Passline Business Magazine October 2012

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PASSLINE Sept 30 - Oct 31,2012

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TheWonderNutFrom God’s OwnCountry InIncredible India

Kerala StateCashew Development Corporation

Cashew House, PB. No: 13, Kollam- 691 001.Ph: +91 474 2742271/ 2742172/ 2742273

Fax: +91 474 2742557. email: [email protected],[email protected]

TheWonderNut

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PASSLINESept 30 - Oct 31,2012

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From the Editor

Editor & Publisher

Varghese Paul

KochiSREEJITH N KPh: 8129110602

ChennaiAugustine JosephPh: 09381000534

Manager-MarketingSajan K

Keethara Publications Pvt Ltd38/125 1st Floor, Narakathara Road, Kochi-682 035, Kerala, India.Phone : +91 484 4027002Editorial : +91 484 3043572Marketing : +91 484 4010075 484 3043325

Marketing Office:G-238, K C Joseph Road, Panampilly Nagar,Kochi-682 036Marketing : +91 484 4010075e-mail : [email protected]

Swift follow-up must replace lethargy

The monsoon at long last is playing its part somewhat well allaying the fears over the investment climate in Kerala. But on the eve of the ‘Emerging Kerala’ investment meet

due for September 12-14 in Kochi the Government and the media seem to be at loggerheads over creation of a climate for NRIs to invest in the state.

Just a few days before the meet, the voice of dissent, especially from Opposition leaders, is hovering over the horizon. They cite the failure of a similar summit held earlier. How fruit-ful was the much-hyped Global Investor Meet (GIM) is still a matter of debate, the people interpreting its outcome according to their whims and fancies. It is also true, to an extent, that no concrete facts and figures about GIM meet are available for would-be investors to have trust in the ‘Emerging Kerala’ programme. But as the dust and fury over the forthcoming meet die down, which it is hoped will happen soon, there should be swift follow-up action and measures by the authorities concerned which should come to the notice of the public, a shortcoming alleged against GIM.

Chief Minister Oommen Chandy has repeatedly asserted that ‘Emerging Kerala’ is not sim-ply an investors’ meet but an event to showcase Kerala as à friendly state to invest in’ and that the unfriendly attitudes of political trade unions have given way to a new business cli-mate favouring disposable income groups to venture into projects for growth and profit. The Chief Minister says that the pros and cons of every proposal for investment will be thoroughly screened and only the deserving will get a chance for investment. ``No inch of public land will be owned by private individuals but private landholders will be benefited if their lands are to be taken over,” he says.

Discussions and meetings are galore among the ruling cadres to make the summit a suc-cess. Opposition leaders too are assembling to hotly discuss and to arrive at a conclusion on the stand to be taken to please their vote banks.

Whatever be the charges and counter-charges, it is clear from the words and deeds of the Chief Minister, the Industries Minister, the Revenue Minister and officials concerned that Èmerging Kerala’ will be a different rich experience for potential investors. It is expected that Rs 60,000 crore worth of projects will see their birth in Kerala and that the nearly 43 lakh un-employed in the state will see their dream of securing jobs in their place of birth becoming true.

As they say the proof of the pudding is in the eating. So the success of the meet is not to be judged in the number of proposals for investment but the execution of projects as proposed because a lot of delay and lethargy are reported in the bureaucratic cadres to clear files and papers which affect completion of projects.

Therefore, certain stringent norms and follow-up steps need to be strictly enforced to maintain transparency in the execution of projects. Files or papers relating to the projects proposed at the Èmerging Kerala’ meet should be cleared within two months. It is better to have a single-window clearance system for all the investment proposals emerging at Èmerg-ing Kerala’. The public should also be made aware of the number of proposals that come up for investment, the number cleared, the number executed and the number (of people) em-ployed. There should be vigorous follow-up steps. All should remember that here is a historic opportunity for the state and let’s not miss it.

Varghese Paul


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No chit Act in forceWhen the Central Chits Act was implemented in

almost all states in India it was notified in Kerala also. But no visible change is noticed in the existing op-eration of the existing chitty companies. The notable clause incorporated in the chitty Act is the increase in the percentage of the auction discount which was fixed at 40% from the existing 30%. Even though the Act came into force in Kerala with a gazette notifi-cation of April 30, 2012 no private chitty companies seem to be operating under the new law. Even the new kuries announced by the private companies car-ry the tagline `registered before April 30’ obviously to skip the provisions of the new law. Even the state-run public enterprise also is not adhering to the new dis-count norm, it seems. Its new chits still enjoy an auc-tion discount of 30% instead of the stipulated 40%.

All these factors reveal that the new chit law is not in vogue in Kerala though the new Act is a reli-able force for the subscribers to reckon with. It is high time the Kerala Government saw the chitty compa-nies run according to the Central Act implemented in the state. Otherwise chits will still remain `the good old cheat business’.

Babu Joseph, Bangalore

Give and take pensionYour editorial on pension reform (Sept issue)

has been a bone of contention between the Govern-ment and the opposition parties from time immemo-rial. The proposal by the ruling front for participatory pension is a viable solution to the festering financial crunch dogging the Government. By this scheme the employees will have the credit of contributing to the Government exchequer and the Government will have the credibility of serving the retired while out of service. Moreover, pensioners will have the satisfac-tion of sharing the benefit derived from their service.

A pensioner is really a debt to the Government as there is no return from him/her. It is high time the Government recast the existing pension scheme to balance the economic equilibrium of the state.

Jinesh, Kannur

Vote out the corrupt``There are plenty of ways to reduce corrup-

tion but the Government is allergic to take up any. The anti-corruption farce will not reduce corruption. The situation seems to be grim, very grim”, says K P Joseph in his article (Sept issue). The concluding paragraph of the article is true, very true. An allergic disorder for which there is no remedy for the malice which afflicts the modern system of governance. If democracy is a system of governance corruption is a system of misrule.

Many Anna Hazares or Baba Ramdevs can wage a relentless struggle in the name of corruption provided one has the money power to back up. No doubt, money power can buy muscle power. And the `muscles’ will uphold the principles and hold up the flags mouthing slogan in favour of the protagonists without hurting the antagonists because the whole drama is enacted by the tainted characters.

In a democratic system corruption cannot be root-ed out by random protests or persons, because in a democracy it is not a single hand who is wielding the power but many hands. When the dictum says, ``power corrupts; absolute power corrupts absolute-ly’’ here, power corrupts many hands at a stretch. In a democracy corruption could not be rooted out; but only the corrupt can be voted out.

C I Baby, Idukki

`Pre-paid’ is `post-paid’The other day I travelled from the Ernakulam

North railway station to the TDM Hall, Ernakulam, in a so-called `pre-paid’ autorickshaw. What baffled me first was that I was not asked to make any payment beforehand although the person at the counter is-

sued a printed piece of paper after noting down the destination only, without mentioning any fare or charge. I paid the auto charge only at the destina-tion. What is the meaning of standing in a serpen-tine queue (post-Onam rush) to get a piece of paper wasting our time and money without any assurance on the fare to be paid.

Again, I had the same experience while hiring an auto from Thrissur railway station to Elite Hospi-tal where the man manning the counter jotted down something in his log book without issuing à piece of paper’ and I paid the fare which the auto driver demanded at my destination.

Pre-paid service is actually meant for averting any tiff or altercation over the fare between the hirer and the driver. But here, the service is not rendered at its right spirit leaving the passenger and the driver to their whims and fancies.

Bipin,Thrissur

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Dr V K Vijayakumar

“A bouquet of opportunities for the world to take note of, ‘Emerging Kerala 2012’ is

your opportunity to explore, invest and establish your business interest in Kerala. With proactive adminis-tration and investor-friendly policies this is your gate-way to make a mark on the industrial playground of Kerala.”

So goes the opening words on the website of ‘Emerging Kerala Global Connect’. Indeed, enticing! The potential is huge and the prospects are bright. But, will the potential investor bite the bate? Will the ‘Emerging Kerala Connect’ scheduled for Septem-ber 12-14 turn out to be a ‘development bus’ which Kerala will catch this time?

Kerala’s unique features, its strategic superiority and comparative advantages from the perspective of development have never been in doubt. In fact, Kerala’s record in trade and commerce is unique. As early as in 3000 BC Kerala had established itself as a major centre in the world spice trade. At the time of the formation of the state in 1956, Travancore was far more industrialized than most of the present-day industrialized regions of India. Fertilizers and Chemi-cals Travancore (FACT), Travancore Titanium, Tra-vancore Rubbers and Travancore Rayon had im-

ported technology and were pioneering ventures in India. It is not widely known that on the eve of the formation of the state, Travancore had the highest paid-up capital among the princely states of India. But after the formation of the state in 1956 the tempo of industrialization slowed down and even reversed.

The left ideology which has deep roots in Ker-ala—even the non-left parties assumed a leftist political posture to survive in the populist political game—created a socio-economic-cultural environ-ment which regarded industrialists as exploiters and expropriators. The strong trade union movement, the leading lights of literature and arts, the so-called cul-tural leaders and political parties combined to cre-ate a social perspective which viewed investors as exploiters and not as job and wealth creators. This negative social outlook cost Kerala dear. The state became a poor investment destination and came to be regarded as a ‘graveyard of entrepreneurs’. Con-sequently the productive sectors of the economy stagnated during the last quarter of the 20th century. But the state continued to remain high on the quality of life index thanks to the high social development indicators and the rising and sustained flow of remit-tances from abroad

.

The Kerala attitude towards industrialists and in-vestors has changed considerably in recent times. The collapse of communism in the Soviet Union and Eastern Europe and the bold change of track in China have substantially influenced the thinking of communists. Consequently they—particularly under Buddhadeb Battacharjee in West Bengal—started rolling out the red carpet for private capitalists. This pro-investment attitude encouraged other political parties also to strike a bold posture on industrializa-tion and growth.

The trade union movement in Kerala today is re-sponsible and pragmatic, in spite of some isolated instances of insane union behaviour. In terms of the number of days lost due to strikes and lockouts, Kerala has a very good record in recent times. In brief, the capitalist-labour relation is not adversarial in Kerala today. ‘Emerging Kerala Connect’ is a sin-cere and timely attempt to exploit this new business environment.

The Government has identified 26 sectors for showcasing in ‘Emerging Kerala’. Appropriate policies and projects in these sectors will be announced at the meet. Such policies and projects will be present-ed before investors. Also, road shows are planned

The Kerala attitude towards industrialists and investors has changed considerably in recent times. The trade union movement in

Kerala today is responsible and pragmatic, in spite of some isolated instances of insane union behaviour. In terms of the number of days lost due to

strikes and lockouts, Kerala has a very good record in recent times. In brief, the capitalist-labour relation is not adversarial in Kerala today.

‘Emerging Kerala Connect’ is a sincere and timely attempt to exploit this new business environment.

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abroad. The sectors are: tourism; healthcare ser-vices; manufacturing including engineering and au-tomotive; MSME projects; IT/ITES/IT infrastructure; trade and retailing; food and agro-processing; ports and shipbuilding; textiles and garments; electron-ics; knowledge/education; green energy; biotech-nology; nanotechnology; pharmaceuticals; urban infrastructure development; infotainment; logistics; petrochemicals; gas-based industries; airport infra-structure, aeroplane and helicopter services; centres

Potential sectors for developmentThe Government has identified 26 sectors for showcasing in ‘Emerging Kerala’. Appropriate policies and projects in these

sectors will be announced at the meet. Such policies and projects will be presented before investors.

The sectors Tourism•Healthcare services•Manufacturing including engineering and automotive•MSME projects•IT/ITES/IT infrastructure•Trade and retailing•Food and agro-processing•Ports and shipbuilding•Textiles and garments•Electronics•Knowledge/education•

Green energy•Biotechnology, nanotechnology, pharmaceuticals•Urban infrastructure development•Infotainment•Logistics•Petrochemicals•Gas-based industries•Airport infrastructure, aeroplane and helicopter services•Centres of excellence•Infrastructure development (roads, power, •water supply, sewage)

of excellence; infrastructure development (roads, power, water supply, sewage).

In some of these sectors Kerala has unique strate-gic and natural advantages and therefore investment in projects in these sectors will be highly rewarding to investors and beneficial to the State. Ongoing ma-

jor projects: Kerala already has some ongoing major projects like the supplementary gas infrastructure project, the Vizhinjam international seaport, the high-speed rail corridor, the Kochi-Palakkad NIMZ, Titani-um sponge, the petrochemical project, Kochi metro, mono rail in Thiruvananthapuram and Kozhikode, Life Sciences Park in Thiruvananthapuram and the electronic hub and oceanarium in Kochi. Some of these projects are only in the very early stage and some are yet to complete a viability study; yet these

are ambitious projects which, when completed, will alter the face of Kerala.

Another potential game changer for Kerala is the Sam Pitroda Initiative which has identified major projects such as coastal navigation, knowledge city, global centre for ayurveda, waste management and

e-governance for comprehensive and sustainable development of the state.

The Chief Minister expects to attract investments worth Rs 1 lakh crore from the meet. This is, indeed, ambitious but achievable, provided the state follows up the initiative by addressing some major chal-lenges such as waste disposal, power availability, roads and other infrastructure issues. Appropriate policies and programmes addressing these issues are expected to be announced at the meet. Kerala’s

potential and prospects are huge, but we have miles to go. If the vision of ‘Emerging Kerala Connect’ is translated into action, the state will take off to realize its true potential.

(The writer is Investment Strategist at Geojit BNP Paribas)

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The State Government recently completed one year in office.

Can you take us through the ups and downs you witnessed during the pe-riod? What has been your learning experience?

We set out on our journey one year ago with a clear vision and specific goals. On completing one year in of-fice, we were able to achieve in time over 90% of the targets. Out of the 107 projects listed out for our 100-day programme, we completed 101 before time. That was a remarkable start. We issue rice to 21 lakh at one rupee and have issued ration card for more than five lakh families. We have also made arrangements to issue ration card on the same date of application, if the request is complete in all respects. This is a remarkable achievement.

Our action plan is aimed at trans-parency to stamp out corruption, of-fering clean and green surroundings, netting higher economic growth, lay-ing down strong infrastructure, ensur-ing better health and driving the digital revolution, besides social welfare. I have always believed that ideas and

“There was a feeling earlier that Kerala is

not an investment-friendly state. This is not true today.

We want to give a message to the rest of the

world that Kerala has changed a lot and that our state is a

good destination for investment. Besides

that the goal of the ‘Emerging Kerala’ meet is not just to

attract investment. It is also to present a new

Kerala before the global audience as a destination worth

exploring in various fields,” says Chief Minister Oommen

Chandy in an email interview given to PASSLINE on the eve of

the ‘Emerging Kerala Global Connect’.

actions need to go forward at the same pace. Work with dedication, and the results will come naturally. There should be a human face to all our ac-tion plans and endeavours towards economic growth; we should keep people informed, take them into confi-dence and show that the Government exists for them.

Infrastructure is the backbone of any state’s economy. A number of mega-projects are being conceptual-ized and developed in the state. Can you take us through these projects?

We have given the highest priority to infrastructure development. Kerala has achieved a lot in education, health and other social sectors in which it is the first among Indian states. But we are lagging in infrastructure and in-vestment. We know these weakness-es in the development sector. So we want to overcome these hurdles and leap forward in this sector. The Gov-ernment intends to develop road, rail, mass transportation, urban infrastruc-ture, power and water supply projects. The allocation envisaged for the sector during the 12th Plan period is around Rs 15,000 crore.

Some of the mega-projects that can change the landscape of Kerala in a few years are: the High Speed Rail Corridor connecting Thiruvanan-thapuram to Mangalore (Rs 1,18,000 crore), Mono Rails at Thiruvanan-thapuram and Kozhikode (Rs 5,000 crore), gas-based power plants (Rs 8,000 crore), Vizhinjam International Deepwater Multipurpose Seaport (Rs 3,000 crore), Kochi-Palakkad Na-tional Investment and Manufacturing Zone (Rs 52,000 crore), Kochi Metro Rail (Rs 4,500 crore), Kannur Inter-national Airport (Rs 4,500 crore), Tita-nium Sponge Plant (Rs 3,500 crore), Electronic Hub, Kochi (Rs 750 crore), Oceanarium, Kochi (Rs 350 crore) and Life Sciences Park, Thiruvanan-thapuram (Rs 300 crore).

What are the investment opportuni-ties in these? How beneficial are these projects when they get completed?

We had earlier some reservations on BOT and PPP models. This was a setback to our development plans. At the same time we have a successful model of PPP in developing the Kochi airport. That was the first PPP model of airport in the country. CIAL is one

of the best international airports of the world considering the investment-prof-it ratio. Now we have an open mind on BOT and PPP models and our only condition is this must be beneficial to the state.

Once these projects are completed, Kerala will be far ahead of its peers in terms of infrastructural development. We will bring closer to the reality our dream of turning Kerala into an equi-table, enterprising and welfare state.

The Kerala Government has launched an intensive campaign ‘Emerging Kerala’ to transform the state into a global hub for investment. What inspired you to come out with such a campaign?

There was a feeling earlier that Kerala is not an investment-friendly state. This is not true today. We want to give a message to the rest of the world that Kerala has changed a lot and that our state is a good destina-tion for investment. Besides that the goal of this meet is not just to attract investment. It is also to present a new Kerala before the global audience as a destination worth exploring in various


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fields. We are rebuilding the strengths that have always put Kerala a step ahead of other states, whether it is in education, health, green environment, law and order or political stability. We are positioning our advantages be-fore the world through this rebranding campaign called ‘Emerging Kerala’. God’s Own Country is a land of op-portunities, not just in tourism, but in all sectors. It is time for us to take this message to the world.

As I said earlier, we are acceler-ating our pace of development. We have to pitch our strengths at the right time before the right people on the right platform. ‘Emerging Kerala’ intends to be that platform.

What are your Government’s fu-ture plans to transform the state into a global hub?

We have made the right beginning by projecting our core strengths. The campaign has had a good impact so far, and several countries are to take part in the ‘Emerging Kerala Global Connect’ at Kochi during September 12-14. The Prime Minister will inaugu-rate this summit which is more than just an investors’ meet. It is going to generate a pool of ideas that will drive the future of the state. We have also put in place a mechanism to follow up on the results of the meet. We will make sure that the leads generated

from this global session, featuring ac-ademics, policymakers, experts and investors, are translated into actions and that those actions yield results. This event is only a starting point for continued engagement with business-es and other interests outside Kerala. The purpose is to build long-term, abiding relations which could fructify after the event.

How much of investment do you expect from this campaign? Do you think that the investment figures can outperform that of other states? Can you tell us how much of the agreed investments convert into actual in-vestments?

As I said earlier, the goal of ‘Emerging Kerala’ is not just to attract investment. We are not very much concerned about the quantum of in-

vestment. ‘Resources’ is not a barrier to development. We want to show our strength and show the prepared-ness to help people do business in Kerala and with Kerala.This is not just an investors’ meet. We are not setting any targets for investments; nor are we worried about figures. It is not the Government’s intention to just promote signing of MOUs during the event. The idea is to showcase and create opportunities rather than generate MOUs. We are not compet-ing with other states in terms of the quantum of investment. We have our unique attributes and our potential which will drive investment and fur-ther productive economic activities. I am sure that the event will be a huge opportunity for all to learn more about Kerala and to be a partner in the state’s endeavour to become one of the most globally advanced societies.

What are the highlights of the pro-gramme and how many sectors will be showcased to investors?

‘Emerging Kerala’ will provide an opportunity to the delegates for business-to-business meetings, round tables in which both Union and State ministers would participate, meetings with other country delegations and foreign trade missions.

This will be a forum where the delegates can present proposals

for collaborations in their areas of strength. There will also be a technol-ogy exhibition that will display a range of available technologies which could be put into commercial use.

We have identified 26 thrust sec-tors which have high growth potential. Nearly 200 projects are to be show-cased and placed before the visitors.

There is often criticism that such investors’ meets often promise huge sums but deliver little. Do you think ‘Emerging Kerala’ will change this perception? If yes, how?

‘Emerging Kerala’ is to showcase our strengths, our potential and the opportunities for investors. We are also creating a platform to bring some great minds together to gener-ate ideas that can power our future growth. We are quite sure about the outcome of this meet.

This will be the beginning of a long march for our State to achieve further heights of development. Kerala has changed a lot recently and we want to show this change to the rest of the world. We want to get positive results from this change. We are sure that the path we are treading will give us clear signals to adopt the right poli-cies towards achieving our ‘Vision 2030’.


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What is the aim of ‘Emerging Kerala’? How does the programme benefit the common man?

It is a sustained campaign to showcase the strengths and potential of Kerala, both in terms of growth and investment. We want to show the world our proactive policies, our commitment to inclusive development and sustainability and our efforts to create an investor-friendly environment. ‘Emerging Kerala’ will bring together some of the finest think-ers and policymakers we have today. So it will also be a brainstorming exercise to generate ideas and strategies that will drive our future growth.

‘Emerging Kerala’ will facilitate business-to-business meetings, round-tables in which both Union and state ministers will participate, meetings with other countries’ delegations and foreign trade missions, country sessions and sectoral sessions. On the sidelines, we will have an exhibition of a range of available technologies that can potentially be commercialized.

All the projects we have drafted, all the strat-egies we are going to discuss at the summit and all decisions we take as a follow-up to this initia-tive will be directed towards our goal of inclusive development. We want the benefits of economic growth to reach everyone in every part of the state. Our strategies target jobs creation, entrepreneur-ship opportunities, better healthcare and educa-tion, food security, world-class transport network, improved standards of living and a strong social fabric. ‘Emerging Kerala’ is a key step in that direc-tion.

What are the major sectors given priority at ‘Emerging Kerala’?

