IndUS Business Journal

With 95 mobile companies setting up plants, India becomes manufacturing hub for mobile devices

Sep 24, 2017 0

New Delhi–Information Technology (IT) Minister Ravi Shankar Prasad on Sunday said 95 mobile manufacturing companies have set up their plants in the country.

“Today 95 mobile manufacturing factories have come up in India and India is becoming a big hub of electronics and mobile manufacturing. Of these, 32 units have come up in Noida and Greater Noida,” Prasad said at the Capital Foundation Annual Lecture here.

“Every day we are adding 3-4 start-ups. They are IITians, they left their jobs in America and have come back to India,” he said.

“In Silicon Valley (US), 51 per cent of new inventions are IT-based and 14 per cent of those are created by Indian minds there. That is how India is emerging,” he added.

Ravi Shankar Prasad

The minister also said the government plans to make 6 crore families in the country digital-literate as part of the Digital India plan.

Prasad, who is also Law Minister, also lauded the Supreme Court for leveraging digital technology in expediting judicial processes.

“We have created digital data grid. Today we have got about six crore orders of judgements on the digital data grid and about 4 crore of pending cases are also there. At a click of the button, you can monitor it, how many of them have been disposed,” he said. (IANS)

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Tax raids on coffee chain find Rs 650 crore concealed income

Sep 24, 2017 0

Bengaluru–The Income Tax Department raids on Cafe Coffee Day (CCD) retail chain since Thursday found Rs 650 crore concealed income from the documents seized, said an official on Sunday.

“Documents seized from the search operations at 25 places of Cafe Coffee Day and its group companies in Karnataka, Mumbai and Chennai have revealed concealed income of over Rs 650 crore,” a senior tax official told IANS here.

The search and seize operations, which began on September 21, concluded on Sunday evening in the offices of the group involved in coffee, tourism, IT and other areas.

“The searches concluded with the group’s officials admitting to concealed income exceeding Rs 650 crore and the detection of undisclosed income, which is expected to be a much higher figure,” said another tax official in an e-mail to IANS.

The offices and residence of CCD’s founder owner V.G. Siddhartha and its other officials in Bengaluru, Chikkamagaluru, Hassan and Mysuru across Karnataka were also searched during the last four days. Siddhartha is the elder son-in-law of former External Affairs Minister S.M. Krishna, who was also Chief Minister from 1999 to 2004 but earlier this year left the Congress to join the Bharatiya Janata Party.

“There are a number of other issues, including violations of other statutes on which there is no disclosure but relevant evidence has been found. These will be pursued effectively as part of our investigation,” added the official in the e-mail.

The raids were conducted under the directions and supervision of the Income Tax Department’s Investigation Cell Director-General B.R. Balakrishnan.

The corporate office of the Amalgamated Bean Coffee (ABC) Trading Company, which runs the CCD’s retail outlets across the country, its branch offices at Chikkamagaluru, Mudigere and Sakeleshpur in Karnatakas’ Malnad region were also searched during the exercise.

“Though we have found and seized a number of documents related to properties, business transactions and other dealings, they are subject to scrutiny for violations, if any,” added the official. (IANS)

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Tez to take India closer to digital transformation: Pichai

Sep 19, 2017 0

New Delhi– A day after Google launched its new digital payment app “Tez” in India, the company’s Indian-born CEO Sundar Pichai on Tuesday tweeted it will help India move closer to digital transformation.

“We hope that the launch of @TezByGoogle will help take India one step closer to your vision of @_DigitalIndia,” Pichai tweeted.

Finance Minister Arun Jaitley who launched the app here had said the idea of “Tez” was discussed by Pichai in January, just after demonetisation.

“Google saw a great potential in Indian economy and businesses,” Jaitley said, adding that Google’s new digital payments app over the next few months was likely to make major advances in digital transaction volumes.

Sundar Pichai

Built on the Indian government-supported Unified Payments Interface (UPI), Tez allows users, free of charge, to make small or big payments straight from their bank accounts.

