telangana

Why Agri-Equipment Companies Should Watch Telangana

On November 6, the Telangana government said it would provide 24×7 power to the farm sector for the “next five to six days”. It was part of a bigger plan. It is seeing this as a dry run to its eventual objective of providing 24 x7 power to farmers, beginning March 2018.

If that happens, and if farmers plug more into the greater supply, it could open up new opportunities for companies in the business of agri-equipment like pump-sets and drip irrigation sets.

Power availability is an issue in India everywhere, especially in rural areas. The last time an exhaustive count of power availability was done at the village level was as part of Census 2011. This was when the 10 districts that are Telangana today were a part of Andhra Pradesh.

In October 2016, these 10 districts were re-carved into 31 districts, but to stay synchronous with the data, this piece will consider them as 10 districts.

Villages in these 10 districts received 5-7 hours of electricity for agricultural use in the summer months of April to September (See Graph 1). The situation would have improved since then.

In fact, in the six-month period to September 2017 alone, Telangana increased power generation by 25%, which was the highest among all large- and medium-sized states, shows data from the Central Electricity Authority.

Villages and farmers need this incremental electricity. According to the Socio Economic Caste Census of 2011, 8 of 10 districts in Telangana each had at least one-third of agricultural land that was unirrigated, led by Adilabad (55%). This means produce on this land is largely dependent on rains. If there is greater surety of power supply, those with the means to buy, or the ability to borrow to buy, might be more inclined to invest in agricultural equipment that enable better productivity through greater mechanization and irrigation.

So, where in Telangana might these pockets of demand be? Here’s what the rural areas of these districts looked like in 2011 on five metrics that define ownership of agri-equipment and purchasing power. And there resides lines of inquiry for chief marketing officers (CMOs) of agri-equipment companies.

This data for Telangana is also available with How India Lives at the sub-district level. If you are interested in accessing this data, please write to johnraja@howindialives.com

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News in Numbers, May 6, 2016: New proposals for bank licenses, Tamil Nadu’s freebies…

10 years

What is it? The minimum number of years a resident individual should have worked in banking and finance to apply for a bank license in India, per Reserve Bank’s proposed guidelines.

Why is it important? An example of the balance the banking regulator seeks to achieve in its new set of proposals to encourage more players in the banking sector. It also proposes to issue bank licences throughout the year instead of issuing them periodically. These changes are expected to increase the reach of formal banking.

Tell me more: Large business houses are still excluded from applying for bank licenses but can hold up to 10% in banks and a financial holding structure is optional if the promoters are individuals or standalone entities and do not have other group entities. RBI will accept comments on these guidelines till June 30.

Rs 1-100 crore

What is it? The penalty for wrongful depiction of India’s map, which may include jail term of up to seven years, according to the draft ‘Geospatial Information Regulation Bill 2016’.

Why is it important? This is likely to prevent repeat of instances where social networking sites showed Indian territories (Kashmir in China and Jammu in Pakistan) as part of neighbouring countries. The draft bill makes it mandatory to get permission from a government authority before acquiring, disseminating, publishing or distributing India’s geographical data. This means firms such as Google would need to apply for licenses to run Google Maps and Google Earth in the country.

Tell me more: The bill proposes the setting up of an enforcement authority to ensure compliance of these rules.

Rs 96.7 crore

What is it? BSE Ltd’s consolidated net profit for 2015-16, a drop of Rs 155.5 crore from the previous year.

Why is it important? The drop in profits could affect its valuation as it readies itself for an initial public offering by the end of 2016 to reportedly raise Rs 700-800 crore. It would be India’s first equity exchange to get listed.

Tell me more: The board of directors of BSE approved the public listing on Thursday.

100

What is it? The number of units of free electricity promised by the J Jayalalithaa-led AIADMK in its manifesto released on Thursday.

Why is it important? It would exempt 78 lakh consumers from paying electricity bills, and comes at a time when the state’s power generation and distribution arm is reeling under debts of Rs 80,000 crore. Its power deficit was predicted to be 4.5% in 2015-16. It’s just one of the several freebies AIADMK and its rivals have promised ahead of the state elections.

