Title: India Branding For Global Competitiveness

Author : Vikas Gulia

MBA Student, Department of Business Administration

National Institute of Technology

Kurukshetra

Email id : vikasguliared@gmail.com
 ABSTRACT

Brand India is a phrase used to describe the campaign India is using to attract business.
Basically the campaign is to project the attractiveness of India as an emerging destination for
business in the fields of service sector, manufacturing, information
technology, infrastructure, and information technology enabled services, etc. The campaign
uses both India as huge market for products and services as well as a lucrative destination for
investment. The federal government is spearheading the campaign with considerable
cooperation from the domestic business body Confederation of Indian Industry (CII).

Amongst the leading organizations working on building Brand India is India Brand Equity
Foundation (IBEF), a public-private partnership between the Ministry of Commerce and
Industry, Government of India, and the Confederation of Indian Industry. It aims to
effectively present the India business perspective and leverage business partnerships in a
globalising market-place. IBEF’s primary objective is to promote and create international
awareness of the Made in India label in markets overseas and to facilitate the dissemination
of knowledge of Indian products and services.

India, today, is well established as a credible business partner, preferred investment

destination, rapidly growing market, provider of quality services and manufactured products;
and, stands on the threshold years of unprecedented growth.
India's Talent, Markets, Growth and Opportunity drive Brand India. IBEF works with a
network of stakeholders – domestic and international – to promote Brand India.

This paper explores the strength of Indian products and industries on the global level and how
‘Made-in-India’ brand gets stronger.
Key Words: Brand India, Confederation of Indian Industry (CII), India Brand Equity
Foundation (IBEF)
 INTRODUCTION

A brand is a symbol embodying all the key information about a product or a service: it could
be a name, a slogan, a logo, a graphic design. When the brand is mentioned, it carries with it
a whole series of associations in the public mind, as well as expectations of how it will
perform. The brand can be built up by skilful advertising, so that certain phrases or moods
pop up the moment one thinks of the brand; but ultimately the only real guarantee of the
brand’s continued worth is the actual performance of the product or service it stands for. If
the brand delivers what it promises — if it proves to be a reliable indicator of what the
consumer can expect, time after time — then it becomes a great asset in itself. Properly
managed, the brand can increase the perceived value of a product or service in the eyes of the
consumer. Badly managed, a tarnished brand can undermine the product itself.

So can India be a brand? A country isn’t a soft drink or a cigarette, but its very name can
conjure certain associations in the minds of others. This is why our first Prime Minister,
Jawaharlal Nehru, insisted on retaining the name “India” for the newly independent country,
in the face of resistance from nativists who wanted it renamed “Bharat”. “India” had a
number of associations in the eyes of the world: it was a fabled and exotic land, much sought
after by travellers and traders for centuries, the “jewel in the crown” of Her Britannic Majesty
Victoria, whose proudest title was that of “Empress of India”. Nehru wanted people to
understand that the India he was leading was heir to that precious heritage. He wanted, in
other words, to hold on to the brand, though it was not a term he was likely to have
employed.

For a while, it worked. India retained its exoticism, its bejewelled maharajahs and
caparisoned elephants against a backdrop of the fabled Taj Mahal, while simultaneously
striding the world stage as a moral force for peace and justice in the vein of Mahatma Gandhi.
But it couldn’t last. As poverty and famine stalked the land, and the exotic images became
replaced in the global media with pictures of suffering and despair, the brand became soiled.
It stood, in many people’s eyes, for a mendicant with a begging-bowl, a hungry and skeletal
child by his side. It was no longer a brand that could attract the world.

Today, the brand is changing again. As India transforms itself economically from a
lumbering elephant to a bounding tiger, it needs a fresh brand image to keep up with the
times. The Government even set up, with the collaboration of the business association the
Confederation of Indian Industry (CII), an India Brand Equity Foundation. They were tasked
with coming up with a slogan that encapsulated the new brand in time for the World
Economic Forum’s 2006 session in Davos, where India was the guest of honour. They did.
“India: Fastest-growing free market democracy” was emblazoned all over the Swiss resort.
Brand India was born.

Amongst the leading organizations working on building Brand India is India Brand Equity
Foundation (IBEF), a public-private partnership between the Ministry of Commerce and
Industry, Government of India, and the Confederation of Indian Industry. It aims to
effectively present the India business perspective and leverage business partnerships in a
globalising market-place. Its website (www.ibef.org) is a resource centre for global investors,
international policy-makers and world media seeking updated, accurate and comprehensive
information on the Indian economy, states and sectors. IBEF regularly tracks government
announcements in policy, foreign investment, macroeconomic indicators and business trends.
India Brand Equity Foundation is a Trust established by the Ministry of Commerce with the
Confederation of Indian Industry (CII) as its associate. IBEF’s primary objective is to
promote and create international awareness of the Made in India label in markets overseas
and to facilitate the dissemination of knowledge of Indian products and services. Towards
this objective IBEF works closely with stakeholders across government and industry.

IBEF (India Brand Equity Foundation) invites us to Experience India!

Role of IBEF:

1. Brand Development: Working with stakeholders from across a wide spectrum of

business and academia, IBEF follows a consultative and inclusive process in
developing contemporary global business brands for India Inc.

India fastest growing free market democracy is representative of the

emergent realities in business and industry. At the same time, it also
conveys a cohesive and unifying message about India's
competitive advantage, one that most people easily identify with. The brand portrays
the distinctive qualities of all things Indian and has the dynamism to build an enduring
reputation in the competitive global arena.
 This is India in the 21st century. Rapid all round growth…Globalisation… Leading
on the Strength of Intellectual Capital and the unbridled Spirit of
Entrepreneurship...Democracy… the Permission and Right to be Different… the
Synthesis of Structure and Non-linearity… that together fuel the Quest for Knowledge
and provide the Impetus to Growth.
• 8% GDP growth in fiscal 2009-10
• Foreign exchange reserves of over US$ 284 billion
• Fastest growing population of workers and consumers
• Fastest growing telecom market
• Huge investments in infrastructure development
• Leadership in knowledge-based industries.