Twenty-six sectors have been identified as hav-ing high growth and investment potential for Kerala. The core sectors are IT and ITeS; tourism and med-ical tourism; healthcare; food and agro-processing; knowledge and education; ports, shipbuilding and logistics; energy including green energy; biotech-nology; nanotechnology and other sunrise sectors; financial services and infrastructure development.

What are the major projects to be showcased at the programme? How much investment do they require?

We have planned a host of mega-projects, par-ticularly in the infrastructure sector, which has been given the highest priority. Some of these projects are: a high-speed rail corridor connecting Thiru-vananthapuram to Mangalore (Rs 1,18,000 crore), mono rails at Thiruvananthapuram and Kozhikode (Rs 5,000 crore), gas-based power plants (Rs 8,000 crore), Vizhinjam International Deepwater Multi-purpose Seaport (Rs 3,000 crore), Kochi-Palakkad National Investment and Manufacturing Zone (Rs 52,000 crore), Kochi Metro Rail (Rs 4,500 crore),

The forthcoming ‘Emerging Kerala Global Connect’ is meant to proclaim to the rest of the world that the state

provides immense scope and opportunities for investment. In a candid interview to PASSLINE, Mr P K Kunhalikutty,

Kerala’s ebullient Industries and IT Minister, discusses what the event is and the possibility

of the state emerging as a hot favourite of investors from around the

world. Excerpts:

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The driving force for future growth: Kunhalikutty

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Kannur International Airport (Rs 4,500 crore), Titanium Sponge Plant (Rs 3,500 crore), Elec-tronic Hub, Kochi (Rs 750 crore), Oceanarium, Kochi (Rs 350 crore) and Life Sciences Park, Thiruvananthapuram (Rs 300 crore).

While states such as Karnataka, Gujarat, Maharashtra, Tamil Nadu and Andhra Pradesh have held similar events calling for investment, will Kerala be able to match their figures?

We are not competing with any of the states for investments and we are not comparing our initiative with any such programmes undertak-en elsewhere in India. ‘Emerging Kerala’ will highlight the best of Kerala. We have plenty of unique attributes and potential to attract invest-ments and we have a development strategy tai-lored to our specific needs.

There is often criticism that such investors’ meets often promise much but deliver little. How do you think ‘Emerging Kerala’ will change this perception?

The disappointments and criticism result from unreasonable expectations. We have

a very clear vision of ‘Emerging Kerala’. We know exactly what we want it to be—a platform to showcase Kerala—and we are on course to achieving its objectives. There are no quantified targets. And this is not going to be an isolated exercise. We are backing our call for invest-ment with all-round support, including policy frameworks, incentives and fast-track clear-ance systems.

F High-speed rail corridor con-necting Thiruvananthapuram to Mangalore (Rs 1,18,000 crore),

F Mono rails at Thiruvanan-thapuram and Kozhikode (Rs 5,000 crore),

F (Rs 8,000 crore), F Vizhinjam International Deep-

water Multipurpose Seaport (Rs 3,000 crore),

F Kochi-Palakkad National In-vestment and Manufacturing Zone (Rs 52,000 crore),

F Kochi Metro Rail (Rs 4,500 crore),

F Kannur International Airport (Rs 4,500 crore),

F Titanium Sponge Plant (Rs 3,500 crore),

F Electronic Hub, Kochi (Rs 750 crore),

F Oceanarium, Kochi (Rs 350 crore)

F Life Sciences Park, Thiru-vananthapuram (Rs 300 crore).

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Can a state like Kerala, which suffers from dearth of land, contain these mega-projects?

We are aware of our limitations in terms of land. If you look carefully at the proposed projects, you can see they have been designed with minimal land requirement. Take the high-speed rail, for instance. Most of the over-500 km of track will be on stilts, underground tunnels and bridges so the land re-quired is relatively very little. A lot of planning has gone into these projects and we are presenting them at ‘Emerging Ker-

ala’ because we believe they are a viable option for us. We are also open to any suggestions or recommendations that will help us improve these plans.

Concerns have also been raised about the environmental impact of some of these proj-ects. How is the Government going to address them?

Sustainability is at the core of our devel-opment agenda. We know that greenery and beautiful natural landscapes are inseparable from our identity as a state. We will make sure that industrial and economic development does not come at the expense of the environment. Our checks and balances will be in place from the planning stage onwards. Only projects that ensure optimal utilization of resources and are not damaging to the environment will be put for-ward.

How long will it take for projects showcased at ‘Emerging Kerala’ to actually be implement-ed? When can we expect to see the results of this initiative?

It would be unreasonable to expect an over-night transformation as a result of ‘Emerging Kerala’. It is going to be a programme of contin-uous engagement. However, we are committed to ensuring that all projects we start are com-pleted in a time-bound and cost-efficient man-ner. Large infrastructure projects, as we know, take time to complete. They will be our legacy for future generations. Even smaller projects can create large economic and social benefits, for instance, through jobs creation and commu-nity development.

Kerala has always been criticized for union-ism from labourers. How will it affect the new projects?

Unionism is a thing of the past and there is no such trouble in Kerala now. Workers turn hostile when they feel they are being exploited. But we have strict laws to prevent such exploi-tation. The state has now become both labour-friendly and industry-friendly.

The only problem now is the lack of labour-ers for construction and other related sectors. We have to depend on migrant workers from the North and the Northeast for such kinds of work.


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The focus of the ‘Emerging Kerala Summit’ that is being held in Kochi in September is

on industrial development by bringing potential investors to the state. Though education is an important priority of the Government’s concerns it is not a major one. The Government’s chief strategy in the field of education seems to be centering around inviting foreign universities into the state, mainly from the UK and the US.

But it is a mistaken belief that arrival of foreign universities can raise the standard of education in the state. Foreign universities are not aware of our customs, culture and societal requirements. Importing their methods into the state will not yield the desired results all of a sudden. The standard of education could only be raised by years of dedicated academic activity aimed at excellence. Moreover, these foreign universities will be new players from among second-level institutions and so we cannot expect them to deliver better results than those provided by existing Indian players.

The self-financing professional institutions have played a vital role in improving the quality of education in Kerala apart from accessibility and affordability. Yet generally they are perceived as a sort of commercial propositions keen on exploiting the public in the name of education. The Government also endorses this misperception to some extent.

The reality is the self-financing colleges have done a remarkable job of distribution of education into more geographical areas apart from other contributions. In the past, it was difficult to find premium professional institutions in the suburbs and rural areas as they were mainly concentrated on the urban areas. Moreover, they were very few in number. Private colleges have successfully broken the barriers of geographical boundaries and penetrated into the rural areas. They must be lauded for giving easy and

ready access to students for quality education even to the rural children.

Apart from this, the self-financing colleges have created considerable opportunities for various other sectors to grow. Book publishers and suppliers are reaping a huge harvest because of the growth of the private colleges. The premium self-financing colleges have to invest large amounts in developing the infrastructure and amenities within the institutes and this has benefited manufacturers and suppliers of machinery and equipment, lab items, computers and other peripherals.

A major chunk of the foreign exchange income of the state is from the Gulf, where a large number of Keralites are based. Earlier these remittances were too low because the emigrants were not qualified enough to get highly-paid jobs. But now the trend has reversed resulting in an increase in the remittances because we are able to send abroad a new generation of highly qualified and efficient professionals. And the credit must go to the self-financing colleges for churning out qualified professionals.

Considering these things, the Government should allow the private players to establish universities and autonomous colleges. The Government

can fix standards for colleges to grow as centres of excellence. And if they successfully meet these standards they should be given autonomous status. So also, high-quality academic groups should be given the status of private university as other states are doing. These measures will eventually reduce the migration of students seeking better education to other states and outside the country. The SCMS Group plans to present this problem at the ‘Emerging Kerala’ meet.

As part of the summit, SCMS has already submitted a proposal to establish an academic complex at a total investment of Rs 150 crore. This is planned to be established in the Smart City in Kochi. This project is founded upon the modern concept of total education encompassing all strata of academic life starting from the playschool to higher secondary school to engineering college to management institution along with a high-tech training institute. The project will be targeting professionals who are working in the companies within the Smart City once it comes into being. The playschools are meant for their kids, and then they go on to primary and secondary schools and engineering and management institutes. The high-tech technical training centre is for enhancing the efficiency and knowledge of the professionals in the IT companies. These schools and colleges will have high-profile faculty members. Arrangements will be made with the companies to absorb the students from these institutes.

In Kerala, we find a number of colleges operating under a single university. Mahatma Gandhi University alone has about 280 colleges affiliated to it. This causes long delays in the publication of examination results which, in turn, presents students with great difficulty. Increasing numbers of colleges without increasing the number of universities will never enhance the quality of education. But no government—Left or Right—has had

any serious reflection on this aspect of education.

SCMS has been concentrating on the higher education sector for the last 36 years. The Smart City project is expected to give thrust to innovation from a basic level. This is important considering the mess the Government has brought upon the field of education especially at the primary and higher secondary levels. The Government recently celebrated the completion of one year in office in the state. But the Department of Education has all along been mired in controversies. This has marred innovation in education at Government level.

The courses offered by SCMS may seem expensive but we ensure a better high-quality system of education. Quality in education can only be achieved at a high price. And the students who pass out of its institutions quickly morph into better professionals.

The SCMS Group also plans to set up a business school in London. The primary aim of this school is not profit but the exchange of knowledge. The students of SCMS in Kerala can visit the school in London and can taste the exotic ways of teaching there. This business school will act as an easy channel to import foreign faculty and also give our faculty an opportunity to teach in a foreign country.

The SCMS Group also plans to set up a large campus in Bangalore work of which is in progress. All the institutions in Bangalore will be of international standards.The exchange of knowledge is something which the Government can emulate instead of giving free reign to foreign universities.

(The writer is founder Chairman of the SCMS Group of Educational Institutions, Kochi, and national President of the Federation of Associations of Private Unaided Professional Colleges)

‘Foreign varsities can’t raise education standards’

Dr G P C Nayar

It is a mistaken belief that arrival of foreign universities can raise the standard of education in the state. Foreign universities are not aware of our customs,

culture and societal requirements. Importing their methods into the state will not yield the desired results all of a sudden. The standard of education

could only be raised by years of dedicated academic activity aimed at excellence. Moreover, these foreign universities will be new players from among second-level

institutions and so we cannot expect them to deliver better results than those provided by existing Indian players.

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Inkel: serving the needs of investors

The thrust of the first ‘Emerging Kerala Connect’ will be to attract the maximum number of CEOs, leaders, influencers and such

others who will make a difference and create a positive opinion, ac-cording to Mr V Somasundaran, Additional Chief Secretary, Industries Department.

According to the data as of August, more than 2,000 online reg-istrations had been received and delegates from over 36 countries would participate. This is over and above the specific confirmations obtained from various quarters across the globe for participation, he says.

The emphasis will be on attracting lead-ership, both from India and abroad, from all walks of life to participate in the event. These could include corporate leaders, heads of gov-ernment (both central and state), foreign digni-taries, heads of institutions such as SEBI, RBI and IRDA; renowned scholars, Nobel laure-ates, leading economists and eminent person-alities and business leaders.

Thrust will also be given to green and en-vironment-friendly industries that can harness the immense bounty nature has given the state, while also helping in preserving it for pos-terity, Mr Somasundaran says.

Skill training and entrepreneurship development being a prime fo-cus area for the Government, a special round table dedicated to this also finds a place among the ‘Emerging Kerala’ programmes. There will be ‘country sessions’ wherein delegations and business/trade mis-sions from various participating countries will present their proposals for mutual cooperation. B2B and B2G connects will happen on the sidelines of the event.

Multiple means of spreading the message are being utilized for propagating ‘Emerging Kerala’. These include using every opportunity to showcase the event, a well-designed website, social media chan-nels like Facebook, Twitter, Emerging Kerala blog etc.

The right kind of messaging is being done with the help of profes-sional PR firms and industry bodies and associations. Increasing vis-ibility at every opportunity that is available leading up to the event is of paramount importance, says Mr Somasundaran.

‘Thrust to attract maximum investors’

‘Emerging Kerala’ is conceived as a biennial global connect

initiative—one that will be held every two years. Stakeholders from all sectors, especially the thrust sectors, would be part of the deliberations that take place running up to and during the course of the event, Mr Alkesh Kumar Sharma, Managing Director, Kerala State Industrial Development Corporation (KSIDC), says.

A high-power committee under the chairmanship of the Chief Minister and project committees under the chairmanship of the ministers of the departments concerned have been constituted. KSIDC has been appointed

the nodal agency for the conduct of the programme, he says.

To emphasize the investment-friendly aspect, the necessary clearances shall be given by the Single Window Clearance Board which is designated for this purpose as the

clearance committee for all new project proposals coming through ‘Emerging Kerala’. Special packages of incentives for the projects in the respective sectors are being devised by each department and will be finalized by the high-level committee.

All Government departments and agencies concerned have developed project profiles in areas specified, identified locations and will facilitate implementation of the projects. Project profiles that present investment ideas to potential investors and entrepreneurs were prepared by sectoral task forces incorporated for this purpose. These

KSIDC for fast clearance of projects

V Somasundaran

Alkesh Kumar Sharma

Infrastructure Kerala Limited (Inkel) is an innovative public-private partner-

ship (PPP) initiative which brings together Government agencies and prominent glob-al investors and NRI industrialists and busi-nessmen. Twenty-six percent of its shares are owned by Government agencies, pub-lic sector undertakings (PSUs), investors, NRIs and businessmen and the remaining 74% by nonresident Keralites (NRKs), indi-viduals and banks, including Federal Bank and State Bank of Travancore (SBT).

Inkel plays a spe-cial role in the upcom-ing ‘Emerging Kerala Global Connect’. When private-sector investments flow into the state, industrial-ists, mostly from out-side the country, will seek local partners. Inkel serves their need either by becoming the partner or finding suitable partners for the investors, says Mr T Balakrishnan, Managing Direc-tor, Inkel.

The Government support will be provid-ed by agencies like Kinfra and KSIDC but Inkel intervenes where the investors need support from the private sector.

“Inkel provides assistance in equity, tech-nical support, liaising, marketing, godown facilities and land,” says Mr Balakrishnan. “Inkel will provide the land either by pur-chasing from private parties or by joining hands with KSIDC or Kinfra.”

In short Inkel plays roles like a consult-ing agency, an investor, or an agency which finds potential investors to partner with. As

part of ‘Emerging Kerala’, many investors have already approached the company. Sometimes KSIDC routes the clients to In-kel. The clients will pay Inkel for its consul-tancy services.

Mr Balakrishnan stresses that Inkel will only take up projects of Rs10 crore and above which means medium and large en-terprises.

Inkel’s 2.2 lakh sq ft standard design modules at Angamaly will be inaugurated in September. Already 60,000 sq ft of space has been booked by four companies, which include a Chinese company that manufac-tures electric scooters, Mr Balakrishnan says.

The modules are suitable for electron-ics, light engineering, printing and publish-ing, warehousing, logistics, financial and a host of other service sectors. They will be made available to entrepreneurs and inves-tors on lease for 30 years or on monthly rental basis. The lease rate starts from Rs 1,550-Rs 1,725 a square foot for 30-year lease and Rs 16-Rs 19 for monthly rentals.

Inkel has 30 acres of land in Kochi which the Government had taken over from Trans-formers and Electricals Kerala (TELK), Angamaly, and given to Inkel for lease of 90 years. Inkel possesses funds of Rs 140 crore so it will face no financial trouble in starting projects, Mr Balakrishnan says.

He says ‘Emerging Kerala’ is not merely an investors’ meet and stretches itself to di-mensions other than economic.

Its aim is to highlight Kerala as a social and cultural destination as well as a haven for industrial investments.

also look at enabling policy constructs and clearing road blocks.

According to Mr Alkesh, opportunities to create a positive message towards investor-friendliness will be undertaken. For example, fast-track clearances of bottlenecks and impediments to projects have been undertaken.

As a prelude to the event, a series of domestic and international road shows were conducted to gather interest going into the main event. A presentation that encapsulates the essence of ‘Emerging Kerala’ has been showcased at various events and forums.

T Balakrishnan


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The Kerala Government is organiz-ing an ambitious meet, ‘Emerging Ker-ala’, to attract more investments to the state. Do you think that programmes like these will help boost the state’s economy?

Mithun Chittilappilly: I think many states are taking a leaf from (Gujarat Chief Minister) Narendra Modi’s book to try for and revive investments. In-vestments will automatically come if the Government does its bit in im-proving basic infrastructure like roads, power and land as Gujarat has already done.

Akshay Agarwal: Certainly. Pro-grammes like these help in bringing awareness about the new face of Ker-ala, that of Kerala wanting to become an investment destination, especially on the services sector side. That it has boosted the state’s economy is a point proved conclusively: we now have some of the best service-sector giants of India having good presence in Ker-ala, be it Infosys or Wipro in software or the Taj Group in hospitality or L&T. The large hospital chains and the even larger shopping malls are all changing the face of Kerala.

Christo George: No doubt, it will definitely boost the economy. Such programmes will initiate a mindset in the young generation making them think about the option of becoming an entrepreneur rather than seeking a job. In turn it will create job opportuni-ties for thousands of people.

Bhuvenendran: First of all, such programmes are required in order to have awareness among the global investors with regard to the invest-ment opportunities in Kerala. This is more so when other states and coun-tries conduct similar programmes and implement plans to attract investors. Through such programmes one could source big projects which will most certainly aid the economy.

George Paul: ‘Emerging Kerala’ is a laudable initiative by the pres-ent Government unlike the previous Government which was suffering from

ideological paralysis. The mindset of the Government is made clear by this initiative. It will certainly create momentum on the industrial scene of Kerala and it will help boost the state’s economy.

As a successful entrepreneur, do you have any suggestions and advice to intending investors?

Mithun: Kerala is a place for ser-vices industries like tourism and IT.

Akshay: Every place has its plus and minus points, and so has Kerala. Labour, for example, is still an issue, but then there is now a will to sort things out. Things are improving. But look at the positives: it is one of the best con-sumer states in the country; its tourism industry is booming; it is finding a good foothold in software… The bottom line: Be aware of the drawbacks, but build on the strengths, and suit your busi-ness and policies accordingly.

Christo: As an entrepreneur I think Kerala is an ideal place to invest in. Not all types of industries are suitable for Kerala as it is very thickly popu-lated. Any enterprise will be success-ful if people living nearby are made to involve themselves in it and the neigh-bourhood gets a feeling that it is ben-efited by that industry. There is a mis-conception that unions and workforce are difficult to handle in Kerala. But if they are encouraged to get involved in the growth of the company and when they start feeling that if the company grows they also get benefited, Ker-alites are the best workforce any en-trepreneur can choose.

Bhuvenendran: One should have a clear-cut vision on what one does and what one is going to do and should be sincere with what one does, and give emphasis on quality and service.

George Paul: In order to be suc-cessful in any enterprise it is impor-tant to manage human resources ef-ficiently and effectively. Productivity and the quality of the product will have to be enhanced on a continuous basis to ensure competitiveness. This could be accomplished by imparting training

to the employees on a regular basis. Possibly TPM (total productive main-tenance) could be taken up from the very beginning. Innovation and R&D initiatives are crucial in today’s con-text to benchmark the product to world standards.

Do you think that in Kerala there are areas still lying vacant for invest-ment? If so, can you give details?

Akshay: Health and education are two major sectors where there is still huge scope for investments. So is lo-gistics. It is surprising to see a great many of our kids going to other states to complete their education, the prime reasons being the non-availability of seats and need for much higher qual-ity of teaching and exposure. God has given Kerala the best of tourism oppor-tunities and, thankfully, the state has promoted itself as a high-end tourism destination and reaped the benefits. Our state has some good medical fa-cilities. If we can combine healthcare and tourism, the potential is huge. Similarly, with Kerala clearly emerg-ing as a major consumer state and a major port destination, logistics holds great potential.

Christo: Kerala is an ideal place to have investments in the service sector as well as other non-polluting industries. The knowledge base and skill of Keralites are high compared to other states. It is easy to get the kind of workforce even in the villages of Kerala and there is great potential for technology-based industries and ITES industries to be successful if invested in the right way.

Bhuvenendran: Lack of infra-structure is the main bottleneck of our growth so there are vast opportunities in the infrastructure sector.

George Paul: Biotechnology is one area in which there is tremendous scope for investment. This is particu-larly because of the availability of the large pool of flora of the state. The nutraceutical (phytochemicals from plants) stream has also emerged as an important space for development.

How the event will benefit all: industry leaders speak up1514

PASSLINEPASSLINE Sept 30 - Oct 31,2012 Sept 30 - Oct 31,2012

On the eve of the ‘Emerging Kerala Global Connect’ being held in Kochi from Sep-tember 12-14, 2012, PASSLINE sought the views of some industry leaders about the event, how effective and responsive it will be and how it will benefit the people

and the state. The comments of Mr Mithun Chittilappilly, Managing Director, V-Guard In-dustries Ltd, Kochi; Mr Akshay Agarwal, Vice-Chairman, Acumen Capital Market (India) Ltd, Kochi; Mr Christo George, Chairman and Managing Director, Hykon Group of Companies, Thrissur; Mr N Bhuvenendran, CEO, Hedge Finance Ltd, Kochi; and Mr George Paul, Director, Synthite Industries, Kochi; are detailed below:

Akshay Agarwal

Bhuvenendran

Christo George

George Paul

Mithun Chittilappilly

15


How the event will benefit all: industry leaders speak upWe have many unutilized and unculti-vated tracts of land in the interiors of Kerala. Depending on the nature of the enterprise, land can be easily identi-fied for such purposes. In this context, heavy industries causing environmen-tal pollution shall not be considered by the Government.

