e globuzz oct dec issue
TRANSCRIPT
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E - G L O B U Z Z
Faculty Mentor-
Prof. C.P. Joshi
EditorSanghmitra VarmaSayoni MaitraDivya MidhaHardik DhagaiMeenakshi Vyas
DesignersManu Manaswi
Aayush VelagaAnkur Chauhan
Did you know?Trimurti GuptaSanghmitra Varma
Circulations
Praneeta Shukla,Sabika Naqvi
All the views expressedin this magazinereflect the personalopinions and views ofthe authors and do notreflect IBS@SIMSR
views
A TRIBUTETONELSONMANDELA
COVERSTORY
US FEDERALSHUTDOWNOF2013
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KNOWLEDGECENTRE
BITCOIN: BREAKINGMONETARYBARRI-ERS
IBS UPDATES
IBS LAUNCHESITSNEWLOGO
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PANGEA2013 BYIBS@SIMSR
IBS CELEBRATESITS4THANNIVERSARY
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Nelson Mandela, South Africas first President,
who transformed the country from apartheid
to a democracy and emerged as an interna-
tional icon of justice, passed away at the age
of 95 on 5thDecember, 2013. By the time of his death, he
was declared as the greatest persona of mankind. The
idea of greatness now retires into the historical shadows.
As the saying goes Death is not the greatest loss. The
biggest loss is something that dies inside us while we
continue to exist. But everything has not come to an end,
as he has left us with a great legacy richer than anything
money can buy. He endured great personal hardship when
he was imprisoned for nearly three decades, so that oth-ers could have a life full of dignity, equality and opportu-
nity. He fought against discrimination and exclusion, but
rose above hardest of the evils to heal and reconcile a
fractured nation. He lived his life by virtues of honesty,
trust sharing with peace, without even once compromising
on his beliefs or his principles.
"India, in particular, had great affection and regard for
him. Inspired by Mahatma Gandhi's principle of Ahimsa
(non-violence), his mission was a moral bulwark for our
principled struggle against apartheid in South Africa that
was marked by violent attacks during those days. It also
reflected Indias fight for a world free from violence. We
were highly honored when Nelson Mandela accepted
Bharat Ratna, the highest Indian civilian award, much be-
fore being conferred with the Nobel Peace Prize in 1993,
which he shared with Mr. Klerk, who helped him to get a
release from the prison three years earlier than the de-
clared sentence. Mr. Klerk also bought peace to the ongo-ing apartheid.
Nelson Mandela is one of the most inspirational people
without whom we would have been living in a largely
restricted world even today. Apart from making a differ-
ence to the quality of life globally, he did serve the world
with many other teachings too. He inspired us to believe
that no hurdle is too big; no way is too hard to choose, and
no rival is so powerful for us to quit. The sun keeps rising
each day, necessarily not as bright as yesterday, but theshow must go on!!
The important message he delivered to the world is that
forgiveness is not our weakness. It was evident when he
quoted: Its reconciliation & forgiveness but at no cost any
form of revenge. He was crystal clear about the fact that
just as it could not be a country of white men in power; it
could not be a country of black domination either. In the
future, the majority would need the minority and vice-
versa. Ultimately there is a power in forgiveness too, bothin granting and seeking it.
In a true sense, he showed us the path of truth and
strength of human spirit inspiring us in many ways with his
work, his life and his words. The legacy he has left us with
is one we will always cherish and we will always thank God
for Nelson Mandela. Let us all join together to mourn the
legend who never differentiated any individual on the ba-
sis of their ethnicity and saw everyone as a human being
to be treated with equal respect and dignity.
May his soul rest in peace knowing that he leaves behind
many who will always continue his struggle, his fight and
carry forward his legacy.
Shagun Changoiwala (PGDM-IB, 1stYear)
A Tribute to Nelson Mandela a true
statesman; a man destined to lead and
a freedom icon
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US Federal Government shutdown occurs when
laws funding the government are not passed
by the Congress. The US governments fiscal
year is from October 1 to September 30 and these laws
need to be passed for proper functioning as mentioned in
the US Constitution. Government
shutdown doesnt imply that US
has no government. Services im-
portant for law and order defi-
nitely function normally. Other
departments function only with
minority of their staff reporting
and performing basic functions. Some of the government
institutions are entirely shut down.
Till date, the US has faced three major federal government
shutdowns. The first shutdown took place in 1978 and
lasted for 18 days, when Jimmy Carter was the president.
The issue was related to a defence bill which included the
funding of a nuclear-powered aircraft carrier. In 1995-
1996, the second shutdown which lasted for 21 days,
took place during Bill Clintons tenure as the president.
This shutdown was caused due to the conflict in funding
of Medicare, education, environment and public health in
the 1996 federal budget. The recent shutdown took place
from October 1 to October 16, 2013 under the presidency
of Barrack Obama. This shutdown resulted due to the fail-
ure of the Congress to pass a law related to appropriating
funds for the fiscal year 2014.
