Optimistic Investments

first_imgIndia has a growing population of educated young professionals, rich natural resources and close contact with the world leading nations. Optimism has grown in some circles since the new government under Prime Minister Narendra Modi came to power last May. Indeed, Finance Minister Arun Jaitley recently forecast that India’s economy will accelerate from 7.4% GDP in fiscal year 2014-2015 to 8%-8.5% in 2015-2016. Based on the government’s new method for calculating economic growth, officials boast that India is now the fastest-growing large economy in the world. According to Jaitley, India needs sustained GDP growth of 9%-10% to achieve its longer-term development goals.Ramnath Balasubramanian, a partner at McKinsey & Company, stressed the importance of demographic changes in the country. He pointed out that there are currently around 425 million Indians in the consumer sector of the country and 20% of the population is urbanized. It is estimated that by 2025, as much as 50% of all Indians will be urbanized. “While as many as 35 million people will be holding government jobs [by 2025] ,” said Balasubramanian.Positive StrokesJay Shah, chief executive of Hersha Hospitality Trust, which owns interests in 65 hotels in gateway markets such as Boston, Philadelphia and New York, said that foreign private equity firms such as KKR & Co. find India very attractive.KKR recently set up a non-banking financial company (NBFC) in India in partnership with GIC, Singapore’s sovereign wealth fund, for lending to the real estate sector. This is KKR’s second NBFC in India. KKR has been active in the country since 2006, with total equity investments exceeding $1.5 billion.According to Shah, the driver for such investments is the widespread perception that India has “more upside going forward” than in the past. “The new administration is expected to back new ideas,” said Shah, adding that the inflation rate has dropped to around 5%, down from an average of 8.87% from 2011 until 2015.The real estate sector has been further encouraged by the implementation of recent regulations for real estate investment trusts (REITs), which provide them with viable exit paths. India’s new government is laying the groundwork to make REITs tax-exempt and to allow them to trade on public exchanges. Assets that may qualify to be included in REITs may reach $20 billion by 2020, according to an estimate by property broker Cushman & Wakefield. In the first three to five years of the implementation process, as much as $12 billion could be raised. Already, noted Shah, about $10 billion in investments have been made. “This is a great start for priming the pump of the real estate sector,” Shah added.Munish Dayal, partner at Baring Private Equity Partners India, said that he hopes to see major changes in the way the Indian government functions under Prime Minister Modi. Pointing out that “the first step is to revitalize the bureaucracy,” Dayal said that he is encouraged by the fact that many Indian bureaucrats now work through the day and during weekends also. “This has been a big change. It’s a start to ending the policy paralysis that has been common in the past.”Observing that this is the first time that the Indian government is talking about an investment-led growth strategy, Dayal said: “A year ago, we were going downhill. Now, the plot has changed, and there is a lot more hope in the markets. Apart from the energy generated by the new prime minister, the fall in crude oil prices has given us a lever to invest in infrastructure.” Commenting on the government’s new ‘Make in India’ initiative, he said: “We can expect a lot of investors in defense and in railways.”Dayal also emphasized another aspect: the responsibility of the state governments. “We tend to forget about the role of state governments. But a fair amount must be done at the state level in such activities as education, roads and sanitation.”A major reform announced by Jaitley during this year’s Budget was the Goods and Services Tax (GST). A value added tax to be implemented beginning in April 2016, the GST is expected to replace all indirect taxes levied on goods and services by the Indian central and state governments.Akshay Mansukhani, partner at Malabar Investments, which invests in small and midsize businesses in India, said that “the basic assumption [that investors have regarding India’s economic prospects] is that the financial system is stable.” He noted that the rupee has been stable, and the decline in oil prices has helped moderate inflation and interest rates. Pointing out that the independence of the country’s central bank, the Reserve Bank of India, is of critical importance, Mansukhani added that the long-term goal of the Reserve Bank is to establish a freely moving currency. “The Bank’s goal should be managing the volatility of the rupee, not to set the exchange rate of the rupee at any particular value.”Problems PersistBut Shah also added a note of caution. India currently ranks 142nd out of 189 countries in the World Bank’s “Ease of Doing Business” listings, he said, which is “problematic” not just for developers in real estate, but in all sectors. For example, it could take up to 200 days to get all the approvals required for opening a commercial warehouse in India. When it comes to operating a hotel, typically around 70 to 110 permits are required, compared with only six in highly-ranked Singapore.India’s inadequate infrastructure also presents multiple hurdles, imposing costly delays. As much as 30% of all fresh produce spoils in transit because of inadequacies in the cold chain. The lack of modernization of intellectual property regulations is also a persistent problem for many foreign investors. “The slower [the government] is in tackling these issues, the further they will fall behind,” said Shah.Patrick Foulis, former India business editor of the British weekly The Economist, also pointed to some areas of concern. He noted that that despite optimism about India’s future, “the inputs of production” such as land and labor have not been reformed. “There are not enough good jobs being created [in India], and the reputational barrier of India is huge.”Foulis, who is currently The Economist’s New York bureau chief and U.S. business editor, went on to add that although many people express optimism about India’s prospects in public, they are often skeptical in their private discussions because of the country’s inadequate performance when it comes to creating jobs for poor people. “That worries me,” said Foulis.According to Dayal, India needs to urgently “rebuild investor confidence” and attract foreign capital. “The growth won’t happen if enough capital is not here…. The government has thrown a lot of balls up in the air. Now we will see which ones it can keep going.” Added Balasubramanian: “It is very clear that there are no short-term fixes.” Related Itemslast_img read more

