3 JUNE 2023 BW Businessworld

www.businessworld.in SUBSCRIBER’S COPY NOT FOR RESALE I RNI NO. 39847/81 I 03 JUNE 2023 INDIA’S BEST KEPT FMCG SECRET The Rs 72,000 crore Amul is betting on the non-dairy food segment to shore up its revenue to Rs 1 lakh crore Rs 150 JAYEN MEHTA, MD,Amul EXCLUSIVE INTERVIEW : Union Minister For Power and New & Renewable Energy R.K. Singh

www.businessworld.in RNI NO. 39847/81 I 03 JUNE 2023 EXCLUSIVE INTERVIEW: UNION MINISTER FOR POWER AND NEW & RENEWABLE ENERGY R.K. SINGH Consumer demand for summer solutions is on the rise and categories such as air conditioners & refrigerators are expecting positive momentum with high double-digit growth SUMMER KINGS The K.J. Jawa, Chairman & MD, Daikin India and (left) B. Thiagarajan, MD,Blue Star

6 | BW BUSINESSWORLD | 03 June 2023 Dear Reader, Verghese Kurien and the Operation Flood mission that he led, are milestones in India’s economic history. Operation Flood replicated the Anand Pattern of cooperative dairy farming across the country, turning a nation deficit in milk in the 1950s and 1960s, to the world’s largest milk producer. The Anand Pattern spearheaded a White Revolution and the ‘Amul’ brand soon became a household name. But where does Amul go from here? Our team travelled to the Milk Capital of India, Anand – home to the Gujarat Co-operative Milk Marketing Federation (GCMMF) or Amul – for a special report. With a group turnover of Rs 72,000 crore in FY2023, Amul now eyes a revenue of Rs 1 lakh crore by 2025. Jayen Mehta, Amul’s new managing director, sits down with Arjun Yadav and explains why the target is not daunting at all. With the dairy sector swiftly turning more organised and consumers becoming more health conscious by the day, the dairy industry could only grow, says Mehta. “Even if five per cent of Indians shift to packaged and branded milk, India can add one more Amul every year into the Indian market,” he tells us. Meanwhile, Ashish Sinha delves into the dynamics of India’s large milk economy and the government’s thrust on milk production for a second White Revolution. Mehta is confident that the era of cooperatives is back, inspired by Amul’s success. He anticipates that nearly a lakh new dairy cooperatives will emerge soon. But Mehta is not perturbed, but smiling, for the humungous cooperative he heads is at an inflection point. Amul is turning into an all-foods company, as has been evident in its vast array of new product launches in the non-dairy segment over the last three years. Mehta seems sanguine that the Amul brand will soon reflect in every item in the kitchens of Indian consumers. Incidentally, the company’s big FMCG makeover pits it against multinational giants like ITC, Nestle and Britannia. We look at Amul’s past attempts to diversify beyond dairy and value-added dairy products and how they failed to create a dent in the market. Will it be different this time? We will have to watch this space. We also talk to Union Minister for Power and New and Renewable Energy R.K. Singh, to take stock of how India prepares to address the rising demand for power – which Singh emphasises – was the surest indicator of a growing economy. With the Indian meteorological department predicting a hot and oppressive summer, we also talk to the country’s biggest air conditioner manufacturers. Kanwal Jeet Jawa of Daikin, Manish Sharma of Panasonic Life Solutions India and others share with us their plans to address consumer demand and their marketing playbook. Do read all our other exciting features and columns that you look forward to. Happy Reading! ANNURAG BATRA [email protected] AMUL’S INFLECTION POINT EDITOR-IN-CHIEF’S NOTE

www.bmlmunjalawards.com To apply for awards, please visit Last date: June 9, 2023 "It is my firm belief that the BML Munjal Awards would enable the corporate world to share their best practices in skill endowment and human resource development with young entrepreneurs and motivate them to achieve their full potential." Shri Jagdeep Dhankhar Vice President of India at 16th BML Munjal Awards Scan to access Best Practices of 16th BML Munjal Awards KNOWLEDGE PARTNER SUPPORTING PARTNER ASSOCIATE PARTNERS For queries, please write to: [email protected]

8 | B W BUSINESSWORLD | 03 June 2023 BW Businessworld does not accept responsibility for returning unsolicited manuscripts and photographs. All unsolicited material should be accompanied by self-addressed envelopes and sufficient postage. Published and printed by Annurag Batra for and on behalf of the owners, BW Businessworld Media Private Limited. Published at 74-75, Scindia House, Connaught Place, New Delhi-110001, and printed at Infinity Advertising Services Private Limited. Editor : Annurag Batra. © Reproduction in whole or in part without written permission of the publisher is prohibited. All rights reserved. R.N.I.No. 39847/81 BW Businessworld Media Private Limited EDITORIAL OFFICES BW Businessworld Media Pvt. Ltd. 74-75, Scindia House, Connaught Place, New Delhi-110001 Phone: 9818063325 ADVERTISEMENT/CIRCULATION / SUBSCRIPTION ENQUIRIES BW Businessworld Media Pvt. Ltd. 74-75, Scindia House, Connaught Place, New Delhi-110001 Phone: 9818063325 SUBSCRIPTION SERVICE Vinod Kumar +91 9810961195, [email protected], [email protected] Subscription rates: ONE YEAR - Rs 2,899 TWO YEARS - Rs 5,599 THREE YEARS - Rs 8,199 HUMAN RESOURCES: Namrata Tripathi ([email protected]) LEGAL ADVISOR: Sudhir Mishra (Trust Legal) GROUP CHAIRMAN & EDITOR-IN-CHIEF: Dr. ANNURAG BATRA CEO, BW COMMUNITIES Bhuvanesh Khanna CEO & CHIEF INNOVATION OFFICER Hoshie Ghaswalla (CEO-BW Engage) GROUP EDITORIAL DIRECTOR Noor Fathima Warsia EXECUTIVE EDITOR: Suman K. Jha EDITORIAL TEAM Sr. Associate Editors: Ashish Sinha, Jyotsna Sharma, Meha Mathur Assistant Editor:Tarannum Manjul Sr. Correspondents: Rohit Chintapali, Deep Majumdar Correspondents: Abhishek Sharma, Arjun Yadav Jr. Correspondent: Chandril Chattopadhyay DESK TEAM Deputy Editor: Mukul Rai Associate Editors: Madhumita Chakraborty; Smita Kulshreshth ART TEAM Art Directors: Dinesh Banduni, Shiv Kumar, Shivaji Sengupta Assistant Art Director: Rajinder Kumar Infographics & Data Visualiser: Arun Kumar Assistant Images Editor: Sanjay Jakhmola PHOTO TEAM Sr. Photo Researcher: Kamal Kumar BW ONLINE: Assistant Editor: Poonam Singh VIDEO EDITORIAL TEAM Video Team: Anurag Giri Pappu Kumar Singh Sunny Kumar Paswan Sr. Cameraperson: Ratneshwar Kumar Singh BW APPLAUSE & EVERYTHING EXPERIENTIAL: Ruhail Amin BW AUTO WORLD: Utkarsh Agarwal BW DISRUPT: Resham Suhail BW EDUCATION: Upasana BW HEALTHCARE WORLD: Smridhi Sharma, Shivam Tyagi BW HOTELIER: Editor: Saurabh Tankha Editorial Lead: Bulbul Dhawan Operations Controller: Ajith Kumar LR BW MARKETING WORLD: Soumya Sehgal, Reema Bhaduri BW PEOPLE: Sugandh Bahl, Krishnendra Joshi BW LEGAL WORLD: Kaustubh Mehta BW WELLBEING: Kavi Bhandari VC WORLD: Anisha Aditya BW SECURITY WORLD: Shilpa Chandel BW POLICE WORLD: Ujjawala Nayudu DIRECTOR: Prasar Sharma GROUP SR. VICE PRESIDENT - STRATEGY, OPERATIONS & MARKETING Tanvie Ahuja ([email protected]) CEO, BW HEALTHCARE WORLD & BW WELLBEING WORLD: Harbinder Narula DIRECTOR, ADVERTISING & REVENUE: Aparna Sengupta DIRECTOR, PROJECTS & COMMUNITIES: Talees Rizvi VICE PRESIDENT: Mohit Chopra VICE PRESIDENT STRATEGIC PROJECTS: Uday Laroia MARKETING & DESIGN TEAM: Kartikay Koomar, Mohd. Salman Ali, Moksha Khimasiya, Shweta Boyal, Alka Rawat, Arti Chhipa, Mradul Dwivedi Asst. Manager - Design: Kuldeep Kumar EVENTS TEAM: Tarun Ahuja, Devika Kundu Sengupta, Preksha Jain, Akash Kumar Pandey, Mohd. Arshad Reza, Sneha Sinha, Ashish Kumar, Nandni Sharma, Mahek Surti, Reeti Gupta, Atul Joshi, Mir Salika, Biren Singho, Abhishek Verma, Neeraj Verma, Sushmita Kumari, Prashant Kumar, Mayank Kumar SALES TEAM NORTH: Ravi Khatri, Anjeet Trivedi, Rajeev Chauhan, Amit Bhasin, Somyajit Sengupta, Priyanshi Khandelwal, Sajjad Mohammad WEST: Kiran Dedhia, Nilesh Argekar SOUTH: C S Rajaraman BW COMMUNITIES BUSINESS LEADS Priya Saraf (BW Education), Gareema Ahuja (BW Legal World), Chetan Mehra (BW Disrupt), Shruti Arora (BW Marketing World) CIRCULATION TEAM General Manager - Circulation, Subscription & Sales: Vinod Kumar ([email protected]) NORTH-EAST: Shiv Singh, Mukhtadir Malik, Kamlesh Prasad WEST: Gorakshanath Sanap SOUTH: Sarvothama Nayak K FINANCE TEAM Ankit Kumar, Ishwar Sharma, Shrikant Sharma, Vijay Jangra IT SUPPORT: Brijender Wahal ADMIN SUPPORT: Assistant to Chairman & Editor-in-Chief: Aman Mishra ([email protected]) VOL. 42, ISSUE 16 03 JUNE 2023

10 | B W BUSINESSWORLD | 03 June 2023 MAILBOX YOUR COMMENTS TALK BACK TARUN KHANNA: ENTREPRENEURSHIP AND A STATE OF MIND www.businessworld.in RNI NO. 39847/81 I 20 MAY 2023 INDIA’S HOTTEST YOUNG ENTREPRENEURS Rs 150 { { (L-R) Top row: Divij Bajaj, Kishan Karunakumar, Pallavi Shrivastava, Ankit Fatehpuria, Shobit Rai. Middle row: Sandeep Devgan, Parul Sharma, Ajay Lakhotia, Aakriti Rawal, Kartik Hajela, Saurabh Kumar Agarwal. Bottom row: Pranav Bajaj, Bharat Bansal, Vivek Singh, Preet Pal Thakur Columns by Gurus of Entreprenuership FOCUS ON COLLABORATION This refers to the editorial (“Because Relationships Matter”, BW, May 20). The author points out that Reshamandi, a natural fibre supply chain startup, has registered three times revenue at Rs 1,248 crore in the first three quarters of FY23. According to Co-founder and CTO Saurabh Kumar Agarwal, a re-look at the product mix, margins, efficient use of capital and human resources and the like has helped Reshamandi bring profitability and growth to the business. It is indeed heartening to know that the company has strengthened its relationships by building more trust with their teams, employees and stakeholders. Also, Reshamandi is open to collaborating with the right set of people and organisations that share its desire to make a difference. AMITA BANSAL, EMAIL SUSTAINABILITY AS AN OUTPUT This refers to the editorial (“A Planet-first Approach”, BW, May 20). It is good to know that Log9 Materials, a startup that is taking a planet-first approach, has been incorporating planet-conscious steps into its operations. It is an example of how a brand can achieve its target while keeping the planet as its centre. Kartik Hajela, Co-founder and COO of Log9 Materials shares that the company has been very thoughtful of their expenditure, making sure whatever they do has a high-value upside towards sustainability and towards their business. As a result, Log9 raised $40 million in a mix of equity and debt in January. Moreover, it recorded a fourfold jump in revenue. Well, sustainability as an output is not just an option but the future of businesses, and Log9 has realised the part it has to play in the battle to save the planet. VIKRANT PLAWAT, EMAIL BLIPP THIS PAGE TO GIVE US YOUR FEEDBACK INSTANTLY Submissions to BW |Businessworld should include the writer’s name and address and be sent by email to the editor at [email protected] or by mail to 74-75, Scindia House, Connaught Place, New Delhi-110001

RAHUL SINGH VP & Head of Marketing SAP India SHUBHRANSHU SINGH Vice President, Marketing, Domestic & IB, Tata Motors DR. ANNURAG BATRA Chairman & Editor-in-Chief BW Businessworld & Founder, exchange4media NOOR FATHIMA WARSIA Group Editorial Director BW Businessworld GAURAV MEHTA CMO Noise DEEPALI NAAIR Group CMO CK Birla Group AMIT DOSHI CMO Britannia CHARU KISHNANI Executive Vice President Marketing, CarDekho Group MANISH SINHA CMO Sterlite Technologies RAJAT ABBI Vice President – Global Marketing India, Chief Marketing Oficer – Greater India, Schneider Electric JYOTI KUMAR BANSAL Chief Branding, Communication, CSR, Sustainability, Tata Power ARVIND R.P CMO McDonald's India SAI NARAYAN CMO Policybazaar.com AJAY KAKAR Brand & Marketing Strategist ARVIND SAXENA Sr. GM & Head - Marketing & Corporate Communications, NEC Corporation India JURY MEMBERS #BWMarketing40under40 JULY 2023 NOMINATE NOW Mir Salika: +91 85270 48483, [email protected] Chetan Mehra: +91 98117 02464, [email protected] For Nominations: Aparna Sengupta: +91 99580 00128, [email protected] Ravi Khatri: +91 98913 15715, [email protected] Somyajit Sengupta: +91 98182 47444, [email protected] Kiran Dedhia: +91 98333 99009, [email protected] CS Rajaraman: +91 93422 62859, [email protected] For Sponsorship:

