“Nepali banking will require some time to develop the depth and maturity”
 |
Neeraj Swaroop, CEO of Standard Chartered Bank in India was in Nepal recently.
Excerpts from an interview:
|
What’s the present performance level of the Indian banking industry?
As you might know, in the mid-90s, the RBI allowed private sector banks to set up, which brought in an assortment of innovative banking systems and practices. Banks like ICICI, HDFC, UTI and Global Trust geared up to break the monopoly of foreign banks that had long been dominating the Indian banking industry. These private-sector ventures came laden with the latest technologies and good market link-ups, which brought about an intense competition in the market. The public-sector banks also improved their efficiencies following the market growth and ensuing competition. Moreover, in late-90s, the interest rates, which used to be too high, started to decline. This enabled Indian banks to book profits on securities and government bonds that they were holding. It also enabled them to clean up their balance sheets and bring down their Non-performing Assets (NPAs) from 7-8 percent to 3 percent, which was considered healthy in terms of international banking standards.
So if you look at the Indian banking system now, all three categories – the public-sector, the private-sector and the foreign banks have their balance sheets strong. There is no major risk in the banking system from NPA point of view. Also, with the economic boom of the recent years, the retail lending has gone up and banks have diversified their services accordingly. The regulators have also done a good job by opening up free market, remittance option and forex market to the banks. So there is a lot of optimism about the Indian banking industry.
How is StanChart India doing?
It is the largest foreign bank in India. We merged with Grindlays Bank in 2000/01. Till that time, both foreign banks were big but not the biggest in India. Now we are the largest international bank in India with 83 branches in 33 cities across the country. We have almost 20 thousand employees. So it’s a large operation and we have been making a fair amount of revenue and profit in India.
How is the business in buying and selling of securitized assets that StanChart India entered a few years ago and doing it now through its subsidiary?
We are still not doing it through a subsidiary. We entered this market about two years ago and picked up securitized assets from ICICI and State Bank of India. We picked it up on the banks’ balance sheet though it was not permitted. Soon after RBI allowed it on the condition that we held it for 15 months.
In the recent times, many commercial banks have cropped up in Nepal. How do you look at the possible impact of Basel II and III standards on them? What’s the present status of the Indian banks?
I think that the Government and the Central Bank in Nepal would take adequate steps for effective implementation of Basel II for all the banks operating in the Nepali market. I expect that the banking system in Nepal will cope with this requirement well. RBI has asked the banks operating in India to adopt standardized approach and accordingly the banks are currently implementing the same.
How do you view the recent policy of the Nepali central bank to raise the capital need to rupees two billion for all the commercial banks? Will this affect the performance of the banks? If so, how?
I think this is a good step in the right direction. I do not expect that this will affect the performance of the banks in Nepal.
How do you compare the Nepali banking sector with that of Indian?
Nepali banking scenario is not really comparable with the Indian banking in terms of size, performance and maturity. Nepal will require some time to develop the depth and maturity, as required for a developing country.
“I have confidence in the future of Nepal”
 |
Ravi Jaipuria, Chairman, RJ Corp, an Indian business Group with portfolio ranging from bottling of Pepsi, retail fast food and health industries to education and real estate development, was in Nepal recently to launch the super luxurious housing development project (named Park View Horizon) at Dhapasi, Kathmandu being developed by the group’s Nepali subsidiary Varun Developers, a sister concern of Varun Beverages that bottles and sells Pepsi range of products in Nepal. Excerpts from an interview: |
What is so special about your housing project?
There are many but just to mention some peculiar ones, this is the first environment friendly project approved by the government of Nepal, first ever 15 storey high rise apartment building with earthquake resistant structures, centrally air conditioned and centrally heated, 24 hour hot water flowing, the best security system in the country, swimming pools, Jacuzzis, tennis courts, health clubs, completely safe and secured with high boundary wall.
There is a general saying that the real estate sector has already reached a state of saturation. In such a situation, how do you justify your investment?
I don’t think so. Even as the peace process is taking an encouraging shape, there are lots of people who want to pour into city. So in a way the demand is up. Land prices are still soaring up. People are paid handsomely for selling off their houses. The scenario gets further impetus with the culture of apartments and bungalows taking firm hold among the people. People who have purchasing power and who want to upgrade their lifestyle prefer to live in a community with like-minded people and atmosphere like being offered by us. In a more holistic term, the scenario of the country itself is changing. All the hotels and flights are booked and the businesses are growing. People will have more money to spend. I believe if not all, part of problem of Nepal is now over. The years to come are going to be much nicer. So I foresee there is still a big space left for the real estate sector to grow if not surge.
