IFMR Digest Sep 2017

Issue: 1, Sept'17
IFMR Digest
Is it a
fair
game?
Special cover story: Assessing the Relevance of
Country-level Competitiveness Indexes in Asian Economies
Special Convocation Address by
Dr. C. Rangarajan
Former Governor of RBI

T A B L E O F
IFMR ANNOUNCES NEW LEADERSHIP
APPOINTMENTS
2
LEARN TO LEAD AS A BUSINESS ANALYST
5
COVER STORY: ASSESSING THE RELEVANCE OF
COUNTRY-LEVEL COMPETITIVENESS INDEXES
WHAT THE INDIAN POLICY LANDSCAPE HOLDS
6
FOR THE MSME SECTOR
14
CONTENTS
17
TWO YEARS OF DIGITAL INDIA: NEED FOR
EVIDENCE BASED POLICY-MAKING
FLIP THROUGH FOR MORE INTERESTING AND
INFORMATIVE INSIGHTS...

FROM EDITOR'S DESK
T H E I F M R B - S C H O O L N E W S L E T T E R
HELLO EVERYONE,
INFORMATIVE
INSIGHTS
ON BUDGET
VOICE
2017
ALL ABOUT
IT'S
Mimeographing the smooth passage of sunny days
to this beautiful monsoon, we are launching The
IFMR Digest, a brand new quarterly newsletter with
more interesting features for you. The curiosity and
eagerness of students at IFMR to learn something
new has made them research on varied topics and
this research has resulted into some good articles
which we are publishing in this edition
OTHER
ARTIFICIAL
INTELLIGENCE
As said in a famous quote, “Good things come to those who
believe, Better things come to those who are patient and the best
things come to those who don’t give up”.
We-the editorial team believes giving up on anything is the worst
failure of life, so work hard and cherish the fruits of your success.
COLD WAR
AND ITS BUSINESS
PERSPECTIVE
AND MUCH MORE...
Have a good reading ahead…
1

IFMR ANNOUNCES NEW LEADERSHIP
APPOINTMENTS
B Y - N V A G H U L , C H A I R M A N I F M R
IFMR is pleased to announce the
appointment of Mr. ABOUT Kapil SHUTTER Viswanathan SPEED
as President and
Dr. Sunder Ramaswamy as
Vice-Chancellor.
CONCEPT
Mr. Kapil Viswanathan,
President of IFMR
Mr.Kapil Viswanathan is the founder of
Lumina Datamatics (LD), a global
educational content development company
employing over 2,000 employees across
offices in Chennai, Mumbai, New York,
Boston and Frankfurt. Prior to LD, Kapil led
global sales for a division of Tata
Consultancy Services, and served on the
company’s strategic think tank, working
closely with top management on strategy
formulation and customer-centricity. Kapil
holds an MBA from Harvard Business School,
and MS degree in industrial engineering
from Stanford University
2

Dr. Sunder Ramaswamy,
Vice-Chancellor of IFMR
Dr. Sunder Ramaswamy was the
Officiating Director and Visiting
Distinguished Professor at the
Madras School of Economics
(Chennai, India), one of India’s
premier higher education institutes
for economics. He is currently on
leave from Middlebury College,
CONCEPT
one of the top 5 nationally ranked
liberal arts colleges in the U.S.,
where he holds the rank of
Distinguished College Professor of
International Economics.
From January 1, 2009 through
January 31, 2015 he served as the
President and Frederick C. Dirks
Professor of International
Economics at the Monterey
Institute of International Studies, A
Graduate School of Middlebury
College, in Monterey, California. At
the Monterey Institute of
International Studies (MIIS), he led
an ambitious academic
reorganization, a successful
completion of the merger of MIIS
with Middlebury College (June 30,
2010), accelerated fund raising,
scaling up the endowment,
budgets in the black, and increased
Institutional visibility. During his
tenure, the Institute
successfully launched new
graduate degree programs in
nonproliferation and terrorism
studies (NPTS), international
education management (IEM),
international Trade and Economic
Diplomacy (ITED), as well as the
creation of three new research
centers (the Center for the Blue
Economy, the Center for Conflict
Studies, and the Center for Social
Impact Learning), a Cyber Security
initiative, and a number of other
3

innovative programs.
Over the past 25 years he has held
visiting positions at the Madras
School of Economics (India,
including a position as the Director
of MSE from 2003-2005), Vanderbilt
University (USA), Institute of
Financial Management and
Research (India), Purdue University
(USA), and the World Bank (USA).
His prior administrative experience
includes being Dean for Faculty
Development and Research, Acting
Dean of Faculty, and Chair of the
Economics department (all at
CONCEPT
Middlebury College, USA).
His principal fields of specialization
are Development Economics,
International Economics, Issues in
Applied Microeconomics, and
Quantitative Methods. His academic
work has been supported by grants
from the S.W. Davis Foundation,
Ford Foundation, and the Kellogg
Foundation. He has also been a
consultant to UNCTAD, UNIDO,
United Nations University and the
World Bank on specific
development economics projects.
He has coauthored/edited 4 books,
4
written scores of scholarly articles,
and given over 150 talks on four
continents on subjects ranging from
globalization, to economic
development, to Indian economic
reforms, to economics literacy.
Articles featuring him and/or his
views on various economics topics
have appeared in the popular media
(International and Indian) such as,
Access Monterey Peninsula (AMP
Media), The Addison Independent,
Asia Times Online, The Californian,
China Central TV, The Deccan
Chronicle, The Diplomatist, The
Economic Times, Education World,
The Hindu, Hindu Business Line, India
Abroad, Indian Express, India Today,
India West, Industrial Economist, The
Monterey Herald, The Monterey
County Weekly, The New Indian
Express, Rediff.com, SIFY.com, Time
(Asia & Europe editions), and Vermont
Public Radio.
He received his Ph.D. in Economics
from Purdue University (USA), an M.A.
in Economics from the Delhi School of
Economics (India), and B.A. (Honors) in
Economics from St. Stephen’s
College, University of Delhi (India).

