The National Telecom Policy 2011 will lay special emphasis on providing affordable and quality telecommunication services in rural and remote areas, said Prime Minister Manmohan Singh on Wednesday. "It is estimated that every 10 percentage point increase in broadband penetration leads to a 1.3 per cent increase in a country's Gross Domestic Product, said the prime minister. "The NTP 2011 looks forward to high speed and high quality broadband access to all village Panchayats through optical fibre by the year 2014 and progressively to all our villages and habitations." The government aims to achieve 175 mn broadband connections by the year 2017 and 600 mn by 2020 at minimum download speed of 2 mbps. The penetration of wireless voice services has increased from about 2 per cent in 2000 to about 72.1 per cent in August 2011. "India is the fastest growing telecom market in the world, with the addition of over 18 million subscribers every month," he said. The Prime Minister was speaking at the three-day conference cum exhibition - India Telecom 2011 in Delhi. The event with an underlying theme of 'm-powering India' was organised by Ficci in collaboration with the Department of Telecommunication (DoT). The event aims at providing the business linkages between the Indian telecom industry and international telecom fraternity. The government is committed to sustaining growth of the country's telecom sector, Prime Minister Manmohan Singh said on Wednesday, seeking to boost investor confidence in the once-booming sector that has been hit by regulatory uncertainties."I am aware of some concerns of the telecom industry regarding government policies in the telecom sector," Singh told a gathering of telecom industry executives on Wednesday."I wish to reassure industry of the government's full commitment to sustaining growth, creativity and enterprise in this vitally important sector of our economy," he said.In the new telecom policy, which is expected to be finalised by early next year, the government seeks to relax rules for mergers and acquisitions in the telecoms sector to facilitate consolidation in the crowded 15-player market.India opened the sector for private participation in the mid-1990s. Lower call tariffs and aggressive network expansion by companies to smaller towns and rural areas has seen the sector adding mobile phone users at a fast pace to 870 million currently, from about 5 million in 2002."The telecommunications sector is one of India's success stories," Singh said.The government over the next 2 years plans to create a National Optical Fibre Network (NOFN) with an initial-phase cost of about Rs 20,000 crore. The private sector will contribute equal amount to complement the infrastructure by providing access services to the individual users. The PM noted that viewing the growth potential for the manufacture of telecom equipment there is an urgent need to boost the domestic research & development and manufacturing in the telecom sector. The prime minister was addressing the telecom exhibitors and delegates during the inauguration of India Telecom 2011 - three-day conference cum exhibition. The minister of information and communication technology Kapil Sibal, who was also present on the occasion said, "With a subscribers base of 899 mn in India and 120 mn international users, our country is the second largest telecom market in the world. Over the last 5 years the overall tele-density has grown from 8.95 per cent to 74.96 per cent. While overall tele-density has increased 5 times from 26 per cent to 164 per cent, the rural tele-density has increased significantly from 1.73 to 6.9 per cent."Sibal added that the telecom sector is the third largest recipient of the FDI. In the next 5 years the India telecom sector will require investment of Rs 6.5 trillion with the implementation of NOFN, deployment of 3G infrastructure, telecom green technology and widening of VWA network. This will generate huge investment opportunities propagating an investor friendly echo system in our country. More than 256 exhibitors from 36 countries are attending India Telecom 2011. Some of the prominent exhibitors include BSNL, MTNL, WiMax Forum, Ericsson, Vodafone Essar, Bharti Airtel, Sistema Shyam Teleservices and Nokia Siemens Network.
