A ARGENTINA SUBMITTED TO Gujarat Technological University … Reports for Upload/755... ·...

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AGLOBAL / COUNTRY STUDY AND REPORT

ONARGENTINA

SUBMITTED TO

Gujarat Technological University

IN PARTIAL FULFILLMENT OF THEREQUIREMENT OF THE AWARD FOR THE

DEGREE OFMASTER OF BUSINESS ASMINISTRATION

Under the Faculty Guide:Dr Mehul Shah, Mrs. Falguni Puwar and Ms

Sashikala Munka

Submitted by:Enrollment Numbers: 107550592001 to

107550592060MBA SEMESTER -IV

SARDAR PATEL COLLEGE OF ADMINISTRATION &MANAGEMENT (SPCAM-MBA)

May 2012

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STUDENTS DECLARATION

We 107550592001 to 107550592060 Students of SARDAR PATEL COLLEGE OF

ADMINISTRATION & MANAGEMENT (SPCAM-MBA) Bakrol,, hereby declare that

the report for A GLOBAL / COUNTRY STUDY AND REPORT ON ECONOMIC

POLICY OF ARGENTINA is a result of our own work and our indebtedness to other

work publications, references, if any, have been duly acknowledged.

Place : .. Date :

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PREFACE

In today’s competitive environment, survival of the fittest is the new motto. That is why

it’s necessary that the theoretical knowledge is accompanied by practical knowledge. In

an MBA programmer, project study forms an important and an integral part. It helps in

bridging the gap between the two main important aspects the theoretical as well practical

knowledge.

“Knowledge and Human Power are synonyms”, once said the great philosopher Francis

Bacon. However based on the experience within today’s global markets, he would

probably say, “The ability to capture, communicate & leverage knowledge to solve

problems is human power”. This raises the question how exactly one can best capture,

communicate & leverage knowledge, especially within world of system engineering.

With the help of the county report we can get the information about the both country and

the position of the both country and make compare both the country so we can say that

which country is good and which country are linked with which country.

So the country report is also helpful to show the country’s economy and all the rank like

GDP and all that. With help of the country we get the information about the import and

export of that country with other country and which things are more import and export

form the country.

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ACKNOWLEDGEMENT

We have the pleasure to present herewith the study work on economic policy of

Argentina. Working on this project has been a great learning experience. Numerous

individuals helped us a lot with all sort of queries that we had and without the help of

them, we would never be able to complete this Country Project. We would like to use this

opportunity to thank them.

We are extremely indebted to our guides (Dr Mehul Shah, Mrs Falguni solanki puwar

and Ms Sashikala Munka) who have taken great pains to provide us guidance to make

this project. She is always there to help us a lot by giving her valuable guidelines and

suggestions to complete this study from start to end. She is the person who inspired us to

explore such an emerging sector of economy. She inspired us to be systematic in our

work. She explained that how to go ahead for studying such topic and also explained the

technical and other dimensions of the same. We want to thank our Director General-

SPEC, Dr. T. D. Tiwari for giving us an opportunity to work on this task.

Lastly, we express our gratitude to the faculty of SPCAM and want to thanks GTU for

giving us a chance to work on such practical task. We are aware that there are a number

of people who have helped us to do this project but we may have failed to make a

mention of them. We take this opportunity to express our sincere gratitude to all those for

their assistance and support.

Thanking All,

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Executive summary

The economic history of Argentina is one of the most researched, owing to the"Argentine paradox", its unique condition as a country which had achieved advanceddevelopment in the early 20th century but experienced a drawback, which inspired awealth of literature and analyses on the causes of its decline.

Argentina has a market-oriented economy with a lot of natural resources, a well-educatedpopulation, an export-oriented agricultural sector and a relatively diversified industrialbasic exposure.

The nation's services sector accounts for around 59% of the economy and 72% ofemployment, manufacturing is 21% of GDP and 13% of employment, and agriculture is9% of GDP, with 7% of employment; construction, mining, and public utilities divide therest. Agriculture, including processed goods, provided 54% of export earnings in 2010;however, while industrial manufactures accounted for 35% (energy staples and metal oreswere most of the remainder).

As Argentinean society is very status conscious, it is important to address colleagues withthe proper title followed by only his or her father’s surname, unless invited to do sootherwise.

Many Argentinean women are well educated and more are entering the workforce.However, women tend to leave the workforce upon having children, but a commonPractice with many Argentinean women is to hire a nanny so that they may return towork.

The Economy of India is the 11th largest in the world by nominal GDP and the thirdlargest by purchasing power parity (PPP). The country is one of the G-20 majoreconomies and a member of BRICS. In 2011, the country's per capita income stood at$3,694 IMF, 129th in the world, thus making a lower-middle income economy.

The human development index in the Argentina is 0.86 while in the India it is 0.609.

The GDP per capita in the Argentina is $14700 US while in India it is $3500 US.

The Argentina exports the soybeans and derivatives, petroleum and gas, vehicles, corn,wheat etc.while the India exports petroleum products, textile goods, gems and jewelry,engineering goods, chemicals, leather manufacturers.

Finally study of global country report shows that the life expectancy, human developmentindex, literacy rate, GDP per capita, unemployment rate, political system, exchange rateand export import policy of both the countries and their comparison.

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INDEX

Sr. No Particular Total page no SemesterPart I ECONOMIC OVERVIEWOF THE SELECTED COUNTRY

05-23 III

1 Argentina Demographics Profile 2011 IIIPART – II INDUSTRY / SECTOR 23-202 IV

Banking SectorEconomic SectorTransportation SectorAdvertising And MediaEntrepreneurshipExport Import SectorRural SectorManagement InformationRetail SectorLogistic SectorBibilography 203-205 IV

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Part-I

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BRIEF INTRODUCTION ABOUT THE ARGENTINA

Argentina has a population of 33 Million with an ethnic composition of 85 percent

European descent, primarily Spanish or Italian. Indians, mestizos (people of mixed Indian

and Spanish ancestry), and blacks together make up the remaining 15 percent. The

Republic of Argentina is a democracy for now, but has had a long history of military

power.

Spanish is the official language, although many people speak English, Italian, or other

languages. Argentine Spanish is heavily influenced by Italian and is unlike Spanish

spoken anywhere in Latin America. Church and state are officially separate, but about 90

percent of the population considers itself Roman Catholic. Jews and Protestants account

for 2 percent each. Eighty percent of the population resides in cities or towns of more

than 2,000, and over one-third lives in the greater Buenos Aires area.

Comprising almost the entire southern half of South America, Argentina is the

world's eighth largest country, covering an area of 2.8 million square km. Argentina

possesses some of the world's tallest mountains, expansive deserts, and impressive

waterfalls, with the diversity of the land ranging from wild, remote areas in

southern Patagonia to the bustling metropolis of Buenos Aires in the north.

POPULATIONArgentina: 41,769,726 (July 2011 est.)World Population 7 Billion

MEDIAN AGE

Total:30.5yearsMale:29.5yearsFemale: 31.6 years (2011 est.

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POPULATION GROWTH RATE

Argentina: 1.017% (2011 est.) India: 1.41%,Birth rate17.54 births/1,000 population (2011 est.)

Nationality: - Argentine(s)

ETHNIC GROUPS

White (mostly Spanish and Italian) 97%, mestizo (mixed white and Amerindianancestry), Amerindian, or other non-white groups 3%

RELIGIONS

nominally Roman Catholic 92% (less than 20% practicing), Protestant 2%, Jewish 2%,other 4%

LANGUAGES

Spanish (official), Italian, English, German, French

LITERACY

Definition: age 15 and over can read and write.

Total population: 97.2%

Male: 97.2%

Female: 97.2% (2001 census)

SCHOOL LIFE EXPECTANCY (PRIMARY TO TERTIARY EDUCATION)

Total: 16 years

Male: 15 years

Female: 17 years (2007)

EDUCATION EXPENDITURES

4.9% of GDP (2007)

MATERNAL MORTALITY RATE

70 deaths/100,000 live births (2008)

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CHILDREN UNDER THE AGE OF 5 YEARS UNDERWEIGHT

2.3% (2005)Official Name:República Argentina (Spanish)Argentine Republic

Capital (largest city) Buenos Aires 34°20′S, 58°30′W

Official languages Spanish

ARGENTINA GDP GROWTH RATE

The Gross Domestic Product (GDP) in Argentina expanded 2.50 percent in the second

quarter of 2011 over the previous quarter. Historically, from 1993 until 2011, Argentina's

average quarterly GDP Growth was 0.96 percent reaching an historical high of 3.70

percent in March of 2003 and a record low of -5.70 percent in December of 2001.

Argentina is the third largest national economy in Latin America. Argentina has abundant

natural resources, a well-educated population, an export-oriented agricultural sector and a

relatively diversified industrial base.

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STANDARD OF LIVING IN ARGENTINA

Standard of Living in Argentina promises a fulfilling life in a beautiful, diverse and

culturally rich country. It is the second largest country in South America and the

8th largest in the world. It is divided into four main parts: the Pampas, a flat area of land

in the centre; Patagonia; a large area of expanse in the south; the sub tropical North and

the Andes mountain range.

ECONOMIC OVERVIEW

Argentina's economy is one of the richest and most diversified in Latin America. The

nation has a variety of natural and other resources which have combined to produce an

economy that is based on a strong industrial base, an export-oriented agricultural sector,

and a growing service sector. The Argentine population is highly educated and skilled,

and the country has a variety of natural resources including lead, zinc, copper, iron

petroleum, uranium, and rich agricultural areas.

However, after repeated periods of military dictatorship, the nation faced a variety of

economic problems when the first sustained period of civilian control of the government

began in 1983. By 1989, the nation had an enormous external debt, and inflation had

reached a level of 200 percent per month. In response, the government undertook a

variety of programs to reform and reinvigorates the economy.

The economy bottomed out that year, with real GDP 18% smaller than in 1998 and

almost 60% of Argentines under the poverty line. Real GDP rebounded to grow by an

average 8.5% annually over the subsequent six years, taking advantage of previously

idled industrial capacity and labor, an audacious debt restructuring and reduced debt

burden, excellent international financial conditions, and expansionary monetary and

fiscal policies. Inflation also increased, the rapid economic growth of previous years

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began to slow sharply the following year as government policies held back exports and

the world economy fell into recession.

Real economy: Reviving economic activity, the government’s aggressive fiscal stimulus,

and an increase in external demand has facilitated Argentinean growth which is forecast

to continue over the next year. Forecast calls for GDP to grow 5.0% y/y in 2011.

Inflationary pressures are expected to remain high.

External sector: Strong domestic demand and the real appreciation of the peso

contributed to strong import growth so far this year. Export growth mainly driven by soya

exports was not enough to offset the import boom, resulting on a smaller trade surplus.

Fiscal sector: The government has completed the bond swap with commercial creditors,

and although it has not yet attempted to access international capital markets, we

anticipate it will do so at some point next year. Fiscal spending is anticipated to remain

strong in face to the 2011 elections, which will exacerbate the overheating of the

economy.

Monetary sector: The Central Bank has also been adopting expansionary monetary

policy to instigate growth. The CB will soon be forced to tighten monetary policy in

order to contain inflation.

Growth Rate: The Gross Domestic Product (GDP) in Argentina expanded 2.50 percent

in the second quarter of 2011 over the previous quarter. Historically, from 1993 until

2011, Argentina's average quarterly GDP Growth was 0.96 percent reaching an historical

high of 3.70 percent in March of 2003 and a record low of -5.70 percent in December of

2001. Argentina is the third largest national economy in Latin America. Argentina has

abundant natural resources, a well-educated population, an export-oriented agricultural

sector and a relatively diversified industrial base. Domestic instability and global trends,

however, contributed to Argentina's decline from its noteworthy position as the world's

10th wealthiest nation per capita in 1913 to the world's 47th wealthiest in 2008.

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Nominal GDP (2010): 310 bil USD. GDP to grow 5.0% in 2011.

Total Trade/GDP (2010): 37 %

Currency: Argentine Peso (ARS)

Exchange regime: Managed float

GENERAL INFORMATION: - INDUSTRIAL TRADE AND COMMERCE

Argentina is located in the South and West Hemisphere. Its relative position in South

America gives the country a diversity of land and culture.

Argentina is grouped into six geographical regions:

Northwest, the fertile valleys concentrate most of the population of the area, and

the economic activities.

Gran Chaco, the Chaco offers soil fertility and topography that are favorable for

agricultural development, but in combination with aspects that are challenging for

farming :

Mesopotamia, maté and tobacco is the most important product for the north of the

region, although farmers have increasingly cultivated tea, tung trees (from which

tung oil is derived), and citrus crops.

Cuyo, viticulture is one of the main activities of the area. The wine production of

the region represents almost 80% of national production, and the wines are highly

considered in the world.

Pampas, is located in Central Argentina, a successful agricultural region with

crops grown on the Pampas south and west of the Buenos Aires.

Patagonia, principal economic activities have been mining, whaling, livestock

(notably sheep throughout) agriculture (wheat and fruit production near the Andes

towards the north), and oil.

Argentina has following main industries for trade and commerce,

Food processing,

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Motor vehicles and Auto parts,

Appliances and electronics,

Petrochemicals and pharmaceuticals,

Steel and Aluminum,

Textiles.

EXPORT GOODS

Soybeans and byproducts, 25.3%; motor vehicles and parts, 11.8%; cereals (mainly

maize and wheat), 6.9%; chemicals, 6.7%; natural gas and petroleum, 5.3%; refined fuel,

4.1%; aluminum and steel, 3.9%; fruit and vegetable products, 3.9%; electric machinery,

3.2%; gold, 3.0%; other industrial products, 6.5%; all other (mainly processed

agricultural goods), 19.4%. (2010)

4%4%

4%

3%

3%

7%

19%

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Steel and Aluminum,

Textiles.

EXPORT GOODS






25%

12%

7%7%5%

4%

Export Goods

Soybeans and byproducts

motor vehicles and parts

cereals

chemicals

natural gas and petroleum

refined fuel

aluminum and steel

fruit and vegetable products

electric machinery

gold

industrial products

processed agricultural goods

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Steel and Aluminum,

Textiles.

EXPORT GOODS






Soybeans and byproducts

motor vehicles and parts

cereals

chemicals

natural gas and petroleum

refined fuel

aluminum and steel

fruit and vegetable products

electric machinery

industrial products

processed agricultural goods

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Major Trade partners:

Brazil, China, Chile, United States and Germany.

IMPORT GOODS

Capital goods and parts, 36.0%;intermediate goods, 31.3%; automobiles and parts, 8.7%;

refined fuel and lubricants, 7.9%; consumer durables (except auto), 4.9%; freight

vehicles, 4.9%; all other (mostly consumer non-durables), 6.3%. (2010)

9%

8%

5%5%

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IMPORT GOODS




36%

31%

5%6%

Import Goods

Capital goods and parts

intermediate goods

automobiles and parts

refined fuel and lubricants

consumer durables

freight vehicles

other

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IMPORT GOODS




Capital goods and parts

intermediate goods

automobiles and parts

refined fuel and lubricants

consumer durables

freight vehicles

other

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OVERVIEW OF DIFFERENT SECTORS

1) Agriculture

Argentina is one of the world's major agricultural producers, ranking among the top

producers and, in most of the following, exporters of beef, citrus fruit, grapes, honey,

maize, sorghum, soybeans, squash, sunflower seeds, wheat, and mate. Agriculture

accounted for 9% of GDP in 2010, and around one fifth of all exports (not including

processed food and feed, which are another third). Commercial harvests reached 103

million tons in 2010, of which over 54 million were oilseeds (mainly soy and sunflower),

and over 46 million were cereals (mainly maize, wheat, and sorghum). Soy and its

byproducts, mainly animal feed and vegetable oils, are major export commodities with

one fourth of the total; cereals added another 7%. Cattle-raising is also a major industry,

though mostly for domestic consumption; beef, leather and dairy were 5% of total

exports. Sheep-raising and wool are important in Patagonia, though these activities have

declined by half since 1990.

Fruits and vegetables made up 4% of exports: apples and pears in the Río Negro valley;

rice, oranges and other citrus in the northwest and Mesopotamia; grapes and strawberries

in Cuyo (the west), and berries in the far south. Cotton and tobacco are major crops in the

Gran Chaco, sugarcane and Chile peppers in the northwest, and olives and garlic in the

west. Yerba mate tea (Misiones), tomatoes (Salta) and peaches (Mendoza) are grown for

domestic consumption. Argentina is the world's fifth-largest wine producer, and fine wine

production has taken major leaps in quality. A growing export, total viticulture potential

is far from having been met. Mendoza is the largest wine region, followed by San Juan.

2) Natural resources

Mining is a growing industry, increasing from 2% of GDP in 1980 to nearly 4% today.

The northwest and San Juan Province are the main regions of activity. Coal is mined in

Santa Cruz Province. Metals mined include copper, zinc, magnesium, sulfur, tungsten,

uranium silver, and particularly, gold, whose production was boosted by recent

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investments from Barrick Gold in San Juan. Metal ore exports soared from US$ 200

million in 1996 to US$ 1.2 billion in 2004, and to over US$ 3 billion in 2010.

3) Industry

Manufacturing is the largest single sector in the nation's economy (19% of GDP), and is

well-integrated into Argentine agriculture, with half the nation's industrial exports being

agricultural in nature.[7] Leading sectors by production value are: food processing,

chemicals and pharmaceuticals, motor vehicles, farming equipment and auto parts, iron,

steel and aluminum, petroleum, as well as industrial machinery and home appliances.

These latter include over three million big ticket items, as well as an array of electronics,

kitchen appliances and cellular phones, among others. Beverages are another significant

sector, and Argentina has long been among the top five wine producing countries in the

world, though in 2000, beer overtook wine production, and today leads by nearly two

billion liters a year to one.

4) Services

The service sector is the biggest contributor to total GDP, accounting for over 60%.

Argentina enjoys a diversified service sector, which includes well-developed social,

corporate, financial, insurance, real estate, transport, communication services, and

tourism.

The telecommunications sector has been growing at a fast pace, and the economy benefits

from widespread access to mobile telephony (more than 75% of the population having

access to mobile phones), Internet (more than 16 million people online), and broadband

services. Regular telephone services with 9.5 million lines and mail services are robust.

5) Banking

Argentine banking, whose deposits exceeded US$90 billion in November 2010,

developed around public sector banks, but is now dominated by the private sector. The

private sector banks account for most of the 85 active institutions (4,000 branches) and

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holds nearly 60% of deposits and loans, and there are as many foreign-owned banks as

local ones. The largest bank in Argentina by far, however, has long been the public

Banco de la Nación Argentina. Not to be confused with the Central Bank, this institution

now accounts for about a fourth of the total deposits and a seventh of its loan portfolio.

During the 1990s, Argentina's financial system was consolidated and strengthened.

Deposits grew from less than US$15 billion in 1991 to over US$80 billion in 2000, while

outstanding credit (70% of it to the private sector) tripled to nearly US$100 billion.

The banks largely lent US dollars and took deposits in Argentine pesos, and when the

peso lost most of its value in early 2002, many borrowers again found themselves hard

pressed to keep up. Delinquencies tripled to about 37%.[50] Over a fifth of deposits had

been withdrawn by December 2001, when Economy Minister Domingo Cavallo imposed

a near freeze on cash withdrawals. The lifting of the restriction a year later was

bittersweet, being greeted calmly, if with some umbrage, at not having these funds freed

at their full U.S. dollar value. Some fared worse, as owners of the now-defunct Velox

Bank defrauded their clients of up to US$800 million.

6) Tourism

The World Economic Forum estimated that, in 2008, tourism generated around

US$25 billion in economic turnover, and employed 1.8 million. Tourism from abroad

contributed US$ 4.3 billion, having become the third largest source of foreign exchange

in 2004. Around 4.6 million foreign visitors arrived in 2007, yielding a positive balance

vis-à-vis the number of Argentines traveling abroad.

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INDIA – ARGENTINA RELATIONS – BUSINESS

Bilateral Trade figures for 2011 (in million dollars)

Argentina

Jan-Sep 2011 Jan-Sep 2010

India´s Exports 408 341

India´s Imports 1112 1650

Argentina

2010 2009



Year 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000

India’s exports 496 342 492 384 303 261 160 136 85 151 143

India’s imports 2032 876 836 859 929 739 567 558 404 446 442

The trade is very much below the potential. During the visit of the President of Argentina

to India in October 2009, the two Governments set a target of 3 billion dollars of bilateral

trade by 2012.

IMPORTS OF INDIA FROM ARGENTINA (2010)

ITEMS IN MILLION US $

SOYBEAN OIL 1843

SUNFLOWER OIL 36

LEATHER 30

AIR PUMPS AND COMPRESSORS 16

SUGAR 15

CORN 13

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MAJOR ARGENTINE EDIBLE OIL EXPORTERS TO INDIA

CARGIL

MOLINOS RIO DE LA PLATA

VICENTIN

LUIS DREYFUS

AGD

BUNGE

Business Basics

Success in the Argentine market depends on everything from understanding government

regulations and tariffs and knowing the right labeling and packaging to use in shipments,

to working in accordance with local business practices. Getting the basics down can

prepare you for market entry and success.

The International Federation of Trade Associations, (FITA), whose members include

more than 450,000 trade-related organizations, created this resource, which provides an

introduction to the market in Argentina. There are the economy and political structure,

business environment and rules for buying, selling and operating a business in Argentina.

Cultural Issues

Business success abroad depends not only on the quality of your products and services,

but also on the knowledge and respect you show for the customs and manners of business

people in your host country. These will help the country to ensure that your business

conduct in Argentina makes a positive impression.

Business etiquette

Although Argentine business people are time-conscious and are convinced that time is

money, a sense of urgency may be viewed with mistrust or as rudeness.

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It is not uncommon for meetings to be held in an informal environment, such as a bar or

restaurant. Many Argentines will not try new things until they have been thoroughly

tested and accepted.

Business commitments and promises made in a social context need to be verified in a

work environment.

TARIFF BARRIERS

On January 1, 1995, Argentina implemented the Mercosur Common Nomenclature

(MCN), consistent with the Harmonized System. Most duties are ad valorem (%)

assessed on the CIF value.

Tariff rates depend on whether the same goods are produced in Argentina and also on the

stage of manufacture. Rates range from 2.5 per cent to 20 per cent for virtually all

finished goods, with an average of 14 per cent.

Certain non-competing capital goods and medicines are admitted duty free. Basic food

items and raw materials: 2.5 per cent; most capital goods 14 per cent; consumer goods

such as clothing, motor cars and home appliances 20 per cent.

Certain primary and intermediary goods used in the manufacture of exports are exempt

from duty if the final product is exported within a year. Importers should obtain approval

for duty exemption from the National Institute of Technology and Industry.

NON-TARIFF BARRIERS

Although there are almost no prohibitions for imports, certain products require an import

license or approval of the appropriate ministry. Some of the products requiring licenses

are pharmaceuticals, foodstuffs, insecticides, medical devices, defense materials, etc.

Importers must be listed with the National Tax Authority and obtain an importer license

number. A quota on motor cars is still in effect. However, the quota has been gradually

increasing in recent years. There are also quotas on paper, pulp and footwear.

Insurance

If the transport risk is borne by the Argentine importer, goods must be insured in

Argentina with a licensed insurance company.

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Taxation

The Australian-Argentine Double Taxation Agreement came into effect in 1999, and is

for the avoidance of double taxation to income flowing between Australia and Argentina.

This Agreement assists Australian companies with subsidiaries or branches in Argentina

to be taxed in Argentina and in Australia for the incomes generated by their foreign

operations, and vice-versa.

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Part –II

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Banking Sector

Introduction of Banking sector

India Argentina GujaratReserve Bank of In India isIndian Central Bank andcurrently resides in Mumbaias opposed to its originalhome of Calcutta.Established in 1935 and likemost central banks its mainfocus is to maintainthe monetary stability ofcountry.

Banks in India wereestablished in the pre-independence era to offerfinancial aid toagriculturists, traders andbudding industrialists.

There are private banks,public sector banks andforeign banks. The oldest isthe State Bank of Indiaexisting in India from 1806and is the largestcommercial bank today.

Later, between the periodsof 1969 to 1980, twentycommercial banks becamenationalized. However,private banking was alsoentertained.

The structure of banking inIndia comprises ofscheduled and unscheduledbanks. The schedulecommercial banks are thosethat satisfy the criteria laidby RBI.The Indian money market is

The Central Bank ofArgentina, was establishedon May 28th, 1935 to act ascountry’s financial agent.Central Bank is also knownas the “BCRA”. The Bankis run by a board containinga Governor, two DeputyGovernors, and eightdirectors. The headgovernor is responsible formanaging affairs with thirdparties, while the deputygovernors are attributedwith an assistant position.In case that the headgovernor is temporarilyunavailable, one of theDeputy Governors can takehis/her place. All of theGovernors and directors aremembers of the board ofdirectors, which isresponsible for assuringfinancial growth for theeconomy of Argentina.Leadership positions withinthe bank are appointedposition rather than anelected one, therefore theExecutive branch of thegovernment has virtualcontrol of the bankingand currency system.

When it was formed thebank had replaced thecountry’s Currency Board,which was flawed in manyways – predominately in thefact that credit was given

Gujarat is one of the mostprosperous states in theIndian Republic. Thebanking and financialinstitutions of Gujarat arealso well developed and itprovides financial servicesto its customers and it isunder the regulatoryauthority of the governmentwhich include banks, stockbrokers, asset managementfirms and similar functionbusinesses.

The Gujarat StateCooperative Bank (GSCB)and district cooperativebanks have decided toimplement core bankingsolutions (CBS) forproviding efficient bankingservices to their customers.The 11 co-operative banksin Gujarat - GSCB and 10district cooperative banks inAhmedabad, Vadodara,Bharuch, Bhavnagar,Jamnagar, Kodinar, Rajkot,Sabarkantha, Surendranagarand Valsad — signed theagreement for CBS with.

Industrial powerhouse ofwestern India is Gujarat.

The banks of Gujaratinclude both governmentand private sector bankslike Citi Bank, State Bankof India, Allahabad Bank,

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classified into the organizedsector, comprising private,public and foreign ownedcommercial banks andcooperative banks, togetherknown as scheduled banks,and the unorganized sector,which includes individualor family owned indigenousbankers or money lendersand non-banking financialcompanies.indigenous bankers ormoney lenders and non-banking financialcompanies. Theunorganized sector andmicrocredit are stillpreferred over traditionalbanks in rural and

Sub-urban areas areespecially for non-productive purposes likeceremonies and shortduration loans.

Prime Minister Mrs. IndiraGandhi Nationalized 14banks in 1969 followed by6 others in 1980 & made itmandatory for banks toprovide 40% of their netcredit to priority sectors like(1) agriculture (2) small-scale industry (3) retailtrade (4) small businesses &etc. to ensure that the banksfulfill their social anddevelopmental goals. Sincethen, the number of bankbranches has increased from8,260 in 1969 to 72,170 in2007 and the populationcovered by a branchdecreased from 63,800 to

out too freely and thesystem was being abused.Many regulations arerelated to credit, creditcannot be given out to thosewithout merit; there must bestrict agreements in placeabout the paymenttimetable.

Argentine banking wasinitially developed throughpublic sector banks but nowit is dominated by privatesector banks. The privatesector banks account formost of the 80 activeinstitutions (over 4,000branches) and holds nearly60% of deposits and loans,and as many foreign-ownedbanks as local ones operatein the country. Any how thelargest bank in Argentina sofar, has long been the publicsector bank, Banco de laNación Argentina. Thisinstitution now accounts forabout one fourth of the totaldeposits and one seventh ofits loan portfolio.

