Gurgaon drives Haryana’s growth graph

Gurgaon is the leading contributor towards Haryana's economic development, say industry experts.

According to information provided by research firms such as the Associated Chambers of Commerce and Industry of India

(ASSOCHAM) and CRISIL Research, the city accounted for 23% of the total tax worth Rs 8,044 cr realised from 1.7 lakh assesses under the Haryana VAT Act 2003 during 2009-10. Gurgaon also accounted for 7% of the total tax realised under the Central Sales Tax Act 1956 with a share of Rs 285 cr of the total Rs 4,063 cr.

"Gurgaon accounts for a sizeable proportion of the total number of large, medium and small units operating throughout Haryana, total investment made in these units and employment generated by these units, thereby making the city as one of India's fastest growing commercial hubs," said D.S. Rawat, secretary general of ASSOCHAM.

According to an analysis done by ASSOCHAM, Gurgaon also accounted for 15% of the total tax collected under the Passenger and Goods Tax Act 1952 with a share of about Rs 51.88 cr.

Over 2.93 lakh people were employed in Haryana's organised private sector in 2009-10 and Gurgaon accounted for about 30% of the total workforce with over 86,200 workers.

Experts believe that by the end of this decade, Gurgaon will develop as an international financial platform to serve India's growing needs and increase its voice in global financial markets. High infrastructural growth with vast pool of IT and ITeS industries, investor-friendly policies, and highly skilled IT labour force will help the city prosper.

Sprawling shopping malls, skyscrapers comprising commercial and residential complexes together with modern infrastructure are also some factors contributing to Gurgaon's growth.

"Gurgaon accounts for a significant share of 52% of NCR's upcoming commercial office space. The percentage of planned commercial office space supply coming up in other parts in NCR will be Greater Noida with 18%, Noida with 16%, New Delhi with 6%, Faridabad with 5% and Ghaziabad with 3%," said Sudhir K. Nair, head customised research, from CRISIL Research.

Haryana also attracted 73 Foreign Direct Investment (FDI) projects worth about Rs 9,500 cr between April 2005 and December 2010 and Gurgaon accounted for about 80% of this FDI with a share of 38 projects worth over Rs 7,300 cr.

23 October 2011 in The Sunday Guardian.

Hermes sari flops in India

Even the richest Indians are reluctant to purchase for Diwali the new line of Hermes saris priced between Rs 4-10 lakh. The French luxury brand has managed to sell only six of its 28 limited edition saris launched a month ago. The saris are available exclusively at Hermes' Mumbai store. When correspondents from this newspaper visited Hermes' stores at the Horniman Circle in Mumbai and at the Oberoi Hotel in New Delhi, where orders are taken for the saris, they found them empty.

Hermes is not the only high-end foreign brand that is staring at a bleak Diwali. Other high-end brands such as Dior, Louis Vuitton, Boggi Milano and Steve Madden, with products ranging between Rs 7,000 and Rs 1 lakh are not doing great business. A visit to their showrooms in malls such as DLF Emporio, Ambience and Select City Walk in New Delhi during peak evening hours showed that they were fairly empty. Customers were not splurging the way they would normally do during Diwali.

When contacted by this newspaper, the companies refused to disclose their sales figures for the season by saying that their figures will be available when this quarter ends, that is the end of December. Their cumulative Asia figures excluding Japan are available till August. But these numbers do not quote Indian sales anywhere.

Off the record, shop assistants in many of these stores admitted that sales had not picked up. "You can see for yourself. The mall is empty," said one salesman at DLF Emporio.

Even stores belonging to high-street brands such as Paris Hilton, DKNY, Zara, Mango, Aldo and Guess, with products ranging between Rs 3,000 and Rs 50,000 were relatively empty when compared to other stores.

Will "Indianising" their products help these high-end brands capture the market? "I am not convinced that international companies will be able to attract more buyers by 'Indianising' their products. For example, we already have a successful jewellery and luxury domestic market, which cannot be replaced by foreign brands," said Abheek Singhi, retail analyst with Boston Consulting Group.

Status symbol is not enough to bring in customers. "These brands make their line of clothing and jewellery for the elite. But at the same time, an elite Indian customer is also looking for products that offer visible value, which is missing (in these products)," said Sonal Khare, merchandiser with Impulse India.

