‘CELEBRATING LIFE’ IN STYLE Glittering Stars Light up Nita Ambani’s Birthday

Film personalities, India Inc captains and cricketers among 300 invitees     Exotic flowers from Florence, a performance by an Oscarwinning musician, guests that included the country's most beautiful people, Bollywood stars, cricketers and business barons in an exquisitely lit palace in Jodhpur — all made the perfect setting for Nita Ambani's 50th birthday party on Thursday evening.  The wife of Mukesh Ambani, who owns India's largest private sector firm Reliance Industries Ltd and is the country's richest man, played host to a galaxy of celebrities at the Umaid Bhawan Palace. A tree on the grounds was festooned with pictures of invitees, depicting a family tree. The century-old venue, previously known as the Chittar Palace and now managed by the Taj group of hotels under lease from the Jodhpur Royals, was illuminated in gold and white. "The palace is totally mapped with 3D projections and decorated with flowers. It's extravagance never seen before," said a hotel employee. One musician who was to perform said the whole place was decorated with exotic flowers from Florence, in keeping with the theme of the party-—celebrating life.  Another guest who was at the venue said, "I was awestruck by the life-size tree, which was placed right inside the party venue. It has pictures of every guest hung on it and has been specially designed for the party theme."  Security was extremely tight at the venue and in Jodhpur as India's richest men and women descended on the town in Rajasthan for a grand party that will spill over into Friday, when the family celebrates Lakshmi Puja on Dhanteras at the Bal Samand Lake Palace, another luxury hotel about 10 kilometres away from the Umaid Bhawan Palace.  Earlier in the day, dressed in a pink designer salwar suit, Nita Ambani, who manages the Mumbai Indians Indian Premier League cricket team and oversees part of the group's retail business, landed in the town in her private jet with her husband, mother-in-law Kokilaben, daughter Isha and sons Anant and Akash. Guests started arriving in shortly after.  Among the 300 invitees were industrialists Anand Mahindra, Ajay and Swati Piramal, Gautam Singhania, cricketers Sachin Tendulkar (and wife Anjali), Harbhajan Singh and Anil Kumble, actors Aamir Khan, Juhi Chawla (and her businessman husband Jay Mehta), Ranbir Kapoor, Rani Mukherjee, Anil Kapoor, Vinod Khanna and Rahul Bose besides showbiz personalities Shekhar Kapoor, Rakeysh Omprakash Mehra, Ronnie Screwvala and Prasoon Joshi.  Anil Kapoor tweeted pictures of himself on a private jet with fellow actors Kapoor and Khan en route to Jodhpur. A Bangalore-based designer tweeted he had delivered an outfit to Kumble, who is now part of the Mumbai Indians cricket team management. Others tweeted pictures of the palace lit after dusk. A hotel employee said that soon after arriving, the guests had tea with the hosts before dressing up for the party in the evening at which AR Rahman was to perform.  Another guest said the family had "gone out of the way to make everyone feel very welcome".  Mukesh Ambani's birthday gift to his wife wasn't known. He had given her an Airbus business jet on her 44th birthday. With a net worth of $21 billion (. 1,29,150 crore), Mukesh Ambani retained his title as India's wealthiest person for the sixth year in a row, according to the Forbes annual list of India's 100 richest people, released on Tuesday. Clockwise from top: Vinod Khanna with wife Kavita; Anil Kapoor, Ranbir Kapoor & Aamir Khan; and Yuvraj SIngh

Elder Pharma Defaults on 261-cr Interest Payment on Debentures Mumbai-based co had received board nod for restructuring business in July

