India Scan: External IEEE Strategic Planning and Research Providence More, Manager of Strategic...

India Scan: External

IEEE Strategic Planning and Research

Providence More, Manager of Strategic Planning & Competitive Intelligence

March 2008

IEEE Strategic Planning and Research/P. More/April 2008

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©2008 The Institute of Electrical and Electronics Engineers, Inc.


Part I

General Information


India at a GlanceOfficial Name: Republic of India Capital: New Delhi Government Type: Federal RepublicChief of State: Pratibha Patil, PresidentPopulation: 1.13 billionArea: 1.27 million square miles; about one-third the size of the U.S.Languages: Hindi, national language; 14 other official languages; English, for national, political, and commercial communication GDP Per Capita: $3,800Climate: Mainly tropical in Southern India but temperatures in the north range from sub-zero degrees to 50 degrees Celsius. There are well defined seasons in the northern region: winter (Dec - Feb), Spring (Mar - Apr), Summer (May - Jun), monsoons (Jul - Sep) and autumn (Oct - Nov). Time zone: GMT +5.5 hours. Currency unit: Indian Rupee (INR), 100 paise=1 INR. Coins in vogue: INR 1, 2 and 5. Currency notes: INR 5, 10, 20, 50, 100, 500 and 1,000. Literacy rate: 65.38 per cent (Kerala has the highest literacy rate of 90.92 per cent). Total Population: [61%] Male: [73%]; Female: [48%] State Religion: Secular State - there is no state religionMajor religions: Majority are Hindus, though a significant number are Muslims, Christians, Sikhs, Buddhists and others. International airports: Ahmedabad, Amritsar, Bangalore, Chennai, Goa, Guwahati, Hyderabad, Kochi, Kolkata, Mumbai, New Delhi, Thiruvananthapuram. Major ports of entry: Chennai, Ennore, Haldia, Kolkata, Kandla, Kochi, Mormugao, Mumbai, New Mangalore, Paradip, Tuticorin and Vishakhapatnam. Web site: India.gov.in

Source: ibef.org


India at a Glance (Cont’d)

Independent Judiciary– Supreme Court - highest judicial authority in India– High Court - Head of judicial hierarchy in the State

Fundamental Rights– Guaranteed by the Constitution

Directive principles of State Policy– Promotion of peoples' welfare in a social order

Union of India– 28 Federal States and 7 Union Territories

Parliament– Two Houses:

Lok Sabha (Lower House) Rajya Sabha (Upper House)

Source: KnoWerX Education (India) Private Limited, ASAE India Study Mission Feb 2008


Where India Ranks in the World

Population – 2ndMost populous democracy – 1stLand area – 7thLargest economy globally, based on purchasing parity – 5thGross domestic product – 10thGross Domestic Product in Asia – 3rdMarket among emerging nations – 2ndActive duty military – 3rdMuslim population – 3rdHindu Population – 1stCarbon dioxide emissions – 5th

Source: The Atlanta Journal-Constitution/ajc.com, 26 Feb 2006


Interesting FactsWorld's second largest small car market (Nano to be sold at $2,500 USD)One of only three countries that makes its own supercomputers one of six countries that launches its own satellitesOne hundred of the Fortune 500 have R&D facilities in IndiaHas the second largest group of software developers after the U.S. Lists 5,000 companies on the BSE (only NYSE has more)Is the world’s largest producer of milk and milk products and the second largest producer of food including fruits and vegetables

Source: SHRM, ASAE India Study Mission Feb 2008


Emerging Market Stock MarketsCountries like India have made unprecedented gains in income, wealth, and modernization. Nevertheless, a heated debate rages about the fairness and the costs of recent gains. The stock market appreciation in the BRIC countries (Brazil, Russia, India, and China) is based in part on the notion that these countries are on a fast path to convergence with the industrialized world. A collapse in stock market values, which are little understood by the average citizen, could weigh on the side of the opponents of reform. Except possibly in India, there is little sign that the commitment to fast growth is weakening. Still, the stock markets in the BRIC countries, which have risen about 2.5 to 4.5 times their 2005 value, are high risk and bear watching (Chart 9). Should these markets come down to earth, the consequences could be far reaching.

Source: Straight Talk, U.S. and Global Economies, The Conference Board, January 2008


Indian TradeTotal Trade: Total bilateral trade in 2006 was $31.8 billionU.S. Exports to India in 2006 increased to $10 billion, a 25% increase from the previous yearImports from India in 2006 totaled $21.8 billion, a 16% increase from the previous yearFDI to India in 2006 was roughly $5 Billion it tripled in 2007 to about $15 billionFDI outflows from India in 2007 estimated at $15 billion



Border IssuesPakistan: has fought three wars and disputes control of Kashmir, also at odds over sharing of Indus River waterChina: shares a militarized border, disputes ownership of portions of Kashmir and claims China gave nuclear power technology to PakistanNepal: has strict border policies to keep out Maoist insurgents working to overthrow the Nepalese monarchyBhutan and Myanmar: want cooperation to keep separatists in Nagaland and Assam from hiding in remove border areas.Bangladesh: supported Bangladesh when it broke away from Pakistan but has some border issues, also objects to easy movement of people and illegal trade across the borders

Source: The Atlanta Journal-Constitution/ajc.com, 26 Feb 2006


ChallengesNeed for technological upgrade

Inadequate infrastructure: roads, power, water

Bureaucratic mindset

Regulatory and foreign investment controls

High fiscal deficits

Slow Judicial & administrative processes


IEEE Strategic Planning and Research/P. More/gl: March 2008

Part II

Demographic Information


Part II

Part A. Population


India’s Population Distribution is Typical of Many Developing Countries, is Changing

India is following the demographic transition pattern of many developing countries, moving from initial levels of "high birth rate, high death rate" to its current intermediate transition stage of "high birth rate, low death rate." – This “intermediate transition stage” leads to a high population growth

rate, before graduating to levels of "low birth rate, low death rate.“

The age distribution of India’s population is projected to change by 2016. – The population below 15 years of age will decline to 28 percent by

2016. – The population between 15 and 59 years will increase to nearly 64

percent by 2016. – The age group of 60 plus years will increase from 7 percent to nearly

9 percent by 2016.

Source: India Rising Growth, Goldman Sachs Economic Research paper, January 2007.


Key Population Indicators

Population Total (estimate for March 10, 2008): approximately 1.13 billion peopleBirths per 1,000: 24Deaths per 1,000: 8Rate of Natural Increase (Percent): 1.6 Projected Population (2025): 1,391,200,000 Projected Population (2050): 1,747,300,000 Projected Population Change, 2007 to 2050 (%): 54 Infant Deaths per 1,000 Live Births: 58Literacy Rate: 79.9%Unemployment Rate: 7.8%

Sources: CIA World Fact book, India Census (2001), US Census


Key Population Indicators (Cont’d)

Rural Population (2001 Census): male: 381,668,992; female: 360,948,755Population Under the Poverty Line (%) (2006 estimate): 22% Net Migration Rate (2007 estimate): -0.05 migrant(s)/1,000 population Sex ratio (2006 estimate): – At birth: 1.12 male/female– Under 15 years: 1.098 male/female– 5–64 years: 1.061 male/female– 5 years and over: 0.908 male/female– Total population: 1.064 male/female

Life Expectancy at Birth (2007 estimate):– Total population: 68.59 years– Male: 66.28 years– Female: 71.17 years

Total Fertility Rate (2007 estimate): 2.81 children/woman

Sources: CIA World Fact book, India Census (2001), US Census


Population Distribution in 2025


Part II

Part B. English Speaking Population


India has a Large English Speaking Population

India has the largest English-speaking population in the world. – Ten years ago the United States held that record.

English speakers in India are estimated to be in the range 9% (100 million) to 33% of India’s total population (350 million).

In 1997, a survey conducted by India Today suggested that about a third of India’s population has the ability to carry on a conversation in English.

The number of English speakers varies with age. There are more English speakers among middle-class younger Indians than any other demographic group.

Source: “Subcontinent Raises Its Voice,” The Guardian, November 30, 2004; “India: World’s Second Largest English Speaking Country,” TESOL-INDIA.


Part II

Part C. Middle Class Population


Defining India’s Middle Class

According to the Indian National Council of Applied Economic Research, the term "middle class" applies to those earning between $4,000 and $21,000 a year ($20,000-$120,000 in purchasing power parity terms).

– However, this definition suits only about 60 million (under 6%) of India’s population.

Other studies define India’s middle class much more broadly.

– A recent study by CNN-IBN suggested a "simple consumer-based criterion" for membership of the middle class: ownership of a telephone, a two or four-wheel (motorized) vehicle, and a color television.

– By this definition, India’s middle class makes up nearly 200 million people (approximately 20% of the population).

Source: “India’s Middle Class Failure,” Prospect Magazine, September 2007.


Defining India’s Middle Class (Cont’d)

A May 2007 McKinsey report “The Bird of Gold: The Rise of India's Consumer Market” classified India’s middle class population into two groups: – “Seekers:” earning between 200,000 and 500,000 rupees ($4,376-

$10,941), – “Strivers:” with incomes of between 500,000 and 1 million rupees

($10,941-$21,882).

The report believes that these two groups will constitute India's huge new middle class.

While their incomes would place them below the poverty line in the United States, things are much cheaper in India. When the local

cost of living is taken into account, the income of the seekers and strivers looks more like $23,000 to $118,000, which is middle class by most developed-country standards.



Defining India’s Middle Class (Cont’d)

“Seekers” range from young college graduates to mid-level government officials, traders, and business people. – They enjoy a lifestyle that most of the world would recognize as middle

class and typically own a television, a refrigerator, a mobile phone and perhaps even a scooter or a car.

– Although their budgets are stretched, they scrimp and save for their children's education and their own retirement.

“Strivers,” the upper end of the middle class, tend to be senior government officials, managers of large businesses, professionals, and rich farmers. – Successful and upwardly mobile, they are highly brand-conscious,

buying the latest foreign-made cars and electronic gadgets. – They are likely to have air conditioning, and can indulge in an annual

vacation, usually somewhere in India.



India’s Middle Class is Growing

Although definitions of India’s middle class differ, most sources acknowledge that this population is growing.

– One source believes that by 2025 India’s middle class will include 583 million people (41 percent of the population).

At the same time, India’s middle class households will see their incomes collectively balloon to 51.5 trillion rupees ($1.1 billion).

– This figure is 11 times the level of today and 58 percent of India’s total income.



Economic Growth Breeds Income Growth and the Power of India’s Expanded Middle Class

India’s economic growth, increased spending power, and the growth of India’s middle class reinforce one another.

Because India's economic growth has accelerated significantly over the past two decades, so too has the spending power of its citizens.

With rising incomes, household consumption has soared and a new Indian middle class has emerged.

Middle-class Indians will trigger explosive growth in the country’s consumer market, pushing it to $1.5 trillion (four times the present $380 billion).

Source: “Next Big Spenders: India’s Middle Class,” Business Week, May 19, 2007.


Income Growth Encourages Choice-Based Spending and Soaring Consumption

As the income growth rolls across Indian society, a huge shift is under way from spending on necessities such as food and clothing to choice-based spending on categories such as household appliances and restaurants.

– Middle-class Indians’ discretionary spending will represent 70% of all spending by 2025, compared with just 39% now.

– Households that can afford discretionary consumption will grow from 8 million today to 94 million by 2025.

This soaring consumption will vault India into the premier league among the world's consumer markets.

– Today its consumer market ranks 12th; by 2025 it will surpass the size of Germany's consumer market, making it almost as large as Italy's market.

Source: “Next Big Spenders: India’s Middle Class,” Business Week, May 19, 2007.


Key Income Indicators

Source: "Country Data, Demographics and income India (February 2008)," Economist Intelligence Unit. * All units in LCU and billions, unless otherwise noted.

Title 2006 2007 2008 Source

GDP per head (US$, mil.) 842.4 1020.0 1230.0 Derived from Central Statistical Organization, India

Private consumption per head (US$, mil.)

475.2 578.0 684.0 Derived from Central Statistical Organization, India

GDP per head ($ at PPP) 2504.5 2730.0 2960.0 EIU calculation

Real GDP growth per head (% pa)

7.848 6.3 6.0 Derived from Central Statistical Organization, India

Personal disposable income 32593.3 36374.4 40410.5 CMIE, Centre for Monitoring Indian Economy, Economic Intelligence Service

Personal disposable income (US$, mil.)

719400.0 880000.0 1056500.0 CMIE, Centre for Monitoring Indian Economy, Economic Intelligence Service

Real personal disposable income (US$ at 2005 prices, mil.)

693390.0 724500.0 763500.0 Derived from CMIE, Centre for Monitoring Indian Economy, Economic Intelligence

Service


Key Income Indicators (Cont’d)

Source: "Country Data, Demographics and income India (February 2008)," Economist Intelligence Unit.

Series Title 2006 2007 2008 Source

Real personal disposable income (% change)

10.7 4.5 5.4 Derived from CMIE, Centre for Monitoring Indian Economy,

Economic Intelligence Service

Average real wage index (LCU, 2005=100)

102.7 105.7 107.9 EIU calculation

Average real wages (% change) 2.7 2.9 2.1 Derived from ILO labor statistics


Part II

Part D. Working Population


India’s Working Population is Large and Growing

In 2001 the total size of India’s working population was 400 million, or 40% of the country’s population.(1)

For the first time since the country’s independence, employment has grown at a faster rate than population rate during the five-year period between 2000 and 2005.

– According to data from the National Sample Survey Organization, the workforce participation rate has increased by 2.85% a year between 2000 and 2005.

– This increase has been more significant in urban areas and among males.(2)

– This trend is a reversal of the jobless growth witnessed in the 1990s.