During the 1990s,Argentina's financial systemwas consolidated andstrengthened. Deposits grewfrom less than US$15billion in 1991 to overUS$80 billion in 2000,while outstanding credit(70% of it to the privatesector) tripled to nearlyUS$100 billion.

Argentine population hasmade more deposits

HDFC Bank among others.

The primary function of thebanking and financialinstitutions in Gujarat isto act as intermediariesbetween the capital and debtmarkets. The banking andfinancial institutionstransfer funds from theretail or institutionalinvestor to those companieswhich require funding. Thepresence of banking andfinancial institutions inGujarat ensure the properflow of money through theregional economy.

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15,000 during the sameperiod. The total bankdeposits increased from5,910 cr. (US $1.18 billion)in 1970–71 to 3,830,922cr. (US $764.27 billion) in2008–09. Despite anincrease of rural branches,from 1,860 or 22 percent ofthe total number ofbranches in 1969 to 30,590or 42 percent in 2007, only32,270 out of 5 lakhsvillages are covered by ascheduled bank

overseas than in ArgentinaBanks. The major reasonfor this is found out to bebecause of past instabilityof argentine economy. Theestimated deposits inoverseas account areUS$156 billion andinvestment exceeded thedomestic monetary base(M3) by nearly US$20billion in 2011.

Major banks

india Argentina Gujarat Abu DabhiCommercial Bank

Andhra bank Bankof Baroda

Bank of Maharashtra Central Bank OfIndia

Corporation Bank Dena bank UCO Bank Union Bank of India UTI Bank Yes Bank Federal Bank HSBC Bank IDBI bank Indian OverseasBank

IndusInd Bank ING Vysya Bank Karnataka bank Karur Vysya Bank Punjab National Bank South Indian Bank

Banco de la NacionArgentina

Banco Provincia Santander Río

(formerly Banco Río dela Plata

BBVA Banco Francés Banco de Galicia Banco Macro HSBC Argentin Ciudad Citibank n.a. Hipotecario Credicoop Standard Bank

Argentina Banco Patagonia uevo Banco de Santa

Fen De Cordoba Comafi Supervielle Nuevo Banco Bisel Itau Buen Ayre

The Social Coop BankLtd.,

The Sutex Co operativeBank Ltd.

The Vardhman Co-operative Bank Ltd.,

Udhana Citizen Co-operative Bank Ltd.

Uma Cooperative BankLtd.,

Umreth Urban Co opBank Ltd.

Una Peoples' Co-op.Bank Ltd

Unava Nagrik SahakariBank Ltd.

Union Co op BankLimited

United Coop Bank Ltd Unjha Nagarik

Sahakari Bank Ltd Uttarsanda Peoples

Coop Bank Ltd; Vadali Nagrik Sahakari

Bank Ltd.

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Major banks
























Bank Ltd.

26



Major banks
























Bank Ltd.

27

Standard CharteredBank

State Bank ofSaurashtra

Allahabad Bank ABN AMRO Bank Bank of India Canara Bank Citibank DBS Bank Dhanalakshmi Bank HDFC bank ICICI Bank Indian Bank Kotak Mahindra Bank State bank of India State Bank of Patiala Syndicate Bank

Waghodia Urban CoopBank Ltd.

Vadnagar NagrikSahakari Bank Limited

Vallabh VidhyanagarCommercial Co opBaShree

Valsad Mahila NagrikSahakari Bank Ltd.

Varachha Co-operativebank Ltd

Vejalpur NagarikSahakari bank Ltd.

Vepar Udhyog VikasSahakari Bank LimitedVeraval MercantileCoop Bank Limited.Veraval Peoples CoopBank Limited.

Vijapur NagrikSahakari Bank Limited.

Vijay CommercialCoop Bank Limited.

Vijay Coop BankLimited. Near -

Viramgam MercantileCoop Bank Limited.

Functions

India Argentina1. The primary role of RBI Regulating theissue of bank notes and preserving reserveto maintain monetary stability of thecountry especially with Indian Rupees.2. It operates currency and credit system ofthe country.3. It Acts as Monetary authority in India.4. It is Regulator and supervisor offinancial system.5. It Manages foreign exchange in country.6. It is Issuer of currency in the country7. It plays Developmental role in theeconomy.

1. The primary role of the bank is to havean influential hold over the country’sexchange rate, especially with the UnitedStates Dollar.2. To avoid massive inflation or deflation

due to the high volume of trade, the bankwill buy other currencies to convert intoArgentinean Dollars.3. To release monthly reports with

macroeconomic effects and any signs ofharmful inflation.4.Central bank is Responsible for the issueof banknotes and coins. Argentinean

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banknotes are distributed in the typicalscale seen in stronger currencies such asthe Euro and the USD, despite the slightlydepreciated value of the Argentinean Peso.

5. It issues bank notes in the country.

6. It manages the foreign exchange and

gold reserves of the country.

7. It decides official interest rate for

managing inflation in the country.

8. Acting as the banker to the Government

and the banker's bank.9. It regulates and supervises the bankingindustry in the economy.1. Accepting deposits from people.2. Giving loans.3. Overdraft4. Discounting of Bills of Exchange5. Investment of Funds6. Agency Functions7. Miscellaneous Functions

Types of Accounts

India Argentina

Demat accountNRE A/cNRO A/C (Ordinary Non-Resident Rupee)FCNR A/cSb a/c -Savings bank accountCC a/c - Cash credit accountCA a/c - Current accountSalary AccountRecurring deposit accountOverdue account - OD a/cFixed deposit accountPropreitorship accountPartnership accountFirm accountCompany account

Current AccountSavings Account

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Branches in Overseas

India Argentina

Punjab National Bank Allahabad Bank State Bank of India Bank of India Bank of Baroda Indian Bank Indian Overseas Bank UCO Bank Canara Bank Syndicate Bank ICICI Bank AXIS Bank

Citibank Bank of New York HSBC

There are many foreign banks operating there system in Argentina such as Citibank andBank of New York have several branches, particularly in Buenos Aires & also HSBC isanother foreign bank that has a lot of branches over there. It will be easier if anyone wishto use a bank from his/her country of origin to open the account before he/she arrives inthe country if his/her own bank is able to take care of that for them. However, they willstill require the same amount of documentation in order to open the account. But there isnot even single bank belonging India.

Indians in Argentina : 1,200 People of Indian Origin400 Non Residential Indians.

Foreign banks are entering in Argentina's domestic banking sector in the mid-1990s didnot merely follow their clients abroad. They exerted competitive pressure on domesticArgentine banks, especially those focused on mortgage lending or manufacturing.Overhead, profitability, and interest margins were affected least in home banks focusedon customers lending, an cluster in which foreign investors showed little interest.Domestic banks with greater consumer lending - an area in which foreign banks have notbeen heavily involved - had higher net margins and greater before - tax profits. Domesticbanks that focused on mortgage lending - an area foreign banks experienced falling netmargins and increasing overhead. There were many domestic bank failures in the mid-1990s, but the banks that failed were not heavily concentrated in the types of lendingfavored by foreign banks.

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List of Representative offices of Indian Banks as on November 30, 2007

Name of Banks Name of CentersAllahabad Bank Shenzen (China)Andhra Bank Dubai, UAEBank of Baroda Guang Zhou (China)Bank of Baroda Malaysia (Kuala Lumpur)Bank of Baroda Thailand (Bangkok)Bank of India Jakarta [Indonesia]Bank of India Ho Chi Minh City [Vietnam]Bank of India China, (Beijing)Canara Bank China (Shanghai)Centurian Bank of Punjab Ltd. Mississauga, Ontario [Canada]HDFC Bank Dubai [UAE]ICICI Bank New York [USA]ICICI Bank Dubai [UAE]ICICI Bank Shanghai [China]ICICI Bank Dhaka (Bangladesh)ICICI Bank Johannesburg (South Africa)ICICI Bank Ltd Bangkok, ThailandICICI Bank Ltd . Kuala Lumpur, MalaysiaICICI Bank Ltd Jakarta, IndonesiaIndian Overseas Bank Guang Zhou (China)Indian Overseas Bank Malaysia (Kuala Lumpur)IndusInd Bank London (UK)IndusInd Bank Ltd Dubai [UAE]Punjab National Bank Almaty [Kazakhstan]Punjab National Bank London [UK]Punjab National Bank Shanghai (China)Punjab National Bank Dubai (UAE)State Bank of India Tehran [Iran]State Bank of India Cairo [Egypt]State Bank of India Washington [USA]State Bank of India Milan [Italy]State Bank of India Manila [Philippines]State Bank of India Luanda (Angola)State Bank of India Turkey, (Istanbul)UCO Bank Malaysia Kuala LumpurUTI Bank Ltd China (Shanghai)UCO Bank China (Guangzhou)Union Bank of India China ShanghaiBank of Baroda Australia, Sydney

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Currency

India rupee Argentine peso United state dollars

11.65 1 0.23

Repo rate

India Argentina Gujarat8.50%(oct-2011) 9%(oct 2009) 8.50%

PolicesIndia Argentina

General or specific permission isnecessary from the RBI for all foreignexchange transactions.

Once if foreign money enter after thatthey are restricted to go out of India

Foreign employees, liaison offices,project offices and branches of foreigncompanies may open and use a residentbank account in Indian currencyprovided that they have approval by theRBI

Exporters who have net foreignexchange earnings of a certain level canmaintain a foreign currency accountoutside of India. The sale of foreignexchange or rupee transfers to non-resident accounts in payment forimports may be made by authorizeddealers. Persons, firms and banks (otherthan authorized banks) must apply to anauthorized dealer on form A1"Application for remittance in foreigncurrency" to pay for imported goods. Incertain cases, additional questionnaireforms or supporting letters may berequired along with form A1.

he rupee was made fully convertible on

economic situation a monetary policycan be expansionary or contractionary.

An expansionary monetary policy aimsto expand the money supply in order tocombat recession and unemployment.

In contrast the goal of a contractionarymonetary policy is to decrease themoney supply, in order to fightinflationary pressures.

The BCRA continues to intervene in theexchange market, usually buying dollars,though occasionally selling smallamounts .

Argentina offered a favorable climate forforeign investment and the basicdevelopment of the nation'stransportation system and shippingfacilities was financed with Britishcapital.

2001–02, the Argentina economy wentthrough the worst implosion in itshistory, much of it connected with thegovernment's effort to attract foreigninvestment.

argentina's borrowing costs and exportprices uncompetitive, and then from2001, when the dollar tie served a

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Currency


11.65 1 0.23

Repo rate















31

Currency


11.65 1 0.23

Repo rate















32

the current account. Rupeeconvertibility on the trade account isrestricted by the negative list of importsand exports and limited to thoseinvolved in trade

All export and import transactions areconducted at the market rate ofexchange. This applies as well to othertransactions, such as inflow of foreignequity for investment, outflows in thecase of disinvestment, payments inrespect of repatriation of dividends,fees and royalties for technical know-how and for foreign travel.

means of importing the US recessioninto Argentina's already contracting andheavily indebted economy.

Although Argentina remains a netrecipient of FDI, Argentinean firmshave recently begun making substantialoutward investments regionally, inBrazil, Paraguay, and Uruguay.

Trade barriers

India Argentina

The U.S. goods trade deficit with India was$7.1 billion in 2008, an increase of $611million from $6.5billion in 2007. U.S. goods exports in 2008were $18.7 billion, up 6.1 percent from theprevious year.Corresponding U.S. imports from Indiawere $25.8 billion, up by 7.0 percent. Indiais currently the 17th largest export marketfor U.S. goods.

The stock of U.S. foreign direct investment(FDI) in India was $13.6 billion in 2007(latest dataavailable), up from $9.2 billion in 2006.U.S. FDI in India is concentrated largely inthe information,

manufacturing, and banking sectors

The U.S. goods trade surplus withArgentina was $1.7 billion in 2008, anincrease of $348 million from$1.4 billion in 2007. U.S. goods exports in2008 were $7.5 billion, up 28.7 percentfrom the previousyear. Corresponding U.S. imports fromArgentina were $5.8 billion, up 29.7percent. Argentina iscurrently the 32nd largest export market forU.S. goods. The stock of U.S. foreign directinvestment (FDI) in Argentina was $14.9billion in 2007 (latest dataavailable), up from $13.9 billion in 2006.U.S. FDI in Argentina is concentratedlargely in the nonbankholding companies, mining, andmanufacturing sectors.

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ExportsIndia Argentina

Exporting - 25347 Million USD(January,2012.)

Gems and jewelry is the largest exportingitem which accounting for 16 % ofexports.

India is also lead in export of textile goods,engineering goods, chemicals, leathermanufactures and services. India’s main export partners European Union United States United Arab Emirates China

Exporting - 5909 Million USD(January,2012.)

Growth in foreign trade has been one of themain factors driving the Argentine economy.

Mainly export the agricultural type, mostlyprocessed goods (54% of the total).i.g ofsome main export items soybean products,cereals, beef, motor vehicles and parts,chemicals and medicine. Argentine’s main export markets Brazil European Union China United Sates Chile

GDP

India Argetina

6.9% (2011-2012) 6%(2011-2012)

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ImportsIndia Argentina

Imports - 40108 Million USD (January-2012.)

India is poor in oil resources and iscurrently heavily dependent on coal andforeign oil imports for its energy needs.

Other imported products are: machinery,gems, fertilizers and chemicals.

Main import partners European Union Saudi Arabia United States

Imports- 5358 Million USD (January –2012)

Growth in foreign trade, especially tradewith MERCOSUR partners, has been one ofthe main factors driving the Argentineaneconomy.

Argentina is a major importer of industrialand computing machinery and parts,industrial supplies, automobiles and otherconsumer durables, refined fuels andlubricants.

Main import partner Brazil, European Union, United States China

Interest Rate

India Argentina

The benchmark interest rate (reverse repo) inIndia was last reported at 7.5 percent theofficial interest rate is the benchmarkrepurchase rate.

From 2000 until 2010, India's averageinterest rate was 5.82 percent reaching anhistorical high of 14.50 percent in August of2000 and a record low of 3.25 percent inApril of 2009

The benchmark interest rate in Argentinawas last reported at 9 percent. InArgentina, interest rate decisions are takenby The Central Bank of Argentina (BancoCentral de la República Argentina,BCRA).

From 1995 until 2010, Argentina's averageinterest rate was 9.77 percent reaching anhistorical high of 125.00 percent in Augustof 2002 and a record low of 0.95 percent inApril of 2004. This page includes:Argentina Interest Rate chart, historicaldata and news.

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Monetary value

India Argentina

India has the 4th highest amount offoreign exchange reserves in the world,amounting around $297 Billion.

A lot of regulation in regards todomestic banks include:• strengthening of the role of statutoryauditors• introduction of off-site surveillance• strengthening of the internal defensesof supervised institutions.• restructuring of the system of bankinspections

The primary role of the bank is to have aninfluential hold over the country’s exchangerate, especially with the United States Dollar.

Argentina’s financial infrastructure runs insuch a way that foreign currency trade ishighly encouraged, perhaps inadvertently;this is mainly because the currency has beenslowly increasing in value since the 1980s.

To avoid massive inflation or deflation dueto the high volume of trade, the bank willbuy other currencies to convert intoArgentinean Dollars.

In fact, inflation has been a very traditionalissue, and the bank is required by law torelease monthly reports with macroeconomiceffects and any signs of harmful inflation.

Currency

India Argentina

Reserve bank is the official issuer ofRupee currency in India.

RBI is also responsible for makingavailable an adequate supply of goodquality currency to the public as well astaking in and destroying coins or notesthat are not up to standards due to age orwear.

The following are in frequent use: 10,20, 50, 100, 500, 1000 rupee bank notesand 5, 10, 20, 25, 50 Paisa coins in asubdivision of 100.

Currency used in Argentina is the peso($).

Paper money is available in values of 2,5,10,20,50 and 100 pesos.

One peso equals 100 centavos and coinsare available in values of 1, 5, 10, 25 and50 centavos and one peso.

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Income TaxIndia Argentina

Personal tax rates in India are progressive up to30%, plus the applicable cess of 3 % (2% forPrimary Education Cess and 1% for SecondaryEducation Cess). Year (2012-2013)

For resident men below the age of 65 yrs:

Income Tax ratesUp to 160,000 Nil160,001 - 300,000 10%300,001 - 500,000 Rs 14,000 plus 20%Above 500,000 Rs 54,000 plus 30%

For resident women below the age of 65 years:


For senior citizens (men or women who are 65years or more at any time during the PreviousYear)


India company tax is levied as follows:

Domestic companies 33.99%Foreign companies 42.23%

The standard VAT rate in India is 12.5%, withlower rates of 4% and 1%, except in some stateswhere certain higher rates have been prescribed.A refund of input tax is available for exporters.

In Argentina, 2 types of taxes are currentlylevied on individual (calendar year):

1) Personal Income Tax2) Personal Assets Tax (Wealth Tax)

1) Argentina Income Tax Rates

Argentina residents are liable to a progressivetax on their worldwide income ranging between9% - 35%. There are 7 income tax scales:

Taxable Income (ARS) / Tax Rate %

ARS 0 to 10,000 9%ARS 10,001 to 20,000 14%ARS 20,001 to 30,000 19%ARS 30,001 to 60,000 23%ARS 60,001 to 90,000 27%ARS 90,001 to 120,000 31%ARS 120,001 and above 35%

Non-Taxable income is ARS 10,800 / year

2)Argentina Personal Assets Tax (Wealth Tax)Argentina Personal Assets Tax (Wealth Tax) islevied on:- all assets located in Argentina or in foreigncountries that belong to individuals resident inArgentina- all assets located in Argentina that belong toindividuals resident in foreign countries- shares issued by Argentine companies. In thiscase, the company pays the tax on behalf of theshareholders.

Argentina.

The standard rate of Value Added Tax inArgentina is 21%.

Argentina corporate income tax rate is 35%.

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Foreign Direct Investment

India Argentina

During 2000–10, the country attracted$178 billion as FDI.

India's recently liberalized FDI policy (2005)allows up to a 100% FDI stake in ventures.

In March 2005, the government amended therules to allow 100% FDI in the constructionsector, including built-up infrastructure andconstruction development projectscomprising housing, commercial premises,hospitals, educational institutions,recreational facilities, and city- and regional-level infrastructure.

The total FDI equity inflow into India in2008–09 stood at 122,919 crore (US$24.52billion), a growth of 25% in rupee terms overthe previous period.

Foreign direct investment in Argentina isdivided nearly evenly between manufacturing(36%), natural resources (34%), and services(30%). The chemical and plastics sector(10%) and the automotive sector (6%) leadforeign investment in local manufacturing;oil and gas (22%) and mining (5%), innatural resources; telecommunications (6%),finance (5%), and retail trade (4%), inservices.

(NRI Investment)

37


India Argentina






(NRI Investment)

37


India Argentina






(NRI Investment)

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Few similar problems

India Argentina have stubborn fiscal deficit. have problems getting the tax/GDP

ratio beyond 15-20%.

Fiscal problems of (provincial) stategovernments.

have problems with a frameworkof labor law that stifles the labormarket.

low trade-GDP ratio.

have stubborn fiscal deficit. have problems getting the tax/GDP

ratio beyond 15-20%.

Fiscal problems of (provincial) stategovernments.

Both countries have problems witha framework of labor law thatstifles the labor market.

have a low trade-GDP ratio.

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Economic Sector of Argentina

Introduction Of Economy Of Argentina:

Argentina has a market-oriented economy with a lot of natural resources, a well-educated population, an export-oriented agricultural sector and a relatively diversifiedindustrial basic exposure.

The nation's services sector accounts for around 59% of the economy and 72% ofemployment, manufacturing is 21% of GDP and 13% of employment, and agriculture is9% of GDP, with 7% of employment; construction, mining, and public utilities divide therest. Agriculture, including processed goods, provided 54% of export earnings in 2010,however, while industrial manufactures accounted for 35% (energy staples and metal oreswere most of the remainder).

High inflation has been a drawback of the Argentine economy for decades. Officiallyspreading around 9% since 2006, inflation has been privately estimated at over20%,becoming a contentious issue again. The urban income poverty rate has dropped to18% as of mid-2008, a third of the peak level observed in 2002, though still above thelevel prior to 1976.Income distribution, having improved since 2002, is still considerablyunequal.

Argentina ranks 105th out of 178 countries in the Transparency International's CorruptionPerceptions Index for 2010. Reported problems include both government and private-sector corruption, the latter of which include money laundering, trafficking in narcoticsand contraband, and tax evasion. The Kirchner administration with a record public-worksprogram, new tax cuts and subsidies,and the transfer of private pensions to the socialsecurity system. Private pension plans, which required growing subsidies to cover, werenationalized to shed a budgetary drain as well as to finance high government spendingand debt obligations.

Argentina has, after its neighbour river Chile, the second-highest Human DevelopmentIndex, and the highest GDP per capita in purchasing power terms in Latin America.Argentina is one of the G-20 major economies, with the world's 27th largest nominalGDP, and the 22nd largest by purchasing power. The country is classified as upper-middle income or a secondary emerging market by the World Bank.

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ECONOMIC HISTORY OF ARGENTINA:

The economic history of Argentina is one of the most researched, owing to the"Argentine paradox", its unique condition as a country which had achieved advanceddevelopment in the early 20th century but experienced a drawback, which inspired awealth of literature and analyses on the causes of its decline.

Argentina possesses definite comparative advantages in agriculture, as the country isinvolved with a vast amount of highly fertile land. Before the arrival of Spanishexplorers, present-day Argentina was populated by Indigenous peoples. Those nativeswere still hunter-gatherer societies, so there was no economic system in their societies.Between 1860 and 1930, exploitation of the rich land of the pampas strongly pushedeconomic growth. During the first 3 decades of the 20th century, Argentina outgrewCanada and Australia in population, total income, and per capita income. By 1913,Argentina was the world's 10th wealthiest nation per capita.

Beginning in the 1930s, however, the Argentine economy diminished notably.The singlemost important factor in this decline has been political instability since 1930, when amilitary junta took power, ending seven decades of civilian constitutional government. Inmacroeconomic terms, Argentina was one of the most stable and conservative countriesuntil the Great Depression, after which it tuned into one of the most unstable. Successivegovernments from the 1930s to the 1970s pursued a strategy of import substitution toachieve industrial self-sufficiency, but the government's encouragement of industrialgrowth diverted investment from agricultural production, which fell dramatically.

The era of import trades and its use ended in 1976, but the same time growinggovernment spending, large wage raises and inefficient production created a chronicinflation that rose through the 1980s.The measures enacted in 1976 also produced a hugeforeign debt by the late 1980s, which became equivalent to three-fourths of the GNP.

In the early 1990s the government reined in inflation by making the peso equal in valueto the U.S. dollar, and privatized numerous state-run companies, using part of theproceeds to reduce the national debt. However, a sustained recession at the turn of the21st century culminated in a default, and the government again devalued the peso.therewas considerable GNP growth, renewed foreign investment, and a significant drop in theunemployment rate.

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Structure & Business Activity of Argentina:

*Working practices in Argentina:

Business hours are normally from 9am - 7pm Monday to Friday. It is not uncommonhowever for businesses to remain open until 9 - 10 pm. Business lunch hours varybut are normally between 1 - 3pm. Business dinner events usually begin late eveningaround 10pm.

Argentina people have a much more flexible attitude towards time. Therefore, do notbesurprised if business meetings or social events begin late.

*Structure and hierarchy in companies of argentina: Business organizations in Argentina tend to be systematic. Decisions and ideas are

generated at the top. Status is important in Argentinian society and respect should begiven to supervisors and work colleagues.

As Argentinian society is very status conscious, it is important to address colleagueswith the proper title followed by only his or her father’s surname, unless invited todo so otherwise.

Many Argentinian women are well educated and more are entering the workforce.However, women tend to leave the workforce upon having children, but a commonpractice with many Argentinian women is to hire a nanny so that they may return towork.

*Working relationships in Argentina:

Business relationships in Argentina are based on trust and familiarity. Personalcontacts and networks are important in making business deals. developing

friendships will improve your success in the business world in Argentina.

Argentinians prefer to mix their private and professional lives together. They may behesitant to trust people at first so it is important to take the time to developinterpersonal relationships with your Argentinian counterparts before conductingbusiness.

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*Business practices:

Business in Argentina is conducted entirely in Spanish. Most Argentinians do have aworking knowledge of English, but it is wise, however, to bring an interpreter tomeetings if you do not have a proficient knowledge of Spanish.

Negotiations can be quite continued as Argentinians are very detail-oriented and wantto examine everything thoroughly before reaching an agreement. Although generallyvery informal, they rely on a clear, work-related structure and value rules and

procedures.

Initial introductions in Argentinian business are informal. A handshake whilemaintaining strong eye contact is the normal greeting and should also be exchangedupon leaving. Once a relationship has developed into friendship, a kiss on the cheekor the handshake.

Economy of India

The Economy of India is the 11th largest in the world by nominal GDP and the thirdlargest by purchasing power parity (PPP). The country is one of the G-20 majoreconomies and a member of BRICS. In 2011, the country's per capita income stood at$3,694 IMF, 129th in the world, thus making a lower-middle income economy.

After the independence Indian economy (before and a little after 1947) was inspired bythe Soviet model of economic development, with a large public sector, high import dutiescombined with interventionist policies, leading to massive inefficiencies and widespreadcorruption. However, later on India adopted free market principles and liberalized itseconomy to international trade under the guidance of Manmohan Singh, who then wasthe Finance Minister of India under the leadership of P.V.Narasimha Rao the then PrimeMinister. Following these strong economic reforms, the country's economic growthprogressed at a rapid pace with very high rates of growth and large increases in theincomes of people.

India recorded the highest growth rates in the mid-2000s, and is one of the fastest-growing economies in the world. The growth was led primarily due to a huge increase inthe size of the middle class consumer, a large labour force and considerable foreigninvestments. India is the nineteenth largest exporter and tenth largest importer in theworld. Economic growth rates are projected at around 7% for the 2011-12 fiscal year.

43

ECONOMIC SECTORS OF INDIA:

(a)Industry and services

Industry accounts for 28% of the GDP and employ 14% of the total workforce. Inabsolute terms, India is 12th in the world in terms of nominal factory output. The Indianindustrial sector underwent significant changes as a result of the economic reforms of1991, which removed import restrictions, brought in foreign competition, led toprivatisation of certain public sector industries, liberalised the FDI regime, improvedinfrastructure and led to an expansion in the production of fast moving consumer goods.Post-liberalisation, the Indian private sector was faced with increasing domestic as wellas foreign competition, including the threat of cheaper Chinese imports. It has sincehandled the change by squeezing costs, revamping management, and relying on cheaplabour and new technology. However, this has also reduced employment generation evenby smaller manufacturers who earlier relied on relatively labour-intensive processes.