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It was a good week for the markets, largely because there was no bad news. Bargain hunting at lower levels from foreign institutional investors (FIIs) on back of positive news flow from Europe and impressive results from software bellwether Infosys Technologies helped keep the momentum going for the Indian equity market. It ended the week with a gain of 5.2 per cent. The momentum in the coming week will be almost purely dictated by September quarter results, especially from heavyweights Tata Consultancy (TCS), Larsen & Toubro and HDFC Bank. Reliance Industries announced its quarterly performance on Saturday October 15, which were in line with expectations."I don't expect much from the quarterly results. But any disappointment from biggies can bring down the market next week," says Avinash Gorakshakar, vice president at Edelweiss Financial Advisors. With the Sensex up 8.5 per cent in the past seven sessions, any disappointment will lead to a sharp correction in the market. On Monday, the mood will purely be dictated by Reliance Industries, HDFC and TCS results. TCS is expected to record a sequential quarter-on-quarter net profit growth of 6 per cent at Rs 2,520 crore.All eyes will be also on the outcome of the European Union (EU) nations meeting on 23 October 2011 that are meeting to discuss the bailout of Greece and other heavily indebted European nations.Past as Prologue?In the week ended 14 October 2011, the Bombay Stock Exchange (BSE) Sensitive Index (Sensex) ended above the psychological mark of 17,000. The Sensex gained 850 points to end at 17082.69. All thanks to foreign inflows that even forced bears (market players) to cover their short position this week. Players had gone short in the market following the concerns surrounding sovereign debt crisis in the Euro-zone, but FII buying on positive news flows from Euro-zone forced players to cover their short position, thus helping the Sensex to record gains this week. In the four sessions till 13 October 2011, FIIs invested nearly half billion dollar. However for the month of October they still continue to remain net sellers to the tune of $86 million."The recent recovery in the market to a large extent has been due to the positive news flows from the Euro-zone," says Anand Shanbhag, ED and head of research at Avendus Securities. Though the rise is positive, he feels it's not a full recovery and there is still some uncertainty left in the market over domestic and global concerns. Domestic concerns surrounding the market are inflation, interest rates and rising energy prices, while the globally it's the European debt crisis. "Until such time one can't forecast a complete recovery. In such circumstances the index (Sensex) could stay in a trading zone up to 6 months," says Shanbhag who feels players (institutional) are risk averse to equities and it will take some time before they come back to the market.With the sharp rise in the past few sessions, experts feels there isn't much upside left in the market. But the good news is there isn't much downside either. "From the current levels (17,000), the market doesn't seem to fall over 10-15 per cent," says senior analyst at the Mumbai-based financial services on condition of anonymity. So what should investor do in the current environment? "I see the next two quarters (September and December) bad for Indian corporate," says Gorakshakar. He still sees some pain left in the market and therefore would like to park his fund in fixed income and use the downfall to accumulate stocks. "Today I have invested 50 per cent of my money in FD (fixed deposit) which is giving me 11-12 per cent return and I am waiting for the market to correct," says Gorakshakar.With uncertainty still prevailing in the market over bail-out of European countries and Reserve Bank of India's (RBI) monetary policy on 25 October 2011, which is expected to hike rates –13 times in 19 months –to capture the rise in inflation, investors would be better-off waiting on sidelines. Rather than buying cheap in an uncertain market, it always better to buy slightly higher in a clear market environment.
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September has been a cruel month for victims and whistleblowers. On 28 September 2011, J.S. Verma, General Manager of Essar Steel, found himself in the slammer accused of funding Naxal groups in Dandewada area of Chhattisgarh. The same day, Sudheendra Kulkarni, former aide of BJP stalwart L.K. Advani, was also taken into custody, accused of bribing his own party's MP's to help the Congress Led UPA government survive a vote of confidence in July 2008. Neither the extortionist, nor the primary beneficiary of the intended bribe, suffered any consequence. Does this make any kind of sense at all?Let's deal with the facts.The Chattisgarh police have been very active in arresting people who hand money over to the Maoists. As part of this tit-for-tat campaign, they caught up with a contractor called B.K.Lala who they accused of paying off the Maoists to protect Essar's267 km pipeline from Bailadila to Vizag.Lala reportedly told the police that the money came from the General Manager's office so Verma was booked under Section 121 of the CPC for waging war on the State and other sections of the Unlawful Activities (Prevention) Act. Essar of course denies that they ever pay anyone off. How does one read this situation? The Essar