The National Sample Survey Organization defines workforce participation rate as “the number of persons working as a percentage of the total population.(1) Census India (2001)(2) “Now, jobs grow faster than population in India,” The Times of India, August 11, 2007.


India’s Working Age Population will Overtake China’s Working Age Population

According to Sanjeev Sanyal of Deutsche Bank, India’s working age population will overtake China’s working age population by the middle of the next decade.

China’s working age population will rise to a peak of 998 million by 2015 after which it will decline steadily. India’s age profile is over 15 years behind China’s, but its working age population is already growing rapidly. Between 1990 and 2005, the population in the 15- 64 year range rose from 501 million to 703 million. UN projections suggest that India’s potential labor force will keep growing for several more decades to 918 million by 2020 and eventually to over 1100 million by 2040.

Source: “India’s working age population fast growing,” New Indian Express, August 2, 2007.


As Workforce Supply Continues to Overshadow Demand, Stall in Salaries Will Continue

The Boston Consulting Group foresees a stall in salaries, as India’s workforce supply continues to be greater than demand.

India's workforce supply will be greater than demand, which will reduce the rise in Indian salaries and maintain the current gap

between Indian salaries and salaries in other countries. Companies working out of India will have the same cost

advantage as they have in the current scenario. Compared to other countries, India will have the maximum labor cost advantage by 2020.

Source: “INDIA LIKELY TO EMERGE THE BIGGEST LABOUR POOL BY 2020 (surplus population in the working age group expected to go up to 47 million by 2020),” Indian Business Insight, May 31, 2006.


Part II

Part E. Engineers, IT Professionals, and “Knowledge-Based” Employees


India has emerged as the fastest growing IT hub in the world The IT industry has grown its revenues ten-fold in the past decade from US$ 4.8 billion in 1997-98 to US$ 47.8 billion in 2006-07The IT industry's contribution to GDP rose from 1.2 per cent in 1999-2000 to an estimated 5.2 per cent in FY 06-07Industry employs over 1.6 million professionals directly and Indirect employment attributed by the industry is estimated to be 4x, translating to over 6 million additional jobs India is fast emerging as a research and development hub for some of the largest IT companies in the world

Source: NASSCOM

Indian IT: Going From Strength to Maturity


India Produces Many Engineers and IT Professionals

There are more than 2.5 million qualified engineers in India.(1)

India currently has 113 universities and 2,088 colleges, many of which teach various engineering disciplines.

In the 2004-05 academic year, a total of 1,355 engineering colleges admitted 460,000 students. – The number of graduates swelled to 520,000 in 2005-06. – By 2006-07, the number of colleges had increased to 1,503, which

admitted 583000 students in all.(2)

Engineering colleges in the country have been growing at 20 percent a year, while business schools have grown at 60 percent.

Source: Knowledge Professionals in India, NASSCOM report 2007.


Number of Engineering Graduates and IT Professionals

“IT Professionals” include Comp Science, Electronic, and Telecom professionals. Source: "INDIAN ITES-BPO INDUSTRY : NASSCOM ANALYSIS & Key Highlights of the IT-BPO sector performance in FY 2007-08."

Title 2003-2004 2004-2005 2005-20062006-2007

2007-2008

Number of Engineering Graduates

316,000 365,000 441,000 501,000 536,000

Degree (Four Years)139,000 170,000 222,000 270,000 290,000

Diploma and MCA (Three Years)

177,000 195,000 219,000 231,000 246,000

Number of IT Professionals 179,000 201,000 246,000 280,000 303,000

Engineering IT Graduates (Degree) 84,000 102,000 133,000 162,000 180,000

Engineering IT Graduates (Diploma) 95,000 99,000 113,000 118,000 123,000


Number of Engineering Graduates and IT Professionals

According to AICTE, approximately 440,000 students were enrolled in first-level engineering degree programs in 2004-05: 265,000 at the diploma level and 33,000 at the master’s level. – By comparison, the seven IITs had a total of 25,000 students enrolled at all

levels in 2002-03.

Figures that capture the annual number of graduating engineers are harder to come by. – A 2005 study by Washington, D.C.-based National Academies estimates that

200,000 students graduate each year from first-level engineering programs in India (revised from an original estimate of 350,000).

– A study by researchers at Duke University pegs the number slightly higher at 215,000, but notes that almost half are graduating from three-year diploma programs.

– By comparison, the National Academies estimates that U.S. institutions graduate 70,000 engineering students annually, while approximately 100,000 students graduate from institutions in the European Union.

Source: “Engineering Education in India: A Story of Contrasts,” World Education News and Reviews, January 2007.


India’s IT and ITES-BPO Sectors are Growing

NASSCOM anticipates an estimated demand for 850,000 IT professionals and 1.4 million ITES-BPO professionals by 2010. – With offshore penetration for both IT as well as ITES-BPO services

estimated at about 10 percent, and offshore adoption rising rapidly, demand for these services from India is expected to continue on its high growth trajectory.

The number of technology and knowledge professionals employed in India has grown from 830,000 in FY 2003-04 to well over one million in FY 04-05.

Source: "INDIAN ITES-BPO INDUSTRY : NASSCOM ANALYSIS & Key Highlights of the IT-BPO sector performance in FY 2007-08."


Number of "Knowledge-based" Employees in India

Sector FY 2004 FY 2005 FY 2006 FY 2007

IT Services 614,000 741,000 878,000 1,072,000

ITES-BPO 253,000 316,000 415,000 553,000

Total number of employees in the Indian ITES-BPO INDUSTRY

867,000 1,057,000 1,293,000 1,625,000

Source: "INDIAN ITES-BPO INDUSTRY : NASSCOM ANALYSIS & Key Highlights of the IT-BPO sector performance in FY 2007-08."


ACM in India

Establishing a presence in the major technology hubs of China and India.An India Task Force was launched in 2007Initial meetings were held to build professional relationships and secure the best methods for sharing ACM’s publications, services, and resources.The task force met in Bangalore to explore how best to serve this burgeoning audience.

Source: ACM Annual Report for FY07


Part III

Education


Part III

Part A. Primary & Secondary Education


Education

Education is widely perceived by members of socially or economically disadvantaged groups as the most promising means of upward mobilityEducation in India from primary to higher education is administered by the Ministry of Human Resource DevelopmentIt is heavily subsidized by the Indian government, though there is a move to make higher education partially self-financingThe Indian Government is considering the option of allowing hundred percent foreign direct investments in Higher Education.

Source: Society and Development: National and International Perspectives, NIEPA, ASAE India Study Mission Feb 2008


Operation Blackboard

Launched in 1987 to improve quality of primary schools

Aims to improve:– educational facilities

– instructional material

– education



Non-Formal Education

Introduced to uphold the National Policy on Education (1986) and the Programme of Action (1992) goal of providing education of satisfactory quality to all children up to 14 years.

Main features: – Short term courses with a duration of about two years

– Part–time instruction at a place and time convenient to learners in small groups

– Flexibility in the mode of delivery

– Special emphasis on girl’s education



National Council for Teacher Education (NCTE)

Established as a national level statutory body by the Government of India

Objectives: – Receiving planned and coordinated

development of teacher education courses

– Recognition of teacher education institutions

– Developing guidelines for minimum qualifications for appointment of teachers



National Programme of Nutritional Support to Primary Education (NP- NSPE)

Mid-Day-Meal plan was launched in August 1995

Increasing enrolment retention and attendance while simultaneously impacting nutritional levels of students in primary classes (I to V)

Cooked food with calorific value equivalent to 100 gms of wheat/ rice is given to every student per school day



Public Education

More Indian children are in school than ever beforeHowever quality of public schools has sunk Children in public school come from the poorest of familiesSurvey conducted across 16,000 villages in 2007 found that while many more children were sitting in class, vast numbers of them could not read, write or perform basic arithmetic– Among children in the 5th grade: 4 out of 10 cannot read at

the 2nd grade level– 7 out of 10 cannot subtract

Public spending on schools has steadily increased in the last few yearsEducation is about 4%of the GDP

Source: “Education Push Yields LIttle for India’s Poor (17 January 2008),“ New York Times.


Secondary Education

National Policy of Education, a centrally sponsored program of Vocationalisation of Secondary Education was introduced in February 1988 Objective is to enhance individual employability, reduce the mismatch demand and supply of skilled resources and provide an alternative for those pursuing higher education without particular interest or purpose. Courses are selected by the State Government on the basis of assessment of resource requirements through district vocational surveys



Secondary Education: Vocational Courses

Approx. 150 vocational courses have been introduced at the +2 level in the following major areas: – Agriculture

– Business and Commerce

– Engineering and Technology

– Health and Para-medical Services

– Home Science Services

The program emphasises practical training of students both during the course and after completion.



Integrated Education for the Disabled Children (IEDC)

Focuses special attention on the education of disabled children to achieve the goal of ‘Education for All’

Advocates the approach of providing integrated education for the mildly handicapped and of special education for the severely handicapped children



Science Education

Financial assistance is provided for the conduct of experimental and innovative programs including: – Science Kits for primary schools

– Upgradation and strengthening of science laboratories in secondary and senior secondary schools

– Supply of books in science related subjects

– Training of science and mathematics teachers.



International Mathematical Olympiad (IMO)

To identify and nurture talent in mathematicsIMO is held yearlyEach participating country is required to send a team consisting of not more than six secondary school contestants, a team leader and a deputy leaderThe Ministry of Human Resource Development generally provides the requisite financial support



National Award for Teachers

Launched in 1958 with the objective of raising the prestige of teachers

Recognizes the meritorious teachers working in Primary, Middle and Higher Secondary Schools.



Promotion of Yoga in Schools

The National Policy on Education, 1986, lays down special attention to Yoga, as a system to promote integrated development of body and mind

Efforts are in progress to introduce Yoga in all schools and in teacher training courses



National Open School

Established in November 1989

Autonomous organization under the Department of Education

Provides education to students through distance education

Has exclusive departments for Vocational Education and Student Support Services



Expenditure on Education in India

Government of India has highly subsidized higher education

Nearly 97% of the Central Government expenditure on elementary education goes towards the payment of teachers' salaries.



Budgetary allocation for 2007-08

Allocation for Education was enhanced by 34.2 per cent, from 17,133 cores to 23,142 cores. Secondary education allowance was increased from Rs 1,837 cores to Rs 3,794 cores.To prevent dropouts, a National Means-cum-Merit Scholarship was implemented, with an allocation of Rs 6,000 per child.Allocation for SC/ST scholarships enhanced from Rs 440 cores to Rs 611. crore. Scholarships programme for minorities students to be of the order of Rs 72 crore for pre-metric, Rs 48 crore for graduate and postgraduate students. Rs 50 crore provided to begin work on vocational education mission for which the task force in the Planning Commission is chalking out a strategy. 1,396 Indian technical institutes to be upgraded to achieve technical excellence.Rs 100 crore for recognising excellence in the field of agricultural research.



Part III

Part B. India's Government Structure with Respect to Education and Technology


All India Council for Technical Education

The All India Council for Technical Education (AICTE) plans and coordinates the development of India’s technical education system.

AICTE also regulates entry and operation of foreign universities/institutions in India for imparting technical education. – In the fields that the AICTE regulates (engineering, technology,

management, architecture, town planning, pharmacy, applied arts and crafts, hotel management and catering), institutional and program accreditation is the responsibility of the National Board of Accreditation (NBA), an autonomous body under the umbrella of the AICTE.

Source: “Engineering Education in India: A Story of Contrasts,” World Education News and Reviews.


All India Council for Technical Education (Cont’d)

AICTE’s accreditation structure is troubling for those that want India’s engineering sector improve its international credibility through membership of the Washington Accord. – The Washington Accord is multilateral agreement that represents

agencies that accredit engineering programs in 12 member countries and accept one another’s standards as an equally high standard.

– The agreement recommends that graduates of accredited programs be recognized as having met the academic requirements for entry to the practice of engineering in any member country.

AICTE’s latest bid for membership was rejected in 2005. – AICTE cut a total of 22,722 seats at more than 300 engineering

colleges in the months following the failed 2005 bid. – To help meet demand, 16,357 seats were added at approximately

200 other institutions that met AICTE requirements.

Source: “Engineering Education in India: A Story of Contrasts,” World Education News and Reviews.


Ministry of Human Resource Development

India’s Ministry of Human Resource Development includes the Department of School Education and Literacy and the Department of Higher Education.

Several of the Ministry of Human Resource Development’s major technology initiatives include:

– A one stop education portal to showcase the Government’s efforts to offer open learning resources to students of all grades.

– A common entrance examination for admission to technical and professional courses.

– Total turnkey IT supports for the execution and effective implementation of its programs.

Source: India’s Ministry of Human Resource Development.


Council of Scientific & Industrial Research

The Council of Scientific & Industrial Research (CSIR) mission is to “provide scientific, industrial R&D that maximizes economic, social, and environmental benefits for the people of India.”

CSIR’s recent initiatives include:

– A Memorandum of Understanding with Alcoa. The Memorandum is part of Alcoa's open innovation policy to partner in

collaborative research projects that address critical global issues such as energy efficiency, alternative and renewable energy sources.

Source: http://www.csir.res.in/External/Utilities/Frames/pressroom/main_page.asp?a=topframe.htm&b=leftcon.htm&c=../../../Heads/pressroom/press_room.htm


Department of Science and Technology

India’s Department of Science & Technology (DST) was established in May 1971 with the objective of promoting new areas of Science & Technology and to play a role in the development of organizing, coordinating and promoting S&T activities in the country.

