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Friday, January 05, 2007

An Interesting Article on India

I know some of the guys on the course have had thoughts off using the offshore resources in India as part of there business model I thought this would be a nice starting article for our discussions this weekend.

Ruth David On The Big Trend

An India story that’s not just about information technology and the services industry. Companies in sectors like retail, telecom, manufacturing and pharmaceuticals will expand globally while consolidating India operations. Cross-border mergers and acquisitions will continue, with the average deal size increasing in value. In India, the number of people working for foreign firms is bound to increase, but there will also be a rise in the number of Westerners working for Indian firms as they set up bases outside their country.
The Unconventional Wisdom
Despite political pressures within India’s ruling coalition and disagreements with state governments, reforms in the power and infrastructure sectors will make sustainable progress. Indians may have resigned themselves to problems like interrupted power supply and bad roads. But state governments will realize that if they want to retain foreign and domestic investments, they need to fix these bottlenecks.
The Misplaced Assumption That India is unstoppable, the market will continue to boom, real estate will stay at inflated levels and India will soon reach the high quarterly growth rates of 10% politicians and economists are predicting. Despite the economy’s growth spurt in the recent years, the anticipated demand far exceeds potential supply. Skyrocketing wages won’t help solve the shortage of skilled labor. And that’s not all--infrastructure is not equipped to deal with the onslaught of foreign and domestic investment. India may get a bit too hot to handle in 2007.
The Watch List
Manufacturers and alternative energy companies -- Manufacturing will continue to show its recent sustainable strength. As India struggles to meet it growing energy needs from renewable, nonpolluting sources, there will be a push toward wind energy and bio fuels, like ethanol from sugarcane. Accord on the India-U.S. nuclear deal will result in large investments in building nuclear plants and a land grab by American and European multinationals for lucrative energy contracts.
The Bold Prediction
The Indian government will allow foreign universities to enter India, setting in motion a revolution in education and helping the country meet the growing demand for an educated workforce. Only 50 million of India’s 1.2 billion people have degrees past high school. As global companies head to these shores in search of talent, there’s an urgent need to increase that number. Foreign institutions will ease the pressure on crowded Indian schools as well as give graduates a chance to specialize in a wide range of fields



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