Author: Arun Sreenivasan

Govt to fund gene therapy research on NCDs, rare diseases 

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The central government has decided to support research on gene therapy in a big way to tackle India’s escalating burden of non-communicable diseases (NCDs) and inherited critical disorders such as spinal muscular atrophy (SMA), thalassemia and haemophilia. Scientific institutions and universities conducting research on genomics and its therapeutic applications will soon get a financial fillip from public coffers, under an initiative facilitated and funded by the Indian Council of Medical Research (ICMR).

Gene therapy is a technique that uses genetic modifications to treat or prevent diseases. The experimental technique allows clinicians to treat a disorder by inserting a gene into a patient’s cells instead of using drugs or surgery or replacing a mutated gene that causes diseases with a healthy copy of it.

According to the proposal note, a copy which CNBCTV18.com has reviewed, the funds will be disbursed for research projects across various therapeutic areas including gene editing, gene transfer techniques and immunotherapy based on genetic modifications. The apex body for biomedical research promotion has already started accepting proposals from scientists and clinicians.

Why gene therapy is crucial 

In the current era of genomics and genetic testing, it is evident that a large swath of the Indian population harbours causative mutations leading to various disorders. Conversely, for many inherited and complex disorders, the underlying genetic causes are known.

And most of these illnesses are currently not treatable by molecule drugs or traditional therapies. According to patient advocacy groups, though there are major developments in gene therapy for cancer and other chronic diseases in the developed world, most of them are not accessible or affordable to a majority of the Indian population.

For instance, the US Food and Drug Administration (FDA) recently approved Zolgensma, the first gene therapy to treat children less than two years of age with SMA, a leading genetic cause of infant mortality. Though the drug’s clinical trial in older SMA-affected children remains partially halted because of an inflammatory response observed in an animal study, there are very few options left for these patients.

“Majority of these rare diseases, including SMA, are progressive and require life-long treatment and continuous support,” says Archana Panda, co-founder of Cure SMA India, a non-profit group that works for making SMA treatment accessible to Indians.

In the case of SMA, a disease that leads to loss of motor neurons and early death, Nusinersen is the only drug approved by the US FDA. Developed by US-biotech major Biogen and marketed as Spinraza, the drug is administered directly to the central nervous system intravenously and the therapy could cost around $750,000 in the first year.

But in recent years, significant strides have been made in the field of gene therapy. This has culminated in the recent FDA approvals for Luxturna (gene therapy for retinitis pigmentosa) and Yescarta (CAR-T cell therapy for lymphoma). Many such approaches are currently under investigation or in early clinical trials. Now, the ICMR-backed initiative “aims to fill the gaps in research thrust in India by providing emphasis on the focus areas which require more attention to address the needs for the large existing patient base”, the note reads.

Hope on the horizon for patients

Apart from multi-factorial diseases such as cancer, diabetes and lung ailments, the research will also focus on treatment for rare diseases such as neuro-muscular diseases (including Duchenne muscular dystrophy, Becker muscular dystrophy, SMA and myopathies), retinal or corneal disorders (including Retinitis Pigmentosa, Stargardt disease and Fuch’s dystrophy), inherited heart diseases and blood disorders including Thalassemia, Sickle Cell Disease and haemophilia.

The initiative assumes significance as it is estimated that one in 20 Indians is affected by one of the 7,000 diseases listed by the World Health Organisation as rare diseases. For many of these illnesses, gene therapy is the final hope. About 16 lakh Indians are diagnosed with cancer every year, and 8 lakh people lose their life to the disease.

While the fund support for research which can lead to human trials is only a baby step, experts such as Dr Mamta Muranjan, who heads the Genetic Clinic at KEM Hospital in Mumbai, emphasise the need for such focused long-term policies. “Most patients with rare diseases remain undiagnosed for a long time. Even if the diagnosis is on time, the family of the patient is usually unable to afford the treatment cost. Insurance policies generally do not cover these life-long treatment expenses,” she says.

Possibility of translation into human trials

According to official sources, the three-year state-funded research projects would be selected on the basis of their potential for development of functional treatment options. The strategies proposed should have the possibility of translation into future human trials.

The ICMR’s task force studies are national initiatives that are centrally planned, coordinated and implemented on a multi-centric basis. The projects have defined targets and specific timeframes. They are formulated after considering the national priority areas of research and aims at identifying collaborating scientists with expertise and infrastructure.

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How safe are your cosmetics? Products containing toxic chemicals sold as beauty-care items

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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While the Indian beauty and cosmetics market is booming, thanks to the rising demand for personal care products from the youth, the sector is largely operating in a vacuum in terms of regulations and safety, raising concerns among public-health advocates.

At present, most of the personal care products, categorised as hair care, skin care, bath and shower products, makeup and colour, fragrances and deodorants, are regulated under the provisions of the Drugs and Cosmetics (D&C) Act, which, according to industry experts, are absolutely inadequate. Though the health ministry had notified a draft regulatory framework for cosmetics towards the end of 2018 in view of the current laws’ ineffectualness, the ‘Cosmetics Rules, 2018’ is yet to see the light of the day and remain snarled in red tape.

The upshot — numerous products, many of them containing potentially toxic chemicals, are sold in the market without any regulatory watch.

The problem with lack of regulations

The new regulations were proposed as the D&C Act focuses mainly on medications. Only seven of the 169 sections in the existing Act refer to cosmetic products. In the absence of separate rules, the safety of many of the cosmetics products sold in the domestic market is now up to the discretion of manufacturers and importers.