12 | BW BUSINESSWORLD | 03 June 2023 Cover design by DINESH S. BANDUNI Cover photograph by RITESH SHARMA An FMCG Powerhouse In The Making How Amul is seeking to capture a larger share in India’s growing organised dairy sector while making the non-dairyfood segment a key growth driver 56 14 Jottings Fresh funding to end BYJU’s woes?; Meghwal gets Law; Fleeing subscribers; AI and Job Losses 20 Columns Minhaz Merchant (p. 20); Vikas Singh (p. 22); Srinath Sridharan & Steve Correa (p. 24); Amit Kapoor & Amitabh Kant (p. 26); Krishan Kalra (p. 28); Anu Sehgal (p. 30); Kaivalya Vohra (p. 32); Kiran Karnik (p. 34); Srinath Sridharan (p. 36); Noor Fathima Warsia (p. 40) 42 Calling Mayday How the Wadia Group promoted Go First airline’s decion to file a plea for voluntary insolvency proceedings with the National Company Law Tribunal has upset the lessers and creditors who are so critical to the health of the aviation industry CONTENTS VOLUME 42, ISSUE 16 03 JUNE 2023 Photograph by Ritesh Sharma

03 June 2023 | B W BUSINESSWORLD | 13 The pages in BW Businessworld that are labelled BWi or Promotions contain sponsored content. They are entirely generated by an advertiser or the marketing department of BW Businessworld. Also, the inserts being distributed along with some copies of the magazine are advertorials /advertisements. These pages should not be confused with BW Businessworld’s editorial content. TOTAL NO. OF PAGES INCLUDING COVER 110 48 In Conversation Marico’s Harsh Mariwala on innovative business practices that have powered the company’s growth and other life lessons 52 Interview Puneet Chandok of AWS India on certain contemporary themes in cloud computing, the macroeconomic uncertainty around the world and how it will impact cloud spending 66 Milking Growth How India’s goal of commanding one-third of the global milk output in the next 10 years will need a lot of work by the government and industry alike 72 Great Summer Sale How a severe summer may actually turn out to be a bonanza for the cooling industry by sharply spurring the demand for ACs, referigerators and other durables 76 Ministerspeak R.K. Singh, Union Minister for Power and New & Renewable on the government’s preparation to address the all-time high power demand this summer and the country’s energy transition drive 80 Daikin’s Summer Plan K.J. Jawa, Chairman & MD, Daikin India on the company’s plans for summer with early consumer demand and AC’s role as a productivity enhancer 104 Sustainable Design How sustainable architecture is gaining popularity among consumers and why it is important for them to understand the practicalities of developing sustainable buildings in India 100 World of Art A close look at the growing Indian art market and how it is seeing the emergence of collectors who are keen to add to their collections as a way to diversify their investment portfolios 108 Last Word Tiger Tyagarajan, President and CEO, Genpact on things business leaders should be concentrating on to navigate the current economic challenges Photograph courtesy: India Art Fair

14 | BW BUSINESSWORLD | 03 June 2023 JOTTINGS THE DOMESTIC TELECOM space is silently undergoing changes when it comes to subscriber affiliation to a particular service provider. Will the three-player market give way to two dominant telecom service providers very soon? At least the numbers released by the telecom sector regulator indicate as much. In February 2023, Vodafone Idea (Vi) faced continued challenges as it struggled to compete effectively A SERIES OF n o t - s o - g o o d developments at BYJU’s – such as large-scale firing, major vendor dues and a probe by the Enforcement Directorate in April – has kept the EdTech giant in headlines for all the wrong reasons. Meanwhile, in the second week of May BYJU’s raised $250 million in debt funding from US-based investment firm Davidson Kempner at the current flat valuation of $22 billion. BYJU’s is already close to securing an additional $700 million as a part of its $1 billion round of funding. The funding comes at a time when BYJU’s is exploring the possibility of going public with its tutorial chain, Aakash Educational Services. According to media reports in April 2023, US-based asset manager BlackRock, which owns less than one per cent stake in the company, marked down BYJU’s valuation by nearly 50 per cent to $11.5 billion. In FY2021, the company had incurred a massive drop in revenue and saw its losses widen to Rs 4,598 crore from Rs 232 crore. The CEO, Byju Raveendran, seems bullish about raising fresh capital, which will eventually decide where the EdTech decacorn is headed this fiscal. —Resham Suhail Meghwal Gets Law E IN A RATHER surprise reshuffle of the Modi Cabinet, Union Law Minister Kiren Rijiju was replaced by Arjun Ram Meghwal on 18 May. Meghwal takes charge as a minister of state with independent charge. Rijiju moves to the Union ministry of Earth Sciences. The word in the corridors of power is that the decision reflects the Prime Minister’s reviewing of the performances of his ministers and some of Rijiju’s controversial statements about the judicial system, have not gone down well with senior leaders of the Bharatiya Janata Party (BJP). The decision, however, also comes on the eve of the 2024 Lok Sabha elections. Meghwal hails from Rajasthan and is a popular Dalit face there. His new stature strengthens the BJP’s vote bank not just in Rajasthan, but among Dalit voters across north India. Rajasthan is already on the brink of Assembly polls and the party would naturally like to come back to power in the state. — Tarannum Manjul FLEEING SUBSCRIBERS Photograph by Ritesh Sharma FRESH FUNDING TO END BYJU’S WOES? with its competitors, Reliance Jio and Bharti Airtel. Vi experienced a loss of two million subscribers during the second month of the current calendar, while Jio gained a little over a million subscribers and Airtel added 9,82,554 subscribers. These figures were revealed in the latest subscriber data released by the Telecom Regulatory Authority of India (TRAI). Vi’s total consumer base at February end stood at 237.9 million, significantly lower than Airtel’s base of 369.8 million and Jio’s base of 427.1 million. As a result, Vi’s market share further decreased to 20.84 per cent in February, down from 20.99 per cent the previous month. Airtel and Jio both gained market share at Vi’s expense, with Airtel’s share up at 32.39 per cent and Jio’s at 37.41 per cent. —Ashish Sinha Photograph by Imtmphoto 03 June 2023 | BW BUSINESSWORLD | 15 INDIAN WOMEN PREFER REAL ESTATE OVER GOLD FOR INVESTMENT, CONSIDER IT IDEAL FOR CURRENT TIMES I NVESTMENT of any type is very important for good returns and a secure future. It can be of any kind, from SIPs, gold, direct stocks, real estate or even government securities. Out of all these options, a house as an asset could function as a financial safety net, an income source, or even a long-term investment which is an essential step towards financial independence and empowerment. Taking that into consideration, today’s modernday woman is more bullish towards real estate as an asset class compared to other investment options. Historically, real estate has been a male-dominated industry, but more and more women are subscribing to the benefits of investing in property. To begin with, women get a concession on the interest rate on home loans. This concession can range from 0.05% to 0.1%. Although this may seem insignificant, it adds up to a lot since home loans in India can last 15 to 25 years. When it comes to stamp duty, women also get a reduction of 1% to 2% in stamp duty in some states. This is based on the government’s initiative to encourage women to own property. The Maharashtra Government, in their budget for 2023-24, offered one per cent discount in stamp duty for women homebuyers. This move is expected to make home-buying cheaper for women in the state, thereby significantly increasing demand. Other government policies in India promote women’s homeownership, too. For instance, the Pradhan Mantri Awas Yojana (PMAY) mandates that homes must be registered in a woman’s name or with a woman as co-owner to qualify for the program. This initiative aims to empower women from the lower-income segments of society. According to a report by ANAROCK, women accounted for 30–35% of homebuyers in the country in 2019, and that figure would only continue to go up in the years to come. Another recent ANAROCK survey shows that 65% of women prefer investing in real estate over gold or stocks. Despite global recessionary pressures and financial markets still seeing some sluggishness worldwide after the pandemic, the Indian real estate sector has continued to witness robust growth, and one of the main reasons has been the increase in women’s ownership of real estate. MANJU YAGNIK Vice Chairperson, Nahar Group

FRET NOT, ZERODHA CEO TELLS STAFF FEARS AROUND AI-INDUCED job losses are only being compounded by an enormous number of layoffs worldwide, as businesses streamline their teams to face market uncertainties. In a recent Bloomberg interview, IBM CEO Arvind Krishna said he could “easily see” nearly a third of the company’s non-customerfacing roles being replaced over the next five years. Amid such doom-and-gloom, Zerodha has introduced an internal AI policy to give its workforce much-needed clarity on AI and the tech-induced job anxiety. Zerodha CEO Nithin Kamath made it clear that no employee would be fired because of implementation of any new technology, including AI. “Many companies will likely let go of employees and blame it on AI. In the process, companies will earn more and make their shareholders wealthier, worsening wealth inequality. This isn’t a good outcome for humanity,” said Kamath in his LinkedIn post. In the third week of May, social media platform for professionals, LinkedIn, also announced plans to lay off over 700 employees. It joined the ranks of large companies such as Google, Microsoft, Twitter, Meta, Amazon and many more, by announcing its plans around job cuts. According to a report by Challenger, Gray & Christmas, Inc., the US technology sector alone has announced over 100,000 layoffs in the first quarter of the 2023 calendar year. — Rohit Chintapali 03 June 2023 | B W BUSINESSWORLD | 15 INDIAN WOMEN PREFER REAL ESTATE OVER GOLD FOR INVESTMENT, CONSIDER IT IDEAL FOR CURRENT TIMES I NVESTMENT of any type is very important for good returns and a secure future. It can be of any kind, from SIPs, gold, direct stocks, real estate or even government securities. Out of all these options, a house as an asset could function as a financial safety net, an income source, or even a long-term investment which is an essential step towards financial independence and empowerment. Taking that into consideration, today’s modernday woman is more bullish towards real estate as an asset class compared to other investment options. Historically, real estate has been a male-dominated industry, but more and more women are subscribing to the benefits of investing in property. To begin with, women get a concession on the interest rate on home loans. This concession can range from 0.05% to 0.1%. Although this may seem insignificant, it adds up to a lot since home loans in India can last 15 to 25 years. When it comes to stamp duty, women also get a reduction of 1% to 2% in stamp duty in some states. This is based on the government’s initiative to encourage women to own property. The Maharashtra Government, in their budget for 2023-24, offered one per cent discount in stamp duty for women homebuyers. This move is expected to make home-buying cheaper for women in the state, thereby significantly increasing demand. Other government policies in India promote women’s homeownership, too. For instance, the Pradhan Mantri Awas Yojana (PMAY) mandates that homes must be registered in a woman’s name or with a woman as co-owner to qualify for the program. This initiative aims to empower women from the lower-income segments of society. According to a report by ANAROCK, women accounted for 30–35% of homebuyers in the country in 2019, and that figure would only continue to go up in the years to come. Another recent ANAROCK survey shows that 65% of women prefer investing in real estate over gold or stocks. Despite global recessionary pressures and financial markets still seeing some sluggishness worldwide after the pandemic, the Indian real estate sector has continued to witness robust growth, and one of the main reasons has been the increase in women’s ownership of real estate. MANJU YAGNIK Vice Chairperson, Nahar Group

16 | B W BUSINESSWORLD | 03 June 2023 Chhattisgarh Touching New Heights Of Development Led by Chief Minister Bhupesh Baghel, the tribal dominated state has touched new heights of development for every sector SPOTLIGHT: CHHATTISGARH Bhupesh Baghel Chief Minister, Chhattisgarh hhattisgarh has grown significantly in terms of growth and development over the last four years. The Chhattisgarh Government has launched a number of public welfare programmes that have drastically improved the lives of people in the state under the inspirational leadership of Chief Minister Bhupesh Baghel. Gadhbo Nava Chhattisgarh is the state’s motto, and this year the chief minister unveiled a “Bharose ka Budget” that is intended to promote wealth and growth in the region. Recently, the Chhattisgarh government, headed by Chief Minister Bhupesh Baghel, completed its fourth year in office. The Chhattisgarh Chief Minister has been actively working to improve the state’s populace, particularly the rural poor, tribals, and C farmers, ever since taking office. The SC/ST, OBC, and destitute people in the state are all given more influence thanks to a framework that the Chhattisgarh government put in place. The State Government implemented a public welfare paradigm where each programme or scheme benefits every person. Decisions were taken to make natural resources and traditional crafts into sources of income for those living in rural and forested areas. A framework for policy development that supports small businesses was created while simultaneously addressing the concerns of micro, small, and medium-sized businesses. Through decisions like the improvement of paddy procurement price, ‘tendu patta’ collection rates, and many other initiatives, the State Government has been successful in elevating the ruralbased mainstream economy of the state to the forefront. The government’s flagship schemes, like Narva Garva Ghuruva Bari, focus on utilising the “Gauthan” (cowshed) to improve the rural economy. Under the Rajiv Gandhi Kisan NYAY Yojana, the State Government has provided farmers with financial assistance in

03 June 2023 | B W BUSINESSWORLD | 17 erinary Hospital in the Raipur district’s Datrenga village. From the following year, the monetary support provided under the “Rajiv Gandhi Bhoomihin Krishi Majdur NYAY Yojana” will increase from Rs 6,000 to Rs 7,000 annually. To ensure that farmers have access to high-quality chemical and organic fertilisers, the Chhattisgarh government has plans to build new facilities for fertiliser quality control in the districts of Rajnandgaon and Raigarh. In Raipur, a new pesticide laboratory is being built to test the efficacy of chemical and organic pesticides. In order to employ cutting-edge horticulture techniques, an allocation of Rs 2.51 crore has been earmarked for the establishment of a Centre of Excellence in Nava Raipur. Additionally, the pay for Anganwadi helpers has increased from Rs 3,500 to Rs 5,000 per month, and the pay for Mini Anganwadi employees has increased from Rs 4,500 to Rs 7,500 per month. Cooks who prepare lunch for students as part of the midday meal programme in schools now receive an honorarium of Rs 1,800 per month instead of Rs 1,500, while sanitation workers now receive an honorarium of Rs 2,800 per month instead of Rs 2,500. The impoverished will receive greater cash thanks to these actions. order to support cultivators. The CM recently released the yearly budget for fiscal 2023–2024 while announcing a pro–poor budget. The budget would enhance the ‘Chhattisgarh Model’ goals by placing a focus on agriculture and the rural economy, raising the standard of living for the general populace. In his budget speech, Baghel emphasised the importance of rural development, noting that the Pradhan Mantri Awas Yojana (Gramin) has been allocated Rs 3,238 crore, while Rs 500 crore has been set aside for the upkeep of roads built under the Pradhan Mantri Gram Sadak Yojana and the Mukhyamantri Gram Sadak Yojana. The education sector has received particular attention from the State Government. A budget of Rs 400 crore has been set aside for the CHALK project, which is supported by the World Bank, while Rs 19,489 crore has been designated for school education. Also allocated for the Mukhyamantri School Jatan Yojana is Rs 500 crore. A further Rs 1 crore has been allocated for teacher training institute. The monthly scholarship amount for SC, ST, and OBC students attending hostels, ashrams, and Prayas schools has also been Chief Minister BHUPESH BAGHEL has disbursed Rs 1.5 lakh crore to more than 26,68,000 farmers, landless agricultural labourers, livestock farmers and women self-help groups associated with Gauthan increased by the Chhattisgarh government from Rs 1,000 to Rs 1,500. Post-matric hostel students are now eligible for a monthly allocation of Rs 1200 instead of Rs 700 under the food assistance scheme. In addition to investing Rs 1,000 crores for various infrastructure construction projects in metropolitan areas, the State Government has enhanced the monthly pension amount under the social security pension system for widows, abandoned women, and the old and crippled to Rs 500. Additionally, Rs 2.18 crore has been set aside for the construction of the State Animal Shelter Home and Vet-

