Zinnov Management Consulting presents a report on the Impact of the Modi Government within the first 100 days of taking charge

1. Zinnov | 1
August 2014
This report is solely for the use of Zinnov client and Zinnov personnel. No part of it may be
circulated, quoted, or reproduced for distribution outside the client organization without prior
written approval from Zinnov
“Modi”fied India:
Putting India Back in Business

2. Zinnov | 2
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Innovation

3. Zinnov | 3
India has traditionally been a vibrant economy with
strong economic fundamentals to support growth
Expected increase in India’s
share of global middle class
consumption by 2020
Largest Consumer Market13th
~3X
Consumption as % of GDP60%
Share of services in GDP57%
Growth of Services Sector12%
Largest Labor Force2nd
Investment as % of GDP35%
$ 1 Tn
Infrastructure investment
during the 12th Five-Year Plan
Consumption Driven Economy
Services Led Economy
Big Investments in Infrastructure
Rank in FDI Confidence
Index Survey2nd
India’s Trade to GDP ratio
growth in last decade2x
Government’s perennial focus on improving
the infrastructure has driven growth of
Indian Economy
High level of consumer spending ensures
continued demand from the domestic
market
India’s open-economy policy, initiated in
1991, has transformed India to a
flourishing economy
A large workforce and Services led
economy have augured well for India’s
growth
Source: World Bank Data | AT Kearney FDI Survey 2012
Open Indian Economy

4. Zinnov | 4
Over the past half decade, Indian economy has however
struggled to sustain the growth
9.3% 6.7% 8.6% 9.3% 6.2% 4.9%
8.4%
10.9%
12.0%
8.9% 9.0%
9.9%
FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013
Real GDP Growth Customer Price Inflation Index1
Real GDP Growth and Consumer Price Inflation (YoY Change)
-2%
-13%
-8%
2011 2012 2013
Foreign Direct Investment (USD Billion)
INR Depreciation vs. USD
1Continuous rise in food prices and supply chain bottlenecks has led to Inflation
2008
2009
2010
2011
2012
43.4
35.6
27.4
36.5
24
Source: World Bank Data
Global economic conditions and internal issues such as policy
indecision, corruption and subsidies have hampered the “India
Growth” story…
Loss of confidence among the foreign investors
and MNCs resulted in decrease in FDIs and
foreign exchange rates

5. Zinnov | 5
The primary reason behind the economic struggle has
been a weak government in the past 5 years
Governance
Related Factors
Global Economic downturn affected India’s exports and services
business
Global Slowdown
No strong figurehead emerged from the coalition governmentLeadership Crisis
Slowdown of economic reforms made India an unsuitable
destination to run business
Policy Paralysis
Improper action plan and poor allocation of funds resulted in
delayed projects that led to overruns of 15 BN
Implementation
Bottlenecks
Government accused of multiple scams such as $5bn Telecom
Spectrum scam, $29bn Coal mine scam, etc.
Corruption
Source: Primary Interviews, Zinnov Analysis

6. Zinnov | 6
Disappointment with previous government led to an
unprecedented mandate for a stable government
180
Million
Highest
votes to a
single party
ever
1st
Time
Since 1984 -
Single party
majority
9.1
Seats to
vote share
Since 1984
Highest
seats won
by a party
SINGLE PARTY COALITION
Non – coalition (single party) government at the center will allow for swifter policy making
and reduce stakeholder confrontation leading to a stable government
Electorate’s mandate for a Stable
Government
Empowered Government
Source: Election Commission of India website, Zinnov Analysis

7. Zinnov | 7
Modi’s governance model has a proven track record of
being decisive, reform-oriented and business-friendly
Source: RBI data, Ministry of Commerce and Industry
1/5th of India’s total FDIs in
the past 3 years
Unemployment Rate
against India ‘s 3.8 %
Among all states in
Economic Freedom Index*
Manufacturing Jobs
created in India
$17.5
billion
1%
26%
1st
Among states in number
of SEZs4th
Smart Grid in India
1st
Infrastructure Build Up
• Urban Development
• Gujarat WAN
• Roads
• Ports
Industry & Investments
• Industrial Clusters/Estates
• Pro – Industry Policies
• Skill Development
• Investment Summits
• Technology Investment
• Finance
• Alternative Sources
• Governance
Power Sector Reforms Healthcare
• Childcare
• Maternity Services
• Universal Coverage
• Health Care Centers
The unprecedented mandate and the positive track record has instilled hope of an economic
turnaround among the citizens and the investors