Indian designers welcome the new entrants, but believe that they will experience slow growth. "These brands have a 0.01% clientele, which is only helping them build their brand name but not helping them grow. I agree that the real market belongs to the masses, but luxury brands do not cater to them," said Anju Modi, a Delhi-based designer.

According to a recent study by CII-A.T. Kearney, the luxury market is expected to reach a value of $5.8 billion by 2015. It has witnessed a growth of 20% in 2011 compared to 2010. But experts say that this projection seems ambitious as the key challenge of reaching the target consumer has not been tackled. "High-end brands cater to a very niche market, which comprises only 2-5% of the elite class in India. We do expect a 20-25% growth rate for luxury brands. But they do not sell in India as much as they do in China," said Abheek Singhi.

Purnendu Kumar, retail analyst with Technopak India said, "Today, luxury goods are a necessity for the affluent segment in India, with a marked shift in mindset. But 20 million people buying from high-end stores does not account for even 5% of the Indian population."

The other big challenge for the Guccis and Versaces of the world is that they cannot set up mono brand outlets because of the 51% cap on FDI in single brand in retail.

Poor infrastructure is another big dampener for luxury brands. One DLF Emporio in New Delhi is nowhere close the umpteen stylish malls and high streets in China. "With taxes on luxury goods above 35% in India as opposed to just a 15% levy in China, the Indian luxury consumer would normally pick up the same product from abroad than here," said an official from the Associated Chambers of Commerce and Industry of India (ASSOCHAM).

(With inputs from Mamta Sen in Mumbai)

23 October 2011 in The Sunday Guardian.

Shops expect Diwali surge in chic brands

International garments and accessories brands are expecting a 30% surge in sales during this festive season. Experts say that India has become the most "happening" place for foreign brands.

The Associated Chambers of Commerce and Industry of India (ASSOCHAM) said that ad spends in TV and press will be up by 45% during 2011 compared to festive 2010. This will surge sales by 30-40% for foreign brands that offer home and electronic appliances, automobiles, textiles, gems and jewellery, luxury products and home essentials.

"During this festive season, especially Diwali, foreign brands are expected to register almost 30-40% of their yearly sales. Most of the international brands operate at a gross margin of 60%. Tommy Hilfiger, Marks and Spencer, Levis are some brands that have opened Indian offices which has paved a growth path for international brands. Close to 20 million people are buying products from foreign brands at the premium they offer," said Purnendu Kumar, retail analyst with Technopak, a consulting firm.

International players are happy with the way sales have increased since the last week of September.

"Diwali sales this time has picked up after the traditional shraddh period from 28 September. The one month period will contribute in excess of 10% of the year's revenue for the second quarter. Profits double for our retail segment for this period which account for more than the year's average profits," said Sooraj Bhatt brand head of Allen Solly India.

"Consumers splurge during festival season and retail growth will be one of the best during Diwali. Louis Philippe expects a minimum 12-14% of overall sales to come during this Diwali. Profits during this season will be the best as sales will come from full price merchandise," said Jacob John brand head Louis Philippe India.

"Considering it is the festive season and people indulge in exchanging gifts or buying new items for themselves, sales are bound to spurt. We expect 25% of annual sales during Diwali season for Police watches," said Haresh Chainani, managing director, Ganga Watches, which has a franchise of Police in India.

Even online portals say that International brands are attracting more people. "We have a 50-50 profit ratio for foreign and ethnic brands. We provide foreign brands which are not easily available in stores. This helps in building a strong customer base. However, during Diwali we see a surge in sales for home essentials and decor," said Trivikram Thakore, head marketing, Fashion and You, a luxury fashion portal and Deals and You.

16 October 2011 in The Sunday Guardian.

Industry calls for a reliable public transport

Travelling by buses and metro will help control traffic and pollution in the country, says the Associated Chambers of Commerce and Industry (ASSOCHAM) in its recent study titled Vision 2030 for Emerging Cities of India. A network of organised mass transport systems is essential as the number of cities with more than 10 lakh people will increase from 48 to 68 in the next two decades.

