Friday, February 26, 2010

Qatar+Russia>UnitedStates

Qatar emerges as a new king in LNG

Call it by any name, oil is one thing that makes headlines and tops the agenda in any global forum. From G2 to G12, all Gs and non-Gs are concerned about their fuel efficiency. However with crude oil prices jumping the bungee gun with every passing quarter, Hamad bin Khalifa, Emir of Qatar found a route as innovative as could be praised in ivy league b-schools.

When Qatar discovered huge reserves of Liquefied Natural Gas, the western economies did not give it a second thought. Qatar had no gas transport lines to export the gas to other countries. They didn’t bargain for the Emir, did they? Bin Khalifa worked out the most brilliant arrangement to transport Qatar’s gas in, surprise surprise, ships! From an initial start to today, with Russia’s fleet of 10 LNG vessels (capacity of 135,000 cubic meters each), Qatar is able to supply LNG to almost all Asian, European and even American countries. It’s status in the global gas industry? Bin Khalifa has made Qatar the world’s largest producer, with 31.7 million tonnes produced in 2007!

When compared, the natural gas market today is about 60% of the crude oil market; but is estimated to grow by some 25% by 2010 and 35% by 2012. And thanks to the clean fuel initiative clubbed with rising oil prices, LNG seems to see a new dawn altogether. Take for instance, in 2005 Japan imported 58.6 million tons of LNG, South Korea imported 22.1 million tons while in 2004 Taiwan imported 6.8 million tons. Recently in 2006, Spain imported some 8.2 million tons. While the US seems self sufficient with its gas production, the same isn’t the case in Europe.

Qatar has spent billions of dollars with the help of Russia. Qatar is further exploring avenues, in partnership with ExxonMobil, to create petroleum products using gas, instead of crude oil. Further, Qatar has invested $4 billion to build the world’s largest natural gas processing facilities. For all practical purposes, Qatar and the world have only one person to thank for finding out a way in transporting gas where none existed. Crown Prince since 1977 and Emir since 1995, Sheikh Hamad Bin Khalifa Al-Thani rocks!

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Source : IIPM Editorial, 2009


An IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative

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Outlook Magazine money editor quits
Don't trust the Indian Media!
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Wednesday, February 24, 2010

“We focussed on cost cutting and creativity”

B&E: How did you prepare yourself for the slowdown in demand last year?

VG: We were among the early risers to the deteriorating conditions. However, since JSPL’s product range includes both long and flat products we were well placed to optimize our product mix in consort with changing market realities and thereby protect our bottom-lines. Among other enabling factors have been our high retained earnings and low debt.

B&E: Mostly, analysts say that India Inc. has managed profitability through extensive cost cutting...

VG: We rode out the global storm with a game plan focused on both cost-cutting and creativity without reducing production. Ideas gleaned from shop floor workers were aggressively sought out and implemented. In addition, we engaged some of the best consulting firms in key niche areas, like Accenture, McKinsey and Hewitt. All around the thrust was on encouraging creative thought and economizing through enhanced efficiencies.

B&E: How secure do you feel w.r.t. resources?

VG: In the current business milieu no company in our space can hope to survive without robust backward integration. JSPL has always believed in this and assiduously built dedicated sources for key raw materials (ore, power and coal) in keeping with the integrated steel producer model, which is widely regarded as the most efficient in the industry. Among other advantages, this model insulates us against industry cycles.

B&E: Are you seeing the demand situation reviving now?

VG: The real, big recovery is still some distance away. However, there are encouraging signs of demand picking up. This is evident from the fact that prices have increased by about 8-10% in the domestic market and 7 to 8% globally. Besides, there has been a considerable increase in business enquiries from Southeast Asia and the Middle-East—all signs of better times.
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Source : IIPM Editorial, 2009

An IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative

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Tuesday, February 16, 2010

Explaining his choice of adjusting the CRR

Explaining his choice of adjusting the CRR rather than interest rates, Subbarao said, “If we had used interest rates it would mean that the amount of liquidity we would have absorbed would have been more unpredictable.” True Mr. Governor, but then, was there really a need to touch any of them? By increasing CRR hasn’t RBI made both inflation and growth more unpredictable now? In fact, RBI has itself raised both its growth and inflation forecasts for the current fiscal. While, it has raised its end-March WPI inflation target to 8.5 per cent from 6.5 per cent earlier, GDP growth forecasts for FY2010 has been raised significantly to 7.5 per cent from 6 per cent earlier. However, a simple calculation and this targeted growth rate perhaps seem to be a distant dream!