All cosmetic products that are manufactured or imported for sale in India need to be registered with the state or central licensing authority. But owing to the absence of regulations, numerous products, many potentially hazardous, are sold in the market with abandon. “For instance, imported beauty products such as artificial nails, adhesives for hair fixing, certain products for hair straightening and artificial eyelashes don’t come under the existing rules and are sold without effective oversight. The government will soon classify these products as cosmetics and regulate them under the provisions of the D&C Act. We are now reviewing inputs from various stakeholders,” a health ministry official said on condition of anonymity.

Products like these are imported and sold without checks. “The government’s intention seems to be to regulate these products under the existing legislation as the Cosmetics Rules are not yet finalised,” Federation of Pharma Entrepreneurs (Fope) co-chairman Vinod Kalani told CNBC-TV18. 

Beauty might be only skin-deep, but the maxim has no bearing on the Indian cosmetics market, which is expected to touch $20 billion by 2025. Despite a slowdown in the consumption of consumer goods, the country’s per capita spending on personal care items is rising quickly and the market is projected to grow at a compounded annual growth rate of over 18 percent in the coming years, according to industry estimates.

What happens on the ground: A reality check

While the move to classify more unregulated products as cosmetics and regulate them under the D&C Act is a welcome step, the truth is that there is no specific provision under the Act for the approval of personal care items. Even now, in many states, the permission is given only on the name of the product and the detailed composition or ingredient list is not mentioned in the licence issued to manufacturers. During investigation of complaint or sample analysis, drug inspectors often detect many harmful ingredients that should not be a part of cosmetics.

According to a former drug controller, substances such as phenol and trichloroacetic acid are often found in even licensed beauty products during sample analysis. While these products have displayed efficacy in treating acne scars, numerous new studies have shown that their usage can result in severe health hazards. “Since the final product will have a valid licence and the composition won’t be mentioned in the approval certificate, many unscrupulous elements escape without facing any punitive action,” he said.

As more women are opting for hair extensions and men look for imported hair patches to cover bald spots, concerned health experts call for steps to regulate rampant use of hair adhesives. Latex is a common ingredient in most wig adhesives, which can cause itching, burning and irritation to the scalp. Another common chemical in hair glue is opropanol, which is harmful to eyes, throat and nose.

Earlier this year, the government banned the over-the-counter sales of ointments containing hydroquinone, a bleaching agent for reducing skin pigmentation, and steroid-laced formulations for topical application to curb their indiscriminate use by beauty parlours and quacks. Hydroquinone — also termed Benzene 1,4-diol or quinol on product packages — is usually found in bleaching creams, skin lighteners, pigment gels, spot treatments and many popular anti-aging products. The chemical is added to work as a primary ingredient in skin lightening products.

“Many of these creams are often used without medical guidance for fairness, and even beauticians prescribe them,” says Dr Ramesh Bhatt, eminent skin specialist and former president of Indian Association of Dermatologists, Venereologists and Leprologists.

Industry experts point to another inadequacy in the existing rules concerning percentage of ingredients mentioned on cosmetics labels. Though there is provision to mention the ingredient list on packets, their percentage is not mandatory.

Under BIS 4707, certain ingredients are allowed in cosmetics with restrictions on their percentages and some are allowed for only a particular class of cosmetics. But without a detailed sample analysis, the regulators find it tough to ascertain the percentage of ingredients.

The new draft regulations propose stringent measures to ensure safety of cosmetics and they also cover imported items. Companies launching new products have to submit safety data to the regulator for getting approvals.

There are provisions for inspecting manufacturing facilities, sampling of products and confiscation in case of violations. The companies also have to keep details of product batches and raw materials for at least three years. The manufacturers have to follow strict labelling norms and can’t make false or misleading claims.

But industry representatives term some of the propositions as too rigid, particularly for the small enterprises. “Certain clauses, for instance listing of the applicable Bureau of Indian Standards norms, are constructive. However, plan to conduct Centre-state joint inspections of manufacturing sites will only delay the licensing process. This could create additional bottlenecks,” said a representative of the All India Cosmetic Manufacturers’ Association.

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How air pollution took lives and shielded a serial killer in London over 50 years ago

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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“A great chocolate-coloured pall lowered over heaven…there would be a glow of rich, lurid brown, like the light of some strange conflagration; and here, for a moment, the fog would be quite broken up, and a haggard shaft of daylight would glance in between the swirling wreaths.” That’s not a description of North India during a bad air day, even though could well be. It is, instead, a London scene from RL Stevenson’s The Strange Case of Dr Jekyll and Mr Hyde, published in 1886.

Such scenes were common in London from the mid-nineteenth century, as the Industrial Revolution spread its tentacles. Visitors to the city felt cheated if they didn’t experience these “London particulars” and pea-soupers at first hand. Novelists incorporated it into their work to create ominous settings and metaphors, especially Charles Dickens, the beginning of whose Bleak House is still unforgettable. The city’s fog became an essential backdrop for real-life characters such as Jack the Ripper as he prowled for prey in Whitechapel, and fictional detectives such as Sherlock Holmes as he hailed a hackney from Baker Street. “Without fog, London would not be beautiful,” Claude Monet exclaimed as he looked with an artist’s eye at the shrouded vistas of Waterloo Bridge, Charing Cross Railway Bridge and the Houses of Parliament in the early 1900s.