"There will be a huge demand for mass transit rail as the number of cities with population of 40 lakh and above will increase from seven to 13 by 2030. The subsequent growth explosion in these cities will account for almost 70% of India's GDP," said D.S. Rawat, general secretary, ASSCOHAM.

According to the study, Mumbai is likely to have a population of 3.3 cr by 2030, Delhi 2.6 cr, Kolkata 2.3 cr, Chennai 1.1 cr, Bangalore and Pune 1 cr each. India's total urban population is already 37.7 cr and may exceed the earlier projection of 59 cr by 2030, states this study.

Among all forms of public transport, the Delhi Metro has helped reduce over five lakh vehicles on city roads since its inception. "Metro rail has the potential to bring all-round benefits to businesses, the environment and people from all walks of life. It is evolving as an industry on its own, and creating space for new services and jobs," states the report.

"The metro rail's contribution in reducing carbon emissions in cities like Delhi and Kolkata has been immense. Reduced traffic congestion on the roads, easy connectivity to commercial hubs and office complexes and reduction of pollution will be the most evident benefits from organised mass transport," said Chandan Choubey, senior analyst of transportation and logistics from KPMG.

The ASSOCHAM study also states that the Central government should move quickly to establish the Metro as the best mass transport means.

9 October in The Sunday Guardian.

‘India is good to gifted children’

Dr Laurie Croft, a professor from the Belin Blank Center for Gifted Education, US, honours advisor and a research guide, believes that India's growth story with gifted children (she hates to refer to them as disabled) will be more successful than China's. She was in India to attend the annual general meeting of Mensa, an NGO working towards the cause of educating gifted children, and was visiting special schools in Delhi, Mumbai, Pune and Nasik.

"I can applaud the way India has worked towards this cause. It is better than what China has done. In 2008 Dr Nayaran Desai, an executive council member from Mensa, an NGO, had come to the University of Iowa for a scholarship on campus. From then onwards the University of Iowa has formed a partnership with Mensa to support them with ideas and techniques to make life less complicated for gifted children. I contribute with scholarly articles and improvised plans. Our association with Mensa guarantees a scholarship for these students to study an honours programme in several subjects from the University of Iowa," Dr Croft told The Sunday Guardian.

According to her, different Indian states have different needs: "We have started stressing on local communities so that we can plan study material and teaching methods according to their needs as talent development is immense in India."

Dr Croft herself is the mother of two gifted children who inspired her to learn more about special children: "It wasn't easy for me to consider this option until my elder daughter turned eleven. At such a young age she was learning a new language — Russian, which amazed me because she was faster than others. At 15 she left school and started college. She is a linguist and is now pursuing her PhD. Later we got to know that our younger one has brain tumour. I decided to pursue a PhD in educational leadership specialising in gifted education from the University of Tulsa, Oklahoma." "My job profile includes working with gifted children in classrooms and teaching teachers how to train them. I am also an honours advisor and help develop ideas at the University of Iowa. I have been in touch with different educators across the world trying to brainstorm and get new ideas to train these special children. I have been working for almost 13 years now," she said.

Dr Croft believes that in many ways she has the easiest job. "Many of these special children in the 4th grade in America are performing better than an average 8th grader. But they have been repeatedly told that they are gifted, which implies that things come easily to them. Unfortunately, at some point they will realise that life is tough," she explained.

She says she had a dream fulfilled during this India visit. "I saw and touched an elephant. I have always wanted to see one. And I get to see monkeys every now and then," she said with utmost excitement, almost jumping out of the sofa.

"I would recommend teachers to get appropriate training to teach gifted children. I see a lot of potential in India as the IQ level is much higher than students from other parts of the world," she concluded.

2 October in The Sunday Guardian.

Intellectual JNU hostels in sin-along mood

Live-ins are "in" for Jawaharlal Nehru University (JNU) students. Officially, JNU has separate hostels for men and women and live-ins are illegal, but tell that to the students who have been living together "openly", with even hostel wardens sometimes looking the other way, or fining them Rs 200 when they catch them. But the students are "scared" about giving their real names. "Do not name us or else we will be detained," was the common refrain. Some senior students had been detained in the past. So most of the names have been changed in this article.

