Now, VCs to invest in rural tech

Venture capitals (VC) in India, which traditionally invested in urban segments or technology sector, have begun investing in rural-centric technology firms. Avishkaar India Micro Venture Capital Fund, Acumen Fund, and Rural Innovations Network (RIN) are showing increased focus on rural markets.

A non-profit investment firm E+Co, with investments in 28 countries, plans to begin operations in India. The firm with $183 million capital mobilised and $24.6 million investment portfolio will focus on clean technology.

“India has very few funds that look at investing in rural India. But what’s heartening to see is that the sector now has a few options and entrepreneurs can approach for investment,” said Arun Natarajan, MD and CEO, Venture Intelligence.

Most of these VCs get their funding from philanthrophic activities. RIN gets funding from donors such as HIVOS, The Lemelson Foundation, Sir Dorabji Tata Trust, and The Rockefeller foundation. Whereas Google, Gates, Cisco and others form the investor base for the Acumen Fund.

Acumen India has been in the country since 2005 and has invested in 12 entrepreneurs. The focus is to fund innovative businesses that target the poor as consumers and demonstrate to the world the sustainable ways of bringing access to critical goods and services such as healthcare, water, housing and energy to low-income households.

So far, Acumen India’s total approved investment is $17.4 million.

“Our capital commitments range from $3,00,000 to $20,00,000 in equity or debt with a payback or exit in roughly five to seven years. Our average investment is about $1 million. We also do follow-on investments as our portfolio companies’ scale — leading to anywhere up to $4-5 million exposure to a given company,” said Clara Bardy, India Portfolio Associate, Acumen Fund.

October adds highest ever mobile subscribers at 10.42 million

During these times of cutbacks there's one thing which Indians are buying in abundance-mobile connections. During the month of October the country added the highest-ever addition to the mobile subscriber base at 10.42 million taking the total number of mobile users to over 325 million, according to the data released by the Telecom Regulatory Authority of India (Trai). India already has the distinction of being the world’s fastest growing telecom market.

During the month of September, the total (GSM, CDMA and WLL) addition was of 10.07 million.

However, the net addition of about 10.29 million users (wireline and wireless) during the month, could have been higher but for the decline in the landline user base. The landline wireline segment saw the subscriber base falling to 38.22 million in October from 38.35 million in September. During September the net addition stood at 9.79 million. The total number of both wireless and wireline users now stand at 363.95 million, Trai said.

With this, the overall tele-density stood at 31.50% at the end of October against 30.64% in September. The total broadband subscriber base rose to 5.05 million by the end of October 2008 from 4.90 million in September.

In terms of break-up of the mobile subscriber figures, during October the GSM players added their highest-ever addition of around 8 million taking their user base to 242 million. Projections are that by the year end the total GSM user base would stand at 250 million.

Commenting on the record growth, TV Ramachandran, director general, Cellular Operators Association of India had earlier said, “the ongoing, vibrant growth of the GSM sector that with the cumulative GSM subscribers already at an estimated 242 million in October, it is clear that the GSM sector would by itself cross the historic 250 million milestone by December 2008.”

Bharti Airtel, the country's largest telecom operator added its highest-ever 2.7 million customers during October, which is a 3.51% growth compared to the month of September. The world’s third largest in-country operator has a market share of 33.23%. It added the largest number of operators in the Rajasthan circle, adding a 350,000 subscribers during the month.

Vodafone Essar, the country's second largest GSM operator with a market share of 23.49% added around 2 million customers in the month registering a growth rate of 3.81%. The company recorded a highest addition of around 266,000 subscribers in Eastern UP circle.

The state-owned BSNL, the country's second largest telecom player with about 670,000 users, during the period registered a growth of 1.71% over the previous month. The telco has a market share of 16.5% in the GSM subscribers. Among the CDMA operators, Reliance Communications, which is the largest operator in the segment, added 1.7 million subscribers.

Fast dialling

• Total number of both wireless and wireline users now stand at 363.95 million
• With this, the overall tele-density stood at 31.50% at the end of October against 30.64% in September
• The total broadband subscriber base rose to 5.05 million by the end of October 2008 from 4.90 million in September.