LEARN
TO LEAD
A S
A B U S I N E S S
A N A L Y S T
is launching a Post Graduate Certificate
IFMR
in Business Analytics and Big Data,
Programme
association with IBM from October 2017. The
in
shall be delivered by expert faculty
program
IFMR and subject matter experts from
from
IBM.
participants shall not only benefit by
The
hands on experience on IBM suite of
having
and technologies but also on other latest
tools
as well.
tools
Apply Now
For more details on DS Certificate program,
Visit www.ifmr.ac.in/datascience.

COVER STORY
Assessing the Relevance of
Country-level Competitiveness
Indexes in Asian Economies
By Prof. Arindam Das
Institute for Financial Management and Research
Introduction
Competitiveness, a multi-layered economic
concept linked to productivity, essentially
implies the ability of using available
resources to generate more with less.
Country-level competitiveness is normally
defined through factors like: (a) the political
and socio-cultural environment, (b) access
to resources, (c) human talent and social
development, (d) financial competence and
institutional ability to innovate and (e)
leadership and entrepreneurship.
Over the past two decades multiple countrylevel
competitiveness indexes have been
developed by different organizations
and these are considered seriously by the
governments, especially the governments of
developing economies, in order to initiate
appropriate economic reforms in the country
and raise their respective country’s
competitiveness scores. However, there are
unanswered questions about the veracity
and appropriateness of these indexes. This
article reviews a few globally known
competitiveness indexes, analyze structural
validity of the indexes and assess indexes’
ability to explain performance of economies
and firms in key Asian countries.
6

Continuation...
Background
Quantitative, country-level indexes that
measure national competitiveness can
facilitate comparison and benchmarking
among countries. However, researchers
warn that international index rankings, while
popular, are dangerous as they stimulate
rank-seeking behavior. In addition, the weak
theoretical and empirical foundations of
these indexes reduce their true value for
analytical or political purposes and it may be
a risk to formulate policy measures based
on these indicators.
Specific to Asian economies, literature
shows that competitiveness of Asian firms
could be derived from factors and sources
that are different from the ones typically
recognized in Western economies. Asian
firms' competitiveness may come from their
unique nature of operations, their firmspecific
advantages (FSA), and the
mechanisms they develop to deal with
country-specific uniqueness.
Therefore, the critical questions that we
must consider are, do these indexes
reliably present the true state of business
environment in Asian countries, and more
broadly, is it possible to depict the
business environment through a set of
numbers and if yes, how valuable these
numbers are for the primary participants in
economic activities – the firms? The
following sections discuss the findings on
author’s research on: (a) structural validity
of the indexes, (b) comparative analyses of
the indexes and (c) the indexes’ ability to
explain macro- and micro-economic
performances in the nations.
7

Continuation...
Analysis Results
and Discussion
For the purpose of this study, three
indexes have been considered: World
Economic Forum’s Global
Competitiveness Index (WEF GCI), World
Bank’s Doing Business Ranking (WB DB)
and International Institute for
Management Development’s World
Competitiveness Centre Index (IMD
WCC).
Structural Validity
of Indexes
WEF GCI 2016 has three major
components – (a) Basic Requirements, (b)
Efficiency Enhancers, and (c) Innovation
and Sophistication Factors. One of the
unique feature of WEF GCI is that the
weightage of each of the three major
components vary within a range depending
on the current parameters of the countries.
For example, a country with a low
competitiveness will have relatively higher
weightage on basic requirements whereas
an advanced country will have relatively
higher weightage on innovation and
sophistication.
WB DB 2016 has 10 key components
involving starting a new business, dealing
with construction permits, getting electricity,
registering property, getting credit, paying
taxes, protecting minority investors,
trading across borders, enforcing
contracts and resolving insolvency. Each
of these components is evaluated through
multiple factors, many of which are
subject to perception or lacks robust data.
IMD WCC 2016 has four highest-level
components: (a) Economic Performance,
(b) Government Efficiency, (c) Business
Efficiency, and (d) Infrastructure. Under
each of these, there are a large number of
parameters, totaling to 341 parameters
that constitute the IMD WCC Index,
several of which may not have robust
input data.
On analysis of the components, several
issues are noticed about these indexes:
assumption of Utopian business
environment, combining interdependent
factors to arrive at a composite value,
validity of qualitative small sample survey
inputs, and robustness of numerical
inputs. Specifically, nearly 60% of all the
factors that constitute an index are
qualitative inputs gathered through
opinion polls and surveys. There are
doubts about sample size and choice of
respondents. Validity of the input data
points is questionable, as many survey
8

Continuation...
questions appear speculative in nature. For
example, WEF conducts executive surveys
to ask participants to indicate “public trust in
politicians” on a 1-7 scale. In another case,
WB DB Ranking has a parameter for “time it
takes to start a business in a country”. Such
inputs, even if published officially in a
country, would be a range and not a fixed
number, and averaging the range to a
number would lead to loss of information.
Comparative
Alignment of
Index Values
As the indexes essentially attempt to
measure the same features of a country’s
business and economic environment, it is
expected that for a country the index values
should correlate well with each other.
Figures 1 and 2 depict the trend of IMD WCC
Index and WEF GCI for three developed
Asian countries – Japan, South Korea and
Singapore and two developing A countries –
China (mainland) and India. WEF GCI data
is available only from 2006 onwards. WB DB
is not charted, as the data is available for a
few years only.
Figure 1: Trend of IMD WCC Index and WEF GCI for Japan, South Korea and Singapore
9

Continuation...
Figure 2: Trend of IMD WCC Index and WEF GCI for China and India
Time series cross correlation output
between IMD WCC Index and WEF GCI
with zero lag for 10 years’ data shows that
there is no positive correlation between
these two indexes for any of the five
countries. In fact, for South Korea it shows
a negative correlation. The results
indicate
that these two indexes are not in
alignment, i.e., the indexes, though meant
to measure the same thing, do not
correlate and thereby strengthens the
question on the construct of these indexes.
10