Who are your target customers?
We don’t want to categorize our customers. Our target customers are all the Nepalis who can afford it. It’s about people who have got the money and who want a great living. If some people have their kin living abroad and want to send money back home to buy a house, our product is important for them. They will never get the state-of-the-art facilities we are offering at that price and in that particular location.
You have been doing business in Nepal for a long time. Have you observed any noticeable difference in the way of doing business compared to 10 years back?
Well, systems and people are changing. The thought patterns and needs of the people are changing. As the youngsters are seeing the new things happening, they want these new things also for themselves. However, because of the unfavourable situation in the country, people are not earning enough money to be able to afford it. But there have been some noteworthy improvements in professional and moral standards of doing business here. As a result, the Nepali corporates are becoming more competent and globally focused. They are not complacent as they used to be 10 years back and all the aspects of doing business here have changed towards positive direction.
First, your business in Nepal was a carbonated drink. Recently there came the beer and now it is real estate. What next?
Something new for sure. I am putting more money into Nepal because I have confidence in the future of Nepal. I have been here for the last 10 years and I will continue to do so. But for now, I am not going to unveil the secret. I can only assure that something new is in the pipeline.
“Logitech is growing beyond IT brand to lifestyle brand”
 |
Subrotah Biswas, Country Manager of Logitech Electronic India Pvt. Ltd., a subsidiary of Swiss company Logitech International, was in Nepal to participate in the CAN Infotech to launch a number of his company products in Nepal’s market. Excerpts from an interview: |
How do you assess your present Nepal visit?
The purpose of the visit was to attend the CAN Infotech. We were the sponsor of the event and this year’s event was re-branded as Logitech CAN Infotech. Our whole idea was to give our commitment to this market. We want to show how serious we are about being in this market and bringing our products and giving our customers options of choosing from huge range of products in IT peripherals. It was a successful visit.
Why were you late in coming to Nepal market?
We wanted to come here with very solid partnership with a strong local partner. The finalisation of the partnership with Neoteric as an exclusive distributor happened just now. However, our product was already in the Nepali market through other importers. We felt that now Nepal looks like getting into, because some kind of socioeconomic stability is already established and there are consumer preferences changing. Consumers are getting more and more exposure to brands. They want to acquire brands and we felt that this is the right time to be penetrate this market.
What market share do you expect in Nepal?
If you look as Logitech as a brand and the kind of offering we have, we really do not have any competitor and we don’t want to compare ourselves with the local and Chinese products. We have to create market awareness through lots of visibility in the shops. Once we create credibility, we will be capturing the entire market. One day, people will understand the state-of-the-art technology offered by us. Logitech is growing beyond IT brand to lifestyle brand.
Will you be opening exclusive outlet for Logitech?
As of now, the exclusivity is only with the distributor. But we will be definitely opening shopping shop concept. So if there is a shop, then we will have Logitech corner to have our branded products. We will have entire range of it placed there so that people know what Logitech has in store.
What do you think about the grey market?
In Logitech, the grey market problem is still limited. It is not that it is zero but we do not see it as a problem.
What are your plans for Nepal?
We will be focusing on channel development to spread our market all over Nepal. Logitech will focus on various underground activities to get connected with the customers.
“Nepal can better Switzerland”
 |
J. Nadchatiram, Managing Director of Yong Lian Realty Sdn. Bhd., Malaysia, was in Nepal recently to attend the AGM of Nepal Merchant Banking & Finance Ltd. in which Yong Lian Realty has a 15% stake. Excerpts from an interview: |
What does your company in Malaysia do?
Yong Lian Realty is a financial institution involved in various undertakings in Malaysia. We are, for example, acting as loan intermediaries, venture capitalists and so on. Besides Malaysia, we were also doing business in another Asian country - Sri Lanka - but later, due to the civil war there, we decided to pull out from there.
How do you find Nepal as a business center?
I have always seen a very bright prospect for Nepal to turn itself into an important business center. Nepal has a big advantage as it is strategically located between two booming economies - India and China. So there is huge potential for your country to establish itself as a business hub in Asia. I see that your market is growing by the day and I hope that you people will make it better than Switzerland one day. The latter, like Nepal, was just a small and poor country surrounded by other European giants at one time. Now you see how it has turned itself around as a provider of the best commercial banking services in the world. I had met the then finance minister of Nepal some 12 years ago on one of my trips here and shared exactly the same view with him.
What difference did you observe in Nepal then and now?
