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VOL. LIII NO. 3

E D I TO R I A L BOA R D

Chairman of the Editorial Board

Shri P. Joy Oommen, IAS (Retd.)Chairman & Managing Director,Kerala Financial Corporation (KFC)Thiruvananthapuram

Vice-Chairman

Shri U.P. Singh, IRS (Retd.)Ex-Chief Commissioner, Income-Tax &TRAI Member

Members

Shri R.C. ModyEx-C.G.M., RBI

Shri P.B. MathurEx-E.D., RBI

Shri K.C. GanjwalFormer Member, Company Law Board,Government of India

Editor

Shri V. S. RathoreSecretary General, COSIDICI

Associate Editor

Smt. Renu SethSecretary, COSIDICI

MAY-JUNE, 2015

COSIDICI COURIER

BI MONTHLY JOURNAL OF COUNCIL OF STATE INDUSTRIAL DEVELOPMENT andINVESTMENT CORPORATIONS OF INDIA

The views expressed in the journal are those of the contributors and not necessarily ofthe Council of State Industrial Development and Investment Corporations of India.

CONTENTS

From the Desk of the Editor ................................... 2

Appointments ........................................................ 4

Questions of Cyberquiz – 54 ................................. 4

MSMES in the Inclusive Growth Agenda ............... 5

Tourism Entrepreneurship : .................................. 11

Thrust Areas for Action

Letter to The Editor .............................................. 14

Profile of Member Corporations ........................... 15

West Bengal Industrial Development Corporations (WBIDC)

Do You Know? ...................................................... 16

Member Corporations - Their Activities ................ 17

Micro, Small & Medium Enterprises ..................... 19

News from States ................................................ 20

Economic Scene ................................................. 22

Activities of COSIDICI ......................................... 27

Success Stories of Karnataka State Financial .... 31

Corporation Assisted Units

All India Institutions ............................................. 32

Infrastructure ....................................................... 35

Answers of Cyberquiz – 54 .................................. 35

Health Care .......................................................... 36

COSIDICI COURIER2

FROM THE DESK OF THE EDITORFROM THE DESK OF THE EDITORFROM THE DESK OF THE EDITORFROM THE DESK OF THE EDITORFROM THE DESK OF THE EDITOR

YOGA - INTEGRAYOGA - INTEGRAYOGA - INTEGRAYOGA - INTEGRAYOGA - INTEGRATES BODYTES BODYTES BODYTES BODYTES BODY, MIND & SPIRIT, MIND & SPIRIT, MIND & SPIRIT, MIND & SPIRIT, MIND & SPIRIT

Yoga is an ancient system of physical exercisesand postures, breathing practices and meditationintended to integrate body, mind, and spirit. Humanbeings are made up of three components—body,mind and soul and corresponding to these thereare three needs—health, knowledge and innerpeace. Health is physical need, knowledge is ourpsychological needs and inner peace is spiritualneed; when all three are present then there isharmony. Yoga originated in India several thousandyears ago, and its principles were first written downby a scholar named Patanjali in the second centuryB.C. The word Yoga comes from a Sanskrit word,yukti , and means “union”. Yoga is a spiritualdiscipline based on an extremely subtle science,which focuses on bringing harmony between mind,body and spirit.

Yoga is the art and science of healthy living. Theholistic approach of yoga is well established andit brings harmony in all walks of life by integratingmental, physical, and spiritual dimensions ofhuman life. Today, yoga is popular across the globe,not just because of its efficacy in the managementof a number of diseases, but also its potential forproviding relief from mental and emotional distressand providing a feeling of well-being.

Yoga Practices :

Good preparation for yoga requires spiritual andmental readiness as well as comfortable clothingand suitable space. Yoga practices generally beginwith stretches, postures (asanas) and simplebreathing exercises, intended to clear the mindas well as open up the lungs. The stretching,bending, and balancing involved in the asanas helpto align the head and spinal column; stimulate thecirculatory system, endocrine glands, and otherorgans; and keep muscles and joints strong andflexible. Yoga practice has shown to reduce therisk of heart disease by lowering blood pressureand anxiety levels. Western medical researchershave been studying yoga only since the 1970s

V.S. RATHORESecretary General, COSIDICI

and clinical trials in theUnited States havedemonstrated itseffectiveness in treatingasthma, osteoarthritis,heart disease, stress-related illnesses, highblood pressure, anxiety,and mood disorders. Thepractice of the asanasstrengthens the body andcreates a feeling of well-being.

The breath control exercises, known aspranayama , emphasize slow and deep abdominalbreathing. The practice of pranayam calms themind, benefits the respiratory system, helps toinduce a sense of relaxation, and is also useful inpain management. From the psychological viewpoint, meditation sharpens the intellect and aids inconcentration; it steadies the emotions andencourages a caring for others. Meditation hasbeen shown to strengthen the human immunesystem. Through meditation, inner peace isexperienced.

Benefits of Yoga in daily Life :

Improves flexibility, protects the spine, andbuilds muscle strength :

Improved flexibility is one of the first and mostobvious benefits of yoga. Each time you practiceyoga, you take your joints through their full rangeof motion which helps prevent degenerativearthritis and wear and tear of cartilage. Inflexibilityin muscles and connective tissues & ligamentscan cause poor posture. Strong muscles protectus from conditions like arthritis and back pain.When you build muscle strength through yoga, youbalance it with flexibility. In contrast, musclestrength built in gyms and by lifting weights comesat the expense of flexibility.

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Relaxes the nervous system, releases tensionin limbs and boosts immunity :

Physical activity is good for relieving stress, andthis is particularly true of yoga. When we contractand stretch muscles, move organs around, andcome in and out of yogic postures, we increasethe drainage of lymph (a viscous fluid rich inimmune cells). This helps the lymphatic systemfight infection, destroy cancerous cells, anddispose of the toxic waste products of cellularfunctioning.

While asana and pranayama improve immunefunction, meditation has the strongest scientificsupport of having the most beneficial effect on thefunctioning of the immune system, boosting it whenneeded (for example, raising antibody levels inresponse to a vaccine) and lowering it whenneeded (for instance, mitigating an inappropriatelyaggressive immune function in an autoimmunedisease like psoriasis).

The practice of pranayama and meditation calmsthe mind. When we slow our breath and focus onthe present, the balance shifts from thesympathetic nervous system (or the fight-or-flightresponse) to the parasympathetic nervoussystem. The latter is calming and restorative; itlowers breathing and heart rates, decreases bloodpressure, and increases blood flow bringing aroundthe relaxation response. The emphasis yogaplaces on being in the present moment helpsrelieve stress, as one learns not to dwell on pastevents or anticipate the future. After a yoga sessionone feels less stressed.

Increases self-esteem and gives innerstrength:

Many of us suffer from chronic low self-esteemwhich is usually handled negatively by takingdrugs, overeating, working too hard, over sleeping.This leads to poor health - physically, mentally,and spiritually. Yoga helps us to make changes inour life to overcome inertia and to changedysfunctional habits. Therefore, a positiveapproach is to practice yoga, which improves ourself-esteem and worth, as yogic philosophyteaches that we are a manifestation of the Divine.

With regular practice one experiences feelings ofgratitude, empathy, and forgiveness, as well as asense that we are a part of something bigger. Whilebetter health is not the goal of spirituality, it’s oftena by-product.

Builds awareness for transformation :

In the realm of the spiritual, yoga bringsawareness and the ability to be still, which makesit easier for us to break free of destructive emotionslike anger, greed and jealousy. Studies suggestthat chronic anger and hostility are as stronglylinked to heart attacks as are smoking, diabetes,and elevated cholesterol. Yoga reduces anger byincreasing feelings of compassion andinterconnection and by calming the nervoussystem and the mind. It also increases our abilityto step back from the drama of our life and remainsteady in the face of adversities. There is evidencethat yoga speeds reaction time and this extra splitsecond allows us to choose a more thoughtfulapproach, thus reducing suffering for ourselvesand others.

Conclusion :

The essence of Yoga is to make life more efficientand enjoyable. It is a continuous process and thedeeper one moves into yoga practice, the moreprofound are its benefits. Yoga is being practicedwidely across the globe, nearly 20 million peopleare practicing Yoga in US alone and this trend isfurther growing. In some countries, yoga has beenincorporated in the school curriculum. With theefforts of our Hon’ble Prime Minister, Shri NarendraModi who had proposed holding an InternationalYoga Day in his UN General Assembly speech inSeptember 27, 2014, the UN General Assembly(UNGA) has declared June 21 as “InternationalYoga Day”, recognizing ancient India’s ‘holisticapproach to health and well-being.’

(V.S. RATHORE)

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Q.1 The BPO company aims at stemming the migration of American jobs to foreign shore.Registered in a different country so as not to be governed by the US labor laws, it motesa concept called “Hybrid Sourcing” which involves housing a host of software developerson a ship just coast of a US harbor. Name the company. [a] Sea Code; [b] Hybrid BPO;[c] American BPO; [d] BPO-America.

Q.2 Which IT company’s logo was designed by Chetan K.S., then a seventeen-year-oldstudent of SpasticS Society School run by Spastics Society of Karnataka, India ? [a]MindSpace; [b] Sepctramind; [c] MindTree Consulting; [d] Bazee.com

Q.3 Which Indian company has the distinction of being the world’s first CMMi ver 1.1 Level 5 and PCMMI level 5 certifiedsoftware services company ? [a] Infosys Technologies; [b] TCS; [c] CMC Limited; [d] Wipro Technologies.

Q.4 DEC, the second largest computer company in the world in the 1980s, is no more existing. But its familiar ‘digital’ logois very much alive. Which company now owns it ? [a] Digital GlobalSoft; [b] Compaq; [c] HP; [d] Lenovo.

Q.5 Which company’s corporates philosophy is “You can make money without doing evil” ? [a] Infosys; [b] Google; [c]Apple Computer; [d] Yahoo !

Q.6 The “Intel Inside” campaign is one of the world’s largest co-operative marketing programs, supported by thousands ofPC makers who are licensed to use the Intel Inside logos on their products and promotions. Who launched thiscampaign in 1991 ? [a] Gordon Earl Moore; [b] Robert Noyce; [c] Anand Chandrasekher; [d] Dennis Carter.

Q.7 Which legendary CEO from the American computer industry was the official photographer in the wedding of LarryEllision and Melanie Craft ? [a] Bill Gates; [b] Steve Jobs; [c] Michael Dell; [d] Steve Wozniak.

Q.8 “Make Money Fast” (MMF) is the name of an electronically forwarded chain-letter scheme that has been made famousby many a scamster since introduced in 1988. Who first wrote it ? [a] David Rhodes; [b] George Parker; [c] CharlesPonzi; [d] Victor Lustig.

Q.9 What effort is being funded by Arthur C Clarke, Paul Allen, Gordon Moore and Hewlett-Packard cofounders WilliamHewlett and David Packard? [a] Spaceship One; [b] SETI (Search for Extraterrestrial Intelligence); [c] Internet 2Project; [d] Commercial Tourism to Moon.

Q.10 The SnowWhite design language is an industrial design language developed in the 1980s by the famed frog design. Inthis design, the computer cases have vertical and horizontal stripes for ventilation and aesthetic look. It also makesthe case look smaller than it actually is. Which Apple computer used this design language first ? [a] Lisa; [b]Apple I; [c] Apple IIc; [d] AppleiMac.

For Answer see Page No. 35

QUESTIONS OF CYBERQUIZ~54QUESTIONS OF CYBERQUIZ~54QUESTIONS OF CYBERQUIZ~54QUESTIONS OF CYBERQUIZ~54QUESTIONS OF CYBERQUIZ~54

♦ Shri Anindo Majumdar, IAS has beenappointed as Chairman & Managing Director,Delhi Financial Corporation {DFC}, New Delhivice Shri S.K. Srivastava, IAS.

♦ Dr. M. Beena, IAS has been apointed asManaging Director, Kerala State IndustrialDevelopment Corporation Ltd. {KSIDC},Thiruvananthapuram vice Shri SatyajeetRanjan, IAS.

♦ Shri Yogesh Kumar Goel, IAS has beenappointed as Managing Director, Punjab StateIndustrial Development Corporation Ltd.{PSIDC}, Chandigarh vice Shri RaminderSingh, IAS.

♦ Smt. Mamta Verma, IAS has been appointed

APPOINTMENTSAPPOINTMENTSAPPOINTMENTSAPPOINTMENTSAPPOINTMENTS

as ManagingDirector, GujaratIndustrial InvestmentCorporation Ltd.{GIIC}, GandhiNagarvice Shri G.C.Murmu.

♦ Dr. Rajesh Kumar,IAS has beenappointed asManaging Director,State Infrastructure & Industrial DevelopmentCorporation of Uttarakhand Ltd. (SIDCUL),Uttarakhand vice Shri Shailesh Bagauli, IAS.

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The concept of ‘inclusive growth’ is an add-on“growth vs distribution”. The consensus of the late-20th century, and early 21st century is that, ratherthan ‘growth’ and ‘distribution’ being treatedseparately, there needs to be an approach wherethe two aspects meet each other. Thus comesthe discussions on the so called ‘inclusive growth’.While the global consensus and the level ofpolemics has settled down on the above lines, thepractice among countries tell a different story.Depending upon the particular situation ofcountries, the theory, practice and commonunderstanding of ‘inclusive growth’ vary.

The concern with the role of micro, small andmedium enterprises (MSMEs) in India hassignificant political and social overtones. It beganwith the ‘Freedom Struggle’ in the country, wherein,the role of self reliant political units of administrationand a decentralized economy that is based onlocal resources, business opportunities, andmarkets was articulated. In the model developedby economist Mahalanobis, the small enterprisesector in India was visualized as an engine ofgrowth, but playing a subsidiary role to the coresectors of the economy. Though the perceptionon ‘inclusive growth’ was there from the days ofthe Second Five Year Plan, the word was coinedmuch later.

While the popular perception on ‘inclusive growth’continues, there are several challenges on thesustainability side. In addressing thesechallenges, one’s socio-political perceptionmatters a lot. An impor tant and generallyacceptable factor is sustainability. Thesustainability debate has come as part of thedebates on India’s growth paradigm andexperience.

Irrespective of the rates, growth and diversificationhave significantly taken place in the Indianeconomy over the past several decades. Whilegrowth is a hard core economist’s concern, it isthe challenge of policy to ensure that the fruits ofgrowth are made felt to the majority of the people.It is in this context that social cushions are needed.