Textile manufacturing is the second largest source of employment after agriculture andaccounts for 20% of manufacturing output, providing employment to over 20 millionpeople. As stated in late January, by the then Minister of Textiles, India, Shri ShankersinhVaghela, the transformation of the textile industry from a degrading to rapidly developingindustry, has become the biggest achievement of the central government. After freeingthe industry in 2004–2005 from a number of limitations, primarily financial, thegovernment gave the green light to the flow of massive investment – both domestic andforeign. During the period from 2004 to 2008, total investment amounted to 27 billiondollars. By 2012, still convinced of the government, this figure will reach 38 billion asexpected; these investments in 2012 will create an additional sector of more than 17million jobs. But demand for Indian textiles in world markets continues to fall. Accordingto Union Minister for Commerce and Industries Kamal Nath, only during 2008–2009fiscal year (which ends 31 March) textile and clothing industry will be forced to cut about800 thousand new jobs – nearly half of the rate of two million, which will have to go allthe export-oriented sectors of Indian economy to soften the impact of the global crisis.Ludhiana produces 90% of woollens in India and is known as the Manchester of India.Tirupur has gained universal recognition as the leading source of hosiery, knittedgarments, casual wear and sportswear.

India is 13th in services output. The services sector provides employment to 23% of thework force and is growing quickly, with a growth rate of 7.5% in 1991–2000, up from4.5% in 1951–80. It has the largest share in the GDP, accounting for 55% in 2007, upfrom 15% in 1950. Information technology and business process outsourcing are amongthe fastest growing sectors, having a cumulative growth rate of revenue 33.6% between1997–98 and 2002–03 and contributing to 25% of the country's total exports in 2007–08.The growth in the IT sector is attributed to increased specialisation, and an availability ofa large pool of low cost, highly skilled, educated and fluent English-speaking workers, onthe supply side, matched on the demand side by increased demand from foreignconsumers interested in India's service exports, or those looking to outsource their

44

operations. The share of the Indian IT industry in the country's GDP increased from4.8 % in 2005–06 to 7% in 2008.[70] In 2009, seven Indian firms were listed among thetop 15 technology outsourcing companies in the world.

Mining forms an important segment of the Indian economy, with the country producing79 different minerals (excluding fuel and atomic resources) in 2009–10, including ironore, manganese, mica, bauxite, chromite, limestone, asbestos, fluorite, gypsum, ochre,phosphorite and silica sand. Organised retail supermarkets accounts for 24% of themarket as of 2008. Regulations prevent most foreign investment in retailing. Moreover,over thirty regulations such as "signboard licences" and "anti-hoarding measures" mayhave to be complied before a store can open doors. There are taxes for moving goodsfrom state to state, and even within states. Tourism in India is relatively undeveloped, butgrowing at double digits. Some hospitals woo medical tourism.

(b)Agriculture

India ranks second worldwide in farming. Agriculture and allied sectors like forestry,logging and fishing accounted for 15.7% of the GDP in 2009–10, employed 52.1% of thetotal workforce, and despite a steady decline of its share in the GDP, is still the largesteconomic sector and a significant piece of the overall socio-economic development ofIndia.. Yields per unit area of all crops have grown since 1950, due to the specialemphasis placed on agriculture in the five-year plans and steady improvements inirrigation, technology, application of modern agricultural practices and provision ofagricultural credit and subsidies since the Green Revolution in India. However,international comparisons reveal the average yield in India is generally 30% to 50% ofthe highest average yield in the world. Indian states Uttar Pradesh, Punjab, Haryana,Madhya Pradesh, Andhra Pradesh, Bihar, West Bengal and Maharashtra are keyagricultural contributing states of India.

India receives an average annual rainfall of 1,208 millimetres (47.6 in) and a total annualprecipitation of 4000 billion cubic metres, with the total utilisable water resources,including surface and groundwater, amounting to 1123 billion cubic metres. 546,820square kilometres (211,130 sq mi) of the land area, or about 39% of the total cultivatedarea, is irrigated. India's inland water resources including rivers, canals, ponds and lakesand marine resources comprising the east and west coasts of the Indian ocean and othergulfs and bays provide employment to nearly six million people in the fisheries sector. In2008, India had the world's third largest fishing industry.

India is the largest producer in the world of milk, jute and pulses, and also has the world'ssecond largest cattle population with 175 million animals in 2008. It is the second largestproducer of rice, wheat, sugarcane, cotton and groundnuts, as well as the second largestfruit and vegetable producer, accounting for 10.9% and 8.6% of the world fruit andvegetable production respectively. India is also the second largest producer and thelargest consumer of silk in the world, producing 77,000 million tons in 2005.

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(c)Banking and finance:

The Indian money market is classified into the organised sector, comprising private,public and foreign owned commercial banks and cooperative banks, together known asscheduled banks, and the unorganised sector, which includes individual or family ownedindigenous bankers or money lenders and non-banking financial companies. Theunorganised sector and microcredit are still preferred over traditional banks in rural andsub-urban areas, especially for non-productive purposes, like ceremonies and shortduration loans.

Prime Minister Indira Gandhi nationalised 14 banks in 1969, followed by six others in1980, and made it mandatory for banks to provide 40% of their net credit to prioritysectors like agriculture, small-scale industry, retail trade, small businesses, etc. to ensurethat the banks fulfill their social and developmental goals. Since then, the number of bankbranches has increased from 8,260 in 1969 to 72,170 in 2007 and the population coveredby a branch decreased from 63,800 to 15,000 during the same period. The total bankdeposits increased from 5,910 crore (US$1.18 billion) in 1970–71 to 3,830,922 crore(US$764.27 billion) in 2008–09. Despite an increase of rural branches, from 1,860 or22% of the total number of branches in 1969 to 30,590 or 42% in 2007, only 32,270 outof 500,000 villages are covered by a scheduled bank.

India's gross domestic saving in 2006–07 as a percentage of GDP stood at a high32.7%.More than half of personal savings are invested in physical assets such as land,houses, cattle, and gold. The public sector banks hold over 75% of total assets of thebanking industry, with the private and foreign banks holding 18.2% and 6.5%respectively. Since liberalisation, the government has approved significant bankingreforms. While some of these relate to nationalised banks, like encouraging mergers,reducing government interference and increasing profitability and competitiveness, otherreforms have opened up the banking and insurance sectors to private and foreign players.

(d)Energy and power:

As of 2009, India is the fourth largest producer of electricity and oil products and thefourth largest importer of coal and crude-oil in the world.[91] Coal and oil togetheraccount for 66 % of the energy consumption of India.[92]

India's oil reserves meet 25% of the country's domestic oil demand. As of 2009, India'stotal proven oil reserves stood at 775 million metric tonnes while gas reserves stood at1074 billion cubic metres. Oil and natural gas fields are located offshore at MumbaiHigh, Krishna Godavari Basin and the Cauvery Delta, and onshore mainly in the states ofAssam, Gujarat and Rajasthan. India is the fourth largest consumer of oil in the world andimported $82.1 billion worth of oil in the first three quarters of 2010, which had anadverse effect on its current account deficit. The petroleum industry in India mostlyconsists of public sector companies such as Oil and Natural Gas Corporation (ONGC),

45








45








46

Hindustan Petroleum Corporation Limited (HPCL) and Indian Oil Corporation Limited(IOCL). There are some major private Indian companies in the oil sector such as RelianceIndustries Limited (RIL) which operates the world's largest oil refining complex.

As of December 2011, India had an installed power generation capacity of 185.5 GigaWatts(GW), of which thermal power contributed 65.87%, hydroelectricity 20.75%, othersources of renewable energy 10.80%, and nuclear power 2.56%.. India meets most of itsdomestic energy demand through its 106 billion tonnes of coal reserves. India is also richin certain renewable sources of energy with significant future potential such as solar,wind and biofuels (jatropha, sugarcane). India's huge thorium reserves – about 25% ofworld's reserves – are expected to fuel the country's ambitious nuclear energy program inthe long-run. India's dwindling uranium reserves stagnated the growth of nuclear energyin the country for many years. However, the Indo-US nuclear deal has paved the way forIndia to import uranium from other countries.

(e)Infrastructure:

India has the world's third largest road network, covering more than 4.3 millionkilometers and carrying 60% of freight and 87% of passenger traffic. Indian Railways isthe fourth largest rail network in the world, with a track length of 114,500 kilometers.India has 13 major ports, handling a cargo volume of 850 million tonnes in 2010.

India has a national rate of 74.15% with 926.53 million telephone subscribers, two-thirdsof them in urban areas, but Internet use is rare, with around 13.3 million broadband linesin India in December 2011. However, this is growing and is expected to boom followingthe expansion of 3G and wimax services.

47

(6)Comparision of Argentina & India:

Country

Argentina India

Leader

President: Cristina Fernandez President: Pratibha Patil

Population

41,769,726 1,189,172,906

Life Expectancy

76.950 years 66.800 years

Capital City

Buenos Aires New Delhi

Largest city

Buenos Aires (population:13,076,300)

Mumbai (population:12,691,800)

Human Development Index

0.86 0.609

GDP per capita

$14,700 US $3,500 US

Literacy Rate

97.2% 61%

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Country

Argentina India

Leader


Population

41,769,726 1,189,172,906

Life Expectancy


Capital City


Largest city




0.86 0.609

GDP per capita

$14,700 US $3,500 US

Literacy Rate

97.2% 61%

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Country

Argentina India

Leader


Population

41,769,726 1,189,172,906

Life Expectancy


Capital City


Largest city




0.86 0.609

GDP per capita

$14,700 US $3,500 US

Literacy Rate

97.2% 61%

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Corruption Perception Index

2.9 3.4

Percentage of Women in Parliament

39.8% 9.2%

Wealthiest Citizens

Gregorio Perez Companc &family ($1.8bn US)

Mukesh Ambani ($19.5bn US)

Unemployment Rate

7.900% 10.800%

Death Penalty

Abolished Legal

Political System

republic federal republic

Independence date

9 July 1816 (from Spain) 15 August 1947 (from UK)

Religions

nominally Roman Catholic92% (less than 20%practicing), Protestant 2%,Jewish 2%, other 4%

Hindu 80.5%, Muslim 13.4%,Christian 2.3%, Sikh 1.9%, other1.8%, unspecified 0.1% (2001census)

Languages

Spanish (official), Italian,English, German, French

Hindi 41%, Bengali 8.1%,Telugu 7.2%, Marathi 7%, Tamil5.9%, Urdu 5%, Gujarati 4.5%,Kannada 3.7%, Malayalam3.2%, Oriya 3.2%, Punjabi 2.8%,Assamese 1.3%, Maithili 1.2%,other 5.9%

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Exports

soybeans and derivatives,petroleum and gas, vehicles,corn, wheat

petroleum products, textilegoods, gems and jewelry,engineering goods, chemicals,leather manufactures

External Debt

$128,000,000,000 $ $238,000,000,000 US

Exchange Rate

Argentine pesos (ARS) perUS dollar - 3.1636 (2008est.), 3.1105 (2007), 3.0543(2006), 2.9037 (2005),2.9233 (2004)

Indian rupees (INR) per USdollar - 43.319 (2008 est.),41.487 (2007), 45.3 (2006),44.101 (2005), 45.317 (2004)

Military Budget as percentage of GDP

0.800% 2.500%

Beijing Olympics Medal Count

6 3

Location

Southern South America,bordering the South AtlanticOcean, between Chile andUruguay

Southern Asia, bordering theArabian Sea and the Bay ofBengal, between Burma andPakistan

Area

2,780,400 km sq 3,287,263 km sq

Coastline

4,989 km 7,000 km

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(7) India and Argentina export import:

(source: http://www.indembarg.org.ar/en/gbvar_guide.htm)

(USD in million)


Exports from India to Argentina (2011)


Imports of India from Argentina (2011)

Items In million US $

Argentina

2010 2009



2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000India’sexports

560 496 342 492 384 303 261 160 136 85 151 143

India’simports

1214 2032 876 836 859 929 739 567 558 404 446 442

Items In million US $Organic chemicals 155Vehicles and autoparts 68Lubricants 38Machinery 36Sound and image divices 35Synthetic Fibers 24Garments 21Plastic products 19Dyes 15Iron and steel 14

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Soybean oil 1070Sunflower oil 42Leather 32Wool 9Ferroalloys 9Valves 7Air pumps and compressors 6Cosmetics 5Precision instruments 4Corn 4(source: http://www.indembarg.org.ar/en/gbvar_guide.htm)

Major Argentine edible oil exporters to India

Cargil Molinos Rio de la Plata Vicentin Luis Dreyfus AGD Bunge

(8) Export Import policies of Argentina:

(a)Exports:

Indian exporters are invited to explore the potential for exports to Argentina. There isscope for increasing the volume of items already exported as well as for new items. Theseare: vehicles, two-wheelers, auto parts, machinery including for sugar industry andrailways, solar and wind energy, chemicals, inputs for agriculture, agrochemicals, bulkdrugs, dyestuff, textiles and handicrafts.Indian brands have started making their mark in Argentina.

Mahindra Tractors and Royal Enfield Motorcycles were launched in Argentine market inMarch 2009. Bajaj motor cycles are sold in Argentina.

(b)Imports:

India’s imports of soy and sunflower oil as well as copper are expected to increasesteadily in the years to come. Wheat would be an import item as and when there is

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shortfall in Indian production. Argentine companies have been supplying CNG kits toIndia, wine, wool, leather, olives and dried vegetables and fruits.

Argentina has the potential for contributing to India’s food security in future. At present,Argentina is a major source of edible oils for India. According to the Solvent ExtractorsAssociation of India (SEA), the requirement of edible oils in 2006 was 12 million tons ofwhich 7 million were produced domestically and 5 million was imported. Imports shot upto over 7 million tons in 2009. In 2010, the requirement of edible oils is expected toincrease to 15 million tons and more in the years to come. But the production of oilseedsin India cannot match the demand and India will continue to be a long term importer ofedible oils. In this respect, India can count on Argentina as a reliable source. Argentina isthe world’s largest exporter of soya oil and sunflower oil. Argentina has the third largestcapacity for edible oil processing after China and USA.

India has imported wheat from Argentina from time to time, including purchase of 44million dollars in 2008. Besides edible oil and wheat, Argentina can be a new source ofpulses. India imports about 3 million tons of pulses from countries such as Myanmar,Australia, Turkey and Canada. Although. India does not import any pulses fromArgentina at present, the Argentine soil is suitable for cultivation of pulses of interest toIndia. The Argentine agribusiness companies are willing to grow these, attracted by thelarge and growing market in India.

India is going to be under more pressure for agricultural land in future. India´spopulation increases by 15 million every year and it adds a new Argentina (40 million)every 32 months. On the other hand, agricultural land is diminishing because of theincreasing use for residential, industrial and commercial purposes. This is in contrast withArgentina which has a small population of 40 million with an area almost equal to that ofIndia. Besides the large area, the Argentine productivity of grains and oilseeds are threetimes that of India.

In India, the subsistence farmers with their average land holding of just a few acres areunable to invest and increase productivity significantly. But the Argentine farmers whohold thousands of hectares of land do farming commercially and professionally and areable to invest in innovation and productivity.

Argentina can also contribute, to a small extent, to India´s energy security. Argentine oilresources are under-explored. They have 2 billion barrels of discovered reserves and arecurrently producing 800,000 bpd. They are just starting off-shore exploration and the landarea has not been fully explored. Indian oil companies in public and private sector couldmake entry here. Reliance has formed a joint venture with an Argentine private companyPluspetrol (along with an Australian company Woodside) and their consortium has wonconcessions in Peru and Bolivia for oil and gas exploration. They are also exploringopportunities in Argentina and in other countries of the region. ONGC Videsh Ltd.(OVL) has signed an MOU with their Argentine counterpart ENARSA and jointly seekopportunities in Argentina and in this region.

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Argentina is the third largest exporter of bio-diesel in the world. They exported over 1.5million tons in 2011 and are increasing production capacity to 3.5 million tons by 2012.India can also consider imports from Argentina.

There are thousands of hectares of land available in the warmer northern parts ofArgentina where jatropha can be grown and used to produce bio-diesel. The Indiancompanies can also invest in commercial forestry in Argentina to take back to India woodand paper pulps which are imported by India regularly.

(c)Argentine Companies in India:

*Techint, the 18 billion dollar Argentine Group (steel, energy, engineering) has an officein Thane employing 200 Indian engineers for their projects in Middle East, Asia andEurope.

*IMPSA, the Argentine engineering company, specializing in hydroelectric projects, hasopened an office in Gurgaon. They are exploring opportunities for projects as well assupply of power generation equipments such as turbines. They have a manufacturing unitin Malaysia.

*Biosidus, an Argentine pharma company, has a proposal to set up a plant in India forproduction of biotech pharmaceuticals for Indian and Asian markets. They are alreadyexporting over 3 million dollars a year to India.

*Bago, the leading Argentine pharma company has an office in Hyderabad for sourcingof bulk drugs run by Vikram Beri. They have a joint venture opeartion with Ranbaxy tomarket their products in Thailand.Some Argentine companies have shown interest in investments and joint ventures inIndia in food processing and autoparts.

*Entertainment business:

Illusion Studios of Buenos Aires in collaboration with Toonz Animation Ltd ofTrivandrum produced a cartoon film ¨Gaturro¨ which was a box office hit in Argentina in2010.The Argentine musician, Gustavo Santaolalla composed music for the Amir Khan film¨Dhobi Ghat¨ which was released in January 2011. The Director of the film Kiran Rao isvisiting Argentina in March 2011 for the Argentine screenings.An Argentine director Pablo Cesar is working on a coproduction film ¨Thinking of Him¨based on the romantic story of Tagore´s encounter with Victoria O´Campo in BuenosAires. He is looking for an Indian producer.

(d)Indian companies in Argentina:

1) TCS2) Cognizant

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3) Action Line (Aegis Group)4) CRISIL / IREVNA5) Copal Partners6) CELLENT7) GLOBAL SOURCING

(9)Export Import policies of India:

IMPORT POLICIES:

The following items can be freely imported into the country by travellers from Bolivia,Brazil, Chile, Paraguay or Uruguay or by residents returning to Argentina after more thana year away.• 1 litre of alcoholic beverages;• 200 cigarettes and• 25 cigars;• 2 k food productsTravellers entering Argentina from other countries than the ones mentioned above canimport the following.• 2 litres of alcoholic beverages;• 400 cigarettes and 50 cigars;• 5 kgs food.

Prohibited:• Illegal drugs• Weapons and ammunition – permission required• Explosives• Knives and deadly weapons• Meat or meat products from any animal species i.e. sausages, cold cuts, ham• Milk and dairy products• Fresh fruit and vegetables• Trees, plants and plant products• New Computers• Colour and new TV’s• Soil• Counterfeit money and goods• Pornographic material

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Restricted• Firearms and ammunition being imported into the country will require authorization bythe Registro Nacional de Armas (RENAR) (National Firearms Bureau). The applicationwill need to be supported by the appropriate firearms certificate of the country ofresidence and will need to be declared at the customs department. An additional ARS 200fee per firearm will likely have to be paid at this point.• Dogs and cats require an official veterinary health and vaccination certificate to bepresented by the owner on arrival. However, pets less than three months of age do notrequire a rabies vaccination certificate.• Mobile phones being imported into the country will need permission from the customsdepartment before being granted entry

Export Policies:

Prohibited:• Illegal drugs• Weapons and ammunition – permission required• Explosives• Knives and deadly weapons• Meat or meat products from any animal species i.e. sausages, cold cuts, ham• Milk and dairy products• Fresh fruit and vegetables• Trees, plants and plant products• New Computers• Colour and new TV’s• Soil• Counterfeit money and goods• Pornographic material

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TRANSPORTATION SECTOR OF ARGENTINA

MODES OF TRANSPORTATION IN ARGENTINA

The following are the various modes at Argentina:

Road Transport

Bus

Taxi

Commuter rail

Metro

Tram

Rail Transport

Long-distance passenger service

High-speed rail

Freight service

Tourist railways

3) Air Transport

4) Merchant Marine

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Road Transport:

Since Argentina is almost 4,000 kilometres long and more than 1,000 km wide, long

distance transportation is of great importance. Several toll expressways spread out from

Buenos Aires, serving nearly half the nation's population. The majority of Argentine

roads, however, are two-lane national and provincial routes and, though they are spread

throughout the country, less than a third of Argentina's 230,000 km (145,000 mi) of roads

are currently paved.

Expressways have been recently doubled in length (to nearly) and now link most (though

not all) important cities. The most important of these is probably the Panamerican

National Route 9 Buenos Aires–Rosario–Córdoba freeway. The longest continuous

highways are National Route 40, a 5000-km stretch along the Andes range and the 3000-

km sea-side trunk road National Route 3, running from Buenos Aires to Ushuaia.

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Statistics:

Total: 230,137 km (2007) - country comparison to the world: 23

Paved: 72,047 km (including 1,575 km of expressways)

Unpaved: 158,090 km

Total 230,137 km (2007)

country comparison to the world 23

Paved 72,047 km (including 1,575 km ofexpressways)

Unpaved 158,090 km

Bus:

The Colectivo (urban bus) cover the

cities with numerous lines. Fares might be fixed for the whole city, or they might depend

on the destination. Colectivos often cross municipal borders into the corresponding

metropolitan areas. In some cases there are diferenciales (special services) which are

faster, air-conditioned versions, and notably more expensive. Bus lines in a given city

might be run by different private companies and/or by the municipal state, and they might

be painted in different colours for easier identification. The quality of the service varies

widely according to the city, line, and time of the day.

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Taxi:

Taxis are very common and relatively accessible price-wise. They have different colours

and fares in different cities, though a highly contrasted black-and-yellow design is

common to the largest conurbations. Call-taxi companies (radio-taxis) are very common

and safe; illegal taxis are common in big cities, and robberies have been reported in those

cases. The remisse is another form of hired transport: they are very much like call-taxis,

but do not share a common design, and trip fares are agreed beforehand, although there

are often fixed prices for common destinations.

Commuter rail:

Suburban trains connect Buenos Aires city with the Greater Buenos Aires area, (see:

Buenos Aires commuter rail network). Every weekday, more than 1.3 million people

commute to the Argentine capital for work and other business. These suburban trains

work between 4 AM and 1 AM. Many of the lines are electric, several are diesel

powered, while some of these are currently being converted to electric.

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Metro:

As of 2008, Buenos Aires is the only Argentine city with an underground metro system,

nonetheless there is a project to build a system in the city of Córdoba (Córdoba Metro)

making it the second metro system in Argentina. The Buenos Aires Metro (Subterráneo

de Buenos Aires) has currently six lines, each labelled with a letter from A to H. Daily

ridership is 1.3 million and on the increase. Most of the lines of the Buenos Aires Metro

connect the city centre (Micro-centro) with areas in the outskirts.

Tram:

Trams (streetcars), once common, were retired as public transportation in the 1960s but

are now in the stages of a slow comeback. In 1987 a modern tram line was opened as a

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feeder for the subway system. A modern light rail line between the Bartolomé Mitre

suburban railway station and Tigre (Tren de la Costa) inaugurated in 1996 operates in the

northern suburbs. A 2 kilometre tram known as the Tranvía del Este (Eastern Tram) was

inaugurated 2007 in the Puerto Madero district in Buenos Aires using French Citadis

trams.

Rail Transport:

The railroad net constitutes one of the main means of transport between the City of

Buenos Aires and the metropolitan area, and also connects the capital city with some

cities of the interior of the country. The tourist circuits offer visitants a different way to

travel around our country. A five-year railroad modernization and rationalization plan

was initiated by the military government in 1976, but the general decline of the railway

system was not halted, and the number of passengers carried dropped from 445 million in

1976 to about 300 million in 1991. The subway system in Buenos Aires, completely state

owned since 1978, consists of five lines totaling 36 km (22 mi).

Statistics:

31,902 km - country comparison to the world: 9

Passengers annually: 2 billion

Freight: 26 million metric tons

Total km 31,902 km


Passengers annually 2 billion

Freight 26 million metric tons

Long-distance passenger service:

Services on Argentina's passenger railway system, once extensive and prosperous, were

greatly reduced in 1993 following the break-up of Ferrocarriles Argentinos (FA), the

now-defunct state railroad corporation Since that date, however, several private and

provincial railway companies have been created and have resurrected some of the major

62

passenger trains that FA once operated. The railway network is, however, far smaller than

it once was Trenes de Buenos Aires, Ferrocentral, Ferrobaires, and Tren Patagónico are

some of the private companies that now manage Argentina's long distance passenger rail

network

High-speed rail:

A high-speed rail between Buenos Aires, Rosario and Córdoba with speeds up to

320 km/h is in the design stages, construction will begin by early-2009 until the end of

2012 for the first segment to Rosario. In 2007 bids were called for a turnkey contract for

a second high speed line, linking Buenos Aires and Mendoza In February 2008 national

government announced another call for bid, this time for construction of a high speed

train linking Buenos Aires and Mar del Plata; The Mar del Plata TAVe

Freight service:

Over 25 million tons of freight

were transported by rail in 2007. Currently, five carriers operate freight rail services in

Argentina:

Nuevo Central Argentino

Ferroexpreso Pampeano

Ferrosur Roca

América Latina Logística

Belgrano Cargas

63

Tourist railways:

A number of steam powered heritage

railways (tourist trains) are in operation; the Old Patagonian Express (locally known as

“La Trochita”) in Patagonia, the Train of the End of the World (Southern Fuegian

Railway) in Ushuaia, Tierra del Fuego and a short run Tren Histórico de Bariloche. A

diesel-electric Tren a las Nubes in the province of Salta runs from the city of Salta to San

Antonio de los Cobres, (at present this service is being restored).

Air Transport:

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Though expensive in comparison with the other means of transportation, air travel is

becoming increasingly common. Every provincial capital has its own airport, and there

are many others, specially in tourist areas such as Bariloche and El Calafate (see list of

airports in Argentina). Buenos Aires is the most important air terminal in South America.

The four principal airports include Aeroparque and Ezeiza, both at Buenos Aires,

Catarata Iguazu at Iguazu, and El Plumerillo at Mendoza. In 2001, there were 1,369 total

airports and landing fields, of which only 145 had paved runways. The government line is

Aerolíneas Argentinas; however, there are other major Argentine airlines and many

foreign lines operating in the country. In 1997, the total scheduled civil aviation services

flew 124 million freight ton-km (77 freight ton-mi) and carried 5,738,600 passengers on

domestic and international flights.

Airports

Total (including airstrips): 1,272 (2007) - country comparison to the world: 7

With paved runways:

Total: 154

Over 3,047 m: 4

2,438 to 3,047 m: 26

With unpaved runways:

Total: 996

Over 3,047 m: 1

2,438 to 3,047 m: 1

65

1,524 to 2,437 m: 65

914 to 1,524 m: 50

under 914 m: 9 (2008)

1,524 to 2,437 m: 45

914 to 1,524 m: 526

under 914 m: 423 (2008)

Merchant Marine:

River traffcic is mostly made up of cargo, especially on the Paraná River, which is

navigable by very large ships (Panamax kind) downstream from the Greater Rosario area.

There is a total of 10,950 km (6,800 mi) of navigable waterways, offering vast

possibilities for efficient water transportation. The river system reaches Paraguay,

northeastern Argentina, and regions of Brazil and Uruguay.

The Paraná is easily navigable up to Rosario, but the 171-km (106-mi) stretch between

Rosario and Santa Fe has considerably less depth and is less suitable for oceangoing

vessels.

