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Quality silica from Neyveli Silver Years of Madras Musings Delhi Chalo... B H Kothari - a tribute No engine for this car Making ‘my Amaravati’... Convulsions in The Hindu PC’s preference for professionals CIPET hqrs to stay at Guindy – for the present? Gay abandon in pricing EVM is tamper-proof The star of Spencers is no more The ‘Ayyo-yes’ is no more Tribute – M V Murugappan Cement prices continue to rise… Kinetic Karnataka Rahman at CIC Padma Bhushan for A Ramakrishna Moily’s bold thrust S Ramanathan – a versatile musician, musicologist Why this malaise in medical education? No Maha Koottani in TN... Wanted: a second airport for Chennai Fall in crude prices help in oil sector reform TN accounts for the largest recruits by the IT sector Valli, they are more marginalised An inexplicable neglect Boy, can you beat these? Lesson from Chandrababu Naidu Remembering Indira Sivasailam... All eyes on Sankara Nethralaya IAS invades NDDB... Editor's Notes CII projects higher growth… Demise of a media baron... IPL type auction for VCs? Delhi returns to BJP Shipping woes of Chennai companies Naidu’s return augurs well for Seemandhra Whistle-Stop Tour of Raghuram Rajan Chennai and Kolkata miss opportunity to grow as Delhi and Mumbai Parliament in paralysis... The balancing act Polls and promises WTO Meet: resolved to meet again A friendly business group TN – agglomerate land holdings without alienating ownership When TN politicians can emulate Kerala's A think tank for Chennai A rich pool of talent not utilised…. Noble nonagenarians... Shale gas and its shallow future Bihar – Nitish Kumar adopts the Lalu model More Shakthi to Das’ elbow Modi storms Silicon Valley EEC at the National Media Centre Paytm karo... Contrarian cousins Computation of GDP – conundrums continue R Sridhar steps down as CEO of Shriram Capital Tough task taking states together Welcome focus on core competence Vibrant Gujarat Insurance companies bleeding, yet no decision on increasing FDI limit! Liberal imports idling indigenous capacities Cutting the nose to spite the face West Bengal: mindless malignancy Discoms deserve better… Sweeter prospects for sugar The Ports’ Pasha expands into Tamil Nadu Should we change the official year? Marketing expert Balagopal is no more Eternal support for capitalisation of PS banks Banning booze... Welcome changes that testify to Jayalalithaa’s return to health Tribute – UCAL Selvan… A Grand Finale for SN’s MS centenary at the US… Auto components surge… Music happens Welcome thrust on trade in Modi’s foreign visits... Preserving for the future When Ratan Tata visited SRM Adapt Vajpayee dinner diplomacy S V Raju – a ‘good’ true liberal Small units prefers to remain small... 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The industry which thrived on the protection of a closed economy and the advantage of a vast domestic market, has failed to organise its evolution on healthy lines Make standards certification mandatory... Like Hinduism: many paths to reach God... Where a state respects its litterateurs… L&T: focus on infrastructure and more infrastructure… Medical costs hit the roof... For whom the bell tolls? Tribute Don’t seem to feel the pulse… Haul over the coal The ‘Jayanthi Tax.’ Gas is the way forward Online not in line with brick and mortar businesses... Strengthen the base... Tax agriculture Infrastructure funding – lessons learnt Fortune 500 review Excel Generators provide the vital back-up CSR and CMI: promise of another Srinivasan Ramanujan... Kulandai was a giant When online building permits work…. 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A more liberated TN… The why of tax incentives No mega rail project for Tamil Nadu Breaththrough in malaria control Roaring Ro-Ro facility He saved millions from starvation... China invests in India L&T- the specialty of special purpose vehicles Wise Presidents A C Muthiah – his munificent bequeaths to science Reliance’s TV – 18 ready to launch Tamil News Channel GM Technology at last! Lalu’s envy, India’s pride Put expensive assets created to use... A glass full of corruption Focus on quality of power - its only around 170-180V Maximising the micro pricing … Why land prices zoom in TN? Streamlining mandatory third party cover Tihar, Puzhal not different from Parappana Agrahara Solar, solar everywhere … Measuring roof tops in terms of KW/MW Towards speedy justice Waning interest in public discussions… For whom the MIDS bell tolls? Delhi is distant Revive development banks... TIAM turns a full cycle Which side are you, Montek? This scant respect for Law When nations steal growth from one another… When the President was rendered homeless… Tatas moving out of urea production... Odisha: spectacular win by Naveen Patnaik Quality education through the PPP mode Alexa – Talking Wikipedia A welcome initiative by the judiciary Airlines in India: cost and space Shaming of Tamils by Tamil farmers at Delhi An informal presentation - analytical, forward locking... Inflation: are we emulating Argentina and Brazil? The power-full Hindujas MHC should not return to its old indisciplined ways The nuclear option Tribute – Manikam Ramaswami Return to king coal for urea... Protest masters... GNS - 100: our first subscriber Build close rapport with business leaders Things happen by accident and not by design... There was flood of milk. Reason: no milk commissioner! Adharma of opposition politics An enemy’s enemy is a friend A Grand Finale for SN’s MS centenary at the US… Welcome GST The few handicaps...
 