I see that some more financial institutions have come up. If Nepal hadn't been mired by civil strife, it would definitely have made more progress in all sectors, including business. But now, with the changed political scenario, I feel that things are gradually going to fall into place and work all right. Incidentally, I had to wait for three days to get an air ticket to Nepal, which clearly shows that tourist inflow has increased. This is obviously a positive sign for the Nepali economy.
What do you feel should be done to make Nepal into an Asian business hub?
First and foremost, you should have a stable government, which manages its public fund very well. Then you should have proper physical infrastructure in place. Once these are ensured, then everything will fall in line. It will guarantee a proper investment climate and you can expect more FDI pouring into your country. Additionally, you should also take advantage of your rich cultural and natural heritage to attract more tourists to your country. This will contribute to earning valuable foreign exchange for Nepal.
“We’re here to save more lives”
 |
Dr. Lei Zhao, CEO of XinAoMDT Technology Co. Ltd. of China was in Nepal recently for introducing a number of new healthcare systems developed by his company. Excerpts from a brief interview: |
What is the purpose of your current visit to Nepal?
We wanted to introduce new medical technology to enhance better healthcare and save the lives of more cancer patients in Nepal. I am here to officially launch our recently developed Tesla Permanent Magnet MRI System, Comfortscan and Optimus Breast Tumor Detection System and MRI- guided therapy solution in Nepal.
What is your company all about?
XinAoMDT Technology Co. Ltd. (XinAoMDT) is a high-tech joint venture founded by XinAo Group ( China) and Multi-Dimension Technology LLC (USA) with overall investment of RMB 435 million. XinAoMDT is dedicated to innovating and manufacturing intelligent digital medical technologies and products.
What are your company's major contributions?
Today, our company has a team of nearly 20 US scientists and world class engineers who have contributed immensely in delivering high standard and quality products benefiting both humanity and healthcare industry. These include world’s first 0.45 Tesla permanent magnet MRI system, world’s first ultrasound/artificial diffusion breast tumor imaging system, and world’s first commercially available MRI-guided therapy solution.
What are your plans for Nepal?
We will share the features and benefits of our products with Nepal's best surgeons, doctors and hospital administrators. After that we will bring all these advanced intelligent medical technologies to Nepal through Pacific Commercial Trading Company Ltd.
“We have the system, use it”
 |
Jan Markill, Sales Director of EMEA, Global Logistics Network, Descartes System Group Inc. of Denmark, was recently in Nepal during which he made a presentation to the Nepali freight forwarders on the implementation of IT in freight forwarding business. Excerpts from an interview: |
What is the purpose of your visit?
The main purpose is to try and help facilitate the freight forwarding industry here so that it can communicate electronically with the partners and try and save time and money and prepare the Nepali freight forwarding industry for the future looking at customs and all kinds of other requirements that are requested around the world and could be mandatory.
What exactly does Descartes System Group Inc.?
We mainly facilitate the logistics industry with solutions to optimize the business - reduce time and cost. Basically what we do is to connect the people and the logistics industries so that if data has been ended once somewhere in the world, it can be safely reused as it is already there in the chain. We have the system, now you use it.
What is the size of the industry you have targeted here?
I hear there are about 175 couriers in Nepal and hopefully we can get a major share. We don’t really have any set target to meet here because if we can get one then that is better than none. Right now we just try to help out the industry. We will try that they know about the world of electronic interchange and hopefully someone will choose us. But if they choose some other partners to do the interchange, we still feel we have succeeded.
Will you be doing some research to know your market?
My main market, I, of course, know, which is the US and Europe. Then an opportunity came to be out here in Nepal as there came up this reseller that wants to promote our products here and facilitate electronic industry. Of course, it’s what we want to do. Electronic messaging is needed everywhere in the world as well as in Nepal. But I don’t know exactly the market size here. Volumes are not that important. More important is the number of messages sent out so that we can turn them into electronic messaging.
Why did you select Starlight Express to work with?
First, they contacted us and said there is a good opportunity for our products here. They further said that they wanted to be a market leader and that they would try to promote our products here. So, we started to speak with them and made an agreement.
How many of existing Nepali couriers have already started using services from your company?
None so far because today was the first time they heard about us. Hopefully within the next few months, we will see a few companies signing up for the service and that will get the ball rolling.
Do you have any other competitor already in this market?
Yes, there are other companies doing the same business but I am not going to speak about my competitor. Globally, there are about 20 companies that can do some of the things as we do but we are the only one, as far as I know, that can do all transport notes and that has very very good customs regulatory department that can take care of customs.
How many countries do you operate in?
We have customers in about sixty plus countries around the world.