Statistics:

Waterways

10,950 km navigable (2008) - country comparison to the world: 12

Freight: 28 million metric tons

66

Total km 10,950 km navigable (2008)


Freight 28 million metric tons

Merchant Marine

By type: bulk carrier 3, cargo 9, chemical tanker 2, container 1, passenger

1, passenger/cargo 3, petroleum tanker 24, refrigerated argo 2, roll on/roll

off 1

Registered in other countries: 19 (Liberia 3, Panama 8, Paraguay 5,

Uruguay 3)

bulk carrier 3

cargo 9

chemical tanker 2

container 1

passenger 1

passenger/cargo 3

petroleum tanker 24

refrigerated Argo 2

roll on/roll off 1

Registered in other countries 19(Liberia 3, Panama 8, Paraguay 5,

Uruguay 3

Ports and harbors:

Bahía Blanca Necochea

67

Buenos Aires

Comodoro Rivadavia

Concepción del Uruguay

La Plata

Mar del Plata

Río Gallegos

Rosario

Santa Fe

San Antonio Oeste

Ushuaia

Indian Transportation Sector Overview

Road sector in India

Second largest road system in the world at 3.3mn km

NH Density on Area at 3.7 km vis-à-vis 6.5 km and 26.1 km of Total Road Network per

1000sqkm of land area in China and US respectively

NH Density on Population at 0.01 km vis-à-vis 0.05 km and 0.84 km of Total Road

Network per1000 people in China and US respectively

Quality of roads at 87th position in the world, way below China, Pakistan & SriLanka

68

Ports in India

Growth in Cargo traffic at a CAGR of ~10% in the past five years

~80% of the total traffic comprises dry & liquid bulk, remaining being general includingcontainerized cargo

12 Major ports and ~187 non-major ports in India

Major ports handle ~70% of total volume of cargo

Capacity expansion plan of Rs.558 bn till FY14 under the NMDP, 2005

Capacity expected to increase 2.14x from 736.9 mn tons to 1.5 bn tons by 2014

Airports in India

Rapidly Expanding market

At ~25% p.a one of the fastest growing aviation markets in the world despiteglobal slowdown

Airlines are competitive and consolidation is bearing fruit

68

Ports in India







Airports in India




68

Ports in India







Airports in India




69

Over 400 new aircrafts have been ordered since 2005

Airport Infrastructure

Govt encouraging Pvt Sector participation to augment infrastructure to meetincreasing air traffic

Bangalore & Hyderabad airports now fully operational

Delhi/ Mumbai Airports are still under development by private developers

5 greenfield airports planned under BOT –yet to take off

Modernization of non-metro airports by AAI –flip-flops on bids seen

Railways in India

Remarkable turnaround by Indian Railways has breathed new life–into this life line ofIndian transportation

Railway intends to spend USD 55 bn into various development schemes

Safety–37% Capacity increase–24%, Roling stock–18%, Dedicated freight corridor–10%,Metro rail projects–9%

Surplus land utilization will also bring in more funds for investment

Inland Waterway Transport in India

India has 14,500 km of navigable waterways comprising of rivers, canals, backwaters,creeks

5,700 km out of 14,500 km of IW is navigable by mechanized vessels

Presently, navigation restricted to only a few stretches such as

~45 MT of cargo (2.5 bn tonnes-km of traffic)

~70% of traffic in terms of tonne-km contributed by iron ore export through rivers inGoa

Central Inland Water Transport Corporation (CIWTC) has been a Principal operatorof vessels (barges) on IWs

70

IWT modal share 0.3% in transport

New Draft Maritime Policy vision–IWT Modal share of 2% by 2025

ADVERTISING AND MEDIA SECTOR OF ARGENTINA

BASIC DATA

Official Country Name: Argentine Republic

Region (Map name): South America

Population: 37,384,816

Language(s): Spanish (official), English, Italian, Germany, French

Literacy rate: 96.2%

Area: 2,766,890 sq km

GDP: 284,960 (US$ millions)

Number of Daily Newspapers: 106

Total Circulation: 1,500,000

Circulation per 1000 61

Television Sets per 1,000 212.7

Radio Receivers per 1,000 650.0

Computers per 1,000 50.8

Cable Subscribers per 1,000: 163.1

Internet Access per 1,000: 66.9

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Total Newspaper Ad Receipts: 1,136 (US$ millions)

As % of All Ad Expenditures: 35.00

Number of Television Stations: 42

Number of Television Sets: 7,950,000

Number of Cable Subscribers: 6,034,700

Number of Radio Receivers: 24,300,000

Number of Individuals with Computers: 1,900,000

Number of Individuals with Internet Access: 2,500,000

ADVERTISING OVERVIEW

ADVERTISING OVERVIEWARGENTINA

ADVERTISING OVERVIEW INDIA

The Latin American model of commercial

broadcasting superficially is quite similar

to that developed in the United States. This

model consists of privately owned,

commercially-financed radio and television

stations with one or more large companies

controlling a significant market share.

Early American investments in Latin

American radio and television stations

facilitated the adoption of this commercial

broadcasting model, and the region’s media

were internationalized many decades

before globalization became a buzzword in

political and academic circles.

Paradoxically, the Latin American media

Indian advertising industry is well

recognized all over the world for its

creative output and high quality

advertisements. The performance of

Indian agencies and advertisement &

marketing campaigns has been well

noted and awarded at various global

stages such as Cannes Lions. The

industry is continually evolving to

give better returns to clients and

memorable ads for the target audience.

Such is the power of Indian

advertisement – that these ads have

become true legends, and will remain

etched in the minds of viewers and

72

were both unregulated and highly

controlled. The ruling elite demanded

economic growth and political stability,

satisfied by a docile commercial

broadcasting system under their political

thumb (Fox 1997). In some countries,

alongside precocious commercialization,

nationalism also shaped how the media

developed. Factions within governments

and progressive social movements pushed

for increased state control of domestic

radio and television in order to ensure

domestic content and national, rather than

foreign, ownership. These nationalist

measures were largely successful when

motivated by the need for increased

political control of the media but largely

unsuccessful when motivated by

considerations of public service or

preserving national culture (Waisbord

1995).

readers for a long, long time. The

Indian advertising industry has also

given such worthies as Alyque

Padamsee (the man behind Lalitaji and

Liril campaigns) and Piyush Pandey.

The Indian market is also unique in

the sense that TV advertising is

actually increasing and set to overtake

print advertisements over the coming

years. Leading ad planners believe

that the Indian audience still loves

watching TV, and is very receptive to

TV ads. In addition, the TV ads are

very audio visual in nature, and can

easily overcome any barriers of

illiteracy, which is a major

impediment for print advertising and

marketing in India.

Another notable trend on a global

level that still evades the Indian

advertising industry is the mass

migration of ad spending to online and

digital media. In highly developed ad

markets such as US and UK, the ad

spending on digital and online media

has increased exponentially, and has

actually exceeded ad spending on print

advertising. Now, online ad spending

constitutes almost 15% of overall ad

spending in these markets. In India,

online advertisements are still to take

73

off. This trend will continue for at

least the medium term, unless

something on the lines on the mobile

phone revolution happens, and more

Indian get access to reliable internet

access.

ADVERTISING FACTS AND FIGURES OF INDIA

The turnover of Indian ad industry is less than 1% of the national GDP of India.

In contrast, the share of US ad industry in national GDP of USA is 2.3%. This

indicates a tremendous growth potential for the Indian advertisement and

marketing industry.

The Indian ad industry is still evolving, as far as the scale of operations and scope

are concerned. The global ad industry turnover is close to USD 450 billion

annually, while India contributes less than 1.5 % of that figure. However, Indian

ad industry is one of the fastest growing all over the world, perhaps next only to

China and Russia.

The global ad industry is expected to clock a growth of about 2% in 2010, which

is a major recovery over 2009. The Indian ad industry, in contrast, will grow by

an estimated 10% to reach a figure of about Rs 23,700 crores. The major growth

factors for 2010 will be the increase in ad spends focused on events such as IPL

and football World Cup.

In 2009, the Indian ad industry had suffered a major setback, and had shrunk,

primarily due to a drastic decrease in print advertising spending – which suffered

a massive cut of Rs 2,000 crores.

The leading advertisement medium is newspapers and television, with an almost

equal share totaling 75% of the total pie. Magazine advertising constitutes a very

small 3%, while online and digital advertising spend is substantially less than 1%

of the total ad industry turnover. Nevertheless, the spending on digital and online

advertisements is increasing at a fast rate of 25%.

74

In addition to print and television, the other popular advertisement and marketing

media are radio, cable TV, direct mail and outdoor advertisements and publicity.

The biggest ad spenders are FMCG companies such as Unilever, P&G, ITC and

PepsiCo and automotive companies such as Maruti and Hero Honda. These

companies have huge ad budgets running into hundreds of crores of rupees, and

therefore, wield tremendous bargaining power over their ad agencies.

The biggest ad agencies in India are the subsidiaries and arms of their foreign

principals, such as Ogilvy, JWT and Lowe. Very few indigenous ad agencies have

managed to make a mark, and most of them have been acquired or merged by

foreign ad agencies.

The emerging advertisement and marketing media in India are mobile

advertisements, internet, direct calling (especially for financial services) and FM

radio (for local businesses).

Figures of INDIA:-

Particular Current Size Projected Size

Television 148 Billion 427 Billion

Print Media 109 Billion 195 Billion

Filmed Entertainment 68 Billion 153 Billion

Radio 03 Billion 12 Billion

Music 07 Billion 7.4 Billion

Live Entertainment 08 Billion 18 Billion

Out-of-Home Advertising 09 Billion 17.5 Billion

Internet Advertising 1.6 Billion 7.5 Billion

75

ADVERTISING FACTS OF ARGENTINA

Media Environment in Argentina

There has been a 36 percent increase in all forms of advertising over the last 12months.TV is the most important medium in terms of advertising, concentrating 53percent of all ad spend.

Argentineans spent 50 percent of their time outside of the home so it’s importantto take advantage of all advertising media. Like many other countries, Argentina’sAdvertising is saturated. On average, each person receives over 2,500 ad messages perweek. We can see how this is distributed among all Media:

Share of Media

Argentina’s Top Advertisers

1. Danone Argentina2. Unilever Argentina3. SC Johnson & Son Argentina

44%

25%

6.40%

5.20%

4.60%

14.80%

Share of MediaOut-of-House

Open TV

News Papers

Cable TV

Magazines

Radio

76

4. Presidencia de la Nación (national government)5. GlaxoSmithKline

INDIA ADVERTISING MARKET

Total Advertising expenditure in local currency at current prices

ADVERTISING MARKET IN ARGENTINA

106858123770

149396

179879

213801227579

250035

284774

0

50000

100000

150000

200000

250000

300000

Expenditure

2004 2005 2006 2007 2008 2009 2010 2011

77

ATTITUDE TOWARDS ADVERTISING

Attitude towards Media in India Attitude towards Media in Argentina

To be able to work inside governmental

buildings such as the National Congress

or the president's office and residence, a

special accreditation provided by the

respective institutions is required.

According to this foreign press

association, in Argentina there are around

150 foreign correspondents, half of which

are Argentines working for foreign media

companies.

The current government of Argentina

Advertising, “the business of encouraging

people to buy products and services using

the channel as a medium to deliver the

advertising message” (Leppaniemi et al,

2005). However it can be said that the

minimum scope of this new phenomenon is

“advertising that uses terminals” (Bulander

et al, 2005) and the maximum scope is

using advertising as a interactive and

ubiquitous marketing medium to provide

consumers with personalized information

78

does not review or censor cables or news

sent abroad by foreign journalists

working in the country. The last time

some type of censorship mechanism was

imposed was during the last military

government (1976-83), when the state

checked on foreign correspondents'

activities as part of their overall objective

of controlling the news flow. There are

no established procedures for government

relations with the foreign press.

Foreign ownership of media companies

started to increase with the withdrawal of

state companies and the slow

deregulation of the market that began

after the election of Menem to the

presidency. In regard to the newspaper

business, companies from Spain have

made important inroads in the market. An

Argentine investor sold the first

privatized television channel, Canal 9, to

the Australian company Prime Television

for $150 million in 1997. Two years later

the Spanish company Telephonic bought

it for $120 million. And in 2002 it was

bought by an Argentine consortium.

Another foreign player in broadcasting is

the Mexican group CIE Rock & Pop,

which currently owns eight radio stations.

In light of the serious financial situation

faced by the local news media, Congress

according to where they are and their needs,

thereby persuading the receiver to take

some action, now or in the future, about

goods, services and ideas. However the

minimum scope of mobile advertising is

more suitable for this study, as SMS-based

mobile advertisements are more usual in

Iran and other forms of mobile advertising

rarely used.

Attitude is an important concept in

marketing. Kotler and Keller (2006) stated

that “an attitude is a person’s enduring

favorable or unfavorable evaluations,

emotional feelings, and action tendencies

toward some object or idea”. Therefore,

positive attitude toward advertising refers to

favorable evaluations and willingness

toward it. As noted above, more recent

researchers have found that consumers

generally have negative attitudes toward

advertising and also mobile advertising.

There are factors that affect attitude towards

advertising. In the following sections, we

identify the factors that may influence

attitude toward advertising and then

develop a number of hypotheses that are

examined in the remainder of the paper.

79

is discussing a law limiting the share of

foreign companies in cultural enterprises.

Company Overview of Leo Burnett Worldwide, Inc. Operating in both the countriesIndia as well as Argentina

Leo Burnett Worldwide, Inc. operates as an advertising agency. Its services

include quantitative research, context planning, strategic planning, optimization,

segmentation and targeting, digital strategy, and specialty insights; film and television,

mobile, press/print/editorial, promo, digital, media, radio, design, ambient/outdoor,

integrated and direct; media buying, event sponsorship and management, database

marketing, direct marketing, promotions, and shopper marketing; and brand navigation,

and digital workflow. The company was founded in 1935 and is based in Chicago,

Illinois. Leo Burnett Worldwide, Inc. operates as a subsidiary of Publicist Grouped SA.

Leo Burnett is among the world's best-known agency brands, responsible

for creating what has become known as the "Chicago School" of advertising, which made

a virtue of simplicity and clarity, and was most strongly defined by the use of brand

mascots, fictional characters who were used to personify individual brands. Uncle Ben,

the Jolly Green Giant, Tony the Tiger, the Pillsbury Dough-Boy and the Marlboro Man

were all Burnett inventions. The agency capped the 1990s with a show stopping deal

which combined the forces of three major agency groups. In 1999, Burnett's acquired

D'Arcy parent MacManus, stealing that business from under Interpublic's nose for $1bn;

then sold a 20% stake in the combined group to Japanese giant Dentsu for a rumored

$400m to create one of the world's biggest marketing groups, named Bcom3. The final

twist came in 2002 with capture of Bcom3 by Publicist, and the subsequent merger of the

D'Arcy network into Burnett. In 2007, Leo Burnett merged with below-the-line unit Arc

Worldwide under a single management team, although it continues to use both brand

names.

80

This company has come up with some great ideas to promote brands. The #2

ad agency in the US (behind WPP Group's JWT), Leo Burnett has helped create some of

the top consumer brands, including Kellogg's Frosted Flakes cereal and its Tony the

Tiger icon. It offers creative development and campaign planning services through about

95 offices in almost 85 countries. Its Arc Worldwide subsidiary provides promotional and

direct marketing services, as well as multimedia and interactive marketing development.

LEO BURNETT IN INDIA LEO BURNETT IN ARGENTINA

The agency had a good run with new

business wins including Iodex, Hero,

Asia Motor Works, Coke Studio and

Samsung’s refrigerators, retail business

and some mobile projects. Campaigns

for McDonald’s, Reliance Digital TV,

Kaun Banega Crorepati and HDFC Life

were some of the more visible work

from the agency during the year.

Though the agency did not get much

recognition at Cannes Lions 2011 for

their Gandhiji Font, the agency won a

bronze at Spikes Asia 2011. The

agency led the Indian tally at Ad fest

2011 with six metals, Also it

was recognized for their work at New

York Fest, D&AD and Clio. In the

domestic awards circuit, the agency

won three Gold, eight Silver and nine

Bronze metals at Goa-fest.

Overall, though the agency has

managed to win new businesses, the

jury felt that it hasn’t been an

Leo Burnett is one of the senior brands

within the middle tier of international

agency networks, with a balanced

reputation for good (and sometimes

great) creative work underpinned by

skilled account management. It ranks

among the leading agencies on its home

turf, but sits within the middle tier or

below in most international

markets. The network enjoyed another

successful year during 2011, ending up

as the 4th most awarded network

worldwide, according to Gunn Report

global rankings. The year ended with

the capture of the US Sprint Nextel

account, one of its biggest new business

gains for several years.

Now firmly part of the Publicist Group,

Leo Burnett operates a network of more

than 200 operating units around the

world, including 96 full-service

advertising agencies in 84 countries. It

is positioned as an agency which

81

outstanding year for Leo Burnett and

hopes to see truly great work next year.

Leo Burnett India is a full service

advertising agency that offers end to

end solutions to clients for their brands.

This includes campaigns across mass

media and below the line (including

digital and activation). It is part of the

Leo Burnett Group worldwide.

Leo Burnett India also has Arc

Worldwide (our below the line arm)

and Orchard Advertising (our second

agency). We have offices in Mumbai,

Delhi and Bangalore.

Leo Burnett India is rated among top 5

agencies in the country, has created

memorable campaigns for several

brands in its portfolio. It has been

building insightful campaigns for

McDonald’s, Complan, Glucon D,

Thums Up, Maaza, Perfetti, Tide,

Whisper, Samsung, Uninor, Tata

Capital, Tata Salt, HDFC Life

Insurance, General Motor, and Bacardi

among others.

Leo Burnett India has won International

and National awards year on year at

Cannes Festival, Adfest, D&AD, Clio,

One Show, London International

Awards, Spikes Asia, Lotus Awards,

Andys, New York Festival, Goafest and

specializes in "icon brands", or "ideas

that inspire enduring belief", and

indeed, more even than that other

founder-created advertising brand

Ogilvy, Burnett's leans heavily on its

own iconic heritage. It makes

considerable use of its own icon brand,

Leo Burnett himself, his various

aphoristic sayings, his black mark-up

pencils, and the much-quoted story

about apples (see below). Including

marketing services subsidiaries,

Advertising Age estimated consolidated

revenues of $1.2bn in 2010.

Leo Burnett's main US agency is still

located in its traditional home city of

Chicago, although there are also service

offices in New York, Los Angeles and

Detroit.

Leo Burnett New York is primarily an

administrative centre, coordinating

international network accounts such as

Samsung. However that unit is

expected to grow in stature following

recent new account wins. The Los

Angeles office offers a similar service

for entertainment industry accounts.

Advertising Age estimated advertising

revenues for Leo Burnett USA of

$441m (or 36% of global revenues) in

82

Mirchi Kaan Awards. Leo Burnett

India has also been declared the ‘Global

Agency of the Year’, across Burnett’s

86 nation network twice.

We are a truly integrated creative

agency and strongly believe that a great

idea can come from anywhere.

2010.

83

Leo Burnett creates campaign in India and Argentina

Thumbs Up gets all new star cast and tagline

Singapore Tourism Board rolls out new campaign for India

Maaza pitches itself as the "Har mausam aam" in new TVC

HDFC Life's new campaign says 'Click 2 Protect' your family

Looking Back: 2011, Going ahead: 2012 - Arvind Sharma

McDonald's promotes its 'Happy Price Menu' in new campaign

Goafest 2012: Event to be held from 19 to 21 April

Looking back: 2011, Going ahead: 2012 - KV Sridhar (Pops)

Campaign India Agency Report Card 2011: Leo Burnett

Tata Capital’s new TVC highlights its home loans

McDonalds asks you to slow down a bit with its new TVC

Reliance Digital TV refreshes brand image with a new campaign

Pops' iCannes 2011

Cannes 2011: Predict and win contest

Leo Burnett and Campaign India present ‘Cannes 2011 Prediction Reel’ contest

Minute Maid Nimbu Fresh launches ‘First Love’ campaign

Stunts galore in new Thumbs Up TVC featuring Akshay Kumar

HDFC Life urges parents to start financial planning early for child's future

84

ENTREPRENEURSHIP SECTOR IN ARGENTINA

INTRODUCTION OF COMPANY PROFILE

ADECOAGRO (ARGENTINA)

1.1 HISTORY OF ADECOAGRO

In September 2002, we commenced our operations with the acquisition of 100% of the

equity interests of Pecom Agropecuaria S.A. (“Pecom”), an Argentine corporation

(sociedad anónima), and the we rapidly became one of the largest agricultural companies

in Argentina. Involving more than 74,000 hectares of farmland, this acquisition

represented one of the largest stock purchase transactions in South America in 2002. In

connection with the acquisition, Pecom changed its name to Adeco Agropecuaria S.A.

Adeco Agropecuaria was the platform from which we executed our expansion plans,

including the acquisition of additional land and the diversification of our business

activities.

We were incorporated, in Luxembourg, on June 11, 2010 and on October 30, 2010; the

members of IFH LLC transferred pro rata approximately 98% of their membership

interests in IFH LLC to Adecoagro S.A. in exchange for common shares of Adecoagro

S.A.

85

1.2 CORPORATE PROFILE

We are a leading agricultural company in South America. Adecoagro owns over 295

thousand hectares of farmland and several industrial facilities spread across the most

productive regions of Argentina, Brazil and Uruguay, where it produces over 1 million

tons of agricultural products including corn, wheat, soybeans, rice, dairy products, sugar,

ethanol and electricity among others.

Our sustainable business model is focused on (i) a low-cost production model that

leverages growing or producing each of ours agricultural products in regions where

Adecoagro believes to have competitive advantages, (ii) reducing the volatility of the

Company´s returns through product and geographic diversification and use of advanced

technology, (iii) benefiting from vertical integration in key segments of the agro-

industrial chain, (iv) acquiring and transforming land to improve it´s productivity and

realizing land appreciation through strategic dispositions; and (v) promoting sustainable

agricultural production and development.

1.3 BUSINESS

Adecoagro is one of the largest owners of productive farmland in South America. As of

September 30, 2010, Adecoagro owned 274,663 hectares (excluding sugarcane farms) of

farmland in Argentina, Brazil and Uruguay, of which 121,723 hectares are croppable,

18,909 hectares are being evaluated for transformation, 79,645 hectares are suitable for

raising beef cattle and are mostly leased to a third party beef processor, and 54,387

hectares are legal land reserves pursuant to local regulations or other land reserves.

Crop business: Adecoagro produces a wide range of agricultural commodities

including soybeans, corn, wheat, sunflower and cotton, among others.

Rice business: Adecoagro owns a fully-integrated rice operation in Argentina.

The Company produces irrigated rice in the northeast provinces of Argentina,

86

where the availability of water, sunlight, and fertile soil results in one of the most

ideal regions in the world for producing rice at low cost. Adecoagro is one of the

largest producers of rough (unprocessed) rice in Argentina, producing 91,000 tons

during the 2009/2010 harvest year, which accounted for 8% of the total Argentine

production according to Conmasur. Adecoagro owns three rice mills that process

its own production as well as rice purchased from third parties.

Coffee business: Adecoagro´s integrated coffee operation is located in the

western part of the state of Bahia, Brazil, where conditions are well-suited for

producing “Specialty Coffee” due to the availability of water for irrigation, the

absence of frosts, and the flat topography that allows for a fully mechanized

harvest.

Dairy business: Adecoagro is one of the leading dairy producer in South America

in terms of its utilization of cutting-edge technology, productivity per cow and

grain conversion efficiencies.

Cattle business: Adecoagro´s cattle business primarily consists of leasing

approximately 74,000 hectares of grazing land located in the Argentine provinces

of Corrientes, Formosa, Santa Fe and Santiago del Estero.

87

ENTREPRENEUR - MARIANO BOSCHDirector and Chief Executive OfficerAdecoagro SA

Mr. Bosch is a co-founder of Adecoagro and has been the Chief Executive Officer for all

operations in Argentina, Brazil and Uruguay since inception and a member of the

Company’s board of directors since 2011. From 1995 to 2002, Mr. Bosch served as the

founder and Chief Executive Officer of BLS Agribusiness, an agricultural consulting,

technical management and administration company. Mr. Bosch is also currently a

member of the advisory board of Teays River Investments LLC, a farmland investment

management firm in North America. Mr. Bosch has over 18 years of experience in

agribusiness development and agricultural production. He actively participates in

organizations focused on promoting the use of best practices in the sector, such as the

Argentine Association of Regional Consortiums for Agricultural Experimentation

(AACREA) and the Conservational Production Foundation (Producir Conservando). He

graduated with a degree in Agricultural Engineering from the University of Buenos

Aires. Mr. Bosch is an Argentine citizen.

PROSPECTS FOR BUSINESSAdecoagro is focused on producing food and renewable energy to supply the world. We

believe the demand for food and renewable energy will continue growing, driven by the

constant growth of the global population and the income in Brazil, China, and India and

also in other undeveloped countries. In the short term, we expect demand to remain

stable, since the demand for this type of basic goods is inelastic. However, we are very

cautions and do not discard a scenario where commodity prices fall. We are focused on

maximising liquidity and the risk-return profile of every dollar we spend.

CHALLENGES

Adecoagro’s greatest challenge for growth is recruiting the right people to manage

operations.

In large cities, this is relatively simple but it is not so easy in the interior of the

countries, where our farms and agroindustrial operations are located.

88

To continue growing, we need human capital. It is a difficult task to find people who

understand efficiency and focused on return on investment and sustainable

production, and are good leaders who can motivate teams.

We spend a lot of time and money in training our people, but it is a process that

cannot be done from one day to the next.

Cultural differences are always hard to learn and manage, but in time they can be

overcome. The advantages of new countries relate to volume and large orders and,

once trust is in place, the market opens and opportunities start to grow.

STRATEGY

Our strategy has not changed. Following our IPO on January 28 of this year, where we

raised over 423 million dollars, we continue strengthening and growing our three main

business lines. We continue focusing our growth decisions based on maximising the

return on invested capital.

GOVERNMENT SUPPORT

One of the key things that we hope the Government will allocate resources to strengthen

of education, especially in the interior of the country. In fact, we are having discussions

with several governmental agencies promoting that rural schools should train their

students in the theory of knowledge, as well as helping them to develop an

entrepreneurial spirit. This is essential for both the young people who work with us and

for those who will set up their own businesses to sell us products and services.

ENVIRONMENTAL RISKWe manage and operate natural resources such as land and water that are key for our

business and our operations. Therefore, taking care of these resources with a long term

view is part of our core business strategy and is discussed and evaluated by the board of

directors. Environmental risk is constantly assessed by external consultants and our

managers who are guided under the highest sustainability criteria.

A clear example is how we manage our land. By applying a sustainable production model

based on No-Till and other best practices we achieve our environmental goals of

protecting the quality of soil and our business targets of increasing crop yields, reducing

production costs and increasing the value of the land.

89

ENTREPRENEUR -KARAN A CHANANA

AMIRA FOODS INDIA LIMITED

The Amira Group was founded in 1915 and has evolved from Trading into Processing,

Branding and Distribution of Rice and Agro Commodities to become India's Largest

privately held Rice Company. Today taking this business legacy forward under the

stewardship of Shri Karan a Chanana, Chairman The Amira Group received the

prestigious status of 'Global Growth Company' from the World Economic Forum.

This accreditation is based on parameters including demonstrated leadership,

outstanding execution and acknowledged operating experience.

Amira Foods has set another benchmark in the industry with Brand Amira being

honored with this prestigious title THE INDIAN POWER BRANDS; THE

GLOBAL SUPER POWER EDITION chosen by the Indian Consumer. The

parameters of this recognition are based on the most powerful companies of India

that have the potential to be "SUPERPOWERS".