The Great Smog of London

Picturesque it may have been, but the fog’s deleterious health effects had been observed for quite a while. There was also concern over incidents of crime and disorder on murky streets and byways. Preventive measures were, however, half-hearted. Politicians and others pointed to a lack of options other than coal for heating, and some claimed that economic growth was a priority. A decisive change in public attitudes only came about as late as in 1952, the winter of which was blighted by the terrible event known as the Great Smog of London.

In her book, Death in the Air, Kate Winkler Dawson illustrates how this fog spread, the effect on the man, woman and child on the street, and the shift in stance towards air pollution. That isn’t all her book deals with. It is the parallel story of two killers: “One was a toxin that ignored race, wealth, and age — a mass murderer that asphyxiated thousands of Londoners and sickened hundreds of thousands. The other was a psychopath, a serial killer, who terrorized one of the world’s most important cities.”

This latter killer was one John Reginald Christie, a soft-spoken but thoroughly unpleasant fellow in his mid-50s at the time of his arrest. He was a necrophiliac who killed at least eight people – primarily girls he chatted with at local cafés — largely by means of a contraption in which a rubber tube emitted cooking gas. Christie disposed of the bodies in his coal cupboard, garden, and under the floorboards of his Notting Hill flat. After his capture and confession in 1953, London’s enterprising tabloids were quick to dub him “Jack the Strangler” and “the Notting Hill Killer” and even Madame Tussaud’s, ever responsive to public mood, displayed a wax figure of Christie preparing to be hanged.

Dawson’s book tries to interweave the story of the 1952 fog and of Christie’s actions. On the page, however, they sit uneasily side by side, forming separate halves rather than resonating with each other. Dawson’s attempt to fit the timelines together, for a start, can be confusing. The Great Smog of London lasted for five days in December 1952, with the effects being felt over the next year as well as in subsequent Parliamentary discussions and legislation. Christie’s murders, meanwhile, went on for ten years, ending only when he was apprehended in 1953.

More pertinent to our time is the light Dawson throws on the gloom of the smog. At the time, millions of domestic coal-burning grates, the major source of heating, were stuffed into an area of just six hundred square miles. With a high-pressure weather system caused by the Gulf Stream’s warm, moist air, the sulphur dioxide trapped in the air became deadly.

As visibility dropped, ships were docked, planes at London’s airports grounded, double-deckers halted mid-route, and automobile drivers urged to stay home. The Underground was packed with passengers as trains sat, delayed, on the tracks. Major thoroughfares were lit by flaming torches, offering pedestrians scant relief. (Some of this is captured in an early episode of Netflix’s The Crown.)

So thick and widespread was the fog that a performance of La Traviata at Sadler’s Wells theatre had to be stopped after the first act because the audience could no longer see the stage. Cinema halls, too, turned off their projectors as screens became obscured. In an echo of AQI measurements in India, many pollution-measuring devices were rendered useless because of high emissions.

People thronged emergency rooms with respiratory and cardiac diseases, while ambulance calls increased by a third. Funeral directors reported a surge in bodies, making caskets scarce. After the fog lifted, initial estimates put the number of lives lost at 4,000; this figure rose to 12,000 mainly due to pre-existing respiratory conditions. Dawson’s book brings all this to life largely by means of accounts by those who lived through those awful days: from a teenager who lost her father, to recollections of doctors and nurses, among others.

The Clean Air Act

Pushed and prodded by opposition MPs and others, the government set up a committee led by civil engineer Sir Hugh Beaver which, in its December 1953 report, pointed to causes such as the use of coal in domestic hearths, locomotives and power stations, as well as the city’s new diesel buses which had replaced the electric tram system. It was this report that led to the 1956 Clean Air Act, a milestone in environmental protection. It tightened restrictions on industrial smoke, banned coal in many domestic and industrial areas, and shifted sources of heat toward cleaner fuels such as electricity and gas. In doing so, it made the Great Smog the last major air pollution event in Britain’s history.

Dawson highlights the efforts of those who, by their tenacity, made this possible. In particular, she shows how Labour parliamentarian Norman Dodds and his cohorts constantly raised the issue in Parliament, even when it was in danger of being forgotten once clearer skies were visible. In this, they were aided by the National Smoke Abatement Society, an independent coalition of politicians, medical officers, reporters, lawyers and health professionals. The lesson, all these decades later, is clear: don’t let go, and don’t give up.

Sanjay Sipahimalani is a Mumbai-based writer and reviewer.

Read his columns here.

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Medical devices are now ‘drugs’: Upset industry calls for separate regulations

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The government’s decision to bring all medical devices and diagnostic equipment sold in India under the purview of the Drugs and Cosmetics (D&C) Act of 1940, but some with just a one-year transition period and others with three-four years, instead of implementing an exclusive regulatory mechanism has left the industry baffled. As government think tank NITI Aayog is reportedly working on a draft Act, the details of which are awaited anxiously, these notifications are “seemingly a parallel exercise and uncoordinated”, industry veterans say.

According to the draft notification reviewed by CNBC-TV18, the health ministry, in consultation with the Drugs Technical Advisory Board, has defined all medical devices “intended for use in human beings or animals as drugs’ with effect from December 1, 2019. Through a separate circular, ultra-sound machine was also added to the notified list. From November 1 next year, import, manufacture and sale of these machines will be allowed only under the legal ambit of the D&C Act.

What are the problems with the new rules?

Once a medical device is notified, manufacturers and importers will have to get the approval of the Central Drugs Standard Control Organisation, the national drug regulatory body, to sell these products in the domestic market. Earlier this year, the health ministry had decided to add all implantables, along with CT scan equipment, MRI equipment, defibrillators, dialysis machine, PET and X-Ray machines, and bone marrow cell separator to the notified list. This rule will come into force in April 2020.