MSMEMSMEMSMEMSMEMSMEsssss IN THE INCLUSIVE GROWTH AGENDA : A PERSPECTIVE IN THE INCLUSIVE GROWTH AGENDA : A PERSPECTIVE IN THE INCLUSIVE GROWTH AGENDA : A PERSPECTIVE IN THE INCLUSIVE GROWTH AGENDA : A PERSPECTIVE IN THE INCLUSIVE GROWTH AGENDA : A PERSPECTIVE

* P M Mathew

Traditionally, thisessentially social role hasbeen visualized in thecontext of the MSMEs.

While, traditionally, thissocial role was perceivedto be performed throughan automatic route, thesituation has changeddrastically in the recentpast. While the economychanges structurally, there are likely to be leadersand laggards in such a change. The laggards arelikely to be left out. How can they also beaccommodated into the mainstream? This is achallenging question. At the periphery of the Indianeconomy, SMEs perform their crucial role.

Inclusiveness: Differing Perceptions

Strategy becomes all the more important in adiscussion on inclusiveness. India’s strategy ofMSME development has broadly undergone threegenerations of strategies: First, there was thetraditional strategy of protection and reservation.This was followed by a strategy which was closerto a rights-based approach. Thirdly, and morerecently, the country follows a capabilitiesapproach. Under this approach, it is assumedthat, given proper capabilities, the country can takeits MSME sector into the mainstream of thedevelopment agenda.

The more recent policy announcement of theGovernment of India provides indication on this.On one hand, there are the flag-ship programmesthat are meant for meeting the objectives of nationalpolicy. On the other hand, as a corollary, there isa focus on skilling and entrepreneurship creation.The synergy of these two aspects is capable ofensuring that the creativity and energies of thepeople of this country, are channelized intoproductive and socially meaningful activities. TheGovernment, of late, has taken several steps inthis direction. However, the finer aspects of theseneed to be properly understood.

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Significance of the New Policy Thrust

The new public policy approach in India whichdistinguishes between ‘government’ and‘governance’, has much significance against thedebates on the policy process in the country.Studies have shown that, public policy-making inIndia has frequently been characterized by afailure to anticipate needs, impacts, or reactionswhich could have reasonably been foreseen, thusimpeding economic development. Policies havebeen reversed or changed more frequently thanwarranted by exogenous changes or newinformation. India’s policy making structures havebeen cited to be so much inefficient or incapablewith difficulty in formulating the “right” policy andthen sticking to it.

According to Agarwal and Somanathan (2005), a“good policy-making process” would meet thefollowing criteria : -

♦ The problems and issues confronting asector are subjected to expert analysis;

♦ Information on overlaps and trade-offs withother sectors is systematically gathered andmade available to policy-makers;

♦ Opposing points of view within and betweensectors, are properly articulated, analyzedand considered and those likely to bebenefited or harmed are identified and theirreactions anticipated;

♦ Decisions are made with due legal authority,after consultation of those likely to beaffected, and with the involvement ofknowledgeable persons in the sector(s)concerned;

♦ Those responsible for implementation aresystematically involved in the process, butare not allowed to take control of it;

♦ Policy-makers and/or their advisers have thehonesty, independence, intellectual breadthand depth to properly consider and integratemultiple perspectives and help arrive atoptimal policy choices within a reasonabletime.

The record of MSME development initiatives in thecountry over the last 6 years demonstrates thepresence of varied programmes, targeting

functional areas, subsectors and social groups.However, there is a general perception that thebenefits of the programmes did not actually reachthe intended beneficiaries in the manner and timethey were envisaged. In this context, there aretwo imperatives: first, there needs to be anintegrated view of programmes. Besides, thereneeds to be a focus on the actual delivery of theseprogrammes, without having leakages.

Based on the indication given by the EconomicSurvey and the latest Union Budget, there aresome impor tant steps that need closerexamination and critical review:

Focus on Start-up

While there has been an accepted model of start-up promotion around the world today, India, withits significant demographic dividend needs to givetop priority on harnessing the motivational skillsof the young people, than equipping them as wageearners. As indicated by the Union Budget andthe Economic Survey, a beginning has been madein this direction by putting forward an integratedapproach to start-up.

Thrust on Local Manufacture

India’s backlash on the manufacturing front, overthe last two decades, has caught significant policyattention. The National Manufacturingcompetitiveness Programme (NMCP) and theNational Manufacturing Policy were a responseto that. However, an assertion on positioning thecountry as the world’s manufacturing hub, withclear milestones, is a remarkable development.

India’s new perspective on manufacturing waskick-started with its new policy on defenceequipments that was announced in May, 2014.Following this, a policy on local manufacture wasannounced by the Prime Minister on August 15,2014. Banding India’s manufacture with a centralplace for MSMEs, was the first attempt inIndependent India towards boosting the morale andself-esteem of the MSME sector.

A New Understanding on Skill Development

Even against the major initiatives on technical andvocational education, the Indian economy suffersfrom a serious skill-gap. However, the dimensionsof the problem have not been holisticallyunderstood and translated into policy interventions.

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Until recently, the policy approach was essentiallyone of strengthening vocational educationinfrastructure, and to prove add-ons to it.

A major departure from the above approach wasintroduced by the Union Budget 2014. The Budgethas an integrated approach by which modular andmotivational skills are harnessed side by side. Theflagship programme, ‘Skill India’, if properlyorganised, can go a long way in triggering avigorous start-up movement in the country.

Integrated view of Manufacture and MSMENiche

As noted already, the National Manufacturingcompetitiveness Programme (NMCP) and theNational Manufacturing Policy, have undoubtedlyhighlighted the importance of boosting manufacturein the country. However, on translating theProgramme into schemes, the record so far hasnot been commendable. More recently, theidentification and thrust given to three focal sectorsis indicative of the more concerted effort that islikely to go into these subsectors. They are: (1)defence production; (2) electronics; (3) textiles.

Harnessing the Potential of Socially MarginalGroups

Managing multiculturalism is indeed greatchallenge and oppor tunity in the MSMEconstituency. India as a country, and morespecifically in the rural setting, the configurationsof caste and language get reflected in enterpriseclustering and recruitment strategies. With India’sdiverse groups of communities from differentcultural backgrounds getting empowered andachieving educational attainments, the sociallymarginalized groups are likely to be increasinglyabsorbed by the MSMEs. But how far are MSMEsequipped to manage such diversity? It is, at thetime a question of social engineering and publicpolicy.

The so called ‘Social Marginality Thesis’ states that,the marginal communities in a society contributemore significantly to economic development, thanthe mainstream communities. This globallydemonstrated behaviour pattern has significantimplications for India’s development strategy. InIndia, the socially marginal groups, as per theConstitution have been identified as eligible forsome special protection and privileges. The setting

up of the Ministry of Minority Affairs has gone along way in coordinating these activities. However,how to harness the economic potential and specialcapabilities of these communities in the agenda ofeconomic development? This crucial question hasremained only partially addressed so far.

On one hand, the minority groups in any societyoften have difficulty in getting integrated with themainstream, and therefore, they often try to identifyparticular economic time zones. On the otherhand, in many countries, the minorities are notproperly integrated into the main stream economicsectors by public programmes. As a result ofthese, one can find ethnic and regional minoritiesin most countries remaining comfortable with theirparticular economic activities. Example: Batikcraft in Vietnam, crafts and cloth of Yugur minorityin China, ethnic food items of Chinese Kazakminority, are examples. In the Indian context,brassware in Moradabad, lace-making inNarzapur, wooden toy-making in Channapatnam,and Udupi Hotels in Karnataka are some of theexamples having their ethnic stamp and reputation.

The Union Budget 2014 came out with aprogramme for the upgradation of skills and trainingin ancestral arts for development of the minorities.This programme called ‘Up gradation of traditionalskills in arts, resources and goods’, announcedby Budget, would be launched to preserve thetraditional arts and craft which are a rich heritage.Despite this high relevance of multi-culturalismand the significant economic role of the minorities,no attempt so far has been made to identify andintegrate the role of these communities with theexisting knowledge system that support policymaking in the country.

Critical Areas of Concern

Despite all the changes, as outlined above, thereare critical areas that deserve special mention: 1.use of knowledge for development; 2.entrepreneurship as a critical resources; 3. amassive capacity building in an integrated manner;4. integration of social consciousness with abusiness case (eg: promotion of social enterprises)

Knowledge for development

The rapid changes in the so-called ‘developedeconomies’, are associated with a new dynamics,new rules, and new drivers for success. The

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greatest structural change in the global economyduring the past quarter century, has been thegrowth of the knowledge economy. Theprominence of knowledge as a critical input impliesa division between the old economy and the socalled new economy. These countries arechanging from an industrial economy based onsteel, automobiles, and roads to a ‘new economy’built on silicon computers and networks. Thisimplies a significant shift in economic relationships,that is as significant as the previous displacementof the agricultural age by the industrial age. The‘new economy’ is all about competing for the future,the capacity to create new products or services,and the ability to transform businesses into newentities. While these new entities could not beimagined yesterday, the day after tomorrow, theymay be obsolete as well. There are someimportant, but overlapping themes that differentiatethe ‘new economy’ from the old. They are: 1)Knowledge; 2) Digitization; 3) Virtualization; 4)Molecularization; 5) Integration/internet working; 6)Dis-intermediation; 7) Convergence; 8) Innovation;9) Prosumption; 10) Immediacy; 11) Globalization;12) Discordance; and Boom of self-employment.

In India, despite its long history of MSMEdevelopment policy, our efforts towards knowledgecreation and its transmission to the context of thissector, is much below global standards. Forexample, the lifting of quantitative restrictions(QRs), that offered a protective framework to theMSMEs, was abandoned. However, beingexposed to the open market, the sector did notget the benefit. While a level playing ground wasexpected to be brought through the liberalizationpolicy, the result was not in tune with theexpectations of the sector. At the policy level, itwas argued that innovation is the mantra ofsustainability of the sector, but action in this regardwas relatively constrained.

In a knowledge economy, the sustainability ofMSMEs cannot be expected on a stand-alonebasis. It needs the benefits of inter-sectorallinkages. Here, the old concepts of developmentdependent essentially on imported technology,have a lesser role. In the ‘new economy’, spaceand time are crucial, they need to be best usedthrough local knowledge systems. India’s trackrecord relating to knowledge systems specific to

the MSME sector needs much moreimprovements. Such a knowledge system needsto be integrated and should touch upon and nourishthe whole value chain that is applicable to theMSMEs. ‘Make in India’, as a strategic approach,marks a departure from this beaten track. Ofcourse, its implications on MSMEs is debatable.

Entrepreneurship as a Critical Resource

Traditionally, in India, entrepreneurship wasconsidered as emerging from the businesscommunities. This stream of thinking underwenta radical change in the early 1970s, which gaveway for proactive entrepreneurship developmentpolicies through structured EntrepreneurshipDevelopment Programmes. Though this resultedin the mainstreaming of entrepreneurshipdevelopment through institutions and programme,the impacts are yet to be measured properly.Yardsticks for measurement need to be properlydeveloped. Entrepreneurship developmentinitiatives involve two crucial components: 1)program modeling; 2) delivery of programs.Several evaluation studies have indicatedconstraints on both counts.

Given the huge size of the country, and the largesize of its young population, it is necessary todevelop a proper approach to understanding,measurement and planning for entrepreneurshipdevelopment. It is in this context that a resourceapproach needs to be preserved and nourished.Against this imperative, the track record of policiesand strategies needs close examination.

Integrated Capacity Building

The word capacity building, in itself, is an integratedconcept. In any economy, the prevailing featuresof labour market determines the type of capacitythat needs to be created. However, approachesto capacity creation may vary.

The country presently faces the challenge of asignificant mismatch in the labour market. It leadsus to the imperative for skilling India’s youngpopulation on a war footing, so that their absorptioninto the productive sectors of the economy canbe enhanced. This solid argument was put forwardby the Prime Minister, in his Independence DaySpeech last year. He announced the flagshipprogramme called ‘Skill India’, which provides anoutline for the country’s labour market policy.

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However, the details of such a policy need to beworked out. The Ministry for Skill Developmentand Entrepreneurship has been set up inNovember 2014 to give fresh impetus to the ‘SkillIndia’ agenda and impart employable skills to itsgrowing workforce over the next few decades.

As India transforms itself into a knowledgeeconomy, there exists the need for energising,motivating, and skilling its population, especiallythe young, not only in quantitative, but qualitativeterms as well. This demands much moremeticulous work relating to institutions,programmes and standards. Such a strategicapproach presupposes a National Policy that actsas a thumb rule for India’s labour market agenda.

Skill development, however, cannot be viewed inisolation. Skills are fundamental to, but notsufficient for gaining decent jobs or to become agood entrepreneur. Labour market interventions,of which skill development forms a major part,needs to be demand –driven; they need to be anintegral part of the employment and economicgrowth strategies. Coordination with the othernational macroeconomic policies and strategiesis, therefore, critical. Therefore, the need forinitiatives in development of skills andentrepreneurship has to come from the need forenhanced income opportunities, including: 1) wageemployment; 2) self employment; and 3) labourexport. Wage employment ensures income forsurvival. Self-employment, besides contributing tosubsistence, is catalytic to income andemployment multiplier. Labour export adds to theforeign exchange resources of the country. Anintegrated labour market policy has to take careof all the three in a scientific manner. While allthese different aspects, though structurallyinterconnected, are taken care of by variousMinistries and Departments of the Government ofIndia, there needs to be functional synergy.

It is estimated that, during the seven-year periodof 2005-2012, only 2.7 million net additional jobswere created in the country. This indicates thatthe supply of wage employment in the country ismuch shorter, in relation to the demand. Therefore,at least a part of the job seekers, given the rightmotivation and orientation, can be channelized intothe entrepreneurship stream. This necessitatesprovision of proper business development

services (BDS), which includes training inentrepreneurship and mentoring as well.Recognizing the imperative for skill development,the National Skill Development Policy wasformulated in 2009. The National Policy on Skillsand Entrepreneurship Development 2015supersedes the Policy of 2009. The objective ofthis policy is to provide a framework for labourmarket interventions at scale, with speed, standard(quality) and sustainability. It aims to provide anumbrella framework to all skilling activities beingcarried out within the country, to standardize themand to ensure that they are market-driven. Inaddition to laying down the objectives and expectedoutcomes, the Policy also identifies the institutionalframework which will be the vehicles to reach theexpected outcomes. Skill development is theshared responsibility of a multi stakeholderplatform, including government, employers andindividual workers, with NGOs, community basedorganizations, private training organizations andother stakeholders playing a critical role.

The Prime Minister’s vision of ‘Skill India’ needs tobe taken forward within the framework ameaningful labour market policy, where everyMinistry/Department at the national and State levelhave a specific role to play. These roles need tobe specified in relation to their specific expertise,so that duplication of efforts are minimized.