The recent shutdown took place as a result of a funding
gap. This was created by the two chambers of the Con-
gress, the House and the Senate, after they failed to agree
on two aspects. One aspect was the funding of Patient
Protection and Affordable Care Act, also called
Obamacare, and the other being Debt Ceiling. Currently
the House is dominated by the Republicans and the Sen-
ate by the Democrats. Obamacare needs funding from the
Federal Budget the next fiscal year. The House Republi-
cans insist on a new bill to defund Obamacare.
Obamacare aimed at making health insurance mandatory
for Americans. Republicans feel that it'll hurt employers
and add to overreach by the federal government. Republi-
cans critiqued that imposing medical device will lead to
sending jobs overseas. Democrats support the law saying
that it will increase the access to health care. Obamacare
prevents those with pre-existing medical conditions from
being denied health insurance, and advocates that those
who have health insurance will no longer pay indirectly to
those who show up in emergency rooms uninsured.
Another reason for shutdown was that of the Debt Ceiling.
VISHNU MANASA KANCHIRAJU & SAKSHI SINGHANIA(PGDM IB 2013-15)
US Federal Government
Shutdown of 2013
Republicans critiqued
that imposing medical
device will lead to
sending jobs overseas.
Democrats support
the law saying that it
will increase the ac-
cess to health care.
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Business Name
led to a lost productivity equivalent to $2.0 bn. It was esti-
mated that the shutdown would cost the economy about
$55 bn and as per Goldman Sachs the GDP growth of US
would be reduced by 0.9%. Key government functions
such as health services, training and support of traffic con-
trol services were affected and also national parks, monu-
ments, museums remained closed.
A temporary solution was found to the US shutdown on Oct
16, 2013. Congress passed an interim appropriations bill
with majority from both the Senate and the House. The
deal funded the US government until January 15, 2014
and raised the debt ceiling of the country until February 7,
2014, which finally ended the economic shutdown.
Debt ceiling is the limit fixed for the money that the gov-
ernment can borrow. It was first introduced in 1917 and
since 1960, the government has raised it 78 times. Cur-
rently it is set at $16.7 trillion and it was estimated that by
October 17 this limit would be exceeded. Had the debt
ceiling not risen by then, the US would have begun to de-
fault on its debt, for the first time. Once when it nearly hap-
pened in 2011, the US credit rating was downgraded. Re-
publicans indicated that they will demand concessions
from Democrats on spending so as to raise the debt ceil-
ing. President Obama opinionated that there will be no
negotiation on the issue as defaulting on the national debt
would make Americans deadbeats.
The shutdown had major consequences. One of the signifi-
cant effects of this shutdown was that approximately
800,000 government employees were furloughed, which
Singapore has the highest ratio
of millionaires in the world.
Did You Know
USAs biggest export to China for
the last 5 years has been trash.
Did You Know
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What if, one morning you woke up and real-
ized that your business is obsolete. What
would you do to reclaim your market and
become relevant in your business again? Can you leverage
this opportunity to take your business to new heights?
This scenario is the prelude for the articlestaying relevant
in the current economic scenario. In the current volatile
environment companies need to
be flexible to remain relevant. The
adage Either you change or you
die holds perfect in todays time
and age. One needs to constantly
monitor his businesss relevance
in the market and acclimatize quickly enough to maintain
it.
Let us look at some real life examples of such a nightmar-
ish scenario. We all remember Eastman Kodak, which
used to sit pretty at the top till a few years ago. Founded in
1892 it was a quintessential American company whose
brand was known worldwide due to its film photography.
Kodak had captured 90% market share in the USA and
enjoyed 70% margins.
Kodak was caught unaware as the realms of photography
moved from Analog to Digital. The company simply could
not match the pace with which the transition was taking
place. With the advent of digital photography people could
create, edit, store and share images instantly. As a result,
Kodaks core competence had started to become obso-
lete. In Jan 2012, the company filed bankruptcy. It re-
emerged from bankruptcy in Sep 2013, but only as a pale
shadow of its former self.
The lesson to be learnt from the Kodak saga is that unless
your business possesses ongoing relevance, you are not
going to survive however good you may be in your busi-
ness. If you focus only in the current market space you
might miss on the bigger picture.
Lets move on to the next example. In 1991, Nokia lost its
major market when the Soviet Union dissolved as an eco-
nomic entity but this proved to be a blessing in disguise for
the company. Earlier the company focused on manufactur-
ANIRBAN CHAKRABORTHY(PGDM IB 2013-15)
Adapt Or Die
One needs to con-
stantly monitor his
businesss relevance
in the market and ac-
cl imatize quicklyenough to maintain it .
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it had itself created. Nokia could not establish its strong
hold in the US market and it did not focus on the Smart-
phone arena, the telecom industrys fastest growing area.
By 2012, Samsung had captured the market big time and
production of Nokia fell below the breakeven point. Micro-
soft acquired Nokia in Sep 2013 for $7 bn a remarkably
low price considering Nokias market share of $77 bn five
years ago.
