist Aloud: designed by Fractal Ink Design Studio Pvt Ltd for Hungama Digital Media Ent Pvt Ltd

• Ira Chaudhuri Website: Designed by Itu Chaudhuri Design

• Buddy Ravan by Mayabious Art LLP

• CB HORNET 160R by Honda R&D (India) Pvt Ltd

• Tata Kite 5 by Tata Motors Ltd

• Jana Centre Operations System, with activity calendar, manual and ready reckoner: Designed by Cracker & Rush for Janalakshmi Financial Services

fast Moving Consumer Goods

People Management in fMCG sectorThe crucial factor in modern Fast Moving Consumer Goods (FMCG) innovation and creativity is people. Employees are an important resource for growth, and it is necessary to give them an eco-system that fosters creativity and innovation. An implemented reward system within an organization could offer incentives to motivate employees, generating a positive attitude that would encourage creativity.

The CII National FMCG Committee organized a National Mission on ‘People Management in FMCG sector' on 19-20 December in Bengaluru, as a part of its continuous learning and capacity-building initiatives. The objective of the mission was to identify the various opportunities for people management that could, in turn, nurture the growth of HR excellence in an organization. Recruitment and selection processes, as well


innovationCii industrial innovation awards 2016CII recognized 10 promising start-ups with the CII Industrial Innovation Awards 2016, presented during the India Design Summit on 5-6 December in Mumbai. This year, the start-up category received 100+ entries from

intellectual Property rights

iPr for academiaCII, in association with the Intellectual Property office, Department of Industrial Policy & Promotion, Ministry of Commerce & Industry, organized an awareness seminar on ‘Intellectual Property Rights for Academia’ for students and professors from four engineering colleges, on 9 December in Vijayawada. The main objective of the seminar was to inculcate the IPR ecosystem, from innovation to IPR filings and protection, among the students.

international tM Protection systemsCII, in association with the European Union Intellectual Property office (EUIPo), and the IPo, organized a

Presentation of the Grand award for Most Promising start-up to Multiversal technologies, during the design summit in Mumbai seminar on ‘international tM Protection systems’ in Chandigarh

various sectors across the country, of which 59 were shortlisted in the initial phase. From these, Multiversal Technologies won the Grand Award (Most Promising Start-up) for creating a set of products which save water use in urinals, save power, save chemical usage, prevent odors and provide hygiene, the only start-up providing such end to end solutions.

The award for 'Best Manufacturing Start-up' was jointly awarded to Creintors Teknosol Pvt Ltd for developing a machine which makes tool management easy, reduces tool search time and ensures easy tool accessibility in manufacturing units, and Embryyo Technologies Pvt Ltd, for developing a strong portfolio of medical devices.

The 'Best Services Start-up' award went to iTeach Fellowship (an initiative of iTeam Advisors Echelon Pvt Ltd) with high social impact, which develops teachers of low income schools.

as processes to retain employees, the performance management system, initiatives to create a successful ecosystem, and the culture, policy and procedures for people management, were the prime outlook of the mission.

The companies visited were ITC Ltd, Britannia Industries Ltd, Hindustan Coca Cola Beverages, and Landmark Group. These companies are potentially skilled in handling robust employee functions starting from unskilled labor to top management. The companies shared their innovative HR initiatives, and practices for talent acquisition and retention, fun at work, appraisals, etc.

national Mission on People Management in fMCG sector in Bengaluru

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seminar on ‘International TM Protection Systems’ on 13 December in Chandigarh, to share global best practices and strategies for brand protection for SMEs.

The seminar, 5th in the series, discussed specialized topics, such as brand dilution, goodwill, pre and post registration steps and enforcement strategies, which can be adopted for trademarks. It also deliberated on the filing of the Madrid International Applications at the Trade Mark Registry, and the benefits of using this system for Indian applicants, when seeking trade mark registration abroad.

specialized training on Geographical indicationSeminars on ‘ S p e c i a l i ze d Tr a i n i n g o n Geographical Indication (GI),’ w e r e h e l d on 13 and 19 December in Guwahati and New Delhi respectively, to enhance the capacity of Indian productive sectors to create, protect and manage IP; and to increase awareness among consumers on GI products and GI protection. The seminars, organized by CII in association with EUIPo and the IPo, included practical examples and exercises.

specialized training on industrial designSeminars on ‘Specialized Training on Industrial Design’ were held on 14 and 20 December in Guwahati and New Delhi, respectively, to exchange best practices and cooperation in the field of IP. They also increased awareness on Industrial Designs, registration procedure, fees, protection granted, etc, with a view to enhance a broader IP intensive ecosystem in India.

The seminars were organized by CII in association with the EUIPo and the IPo.

seminar on specialized training on Geographical indication (Gi) in new delhi

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seminar on ‘specialized training on industrial designs’ in new delhi


understand the impact of MNCs R&D units on the Indian Science, Technology and Innovation (STI) ecosystem. The objective is to capture the positive levers for MNC R&D activity in India and how to promote them, and also examine the scope for improvements in the system. The study and the subsequent results will be used to suggest policy reforms to the Government of India, recommend reforms, and tailor the implementation strategies to attract more MNCs to set up R&D units in India. It would also help benchmark our R&D ecosystem with reference to China.

CII organized four interactive roundtables in four different cities: Bengaluru, Pune, Ahmedabad and Hyderabad, to interact with R&D heads to understand their requirements and get their views on the R&D culture in their organizations. Inputs and data from the MNCs on their R&D operations in India was collated through a survey questionnaire.

More than 50 MNCs, including Intel, Dell, GE, Volvo, Dow Chemicals, Boston Scientific, Voith Industries, ThyssenKrupp, Bosch Rexroth, and Hyundai, among others, participated in the roundtables.

technology Partnerships Conference on automotive electronics The Tamil Nadu Technology Development & Promotion Center (TNTDPC) of CII organized the 2nd edition of the ‘Conference on Automotive Electronics’ on 9 December in Chennai, with the theme ‘Exploring Advances in Automotive Electronics.’ The conference engaged stakeholders from the automotive, electronics, industrial and IT sectors to discuss and understand the current and future trends in ICT for auto-electronics. The conference was chaired by Mr Amit Jain, Country Head, Electronics Group, India, Visteon.

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at the Conference on automotive electronics, in Chennai

Knowledge Management

national Mission on Knowledge ManagementToday, organizations around the world are increasingly seeing Knowledge Management (KM) as a key enabler in providing strategic benefit, by reducing the time, cost and risk involved in delivering projects. Executive commitment, organizational culture, management style, access to new and enabling technologies and IT infrastructure are critical factors influencing the success of KM practices.

The CII National Committee on Knowledge Management and Business Transformation organized a 30-member National Mission on Knowledge Management in Bengaluru on 15-16 December, to enable the delegates to gain insights on KM best practices adopted by various organizations, understand the initiatives in creating a successful ecosystem, create a culture for knowledge, transform knowledge to add value to the processes, leverage knowledge strategic to business to accelerate innovation, and use knowledge to provide a competitive advantage for the business.

The power-packed mission visited four leading players from different sectors – Infosys, Robert Bosch Engineering & Business Solutions Pvt Ltd, Capgemini, and Flipkart.

national Mission on Knowledge Management in Bengaluru

technology impact of MnC r&d activity CII, in partnership with the Department of Science and Technology, is working on analyzing the impact of MNC R&D units in India.

As part of this initiative, CII is conducting a study to


Societal interface

• G Munniyammal, who used to struggle to make ends meet, now trains over 2000 marginalized women in producing handicrafts from leftover banana fiber, enabling financial independence for women in and around Vellore.

• Battling her own illiteracy, Nayka Chandaben is connecting thousands of unschooled children from the remote forested Panchamahal area of Gujarat to the formal education system, through study camps.

• Dipali Pramanik, a diffident tailoring program trainee, has transformed herself into a successful entrepreneur providing sustenance and support to marginalized women, and plans to cater to both domestic and foreign markets.

• Shahana KT is building first generation women IT entrepreneurs and professionals from remote and conservative communities of Kerala.

Many such torch bearers have been recognized and celebrated since the inception of the CII Foundation Woman Exemplar Program in 2005. The program identifies and recognizes grassroot women leaders working in the fields of Health, Education and Micro-enterprise, and empowers them to further upscale their initiatives. Each year, one woman exemplar from each of these three categories is recognized, from amongst hundreds of nominations received from across the country. The exemplars are selected through a rigorous selection process undertaken by a team of social

Woman exemplar Program

Building the capacities of grassroot women leadersscientists and experts, with the final selection made by a panel of eminent members from industry and the social sector, who look for self-motivated individuals from extremely challenging backgrounds, and exhibiting strong leadership.