Chairman the Amira Group Mr. Karan a Chanana was awarded Power Brands

Hall Of Fame Corporate icon/Leader Award 2011 at the Power brands Hall of

Fame Awards for his contribution in Food Industry and demonstrated Leadership

& Excellence in establishing an International Brand Identity and in turn become

an Indian media vehicle globally.

A Family owned Brand since 1915

A category focus on rice is well rounded through a commitment to other agro-

Commodities and Bulk Commodity Trading in pulses, sesame seeds, sugar, onion,

potatoes, maize, soybean extract, edible oil, palm oil, wheat, wheat flour,

rapeseed, millets and spices.

The Amira brand has established a reputation for fair trade practices. Quality

products, honest pricing and the assurance of customer satisfaction have been the

guiding philosophy to grow the brand.

90

AMIRA FOODS SET TO CAPTURE UAE MARKET WITH CHOITHRAMS:

Amira Foods India Ltd, a leading rice company, is set to capture the UAE market with its

recent strategic collaboration with Choithrams, a UAE-based supermarket chain. With

this collaboration, Choithrams will distribute and place Amira premium Basmati brands –

Amira Pure Basmati Rice, Traditional Basmati, Amira Indigo Extra-long Grain Basmati

Rice and Amira Good length Basmati Rice – in the UAE market.

91

Karan A Chanana, group managing director, Amira Group, says, “We see exponential

growth in the Middle East, as the region has refined culture. We also foresee a successful

venture in this tie-up, as visitors from all over the world visit Dubai.”

Choithrams is a successful group with associates in diverse fields, including wholesale,

commodity brokerage and manufacture of edible and non-edible items.

Today, Dubai is a destination market and show window for premium and luxury brands.

Keeping this at the back of the mind, Amira Foods has launched its top-end three Basmati

brands in the UAE market with the aim to achieve at least 10-12 per cent market shares in

the first year of operations. Moreover, Dubai is also a gateway to re-export to other

destinations like Iran in non-branded segment.

Karan A ChananaGroup Managing DirectorAmira Foods India Limited

Under his stewardship, Karan A Chanana has steered th e Group from a family-run

operation into a professionally managed business unit. Today the company, "Amira

Foods (India) Ltd." has attained a turnover of USD$ 240 million in last financial year.

The flagship of the "The Amira Group" has established itself as the largest privately

owned rice exporter in the country.

Rice is an important part of the staple diet of billions across Asia. It s no mere accident

that the companies that deal with rice growing and milling form one of the most

profitable ventures on our continent. We spoke to Karan A Chanana from Amira Foods

(India) Ltd which is one of the largest rice companies in India to learn more about the

humble food grain and its incredible entrepreneurial possibilities.

92

Passion & Vision

A man with dynamic leadership abilities. An effective team builder with sound

communication skills. A strategic thinker and pragmatic in his approach, he is set about

his vision of growing the business with single-minded purpose. Innovative in his

marketing skills and astute in managing a complex supply chain. His dedications stems

from a firm belief that we must give back to society in some measure, what we have

received in abundance.

FACTORS LEADS TO GROWTH

Amira’s plan is to minimize our dependence on externalities as much as possible through

a process of vertical integration. Thus scaling up entails integrating at every step of the

value chain from the farm to the fork. Moreover, the vision is to scale up not only

vertically, but also horizontally, in terms of the sheer no. of countries where Amira

establishes its footprints, thus building a truly world class brand.

CHALLENGES

When took reign of the Amira leadership, what is inherited was an inward looking and

rigid culture. But it’s a moot point that the only way to survive in today’s dynamic world

is to be nimble footed, which requires a robust process driven company which has

capable people at the helm who have the caliber to use their discretion to make critical

decisions, and not a place where the entire management is top down. Making this

transition required a sustained commitment, and mobilizing our own people to make

them instruments of change – a metamorphosis which Amira has experienced beautifully.

TIP FOR ASPIRING ENTREPRENEURS

The only tip which can give is the credo they believe in, which is ‘Everyday is the first

day of the rest of your life’. Hence whatever setbacks life throws your way, take them in

your stride, and keep moving ahead, because everyday presents itself with a new

93

opportunity for you, which is just waiting to be explored. So just seize the day! And also

on a more prudent note – ‘Always have a Plan B’. This does not mean that you do not

have faith in your plan A, it just means that you are prepared to give the market and the

environment the respect that it deserves.

THOUGHTS ON INDIAN ENTREPRENEURS

They truly believe that Indian entrepreneurs have an edge over those from other

nationalities as, if they can do business in India, than you can do business anywhere! But

on a technological front, it’s very critical to keep abreast of the latest technology, and

quickly inculcate the same in your system before the market inevitably forces you to do

so.

94

AGRICULTURE IN ARGENTINA AMD INDIA

Table 1: AGRICULTURE IN ARGENTINA

In Yr. 1900 1/3 Labor were consumed by Agriculture

In Yr. 1959 Portion of was Agriculture 20% of GDP

In Yr.2011 Its about 10% of GDP

10 to 15% Farmland

Foreign owned

Export in 2011 about $86Billion ( Which was ¼Portion of total export)

Export of unprocessed Agriculture,Primary goods, mainly soybeans, wheat &

maize

Other Export was( Whichwas 1/3 Portion of total

export)

processed agricultural products, such asanimal feed, flour and vegetable oils.

Table 1: AGRICULTURE IN INDIA

Agriculturalproduction

India at 2Nd Position all over world

In 2007 AgricultureProvides

16.6% of GDP and secured 52% ofmanpower

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Table 2: Rice production in India

Year In million tones

2008-

2009

99.18

2009-

2010

89.13

2010-

2011

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Table 2: Rice production in Argentina

Region in which Production

done

Total Amount of

Portion

Total Area of Production

Entre Rios 57% 150 Lots

Corrientes, 33% 927 Lots

Santa Fe, Chaco and Formosa. 10% 1672 Lots

Total Production ( Million tons) Amount of export (%) Estimated value in $

1.3 every yr. 50 175

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RICE PRODUCTION

Graph 1: ARGENTINA MILLED RICE PRODUCTION BY YEAR

Table 3: ARGENTINA MILLED RICE PRODUCTION BY YEAR

MarketYear

Prod. GrowthRate

Marketyear

Prod. Growthrate

Marketyear

Prod. Growthrate

1960 97 NA 1978 203 1.00 % 1996 783 22.15 %

1961 118 21.65 % 1979 173 -14.78%

1997 673 -14.05 %

1962 116 -1.69 % 1980 186 7.51 % 1998 1078 60.18 %

1963 124 6.90 % 1981 230 23.66 % 1999 588 -45.45 %

1964 174 40.32 % 1982 180-21.74

% 2000 567 -3.57 %

1965 107 -38.51 % 1983 309 71.67 % 2001 463 -18.34 %

1966 141 31.78 % 1984 260-15.86

% 2002 467 0.86 %

1967 184 30.50 % 1985 283 8.85 % 2003 742 58.89 %

1968 224 21.74 % 1986 229-19.08

% 2004 683 -7.95 %

1969 265 18.30 % 1987 247 7.86 % 2005 764 11.86 %

1970 187 -29.43 % 1988 291 17.81 % 2006 691 -9.55 %

1971 191 2.14 % 1989 215-26.12

% 2007 810 17.22 %

1972 169 -11.52 % 1990 299 39.07 % 2008 867 7.04 %

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1973 205 21.30 % 1991 425 42.14 % 2009 706 -18.57 %

1974 228 11.22 % 1992 395 -7.06 % 2010 1118 58.36 %

1975 201 -11.84 % 1993 395 0.00 % 2011 975 -12.79 %

1976 208 3.48 % 1994 602 52.41 %

1977 201 -3.37 % 1995 641 6.48 %

Source: http://www.indexmundi.com/agriculture

Graph 2: INDIA MILLED RICE ROUGH PRODUCTION BY YEAR

Table 4: INDIA MILLED RICE ROUGH PRODUCTION BY YEAR

Market

YearProd.

GrowthRate

MarketYear

Prod.Growth

RateMarket

YearProd.

GrowthRate

1960 52011 NA 1978 80740 2.20 % 1996 122607 6.17 %

1961 53548 2.96 % 1979 63559 -21.28 % 1997 123822 0.99 %

1962 49875 -6.86 % 1980 80527 26.70 % 1998 129133 4.29 %

1963 55553 11.38 % 1981 79952 -0.71 % 1999 134533 4.18 %

1964 59021 6.24 % 1982 70681 -11.60 % 2000 127483 -5.24 %

1965 45929 -22.18 % 1983 90155 27.55 % 2001 140024 9.84 %

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1966 45703 -0.49 % 1984 87514 -2.93 % 2002 107741 -23.06 %

1967 56474 23.57 % 1985 95747 9.41 % 2003 132808 23.27 %

1968 59701 5.71 % 1986 90633 -5.34 % 2004 124707 -6.10 %

1969 60706 1.68 % 1987 85302 -5.88 % 2005 137699 10.42 %

1970 63401 4.44 % 1988 105744 23.96 % 2006 140039 1.70 %

1971 64667 2.00 % 1989 110371 4.38 % 2007 145050 3.58 %

1972 58926 -8.88 % 1990 111448 0.98 % 2008 148785 2.57 %

1973 66143 12.25 % 1991 112031 0.52 % 2009 133648 -10.17 %

1974 59428 -10.15 % 1992 109313 -2.43 % 2010 143984 7.73 %

1975 73183 23.15 % 1993 120462 10.20 % 2011 154140 7.05 %

1976 62938 -14.00 % 1994 122727 1.88 %

1977 79005 25.53 % 1995 115482 -5.90 %

Source: http://www.indexmundi.com/agriculture

INDIA SIGNS AGRICULTURE PACT WITH ARGENTINA

BUENOS AIRES: India has signed an agreement with Argentina on conducting research

in agriculture and other allied sectors, in line with its plans to tap natural and other

resources in South America to boost its food security.

Agriculture Minister Sharad Pawar signed a memorandum of understanding on

cooperation in agriculture and allied sectors with his Argentine counterpart Julian Andres

Dominguez here this weekend.

Pawar is on a two-week long visit to Argentina, Brazil and Mexico to study the best

practices in agriculture in these countries.

The South American countries have emerged as main exporters of commodities,

especially to emerging markets, significantly denting the US- Europe domination in agri-

business sector. They have overtaken the US in soya production, accounting for 50

percent of global production,

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India this April replaced China as the biggest importer of Argentine soybean oil.

Argentina is the world’s largest exporter of sunflower and soybean oil; world’s second

largest exporter of corn; and world’s third largest producer soybeans.

With large swathes of land in a sparsely populated region, which accounts for 26 percent

of global freshwater reserves, South American nations have the highest yields per

hectare.

“The memorandum of understanding provides a framework for exchange of information

on best practices and technologies, cooperation in research and development and

promotion of trade, investment and joint ventures,” said an official release.

India is looking to replicate the success of Argentina in turning agriculture into a high-

technology sector.

The Indian delegation led by Pawar will also explore the possibility of increasing the

supply of edible oil and pulses to the subcontinent as domestic output has not been able to

meet galloping demand.

A recent report of the Inter-American Development Bank said India, given its rising

needs and buying power, would be a buyer of agricultural and mineral products of South

America.

SIGN MOU ON COOPERATION OF INDIA AND ARGENTINA INAGRICULTUREThe Union Minister for Consumer Affairs, Food and Public Distribution and

Agriculture, Shri Sharad Pawar and Argentine Agriculture Minister, Mr. Julian Andres

dominguez exchanging the signed documents of an MoU on Agricultural Cooperation,

at Buenos Aires on September 11, 2010.

Argentina agreed to step up technical and professional cooperation in the

agricultural sector and foster trade in plants and animal products between the two

countries.

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A study by the Inter-American Development Bank (IDB) released last Tuesday stressed

the great integration potential between India and Latin America and called for closer

economic ties to tap into "massive" trade and investment opportunities.

With 1.1 billion people and a scarcity of natural resources, relative to other continent-size

nations, India has the potential to be a large buyer of agricultural and mineral goods,

Latin America's main exports, said the study.

In a joint statement, the ministers drew attention to the "benefits of cooperation in the

field of agriculture and the allied sectors including the agro industrial sector".

The MOU provides a framework for exchange of information on best practices

and technologies, cooperation in research and development and promotion of

trade, investment and joint ventures.

Argentina is the largest source of import of soya oil by India. In the first seven

months of this year, India has imported soya oil worth US$1.4 billion. India is

also importing from Argentina sunflower oil and other agro-products. Argentina

is the largest exporter of soya and sunflower oils in the world.

There are 14 Indian companies which have invested about one billion dollars in

IT, agrochemicals, steel, pharmaceuticals and cosmetics in Argentina. United

Phosphorus and Punjab Chemicals & Crop Protection Ltd have invested 100

million dollars in Argentina in the production and export of agrochemicals and

seeds.

A number of Indian companies have shown interest in investment and joint

ventures in agribusiness in Argentina, which has one of the most advanced and

competitive agriculture sectors in the world.

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EXPORT IMPORT SECTOR OF ARGENTINA

Trade Group Member

Free trade agreements to which Argentina is a member to include:

Generalized System of Preferences (GSP)

This system of preferences helps developing countries improve financially andeconomically through exports to certain developed countries by providing duty-freestatus to numerous products that would normally not be.

MERCOSUR

This agreement calls for a gradual elimination of tariffs on goods originating in andtraded among member states, and the formation of a Common External Tariff (CET).

Additionally, Argentina is a participant to:

The Cartagena Agreement whose aim is to strengthen integration not only in terms oftrade, but also in other spheres such as the political, social, scientific, technological andcultural areas.

The Free Trade Area of the Americas (FTAA) whose effort is to unite the economiesof the Western Hemisphere into a single free trade agreement where barriers to trade andinvestment will be progressively eliminated, and to complete negotiations for theagreement by 2005.

Multilateral organizations Argentina is a member to include the United Nations (foundingmember) and numerous UN agencies such as the Food and Agricultural Organization(FAO), United Nations Educational, Scientific and Cultural Organization (UNESCO),United Nations Conference on Trade and Development (UNCTAD), United NationsIndustrial Development Organization (UNIDO), the World Trade Organization (WTO),the International Monetary Fund (IMF), International Finance Corporation (IFC),International Fund for Agricultural Development (IFAD), International Atomic EnergyAgency (IAEA), International Civil Aviation Organization (ICAO), International

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Maritime Organization (IMO), International Telecommunication Union (ITU), WorldHealth Organization (WHO), World Intellectual Property Organization (WIPO), WorldCustoms Organization (WCO) and the World Meteorological Organization.

Hemispheric and regional organizations include the Organization of American States(OAS), Inter-American Development Bank (IDB), Latin-American Economic System(LAES), Economic Commission for Latin America and the Caribbean (ECLAC), Latin-American Integration Association (LAIA), Agency for the Prohibition of NuclearWeapons in Latin America and the Caribbean (OPANAL).

Environmental agreements honoured include:

The Antarctic Treaty

The Protocol on Environmental Protection to the Antarctic Treaty

The Convention on Biological Diversity

The United Nations Framework Convention on Climate Change

The Kyoto Protocol to the United Nations Framework Convention on ClimateChange

The United Nations Convention to Combat Desertification in Those CountriesExperiencing Serious Drought and/or Desertification, Particularly in Africa

The Convention on the International Trade in Endangered Species of Wild Floraand Fauna (CITES)

The Basel Convention on the Control of Transboundary Movements of HazardousWastes and Their Disposal

The Treaty Banning Nuclear Weapon Tests in the Atmosphere, in Outer Space,and Under Water

The Montreal Protocol on Substances That Deplete the Ozone Layer

The Protocol of 1978 Relating to the International Convention for the Preventionof Pollution From Ships, 1973 (MARPOL)

The Convention on Wetlands of International Importance Especially asWaterfowl Habitat (Ramsar)

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The International Convention for the Regulation of Whaling.

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General Import Clearance Information

Clearance Process

FedEx Clearance

Working with Customs officials throughout the world, FedEx has developed innovativetechnology to eliminate many steps of the paperwork-handling process and expedite themovement of international shipments. An example in Argentina is the FedExExpressclear Electronic Customs clearance system. Starting at the origin location, state-of-the-art technology allows the processing of shipment paperwork and electronictransmission of documents to the designated FedEx hub and destination clearancelocation. The Expressclear system also keeps a database of regulatory information, whichincludes; importers' numbers, broker designations, corporate contact names and telephonenumbers. At a FedEx hub, international shipments are sorted, scanned and loaded onto aninternational flight. Vital shipment information is keyed into a worldwide manifestdatabase, which is linked to computer systems operated by brokers and Customs officialsin many countries. Even before the plane has taken off, or while it is in the air, Customsagents and brokers at the destination airport of entry can begin examining shippingmanifests, querying air waybill data if they need more details, assessing duties and taxesand selecting the shipments they wish to examine. By the time the plane arrives at itsdestination, many packages have already been cleared by Customs. As the plane isunloaded, the Expressclear system identifies packages to be examined and prints"cleared" Customs labels for all others. Cleared shipments are transferred to trucks forimmediate delivery. International shipments are scanned at all key points throughout theprocess and this allows for up-to-date status reports including when Customs clearance isobtained.

Customs Clearance

In Argentina the Bureau of Customs is the governmental agency charged with theenforcement of the tariff and Customs laws and regulations.

Importation of goods into Argentina is governed by a myriad of import regulations,which are not much different from those prescribed in other countries. These regulationsand documentation requirements must be observed and complied with by shippers andconsignees as well as air carriers to expedite the Customs clearance of imported goods.

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In general, all articles imported into Argentina are subject to Customs duty and/orinternal revenue taxes and enter through a customhouse at a port or airport whereCustoms examination, tariff classification and appraisals are made. Taxes and othercharges due shall be paid (or secured for payment) prior to release from Customscustody.

All importations are entered under Informal Entry or Formal Entry except the following,which may be entered duty and tax- free:

1. Importations for the official use of foreign embassies, legations and otheragencies of foreign governments

2. Importations for the personal and family use of the members and attaches offoreign embassies

3. Miscellaneous articles that are exempt by law or process

Decree 161/99 and Resolution AFIP 503/99 established a Simplified Importation Systemand to import merchandise under this optional clearance method. It must not be over 50kg as maximum weight. Under the AFIP General Resolution 1811, dated 01/11/2005, theFOB value must not exceed the sum of $1,000 USD per day. Goods that are enteredunder this system must:

Be new, unused and not require reconditioning Not be prohibited for import, nor be subject to quotas or be regulated under other

agencies Not be protected by a regulation that implies any type of exemption or tariff

preferences

Document Requirements

Air Waybill - An air waybill or carriers certificate (naming the consignee for customspurposes) as evidence of the consignee's right to make entry.

Commercial Invoice - Required for all non-document shipments to help prevent

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clearance delays. It should be presented in Spanish, however if in English, the Spanishtranslation should appear right below the English text.

Packing List - Required for most goods and should preferably be in Spanish. The importof some goods in bulk form (i.e. Coal, sand etc.) Do not require this document.

Certificate of Origin - A Certificate of Origin is required by the Government ofArgentina for certain products such as textiles and footwear as well as for products andparts produced in countries that are not members of the World Trade Organization(WTO).

Additional documentation is required in the form of permits, licenses or productcertification for goods such as (and not limited to) food, pharmaceuticals, chemicalproducts, cosmetics, agricultural products, textiles and defence material.

Customs Valuation

All goods shipped to Argentina must have a value and description. The value is usuallybased on the transaction value between the shipper and the importer, what the sale valuesof the goods were. If no actual transaction has taken place, such as with samples or a nocharge shipment, a value must still be assessed; this would be the fair market value orreplacement value. Non-tangible items such as a business documents, accountingdocuments, etc. must also be assessed a value, but this should be based on the value ofthe paper.

Import Duties

All imported goods are subject to an ad valorem duty that is based on the cost of thegoods, plus insurance and freight (CIF).

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Antidumping

Customs will assess antidumping duties on imported goods sold in Argentina at less thanthe normal price of the goods in the manufacturer's home market (also called fair marketvalue). Specific information regarding commodities that are subject to anti-dumpingduties can be found at the Commission National de Comercio Exterior website athttp://www.mecon.gov.ar/cnce/

Excise Duties

Alcoholic beverages, tobacco, soft drinks, syrups, extracts, concentrates and consumerelectronic products are subject to luxury and excise taxes.

Additional Duties

Countervailing duties are assessed to some goods to counter the effects of subsidiesprovided by the foreign government for goods exported to Argentina resulting inartificially low prices that have a detrimental impact on Argentine industries. Specificinformation regarding commodities that are subject to countervailing duties can be foundat the Comision Nacional de Comercio Exterior website athttp://www.mecon.gov.ar/cnce/

Import Taxes

In addition to the tariffs, imported goods are subject to additional fees and taxes such as:

0.5 percent statistics fee on the CIF value (except capital goods). This tax is notlevied on trade between MERCOSUR member countries.

Depending on the product, either 21 or 10.5 percent value added tax (VAT) on thesum of the CIF value, tariff and statistics fee.

Depending on the product, either 10 or 5.5 percent advanced VAT on the sum ofthe CIF value and statistics fee on all goods imported for resale (goods importedby the end-user are exempt).

3 percent anticipated profits tax on all retail goods (goods imported by the end-user are exempt).

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Customs Fees

A $10.00 USD single fixed customs fee is assessed per transaction entered using theSistema Informatico Maria (SIM). Merchandise imported using the Simplified ImportSystem is exempt from this fee.

Exchange Controls

Exchange controls are currently imposed by the government of Argentina.

Technical Barriers to Trade (TBT's)

Technical barriers or non-tariff barriers to trade, as they are sometimes known as, cancause many problems for exporters looking for new markets for their products. Thesebarriers can be in the form of regulations, standards, testing and certification procedures.The World Trade Organization (WTO) Agreement on Technical Barriers to Trade tries toensure that these barriers do not create unnecessary obstacles. To obtain furtherinformation on Technical Barriers to Trade as well as Notifications on technicalregulations and conformity assessment procedures, go to the WTO website athttp://www.wto.org/english/tratop_e/tbt_e/tbt_e.htm

Consular Fees

Legalization of shipping documents is generally not required as a condition of entry ofgoods into Argentina.

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General Import Clearance Information

Inspection

Minimum import prices replaced the pre-shipment inspection requirement in its entiretyon December 25, 2001 under Resolution 1004/2001.

Registration Requirements

Companies wishing to import products into Argentina must be registered in the NationalRegistry of Importers and Exporters.

Companies wishing to import through an optional customs clearance method establishedby Decree 161/99 and Resolution AFIP 503/99 called the "Simplified ImportationSystem" must provide the companies tax payer number known as the Clave Unica deIdentification Tributaria [CUIT]. Commercial shipments consigned to, or shipped from[when exporting from Argentina] private individuals must provide the Clave Unica deIdentification Laboral [CUIL] number.

Tariff classification

On January of 1995, Argentina implemented the MERCOSUR Common Nomenclature,which is aligned with the Harmonized System of Nomenclature and is utilized for tariffclassification.

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Argentina Import Prohibition

The following commodities are prohibited into Argentina:

Used products such as (and not limited to):o Spare partso Medical supplieso Automobileso Motorcycles and Velocipedeso Clothingo Tireso Boats

Dangerous residues (chemicals) Certain toxic substances contained in pharmaceutical products, cosmetics and toys Certain food additives and colorants Products containing polychlorinated biphenyl's (PCB's) Asbestos fibres of the Amphibole and Chrysotile variety (Crocidolite, Amosite,

Actinolite, Antofilite and Trimolite) and products containing these fibres.

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General Import Restriction

The following items are not acceptable for carriage to any international destinationsunless otherwise indicated. (Additional restrictions may apply depending on destination.Various regulatory clearances in addition to customs clearance may be required forcertain commodities, thereby extending the transit time.)

1. APO/FPO addresses.2. C.O.D. shipments.3. Human corpses, human organs or body parts, human and animal embryos, or

cremated or disinterred human remains.4. Explosives (Class 1.4 explosives are acceptable for carriage to Canada, Germany,

France, Japan, United Arab Emirates and United Kingdom. Note: United ArabEmirates only allows Class 1.4 explosives to be shipped hold-for-pickup to theFedEx Express facility in Dubai).

5. Firearms, weaponry and their parts (acceptable between the U.S. and PuertoRico).

6. Perishable foodstuffs and foods and beverages requiring refrigeration or otherenvironmental control.

7. Live animals including insects, except as provided in the Live Animals section inthe FedEx Service Guide. (Call the FedEx Live Animal Desk at 1.800.405.9052).

8. Plants and plant material, including cut flowers (cut flowers are acceptable fromthe U.S. to selected points in Canada and from Colombia, Ecuador and theNetherlands to the U.S.).

9. Lottery tickets and gambling devices where prohibited by law.10. Money (coins, cash, currency, paper money and negotiable instruments equivalent

to cash such as endorsed stocks, bonds and cash letters).11. Pornographic and/or obscene material.12. Shipments being processed under:

a. Duty drawbacks claim unless advance arrangements are made.b. Temporary Import Bonds – acceptable under the FedEx International

Broker Select option, for initial import only.c. U.S. State Department licensesd. Carnetse. U.S. Drug Enforcement Administration export permit.f. Letters of Credit. Shipments subject to Letters of Credit are generally

prohibited, with the exception of shipments subject to Letters of Creditcalling for a “courier receipt”, as defined by Article 25 of UCP 600,shipped using the FedEx Expanded Service International Air Waybill.

112

g. Certificate of Registration shipments (CF4455).

13. Hazardous waste, including, but not limited to, used hypodermic needles orsyringes or other medical waste.

14. Shipments that may cause damage to, or delay of, equipment, personnel or othershipments.

15. Shipments that require us to obtain any special licenses or permit fortransportation, importation or exportation.

16. Shipments or commodities whose carriage, importation or exportation isprohibited by any law, statute or regulation.

17. Shipments with a declared value for customs in excess of that permitted for aspecific destination.

18. Dangerous goods except as permitted under the Dangerous Goods section of theseterms and conditions.

19. Processed or unprocessed dead animals, including insects and pets. Taxidermy-finished hunting trophies or completely processed (dried) specimens of wholeanimals or parts of animals are acceptable for shipment into the U.S.

20. Packages that are wet, leaking or emit an odor of any kind.21. Wildlife products that require U.S. Fish and Wildlife Service export clearance by

FedEx prior to exportation from the U.S.22. In-bond shipments destined to or being withdrawn from a Foreign Trade Zone or

bonded warehouse, unless the FedEx International Broker Select option isselected for U.S. import shipments or the FedEx International Controlled Exportservice option is selected for U.S. export shipments.

Notwithstanding any other provision of the FedEx Service Guide, we are not liable fordelay of, loss of damage to a shipment of any prohibited item. The shipper agrees toindemnity FedEx for any and all costs, fees and expenses FedEx incurs as a result of theshipper’s violation of any local, state or federal laws or regulations or from tendering anyprohibited item for shipment.

113

Argentina Restriction

Currently the Government of Argentina imposes quotas for the importation of peaches,white glasses for corrective spectacles, automobile parts, paper, pulp and footwear.

Pharmaceuticals, chemical products, insecticides, veterinary products, medical devices,cosmetics, agricultural products, textiles and defence material require various approvalsprior to import from various regulatory agencies.

The following commodities are prohibited via FedEx International Priority (IP) servicesinto Argentina. However, you may be able to use another FedEx service for shippingthese items. For additional shipping options, please contact your local FedEx customerservice representative.

