FDI is rising, but not visibly in core ‘Make in India’ sectors

This piece originally appeared on Livemint.com

 

The last two years have seen a robust increase in inflows of foreign direct investment (FDI), particularly in the form of equity subscriptions. However, much of the increase is happening in the services sector, and not the manufacturing sector, which the government has made the centrepiece of its ‘Make in India’ campaign.

 

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News in Numbers – September 7, 2015

News In Numbers: September 7, 2015

 

27%

The extent by which India’s gross domestic product (GDP) would expand if India were to have as many women workers as men workers, according to International Monetary Fund estimates. Speaking at the launch of W20, a gathering of women leaders from the world’s largest economies, including India, IMF chief Christine Lagarde said the equivalent numbers for US and Japan were just 5% and 9%, respectively. Though women account for 48.5% of India’s population, gender inequality exists in most dimensions. However, recently, India has managed to bring down gender parity in schools, where the girls-to-boy ratio in primary classes is 1.02 and 0.94 in secondary schools. Overall, India ranks a poor 127 in the United Nations Gender Inequality Index for 2013.

 

25%

Percentage of respondents in a survey by industry body Ficci that are likely to plan capacity addition in manufacturing in the next six months. The current subdued investment in manufacturing is mainly attributed to delay in clearances, poor demand and high interest rates. The respondents were from 386 manufacturing units of all sizes. The survey also says that hiring will remain muted, with 79% of respondents not planning to add workers in the next three months. The number of jobs created in manufacturing declined by 4% in 2012-13, over 2011-12, according to Assocham Economic Research Bureau.  Although the growth of Indian manufacturing has been sluggish, it is the only country (besides Vietnam) that has showed expansion in August from the previous month among emerging market Asian economies.

 

10%

The percentage increase in entry-level salaries of engineering graduates who will join TCS and Cognizant Technology next year. This is the first time IT companies have increased salaries of entry-level engineers in about seven years, which was stagnant at about Rs 3 lakh per year. Brokerage firm Kotak Institutional Equities estimates that this would impact the companies’ profit margins by 0.25 percentage points in 2016-17 and their earnings per share by 1-2%. IT industry grouping Nasscom estimates technology majors will hire only 30,000 people in 2015-16, 13% fewer than 2014-15. With IT companies looking at automation and other ways to reduce cost, the excess supply of engineering graduates is likely to remain a problem.

 

Rs 37.22 crore

The amount Prime Minister Narendra Modi’s overseas trips have cost the exchequer, between June 2014 and June 2015. Although Modi visited 20 countries, expenses related to 16 countries were provided to an RTI (Right to Information) application. About 40% of this amount was spent on two trips: Australia and the US. In his first year as Prime Minister, Modi allocated 14.5% of his tenure to visit 17 countries, while his predecessor Manmohan Singh spent 12.9% of his tenure to visit 12 countries in his first year. Of the total inflow of foreign investment in 2014-15, India received about 26.1% foreign direct investment from 12 countries visited by Modi in the same period. Indian companies invested over 53% of the total outflow of foreign investment in 2014-15 in these 12 countries.

 

12,000-14,000

The estimated number of leopards in India, according the first ever census of the country’s leopards. The census did not cover Gujarat, parts of Rajasthan, and eastern and northeastern parts. Leopards were counted using the same methods as those employed for estimating India’s tiger population: camera-trapping and gathering other evidence of their presence. Madhya Pradesh has the highest estimate of leopards (1,817), followed by Karnataka (1,129) and Maharashtra (905). The lead scientist of the tiger census, who presented the leopard figures last week, said there was no way of knowing whether their numbers have increased or decreased. A recent study by three wildlife scientists estimated a 70-80% decline in the leopard population in the last 100 years.

 

 

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News In Numbers – August 18

News In Numbers: August 18

 

211 vs 175

India’s largest airlines by market share, IndiGo, has placed an order to purchase 250 Airbus A320neo aircraft, in a deal worth $26.55 billion at list prices. This is the largest-ever order for Airbus in terms of number of planes. The IndiGo order will help Airbus open its lead over rival Boeing in the Indian market. Data from the aviation regulator shows Airbus had 211 aircraft in operation in India, against Boeing’s 175. Globally, though, with revenues of $233 billion in 2014, Boeing was bigger in size than Airbus ($175 billion), primarily because the former’s sales include bigger and more expensive airplanes.