In the last two months, 25 members from the CII Foundation Woman Exemplar Network from 8 States have undergone a unique Capacity-building Program organized by the CII Foundation in three cities – Kolkata, Chennai and Pune. The objective of the workshops was to enhance the leadership quotient of the participants and enable them to become more effective managers of their initiatives. The Exemplars were joined by sector experts, who would also continue to mentor them over the next 6 months.

During the sessions, the participants reflected on their leadership styles, identified areas of improvement, audited their strengths and weaknesses, recognized threats and opportunities, learnt the application of innovative ideas and strategies while keeping in mind challenges and risks faced on the ground, realized the importance of building collaborations with various stakeholders both within and external to their eco systems, and translated their vision into a year-long action plan. The platform spurred dynamic learning and exchange among the exemplars and initiated a peer-learning network of grassroot women leaders at the regional level, along with the domain experts.

glimpses from the capacity-building Workshops


Portfolio for excellence

Water Management

learnings from israel The CII-Triveni Water Institute, CII’s Center of Excellence on Water, and the Water Research Center, Tel Aviv University, Israel, entered into Memorandum of Understanding (MoU) to enhance cooperation in planning, designing, and implementing new and innovative tools and technologies to improve the management of water in India. The MoU was signed by Mr Chandrajit Banerjee, Director General, CII, and Prof Joseph Klafter, President, Tel Aviv University, at the 9th India Israel Forum session on ‘A bilateral water agenda: Using Policy & Technology to ensure Water Security’ on 22 December in Mumbai.

The MoU identifies opportunities and geographical areas where both organizations will pool expertise and derive workable, scalable solutions in the water sector in India, for the benefit of the community at large. This includes technology, management, policy reforms and advanced tools and techniques. It covers various sectors, such as irrigation, industry, domestic water use, wastewater management, municipal sewage recycling, improving water use efficiency, training and capacity-building, and most importantly, implementing strategies in drought-prone areas of India.

The learnings from Israel, customized and applied to the water sector in India, will further strengthen the bilateral ties between the two countries. Political will and scientific considerations will lead to successful applications. In situ treatment technologies will also have a key role to play on a decentralized basis, said Prof Klafter.

Mr Nikhil Sawhney, Member, Advisory Board, CII-Triveni Water Institute, and MD, Triveni Turbine Ltd, and Director, Triveni Engineering and Industries Ltd, said the MoU would facilitate the adoption and application in India of models of public private partnerships, awareness generation, policy and pricing reforms that

had helped convert a desert country like Israel into a water-surplus nation.

A combination of intelligent policy, advanced technology, and stakeholder participation will certainly bring about the much-desired change in India’s water sector, said Mr Chandrajit Banerjee, Director General, CII, adding that the MoU would open doors to new state-of-the-art techniques and technologies that could be customized and implemented. CII’s WATSCAN water scanning tool is helping improve water management strategies in the country, he said.

The workshop, with water technology experts, Government representatives, academia, and industry leaders from both India and Israel, called for an integrated approach to ensure water security by improving water use efficiency. It shared learnings from Israel with new paradigms of water governance.

Chandrajit Banerjee, director General, Cii, and Prof Joseph Klafter, President, tel aviv university, exchanging the Mou during the 9th india israel forum session on ‘a bilateral water agenda' in Mumbai. also seen: amar sinha, secretary (er), Mea; aharon fogel, Chairman, ZiM integrated shipping services ltd, and Jamshyd Godrej, Past President,

Cii, and Chairman, Godrej and Boyce Mfg Co ltd

daniel Carmon, ambassador of israeli to india; nikhil sawhney, Member, advisory Board, Cii-triveni Water institute, and Md, triveni turbine ltd, and director, triveni

engineering and industries ltd, and hugo Chaufan, Chairman of the Board, arad Group, and Chairman, Board, Metzerplas, and

Chairman, investment Committee, Migdal insurance


sMe Competitiveness Cluster approach to support ‘Make in india’ Building the competitiveness of Micro, Small and Medium Enterprises (MSMEs) would be a great boost to the ‘Make in India’ movement, said Mr S N Tripathi, Additional Secretary and Development Commissioner, Ministry of MSME, inaugurating the 9th CII National Competitiveness and Cluster Summit on 1-2 December in New Delhi. The annual flagship event of the CII Avantha Centre for Competitiveness for SMEs, organized with support from the Ministry of MSME, and other affiliated bodies, is held to give new direction to the cluster movement, and enable networking amongst Indian SMEs and their ecosystem. This year’s Summit, with the theme of ‘Building Manufacturing Competitiveness for Make in India,’ was attended by over 600 delegates, including government officials, delegates from overseas, and industry stalwarts from small and large enterprises.

Mr S N Tripathi urged original Equipment Manufacturers (oEMs) to form vendor clusters to meet common goals. While appreciating German engineering, he also commended Indian frugal engineering, commonly known as ‘jugaad.’ Urging MSMEs to join the digital movement, he highlighted the gains of the MUDRA scheme, and the ZED (Zero Effect, Zero Defect) scheme, under which the Ministry proposes to grant certification to one million units.

D r M a r t i n N ey, A m b a s s a d o r o f Germany to India, said his country, like India, has a strong MSME culture, with 99% of German companies being SMEs, and mostly family-owned. Appreciating Germany’s l o n g - s t a n d i n g partnership with CII, he said the successful Indo-German Manager Training Program has

trained over 500 Indian managers. Germany will continue to support in skilling India, he said.

With sessions on world class manufacturing, smart factory logistics and emerging trends in defence and aerospace, the Summit showcased the success of the Cluster approach of the CII-Avantha Centre of Competitiveness for SMEs, which emphasizes on 3Ps: Purpose, Process and People, and 5Rs: Reassess, Review using quality tools, Rethink, Relearn, and Reform, for business success. Industry members urged the Ministry to simplify the procedures of its schemes, and suggested that the Centre offer counseling on crisis management for SMEs.

The Summit hosted the prestigious CII awards, live presentations of the best case studies, and the Kaizen Gallery. More than 450 case studies and 1500 kaizen entries came in from all over the country.

Plant visits were organized to Hero Motocorp Ltd, Sandhar Automotives Ltd, Sona Koya Steering Systems Ltd, and JBM Industries Ltd, in Gurgaon and Dharuhera, to expose the delegates to industry best practices.

indo-German Manager training ProgramThe Indo-German Manager Training Program (IGMTP), an on-going bilateral initiative to enhance the international

iGMtP participants in Gurugram

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dr Martin ney, ambassador of Germany to india; yogesh Munjal, Chairman, Cii Cluster for Competitiveness, and Md, Munjal showa ltd; s sandilya, Chairman, eicher Group; shreekant somany,

Chairman, Cii national sMe Council, and CMd, somany Ceramics ltd; surendra nath tripathi, additional secretary & development Commissioner (MsMe), Ministry of MsMe, and Jayant davar,

Co-Chairman, Cii national Manufacturing Council, and Co-Chairman & Md, sandhar technologies ltd, at the 9th Cii national Competitiveness and Cluster summit, in Chandigarh


business and economic potential of Indian enterprises by bringing Indian executives and managers in contact with German enterprises, has shown outstanding results.

The Indian leg of the current batch of the program was held on 12-15 December in Gurugram.

Inaugurating the program, Dr S S Gupta, officer, Department of Industrial Policy & Promotion (DIPP), Ministry of Commerce and Industry, urged the participating SME owners to focus not only on exports/imports but also on technology transfer and bilateral investments, during their study and business tour to Germany. The DIPP is constantly working towards facilitating ‘Make in India.’ The IGMPT is one such program that can accelerate the competitiveness of Indian companies and put them on the global map, he said.

The Indian leg of the training inducts the participants into topics like macro and micro economic factors, foreign trade, cross-cultural communications, international economic relations, HR management, etc.

electrotech 2016The CII-Avantha Centre of Excellence for Competitiveness for SMEs organized a two-day technical conference on pollution, energy-efficiency and technology in Electroplating, ElectroTech 2016, on 15-16 December in Chandigarh. ‘Making Electroplating Industry Zero Defect, Zero Effect’ was the theme of the conference. Some of the key suggestions emanating from the discussions include:

• As a majority of electroplating units are micro and small scale, they need technical exposure to the best environmental practices, technologies and waste-minimizing strategies.