Airline tickets, blank stock Antiques Bearer bonds Collectable coins Blank credit cards Credit cards, other than telephone cards Firearms, parts Poisons (toxics) Non-negotiable stocks Blue ice Radioactive and explosive material

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Special Import Provisions

Free Trade Zones

Argentine Law authorizes the Federal Government to create one Free Trade Zone (FTZ)in each province and it delegates to the executive branch the authority to create theforeign trade or export processing zones.

There are currently 10 FTZ's in Argentina:

La Plate Free Trade Zone (ZFLP) San Luis Free Trade Zone Cordoba Free Trade Zone Tucuman Free Trade Zone Mendoza Free Trade Zone Santa Fe Free Trade Zone Comodoro Rivadavia Free Trade Zone Salta Free Trade Zone Misiones Free Trade Zone La Pampa Free Trade Zone

In addition to the free trade zones, Tierra del Fuego has a Special Customs Arearegime, which allows duty-free entry of cap goods not produced in Argentina with anend use in designated high-priority industry as well as for assembly in local plantsand sale in Argentina. Other imports through this area receive a 50 percent reductionon normal tariff rates. This area will continue to function until 2013 for non-blocgoods.

Personal Effects

Personal working items such as computers or tools of the trade must be registered withcustoms at the time of entry and again upon departure from Argentina.

115

Samples

Samples sent by parcel post or in other ways are treated the same as any othercommercial shipment and have the same documentary requirements. The services ofcustomhouse brokers are generally not necessary to clear shipments of samples with orwithout value.

Gifts

Articles imported as gifts may be subject to duties and taxes (donations to duly registeredrelief organizations may enter free of duties and taxes when accompanied by aCertificado de Donacion obtained from the Argentine Consulate prior to shipping).

116

General Export Clearance Information

Clearance Process

Exporting from Argentina requires knowledge of the commodity, the properdocumentation and export compliance. The value of the goods, destination of theshipment and if the goods are controlled, prohibited or regulated will determine thespecific export requirements.

Export Duties

Commodities exported from Argentina are subject to duties, which range from 5% to20% (they vary per product type) of the FOB value of the commodity.

Embargoed Countries

Argentina has been a member state of the United Nations since October 24, 1945, and assuch honours any import or export sanctions imposed against designated countries underthe United Nations Act 1946.

Registration requirements

Exporters should be registered with the Department of Trade and Industry (DTI) or theSecurities and Exchange Commission (SEC): with the city or the municipality where thebusiness will operate, as well as with the Bureau of Internal revenue.

Document Requirements

Export documentation requirements vary on the type of goods being exported. Goods thatare controlled or restricted for export may require licenses or specific certifications inaddition to an air waybill and commercial invoice.

117

Argentina Export Prohibitions

The following commodities are prohibited out of Argentina:

Logs Certain works of art Certain products of endangered species

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General Export Restriction

The following items are not acceptable for carriage to any international destinationsunless otherwise indicated. (Additional restrictions may apply depending on destination.Various regulatory clearances in addition to customs clearance may be required forcertain commodities, thereby extending the transit time.)

1. APO/FPO addresses.2. C.O.D. shipments.3. Human corpses, human organs or body parts, human and animal embryos, or

cremated or disinterred human remains.4. Explosives (Class 1.4 explosives are acceptable for carriage to Canada, Germany,

France, Japan, United Arab Emirates and United Kingdom. Note: United ArabEmirates only allows Class 1.4 explosives to be shipped hold-for-pickup to theFedEx Express facility in Dubai).

5. Firearms, weaponry and their parts (acceptable between the U.S. and PuertoRico).

6. Perishable foodstuffs and foods and beverages requiring refrigeration or otherenvironmental control.

7. Live animals including insects, except as provided in the Live Animals section inthe FedEx Service Guide. (Call the FedEx Live Animal Desk at 1.800.405.9052).

8. Plants and plant material, including cut flowers (cut flowers are acceptable fromthe U.S. to selected points in Canada and from Colombia, Ecuador and theNetherlands to the U.S.).

9. Lottery tickets and gambling devices where prohibited by law.10. Money (coins, cash, currency, paper money and negotiable instruments equivalent

to cash such as endorsed stocks, bonds and cash letters).11. Pornographic and/or obscene material.12. Shipments being processed under:

a. Duty drawbacks claim unless advance arrangements are made.b. Temporary Import Bonds “acceptable under the FedEx International

Broker Select option, for initial import only.c. U.S. State Department licensesd. Carnetse. U.S. Drug Enforcement Administration export permit.f. Letters of Credit. Shipments subject to Letters of Credit are generally

prohibited; with the exception of shipments subject to Letters of Creditcalling for a courier receipt as defined by Article 25 of UCP 600, shippedusing the FedEx Expanded Service International Air Waybill.

g. Certificate of Registration shipments (CF4455).

13. Hazardous waste, including, used hypodermic needles or syringes or other medialwaste.

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14. Shipments that may cause damage to, or delay of, equipment, personnel or othershipments.

15. Shipments that require us to obtain any special licenses or permit fortransportation, importation or exportation.

16. Shipments or commodities whose carriage, importation or exportation isprohibited by any law, statute or regulation.

17. Shipments with a declared value for customs in excess of that permitted for aspecific destination.

18. Dangerous goods except as permitted under the Dangerous Goods section of theseterms and conditions.

19. Processed or unprocessed dead animals, including insects and pets. Taxidermy-finished hunting trophies or completely processed (dried) specimens of wholeanimals or parts of animals are acceptable for shipment into the U.S.

20. Packages that are wet, leaking or emit an odour of any kind.21. Wildlife products that require U.S. Fish and Wildlife Service export clearance by

FedEx prior to exportation from the U.S.22. In-bond shipments destined to or being withdrawn from a Foreign Trade Zone or

bonded warehouse, unless the FedEx International Broker Select option isselected for U.S. import shipments or the FedEx International Controlled

Export service option is selected for U.S. export shipments.

Not withstanding any other provision of the FedEx Service Guide, we are not liable fordelay of, loss of damage to a shipment of any prohibited item. The shipper agrees toindemnity FedEx for any and all costs, fees and expenses FedEx incurs as a result of theshipper violation of any local, state or federal laws or regulations or from tendering anyprohibited item for shipment

120

Argentina Export Restriction

The following commodities are prohibited via FedEx International Priority (IP) servicesout of Argentina. However, you may be able to use another FedEx service for shippingthese items. For additional shipping options, please contact your local FedEx customerservice representative.

Airline tickets, blank stock Antiques Bearer bonds Collectable coins Blank credit cards Credit cards, other than telephone cards Firearms, parts Poisons (toxics) Non-negotiable stocks Blue ice Radioactive and explosive material

Certain commodities may be subject to export controls, which may requireadditional documentation such as:

Export Licensing for Dual Use Goods (goods that may be used in either militaryor civilian application) which are controlled by the Commission Nacional deControl de Exportaciones Sensitivas y Material Belico (CONCESYMB). Thecommission consists of an integration of the Foreign Ministry, the Ministry ofDefence and Argentine Customs.

Sanitary, phytosanitary or safety standard certification for products such as meat,seeds, fruit, vegetables and marine goods.

Additional products that are controlled for export include psychotropic substancesand endangered fish and wildlife species.

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Comparison of Argentina and India Export of Goods and Services

Exports of goods and services represent the value of all goods and other market servicesprovided to the rest of the world. They include the value of merchandise, freight,insurance, transport, travel, royalties, license fees, and other services, such ascommunication, construction, financial, information, business, personal, and governmentservices. They exclude compensation of employees and investment income (formerlycalled factor services) and transfer payments.

Year India Argentina2002 14.5 27.72003 15.7 252004 17.6 25.32005 19.1 24.82006 21.1 24.62007 20.4 24.52008 23.8 242009 19.8 21.42010 21.5 21.7

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Comparison of Argentina and India Import of Goods and Services

Imports of goods and services represent the value of all goods and other market servicesreceived from the rest of the world. They include the value of merchandise, freight,insurance, transport, travel, royalties, license fees, and other services, such ascommunication, construction, financial, information, business, personal, and governmentservices. They exclude compensation of employees and investment income (formerlycalled factor services) and transfer payments.

Year India Argentina2002 15.5 12.82003 16.1 14.22004 19.3 18.22005 22.0 19.22006 24.2 19.22007 24.4 20.32008 28.9 20.72009 25.1 16.02010 24.8 18.4

0

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30

2002 2003 2004 2005 2006 2007 2008 2009 2010

India

Argentina

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Comparison of Argentina and India GDP growth (Annual %)

Annual percentage growth rate of GDP at market prices based on constant local currency.Aggregates are based on constant 2000 U.S. dollars. GDP is the sum of gross value addedby all resident producers in the economy plus any product taxes and minus any subsidiesnot included in the value of the products. It is calculated without making deductions fordepreciation of fabricated assets or for depletion and degradation of natural resources.

0

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30

35

2002 2003 2004 2005 2006 2007 2008 2009 2010

India

Argentina

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Year India Argentina2002 3.8 10.92003 8.4 8.82004 8.3 92005 9.3 9.22006 9.3 8.52007 9.8 8.72008 5.2 6.82009 9.1 0.92010 8.8 9.2

0

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2002 2003 2004 2005

India

Argentina

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RURAL SECTOR OF ARGENTINA

Introduction

Argentina benefits from rich natural resources, a highly literate population, an export-oriented agricultural sector, and a diversified industrial base. Although one of the world'swealthiest countries 100 years ago,

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the country has a variety of natural resources including lead, zinc, copper, iron petroleum,uranium, and rich agricultural areas.

In the early 1990s Argentina underwent an economic boom period.

By 1997, GDP growth had reached 8 percent per year. Reforms in the economy led toincreased competition and output. These reforms also attracted significant new foreigninvestment.

However, after repeated periods of military dictatorship, the nation faced a variety ofeconomic problems when the first sustained period of civilian control of the governmentbegan in 1983.

By 1989, the nation had an enormous external debt, and inflation had reached a level of200 percent per month..

Between 1992 and 1999, exports more than doubled from US$12 billion to US$25billion. In overall terms, international trade remains only a small part of the Argentineeconomy.

In 1998, the nation began a severe recession that ended in 2000. In 1999, GDP fell by 3percent, but by 2000 growth had returned at a 2 percent annual rate. However,unemployment in the nation continues to be problematic. Unemployment peaked in 1995at 18.4 percent. The strongest areas of the Argentine economy are telecommunications,food processing, banking, energy production, and mining. Food processing aloneaccounted for 23 percent of GDP in industry in 1998 and is one of the few areas in whichArgentina has a trade surplus.

In 1995 Argentina, Brazil, Chile, and Uruguay created a free trade area namedMERCOSUR. The trade organization has dramatically lowered tariffs between themember nations with reductions in some tariffs of 100 percent. Argentina accounts for 27percent of MERCOSUR's total GDP. Brazil is now Argentina's largest trading partner.Argentina's exports to MERCOSUR countries are expected to continue to increase and tohelp spur the economy.

GDP growth (8.5 pct) recovered strongly in 2010 and is expected to continue albeit moremoderately (5.3 pct) in 2011, with strong demand from Argentina's main markets, Brazil andChina, supporting export-oriented activity.

Tension between Argentina and the IMF - particularly due to the unresolved issue of thedebt renegotiation - led to the postponement of the stand-by agreement in August 2004.

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Negotiations with the IMF resumed following a successful debt swap in February 2005and the US$9.5 billion owed to the IMF was repaid in January 2006.

Argentina successfully renegotiated its large debt with the majority of private creditors in2005 and 2010.

Argentina – Rural Sector

The rural life in the country that outstands for its huge lands and agricultural and cattle breedingtradition. Every region features rural establishments, although the highest concentration is foundin Buenos Aires, Mendoza and Patagonia, mainly in the province of Santa Cruz. Each one hascharacteristics and options closely related to its physical environment, offering visitors thechance of enjoying natural landscapes mingled with typical food and rural culture.

The rural sector is important for the macro economy and micro economy in Argentina.Agriculture and agro based industry account for 57 percent of all exports, 36 percent ofemployment, and 18 percent of GDP. The rural poor and non poor receive the largestshare of their total income—54 and 68 percent respectively—from agricultural activitiessuch as farming and agricultural labor. The rural nonfarm sector is also important forincome and employment. The poor and non poor in dispersed rural areas receive less than20 percent of their total income nonfarm.Some of the important aspects of rural sectors are as follows :-

1) Poverty2) Literacy3) Agriculture4) Population

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Poverty

In Argentina

Poverty rate for middle income class 33 %

Poverty in rural according to UBN 19 %

% of rural population out of total 11 %

Year % of poverty Year % of poverty

1991 30 1992-96 37

2001 33 2000 30

2003 19 2004-08 28

In 2001, rural poverty is significantly higher in rural areas than in urban areas. Onepoverty indicator such as unmet basic needs (UBN) reveals that; 33 percent of the ruralpopulation in Argentina have UBN—compared 14 percent in urban areas. By the incomemeasure of extreme poverty nearly 40 percent of rural households are in extreme poverty,compared to just over 30 percent in urban areas.2 The rural extreme poor account around1.2 million people or around 200,000 households.

In India

The Indian family unit is often large, which can amplify the effects of poverty. Also, thecaste system still prevails in India, and this is a major reason for rural poverty - peoplefrom the lower casts are often deprived of the most basic facilities and opportunities. The

0

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20

30

40

2003 2001 1991

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Poverty

In Argentina





1991 30 1992-96 37

2001 33 2000 30

2003 19 2004-08 28


In India


1991

128

Poverty

In Argentina





1991 30 1992-96 37

2001 33 2000 30

2003 19 2004-08 28


In India


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government has planned and implemented poverty eradication programs, but the benefitsof these programs are yet to bear fruits.Since its independence, the issue of poverty within India has remained a prevalentconcern.

% of population living below poverty line 37 %

% rural population in difficult physical and financial predicament. 22 %

% urban population in difficult physical and financial predicament. 15 %

Conclusion: Poverty data of both countries on 2003 shows data India had less povertythan Argentina. But during 1990-1996 Argentina was in better position.

Literacy

literacy has been commonly defined as the ability to read and write at an adequate levelof proficiency that is necessary for communication. More recently however, literacy hastaken on several meanings. Technological literacy, mathematical literacy, and visualliteracy are just a few examples. While it may be difficult to gauge the degree to whichliteracy has an impact on an individual’s overall happiness, one can easily infer that anincrease in literacy will lead to the improvement of an individual’s life and the

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jan 92-96 Jan-00 jan 04-08

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development of societies. A survey recently published by UNICEF stated that 9.2% ofchildren in Argentina are born to an illiterate or severely undereducated mother. Thefindings, from their annual study ‘The State of the World’s Children’, seem shocking fora country which supposedly has the highest literacy rate in the continent.

Year Literacy(Argentina)

Year Literacy(India)

1940 77 1990 41

1960 82 1998 42

1990 87 2001 58

2011 62

While in developed nations, the majority of the population over the age of 17 possessesbasic literacy skills in reading and writing,

Below diagram shows the literacy rate of rural Argentina in 20th century

In Argentina

In India

Literacy rate of India has shown as improvement of almost 9 percent, As perPopulation Census of India 2011. It has gone up to 74.04% in 2011 from 65.38%in 2001, thus showing an increase of 9 percent in the last 10 years. Bihar with63.08% literacy rate is the last in terms of literacy rate in India.

70

75

80

85

90

1990 1960 1940

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Male literacy rate 82.14 %

Female literacy rate 65.46 %

% of rise in literacy rate in 2011 from 2001 8.66 %

State having top literacy rate Kerala (93.9 %)

Lakshadweep and Mizoram are at second and third position 92.3 & 91.06 %

Conclusion: In literacy rate India was always behind Argentina and presently alsoArgentina has literacy rate of more than 90%.

Agriculture

In Argentina

Argentine agriculture is relatively capital intensive, today providing about 7% of allemployment, and, even during its period of dominance around 1900, accounting forno more than a third of all labour. Having accounted for nearly 20% of GDP as late as1959, it adds, directly, less than 10% today. Agricultural goods, however, whetherraw or processed, still earn over half of Argentina's foreign exchange and, arguably,remain an indispensable pillar of the country's social progress and economicprosperity.

Employment provided by agriculture 7 %Contribution to GDP in 1959 20 %Foreign owned farmland 10 -15 %Amt of exports (one fourth amount), were composed ofunprocessed agricultural primary goods, mainly soybeans,wheat and maize.

US 86 billion (2011)

0

50

100

1990

131







Agriculture

In Argentina




1990 1998 2001 2011

131







Agriculture

In Argentina




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Year Agriculture(Argentina)

Year Agriculture(India)

1960-64 - 1950-51 51

1965-69 9 1965 42

1970-74 11 1976 38

1975-79 7 1985 32

In India

Agriculture in India is a major economic sector and it creates plenty of employmentopportunities as well.

India agriculture has an extensive background which goes back to 10 thousandyears.

At present, in terms of agricultural production, the country holds the secondposition all over the world.

In 2007, agriculture and other associated industries such as lumbering and forestryrepresented around 16.6% of the Gross Domestic Product of the country. Inaddition, the sector recruited about 52% of the entire manpower.

Regardless of the fact that there has been a gradual slump in its contribution to thegross domestic product of the country, India agriculture is currently the biggestindustry in India.

0

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10

15

1960-64 1965-69

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1960-64 - 1950-51 51

1965-69 9 1965 42

1970-74 11 1976 38

1975-79 7 1985 32

In India






1965-69 1970-74 1975-79

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1960-64 - 1950-51 51

1965-69 9 1965 42

1970-74 11 1976 38

1975-79 7 1985 32

In India






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Contribution to GDP

Conclusion: so the above data shows that contribution Indian agriculture is far more thanthe Argentina’s.

Population

It refers to the total number of people living within a defined area, or it can refer to agroup of people from defined areas that have similar characteristicsThe structure of a population describes the relative numbers of people with similarcharacteristics within a population, for example, age groups, sex, and ethnicity. Thestructure of a population shows how the subgroups within it affect its composition andcharacteristics. For example, it shows the percentages making up the different age groupsof the population.

Year Population(Argentina)

Year Population(India)

2001 9.64 2001 72.10

2002 9.38 2002 71.90

2003 9.12 2003 71.70

2004 8.86 2004 71.50

2005 8.6 2005 71.30

2006 8.4 2006 71.02

2007 8.2 2007 70.74

2008 8 2008 70.46

2009 7.8 2009 70.18

2010 7.7 2010 69.90

Population structure changes over time as people age, but also because of births, deaths

0

20

40

60

1950/51 1965 1976 1985

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and migration. Changes to social, environmental and economic conditions can alsoinfluence population structure. Total population of Argentina as estimated in the year2006 in the month of July was about 39,921,833 persons. Majority of the populationresides in the Buenos Aires province. Only 0.5 5 of the total population comprises of theindigenous population of Argentina. These people are the Collas, Mapuches, Tobas,Chiriguanos and Matacos.The current population of Argentina is around 36 million of which almost half live in theprovince of Buenos Aires

In Argentina

Population as per % of total population

In India

India, with 1,220,200,000 (1.22 billion) people is the second most populous country inthe world.While China is on the top with over 1,350,044,605 (1.35 billion) people.

The figures show that India represents almost 17.31% of the world's population, whichmeans one out of six people on this planet live in India.Although, the crown of the world's most populous country is on China's head for decades,India is all set to take the numero-uno position by 2030. With the population growth rateat 1.58%, India is predicted to have more than 1.53 billion people by the end of 2030.

More than 50% of India's current population is below the age of 25.

And over 65% below the age of 35. About 72.2% of the population lives in some 638,000 villages and the rest 27.8%

in about 5,480 towns and urban agglomerations.

0.00

2.00

4.00

6.00

8.00

10.00

12.00

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

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Population as per % of total population

Conclusion: Major issue of India was always been its population, it is world’s secondmost populated country.

Overview of Trade & Commerce:

Argentina benefits from rich natural resources, a highly literate population, an Export-oriented agricultural sector, and a diversified industrial base. Although one of the world'swealthiest countries 100 years ago, Argentina suffered during most of the 20th centuryfrom recurring economic crises, persistent fiscal and current account deficits, highinflation, mounting external debt, and capital flight. A severe depression, growing publicand external indebtedness, and a bank run culminated in 2001 in the most seriouseconomic, social, and political crisis in the country's turbulent history. Interim PresidentAdolfo RODRIGUEZ SAA declared a default - the largest in history - on thegovernment's foreign debt in December of that year, and abruptly resigned only a fewdays after taking office. His successor, Eduardo DUHALDE, announced an end to thepeso's decade-long 1-to-1 peg to the US dollar in early 2002. The economy bottomed outthat year, with real GDP 18% smaller than in 1998 and almost 60% of Argentines under

68.50

69.00

69.50

70.00

70.50

71.00

71.50

72.00

72.50

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

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the poverty line. Real GDP rebounded to grow by an average 8.5% annually over thesubsequent six years, taking advantage of previously idled industrial capacity and labor,an audacious debt restructuring and reduced debt burden, excellent international financialconditions, and expansionary monetary and fiscal policies. Inflation also increased,however, during the administration of President Nestor KIRCHNER, which respondedwith price restraints on businesses, as well as export taxes and restraints, and beginning inearly 2007, with understating inflation data. Cristina FERNANDEZ DE KIRCHNERsucceeded her husband as President in late 2007, and the rapid economic growth ofprevious years began to slow sharply the following year as government policies held backexports and the world economy fell into recession. The economy has rebounded stronglyfrom the 2009 recession, but the government's continued reliance on expansionary fiscaland monetary policies risks exacerbating already high inflation.

Definition: This entry briefly describes the type of economy, including the degree ofmarket orientation, the level of economic development, the most important naturalresources, and the unique areas of specialization. It also characterizes major economicevents and policy changes in the most recent 12 months and may include a statementabout one or two key future macroeconomic trends

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Present Trade Relations and Business Volume of different products with India

Argentina has world's third largest shale gas reserves.

IFFCO of India has invested 25 million dollars in a Canadian company AmericasPetrogas which has a shale gas block in Argentina. They are looking for financial andtechnological partners for exploration and production.

Energy

Argentina is a pioneer and largest user of CNG technology. Argentine companies havebeen exporting CNG conversion kits and technology to many countries. Galileo, a leaderin Argentina in CNG sector has supplied technology and equipments to India.

Industry

The Argentine manufacturing industry is relatively large and diversified. It is strong infood processing, automobiles, auto parts, consumer goods, pharmaceuticals, paper andmetallurgy.Argentina ’s industrial production include :

o 660,000 automobileso 5.1 million tons of steelo 465,000 tons of aluminiumo 1.2 million tons of papero 1.9 million tons of sugaro 170,000 tons of PVCo 540,000 tons of polyethylene

In 2008, 743,000 motorcycles were sold in Argentina, 9% more than in 2007 . Only50,000 units (7%) were of national production, another 33% (245,000) were locallyassembled and the other 447,000 were imported complete from China (most of them),Brazil, Japan and Taiwan

Autoproduction by companies in 2010

Peugeot –Citroen 140000 General Motors - 110000 Ford - 95000 Toyota - 85000 Volkswagen - 72000

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Fiat – 57000

60 percent of automobiles produced in Argentina are exported.

Forty percent of parts used in vehicle manufacturing plants in Argentina are locally made.

Pharmaceuticals

The Argentine pharmaceutical market is valued at 4.2 billion dollars. There are 110laboratories in the country, of which 17 are international laboratories and the rest arenational. Market leaders are Bayer, Bagó and Roemmers. Foreign companies have ashare of 54% of the market while the local companies control 46%. Exports in 2010 were800 million dollars. Most of the exports go to Latin America.

The top ten pharma companies are :Roemmers, Bagó, Ivax Argentina, Gador, Elea, Sanofi Aventis, Bayer, Montpellier,Pfizer and Phoenix.

The Argentine regulatory agency ANMAT allows import of pharmaceuticals only from26 countries mentioned in the Presidential Decree 150 of 1992. Since India is not in thislist, imports are not possible. The Government of Argentina has been requested to includeIndia in their list. However, Argentine companies import substantial quantities of bulkdrugs from India.

Textile Industry

Latest information on Argentine Textle Industry and Argentine imports of IndianTextiles.

Banking

The banking sector of Argentina after having gone through the turmoil during the crisis in2002 is now on a more stable foundation through better regulatory measures, reforms andmergers.

Top ten banks (in the order of their ranking)

1. BANCO DE LA NACION ARGENTINA www.bna,com,ar2. BANCO DE LA PROVINCIA DE BUENOS AIRES www.bapro.com.ar3. BANCO GALICIAwww.bancogalicia.com.ar4. BANCO SANTANDER RIOwww.bancorio.com.ar5. BANCO FRANCÉSwww.bancofrances.com.ar6. BANCO CIUDAD DE BUENOS AIRESwww.bancociudad.com.ar7. BANCO MACROwww.bansud.com.ar8. BANCO HSBCwww.hsbc.com.ar

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9. BANCO HIPOTECARIOwww.bancohipotecario.com.ar10. BANCO CREDICCOPwww.crediccop.com.ar

India - Argentina Business

Bilateral Trade figures for 2011

(in million dollars)

Argentina

Jan-Sep 2011 Jan-Sep 2010



Argentina

2010 2009



USD in million)

Year 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000India’sexports

496 342 492 384 303 261 160 136 85 151 143

India’simports

2032 876 836 859 929 739 567 558 404 446 442

The trade is very much below the potential. During the visit of the President of Argentinato India in October 2009, the two Governments set a target of 3 billion dollars of bilateraltrade by 2012.

Exports from India to Argentina (2010)

Items In million US $Organic chemicals 164Lubricants 49Vehicles and autoparts 42

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Machinery 30Sound and image divices 24Synthetic Fibers 18Garments 16Bulk drugs 15Dyes 13Iron and steel 12Plastics 11Cotton yarn 11Rubber manufactures 9Optical instruments 5Minerals and gems 4Handicrafts 3.5Carpets and rugs 3Saddlery 2.5Leather products 2.2Artificial jewellery 1.5Inorganic chamicals 1.2

Imports of India from Argentina (2010)

Items In million US $Soybean oil 1843Sunflower oil 36Leather 30Air pumps and compressors 16Sugar 15Corn 13Ferroalloys 9Wool 7Cosmetics 5.2Photography products 5Water pumps 4.5Salt and derivates 4Dyes for leather industry 3.8Precision instruments 3.6Pharmaceuticals 2Iron and Steel 1.7Candies 1.4

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Cargil Molinos Rio de la Plata Vicentin Luis Dreyfus AGD

Exports

Indian exporters are invited to explore the potential for exports to Argentina. There isscope for increasing the volume of items already exported as well as for new items. Theseare: vehicles, two-wheelers, auto parts, machinery including for sugar industry andrailways, solar and wind energy, chemicals, inputs for agriculture, agrochemicals, bulkdrugs, dyestuff, textiles and handicrafts.Indian brands have started making their mark in Argentina.

Mahindra Tractors and Royal Enfield Motorcycles were launched in Argentine market inMarch 2009. Bajaj motor cycles are sold in Argentina.

Imports

India’s imports of soy and sunflower oil as well as copper are expected to increasesteadily in the years to come. Wheat would be an import item as and when there isshortfall in Indian production. Argentine companies have been supplying CNG kits toIndia, wine, wool, leather, olives and dried vegetables and fruits.

