Transcript Document

The Indian scenario
By
Prem Behl
Chairman
Exhibitions India Group
Index
1. The Indian Economy: An Overview
2. History of the Indian exhibitions industry
3. Exhibitions Venues in India
4. Doing business in India
1.
The Indian Economy: An Overview
The Indian Economy: An Overview
The fastest rise in incomes….
70
36
20
1950s
13
1960s
7
1970s
1980s
% rise in per capita income
1990s
The Indian Economy: An Overview
The biggest drop in inflation…
9.5
9.1
7.4
4
1970s
1980s
1990s
% decrease in inflation
2000-4
The Indian Economy: An Overview
Have prompted a spending boom…
11.4
9.5
6.5
5.9
2000-01
2001-02
2002-03
2003-04
% growth in consumption expenditure
The Indian Economy: An Overview
…as well as the highest level of savings
26.6
19.3
21.9
13.8
1980-81
1990-91
2000-01
2003-04
Household savings as % of GDP
The Indian Economy: An Overview
The economy is riding high
8.5
7*
6.9
4.4
2002-03
2003-04
2004-05
2005-06
% annual growth in GDP
The Indian Economy: An Overview
Additional economic indicators:
• India is the 4th largest economy in the world as measured by
purchasing power
• Between 1980 and 2003, India’s economy grew at an average
rate of 5.7%
• During the same period, India’s real income per head grew by
125%
• Dr. Manmohan Singh, Finance Minister in 1991 and architect of
India’s economic reforms, is the current Prime Minister
The Indian Economy: An Overview
• India has a consumer base of 1.2 billion people, and
• The youngest population of the world – hence sustainable, long
term growth is assured
• Modern (organised) retail converging with the consumption boom
will open up many opportunities for small and mid-size consumer
companies
• With upper income and rich classes growing rapidly and deprived
classes actually falling, India’s income demographics will actually
be unrecognizable by the end of the decade
The Indian Economy: An Overview
• Home ownership is on the rise with 5 Million homes added every year,
approximately 1.5 Million new homes added in urban areas
• Mobile telephone subscriber base has grown from 0.3 Million in 1996
to over 55 Million currently; expected to grow to 200 Million by 2008
• 13 Million credit card holders currently & growing at 40% p.a.
• Passenger car sales of USD 5 Billion in 2004, more than twice the
level of sales five years earlier
The Indian Economy: An Overview
Consumption share of GDP
Per Capital Consumption
70
Population Dependency Ratio
5
60
4
40
3
30
2
US $ Thousands
Percent
50
Growth at the margin
will close the gap
between India’s per
capita consumption
and China’s
20
1
10
0
China
India
0
•
Private consumption currently accounts for 64% of Indian GDP –
higher than Europe(58%), Japan (55%) and China (42%)
•
Emerging consumerism from one of the world’s youngest population
Population Dependency Ratio = Ratio of Pop aged 65 years or over to the population aged 15-64 (Source: Morgan Stanley)
The Indian Economy: An Overview
Indians are Younger than the World…
Median age in years
50
45
44
44
40
37
36
35
31
30
24
39
39
38
30
24
India
USA
China
Russia
UK
2000
2025
The Indian Economy: An Overview
India in 2050
BRICs = Brazil, Russia, India, China
Source: Goldman Sachs, “Dreaming with the BRICs”
…..with the highest growth rate of BRICs
5-Year Period Average Percent Per
Annum
Ita
ly
Fr
an
ce
an
y
UK
G
er
m
Ja
pa
n
Br
az
il
Ru
ss
ia
In
di
a
Ch
i
US
50,000
45,000
40,000
35,000
30,000
25,000
20,000
15,000
10,000
5,000
na
US 2003 $ billions
India will be the 3rd largest economy….
8
7
6
Brazil
5
China
4
India
3
Russia
2
1
0
2005-10
2015-20
2025-30
2035-40
2045-50
The Indian Economy: An Overview
Analysts’ View of the Indian Economy
• “India is on the cusp of something big….[I] am as enthusiastic about India
as I was about China in the late 1990s. What excites me most is the
potential for an increasingly powerful internal consumption dynamic – the
missing link in most development models.”
Stephen S. Roach, Chief Economist, Morgan Stanley Equity Research Global,
October 31, 2005
• “A dynamic and open India would have an important impact on the world
economy. If India continues to embrace globalization and reform, Indian
imports could increasingly operate as a driver of global growth as it is one
of a handful of economies forecast to have a growing working-age
population over the next 40 years.”
IMF, World Economic Outlook, September 2005
2.
History of the Indian exhibitions industry
History of the Indian exhibitions industry
• The history of Indian exhibitions dates back hundreds of years
• Take, for example, India’s huge Pushkar Mela – now a great
tourist attraction
• Thousands of camels are traded on the sands of Rajasthan
annually, even today
History of the Indian exhibitions industry
• Soon after independence, in the late
1940’s, the Government set up the
Directorate of Exhibitions under the
Ministry of Commerce
• An exhibition ground in New Delhi
was developed to host the Railways
exhibition in 1952 to mark the
centenary of railways in India
History of the Indian exhibitions industry
1970
• The Trade Development Authority (TDA) was set up in 1970 under
the Ministry of Commerce
1972
• The fair ground was christened
“Pragati Maidan”
• Pragati Maidan hosted “Asia’72:
third Asian International Trade Fair”
coinciding with India’s Silver Jubilee
Year of Independence
History of the Indian exhibitions industry
1977
• The Trade Fair Authority of India (TFAI) is formed by an Act of
Parliament with the aim of organising trade shows
1992
• The India Trade Promotion Organisation (ITPO) is formed by
merging the Trade Development Authority (TDA) with the Trade
Fair Authority of India (TFAI)
3.