Do you think that there is an atmo-sphere conducive to investors now as the Government says?

Mithun: The atmosphere in Kerala is as conducive as in any other state in India these days. Days of internal la-bour problems are not there although militant trade unionism still persists.

Akshay: It definitely is much better than it used to be. A lot still needs to be done in areas like labour, litigation risk and general attitude to work. The state needs to move from the general laid-back kind of nature to get the go-getter attitude that we see in quite a few other states. This can be done only through governmental will and massive mass training exercises.

Christo: Kerala is one of the best places to invest in the right industries compared to many other states in In-dia. One of the major improvements required in Kerala is the reduction of bureaucratic red tape, like getting sanctions and approvals. Change in the mindset of Government officials to help industries is required. The focus should be on:

Not creating problems but solv-• ing problems

How to pass or sanction the file • instead of rejecting the file

How to solve an issue rather • than to create delays in solving an issue

Bhuvenendran: The atmosphere has improved much from what it was in the last decade but it has to improve much more.

George Paul: But for the politi-cal controversies and ideological set-backs, the atmosphere is undoubtedly conducive. Certain politicians are a threat to the developmental initiatives of the state.

There are doubts among many about the efficacy of investment meets in the light of the Global Investor Meet (GIM), held a few years ago, having turned out not very successful. They feel that these meets are held just to attract media glare. What, according to you, should be the general attitude of the authorities to attract investments to the state? What is really needed to make them successful?

Mithun: The Government should be spending more money, time and effort on improving infrastructure like roads and stable power and only then will businesses and entrepreneurs really have the confidence to invest here.

Akshay: A lot of the proposals that come up during these kinds of meetings do not actually take off. The reasons are varied: non-seriousness on the part of the proposer, bureaucracy and red tape, litigation, multiple approvals from various authorities etc. Neverthe-less, the will is definitely there, and that is the first requirement. Better follow-up, fast and single-window clearances, availability of land, subsidies etc can make substantial differences.

Manufacturing is something we have constantly tried and mostly failed, the most common reason being the high cost of labour, both in terms of wages and productivity. For this to im-prove, the two most important things are governmental will and a change in the general attitude.

Christo: If the Government wants to attract investments to the state, it should highlight success stories of a minimum 100 industrialists who achieved success by investing in Kerala and these stories should be highlighted by the media to get global attraction. The Government should also initiate steps to revive at least 100 industries which were failures or were running at losses. Step by step the Government should bring those industries back to success by involving Government de-partments and industrial associations. They can be projected as case studies which will definitely boost the image of the State Government as an industry-friendly Government.

Bhuvenendran: It is true that the Global Investor Meet did not turn into a much fruitful one, where the Govern-ment simply signed MOUs with every other proposal. So it will be better to invite more serious investors and enter into agreements with projects which have greater possibility of happening.

George Paul: The most important factor is the determination of the au-thorities for successful implementation of projects. If the Government is con-vinced of the feasibility of a project it is to be implemented with a strong will. The authorities have to be facilitators rather than regulators.

The state’s lack of infrastructure in many other fields has obliged it to di-versify the economy into tourism, hos-pitality, private healthcare, education, IT and ITES. What future do you see in these fields?

Mithun: Kerala can still be a good place for tourism, healthcare and IT as it has a large pool of engineers and medical professionals and great natu-ral beauty.

Akshay: Given the limitations that our state has in manufacturing and in-frastructure, moving to the service sec-tor is a smart thing to do. Kerala has definitely made a name for itself in the above fields, and is progressing quite well. There is no doubt that these will hold us in good stead in the times to come. Having said that, for wholesome and organized growth, we need to encourage manufacturing and attract some big names to Kerala.

Bhuvenendran: As our God’s Own Country is really a gift of God blessed with amazing geography and nature, there is vast potential for tourism, hos-pitality and healthcare. As the income levels are improving and lifestyle is changing there is need for quality helathcare.

Keralites have always been aware of the importance of education but the quality of this education has to be im-proved and there is always potential in this segment.

George Paul: Fields like tourism, hospitality, private healthcare, educa-tion, IT, ITES, processed food industry etc are undoubtedly areas of great po-tential. The responsibility of the Gov-ernment is to create an environment which is conducive by providing the necessary infrastructure and making investor-friendly policies etc. Unfor-tunately we do not even have proper world-class roads except maybe for the stretch from Angamaly to Thris-sur on the National Highway. An im-mediate necessity would be to extend this facility from Thiruvananthapuram to Kasargod on a war footing. Also a clean environment with proper technol-ogy for garbage disposal will have to be evolved by introducing silage tech-nology practised in the western coun-tries. The advantage of this technology is that it does not create any foul odour in the atmosphere.

As an entrepreneur what do you think is your formula for success?

Mithun: I have an amazing team of people working for us who have re-ally driven the V-Guard Group to what it is today. Our success has not been due to any one-man show but due to a concerted team effort working towards a clear vision.

Akshay: It is an open-source for-mula—work relentlessly towards de-livering growth—to your customers, team members and everyone associ-ated with you. It’s something that is printed on every piece of stationery of our company: Dream-Plan-Achieve.

Christo: As an entrepreneur our product segment was totally new. The segment was not there earlier—like in-verters. So, as that segment was just opening up in the market, we were at the starting point. It was also the same with UPS and solar water heaters.

So if anything is invested initially in a growing segment, it will be easy for the organization to grow along with the growth of that particular segment, ie an entrepreneur has to look for a segment which is growing exponentially. Then it will be easy to grow along with the growth of the segment in its expand-ing market. It is like a boat in a river in which our destination is in the direction of its flow.

It will be easy to row the boat with less effort as the flow of the river will help us to reach the destination. Oth-erwise it will be like that same boat in a pond or lake where there is no flow of water. There more effort is needed to row the boat to the destination point. If the selected industry segment is in a saturated market, more effort will be needed to achieve good results.

Another important thing is to give importance to the customer, ie the customer should be benefited by the product which we are making for them to purchase and also we should give proper care in providing after-sales service.

Bhuvenendran: Dedication, sin-cerity, and quality.

George Paul: From day one on-wards keep the trade union activities away from the workplace by complying with all statutory obligations due to the employee. Over and above that, take care of his basic needs in housing and healthcare for the dependants. The investor must evolve a system to op-timize productivity, quality, cost reduc-tion, services and customer relations. That is the way the competitiveness of the product can be assured which en-ables the business to prosper.

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Rani George

Passline News Service

The Department of Tourism of the Kerala Gov-ernment is showcasing projects in the ‘Emerg-

ing Kerala’ meet targeting mainly NRIs and foreign in-vestors. The sea plane project is such an effort where the infrastructure will be provided by the department. “It is an open policy project but it is not open to foreign investors,” says Mrs Rani George, Director, Depart-ment of Tourism. Hotel business is another area where investments are expected.

“We will have a fast-track clearance scheme for anybody with a project of Rs 10 crore,” she says. And if a project is linked with responsible tourism, ie if the project will give benefits to the local community, the department will provide subsidies, she adds.

This time the department is fo-cusing on northern Kerala as it still remains an unexplored geographi-cal area for tourism. More infrastruc-tural development and investments will happen there.

Adventure tourism and water sports are the other areas which it is planning to give thrust to. Activities like paragliding and canoeing are sure to attract tourists. But at pres-ent only a few operators are available for adventure tourism. In view of this situation, a new policy has

been announced to give incentives to the op-erators.

Since the state is blessed with backwa-ters the department is going to tap into water sports. The Na-tional Institute of Wa-ter Sports is entrusted with conducting re-search on the potential

of this area. The study is going on and from next year onwards people can invest, Mrs Rani George says.

Tourism in Kerala has reached its saturation point and the department is planning to tap markets other than the traditional ones like Europe. Print media cam-paigns are going on to popularize Kerala as a destina-tion in new markets like Australia.

The department has already conducted road shows there.

This time the department is focusing on northern Kerala as it still remains an unexplored geographical area for tourism.

More infrastructural development and investments will happen there. Adventure tourism and water sports are the other areas which it is planning to give

thrust to. Activities like paragliding and canoeing are sure to attract tourists. But at present only a few operators are available for adventure tourism.

In view of this situation, a new policy has been announced to give incentives to the operators.

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As a pioneer in promoting Kerala’s tourism along with the Department of Tourism how far has KTDC succeeded in its efforts?

KTDC has been the first mover when it comes to new destination de-velopment and trying out new ideas. It has functioned as the face of Kerala Tourism and most people identify Kera-la’s tourism with KTDC. The brand rec-ognition and value is phenomenal. Its role in getting brand Kerala to where it is now is universally recognized and is a case worth studying in marketing strategies.

How many motels and hotels are there under the management of KTDC and what are the new strategies being adopted to boost the tourism sector in relation to these motels and hotels?

With 72 properties spread across the state catering to all segments, from the very top end to ordinary tourists, KTDC has developed into the biggest hospitality group in Kerala. The mo-tels and wayside amenities cater to ordinary travellers along the highways whereas premi-um properties like Lake Palace, Thekkady, or Tea County, Munnar, cater to the afflu-ent. KTDC would continue to cater to all segments with purposeful focus on diversification into other ac-tivities within the sector. Upgradation and renovation of these properties is on the cards. Business strategization is the mantra.

Ayurveda is now seen as the core element of tourism in Kerala and is one of the sectors that will come under the agenda of the ‘Emerging Kerala’ pro-gramme. How does KTDC provide fa-cilities for ayurvedic tourism?

We had pioneered ayurveda-related tourism way back when it was not even thought of. ‘Age-halt’ is the registered trademark under which KTDC offers ayurvedic services. The Ayur-Village property near Kumarakom would act as a dedicated therapeutic ayurvedic

centre which focuses on hard-core ayurveda that goes beyond a routine spa experience.

How many centres are there un-der KTDC for ayurvedic treatments like panchakarma? Where are they lo-cated? Are treatments confined only to panchakarma or are any other thera-pies provided?

All our premium properties have state-of-the-art ayurvedic facilities pro-vided by experts. We have strategic tie-ups with the best in the industry. KTDC commands legitimate confidence of the customer. We do not and cannot compromise on quality and safety and the health and privacy of the customer. The fact that KTDC is a Government entity brings in confidence and reliabili-ty. This is a crucial factor when it comes to ayurveda where semi-professionals and quacks are not uncommon.

What are the major destinations promoted by KTDC? And what are the new destinations under planning?

Kovalam and Munnar were spear-headed as destinations by KTDC as the first mover. Now both these plac-es have enough private players who also reap the benefit of the success-ful transformation. The houseboats of Alappuzha were also introduced by KTDC. Now we’re focusing on Malabar. Muzhappilangad beach, Kannur, Bekal and Kasargod are being targeted.

What will be KTDC’s contribution to the coming ‘Emerging Kerala’ pro-gramme?

KTDC would be actively participat-ing in making Kerala a hospitable ter-rain for investment and business. PPP projects with thought and precision would surely succeed in Kerala with proper planning and design. We’re ac-tively associated with new plans such as introduction of sea planes etc. Bol-gatty Palace would see a lot of action during the ‘Emerging Kerala’ meet.

When investments come into the state after ‘Emerging Kerala’, how is the state going to benefit as a tourism destination in general and KTDC in particular?

More funds and strategic invest-ment from entrepreneurs would make Kerala a live wire. Tourism is expected to grow phenomenally with increased business and investment. MICE tour-ism would be the direct beneficiary of increased business activity. Invest-ment and introduction of newer tech-nology along with infusion of newer ideas would positively impact the hos-pitality industry.

We need to reinvent ourselves and develop newer products to cater to the business class. This would also mean a gradual shift of emphasis from re-sort-based tourism to business hotels

and a resultant levelling-out and rationalization of investments within the sector. More exposure of Kerala as a destination would also mean that we make realistic sale pitches and claims that we could realistically satisfy.

The challenge would be to raise our standards to meet the demands of higher clientele and also to get trained personnel to handle increased occu-pancy and traffic. More employment opportunities can be easily projected and we need to gear up to the occa-sion.

The role of Kerala Tourism Development Corporation (KTDC), the face of Kerala Tourism, in getting brand Kerala to where it is now is universally recognized and is a case worth studying in marketing strategies. It has 72 properties spread across the

state catering to all segments, from the very top end to ordinary tourists, and has developed into the biggest hospitality group in Kerala. In an email interview to PASSLINE, Mr Prasanth N, KTDC’s young and dynamic Managing Director, who is a 2007 batch IAS officer of the Kerala Cadre, talks of the organization’s activities and plans for diversification. Excerpts:

17


Prasanth N

KTDC will focus on diversification: MD

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1918

Kerala State Cashew Development Corporation

(KSCDC), which maintains the reputation of being a model employer in the state, is now foraying into the international arena with a handsome offer to the foreign investors participating in the ‘Emerging Kerala’ event. Dr K A Retheesh, Managing Director, KSCDC, says foreign investors can become global channel partners for marketing cashew abroad and be part of the corporation’s efforts to become the global market leader in cashew.

“KSCDC can provide a big opportunity to investors in the Emerging Kerala event,” says Retheesh. KSCDC can offer tie-ups with foreign investors to start a global distribution network of cashew in their country or anywhere else, he says. The mission now is to transform cashew into a global brand making KSCDC the global market leader.

KSCDC, a company fully owned by the Government of Kerala, was established in 1969 and started commercial activities in 1971. It utilizes the full potential of cashew which provides employment for 20,000 in more than 30 factories across the state. From a modest beginning in 1969 the corporation has now grown into a large organization playing a pivotal role in the industry in the world.

Earlier several false notions prevailed among the common people preventing them from including cashew in their diet. People generally perceived the nut as an export item or an expensive food consumed by the upper elite class only. Some others cited health reasons like it would increase the cholesterol level. But the situation changed with the rise of the middle-income group which resulted in a drastic change in the lifestyle and eating habits increasing the demand for cashew. Cashew, a tree nut, contains HDL (high-density lipoprotein) and therefore can reduce the LDL (low-density lipoprotein). So, in fact, it is good for health, Retheesh says.

As the myth around the nut has been busted the local market has been strengthened with the mounting demand for the product. Organized retailing has also been helpful for cashew. The domestic players are ready to buy the products upfront for crores of rupees according to the corporation’s demand. A safe domestic market and the status of cashew as a global brand have made the corporation go for value-added products.

The most prestigious value-added product the corporation is about to launch is ‘Chocolate-coated Cashew’. The product is developed after research conducted by CFTRI (Central Food Technological Research Institute). The new product is prepared targeting a global market. Production has reached

the machinery installation stage and will be launched any time soon.

The other value-added products are Cashew Vita, an instant beverage mix suited for all ages; Cashew Soup, a purely vegetarian mix for preparing ‘ready-to-serve’ instant soup; spiced cashew bits; dry roasted cashew bits with chilly and salt coating, ideal as a snack; cashew powder; and plain cashews in powder form made suitable for cooking by blending with cornstarch. “KSCDC is not just focusing on cashew but a basket of products related to cashew, and our products are the best in the international market considering the high standard of quality and reasonable prices,” the Managing Director says.

KSCDC had begun to register good results from 2005-06 and the last financial year witnessed a turnover of about Rs 300 crore. “We are now aiming at a Rs 500-crore turnover, Retheesh says. This is indeed a remarkable change that differentiates the corporation from the previous period. All these developments happened while Retheesh was in charge. Retheesh was able to retain the chair even after the change of

governments because of the way he led the corporation forward in an unprecedented manner and also his interest in cashew.

He has a doctorate in cashew research. This shows his love for cashew and that is why his efforts are becoming successful in transforming the corporation from a model employer to an international player in the market.

At present the major export markets for KSCDC are Europe, the US and the Middle East. KSCDC has a tie-up with Lulu, an international retail chain in Dubai.

A study conducted by the Indian Institute of Foreign Trade (IIFT) has proved that the cashew products of KSCDC are the best in the market matching international standards of quality. Also, the corporation has received many certifications for quality and hygiene.

“The ISO certification is the next big thing that the corporation is going to be recognized with. Its procedures are almost over and we are waiting for an official confirmation,” Retheesh says.

Now the corporation is looking forward to building the brand to enhance its international market presence.

“The Government has allotted Rs 1crore for brand building,” Retheesh says.

KSCDC, a company fully owned by the Govern-ment of Kerala, was established in 1969 and started commercial activities in 1971. It utilizes the full potential of cashew which provides em-ployment for 20,000 in more than 30 factories across the state. From a modest beginning in 1969 the corporation has now grown into a large organization playing a pivotal role in the industry in the world.

Passline News ServiceDr K A Retheesh

1918

KSCDC set to become global

market leader in cashew

1918 1918


‘Emerging Kerala’ is going to be a biennial event just like the ‘INCA’ Expo of the MSMEs jointly organized by DIC and the Kerala State Small Industries Association (KSSIA). It is going to showcase some 175 projects catego-rized under 26 growth areas. Non-gov-ernmental agencies (Infopark, SCMS and the like) also will be presenting their projects to attract interested in-vestors.

It is definitely a laudable venture of the UDF Government, which has appointed the Kerala State Industrial Development Corporation (KSIDC) as the nodal agency to implement the programme. The programme has been in the air for a pretty long time. But it is only now, ie just a week before the

take-off of the event, that the LDF and some other organizations have ‘risen’ with several protests. This leads us to think that there is a political conspira-cy behind it. The Kerala Chamber of Commerce and Industry (KCCI) has come out strongly against such forces undermining our growth prospects. The influence of some vested inter-ests is suspected. Our educated youth want jobs here in their own home state. They should stand united against such anti-developmental forces and help pave the way for opportunities to take shape. KCCI alleges that previous at-tempts like the Global Investor Meet (GIM) and its ‘Focus-Kerala’ failed to take off because of the obstacles cre-ated by such parties or organizations.

There is no doubt that all the promises the Government makes to investors should be transparent. The Government has made it clear that no Government land will be alienated flouting the norms. Clearances of all statutory bodies would be obtained. KSIDC will be the nodal agency to ob-tain such clearances. It is understood that the Government has called the leftist groups for a discussion. Let’s hope that some consensus would be reached on conducting the event un-der a peaceful environment.

One of the mega-projects placed before this grand event is the Kochi Metro Rail. Though there is politi-cal consensus now about the project, it could not set sail even after seven years. Some more anchors are still to be lifted. At a meeting organized by the Kerala Management Association in Kochi recently, Mr E Sreedharan, the ‘Metro Man’, revealed some facts about the project.

The Delhi Metro RailAccording to him, it is not the politi-

cians but the bureaucracy that is caus-ing such inordinate delays in projects.

q The first Metro rail in the coun-try was implemented in Kolkata. It took many years to complete and hence turned out to be a white elephant. The next project was the Delhi Metro, of which Mr Sreedharan was the leader. He could finish it in three years and nine months, ahead of schedule. It had two lines in phase-I having 59 stations over 65 km. Now there are eight more lines in phase-II having 83 stations over 125 km. The project cost of phase-I is stated to be Rs 10,571 crore.q The corporation is running

highly profitably and investments are being made in developing more lines. It is now capable of giving consultancy and also building other metros in the country. (The then Chief Secretary of Delhi said they did not want that ‘white elephant’). Once the Kochi Metro is made operational, it can also gain that expertise to build other metro rails for other cities in Kerala. q The project cost of Kochi Met-

ro was estimated at Rs 3,500 crore in 2005. But now it has escalated to Rs 5,180 crore. Mr Sreedharan said that each day’s delay was costing us Rs 40 lakh. He said that until today the official communication entrusting the contract of Metro Rail has not yet been handed over to DMRC. The work can be awarded to sub-contractors within a week of receipt of the communication to DMRC. q He said that the PPP model is

not workable in the case of social proj-ects like Metro Rail as the profit may be of the order of 3% only, whereas the private investors expect 15%-18% return on their capital. The loan from the Japanese agency is a soft loan. Its interest is only 1.5% with a repay-ment period of 30 years. Out of the 30 years, a moratorium on repayment for 10 years is available. q As of now the project will have

to be subsidized by the Government for some time. The consultants are

finding ways of reducing the operating expenses and increasing the revenue in other ways like advertisements, hir-ing of premises for commercial purpos-es and the like. q Since acquisition is a problem

in highly commercialized areas like M G Road, only trains of 2.7m width are envisaged. The pillars will be placed on the dividers. There will be parking spaces only at Aluva and Petta. Small buses to commute from homes and offices have to be introduced. Cycling has to be made popular by providing safe bicycle tracks. Mainly only Gov-ernment land is utilized. For stations, in some places private property has to be acquired. This may come to about 2.5 ha. q During the construction stage,

the public have to face some inconve-nience; but once the rail is in opera-tion, not much of traffic and parking problems will be there. In Delhi, before the Metro Rail came into operation, business in the underground Palika Bazaar was very low because of park-ing problems in Connaught Place and most of the shops were on the verge of closure. But now they have all got back their lives. q The compartments will be

vibration- and sound-free. They will have to get clearance from the Railway Safety Board. Both stations and com-partments will be designed in such a way that elder citizens and differently challenged people can use them safely and with ease.On the whole this project will change the face of not only Kochi but the state as a whole. The project/s will themselves generate a lot of eco-nomic activity and many direct and in-direct job opportunities. Let us give it the red carpet welcome!

(The writer is a former General Manag-er of Kerala Small Industries Develop-ment Corporation and is presently an industrial consultant based in Kochi)

The Metro Rail in focusG Rama Mohanan Nair

It is only now, ie just a week before the take-

off of the ‘Emerging Kerala’ event, that the LDF and some other organizations have ‘ris-en’ with several protests. This leads us to think that there is a political conspiracy behind it. The Kerala Chamber of Com-merce and Industry (KCCI) has come out strongly against such forces undermining our growth prospects. The influ-ence of some vested interests is suspected. Our educated youth want jobs here in their own home state. They should stand united against such an-ti-developmental forces and help pave the way for oppor-tunities to take shape.

