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FAST FOOD

History

The history of fast food started in America in July 7, 1912, with the opening of a fast food restaurant called the Automat in New York. The Automat was a cafeteria with its prepared foods behind small glass windows and coin-operated slots. Joseph Horn and Frank Hardart had already opened the first Horn & Hardart Automat in Philadelphia in 1902, but their “Automat” at Broadway and 13th Street, in New York City, created a sensation. Numerous Automat restaurants were built around the country to deal with the demand. Automats remained extremely popular throughout the 1920s and 1930s. The company also popularized the notion of “take-out” food, with their slogan “Less work for Mother”.

Some historians and secondary school textbooks concur that A&W, which opened in 1919 and began franchising in 1921, was the first fast food restaurant (E. Tavares). Thus, the American company White Castle is generally credited with opening the second fast-food outlet in Wichita, Kansas in 1921, selling hamburgers for five cents apiece from its inception and spawning numerous competitors and emulators. What is certain, however, is that White Castle made the first significant effort to standardize the food production in, look of, and operation of fast-food hamburger restaurants. William Ingram's and Walter Anderson's White Castle System created the first fast food supply chain to provide meat, buns, paper goods, and other supplies to their restaurants, pioneered the concept of the multistate hamburger restaurant chain, standardized the look and construction of the restaurants themselves, and even developed a construction division that manufactured and built the chain's prefabricated restaurant buildings. The McDonalds' Speedee Service System and, much later, Ray Kroc's McDonald's outlets and Hamburger University all built on principles, systems and practices that White Castle had already established between 1923 and 1932.

The hamburger restaurant most associated by the public with the term "fast food" was created by two brothers originally from Nashua, New Hampshire. Richard (Dick) and Maurice (Mac) McDonald opened a barbecue drive-in in 1940 in the city of San Bernardino, California. After discovering that most of their profits came from hamburgers, the brothers closed their restaurant for three months and reopened it in 1948 as a walk-up stand offering a simple menu of hamburgers, french fries, shakes, coffee, and Coca-Cola, served in disposable paper wrapping. As a result, they were able to produce hamburgers and fries constantly, without waiting for customer orders, and could serve them immediately; hamburgers cost 15 cents, about half the price at a typical diner. Their streamlined production method, which they named the "Speedee Service System" was influenced by the production line innovations of Henry Ford.

By 1954, The McDonald brothers' stand was restaurant equipment manufacturer Prince Castle's biggest purchaser of milkshake blending machines. Prince Castle salesman Ray Kroc traveled to California to discover why the company had purchased almost a dozen of the units as opposed to the normal one or two found in most restaurants of the time. Enticed by the success of the McDonald's concept, Kroc signed a franchise agreement with the brothers and began opening McDonald's restaurants in Illinois.[4] By 1961, Kroc had bought out the brothers and created what is now the modern McDonald's Corporation. One of the major parts of his business plan was to promote cleanliness of his restaurants to growing groups of Americans that had become aware of food safety issues. As part of his commitment to cleanliness, Kroc often took part in cleaning his own Des Plaines, Illinois outlet by hosing

down the garbage cans and scraping gum off the cement. Another concept Kroc added was great swaths of glass which enabled the customer to view the food preparation, a practice still found in chains such as Krispy Kreme. A clean atmosphere was only part of Kroc's grander plan which separated McDonald's from the rest of the competition and attributes to their great success. Kroc envisioned making his restaurants appeal to suburban families.[5]

At roughly the same time as Kroc was conceiving what eventually became McDonald's Corporation, two Miami, Florida businessmen, James McLamore and David Edgerton, opened a franchise of the predecessor to what is now the international fast food restaurant chain Burger King. McLamore had visited the original McDonald's hamburger stand belonging to the McDonald brothers; sensing potential in their innovative assembly line-based production system, he decided he wanted to open a similar operation of his own.[6][7] The two partners eventually decided to invest their money in Jacksonville, Florida-based Insta-Burger King. Originally opened in 1953, the founders and owners of the chain, Kieth J. Kramer and his wife's uncle Matthew Burns, opened their first stores around a piece of equipment known as the Insta-Broiler. The Insta-Broiler oven proved so successful at cooking burgers, they required all of their franchises to carry the device.[6] By 1959 McLamore and Edgarton were operating several locations within the Miami-Dade area and were growing at a fast clip. Despite the success of their operation, the partners discovered that the design of the insta-broiler made the unit's heating elements prone to degradation from the drippings of the beef patties. The pair eventually created a mechanized gas grill that avoided the problems by changing the way the meat patties were cooked in the unit. After the original company began to falter in 1959, it was purchased by McLamore and Edgerton who renamed the company Burger King.[8]