Elder Pharmaceuticals has defaulted on interest payment of . 261.8 crore on its debentures. The Mumbai-based company markets prescription pharmaceutical brands, surgical and medical devices. "The company has not paid interest due on three debentures totalling . 261.8 crore. It was also required to create complete security by February 19, 2013 on . 70 crore debenture," said a senior banker in the know of the development.  "The securities over the fixed assets of Andheri, Mumbai and North India have been created on November 19, 2012 and May 20, 2013, respectively. However, the security over the fixed assets of the issuer situated at Maharashtra is pending due to non–receipt of NOC from all the existing charge holders," the banker said.  Recently, the company elevated Alok Saxena as its MD and CEO. The appointment was done after the demise of Elder Pharma chairman and managing director Jagdish Saxena on October 10. "Our total debentures are about . 260 crore and therefore the interest due is about . 10 crore," an Elder Pharma official told ET on conditions of anonymity.  The company in July had received board approval for restructuring of the company's business through raising capital, hiving off of assets or other strategic options to reduce debt. The company has a debt of . 1,300 crore on its books. The street is abuzz that Elder Pharmaceuticals may sell its domestic business for around . 2,400 crore.  French multinational pharmaceutical company Sanofi is rumoured to have made the highest bid for the domestic formulation business of Elder Pharma, ahead of Pfizer and Glaxo. Paris-based Sanofi is understood to have bid for all the brands, valuing the Mumbai-based company at . 2,500-2,700 crore. Other contenders such as Glaxo have only shown interest in specific brands, said two official in the know of the development.  Net profit of Elder Pharmaceuticals has declined by 68.9% to . 6.78 crore in the quarter ended June 2013 compared to . 21.8 crore in the corresponding quarter last year. Sales have also declined by 27.7% to . 187.9 crore in the quarter ended June 2013, compared to . 259.9 crore in the corresponding quarter last year.

Jignesh Shah resigns from MCX board Says FMC Can’t Draw Adverse View About Fit & Proper Tag Till Probe Is Completed

Mumbai: Jignesh Shah, founder, vice-chairman and a director of Multi-Commodity Exchange (MCX), resigned from the bourse's board on Thursday even as he replied to a show-cause notice to by Forward Markets Commission (FMC) about why he should not be disqualified from being a 'fit & proper person' to be on the board of an exchange. 

    FMC had slapped the notice on Shah for his alleged role in the Rs 5,600-crore payment crisis at the National Spot Exchange (NSEL), a group company of MCX, the only listed exchange in the country. 
    The 'fit & proper person' test for a person to be on an exchange's board requires that he/she should be honest, with high integrity, a good reputation and solvent. Regulators in India take into account all these factors before allowing a person to be either a shareholder-director or an independent director on an exchange's board. 
    Shah's resignation came exactly three months after the NSEL scam came to light. Shah, along with some others, set up MCX from the scratch over the last decade — it is now one of the largest commodity bourses in the world. Shah was on the board of MCX as a nominee of Financial Technologies (FTIL), the main promoter of the commodities bourse. 
    Shah has already resigned from the MCX Stock Exchange (MCX-SX). He, however, continues to be a director on the boards of FTIL and NSEL. 
    The resignation came at a time when the economic offences wing of the Mumbai Police has taken some of the former top NSEL officials into custody, and also Nilesh Patel, the promoter of N K Proteins, one of the biggest borrowers of the exchange which owes investors about Rs 970 crore. 
    On Wednesday, Mohan India, another large borrower in NSEL, agreed to pay Rs 600 crore to settle its dues that totalled about Rs 770 crore. There are talks that Patel is also on the verge of paying up Rs 600 crore to settle his dues with the commodity bourse. 
    In his reply to FMC's showcause notice, Shah pointed out that proceedings initiated by various agencies into the NSEL fiasco were pending and, hence, it would be premature to draw any adverse inference either against him or FTIL on account of such proceedings, sources said. Shah also defended his position as a qualified board member of the bourse on the basis that neither him, nor FTIL has been found to have played any role in the NSEL scam.

Jignesh Shah

Loan defaults stall two mega townships

Mumbai:Real estate firm Hirco has defaulted on payments to lenders for its two large Rs 1,000 crore-plus townships in Panvel and Chennai, casting a shadow on the future of the projects. 