Tell me more: AIADMK’s other promises include: 50% subsidy on scooters for working women, free Wi-Fi at public places and a Rs 50-crore Amma venture capital fund for first generation entrepreneurs. DMK, the other major political party in Tamil Nadu, has offered freebies ranging from tablets and laptops with 3G/4G connections, smartphones, rice and lower milk prices.

30 lakh

What is it? The number of students who could potentially appear for the second phase of nationwide common test for undergraduate medical and dental courses to be held on July 24 – some of whom might have taken the test already in phase 1, per Supreme Court’s request.

Why is it important? If accepted, this would help those who appeared for the first phase of the test on May 1, which was converted from being the All India Pre-Medical/Pre-Dental Entrance Test (AIPMT) to an all-India common entrance exam on April 28. The students may not have prepared seriously for AIPMT as it offered them only 15% seats allotted under the all-India quota and may have been banking on state entrance exams.

Tell me more: The court reiterated that private medical colleges and its associations cannot conduct any entrance exams for medical courses while there is some uncertainty if states can do the same.

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News in numbers, Jan 21, 2016: 2015 the hottest year, Bacha Khan University massacre…

 

150 million tonnes

What is it? Plastic waste in the oceans currently, according to estimates by the World Economic Forum and the Ellen MacArthur Foundation.

Why is it important? Use of plastics and plastic packaging have negative effects on the environment (degradation of natural systems, greenhouse gas emissions) and human beings (can cause cancer, birth defects, genetic changes). If this trend continues, the report says there would be 1 tonne of plastic for every 3 tonnes of fish in the ocean by 2025 and by 2050, there would be more plastics than fish by weight.

Tell me more: A minimum of 8 million tonnes of plastics, which is equivalent to one garbage truck per minute, is being leaked into the ocean every year.

 

60.3%

What is it? Average capacity utilization of power plants in India in November 2015. It has declined from 65.7% from a year ago.

Why is it important? The low usage has prompted government to allow power plants to sell spare capacity via electricity exchanges. This is likely to reduce the burden of fixed charges, which state distribution companies (discoms) have to pay as a component of the tariff. With the new rule, while the fixed charges would still apply, the profits from sale of idle capacity would be shared equally among power producers and buyers.

Tell me more: Generating stations have been running below capacity as the poor financial health of discoms have prevented them from buying power. State electricity boards, which run the discoms, owe nearly Rs 4 lakh crore to the banks.

 

0.90°C

What is it? The degree by which the average temperature across global land and ocean surfaces in 2015 was above the 20th century average, according to the National Centers for Environmental Information (NOAA).

Why is it important? That makes 2015 the hottest year on record. It surpassed the previous record of 0.16°C set in 2014. 15 of the 16 hottest years, since record-keeping was started in 1880, belong to the 21st century. It’s an indicator that the effects of global warming could be larger than expected, given the rapid pace at which temperatures are soaring. The phenomenon of El Niño (the occasional warming of waters in the central and eastern Pacific Ocean) was also one of the main factors for the extreme conditions.

Tell me more: The deviations recorded in the global average temperature on land and sea surfaces separately, were the highest ever (since there have been records).

 

$27-28

What is it? Prices of the global benchmarks for crude oil. (West Texas Intermediate – is trading at $26.55 a barrel and Brent at $27.87 per barrel)

Why is it important? Both hit their 13-year lows and have fallen 20% since the beginning of this year. This is largely because of a glut in oil production due to oversupply and tepid demand. Growth in consumption of oil by China, which reported weak economic numbers on Wednesday, accounted for 43% of the world’s oil consumption growth. And, since it is making a transition from a manufacturing-led economy to a service-led one, its consumption of oil has slowed down, thus affecting crude oil prices negatively. Iran’s freedom from sanctions has made it re-enter the global oil market, which is likely to push oil prices down further.

Tell me more: In its January report, the International Energy Agency has said that this supply-demand mismatch will continue until the end of 2016, making it the third straight year where supply would exceed demand by 1 million barrels per day.