While fast food restaurants usually have a seating area in which customers can eat the food on the premises, orders are designed to be taken away, and traditional table service is rare. Orders are generally taken and paid for at a wide counter, with the customer waiting by the counter for a tray or container for their food. A "drive-through" service can allow customers to order and pick up food from their cars.

Nearly from its inception, fast food has been designed to be eaten "on the go" and often does not require traditional cutlery and is eaten as a finger food. Common menu items at fast food outlets include fish and chips, sandwiches, pitas, hamburgers, fried chicken, french fries, chicken nuggets, tacos, pizza, and ice cream, although many fast food restaurants offer "slower" foods like chili, mashed potatoes, and salads.

PAKISTAN

The concept of fast food restaurants came to Pakistan in the early 1980s. Since then there has been an increase market growth in this industry in Pakistan. Many international companies have stared there branches over there. Brands such as McDonalds, KFC, and Subway etc. are capturing the market at an increasing rate. There are lot of local fast food chains who are trying to settle in the market.

Pakistan is a relatively “young” country. Out of the estimated population of 173 million, the median age is approximately 20 years, with and about 104 million Pakistanis being below the age of 30. Pakistan is doing well among its immediate neighbours in terms of demographics but the growth rate of 2.05% is the highest, compared with China, India and Bangladesh.

(Tonnes) 7.46

The fast food chains in Pakistan have collectively over 200 outlets catering to more than 20,000 people at any one time. Pizza Hut has lead the market, with a more than 30% share, is the largest among the foreign and domestic fast food chains operating in the country. The shares of KFC and McDonald’s are estimated to be around 25% and 16%, respectively. Subway is the fourth largest player with a 7% market share, with the collective share of the other fast food players being almost 20%. The most interesting trend is of the growth of the fast food industry in Pakistan. In the last 10 years, the industry has shown phenomenal growth. From approximately 50 outlets in 2001, it has grown to over 201 outlets in 2010. The fast food industry in Pakistan commenced formally with the entry of McDonald’s, KFC and Pizza Hut in 1997-98. The industry grew at a rapid rate of almost 20% a year till 2007.However, the pace of growth reduced to just 10% a year from 2008 to 2010.

Industry InvestmentsResponding to the consistent growth of the fast food and snack food sector in Pakistan, the oils and fats industry, realising the importance of value addition, has expanded further by investing in fractionation plants. Currently there are more than four leading oils and fats manufacturers who are producing specialised palm-based frying oils for the fast food industry in commercial packaging. These products are being used by both national and international snack food and fast food companies in Pakistan and this sector shows great potential in future.

Political Risks:

1) An unsatisfactory law and order situation is a threat to the fast food chain of industries. Safety of capital and the security for the personnel engaged in the projects are essential ingredients that govern foreign investment. Unfortunately, Pakistan’s law and order situation has remained far from satisfactory in the major growth poles of the country. Karachi, the largest industrial and commercial center and the only commercial port of the country, has been disturbed in varying degrees since 1989. In recent years the law and order situ ation has also deteriorated in the Punjab province.

2)Government policies: Pakistan’s track record in maintaining consistent economic policies has been poor. The abrupt changes in policies with a change in government as well as a change in policy within the tenure of a government have been quite common. Pressures to raise revenues (for fiscal consideration), and other conflicting objectives have generally led to inconsistencies in investment and industrialization policies. Revenue measures are not in harmony with the industrial policies

3) the Pakistan government is very unstable and it is difficult for industries to enter in this country..even the increase of terrorism in the country it is very difficult for people to start a business over there

Economical risk

1) Investors would not want to invest in a country where the economic fundamentals are so weak that it is unpredictable what the government would do next to prop up a sagging economy. In countries of high economic strength, the investor is assured of a growing of high economic strength, economy, and of increased opportunities for business, as more government development projects and private sector investments put purchasing power in the hands of the people.

