'Every challenge is an opportunity'

BANGALORE: S Ramadorai, CEO and MD of the country's largest IT services company Tata Consultancy Services, retires on October 5, Monday. He took the mantle in 1996 when the 6,000-people company had earnings of about $100 million. He took TCS to $6 billion in revenues and 140,000 in people strength. Ramadorai shares some of the highlights of his career at TCS with TOI. Q: You are completing your tenure as CEO & MD of TCS and getting into a new role in brand building and leadership mentoring. What are the major milestones TCS achieved under your leadership? A: In the last over a decade, TCS has become a true global player with 142 offices across 42 countries and with over 800 clients, many of whom are Fortune 500 companies. We have successfully ventured into key markets in Latin America, China and Eastern Europe. My focus has always been on planning and directing technology development, building strong relationships with customers, stakeholders and academic institutions. Q: You grew TCS from a small domestic company to a multi-billion dollar global corporation. What are some of the most crucial challenges you faced during this journey? A: Global competition, client diversification, margin expansion and economic slowdown are the continuous challenges one faces. The key is to be innovative, willing to diversify and be adaptive to each situation. Investing and believing in your team and people is key. But the initial years were tough for us. There were a number of policies and government regulations that were not favourable. Everything was a process of convincing people, giving commitments that were very difficult to meet. But those were the ones that taught us how to do more with less. Our patience paid us good dividends. Q: TCS leads the Indian tech industry. But in terms of size and revenues, Infosys and Wipro are not too far behind. Do you see this as a threat and what is your strategy to remain ahead? A: TCS has always been the leader and will continue to sustain its growth. Given our large global footprint, including our investments in new growth markets and emerging markets like China, Brazil, Argentina, Mexico, Chile, Hungary and India, we believe we are well positioned for sustained growth globally. Also, our diverse service portfolio shows that there is tremendous headroom for growth among our existing global customers and new clients. Q: Industry peers like Wipro, HCL and Cognizant have been active in terms of inorganic growth, but TCS has not made any acquisitions, barring the Citi Global deal. Yet, you recently emphasised the importance of size and scale. What is your comment? A: For TCS, growth has always been largely organically driven. However, we have always said that we will look at acquisitions at a strategic level. And over the years, we have made several such moves, CMC (in India), FNS (a banking product company in Australia) and Comicrom (BPO in Chile). All these acquisitions have helped us fill gaps in our portfolio of services or allowed us to enter new markets quickly, like BPO in Latin America following our acquisition in Chile. We have a dedicated M&A team that continues to examine opportunities for M&A as they arise and we are always open to acquiring if a compelling reason is there. Q: Based on your vast experience, what message would you like to leave behind for the industry? A: The current economic tsunami has been among the toughest phases in my career. But I believe every challenge is an opportunity and trying times are a good time to learn and improve, reflect and ask fundamental questions like: Are you doing the right thing? Are you compromising to bring harm to the organization? Keep the mood and work upbeat. Fight the daunting times with frugality and rigour.

ICICI Pru pips SBI Life to become largest private insurer

NEW DELHI: Private insurer ICICI Prudential has pipped SBI Life to regain the top position among private players garnering new businesses Rs 1,725 crore in the first five months of the current fiscal.

SBI Life, promoted by the country's largest lender State Bank of India, earned first year premium worth Rs 1,704 crore in April-August period while ICICI Prudential collected Rs 1,725 crore in the same period, according to the IRDA data.

The ICICI Prudential's gain is mainly from the large premium the insurance firm managed to mop up in August. The company new business during the month stood at Rs 525 against SBI Life's Rs 306 crore.

SBI Life had taken over ICICI Prudential to become the largest private insurer in the first two months of FY'10. However, when compared to last year, ICICI Prudential's premium dipped by about 40 per cent. In the first five months of FY'09 its premium stood at Rs 2,818 crore.

SBI Life also saw its premium declining to Rs 1,703 crore in the first five months of this fiscal, compared to Rs 1,763 crore raised in the same period last fiscal.

Overall, the private life insurers registered a negative growth of about 15 per cent during April-August of the current fiscal. The 21 private life insurers managed to raise Rs 10,227 crore in the first five months of FY'10 against Rs 12,089 crore during the same period last year.

However, the life industry grew by 17 per cent in April -August of the current fiscal, with the life insurance companies' premium rising to Rs 31,039 crore against Rs 26,449 crore during the same period last year.

This was mainly due to the 45 per cent growth in new business registered by the country's largest insurer Life Insurance Corporation.

LIC's market share rose to 67 per cent in new business in the first five months of current fiscal from 54 per cent share during the corresponding period last year.It mopped up Rs 20,810 crore during April-August period of the current fiscal, compared with Rs 14,359 crore during the same period last year.

In August, the premium collection of the life insurance industry grew by around 44 per cent to Rs 9,044.18 crore against Rs 6,273.57 crore in the same period last year.

The private life insurance segment, however, witnessed a negative growth of around 8 per cent, while the LIC registered a whopping growth rate of 83 per cent in premium collection in August.

Commenting on the August figures, Reliance Life Insurance President Malay Ghosh said, "The new business numbers are showing growing trend each month which is a positive sign. We are sure that the private sector will be back on the growth path by the second half of the financial year."