• A constant drive towards a cleaner environment is needed, with funds provided by the environmental governing bodies.

• It is necessary to install equipment in the Chandigarh region to check the thickness of different coatings by non-destructive methods, to help local enterprises understand the electroplating process and implement new techniques.

• There is good scope for energy efficiency in electroplating plants, as a lot of energy is consumed in the heating process of solutions.

• Need for installation of effluent treatment plants in the tri-city for adequate treatment of wastewater generated by industrial electroplating, prior to the discharge of the wastewater.

Corrosion Management The CII-Avantha C e n t r e f o r Competitiveness for SMEs has completed a decade of initiatives to create awareness in Indian industry about corrosion and its adverse effects on the country’s development. The Centre conducts corrosion audits in plants, brings out posters and publications, and holds regular seminars and training programs, including in-house training, to control and eliminate the impact of corrosion on safety, economy and environment.

CII has formed a national Corrosion Management Committee (CMC), under the chairmanship of Dr Baldev Raj, Distinguished Scientist, and Former Director, Indira Gandhi Centre for Atomic Research (IGCAR), and Director, National Institute of Advance Studies, Bengaluru, and the Faraday Corrosion Council (FCC), chaired by Dr U Kamachi Mudali, Associate Director – Corrosion, Science and Technology Group, IGCAR, Kalpakkam, to direct these efforts.

The 12th CII-CMC/FCC Meeting in Chandigarh on 16 December explored ways to reduce the huge loss to India’s GDP due to corrosion.

hr excellence Mission A 2-day HR Excellence Mission to Kirloskar Pneumatic Company Ltd, Forbes Marshall Ltd, Thermax Ltd, and Sulzer India Private Ltd, all in Pune, on 21-22 December, enabled the participants interact with the senior management of these benchmark companies, well-known for excellence in their HR practices.

Cii-CMC/fCC Meeting in Chandigarh

Members of the hr excellence Mission in Pune

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leadership the leadership debate 2016The CII Suresh Neotia Centre of Excellence for Leadership (CII SNCEL) organized the first edition of ‘The Leadership Debate’ on 20 December in Kolkata. The motion for the debate, ‘Disruptive Leadership is only a Myth,’ was underpinned by disruptive developments across continents in all spheres, economic, political, social, business and industry.

Eight prolific speakers from business, academics and politics engaged in the intellectually stimulating debate.

The esteemed speakers for the motion included Prof Dr Sugato Bose, Member of Parliament, Prof Anuradha Lohia, Vice Chancellor, Presidency University, Mr Jawhar Sircar, Former CEo, Prasar Bharti, and Mr P R Ramesh, Chairman, Deloitte India Ltd. Mr Baijayant ‘Jay’ Panda, Member of Parliament, Rear Admiral AK Verma, VSM, IN (Retd), CMD,Garden Reach Shipbuilders & Engineers Ltd, Mr Roopen Roy, Founder, Sumantrana, and Mr Joydeep Mukherji, Group CFo & VP, operations & HR, iMerit, spoke against the motion.

Mr Harshavardhan Neotia, Chairman CII SNCEL, and Chairman, Ambuja Neotia Group, presided over the event, which was moderated by Mr Pradeep Gooptu, Trustee, Calcutta Debating Circle. Dr Rupali Basu, Vice-Chairperson, CII West Bengal, and CEo, Apollo Hospitals

Group, introduced the speakers.

Arguing for the motion, Dr Sugato Bose said that ‘disruptive leadership’ was a term coined by management gurus who felt that complacency needed to be stirred up, and therefore leaders needed to be disruptive. Prof Lohia opined that success comes from small incremental changes and not any big bang disruptions, citing the example of evolution and Darwinism. Mr PR Ramesh felt the term disruptive leadership is itself an oxymoron as leaders are always inspirational, never disruptive. Mr Jawhwar Sircar, agreeing to the motion, said the art of retaining leadership cannot be disruptive. Disruption is only a strategy to enter the system, while leadership is a strategy for continuing, he said.

Disruptive leadership is not negative, said Mr BJ Panda, speaking against the motion. The essence of a disruptive leader is to take the same set of resources, circumstances and limitations, and see it differently, he said.

Adding a military perspective to the debate, Admiral Verma observed that no one won a war with set rules. Change only happens when there is disruption, which is the only way to move forward, he added. Mr Roopen Roy agreed that progress can be achieved only through disruptive innovation. Supporting his team, Mr Joydeep Mukherjee said that disruptive leadership is about challenging the status quo. In today’s fast, digital world, there is little room for incremental changes, he pointed out.

Both sides debated with great aplomb, constructively engaging the audience.

Jawhar sircar, former Ceo, Prasar Bharti; P r ramesh, Chairman, deloitte india ltd; Prof anuradha lohia, Vice Chancellor, Presidency university; Prof dr sugato Bose, Member of Parliament; Pradeep Gooptu, trustee, Calcutta debating Circle; dr rupali Basu, Vice-Chairperson, Cii West Bengal, and Ceo (er), apollo hospitals Group; harshavardhan neotia, Chairman, Cii snCel, and Chairman, ambuja neotia Group; indrani Kar, head, Cii snCel; Baijayant ‘Jay’ Panda, Member of Parliament; rear admiral aK Verma, VsM, in (retd), CMd, Garden reach

shipbuilders & engineers ltd; Joydeep Mukherji, Group Cfo, and VP operations & hr, iMerit, and roopen roy, founder, sumantrana


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food and agriculture

food safety, Quality and regulatory XchangeThe Indian food industry, a high-growth and high-profit food industry with immense potential for value addition, is expected to reach $78 billion by 2018. The contribution of the food processing sector to the Gross Value Addition (GVA) in 2014-15 amounts to `1.43 trillion at 2011-12 prices. In 2014-15, GVA in food processing grew by 5.78%. The food processing industry is also employment-intensive. It is interesting to note that the online food ordering business in India, despite being in a nascent stage, is also witnessing exponential growth. With online food delivery players building scale through partnerships, the organized food business has a huge potential and a promising future.

Simultaneously, the country is witnessing a positive shift in the food regulatory ecosystem. The Food Safety and Standards Authority of India (FSSAI) is, through a series of notifications and regulations on proprietary foods, food additives and imports, among other aspects, laying the foundation of a robust science-based food regulatory regime, encouraging compliance, and building investor confidence. FSSAI’s recent initiatives in the standards on food fortification of staples will play a catalytic role in addressing the problem of malnutrition. The Authority has also undertaken the harmonization of Indian standards with international benchmarks, besides working with different wings of the Government to streamline inter-ministerial coordination.

Changing demands for variety, greater purchasing power of consumers, and globalization of food supply chains, where companies are sourcing from suppliers around the world, have created a great opportunity for the Indian food sector to become the supplier and food factory of the world. It is thus imperative to improve food safety systems and practices across the entire ecosystem, from farm to fork.

In the current global scenario, where scientific advances are increasing our ability to detect hazards and identify risks, new technologies, such as on-farm GPS mapping and DNA labeling and traceability, combined with social media, are giving consumers unprecedented transparency about not only the food they purchase

‘An investment of `500 crores is being made for upgrading laboratory infrastructure in the country. The practices prevalent in other countries are being benchmarked by India to create a uniform regulatory environment, which is a key to food safety.’

pawan Kumar agarwal, CEo, Food Safety Standards

Authority of India

‘Effective monitoring of food safety across the entire value chain is necessary to combat food-borne diseases. Engagement of all stakeholders is the key to achieve the objective of ‘Safe Food for All.’

awilo ochieng pernet, Chairperson, Codex

Alimentarius Commission

‘Food security, safety and nutritional security should be aligned to each other. The three pillars for a safe food value chain are education of consumers, accessibility to safe and nutritious food, and practical legislations having a risk-based approach.’

geetu verma, Chairperson, CII Task Force on

Food Regulatory Affairs, and Executive Director – Foods,

Hindustan Unilever Ltd

v o i c e s

Pawan Kumar agarwal, Ceo, food safety standards authority of india; Piruz Khambatta, Co-Chairman, Cii national Committee on food Processing industries, and CMd, rasna international; Geetu Verma, Chairperson, Cii task force on food regulatory affairs, and executive director – foods, hindustan unilever ltd; awilo ochieng Pernet, Chairperson, Codex alimentarius Commission; sanjay dave, Chairman, steering Committee, surakshit Khadya abhiyan, and former Chairman, Codex alimentarius Commission, and ravi Mathur, Chairman,

Cii expert Group on food safety & Quality, and Ceo, Gs1, at the 11th Cii food safety and Quality summit in new delhi


but also on the origins and ingredients of their food, making food safety a top priority for food producers.

