service industryinvestment growth to 12 percent during fy 2016-fy 2018, the bank said in its...

NewsletterApril, 2015

International Chamber for Service Industry

Service Industry Voice of India

Issue 2015-04-2

Disclaimer: This information has been collected through secondary research and ICSI is not responsible for any errors in the same. Copyright © 2015 ICSI—International Chamber for Service Industry.

[email protected] | www.icsiindia.in All other materials & logos copyrighted to their respective owners

INDIA'S GDP GROWTH RATE TO REACH 8% BY 2017: WORLD BANK

Given India's weight in regional Gross Domestic Product, the projections reflect to a large extent India's expected growth acceleration, driven by business-oriented reforms and improved investor sentiment. Source: Ministry of I n f o r m a t i o n a n d Broadcasting

The World Bank has predicted a G D P growth rate of 8 percent for India by 2017 and said that a strong expansion in the country, coupled with favourable oil prices, would accelerate the economic growth in South Asia. In India, GDP growth is expected to accelerate to 7.5 percent in fiscal year 2015/16. It could reach 8 percent in FY 2017/18, on the back of significant acceleration of investment growth to 12 percent during FY 2016-FY 2018, the bank said in its semi-annual report.

The country is attempting to shift from consumption to investment-led growth, at a time when China is undergoing the opposite transition, it said. The bank's twice-a-year South Asia Economic Focus report projected steady increase in regional growth from 7 percent in 2015 to 7.6 percent by 2017 on grounds of strong consumption and increasing investment.

INDIA SEES RISE IN STUDENT ENROLMENT: UNESCO REPORT

There are wide disparities in students' achievement of basic skills across states even as India has succeeded in enroling more children, according to a UNESCO report, which also underscored the need to address issues such as the rising number of contract teachers and teacher absenteeism.

The report said an extra $22 billion a year was needed on top of already ambitious government contributions in low and middle income countries to achieve the new education targets now being set for the year 2030.

Just one third of countries achieved all of the measurable Education-for-All goals set in 2000 while only half of all countries achieved the most watched goal of universal primary enrolment.

Issue 2015-04-2

1 Copyright ©2015 ICSI

Management

COMPANIES GET ARMY'S HELP TO TRAIN YOUTH IN J&K

Imtiyaz Ahmad Bhat is packing his bags to join Tata Consultancy Services in Kolkata later this month. His journey from Watlar in Jammu & Kashmir's Ganderbal district to landing a job with India's leading IT company typifies the success of a recent initiative by TCS to team up with the Indian Army under the Centre's Udaan scheme that aims to help educated youths in the insurgency-hit state get jobs with top companies. Bhat, 25, was on the lookout for job opportunities after completing hisgraduation from Kashmir University in 2013.

Las t yea r he responded to an advertisement in a local paper, which led to a t e l e p h o n i c interview with T C S a t B a d a m i B a g h Cantonment in S r i n a g a r . Following his selection, he began his training at the company office in Kolkata. "The experience was excellent. I was taught how to present myself in a management environment," said Bhat, adding that after the training he was offered a permanent position with TCS in Kolkata.

Although TCS, along with a clutch of other companies, had been visiting J&K to offer employability training to youths since Udaan was launched three years ago, the recruitment was limited to universities and major districts and towns. Involving the local army units in this process has opened a plethora of avenues for small-town candidates, the army officials involved in the process said, explaining that the local units helped primarily in conducting background checks on the candidates coming in for telephonic interviews.

Bhat was among the nearly 100 candidates selected for the 14-week training programme in Kolkata, some of whom could be provided permanent positions in the company. TCS has interviewed 335 candidates from the Kashmir region, 251 in Jammu and 246 in Ladakh since the selection phase began in November 2014. "The first challenge, when the process started in 2012, was mobilisation of youth, which is why the company began expanding and reaching out to local universities and

Issue 2015-04-2


Management

government. Last year, using the military's help, we were able to reach out to 19 districts," said RanjanBandyopadhyay, global HR head-BPO services at TCS. These districts include some of the regions considered hotbeds of insurgency such as Anantnag, Baramullah and Pulwama. Bandyopadhyay said the army units deployed in small towns made the company's task easier at a time when the devastation caused due to the massive floods had made it difficult for corporates to engage with the youths directly. "This is the first time an organisation has reached out to the army for help in recruitment," said an army officer, adding, "We also spread the message about the recruitment across villages, motivating the youth to come forward and utilise the opportunity."

The initiative has played a major role in integrating the youths from J&K with the rest of the country, said Bandyopadhyay. "Initially we would hire trainees for our Kolkata and Bengaluru offices, but from this year we are sending them all across the country which makes for greater integration," he added. The Udaan scheme is funded by the National Skill Development Corporation. TCS has signed a memorandum of understanding with NSDC under which it envisages providing training to 850 youths from J&K, of which 527 have already been trained.

TATA M O T O R S ' J A G U A R L A N D ROVER MAKES HISTORY IN BRITAIN Tata Motors, the home-grown automaker, recently added a new milestone in its history with Jaguar Land Rover's Solihull Manufacturing Plant beginning the production of the all-new Jaguar XE at the facility. This finally marks the addition of the Jaguar brand to the plant and the official opening of its state-of-the-art 500 million pounds 'factory within a factory'.