2) The availability, reliability, and cost of infrastructure facilities (power, telecommunications, and water supplies) are important ingredients for a business environment conducive to foreign investment. Pakistan compares unfavorably in infrastructure facilities with other developing countries.

3) The Pakistan economy faces several long term challenges such as curbing inflation and expanding investment in healthcare, education, and electricity production. Which does not help in getting more business in the country

United Kingdom (England and North Ireland)

POLITICAL1) Health and Safety Guidelines- There are lot of guidelines that a fast food chain has to take consideration to perform its task comfortably. If the rules are not followed then there can be lot of trouble for them.they have to maintain cleanees in there restaurant and provide there customers with good quality of food.

2) Labelling of GM Foods-

The safety of GM food products and ethical issues related to the use of gene technology are constantly debated. Some people would like to know if any food product they are purchasing is from a GM source. New labelling rules for genetically modified foods, or food containing GM ingredients, were introduced in December 2001. The new food labelling standard required the labelling of GM food and food ingredients – additive or processing aid - where new DNA and/or new protein is present in the final food or where the food has altered characteristics.the company should mentin there labelling properly as this things are taken seriously by the government. So every think shoul be mentioned properly.

3) Animal rights campaigns-

people over there have been having fighting for the life of animals as lot of domestic animals like chicken, cow and pigs are killed so they can just fill humans stomach. This are important for fast food chins as there work is related to this animals and most of this animals are killed by these industries. So it has to work with the socity which is present in UK . I have no doubt that it is a part of the destiny of the human race, in its gradual improvement, to leave off eating animals, as surely as the savage tribes have left off eating each other when they came in contact with the more

ECONOMIC1) Low set up costs-

The investment for setting up a fast food chain is very less which is good. But it help lot of people to set up there own fast food chain which increases the competitions in the market. Which is very high in UK market and can cause lot of trouble for the big companies who have invested heavely in the fast food chains as they get competition from small chains and also from the other big fast food chains.

2) Patents and Copyrights- In some cases a key productive input or even the output itself involves a patent or copyright. A patent is the exclusive right to use, sell, or market an invention for a specified period. In the United Kingdom, patents give inventors exclusive rights for a given number of years. A copyright is the exclusive right to reproduce, copy, and sell written materials. In the United Kingdom, copyrights also are awarded for a given number of years. Patents and copyrights impose barriers to entry.

While copyrights work in much the same way, they tend to create less of a barrier to entry. A patent on the technology behind Flex-Star Interactive Trophy Plaques is a severe barrier to entry. In contrast, the copyright on a Brace Brickhead, Medical Detective novel is much less restrictive. Another author could write and copyright a similar detective novel about Chance Chesterfield, Super Sleuth. Each is a relatively close substitute for the other.

3) Inflation Rates- Inflation rate is the general rise in prices measured against a standard level of purchasing power. In April 2009, prices dropped 1.5% from last year, after steady falling at the beginning of 2009. Falling prices lower the costs on goods and encourage consumers to spend. This helps the UK economy recover its diminishing exports. Inflation was at 8.5% which caused the price of pork to increase because the shortage on meat. Food fell 1.3% from a year earlier which represents the biggest part of the index. Non-food prices fell 1.5%, garments fell 2.5%, service costs dropped 1.4%, and utilities fell 2.2%. Producer prices decreased on lower raw-material and energy costs.

4) Resource Ownership-

One of the most fundamental barriers to entry is resource ownership, the ownership and control over a critical input used in the production of a good. Limiting ownership of this input effectively limits entry into the corresponding industry.

To enter this industry, the eleventh firm must acquire ownership over resources. This could be accomplished in a couple of ways. (1) It could purchasing existing resources from any of the ten firms currently in the industry. An easy option, but if the original ten are unwilling to sell, then number eleven faces a sizeable enter barrier. (2) It could seek out as of yet undiscovered resources through exploration. The expense of such an endeavor also imposes a significant barrier to entry for firm number eleven.

CHINA

CHINA may boast a 5,000-year-old culinary tradition, but when it comes to fast food, Western-style outlets rule. For this you can thank—or blame—changing consumer tastes, and the breathless expansion plans of chain restaurants, which are eager to grab a bigger slice of the country’s estimated annual 200 billion yuan ($29 billion) fast-food market.