2. Research and Publication: IBEF produces a wide range of well researched

publications focussed on India's economic and business advantages. These provide
decision makers with relevant, detailed information on opportunities and successes,
and help them benchmark India against competing business destinations and leverage
the India Advantage to their benefit.

LITERATURE SURVEY

Gone are the days of yore when India was kn1own as the land of snakes and snake charmers,
of tigers and elephants, of ancient tribes and even more ancient customs. The world sees
India today as a fast growing and even faster developing nation that has made quantum leaps
in the fields of technology, science, sport, tourism, health, and entertainment alike, holding its
own on the global scene. The journey towards becoming a global powerhouse is actually the
outcome of conscious choices that we have made in the sphere of economic & social policies.
Some of the milestones in the journey are quit spectacular. We have become the World
largest producer and consumer of variety of industrial and agricultural products. Many Indian
companies winning international recognition for manufacturing excellence, and in
Information technology. India has become a brand to reckon within less then 15 years, India
has transformed itself in to the hottest emerging market; India now seems destined to regain
its old legacy. The world is now looking at a resurgent India, an economic and military
powerhouse striding firmly and surely towards its rightful place under the sun.
The future of brand is inextricably linked with future of business & nations. In fact the future
of brands is the future of nations, if it is to be about sustainable wealth creation.
So, is brand India ready for prime time action? The answer is double shaded because India is
on its way to achieving that stature. But, the path to be traversed is still along one& there is
much to do to reach the final destination. But one thing for sure – there is no looking back on
this journey, as in Pepsi’s jingle “Ho Ha India- Aaya India”.
Branding India is not a choice but an obvious necessity. If we don’t do it now, other nations
are going for it for their own strategic advantage we can’t reposition India by focusing on the
achievements of limited number of people & companies, rather steps are needed to grab &
consolidate on the opportunities that might present themselves in the near future.
Branding is a challenging task but what is more challenging is repositioning a brand &
changing the already established perceptions in the mind of consumers. A nation's brand is a
powerful means for value creation and global leadership in this age of globalization and
competition. Actually Branding has been in existence for hundreds of years & has developed
in to a modern concept that can be applied to anything-from products & services to
companies, not for profit concerns & even countries – as we have seen for Singapore, Dubai,
Malaysia & now India. This paper tries to explain the analogy between country and a brand;
it also explains the concept of taking India as a Brand as well as positioning and repositioning
brand India, Metamorphosis of India’s Image, and attempt has also been made to explain the
progress India has made in the key areas like Economy and Business etc. At the same time it
also pinpoints the major impediments in its journey to become a global brand.
This is a conceptual paper based on secondary data available in public domain. This is an
attempt to juxtapose the dispersed information & thoughts for giving a comprehensive picture
of development, current status & challenges for building brand India.
In this paper, following areas has been identified as objectives of this study.
• To look at the Transition in the image of brand India.
• To explore the factors contributing to evolution of India as a brand.
• To study the areas of concern for developing brand India.
Country as a Brand
A country is like a brand because it has a reputation & because that reputation partly
determines its success in the international domain. The ability of each country to compete
against others for tourists, investment, for consumers, for the attention & respect of media
and of other countries is significantly determined by the power & quality of its image.
The idea of country of origin effect- the power of “made in ….” Label to add appeal to
products & services, to create a price premium for them & to stimulate customer loyalty
towards them- is well known .If Mercedes, Bosch, Siemens & Audi weren’t the first &
foremost German brands, it’s hard to imagine that they would enjoy the same prestige.
Country of origin affects far more than goods & services, however: it makes a significant
difference to perceptions of country’s people (as employees, investors, immigrants,
politicians & media stars), of its sporting & cultural endeavors, its political & diplomatic
relations with other countries, its tourism & heritage attractions, its investment offerings, its
media & other intellectual & creative productions. A country’s image impacts virtually every
aspect of its international engagement, & thus plays a critical role in its economic, social,
political and cultural progress. The country’s image is formed over decades & centuries by
the actions & communications of many individuals & organizations. the key figure in brand
management of countries there are six natural channels of national representation which are
known as hexagon where each of six points- people, governance, tourism, investment
promotion, products and culture- add up to a single “idea of the nation” which can drive
performance in many areas of international trade, international relations& cultural & social
exchange. The whole hexagon is needs to be managed, coordinated, driven by a single
strategy and should be put to work for country’s betterment.
Any country will be able to project its image as fair & positive reflecting its present reality
only when they have clear & inspiring leadership from government, all the stakeholders’
shares a common vision of the country’s future & its current identity and they achieve some
harmonization between their actions & communications.
The international audience will only form a coherent & positive opinion of the country if the
majority of the messages they receive are well coordinated, and the people of the country
organized around shared understanding of their national identity and national purpose.
(Simon Anholt, 2007)
India as a Brand
When did we start giving a serious thought to look India as a global brand? Is it when we
won the cricket world cup? Or with Sabeer Bhatia selling out to Microsoft? Or with Sushmita
Sen becoming Miss Universe? Whenever it did, it has gained momentum only in the last few
years. India has graduated from one phone in a town to four mobiles in the household.
Through the 70,s & 80,s Indian groups like Tatas, Birlas, Oberois, Mittals, set up successful
global operations in Africa, South East Asia & the Middle East, building brands in number of
locations. Building a brand is not an overnight affaire; it takes decades of investments in the
globalize environment. India Inc. is finally, on a firm footing, willing to play the global ball
game, and the basic building blocks are in place for the eventual creation of global brands
from India.
India is today the fastest growing economy in the world with a liberalized trade policy, the
third largest stock exchange, a $14 billion IT industry that is growing at 50% p.a., a strong
pool of scientific and technical manpower, and the largest English-speaking population. It is
already the fourth largest economy in the world in terms of purchasing power parity and its
GDP is expected to grow at a rate of 9 percent-plus in 2007-08. GDP growth is estimated at a
stunning 8 percent plus, Foreign exchange Reserves are at over $150 billion, the Stock
Market is going through the roof, a great monsoon has heralded greater growth,
mushrooming malls, improving telecom connectivity, booming software, wellness, and
movie industries, radical economic and strategic pacts with the United States, the European
Union and South East Asia - all point out one thing: India has finally found its own place on
the world map. The tourism sector has risen by 20% this year, while it is predicted that by
2020, tourism in India could contribute Rs.8.5 crore to the GDP, the entertainment and media
industry has risen by 1.5% and is expected to register a 12% CAGR over the next five years.
Add to this, the strategic pacts with the US, the European Union and South East Asia, and
you have an India that is an economic miracle in the making. In addition, the fact that it is the
10th most industrialized economy in the world, and ranks among the top 5 tourist
destinations, a major destination for Venture Capital Funds, and again, an attractive
destination for FDI, and you have an India that instantly commands recognition as an
economic force of the future, and a "Brand" of possibly iconic dimensions. The prominent
areas that India has emerged as a source to reckon with in recent times have been the IT
industry, Tourism, Wellness, Entertainment and Sport. "India Shining" rings true the world
over, as the world is turning towards India as a single-source "Brand" catering to global
requirements in all of the five fields listed above and more. "India now basks in the most
`shining era' in the 56 years since it became independent from Britain", the state-run China
Business Weekly said in its latest issue which focused on India's recent rise as an emerging
economic power. The Indian economy has never had it so good in recent history -and
the country may now be termed as "A Blockbuster in the making", being truly on the fast
development track, predicted to continue to grow at a faster pace over the next several years.
In addition, the long-buoyant private sector is a major driving force behind India's economic
takeoff, and conglomerates have played a significant role in driving the Indian economy.
Informed sources suggest that by 2050, Brazil, Russia, India and China, the BRIC economies,
in short, will be in a position to collectively overtake the G-6. It is predicted that the BRIC's
growth rate will be most dramatic in the next 30 years and the currency of these countries
may appreciate as much as 300 percent against the dollar in the next 50 years. The Indian
economy, in particular, could become the third largest in the world, after US and China, in
the next 30 years.
These predictions are based on the fact that all this can happen only if India does things right