Continuation...
Explanatory
Power of Index
Values
Our third question on the indexes is
about their ability to explain business
and economic performance in Asian
countries. Time series cross correlation
analysis between stock market
performance in three countries (Japan,
China and India) and corresponding
IMD WCC indexes indicate that in
almost all cases there is significant
cross correlation. Similarly, cross
correlation between macroeconomic
factors and IMD WCC indexes in the
five Asian countries indicate that except
for Inbound FDI in developed Asian
countries, all other parameters
significantly correlate to the respective
country’s index.
Investigating on microeconomic
performance, no time series cross
correlation is found between firm-level
financial performances with their
respective country index. A select 24
firms from the five countries who have
been listed in 2015 Forbes Asia Fav 50
have been chosen for this analysis.
Explaining the
Key Issues
The key issues with the indexes lie in
their structures, the way data points are
gathered and aggregated, lack of
correlation among indexes and indexes’
inability to relate to firm-level
performances. The reasons are
explained below.
Interdependent input factors with
high level of bivariate correlation: As
large number of constituent factors that
have interrelationship, combination
leads to a value that conveys little. In
addition, most of the indexes measure a
large number of parameters and
combine them to single index – leading
to further loss of meaning.
11

Continuation...
Subjective assessment on nearly 60%
of input factors: More than half of the
inputs come from opinion polls conducted
on questionable sample who may or may
not have sufficient information to provide a
reliable input. While, it is true that we have
to look at subjective inputs, the survey
methodology and parameter identification
should be rigorous.
Assumption on growth trajectory of the
country: WEF GCI assigns different
weightages on different segments,
depending on country’s current position on
growth trajectory. It is assumed that
countries first achieve basic requirements,
then move on to efficiency enhancers and
finally pursue innovation factors. However,
this can be questioned, as for example, it
may be possible for a country to achieve
higher R&D innovation even when there
are issues with basic requirements like
corporate ethics.
Characteristics of Asian businesses: Asian
businesses have several unique FSAs that
outweigh or nullify the requirement of
country-specific advantages. Therefore,
firms with an adverse external
environment may also achieve growth and
profitability at par with international
competitors. In other words, some
disadvantages in Asian countries
perceived by Western analysts as
bottlenecks may not be seen so by the
Asian firms. In such a situation, a
competitiveness index, designed by
Western analysts has limited relevance for
Asian firms.
Indexes’ lack of relevance in the
context of individual firm performance:
While governments, policymakers and
business media accord high level of
importance to competitiveness indexes, for
individual firms, these indexes may not
mean much. The primary reason could be
that many components of an index are
insignificant for an individual firm’s
business. This supports some of the
earlier research that competitiveness is
rooted most importantly in microeconomic
fundamentals.
12

Continuation...
Conclusion
Country-level competitiveness indexes draw significant amount of attention from the
governments, policymakers, businesses and media. While organizations that
develop and publish these indexes insist on deploying appropriate methodology,
research reveals serious questions about the indexes’ robustness as well as their
applicability, especially in the Asian context, and these concerns need to be
addressed appropriately.
About The Author:
Dr. Arindam Das is an Associate Professor in the area of
Strategic Management at IFMR. Prior to IFMR, he worked with
ASCI, Hyderabad where he designed and delivered
management development programs, and was involved in
consulting projects for government departments. Arindam also
worked with a few global consulting and technology services
firms, namely, Accenture, Infosys and TCS. He has been to
some of the leading B-schools in India as visiting faculty for
Strategic Management.
Dr. Das has publications in the areas of corporate governance,
M&A / EJV performance, competitiveness, technology
innovation, supply chain and project management. He holds a
bachelor’s degree from NIT, Calicut, a master’s degree from
ISI, Calcutta and a PhD from IIFT, New Delhi. He is a certified
PMP from PMI and a certified Independent Director from IoD.
13

E X P E R T I N S I G H T
F R O M
I F M R L E A D
B y A n k u r G a u t a m a n d M r i d u l y a N a r a s i m h a n
Researchers at the MSME and
Entrepreneurship vertical at IFMR LEAD
INTERNATIONAL MSME
DAY: WHAT THE INDIAN
POLICY LANDSCAPE
HOLDS FOR THE MSME
SECTOR
In a recent resolution of the UN General
Assembly, June 27 was adopted as the
International MSME Day in recognition of the
role of Micro-, Small- and Medium enterprises
(MSMEs) in achieving the Sustainable
Development Goals (SDGs) and their
contribution to the growth of economies
worldwide – especially in the context of
developing countries. In India, with over 51
million units, MSMEs account for more than
80 per cent of the total number of industrial
enterprises and produce over 8000 value-
added products. These outputs account for 45
per cent of the total manufacturing output
and 40 per cent of the exports from India.
Moreover, the MSME sector provides
employment to over 117 million people in the
country. Increasingly, the Government of
India has acknowledged that MSMEs drive
the growth of the Indian economy and this
acknowledgement has come in the form of
policies directed towards achieving their full
potential. Policy and regulations are crucial in
determining the nature and direction of any
economic activity, therefore, as the world
observes the International MSME day, we
look at some of the recent policies and
14
campaigns of the central government and how
they impact the MSME sector in India.
MAKE IN INDIA
The ambitious ‘Make in India’ campaign is the
government of India’s flagship mission to boost
manufacturing output which certainly does not
ignore the sector. The campaign came with a range
of policy initiatives and investments to tackle the
challenges MSMEs face. The Make in India Soft
Loan Fund launched by Small Industries
Development Bank of India (SIBDI in 2015 offers
loans in the nature of quasi-equity and term loans
on softer terms to meet the required debt-equity
ratio for the establishment and growth of
MSMEs.The government’s Scheme of Fund for
Regeneration of Traditional Industries (SFURTI)
scheme that was launched in 2005 focuses on the
cluster approach, organising traditional industries
and artisans.These individuals are supported
to enhance marketability of their products with
design interventions, improved packaging and
infrastructure under this scheme. 800 clusters were
proposed in the Twelfth Five Year Plan after 71
clusters were developed in the first phase with an
outlay of Rs 149.44 crores The National
Manufacturing Policy has eased regulatory norms
as well. Among the special benefits to SMEs, the
notable ones include a tax pass-through status for
venture capital funds with a focus on SMEs in the
manufacturing sector, liberalization of Reserve
Bank of India (RBI) and Insurance Regulatory and
Development Authority IRDA guidelines for
investments by banks and insurance companies in
SMEs.

