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October - November 2007


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Business News

London Olympics: Small businesses are being frozen out

Small businesses in London are not being given a fair chance to access 2012 Olympics contracts, Syed Kamall, Conservative Euro-MP for London said today.

The Olympic Delivery Authority has refused to break down contracts into smaller chunks that would give smaller businesses a chance at competing, and the process of forming a consortium to compete for a large contract is complicated, time consuming and expensive.

Mr Kamall said:

“Small businesses must not be frozen out of the lucrative opportunities offered by the London Olympics.

“The Olympic Delivery Authority may say it wants to open procurement contracts to smaller businesses, but they are going the wrong way about it. Only larger businesses have the resources to win the big contracts as the legal process of forming a consortium is too expensive and complicated for small businesses. If the Olympic Delivery Authority was really committed to helping smaller businesses ,it would issue more smaller contracts.

“Instead of a diverse and colourful Olympics offered by a wide range of individual companies, we are in danger of ending up with a dull and uninspiring games provided by a handful of big corporations.”

Nick Winch, 2012 coordinator for the Federation of Small Business (FSB), added: “Every effort should be made to ensure that as many of the benefits of the 2012 Games as possible are reaped by small and local businesses. It shouldnít just be a feeding frenzy for the multinationals.”






INDIA-JAPAN BUSINESS SEMINAR AND BUSINESS LEADERS FORUM

KAMAL NATH CALLS FOR GREATER JAPANESE INVESTMENT IN INFRASTRUCTURE DEVELOPMENT

Mr Kamal Nath, Union Minister of Commerce and Industry, has called upon the Japanese business leader s to benefit from the investment opportunities available in the Indian economy and highlighted the enormous contribution that Japan could make for infrastructure development. “Our need for infrastructure is massive, and we estimate that in the next five years, we will need US $ 384 billion to bridge the infrastructure gap”, he informed the participants at the India-Japan Business Seminar here today. Shri Kamal Nath highlighted the lead given to Indo-Japan economic engagement through the Delhi-Mumbai Industrial Corridor Project and hoped that apart from benefiting the country’s industrial infrastructure development, it would also become a new springboard for the Japanese companies for accessing the US and EU markets.

The Minister also highlighted the tremendous strides made by India on trade front as well as in achieving a record growth in foreign direct investment (FDI) and in propelling the manufacturing revolution in the country. He invited the Japanese business leaders to look at some of the sectors with high potential in manufacturing such as textiles & apparels, food processing, chemicals & petrochemicals, automobiles, electronics & IT hardware etc.

The Indo-Japan Business Seminar was also addressed by Shri Masakazu Toyoda, Vice Minister, Ministry of Economy, Trade and Industry, Government of Japan; Shri Ajay Shankar, Secretary (DIPP); and representatives from Mitsubishi Electric, KPMG, NYK Ltd. The Seminar was jointly organised by DIPP, JETRO, FICCI, CII and Assocham.

Later, while addressing the inaugural session of the India-Japan Business Leaders Forum here, Shri Kamal Nath hoped that the Business Leaders Forum would be able to bring to the notice of the two governments the particular roadblocks being faced for doing businesses in the two countries. Shri Nath highlighted the resurgence of the manufacturing sector in India which has now become the growth driver of the economy. “The resurgence of manufacturing is visible in the sustained interest of overseas companies in establishing production centres in India. Factories for Suzuki, Mitsubishi, Toyota, Honda, Asahi and others are going online rapidly, making a range of products for domestic as well as international sales”, he said.

The Minister also noted the emergence of India as one of the fastest growing markets in the world. According to McKinsey, by 2025, India will have quadrupled its markets, with discretionary spending comprising 70% of all spending. Rural spending will increase to almost US $ 600 billion, lowering poverty to 29% of the rural population by 2025.

The Business Leaders Forum was also addressed by Shri Masaharu Kohno, Deputy Minister of Foreign Affairs, Government of Japan; Shri Fujio Mitarai, Leader of the Japanese business delegation and Shri Mukesh Ambani, Chairman/Reliance Industries and co-chair of India-Japan Business Leaders Forum.

The Prime Ministers of India and Japan had announced the constitution of the Business Leaders Forum in their Joint Declaration in December 2006 in Tokyo and today’s meeting was the first meeting of the Forum.

The Business Leaders Forum was also addressed by Shri Masaharu Kohno, Deputy Minister of Foreign Affairs, Government of Japan; Shri Fujio Mitarai, Leader of the Japanese business delegation and Shri Mukesh Ambani, Chairman/Reliance Industries and co-chair of India-Japan Business Leaders Forum.