The CII-Jubiliant Bhartia Food & Agriculture Centre of Excellence (FACE), as a part of its national initiative, the Surakshit Khadya Abhiyan, organized the 11th CII Food Safety and Quality Summit on 6-7 December in New Delhi on ‘Food Safety, Quality and Regulatory xchange.’

There were deliberations on emerging food safety risks and their mitigation, methods of strengthening farm practices, international food safety regulatory regimes, and the science behind claims validation and substantiation. Day 2 of the Summit featured two master classes on

• Best practices in food safety and quality from farm to fork

• Science-based sampling for determination of food safety risk elements.

Key Recommendations

• Management of primary production towards reducing chemical residues in fresh and processed foods to acceptable levels

• Transitioning from a ‘hazard-based’ to a ‘risk-based’ approach for food safety risk mitigation

• Strengthening food safety analysis and testing infrastructure, including a review of national and international standards on sampling and capability-building

• Ensuring shared responsibility of the industry and the regulator, and effective communication with consumers

• Developing an action plan for responsible use of anti-microbial resistance organisms in agriculture, aquaculture and the environment, including awareness-building, implementation of practices, and providing evidence.

7th cii food safety awards

Food Business operators we r e r e c o g n i ze d fo r Excellence in Food Safety Practices at a special event during the Summit.

Mr Ash ish Bahuguna , Chairperson, FSSAI, was joined by Ms Awilo ochieng Pernet, Chairperson, Codex

Alimentarius Commission, and Ms Anuradha Prasad, Joint Secretary, Ministry of Food Processing Industries, to give away the Awards at the 7th CII Food Safety Awards Ceremony.

Five sectors, covering 6 food businesses in the categories of food ingredients, restaurants, warehouses, beverages, and ready-to-cook, out of the participating 15 sectors, qualified for the awards for ‘outstanding Performance in Food Safety.’ Five of the six award-winners were small and medium businesses.

The FSSAI awarded cheques of `5000 to each winner in the Street Food Category as an incentive for embracing the principles of food safety and quality in their day-to-day work.

This year, 73% of the applicants were from the Small and Medium food sectors, including street food vendors, and more than 112 qualified assessors were involved in the assessments.

representatives of adani agrilogistics ltd, Moga, receiving the award for food safety 2016 from ashish Bahuguna, Chairperson, food safety standards authority of india, and anuradha Prasad,

Joint secretary, Ministry of food Processing industries

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Adani Agrilogistics Ltd, Moga Criteria 4 SMB (M) Storage, handling and

transportation of grain Warehouse

ADM Agro Industries, Latur

Criteria 3 SMB (M) (RS) Soya lecithin Food

Ingredients

Domino’s Pizza, KK Nagar

Criteria 2SMB (S) (RS)

Pizza, side items, desserts and beverages QSR

Hector Beverages Pvt Ltd, Mysore Criteria 3 SMB (M)

Manufacturing, storage, sale and distribution of ready-to-serve beverages

Beverages

Varun Beverages Ltd, Nuh Criteria 3 Large Carbonated soft drinks Beverages

Jubilant Foodworks Ltd, Mohali Criteria 3 SMB (M)

Manufacturing of dough, storage of raw material and packaging material for dispatch to retail outlets

RTC

award winners


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the ‘Resource-efficient and cleaner production’ pilot project to foster eco-industrial parks in India.

The project activities include generating awareness, capacity-building, infrastructure needs assessment at the park level, exploration of industrial synergies, and other studies.

As part of the project, a launch workshop was organized on 15 December in Vizag. Dr P P Lal Krishna, CEo, Ramky Pharma City (India) Ltd, said the target industries in the JNPC are expected to benefit from operational costs savings, due to lower consumption of materials, energy and water, and reduced disposal of waste, emissions and waste water, among other benefits.

delegation from Chattisgarhon 16 December, a delegation of elected representatives from the State of Chattisgarh visited CII Godrej GBC. The visit was organized by the Engineering Staff College of India, as part of a 3 day capacity-building program. The delegates were given a green building tour and a briefing on the activities and initiatives of the Centre.

Green Business GreenCo rating system for the it sectorThe CII-Godrej Green Business Centre (GBC) launched the GreenCo Rating System for the IT sector on 20 December in Bengaluru. This robust evaluation process would rate the degree of environmental performance of a company and evaluate it on various green parameters, while suggesting the way forward. The GreenCo rating system for SMEs, and for the sugar sector, was launched earlier.

As on December 2016, over 250 companies in India are working on the GreenCo rating system, and 30 GreenCo-rated companies have reported savings of about `595 million / year.

Training Programs on Green Buildings were held on 8-9 December, New Delhi, and on 22-23 December in Hyderabad

eco-industrial ParksThe CII-Godrej GBC, in association with the Jawaharlal Nehru Pharma City (JNPC), Vizag, has initiated a project on transforming the JNPC into an eco-industrial park. The United Nations Industrial Development organization (UNIDo) has asked the CII – Godrej GBC to facilitate delegates from Chattisgarh at the GBC in hyderabad

Manufacturing excellence

Business Case for safety The CII Naoroji Godrej Centre of Manufacturing Excellence hosted a conference on ‘Business Case for Safety’ in Mumbai on 21 December, to highlight the importance of safety as a strategic imperative for organizations, necessitating an attitudinal change in the minds of all involved.

A CII report on the topic released at the conference called for safety to be pursued as a strategy by all organizations for overall business excellence and employee engagement, creating

V B sant, director General, national safety Council; Jamshyd n Godrej, Past President, Cii, and CMd,

Godrej & Boyce Mfg Co ltd, and Chandrajit Banerjee, director General, Cii, releasing the Cii report on

‘Business Case for safety’ in Mumbai

a business case for safety on humanitarian, legal and economic grounds.

The CII-NSC Safety Rating System was launched on the occasion by Mr Jamshyd N Godrej, Past President, CII, and CMD, Godrej & Boyce Manufacturing Co Ltd. This Rating System to evaluate the SHE (Safety, Health and Environment) status of participating member companies, also aims to ignite within them the passion to improve

their SHE performance.

Mr Jamshyd Godrej spoke about the need for workers to internally institutionalize the importance of safety, towards building a robust culture of safety in organizations.

Safety has been a crucial area of intervention for CII for decades, said Mr Chandrajit Banerjee, Director General, CII, inviting member companies to share their best practices to benefit others.


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Quality16th tPM national ConferenceThe TPM (Total P r o d u c t i v e M a i n t e n a n c e ) C lub of Ind ia , CII Institute of Quality, organized the 16th National Conference on 7-8 De c e mb er i n B e n g a l u ru , with the theme, ‘Leveraging TPM for World Class Manufacturing.’

Mr Ashok Rao, Convenor, CII Karnataka Manufacturing Panel, and MD, KGK Engineering Pvt Ltd, in his opening remarks, spoke about 12 potentially economically disruptive technologies which would be the centerpieces of future transformational change. Manufacturing conditions were improving with greater workforce safety, better working conditions, increased collaboration opportunities, more data availability and enhanced resource utilization, he said.

Mr Kamal Bali, MD, Volvo Group – India, who was the Chief Guest, said the nation’s three top challenges are job creation (and entrepreneurship), education, skills and human development, and infrastructure development (physical and digital). TPM methodologies and practices are excellent integrators to derive manufacturing excellence, he said.

TPM has been ably adopted by the Indian manufacturing industry in its quest to become globally competitive, said Mr R Mukundan, Chairman, CII Institute of Quality, and MD, Tata Chemicals Ltd. Information exchange, in-house counseling, training and handholding implementation, seminars and workshops, plant visits to TPM-practicing companies, kaizen conferences, circle competitions and conferences have been instrumental in promoting manufacturing excellence and competitiveness in Indian manufacturing companies, he said.

Senior leaders from industry shared their experiences of TPM applications in their organizations.

lean –the toyota Way CII IQ organized training on Lean–The Toyota Way, coupled with visits to Lean practicing companies on 1-2 December in Pune. Nineteen delegates from both manufacturing and services companies visited Vishay Component India Pvt Ltd, and SKF India Pvt Ltd, to learn various concepts of Lean Manufacturing and observe its practical applicability.