and can be taken as an indication of what India is capable of achieving. India is now on a
high; it is on the right track of becoming a `brand' to the world.
The Marketing Mix of Brand India
Considering India to be a brand, we first need to understand the marketing mix of brand
India.
1. Product: Countries should position themselves as competitive destinations for investments
and tourism. Marketing Brand India needs special focus on core competencies by states. A
synergic attitude can strengthen the brand. India's pharmaceutical industry is 4th largest in the
world. As for technology, India is among the three countries that have built super computers
on their own.
Indian exports were up by 19 percent in 2003, and the country's foreign exchange reserves
are in excess of US$100 billion. India is dishing out aid to 11 countries, prepaying its debt
and loaned IMF US$300 million. Indian Industry is becoming globally competitive in many
sectors such as Pharmaceuticals, Auto Components, IT, Biotech, R&D and ITES. According
to National Council for Applied Economic Research (NCAER) study, the number of middle
and high-income households in rural India is expected to grow to 111 million by 2007. Thus,
the absolute size of rural India is expected to be double that of urban India.
2. Price: A cataract operation costs US$1500 in the US. In India, US$12. Hearts bypass
surgery in the US costs anywhere up to US$13000. In India, it is US$900. Over 70 MNCs
have set up R&D facilities in India in the past five years. Economic indicators with the
exception of the deficit are strong, interest rates are down, inflation is low, exports are
growing (exports have increased to $102,725.1 million in 2006), for-ex reserves in excess of
150 billion and the rupee is appreciating.
Price competitiveness is only one of the factors that are going to make an organization or its
products stand out. But building a brand is all about creating or delivering a kind of
uniqueness, an intangible that just cannot be copied. With the easy availability of technology
and resources every country would like sell itself as a competitive nation. But for India it has
to concentrate more on that intangible to create a nice for itself and stand out when it comes
to countries like China and other Southeast Asian economies.
3. Place: India enjoys the strategic location, the location of India is central in the world but
access is limited to the key economies. Well-developed ports and increasing air routes can
make it possible. The turnaround time in Indian ports is down to 4 days from 10 and its
telecom in 1999 provided a bandwidth of 155 Mbps. Today it is 75,000 times more and with
fibre optic network in 300 cities. MNCs are quite profitable in India and are often earning
returns that are superior to their global average. Many of these companies are doing better in
India than in china. Some are taking full advantage of their operations in India by not only
profitably accessing the domestic market but by also providing low cost off-shored services
to their global operations. India's demographic profile is most advantaged in the world and
will continue to improve. Infrastructure from a very poor base is improving. Apart from the
power sector which is very disappointing.
Telecom, airports, roads and ports all have made progress. The government made a
commitment to improve rural infrastructure in Budget 2005, with an allocation of Rs 18,334
crore towards rural development. Bharat Nirman, a comprehensive rural uplift programme
meant to offer a new deal to rural India, has also been launched. It will focus on development
in six key areas -- irrigation, roads, water supply, rural electrification; housing and rural
connectivity. The substantial increase in the budgetary allocation for the social sector reflects
the government's strong commitment to sustainable development in rural and urban areas.
The combined efforts of the government, private sector, NGOs and private individuals will
surely go a long way in making the world a better place to live in.
4. Promotion: If we have to establish India as a global brand, the communication needs to go
out to the primary audience, the Indian people in this case, all one billion of them. Influences
can be government bodies, media and trade bodies. We need the rest of the world to catch a
glimpse of our strengths. Even is a sample of the population gets to know it, they can spread
the word. We have to include a series of coordinated marketing initiatives that will use
conventional methods like advertising and developing a brand ambassador's network to make
an impact in the long term. We have to plan out innovative measures like bringing select
groups from media houses and educational institutions for structured India tours for long-
term support to brand development. On our domestic front we have to develop a strong
partnership between the representatives of state, select ministries, sectoral associations and
community institutions to drive alignment and coherence in brand communication efforts. For
this we need to conduct workshops, research that helps track perceptions of brand India.
(John Mathew, 2005)
Repositioning Brand India
What is `India' for the world? It is a millennia-old civilization. A billion people speaking,
reading and writing dozens of languages. A land that is the birthplace of Hinduism,
Buddhism, Sikhism and Jainism. It is also the world's premier IT services provider. The
world's back office. Emerging small-car hub. Repository, arguably, of the world's largest
number of engineers, doctors, accountants, and so on. To bring it all down to a single idea,
any single idea, is like calling an ocean a pool of water. India certainly can't just be a brand
you can associate with only one aspect. This does not mean we can't present India to the
world in a simple, cogent manner.
India can and is indeed being presented in different forums across the world. Right now,
corporate CEOs, investment bankers, and seekers of spirituality, health addicts and
holidaymakers, all over the world, are discussing it. (Murari, 2005)
As a priority, India's image in world needs a corporate type analysis of the
market/competition and current status. Culture is an important form of capital and must be
positively positioned as a part of any brand management. Cultural branding should not be
allowed to become a liability under the control of anti-India forces. Yoga and Ayurveda are
examples of positive cultural areas that are now in the mainstream and deserve to be brought
back under the India brand. Two illustrations will show the economic cost of not managing
cultural capital:
Yoga is a multi-billion dollar industry in the USA, with 18 million American practitioners,
$27 billion/year revenues (from classes, videos, books, conferences, retreats), over 10,000
studios/teachers, and 700,000 subscribers to Yoga Journal. However, cultural shame has kept
Indians out of this field, and over 98% of yoga teachers and students in USA are non-Indians.
Ayurveda is a $2 billion/year industry and a part of the high growth international market for
plant medicines. The popular consumer brand, Aveda, was started by an American devotee of
Indian gurus to bring Ayurveda to the West. (Aveda is short for Ayurveda.). (Rajeev
Malhotra, 2003 Rediff news)
Clearly, the economic potential here could be as big as India's software exports, especially if
yoga were included in India's proposed initiative to export health care services. America's
yoga centres are potential retail outlets for Indian culture and brand marketing but culture is
not the only area that needs to be look at while positioning and repositioning India as brand.
India Inc. still remains among the fastest growing economies in the world; the domestic
market across all categories is booming; new jobs are being created & salaries are booming
and the great Indian Outsourcing story is still very much alive. We have considered following
key areas that make brand India even stronger and reposition the image this country deserve.
Indian Middle Class
India’s middle class of over 300 million is bigger than the countries of the UK, Italy, and
France combined. Growing prosperity will make it one of the world’s biggest markets for
everything from cereals to cars.
India’s population isn’t just growing, but getting richer, here are some facts:
• According to Deutche Bank report, India is likely to be the world’s 3rd richest economy
by 2020, with a GDP of Rs 64 lakh crore.
• 544 million Indians will likely join the consuming middle class between 2006 and 2015;
current size estimated at 250-300 million
• FMCG industry will grow to Rs 106,300 crore by 2012 compared to Rs 60,000 crore
now.
• Today, 1.6 million people earn more than $ 100,000 a year; the number grows to 3
million in 2010.
• 41 million Indians have a home loan today compared with only 5 million 10 years ago.
The Outsourcing Boom:
Forget about IT & ITES, India is rapidly emerging as a hotspot for outsourcing
pharmaceuticals products, engineering design, R&D, Clinical research, textiles, even auto
components. Yet, it isn’t only the cost factor that continues to make India an attractive
outsourcing destination. The quality of manpower combined with an extremely sophisticated
vendor base and improvements in local infrastructure have put it ahead of other offshore
destinations.
Key trends in India:
A number of leading software services companies made a foray into the ITES/BPO domain,
either directly, or through the mergers and acquisitions route. Most Indian IT leaders today
such as TCS, Infosys, Wipro, Patni, and HCL among others have a presence in this market.
Analysts are predicting a $50 billion offshore market for high-end processes in 2010 as more
businesses seek the benefits of off shoring. Segments exhibiting maximum growth have been
customer care and administration (growth of over 7 per cent).
Some recent news lines show that the outsourcing boom in India has already started giving
other countries a run for their money.
Zooming Salaries
India Inc. has started spreading the rewards in anticipation of better time to come as well as in
response to the good times that is running. Across levels, an increase in salaries almost
always translates in to corresponding increase in discretionary income. High growth and high
attrition industries such as IT, ITES, telecom and banking & financial services, have
expectedly, clocked the highest increase in salaries. A increase in salaries results in a
consequent increase in discretionary spends of the consumer.

