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©Lloyd’s

A guide to

INDIA

1



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FULL NAME / CAPITAL CITY: Republic of India / New DelhiPOPULATION / LANGUAGE: 1,156m / Hindi 41%, Bengali 8%, Telugu 7%, Marathi 7%, Tamil 6%, Urdu 5%, Gujarati 5%, Kannada 4% (2001

Census). Note: English is the most important language for national, political, and commercial communication

GDP (PPP): US$ 3862bn (Global Ranking # 4) (2010)

FDI STOCK (INWARD): US$ 158bn (Global Ranking # 24) (2009)

MAIN EXPORT PARTNERS: UAE 13%, US 13%, China 6% (2009)

MAIN IMPORT PARTNERS: China 11%, US 7%, Saudi Arabia 5%,UAE 5%, Australia 5%, Germany 5%,Singapore 4% (2009)

MAIN EXPORTS: Petroleum products, precious stones,machinery, iron and steel, chemicals,

vehicles, apparel

MAIN IMPORTS: Crude oil, precious stones, machinery,fertilizer, iron and steel, chemicals

EASE OF DOING BUSINESS: Global Ranking # 134 (2011)

COMPETITIVENESS: Global Ranking # 51 (2010 / 2011)

NATURAL HAZARDS: Droughts; flash floods, as well aswidespread and destructive floodingfrom monsoonal rains; severethunderstorms; earthquakes

A Guide to INDIA > Key Facts > 1 of 5

Source: CIA World Factbook (www.cia.gov); Competitiveness Index (www.weforum.org); ease of doing business index (www.doingbusiness.org)



©Lloyd’sSource: IHS Global Insight, The Economist


Summary

•India has a well-diversified export prof ile. The leading export category is textiles and garments, complemented bygems and jewellery, and the export of machinery and chemicals. Even further diversification exists in India's totalforeign-exchange earnings profile when service exports are included. India's dynamic service exports feature IT-and-related services, as well as financial, medical, and legal services.

• The UK and India are among the top investors in each other’s economies bringing significant long term benefits toboth. According to the UKTI, the UK is the largest European investor in India and the fourth largest internationally.Likewise, India is the third largest investor in the UK.

India: Major Trading Partners, 2010

EXPORTS IMPORTS

Country Billions of US$

PercentShare

Country Billionsof US$

PercentShare

US 27.5 13.2 China 44.0 12.9

UAE 25.0 12.0 UAE 22.0 6.4

China 17.7 8.5 US 20.4 6.0

Hong Kong 8.9 4.3 Saudi Arabia 19.6 5.7

Singapore 8.7 4.2 Australia 15.9 4.7

Germany 6.4 3.1 Singapore 13.3 3.9

UnitedKingdom 6.4 3.1

Iran13.3 3.9

J apan 5.0 2.4 Germany 12.4 3.6

Netherlands 4.5 2.2 Indonesia 11.1 3.2

Belgium 4.4 2.1 Hong Kong 9.7 2.8

India: Top-10 Sectors Ranked by Value Added

2010 2011 % Change % of GDP

US$ BN (Real terms) (Nominal)

Agriculture 269.7 5.2 17.0

Construction 124.5 6.0 7.8

Wholesale Trade 123.7 10.1 7.8

Retail Trade - Total 107.0 8.4 6.7

Public Admin. andDefense

97.9 6.9 6.2

Banking andRelated Financial

72.0 7.9 4.5

Real Estate 67.0 7.2 4.2

Business Services 60.2 9.3 3.8

Health and SocialServices

57.0 7.0 3.6

Education 40.0 7.2 2.5

Top-10 Total 1,019.0 64.2



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Source: Wikipedia, IHS Global Insight

NEW DELHI

• New Delhi is the capital city of India. It serves as the centre of the Government of India and the Government of theNational Capital Territory of Delhi. It is situated within the metropol is of Delhi. It is one of the nine districts of DelhiUnion Territory. The total area of the city is 42.7 km2. New Delhi hosts 134 foreign embassies and high commissions.