1918


E Sreedharan Sheila Dixit, Delhi CM

20


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Kerala Financial Corporation (KFC), incorporated under the

State Financial Corporations (SFC) Act of 1951, plays a major role in the development and industrialization of Kerala. It was established as the Travancore Cochin Financial Corporation in 1953. Kerala was formed in November 1956 after the reorganization of states on linguistic basis, and the Travancore Cochin Financial Corporation was renamed Kerala Financial Corporation.

KFC today has 16 branch offices with its headquarters at Thiruvananthapuram and zonal offices at Kozhikode, Kochi and Thiruvananthapuram.

The provisions of the SFC Act of 1951 as amended in the year 2000 control and guide the functions of the corporation. The main objective of KFC is the rapid industrialization of the state

by extending financial assistance to micro, small and medium enterprises in the manufacturing and services sectors.

The corporation gives financial assistance for setting up new units and for the expansion, modernization and diversification of existing units in both the manufacturing and service sectors. Since its inception KFC has disbursed over Rs 3,000 crore to more than 40,000 projects across the state.

KFC is growing to be the country’s best SFC (State Financial Corporation), Managing Director Yogesh Gupta says. This status is being achieved by the introduction of norms which have helped to eliminate the misconceptions about the corporation. As a result the top clients have migrated back to KFC, he says. KFC is assigned by the Government with the prestigious programme of Kerala State Self

Entrepreneur Development Mission (KSSEDM).The aim is to develop Kerala into a business state. There are 10,000 projects under KSSEDM out of which 276 will be operational in the beginning, says Mr Yogesh Gupta. KFC will give financial assistance to anyone who comes up with new ideas for an industrial project, he says.

KFC reported a profit of Rs 45crore during the last financial year and non-p e r f o r m i n g assets of 1.3%. It has plans to target a disbursement of Rs 500 crore.

The corporation has achieved a professional scientific method of operation which it lacked earlier. New


KFC—best SFC in the makingThe main objective of KFC is the rapid industrialization of the state by

extending financial assistance to micro, small and medium enterprises in the manufacturing and services sectors. The corporation gives financial assistance

for setting up new units and for the expansion, modernization and diversification of existing units in both the manufacturing and service sectors.

Started in 1991, the Kerala Bu-reau of Industrial Promotion

(K-BIP) is an autonomous body un-der the Department of Industries and Commerce (DIC). K-BIP provides op-erational flexibility and acts as support mechanism for DIC and also functions as an interface between prospective entrepreneurs and several state agen-cies. It interacts between national and international agencies for technology upgradation, technology development and technology management for vari-ous industrial sectors.

K-BIP is associating itself with DIC to provide support for investors to start industries as part of the ‘Emerging Ker-ala’ programme. Considering its limita-tions, it is able to promote only micro and small industries, says Mr V Ra-jagopal, CEO, K-BIP. It takes care of the needs of these investors from the starting stage till the implementation stage. It also gives financial support joining hands with Kerala Financial Corporation (KFC) and banks. And in

most cases K-BIP does not charge any consultation fees from indus-trialists.

K-BIP mainly concentrates on projects of Rs 2 crore and if it ex-ceeds Rs 5 crore it is beyond its capacity, says Mr Ra-jagopal. Such projects will be looked after by DIC itself.

The industrial cluster develop-ment programme under the MSE-CDP scheme of the Union Ministry of MSME (micro, small and medium enterprises) was initiated to overcome the disad-vantages of economies of scale, weak capital base, increased competitive-ness, fast decision-making etc in the MSME sector. The activities of industri-al cluster development throughout the state are being coordinated by K-BIP in association with the Union Ministry

of MSME. K-BIP is promoting industrial clusters in sectors like food process-ing, terra tile, wood, plastic, bamboo and cane, garments etc that have been highlighting the industry-specific needs of the sector. K-BIP so far has commis-sioned seven clusters in various parts of the state and many of them have been inaugurated. They are the rub-ber cluster at Changanassery; plastic cluster, Aluva; terra tile cluster, Thris-sur; plywood cluster, Perumbavoor; Valluvanad wood cluster, Malappuram; Kerala Furniture, Kochi and Kalady; and Rice Millers Consortium, Kalady.

A major programme undertaken by K-BIP is the certification of food pro-cessing and related units. A prime ex-ample of this is the National Centre for HACCP Certification (NCHC), ensur-ing food safety and hygiene through the Audit & Certification of Interna-tional Food Safety (HACCP) system in the food processing sector in line with international standards.

Big brands like Taj Malabar, Abad and Nirapara have been given HAC-CP certification, Mr Rajagopal says. K-BIP also participates in all internation-al food processing shows, and sets up pavilions for Kerala.

K-BIP is on the mission to revitalize the bamboo sector by giving all sup-port to the sector by promoting bam-boo-related events. It provides free stall space for artisans at such events. This year K-BIP provided 150 stalls.

In association with the National Institute of Design K-BIP is providing training for artisans to make a variety of like pens, file folders, curtains and bags. The mural paintings on bamboo is an attractive item, says Mr Rajago-pal. Many NGOS are active in the making of bamboo products, he adds.

The bamboo sector is emerging and K-BIP is trying to deliver all sorts of help like ‘bamboo fests’ where ar-tisans can showcase their products and find market, says Mr Rajagopal. He says bamboo is available in abun-dance in the forest and, in addition, ef-forts are being made to plant the seed-lings in due time so that the ecological balance is not affected.

K-BIP is also in charge of provid-ing transportation facilities for inves-tors who participate in the ‘Emerging Kerala’ event.

Yogesh Gupta

appraisal norms have helped to make it more humane and professional. It has opted for c o m p a s s i o n a t e settlement in many cases reducing the number of cases in the court. KFC had issued bonds and got double the number of subscribers that it expected.

KFC is now concentrating on food processing projects. It has financed for a rice mill at Kalady and food processing centre at Pathanamthitta. “Other areas of interests are diagnostic labs, manufacturing industries and real estate,” says Mr Yogesh Gupta.

It has recently stepped into innovative projects like financing for films. The films are not only restricted to Malayalam; the corporation targets Bollywood also, Mr Yogesh Gupta says. “We will ask Bollywood film-makers to set up studios here and we will finance up to Rs 2 crore,” he adds.

KFC has already started preparations for ‘Emerging Kerala’. A lot of NRKs in the UK are expected to invest in the state. Their investments may fall in hotels, convention centres and hospitals, says the MD.

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K-BIP promotes clusters in many sectors

V Rajagopal

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The state is gearing up for the new wave of IT revolution by showcasing a slew of projects

including, rural IT parks, in Kollam, Alappuzha and Thrissur districts, at the ‘Emerging Kerala Global Connect’, says Mr P H Kurian, Principal Secretary, IT, Government of Kerala.

“Kerala is going to be the ideal platform to ex-periment this third wave of IT revolution in the coun-try,” Mr Kurian says. “The first wave was confined to big metros like Bangalore and Hyderabad, while the second was expanded to smaller cities like Kochi and Pune. Apart from the connectivity, the skilled manpow-er and better logistics in smaller Kerala towns can set the pace for the new wave of IT revolution.”

New IT parks have been pro-posed at Kundara on the banks of the Ashtamudi Kayal east of Kollam district, Pallip-puram near Cherthala, Alappuzha, 25 km southeast of Kochi, and Koratty in Thrissur district by the side of the National Highway and 12 km from Kochi Interna-tional Airport.

The state will also propose, at the meet, a project to build a residential complex worth Rs 14 crore to house IT professionals at Kozhikode, an ideal tier-2 city for IT and ITES business. There are 40 IT companies in that city, and the project envisages the de-velopment of an apartment building for leasing.Kerala will also scout for partners to further develop the next stages of Infopark at Kochi and Technocity (phase-IV of Technopark, Thiruvanan-thapuram), says Mr Kurian.

Kerala ready for third wave of

IT revolution

P H Kurian

K G Girish Babu

In an interview with PASSLINE, Mr K G Girish Babu, Chief Executive Officer of Technopark,

Thiruvananthapuram, discusses the development programmes of the organization and its future fo-cus. Excerpts:

Technopark is the face of IT and ITES as far as Kerala is concerned and the Government has identified these sectors as the prime area meant for investments in view of the Èmerging Kerala’ programme. How far is Technopark tuned for the event?

Technopark, Infopark and Cyberpark, along with KSITIL (Kerala State IT Infrastructure Ltd), together have identified 50 projects in IT infra-structure in nine different locations in Kerala. The project profiles for these specific proposals have been worked out in detail and the profiles of these projects have been uploaded on the ‘Emerging Kerala’ website. These profiles include investment opportunities in Technopark phase 3, and Tech-nocity, Thiruvananthapuram.

As a new benchmark for the next-generation IT revolution, the Government is focusing on ru-ral and semi-urban areas as IT destinations. What are the plans of Technopark to cope with the situ-ation?

Technopark has set up a park at Kundara (Kollam district) and it will get ready within five to six months. Following the same model, Infopark has set up parks at Cherthala and Koratty.

KSITIL is planning to set up parks at Kasar-god and Kannur. However, the business build-up in these semi-urban and rural locations is ap-pearing to be at a slower pace than expected. Once the hubs (Thiruvananthapuram, Kochi and Kozhikode) grow beyond a level, the semi-urban areas will pick up.

According to you, what impact will events like ‘Emerging Kerala’ make on Kerala’s IT sector?

‘Emerging Kerala’ gives an excellent focus to the state as an investment-friendly destination. The initial discussions we had at various road shows indicate that the proposals are more seri-ous in nature than at earlier business meets. In-vestors have started looking at Kerala as a serious and safe destination for their investment.

Players in the sector are saying that the advan-tages of cost-effectiveness in Kerala are history now in all aspects, particularly in salaries and rent-als. What do you say?

Cost-effectiveness does not come from salary or rental. Rental will be comparable everywhere in the country because of the comparable cost of building the infrastructure. Rent for space forms only less than 10% of a company’s revenue out-flow and hence that alone shall not be taken for comparison.

The savings in cost of operation are the unique feature in Kerala. Availability of power from the grid for more than 95% of the time itself makes Kerala much economical in operation. The revised LT4 tariff is only Rs 4.25 a unit and the IT parks in Kerala provide more than 95% power at this tariff. In places like Bangalore, most of the time (as high as 65% to 80% in certain locations) they are on DG set power, costing Rs 18 a unit.

This single aspect makes Kerala a lot more economical. Less cost of living results in a bet-ter saving for all the employees resulting in much higher satisfaction levels for comparable salaries. Another aspect is low attrition levels (less than 5%) compared to 12% to 20% in tier 1 cities out-side Kerala. Undoubtedly, Kerala will have a mini-mum of 30% lower operating costs than in other locations.

Statistics say that the total export revenue from IT is Rs 3,500 crore. Out of this how much is Tech-nopark’s contribution?

Technopark’s contribution is approximately Rs 2,700 crore.

As an expert, what are your expectations for the industry from the forthcoming IT policy?

The forthcoming IT policy will bring in defini-tiveness and more clarity to the investors. It is also expected to give focus to certain identified areas in technology. It will also give thrust to develop-ment of ideas and innovations which will give a boost to young entrepreneurship.

‘New IT policy will give more clarity to investors’

21


22


Passline News Service Close on the heels of the Doha International Center for inter-Faith Dialogue (DICID)

award, another prestigious award has gone to C K Menon, the prominent non-resident Kerala industrialist of Qatar—the prestigious P V Sami Memorial Industrial and Socio-Cultural Award. Instituted by the PVS Group in memory of the great business doyen, the late P V Sami, the award was presented to Menon by Chief Minister Oommen Chandy in Kozhikode on September 1. The eminent personalities who have bagged the award in previous years are Captain C P Krish-nan Nair, M A Yusaffali, Rajeev Chandrasekhar, Dr B Ravipilla, P N C Nenon, M P Ramachan-dran and Galfar Mohammed Ali.

Earlier during the award-presentation func-tion, Mr M K Raghavan, MP, draped a ponnada on Menon. Mayor A K Premajam presented a citation and Mr P V Gangadharan garlanded the award winner. Union Minister for Overseas Indian Affairs Vayalar Ravi presided over the function and Mr A Pradeep Kumar, MLA, DCC President K C Abu, District Collector K V Mohan Kumar, Mr P V Chandran and Mr Rajiv Menon and others attended it.

A seminar on ‘Kerala—Investor-friendly Destina-tion: Prospects and Challenges’ was held after the award presentation ceremony.

Menon was recently honoured by DICID for his outstanding contributions to the promotion of religious harmony in his native state. What makes the DICID honour unique and relevant is that no Indian or other expatriate in Qatar so far has received such recognition from any such

recognized and respectable organization as this institute.

Menon is the Managing Director and Chief Ex-ecutive Officer of the Behzad Group of Compa-nies with headquarters in Doha, Qatar. When he joined Behzad Transports, the company had owned a fleet of 450 lorries of which 200, along with their drivers, were remaining idle because, he soon found, they needed minor repairs. It was here that he put to good effect his knowledge of vehicles and also his intelligence by suggesting that either the company sell all the 200 unused ones or at least demolish 50 of them and use their parts to repair the other 150. The owner chose the latter suggestion and, to his great surprise and satisfaction, the 150 vehicles which were repaired were soon back on the road and the company back on profit.

After a few years with the company, its owner, Ali Hussein Behzad, wanted to sell it and asked Menon if he was interested in buying it. He was of course interested but had no money to pay. The owner consented to being paid in instal-ments as he had by now cultivated great trust in Menon.

Retaining the name Behzad (meaning ‘money’) Menon began to build the company. Although he seemingly found his niche, it took a keen market-ing sense to expand it so successfully as Menon did. He methodically started adding to his fleet, the company’s focus being on fuel transportation by land and sea.

Menon has also entered the steel manufacturing sector. Today he has built his group into a

2322

A philanthropist to the core, C K Menon earmarks 2.5% of the net profit of his companies for ‘sakkat’ (help or money given to poor people). He has built houses for slum-dwellers and the poor, and is the patron of ‘Adarsh’, the charitable institu-tion dedicated to the rehabilitation of chil-dren having symptoms of cerebral palsy and other such childhood development disorders. He is a role model for commu-nal harmony—he has built for his Muslim brethren a masjid at Nocholi in Kozhikode district. He has also erected a life-size statue in memory of Sister Alfonsa, the first Catholic saint from India, at Changa-nassery. Besides, he was deeply involved in the establishment of the School of Bhagavat Gita at Thiruvananthapuram. In 2009 the Government of India bestowed on him Padma Shri in recognition of his charitable and social activities.


23


Rs 4,000-crore-a-year conglomerate, his commercial involvement stretching from Qatar to the UAE, Kuwait, Saudi Arabia, Sudan, South America, the US and the UK. The group employs 2,000 people, almost 95% of them Keralites, and the rest mainly Sri Lankans and Nepalese. His keen marketing sense, busi-ness acumen and ingenuity were evident in his 1994 takeover of a loss-making bakery, Oriental, in Doha. It was of 40 years’ standing employing 400 people and working 24 hours a day. It is now the biggest of its kind in Qatar.

His wife Jaya (Jayasree Menon) is his con-stant companion and support. Menon has three children—two daughters and a son. Anjana and Sreeranjini, the daughters, are married to doctors. The husband of the elder one now looks after the group’s steel fabricat-ing unit in Sudan. Jayakrishnan is the son with engineering education in the UK and involved in Menon’s business.

A philanthropist who believes that charity is not being merciful to the less fortunate, but is their right, Menon earmarks 2.5% of the net profit of his companies for ‘sakkat’ (help or money given to poor people). He built and handed over 100 houses to the slum-dwellers of his birthplace Thrissur some time ago. He has played a major role in constructing houses in the ‘Laksham Veedu’ (onelakh houses) Colony at Puthupally and the M N ‘Laksham Veedu’ restoration project announced by the Government of Kerala. Menon is the patron of ‘Adarsh’, a model institution that epitomizes compassion and love. Children from various religions are studying at this charitable venture functioning at Thrippunithura, Kochi. ‘Adarsh’ is dedicated to the rehabilitation of children having symptoms of cerebral palsy and other motor-sensory childhood development disor-ders like autism, on purely charitable basis. That he is a role model for communal harmony is evidenced by some of his deeds. The most striking of these is the masjid he has built for his Muslim brethren at Nocholi in Kozhikode district, where 400 people can offer prayers at a time. It could very well be the first time after Cheraman Perumal in the late eighth century that a Hindu believer was getting a masjid built.

Menon has also erected a life-size statue in memory of Sister Alfonsa, the first Catholic saint from India, at the new bypass junction in Changanassery. Besides, he is deeply involved in the establishment of the School of Bhagavat Gita at Thiruvananthapuram.

Numerous awards and positions have come his way for his contributions to society. In 2009 the Government of India bestowed on him the country’s highest civilian title Padma Shri in recognition of his charitable and social activi-ties. In 2006 he had won the Pravasi Bharatiya Samman of the Union Government. He has also an Honorary Membership of Rotarian conferred on him. Menon is a Director of the Kerala Government’s expatriates’welfare association, NORKA-ROOTS, and a Direc-tor of Infrastructure Kerala Ltd (INKEL), set up by the Kerala Government in 2007 for the development of infrastructure in the state. The Ministry of Overseas Indian Affairs has nomi-nated Menon as a member of the Board of

Trustees of the India Development Foundation on a directive from Prime Minister Manmohan Singh. The foundation is a non-profitable trust to channelize philanthropic activities by over-seas Indians. He is also a Director of Jai Hind TV and Symphony TV in addition to his direc-torship of a number of educational institutions in Kerala and outside. A notable recognition is his nomination as Vice-Chairman of Al Ba-rakah Financial Services Limited, a joint-ven-ture financial institution formed by the Kerala Government with private-sector participation.

Despite being a ‘world citizen’—he holds visas for the UAE, the US, the UK, Kuwait and Saudi Arabia, besides Qatar—Menon is essentially an out-and-out Keralite, rooted to the state’s soil. Another of his projects for the state is a Rs 250-crore five-star hotel, coming up at Edappally bypass, Kochi. This remark-able man, perhaps, owns the largest chain of companies among Keralite entrepreneurs.

Apart from these he holds many positions in public like member of the Board of Trustees for India Development Foundation (IDF), governed by the Ministry of Overseas Indian Affairs; Director of Modern Indian School (a Delhi public school), Doha; Chairman, Bha-van’s Public School, Doha; Director, Guru-kul School, Thiruvananthapuram; Founder Partner, Sree Narayana Educational Trust School, Thrissur; Founder Member, Adi San-kara Charitable Trust, Thrissur; and Director, Symphony TV, Thiruvananthapuram.

Socio-cultural activities: Patron, Thrissur Jilla Souhreda Vedi, Doha, affiliated to the Indian Embassy; Patron, Qatar Malayali Samajam, Doha, affiliated to the Indian Embassy; Patron, Kerala Socio-Cultural Association, Doha; Patron, ‘INCAS’, Doha, affiliated to the Indian Embassy; Life Member, Indian Cultural Cen-tre, Doha (under the Indian Embassy); and Life Member, Indian Community Benevolent Fund, Doha (under the Indian Embassy).

The following are C K Menon’s companies: Behzad Transports, Doha; Oriental Bakery, Doha; Behzad Information Technology; Dubai; Behzad Fuels UK Ltd; United Kingdom; Sowparnika Group, Kochi; Ali Bin Naser Al Misnad Transport & Trdg W L L, Doha; Behzad International Transport Co, Kuwait; Behzad Petroleum Services Est, Jubail KSA; Behzad Steel & Engg Ltd, Sudan; Behzad Transport, Kochi; Ali Bin Naser Al Misnad Steel, Kochi.

2322

Menon receiving the P V Sami Award from Chief Minister Oommen Chandy

Menon with Prime Minister Manmohan Singh, Overseas Affairs Minister Vayalar Ravi and EMKE Group of

Companies MD MA Yousaf Ali

Menon receiving the Padmashri title from former President Pratibha Patil

CK MenonJayasree


2524


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Tourism is now a flourish-ing sector of the country’s economy in general and of

Kerala in particular. In the past, only a few pockets of the country were known and recognized as tourist des-tinations in India—the Kashmir Valley, royal palaces in Rajasthan, historical monuments like the Taj Mahal and Agra Fort in Uttar Pradesh and so on. Over the years the interests of the people have grown beyond these limited locales. Earlier only Europeans and Americans travelled around the globe for exploring places of interest from the tourism point of view. These foreigners, affluent in terms of money and social status, ventured into globe-trotting in search of new experiences, adventures and leisure.

The quest for exploration of new and unknown places is inherent in westerners, and history tells us that they could reach and conquer even remotest places in Asia and Africa by following this pursuit. Today many of them find the time and resources seeking relief from their busy profes-sional life and travel to different places every year. In Europe and America, people venture out during weekends to spend a couple of days along sea-shores and in hilly towns to unwind and release their professional tensions, sometimes in caravans which can be converted into temporary homes. Dur-ing longer holidays, they visit other countries and explore the life, places and people there.

When the traditional tourist des-tinations got saturated and lost their sheen, new locations were discov-ered. Tourists’ interests craved

for new pastures and pure, unex-ploited natural beauty became a craze among nature lovers. In India, initiatives both at Government and private entrepreneurs’ levels bore fruit in finding and developing new, virgin tourist destinations in various parts of the country. Instead of living in posh hotel rooms fitted with luxurious facili-ties, nature lovers among the tourists preferred to live in peaceful places endowed with natural beauty. Natural life which is more found in rural areas became a fad with tourists all over the world. Infrastructural facilities suiting their needs at affordable costs were created. This changed tastes of tour-ists provided an impetus to the tourism sector in India.