So the biggest hurdle is how do you ensure that your com-
pany is relevant? One thing which can be done is to ask
yourself the hypothetical questions of the nightmare sce-
nario: if your biggest market or your core business van-
ishes over night, can you think of ways to bring impetus to
the business? This mental exercise will keep you agile and
help you monitor the underlying relevance of your busi-
ness.
ing paper, rubber and wood-based products. Mobile
manufacturing was a miniscule portion of the companys
business. Nokia realized the potential in this miniscule
portion and decided to leverage on it for future growth. By
1994, Nokia sold its industrial units and got listed in NYSE
as a premier manufacturer of mobiles, hence creating a
completely new market space. Such was the dominance
of Nokia that the market share of Nokia was more than
the combined share of its top three competitors.
Nokia could not afford to be complacent having estab-
lished itself as the market leader in this new market
space. Over the recent years Nokia failed to keep pace
with the latest technological developments in the market
Business Name
After Coca-Cola was forced out of
India in 1977, the Indian
Government started its own brand
of cola known as Double Seven.
Did You Know
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Sitting on the floor of a semi-furnished flat in cen-
tral Yangon, men in the early twenties are tapping
vigorously on the old laptops and occasionally
gazing at the bits of paper pieces scattered around them.
These men would easily pass for college going guys fid-
dling with their Facebook. These
men are in the Research team
of NLD (National League for
Democracy). It is Myanmars
main opposition party and is led
by Ms. Aung San Suu Kyi. They
need to produce a weekly media
-monitoring report shortly which
will provide links to all the main references to the NLD and
Myanmar in the international press.
These people dont have any office so they meet at Mr.
Nay Chi Wins flat. Mr. Win is the founder of the Unit at the
age of 32. The only accessory the team working at his
place is a whiteboard. His main concern is whether he
would be able to afford the rent. However, the founding of
the Research Unit signifies that they are taking rapid
strides to transform the NLD.
NLD was founded in 1988 by Ms Suu Kyi and others to
stand against the dictatorial military rule in Myanmar but
all these years it has found it very difficult to function with
its full potential. The partys power had been on the wane
because most of its leaders were put behind bars and
tortured and the party was declared illegal. However, since
2011 under the reins of the President Thein Seins de-
mocratic reforms, the party has been on the verge of
power. It won 43 out of 44 seats in the by-elections con-
tested in 2012. If the same trend continues in 2015 gen-
eral elections, NLD could sweep the parliament and Miss
Suu Kyi can become the president.
There has been a complete reversal in the partys fortunes
but many people still feel that the party has not been able
to keep pace with the changes. The party was criticized
vehemently in its first National Congress Meet in March
due to its dominance by old leaders. Moreover, there were
accusations that Miss Suu Kyi is largely inaccessible and
HARDIK DHAGAI & ANIRBAN CHAKRABORTHY (PGDM IB 2013-15)
Winds of Change in
Myanmar
NLD was founded in 1988
by Ms Suu Kyi and oth-
ers to stand against the
dictatorial military rule
in Myanmar but all these
years it has found it
very difficult to function
with its full potential.
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Business Name
been sent to USA for English training and to learn democ-
racy.
There has been constant criticism from all quarters due to
Miss Suu Kyis continued isolation from the party and also
on her lack of willingness to deliver the required knowl-
edge on policy framing to others. Also, the leadership has
been trying to get the clauses in the constitution changed
so that Miss Suu Kyi can become President in 2015.
These arguments have irked her advisers. They have im-
plored the people to be more patient considering the short
time frame and slender budget at their disposal. While she
is being attacked for being isolated from the party, she is
frustrated that nobody is willing to raise his voice against
her. Fame has allowed her to control a world audience
and at the same time taken her away from her own peo-
ple.
the party members do not have any voice in policy making.
Some even go to the extent of complaining that the party
does not have a basic policy formation framework so it is
highly underprepared to form the government in two years
time. And so the young generation party members have
taken it upon themselves to carry the baton ahead.
The research unit was set up by Mr. Nay Chi Win to
institutionalize and decentralize the party because he
felt it was too dependent on Miss Suu Kyi. Training is pro-
vided to NLD members in local branches all around the
country. The cadres who make it Yangon are given training
on basic administrative functions and Public Relations.
They are also provided training in personal grooming by
Ms. Tin Moe Lwin who is a famous model. The MPs have
The campaign of Amul girl is the
oldest continuous running
campaign in the history of
advertising.
Did You Know
How massive is IKEA? It
consumes 1% of the worldswood!
Did You Know
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Despite being a developed nation, Greece has
been a troubling pot for quite a while now.
Though July reports show that the trade deficit
has slightly reduced, a lot more damage has already been
done. Global investor community has lost confidence in
Greece and the currency is in a
bad shape. Traditionally, Greece
has been an exporter of food,
beverages and textiles. Although
the Current Account Deficit re-
duced marginally during reces-
sion, it has always been a cause
of concern. Tourism recorded a
robust growth even during reces-
sion years and contributed 15% to GDP.