• The wider metropolitan area of Delhi is home to 16.8m people, the second largest in India after Mumbai.

• The foundation of the city was laid on 15 December 1911. It was planned by two leading 20th century British architectsnamely Sir Edwin Lutyens and Sir Herbert Baker. The new Capital was christened "New Delhi" in 1927, and subsequentlyinaugurated on 13 February 1931, by British India's Governor-General Lord Irwin.

• It is one of the fastest growing cities in the world and has a total population of nearing three hundred thousandresidents. New Delhi is one of the world’s top global cities.

• In a report jointly preparedby Institute for Competitiveness and Confederation of Indian Industry, the city is listed as

the best to live in India.

• According to Mercer, New Delhi is the most expensive city in India for expatriates in terms of cost of living. New Delhi isknown for its wide, tree-lined boulevards and is home to numerous national institutions, museums and landmarks.

• Connaught Place, one of northern India's largest commercial and financial centres, is located in the northern part of New Delhi. Adjoining areas such as Barakhamba Road and ITO are also major commercial centres. The government and

quasi government sectors are the primary employers in New Delhi.

• The city's service sector has expanded due in part to the large skilled English-speaking workforce that has attractedmany multinational companies. Key service industries include information technology, telecommunications, hotels,banking, media and tour ism.



©Lloyd’sSource: Census India, (2011), http://www.censusindia.net

2009 Population by state

Kolkata

Mumbai

Chennai

Hyderabad

ABOUT POPULATION BY STATE:

•India’s population is expected to increase from1,029 million to 1,400 millionduring the period 2001-2026, an increase of 36% in 25 years at a rate of 1.2%annually (Census India, 2001).

•According to the 2011 Census of India (provisional), the current population isestimated to be 1,210 million.

•Out of the total population increase of 371 million between 2001- 2026 theshare of workers in the age group 15-26 years in this total increase is 83%.

•India’s population in 1901 was about 238 million, which has increased bymore than four times in 110 years to reach a population of 1,210 million in2011.

•Decadal Growth Rate of population during 2001/2011 of the six mostpopulous States, (i.e. Uttar Pradesh, Maharashtra, Bihar, WestBengal,Andhra Pradesh and Madhya Pradesh), have all declined during 2001/2011compared to the previous decade (1991/2001).

TOP STATES LEGEND

State Population in million in % of total

Uttar Pradesh 200 16.5%

Maharashtra 112 9.3%Bihar 104 8.6%

West Bengal 91 7.5%

Andhra Pradesh 85 7.0%

Madhya Pradesh 73 6.0%

Tamil Nadu 72 6.0%

Rajasthan 69 5.7%

Karnataka 61 5.1%

Gujarat 60 5.0%

TOTAL 1,210 100.0%

LOW HIGH

Bengaluru

Jaipur

New Delhi

MA

BI

WB

AP

MP

UP

UP Uttar Pradesh

MA Maharashtra

BI Bihar

WB West Bengal

AP Andrah Pradesh

MP Madhya Pradesh

A Guide to INDIA > States and Key Cities > 1 of 9



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MAHARASTRA

Mumbai

Maharashtra is the 2nd largest state in India both in terms of population and geographicalarea. Population of Maharashtra is around 100 million (Census 2001) which is about9.4% of total population of India.

The Gross State Domestic Product at current prices for 2009/2010 is estimated at US$189bn and contributes about 14.7% of GDP. It is expected to grow by 10.5% during2010/2011.

Mumbai, the state capital and the financial capital of India, houses the headquarters of most of the major Indian corporate & financial institut ions.

The literacy rate in Maharashtra is 77% as against 65% at national level as per Census2001. The state has attracted 20% of FDI Industrial (approved) projects in India.

India’s main stock exchange, capital market and commodity markets are based inMumbai. The two most important financial institutions namely Reserve Bank of India(India’s central bank) and the Bombay Stock Exchange are headquartered inMumbai.

