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Indian Startups Ditch Chinese Investors & Move Towards Japan As India-China Ties Worsens

It is hard to estimate whether Japan will be able to match China in terms of investment and risk appetite as 18 of India’s 30 unicorns — private companies with a valuation of at least $1 billion — have a Chinese investor.

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With deteriorating ties between India and China, Indian startups are looking towards Japanese investors as the COVID-19 pandemic has left them high and dry. Experts wonder if Japan can match China in terms of investment and risk appetite.

With the ongoing lockdown and the fears of raging virus, businesses have resisted opening its operations fully which has led to ploughing back of past profits and earnings. While it is easier for long-established profit-making businesses to survive, though, for a limited period in such a situation, it can prove to be fatal for the startups with little or no profits to fall back on.

In April, the Indian government modified the Foreign Direct Investment (FDI) policy which would require the government’s approval for nations sharing a border with India to invest in the country. Such a move is aimed to curb opportunistic takeover, especially from China, when the country is still in the process of fighting the COVID-19 pandemic.

There is a rising sentiment against Chinese products in India due to the recent border clashes. After the troops of the two neighbouring countries clashed on the LAC in the Galwan valley leaving 20 Indian troops dead and an unknown number of Chinese casualties, people are pledging to boycott Chinese products.

“In the last 12 to 18 months, a lot of Chinese VCs or Chinese companies want to throw money at Indian companies, and that has inflated a lot of deals,” said Chua Kee Lock, CEO of venture capital firm Vertex Holdings. He further added that the decline in Chinese investment due to the new regulations means startup valuations in India will be hit harder than in other countries.

With growing ties between India and Japan, Indian startups are looking to get investors. “Japan, by any stretch of the imagination, is one of the top candidates [to enter India],” said Rakesh Mishra, founder of electric powertrain startup Entuple E-Mobility, during his presentation organised by National Association of Software and Service Companies (NASSCOM) to woo the Japanese investors.

“At this juncture, I won’t be interacting with any Chinese investors,” said Ajit Patil, a co-founder of DeepTek, a Pune-based medical startup. He raised several million dollars in funding from local investors and Japanese medical imaging company Nobori in May.

Toppan Printing, a Japanese commercial printing company joined a $15 million funding round for Medikabazaar, an online shopping site for hospitals making it Toppan’s first investment in an Indian startup.

“Many parts of Southeast Asia and India are ahead of Japan in going digital,” said Hiroshi Eguchi, who leads strategic investments at Toppan. “India is also attractive as a market,” he added.

However, it is difficult to estimate whether Japan will be able to match China in terms of investment and risk appetite. According to Gateway House, a Mumbai-based think tank, 18 of India’s 30 unicorns — private companies with a valuation of at least $1 billion — have a Chinese investor.

Another Japenese fund, SoftBank is one of the biggest investors in Indian companies like Paytm, Oyo and Ola with about $10 billion in investments.

“There are many companies that make large acquisitions but a better approach may be to find success through various investments,” said Takeshi Ebihara, general partner at venture capital firm Rebright Partners, said during the NASSCOM event.

Analysed By Smriti Chaudhary. Invaluable inputs from Nikkei Asian Review

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Asia Pacific

China-Pakistan Economic Corridor Economically & Logistically Unstable – Experts

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China’s ambitious plan to transport oil across the Himalayas in Pakistan under the China-Pakistan Economic Corridor (CPEC) might be “economically unsustainable” and actually benefit the US in the ongoing US-China rivalry.

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China has pushed its way to conquer Pakistan’s construction sector with its multi-billion-dollar Belt and Road Initiative (BRI) offering it more than 40 projects. One of the ambitiously proposed projects includes an oil pipeline connecting Gwadar port to Kashgar in China’s Xinjiang province via the challenging and unstable region of Himalayas.  

Experts write — “Starting from sea level, it will have to cross the 4700-metre Khunjerab pass to reach the Chinese mainland, requiring heavy pumping equipment and significant power supply to keep the pipeline flowing.”

Pakistan Deploys Additional 20,000 Soldiers In North Ladakh On China’s Behest – Reports

Additionally, the author says that the region is prone to the periodic danger associated with earthquakes and landslides which adds to the regular costs of maintenance. The temperature also drops to as low as negative 30 degrees Celsius which would require heating technologies apart from the insulation.

Furthermore, the project is also believed to be economically unsustainable as a study formulates that it would cost approximately $10 a barrel to move oil from Pakistan to western China through pipelines, along with added $5 to deliver oil to demand centres in the eastern region.