Social enterprise

‘Impact investment’ and ‘social enterprises’ are twokey concepts in the semantics of responsiblebusiness today. However, these concepts are yetto pick up in the Indian context.

India, given its huge size, faces several socialproblems. These social problems need to beaddressed basically in terms of the presentresources and opportunities. In every socialproblem or social cost, there is an opportunity inwaiting it is the perception relating to tapping theseopportunities, that is central to the agenda ofsustainable enterprise development. ‘Enterprise’is a basic human trait which needs nourishmentin a particular context. In the case of a socialproblem, the opportunity is inherent and it has tobe identified and channelized for a meaningfulsolution. It is in this context that the relevance ofsocial enterprises arise.

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Social enterprises are defined as enterprises thatoperate like a business, produce goods andservices for the market, but manage theiroperations and redirects the surplus in pursuit ofsocial and environmental goals. They arerevenue-generating businesses with a twist.Whether operated by a non-profit organization orby a for-profit company, a social enterprises hastwo goals: (1) to achieve social, cultural,community; economic or environmental outcomes;and (2) to earn revenue. On the surface, manysocial enterprises look, feel and even operate liketraditional businesses. But looking more deeply,one discovers the defining characteristics of thesocial enterprise: the mission is at the centre ofbusiness, with income generation playing animportant supporting role.

Organizations may be placed on the socialenterprise compass, which measures enterprisesand organizations on a continuum between theprivate and public sectors. On the vertical axis,each enterprise or organization is categorized byits primary objective, from “social purpose” at thetop to “commercial purpose” at the bottom.

A ‘social economy’ develops because of a needfor new solutions for issues in a sociallyresponsible manner (social, economic orenvironmental) and to satisfy needs which havebeen ignored (or inadequately fulfilled) by theprivate or public sectors. By using solutions toachieve not-for-profit aims, a social economy hasa unique role in creating a strong, sustainable,prosperous and inclusive society. Defining thelimits of a social-economy sectors is difficult dueto shifting politics and economics; at any timeorganizations may be “partly-in, partly-out”,moving among sub-sectors of the social economy.

Successful social enterprises play a role in fulfillinggovernmental policy objectives by:

♦ Increasing productivity and competitiveness;

♦ Contributing to socially-inclusive wealthcreation;

♦ Enabling individuals and communities torenew local neighbourhoods;

♦ Demonstrating new ways to deliver publicservices; and

♦ Developing an inclusive society and activecitizenship.

Given the vastness of the country, India hasproduced several social enterprise models. Theyrange from purely government-designed ones toprivate models. Though there are many names inthis area, the country still lacks in a socialenterprise policy at the national level.

Despite India’s remarkable GDP growth over thelast two decades, one-third of the country’s 1.2billion population still lives below the poverty line.Besides, more than 40 per cent of children underfive are malnourished, while the World HealthOrganization says some 620 million people areforced to defecate in the open. Therefore,responding to these issues through sociallytargeted investments, or ‘impact investments’, isa major challenge.

Social enterprises can play a key role in India’sagenda of inclusive development. However, justlike in many other countries, they are not officiallyor legally recognised as a sector in India, evenwhile they play an important part in the fight againstpoverty.

While the challenges lie in defining what a socialenterprise is, once defined, it could pave the wayfor strong policies to help such businesses go fromidea to innovation. This could include investments,loans and grants for start-ups, incentives suchas tax-breaks, subsidies on land, power and water.Currently, most start-up social enterprises get theirfunding from foreign investors. However, there isenough capital in India, particularly with thegovernment and big corporations, to act asimportant investors.

Conclusion

Translating the concept of ‘inclusive’ from a politicalslogan into a no-nonsense, action orientedconcept, is the challenge before policy makerstoday. Small and medium enterprises, as aconstituency can play a significant role in thisregard.

* The author is Director, Institute of Small Enterprises and Development, Cochin. Source : Yojana

MAY-JUNE, 2015 11

Economists and policy makers in their search forsolutions to economic development have narroweddown on the inner drives and entrepreneurial spiritof the people. Whatever might be the supply andpotential of resources, nothing happens until allthose resources are judiciously put into use by anentrepreneur. Thus, it is appropriate to describean entrepreneur as a change agent and catalyst.Entrepreneurs are known for their vision, drive andtalent, who are adept in identifying opportunitiesand exploiting them for the good of the society.Entrepreneurs endow economic value to theresources. To quote Peter Drucker (2009) “everymineral is another rock and every plant is anotherweed, till someone finds a use”. They add to thematerial well being of nations through theirrelentless endeavours. To quote George Gilder,“All of us are dependent for our livelihood andprogress on the creativity and courage of theparticular men/ women who accept the risks whichgenerate our riches”.

Entrepreneurship and Economic Development

As Meier and Baldwin have put it, “Developmentdoes not occur spontaneously as a naturalconsequence when economic conditions are rightin some sense, a catalyst or agent is needed, andthis requires entrepreneurial activitiy”. In thiscontext, it may be noted that tourism as an industryhas taken off and is growing at an impressive rateall over the world. In the service industry, tourismproved to be a better bet, thanks to the variousvirtues like the need for low capital and easy toset up businesses.

Therefore, the scope for entrepreneurship isrelatively more in the tourism sector, given the widerange of services to be provided to the tourists,involves all commercial activities spread acrossthe whole spectrum of tourism and allied sectors.These include transportation, hotels and catering,travel agencies, tour operator, entertainment,production and marketing of works of arts andcrafts, conferences/events and exhibitions,management of parks and other recreation places.

Innovative Tourism Products - Key to FutureGrowth

TOURISM ENTREPRENEURSHIP : THRUST AREAS FOR ACTIONTOURISM ENTREPRENEURSHIP : THRUST AREAS FOR ACTIONTOURISM ENTREPRENEURSHIP : THRUST AREAS FOR ACTIONTOURISM ENTREPRENEURSHIP : THRUST AREAS FOR ACTIONTOURISM ENTREPRENEURSHIP : THRUST AREAS FOR ACTION

G. Anjaneya Swamy

The fact thati n n o v a t i v et o u r i s mproducts holdthe key for thesuccess andsustenance ofIndian tourismneeds no emphasis. Inspite of the widelyacclaimed benefits of tourism, the initiatives of thegovernment and developmental agencies to takeIndian tourism to the next level are far fromsatisfactory. Not many new tourism destinationsworth mentioning have been developed in the lastseveral decades. As a result, the pressure onthe existing tourism destinations is increasing bythe day with improvements in the road network,transport options, telecommunication facilities anda steep increase in the incomes of the tourismcustomers apart from the changes in the lifestylesand preferences. Therefore, it is high time thatnew product/ destination development is paidgreater attention now than before. Following aresome of the initiatives which may catapult Indiantourism into a new orbit.

Promotion of Unique / Mystery Sports

Unlike the west, where some unique spots whichdefy nature and logic are promoted vigorously,India is yet to identify its mystery spots and marketthem. For instance, Jatinga near Haflong in Assamwhere birds from far off countries arrive duringSeptember-November every year and hit aspecified ridge and commit suicide. It is a mysteryindeed! Similarly, a water pond in Mahanandi inKurnool district of Andhra Pradesh where thewater level is constant throughout the year. Thetank here is 1.5 m (5 ft.) deep. The mystery is thatno one knows how the water enters the tank- and that it is always the same level and crystalclear. The fact that water is so pure and clearwhere even a small coin also is very clearly visiblefrom the top further compounds the mystery.Another mystery spot worth mentioning could bethe Bhangarh Fort near Always in Rajasthan, saidto be one of the most haunted sites in the world.

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Yet another place is Shani Signapur in Maharashtrawhere the houses in the entire village are withoutdoors, leave alone locks. Legend goes that thereis a strong belief among the people there that ifanybody steals anything, he/she is severelypunished by the God. Too strange to believe inthe comtemporary society!

All these exciting and strange desitinatinations offertremendous potential from the tourism perspective.Exploitation of these resources calls forentrepreneurship. Product design, strengtheningaccessibility, accommodation and other touristfriendly facilities need to be put in place. All theseplaces which are known in the respective regionsmay be put on a larger canavas such that thecuriosity, mystery surrounding these places andthe folklore of these places offer Unique SellingPropositions (USP). Therefore, it is high time thatappropriate emphasis may be laid onunconventional tourism products like these areincluded in the National/State tourism policies.

Promotion of Less known Destinations

Given the size of the nation and the diversities,there are many attractions with a huge potentialwhich needs to be expoited and put across theNational Tourism Map. For instance, the Pulicatlake and the Bird Sanctuary in Nellore district ofAndhra Pradesh (150 km from Chennai), thescenic beauty of Muppanae in Karnataka with goodcamping facilities, Parambikulama Eco tourismspot abutting the famous Top Slip, Meghamalai inTheni district in TamilNadu - a haven for trekkersare just a few attractions which are second to none,though ironically are not known much in the tourismcircles, barring a few Special Interest Tourists.Similarly, Lambhasingi near Visakhapatnam inAndhra Pradesh is one place which receivessnowfall every year in the whole of South Indianeeds a special mention. It is obvious that thereare several places across the country awaitingthis kind of attention.

Accessible Tourism

It is an irony that compared to the products ofmanufacturing sector, the service sector, moreparticuclarly, the tourism sector is yet to realiseand appreciate the specific needs of the peoplewith disabilities. While nations and the variousproductive sectors all over the world are harpingon “Inclusive Growth” tirelessly, tourism sector

seems to be lagging behind with respect to theconcern for differently abled people. It may benoted that the urge to visit various places ofinterest, explore and experience the myriadvariations of nature are basic human instincts. Itis disheartening that the specific needs of a sizablesection of disabled people, whose number isestimated to be more than 600 million around theworld, are not taken cognizance of in an organisedfashion. Apart from meeting the social objectiveslike equity and social justice, the size of the markettruly provides enormous opportunities for newinvestment in terms of product design anddevelopment. According to European Network forAccessible Tourism (ENAT), accessible tourismincludes creation or modification of infrastructuralfacilities like: barrier free destination, hassle freetransport, high quality services, participation inactivities and exhibits, convenience in accessingand handling transactions with respect to bookingsystems and other service acquisition tasks.

Thanks to the internet, online travel planning andbooking have become more accessible to all thesegments. However, the facilities at travelterminals and the destinations leave much to bedesired.

Pro-Poor Tourism

Visiting places, meeting people, enjoying thescenic beauty and savouring different cuisines arenatural human instincts and are economic status,domicile, gender and age neutral. However,willingly or unwillingly, Indian tourism over theyears evolved itself to focus on the urban rich andelite. If the trend continues, no wonder it may soonbe described as, “Tourism of the elite, by the eliteand for the elite” !

Inspite of huge development in the tourisminfrastructure with respect to transpor t,accommodation and other services, vast sectionof the Indian society from the rural and semi-urbanplaces are still outside the tourism experience. Itis an irony that while products from manufacturingsector could effectively reach out to the ruralmarkets even in remote places, tourism as aproduct is yet to be promoted in an all inclusivefashion ! Nothing could better capture the potentialof rural and unexplored markets for tourism thanC.K. Prahalad’s popular theme, “Fortune at thebottom of the pyramid’! Therefore, it is high time

MAY-JUNE, 2015 13

that rural markets are expored. Change in theattitude, tourism product development at affordablecost, a warm welcome approach for involvementand participation of the rural folks are some of theissues to be addressed. Excepting some popularpilgrim centers across the country, all othertourism products are comparatively missing outon this huge rural tourism market.

Excursion/Tour Packages for Students

It is quite intriguing that no major tour operator/travel portal has any product in their product mixdesigned to suit the specific needs of students ofschools/colleges. It is anybody’s knowledge thatnow-a-days, almost all the education institutionsorganise short excursion trips/study tours/industryvisits. Given the size of the nation, number ofinstitutions and the growing enrollment of students,the size of the market is so huge and is waiting tobe tapped in an organised fashion. This market isusually served by bit players in the industry,largely from the unorganised sector and in anunprofessional way, quite often at the cost of thesafety and security of the students in their trips. Acase in point is the tragedy where 24 engineeringcollege students from Hyderabad lost their livesdue to sudden upsurge of water in the Beas riverlet out from Larji Hydro Electric Projectdownstream. Cases of cheating and exploitationare also not few and far between. The teacherswho plan with the help of student representativesmay not have the professional expertise to designthe tour schedules in terms of fool proof itineraries,cost effectiveness and contingency plans to meetunexpected events. As a result, stranded groupsof students at many bus and railway stations withdislocated schedules and stress ridden faces area common sight.

Man-made Tourism Resources

With thousands of kilometers of vast coastlineson both East and West, it is disheartening to notethat not much is heard about beach tourism.Excepting Goa on the west coast and Puri beachon the east coast in the country, we cannot boast

of beaches internationally known. Of course, thereare several beaches of different hues all along thecoast line, largely catering to the local/regionalmarkets. There is ample space and scope for thepromotion of atleast half a dozen world classbeach tourism destinations with less investment.Water sports are another tourism product whichis crying for attention.

Theme/Amusement parks

Theme and Amusement parks are manmadetourism attactions, though involving larger capitaloutlays which cater to the tourists of all ages andorientations. At the present pace, it is anybody’swonder as to how many years the nation will taketo have any theme park close to Disneyland,though not similar ! When Universal Studios ofUSA could fully leverage its Hollywood moorings,equally renowned in terms of history and spread,Mumbai Bollywood studios and studios in Chennaiand Hyderabad are yet to make significant strides.Any initiative in this regard will be an instant hitgiven the film crazy population. The role playedby Ramoji Film City in Hyderabad deserves allthe praise in this regard. Bombay and Chennaicould also leverage their film studios and rich filmheritage.

Time to Act

All these innovative business opportunities offertremendous potential from the tourism perspective.Exploitation of these resources depends on theentrepreneurial spirit and a culture that acceptstourists with open arms, true to the India spirit of“Atithi Devo Bhava”! Product design,strengthening accessibility, accommodation andother tourist friendly facilities need to bestreamlined/improved. Each place has its beautyand speciality which could be marketed. Identifyingthe Unique Selling Propositions (USP) is an artand is a function of entrepreneurial ingenuity.Therefore, it is high time that approriate emphasisis laid on unconventional tourism products and areincluded in the National/State tourism policies forpromotion and development.

The author is Senior Professor of Tourism in the School of Management of PondicherryCentral University. Dr. Swamy is also the coordinator of UGC-SAP: DRS Level II

program of the Deptt. of Tourism Studies. Dr. Swamy is a prolific writer onEntrepreneurship and allied issues and has a good number of research publications in

Indian and International Journals.

