Wednesday, March 23, 2011

Mr. Suraj Prasad Agarwal Elected to FICCI

Mr. Suraj Prasad Agarwal, Past-President of The Federation of Andhra Pradesh Chambers of Commerce and Industry (FAPCCI) is elected as Member on the National Executive Committee of the Federation of Indian Chambers of Commerce and Industry (FICCI), New Delhi, for the Third time.

Mr. Suraj Prasad Agarwal is the Chairman of the Quli Qutab Shah Industrial Training Institute (QQSITI), Santhosh Nagar for Girls, and Member of Zonal Railway Users Consultative Committee (ZRUCC) of South Central Rwailway. He is on various other Social Organisations’ Executive Committees, i.e Agarwal Siksha Samathi, Sri Krishna Goseva Mandal Narsingi. He is also associated with Swami Narayan Gurukul Residential English Medium Boarding School, Red Cross Society of India. Recently, he is nominated on the Regional Committee, Employees Provident Fund, and is nominated on International Chamber of Commerce and Industry, New Delhi.

Holi "Thandai" Celebrations @ FAPCCI

The Federation of Andhra Pradesh Chambers of Commerce and Industry (FAPCCI) organized a “Holi Celebrations” with Thandai (Dry Fruits & Special Saffron Flowered Milk) in a traditional way on 19th March 2011 from 5 pm to 6 pm, at at Banarasi Hall, Federation House, FAPCCI, Red Hills, Lakdi-Ka-Pul, Hyderabad.

Mr. Shekhar Agarwal, President, FAPCCI, Mr. M.V. Rajeshwara Rao, Secretary General, FAPPCI and Mr. Suraj Prasad Agarwal, Past President and several industrialists and businessmen like Mr. Laxmi Niwas Sharma, Mr. manoj Kumar Agarwal, Mr. Hari Haran, Mr. Hari Govind Prasad, Mr. S. Tirumali, Mr. Omprakash Tibrewala and Managing Committee members and staff are participated at the celebrations.

FAPCCI Holi Greetings to Governor & Family

FAPCCI team inclusive of Mr. Shekhar Agarwal, President, FAPCCI, Mr. Suraj Prasad Agarwal, Past President, Mr. O.P. Tibrewala, Mr. Nitin. K. Parekh, Mr. Suraj Prasad Agarwal, Mr. S.S. Pasari, Mr. R.K. Agarwal, met His Excellency Mr. Narasimhan, Governor of Andhra Pradesh and family at Raj Bhavan to extend Holi Greetings to the Governor family.

Meeting on “Hyderabad Traffic Management Plan”

Maize & Maize Based Industries - Opportunities in AP

Mr. V. Nagi Reddy, IAS, Principle Secretary to the Government, Agriculture and Cooperation, Government of Andhra Pradesh released the Report on “ Maize and Maize Based Industries – Opportunities in Andhra Pradesh” on 16th March, 2011 of the Federation of Andhra Pradesh Chambers of Commerce and Industry. Dr. B. Venkateswarlu Director, Central Research Institute of Dryland Agriculture was the Guest of Honour at the programme.

He stated that the State Government would provide all the facilities and support to the entrepreneurs who come forward to set up the industrial units in the Maize and Maize based products, he said that the cultivation of Maize has grown enormously in rabi season also as earlier it was cultivated only in the Khariff Season. Speaking about the maize production in the State, Mr. Nagi Reddy said that, about 2 lakhs tons in Rabi and 7 lakh tons in Khariff are cultivated in 6 lakh hectares. He stressed that there is good demand in domestic as well as international market for the maize and maize based products in addition to its traditional use by poultry and dairy sector as feed. As there is good potential for the maize based food products and industrial products, he requested the entrepreneurs also look into the aspect of starting small and medium enterprises in the rural area of the State which would help in creating more employment opportunities.

Dr. B. Venkateswarlu, Director, Central Research Institute for Dryland Agriculture, speaking at the occasion stated that their Institutes are taking up extensive research programmes of agriculture under the supervision of 40 scientists. He said that farmers and entrepreneurs could also be benefitted from the technical assistance in identifying the suitable maize.

Mr. Chengal Reddy, president, The Federation of Farmers Association, in his address stated that FAPCCI should set up a full-fledged information cell to provide guidance to the entrepreneurs who wish to set up units in the maize and maize based products, so that the information given in the Report would be utilized and also organize awareness programmes about the maize usages. He stated that the scientists, industrialists and Government should work in close cooperation to bring the development in the maize production.

Earlier, in his welcome Address, Mr. Shekhar Agarwal, President, FAPCCI stated that to Government to have a special Department for the production of maize and promotion of maize based industries in the State by involving the representatives of farmers, scientists, entrepreneurs, government officials. The Department works towards the quality maize production, promotion of industries in food processing and other maize based industries promotion, so that to develop Andhra Pradesh as Maize State of the Country.

Mr. K. Bhaskar Reddy, Chairman, agriculture and Agro based industries Committee, of FAPCCI and Mr. Saibaba, of Jain Irrigation spoke at the occasion.

Wednesday, March 16, 2011

Press Release on Increase in Property tax on Commercial Properties & Increase in Cement Prices

FAPCCI/2010-11/March/007-A March 15, 2011

Sub : Increase in Property tax on Commercial Properties & Increase in Cement Prices duet o rise in the Excise duty in the budget in addition to increase in prices of coal, diesel and proposed increase in power tariff in the state of A.P.

The Fifth Meeting of the Urban Infrastructure & Telecom Committee of FAPCCI met at FAPCCI on 15th March,2011 and discussed the following issues . Mr. Shekhar Agarwal , President, FAPCCI; Mr. Gowra Srinivas , Chairman , Co –chairman , Advisor of the committee and builders were present in the meeting.