As per Central Statistical Organisation (CSO), the GDP grew by 7 per cent in H1 FY2010. So if overall expansion for FY2010 is targeted at 7.5 per cent (not to forget RBI expects Q3 growth rate to be lower than Q2’s 7.9 per cent), it means the economy will have to grow over 8-8.5 per cent in Q4 FY2010, which at present seems be an unlikely phenomenon. Raison d'être: RBI’s growth assumption is based on flat growth of agriculture sector (which anyway has been stagnant for quarters now). But given an expected 16% fall in kharif crop output this year, as many experts believe, agriculture’s contribution to GDP is estimated to fall by over 5%. Moreover, the growth momentum in industrial and services sector doesn’t really seem to compensate the fall in agriculture. So, God knows how the economy is going to click that growth number (7.5%). Even by if any chance the central bank’s projections on growth and inflation materialise, odds are that the latest CRR hike could prove insufficient to tackle the situation.
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Source : IIPM Editorial, 2009


An IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative

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Monday, February 15, 2010

International observers also agree

Strengthening of democratic institutions would be equally crucial. Sarath Fernando, moderator of the Movement of Lands and Agriculture Reform, told TSI, “A country needs strong democratic institutions for confidence building. We are no exception.” A strong independent media is the need of the hour. One of the conflict’s casualties has been an independent press that can openly criticise both the parties without any fear of retribution. Sri Lanka’s ranking in a press-freedom index has slid in recent years as prominent journalists critical to both the Rajapaksa political family and the LTTE have been assaulted, threatened and even killed.

The campaign promises have been rather positive. Parties, openly chauvinistic in the past, talked about reconciliation this time around. However, the process of reconciliation depends on what the winner actually does in office. Although constitutional reforms to end marginalisation look a far cry, small positive indications from the regime will definitely help bolster harmony. “Harmony is the priority. Reconciliation is a big word. We need sustained rational regimes to achieve that,” adds Sarweshwaran.

International observers also agree with this line. The roots of the decades-long conflict — social, economic and political imparity — needs to be done away with. If left unaddressed, Tamil humiliation and frustration could well lead to militancy again. Says, Chris Patten, the co-chairman of the International Crisis Group who is working continuously in Sri Lanka since several months, “Sinhalese-dominated political parties should make strong moves toward a more inclusive and democratic state. The onus lies on Tamil parties too. However, as in any democracy, it is the majority that leads the way.”

And at the end, it is remains to be seen whether Ponnambalam Ramanathan can return to Vavuniya and work successfully and unhindered as a carpenter. Given his background, many enemies will be lurking in the shadows.
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Source : IIPM Editorial, 2009


An IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative

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Friday, February 5, 2010

Party & ideology over nation

Here are five important reasons why:

Party & ideology over nation

Most will remember the visceral and unflinching manner in which Prakash Karat and his fellow comrades opposed the nuclear deal between India and the United States. During the official visit of George Bush to India, they even forgot courtesy while abusing and heckling him (one wonders how many people would have been killed in police firing if demonstrators had abused and heckled Chinse Supremo Hu Jintao during a hypothetical state visit to Kolkata?) But not many will remember that Marxists like Basu always blamed India more than China for the 1962 debacle. Just consider this: The CPI, mentored by the Soviet Union, supported the Emergency because Indira’s India was a Soviet ally; the CPI(M) opposed it vehemently because China was not very fond of Indira’s India. Of course, both supported the Soviet invasion of Afghanistan in 1979 and kept quiet on the Chinese invasion of fellow Marxist state Vietnam in 1979. Under Jyoti Basu, West Bengal always gave more importance to ideology over public interest. Anything that the United States did was wrong, sinful, imperialistic and evil. Anything that the former Soviet Union and China did was far above criticism. This was all right till the 'ideology over national and public interest' line was largely symbolic. But, it had terrible consequences for the state when dogma invaded realpolitik and started affecting the lives and livelihoods of millions of citizens. Mercifully for India, voters now seem far less swayed by ideology and identity politics than they were in the recent past; that perhaps was the biggest message sent out by voters during the 2009 general elections when both the CPI(M) and the BJP were humiliated and humbled.