In its 70 years, the Solihull factory has been home to the Land Rover brand and is famous for the production some of the most iconic cars i n a u t o m o t i v e history. The Jaguar brand's arrival to Solihull is the latest amongst the significant developments for the site - its production has almost trebled and the workforce has doubled in just 5 years. About the 500 million pounds 'factory within a factory' - it is the largest single investment in the Solihull plant in

its 70 year history and comprises a new body shop, and trim and final facilities. Furthermore, 55 UK based suppliers have been awarded £4bn in contracts to support the introduction of the all-new Jaguar model.

Alan Volkaerts, Solihull Operations Director, said, "This really is an incredibly special day for Jaguar Land Rover a n d t h e team here at S o l i h u l l , m a n y o f whom have witnessed the plant change beyond all recognition in recent time. The arrival of the new Jaguar XE marks a new chapter in the history of this plant and showcases the flexibility of our manufacturing operation thanks to a strategic investment in aluminium technologies and infrastructure.”

The beginning of XE's production at the Solihull plant will be followed by that of the Jaguar performance crossover, the F-PACE. Together, the two cars could raise the facility's annual output by 50 per cent to 360,000.

Issue 2015-04-2


Management

FUTURE TRENDS- FOCUS RETAIL

Retail Trends and Predictions for Coming Years.1. Boomers and millennials will continue to heavily

influence retail. Retail in 2015 will continue to be driven by the needs

and preferences of two prominent generations: baby boomers and millennials.

2. Social networks will serve as shopping platforms. Over the last several years, brands have used social

media to market their products, talk to customers, and even make merchandising decisions; but in the coming months, we anticipate merchants to add "selling" to the list of things they can do on social sites.

3. Brands will double down on Corporate Social Responsibility.

Consumers these days are more drawn to retailers that invest in Corporate Social Responsibility (CSR). A survey by Cone Communications and Echo Research uncovered that 87 percent of global consumers factor in CSR into their purchase decisions.

4. Loyalty-wise, the points-for-purchases model will no longer be effective.

Enriching and personalizing the shopping journey will no longer be limited to tailored product recommendations and offers. Forward-thinking retailers will find additional ways to make each customer's experience unique and memorable. We predict that one of the areas that they'll focus on is customer loyalty.

5. Retailers will adopt and experiment with technology. Merchants will adopt and/or experiment with tech

innovations and figure out how they can use them to improve the shopping experience.

6. Mobile will continue to grow in all directions. Mobile will show no signs of slowing down next year

and we anticipate smartphones and tablets to play bigger roles in the shopping journey.

Issue 2015-04-2


IT Newsletter

Myntra to reportedly shut its website on May 1

Flipkart owned Myntra will close its website to become solely a mobile app based retailer from May 1

Online fashion retailer Myntra will shut its website on May 1 and will become a mobile app-based retailer, according to reports.Times of India citing sources close to the matter reveals that Myntra is expected to shut down its website in favour of moving all operations to its mobile app. The move is attributed to the increase in Internet usage via smartphones in India. Myntra gets about 80% of its traffic and 70% of sales through its mobile app. Flipkart also draws 60 percent of its sales through the mobile app.

According to reports, the company expects Myntra sales number through its mobile app to reach 90% by the end of the year. And if this experiment is successful then Flipkart may also follow suite. Flipkart had acquired fashion retailer Myntra last year for $300 million.

Flipkart, Myntra along with other leading Indian ecommerce players like Snapdeal, Infibeam have been pushing offers exclusively on their apps with the aim of getting more consumers on to the platform. According to reports, online retailers have seen an increase in mobile traffic from less than 5% an year ago to 50-60% now.

India is expected to have 213 million mobile internet users by June 2015, according to a report by IAMAI. By 2018 this number is expected to increase to 500 million by 2018. The rise in number is driven by increase in number of budget devices and low cost internet plans. A recent Morgan Stanley report has highlighted that online shopper penetration in India will increase from 9% in 2013 to 36% in 2020 driven by mobile users.

Now you can run Android apps on PCs, MacsGoogle might have made it possible to launch Android apps on almost any device as part of the latest developer preview of its App Runtime for Chrome (ARC) project.

The new features make it so that ARC can run on any desktop OS that has the Chrome browser installed, and opens up the ability to launch Android apps on Windows, Linux, Mac OS X and Chrome OS, according to Ars Technica.

Google's updated ARC project also allows developers to run their app on ARC via a new Chrome app packager, and the only platform excluded is of course iOS.

Originally Google ARC was designed to let Android apps run on Chrome OS. However, shortly after it was launched, a hack found the full potential of the project to run on any machine, and that has now been added as a full feature. ARC is able to run Windows, Mac, Linux and Chrome OS through a Native Client (NaCL), which is a sandboxing technology that lets Chrome apps run at close to native speeds and fully harness a machine's CPU and GPU.Is it that easy?

Of course it isn't as easy as that and developers will need to play around with the ARC Welder and submit the app to the Chrome Web Store before it can actually run. What ARC and the NaCL do is champion Google's strategy to make sure that developers write more apps for the Android ecosystem and they then work on more devices than ever - never a bad thing from a consumer point of view.