 

20

What is it? Number of people killed in a militant attack by a splinter group of the Pakistani Taliban at Bacha Khan University in Pakistan on Wednesday.

Why is it important? This comes almost a year after the Pakistani Taliban militants murdered 150 students and teachers at a school in Peshawar. Shows Pakistani authorities have much to do to counter terrorism, despite a 50% decrease in civilian deaths from terrorist violence in 2015 from the previous year. Khalifa Omar Mansoor, the commander of the faction of the Pakistani Taliban which was responsible for the Peshawar attack, said he was the one who ordered the university attack too. However, Tehrik-e-Taliban, which claims to represent Pakistan’s main Taliban groups, issued a statement disassociating itself from the attack and also, condemning it.

Tell me more: Four gunmen, who slipped into the university campus using the winter fog as shield, stormed into classrooms and dormitories and fired bullets at students and teachers. All the four have been killed.

 

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News in numbers, Dec 1, 2015: India’s Q2 GDP growth, pending patent applications…

 

7.4%

 

What is it? Rate at which the Indian economy grew in the July-September quarter of 2015-16.

 

Why is it important? It was 7% in the April-June quarter. It is buoyed by a 9.3% growth in manufacturing and a 6.7% increase in electricity in the September quarter. This provides a boost to the Indian government, which is trying to revive stalled projects, attract foreign investments to bring back momentum to economic recovery. Some believe the GDP numbers may prompt the Reserve Bank of India to maintain key interest rates in its fifth bimonthly monetary policy on Tuesday.

 

Tell me more: Despite a 15% drop in monsoon rains, farm output grew at 2.2% in the second quarter of 2015-16 compared to 1.9% growth in the previous quarter.

 

2.5 lakh

 

What is it? Number of patent applications pending due to shortage of manpower, according to Commerce and Industry Minister Nirmala Sitharaman in the Parliament on Monday.

 

Why is it important? As it is, India scores poorly on patents. The number of patents granted per million population (under the Patent Cooperation Treaty) is 1.5 for India compared to China’s 11.7, USA’s 149.8 and South Korea’s 201.5. The backlog is likely to shrink. The government is in the process of filling 459 vacant posts of examiners of patents and designs and has created 263 contractual posts to fill in for the same.

 

Tell me more: The Patent Cooperation Treaty provides a unified patent filing process and helps applicants in seeking protection internationally for their inventions.

 

6.67%

 

What is it? Share of higher educational institutions in India that have women in leadership positions, according to a report.

 

Why is it important? Shows that India has a long way to go in terms of gender parity. This percentage number compares poorly with the equivalent numbers for Australia (21%), US (18%) and the UK (17%).

 

Tell me more: Across all the seven All India Institutes of Medical Sciences, 31 National Institutes of Technology and six Indian Institutes of Science Education & Research, only the NIT-Puducherry has a woman director. The report, prepared by management consulting firm EduShine Advisory Group looked at all higher educational institutions including central, state, deemed varsities, and institutes of national importance.

 

5

 

What is it? Number of currencies that will be in the International Monetary Fund’s (IMF) basket of reserve currencies, with the inclusion of China’s Yuan on October 1, 2016.

 

Why is it important? This means the yuan would be more widely used in international transactions and with this, it may become cheaper for China to borrow money and it may help stabilise its currency. Analysts say this could also mean that the global economy would be much more exposed to the Chinese economy. The other reserve currencies in the basket are the US dollar, the euro, the yen and the pound.

 

Tell me more: The last change to the basket of reserve currencies was made in 2000 when the euro replaced the German mark and the franc.

 

$200 million

 

What is it? Reported deal size of online classifieds platform Quikr acquiring real estate portal CommonFloor.com, though neither of the two have confirmed the development.

 

Why is it important? Once confirmed, this would be the first large consolidation deal in the online property selling space. With this deal, Quikr would be able to strengthen its newly launched vertical, QuikrHomes, an online real estate portal.

 
Tell me more: This November, Quikr announced that it had acquired Indian Realty Exchange, a real estate agent aggregator, for an undisclosed amount.

 

 

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