The following issues were discussed and resolved related to Real Estate and Infrastructure businesses:

Cement manufacturers increased Cement prices abnormally as a result of Central Government increase of the Excise duty by 10% ; due to this the Real Estate and Infrastructure businesses were affected very badly. Already in Hyderabad, the business is badly affected due to political insatiability and disturbances. The additional price increase will be a serious blow to the Real Estate and Infrastructure businesses in future.

Apart from the cement price increase , the Govt of A.P issued G.O Ms. No 88 amending the Rules 9, 10 and 11 removing the cap on property tax imposed earlier for residential and non- residential buildings ie a maximum limit of 75 % and 100 % -150% of the existing tax as on 31-3-2002 respectively, there by opening the flood gates for possibility of increase of property taxes with no limits which will be a death blow to the Real Estate and Infrastructure businesses which is already operating with thin margins.

Hence it has been resolved and FAPCCI propose to discuss these issues widely with the Cement dealers and manufacturers and represent to the Central and State Governments to take appropriate actions to save the industry.

Tuesday, March 15, 2011

World Consumer Rights Day Celebrations

The Department of Consumer Affairs, Food, Civil Supplies, A.P, Hyderabad in association with The Federation of Andhra Pradesh Chambers of Commerce and Industry (FAPCCI) jointly organized a “World Consumer Day Celebrations” and Valedictory Address on “Fair Financial Services on 15th March 2011 from 10 am to 5 pm, at K.L.N. Prasad Auditorium, Federation House, FAPCCI, Red Hills, Lakdi-Ka-Pul, Hyderabad.

Mr. S.V. Rama Rao, IPS, Additional DGP – CID is the chief guest for this occasion. Mr.Sanjay Jaju,IAS, Commissioner, Civil Supplies, Mr. S H Huda, IPS, Addl DGP & Controller of Legal Metrology, Mr. M. Dinakar Babu. IAS, VC & MD, AP Civil Supplies Corporation Ltd, Mr. K.R.B.H.N. Chakravarthi, IAS., Director, Consumer Relations, Govt. of Andhra Pradesh, Mr. Shekhar Agarwal, President, FAPCCI, Mr. V.V. Sanyasi Rao, Chairman,Consumer relations Committee, FAPCCI, Mrs. Rajam Ganeshan, Mr. Narsimhulu was participated at the occasion.

Mr. S.V. Ramana Murthy, IPS., Additional Director General of Police, CID, inaugurated the Celebrations. Mr. Shekhar Agarwal, President, FAPCCI has welcomed the gathering. Mr. V.V.Sanyasi Rao, Chairman, Consumer Relations Committee, FAPCCI explained the purpose of the Celebrations.

While addressing, Mr. S.V. Ramana Murthy, Chief Guest, explained the precautions to be taken in dealing with people in financial matters and also explained the role of CID in identifying the cheats and culprits in financial market and looting the hard earned money. He also explained how the Police have implemented the modern technology in identifying the people who are going for financial crimes and other crimes.

Mr. Sanjay Jaju, IAS., Commissioner of Civil Supplies and Chief Guest of the Evening addressed on World Consumer Rights Day relating to how the Government of AP is taking the responsibility of protecting consumers from the fraud financial companies, chit funds and banks.

In the first technical session Mr. Gowri Shankar, President, Consumer Federation of AP, Mr. Ganesan, Journalist, Consumer Activist, Mr. Shekhar, CGM, HDFC Bank, Mr. Karunaka Reddy M, CEO, Smaat Aqua Technologies Pvt. Ltd., etc., addressed on “How customers can invest in fair financial services an get benefit out of it without getting attracted to the false NBFCs Chit Fund companies etc”.

Mr. Shekhar, Chief General Manager of HDFC Bank explained various products offered by the Banks for the safe investments of the individuals.

Mr. M.Sebastian, RBI Ombudsman has given keynote address on “Fair Financial Services and How the Ombudsman are safeguarding the interests of the consumers related to banks and financial companies”. He said the people should not be greedy and invest for high returns.

The Organizers’ organized various competitions on Consumer Relations to the students of various schools in the city.

“Viniyoga Tarangini” & Souvenir on “World Consumers Awareness day Celebrations” were released by Mr. Sanjay Jaju, IAS and Mr. S A Huda, IPS.

Smt. Durga Rani, Co-Chairperson, Consumer Relations Committee, FAPCCI proposed vote of thanks.


Sustainability Report Under GRI – G3 Guidelines

The Federation of Andhra Pradesh Chambers of Commerce and Industry (FAPCCI) organized Awareness Program on “Sustainability Report Under GRI – G3 Guidelines” on 14th March 2011, from 10 am to 2 pm, at J.S. Krishna Murthy hall, Federation House, FAPCCI, Red Hills, Lakdi-Ka-Pul, Hyderabad.

Mr. B. Suresh Babu, IAS, Additional Commissioner, Department of Industries, Government of Andhra Pradesh was the chief guest for this occasion.

Mr. Shekhar Agarwal, President, FAPCCI, Mr. M. Srirama Murthy, Chairman, Industrial development Committee, FAPCCI, Mr. N.M. Prusty, CMD, Centre for Development and Disaster Management Support Services-A Strategy Centre, Mr. Karunakara Reddy M, CMD, Smaat Aqua Technologies Private Limited, Mr. Amalendu Pal, Chief Executive, Partners – in - Change, Mr. M.V. Rajeshwara Rao, Secretary General are participated in the awareness program.

Mr. Shekhar Agarwal, President while welcoming the dignitaries stated that Global Reporting Initiative produces most prevalent standards for sustainability reporting, environmental social governance reporting, corporate social responsibility reporting, Sustainability reporting is a form of value reporting where an organization publicity communicates their economic, environmental and social performance. GRI guidelines are regarded to be widely used. Its apply to corporate business, public agencies, smaller enterprises, non governmental organizations, industrial groups and others. G3 guidelines provide universal guidance for reporting on sustainability performance. These guidelines are applicable to small companies, large multination, public sector and other types of organizations from all round the world. The G3 guidelines consist of principles and disclosure items which help reporters define the report content, the quality of the report and give guidance on how to set the report boundary. Disclosure items include on management of issues. Another thing Partners in Change has been pioneering the understanding and practice of Corporate Responsibility issues in India. It strives to place, as its central focus, the poor, vulnerable communities and groups impacted by business. PiC offers a wide range of CR related services to business and civil society organizations operating in India, and works in close association with international networks and alliances in the South Asia region.