Global Opportunities
India is showing the way to the world. India Inc. is flying high. Not only over the Indian sky.
Many Indian firms have slowly and surely embarked on the global path and lead to the
emergence of the Indian multinational companies.
With each passing day, Indian businesses are acquiring companies’ abroad, becoming world
popular suppliers and are recruiting staff cutting across nationalities. While an Asian Paints is
painting the world red, Tata is rolling out Indicas from Birmingham and Sundram Fasteners
nails home the fact that the Indian company is an entity to be reckoned with.
Some instances
• Ranbaxy is the ninth largest generics company in the world. An impressive 76 percent of
its revenues come from overseas.
• Dr Reddy's Laboratories became the first Asia Pacific pharmaceutical company outside
Japan to list on the New York Stock Exchange in 2001.
• Tata Motors sells its passenger-car Indica in the UK through a marketing alliance with
Rover and has acquired a Daewoo Commercial Vehicles unit giving it access to markets in
Korea and China. World cheapest car was also launched by it.
• Asian Paints is among the 10 largest decorative paints makers in the world and has
manufacturing facilities across 24 countries.
• About 80 percent of revenues for Tata Consultancy Services come from outside India.
Metamorphosis of Brand India:
The far-reaching economic reforms of deregulation and liberalization undertaken by the
government since 1991 have unleashed the enormous growth potential of the economy. From
the low growth of the past the economy has become a high growth one in the long run.
According to Goldman Sachs Report Brazil, Russia, India and China will grow fastest over
the next 30-50 years by leveraging its demographic advantages through continued
development. Some of the findings are as follows:
• By 2050 India’s GDP will amount to 20% of the total GDP of top 10 economies of the
world. Presently India only accounts for a mere 2.5% share.
• As far as projection about market size by 2050, India will stand 3rd after behind China &
USA.
• By 2050 Brazil, Russia, India and China will grow fastest & become a much larger force in
the world economy than they are at present.
• India could be the third largest economy in the world after china & USA.
• India if could maintain its growth rate steady at 5%, by 2032, its GDP will be bigger than
the Japan’s and by 2050 its national income per head in dollar terms will have multiplied 35
fold.
India Inc. -The Journey so far
India Inc. has come a long a way in its journey to become a global brand. In less then 15
years, India has transformed itself in to the hottest emerging market; India now seems
destined to regain its old legacy. The first hypermarket didn’t open until 2001.There was no
Maruti Zen on the road until 1993. The PC penetration was almost nil before 90s and few
knew about multiplex until PVR opened in Delhi in 1997.Since the last decade & a half;
Indian Consumer has gone through a remarkable psychographic shift. The story of consumer
boom is in full swing across all products and service categories. When the 90s decade
opened, The Bombay Stock Exchange bellwether index, Sensex, was at a measly 1,000.There
were just 403 stocks that traded on the Exchange, since than we have come along way and we
are sure that journey will not stop here. In this section, the journey of India Inc.is explained in
terms of the progress we have made in terms of Economy, Business and the blasting
Consumer boom as well as in terms of special moments, India Inc. has enjoyed in the last
decade and a half.
INDIA NOW, BUSINESS AND ECONOMY

