J. Jayalalithaa, CM, Tamil Nadu: Ready my lips

One story has it that a brave bureaucrat picked up his courage and suggested Tamil Nadu Chief Minister J. Jayalalithaa travel to Bangalore to see the progress Karnataka was making in terms of becoming a preferred destination for it and it-enabled services companies. "When she came back," says a Chennai-based it exec, "the scales had fallen from her eyes''. That narrative may be apocryphal, but Tamil Nadu is in the news as a preferred investment destination.

Exhibit A: Infosys Technologies recently announced that it would invest Rs 1,250 crore in a 129-acre, 3.5 million square feet facility that would house 25,000 employees in The Mahindra Industrial Park near Chilgleput on the outskirts of Chennai.

Exhibit B: Azim Premji, Chairman, Wipro, met with Jayalalithaa and asked for 100 acres of land. Wipro has also asked for 15 acres in an IT park coming up at Coimbatore.

Exhibit C: The February 21 issue of The Economist carried a special report on India. Tamil Nadu was one of the two states that advertised in the issue.

There's more evidence, some anecdotal, some empirical, even apocryphal, of a similar nature. Like the story of a seminar organised by the Federation of Indian Chambers of Commerce and Industry (FICCI) at which the cm spoke. Setting the agenda, a FICCI-functionary listed the things industry would like to see the state do. When she got up to speak, Jayalalithaa addressed these issues with responses that ranged from 'done' to 'Mr X of the XXXXX department will be looking into this', and ended by saying that now that these issues had been addressed, industry had better invest in the state. Such imperiousness was once the bane of the state's fortunes in terms of its ability to attract investments. Now, it would appear, the same is being put to good effect.

Sudeep Jain, the Managing Director of Elcot, a state-run agency that facilitates the creation of it parks, puts much of this down to Tamil Nadu's decision to go out and communicate its USPs (unique selling propositions) better. "IT Secretary Vivek Harinarain had repeatedly made presentations on the need for this; he finally had his way," says Jain. Perception was indeed the state's undoing. In BT's survey of The Hottest States For Business (See Business Today, September 28, 2003), it ranked No. 5-No. 2 in terms of objective criteria and No. 6 in terms of perception.

The strategy seems to be working. Builders such as The Chatterjee Group Urban Infrastructure Holdings (promoted by Purnendu Chatterjee) are investing in creating technology parks in Tamil Nadu. Real estate costs less than it does in Bangalore, the city has a better-connected airport, salaries for coders are lower than in Bangalore, and attrition rates are a fraction Bangalore's. B.G. Menon, the Chief Operating Officer of Mahindra City is confident of signing two more Infosys-like deals soon.

Not everyone shares that sentiment. "I believe Tamil Nadu is very unfriendly; investments from my country have gone to Karnataka and Andhra Pradesh," says the head of the South Indian office of a European major's Trade Commission. That's in the past, insists Dorothy Thomas, a partner at Kocchar & Co, a law firm specialising in entry-strategies for multinationals. "We get four to five queries from overseas companies interested in investing in Tamil Nadu everyday," she says. The tide, it would appear, has changed.

-Nitya Varadarajan

STREET WISE
Lessons From The Wild West
What Indian Inc's promoters could learn from Disney and Dell.

The visiting cards of two high-profile chiefs of high-profile global companies will now be a lot simpler. Whilst Michael D. Eisner of Walt Disney was knocked off the Chairman's pedestal by rebellious shareholders-he will continue to be CEO-Michael Dell of Dell Computer will relinquish the CEO hot seat come July, and continue as Chairman. Efforts to draw a parallel between the two redesignations are tempting, yet the circumstances are different in each case. Eisner was clearly under investor pressure to perform, whilst Dell had no such compulsions. Yet, what's significant is that scandal-struck Corporate America is slowly, but surely moving towards separating the roles of the Chairman and the CEO. Dell is now in an elite league: In 1998 Intel Chairman Andrew Grove handed over the CEO position to Craig R. Barrett and in 2000 Bill Gates vacated the CEO seat for Steven Ballmer.

Back home, it's tough to find instances of a divorce between the role of the chairman and the CEO, particularly at the crème de la crème of Indian business. Suggesting such a separation would invite ridicule and a ''how-dare-you'' and ''do-you-value-your-job'' glare. It's not uncommon to hear head honchos predicting a widening gap between ownership and management but the proof of the pudding is in the eating. And, as of date, the pudding is still being baked in the oven.

The objective of a company's board, headed by the chairman, is to govern. The CEO's is to manage. These are two different roles, given that the Chairman has to challenge the CEO at some time or the other in protecting shareholders' interests. If the board is overshadowed by the CEO, there's little chance of its members asking tough questions about the company's numbers, investments and strategy. If the Chairman and the CEO is the same person, it's like a performer and the judge of the performance being the same person. Scandal-struck corporate America has had plenty of provocation to question the chairman-CEO relationship. Does India Inc need to wait for something similar...

Buffett On Dalal Street?