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LETTER TO THE EDITOR

Dated : 10/06/2015

Dear Editor,

I am glad to see that COSIDICI bi-monthly Magazine which gives cogentand interesting news regarding the current topics, News from States,Economic Scene, MSMEs, Infrastructure etc. is regularly coming outwith its informative issues. Moreover, the write-ups on successful unitsfinanced by SLFIs are very inspiring and thought provoking. All theissues are well covered and managed.

All the best to COSIDICI team for all their future endeavours.

Best regards,

Yours Sincerely,

Sd/-

(RAM SINGH PAL)

Indian Institute of Human Rights,A-15-17, Paryavaran Complex,

Maidangarhi Marg, New Delhi

A person goes towards any substance addiction becauseeither they are deprived of love; or crisis in life; or low selfesteem and seeking public approval for feeling good. Help

them to heal the pain in order to give up the addiction.

There are no secrets to success. It is the result ofpreparation, hard work, and learning from failure.

MAY-JUNE, 2015 15

WBIDC OFFERSWest Bengal attracts mettle:West Bengal industrial Development Corporation, acompany registered under the Company Act wasincorporated in 1967. It is the premier agency of theGovernment of West Bengal, administered by theCommerce & Industr ies Depar tment forconceptualizing, developing and facilitating growth ofindustry, investment and infrastructure in WestBengal. It provides support to industries through thefollowing four ways :

♦ Facilitation; ♦ Financing;

♦ Incentives and ♦ Industrial Parks.

WBIDC also plays an active role in assistingimplementation of new investments through ‘ ShilpaSathi ’ an integral part of the Corporation.

WBIDC- Responsibilities♦ Spearheading the promotion of West Bengal as

industry - friendly destination.

♦ Financing medium & large scale industriesthrough different loan schemes.

♦ Catalyzing business, trade and industrial linkswith domestic as well as foreign institutions,organisations and companies.

♦ Conceptualization of new projects as well asassistance to entrepreneurs towardsimplementation and follow-up.

♦ Disbursing Incentives to medium and largescale industries on behalf of the Governmentof West Bengal.

♦ Development of modern industry-specificIndustr ial Parks with state-of-the ar tinfrastructure.

♦ Dissemination of information related toprospects of industries in state.

WBIDC – Corporate Social Responsibility♦ Framing and implementing appropriate

Resettlement and Rehabilitation Package inconsultation with the stake holders.

♦ Organizes avenues of livelihood for projectAffected persons.

♦ Development of social infrastructure in theneighborhood of the project areas.

Hooghly Met Coke And Power Company Ltd.Hooghly Met Coke and Power Company Ltd(HMCPCL) is a joint venture between Tata Steel Ltd..(Tata Steel) and WBIDC. The company is setting upmerchant coke ovens unit adopting the heat recoveryroute at Haldia, West Bengal. The project is intended

PROFILE OF MEMBER CORPORAPROFILE OF MEMBER CORPORAPROFILE OF MEMBER CORPORAPROFILE OF MEMBER CORPORAPROFILE OF MEMBER CORPORATIONSTIONSTIONSTIONSTIONS

West Bengal Industrial Development Corporations (WBIDC)

etc.The unit would have an annual coke productioncapacity of 1.6 million tons. Excess heat produced inthe coke oven process will be utilized to produceelectricity. The power capacity would be around 120MW. Power generation would be done by Tata PowerCompany Ltd.

This new generation technology based on the heatrecovery process will have emission levels lower thanthose resulting from older, by-product coke oven typetechnology. The West Bengal State Pollution Controlboard and the Environment Ministry have alreadygiven an NOC to the project.Come 2008 the companyhopes to start its operations with complete supportfrom West Bengal Government, Ministry of Shipping,Haldia Dock Complex and Kolkata Port Trust. TheHaldia Development authority has agreed to extendevery infrastructural suppor t to ensure promptexecution of the project. The company plans to deriveits skilled and unskilled manpower from its operatingenvironment, giving a fillip to the industrial and localdevelopment at Haldia.The envisaged cost of theproject is around Rs.1150 crores.

Haldia Petrochemicals Ltd:Haldia Petrochemicals Ltd is a modern naphtha basedPetrochemical Complex located 125 kms fromKolkata, at Haldia, West Bengal, India.

It is jointly promoted by West Bengal IndustrialDevelopment Corporation, The Chatterjee Petrochem(Mauritius) Co. Ltd. and the Tata Group with aninvestment of $1.2 Billion.

Bengal Srei Infrastructure Development Limited(BSIDL)Bengal SREI Infrastructure Development Limited(BSIDL) a subsidiary of SREI Capital Markets Ltd.(SCML) was formed as a Joint Venture with WBIDCand commenced operations in early 2005 with an aimto facilitate the creation of infrastructure facilities inWest Bengal and act as a catalyst for sustainableeconomic development and industrialization of WestBengal.

Dr. Krishna Gupta, IASM.D., WBIDC

for sale of metallurgical cokein the international as well asdomestic market and alsosupply of coke to the blastfurnaces of Tata Steel atJamshedpur.

To produce world class lowash metallurgical coke, theentire coking coal requirementwill be imported from countriessuch as Australia, Canada,CIS countr ies, Indonesia

COSIDICI COURIER16

♦ Since soil is the basis for plant growth, itcontributes to the maintenance of both thenatural and planted landscape. It supportsthe forests, wetlands, jungles, prairies andgrasslands that spawn the planet’s amazingvegetative biodiversity. Those plants—someof which we are still discovering—providefood, fuel, animal feed, medicine and rawmaterials for clothing, household goods andother essentials. Plants in turn help preventsoil erosion.

♦ Soil also supports animal biodiversity, aboveand below ground. It’s essential to the livesof both wildlife and domesticated livestock.And the soil itself is teeming with afathomless number of micro-organisms andinsects as well as familiar organisms suchas earthworms that maintain soil quality,provide nutrients, break down toxic elementsand interact with water and air to helpmaintain a healthy natural environment.

♦ Soil is important in providing an adequatewater supply and maintaining its quality. Soiland the vegetation it supports catch anddistribute rainwater and play a key role inthe water cycle and supply. Soil distributioncan impact rivers, lakes and streams,changing their shape, size, capacity anddirection.

♦ The water absorption properties of soil play

DO YOU KNOW !DO YOU KNOW !DO YOU KNOW !DO YOU KNOW !DO YOU KNOW !

Healthy Soil is Vital to Human Life on Earth

a role inr e d u c i n gpollution fromchemicals inp e s t i c i d e sand othercompounds.

♦ Soil providesboth the foundation and base materials forbuildings, roads and other built infrastructure.

♦ Soil holds the key to Ear th’s history,containing and preserving artifacts of theplanet’s past, both its natural and its human/cultural antecedents. You can thank soil forthose dinosaur fossils every kid loves to seeat a natural history museum as well as therelics that tell us how our own human storyevolved.

♦ And critical to Earth’s future, soils and howwe use them play an important role in helpingus to address climate change. Soil organicmatter is one of our major pools of carbon,capable of acting as either a source or sink.Soil contains the fossil fuels that drive climatechange when extracted but when leftunderground give us the chance to reducethe greenhouse gas emissions that driveclimate change and reach our eventual goalof a zero-emissions world.

Our thoughts and words should be in harmony when wegive our opinion to others. If we create a negative thoughtand speak sweet words, it is conflicting energy. Convert

at the level of thoughts, not words, this is integrity.

MAY-JUNE, 2015 17

29 industrial areas of Delhi to be brought undersingle body

Delhi Industries Minister, Shri Satyender Jain inJune 2015 said all 29 industrial areas of the capitalwould be brought under an umbrella body within ayear and provided essential infrastructure forsmooth manufacturing and production.Government has planned to bring up two fullydeveloped industrial areas in Bakrola and RaniKhera.

“There should be a single agency. All industryareas would be brought under the Delhi StateIndustrial and Infrastructure DevelopmentCorporation (DSIIDC) within a year...two majorindustrial areas would come up at Bakrola andRani Khera with all the adequate infrastructureunlike the existing ones,” he said. The 22 non-conforming industrial areas”, languishing due topoor infrastructure, would be “authorised” by thegovernment by working with concerned agencies.

Kundli-Manesar-Palwal Expressway to becompleted by 2016

Haryana Chief Minister, Shri Manohar Lal Khattarin June, 2015 outlined the various initiatives forbetter transportation network in the state, includingmore intra-city bus services, fully automatedvehicle inspection centres among others.

Speaking at the 35th meeting of National CapitalRegion Planning Board (NCRPB) Shri Khattar saidthat the Kundli-Manesar-Palwal Expressway willbe completed before March 2016. He informedthat Haryana State Industrial and InfrastructuralDevelopment

Corporation (HSIIDC) is the nodal agency toimplement the project. The state government,through HSIIDC, has recently submitted a proposalto NCRPB for seeking financial assistance to thetune of Rs.457.81 crore.

Punjab to bring one-time settlement policy forsick units

The Punjab government will introduce one-timesettlement (OTS) policy in the state, with a view

MEMBER CORPORAMEMBER CORPORAMEMBER CORPORAMEMBER CORPORAMEMBER CORPORATIONS - THEIR ACTIVITIESTIONS - THEIR ACTIVITIESTIONS - THEIR ACTIVITIESTIONS - THEIR ACTIVITIESTIONS - THEIR ACTIVITIES

to bring theblocked industrialinvestment intoproductive useand to revive thestate industry. Thepolicy wouldprovide the much-needed relief tothose industrialunits that raisedloans from the state-level financial institutions suchas Punjab State Industrial DevelopmentCorporation (PSIDC), Punjab FinancialCorporation (PFC) and Punjab Agro IndustriesCorporation (PAIC) but had gone into losses, eitherbecause of recession or poor demand.

Under the policy, besides hundreds of small-scaleindustrial units, 60 large- and medium-scaleindustrial projects as well as 15 industrial projectsof PAIC are likely to get revived and PFC, PSIDCand PAIC are expected to effect recovery ofsignificant public money.

A senior official in the industry department saidthis was an effort to give relief to sick units andrevive them. Under the scheme, the state-levelfinancial institutions would rehabilitate the sickunits through OTS.

Earlier, PFC waived off loans of 782 units underthe OTS scheme and settled Rs 900 crore onaccount of interest and penal interest duringJanuary 1, 2010 to December 31, 2014. ThePSIDC is an institutional promoter, theorganisation’s aim is to promote infrastructure andindustrial development in the state wherein it hadinvested in the equity in the various public, joint,assisted and private sector units. PFC is aninstitution of state which was incorporated toperform the role of a development bank in the state.The corporation was established with an objectiveof granting loans to establish new industrialconcerns, modernisation and expansion/diversification of existing activities, among others.PAIC is entrusted with the responsibility of

COSIDICI COURIER18

promotion and facilitation of agro-based industries,including agro-processing, dairy processing andpoultry processing, agro residue processing, food& horticulture processing and agro chemicalsmanufacturing

KSIDC gives Rs 1.75 crore to Kerala Govt.

State public sector unit Kerala State IndustrialDevelopment Corporation (KSIDC) on June 06,2015 handed over a cheque for Rs.1.75 crore tothe state government as its profit share for thefiscal 2013-14. For the past eight years, KSIDChas been consistently paying out dividend to thestate government. In the financial year 2013-14,KSIDC sanctioned projects involving a capitalinvestment of Rs.152.38 crore with direct term loanassistance of Rs.54 crore and share capitalassistance of 18.37 crore. The new project isexpected to generate employment for 1,000persons directly or indirectly. The Corporation hasalso registered Rs 60 crore in disbursement anda record of Rs.101 crore in recovery for 2013-14.The income has come to Rs.53.48 crore during2013-14 and the profit was 30.49 crore. KSIDChas diversified its activities to create infrastructurefor various industries in the state. Besidesdevelopment of basic facilities at Industrial GrowthCentres, KSIDC is actively involved in thedevelopment of Life Sciences Park, BusinessIncubation Centres, Light Engineering IndustrialPark, Electronic hubs, Women’s entrepreneurialand Youth’s entrepreneurship activities.

Tamil Nadu to come up with new aerospacepolicy to attract investments

TamilNadu is set to come out with a new policy toattract aerospace manufacturing industries to thestate. The state has managed to attract aroundRs.1,500 crore for the upcoming aerospacecomponents manufacturing park, which will spreadover 250 acres at Sriperumbudur near Chennai.

Speaking on the sidelines of the 6th edition of TamilNadu Manufacturing Summit, Shri B. Elangovan,general manager of Tamil Nadu IndustrialDevelopment Corporation (Tidco) said the statewished to create a complete ecosystem andinfrastructure to attract investments in this sectorbesides introducing a new policy. “In ten years

from now, we want to manufacture aircraft in thestate,” said Shri Elangovan. He said the state hadto compete with Karnataka, which has a strongpresence in the aerospace industry. Bangalore-Chennai- Hyderabad is considered as theaerospace hub in India with its strong ecosystemin place for attracting investments. Tamil Naduhas made plans for setting up a maintenance, repairand overhaul (MRO) facility spread in 50 acres inMeenambakkam. “The TEFS study was completedfor creating aeroparks in multiple locations in thestate and an exclusive policy is on the anvil foraerospace industries,” he said.

TIDCO is expecting major Original EquipmentManufacturers (OEMs) and more than 50companies to set up shops in the park by 2015-end. These companies are largely SMEs and thepark will have a design centre, common testingand training facilities, aero complex, centre ofexcellence, warehouse and compositedevelopment centres.

SICOM to float two funds to revive capitalmarket biz

SICOM, is set to revive its capital marketoperations by launching two funds that would investin real estate projects and businesses withstressed balance sheets. The two funds wouldmobilise over Rs.1,000 crore as initial capital, andthe pool would be used to cut collateralised creditdeals at rates of 14-18%. “We intend to pool in thefunds from private equity funds and other financialservices institutions,” said Shri Ashish KumarSinha, managing director, SICOM. “The specialsituations fund would invest in well-managedcompanies that are undergoing temporary financialstress. We’ll also lend to companies that do nothave enough growth capital”. SICOM is hoping toget its AIF (alternative investment fund) licencefrom Sebi in three-four months.

The NBFC is talking to several prospectiveinstitutions to participate in the two funds. StateIndustrial and Investment Corporation ofMaharashtra, or SICOM, was established in 1966by the Maharashtra government with the objectiveof industrialising backward areas in the State.