o IT, ITES, Biotechnology, Healthcare, Drugs & Pharmaceuticals, Manufacturing,

Power, Infrastructure, Oil & Gas, Automotives, Telecom, Training & Education,
Tourism & Hospitality, Space, Science & Technology, Handicrafts, Patents, R & D,
Financial Services, Food Processing, Real Estate, Cement, Alternative Medicine,
Services, Agriculture, Media & Entertainment, Insurance, Banking, Rural & Urban
Consumption, Advertising, FMCG, Textiles & Garments.
Specified Indian Brands:

Agro Products

Basmati Rice | Castor Oil | Chana | Coffee | Cotton | Crude Oil | Gaur | Gur
| Jeera | Jute | Maize | Mustard | Peas | Pepper | Red Chilli | Rice |
Rubber | Soyabean | Sugar | Turmeric | Urad | Wheat

Crafts Products

Gems and Jewellery

India - Preferred Services and Manufacturing Supplier to the World

Company Outsourcing for

IT Services
Infosys Goldman Sachs, Aetna, Northwestern Mutual, Am Ex, DHL,Verizon
Tata Consultancy GE, Honda, UBS, HSBC
Wipro Transco, HP - Compaq, Nortel, General Motors, CISCO, Sony

IT enabled Services
Mphasis BFL Citi Group, Accenture, Auto Zone, Capital One
Spectramind Dell, American Express, Capital One

Pharmaceuticals
Cipla Ivex, Watson Pharma, Eon Labs
Shashun Chemicals Eli Lilly, GSK Pharma
Lupin Laboratories Apotex, APP, Watson Pharma

Engineering
Bharat Forge Meritor, Caterpillar, Toyota, Ford, FAW (China)
Tata Motors Rover,
Moser Baer Imation, BASF
Essel Propack P&G, Unilever, Colgate.
Made-in-India brand gets stronger

One of the biggest challenges is to start connecting the dots to tell the full story of this
complex brand. What is Brand India doing to build brand equity in this age of globalised
short-attention spans?

The Incredible India tourism campaign has made a mark globally. The India Everywhere
economic campaign hijacked Davos 2006, imprinted India on the minds of the world’s power
elite, and is now ‘on tour’.

So far, few Indian companies, products and brands have made it to global consciousness,
excluding a few special cases like ‘Gandhi’. An example on many Westerners’ minds is
Mittal, but let’s face it, that’s not really an Indian company.

Still, Mittal vs Arcelor brought the concept of ‘the Indian MNC’ to international media,
CEOs and bankers. Indians are coming to get you an M&A closer than you’d like to think.

On the local advertising scene, where we might find future contenders for international
mindspace, local spenders include the likes of Dabur, Bajaj, Paras, and Tata (and,
interestingly, the government of India), and transnational joint ventures like Hero Honda and
Maruti Udyog/Suzuki. And the usual multinational suspects like HLL, P&G, PepsiCo, Nokia
and LG.

Nine years ago, Tata Motors had close to 38,000 employees earning an annual turnover of Rs
10,000 crore (Rs 100 billion). At present, its turnover is Rs 21,000 crore (Rs 210 billion)
earned by 30,000 employees. Its salary cost has dropped to 5.5 per cent of turnover from 10-
11 per cent five years ago.

"The attitude of 'can do' pervades the organisation," says Tata Motors managing director Ravi
Kant. Skill, innovation, productivity and cost efficiency are also the leit motif at other Indian
manufacturing houses, most of which found themselves wobbling when faced with the
challenge of becoming globally competitive in the 1990s – a task made more onerous by the
industrial downturn in the decade's second half.

Mahindra & Mahindra's 5,000 employees churned out 60 vehicles a day in 1994. The
company now has 2,000 employees rolling out 160 vehicles every day with zero overtime.
Essar Steel has constructed the world's second-longest iron ore slurry pipeline of 267 km
from Bailadilla to Visakhapatnam that can carry 8 million tonnes of iron ore a year and bring
down transport costs from Rs 550 to Rs 80 a tonne.