Unemployment and low productivity are the biggest prob-
lems for Greece. Machinery, transport equipment, fuels
and chemicals are major imports in Greece. Greece, a
capitalist economy, has 40% of public sector contributing
40% to its GDP. Athens Olympic Games in 2004 provided
some spotlight on the global platform to Greece, provided
better infrastructure, support from other countries but re-
cession in 2008 proved it be the worst performer. Austere
measures were introduced; imports were reduced, but it
hardly made any mark on the report card. Today, Greece
hangs in a delicate balance between economic sanctions
from Euro zone, remittances from expatriates, shipping
and tourism revenues and revival methods to reboot its
economy. The culprit in the entire scenario is the huge
borrowings made over the time.
According to a recent report, Greece government has
taken many measures to simplify and ease pre-customs
and customs norms to encourage exports. The key point-
ers in this proposal seek to reduce the number of days
needed to export by 50% and reduce cost by 20% by
2015. A single national clearance window for exports has
also been proposed. With intent to improving trade relation
across borders and attracting foreign investors, sound ex-
port policy is under creation. Government has shown keen
interest in resolving issues related to lack of information
and transparency; this will help to boost confidence in
MEENAKSHI VYAS (PGDM RM 2013-15)
Greece Needs a Reboot
Today, Greece hangs
in a delicate balance
between economic
sanctions from Euro
zone, remittances
from expatriates,
shipping and tourismrevenues and revival
methods to reboot its
economy.
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Business Name
beverages and textiles. I wouldnt call it a lost battle for
Greece, because as a nation Greece has a plethora of re-
sources, trustworthy trading partners and warming up re-
forms. If played patiently and wisely, Greece can regain its
lost aura and stance.
start-up firms. For example, providing information regard-
ing the number of items approved for imports and exports,
clearing unnecessary documents for set up procedures,
legal and fair procedures will be promoted. Greece relies
on tourism, services and exports for most of its GDP. Infra-
structure of the country is pretty well settled since Greece
remains one of the developed countries. Hence, Greece
has little to worry in this sector.
Outside EU, United States is Greeces largest trading part-
ner. Traditionally, Greece has been an exporter of food,
The Hard Rock Cafe is owned by the
Seminole Tribe of Florida. They
purchased Hard Rock Cafe
International Inc. and all relatedentities for almost $1 billion in March
2007.
DID YOU KNOW
SONYs most successful business is
selling Insurance, which contributes
about 63% of their total profit.
DID YOU KNOW
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V
ietnam, officially the Socialist Republic of Viet-
nam, is the easternmost country on the Indo-
china Peninsula in Southeast Asia with a popu-
lation of around 88.78 million (2012). Vietnam
has a long seacoast in the eastern side, is bordered by
China to the north, Laos to the northwest and Cambodia to
the southwest. Its capital city is Hanoi the second larg-
est city in Vietnam after Ho Chi Minh City (Old name: Sai-
gon a gem stone city of Indochina during USA domi-
nated). Other major cities of Vietnam are Da Nang (main
city of center Vietnam) and Hai Phong (the most important
northern seaport due to its large maritime facilities).
History
Vietnam has one of the longest histories in the world. Ac-
cording to researchers, Vietnams history has been divided
into seven periods from 500,000 BC. These being: Prehis-
tory, Bronze Age, Dynastic Vietnam, French Vietnam, First
Indochina War, Vietnam War and Reunification & Reforms.
During the Dynastic Vietnam period, Vietnam was domi-
nated by China for over 1000 years. The Chinese rule im-
mensely influenced the Vietnamese administration, law,
education, culture, literature and language. In 938 AD,
after a millennium of Chinese domination Vietnam re-
gained complete independence.
For centuries to come, China
continued its attempt to gain
dominance over Vietnam, but
the citizens of Vietnam never
stopped fighting to stay inde-
pendent.
In the 17thcentury, Vietnams independence was gradually
terminated by France. The French administration imposed
significant political and cultural changes on the Vietnam-
ese society. A Western-style system of modern education
was developed. The French created plantations and pro-
moted the export of tobacco, indigo, tea and coffee. How-
ever, their policy was strict for civil rights, the Vietnamese
suffered a lot in this period. A nationalist political move-
ment soon emerged, with leaders such as Phan Boi Chau,
Phan Chu Trinh, Phan Dinh Phung, Emperor Hm Nghi and
Ho Chi Minh fighting for independence. The French main-
tained control of their colonies until World War II, when the
war in the Pacific led to the Japanese invasion of French
Indochina in 1941. The Japanese Empire exploited Viet-nam's natural resources to support its military campaigns,
leading to the Vietnamese Famine of 1945, which caused
up to two million deaths.
The year 1925 also marked the founding of the Viet Nam
Thanh Nien Cach Menh Dong Chi Hoi (Revolutionary Youth
League) in Guangzhou by Ho Chi Minh. Ho Chi Minh is also
called the Father of Vietnam. He was influenced by the
Marxist-Leninist revolutionary doctrine. In 1941, the Viet
Minh, a communist and nationalist liberation movement,
sought independence for Vietnam from France and the
Pham Thi Huyen, PGDM-Marketing (2012-14)
Vietnam The Rising Jewel
The Chinese rule im-
mensely influenced the
Vietnamese administra-
tion, law, education,
culture, literature and
language.
