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INDIA EMERGING ECONOMY & VIBRANT MARKET . Amit Narang - 2009 10 16 . Presentation to TAITRA Seminar on Indian Food Processing Industry . Contents . Overview of Indian Economy . The 5 D Framework 5D . - PowerPoint PPT Presentation


INDIAEMERGING ECONOMY & VIBRANT MARKETAmit Narang -20091016Presentation to TAITRA Seminar on Indian Food Processing Industry ContentsOverview of Indian EconomyThe 5 D Framework5DThe Why India MatrixIndia-Taiwan Trade & Eco. Relationship The India DealArea: 3.3 Million Sq. Kms3307th Largest Country28 States 28Coastline: 7500 km 7500: , , , , : : , 21 : (82.6%), (11.4%), (2.4%), (2.0%), (0.7%) : (US$1 = INR 49)ChennaiNew DelhiMumbaiSouthern Golden TriangleIndia: Location Democracy Worlds Largest democracyLargest digital elections10 major parties 50+state parties10503 MN elected representatives 3DiversityHighly diverse23 Official languages236 major religions6Diaspora Over 20 MN Indians outsideIndia2Indian companies outboundM&A > US$15 BN in 2006>2006150Demographics Youngest Nation in the world112,442 MN population < 20 Yrs Age442206 MN graduates p.a / English Speaking6Demand 5th largest consumer market in the worldby 2025.20255350 MN growing middle class > 583 MN by 202535> 2025583The 5 D Framework5DBusiness FriendlyEmerging Economic Powerhouse Strong Economic Fundamentals Human Dividend Huge Consumer Market Attractive Investment Destination Reliable Trade Partner Why India GDP grew at an average annual growth rate of 6% between 1980-2003 198020036% 2nd Fastest Major Economy in the world2 GDP growth :2005-06: 9.4%2006-07: 9.6%2007-08: 9.0%2008-09: 6.7% Growth of over 8% for 14 successive quarters from 2005-06 to 2007-082005-08148% Sustained double digit growth likely2Growth in sectors at Current Prices (2007-08)Industry: 10.7%Services: 8.9%Agriculture: 2.6%Emerging Economic Powerhouse INDIA in 2050 | 2050 (Source: Goldman Sachs: BRICs Report) | ::4)India will be the 3rd Largest economy, with the Fastest rate of Growth ..3Goldman Sachs Later Revised the Forecast: India to cross US economy before 2050 to become 2nd Largest:2050,2Emerging Economic PowerhouseOver 65% of GDP from Private Consumption (Japan:55%, China: 40%):65%(55%,40%)Low Export Dependency of 16%,16%Steady Reserves of Foreign Exchange: From US$ 5.8 BN in March 1991 to US$ 341 BN in May 2008:199135820072,850200853,410Indias Forex Reserves are in excess of the External DebtExternal Debt-to-GDP RatioStrong Economic FundamentalsMarket Cap up from US$ 140 BN in 2001 to over US$ 1 TN 20011,400,1Domestic Investment rate as a %age of GDP up from 27.6% in 2003-04 to 39% in 2007-082003-0427.6%2007-0839%Domestic Savings rate: More than 30%:30%As % of GDPIndian Banking & Financial System is healthy and Robust Proportion of poor quality assets is on the decline (%)Capitalization ratios are strong (%)Strong Economic Fundamentals Free-market democracy with a legal and regulatory framework that rewards free enterprise, entrepreneurship and risk taking , Long history of entrepreneurship & private enterprise Bombay Stock Exchange (1875) Oldest Stock Exchange in Asia 1875-Third largest investor base in the world In 2007, there were a total of 676 M&A deals and 405 private equity dealstotal value of over US$ 70 BN > In 2008 = 454 Deals/ US$ 42 BN 2007676405,700.2008454,420World Competitiveness Ranking (Lower the better)Business Friendly EnvironmentYoungest Population in the World: More than half of Indiaspopulation is below 25 yrs age:,25Over the next 5 years, India alone will account for more than1/4th of the increase in worlds workforce,4,1Worlds Largest Pool of English Speaking Scientists and EngineersLeast Old-Age Dependency rate in Asia,Implications: : Strong Consumption pattern to continue Long term and Stable Growth Availability of Skilled Labor Force Assured over Long Term Every year 6 million graduates 6 600,000 Engineers 60 150,000 IT professionals 1512,000 PHDs 12Human Dividend350 million strong Middle Class35Rs. 55 Trillion worth of new market to be created by 2025 -20255.5India will become worlds 5th largest consumer economy by 2025,20 ,202 5*Mckinsey Fastest Growing Mobile Subscriber base in the worldAdding over 10 million new Mobile Subscribers Each MonthJanuary 09: 15 Million | Feb 09: 13.5 MN :1.20091:15. 