While India’s natural beauty and historical monuments continue to at-tract visitors into our country, a re-verse trend is also becoming preva-lent among our countrymen, leading to their desire to explore foreign coun-tries as tourists. Earlier our country-men travelled abroad mainly for three purposes— higher education, employ-ment and business. With the develop-ment of hospitality and communication, including transport, particularly trig-gered by the financial-sector reforms triggered in the early 1990s, and still continuing, the opportunities for such adventures grew slowly and steadily. The liberalization and globalization processes opened new avenues for Indians as well. Air journeys became relatively cheap and restrictions on vi-sas and other aspects were relaxed. All countries in the world are now

accessible, at least to tourists, and tourism is recognized as a sun-rise industry the world over. Financial affluence also became a significant factor, with the increase in employ-ment as well as business opportuni-ties. The income of the people also steadily increased enabling people to earmark some money for leisure and earning mental satisfaction. Flaunting the new-found wealth became a habit among some sections of society and narrating new experiences in travel-ling and exploring places abroad as also within the country enhanced their social status and respectability.

Facilitation has its own important place in promoting tourism. Those who wish to travel to other places, be it abroad or within the country, encounter many problems in fulfilling their long-cherished desires. Travel-ling alone, even with family, is not al-ways an easy proposition because of infinite uncertainties and problems on landing in a hitherto-unknown place. Tourists need safe, affordable ac-commodation and transportation and hygienic food, to name a few. Lack of adequate knowledge about the places of tourist interest is another constraint. However guidance on these aspects is now, to some extent, available through the internet and websites. Still a lot of time, efforts and money might be spent, sometimes even wasted, in travelling alone and visit-ing places. These hazards

Many hazards during tours can, to a great extent, be minimized by employing the services of tour opera-tors, whose tribe is increas-ing in our country, more so in Kerala. This author has the experience of utilizing the services of three differ-ent tour operators during recent years and, therefore, can vouch for their general efficacy. These tour opera-tors certainly help tourists in economizing on the expenses of such trips by cashing in on the offers for group travelling by airlines, bulk booking by hotels and negotiating with restaurants to cut the cost of food to affordable levels.

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can be minimized by employing the services of tour operators, whose tribe is increasing in our country, more so in Kerala. This author has the experience of utilizing the services of three differ-ent tour operators during recent years and, therefore, can vouch for their general efficacy. These tour operators certainly help tourists in economizing on the expenses of such trips by cash-ing in on the offers for group travelling by airlines, bulk booking by hotels and negotiating with restaurants to cut the cost of food to affordable levels. For groups, airlines and hotels offer con-siderable discounts and restaurants too have attractive packages. The dis-counts and concessions are not nor-mally available to individual tourists. Since these operators have constant rapport with airlines, hotels and res-taurants, a lot of flexibility is allowed and this helps in sorting out many problems while travelling. Incidentally, such cost-cutting also helps the tour operators in enhancing their margins.

This author has found, during his trips facilitated by different tour opera-tors, that they generally take good care of the group members and the tour manager with every group is literally a good friend, philosopher and guide. He often serves as a trouble-shooter and tries to solve the problems of in-dividual members making the trip a memorable one. Usually the job of the tour manager is made easier with the services of local guides who are well conversant with the local situation and can provide proper guidance and right information to the group.

During my trip to Europe, such ser-vices of guides were procured in Paris and London. In Malaysia and Singa-pore also, local guides were engaged to take the group to different destina-tions at appointed dates and times, ensuring maximum satisfaction. Dur-

ing my trips to Dubai, however, the tour manager’s inexperience and ig-norance deprived many single male group members of entry into the Dubai Shopping Festival venue. We reached there on a Tuesday, but all Tuesdays were family days for the festival: only families were allowed entry on that day. Barring such slips, my trips as a member of groups organized by the tour operators were relatively hassle-free.

I distinctly remember an instance when the resourcefulness of the tour manager (of Thomas Cook) helped the group to tack-le a ticklish prob-lem in England in 2006. When our group reached the famous Swa-minarayan Tem-ple in London, a function attended by the then Brit-ish Prime Minister Tony Blair was going on there. We were told that till the function was over and the Prime Minister departed, visit to the temple was not possible. Many members of the group, particularly those who were religious, were disappointed at not being able to have darshan of the deity there. How-ever, the tour manager who had some contact there managed the matter in our favour. On his giving an assurance that the group members would not go near the venue of the function, we were all allowed entry there.

The visit had to be hurried up as we had to come out of the premises before the Prime Minister came out af-ter the function. There was, however, a bonus—sitting in our coach in the

adjoining compound, we could have a ‘darshan’ of Tony Blair from a short distance.

Scores of travel agencies are coming out with large numbers of seemingly attractive tour packages which they advertise in the media. While choosing the right package, the various compo-nents included in the package should be thoroughly and minutely examined. Some packages include only the trav-elling and accommodation expenses, meaning that for food, one has to fend

for oneself. Re-member, food is generally costly abroad, particu-larly in western countries. Finding the right food at affordable rates would not be easy. The time spent in searching for res-taurants suiting our pockets might cost us our time for sight-seeing, the main purpose of the visit. ‘A la carte’ food in res-

taurants would cost us heavily. A pre-determined menu arranged by the tour operators would be advisable. Some operators offer only breakfast: re-member, in all good hotels, breakfast is complimentary with accommoda-tion. An all-inclusive package would prove advantageous to tourists. Most of our tour operators take the groups to Indian restaurants, wherever avail-able, for food. Although variety in food might be denied, the risk of consuming strange food can be eliminated.

On the flip side, being part of a group under care of tour operators has some disadvantages too.

The group mem-bers cannot go beyond and outside the pre-fixed itinerary. Some-times even if we want to spend a little more time at a particular spot, we have to forget such desires because of con-straints of time. The tours can be very hectic commencing in early morning and stretching into late nights as the maximum number of tourist spots have to be covered within the limited time available. The group members would have to strictly stick to the schedule fixed for each place. Normally, for tours abroad, journeys from India and back will be during nights—there is a tendency to minimize the number of days, as this strategy will help reduce the hotel accommodation expenses for the operators. Further, on the first day, even if we reach the destination early in the morning, checking into the hotels will be delayed till noon, again with the above motive. On the last day too, al-though the air journey begins late at night, checking-out will be advanced to the morning, arranging some sight-seeing or shopping opportunity during the whole day. On the whole, the tour operators as a class render yeoman service to the cause of tourism and the tourists are immensely benefited through this. More than the money spent, the convenience factor is what matters to the tourists. People do not mind spending money on fulfilling their desires; they seek value for money. For the consumers’ expectations, the sky is the limit—facilitation helps a lot in satisfying their needs. In the tourism sector, the tour operators are proving to be catalysts and, though there is al-ways scope for improvement, their ef-forts deserve acknowledgement and recognition.

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Kerala at the crossroads: hope versus hopelessness

K PJoseph Kalarickal

Auto drivers, car drivers and maid servants have never had it so good in Kerala. Our maidservant sends her children to English-medium

schools. Her wages are by the hour (Rs 100) and she works hard and earns around Rs 1,000 a day. Our security guards have their sons/daughters in colleges for graduation and postgraduate

studies in engineering and computer courses.

Kerala is strong, because it is built on the rock of hu-man development, inclusive

growth, inclusive healthcare and inclu-sive education. It can overcome pass-ing misfortunes and march forward to a better, truly better tomorrow. Yes, a better tomorrow for all of us is within our power. Let us grab it and march forward and upward with confidence, with hope in our heart!

There are politicians who shout that Kerala is going to the dogs!

There are religious leaders who mourn that spirituality and morality are on the decline in Kerala to a level it had never declined in its long history.

There are trade union leaders who complain that the share of workers in emerging Kerala is on the decline.

There are soothsayers who say that Kerala is afflicted by inscrutable problems of social upheaval.

There are guardians of Malayalee culture who bemoan that Kerala is wobbled up by Western culture.

There are the environmentalists who wail that Kerala is being chewed up by land mafias.But Kerala will march forward despite the problems heaped over it:

Because it owns a society built on the rock of human development: hu-man development through universal education and universal healthcare. Kerala will march forward to higher and higher standards of living despite all its problems.

Kerala will grow despite power shortage, consumer price index growth, skyrocketing retail prices of essential commodities, murderous politics, job-seekers’ increase in employment ex-changes, insufficient skill creation, rev-enue deficit, ‘decline in profit’ cry by the corporate sector, decline in share of agriculture, drop in cultivation of rice, the staple diet of people. For the pov-erty ratio of Kerala is 7.50%, the lowest in the country, half that of even the de-

veloped US (15%) and fast-developing China (15%).

Kudumba Shree, a great enterprise that lifts women at grassroots level, operates in almost all the 978 grama panchayats, 60 municipalities and five corporations that make the megalopo-lis Kerala.

Kudumba Shree promotes poor women to have a better standard of liv-

ing by starting micro-enterprises. They form neighbourhood groups and area development societies and contribute to their individual and social advance-ment.

Hunger has been abolished in Ker-ala because of the ‘rice-at-Re-1-a-kg’ policy implemented through the ration shop network. But in urban areas even autorickshaw drivers and maid ser-vants forgo the Re 1 ration and go for biriyani rice at Rs 27 a kg because of the higher income they earn. Maid ser-vants charging Rs100 an hour in flats housed in multistoreyed buildings and sending their wards to English-medium schools are becoming more. Autorick-shaw drivers owning the vehicle earn almost Rs 1,000 a day.

I remember that when I was young, most of our neighbours were poor and coming to our house for rice water to pacify hunger. It is from this stage of ut-ter poverty and hunger that Kerala has become a hungerless food-filled state.

Never before has a hunger-free Kerala emerged despite the fact that the rice, wheat and vegetables we eat come from outside Kerala. Kerala has the lowest birthrate of 14.6% against

the nation’s 22.8%. Its death rate is 6.6% against India’s 7.7% and sex ratio is 1,084 women per 1,000 men whereas the ratio for the country is 950 women for 1,000 men because of prevalence of female foeticide and in-fanticide.

Many who cry over positive factors such as the decline of cultivated area of rice or because of lower production of rice, forget the fact that Kerala is in a big way into cash crops and modern agricultural practices as never before, increasing income generation in the growth path of economic advancement in the global village.

The building boom that many say will destroy the environment will on the other hand create assets that will

fill the gaps in human habitation in the megalopolis that Kerala is. Kerala is to be compared to Mumbai and Delhi, Kolkata and Chennai, and not to other places especially those in the cow belt, ie UP, Bihar and West Bengal.

New airports (like Aranmula ), op-posed by some politicians because that will turn agricultural land into the hands of the land mafia, will truly make the area prosperous provided the land acquired for the airport is compensated for well so that the displaced families have greater assets and more income. As in the Cochin Airport many will get jobs which they had dreamed of in their lives.

New broader highways connect-ing the north with the south opposed by many saying that it will harm agri-cultural land and create environmental havoc do not know the value and role of transportation infrastructure in eco-nomic growth.

Metro rails are opposed because they will reduce use of taxis and au-torickshaws and will affect the income of those employed in plying them. But metro rails with fast and safe transport will reduce overcrowding and traffic jams and accidents.

Those who oppose black beach sand sale fail to realize that if the in-come from the deals is used to upgrade the living standards of the poor, the bottom 7.5%, human development in the area with surge ahead. The agita-tion should be for proper poor-focused use of income rather than against sale proposals.

Auto drivers, car drivers and maid servants have never had it so good in Kerala. Our maidservant sends her children to English-medium schools. Her wages are by the hour (Rs 100) and she works hard and earns around Rs 1,000 a day. Our security guards have their sons/daughters in colleges for graduation and postgraduate stud-ies in engineering and computer cours-es.

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Kerala is in the historic stage in which Great Brit-ain was when it came as traders and acquired an empire. Because of educa-tion, the greatest empower-ment of the poor, Keralites cannot do low-level manual work which is also a good sign. For manual work, men and families from the cow-belt states are pouring

in, for whom Kerala is the Gulf.

That is the reason why Keralites are spread out all over the world seeking better-paid jobs and have risen to responsible positions because of sheer mer-it. But do not think that it will take another century for the poor Keralites to become rich. Technology has explosive growth which will compress the historic time of transition and the really talented person de-spite his/her poor family background will emerge as the victor.

Concentrating on higher and higher education, skill formation, migration and immigration, Kerala can be the model human megalopolis habitat for all India to catch up with. And despite being born in Kerala or born of Kerala parents we are Indians first and In-dians last. We are not inferior to anyone else in the global village and while growing ourselves prosper-ous we want to help others behind us to catch up with

us. There are many more Shashi Tharoors, Captain Lakshmis, NASA scientists, Rasul Pookkuttys, M V Devans, K J Yesudas’s, HormisTharakans, Ambas-sador Fabians, Nirupama Raos, George Sudhar-sans, Kochousephs, Sebastian Edathis’s (German Parliament member), Jose Daniels (Canadian Par-liament member), Joy Cherians (US Minister, retd), Anita Nairs (writer), Arundhati Roys,Vayalar Ravis , A K Antonys, Prakash Karats,. T J S Georges, Paul Zachariahs, Archbishop Bharanikulangaras, Jerry Kalarickals (US Foriegn Service), M T Vasudevan Nairs, E Sreedharans (metro maker), Shishir Kurups (Hollywood ), Anupa Fabians (New York NGO lead-er) and so on and on waiting in the womb of time to take the world by storm .

This is only because the inclusive growth princi-ple, leaving aside no one—poor, tribal, untouchable, differently abled—, is followed in Kerala.

(Remember the Pizhala miracle artist, the son of a worker, who cannot walk, only crawl, conducting exhibitions of his paintings in Kochi).

Inclusive means all-inclusive, leaving out no one in society, giving care to every child to grow up into its full potential, which is the secret of growth, of prosperity, of life. A few suggestions: Let tourism and ayurveda continue to be the channels of enterprise rooted in Kerala, but spreading out globally. Avoid hartals, or at least alter their destructive face. Cannot

hartals be held for 6 hours/4 hours as in Left-ruled Italy? The point can be made with greater force.

Institute ‘Kerala Government Pioneer’ awards and let a hundred NRI Keralites be presented with awards every year on Kerala Day. This will promote NRI investment more than what the Government can manage. (Venu Rajamani, the illustrious son of Kerala, has brought investment to Kerala, according to news. We can think of giving an award to him).

The T P Chandrasekharan murder has created an unexpected result. The parties of the Left and the non-Left (in Kerala there are no rightist parties, all parties support measures that will lift the common man) want nonviolent inclusive policies of growth. This is the opportune moment to forget the violent past, to bury mutual accusations and promote a brand new form of politics of non-violence and trans-parency.

As said in the beginning of this article, Kerala is strong, because it is built on the rock of human development, inclusive growth, inclusive healthcare and inclusive education. It can overcome passing misfortunes and march forward to a Better, Truly Better Tomorrow .Yes, A Better Tomorrow For All Of Us Is With In Our Power. Let Us Grab It And March Forward And Upward With Confidence, With Hope In Our Heart!

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It is very good to hear about the Kerala Government’s plans to

launch the ‘Emerging Kerala’ pro-gramme in order to attract large-scale investments into the state. One must compliment the Government on its ini-tiative. The biggest plus of such an ini-tiative is the visibility that it can give to the state and the impression that it will create in the minds of potential inves-tors located all over the world about the state. To be seen in the radar of inves-tors, the state needs to continuously make noise. ‘Emerging Kerala’ must be a programme and not an event. The programme must run longitudi-nally; at least during the tenure of the present Government.

The worry is when the changing governments in the state are trying to undo each other’s policies and programmes during the al-ternate tenure, the lack of continuity and the resultant non-commitment from the part of successive gov-ernments on matters of industrialization and in-vestment standout as a scare- crow. A similar initiative by the UDF Government in its last tenure, ‘Global In-vestor Meet’ (GIM), which, though was announced with a big bang, whim-pered away later. That should stand in good stead as learning in the con-duct of the new ‘Emerging Kerala’ programme.

At the outset, it would be better if

the UDF Government takes a clear view of the investment model that it wants to have in Kerala. During the last LDF regime, we had seen that the focus of the policymakers was heavily tilted in favour of investing in public-

sector undertakings and it went about rejuvenating those semi-dead and ICU-based PSUs of the State Govern-ment. Industry majors in the defence sector located outside the state, like HAL and BEML, were roped in to join up with local PSUs in setting up their manufacturing activities here. Another example is the coach factory at Kan-jikode, Palakkad. Now that the UDF is in power, does it want to continue the policy of industrializing Kerala through the PSUs or does it want private in-vestment to come in? No specific poli-cy guidelines are heard from the pres-ent Government in this regard. Setting foot in two boats simultaneously to go forward will only lead to mishaps and, definitely, will not result in progress.

However, if one has to read from the ‘Emerging Kerala’ plans, one will realize that through this the Govern-ment will want to have large private investments to come into Kerala. But what model is this? Is it the public-

private partnership (PPP) model or is it purely private play? Huge projects such as the Metro Rail, high-speed rail infrastructure etc are conceived as governmental or Government-con-trolled projects only. Infrastructure is probably an area where the PPP mod-el is being sought. Kerala totally lacks good infrastructure within.

I am not speaking about the need for roads and bridges alone, I am also speaking about ports, transportation (road, rail and water), solid waste management, industrial centres, logis-tic parks, shopping and entertainment infrastructure etc.

Going through the KSIDC docu-ment on ‘Emerging Kerala’, one feels that the state has identified the core areas in the state which need invest-ment. Which are the industries for which Kerala has an ideal ecosystem? Predominantly, it is in the tertiary area of services. In this, tourism, IT/ITES, banking and finance services (par-ticularly non-banking finance compa-nies—NBFCs), healthcare, construc-tion etc come to the forefront.

What about manufacturing? Large-scale manufacturing is still a no-no for Kerala. If it is manufacturing, it has to be in the SME sector, that too predom-inantly in the area of food processing, ayurveda products, paint, seafood and rubber-based industries such as foot-wear and related things.

For a state whose laity is focused on white-collar employment, the ter-tiary sector gives them more hope. Looking at the shortage of local man-power in the constructions industry for semi-skilled and unskilled labour, it is not sure how manual labour-based in-dustries in Kerala will thrive.

Going through the KSIDC document on ‘Emerging Kerala’, one feels that the state has identified the core areas in the state which need

investment. Which are the industries for which Kerala has an ideal ecosystem? Predominantly, it is in the tertiary area of services. In this, tourism, IT/ITES, banking

and finance services (particularly non-banking finance companies—NBFCs), healthcare, construction etc come to the forefront. What about manufacturing? Large-scale

manufacturing is still a no-no for Kerala. If it is manufacturing, it has to be in the SME sector, that too predominantly in the area of food processing,

ayurveda products, paint, seafood and rubber-based industries such as footwear and related things. S R Nair

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What are the elements that can help ‘Emerging Kerala’ succeed?

A well-known senior businessman recently said from his experience that when the then Government wanted the BMW to invest in Kerala, the company did not do so because the opinion of industrialists and businessmen inside Kerala did not encourage them to set foot here. Of course, there is truth in it. If anyone wants to invest in Kerala, what he does first is talking to the local industry community and not to a Minis-ter or bureaucrat.

This home truth is always forgot-ten by people in power (both the ex-ecutives and the bureaucrats). If any big-ticket investment has to happen in Kerala, it must involve the local indus-try fraternity. One sees a change in this trend and hears that decision-makers are consulting the local business fra-ternity and trade and commerce bod-ies that they belong to. It is a welcome mindset change on the part of our leaders. Please continue to involve the local players and the trade bodies in the process of bringing in major invest-ment into the state.

One major impediment that we need to be concerned about is whether our state has enough resource band-width in the Government to manage

the large investments that come in here. When I say resource bandwidth, I would like to include the personnel in industries and related departments, their behaviour and their approach and attitude towards the investors. I also in-clude the systems and the processes to give clearance and to monitor these investments.

These resources need to be very proactive in their approach and man-agement. I do not think that such a resource system exists in the Govern-ment. What we have here is a system based on the messy red tape of both the executive and the bureaucracy, which will never help in matters relat-ed to large-scale investments that we want to welcome in the state.

While huge investments are want-ed here, which may happen in the PPP model, what we need to be al-ways looking out for is the genesis and existence of adequate small and medium enterprises (SMEs) within the state. SMEs play a major role in the economy of the country either in terms of products/services or in terms of em-ployment generation capacity. Under all circumstances we must preserve and grow them. These SMEs also will become the back-up in the event of recession or calamities affecting huge industrial segments.

A strong economy, like that of Germany, has always ensured the existence of very strong SMEs inside their system as the buffer, and taking a cue from that we must treat SMEs in a special way and continue to en-courage them in Kerala. This calls for SME-friendly long-term policies, rules and financing, marketing and training systems. The Kerala Govern-ment must take the lead in becoming a model state for the nation in matters of SMEs. With the special focus of the Central Government in micro, small and medium enterprises (MSMEs), this can easily be achieved and all that Kerala leaders need is focus and the willpower to get it done.

Another mindset that we need to have is the creation and celebration of entrepreneurship within the state. For a state that is totally depended upon remittances which are spent not on creating wealth but on consuming it, we need to understand that the mind-set of entrepreneurship is that of cre-ation. Creation means production and not consumption. Whereas consump-tion blows the wealth, production cre-ates it. Decades of thinking in extreme socialistic pattern and the impact of the remittance economy had combined to make the state take a very dim view of entrepreneurship.