Exhibitions Venues in India
Exhibitions Venues
in India
• Exhibition
ExhibitionVenues
Venues
• International
InternationalAirports
Airports
Exhibitions Venues in India
New Delhi
Name
Pragati Maidan
Owned and managed by the Indian
Trade Promotion Organisation (ITPO)
Area
Outdoor Area
(in sqm.)
(in sqm.)
60,000
10,000
Additional facilities
2 Conference Halls
(capacity – 200 each),
4 theaters
Exhibitions Venues in India
New Delhi
• Pragati Maidan is a massive venue of 149 acres in the heart of India’s
capital city
• The venue’s 16 exhibition halls and other facilities are ageing and far
from being world class
• The ITPO has proposed to completely modernize and revamp the
venue by 2010 (subject to approval by the Commerce Ministry)
Exhibitions Venues in India
Greater Noida
Name
Area
Additional facilities
(in sqm.)
India Expo Center
Owned by the Export Promotion
Council for Handicrafts (EPCH)
7,500
1st phase of construction complete.
Another 20,000 sqm., as well as a 5
star hotel, to be built by 2008
Exhibitions Venues in India
Mumbai
Name
Expo Center
Owned by the World Trade Center
Bandra Kurla Complex
Owned by the Maharashtra Dev. Co.
Bombay Exhibition Center
Owned by Nesco Ltd.
Area
Additional facilities
(in sqm.)
Outdoor
Area (in sqm.)
2,500
n/a
n/a
n/a
50,000
Organisers typically set up air
conditioned hangars
60,000
n/a
Non air-conditioned halls
Exhibitions Venues in India
Chennai
Name
Chennai Trade Center
Owned by the Indian Trade
Promotion Organisation (ITPO)
and the Govt. of Tamil Nadu
Area
Additional facilities
(in sqm.)
Outdoor
Area (in sqm.)
6,800
3,000
Opened in 2001,
1st phase complete
Conference Room
(Capacity – 200 people)
Exhibitions Venues in India
Bangalore
Name
KTPO Exhibition Complex
Owned by the ITPO and the
Karnataka Industrial Area
Development Board (KIADB)
Area
Outdoor Area
(in sqm.)
(in sqm.)
5,500
4000
Additional facilities
Opened in 2004,
1st phase complete
Conference Room
(capacity – 200)
Exhibitions Venues in India
Hyderabad
Name
Hitex Exhibition Center
Jointly owned by the Govt. of Andhra
Pradesh and the private sector
Area
Outdoor Area
(in sqm.)
(in sqm.)
10,000
30,000
Additional facilities
Opened in 2003
1st phase complete
Opportunities Aplenty
• The need for quality trade shows and venues is apparent
• If India and China are Asia’s emerging giants, then India is falling
terribly behind in its trade fair development
• China has approximately 150 exhibition centers and 3 million
square meters of exhibition space
• India, according to our calculations, has 6 dedicated exhibition
venues and 90,000 square meters of indoor exhibition space – this
is estimated to increase by 40% in 3 years
4.
Doing business in India
Doing business in India
• There exists a myth that doing business in India is difficult.
With the right Indian partners, this is not at all the case
United Nations World Investment Report 2005
• A TNC (transnational corporations) survey has ranked India
as the third most attractive investment destination
• In the same report, a UN expert opinion group ranked India as
the second most attractive investment destination
Doing business in India
Indian Trade Promotion Organisation (ITPO)
• In order to organise a trade show in India, an organiser must gain
approval from the ITPO
• For leading trade show organisers, this is a straight forward and
simple process
• This approval consists of a Customs Notification allowing the
duty free temporary import of goods to be displayed
Doing business in India
Customs
• In line with international practices, there exists a well
established system allowing foreign participants the facility of
duty free temporary imports for exhibitions
• India is a signatory to the ATA convention. ATA Carnets are
accepted at all major exhibition destinations in India
Doing business in India
Freight Handling
• There are professional and experienced exhibition logistics
companies that provide a full range of services
• The scope of services range from customs clearance to on site
handling with modern mechanical handling equipment and a
skilled work force
• These logistic service providers have an extensive international
network
Doing business in India
The following is a brief list of leading freight forwarders
•
•
•
•
RE Rogers India Pvt. Ltd.
Translink Express (I) Pvt. Ltd.
Schenker India Pvt. Ltd.
Orient Marine Lines Pvt. Ltd.
The following is a brief list of leading stand constructers
•
•
•
•
Pavilions & Interiors India Pvt. Ltd.
PICO International Exhibitions Pvt. Ltd.
Meroform (India) Pvt. Ltd.
Kingsmen Fairtech International Pvt. Ltd.
Doing business in India
Reforms in Exchange Control & Taxation
Exchange Control
•
All investments can be on a repatriation basis
•
Original investment, profits and dividends can be freely
repatriated
•
Foreign investors can acquire immovable property incidental to or
required for their activity
(Source: Ministry of Commerce & Industry, Government of India)
Doing business in India
Reforms in Exchange Control & Taxation
Taxation
• Companies incorporated in India are treated as Indian companies
for taxation
• There exists a Double Taxation Avoidance Agreement with 65
countries
• Peak Custom duty has been reduced to 15%
•
Corporate Tax has been reduced to 30%
•
Tariff to be aligned with ASEAN levels
•
Value Added Tax introduced in some States from 1st April 2005
•
Transparency in Tax Structure: Online/ ICT Applications
(Source: Ministry of Commerce & Industry, Government of India)
Thank You
The Indian Economy: An Overview