Pakistan Deploys Additional 20,000 Soldiers In North Ladakh On China’s Behest – Reports

On the other hand, it costs just $2 per barrel to ship oil from the Persian Gulf to the east coast in China. The author says that “this translates to China losing roughly half a billion dollars per year through pipeline shipments.”

Meanwhile, China has been pressing the project, however, the Xinjiang province of China is already supported by a massive network of oil and gas pipelines from Kazakhstan and Russia. Many experts speculate that China’s interest in the project in Pakistan stands solely due to the Malacca dilemma that could work in favour of the United States.

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VS Reddy, a research assistant at the Nuclear and Space Policy Initiative of the ORF believes that “China has been pressing to complete the Gwadar port in Pakistan and build the China-Pakistan Economic Corridor (CPEC), allowing it to be connected overland to an Indian Ocean port.

Gwadar and CPEC allow China to circumvent the Strait of Malacca which can be blocked by rival navies in the event of a conflict termed as “Malacca Dilemma”. Many political analysts opine the Strait of Malacca situated between Malaysia, Singapore, and Indonesia connecting the Indian and Pacific Oceans could help the US gain advantage from an event of Chinese blockade in the region.

How Many Chinese Soldiers Were Killed In The India-China Clash At Galwan Valley / Ladakh?

“Since China’s economic growth is highly dependent on the sea routes for receiving energy along with other raw materials which it uses for cheaper productions which are later shipped back as finished products other continents, it could be a major blow to China,” tells Ragahvan Srivastava to EurAsian Times.

India has established a strong naval presence in the Andaman Sea adjacent to the Strait of Malacca and is regularly partnering with the U.S. and other countries in safeguarding it. “Such a presence can be translated into a formidable blockade. On the other hand, China has yet to showcase its capabilities and willingness to fight to keep this Strait open for its ships,” writes Vidya.

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Rahul Jaybhay / Vipasha Kaushal

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Asia Pacific

India-China Standoff: Decrease Border Tensions Or Face Business Losses – China Warns India

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China has warned India of repercussions in business and has threatened the possibility of being replaced by other Southeast Asian markets “if the boiling nationalist sentiment continues unchecked in India”.

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China’s state-run newspaper, Global Times (GT) which runs at the hands of the Chinese Communist Party has warned that the growing anti-China sentiment in India following the Himalayan brawl at the border in Ladakh may harm the business ties between both the Asian economic giants.

“If the boiling nationalist sentiment continues unchecked in India, it may lead to serious consequences in extreme cases, which would only weaken that market’s appeal to the outside world, making it easier to be replaced with other Southeast Asian markets,” writes the Chinese daily.

India’s anti-China sentiment

Post the violent border clashes in the Galwan valley of Ladakh where 20 Indian soldiers lost their lives to Chinese troops, the Indian countrymen stood up in nationalistic fervour against China by launching a campaign to boycott Chinese products. 

Indian netizens trended hashtags like #HindiCheeniByeBye, #MadeInIndia and #BharatVsChina on Twitter and made repetitive calls for the absolute boycott of Chinese goods and rather opt for domestic brands.

The Indian Prime Minister, Narendra Modi had previously led a campaign called “Vocal for Local”, however, experts believe that it was not even remotely connected to the latest situation with China.

The Smartphone Scenario

On Wednesday, the Chinese Smartphone giant Oppo cancelled the live stream launch of its flagship 5G smartphone in India amidst the intensifying calls for boycotting Chinese goods in the nation.

In India, 4 of the top 5 players in the Smartphone business are Chinese brands. While Xiaomi remains at the top position conquering almost a third of the market, Oppo stands at fifth position and has shipped about 3.5 million devices in the first quarter of 2020.

“In order to ensure the safety of their capital and personnel, it is essential for Chinese companies to take precautions for a worst-case scenario and consider placing their India investment and production plans on hold until the border crisis between the two neighbours is resolved,” advises the GT to Chinese manufacturing giants.

However, OnePlus, another China-based smartphone maker with prices higher than the top five selling brands witnessed its latest model being sold rapidly in India on Thursday, despite the repeated calls for a boycott.

Indian Government at the rescue?

While maintaining the warning for India to quit the anti-China fever, the GT goes on to ask the Indian government to “offer the necessary protection for all Chinese personnel, as well as all Chinese businesses and their assets in the country.”

Earlier in 2017, Indians had destroyed some mobile outlets to showcase their support for Indian army amidst similar troubles with China at the border.

