Author: Stephen Manallack

Former President, Australia India Business Council, Victoria and Author, You Can Communicate; Riding the Elephant; Soft Skills for a Flat World (published by Tata McGraw-Hill INDIA); Communicating Your Personal Brand. Director, EastWest Academy Pty Ltd and Trainer/Speaker/Mentor in Leadership, Communication and Cross Cultural Communication. Passionate campaigner for closer western relations with India. Stephen Manallack is a specialist on “Doing Business with India” and advisor/trainer on “Cross-Cultural Understanding”. He is a Director of EastWest Academy Pty Ltd which provides strategic advice and counsel regarding business relations with India. A regular speaker in India on leadership and global communication, his most recent speaking tour included a speech to students of the elite Indian university, Amity University, in Noida. He also spoke at a major Federation of Indian Chambers of Commerce and Industry (FICCI) global summit, the PR Consultants Association of India in Delhi, the Symbiosis University in Pune and Cross-Cultural Training for Sundaram Business Services in Chennai. He has visited India on business missions on 10 occasions and led three major trade missions there. He provides cross-cultural training – Asia and the west.

4 tips from India for business and entrepreneurs during the Covid-19 crisis

Pranshu Sikka, CEO, Strategic Planner and Founder of The Pivotals (which styles itself as India’s first “Business Worries Outsourcing” firm) mentions how important it is to do four right things keeping everyone in mind.

Empathize & Strategize- It is important to keep our relationship with existing clients alive. Empathize- they are as badly hit as we are. Consider creating a pipeline of business through digital outreach. Look at the older leads that were on the backburner due to one reason or another.
Offers: Check, if there is merit in diversifying your offering to keep yourself relevant in a post corona world. Think about your stakeholders, yourself, consumer and employees.
No Knee-Jerk Reactions– Businesses are getting affected but don’t get lured into completely diversifying to a new, unrelated stream of business. It is only a matter of time until the situation settles and allows business houses to take more informed calls. Knee-jerk reactions won’t do any business any good.
Morality & Law- As a business don’t cut corners. Don’t do the mistake of doing something not in consonance with morality or law. It is imperative to be on the right side of the law as well as ethics- something which will hold the key to tiding over these difficult times and creating a sustainable value propositions.

India’s pharmaceutical industry shows how we are all connected today

India plans to set up a US$ 1.3 billion fund to boost the manufacture of pharmaceutical ingredients domestically.

How so, since India is already a big pharma player? For example, India supplies about 20% of the world’s generic drugs and is the world’s largest exporter.

Well, in pharma as in everything else in life, all things are connected.

You see, India’s supply chain was disrupted due to the coronavirus pandemic – exposing the country’s dependence on China.

Here’s where “we are all connected” comes in – India is indeed a global leader in pharma but it imports almost 70 per cent of its active pharmaceutical ingredients, the chemicals that make a finished drug work, from China.

Which part of China provides the ingredients? Hubei province, the epicenter of the coronavirus outbreak has been major source of these ingredients.

The new program consists of spending on infrastructure for drug manufacturing centers and financial incentives of up to 20 per cent of incremental sales value over the next eight years, according to a government statement.

Gandhi lay drastically ill with the Spanish Flu almost 100 years ago

As India fights to contain the Corona Virus (pictured are temperature checks on visitors to the Bombay Stock Exchange) it has been announced that the historic Sabarmati Ashram (a former home of Mahatma Gandhi) will remain closed for visitors from March 19 till March 29 in view of the coronavirus threat, the trust managing the complex said on Wednesday. The ashram receives a large number of visitors everyday.

The closure comes almost 100 years after the great Mahatma Gandhi lay ill in this ashram – with the Spanish Flu (1918).

Sabarmati Ashram is located in the Sabarmati suburb of Ahmedabad, Gujarat, adjoining the Ashram Road, on the banks of the River Sabarmati.

I was there one year ago – a quiet, beautiful and emotional experience coming closer to the great Mahatma.

“All interest in living has ceased”, Mahatma Gandhi, battling a vile flu in 1918, told a confidante.

The highly infectious Spanish flu had swept through the ashram in Gujarat where 48-year-old Gandhi was living, four years after he had returned from South Africa. He rested, stuck to a liquid diet during “this protracted and first long illness” of his life. When news of his illness spread, a local newspaper wrote: “Gandhi’s life does not belong to him – it belongs to India”.

Fortunately for India and the world, Gandhi recovered. However, tragically the Spanish Flu killed between 17 and 18 million Indians.

Our thoughts are with India as it now battles to limit the Corona Virus – so far, all indications are that measures are succeeding.

India’s airlines are really hurting during this Coronavirus pandemic

SpiceJet’s chairman Ajay Singh is spending a lot of time in Delhi in front of civil aviation secretary Pradeep Singh Kharola.

The coronavirus has rattled India’s airlines, a big change from their New Year optimism. Many of them do not have deep pockets so are vulnerable.

In January, the industry was happy with fare discipline, controlled capacity addition, the absence of rival Jet Airways, and a slow but gradual demand recovery.