The present stakeholders; be they the citizens, the executive or the bu-reaucracy; all look at entrepreneurs as tax evaders, labour exploiters and profit-makers. What needs to be un-derstood is that it is from the profit that wealth is generated that can be dis-tributed. If that is understood by all in the state’s stakeholding systems, then the encouragement and celebration of entrepreneurship will happen. And that is what is exactly happening in leading industrialized states such as Gujarat, Tamil Nadu and Maharashtra. These states continue to flourish with entre-preneurship being the key ingredient for economic growth there.

So it should be clearly understood that ‘Emerging Kerala’ as a programme and the first such event planned may only be considered as the beginning point of our endeavours in industrializ-ing the state for bringing in investment to the state through the able means of building solid entrepreneurship within the state. We would then have changed our culture, a culture that encourages and celebrates wealth creation and distribution.

(The writer is Managing Director, Team Frontline Limited, President, Kerala Management Association, and Charter Member and former President, TiE Kerala)

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KINFRA has major roleKINFRA (Kerala Industrial Infrastructure Development Corporation) is playing the pri-

mary but the major role in the Emerging Kerala program because we are in charge of providing the land, water and power for the investors who come here to set up industries, says Mr S Ramnath, the Managing Director of KINFRA.

So far the state has been depending upon the NRI remittance to sus-tain itself but in the changing economy new ways for investment had to be sought out. It is in this background that the government has planned a major program to woo investors into the state.Emerging Kerala, unlike the Global Investor Meet (GIM), will be a continuous process recurring every two years. The idea is to showcase and promote Kerala as an investors’ destination. Signing of MoUs is not the main objective of Emerging Kerala. Here people interact and ask what type of projects they can invest for in the state. The program will continue even if a change of guard occurs because development is the common agenda of both the Left and Right parties.

KINFRA is fully prepared for Emerging Kerala and it has participated in all the presenta-tions ahead of the mega event. KINFRA is shifting its focus to companies which rely on the export market, says Mr Ramnath. “We will give special support to export business even if the company is small,” he said.

But the major obstacle KINFRA faces is the dearth of land, a problem often attributed to the geographical size of the state. “If someone comes and ask for, say, 250 acres of land we are helpless,” says Mr Ramnath. This shortage of land forces KINFRA to focus on small and medium enterprises. KINFRA has 24 industrial parks in all the 14 districts and 19 of them are active. The park has 17 solo ventures and others are joint ventures. The textile parks in Thiru-vananthapuram are fully engaged and a new park in Nadukani is just taking off. The new park at Palakkad has been sold. A major chunk of KINFRA’s land is on the Malabar area.

KINFRA is left with the 15% of land it has undertaken to develop industries. And it has sur-plus land in Kannur, Palakkad and Kalamassery (Ernakulam district).

The current policy of KINFRA is to develop industrial zones in Kochi, Thiruvananthapuram and Kozhikode. 1,000 acres of land will be allotted to each of these zones. KINFRA also has plans to move into high tech industries. This will not be IT & ITES but an application of IT and high precision engineering, Ramnath reveals.

S Ramnath

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The performance audit re-port on the Ministry of Coal

(MoC) by the Comptroller and Audi-tor Central of India (C&AG), placed in Parliament recently, has triggered another major scam, even before the problems arising out of the 2G scam have been settled to the satisfaction of the people. Like the 2G scam, the coal scam was also triggered by the structural reforms, started some two decades ago. When the power sector reforms started facing a serious crisis in 2001, the Ministry of Power had announced an ambi-tious programme named, ‘Power for All by 2012’. The crash program had aimed at the addition of 70,000 MW of power to the Indian grid and had spelled out the detailed strategies for power development, including the fast-track promotion of coal-fired thermal power stations.

The concluding chapter of the C&AG report on the performance of MoC starts with a candid observa-tion: “The production of coal has as-sumed greater significance after the Government of India announced its mission ‘Power to all by 2012’. Coal being the most important indigenous energy source of India, with a gross reserve (GR) of 2,85,863 million tonnes, the roles of various agen-cies involved in exploration, produc-tion and allocation of coal have, thus, increased correspondingly.”

True, coal is the most important fossil fuel for India. It accounts for 55% of the country’s commercial energy consumption, which has in-creased sevenfold during the last four decades and coal has played a major role in this increase. The importance of coal as commercial energy in national economic devel-opment was stressed by the Energy Survey of India as early as in 1965. Its recommendations in this regard continue to be relevant even today. Considering the limited reserves of petroleum and natural gas and the numerous constraints in nuclear and hydro power development, coal will continue to occupy the centre-stage of India’s energy scenario for de-cades to come.

With coal reserves over 285 bil-lion tonnes, of which around 100 bil-lion tones, is proven, Indian coal will play a key role in the domestic en-ergy market for the next century and beyond. However, the nation’s coal resources, spread over 27 major coalfields, are confined to half a doz-en or so major states in the eastern and south-central parts of the country (see table). Ninety percent of the lig-nite reserves estimated at 36 billion tonnes occur in the southern state of Tamil Nadu. The Department of Coal (DoC) of the Central Government is, according to the laws of the land, the

sole custodian of Indian coal and its development in the country.

MoC is a complex organization, responsible not only for the produc-tion and prospecting of coal and lig-nite but also for their marketing and

distribution. It has the support of the Coal Controller‘s Organization, which is a statutory body and discharges various statutory functions derived from the numerous Central statutes like the Colliery Control Order of 2000, the coal mines conservation and development acts of 1974, the Coal-bearing Areas (Acquisition and Development) Act 1957 and several other statutes, old and new.

The performance audit of MoC and associated institutions by the C&AG has brought out the numer-ous shortcomings in their working:

Delays in acquisition of land and as-sociated problems of rehabilitation, delays in diversion of forest land, delays due to adverse geo-mining conditions, delays in settling contract management issues, discontinuance of work by contractors, delays in get-

Coalgate: genuine reforms need of the hour

K Vijayachandran

As a rule, state governments, even

the governments of those states

where coal reserves are located,

do not have a say in the manage-

ment and mining of these resources.

Andhra Pradesh may sound an

exemption to this general rule: for

historical reasons Singareni Col-

lieries Company Limited (SCCL) is

a joint-sector undertaking of the

Government of Andhra Pradesh

and the Government of India with

equity capital in the ratio of 51:49.

But even here, despite its majority

shareholding, the AP Government

plays only a minor role in policy is-

sues or even in issues of day-to-day

management, thanks to the total

control of the DoC that prevails on

the management of the nation’s

coal sector.

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3130 3130


ting mine safety permissions and nu-merous other administrative problems contribute to the poor progress of mine development projects.

The C&AG report has recommend-ed single-window mechanisms for the clearance of mining projects along the lines of the Foreign Investment Promo-tion Board (FIPB): “Representatives of Central nodal ministries and state gov-ernments to grant the necessary clear-ances such as mining lease, mining plan, forest clearance, environment management plan and land acquisi-tion for accelerating the procedures

for commencement of production”. The efficacy of single-window clear-ances has been notoriously poor in our country thanks to lack of expertise and professionalism at various levels of governance.

Single-window clearance is a bu-reaucratic solution. It is a poor sub-stitute for decentralized governance administration as practised in more developed societies. The Coal Comp-troller’s Office in Delhi may retain its policymaking powers as a federal authority from a national perspective, and in the best interest of the Indian people, as decided by the MoC and Parliament. But state governments could play, wherever possible and rel-evant, a much larger role in coal sec-tor administration as well as related mining and environmental laws. The C&AG report has also highlighted the failure of the Coal Comptroller’s Of-fice in monitoring the performance of licensees, indicating the need for and relevance to developing state-level counterparts for the Coal Comptroller in Delhi.

As a rule, state governments, even the governments of those states where coal reserves are located, do not have a say in the management and mining of these resources. Andhra Pradesh may sound an exemption to this gener-al rule: for historical reasons Singareni Collieries Company Limited (SCCL) is a joint-sector undertaking of the Gov-ernment of Andhra Pradesh and the Government of India with equity capi-tal in the ratio of 51:49. But even here, despite its majority shareholding, the AP Government plays only a minor role in policy issues or even in issues of day-to-day management, thanks to

the total control of the DoC that pre-vails on the management of the na-tion’s coal sector.

The experience of SCCL’s equity structure is worth studying for emu-lation by Coal India Ltd (CIL) and its subsidiaries, so that coal administra-tion in the country could be liberated from the bureaucratic stranglehold of DoC. CIL has six subsidiary compa-nies engaged in mining and prospect-ing of coal. These are (i) Central Coal-fields Limited, Ranchi (Jharkhand), (ii) Eastern Coalfields Limited, Sanctoria (West Bengal), (iii) Western Coal-

fields Limited, Nagpur (Maharashtra), (iv) South Eastern Coalfields Limited, Bilaspur (Chhattisgarh), (v) Northern Coalfields Limited, Singrauli (Madhya Pradesh) and (vi) Mahanadi Coal-fields Limited, Sambalpur (Orissa). The respective state governments could jointly own these six public sec-tor companies along with the Govern-ment of India on 51:49 basis, similar to the equity structure of SCCL. The Central Government could hold the eq-uity shares either directly or indirectly through CIL, which could hold also the shares of Central Mine Planning and Design Institute Limited (CMPDIL), Ranchi (Jharkhand), and also be in charge of the mining and prospecting work in Assam and other states with miner coal resources.

Restructuring of the office of the Coal Comptroller in Delhi and reorga-nization of the public-sector coal com-panies broadly on the lines suggested in the foregoing paragraphs will greatly help in overcoming most of the short-comings and problems brought out in the C&AG’s report. Active participation and involvement of the elected state governments in the management of coal companies will make them far more responsive and help them to seek more democratic solutions to the problems faced by them. The division of responsibilities between the Central Government in Delhi on the one hand and the state governments that are close to the mines on the other will be far more rational: It is sure to improve the quality of policymaking as well as the efficacy of day-to-day administra-tion.

Coal-bearing states are eligible for royalty payments, rates of which are

fixed by the Central Government in an arbitrary manner and not based on sound federal principles. Other states, which are under economic and political compulsions to fall in line with national policies with regard to the choice of fuels, have little say in policymaking related to the marketing, transportation, distribution, pricing or R&D related to this commodity. Indian coal should serve as a cheap source of energy and support economic development even in the non-coal-bearing states.

Cheap Indian coal remains a pipe dream for the small and traditional in-dustries, especially in far-off states, like Kerala. Bharat Coking Coal Ltd, the coke-making subsidiary of CIL, is in business mainly to support medium and large industries. MoC is least in-terested in the R&D on prospecting

and production and use of Indian coals and it has no inhibitions even about promoting imports. Such policy weak-nesses are not touched upon by the C&AG report, which has estimated “the financial impact of the benefit to the private allottees of 194 net coal blocks to be Rs 1,85,391 crore.” These blocks were taken away from public-sector companies and re-assigned to the private investors in the name of meeting the power generation targets set by the programme, ‘Power for All by 2012’.

No doubt these are serious lapses and the culprits need to be booked. The argument that the exchequer has not incurred any loss does not hold water because the diversion of coal blocks from public-sector companies has affected coal production as well as power generation. Parliament has been in turmoil for weeks, but what is needed is political action towards gen-uine reforms, for curbing bureaucratic and political corruption, in the coal as well as power sectors. The C&AG re-port has brought out plenty of material in support of such reforms.

The Coal Comptroller’s Office in Delhi may retain its policymaking powers as a federal authority

from a national perspective, and in the best interest of the Indian people, as decided by the

MoC and Parliament.

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3332

Infopark at Kochi having become a hot destination for the global IT fraternity, PASSLINE sent some

questions to the CEO of the park, Mr Gigo Joseph, for his views on how it is preparing for the mega-event and what steps it is taking for infrastructure development for IT and ITES companies in Kerala. The following is Mr Gigo Joseph’s response to the questions:

‘Emerging Kerala’ is the most prestigious event initi-ated by the State Government to attract investors to the state and IT and ITES are two of the key areas identified for development. Since Infopark is an adorable shelter for IT and ITES in the state, how are you and the park prepared for the mega-event? Please elaborate your plans and strategies.

‘Emerging Kerala’ is one of the laudable initiatives of the proactive Government of Kerala to attract more investments to the state. This will greatly enhance the image of Brand Kerala from being a tourism destination to a business destination. The investor-friendly policies may also help to change the usual perception of Kerala.

IT/ITES is a key sector and Ker-ala has all the favourable factors to house this industry in the state. In-fopark, the prestigious IT park fully owned by the Government, already has a proven track record. The most-sought-after brand for any IT investor in Kerala is now housing 155 compa-nies and has generated employment for 17,000 people. The momentum is steadily growing with high-level expansion plans lined up. Infopark is going ahead with the Phase II expansion of the campus in 160 acres of land at Kakkanad, adja-cent to the Phase I programme. This first IT building in the project, which is in progress, is expected to be ready for operation by 2014. The first anchor IT company Cog-nizant has taken 15 acres and will be starting the cam-pus construction soon. We welcome IT/ITES companies and IT park real estate developers to set up operations in Phase II. In Phase II Infopark is opening up wide oppor-tunities for investors from various sectors. The project being planned as an IT township will have the following: IT/ITES buildings; BPO complex; hotels and convention centre; shopping malls/multiplexes; educational institu-tions; software/hardware parks; sports complex; recre-ational and entertainment avenues; residential facilities/guest house.Investors having expertise in the above areas will be given opportunities to partner the Govern-ment and land leased to them for long-term lease of 90 years.

What are the prospects for IT and ITES in the state? Please mention the impediments, if any, to the smooth development of the sectors?

Educated manpower: Kerala is blessed with a highly educated talent pool. The only state in India which has achieved almost 100% literacy, it has a good educational system producing highly talented resources every year. There are 30,000 engineering graduates coming out of its colleges every year. But we are still struggling to bridge the industry-academic gap.

Power and high-speed data connectivity: Kerala is the only state in India which has two submarine cable

landings, SE-ME-WE-3 and SAFE in Kochi, ensuring stable and high-speed data connectivity.

World-class IT parks: The Government is keen on developing IT parks across the state and we already have proven infrastructure in these—from Thiruvanan-thapuram to Kozhikode. These parks offer industries that suit the environment and ensure world-class facilities.

Infrastructure: The state offers the best infrastructure with three international airports—in Kochi, Thiruvanan-thapuram and Kozhikode— having connection to major international and domestic routes. All the IT hubs in Ker-ala are well connected with roads, rail and air.

Affordable and quality living: Kerala offers a peaceful environment for people to reside and its cities are af-fordable for living. There are lots of options to choose from—apartments and villas to waterfront properties. Healthcare and medical facilities are also excellent which create a perfect work-life balance for employees.

Cost advantages: Operational costs are cheaper in Kerala than in other cities by an estimated 30%. The IT parks here offer international work standards at very cheap rentals. Highly skilled talents are available at lower salaries as they can work very close to their home towns. Living costs are low, and attrition is only 4%, against 20% in other tier I cities.

Incubation initiatives: Major IT parks provide incuba-tion support for start-ups. Technology Business Incuba-tion in Thiruvananthapuram and Smart Business Center in Kochi are creating right platforms for entrepreneurs to develop their ideas.

What, according to you, are the areas that have to be rectified immediately for developing these sectors?

Investor-friendly policies: Many investors still hesitate to enter Kerala because they have a lurking fear that its political climate is not good. The fact, however, is that the state has changed a lot, which investors are still not aware of. We should frame policies to change their per-ception.

Infrastructure development: The Government should focus on developing good roads to avoid traffic conges-tions in the major IT hubs. There should also be more focus on rural areas located close to the cities for being developed in the field of IT.

Entrepreneurship development: It is nice to see more and more graduates passing out, and all of them have innovative ideas. But most of them end up in companies as employees. We need to put in more effort to mould these people into good entrepreneurs. This will generate more employment, help to boost our economy and cre-ate a good entrepreneurial community.

Timely completion and decision-making: We usually fail to execute projects on time. This makes investors ap-prehensive about the investment climate in Kerala. We should make investors feel confident about our state. Projects like Smart City gained great attention from all over the globe because of its delayed take-off. This will make our state lose its image.

Thrust to engineering and design services: There are many companies now setting up engineering and design offshore units, and Kerala should try to bring these

3332


P T Jose

P Rajendran

CEO: Infopark in for rapid expansion

Gigo Joseph

KSFE on new path of growth Kerala State Financial Enterprises

Limited, popularly known as KSFE, is a miscellaneous non-banking company and is one of the most profit-making public sec-tor undertakings of the State. Mr P T Jose as Chairman and Mr P Rajendran as Man-aging Director are steering KSFE to great heights contributing immensely to the finan-cial growth of the state.

A striking point is that all the funds mobi-lized by KSFE through its various schemes and chitties are advanced wholly to the pub-lic in Kerala itself, whereas other financial institutions and banks channel their deposits collected in Kerala for advances outside the state.

KSFE was created by the Government of Kerala with the objec-tive of providing an al-ternative to the private chit promoters in order to bring in social control over the chit fund business, so as to save the public from the clutches of unscrupulous chit fund operators who run chit companies without following any particular law.

KSFE has been registering impressive profits every year without fail since its inception. It pays to the Government of Kerala crores of ru-pees every year by way of guarantee commis-sion, service charges and dividend. Till March 31,2012, Rs 367.22 crore has been paid on the above heads of ac-counts. Therefore, financially and service-wise, KSFE contributes immensely towards the growth of Kerala’s economy.

Its paid-up capital is Rs 20 crore. When KSFE was formed in 1969 the paid-up capi-tal then was Rs 2 lakh, says Mr Rajendran.

Chitty is the main product of KSFE. From chitty subscribers and customers who take loans/advances, KSFE accepts various types of securities which include fixed deposits with KSFE or approved banks, bank guaran-tee, NRI deposits, LIC policies, National Sav-ings Certificates (NSCs), Kisan Vikas Patras (KVPs), chitty passbooks of non-prized chit-ties, gold security, post-dated cheques, per-sonal surety and property security.

With the proposal of Finance Minister K M Mani in the budget KSFE is stepping into the environment of protecting and conserv-ing non-conventional energy. KSFE is plan-ning to lend loans for buying equipment of reputed companies for producing electricity from solar energy, says Mr Jose.

3332 3332


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NE

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State Bank of India’s June quarter net profit more than

doubled on treasury gains from higher bond prices and lending to big corpo-rates, but a rise in bad loans pulled its shares down more than 4% of its mar-ket value.

The bank will expand its retail lend-ing in homes and autos to dominate, but shrink its mid and small corporate portfolio as it accounts for the high-est bad loans in an economy where growth has fallen below 6% from as high as 9% a few quarters ago. The

nation’s largest lender said net profit for the June quarter was at Rs 3,752 crore, up 136% from Rs 1,584 crore a year ago. Analysts had forecast a profit of Rs 3,620 crore. Net interest income, the difference between what it paid for funds and what it earned from lending, rose 14.6% to Rs 11,119 crore.

Non-interest income, such as in-come from guarantees, selling third-party insurance and mutual funds, and forex fee, was flat at Rs 3,499 crore. The bank’s gross bad loans jumped to 4.99% from 3.52% a year ago.

Pioneer in the power technol-ogy Supra Group has been

a brand name since its inception in 1988 under the inspiring leadership of the Managing Director, Mr T J Sub-hash. The Group has carved a niche for itself in the field of power in a short span with its quality products. Power control equipment, including Uninter-ruptible Power Systems(UPS), In-verters, Servo Stabilizers, Constant Voltage Transformers and Electronic Stabilizers are produced under the celebrated banner of Supra. Supra still stands as the lone brand in the market among its competitors by supplying its products of quality and durability. The solar range of products from LineOn includes Solar Panels, UPS, Inverters, Lighting Systems, DC Power Supply, DC-DC Converters, Battery Chargers, SMPS and Energy Saving Systems.

Supra Group had dominated the spectrum quickly after it began opera-tions 23 years ago by using the higher demand and lack of competitors. The group has gained considerable expe-

rience and deep insight in to power control technology and has emerged as one of the larg-est and most inno-vative designers and manufacturers of power control products in India. Besides being headquartered in Kochi, Supra Group has a string of indepen-dent offices and facilities throughout India. The motto of the company has always been the highest level of cus-tomer satisfaction through quality and reliability of its products as well as the service provided to its customers. Now the Group is enriched with million strong customers includes both public and private sectors. Supra Group con-sists of six companies including three manufacturing units—Supra HiTech Electro Equipments (P)Ltd, Powerlink Technologies(P) Ltd, Supra Electron-ics, LineOn Power Technologies (P)Ltd, Supra Power Research Centre and Supratronics (P)Ltd.

Supra Group: pioneer in power control products

investments into the state. Many oil companies and con-struction companies in the Middle East are outsourcing their work to India. This can generate good employment opportu-nities in Kerala.

Reforming IT policy: Reform in the IT policy is required. We should promote satellite campuses through special in-centives for companies which are willing to start operations here. Also the IT policy should include packages to promote rural BPO initia-tives. Rural BPOs can create more employment opportunities for economically backward people.

Initiatives by business bodies: CII, KCCI and other business bodies also should give importance to this new-generation sector. Collective efforts by busi-ness bodies and other sources are required to make Kerala an IT hub. Like any other industry the IT industry too requires a boost from other sources. A separate chapter for IT should be formed in these bodies to raise the concerns of compa-nies and arranging industry-specific programmes.

Association with Nasscom: The Government can associate with Nasscom, an apex body, and do many things to promote the industry by organizing sum-mits, arranging delegations etc.