India to soon have an emergency numberHe Telecom Regulatory Authority of I n d i a ( T R A I ) h a s r e l e a s e d r e c o m m e n d a t i o n s o n i m p l e m e n t a t i o n o f a s i n g l e emergency number across the c o u n t r y . A c c o r d i n g t o t h e r e c o m m e n d a t i o n s o n implementation of 'Single number based In tegra ted Emergency Communication & Response System (IECRS), the number '112' is to be chosen as a single emergency number for India. Calls made to '112' from a landline or mobile phone will be routed to a Public Safety

Issue 2015-04-2


IT Newsletter

Answering Point(PSAP) which would be similar to a call centre. The number of such PSAPs in a state or union territory will be decided by their respective governments provided that there's at least a single such centre in each state/UT.

The Trai has also recommended that existing emergency numbers such as 100, 101, 102, and 108 will be retained a s s e c o n d a r y numbers and calls m a d e t o t h e s e should be re-routed to 112 in the future. The numbers can be withdrawn once calls to the secondary numbers reduce considerably. Access to the 112 emergency numbers will be permitted even from phones where outgoing calls have been barred or service is temporarily suspended. Users will also be able to access the service via SMS.

As per the authority, telcos will have to provide location information and details of callers to the Integrated Emergency Communication & Response System. For the same purpose Trai has recommended the setting up of four regional database centres in each metro city by BSNL.

The authority has also said that there should be a multi-sectoral agency with representations from Ministry of Human Affairs, Department of Telecom, and Department of Electronics and Information Technology, among others to coordinate and help in setting up the Integrated Emergency Communication & Response System.

Airtel Zero: Another blow to net neutrality

Airtel has launched 'Airtel Zero,' a platform through which it will offer users free access to certain mobile apps. These apps will be from developers who have signed up with the company. Through the scheme, app developers and internet content service providers (or over-the-top content providers) will be able to make some part of or their entire mobile app free for customers. This implies that users will not have to pay data charges (or get usage allowance deducted from their data packs) when they access these apps via Airtel's mobile data network. It's

worth pointing out that Airtel Zero violates the principles of net neutrality as the company will offer an advantage to certain players in terms of cost of access and will even promote them. These players will most likely shell out a fee to get this favourable position. While Airtel will get an additional source of revenue, for service and app providers, it will be an additional expenditure just to ensure that they don't lag behind their competitors.

Airtel claims the platform is similar to providing toll-free numbers for customer care and says Zero is 'an open and non-discriminatory marketing platform for all developers in India - irrespective of the size of their business."We believe that this platform is consistent with India's Digital Inclusion agenda and also contributes to the government's 'Make in India' vision by providing a platform to millions of small businesses to reach out to the end consumer.", said Srini Gopalan, director - consumer business, Bharti Airtel (India).

Interestingly, the move comes a few days after TRAI floated a consultation paper on net neutrality. Net neutrality implies that all websites and services should be treated equal and there should be no discrimination in terms of speed and cost of access. This means that a telco can't block a certain website (because of commercial or other interests) or promote one service over the other. It also means that an internet provider or telco cannot throttle speeds for one service or charge extra.

Airtel did not reveal the names of mobi le apps that are already part o f t h e p l a t f o r m . N e i t h e r d o e s i t inform the nature of agreements or fees that developers will need to pay to Airtel to sign-up for the platform. According to a report by MediaNama, Flipkart has signed up with Airtel for the Zero platform and is paying the telecom operator Rs 1000/gb data transfer as part of the deal. However, both Airtel and Flipkart have refused to comment on the tie-up. To recap, the Trai has asked for views on net neutrality in the Indian context. If you don't want your mobile operator to charge extra for WhatsApp, Skype or YouTube and promote its own services over the others, submit your responses to TRAI's twenty questions to the authority before April 24, 2015.

FUTURE TRENDS: India's public cloud services market to top $800 million: Gartner

Publ ic c loud se rv ices market in India is expected to grow about 33% to touch $838 million by the end of this year, driven by strong g r o w t h i n c l o u d infrastructure and security solutions, research firm Gartner said. The public cloud services market stood at about $632 million in 2014. High rates of spending on cloud services in India is expected to continue through 2018 and the market is poised to reach $1.9 billion by the same time, Gartner said in a statement.

"In 2015, public cloud services revenue is driven by high rates of growth in key market segments, cloud infrastructure as a service (IaaS), cloud management and securi ty services and cloud application infrastructure platform as a service (PaaS)," it said. Cloud computing refers to a pay-per-use model of computing where applications and software are accessed over the internet and not owned by users.

IT companies can save huge costs on these products as they would not have to invest in purchasing them, resulting in reduced IT costs. Some organisations, especially larger ones, set up a cloud-like infrastructure in their own data centre to secure data, which is called a private cloud. Public cloud refers to providers such as Amazon, Google and Salesforce.com, whose shared services are available to all. Spending on IaaS is expected to total $104.8 million in 2015, an increase of 38% over last year. On the other hand, spending on cloud management/security and PaaS is forecast to grow at 35.4% to $56.7 million a n d $ 8 4 . 6 m i l l i o n , r e s p e c t i v e l y during the same period.

"Organisations in India seeking IT outsourcing services are increasingly turning to public cloud services as an alternative to traditional ITO offerings," Gartner research vice president Ed Anderson said. In fact, cloud services are not only being used for low-value or transient workloads but also increasingly for production workloads, including some mission-critical initiatives, he added.