SKILL INDIA
GOODS AND SERVICE TAX
The Ministry of MSME which has been awarded the
quality system certification – ISO 9001-2008, is
engaged in skill development programmes besides
providing support, market and fund assistance to
entrepreneurs. The Ministry has set a target of
training 15 million youth by 2022. To achieve this
goal, the Ministry has collaborated with Samsung
Electronics to set up 10 MSME Samsung
Technology Schools for skilling youth in repair and
maintenance of electronics. In the year 2014-15,
The Entrepreneurship Development Institutes (EDI)
made 260,888 youth job-ready through 9,142
programmes. The talent ‘melas’ organised in the
same year provided jobs to 9,000 youth in the
MSME sector. The Central government has been
pushing for linking skilling initiatives like the DDU-
GKY and EST&P to employment outcomes. There is
a symbiosis here as the MSMEs absorb the skilled
youth and in turn benefit from it.
DIGITAL INDIA
Another important initiative of the Government of
India is the ‘Digital India’ movement that focuses on
digitization of the economy. With increasing
penetration of internet-enabled smartphones and a
population that looks up to technology for solutions to
problems big and small, the MSME sector could
become a prominent beneficiary. Several technology
solution providers that have started with a boost from
the ‘Digital India’ movement are attempting to forge
B2B relationships with MSMEs through digital
transactions. Technology platforms have also found
ways to connect MSMEs to buyers, suppliers, financial
institutions and other enabling agencies. Digital India,
though not directly focusing on MSMEs, has been
instrumental in improving the business ecosystem –
from the ease of filling up forms to getting access to
finance and markets.
Perhaps the most talked about policy reform in the
recent terms, the Goods and Services Tax (GST) is
about to roll out in July 2017 and there is an air of
uncertainty and apprehension around it. The reform
will provide equal footing to the big enterprises and
SMEs alike and will remove the tax differentiation on
stock transfer. The GST may turn out to be a mixed
bag for MSMEs. It has been proposed to bring down
the threshold to around Rs 10 lakhs to increase the
tax net. As a result, more MSMEs will come under
GST coverage and their working capital will be
affected. Cost of production is supposed to increase
under the new tax regime as the GST which will be
levied on supply will not be available for input credit.
Further, tax neutrality of GST would mean same
taxation for large businesses as well as SMEs which
will be a difficult position for an SME competing
against a large business.
However, the GST also holds opportunities for the
MSME sector. Due to the standard processes without
slab discrimination for VAT as under the current
regime, MSMEs will find it easier to start business.
Further, the GST eradicating the burden of tax on
interstate sales, will make it easier for MSMEs to
expand to new markets. Transfer of tax credit
irrespective of the location of the buyer & seller,
elimination of border tax procedures and toll check
posts will help in reducing logistical overheads. The
GST is also supposed to enable availing input credit,
single-point tax, and eliminate the cascading tax
system.
15

CONCLUSION
Research indicates that the key aspects that drive
performance of MSMEs in any economy are
institutional & regulatory frameworks,
entrepreneurship, and access to markets and
resources. A strong focus on all these aspects is
seen in the policies that have shaped up over the
past few years. The main constraints for MSMEs
have been lack of access to credit and skilled
labour. With the ever changing landscape of the
MSME sector, there is a need for policies that are
not just good in intent but are also informed by the
growing body of evidence in development
economics on the MSME sector. There is hope that
with the right infrastructure and the business
ecosystem for MSMEs getting attention from
policymakers and the world at large, MSMEs will
certainly go a long way in contributing to the
economic growth of the country and to achieving
the UN Sustainable Development Goals.
Sources:
MSME Sector-Achievement Report 2017. Make in
India
Annual Report 2015-16. Delhi: Ministry of MSME
National Manufacturing Policy 2017, Make in India
Impact of GST on MSME, 2017, Confederation of
Indian Industries (CII)
Ankur and Mridulya are researchers at the MSME
and Entrepreneurship vertical at IFMR LEAD – a
development research organisation housed at the
Institute for Financial Management and Research,
Chennai.
16
*The above article was featured in theindianeconomist.com

E X P E R T I N S I G H T
F R O M
I F M R J P A L
By Arindam Banerjee
Project Manager, J-PAL South Asia
Two years of Digital India: Need for evidence based
policy-making
It has been two years since the launch of the Rs
1.13 trillion Digital India initiative of the Central
Government, aimed to transform India into a
digitally empowered nation by 2018. Significant
reforms and investments including
demonetisation, JAM (Jan dhan, Aadhar and
Mobile) for Direct Benefit Transfer, connecting
50,000 Gram Panchayats with high- speed internet
and digital citizen service centres in rural and semiurban
India, have generated a strong policy debate
on the impact of the government’s digital
initiative.
Questions that matter: While the government’s
efforts have strongly focused on infrastructure
inputs and technology aided public service
delivery, issues concerning internet security,
breach of government data and citizen’s privacy
and poor last mile internet connectivity continue
to be critical to Digital India’s success. What
evidence should policymakers consider to
strengthen impact of digitization of public
services? What factors in implementation design
should be included based on scientific evidence for
last mile service delivery in technology based
welfare programmes? A collection of studies by
researchers affiliated to the Abdul Latif Jameel
Poverty Action Lab (J-PAL) have measured impact
and examining the best processes for these
pressing policy questions.
17
Have digital technology based payments reduced
leakage in social sector programmes?
J-PAL affiliated researchers have collaborated
with the Ministry of Consumer Affairs, Food and
Public Distribution and Government of Jharkhand
for a randomised evaluation to measure the impact
of biometric authentication of beneficiaries
through Electronic Point of Sale (e-PoS) devices in
fair price shops of the Public Distribution System.
Does this step essentially reduce leakage, increase
exclusion, or improve beneficiary experience of
collecting subsidised food grains? In collaboration
with NITI Aayog, researchers affiliated to J-PAL
have also been studying the impact of a pilot Direct
Benefit Transfer (DBT) programme in lieu of PDS
food grains in Chandigarh, Puducherry and Dadra
Nagar Haveli.