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Source : IIPM Editorial, 2009


An IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative

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Tuesday, February 2, 2010

Specialised MBAs are now coming up in various sectors


So MBA specialisations as such in IT are not required. But domain related specialisation is needed; for instance, in retail and banking (since the IT sector divides itself based on industry verticals). The IT industry historically has always struggled to find domain specialists.” The one major problem is related to the fact that the concept (of having an IT-MBA with a specialisation in a particular niche domain) in India is relatively new and standards haven’t really been set. Ravi Shankar B, Senior Vice President and HR-Head, India Operations, HCL, elaborates, “In terms of one feedback, quality of faculty is lacking. Faculty should have also worked in the industry. That makes sense. It’s a learning curve for MBA institutes.” So if institutes are using the same faculty and course structure in their general MBA courses to teach specialised courses, the education they impart may not be of the desired quality that a specialised MBA course deserves.

This is not that quite different from American MBA courses, which believe in offering more and more elective subjects as well as offering specialised MBA courses, all at the same time. For example, the Wharton MBA programme has the maximum electives – over 200 – for any MBA programme in the US. Students can take specialisations in electives ranging from Urban Fiscal Policy, Health Care Field, Urban Real Estate Economics, Probability Modelling in Marketing et al. At the same time, as of date, Wharton offers four different joint MBA programmes with specialist colleges within the Pennsylvania University – Lauder MBA (specialisation: foreign language), JD MBA (in law), MBA in Healthcare Management and MBA in Environmental Studies. But then, Wharton has the wherewithal, infrastructure and a global brand image. Can Indian B-schools match that?

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Source : IIPM Editorial, 2009


An IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative

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Monday, February 1, 2010

The 'quality' icon find a way to emerge as a powerhouse

"With rising rural sales and the approaching launch of the compact car, we believe that setting up dealerships in small towns is viable," asserts TKM’s General Manager (Sales), Sailesh Shetty. The company’s move of expanding its dealership network is rightfully supported by the launch of its small car as it''ll be then easily available to the consumer.

Nakagawa explains, “The aim of attaining the double-digit market share is closely related to the launch of the small car and once that happens, I believe we will be there before the target time.” It’s not Toyota alone which is going gung ho on the Indian compact car market; rivals like Ford, GM and Renault are also planning their respective small cars in the country around the same period. GM India will be launching their much-awaited Beat by early 2010 and same is the case with Ford Figo which was recently showcased in the country in the presence of Alan Mulally, President, Ford Motor Company. Time is definitely not on Toyota’s side, as the small car market has already got extremely crowded; and the company has no brand equity in this segment at all. GM has in fact strategised better than Toyota in this regard, with launches like Spark and U-VA. Moreover, the increasing competition in the SUV market may also pose a threat to the cushy position of TKM. In addition to the reloaded Endeavour from Ford’s stable, companies like Skoda, Hyundai, Volkswagen and Audi are going very bullish on the success of the Indian SUV market and have lined products to get their share of this pie. “The Indian SUV market still accounts for very low volumes as compared to passenger cars and will see a boost in the demand in the near future,” avows Pawan Goenka, President (Automotive), Mahindra & Mahindra.

Skoda is aiming to drive its Yeti into the Indian geographies by the first half of 2010. Similarly, Audi Q3, BMW X1 and Nissan Murano are expected to follow suit soon.

For Complete IIPM Article, Click on IIPM Article

Source : IIPM Editorial, 2009


An IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative

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