MAY-JUNE, 2015 19

Govt. notifies framework for revival,rehabilitation of MSMEs

The government on May 29, 2015 notified aframework for MSME revival and rehabilitation. Theframeworks key features are identification ofincipient stress; formation of committees by Banksand for distressed MSMEs; and a CorrectiveAction Plan by the Committee. Before a MSMEloan account turns into a Non Performing Asset(NPA), banks/creditors are required to identifyincipient stress in the account.

An MSME may also voluntarily initiate proceedingsif it apprehends failure of its business or its inabilityto pay debts and before the accumulated lossesof the enterprise equals to half or more of its entirenet worth. Banks shall set up one or morecommittees to provide reasonable access to alleligible MSMEs which have availed of creditfacilities from the bank. Under the CorrectiveAction Plan (CAP), the Committee may explorevarious options to resolve the stress in theaccount. “The options may include: rectification—regularize the account to prevent it from becomingNPA; restructuring the account if it is prima facieviable and the borrowers is not a willful defaulter;and, if both these options not feasible, thenrecovery. During the CAP operation period, theenterprise shall be allowed to avail of secured andunsecured credit.

Google India aims to get 20 million IndianSMEs online by 2017

Google India has launched a nationwide initiativeto help small medium businesses to go digital andget an online presence on Google search andGoogle maps, without having to invest in a website

MICRO, SMALL & MEDIUM ENTERPRISES (MSMEMICRO, SMALL & MEDIUM ENTERPRISES (MSMEMICRO, SMALL & MEDIUM ENTERPRISES (MSMEMICRO, SMALL & MEDIUM ENTERPRISES (MSMEMICRO, SMALL & MEDIUM ENTERPRISES (MSMEsssss)))))

or domain. Google India will get 20 million SMEsonline by 2017 by using a mobile app, ‘Google MyBusiness’, which will help businesses to createand manage their business information acrossGoogle products for free in Hindi and English.

West Bengal govt to invest Rs.26k crore toboost MSME, textile sectors

West Bengal Chief Minister Ms. Mamata Banerjeehas said that the Bengal government had initiateda plan to invest over Rs.26,000 crore fordeveloping the MSME and Textile sector. She alsosaid that a separate textile policy of state was beingformulated. Under the plan MSME projects wouldbe set up in joint ventures or through PPP.

Delhi exporters’ body seeks clear policy onsmall units

Delhi Exporters Association has requested thegovernment to formulate a “clear cut” policy forMSMEs and the cottage industry to help boostexports. “Main cause for export decline is the lackof confidence amongst foreign buyers in India’sability to supply products on time and at properquality and price,” it said. High transaction costand interest rates for exporters too are responsiblefor declining exports.

The intention should be reformation not punishment. Angergives punishment, depletes the energy of the one who has madea mistake. Love empowers them and brings about reformation.

COSIDICI COURIER20

ANDHRA PRADESH

Andhra govt clears Rs.2003-cr projects

The Andhra Pradesh government has clearedseven projects that would need investments to thetune of Rs.2,003 crore and would likely create35,700 jobs in the state, a review meeting by theState Investment Promotion Board (SIPB) said.Chief minister Shri N Chandrababu Naidu askedthe industries department at the meeting to givemonthly updates on the status of the projects. “TheEconomic Development Board was asked toprepare feasibility reports of projects”.

JAMMU & KASHMIR

Centre to give J&K another Rs.2,473 crore

The Centre will release Rs.2,437 crore to theJammu & Kashmir government this year, takingthe total relief package to the flood ravaged stateto more than Rs.5,000 crore, besides working ona long-term development plan for the state, homeminister Shri Rajnath Singh and financeminister Shri Arun Jaitley said on 16th June, 2015.NITI Aayog CEO Shri Sindhushree Khullarand Secretary, Expenditure, Shri Ratan P Watalwill visit J&K to develop a longterm vision for thedevelopment of the state, and their suggestionswill be considered by the government in thatrespect. The larger plan regarding developmentof infrastructure in power, highways, health, HRD,water resources, tourism, textile and educationsectors will be rolled out after suggestions fromthem.

GUJARAT

Gujarat companies queue up to get listed onSME bourse

With easier listing rules and significantly smootherregulatory mechanism, many small and mediumenterprises (SMEs) have are listing on the SMEexchange of the BSE. At present, 94 companiesare listed on the SME bourse and about 32companies, most of which are located in Gujarat,are in queue to get listed.

NEWS FROM STNEWS FROM STNEWS FROM STNEWS FROM STNEWS FROM STAAAAATESTESTESTESTES

“Out of the total 32 companies, which have filedDraft Red Herring Prospectus (DRHP) with BSESME exchange, 12 are from Gujarat, representingmore than 37 per cent of the companies who havemade recent filings,” said Shri Mahavir Lunawat,managing director, Pantomath CapitalAdvisors Private Limited.

Earlier this month, a BSE SME official said theexchange is targeting to list about 100 companiesby the end of current financial year. Recently, BSESME Exchange had revised the listing normsthereby requiring higher post-issue paid-up capitalat Rs.3 crore against the previous requirement ofRs.1 crore. Also, now the net worth requirementand tangible assets requirement has beenincreased to Rs.3 crore from Rs.1 crore.

Similar platform on the National Stock Exchange(NSE) named Emerge, however, has receivedlukewarm response from SMEs. So far, only sevencompanies have been listed on NSE Emergesince its inception. The market-capitalisation ofthe BSE SME platform is Rs 7,819 crore, as onJune 15. The total market capitalisation of NSEEmerge is Rs 430 crore.

TELANGANA

Telangana unveils industrial policy

The Telangana government unveiled its newindustrial policy on 12th June, 2015 which focuseson time-bound approvals for setting up projects inthe State. Telangana Chief Minister Shri KChandrashekar Rao said his office would have a“chasing cell” to monitor the progress of various

MAY-JUNE, 2015 21

proposals, while presenting the features of thepolicy.

According to the new policy Telangana StateIndustrial Project Approval and Self-certificationSystem (TS-iPASS), penal action will be takenagainst government officials if there is any unduedelay in processing applications, the CM said,adding that mega projects would get permissionsin 15 days. The industrial policy framework, whichwas passed in the Telangana Assembly inNovember 2014, had promised to offer minimuminspection and maximum facilitation.

The policy prescribed norms for giving permissionsto mega (investments of Rs.200 crore and above),large (Rs.10 crore-Rs.200 crore) as well as smalland medium project proposals. The governmentidentified 14 core areas for a focused approachwhich include life sciences, pharma, informationtechnology, aerospace, automobiles, textiles,minerals and transportation and logistics, amongothers. The CM also launched a solar power policywhich will ensure single window clearances tosolar projects.

100 smart cities to be developed in states

Of the 100 proposed smart cities across statesand Union territories, 20 would be selected thisfinancial year, it is learnt. The rest would join theclub in two batches of 40 each in the next twoyears, said a source in the government. Oncethe entire smart-city plan is rolled out across thecountry, Uttar Pradesh will account for the most(13), followed by Tamil Nadu (12), Maharashtra(10), Madhya Pradesh (seven), and Gujarat andKarnataka (six each). Though the timeline hadn’tbeen defined, the entire exercise of making 100cities ‘smart’ could take a decade or more.

Among those that could be part of the 100 smartcity list are Lucknow, Allahabad and Varanasi inUP; Chennai, Coimbatore and Madurai in TamilNadu; Ahmedabad, Gandhi Nagar, Surat andRajkot in Gujarat; Amritsar, Ludhiana andJalandhar in Punjab; Gurgaon and Faridabad inHaryana; Shimla in Himachal Pradesh; andHaridwar and Roorkee in Uttarakhand.

While the Union Cabinet had cleared centralfunding of Rs.100 crore per city, per year througha period of five years in April, Prime Minister Shri Narendra Modi is scheduled to announce the finerdetails later. He will also provide the details of theAtal Mission for Rejuvenation and UrbanTransformation (AMRUT). A combined funding ofRs.1 lakh crore was cleared for 100 smart cities,as well as for the rejuvenation of 500 others.

Selection of potential smart-city candidates will bebased on a two-stage competition called ‘citychallenge’. While states will first compete to nametheir cities, the second stage will be about citiesmaking the cut. The evaluation of cities and townswill be based on criteria framed by the Ministry ofUrban Development, in consultation with states.The Centre has mandated every state be made apart of the smart-city universe.

MANIPUR

Rs.3,950.92-crore Manipur budget presented

Manipur Chief Minister Shri Okram Ibobi Singh,who also holds the finance portfolio, presented theRs.3,950.92 crore budget for the current financialyear in the assembly on 26th June, 2015.According to a press note issued by thegovernment, the chief minister said that a fullbudget could not be presented as the plan size for2015-16 was yet to be finalised.

When someone has made a mistake, they are in pain. We feelthey have done wrong, and we are in pain because of theirmistake. Truth is they are in more pain than anyone else.

COSIDICI COURIER22

JICA drawing up plan for Chennai-Bengalurucorridor: Govt.

The Government has assigned the JapanInternational Co-operation Agency (Jica) to preparea comprehensive plan for selected industrial areasalong the Chennai-Bengaluru Industrial Corridor,commerce and industry minister Ms. NirmalaSitharaman said.

Govt mulling proposals for urgent measuresto perk up exports

With shipment shrinking in April, 2015 for the fifthconsecutive month, the commerce ministry hasbegun an analysis of the merchandise exports andis evaluating proposals for urgent interim supportto perk up growth and prevent job losses. Thestudy will initially cover five sectors that had asignificant share in the country’s export basketlast fiscal — engineering (accounting for 23% oftotal exports), pharma (5% including bulk drugs,drug intermediates, drug formulations andbiologicals), petroleum (18.33%), farm products(12.6% including agriculture and allied products,plantation, marine and cotton), gems and jewellery(13.3%).

To improve data base of the merchandise exports,the ministry will hold a meeting shortly withDirectorate General of Commercial Intelligenceand Statistics (DGCIS), customs department,NSDL Database Management (which helps incollection of data from special economic zones)and the think tank ICRIER (helping DGCIS withonline surveys to collect services exports data).Issues that will be discussed include linking allports to the electronic data interchange systemfor faster and better capturing of data. Close tohalf of the around 220 ports in the country are yetto be EDI-linked, leading to delays in data collectionand assessment.

Interim measures being suggested for certainaffected sectors include raising the duty creditscrip benefits under the Merchandise ExportsFrom India Scheme and increasing the duty

ECONOMIC SCENEECONOMIC SCENEECONOMIC SCENEECONOMIC SCENEECONOMIC SCENE

drawback rates.Also beingconsidered arereintroduction ofthe 3% interests u b v e n t i o nscheme (for allsectors) andenhancement ofthe scope of the Market Access Initiative scheme(for marketing projects, capacity building, supportfor statutory compliance, studies and projectdevelopment). Citing a decline in order bookingposition in April, exporters had warned that if thetrend continues for the next six months, there couldbe shedding of workforce.

Another sector the ministry is keen on giving apush is project goods which currently areperforming far below potential. Exports from thesector last fiscal were just $41 million (that too, an11% contraction). The ministry has askedagencies such as DGCIS to devise a bettermethod of data collection on project exports. Thegovernment is keen on boosting project exports(through better credit access to interestedcompanies via special lines of credit and Buyers’Credit Scheme) especially in markets in Africa,Asia, Latin America, Caribbean region and non-EU countries in Europe with major infrastructureneeds.

GST threshold set at Rs.10 lakh

Traders with a turnover below Rs.10 lakh a yearwon’t have to register for or pay the goods andservices tax (GST), and those with annual salesof Rs.10 lakh to Rs.50 lakh will need to pay thetax at a rate lower rate than the standard GSTrate.

The concessional tax rate would, however, not beavailable for traders making interstate transactionsirrespective of their turnover. The quantum ofconcession will be decided by the proposed GSTCouncil which will also determine the standardGST rate. The threshold levels were finalised by

MAY-JUNE, 2015 23

the empowered committee of state financeministers that met at Thiruvananthapuram in May2015.

For northeastern states, the threshold could beRs.5 lakh. The proposed minimum turnover levelsfor GST to kick in would mean two things:Thousands of small traders with annual salesbelow Rs.10 lakh would go out of the tax net (inmany states the VAT threshold is Rs.5 lakh andbelow, though in others it is Rs.10 lakh and above.)Some tiny units will come under the tax net giventhat the central excise duty is now payable onlyfor units with Rs.1.5 crore turnover.

Experts said keeping the turnover threshold forGST as low as Rs.10 lakh would be a problem forsmall businesses given the compliancerequirement and use of sophisticated IT networkin tax payment and claiming of credits that smalltraders may not be equipped for. “In any taxregime, 80-90% of revenue would come from thelimited number of leading assessees, while theadministrative cost would far outweigh the revenuefrom small taxpayers”.

Exports plunge 20.19% in May; down for sixthmonth

Exports declined 20.19% in May to $22.35 billion,the sixth consecutive month of contraction, owingto a softening of crude oil, metal and othercommodity prices, besides weak demand in majoroverseas markets such as China, the Opec andeuro zone, a relatively stronger rupee anddomestic bottlenecks. Reflecting the underlyingweakness in the domestic manufacturing sectorand tepid domestic demand, imports shrank16.52% in May. This resulted in a trade deficit of$10.4 billion.

ADB to raise annual lending to India by 50%

The Asian Development Bank would step upannual lending to India by 50% to $3-4 billion during2016 to 2018 from $2-3 billion now, its presidentShri Takehiko Nakao said on 16th June, 2015.

“In India, ADB aims at increasing its sovereignand non-sovereign lending from the present $7billion-$9 billion in three years from 2015 to 2017

to $10 billion-$12 billion between 2016 and 2018using ADB’s expanded lending capacity,” said ShriNakao. ADB’s annual lending capacity is expectedto increase to about $20 billion a year from thecurrent level of $13 billion based on the merger ofits Asian Development Fund lending operationswith its Ordinary Capital Resources balance sheet.The bank’s latest economic outlook for Indiapublished in March projects GDP to grow 7.8% inFY16 (from 7.3% in FY15), rising to 8.2% in FY17.It is expected to revise its growth projections forthe current fiscal in July. The strong growth outlookwas backed by good macroeconomic indicatorssuch as a decline in inflation and the currentaccount deficit, and reforms to further open upcertain sectors for foreign direct investment andreduce fuel subsidies. Effor ts to expediteclearances for crucial infrastructure projectswould also sustain the growth momentum.

Mr. Nakao expressed strong support for reformsin the labor market as well as the proposed newgoods and services tax. He also laudedgovernment’s effort to boost public spending. “Thestrong commitment in the budget to raising publicinvestment by 25% in critical infrastructure sectorssuch as roads, railways, and urban developmentwill fur ther crowd in much-needed privateinvestment,” he said. India is the largest borrowerfrom ADB. Since 1986, ADB has approved 189sovereign loans to India totaling $31.3 billion. It hasalso approved 50 non-sovereign loans, equityinvestments, and guarantees totaling $3.6 billion.