The GT presses the “people to show rationality in the face of the border tension so as to maintain the stability of bilateral economic and trade ties.”

Meanwhile, it continues to clear the air about repercussions as, it says that “But if they (Indian government) fails, then it would also be the people who will bear the negative outcomes, and, Indians may suffer more losses than their Chinese neighbours.”

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Economy

MBA vs PGDM: Why MBA Degree Is Better Than AICTE PGDM?

MBA vs PGDM: Experts from PGDM Colleges call MBA programs Outdated, while MBA colleges call PGDM program a mere Diploma. An MDI Gurgaon Alumni explains why MBA is Better than a PGDM.

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MBA vs PGDM is an ongoing debate, but what is the difference between MBA and PGDM and which is a better program between the two remains a big question for aspiring management students.

Students aspiring to get into Top Business School are searching for the best pathway to achieve their goals. As the entrance season advances, the dilemma for the management aspirants continues – MBA vs PGDM and which Business School to opt for?

EurAsian Times analyses the difference between the two programs and analyses why an MBA Degree could have more advantages than a PGDM Program.

The confusion to select a PGDM or MBA course reaches the peak when the students start visiting the colleges for counselling and GD/PI sessions. All business schools boast about their Excellent Placements Record, Faculty from the IIM’s and IIT’s, International Exposure, etc leaving the management aspirant in a total state of confusion.

What adds to the confusion level are the Education Consultants who further confuse the students for their petty monetary gains. At some point in time, students get so frustrated that they stop taking all the calls for admissions. EurAsian Times crisply attempts to explain the difference between MBA and PGDM.

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MBA vs PGDM: What’s the Difference?

Master’s in Business Administration (MBA) is a degree course provided by the University or colleges recognized by the Universities which are approved by University Grants Commission (UGC), and sometimes also by All India Council for Technical Education (AICTE).

Post Graduate Diploma in Management (PGDM) is also a Masters’s degree program, offered by the autonomous institute or colleges, that have received their approvals from the All India Council for Technical Education (AICTE).

Some of the top business schools like IIM’s and ISB’s offer PGDM / PGPM program (and strangely they are not approved by the AICTE) as they do not have collaboration with any University. But these B-Schools have an outstanding placement record and great international reputation and do not bother about AICTE approvals. Neither do the organizations show any concern or preference.

Colleges offering the MBA program follow the academic syllabus provided by Universities (which usually cannot be easily modified or changed) while PGDM syllabus is flexible and institutes like IMT, MDI, XLRI, IIFT, SP Jain, NMIMS have the flexibility to modify their course within the AICTE approved parameters giving them a tremendous advantage.

Which Program is Better – MBA or PGDM?

MBA vs PGDM is an unending debate and honestly, a lot depends on which University or College a student is getting (based on entrance exam score like CAT / XAT / MAT etc) rather than the program itself i.e. MBA or PGDM. The PGDM program claims to follow a more practical approach to studies, compared to the MBA (which is not always true).

MBA from top institutions like FMS, IIT, DTU are equally acceptable and sought after in the market. The major difference between MBA and PGDM is that MBA course fee is usually less than the PGDM program, as PGDM comes with a variety of industrial trips, international exposure programs, besides being a revenue generation model for the institutions. (A PGDM Program at the IIM’s could cost up to 28 Lacs, whereas MBA from FMS-Delhi University would only cost about 2 Lacs).

Best Business Schools in India: 5 Points To Know Before Selecting A Business School In India?

Corporates recognize talent from both the programs and are more interested in better brands and students, and don’t really care about MBA or PGDM. Students have an apprehension that after PGDM, they would not be able to pursue higher studies like PhD but if a PGDM is AIU approved, students will be eligible for PhD programs as well.

However, be assured that having a PGDM Degree instead of MBA degree will not make any difference to your corporate career in India, as at the end, it is the student who matters!.

SP Jain Himself Reviews Global MBA / Executive MBA Program @ SP Jain School Of Global Management

The students need to be very clear about their choice of the PGDM or MBA program and institute they are opting for. Students must evaluate the brand of business school, as a business school with higher brand value will provide a good learning environment and a large network of alumni.

MBA vs PGDM: Which is Finally Better?

Both the programs i.e. MBA and PGDM are good and very similar. What matters most is the business school you are getting, based on your score. Which Business School would you choose – MBA from FMS-Delhi University or PGDM from IIM-Lucknow?

Better ROI: If I had to make a choice, I would certainly choose FMS-DU as the fee is drastically less than IIM-Lucknow and return on investment is much much faster. However, there is a dearth of top-notch Universities providing MBA Programs, and students have no option but to opt for expensive PGDM programs.