Mr. M. Sreerama Murthy, stated in his introductory remarks that Partner in Change was established in 1995 which was a separate organization under the Societies Registration Act 1860. It was supported by Action Aid International-India which was established a “Corporate Partnership” in 1993. It was non-profit and non governmental organization. It works with Management Institutions and Student Bodies for promotion and integration of Corporate Responsibilities education and research for the development of business leaders in future. The GRI – G3 guidelines are to attention on focused structural approach, motivating sustainable improvement and data management, becoming market leader, influencing policy makers, investor confidence, assist in stakeholders dialogue, builds ownership and commitment and helps in thinking. Finally he said that, however it is a new subject to us we definitely support this type of programmes and organize in FAPCCI.

Mr. Amalendu Pal, has given presentation on Concepts for SMEs development. The Enterprises are able to develop a self supporting dynamics and to accumulate capital and depends on self initiative. A sociao-cultural environment is adverse to innovation and entrepreneurship. Positive external effects improvement of training and qualification, improvement of the employment situation of disadvantaged groups, development of human capital and entrepreneurial potentials decentralization of economic structures, contributions to rural development, ecological aspects, provision of poorer social strata with affordable goods. Economic efficiency and growth, intensity of competition, establishment of a market and enterprise-friendly atmosphere, distributional fairness and equality of opportunities, and increased employment, On the micro level, it is deemed necessary to distinguish between the level of the individual project and the target group level Employment opportunities have to create to the entrepreneurs. Before implementing any promotional measures, donor organizations must have a clear understanding of the objectives. The priorities for promotion in SME sector technology up gradation such as products development, adaptation of process technologies to small scale production conditions and ecologically safe technologies. Linking of the small enterprise sector to the formal capital market is essential. Before starting the enterprise first selection of suitable entrepreneurial personalities, appropriate locations, infrastructure and internal capital formation. Have relations to the Governmental organizations

Mr. B. Suresh Babu, Chief Guest to the Programme has said that GRI - Reporting Framework provides guidance son how organizations can disclose their sustainability performance. The G3 are the so-called “Third Generation” of the GRI`s Sustainability Reporting Guidelines. They were launched in October 2006 at large international conference which attracted thousands. There is a “third generation” because the GRI seeks to continually improve the guidelines. The guidelines Framework is applicable to organizations of any size constituency or location and has been used already by many hundreds of organizations around the world as the basis of their sustainability reporting.

In this regard Sri Amalendu Pal has given very good presentation on the programme. The Commissioner of Industries will give support to organize such type of programmes. He also said thanks to FAPCCI to organize the programme and introduce this programme to the industrial sector and to implement.

Andhra Pradesh: Economic Vision - Budget 2011-12

The Seminar on "Andhra Pradesh: Economic Vision - Budget 2011-12" organized today by FAPCCI, at at Surana Udyog Auditorium, Federation House, Hyderabad.

The Seminar was organized in Two sessions with Government higher officials and Political party Representatives separately.

Session 1:

Mr. G. Sudhir, IAS, Sp. Chief Secretary to Govt., Finance, Mr. L.V Subrahmanyam, IAS, Principal Secretary, Finance & Planning, Mr. S.P. Tucker, IAS, Principal Secretary to, Planning, Mr. V.K. Srinivasan IAS (Retd.), Vice Chairman, Indian Institute of Economics, Dr. M. Gopala Krishna, IAS (Retd.), Prof. R.K. Mishra, Director, Institute of Public Enterprises, Mr. Potturi Venkateshwar Rao, Senior Journalist, Mr. Shekhar Agarwal, President, FAPCCI, Mr. Devendra Surana, Vice President, FAPCCI and Mr. M.V. Rajeshwara Rao, Secretary General are participated in 1st session.

Session 2:

Mr. Bandaru Dattatreya, Former Union Minister, BJP, Dr. K. Narayana, State Secretary, CPI, Mr. B.V. Raghavulu, State Secretary, CPI (M), Mr. Y. Sujana Chowdhary, Parliament Member, TDP, Mr. Kamalakara Rao, Ex-MLC, APCC, Mr. K. Srinivasa Rao, Lok Satta Party, Mr. Shekhar Agarwal, President, FAPCCI, Mr. Devendra Surana, Vice President, FAPCCI and Mr. M.V. Rajeshwara Rao, Secretary General are participated in 2nd session.

Inaugral Session:

Chaired by Mr. Rajeswararao.

Welcome address:

Delivered by Mr. Shekhar Agarwal, President, FAPCCI.

High rate of industrial growth is commended by Mr. Agarwal and hike in the allocation of the resources for Power and Infrastructure is also commended. President Agarwal stated that AP has the best Infrastructure Enterprenuers in India with international reputation. 10-15% rateof industrial growth is possible and six new industrial estates with the “State of the Art” infrastructure is a boon for the state. Department of Industries should be headed by the person with the rank of the Chief Secretary as recommended by FAPCCI. 15,000 crores of annual investment and five lakh new job creation is possible only through proper reorganization of the Department of Industries. Competency should be the main focus of the budgetary programs rather than dependency. Dependancy on uncertain and low quality Power is a major concern.

Dr. Sangeetha Reddy, Chair person of FICCI:

FAPCCI’s initiative to focus on the State Budget is novel and the initiative is worth continuing. High rate of education, Enterprenuerial spirit and fairly good infrastructure has translated into higher rate of industrial growth in the past 20 years.