According to Gartner's cloud adoption survey, 53% of organisations in India indicated they are using cloud services today, with another 43% indicating plans to begin using cloud services in the next 12 months. "Business process as a service (BPaaS) is expected to grow from $130 million in 2014 to $351 million in 2018. SaaS is expected to grow from $246 million in 2014 to $707 million in 2018," Gartner senior research analyst Fred Ng said. The growth of cloud services varies by country and specific cloud service type and the Indian market is unique in that demand is consistently high for all types of cloud services, he added.

Issue 2015-04-2


IT Newsletter

M-commerce market in India to touch $19 billion by 2019: Study

As smartphone sales continue their journey north surging by 51% every three months, the mobile commerce (m-comm) market may grow by 55% from its present size of $2 billion to $19 billion by 2019, a study said.

According to a study released by market research fi r m , Z i n n o v , "right from user r e s e a r c h t o product anytime and anywhere , smartphones are an emerging point of purchase and to address the demand from upcountry markets and changing consumer shopping pattern, e-commerce companies are increasing their focus on mobile commerce". The survey found over 91% of the consumers had researched a product or service on their phone while online transactions on the smartphone platform rose between 30-50% in the upcountry areas. Further, it said 54% of the consumers have purchased either a product or a service from their smartphones.It opined that major e-commerce players like Flipkart and Quikr are serious about their plans to augment the m-commerce platform.In 2014, 81 million units of the smart gadget were shipped to the country.

"Smartphones are already outpacing the growth of feature phones and are expected to show a massive 36% CAGR over the next five years making it to the 651 million mark by 2019... The unstoppable surge of smartphones in India continues with 29% of urban population with a base of 409 million users adding to its adoption," the research firm said in a statement.

Issue 2015-04-2


AIRLINES, TOURISM AND HOSPITALITY INDUSTRY

1 8 M I L L I O N I N D I A N S T R AV E L ABROAD IN 2014

The average length of outbound Indian traveller is expected to increase significantly.India's economic rise will introduce a new generation of middle class tourists to overseas travel.

Indians made over 18 million outbound trips in 2014, an increase on the 16 million trips made in 2013. Barely two per cent of India's population currently travel overseas but over the past five years the country's middle classes have increased by over 10 per cent. This demographic is set to grow from 32 per cent at present to 50 per cent by 2030, making it a major source market with tourism boards vying to tap into this potential tourist goldmine.

India is expected to increase its business travel and tourism following the election of Narendra Modi's Bharatiya Janata Party (BJP) pro-business government in May 2014. However, outbound tourism will be challenged by the domestic tourism industry, which is expected to experience a surge in business confidence, shown by its average of nine per cent annually over the historic period.

Indian travelers characteristically h a v e b e e n avid business travelers with 40 per cent of all d e p a r t u r e s accounted for b y b u s i n e s s trips. While most of this MICE tourism has been consistently to the Asia-Pacific region, TTIC expects

that changing trends in India's economy will spur a rise in leisure and VFR travel to the Middle East and Europe over the forecast period. Key destinations include Thailand and UAE, as well as increasing visitors to the US. Although outbound tourism is growing, domestic investment could threaten the dominance of international trips Length of TripIndian outbound trip length continues stable growth The average length of outbound trips (number of nights) stood at eight nights in 2013, with little change since 2012. However, TTIC expects Indian travelers to increase the length of their outbound trips over the forecast period in line with the potential economic growth currently taking place. Consequently, length of overnight stays is forecast to increase to nine nights by 2019.

Domestic travel is threatening to overtake outbound tripsIndia i s current ly exper iencing a domest ic tourismboom. The number of domestic trips reached over1.3 billion in 2014, representing a 14.1 per centincrease on 2013 figures. This accounts for morethan three-quarters of India's entire tourism market, more than double the growth rate of outbound departuresduring 2014. Part of the rise of domestic tourismcan be attributed to growth of lower middle classincomes - the type of domestic consumer who cannot afford the flight prices to journey abroad, but who want to turn a religious pilgrimage into a family holiday.

Since 2010, many Indians who once had intentionsof traveling abroad had their plans curtailed because of the sharp fall in the rupee, which lost much of its value against the dollar, causing planned foreign holiday travel to become too expensive for many of the aspiring middle classes. Interestingly, this has increased domestic tourism throughout the country with international hotel groups reflecting this emerging market as Starwood French Group, Accor and the Hilton Group all look set to benefit.

7

S A R O VAR O P E N S D A S AVATA R A-THEMED HOTEL IN TIRUPATI

India's first theme hotel inspired by the 10 incarnations of Lord Vishnu Sarovar Hotels & Resorts has launched a property -- MarasaSarovar Premiere -- in Tirupati. The hotel is conceptualized and designed around the Dasavataras of Lord Vishnu. The property has 121 rooms and suites, according to a statement from the company.

"Tirupati is one of India's most visited pilgrimage centres. The existing demand-supply gap in this temple town offers a huge opportunity for hospitality brands. Every brand which was earlier in the luxury segment now wants to have a piece of the business here. We believe that TirupatiYatra is no longer about an arduous journey to meet Lord Venkateshwara, it is nirvana luxe," Anil Madhok, managing director, Sarovar Hotels & Resorts, said.