Between 2007-2010, the National Sample Size
Organisation (NSSO) estimated nearly 25% leakage
in wages distributed through Mahatma Gandhi
National Rural Employment Guarantee Scheme
(MGNREGS). In Bihar, J-PAL affiliated researchers
tested the effect of an information technology (IT)
reform in the that linked the flow of funds to actual
scheme based expenditures and reduced the number
of officials involved in the overall process. The study
found that the reform reduced program expenditure
by 24 percent without a concurrent decrease in
MGNREGS employment or final wages received,
suggesting that increased transparency reduced
leakages.
Leveraging technology
platforms to facilitate
employment
The expanding reach of mobile phones and internet
connectivity in India is shaping ways through which
employers recruit potential hires and jobseekers
search for potential opportunities. With an estimated
450 million youth having access to mobile phones and
ready to join India’s workforce by 2022, digital
connectivity and social networks have great potential
to improve information access and flow for job
matching. In Karnataka, J-PAL affiliated researchers
are testing strategies for how information on jobs is
disseminated within social networks and how
technology enabled platforms can improve job
searches by the pool of low-income job-seekers.
Mobile technology for
better health outcomes:
The Haryana Immunization Project (HIM), led by J-
PAL affiliates in collaboration with the Government
of Haryana, aims to increase child full immunization
rates, with technology as an integral component.
Firstly, the intervention involves the provision of
non-cash incentives (mobile recharge credit) to the
immunized child’s guardian. Secondly, it leverages
mobile technology to send multiple types of text
messages and interactive voice recordings (IVRs) to
guardians on the progress of immunisation course
completion and targeted reminders before vaccines
are due. The project has also designed and created
its own mobile-health (m-health) application (in
collaboration with researchers at MIT). Over 1,000
Auxiliary Nurse and Midwives (ANMs) have been
trained on the usage of the tablet app to track
immunization of children through the sessions. The
app’s real-time access to health data will inform
decisions of policy-makers, and replacing the paper
record storage may have cost-efficiency.
As the Government of India invests to increase
digital transactions, boost enterprenuer driven
innovations and introduces policy reforms to
strengthen the digital ecosystem, findings from
scientific research can inform Digital India with
effective pathways for desired impact.
Affiliates: Nilesh Fernando (Faculty, University of Notre
Dame), Niharika Singh and Gabriel Tourek (PhD
Candidates, Harvard University)
18

STUDENT ARTICLE
It’s Cold out there..
Countless caveats, a United Nations embargo on
trade and nine missile tests in this year, the
definition of “cold war” has changed with the soring
relation between the United States and North
Korea. With each defiant step of this recluse state’s
ballistic missile test, the temperature of this cold
war is rising. Global imperial capitalist United
States and the autocratic state North Korea, it
won’t be superfluous to say that universal peace or
order is depending upon these two nation’s
calculations of Sharpe ratio.
Though juxtaposing these nations name brews
fresh pot boilers, let us turn towards a neutral
ground to get a holistic picture.1948 was a new
start for Korea as Democratic people’s republic of
Korea. It ended with South Korea’s declaration of
independence, which subsequently led to North
Korea’s invasion and the Korean war. Global
forces acted decisively and in 1953 armistice ends
the war. In 1955 US entered into war with Vietnam
or more specifically Northern Vietnamese
communist forces which lasted for almost 20 years.
Communist countries, though unable to support
straight-out their political ally, were on the side of
Northern Vietnamese forces, the capture of the
USS Pueblo by North Korea on 1968 could also be
interpreted as an act of allies in this context.
Though the evidences of hostility are abundant,
these nations tried to come to an agreement in
1999, after 5 rounds of bilateral talks North Korea’s
obduracy prevailed. It demanded 1 billion annually
from US for halting its missile exports, which is
construed as unfeasible in US diplomatic parlance.
In 1970 USSR worked jointly with this state in its
first long range ballistic missile Programme.
Enriched with almost 200 types of mineral North
Korea is considered as the peninsular mineral hub,
on the other hand the arid lands of the state
compels to it to depend upon imports to some
extent for comestibles. US has maintained a policy
of ‘strategic patience’ or ‘benevolent neglect policy’
towards the monarchy for last 7-8 years. In practice,
it meant US pretended that the country pretended
that the country does not exist. In this mean time
the arsenal size of North Korea increased to almost
20. The growth can’t be taken in absolute terms
because a country with 20 nuclear weapons is not 4
times more dangerous than a country with 5 nuclear
weapons. US’ terms of negotiation that is ‘complete,
verifiable and irreversible denuclearization’ is not
achievable.
What North Korea is looking for is Nuclear
Diplomacy, it is ready to negotiate a freeze imposed
on its nuclear weapons development as a quid pro
quo for a significantly large political or/and financial
aid. For Kim dynasty nuclear deterrent is a red line,
and it is undoubtedly ‘the bargaining chip’ for them.
Decades of rigid state controlled system had led to
stagnation and a leadership dependsent on the cult
personality. The state also stands accused of for
systematic human rights violation. Detention of
foreign citizens (mainly reporters) is a recurrent
event, the recent detention of Tony Kim, a US
citizen added fuel to this. A vet and a militant vying
for supremacy, spectators speculating and
humanity shivering for the looming repercussions of
this game of thrones.
-Swarnendu Biswas
19

STUDENT ARTICLE
Budget 2017, A mendacious
propaganda or an echo of veracity
The Union budget for FY17/18 adopted
a balanced approach. This budget
caused a stir in the hearts of most
bankers, analysts, rating agencies and
policy makers as this budget was
pitched amidst various National and
International economic problems. It
was also expected to be a blueprint for
the policies of the Modi government
after demonetization. In the FY16/17
interest payments casted central
government 46% of the net revenue.
This year there is a totally different
roadmap altogether. The fiscal deficit
target for the next year is 3.2% and the
revenue growth is expected to rise by
17%. This is not only helpful for growth
but, will also help to increase the rating
of our country by different credit rating
agencies.
The expenditures are divided into
three parts
a. Growth accelerating expenditures
b. Expenditures to increase
consumption demand
c. Expenditures for social welfare. The
total amount allocated for expenditures
is 21.47 lakh crores, out of which
revenue expenditures are estimated to
be Rs3.09 lakh crores
This budget aims at providing benefits to
the middle and lower income groups. The
rebates on the Agriculture loan would
help the farmers to get easy and quick
loans which can also help in reducing the
farmer suicidal rate. In the year 2015
-2016, 5650 farmers committed suicide
due to lack of funds. The government
also said that they have increased the
amount of money allocated for NREGA.
The government also promised to build
1crore houses in rural areas to provide
them with accommodation.
The situation seems to be aberrant as the
budget can easily bewilder anyone. The
growth prospects from the budget seem
to be equivocal. For the first time the
railway budget is combined with the
union budget, this gave opportunity to the
government for concealment of some
basic facts.
This time government has allocated
Rs128000cr for transport facilities which
was only Rs21000cr previous year,
however if we compare this budget to the
combined railway and road transport
previous year it turns out to be
Rs30000cr less than the previous year.
Besides this it was also mentioned by
20

