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Founder's Message

Founder
MR M.R. JAISHANKAR
CMD
jaishankar-cmd

Half of calendar year 2023 is over. Unfortunately, there isn’t much ‘feel good’ news in the world, except in India, Middle East & few countries in Southeast Asia.

The mindless war between Russia & Ukraine continues. Other than helping clear the stockpile of weapons in few western economies & securing billions of dollars of fresh orders for manufacture of weapons, it has only resulted in destroying large areas in Ukraine & displacing millions of its citizens. The war resulted in much of Europe to go into recession. From a unipolar world with United States ruling the roost since the disintegration of USSR during 1991-92, the world is getting back to a bipolar world with the 2nd largest economy of the world, the communist China supporting Russia.

While politically the world has become bipolar again, economically countries have become more interdependent than ever before due to globalisation & WTO policies. This is posing a huge challenge to different economies, particularly to the United States and to the countries in Europe.

The Indian Government has played its cards smartly. Our country is beginning to see the benefit of China+1 strategy of the developed economies, not only for sourcing their product requirements, but also because they see India as a good investment destination. This has greatly helped the Indian economy to become resilient and not be affected so far by the war in Ukraine. The best indicator is the stupendous increase in Sensex & Nifty indices and Indian foreign exchange reserves crossing US$ 600 billion again. Many senior bankers feel that for the 1st time after many many years, all sectors of business are doing well. One can only hope this good show sustains for a longer time thereby helping Indian GDP reach US$ 5 trillion, sooner than later. The spoil sport can be poor monsoon, interest rate increase and unexpected events like political turmoil.

The ruling party at the centre got the shock of its life by badly losing State Elections in Karnataka. The smart electorate of Karnataka has punished the unexpected poor performance of the previous Government, apart from succumbing to the lure of multiple freebies offered by the winning party. While this has invigorated the opposition parties against the ruling party at the centre, it has also made the 2024 parliamentary elections more unpredictable. Anything can happen. What India requires is political stability and retaining its position in the world order & the goodwill generated during the past few years. What all this means to the business is the question? Uncertainty to a great extent. One never knows when the current positive sentiments will start turning negative, though there is absolutely no indication at present.

The Residential Real Estate sector is continuing to grow in a healthy way. Financial year 2023 is the best so far for the sector. The WFH/ A (work from home/ anywhere) culture continuing in a big way in USA & Europe has created millions of square feet of vacant office space in those countries, which has resulted in cautious approach by Indian & MNC companies in the tech sector to sign up new office space. Most experts feel this could be a cyclical and temporary phenomena. The good news is many MNC companies are increasing the size of their GCCs (Global Capability Centres) in India as a way to cut costs by offshoring work thereby helping to retain/ improve their profitability. This is the saving grace for the Indian Office Real Estate sector. The data localisation policy of the Indian Government has also resulted in increased demand for Data Centres. So also, the growing organised retail business has increased the demand for Fulfilment Centres/ Warehouses.

In such a macro environment, Brigade is trying to play its cards well but carefully. We have made headway in increasing our presence in Chennai significantly. We are trying to do the same in the highly competitive real estate market of Hyderabad.

While a number of new launches are slated in this financial year, obtaining civic authorities approvals is becoming more challenging than ever before, for a variety of reasons. By adhering to the multiple rules, administrative procedures and after overcoming red tape, if one succeeds in real estate business in India, they deserve to receive accolades and a pat on their back.

Rightly, the new Congress Government in Karnataka is talking of ‘Brand Bengaluru’ – to improve the image of the city which has taken a beating due to severe traffic congestion, insufficient infrastructure planning & implementation. Bengaluru deserves much better treatment by the State Govt.

Bengaluru, which contributes more than 50% of the tax revenue of the State; should receive similar share in the expenditure budget of the State to improve its infrastructure. Bengaluru is not just a city of Karnataka, it is now a Global City, known for innovation and home to 100s of MNCs.

Hyderabad with its superior infrastructure is already breathing down Bengaluru‘s neck and sure to overtake Bengaluru as an attractive investment destination, if the Karnataka Government continues to be complacent.

The advent of ChatGPT & AI (Artificial Intelligence) into our lives, slowly but surely, will have a profound effect, not fathomed by us so far. It will become a necessary evil in the years ahead. While there would be demand for people with new skills, it may also lead to thousands of job losses. So, it is very important for people and businesses to gear up the skills to keep pace with the ever changing technological advancements.

The festival season is approaching. My warm season's greeting to all our readers.
JAI HIND.


—Jaishankar CMD, Brigade.

 

ARCHIVE INDEX
"A few thoughts…" is a column that our CMD Mr M.R. Jaishankar writes regularly for our house journal Brigade Insight. A few of his columns are reproduced here."
December 2008

The most significant happening in the last quarter is the manner in which Barack Obama was elected as the President of the world's biggest economy, on the plank of promise of CHANGE. For me it was a moving experience to watch the final stages of the US election process and to listen to the high quality speeches. If one reads Obama's Audacity of Hope, one can realise what a clear thinking person he is. It certainly brings hope of a better tomorrow for the world as his views are full of sense.

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By and large, the last quarter has seen the stock markets world over getting battered, India not being an exception. Once the December quarter results start pouring in, the mood is unlikely to become better. The spectre of falling rates, increasing unemployment and tougher visa conditions in the western economies is not the fodder stock markets like.

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Unlike the bold 'bail out' packages of the US and European economies, the stimulus package/s announced by the Indian Government are at best knee-jerk reactions which are unlikely to have a significant positive impact. What is required is an extraordinary response to an extraordinary situation. Also required is a major initiative to spend US $50 to $100 billion on infrastructural projects like building highways—completing the golden quadrilateral and networking other roads that will generate large employment and improve the core sectors. Why not a 'Great Wall of India' bordering our problematic neighbours, which will also help in reducing infiltration? The three most important sectors of the old economy are agriculture, automobiles and construction. In the new economy unquestionably it is the IT sector. All these sectors require great support if the government is even half serious about improving the state of the economy.

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The November terrorist attack in Mumbai is the most heinous and boldest ever, exposing all the chinks in our armour. It has made the citizens angry, dumbfounded and helpless. Many political leaders were behaving like Nero when Mumbai was under attack.

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If the government does not ACT now by taking measures similar to what United States took post 9/11, I do not know what will make them move. The time has come to stop barking and start biting when driven to do so.

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In an otherwise gloomy quarter, the highlight event for Brigade Group is the recognition from Forbes Asia as one of the 200 Best Under a Billioncompanies in the Asia Pacific region. It is a recognition of the hard and result-oriented work of the entire Brigade team for the past two decades. My sincere thanks to the valuable contribution by our Board Members, the entire staff of Brigade Group and our associates.

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As the curtain comes down on what can be called as the most forgettable year in the recent times (from the economic stand-point), let me sincerely wish all the readers a brighter, happier and peaceful 2009.



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