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also reached the shores of the Red River Delta. A maritime
trade among China, India and Indonesia used the delta as
a convenient stopover. Among the array of goods and
ideas, thus brought to Vietnamwas Buddhism from India. While
the Vietnamese aristocracy
clung to Chinese Confucianism,
during most periods the com-
mon people embraced Bud-
dhism, adapting it to fit their
own indigenous religions and
world view. During the French
colonial period, the Vietnamese culture was influenced by
the Europeans in terms of religion (Catholicism) and hand-
writing language (Latin alphabet). Since independence,
the cultural life of Vietnam has been deeply influenced by
government controlled media and socialist programs.
Vietnams religion is a mix of Buddhism, Confucianism,
Catholicism and Taoism. Vietnams visual art is strongly
influenced by the Chinese Buddhist art. Vietnamese music
varies from three regions: North, Central and South. Water
puppetry is a distinct Vietnamese art which had its origins
in the 10th century and is very popular in the northern
region. Vietnamese cuisine is created by the traditionally
cultivated wet rice and extremely diverse follow regions.
One of the nations most famous dishes is the Pho. The
national costume of Vietnam is the Ao Dai. However, Ao
Dai is worn only in traditional festival, school uniform and
wedding. In daily life, Vietnamese clothes are Western
styles.
Political
The Socialist Republic of Vietnam follows a single-party
socialist republic framework, where the President of Viet-
nam is the head of the state and has executive power. The
Prime Minister of Vietnam is the head of the government,
in a one-party system led by the Communist Party of Viet-
nam. Legislative power is vested in the National Assembly
of Vietnam. The Judiciary is independent of the Executive.
The election for the President of the Socialist Republic is
end of the Japanese occupation. Following the military
defeat of Japan and the fall of its puppet Empire of Viet-
nam in August 1945, the Viet Minh occupied Hanoi and
proclaimed a provisional government, which asserted na-tional independence on 2nd September. The first govern-
ment of Vietnam was formed Ho Chi Minh's Democratic
Republic of Vietnam.
After independence in North Vietnam, United States rea-
soned to support South Vietnam against the communist
insurgency. The United States gradually increased their
contribution to the Vietnam military. US forces became
involved in ground combat operations in 1965, and at
their peak they numbered more than 500,000. After that
they indulged in nonstop bombing on North Vietnam, caus-
ing many deaths of both, American and Vietnamese peo-
ple involved in warfare. During this time, Vietnam received
lots of support from China and the Soviet Union. On 2 nd
July 1976, North and South Vietnam were merged to form
the Socialist Republic of Vietnam. The war left Vietnam
devastated, with the total death toll standing between
800,000 and 3.1 million, and many thousands crippled by
the use of chemical weapons such as Agent Orange.
ulture
Vietnam is known as the Cultivator of Wet Rice and the
nation of the Fertile Plains of the Red River Delta in north-
ern Vietnam. Vietnam is considered as part of the East
Asian Culture due to long term dominance by the Chinese.
During the Chinese millennium, other cultural influences
While the Vietnamese
aristocracy clung to
Chinese Confucianism,
during most periods the
common people em-
braced Buddhism,
adapting it to fit their
own indigenous religions
and world view.
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done in period of five years and is decided by the National
Assembly of Vietnam. The political environment of Vietnam
has been very stable after independence. At present, Mr.
Truong Tan Sang is the President and Mr. Nguyen Tan Dungis Prime Minister of the socialist Republic of Vietnam.
Economy
Vietnam is a developing country and is a well known emerg-
ing market with an attractive location and a stable political
environment. After 1991, the Vietnam economy experienced
rapid growth with average GDP growth rate at 7.3%. IT was
the target market of many global firms then. Vietnam has
become a leading agricultural exporter and has served as an
attractive destination for foreign
investors. Nowadays the econ-
omy of Vietnam relies largely on
Foreign Direct Investment to
attract capital from overseas to
support its continual economic
development. Over the past 20
years, FDI inflows into Vietnam
have increased tremendously in
terms of share of investment,
trading turnover and GDP per-
centage. As of December 2012, the country is home to
14,522 valid foreign investment projects with a total capital
of over US$210.5 billion.
In terms of demographic, Vietnam has 70% of its population
in working age (from 15 to 65 years). In 2012, GDP was
141.69 USD billion, growth rate at 5% and inflation rate was
9%. The economy has been unable to achieve its targets in
the recent years because it was affected by the slower lend-
ing as banks strain under the weight of bad debt incurred
largely by the state sector.
Economic sectors are Agriculture, Energy, Industry and
Manufacturing, Service and Tourism, and Banking & Fi-
nance. In 2012, the best performing sector was Agriculture.
During this year, Vietnam became the biggest coffee ex-
porter and also the top supplier of rice to the world. Petro-
leum is the main source of energy which contributes to
about 25% of the countrys energy consumption. Besides
that, mining and quarrying are also important industries that
contribute to GDP and provide employment to the workforce.
The growth rate of GDP for this industry is 9.34% per year.Vietnams banking system consists of a combination of state
-owned, joint-stock, joint-venture and foreign banks, but the
state-owned commercial banks predominate over most of
the state-owned enterprises. Vietnam has two stock ex-
changes the Ho Chi Minh Stock
Exchange (HOSE) and the Hanoi
Stock Exchange (HNX).