At present, India doesn’t have a comprehensive law to ensure the quality and safety of medical devices and they are regulated as ‘drugs’. A medical device regulatory bill, first drafted a decade ago, is yet to take effect and another draft has reportedly been lying with the ministry since 2016. Though an exclusive Medical Device Rules (MDR) came into effect early this year, these products are still regulated as ‘drugs’.

While, the rationality of regulating a medical device, an electro-mechanical unit, as ‘drug’, is questionable, only 23 devices are notified and monitored by the government under the D&C Act. There are more than 6,000 medical devices available in the market, leaving the majority of them completely unregulated. The country currently imports 80-90 percent of medical devices of the $15 billion market.

Instead of adhoc addition to the notified list, the domestic manufacturers had suggested a list of 38 medical device categories to be regulated on a priority basis, considering their risk proportion, followed by voluntary registration for all devices and then a phased in mandatory regulations for all devices under a separate Act. However, their suggestions remain largely ignored.

Why is the industry upset with the new rules?

Rajiv Nath, forum coordinator, Association of Indian Medical Device Industry, said the government continues to shock the industry with its cherry-picking approach, adding that the manufacturers have been confused with informal and arbitrary choosing of products and notifying them as ‘drugs’. “We seek a predictable and comprehensive regulatory framework that allows for adequate transition. Only then will investments speed up as companies get discouraged to be regulated as drugs, especially item by item and not as a category,” he told CNBC-TV18. 

Like many others in the industry, he is anxiously waiting for the NITI Aayog draft Act. Nath said such notifications are seemingly a parallel exercise and uncoordinated, given NITI Aayog’s similar effort.

In the case of ultra-sound machines, the Pre-Conception and Pre-Natal Diagnostic Techniques Act, 1994, currently regulates the sale of these machines to entities registered under the law. Now, under the MDR and the D&C Act, the government will regulate additionally the import and manufacturing of the equipment.

The Drug Controller General of India recently unveiled a roadmap to regulate all devices in a phased manner and assured an adequate transition period of nearly four years for high-risk devices. “The one-year transition period is not as per the assurance given to the industry,” Nath noted.

According to industry insiders, the one-year transition is impossible as the regulator has to define the applicable product and horizontal standards, the tests involved and their frequency, the testing equipment and which tests will be permitted to be outsourced to accredited laboratories. Another impediment is the training and competence of regulatory officers and auditors familiar with the technology and subject expertise. “Countries such as Australia, Canada, Singapore and the EU nations provide a 3-5 year transition period so that mandatory regulatory requirements won’t disrupt the supply chain,” an industry executive said.

The government decision is cheered by the Medical Technology Association of India (MTaI), a lobby group representing multinational companies such as Abbott, Boston Scientific and Medtronic. “The health ministry’s proposal to regulate all medical devices will allow Indian patients the access to quality medical devices and put a check on garage manufacturing. The CDSCO under the Ministry of Health and Family Welfare has the most experience and over time have built the expertise to regulate this intricate medical device sector,” said Pavan Choudary, director general and chairman of MTaI. “Bringing all medical devices under regulation has been a long-pending demand from the industry and it is encouraging to see the government taking cognisance of industry concerns.”

Regulating medical devices in accordance with their risk profile is crucial. A recent analysis by the Associated Press has shown that collectively, insulin pumps and their components are responsible for the highest overall number of malfunction, injury and death reports in the US Food and Drug Administration’s medical device database since 2008. In terms of injuries alone, insulin pumps were second only to metal hip replacements.

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The Rum Diary: A guide to ultra-premium category of dark rums

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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In the early 2000s, it was Japanese whisky. Then came vodka, and that was followed by gin. Now, it appears as though rum is finally getting its due. For all you know, it might be a false dawn, but we, lovers of fine rum, will take what we get. According to the likes of Bloomberg and yet more focused purveyors of the drinking scene, ‘gin fatigue’ has set in the west, and curiosity about, and acceptance of, rum is on the rise. This is fuelled in part by its affordability as well as its geniality (it is, after all a highly mixable spirit).

But this piece is not about rum, usually white, that go into cocktails such as the daiquiri. Instead, it seeks to extoll the virtues of several fine varieties of dark rum that can be, and deserved to be, sipped on their own. Like this Santa Teresa 1796 rum that I was gifted recently and which I’m imbibing — with only a splash of water — as I write this piece. Santa Teresa is a rich, dense, smooth molasses-based rum. (The other type, rhum agricole, is made from fermenting cane juice, and is popular in the French Caribbean islands).

It’s got bold flavours, probably tastes like a resplendent summer evening in Venezuela, where it is made, and as a rum aficionado, I’d like to see it in more people’s hands this winter. Mumbai-based fine spirits curator Keshav Prakash thinks that will happen, though gradually.

Discovery behaviour

“Global trends hit India at least three to four years after they take root in the west. But certainly, the young consumer has started to exhibit, what I would call, ‘discovery behaviour’, and one of the beneficiaries of that could be the ultra-premium category of dark rums, especially spirits that contain no sugar additives or colouring.” Plus, says Prakash, rum has a story behind it as compelling as whisky. “Some of the distilleries in the Caribbean have a storied history. Rum, of course, fuelled the slave trade, and is, after all, among sugar production’s bitter legacies.”