For two decades the battle for the modern Chinese stomach was fought between two American giants: McDonald’s, the world’s largest fast-food chain; and Yum! Brands, which operates the KFC and Pizza Hut brands in China. Yum!, which first arrived in China in 1987 (three years before McDonald’s), has always stayed ahead of its rival—going by both the number of restaurants and consumers’ awareness of the brand. In 2005 the two titans were joined by another American stalwart, Burger King, the world’s second-largest burger chain.

In April Burger King had just 12 outlets on the mainland, including nine in Shanghai. But after this cautious start, the company is pushing ahead with a faster store roll-out: in June it announced plans to open between 250 and 300 outlets in China over the next five years, including another ten restaurants in Shanghai. As in other markets, 90% of them will be franchised and a tenth owned by Burger King. For comparison, KFC has more than 2,200 outlets in some 450 cities and McDonald’s has 950 outlets.

Airport eateries will also be vital. Some 200 of Burger King’s 11,500 outlets worldwide are at airports. Catering there has a number of advantages, including steady, captive customers and limited competition. In February Burger King opened its first outlet at Beijing Capital Airport’s Terminal 3, and the following month it opened two restaurants at Shanghai Pudong International Airport’s Terminal 2. Another ten mainland airports are also on its menu.

One problem for Burger King is that its trademark “Whopper” is made out of beef. Like McDonald’s, the chain must cope with the fact that Chinese consumers prefer chicken. McDonald’s has launched lots of marketing campaigns to try and convince mainland customers about the health benefits of eating beef (apparently, there are some). This has done much to overcome the traditional indifference of Chinese towards beef, probably saving time and money for Burger King’s own marketing campaigns.

Burger King is also adapting its menu for China. It has added chicken dishes and has also added chili to some of its offerings. It has not localised its China menu as much as its rivals have, however. KFC has gone the furthest in tailoring its menu for Chinese tastes, with offerings ranging from pumpkin porridge and Beijing chicken rolls to the Chinese deep-fried twisted dough sticks (youtiao) on its breakfast menu. McDonald’s (and to a lesser extent, KFC) is also ahead of Burger King in making “off-the-menu” innovations. These include “dessert” kiosks selling just sweet pastries and drinks. McDonald’s also runs a 24-hour service at 600 outlets.

With its two American rivals so far ahead, is Burger King likely to be successful in China? There should be demand enough for more than two big American fast-food firms here, analysts reckon, and the company has the resources to finance rapid and sustained expansion into mainland cities. Most important, it is strongly motivated. Burger King is keen to build its business outside America. Four-fifths of the new restaurants to open this year will be outside

its home turf, and the company aims to double its Asia-Pacific presence to some 1,400 outlets over the next five years.

In China, Burger King’s strategy is particularly to chase younger, more individualistic diners in the country’s big cities. Its idea is that these restaurant-goers will want to set themselves apart from older family members or colleagues by trying the newcomer. If so, the Whopper—sold in China as huangbao, or “Emperor Burger”—may yet dethrone the Big Mac here.

Political risk

“China talks capitalism, but breathes socialism… Karl Marx believed that socialism presupposes capitalism; in other words, that society has to undergo capitalist transformation

before the correct conditions for socialism can exist…. An economy containing privately owned businesses is just one of those things, like adolescence, that one has to go through.

How long will this capitalist phase last?”

this is one of the main problms faced by the companies that are having business in china as the government is more socialism and not capitalism.

A unique form of political risk occurs in China, and this is the constant battle between the country’s central government and the provincial and local governments over applicable law, and observance or non-observance of it. This makes it difficult for companies operating in China to know exactly what the rules are. The concept is captured by the Chinese saying: "The mountains are high and the Emperor is far away."

Other point is that his is all happening when the country's top leadership is going into a succession battle; President Hu Jintao and Prime Minister Wen Jiabao are due to step down in 2012. Though this is being fought out far from the public eye, what can be made out is showing unexpectedly deep divisions between various factions within the Party, army and bureaucracy, with a particular rift between economic reformers and those who see economic management as part of national--and Party--security.