Argentina has the potential for contributing to India’s food security in future. At present,Argentina is a major source of edible oils for India. According to the Solvent ExtractorsAssociation of India (SEA), the requirement of edible oils in 2006 was 12 million tons ofwhich 7 million were produced domestically and 5 million was imported. Imports shot upto over 7 million tons in 2009. In 2010, the requirement of edible oils is expected toincrease to 15 million tons and more in the years to come. But the production of oilseedsin India cannot match the demand and India will continue to be a long term importer ofedible oils. In this respect, India can count on Argentina as a reliable source. Argentina isthe world’s largest exporter of soya oil and sunflower oil. Argentina has the third largestcapacity for edible oil processing after China and USA.

India has imported wheat from Argentina from time to time, including purchase of 44million dollars in 2008. Besides edible oil and wheat, Argentina can be a new source ofpulses. India imports about 3 million tons of pulses from countries such as Myanmar,Australia, Turkey and Canada. Although. India does not import any pulses fromArgentina at present, the Argentine soil is suitable for cultivation of pulses of interest to

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India. The Argentine agribusiness companies are willing to grow these, attracted by thelarge and growing market in India.

It is advisable for Indian companies to think beyond imports and go in for acquisition ofland in Argentina to grow oil seeds, wheat and pulses. There is no restriction on foreigninvestment in land in Argentina. A number of foreign companies and individuals ownthousands of hectares of land. Sterling Group of NRI Sivasankaran has acquired an olivefarm of 1700 hectares in the Catamarca province of Argentina. A Non-Resident Indiancompany ‘Olam’ has leased 17,000 hectares of land in Argentina to produce peanuts.Encouraged by the success of this venture, they are now planning to grow wheat, soyaand pulses with additional leasing of land. Land is available in lots of hundreds andthousands of hectares. SEA had sent two delegations to Argentina (also Uruguay,Paraguay and Brazil) in 2006 and 2007 to study the possibility of acquisition of land forproduction of oilseeds. They have already formed a consortium of 14 companies whichproposes to invest in agricultural land in the region. To start with, they have a plan toinvest 40 million dollars in Uruguay. Besides SEA of India and STC, private sectorgroups have also shown interest in acquisition of land in Argentina.

India is going to be under more pressure for agricultural land in future. India´spopulation increases by 15 million every year and it adds a new Argentina (40 million)every 32 months. On the other hand, agricultural land is diminishing because of theincreasing use for residential, industrial and commercial purposes. This is in contrast withArgentina which has a small population of 40 million with an area almost equal to that ofIndia. Besides the large area, the Argentine productivity of grains and oilseeds are threetimes that of India. For example, average yield per hectare of soya in India is 900 kgwhile the Argentine average is 3 tons. In India, the subsistence farmers with their averageland holding of just a few acres are unable to invest and increase productivitysignificantly. But the Argentine farmers who hold thousands of hectares of land dofarming commercially and professionally and are able to invest in innovation andproductivity.

Argentina can also contribute, to a small extent, to India´s energy security. Argentine oilresources are under-explored. They have 2 billion barrels of discovered reserves and arecurrently producing 800,000 bpd. They are just starting off-shore exploration and the landarea has not been fully explored. Indian oil companies in public and private sector couldmake entry here. Reliance has formed a joint venture with an Argentine private companyPluspetrol (along with an Australian company Woodside) and their consortium has wonconcessions in Peru and Bolivia for oil and gas exploration. They are also exploringopportunities in Argentina and in other countries of the region. ONGC Videsh Ltd.(OVL) has signed an MOU with their Argentine counterpart ENARSA and jointly seekopportunities in Argentina and in this region.

Argentina is the third largest exporter of bio-diesel in the world. They exported over onemillion tons in 2008 and are increasing production capacity to 1.6 million tons by 2010.India can also consider imports from Argentina.

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There are thousands of hectares of land available in the warmer northern parts ofArgentina where jatropha can be grown and used to produce bio-diesel. The Indiancompanies can also invest in commercial forestry in Argentina to take back to India woodand paper pulp which are imported by India regularly.

Shipping

Freight Rates from

Mumbai to Buenos Aires:

20 foot container: USD 120040 foot container: USD 1900

Goods can also be transhipped through Durban in South Africa

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History

Five phases in the development of computing technology:

Sr.no Phases Detail1. Mainframe and

minicomputer computing.

The first most area wasruled by IBM and theirmainframe computers andthese computers take wholeroom and teams are requiredto run them,IBM suppliedthe hardware and software

2. Personal computers Personal computers began in1965 as microprocessorstarted to compete withmainframe and minicomputer and the process ofdecentralizing computingpower from large datacenters to smaller offices

3. Client/server networks Client/server in whichcomputers on a commonnetwork were able to accessshared information on aserver

4. Enterprise computing Enterprise area enabled by

high speed networks, tied all

aspects of the business

enterprise together offering

rich information access

encompassing the complete

management structure.

5. Cloud computing Cloud computing area of

information systems

employs networking

technology to deliver

applications as well as data

storage independent of the

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configuration, location or

nature of the hardware.

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MANGEMENT INFORMATION OF ARGENTINA

INTRODUCTION

Argentina is the nation among the richest in the world, with the largest middle class in

Latin America, yet that entered the twenty-first century seething with economic crisis and

frustration.

Argentina is a beautiful country that contains stunning natural wonders- desert,

mountains, lakes, glaciers, falls and oceans; a country that is refreshingly European with

a passionate culture, not as European as it looks but offers a European-flavored

sophistication.

It is a country of misery and squalor surrounded by large extensions of fertile land- the

other Argentina. For most of us, Argentina is the birthplace of football legend Diego

Maradona - a country where an interest in soccer may be all one to make friendship with

local locations.

Argentina is a constitutional republic and representative democracy. The government is

regulated by a system of checks and balances defined by the Constitution of Argentina,

which serves as the country's supreme legal document.

The seat of government is the city of Buenos Aires, Argentina is regulated by the

Congress. Suffrage is universal, equal, secret and mandatory.

The armed forces of Argentina comprise an army, navy and air force, and number about

70,000 active duty personnel, one third fewer than levels before the return to democracy

in 1983. The President is commander-in-chief of the armed forces, with the Defense

Ministry exercising day-to-day control.

There are also two other forces; the Naval Prefecture (which patrols Argentine territorial

waters) and the National Gendarmerie (which patrols the border regions); both arms are

controlled by the Interior Ministry but maintain liaison with the Defense Ministry.

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Demographic Comparison of India, Argentina & Gujarat

Sr. No. Particular India Argentina Gujarat

148

1President Pratibha Patil

CristinaFernandez

Dr KamlaBeniwal

2 Population 1,189,172,906 41,769,726 60,383,6283 Capital City New Delhi Buenos Aires Gandhi agar4 Largest city Mumbai Buenos Aires Ahmadabad5 Life Expectancy 66.8 76.95 64.16 Human

DevelopmentIndex

0.60 0.86 0.62

7 Literacy Rate 61% 97.2% 79.31%8 GDP per capita $3500 US $14700 US $13509 Corruption

Perception Index3.4 2.9

10 WealthiestCitizens

Mukesh Ambani($19.5bn US)

Gregorio PerezCompany &

family ($1.8bnUS)

Mukesh Ambani($19.5bn US)

11 UnemploymentRate

10.8 7.9 6.5

12 Independence date 15 August 1947 9 July 1816 15 August 1947

13

Religions

Hindu 80.5%,Muslim 13.4%,Christian 2.3%,Sikh 1.9%, other1.8%, unspecified

0.1% (2001census)

nominally RomanCatholic 92%(less than 20%

practicing),Protestant 2%,

Jewish 2%, other4%

HINDU89.09%

MUSLIM9.06%Jain

1.04%Christian

0.56%Sikh 0.09

%Buddhist

0.04%

14Languages

Hindi 41%,Bengali 8.1%,Telugu 7.2%,Marathi 7%,Tamil 5.9%,

Urdu 5%,Gujarati 4.5%,Kannada 3.7%,

Malayalam 3.2%,Oriya 3.2%,

Punjabi 2.8%,Assamese 1.3%,Maithili 1.2%,

other 5.9%

Spanish (official),Italian, English,German, French

GujaratiHindi

English

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15 Area 3,287,263 km sq 2,780,400 km sq 196,024 km2

16 Coastline 7,000 km 4,989 km 1600 km17 External Debt $238,000,000,000 $128,000,000,000 $334.9 billion

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DATA OF 2012

Sr.no Topic India Argentina1 Capital cities New Delhi Buenos Aires2 Head of the state President Pratibha

PATILPresident CristinaFERNANDEZDE KIRCHNER

3 Head of Government Prime MinisterManmohan SINGH

President CristinaFERNANDEZDE KIRCHNER

4 Birth rate 20.97% 17.54%5 Death rate 7.48% 7.38%6 Unemployment rate 10.80% 7.90%7 Labor force 4,78,300,000 16,620,0008 Inflation rate 11.70% 22.00%9 Import annual (us $) 327,000,000,000 56,440,000,00010 Budget 170,700,000,000 87,630,000,00011 GDP(US $) 4,060,000,000,000 596,000,000,00012 Export annual (us $) 201,000,000,000 68,500,000,00013 Population growth 1.34% 1.02%14 Population 1,173,108,018 41,769,72615 Literacy total per. 61.00% 97.20%16 Currency Indian rupee (INR) Argentine peso

(ARS)17 Boarder country Pakistan,

Bangladesh,China

Brazil, Paraguay,Uruguay

18 GDP BY SECTOR Agriculture: 19%industry: 26.3%Services:54.7 %

Agriculture: 5%industry: 28%Services: 67%

19 Industrial GrowthRate

7.9 8%

20 Currency Code INR ARS21 Independence 15th Aug 1947

(from England)9th July 1816(from Spain)

151

COMPARISON OF INDIA & ARGENTINA GDP BY SECTOR

5%

67%

28%

ARGENTINA GDP BY SECTORS

indusries

services

agriclture

152

26%

55%

19%

INDIAN GDP BY SECTORS

indusries

services

agriclture

153

List of leading Companies of India, Argentina & Gujarat

Sr. No. India Argentina Gujarat

1 Cognizant Telefonica De Wipro Limited

2Aegis Group

Nortal Inversora Trinity Infotech

3Crisils Erevna

MercadolibreVB Soft India

Limited

4Copal Partners

IMPSATACE softwareExport Limited

5Ctellen

El Sitio Vadhvan Infosys

6Wipro

Boldt Tirth Infotech

7 TCSTICS Technology

India Pvt Ltd

Advantages and Disadvantages of Management Information System

ADVANTAGES DISADVANTAGESCompanies are able to highlight theirstrengths and weaknesses due to thepresence of revenue reports, employees'performance record etc.

While information technology may havestreamlined the business process it has alsocreated job redundancies, downsizing andoutsourcing

The availability of the customer data andfeedback can help the company to aligntheir business processes according to theneeds of the customers.

Though information technology may havemade communication quicker, easier andmore convenient, it has also bought alongprivacy issues

Information is considered to be an

important asset for any company in the

modern competitive world.

Industry experts believe that the internethas made job security a big issue as sincetechnology keeps on changing with eachday

154

SWOT Analysis of Management Information System in INDIA, ARGENTINA,

And GUJARAT

Sr.No PATICULARS ARGENTINA INDIA

1. STRENGTH boom of information

technology

Following Quality

Standards such as

ISO 9000, SEI

CMM etc.

2. WEAKNESS low security Contribution of IT

sector to India 's

GDP is still rather

small

3. OPPORTUN-ITY More effecient and

more user, friendly

interferences

High quality IT

education market

4. THREATS Security concerns Lack of data

security system

Types of Information System in Argentina

Management Information System (MIS)

It produces fixed, regularly scheduled reports based on data extracted and

summarized from the firm’s underlying transaction processing systems to middle

and operational level managers to identify and inform structured and semi-

structured decision problems.

Decision Support System (DSS)

It is a computer program applications used by middle management to compile

information from a wide range of sources to support problem solving and decision

making.

155

Executive Information System (EIS)

It is a reporting tool that provides quick access to summarized reports coming

from all company levels and departments such as accounting, human resources

and operations.

Marketing Information System

It is a Management Information System designed specifically for managing the

marketing aspects of the business.

Office Automation System (OAS)

It supports communication and productivity in the enterprise by automating work

flow and eliminating bottlenecks.

School Management Information systems (SMIS)

It covers school administration, often including teaching and learning materials

related to school.

Five module of decentralized approach

MODULE TOPIC

personnel management module recruitment, legal and administrative decisions,

salaries, pension, etc.

academic management module registration, courses, examinations, classrooms,

etc

student management module follow up of newcomers, continuing students

and graduates, etc.

156

financial management module accounting, budgeting, payments, cash flow,

cost analysis, etc

Infrastructure management module buildings, laboratories, workshops, equipment,

etc.

Argentine Companies in India

Sr. No. Company Information

1IMPSA

The Argentine engineering company, specializing inhydroelectric projects, has an office in Gurgaon. They

are exploring opportunities for projects as well as supplyof power generation equipments such as turbines. They

have a manufacturing unit in Malaysia

2Biosidus

An Argentine pharma company has plans to set up aplant in India for production of biotech pharmaceuticals

for Indian and Asian markets. They are alreadyexporting over 3 million dollars a year to India.

3Arcor

The Argentine multinational company manufacturingchocolates and candies is opening an office in India in

2012 and plans to set up a plant in future.

4Bago

The leading Argentine pharma company has an office inHyderabad. They have a joint venture operation withRanbaxy to market their products in Thailand. Some

Argentine companies have shown interest in investmentsand joint ventures in India in food processing and auto

parts.

Joint Ventures with India

There are 12 Indian Companies which have established operations in Argentina. They

provide employment to 7000 Argentines. Seven of them are in IT, two in agro-chemicals,

one in pharma, one in cosmetics and one in electrical lighting.

TCS has a unit employing 350 Argentines in Buenos Aires and has plans to

increase the staff strength to about 1000.

Cognizant has IT and BPO operations employing 300 staff.

157

Aegis Group from India has acquired Argentine BPO Company Actionline in

2010 which employs 5,000 people in Buenos Aires, Cordoba, Tucuman and Bahia

Blanca.

CRISIL’s IREVNA has set up a KPO (Knowledge Process Outsourcing) unit in

Buenos Aires for financial and investment research services employing 70

Argentine staff.

Copal Partners an Indian Financial Research company has established an office

in Buenos Aires in the second half of 2010. They have plans to hire 50 staff.

Ctellen a Mumbai-based IT company, has bought an Argentine start-up company

"Net People" which specializes in software for mobile phones.

Wipro opened an IT centre in Buenos Aires since 2010.

Competitive advantages for BPO, KPO and Software Development

Argentina has one of the highest literacy rates in Latin America with ample

availability of qualified and skilled manpower, some of whom are proficient in

English.

The cost of operations and salaries are much below to those in Mexico, Brazil and

Chile. The local salaries are somewhat closer to Indian salaries in some cases.

Indian IT, BPO and KPO companies can offer services to their North American

clients in the same time zone to avoid night shift operations in India.

The Buenos Aires City Government as well as other city and provincial

governments are developing new technology parks and are giving incentives and

facilities for IT companies.

158

Argentina companies acquired by India

Havells Sylvania of India has operations in Argentina in distribution and sale of

their lighting products.

Godrej has acquired two Argentine cosmetic companies in 2010: Issue Group and

Argencos. They produce hair colour and other cosmetic products. They also

export to other countries in the region.

Reliance has formed a joint venture with an Argentine oil company Pluspetrol

(The consortium includes Westwood of Australia) and they have won a

concession in Peru for oil exploration and production.

Srishti Group of Kolkata has signed (in 2009) a MoU with the provincial

government of Misiones to build a “Vedic Hotel” in the tourist resort of Iguazu.

Ashok Leyland has signed a MoU with Plaza Group of Argentina for joint venture

in production of buses and trucks.

Tata Motors is exploring possibilities of joint ventures in vehicle production in

Argentina.

Sonalika Tractors has signed a MoU with an Argentine company for tractors and

agricultural machinery.

ONGC (OVL) has signed MoU With ENARSA, Their Argentine Counterpart for

possible joint ventures in Argentina For oil exploration.

Kirloskar is planning to put up assembly plant In Argentina For manufacture of

pumps.

159

IFFCO is the Gujarat Based fertilizer cooperative company in talks with

Americas Petrogas of Canada to set up a urea plant using gas produced in

Lapampa Region of Argentina.

IT Companies in India

Sr. No. Company Turnover Growth Rate Work Force

1 Aegis Group $50 Million 65% 50000

2 Cognizant $6.2 Billion 40% 137700

3 Wipro $290 Million 45% 120000

4 TCS $6.3 Billion 18.37% 226751

5 Copal Partners $3.8 Billion 20% 30000

IT Companies in Argentina

Sr. No. Company Turnover Growth Rate Work Force

1 Telefonica De $1.21 Million 14% 161029

2 Nortel Inversora $1.37 Million 19.20% 47000

3 Mercadolibre $11.49 Billion 25.01% 1633

4 Impsat $10 Million 12.9% 1251

5 Hexacta $9 Million 10.32% 25

160

Scope of Indian industries in Argentina

IT Sector

The IT sector has started growing in recent years. It employed about 50,000 people and

had a turnover of 2.5 billion dollars in 2009 increased from 300 million dollars in 2006 to

over 500 million dollars in 2009.

The Argentine software industry´s ambition is to increase turnover to 7 billion dollars by

2016 including exports of one billion dollars and employment to 150,000 peopleThe IT

sector has started growing in recent years. It employed about 40,000 people and had a

turnover of 2 billion dollars in 2011.

The Argentine software industry´s ambition is to increase turnover to 7 billion dollars by

2016 including exports of one billion dollars and employment to 150,000 people.Indian

companies have shown interest in investment in the shale gas resources of Argentina.

Argentina is the third largest exporter of bio-diesel in the world. They exported over 1.5

million tons in 2011 and are increasing production capacity to 3.5 million tons by

2012.India can also consider imports from Argentina. The Indian companies can also

invest in commercial forestry in Argentina to take back to India wood and paper pulps

which are imported by India regularly.

Pipe industry

The lower penetration levels Offer a Huge Scope for Indian Pipe Companies. The Indian

pipe industry with presence across all categories of pipes like steel, cement, PVC, is a

among top three manufacturing hub after Japan &Europe Pipes can be classified into

steel pipes, saw pipes, seamless pipes, ERW pipes, concrete pipes, cement pipes, cylinder

pipes.

161

Here is a list of some of the leading Pipe companies of India:

1 Welspun Gujarat

2 Man Industries

3 Jindal

4 Finolex

5 Indian Hume Pipes

6 Maharashtra Seamless

Textile industries

The textile and apparel sector has shown significant growth since 2002. During 2004, the

textile sector grew 75 percent, the highest growth recorded for any industry sector in the

Argentine economy that year.

The total Argentinean textile market is estimated to be worth US$ 12 Billion. The

clothing industry of Argentina is expected to grow steadily in the coming years in view of

the growing demand for high fashion garments and its exports and the dynamic local

retail sector consisting of local and foreign players.

Argentina’s clothing preferences have leaned towards designs and brand names which are

important, especially to the younger generation who are influenced by the US life styles

and friends.

The Apparel industry is fragmented and more than 65% is run by small family units

employing on an average 50 people.

According to the Argentine Apparel Industrial Chamber, annual production of clothing

items is valued at US$2.27 billion. The sector boasts about 11,600 manufacturing and

design companies and 30,100 retail stores.

162

In terms of supplying the domestic market, there is a mix of methods applicable to the

industry. Lower production costs have led companies from Brazil to install plants in

Argentina.

Most local firms carry out their manufacturing activity (raw materials and labor) in

Argentina; other companies import fabrics, and/or send their designs overseas for

manufacturing and receive the finished product .

Argentina has traditionally had a strong middle class segment. However, since the end of

the last decade, due to a changing socio-economic scenario, the composition of the

population has changed in terms of purchasing power and lifestyle.

According to CCR Market Consultants, the Argentine population (39 million

approximately) can be segmented as follows:

1. Upper Class: 5%

2. Upper Middle Class: 5%

3. Middle-Middle Class: 20%

4. Lower Middle Class: 30%

5. Lower Class: 40%

Since Argentina’s economy is expected to continue growing in the coming years due to

rising consumption, increased general purchasing power and rapidly growing inflows of

tourists buying Argentine textile and apparel products, there is good scope for Indian

textile companies to increase exports to this country.

Argentines are tough negotiators and personal relationships are important to develop

before business is done. In addition, it should also be remembered that the pace of

business in Argentina is slow and Argentines often need several meetings and extensive

discussion to finalize deals.

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RETAIL SECTOR OF ARGENTINA

Economic Overview of Argentina

Overview:

Argentina's economy is one of the richest and most diversified in Latin America. The

nation has a variety of natural and other resources which have combined to produce an

economy that is based on a strong industrial base, an export-oriented agricultural sector,

and a growing service sector. The Argentine population is highly educated and skilled,

and the country has a variety of natural resources including lead, zinc, copper, iron

petroleum, uranium, and rich agricultural areas.

However, after repeated periods of military dictatorship, the nation faced a variety of

economic problems when the first sustained period of civilian control of the government

began in 1983. By 1989, the nation had an enormous external debt, and inflation had

reached a level of 200 percent per month. In response, the government undertook a

variety of programs to reform and reinvigorates the economy.

In 1991, it initiated a series of programs which provided a fixed exchange rate between

the peso and the U.S. dollar and ultimately reformed the banking system. This

dramatically lowered inflation and helped stabilize the economy. The government in

2001 continued an economic program which raised taxes and cut government spending in

an effort to lower the nation's budget deficit and overall debt. Argentina suffered during

most of the 20th century from recurring economic crises, persistent fiscal and current

account deficits, high inflation, mounting external debt, and capital flight.

A severe depression, growing public and external indebtedness, and a bank run

culminated in 2001 in the most serious economic, social, and political crisis in the

country's turbulent history. Interim President Adolfo RODRIGUEZ SAA declared a

default - the largest in history - on the government's foreign debt in December of that

year, and abruptly resigned only a few days after taking office. His successor, Eduardo

164

DUHALDE, announced an end to the peso's decade-long 1-to-1 peg to the US dollar in

early 2002.

The economy bottomed out that year, with real GDP 18% smaller than in 1998 and

almost 60% of Argentines under the poverty line. Real GDP rebounded to grow by an

average 8.5% annually over the subsequent six years, taking advantage of previously

idled industrial capacity and labor, an audacious debt restructuring and reduced debt

burden, excellent international financial conditions, and expansionary monetary and

fiscal policies. Inflation also increased, the rapid economic growth of previous years

began to slow sharply the following year as government policies held back exports and

the world economy fell into recession.

The economy has rebounded strongly from the 2009 recession, but the government's

continued reliance on expansionary fiscal and monetary policies risks exacerbating

already high inflation.

Real economy: Reviving economic activity, the government’s aggressive fiscal stimulus,

and an increase in external demand has facilitated Argentinean growth which is forecast

to continue over the next year. Forecast calls for GDP to grow 5.0% y/y in 2011.

Inflationary pressures are expected to remain high.

External sector: Strong domestic demand and the real appreciation of the peso

contributed to strong import growth so far this year. Export growth mainly driven by soya

exports was not enough to offset the import boom, resulting on a smaller trade surplus.

Fiscal sector: The government has completed the bond swap with commercial creditors,

and although it has not yet attempted to access international capital markets, we

anticipate it will do so at some point next year. Fiscal spending is anticipated to remain

strong in face to the 2011 elections, which will exacerbate the overheating of the

economy.

Monetary sector: The Central Bank has also been adopting expansionary monetary

policy to instigate growth. The CB will soon be forced to tighten monetary policy in

order to contain inflation.

165

Growth Rate: The Gross Domestic Product (GDP) in Argentina expanded 2.50 percent

in the second quarter of 2011 over the previous quarter. Historically, from 1993 until

2011, Argentina's average quarterly GDP Growth was 0.96 percent reaching an historical

high of 3.70 percent in March of 2003 and a record low of -5.70 percent in December of

2001. Argentina is the third largest national economy in Latin America. Argentina has

abundant natural resources, a well-educated population, an export-oriented agricultural

sector and a relatively diversified industrial base. Domestic instability and global trends,

however, contributed to Argentina's decline from its noteworthy position as the world's

10th wealthiest nation per capita in 1913 to the world's 47th wealthiest in 2008. This page

includes: Argentina GDP Growth Rate chart, historical data, forecasts and news. Data is

also available for Argentina GDP Annual Growth Rate, which measures growth over a

full economic year.

Nominal GDP (2010): 310 bil USD. GDP to grow 5.0% in 2011.

Population: 41,769,726 (July 2011 est.)

Total Trade/GDP (2010): 37 %

Currency: Argentine Peso (ARS)

Exchange regime: Managed float

166

Economic Indicators- 1.1

Particulars 05-09 Avg. 2009 2010 2011

GDP (% growth, real) 8.4 0.8 8.6 5.0

Inflation (% chg, pa avg.) 8.5 6.3 11.0 12.5

Fiscal Balance (% of

GDP)

1.7 -0.6 -2.5 -3.1

Exports (%, comp. annual

growth)

18.5 -20.5 18.9 8.3

Imports (%, comp. annual

growth)

33.0 -32.0 36.6 16.0

Current Account (% of

GDP)

2.7 3.7 2.1 1.3

Reserves (months of curr.

debits)

6.9 9.4 8.0 7.2

External Debt (% of

GDP)

63.2 38.3 34.4 31.9

Debt Service Ratio (due) 26.6 14.5 12.9 11.3

Exchange Rate (to USD;

eoy)

3.1 3.8 3.9 4.1

167

PESTLE ANALYSIS OF ARGENTINA

POLITIC

A. Christina Fernandez De Kirchner- President since 2007, she decided to enforce a

strong state control on:

1. transports (railway, national air lines, aerospace company)

2. price of food, water and energy

3. service and industrial sector (like banks, steel maker and media).

This involved in a big inflation and withdrawal of foreign investments.

B. Lack of discipline on fiscal policy and lack of reliability of inflation data

C. importers are subject to tax on income gained in Argentina. The tax applicable to

resident companies and branches set up in this country is 35% of total earnings. The VAT

is 21 %, Moreover importers have to pay: Statistics Duty (0.5% on cost, insurance and

freight - CIF up to USD 1,750) and in some cases, Destination Confirmation Tax (2% of

CIF) and Income Tax (usually 3% in most cases).

D. the government actually is stable but the request of markets (for the future) for less

state interventionism and the recent health conditions of Kirchner open scenarios of

uncertainty.

ECONOMIC

A. Argentina recorded a strong economic recovery in 2010, driven by renewed consumer

and private investor confidence spurred by accommodating policies and the rise of prices

for exported raw materials and farm sector.

B. High inflation Rate (22% in 2010 against a world average of 2.2%), the 3rd highest

rate after Venezuela and Congo.

168

SOCIAL

A. health expenditures: since 2008 is increased from 7.4 to 9.5% of GPA

B. Football has a fundamental role in Society: all the activities are stopped during world

cup or national big matches, moreover

Argentineans concede 2-3 hours during the day to have siesta.

C. High level of crimes and rapes (15th. In the world)

D. high level of corruption in public and private sector

The Company need to take into consideration aspects like these if wants avoid delays or

problems with delivers.

TECHNOLOGICAL

A. % Expenditure R&D/GDP: 0.51 that is lower than other countries like Brazil (1.1),

China (1.44) and India (0.8) (weakness)

B. Argentina is one of the main agricultural producers in the world and need clear and

healthy water; farm production is expected to continue to rise, especially in the case of

cur...