DST’s recent initiatives include:

– A gift of approximately $1.1 million to Guru Gobind Singh Indraprastha University to launch an M.Tech. program in Nanotechnology from the next academic session in 2008.(1)

– Plans to launch a new program called Innovation in Scientific Pursuit for Inspired Research (INSPIRE) to attract talented young people towards a career in science.(2)

(1) “I.P. University to launch new course in Nanotechnology,” The Hindu, January 18, 2008.(2) “Sibal unveils science plan,” Hindustan Times, January 12, 2007.


National Informatics Centre, Defense Research and Development Organization

The National Informatics Centre (NIC) of the Department of Information Technology provides the network backbone and e-Governance support to India’s central government, state governments, UT administrations, districts and other government bodies.

– NIC offers a wide range of services including a Nationwide Communication Network for decentralized planning, improvement in government services, and wider transparency of national and local governments.

India’s Defense Research and Development Organization (DRDO) is one of Asia’ largest defense contractors and a leading aerospace manufacturer.– It was formed in 1958 by the merger of Technical Development

Establishment and the Directorate of Technical Development and Production with the Defense Science Organization.


Central Power Research Institute

India’s Central Power Research Institute (CPRI) is an autonomous society under India’s Ministry of Power.

– Set up in 1960, CPRI functions as a center for applied research in electrical power engineering, assisting the electrical industry in product development and quality assurance.

– CPRI also serves as an independent authority for testing and certification of power equipment.

– CPRI's governing body includes eminent professionals from industries, utilities, prestigious academic and research institutions and the government.


Other Initiatives

The National Botanical Research Institute organized a teacher’s training and motivation program for teachers of various inter, graduate and postgraduate colleges.

The National Institute of Oceanography (NIO), Goa, signed a Memorandum of Understanding with Ecole Nationale Superieure d’Ingenieurs de Limoges (ENSIL), University of Limoges, France, for research cooperation in the areas of Environmental Pollution and Ecotoxicology. – Under this Memorandum, exchange of students, scientists and

scientific information between these two organizations would take place.

– The use of facilities and equipment at both laboratories would the also be made available to the individuals working under the cooperative research program.

Source: http://www.csir.res.in/External/Utilities/Frames/pressroom/main_page.asp?a=topframe.htm&b=leftcon.htm&c=../../../Heads/pressroom/press_room.htm.


Other Initiatives (Cont’d)

India’s Ministry of Human Resource Development Planning will open an Indian Institute of Information Technology in each state to improve the quality and quantity of technical manpower in the country.

– The proposed 20 institutes will be open from July 2007.

– The government's plan has also been endorsed by NASSCOM.(1)

Dr. APJ Abdul Kalam, Former President of India, launched the Total Proficiency in Satellite and Information Technology and Communication- enabled education program.

– The program is part of Application of Science and Technology in Educational Reform, a project of the Atomic Energy Education Society.

– The program aims at enhancing the teaching-learning process in the country.(2)

(1) “India to churn out more techies,” The Economic Times, June 9, 2006.(2) “KALAM LAUNCHES NEW PROGRAMME,” Indian Business Insight, December 13, 2007.



The Indian government plans to open an Institute of Petroleum Technology in the Sultanpur district of Uttar Pradesh to train personnel for the growing requirements of the hydrocarbon sector.

– To be called the Rajiv Gandhi Institute of Petroleum Technology, it will be incorporated as an "institution of national importance" through an Act of Parliament.(1)

The European Commission-sponsored EuroIndia project announced the launch of its Web site.

– Designed to promote stronger collaboration between EU and Indian scientists and industrialists, the site aims to be the focal point for information in nanotechnologies and nanosciences.(2)

(1) “Institute of petroleum technology,” Hindustan Times, December 27, 2006.(2) “India-EU tie-up on nanotechnology,” Business Line (The Hindu), August 18, 2006.



Indian Institute of Technology (IIT), Kanpur has selected the BE (Bentley Empowered) Careers Network program to introduce engineering students to the latest software for improving the world's infrastructure.

– The program will support IIT-Kanpur's efforts to provide its students with the software skills they need to succeed in the field of infrastructure, including architecture, engineering, construction, and operations.(1)

The Indian Institute of Technology (IIT), Chennai set up a $25 million in February 2007 to promote innovations in partnership with communication industry. – According to Union Minister of Communications and IT Dayanidhi Maran: “The

IIT Research Park will provide space for innovations by the faculty, students and industry. The park will conform to international standards and will be at par with such ventures in and the US and Britain.”(2)

(1) “Indian Institute of Technology Kanpur Selects Bentley's BE Careers Network Program,” Business Wire, May 11, 2006.(2) “IIT Chennai to launch research park,” Hindustan Times, July 23, 2006.


Part III

Part C. Quality of Engineering Education in India


Top Engineering Programs are Government-Funded

Indian Institutes of Technology. The central government administers and funds India’s central universities and institutions of national importance (INI). The INIs are well-funded with highly competitive entrance requirements. – The best known of the 13 INIs are the seven Indian Institutes of Technology (IIT).

– The IITs are considered to offer the highest-quality technology and engineering programs in India, especially at the undergraduate level.(1)

National Institutes of Technology. In 2003, the central government took over and fully funded regional engineering institutes and converted them into the National Institutes of Technology (NIT). – The government aims to establish an NIT in each state and union territory of the

country.(2)

There are many other “deemed-to-be universities” and central universities that enjoy reputations as top engineering schools.(3)

(1) “Engineering in India: A Story of Contrasts,” World Education News and Reviews, January 2007.(2) India’s Department of Higher Education.(3) “Engineering in India: A Story of Contrasts,” World Education News and Reviews, January 2007.


IITs Retain Highest Rankings; Excluding IITs, NITs Dominate in All Regions Except West

Source: “India's Top T-Schools,” Dataquest, June 22, 2007.


Government-Funded Programs Have High Admission Standards and Limited Capacity

The Indian Institutes of Technology have high admission standards and a rigorous work load.

– Preparation for the IIT Joint Entrance Examination (IIT-JEE) can begin as early as primary school and often culminates in a final year of secondary school that includes up to six hours of training and homework at IIT-JEE preparation schools in addition to regular school classes.

– In 2006, a record 300,000 IIT aspirants took the IIT-JEE; just over 4,000 were offered a place. The ratio of IIT-JEE takers to IIT places was 74:1.

– IIT students have incredibly heavy workloads. Students must complete 180 credits to graduate from four-year undergraduate programs.(1)

– Virtually 100% of IIT graduates secure a position before they left school.(2)

The National Institutes of Technology and engineering schools at other deemed and central universities use the All India Engineering Entrance Examination.

– Taken by more than 400,000 students, the NITs admit approximately 7,000 undergraduate students annually.(3)

(1) “Engineering in India: A Story of Contrasts,” World Education News and Reviews, January 2007.(2) “Engineering in India,” ARC Advisory Group, November 5, 2007.(3) “Engineering in India: A Story of Contrasts,” World Education News and Reviews, January 2007.


Consequently, Private Technical Institutions Have Proliferated

The government-supported institutions do not have the capacity to meet the demand for engineering graduates.

– About 99% of all entrance examination participants in the IITs and Indian Institutes of Management are rejected due to capacity constraints.

Consequently, private engineering institutions have spawned all over India.

– In 1970, India had a total of 139 engineering institutions, and only four of these were private.

– In 2007, there were 1,522 engineering colleges with 80% being private colleges.

Source: “Engineers: Quantity over quality?,” The Times of India, May 26, 2007; Ministry of Human Resource Development, 2006-2007 Annual Report.


India Has Experienced a Significant Increase in Engineering Graduates

The annual number of Bachelors degrees in engineering has increased at a compound annual growth rate of 12%.

The number of engineers per million population increased from about 1 in 1947 to 213 in 2006.

Total Output of Engineering Graduates 1947-2006

Source: Engineering Education In India, Energy Systems Engineering, IIT Bombay, September 14, 2007.


Despite Increase, There is a Shortfall of Hirable Engineers

There appears to be a mismatch between the skills students are graduating with and the skills required.

HR professionals consulted for a 2003 McKinsey Global Institute study said only 25% of all Indian engineering graduates were suitable for hire by multinationals.(1)

Only about 5% of engineering graduates continue to complete masters degrees; of these, only 3% go on to do a doctorate.(2)

(1) “Don’t Be Afraid of Offshoring,” BusinessWeek, March 22, 2006.(2) “Engineers: Quantity over quality?” The Times of India, May 26, 2007.

Source: McKinsey Global Institute, The Emerging Global Labor Market, June 2005


Engineer Shortfalls (Cont’d)

Craig Mundie, Chief Technology Officer and Senior Vice-President for Advanced Strategies and Policies of Microsoft Corporation, said India is yet to emerge as a powerhouse for product development business. – Blaming India's engineering education system for this lapse, he said

the country churned out a relatively "small percentage" of engineers in computer science and called for a "balancing" of the curriculum to support product development activities.

– According to him, India now produced less than 50 PhDs in computer science, which was "less than one large computer science department in the U.S."

Source: “Microsoft official wants India to revamp curriculum,” The Hindu, August 10, 2005.


Major Challenge: Shortage of Qualified Instructors

There is a shortage of instructors at second and third tier institutions, primarily due to a dearth of PhDs and salaries that are far below industry standards.– IITs are currently understaffed by as much as 30%. Various experts

estimate that India’s entire education system has only 10% to 30% of the qualified instructors it needs.(1)

– In India, a full professor might earn the equivalent of $15,000 annually. That same engineer might earn the equivalent of roughly $70,000 to $100,000 per year. By way of comparison, a U.S. engineering professor might take home $90,000 a year, contrasted with an industry salary of $150,000. (2)

– In 2005, the government slashed the intake capacity of engineering schools by more than 250,000 seats across India’s private university system due to a shortage of engineering teachers.(3)

(1) “India eyes fixes for education,” EE Times, December 17, 2007.(2) “India eyes fixes for education,” EE Times, December 17, 2007.(3) “India's engineering teachers flee classroom for hot jobs,” The Christian Science Monitor, July 13, 2005.


Other Challenges

Shortage of government funding

– According to the National Institute of Education Planning & Administration, the share of government expenditure on technical education presently hovers around 4%.

– In China, the amount spent on research and development, especially in engineering fields, is 10%.(1)

Geographic inequalities

– More than two-thirds of engineering degree education is concentrated in four States, while the rest of India must do with 30%.(2)

Accreditation shortfall

– Less than 10% of institutions in the technical sector are accredited.(3)

(1) Engineering education: Can India overtake China?” Rediff News, June 9, 2006.(2) “70% Engineering Deg Education In 4 States: HRD,” UNI (United News of India), December 17, 2007.(3) “Engineering in India: A Story of Contrasts,” World Education News and Reviews, January 2007.


India is Taking Steps to Improve the Quality of Engineering Education

Developing the country’s higher education system. India’s government is building out the higher-education system, which includes establishing several tech and research institutes, along with eight more IITs.(1)

Belonging to the Washington Accord. In 2007, India was inducted into the Washington Accord as a provisional member. – The Accord recommends that graduates of programs accredited by any

of the signatory bodies be recognized by the other bodies as having met the academic requirements for entry to the practice of engineering.

– As a provisional member, India will be given two years to bring its academic system to the international level and revise its accreditation system to make it fully outcome based.(2)

(1) “India eyes fixes for education,” EE Times, December 17, 2007.(2) International Engineering Alliance.


India is Taking Steps to Improve the Quality of Engineering Education (Cont’d)

Adding finishing schools to enhance employability. In 2007, the Ministry of Human Resource and Development proposed a Finishing School program for engineering graduates who had not secured jobs. The pilot program is designed to focus on technical and soft skills for a duration of 8 -10 weeks to make students more employable and bridge the manpower supply-demand gap by at least thirty to forty percent.(1)

Using technology to close student-teacher gap. Visveswaraya Technical University uses satellite programs for distance learning to reach 13,000 students with one professor.(2)

Changing faculty policies. Government providing incentives for intensive training programs for tutors and raising the retirement age from 58 to 62. Retired professors can teach until they reach the age of 70.(3)

(1) “Finishing Schools to enhance employability,” The Hindu, April 9, 2007. (2) “Wanted: Indian EE professors,” Electronic Engineering Times, December 17, 2007.(3) “Wanted: Indian EE professors,” Electronic Engineering Times, December 17, 2007.


India is Taking Steps to Improve the Quality of Engineering Education (Cont’d)

Lifting foreign-direct investment restrictions. Atlanta-based Georgia Institute of Technology will set up its international campus in Hyderabad. – The university will become operational in 2009 and will offer MS degrees and PhD

programs in engineering, science, management, business and other academic streams. Among the schools said to be eyeing Indian operations are Harvard Business School, Purdue and Cornell, in the United States, and Nottingham University, in the United Kingdom.(1)

Developing American-style universities. Vedanta University, an American-style university, is proposed for the Indian state of Orissa. Indian business tycoon Anil Agarwal plans to use Stanford University as the template for the $3.5 billion institution. (2) – Indian students have been studying abroad: The top 40% rejected from IIT and

Indian Institutes of Management go abroad. Over 150,000 students every year go overseas for university education which costs India a foreign exchange outflow of US$ 10 billion per annum.(3)

(1) “Wanted: Indian EE professors,” Electronic Engineering Times, December 17, 2007.(2) “India takes on the world,” The Independent, October 11, 2007.(3) The Associated Chambers of Commerce and Industry of India, March 17, 2008.


Part IV

How Technology Professionals Work in India vs. the US


Study conducted for the IEEE by Tenopir, Levine & Allard, 2006

Study to examine how technical professionals in innovative high-tech firm in the US and India communicate to use information within their daily work activitiesObserved technical professionals at US and India based firmsTo understand how engineers work and how they use existing information products and services in the unique and dynamic environment of an innovative technology firm

Source: How Technology Professionals Work, Study conducted for the IEEE by Tenopir, Levine & Allard, 2006


Meetings

The duration of meetings in the U.S was slightly longer than those in India, and the U.S. meetings generally had more people in attendance. Meetings in India companies averaged about 47 minutes in duration and had 5 employees in attendance.In comparison, meetings in a U.S. company lasted 55 minutes and had 7.6 employees in attendance. In the U.S. we also found that the longer the meeting lasted, the more employees were present. This suggests that corporate culture in the U.S. encourages the meeting as a means of communication while it is not as essential to India corporate culture.



Virtual Meetings

India had fewer virtual meeting members in India than in the U.S.

In the U.S. more than one-third of all observed meetings had at least one virtual member on speaker phone.

In India only 20% of the meetings had at least one virtual attendee.

Meetings with European and U.S. customers or partners were generally scheduled during the very early morning.



Presentations in Meetings

The use of presentation technology in meetings was less prevalent in India. Presentation software and digital projectors were found in about half of the meetings in the U.S. while it was used in only one in five meetings in India. This suggests that India companies may not be as interested in information products that are designed to be used during meeting presentations.



Locations of Meetings

The locations of meetings also varied between the India and U.S. In India, just more than a third of the meetings were held in conference rooms, 40% were held in workspaces and none were held in managers’ office. In the U.S. about two thirds of meetings took place in meeting or conference rooms, 21% in other workspaces (cubicles, testing labs), and 10% in managers’ offices.



Multitasking in Meetings

Multitasking occurs more frequently during U.S. meetings than during India meetings.

U.S. meeting participants were engaged in multitasking in 46% of meetings while in India multitasking was only recorded in 20% of the meetings.

The kind of activities that engineers engaged in during multitasking were writing and reading e-mails, surfing the Internet and the company’s intranets, or continuing their regular work.



Duration of Meetings

The duration of meetings in the U.S was slightly longer than those in India, and the U.S. meetings generally had more people in attendance. The average meeting in a U.S. company lasted 55 minutes and had 7.6 employees in attendance. In comparison, meetings in India companies averaged about 47 minutes in duration and had 5 employees in attendance.



“Traditional” Technology in Meetings

The use of “traditional” technology of whiteboards varied greatly between India and the U.S.

In India whiteboards were used in 72% of the meetings while in the U.S. whiteboards were only used in 19% of the meetings.

Whiteboards were used to enhance and/or explain the verbal message with graphs, schemas and formulas.



Multitasking Behavior

Engineers are frequently engaged in multitasking behavior. In fact, being involved in multiple activities at the workplace can ostensibly extend the work day by as much as 80 minutes.On average, the U.S. worker puts in approximately 70 minutes of work during every 60 minute period and in India about 65 minutes per each hour.This suggests that the Indian worker is more focused on the task at hand and that there are fewer interruptions in the Indian workplace. Obviously, future research would need to be conducted to understand this marked difference between the U.S. and India.



Multitasking ActivitiesEngineers also engage in concurrent or overlapping activities. We recorded many more combinations of concurrent or overlapping activities In the U.S. (39 combinations) than in India (21 combinations). The two most frequent overlapping activities in the U.S. were software/ email and face-to-face/software. In India, the two most frequent overlapping activities were face-to-face/software and software/software. What is interesting about the top two overlapping activities in each country is the focus on communication in the U.S. In the U.S. the overlapping activities each include a communication event. In fact, we witnessed many instances of engineers engaging dual communication channels nearly simultaneously – for example doing email during a telephone call. However in India the overlapping activities might not always include a communication event (software/software). There were also times when the employees engaged in 3 recorded activities, including phone – software – email and software – software – IM.



Part V

India's Current Economic and Geopolitical Landscape


India's Geopolitical Landscape: Overview

India’s domestic political scene will be dominated by the next general election (May 2009). – The increasing importance of regional parties will ensure that

the next government will again be a coalition, likely to be led by either the current ruling party, the Indian National Congress, or by the main opposition Bharatiya Janata Party.

– A governing alliance of regional and left-wing parties is also a possibility.

The government will remain committed to increased spending on health, education and rural-welfare projects in a bid to improve living standards outside the country's fast-growing urban areas.

Source: “March 2008 Country Data,” The Economist Intelligence Unit.


India's Geopolitical Landscape: Overview (Cont’d)

Strong economic growth will increase tax revenue, allowing the government to continue to reduce the country’s budget deficit.

The Reserve Bank of India will loosen interest rates modestly and allow the rupee to appreciate.

– Monetary policy will remain neutral in 2010-12.



India's Economic Landscape: Overview

India's economic boom will continue, albeit at a slightly slower pace than the past several years.

Real GDP growth is forecast to slow from an estimated 8.7% in fiscal year 2007/08 to an annual average of 7.6% in 2008/09-2012/13.

The strength of the rupee against the US dollar will mitigate inflationary pressures by limiting import-led price rises.– However, strong domestic demand, together with supply-side bottlenecks, will

keep consumer price inflation at an average of around 5.3% a year in 2008-12.

Through 2050 India’s economy will grow faster than those of Japan, the United Kingdom, and the United States, but not as fast as China’s economy.



Key Quarterly Indicators

Source: "Country Data, Quarterly indicators India (February 2008),” Economist Intelligence Unit.* All units in US dollars and billions, unless otherwise noted.

Title 2006Q1 2006Q2 2006Q3 2006Q4 2007Q1 2007Q2 2007Q3 Source

GDP (% real change) 10.903 8.113 10.729 9.021 9.565 9.218 8.777 Derived from Central Statistical Organization, India

Exchange rate LCU:US$ (av.)

44.402 45.471 46.37 44.984 44.172 41.234 40.525 IMF, International Financial Statistics

Budget balance (% of GDP)

-3.85 -8.518 -0.915 -0.761 -4.143 -10.599 2.889 Derived from IMF, International Financial Statistics

Consumer prices (% change av.)

4.88 6.333 6.605 6.845 7.003 6.319 6.702 Reserve Bank of India

Industrial production (% change)

8.734 10.451 11.811 11.219 12.509 10.265 8.616 Derived from Central Statistical Organization of India

Lending interest rate (%)


Trade balance -12.063 -10.923 -13.725 -17.165 -14.294 -20.329 -17.341 Asian Development Bank, Key Indicators of Developing Asian and

Pacific Countries


India’s GDP: Key Indicators

Source: International Monetary Fund, World Economic Outlook Database (October 2007).* All units in billions.

Title 2004 2005 2006 2007 2008 2009 2010 Source

GDP (% real change) 8.325 9.232 9.354 7.8 7.5 7.2 7.3 Derived from Central Statistical Organization

Nominal GDP (US$ at PPP)

2161.1 2431.9 2743.3 3031.2 3326.2 3660.7 4033 EIU calculation. Based on figures from World Bank,

World Development Indicators.


GDP and Inflation (2006-2008)

Source: International Monetary Fund, World Economic Outlook Database (October 2007).* All units in US dollars.

Title Units Scale 2006 2007 2008

Estimates

Start After

Gross domestic product, constant prices

Annual percent change

9.7 8.9 8.4 2006

Gross domestic product, current prices

National currency Billions 39582.3 45294.2 51076.5 2006

Gross domestic product, current prices

U.S. dollars Billions 873.659 1,089.94 1,249.44 2006

Gross domestic product, deflator Index 130.506 137.151 142.737 2006

Gross domestic product per capita, constant prices

National currency Units 27250.7 29226.3 31199.3 2005

Gross domestic product per capita, current prices

National currency Units 35563.8 40084.1 44533 2005

Gross domestic product per capita, current prices

U.S. dollars Units 784.962 964.571 1089.37 2005

Gross domestic product based on purchasing-power-parity (PPP)

valuation of country GDP

Current international dollar

Billions 4231.58 4726.54 5210.21 2006


GDP and Inflation (2006-2008) (Cont’d)

Source: International Monetary Fund, World Economic Outlook Database (October 2007).

Title Units Scale 2006 2007 2008

Estimates

Start After

Gross domestic product based on purchasing-power-parity (PPP) per

capita GDP

Current international dollar

Units 3801.97 4182.86 4542.72 2005

Gross domestic product based on purchasing-power-parity (PPP)

share of world total

Percent 6.28 6.433 6.576 2005

Inflation, average consumer prices Index, 2000=100 129.011 137.06 143.031 2006

Inflation, average consumer prices Annual percent change

6.1 6.2 4.4 2006

Inflation, end of period consumer prices

Index, 2000=100 132.292 138.835 144.419 2006

Inflation, end of period consumer prices

Annual percent change

6.7 4.9 4 2006

Current account balance U.S. dollars Billions -9.503 -23.131 -32.301 2006

Current account balance Percent of GDP -1.1 -2.1 -2.6 2006


India's GDP, in Comparison to Other Major Economies

Source: International Census Bureau.


India's Economic Landscape: Overview (Cont’d)

Between 2004 and 2010 inward direct investment will grow significantly, from 5.8 billion (2004) to 40 trillion (2010).

Between 2006 and 2008, total exports and imports will increase. – Total imports will increase more than total exports.

Between 2006 and 2008, the percent change of consumer prices will decrease slightly, from 6.12 percent in 2006 to 5.8 percent in 2008.



Key Indicators: Foreign Payments

Source: International Monetary Fund, World Economic Outlook Database (October 2007).* All units in US dollars and millions, unless otherwise noted.

Title 2004 2005 2006 2007 2008 2009 2010 Source

Current-account

balance/GDP

0.113 -1.277 -1.033 -1.3 -2.3 -1.5 -1.6 Derived from Reserve Bank of India, Central

Statistical Organization of India

Financing requirement

-13893.4 -25693.7 -17047.9 -28187 -46976.3 -42238.5 -48043.9 Derived from Reserve Bank of India

Inward direct investment


International reserves

130401.0 136026.0

176105.0

275414.0

311840.0

349152.0 392796.0 Derived from IMF, International Financial

Statistics


Key Indicators: External Debt and External Trade


Total foreign debt 135098.0

146625.0

161660.0

World Bank, Global Development Finance.

Total debt per head 123.3 132.0 144.0 Derived from IMF, International Financial Statistics; World Bank, Global Development Finance.

Source: "Country Data, External debt stock India (February 2008),“ Economist Intelligence Unit.* All units in US dollars and millions, unless otherwise noted.


Total exports 126331.0 152223.0 176386.0 Derived from Reserve Bank of India

Total imports 190566.0 229060.0 268198.0 Reserve Bank of India.


Key Indicators: Fiscal and Monetary Policy

Source: "Country Data, Fiscal and monetary indicators India (February 2008),“ Economist Intelligence Unit.


Budget balance (% of GDP) -3.461 -3.4 -3.2 Derived from Ministry of Finance, India

Consumer prices (% change) 6.177 6.4 5.8 Labor Bureau of India

Exchange rate LCU:US$ (av.) 45.307 41.333 38.25 IMF, International Financial Statistics

Lending interest rate (%) 11.217 13.1 12.8 IMF, International Financial Statistics

Stock market index 13786.9 Bombay Stock Exchange

Exchange rate LCU:US$ (end-period) 44.245 39.4 37.31 IMF, International Financial Statistics

Secondary exchange rate 47.119 42.99 39.78 Ministry of Finance, Economic Survey

Real effective exchange rate (CPI-based)


Real effective exchange rate (PPI-based)


Real effective exchange rate (ULC-based)



Part VI

Legal and Business Issues in India


FORM Liaison Office Project Office Branch Office Wholly owned subsidy/JVC

Section 25 Company/Society

Activities Non income earning activities

Execution of a specific project

Only specified activities

Any activities, subject to approval by the FIPB

Promote commerce, art, science, religion, charity, etc.

Restriction Various restrictions

Relaxed in the case of a project whose approval has been sought.

Various Restrictions

Only those imposed by the FIPB

Must use income for public purpose. May not pay dividends. FCRA approval may be required.

Direct Taxation

Not Taxed Taxed at 40%plus a 2.5% surcharge and a 2% education cessxed at 40%

Taxed at 40%plus a 2.5% surcharge and a 2% education cess

Taxed at 33.66% (inclusive of10% surcharge on income tax, 2% educationcess.)

May qualify for tax-exemption, subject to certain limitations.

Approval Time

3-4 Weeks 3-4 Weeks 4-6 Weeks 4-6 Weeks 3 to 4 months

Regulatory Authority

RBI RBI RBI FIPB/RBI RBI, MHA

Options Available to Associations

Source: Jeffrey R. Pankratz, Development Sourcing Advisors LLC, ASAE India Study Mission Feb 2008


Foreign Investment Regulatory Agencies

Foreign Investment Promotion Board

Reserve bank of India

Ministry of Commerce and Industry

Other sector specific agencies



FDI Regulatory Caps

Private Sector Banking* 74%Non Banking Financial Companies* 100%Insurance 26%Telecommunications** 49%Petroleum Refining 100%Housing and Real Estate 100%Airports 74%Trading 51%Power 100%Drugs and Pharmaceuticals* 100%Infrastructure 100%Hotel and Tourism 100%

*subject to restrictions**may be permitted up to 74% with FIPB approval



Prohibited Sectors

Gambling and betting

Lottery business

Atomic energy

Retail trading (except single brand)

Approval Required

Defense

Broadcasting

News



Entry Options for Foreign Companies in India

Operating as an Indian Company (Incorporated Entity)– Wholly Owned Subsidiary Company– Joint Venture with an Indian Partner

Operating as a Foreign Company (Unincorporated Entity)– Liaison Office– Project Office– Branch Office

Operating through an Agent (Third Party)– Agent without an Independent Status– An Independent Agent



Categories of Company

Main category– Company limited by guarantee– Company limited by shares– Unlimited company

Sub category– Union Government Company– State Government Company– Indian Non-Government Company– Subsidiary of Foreign Company– Company licensed under section 25– Guarantee and association Company– Others



Establishing Liaison/Project/Branch Office

Submit application to:Chief General Manger

Exchange Control Department

(Foreign Investment Division)

Reserve Bank of India

Central Office

Mumbai



Incorporating a Section 25 Company

Take RBI approvals, if necessary

Apply for availability of name

Prepare Articles of Association and Memorandum of Association

Place advertisements in two leading newspapers

Apply for issue of license under section 25

Apply for incorporation of a company



Indicative Costs in Mumbai

Monthly (unfurnished) office rent in Mumbai: USD 2/sq. ft. to USD 20/sq. ft.Monthly (unfurnished) apartment rent in Mumbai: USD 1/sq. ft. to USD 10/sq. ft.Commercial electricity rate: USD 0.20/kWhMonthly salaries of educated clerical staff: ~ USD 500Display ad rate in newspapers: USD 40 to USD 800 per sq. inch



Legal System

Multi-level system of courts and administrative tribunalsJurisdiction based on territory, size of dispute, other statutory requirementsLitigation is a lengthy processForeign judgments rarely directly executedArbitration and conciliation primary dispute mechanism for foreign business



Laws Governing Business

Arbitration and Reconciliation Act, 1996– Law relating to alternate redressal of disputes amongst

parties.

Central Excise Act, 1944– Governs duty levied on manufacture.

Companies Act, 1956– Governs all Corporate bodies.

Competition Act, 2002– Law to ensure free and fair competition in the market.




Consumer Protection Act, 1986– Law relating to protection of consumers from

unscrupulous traders/manufacturers.

Customs Act, 1962– Deals with import regulations.

Customs Tariff Act, 1975– The Act puts in place a uniform commodity

classification code based on globally adopted Harmonized System of Nomenclature (HSN) for use in all trade-related transactions.




Environment Protection Act, 1986– Provides framework for seeking environmental

clearances.

Factories Act, 1948– Law regulating labor in factories.

Foreign Exchange Management Act, 1999– Regulates foreign exchange transactions

including foreign investment.




Income Tax Act, 1961– Governs direct taxes on income of all persons, both

corporate and non-corporate as well as residents and non-residents.

Industrial Disputes Act & Workmen Compensation Act, 1951– Labor laws dealing with disputes.

Industries (Development & Regulation) Act, 1951– An Act to provide for the development and regulation of

certain industries.



Laws Governing BusinessInformation Technology Act, 1999– Law governing E-commerce transactions.

Money Laundering Act– Prevents money laundering and provides for

confiscation of property derived from, or involved in, money laundering.

Patents Act, Copyright Act, Trade Marks Act– Protects intellectual property rights.




Central Sales Tax Act, 1956– Governs the levy of tax on all inter-state sales

in India.

Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002– Puts in place securitization and asset

foreclosure laws creating a legal framework for establishment of Asset Reconstruction Companies.




Special Economic Zones Act, 2005– A comprehensive Act :

Provides for the establishment, development and management of the Special Economic Zones for the promotion of Exports and for matters connected therewith or incidental thereto.

Provides for fiscal and economic incentives for developer of / units in SEZ.




Right to Information Act, 2005– The Act sets out right of every citizen to

access information under the control of public authorities and to promote transparency and accountability in the working of every public authority. Provides for constitution of a Central Information

Commission and State Information Commission.




Societies Registration Act, 1860– Charitable societies– Military orphan funds or societies– Societies established for promotion of science, literature, or

for fine arts– Societies established for instruction and diffusion of useful

knowledge, diffusion of political education– Societies established for maintenance of libraries or reading

rooms for general public– Societies established for Public museums and galleries for

paintings or other works of art, collections of natural history, mechanical and philosophical inventions, instruments or designs




Indian Trusts Act, 1882– Relief of poverty or distress– Education– Medical relief– Provision for facilities for recreation or other leisure-

time occupation (including assistance for such provision), if the facilities are provided in the interest of social welfare and public benefit

– The advancement of any other object of general public utility, excluding purposes which relate exclusively to religious teaching or worship




Societies: A State Subject– Societies registration is a state subject

– Registered with “Registrar of Societies”

– In Maharashtra, a society must also be registered as a trust

Trusts: A State Subject– Trust registration is a state subject

– Registered with “Charity Commissioner”



Regulatory AuthoritiesSecretariat for Industrial Assistance (SIA)Foreign Investment Promotion Board (FIPB)Project Approval Board (PAB)Reserve Bank of India (RBI)Registrar of Companies (ROC)Securities and Exchange Board of India (SEBI)Central Board of Excise and Customs (CBEC)Central Board of Direct Taxes (CBDT)Authority for Advance Rulings (AAR)



Corporate Tax In India

Where taxable income exceeds INR 10 Million

Other cases

Domestic company

33.99% 30.9%

Foreign company

42.23% 41.20%



Other Direct Taxes

Individual Residents / Not Ordinary Residents and Non-Residents– Maximum rate of 33.99% where taxable income

exceeds INR 1 million– Maximum rate of 30.9% otherwise

Effective Tax Rates for USA– Interest: 10.5575% or 15.83625%– Dividend: 0% (DTAA: 15% or 25%)– Royalty: 10.5575% (DTAA: 10% or 15%)– Fee for Technical Services: 10.5575% (DTAA: 10% or

15%)



Part VII

Corporate Philanthropy in India


Corporate Philanthropy in India

In India, as in many parts of the world, ethics and philanthropyIn India, as in many parts of the world, ethics and philanthropy in the nineteenth century took the form of informal, benevolent actions on the part of merchants and businessmen/industrialists. The 20th century saw the emergence of the industrial class and business conglomerates that generated wealth on an unprecedented scale and created business dynasties. The favored method of philanthropy for such business houses led to the establishment of trusts and charitable funds. The 21st century has now seen the emergence of a new generation of young entrepreneurs who want to invest in philanthropy and see the fruit of that investment in their lifetime.

Source: The Conference Board: Going Global: Challenges for Indian Businesses


Correlation Between Ethics and Philanthropy

The Gandhian perspective of ethics that emerges from the socio-cultural context of Indian business defines unethical behavior as:– politics without principle;– wealth without work; and– commerce without morality.

To take the metaphor of the Indian organization as a human being, organizational identity is derived also from the urges of the soul (atma), according to R. Goplalkrishnan, Executive Director, Tata Sons, a leading conglomerate of diversified businesses deeply committed to ethically and socially responsible ways of doing business.



Business is like a human being: The body dies and the soul lives on

The mission of the company is to purify the atma (soul) and not only to beautify the body.Organizations are thus driven to not only meet business goals but also live as responsible and ethical members of a complex social web. The call of the atma is to a higher purpose of existence and creation of sustainable value systems that endure with time. Organizations naturally evolve to looking beyond business bottom lines and living as responsible and ethical citizens of society.



Part VIII

Entertainment Industry


Emerging Segments: Entertainment

The PC/Console gaming market in India is estimated to grow at 156% from INR 0.85 billion in 2006 to INR 7.5 billion in 2010.The mobile gaming market in India is expected to grow from INR 1 billion in 2006 to INR 8.5 billion by 2010, a CAGR of 150%.The internet advertising industry is expected to grow from INR 1.6 billion in 2006 to INR 9.5 billion in 2011, a CAGR of 98%.The Live Entertainment market is expected to grow at 19% CAGR from INR 9.4 billion in 2006 to INR 22 billion in 2011.The out-of-home-media segment is set for exponential growth – from INR 10 billion in 2006 to INR 22 billion in 2011, a CAGR of 23%.Rising incomes, the recognition of India as a potential market by global events and a growing number of television and sports awards have fuelled this segment.However, issues like high entertainment tax, lack of world class infrastructure and unorganized company structures will check this industry.

Source: Mukta Arts Limited, ASAE India Study Mission Feb 2008


Key Developments: Entertainment

Consumer media needs are increasing qualitatively Digital Cinema emerging powerfully – approx 10% (1,200) cinemas have gone digital now and the number of digital cinemas are expected to overtake film by 2011Emergence of IPTV and Mobile TV platforms for distributionCAS implementation on the riseDirect-to-home market commences with a bang with 2 leading players offering DTH servicesAncillary revenues – Revenues of all digital rights of Cinema up by 20%Private Equity companies have acquired over INR 8.8 billion worth of ownership in Media companies in 2006 ONLY.



Issues facing the Entertainment Industry

Piracy– The sheer size of a country like India makes the piracy problem

assume different proportions.– There remains a lack of government initiative to fight this problem and

the anti-piracy and copyright laws are out of date. Furthermore, a lengthy legal and arbitration process is also a problem.

Addressability in TV– The governments inability to enforce addressability means that the

distribution system continues to be analog and fails to give consumers much choice.

– Subscription revenues to broadcasters and operators for this reason remain ‘foggy’.

Content Regulation– How will content be regulated in India? Who will regulate it? Will the

regulations be applied uniformly across mediums? These questions do not have appropriate answers as yet.



Part IX

Infrastructure


Infrastructure

Investments in Infrastructure have scaled up substantially over the last four years in IndiaInvestments in Infrastructure to increase from 4.6% of GDP to 8% of GDPAll arms of India’s Infrastructure expected to grow rapidly due to:– Huge demand from escalated activities– Increased private sector participation– Innovative sources of funding

Source: CII Initiative for the U.S. Delegates, Kshitiz Bhasker, Gammon, ASAE India Study Mission Feb 2008


Investment Outlay

SectorsAnticipated investment in 10th Plan

(FY02-FY07)Projected investment in 11th Plan

(FY07-FY12) Growth

US $bn % y-o-y

Electricity 70.5 150.4 113

Roads & Bridges 31.7 76.1 140

Telecom 22.5 65.1 190

Railways 20.3 62.2 207

Irrigation 32.1 53.1 65

Water & Sanitation 15.6 48.6 212

Ports 1.3 18 1266

Airports 2.1 8.5 295

Storage 2.3 5.5 137

Gas 2.1 5 135

Total 201 492 146



Construction GDP of India



Transport

Road:– Total Length 331,5231 Kms– National Highways 58,112 Kms– 1.7 % of the road network carries 40 % of all road traffic– 25 % of highway network suffers from congestion

Sea/Waterways:– Major Ports: 12– Minor Ports: 184

Air: – Total Number of airports: 124, International: 12– Demand for domestic air freight is growing by 7.8 % a year– Demand for international air freight is growing by 8.1 % a year

Rail: – Route Length 81000 Kms plus– Railways carry 30 % of the total freight


RoadsIndia has the second largest road network in the worldNational Highways (NH) with a total of 65,569 km in length, functions as the arterial network across the nationRoads carry about 61% of freight and 85% of passenger trafficHighways/ Expressways constitute about 66000 kms and carry 40% of road trafficIndia’s road network consists of:

Source- National Highways Authority of India (NHAI)


Roads

PPP in construction and operation of highways is on the rise.About 20 BOT projects, involving an investment of over 250 mn USD have been undertaken and toll is already being collected on 12 such projects.More than 80 % of the investment is expected to come from private sector.Contractors and Consultants from around 27 countries are already in India implementing the large highway projects

Source: NHAI


Ports

India has a coastline of 7,517 km having 12 major ports and 181 minor ports, out of which 139 are operational.Major ports are under the jurisdiction of the Central Government through the Port Trust of India and account for 3/4th of the total traffic

During 2006- 2007 463.84 MMT of total traffic was channeled through Major Ports



Ports

India has a coastline of 7,517 km having 12 major ports and 181 minor ports, out of which 139 are operational.Major ports are under the jurisdiction of the Central Government through the Port Trust of India and account for 3/4th of the total trafficDuring 2006- 2007 463.84 MMT of total traffic was channeled through Major Ports



World Trade – Asia RisingMomentum of growth in Developing Asia has shown an uptrend with Indian economy at No. 2 position after China



Air TravelAir Travel is the preferred mode of transport for millions of people

Domestic traffic has gone up by 48% in the current financial year

Indian Aviation Industry is expected to grow by 25% per annum

Airline Industry is facing tremendous growth in air traffic and AAI plans to invest 3.75mn USD to modernize non metro airports in the country



Airports

There are 449 airports in India. Among these the Airports Authority of India (AAI) owns and manages 5 international airports,87 domestic airports and 28 defense airfieldsMajor four airports at Mumbai, Delhi, Kolkatta & Chennai account for 63% of India’s passenger traffic & 78% of its freight traffic.Privatization of Delhi and Mumbai airports has been one of the significant reforms in the infrastructure sectorMinistry of Civil Aviation has proposed to develop non metro airports, state owned airports, Greenfield airports and Private airportsEstimated investment of about USD 100 mn for airport development over the next 5 years.