18 | B W BUSINESSWORLD | 03 June 2023 Boosting Agri-Economy With the intention of rescuing farmers from debt, enhancing their economic situation, and turning farming into a successful business, the Rajiv Gandhi Kisan Nyay Yojana was started in Chhattisgarh. The state government is providing input support under the programme at a rate of Rs 9,000 per acre for kharif and horticulture crops. Meanwhile, the amount of Rs 10,000 has been marked for crops like sugarcane, kodo kutki, maize, arhar, soyabean, pulses, papaya or oil seeds. This incentive will be available to those farmers who have been producing crops for three years. Chhattisgarh farmers are now more motivated to focus on their crops and strive for a higher output thanks to this programme. The “Rajiv Gandhi Kisan Nyay Yojana” is now in its fourth year, and the farmers have received roughly Rs 22,679 crore so far. The Chhattisgarh government initiated it with the intention of boosting crop yield in the state on 21 May 2020, the death anniversary of the late prime minister Rajiv Gandhi. As part of this programme, the Chhattisgarh government remitted Rs 18,208 crores as agricultural input subsidies to the bank accounts of roughly 23.23 lakh farmers. The CM Bhupesh Baghel also made a number of significant moves in the past four years that have benefited farmers. Notably, the Chhattisgarh government decided to give farmers who sold paddy at a support price in the years 2020–21 an input subsidy of 10,000 rupees per acre rather than 9,000 rupees per acre if they are growing kodo kutki, sugarcane, pigeon pea, maize, soybean, pulses, oilseeds, aromatic paddy, fortified paddy crop or planting trees at the paddy field. This incentive will be available to farmers for three years as they produce crops in their paddy fields. the state’s unemployed youth. The government has designated Rs250 crore for this purpose in an effort to empower youth and give them muchneeded financial support. The state administration has formally announced that unemployed youth who have completed grade 12 would be eligible for this monthly payment. Additionally, this programme will only be open to educated youth SPOTLIGHT: CHHATTISGARH Monthly Allowance For Unemployed Youth Educated unemployed youth with a family income of less than Rs 2.5 lakhs per year are eligible for the monthly allowance programme. The Bhupesh Baghel-led Chhattisgarh Government recently announced a monthly payment of Rs2,500 as a part of its Budget 2023–24 in a ground-breaking attempt to elevate

03 June 2023 | B W BUSINESSWORLD | 19 whose family income is less than Rs. 2.5 lakhs annually. It’s important to note that only one family member may apply for this programme. This forward-thinking project demonstrates the government’s dedication to expanding employment possibilities and helping the state’s youngsters. The youth of Chhattisgarh who are unemployed may pursue their aspirations without worrying about money thanks to this monthly allowance, and they will ultimately help the state grow and prosper.There will be the introduction of a new programme to provide unemployment benefits. In accordance with the programme, unemployed individuals between the ages of 18 and 35 who have completed grade 12 and have a family income under Rs 2.50 lakh would receive a monthly allowance of Rs. 2,500, according to Chief Minister Bhupesh Baghel, who also holds the portfolio for finance. According to the notification, the state government will continue the monthly allowance for young people who are unable to find employment a year after receiving it. Additionally, individuals who have turned down a job offer from the public or private sector will not be qualified for the allowance. In a tweet, Chief Minister Bhupesh Baghel stated that applications tisgarh,” carefully assessed the issues faced by domestic customers and did so with the utmost empathy. As a result, the state government began implementing the “Half Bijli Bill Yojana” on March 1 for all home consumers in the state. Domestic customers now get a 50% discount on their first 400 units of power used. Additionally, the Ekal Batti Connection Yojana offers 30 free electricity units per month to low-income families. The state’s citizens, notably those from the lower middle class and middle class groups, have benefited greatly from the programme. 42 lakh home consumers have directly benefited from the programme, according to the Power Department. In fact, Chhattisgarh has saved 3,250 crore over the last four years. Mukhyamantri Haat Bazaar Clinic Yojana The state government has launched the ‘Mukhyamantri Haat Bazar Clinic Yojana’ to provide patients with basic health treatments in a swift and efficient manner. Patients can now receive prompt medical assessment and treatment Previously, patients had to travel long distances to urban areas to get a simple blood test done due to a lack of pathology facilities in rural and urban slum regions. Today, blood tests are conducted free of cost at Haat Bazar clinics to identify high blood pressure, diabetes, sickle cell disease, anaemia, haemoglobin, malaria, and typhoid. This means that people can receive prompt treatment in the event of an illness. submitted on any day in April will be accepted starting on April 1 for the purpose of granting the allowance. The applicant must be registered with a District Employment and Self-Employment Guidance Centres in Chhattisgarh in order to be eligible. Additionally, as of April 1 of the application year, the applicant’s employment registration had to have been active for at least two years in order for them to qualify for the allowance. Half Bijli Bill Yojana 42 lakh domestic consumers are made happy with the implementation of the ‘Half Bijli Bill Yojana’, which was implemented by the Chhattisgarh government after it realised the actual power and significance of energy. Up to 400 units of home electricity consumption are covered by the plan’s provision for payment of half of the electricity bills. Bhupesh Baghel, the chief minister of Chhattisgarh under the banner of “Gadhbo Nava Chhat-

20 | B W BUSINESSWORLD | 03 June 2023 OW MANY COUNTRIES export goods and services every year valued at more than $1 trillion? Just three: China ($3.55 trillion), the United States ($2.53 trillion) and Germany ($2.03 trillion). These are the latest World Bank figures for calendar 2021. The numbers for 2022 are due soon but unlikely to be much higher owing to trade disruptions caused by the Russia-Ukraine war. Japan, South Korea, Singapore, the Netherlands and Hong Kong are big exporters too, but below the $1 trillion mark. Where does India stand? Driven by surging services exports, India’s total exports of goods and services in 2022-23 was $775 billion. Of this, merchandise exports were $450 billion and services exports $325 billion. While merchandise export growth has softened, services exports continue to rise. The projection of total exports for 2023-24 is $850-$900 billion. If that holds good, and overall export growth remains strong at 15 per cent, India could by 2024- 25 become the fourth country in the world to join China, the US and Germany in the trillion-dollar export club. While trade disruptions and sanctions continue to pose a challenge to India’s export growth, several other factors have turned favourable. Apple’s decision to make India an export hub for iPhones will lead to 25 per cent of all iPhones being manufactured in India by 2025-26. The total global sales revenue of iPhones in calendar 2022 was $201 billion. India is set to account for a quarter of that – over $50 billion. The majority will be exported. Hyundai and Maruti Suzuki have similar plans to turn India into an automotive export hub. Meanwhile services exports are set to receive a further boost from the partial opening up of legal services to foreign firms and international lawyers on a reciprocal basis. But the larger potential lies in Global Capability Centres (GCC) set up by multinational corporations. The export potential through 1,700 GCCs currently operational in India, employing 1.7 million people, is significant. According to analyticsindiamag.com, “India accounts for 45 per cent of GCCs in the world. Last year, Goldman Sachs said it would hire around 2,500 people by 2023 to expand its operations in Hyderabad. Over the years, the centre has become one of the largest technology hubs globally, with about 7,000+ professionals. The investment bank launched the Hyderabad centre to drive engineering and business innovation in India. Pharmaceutical giant GSK has set up its GCC in Bengaluru. The GCC team currently focuses on pharmaceuticals, vaccines and consumer healthcare. R&D leverages genetics and advanced technologies to support its global pharmaceutical business and consumer healthcare business by developing Trillion Dollar Exports H Minhaz Merchant COLUMN MINHAZ MERCHANT The writer is the biographer of Rajiv Gandhi and Aditya Birla and author of The New Clash of Civilizations (Rupa 2014). He is founder of Sterling Newspapers Pvt Ltd., which was acquired by the Indian Express Group

03 June 2023 | B W BUSINESSWORLD | 21 tablish their GCCs in India to digitally transform their businesses, better compete against new-age startups, drive research on newer technologies, and develop pathbreaking solutions, products, platforms, and IP for global consumption.” While India’s infotech companies, large and small, account for $200 billion or over half of total services exports, medical, legal, financial and other consultancies are leveraging domain skills and lower costs to enable India to become the world’s omnibus high-technology office. When India crosses $1 trillion in exports, services exports will, at just under $500 billion, likely contribute half of the total. These numbers are not utopian. At over $32 billion a month currently, services exports are already on a trajectory of $400 billion a year and growing at 15-20 per cent annually. It’s important to put these figures in perspective. India’s huge crude oil import bill (4.5 million barrels a day at an average of $70 per barrel) is currently over $110 billion a year – a major contributor to the current account deficit (CAD). But it will soon be dwarfed by India’s services exports. Significantly, the crude oil revenue of an innovative portfolio of consumerpreferred and expert-recommended brands in pain relief and respiratory care, skincare, digestive health, etc.” Ramkumar Ramamoorthy, a former managing director of Cognizant India, added in a recent article in The Times of India: “In my 22 years at Cognizant I have had the opportunity to witness the diverse facets of GCCs – from the company being incubated as the in-house technology arm of Dun & Bradstreet Corporation, to incubating iNautix, the technology arm of BNY Mellon, to acquiring the in-house centhe world’s largest oil exporter, Saudi Arabia, which ships 10 million barrels a day, is $240 billion a year – less than India’s services exports today. This should not cause complacency among Indian policymakers. To make the export of manufactured goods – from cars and phones to electronics and pharmaceuticals – competitive, the government must upgrade logistics: ports, roads and railway lines. The Adani group’s 13 ports and terminals account for 24 per cent of India’s port capacity. They are connected by over 300 kms of dedicated railway lines, the largest private railway holding in India. It has helped reduce port turnaround time for containers to match the speed of ports in Singapore and Shanghai. Making Maruti Suzuki cars and Apple iPhones for export is one thing; getting them to their destination rapidly needs coordination between transporters, ports and customs. While China’s total exports are largely merchandise with few services, making it a global factory of everything from electric vehicles (EVs) to children’s toys, India’s export basket is well balanced between goods and services. tres of UBS, KBC and Invensys (now Schneider Electric) to co-locating two in-house centres of large enterprises within a fully-owned campus. “The environment in which GCCs operate today is vastly different. From technology being ‘an enabler of business’ to technology being ‘the business’, the definition of what is ‘core’ and ‘context’ to a company has been meaningfully and permanently altered. As such, the cliché that foreign MNCs come to India for cost, stay on for quality, and expand for innovation is no longer applicable. Today, these companies esPhotograph by Arunjorwal123 / Wikimedia Commons To make the export of manufactured goods – from cars and phones to electronics and pharmaceuticals – competitive, the government must upgrade logistics: ports, roads and railway lines

22 | B W BUSINESSWORLD | 03 June 2023 THE CONTRIBUTION of micro, small and medium enterprises (MSMEs) has been central to India’s growth. They contribute to 29 per cent of the GDP, 45 per cent of the total manufacturing output and account for 40 per cent (but declining) of exports. Sixty million MSME units (a third are rural based) employ about 120 million people. They boost consumption, drive economic growth, and also contribute to social mobility. 98% Are Micro-Units The MSMEs continue to suffer multifaceted challenges, however. The regulatory framework is overly complex. The cost of compliance is high. Harassment is rampant. Access to adequate, timely and cost of credit is the weakest link. These are well known and well documented. But there is more. The productivity of micro firms (less than 10 people) is half that of medium firms (with 50-250 people) in most cases. A Crux study across 7,000 MSMEs, 450 bankers, enablers, clients, and other stakeholders in seven industrial clusters, highlights several other challenges, less known, below the radar, and less ‘felt’ – yet equally value depreciating. Only a small fraction has the ability to attract talent, adopt technology, access markets, and apply productive processes. This hurts competitiveness. By Vikas Singh The author is an economist and columnist Limited access to appropriate technology, as well as the ability to acquire it, is detrimental to productivity. The MSMEs pay a high proportion of their revenue on ‘non-core’ activities. The administrative and ‘maneuvering’ cost of an MSME is about twice that of a larger organisation. The ‘Ease of Doing Business’ framework hasn’t percolated to the MSMEs. Scale and size hinders any meaningful investment in productivity tools, perpetuating over 99 per cent of the MSMEs into the low productivity-subscale vicious competitiveness cycle. The Crux study articulates that productivity is key to competitiveness. An insight from the study is that a 30 per cent increase in productivity can propel the ‘small into the ‘medium’ league in four years. Similarly, 10 per cent of the micro enterprises will leapfrog into the ‘small’ category. This could increase the GDP growth rate by a third. Formalisation. Without A Safety Net India has the largest share of micro-enterprises among MSMEs compared to other large industrial economies. The frailty of the Indian economy can be attributed to the missing ‘middle’. The MSMEs have neither the heft nor the competitiveness to add value to the larger corporates. A thriving MSME ecosystem, and the backward-forward symbiotic relationship will make the corporate sector more competitive and enhance value. The MSMEs are not mere ‘vendors’. The ‘development’ of the MSMEs is in the interest of the larger corporates. It has an even bigger role to play, but it shies away from it. The corporate sector must invest in and partner with, mentor and coach MSMEs on best practices. Joint R&D can be equally symbiotic. The cost of MSMEs failing is difficult to fathom, but ripple across the ecosystem. There are lessons aplenty for the economic ecosystem. As much as 98 per cent of the estimated 60 million will never grow beyond micro-enterprises. The Crux study has several lessons. Most MSMEs (even the larger amongst them) have limited aspirations and fewer means. Micro units are ‘DIGITAL PLATFORM’ WILL HELP SCALE MSMES COLUMN Photographs by Indiapicturebudget