The three main sectors which contribute to Maharashtra’s income are:

•Services 61% (2009/2010)

•Industry 29% (2009/2010)

• Agricu lture and allied act ivit ies 10% (2009/2010)

Some samples of leading companies, which are based in Maharashtra are:

•Reliance Industries Ltd – One of India’s largest conglomerates, which includeactivities ranging from petrochemicals, telecommunications & finance.

•ICICI Bank – India’s largest private sector bank

•Bharat Petroleum – India’s largest refining and petroleum retailing unit

•Larsen & Toubro – India’s largest engineering & construction conglomerate

KEY TAKEAWAYS

• Mumbai is the financial capital of India

• Home to India’s stock exchange

• 61% of income in services sector

MA

BI

WB

AP

MP

UP

UP Uttar PradeshUP Uttar Pradesh

MA MaharashtraMA Maharashtra

BI Bihar BI Bihar

WB West BengalWB West Bengal

AP Andrah Pradesh AP Andrah Pradesh

MP Madhya PradeshMP Madhya Pradesh


Source: http://mahades.maharashtra.gov.in, “Economic survey of Maharashtra 2010/2011, (2011); http://www.ibef.org, “Maharashtra”2010



©Lloyd’s

TAMIL NADU

Tamil Nadu is considered to be the most industrialised state in the country, alsoknown as the ‘yarn bowl’ of the country. It is the seventh most populous state inIndia.

The Gross State Domestic Product for 2008/2009 is about US$ 73.7bn.

The three major cities in Tamil Nadu are Chennai, Coimbatore and Madurai.

Key industries in Tamil Nadu are IT, textile, engineering and automotive. TamilNadu is also a favourite tourist destination.

The state attracted cumulative FDI inflows of US$ 5.7bn between April 2000and May 2010 and is amongst the states which attract the highest levels of FDI.

Tamil Nadu is the second-largest software exporter by value in India afterKarnataka.

The automotive industry contributes about 8% Gross State DomesticProduct, providing direct employment opportunities to about 300,000 people.

Some samples of leading companies, which are based in Tamil Nadu are:

•Madura Coats – Supplies threads to clients such as Levi’s, Tommy Hilfiger

•Ford Motor – main manufacturing plant has a capacity of 100,000 vehiclesannually and is located close to Chennai. Ford Motor Company has investedUS $500m to double capacity of the plant to 200,000 vehicles

• Amalgamations Group – One of India’s largest engineering conglomeratesheadquartered in Chennai

•Bharat Heavy Electr icals (BHEL) – Principal activities include manufactureand distribute electrical, electronic, mechanical and nuclear power equipment

•Cognizant Technology Solutions – Business Process Outsourcing (BPO)services, IT consulting services

KEY TAKEAWAYS

• Tamil Nadu is the most industrialisedstates

• Second largest IT hub

• Major textile & engineering hub of SouthIndia

Chennai

MA

BI

WB

AP

MP

UP



BI Bihar BI Bihar





Source: http://www.ibef.org, “Tamil Nadu”2010; http://www.cmie.com



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DELHI

Delhi is the capital of the Republic of India and also a state for administrativepurposes. It is one of the largest metropolis in the country. It is home to theunion government of the country and state government offices, hence is oftenreferred to as the political capital of the country.

The Gross State Domestic Product of Delhi for 2007/2008 was US$ 35.8bngrowing at an average rate of 15% over the last decade.

Key industries which are drivers of the Delhi economy are financialinstitutions, food processing, Information Technology Enabled Services(ITES), consu lting and tourism.

Due to its importance as a capital city, it is an important centre for trade andcommerce with key industry associations.

Some samples of leading companies & organisations, which are based in Delhi are:

•DLF – One of India’s largest construction company in the real estate sector.In 2008/2009 total revenue of the company was US$ 615m.