Argentina has enjoyed an international respect since the turn of the 1900's, when Dr. Luis

Agote devised the first safe and effective means of blood transfusion as well as René

Favaloro who has been a pioneer in the improvement of the bypass surgery. Argentina

has since then had three Nobel Prize winners in the sciences.

Argentine scientists are still on the cutting edge in fields such as nanotechnology,

physics, sciences and cardiology, the latter of which Dr. Domingo Liotta revolutionized

with the first purely artificial heart, in 1969.

169

They have likewise contributed to bioscience in efforts like the Human Genome Project,

where Argentine scientists have successfully mapped the genome of a living being, a

world first.

Argentina has its own satellite programme, nuclear power station designs (4th generation)

and public nuclear energy company INVAP, which provides several countries with

nuclear reactors.

Other projects are focusing on IT, nanotechnology, biotechnology, helicopters, farming

machinery and military defensive systems. Space research has also become increasingly

active in Argentina. Established in 1991, the CONAE has since launched two satellites

successfully.

INTRODUCTION OF RETAIL SECTOR OF ARGENTINA

The retail sector in Argentina has experienced a period of decline since 1998. The

country's economic slowdown has constrained consumer spending. However, some

segments have undergone continued growth. Small markets and family-owned retail

outlets have gradually been replaced by larger chain stores. By 2000, about 80 percent of

the nation's food and beverage sales were through supermarkets and large chain outlets.

Argentina now has a number of major international hypermarkets.

But, Argentina is back on the list. Argentina dropped off the Index in 2010 but returns

this year (2011) in 25th place. It experienced strong 9-plus percent GDP growth in 2010,

but its rising inflation rates may be distorting this growth as it leads consumers to make

advance purchases. The country of 40.5 million has not experienced significant changes

in the inflow or outflow of foreign retailers, with Carrefour, Cencosud and Wal-Mart still

the leading international retailers in the country.

Argentina Retail Sales- 3.1

170

Interpretation: Retail Sales in Argentina declined 1.6 percent in January of 2012 over

the previous month. From 2008 until 2011, Argentina's average Retail Sales was 1.58

percent reaching an historical high of 14.10 percent in August of 2009 and a record low

of -12.70 percent in July of 2009.

PERCENTAGE RETAIL SALES- 3.2

Interpretation: From july-06 to july-2011 percentage change in the sales of retail shows

the better results as compare to previous and it is increased by 3% to 8.5% or more but

also we seen the highly slow down in the retail sector or bearish trend from july-08 to

july-09, when all economy faces the fear of recession also European Union faces the

financial crisis, it might be affected and adversely the retail sector of the country in this

171

year and face higher decrease in mid jul-08 to jul-09 more than 11% . On the above

seeing we can say about Argentina retail sector grow better in the recent years after

facing a high socked.

STRUCTURE, FUNCTION & BUSINESS ACTIVITIES OF RETAIL SECTOR

The organizational structure of a retail sector will vary by the size and type of the

business. Most tasks involved with operating a retail business will be the same. However,

small or independent retail stores may combine many sectors together under one division,

while larger stores create various divisions, while larger stores create various divisions

for each particular function along with many layers of management.

Structure of Indian retail sector

The retail sector is classified broadly into two:

1. ORGANISED RETAIL:

Organized retailing refers to trading activities undertaken by licensed retailers,

that is, those who are registered for sales tax, income tax, etc. these include the

corporate-backed hypermarkets and retail chains, and also the privately owned

large number of retailers, greater enforcement of taxation mechanisms and better

labor law monitoring system.

2. UNORGANIZED RETAIL:

Unorganized retailing, on the other hand, represents 97 per cent of the total retail

market is mainly characterized by typically small retailers, traditional formats of

low-cost retailing, more prone to tax evasion and lack of labor law supervision.

The local kirana shops, owner manned general stores, paan/beedi shops,

convenience stores, hand cart and pavement vendor, etc.

172

RETAIL IN ARGENTINA, INDIA AND GUJARAT

Major Retailers- 5.1

Argentina India Gujarat

Falabella

Jumbo

Castellanas

Balbi

Wal-Mart

Carrefour

Ahold Casino

Makro

Central

Debenhams

Lifestyle

Brand Factory

Marks & Spencer

Pantaloons

Reliance Trends

Vishal Mart

Shoppers' Stop

Star Bazaar

E-Mall

D Mart

Globus

Westside

Easy day

TATA star

Big Bazaar

Spar

Dailymart

Ezone

Reliance Fresh

Landmark

Brand Factory

Pantaloons

Vishal Mart

Reliance Mart

Shoppers Stop

Central

Globus

Life Style

Westside

Pantaloons

Reliance Trends

Star Bazaar

D Mart

173

COMPARATIVE POSITION OF RETAIL SECTOR OF ARGENTINA WITH

INDIA AND GUJARAT

Percentage of Retail Sector for Different Sector- 6.1

Retail Sector Argentina (In %) India (In %) Gujarat (In %)Food & Grocery 44 12 15Clothing 14 40 46Furniture & Decoration 7 9 5Foot ware 14 12 4Watch & Jewellary 6 10 13Toys, Games & Music 2 5 4Mobile 8 6 10Consumer Durable 5 6 3

Chart of Percentage of Retail Sector for Different Sector- 6.1

Interpretation: In Argentina Food & Grocery has grown a lot while in comparison it

is less in India as well as in Gujarat also. In the same way clothing sector India and

0

5

10

15

20

25

30

35

40

45

50

Argentina (In %)

India (In %)

Gujarat (In %)

174

Gujarat has developed while Argentina has not much developed and in Consumer

durable goods and Toys, Games and Music sector all has to improve.

Numbers of Retailers per Sector- 6.2

Retail Sector Argentina IndiaFashion & Clothing 8 13Food 9 16Consumer Electronics 5 5Die & Gardening 1 3Furniture & Decoration 0 3Home Ware 3 5Footwear & Lather 4 8Personal Care 2 6Baby Ware 0 1Sport & Leisure 1 1Toys, Games & Music 1 1Books & Magazine 5 7Jeweler & Watches 1 2Optical 2 6Telecom 1 2Petrol 2 3

Chart of Number of Retailers per Sector in Argentina- 6.2

02468

1012141618

Argentina

India

175

Interpretation: In India Fashion & clothing sector has more retailers compared to

Argentina while in Argentina Food sector has more retailers compared with India But

India and Argentina both have very less or near about zero retailers of baby ware, pet

care and very few of sports & Leisure and Games and Music.

RETAIL SALE

Share in GDP- 7.1

Argentina India

In 2011, the retail trade in India had a share

of 15-25% in the GDP (Gross Domestic

Product) of the country.

In 2011, the retail trade in India had a share

of 20-22% in the GDP (Gross Domestic

Product) of the country.

Current Sales- 7.2

Argentina India Gujarat

The index that tracks sales

at Buenos Aires’ largest

shopping centers increased

just 4.7% y/y in March,

after 20.9% in the previous

month (revised figure).

Meanwhile, retail sales in

nominal terms increased

14.6% y/y, after 32.2% in

the previous month.

The BMI India Retail

Report for the fourth quarter

of 2011 forecasts that total

retail sales will grow from

US$ 411.28 billion in 2011

to US$ 804.06 billion by

2015

With the recent layoffs at a

city-based mall, the retail

sector in Ahmadabad and in

Gujarat overall, has begun a

reality check. According to

industry players, retail

sector is currently

witnessing reduction in

sales by 30 per cent, apart

from layoffs.

176

RETAIL FORMATS

Hyper marts/supermarkets: large self-servicing outlets offering products from a

variety of categories.

Mom-and-pop stores: they are family owned business catering to small sections;

they are individually handled retail outlets and have a personal touch.

Departmental stores: are general retail merchandisers offering quality products

and services.

Convenience stores: are located in residential areas with slightly higher prices

goods due to the convenience offered.

Shopping malls: the biggest form of retail in India, malls offers customers a mix

of all types of products and services including entertainment and food under a

single roof.

E-trailers: are retailers providing online buying and selling of products and

services.

Discount stores: these are factory outlets that give discount on the MRP.

Vending: it is a relatively new entry, in the retail sector. Here beverages, snacks

and other small items can be bought via vending machine.

Category killers: small specialty stores that offer a variety of categories. They are

known as category killers as they focus on specific categories, such as electronics

and sporting goods. This is also known as Multi Brand Outlets or MBO's.

Specialty stores: are retail chains dealing in specific categories and provide deep

assortment. Mumbai's Crossword Book Store and RPG's Music World are a

couple of examples.

177

INDIA - ARGENTINA BUSINESS

Bilateral Trade (in million dollars) - 9.1

Argentina

2011 2010



Exports from India to Argentina (2010) - 9.2


Organic chemicals 164

Lubricants 49

Vehicles and auto parts 42

Machinery 30

Sound and image devices 24

Synthetic Fibers 18

Garments 16

Bulk drugs 15

Dyes 13

Iron and steel 12

Plastics 11

Cotton yarn 11

Rubber manufactures 9

Optical instruments 5

Minerals and gems 4

Handicrafts 3.5

Carpets and rugs 3

Saddler 2.5

Leather products 2.2

178

Artificial jeweler 1.5

Inorganic chemicals 1.2

Imports of India from Argentina (2010) - 9.3


Soybean oil 1843

Sunflower oil 36

Leather 30

Air pumps and compressors 16

Sugar 15

Corn 13

Ferroalloys 9

Wool 7

Cosmetics 5.2

Photography products 5

Water pumps 4.5

Salt and derivates 4

Dyes for leather industry 3.8

Precision instruments 3.6

Pharmaceuticals 2

Iron and Steel 1.7

Candies 1.4


Argentina has the third largest capacity for edible oil processing after China and USA.

179

Cargil Molinos Rio de la Plata Vicentin Luis Dreyfus AGD Bunge

Argentina Unemployment Rate- 9.1

Interpretation: The unemployment rate in Argentina was last reported at 6.7 percent in the

fourth quarter of 2011. From 2002 until 2010, Argentina's Unemployment Rate averaged 11.32

percent reaching an historical high of 20.80 percent in December of 2002 and a record low of

7.30 percent in December of 2008.

180

India Unemployment Rate 9.2

Interpretation: The unemployment rate in India was last reported at 9.4 percent in 2009/10

fiscal year. From 1983 until 2000, India's Unemployment Rate averaged 7.20 percent reaching

an historical high of 8.30 percent in December of 1983 and a record low of 5.99 percent in

December of 1994.

Job Trends for Retail Argentina 9.3 :

Interpretation: Since August 2010, the following has occurred:

Argentina jobs decreased 2%

181

Job Trends for Retail India: 9.4


Retail India jobs increased 111%

Job Trends for Retail Argentina Pay: 9.5


182

Argentina Pay jobs increased 13,812%

Job Trends for Retail Argentina Pay: 9.6


India Pay jobs increased 461%.

Shipping

Freight Rates from Mumbai to Buenos Aires:

20 foot container: USD 120040 foot container: USD 1900

Investment and joint ventures

There are 13 Indian Companies which have established operations in Argentina. They provide

employment to 7000 Argentines. Eight of them are in IT, two in agro-chemicals, one in pharma,

one in cosmetics and one in electrical lightning.

183

TRADE SUMMARY

-10.1

Argentina India

According to ‘Global Retail Development

Index- 2011’ Argentina 25th largest in

retail sector.

According to ‘Global Retail Development

Index- 2011’ India the 4th largest in retail

sector.

Argentina is currently the 29th largest

export market for U.S. goods

India is currently the 17th largest export

market for U.S. goods manufacturing, and

banking sectors.

184

Argentina Balance of Trade 10.1

Interpretation: Argentina reported a trade surplus equivalent to 1077 Million USD in March of

2012. Growth in foreign trade, especially trade with MERCOSUR partners, has been one of the

main factors driving the Argentine economy. Its main trading partners are: Brazil, Chile,

European Union and The United States.

India Balance of Trade 10.2

Interpretation: India reported a trade deficit equivalent to 15164 Million USD in February of

2012. Other imported products are: machinery, gems, fertilizers and chemicals. Main trading

partners are European Union, The United States, China and UAE .

185

Argentina Inflation Rate 10.3

Interpretation: The inflation rate in Argentina was last reported at 9.8 percent in March of

2012. From 1944 until 2010, the average inflation rate in Argentina was 215.46 percent reaching

an historical high of 20262.80 percent in March of 1990 and a record low of -7.00 percent in

February of 1954.

India Inflation Rate 10.4

186

Interpretation: The inflation rate in India was last reported at 9.5 percent in March of 2012.

From 1969 until 2010, the average inflation rate in India was 7.99 percent reaching an historical

high of 34.68 percent in September of 1974 and a record low of -11.31 percent in May of 1976.

Chapter 11: TRADE BARRIES

USE OF VARIOUS

EXPORT RESTRICTIVE

MEASURE

Argentina India

Common external tariff 11.6% 14.5%

Non-tariff Inspections, port-of-entry

restrictions, expanded use

of reference prices,

automatic and non-

automatic licenses, and

requirements for importers

to have invoices notarized

by the nearest Argentine

diplomatic mission when

Import licensing , custom

procedure, cabinet

approval,

Also other relating

procedure of the import-

export.

187

imported goods are below

reference prices. Anti-

dumping, import licensing.

BUSINESS OPPORTUNITY IN FUTURE

Trade sectors contributing especially to Argentina exports are:

Machinery and tools

Organic chemicals

Lubricants

Oil

Chemicals

Automobiles

In general, businesses across all sectors may face more problems in the future if they strongly

depend on:

Public buyers/state investment and consumption.

Household consumption

Retail/services:

Sectors mainly depending on consumer spending and consumer credit are most

vulnerable.

188

Small retail commerce in general is suffering from overall weak domestic

demand.

LOGISTIC SECTOR OF ARGENTINA

Introduction:

Globalization and Best Practices have been keywords of the managerial world for the

past several years. In Argentina, global competition, liberalization of the economy, and

“dollarization” of the currency have increased pressure on local businesses to perform at world-

class levels. Argentine logistics managers have responded to this challenge enthusiastically.

Sanchez and Herrero (1997) present some of the results that have occurred in the food industry.

This paper emphasizes evidence of a clear trend toward the transference of Best Practices from

World Class companies in the most developed countries to leading Argentine concerns.

The results presented are based on a study done in a leading Argentine university, where

four major companies based in Latin America participated in a multicompany-benchmarking

consortium. From a list of 20 issues (see Appendix A, Key Subjects), the following subjects were

chosen by the companies for intercompany comparison and benchmarking.

189

SWOT ANALYSIS OF LOGISTIC MANAGEMENT.

OPPORTUNITY THREATS

Vast potential in the market.Pneumatic valves are increasinglybecoming a part of every processmodule as the market moves towardsautomation.

After superior services andcomplaint management

Establishing a dealer network shallenable better focus on this deliveringservice.

Small scale , low cost competitors arethronging in the market and erodingour share with product of comparableperformance

Different competitors for differentsegments.

Market driven by prices and deliveryof goods.

STRENGTH WEAKNESS

Highly equipped transportationfacility.

Better infrastructure.

Reputation in delivering goods andservices on time.

Provide better services in accordancewith customer requirement. By takingjust in time delivery approach

Service caters to all requirements inall fields

Prices vary through competition inthese segments, Law margins.

Customer expectations in terms ofdelivery, discount andcustomization are very high.

No focus from regional offices. Allenquires and subsequent follow updivert to HEAD OFFICE.

Delivery adherence

190

Top 5 logistic Companies financial data

1) DHL

Revenue FINANCIAL YEAR11: Rs 33,112 crore


Growth FINANCIAL YEAR11: 25%

DHL is the largest provider of logistic services in Asia and second largest provider of businessprocess outsourcing services in India. Headquartered in Mumbai, DHL has over 198,500employees.

2) FEDEX




FedEx is the second largest first Company in India with 133,560 employees as of March 2011.FedEx is ranked 5th globally in the list of logistic services providing firms. It has offices in 33countries and development centers in India, China, Australia, UK, Canada, and Brazil and allover the world.

3) CAT

Revenue FINANCIAL YEAR11: Rs 9,766 crore (Rs 97.66 billion)



CAT is the world's 4th largest logistic distributor, providing sales, marketing and logisticsservices for the IT industry worldwide. CAT India is a subsidiary of this company, whichoperates in 34 countries.

4) BLUE DART




191

India commenced the operations in 1993 distributing information technology products. Thecompany gradually expanded its operations across India covering a broad range of logistic withoffices in India, West Asia and Africa

5) GEFCO




GEFCO in New York, GEFCO is a multinational logistic and transportation consultingcorporation. GEFCO has been present in India since 1992. It’s India's solutions and services spanall major industries including financial services, government, automotive, andtelecommunications.

192

COMPARISION of countries and state

Table no: 1

Argentina India GujaratCOMPANIES 559 370 45MAIN TOP 10COMPANIES

CAT, CELSOURLOGISTICA, DHL,GEFCO, FEDEX…

DHL, BLUE DERT,GATI, DTDC,FIRST FIGHT…

DHL, BLUE DERT,DTDC, ASHOKLAYLOND…

TOTALBRANCHES OFALL COMPANIES

25930 51436 4524

SERVICES HIGH & SPEEDLY MODERATE MODERATEIMPORT &EXPORT

IMPORT-99546€EXPORT-538894€

IMPORT-24522 RsEXPORT-5143 Rs

IMPORT-3824 RsEXPORT-630 Rs

REVENUE 3122 € crore 15,356 Billion 2059 BillionPOLICY BESED ON GOV. &

CO.BESED ON GOV. &CO.

BSED ON GOV.

TAX RATE As per governmentrate. (Appx. 30%)

As per slab system(10%, 20%, 30%)

As per slab system(10%, 20%, 30%)

EXCISE DUY 20% 12% 12%POSITION HIGH MODERATEGDP GROWTHRATE

56.25% 45.87% 23.19%

BUSINESSOPPORTNITIES

HIGH HIGH HIGH

RANK 19 172 -

193

COMPARISION of countries and state Revenue

Table no: 2

Argentina India GujaratYear euro in

crore%Growth

RS inBillions

%Growth

RS in Billions % Growth

2005 8.1 - 40.56 - 11.4 -2006 8.6 6.17 46.21 13.92 11.7 2.602007 8.7 6.24 48.58 14.64 12 2.692008 9 6.45 51.47 15.52 12 2.692009 9 6.45 52 15.67 12.2 2.742010 9.1 6.52 55.60 16.76 12.3 2.762011 9.3 6.66 57.74 17.4 12.5 2.81

194

Revenue of Argentina

Table no: 3

Revenue of Argentina

Graph no: 1

Revenue of India

Table no: 4

0

1

2

3

4

5

6

7

8

9

10

2005 2006 2007 2008 2009 2010 2011

Euro in Millions

% Growth

Year euro in crore % Growth2005 8.1 -2006 8.6 6.172007 8.7 6.242008 9 6.452009 9 6.452010 9.1 6.522011 9.3 6.66

195

Revenue of India

Graph no: 2

Revenue of Gujarat

Table no: 5

Revenue of Gujarat

Graph no: 3

0

10

20

30

40

50

60

70

2005 2006 2007 2008 2009 2010 2011

Rs in Billions

% Growth

Year RS in Billions % Growth2005 40.56 -2006 46.21 13.922007 48.58 14.642008 51.47 15.522009 52 15.672010 55.60 16.762011 57.74 17.4

196

GDP Growth rate in Percentage

Table no: 6

0

2

4

6

8

10

12

14

2005 2006 2007 2008 2009 2010 2011

Rs in Billions

% Growth

Country Argentina India GujaratGrowth 56.25% 45.87% 23.19%

197

Growth rate in Percentage

Graph no: 4

COMPARISON BETWEEN ARGENTINA & INDIA

ARGENTINA

logistic industry has the 10th highest productivity of any other major industrial sector inthe country

During 2006, estimates indicate that Argentina firms exported $2 billion intransportation, a figure expected to grow to $12 to14 billion by 2011. It seems that 80%growth rates in foreign delivery.

Sales

Argentina

India

Gujarat

198

Argentina logistic market saw a growth 14.6% in 2011 ,15.8% in 2012 and 18.1% in2013(expected)

Currently this sector provide 1% of global market of services, worth roughly $16 to 20billions

World economic forum rates 24th in the world for growth in information andcommunications technology.

INDIA

The logistic sector has been one of the impressive sectors of Indian economy. The Indianit growth considerably over the last decade to contribute over 8% of the country`s GDP

The Indian Services export is estimated to grow at 8.5% and to generate export revenueof $52.5 billion in year 2009-10. The services exports are estimated to be $27.3 billion in2009-10 as compared to US $ 27.8 billion in 2008-09, showing a growth of 5.8%. Its-BPO exports are estimated to grow from $15.7 billion in 2008-09 to $12.4 billion in2009-10, a year-on-year growth of 8%.

India is regarded as the premier destination for the global sourcing of logistic, accountingfor almost 51% of the global sourcing market size of $94 billion in 2009. India now has a62% share of the global logistic services market (IT Services, Engineering Services andR&D) of about $58 billion and a 32% share of the Global Business Outsourcing Marketof about $37 billion.

FedEx is the largest provider of logistic services in Asia and second largest provider ofbusiness process outsourcing services in India. AND in India the 2nd largest is DHL

The Indian top ten logistic companies growth over financial year10-financial year11 isbetween 15.10% to 20.40%.over financial years.

ARENTINA OFFERS SCOPE FOR INDIAN LOGISTIC SECTOR

CHENNAI, MARCH 21. Indian logistic companies with their creative technology are a boon tothe Argentina market. Argentina wants to tap its human resources potential and develop thecountry as a hi-tech nation. The Russian economy is also diverse financial yearning away fromthe core business of oil into other industries. So it has chosen logistic sector to develop,

First flight Indian logistic company to do businesses in Argentina, Mr. Kuepper said that Indiancompanies had enormous opportunities in Argentina. The very low cost structure and highliteracy rates in Argentina were added advantages.

Mr. Kuepper, who was in Chennai to attend the seminar, told presspersons that Argentina’sindustries were willing to grow both organically and inorganically.

199

Argentina wanted Indian companies set up offices there and also acquire companies in their hostland. He said the cost of acquisition was generally 30 per cent below the global evaluation rate.

He said experienced global players could enter the Argentina market and develop theoutsourcing services industry.

The Argentina transport market was estimated at around $ 6 billion in 2003. It had projected a 24% growth in 2004. It had relatively a low goods penetration of less than 11 per cent. Goodsdistribution revenues with 60 per cent, which is followed by system integration, dominated thecurrent market and logistic segments.

Mr. Kuepper said Argentina had drawn up a three-point development programmed fordeveloping logistic sector in its country. First, it wanted to set up a delivering facility andprovide a special economic zone for dispatch exports.

Second, it wanted to be called as "E- Argentina ". Under E- Argentina programmed, the countryplanned to invest $ 2.4 billion. The third programmed would include lowering overall tax burdenon the IT companies and enable the Argentina IT market reach $ 40 billion by 2010.

On the language issue, he said, on an average, Argentina did speak English. But no country couldsurvive only with English as a main language. He urged the Indian logistic companies to slowlylook into other languages as well.

A few Indian companies had set up their offices in CIS countries. Among them are Sun Group,

Ranbaxy, Agro and Mittal Steel.

INDIAN TRANSPORTATION SECTOR OVERVIEW

Road sector in India

Second largest road system in the world at 3.3mn km

NH Density on Area at 3.7 km vis-à-vis 6.5 km and 26.1 km of Total Road Network per

1000sqkm of land area in China and US respectively

Ports in India 12 Major ports and ~187 non-major ports in India Major ports handle ~70% of total volume of cargo

Airports in India At ~25% p.a one of the fastest growing aviation markets in the world despite global

slowdown

Over 400 new aircrafts have been ordered since 2005

200

5 Greenfield airports planned under BOT –yet to take off

Railways in India Railway intends to spend USD 55 bn into various development schemes Safety–37% Capacity increase–24%, Rolling stock–18%, Dedicated freight corridor–

10%, Metro rail projects–9%

Inland Waterway Transport in India India has 14,500 km of navigable waterways comprising of rivers, canals, backwaters,

creeks 5,700 km out of 14,500 km of IW is navigable by mechanized vessel

Trade Opportunities for India:

Potential for the export of various vehicles, two wheelers, auto parts,

Strong potential for a few trans shipment hubs

Rising need of infrastructure of jetties and cargo handling equipments

Potential for Eco-tourism

Increasing demand for the machinery including for sugar industry and railways.

The press in Argentina has undergone significant changes over the last three decades.After suffering under a repressive military regime for seven years, it emerged as one of theinstitutional building blocks of democracy. As the country struggles with the difficult task ofbuilding a free society, journalists have consistently put themselves at risk in order to bring newsto Argentine homes. As a profession, journalism has grown stronger in both political andeconomic influence. Many individual journalists, also the victims of a depressing economicpanorama, have excelled in their professional achievements, winning international awards andhelping locally to uncover government fraud, mafia activities, and human rights violations.

Media companies have also grown economically stronger under favorablelegislation. The move to a more business friendly set of regulations started under PresidentMenem. These changes allowed for a growth in private ownership of media companies neverseen before. Many critics have lamented the decreasing role of state intervention and haveaccused big media conglomerates of monopolizing the market. Unions and the left have alsoprotested what they see as excessive political influence of big media conglomerates.

The difficult economic situation in Argentina in mid-2002 leads most analysts toconclude that the short-term prospects for the country are bleak. This will seriously affect thepress, not only as it suffers from the general malaise, but also for the consequences of possibleviolent social conflict on press freedom. For small media companies and provincial newspapersthe panorama appears to be even worse. On the legal front, the slow erosion of norms benefiting

201

press workers and the constant use of presidential decrees to undertake major changes in mediaregulation have opened the door to policy volatility in the next few years.

The rapid growth of electronic media and instant access to information also pose newchallenges to old fashioned newspapers that have to adapt to a rapidly changing professionalenvironment. The accelerated growth of Internet sites and availability of broadcasting mediaonline will probably continue to grow in the near future, despite economic hardships.

Overall the future of the press seems complex and uncertain. Many important legaland economic issues that affect the profession are now being debated in Congress. Under thecurrently difficult state of affairs, the role of the Argentine press has, if anything, grown evenmore important.

The Data comprising the two countries regarding the Export-Import of Argentina and Indiastate that India has made more of Import of goods and services of last decade as compare to Argentinawho has Higher import in 2008 which were 20.7 and India at that time was at 28.9 which means moreand more of India’s revenue is going out of India

While the Export data of Argentina were strong than that of India .In the last decade theArgentina export level reduced while India made little progress. The data of 2010 shows theproportion of both the countries which stand at 21.7

While the GDP of Argentina at earlier time was minimum which stand at 10.9 were India wasat 3.8. Over a period of time India made good progress in production area. In 2010 India stoodcloser to Argentina .the data were 8.8 for India and 4.2 for Argentina

India’s export to the Argentina has increased over time but import to India is decreasing. The

India is mainly exporting the Organic Chemicals to the Argentina and in 2010 it was 164 US$

million and Lubricants was of 49 US$ million.

So By this report we can say that the Argentina has a good market for Organic Chemicals and

Lubricants.

202

For the purpose of business Argentina is good country and the market in the Argentina is

developing over time. Argentina is the third largest capacity for edible oil processing after China

and USA. So the Argentina is well developed country for the business.

203

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