Government Jobs in India: Besides the corporate sector, many government organizations still, unfortunately, do not recognize the PGDM Diploma and Government Jobs is one area where MBA Degree holders will have an edge over others.

International Jobs: If you ever opt for immigration or overseas opportunities, chances are your PGDM will either not be recognized or valued as high as an MBA Degree. Even the IIM’s have been striving to provide MBA programs rather than Diplomas and once that happens, the PGDM programs will lose the sheen and colleges would lose massive business.

AIU Approved PGDM Colleges – How Vital is the AIU Approval For PGDM Institutes In India?

 

 

Key Differences Between MBA and PGDM

Parameter
MBA from Govt. University
MBA from Private University
Indian Institutes of Management (IIMs)
Private PGDM Colleges
Programme offered
Masters of Business Administration
Masters of Business Administration
Post Graduate Programme in Management(PGP)
Post Graduate Diploma in Management (PGDM)
Award
Degree
Degree
Diploma
Diploma
Number of programme offering institutes
2000+
500
20
500
Top Institutes/colleges
FMS – Delhi University; IIFT Delhi-Deemed University; JBIMS – Mumbai University; PUMBA-Pune University
Affiliated colleges of Govt Universities like Anna University, Bangalore University etc.
Top Private Universities are NMIMS-Mumbai; Symbiosis –Pune; XIM-XUB Bhubaneswar.
More than 100 Private Universities offer MBA
IIM Ahmedabad, IIM Bangalore, IIM Calcutta, IIM Lucknow, IIM Indore, IIM Kozhikode and other 14 new and newest IIMs
XLRI, SPJIMR, MDI, IMI, IMT, TAPMI, KJ Somaiya, BIMTECH, …
Degree/Diploma recognized/approved by
University Grants Commission (UGC)
University Grants Commission (UGC)
Recognized by Ministry of HRD
All India Council for Technical Education (AICTE)
Curriculum
Rigid, because approvals required from University
The curriculum at most Government Universities and Colleges is theoretical, and not frequently updated.
The curriculum at good Private Universities like NMIMS and Symbiosis is at Par with IIMs, top PGDM B-schools.
Flexible and Frequently Updated.
Focus on Industry needs and job requirements as Placement is key student expectation.
Flexible and Frequently Updated.
Focus on Industry needs and job requirements as Placement is key student expectation.
Programme suitable for
MBA offered by Government Universities is more suitable for candidates interested in earning a Degree for higher studies, academic career.
MBA offered by top Private Universities is good for both corporate career and academics.
Students focus on enhancing their employability skills for a better corporate career, job or starting their own enterprise.
Students focus on enhancing their employability skills for a better corporate career, job or starting their own enterprise.
Fee
Fee at Government University/Colleges is low. FMS Delhi fee is just Rs 25,000 for the full MBA course.
Bangalore University prescribes 2-year fee of fewer than 200,000 lakhs.
Private University MBA fee is at par with IIMs, PGDM B-schools based on their market acceptance.
NMIMS Mumbai fee is Rs. 17.44 lakhs; SIBM Pune fee is Rs. 18.25 lakhs
IIMs have a comparatively higher fee structure.
IIM Ahmedabad fee is Rs.21 lakhs, IIM Bangalore fee is Rs.19.5 lakhs, IIM Calcutta fee is Rs.19 lakhs.
Top PGDM B-schools charge between Rs 10 lakhs to Rs20 lakhs for 2 year MBA.
SPJIMR fee is Rs. 16 lakhs, MDI Gurgaon fee is Rs.18.89 lakhs, IMI New Delhi fee is Rs. 15.41 lakhs
Fee for many good PGDM B-schools is between Rs. 5-10 lakhs also.
Programme duration
Two years
Two years
Two years
Two years
Exam conducted by
University
University
By the Individual IIM
By individual College/
Institute
Admission Process & Entrance Test
Some Govt. Central Universities and their colleges accept National level entrance tests like CAT/XAT and/or also conduct their own entrance tests.
Most Government colleges governed by State Governments, admit thru state level examination like MAHCET, PGCET, TANCET, although these colleges.
Top Private Universities conduct their own exams like NMAT, SNAP, X-GMT
Common Admission Test (CAT) conducted by IIMs, is the mandatory entrance exam for Indian residents
B-schools can choose from one or many of 6 approved exams: CAT, XAT, CMAT, MAT, GMAT, ATMA

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