Swiss banks offer to tax Indian clients

New Delhi: Pressed hard for giving access to details of money stashed away by Indians and other overseas clients with them, Swiss banks have offered to tax this wealth on behalf of the respective foreign governments.

India, where there have been long-running demand for concrete actions to bring back the black money lying in highly secretive Swiss banks, will begin talks in December for a new tax treaty with Switzerland so that it could get details about the defaulters.

Besides India, a number of other countries are also said to be looking at similar treaties, while the US recently reached an agreement for giving access to close to 4,450 bank accounts of Americans with Swiss banking major UBS.

As an alternative to the information exchange, Swiss banks have mooted the idea of a 'universal withholding tax' --wherein they would tax the earnings generated from the wealth of foreigners deposited with them and transfer the proceeds to the government of the concerned country -- and is currently discussing the same with the relevant authorities.

When asked about the proposal and its applicability to the wealth deposited by Indians in Switzerland, Swiss Bankers Association's Head of International Communications James Nason said from Basel: "We are in contact with the Swiss authorities about the proposal so it would be premature to publicise more details for the moment."

Air fares likely to go up as AI stir deepens

MUMBAI/NEW DELHI: A decision by Air India management to restore productivity linked incentives (PLI) of 7,000 of its employees failed to pacify

Top 15 global airlines Top performing airports Wackiest aircrafts

the striking pilots, heightening the possibility of an increase in air fares in some of the country’s busiest routes.

More than 30 flights, including six international ones, were cancelled as Air India’s pilots reported sick for the second day running. “The fares could jump by up to 10% if the strike continues as many people are looking to rebook their tickets,” said a travel agent, requesting anonymity.

Executive with a private airline said private airlines would see an increase in bookings if the strike continues beyond the weekend. He also predicted a 5-10% hike in fares.

Air India’s executive pilots have been on sick leave since Friday midnight after the airline board approved a 25-50% cut in PLI for nearly a fourth of its 31,000 employees. Expat pilots and members of the Indian Commercial Pilots’ Association were spared the cut. Air India said the airline would resume normal operations on Monday. However, captain VK Bhalla, a senior executive pilot leading the agitation, said the strike will continue. “Our chief (Air India chairman and managing director Arvind Jad-hav) is playing a game by inviting only one group of pilots in Mumbai for talks,” he said.

India will build Ford's Figo

NEW DELHI: American carmaker, Ford Motor, plans to make India its manufacturing hub for its small car Figo it showcased on Wednesday for the Asia

Ford Figo New Ford Endeavour

Pacific market. Ford has targeted 2 lakh cars for India by 2010. After unveiling the Figo in Delhi, Ford’s president and CEO Alan Mulally said: “The global market is shifting towards smaller cars and India has a predominant advantage with a 70% market for compact cars. With Figo, we plan to get a larger chunk of the premium hatchback market, both in India and overseas.”

“Our plan for India involves accelerating development of fuel-efficient small cars. The small car market in India will double in the next one decade,” said Mr Mulally. He, however, ruled out plans to compete with Tata Motors’ Rs 1-lakh car the Nano and Maruti Suzuki’s M800 in the near future.

Figo, Italian for “cool” will be launched in the first quarter of 2010 and come in both petrol and diesel variants. Ford India has not announced any price but the car is expected to cost Rs 4 lakh and upwards for the base variant and will be pitted against Maruti Swift and Ritz, Fiat Punto, Chevrolet U-VA and Hyundai I20.

ADB upgrades India's growth forecast to 6%

New Delhi:

• Multilateral lending agency Asian Development Bank has revised upwards India's growth projection to 6 per cent for the current fiscal on account of rising business confidence but warned that inflationary pressure would continue.

• "Emerging signs of a recovery in private business confidence and a continued large fiscal stimulus announced in the July 2009 budget helped bolster India's projected economic expansion to 6 per cent this year, upgraded from 5 per cent in March," ADB said in its update on Asian Development Outlook 2009.

• India, it added, would be able to clock 7 per cent growth rate during 2010-11. Country's growth rate slipped from 9 per cent to 6.7 per cent in 2008-09 on account of the impact of the global financial crisis.

• Projecting an inflation of 4-5 per cent by March 2010, the ADB said, "inflationary pressures are likely to persist, driven by high food prices and expansionary monetary and fiscal policies."

• The inflation has turned positive for the week ended September 5, after remaining in the negative zone for about three months.

• Rising food inflation, ADB said, would create a dilemma for the monetary authority which is currently engaged in combating the impact of the financial meltdown by following easy money policy.

PNB looking to pick up stake in Kazak bank

New Delhi: The country's second largest lender, Punjab National Bank, is in the process of picking up a stake in a small Kazak bank, Metrokombank.

PNB has been looking for acquisition in the oil-rich Central Asian state. Sources said the talks are at a very preliminary stage as several things need to be looked into, including regulatory approval.

For, the minimum capital requirement for opening a bank in the country is high. The current volume of trade between India and Kazakhastan also does not warrant this kind of investment. Therefore, buying stake in a small bank is a viable option, the sources said.

PNB currently has a representative office in Almaty.

The bank, which is present in 8 countries, is planning to open few overseas offices, including a branch each in Shanghai, Dubai and some place in Norway.

It is also looking to set up a subsidiary in Vancouver, Canada, and a joint-venture in Bhutan.

Recently, the bank increased its branches by one each in Hong Kong and the UK.