    Work on the firm's project in Panvel, Raigad district, has been stalled for the past few months. The project has a mix of commercial and residential properties and is spread over 300 acres. More than 1,000 apartments are believed to have been sold in Panvel. 
    Hirco claims to have more than 66 million sq ft of development in the two township projects being built by its subsidiary, Hiranandani Palace Gardens. 
    Following the default, the residential township outside Chennai, the Hiranandani Palace Gardens, is under threat of a takeover by the lenders, TOI has learned.HDFC may sell off Hirco's Chennai property 
Mumbai: Two mega township projects undertaken by Hirco have run into trouble following loan defaults by the developer. HDFChad advanced aroundRs 500 crore in two tranches to the Chennai projectjointly promoted by Niranjan Hiranandani and his daughter Priya. Both have since stepped down from theHircoboard.Itisbeing built in three phases on an over-200 acresprawl. 
    The lender has already classified the first tranche as an NPA (non-performing asset) and will classify the second tranche similarly. It plans to send a notice to the firm for repayment under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act(SARFAESI). 
    If Hirco fails to pay up, HDFC will attach the Chennai property estimated to be worth several times the loan. The property would then be auctioned.Marketsourcessaidone of the Hiranandanis may bid for it. "Because of a family dispute, neither family member is willing to bring in fresh capital for the project. With RBI norms becoming stricter on project lending, there cannot be any progress unless promoters bring in money,'' said a source familiar withthedevelopment. 
    Early this year, Tata FinanceCapital Servicesdragged thecompany tocourtfor a term loan default of Rs 76 crore, and demanded the company's liquidation for non-payment. 
    Hirco's chief financial officer, Samir Shroff,wasunavailable for comment and did not respond to text message and phonecallsseeking comment. 
    A Hiranandani Constructions spokesperson said, "Niranjan Hiranandani resigned from Hirco Plc around 22nd December 2010. This knowledge is in public domain. Hence the details of the companies, which you areseeking now,is not available with us." It is learned that Hiranandani has made an offer tobuy outthecompany. 
    "It's a mismanaged company," said a former executive. "A 1.75 million sq ft commercial building in thePanveltownship is 75% complete. It could easily fetchRs500crore." 
    Hirco, listed on the London Stock Exchange's Alternative Investment Market, was set up in 2006 to invest in residential andcommercialcomplexes. 
    On June27,chairman David Burton said in the company's half-yearly statement that progress on the developments appearedsomewhatsubduedwith only moderate progress in the last six months. The company had said in its annual financial statement in September 2012 that the completion of both the Chennai andPanvel projects remained atleast a decade away. 
    "While information flow on the projects remainsunsatisfactory and we have no real clarity over who is really in control of the projects, what does seem clear is that completion will needsubstantialfurther investmentof bothequity andlongertermdebt," Burton hadsaid. Infra problems, title disputes plague affordable homes on city's fringes 
Mumbai: The affordable homes market, thriving on the outer fringes of Mumbai, is beset with problems like lack of infrastructure, poor transport connectivity, issues of land titles and delayed clearances. 
    In 2008, many developers who rode the real estate boom by catering mainly to high-income buyers started enticing lower and middle class clients with smaller properties outside Mumbai limits when the market slowed down. These locations are 60 to over 100 km from Mumbai. But they claimed to have registered brisk sales of smaller flats in places like Boisar, Virar, Panvel, Kalyan, Shahpur, Ambivali and Karjat. These homes cost anywhere from Rs 10 lakh to Rs 35 lakh. 
    But despite frenzied construction in these far-flung places, problems soon arose. Buyers realized that in several of these locations, there was barely any social infrastructure like schools, markets, hospitals and restaurants. Some projects are located 8-10 km from the nearest railway station. Builders too found that permissions from local civic bodies were inordinately delayed. 
    In Vasind near Shahpur, Tata Housing had to scrap one of its affordable homes projects because environmental clearances got stuck in red tape. In Karjat, only phase I of a large low-cost project by Tanaji Malusare City was completed. The remaining phases have failed to take off despite a huge initial demand. 
    Experts said that despite the slowdown in the property market, demand for affordable homes is eight to ten times more than luxury apartments. Shubhankar Mitra, head, strategic consulting (west), Jones Lang LaSalle India, said, "Anticipated supply in this segment is 50,000 to 60,000 tenements. Most of the supply comes from grade B and C developers offering flats in the range of Rs 2,500 to Rs 3,500 a sq ft." 
    "Infrastructure is not adequate. This pushes up the cost, making the project unviable for many developers," added Mitra. 
    Concurred Pankaj Kapoor of Liases Foras, a property research firm, "Locations like Panvel still lack the livability factor. You require human mass for infrastructure to come up and this may take another decade." 
    He said the affordable homes market is relatively better than the luxury one. "Sales to inventory ratio is higher than the luxury segment. The current stock of expensive flats will take at least 100 months to sell. The affordable ones have an inventory of about 30 months, although ideally it should be about 11 months," he added. 
    Builder Nayan Shah of Mayfair Housing, which builds luxury apartments in suburban Mumbai, branched out into the affordable sector a few years ago with a project in Virar. "There is good demand from people who want to sell their tenements in Mumbai and move to a larger, cheaper home further away from the city," he said. 
    Developer Nayan Bheda of Neptune Group blamed the government for not promoting affordable housing. "Permissions don't come in time and there is little support from the local municipality," he said.