•National Agricultural Cooperative Federation of India (NAFED) –Headquartered in Delhi with its objective to promote cooperative marketing of agricultural produce to benefit the farmers

•NASSCOM – It is the premier trade body and chamber of commerce of the ITand Business Process Outsourcing (BPO) industry in India, and isheadquartered in New Delhi

KEY TAKEAWAYS

• Delhi is the political capital of India

• Major sectors are consulting & tourism

• Important centre for trade and commerceand key associations

New Delhi

MA

BI

WB

AP

MP

UP



BI Bihar BI Bihar





Source: http://www.ibef.org, “Delhi”2010; http://www.cmie.com



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ANDHRA PRADESH

Andhra Pradesh is on the south-eastern coast of India. Hyderabad is thecapital of the state and houses many banking and financial institutions.

The key growth areas identified in Andhra Pradesh are IT/ ITES,pharmaceuticals, bio-technology amongst other sectors.

The bio-technology market size in 2008/2009 stood at US$ 475m (18% of

total Indian bio-technology industry). It is also considered as a bulk drug capitalof the country, as half of the top 10 pharmaceutical companies in the countryare based here.

Despite strong pharmaceutical and a growth markets in bio-technology,agriculture remains and important sector in the state’s economy. AndhraPradesh is also considered as being a mineral rich state.

Some samples of leading companies, which are based in Andhra Pradesh are:

•Mahindra Satyam - Provides software solutions to electronics and electricalequipment manufacturers, aerospace and defence companies

•Microsoft India – Microsoft’s largest software development centre outside US

•Dr Reddy’s Laboratories - It ranks among the top 15 generics players in theworld (revenues of US$ 958m) and first pharmaceutical company in Asia-Pac(outside J apan) to be listed in NYSE

•Insurance Regulatory and Development Authority – The National agencyfor regulation of Insurance is headquartered in Hyderabad

KEY TAKEAWAYS

• Major sectors are IT & Pharmaceuticals

• Mineral rich state

• Insurance regulator (IRDA) is based inHyderabad

HyderabadMA

BI

WB

AP

MP

UP



BI Bihar BI Bihar





Source: http://www.ibef.org, “Andhra Pradesh”2010; http://www.aponline.gov.in; http://www.cmie.com



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KARNATAKA

The capital of Karnataka is Bengaluru formerly known as “Bangalore”.

Karnataka’s Gross State Domestic Product at2008/2009 prices was aboutUS$ 59bn, and it averaged at 11.8% growth in the last ten years.

It is home to some of India’s leading IT / ITES companies, and Bengaluru isoften referred as “Silicon valley of India”. The state also is home to some of the

premier life science institutions such as Indian Institute of Science andNational Centre For Biological Science.

Some samples of leading companies, which are based in Karnataka are:

•Wipro Technologies: Based in Bengaluru, it provides BPO, softwaresolutions and other consulting solutions to global companies around theworld

•Infosys: Infosys is a competitor in the same space as Wipro

•Bharat Earth Movers: manufactures a wide range of products such asearth moving equipments with revenues of US$ 825m in2009/2010

•United Breweries: It is India’s largest brewer with a turnover of US$ 400m in2009/2010. The group is also in the Aviat ion sector and ownsKingfisher airlines

KEY TAKEAWAYS

• Bengaluru is seen as the Silicon Valleyof India

• Leading sectors are IT, Pharmacy and Automotive

Bengaluru

MA

BI

WB

AP

MP

UP



BI Bihar BI Bihar





Source: http://www.ibef.org, “Karnataka”2010; http://www.cmie.com



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GUJARAT

Gujarat is known as the ‘Petro capital of India’. The capital of Gujarat isGandhinagar named after Mahatma Gandhi.

The city of Surat is known for its domination in the diamond industry as amajor centre of diamond cutting and polishing.

The Kandla port is one of the country’s largest ports. The world’s largest

ship breaking yard in the world is located in Alang, Bhavnagar.

