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AUTOMOBILES
SUMMARY
Seventh-largest producer in the world with an average annual production of 17.5 Million vehicles.
4th largest automotive market by volume, by 2015.
4 large auto manufacturing hubs across the country.
7% of the country’s GDP by volume.
6 Million-plus vehicles to be sold annually, by 2020.
REASONS TO INVEST
By 2015, India is expected to be the fourth largest automotive market by volume in the world.
Over the next 20 years, India will be a part of the big global automotive triumvirate.
Tractor sales in the country are expected to grow at CAGR of 8-9% in the next five years, upping India’s market potential for international brands.
Two-wheeler production has grown from 8.5 Million units annually to 15.9 Million units in the last seven years. Significant opportunities exist in rural markets.
India’s car market has the potential to grow to 6+ Millions units annually by 2020.
The emergence of large automotive clusters in the country: Delhi-Gurgaon-Faridabad in the north, Mumbai-Pune-Nashik- Aurangabad in the west, Chennai-Bengaluru-Hosur in the south and Jamshedpur-Kolkata in the east.
Global car majors have been ramping up investments in India to cater to growing domestic demand. These manufacturers plan to leverage India’s competitive advantage to set up export-oriented production hubs.
An R&D hub: strong support from the government in the setting up of NATRiP centres. Private players such as Hyundai, Suzuki, GM are keen to set up an R&D base in India.
Tata Nano is a sterling example of Indian frugal engineering and is being positioned as a mobilizer of the young generation.
Electric cars are likely to be a sizeable market segment in the coming decade.
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CONSTRUCTION
SUMMARY USD 1,000 Billion investments for infrastructure sector projected in 12th five year plan (2012-17).
USD 650 Billion investments in urban infrastructure estimated over next 20 years.
100% FDI permitted through the automatic route for townships, cities.
10% of India’s GDP is based on construction activity.
REASONS TO INVEST
An investment of USD 1,000 Billion has been projected for the infrastructure sector until 2017, 40% of which is to be funded by the private sector. 45% of infrastructure investment will be funneled into construction activity and 20% set to modernise the construction industry.
The Indian government has undertaken a number of measures to ease access to funding for the sector.
Construction activities contribute more than 10% of India’s GDP.
The construction industry in India has seen sustained demand from the industrial and real estate sector.
An estimated USD 650 Billion will be required for urban infrastructure over the next 20 years.
Housing for seniors has seen increased interest levels from corporates, the hospitality and healthcare industries over the last few years.
DEFENCE MANUFACTURING
SUMMARY
3rd largest armed forces in the world.
40% of budget spent on capital acquisitions.
60% of requirements met by imports.
INR 250 Billion to be invested in 7-8 years.
REASONS TO INVEST
India’s current requirements on defence are catered largely by imports. The opening of the strategic defence sector for private sector participation will help foreign original equipment manufacturers to enter into strategic partnerships with Indian companies and leverage the domestic markets and also aim at global business. Besides helping build domestic capabilities, this will bolster exports in the long term.
Opportunities to avail defence offset obligations to the tune of approximately INR 250 Billion during the next 7-8 years.
The offset policy (which stipulates the mandatory offset requirement of a minimum 30% for procurement of defence equipment in excess of INR 3 Billion) introduced in the capital purchase agreements with foreign defence players would ensure that an eco-system of suppliers is built domestically.
The government policy of promoting self-reliance, indigenization, technology upgradation and achieving economies of scale and developing capabilities for exports in the defence sector.
The country’s extensive modernization plans, an increased focus on homeland security and India’s growing attractiveness as a defence sourcing hub.
High government allocation for defence expenditure.
ELECTRICAL
MACHINERYSUMMARY
10.5% rate of market expansion between 2007-12.
USD 4.9 Billion of exports in 2013-14.
14.8% yearly increase in exports in the last 8 years.
USD 24 Billion-sized industry in 2012-13.
REASONS TO INVEST
Market-oriented reforms, such as the target of ‘Power for All’ and plans to add 88.5 GW of capacity by 2017 and 93 GW by 2022.
Incentives for capacity addition in power generation will increase the demand for electrical machinery.
Indian manufacturers are becoming more competitive with respect to their product designs, manufacturing and testing facilities.
A large pool of human resources and advancements in technologies.
Increasing scope for direct exports to neighbouring countries.
Investments in research and development in the electrical machinery industry are amongst the largest in India’s corporate sector.
FOOD
PROCESSING
SUMMARY
89.9 Million Hectares of net irrigated area.
127 agro-climactic zones.
42 mega food parks being set up with an allocated investment of INR 98 Billion.
REASONS TO INVEST
A rich agriculture resource base – India was ranked No. 1 in the world in 2012 in the production of bananas, mangoes, papayas, chickpea, ginger, okra, whole buffalo, goat milk and buffalo meat.
India ranks second in the world in the production of sugarcane, rice, potatoes, wheat, garlic, groundnut (with shells), dry onion, green pea, pumpkin, gourds, cauliflower, tea, tomatoes, lentils, wheat and cow milk.