1,000 flats have been sold in the 1,000cr Hirco township in Panvel

Hirco's 2012 financial statement said the Panvel and Chennai projects will take at least 10 years

Despite frenzied construction in farflung places like Virar and Shahpur, there is barely any social infrastructure in like schools, markets, hospitals and restaurantsin several areas

Destination Central Asia

Whilst China has made a huge play for energy assets in five countries of the region, the Indian government is working out a strategy to grab a slice of its natural resource pie

 Historical relations cannot always be a yardstick for deep ties in future. Foreign policy is often guided by pragmatism and national interests often guide realpolitik and bilateral relations. While India has deep historical and cultural ties with Central Asia, the energy-rich region is now courting China like never before. Cash rich-China is all over five Central Asian states with energy deals, pipelines and road and railway projects. 

    India, with its limited resources, remains undeterred. After launching its 'Connect Central Asia' policy last year, Delhi is developing a strategy to partner countries like Germany and Turkey to get a share of the natural resources in the region. Besides oil and gas, energy-hungry India is eyeing imports of uranium from both Kazakhstan and Uzbekistan. Beyond natural resources, the strategy is to focus on education, IT, pharmaceuticals and medical tourism, amongst other sectors, where India has developed expertise over the years. 
India Moves, but Slowly 
There has been a flurry of visitors from India — vice-president Hamid Ansari, external affairs minister Salman Khurshid and minister of state for external affairs E Ahamed — to the region in the past two years. Among them Ansari and Khurshid visited the region twice this year as part of Delhi's 'Connect Central Asia' policy. 
    In September, in a surprise move India held consultations with China on expanding its presence in the landlocked region. "While we told the Chinese that India will continue with its strategy of capacity building, we also quietly informed them that India remains as much interested in natural resources as China and will continue to pursue its interests," an official involved in consultations with the Chinese told ET Magazine. However, Indian economic interests in Central Asia are not limited only to energy resources, but also other raw materials vital for industrial production such as iron ore, coal and other minerals. 
    The dialogue took place in the backdrop of a snub to India when it tried to enhance its presence in the energy sector of the region's largest country. The Kazakh government awarded a stake in the Kashagan oilfield in the Caspian Sea to the Chinese state-run China National Petroleum Corporation (CNPC) after it blocked the sale of the stake of US firm ConocoPhillips to ONGC Videsh Ltd (OVL). 
    China's engagement with the region has progressed in phases and is centered on strengthening economic relationships, and addressing threats of security emanating from the region due to terrorism, extremism and Islamic radicalism. China has extended economic aid both through the mechanism of the Shanghai Cooperation Organisation (SCO) as well as on a bilateral basis by providing substantial loans to the five states. Other than oil, Beijing is keen on investing in precious resources like tungsten and uranium mines. 
    "While India is accepted by all five Central Asian Republics, India's delivery mechanism is very slow. Indian private companies do not take enough interest in this region," says Meena Singh Roy, a research fellow at the Institute for Defence Studies and Analyses and an expert on Central Asia. "China with its economic might is obviously able to penetrate into the region faster than India. While India invests in millions, Beijing invests in billions in Central Asia." 
    The Indian government, according to its policy paper, is looking to Central Asia as a long-term partner in energy, and natural resources. Delhi, like, Beijing, is also eyeing large cultivable tracts of land in the Central Asian states for production of profitable crops with value addition. 
Strategic Slot 
Energy apart, Central Asia is an area of vital importance to India because of the common challenges they face from extremism and terrorism. India considers the region as its extended neighbourhood and thus has strategic security and economic interests in the region. Instability in Afghanistan poses a serious threat to the security of India and the Central Asian states. According to the Connect Central Asia Policy, "India will strengthen its strategic and security cooperation. India already has strategic partnerships in place with some Central Asian countries. In focus will be military training, joint research, counter-terrorism coordination and close consultations on Afghanistan." 
    The Central Asian Republics (CARs) have also been voicing their support for greater Indian participation in the region. Events in Afghanistan have a spillover effect on the CARs, and an unstable and unfriendly government in Kabul post-2014 when US troops withdraw could create serious security implications for India, both internally and externally. Therefore, stability in this region is in both India's as well as the CARs' interest; it also opens up a new opportunity for cooperation. In fact, India sees the CARs as potential partners in fighting the menace of religious extremism, ensuring its energy security and expanding its trade network. India's three pillars of strategic partnership with the region now are defence ties, counter-terror and stabilising Afghanistan. Away from the public glare, India's only military base abroad (the Ayni air base) is in Tajikistan. This is strategically located as it would assist Indian operations in Afghanistan if need be. 