The app was built for India, working on the vast majority of the country’s smartphones and available in English and seven Indian languages (Hindi, Bengali, Gujarati, Kannada, Marathi, Tamil and Telugu).

The app works in partnership with four Banks — Axis Bank, HDFC Bank, ICICI Bank and State Bank of India — to facilitate the processing of payments across over 50 UPI-enabled banks.

According to D.D. Mishra, Research Director, Gartner, Tez provides promising features which are in-line with the requirements.

“It is too early to say whether it can be a game changer as evolution in this business is going to continue, but yes it has the capabilities to bring some disruption as of now,” Mishra said in a statement.

Moreover, Google’s information about an individual’s preferences can play a good role in enabling business to know their preferences and provide offers with interesting options.

“The mobile wallet industry too, is evolving and we are at an interesting stage in this competition. Eventually, UPI payments will have an upper hand if it continues to remain free and provide better security, convenience and add more Value Added Services,” Mishra informed. (IANS)

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Sriram Krishnan Joins Twitter as Senior Director

Sep 19, 2017 0

San Francisco– Micro-blogging website Twitter has hired Indian-born Sriram Krishnan, a former top executive from Facebook and Snap, as its Senior Director of Product.

“I’m going to be joining Twitter and become a part of #theflock to work with the fantastic product team there,” Krishnan tweeted.

A well-known product executive around Silicon Valley, Krishnan has primarily focused on ad technology.

“So so so so so so excited to have you Sriram! Welcome home,” tweeted Twitter CEO Jack Dorsey late on Monday.

Sriram Krishnan

“At Facebook, he helped build the company’s ad network, Audience Network; at Snap, he helped build out the company’s ads API,” Recode reported on Tuesday.

Starting October 2, he will be responsible for core features inside the main app, including timeline, direct messaging and search.

Krishnan will report to Keith Coleman, Twitter’s Vice President of Product.

Krishnan left Facebook in February 2016 to help lead advertising efforts at Snapchat’s parent company Snap. He quit Snap in February.

At Facebook, he led “Facebook Audience Network” to take on Google. (IANS)

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Exporters’ woes under GST: Working capital stuck as refunds not available

Sep 10, 2017 0

By Meghna Mittal

New Delhi–Exporters are having a tough time since the roll-out of the new indirect tax regime as the online facility to claim refunds is not yet available, with many even postponing shipments as they grapple with low funds, stakeholders and experts have said.

The worries are greater for small and medium exporters who have a turnover of less than Rs 20 crore as their cost of working capital has significantly risen with refunds not coming so far under the Goods and Services Tax (GST) regime.

“We estimate an additional working capital of Rs 1.5 to Rs 2 crore for us. At present, refunds can’t be claimed as Goods and Services Tax Network (GSTN) system is not yet operational. We have to pay GST on procurement and also keep control on all vendors to ensure that they pay GST,” Vilas Phule, CFO, Magna Steyr India, which exports engineering services in the automobile sector, told IANS.

The company with a monthly turnover of Rs 6 crore to Rs 8 crore, exports services worth Rs 4 crore to Rs 6 crore every month.

Certainly, this was putting exporters in a lot of working capital pressure, he added.

Jigar Doshi, Partner, SKP Business Consulting, said: “At present, exporters are unable to file refund claims online as no facility/utility is available at GSTN website and is unknown as to when it will be made available. Now, working capital blockage is proving to be big hurdle particularly for small exporters, who do not have deep pockets.”

GST expert Pritam Mahure said, “In GST regime, exporters are facing challenges as the upfront exemption is not available and given this working capital of exporters is getting blocked. I hope that the government forms a high level committee to address their challenges or else the working capital blockage can derail the struggling exports scenario in India.”

In the previous indirect tax regime, exporters enjoyed upfront tax exemption on goods to be exported. But under GST, exporters are procuring goods and services on payment of GST. This credit of GST, which is available with exporters is supposed to be claimed as refund.

Under GST, there is also Integrated GST applicable on the export turnover, for which there are two methods available — one to export without payment of GST (under cover of Letter of Undertaking or Bond) and second with payment of IGST and then claim refund of it.