16th tpm national conference Winners

Certificate of Significant Achievement for TPM

• Hindustan Coca Cola Beverages Pvt Ltd, Hospet

• Madras Radiators & Pressings Ltd (under TAFE Cluster)

• Caparo Engineering India Pvt Ltd (under TAFE Cluster)

• Nelcast Ltd (under TAFE Cluster)

• Amalgamations Repco Ltd (under TAFE Cluster)

• Napino Auto & Electronics Ltd

• Ashok Iron Works

certificate of strong commitment for tpm

• Neel Industries Pvt Ltd (under TAFE Cluster)

• Surin Automotive Pvt Ltd (under TAFE Cluster)

• Federal Mogul Goetze India Ltd

• Godrej & Boyce Mfg. Co. Ltd, Lawkim Motors Group

• Mahindra Intertrade Ltd

• Greaves Cotton Ltd, Plant I & V

champions trophy competition

Winning teams from the Kaizen Competition and the Circle Competition took part in the Champions Trophy Competition on 6 December in Bengaluru. The winners were

Winner: Raychem RPG (P) Ltd – Kobetsu Kaizen

1st Runner up: Bajaj Auto Ltd, Motorcycle Division, Aurangabad- Jishu Hozen

2nd Runner up: Brakes India Ltd - Jishu Hozen

ashok rao, Convenor, Cii Karnataka Manufacturing Panel, and Md, KGK engineering Pvt ltd; Kamal Bali, Md,

Volvo Group – india, and r Mukundan, Chairman, Cii institute of Quality,

and Md, tata Chemicals ltd, at the 16th tPM national Conference in Bengaluru

delegates at sKf india Pvt ltd, in Pune


Business excellenceThe CII Institute of Quality’s Business Excellence vertical regularly organizes various programs for capability-building across different organizational processes and functions in the areas of HR, coaching and mentoring, in addition to its flagship training programs.

A three-day Business Excellence Assessor Training was conducted concurrently in Bengaluru, and for the BHEL unit in Bhopal, on 7-9 December. A sensitization program on Business Excellence was conducted for ABB in Bengaluru, who are new entrants into the Business Excellence fraternity.

During 2016, the vertical trained over 200 assessors who were empaneled and engaged in external assessments. As a precursor to the maiden Customer obsession Award, assessor trainings and a series of webinars were organized in Bengaluru to give the participants a clear insight into the assessment model and framework.

At a focused workshop on ‘How to benefit from Business Coaching & Mentoring’ on 12 December in Bengaluru, entrepreneurs, CEos and business heads explored the conceptual differences between ‘coaching’ and ‘mentoring’ and their application to business. The unique aspect of the workshop was the presence of five former CEos who shared their experiences.

An intensive workshop for the HR fraternity on HR Metrics and Analytics in Hyderabad on 12-13 December dealt in detail with HR processes, audits and associated metrics.

study Mission to toyota Kirloskar

The CII Institute of Quality organized a Study Mission to Toyota Kirloskar Motor Pvt Ltd, Bengaluru, on 6 December, to showcase good manufacturing practices ‘The Toyota Way.’ This study mission was designed to provide the 10 participants from the aerospace, petrochemicals, manufacturing and FMCG sectors first-hand insights and experiences on Toyota Kirloskar gurukul practices, with a gemba visit and case study presentations.

Cii trains budding Civil servantsThe Lal Bahadur Shastri National Academy of Administration, Mussoorie (LBSNAA) invited the CII Institute of Quality to address 377 probationary officers attending the 91st foundation training program at the Academy on Total Quality Management, especially as it applies in governance and public services. LBSNAA is the country’s premier civil services training academy.

Mission members at toyota Kirloskar Motor Pvt ltd in Bengaluru

For further details on programs of the CII Institute of Quality, please contact: • Lean & Six Sigma: [email protected] • Business Excellence: [email protected] • TPM: [email protected] • QMS & Lab: [email protected], [email protected]

PoRTFoLIo


Engaging with the Worldaustralia

australia india leadership dialogue“Today, the uniting factor between India and Australia is the economic linkages that both countries have developed with each other. We are slowly moving to be partners in each other’s progress,” said Ms Shobana Kamineni, President Designate, CII, and Execut ive Vice Chairperson, Apollo Hospitals Enterprise Ltd, at the 2nd edition of the Australia India Leadership Dialogue, in Melbourne, Australia.

The Australia India Institute, in partnership with CII, hosted the second Australia India Leadership Dialogue on 4-6 December in Melbourne. The annual event, held alternately in India and in Melbourne, brings together leading figures from business, public life, civil society and the media in the two countries. The discussions cover a range of themes of fundamental importance to Australia and India, including governance and geopolitics, economics and business, and education and social change.

The Dialogue this year featured sessions on domestic political updates, global trade policy developments, how to increase mutual trade and investment and business cooperation, and developing the security architecture in the region.

In an exclusive session, the Hon Malcolm Turnbull, Prime Minister of Australia, highlighted the importance of the bilateral relationship. Ms Kamineni suggested food processing, vocational education, services, and energy and environment, as critical areas for bilateral cooperation leading to mutual benefit. “To take full advantage of the cooperative political relationship and business opportunities available in the two countries,

we need to increase and enhance our understanding of local conditions, encompassing all aspects that impact investments and business activities,” she said.

The Dialogue was also attended by Mr yanamala Ramakrishnudu, Minister of Finance, Andhra Pradesh, and Mr Imran Ansari, Minister of Information Technology, youth Services, Sports and Technical Education, and Mr Sajad Lone, Minister for Social Welfare, Science & Technology, both from Jammu & Kashmir.

eGyPt

understanding tax lawsThe CII India Business Forum, Egypt, invited Mr Abdel Moniem Matar, Chairman, Tax Authority, Egypt, and his team, to meet with its members and give a presentation on the new VAT law and also address some of the issues being faced by the members.

The meeting, held on 7 December in Cairo, was presided over by Mr Sanjay Bhattacharyya, Ambassador of India to Egypt.

The Chairman and his team gave a very informative presentation on VAT and also laid down the procedures being followed by the Authority to ensure its proper implementation. The VAT encompasses all the other types of taxes in the system.

MadaGasCar

ties with MadagascarA six-member multi-sectoral CII business delegation visited Madagascar from 12-14 December, after a gap of almost 8 years. The delegation, representing sectors such as infrastructure, power, water, agriculture, mining, renewable energy, and manufacturing, had meetings

shobana Kamineni, President designate, Cii, and executive Vice Chairperson,

apollo hospitals enterprise limited, with the hon. Malcolm turnbull,

Prime Minister of australia,in Melbourne

hery rajaonarimampianina, President of Madagascar, with members of the Cii business delegation, in antananarivo



with Mr Hery Rajaonarimampianina, President of Madagascar, and Mr olivier Mahafaly Solonandrasana, Prime Minister of Madagascar, as well as other government officials.

A business seminar and B2B networking session organized by the Indian Embassy, Antananarivo, in partnership with CII on 13 December, was attended by more than 75 companies, and regional chambers. CII signed an MoU with the local chamber on the occasion.

The meetings highlighted that Madagascar is prioritizing project development in energy, specifically so l a r p ro j ec t s , ag r i cu l tu re , infrastructure, especially expansion of ports and water, for drinking and irrigation. The Prime Minister invited Indian companies to set up joint ventures with Malagasy operators, and take advantage of tax-free exports to other countries by making use of existing market agreements.

Madagascar sought India’s help in transfer of knowledge and technology, as well as renovation of several existing facilities. It is also looking to learn from India’s experience in the e-commerce sector and for the creation of Special Economic Zones (SEZs), especially for textiles and agriculture.

Qatar

Mou to support delivery of fifa tournament During the India visit of Sheikh Abdullah Bin Nasser Bin Khalifa Al-Thani, Prime Minister and Minister of Interior, Qatar, CII and the Supreme Committee for Delivery & Legacy, entered into an MoU to establish a partnership for co-ordination and cooperation between Indian and Qatar companies for the delivery of the 2022 FIFA World Cup Qatar™ Tournament.

The MoU was exchanged between Mr Ali Sharif Al Emadi, Minister of Finance, Qatar, and Mr Chandrajit Banerjee, Director General, CII, in the presence of Mr Narendra Modi, Prime Minister of India, and Sheikh Abdullah Bin Nasser Bin Khalifa Al-Thani, Prime Minister of Qatar, in New Delhi on 3 December.

