INDIAS PROMISE

Challenges & Opportunities

Political Uncertainty
Delhi, Capital City
POP: 13 million

COALITION
GOVERNMENTS
TO STAY

Bangalore
Silicon Valley of India
POP: 7 million

Cong+

219 Seats

BJP+

189 Seats

Left

61 Seats

Others

70 Seats

ECONOMIC
REFORMS
SECURE

UNITED PROGRESSIVE ALLIANCE

13 Constituents
Indian National Congress

Congress Allies

Left Front

UPA COMMON MINIMUM PROGRAM

Agriculture - A New Deal For Rural India
Infrastructure - Building World Class
Sonia Gandhi Pranab Mukherjee Sharad Pawar Prakash Karat Karunakaran
Employment - Rozgar Badhao
Education - Improving Access and Excellence
Health Care - Creating Capabilities
Water - Better Access, Better Utilization
Kamal Nath
Bhattacharyajee Nirpuam Sen
DMK
Praful Patel
Urban Renewal - Humane and Modern

UPCOMING STATE ASSEMBLY ELECTION

80 Parliamentary
Constituencies

4 Phase Poll
April / May

Population
179,000,000

Transparency

BELL HELICOPTER

MOTOROLA

Procurement Challenges

RED TAPISM
July 2006

1500 KM
8 Days

RED TAPE / TAX ANOMALIES / POOR INFRASTRUCTURE

Challenges in Infrastructure

48 new road projects worth $12 bn are presently under construction

Indian Railways require $22 bn investment

Indias port upgrades require a total investment of $22 billion

Domestic aircraft movements have shot up by 40%

Modernization requires upgrading 25 of the countrys national airports

100,000 MW required by 2012

LAND ACQUISITION-SEZs
NANDIGRAM

16 KILLED

WEST BENGAL

68 WOUNDED

5000 POLICE

TOTAL BANDH

HIGHLY POLITICIZED SEZs ON HOLD

HUMAN RESOURCE CONSTRAINT

ITES/BPO INDUSTRY GROWING @ 45% Qtr

QUALIFIED HELP IN SHORTAGE

ATTRITION RATES > 30%

FINISHING SCHOOLS REQUIRED

CONTRACT LABOR & LABOR REFORMS A MUST

INDIAS ECONOMIC LEADERSHIP

Considered the Father of Indias Economic Reforms
Economist by training, Strong free-market advocate
Excellent rapport with President Bush

Manmohan Singh
Prime Minister

Montek Singh Ahluwalia

Planning Commission Deputy Chairman

Private / Public Sector Interlocutor
Economist by training, Oxonian
World Bank background / Easily accessible

P. Chidambaram
Minister of Finance

Inclusive Budget
Supreme Court Advocate, Harvard MBA
Pragmatic reformer

SCORECARD ON REFORMS
Progress
Insurance FDI up to 26%

Telecom up to 74%
Oil/Gas, Roads, Ports up to 100%
Real estate opened to 100%

200
180
160
140
120
100
80
60
40
20
0

Open Skies: Boeing Sales

1995

2000

2006

GDP Growth Rate > 8%

Patents Act -IPR Protection: Re-entry of Merck

Retail (Single Product): Wal-Mart Entry
Civilian Nuclear Cooperation 123 Agreement

6 Million New Cell Phones

Registered Last Month!

15 Special Economic Zones (SEZs) at present

42 approved for 2007

IT/ BPO Boom

More than 300 of the Fortune 500 are in India
IBM
Cognizant
General Electric:
Oracle
Hewlett-Packard
Honeywell
American Express
Dell

: 53,000 employees
: 48,000 employees
: 20,000 employees
: 18,000 employees
: 11,000 employees
: 7,000 employees
: 4,000 employees
: 3,800 employees

MANUFACTURING
Automobile Components - Worth $15 bn
20 % Annual Growth in Exports

Ford Producing 30,000 units;

Doubling Capacity in 2006-2009 timeframe

General Motors Expecting to sell 30,000

units in 2006; output to be doubled

Boeing - $12.1 bn sale of civilian aircraft to Air India

with significant co-production; recognition of Indias
manufacturing prowess

OPPORTUNITIES IN AGRICULTURE

Blue Diamond Growers India is 4th

largest and fastest growing market
Pepsi is a major player
with sales $700 mn
Coca Cola has major presence
throughout the country

$15 bn investment
opportunity in storage,
transportation,
and refrigeration facilities.

McDonalds has introduced the McVeggie

burger and Veg Pizza McPuff

Domino Pizza, Pizza Hut and Kentucky Fried Chicken

have all established restaurants in India.