8 Indian supercomps in world's top 500 list

 Bangalore: Hewlett Packard (HP), the world’s biggest maker of personal computers, on Friday said that a total of eight entries in the list of top 500 supercomputers are from India and six out of the eight entries are from HP. Among vendors, HP leads the list with a 41.8 % share of the systems, followed by IBM (37%), Dell (4%) and Cray (4%).

Supercomputer Eka, a HP-based system with a performance of 132.8 teraflops (floating point operations per second) has been ranked at number 13. Eka belongs to the Tata Group’s Computational Research Laboratories.

The rankings are released twice a year by researchers at the Universities of Tennessee and Mannheim, Germany, and at NERSC Lawrence Berkeley National Laboratory. The HP-based Param cluster of the Centre for Development of Advanced Computing has been ranked 68th.

The other supercomputers by HP from India are for an industrial research company (334), a research agency (428), IIT-Madras (436) and Paprikaas Interactive Services (478).

The two other supercomputers from India out of the eight in the list include IBM’s eServer Blue Gene Solution for Indian Institute Science ranked at 213 and a supercomputer for Digital Media Company (G) ranked at 481.

IBM’s Roadrunner has been ranked as number one in the list. The system, only the second to break the petaflop barrier, posted a top performance of 1.059 petaflops. One petaflop represents one quadrillion floating point operations per second. 

'Changemakers' award for NGO

Two financial initiatives of the Dakshina Kannada-based non-governmental organisation Shri Kshethra Dharmasthala Rural Development Project (SKDRDP) - 'Pragathibandhu' and 'Sampoorna Suraksha' - have won the 'Changemakers' award in the competition 'Banking on social change - seeking financial solutions for all'. The award is promoted jointly by the US-based Ashoka Foundation and Citibank.

A press release by the SKDRDP said here on Wednesday that 'Pragathibandhu' model provides an alternative methodology to finance the farming activities of the small farmers. In this initiative small farmers come together to share and learn.

The model has successfully been implemented in coastal and malnad districts in Karnataka consisting of 1.32 lakh small farmers who have been organised in 23,300 self-help groups, it said.

'Sampoorna Suraksha' is a self-financing multipurpose insurance product to protect the poor against hospitalisation expenses, maternity, death, domiciliary treatment and accidents.

Giving details about the competition, the release said that the Web-based competition evoked response from 280 institutions across 43 countries. On December 1, three models comprising the 'Pragathibandhu', 'Sampoorna Suraksha', and a microfinance model from Argentina were declared the best, the release added. 

Govt to promote steps for energy conservation

The Ministry of Power has launched a report on 'Empanelment of Energy Service Companies (ESCOs)', which aims to promote large-scale implementation of energy conservation and energy efficiency measures in existing facilitates through the ESCO route.

While releasing the report, Power Secretary Anil Razdan informed that the electricity consumption in the commercial sector accounts for nearly 8 per cent of the total consumption in the country and is still increasing at more than 11 per cent per year. He added that this rapid growth is largely on account of the growth of the services sector and the increasing use of energy intensive appliances and technologies.

As regards the efficiency in energy consumption, Razdan stated that Bureau of Energy Efficiency has taken up the task of institutionalising energy efficiency services and promoting energy efficiency delivery mechanism through the development of a platform for ESCOs. 

India-Russia Sign Nuclear deal

India and Russia on Friday strengthened their ties further by inking 10 agreements, including a pact on civil nuclear cooperation and decided to intensify their cooperation in combating terrorism.

The agreements signed in the presence of Prime Minister Manmohan Singh and Russian President Dmitry Medvedev were in diverse areas ranging from space and defence to finance, human space programme and tourism. The new Russian President is accompanied by a host of officials and businessmen from various state-run and private agencies and companies.

Describing the agreement on civil nuclear cooperation as a “new milestone” in bilateral relations, Singh told a joint press conference with Russian President who is on a three-day visit, here, “The signing of the agreement on civil nuclear cooperation with Russia marks a new milestone in the history of our cooperation with Russia in the field of nuclear energy.”

