Archiv der Kategorie: Indian Economy – Miscl. News

Airbus sees India in need of over 1,040 aircraft worth US$145 billion in next 20 years

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Airbus says: „India needs over 1,040 aircraft worth US$145 billion in next 20 years“ and sees demand for larger eco-efficient aircraft

15 March 2012 Press Release

According to Airbus’ latest market forecast, Indian carriers will require 1,043 new passenger (1,020) and freighter (23) aircraft valued at US$145 billion between now and 2030 to satisfy surging annual demand. India’s market for new aircraft makes it the world’s fourth largest in both number of aircraft and value.

Indian annual passenger traffic growth rates of 7.2 per cent are well above the regional Asia Pacific average growth rate of 5.9 per cent and the world average 4.8 per cent.

Of the requirement for 1,020 new passenger aircraft, some 860 will be for growth and 160 to replace the eldest aircraft in the existing fleet of 327. By 2030, this means that India’s passenger fleet will more than triple to some 1,180 aircraft. The new passenger aircraft include 646 single aisles like the A320 and A320neo Family, 308 twin aisles like the A350 XWB and A330, and 66 very large aircraft such as the A380.

Growing urbanization and population concentrations combined with a growing middle class and dynamic economic growth are driving demand and this trend is expected to continue. Despite near term challenges, the Indian economy is forecast to continue expanding, helping India’s growth in domestic air travel to reach even higher growth rates of nearly 10 per cent annually, making it one of the fastest growing aviation markets anywhere in the world.

“By 2030, India’s economy is forecast to be the fourth largest in the world creating exceptional potential for growth in the aviation sector. Through our Indian industrial partnerships we are proud to boast that every A320 today is partly made in India,” said Dr. Kiran Rao, Airbus Executive Vice President, Sales and Marketing, and President of Airbus India. “Our engineering and industrial footprint in India supports over 2,000 highly skilled Indian jobs throughout our supply chain, and this figure is growing.”

Airbus’ partnership with India dates back almost 40 years. Today, half of all A320 forward doors and all flap track beams are produced in India. Established in 2006, the Airbus Engineering Centre India (AECI) in Bangalore employs over 270 highly skilled local engineers working in high end analysis and design on all Airbus products. The centre is expected to grow to 450 over the next three years. Airbus recently established a second pilot training centre in Noida (this one in cooperation with CAE and Interglobe) to complement the existing facility in Bangalore. Combined, they will have the capacity to train up to 5,000 pilots and maintenance engineers per year. Airbus’ market share of new aircraft orders in India is over 70 per cent.

Source: Airbus‘ Press Release, dated: 15.03.2012.

India’s new budget proposes new tax slabs, more expenditure on education

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Frugal Innovations for the ‘Unserved’ Customer: An Assessment of India’s Attractiveness as a Lead Market for Cost-effective Products

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New publication from the Institute for Technology and Innovation Management, Hamburg University of Technology (TUHH)

Title: Frugal Innovations for the ‘Unserved’ Customer: An Assessment of India’s Attractiveness as a Lead Market for Cost-effective Products
Authored by: Rajnish Tiwari and Cornelius Herstatt
Publication date: March 2012
Download: http://www.global-innovation.net/publications/PDF/Working_Paper_69.pdf

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Abstract

This study builds on the authors‘ previous work, which had questioned the validity of certain assumptions of the lead market theory in the face of changing ground realities in a globalized world. Sustained economic growth and proven technological capabilities in some “emerging economies” like China and India call for a reassessment of the appropriateness of the “conventional wisdom” that had held true until recently. While our previous study had built a theoretical background the lead market model by introducing new elements, and doing away with certain others, with the help of two in-depth case studies, the purpose of the present study is to specifically assess India’s potential as a lead market for cost-effective frugal innovations.