Industrial production rose 4.1% in Apr

India’s industrial output grew 4.1 per cent in April,compared with 2.5 per cent in March.The recoverywas mainly on account of a surge in themanufacturing sector. In April, the rate ofmanufacturing growth rose to 5.1 per cent, againstthe previous month’s 2.8 per cent.

Of the total expansion of 4.1 per cent, 3.85percentage points were accounted for by themanufacturing sector alone. Manufacturing growthzoomed due to a surge in capital goods productionto 11.1 per cent, compared with 8.6 per cent inMarch.

COSIDICI COURIER24

Centre targets $47.5-billion textile exports in2015-16

The government has set the textile and clothingexport target at $47.5 billion for the current fiscal,aiming for an almost 14% rise in outboundshipments from the actual level of 2014-15. “Theachhe din for the textile sector has started toarrive,” textile minister Shri Santosh KumarGangwar said. The country’s overall textile andgarment exports grew roughly 5% in the last fiscalto $41.4 billion from a year before. Still, the exportsfell short of the official target of $45 billion for 2014-15. Earlier, quick estimates had showed that theexports during the April-February period went upby nearly 2% from a year before. The textileministry has sought a quick resolution of the India-EU free trade agreement, which would pave theway for duty-free access of Indian textile andgarment items to the EU, which account for morethan a third of the country’s garment exports.

The ministry has asked for continuation of theinterest subvention scheme, which was withdrawnfrom late 2014, to boost expor ts. Industryexecutives say under the scheme, certainsegments like the SMEs, handlooms, handicraftsand garments, were entitled to a 3% interestsubvention on export credit. Currently domestictextile exporters are given a 2% export incentivefor outbound shipments only to the US, the EU,Canada and Japan — the markets where theapetite is far more for garments than for textiles.The industry wants certain incentives to capturemarkets in countries such as Bangladesh, Vietnamand Cambodia.

Tax sops, other incentives proposed to booste-transactions

To discourage transactions in cash and therebycurb black money, the government is consideringgiving incentives to electronic transactions in theform of tax rebates, waiver of charges on cardpayments such as purchase of rail tickets anddiscounts on utility bill payments.

The finance ministry on 17th June 2015 put up thedraft proposals for facilitating electronictransactions as under :-

♦ Removal of convenience fee/servicecharge/surcharge levied on card paymentsfor essential services

♦ Discount by utility service providers to usersfor small ticket payments through e-channel

♦ Creation of acceptance infrastructure forcollections of revenue, fee and penalties

♦ Reduction in fees charged to a merchant bybanks for providing debit and credit cardservices

♦ Rationalization of fee on debit/credit cardtransactions

♦ Tax rebate to merchants as well asconsumers

♦ Approval for non-banks to install white-labelpoint of sales terminals.

Finmin sets up two panels for rollout of GSTfrom April 2016

Gearing up to roll out GST from April 1, 2016,the Finance Ministry on 17th June, 2015 set up twocommittees to suggest tax rates and look into ITpreparedness for the new indirect tax regime. Thecommittee formed under the Finance Ministry’sChief Economic Advisor would “recommendpossible tax rates under GST that would beconsistent with the present level of revenuecollection of Centre and States.” While makingrecommendations, it would take into accountexpected levels of growth of economy, differentlevels of compliance and broadening of tax baseunder Goods and Services Tax (GST).“TheCommittee would also analyse the sector-wise andstate-wise impact of GST on the economy and isexpected to give its report within two months.” TheSteering Committee has been formed under theCo-Chairmanship of Additional Secretary ofRevenue Department and Member Secretary ofEmpowered Committee (EC) of State FinanceMinisters. The panel has members from RevenueDepartment, Central Board of Excise andCustoms, Goods and Services Tax Network(GSTN) and representatives of stategovernments.

MAY-JUNE, 2015 25

Govts plans 500 incubation centres forprofessionals

The Centre plans to set up 500 incubation centreson the Public-Private Partnership model acrossthe country in the next one year to create moreskilled professionals, Minister of State for Micro,Small and Medium Enterprises (MSME) Shri GirirajSingh said in Coimbatore on 5th June, 2015.“Though 65 % of the Indian population is below 35years of age, only 2% of them are skilled. Theseincubation centres will provide technical knowledgeto them to make them skilled professionals orentrepreneurs”.

Forex reserves rise to $352.71 bn

India’s foreign exchange reserves stood at$352.71 billion as of June 5, which had touched$354 billion on May 15. Forex reserves increasedfor the second straight week after falling by $2.3billion in the week ended May 22.

The reserves are up $40.13 billion from a yearago and had a record quarterly accretion of $30.1during January-March.

Indirect tax collections up 37% in May

Indirect tax collections increased by 37.3 per centin May, leading to a 39.2 per cent rise in the firsttwo months of the current financial year over ayear before. This would help the Centre containits fiscal deficit at 3.9 per cent of the country’sgross domestic product in the current financialyear.

It appears the sharp surge in April was due to a100-plus per cent rise in excise duty collection,fuelled mainly by the increase in rates onpetroleum. And, the good indirect collection for Maywas on account of the additional cess on dieseland petrol, as well as the clean energy cess.

Manufacturing PMI at 4-month high in May

Manufacturing activities in May grew at the fastestpace in four months, showed the HSBCPurchasing Managers’ Index (PMI).

Manufacturing PMI rose to 52.6 points in May from51.3 in April. This was the highest PMI reading in

2015, but for January’s 52.9. A PMI reading above50 shows expansion, while one below thatindicates contraction.

Gross domestic product (GDP) figures in Juneshowed that manufacturing activity rose 7.1 percent in 2014-15, against 5.3 per cent in 2013-14.The outlook for 2015-16 remained uncertain asApril data showed moderation in manufacturinggrowth compared with March, and May showedhigh growth recovery somewhat. Manufacturersdid not hire additional hands due to the uncertaintyof continuing growth.

The sharpest rise in manufacturing output wasreported by producers of consumer goods. PMIdata was not in sync with the Index of IndustrialProduction, which continued to show weaknessin consumer goods, particularly durables. PMI alsoshowed an increase in capital and intermediategoods’ production. The higher output was due toimproved demand from domestic and foreignmarkets.

Economy grows 7.3% in FY15, industry beatsexpectations

India’s gross domestic product (GDP) grew 7.3per cent in 2014-15, slightly less than the advanceestimate of 7.4 per cent. The growth is based ona new methodology of calculating GDP, with 2011-12 as the base year, against 2004-05 used earlier.According to this methodology, the economyexpanded 6.9 per cent in 2013-14 and 5.1 per centin 2012-13.

India’s growth in 2014-15 was a little lower thanChina’s 7.4 per cent (for 2014). At 7.5 per cent,India’s growth in the quarter ended March thisyear, however, was higher than China’s seven percent. The growth in the March quarter was in linewith the advance estimates and the highest amonglarge economies. Data for the previous quarters,released by the Central Statistics Office on 29th

May, 2015, saw major revisions. GDP growth forthe first quarter stood at 6.7 per cent, against theearlier estimate of 6.5 per cent; growth for thesecond quarter was revised to 8.4 per cent from8.2 per cent. GDP growth for the third quarter,earlier estimated at 7.5 per cent, was revised to

COSIDICI COURIER26

6.6 per cent. As such, economic growth in thesecond half of the year slowed to seven per centfrom 7.6 per cent in the first.

In 2014-15, agriculture and allied sectorsregistered growth of only 0.2 per cent, against theadvance estimate of 1.1 per cent, owing to a sub-normal monsoon and unseasonal rain. Agriculturehad recorded 3.7 per cent growth in 2013-14. Inthe third and four th quar ters, farm sectorproduction fell 1.1 per cent and 1.4 per cent,respectively. Growth in industrial projection wasbetter than projected in the advance estimates. Itstood at 4.8 per cent, against the estimate of 4.5per cent. The manufacturing segment grew 7.1 percent in 2014-15, against the advance estimate of6.8 per cent.

National Industrial Corridor DevelopmentAuthority on anvil

The Central government is giving shape to aNational Industrial Corridor Development Authority(NICDA), to consolidate the financing and toexpedite the massive work on the economiccorridors.

The body will have a financial corpus of Rs.19,000crore and it will be headed by a CEO. It will also

be entrusted with the work of planning anddesigning of the corridors. The government hasso far conceptualised five economic corridors:Delhi-Mumbai Industrial Corridor (DMIC),Bengaluru- Mumbai Economic Corridor (BMEC),Chennai-Bengaluru Industrial Corridor (CBIC),Visakhapatnam-Chennai Industrial Corridor(VCIC) and Amritsar-Kolkata Industrial Corridor(AKIC). According to the plan, out of theRs.19,000-crore corpus, around Rs.2,000 crorewill be allowed for four industrial corridors and therest will be set aside for DMIC. Except for thefunding part, the DMIC will not be administered bythe NICDA. The body’s main function will beplanning and designing of the other four corridorsin terms of creation of investment zones, specialeconomic zones and industrial parks.

The DMIC covers six states including, UttarPradesh, Haryana, Rajasthan, Madhya Pradesh,Gujarat and Maharashtra. BMEC will coverKarnataka and Maharashtra, while the CBIC isexpected to cover Tamil Nadu, Karnataka andAndhra Pradesh. On the other hand, the VCICplans to include only Andhra Pradesh and TamilNadu. Lastly, the AKIC is expected to run thoughseven states - Punjab, Haryana, Uttar Pradesh,Uttarakhand, Bihar, Jharkhand and West Bengal.

Our thoughts and feelings create our energy field. Thisenergy field has an effect on our body, on people, on

nature and on matter. Our consciousness vibrates intothe universe.

If our energy field is pure and powerful everyone will gettouched with our pure vibrations. This will help them to

emerge their own purity and power. This is the truemeaning of blessing people.

MAY-JUNE, 2015 27

Executive Committee Meeting of COSIDICI:

The Executive Committee Meeting of COSIDICIwas held on June 19, 2015 at “India InternationalCentre”, New Delhi and was well attended by theMember Corporations.

Strengthening of Training Programmes forOfficers of SLFIs :

The members felt that to provide a wider spectrumand help in further upgradation of the skills andknowledge of the officers of SLFIs, COSIDICI mayalso organize training programmes. There was apool of talent in the Corporations with officers whowere specialists in their field and had a wide rangeof experience. These officers could provide veryuseful training and insights into the working of theSLFIs. It was decided that each trainingprogramme could be on one topic of interest viz.Strengthening of Loan Recovery, Revival ofCorporations, Financial and organizationalrestructuring.

The members felt that the first training programmecould be on Strengthening of Loan Recovery.Haryana Financial Corporation had launchedmany schemes for recovery which had been quitesuccessful. The Corporation had now decided tosell those units where recovery had not beenpossible and for this the Corporation would takethe help of various ARCs in the country includingthe ARC promoted by SIDBI viz. ISARC. Themembers suggested that Haryana FinancialCorporation could recover loans u/s 32G of theSFCs Act i.e. as arrears of land revenue. TheExecutive Committee was informed the recoveryof DFC had been facilitated under this sectionsince the hon’ble Supreme Court had ruled thatthe Managing Director or any designated officerof an SFC can act as” competent authority” interms of Section 32G of The SFCs Act, 1951 forrecovery of dues as arrears of land revenue. OtherCorporations like MPFC, BSFC, WBFC are alsousing this section effectively. The StateGovernment of Madhya Pradesh had bought allthe NPAs of MPFC thus cleaning its balance sheet.Now MPFC is recovering on behalf of the State

ACTIVITIES OF COSIDICIACTIVITIES OF COSIDICIACTIVITIES OF COSIDICIACTIVITIES OF COSIDICIACTIVITIES OF COSIDICI

Government andhas alreadyrecovered 60% ofthe totaloutstanding. Theexpenses involvedare debited to theState Government.HFC had foundsection 31 of SFCsAct very useful andhad settled cases under it within six months. Theprovisions of SARFESAI Act were also found tobe very useful by the SFCs. However, it couldnot be used in rural areas in case of agriculturalland.

Financial Restructuring and Revitalisation ofSFCs :

Shri P. Joy Oommen, CMD, KFC informed theExecutive Committee that the CGTSME schemewas a very useful mechanism for risk mitigationwhile providing financial assistance to new/grass-root entrepreneurs. However, only 2 or 3 SFCswere given permission viz. APSFC, TIIC &KFC.SIDBI had stopped coverage of loans underCGTSME when KFC reached the mark of Rs.25crore. Later on, the scheme was changed and theState Governments were requested to contributeRs.100 crore to the corpus of CGTSMEwhereafter the credit guarantee cover would be10 times of the contribution. In order to avail of thescheme, KFC had initially contributed Rs.10 croreto the corpus with CGTSME. But later on, StateGovernment Guarantee was made mandatorymaking the Scheme not feasible. Hence, KFC hadwithdrawn its contribution.

KFC was also the nodal agency of Kerala State’sKSEDM scheme under which it had alreadyhelped 1400 entrepreneurs in setting up theirprojects. Recognising the success of the scheme,the State Finance Minister had raised the upperlimit of soft loans from Rs.4 lakhs to Rs.7 lakhsfor an entrepreneur and from Rs.10 lakhs to Rs.15lakhs for technocrats. For groups (more than oneentrepreneur) it was fixed at Rs.20 lakhs. KFC

COSIDICI COURIER28

also provided training to the loanees thusincreasing the chances of their success. KFChad now undertaken fee-based activities likeDevelopment of IT Parks, providing consultancyetc.

Shri Pahwa from Haryana Financial Corporation(HFC) shared that HFC was earlier financingindustry in rural areas wherein agricultural landwas taken as collateral security. However, suchfinancing resulted in 90% of the loans becomingNPAs. As a result, HFC’s networth becamenegative and the Corporation became ineligible forrefinance from SIDBI. HFC stopped rural financingand started giving loans only for industries comingup in industrial areas developed by HSIIDC. TheCorporation, after taking permission from HSIIDC,auctions the industrial land of defaulters and hasachieved 100% recovery from sale of such assets.In the year, 2011, the board of HFC had decidedto wind-up the Corporation. However, in the recentboard meeting the winding-up process of theCorporation was put on hold. The Board hadformed a Committee to explore ways in which HFCcould be revitalized which suggested two options

♦ to carry on its activities like the other SFCsafter revival. This would be possible only ifthe State Government gives an interest-freeloan so that HFC could have low cost funds.Also, competent staff comprising ofprofessional would need to be inducted.