Under the agreement, Russia will build four additional atomic reactors in the Kudankulam nuclear plant in Tamil Nadu. Russia agreed in January 2007 to help India in the construction of four energy blocks at the atomic plant in Kudankulam and nuclear power plants at new sites in India.

Separately, OAO Tvel, the Russian nuclear-fuel monopoly, agreed to deliver fuel worth $700 million to other Indian power stations.

Singh, after signing a joint declaration with Medvedev, said both the countries have taken “yet another step forward” through joint action in human space flight programme.

Russia’s space agency signed a new document with ISRO on cooperation in space exploration, which includes plans to send two Indian astronauts to space on board a Russian Soyuz spacecraft in 2013.

Observing that both countries have decided to increase the trade volume to $10 billion by 2010, Singh said they discussed the possibilities of greater cooperation between Indian and Russian companies, both in upstream and down stream sectors.

The two leaders also discussed military cooperation, including technology transfer, T-90 tanks and “issues concerning creating and selling or leasing nuclear powered submarines.”

The two countries signed accords on the sale of 80 MI-17V-5 helicopters to India and cooperation in areas including space exploration, financial markets and tourism.

According to Rosboronexport officials, the helicopter deal is worth more than $1 billion.

The Russian leader expressed hope that the arms agreement would be extended for the next 10 years. “Our prime task is to move from buy-sell to joint production and development” in missile and aircraft development, he said.

“Some issues remain, but there are not many of them,” Medvedev said. “We have agreed that we will keep these issues under joint control and we’ll fully cooperate with each other.”

Russia and India have seen a growth in bilateral trade this year, which increased in the first nine months of 2008 by 41.6% to $3.8 billion dollars year-on-year.

The two countries plan to increase trade to $10 billion by 2010 from this year’s expected level of $7 billion, and diversify economic cooperation in the future.

Both the countries, partners in the BRIC nations, which also include China and Brazil, are looking to boost trade to $10 billion by 2010. The visiting leader, last month in Sao Paulo said that the BRIC countries should play a greater role in shaping up the new global financial architecture.

Also, Russian companies plan to enter into the exploration and extraction of natural resources with Indian partners, he said. The two sides are keen to develop relations in areas such as metals, machine building, pharmaceuticals, space, biotechnology and information technology.

Russia’s Statistics Service earlier said accumulated Indian investment in Russia totaled $821 million, including $718 million of foreign direct investment. Russia invested $18 million in India in the first half of 2008.

Both countries agreed that in the wake of Mumbai terror attacks efforts should be intensified against supporters and perpetrators of terrorism.

India-Russia Sign Nuclear deal

India and Russia on Friday strengthened their ties further by inking 10 agreements, including a pact on civil nuclear cooperation and decided to intensify their cooperation in combating terrorism.

The agreements signed in the presence of Prime Minister Manmohan Singh and Russian President Dmitry Medvedev were in diverse areas ranging from space and defence to finance, human space programme and tourism. The new Russian President is accompanied by a host of officials and businessmen from various state-run and private agencies and companies.[...Read More]

Govt issues guidelines for publishing Indian edition of foreign news magazines

 The government today issued guidelines for publication of local editions of foreign magazines by Indian publishers in the news and current affairs arena. A decision to ease restrictions on inclusion of local content and advertisement was cleared by the Cabinet in September this year.

These guidelines are for the publication of Indian editions of foreign news magazines by Indian entities with or without any foreign investment, an official statement said.

Publishers of such editions will be eligible for 26 per cent foreign investment. Also, such magazines would be allowed to add local content and advertisements.

“The ceiling of total Foreign Direct Investment (FDI), which includes investments by non-resident Indians, Persons of Indian Origin (PIOs) and portfolio investments by recognised Foreign Institutional Investors (FIIs), is up to 26 per cent, according to the provisions of the FDI guidelines issued by the Ministry of Information and Broadcasting (I&B) from time to time,” the statement said.

This move is aimed at giving a boost to the magazine industry and the readers access to foreign news magazines at much lower prices.

Several Indian publishers have been looking at launching the local editions of foreign magazines for a long time.