The Supreme Committee for Delivery & Legacy is the competent authority for the FIFA 2022 Tournament with all powers and authority necessary to achieve its goals in all areas related to the tournament.

toGo opportunities in togoMr Gilbert Houngbo, Former Prime Minister of Togo, briefed industry members about various trade and investment opportunities, especially in healthcare, infrastructure and agriculture, in Togo, at an interaction on 12 December in New Delhi.

Mr Houngbo was the Prime Minister of Togo since September 2008 and was further reappointed to head the Government in March 2010. He has contributed extensively to the economic development of his country.

Mr Umang Chaturvedi, Member, CII Africa Committee, and Group President - Corporate Affairs, RHC Holding Pvt Ltd, suggested agro and food processing, healthcare and pharmaceuticals, and infrastructure and mining, as areas where India could collaborate with Togo.

usa

Cii north america iBf final 2016 MeetingCII North America hosted members of the CII-India Business Forum (Indian companies with operations and investments in the United States) for a series of meetings in Washington DC on 14 December, the first gathering of the group since the Presidential elections.

Following a lively internal strategy meeting where challenges and opportunities for 2017 were discussed, the group headed over to the Embassy of India to meet with Amb. Navtej Sarna, the new Ambassador of India to USA. Ambassador Sarna discussed the overall

exchange of Mou between ali sharif al emadi, Minister of finance, Qatar, and Chandrajit Banerjee, director General, Cii, in the presence of narendra Modi, Prime Minister of india, and sheikh abdullah bin nasser bin Khalifa al thani,

Prime Minister and Minister of interior, Qatar, in new delhi



US-India bilateral partnership as well as potential avenues for collaboration and engagement with the incoming Trump administration.

The IBF members also met with faculty from the Heritage Foundation, a pre-eminent think tank in Washington DC. Mr James Carafano, Vice President of Foreign and Defense Policy Studies; Lisa Curtis, Senior Research Fellow (South Asia); and Bryan Riley, Senior Policy Analyst in Trade Policy, held discussions with

the IBF members on trade and commercial issues and concerns within the overall US-India relationship and ways in which some of these could be addressed.

us ambassador shares experiences In collaboration with the Indo-A m e r i c a n F r i e n d s h i p A s s o c i a t i o n , C I I hosted a ta lk by Amb. Richard Verma, Ambassador of the United States of America to India, on 6 December in New Delhi.

S h a r i n g h i s experiences during his tenure in India, Amb. Verma stated that the last two years have been fundamental years of Indo-American bilateral relations, moving from a commercial and business relationship to a more strategic level. He also spoke about the vision of the incoming US administration with respect to India, demonetization and its possible impact on India-US relations, and more.

Cii india Business forum usa members with amb. navtej sarna, ambassador of india to the united states, in Washington dC

amb. surendra Kumar, founding President,indo-american friendship association; amb. richard Verma, ambassador of usa to india, and

Chandrajit Banerjee, director-General, Cii, at a session in new delhi

Members are earnestly requested to adopt the CII Model Code of

Conduct, if not already done. (Members could confirm their adoption of the CII Model Code of Conduct by using the link)

http://www.cii.in/codeofconduct What Does It Cover

Maintaining : Accurate Books and Records Prohibits : Bribery and Corruption Equality : Fair and Equitable Treatment Work Environment : Healthy and Safety Measures Standards : Quality of Goods and Services Social Welfare : Environment and Society

CII Model Code of Conduct

>>>> The names of the companies that have adopted the code would be reflecting on the CII Website <<<<


Regional Review

eastern reGionE

Manufacturing excellenceThe Manufacturing Excellence conference in Kolkata on 17 December had the theme of ‘Intelligent Manufacturing – The Game-changer for Industry.’

The event featured the presentation of the CII Eastern Region Productivity Awards 2016. Tata Steel won the CII Rotating Shield for sustained high overall productivity, while Aditya Aluminium, a unit of Hindalco Industries Ltd, was awarded for significant improvement in productivity. Certificates of appreciation went to Exide Industries, Haldia, Tata Sponge Iron Ltd, and Bokaro Steel Plant, Energy Management Department.

Brand ConclaveMr Martin Lindstorm, globally acclaimed brand guru, presented a palette of imagery, examples and references from contemporary history, and logic, to explain why a brand is not owned by companies, but by consumers, at the 15th

CII Brand Conclave held in Kolkata on 15 December. Mr Lindstrom, who advises global companies such as McDonald's, Procter & Gamble, Microsoft, the Walt Disney Company and GlaxoSmithKline, presented a behavioral economics approach to better communicate the benefits of a product or experience, by explaining that, “It is the brain where vision rests, and it is vision that gives birth to inspiration, innovation, and revolution...Use your brain to get a deeper understanding

of the choices the consumers are making, or going to make.”

insureind – industry-insurance PartnershipThe global reinsurance companies slated to get final clearance from the Insurance & Regulatory Development Authority of India (IRDAI) for opening branches in India are expected to start operations in the next 6-9 months, shared Ms Vijayalaxmi R Iyer, Whole Time Member (Finance & Investments), IRDAI. This is one of the steps towards developing India as a reinsurance hub, she said, at the 2nd InsureInd – Industry-Insurance Partnership on 16 December in Kolkata. IRDAI has received seven applications from foreign insurers, she added.

The inaugural session saw the launch of a CII-Deloitte knowledge paper on ‘Insuring Wealth & Insuring Human Capital – Necessity for Tomorrow.’

transport expo 2016The West Bengal Government has set up a task force to build a roadmap on how to face the challenges posed by demonetization, said Mr Alapan Bandyopadhyay, Principal Secretary, Transport, West Bengal, at the inauguration of Transport Expo 2016, held in Kolkata from 3-5 December. He urged CII to come up with ideas for the Government, industry and other stakeholders to work together in the transport sector, which is full of potential.

hr Conclave The HR Conclave 2016, with the theme of ‘HR an Enabler of Business,’ provided comprehensive insights

t V narendran, Chairman, Cii (er), and Md, tata steel ltd, presenting the Cii rotating shield for sustained overall Productivity to the team from tata steel, during the Manufacturing excellence

conference in Kolkata

at insureind in Kolkata

Martin lindstrom, Brand Guru

sanjiv Paul, Chairman, Cii (er) trade fair task force, and Md, tata Metaliks ltd; alapan Bandyopadhyay, Principal secretary, department of transport, West Bengal, and t V narendran, at transport expo 2016 in Kolkata


REGIoNAL REVIEW

on what CEos expect from an HR manager in respect of managing employees’ performance, and how an HR manager can act as a business partner, helping the company to prepare strategies to respond to VUCA (Volatility, Uncertainty, Complexity and Ambiguity).

at the hr Conclave in Kolkata

assam road show

The Government of Assam is working on a new industrial policy to maximize the ‘core strength’ of the State by leveraging its natural resources such as sugarcane, pineapple, and bamboo, said Mr Chandra Mohan Patowary, Minister of Industry and Commerce, Assam, at the Assam Investment Roadshow on Food Processing, Plastic and Bamboo, organized by the State Government in association with CII in Kolkata on 5 December.

“As Assam is primarily agrarian, we have set up industrial parks for food processing and bamboo. We have also set up a plastics park. Businesses need to just come here and work on a 'plug & play' model. Investments will be cleared in a week’s time," said the Minister. The new policy, he added, would offer easy availability of land and water, provide incentives, and make doing business easy, “We aim to be among the top five States in the country in terms of ease of doing business," he stated.

north east reGionNE

s K Barua, Chairman, Cii assam, and director (finance), nrl; ravi Capoor, additional Chief secretary, industries and Commerce, assam; sandipan Chakravortty, Chairman, Cii north east Council, and Chairman, tMil ltd; Chandra Mohan Patowary, Minister of industries & Commerce, assam, and

Chitranjan dar, Group head – Central Projects, r&d, eh&s, Quality assurance, itC ltd, at the assam roadshow, in Kolkata

Mr Ravi Capoor, Additional Chief Secretary, Department of Industries and Commerce, Assam, said the State Government wants to make Assam the ‘starting point, launch pad and springboard’ for South East Asia and the ASEAN countries.

Mr Sandipan Chakravortty, Chairman, CII North East Council, and Chairman, TMIL Ltd, invited companies to populate the three sophisticated, well-equipped industrial parks being set up in Assam for food, bamboo and plastics.