“In our case, we have 80 per cent export of services. Hence, GST paid on procurement of services which needs to be claimed as refunds. If exemptions, similar to the one given under previous indirect tax regime, are granted then the funds blockage can be optimised along with reduction in unnecessary administrative work for paying GST and then claiming refunds,” Phule said.

The former GSTN Chairman Navin Kumar, who retired recently, said, “For exporters, it is not yet available. For exporters there is going to be a separate form where he can claim refund of IGST. Currently the online facility is not active on GST portal.”

Amar Kulkarni, CFO, Hoerbiger India, which exports gas compressor valves for the petroleum industry, said, “Given the working capital pressure, many exporters are postponing the exports and are struggling for funds. This entire process of claiming refund by exporter can be eased through upfront exemption.”

The exporter is required to capture details of monthly export for GST return and this is a tedious work, he said.

Another exporter Samir Oke, who exports thermocol for refrigerators admitted that his company was facing a problem of blockage of working capital with GST.

“Even, in case of procurement from unregistered vendors, the company is required to pay GST which further leads to increase in working capital requirement,” Oke, CFO, K K Nag Pvt Ltd, told IANS.

“We faced numerous challenges in obtaining a Letter of Undertaking for exporting goods without IGST. The said procedure was expected to be online but practically we had to visit and follow up with the authorities for the same,” he added.

Doshi said, “Prior to GST regime, there was no requirement to obtain Letter of Undertaking for exporting services, which is mandatory in GST regime and given this service exporters face numerous challenges. The government should identify key challenges faced by exporters and address the same immediately.”

Further, the refund of GST can be claimed only if the vendors pay GST and this is required to be tracked by the company, which is leading to more hassles for the exporters.

“There are various requirement as far as input tax credit is concerned. It is very difficult to communicate with numerous vendors and ensure that they are paying GST. The company is required to ensure that vendors are paying and filing returns in case of a registered vendor. In case of unregistered vendor, the company not only has pay the GST but is also required to raise the tax invoice and payment voucher, which is a tedious and time consuming process,” Oke said.

Hoerbiger India said, “We are being held responsible for compliance by vendor, which is unreasonable as SME exporters don’t have manpower to ensure all these.”

To add to the woes, recurring breakdowns of the GSTN system are making things worse for the exporters.

“GSTN system is not ready and we are facing numerous errors in the system during filing of GST returns,” Magna Steyr India said.

Hoerbiger India said, “Exporters are investing a lot of time during return filing process as the GSTN system is not robust. If such problems continue then the company will have to focus only on returns on that export.”

There is no surety on whether the tools or website will work on a particular day as due to traffic surge GSTN system was down multiple times, thus exporters are facing challenges in filing of GST returns, Oke protested.

Anita Rastogi, Partner, PwC – GST and Indirect Tax, said, ” The largest issue being faced by an exporter is that of additional working capital requirement. There are teething problems being faced by exporters on the procedural side. It is important that the interests of exporters are safeguarded and this should be taken on priority by the government.” (IANS)

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From Chandigarh to among richest in Hong Kong: Harry S. Banga

Sep 10, 2017 0

By Jaideep Sarin

Hong Kong– He grew up in Chandigarh and never thought he would be a billionaire and one of the richest people in Hong Kong. But Harry S. Banga has done that successfully in the fields of commodities, ship management and asset management.

With a net worth of $1.02 billion, Harindarpal Singh Banga, as the chairman of the fairly young Caravel Group, not only figures among the list of Top-50 richest people (Forbes Magazine) in Hong Kong but is known as the tycoon who has staged a comeback in the commodities sector in a big way.

“It’s been a great journey. (I am) So proud of achieving what we have done. Obviously, there were a lot of ups and downs. Never realised on leaving Chandigarh that I will be where I am today. By the grace of god, it has been a wonderful and successful journey. One day I will write a book,” Banga told IANS during an interview in the swanky headquarters of the Caravel Group in the Central Plaza skyscraper in Hong Kong’s busy Wan Chai commercial area.

Banga, who started as a shippie, has reasons to feel proud.