Economical risk

Chinese consumers may have more spending power, but they also have less time to cook: a perfect recipe for the growth of fast food in China, where western and Asian chains are battling over the increasing appetite for restaurant meals.

In urban China, high property prices, long commutes, gruelling working hours, a later marriage age and smaller families all add up to more fast food.

The country’s food service industry has recorded double-digit annual growth since 2003 but is still only half the size of the US market, says AlixPartners, a consulting firm in China. The industry, estimated at about Rmb2,000bn ($303bn) in 2009, is forecast to grow to about Rmb3,000bn by 2014, according to industry estimates.

Multinational fast food chains, such as KFC and McDonald’s, arrived early and have come to dominate the market for western quick service meals.

Yum Brands, the US group that owns the KFC chain, opens more than one new restaurant in China every day. And it predicts it earned more operating profit in 2010 in China than in the US, for the first time.

Yum expects soon to have a 3:1 market share lead over its nearest fast food rival, but McDonald’s is investing heavily to catch up. The US burger group took two decades to get to 1,000 restaurants in China, but expects to take only four years to get to 2,000.

McDonald’s even offers home delivery in China. And now that China boasts the world’s largest auto market, it plans to equip half of its new mainland restaurants with drive-through windows.

But the battle for “stomach share” in China is about more than fried chicken and Big Macs. Thanks in part to an influx of venture capital and private equity funds in recent years, Asian fast food chains are increasingly competitive.

“Global brands are running into fierce local chains that are good at branding, and have raised the money to go national,” says Shaun Rein, of China Market Research in Shanghai.

Lim Meng Ann, China head of Actis, a private equity fund that invested $50m in Xiabu Xiabu, a Chinese hotpot chain, at the height of the global financial crisis in 2008, says that “given a choice, Chinese people would always

prefer Chinese food”. He adds that Xiabu’s revenues have grown by “well over 50 per cent” per year.

No one is predicting that the Chinese will forswear burgers and fries anytime soon, not to mention KFC’s more indigenous offerings, including a dish sometimes referred to as rice porridge with pork and 1,000-year old eggs for breakfast – a dish so popular it often sells out before 8am.

But diners recently riding on Shanghai’s “Lunch Bus” – a free shuttle that takes white-collar workers from the city’s financial district to a local fast food emporium – made clear that, given the time and the choice, they prefer Asian.

Yan Bo, 25, a vegetable oil trader at a local bank, says he is “too Chinese” to lunch at McDonald’s.

“Last year I was very busy and I ate McDonald’s five times in one week,” he says ruefully. “But I only do that if I have no time at all. It’s too unhealthy.”

Lunch bus riders named Ajisen, a Japanese noodle chain that offers 98 menu choices, and Banana Leaf, a Thai curry chain, among their favourites. Little Sheep, a Mongolian hotpot chain part owned by Yum Brands, and Country Style Cooking Restaurants, a Sichuan chain that recently raised $82m in a New York IPO, and the ubiquitous Kungfu, are other Asian chain high-fliers.

“I don’t think it is necessarily a battle between western and Chinese quick service restaurants,” says Mr Lim of Actis.

Chain restaurants in general have very low market share, says Christian Paul of AlixPartners, but he predicts that will change. “Chinese consumers ... like a brand to give them comfort,” and that is just as true of food as of handbags, he says.

Xia Lianyue, vice-chairman of the China Fast Food Association, says rising urban salaries and long commutes are driving the emergence of an all-new “simple meal” market averaging Rmb50-Rmb100 per meal, a cut above fast food at Rmb30 per person. That will be the battleground for food companies in China: the battle for the stomach of China has just begun.

AUTOMOBILE INDUSTRY

The first practical automobile with a petrol engine was built by Karl Benz in 1885 in Mannheim, Germany. Benz was granted a patent for his automobile on 29 January 1886, and began the first production of automobiles in 1888, after Bertha Benz, his wife, had proved with the first long-distance trip in August 1888 (from Mannheim to Pforzheim and back) that the horseless coach was absolutely suitable for daily use. Since 2008 a Bertha Benz Memorial Route commemorates this event.