U.S. DEFENSE COMPANIES

Fremont Group

DEFENSE TRADE
Next Steps in U.S.-India Strategic Partnership:
Major Opportunities in Defense Cooperation - $30 billion

F-18 Super
Hornet

C-131
Transport

P-3 Orion

GE-404
Engine

Bell 407
Helicopter

F-16 Fighting
Falcon

FireFinder
& PAC III

Pac-3
Antimissile
System

Boeing 737
Countermeasure
Equipment

US-INDIA SPACE PARTNERSHIP

An Important Component of Strategic Partnership

Indian Space Program 5th largest after U.S., Russia,

Europe, China

$450 mn annual budget, but due to lower wages is

equivalent to multi-billion dollar program in U.S.

Space Exploration Chandrayan I: India plans to launch

its first unmanned mission to the moon by 2008

NASA agreement with ISRO to send scientific instruments

into space aboard Indias Chandrayan I

Export Control Regimes; Strategic Partnership Challenges

NEXT WAVE: PHARMACEUTICALS

$6.5 bn and growing at 8-10%

4th largest pharmaceutical

industry in the world

Expected by 2008 to be
worth $12 billion

Private Hospitals firmly entrenched: Apollo,

Manipal, Escorts, Max Healthcare

Medical Tourism

INNOVATION FRONTIER

India Development Centre,

Bangalore, Hyderabad

Labs India, Bangalore

R&D Centre, Bangalore

R&D Centre, Bangalore and Mumbai

Software Lab, Bangalore, Pune

India Engineering Centre, Bangalore

R&D Centre, Bangalore

Innovation Campus, Bangalore

Bangalore

INDIA LOOKS OUTWARD

Tata Group - $12 BN

Reliance - $22 BN
Essar - $9 BN
Birla - $6 BN

VideoconDaewoo Electronics-$650
Dr. Reddys LabBetapharm - $570
RanbaxyTerpia - $324
VSNL Tyco Global-$130

WHY INDIA ?

ECONOMIC, IDEOLOGICAL &

STRATEGIC PARTNERS

Coherent democracy; Pluralist/Secular

1/5th Worlds Population; 2nd largest military in the world
Common Values: Against Terrorism, Trafficking, Narcotics
Ideological Partner re: Nepal, Sri Lanka, Bangladesh, China
Common Law Judicial System
2nd largest number of Doctors, Engineers, PhDs in the world
100,000 Students to U.S. Each Year
1.8 mil Americans of Indian Origin
Politically significant; Politically integrated
54% of Indian Population is under the Age of 25

India is Rising, Becoming Vital to U.S. Interests

BARBOUR
GRIFFITH &
ROGERS
eMR
Technology
Ventures

U.S.-INDIA BUSINESS COUNCIL

Griffith & Rogers

Steptoe &
Johnson LLP

32 YEARS of GROWING ENTERPRISE

Accenture
Adobe Systems, Inc.
Akin Gump LLP
Altria Group, Inc.
AM General LLC
Amas Investment &
Project Services
Amway Corporation
Andrews Kurth LLP
Baker & McKenzie LLP
Bank of America
Bloomberg
Boeing Company
Cargill
Caterpillar, Inc.
CBay Systems

Chevron
General Dynamics
CMS Energy
General Motors
The Coca-Cola Company Gerson Lehrman Group
Computer Associates
Guardian Life Insurance
Covanta Energy
Gerson Lehrman
Dell Computer Corp.
Guardian Life Insurance
Deloitte & Touche
Hughes Network Systems
Discovery CommunicationsIBM, Corporation
Dow AgroSciences
IDFC Ltd.
Dow Jones
Johnson & Johnson
DuPont, Inc.
J.P. Morgan Chase
eBay Inc.
K. Raheja Universal
Estee Lauder
Kotak Mahindra
Ford Motor Company
L-3 Communications
Fremont Group Limited
Lockheed Martin

McGraw-Hill
Target Corporation
Merck & Co.
Tata, Inc.
Microsoft Corporation
Texas Instruments
Monsanto
Textron Inc.
Motorola, Inc
Time Warner Inc.
News Corporation Ltd.
Thomson Financial
Northrop Grumman
United Parcel Service
Oracle Corporation
Vickery International
PanAmSat
Wal-Mart Inc.
Paul Weiss LLP
Watson Wyatt Worldwide
Pfizer Inc.
Xerox Corporation
Pratt & Whitney/United
Technologies
Sony Pictures Entertainment
Standard Chartered Bank

INDIAS ENERGY SECURITY CHALLENGE

Gas pipeline from
Turkmenistan, through
Pakistan, but
questionable reserves

Oil discovery by
Cairn Energy in
2004; Indias
demand will
outstrip supply

Gas pipeline from

Iran, discouraged
by U.S.

Kakrapar- Worlds
first thorium-based
nuclear reactor

Hydro-Electric Dam at
Narmada constrained by
problems with
environment

Coal supplies for 200

years, but high/ash,
low calorie value

Gas pipeline from

Myanmar through
Bangladesh discouraged
by U.S.

Tarapur- Indias
civilian nuclear
reactor requires
refueling

Gas discovery by
Reliance in 2003
but will service only
fraction of Indias
power needs