Welcoming the State Government’s efforts towards industrialization and job creation, Mr Abhijit Barooah, Co-Chairman, CII North Eastern Council, and MD, Premier Cryogenics Ltd, also made a presentation on the first-of–its-kind bamboo technology park.

The event had three parallel sessions on food processing, plastic and bamboo, followed by one-on-one interactions of investors with the Minister and senior Government officials.

act east through north eastThe seminar on ‘Act East through North East: from Land Locked to Land Linked,’ was organized by CII with support from oNGC Ltd on 22 December in Agartala, to encourage industry to invest in Tripura.

Mr V K Gupta, officiating Asset Manager, oNGC Ltd, pointed to the availability of abundant gas reserves for sectors such as rubber, bamboo and food processing, and suggested that improved access through roads, rails and ports in Bangladesh could help resolve the connectivity issues in the North East.

As much as 96% of the region shares international borders, said Mr Pradeep Bagla, Co-Chairman, CII

susanta dutta, deputy secretary, department of PWd (roads & Bridges), Tripura; V K Gupta, Officiating Asset Manager, ONGC Ltd

(tripura asset); and Pradeep Bagla, Co-Chairman, Cii north east Core Committee on infrastructure, and Md, amrit Cements ltd,

at the seminar on ‘act east through north east in agartala.


REGIoNAL REVIEW

North East Core Committee on Infrastructure, and MD, Amrit Cements Ltd, welcoming the ‘positive steps’ taken by both the Central and the State Governments to boost intra and inter regional connectivity, such as the renewal of the inland water transport protocol, the MoU on the use of the Chittagong and Mongla ports, and bus services between Guwahati, Shillong, Agartala and Kolkata, and Dhaka.

interaction on Gst“The Goods and Services Tax (GST) regime will make the tax system transparent and seamless, said Mr Anurag Goel, Commissioner of Taxes, Assam, at an interaction with industry members on 20 December in Guwahati. GST will reduce the current system of filing 130-150 returns to only 13 returns in a year, thereby lessening the paperwork drastically, he explained.

interaction on Gst in Guwahati

northern reGionN

Bicycle exCon 2016CII, in collaboration with the All India Cycle Manufacturers Association, the Government of Punjab, and the Chandigarh Administration, organized the first ‘Bicycle ExCon 2016’ on 8-9 December in Chandigarh. The event engaged 14 countries and leading companies of the bicycle industry to provide a new vision to the bicycle industry in the Asia Pacific region.

“yoga and bicycling can be a panacea to most lifestyle ills,” said Mr V P Singh Badnore, Governor, Punjab, and Administrator, UT Chandigarh, addressing global bicycle industry leaders at the inaugural session of Bicycle ExCon 2016.

“Punjab has been ranked top in India in terms of infrastructure facilities. It offers best-in-class connectivity

V P singh Badnore, Governor, Punjab, and administrator, ut Chandigarh, and

Madan Mohan Mittal, Minister of industries & Commerce, Punjab, inaugurating Bicycle exCon 2016 in Chandigarh

Pankaj Munjal, Chairman, Bicycle exCon 2016, and CMd, hero Cycles ltd; dr Zhaoyang Wang, Ceo, Meile Group, China; antony lo, President,

Giant Manufacturing Co ltd, taiwan; Madan Mohan Mittal; Ma Zhongchao, Chairman, China Bicycle association, and V P singh Badnore

There will be a single e-waybill for transporting goods across the country, and transport vehicles would have a compulsory RFID card, he said, observing that the new tax regime would make it difficult to conceal incomes."

Mr Abhijit Barooah, Co-Chairman, CII North East Council, and MD, Premier Cryogenics Ltd, said Himalayan States, including the North-East, have been given special status in the Act.

with a well-connected road network, international airbase, abundant water supply, and power. Availability of technocrats and skilled labor make Punjab a fertile market for the bicycle industry to flourish,” he said. He welcomed the new ‘Heritage Walk’ in Amritsar with a no-vehicle zone, as an exemplary step in making the Holy City eco-friendly.

CII and the Government of Punjab have joined hands to promote the latter’s ambitious project to set up a state-of-the-art ‘Cycle Valley’ in Dhanasu, near Ludhiana. The ‘Cycle Valley’ will provide a complete ecosystem to attract leading bicycle, e-bike and bicycle parts manufacturers to set up manufacturing units.

“The Cycle Valley will foster technology and knowledge exchange and collaboration for bicycle and e-cycle


Meeting with Chief Minister of tamil naduA C I I t e a m m e t M r o Panneerselvam, the new Chief M i n i s t e r o f Tamil Nadu on 26 December in Chennai.

The CII team, led by Mr Ravi Purushothaman, Vice Chairman, CII Tamil Nadu, and President, D a n f o s s Industries Pvt Ltd, briefed the Chief Minister on CII’s work in the State, and various initiatives in partnership with the State Government, including the relief work undertaken after Cyclone Vardah. The members also sought his support and guidance, moving forward.

relief Measures for Cyclone VardahIn a bid to bring immediate relief to thousands of people affected by Cyclone Vardah on 12 December in Chennai, Tiruvallur and Kanchipuram and surrounding areas in Tamil Nadu, CII has formed special teams to support the district administration’s relief measures.

The CII leadership met with senior officials of the State

manufacturers of Punjab,” said Mr Madan Mohan Mittal, Minister of Industries & Commerce, Punjab. one of the strengths of the State is its thriving eco-system of well-established MSMEs, and 90% of the bicycle component manufacturing industry is small scale, he added.

The annual carbon emission reduction from riding an e-bike is equivalent to growing 22 trees, observed Mr Ma Zhongchao, Chairman, China Bicycle Association. As there are 143 million e-bikes in China, the overall carbon reduction effect is comparable to growing 1,60,000 hectares of tree cover. At present, nearly 100 cities in China are implementing public bicycle rentals, and about 30 cities possess dedicated green bike paths, he said.

Members of the Asian Bicycle Alliance, and bicycle associations of SAARC and other countries came together to explore business opportunities in manufacturing, assembling, infrastructure and other aspects of the cycle industry. The event drew more than 60 foreign delegates from 14 countries, including China, Sri Lanka, Hong Kong, Japan, Jordon, Taiwan, Russia, Germany, Myanmar, Bangladesh, Mozambique, Switzerland, USA and Iran. Representative member companies of the bicycle associations of countries such as China, Japan, Jordan, Taiwan, Mozambique, Bangladesh and Iran were among the participants. The two-day event featured conferences on various issues facing the bicycle industry, besides a not-for-sale display of products and business meetings.

CII, in collaboration with the Chandigarh Administration, organized a ‘cyclothon’ on the second day of the international event. over 400 budding cyclists and enthusiasts of all ages pedaled alongside international pros to spread the message of a peaceful, healthy, cleaner and greener planet. There were three races in different categories, including a competitive ride up to 14 km, a 10 km corporate ride and a 6 km fun ride.

roadshows for Pravasi haryana divasCII and the Government of Haryana organized a series of

roadshows in Kolkata, Hyderabad and Mumbai, on 9, 11 and 12 December respectively, in the run-up to the Pravasi Haryana Divas held in Gurugram on 10-11 January.

At the Mumbai Roadshow, investments worth `1,700 crores were announced for the State, while in Hyderabad, a MoU was signed between Janani Foods Pvt Ltd and HSIIDC, Haryana, for setting up an integrated horticulture processing project in Barwala. Addressing the Kolkata Roadshow, Mr Vipul Goel, Minister of Industries, Haryana, said the setting up of a special Skill Development University, and the Haryana Kaushal Vikas Nigam would pave the way towards a modern future. The State Government is working on policies for key sectors to boost the Ease of Doing Business, he added.

REGIoNAL REVIEW

southern reGionS

o Panneerselvam, Chief Minister of tamil nadu (center) with K ramasamy, Vice Chancellor, tamil nadu agriculture

university (left), and ravi Purushothaman, Vice Chairman, Cii tamil nadu, and

President, danfoss industries Pvt ltd (right), at a meeting in Chennai

exchange of Mou on setting up an integrated horticulture processing project in Barwala, between Janani foods Pvt ltd

and hsiidC, in hyderabad

Vipul Goel, Minister of industries, haryana


Ramesh Datla, Chairman, CII Southern Region, and CMD, ELICo Ltd, briefed her on various CII initiatives for the development of Puducherry.

