The Most Bribed city in India

Bangalore is the most bribed city in India!!

According to statistics released by iPaidabribe.com, Bangalore comes out on top as the most bribed city in India. This is quite a surprising statistic, as one may have thought it would be either of the two metros, Delhi or Mumbai, who would witness maximum amount of corruption!

iPaidabribe.com, is an initiative by Janagraha, encourages Indians to disclose the bribes they pay to anyone. One of the reasons why the finding may be skewed is because it is prepared based on the what people from various cities have disclosed on the website. Bangalore being an IT hub, maximum number of people have made entries from that city and hence the number 1 position. Bangaloreans are at the forefront when it comes to paying bribe to evade a challan for illegal parking; On an average, Bangaloreans pay Rs 378 as bribe to evade an illegal parking ticket. Delhi came second with Rs 350.

Although, the city statistic may be skewed, the report has some interesting finding about the Government departments that lead in taking bribes – Police is by far the most bribed department. Over Rs. 3 Crore of bribes were accepted by Police officials in 5705 instances. Police department was followed by registrations, Municipal Corporations & Vehicle as the next 3 departments who accepted maximum bribes.

You can check out the entire interactive report by ipadabribe.com . Also, if you have paid a bribe, do not hesitate to send a sms or go to their website to disclose the same.

Here is a question to readers, which city do you think is the most bribed city in India – My vote would go to Chennai, what about you?

India's pharmaceutical sector - A Complete Study

India's pharmaceutical sector is gaining its position as a global leader. The pharma market in India is expected to touch US$ 74 billion in sales by 2020 from the current US$ 11 billion, according to a PricewaterhouseCoopers (PwC) report.

Growth of Indian pharma companies will be driven by the fastest growing molecules in the diabetes, skincare and eye care segment, as per a report by research firm, Credit Suisse. The market share of a drug company is directly related to the number of fast growing molecules in the company's pipeline, the report highlighted.

The Indian pharmaceutical market is poised to grow to US$ 55 billion by 2020 from the 2009 levels of US$ 12.6 billion, as per a McKinsey & Company report titled "India Pharma 2020: Propelling access and acceptance realising true potential". The industry further holds potential to reach US$ 70 billion, at a compound annual growth rate (CAGR) of 17 per cent.

Sector Structure/ Market Size

The Indian pharmaceutical market is expected to grow at a CAGR of 15.3 per cent during 2011-12 to 2013-14, according to a Barclays Capital Equity Research report on India Healthcare & Pharmaceuticals.

The outlook on the Indian pharmaceutical industry remains favourable, according to a report by ICRA and Moody's. Domestic formulation market stood at Rs 58,300 crore (US$ 10.54 billion) and has been ranked third in terms of volume and tenth in terms of value, globally. From 2011, trends are changing, MNCs are focusing on chronics, branded generics and launching patented products, besides expanding their field force and focusing on tier-II as well as tier-IV towns. Domestic market grew at 15 per cent, while pharma multinational companies (MNCs) revenue grew at 18.7 per cent.

Exports

India's exports of drugs, pharmaceutical and fine chemicals grew by 27 per cent to Rs 60,000 crore (US$ 10.85 billion) for the year ended March 2012, according to data compiled by Pharmaceutical Exports Council of India (Pharmexcil). Moreover, the size of the Indian formulations market, which currently stands at around Rs 62,000 crore (US$ 11.21 billion), is growing at 15-20 per cent annually.

"India-Brazil health and pharmaceutical collaboration holds the potential of being key contributor for assuring affordable healthcare for our people," as per Mr Anand Sharma, Union Minister for Commerce, Industry and Textiles. Mr Sharma further called for better understanding between the pharmaceutical regulatory regimes in the two countries.

The Export-Import (Exim) Bank of India has agreed to provide loans to fund the setting up of common infrastructure facilities at Sriperumbudur, Tamil Nadu, which will help boost exports of medicine products from India.

Growth

India will see the largest number of merger and acquisitions (M&As) in the pharmaceutical and healthcare sector, according to consulting firm Grant Thornton. A survey conducted across 100 companies has revealed that one-fourth of the respondents were optimistic about acquisitions in the pharmaceutical sector.

The cumulative drugs and pharmaceuticals sector attracted foreign direct investments (FDI) worth US$ 9,596 million between April 2000 to May 2012, according to the latest data published by Department of Industrial Policy and Promotion (DIPP).