Rail



Rail

Railways in India contribute 2.3% of GDP.Railways is characterized by an expansive network, spreadacross 1,09,221 km encompassing about 6,947 stations and 17.7 million passengersRailways in India have witnessed a rise of 14% in gross earnings.Passenger earnings and freight earnings have grown 13.8% and 15% respectively.Upgrading the railway sector requires an investment of US $ 56 billion over the next 5 yearsAt least US $ 15 bn is anticipated to be sourced from debt and public private partnership



Rail Government has identified areas where private investmentswould be considered:– Dedicated Freight Corridor– Railway Station modernization– Manufacturing facilities for

locomotives– High speed passenger corridors– Container services

The planned eastern and western dedicated freight corridorproject is expected to have a budget of US $ 7.3 billionOver the next two years rail container operations sector is projected to witness an inflow of around US $ 2.43 billion for wagons, logistic parks and Inland Container Depots (ICD)



Railway TerminalsRailways preparing a blueprint to set up Greenfield railway terminals across the countryRailways would acquire and lease out the land to the private concessionaire and repossess the assets after the concession periodModernization of railway stations world class passenger terminalsModernization will also include setting up shopping and food plazas, budget hotels



Metro Rails in IndiaGovernment Funded– Kolkata Metro Rail– Delhi Metro Rail– Bangalore Metro Rail

On PPP Format– Hyderabad Metro Rail (Line I,

II & III)– Kochi Metro Rail– Mumbai Metro Rail (Phase I, II

& III)– Delhi Airport Metro Rail Link– Chandigarh monorail

(planned)– Chennai monorail (planned)



Airport Link Mass Rapid Transit Systems

Delhi International Airport Link

Bangalore International Airport Link

Hyderabad International Airport Link

Cochin International Airport Link



PowerIndia is the sixth largest energy consumer, accountable for about 3% of the world’s total energy per year. Electricity consumption in India amounts to 587.9 billion Kw and is expected to increase by approximately 4.5 % up to 2020.India has a power shortage of 12% at peak level.Govt. of India has set up a target of 100,000 MW capacity addition over 2002-2012 to contain power shortage.Ongoing huge Investments in Transmission & Distribution required to augment the planned generation capacity and overhauling the outdated & inefficient infrastructure



Hydro power opportunity being given renewed thrust. More than 35% of the planned capacity addition during the tenth plan is in hydro power.

Investors are active in this industry from 1991 when the Industry was opened to private participation

Generation and distribution of power projects of all types and sizes are permitted.

Foreign equity participation of 100% is permitted

Power



Total Installed Capacity



PowerOut of total power generation, State and Central Government account for 58% and 32% respectively, whereas private sector accounts for only 10%

Power generation capacity is anticipated to increase by about 60,000 MW during 2007-12



All India Generating Installed Capacity (MW) as of 31 July 2007

Source: Ministry of Power, CII Initiative for the U.S. Delegates, Kshitiz Bhasker, Gammon, ASAE India Study Mission Feb 2008


Huge power investments led by increased focus on power reforms

Source: IDFC-SSKI Research; Plan Documents, CII Initiative for the U.S. Delegates, Kshitiz Bhasker, Gammon, ASAE India Study Mission Feb 2008


Water Supply and Sanitation FacilitiesIncreased urbanization in the country has led to a focus on addressing the backlog in investment in water and sanitation facilitiesProjected Investment in water supply and sanitation in the Eleventh Plan (INR Bn)



Urban WSS Investment required for meeting the MDG



Infrastructure Finance in IndiaNo longer solely a prerogative of the governmentPublic Private Partnerships have rolled out projects successfullySome of the private investment takes the form of equity, debt accounts for most of the totalLending by banks to infrastructure projects grew from 2 % to 15.5 % in the past seven years up to 2005Corporate bonds have also been the most common form of infrastructure finance. Foreign investment in the domestic corporate-bond market is restricted to a total ceiling of $1.5 billion.The recent phenomenon of globalizing financial flows, which has integrated the financial markets all over the world, has often been seen as a solution towards financing long-term capital investments in infrastructure projects.Multilateral agencies like World Bank and Asian Development Bank are also funding various infrastructure projects in IndiaPrivate Equity investors are also keen to invest in infrastructure projects looking at the luring returns



Bank Lending to Infrastructure on the Rise

Source: RBI, CII Initiative for the U.S. Delegates, Kshitiz Bhasker, Gammon, ASAE India Study Mission Feb 2008


Part XMegacities


Wealth

Source: June 2007 IEEE Spectrum ‘Megacities’


Air Pollution

Particulate matter smaller than 10 micrometers in diameter (pm10) is the most dangerous to human health, because it can pass through the nose and throat and enter the lungs—leading to asthma, lung cancer, cardiovascular problems, and premature death.



Services



A tangle of wires bring electricity to shops in Mumbai’s bustling Crawford Market – Photograph by Elton Iron



Local power failures - such as this one in June 2006, when an entire neighborhood was plunged into darkness – might be a harbinger of things to come – Photograph by Michael Kohli



Birds on wires, attracted to garbage, in slums like Dharavi, often cause shorts that knock out power in entire neighborhoods.

Photograph by Adrian Fisk



Engineers at Tata Power Co.’s Trombay thermal power plant monitor generators and the grid from the control room - Photograph by Harry Goldstein



This simple model at Tata Powers Co.’s load dispatch center was created to help visitors understand Tata’s islanding scheme. In this picture, the Maharashtra state grid and the Mumbai grid are in perfect harmony, at the specified frequency of 50 hertz, a situation that never exists in reality. - Photograph by Harry Goldstein



Part XI

Appendices


Part XI

Part A. Demographic Appendices


I. Distribution of Workers by Population (States 1-19)

S.No. State / UT

Total Worker Main Worker Marginal Worker

Person Male Female Person Male Female Person Male Female

1 India 402,234,724 275,014,476 127,220,248 313,004,983 240,147,813 72,857,170 89,229,741 34,866,663 54,363,078

2 Andaman & Nicobar Islands

136,254 109,162 27,092 113,607 97,349 16,258 22,647 11,813 10,834

3 Andhra Pradesh 34,893,859 21,662,192 13,231,667 29,040,873 19,455,492 9,585,381 5,852,986 2,206,700 3,646,286

4 Arunachal Pradesh 482,902 293,612 189,290 415,007 267,384 147,623 67,895 26,228 41,667

5 Assam 9,538,591 6,870,960 2,667,631 7,114,097 5,849,032 1,265,065 2,424,494 1,021,928 1,402,566

6 Bihar 27,974,606 20,483,003 7,491,603 21,052,875 17,511,018 3,541,857 6,921,731 2,971,985 3,949,746

7 Chandigarh 340,422 284,419 56,003 328,989 277,050 51,939 11,433 7,369 4,064

8 Chhattisgarh 9,679,871 5,531,859 4,148,012 7,054,595 4,742,935 2,311,660 2,625,276 788,924 1,836,352

9 Dadra & Nagar Haveli 114,122 75,835 38,287 96,184 71,156 25,028 17,938 4,679 13,259

10 Daman & Diu 72,791 60,569 12,222 67,522 58,874 8,648 5,269 1,695 3,574

11 Delhi 4,545,234 3,960,101 585,133 4,317,516 3,794,345 523,171 227,718 165,756 61,962

12 Goa 522,855 375,218 147,637 425,305 326,993 98,312 97,550 48,225 49,325

13 Gujarat 21,255,521 14,477,286 6,778,235 17,025,074 13,480,566 3,544,508 4,230,447 996,720 3,233,727

14 Haryana 8,377,466 5,715,526 2,661,940 6,241,324 4,933,004 1,308,320 2,136,142 782,522 1,353,620

15 Himachal Pradesh 2,992,461 1,686,658 1,305,803 1,963,882 1,333,361 630,521 1,028,579 353,297 675,282

16 Jammu & Kashmir 3,753,815 2,679,941 1,073,874 2,608,668 2,226,958 381,710 1,145,147 452,983 692,164

17 Jharkhand 10,109,030 6,659,856 3,449,174 6,446,782 5,134,067 1,312,715 3,662,248 1,525,789 2,136,459

18 Karnataka 23,534,791 15,235,355 8,299,436 19,364,759 13,896,845 5,467,914 4,170,032 1,338,510 2,831,522

19 Kerala 10,283,887 7,765,645 2,518,242 8,236,973 6,460,693 1,776,280 2,046,914 1,304,952 741,962

Source: Indian Census 2001.


II. Distribution of Workers by Population (States 20-36)

Source: India Census 2001.

S.No. State / UT

Total Worker Main Worker Marginal Worker

Person Male Female Person Male Female Person Male Female

20 Lakshadweep 15,354 13,204 2,150 11,710 10,288 1,422 3,644 2,916 728

21 Madhya Pradesh 25,793,519 16,194,368 9,599,151 19,102,572 14,056,279 5,046,293 6,690,947 2,138,089 4,552,858

22 Maharashtra 41,173,351 26,852,095 14,321,256 34,748,053 24,416,295 10,331,758 6,425,298 2,435,800 3,989,498

23 Manipur 945,213 527,216 417,997 659,364 430,227 229,137 285,849 96,989 188,860

24 Meghalaya 970,146 568,491 401,655 757,011 485,694 271,317 213,135 82,797 130,338

25 Mizoram 467,159 263,008 204,151 362,450 225,428 137,022 104,709 37,580 67,129

26 Nagaland 847,796 488,968 358,828 703,977 424,811 279,166 143,819 64,157 79,662

27 Orissa 14,276,488 9,802,006 4,474,482 9,589,269 8,004,740 1,584,529 4,687,219 1,797,266 2,889,953

28 Pondicherry 342,655 258,670 83,985 317,367 245,205 72,162 25,288 13,465 11,823

29 Punjab 9,127,474 6,960,213 2,167,261 7,835,732 6,426,028 1,409,704 1,291,742 534,185 757,557

30 Rajasthan 23,766,655 14,695,802 9,070,853 17,436,888 12,841,318 4,595,570 6,329,767 1,854,484 4,475,283

31 Sikkim 263,043 165,716 97,327 212,904 146,541 66,363 50,139 19,175 30,964

32 Tamil Nadu 27,878,282 18,100,397 9,777,885 23,757,783 16,303,310 7,454,473 4,120,499 1,797,087 2,323,412

33 Tripura 1,159,561 831,346 328,215 912,292 742,054 170,238 247,269 89,292 157,977

34 Uttar Pradesh 53,983,824 40,981,558 13,002,266 39,337,649 34,338,260 4,999,389 14,646,175 6,643,298 8,002,877

35 Uttaranchal 3,134,036 1,996,177 1,137,859 2,322,347 1,639,242 683,105 811,689 356,935 454,754

36 West Bengal 29,481,690 22,388,044 7,093,646 23,023,583 19,494,971 3,528,612 6,458,107 2,893,073 3,565,034


Part XI

Part B. Economic and Financial Appendices


I. Real Expenditure on GDP

Source: "Country Data, Gross Domestic Product India (February 2008)," Economist Intelligence Unit.* All units in LCU and billions, unless otherwise noted.

Title 2004 2005 2006 2007 2008 2009 2010 Source

Real GDP 26022.4 28424.8 31083.6 33494.2 35993.4 38568.3 41399.4 Central Statistical Organization

Real private consumption

15691.3 16750.3 17787 18786 19849.4 21117 22440.9 Central Statistical Organization

Real government consumption

2787.6 3060.9 3337.1 3696.59 4066.25 4350.89 4742.47 Central Statistical Organization

Real gross fixed investment


Real stock building 466.3 788.2 868.4 899.54 900 900 900 Central Statistical Organization

Real exports of G&S 4699 4976.8 5407.2 5706.16 6128.9 6664.96 7289.99 Central Statistical Organization

Real imports of G&S 4115.4 4539.2 5058.7 5534.11 6095.33 6834.64 7704.72 Central Statistical Organization

Real domestic demand 25518.4 28177.5 30678.7 33322.2 35959.9 38738 41814.1 Derived from Central Statistical Organization

Real GDP (PPP US$ at 2005 prices)

2226.32 2431.85 2659.32 2865.56 3079.38 3299.67 3541.88 EIU calculation

Real GDP (US$ at 2005 prices)

737.492 805.577 880.93 949.248 1020.08 1093.05 1173.29 EIU calculation

Real private consumption (US$ at

2005 prices)

436.78 466.258 495.116 522.924 552.524 587.809 624.66 EIU calculation


II. Real Government Consumption, Real Expenditures on GDP

Source: "Country Data, Gross Domestic Product India (February 2008)," Economist Intelligence Unit.* All units in LCU and billions, unless otherwise noted.

Title 2004 2005 2006 2007 2008 2009 2010 Source

Real government consumption (US$ at 2005 prices)

83.194 91.351 99.594 110.322 121.355 129.849 141.536 EIU calculation

Real gross fixed investment (US$ at 2005 prices)

209.93 249.497 284.934 323.255 359.18 395.738 436.316 EIU calculation

Real exports of G&S (US$ at 2005 prices)

154.614 163.754 177.916 187.752 201.662 219.301 239.866 EIU calculation

Real imports of G&S (US$ at 2005 prices)

170.078 187.593 209.062 228.71 251.903 282.457 318.415 EIU calculation

Real domestic demand (US$ at 2005 prices)

729.904 807.106 879.644 956.501 1033.06 1113.4 1202.51 EIU calculation

Rebasing residual (US$ at 2005 prices)

23.052 22.31 32.432 33.704 37.261 42.812 49.324 EIU calculation

GDP (% real change) 8.325 9.232 9.354 7.8 7.5 7.2 7.3 Derived from Central Statistical Organization

Private consumption (% real change)

5.379 6.749 6.189 5.6 5.7 6.4 6.3 Derived from Central Statistical Organization

Government consumption (% real change)

5.407 9.804 9.023 10.8 10 7 9 Derived from Central Statistical Organization

Gross fixed investment (% real change)

11.772 15.288 14.622 14.4 12.1 11 11 Derived from Central Statistical Organization


III. Real Expenditures on GDP (Cont’d), Contribution to Real GDP Growth

Source: "Country Data, Gross Domestic Product India (February 2008)," Economist Intelligence Unit.* All units in LCU and billions, unless otherwise noted. * All data derived from India’s Central Statistical Organization.