03 June 2023 | B W BUSINESSWORLD | 23 industrial structure. It took 20 years. Similarly, MSMEs are the heart of the German industries’ (and economy) competitiveness. ‘Start Small, Will Remain Small’ The MSME policy and institutional framework have failed to identify and address the challenge of competitiveness. Value drivers are determined at three, and interconnected levels i.e., firm, business ecosystem, and economic environment. Our approach has been transactional; offering support, inducing schemes. However, on the ground, support eludes them. The study articulates that only the top decile ‘medium’ and top three per cent of the ‘small’ amongst the MSMEs are competitive enough to create a sustainable growth trajectory. Less than two per cent of the MSMEs are able to ‘build’ capital for expansion. Most others stagnate. The government needs to make bold policy moves. The MSMEs are ‘micro and fragmented’. The ecosystem restricts growth. Capacity limits economies of scale. The government needs an innovative approach to go beyond and create and establish a robust, ‘digital platform’ that promotes, incentivises and fuels collaboration. The platform partners could harness and catalyse the benefits of a united approach to production, marketing, and R&D. The platform can gather contextual data. It can also ‘link’ MSMEs to the relevant stakeholders to serve most needs of the sector. It can access sales and credit-performance data to develop credit scores and share with lenders. The platform could connect MSMEs to both markets and suppliers. It could secure and ‘guarantee’ for them. It can tie up their logistics needs. It would link them to auxiliary service providers that could train and coach, audit, provide legal advice and help them gather, catalyze and exploit business- related and contextual information and knowhow. It could be a multiplier. tied to low productivity and lower competitiveness. It’s a vicious cycle. The compliance and regulatory ecosystem only adds to the challenge. The labour laws (trade union law, Factories Act) make no distinction between a company with 50,000 people or ten. The complex regulatory environment and the cost associated, disincentivises growth. This rippling effect hurts the economy. A good example is the ‘Maharashtra’s New Industrial Belt’, closely ‘linked’ to India’s financial and commercial capital and home to IT, pharmaceuticals, textiles, and consumer durable units. It accounts for five per cent of India’s GDP, and 70 per cent of capital transactions. It boasts of India’s largest container port, and yet 95 per cent of small and medium enterprises have not been able to scale optimally. Only a fraction are globally competitive. Sample this. Over three fourth of the units are ‘micro’ at Tirupur, India’s largest textile cluster. Over 80 per cent of the units at Narayanganj, in Bangladesh, have more than ten employees, making their exports more competitive. The ‘Gurugram-Manesar-Bawal’ belt is the largest automobile ecosystem, accounting for half of four-wheeler manufacturing in India, and is home to a million MSMEs. And yet only a handful may ever scale enough to enhance competitiveness of the larger firms. China owes its rise as an industrial powerhouse to the large coastal SEZs, liberalised regulations, tax benefits and dutyfree imports. Its millions of village enterprises (MSMEs) played an equally pivotal role. The thriving community of small enterprises enhanced the competitiveness of the larger organisations and laid the foundation for a sustainable Only a small fraction (of MSMEs) has the ability to attract talent, adopt technology, access markets, and apply productive processes. This hurts competitiveness Photograph by Ommishra

24 | B W BUSINESSWORLD | 03 June 2023 for personal growth. Adversity can lead to the development of new skills, increased self-awareness, and greater emotional intelligence. By embracing challenges and adopting a growth mindset, individuals can harness their resilience. While human resilience is undoubtedly a powerful force, it is essential to acknowledge that individuals may face limitations and constraints in certain situations. Severe and prolonged trauma or stress can erode resilience, affecting mental health and overall wellbeing. The capacity for resilience may also vary based on personal circumstances, such as socioeconomic factors, support systems, and access to resources. The Importance for Businesses In the context of business, resilience is a critical asset for both individuals and organisations. In an ever-changing and unpredictable world, businesses must navigate through uncertainties, setbacks, and market disruptions. Resilient leaders foster environments that promote adaptability, innovation, and a culture of learning. By cultivating resilience within their workforce, businesses can empower employees to tackle challenges, foster teamwork, and drive success. Encouraging resilience among employees has been linked to increased job satisfaction, higher productivity, and improved overall organisational performance. Moreover, resilient individuals within a company can inspire and support their colleagues, creating a collective culture of resilience that propels the organisation forward. Here are some key aspects of resilience: Positive mindset: Resilient individuals tend to have a positive outlook on life and believe in their ability to overcome obstacles. They maintain hope and optimism, even in challenging times, which helps them persevere and find solutions. Emotional regulation: Resilient people are skilled N THE FACE OF ADVERSITY and challenges, the human capacity for resilience shines as a remarkable gift from nature. Resilience enables us to bounce back from setbacks, adapt to change, and even thrive amidst adversity. However, an intriguing question arises: Is there a limit or capacity constraint to human resilience? Delving into the depths of scientific knowledge, we can shed light on this subject, exploring the extraordinary potential of resilience and its significance in our lives. More importantly, what it adds as a context to individuals, and especially in the workplace. Resilience is an inherent quality that resides within each of us. It is the strength to overcome obstacles, the courage to persist when the going gets tough, and the ability to grow and evolve in the face of adversity. This gift has been crucial throughout human history, enabling us to survive and progress in the face of countless challenges. Resilience is not about avoiding or eliminating challenges; instead, it focuses on developing inner strength and coping mechanisms to effectively navigate and overcome difficulties. Scientific Insight Scientific research has elucidated fascinating aspects of human resilience, demonstrating its multifaceted nature and limitless potential. While individuals vary in their innate resilience levels, studies have shown that resilience can be cultivated, nurtured, and enhanced through various mechanisms. Neuroplasticity, the brain’s ability to reorganise and adapt, plays a pivotal role in resilience. The brain has an extraordinary capacity to rewire its neural connections in response to experiences, enabling individuals to develop coping strategies and adapt to new circumstances. Furthermore, research suggests that resilience is influenced by genetics, environment, and individual experiences, highlighting the intricate interplay between nature and nurture. Human beings possess the remarkable ability to learn from setbacks and use them as catalysts Resilience, a Human Effort or Gift? PEOPLE TALK By Srinath Sridharan & Steve Correa “Life doesn’t get easier or more forgiving; we get stronger and more resilient.” — Steve Maraboli I

03 June 2023 | B W BUSINESSWORLD | 25 Learning from setbacks: Resilient people view setbacks as learning opportunities. They understand that failure and mistakes are part of life and use them as steppingstones for growth. They reflect on their experiences, extract valuable lessons, and apply them to future challenges. Developing resilience is a lifelong process that can be cultivated and strengthened. While some individuals may naturally possess more resilient traits, everyone has the capacity to enhance their resilience through self-awareness, practice, and a willingness to grow. It is important to note that resilience is a complex and multidimensional construct, and research in this area is ongoing. The 21st Century is characterised by constant change, driven by advancements in technology, globalisation, and shifting customer expectations. As businesses navigate unprecedented challenges, technological advancements, and shifting market dynamics, fostering a culture of resilience is essential for both individual employees and the overall success of organisations. Organisations that embrace resilience are better equipped to navigate this dynamic environment. Resilient employees possess the ability to adapt swiftly, embrace new technologies, and develop innovative solutions to emerging challenges. They are open to change, possess a growth mindset, and view obstacles as opportunities for growth and improvement. at managing their emotions. They acknowledge their feelings without letting them overwhelm or control their actions. They understand that emotions are temporary and develop strategies to cope with stress and anxiety. Adaptability: Resilience involves being flexible and adaptable in the face of change. It is about adjusting one’s mindset and behaviours to meet new circumstances and challenges. Resilient individuals can quickly assess situations, identify necessary changes, and take appropriate action. Social support: Building and maintaining strong social connections is crucial for resilience. Having a supportive network of family, friends, or community members provides emotional support, practical assistance, and a sense of belonging. Sharing experiences and seeking help from others can contribute significantly to resilience. Problem-solving skills: Resilient individuals are effective problem solvers. They approach challenges with a proactive mindset, break them down into manageable parts, and identify potential solutions. They are open to alternative perspectives and are willing to try different strategies until they find what works. Self-care and well-being: Taking care of oneself physically, mentally, and emotionally is essential for resilience. This includes maintaining a healthy lifestyle, engaging in activities that bring joy and relaxation, practicing self-compassion, and prioritising mental and emotional well-being. Srinath Sridharan is author, Time for Bharat, an executive coach & corporate advisor; Steve Correa is executive coach, OD Consultant & author of The Indian Boss at Work The 21st Century is characterised by constant change, driven by advancements in technology, globalisation, and shifting customer expectations. As businesses navigate unprecedented challenges, technological advancements, and shifting market dynamics, fostering a culture of resilience is essential for both individual employees and the overall success of organisations Photograph by Jeremy Richards

26 | B W BUSINESSWORLD | 03 June 2023 NTREPRENEURSHIP encourages innovation and enables an economy to make a quantum leap in terms of total growth and development by meeting market demand by combining capital, labour, and natural resources and producing value, thereby producing a growth-inducing innovation ecosystem. Jean-Baptiste, an early 19th Century French economist, had once opined that an entrepreneur is one who “shifts economic resources out of an area of lower and into an area of higher productivity and greater yield”, indicating that entrepreneurial activities form a critical aspect of an economy, and more so in current times. India has recently focused more on encouraging entrepreneurship through various programmes and initiatives. The government introduced a flagship programme called StartUp India in 2016 to promote entrepreneurship. There are expected to be 92,683 recognised startups by 2023, up from 442 in 2016 in the country. The importance of funding entrepreneurs has also been emphasised in recent years. The StartUp India Seed Fund Scheme, which was started in 2021, saw the approval of Rs 477.25 crores for 133 incubators. It is clear that focused and coordinated efforts are being made to foster an environment where entrepreneurs can FROM START-UP INDIA TO SCALE-UP INDIA ARTHSASTRA by Amit Kapoor& Amitabh Kant Clockwise: Amit Kapoor is Chair, Institute for Competitiveness & Lecturer, Stanford University Amitabh Kant is G-20 Sherpa & former CEO of NITI Aayog E prosper. India has taken a very significant step in this regard. Still, more needs to be done to ensure the scaling up of businesses, a crucial component of entrepreneurship growth and development. Several academic research has focussed on the absence of middle-sized firms in developing countries. The business climate in India is seeing a similar trend. According to the MSME Annual Report of the Government of India (2022-23), the Micro sector is anticipated to have 630.52 lakh firms, accounting for almost 99 per cent of all estimated MSMEs in the country. As many as 3.31 lakh businesses are located in the small sector, and only 0.05 lakh are in the medium sector. Policies must comprehend the causes of the current predicament in order to address India’s missing middle scenario. Companies are unable to move from the micro to the mid-size stage. These mid-sized firms have the most potential to develop into major businesses. India is home to approximately 600 significant enterprises that are 11 times more productive than the average and contribute almost 40 per cent to overall exports, according to a report by the Mckinsey Global Institute titled India’s turning point (2020). The importance of increasing the number of large enterprises in the country cannot be overstated if we are to achieve

03 June 2023 | B W BUSINESSWORLD | 27 our development goals. A micro corporation must overcome a number of obstacles, including limited access to capital, a reduced ability to do considerable R&D, limited market access, and difficulty with technical advancement, among others. Additionally, small businesses are more susceptible to the damaging effects of unforeseen circumstances. They might not be resilient because they lack the resources to weather an economic downturn. In this situation, scaling up businesses can aid in giving companies resilience and growth potential. A bigger enterprise can provide more in the way of revenue and can employ a larger portion of the labour force. Scaling up helps businesses adopt newer technologies, gain access to new markets, and streamline production procedures, all of which increase productivity. Based on extensive company assessments, it is crucial to be aware of the challenges micro-organisations confront in their growth trajectories. Simplifying and streamlining the regulatory environment for businesses and fostering access to capital are the two main areas to concentrate on for enhancing the ease of doing business and moving to larger firms. According to the most recent remarks made by Finance Minister Nirmala Sitharaman, over 39,000 compliances have been reduced, and over 34,000 law provisions have been decriminalised in order to facilitate ease of doing business. It is well recognised that a heavy regulatory load deters businesses from expanding, making it desirable for them to remain smaller and beyond the purview of the official system. But the government is encouraging a shift in perspective from seeing starting a firm as a challenging task to a relatively straightforward one. The goal has been to eliminate hesitancy among business owners and instil confidence in them so they can expand their operations. Making sure that the programmes created to support the growth of micro and small businesses are adequately executed is a significant responsibility. Additionally, a number of initiatives have been made to make it easier for businesses to acquire credit, particularly those who have resisted using the formal credit system because of obstacles such as absurdly high interest rates and onerous collateral requirements. The Udyam Assist Platform is a good example of this because it works to formalise unofficial Micro Enterprises so they can benefit from Priority Sector Lending. PM SVANidhi (PM Street Vendor’s Atmanirbhar Nidhi), which offers financing to small business owners like hawkers and street vendors, is yet another noteworthy programme. The foundation of the economy is MSMEs. They hold the potential and dreams of millions of Indians. Simplifying and streamlining the regulatory environment for businesses and fostering access to capital are the two main areas to concentrate on for enhancing the ease of doing business and moving to larger firms Photograph by Peshkova/Canva