pipeline has been damaged 15 times since Oct 2005 and the police can't do very much about it. We can safely assume that leading industrial houses do not willingly gives money to terrorist. If we assume that everything the police say is true, what is the storyline? The police could not protect the people from the terrorist's demands so the people met the terrorist's demands and now the police accuse the people of supporting the terrorists. That sounds a lot like my security guard arresting me for not using his services while admitting that he cannot provide me security. It seems the main choice is to get the pipe blown up or get arrested. Would it help to report the upcoming extortion to the police and help them nab the criminal?Is whistle blowing a solution? We come to that in a moment but hear another story first.On 24 August, the police filed a charge sheet in court accusing famed deal maker and former Samajwadi Party leader Amar Singh and L.K. Advani's aide Kulkarni of conspiring to bribe three BJP Members of Parliament to help the Congress led UPA survive a vote of confidence in the Lok Sabha in 2008.Amar Singh allegedly used Kulkarni to deliver the money to the MPs. We know that these three MPs accepted the money, took the money to parliament and chucked it about to show how the UPA was engaging in skulduggery. The charge sheet does not name anyone in the UPA government, so the beneficiaries of this scheme remain blameless. Kulkarni doesn't understand how he is in jail because as far as he is concerned, he is a whistle blower. No doubt he will agree that he did not blow the whistle - the three MPs did -but he worked for a BJP leader and other BJP MPs were being bribed, so you can see the argument that he was one of the good guys. In any case, these three MPs are also in jail too. I would say that these three MPs are whistle blowers because if they were in it for the money, the MPs would have kept the money rather than display it in Parliament. The moral of story then is clear. If you are a victim or a whistle blower, you are going to get it in the neck. If you are the beneficiary of the scheme, all you need is credible deniability. I hasten to add that I am not blaming the police for anything. I am also not blaming the magistrate for anything. Since the two cases address the same issue but span two different laws, we need to look at them separately. Consider first the Essar case. If someone squeezes you, or threatens to explode a bomb under your butt, what are your choices? You have four. First, you can go to the cops and hope someone takes you seriously. This country is full of people who scream death threat in order only to get a free gun toting body guard they can then flaunt as a status symbol. You would have to work hard before the cops would take your seriously. Even if they do take you seriously, do they have the capacity to protect 267 km of pipeline? Your second choice is to buy protection from the hoods. This is not outrageous: protection is a significant part of urban life in a significant portion of the urban world around the globe. However, if you get caught, Verma will tell you what happens to you. You do have a third choice: you could go to the police and say, I have to pay the extortionist and so help me nab him while I pay him. Considering how the local police has been infiltrated around the world, leave alone India, what are the chances the extortionist won't know in advance that they have been set up? Do you expect to nab the culprits or stop a bullet? Finally, you could pay the extortionist off and then go to the police and say, "this is the guy I paid. Now go catch him." This option would be viable if the cops were capable of catching him. Considering the numbers of Maoists on the loose in Chhattisgarh, what would you rate the chances? The way I see it, your only realistic option is to pay him off in any case: then you can pour yourself a stiff one and ask yourself if you should turn whistleblower. In truth, this question is only worth asking if we haveeffective whistle blower legislation in place. As things now stand, you are going to get arrested for paying a terrorist because you are too afraid to die for a nation that will not protect you. You need effective whistle blower legislation.break-page-breakThis same argument can be made in the Cash for Votes case. Someone offered BJP MPs some serious money to abstain from voting in Parliament. This would have helped the Government of the day survive. The MPs could have refused, the Government may have fallen but the legislators would have supressed information relating to a potential crime. Alternatively, the MPs could have gone to the local police, complained that they were being corrupted, set up a sting operation and nabbed the bribe givers. When a policeman hears that he is expected to nab the emissary of a major political party, someone who just may be in power next week, what do you think he is likely to do? Your third option is to turn whistle blower, take the money, take it to parliament and then tell the country what the ruling party is trying to do. As the law now stand, it seems if you do this, you can expect to enjoy some R&R in Tihar jail for your social service. Isn't there something wrong with a law like this?It obvious solution to this problem is to grant immunity to whistle blowers. At the height of the Anna hunger strike and its attending tamasha, I was as strident as anyone in