STUDENT ARTICLE
our Finance minister that there is a good
amount of increment for the NREGA
scheme from Rs37000crore to 48000cr
this year.
Budget ignores indirect taxes, which can
directly give a relief to people from lower
and middle income groups. There is also
a great distress for Micro, Small &
Medium Enterprises as it was expected
that in this budget some subsidy will be
provided to them because 80% of the
MSME in on the verge of insolvency after
demonetization. The MSME annual
growth rate is presumed to be muted due
to the impact of demonetization on day to
day operations.
The budget allocated only Rs10000cr to
the public banks, which seems quite less.
This comes despite the fact that banks
are jittery about lending money because
of rising non-performing assets. This may
eventually lead to a credit crunch in the
economy. The chief economic advisor, in
his report forecasted the economic
growth rate from 6.5 % to 6.75 %.
The further economic growth is also
dependent on crude oil prices as few
years back it was 100$ which resulted in
providing subsidy for Rs130000cr while
last year it was just Rs 27500cr.
- Akarsh Agarwal
21

STUDENT ARTICLE
Advancement in AI (Artificial
Intelligence)- a Business Perspective
Back in 1800’s when industrial revolution
happened, many speculated of losing their
jobs due to automation, that is, the
assembly line. Yes, many lost their jobs,
but eventually many more jobs came up.
And it certainly gave businesses a chance
to flourish under this new bandwagon and
so did our society. Fast forward to 1900’s,
when the computer revolution happened,
people again feared of losing their jobs
because of the ease of computational work
a computer could do. What happened then
was we saw a whole new world of
opportunities where everyone contributed
as per his/her capabilities and thus we see
a connected world today. Again
businesses, using this shift, helped to
better our society.
Advancement in AI (Artificial Intelligence),
in the present world, has got the similar
properties what the industrial revolution
and computer revolution had back then.
People have already made a notion that
their jobs are under threat due to AI. While
it may take some jobs away, it also opens
up the possibility for completely new jobs
that have not existed prior. Certainly AI
has benefited businesses around the
world; cutting their costs, driving innovation
in the services and so, in every field they
introduce AI.
22

STUDENT ARTICLE
Possibilities of AI in Business
Enterprises can employ AI for everything
from mining social data to driving
engagement in customer relationship
management (CRM) to optimizing
logistics and efficiency when it comes to
tracking and managing assets. AI is
helping us to make our existing
technology smarter and unlocking the
power of all the data that enterprises
collect. Latest research in AI claims to
accurately predict a person’s lifespan.
AI versus Job Loss
Disruption Survey of nearly 11,000
employees in India, by ET online, has
found that a large number of
employees see automation taking
away their jobs. Looking at this survey
results one may take out that people in
India see automation as a real threat
and they know about the tough
business scenario lying ahead of them
and how AI is going to affect their
lives.
workers. Personal care robots and Drone
delivery system are one of the few
examples where machines have already
started replacing us. One should never
forget that we are just witnessing, what
we call as the nascent stage of AI. More
advanced stages of AI are Strong AI and
Super Intelligence AI and with this speed
in the advancement of AI, we are not far
off achieving that and we could just
imagine its impact on us.
The Magnitude of impact of AI in the next
decade is way beyond anything we could
ever imagine.
-Ankitkumar DK
These numbers scare the working
group of the people whose lives may
come under the radar unless a proper
upgrading of skills is not done on
time.
Advancements in the machine
language have made the machines
more responsive and more efficient
when compared to the regular human
23

CONVOCATION
2015-2017 PGDM batch
IFMR held its convocation on April 22nd 2017, for the passing 2015-2017
PGDM batch.
Dr. C. Rangarajan, Former Chairman, Economic Advisory Council to Prime
Minister and Former Governor of RBI and Chairman of MSE honored as the
Chief Guest and delivered the convocation address. Addressing the
convocation, Dr. C. Rangarajan said, “The importance of higher education in
building up a nation is well recognized today. The agricultural, industrial and
scientific growth of this country depends upon creating a corps of well trained
professionals in these areas and this can happen only with good quality higher
education. It is here institutions like IFMR come in and play a crucial role.”
24

CONVOCATION
Dr P K Biswas, Director, IFMR was happy to announce that the students have
got 100 percent placements in top companies through campus recruitment and
the highest salary offered is Rs.18 lakhs by HSBC Capital and was confident
that IFMR graduates will be able to confront problems and find solutions.
“A total of 42 companies visited our campus for placements this year and the
average salary is 9 Lakhs per annum. Some of the major recruiters were
HSBC, J.P.Morgan, Deloitte, KPMG, Credit Suisse etc.”, he added. He also
said that, “IFMR is getting higher ranking and rating as a top class B-School for
last 3 years and Deakin University , Australia has come forward to sign MoU
with us for research collaboration.
"
The importance of
higher education in
building up a nation
is well recognized
today...It is here
institutions like
IFMR come in and
play a crucial role.
"
25