Some samples of leading companies, which are based in Gujarat are:

•Parle – one of India’s largest manufacturer of biscuits, confectionary and juices

• Arvind Mil ls – one of the top producers of denim in the world and largestproducer in Asia

•Reliance Industries – The largest grass-root refinery in the world isowned by Reliance which is situated in J amnagar refinery

KEY TAKEAWAYS

• Major centre of d iamond cutting andpolishing

• Major centre for India’s refinery sector

• Largest ship breaking yard

Gandhinagar

MA

BI

WB

AP

MP

UP



BI Bihar BI Bihar





Source: http://www.ibef.org, “Gujarat”2010; http://www.cmie.com



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WEST BENGAL

The capital of West Bengal is Kolkata (formerly “ Calcutta” ) with a GrossState Domestic Product of around 8% (2007/2008) compared to other Indianstates. Calcutta was the old capital of India during the British Raj and was thenmoved to Delhi in the early 19th century.

West Bengal has the largest brackish-water resources forshrimp farmingand leading exporter of shrimps in India, which is the largest exporter o f

shrimps in the world.

West Bengal is the second largest tea growing s tate in India after Assam andaccounts for around a quarter of India’s tea production. West Bengal is alsoknown for being a leading exporters of finished leather goods.

Some samples of leading companies, which are based in West Bengal are:

•Tata Tea Limited – It is the largest brand of tea in India headquartered in

West Bengal

•Shyam Steel – Headquartered in Howrah, it is a lead manufacturer of steelre-bars and structures with a turnaround of over US$ 220m in2009/2010

• Arcelor Mittal – is the world’s number one steel company, and its designingand engineering centre in Kolkata serves the entire design needs of Arcelor Mittal, globally

KEY TAKEAWAYS

• Second largest tea producer in India

• Leading exporter of Shrimp

• Major exporter of leather goods

Kolkata

MA

BI

WB

AP

MP

UP



BI Bihar BI Bihar





Source: http://www.ibef.org, “West Bengal”2010, b)http://www.cmie.com



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Economics &

Politics

2



©Lloyd’s

Gross Domestic Product (GDP)

(nominal GDP levels in billion US$ ; Real GDP change)

9.1%

8.5% 8.4%8.6%

8.8%9.0%

7.9%

9.6%

5.1%

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

2007 2008 2009 2010 2011 2012 2013 2014 2015

0%

2%

4%

6%

8%

10%

12%

Economics & Politics> Economic Outlook > 1 of 2

GDP SIZE IN US$ BN GDP GROWTH

Source: IHS Global insight, IMF world economic outlook

REAL GDP SIZE (US$ BN) AND GROWTH CURRENT KEY ECONOMIC ISSUES

• India is the 10th largest economy in the world and4th largest in PPP terms

• Growth forecasts of 8% a year for at least the next 5years

• Economic liberalization, including industrialderegulation, privatization of state-owned enterprises,and reduced controls on foreign trade andinvestment, began in the early 1990s

• This has served to accelerate the country's growth,which has averaged more than 7% per year since1997

• The UK is one of the largest European investors inIndia and India the third largest investor in the UK,with bilateral trade in 2010 standing atGBP 13bn



©Lloyd’s

ECONOMIC MOMENTUM IN INDIA IS DECELERATING

• Following aggressive monetary tightening, the Indian economy will undergo moderation in the short term to below 8% growth

• India’s growth momentumwill likely return to its historical trend, expanding upward of 8.0% over the medium term and maintaining

healthy growth averaging 6.5% through the long term

• The development of India's world-class IT industry, coupled with the ongoing economic reforms, will further facilitate India's

increasing integration into the global economy

• Growth in the services sector will continue to outpace the rest of the economy, with manufacturing also growing

PERSISTENT PRICE PRESSURES REMAIN A KEY POLICY CONCERN

• The Reserve Bank of India (RBI) has beensteadily tigh tening monetary policy since March 2010, with the latest hiking of reserve

requirements and policy interest rates implemented on 25 October 2011

• It appears price pressures are broadening: price increases are not just affecting raw material but also manufactured goods

• CPI inflation is expected to remain elevated over the near term, at 9.1% in 2011 and 7.3% in 2012, higher than registered since

2000

INDIA’S EXTERNAL FINANCES CONTINUE TO SHOW STRENGTH

• External accounts remain healthy, IT and related services are expanding rapidly, transforming parts of the country into export

platforms, as well as generating employment and boosting consumer demand.

