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Foreign direct investment (FDI) inflow rose by more than 100 per cent to US$ 4.66 billion in May 2011—the highest monthly inflow in 39 months—according to the latest data released by the Department of Industrial Policy and Promotion (DIPP).
The Income Tax Appellate Tribunal (ITAT) has ruled that payments to a foreign company for uploading banner advertisements on portals are not liable to be taxed in India. |
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| Warm regards, |
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Aparna Dutt Sharma
CEO
India Brand Equity Foundation |
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Focus: Consumer Goods |
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In one of its largest investments in India in a decade, consumer goods firm, Procter & Gamble (P&G), has invested Rs 345 crore (US$ 77.52 million) in its unlisted arm P&G Home Products. Confirming the investment, a P&G spokeswoman said the money will go into reaching out to "more consumers, in more parts of India, more completely".
Significantly, rural Indian households are spending more on consumer goods like durables, beverages and services than five years ago, according to the household consumer expenditure survey for 2009-10, released by the National Sample Survey Office (NSSO). The survey showed that monthly per capita expenditure (MPCE) in rural India was Rs 953.05 (US$ 21.42) in 2009-10, an increase of 64.6 per cent from 2004-05.
Further, the haircare business of Henkel India, sold by German parent Henkel AG to group subsidiary Henkel Adhesives, is looking at strengthening its presence in the competitive salon market in India, which is currently dominated by players such as Lóreal and P&G. The unit has added a mass-market brand called Indola to its list in order to target the lower-end of the salon market. The salon market in India, estimated at Rs 300-400 crores (US$ 67.32-89.76 million), is growing at around 15-20 per cent per annum. | |
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Focus: Information Technology (IT) |
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Gold loan company, Manappuram Finance, has engaged IBM in a 10-year multi-million dollar deal to transform its IT systems to support the company's aggressive growth plan. The IT services deal would help the company deliver superior customer service in a highly commoditised market, according to Mr V. P. Nandakumar, Chairman, Manappuram Group of Companies.
Significantly, IT firm NIIT Technologies has secured an infrastructure management services order from Eurostar, the high-speed passenger service between the UK and mainland Europe. The five-year contract runs into multi-million pounds, according to the company. The order involves managing and monitoring Eurostar's entire IT infrastructure including desktops, servers and the network.
Further, HCL Technologies has announced the opening of a co-innovation lab in Singapore with American pharmaceutical firm Eli Lilly to develop new technologies and solutions specifically for the drug maker. The HCL-Eli Lilly Co-Innovation Lab is HCL's "first single-client focused" lab. | |
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Interview: Craig O Morrison, President & CEO, Momentive, on the company's plans and the India focus |
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"We are looking at places such as India where the growth is sustainable at 15-20 per cent. We want to invest here both in terms of infrastructure and manpower...We have a manufacturing unit in Chennai where we invested $20 million... We have also set up an R&D centre in Bangalore to tap the Indian intellectual capabilities and built products for the global markets. Intellectual base of India is recognised worldwide and companies are looking at leveraging this to support their global business.
Overall, we are very excited about the opportunities to grow our business in India and we will continue to look at investments to bring in new technology and products for our customers." | [More] |
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Interview: Philip Lynch, Chief Executive Officer, Nomura Asia Holding, on India being the 'place to be' for long-term investors |
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"We're bullish on Asia and India is central in our scheme of things. Although Chinese companies are export-driven, some of the Indian companies are more global than their Chinese counterparts. India might actually benefit from a recovery in the US and Europe, given the exposure of some Indian companies to those countries. We're already seeing serious long-term investors scouting for investment opportunities in Asian markets. India will be a big beneficiary of this trend.
...I am not saying that next year or year after that will be particularly smooth sailing for Asian countries. But then, if you want long-term opportunities, Asia, in general, and India, in particular, are the places to be." | [More] |
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| Policy/Corporate Briefs |
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| FDI inflow rises to 39-month high in May 2011 |
| Foreign direct investment (FDI) inflow rose by more than 100 per cent to US$ 4.66 billion in May 2011, up from US$ 2.21 billion a year ago, according to the latest data released by the Department of Industrial Policy and Promotion (DIPP). This is the highest monthly inflow in 39 months. |
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| Payments to foreign companies for uploading ads not taxable: Income Tax Appellate Tribunal |
| Payments to a foreign company for uploading banner advertisements on portals are not liable to be taxed in India, the Income Tax Appellate Tribunal (ITAT) has ruled in an appeal filed by software company Yahoo India. The appeal was against the order of the Income-Tax department which held these as royalty payments. |
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| Mobile transactions to soar in India: BCG |
| Payments and banking transactions through mobile phones in India are expected to touch US$ 350 billion by 2015, according to The Boston Consulting Group (BCG). This will provide banks, telecom operators, device makers and service providers an opportunity to earn a fee income of US$ 4.5 billion. |
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| Life Technologies invests $3 million in distribution hub in Bangalore |
| Biotechnology firm, Life Technologies, has invested around US$ 3 million to open a distribution hub, which the firm expects would propel its business in India by 40 per cent in 2011. The center will distribute products across the entire country, reducing the time taken for delivery from 45 days to two days. |
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| Gilead in pact with domestic pharma firms |
| US-based pharmaceutical company Gilead Sciences has extended its partnership with four domestic drug companies—Ranbaxy Laboratories Limited, Hetero Drugs, Matrix Laboratories and Strides Arcolab Limited—to produce and market three new HIV/AIDS drugs. This is in line with a rising trend among global multinational pharmaceutical companies to partner with Indian generic drug makers to sell low-cost versions of their patented products under licence agreements. |
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| Pfizer, Ranbaxy tie up with ITC to sell over-the-counter products in rural areas |
| Drug-majors Ranbaxy Laboratories Limited and Pfizer Inc have formalised a partnership with fast-moving-consumer-goods (FMCG) company ITC Limited to tap the rural markets for their over-the-counter (OTC) products. The domestic OTC products market is pegged at over Rs 4,000 crore (US$ 898.98 million), growing at 12-14 per cent, according to industry sources. |
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| Tata BP Solar first co to commission a MW scale plant |
| Tata BP Solar India Ltd, a joint venture (JV) of Tata Power and BP Solar, became the first company to install and commission a megawatt scale solar power plant under the Rooftop and Other Small Solar Power Generation Plant scheme under the Jawaharlal Nehru National Solar Mission (JNNSM). This is a milestone in the rapidly developing Indian solar story, with the plant being put up in a record time of 150 days, according to Mr K Subramanya, CEO, Tata BP Solar. |
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| International Finance Corporation to invest $150 million in water management, water treatment projects in India |
| The International Finance Corporation (IFC) is planning to invest about US$ 150 million in water management and water treatment projects in India. The investment is to be done over the next two to three years. |
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