Currently, the India Today group distributes the international edition of ‘Fortune’ magazine, while the Anand Bazar Patrika (ABP), the publisher of the ‘The Telegraph’ newspaper, is going to launch the Indian edition of Fortune magazine. Another international news magazine, ‘Forbes’, has already announced the Indian edition in a venture with the Network 18 group. “Several other foreign news magazines like ‘Newsweek’ and ‘Business Week’ have shown interest in the past to start a local edition. They will now be encouraged to launch these publications soon,” an industry source said.

The broad parameters for granting such permission say that the publisher or owner of the foreign magazine (of which the Indian edition is proposed to be published) should have sound credentials. Only those publishers who are registered as an Indian company with the Registrar of Companies under the provisions of the Indian Companies Act, 1956, will be eligible for the permission.

“The Indian companies would be allowed to enter into financial arrangements (such as royalty payment arrangements) with the owners of the foreign magazines subject to the rules and regulations. At least three-fourth of the directors on the Board of Directors of the applicant Indian company and all key executives and editorial staff should be resident Indians...,” the guidelines said.

It further said that the proposed publication should have been published continuously for a period of at least 5 years with a circulation of at least 10,000 paid copies in the last financial year in the country of its origin.

“The period of continuous publication and circulation must be certified by the respective Governmental authority of the country, and if there is no such Governmental authority regulating such matters, the certificate should be from respected and recognized agencies engaged in the business of certification,” it said.

According to the procedure for applying, 11 copies of the prescribed application form, duly filled in, along with the requisite documents will have to be submitted to the Ministry of Information and Broadcasting along with an application fee of Rs 20,000 that will have to be deposited through a demand draft. “All new applications for publication of Indian editions of foreign magazines dealing in news and current affairs sector, shall be processed and decided in the I&B ministry on the basis of inter-ministerial consultation with the other ministries like Home Affairs, External Affairs, Department of Industrial Policy and Promotion, and Ministry of Corporate Affairs as may be required,” the guidelines said. 

ISRO to expand capacity to Meet DTH demand

 Bangalore: With the country’s top direct-to-home (DTH) players, including Dish TV and Tata Sky, planning to expand their channel portfolio, Indian Space Research Organsiation (Isro) has decided to increase its satellite transponder capacity in order to provide communication service to DTH players.

Isro will more than double its transponder capacity in the near future, said managing director of Antrix Corporation KR Sridhar Murthy. Antrix, the commercial arm of Isro, is an authorised government agency to offer all Indian and foreign space-related services to local players.

Talking to FE on the sidelines of Word Space Biz 2008, India’s first international conference organised by Isro, Murthy said currently the Indian satellites have 211 transponders for communication purpose that include DTH service, telemedicine and tele-education. Of this, he said, 100 transponders are leased to DTH providers. “Another 300 transponders would be added in the next five years for various communication purposes, including DTH. It is to be noted that 50-60% of Antrix revenue comes from transponder service.

India’s second largest DTH provider, Tata Sky, managing director and chief executive officer Vikram Kausik told FE, “The company is in talks with satellite providers and specialists to avail the satellite service further in order to expand the company’s DTH capacity. We require a large number of transponders in order to transmit 1,000 channels and give our viewers a wide choice. We hope to achieve the target in the next 2-3 years.”

The demand for new channels is growing very sharply in India, especially the regional markets are growing very fast. In order to have wider regional presence, we need to have more channels to offer. The country has 400 channels at present. The number is likely to double in the next 3-5 years. Hence, the DTH providers should have the capacity to accommodate these channels, he added.

Currently Tata Sky, which has 3-million subscribers, has hired all 12 Ku-Band transponders on INSAT 4A. The company will make some changes to expand its DTH platform to accommodate 200 channels against the current 167 channels with its current transponder capacity, Kausik said. “We will touch the 200-channel mark in a matter of weeks,” he added.

On the other hand, the country’s largest DTH provider with 4.8 million subscribers—Zee’s Dish TV—also has huge expansion plans. It, however, is waiting for Antrix green signal for transponder rights.

