“In a way, India has 50–60 countries. There is so much diversity among the consumers that there could be different models in each state, and each state can have its own marketplace leader” – Punit Soni, Chief Product Officer at Flipkart

“Why India? (1) the people, and (2) the opportunity is real,” Rakuten CEO Hiroshi Mikitani to YourStory, via Twitter

Economic Conditions and Doing Business

The Ministry of Statistics released new data, showing 7.4% GDP growth, an inflation uptick to 5%, and a 3.6% year-on-year increase in industrial production.

The Nikkei-Markit manufacturing PMI, the working measure of manufacturing growth, eased to a 25-month low in November, driven by a “stagnant labour market” and particular weakness in intermediate goods. Consumer goods remained strong. (FastFT)

BloombergBusiness: November 30
The packaged rice market is set to explode to $3.5 billion by 2017, and a shift in consumer tastes in favor of the packaged product and away from bulk and a fall in rice prices caused by a fall in exports to Iran is driving a windfall for the country’s rice mills.

Indeed India appears to some to be a host of different markets agglomerated, both for better and for worse. IndiaSpend analyzes state budgets, with intriguing findings on the debt picture of each state. Maharashtra has the largest debt total and industrial driver Tamil Nadu takes the prize for the largest debt increase in the past five years.

A new bankruptcy law on the table in this session of Parliament would compel debt restructuring for bankrupt to the fast track, where it currently takes over 4 years to recover about a quarter of debts on average. Banks facing an impending non-performing loan crisis would have some more hope, rather than obscure the realities of their debts to save face. (Economist)

The central government reported that Rs. 1.2 lakh crore of electronics manufacturing investment proposals have been offered since the launch of “Make in India” last year. Tax incentives abound for electronics manufacturing as the government aims to meet its goal to cut out imports by 2020. (Economic Times)

OneIndia: November 22
Floods of record severity in Tamil Nadu, including central Chennai and other major cities, have disrupted the economy. The first hit came to the fruit and vegetable supply, followed by the disruption of transportation including the closure of the Chennai international airport.

The Frontier of Change: Startups and Entrepreneurs

TechInAsia: December 2
Ola and Uber dominate the commercial vehicle startup headlines, but they may soon be joined by a bevy of two-wheeler-based companies. Haryana joined Goa on December 1 to permit two-wheelers as commercial vehicles, largely a result of the good-faith negotiation efforts of the founders of Baxi Taxi – who described the process as “easier…than it was to raise funding.” From logistics to last-mile coverage, the potential has always been enormous in India, and momentum seems to be building toward a breakthrough.

Flipkart’s Chief Product Officer, Punit Soni, dishes on the trends and market opportunities emerging today. He likes event organization, packaging, peer-to-peer marketplaces, and more. Tellingly, the former Googler remarks, “Bay Area was never short of intellectual fervour and interesting ideas. But India is a young country – it shows in ideas and thought processes; there is maniacal energy here. However, there is a lot of maturing and learning yet to happen.” (YourStory)

Economic Times: November 24
A collective of business leaders and entrepreneurs is in talks with the state government to fast track the process of setting up a company. While the central government considers a national startup policy, the business community is hopeful of sneaking in change state-by-state where it counts more in the short term.

Economic Times: November 29
India has always had a garbage problem, but it is becoming heavier and trickier to deal with by the day, driven by increased plastic and e-waste. The private sector has the ingenuity and will to support the beleaguered public service providers, finding the best solutions to recycle mobile phones and plastics, and delivering effective composting solutions. There may not be a bigger need than this in India, and the sophistication of these infant solutions is a marvel to explore.

Firstpost: November 30
As India goes green, an entrenched community of fossil fuel workers will be displaced, but coal miners in Meghalaya set an example, casting aside despondency, thinking fast and pivoting to farming a particular type of turmeric, becoming a hub for the crop.

Economic Times: November 29
For all the talk of stagnant or declining rural demand and despair in the rural community following another poor monsoon, the Karnataka government has a way toward prosperity, utilizing a public-private partnership concept to organize groups of farmers, matched with experienced executives, as “horti-business entrepreneurs.”

Political Effect

PTI: December 2
The Northeast provides 10% of gas and 12% of oil to India, but oil production has declined and the industry has grown sluggish, so the central government is actively exploring ways to promote investment, meeting with the top bureaucrats in all of the Northeastern states.

  • Regional trade routes unexplored since Partition are being busted open, and a wave of “subregional initiatives” seem to bode well for the export picture from Kolkata and the Northeast. (Indian Express)

India Today: November 25
How has Modi dismantled the “sleazy nexus of power, cash and influence” that ran the show in Delhi? Fascinatingly, and due to the contributions of a special few who entered as top advisors when Modi took over just last summer. While the transformation is new and likely still molten, transparency, merit, and efficiency are the watchwords of the day, and ministers can no longer choose their top officials.

Economic Times: November 29
India’s major cities are making a special effort to establish state-of-the-art metro transportation systems, and Japan has just committed to help Chennai and Ahmedabad, two massive industrial centers. The central government is pressing forward with its infrastructure drive, despite its puzzle of debt and private sector shyness.

Companies and the Market

While India has seen investment booms and busts, venture capital has never been this important or effective. Underwritten by venture capital and the government, the startup boom is for real and is not letting up, says Derek White, Chief Design and Digital Officer for Barclays. “The calibre of talent in the country needs to be recognised, specifically with regard to technological expertise,” he explains. (Economic Times)

Economic Times: November 30
LG’s price cuts are likely to help it solidify its leadership in the consumer white goods market, as its capability to reduce the consumer cost while increasing the margin to retailers is forcing its competitors to drive down prices. Watch this space to see if demand reacts robustly.

Economic Times: November 30
Coke has a strategy is to become a regular presence very close to the Indian consumer by fitting into their well-established framework. Dairy is a daily reality in the Indian household where carbonated drinks are not.

Opinion and Analysis

Bloomberg Gadfly, Andy Mukherjee: November 30
A frenzy among large telecom companies for a quality share of the new generation broadband network will leave them indebted and flagging, fighting a degenerative battle, Mukherjee argues, while mobile internet penetration increases. Content production startups will benefit, outcompeting telecom majors to reach their audiences.

Business Standard, Shailesh Dobhal: December 1
Millennials value a sustainability proposition from brands, and Hindustan Unilever as much as Patanjali Ayurved are taking advantage. In India as much as anywhere else, according to market research, there is a demand from consumers for companies as well as governments to take a role in the global greening project.