drawing attention to the Governments effort to legislate an appropriate whistle blower law (see Melas with Missions). These two cases now reveal that my optimism was misplaced because the Public Interest Disclosure and Protection of Persons Making Disclosure Bill, 2010 would not help the whistle blower in either case. First, it applies only to central government employees, not to public servants generally and most certainly not to terrorists. This may not make much sense. Not everyone who puts the squeeze on you is a civil servant because he may well be the power of attorney holder of a civil servant. The agent who shows up to make a 'settlement' after the finalisation of your income tax returnhas been indefinitely delayed isn't a civil servant either.Second, this bill does not decriminalise bribe giving whistle blower. As often as not, to bribe and then squeal is your only option. If you do it and squeal, you're screwed. This seems to be a popular view. The Chief Economic Advisor to the Finance Ministry Kaushik Basu has recommended immunity for bribe givers. Infosys founder Narayana Murthy has endorsed this view. It seems to me that while this is a good idea, it is not enough because in the Cash for Votes case, the bribe takers were the whistle blowers! This takes us to the inescapable conclusion that it does not matter who is the taker and who is the giver: all we want is that in all cases, the whistle blower must receive immunity. You may wonder if this is going to lead to competitive squealing! Frankly, if we end up in a world where everyone is dying to squeal and no one wants to give or take a bribe, would you be complaining?This takes us to the third critical leg of the whistle blower stool: a witness protection program. Section 10 of the bill states that if a man fears victimisation, he can file an application before the Competent Authority! That is outrageously laughable but it is not funny at all. If you do not have an effective obligatory right-off-the-bat witness protection program, the only whistle blowers would be dead ones. How many Satyender Dubeys need to die before we figure this out?At the end of the day, it comes down to this: If you do not give complete immunity to the whistle blower, regardless of whether he is a giver, taker or just the facilitator, you are not going to get too many whistle blowers. If you do not give complete protection to the whistle blower, you are not going to get very many whistle blowers who will live long enough to finish the whistle blowing.The author is managing partner of the Gurgaon-based corporate law firm N South and author of the pioneering business book "Winning Legal Wars. He can be contacted at rcd@nsouthlaw.com
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Though year-to-date foreign institutional flows has been flattish, better FII flows can result in a good rebound, says I.V. Subramaniam, Director at Quantum AMC. 'Subbu' as he is popularly known among market fellow and friends, in his 20 years of fund management has been a conservative fund manager whose biggest regret and concerns for the market all these years has been lack of depth in the market in terms of having a more robust domestic institutional and retail clientele. Though he feels the solution to the European crisis will see a rebound in the near term, but a more benign inflation and interest rates scenario within India could act as a big trigger for the Indian equity markets.Talking to Businessworld''s Mahesh Nayak he strongly feels equity market returns can still give better returns than fixed income, with a caveat that investor may have to hold the security for more than a year. Excerpts from the conversation: Is this the worst period for the equity market that you have seen in the last 20 years of fund management? And why?I do not think it is the worst period for equity markets, but definitely the situation is grim. The scale of the problem is much larger and monetary institutions are weak in terms of the decisions they take. There have been periods of excesses in the past as well but this time there is a feeling that the monetary authorities in many countries are looking at quick fix solutions i.e. willing to print currency and assuming that this will solve all problems. And from a purely Indian stock market point of view, it cannot be the worst period. Our GDP is still growing at close to 7 per cent. India is not linked economically to the western world at the same level as some of the other emerging countries. Therefore any slowdown in the western world should not seriously impact India. However, from an equity perspective owing to capital flows share prices in the short run may be impacted by risk aversion of an FII. Inflation and high interest rates are not new to India. We had it in the past and managed it quite well. In fact I would say that our central bankers are probably the most skilled in terms of managing inflation. Taking all these factors into account, from an India perspective I do not think that this is the worst period. Now that we know about Euro-zone and the trouble in the west, how do you see global and Indian equity markets in the near-term to medium-term? (1-6 months)One to six months is too short a period to have a view for. Global investors face more headwinds. They are a nervous lot today and any un-anticipated bad news could lead to a sell off and a sharp decline in share prices. Year-to-date FII investment is slightly