Vietnams currency is called Viet-nam Dong (VND).
International Relations
The Vietnamese governments policy is very liberal towards
other countries. As of July 2013, Vietnam has diplomatic
relations with 182 nations throughout the world. Vietnam
became a member of ASEAN in 1995 and the WTO in 2007.
Besides that, Vietnam is also a member of the World Bank,
IMF, The Asian Development Bank and APEC. A critical rela-
tionship of Vietnam is with ASEAN.
ASEAN Free Trade Area (AFTA) was established in January
1992. The AFTA effectively removed trade barriers such as
tariffs in order push for freer trade among member states.
This led to the creation of opportunities for companies with
an ASEAN presence to take advantage of the 10 different
economies in the region by way of the Common Effective
Preferential Tariff Scheme. Vietnams major ASEAN exports
Vietnams banking system
consists of a combination
of state-owned, joint-
stock, joint-venture and
foreign banks, but the
state-owned commercial
banks predominate over
most of the state-ownedenterprises.
Vietnams major ASEAN
exports are crude oil,
computers, rice, steel,
gas and petrol, phones
and components, coffee.
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are crude oil, computers, rice, steel, gas and petrol, phones
and components, coffee. If comparing with other countries
in the block, Vietnam is the potential location as center
among members in block.
India and Vietnam relations
The Republic of India and the Socialist Republic of Vietnam
enjoy strong bilateral relations in terms of economic and
cultural ties. Bilateral trade touched US$ 2.5 billion in 2008
and continues to grow rapidly. Vietnams exports to India in
2008 registered an increase of 47% over 2007 and reached
USD 389 million. More than thirty
Indian companies have set up
Representative Offices in Viet-
nam. A large majority of these
offices are located in Ho Chi Minh
City. India now ranks 11th among
the main 4export markets of Viet-
nam. In the first seven months of
2011, the two-way trade value
was over US$2 billion, 41 percent
more than the same period last year, with US$1.3 billion by
imports from India and US$739 million by Vietnamese ex-
ports.
Major commodities exported from India to Vietnam are ani-
mal feed, machinery & equipment, pharmaceuticals and
pharmaceutical materials, ordinary metals, material for plas-
tics, iron & steel, leather & textile materials, medicinal ingre-
dients, cotton and pesticides.
Indias imports from Vietnam are largely dominated by com-
modities such as coal, pepper, rubber and cinnamon. Com-
puter hardware parts, garments and textiles also figure
among prominent items imported from Vietnam.
Both India and Vietnam have been working to strengthen
their cultural ties as well. The Indian Council for Cultural Re-
lations (ICCR) annually organizes the Cultural Exchange Pro-
gram, signed between the Government of India and the Gov-
ernment of Vietnam for studying, training and research in
various fields. 6 (six) scholarships are also awarded under
GCSS scheme annually to Vietnamese students for the un-
dergraduate, postgraduate degrees and for pursuing re-
search at Indian universities.
New Road
The new trend of many international manufacturing enter-
prises has been to look for relocation or expansion of their
China operation to capture alternative markets and thus,
hedge their risk of operations in China. Vietnam is a huge
market for consumption, is also easy to connect with ASEAN
countries in terms of location and tax deduction. Besides
that, the Vietnamese government offers many attractive
advantages for foreign businesses, including a number of
preferential policies and tax incentives, free trade status
within the thriving ASEAN region and a variety of economic
zones and industrial parks with an abundance of low priced
labor. Vietnam will become the most attractive place forcompanies that are looking for emerging markets.
More than thirty Indiancompanies have set up
Representative Offices
in Vietnam. A large
majority of these offices
are located in Ho Chi
Minh City. India now
ranks 11th among the
main export markets of
Vietnam.
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He is the 9th most powerful personality
in the world according to Forbes Power-
ful People list of 2013, is the most
popular name in the news since the European crisis
and he is, none other than, Mario Draghi. Draghi is
the 66 year old President of the European Central
Bank. He succeeded Jean-Calude Trichet as the third
President of the European
Central Bank on 1stNovember,
2011, after being appointed
by the leaders of 17 eurozone
countries.
He was born in Rome on 3rd
September 1947, and com-
pleted his graduation from La
Sapienza University under the
supervision of Federico Caff-
a notable economist. In the year 1996, he earned a
PhD in economics from the renowned Massachusetts
Institute of Technology, United States of America in
Economics with his thesis Essays on Economic
Growth under the supervision of two other well
known and Nobel Prize winner economists Franco
Modigliani and Robert Solow.
Mario Draghi brings a rich experience with him. He
was previously appointed the Head of the Bank of
Italy- the central bank of Italy. From 1984 to 1990,
Mario was the Italian Executive Director at the World
Bank. During the tenure of 1991-2001, he was the
Director General, Italian Treasury. He was also the
Vice Chairman of Goldman Sachs International from
2002-2005. From 2006-2011, he headed the Finan-
cial Stability Board (FSB), an international organiza-
tion that seeks to head off the risk from the global
financial systems.