Soon after, Gottlieb Daimler and Wilhelm Maybach in Stuttgart in 1889 designed a vehicle from scratch to be an automobile, rather than a horse-drawn carriage fitted with an engine. They also are usually credited as inventors of the first motorcycle, the Daimler Reitwagen , in 1885, but Italy's Enrico Bernardi, of the University of Padua, in 1882, patented a 0.024 horsepower (17.9 W) 122 cc (7.4 cu   in ) one-cylinder petrol motor, fitting it into his son's tricycle, making it at least a candidate for the first automobile, and first motorcycle;. Bernardi enlarged the tricycle in 1892 to carry two adults.

About 250 million vehicles are in use in the United States. Around the world, there were about 806 million cars and light trucks on the road in 2007, consuming over 260 billion gallons of gasoline and diesel fuel yearly. The automobile is a primary mode of transportation for many developed economies. The Detroit branch of Boston Consulting Group predicts that, by 2014, one-third of world demand will be in the four BRIC markets (Brazil, Russia, India and China). Other potentially powerful automotive markets are Iran and Indonesia. Emerging auto markets already buy more cars than established markets. According to a J.D. Power study, emerging markets accounted for 51 percent of the global light-vehicle sales in 2010. The study expects this trend to accelerate

World motor vehicle productionYear Production Change

2001 56,304,925

2002 58,994,318 4.80%

2003 60,663,225 2.80%

2004 64,496,220 6.30%

2005 66,482,439 3.10%

2006 69,222,975 4.10%

2007 73,266,061 5.80%

2008 70,520,493 -3.70%

2009 60,986,985-

13.50%

Pakistan

The Automotive industry has been an active and growing field in Pakistan for a long time, however not as much established to figure in the prominent list of the top automotive industries. Despite significant production volumes, transfer of technology and localization of vehicle components remains low. Most cars in the country have dual fuel options and run on CNG which is more affordable and cheaper than petrol in the country.

There are only three major cars manufacturing companies in the Pakistan:

PakSuzuki Indus Motors Honda Atlas

Paksuzuki has a almost complete monopoly in the small car segment as it faces almost no competition other than the single odd Diahatsu Cuore produced by Indus Motors. In the Subcompact Sedan segment Toyota Corolla, Honda Civic, Honda City, and the Nissan Sunny are currently the only cars in production. There are still no locally made SUV, Mid or Full sized sedans available.Toyota Corolla and Suzuki Mehran are currently the highest selling cars in the country

As of 2010, Pakistan has not adopted any automotive emission or safety standards. Therefore, most cars manufactured and sold in the country are still carburetor based and do not meet any international emission standards. Many locally made cars such as Suzuki Mehran, Suzuki Cultus, Suzuki Bolan, Diahatsu Cuore, etc are globally obsolete cars from the 1970s or 1980s which are no longer produced or sold in any country other than Pakistan.

At present most cars assembled in Pakistan also do not have safety features mandatory by law in other countries. For e.g No car currently sold by Paksuzuki, the country's largest assembler, offers any airbags. Paksuzuki currently does not sell any automatic transmission vehicles and only offers manual transmission vehicles.

The local auto industry is also known to overcharge genuine customers by collecting "premium" and selling cars at a much higher price than their official retail amount. The existing auto lobby has also severely objected to the recent proposals to give new assemblers incentives to enter the Pakistani market.

Political risk

Protection level:

Before the TBS was introduced the auto industry was well protected by the government but now as the import of CKD and CBU is liberalized the protection level to industry by government is decreased

Smuggling of auto parts

The auto industry is generally faced by multiplicity of taxes; the presumptive tax regime has led to increase in prices of imported inputs and the finished goods. Component manufacturers are struggling to compete with under-invoicing, miss declaration and smuggling. Import of used parts is still continuing at a large scale. Smuggling, under-invoicing and dumping of auto parts

Decreasing tariff structure:

For localized parts of CKD cars, the tariff would reduce from 50 per cent to 45 per cent in 2008-09 and further to 35 per cent in the next two years. The tariff for CKD non-localized parts would be reduced from 35 per cent to 32.5 per cent in 2007-08 and would keep on decline by 2.5 per cent every year to 25 per cent in 2010-11.

The rate for CBU cars up to 1500cc, the tariff would be reduced from 50 per cent to zero next year (2007-08) and to be kept at that level thereafter. For CBU cars between 1500-1800cc, the current rate of 65 per cent would be reduced at the rate of five per cent annually to 50 per cent by 2010-11. For CBU cars exceeding 1800cc, the applicable rate of 75 per cent would be reduced at the rate of five per cent per annum to 50 per cent in 2010-11.