He exited the Noble Group, in which he was a co-founder in 1988, just before it started crumbling on the business front. Setting up the Caravel Group in 2013 with an $800 million investment, Banga was soon back in the big league of Hong Kong billionaires early this year.

Harry S. Banga

“We have three verticals within the Caravel Group. The first one is Asset Management. It is purely investing in liquid assets in equity, fixed income and debt investment and some private equity investment. The other part is brick and mortar business in Caravel International which has got two verticals. One is Caravel Resources under which we do the commodities business. Then we have Caravel Maritime and Caravel Fleet Management Limited.
“Today we are the third largest ship management company in the world. We have 450 ships under our management, close to $20 billion dollars of assets. Total officers and crew are about 18,000 — the majority of them from India,” he explained.

With operations spread in 19 countries across most continents, Banga says that doing business with China is easier.

“Seventy per cent of our total turnover comes from China. I have been dealing with China since 1983. Dealing with officials and corporates in China, I find them very easy to develop and do business with.

“Our business mainly focuses around China, which is the main consumer of commodities today. Today, we are the largest international trading company supplying iron ore to China. Total volume is 40 million tonnes. The originating countries are India, Australia, South Africa and Brazil. Caravel Carbon does the thermal coal business. Sixty per cent of that goes into China and 40 percent to India to power plants, cement plants etc,” he said.

Though his company has offices in India, the business dealing is limited.

“While in other countries in Europe, Australia, America it is either a green light or red light — it is all very clear. Though in the last three years it is changing, in India it is permanent amber light. So, you don’t know if it is red or green. They do come with a policy in India but it takes a long time to understand that policy,” said Banga, who was honoured with the Pravasi Bharatiya Award in 2011 by the Indian government.

“Ours (India) is not easy. We have religion issues, caste issues, language issues, states have their own issues. All these things are very challenging. New Delhi takes decisions. The implementation is in districts. It is a very different world there (in the districts). In Beijing, one guy decides, everyone implements,” he said.

Banga is worried that too many young people in India are getting education and skills, but not enough jobs are available.

“In India, we have the beauty product and health product e-retail company called Nykaa. That is one of the major investments that we have,” he added.

Born in Amritsar, Banga, 66, did his schooling and bachelor of engineering in Chandigarh before moving out in the 1970s.

“I became the youngest captain at the age of 27-and-a-half. I worked with companies in London, Geneva and Hong Kong, where I arrived in 1984,” he said.

Among other things, Banga has an eye for contemporary paintings and antiques. (IANS)

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Limited access to capital, gender bias biggest challenges for Indian women entrepreneurs

Sep 7, 2017 0

Kolkata– Lack of access to capital, gender bias at work place and a weak infrastructure in capacity building for women to derive necessary skill sets are the “key challenges” in the way of women entrepreneurship in India, a US-based woman entrepreneur and investment banker said here on Thursday.

“In India despite all the pro women government schemes, the awareness of how to get access to capital is very limited. The women may manage to get the debt but the access to private equity in the form of venture funding or mid to late stage funding is minimal,” Accelerator Group LLC Managing Director Seema Chaturvedi said in a media round table organised by the US Consulate General Kolkata at the American Center here.

Seema Chaturvedi

She also stated that the women are victims of gender bias at workplace across the world and are stereotyped primarily as care givers in the household.

“It came out during the workshops that whether the woman is from New York or from Coimbatore, there were slimier experiences of significant gender bias at the work place. These experience was not related to being an entrepreneur but is more related to being a woman,” she claimed.

In the run up to the upcoming Global Entrepreneurship Summit (GES) 2017, Chaturvedi was in the city to engage with Global Links students, government officials, entrepreneurs, businessmen, start-ups, and NGOs for promoting entrepreneurship, innovation and business incubation through programmes.

Claiming that the capacity building for women skills is strongly missing in this country, she said a lot women entrepreneurs in India do not have an ability to access certain opportunities as they lack certain soft skills like pitching their ideas to the investors.