• Software exports consti tute 2% of GDP, but the IT and related services not only include software, but also business-process

outsourc ing activities such as accounting, procurement, insurance management, legal services, human resources etc...

• The current account will continue to incur deficits of less than 3% of GDP in each year over the medium term. The positive structural

changes in the external sector have resulted in the ongoing accumulation of foreign-exchange reserves.

Source: IHS Global Insight

Economics & Politics> Economic Outlook > 2 of 2



©Lloyd’s

INDIA HAS TRANSFORMED INTO A GLOBAL IT POWERHOUSE IN A DECADE

• India has transformed a £2bn industry into a £30bn industry over the last decade

• Indian exports in IT have grown by about 35% a year for the last 11 years

• The sectorhas survived 2 global downturns – the Dotcom bust in 2000 and the Global Financial crisis of 2008/9

• The ICT industrycontributes 6.1% of GDP, about 5 times its contribution of 10 years ago

BESPOKE SOLUTIONS GROWING RAPIDLY, 13% GROWTH DURING GLOBAL SLOWDOWN

• Domestic market and the appetite for new products and technologies tocreate bespoke solutions is growing rapidly

• The IT sector experienced anoverall growth of about 13%, with 6% in exports, amounting to over $70bn in revenues,

during the global slowdown

CONTINUING SHIFT TO BUSINESS PROCESS OUTSOURCING

• The IT and related services not only include software exports, butalso business-process outsourcing (BPO) activities.

Activities such as accounting, procurement, insurance management, legal services, human resources, medical

services, and other internal corporate control functions are also included.

• Hardware accounted for 21% of total revenue; BPO accounted for 18%; and engineering and R&D accounted for 18%.

India's indigenous IT firms are booming

• Some of the leading companies — Infosys and Wipro and the service subsidiaries of large conglomerates such as

Reliance and Tata — are emerging as global competitive brands.

Source: UKTI , Nasscom

Economics & Politics> Key Sectors > IT and related Services



©Lloyd’sSource: IHS Global Insight

OPENING OF INDIAN ECONOMY IN THE 1990’S LED TO REFORMS

• The opening up of the Indian economy in the 1990s led to a series of f inancial-sector reforms, prominent being the

banking and capital market reforms

• The banking system is relatively healthy, and access to capital is very good . Financial sector offerings are available in

the equity market, debt market, money market, derivative market, mutual funds, money market mutual funds, banking, and

insurance

BANKING SYSTEM DOMINATED BY PUBLIC SECTOR BANKS

• The banking system is dominated by public-sector banks, namely the State Bank of India, and nationalized banks; other

participants include development, private, and foreign banks

• There are six fully foreign banks in India, and the overall market is expanding at 15% per year

• New private sector banks reflect the high growth in the private sector ; meanwhile the public -sector banks are

slumping. Over the years, reforms in the equity markets have brought India's bourse to the standards of the major

global equity markets

INDIAN STOCK EXCHANGE HAS THIRD LARGEST INVESTOR BASE IN THE WORLD

• Today India's stock exchange has over 25 million shareholders (third-largest investor base in the world after the UnitedStates and J apan). The capital market is significant for degree of development, volume of trading,and tremendous growth

potential

• The debt market has undergone considerable changes in the last few years. Previously characterized by regulated

interest rates, limited players, and lack of trading, the markets have become more integrated and less regulated

Economics & Politics> Key Sectors > Financial Services



©Lloyd’sSource: UKTI, IHS Global Insight

LIGHT MANUFACTURING AND AUTOMOBILES

• Low-cost labour and a large domestic consumer market make India an attractive location for light

manufacturing investors from a range of industries. Indian industry produces practically all goods

• Years of voluntary isolation from the world's exports required local companies to be self-sufficient, leading to

widespread inefficiencies. Now, with the market universallyexposed to foreign manufacturing entrants, Indian

industry has been forced to become more productive

• International conglomerates Hyundai, Honda, Toyota, Ford, and GM have quickly entered the automobile market,

challenging domestic market leader Maruti

• In other industries, smaller entrants are rapidly making their mark in newly successful industries such as auto

parts, as well as India's traditional products like textiles and garments and jewellery