The study crystallizes the inherent characteristics of frugal innovations, their development process and market success in the domestic and overseas markets by analyzing four successful product innovations from selected industries in India. The factors identified thus are then incorporated in the theoretic model to derive propositions about India’s lead market potential. Whereas affordability and economies of scale have traditionally constituted the primary concern for frugal innovations, an increasing shift towards “value proposition” is identified. Intensifying competition and growing customer aspirations are changing the nature of frugal innovations. The hitherto unserved customer demands attractive designs and modern technologies to come out of his shell of “non-consumption”. Our research confirms that frugal innovations can benefit end-consumers and firms, simultaneously. Better-designed products also have positive impact on the lead market potential, creating a virtuous cycle. The study also discovered that the increasing need for sophistication coupled with continued cost pressures is shifting the product development processes into the domain of “open global innovation”, which also helps reduce the negative country-of-origin effects faced by developing countries. The research would have implications for location decisions in setting up global innovation/R&D activities.

Keywords: Lead Markets; Frugal Innovations; India; Bottom of the Pyramid; Global Innovation; Open Innovation; Emerging Economies.

The Hindu Business Line recommends reading „GIRT“ article

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In an article titled „The horizon vocabulary“ journalist D. Murali of The Hindu Business Line, a renowned newspaper from India, recommends reading an article („Investment Destination Germany: Chances & Challenges for Indian Firms„) written by Rajnish Tiwari, Head of German-Indian Round Table in Hamburg:

Investment opportunities in Germany

In a significant contrast to their Chinese counterparts, Indian firms have so far tended to prefer developed Western countries for their investments, notes Rajnish Tiwari, Head of the German-Indian Round Table (GIRT) in Hamburg. Germany, along with the US and the UK, has emerged as a primary target for Indian FDI, he adds, in Investment destination Germany: Chances & challenges for Indian firms (www.ssrn.com). “With its established technological prowess, high-quality infrastructure and reliable institutional set-up, Germany is regarded as an excellent investment target by many Indian firms in their pursuit of newest technologies and commercially viable cutting-edge innovations,” Tiwari reasons.

The paper concedes that, since many Indian companies prefer to channelise their FDI projects to Germany through their existing domestic subsidiaries or through their daughter concerns in other European countries, the official data fail to capture the true extent of Indian engagement in Germany.

Tiwari urges Indian firms, therefore, to take advantage of Germany’s excellent physical infrastructure and technological know-how, including in the eastern part, while combining it with their own strengths in production, marketing, low-cost engineering, and business model innovations. Provides pointers that you may like to explore in detail.

Source: The Hindu Business Line, 11.02.2012

Direct link to the paper in question:
http://www.global-innovation.net/team/tiwari/PDF/Tiwari_BusinessGuide_2011.pdf

Book Review: The Rise of Indian Multinationals: Perspective of Indian Outward Foreign Direct Investment

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In its publication „Reserve Bank of India Occasional Papers“ (Vol. 32. No. 1, Summer 2011) India’s central bank has published a review of the book „The Rise of Indian multinationals: Perspective of Indian Outward Foreign Direct Investment“, edited by Karl P. Sauvant and Jaya Prakash Pradhan with Ayesha Chatterjee and Brian Harley (Palgrave MacMillan: New York), 2010; pp 284, £90.

The review also includes a chapter on Indian investments in Germany. The reviewer Arvind K. Jha (Assistant Adviser, Department of Economic and Policy Research, Reserve Bank of India, Mumbai) writes:

„Chapter 8 on ‘The Emergence of Indian Multinationals: An Empirical Study of Motives, Current Status, and Trends of Indian Investment in Germany’, by Rajnish Tiwari and Cornelius Herstatt, presents the results of a empirical survey conducted among Indian subsidiaries operating in Germany. Survey brings out the fact that the majority of Indian companies investing in Germany are from service sectors like software and IT industry (more than half of Indian companies), pharmaceuticals and the automotive industry. Important factors behind the Indian OFDI to Germany are long tradition of economic relations between these two countries, proximity to their customers and suppliers, large access to German market and availability of skilled labour. Another interesting finding of this survey study is that Indian MNEs are net job creators in the Germany. The study also finds that Indian subsidiaries have generally performed well and look forward to strengthen their operational presence in Germany, including research and development activities. However, the survey also highlights the challenges, including cross-cultural issues, being faced by Indian MNEs in Germany.“

Source: Reserve Bank of India
http://www.rbi.org.in/scripts/bs_viewcontent.aspx?Id=2490