The Hindu Business Line : Shining Botswana

WELCOME TIES: Festus Mogae, President of the Republic of Botswana, is felicitated by Niraj Bajaj, IMC Vice-President, while Vishnu Hade, the Indian High Commissioner in Botswana, looks on.

Being an avid reader of books and periodicals doesn't mean one is completely updated on everything. For example, this writer was unaware that Botswana is the largest diamond mining country in the world. Eighty per cent of Botswana's revenue comes from the diamond industry, and the rest from copper, nickel and other minerals. Since India is the largest diamond-cutting and polishing country, this makes us natural partners, who could pool synergies in the global market. Already, Botswana has some 15,000 Indians (the largest expat community) as compared to 4,000 Chinese.

"We like Indians," said Festus Mogae, President of the Republic of Botswana, on a recent visit to Mumbai accompanied by economic ministers and senior bureaucrats to invite India's diamond cutting and jewellery trade, financial, research, ICT and other services to set up units. Mogae's assertion of affection is significant given that (certain) Indians are disliked in South Africa. A highlight of the presidential visit was the signing of an MoU by IMC Vice-President Niraj Bajaj and Jayaram Ramesh, Member, Botswana Confederation of Commerce, Industry and Manpower (BOCCIM) for mutual cooperation. We were told another MoU was signed in Chennai with Indian Leather Goods Export Promotion Council.

The IMC proposes to organise its prestigious annual `India Calling Conference 2007' in one of the southern African countries and Bajaj urged Botswana to become IMC's partner in the exercise. M. Masire, CEO of Botswana Export Development and Investment Authority (BEDIA), said that Botswana would be organising a "Global Expo" next year and invited Indians to participate.

Capital market woos

The rate of national savings in India has risen to 30 per cent per annum. Of this, a mere two per cent trickles into the capital market. In other words, there is a fertile field for the major market operators, particularly the mutual funds, not to speak of the gold funds, capital protection funds, real estate funds and such other innovations that are now emerging. There are 31 private sector and seven public sector mutual funds, together offering 645 investment schemes: 486 are open-ended and 159 close-ended.

Speaking at a crowded convention on mutual funds at the Hilton, SEBI's Executive Director, R.K. Nair said SEBI's mandate includes protection of investors' interest, and promotion of investors' confidence and development of the market. Its role assumes great significance given that different mutual funds were following different procedures for dividend distribution.

Nair said that investors could be attracted to the capital market by ensuring good governance with features such as transparency, accountability and fairness, and better corporate performance. "It is necessary that two-thirds of mutual funds must be constituted with independent directors of high integrity, who will report directly to the regulator," he said.

Corporate Governance

The importance of ethical business practices was stressed at a seminar on Corporate Governance - CEO and CFO Certification organised by B.K. Khare & Co, a renowned Chartered Accountants firm.

Two eminent speakers, Y.H. Malegam, who was a member of the Kumaramangalam Birla committee on Corporate Governance and Chairman, Accounting Standards Committee, SEBI; and Praveen P. Kadle, Executive Director - Finance and Corporate Affairs, Tata Motors, and a Khare alumnus, addressed the session; a highlight of which was the felicitation of Uday Y. Phadke, President - Finance and Legal Affairs, Mahindra & Mahindra Ltd.

The firm's managing partner, Padmini Khare Kaicker, had set the ball rolling by saying that corporate governance is "the religion of companies (which) has become an imperative for the sustained long-term success or even healthy survival of enterprises." Recalling the dismal track record of Enron and WorldCom, Malegam talked about corporate governance as per the law in India and the role of CAs in "establishing and evaluating internal controls". Kadle shared his experiences and the related cost/benefits in the light of the US' Sarbanes Oxley Act saying, "no cost can match the value addition of high standards of governance and the restoring of investor trust."

SAIF Zone

The Sharjah Airport International Free (SAIF) Zone Authority was in town inviting Indian businessmen to set up business units — industry, trade and services — in the SAIF Zone.

Three SAIF officials, Humaid Abdullah Al Khatri, Acting Deputy Commercial Director; Ashok Varma, Commercial Director; and Thomas Joseph, Senior Marketing and Sales Officer, camped at the Taj Mahal Hotel for three days to assist businessmen to complete formalities.

Niraj Bajaj, Indian Merchant Chamber's Vice-President, who felicitated them, said that the Gulf region has emerged as the second largest trading partner of India and assured them of IMC's assistance in promoting business between the two countries.

Al Khatri pointed out that Sharjah is the undisputed commercial nerve centre of the UAE, accounting for more than 48 per cent of its industrial GDP.

Located adjacent to the Sharjah International Airport (the largest air cargo hub in West Asia and Africa, connecting 230 destinations worldwide), the SAIF Zone is only a few minutes' drive from Sharjah city, and in close proximity with Dubai and major UAE ports on the Arabian Gulf:

Among the advantages of SAIF Zone, as outlined by Khatri, were: 100 per cent foreign ownership, 100 per cent repatriation of capital and profits, 100 per cent exemption from the corporate and personal income taxes, no import and export duties, free transfer of funds, access to over two billion consumers, all licences issued within a day, 25 years' lease extendable by a similar period, and sponsorship visas for the staff.

However, Khatri didn't tell the businessmen that on a clear day, you can see Iran's Bandar Abbas from the Sharjah shore.

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