8. Zinnov | 8
Modi government has identified “5 Growth Levers” to
accelerate India’s economic growth…
Digital India
“IT( Information Technology) + IT ( Indian Talent) = IT (India of Tomorrow)”
India as the Innovation Hub
“I am confident that India will become the world’s innovation hub in ICT”
Next Gen Infrastructure
“Focus in infrastructure needs to shift from highways to "iways" and optical fibre networks”
Enhance Ease of Doing Business
“Maximum governance and Minimum government”
Revive Manufacturing
“We should become a Global Manufacturing Hub”
5
India’s
Growth Levers
As identified by
Modi
Source: BJP Manifesto, Narendra Modi Interviews
1
2
3
4
5

9. Zinnov | 9
The “Growth Levers” present a massive potential
opportunity for the Technology MNCs
Source: Primary Interviews, Zinnov research and analysis; All figures are in USD and estimates for the year 2014-15
Total Opportunity Size for
Technology Companies
Digitization $7B
Infrastructural
Improvements
$11B
Push for
Manufacturing
$7.3
B
Technology in
Healthcare &
Agriculture
$0.7B
Year
2014-15
Government Investments in
technology (Year 2014-15)
Opportunity by Technology Areas
$26
Billion
Communication
Technology
$4 BN
Computing &
Storage
$2.6 BN
Software
$4.2 BN
Engineering &
Machinery
$6.6 BN
IT Services
$5.9 BN
IoT
$2.7 BN

10. Zinnov | 10
Digitization across government functions offers a multi
billion dollar opportunity for technology MNCs
Source: BJP Manifesto and UIDAI portal
Digital India
Digitization of Agriculture and PDS
data
Enabling e-Governance &
m-Governance
National Rural Internet & Technology
Mission (Telemedicine & m-Healthcare
Use of IT for agriculture for real time
information
Digitization of all government files
Increasing the penetration and usage
of broadband across the country
$7
Billion
Telecom
IT Services
High Performance
Computing
Medical
Devices
Software
Development
SMAC
2014-15
Government’s Action Plan Government’s Action Plan
USD 6.1 Billion
Investment
In the past, multiple MNCs have been engaged by the Government for implementation of digitization projects
Opportunity for Technology MNCs1

11. Zinnov | 11
Government has defined a 3-pronged strategy for an
Innovation-fuelled India…
Source: BJP manifesto & Zinnov Talent Study
India as the Innovation Hub
1) Skill Enablement
 Increasing IITs and IIMs
 Institute of Big Data Research
 Revising curriculum as per industry
needs for higher studies
2) Innovation accelerators
 Ministry of Entrepreneurship
 Establish an Intellectual Property
Rights Regime
 Tax incentives for investments in
R&D
3) Innovation infrastructure
 Autonomous technology transfer
organizations
 Facilitating multi country and inter-
disciplinary research
 Est. world class research centers”
Government Accentuators
of Innovation
• 3500+ Startups
• 400 VCs & 2500
Angel Investors
• USD 1.6 billion
invested in 2013
Startups
• 3500+ MNCs
• 850+ R&D GICS
• 85+ India Service
Providers
MNCs
• 400+ Universities
• 770K Engg Grads
• USD 1.5 billion
invested in 2013
Universities
• 300+ National
Laboratories
• 300 R&Ds in
public sector
Government
Matured Ecosystem
Innovation-
Fuelled India
2