20092:1350Total No of Mobile Connections = 403MN: 43Every Year, India adds: :150 million new mobile phones 7.3 million new Personal Computers 1.6 million Cars 7.4 million Two-wheelers 2007 Global Retail Development Index (GRDI) India is the top destination in the AT Kearney Global Retail Development Index (2007)AT Kearney 2007Huge Consumer MarketIndia is ranked second in AT Kearneys FDI confidence index (2007) AT Kearney20072India has the highest returns on Foreign Capital (-US Department of Commerce)()FDI on the up: Year 2006: US$ 11.1 BN ; 2007-08: US$ 32.4 BN | April-Nov 2008: US$ 16.58 BN (Up 90%): 2006: 111 ; 2007-08: 324, 2008 4-11 165 (90%) 100% FDI permitted in manufacturing (except atomicenergy) ,100%Investments, dividends, fees are freely repatriable,,Foreign investments allowed in capital marketsState Government compete for Investor Friendly ImageRank Country 1 China 2 India 3 US 4 UK 5 Hong Kong 6 Brazil 7 Singapore 8 The UAE 9 Russia10 GermanyTop 10 FDI Investment Destinations 10 Investment Friendly Destination Exports growth at over 23%23%Total trade in 2006-07: US$ 330 Billion /2007-08: US$ 390 BN2006-07: 3300 / 2007-08: 3900 2007-08: Exports Growth: 23%/ ImportsGrowth: 27%2007-08 :: 23%/ : 27%Manufactured Goods Exports growing at 38%38%Main Exporting Destinations: EU, US, Gulfand China:,, Open Trade Regime: Between 2001 and 2007,Avg MFN Tariff down from 32.3% to 15.8%: 2001 2007: 32.3%15.8%Reliable Trade Partner Economic Powerhouse of the FutureStrong Economic Fundamentals Vibrant Financial MarketSolid Framework for Business: Democracy, Independent Judiciary, Global Outlook: ,,Strong Entrepreneurial SpiritDemographic Advantage: Long term growth prospects:Strong Domestic Consumption MarketValuable Manufacturing Destination: Favorable Policies, Skilled & Abundant labor:,Rapidly Improving InfrastructureWhy INDIA: In Sum : Taiwanese Investment in India: Over US$ 1 Billion: 10Promising Sectors for Taiwan Infrastructure Auto-Components Food Processing IT/ Electronics Manufacturing Leather/ Footwear Textiles Machinery/ Machine Tools ..etcIT = India + Taiwan IT Bilateral Investment Protection Agreement signed Double Taxation Avoidance Agreement & ATA Carnet expected this year TAITRA Offices in Mumbai & Chennai III Office in Chennai TAITRONICS in Chennai Regular Dialogue Exchange of Delegations MOUs between Industry Organizations India-Taiwan: Institutional Framework -: 2002 = US$ 1.19 BN 2007 = US$ 4.8 BN2008 = US$ 5.3 BN200211.9200748200853In 2008, Indian Exports to Taiwan Declined, Taiwanese Exports to India grew 29%2007165%India-Taiwan Trade INDIAN EXPORTS TAIWANESE EXPORTS Mineral Fuel, Oil EtcMineral fuels, Oils etc.CerealsElectrical MachineryOrganic chemicalsMachineriesCottonPlastics and its articlesIron and steelOrganic ChemicalsCopper and its articlesIron and SteelAluminium and its articlesMan-made FilamentsFood residuesImpregnated Text FabricsSalt,sulphur, earth,stone Articles of Iron and SteelElectrical MachineriesTanning / dyeing extractsChart21.2061.4011.9452.4422.7164.8795.346India-Taiwan Trade (US$ Billions)Sheet1YearTotal20022003200420052006200720082002200320042005200620072008Total1.2061.4011.9452.4422.7164.8795.346Sheet1India-Taiwan Trade (US$ Billions)Sheet2Sheet3 Branding and Brand Positioning Key to Long term Success Market Highly Price and Quality Sensitive Focus on Innovation and New Products Strategic Partners & Local Management can add Value Act Local but Think Global: Urban Indian highly In-tune with Global Trends: India One Market for Branding; Multiple Markets for sourcing/ manufacturing,;, Made in Taiwan Enjoys Prestigean advantage , Be Future Oriented, but Build NOW,The India Deal Elections 20092009 More than 700 million Voting Population | 7Elections spread over 1 month | Fully electronic Results out in One Day1 | 1Elections 2009: Congress led Coalition gets comfortable majority2009: A Vote for Stability: Continued Economic Reform expected: And a Vote for Investor Confidence: Net Inflows of Foreign Institutional Investors (FIIs) increased from US$ 100 MN in March 09 to US$ 1.3 BN in April 09 | 200931413Mumbai Stock Index has gained 46.3% this year | 46.3%Indian Rupee has strengthened 5% in May 09 | 55%India ranked as the most promising country to survive the Economic Crisis by Servcorp International Business Confidence Survey in April 09 | Servcorp4Elections 20092009IMPLICATIONS Strong fundamentals + +Dynamic Growth in the last few years + +Stable and Reform Oriented Government in place = Sustained and Strong Growth Assured= India-Taipei Association-Suite 2010, International Trade Buidling, TWTC,2010333, Keelung Road Section 1, Taipei1333Tel: (02) 2757 6112Fax: (02) 2757 6117Email: / For more information or assistance, please contact:,:Thank You


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