Mr X owns several apple orchards and a factory that makes jam. The people of the country in which he lives love apple jam, and do not mind that its price increases every year. However, canny businessman that he is, X knows that it is only a matter of time before the market's preference changes. Market intelligence at his disposal suggests that a new trend, a preference for orange juice, will evolve over the next few years. And while the demand for this is likely to be limited, it goes on to say, people won't mind paying a premium for orange juice (which can be made in the same factory in which X makes the jam). Now X doesn't grow oranges, but he knows where he can barter some apples for them, and so, he goes ahead and does just that.

X's decision to move from apple jam to apple jam and orange juice is, at one level, not very different from promoters selling some of their stock, or using the dividend from it, to diversify into other asset classes. Diversify, promoters must. While any transaction of theirs pertaining to their own stock continues to be viewed with a certain degree of suspicion all over the world, and especially in India, where the hangover of over four decades of believing that the private sector was out to plunder the nation still lingers, fact is, diversification is the only thing that can help promoters combat risk, meet short- and medium-term financial commitments and grow their overall portfolio. That is especially true of individuals who own a large chunk of their companies-and anything over 15 per cent can be considered that, which makes Azim Premji's holding of 82 per cent in Wipro seem extraordinarily risky. For much of the early 2000s, for instance, Bill Gates, who began 1999 with a 18.2 per cent holding in Microsoft, sold 20 million shares of the company each quarter (by mid-2004, he owned just over 10 per cent of the company). He gave some of the money away, and invested the rest in everything from non-dollar investments (in Japan, for instance) to commodities and treasury inflation-protected securities and high-yield bonds. The result: the money grew. "It shows diversification works," Gates' money manager Michael Larson said to Fortune magazine in 2004.

India's tech-billionaires, made wealthy, immeasurably so in some cases by the value the market places on their stock, have learnt that lesson. And maybe they'll even be willing to talk about it when the stigma attached to promoters selling stock ceases to be.

To Each His Own

Anyone looking for investment trends in India's it sector must be feeling a little confused. Just days before IBM's Chairman & CEO, Sam Palmisano, arrived in India and promised to up investment in the country to $8 billion (Rs 36,000 crore) over the next three years, Apple Computer announced that it was shutting its Bangalore development centre. There was no official release from Apple explaining the move, but reports and blogs that cited some Apple sources suggested that rising wage costs and employee attrition may be two reasons. Any large company pulling out of India should be a cause for concern, but at this point, Apple's move doesn't portend an ominous trend. India continues to be a cost-effective outsourcing destination for global companies. Take IBM, for instance. It already employs 43,000 people in the country (up from 38,500 six months ago) and has plans of adding as many as 17,000 more in another year or so. According to reports, other it services giants such as Accenture, TCS, Infosys and Wipro also have plans of ramping up operations. There is, of course, a fundamental difference between Apple and the IBMs. The latter are it services companies, while Apple is a hardware products company. But if someone like Dell Computers, which operates on smaller net profit margins (6.38 per cent) than Apple (9.58 per cent), finds India competitive, it's a little surprising that Apple, which had just a 30-member support set-up, shouldn't.

That said, there's little doubt that the job market in the IT sector is getting heated up. According to nasscom, larger Indian it companies have been growing their headcount 42 per cent year-on-year since 2003, with TCS, Infy, Wipro and Satyam alone adding 56,000 people to their payrolls. As a result, the wage inflation for entry-level jobs, the industry lobby says, has been between 4 and 7 per cent a year. The good news: Lower telecom costs have helped offset the increased salaries to an extent. But more importantly-Apple, take note-India is still cheaper by 4 and 185 per cent than rival outsourcing markets. The most compelling argument, which IBM seems to have discovered, is that India has a deeper talent pool than most other low-cost destinations. All these factors, however, shouldn't make India complacent. There is an urgent need to churn out better and more engineers. That's the only way India's booming tech sector can retain its edge-and an Apple gone today, may be back tomorrow.

A Vote For Globalisation

Cricket or football: Viewers are having a ball

India is still cricket country. Let's make no mistake about that. Football and other sports are still considered its poor second cousins in India. But the FIFA World Cup 2006 has proved that big local names-both individual and institutional-are not a necessary prerequisite for popularising and marketing a game in this country. India is not participating in the World Cup and there's no Indian player within sniffing distance of playing in any of the major soccer leagues in the world-and these are not likely to change in the foreseeable future-but that has not stopped the worldwide football frenzy from overwhelming large parts of this country.

The game is dominating the Indian mind space like never before. For proof, pick up any newspaper or switch on any news channel on television. Football is hogging the headlines. Even the exploits of the Indian cricket team-which is doing reasonably well in the Test series against the West Indies-are getting only second billing. This would have been considered unimaginable even a fortnight ago. The numbers bear this out. Advertisers, media buyers and ad professionals are unanimous that football is attracting eyeballs and advertisement rupees and has emerged as a mini industry in its own right. The 2002 World Cup final got a TRP rating at par with that of a One Day International. That is expected to improve substantially this time around. Already, leading international soccer clubs like Manchester United, Chelsea, Arsenal, Real Madrid and others have considerable fan following in India. And advertisers are discovering that high quality international football offers a good medium to connect with upscale Indian consumers.

Just as the growing popularity of Valentine's Day in India is being driven by the commercial interests of a greetings cards company, this football fever is also being fed by multinational and Indian companies in search of new tricks to win customers.

The seeds of this frenzy were sown 15 years ago when the government decided to free the airwaves and opened up the economy to private and foreign competition. The growing popularity of football in this country is just another pointer to the fact that those decisions were right. The people of this country are voting with their feet in their favour. Globalisation, which means different things to different people, is merely a term that some people use to describe this phenomenon.