negative but the markets are down by 21 per cent. If they begin selling, then the decline could be worse. Having said that, with Indian rupee (INR) close to 52 to the dollar, there could be a strong reason for an FII to invest now if they expect the rupee to appreciate in the near term. What are your concerns for the equity market? Are we in a bear phase? And why?I am concerned about the lack of depth in the market in terms of having a more robust domestic institutional and retail clientele. Share prices are significantly influenced by FII flows. Although the savings rate in India is above 30 per cent, very little of that savings flows into equity markets. This to me is a big concern. The Indian investor has gained little in terms of returns from equity compared to an FII. I think we are in a bull phase, and see significant opportunities for attractive returns from investing in equities. We cannot avoid intermediate declines, but I would not call it a bear phase. When do you see the equity market rebounding from its lull? What will be the trigger and when do you see it coming?Better FII flows can result in a good rebound. Year-To-Date FII flows have been almost flattish. The trigger for rebounding could be a near term solution to the European crises. A more benign inflation and interest rates scenario within India could also act as a trigger. How has your interaction with Indian and global clients been? What are their concerns and what are you advising them?Clients in general have been concerned with the impact of high inflation and interest rates on GDP growth. Our view has been that inflation and high interest rates are not new to India. We had high interest rates in the 1990's and that did not stop India from growing at an average of 6 per cent. Our perspective is that inflation will come down to more normal levels going ahead. Some investors are also concerned with the policy freeze at the government decision making level. Again, our view is that if corruption led investigation brings about a change in the environment in which businesses operate and makes the entire system more transparent and clean, then that is a better situation to have. We are less concerned with the policy freeze situation. Do you see the equity market giving much better return than the fixed income return of 10 per cent in the next one year? And why?Assuming the Bloomberg consensus estimate of EPS Rs 1,324 for FY13 is correct, if we apply a multiple of 17 or 20, the sensex could be anywhere in the range of 22,500 to 26,500 by the middle of next year. This means a return of 33 per cent to 57 per cent. The market for a variety of reasons may choose to ignore the earnings in the short term and these returns may not come true. However, in the long run the markets cannot ignore these earnings. Historically the returns from investing in equity in India have seen a CAGR return of 17 per cent. Given the growth rate of 7 per cent in the GDP and an inflation of 6 per cent, earnings in India should normally grow by 13 per cent. If we are able to choose slightly better companies then the return, after taking into account dividend returns, should be in the range of 15 to 17 per cent. Also holding equity for the long term attracts zero capital gains tax, while a 10 per cent fixed income return will attract tax. In all equity returns can still give better returns than fixed income. However the investor may have to hold the security for more than a year. In times of uncertainty where will you advice investors to invest?Uncertainty can come from market conditions as well as personal situations. Where to invest will depend on an individual's financial goals as well as his risk appetite. The only universal investment rules that I can share are: Do not leverage, have adequate diversification, invest in products that you understand and quiz your financial advisor/distributor on why they are recommending certain products and what commissions do they get for recommending the same.Currently where are you investing your own money, and why? Are you a fan of equity at this juncture?Personally my money goes into our mutual fund (Quantum Long Term Equity fund) on a regular basis, and in case of sharp declines, I add more to my equity portfolio. My view is based on assumptions that I mentioned earlier on equity returns. Given my expectations on equity returns it would be foolish to not be a fan of equity markets. Having said that, equities by nature are volatile, and I am mentally ready for such volatility. As a fund manager how are you managing the money in your portfolio and where are you investing in this market?The cash in the portfolio is being used to buy and average down the cost of acquisition of certain stocks. Since the beginning of this year, we have been buying some stocks, particularly those pertaining to industries and those that have exposure to the power sector. Some of these stocks have seen a sharper decline since we invested in them largely due to near term negative sentiment i.e. investor worries about policy freeze, the weak finances of state electricity boards etc. However from a fundamental point of view, particularly when we look over longer time horizons, we find them attractive, hence we have been increasing our exposure to these stocks. Certain stocks in the consumption sector are still 15 per cent away from our buy limit. If they decline to our buy price, we will deploy cash in them as well.