On Wednesday, IndiGo told the stock market that its earnings would be materially impacted because of the disruption, and domestic bookings had fallen 15%-20%.

The airlines’ anxiety comes from their weak balance sheets.

Those in the know say Singh is lobbying with the government to bring jet fuel under GST – such a reform could bring a windfall in reduced taxation of jet fuel.

Perhaps also on the cards is flexibility in payments to oil companies.

IndiGo has a fleet of 255 planes and money in the bank. The Tata Group backs Vistara and AirAsia India, while the Wadia Group owns Britannia and Bombay Dyeing, runs GoAir.

Government help or not, Indian airline execs are preparing for the worst – and some without money in the bank or big owners. Changes ahead?

India – how Australia’s trade will change and how we should communicate

In the 1990’s, Australia sold India coal and LNG. We also sent over copper, lead and gold, along with unprocessed foods such as chickpeas, lentils, almonds and oils.

According to India veteran Michael Moignard (pictured) of East West Advisers, it was the beginning of our trade relationship with India – so that makes it very recent.

In the 2000’s our trade has shifted – uranium is in there but taking the prize has been education in the form of fee-paying students in Australia. Along with this has been IT and processed foods, with wine and packaged goods finding a market. Finally, Indians discovered Australia as a tourist destination.

So, what will the 2020’s look like?

Michael Moignard was our Senior Trade Commissioner in Delhi for 7 years, so it was good that he gazed into the crystal ball at a recent India seminar at BDO. This is what he saw:

“Sustainability” will become a big theme, covering services and products around water, waste, renewables and smart cities. That’s a big shift.

Education will continue to dominate but with a move to skilling India’s workforce – in India. And IT will blossom into IoT, Ai and more.

Continuing strong will be wine, packaged goods and tourism.

In short – it’s a good picture for Australia. Hope you are ready to participate!

Mike’s advice on how to approach India:

Don’t just think about selling your product and services to India (just sales and profits should not be the only motive)
Work together to create relationships, trust and mutual value (Indians value trust and personal relationships)
Ensure Indian counterparts understand you are there for the long haul…and not just for short-term profits
Don’t give the impression that your India strategy is just a diversification from China (and India is definitely not the next China)

Oh, and his final tip, use the phone much more and the emails much less.

These India numbers will boggle your mind but the future is more exciting

Here are some India and Australia numbers to contemplate:

(Thanks to Bill Cole, Partner International, BDO, pictured below, for some of this data)

AUSTRALIA

Population: 24.6 million
GDP: USD 1.3 trillion
Top 5 Imports: Personal travel services, motor vehicles, refined petroleum and ships
Top 5 Exports: Iron ore, Coal, Education travel services, natural gas and personal travel services

INDIA

Population: 1.339 billion
GDP: USD 2.5 trillion
Top 5 Imports: Petroleum products, gems, electronics, chemicals and machinery
Top 5 Exports: Textiles, Gems, Chemicals, Products and Agricultural products

Top Trading Partners

Australia’s top 3 trading partners are China, Japan and the USA.

India comes in at number 7.

India’s top trading partners are China, USA and UAE, with Australia coming in at number 20.

So, what about the future?

Australia’s India Economic Strategy to 2035 Report:

Recommends that by 2035 Australia lift India into our top three export markets, make India the third largest destination in Asia for Australian outward investment and bring India into the inner circle of Australia’s strategic partnerships
Identifies 10 sectors where strengths of Australian businesses match India’s needs:
- Education (flagship)
- Agribusiness, resources and tourism (lead)
- Energy, health, infrastructure, financial services, sport, science and innovation (promising)

It is sure a “big picture” report – but with the right approach it can be achieved.

Seems PM Modi and PM Morrison are getting on well – so time for business, investment and education to pick up the baton and run with India. Ready?

Where to from here for the Coronavirus and India investments?

Where to from here for India?

India Avenue Investment Management – an Australian fund for India – has issued advice regarding the impact of the Coronavirus on investing in India. Here are some highlights:

As we have always articulated to investors, India is a market where you should build exposure during dire times as the structural story will outlast any cyclical events.

It’s a matter of portfolio construction and investment horizon. When it comes to satellite investments like investing in India, investors typically tend to sell during adversity and buy during euphoria.

As a business we seek to improve this experience for our investors by providing our insights of activity on the ground in India.

Globally markets around the world peaked on February 20th, 2020 and since then have fallen roughly 20% in local currency terms (S&P500). Currencies have also been moving around in a volatile fashion.

In India, markets have fallen approximately the same amount.

However, a corporate tax cut, bank recoveries, improving GST collections and a pick-up in PMI’s indicated most positive news was on the way in FY21 (India’s financial year is April-March).

The Coronavirus won’t stop India’s structural growth resuming its path at some point in FY21, however, it will impact global growth in at least the first half of 2020 and therefore India’s growth.

Whilst India doesn’t have significant links to the global supply chain (exports are only 11% of GDP), it benefits when global growth is strong given comparative advantages in exports of refined petrochemicals/oils, gems/precious stones, textiles, electronics, pharmaceuticals and automobiles.