“A lot of women either do not have access or are not aware of the opportunities, Some of them do not know how to pitch. So the bottleneck is more societal,” she added. (IANS)

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India to become 5th largest consumer market by 2030

Sep 7, 2017 0

New Delhi–India will become the fifth largest consumer market in the world by 2030, a joint report said here on Thursday.

According to a Ficci-Deloitte report on the retail, fast moving consumer goods (FMCG) and e-commerce sectors in the country, the consumer retail industry is expected to reach a size of Rs 85 trillion by 2021.

“Consumer retail forms an integral part of the industry with a current estimated size of more than Rs 45 trillion,” said the report “Konnected to Consumers”.

“It is further expected to witness a CAGR of over 10 per cent in the period 2016-21 to reach a size of Rs 85 trillion by 2021,” it added.

The report said the consumer industry is one of the most dynamic and amongst the fastest growing industries in India.

Although optimism is well founded and makes India attractive to FMCG firms and retailers, challenges remain like poor basic infrastructure, a complex multi-layer regulatory and taxation regime, the report added. (IANS)

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I may have resigned if note ban was thrust: Rajan

Sep 7, 2017 0

New Delhi–Former RBI Governor Raghuram Rajan said on Thursday that he would have resigned if the demonetisation decision was thrust on him but made it clear that the government can bypass the central bank if it wants to push ahead with such a decision.

“It (demonetisation) happened in 1978. Government brought in demonetisation through an ordinance. The government can completely bypass the RBI,” he told the media ahead of the launch of his book “I do what I do – On Reform, Rhetoric and Resolve” in the capital.

Asked what he would have done if the government wanted to bring in demonetisation and whether he would have said “No, only over his dead body”, Rajan replied the government does not need the RBI’s nod and if it still wanted to go ahead with it, “then the only option is – take my resignation”.

Raghuram Ranjan

“It is not fair to answer this question unless you are in that position. Any civil servant, regulator or a central banker…to the extent they have to implement a policy they don’t believe in, basically (they) should not be sabotaging the policy because it is for the elected government to do what it wants. The only option is opting out.”

Rajan said during his tenure in the RBI, which ended in the first week of September last year, “absolutely there was no date fixed for implementing demonetisation”.

In his book, Rajan has talked of an informal verbal discussion with the government on demonetisation that was announced on November 8 last year.

Rajan said if the government wanted to implement demonetisation without disruption, then it should have all the currency it wanted to replace from day one.

Asked about his views on the impact of demonetisation on the economy, he prefaced his reply with a caveat that he would be extremely careful about what he would say because the country still did not have all the data.

But he did concede that the note ban did affect the economy and eat into investment and threw out a lot of business on the margins.

“We don’t knock the economy for a six. We don’t do that,” he said.

He said while the intent of the government in doing demonetisation was to bring a lot of people not paying taxes into the tax net, the Rs three to Rs four lakh crore extra that has come into the formal banking system would cost the RBI because interest has to be paid on that sum. While tax compliance was welcome, the short term impact of the note ban decision was it could have cost the GDP growth by 1 or 1.5 per cent.

While successive finance ministers have tried to go after tax dodgers, the government could find some way of doing it better but “avoid a shock like demonetisation”, he said.

While the unaccounted money was serving the economy, by now coming into the banking system it would involve an interest outgo of Rs 20,000–Rs 22,000 crore a year. Also the dividend payment of RBI has come down from Rs 65,000 crore by half.

The former RBI Governor said the move to link Aadhaar with bank accounts was welcome subject to concerns expressed by the Supreme Court judgement in the privacy case, which he described as “splendid”.

To questions about what was discussed between him and the government before he exited from the RBI and whether he would have liked to continue for another term, Rajan said as his tenure was nearing an end he wanted to know from the government about their plans for him as he would have to tell the University of Chicago from which he had taken leave.

He said it would be inappropriate for him to give the details of the discussion, but did acknowledge that there was no agreement between the two sides.

In fact, he said, he wanted to continue at the helm of the RBI to work on two things — banks clean up and the Monetary Policy Committee. “I was open.”

