Monday, January 29, 2007

Reliance sees new retail business bringing in US$22 billion in 4-5 years

NOIDA, India: Reliance Industries Ltd., one of India's top business conglomerates, hopes its recent entry into the retail business will bring in 1 trillion rupees (US$22 billion, €17 billion) in sales over the next four to five years.

The forecast came Monday as the company opened nine stores in the five satellite towns around India's capital, New Delhi, mostly selling vegetables and groceries.

Around the country, Reliance has opened 49 stores so far. By December, it aims to open 1,000 stores in India, where the booming retail market — estimated at about US$200 billion (€155 billion) per year_ is currently dominated by more than 12 million mom-and-pop shops.

"By 2010-11, our total revenue should be in the region of 1 trillion rupees," said Raghu Pillai, chief executive of the company's retail business.

Large, air-conditioned stores remain a rarity in India, even as rising middle-class incomes and an increase in demand for branded products are driving a retail surge in India. Selling through company-owned stores — also called organized retailing — currently totals just US$8 billion (€6.3 billion).


In recent years though, the share of organized retailing has grown with many Indian companies entering the lucrative trade.

Reliance plans to invest about 250 billion rupees (US$5.5 billion; €4.3 billion) in building a nationwide network of procurement centers, cold storage centers and stores. The first of the company's stores opened in the southern Indian city of Hyderabad in November.

Its plans are by far the most aggressive among the domestic players, but Reliance faces tough competition from U.S. retail giant Wal-Mart Stores Inc., which recently tied up with a local company Bharti Enterprises to enter the Indian retail business. The first store from their joint venture is expected to open by August this year.

"We will be a formidable competitor to Wal-Mart," Pillai said.

Reliance insists its knowledge and understanding of the Indian market gives the company an edge over Wal-Mart. Also, the company is confident keeping prices of products at its stores competitive.

"It will be a combination of price and how well we will execute our model," which includes services such as home delivery, shop-on-phone and engaging small traders in the management of its supply chain, Pillai said.

"Our stores will have a non-intimidating environment with products available at affordable prices."

The company has so far opened 49 stores, mostly selling fruits, vegetables, grocery and diary products.

India's ace pacer Pathan joins team for last one-dayer against Windies

Ace pace bowler Irfan Pathan joined the Indian team on Monday for the fourth and final limited-overs international against the West Indies, a month after he was sent back from the tour of South Africa to regain his bowling rhythm.

Pathan was included in the Indian squad for the last one-dayer as the national selectors are seeking to try out several candidates before picking the World Cup team.

India leads 2-1 going into the final game of the four-match series Wednesday, which will be the last international fixture for the West Indies cricketers ahead of the World Cup, to be played in the Caribbean islands during March and April.

West Indies will take a break after this series and later regroup for a training camp ahead of the World Cup.

India is looking to avenge its humiliating 4-1 loss in the one-dayers when it toured the West Indies last year.

Pathan had a workout at the nets Monday with the few Indian players who had reached the western city of Baroda, even as other cricketers took time to visit their families after Saturday's match in Chennai.

Going through a lean patch, Pathan was sent back from South Africa ahead of the third and final test match as chief selector Dilip Vangsarkar advised the left-arm pace bowler to play some domestic matches.

India's sports scientist, Ian Fraser said Pathan seemed to have rediscovered his rhythm.

"Irfan seems to have got his bowling rhythm back. There was fluidity in his motion, the run-up was fluent and the ball-delivery action smooth," Fraser told reporters after the net session.

Beside Pathan, who is expected to open the Indian attack in the final one-dayer against the West Indies, the team management also summoned pace bowler Munaf Patel to gauge his recovery from injury.

Patel's injury during the South African sojourn restricted his appearances. Even after inclusion in the Indian side for the third test match, Patel appeared short of match-fitness and was dropped from the squad for the ongoing limited-overs series.

Patel bowled for an extended spell in the nets despite using a shortened run-up. Observing him was the team's physiotherapist, John Gloster who is to submit a report on the fitness of all players to the Indian cricket board before the selectors pick the team for next month's four limited-overs internationals against Sri Lanka.

"We wanted to have a look at Munaf's bowling ahead of the series against Sri Lanka," Indian captain Rahul Dravid said, implying that the selectors were still considering Patel for inclusion in the World Cup team.

India's World Cup squad will be announced midway through the one-day series against Sri Lanka.

Russia's president calls on India

President Vladimir Putin of Russia may have been the man of the moment at India’s grandest annual parade, but there weren’t many fireworks when it came to talking business as both sides nudged each other to make more concessions in the road to renewing once tight ties.

Putin, who flew into New Delhi last week, was the guest of honor at the 58 th Republic Day Parade, where much of the military arsenal on display was Soviet-made, a reminder of the close defense and economic ties between the countries in the 1970s and 1980s.

Putin, 55, offered to build four nuclear reactors in the South Indian state of Tamil Nadu. Russia is already building two reactors in India. But though both leaders shook hands on the issue, there’s not much that can be done until the Indo-U.S. nuclear deal is approved by the 45-nation Nuclear Suppliers Group, which regulates nuclear energy trade globally. The recent arrangement with the United States ended a longstanding ban on American exports of nuclear technology to India.

Putin's visit saw India and Russia sign a $250 million contract to jointly produce jet engines, a fraction of the billions of dollars totaled in military trade between the countries before India opened its doors to markets in the West, especially the United States.