For LCVs, the tariff on CKD kits would be reduced from 20 per cent to 15 per cent at the rate of one per cent every year. However, the tariff for CBU LCVs, the rate would be reduced from 60 per cent to 50 per cent in a phased manner by 2010-11.

For two-wheelers, the tariff on CKD kits would be reduced from existing 30 per cent to 20 per cent in phased manner to 2010-1. Similarly, the tariff on CBU two wheelers would reduce to 60 per cent by 2010-11 from existing rate of 90 per cent.

For localised CKD parts of tractors and heavy commercial vehicles, the existing tariff of 35 per cent has been proposed to be reduced to 25 per cent in 2010-11.

For prime movers (up to 280 HP) the tariff for CKD would be reduced from 10 percent to five per cent next year and then kept at that level onwards. Similarly, thetariff for CBUs would be reduced to 25 per cent next year and then kept at that levelfor the next five years. The tariff for prime movers (above 280HP) and would remainunchanged, while it would be reduced for trucks from 10 to five per cent and from30 to 25 per cent next year.

Economical risk

Fuel prices According to the authorities the fuel prices which currently are Rs 78 and has increase by more Rs. 6 by the end of 3-Jun-11and now the price for petrol is Rs 84.

Competition from import cars Auto industry is facing a threat from the import of cars which is already liberalized further it is said that government will cut about 15% of duties till 2011.

Lack of skilled manpower for modern machinery In Pakistan conventional machines are not able to meet the precision manufacturing and the available labor is not familiar with modern technology it caused by lack of coordination and linkages with Government/Semi Government Supporting Bodies and Technical Training Institutes

Scarcity of raw material especially steel Through previous years the world prices are rising and causing costly inputs and Pakistan has left with scarce Steel and Iron left, so manufacturers are facing difficulties in producing cars with low prices.

WTO—Deletion program:

THE World Trade Organization (WTO) has rejected Pakistan’s request for the extension of the deletion program which enabled it to lay down the condition of the local content requirement (LCR). Under LCR, the automobile and other engineering industry was required to use locally manufactured parts and accessories in terms of government’s deletion policy. The condition of the LCR was an aberration to the Clause 5.2 of the WTO Agreement on Trade Related Investment Measures (TRIMs), Article III–-National Treatment under the GATT, 1994.

WTO’s decision for not extending its deletion program / LCR condition has varied impact on Pakistan’s vendor industry, automobile assemblers, car users and the government.

Input Cost

In Pakistan as the inflation is increasing so as the input costs and for manufacturers it is becoming harder to produce at lower cost. Increasing cost of energy and its unreliable and inconsistent supply adds up the cost of manufacturing and wastage of resources. It is estimated that by the year 2012, auto industry consumption of electricity will cross 500 – 600 MW from around 250 - 300 MW, as of now.

UK

The automotive industry in the United Kingdom is now best known for premium and sports car marques including Aston Martin, Bentley, Daimler, Jaguar, Lagonda, Land Rover, Lotus, McLaren, MG, Mini, Morgan and Rolls-Royce. Volume car manufacturers with a major presence in the UK include Ford, Honda, Nissan, Toyota and Vauxhall Motors (owned by General Motors).[1] Commercial vehicle manufacturers active in the UK include Alexander Dennis, Ford, GMM Luton (owned by General Motors), Leyland Trucks (owned by Paccar) and London Taxis International.

In 2008 the UK automotive manufacturing sector had a turnover of £52.5 billion, generated £26.6 billion of exports and produced around 1.45 million passenger vehicles and 203,000 commercial vehicles. In that year around 180,000 people were directly employed in automotive manufacturing in the UK, with a further 640,000 people employed in automotive supply, retail and servicing. The UK is a major centre for engine manufacturing and in 2008 around 3.16 million engines were produced in the country. The UK has a significant presence in auto racing and the UK motorsport industry currently employs around 38,500 people, comprises around 4,500 companies and has an annual turnover of around £6 billion.[2]

The origins of the UK automotive industry date back to the final years of the 19th century. By the 1950s the UK was the second-largest manufacturer of cars in the world (after the United States) and the largest exporter. However in subsequent decades the industry experienced considerably lower growth than competitor nations such as France, Germany and Japan and by 2008 the UK was the 12th-largest producer of cars measured by volume. Since the late 1980s many British car marques have become owned by foreign companies including BMW, SAIC, TATA and Volkswagen Group. Rights to many currently dormant brands, including Austin, Riley, Rover and Triumph, are also owned by foreign companies.