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Obituary

Nation loses its milkmanDr Verghese Kurien, the me-

chanical engineer turned dairy specialist, was a great innova-

tor, democrat and patriot. Kurien, born on November 26, 1921 in Kozhikode, Kerala, liberated the Anand Milk Producers Union Limited (AMUL) from the stranglehold of Polson, a British multinational com-pany, who had a monopoly hold on the large dairy market of Mumbai metro for several decades. He took over AMUL in 1949, soon after national independence, and re-built it as a cooperative venture, based on extensive grass root level democracy. He believed that, develop-ing indigenous capability was essential for re-capturing the massive dairy market of Mumbai and then venture into the massive national market that was emerging.

Management of the large R&D network he built in support from AMUL was distinctly different from that of the CSIR(Council for Scientific and Indus-trial Research) bureaucracy. The highly specialized science and technology S&T personnel were employed by the dairy farmers and were accountable to them through cooperative institutions. Kurien made democracy work in the most democratic way. He was a conscious practitioner of democratic centralism and resolved the problems of democracy in the most democratic way.

I had the good fortune of meeting him once: That was in the late eight-ies, during the second Nayanar Ministry, when Gowry Amma, in her capacity as Industry Minister, had sought his help in re-organizing the dairy indus-try under Milma, which was administered by the Agriculture Minister. True, MILMA was organized on the Anand model, but Kerala soil was found to be un-conducive to AMUL type democracy and the experiments based on this initiative was a failure.

Kuttappan Vijayachandran

Verghese Kurien:1921-2012

SBI net profit doubles in Q1

The Confederation of Indian In-dustry (CII) welcomed the Cen-

tre’s decision to relax Cabotage rules for the Vallarpadam International Con-tainer Transshipment Terminal (ICTT) at Kochi, as it will help the project rea-lise its full potential. There has been a growing demand from the shipping community, DP World and the Kochi Port for the relaxation of cabotage law allowing foreign flag carriers to carry cargoes between Indian ports and CII has also been proposing it, as it will help develop trade and industry in the state to a large extent.

“We are very happy that this an-nouncement has come just prior to the Emerging Kerala meet happening this week and it gives a positive boost to the entire program and clear signal that Kerala is indeed emerging”, held Mr VK Mathews, Chairman, CII Kerala State Council. The much awaited an-nouncement of relaxation in the Cabo-tage rules for the Vallarpadam terminal is likely to herald a new era in the con-tainer transshipment business from the region. Current cabotage norms allow

foreign ships to ply on the coastline of the country only after getting a license. The Merchant Shipping Act, 1958, Sec-tion 407, states that no ship other than an Indian ship or a ship chartered by a citizen shall engage in coasting trade except under a license granted by the Directorate General of Shipping.

The relaxation would allow con-tainers that ar-rive at ICTT to be shipped to other Indian ports. About two million tonnes of Indian cargo is transshipped through Colombo every year. If a part of this is handled at Kochi, it will be a huge saving for Indian trade in terms of freight costs, he said. It is ex-pected that around 50,000 direct and one lakh indirect employment oppor-tunities will be generated within five years. A massive investment of about Rs 15,000 crore will also be pumped into the sector .

CII welcomes move to relax cabotage norms

VK Mathews

T J Subhash

34


Chief Minister Oommen Chandy is a very optimistic and hard-

working man. His dream is to make Kerala a fully developed state with strong infrastructure and create an in-dustry-friendly atmosphere in the state which will turn it into the preferred des-tination of the discerning entrepreneur/investor.

During the last 15 months that he has been in the saddle, Oommen Chandy has made all-out efforts to run a tight ship, taking quick decisions on every pending issue, eagerly meet-ing the ordinary man and woman and spending time with them in an earnest attempt to solve their problems—in short, living up to the battle cry, athive-gam, bahudooram.

But the efforts of a single person, however earnest he is, will not be able to make the powerful paradigm shift that Kerala needs now. Let us have a quick review of the position now in the various sectors of the economy. First, the primary sector, agriculture. Kerala has the most ideal conditions for a flourishing agricultural sector—fertile soil, adequate rain, 12 hours of sunshine throughout the year, and, of course, the enterprising farmer, condi-tions ideal for the vigorous growth of a wide range of crops. Yet, the story of Kerala’s agriculture has been a story of disappointments and missed oppor-tunities.

The area under paddy and its pro-duction have dwindled to one-fourth of what they were 50 years ago. Coconut, the other major traditional agricultural product of Kerala, has fared equally badly. Here both productivity and pro-duction have fallen.

Rubber, fortunately, is an excep-tion. The area under the crop and its total production and productivity have all been steadily increasing over the years. In the midst of the encircling gloom of failed efforts in Kerala’s agri-culture, the performance of rubber has been glorious. The reasons for its suc-cess have been studied and identified: ensuring a remunerative price for the farmer, excellent extension network capable of providing to the farmer the latest research findings, the coordinat-ing role played by the Rubber Board which believed that the ‘buck stopped there’. If only Kerala’s Agriculture De-partment was reorganized on these lines, splitting it into four or five major crop groups, with the specially trained staff in each group attending to all as-

pects of the select crop, ranging from research to extension to marketing and financing!

Of course, new investments will be needed in the area of value-added production in every crop, including rub-ber, coconut, paddy and cocoa. The ‘Emerging Kerala’ campaign should attempt to identify and promote new technologies for value-added produc-tion and, of course, new entrepre-neurs. Now let us come to industry. The failure to use modern technology has rendered the traditional coir in-dustry stunted. Fortunately the indus-try has woken up to this problem and seems to be keen now to adopt new technologies and manufacture a wide range of new eco-friendly coir prod-ucts. Cashew and handlooms, two other traditional industries, do not offer any significant growth opportunities.

It is well known that Kerala does not possess any of the major minerals like

coal and iron ore, which are consid-ered to be essential for development of basic industries. But we have the pre-cious mineral sands on our beaches.

A variety of products including tita-nium dioxide and titanium metal can be manufactured beginning with benefici-ating the sand deposits. Cost-effective technologies are available in the world for this. But the votaries of environ-mental protection in Kerala oppose all such projects and whenever a value-added project proposal comes up, they oppose it tooth and nail. But, sur-prisingly, they are not opposed to the crude mining operation done by some local vested interests which simply dig out the sands and export them.

On the other hand, if a comprehensive manufacturing project could be taken

up here, the mining technology with operation could be carried out suitably mitigating all risk to the environment and resulting in huge value-addition and employment generation.

The tertiary services sector alone has been propping up the Kerala economy, to a certain extent, in the context of both agricultural and indus-trial sectors failing to pull their respec-tive weights even. The tourism industry has been the star performer here. But we have only scratched the surface. The natural beauty of the state, with its beaches and forests and hills and its wide variety of flora and fauna, offers a grand opportunity for more growth in this sector. New concepts like farm, medical and ayurveda and eco tourism and homestays are slowly but steadily becoming popular. New investments and entrepreneurs are sure to come into this sector.Another major service industry is the IT industry. Though the much-awaited Smart City project is un-

der implementation, much cannot be expected from this at the moment. In any case, the recession in the West and our neighbouring states of Tamil Nadu and Karnataka already having forged ahead should make us scale down the expectations here.

If all the above sectors are to prog-ress as planned we have to strength-en our infrastructural facilities. Power generation and distribution, ports, highways, water supply and sewer-age, railways, have all got to undergo significant toning up, infusion of new technology and new investment. All the investment required here cannot obviously come from the Government. In fact the bulk of it should be from the private sector as a part of vari-ous public-private-people-participation projects. For this to become possible,

private industry and the enterprising class of people should get convinced that the Kerala Government means

business, that the Government is de-termined and it possesses the political will to bite the bullet. Past ideologies must be thrown away.

But the signals transmitted by some of the recent decisions of the Govern-ment are not encouraging. For exam-ple, while we are inviting private enter-prise to come to Kerala and invest, the people who are already here receive only step-motherly treatment. In Nel-liampathy, unnecessary controversies have been generated about the fate of the plantations on leased Government land.

Similarly, the failure of the Govern-ment to get the cabotage rules modi-fied is slowly killing the Vallarpadam Container Station, which is forced to operate at 30% capacity. Our inability to implement a beach sand mining proj-ect bringing in transparent procedures is another disappointment. The unwill-ingness on the part of the Government to take speedy action and evolve a fast land acquisition procedure for road projects also has sapped a lot of en-thusiasm.

Some drastic steps are to be taken urgently for reducing Government ex-penditure and bringing down budget deficits. If some resolute steps are taken by the Government about these issues it will be able to generate con-fidence in the minds of the investors. Will the Government realize this and give some positive signals? Only then will the ‘Emerging Kerala’ campaign be crowned with success.

(The writer is a former Principal Com-missioner of Commercial Taxes, Prin-cipal Secretary to the Tamil Nadu Government’s Industries Department, Chairman of the Tamil Nadu Electric-ity Board and Chairman of the Rubber Board)

To make the event successful

If the sectors are to progress as planned we have to strengthen our infrastructural facilities. Power generation and distribution, ports,highways, water supply and sewer-age, railways, have all got to undergo significant toning up,

infusion of new technology and new investment. All the investment required here cannot obviously come from the

Government. In fact the bulk of it should be from the private sector as a part of various public-private-people-participation

projects. For this to become possible, private industry and the nterprising class of people should get convinced that the Kerala Government means business, that the Government is

determined and it possesses the political will to bite the bullet. Past ideologies must be thrown away.

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P C Cyriac

35


3534


Teamwork, foresight and hope—all seem to have paid well.

Within 90 days of its inception, the number of applications Startup Vil-lage has received from campus start-ups has grown to 200. “Entre-preneurship is nothing but ev-erything about doing things,” says Mr Sijo Ku-ruvilla George, CEO of Startup Village, Kala-massery, Kochi. “Born out of a brainstorming meeting in the room of Dr D H Mittal, Head of National Science and Technology De-velopment Board, in April 2009, Start-up Village had a long journey through various technical and financial commit-tees over the last two years and the fi-nal approval of the Union Government came in 2011”, says Mr George.

The construction of Startup Village started at the Kinfra Hi-tech Park in January 2012 and the facility was in-augurated by Infosys mentor Kris Go-palakrishnan in April 2012. “Today, we are on a mission to create a thousand startups over the next 10 years and search for a billion-dollar campus start-up from the engineering colleges of the state”, he says. The selection process begins when the student submits the application form on its website->http://www.startupvillage.in/apply-now/

The selection committee com-prises representative members from the Department of Science and Tech-nology, Technopark, industry and key representatives of Startup Village and MobME. Interviews will be conducted by the CEO later. On the basis of the information provided and insights from the interview, the committee evaluates and gives provisional incubation status. Confirming incubation status happens six months after the provisional status on the basis of the performance of the team. The criteria for giving provisional incubation status are clarity of thinking

of the entrepreneurs, the implementa-tion strength, customer orientation or the ability to generate revenue and the efficiency of the team. The startup companies will come either in a prototype stage or in a stage of generating some revenue. Those companies that are granted physical in-cubation status will be given physical space too along with the other facilities and the rest will be given virtual incubation status which is devoid of giving physical space.

More than 35% of India’s popula-tion are below 20 years old. By the year 2010, about 325 million people in India reached working age, considered to be the largest in the world. This huge op-portunity could be utilized only if there is a massive scale-up in the incubation and entrepreneurial ecosystem. The Department of Science and Technol-ogy is the nodal agency in the Union Government for incubation initiatives. The companies incubated at Startup Village will be eligible for service tax exceptions during the tenure of the in-cubation period of three years and also provides a grant of Rs 2.5 crore.

The crew of mentors of the startups consists of renowned personalities from the sphere of information technol-ogy as well as industry experts. Mr Kris Gopalakrishnan, India’s most success-ful IT entrepreneur, is the chief men-tor for the students and will guide the startups for the next 10 years. Adepts like Rajan Mathews, Director General of COAI; Kiran Karnic of Nasscom; Ganesh Lekshminarayan, CEO of Dell India; Krishnakumar Natarajan, CEO of Mindtree; Sasha Mirchandani; Ab-hishek Goyal and Kerala’s most thriv-ing entrepreneurs like Navas Meeran of the Eastern Group, Jose Thoams of the Choice Group, Murali Gopalan of US Technology etc.

“Being highly literate and with near 100% teledensity, high IT literacy and access to broadband, Kerala is the

Startup Village sees a sea change in IT

Startup Village now sprawls across a total area of 5,000 sq ft. Another 10,000 sq ft is under construction

and will be ready by October. Within two years 1,00,000 sq ft is expected to be added to these, making Startup

Village one of the top five incubators in the world and the largest in telecom globally.

Sijo George

most appropriate place for starting such a venture. Keralites from different spheres like the academia, media, bu-reaucracy, business and politics have been of full support so far. It is the home of MobME Wireless and we are highly obliged to retain the trust and support that the people here extended to us when we started this venture. We are highly indebted to them all and we believe in contributing back to society which has extended us so much of support and favoured us to try our best to help to create technology entrepre-neurs in our state”, says Mr George.

Startup Village now sprawls across a total area of 5,000 sq ft. Another 10,000 sq ft is under construction and will be ready by October. Within two years 1,00,000 sq ft is expected to be added to these, making Startup Village one of the top five incubators in the world and the largest in telecom glob-ally.

Startup Village is getting ener-gized day by day. The number of barcamps, hackathons and startup events is shooting up. “In the course, we ought to confront many challenges too. Perhaps, the biggest will be when a potential entrepreneur is unaware of his talents as an entrepreneur. We feel that India is still not very ideal for campus startups. Startup Village is a genuine attempt to come out of these constraints for the better future of our country,” says Mr George.

The unit has received a $10 million angel fund for financial assistance to the startups. In case of high invest-ments, the fund will co-invest with other angel funds. ‘Canaan Partners’, ‘Blume Ventures’ and ‘Kae Capital’ are the investment partners. Companies recognized by the NSTEDB of DST are eligible for service tax exemp-tions for the first three years and up to Rs 50 lakh of revenues. Initial tax support servic-es to new units, IP services at discount rates, discount credits on hosting ser-vices, priority technical support, high-level consulting advice on a no-fee ba-sis from an Indian tax and regulatory perspective etc will be of great advan-tage to beginners here.

What are your plans in connection with ‘Emerging Kerala’?

“We will be putting up a pavilion at the site. Kerala is a very suitable place for incubation of future entrepreneurs. More than 100 new units by campus startups had come up in the state last year. We expect that we can showcase our venture through ‘Emerging Kerala’, attract more investors for Startup Vil-lage and woo more private companies to tie up with us to further improve our quality”, says Mr George.

18years of

excellence

36


Another excellent ex-

ample of a non-profit

social enterprise in India

is Rang De, which was

founded by Ramakrishna

and Smita Ram in Janu-

ary 2008. Rang De is a

peer-to-peer online plat-

form that makes low-cost

micro-credit accessible to

poor people in both rural

and urban areas in India.

While we discuss various is-sues connected with ‘Emerg-

ing Kerala’ and also brainstorm on how to make Kerala emerge as an eco-nomic power, I think one subject on which not many have focused is social entrepreneurship. The only way a state or a country can progress is by encour-aging entrepreneurship. However, in a country like India where the social and economic divide is increasing day

by day, social entrepreneurship is the need of the hour. I think that in a state like Kerala where making money is be-ing considered as a ‘crime’, people will welcome social entrepreneurship ven-tures. This article will give you some basic ideas about this field. The infor-mation has been collected from vari-ous published articles.

Social entrepreneurship is a prac-tice that integrates economic and so-cial value creation, which has a long heritage and a global presence. The global efforts of Ashoka, founded by Bill Drayton in 1980, to provide seed funding for entrepreneurs with a so-cial vision; the multiple activities of the Grameen Bank, established by Professor Muhammad Yunus in 1976

to eradicate poverty and empower women in Bangladesh, and the use of art to develop community programmes in Pittsburgh by Manchester Crafts-men’s Guild, founded by Bill Strickland in 1968; —these are all contemporary manifestations of a phenomenon that finds its historical precedents in the values of Victorian liberalism. Entre-preneurs are innovative, highly moti-vated and critical thinkers. When these attributes are combined with a drive to solve social problems, a social entre-preneur is born. Social entrepreneurs and social enterprises share a commit-ment of going ahead with a social mis-sion of improving society.

Globally social entrepreneurship is growing rapidly and getting immense attention among many sectors. There are several reasons for the popularity of social entrepreneurship. Something inherently interesting and appealing about entrepreneurs is ‘Why’, ‘How’ and ‘What’ they do. Social enterprises are social mission-driven organizations which apply market-based strategies to achieve a social purpose. One well-known contemporary social entrepre-neur is Muhammad Yunus, who was honoured with the Nobel Peace Prize in 2006. He is the founder and man-ager of Grameen Bank and his work echoes a theme among modern-day social entrepreneurs that emphasizes the enormous synergies and benefits when business principles are unified with social ventures. Another excel-lent example of a non-profit social enterprise in India is Rang De, which was founded by Ramakrishna and Smita Ram in January 2008. Rang De is a peer-to-peer online platform that makes low-cost micro-credit acces-sible to poor people in both rural and urban areas in India. Individuals invest directly with borrowers from all over India, track their investments online and receive regular repayments. In In-dia, social entrepreneurship has been gaining ground in various sectors of the economy with more and more youth evincing interest in the field, including those from prestigious Indian Institutes of Management (IIMs) and Indian Insti-tutes of Technology (IITs).

Social entrepreneurs are not non-profit organizations: Social enterprises traditionally lean towards a non-profit business model as they are society-oriented organizations. For the social enterprises, their social mission is an explicit and central objective. This ob-viously affects their perception and

assessments of opportunities. They purely focus on the social impact of their business activities, not on wealth creation.

Many commercial businesses are of the view that they are fulfilling vari-ous social needs along with their busi-ness motive to earn maximum profits, but social entrepreneurs are complete-ly different from them. The social im-pact is the primary motive of their busi-ness.

Nowadays the main aim of social enterprises is to generate a profit in or-der to pursue their social and environ-mental goals. The profit from a busi-ness can be reinvested with an aim to expand its service area for the welfare of society. Similarly, the profit of a so-cial entrepreneur can also be used to support a social cause, such as funding the programming of a non-profit orga-

nization for social purposes. Moreover, a business can accomplish its social aim through its operations by employ-ing individuals from disadvantaged backgrounds or by providing finance to those micro-businesses which have difficulties in securing investment from mainstream lenders.

In fact, there is a great difference between social entrepreneurs and non-profit organizations on the basis of their goals and objectives. Social entrepreneurs are driven by social as well as financial goals whereas non-profit organizations work purely for so-cial purposes. The primary source of funds for social ventures is their earn-ings while non-profit organizations rely on donations and charitable contribu-tions.

The recruitment policy of social entrepreneurs is different from that of non-profit organizations because in non-profit organizations, people par-ticipate voluntarily, whereas in social enterprises people are selected on the

basis of their skills and performance. The performance of social entrepre-neurs is measured on the basis of so-cial value delivered along with financial returns, while a non-profit organization is evaluated merely on the basis of so-cial value they have delivered. Social enterprises are run in an entrepreneur-ial setting, using marketing tools of commercial and social advertisements for selling their products and services in a sustainable manner, whereas non-profit organizations are run much like most organizations relying on a social plan, fund-raising, social outreach etc, selling services and products for free, all of which increase the risk of non-sustainability. Grameen Bank, SKS Microfinance, Rang De and Arvind Eye Care are recent examples of social en-trepreneurs in India, whereas Helpage India, CRY, AID etc are recent exam-ples of non-profit organizations.

The Indian scene is full of possibili-ties and challenges. The country pos-sesses capable human resources, and has made good progress in achieving scientific and technological capabili-ties. The economy has been witness-ing rapid growth since the onset of liberalization from 1991 onwards. Un-fortunately the social and environmen-tal problems of the country are increas-ing year after year which necessitates the extensive application of multidisci-plinary approaches and entrepreneur-ial energy in the social and environ-mental sectors.

This has got impact in every state. Hence the state also should encourage and support social entrepreneurs. The concept of social entrepreneurship is not known to many. Hence ideally this should be taught in the B-schools and various other similar academic insti-tutes. The State can also facilitate the Industries Department to have better knowledge about this growing concept so that proper advice could be given to the aspiring entrepreneurs. We can address many issues like waste man-agement, drinking water issues, power generation etc by promoting social en-trepreneurship.

(Sajeev Nair is a successful en-trepreneur, best-selling author and an internationally renowned life coach. Bramma Business Insights, his ven-ture in business consulting, provides consulting services in social entrepre-neurship. To know more about Sajeev Nair please visit www.sajeevnair.com)

SOCIAL ENTREPRENEURSHIP

Unseen opportunities

Sajeev Nair

3736


37


The Government of Kerala is hosting the biennial event

‘Emerging Kerala-Global Connect’ with the expectation of attracting investment from all over the world. It is a welcome initiative. The goals of the event such as making Kerala a premier global hub of economic activity through fostering entrepreneurship and industry, pre-senting and showcasing the state and creating a platform for bringing togeth-er all stakeholders in order to achieve the vision of an enterprising Kerala a reality are well-thought-out. But to make this happen, it requires real com-mitment. If we fail to achieve the goals, ‘Emerging Kerala’ will boomerang.

Kerala has great strength, com-pared with other states, conducive to investment: it is top in human devel-opment index (HDI), the density of science and technology personnel is the highest among all states and in-frastructure here is better. However, experience shows that we have failed to attract foreign, domestic and Central investments. This being the fact, we should be more vigilant.

The three-day meet (September 12-14) should be the beginning of a long-drawn process of attracting industrial investment. Industrial investment will flow to the state in an environment of a win-win situation. The confidence of investors has to be earned for sustain-ing such an investment flow. Certain steps that the state has to take to woo investment are:

Institutional mechanism

Kerala State Industrial Develop-ment Corporation (KSIDC) is des-ignated as the nodal agency for the conduct of the event. The Department of Industries and others joined hands with KSIDC. American Chamber of Commerce in India (Amcham India), Nasscom, the Confederation of Indian Industry (CII) etc are the partners in the event.