Soft Diplomacy 
That India is currently focusing on its strengths is clear from the fact that it is ready to extend cooperation by setting up civil hospitals and clinics in Central Asia. India is working on setting up a Central Asian e-network with its hub in India to 
    deliver tele-education and 
    tele-medicine connectivity, linking all the five Central Asian states. In 2009-10, India had successfully launched the PanAfrica e-network connecting all countries in the continent. 
    The country's higher education system delivers at a fraction of the fees charged by Western universities. Keeping this in mind, India would like to assist in setting up a Central Asian University in Bishkek, the capital of Kyrgyzstan, which could come up as a centre of excellence to impart world-class education in areas like IT, management, philosophy and languages. 
    The government is also looking at opportunities for Indian companies to showcase their capability in the construction sector and build world-class structures at competitive rates. Central Asian countries, especially Kazakhstan, have almost limitless reserves of iron ore and coal, as well as abundant cheap electricity. India also plans to set up several medium-sized steel rolling mills, producing its requirement of specific products. 
    However, the biggest impediment for India is the absence of a direct land route to Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan. China, which shares a land boundary with some of these states, has a huge natural advantage over India in this regard. The absence of a land route has impacted India's commercial engagement with the region in a big way.
    Avers Nirmala Joshi, an expert on Eurasia and Central Asia, and a former professor at 
    the Jawaharlal Nehru University, Delhi: "The geographical proximity and economic might have made China a key partner for the Central Asian Republics. The Chinese system also complements the system in the Central Asian states. India's slow 
    delivery mechanism is also not helping Delhi's cause." She adds that the Chinese are now one step ahead in entering the Exclusive Economic Zone of Uzbekistan. "India must work out its smooth connectivity route to Central Asia through Iran to bolster its presence there. Central Asia will become geopolitically important after US troops withdraw from Afghanistan next year." 
    To address this India has reactivated the International North-South Transport Corridor (INSTC). The corridor is the ship, rail and road route for moving freight from South Asia to Europe through Central Asia, the Caucasus and Russia. The route primarily involves moving goods from India via ship to Iran. From Iran, the freight moves by ship across the Caspian Sea or by truck or rail to southern Russia. From there, the goods are transported by truck or rail along the Volga River through Moscow to northern Europe. The corridor will have its starting point from JNPT port in Mumbai, and via transhipment the goods will reach Bandar Abbas port (near Strait of Hormuz) in Iran; the plan for the corridor includes building a railway link between Iran, Turkmenistan, Kazakhstan and eventually Russia. If the proposed railway line is transformed into reality then trade with Afghanistan may also be possible. Simultaneously, the importance of a $7.6-billion Turkemenistan-Afghanistan-Pakistan-India gas pipeline project as a transit route between Central Asia and South Asia through Afghanistan cannot be undermined. 
    The Iranian port of Chabahar will serve as India's gateway to Afghanistan through the Zaranj-Delaram Roadway (ZDR) in Nimroz province, built with India's assistance. India will invest in the expansion of Chabahar port. The ZDR is connected to the Garland Highway, which links up with Central Asia. The port's expansion and connection with Afghanistan will deepen India's ties with energy-rich Iran; help it access Central Asian markets without relying on Pakistan; through the Iranian port of Bandar Anzali on the Caspian coast India will be able to get access to Russia; and most importantly ZDR will help India connect with Afghanistan and Central Asia, bypassing Pakistan. 
'Sunrise' Region 
Today India's engagement with Central Asia, both politically and economically, is on the rise, but without greater access to the countries in the region. New Delhi cannot take optimal advantage of the region's rich natural resources such as oil and gas, uranium and other minerals. "The Central Asian states point out that while they are doing business with China, their heart is with India. Yet the full potential of the relationship has not been realised due to impediments like the absence of direct road access to the five states of the region," a government of India official pointed out. Absence of a viable banking infrastructure in the region is a major barrier to Indian trade and investment. 
    India also wants step up multilateral engagement with Central Asian partners using the synergy of joint efforts through existing fora like the SCO, Eurasian Economic Community (EEC) and the Customs Union. India has already proposed a Comprehensive Economic Cooperation Agreement to integrate its markets with the unifying Eurasian space. With Russian support, Delhi is pushing hard to become a member of SCO. 
    Central Asia is a 'sunrise' region for Indian businesses and there is immense scope for greater annual trade turnover with the five CARs, which now ranges between $22 million and $360 million. That can only happen when the INSTC is fully functional. 
•