However since the past two years, AP is lagging. AP lost the opportunity to become the Auto hub. AP’s good agricultural base has got a lot to do with future and present thrust on the agro products. FICCI preferred to focus more on agriculture in Andhra Pradesh.

How much of the 31,000 crores of union budget allocation for the skill development or the Skill Development Mission can be tapped by AP. IT, hospitality, tourism, agriculture etc must be the focus. Medical tourism is the major focus because, the population to bed ratio in AP is among the highest in India. Health care is part of the infrastructure now to enhance the medical tourism. Smaller hospitals with less than 30 beds are likely to benefit the most. State boundaries contours and its changes should not affect the positive high rate of industrial growth in AP.

Professor RK Mishra, Director, IPE.

The Budget is commended by Prof. Mishra. Benchmarking and value addition should have been focused better. A comparative analysis across the regions and countries and across the time must be made. There are many countries comparable to AP’s size and even smaller. Tamil Nadu’s state Government much more Pro-Active than even the Central Government. Human Development and physical infrastructural development are all superior in Tamil Nadu. Tamil Nadu has done greater service to the Power sector.

Over a third of India’s wind power capacity is supplied by Tamil Nadu.

AP’s fame has confined to the Ongole Bull. Revenue to Capital ratio is still very low in AP. China’s Revenue / Capital ratio is very high. Huge tax eriers in India and also in AP. Uncollected taxes must be the prime focus followed by the focus on the Black money.

AP’s productivity is only 40% of that of Tamil nadu. Climate, culture, food basket and culture are the best in AP. Yet, relative and absolute productivity are declining in AP.

Constructive criticism is lacking in AP and bribes are highly tolerated. The focus on the outcome is not yet there. Bigger vision should be there. Even Chattisgarh is thinking big. Activity based budget should be the focus. How can most of the people be kept dissatisfied. Capacity building has not received attention. udget must be outcome based and not incremental or financial based. Forward and backward linkages must be captured by the budget. Unbalanced growth must be focused and priority areas must be taken up.

Potential areas of corruption must be identified and plugged. Most of the recommendations by the committees are overlooked. Non tax revenue should be increased tremendously. PSUs are the important vehicles to increase the Non Tax revenue. How is it that the state PSUs are not made profitable unlike the central PSUs?

AP has the Factor Endowment advantages. Services export is the major strength of AP. More Manipal like Universities should be established in AP.

Telugu people played very important role in South Africa’s all round development and progress. Why can’t this happen in India and in AP itself? BioTechnology, Medical sector, IT, Education and R&D should be the major focus in AP. Country can only progress if core R&D is focused upon.

Resources should be allocated for growth, achieving excellence, future progress and for the Social Sector. Budget should target Productive efficiency. People live by Tomorrow and not by Today. Hence, planning and allocation should be proper.

Mr. S.P. Takkar, Secretary, planning:

AP grew by 200% in the past ten years and 100% in the past 4.5 years. Per-Capita income Rs. 60,000 or US$1,300. Mckinzey identified 17 growth Engines in AP. 8-9 focussed now.Tamil nadu had the infrastructure 50 years ago and AP developing only after the independence. MDGs will be achieved by 2015. 80% value addition is possible in agriculture. 40% of Horticulture products are damaged at the production level. Micro Irrigation is being focused now. Anantapur district comparable to Israel. A very silent revolution is happening most of which is through the private sector. Lot of unspent money is lying : especially the allocation for cold storage. Soon, the revolution is taking place.

Live Stock development is ambitious and milk production to increase from 105 to 250 million Metric tons. Teem building and Skill development is a serious lacuna. Hence, seven to eight million jobs can be created if we overcome these problems. Ground water is getting recharged contributing to the silent revolution. Bharat Nirman Program is contributing t a 50% growth in the Infrastructural development in AP.

“Bottom of the Pyramid” growth is emphasized by Mr. Takkar. Mr. Takkar recommends each woman to buy four saries every year contributing to the growth in the State Domestic Product, Service tax etc. Cash transfer is possible in few sectors now.

Chief Guest Mr. Sudhir:

Increased revenue generation can contribute to the rendering of greater justice through the budget to various sectors including the Social Sector. State Government’s responsibilities are clearly delineated in certain areas and overlap with the Center in certain other areas that are in the Concurrent list. The sources of Revenue are very limited in AP. Natural disasters and political upheavals have contributed to the difficulties in revenue realization and the meeting of the budgetary targets.

Fiscal deficit of 17,500 crores is well within 3% of the State Domestic Product in AP. There is a Power Vs. Irrigation expansion challenge in AP. Resources do not permit complimentary development of both the sectors.Industrial Investment Proposal clearance is the area of high priority. PPP projects are highest in AP and the Hyderabad Metro Rail project is one of the biggest PPP projects in India. Revenue generation in state PSUs is very difficult because of the popular protests. This causes a dent in the expansion of the production and services. APS RTC and State Dairy Development Corporation are the examples.

Mr. Sudhir requests the Chambers of Commerce and other Associations to help identify the priority areas in conjunction with the Research institutions and Universities.

Dr. Gopala Krishna, IAS:

Focus should be on the Economic Vision and the role of the Budget. Tax measures need to be introduced after consultations with the tax payers. An ideal recognition of the “Taxation with Representation” principle. Priority areas and areas with faster returns should be focused upon. Stability of taxation measures, the trends and the thrust of the budget should continue for years. Stable policies for stable budgeting is important. Timeframe fixation is a very important concern. Structural imbalances should be overcome.

Length and breadth of services in economic development should be understood.

Role of incentives in development and rationalization of the tax structures become important. Tracking and monitoring mechanism helps in the tax rationalization and the distinction between the essential and non essential commoditees.

Equity and justice should be focused upon so that people’s confidence and cooperation can be ensured. The Sun god picks up water vapour from few and distribute to all the areas. Hony Bea picks up the flower in a harmless manner. Thus, the Sovereign should sustainably tax the people and ensure the equity and justice. Tax evation is leading to corruption, criminalization, communalization and other ills. Hence, the tax net has to be widened and enforced.