CII projects higher growth…

SUCCESSIVE DROUGHTS of the last two years had contributed to zero agriculture growth.  A vast range of commercial crops, including sugarcane and cotton, recorded decline, causing widespread misery in several parts of rural India.

In this background the prediction of an average monsoon is welcome. This kindles hopes on a significant improvement in agriculture growth. This has two favourable tidings: first a higher rate of economic growth, with agriculture sector accounting for 14 per cent of GDP, the jump in the agricultural sector could contribute to more than one per cent growth of GDP. CII predicts economic growth can be around 8.2 per cent!

The second is its impact on the rural economy. Better incomes would trigger higher spending on goods and services and will help increased production of consumer goods and other services.

Naushad Forbes, who had taken charge as President-CII, pointed to several green shoots: much higher demand for automobiles and tractors, step up in investments on highway development, railways and other infrastructure sectors and an improvement in investor sentiment. He also referred to the Centre facilitating states to undertake reforms in crucial areas like land and labour. Forbes pointed to Andhra Pradesh, Gujarat, Madhya Pradesh and Rajas-

than undertaking labour reforms to ease doing business. He also referred to Rajasthan and Tamil Nadu focusing on land reforms intended to facilitate acquisition for business purposes.

CII has listed a few sectors with high potential for growth, like textiles and garments, which constitute a significant share of exports, electronic hardware, cement, iron and steel, engineering, defence and aerospace.

 

No ‘Connect’ with electronics hardware

Despite years of references to the potential of electronic hardware manufacture, there has been little action on the ground. Tamil Nadu began well with export on the annual ‘Connect’ event. In the early 2000s, there was an explosive growth in the IT, communications and telecom hardware industries in Sriperumbudur and elsewhere. Remember Nokia – Foxconn setting up world class facilities and Nokia emerging the largest manufacturer of cell phones? In quick time, this thrust was lost. Confusion over tax policy and poor industrial relations led to the failure to build on this excellent start. Several electronics units in that complex closed down.

F C Kohli, who headed TCS and triggered the IT boom, has been an ardent advocate of electronic hardware. For over two decades Kohli has been suggesting the nurture of electronic hardware education in around fifty institutes of higher learning and backing these electronic hardware engineers with high volume production of a vast range of electronic hardware and components.

 

Make in India efforts hurt

 

Such an approach also needs tweaking tax policies. I refer to the failure of doing this hurting the Make in India effort by citing the experience of the Dell Computers (DC). This computer giant has set up a unit in Sriperumbudur and produces around 3000 PCs and laptops per day. With several state governments promising free laptops for students, combined with the tremendous growth in demand for these from other sectors, one can imagine the potential for volume production. But, on a visit to this facility, I noticed a few interesting factors: the first is the modest volume of production, of around 3000 per day or around a million a year. Second, the unit provides employment to local women with a higher secondary pass who are quite nimble and efficient.

The matter of concern relates to the very poor, indigenous content: except the CD manual, the sponge and carton used for packing, other items are all imported. Foxconn imports these from Taiwan in CKD packs. Reducing the excise duty from 10 per cent to 2 per cent can trigger manufacture of several components by local units.

Another equally sad experience related to the free mixies and fans offered by Tamil Nadu not resulting in any big orders for Indian manufacturing units. For their low prices, these are imported from China, of indifferent quality.

Forbes and his team at CII should address this issue by encouraging Indian manufacturers to go for high volume production as does China.

 

High capacity, low utilisation, high prices

 

In the Indian context, even in sectors where volumes have been high, the traditional pre-liberalisation habit of cartelisation persists. We have been pointing to such practice in the cement industry: despite a handsome expansion of capacity which is under-utilised, cement prices have been manipulated by cartelisation. We have been pointing to the huge difference in cement prices by such unethical, oligopolistic cartels.

 

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