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For a couple of months now, there have been rumours that the estranged Ambani siblings – Mukesh and Anil – were on the verge of some sort of rapprochement. There were stories that Mukesh Ambani might actually take up a stake or do business with some of the Anil Ambani companies. One story was that Mukesh would use the Anil Ambani managed Reliance Communication and its infrastructure for his own telecom rollout.Yesterday, the brothers came together in a highly publicised family gathering in Chorwad on the late Dhirubhai Ambani's 80th birth anniversary. The two families intermingled, and there was cheer and bonhomie all around.Observers are trying to figure out the implications of this sudden and highly publicised gathering of the clan. Some of the more optimistic ones talk about the two individual empires coming together once again and things going back to the old days where Mukesh was chairman and Anil was vice chairman of Reliance Industries Ltd. The more realistic ones talk about the two continuing to run individual empires, but utilising synergies and helping each other out with different things. The latter is scenario is the more probable one. For one, both the Ambani brothers have strong views on different businesses, and how they should be run. Just one small example: Mukesh was bullish on CDMA when he was running telecom in the undivided Reliance empire. In 2002, when telecom came to Anil after the empire was carved up, he promptly started pushing GSM into the spotlight. Later, Anil put big money on 3G spectrum. Mukesh chose to build his plans around broadband wireless. You could take any business and go on and on. It is more likely that the relations will be harmonious as long as they run separate companies.More importantly, the third generation of the Ambanis are also growing up. Mukesh has two sons and one daughter. Anil has two sons. In the future, the third generation would probably find it easier to maintain cordial relations as long as they did not have to share businesses. Few business houses have managed to stay together amicably in the third generation simply because the aspirations of the inheritors are often very different as are their personalities and their appetites for risk.At the same time, there are also some arguments in favour of the two Ambani brothers working in cooperation in at least some spheres, even if they do not go back to the pre-split days. For one, both brothers have learnt a lot in the years that followed the bitter split of 2002. Initially, both brothers rode high and both seemed to have inherited their father's Midas touch. The market capitalisation of their companies soared and it seemed that neither could put a foot wrong. But those were also the boom years of the global economy, and bold bets by both brothers were lapped up by the market.Over the past two years, both brothers have suffered some setbacks. In the case of Mukesh Ambani, his foray into retail did not create quite the impact that was expected from an Ambani venture. He also faced problems with the falling gas output, which caused some degree of conflict with the government.In the case of Anil, his telecom company accumulated enormous debt while his power ventures suffered many hiccups. But his finance companies and his entertainment ventures tasted good success.The experiences of the past few years may have made the brothers realise that working together – at least in some sectors and in limited ways – is more advantageous than opposing each other at all times. The author is the editor of Businessworld
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The world is spinning faster. Things are more connected and complex, more volatile and uncertain. The ability of a leader to always have ready-made answers is becoming a thing of the past. What leaders need most of all is the ability to learn and adapt quickly. At the Center for Creative Leadership (CCL), four decades of leadership development work with thousands of executives from around the world has led us to believe that learning agility is one of the most fundamental skills. That can seem odd. After all, haven't successful executives risen to where they are by virtue of their expertise and knowledge? Isn't it erroneous to say that these learned individuals need to learn-to-learn? The answer is that learning acquired in the past may not be what we need for the future. This is especially true as we rise and take on new roles in our organisations. Past competence doesn't translate into competence needed in the new role. And past learning itself may be a hindrance; if we think we know when we don't, and then we may be in trouble. In fact, an axiom of wisdom is recognising that the more you know, the more you know you don't know. So learning becomes a constant need and a core competence-learning new information, learning new ways, and learning new ways to learn. Old dogs sometimes don't learn new tricks because they need new ways to learn those tricks. So what are the ways we can learn? There are four primary ways: The first is learning through codified knowledge: books, classes, training and so on. This is most helpful when the answers are straightforward and textbook-like. It can be a limitation when the situation at hand is a mismatch for the knowledge we have - like trying to navigate through Delhi with a map from Mumbai. The second is through learning from others: mentors and coaches, teachers and preachers. We need people with whom we can dialogue to think through problems and make sense of situations. Good coaches and mentors do is not give answers but help us think about our challenges from different perspectives. Seeing a situation in a new light helps us devise more realistic and workable solutions. The third is learning by doing, through direct experience. We learn by trial and error. This practical path helps us to deal with extreme uncertainty, when nobody really has the answers. Small experiments based on intuition create clarity and learning. In our Lesson of Experience research studies, we find that leadership grows most from being in the crucible with tasks that we don't know how to do. We are forced to learn. The fourth is learning by reflection. We can be so busy "doing" that we don't often have enough time to quiet the mind and draw insights from the experiences we've had or what we may already know deep within ourselves. Techniques such as meditation, journaling, a warm bath, a quick nap, and jogging can help remove us from the bustle of our standard operating thoughts so as to think sideways, like Archimedes in his famous bathtub. These four learning styles match individual preferences. Each of us likes to learn in different ways; but learning the same lesson via multiple modes makes knowledge more clear and the learning sticky. Effective leadership programs bring all these modes together - to offer people fresh ideas, put them through experiential activities to draw out the lessons, provide time for classroom dialogue, and include journaling so each person can encode personal learning. What people can take away from these classroom experiences is not only learning but the practice of learning-to-learn. For instance, we are currently working with Grameen Foundation and CoCoon to build greater learning agility among microfinance middle managers in India and other countries in the region. These are individuals who are often young in age and tasked with great responsibility, complexity and change. Manuals are not feasible, since the codified knowledge in them would be dated as soon as the manual is developed; so it is important that the managers have the ability to learn quickly, using the different learning styles. Learning-to-learn comes from building the skills to tap others' expertise, the willingness to use challenges as learning opportunities, and the discipline to be reflective and self-aware. This need to create learning agility is important everywhere in the changing environment of India. Are we up to the task? Indians can be good at learning from books and learning on their feet. We can do better by finding more reflective time and seeking out others to be our mentors. We often are held back by the fear of looking incompetent. Yet, it is new challenges that allow us to learn and grow. And the better we can get at learning, the better we can take on new challenges. Lyndon Rego is the Global Director for the Center for Creative Leadership's Leadership Beyond Boundaries initiative, an effort to democratize leadership development internationally.