 

Rs 7,957 crore

The extent to which power distribution companies in Delhi reportedly overstated accumulated losses over the years. The estimate has been arrived at by the auditor to the government in a forthcoming report. If true, the report is a major boost to the Aam Aadmi Party government in Delhi, which made high power charges in the national capital one of the main points in its electoral campaign. The report gives room to the AAP government to press for a reduction in power rates. According to the report, the three discoms, two from the Anil Ambani Group and one from the Tata Group, bought costly power, ‘suppressed’ revenue and gave undue favours to group firms.

 

$75 billion

The amount the United Arab Emirates (UAE) has committed to invest in India as part of an infrastructure fund created by the two countries. This fund seeks to invest and expand India’s network of railways, ports, roads, airports and industrial corridors. The two countries also plan to increase their trade by 60% in the next five years. India received $239 million as foreign direct investment (FDI) from the UAE in 2013-14, and $1.31 billion between 2009-10 and 2013-14. India received $34 billion as FDI in 2014.

 

2

The number of verticals that are reportedly being created by the Central Board of Excise and Customs (CBEC) to implement the proposed Goods and Services (GST) Bill. Besides these two verticals (one for performance management and the other for taxpayer services), there are various sub-groups working under the CBEC, and state officials are working on the law and procedures. The GST Bill, which is supposed to merge all central and state taxes into a single tax rate, was passed by the Lok Sabha but not by the Rajya Sabha, where the NDA is in a minority. A few media reports, quoting anonymous sources, say the government is considering a special session of Parliament in September to pass the GST Bill.

 

Rs 143 crore

The Supreme Court has asked the Central government to update it about the three-member committee it had asked to constitute to ensure the implementation of its order on government advertisements. This May, the court laid down certain guidelines for government advertisements to avoid misuse of public funds for glorifying the ruling party, and had suggested only the photographs of the President, Prime Minister and Chief Justice of India be used in government advertisements. An NGO had filed petitions in the Supreme Court in July to initiate contempt of court proceedings against the Delhi government (alleging it had earmarked Rs 526 crore for government ads in 2015-16) and the Tamil Nadu government for putting out ads that glorified their respective leaders. Previously, the Congress-led UPA government spent Rs 143 crore to place 84,733 advertisements in print publications between 2008-09 and 2012-13 related to the birth and death anniversaries of 15 leaders.

 

 

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News In Numbers – July 16

News In Numbers: July 16

 

7

India’s goods exports fell for the seventh consecutive month in June, by 15.8% to $22.3 billion, making it more challenging for Prime Minister Narendra Modi to achieve his target of $900 billion in exports by 2020. Of the top 30 broad export categories, as many as 16 reported a decline in June 2015, compared with June 2014. India had missed its export target of $340 billion in 2014-15 by 11.5%.

 

Rs 50 crore

The total corpus of the Dalit SME (small and medium enterprises) Fund. The fund, which was launched in 2013, supports the entrepreneurial initiatives by people from scheduled castes and scheduled tribes. Launched by the Dalit Indian Chamber of Commerce and Industry (DICCI), the fund was hoping to raise Rs 500 crore over the next 10 years. It has, so far, managed to raise only 10% of that amount due to a lack of interest from financial institutions. DICCI has around 3,000 millionaire Dalit members, with about a third running businesses whose turnover exceeding Rs 100 crore.

 

$15.3 billion

About 100 Indian companies have invested $15.3 billion and created about 91,000 jobs in the US. The survey says Indian companies have “operational presence” in all 50 states in the US, with the highest concentration in New Jersey, California and New York. Texas has received the highest Indian foreign direct investment. The IT, ITeS and telecom sector is the dominant one, accounting for two out of five companies. However, in 2011 and 2012, India’s investments in the US amounted to less than $1.5 billion, and an outflow in 2013.

 

20

Of the top 1,000 rank holders who wrote the JEE (Advanced) Examination, only 20 have opted for a new IIT campus, with the rest flocking to the older ones or the National Institutes of Technology. All those 20 students have chosen IIT-Hyderabad. In the broader set of top 2,000 rank-holders, 29 students opted for five new IITs. In other words, the other five IITs did not attract a single student from the top 2,000. Among older IITs, the Bombay campus continues to be the most preferred institution, and computer science and engineering the most preferred course.

 

102,673

Number of students from India enrolled at all levels in the US in 2013-14, or a share of 11.6% among international students in the US. That was second only to China, which leapfrogged India as recently as 2009-10 and now accounts for 31% of students in the US. According to an HSBC education survey of 16 countries released on Wednesday, India had the highest proportion of parents, at 88%, who were willing to send their children abroad for post-graduate studies. China was joint third, with 82%.

 

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