12. Zinnov | 12
…which will provide a robust R&D ecosystem & diverse
growth opportunities to MNCs
Source: Primary Interviews; Ingersoll Rand website
India as the Innovation Hub MNCs will be able to harness diverse
benefits of an innovative India
MNCs have been leveraging the Indian innovation ecosystem to develop products for the Indian customers
Access to high quality
talent
Innovative ecosystem will produce
high quality research outputs and
researchers
Innovate for India from
India
Proximity to customers will
accelerate and improve India
centric product development
India Innovates
Emergence of Industry
consortiums for joint R&D
Innovative ecosystem will allow
joint R&D efforts across industries
for accentuated product
development
Cooperation with
Academia for Research
Industry, Academia and
Government collaboration for high
end researchReverse Globalization
Successful Indian products can be
taken to similar markets globally
Access to a rich start up
ecosystem
Possibility of acquisition of
disruptive innovations from start-
ups
Ingersoll Rand’s India R&D center (IRETC) developed a new
refrigerated transportation solution to address the problem of
large scale wastage of perishable farm produce
$316
Million
Cold Storage
Transportation
Market
2

13. Zinnov | 13
3Next Gen Infrastructure
Government has identified key focus areas to drive next
wave of infrastructural growth backed by technology
Source: Primary Interviews ,BJP Manifesto, Zinnov Research & Analysis
National
Optical-Fibre
Network
Diamond
Quadrilatera
l project
100 smart
cities
National
solar mission
National Gas
Grids
High-speed
digital
highways
Restarting
stalled Infra
projects
Government Investment
in Technology
$ 11Bn
investment
Technology MNCs have, so far, played a crucial role in the establishment of next gen infrastructure
1.5
MN
Digital Meters
Installed
1st
Micro Grid
Implementation
$90
BN
Total Government
investment in DMIC

14. Zinnov | 14
4Enhance Ease of Doing Business
Government has planned for simpler and well defined
Tax policies to aid businesses
Source: World Bank – Doing Business report series, BJP manifesto
Expected introduction of Goods & Services Tax (GST) and Direct Tax Code (DTC)
 BJP has committed to bring on board all states for implementing the GST
 GST would simplify & often lower taxes, broaden collection and spark spending
 DTC reforms will remove complexities and bring stability to the economy by increasing
investments, creating jobs and boosting exports
Easier tax policies for MNCs
 Review of the retrospective tax laws introduced in 2012-13
 Higher incentivisation of R&D investments, geared towards indigenization of technology and
innovation
Expected increase in foreign direct investment limits
 FDI will be allowed in sectors wherever needed for job and asset creation, infrastructure and
acquisition of niche technology and specialized expertise
 Increase of FDI limit in multiple sectors including railways, construction; with 49% limit in
Defense
#134
189
Ease of Doing
Business
World Bank’s Ease of Doing
Business Survey
#179
189
Ease of Starting
a Business
The new government will embark on rationalization and simplification of
the tax regime to make it non-adversarial and conducive to investment,
enterprise and growth

15. Zinnov | 15
India is already home to the most prestigious
manufacturing companies globally
Source: World Bank – Doing Business report series, BJP manifesto
5Revive Manufacturing
World’s 3rd largest
Motorcycle
manufacturer
One of the largest Aluminium
Rolling companies
Biggest producer of Primary
Aluminium in Asia
World’s largest
producer of polyester
yarn and fibre
World’s 5th largest
Wind Turbine
manufacturer
World’s largest Motorcycle
manufacturer
Largest Oracle Siebel CRM
Implementation in India
World’s 2nd largest
producer of Viscose
Rayon Fibre

16. Zinnov | 16
5Revive Manufacturing
With Modi’s impetus on “Zero Defect” manufacturing,
India will soon be the global hub for MFG (1/2)
Source: World Bank data, BJP manifesto
152 191 185 203 246 249
892
1141
1460 1477
1813
2342
2007 2008 2009 2010 2011 2012
Manufacturing, Value Added
(USD billion)
India China
2014 2020
14% 20%
Execution Plan
FDI in Defence
Sector
Labor Intensive
Industries
Investment along the
Dedicated Freight &
Industrial Corridors
NIMZs* outside
DMIC Region
Clear Tax Policy
Manufacturing, Value
Added ( as % of GDP)
*NIMZ : National Investment and Manufacturing Zones |
DMIC : Delhi-Mumbai Industrial Corridor
Modi aims at cranking up the share of manufacturing
in India’s Gross Domestic Product

17. Zinnov | 17
Opportunity in Machinery
and Engineering
5Revive Manufacturing
With Modi’s impetus on “Zero Defect” manufacturing,
India will soon be the global hub for MFG (2/2)
Source: Zinnov Research and Analysis
Government’s push for
manufacturing
Increasing adoption of IT in
manufacturing in India
Increasing IoT relevance in
manufacturing
MNCs setting manufacturing base in
India
Growth of India based manufacturing
companies
Wider deployment of SCADA,MES,ERP
systems across small scale factories
Growing use cases of IoT in factories
Deploying cloud-based services with
intelligent analytics
2.5 BN 2.7 BN
1.4 BN
2013 2014 2017
Indian Manufacturing Industry
present a $ 8 BN opportunity for the
ICT sector by 2017
Added
opportunity
because of
government
reforms
USD 3
BN

18. Zinnov | 18
The “5 Growth Levers” will be executed by a focus on
3S – “Skill, Scale and Speed”…
Source: Zinnov Research and Analysis
Skill
• 70% population is below 35,
indicating a vast talent pool
that needs to be empowered
• E-education for widespread
skill development
• Setting up vocational training
centers in field of IT and
manufacturing
Scale Speed
Propelled by Technology
• E & M Governance will enable
better outreach for the
government policies
• Technology to connect with
citizens
• Nation-wide Internet
connectivity to enhance
business outputs in every city
• Need to eliminate tardiness in
decision making & policy
implementation
• Need to use technology for
real time information &
analytics across industries
such as PDS, agriculture &
transport
Smart Grids, E – Governance,
Telemedicine
IoT
Cyber Security, Health
Informatics, HGCHPC
PDS, Agro-analyticsAnalytics
UID, E- Files, GI-CloudCloud

19. Zinnov | 19
… and enabled by India’s robust fundamentals
Source: Zinnov Talent Study, National Portal of India
1 2 3 4
Talent
Availability
Strong
Democratic
Fiber
“Entrepreneurial
Indian” Mindset
Communication
Infrastructure
Talent
Availability
• 85,000: Graduates from Top tier
Engineering institutes
• 1.2 Million: Total engineers
graduated in 2014
• 80 Million: Vocationally Trained
labors
India’s 4 Growth Pillars
Strong
Democratic Fiber
• Strong parliamentary democracy
• Well defined electoral processes
• Diversified representation in Lok
Sabha – 16% - SC, 9% - ST
• 33% Women representation in
various government levels
Communication
Infrastructure
• >200 Mn internet users; 3rd Largest
in the world
• 2nd largest number of telecom users
(18.94 Mn users added each month)
• 73.32% India’s teledensity
• 13 Mn broadband subscribers
“Entrepreneurial
Indian” mindset
• 40+ first generation billionaire
• 4000+ active technology startups
• 150 Start up incubators
• 49 Million SMEs/ SMBs operating in
India

20. Zinnov | 20
The first 100 days of the government has already
demonstrated positive impact
Let us script a glorious future…
IT+IT=IT; Indian talent +
Information technology = India
Tomorrow
Don't compromise in
manufacturing; Stress on
Zero defect, Zero effect
A son of a poor man is standing in front of you
today. This is the strength of a democracy.
Source: Hindustan Times, TOI, ET, DNA, Mint, YourStory; 1NCAER: National Council for Applied Economic Research, 2under Jan Dhan Yojana
 5.7% GDP Growth Apr-Jun -
highest in nine quarters
 Aim to lower fiscal deficit to
4.1% of GDP by Mar 2015
 13% Rise in NCAER’s1 quarterly
Business Confidence Index in
June 2014
 INR 7,060 crores allocated to
build Smart Cities
 1.5 crore bank accounts
opened in 1 day2
 49% FDI limit in Defense and
Insurance
 14 # of IITs, IIMs and AIIMs to
be setup
Modi’s 100-Day Impact

21. Zinnov | 21
• Planning Commission to pave the way for a
Think-Tank
• GoMs/EGoMs1 scrapped for National Data
Litigation Grid for quicker disposal of legal cases
• MyGov Portal for citizens to directly interface
with the government
• SIT2 formed to locate estimated INR 50,000
crore in black money stashed in tax havens
abroad
1Groups of Ministers (GOMs) and Empowered Groups of Ministers (EGOMs), 2Soecal Investigative Team,
• Jan Dhan Yojana - financial inclusion with 1.5 crore
bank accounts opened on the 1st day
• 1st phase target of 7.5 crore accounts by Jan 2015
• National Food Grid to connect deficient areas with
surplus producing regions, reduce wastage and
contain food inflation
• Broadband in 2.5 lakh villages by 2019
• Wi-fi in 2.5 lakh schools, all universities
• 4 lakh public Internet access points
• Trainings in small towns/villages for jobs in IT sector
• Spend of INR 1 lakh crore on current schemes
• INR 13,000 crores for new schemes
• Relationship building with Asian nations such as Bhutan,
Nepal and China
• Modi’s recent visit to Japan led to Japan investing $35
billion in India
• Modi setting up Special Management Team under PMO
to facilitate business from Japan
The stage is all set to create long term sustainable
growth and reposition India on the global map
'Minimum Government, Maximum Governance‘ Empowering the Poor
Digital India “Looking East”

22. Zinnov | 22
India’s successful Mars Orbiter Mission has showcased
India’s expertise and efficiency in Space Research
India’s first Interplanetary
Mission
4th in the world to succeed
INR 450 Crores
1/10th of the cost of a similar US
mission
1/4th of the tiome taken by
NASA for a similar mission
As small as TATA NANO car
1350 kgs- equal to the
weight of a mid sized car
`
MANGALYAAN
Low cost due to involvement of
Indian companies like
Centnum Electronics
Godrej & Boyce
Hindustan Aeronautics
Vajra Rubber
Avarsarala Technologies
Walchandnagar
2/3rd of MANGALYAAN’s parts were
manufactured in India
Technology Transfer
ISRO offers the know-how of their
technology to entrepreneurs in India
Also provides technical consulting
services to industries & R&D
institutions in diverse areas of expertise
Enhanced Visiblity
Enhanced global visibility for smaller
organizations involved with the
programme
Potential for export orders in areas of
defence, aeronautics etc.
Impact on the Local Ecosystem

23. Zinnov | 23
Modi has focused on re-energizing bilateral relations
through an emphasis on forging investment partnerships
Japanese government’s promise of investing $35
billion (3.5 trillion yen) into infrastructure projects
in India
Areas of partnership include rejuvenation of
Ganga, smart cities, transport systems, skill
development and next generation infrastructure
Target to double Japan’s FDI and the number of
Japanese companies in India within five years
Beijing committed investment of about $20
billion in India over the next five years
Setting up of two Chinese industrial parks in
Maharashtra and Gujarat
China will play a role in development of high
speed railways in India and the first project
will focus on upgrading some of the existing
railway lines and stations in India
JapanChina
USA
Five-year Trade and Economic Development Plan’
that seeks to reduce the bilateral trade imbalance
and strengthen investment cooperation
USIBC (US-India Business Council) has identified investments
worth $ 41 billion by its members into India in the next 3 years

24. Zinnov | 24
Swachh Bharat or Clean India Mission
Driving a non-political movement driven by patriotism to
make India clean by October 2, 2019
Interactive website that seeks to foster participatory
governance and also aims to keep citizens who volunteered
to support government programs engaged.
MyGov Portal for citizen’s participation in governance
Make in India Campaign
Campaign to put India prominently on the global
manufacturing map and, in turn, facilitate the inflow of new
technology and capital
UIDAI based Biometric Attendance System across
government office to provide a real time
transparent track of government employees attendance
Biometric Attendance System
Modi Government has already started diverse initiatives
to improve governance and develop India as the place to
be

25. Zinnov | 25
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