PHARMACEUTICALS

• The Indian pharmaceutical industry is one of the fastest growing sectors of the Indian economy and has made rapid

strides over the years

• Long self-sufficient, the industry has gained global recognition as a producer of low-cost, high-quality bulk drugs

and formulations

• The industryhas adapted its business model to the 2005 amendment of India’s patent law that reinstated product

patents for the first time since 1972

• In the last few years, several pharmaceutical companies have engaged in commercially viable R&D activities and

become signif icant players in the international market. Leading Indian companies include Ranbaxy Laboratories, Dr.

Reddy Laboratories, Nicholas Piramal, Cipla, and Biocon

Economics & Politics> Key Sectors >Manufacturing/Pharmaceuticals




ALREADY LARGE AND GROWING CONSUMER OF ENERGY

• India is the world’s 5th largest consumer of energy, and its demand for petroleum products is growing by more than 6%

per year

OIL CONSTITUTES INDIA’S PRIMARY ENERGY CONSUMPTION

• Oil comprises about33% of India’s primary energy consumption at present

• The majority of India’s oil reserves are roughly4.7 billion barrels

• Two large government-owned companies – Oil and Natural Gas Corporation Limited (ONGC) and Oil India Limited (OIL)

produce over 80% of India’s crude oil and natural gas, which provides 28% of India’s overall oil needs

HEAVY INVESTMENT IN RENEWABLES

• 65% of electricity is generated byThermal plants, 22% by hydroelectric power plants 10.7% by other renewable sources,

and 3% by Nuclear

• Wind energy has also been heavily invested in as well as solar power. By 2022 there is a plan to generate 22,000 MW of

Solar Power, 2/3 of that currently produced by nuclear stations

THE UK IS THE LARGEST INTERNATIONAL INVESTOR IN THE OILD & GAS SECTOR

• Due to pol icy and regulatory reforms, the power sector will generate opportunit ies for the UK in a number of areas

• These include: Energy efficient technologies; nuclear energy; renewables – offshore wind, biomass and solar

Economics & Politics> Key Sectors > Energy




Economics & Politics> Political Outlook ANTI CORRUPTION AGITATION STALLS REFORMS

• Protests over corruption scandals since late 2010 and over a controversial piece of anti-corruption legislation - the J anLokpal Bill 2011 - have significantly slowed down the government's ability to pass crucial reforms

• While this has dented investor confidence in the short term, there is a possibility that the recent agitation could havepositive effects on the ways that India will be able to address corruption in the future

• Previously under-reported, the issue of corruption has increasingly been taken up by the media, and even though thecurrent draft of the anti-graft bill is insufficient to tackle the various causes of corruption, it still marks some progress

GOVERNMENT’S ANNOUNCEMENT TO CARVE OUT SEPARATE TELANGANA STATE SPARKS PROTESTS

• Protests broke out across India after the government announced its intention to initiate the process of carving out aseparate Telangana state from the central Indian state of Andhra Pradesh in December 2009

• The announcement has raised hopes and fears among the myriad ethnic, religious and cultural minorities in the country

• Given the complexity of the matter, which could serve as a precedent for other regions seeking separate statehood,progress should not be expected soon. On 15 November, Uttar Pradesh chief minister Kumari Mayawati announced herintention to introduce into the state's legislative assembly a proposal to divide the current state into four smaller units

INDIA AND PAKISTAN REVIVE PEACE PROCESS

• India and Pakistan announced their return to peace talks on 10 February 2011, on hold since the 2008 Mumbai attacks

• The announcement, in which both sides said that they had agreed "to resume dialogue on all issues", represented asignificant move that has been welcomed by the international community

• However, as expected, there have been no advances on the key point of disagreement, the territorial dispute over Kashmir



©Lloyd’s

20120105 market intelligence india

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