He dismissed a report by a noted columnist recently that the Modi government was open to giving a fresh term but leave considerations in the University made him hesitant. “False,” he said on the report, adding that the University would have given him leave if he had wanted. (IANS)

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Vasant Narasimhan appointed CEO of pharmaceutical giant Novartis

Sep 6, 2017 0

Basel, Switzerland – Vasant Narasimhan has been appointed CEO of pharmaceutical giant Novartis. He will replace current CEO Joseph Jimenez, who has informed the Board of Directors of his desire to step down as CEO in 2018, after eight years in position.

The Board of Directors has appointed Narasimhan, M.D., Global Head of Drug Development and Chief Medical Officer, as CEO of Novartis, effective February 1, 2018. Dr. Narasimhan is a member of the Executive Committee and joined Novartis in 2005.

Mr. Jimenez, who has been CEO since 2010, joined the company in 2007. He first led the Consumer Health Division, and then held the position of Division Head, Novartis Pharmaceuticals. Mr. Jimenez will step down as CEO, effective January 31, 2018, and will be available for advice and support at the request of the Chairman of the Board of Directors or the CEO until he retires from Novartis on August 31, 2018.

Joerg Reinhardt, Chairman of the Novartis Board of Directors, commented, “I would like to express my sincere appreciation for Joe’s achievements as CEO. During his tenure, Joe focused Novartis on leading global businesses, while divesting non-core divisions. Under his leadership the innovation pipeline was rejuvenated, and we successfully navigated the patent expirations of our two largest products. We anticipate a smooth transition as Joe built a strong leadership team and mentored his successor. Novartis will be well positioned to continue its momentum.”

Vasant Narasimhan

Mr. Jimenez said, “Both from a professional and a personal perspective, this is the right moment to hand the leadership reins of the company to Vas. Our strong pipeline and the strategic moves we have taken to focus the company have put Novartis on a strong path for the future. On the personal side, after 10 wonderful years in Switzerland, my family is ready to return to Silicon Valley and the US. I’m confident that Vas will be an excellent successor.”

Dr. Narasimhan has held numerous leadership positions across Novartis in commercial, drug development and strategy roles. Prior to his current role he served as Head of Development for Novartis Pharmaceuticals. Before joining Novartis in 2005, he worked at McKinsey & Company. He received his medical degree from Harvard Medical School in the US and obtained a master’s degree in public policy from Harvard’s John F. Kennedy School of Government. In addition, he holds a bachelor’s degree in biological sciences from the University of Chicago, also in the US. During and after his medical studies, he worked extensively on a range of health issues in developing countries. Dr. Narasimhan is an elected member of the US National Academy of Medicine. He is a US citizen born in 1976, married with 2 children, and lives in Basel, Switzerland.

Mr. Reinhardt added, “The strength of Novartis is our ability to drive science-based innovation. Vas is deeply anchored in medical science, has significant experience in managing the interfaces between Research and Development and commercial units and has strong business acumen with a track record of outstanding achievements. As a physician, he has a strong patient focus and a genuine humane perspective and care for the mission and values of Novartis. As a result, the Board of Directors is confident that Vas is the right choice to lead Novartis on our expected next growth phase, driving innovation and further strengthening our competitive position.”

Dr. Narasimhan said, “I would like to congratulate Joe and express my gratitude to Joe, Joerg, and the Board of Directors. I feel honored and humbled to be asked to lead Novartis. We will continue our legacy of bringing leading innovation to patients around the world. With our recent launches, our strong pipeline, broad capabilities, world-class leadership team, and committed people, I am very confident about our future.”

Novartis provides innovative healthcare solutions that address the evolving needs of patients and societies. Headquartered in Basel, Switzerland, Novartis offers a diversified portfolio to best meet these needs: innovative medicines, cost-saving generic and biosimilar pharmaceuticals and eye care. Novartis has leading positions globally in each of these areas. In 2016, the Group achieved net sales of USD 48.5 billion, while R&D throughout the Group amounted to approximately USD 9.0 billion. Novartis Group companies employ approximately 119,000 full-time-equivalent associates.

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