Mario has earned the nickname Super Mario for
having navigated through the minefield of Italian poli-
tics ingeniously.
The European Central Bank is the eurozones central
bank which is responsible for the currency Euroand
administrating the policies of 17 European Union
states which makes use of the Euro. The main objec-
tive of the ECB is to maintain the eurozones price
stability.
In late 2009, the Eurozone was entering one of the
worst sovereign debt crises and the former President
Jean-Claude Trichet had resisted strongly within the
European Central Bank to providing any contempla-
KINNAR GALANI (PGDM-IB 2013-15)
Personality in Focus-
Mario Draghi
Draghi is the 66 yearold President of the
European Centra l
Bank .He was also the
Vice Chairman of Gold-
man Sachs International
from 2002-2005.From
2006-2011, he headedthe Financial Stability
Board (FSB), an interna-
tional organization that
seeks to head off therisk from the global
financial systems.
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ing cost low. It also helped the government to finance
themselves in the time of crisis. On 7th November
2013, Mario dropped the interest rates to a record
low to prevent rapid disinflation in the eurozone.
However many economists argue that the OMT pro-
gram may have pacified the financial market but it
will not help in meaningful recovery. The OMT pro-
gram has the potential to backfire and it may have
already backfired even though it is not used.
Mr. Draghi is credited for his efforts which have pre-
vented the eurozone from collapsing and tearing off
from each other. However the uncertainty and latent
challenges in the measures implemented by ECB to
solve the problem of euro crisis will surely put his fire
-fighting skills to real test.
tion to Greece which had defaulted on its debt. Jean-
Claude Trichet had faced a serious criticism for the
European Central Banks response towards the great
recession.
After the end of his term in October 2011, Mario had
the herculean task of maintaining the financial unity
and stability across the seventeen European states.
In 2011, Mario took his first move by inundating the
bank with cheap liquidity using a program called the
Long Term Refinancing Operation (LTRO) which
helped in stabilizing the banks and prevented the
seizing up of the inter-bank lending market.
On 26thJuly 2012, Mario Draghi said at an investors
conference in London, Within our mandate, the ECB
is ready to do whatever it takes to preserve the
euro, he added And believe me it will be enough.
In September 2012, he revealed his nuclear move of
ECB would see buying unlimited quantities of short-
term sovereign bonds which would keep the borrow-
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Ever thought of a currency which defies all theories
about money till date, which is neither regulated by
any country or central bank but by a cryptography
algorithm, a currency which even doesnt require your
personal identity to transfer funds across borders
and is acceptable irrespective of the country you are
using it in. Welcome to the world of digital currency:
it oin.
Bitcoin is an open source peer-to-peer electronic
money and payment network introduced in 2008
by pseudonymous developer "Satoshi Nakamoto".
Though nobody could ever trace him, the idea has
$1.5 billion under circulation.
How does it work?
The system is based on
cryptographic code which
acts as money and cantbe replicated on the net-
work. As soon as you in-
stall the Bitcoin app on
your computer or mobile a
wallet is generated. This
wallet has public address and private keys. Anyone
can send Bitcoins to a wallet using the public address
provided by the owner of the wallet, while the private
key must be entered by the wallet owner to send Bit-
coins. New Bitcoins are created by an algorithm and
computing power is taken from all computers on the
Bitcoin network. The entire network is then used to
monitor and verify both the creation of new Bitcoins
through mining and the transfer of Bitcoins between
users. Each new transaction is broadcast across the
Bitcoin network and a log is maintained called block
chain which is validated every 10 minutes. The sys-
tem thus makes it computationally nearly impossible
to make any illicit transaction like using same codeagain or reversing the transaction after the seller has
dispatched the item. That is because having such
forged transactions validated and attached to the
globally accepted block chain would require outpac-
ing the network's combined computing power.
Confused..? J Well dont worry; understanding the
technology behind is not our prime objective. Lets
focus on what its bringing to trade.
MANU MANASWI & KUSHAL SUNEJA (PGDM IB 2013-15)
BITCOIN:
Breaking Monetary Barriers
Bitcoin is an open sourcepeer-to-peer electronic
money and payment net-
work introduced in 2008by pseudonymous developer
"Satoshi Nakamoto". The
system is based on crypto-
graphic code which acts asmoney and cant be repli-
cated on the network
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We at IBS@SIMSR believe in evolving with
the world and continuing to grow. This
change in our logo, as a visible part of our
steps towards rebranding, is
intended to align ourselves
with the idea of a more dy-
namic and focused 'us'.
The new logo has come by
way of our attempts to lu-
cidly visualize our ideology
as a team driven to engage
in constantly building stu-
dents' domain knowledge in
the realm of international
affairs while functioning as a
connect between the stu-
dents and industry experts, our guests and our alumni.
Dear readers, this is what the transformed 'us' stand for
vis--vis the renewed logo.The new logo is a picture of the
globe surrounded by forward rolling spokes. The globe indi-
cates our vision of transcending borders to understand the
forces that drive the world. These multi-dimensional driving
forces are represented by the surrounding, forward moving
spokes. This forward move-
ment symbolizes our consis-
tent effort to enhance global
sensitivity.