"MarasaSarovar Premiere Tirupati is India's first theme hotel inspired by the 10 incarnations of Lord Vishnu. It a ims at providing luxurious and affordable accommodation. The newly completed hotel ensures that a visit to Tirupati no longer entails compromising on personal comfort. Till date many visitors to the temple and otherwise opted on a day trip to Tirupati due to the limited choice and quality of existing accommodation. This is no longer the case with the opening of the MarasaSarovar Premiere as the hotel sets the standards in not only accommodation but also offers choices of dining options, spa, health club, swimming pool," YogeshPrajapati, director, Finance, Marasa Hospitality and owner of the hotel, said. Sarovar Hotels & Resorts is a hotel management company which manages and franchises over 70 operational hotels in 48 destinations in India and overseas, under Sarovar Premiere, Sarovar Portico, Hometel, Radisson, Park Plaza and Park Inn brands. The brands cover the 3, 4 and 5 star spectrum. The Madhvani Group, which was also part of the project, is a private sector conglomerate in East Africa. It owns a portfolio of business interests in several countries particularly in East Africa and India.

Issue 2015-04-2



RADISSON RED BRAND LAUNCHED IN INDIA

Carlson Rezidor Hotel Group has launched its new Radisson Red hotel brand in India, a key market in which Carlson Rezidor is established as the number one international hotel operator by number of hotels. The launch of this upscale Lifestyle Elect brand is part of Carlson Rezidor's expansion plans for India, which are aimed at extending the group's lead in a country where it currently has 74 hotels in operation and 43 more in the pipeline.`

"The economic outlook is optimistic and the demand for rooms in India has been growing by double-digit percentages over the past decade and this is expected to continue for the next few years. Domestic travel is growing and international arrivals are on the increase. This is a market that is prime for our Radisson Red brand, which is positioned to address the needs of savvy travelers, while meeting the expectations of bottom line-focused owners. Radisson Red offers a differentiated guest experience, with lower construction and operating costs than traditional upscale hotels due to a multi-functional approach to design and efficient space-planning. Radisson Red also gives owners the flexibility to customize the specifics to cater to the unique demands of each locale," said Thorsten Kirschke, president, Asia Pacific, Carlson Rezidor Hotel Group.

Radisson Red is a new hotel concept where the focus is on design and detail, choice, personal interaction and technology. Its Lifestyle Elect proposition enables guests to elect the type of stay experience that best reflects their lifestyle. Radisson Red offers a non-traditional stay experience that combines work and play, and appeals to the growing millennial-minded segment. This key segment cuts across age groups to include all travelers who seek unique experiences when they travel and who have an affinity for technology and a lifestyle that integrates work and play.

To ensure that guests always stay connected, Radisson Red provides Free Internet to all. Upon arrival, guests enter a Hi All Gallery where locally-inspired art is incorporated into the overall design. And instead of typical meeting facilities, guests can book an event studio with state-of-the-art technology for meetings or

8

gatherings. Red Cafe, Oui Bar and the 24-hour Red Deli, are connected, open and social spaces that set the scene for interaction and games. To cater to local market needs, Radisson Red hotels in India will have an option of a full service restaurant. Guests can dine at the restaurant or enjoy in-room dining while working in their rooms, which are designed with usage flexibility in mind. The traditional guestroom desk makes way for a multifunctional table at which guests can work, eat and surf the internet. Guests can also enjoy a movie on the super-sized TV screen with surround sound using content from their personal devices.

The first Radisson Red hotel was signed in October 2014 in China. Radisson Red Shenyang Hunnan, part of a twin hotel development which includes Radisson Blu Shenyang, is scheduled to open in 2016. In India, Radisson Red will be ideal for primary/secondary such as Ahmedabad, Benguluru, Chennai, the Delhi-NCR, Hyderabad, Kolkata, Pune, Lucknow, Mumbai and Pune, as well as leisure and religious destinations suchas Goa, Jaipur, Katra, Shirdi, Tirupati. Carlson Rezidor expects to have 60 Radisson Red hotels globally by 2020.

Issue 2015-04-2



A NEW AIRLINE HAS TAKEN TO THE SKIES IN SOUTHERN INDIAAir Pegasus launched its first flights fromBengaluru's Kempegowda International Airport on 12 April 2015, and will initially offer connections to the cities of Hubli, in Karnataka state, and Thiruvananthapuram, inKerala, using a fleet of two 66-seat ATR turboprop aircraft.

And the airline's managing director, Shyson Thomas, told reporters at the launch that h e p l a n s t o e x p a n d t o a number of new d e s t i n a t i o n s across southern India.

"We aim to be t h e t r u l y regional airline brand with more connectivity in existing regions which are undeserved and to connect non-connected sectors," Thomas was quoted saying by the Press Trust of India.

Future destinations for Air Pegasus are likely to include Kochi, Chennai, Tuticorin, Belgaum and Rajahmundry, Pondicherry and Madurai. Air Pegasus becomes the third new airline to launch in India in the last 12 months, followingAirAsia India and Vistara.