However, the key risk for India is the virus making itself a home amongst India’s significant population of 1.3bn and the potential for it to spread quickly, without appropriate healthcare systems and medication for all.

We cannot estimate what the damage will be to markets, but we see the following positives: • Central Bank potential to cut cash rates significantly from the current 5.15% • US$475bn of forex reserves to defend the currency if required • A substantial fall in the oil price which will reduce inflationary pressures in India (India imports over 80% of its oil usage) • Fiscal stimulus likely to be forth coming • Potential to replace China in certain aspects of the global supply chain, given most are now seeking diversity of supply.

For those who have invested in our Fund, the next week or two (which we expect will see heightened panic amongst investors), will be a good time to add some further funds as India is well positioned to rebound as it often does from adversity.

However, how much bravery you have will determine when you invest!

It is not very often that you can identify an investment where you can buy quality growth stocks at P/E’s in the teens and cyclical growth for single digit P/E’s in a market like India. We are re-aligning our Fund to go overweight in the both these segments.

Thanks to India Avenue Investment Management for the above insights

Melbourne and Victoria leading the way on India growth story

My home town is leading big time on engagement with India.

Michelle Wade, Commissioner to South Asia, State Government of Victoria, Australia, outlined some of the facts in a recent speech to a BDO event “India – it’s time to diversify”.

Melbourne and Victoria are dominant in Indian student numbers, we have close on 180,000 Victorians who were born in India plus on tourism we lead the way.

According to Michelle Wade, trade and investment opportunities abound for us in India – including advanced technologies, edtech, health and wellness.

One key to doing well is to drill down and find organisations with the right capabilities, according to Wade.

BTW Victoria has business offices in Mumbai and Bengaluru – and have been very helpful to me.

Which Victorians are doing well in India? A few from the big list – Linfox, Deakin University, Rubicon Water, MedSurge, Monash University and Swisse.

Time you engaged with the India growth story?

Canada boosts student numbers and gains in diversification of source countries

Canada welcomed more than 400,000 new international students at all study levels in 2019, with Indian student enrolments accounting for most of the increase in new study permits issued.

More important than the increase – Canada is succeeding in diversification of source countries. This has become a “top priority” for Canada.

These students were for university, colleges and K-12 schools.

Immigration, Refugees and Citizenship Canada statistics show that 404,165 individuals were issued study permits in 2019, an increase of almost 50,000 on the previous year. In 2018, 355,100 new study permits were issued.

Although total figures for the 2019 student population are yet to be released, this new data indicates that the entire international student population in Canada now exceeds 600,000, according to one analyst.

The statistics reveal that 139,740 Indian students were issued study permits in 2019 – up from 107,175 in 2018 – and Indian citizens represent 35% of all 2019 new study permits.

The second biggest cohort came from China with 84,710 permits, marking a decrease on 2018 figures where 85,165 Chinese students were given study permits.

Iran (+39% to 9,795), Nigeria (+16% to 7,585), France (+9% to 14,670) all showed increases of study permits becoming effective in 2019, compared with 2018.

Other countries represented in the top 10 such as South Korea, Brazil, the US and Japan have remained stable, while Vietnam decreased slightly on 2018 figures.

Rounding off the top 15, the Philippines, Mexico, Bangladesh, Colombia and Taiwan all saw increases, with new study permits for the Philippines notably increasing by 56% to a total of 6,365 in 2019.

In 2018, just 40% of active study permits in Canada were for university study – the rest for students at colleges, Quebec’s CEGEPs or at K-12 schools, Universities Canada highlighted.

Although the 2019 breakdown is not yet available, the organisation expects a similar division.

“With the caveat that these new numbers reflect the system as a whole, rather than just university enrolments, Canadian universities are pleased to see continued growth in the number of students choosing Canada as their study destination,” explained assistant director of International Relations at Universities Canada, Cindy McIntyre.

Source: The PIE News

“Namaste Trump” good diplomacy for India but differences with USA remain

Can India make the most out of US President Donald Trump’s visit?

“Namaste Trump” this week been a great visit for India and looks to have been celebrated across the nation. Two leaders of great democracies.

But differences still exist, and the question is can India and PM Modi build on President Trump’s historic visit which took place this week?

PM Modi will drive the relationship, but he is not alone.

One man in South Block — Harsh Vardhan Shringla, India’s foreign secretary – will make a big contribution to the outcome.

India’s foreign secretary is seen as a calm and composed officer, and he has handled bilateral ties even during turbulent times as the Indian ambassador to the US.

It was he who dreamed up and led the “Howdy, Modi!” event in Houston.

Now he has a lot of the responsibility of making “Namaste Trump” a success.

What will be the big issues? Top of the list is a free-trade agreement and disagreements on intellectual property rights. Plus how both countries feel about and react to China.

But clearly Namaste Trump is a big win for India and PM Modi and a mark of the increasing respect India has on the global stage.

Indian PM Modi and US President Trump – two men who enjoy centre stage and get on well