28 | B W BUSINESSWORLD | 03 June 2023 ECENTLY I WAS invited by a major manufacturer of machine tools to speak during their golden jubilee celebrations. Their suggestion for the topic – ‘Sustainability is Good Business’ – being of great interest, I accepted immediately. It was heartening to learn that more and more companies are now conscious of the need to work towards sustainability, often beyond mandatory ESG declarations in the annual report. Sustainability is indeed a buzzword today but so far I have written about water availability, air quality, irresponsible real estate industry, deforestation, waste management, urban flooding, plastics pollution in the cities and the oceans etc. Relatively little is known about the role of the manufacturing industry – what they are doing and should be doing and how their actions impact the global effort towards sustainability. We know that every single action releases harmful emissions – even as I am keying in this column or when I was speaking at this company’s event or when I am driven to a meeting – everything uses energy and that means emissions. Operations in a big factory are far more complex, involve much greater use of power and water and result in huge amounts of greenhouse gases (GHGs). So, in this column, I will list out some steps that every factory should follow in the interest of sustainability. u The easiest way would be to contact IGBC (Indian Green Building Council) which is a one-stop outfit for not only examining and rating factory buildings but also guiding manufacturers through the process of achieving energy, water and materials efficiency as well as indoor environment quality and innovations, including in the design process. This is a CII initiative that has helped many companies. Their rating is not mandatory under the government ESG rules but a voluntary association can be a step ahead on the way to achieving sustainability. They start with audits, followed by suggestions to achieve excellence and their ratings – especially the coveted ‘platinum’ – is very useful, especially when dealing with foreign customers. The tangible benefits include: v Energy saving of 30-40 per cent, water saving of 20-30 per cent, as well as intangible ones like improved indoor quality, good daytime lighting, health and wellbeing of occupants and safety of workmen. I would urge every factory to strive for the same. w Recycle everything possible and minimise waste. Don’t just throw away that waste; sell it instead! Whenever anyone pays for a thing – however small the consideration – they value it. x Reduce use of energy in: (a) Lighting; Non flicker LED bulbs and tubes are the most efficient. Unfortunately – despite the high price – availability R Manufacturing Sector Also Needs to Chip In Sustainability By Krishan Kalra Column

03 June 2023 | B W BUSINESSWORLD | 29 (f) Daily Measurement of Energy Use; It is important to measure energy usage on a daily basis and keep a record so one can try to figure out ways of reducing the same. (g) Transformers often cause loss of energy, so it is important to measure energy input and output for each transformer and replace those wasting higher amount of energy. (h) Reduce Water Consumption Water is crucial and must be conserved meticulously. The trick is again to (a) measure and record daily usage and figure out ways to plug leakages and reduce wastage (b) Recycle all waste water whether used in cooling machining jobs or hand washing, cooking, cleaning, sewage etc. (c) use ‘waterless’ urinals (d) collect condensate from air conditioners and RO purifiers. (e) Washing of floors and vehicles must not use hoses; good old ‘pocha’ (swab) can save lots of water (f) watering of lawns and plants must be early mornings or late evenings to minimise loss by evaporation. (i) Work Area Environment. Indoor air temperature must be maintained at 24 degrees centigrade as mandated by GOI, CO2 should be less than 600 ppm and TVOC (total volatile chemicals) below 50 micrograms/metre3. If this is achieved, along with PM 2.5 < 15ug/m3 – as per an Oxford University study – the cognitive ability of workers can increase almost three times (www.thecogfxstudy.com). These measures are also very good for health and productivity. (j)Go For Carbon & Water Neutrality. Large conglomerates like ITC and Pepsi keep advertising about their ‘water and carbon neutrality’. Others like Mahindras, Aditya Birla, JSW, Adani Transmission, Vedanta and Dalmia Cement are also doing good work. It would be useful for every company to make endeavours to achieve the same – meaning any CO2 released into the atmosphere from a company’s activities needs to be balanced by an equivalent amount removed through afforestation/tree planting, total ‘rain water harvesting’, composting all food and garden waste etc. Again, measuring, recording, validating and reducing use of water and carbon emissions is crucial. The British Standards Institution’s guidelines for the same are very useful. Carbon sequestration by way of planting thousands of trees and mangroves in case of large coastal factories like Reliance and Godrej are very successful, as is afforestation by ITC for their own use in paper plants. is limited. Most LEDs in the market are of the ‘flickering’ type. The human eye cannot distinguish the difference, but a good camera detects the flicker. Not only do these consume more energy, these are also harmful for human beings and often lead to discomfort. (b) Screens; All modern factories have hundreds of screens – on each machine, in inspection rooms, offices, security etc. and most are LCD. Replacing these with LED screens is a good idea. (c) HVAC; Motors, Heaters, ACs, fans, coolers, pumps – all come with star ratings based on their energy efficiency; using good five-star rating ones is recommended. (d) Free Cooling; An excellent approach to energy conservation is optimisation of ‘free cooling’. Whenever the ‘wet bulb’ temperature is lower than the ‘dry bulb’ reading, ‘free cooling’ is available, using a properly designed heat exchanger and a cooling tower with a reach of one degree centigrade. (e) Reflective Surfaces; Every square inch of the factory roofs that is not occupied by solar panels must be covered with either glazed white tiles or high albedo white paint. This will reflect back heat from the sun and reduce absorption in the factory premises to keep them cool Operations in a big factory are far more complex, involve much greater use of power and water and result in huge amounts of greenhouse gases (GHGs). So, in this column, I will list out some steps that every factory should follow in the interest of sustainability The author is Trustee of The Climate Project Foundation, India and past president of AIMA and past BOG member of IIMC Photograph by Tampatra

30 | B W BUSINESSWORLD | 03 June 2023 WHAT IS CHATGPT? ChatGPT was created by the company Open AI and released on 30 November,2022. It is a generative chatbot that produces unique answers in response to any human input or questions. The original release of ChatGPT was based on GPT-3.5, which is known for its capacity to produce text or response to any query which perfectly replicates a human written text. Now, the newest Open AI model was released on 14 March, 2023 which is a version based on GPT-4 and this is available for paid subscribers. In order to learn the language from massive volumes of data, chatbot used advance learning techniques. Books, blogs, news articles and online comment boards were used by Open AI to train its chatbot. It should be noted that ChatGPT was trained by a whopping 570 GB of data, containing 300 billion words. A study by Swiss Bank UBS revealed that ChatGPT is the fastest growing app of all times. HARNESS THE POWER OF CHATGPT TO SCALE UP YOUR BUSINESS HOW CAN CHATGPT BE USED FOR SMALL BUSINESSES? u Language Translation Service: ChatGPT can instantly translate languages. If your work or business requires translations of different languages to communicate with people in different parts of the world, ChatGPT can do so in seconds for you. But it is best to get the translation reviewed by a translator because the chatbot responses are not always 100 per cent accurate. v Content Creation: Creating content ideas is another function of ChatGPT. With the prompt given by you, the AI powered tool can help create blog posts, social media updates, articles and other forms of written content in very little time. The use of ChatGPT prompts can speed up and increase the effectiveness of your content creation process. Alice Wu, PR associate with Mind Meld PR recommends that the tool be used for small businesses that are looking to create more content for their social media handles, websites etc. In order to learn the language from massive volumes of data, chatbot used advance learning techniques. Books, blogs, news articles and online comment boards were used by Open AI to train its chatbot. It should be noted that ChatGPT was trained by a whopping 570 GB of data, containing 300 billion words. A study by Swiss Bank UBS revealed that ChatGPT is the fastest growing app of all times COLUMN DIGITAL MARKETING / Anu Sehgal Photograph by Ritesh Sharma

03 June 2023 | B W BUSINESSWORLD | 31 ChatGPT can provide round-the-clock customer service by taking care of common inquiries in a conversational manner, placing orders and supplying resources automatically while freeing your staff to do other important work at hand. Also, instant responses given are much appreciated by the customers, possibly raising customer service ratings The author is an entrepreneur in the digital space w Customer Service: ChatGPT can provide round-the-clock customer service by taking care of common inquiries in a conversational manner, placing orders and supplying resources automatically while freeing your staff to do other important work at hand. Also, instant responses given are much appreciated by customers and could possibly raise customer service ratings. x For Coding: In the software sector, ChatGPT is creating a lot of buzz. You may ask the chatbot to provide code snippets or perhaps write some or all of your programme if you are feeling stuck in your project. The same may be done if you want to debug the current code. The important thing to do here is to give correct prompts. With the right prompting ChatGPT can assist with code logic, syntax errors and even the conversion of code between different programming languages. y HR Issues: ChatGPT is used by HR departments for a variety of HR-related duties including reviewing résumés, conducting preliminary interviews and assisting in onboarding. Conflicts at workplace, nepotism, theft or any other issue can be dealt by asking ChatGPT and thereby obtaining a solution. HERE ARE A FEW DRAWBACKS: Despite the fact that ChatGPT is an excellent tool, yet there are a few drawbacks to it. To avoid any predicament, make sure to carefully fact check anything written by the chatbot. Also the content created by ChatGPT should not be published as it is, because that can incur penalty from the search engines. Alter or edit it, as per your discretion. Proof-read any output given by it. Verify its accuracy as it should correspond to your brand voice and style. And last but not the least, do not give any sensitive information as it might get stored for future AI training purposes.Cameron Garrison, CEO of Guardian Lemon Law says “I have mixed feelings about it. I like it, but my fear is that the unemployment rate will go way up.” Photograph by Alexdndz

32 | B W BUSINESSWORLD | 03 June 2023 NTREPRENEURSHIP is complex, especially if you’re building a category that never existed. To wake up each morning with a dream to make a change, and to keep at it every day requires intense passion and even deeper commitment. That’s what it took to start Zepto in the midst of a pandemic – a passion to solve a problem that was intrinsic to every Indian household. Two years later, that passion has turned into a business founded on customer obsession, experiments, failures, and more than anything – learnings that came from being bold. Building one of India’s fastest-growing startups in the consumer internet space has been a humbling journey but certainly not without its own set of challenges. Embrace Passion, Persistence & Failures In 2020, during the lockdown, getting groceries was enormously painful, with limited windows of inperson shopping and online options taking many days to deliver. Finding a solution to this problem was initially just a fun side project while stationed in Mumbai amidst the pandemic. This prompted my Co-founder, Aadit and I to start looking for a solution. We launched multiple products and tested different models, from a pick-up-and-drop service to delivery SaaS for local stores. During this time, we did hundreds of deliveries ourselves, manned customer support calls till 3 o’clock in the morning, and kept iterating on their software and operations model – eventually, we became obsessed with solving this problem. Passion, Persistence & a 10-minute Promise COLUMN By Kaivalya Vohra E After almost a year, every model that we tried scaling failed. With pressure mounting from our families to focus on academics at Stanford, Aadit and I were on the verge of quitting –until we started an experiment with delivery-focused facilities based on a hunch that this model could facilitate faster delivery times, a better assortment, and fresher products. We were right. The product-market fit with the dark store model was incredible, and it was visible in the data: Month-1 Buyer Retention shot up to 60 per cent plus, NPS stabilised in the high 80s, and frequency of usage almost doubled. The opportunity to scale an incredible product and build a generational company was in front of us. So, Aadit and I decided to risk our futures, drop out of Stanford, and start Zepto. Zepto started as an idea to make online groceries convenient during the lockdown and soon progressed to pioneer a wave of quick commerce in the country. Powered by balanced delivery distances and strong tech capabilities, we managed to make 10-minute grocery deliveries a reality in the country. Investing in Growth and Learning We knew that we were competing with legacy companies and that there would be challenges and uncertainties. The odds were stacked against us, but we were determined to make an impact no matter the rocks and mountains we had to climb, or even cross. As teenage founders, it was incredibly difficult to convince investors to take us seriously. But eventually, we were able to leverage Zepto’s clear product-market fit to raise $9 million (led by Nexus Venture Partners). With capital The opportunity to scale an incredible product and build a generational company was in front of us. So, Aadit and I decided to risk our futures, drop out of Stanford, and start Zepto. Zepto started as an idea to make online groceries convenient during the lockdown

03 June 2023 | B W BUSINESSWORLD | 33 matter experts is crucial. They bring specialised skills and insights that complement your own. By hiring experts, you can tap into their expertise, learn from them, and collectively tackle complex problems! Building a Generational Company An entrepreneurial dream needs discipline and focus. Our biggest asset since day one was our strength in Unit Economics. Unlike competitors who had massive balance sheets, Zepto had access to a finite amount of capital. This meant perfecting Unit Economics since the early days. This also helped us sustain and grow our business when the public and private markets were under extreme pressure. Our Unit Economics advantage is helping us gain even more market share because we can continue investing in sustainable growth while most high-burn consumer internet companies have been forced to pull back. Our vision has always extended beyond building a conventional quick commerce startup. We have always strived to establish a transformative institution that distinguishes itself through technological prowess and innovative solutions. We made the customer our north star at Zepto; thereby investing in best of talent, technology and processes to deliver an unparalleled customer experience. As we grow, we are doubling down on resources and pushing the boundaries to leave a lasting imprint and shape the future of quick commerce. As an entrepreneur, falling in love with the product and building that conviction really just pushes you to see that product through. We saw ourselves as custodians of what would probably end up being a large phenomenon in consumer internet in India and that is what we remind ourselves every day. in hand, Aadit and I took the unconventional decision of hiring a slew of senior executives to form Zepto’s management team on Day 1. During the pilot stage, Zepto had $0 in revenue. We only had a vision and knew that to scale this vision and bring the model to life we needed people who had an experience in building companies from ground zero. Despite having no revenue and being just in its pilot stage at the time, we were able to convince and hire seasoned leaders from some of India’s top consumer internet companies to join our CXO team. This team was critical in building the early systems and processes that helped Zepto scale rapidly. With a phenomenal leadership team in place, Zepto formally launched to the public on the 14th of July, 2021 – its first serviceable geography was Bandra in Mumbai. The platform started exploding, mainly through word-of-mouth, and the Zepto team started racing to launch new dark stores and new geographies. On the back of unprecedented growth, Zepto raised three more rounds, bringing our last valuation to $900 million. Within months of founding Zepto, quick commerce was the fastest-growing category in the consumer internet space in the country and we were the fastest-growing Indian company of all time. When venturing into startups with limited knowledge, assembling a team of subject The author is Co-founder & CTO, Zepto An entrepreneurial dream needs discipline and focus. Our biggest asset since day one was our strength in Unit Economics. Unlike competitors who had massive balance sheets, Zepto had access to a finite amount of capital. This meant perfecting Unit Economics since the early days. This also helped us sustain and grow our business when the public and private markets were under extreme pressure Photograph by Indiapicturebudget