"What is the harm in living together in the same room? We are adults. We are not twelve anymore and are capable of taking our lives' decisions. Plus this has been quite common here," said Janakya, who has been in three live-in relationships with three of her classmates over a period of one and a half years that she has been in JNU and is on the verge of leaving her third partner.

JNU has 18 hostels on campus, including a working women's hostel. Out of these hostels only six are for girls and the other 11 for boys.

"Hypocrisy is evident in JNU as the girls are allowed to enter boys' hostels, but the boys are not allowed to enter girls' hostels. Even some faculty members had objected to this discrimination, but no action has been taken so far. Living together is very common on our campus but it is not really allowed. However, our faculty is particular about these rules. If they find students fooling around they impose a fine of Rs 200 on them, especially when they are on attendance rounds at night," said Abhi, who is not in favour of the idea of live-ins but does not dare to say anything because of peer pressure.

"JNU has always been a world-renowned university. Why should we bother about such petty issues? We are happy with the advanced thought process we have. It is no big deal if students are staying together. We are intellectuals, unlike other college kids. We can differentiate between what is wrong and right. We even have boys staying with their male partners in the same hostel. And let's not even talk about how many one-night stands we know of," said Amrita, who has the reputation of being in the know and is said to be one the biggest gossipmongers of JNU.

The most famous in-house couple (we are allowed to give their real names), profiled by various publications, is Sree, 27, who is finishing his PhD at JNU and his girlfriend Gargi Bhattacharya, 26, who is a lecturer at St. Stephen's College. "For the past six years we have practically been living together in Sree's hostel room," said Gargi.

Sree and Gargi say that they never want to get married as they do not want to bear the burden of in-laws, children and "grief".

Other students share similar thoughts and are happy that they get to live with their partners and decide about their relationship's future based on their experience. They say that JNU makes life less complicated for couples as it gives them the "option" of living together. But they firmly believe that this does not affect their studies because they are studying in JNU to fulfill their respective goals.

2 October in The Sunday Guardian.

Difficult to fill vacancies, say firms

Only 25% of India's professionals who have already been hired are of any merit, the rest lack the skills to do their job well. This is the finding of a report by the Federation of Indian Chambers of Commerce and Industry (FICCI) and Ernst and Young. With school dropout rate as high at 57%, employers are finding it difficult to fill skilled job vacancies. The report says 90% of the country's total workforce lacks skills for gainful employment. Four out of every ten people are in the working age group.

The report says that over 40 million people are registered in employment exchanges but only 0.2 million get jobs annually; almost 80% of the workforce in rural and urban India does not have marketable skills; and the difficulty of employers in India to fill job vacancies has increased to 67% in 2011 compared to 16% in the previous year. Almost 93% of the Indian workforce is in the unorganised sector with no formal training.

"There is a critical need to upgrade the skills of India's workforce, like in Germany, which is doing well compared to the highly depressed economies of the Eurozone, primarily because of its skilled workforce," S. Ramadorai, advisor of the Prime Minister's National Skill Development Council, told The Sunday Guardian.

"It is imperative for society to legitimise vocational education and training as an equally attractive alternative to conventional degree-based education," said R.V. Kanoria, managing director of Kanoria Chemicals and Industries Limited, Delhi.

Analysts believe that India needs to gear up for internal challenges like inconsistency in infrastructure and delivery mechanisms and a larger role for sector-wise skills councils. "There are six basic steps for better implementation of skills development. They are pre-training assessment, training obtained from working on the job, certification, which guarantees that you have received skills training, placement and on the job mentoring, which leads to better productivity. Embedding appropriate training at the source will help in achieving targets and providing jobs," Pooja Gyanchandani, director, FICCI Skills Development, told this newspaper.

There are 17 Central ministries, along with the National Skill Development Corporation and State governments who provide skill development programmes. "National level strategic collaboration and co-operation of existing bodies will increase hiring levels. Skill enhancement at the individual level will lead to better trained manpower, lower attrition rates, and better matching of aspirations," added Gyanchandani.

Dilip Chenoy, CEO of National Skills Development Corporation said that the industry is coming forward to enhance awareness on skill development. While referring to organisations like Tata Steel and Delhi Metro Rail Corporation, he highlighted the impact and reach that an organisation can have towards contributing to skill development.

28 September in The Sunday Guardian.