Sukhinder Singh, who runs London-based The Whisky Exchange, the world’s biggest online drinks retailer, is not so sure about whether a ‘gin fatigue’ has set in. “There probably are too many brands out there right now. Only the best ones will survive, and people could move to rum,” says Singh. The Whisky Exchange recently introduced a classification of rum. “Distilleries add sugar, add colour, caramel, but don’t necessarily provide accurate information. That’s what we are trying to set right,” says Singh.

According to Singh, there is more to rum than whether it is made from molasses or cane juice. “Just take the Caribbean, for instance. You have rums that are a blend of pot still and traditional column still; then you have twin column stills and single column stills. Each of these aspects impact the way a rum tastes.”

Top brands to look for 

This writer might love rum, but he is by no means an expert. So, I asked Prakash and Singh to recco fine rum for those who have started to get curious about it. Here, then, are some of the brands to look for.

Doorly’s: Doorlys is among the rums made by Foursquare distillery in Barbados, which is widely acknowledged to be one of the world’s best. “They have several aged rums, but their 14 Year Old is exceptional. If you can’t get Foursquare, get this,” says Singh who also recently launched

Black Tot on The Whisky Exchange. “Black Tot is a blend of three rum-making philosophies from the Caribbean — Barbadian, Jamaican and Guyanese — and I’d like to think, it’s got the best bits from the three countries.”

El Dorado: “The Demerara region in Guyana produces some seriously good rums. The El Dorado 12 YO is among them,” says Prakash. “It’s full-bodied and yet mellow, and has a fantastic finish.” He also rates the Plantation range of rums highly. Plantation, which selects, ages and blends several rums across the Caribbean, is owned by the Cognac, France-based boutique company, Maison Ferrand. “Another of my favourites is Trois Rivieres, from Martinique. If you want to find out more about rhum agricole (the French term for cane juice rum), this is a great way to start.”

Murali K Menon works on content strategy at HaymarketSAC..

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Why the success of Air India’s SPV bond sale will not rub off on its stake sale

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The government recently concluded the second private placement bond offering for the special purpose vehicle (SPV) created to address Air India’s balance sheet woes. This is the second series of the offering. Or more accurately for the redeemable, unsecured, taxable, non-convertible debentures backed by a government guarantee and being referred to as bonds. The offering signals strong intent of the government towards privatising Air India, yet the success of the offering cannot be confused in any manner with any success at Air India.

The SPV is essential to the balance-sheet cleanup at Air India

The bond offering was done on behalf of the SPV named Air India Asset Holdings Limited (AIAHL). This was set up to transfer Rs 29,464 crore of debt from Air India’s balance sheet. Effectively this leads to the national carrier’s debt burden being slashed by 50 percent. This amount in turn will be refinanced and subsequently serviced by the sale of non-core assets.

The SPV in turn will service the bonds by sale of assets. These include shares held in various subsidiaries, paintings, artifacts and other non-operational assets, non-core assets, immovable properties and moveable properties, intangible properties trademarks, brand names, goodwill, copyright, intellectual property rights, accumulated working capital loans not backed by any asset and other assets that may be decided by Air India and/or the Government of India.

Interestingly, the SPV may also hold claim to slots at airports, landing rights and operating rights. But again this has to be jointly decided by Air India and the Government of India. It can be assumed that any assets that the potential buyer is not willing to pay for may be transferred to the SPV.

Details of the bond offerings

The first bond offering in September this year, was priced at 6.99 percent and had a three-year and three month tenure of Rs 1,000 crore. Put simply, this means that the bond pays the buyer at a rate of 6.99 percent semi-annually (twice a year). The 6.99 percent is also of importance as it is higher than the three-year government bond yield and even higher than the 10-year treasury yield at the time of 6.73 percent while being backed by the full faith and credit of the Government of India. It was rated AAA by ICRA ratings.

The second offering was priced at 7.39 percent and had a ten year tenor of Rs 1,000 crore. Yet again this was higher than the 10-year treasury yield of 6.685 percent while being backed by the full faith and credit of the Government of India. It was also rated AAA by ICRA ratings.

Both bond offerings had a greenshoe option of Rs 6,000 crore. Cumulatively the offerings have enabled the SPV to raise Rs 14,000 crore. Additional bond issues are planned, including a Rs 15,064 crore issue that will have a maturity period of ten years.

The bond offerings being oversubscribed is being presented as a runway success. While it was a success, it is also worth repeating that this bond offering is government backed. Which translates to zero risk of default and a high trust factor and high safety for investors. This also allows for the debt in the SPV to be refinanced at a lower rate.

De-hyphenation is critical for investors interested in Air India

Some quarters have been linking the success of the bond offering to the interest in Air India or to the strength of the Air India brand. This is simply not the case.

In fact, as news of the success of the bond offering poured through, it was also reported that there was a mass resignation of first officers at Air India. If that was not bad enough, several oil companies also threatened to stop oil supply at six airports in case lump sum payments were not made by October 18.

Air India Limited and Air India Asset Holdings Limited continue to be two separate entities. In terms of a sale, any buyer that values Air India will use the enterprise value. For this the debt load has to be addressed else the valuation will just not attract investor interest. In creating the SPV the government has signalled seriousness and partially alleviated this concern. But more work remains. The current valuation and contingent liabilities do not lend themselves to a very attractive proposition.

For investors it is important to de-hyphenate the success of the bond offering with any success at Air India. Both are standalone entities and the success of the bond offering has no bearing on any success at Air India. Eventually it is Air India that is being sold and not the SPV. Thus, unwarranted attention on the success of the SPV is just that.