Last year, when Japan's automotive giant Honda Motor expressed an intention to use two
spark plugs in its 100-125 cc motorcycles to reduce engine friction, a cheer went up in the
research and development wing of Bajaj Auto, which claims to be the first to use two spark
plugs in motorcycle engines.

Maruti Udyog Limited, during the three years to 2004-05, cut costs by 30 per cent and
increased productivity by 50 per cent. It has embarked on a similar programme for the next
three years.

These are also companies that have traversed the great distance from the wobbly to the
bountiful in just a few years. Tata Motors made a Rs 500 crore (Rs 5 billion) loss in 2000-
01. It made a profit of Rs 1,236 crore (Rs 12.36 billion) in the last financial year.

Maruti Udyog has moved from a loss of Rs 269 crore (Rs 2.69 billion) in 2000-01 to a net
profit of Rs 853.6 crore (Rs 8.53 billion) in 2004-05.

Mahindra & Mahindra's Rs 512.6 crore (Rs 5.12 billion) profit for 2004-05 marked a steep
climb from just Rs 96.9 crore (Rs 969 million) in 2001-02.

Essar Steel has, between 2002 and 2005, reduced its term debt by Rs 1,100 crore (Rs 11
billion). When the two-wheeler market shifted overwhelmingly from scooters to motorcycles,
it was expected to claim Bajaj Auto as a casualty.

Today, the company is a strong number two in motorcycles with a 36 per cent share of the
market.

As these companies turned around, they also turned economic theory on its head. In general,
economies move from agrarian to manufacturing to services. In the 1990s, it was generally
expounded that India had missed the manufacturing bus.

It remained untouched by the first wave of industrial offshoring revolution, which gravitated
to China, Thailand and other countries in East Asia, helping a vast section of the working
population migrate from agriculture to industry.
India's future, they said, lay in services. This gained credence as agriculture's share in India's
gross domestic product fell to barely 20 per cent from 32 per cent in 1991, and that of
services soared to 52 per cent from 41 per cent.

Industry's share remained flat at 27 per cent and within that, manufacturing's remained
stagnant at 17 per cent. The industrial downturn of 1996-97 doused whatever little hopes
there may have been of a manufacturing renaissance.

However, services are much less efficient in creating jobs compared with manufacturing.
That didn't work for India, 2.5 per cent of whose population is joining the workforce every
year, compared with a population growth of 1.5 per cent.

Says Shirish Sankhe, a partner in consultancy company McKinsey: "Without manufacturing,

India could not grow. Manufacturing is the best avenue to create jobs that may not be very
education-intensive - services need education - and pull people out of agriculture."

There had to be a way to get on to the bus. It could not be done the China way, which was
one of China's high-volume low-cost model, since China had already mastered it. Given its
thrust on special economic zones and flexible labour policy, it would be difficult to upstage.
Why would, say, a Walmart, which sources most of its goods from China, turn to India?

The solution was found in skill-based manufacturing, which increased cost efficiency while
keeping quality high.

Says Baba N Kalyani, "India's strength lies in products that require multiple skills, using
technology to increase productivity," says Baba N Kalyani, chairman and managing director
of Pune-based Bharat Forge.

Over the last five years, the employee cost of Bharat Forge, the world's second-largest
forging company, has dropped from 9 per cent of the turnover to 5 per cent, even as wages
have doubled.

Bharat Forge was an early bird. Starting in 1989, it overhauled its business model to usher in
modernisation. In the subsequent years, a similar wind quietly blew in to other manufacturing
companies, dismissed in the 1990s as "old economy".

This was the time when Indian manufacturing was moving from the doomed low technology-
low capital-cheap labour model delivering "just about" quality to a combination of high
technology, higher capital and a very highly skilled workforce that promised global
competitiveness.

Around this time, the business climate too changed. The country had always had a steady
supply of technical manpower. Interest rates fell from 19-21 per cent to about 10 per cent and
under.

Labour, which used to think of management as the devil's own, began to realise that their
interests were not very divergent after all.

Ten years ago, M&M's Kandivli plant, near Mumbai, had a quota system under which each
worker's actual work time was under 240 minutes a day. Today, every worker puts in 450-
460 minutes a day, excluding the lunch break.

The coming of age of services, especially software, helped. People began to appreciate the
technology-driven business model. M&M got into nuts and bolts, literally, to reduce the time
taken for each activity in terms of seconds.

Its utility vehicle Scorpio, in the beginning, had about 6,000 welding spots. As the company
gained confidence in its product, the number of spots came down to 5,500. Tata Motors' Pune
plant alone has 100 robots. You wouldn't find a soul on Essar Steel's shopfloor, except in the
electric arc furnace.

Even the public sector - whose prime function once upon a time was to create employment -
caught on. In 1998, Steel Authority of India Ltd had 1,77,000 employees and produced 10
million tonnes of steel. Its private sector rivals produced half that amount with a workforce of
just 5,000.

Having spent Rs 12,000 crore (Rs 120 billion) on modernisation, SAIL now produces 13
million tonnes with 1,24,000 employees. Five years ago, SAIL was groaning under a debt
burden of Rs 15,000 crore (Rs 150 billion). It is debt-free now. "We can withstand the
dynamics of the market," says V S Jain, the company's chairman.

Cost efficiency has made it lucrative to do business in India. According to the Confederation
of Indian Industry, the average return on investment in India is over 19 per cent, compared
with just over 14 per cent for China.

That higher return is a reflection of higher value-added manufacturing. M&M spent a mere
Rs 600 crore (Rs 6 billion) on the Scorpio project. "For a multinational doing a similar
project overseas, the cost would be Rs 4,000 crore (Rs 40 billion)," says the company's
president (automotive), Pawan Goenka.