9

FUTURE TREND IN TOURISM INDUSTRYGOVT SEEKS TO PUT IRCTC ON HIGH GROWTH PATH; WANTS IT TO EMULATE FLIPKART The Indian Railway Catering & Tourism Corporation, which operates one of the country's biggest e-commerce portals, plans to hire a consultant to help it assess and i n c r e a s e i t s valuation, a move seen as the first step to a public listing. "We are trying to exploit the site. Our growth will come from there. We have been asked by the government to grow like Flipkart," chairman and managing director AK Manocha told ET. "The government wants to monetise railways assets. IRCTC has started speaking to consultancies. For now, it is just evaluating and seeing how much it can fetch if it goes for an initial public offering.

The unit of Indian Railways expects to post its highest ever net profit of Rs. 85 crore on revenue of Rs. 1,000 crore in the year ending March 31, on the back of growth in e-ticketing and the introduction of several trains last year, director, finance, MP Mall told ET. Profit is expected to increase 35% to Rs. 115 crore in the next financial year, driven by new services and advertising revenue, said Manocha. IRCTC is targeting Rs. 10,000 crore of revenue by 2025.

IRCTC stands as a contrast to other ecommerce companies. Flipkart, the country's largest e-tailer, is valued at close to $11 billion even as it continues to post losses after six years of operations. Other online portals, including Makemytrip, Yatra and Cleartrip, are also in the red. For IRCTC, the most valuable part of the business is the e-ticketing segment, industry sources told ET. The corporation sells e-tickets worth Rs. 20,000 crore annually compared with Flipkart's gross merchandise sales of about Rs. 25,000 crore. IRCTC earns a commission on each ticket sold, which makes up for 30% of its revenue and 60% of profit. Other segments - catering and tour packages - which account for 30% of revenue each will get lower valuations.

“If I was to do a fair value of this, it will be somewhere in the $500 million-$750 million (Rs. 3,150 crore-Rs.4,700 crore) range. Though it is a conjecture, the government will expect at least 3-4 times that number," said an investment banker on condition of anonymity. Industry sources sounded cautious, given that IRCTC is heavily dependent on Indian Railways for the bulk of its business. According to them, the value of this asset in the government's hands would be very different than if it was with a private entrepreneur. "IRCTC has a huge potential. It has a captive customer base. The traffic is from the middle-income bracket, which makes for the core of Indian consumers," said ArvindSinghal, MD at Technopak, a management consulting firm. "However, it has to figure out which part of the e-commerce game it wants to play.

Customers who visit IRCTC would be interested in hotels, tourism. They can scale up on hotel and cab aggregation. They can increase their focus on food offerings. There is no limit on what IRCTC can do," he added.

Issue 2015-04-2


Skill Development

Govt Brings Training (ITI), Apprentice Divisions Under Skills Ministry The National Democratic Alliance (NDA) government has moved the training and apprentice divisions of the labour ministry to the skill development and entrepreneurship ministry that was formed in November.

The move brings over 11,000 industrial training institutes (ITIs) and scores of other institutions, and the apprentice and training divisions, under the skills ministry, empowering it.

Nearly a million-and-a-half students pass out of ITIs every year, a critical cog in India's skills mission. The labour ministry has a target of skill-training 100 million people by 2022, second only to the target for the National Skill Development Corp. (NSDC), which must train 150 million by the same period. The NSDC comes under the skills ministry.

As a result of this decision, which the labour ministry was opposing for months, the skills ministry will not only oversee the skill development activities of all ministries and departments, but actually implement schemes, said at least two government officials.

The cabinet secretariat made the decision in this regard on Thursday, said the first government official with direct knowledge of the development. "All private ITIs, government ITIs, PPP skill schools and other institutions will come to skills ministry. The cabinet secretariat will decide on the budget part in next few days," the person said.

A labour ministry official confirmed the development, adding that the directorate general of employment and training (DGET) will now "lose its charm". From the 1950s, the labour ministry has been running this department and has created tangible infrastructure and trained millions of students for the manufacturing sector, the official said.

“At a time when the labour ministry is revamping the DGET, modernising ITIs, creating an online skills repository, you are taking away the division. Without the training division, DGET will be left with just employment exchanges," said the official, adding among central ministries, labour has done better in skill training for years and was way ahead in 2014-15 too.

According to data collated by the National Skill Development Agency (NSDA), part of the skills ministry, 21 departments and ministries were supposed to train 10.5 million people in 2014-15, but only 5.1 million people were trained till 28 February. Among the bigger ministries, the ministry of labour and employment has done relatively better, achieving more than 89% of its 1.62 million-plus annual target.

The first official said that the apprentice division of the DGET too has been transferred, which means the skills ministry will implement the amended Apprentices Act, which allows students to get trained in shop floors and get financial assistance.

"This indicates government is serious about the skill ministry," said Narayanan Ramaswamy, partner and head, education and skill practice, at consulting company KPMG. "Till date, what the labour ministry has done has not got enough traction and outcome, at times, are questionable. The new ministry will now improve monitoring, consolidate and bring in a single umbrella of rules. But the skills ministry has to keep in mind that they need to collaborate than compete," he added.

Govt To Make Skill Certification Mandatory For Public Sector Jobs The government will make skills certification essential by 2020 before a person can apply for a public-sector or government job, a decision that could be difficult to implement. "To get a government job, it is very important to have a NSQF (national skill qualification framework) certification and this is how the government is planning to move," skills minister Rajiv Pratap Rudy said on Thursday.