Generics

India tops the world in exporting generic medicines worth US$ 11 billion. Currently, the Indian pharmaceutical industry is one of the world's largest and most developed, according to Mr Srikant Kumar Jena, Union Minister of State for Chemicals and Fertilisers.

Generics will continue to dominate the market while patent-protected products are likely to constitute 10 per cent of the pie till 2015, according to McKinsey report 'India Pharma 2015 - Unlocking the potential of Indian Pharmaceuticals market'. Hyderabad-based generic drug maker, Natco Pharma Ltd has launched a cheaper generic version of Bristol Myers Squibb's blood cancer drug Sprycel at a fraction of the innovator pricing. Natco launched Dasatinib at a pricing of Rs 9,000 (US$ 162.75) for a month's supply against Bristol pricing of around Rs 160,000 (US$ 2,893.31).

Multinational drug companies are showing a healthy growth in the Indian market setting a new trend. Out of 25 top medicine brands by sales last year, 13 were global drug major such as Pfizer, GSK and Novartis. Brand-building exercise is fast becoming more evident in a predominantly generic Indian medicine market, as per a market research entity AIOCD AWACS' report.

Diagnostics Outsourcing/ Clinical Trials

"The Indian healthcare devices market is part of our focus on emerging markets. The Hyderabad centre will enable us to improve product time to market and create valued-innovation," highlighted Robert Frechette, Vice-President (Engineering Services), Covidien. The value of the Indian medical devices market is estimated at US$ 4 billion, and is clocking a growth rate of 15 per cent annually, he added.

The Indian pharmaceutical companies can be of immense value in providing affordable healthcare, especially in countries such as Japan. India also has a vast pool of trained pharmaceutical scientists, doctors and researchers, which opens up avenues for joint collaborative research for new drug discoveries along with joint intellectual property rights (IPRs).

The clinical pharmacology unit of GVK Biosciences at Ahmedabad has cleared an audit conducted by US Food and Drug Administration (FDA). The facility carries out important scientific studies related to drug development for pharma customers (drug companies, research institutes, etc).

Investments

• Suven Life Sciences Ltd has got four product patents one each from Australia, Canada, Korea and New Zealand for their new drug molecules (New Chemical Entities). The new drug molecules are used for disorder treatment related to Neuro-degenerative diseases
• Aurobindo Pharma has received USFDA approval to manufacture and market montelukast sodium tablets and montelukast sodium chewable tablets for treatment of asthma in the US market
• US-based drug development player, CritiTech Inc has joined hands with Hyderabad-based formulation development services company, Finoso Pharma Pvt Ltd to set up a 50:50 joint venture (JV) - Finotech Pharma. The JV company is being set up with an initial investment of US$ 1 million
• Venus Remedies has secured its third US patent for its novel antibiotic product Potentox. The new drug is an antibiotic adjuvant entity and is considered effective in case of hospital acquired pneumonia and febrile neutropenia infections
• Israel's Teva Pharmaceutical Industries and Procter & Gamble (P&G) plan to enter India through a joint venture (JV) by setting up their first manufacturing facility at Sanand, Gujarat, with an initial investment of Rs 250 crore (US$ 45.21 million)
• Onco Therapies, a wholly owned subsidiary of Strides Arcolab, has received two USFDA approvals for 'Fluorouracil Injection USP'. Fluorouracil is a chemotherapy drug which interferes with cells making DNA and RNA, and stops the growth of cancer cells
• Mankind Pharma Ltd is set for a major turnaround over the next two to three years. "We are planning to launch 15-16 products in the chronic therapy segment this financial year", as per R C Juneja, CEO and Chairman, Mankind Pharma
• Venus Remedies Ltd has launched a nanotechnology based 'ready-to-use' single vial Docetaxel in the domestic market. The medicine will be an important tool in the cancer drug industry

Government Initiatives

The Union Budget for 2012-13 was announced by Mr Pranab Mukherjee, the Union Finance Minister. Highlights of Union Budget 2012-13:

• It is proposed to extend concessional basic customs duty of 5 per cent with full exemption from excise duty/CVD to six specified life-saving drugs/ vaccines. These are used for the treatment or prevention of ailments such as HIV-AIDS, renal cancer, etc
• Probiotics are a cost-effective means of combating bacterial infections. It is proposed to reduce the basic customs duty on this item from 10 per cent to 5 per cent
• Basic customs duty and excise duty reduced on Soya products to address protein deficiency among women and children. Basic customs duty and excise duty reduced on Iodine

Furthermore, a 'Pharma Vision 2020' has been prepared by the Department of Pharmaceuticals, for making India one of the leading destinations for end-to-end drug discovery and innovation and for that purpose, the department will provide requisite support by way of world class infrastructure, internationally competitive scientific manpower for pharma research and development (R&D), venture fund for research in the public and private domain and such other measures.