This logo is an interpretation
of the very same objective
which is at the heart of our
committee, which is to act as
an instrument for students
to gain knowledge of the
global business environment
and connect them to busi-
nesses worldwide. It is with
great pleasure that we share this with you!
SAYONI MAITRA (PGDM-IB 2013-15) & DIVYA MIDHA (PGDM 2013-15)
IBS@SIMSR Launches
its New Logo
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19thOctober, 2013 witnessed another successful
annual International Business conference
PANGEA 2 13at SIMSR. Taking forward the pur-
pose of IBS@SIMSR to bring education and industry to-
gether to enrich the students through interaction with sen-
ior and competent company executives, this flagship event
brings various industry experts together on one platform to
address and interact with the SIMSR students.
The event began as scheduled at 10:30 am in the Red
Auditorium of the Institute with lamp lighting ceremony by
our honourable Director Dr. Satish Ailawadi and our es-
teemed guests. Introductory addresses were delivered by
Director Sir and Prof. C. P. Joshi, the Area Chairperson,
General Management and Program Coordinator for PGDM
and PGDM-International Business. The event was graced
by our most eminent speakers: Mr. Sunil Bahl (Vice Presi-
dent) - Sara Hong Kong Ltd, Mr. Rohit Pandya (General
Manager) - ECGC, Mr. Rishikesh Joshi (Head, Corporate
Services) - L&T Infotech and Mr. Somashekhar (VP, Treas-
ury and Forex Management) - AXIS Bank. They spoke on
various interesting topics like Third Country Trading, Coun-
try Risk Mitigation, challenges in entering new markets
and the latest developments in Treasury and Forex man-
agement worldwide. Students interacted with the industry
panellists and discussed various other topics in a brief Q
and A session. Finally the conference closed with the vote
of thanks given by our Faculty Mentor-IBS@SIMSR Prof C.
P. Joshi.
IBS@SIMSR Hosts
Pangea 2013
Meenakshi Vyas (PGDM-RM 2013-15)
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One ought to focus on we and us and
not on I and me to be a person of
worth in todays world.
Vasudhaiv Kutumbakam
This has been the crux of wisdom from all our Vedas
and scriptures and moral stories, probably since
time immemorial, and no one could have explained
it better than our esteemed guest Mr. Prafulla
Gupta.
Friends! We are talking about the recently and suc-
cessfully concluded 4 th Anniversary of IBS@SIMSR.
With
guidance of our mentor Professor C P Joshi, hard
work of the team and pleasing presence of a lovely
and lively audience, we were able to pull together a
great event on our teams 4 th anniversary on 18 th
Nov, 2013.
IBS@SIMSR thanks you all for gracing the occasion
and making it a success.
The celebrations commenced with SIMSR prayer,
followed by a welcome address by Prof. C P Joshi.
He cast light on the motto of IBS@SIMSR i.e. to com-
plement classroom learning through interaction with
international experts. Sir also talked about various
events conducted by IBS@SIMSR over the last four
years and about our very own quarterly e-publication
e -
GloBuzZ.
We also had the privilege of having with us another
esteemed guest Prof. Dr. Porus Olpadwala.
DIVYA MIDHA (PGDM 2013-15)
IBS@SIMSR Celebrates its 4th
Anniversary on 18th Nov 2013
(From Left to Right) Dr Porus Olpadwala, Ms. Kanchi Daiya, Prof C.P.Joshi, Shri Sameer Somaiya and Mr Prafulla Gupta
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Mr. Prafulla Gupta, who has over 40 years of inter-
national experience and has worked in more than
40 countries in diverse sectors like Management
Consulting, FMCG, Banking, Petrochemicals & Phar-
maceuticals, enlightened us with the lessons of life.
He was Senior Partner at Booz, Allen & Hamilton,
USA.
He emphasized on judgment skills, power of expres-
sion, ability to build institutions, leadership capabil-
ity, strength of character and ability to take deci-
sions to be the keys to success for aspiring manag-
ers today.
Prof. Dr. Olpadwala, who is on the Academic Board
of Somaiya Vidyavihar and is Dean Emeritus of Col-
lege of Architecture, Art & Planning, Professor
Emeritus Department of City & Regional Planning-
Cornell University, Ithaca, New York answered que-
ries of students related to higher studies abroad.
Ms. Kanchi Daiya, Manager, New Initiatives at
Somaiya Vidyavihar also graced the occasion.
This very interactive session ended with a vote of
thanks by Prof. C P Joshi.
As our Director Prof. Dr. S C Ailawadi said in his in-
augural address at PANGEA 2013 on 19 Oct, 2013,
IBS@SIMSR has achieved many milestones and
many are yet to be achieved.
We are confident of achieving new challenging mile-
stones with your continued support.
Did You Know
While the global agency, the United
Nations has 193 members, the
behemoth global beverage giant Coca
Cola is sold in 205 nations. Now Cuba
and North Korea are the only two
countries where Coke is not sold.
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