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Mobile wallet technology has once again become a hot topic in recent days, particularly around the potential security considerations related to these apps. The unavoidable truth is that whenever money is involved, mischief is sure to follow. This has probably been true since the dawn of currency.Symantec recently published a paper detailing our stance that the widespread adoption of mobile payment-type technology will likely trigger a surge of mobile malware and in turn mobile cybercrime. The reason is that these applications rely on devices to transmit financial information — such as mobile banking credentials — backed by real monetary funds. If we've learned anything from the PC cybercrime realm, it's just how lucrative the exploitation and sale of this kind of information can be for enterprising cyber criminals.Despite all this, the business case and user benefits of technology that transforms mobile devices into financial tools — perhaps what we can call mFinance — cannot and should not be ignored, either. This goes beyond mobile wallet apps and includes mobile banking, online purchases performed via mobile devices and a handful of other mobile activities that involve digital or hard currency. The fact of the matter is that the trend of using mobile devices as financial tools isn't going anywhere but upwards. According to a research report by Berg Insight, the worldwide number of mobile banking users is expected to reach 894 million by 2015. And the Yankee Group is expecting to see one trillion mobile payments by 2015.Thus, what the industry must do is figure out a better way to make sure that mFinance activities remain secure. There are many complexities involved in properly safeguarding devices against threats targeting mobile financial transactions. Once the transactions themselves are secured with proper encryption technology, mobile antimalware is a good next step. After all, malware is usually the backbone of the cybercrime arsenal. However, there is more that can be done.One approach that can be taken to improve both the security and usability of mobile apps that access sensitive financial information is embedding strong authentication directly into the apps. An example of this is what one of our customers – a large financial institution – did with their mobile banking app. By embedding Symantec authentication technology — Symantec Validation and ID Protection Service (VIP) — directly into their app, the financial institution's mobile banking customers' devices become a second form of authentication. Each time a user attempts to login to their account via the mobile app, a one-time passcode is automatically generated and validated on the authentication service's backend. All this is accomplished without the user having to do anything but enter a four digit PIN. Thus, this technology's ability to eliminate the need for users to enter in cumbersome user names and complex passwords every time they want to access their accounts thereby improves the user experience in addition to the bolstering the security of users' account.The widespread adoption of mFinance creates tremendous benefits and opportunities for end users, financial institutions, retail operators, carriers and third-party app developers. However, the industry needs to think outside the box in terms of security to make it a success. The same concept employed by the Symantec customer highlighted above can be implemented in a variety of different uses cases and serves as just one example of the unique strategies available to make mFinance secure and user friendly.The author is VP and MD, India Product Operations, Symantec
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The Bombay Stock Exchange (BSE) 30-share Sensitive Index (Sensex) rebounded this week to end with a gain of 1.6 per cent at 15738.7. The rally in the US and European markets also brought some festive cheer across Asian markets including India ahead of Christmas. The market gained after last week's sharp fall following bargain hunting by players that picked stocks at lower levels. News of food inflation slipping to a near four-year low at 1.81 per cent boosted marketmen's confidence as did reports that the government was looking at all options to attract foreign capital inflows. An upbeat report on the US housing market, coupled with an encouraging reading on German business sentiment and a well-received Spanish bond auction triggered the spike in risky assets, contributing to positive sentiment in the market.Though most of the Asian and global markets will be closed ahead of the new year, the Indian market could open positive on Monday following more than expected new homes sales in the US. On Friday, after the Indian market closed, US reported its sales of new homes. For the month of November, new homes sales rose to a seven-month high of 3.15 lakh, up 1.6 per cent, adding evidence of stabilization in the housing market. The news also helped lift the US market on Friday with the Dow Jones Industrial