The result is a blow to the old wisdom that in vehicle manufacturing only a very high scale -
Detroit pegged it at 1 million - can ensure profitability. The Scorpio is profitable on sales of
33,000 a year. Macroeconomic data too is beginning to show that Indian manufacturing is
riding a crest, growing at 9 per cent a year, the highest in recent memory.

But more to the point is the changing world attitude. When Ratan Tata had announced Project
Mint, which yielded Indica, in the 1990s, it was greeted with universal scepticism.

Experts thought the project would finally undo the man, whose track record had not been
exactly exemplary. Two years ago when Tata said he would make a car that retailed for
$2,000, the reaction was one of anticipation. The experts wanted to know how he would do it.

And, as the company's vice-president Rajiv Dube points out, no one uses the phrase "old
economy" any more.

Next stage: The world

The once-troubled Daewoo Commercial Vehicles has turned around. Acquired by Tata
Motors two years ago and renamed Tata Daewoo Commercial Vehicles, its net profit
increased three times to Rs 45.8 crore (Rs 458 million) for April-December 2005. It has a 27
per cent share of the South Korean market.

"We cut costs there, just like in India, and increased exports substantially to South Africa,
Middle East and South Asia, where Tata is already an established brand," says Tata Motors'
managing director Ravi Kant.

Kant's explanation, though small, tells a big story - an Indian company acquiring a
multinational and helping it prosper on the strength of cost efficiency and brand development
in India.

India's exports account for just 0.8 per cent of world trade, compared with 6.4 per cent for
China. But its share could quadruple in a decade, according to McKinsey.

"Manufacturing exports from India could increase from $40 billion in 2002 to approximately
$300 billion by 2015, leading to a share of approximately 3.5 per cent in the world
manufacturing trade," says the consultancy.
In part, that will be a result of the downsizing of blue-collar America - such as auto-
component giant Delphi - and the subsequent outsourcing to low-cost countries in a way that
does not increase exposure to China. But a big role will be played by Indian companies that
are making the world take notice of the "Made in India" label.

Close to 5 per cent of Mahindra & Mahindra's turnover now comes from overseas, but it has
been growing at 90 per cent. The company hopes to earn a fifth of its turnover from abroad in
three years. "We have the ambition to become a truly global company," says M&M president
(automotive), Pawan Goenka.

Last year, the company took control of Chinese tractor maker Jiangling, which gave it a
foothold in the world's third-largest market and a low-cost base from which to export tractor
kits to the US. Starting May this year, it will start selling the Scorpio and Bolero in Spain and
Portugal.

Indian automotive component companies have already notched up a number of acquisitions

overseas. Pune-based Bharat Forge, which has made six acquisitions in four countries in the
last two years, has set a target to become the global leader in its business by 2008.

Tata Steel is the world's lowest-cost producer of steel. Hero Honda is the world's largest
motorcycle manufacturer. And Maruti Udyog, in which Japan's Suzuki Motor Corp holds
about 55 per cent of the equity, is slated to soon become bigger than the parent.

Infrastructure remains a constraint in India. Most infrastructure services cost 50-100 per cent
higher here than in China, with Indian manufacturers paying twice as much for electricity and
three times as much for rail freight.

However, according to consultancy firm KPMG, India scores better than either China or
Brazil on business regulation, better than either on the burden of tax and customs
administration, and better than Brazil on the perceived level of corruption.

According to KPMG, many companies have developed effective "workarounds" to deal with
India's infrastructural challenge. For instance, ports are indeed congested. But if you have the
right clearing agents, you can ship cargo.
Neither has yet brought the world a strong global Indian consumer brand. Brand India, in that
context, is a B2B rather than a B2C brand. Some industry sectors play a key role in changing
the perception of India, e.g., pharmaceuticals, medical tourism, manufacturing, e-learning,
creative services, and retail. Levis has their second-largest store in the world and the largest
in Asia, in Bangalore, which is bound to send a strong message.

Look out for local brands with ‘bottom-of-the-pyramid’ propositions successfully combining
very cheap and very useful = very good value, like micro finance or one-sachet products.

Other examples with potential include agri-business, wind power and the space programme.
And NRIs add to the Brand India equity through people like Pepsi’s Indra Nooyi.

There is potential to carefully exploit those ‘soft and mystical’ aspects of India, like yoga and
Ayurveda, e.g., medical tourism and experience-based offerings. Some say these stereotypes
should be avoided since they will keep India’s image in its past. I think real value is being
expropriated by other companies in other countries.

Why let them? On the downside, there are a number of challenges and threats, many being
addressed slowly: poor infrastructure, inclusive growth, states developing at different speeds,
and a reputation of corruption and red tape.

Some of Brand India’s strengths are its democratic system, the sheer number of consumers,
human capital, and not the least, an emerging confidence and sense of opportunity of India
taking its rightful place as a leader in the global economy.

In the 21st century, you have to compete on ideas. A Deutsche Bank advert said, “Ideas are
capital. The rest is just money.” Brand India is an idea at the right place at the right time. The
rest is just history.

Brand India wins against China:

Giving a twist to the much-touted race between the Indian elephant versus the Chinese
dragon, an eminent expert on 'nations branding' says although China's economy may be far
bigger and its military superior, Brand India may just win the game as the world identifies
with its values of plurality, diversity and tolerance.
'Brand China is about enforced conformity. Brand India is about openness and diversity;
every culture and every religion is represented here,' Nicholas J. Cull, a British-born historian
and theorist of public diplomacy, told IANS in an interview during a visit here.

'India is a conversation in which everybody can take a part. Indians are argumentative as well
as tolerant. This is part of India's DNA,' said Cull, professor of public diplomacy and director,
masters programme in public diplomacy, Annenberg School of Communication, University
of Southern California.

Cull cited these salient brand features to pitch eloquently for a permanent seat for India in the
UN Security Council.

'India belongs to the Security Council. I absolutely would like to see India in the Security
Council,' Cull said during his recent visit to India to participate in a seminar on public
diplomacy.