Title 2004 2005 2006 2007 2008 2009 2010

Exports of G&S (% real change) 28.132 5.912 8.648 5.5 7.4 8.7 9.4

Imports of G&S (% real change) 12.305 10.298 11.445 9.4 10.1 12.1 12.7

Domestic demand (% real change) 8.283 10.42 8.877 8.6 7.9 7.7 7.9

Private consumption, contribution to real GDP growth (% points)

3.334 4.07 3.647 3.2 3.2 3.5 3.4

Government consumption, contribution to real GDP growth (% points)

0.595 1.05 0.972 1.2 1.1 0.8 1.0

Gross fixed investment, contribution to real GDP growth (% points)

2.882 3.862 3.898 4.0 3.6 3.4 3.5

Stock building, contribution to real GDP growth (% points)

1.315 1.237 0.282 0.1 359.18 395.738 436.316

External balance, contribution to real GDP growth (% points)

2.418 -0.561 -0.313 -0.6 -0.4 -0.6 -0.6


IV. Nominal Expenditure on GDP

Source: "Country Data, Gross Domestic Product India (February 2008),“ Economist Intelligence Unit.* All units in LCU and billions, unless otherwise noted.

Title 2004 2005 2006 2007 2008 2009 2010 Source

Nominal GDP 31266.0 35671.8 41257.3 46240.0 52413.5 59785.1 67827.6 Central Statistical Organization

Nominal private consumption


Nominal government consumption


Nominal gross fixed investment

8227.9 10007.6 12165.5 14617.6 17208 20055.9 23375.1 Central Statistical Organization

Nominal GDP (US$ at PPP)

2161.13 2431.85 2743.28 3031.18 3326.18 3660.72 4032.7 EIU calculation. Based on figures from World Bank,

World Development Indicators.

Nominal GDP (US$) 692.737 805.578 922.757 1131.38 1380.44 1649.53 1914.68 Derived from Central Statistical Organization

Nominal private consumption (US$)


Nominal government consumption (US$)


Nominal gross fixed investment (US$)


Nominal stock building (US$)



V. Nominal Expenditure on GDP, Structure of GDP

Source: "Country Data, Gross Domestic Product India (February 2008)," Economist Intelligence Unit.* All units in LCU and billions, unless otherwise noted. * All data derived from India’s Central Statistical Organization.

Title 2004 2005 2006 2007 2008 2009 2010

Nominal exports of G&S (US$) 126.08 163.754 212.0 250.007 295.267 338.3 385.59

Nominal imports of G&S (US$) 138.687 187.593 238.11 285.296 341.536 376.771 422.876

Nominal domestic demand (US$) 685.685 807.106 924.204 1166.67 1426.71 1688.0 1951.97

Private consumption (% of GDP) 59.67 57.879 56.41 56.8 55.8 54.5 53.3

Government consumption (% of GDP)

10.956 11.34 11.336 11.9 12.2 12.1 12.3

Gross fixed investment (% of GDP) 26.316 28.055 29.487 31.6 32.8 33.5 34.5

Stock building (% of GDP) 2.04 2.917 2.924 2.8 2.5 2.2 1.9

Exports of G&S (% of GDP) 18.2 20.328 22.975 22.1 21.4 20.5 20.1

Imports of G&S (% of GDP) 20.02 23.287 25.804 25.2 24.7 22.8 22.1

Domestic demand (% of GDP) 98.982 100.19 100.157 103.1 103.4 102.3 101.9


VI. GDP Deflators

Source: "Country Data, Gross Domestic Product India (February 2008)," Economist Intelligence Unit. * All data derived from India Central Statistical Organization.

Title 2004 2005 2006 2007 2008 2009 2010

GDP deflator (2005=100; av.) 95.741 100.0 105.765 110.0 116.0 123.5 130.6

GDP deflator (% change; av.) 4.369 4.449 5.765 4.0 5.5 6.4 5.7

Private consumption deflator (2005=100; av.)

96.46 100.0 106.153 113.4 119.5 125.2 130.7

Private consumption deflator (% change; av.)

3.571 3.669 6.153 6.8 5.4 4.7 4.5

Government consumption deflator (2005=100; av.)

92.982 100.0 106.052 112.8 119.4 126 132.6

Government consumption deflator (% change; av.)

4.612 7.547 6.052 6.4 5.8 5.5 5.2

Fixed investment deflator (2005=100; av.)

94.786 100.0 106.055 111.4 116.9 122.8 128.9

Fixed investment deflator (% change; av.)

7.128 5.501 6.055 5.0 5.0 5.0 5.0

Export deflator (2005=100; av.) 83.116 100.0 120.314 122.9 125.5 126.3 128.6

Export deflator (% change; av.) 8.904 20.314 20.314 2.2 2.2 0.6 1.9

Import deflator (2005=100; av.) 83.114 100.0 115 115.1 116.3 109.2 106.2

Import deflator (% change; av.) 25.703 20.317 15 0.1 1.0 -6.1 -2.7


VII. Origin of GDP, National Savings

Source: "Country Data, Gross Domestic Product India (February 2008)," Economist Intelligence Unit. * All units in LCU and billions, unless otherwise noted.

Title 2004 2005 2006 2007 2008 2009 2010 Source

Real GDP at factor cost


Real agriculture 4830.8 5121.47 5258.75 5395.48 5519.57 5629.96 5742.56 Central Statistical Organization

Real industry 6233.27 6830.28 7576.41 8311.32 9059.34 9765.97 10498.4 Central Statistical Organization

Real manufacturing 3611.15 3939.56 4425.03 4880.81 5334.72 5777.5 6239.71 Central Statistical Organization

Real services 12832.5 14093.6 15646.4 17038.9 18538.4 20114.1 21884.2 Central Statistical Organization

Agriculture (% real change)

-0.04 6.017 2.68 2.6 2.3 2.0 2.0 Derived from Central Statistical Organization

Industry (% real change)


Manufacturing (% real change)


Services (% real change)


Gross national savings rate (%)

28.355 29.822 30.951 32.7 32.8 34.1 34.7 Derived from IMF, International Financial

Statistics

Gross national savings/investment



VIII. Ratios, Growth and Productivity, Production Indicators

Source: "Country Data, Gross Domestic Product India (February 2008)," Economist Intelligence Unit. * All units in LCU and billions, unless otherwise noted.

Title 2004 2005 2006 2007 2008 2009 2010 Source

Agriculture/GDP 18.79 18.304 17.525 16.7 15.9 15.1 14.4 Derived from Central Statistical Organization

Industry/GDP 27.464 27.633 27.891 28.4 28.8 29.0 29.0 Derived from Central Statistical Organization

Services/GDP 53.746 54.063 54.583 54.9 55.3 55.9 56.6 Derived from Central Statistical Organization

Labor productivity growth (%)

6.4 6.8 6.7 5.3 5.0 4.7 5.0 EIU calculation

Total factor productivity growth (%)

4.8 5.2 4.9 3.0 2.6 2.3 2.6 EIU calculation

Growth of real capital stock (%)

7.8 8.8 9.6 10.4 10.6 10.7 10.7 EIU calculation

Growth of real potential output (%)

8.5 9.7 9.5 7.9 7.6 7.2 7.7 EIU calculation

Industrial production (2005=100; av.)

92.671 100.0 110.548 121.9 133.5 144.2 155.0 EIU calculation

Industrial production (% change pa)

8.471 7.909 10.548 10.2 9.5 8.0 7.5 Central Statistical Organization of India

Petroleum production (b/d)

780.0 798.0 800.0 820.0 840.0 850.0 870.0 International Energy Agency (IEA)

Petroleum reserves (barrels)

5700.0 5900.0 5700.0 5700.0 5700.0 5700.0 5800.0 OPEC Annual Statistical Bulletin


IX. Current Account of Foreign Payments

Source: "Country Data, Foreign payments India (February 2008)," Economist Intelligence Unit.•* All units in $US and millions, unless otherwise noted. •All data from the Reserve Bank of India.

Title 2004 2005 2006 2007 2008 2009 2010

Current-account balance 781.0 -10285.0 -9529.0 -15151.0 -31557.0 -25125.0 -30410.0

Goods: exports 77939.0 102175.0 122963.0 148165.0 171684.0 192739.0 217404.0

Goods: imports -105975.0 -149430.0 -185041.0 -222419.0 -260423.0 -284644.0 -318274.0

Trade balance -28036.0 -47255.0 -62078.0 -74254.0 -88739.0 -91905.0 -100869.0

Services: credit 38282.0 525270 71200.0 78758.0 92714.3 111743.0 131643.0

Services: debit -25206.0 -32549.0 -40160.0 -51500.0 -67208.0 -81316.0 -101942.0

Services: balance 13076.0 19978.0 31040.0 27258.0 25506.3 30427.2 29700.9

Income: credit 4690.0 5646.0 8223.0 13666.0 16034.6 18650.7 24133.5

Income: debit -8742.0 -12296.0 -13769.0 -17029.0 -21106.0 -26208 -34345.0

Income: balance -4052.0 -6650.0 -5546.0 -3363.0 -5071.4 -7557.1 -10212.0

Current transfers: credit 20615.0 24512.0 28377.0 36829.0 38724.6 46273.2 53711.4

Current transfers: debit -822.0 -870.0 -1322.0 -1621.0 -1977.7 -2363.2 -2741.2

Current transfers: balance 19793.0 23642.0 27055.0 35208.0 36746.9 43910.0 50970.2


X. Financing of Foreign Payments

Source: "Country Data, Foreign payments India (February 2008)," Economist Intelligence Unit. * All figures in US dollars and millions, unless otherwise noted.

Title 2004 2005 2006 2007 2008 2009 2010 Source

Financing requirement -13893.4 -25693.7 -17047.9 -28187.0 -46976.3 -42238.5 -48043.9 Derived from Reserve Bank of India

Principal repayments due -14674.4 -15408.7 -7518.9 -13036.0 -15419.2 -17113.7 -17633.8 World Bank, Global Development Finance.

M & LT debt inflows 21563.2 19613.8 20324.7 24500.0 23400.0 23300.0 23700.0 World Bank, Global Development Finance.

Commercial bank loans 6149.5 7903.5 10200.0 9000.0 7000.0 6000.0 6000.0 World Bank, Global Development Finance.

Officially guaranteed loans

8884.1 6641.4 5270.7 10000.0 10900.0 11800.0 12200.0 World Bank, Global Development Finance.

International bond issues 6529.5 5069.0 4854.0 5500.0 5500.0 5500.0 5500.0 World Bank, Global Development Finance.

Inward direct investment 5771.0 7606.0 19662.0 19866.0 25000.0 35000.0 40000.0 Reserve Bank of India

Outward direct investment -2179.0 -2978.0 -12842.0 -12997.0 -15000.0 -20000.0 -25000.0 Reserve Bank of India

Net direct investment flows


Inward portfolio investment)


Net portfolio investment flows



XI. Financing of Foreign Payments (Cont’d), International Reserve, Current Account Ratios

Source: "Country Data, Foreign payments India (February 2008),“ Economist Intelligence Unit.

Title 2004 2005 2006 2007 2008 2009 2010 Source

Change in international reserves

-28140.0 -5625.0 -40079.0 -99309.0 -36426.2 -37311.6 -43644.3 Derived from IMF, International Financial Statistics

Stock of inward foreign direct investment


Stock of outward foreign direct investment


International reserves 130401.0 136026.0 176105.0 275414.0

311840.0 349152.0 392796.0 Derived from IMF, International Financial Statistics

Foreign-exchange reserves

126593.0 131924.0 170738.0 267414.0

304840.0 342152.0 385796.0 IMF, International Financial Statistics

Gold, national valuation


Import cover (months) 11.929 8.97 9.384 12.1 11.4 11.4 11.2 Derived from IMF, International Financial Statistics

Current-account balance/GDP

0.113 -1.277 -1.033 -1.3 -2.3 -1.5 -1.6 Derived from Reserve Bank of India, Central Statistical

Organization of India

Trade balance/GDP -4.047 -5.866 -6.727 -6.6 -6.4 -5.6 -5.3 Derived from Reserve Bank of India, Central Statistical



XII. Current Account Ratios (Cont’d), Foreign Direct Investment Ratios

Source: "Country Data, Foreign payments India (February 2008)," Economist Intelligence Unit.

Title 2004 2005 2006 2007 2008 2009 2010 Source

Services balance/GDP 1.888 2.48 3.364 2.4 1.8 1.8 1.6 Derived from Reserve Bank of India, Central Statistical Organization of India

Income balance/GDP -0.585 -0.825 -0.601 -0.3 -0.4 -0.5 -0.5 Derived from Reserve Bank of India, Central Statistical Organization of India

Current-transfers balance/GDP

2.857 2.935 2.932 3.1 2.7 2.7 2.7 Derived from Reserve Bank of India, Central Statistical Organization of India

Inward foreign direct investment/GDP

0.833 0.944 2.131 1.8 1.8 2.1 2.1 Derived from IMF International Financial Statistics, Central Statistical


Inward foreign direct investment/gross fixed

investment



Stock of inward foreign direct investment per head

41.777 47.337 66.037 83 104.1 133.5 166.4 Derived from IMF International Financial Statistics, Central Statistical


Stock of inward foreign direct investment/GDP



Stock of outward foreign direct investment/GDP




XIII. Foreign Debt Stock and Ratios

Source: "Country Data, External debt stock India (February 2008),“ Economist Intelligence Unit.* All units in US dollars and millions, unless otherwise noted.


Total foreign debt 135098.0 146625.0 161660.0 World Bank, Global Development Finance.

Public medium & long term 84477.0 91120.0 98948.8 World Bank, Global Development Finance.

Private medium & long term 38649.5 44129.0 47491.5 World Bank, Global Development Finance.