Road Ahead

On the back of increasing middle-class population base, improvements in medical infrastructure and the establishment of IP rights, the Indian pharma industry is estimated to grow manifolds.

"India is a unique market, always very intriguing. India presents challenging paradigms and gives tremendous opportunities. I see the healthcare sector as one of the biggest business opportunities," as per Terri Bresenham, President and CEO, GE Healthcare India, and MD, Wipro GE Healthcare. India is the first country to have a large number of multinational healthcare providers, added Bresenham.

Pharmaceutical companies such as Cipla, Ranbaxy, Dr Reddy's Labs and Lupin might soon be part of the government's ambitious 'Jan Aushadhi' project. In an attempt to commercialise the project, the government is likely to rope in the private sector to bulk-procure generic drugs from them. There are 117 Jan Aushadhi stores across the country and the plan is to expand to at least 600 in the next two years and 3,000 by 2016.

Exchange rate used INR 1= US$ 0.01808 as on August, 2012

References: Consolidated FDI Policy, Department of Industrial Policy & Promotion (DIPP), Press Information Bureau (PIB), Media Reports, McKinsey Report, Pharmaceuticals Export Promotion Council

India is the third least honest nation

India is Third least honest nation on the Internet 

[India Cybercrime report]

According to latest Norton Cybercrime report – India is the third least honest nation on the Internet, with over half of adults saying they have lied on the internet.

One of the most significant finding of this report that is that 3 out 4 netizens have fallen to trap to some form of cybercrime (76%) – majority of them due to virus & malware attacks. That is above 10% above global average as well!

What is most surprising is even with above average levels of cybercrime in India, adults here have the strongest belief that cyber criminals will be brought to justice – In fact, they are most optimistic about it compared to their peers globally.

Interesting findings of Norton Cybercrime Report

• 8% Indians do not expect to be cyber-crime victims ever as compared to 3% globally and 10% Indians feel that they are completely safe online.
• 57% Indians feel that cyber criminals will NOT be brought to justice as compared to 79% globally.
• Once an individual has fallen prey to cybercrime, 58% of them change the way they conduct themselves online while very few individuals call Police or Banks to ensure safety!
• It takes average of 44 days and Rs. 5262 to resolve a cybercrime in India, while globally the average is 28 days and over USD 334 (Rs. 13500 approx.) !
• 55% of Indian online users have lied about their personal details as compared to 45% globally. 36% Indians have used fake online IDs (33% globally)
• 19% of Indian regret as to what they have done previously online and 41% believe that once your online reputation is ruined, nothing can be done about it.

There are 3 simple rules to follow which should help majority of cyber criminals to stay away –

• Never give out your passwords
• Keep your financial details safe and
• don’t open email / links from people you don’t know

Indian Insurance Industry: An Outlook

Insurance industry in India - Brief Introduction

The Indian insurance sector has witnessed significant growth - the number of life policies in force has increased nearly 12-fold over 2000-2010, and health insurance policies nearly 25-fold. Factors like better terms, availability of a wide variety of products (like unit-linked insurance products, whole life, maximum net asset value (NAV) guarantee etc), and government incentives have boosted the growth of the industry.

Data released by the Insurance Regulatory and Development Authority (IRDA) indicates that 23 life insurers registered Rs 18,282.86 crore (US$ 4.1 billion) by writing new policies during April-June 2011. State-owned Life Insurance Corporation (LIC) of India, collected premiums worth about Rs 13,341.97 crore (US$ 3 billion), while its private peers collected 4,940.89 crore (US$ 1.1 billion) as new first-year premium during the period.

In June 2011, industry collection stood at Rs 6,022.98 crore (US$ 1.35 billion). Revenue earned by selling new policies increased by 15.13 per cent in FY11, amounting to Rs 1,25,826.03 crore (US$ 28.24 billion) against 1,09,290.38 crore (US$ 24.53 billion) in FY10.