Overall, a mere 0.7% of India’s exports went to Russia last year, worth $733.15 million, and 1.4% of its imports came from Russia--$2.02 billion’s worth, according to government figures.

Prime Minister Manmohan Singh acknowledged the reduction in business ties. “Both of us agree that our economic relationship is far below what is consistent with the demands of our strong strategic partnership and the growth profiles,” he said Thursday.

Indian businessmen wanted Putin’s government to relax visa rules to help their ventures into lucrative Russian markets. But Putin said New Delhi should first limit illegal immigration into Europe.

India is also looking to Russia to help meet its growing energy needs. India's Oil and Natural Gas and the Russian state oil major Rosneft have agreed to jointly bid for exploration and refining projects in India, Russia and other nations. The firms are already partners in Russia's huge Sakhalin-1 oil and gas field. But Oil and Natural Gas is looking for a lot more.

Prime Minister Singh called energy security “the most important of the emerging dimensions of our strategic partnership.” And he made it a point to go to the airport to personally receive Putin—a courtesy that has so far been extended only to President George W. Bush of the United States and Saudi Arabia’s King Abdullah.

This was Putin’s fourth visit to India since he became president, and it’s seen as an indication that despite the new warmth in ties between India and the U.S., Russia will get its share of the pie when India goes shopping globally for needs ranging from defense to energy.

India becomes 10th largest trading partner of china

With European Union maintaining its position as China's top trading partner, trade between China and India reached a record $24.9 billion last year to make India the 10th largest trading partner of China, reports the latest Chinese foreign trade statistics.

The buoyant trade has exceeded the $20 billion goal two years ahead of target.

China's total bilateral trade with the EU rose 25.3 per cent to hit $272.3 billion.

The two Asian countries had signed an agreement in 2005 to raise bilateral trade volume to $20 billion by 2008.

Chinese Premier Wen Jiabao’s visit to India in 2005 and that of President Hu Jintao’s in 2006 have reinforced Sino-Indian trade and economic cooperation, reports Chinese Commerce Ministry.

China's major exports to India are mobile phones, antibiotics, coal, coke, textile machinery and spare parts. China's major imports from India are iron ore and concentrate, steel products, primary plastics, alumina and diamond.

China signed economic and technical contract worth $7.012 billion with India which resulted into achieving a turnover of $2.108 billion by end of 2006.

Chinese companies won project contracts worth $3.298 billion in 2006, making India one of China's most important overseas project contracting market.

Friday, January 12, 2007

India's Mukherjee to Visit Pakistan for Peace Process

India's Foreign Minister Pranab Mukherjee begins a two-day visit to Pakistan today as the nuclear-armed South Asian neighbors seek to advance a 44-month- old peace process.

Singh will review progress made in the third round of the peace dialogue that was concluded in November in New Delhi with his counterpart Khurshid Kasuri, besides planning for next round of talks, Pakistan Foreign Ministry spokeswoman Tasnim Aslam told reporters in Islamabad on Jan. 8.

``This is a just a continuation of the formal diplomatic process,'' said Ajai Sahni, executive director of the Institute for Conflict Management, a New Delhi-based policy research group. `` There will be the usual announcement of better cooperation, more talks scheduled for the future, because you cannot expect any radical changes to emerge from the meeting, as the fundamentals are same.''

India and Pakistan have been seeking to improve ties since 2003, restoring diplomatic, transport and sporting links, after they came close to fighting a fourth war in 2002. The two countries are holding a series of discussions on the various issues dividing them, including control over the Himalayan territory of Kashmir, which is claimed in full by both.

The visit of Mukherjee, the first trip to the neighboring country after he became foreign minister in October is also to extend an invitation to Pakistani leaders for the South Asian regional summit in New Delhi in April, Aslam has said.

The two nations resumed talks in November stalled by July's Mumbai commuter train blasts that killed 184 people.

Peace Hopes

Indian Prime Minister Manmohan Singh raised peace hopes by saying earlier this week that the two countries would eventually be able to sign a peace and friendship treaty.

``I earnestly hope that relations between our two countries become so friendly that we can generate an atmosphere of trust between each other and that the two nations are able to agree on a treaty of peace, security and friendship,'' Singh said in New Delhi on Jan. 8.

Khalid Mahmud, a research analyst at Institute of Regional Studies in Islamabad, said the peace process may not advance on resolving any key dispute, as both the countries seem stuck on their respective positions. Still, they will keep holding such meetings, as neither wants to derail the process, he said.

``India is calling for lasting peace, while Pakistan wants to settle the Kashmir dispute first,'' Mahmud said. ``Peace talks won't move forward if they stick to their positions.''

The two sides may sign accords on easing visa restrictions and avoiding nuclear confrontation to show that talks are not stalled, Mahmud said.

Procedural Requirements

There is nothing definitive about the signing of any agreements between the two nations, Pakistani spokeswoman Aslam said. A number of agreements are in the works and some of them await completion of procedural requirements, she said.

India and Pakistan have fought three wars since independence from Britain in 1947, including two over Kashmir. A 17-year insurgency in India's only Muslim-majority state of Jammu and Kashmir has left at least 50,000 people dead.

India has accused Pakistan of supporting the insurgency, a charge Pakistan denies.

Officials of the two sides have been holding a series of talks on issues such as the control of Kashmir, economic and commercial cooperation, terrorism and drug trafficking -- known as the ``composite dialogue.''