34 | B W BUSINESSWORLD | 03 June 2023 OST OF US, as a rule, are prone to break the rule. We see and experience this every day, on so many occasions in our daily life, but nowhere is this rule-flouting as visible as on our roads. The previous edition of this column listed – tongue-in-cheek – the virtues and benefits of violating driving rules and ignoring discipline (Wrong-Side Driving, BW 20 May, 2023). This column looks at the obverse: the negative consequences of indiscipline, and the cost it imposes on society. On busy roads of every city in India one will see railings on the central divider, at least for some part of the road. Anyone unfamiliar with the country will wonder as to their purpose. We know, of course, that these are intended to stop pedestrians from crossing the road wherever they please. UNSAFE CROSSING Such crossing not only affects the flow of traffic, but puts the walker at serious risk. Given the possible bodily harm that could occur, rationality would dictate that such a crossing is irrational and unwise, especially when safety is better assured by M walking a few hundred metres (or less) to the nearest traffic signal or to a marked “zebra crossing”. If the discipline of doing so is followed, there would be no necessity for spending a large amount of money on installing a railing on the divider. THE NECESSITY OF RAILINGS This seems like a win-win situation: following the basic principle of using a designated place for crossing the road will ensure safety for the pedestrian; smooth driving for the vehicle (with no need for a sudden stop and the possible hit by a vehicle from behind; or the worse result of hitting a pedestrian); and a saving of unnecessary cost (of the railing) for the city or state. Despite these obvious plus factors, why do people cross where they please and thereby necessitate railings? One reason is that cars – and especially motorbikes – are unlikely to stop at a zebra crossing to give priority to walkers, unless there is a traffic signal there. At junctions where there are traffic signals, most permit a “free left” (turn), resulting in a continuous flow of vehicles and making it difficult for pedestrians to cross easily. An additional reason is that we are attuned to taking a short-cut in every situation: so, few will bother to walk the extra few hundred metres to the nearest crossing, even if it is an overhead pedestrian walkway with escalators (not uncommon in Delhi). Amplifying the nudge to negative behaviour is the fact that most walkers have little confidence that vehicles will stop for them at marked crossings. So, the only safe solution is to instal railings, and suffer the unnecessary cost. Where investments are made in overhead or underground pedestrian crossings, they are minimally used, and a railing on the divider is also added at additional cost. In a further irony, even after this, the more agile pedestrians are seen honing their obstacle-course skills by jumping over the divider-railing! Not to be left behind, there are THE PRICE OF INDISCIPLINE By Kiran Karnik COLUMN n KIRAN’S KONTRARIAN KORNER n

03 June 2023 | B W BUSINESSWORLD | 35 The author loves to think in tongue-in-cheek ways, with no maliciousness or offence intended. At other times, he is a public policy analyst and author. His latest book is Decisive Decade: India 2030 Gazelle or Hippo (Rupa, 2021) often man-made gaps created in the divider by intrepid vehicle drivers who find it a pain to drive a kilometre to the next uturn. Of course, as spelt out in a previous piece, this saves time and fuel, resulting in individual and national benefit! RULES FOR PEDESTRIANS Often, pedestrians too join the show, helpfully creating a shortcut for all by dismantling part of the railing, thereby facilitating a quick dart across the road at whatever point enables them to minimise their walking. Traffic police, if deployed, seem generally unaware of any rule or convention that requires cars to stop for pedestrians at marked crossings or for the latter to not cross wherever they please. Policepersons – like the drivers – apparently believe that cars have right of way anywhere on the roads; also, that there are no rules for pedestrians. Of course, many cities have signboards that proclaim some areas as “no tolerance zones” (of traffic violations, one presumes); maybe all other areas are “no enforcement zones”! Generally, there are no footpaths, indicative of a belief that money spent on walkways is a waste; in any event, pedestrians are habituated to walking on the road. Better, instead, to expand the road and allow it to be shared by vehicles and walkers. After all, “sharing” is a virtuous value. Where the investment on a footpath is made, it is promptly dug up (possibly to prove how wasteful such expenditure is) and then left unattended for months – sometimes permanently. If not, then the footpath is promptly occupied by hawkers, parked motorbikes, and miscellaneous debris. This happens if motorised two-wheelers have not beaten them to it, by using the footpath as an extension of the road (indeed, a good way to reduce the traffic jam on the road). In some cities, in keeping with the sharing philosophy, the virtue is extended further – on both roads and footpaths – to the animal world, with stray dogs and cattle being the primary beneficiaries. THE COST OF RAILINGS I am yet to find data on the investments in railings, and overhead and underground crossings. Similarly, it is hard to find specific figures on the loss of human life due to road indiscipline, or the cost due to accidents caused by wrong-side driving, or resulting from vehicles ignoring lane discipline. Doubtless, it is not insubstantial. Instead of wasteful expenditure on ineffective solutions like railings, or band-aid and short-term solutions like continuously broadening roads (inevitably at the cost of footpaths), would it not be far better to invest a small amount on education and awareness-creation about road discipline, and on enforcing it? Will some city, state, or police establishment wake up and at least experiment with this solution? Where investments are made in overhead or underground pedestrian crossings, they are minimally used, and a railing on the divider is also added at additional cost. In a further irony, even after this, the more agile pedestrians are seen honing their obstacle-course skills by jumping over the divider-railing! Not to be left behind, there are often man-made gaps created in the divider by intrepid vehicle drivers who find it a pain to drive a kilometre to the next u-turn Photograph courtesy: NHAI

36 | B W BUSINESSWORLD | 03 June 2023 HAT HAS KARMA got to do with modern enterprises, stakeholder interventions and commercial intent? The concept of Karma is deeply rooted in Indian spirituality and philosophy, and it has been a guiding principle for individuals and communities for thousands of years. Karma is often associated with the idea of cause and effect. It refers to the idea that the actions and intentions of an individual have consequences, which can be positive or negative, depending on the nature of the action. For most of us, the challenge is not in the concept itself, but in accepting that someone could have thought of such powerful values-ideology, in such a simple and firm way, centuries ago. Hence we fight this, with a modern cover under what we think is religion or other -isms. But the reality is that ancient scriptures have such powerful messaging for modern day living. Humans have not changed in their core behaviour, to the extent to which changes have occurred in how we live in the name of modern society. We still have basic human emotions, that’s been unchanged for centuries – anger, greed, anxiety, fear, jealousy, wanting to conquer, endless needs, desire, and so on. In recent years, there has been a growing emphasis on corporate social responsibility and ethical behaviour in modern enterprises. Companies are increasingly expected to consider their impact on society and the environment, and to prioritise sustainability and ethical practices. At the same time, the concept of karma, the idea that our actions have consequences, has become increasingly relevant in modern business culture. In many ways, karma can be seen as the ESG (environmental, social, and governance) of modern enterprises. Karma, in Scriptures The Bhagavad Gita, one of the most influential texts from India, provides extensive guidance on the nature of karma and its practical applications in daily life. The Bhagavad Gita defines karma as the actions and intentions of an individual, and it teaches that these actions and intentions have consequences that are either positive or negative. “As a person puts on new garments, giving up old ones, similarly, the soul accepts new material bodies, giving up the old and useless ones.” (Bhagavad Gita 2.22) This means that consequences of our actions in this life will carry over to the next, shaping our destiny and determining our ultimate fate. While karma has traditionally been associated with religion and spirituality, it has practical applications in all aspects of life, including business. In fact, karma can be a powerful tool for businesses to build a positive reputation, establish trust with customers, and create a culture of ethical behaviour. Stakeholder capitalism is a concept that has gained significant traction in recent years, intensifying the need for W Karma and the Modern Businesses (A)muse & Musings By Srinath Sridharan

03 June 2023 | B W BUSINESSWORLD | 37 unto the Supreme Lord, is unaffected by sinful action, as the lotus leaf is untouched by water.” (Bhagavad Gita 5.10) This means that the true nature of our actions is determined by our intention behind them. Businesses can apply the principles of karma by prioritising ethical behaviour, social responsibility, and a commitment to making a positive impact on society. One of the key principles of karma is the idea that what goes around comes around. In other words, the actions and intentions of a business will have consequences, and those consequences will ultimately determine the success or failure of the business. This is particularly true in today’s business environment, where consumers are more informed and more socially conscious than ever before. Need for Ethical Behaviour “Those who are motivated only by desire for the fruits of action are miserable, for they are constantly anxious about While karma has traditionally been associated with religion and spirituality, it has practical applications in all aspects of life, including business. In fact, karma can be a powerful tool for businesses to build a positive reputation, establish trust with customers, and create a culture of ethical behaviour businesses to consider the interests of all their stakeholders, including customers, employees, suppliers, and the wider community. At its core, stakeholder capitalism aims to create longterm value for all stakeholders, rather than focus solely on maximising shareholder profits. This is where karma is applicable to stakeholder capitalism conversations, as it promotes the idea of taking responsibility for one’s actions and considering the impact of those actions on others. Law of Consequences “Whatever action a great man performs, common men follow. And whatever standards he sets by exemplary acts, all the world pursues.” (Bhagavad Gita 3.21) This highlights the fact that the actions of a business leader can influence the actions of others, both within the business and in the wider world. “One who performs his duty without attachment, surrendering the results Photograph by Depositedhar

38 | B W BUSINESSWORLD | 03 June 2023 By Srinath Sridharan the results of what they do.” (Bhagavad Gita 2.49) In the business world, this means focusing on doing what is right, rather than solely on making a profit. A business that prioritises ethical behaviour and social responsibility is more likely to build a positive reputation and attract loyal customers. This is because consumers are increasingly looking for businesses that align with their values and are committed to making a positive impact on society. Furthermore, businesses that prioritise karma are more likely to attract and retain top talent. This is because employees are more likely to be motivated by a sense of purpose and a commitment to ethical behaviour than they are by financial incentives alone. In order to prioritise karma, businesses need to focus on three key areas: transparency, accountability, and social responsibility. This means being transparent about business practices and decision-making processes, holding employees and leadership accountable for their actions, and being committed to making a positive impact on society. Karma & Shared Values One of the key principles of stakeholder capitalism is the idea of creating shared value, which involves creating economic value in a way that also creates value for society and the environment. This concept is closely aligned with the idea of positive karma, which suggests that good actions can have positive consequences for both the individual and society as a whole. For example, a business that prioritises the well-being of its employees, by offering fair wages and benefits, a safe working environment, and opportunities for personal and professional growth, is likely to create positive karma for itself. This can lead to increased employee loyalty, higher productivity, and a better reputation in the community, all of which can contribute to long-term business success. On the other hand, businesses that prioritise short-term profits at the expense of their stakeholders, such as by exploiting workers or polluting the environment, may create negative karma for themselves. This can lead to reputational damage, legal and regulatory challenges, and a loss of trust and loyalty among customers and employees, all of which can have significant negative consequences for the business in the long term. Karma, as a context, can guide companies to act in a way that is ethical, responsible, and sustainable. Companies that prioritise karma are more likely to build a strong reputation and earn the trust of customers, employees, and stakeholders, leading to improved business outcomes and a more positive impact on society as a whole. As the focus on corporate social responsibility and ethical behaviour continues to grow, the concept of karma is likely to become increasingly important in modern business culture. The writer is the author of Time for Bharat, a policy researcher & a corporate advisor One of the key principles of stakeholder capitalism is the idea of creating shared value, which involves creating economic value in a way that also creates value for society and the environment. This concept is closely aligned with the idea of positive karma, which suggests that good actions can have positive consequences for both the individual and society as a whole (A)muse & Musings Photograph by Darkdiamond67 / Canva