The nodal agency should be strengthened as an institutional mech-anism with experts drawn from their domain areas to continue the dialogue with the delegates, coordinate among various departments, provide escort services etc. Otherwise the initial en-thusiasm will die out soon without any tangible results being achieved.

Single-window clearance

The single-window clearance sys-tem ensures that an entrepreneur, once he submits a composite appli-cation form to a designated contact point, will get the final clearance within a specific period from the date of sub-mission of the application. Somehow or other the system is not functioning to the satisfaction of investors. The system should be revamped to make it effective.

Voluntary disclosure

As an alternative to the single-win-dow clearance system, there can be voluntary disclosure by investors that they have complied with the necessary rules and regulations of the Govern-ment in establishing the industry. This will avoid unnecessary delays in get-ting the clearances/approvals/licenc-es. Many states in India have experi-mented with this and reaped benefits.

Validity of policies

The State Government is announc-ing its policies from time to time. The payback period of any industrial in-vestment is found to be more than five years, but in Kerala it is usual that the Government changes every five years

A golden opportunity for investment

Prof Job K T

The three-day meet (September 12-14) should be the beginning of a long-drawn process of attracting

industrial investment. Industrial investment will flow to the state in an environment of a win-win situation.

The confidence of investors has to be earned for sustaining such an investment flow.

from the UDF to the LDF and vice ver-sa. Hence it is the demand of industry to a have policies having validity of 10 years or so. This will ensure consis-tency in Government policies.

Learning from earlier events

In the past also Kerala has orga-nized several investor events like the Global Investor Meet (GIM). These were held in a grand manner. There were announcements of inking new memorandums of understanding (MOUs) with investments of a few thousand crores of rupees. But ev-erybody forgets about these and the MOUs become history.

It is time to learn from our experi-ences. We must thoroughly analyse

what happened in the past and draw lessons from them so as to be more effective in the future.

Venue of biennial event

The earlier investor meets were or-ganized in Kochi perhaps because of its importance and on logistic consid-erations. ‘Emerging Kerala’ is planned as a biennial event. Hence it will be advisable to change venues. Thiru-vananthapuram and Kozhikode may be considered. The change in venues will be an opportunity to showcase the particular advantages of the places.

(Prof Job is a senior faculty mem-ber at the Centre for Management De-velopment, Thiruvananthapuram)

3736


38


For more than 18 years now, has been a leading provider of busi-

ness automation solutions in Kerala. In fact, it was the pioneer in introducing bar code technology in the state.

Sasikanth Prabhu, Mathew K J, Madhu P B and Manoj Leelanivas were youngsters just out of college back in 1994 when they started Van League. None of them had any significant busi-ness legacies to bank upon. But all the four were enthusiastic about starting a business enterprise of their own when the idea was mooted at a casual meet-ing. Three of them were engineers

and one had a manage-ment degree. At that time the IT boom was not even a small beep and people with such educat iona l backgrounds either went to

the Gulf or the US. What was probably most attractive to them about the idea of their own business enterprise was that they could continue to be in their hometown and try to earn a living in the state itself.

T h e y were particu-lar about one thing though: their busi-ness venture should be s o m e t h i n g unique and special and not any run-

of-the-mill kind. That was when they came upon barcode technology. It was

automation hitherto untried in their region and as solution providers they had to have good programming skills as well as some knowledge of elec-tronics. It fitted in well with their values and their technological expertise and skills.

People around them were appre-hensive and doubtful: family friends, in fact almost everyone. Back then very few people had even heard of bar-codes let alone used the technology. Both potential customers and software providers were doubtful of the benefits of the technology.

Business was sluggish in the initial years. But slowly it started picking up. The last five years have especially seen good growth in the market. Retailers, both supermarkets and textile shops, are the biggest users of the technol-ogy. Bar coding has now become a de facto standard for even the small 500-sq ft corner shop. In the manufactur-ing industries, logistics companies and

wholesalers, complex, sophisticated applications, involving a combination of bar coding, mobile computers and application software have been de-ployed. In fact bar coding has been used for a variety of applications like mobile billing, queue-busting, inven-tory control and stock-taking, dispatch and receipt of goods, work-in-progress tracking, library management etc.

After 18 years Van League has re-mained a medium-sized organization and this has helped it exercise greater control over its operations as well as minimize costs. Because of that it is able to give prompt service to its cus-tomers in the most cost-effective man-ner. Combined with its in-house manu-facturing facility for consumables like

labels, its exemplary skills in program-ming and its long years of experience, it is in a position to offer its customers the best quality products and solutions in the cheapest and most reliable man-ner.

Looking back, the factors behind its growth and longevity are many, but a few need special mention, what Van League calls its hallmarks—Quality, Reliability, Technological Excellence and Exemplary Service. These are the traits that have made it the choice of hundreds of organizations all over Kerala.

38

Nitta Gelatin India Limited (NGIL), India’s major manu-

facturer of gelatin, is a joint venture of KSIDC (Kerala State Industrial De-velopment Corporation) and Japan’s Nitta Gelatin Inc. Established in 1975, the public limited company exports 60%-65% of its products to more than 35 countries. It was incorporated as Kerala Chemicals and Proteins Ltd but changed its name to Nitta Gelatin India Limited in 2008.

Mr G Suseelan, Managing Direc-tor of Nitta Gelatin, says the company had reported the highest profit in 2009-2010 but witnessed a slump in 2010-2011 because of the global recession. During the recession the world wit-nessed a slump in meat exports. Since the raw material for gelatin is extracted from cattle bone and skin (Nitta Gelatin

uses only cat-tle bone for its raw material), the dip in the export of meat affected the p r o d u c t i o n . But it picked up the mo-mentum in the last financial year, coming

up with improved performance. Gela-tin, the major product the company manufactures, is used in soft and hard capsules and is sold in international as well as domestic markets like Mumbai, Chennai, Bangalore and Delhi. Its mar-ket for gelatin in Kerala is limited.

Apart from gelatin, the company makes collagen peptide, a value-add-ed product from gelatin, mainly used for osteoarthritis, a degenerative joint disease, caused by the progressive destruction of the cartilage. Collagen peptide promotes cartilage health, im-proves joint flexibility and mobility in joint function and reduces joint pain. Its efficacy in improving joint health has been conclusively proven on the basis of various clinical studies in In-dia and abroad. This product has been widely used in Japan, the US and Eu-

rope and has growing acceptance in India as well. NGIL is also looking for opportunities of export of this product to neighbouring countries and is look-ing for suitable partners.

Gelixer CollagenPep is NGIL’s OTC health food supplement which contains collagen peptide and promoted for joint health. The product was developed by its collaborator’s scientists in Japan. Gelixer CollagenPep is available in the medical shops of Kerala as well as Tamil Nadu. The company is moving in tune with the latest developments in marketing, says Mr Suseelan. “We are opting for internet marketing. We have opened a website exclusively for Gelixer. The product is available online through its interactive website www.gelixer.com,” he says. The site has op-tions to buy the product online and the consumers will get instant response to their queries through the website.

“By following the trend of digital marketing we are going up-to-date with the times, enabling ourselves to learn new things,” says Mr Suseelan.

The prime competition for Gelixer in the Kerala market is from ayurvedic products. But instead of competing with ayurvedic products Nitta Gelatin is treading on a parallel path.

The major challenge that Nitta Gelatin faces is the scarcity of raw materials and the increasing transpor-tation costs. Since the manufacturing plant is situated at the southern tip it creates problems in transporting the raw materials from North India. In-creasing transportation costs results in increased cost of production for Nitta Gelatin. The company partly solved the problem by setting up plants in Ma-harashtra and Gujarat where the raw material will be processed initially and the semi-processed material will be transported to Kerala.

The company has been certified with ISO 9001 and ISO 14001, and the Certificate of Suitability (COS) by the European Directorate for the Quality of Medicines (EDQM).

G Suseelan

Mathew K J

Madhu P B

Nitta Gelatin—major gelatin manufacturer

Van League—choice of hundreds of organizations

3838


39



The SCMS Group of institutions, one of the foremost names in

the country’s higher education sector, had its beginning with Prathap Founda-tion for Education and Training launch-ing the School of Communication and Management Studies (SCMS) at Kala-massery in Kochi in 1976. SCMS-CO-CHIN, as its business school is known today, has since grown to be one of the very few B-schools in the country with all the credentials and accreditations that most others look forward to with awe.

Besides the B-school, the founda-tion has established numerous other institutes of global standards, par-ticularly in the fields of engineering, technology, mass communication and biotechnology. “SCMS stands out from institutions because of its quality, at-tainments and high performance lev-els. It is the only accredited B-school

in the state. According to the All In-dia Council for Technical Education (AICTE), accreditation is the final test of quality for a business school. Most of the PGDM (Postgraduate Diploma in Management) B-schools claim that their PGDM is equivalent to MBA (Mas-ter of Business Administration). This claim is illegal as long as they do not have an order from the Association of Indian Universities (AIU) to that effect. We are the only autonomous B-school in Kerala which has got MBA-equiva-lent recognition from the AIU for our PGDM programme. We are, again, the first B-school to get ISO certification for quality management and teaching sys-tem. We are also the lone recipient of a grant from the AICTE for our excellent performance record,’’ says Dr G P C Nayar, Chairman of the SCMS Group.

“We provide an ethical dimension to management teaching with emphasis on good behaviour and social respon-sibility. Ethics is taught as a full course at SCMS,’’ Dr Nayar adds.

The foundation has expanded its reach and opened its new centre in Banga-lore—SCMS COCHIN Bangalore Centre. The group has also applied for university status for it. “We do not deviate from the moral and ethical princi-ples that are dear to us. We will, per-haps, be the only group which does not charge cap-itation or levy any amount other than that prescribed for our programmes,” says Dr Nayar.”

In Karukutty, near Kochi, is situated the group’s engineering college on 32 acres of land. There is a plan to start a new engineering college there. A feature that makes SCMS unique as a

business school is its tie-up with great foreign institutions like La Trobe Uni-versity, Deakin University, the Univer-sity of Canberra, University of Applied Sciences-North-Western Switzerland, North Carolina Central University and the University of Colorado. “Presence of faculty members from across the globe provides our students with a global perspective. Professors from foreign and other universities take classes as part of this tie-up. SCMS has also established a chair on climate change with Professor Cleo Pascal of Chatham House, UK, as consultant professor and Dr C K Rajan as profes-sor,’’ says Dr Nayar.

According to him, SCMS is the only institute which had achieved 90% placement even during the recession. “Almost 95% of our students have

been getting placement, in reputed companies, ever since SCMS was es-tablished in 1992, he adds.

“SCMS aims at grooming leaders of tomorrow who will uphold the philos-ophy of social commitment and ethical behaviour while creating wealth for the nation. Specialized training is provided at SCMS to improve students’ com-munication skills, public speaking and presentation skills and interpersonal relations skills,’’ he says. SCMS also focuses on development of the ana-lytical ability of individuals so that they take intelligent business decisions. All these programmes aimed at person-ality development are conducted by special experts who come from differ-ent parts of the country. SCMS has an annual budget of Rs 1.5 crore for this purpose.

To further extend its social re-sponsibility, SCMS has established a charity foundation, the ‘G P C Nayar Foundation’, with an initial corpus of Rs 1.5 crore for offering scholarships to financially poor students who join in-stitutions under the SCMS Group.SC-MS-COCHIN offers MBA-equivalent

PGDM, and one-year postgraduate diplomas, recog-nized by the Ker-ala Government, in Marketing Man-agement, Human M a n a g e m e n t , Materials Manage-ment, International Management, For-eign Trade Management, Public Rela-tions, Advertising and Journalism.

The other institutes that constitute the group are SSET-Cochin (SCMS School of Engineering & Technol-ogy); SSTM-Cochin (SCMS School of Technology & Management) offering MBA and MCA; SSET Bioscience and Technology Division SCRCT-Cochin (SCMS Centre for Research, Consul-tancy and Training); NSIPADS-Cochin (NORKA-SCMS Institute for Paramed-ical and Development Studies); SSHM & CT-Cochin (SCMS School of Hotel Management & Catering Technology); SAAMS-Bangalore (SCMS Academy for Animation and Media Studies); SSIS-Cochin (SCMS School of Inter-national Studies) and SCMS-Cochin Trivandrum Centre.

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SCMS—institute looked upon with awe

Academic complex on Smart City campusThe SCMS Group plans to develop an academic complex on Smart City campus at Kakkanad in Kochi with an investment of Rs 150 crore, says Group Chairman G P C Nayar. The project will be unveiled at the “Emergingh Kerala’ event in Kochi.

“The Kakkanad region has about 50,000 people working in various industries and the number is expected to touch 4.5 lakh by 2020. SCMS will render state-of-the-art academic service to the working executives of this fast-devel-oping information technology hub of Kerala,” says Dr Nayar.

The plan is to start a higher secondary school and a management and tech-nology training institute to cater to the children of the executives working in Smart City. The first phase of the project will be complete by 2016.

Dr G P C Nayar

39


38


40


At a time when others were afraid to tread the path of en-

trepreneurship, Dr A R Babu chose to think differently and act differently. He knew that a clear vision, sustained per-formance and a commitment to quality would always bear fruit.

Barely three decades ago, vir-tually every fresh graduate in Kerala had two options: they could either join engineering or they could end up being a doc-tor. Yet Babu, son of Aliyaru Kunju,

chose to take an offbeat path when Kerala was caught up in powerful trade union struggles and people were more concerned with their rights than their duties.

Born in 1954 at Nedumangad, Thiruvananthapuram, young Babu had an inclination towards entrepreneur-ship from a young age. When a rela-tive of his prompted him to visit Goa, Babu knew instinctively where he had to start work.

Back in the 1990s life was diffi-cult for a fledgling entrepreneur. The economy of the country was changing and there was a real threat of new en-trepreneurs losing their battle to multi-national giants. No more did the Gov-ernment protect the entrepreneurs. Running a business was a risky propo-

sition. But Babu persisted. In 1983, he started Heera Construction Co with an office at Panaji, the capital of Goa, as a contracting firm. A decade later, he expanded his operations to other capi-tal cities of states, like Kerala’s Thiru-vananthapuram.

The Heera Group has seen steady growth. Dr Babu attributes this to the three pillars of his business—quality, economy and comfort. It is this thrust to quality that has made Heera a house-hold name, quite literally. The projects formulated by him are known for their meticulous planning and rigorous qual-ity control and, because of this, most of them are completed ahead of sched-ule. With more than 100 lakh square feet of built-up area to its credit, the Heera Group is now one of the most reputed builders in South India.

With rising reputation, expecta-tions about new projects have also increased, and pressure is on to build better and superior structures. And Heera does not disappoint these ex-pectations. It has to its credit more than 5,000 happy families residing in proj-ects spread over three major cities of Kerala—Thiruvananthapuram, Kochi and Kottayam. No wonder that with such growing reputation, Heera faced little trouble even during the recession period when most builders had to com-pletely stall new projects. But Heera in fact added eight more projects to its kit and sold 70-80 units every month in 2010.

With the able leadership of Dr Babu, his company achieved the rare recog-nition of earning a Seven Star rating from Crisil for its prestigious Heera In-focity project, near Technopark, Thiru-vananthapuram. The ratings take into account the quality of construction, le-gal quality, financial quality, innovation and sponsorship.

With such tremendous growth, how does Dr Babu manage to steer Heera? The answer lies in his words: “We should be able to change with circum-stances”.

And, true to his word, he makes it a point to update himself with the latest trends in the industry. He is very par-ticular about adapting the latest inno-vation to his projects way before other builders take it up as industry stan-dards. “If you take a decision, stick to it and be ready to follow it through. This is the only way to win,” he says.

Proving its commitment to quality, leadership, technology and innovation, Heera Constructions won the world-renowned Century International Qual-ity Era Award in the Gold Category for 2012 at the International Convention held on March 11, 2012 by Business Initiative Directions (BID). Dr Babu, Managing Director of Heera, received the award from Mr Jose E Prieito, Pres-ident of Business Initiative Directions (BID), Spain, at a glittering ceremony in Geneva, Switzerland, that included around 90 industrialists and business leaders from across the world.

The award was presented based on the s u c c e s s f u l implementa-tion of seven principles of the QC 100 Total Qual-ity Management Model, according to which quality is a consequence of valuing customer sat-

isfaction and obtaining positive busi-ness results.

Some of the other recipients of the award from India are ICICI Bank, NTPC Ltd and NCR Corporation India Private Limited. Indian Oil Corporation (IOC), Coal India Ltd, Reliance Infra-structure Ltd and Tata Group Ltd were some of the winners of the Century International Quality Era Award (CQE) in 2011.

Heera: adept in innovative building

SNGCE: creating next-gen engg leaders

T A Vijayan

Sree Narayana Gurukulam College of Engi-neering (SNGCE) is designed to educate the

next generation of engineering leaders to analyse and solve complex problems of impor-tance to society, to collaborate as productive team members, to engage in life-long learning and to practise professionally and ethically.

SNGCE was established in 2002 by the Kunnathunadu SNDP Union, headquartered

at Perumbavoor, to accomplish the ideals of Sree Narayana Guru, the great philosopher, social re-former and scholar. The functioning of the institution is steered by the Sree Narayana Gurukulam Trust which is committed to providing world-class facilities to the up-and-coming technocrats. The members

Dr A R Babu receiving the Seven Star rating from Crisil for its prestigious Heera Infocity project, near Tech-nopark, Thiruvananthapuram.

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Dr A R Babu

of the trust hail from various professional fields, and they have a set objective of opening avenues to the youth in world-class higher education in engineering and technology and in allied disciplines.

The college has been approved by the All-India Council for Technical Education (AICTE) and is af-filiated to M G University. It has separate hostels for gents and ladies. The ladies’ hostel is located within the campus.

SNGCE continually works to engage the students, faculty and staff in the integration, creation and dis-semination of technical knowledge through teamwork and personalized instruction. Hi-tech laboratories for

different departments, personality development pro-grammes and meditation classes are its attractions.. SNGCE had enhanced its MBA seats from 60 to 120 last year and has added one more MBA batch this year. The college has inducted MTech courses in three streams. A total of 228 students got employment by placement service last year. This year witnessed 158 students getting jobs through placement.

SNGCE has other special features like selection based on merit only, industry-integrated curriculum, Wi-Fi connectivity inside the campus, intelligent cam-pus, digital library with international journals, intern-ship in industry and industry-based projects, excel-lent facility for sports and games and an environment conducive to literary and arts talents.

The college envisages more courses in computer science and electrical engineering in future, says Mr T A Vijayan, Executive Director.

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With over one decade of experience in the con-struction field Uni Homes promoted by Unit-

ed Realtors has successfully completed a number of prestigious projects in Kochi. The latest among them is Uni Residenz located in the heart of Kochi city in an affluent residential area at Judges Avenue, Kaloor, with luxurious amenities like swimming pool, home theatre and health club plus other hi-tech facilities present-day residents crave. The location itself gives residents easy access to transportation, the upcoming metro rail, supermarkets, hotels, hospitals, colleges, schools and various public and private establishments. Uni Resi-denz has 2/3/4-bedroom apartments in G+11 floors and luxurious penthouse and personal balcony which makes way for waking up to happy mornings and har-monious living for children, adults and seniors alike.

Uni Midtown is an ongoing proj-ect of Uni Homes at Aluva. Just as its name denotes, Uni Midtown is majestically located in the very heart of the town. It is an apartment complex elegantly built in G+12 floors, and offers the best ambience for a happy and harmonious living. Uni Midtown consists of 33 three-bedroom apartments. All modern facilities like swimming pool and health club are incorporated in this project. Uni Midtown’s uniqueness lies in its location which offers easy access to all avenues of life. It is lo-cated just 200 metres from the Na-tional Highway and 20 metres from the main road. The unique design of each apartment is guaranteed to make you feel at home.

The company’s accomplish-ment in this field is due to its strong policy of strictly following its com-mitments to using quality materials supplied direct from the factory, adhering to the best construction practices, innovative designs, choice of excellent locations and

using a very skilled and experienced workforce for the timely completion of its projects.

Uni Homes’ other projects are River Heights and Uni Square (a completed commercial project) in Kochi. River Heights with 58 flats provides a distinguished status for the owners. It has everything that human be-ings long for in life. Uni Homes is proud to claim that it has an array of happy and satisfied customers who will remain steadfast friends for ever with a team of profes-sionals who have combined their business ethics and other essential skills. Uni Homes’ industrial and com-mercial projects match their home projects.

Educational qualification, knowledge and experi-ence make one a professional and work perfectly. Both these qualities mingle in the promoters of Uni Homes,

Uni Homes for grandiose living in the heart of city

M A Rafeeq

L Murugan

C V Jayalal

managed by its two Managing Partners, Mr M A Rafeeq and Mr L Murugan. Mr Murugan and Mr Rafeeq are basically Chartered Accountants by profession. Mr Rafeeq’s father is an Advocate and was also a Government contractor. Mr Murugan’s father was a textile businessman. Mr Rafeeq and

Mr Murugan have been together since their school days in Aluva. Mr C V Jayalal who is also a Partner in Uni Homes has various other business interests and is also a Director of the company which manu-factures the famous Aqua Tech Water Tanks.

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PASSLINE Sept 30 - Oct 31, 2012 RN 65561/94 Reg. No. KL/EKM/116/2009-2011

Printed and Edited by Varghese Paul for Keethara Publications Pvt Ltd. 6802, Convent Road, Kochi-35 Tel 3043572 Email:[email protected] and Printed at Ayodhya Printers Pvt Ltd., Cochin-26 Design by Unnikrishnan

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Documents

Passline Business Magazine October 2012