Director (Corporate) of Zee Network Amitabh Kumar said the company’s DTH arm has applied to Antrix to provide 10 transponders to help implement expansion plans. He said the company, which currently owns around 11 Ku-Band transponders on NSS-6 foreign satellite, plans to expand its DTH space to 400 channels from the current level of 200 channels. The additional transponders will also serve the company’s other planned services like high-definition channels, movies-on-demand, which would require an additional investment of Rs 100 crore, he added. He said the company is confident of getting 10 more transponder by the mid 2009.

Other DTH providers, Sun Direct, Reliance Big TV and Airtel, are also in talks with Antrix for more transponders rights....  

With 81 m Net users, India gets 4th slot

INDIA has been ranked fourth among the top 10 nations in the world with 81 million Internet users. United States leads the chart with 220 million Internet users followed by China (210 million) and Japan (88.1 m). Brazil comes next to India with 53.1 million users, UK 40.2 million, Germany 39.1 million, Republic of Korea 35.5 million, Italy 32 million and France 31.5 million.
    The Internet Governance Forum has released these statistics on the eve of its third four-day global conference that begins at the Hyderabad International Convention Centre on December 3.
    From about 70 million people (1.7% of the world population) who had access to the Internet at the end of 2007, the figure crossed 134.8 crore by 2007. Asia has the highest number of Internet users with an estimated 568.7 million people followed by the Americas with 377.9 million.
Europe ranks third in this list with 335.9 million users and Africa and Oceania close the rank with 51.8 million and 14 million users respectively, according to the IGF. India, however, does not find place among the top ten nations in terms of broadband connections where too the US stands first with 73.2 million connections.
    China has 66.4 million, Japan 28.28 million, Germany 19.6 million, UK 15.6 million, France 15.5 million, Republic of Korea 14. 7 million, Italy 10.8 million, Canada 9 million and Spain 8 million broadband connections. While there were a total of 13.5 million Internet subscribers in India, representing 1.15 per 100 people, broadband subscribers accounted for five million among them.

    However, the number of users, who have online access but do not themselves subscribe, is a whopping 81 million or 6.93 users per people. 

60% of mobile users in rural India by ’12: E&Y

 Rural India too prefers mobile phones over landlines. Of the next 250 million Indian wireless users, approximately 100 million (40%) are likely to be from rural areas, and by 2012, rural users will account for over 60% of the total telecom subscriber base, according to a report jointly released by Confederation of Indian Industries (CII) and Ernst & Young.
    As per Trai figures, subscriber additions in rural areas exceeded additions in the metros. In the first nine months of 2008, the four metros together added 10.3 million subscribers, while the rural areas added over 11.3 million. Mobile phones in rural India also grew by close to 13.72% to reach 70.83 million in the quarter-ending June 2008. This is expected to continue till 2012, according to the CII and Ernst and Young analysis. “The majority of new wireless subscribers will emerge from circle B and circle C,” said Ernst & Young telecom analyst, Prashant Singhal.
    While the overall teledensity in India is over 30%, in rural areas the figure languishes in single digits. CII predicts the number of subscriber addition in rural areas to exceed the additions in metros by 2012 with about 120 million new users expected to adopt wireless telephony in rural areas compared to about 62 million in the metros.
    With over 300 million mobile subscribers, India is the second largest market, after China, in terms of subscribers. By 2012, the total telecom subscriber base is expected to shoot up to include about 700 million subscribers, of which about 650 million will be wireless users.

60% of mobile users in rural India by ’12: E&Y

 Rural India too prefers mobile phones over landlines. Of the next 250 million Indian wireless users, approximately 100 million (40%) are likely to be from rural areas, and by 2012, rural users will account for over 60% of the total telecom subscriber base, according to a report jointly released by Confederation of Indian Industries (CII) and Ernst & Young.
    As per Trai figures, subscriber additions in rural areas exceeded additions in the metros. In the first nine months of 2008, the four metros together added 10.3 million subscribers, while the rural areas added over 11.3 million. Mobile phones in rural India also grew by close to 13.72% to reach 70.83 million in the quarter-ending June 2008. This is expected to continue till 2012, according to the CII and Ernst and Young analysis. “The majority of new wireless subscribers will emerge from circle B and circle C,” said Ernst & Young telecom analyst, Prashant Singhal.
    While the overall teledensity in India is over 30%, in rural areas the figure languishes in single digits. CII predicts the number of subscriber addition in rural areas to exceed the additions in metros by 2012 with about 120 million new users expected to adopt wireless telephony in rural areas compared to about 62 million in the metros.
    With over 300 million mobile subscribers, India is the second largest market, after China, in terms of subscribers. By 2012, the total telecom subscriber base is expected to shoot up to include about 700 million subscribers, of which about 650 million will be wireless users.