03 June 2023 | B W BUSINESSWORLD | 39 When it comes to meeting long-term financial goals, investing in a disciplined manner is of essence. While many may do it, there is one aspect along with discipline that is most required. And that is asset allocation. Investors often tend to overlook this aspect and end up paying a heavy price in one’s wealth creation journey. When the market is bullish, investors tend to go overboard on equities which in the short-term may look like a wise move. But as and when the tide turns and the market turns volatile or enters a correction phase, the decision may prove to be a very costly mistake. What could have averted this situation is, adhering to asset allocation, which is an investment strategy that involves diversifying investments across different asset classes such as equity, debt, commodities, cash etc. The goal of asset allocation is to balance risk and reward by spreading investments across different asset classes to reduce the overall risk of the portfolio while still achieving desired returns. Benefits of Asset Allocation The primary benefit of asset allocation is risk reduction. By diversifying investments across different asset classes, investors can reduce the risk of their portfolio. Another benefit of asset allocation is that it allows investors to take advantage of different market appropriate investment products for their portfolio. There are a variety of investment products available in the market, including mutual funds, exchange-traded funds (ETFs), individual stocks, and bonds. Each investment product has its own advantages and disadvantages, and investors need to carefully evaluate each product before making a decision. Additionally, asset allocation requires ongoing monitoring and rebalancing. Market conditions and the performance of individual investments can cause the allocation mix to deviate from the decided target. Hence, investors need to regularly review their portfolio and adjust their asset allocation mix to ensure that it aligns with their investment objectives and risk tolerance. Solution for Investors As a means to help investors address these challenges, mutual fund houses today offer asset allocation schemes. These are offerings wherein the fund manager allocates money across various asset classes basis the macro environment and their relative attractiveness. The allocation here is largely dynamic in nature. Depending on the basis of one’s requirement, they may choose offerings which diversify across equity and debt or equity, debt, gold and other asset classes as well. In effect, an investor need not worry about allocating to various asset classes, rebalancing etc. as the fund manager will be doing all of these on the investor’s behalf. n WHY ASSET ALLOCATION MATTERS Investors need to regularly review their portfolio and adjust their asset allocation mix to ensure that it aligns with their investment objectives and risk tolerance. By Khyati Mashru Vasani conditions. For example, when interest rates are low, bonds may not provide significant returns, but equities may perform well. By diversifying investments across different asset classes, investors can take advantage of these market conditions. However, asset allocation can be a challenging task for investors, especially for those who lack the necessary knowledge and experience. Stumbling Blocks One of the challenges faced by investors is determining the appropriate asset allocation mix for their portfolio. The asset allocation mix should be based on the investor’s investment objectives, risk tolerance, and time horizon. It is important to strike a balance between risk and return, and investors should not invest all their money in a single asset class. Another challenge faced by investors is selecting the Khyati Mashru Vasani, Founder & Chief Financial Coach, PlantRich LLP mall opportunities are often the Sbeginning of great enterprises.� Every single drop in the ocean counts. When talking about a progress of a developed or developing countries worldwide, we can't undermine the signi�cant role of SMEs. Undoubtedly, small and medium sized enterprises have made an indelible landmark on the economic landscape due to their premeditated importance in reengineering the industrial sector. Owing to their signi�cant inputs and involvement, SMEs assumes a pivotal responsibility in socio-economic development of India. These industries account for 95 per cent industrial units, contributing up to 40 per cent of GDP and 45 per cent of total exports. They are the second largest employers of human resources after agriculture. The scope of this sector is vast as individuals with entrepreneurial spirit but limited resources always have before them the option of initiating a business plan at the grass root level. Small �rms are reactive comfortably and more quickly to the changes in the environment. They enthuse innovation and bring into lime light new products, new methods and new ideas. S m a l l B u si n e ss is t h e s e e d b e d o f entrepreneurship. It provides an easy path for the novel entrepreneurs who wish to try their skills and wisdom to start a new venture. They have their own advantages over larger businesses. They are substantial generators of employment, and can act as shock absorbers during a catastrophic situation, responding veritably to topsy-turvy in the market. With not a complicated hierarchy, decision making is ea s y and simpler and so the ma r ket expectations can be ful�lled. They cater to provide services and a wide range of products at a�ordable prices to the consumers. This contribution is despite the sector being exposed to intensi�ed competition since liberalization of Indian economy in 1991. Small industry in India has been confronted with an increasingly competitive environment due to: (1) liberalization of the investment regime in the 1990s, favoring foreign direct investment (FDI). (2) the formation of the World Trade Organization (WTO) in 1995, forcing its member-countries (including India) to drastically scale down quantitative and nonquantitative restrictions on imports. (3) domestic economic reforms. The cumulative impact of all these developments is a remarkable transformation of the economic environment in which small industry operates, implying that the sector has no option but to 'compete or perish'. With the advent of planned economy from 1951 and the subs equent pol i c i e s by the Government of India, both planners and the law makers earmarked a special role for SMEs in the Indian economy. Due protection was accorded to both sectors, and particularly for small-scale industries from 1951 to 1991, till the nation adopted a policy of liberalization and globalization. The development of small industries is instrumental in veering the direction of industrialization to rural areas. The fact that these industries are labour-intensive and utilize less capital triggers the countries employment and supply of manpower in the rural areas. They contribute towards a better utilization of local resources and skills which may otherwise remain unde�led and might have tarnished eventually because of lack of exposure. It is a means of preserving our culture by means of encouraging people engaged in the handicrafts and �ne arts. Apart from improving standards of living by increasing the per capita income, these units hereby, assist in equitable distribution of income among the people. The sector helps the country to alleviate the generic living conditions of the people by overcoming the stigma of poverty and SME Carving Out a New Economy unemployment. One of the chief thrusts of SMEs is to regulate and provide a platform to the vulnerable groups of the society as the main drivers and empower the women and the youth to start their enterprises. Small enterprise promotion has continued to remain an important and integral part of Indian development strategy well before the First FiveYear Plan. However, the sec tors faces unforeseen challenges. Some of the most persisting constraints facing the sector, dominated by smaller units in the informal sector, include poor or non-availability of loan �nance, low levels of technology, inadequate physical and economic infrastructure and resources to invest in quality search and adopt new technology, and a policy of product reservation for small scale industries. Poor monitoring of implementation and e�ect of various small �rm policies has been an issue of concern. The larger enterprises o�er a sti� competition to the small scale units in the sale o f o u t p u t. Ap a r t fr o m t h e s e m a j o r impediments, the sector faces a number of other problems like ine�cient management, non-availability of cheap power, burden of local taxes, shortage of working capital and lack of demand for the products. The list is endless. SMEs have emerged as a vibrant tier of the economy as they have already taken over as key contributors to country's GDP. The new shout out is the Make in India Campaign. Owing to the launch of �agship Make In India Campaign, Prime Minister Narender Modi has given way to a new national program designed to facilitate investment, cultivate innovation , augment pro�ciency in skill development, protect intellectual property and build Best-in-Class manufacturing infrastructure, there has never been a better time to make in India. India's small and medium-sized industries can play a big role in making the country take the next big leap in manufacturing. India should be more focused towards novelty and innovation for these sectors. The government has to chart out plans to give special sops and privileges to these sectors. As clearly seen, the hindsight and the future vision of SME's cannot be simply considered a smaller version of their larger counterparts as they have di�erent managerial styles, scale of operations, levels of independence and decision making characteristics. However these di�erences do not eliminate the opportunities of SME's to internationalize and gain �ight in the global market. SME sector development will continue to spread its wings and be an integral part of the development thrust and promote the entrepreneurial culture. “

40 | B W BUSINESSWORLD | 03 June 2023 WHAT MAKES ICONIC, ICONIC Whether it is mascots such as Amul Girl, Nirma Girl, Onida’s Devil or Air India’s Maharajah or taglines that have withstood the test of time, longevity is an important sign of a great idea By Noor Fathima Warsia OR ANY BRAND, one of the biggest endeavours is to create something that resonates with people. The message or the work should be able to attract attention, retain it, and make consumers the brand ambassadors in turn by talking about it or sharing it or referencing it but most importantly, the work should be able to withstand the test of time. More often than not, there is the tendency to ask creative leaders ‘What is the new thing your brand has done?’ or ‘We are seeing the same thing for ages, isn’t it time to change?’. In a cutthroat world, this obsession to find ‘something new’ or ‘something fresh’ forgets one of the ageold needs of long-lasting brands, which is creative assets that can live and breathe a life of their own. Globally, just like Nike has its swoosh or McDonald’s has Ronald, India too has had the Amul Girl or the Maharajah that have confidently represented their brands for decades. What is it that makes them relevant irrespective of the generation, the changes in the media landscape and competition coming even from the likes of artificial intelligence? If we take the Amul Girl as a case in point, the first thing that stands out is the simplicity and the ability to stay ‘present’. Whether it is the way she is or the comments that accompany her in the different ad platforms giving a take on a current scenario, she can make people of all ages smile. Amul did not change her or her brand of commenting at any point in the search for something different. On the contrary, the brand took a chance and backed their Amul Girl all the way. This was perhaps also Amul’s way of doing things. As can be seen in its taglines, ‘Amul, the Taste of India’ or ‘Utterly Butterly Delicious’. Why fix something, when it aint broken? It is also true though that whether it is Amul Girl or Onida’s Devil, these mascots could connect with real human emotions. They could find their place in pop culture, so much so that they broke into conversations that may have absolutely nothing to do with the brand itself. These brand assets live their own life and it is not shackled. ‘Utterly, butterly…’, for example, need not be there every time Amul Girl is sharing her viewpoint. The brand guide is not a rigid rule book, which when not followed will challenge its very existence. Icons are not just great ideas but also a brand’s vindication that their presence will attract consumers’ long-term loyalty. It will create a sense of co-ownership that needs the brand to let go of some control. Doing something new every time is not necessarily a sign of genius but continuing a good idea that worked, is. F Noorings [email protected]

03 June 2023 | B W BUSINESSWORLD | 41 What kind of impact is Tredence making as a data science and AI solutions provider? Tredence is a data science and AI solutions provider focused on solving the last-mile problem in AI. Completing the “last-mile” of AI means translating data and insights into tangible actions driving business outcomes. We provide speed to value with deep industry and functional expertise, unlocking new opportunities in our customers’ businesses. We offer speed to scale via our partnerships with hyperscalers, data and AI companies. Our 2000+ Tredencians provide valuable expertise and vertical solutions that help our clients make better decisions and win in the marketplace. In 2022, we secured $175 million in Series B funding from Advent International. This will enable us to deepen our vertical and domain expertise, expand operations across Europe and the Middle East, drive inorganic growth through acquisitions, develop a channel partner programme, and improve operational efficiency. We want to use these resources to solve challenging problems and help customers realise faster value from their investments. In 2022, we achieved 100 per cent growth, thanks to our innovative solutions and strong ecosystem of partnerships. We believe the best is yet to come. Please elucidate on Tredence’s ethos of innovation. Tredence’s success is rooted in our focus on innovation and customer impact. We invest about 8-10 per cent of our revenue in R&D and have 100+ data scientists and engineers working on our co-innovation platform. Our ethos delivers significant revenue impact and transforms mission-critical cost centres into profit hubs. It is guided by the following four key principles. • Customer goals are at the forefront of our innovations: We start with our customer’s desired outcomes and work backwards, creating the AI-driven behaviours and insights that yield them. Our vertical-first approach converges experts from domains, data science, and consulting. • We zoom out as we zoom in: We define and solve complete problem spaces instead of isolated challenges, setting our customers up with solutions delivering ongoing value. After deploying, customers move fast to scale capabilities and add use cases creating a cascade of cost savings and revenue streams. • Our innovation methodology is agile: We co-innovate with customers, using a build-fast, continuous experimentation approach. Eliminating subpar approaches faster, we optimise solutions sooner and get customers more invested in adopting innovative solutions to achieve near-term return on investment (ROI). • We are force multipliers: Tredence provides an ecosystem of people, platforms, partnerships, and business-ready solutions. Fortune 100 companies can customise our prebuilt models, typically speeding time to value by 60 per cent or more. Any new developments that Tredence is focusing on? In the coming months, leaders will require that generative AI be incorporated into complex workflows and eventually democratise AI within enterprises. Tredence is collaborating with top-tier hyperscalers to develop these capabilities, bringing new levels of transparency, automation, and decision-making precision. “Tredence’s success is rooted in our focus on innovation and customer impact” Shashank Dubey, Co-founder and Chief Revenue Officer, Tredence In an exclusive interaction, Shashank Dubey, Co-founder and Chief Revenue Officer, Tredence talks about how the company is helping clients make better decisions, transforming cost centres into profit hubs, and focusing on democratising AI within enterprises By Team BW IN CONVERSATION

42 | B W BUSINESSWORLD | 03 June 2023 I ndia’s domestic aviation sector is caught between a strong headwind and a coursechanging crosswind. Already reeling under high fares on key domestic routes as a result of Go First cancelling a major bulk of its flights, it has to now contend with the legal spat involving the ultra-low-cost airline and the National Company Law Tribunal (NCLT) on one hand, and the airline’s lesser and creditors on the other, which threatens to have a long-term fallout for the sector as a whole. The Story Thus Far The troubles of the Wadia Group promoted Go First came to light on May 2 when it filed for voluntary insolvency proceedings before the NCLT and startNCLT’s decision to admit the voluntary insolvency petition of Go First has raised concerns among lessors and creditors about risks associated with aircraft leasing in India and the fallout on air travelers By Ashish Sinha EXPERIENCING TURBULANCE INDEPTH AVIATION

03 June 2023 | B W BUSINESSWORLD | 43 ing cancelling flights beginning May 3. In its plea, Go First blamed Pratt & Whitney (P&W) for ‘faulty’ engines as the reason why nearly half its 54 Airbus A320neos had to grounded. P&W, a part of Raytheon Technologies, has dismissed the airline’s claims as baseless. Admitting Go First’s plea on May 10, the NCLT in an interim order granted relief to the airline, imposing a moratorium on the airline’s financial obligations. This meant that the lessors of Go First would not be able to take possession of the aircraft which are on lease. Expectedly, lessors have vehemently opposed the NCLT’s interim order as they seek to repossess their planes. In fact, at least three aircraft lessors have challenged the insolvency. They have sought to re-possess aircraft and export or re-lease the planes to other functional airline operators. The protection granted to Go First has also sparked international ire. Within hours of the NCLT order, aircraft lessor SMBC Aviation Capital moved the National Company Law Appellate Tribunal (NCLAT) against the ruling. As per reports, other lessors, like Narmada Aviation Leasing, Yamuna Aviation Leasing, GAL MSN, and GY Aviation Lease, have also opposed Go J. PADMANABHAN, Senior Director - Consulting, CRISIL Market Intelligence and Analytics “The short-term impact would be an increase in airfares, also the passengers who would have booked their tickets early on would face some issue in getting revised tickets at similar prices” Photograph courtesy: Wadia Group

44 | B W BUSINESSWORLD | 03 June 2023 NILAYA VARMA, Co-founder & CEO, Public Policy Realization, Primus Partners “The perception of India as a high-risk jurisdiction could translate into higher risk premiums to other local airlines” First’s plea and submitted in the NCLT that they wish to file an application under Section 65 of IBC, which deals with fraudulent or malicious initiation of proceedings. However, according to company law experts, while lessors may file objections in the NCLT or NCLAT, they will not be able to take repossession of the aircraft immediately. The lessors, however, have also moved the Directorate General of Civil Aviation, the aviation sector regulator, demanding the deregistration of 45 planes with Go First. Overall, Go First has a fleet strength of 54. Of these, 28 aircraft have been grounded due to engine issues, and 26 are operational. From the publicly reported data, the total liabilities of Go First are Rs 11,463 crore, of which bank dues are Rs 6,521 crore. Of this, Rs 1,300 has been drawn under the government’s emergency credit line guarantee scheme (ECLGS). It has defaulted on Rs 2,660 crore of payments to aircraft lessors and Rs 1,202 crore to its vendors. Pain Points Go First claims that more than 80 per cent of engine failures occurred before the engines completed 5,000 hours of use, with combustor distress being the primary cause. The airline also alleges that P&W has acknowledged the failure of its engines, which has put the engine-maker in a difficult operational and financial situation. The grounding of planes due to engine failures had a significant impact on Go First. The airline reports that 96 per cent of its fleet was available for flying in FY2015, but that number dropped to just 54 per cent in FY2023. As of March 1, 2023, 50 per cent of P&W engines were unavailable for flying, according to the airline. The non-availability of planes and engine failures cost the company Rs 10,800 crore in losses in the form of revenue and additional expenses. Go First claims that it started facing losses and operating with 50 per cent revenue while incurring 100 per cent cost. Due to the grounding of planes and the pandemic, Go First’s losses increased from Rs 1,346 crore in FY 2020-21 to Rs 3,600 crore in FY 2022- 23. The airline’s expenses also increased from Rs 2,250 crore in FY 2014-15 to Rs 5,907 crore in FY 2022-23. Go First states that it had to bear fixed costs related to its grounded fleet, such as lease rentals, aircraft maintenance charges, parking charges, and employee costs, even though the grounded fleet did not generate any revenue. Future Implications Industry watchers have raised concern over the developments. Says Nilaya Varma, Co-founder & CEO, Public Policy Realisation, Primus Partners: “The NCLT’s decision to admit the voluntary insolvency petition filed by Go First has raised concerns among lessors and creditors about risks associated with aircraft leasing in India. The perception of India as a high-risk jurisdiction could translate into higher risk premiums to other local airlines.” “A higher lease rentals for domestic carries and increase in the cost of doing business may imply higher costs being passed onto passengers in the form of high-ticket prices, thereby making it more difficult for Indian airlines to compete with their international counterparts. The ongoing developments will make it more difficult for Government of India to develop GIFT IFSC into a leasing hub,” adds Varma. Agrees Jagannarayan Padmanabhan, Senior Director - Consulting, CRISIL Market Intelligence and Analytics. “The short-term impact would be an increase in airfares also the passengers who would have booked their tickets early on would face some issue in getting revised tickets at similar prices,” says Padmanabhan. In the medium term, however, the choices for passengers may get limited and that could sometimes lead to irrational pricing or the inability of airlines to cater to a sudden surge Air fares may increase Aircraft lessors & creditors concerned May lead to higher risk premiums to local airlines AIRLINES IN TROUBLE Implications INDEPTH AVIATION