♦ in case revival is not possible, it wouldapproach that State Government forliquidation.

Shri Manoj Jain, Manager (Tech.), UPFC, Kanpurinformed the E.C. that the Corporation had anegative networth and needed support to survive.Its revival proposal was pending with the StateGovernment. It needed support from SIDBI andall the stakeholders for its revival. The E.C.Resolved that : “COSIDICI may take up the matterof OTS by UPFC with SIDBI and all efforts bemade to help the Corporation towards this end”.

In this connection, Shri V.S. Rathore, SecretaryGeneral, COSIDICI informed the E.C. thatCOSIDICI vide its letter dated February 26, 2015to Shri Devendra Fadnavis, Hon’ble Chief Ministerof Maharashtra had urged for revival of MSFC.

Shri A.P. Mathur, G.M., RFC, Jaipur said thatGovernment of India has set-up MUDRA Bank -as a subsidiary of SIDBI but SFCs were notincluded as eligible lending institutions with it.COSIDICI vide its letter dated July 23, 2015 hadrequested MUDRA Bank to use the network ofSFCs as well as their proximity to the firstgeneration entrepreneurs and enlist SFCs as‘eligible institutions’ for refinance from it. ShriMathur further informed that RFC had undertakeninsurance business for which it had collaboratedwith National Insurance Company. RFC’ssanctions have gone uptoRs.200 crore in F.Y.2014-2015 (from Rs.84 crore in 2013-14).

Shri B.K. Khandelwal (from MPFC) informed thatMPFC was financing commercial construction andreal estate activities for which it took loan fromHUDCO @ 10.5%% to 11% and kept a spread of3 – 4%. The State Government has guaranteedthe loan. The Corporation took a collateral securityof 150% and is having 100% recovery in suchloans. MPFC has also undertaken fee-basedactivities like transaction advisory services forselling of property, litigation etc. MPFC’s loandisbusements were around Rs.400 crore in theyear 2014-2015.

Shri B.S. Pai Angle, G.M., EDC Goa informed thatEDC Goa was also the nodal agency for the Stateof Goa for its entrepreneurship developmentscheme. It funded graduates from Rs.15 lakhs toRs.20 lakhs. The State Government contributed50% of the loan, 10% was by the entrepreneursand 40% by EDC at interest rates of 8% p.a. formen and 6% p.a. for women. The Corporation hadlent Rs.90 crore to 5000 borrowers and recoveryhad been around 85%. Government of Goa hadalso given land for development to EDC Goa. ShriAngle fur ther informed that EDC Goa wasreceiving funds from Government of Goaearmarked for Land Acquisition as well as depositslying unclaimed with the banks. The Corporationhas received around Rs.150 crore which is partlyinvested and partly used for lending operations.EDC was paying interest at 4% p.a. to the StateGovernment earlier and has now increased it to8% p.a.

Members were of the view that inspite of so manyconstraints faced by the SFCs atleast nine of them

MAY-JUNE, 2015 29

were performing well. The SFCs were contributingtowards the overall development of the States asalongwith the financial assistance they providehand-holding services including technological andmarketing guidance to the entrepreneurs and werealso acting as nodal agencies for many of theschemes of their State Governments.

Shri Oommen informed the Executive Committeethat in the meeting of COSIDICI officials held withSIDBI team on February 03, 2015, it had beenbrought to the notice of SIDBI that refinancesupport from SIDBI had declined in the past 2-3years. It was pointed out that in case of SFCswhich are performing well and complying with thenorms, insistence of State Government guaranteeby SIDBI should be dispensed with. It wassuggested that SIDBI must continue its supportto well-performing SFCs through the refinancewindow and in its role as Supervisor for SFCs,must play a proactive role in initiating the processfor amendment of the SFCs Act, take up planswith Government of India/State Governments torevitalize potentially viable SFCs. Further, SFCsshould be involved in various Committees forMSMEs set up by GoI.

Shri N.K. Maini, DMD-In-charge, SIDBI hadappreciated the role played by SFCs over theyears. He felt that while a few of the SFCs wereperforming reasonably well despite the variouschallenges, many SFCs which had high NPAshave stopped their lending activities and arefocusing on recoveries through settlements underOTS/legal process. In the changing environmentwhere “Universal Banking” had become the orderof the day, Shri Maini agreed that SFCs werefacing competition from banks, which have nowbeen extending term loans to MSMEs in a big wayand are also able to provide a composite packageto meet all their banking needs. The banks haveaccess to cheaper sources of finance ascompared to the SFCs. However, SFCs over theyears, have developed their own expertise in thearea of term lending to MSMEs with their State-wide branch network and local experience, whichcould be leveraged for fee based activities.Although some of the SFCs have strengthenedbusiness processes and have developed robustappraisal systems with pro-active client

r e l a t i o n s h i papproach, thereis still a need forhaving moreefficient andeffective riska s s e s s m e n tmechanism aswell asmonitoring of loan portfolios. Shri Maini hadsuggested that the long term road map of SFCscould be to ultimately become corporatized Statelevel SME focused institutions by conversion intoNBFCs, with lower State Government holdings.This would enable them to raise resources throughpublic deposits and place them in a better andcompetitive situation vis-à-vis commercial banks.

SIDBI was requested that The SFCs Act whichwas last amended more than 14 years ago (inSeptember 2000) needs to be urgently amendedto allow operational flexibility to enable the SFCsto take up activities which are currently notpermitted like trading, housing, education andinfrastructure including large scale industry whichwould help them improve their viability.

SIDBI has agreed to :

♦ take up with Government of India foramendment of the SFCs Act, particularlywith regard to loan limits/new areas ofbusiness.

♦ continue hand holding of better performingSFCs by SIDBI.

♦ meet the concerned State Governmentofficials to discuss about infusion of equityin the respective Corporations/road map forfuture.

COSIDICI vide its letter dated July 23, 2015 hasforwarded the recommendations made by thecommittee of CEOs of SFCs pertaining to theamendment of The SFCs Act 1951 to SIDBI.

Registration of SIDCs u/s 45-1A of the RBIAct, 1934 – Diversification Of Activities:

Shri B.S. Pai Angle, General Manager, EDC Goainformed the E.C. that the SIDCs were set up aswholly-owned State Government undertakings.Their operations are monitored closely by the State

COSIDICI COURIER30

Government who makes appointment of theirBoard of Directors and their accounts are alsoaudited by the Office of the Comptroller and AuditorGeneral of India (CAG). COSIDICI in 2000, basedon the request of the member corporations hadtaken up the matter with the Reserve Bank of Indiaand impressed upon them the desirability ofexempting SIDCs from the provisions of the RBIAct on the ground that SIDCs, unlike otherNBFCs, were subject to State Governmentcontrol, on the one hand, and supervision of IDBI/SIDBI through inspections, on the other. The RBIhad agreed to COSIDICI’s request and exemptedSIDCs, being government companies, undersection 617 of the Companies Act, from theapplicability of the provisions of the RBI Act relatingto maintenance of liquid assets and creation ofreserve fund, as also Directions relating toacceptance of public deposits and prudentialnorms. However, the requirement of statutoryregistration of SIDCs under section 45-1A of theRBI Act, 1934 continued.

These SIDCs are engaged in creating industrialinfrastructure and setting up of industrial parks,estates, SEZs etc. The SIDCs which hadregistered as Non-Deposit taking NBFCs arefinding it difficult to periodically furnish thevoluminous data required by the RBI in itsquar terly returns as it is very tedious andconsumes a lot of man hours thus impeding theiroperations. In this connection, Shri Mahavir Singh,Addl. G.M., HSIIDC, Chandigarh informed thatHSIIDC had earlier registered itself as NBFC.Later on the finance income of the Corporationdecreased and therefore, HSIIDC de-registereditself. Shri Singh advised that registration with RBIas an NBFC is mandatory only if the financialincome of a Corporation is more than 50% of itstotal income.

COSIDICI vide its letter dated 20th & 26thFebruary, 2015 had forwarded a Proforma to befilled by the Member Corporations. The ExecutiveCommittee was informed that COSIDICI hasreceived response from 13 SIDCs MemberCorporations (out 29). Of these, only five SIDCsviz. KSIIDC, Bangalore; SICOM, Mumbai; PIPDIC,Pondicherry; PSIDC, Chandigarh;, KSIDC, Keralaare registered with RBI. COSIDICI was requested

to follow-up the matter with the members so thatRBI could be approached in the matter.

COSIDICI National Awards For “OutstandingEntrepreneurs”:

The Executive Committee appreciated the effortsof Shri P. Joy Oommen and COSIDICI inorganizing the COSIDICI National Awards functionwhich was held on November 25, 2014 at Al SajConvention Centre, Kazhakuttom,Thiruvananthapuram. They felt that the COSIDICINational Award Function, 2014 had beensuccessful in its objective viz. of giving visibility tothe contribution made by the SLFIs towards theindustrialisation and economic progress of thecountry and to motivate the successful units tocontinue with their good performance. TheExecutive Committee also felt that COSIDICI mayobtain information on whatever “special incentives”have been provided by States to attractinvestment, from the respective SFCs/SIIDCs andshare among other Member Corporations.

Further, the Executive Committee decided to holdthe COSIDICI National Award Function - 2015 ata convenient venue which may be decided lateron in consultation with the President COSIDICI.COSIDICI was requested to formulate the criteriafor nominations and send them in September, 2015to Member Corporations so as to give themsufficient time to select the awardees.

Essay Writing Competition organized byCOSIDICI :

The Executive Committee appreciated the initiativeof COSIDICI for holding an Essay WritingCompetition on the topic “Need for Diversificationof Activities of SLFIs in the current EconomicScenario of India” and felt it would impart a senseof participation among our Member Corporations.The Executive Committee, urged the Members toparticipate in the competition and share theirexperiences by giving Articles on the above topic.

COSIDICI Executive Telephone Directory, 2015for COSIDICI’ Member Corporations:

The Executive Committee was happy to note thatCOSIDICI has recently published “COSIDICIExecutive Telephone Directory 2015” for itsMember Corporations.

MAY-JUNE, 2015 31

SUCCESS STORIES OF KARNASUCCESS STORIES OF KARNASUCCESS STORIES OF KARNASUCCESS STORIES OF KARNASUCCESS STORIES OF KARNATTTTTAKA STAKA STAKA STAKA STAKA STAAAAATE FINANCIALTE FINANCIALTE FINANCIALTE FINANCIALTE FINANCIALCORPORACORPORACORPORACORPORACORPORATION ASSISTED UNITSTION ASSISTED UNITSTION ASSISTED UNITSTION ASSISTED UNITSTION ASSISTED UNITS

Alva’s Health Centre is a partnership concern constituted in the year1986. The promoters include Dr. M. Mohan Alva, Mr. Vivek Alva andMr. Vinay Alva. The health centre offers advanced medical facilitieslike cardiosoft TNT and scanning with colour doppler.

KSFC advanced a loan of Rs.147 lakhs for expansion andmodernisation of the Health Centre, which has grown into a multi-specially hospital with sophisticated medical equipment, offeringservices in the field of allopathy, homeopathy and ayurvedic medicine.

Alva’s Health Centre made a turnover of Rs.99.60 lakhs, Rs.103.33lakhs and Rs.120.68 lakhs respectively during the years 2006, 2007and 2008.

Their associate, Alva’s Education Trust, was also sanctioned Rs.75lakhs for establishing the ayurvedic medical college and hospital.

ALVA’s Health Centre, Mudbidre

Hotel Premier Karwar

Mr. Dinakar Sukru Salunke was a civil contractor. Since Karwaris a tourist destination, he recognised the potential for hotelindustrial by establishing Hotel Premier. He availed financialassistance of Rs.36.84 lakhs in 2003 from Karnataka StateFinancial Corporation. The hotel is running successfully with aturnover of Rs.71.50 lakhs in the year 2007-2008.

With a view to expand his business, he also availed an additionalloan of Rs.100 lakhs for a new hotel project.

A positive attitude may not solve all your problems, but itwill annoy enough people to make it worth the effort.

COSIDICI COURIER32

RBI allows ARCs resolution period beyond 8years

The RBI has given asset reconstructioncompanies (ARCs) long resolution period (beyondeight years) to ensure smooth working ofrestructuring package for stressed accounts. Thetime for redeeming security receipts (SRs) heldagainst assets might be extended in congruencewith the resolution period approved by joint lendersforum and a corporate debt restructuring (CDR).

At present, ARCs get up to eight years forresolution of stressed assets. However, in mostcases, the repayment period goes beyond eightyears. In such cases, ARCs holding part ofstressed assets, had expressed their inability togo along with other lenders beyond eight yearsdue to regulatory constraints. They insisted on anexit at the end of five or eight years, jeopardisingthe restructuring efforts of a majority of lenders.With the amendments, ARCs will be able to playan effective role in resolution of stressed cases.

IFCI gets Rs.200 crore to promote biz amongSCs

Government has allocated Rs.200 crore to IFCILtd to promote entrepreneurship among the peoplebelonging to scheduled caste (SC). To promoteentrepreneurship among the SCs, the governmenton May 06, 2015 launched Credit EnhancementGuarantee Scheme (CEGS) for SCs for providingcredit enhancement guarantee facility to banksextending financial assistance to young and start-up entrepreneurs, belonging to SC.

Under the scheme, it will provide guarantee topublic sector banks which in turn provide financialassistance to those entrepreneurs. “The guaranteecover under the scheme shall be ranging from Rs20 lakh to Rs 5 crore,” said the release. IFCI Ltd.is the nodal agency for the scheme and has beenentrusted with the responsibility of managing it.

Banks’ export credit dips on high interest rates

High interest rates have hit the export creditportfolio of Banks. RBI data show banks’ export

ALL INDIA INSTITUTIONSALL INDIA INSTITUTIONSALL INDIA INSTITUTIONSALL INDIA INSTITUTIONSALL INDIA INSTITUTIONS

credit as of Aprilhad fallen by 8.7per cent from theRs.48,200 crorea year before toa b o u tR s . 4 4 , 0 0 0crore. In thesame period ayear ago, exportcredit had shown 13.4 per cent growth, fromRs.42,500 crore as of April 2013. Among allsectors, export credit saw the sharpest decline indeployment of gross bank credit as of April thisyear.

After the government withdrew the three per centinterest subvention scheme for exports in April2014, the cost of rupee credit has gone upsignificantly, say exporters. The governmentwithdrew rupee export credit to the MSME (micro,small and medium enterprises) sector and fromalmost all engineering export products. Gettingbills discounted from a foreign bank which have atie-up with the importer’s bank has become a muchmore viable option. However, the window isavailable to only large export houses, based ontheir counterpart importer’s credit record with theirrespective foreign lender.