The Prime Ministers of India and Japan had announced the constitution of the Business Leaders Forum in their Joint Declaration in December 2006 in Tokyo and today’s meeting was the first meeting of the Forum.


WORLD BANK REPORT ON CLIMATE CHANGE

India has been actively participating in the Clean Development Mechanism (CDM) of the Kyoto Protocol. Today India also has the largest number of projects under CDM, which reduce net emissions of greenhouse gases. We are following a sustainable development path by a range of policies and programmes to mitigate climate change, some of which are:

i. ensuring energy conservation and improved energy efficiency in various sectors as well as setting up of Bureau of Energy Efficiency

ii. promoting use of renewable energy

iii power sector reforms and active renewable energy programme

iv. use of cleaner and lesser carbon intensive fuel for transport

v. fuel switching to encourage cleaner energy

vi. afforestation and conservation of forests

vii. promotion of clean coal technologies

viii reduction of gas flaring

ix. encouraging Mass Rapid Transport systems

x. environmental quality management for all sectors

In one recent World Bank Policy Research Working Paper, a comparative analysis has been done of the impact of possible sea level rise due to climate change on developing countries. The Paper does not make any policy recommendations or economic judgements and is a scenario based modeling exercise. The findings, interpretations and conclusions expressed in the Policy Research Working Paper Series are, however, entirely those of the authors and do not represent the view of the World Bank.

The Research Working Paper above has made projections of vulnerability, migration and possible impacts on GDP across the developing countries, including India. The relative impacts of sea level rise on India are not as great as in other coastal countries or regions of the world because of India’s large hinterland and economic geography. In India about 0.25 – 2.5% of the population could be affected and about 0.3 -2.5% of GDP could be affected, depending on the extent of sea level rise in the range of 1-5 meters and other assumptions of the scenarios. This effect is much less than elsewhere in South Asia.

A preliminary assessment of the impacts and vulnerability to projected climate change in key sectors such as water, agriculture, forestry, ecosystems, coastal zones, health, energy and infrastructure had been undertaken by the Government at the time of preparation of India’s Initial National Communication to the United Nations Framework Convention on Climate Change (UNFCCC) during 2001-04. The projected climate change scenarios indicate increase in, and variable trend of, both rainfall and temperature in the 21st century. It is projected that quantity of surface run off due to climate change would reduce and vary across the various river basins. The initial analysis has revealed that climate change may have adverse effects in terms of severity of droughts and intensity of floods in various parts of the country. Increase in CO2 concentration; increase in temperature and variable distribution of rainfall show a mixed projection of yields of various crops across the regions. No definite trends have yet been established. Forests types in India seem to be vulnerable to the projected changes in climate. Coastal areas are also vulnerable to climate variability in varying degrees.

The Government of India is already seized of the various concerns that may arise due to climate change. The existing legislative and policy framework in various sectors of concern, together with programmes which target conservation of rivers, improvement of urban air quality, enhanced forestation, promotion of renewable energy technologies, energy efficiency etc. contribute to addressing climate change issues. Moreover, India has had, over the last 55 year of economic development, undertaken major programs addressing climate variability concerns. These include cyclone warning and protection, coastal protection, floods and drought control and relief, major and minor irrigation projects, control of malaria, food security measures and research on drought resistant crops.

A coordination committee chaired by Prime Minister called Prime Minister’s Council on Climate Change has been recently constituted to coordinate national action for assessment, adaptation and mitigation of climate change. The focus of the Committee is to:

i Evolve a coordinated response to issues relating to climate change at the national level;

ii. Provide oversight for formulation of action plans in the area of assessment, adaptation and mitigation of climate change;

iii Periodically monitor key policy decisions.

The Government has also set up an “Expert Committee on Impacts of Climate Change”.




Barclays profits

increase sharply

Barclays Bank has become the latest UK bank to post strong half-year profits, though this was offset slightly by settlements on UK overdraft fees.

Pre-tax profit at the bank rose 12% to £4.1bn, supported heavily by record earnings at its investment bank arm.

Profits at its UK retail banking business grew 9% to £651m.

Barclays said it had refunded £87m in settlement payments to customers who claimed they had been overcharged for overdraft fees.

Other bank charge refund costs announced by UK banks this week have included £79m from HBOS, £39m from Lloyds TSB and £116m from HSBC.


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