Satyendra Pandey has held a variety of assignments in aviation. He is the former head of strategy at a fast growing airline. Previously he was with the Centre for Aviation (CAPA) where he led the advisory and research teams. Satyendra has been involved in restructuring, scaling and turnarounds. 

Read his columns here.

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How to boost the rate of return on digital investment: Here are a few tips

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Innovation is key to really thriving these days. Surviving is an old game. To get ahead of the competition, enabling digital innovation is what companies need to do. To get started, companies can begin their assessment by asking themselves the following questions:

1. How much support can we provide to scaling efforts without jeopardising legacy products and services?
2. How do we think about deploying platforms, technologies, skills and ecosystem partners?
3. Do we focus on key organisational levers, like champions do?

Champions are those companies that are far ahead of the learning curve. In fact, they did their thinking, researching and implementing ahead of everyone else and hence benefitted from their foresight. So how does one become like that? The automotive interior manufacturer Faurecia launched a Digital Enterprise Strategy in 2016. This was to take their legacy operations to the next level, which will enable them to “capture 20-30 percent of the SUV/CUV/ Premium segment and a 60-80 percent share of new electric vehicle customers in 2025 as compared to 5 percent and 20 percent respectively in 2017”, stated an Accenture report.

To achieve the above, their factory has installed automated guided vehicles that transport parts within the plant. There is connected machinery in place for predictive maintenance and machine operators get help with repetitive tasks from co-bots. It also has leveraged its various acquisitions: Parrot, Clarion and Coagent Electronics to build the Cockpit of the Future and Cockpit Intelligence Platform.

That’s not all. They have shown interest in moving out of their comfort zone and have established scholars in academic research institutions and startups in innovation hubs, such as Silicon Valley, Toronto, Tel-Aviv, Shanghai and Paris, to ramp up development and industrialisation of emerging technologies in healthcare, cybersecurity and zero emissions.

A lot of corporates would like to emulate this and do so, but digital return on investment (ROI) has not been great for many of them. Accenture surveyed 1,350 global senior executives in key industrial sectors and found that “between 2016 and 2018, industrial companies spent a little over $100 billion on scaling digital innovations to drive new experiences and efficiencies.”

But 78 percent of industrial companies in the survey just about managed to achieve expected earnings and the remaining 22 percent achieved a return on their digital investments that was more than expected. What this latter group must have done right is that their approach was more strategic. They clearly identified the value they wanted to achieve and knew how their innovation efforts will affect their organisation. For such ‘champions’, it’s not just about earning more digital ROI – it’s about earning more by scaling better.

The laggards had challenges that need to be looked into and these were across discrete industries, such as those that assemble parts for auto and aircraft manufacturers and process companies, which make entire products in-house, like pharmaceuticals and chemicals. Research showed that discrete industries gained more than process industries from addressing the challenges. But process industries also showed significant returns on investment compared to not taking any sort of innovative step.

So what were the challenges? They were: skills deficit, alignment deficit, infrastructure deficit, cultural deficit, partnership and measurement deficit. Here are the easy definitions:

1. Alignment deficit: This occurs when top and middle management can’t decide on the definition of digital value, or on the proper ways to leverage assets, talent and ecosystems to create the same.
2. Infrastructure deficit: Inadequate technology architecture which makes collaborative innovation difficult. This can make it hard to manage complex integrations of services with products.
3. Skills deficit: Lack of adequate skills needed to identify, articulate, and innovate value through digital platforms and technologies.
4. Partnership deficit: Partners lack a shared view on how to build and scale data-driven, digital value.
5. Measurement deficit: The absence of processes and metrics to systematically track returns on digital investments. Lack of this data means informed innovation decisions can’t be made.
6. Cultural deficit: The absence of appropriate culture in the organisation, which allows for the design and development of digital customer experiences that can be monetised.

If these issues are addressed, companies can unlock almost double the rate of return on their digital investment. Even the champs can up their game by almost 3.5 percent, if they smoothen out any organisational culture issues, innovation hurdles, burden of legacy technology and tussles between the in-house team and the agile newcomers.

Champion companies have done this, so it’s not a miracle that happens rarely! They have managed this by defining the value so that innovation efforts are guided rather than stuck in the middle or with the top management. They have also focussed on internal organisational changes which mixed with digital transformation initiatives, have created an ‘ambidextrous’ organisation. Champions across discrete and process industries preferred to do this 10 percent more than other manufacturers – 62.2 percent of discrete manufacturers and 63.5 percent of process industries.

They also seed and build organic technology in-house with the help of new talent and the team already on their payroll. So both learn to work in sync and add value to the company’s products and services. Lastly, these winners use enablers — be it software, data-mining for relevant insights or support operations, and they match support to function in the best way possible, where it is most needed and will be most useful. Support can also come in the form of key new partnerships within the ecosystem.

Manali Rohinesh is a freelance writer who explores financial and non-financial subjects that pique her interest.

Read her columns here.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Mastering customer experience is the secret sauce for startup success: Here is how to do it

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Startups are often thought to be all about acquiring customers at rapid pace, and scale up to be a unicorn within a short span of time. A lot goes into perfecting the secret sauce of success, including marketing strategies, perfecting product, innovating technology, availing funding and more. However, one can only convert an early stage venture into a sustainable business when they are successful in building loyal customer base.

