December 11, 2010

Medical tourism to become USD 100 bln industry by 2012: Report


The Medical Tourism sector is growing exponentially all over the world and is set to become a USD 100 billion sector by 2012, a new report has said.

The sector is growing at a rate of 20-30 per cent annually and is bound to continue its growth pattern in the years to come.

According to Frost and Sullivan, the business research and consulting firm, the medical tourism industry is currently a USD 78.5 billion industry [end-2010], catering to over three million patients who travel around the globe for medical care.

The Middle East is one of the latent source markets of patients and it is estimated that 20 per cent of healthcare seekers worldwide are from Gulf and Arab states.

Significantly, patients from UAE alone spend about USD 2 billion in healthcare travel on an annual basis.

As a result, many countries are targeting the region to woo guests and patients to their own medical tourism destinations.

Germany, in particular, and Europe, in general, have been primary medical tourism hubs for hundreds of years and continue to lead the industry followed by Thailand, India and Malaysia.

Boasting of an excellent healthcare system, high quality, safe and quick treatment, Germany is considered to be a top destination for patients from all over the world, and particularly from the Middle East, UK and the US.

Germany is also an attractive destination for patients from the region, in terms of distance, costs and tourism attractions.

A McKinsey and Company 2008 report also emphasizes that 40 per cent of medical travelers seek advanced technology, while 32 per cent seek better healthcare.

Another 15 per cent seek faster medical services while only 9 per cent of travelers seek lower costs as their primary consideration.

December 7, 2010

India will create 58 mn more jobs by 2012: Labour Minister


Labour Minister Harish Rawat says the government is confident of creating 58 million additional jobs by the end of the 11th Five Year Plan in 2012 thanks to the smart recovery in the farm sector and its resultant impact on the rural economy.

‘Agriculture has responded very positively. With economy poised to grow at nine percent in this fiscal year, we will be able to meet the target,’ Rawat told IANS in an interview, adding his assessment was that the country now was mid-way in realising the target.

Even though agriculture was not among the sectors identified by the central government for incremental employment during the 11th Plan, Rawat said buoyancy in the sector will be beneficial as it employs two-thirds of the labour force, directly or indirectly.

India’s farm sector grew 2.5 percent in the first quarter and 4.4 percent in the second quarter of this fiscal, as opposed to a mere 1.9 percent and 0.9 percent, respectively, during two corresponding quarters last fiscal.

The gross domestic product (GDP) climbed 8.9 percent each in the first two quarters.

Rawat said the 10th Five Year Plan target of creating 50 million additional jobs fell short by three million due to a shortfall in fresh employment in sectors like manufacturing, transport, tourism and agriculture.

As per the report on the employment and unemployment survey released by the labour ministry in October, the unemployment rate in India was 9.4 percent last fiscal. In the rural areas the unemployment rate was 10.1 percent and in the urban areas 7.3 percent.

The labour minister said his ministry had also put together a working draft of a new employment policy, which aims at creating skilled manpower according to industry needs, which has also been the main demand of the private sector.

December 4, 2010


Newsletter-Dec10

November 16, 2010

Banks borrow 103k cr, liquidity remains tight


Money markets continued to remain tight on Monday as call rates rose to 6.93% from 6.75% on Friday. Banks borrowed a net amount of Rs 1,03,525 crore from the Reserve Bank of India’s (RBI) repo windows, lower than Rs 1,18,570 crore borrowed last Friday.

Meanwhile, yields on the ten-year paper, dropped by three basis points to close at 8.06% on Monday, though they had risen briefly after inflation data for October came in at 8.6%. Wholesale inflation declined for the second consecutive month to 8.58% in October, as against 8.62% in September.

RBI deputy governor Subir Gokarn said on Saturday the liquidity deficit may result in greater volatility in short-term rates. Gokarn noted RBI may relax bond-holding rules, buy back government securities or take other similar steps to deal with a liquidity shortage in the banking system, but would not reduce the cash banks need to set aside as reserves. “It is very difficult to be raising rates on the one hand and reducing the cash reserve ratio on the other because two are contradictory,” he said.

November 11, 2010

G20 struggles to move beyond vows of cooperation


A deeply divided G20 struggled to move beyond broad promises of economic cooperation as world leaders gathered in Seoul for a two-day summit on Thursday.

Former U.S. Federal Reserve Chairman Alan Greenspan said the United States was pursuing a policy of weakening the dollar, adding fuel to an already heated Group of 20 debate over the U.S. Federal Reserve’s bond-buying spree to revive the economy.

The G20 club of rich and emerging economies had hoped to use the summit to soothe tensions over foreign exchange rates that have been created by sharply divergent economic growth rates. President Barack Obama urged his peers to put aside differences and follow through on previous agreements to even out imbalances between cash-rich exporting nations and debt-burdened importers.

Thursday’s agenda included dozens of bilateral meetings as well as ceremonies to mark the Veterans Day holiday. The summit officially kicks off with a working dinner Thursday night and a full day of meetings on Friday.

Behind the scenes, negotiators met for a third day to hash out the language in a closing statement to be issued at the summit’s conclusion on Friday. The final version may not venture far beyond agreements reached by G20 finance ministers last month, yet it still proved difficult to agree on the wording.

South Korean President Lee Myung-bak said a “little bit” of progress had been made since the October finance ministers meeting in Gyeongju, South Korea, but deep divisions remained over how best to reduce current account imbalances.

November 1, 2010


Newsletter-Nov10

October 26, 2010

Food prices a structural inflation driver – RBI


The Reserve Bank of India (RBI) warned on Tuesday that surging food prices are structural and will put upward pressure on inflation and interest rates.

The RBI is widely expected to raise interest rates by another 25 basis points on Nov. 2 as it continues to battle headline inflation that rose to 8.62 percent on an annual basis in September.

“Persistent price increases in commodities for which there are less effective substitutes, with other things remaining equal, will raise the potential rate of inflation over a period of time,” RBI Deputy Governor Subir Gokarn said in a speech on Tuesday.

The yield on India’s most traded 7.99 percent, 2017 bond rose two basis points to 7.98 percent, up 2 basis points after Gokarn’s comments as traders said they added to the likelihood of a 25 basis point rate increase next week.

“This means that actual inflation or interest rates will be higher than they would be in the absence of such increases,” said Gokarn, whose brief at the central bank includes monetary policy.

Annual food price inflation eased to 15.53 percent in early October but remains stubbornly high, in part because of rising demand as incomes increase. The economy of the world’s second most populous country is on track to grow at 8.5 percent this fiscal year.

“When we take into consideration the impact of structural food price shocks such as the ones India is experiencing, the policy implications become complex,” Gokarn said.

Production of pulses was not keeping pace with demand, he said.

The price of some pulses, which are a main source of protein for Indians, has roughly doubled over the past three years.

“Rise in income has increased the share of proteins in peoples’ diet. Rising affluence has also led to an increase in demand for proteins and nutrition,” said Gokarn, adding one option would be to import pulses through contract farming.

The RBI has raised interest rates five times this year amid headline inflation that was in double-digits for six months through July.

The central bank’s perceived comfort zone for wholesale price index (WPI) inflation is 5 to 6 percent, and it has said it expects inflation to ease to 6 percent by the end of the fiscal year in March

October 23, 2010

Ten-Year Bond Yields Rise Toward Two-Year High as Cash Availability Drops


India’s 10-year bonds fell, pushing yields to a two-year high, on concern an auction of notes by the finance ministry today and sales by state governments next week will further reduce the availability of cash to buy debt.

Banks borrowed an average 485 billion rupees ($10.9 billion) from the central bank’s repurchase auction window each day this month, compared with 251 billion rupees a day in September. India sold 110 billion rupees of bonds due in 2017, 2022 and 2040 today. Investors will make the payment on Oct. 25. Funds in the banking system have dropped after Coal India Ltd.’s initial public offering that ended yesterday, the country’s biggest share sale to date.

The yield on the 7.8 percent note due May 2020 rose seven basis points, or 0.07 percentage point, this week to 8.14 percent as of the 5 p.m. close in Mumbai, according to the central bank’s trading system. The price dropped 47 paise per 100 rupee face amount to 97.77.

October 21, 2010


CCAS Newsletter-oct10

October 21, 2010

PE Players See an Exit Season


It is exit season for private equity investors in the realty space. With a smart recovery in the Indian realty sector and an impressive lineup of public offers, investors are getting to see the face of money. Significantly, investors at the project or SPV level are up for a busy exit season given the increasing demand for residential and commercial space.

Consider this: Red Fort is exiting more than five deals. In the residential space, Red Fort has sold over 5,000 apartments in Tier 1 cities such as Chennai, Bangalore, Delhi, NCR. Kotak Realty Funds Group  is planning complete exits from two of its IT Park investments – Peepal Tree Properties, a green field IT park building in Mumbai and Green Boulevard, a project in Noida IT Park, Delhi. Indiareit Fund Advisors is eyeing five partial exits this year from its large portfolio of residential projects. It plans to exit from Neptune Developers, and other projects such as Skyline (Bangalore), Samira (Mumbai) and SSPDL Northwood (Hyderabad) this year. It made a partial exit of Rs 49 crore from Aristo (Mumbai) in April, where it invested Rs 150 crore.  

Data shows, 2010 witnessed exits deals such as CVCI-Emaar MGF Land Ltd ($60 million), WDC Ventures-Vijay Associates Constructions Pvt. Ltd. ($40 million), Symphony Capital Partners-DLF Assets Ltd ($694 million), Siva Ventures Ltd-Aamby Valley Ltd ($323 million).

DE Shaw Composite Investments (Mauritius) Ltd. exited from DLF Assets Pvt. Ltd. for $470 million (Rs 2200 crore) by selling its entire stake to Rajiv Singh, Vice Chairman, DLF last year.

%d bloggers like this: