Post on 08-Sep-2014
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Sustaining India’s Growth Story – Anil Kumar Yadav & Badrish Agarwal
July 1991 Manmohan Singh presented the budget that would change India
Devalued the rupee Abolished quotas & licenses
Opened industries to foreign capital
India’s Economy grew by 8% yoy & quadrupled in size
from 400 Bn USD to 1.6 Trillion USD
No Power on Earth can stop an idea whose
time has come
20 Years hence 2011
50 Billionaires 500 Million Poor
$ 2 Billion Home42% of world’s hungry children
Food Inflation 12.21% as of yesterday
Is this time to give India a push ?
1 32
Capital
Land
Labor
Focus on Inputs
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Capital
Land
Labor
Focus on Inputs
Financial Development Index 2010
India 37 51 52 45 41 13 24 49
China 22 35 38 17 8 4 30 26
USA 1 14 17 39 27 1 1 5
Japan 9 16 20 33 5 7 5 28
CountryInstitutional Env
Biz EnvFin stabilityBanking Fin ServicesNon Banking Fin ServicesFin marketsFin accessOverall
India’s bond market needs to bulk up
Allow banks to guarantee bonds
Lift cap on foreign insurance & pension companies
Can India’s 1 Trillion USD infrastructure project succeed without a robust corporate debt market
Better harness the potential of institutional investors
Remove few constraints on institutional investors
1 32
Capital
Land
Labor
Focus on Inputs
Farmers protest against land acquisition in Chhattisgarh, 78 heldThe Times of India, Jan 19, 2011
78 Farmers protesting against forcible acquisition of their land for a 3600 mw power plant were arrested and several others lathi charged in Chhattisgarh's Janjgir Champa district.
India: Uttar Pradesh farmers protest spreadsTodays’ News; May 9th, 2011
A protest by thousands of farmers against alleged forced acquisition of land has spread to parts of the northern Indian state of Uttar Pradesh.
Power plants protest shows industry - farmer riftPublished on Fri, Jan 21, 2011 at 17:34 | Source : Reuters
Hundreds of stone-hurling farmers protested in Uttar Pradesh against the takeover of their land for two proposed power plants on Friday, police said, spotlighting challenges the country faces in building infrastructure.
Land – Growing concerns
124 Govt initiated infra projects behind schedule from 3 to 86 months
100
ROAD
Land Acquisition Model - Typical
50 50
100
450 450
ROAD
Everyone shifts outwards by 50
Land Acquisition Model – Might help
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Capital
Land
Labor
Focus on Inputs
Where do we stand ??Unemployment %
40 million Unemployed PeopleIn next 15 years around
165-195 M people will enter the workforce
2005 2006 2007 2008 2009 2010 201102468
1012
But…………Gap of 12 M people in the grey and blue collared segment alone.
180 Mn
60 Mn
Scenario in next 15 year (Million)
DemandUnMet Demand
Why is that?
5%
95%
Indian WorkForce
EmployableNon-em-ployable
80%
20%
Developed Countries WorkForce
Why is that?
• Of every 100 children who enroll, 70 dropout by the time they reach out secondary level
Why is that?
India Developed Economies0%
10%
20%
30%
40%
50%
60%
Graduates Attending Vocational Training
Graduates Attending Vocational Training
5-10 %
What needs to be done?
Rationalize 200 labor laws
Allow contract labor in
organized sector
Campaign to Address
Cultural Issues
Vocational training is outside the regulatory framework so profit making business models can easily be worked out.
NSDC has identified 26 companies with which it will partner to impart vocational skills.
• Delhi based Empower Pragati Vocational• Pratham Education Foundation• IL&FS skill development corporation• Manipal’s group Indiaskills• Teamlease’s IIJT• Educomp & Mumbai based Rustomjee group• Nodia based GrasAcademy
Focus on Vocation Training
Case study – Empower Pragati Vocational
• The company will expand through the franchise model and will train 2 Mn people over next 10 years
• Assured outlay of 18.9 Cr of which 18.5 Cr is debt• NSDC has picked 10 % equity in the company and has the
option of picking up another 16.6% after 3 years @ 75% of the market value.
Time to give India a push
Let the whole WORLD hear it loud & clear INDIA is wide awake