Businesses simply do not exist to sell products once — No! That temptation is not something that smart and scalable startups surrender to. They ideate, roll up their sleeves and step up to the plate – for not only getting a new customer on board but also to try and set a certain frequency for such a sale. This means relying on the number of times you serve the same client to help usher in sustainability. An integral part of customer management lies in customer retention — most businesses overlook this initially, and run the rat-race of new customer acquisition. A high quality customer experience begins at the first interaction with the brand – and continues through every stage of the relationship.

If you want to know how to enhance the customer service experience, then here’s something you need to know:

Setting the standards

Setting standards at all levels is important for branding exercise. What, how and where do you communicate as a business defines your brand perception. Also, it brings clarity to your clients on what to expect from you!

Communication channels

Being available to assist existing and prospective users is the first step towards achieving excellence in customer experience. And your availability may often boil down to the modes of communication you leverage to let customer connect to you. People tend to believe that social media comments and messages will avail them a faster response. However, they are often disappointed when they are not personally addressed on such platforms. Informing users as to where you are available is important. It helps in managing customer communication with limited resources, as you don’t have to chase multiple channels.

Maybe you can have an on-site chat option. That’s what we at Legalwiz.in do. We enable customers to contact us via chat where our dedicated personnel respond to their queries instantly. You may also have a toll-free number to make things easier. Also, tech advancements like smart chatbots who can process natural language help immensely to filter communication and also sort to concerned person within the team. It helps to create relevancy and personalisation in the process.

Communication frequency

There are times when you want to reach out to customers and it may not necessarily be for selling. Know how frequently you can communicate to customers and in what manner. This means, you can get in touch with them while they are placing an order and you observe if they are experiencing any issues. Again, after-sales communication is also necessary, hence setting up the frequency is imperative. Start by sending newsletters, service emailers, and feedback emails as well. Don’t overdo it. There must be a balance between promotional emails and newsletters. It keeps users informed while paving the way to keep them posted and feed them with updates. It is ideal to test the frequency of communication, along with the other attributes like language, tone, information, and more. Pick what suits your business, there is no cookie-cutter approach to success here.

Setting the tone

Tonality is vital. Every brand has a tone – depending upon the nature of business. For example, at LegalWiz.in, we follow an authoritative tone rather than an entertaining one which contributes to build brand perception. On the other hand, brands involved in selling fragrances (perfumes and deodorants) may apply a fun and contemporary tone. Having an authoritative tone for a kid’s brand is counter-productive. Therefore, engaging a certain tone to communicate with customers is important. Also, ensure that it remains constant across all modes and touchpoints (chat, phone calls and social media). It is also important to train all client-facing employees on how to represent brand over individual personalities for certain matters.

Staying available and informative

Distributing targeted as well as mass content is now easy, courtesy technology. This is done on a large scale without involving too many people in the process. Best to have e-mailers to inform and educate your audience regarding the use of your offerings and highlighting its USP. For example, if you are selling organic clothes, inform users that you use the non-Bt seeds which makes it a completely organic product. Be specific in sharing all the required product or service information.

Reinforce the initiative by communicating this to the people answering the customer care number so that they provide brief answers to customers’ queries. Staying available also means cutting down the queues in the customer care number and opening more channels to communicate. Apart from the online resources like FAQs and blogs, equip smart chatbots as well, to cater to user queries efficiently. At some point, human intervention is inevitable but try not to give just public information to the customers. Listen to them and personalise your communication wherever possible. Piggybacking on the first point, ‘staying available’ doesn’t need to be 24X7. However, that clarity is important to be made to the customers.

Balancing funds and resource allocation

Many startups make a huge mistake of allocating most of their limited resources to customer acquisition. Their websites and PRs talk high about how many customers they have served, but the point often missed out on, is how many of them they have served again, or vouched for their services to others. It is required to take a balanced approach here. Every business function needs resources – time and money to function seamlessly. Creating good customer experience needs efforts at various levels like educating customers about the product they purchased, keeping them engaged and encourage to regularly use the product or service, informing about what new is happening at the company, resolving their issues and queries, and anything else that makes a loyalty bond stronger.

Allocating resources across different customer touchpoints is crucial to communicate your post-sales availability. Since customer satisfaction is built gradually, you need to invest funds in all the stages of a product lifecycle to cater to users. Tailored after-sales service spreads positive word of mouth. You will have people buying your products not only for quality but also for how your service simplifies their lives after making the purchase.

Proactive feedback collection and leveraging technology

There’s no way to move further without looking back. Feedback does the same. It allows you to reflect upon your efforts and see how well you fared. Begin with getting feedback from users through various sources like social media, emails, and even making feedback calls. The idea is to proactively collect as much data as possible to evaluate yourself.

Technology has made this job simpler. At LegalWiz.in, this is perhaps the most critical function. We have a sophisticated review collection system that seamlessly integrates with our CRM. Each customer gets a review opportunity after service, and feedback on various customer service related aspects are taken – including website experience, ease of information pass-on, interactions with professionals, and final service outcome. Further, such reviews are quantified into Net Promoter Score, and a layer of NLP is used to analyse their text comments and sentiment analysis. So that we exactly know what is working right and what needs to be fixed. We command an exceptional 9.5/10 customer satisfaction rate, and more than 60 percent revenue MoM from repeat purchasers. Also, it has allowed us to convert people who once had bitter experience with us to now the biggest evangelist of our services within their networks. Also, it is important to hear what people are talking about your brand in social space. Quite a few softwares are available to track sentiments on social media.