03 June 2023 | B W BUSINESSWORLD | 45 ticular airline,” says Banerjee. He is optimistic about the continued growth of the aviation sector. “The growth in air travel going forward will be aided by improving affordability and rising aspiration levels to travel by air, besides growing demand for tourism. Likewise, on the supply-side, favourable government policies, which have resulted in improved connectivity levels between cities through development of new airports and modernisation of existing airports will also contribute to the growth in the sector,” he says. Lessons Learnt? What can the aviation sector learn from Go First’s experience? Padmanabhan of CRISIL lists a few of the lessons that should be learnt by all in the aviation sector. “Having water tight contracts is of paramount importance. Also, the airline business needs deep pockets and hence the need to be supported by investors/ sponsors who can weather business cycles,” says Padmanabhan. Aircraft leasing has the potential to offer big opportunity for the government, Currently, Indian airlines are compelled to finance their leases through other countries such as Ireland, Singapore, Hong Kong who provide an ecosystem which fulfills their needs such as strong financing, faster aircraft repossession and redeployment and provision of maintenance and operations activities. Leasing internationally implies Indian funds are redirected abroad which is another factor that should drive the government to take the necessary steps to establish a thriving leasing ecosystem in India, says a report by Primus Partners. Also, as per the report, there is a dire need to streamline processes and the regulatory environment, with Gujarat International Finance Tec-City International Financial Services Centre (GIFT IFSC) possessing sufficient potential to become the face of aircraft leasing in India. “Several tax and leasing reforms have ensured a strong foundation which is brimming with opportunity, says Varma. Will the government take note? [email protected]; @Ashish_BW in demand. “Competition helps in product innovation and to think out of the box to attract and retain customers also from a service stand point of view could be a limiting factor,” Padmanabhan adds. Overall, experts say the Indian aviation sector growth will continue year after year. However, it does raise a few questions for the allied sectors like Maintenance, Repair and Overhaul (MRO); setting up a base for aircraft leasing companies may also receive a setback.” All these initiatives could see a temporary setback as the investors would like to see stability in operations of the airlines before sinking in capital,” says Padmanabhan. Regional Connectivity Regional connectivity, experts say, could get impacted as the need to serve the demand from the more profitable metro sectors may lead to a temporary pause in expansion to regional routes. Also, the risk premiums for Indian air carriers can get repriced leading to a strain on the cost side, experts point out. Suprio Banerjee, Vice President & Sector Head - Corporate Ratings, ICRA, however, has a different take. He says, the movement of fares primarily depends upon the movement in ATF prices as well as the ability of the airlines to pass on such a rise in costs. “It also depends on the overall demand-supply situation in the industry. The passenger load factors and the pricing power an airline can command over its competition will eventually determine the trajectory of fares for a parSUPRIO BANERJEE, Vice President & Sector Head - Corporate Ratings, ICRA “The growth in air travel going forward will be aided by improving affordability and rising aspiration levels to travel by air, besides growing demand for tourism” Cost of doing business may increase It is difficult for Indian carriers to compete with international airlines

46 | B W BUSINESSWORLD | 03 June 2023 HE WADIA GROUP is a prominent Indian conglomerate with interests in textiles, real estate, FMCG and aviation, among other sectors. The recent announcement by the group’s aviation arm, Go First, to undergo voluntary insolvency under the Insolvency and Bankruptcy Code (IBC) has generated significant interest in the market. It would be the first voluntary insolvency application, more so from a large wealthy promoter-led business group. ed to file for insolvency under the IBC to initiate a resolution process that could potentially revive the airline’s fortunes. The NCLT’s admission of the insolvency petition is a significant milestone for Go First, as it opens up the possibility of a resolution plan that could help the airline survive. The decision by Go First to opt for voluntary insolvency under the IBC has been viewed by some market analysts as a sensible move given the challenges faced by the aviation sector due to the pandemic. They have saved themselves the perceived - ignominy of their debtors taking them to insolvency, something that could have hurt the image of their larger enterprise –thus demonstrating the changing thinking of Indian promoter-led businesses. But the benefits of Go First’s decision to initiate voluntary insolvency proceedings extend beyond the company itself. The move is also expected to have positive strategic outcomes for the larger Wadia Group. By taking decisive action to address Go First’s financial challenges, the Wadia Group has demonstrated its commitment to protecting its subsidiaries and ensuring their long-term viability. Moreover, by taking control of the insolvency proceedings, the Wadia Group has been able to protect its interests and avoid a potentially messy and costly insolvency process. This could help the group maintain its reputation and financial stability, while also preserving its relationships with key stakeholders such as creditors, suppliers, and customers. The voluntary insolvency framework provides a mechanism for companies to restructure their debt and operations while protecting the interests of stakeholders. By initiating the process voluntarily, the company can maintain control over its assets and management and work towards a resolution that is in the best interests of all parties involved. This could also ensure the stability of the other lines of business that they operate within their group. However, others in the market may perceive the move as a reflection of the Wadia Group’s corporate framework in India. The group has been known to have a conservative approach to debt and has been cautious about taking on excessive leverage. The decision to opt for voluntary insolvency could be seen as an acknowledgement of the challenges faced by the group’s aviation business and the need to address them T INSIGHT Go First’s Voluntary Insolvency By Srinath Sridharan A Change in Societal Thinking While the move may be seen as a strategic decision to deal with the impact of the pandemic and issues of aviation engine troubles that it has been struggling with, it is likely to test the market’s perception of voluntary insolvency and the Wadia Group’s corporate framework in India. The recent admission of Go First airline’s voluntary insolvency by the National Company Law Tribunal (NCLT) is yet another indication of the effectiveness of the Insolvency and Bankruptcy Code (IBC) in India. The IBC, which was enacted in 2016, was aimed at streamlining and expediting the resolution of corporate insolvency in India, and it has been a game-changer in the country’s corporate governance landscape. The company’s management decidPhotograph courtesy: Wadia Group

03 June 2023 | B W BUSINESSWORLD | 47 a robust market for distressed assets, which has attracted a wide range of investors, including private equity firms and distressed asset funds. However, the implementation of the IBC has not been without its challenges. One of the key issues has been the lack of capacity among the insolvency professionals and the infrastructure required to support the resolution process. The code also faces the challenge of balancing the interests of various stakeholders, including creditors, shareholders, and employees. The recent amendments to the IBC, including the introduction of the pre-pack insolvency resolution process, aim to address some of these issues and make the resolution process more efficient and effective. Voluntary insolvency is a unique concept in the IBC, which enables a debtor to admit its insolvency and seek the appointment of a resolution professional to oversee the resolution process. This framework is particularly significant because it provides a mechanism for corporate debtors to take control of their own insolvency proceedings, rather than wait for crediIBC, a Context The IBC has been a much-needed reform for India’s corporate sector, which was previously saddled with a cumbersome and ineffective legal framework for dealing with insolvency. The IBC provides a comprehensive legal framework for the resolution of insolvency, with clear timelines and procedures for all parties involved. The code empowers creditors to initiate insolvency proceedings against defaulting companies, and provides for the appointment of insolvency professionals to manage the resolution process. One of the key strengths of the IBC is its emphasis on time-bound resolution. The code requires that the resolution process be completed within 180 days, with an extension of 90 days in exceptional cases. The IBC has also created The writer is author of Time for Bharat, a policy researcher & a corporate advisor Voluntary insolvency is a unique concept in the IBC, which enables a debtor to admit its insolvency and seek the appointment of a resolution professional to oversee the resolution process. This framework is particularly significant because it provides a mechanism for corporate debtors to take control of their own insolvency proceedings, rather than wait for creditors to initiate the process through a formal process. Challenges of social imagery, especially in the corporate circles is critical. Insolvency has traditionally been seen as a social stigma in India. The societal acceptance around accepting failure in one business unit of a promoter and that business owner continuing with the other lines of business has been low. The traditional view in India is that insolvency reflects a failure on the part of the company’s management and a lack of responsibility towards its creditors and stakeholders. However, this perception is changing, and voluntary insolvency is increasingly seen as a viable option for companies facing financial difficulties. tors to initiate the process. By taking steps to address financial difficulties and restructure their operations, companies can emerge stronger and more competitive, creating new job opportunities and contributing to economic growth. The voluntary insolvency framework also tests the corporate governance framework in India. It is an opportunity for companies to demonstrate their commitment to good corporate governance practices by taking responsibility for their financial difficulties and seeking professional help to resolve the situation. This can help build investor confidence in the Indian market and improve the overall corporate governance framework in the country. However, the success of the voluntary insolvency framework will depend on the effective implementation of the IBC and the willingness of corporate debtors to take advantage of the framework. The government and regulatory authorities need to create awareness about the benefits of the voluntary insolvency framework and provide support to companies that choose to use it. Photograph by 89Stocker/Canva

48 | BW BUSINESSWORLD | 03 June 2023 INTERVIEW HARSH MARIWALA, Founder & Chairman of Marico takes pride in the fact that innovative business practices have powered the company’s growth. In an interview with BW Businessworld, he holds forth on innovation and other life lessons By Suman K. Jha

03 June 2023 | B W BUSINESSWORLD | 49 IN ITS QUEST to become a $5 trillion economy, and then a high-income country, entrepreneurs and a national culture of innovation will play a key role. Marico Founder and Chairman, Harsh Mariwala, who swears by a culture of innovation, is convinced that entrepreneurs can be created – and “there are not necessarily only born-entrepreneurs”. Mariwala is encouraged by a growing number of entrepreneurs coming from Tier-II and Tier-III centres, as also with the growing tribe of first-generation entrepreneurs. In India’s rapidly-expanding startup ecosystem, 49 per cent of startups come from Tier-II and Tier-III centres, according to government data of August 2022. On innovation index, too, India has moved up the ladder, and was at the 40th spot in the Global Innovation Index, 2022. “I found innovation as a way to succeed. I tried this early in my working life. Launches like Parachute and Saffola Masala oats were driven essentially by a philosophy of innovation,” says Mariwala. Having taken his first steps in the world of business in 1971, Mariwala founded Marico in 1990. Marico recorded a turnover of $1.3 billion in FY 2021-22. The home-grown FMCG major posted a growth of 18.67 per cent in the fourth quarter of FY23.It was in 2014, that Mariwala let professionals run the company, where his “CREATE MORE ENTREPRENEURS, MAKE INDIA INNOVATION CAPITAL” MARIWALA’S ‘TEN MILESTONES’ Source: Harsh Realities: The Making of Marico 1. ‘Distancing from the Licence Raj’ 2. ‘Modernising a traditional product - Coconut oil’ 3. ‘Founding Marico, convincing a large joint family to carve out separate companies for younger members’ 4. ‘Building company culture as a source of competitive advantage’ 5. ‘Betting on hair oil’ 6. ‘Choice of portfolio identifying categories that afforded Marico a ‘right to win’ ‘ 7. ‘Setting up a factory in Kerala’ 8. ‘Investing in Bangladesh’ 9. ‘From products to services, adopting cutting-edge innovation’ 10. ‘Pioneering move in succession planning’

50 | BW BUSINESSWORLD | 03 June 2023 family and he own 59 per cent stake. Succession planning comes for a major discussion in his book, Harsh Realities: The Making of Marico, co-authored with management guru, Ram Charan. Mariwala now spends his time guiding the management with his “mind on, hands off” approach, as he also steers the Marico Innovation Foundation, founded two decades ago, and initiatives in the field of mental health and well-being. “When you decide to become an entrepreneur, there are bound to be setbacks. It’s perfectly okay to fail. Failures lead to learnings. As an entrepreneur, you should aspire to, and you should be able to do something that no one has done before. So, grit is very important. Then, an education and a lifelong curiosity to learn is equally important. No one can afford to think that ‘they have arrived’ and put a stop to the process of learning,” says Mariwala, by way of his advice to young entrepreneurs and startup founders. “One cannot stop reading, for instance. One learns everywhere – in the market place, from customers, from the Internet and so on,” he says. Mariwala therefore counts “humility” as an important trait in successful entrepreneurs. With disruptions due to technology, AI, pandemics, and geo-political situations, one must always be on the lookout for opportunities, and always be mindful of global trends that may impact India, too. “Whether it’s organics or natural cosmetics, one should be able to spot the right opportunity. One should always build a business according to their strengths,” says Mariwala. “There must not be any shortcuts. Compliances are important,” he adds. He lists other characteristics that should define new-age entrepreneurs. “One must have the ability to graduate from doing things oneself to getting things done by teams. Plus, negotiations are important. Skilled negotiators create win-win propositions for all,” he says. He also says that risk-taking is crucial. Mariwala is upbeat about the Indian economy. “India is in a sweet spot. Fiscal deficit and inflation are under control. The China factor has helped India. The government has undertaken a series of reforms. But there was also a pause. We need to pursue reforms in the areas of land, labour, ease of doing business, and also judicial reforms”. Mariwala has a vision for Marico. He wants the company to be respected by all stakeholders, and not just shareholders. On a personal note, Mariwala, who has had an illustrious life as an entrepreneur, leader and innovator, would like to be remembered on how he impacted and touched lives, in his corporate world, and outside. After his book Harsh Realities: The Making of Marico, Mariwala now plans a series of thought leadership op-eds. MARIWALA’S EIGHT MAXIMS Source: Harsh Realities: The Making of Marico 1. Leveraging strengths. ‘75 per cent of one’s efforts should go into reinforcing strengths, and 25 per cent into overcoming weaknesses’ 2. ‘Be focused, do a few things’. Focus leads to depth. And depth leads to excellence. 3. ‘Take risks’. Out of failure comes learning. 4. ‘Evolve your vision’ 5. ‘Aim for win-win negotiations’ 6. ‘Reinvent yourself periodically’ 7. ‘Purpose in life is important’ 8. ‘Passion + Perseverance + Determination = Grit. This is important for SUCCESS’ INTERVIEW