Vice-president Hamid Ansari, foreign minister Salman Khurshid and minister of state for external affairs E Ahamed have visited the region in the past two years

Why Walmart Can Say Bye to Bharti But Not to India

Falling sales in its home market, mixed growth in other markets and the huge growth potential in India mean the retail giant will grin and bear the uncertainty here When Walmart Stores Inc, the world's biggest retailer, and Bharti Enterprises decided earlier this week to go their separate ways, there were few gasps or shake of heads. Actually, we could be forgiven for thinking that it took them so long to end it.      The alliance promised much when it was launched six years ago, but delivered little. Why? The reasons are plenty.      The first reason has to be the vague FDI rules. Previously, foreign retailers were allowed only in the wholesale, or cashand-carry, business, which Walmart took advantage of to enter India. The government eased rules in September 2012, paving the way for foreign retailers to enter the front-end retail format too. But Walmart was reluctant to introduce this format as the rules were vague and restrictive. The rules have discouraged other foreign retail majors too to invest in the country. Even on the cash-and-carry front, Walmart did not open a store in India for about a year despite earlier plans to open eight in 2013.  Rocky Path  Of course, FDI rules weren't the only reason. Walmart has been facing a decline in like-for-like sales (a comparison of a year's sales to the previous year's sales of a company in its home market), closed several stores in China and has still to complete introduction of EDLP pricing (promise of the lowest available price) strategy in Latin America. With the deteriorating outlook for generated profits, the retailer had to set priorities and revise its international expansion plans.      Walmart is also smack in the middle of an internal anti-bribery probe launched in the US in November 2012. That probe invited an investigation by India and consequently, led to the suspension of several top managers. It didn't help that Walmart spent $25 million between 2008 and 2012 in India on various lobbying activities to facilitate its entry.      Unfortunately, the incident played into the hands of opponents of FDI rules in retail. Here, Walmart should have tended to its garden the Ikea way. The Swedish furniture retailer too has a proven record of lobbying in India. But Ikea, a single-brand retailer, spent lots of effort and time in negotiations to get a clarification on FDI rules in single brand retailing before it decided to expand in the country.      It is safe to assume that Bharti was viewing these developments with discomfiture. For some time, it was reconsidering its commitment to the partnership by pointing to "distant prospects of returns". In July 2013, Bharti Retail returned 17 properties which it had leased across the country to open Easyday stores, back to landlords. This was a clear indication that there would be no more joint plans to develop a front-end retail network. It is possible, in the context of these developments, that some bitterness crept between the two partners, exacerbated  later by a seeming clash of cultures. So it's not surprising that Walmart was keen to end its relationship.  Bet on India  But what about the relationship with India? Make no mistake — Walmart will stick around. Indeed, in its statement announcing the split, Walmart has said that it will work with the government to create "conditions that enable FDI in multi-brand retail."      However, it would be wrong to expect that Walmart would wait for a perfect setting — like 100% ownership in the multi-brand retail. Consumer and market knowledge of a local partner will be crucial (it has no choice but to find another Indian partner to own 49% of the business to establish its retail stores).      Therefore the retailer may replicate in the country a strategy which proved to be successful in other emerging markets. A      new JV partnership or an acquisition of a minority stake in a local player with an option to gain a majority stake later could be on the cards. Walmart has expanded in Mexico through a JV and through an acquisition of a minority stake in Japan and China.  Walmart cannot give up on India because of the potential of its retail market. India is set to become the world's third-largest retail market by 2018, with food retail format sales accounting for $1,066,922 million, following China ($3,160,917 million) and the US ($1 442 146 million).  Road Ahead  Walmart is unlikely to repeat the mistake it made in another key emerging market, Russia, where it failed twice to grabM&A opportunities. Today, an entry into Russia via the organic route is extremely risky and M&A opportunities are limited. Walmart's missed opportunity in Russia is in sharp contrast to the fortunes of French retail powerhouse Auchan, which has grown in the country annually by 22% (in dollar terms) in the past five years.      For now, Walmart will have to be content with its existing cash-and-carry business (it may put the expansion of frontend retail on hold for two years). That gives a great advantage to local players to improve efficiency as well as to foreign players like Auchan and Tesco. While the former will be quickly opening its hypermarkets in a franchising agreement with Landmark Group, the latter will be testing small retail formats in cooperation with its franchisee partner Trent.      Despite its difficulties, Walmart has good prospects at least in the Indian cash-and-carry retail. This sector is fragmented and nascent at that. Walmart-Bharti opened its first BestPrice Modern Wholesale cash-and-carry outlet in 2009. It has since expanded to 20 stores, making it the second-largest in India.      Walmart's closest competitor in this format in India is Metro Group. Whereas Metro has only lately expanded into tier II and tier III cities, Walmart Bharti has a first-mover advantage. Carrefour and Booker operate only a few stores while Reliance Retail has started to invest into this format only recently.      Despite the limited competition, Walmart does not generate profit in India. Bharti Walmart's annual loss grew 34% to 372.32 crore ($63.9 million) for the year ended December 31, 2012, from a year ago. This was despite an 80% increase in its total revenue at 3,381 crore against 1,876 crore the previous year. The accumulated losses as of December 31, 2012, stood at 1,137.7 crore.      Yet, these are early days to wager a judgement. Many foreign retailers operating in emerging markets need up to 10 years to break even. Though front-end retail looks a long term goal, exit from a lucrative market like India would not be smart. Walmart should stick to its cashand-carry format for now. Due to the absence of structured wholesale networks, especially outside large cities, India offers a great potential for its Best Price Modern Wholesale stores. No one these days can afford to ignore India. Not even the world's biggest retailer.  •  The writer is a research director and head of emerging markets at Planet Retail, a global retail consultancy