Insurance in India - Market Dynamics

Currently, the insurance industry, including life and non-life companies, has deployed a capital of about Rs 35,000 crore (US$ 7.8 billion) out of which Rs 26,000 crore (US$ 5.8 billion) comes from the life insurance segment. Foreign players have contributed about Rs 9,000 crore (US$ 2 billion).

General Insurance

The General insurance industry registered 22.35 per cent growth during the first quarter (April-June) of FY12 in terms of gross written premium.

Public sector player New India Assurance Ltd. grew 15.97 per cent during the first quarter of FY12 by collecting US$ 520 million through new policies.

Health Insurance

The second largest vertical under non-life insurance umbrella, health insurance is witnessing significant growth from the last two fiscals. The growth in premium is expected to continue at a compound annual growth rate (CAGR) of around 28.5 per cent during FY12-FY14. Rising healthcare costs and awareness, along with government support and incentives have attracted many private players in the sector. The huge demand supply gap in the industry provides large scope of growth and progress in the coming years.

Private and public players witnessed an increase of 33 per cent in terms of gross health insurance premium collected for FY11. Increase of insurance premium rates (in both retail and group insurance segments) by almost 30 per cent in last couple of years has boosted the industry growth, according to Sanjay Datta, Head of customer service for health and accidents, ICICI Lombard. Further, government-endorsed insurance schemes like Rashtriya Swasthya Bima Yojana and support from state governments have strengthened premium collections in the sector, as per Virendra Kumar, General Manager, health insurance, New India Assurance.

Indian Insurance Sector - Key Investments

• Hewlett-Packard (HP) owned IT services company Mphasis has acquired US-based software vendor Wyde Corporation. With this acquisition, Mphasis intends to align its applications and business process outsourcing (BPO) operations with Wyde’s insurance software platform Wynsure. The acquisition is the second one in insurance segment by Mphasis, which bought AIG’s captive unit in India in 2009.
• The Competition Commission of India (CCI) has given its nod to Reliance Industries Ltd. (RIL) to buy Bharti Group’s 74 per cent stake in each of Bharti AXA life and general insurance companies. Bharti Enterprises and French insurer AXA Group were in 74:26 joint venture (JV). While RIL will acquire 57 per cent of the pie, Reliance Industrial Infrastructure Ltd (RIIL) will buy the remaining 17 per cent held by Bharti in the two companies.
• India’s second largest public sector lender Punjab National Bank (PNB) is set to form a strategic alliance with insurance firm Metlife for its proposed life insurance business, wherein the bank would buy 30 per cent stake for an undisclosed amount. PNB also agreed to enter into a 10-year distribution tie-up with Metlife India. The deal is expected to close by the end of 2011.
• Cigna Corporation, American health insurance major, is planning to form a Joint Venture (JV) with an Indian company by August 2011 to mark its presence in the country's fast-growing health insurance sector.

Government Initiatives

IRDA has recently hinted at mandatory listing of insurance companies. Though the insurance Act doesn’t stipulate companies to go public, the regulator might make amendments to it to facilitate capital raising by the players. Initial Public Offer (IPO) guidelines for the insurance sector are also being worked upon. According to the draft guidelines released, only those players that have 10 years of operational experience and strong financial performance would be allowed access to the capital markets.

IRDA has also announced the release of much-awaited health insurance portability scheme across non-life insurance companies to be done on October 1, 2011. The proposed scheme would give policyholders discretion of moving to other insurer of their choice, whom they think is providing better product and service, while continuing with their policies. The launch of the scheme has been postponed from July 1 to October 1 so that the insurers are completely prepared to adopt the new concept.

Paving way for consolidation in general insurance sector, IRDA has notified merger & acquisition (M&A) guidelines for the players. The IRDA Scheme of Amalgamation and Transfer of General Insurance Business Regulations-2011 would apply with immediate effect to all private general insurance companies. Along with IRDA, the buyer would be mandated to receive nods from the Reserve Bank of India (RBI) and finance ministry, in case foreign direct investment (FDI) is involved. It would also require having approvals from the Securities and Exchange Board of India (SEBI) and CCI.

To improve the level of penetration in Indian markets, the sector regulator is contemplating allowing banks to sell products of two insurance companies each in life and non-life categories. The recommendation over bancassurance for such a move was made by a committee set up by IRDA itself. As per the current practice, a bank is allowed to sell products of one each in a life insurance company, a general and a health insurance firm.