Make policies that are reasonable and stick with them

When every business is raising their standards of customer service, and loosening their policies about refunds and returns, they are more vulnerable to being misused. Keep your policies reasonable, and stick to them. It is good to be customer-centric, but also important to make a call where you need to be assertive and push back. It is all about finding right customers for your brand. Even for the same service or product, what creates a value proposition changes from customer to customer. You need to define who should value your offerings, and craft a deal that appeals the specific group the most – it may be pricing, return policies, after-sales service, product innovation, or anything else. Invest most of your customer experience efforts on what will eventually be valued the most by people who are relevant.

In my business, I serve customers who are typically startups and small businesses. What they value is a price point, and more importantly the instant accessibility to professionals at LegalWiz.in that they don’t typically get with bigger firms. This proves to be a game changer for raising customer satisfaction standards. Done over and over again, it becomes a benchmark and inclusive part of the service persona. It creates an identity for your brand that people will recognise and refer.

Shrijay Sheth is the founder of Legalwiz.in.

Read Shrijay Sheth’s columns here.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Union Budget 2019: Sitharaman proposes zero-budget farming to double farmers’ income

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Finance Minister Nirmala Sitharaman has proposed zero-budget farming as a model for farmers in the country. Presenting her maiden budget in the parliament, the minister has said “steps such as this can help double farmer’s income.”

Zero budget farming is a set of farming methods that involve zero credit for agriculture and no use of chemical fertilisers. The farming movement was started in Karnataka as a result of collaboration between agriculturist Subhash Palekar and state farmers’ association Karnataka Rajya Raitha Sangha. As the initiative was a major success in Karnataka, the model was replicated in many other states, mainly in South Indian states.

According to its supporters, the model makes small scale farming a viable vocation.

In her budget speech, Sitharaman said the government would support private entrepreneurs in agriculture and focus more on agricultural infrastructure. “Ease of doing business and ease of living should apply to farmers,” he stated.

The government has created Jal Shakti Ministry by integrating many water management ministries. “To all rural households by 2024, water will be supplied. The government will explore additional funds for Jal Shakti,” the minister said.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Leadership lessons are learnt in the School of Hard Knocks — Anarock chairman Anuj Puri shares his management style

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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How do corporate leaders manage? Where do they draw inspiration from? CNBCTV18.com is publishing a series of interviews titled ‘My Management Mantra’ with experienced leaders who run major companies and oversee a large workforce. This one features Anuj Puri, Chairman, Anarock Property Consultants Private Limited.

What time do you like to be at your desk?

Unless I have client meetings in the morning, I prefer to arrive in the office at least an hour before everyone else. This gives me the time and space I need to set my priorities and get ready for the day ahead.

Where is the best place to prepare for leadership: at business school or on the job?

There is another institution which teaches valuable leadership lessons – the School of Hard Knocks. Apart from that, business school may give you an arsenal of leadership words and phrases, but it doesn’t give you the courage to use them or even the correct judgment on when and how to use them. Nor is a ‘business school dialect’ necessarily applicable or appropriate in all business situations in India. One definitely learns more about leadership on the job, but real leadership skills are not always learned by being involved in business situations. They are acquired by observing leaders in action. At Anarock, a degree from a reputed business school is mandatory – but after that, 50 percent of the leadership is fostered, mentored from the ground up.

Describe your management style.

I’ve read somewhere that lobsters lead from behind. I’m not a lobster. More seriously, I would describe my management style as ‘quiet perseverance’. A disconnected, loud and uncompassionate management stance leads to only one thing – an empty office. I never approach a management situation involving others without first putting myself in their shoes and judging for myself how I would like to be treated. It always works.

Are tough decisions best taken by one person or collectively?

Tough decisions should ideally be taken collaboratively, as no single mind can envision every possible solution or outcome. However, there are always some decisions which must be taken alone – and not necessarily by the senior-most person in the office. Team leaders have to learn how to take both collective and solo decisions, depending on what is best suited in a given situation.

Do you want to be liked, feared or respected?

I want to be collaborated with – but not at any cost. Therefore, fear cannot be a factor.

What does your support team look like?

With some notable exceptions, a lot like it looked like 10-15 years ago. I am a firm believer in long-term relationships and have strived not to let go of my most trusted partners. You could say that it looks like a fairly odd assortment of tough, seasoned pros with a calm demeanour interspersed by bright young faces with a spark in their eyes that reflects the fire in their hearts.

A business outside of real estate or a business leader that you draw inspiration from?

Ratan Tata comes readily to mind. His main talent is not in the various and very diverse businesses he has launched, but in a big heart of a true statesman tempered by the fierce intellect of an academic. It is almost impossible for such a man to fail at anything he does.

Which management book has influenced you the most?

I have read many, but few have surpassed the wisdom of The Arthashastra and Chanakya Sutras which were authored by Chanakya around 300 BC. I was fortunate enough to have attended a series of lectures on these when I was younger, and did a lot of follow-up reading after that. While their original purpose was to guide a ruler in how to manage an empire, they actually cover a lot of ground — including governance, economic policy, strategy and overall leadership qualities.

Do you socialise with your team outside of work?

All the time. This was a source of perennial complaints from my family in earlier years, but today work and leisure seem mingle effortlessly into each other for all of us. I probably don’t have much of a work-life balance; there is nothing to balance, because when I’m at work, I’m already among friends. For me, work and leisure are two sides of the same coin because they largely involve the same people. I don’t necessarily advocate such an approach to everyone – it must be a function of what work one does, and with whom.

What would your key management advice be?

Don’t take yourself too seriously. Take everyone else very seriously.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow