India is the safest market in the world'

In the fourth Smart Portfolios interview, Anand Agarwal, fund manager, Reliance Money, talks about his investment strategy.

Agarwal, an ardent believer of GARP (growth at a reasonable price), spoke with Rex Cano, about his investment style, preferred sectors and market expectations.

What will be your investment style in Smart Portfolios?

My investment style would be rather very simple; I will invest in stocks, which have the potential to generate good returns in the medium- to long-term. I like to invest in companies which have consistent cash flows and good business potential.

What are the stocks or sectors one should look at in a volatile market?

Among sectors, infrastructure, utilities and aviation should do well over the medium- to long-term. Among utilities, telecom would be the preferred pick given the strong growth in subscriber base over the next couple of years.

Aviation sector is a contra bet as the sector is going through a consolidation phase which would result in better pricing power. Also, falling crude prices would benefit the sector as fuel prices account for a disproportionately high percentage of revenues.

The financial sector should also do well over the longer run as India is an under-penetrated market and less than 2 per cent of India's population is actively involved in the equity markets.

What's your view on the rupee depreciation?

One of the major reasons for the rupee depreciation was high crude oil prices, high inflation and the US subprime crisis. Adding to this was the US dollar appreciating by 12-I5 per cent against all the major currencies during this period. We see the rupee consolidating at current levels and gradually appreciating in the medium- to long-term.

Also central banks do not prefer high volatility in currencies as it impacts international trade due to the uncertainties associated with volatile currencies.

Looking at the robust growth of the economy and receding crude prices, there is no reason why the rupee should depreciate against the US dollar over the medium to long term. I do not see the rupee going below the 47-mark. The currency may consolidate at current levels for the near term.

The US economy is facing turbulence and the government has announced a mega bailout plan to strengthen the weakening financial giants. Where do you see the US markets going from here?

Some or the other event which is as big as the current crisis has taken place in the past, it's happening today and it can happen in the future as well.

However, I believe that we are somewhere in the last phase of the financial crisis, and the proposed bailout package would go a long way in helping clear the financial logjam.

The US economy is currently going through a de-leveraging process and is expected to post below trend growth for the next couple of years. Once the de-leveraging process is over, growth should be back on track.

How long will it take for our markets to stabilise?

For the last six to nine months our markets are swaying to global cues. However, I believe that the India growth story is intact, and a GDP growth rate of 8 per cent can be maintained. Even while the FIIs were pulling out from our markets, FDI inflows remained intact, which is a positive sign. I expect the markets to remain volatile over the next quarter, after which we should see the markets consolidating before moving up. India's domestic driven economy and low dependence on exports makes it one of the safer places to invest.

Would you prefer portfolio concentration or diversification?

I am definitely not for portfolio concentration but neither do I believe in over-diversification. However, if I like a certain sector I may give more weightage to it in my portfolio. However, I would be dynamic in my approach and look to churn my portfolio at the appropriate time.

What should be an average time horizon for an investment?

Ideally one needs to invest with a horizon of at least one to two years to allow the investment to grow. Also, for investment purpose one should have a clear target in mind based on fundamentals while stop losses are a must in case of trading. However, one should not be too rigid and should adapt based on the underling economic conditions.

With earnings season coming up, what kind of results do you expect from India Inc? What is the likely impact on stock prices?

We do not expect any major surprises from the second quarter results, although there may be some pockets of disappointment. We expect moderate growth in corporate profitability unlike the 20 per cent plus growth witnessed during the last three years. The earnings season would be a more sedate event this quarter.

What kind of returns do you expect at the end of a year in Smart Portfolios?

I would try to generate better than market returns. Given the current market scenario we expect around 15 per cent returns on investment by the end of the year.

What are the qualities that make a good fund manager?

Every fund manager has a different approach. One needs to look at valuations, the future business potential, competition analysis and management competence.

A fund manager should be good at both quantitative as well as qualitative analysis, and should not chase the markets. At the same time he should be quite flexible, and adapt to the changing environment and not be rigid in his approach.

What is your advice to first time investors?

For a new investor this is a very good entry opportunity, and equity as an asset class is the best investment option available. In the current environment even blue chip stocks have been beaten down significantly and are currently trading below their fair valuations given the future growth potential.

Looking at the inherent strength of the economy, we believe that this is just a cyclical slowdown within the longer term structural bull market. With consumption levels rising, we may see the economy growing at 7.5 to 8 per cent which is still very high as compared to the global economic growth.

Hence I feel that the long term structural bull market would resume once the cyclical correction is over, and it's a good time to gradually build a portfolio over the few months. One can look to invest in sectors such as infrastructure, utilities, financials and also energy.

What are the three most important things that an investor should look at in a company before committing an investment?

First, I would look at the cash flows. Second, the future growth potential of the business and the competition it faces. The last but not the least would be management competence.

US House approves historic India nuclear deal

Washington: The House of Representatives passed a civilian nuclear pact with India that lifts a three decade-old ban on civilian nuclear trade with India.

The agreement, passed by a 298-117 vote, will now head to the Senate for its vote, but it was unclear if it would be passed before Congress adjourns ahead of the November 4 elections.

Signed by President George W. Bush and Indian Prime Minister Manmohan Singh in July 2005, the deal offers India access to Western technology and cheap atomic energy provided it allows UN nuclear inspections of some of its nuclear facilities.

Bush on Saturday congratulated the House on the vote.

"The passage of this legislation by the House is another major step forward in achieving the transformation of the US-India relationship," he said, urging Senate now to adopt the bill.

But the deal has faced criticism from opponents who argue that India, which first tested an atomic weapon in 1974, is not a signatory of the nuclear Non-Proliferation Treaty (NPT).

Representative Edward Markey, a senior member of the House Energy and Commerce Committee, denounced the vote, saying in a statement: "This is a terrible bill that threatens the future of the global nuclear non-proliferation regime."

And he argued during a late night debate Friday that opposing the bill did not mean opposing India.

"This is a debate about Iran. This is a debate about North Korea, about Pakistan, about Venezuela, about any other country in the world that harbors the goal of acquiring nuclear weapons," he said.

House Speaker Nancy Pelosi sought to allay any lasting concerns, saying the legislation would boost US oversight on any US civilian nuclear assistance to the South Asian nation.

She welcomed the vote saying in a statement that the accord "furthers our countries' strategic relationship while balancing nuclear non-proliferation concerns and India's growing energy needs.

"The legislation recognizes India's past support for non-proliferation initiatives and strengthens congressional oversight of any future US decision to assist India's civilian nuclear program."

Democrat Representative Joseph Crowley said Saturday's vote was a "historic moment."

"We are uniting the world's oldest and the world's largest democracies in an effort to expand peaceful and responsible development of nuclear technology," he said.

The House Foreign Affairs Committee member also recognized "the Indian American community for their incredible advocacy and efforts to educate members of Congress on the importance of this agreement and the US-India relationship."

The agreement had long been stalled in Congress, and on Thursday Bush told the visiting Singh that he was working hard to get it passed as quickly as possible."

New Delhi, which is critically short of energy to fuel its booming economy and its burgeoning population of 1.1 billion people, is looking at investments worth billions of dollars in its power sector.

The draft bill proposed by the White House says: "Civil nuclear cooperation between the US and India pursuant to the agreement will offer major strategic and economic benefits to both countries, including enhanced energy security."

It also promised "an ability to rely more extensively on an environmentally-friendly energy source, greater economic opportunities and more robust non-proliferation efforts."

If the Senate now endorses the agreement it would finally end a three decades-old ban on nuclear trade with India imposed after it carried out its first nuclear test in 1974 and refused to sign the NPT.

But New Delhi, which agreed to open some of its reactors for inspection, now has approval to buy fuel and technology from the International Atomic Energy Agency and the Nuclear Suppliers Group (NSG), which controls global atomic trade.

Washington spearheaded the efforts that led this month in the Vienna-based NSG lifting a global ban on trade with India.

The road less travelled: a sceptic’s view of the commodities boom c

The case for the believers

The case for the resource believers is reinforced con­stantly through
the bullish sentiment from the media, stockbrokers and resource
company executives.
Competition for superla­tives remains intense as "stronger for longer"
is superseded by "100-year boom", "stronger forever" and "it's
different this time". The gist of the 'believers' arguments is
similar, but the central tenet is a demand-led argument stemming from
a number of reinforc­ing factors:

> Chinese economic growth. After an extended period of extremely strong gross domestic product (GDP) growth (it has not fallen below 7 per cent since 1991), growth momentum has increased the confidence among most of the financial community and the gener­al public, that growth will continue unabated. The primary reasons for expect­ing continued growth appear to be extrapolation in addition to the scale of ongoing capital investment and the 'once in a lifetime' industrialisation of the world's largest population.

> Decoupling. As the slowdown in western economies, particularly the United States, has chal­lenged the traditional com­modity price response (ie, declines), the term 'decou­pling' has been coined.

> India. With the large population base of China being a major driver behind the story, the potential for India's similarly large pop­ulation to act as further stimulus for the demand story is logical.
On the supply side, sim­ilarly emotive arguments add further fuel for
the believers:

> Inability to secure new supply. While arguments on 'peak oil' have been around for decades (and yet to be realised), the inability to add supply quickly in many commodities due to infra­structure and labour supply bottlenecks has fuelled con­cerns over the ability to add supply in the longer term.
The ability of these argu­ments to elicit an enthusiastic reaction
among a large number of investors is obvi­ous. The opposing case for
sceptics is perhaps more complex.

The case for the sceptics

Calling into question the structural elements of the commodities boom
may be somewhat heretical at pres­ent. However, with the con­fidence
that 'burning at the stake, has been abandoned as punishment I'll try
and make the case for why I believe the boom to be cycli­cal rather
than structural, and prices of resource stocks, in most cases, to be
unsustainably high.
Click here to find out more!
Separating the impact of price and volume

In many commodities, the lack of investment in mining and associated
infra­structure over time has been a significant factor in the current
supply demand imbalance. In some cases this imbalance has been
exacerbated by marginally greater than expected growth in demand.
However, price is the important factor in relation to the current
imbalance. Exceptional growth in prof­it, cash flow and return on
capital, are almost always driven by price, as this requires no
further invest­ment. The complication in forecasting relates to the
ability to determine the price at which additional supply will be
encouraged, the price at which demand will be destroyed, and how long
prices will take to return to equilibrium.
Commodity producers have been enjoying that most gratifying phase of
profitability, in which sup­ply has been increasingly squeezed in a
broad range of commodities.

Impact of GDP growth

'Growth' is a particularly alluring term for both investors and
companies although it tends to be poor­ly understood. 'Growth' is an
input to the 'value' of any business, rather than an attribute that
should be sought out regardless of value.
By way of example, a recent article in the UK's Financial Times, made
ref­erence to an investor who proposed an argument that the Chinese
stock market may be reasonable value at a PE ratio of 100, or an
earnings yield of 1 per cent, on the basis that when GDP growth of 10
per cent was added to this return, a total figure of 11 per cent was
more than acceptable, par­ticularly relative to the returns available
for alter­native Chinese investments.
The assertion that the earnings yield of a business can be added to
the GDP growth of the country to arrive at a total return expec­tation
is ludicrous. The GDP growth a country will accrue to both existing
and new competitors has little to do with the returns an investor will
earn, as it gives no insight into how much addi­tional capital will be
required to generate this growth.

Corporate activity – justification or capitulation?

The flood of Chinese capital targeting Aus­tralian mining company
stakes has further fuelled the current frenzy and some say a
justification for current valuations.
Fortescue is a good example. While it's been an amazing feat to
develop the Fortescue business in such a compressed time frame, if one
focuses sole­ly on the investment merit at current prices, it's a case
of overvaluation.
Developing the mine and infrastructure has seen cap­ital investment of
around $3 billion, however in total enterprise value (debt + equi­ty)
the stock market now values this business at more than $30 billion.
Investors buying the stock today expecting a return of say 10 per cent
will need pre-inter­est and tax earnings of around $3 billion in
perpe­tuity to deliver this return.
This assumption dictates that the original capital employed would earn
a return on capital employed of 100 per cent in perpetu­ity. Historic
evidence and fundamental laws of eco­nomics suggest the proba­bility
of this outcome is par­ticularly low.

Factors exacerbating commodity prices

Supply and demand imbalances alone are nor­mally insufficient to plant
the seeds for a 'bubble'.
However, the equation is being aided by a number of coincidental
developments in the financial industry.
The litany of repack­aged and restructured assets designed to lure
investors with the prom­ise of attractive or better yet, uncorrelated
returns, is never ending.
Even in the aftermath of sub-prime, the financial industry is more
concerned with identifying the next hot product than embark­ing on the
process of reform. Commodities trad­ing is a case in point.
From my perspective, there is absolutely no doubt that the entry of
long-only investment capital is impact­ing price in almost all
com­modity and energy markets, the only question is how much.
The influence of investors such as hedge funds, supposedly providing
'effi­ciency capital' to markets, is less clear.
However, it is likely that these participants will at the very least,
amplify volatility in each direction.
These futures contracts will need to be 'rolled' at regular intervals,
and require an opposing investor to take the other side of the
transaction. The only natural sellers of com­modities are producers
who obviously have a natural limit to their desire to sell forward
future production.
If, as is most often the case, trades are executed through investment
banks and there is no natural seller, investment banks or other
intermediaries will need to hedge the other side of the transaction by
eventually accumulating physical prod­uct. Every paper commodity
investment must eventually be backed by product.
The other contentious issue in explaining the inex­orable rise in
commodity prices is the contribution of overly easy monetary policy to
the equation.
Recent years have seen an almost unprecedented peri­od of coincident
growth in global economies, fuelled significantly by extremely strong
credit growth.
This booming period of credit growth has facilitat­ed a boom in both
con­sumption and investment.
The balance between consumption and invest­ment varies by economy.
Economies such as China have been powered almost solely by an
explosion in fixed investment, the US has consumed, while economies
such as Aus­tralia have been some­where in between.
The masters of extrapo­lation are assuming Chinese fixed investment
will con­tinue unabated. In my view, economics will eventually apply
to this investment. Erecting buildings, steel mills, aluminium
smelters and endless other infra­structure projects is only sensible
to the extent that end demand ensures these projects earn a sensible
return on capital.

Conclusion

These arguments are not intended to represent the rantings of an
aggrieved investor who happens to be on the wrong side of a pool of
investments subject to powerful momentum, although I will be the first
to confess to frustration.
They are intended to lend some weight to the case for investors to
consider the possibility that the com­modities boom may be cyclical,
and that assets in the area may currently be substantially overvalued.
The forces of momentum are powerful and the impact on human behaviour
equal­ly powerful, however, it is these factors that should ensure
fund managers apply even more rigorous analy­sis to the allocation of
cap­ital to companies in times such as these, rather than succumbing
to the path of least resistance.
I, for one, don't subscribe to the lemming theory of commodity prices.

Martin Conlon is the head of Australian equities at Schroders.
(This article is a synopsis taken from the paper titled 'Hymns for the
non-believer' by Martin Conlon dated June 2008.)

A rich harvest from Kisaan Bazaars

Organised retail might be faltering in urban India, but is booming in rural India, going by the experience of DCM Shriram Consolidated Ltd's Hariyali Kisaan Bazaar (HKB). Aimed exclusively at rural India, the company has seen sales from its 160 stores more than double in the last couple of years.

Average sales at an HKB store have gone up to Rs 5 lakh a day during the harvest seasons, while it is around a tenth of that during the lean season. That means the turnover of a single HBK store is over Rs 6 crore, annually, while the investment cost varies between Rs 2 crore and Rs 3 crore.

The growing popularity of HKB stores has also prompted banks and insurance companies to look at possible tie-ups to tap the rural customer. ICICI Lombard and HDFC Bank have already tied up with HKB for their products. Though he furnished few details, Ajay S Shriram, chairman & senior managing director, DCM Shriram Consolidated, said, "Banks and insurance companies get a ready customer base on a platter."

Shriram said HKB's retail model was developed exclusively for rural customers. "We have no intentions to bring it to urban areas; it has been designed for rural customers," he said, adding that retail in rural India is commercially viable.

HKB not only sells products relating to agriculture like fertilisers and seeds, but also household items as 40% of rural India comprises those that are not engaged in farming, Shriram pointed out.

The success of HKB has also encouraged the company to launch pulses and masalas under its own Hariyali brand.

Luis Bunuel  - "Age is something that doesn't matter, unless you are a cheese."

Nuclear family to take India on high-tech trip

NUKE WINTER NO MORE Energy, Communications, Avionics...The Works THE Nuclear Suppliers' Group (NSG) has lifted obstacles to India buying products and technologies associated with civilian uses of nuclear technology from (and selling these to) most significant nuclear powers save the US. To enable civil nuclear commerce with the US, that country's legislature must ratify the 123 Agreement finalised between the Bush administration and New Delhi.      The implications are not just for nuclear energy, significant as these are — our existing reactors running short of fuel would be able to run at full capacity and we would be able to set up new nuclear plants. While National Security Advisor MK Narayanan announced on TV that a grateful India would let the US have a large share of India's domestic market for nuclear energy, right now, the competitive advantage in terms of standardised reactor design, scale and, therefore, costs, is with France and Russia.      There is also the perception in some circles that the US conditions on supply of nuclear materials might turn out to be unacceptably stringent and intrusive, going by the State department's answers to the House Foreign Relations Committee. NSG deal is a steal on the strategic front      VITAL sectors of the economy stand to benefit from access to a range of hightechnology products and technologies that had, till now, been outside India's reach because of its status as a nuclear outsider. Many advances in materials, communications, computing, signalling, chemical processing and avionics are deemed sensitive technologies not accessible to nuclear have-nots. Access to these technologies opens up now. This will improve efficiencies across the board in India, from weather forecasting to oil refining.      But the biggest gain is strategic. Non-proliferation activists objected to what they called India's sweetheart deal on the ground that it gives India an exceptional status: It is the only country that possesses nuclear bombs but is not part of the Nuclear Non-Proliferation Treaty to be accepted into the community of nations allowed to legitimately engage in nuclear commerce. The major powers of the world have recognised India's status as a growing power whose potential to contribute to a stable global order is huge. It is that recognition that persuaded them to work out the current exception to nuclear convention in the form of the waiver from NSG. As India strengthens its strategic capabilities with the help of technologies made accessible as a result of the deal, it would put an end to the current situation of an ever-widening strategic gap between China and the rest of Asia. As India steps into its now acknowledged role as a balancer of power, it will benefit India and the world.      Prime Minister Manmohan Singh and the ruling UPA will gain credit for having made this global breakthrough, against much opposition and at the risk of losing power. WINNING TEAM: GEORGE BUSH AND MANMOHAN SINGH

Clifford Stoll  - "The Internet is a telephone system that's gotten uppity."

Bandra-Worli Sea Link: An engineering marvel

Mumbai gets a new landmark

 

Mumbai will get a new landmark with the completion of the work on the 5.8 km long Bandra-Worli Sea Link project. The project is a 8-lane, cable-stayed bridge with pre-stressed concrete viaduct approaches, which will link Bandra and the western suburbs of Mumbai with Worli and central Mumbai. The Rs 1306 crore project of Maharashtra State Road Development Corporation (MSRDC) is being executed by Hindustan Construction Company and is likely to be completed by January 2009. The Maharashtra government has announced the extension of the sea link by another 3.6 km up to Haji Ali at an additional cost of Rs 1,200 crore.

 

Far-reaching impact

Bandra-Worli Sea Link Project has the potential to bring about permanent and far-reaching changes in the travel patterns of the area. The link will provide a fast moving outlet from South Mumbai to the suburbs in the west. This link will also help in reducing the present congestion on the Mahim Causeway (which is the only link available at present between western suburbs and south Mumbai) and Western Express Highway .

Better connectivity

The sealink is the first phase of the Western FreeWay Sealink proposed to be built to improve the connectivity between the island city of Mumbai and its western suburbs. This link will be followed by a link from Worli to Nariman Point with dispersal to Cuffe Parade. The Sealink will also be supported by a series of flyovers, rail link, roadways and other public facilities.

Challenging task

The project envisages construction of 8 lane Sea link freeway from the interchange of Mahim intersection at the Bandra end to Worli Sea face on Khan Abdul Ghaffar Khan Road . The Construction of the sea link project is divided into four packages namely Package I,Package II, Package III and Package IV. The Package IV executed by HCC forms the main and the most technically challenging construction package of this project.

Salient features

Bandra-Worli Sea Link project has 9 approach bridge modules and two cable stayed bridges. Each approach bridge module comprises two independent carriageways. The deck of the carriageways consists of triple cell precast box girders supported on piers founded on independent substructure. The cable stayed main bridge has two similar precast triple cell boxes.

New-age building technology

The Bandra Worli Sealink is the first of its kind in a number of ways. A number of unique equipment are being used in this project. The unique distinguishing feature of this project is deployment of Asian Hercules, one of the biggest floating sheerleg cranes in the world, for shifting of 1200 MT Launching Girders in sea and specially manufactured equipment for erection of cable stay bridge segments.

1.40 lakh cars a day

The eight-lane flyover will have capacity of carrying about 1.40 lakh cars per day. Large multi-axel vehicles and two-wheelers would not be allowed on the sea link. Speed limit would have to be maintained at 100 km/hr. As the project is being implemented on BOT basis, there would be a minimum toll of Rs 30 per vehicle.

Did You Know?

Length of the steel wires used is equal to the circumference of the earth.Weight of the Sealink Bridge is equivalent to the weight of 50,000 African elephantsHeight of the cable-stay towers equals that of a 43 storied building and the length of the Sealink Bridge is 63 times the height of the Qutub Minar

Many `firsts' to its credit

The Bandra Worly sea link project has certain unique features. These include:--An 8-lane bridge with 2 lanes dedicated for buses.--Unique bridge design for the Link Bridge to emerge as a land mark structure in the city.--Single tower supported 500 metre long cable-stayed bridge at Bandra Channel and twin tower supported 350 m cable-stayed bridge at Worli Channel for each carriageway.--Modern toll plaza of 16 lanes with automated toll collection system.--An intelligent bridge with state-of-art systems for traffic monitoring, surveillance, information and guidance, instrumentation, emergency support, etc.--Development of promenade and landscaping to enhance the environment.

Stress-free driving

Several benefits will accrue from the project. They include:--Estimated savings in Vehicle Operating Costs (VOC): Rs. 100 Crores per annum.--Considerable savings in travel time (20 to 30 minutes) due to increased speed and reduced delays (23 signals avoided)--Stress-free driving.--Reduced accidents.--Reduction in traffic on existing roads because of traffic diversion to the Sea Link. --Reduction in Carbon Monoxide and Nitrogen Oxide Levels in Mahim, Dadar, Prabhadevi and Worli along existing roads.--Reduced noise pollution in Mahim, Dadar, Prabhadevi and Worli along existing roads.--No adverse effect on fisheries, marine life and livelihood of fisherman.--Landscaping along the approaches and waterfront promenade will enhance the environment and add green spots to the city.

Another feather on HCC cap

HCC has been executing some of the most exciting and challenging projectsin Indian history. The major engineering landmarks include the world's longest barrage at Farakka in West Bengal, India's first underground metro at Kolkata and the second one in New Delhi, the Mumbai-Pune Expressway–India's first six-lane expressway-the unique double curvature arch dam at Idukki in Kerala and one of Asia's largest breakwaters at Ennore Port in Tamil Nadu. One ambitious project under way is the Nimoo Bazgo Hydroelectric Project in Leh Ladakh at an altitude of 11,000 feet in Jammu and Kashmir . Source: India Syndicate Image courtesy: Hindustan Construction Company LtdClifford Stoll  - "The Internet is a telephone system that's gotten uppity."

Fwd: [WorldIsmailis] ::: Mumbai gets a new landmark-Bandra

Bandra-Worli Sea Link: An engineering marvel Mumbai gets a new landmark   Mumbai will get a new landmark with the completion of the work on the 5.8 km long Bandra-Worli Sea Link project. The project is a 8-lane, cable-stayed bridge with pre-stressed concrete viaduct approaches, which will link Bandra and the western suburbs of Mumbai with Worli and central Mumbai. The Rs 1306 crore project of Maharashtra State Road Development Corporation (MSRDC) is being executed by Hindustan Construction Company and is likely to be completed by January 2009. The Maharashtra government has announced the extension of the sea link by another 3.6 km up to Haji Ali at an additional cost of Rs 1,200 crore.   Far-reaching impact Bandra-Worli Sea Link Project has the potential to bring about permanent and far-reaching changes in the travel patterns of the area. The link will provide a fast moving outlet from South Mumbai to the suburbs in the west. This link will also help in reducing the present congestion on the Mahim Causeway (which is the only link available at present between western suburbs and south Mumbai) and Western Express Highway . Better connectivity The sealink is the first phase of the Western FreeWay Sealink proposed to be built to improve the connectivity between the island city of Mumbai and its western suburbs. This link will be followed by a link from Worli to Nariman Point with dispersal to Cuffe Parade. The Sealink will also be supported by a series of flyovers, rail link, roadways and other public facilities. Challenging task The project envisages construction of 8 lane Sea link freeway from the interchange of Mahim intersection at the Bandra end to Worli Sea face on Khan Abdul Ghaffar Khan Road . The Construction of the sea link project is divided into four packages namely Package I,Package II, Package III and Package IV. The Package IV executed by HCC forms the main and the most technically challenging construction package of this project. Salient features Bandra-Worli Sea Link project has 9 approach bridge modules and two cable stayed bridges. Each approach bridge module comprises two independent carriageways. The deck of the carriageways consists of triple cell precast box girders supported on piers founded on independent substructure. The cable stayed main bridge has two similar precast triple cell boxes. New-age building technology The Bandra Worli Sealink is the first of its kind in a number of ways. A number of unique equipment are being used in this project. The unique distinguishing feature of this project is deployment of Asian Hercules, one of the biggest floating sheerleg cranes in the world, for shifting of 1200 MT Launching Girders in sea and specially manufactured equipment for erection of cable stay bridge segments. 1.40 lakh cars a day The eight-lane flyover will have capacity of carrying about 1.40 lakh cars per day. Large multi-axel vehicles and two-wheelers would not be allowed on the sea link. Speed limit would have to be maintained at 100 km/hr. As the project is being implemented on BOT basis, there would be a minimum toll of Rs 30 per vehicle. Did You Know? Length of the steel wires used is equal to the circumference of the earth.Weight of the Sealink Bridge is equivalent to the weight of 50,000 African elephantsHeight of the cable-stay towers equals that of a 43 storied building and the length of the Sealink Bridge is 63 times the height of the Qutub Minar Many `firsts' to its credit The Bandra Worly sea link project has certain unique features. These include:--An 8-lane bridge with 2 lanes dedicated for buses.--Unique bridge design for the Link Bridge to emerge as a land mark structure in the city.--Single tower supported 500 metre long cable-stayed bridge at Bandra Channel and twin tower supported 350 m cable-stayed bridge at Worli Channel for each carriageway.--Modern toll plaza of 16 lanes with automated toll collection system.--An intelligent bridge with state-of-art systems for traffic monitoring, surveillance, information and guidance, instrumentation, emergency support, etc.--Development of promenade and landscaping to enhance the environment. Stress-free driving Several benefits will accrue from the project. They include:--Estimated savings in Vehicle Operating Costs (VOC): Rs. 100 Crores per annum.--Considerable savings in travel time (20 to 30 minutes) due to increased speed and reduced delays (23 signals avoided)--Stress-free driving.--Reduced accidents.--Reduction in traffic on existing roads because of traffic diversion to the Sea Link. --Reduction in Carbon Monoxide and Nitrogen Oxide Levels in Mahim, Dadar, Prabhadevi and Worli along existing roads.--Reduced noise pollution in Mahim, Dadar, Prabhadevi and Worli along existing roads.--No adverse effect on fisheries, marine life and livelihood of fisherman.--Landscaping along the approaches and waterfront promenade will enhance the environment and add green spots to the city. Another feather on HCC cap HCC has been executing some of the most exciting and challenging projectsin Indian history. The major engineering landmarks include the world's longest barrage at Farakka in West Bengal, India's first underground metro at Kolkata and the second one in New Delhi, the Mumbai-Pune Expressway–India's first six-lane expressway-the unique double curvature arch dam at Idukki in Kerala and one of Asia's largest breakwaters at Ennore Port in Tamil Nadu. One ambitious project under way is the Nimoo Bazgo Hydroelectric Project in Leh Ladakh at an altitude of 11,000 feet in Jammu and Kashmir . Source: India Syndicate Image courtesy: Hindustan Construction Company Ltd

City skyline set to change as SC okays clusters of towers

Citing Quality Of Life, Court Upholds Huge FSI For Redevpt Of Old Bldgs

New Delhi: The face of Mumbai will change forever as the Supreme Court on Thursday greenlighted the pulling down of all pre-1940 buildings, including chawls, to make way for highrises. 

    The highrises that would be constructed by the developers to replace over 16,000 old buildings, which are eligible for being pulled down and redeveloped, would have to accommodate the present tenants of the old buildings. 
    This means they would move from their dilapidated tenements and occupy flats with a minimum area of 225 sq ft in brand new buildings at no cost. However, in lieu of the free rehabilitation of tenants, the builder can make profits by exploiting a portion of the land to construct a tower which he can sell in the open market. 
    A bench comprising Justices Arijit Pasayat and P Sathasivam upheld the Development Control Rule 33(7) as amended in 1999 and set aside the limitations on FSI and other restrictions imposed by the Bombay high court. DCR 33(7) will have immediate applicability to 16,502 buildings, which are listed under category 'A' by the Maharashtra Housing and Area Development Authority (MHADA) since they were constructed prior to September 1, 1940. 
    These buildings, irrespective of whether they are dilapidated or not, can now be redeveloped "whenever 70% of the tenants/occupants of such buildings came together along with their landlords for redevelopment of their properties''. They would also be entitled to extra FSI as an incentive. 
    The court accepted MHADA's stand that under the DC regulation, houses with an area of minimum 225 sq ft would be provided free of cost to all tenants in these pre-1940 buildings. 
    While validating DCR 33(7), the bench took into account a survey conducted by the civic corporation in 1980-81 which showed that "30,237 buildings would have crossed their lifespan by 1996''. The Kerkar Committee report also recorded that the vast majority of the buildings would have to be reconstructed, the SC noted. It also relied on a report on the Development Plan for Greater Bombay which showed that way back in 1981, 5,82,200 tenements were required to house the natural growth of population. 
    The SC, clearly relying on facts and figures, also recorded the fact that "in 1991, nearly 73% of the population (living in such buildings) occupied one-room tenements—vertical slums; 18% lived in two-room flats. This meant that more than 90% lived in small areas''. 
HIGHRISE PRESSURE 
WHAT THE SUPREME COURT SAID 
    It is clear that the (state govt's) policy seeks to enhance the quality of lives of those living in very poor conditions The court accepted MHADA's stand that under DCR 33(7), houses with a minimum 225-sq ft area would be provided free to all tenants in pre-1940 buildings. Justifying the rule, it noted that "in 1991, nearly 73% of the tenements were one-room and 18% two-room dwellings. Thus, more than 90% lived in small areas" 
WHAT IS DCR 33/7? 
The controversdial Development Control Rule 33(7) was introduced in 1991 to provide for the reconstruction of old, dilapidated cessed buildings in the island city. It was amended in 1999 to give developers unlimited FSI 
In 2005-06, the Bombay high court lifted its earlier stay and allowed redevelopment, but only of dilapidated buildings. It capped the overall FSI (floor space index) at 4
WHAT THE BOMBAY HC SAID 
    Urban environment of Mumbai is perched on a precipice... dividing line between existence and destruction is so tenuous... 
The HC observed that if all pre-1940 buildings—a vast majority of which are in good condition—were given permission for reconstruction with such a huge FSI incentive, it would lead to extra pressure on all civic facilities and infrastructure. It also said that Maharashtra must take a fresh look at a law that impacts not only thousands of old Mumbai tenants, but also the quality of life in the city 
TALL STOREYS There are 19,642 cessed buildings in the island city. 16,400 of them are pre-1940. About 1,000 buildings are redeveloped and about 1,000-1,500 are considered dilapidated 
THE IMPACT 
Thursday's apex court order comes as a big boon for redevelopers. It gives them almost unlimited FSI, as per the original DCR 33(7). They can now redevelop these buildings (a mere 5 feet apart) for huge profits, as long as they get the consent of at least 70% of the tenants of a building 'HC reading not justified' 
New Delhi: The SC on Thursday upheld unlimited FSI for redevelopment of pre-1940 cessed buildings in the island city. Citing figures, a bench said, "Those occupying large areas constitute only 2.7%. Between 1961 and 1991, the number of households increased to 20,88,000, most of which are only of 100 to 120 sq ft.'' 
    "It is thus clear that the policy is to enhance the quality of lives of those living in such poor conditions,'' said Justice Pasayat. The HC was not justified in reading additional requirements into DCR 33(7) after holding the same to be valid, the bench said. The public spirited petitioners who had filed the original PIL before the HC in 2004 had been concerned with the problem of congestion of the population of the island city, which covers the area from Colaba in the south to Mahim and Sion in the north. 
    "The infrastructure in the island city, particularly with respect to roads, water supply, sewage system, open areas and gardens, is overstretched and under extreme strain,'' the PIL had said, adding that the island city has already reached saturation point in terms of population. 
    According to the Report on the Development Plan of Greater Bombay, 1966, the total acreage of the island city is 17,388.83 acres and the ultimate population, which it can accommodate, is 32.5 lakh. An estimated 33.4 lakh people were already residing in the island city two years ago.

Princess Margaret  - "I have as much privacy as a goldfish in a bowl."

Indian to benefit from slowdown in rich countries

NEW DELHI: Globalisation is not a one-way street to corporate conquests abroad and blistering growth at home, experience is teaching India Inc. Hurricanes off the US coast, not to speak of financial turbulence in the West, or rise in political temperature in West Asia can hurt bottomlines in India. 

In these new global challenges, there could be new opportunities as well. A select few of India's corporate elite will get a dekko at these opportunities churning out of global challenges, come September 24, when The Economic Times assembles a truly global panel of experts in the Capital to discuss the theme Slowing global economy: Challenges and opportunities for India Inc. 

Global growth has slowed down, from 4% in 2006 to 3.7% in 2007. The growth rate of world GDP is expected to come down further to 2.7% in 2008, according to the World Bank. Indian economy is still forecast to grow at 7.7%, a rollicking rate of growth that would be unmatched by any large economy other than China. 

Yet the mood in India is grim, whether on Dalal street where prices are coming down, or for the man on the street who sees escalating prices. A slowing global economy pushes down demand. So, commodity prices have started moderating, including that of oil and steel. 

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Falling oil prices immediately offer some respite to practically everyone, except refineries, which will now have to sell refined products benchmarked against crude prices lower than the ones at which they bought the crude in the first place. 

But will lower oil prices dampen the current, and wholly welcome enthusiasm for new investment in both oil exploration and renewable energy to reduce oil dependence? Most industries would welcome lower commodity prices. But this is not a happy story that rubber growers in Kerala would be willing to buy. 

Higher farm prices boosting rural incomes or lower input costs for industry? Which would benefit the Indian economy in the long run? As slowdown in rich countries forces companies to tighten belts further, it should logically lead to greater outsourcing of work to low-cost destinations, including India. 

But would this devolve as a generalised benefit across India's BPO sector? Or would there be a bias in favour of the bigger BPOs capable of offering genuine process innovation and complex solutions? How protracted would the slowdown be? Does it make sense for the industry to postpone their investment? Would the government's continued emphasis on investment in infrastructure keep domestic capital formation going strong, feeding growth? 

All these questions do not have definitive answers, true enough. But thinkers and doers of the global economy would have insights to offer that would benefit ET's readers. Only a few of them would be able to get together at the Capital's Taj Mahal hotel on September 24 for first-hand insights. But Team ET will make sure that those who could not make it to the event would not lose out on its substantive findings.

Princess Margaret  - "I have as much privacy as a goldfish in a bowl."

HEART-TO-HEART ON INDIA

Slowdown on mind HEART-TO-HEART ON INDIA

GLOBALISATION is not a oneway street to corporate conquests abroad and blistering growth at home, experience is teaching India Inc. Hurricanes off the US coast, not to speak of financial turbulence in the West, or rise in political temperature in West Asia can hurt bottomlines in India. In these new global challenges, there could be new opportunities as well. A select few of India's corporate elite will get a dekko at these opportunities churning out of global challenges, come September 24, when The Economic Times assembles a truly global panel of experts in the Capital to discuss the theme, 'Slowing global economy: Challenges and opportunities for India Inc'. 

    Global growth has slowed down, from 4% in 2006 to 3.7% in 2007. The growth rate of world GDP is expected to come down further to 2.7% in 2008, according to the World Bank. Indian economy is still forecast to grow at 7.7% — a rollicking rate of growth that would be unmatched by any large economy other than China. Yet the mood in India is grim, whether on Dalal street where stock prices are coming down, or for the man on the street who sees escalating prices. 
    A slowing global economy pushes down demand. So, commodity prices have started moderating, including that of oil and steel. 
    Falling oil prices immediately offer some respite to practically everyone, except refineries, which will now have to sell refined products benchmarked against crude prices lower than the ones at which they bought the crude in the first place. But will lower oil prices dampen the current, and wholly welcome enthusiasm for new investment in both oil exploration and renewable energy to reduce oil dependence? Most industries would welcome lower commodity prices. But this is not a happy story that rubber growers in Kerala would be willing to buy. Indian BPOs to benefit from slowdown in rich countries 
    Higher farm prices boosting rural incomes or lower input costs for industry? Which would benefit the Indian economy in the long run? 
    As a slowdown in rich countries forces companies to tighten belts further, it should logically lead to greater outsourcing of work to lowcost destinations, including India. But would this devolve as a generalised benefit across India's BPO sector? Or would there be a bias in favour of the bigger BPOs capable of offering genuine process innovation and complex solutions? 
    How protracted would the slowdown be? Does it make sense for the industry to postpone their investment? Would the government's continued emphasis on investment in infrastructure keep domestic capital formation going strong, feeding growth? 
    All these questions do not have definitive answers, true enough. But thinkers and doers of the global economy would have insights to offer that would benefit ET's readers. Only a few of them would be able to get together at the Capital's Taj Mahal hotel on September 24 for firsthand insights. But Team ET will make sure that those who could not make it to the event would not lose out on its substantive findings.

THE GROUP OF 8: (Back: l-r) Indra Nooyi, Peter Sands,Anshu Jain, Deepak Parekh & Kumar Birla (Front: l-r) Harish Manwani,Azim Premji & Sunil Mittal

Princess Margaret  - "I have as much privacy as a goldfish in a bowl."