Revenue growth and prioritization have improved a lot. IN 1960s and 1970s, 60 to 70% focus was on the irrigation. Along with the financial deficit, Governance Deficit should also be looked at and filled up. Perspective Plann should depend on the endowments and the capital. Resource endowment, human, knowledge, customer and social capital should be incorporated in the plan. Market status and potential should be understood. Economic Vision should visualize and actualize the plans. Japan’s perspective plan projects to 50 years. GDP growth rate is the function of the productivity growth rate.

Hence, skill development thus becomes very important. Non Employable Engineers and Technicians is a major problem in India. In Germany for example, a Technician performs the Engineer’s function. Little assistance should be able to translate itself into an inclusive society. Opportunities competence building, accessibility and utilization of the competencies becomes important.

a. Food,

  1. B. Water,
  2. C. Energy and
  3. D. Environmental Security should never be compromised.
  4. New initiatives should be taken up. Budget should be the instrument of the new initiatives.

Conversion of capital to revenue is important. Sale of land by the state in an uncontrollable manner is a mockery of capital generation.

Short Gestation projects should be focused and money can thus be generated for long term projects. Water, Energy and Environmental conservation should be important and food security should be made sustainable. Physical, Knowledge and Electronic Connectivity in the infrastructure should be ensured. This will ensure prosperous cities.

AP has missed the bus in terms of agro-processing industry. This has to be rectified. Gap appraisal and plugging should be important. Knowledge, Performance, Technology, Strategy, Credibility and Will Power gap should be plugged. Teem work and Teem building should be focused upon. Personal and Collective initiatives are called for by Dr. Gopala Krishna.

Open Session:

Chaired by Dr. G. Subramanyam, IAS

Dr. Subramanyam states that the knowledge creation process is not sufficient while making the budget. Objectives, Growth, the Quality etc are not fully defined. Awareness about the budget among the stakeholders is very limited.

Stakeholder engagement is grossly insufficient. Far less than ten percent of News paper space is allotted to the Economy.

State of Knowledge Capital, the extent of creation, the extent of dependency on the state and the ways to reduce such dependency are important. Why aren’t the economics professors conducting the pre-Budget workshops? Why isn’t there a full house during the pre and post budget sessions?

Fiscal Parameters are showing marked improvements. However, the targeting errors are also growing alarmingly in terms of the provision of social services. Non Bureaucrats should raise these questions. Bureaucrats are not allowed by the Conduct rules to raise these questions. Corruptions and Cutting Corners are becoming real problems. Youngsters are attempting and at times succeeding in cutting the corners. Pre and post Budget Sessions and also the common sessions with all the legislators are recommended by Mr. G. Subramanyam.


Structural Composition of the Budget should be better focused. Services led growth is not sustainable in the long-run. Hence, industrial growth rate should be a bit higher than the growth rate of the service sector. Service sector usually provides employment for the White Color people.

Labour force dependence on agriculture should be substantially brought down from 60% to at the most equivalent to the contribution to GDP. Power sector growth for exporting to other states should be the trump card for AP.

Political Session:

Welcome address by President Shekhar Agarwal: President Agarwal believes that AP will produce great results in future as in the past. Life of the economy is in the hands of our leaders.

Mr. Raghavalu of CPIM:

Sanctity and the prominence of the budget is gradually reducing. If at all some salvaging could be accomplished, it could be by the ruling party politicians. Lots of gap between the estimates and the actuals. Transfer of money from one to another department is often resorted to and the predictability of the expenditure is questionable. Lot of unspent money is lying. Decisions and the actual allocations do not tally. Democratic exercise in the pre budget and post budget exercise.

The way the Jalaygnam was planned and implemented is not according to the wishes of the CPI. Gestation period is very high and the estimates revised upward tenfold as per the international experience. Small and Medium projects were suggested by-and-large and large projects suggested in a phased manner.

Now, the works are not only incomplete, but also the work in progress is tardy. The capital invested thus became “Dead Capital”.

Backward and Forward linkages absent in road laying projects. Many roads laid in not so busy areas to benefit the rich people. Unlike in Tamil Nadu, Karnataka etc, development is not spread across the state. Harbors and infrastructure not well developed. Most of the concentration of industries is in and around Hyderabad and now partly in and around Visakhapatnam. Brain Drain is a major problem.

Many incomplete projects in AP. Commencement takes place without the stakeholder participation. Hence, agitations and protests cause indefinite delay. Power projects mostly concentrated in Nellore and Srikakulam districts. Spread is lacking. Power to other states and the affliction of pollution in AP? Neither White paper, nor the policy paper nor the discussion among the stakeholders and among the parties. Real estate simply booms. The one who contributes land for the power project or any other project gets less money and those who are adjacent enjoy an unprecedented boom in the real estate price. Gujarat seems to have some scheme to spread the benefit of the real estate boom in an inclusive manner.

Why can’t Vijayawada industrialists manufacture sandals? Why only they sell them and give excuses such as the lack of competitive advantages in spite of being in proximity to the market? Bureaucrats tend to dance to the tune of ministers’ tastes and preferences. Even in the areas of contracts and the movie industry, AP tends to lag behind unlike the past. Systems and Institutions should govern the state rather than the personality cult.

Mr. Srinivasarao of Lok Satta:

20% variation between the estimated and the actual expenditure. Out of the five or six priority areas, firstly, agriculture should be focused upon. This is on grounds of higher percentage of population and less amount of per-capita income to the farmers.

Lack of sufficient storage for the crops. Agricultural exports discouraged in spite of surplus production. Neither the farmer benefits nor the consumer benefits. The crops get spoilt due to lack of sufficient storage facilities. Mirchi farmers are all right because they have sufficient cold storage facilities. Vegetables and food products need to be processed and cold stored. Why should Tomatoes cost one rupee in one season and over 40 rupees in another? This is due to lack of storage. Utilization of the Agri Waste is highly insufficient. Mere free power to the farmers is useless.