By 2020, "government advertisements would have NSQF requirements to get into government jobs," Rudy said while unveiling a skills gap report in 24 selected sectors ranging f rom automobiles to textiles.

10

“The recruitment rules of the government of India and PSUs (public sector undertaking) of the central government shall be amended to define eligibility criteria for all positions in terms of NSQF levels," the ministry said in a note. "The state governments and their PSUs shall also be encouraged to amend their rules on above lines.”

The framework proposes to measure skills and accomplishments on a scale of one to 10, from entry to doctorate levels. The government will stop funding training and education programmes that are not NSQF compliant from 27 December 2016. The certification system will become mandatory two years after that. That will leave candidates a buffer of just two years to acquire the desired certification level, which could prove to be a tough task.

The government's decision to put in place a national certification framework is a practical and welcome move, said Narayanan Ramaswamy, partner and head of the education practice at consulting company KPMG. Although there will be some teething issues, the government can achieve it, Ramaswamy said, pointing to the success of the mandatory teacher training courses and teacher eligibility tests for appointment. But he said, integrating vocational education with school and college education is critical for the proposed framework.

Nearly 1,900 schools are offering vocational programmes now and it has to be scaled up both at school and university levels, said DilipChenoy, chief executive of the state-run National Skill Development Corp.

The skills gap report said India's labour market will expand to 578.62 million in 2022 from 459.46 million in 2013. Although 23 sectors would need more people by 2022, agriculture may see a reduction of 25 million between 2013 and 2022, the report said.

This requirement for additional people across sectors will be crucial in terms of skills training and helping India reap economic benefits, Rudy said. If the country wishes to achieve double-digit economic growth, skills will be key, the minister said, and expertise in manufacturing sector jobs will have to get special importance. The ministry's latest report will guide all government departments in taking up actionable projects on skill development and help in ensuring demand-driven, rather than supply driven, training to ensure employability, skills secretary Sunil Arora said.

Issue 2015-04-2


Skill Development

GE Healthcare Launches Skill Development ProgramT h e c o m p a n y h a s partnered with healthcare and education experts to build programmes for s t u d e n t s a n d p r o f e s s i o n a l s . G E Healthcare aims to set up at least one healthcare education and training institute in each state. GE Healthcare, an arm of General Electric Co., on Monday launched a mission to accelerate the building of a 'Yogya Bharat,' or Skilled India that aims at creating a 100,000-strong skilled healthcare workforce.

The company has partnered with healthcare and education experts to set up healthcare education and training institutes that will provide accredited skill building programmes for students who have passed the 12th Standard and skill enhancement programmes for existing healthcare professionals. GE Healthcare aims to set up at least one healthcare education and training institute in each state and has already signed Memorandum of Understanding with institutions-both in government and the private sector. The first institutes will start operations in Mumbai, Greater Noida, Bhatinda and Bhubaneshwar. The Mumbai institute is already functional and is fully funded and run by GE Healthcare

11

Future Trend: Skills Development

Issue 2015-04-2


Media & Entertainment Industry

PM to explore new infrastructure for northeast employmentTaking note of the unemployment problem in the northeast, Modi talked of various employment-generation schemes for Northeastern states. At Sangai Festival at the Bhaigyachandra Open Air Theatre in Imphal East in December 2014, Modi said the Centre' decision to set up a sports university in Manipur would promote sports in the region and boost employment. Though he did not spell out any package, he underscored the need to boost tourism in the northeast.

Plans are afoot to recruit youth from the northeast in Delhi Police, Modi said. He also reiterated his promise to send 200 policewomen from the northeast to Gujarat on a two-year deputation to enhance national integration. The assurance found resonance among people who have at times been targeted in hate crimes in Delhi and elsewhere.

Prime Minister NarendraModi called for developing such next-generation infrastructure including setting up of optical fibre network in the Northeast which would create immense job opportunities within the region, in the process checking large-scale emigration of youth from here to other states.

"What the Northeast needs now is next-generation infrastructure including information highways that would create immense employment opportunities within the region. Improved connectivity on the other hand will trigger off huge domestic tourist flow to the region. With our government already allocating Rs 28000 crores for the region in the last railway budget, the Northeast is definitely heading for new heights of development," the prime minister said.

He was flagging off by remote switch the first train from Mendipathar (in Meghalaya) to Guwahati as also laying foundation stone of the Bhairabi-Sairang railway line in Mizoram.

"Times are changing, and so is the world. Northeast today needs gas grid, safe drinking water, round-the-clock electricity. Infrastructure has to be built keeping in mind the requirements of life of changing times," he said. Once optical fibre is in place, young people from the Northeast will not require to flock to places like Bangalore and Hyderabad in search of jobs. Call centres can then come up even in remote corners of the Northeast," the prime minister said.

The Prime Minister said India now needs next-generation infrastructure - consisting of both highways and i-ways (information ways). He said there should be no digital divide, and the vision of Digital India also encompasses the Northeast. "Digital India's dream must definitely include the Northeast too. Once I-way connectivity is established, remote corners of the Northeast will also be at par with other parts of the country," he said.

Modi also described railways as a development tool and said railways not only connect people and places but also empower the community. The prime minister also described the eight states of Northeast as "asta-lakshmi" or "eight goddesses of wealth" and said the country will prosper in the truest sense only when the Northeast also prospers.

