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

1 32

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

1 32

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