Skilled personnel like the Plumbers, Carpenters, and Electricians etc are lacking and it is hard to get their appointments. It is enough to spend 2,500 crores to train and employ about ten lakh skilled professionals. Central Tool Design Institutes should be set up in each and every district. Railway development mostly took place under the British rule.

400 KM of coastal Corridor leased only to three companies. However, The biggest ship yard in Singapore occupies only 45 Sq Km. Even Government Power Plant: viz : the NTPC’s Simhadri pollutes many villages with its ash destroying the agricultural productivity of the land. Thousand townships can be developed across AP with the investment of only 25,000 crores.

Mere 8,000 crores or over 6% of the state budget to local Governments or a Per-Capita fund transfer of Rs. 1,000 will do wonders because local bodies and people know what they want and will implement appropriate schemes. AP’s Wind Power bought by Gujarat. Among the big states, AP is low in development. Over three million graduate unemployed are roaming around. It is a potential destabilize of the society.

Lok Satta shall always be a positive force in the Development.

Mr. Bandaru Dattatreya of the BJP:

Budget document is a respectable document to be approved by the Government, the Legislature and the people. There is really no sanctity to the budget these days. In spite of being approved by the legislature, reallocation of funds and the watering down of the schemes occur most often in spite of the availability of funds. Fulfilling the election manifesto is most important.

Opposition parties should be the guiding force for the ruling part. Usually, the opposition parties tend to disrupt the proceedings, stage a walk out etc. Political stability is paramount to fulfill the budgetary objectives and commitments. Law and Order, a Decisive and Dynamic Leadership are also very important. A political party should be elected consecutively twice so that full justice can be done to the election manifesto.

Transparency is most important. People believe in those who practice honesty and transparency. Credibility gap should be plugged. Delhi Chief Minister Mrs. Sheela Deekshit meets and takes suggestions of and assistance from the Union Ministers most often. This budget of AP neither suggests a direction nor leadership. AP’s position should be first ascertained. AP’s advise was sought after during the Chief Ministership of N. Chandrababu Naidu or the NDA rule at the Center. But now, even Biharies take pride in their own achievements and vision.

The present Government is based on the personality cult and there is competition to get things prioritized. Food security and Farmers’ livelihood security are important. Over 30% of agricultural: especially food output is likely to be lost. Over 22,500 crores of property damage faced by the farmers due to the recent natural disasters. Marketing and other infrastructure and extension services are lagging far behind.

Prioritization of the irrigation projects does not take place and hence all the projects tend to progress tardily. Where is the National status for the Polavaram project? Government’s loans higher than the budget by over 11%.

Only a third of or at times a fourth of allocation is spent on Jalayagnam. Not even a fourth of irrigation apacity is added through Jalayagnam after commencement in 2004. By 2010, about 98 lakh acres of irrigation capacity is supposed to be added. Hypocrisy seems to be the trait of the political parties.

Government should take up the responsibility in producing power and AP Government has not taken interest in PPP in power production. Gestation period, pollution, and other issues related to rehabilitated not properly monitored by the Government. Coastal area is thoroughly misused in AP.

Rural roads are key for all round development and natural disaster management. Coastal roads not even built after the Diviseema disaster of 1977.

Hence, repeated natural disasters are causing hardships to the people. Power cuts are too many and already in March, rural areas are enjoying ten hours of power cuts. Skill development is adversely impacted by delay in fee reimbursement to the higher education institutions. At-least share the situation with the opposition parties concerning the priorities, reasons for lagging behind and failures. AP needs a proper leader. In spite of the Telangana movement, AP still has lot of economic opportunities and potential. Proper investment climate should be created so that AP can attract investment like the Gujarat. First, eliminate the political corruption. Bureaucratic corruption will automatically reduce.

Mr. Narayana of CPI:

Dedicated political leadership should form part and parcel of the perspective.

Outcome based budgeting needs to be introduced. Prioritization did not take place in Jalayagnam. Digging of canals is merely for the purpose of capturing votes.

Canals are dug far away from the actual project area with or without the prospect of linking up.

PPP should be with a human face. Bridging of the gap between the haves and the have not is necessary. Ecological balance is disturbed severely in Nellore district’s coastal area with the construction of 28,000 MW Power plants in just 20 SQKM of area.

Industries in coastal areas simply dumping waste in the sea. Fishermen who used to catch near the coast are now forced to go at-least 20 Km inside. Budget should guarantee the agricultural output and marketing. Health and education sectors should receive budgetary protection so that the Human Resources can be strengthened.

Outcome should be measured in terms of social development. Bureaucracy should act in accordance with the guidelines of the political parties. To realize this, political parties should be gutsy. To be gutsy, sincereity is paramount. Most of the present politicians are neither sincere nor gutsy. Over a lakh of crores of Rs. Are invested by Andhra Pradesh based and Telugu origin people in Gujarat.

Social accountability and punishment for failure should be enforced. Accountability should ensure the spending of the allocated money.

Y.Sujana Chaudary, PM of Telugu Desam Party:

What is the agenda here? Is it the Political Corruption or Budgetary issues? There are lots of shortages in the system. Variation analysis: viz : the allocated Vs. the actual is lacking. In spite of Windfall revenue from the Araku Valley projects, funds were not released for IIIT severely jeopardizing the admissions. AP ranks #15 in education among the large states with only Bihar lagging behind.

Attempt to plug the deficit through the Liquor based duties is counterproductive in health and investment aspects. Politicians should intervene only in special situations. Normative administration must be carried out by the bureaucrats. Much of it can be undertaken by the lower level officials. Farmers are only used as the vote bank and hardly any attempts are made to ensure sustainable income. No one knows how much and how properly the skill development is spent. Quality of education has gone down to a marked extent.