'It's surprising that European powers continue to have seats in the UN Security Council. It's
time that they make way for emerging powers like India,' he said just days before India enters
the Security Council as a non-permanent member for a two-year term after a gap of nearly
two decades.

Cull has authored many pioneering works like 'Public Diplomacy in a Changing World' and
'The Cold War and the United States Information Agency: American Propaganda and Public
Diplomacy, 1945-1989' that tries to reconstruct countries as brands.

Cull contrasts India's style of low-key diplomacy and spontaneous soft power expression with
orchestrated image-building indulged in by China's rulers.

'The truth about China's public diplomacy is that it is for domestic consumption. China wants
to give its people the gift of the admiration of the world,' he said while alluding to the
spectacular 2008 Beijing Olympics which was widely seen as China's coming out party in
influential capitals of the world.

'The Beijing Olympics was designed not to impress you and me, but the Chinese people. It
helped the Chinese elite govern,' he said.
On the contrary, India does so many wonderful things in the world, but keeps quiet about it,
says Cull, while recalling the evacuation of hundreds of Indians stranded in Lebanon in 2006
and the pan-Africa e-network that brings tele-medicine and tele-education to the African
people as shining examples of Indian diplomacy.

India's soft power is immense and will hold the key, predicts Cull.

'As the years go by, India is set to be more influential and powerful in the face-off with
China,' he said.

Providing an insight into why the world by and large feels at ease with an emerging India but
has unease about a rising China, Cull says: 'When they think about India, they think about
good music and films. When they think about China, they don't have the same warmth. I am
basically for India.'

He, however, warns against smugness. Having a strong brand is not enough, Cull argued,
adding that it was important to manage and sustain a brand in public consciousness.

What threatens Brand India? 'When organizations peddle exclusionary ideologies or

tendencies, it undermines the India brand. India should also be vigilant against the
government's tendency to squash opposition and voices of dissent and the widening divide
between the rich and the poor,' he said.

'America is a great brand associated with freedom and democracy. When the US tortures
people without trials, it undermines the brand. When China does it, nobody minds it as it is
seen as a repressive nation with repressive tendencies,' he explained.

Contribution of Indian Industry to the US Economy - An Update

2004-09

As per the findings of the update, Indian industry contributed USD 153 billion to the US
economy and supported as many as 314,000 jobs over the period 2004-2009.

An important highlight of this study has been the role that the Indian industry has played
during the recessionary period of 2008-09. Contrary to conventional belief, where
organisations are considered to defer investment decisions during a slowdown, Indian
corporations have been known to go ahead and commission both greenfield and brownfield
projects in the US. In fact, Indian companies have not only contributed by way of increased
investments in the United States, but also in terms of creation of employment opportunities
for local communities.

Automotive, aviation, gems and jewelry, IT/ITeS, metals and pharmaceuticals are the sectors
where Indian industry has contributed the maximum to the US economy. In particular,
IT/ITeS, aviation and metals stand out.For the sectors under purview, the study reveals the
ability of Indian firms to execute projects under tough economic situations. A good example
is that of the Indian metals sector, which in spite of being a capital intensive industry, has
seen companies operating in this domain commission greenfield facilities in the US.

Conclusion:

What do we want the world to think of when they hear the name “India”? Clearly we’d prefer
“fastest-growing free market democracy” to replace the old images of despair and disrepair.
But surely there are other elements we want to build into the brand: the exquisite natural
beauty of much of our country, encapsulated in the “Incredible India!” advertising campaign
conducted by the Tourism Department; the glitz and glamour of Bollywood and Indian
fashion and jewellery designs; the unparalleled diversity of our plural society, with people of
every conceivable religious, linguistic and ethnic extraction living side-by-side in harmony;
and the richness of our cultural heritage, to name just four obvious examples. Yet it would be
impossible to fit all that into a poster, a banner or even a TV commercial. (And we’d still
have left out a host of essentials, from ayurveda to IT).

So the challenge of building Brand India continues. But one essential fact remains: what
really matters is not the image but the reality. If we can make India a healthy and prosperous
place for all Indians, the brand will be burnished all by itself. Then, and only then, might we
even return to “India Shining”.

References:
“Doing Business Globally-Marketing Brand India” India Trade & Investment Forum, 2009
“India Inc plans new campaign for Davos 2007”Business Standard, Nov, 2009
“India wants the world to see it as it sees itself” International Herald Tribune Oct, 2009
After 'India Everywhere', it is now 'Experience India' Business Standard, August, 2009
Bapna Amit “Brand India Coming of Age” USP AGE Aug 2009.
Bhushan Ratna “Focus on Brand India” The Hindu Nov 2009.
Bisht Indira “India Inc Year of Globalization” Pitch Dec 2009.

Business Today-Jan, 2008.

Citizen Charter, Times of India, Feb, 2007

Economic Survey 2009.
Here’s why western firms are heading firms heading towards India, The Economic Times
Oct, 2009
Hindu Survey of Indian Industry, 2009
India Today Dec 2009.
Mathew John, 2005 “India as a Brand – Marketing Perspectives”
www.managementpapers.com
Murari G S “Can India be a Brand” Business Line, Feb, 2005.
Neelamegham S. “India Inc. in the New Era of Globalization: Opportunity and Challenges”
Journal of Marketing & Communication”Vol 1 May, 2005 (21-36)
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Rajgopal N R “Brand India” The Hindu Dec, 2009
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2009.
Ramesh Jairam “Defining Brand India” Business Line, Feb, 2009.
Seshadri DVR “Understanding India from a Business perspective: Opportunities and
Challenges for MNCs”Vikalpa-volume 31, July-Sept-2006 (95-118).
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Communication”Vol 1 May, 2005 (4-20)
Sheth Jagdish “India as a Brand only needs repositioning”, Business Standard, Feb 2009.
Simon Anholt “Competitive Identity” The Economic Times, New Delhi Feb 2009.
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