Althought last fortnight's gossip about Warren Buffett investing $1 billion (Rs 4,600 crore) in ONGC's public offering proved to be a figment of a rather desperate imagination, the chances of ''The Sage of Omaha''-whose followers, known as ''Buffetters,'' could outnumber the number of Deadheads (at least those still alive)-cosying up to Indian markets aren't that unreal. Buffett is sitting on tons of cash-all of $27 billion (Rs 124,200 crore), as of December 31, as per the disclosure made by his company Berkshire Hathaway to the sec in mid-February. Not just that. Buffett, who hates selling stock (he's been holding scrips like Coke for decades now), has been doing exactly that. In the quarter ended December 31, Buffett sold his holding in four companies, and reduced his stake in eight. Whilst the value of those sales may be just a fraction of his total portfolio of $35 billion (Rs 161,000 crore), fact is Buffett is doing something pretty unusual: He's selling! The only new significant addition to that portfolio is a European company. The implications of such a shift are clear: Buffett isn't too kicked with the US markets, and finds few stocks worth lapping up. So, what should he do with $27 billion? A few billions in emerging markets, which are still attractive despite some fears of over-concentration, would do just fine. Of course, Buffett has to be convinced that India is more attractive than say Latin America or Russia or Asia (ex Japan). Don't rule it out.

-Brian Carvalho

CURIOSITIES
Reliance's Wrist-watch Mobile

What is it: A wristwatch phone with a plug-in camera, nothing we haven't seen in a 007 pic.

Features: 98 grams; voice commands and voice recognition; infrared ear-piece.

Price: Rs 23,900

Maker: Telson (Republic of Korea)

Usage: 1. Hold wrist at chest height and use speaker-phone.

2. Use the infrared ear-piece.

3. Sport metal ring (comes free) on finger, draw attached wire and plug to wrist-watch, and take calls through the ring.

Quotable quote: "This is a lifestyle product being introduced for the first time in the world; there is a potential market for it in thousands," says S.P. Shukla, President (Wireless Products and Services), Reliance Infocomm.

-Venkatesha Babu

Q&A
''International Beer Brands Work In India''

Running a beer company is a desired profession among lager-conscious college students. But for Graham Mackay, the business is deadly serious. SABMiller, the company he heads, became the world's second largest brewer after its 2002 acquisition of Miller from Philip Morris. It has breweries in over 40 countries, revenues of over $9 billion (Rs 41.4 crore) and sells 115 million hectolitres of beer. In India, SABMiller is present through a joint venture between subsidiary Mysore Breweries and Shaw Wallace. On a whistle-stop tour of India, Mackay managed a quick interview with Kushan Mitra. Not over a beer. Excerpts.

Beer is a local business. How can you internationalise it?

As we have seen with the limited success of Castle Lager in India, international beers do work. International brands can span borders; just look at Heineken. And they also allow companies to develop scale economies. The global beer market is growing, but the international brands are growing at a furiously fast clip.

Any chances of launching any of the other three major brands in the SABMiller stable (Miller, Peroni, and Pilsner Urquell) in India?

We are contemplating a launch soon, but we have not decided what and when. Scale is important.

India consumes very little beer (0.6 litre per capita) versus the bigger countries (100 litres per capita plus). Can the market grow, and how fast will it grow?

India is a traditional spirit drinking country. Generally, positive economic indicators lead to increased beer consumption, and I believe the same will happen in India.

You must have had a lot of beer over your life, what is your favourite beer?

I have had a lot of beer, from various parts of the world. Strong, mild, heavy, name it. But, my favourite has to be Pilsner Urquell.

NEXT
After Das

Confederation of Indian Industry (CII) director general, Tarun Das had planned to step down way back in 1997, when he turned 58. But the tina factor ensured that the man, who has single-handedly transformed a Kolkata-based association of the engineering industry into an influential, rich (annual budget: Rs 110 crore), 750-employee strong confederation of 4,800 companies, continued. Seven years later, at 65, td, as Das is known in some circles, called it a day. N. Srinivasan, an old CII hand, will take over as the new director general. td will not stop working, though. He will do a Narayana Murthy at CII and has been appointed Chief Mentor. "This designation was decided in consultation with Narayana Murthy (Infosys' Chairman and Chief Mentor and a member on CII's board)," jokes Das. "He has proprietary rights over it."

-Sahad P.V.

COPING
What DRL's Loss Means?

Dr Reddy's Prasad: It's not the end of the world

Need for greater predictability'. That's the term of choice at Dr. Reddy's Laboratories after The US Court of Appeals for the Federal Circuit determined that the patent extension covering Pfizer's Norvasc(r) (amlodipine besylate) is applicable to Dr. Reddy's amlodipine maleate. ''We are clearly disappointed by the court decision and had expected that the views expressed by the Chief Judge in the dissent would have been the position of the majority," says CEO G.V. Prasad. "However, we remain committed to investing resources to create a sustainable US-based business of specialty products and new chemical entities, as well as generic medicines." The view on D-street is that the strategy of pursuing 'non-linear growth opportunities' (read: generics and specialty products) is 'sound', but that the current setback may temporarily delay Dr Reddy's US-plans. As it will enlighten Indian Pharma that the US doesn't really present a get-rich quick opportunity.

-E. Kumar Sharma

DOTCOM
Google Made Supple

If you haven't heard of this website- www.soople.com-it is not because you're not a fan of soup. This a relatively new website created by a Dutchman called Floris Rost van Tonnigen for his mom, but you can use it too. What it essentially does is allow average web surfers the ability to harness Google's tremendous power. We all know that Google has a simple front page, but did you know that it had calculator, translation and format-specific functions? Most probably not. So at Soople's rather more crowded interface you can search more specifically for something, and not get inundated by results. Expect this to catch on soon.

-Kushan Mitra