ACCOLADES
NIRF 2017 Ranking
IFMR has been ranked 38 (All
India management schools
category) in Government of
India- Ministry of Human
Resource Development's (MHRD)
National Institute Ranking
Framework (NIRF) for 2017.
The Hindu Business Line - MBAUniverse. com
Annual B-School Ranking 2017
IFMR has been ranked 22 (All India) in The Hindu Business Line-
MBAUniverse. com annual B-School Ranking 2017.
MBAUniverse.com, in partnership with The Hindu BusinessLine
newspaper, released the annual B-school Ranking 2017 on December
22. The Ranking, conducted in guidance of an eminent advisory body
chaired by Dr Bakul Dholakia, Former Director, IIM Ahmedabad, used
a comprehensive 360 degree evaluation framework built around
three criteria: Input, Process and Output. Complete Rankings are
available in this link www.mbauniverse.com/mba-ranking/2017/
26

INAUGURATION OF 2017-19 PROGRAM
IFMR’s 18th batch of post graduate
program in management (and its first ever
MBA batch) were inaugurated on
Thursday 1st June 2017 by its new
President Mr. Kapil Vishwanathan, who
shared about his own MBA days at
Havard Business School. This was
followed by a lively interaction with IFMR’s
largest batch till date – the incoming Batch
with 240 students. Questions ranged from
Macro-economic concerns (Trump effect),
to Conflict between Founders and
Managers (Infy effect).
Prof G R Chandrasekar, PGP Chairman
proposed the vote of thanks.
The induction and orientation programme,
which involved interaction with alumni,
practicing managers, and faculty to get both
functional and sectoral perspectives, was
done on a fast track basis and regular
classes commenced on Monday 12th June
and the campus is already buzzing with
industry focused academic activities ranging
from case discussions to business dissection
of annual reports.
Director PK Biswas mentioned in his
welcome address that the admission
selection process was conducted over a
period of two months across 17 cities; this
batch has students from 97 towns/ cities
spread across 21 states of India. While
IFMR had traditionally enjoyed good
patronage from women applicants and
has a track record of having more than
30% women at all stages – application,
shortlisting, and selection, this year has
been a record with 36% women. “That it
has taken place without any quota or
bonus marks validates our belief that
given fair opportunity, women will
come to management” – said Director
Biswas. While there has been not much
change in the proportion of engineers
(70% +/- 2%) there has been a surge in
students with commerce background this
year (from the usual 17%-18% to 26%.
Prof Suresh Venkatraman, Chairman-
Admissions also shared his perspectives
on management education and
27

STUDENTS INTERNSHIP EXPERIENCE
Having a previous work ex in IT Industry and then moving to capgemini- IT
again, was a wonderful and refurbishing experience. With the glam and
ardor of its name we learnt how consulting has evolved over time and
encountered with different interns from top notch B-Schools which helped
me in gathering the best as MBA teaches us, PEER Learning. To top this
we were assigned with great mentors who helped us in their best possible
way, which I appreciate the most. -Ayaskanta Swain
If you had told me I’d be attending a meeting along with presidents and
CEOs of one of the finest pathology specialist organisation of our country,
working under vice president of Finance department, or aligning them within
auditing process that was discussed in a board meeting, I never would have
believed you. How many people can say that they’ve accomplished that
within such a short amount of time, or even at all during an internship? Well,
I definitely had some of those moments; I also got the chance to participate
in real projects that had a real impact. And yes, talking about my experience
– It was really fascinating and a wonderful experience to work in the
healthcare industry with finance background. - Mitul Mehta
28

STUDENTS'S INTERNSHIP EXPERIENCE
It is always beguiling for a fresher like me, when we enter the corporate
world for the first time. For us, it’s all about the shirts, trousers, ties,
blazer and WORK! The journey of my internship was filled with learning
ranging from life skills which are needed to settle in a new city for having
a knowhow of the workplace ethics. The learning from everyone who was
a part of the company was immense and it definitely paved the way for
me into a fruitful corporate life ahead.- Sahil Sheth
New Bee's Experience
Fresher's Experience at IFMR
I remember the day notification popped up on my phone and I saw the
email from IFMR confirming my admission. The reaction was a burst of
excitement and aflutter. The campus gives you a mix of both. You can
experience the B-school energy , but there are some less travelled roads in
the campus which gives you that much needed solitude when you are
looking for it.
Apart from the overuse of Curry Leaves and the need to shower right after
a shower, everything here makes you feel “I’m going to miss this after two
years!”. So, let’s make the best of it. Of this campus, teachers, students,
friends, gym, weather, location. Everything! We might never find a
concoction of serenity and madness. so well balanced.- Aishwarya Ranjan
29

Fresher's Experience at IFMR
I have never been to south before but have always wanted to. Luckily,
IFMR has fulfilled my wish.
It’s been only 20 days here, but it feels like I know this place for years!!
Coming from north to south for the first time has been a unique experience
with completely different weather, food and language. But IFMR feels like a
home away from home, because I already knew many of my batch mates
through city meets and online IFMR group, thanks to genesis team. Now, I
am having my regular classes and i hope I’ll be able to gain considerable
amount of knowledge and experience. In the nutshell, my overall
experience till now is awesome.- Priti Mathur
30

OUT OF THE
THINKING
(CREATIVE
BOX
LOAN-SHARK SAID
THE
HE WOULD PLACE
THAT
ISSUE 5 2020
FOOD FOR THOUGHTS
THE STORY TIME
THINKING)
In a small Italian town, hundreds of years ago,
a small business owner owed a large sum of
money to a loan-shark. The loan-shark was a
very old, unattractive looking guy that just so
happened to fancy the business owner’s
daughter.
He decided to offer the businessman a deal
that would completely wipe out the debt he
owed him. However, the catch was that we
would only wipe out the debt if he could
marry the businessman’s daughter. Needless
to say, this proposal was met with a look of
disgust.
31
PEBBLES INTO A
TWO
ONE WHITE AND
BAG,
ONE BLACK.
The daughter would then have to reach into
the bag and pick out a pebble. If it was black,
the debt would be wiped, but the loan-shark
would then marry her. If it was white, the
debt would also be wiped, but the daughter
wouldn’t have to marry the loan-shark.
Standing on a pebble strewn path in the
businessman’s garden, the loan-shark bent
over and picked up two pebbles. Whilst he
was picking them up, the daughter noticed