Members' Meet with Vice President, CiiMr Rakesh Bharti Mittal, Vice President, CII, Chairman, CII National Membership Council, and Vice-Chairman, Bharti Enterprises, spoke about CII’s initiatives and priorities at an interaction with members in Kochi on 5 December.

foodCon 2016The 5th edition of FoodCon, held on 2 December in Chennai, explored recent advances in the food processing sector. The interactive sessions spanned future trends in food and nutrition; recent advances in processing technologies for high value commercial products/business, and the latest innovations in storage, handling and packaging.

Manufacturing excellence study MissionThe CII (SR) Manufactur ing Sub-Committee

organized a Manufacturing Excellence Study Mission to industries of excellence in Gurugram on 8–9 December. The mission enabled companies from the Southern Region to observe excellent practices and innovative processes being adopted by manufacturing organizations, such as Sona

Koyo Steering Systems Ltd, JCB India Ltd, Munjal Showa Ltd and Carrier Airconditioning & Refrigeration Ltd.

REGIoNAL REVIEW

Government and offered industry support towards immediate relief measures in the affected areas.

CII members companies deployed excavation machines, tipper trucks, lorries, machinery and manpower to clear approximately 20,000 tonnes of debris at the required sites, and restore normalcy.

CII is also coming out with a medium term strategy for preparedness and mitigation of disasters.

session with Kerala MPs

CII Kerala organized a meeting with 12 Members of Parliament from Kerala in New Delhi on 8 December. The meeting discussed various CII initiatives in the State, and also the key projects to be implemented for the overall development of Kerala.

Meeting with lt. Governor of PuducherryA CII team called on Dr Kiran Bedi, Lt Governor of Puducherry, on 3 December. The team, led by Mr

relief work in cyclone-affected areas in Chennai

rakesh Bharti Mittal, Vice President, Cii, Chairman, Cii national Membership

Council, and Vice-Chairman, Bharti

enterprises

Members of Parliament from Kerala at an interactive session in new delhi

dr Kiran Bedi, lt. Governor of Puducherry, with a Cii delegation in Puducherry


REGIoNAL REVIEW

W Western reGion

WasteCh 2016 As a run-up to the Vibrant Gujarat Global Summit 2017, the Forests and Environment Department, Gujarat, the Gujarat Pollution Control Board (GPCB) and CII, organized the 2nd edition of ‘WASTECH 2016: International Summit & Expo’ from 2-4 December, in Gandhinagar, to promote s u s t a i n a b l e d e v e l o p m e n t in the St a te through waste management.

The Summit was inaugurated by Mr Anil Madhav D ave , U n i o n Minister of State ( I n d e p e n d e n t C h a r g e ) o f E nv i r o n m e n t , Forest and Climate Change, and Mr Vijaybhai Rupani, Chief Minister of Gujarat. From the Gujarat Government, Mr Shankarbhai Chaudhary, Minister of State (Independent Charge) of Environment; Dr J N Singh, Chief Secretary, Mr Arvind Agarwal, Chairman, GPCB, and Additional Chief Secretary, Forests and Environment Department, and Mr Hardik Shah, Member Secretary, GPCB, were also present. Mr S P Singh Parihar, Chairman, Central Pollution Control Board; and Mr Gopi Shankar, Director, Trade and Industry, State of Victoria Government, Australia, also participated in the inaugural.

The Summit, with 13 technical sessions addressed by 60 international and national speakers, was attended by 3,500 delegates, while the three-day exhibition attracted

approximately 9,000 visitors. Around 116 slogans were written, and more than 1,000 participants took the environment quiz in the exhibition area. Making it truly ‘zero-waste,’ 1,150 kg of dry waste and 656 kg of wet

waste generated during the event was sent for recycling.

Cii Vidarbha investment summit and expositionCII, in partnership with the Government o f Maharashtra, organized the Vidarbha Investment Summit and Exposition

2016 on 15-16 December in Nagpur, to showcase the business potential and opportunities available in the region.

Mr Devendra Fadnavis, Chief Minister of Maharashtra, was the chief guest at the inaugural session, while Mr Subhash Desai, Minister of Industries, Maharashtra, delivered a special address.

West tech 2016 India should focus on increasing investments in in-house R&D in all areas of manufacturing and also in public research, educational institutions etc, said Dr Naushad Forbes, President, CII, and Co-Chairman, Forbes Marshall, at the 4th edition of West Tech, a flagship summit focusing on technology innovation, in Pune on 16 December.

Highlighting the need to build a skill-based and capital-intensive economy, with a focus on new sectors like aerospace and defence, pharma, automobiles, etc, he stressed on the importance of formulating policies for creating an innovation ecosystem.

Dr y S Rajan, Honorary Distinguished Professor, ISRo, and Chairman, Board of Governors, National Institute

anil Madhav dave, union Minister of state (independent Charge) of environment, forest and Climate Change, and Vijaybhai rupani, Chief Minister of Gujarat with other dignitaries

at Wastefh 2016 in Gandhinagar

sunil Khanna, Chairman, Cii Maharashtra, and President & Md, Vertiv; apurva Chandra, Principal secretary – industries, Maharashtra; dr Pawan Goenka, summit Chairman, and Md, Mahindra & Mahindra ltd; ninad Karpe,

deputy Chairman, Cii (Wr), and director, aptech subhash desai, Minister of industries, Maharashtra; devendra fadnavis, Chief Minister of Maharashtra; and sudhir Mehta, Chairman, Cii (Wr), and CMd,

Pinnacle industries ltd, at the Cii Vidarbha investment summit and exposition in nagpur


of Technology, Manipur, said all innovation should be commercially viable and should benefit the consumers. Continuous innovation is the order of the day, he said, adding that technology transfer right from the intermediate stage to the outcome stage would create a wider base for innovation.

Mr Sanjay Kirloskar, Chairman, West Tech 2016, and CMD, Kirloskar Brothers Ltd, observed that while internationally there is a conscious decision on investments in research and innovation, in India, we are yet to create a conducive environment for technology enhancement.

Innovation should be all-pervasive, and industry, academia and society need to work together to find innovative solutions to address societal needs, said Mr Sudhir Mehta, Chairman, CII Western Region, and CMD, Pinnacle Industries Ltd.

China Machinex and China homelife CII was the national partner for the 4th edition of China Machinex and China Homelife Fair India 2016, a mega expo held in Mumbai from 12-15 December. The inaugural of the fair, which welcomed Chinese investments in India across sectors such as electronics, automotive, and engineering goods, among others, was attended by

dignitaries from Government and industry, as well as a delegation from Wenzhou, China.

At the ‘China-India Economic Forum- Inclusive Growth of Economies’ conference held on 13 December in Mumbai, Mr K Nandakumar, Co-Chair, CII Task Force on Ease of Doing Business, and CMD, Chemtrols Industries Ltd, said synergies of the growth paths of the two nations offer huge opportunities for bilateral economic co-operation.

Cii Corporate Cricket Cup t10

The inaugural edition of the CII Corporate Cricket Cup T10 at the iconic Azad Maidan in Mumbai on 10-11 December drew enthusiastic participation from 14 corporate cricket teams. Standard Chartered Bank won the tournament, while WNS Global Services Pvt Ltd was the runner-up.

Cii fBn india family Business summit 2016CII FBN India organized the Family Business Summit on 12 December in Mumbai with the theme, ‘Professionalizing the Family Business – New Challenges and Best Practices.’ It covered topics like management development, working with non-family executives, governance practices, and the balance between an entrepreneurial and professional culture, as also the role of the family in the process of professionalization. Mr Albert Jan Thomassen, Executive Director, Family Business Network, Netherlands, an internationally recognized family business expert, led the discussions. There was also a case study discussion.

at the China - india economic forum Conference in Mumbai

sudhir Mehta, Chairman, Cii (Wr), and CMd, Pinnacle industries ltd; dr y s rajan, honorary distinguished Professor, isro, and Chairman, Board of Governors, national institute of technology, Manipur; dr naushad forbes, President, Cii, and Co-Chairman,

forbes Marshall Pvt ltd; and sanjay Kirloskar, summit Chairman, and CMd, Kirloskar Brothers ltd,

at the Cii West tech summit 2016 in Pune

at the Cii fBn family Business summit in Mumbai

REGIoNAL REVIEW

Cii Corporate Cricket Cup t10 in Mumbai

comm jan 2017

Economy & Finance