Insurance in India - Road Ahead

India’s insurance industry is anticipated to reach US$ 350-400 billion in terms of premium income by 2020, making it among the top three life insurance markets, according to a report by a leading industry body and US-based Boston Consulting Group (BCG). India is expected to be one of the top 15 non-life insurance markets by 2020. The report further stated that penetration of the insurance industry, premium as percentage of the country's gross domestic product (GDP), has improved from 2.3 per cent in 2001 to 5.2 per cent in 2011.

(Exchange Rate Used: INR 1 = US$ 0.02244165 as on August 4, 2011)

References: IRDA publications, IBEF,press reports, media releases

Software Piracy and India

Software Piracy causes USD 866 mln loss to Indian Govt.!

India is one of the leading countries in Software Piracy – Even today over 65% of Indians use pirated software on daily basis. Although, the rate of software piracy is coming down, it still is at a level where it causes Billions of dollars of losses to Software Manufacturers.

According to a recently released report by Business Software Alliance (BSA) , the commercial value of unlicensed software installed on personal computers in India touched USD 2.739 billion in 2010, whereas the global losses stood at USD 59 billion.

Now, some of you may be wondering – How does software piracy cause losses to Government ? It is basically in form of taxes which government pockets when a genuine software is sold – And taxes are quite steep for all software.

The BSA report pegs the losses caused due to pirated software to Government exchequer (in 2009) are US $866 million in net taxes, both indirect and direct.

Affects of Software Piracy in India

According to IDC estimates (in 2009), the software piracy in India caused:

• Loss of commercial value of unlicensed software totalled over US$2.27 billion causing the domestic economy to lose US$5.3 billion of software, services and channels revenues to software piracy.
• Consequently, the state exchequer tax receipts loss was roughly US$866 million at the current piracy and employment levels, as the industry lost its otherwise legitimate share of revenues to pirates.
• The indirect tax receipts would have contributed US$553 million from software (media and paper licenses) and services-related business transactions and direct tax receipts would be around US$313 million for the Indian economy.

The report goes on to suggest various measures that could be taken up to curb piracy in India, which includes amending laws to classify software piracy as a form of tax evasion.

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INDIA: Tourism and hospitality

Tourism and hospitality

As per the Travel and Tourism Competitiveness Report 2009 by the World Economic Forum, India is ranked 11th in the Asia Pacific region and 62nd overall, moving up three places on the list of the world's attractive destinations. It is ranked the 14th best tourist destination for its natural resources and 24th for its cultural resources, with many World Heritage sites, both natural and cultural, rich fauna, and strong creative industries in the country. India also bagged 37th rank for its air transport network. The India travel and tourism industry ranked 5th in the long-term (10-year) growth and is expected to be the second largest employer in the world by 2019.

Contribution to the economy

Combining unparalleled growth prospects and unlimited business potential, the industry is certainly on the foyer towards being a key player in the nation's changing face. Furthermore, banking on the government’s initiative of upgrading and expanding the country’s infrastructure like airports, national highways etc, the tourism and hospitality industry is bound to get a bounce in its growth.

The hotel and tourism industry’s contribution to the Indian economy by way of foreign direct investments (FDI) inflows were pegged at US$ 2.24 billion from April 2000 to November 2010, according to the Department of Industrial Policy and Promotion (DIPP).

India’s hotel pipeline is the second largest in the Asia-Pacific region according to Jan Smits, Regional Managing Director, InterContinental Hotels Group (IHG) Asia Australasia. He added that the Indian hospitality industry is projected to grow at a rate of 8.8 per cent during 2007-16, placing India as the second-fastest growing tourism market in the world. Initiatives like massive investment in hotel infrastructure and open-sky policies made by the government are all aimed at propelling growth in the hospitality sector.

Foreign Tourist Arrivals

Ministry of Tourism compiles monthly estimates of Foreign Tourist Arrivals (FTAs) in India and Foreign Exchange Earnings (FEE) from tourism on the basis of data received from major airports. Following are the important highlights, as regards these two important indicators of tourism sector for 2010 and December 2010.

• FTAs in India during 2010 were 5.58 million with a growth rate of 9.3 per cent as compared to the FTAs of 5.11 million during 2009.
• FTAs during the December 2010 was 6,55,000 as compared to FTAs of 6,46,000 in December 2009 and 5,34,000 in December 2008.
• FEE from tourism during 2010 were US$ 14,193 million as compared to US$ 11.39 billion during 2009 and US$ 11.74 billion during 2008. The growth rate in FEE in US$ terms during 2010 was 24.6 per cent.
• FEE from tourism during the month of December during 2010 were US$ 1.55 billion.