Short term 11971.0 11376.0 15219.3 World Bank, Global Development Finance.

Total debt per head 123.3 132.0 144.0 Derived from IMF, International Financial Statistics; World Bank, Global Development

Finance.

Total debt/exports of G&S 59.231 53.2 50.8 Derived from IMF, International Financial Statistics; World Bank, Global Development

Finance.

Total debt/GDP 14.641 13.0 11.7 Derived from IMF, International Financial Statistics; World Bank, Global Development

Finance.

International reserves/total debt 130.354 187.8 192.9 Derived from IMF, International Financial Statistics; World Bank, Global Development

Finance.


XIV. Volume and Prices

Source: "Country Data, External trade India (February 2008)," Economist Intelligence Unit. * All units in US dollars, unless otherwise noted.

Title Units 2006 2007 2008 Source

Export volume of goods (% change) million 14.8 8.9 9.2 Reserve Bank of India

Import volume of goods (% change) million 21.3 9.2 10.1 Reserve Bank of India

Export volume of goods (2005=100) 114.8 125 136.5 EIU calculation

Import volume of goods (1996=100) million 121.3 132.4 145.7 EIU calculation

Export prices (US$, 2005=100) 102.1 112.3 122.3 EIU calculation

Import prices (US$, 2005=100) billion 108.7 117.9 127.5 EIU calculation

Export prices (% change pa; US$) billion 2.1 10.0 8.9 Reserve Bank of India

Import prices (% change pa; US$) billion 8.7 8.5 8.1 Reserve Bank of India

Terms of trade (1990=100) billion 115.9 117.5 118.4 Derived from Reserve Bank of India


XV. Budgetary Indicators

Source: "Country Data, Fiscal and monetary indicators India (February 2008),“ Economist Intelligence Unit.* All units in LCU and billions, unless otherwise noted.


Budget balance (% of GDP) -3.461 -3.4 -3.2 Derived from Ministry of Finance, India

Budget revenue 4401.99 5844.14 7116.84 Ministry of Finance, India

Budget expenditure 5829.92 7400.83 8809.83 Ministry of Finance, India

Budget balance -1427.93 -1556.68 -1692.99 Ministry of Finance, India

Debt interest payments 1495.53 1531.81 1711.06 Ministry of Finance, India

Primary balance 67.6 -24.874 18.073 Ministry of Finance, India

Public debt 24735.6 27292.3 29985.3 Derived from IMF, Government Finance Statistics Yearbook

Budget revenue (% of GDP) 10.67 12.6 13.6 Derived from Ministry of Finance, India

Budget expenditure (% of GDP) 14.131 16.0 16.8 Derived from Ministry of Finance, India

Debt interest payments (% of GDP)

3.625 3.3 3.3 Derived from Ministry of Finance, India

Primary balance (% of GDP) 0.164 -0.1 109.8 Derived from Ministry of Finance, India

Public debt (% of GDP) 59.955 59.0 57.2 Derived from IMF, International Financial Statistics


XVI. Money Supply and Interest Rates

Source: "Country Data, Fiscal and monetary indicators India (February 2008)," Economist Intelligence Unit.8 All units in LCU and billions, unless otherwise noted.


Stock of domestic credit 26143.0 32934.0 38286.0 IMF, International Financial Statistics

Domestic credit growth (%) 21.284 26.0 16.3 IMF, International Financial Statistics

Stock of money M1 8600.5 9939.2 11516 IMF, International Financial Statistics

Stock of quasi money 20361.0 26546.0 30898.0 IMF, International Financial Statistics

Stock of money M2 28962.0 36485.0 42414.0 Derived from IMF, International Financial Statistics

M1 (%) 19.237 15.6 15.9 Derived from IMF, International Financial Statistics

M2 (%) 21.647 26.0 16.3 Derived from IMF, International Financial Statistics

Lending interest rate (%) 11.217 13.1 12.8 IMF, International Financial Statistics

Deposit interest rate (%) 7.213 7.5 7.1 Reserve Bank of India

Money market interest rate (%) 6.0 6.0 5.8 Reserve Bank of India

Long-term bond yield (%) 7.6 7.9 7.5 Bloomberg

Consumer prices (% change; av.) 6.177 6.4 5.8 Labor Bureau of India

Consumer price index (av.) 122.92 130.8 138.4 Labor Bureau of India

Consumer price index (2005=100; av.) 106.18 113.0 119.6 EIU calculation


XVII. Money Supply and Interest Rates (Cont’d)

Source: "Country Data, Fiscal and monetary indicators India (February 2008),“ Economist Intelligence Unit.* All units in LCU and billions, unless otherwise noted.


Consumer price index (end-period) 126.968 133.8 141.4 Labor Bureau of India

Consumer prices (% change pa; end-period) 6.884 5.4 5.7 Labor Bureau of India

Producer prices (% change; av.) 4.819 4.864 4.7 Ministry of Commerce and Industry

Producer price index (av.) 203.017 212.892 222.9 Ministry of Commerce and Industry

Producer price index (2005=100; av.) 104.819 109.917 115.1 EIU calculation

Average nominal wage index (LCU, 2005=100)


Average nominal wages (% change) 9 9.5 8.1 ILO Yearbook of Labor statistics

Average real wage index (LCU, 2005=100) 102.7 105.7 107.9 EIU calculation

Average real wages (% change) 2.7 2.9 2.1 Derived from ILO labor statistics

Unit labor cost index (US$, 2005=100) 100.2 114.7 128.2 EIU calculation

Unit labor costs (% change pa) 0.2 14.5 11.7 EIU calculation

Labor costs per hour 0.6 0.75 0.92 Derived from ILO labor statistics


XVIII. Quarterly Indicators: GDP

Source: "Country Data, Quarterly indicators India (February 2008),“ Economist Intelligence Unit.* All units in LCU and billions, unless otherwise noted.


Real GDP 7879.53 7044.08 7189.65 8216.66 8633.2 7693.42 7820.69 Central Statistical Organization, India

Real GDP (US$ at 1996 prices)

221.716 198.208 202.304 231.203 242.923 216.48 220.061 EIU calculation

GDP (% real change)

10.903 8.113 10.729 9.021 9.565 9.218 8.777 Derived from Central Statistical Organization, India

GDP (% real change period-

on-period)

4.547 -10.603 2.067 14.285 5.069 -10.886 1.654 Derived from Central Statistical Organization, India

Nominal GDP 9896.54 9126.93 9532.03 11026.8 11571.5 10605.1 10801.7 Central Statistical Organization, India

Nominal GDP (US$)

222.883 200.721 205.563 245.125 261.962 257.191 266.545 Derived from Central Statistical Organization, India


XIX. Quarterly Indicators: Output and Demand, Exchange Rate, Budget

Source: "Country Data, Quarterly indicators India (February 2008),“ Economist Intelligence Unit.* All units in LCU and billions, unless otherwise noted.


Industrial production index

239.033 232.5 237.933 248.833 268.933 256.367 258.433 Central Statistical Organization of India

Industrial production (1996=100; av.)

110.298 107.283 109.79 114.82 124.094 118.296 119.249 EIU calculation

Industrial production (% change)

8.734 10.451 11.811 11.219 12.509 10.265 8.616 Derived from Central Statistical Organization of India

Petroleum production (b/d)

770.0 790.0 770.0 820.0 820.0 855.652 798.609 OPEC, Annual Statistical Bulletin; Oil and Gas Journal; IEA

Budget balance (% of GDP)

-3.85 -8.518 -0.915 -0.761 -4.143 -10.599 2.889 Derived from IMF, International Financial Statistics

Budget revenue 1355.23 537.3 1117.53 1233.84 1513.32 674.96 1691.96 IMF, International Financial Statistics

Budget expenditure 1736.24 1314.7 1204.74 1317.77 1992.71 1799.0 1379.92 Derived from IMF, International Financial Statistics

Budget balance (mil.) -381.01 -777.4 -87.21 -83.93 -479.39 -1124.04 312.04 Derived from IMF, International Financial Statistics

Budget revenue (% of GDP)

13.694 5.887 11.724 11.19 13.078 6.364 15.664 Derived from IMF, International Financial Statistics

Budget expenditure (% of GDP)

17.544 14.405 12.639 11.951 17.221 16.964 12.775 Derived from IMF, International Financial Statistics


XX. Quarterly Indicators: Money Supply and Interest Rate

Source: "Country Data, Quarterly indicators India (February 2008),“ Economist Intelligence Unit.* Blank cells denote unavailability of information.* All units in LCU and billions, unless otherwise noted.

Title 2006Q1 2006Q2 2006Q3 2006Q4 2007Q1 2007Q2 2007Q32007Q

4 Source

Stock of domestic credit

23470.3 23864.7 25389.9 26143 IMF, International Financial Statistics

Lending interest rate (%)

10.8 11.133 11.433 11.5 12.333 13.3 13.3 11.5 IMF, International Financial Statistics

Deposit interest rate (%)

5.833 5.833 5.833 5.833 5.833 5.833 5.833 5.833 Reserve Bank of India

Money market interest rate (%)

5.5 5.75 6.0 6.0 6.0 6.0 6.0 6.0 MMkt Rate: Bombay Interbank

(%)

Consumer prices (% change; av.)


Consumer price index (av.)

119 121.333 124.333 127 127.333 129 132.667 Reserve Bank of India

Consumer price index (1996=100;

av.)

102.794 104.809 107.401 109.704 109.992 111.432 114.599 EIU calculation

Producer prices (% change; av.)

3.987 4.575 5.11 5.563 6.446 5.519 4.262 3.338 Reserve Bank of India


XXI. Quarterly Indicators: Financial Indicators

Source: "Country Data, Quarterly indicators India (February 2008),“ Economist Intelligence Unit.* Blank cells denote unavailability of information.* All units in US dollars and millions, unless otherwise noted.


Stock market index 11280.0 10609.3 12454.4 13786.9 13072.1 14650.5 17291.1 BSE Sensex 30 Share Price Index (1978/79=100) LCU

Change in $ value of stock market index (%

pa)

70.419 42.341 38.073 49.42 18.573 52.763 60.568 Derived from BSE Sensex 30 Share Price Index

(1978/79=100) LCU

Change in $ value of stock market index (%

period-on-period)

21.264 -6.947 15.17 14.977 -3.771 19.884 21.054 Derived from BSE Sensex 30 Share Price Index

(1978/79=100) LCU

Assets with BIS-reporting banks

71566.0 68407.0 74680.0 84147.0 BIS, International Banking and Financial Market Developments

Liabilities with BIS-reporting banks

63416.0 59599.0 66755.0 73741.0 BIS, International Banking and Financial Market Developments

Current-account balance 2.756 -4.567 -4.83 -2.775 IMF, International Financial Statistics


XXII. Quarterly Indicators: International Reserve and External Trade

Source: "Country Data, Quarterly indicators India (February 2008),“ Economist Intelligence Unit.* Blank cells denote unavailability of information.* All units in US dollars and millions, unless otherwise noted.


International reserves

150.56 162.63 164.17 176.11 Derived from IMF, International Financial

Statistics

Foreign-exchange reserves


Gold, national valuation

4.702 5.898 5.068 5.367 IMF, International Financial Statistics

Trade balance -12.06 -10.92 -13.73 -17.17 -14.29 -20.33 -17.34 Asian Development Bank, Key Indicators of Developing Asian and

Pacific Countries

Total exports 27.621 30 32.525 30.668 31.855 36.343 38.22 Derived from Reserve Bank of India

Total imports 39.684 40.923 46.25 47.833 46.149 56.672 55.561 Derived from Reserve Bank of India


Part XI

Part C. Legal and Business Issues in India Appendices


Legal and Business Issues Additional Reference

http://www.pwc.com/Extweb/pwcpublications.nsf/docid/CF885179A4044DA3CA257181006A141E http://www.usig.org/countryinfo/india.asphttp://law.incometaxindia.gov.in/Directtaxlaws/cbdt/dta/A1_USA.htmhttp://aar.gov.in/http://mca.gov.inhttp://www.rbi.org.in



NEW SLIDES


New Outsourcing

The global economy has been their jobs to IndiaRising wages, stronger currency, demands for workers who speak languages other than English and competition from countries emulating India’s ‘back office’ are challenging the modelIndian companies are opening offices in developing countries before their competitors doExamples:– Infosys: Mexico, Czech Republic, Thailand, China– Tata: Brazil, Chile, Uruguay– Cognizant Technology Solutions: Phoenix, Shanghai– Wipro: Canada, China, Portugal, Romania, Saudi Arabia

Source: “Outsourcing Works, So India is Exporting Jobs (25 September 2007),“ New York Times.


New Outsourcing

India continues to be the No. 1 location for outsourcing

Though work that bypasses India remains smail, it is growing

Infosys Example: – American band wanted a computer system to handle a

loan program for Hispanic customers

– A0 company in the US paid Infosys who is 7,000 miles away to supply it with Mexican engineers working 150 miles south of the US border

Source: “Outsourcing Works, So India is Exporting Jobs (25 September 2007),“ New York Times.


Thirsting for Energy

Energy consumption in this country of 1.1 billion is expected to quadruple over the next 25 yearsAlmost half of India’s population has no access ot the electricity grid, others go hours without powerApprox 700M rely on animal waste and firewood for fuel for cooking– As a result India’s per capita carbon footprint remains a small fraction

of that of the industrialized world – the average American produces 16 times the emissions of the average Indian

India’s total emissions are the fourth largest in the world, after the United States, China and RussiaThe Indian Government has yet to unveil its long-awaited climate change policyIn India’s growth, many environmentalists see opportunity for energy efficiency

Source: “Thirsting for Energy in India’s Boomtowns and Beyond (2 March 2008),“ New York Times.

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