Take evidence of Pakistan links to United Nations, CPM tells Centre

With evidence of Pakistani links to the audacious Mumbai terror attacks coming to light, the CPI(M) wants the UPA Government to internationalise India's diplomatic offensive against Islamabad by taking the proof to the United Nations Security Council.

The extraordinary step, the party feels, will help mount international pressure on the Pakistani government to crackdown on terrorist elements operating from that country. Also, it is of the view that the killing of foreign nationals in India by terrorists has international implications.

In detail, the CPI(M) wants the Government to utilise the post-9/11 UNSC resolution against terrorism (1373) that puts it in black and white that all countries have obligations to take steps against terrorist activities and to deny "safe havens to those who finance, plan, support, or commit terrorist acts".

"If we have that kind of evidence against Pakistan, why should we shy away from utilising an international resolution which could help us," asks CPI(M) Politburo member Brinda Karat. Once taken the matter to the UNSC, the party says the world body can decide on the measures to be adopted to "identify and curb such terrorist activities".

The CPI(M) says the resolution adopted by the UNSC days after the September 11 terror attacks in the US can help India like any other country in its fight against terror. "It will help in putting pressure on Pakistan to give up its policy of harbouring terrorists," Karat told The Indian Express.

CPI(M) general secretary Prakash Karat also put forward this suggestion at the all-party meeting convened by the Prime Minister on Sunday, but it was not accepted due to lack of consensus.

Senior CPI(M) leaders point out that External Affairs Minister Pranab Mukherjee has already gone on record to state that elements in Pakistan are appeared to be behind the attacks while reports in the media about investigation also point in that direction.

"Investigating agencies will have to produce whatever evidence they have got so far. If they believe there is a prime facie evidence to suggest the role of elements in Pakistan in the attacks, they should make it available to the international community and corner Islamabad," a senior leader said.