FOOD FOR THOUGHT
that he’d picked up two black pebbles and
placed them both into the bag. He then asked
the daughter to reach into the bag and pick
one.
The daughter naturally had three choices as
to what she could have done:
1. Refuse to pick a pebble from the bag.
2. Take both pebbles out of the bag and
expose the loan-shark for cheating.
3. Pick a pebble from the bag fully well
knowing it was black and sacrifice herself for
her father’s freedom.
She drew out a pebble from the bag, and
before looking at it ‘accidentally’ dropped it
into the midst of the other pebbles. She said
to the loan-shark;
“Oh, how clumsy of me. Never mind, if you look
into the bag for the one that is left, you will be
able to tell which pebble I picked.”
The pebble left in the bag is obviously black,
and seeing as the loan-shark didn’t want to
be exposed, he had to play along as if the
pebble the daughter dropped was white, and
clear her father’s debt.
MORAL
OF THE
STORY
It’s always possible to overcome a
tough situation through out of the
box thinking, and not give in to the
only options you think you have to
pick from.
32

A lawyer runs a stop sign and gets pulled
over by a sheriff. He thinks he's smarter
being a big shot lawyer from New York
and has a better education than an sheriff
from West Virginia. The sheriff asks for
license and registration. The lawyer asks,
"What for?" The sheriff responds, "You
didn't come to a complete stop at the stop
sign." The lawyer says, "I slowed down
and no one was coming." "You still didn't
come to a complete stop. License and
registration please," say the sheriff
impatiently. The lawyer says, "If you can
show me the legal difference between
slow down and stop, I'll give you my
license and registration and you can give
me the ticket. If not, you let me go and
don't give me the ticket." The sheriff says,
"That sounds fair, please exit your
vehicle." The lawyer steps out and the
sheriff takes out his nightstick and starts
beating the lawyer with it. The sheriff
says, "Do you want me to stop or just
slow down?
33

HAPPENINGS @ IFMR
Women In
Business (WIB)-
Abhyudaya
“Abhyudaya 2k17” the flagship event of IFMR,
was held on 10th, 11th & 12th Feb. The
inauguration ceremony was held on 10th Feb
2017 with opening speech given by chief
guests Mr. T.S. Krishnamurthy, Former Chief
Election Commissioner of India and Mr.
Muthu Kumar Thanu, Head of HR at TAFE.
The theme of this year’s abhyudaya was
“Reminisce” It comprised of both managerial,
cultural events .Teams from all over the India
participated in the fest. Notably the colleges
are XLRI, IIT Delhi, IIT Madras, IIM Trichy,
JBIM S, KJ Somiya, Great Lakes, and SIBM
etc. Stand-up comedian Mr. Baggy also
performed. Various other events such
Valuation, Insignis, Battle of Brains, Stunt
Biking, Rock band performance by Chennai
street band , DJ’s etc. where some of the main
highlights of the event.
The speakers club in coalition
with WIB club of IFMR organized
a “Debate Competition” between
the students and the professors on
Women’s day. An event which
attended and applauded by
houseful audience in the Kothari
Hall of IFMR was a huge success.
To mark the women day in the
evening various gaming and eating
stalls were setup by the WIB club
of IFMR.
34

International Yoga Day
Olympics
As a tribute to the Senior Sportcom members of IFMR,
the junior batch organized an “Olympics” tournament
where each senior sportscom members were asked to
select players through an auction. Teams comprised of
seniors and juniors both. Many games like cricket,
volleyball, football, basketball were played over the
period of two days. Winner of the Olympics was decided
by the team winning maximum number of games.
International Yoga Day was celebrated at IFMR on 21st
of June 2017. A great greek philosopher Thales has
rightly quoted as” A sound mind in a sound body ”. So
better the health, better the mind and better the
decisions. Beinghealthy starts with us, IFMR on its
journey of making great future business leaders took a
step forward on this holistic approach this year.When
the clock ticked 6 in the morning ,all the students
gathered around for celebrating yoga day making it end
on a good and powerful note
35

Independence
DAY
CELEBRATION
Director Prof. P.K.Biswas Hoisting the
national flag
Dance and Mime performance by
students
36

The MDP Highlights:
IFMR and TAXMACS (a tax consultancy) have
conducted a one day workshop on GST for industry –
112 participants from 28 companies participated. The
chief commissioner of GST Mr C P Rao delivered the
key note address.
For India’s one of the premier construction
conglomerate; we trained their 1st level of Senior
Management – DGMs on Financial Acumen for
effective decision making- we are looking at this
program to be a recurring one -on a monthly basis
For an Earthmoving equipment supplier – we trained
all functional heads across the organization on
Management in a 4 day offsite program in a
prominent resort.
Industry Institute
Interaction
Mr. Murali Krishna Kishore, General Manager Finance
Division - Vital Solutions, Singapore
shared his expertise on Cross-Border Trade & Trade
Finance. Students actively participated in the interactive
session after the guest lecture on the trade practices
followed nationally and internationally.
37

Institute for Financial Management and Research
About IFMR:
The Institute for Financial Management & Research (IFMR) is a leading business school with
the objective of moulding ambitious young men and women into competent and socially
responsible organisational leaders in a global setting. IFMR’s curriculum offers a mix of theory
with simulated real life exposure and endeavours to shape global business practices through
inventive, sharp thinking and cutting-edge research. IFMR currently offers full-time and parttime
PGDM programmes, a Ph.D programme as well as both open and customised
management development programmes.
For More Information on this
edition, Please Contact:
Priyanka Patil- priyanka.patil@ifmr.ac.in
Nitin Bellani- nitin.bellani@ifmr.ac.in
Address:
Sri City Campus
No. 5655 Central Express Way, Sector 24,
Sri City, Chittoor- 517 646 (A.P)
Advisory Team
Prof. R. Sathyanarayanan- rs@ifmr.ac.in
Prof. Ramkumar Dhurkariram.dhurkari@ifmr.ac.in
Sivakumar C- sivakumar.c@ifmr.ac.in
Chennai Campus
Institute for Financial Management and
Research
No.24, Kothari Road
Nungambakkam, Chennai- 600004
Creative Presentation by:
Dipanjan Bhattacharjee- dipanjan.bhattacharjee@ifmr.ac.in