First Round of Battle for 2014 Starts November Single-phase polls in 4 states, two-phased in Chhattisgarh; EVMs to have option to reject

Election season 2013-14 has begun. Eleven crore voters in five states will exercise their franchise between November 11 and December 4 — according to the assembly election schedule announced by the Election Commission on Friday. The votes will be counted on December 8.  The fate of four high-profile chief ministers will be decided in the polls, and the results will be read for clues to the big fight — general elections in 2014.  Although Delhi, Madhya Pradesh, Chhattisgarh and Mizoram represent a relatively small part of the Indian electoral map, these assembly elections are being seen as a sort of a test run for Congress and BJP, which are pretty much face to face in all the electionbound states barring Mizoram. These state elections will be the first to offer voters the 'None of the Above' (NOTA) choice in the electronic voting machines. This comes after the recent Supreme Court ruling in favour of such an option for voters.  These polls will also see the political debut of Arvind Kejriwal and his Aam Aadmi Party in the elections for Delhi assembly. Total of 1.3 Lakh Polling Stations  Sheila Dikshit and Ashok Gehlot of Congress, in Delhi and Rajasthan, respectively, and Shivraj Singh Chouhan and Raman Singh of BJP, in MP and Chhattisgarh, respectively, are the two national parties' high-profile CMs in the contest. Dikshit, Chouhan and Singh have all overcome incumbency before. Chhattisgarh will be the first state to go to polls and voting will be done in two phases because of security threats from Maoists. Madhya Pradesh, Rajasthan, Delhi and Mizoram will follow, but will have singlephase polls.  There will be 1.3 lakh polling stations in the five states, and the model code of conduct has come into immediate effect.  These assembly elections will be read closely for any indication of a national mood either for Narendra Modi-led BJP or Congress. Shock defeats will not sit well with preparations for the national campaign. Pundits and politicians will examine the results for signs of what may come in a few months time.