Government Initiatives/policy

According to the Consolidated FDI Policy, released by DIPP, Ministry of Commerce and Industry, Government of India, the government has allowed 100 per cent foreign investment under the automatic route in the hotel and tourism related industry. The terms hotel includes restaurants, beach resorts and other tourism complexes providing accommodation and /or catering and food facilities to tourists.

The term tourism related industry includes:

• Travel agencies, tour operating agencies and tourist transport operating agencies
• Units providing facilities for cultural, adventure and wildlife experience to tourists
• Surface, air and water transport facilities for tourists
• Convention/seminar units and organisations

T

he Government of India has announced a scheme of granting Tourist Visa on Arrival (T-VoA) for the citizens of Finland, Japan, Luxembourg, New Zealand and Singapore. The scheme is valid for citizens of the above mentioned countries planning to visit India on single entry strictly for the purpose of tourism and for a short period of up to a maximum of 30 days. During 2010, a total number of 6549 Visa on Arrivals (VoA) were issued under VoA Scheme.

The tourism master plan, the first for Karnataka, envisages initiatives to attract private investment ranging from US$ 2.2 billion to US$ 4.4 billion in the next three to five years. The plan is prepared based on the Vision 2020 document prepared and adopted by the Karnataka State Planning Board. The state government aims to generate 200,000 jobs in the tourism sector in the next five years. The master plan is aimed at making Karnataka the number one destination for tourism in the country by 2020.

As per the press release by Press Information Bureau (PIB) dated November 15, 2010, the Union Ministry of Tourism has included Medical Tourism under the Marketing Development Assistance (MDA) Scheme. The Ministry of Tourism has sanctioned US$ 27,742 as MDA to 10 Medical Tourism Service Providers during current year.

The Ministry of Tourism has sanctioned 781 projects in 34 States/ Union Territories (UTs) in the country amounting to US$ 511.82 million during the last three years up to June 2010, as per a press release dated October 18, 2010.

The Ministry of Tourism has won a PATA Grand Award and two PATA Gold Awards during the Pacific Asia Travel Association (PATA) Travel Mart 2010 in Macau. The PATA Grand Award was given under the Heritage category for the Rural Tourism Project at Hodka village in Kutch District of Gujarat.

Medical Tourism

As per a market research report ‘Booming Medical Tourism in India’ by RNCOS, India’s share in the global medical tourism industry will reach around 3 per cent by the end of 2013. Moreover, medical tourism is expected to generate revenue worth US$ 3 Billion by 2013, growing at a CAGR of around 26% per cent during 2011–2013. The number of medical tourists is anticipated to grow at a CAGR of over 19 per cent during the forecast period to reach 1.3 Million by 2013.

Factors such as, low cost, scale and range of treatments provided by India differentiate it from other medical tourism destinations. The growth in India’s medical tourism market will be a boon for several associated industries, including hospital industry, medical equipments industry and pharmaceutical industry.

Domestic medical tourism in the country has also seen growth in the recent years. As per the report ‘Domestic Tourism in India, 2008-09’ released by the National Sample Survey Office (NSSO), trips for ‘health and medical’ purposes formed 7 per cent of overnight trips in the rural population and about 3.5 per cent in the urban population. ‘Health and medical’ purposes accounted for 17 per cent of same-day trips in rural India and 8 per cent in urban India. Expenditure on medical trips accounted for 30 per cent of all overnight trip expenditure for rural India and 15 per cent for urban.

R

ecently, the Union Ministry of Tourism has included Medical Tourism under the Marketing Development Assistance (MDA) Scheme. The Ministry of Tourism has sanctioned US$ 27,400 as MDA to 10 Medical Tourism Service Providers during 2010.

Hospitality

The current count of hotel rooms is 130,000, and the country is expected to require an additional 50,000 rooms over the next two to three years, according to World Travel and Tourism Committee (WTCC) estimates

• US-based hotel chain, Marriott International, plans to expand its network in India to 100 hotels over the next five-years, stated Arnie Sorenson, Chief Operating Officer, Marriott International. At present, the group operates 11 properties across the country.
• Roots Corporation, a subsidiary of Indian Hotels Company (IHC), plans to open 60 to 70 budget hotels, known as Ginger Hotel, in 23 locations across the country.
• ITC, the Kolkata-based cigarette major, also projected its plan to open 25 new hotels under the Fortune brand over the course of next 12-18 months (or by 2011).