The 5 Takeaways from the Coyotes introduction of

first_img The 5: Takeaways from the Coyotes’ introduction of Alex Meruelo TEMPE, Ariz. — As the Arizona Cardinals begin their second week of offseason workouts, two questions loom large over the offense.And they both deal with the offensive line.“We got to figure out who the center is going to be, we got to figure out who the right tackle is going to be,” quarterback Carson Palmer said.Let’s start with the latter.D.J. Humphries, who spent his entire rookie season on the inactive list after the Cardinals selected him in the first round with the 24th overall pick, is expected to fill the right tackle spot.  Last year’s starter Bobby Massie signed a free-agent contract with Chicago. 0 Comments   Share   Mathis will play right guard and join returning starters Jared Veldheer and Mike Iupati, who anchored the left side of the line at tackle and guard, respectively.Veldheer started every game last season, while Iupati started the final 13 following a knee injury and yet still was voted to his fourth consecutive Pro Bowl, becoming the first Cardinals lineman to be so honored since Lomas Brown in 1996.“It’s going to be a challenge,” Palmer said, referring to all five linemen getting on the same page. “Those guys have a lot of continuity that they need to get caught up with each other and figure each other out and get used to the way each other calls protections and the different things that happen up front. But it’s a great group going into camp.”The jelling of an offensive line takes time. It can’t be rushed, according to Mathis.“There’s so many different factors that go into that: how much work you put in together off the field, how much experience you get together on the field in the different types of situations you end up in because you’re not always going to be in the same situations in practice and in games. There’s a lot that goes into that,” he said. “Some guys pick it up really fast and sometimes it takes guys to get thrown into more challenges than others before they jell, but I’m looking forward to this unit doing it pretty fast.” Humphries earned praise from both head coach Bruce Arians and offensive coordinator Harold Goodwin at season’s end for the progress he made. In addition, the coaches expressed confidence in the 22-year-old being ready to handle the job.As far as who plays center, that’s more of an unknown.Currently, the Cardinals list only two centers on the roster: veteran A.Q. Shipley and Valerian Ume-Ezeoke, a four-year starter at New Mexico State who was signed to a future contract after he was released by Atlanta as an undrafted rookie free agent.The Cardinals will likely address the position at some point during this week’s three-day 2016 NFL Draft either with a player familiar snapping the football or one they believe may be able to transition to the middle of the line.“There’s going to be some battles. There’s a lot of competition up front,” Palmer said.The Cardinals are probably looking at three new starters along the offensive line this season.“I’m excited. You very rarely keep five for year after year after year,” said Palmer, who called the free-agent acquisition of two-time Pro Bowl guard Evan Mathis “huge; a guy that’s proven, a guy that’s played well.” Every moment together is important for the offensive line, even those here during the voluntary strength and conditioning program, where pads are missing as is a defense to line up against.Palmer, though, is convinced the group will get on the same page sooner rather than later.“You just work. There is no secret. It’s just work, and it’s repetitions. You can’t fake those repetitions. You have to get the reps in,” he said. “You can’t sit in the meeting room and watch film and do it. There’s things that have to happen on the field.  When the guy that’s coming off the edge or a blitz is coming up the A-gap and you have to change a call or you have to pat your butt or whatever the signals are for the running backs, those things you just have to rep and we’ll get those.” Derrick Hall satisfied with D-backs’ buying and selling Former Cardinals kicker Phil Dawson retires The Arizona Cardinals’ offensive line will have a different look in 2016. Jared Veldheer (68) will be back but Lyle Sendlein (63) may not be. (AP Photo/Bob Leverone) Top Stories Grace expects Greinke trade to have emotional impactlast_img read more