Average closing one per cent to close at 12,294.Next week, all eyes will on the Indian parliament. The Winter Session of parliament has been extended till December 29, 2011 to discuss crucial bills such as Lokpal bill, the whistleblower bill and judicial accountability bill. Any positive news from the government will act as a trigger for the Indian market.The Indian market can be expected to remain volatile ahead of the future & option expiry on Thursday on 29 December 2011. On the same day, the weekly inflation data will be reported in India, while the US will announce its initial jobless claim data. On Friday, the Indian government will also come out with the current account balance for third quarter.Any positive in the parliament would send the right signals to the market and investors — particularly foreign institutional investors (FIIs) — that the government is serious about reforms. So far the government has been struggling to pass crucial bills in parliament amid stiff resistance from Opposition and allies alike. Rising fiscal deficit has also added to the long list of concerns. In an environment of high inflation, the new food bill is expected to add a further burden of Rs 2 lakh crore per year to the exchequer. But even without the addition of Rs 2 lakh crore in food subsidies, the fiscal deficit at the end of FY12 is estimated to be at 5.6-5.7 per cent of the total GDP, compared to the government's earlier estimate of 4.6 per cent. If the food subsidy burden is considered for this year, than the fiscal deficit of India goes up to 7.5-7.7 per cent of GDP.All eyes are on the upcoming Uttar Pradesh elections and the union budget next year. One has to see whether the government gathers enough courage to implement important economic reforms.This week had started on a weak note following all-round pessimism among marketmen that pulled the Sensex down to its 28-month low on Tuesday. The market in the first two days of trade fell by 2 per cent with the Sensex touching a low of 15,135.86 in intra-day trades on Tuesday. However, it bounced back on Wednesday on reports that the government is looking at all options to attract foreign capital inflows. The finance ministry official said India can expect robust inflows of funds from FIIs in the long term and that current foreign fund outflows from India are temporary. Food inflation easing sharply to a near four-year low also raised hopes that easing inflation may prompt the Reserve Bank of India (RBI) to cut interest rates to revive sagging economic growth. During the week, the Sensex touched an intra-day high of 15,911.23 on Friday, before profit booking at higher levels pulled the index. But it still managed to end the week higher than last week at 15,738.7, up 247.35 points.It's not a runaway market as uncertainties surrounding the market aren't going away anywhere soon. Though liquidity easing in the Euro-zone and US may see some money coming to emerging market like India in the coming months, it will only be the developmental reform that will help our markets move upwards and that today seems to be in a limbo. Until India specific issues aren't adressed, particularly regarding opening of investment windows, equity can't be expected to witness a clear upsurge. But the triggers that the market is looking for would be clear signs that inflation is on the wane, signs of recovery in capital spending and consumer demand and third that the government has the resolve to see through critical reforms. Any combination of these would go a long way toward convincing investors that the fundamentals justify the type of premium valuation Indian markets have commanded in the last few years.There is really nothing that has changed today or in the last one year. What has changed is the perception among people. Experts feel this market is an absolute buying opportunity, and from a FII standpoint with rupee at 52 it's like picking stocks at a Nifty of 4000 levels. The reason for such confidence about the Indian market is due to the expectation of a strong corporate performance. Despite the dismal September ended quarterly performance as well as expectation that quarterly performance for the period ending December 2011 will be the worst in FY12, the expected earnings (EPS) for the Sensex for FY12, even after revising, is around Rs 1,131. This means the Sensex today at a forward price-to-earnings (P/E) ratio is trading close to 14 times. While for FY2013, on an estimated EPS growth of Rs 1277-1300, the Sensex P/E is trading around 12 times. It's true that today environment is surrounded by pessimism and fear and there is a high probability that the market may get into a panic mood which could further pull down the market. But it is also true – even the best of minds have never always been successful in finding the bottom. Instead of trying to guess or identify the point of maximum uncertainty, investors should start picking up frontline blue-chip stocks. When the tide turns these will be the first to rebound.
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