The Road Ahead

The Indian hospitality sector is certainly the most apt replication of the belief 'Atithi devo bhava'- touch of tenderness, a helping hand and a welcoming visage.

According to the Tourism Satellite Accounting (TSA) research, released by World Travel and Tourism Council (WTTC) and its strategic partner Oxford Economics in March 2010:

• The contribution of travel and tourism to Gross Domestic Product (GDP) is expected to increase from 8.6 per cent (US$ 117.9 billion) in 2010 to 9.0 per cent (US$ 330.1 billion) by 2020.
• Export earnings from international visitors and tourism goods are expected to increase from US$ 11.1 billion in 2010 to US$ 33.6 billion in 2020.
• Travel and tourism investment is estimated at US$ 34.7 billion or 7.2 per cent of total investment in 2010. By 2020, this should reach US$ 109.3 billion or 7.7 per cent of total investment.

Ministry of Tourism aims to create a comprehensive and coordinated framework for promoting golf tourism in India, capitalising on the existing work that is being carried out, and building upon the strength of India’s position as the fastest growing free market economy.

Exchange rate used: 1 USD = 45.46 INR (as on January 2011)

Disclaimer: This information has been collected through secondary research

Impact of Corruption on Indian Businesses

Impact of Corruption on Indian Businesses: Survey

Until a year ago, it was of common knowledge that corruption is deeply rooted in India. However, it was the scandalous year 2010 that established this perception into fact. All the major scams – be it Commonwealth games fiasco, 2G spectrum allocation scam or bribe for housing loan scandal – were unearthed during previous year.

Even equity markets crumbled by 15% as the year ended on a sagging note. Some analysts attributed this weakness in markets to uneven inflation-growth dynamics, while others blamed it on India’s lost credibility with regard to governance issues.

Having said above, the FIIs have still not yet fully discounted the negativity arising out of corruption issues. The theory that is still doing the rounds among the institutional investors is that the India is still on growth track irrespective of the recent scam instances.

However, the same optimistic sentiment has not been reflected when it comes to insight from corporate India – i.e. those who are directly involved in dealing with the challenges faced on account of corruption issues.

To keep a tab on what India Inc feels about corruption issues, KPMG India surveyed leading Indian companies to keep a tab on sentiment and perception of how corruption is corroding economy as well as corporate environment.

Key Highlights of the Corruption Survey:

Over 2/3^rd of the survey respondents perceive that India can touch 9% GDP growth if corruption is controlled. Otherwise, it would result in volatile political and economic environment.

Impact of corruption on India’s GDP growth

Half of those surveyed felt that India corruption may hit the investment sentiment and render India less attractive destination for foreign investment.

Respondents to the extent of whopping 90% felt that corruption would also translate into increased stock market volatility and prevent institutional investors from making long-term commitments.

99% of respondents opined that the biggest impact of corruption on business is its tendency to skew level playing field and attract organizations with lesser capability to execute projects. This could create inefficiencies in the system and hence increase the cost of operations.

Impact of corruption on business

Now, take this! Well, it’s a no shocker, but certainly a bit surprising. Almost 68% people attribute corruption to be induced by the private sector; even as wide majority of us put the blame on the government enterprises.

India has seen stupendous growth in mergers and acquisitions. But, here could be a small hump in the tale. Nearly 37% of respondents felt that corruption could impact the valuation of a company thereby denying shareholders a fair price.

eedless to say, real-estate industry has remained as the most corrupt industry, as told by 32% respondents, which is highest quantification going industry-wise.

Perception of most corrupt industries

So, any take on which industry is most corrupted after real-estate? Well, no points for guessing, its telecommunications sector – especially, after recent 2G spectrum allocation scam, 17% of those surveyed felt this sector is fraught with corruption issues.

Most significantly, when it comes to anti-corruption measures, a majority 84% of those surveyed opined that Indian government failed to effectively enforce anti-bribery and corruption laws.

How will corruption scenario in India change in the next 2 years?

Interestingly, when asked as to how will corruption scenario in India change in the next 2 years – 46% felt that corruption is here to stay in the system, while 15% opined that corruption shall continue to thrive and increase irrespective of the legislation.

Certainly, we cannot take the above survey findings with a pinch of salt. There is lots of reality behind above survey outcome. Can India come out winner out of such trying circumstances?