Will power is lacking in the Government and among the politicians. Finance Minister has no subject knowledge pertaining to the budget and economics. Blue print should be proper so that lower level officials can implement the projects. Urban congestion is increasing and decongestion needs to be encouraged. Targeting is poor while undertaking social welfare measures. Variation analysis should be outsourced.

Mr. Kamalakar Rao of the Indian National Congress:

50% of opposition party delegates’ opinions are empathized by Mr. Kamalakar Rao. Errors should be realized by the Government and rectified. Realization and rectification will take place. Internal democracy is strong in the party. Kamalakar Rao is needed by the party to prepare manifesto and action plans. Lot of lobbying and convincing is necessary to implement a scheme in the Congres Government unlike the parties based on the personality cult.

The society is pluralistic. All the stakeholders are important. Obtaining votes is even more important. The budget hence has degenerated as “Reactive” budget. Governments yields to the demands. Appropriate ways of demanding should be resorted to so that things can be get done.

Potturi. Venkateswararao: Senior Journalist

What does it mean by lower fiscal deficit? Government is understaffed. There is no money for proper maintenance of the Government machinery including the vehicles etc. Yet, a lesser fiscal deficit achieved and propagated.

Bureaucrats tend to present only about few sectors of the economy or one or two developmental schemes. But, the broader questions of farmers insolvency, suicides and the lack of “Trickle-Down” of the income are not focused. Why are farmers afraid of undertaking agriculture? AP people obsessed with Real Estate Management. Real industrial development is not taking place.

Are the Nationalized banks really disbursing 18% of deposits as agricultural loans? Is there a mechanism to monitor the mandatory commitments of the Banks? Permanent lecturers not re-employed while contract lecturers’ options are open. In many instances, contract lecturers are paid more than the permanent lecturers and in many instances far less.

Minister simply reads the speech prepared by the officers. State of health of the state is certainly not in a good shape. Almost the whole of the Excise revenue is going for loan repayment. In spite of tardy progress or lack of progress in irrigation works, contractors are paid money. Here is high potential for corruption. Irrigation canals mostly useless after the rainy season.

Dr. B.G. Shastry.

Indusive and conducive climate, efficiency in service delivery, Technical and Economic Efficiency are the key drivers of growth in manufacturing sector. Linkage between the positive intentions and actions is not concrete. Small and Medium industries are not attracting enough capital and skills.

Professor Ram Kumar Mishra:

Gujarat is not doctoring the figures. Gujarat is achieving real growth. AP was doing it in the past. But now, doctoring of the figures is a reality. Food inflation should be overcome to achieve real growth rate. Supply chain management will render justice to the producers and consumers while doing away with exorbitant profits for the middlemen.

The kind of PPAs agreed upon while agreeing upon the power projects is a matter of alarm. PPAs prove costly to the Government and to the consumers. The gestation period for the power projects is a matter of alarm. It is very long. CAG lists a variety of lost opportunities for AP. We should have utilized the “Super Critical Technologies” very long ago. Tax/GDP ratio should be compared to the income levels. Those countries with 15 to 30 or more times the income levels of India can afford to have a Tax/GDP ratio of over 20% yet leaving people with lots of disposable and savable incomes. IN India, about 11% is ideal for the time being. Presently, it is 9%. Professor Mishra recommends Power and Higher Education to be transferred to central Government. Mumbai Municipal Corporation has greater level of income than all the North-Eastern States put together and a couple more states.

Scandinavian countries are really interested in AP. Even Japan is interested provided proper plan is prepared and executed. AP should do well. Else, it will backfire on the Central Government. AP Politicians are playing with the sentiments of the people. Better economy, society, Consumption and Social basket are all necessary. People deserve them.

Thursday, March 10, 2011

Meeting with Dr. Ajit Rangnekar, Dean, ISB, Hyd

The Federation of Andhra Pradesh Chambers of Commerce and Industry (FAPCCI) organized an interactive meeting with Dr. Ajit Rangnekar, Dean, Indian School of Business, Hyderabad, at Sailing Annex, Tank Bund, Hyderabad. Mr. Shekhar Agarwal, President, FAPCCI, Mr. Narender Surana, Convenor – FAPCCI CEO Forum, Mr. Devendra Surana, Vice-President, FAPCCI, Mr. K. Harishchandra Prasad, Past-President, FAPCCI, Invitees, Members of Managing Committee, Past-Presidents & Members of the Federation were also present.
Mr. Ajit Rangnekar, Dean, Indian School of Business, Hyderabad while delivering his keynote address said about Inflation Corruption & Exodus (ICE) he said that Inflation is all time high with 97% those people living of cove down. He expressed that in next 20 years 35 Crores people are moving from Rural area to Urban area. He suggest that for those 35 crores people Indian Government has to plan for the necessary Infrastructure & skill development, where manufacturing, health, infrastructure & good Public Administration has to be growth lines. Mr. Rangnekar said that ISB is going to start new Institute at Moula-ali with in this Fiscal year. He talked about agriculture productivity and said that the instead of small agri unit’s big aggregate firms, short work & best technology must improve. For this Mr. Rangnekar said urban infrastructure should agree-cute much in advance before it got scumbled. Mr. Rangnekar compared Indian Urban Infrastructure with China urban development where china is planning multiple ring road planning’s for future development. He said that to improve the economic growth in society disciples must require. Mr. Rangnekar expressed that USA had done a big mistake by not given more importance to manufacturing sector, based on this he said that India contribution towards manufacturing sector is GDP 16% and it has to be increased to 25% in near future. Even he also said that not only manufacturing even India has to contribute toward Infrastructure, Agriculture, IT Sector, Health and other needs to change Indian economy.

Mr. Shekhar Agarwal President, FAPCCI, said that Indian School of Business has been formed to bring in the best of global management practices and recognize the rapidly changing business leaders with an understanding of evolving economics. He said that the economic centre of gravity is shifting from the developed markets to the developing markets. Mr. Agarwal said that FAPCCI has been given representations on the Institute Management Committees of Industrial Training Institute, Andhra Pradesh, with the objectives of providing a platform for continuous quality improvement in training and is driven by the needs of Industries.

Mr. Agarwal even said that FAPCCI & ISB can work together in bringing greater awareness and immensely contribute to the economic growth of the state. For this Mr. Agarwal requested Dr. Ajit Rangnekar to kindly consider the Sharing study and Research reports published by ISB, Training for Upgrading MSME Units, Sharing of Webcasting, Involving ISB students in developmental projects and Organizing Joint Training Programs/Seminars. He said that these initiatives would definitely help FAPCCI & ISB to help the industry in achieving the global standards.

Mr. M.V. Rajeshwara Rao offered vote of thanks and expressed his thanks to the guests and participants.

Saturday, March 5, 2011

Recent Amendments in the PF Act

The Federation of Andhra Pradesh Chambers of Commerce and Industry (FAPCCI) in association with Employees’ Provident Fund Organization (EPFO) organized an interactive meeting on “Recent Amendments in the PF Act” with Regional Provident Fund Commissioner, Hyderabad Zone Mr. N. Narayanappa on 5th March 2011 at Surana Udyog Auditorium, Federation House, FAPCCI, Red Hills, Lakdi-Ka-Pul, Hyderabad.

Mr. Shekhar Agarwal, President, FAPCCI, Mr. K. Srinivas, Assistant Director, Regional Provident Fund Organization, Mr. V.S. Raju, Senior Vice President, FAPCCI, FAPCCI, Mr. S. Subba Rao, Chairman, HRD & Industrial relations, FAPCCI, Mr. M.V. Rajeshwara Rao, Secretary General, Mr. V. Kumar, Co Chairman, HRD & Industrial relations and many professionals from the industry participated at the interactive session.

Mr. N. Narayanappa said in his key note address that EPFO extends the services to employee like maintaining PF accounts, Employee Pension Accounts, Employee Deposit linked insurance scheme. EPFO also offers housing, medical and marriage loans to the scheme holders and the disbursements will be made within 30 days to the beneficiaries. Recently all the municipal workers also covered under the Employee Provident Fund Scheme. In order to address the problems regarding PF recently e-Filing facility has been introduced. All the PF office was computerized and the services would be more effective in the future. During interactive session the PF officials clarified the queries raised by the participants.

Mr. Shekhar Agarwal requested request Sri M. Narayanappa to kindly apprise on this new module and several other initiatives of the Provident Fund, for the information and benefit of the participants.

Every year annual statement of accounts showing the total accumulated contribution including the interest earned is being sent to each member through the factory or other establishment where the member was employed. However, the accumulation fund towards the pension fund is not included in the statement of account. This may kindly be taken up with the Central Provident Fund Commission, so as to keep informed each member about the pension fund also.

Mr. K. Srinivas presented power point presentation on e-Filing system and distributed EPFO e-Filing software freely to the participants.

Mr. V.S. Raju honored the guests and offered vote of thanks.

Mr. M.V. Rajeshwara Rao welcomed the guests.

Tuesday, March 1, 2011

Union Budget 2011 – Impact on Industry and Trade

The Federation of Andhra Pradesh Chambers of Commerce and Industry (FAPCCI) with knowledge partner of Ernst and Young has conducted a meeting on Union Budget 2011 impact on Industry and Trade on 1st March, 2011 at 4:30pm at FAPCCI.

Mr. Shekhar Agarwal, President, FAPCCI in his welcome address stated that there was a robust credit flow in 2010-2011, but a marginal decline in 2011 – 2012 due to steady increase in lending rates. Priority sector lending has received a boost as their will be lower lending rates to borrowers. Interest on Agriculture loans, subvention upto 3% will increase availability of funds at cheaper rates.

Mr. Abhay Kumar Jain, Chairman, Direct Taxes committee of FAPCCI stated that the Union Budget has great impact on the Economic Growth of the Country which in turn will have impact of Trade, Commerce, Industry, Banking, Capital Markets and other sectors of the Economy. So the stakeholders are interested to analyse the impact of such budget on the economy and various sectors.

Dr. S.K. Rao, Director General, Administrative Staff College of India, in his address stated that the budget for 2011-12 has been a good balancing act by the FM, as he was facing the daunting task of stimulating the economy, keeping the inflationary expectations under check and at the same time boosting public finances.

The budget was relatively silent on the big-bang reform process, especially on FDI in retail and insurance and reduction in government subsidies. The fiscal deficit at 4.6% might look attractive, but getting into the details reveal that the budgeted subsidy amount seems to be abysmally low in light of the fact that fuel, food and fertiliser inflation remains elevated on account of soaring global prices.

He further stated that the budget has set the ground for rolling out of the Goods and Service Tax (GST) that shows the commitment of the government.

Mr. Jagadeeshwar Rao, President, Association of National Stock Exchange Member in his address stated that the budget is positive for equity as well as bond markets. Mutual Funds being allowed to raise money in equities from foreign investors directly are a big plus. This will allow investors across the globe to invest in Indian mutual funds and help bring money into the economy. The Budget 2011-12, though it did not have many significant direct measures for the Capital Goods sector, it sent a positive signal with regards to the continued impetus being provided to the Infrastructure and Power Sector of the country.

Mr. Jayesh Sangvi, Partner, Ernst & Young Pvt. Ltd., and Mr. T.S.Ajai, Chartered Accountant had explained the implications of the Union Budget 2011 on Direct Taxes

Mr. S. Thirumalai, Sr. Advisor, Deloitte Touche Tohmatsu India Pvt. Ltd., and Mr. B. Shanker, Sr. Advisor-Tax & Regulatory Services, Ernst & Young Pvt. Ltd. had explained the in-depth intricacies of the Union Budget on Indirect Taxes.

Meeting ended with a vote of thanks by Mr. V.S. Raju, Sr. Vice President, FAPCCI, Mr. Devendra Surana, Vice President, FAPCCI also attended the meeting.