Exporters are getting rupee credit at around 11per cent from domestic banks. However, if the billsare discounted from foreign banks which have atie-up with importers, the rate of interest is lessthan two per cent per annum. In addition, paymentis in dollars.

Capital infusion in state-run banks would beneed-based

The government has decided to infuse capital inpublic sector banks (PSBs) based on therequirement of individual lenders - which is adeparture from the precedent set last year. Thegovernment has asked PSBs to make detailedpresentations on their capital requirement for thecurrent financial year. If the government is

MAY-JUNE, 2015 33

convinced that a bank needs funds, then it willinfuse capital. The government has earmarkedRs.7,940 crore for capital infusion in PSBs in 2015-16.

Last year, the finance ministry decided to infusecapital in nine PSBs depending on theirperformance. Two parameters were applied foridentifying the banks. First the weighted averageof return on assets for all PSBs, for the last threeyears put together, was arrived at and all thosewho were above the average were considered.The second parameter used was return on equity(ROE) for these banks for the last financial year.In F.Y. ‘15, the government infused close toRs.6,990 crore compared with Rs.11,200 crorethat was allocated by the previous governmentduring the interim Budget.

RBI for better strategies to deal with bad loans

Reserve Bank of India on June 11, 2015 made acase for developing better strategies to deal withthe problem of bad loans as hiding them wouldaggravate the situation for the Banks as well asborrowers. An account becoming an NPA is not asin. It would be a better strategy, that if there is aweakness in the account, rather than postponingand hiding the problem, the bank recognizes it andlends a helping hand (to borrowers), said RBIDeputy Governor, Shri S.S. Mundra. Stressing thatthere is no regulation in the world that prohibits“rehabilitation” of NPAs, he said, “if exposure istoo big, bank is in a weak position. In either of thesituation one of the parties will be in a weak position.“…..once you declare an NPA the realities areknown and both the parties can sit across the tableand workout a support plan which is more realisticand which is likely to succeed”. As of December,2014, gross NPAs in PSBs were at Rs.2,60,531crore or 5.6% of the total advances. The top 30defaulters are sitting on bad loans of Rs.95,122crore, which is more than one-third of the entireNPAs of public sector banks. It amounts to36.50%.

SIDBI electronic platform to make it easier forstart-ups to access institutional funds

Raising institutional finance - both equity and debt- is likely to become easier for early-stage start-

ups. SIDBI which targets micro, small and mediumenterprises (MSMEs), is setting up an electronicplatform for institutional investors, angel andventure capital funds, start-up accelerators andincubators ventures to meet the financing needsof early-stage start-ups. The collaborativeelectronic platform under the National InnovationFinance Programme (NIFP) is currently in thedevelopment phase in the Centre for Innovationand Incubation and Entrepreneurship (CIIE) ofIndian Institute of Management (IIM), Ahmedabad.The high-end technology platform, backed withanalytics tools, will enable investors to manageand monitor investments in small enterprises, whilegiving start-ups a one-stop shop for meeting theirfunding needs. At the pilot stage, the electronicplatform would offer assistance to 10-15 start-ups,before ramping it up to the need of 500-oddcompanies.

According to Shri K.I.Mani, General Manager,SIDBI, SME Development Centre, thedevelopment bank is playing the role of a “marketmaker” in this exercise, while collaborating withdifferent stakeholders, including the IIM Centre andthe German sustainable development agency, GIZGmbH. “We want to bridge the gaps in the MSMEsystem, rather than become the biggest lender tothe sector”

ARCs to buy Rs.14 k-cr NPAs in FY 16 : CRISIL

Given the low systemic absorption capability,asset reconstruction companies (ARCs) willacquire non-performing assets (NPAs) worth onlyRs.12,000-14,000 crore in 2015-16, according toa CRISIL-Assocham study. The capitalconstraints, expectation mismatch on valuations,low recovery rates and longer resolutiontimeframes are certain reasons for inadequateabsorption capacity of ARCs.

The study, ‘ARCs-The new normal: Growthtempered, recovery in the crosshairs’, says it isimperative for ARCs to innovate through modelslike consortium bidding to acquire larger assetsand share risks considering that access to capitalremains critical.

Though gross NPAs of Indian banks will edge upin fiscal 2016 by 20 basis points to 4.5 per cent of

COSIDICI COURIER34

advances i.e. by Rs 60,000 crore to Rs.4 lakhcrore, however only a fifth of the incremental NPAsis likely to be sold to ARCs. The bad loans areseen rising mainly because of withdrawal ofregulatory forbearance on restructuring and highslippages from restructured assets, as much as40 per cent of assets restructured betweenfinancial years 2011-14 have degenerated to NPAs.

Assets under management (AUM) of ARCs willgrow slower at 11 per cent (net of redemption) inFY16. The fresh issuances of security receipts(SRs) will grow around 18 per cent, as they grapplewith the new guidelines. AUM of ARCs will taperto 11 per cent in FY16 compared with 30 per centin F.Y. ‘15 which was a four-fold increase over F.Y.2014.

SIDBI offer for MSMEs on Make in India Fund

MSME lender SIDBI will offer a concession of 50basis points (bps) to eligible borrowers under theMake in India scheme. “SIDBI has set up aRs.1,000 crore ‘Make in India’ fund for MSMEs”said Shri Kshatrapati Shivaji, CMD, SIDBI. Theobjective is to make our MSMEs world-classmanufacturing hub. Under the fund, concessionalfinance will be provided to identified MSMEsectors. The net profit of SIDBI increased by26.8% to Rs.1,417 crore.

Govt. may infuse Rs.19 k cr into PSU banks inFY 16

The government is likely to take the bankinvestment company (BIC) route - an omnibusholding company model proposed by the P. J.Nayak Committee set up to review governance inbanks - to meet the capital infusion requirement inpublic sector banks (PSBs).

The Finance Secretary, Shri Rajiv Mehrishi, in theUS with Finance Minister, Shri Arun Jaitley topromote investment in India, told a private newschannel on Monday that the government wouldinfuse Rs.19,000 crore in banks this financial year,adding the amount could double next financial year.

The planned capital infusion into state lenders,which account for more than 70 per cent of alloutstanding bank loans, is more than double theBudget estimate for this financial year. Banks willneed more funds, as they have to provide morecapital for the rise in non-performing assets(NPAs). According to ICRA, gross NPAs in thesystem might rise to 5.9 per cent this financial yearfrom 4.4 per cent in 2014-15. As the governmentisn’t keen to allocate the funds from the Budget, aBIC could be used to meet the huge fundingrequirement. By 2018, PSBs will need Rs.2.4 lakhcrore of capital to meet Basel-III norms, accordingto a finance ministry estimate.

For a BIC to be formed, existing Acts such as theBank Nationalisation Act, the SBI Act and the SBI(Subsidiary Banks) Act have to be repealed andall banks have to be incorporated under theCompanies Act. The government will then transferits holdings in banks to the BIC.

According to the recommendations of the Nayakcommittee, a BIC would be constituted as a coreinvestment company, under Reserve Bank of India(RBI) registration and regulation. The nature of itsbusiness would make it akin to a passivesovereign wealth fund for government banks.Welcoming the change in approach for capitalinfusion, PSB executives said initially, theprovisions for capital infusion might come out ofannual Budgets.

Credit growth at tepid 3.7% in first 9 monthsof FY 15

Bank credit grew at tepid 3.7% rate during the firstnine months of the past financial year atRs.63,51,900 crore, according to the datareleased by RBI. The number of borrowalaccounts increased by 3.7% to 12.2 crore inDecember 2014 from 11.7 crore in March, 2014.Small borrowal accounts each with credit limit upto Rs.2 lakh, constituting three-fourths of totalnumber of borrowal accounts had a share of 7.3%in total outstanding credit in December, 2014.

Every disappointment in life can be stepping stone to greater things.

MAY-JUNE, 2015 35

Change in Mega Food Park scheme Approved

The Cabinet approved a modification in the Mega FoodPark scheme on 6th May, 2015 to streamline itsimplementation to attract investment in the foodprocessing sector. The decision would benefit 6,000farmers directly and 25,000 indirectly in each mega foodpark.

The CCEA also approved a proposal to revise the DoubleTaxation Avoidance Agreement (DTAA) between Indiaand South Korea to provide tax stability, boost economiccooperation and investment between the two countries.The Cabinet also gave its approval to sign an MoU onrenewable energy co-operation between India andSeychelles to strengthen bilateral co-op in this field.

Govt cancels 22 SEZs for lack of ‘satisfactory’progress

The government has cancelled approvals of 22 specialeconomic zones, including that of Tamilnadu IndustrialDevelopment Corporation and True Developers, as no“satisfactory” progress was made to execute the

INFRASTRUCTUREINFRASTRUCTUREINFRASTRUCTUREINFRASTRUCTUREINFRASTRUCTURE

projects. Thedecision was takenin the meeting ofthe Board ofApproval (BoA)headed byC o m m e r c eSecretary ShriRajeev Kher onMay 19, 2015.

Govt to clear 6 pharma parks with Rs.180-crinvestment

Government is set to approve six pharma parks thisyear at an estimated investment of Rs.180 crore topromote the pharmaceuticals manufacturing. “This yearthe six pharma parks will be allocated on pilot basisand in the next year the Ministry will seek Rs.1,000crore from the finance Ministry for setting up parksacross the country,” Fertiliser and Chemical MinisterShri Ananth Kumar said in June.

1.[a] Sea Code : The company is being promoted by techies David Cook and Roger Greenbacked by investor Barry Shillito, a former US Assistant Secretary of Defence.

2.[c] MindTree Consulting : According to company’s website, “the decisive skyward, bluebrush stroke is Chetan’s way of communicating imagination. The red stands for action, aand the bright yellow bubbles represent joy”. These are the three things the companyvalues.

3.[d] Wipro Technologies : Wipro achieved these distinctions in 1998 and 2001 respectively.Both these certificates are awarded by the Software Engineering Institute (SEI), a researchand development center sponsored by the US Department of Defence and operated byCarnegie Mellon University. According to the official websites, Capability Maturity Model Integration (CMMI) is aprocess improvement approach that provides organisations with the essential elements of effective processes. Itcan be used to guide process improvement across a project, a division, or an entire organisation. The PeopleCapability Maturity Model (People CMM) is a framework that helps organisations successfully address theircritical people issues. Based on the best current practices in fields such as human resources, knowledgemanagement, and organizational development, the People CMM guides organisations in improving their processfor managing and developing their workforces.

4.[a] Digital GlobalSoft : Digital Global Soft, formerly, Digital Equipment ((India) Limited, is an IT services company inIndia. Earlier a 51% subsidiary of DEC, it is now a part of HP, having the name Hewlett-Packard GlobalSoft Limited.

5.[b] Google.6.[d] Dennis Carter : Dennis Carter was a Marketing Manager in Intel. Intel created a co-op fund where it would take

a percentage of the purchase price of processors and put it in a pool for advertising funds. Available to allcomputer makers, it offered to cooperatively share advertising costs for PC print ads that included the Intel Logo.

7.[b] Steve Jobs.8.[a] David Rhodes : Also known by his Internet name Dave Rhodes, David was sentenced to ten-year imprisonment.

Later on he denounced the scheme in his own website as a condition for his people.

9.[b] SETI ( Search for Extraterrestrial Intelligence) : SETI is a scientific effort aimed at discovering intelligent lifein other parts of the universe. It involves detection of radio signals as a sign of presence of intelligence in otherparts of the universe.

10.[c] Apple IIc : The design had pure white as the color of the case, that is why the name SnowWhite.

ANSWERS OF CYBERQUIZ~54ANSWERS OF CYBERQUIZ~54ANSWERS OF CYBERQUIZ~54ANSWERS OF CYBERQUIZ~54ANSWERS OF CYBERQUIZ~54

COSIDICI COURIER36

You can be negatively affected by cough, bothphysically and emotionally. There are several tipsgiven below to enable you to start How to get ridof a dry cough.

When you have an assault, make a note aboutthe environment you’re in. In time you should beginto see patterns and be ready for environmentalfactors which could cause issues for you.

A great hint that will help you to get rid of a coughis to keep your home clean. You’re going to bemuch more susceptible to having a cough attack,if your house is messy. Make sure you do not useany cleaning products because they may alsotrigger cough that have harsh substances in them.

It is important that you just keep work environmentand your house clean if you’ve cough. Germs anddust can worsen your cough symptoms and cutoff oxygen to your own lungs. Because dust pilesup fairly quickly, it’s recommended that you dustyour furniture and appliances one or more timesweekly.

There are specific medications that exacerbateor cause cough symptoms. Not everyoneunderstands this. Aspirin and some NSAIDs mightdo that. Furthermore, beta blockers, a sort ofmedicine used for hypertension and heart disease,may cause cough symptoms. It’s important for thedoctor to know your entire medical history,including any medications you are currently taking,so they can treat your cough.

There’s a medication available that can help forlengthy amounts of time, if allergy symptomscause one to have moderate to severe coughattacks. Omalizumab is an arbitration that is ableto control allergic reaction symptoms.

For those who have cough, know your triggers.

HEALHEALHEALHEALHEALTH CARE !TH CARE !TH CARE !TH CARE !TH CARE !

What could it bethat causes acough episode tocome on? Manycommon triggersare allergies andirritants. Forsome, it isexercise or excessive temperatures. Coughstrikes can be also caused by anxiety or mentalproblems. Knowing what causes your episode canalso be what will help you find a treatment that isproper.

Take note of how your diet affects your cough.Often special foods like peanut butter containallergens for anyone afflicted by cough. For thosewho have particular food-based triggers, manageyour diet to prevent those ingredients and minimizeyour cough symptoms and episodes. Track yoursymptoms to ensure a new food doesn’t causeincreased cough problems, if you attempt it Howto get rid of a cough. Keep all your regular coughappointments that are scheduled, no matter howyou’re feeling. Cough is understood to intensifythe effects of the common cold and the flu,especially respiratory infections and the affiliatedsinus. Hence it is suggested for those who havecough to keep influenza shots during thewintertime.

Know what triggers your cough and how exactlyto avoid them. Triggers are different for eachindividual, so it may take some time to determinewhat yours are. Keep a diary of them.

With some patience and some work, you can keepit, although cough can be extremely difficult. Itmerely requires research, as well as, requestingyour doctor what to do and just how to treat it sothat you can breathe better.

How To Get Rid of A Bad Cough Today with These Great Hints ?

When everything comes your way, you’re in the wrong lane.