Radio Industry to grow by double digit by 2019

The history of radios dates back to the year 1923 when the Radio Club of Bombay started broadcasting programs in India. AIR (All India Radio) launched its first FM service from Madras to offer a wide range of audio programs to listeners with improved content and broadcast quality. ill 1999, India's FM radio market was governed by AIR.

However, with Phase-I auction policy in the same year, the market opened its realms for private FM radio companies. The policy met limited success with the launch of only 21 channels that were allotted under this policy. These channels are still operational across 12 cities in India. Later in 2005, the launch of Phase-II auction policy fuelled private FM radio channels in the country under which the government allocated licenses

12

Issue 2015-04-2


Media & Entertainment Industry

for 245 channels. However, with the upcoming Phase - III auctions the more new licenses are expected to be allocated which would further drive the market for FM Radio Stations in India.

According to "India FM Radio Industry Forecast & Opportunities, 2019", the industry is expected to witness double digit growth during 2014-19. Increasing number of FM radio listeners coupled with the growing expenditure on advertisement campaigns by real-estate, pharmaceutical, education, healthcare sectors, etc., are resulting in strong growth of the FM radio industry.

The upcoming phase-3 auction is also expected to spur the market for radio in the country as radio station operators would expand and enter further in Tier-2 and Tier-3 cities. The launch and implementation of this policy would provide the country with 839 radio channel licenses across 227 new cities in addition to existing cities. Driven by these factors, India FM radio industry is forecast to touch USD656.33 million by 2019.

Having a large base of FM radio listeners, Delhi NCR and Maharashtra are the leading markets for FM radio in the country. Leading companies operating in India's FM radio market include PrasarBharati, Entertainment Network (India) Limited, Sun TV Network Limited, Reliance Broadcast Network Limited, Music Broadcast Private Limited and D.B Corp Ltd.

Along with FM growth, with an aim to widen the reach of its schemes, the Tribal Ministry has sought inclusion of more tribal dialects in All India Radio broadcasts. A detailed plan is also being worked out to add value to the programmes in consultation with Ministry of Information and Broadcasting (I&B) and AIR, ministry officials said.

"We have suggested that there is a need to cover more tribal languages. The outreach of AIR in hilly areas is limited. FM Radio, which is one of the new initiatives of AIR, has a limited range even under best line-of-sight situation.

"In an uneven and forested terrain, the reach of the FM is even lower. Shortwave (SW) broadcasting is more efficient in such areas, but the availability of SW radio among tribal people has to be attended to," a senior official of the Tribal Affairs Ministry said. The objective is to expand the ministry's reach among the tribal through effective means of communication.

North-Eastern states developing with time

North-Eastern region is said to be underdeveloped in terms of infrastructure, employment, education, skill development and social aspects. But the latest Times Jobs data reflects an upsurge in hiring trends in Northeast India. An analysis of TimesJobs.com Recruite X data from Feb 2014-Feb 2015 shows that the North-eastern states are emerging as new job hotspots.

"Improving interstate infrastructure, telecommunications are providing a strong impetus to economic development and job growth in the Northeast. With a young, ambitious, well- educated population it is quite possible that the Northeast is going to be the new ITeS (IT enabled services) & BPO hub of India," TimesJobs.com COO VivekMadhukar said.These new findings refute the perception that the North- East does not offer good employment opportunities. Improving job market in the region are due to improved infrastructure, consumer sentiments and investments in IT and core manufacturing sectors such as automobile, consumer durables and FMCG, TimesJobs.com said.

In Sikkim, the demand for talent is up by 6 per cent in hospitality, IT-software and biotech and parma. However, demand is mostly for entry-level roles with salaries going up to just Rs 2 lakh per annum. IT industry can look for NE for any expansion plans. This clearly indicates that residents of the North-East are likely to earn more in their hometowns than in metros in similar job profiles.

13

Social Media PR Trends Bringing PR into the FutureIn today's world of constant news bombardment, happening 24/7 on our social media feeds - Twitter, Facebook, Instagram and so on - it has become the norm that social media plays major role in every sphere and this is true for public relations industry too. For PR pros this has meant the birth of those new social media trends that are driving engagement and which are becoming parts of our everyday lives in our practice, to reach out to the upcoming generation. So what main trends do we have to thank for this "new" mode in which PR functions? We'll call it Social Media PR. - Another way PR is using social media to attract and

maintain engagement with users is in the increase in popularity of niche interest networks and groups, and their participation on the various social media sites. As an example, many millennials have migrated away from Facebook and have become more active on platforms like Snapchat and Instagram.

- Video content is another trend from social media that we are seeing more and more in PR. Specifically, they are now 'must haves' for one's Facebook page, to be included in press releases for more traction and to add multi-media to your blog, whenever possible to attract new eyes.

Issue 2015-04-2

Disclaimer: This information has been collected through secondary research and ICSI is not responsible for any errors in the same. Copyright © 2015 ICSI—International Chamber for Service Industry.

[email protected] | www.icsiindia.in All other materials & logos copyrighted to their respective owners

Empowering Service IndustryInternational Chamber for Service Industry

New Delhi - India

service industryinvestment growth to 12 percent during fy 2016-fy 2018, the bank said in its...

Documents