Why India is a target

We're poor. We're illiterate. We're still traditional. Too many religions, too many languages, too many ethnicities. What do we have that the extremists repeatedly make us the target of their terrorism?
Those very things - poverty, illiteracy, tradition, multiple religions, ethnicities and languages. Not because they are a fertile breeding ground for radical recruits but because India is finding workable, affordable and replicable solutions which will help it overcome the same problems. Those solutions are being emulated by emerging societies across the world, giving them hope for their own futures. That is why India's unexpected rise is threatening to those forces that work in the darkness of despair. Socially, politically and economically, India sits between two extremes: the West and China. The models of the western world are too developed to be easily adapted - 50 years of aid has not been effective. China is autocratic, its top-down growth delivered by an appointed, disciplined elite to an obedient population. Neither condition is universal. India's is. "India is, in a sense, the crucible of the world," says Prableen Sabhaney of Fabindia. Under the umbrella of India, in varying stages of development, is the rest of the world - south Asia, where it is the mother culture, but also Africa, some nations of the Middle East, south and central America, central and south east Asia. These are regions rich in assets, and human capital with the potential and now the desire, to develop. They all think: If India can do it, so can they. India is showing how a developing country can transform itself - from the bottom up. Politically, it is democratic, pluralistic, inclusive. Its democracy is chaotic and imperfect, but it functions and it is moving forward. What counts is the vote, first and foremost. Accountability... that'll come later, at some point when democracy has produced enough social and economic equality. But that vote is empowering, it creates upward mobility and a huge constituency of the poor and underprivileged for democracy that gives it staying power. The executing machinery of this democracy is often faulty, but understands the constraints within which it operates. The election commission knows how to access and include people from the remotest corners of the country and overcome the boundaries of tradition - a case study that Afghanistan could use. The judiciary is overburdened and inefficient but also activist when necessary - Pakistan has seen that. The press is free and self-serving but enough times the watchdog it needs to be; the parliament is obstructionist but vital. Rather than spill blood, Indians have learned to use electoral politics and affirmative action to negotiate their way up and out of the centuries-old repressive caste system that left craters of inequality. It left India's elite, the Brahmins, excluded from the political and administrative system, so they turned to entrepreneurship from their professional degrees - mostly engineering. That's how information technology arrived in India, like the new avatar of Vishnu, bestowing upon India its transformative powers of a virtually workable existence. Sure, all developed countries have software, cellular and satellite technology. But resource-poor India used it differently. Software services were used as the engine of exports. Cellphones weren't just about communication but also about affordability. And affordable, home-built satellites which brought in western programming, transported ordinary Indians into the drawing rooms of the world and forever changed the aspirations of generations of young Indians. They all want to emulate the success of those Brahmin engineers, and education - which gives them freedom from poverty - has become their priority. Now India is known as a country whose brain power has 'ingenuity' and the unique capability of 'frugal engineering.' It also has model corporations like the Tata Group, which have a charitable trust as is majority shareholder, and understands the true meaning of 'stakeholders' and 'shareholders.' Companies like Fabindia have shown that artisanal collectives can compete with the mass production of China, and still keep India's delicate social balance intact. The economic success of a poor, democratic country is enough to threaten the terrorist way of life. But what really gives them sleepless nights is India's accessible dreams. It is possible in today's India, to go from rags to riches in one generation. There's confidence, there's education, there's increasing equality. This is fuelled by the exuberance of India's entertainment industry. Bollywood still produces mostly musical family fare but its stories have morals and are a handbook on how traditional, multi-religious and ethnic societies traverse the thorny path into the modern era without losing their identities. When terrorism strikes, Bollywood will show Muslims to always be the most loyal of friends. When traditionalists revolt against western cultural domination, Bollywood will tell the tale of a girl who lives in America and wears a short skirt, but can still fall in love with a son-of-the-soil and be a devoted wife in small town India. Television also unites this diverse India: talent from Kashmir to Meghalaya to Kerala dream of becoming the Indian Idol. The Taj and the Oberoi symbolized this India of accessible dreams. Accessible to Indians, but also to nations like India - poor, traditional societies, some re-emerging from the dark years of colonialism or misguided socialist policies or autocratic rule, looking for affordable, democratic, socially acceptable development models which will give them hope for a bright future. Exactly what the terrorists don't want.

Foreign Investment

According to the Securities and Exchange Board of India (SEBI), as many as 120 foreign institutional investors (FIIs) have registered in India since the global financial crisis broke out in September, and according to a study by Venture Intelligence, venture capital investments in India grew by 36 per cent to US$ 290 million during July-September 2008. Significantly, investments in the Indian healthcare sector have grown to US$ 450 million in the first six months of this fiscal, compared to US$ 125 million in the same period a year ago, according to a study by Feedback Ventures.

Govt looking to allow up to 49% FDI in FM radio

FDI limits in FM radio could soon be increased to 49 per cent for non-news channels and up to 26 per cent for news channels. News will also be allowed, according to Mr Anand Sharma, Minister of State, Information and Broadcasting.

“We are awaiting the comments from TRAI after which approval of the Cabinet shall be sought,” said Mr Sharma. “We are in the process of finalisation of Phase-III of this policy which shall expand FM radio services to 275 cities across the country. This policy will follow an even more liberal dispensation than before and would promote healthy competition to benefit the masses,” he added.

Special incentives are being considered for the expansion of FM radio coverage in the North Eastern states, Jammu and Kashmir and island territories. The Minister was briefing media at a conference in the Capital. Policy initiatives for Mobile TV and Headend in the Sky were also being worked on.