The country’s gross cropped area amounts to199 Million hectares, with a cropping intensity of 140%. The net irrigated area is 89.9 Million hectares.
A total of 127 agro-climatic zones have been identified in India.
Strategic geographic location and proximity to food-importing nations makes India favourable for the export of processed foods.
An extensive network of food processing training, academic and research institutes spans the country.
42 mega food parks are being set up in public-private partnership at an investment of INR 98 Billion rupees. The parks have around 1200 developed plots with basic infrastructure enabled that entrepreneurs can lease for the setting up of food processing and ancillary units.
The cost of skilled manpower is relatively low as compared to other countries.
Attractive fiscal incentives have been instated by central and state governments and these include capital subsidies, tax rebates, depreciation benefits, as well as reduced custom and excise duties for processed food and machinery.
The major global players in the food domain are already present in India.
121 cold chain projects are being set up to develop supply chain infrastructure.
IT AND BPM
SUMMARYUSD 118 Billion – expected 2014 revenues.
USD 200 Billion in savings for companies in the last five years.
600 offshore development centres for 78 countries.
USD 225 Billion industry by 2020.
REASONS TO INVEST
The IT-BPM sector constitutes 8.1% of the country’s GDP and contributes significantly to public welfare.
India’s IT industry amounts to 7% of the global ma
rket, largely due to exports.
60% of firms use India for testing services.
Rapidly growing urban infrastructure has fostered several IT centres in the country.
The Indian IT industry has saved clients USD 200 Billion in the past five years
LEATHER
SUMMARYUSD 11 Billion industry.
USD 6 Billion worth of exports in 2013-14.
10% of the world’s leather production.
24% growth projected in the next five years.
55% of workforce below 35.
REASONS TO INVEST
The total production of the Indian leather industry stands at USD 11 Billion with great potential for exports and a huge domestic market.
Exports have grown from USD 1.42 Billion in 1990-91 to an all-time high of USD 6 Billion in 2013-14.
Exports are projected to grow at 24% per annum over the next five years.
The domestic market is expected to double in the next five years.
Comparative advantages in cost of production and labour costs.
MEDIA AND
ENTERTAINMENT
SUMMARY
INR 220 Billion film industry by 2018.
INR 918 Billion in 2013 revenues.
3rd largest TV market in the world.
161 Million television households in 2013.
INR 40 Million animation industry.
800 TV channels.
REASONS TO INVEST
Total market size of the Indian entertainment industry stood at INR 918 Billion in 2013, growing by 11.8% over 2012.
The industry is expected to register a CAGR of 14.2%, reaching INR 1785.8 Billion in 2018.
The size of the television industry in India was estimated at INR 417 Billion in 2013, with a projected CAGR of 16% between 2013-18, amounting to an INR 1785.8 Billion industry in 2018.
India is the world’s third largest TV market, after China and the USA, with 161 Million TV households.
India has a large broadcasting and distribution sector, comprising approximately 796 satellite TV channels, 6000 multi-system operators, around 60,000 local cable operators, 7 DTH operators and 4 IPTV service providers.
OIL AND GAS
SUMMARY
96 Trillion Cubic Feet of estimated shale gas reserves.
47 Trillion Cubic Feet of proven natural gas reserves.
800 MMT of proven oil reserves.
4th largest consumer of crude oil and petroleum products in the world.
2nd largest refiner in Asia.
REASONS TO INVEST
Policies such as the New Exploration Licensing Policy and the Coal Bed Methane Policy have been put in place to encourage investments across the industry value chain. Thirty-four blocks were put up for bidding in the ninth round of the N.E.L.P.
Demand for primary energy in India is to increase threefold by 2035 to 1,516 Million Tonnes of Oil Equivalent from 563 Million Tonnes of Oil Equivalent in 2012.
Several industries are increasing consumption of natural gas in operations.
Several domestic companies such as the Oil and Natural Gas Corporation, Reliance Industries Limited and Gujarat State Petroleum have reportedly found natural gas in deep waters.
As part of pricing reforms for the natural gas sector in 2013, the government approved a new pricing scheme to further align domestic prices with international market prices and to raise investment for the sector.
RAILWAYS
SUMMARY
4th largest rail freight carrier in the world.
USD 1,000 Billion worth of projects to be awarded through Public Private Partnership.
1.3 Million-Strong workforce.
World’s largest passenger carrier.
REASONS TO INVEST
100% FDI in the railway infrastructure segment has been allowed recently which has opened up opportunities for participation in infrastructure projects such as high-speed railways, railway lines to and from coal mines and ports, projects relating to electrification, high-speed tracks and suburban corridors.
Indian Railways has begun exploring the PPP mode of delivery and aims to award projects worth USD 1,000 Billion through the PPP route.
The sector aims to boost passenger amenities by involving PPP investments in provision of foot-over bridges, escalators and lifts at all major stations.
Last-mile connectivity to boost business activity in and around ports and mines has been proposed through the formation of special purpose vehicle (SPV) companies under the Public Private Partnership (PPP) model.