Pay TV homes are projected to increase from 74 million in 2007 to 115 million in 2012, and the Government reiterated its commitment to digitisation of television. Convergence of information, communication and entertainment (ICE), or the “ICE revolution”, was posing an unprecedented regulatory challenge for the Government said the Minister. The Government is also looking at reforms in the cable laws and the digitalisation of cable services.

Content quality

Of special concern, however, was the quality of content in electronic media.

“The Supreme Court has made serious observations on this issue and we feel that there is a strong and urgent need of content regulation of some kind. We are seized of this matter and are trying to find a solution which strikes a balance between freedom of creative expression and the need of content regulation,” said Mr Sharma.

Commenting on the opening up of print media with permission for Indian edition of foreign news magazines, Mr Sharma said that the Government “mindful of the sensitivities involved in the news segment” has not allowed local content to be added by foreign publications.

According to the Ministry, the entertainment and media industry witnessed a growth of 17 per cent in the last financial, the television industry is expected to grow annually at around 22 per cent and radio industry at 200 per cent over the next 5 years. 

FIIs direct India entry!!

The Securities and Exchange Board of India (Sebi) is working on a policy to allow certain categories of foreign investors to invest in Indian securities markets through the automatic route, without having to register themselves with the regulator, as is the current norm.

The proposed automatic approval will be subject to KYC (know-your customer) requirements being complied by brokers and custodians, through whom foreign investors carry out their transactions.

FIIs such as pension funds, endowment funds, university funds, insurance companies, banks and mutual funds are likely to be among the foreign institutional investors that may be allowed to invest directly in the Indian market, officials familiar with the development told ET.

They said the capital market regulator was deliberating whether to do away with the registration process for any entity. However, the view taken by RBI on this will be crucial in formulating the policy. In the past, the central bank had expressed reservations relating to KYC norms given the threat of money laundering and terror financing.

Currently, even though Sebi does the FII registration, it is the custodians of these investors who ensure that KYC norms are being complied with, and also maintain their own records of transactions.

Sebi has already started discussions with market intermediaries to understand how the FII registration process works in other emerging markets such as South Korea, Taiwan and Singapore. In some of the markets such as South Korea and Taiwan, foreign investors have to just fill an application form and can start trading within two days.

Financial sector regulators are also looking at the issue of distinction between foreign direct investment (FDI) and foreign institutional investment. Their view is that portfolio investment should not be considered for FDI limit since portfolio investors just have trading interests.

Another important move considered by policy makers is to allow any overseas entities, including NRIs (non-resident Indians) and OCBs to invest in the local stock markets, provided they identify themselves under the KYC norms.

“There should be no discrimination between non-resident Indians and other investors...since NRIS are already bringing in so much of foreign exchange remittances into the country,” an official associated with the exercise said.

Currently, NRIs are allowed to invest through different category or schemes such as the Portfolio Investment Schemes — they can pick up to 5% in one company. They can also invest through a broad-based fund, which has at least 20 investors with no investor holding more than 10%.

“Once the restrictions on NRIs are removed, it will enhance the inflow of investments in India substantially,” said a senior official with a law firm involved in the FII registration process.

Following the stock market scam of 2001, investment by NRIs has become more difficult, since overseas corporate bodies or OCBs were banned. The regulator is likely to put out the consultative policy paper for public comments shortly.

Meanwhile, the Sebi board, which will be meeting this week, is likely to discuss the future of regional stock exchanges.

In the recent past, Sebi had appointed a committee to study the future of regional stock exchanges — post-demutualisation under the leadership of G Anantharaman, former Sebi whole-time member. 

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Oil & Gas Comes to focus

According to Ernst & Young, the value of oil and gas companies has decreased due to the ongoing economic downturn, making it a good time for Indian companies to buy global assets. Significantly, ESSAR Exploration & Production (EEPL) has become the first Indian oil company to enter Australia by winning two offshore petroleum exploration blocks.

While Indian companies are acquiring E&P assets abroad, sovereign wealth funds from China, the Middle East and Singapore are seeking to acquire E&P assets in India, which is expected to bring in foreign investments worth US$ 10 billion by 2010. And the government recently awarded 44 oil and gas blocks, which is expected to attract investments worth US$ 1.5 billion

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