Famous and iconic British cars include the Aston Martin DB5, Aston Martin V8 Vantage, Bentley 4½ Litre, Jaguar E-Type, Land Rover Defender, Lotus Esprit, McLaren F1, MGB, original two-door Mini, Range Rover and Rolls-Royce Phantom III. Notable British car designers include John Polwhele Blatchley, Ian Callum, Colin Chapman, Alec Issigonis, Charles Spencer King and Gordon Murray

The British motor industry started when Frederick Simms became friends with Gottlieb Daimler, who had, in 1885, patented a successful design for a high-speed petrol engine. Simms, a London consulting engineer, bought the British rights for Daimler's engine and associated patents and from 1891 successfully sold launches using these Cannstatt-made motors from Eel Pie Island in the Thames. In 1893 he formed The Daimler Motor Syndicate Limited for his various Daimler-related enterprises.

In June 1895 Simms and his friend Evelyn Ellis promoted motorcars in Britain by bringing a Daimler-engined Panhard & Levassor to England and in July it completed, without police intervention, the first British long-distance motorcar journey from Southampton to Malvern.[

Simms' documented plans to manufacture Daimler motors and Daimler Motor Carriages (in Cheltenham) were taken over, together with his company and its Daimler licences, by London company-promoter H J Lawson. Lawson contracted to buy The Daimler Motor Syndicate Limited and all its rights and on 14 January 1896 formed and in February successfully floated in London The Daimler Motor Company Limited. It then purchased from

a friend of Lawson a disused cotton mill in Coventry for car engine and chassis manufacture where, it is claimed, Britain's first serial production car was made.

The claim for the first all-British motor car is contested, but George Lanchester's first cars of 1895 and 1896 did include French and German components. In 1891 Richard Stephens, a mining engineer from South Wales, returned from a commission in Michegan to establish a bicycle works in Clevedon, Somerset. Whilst in America he had seen the developments in motive power and by 1897 he had produced his first car. This was entirely of his own design and manufacture, including the two-cylinder engine, apart from the wheels which he bought from Starley in Coventry. This was probably the first all-British car and Stephens set up a production line, manufacturing in all, twelve vehicles, including four and six-seater cars and hackneys, and nine-seater buses.

Early motor vehicle development in the UK had been effectively stopped by a series of Locomotive Acts introduced during the 19th century which severely restricted the use of mechanically propelled vehicles on the public highways. Following intense advocacy by motor vehicle enthusiasts, including Harry J. Lawson of Daimler, the worst restrictions of these acts, (the need for each vehicle to be accompanied by a crew of three, and a 2 mph (3.2 km/h) speed limit in towns), was lifted by the Locomotives on Highways Act 1896.[13] Under this regulation, light locomotives (those vehicles under 3 tons unladen weight) were exempt from the previous restrictions, and a higher speed limit - 14 mph (23 km/h) was set for them. To celebrate the new freedoms Lawson organised the Emancipation Run held on 14 November 1896, the day the new Act came into force. This occasion has been commemorated since 1927 by the annual London to Brighton Veteran Car Run

POLITICAL

In taxicabs, banking, telecommunications, and broadcasting, entry usually requires the granting of a license by a public authority.

Individuals have benefited from governments granting them an exclusive right to ply a particular trade or offer a particular service.

ECONOMIC

The capital costs of getting established in an industry can be so large as to discourage all but the largest companies.

The problem for new entrants is that they are faced with the choice of either entering on a small scale and accepting high unit costs, or entering on a large scale and running the risk of underutilized capacity while they build up sales volume.

Apart from economies of scale, established firms may have a cost advantage over entrants simply because they entered earlier.

In an industry where products are differentiated, established firms possess the advantages of brand recognition and customer loyalty.

Whereas lack of brand awareness among consumers acts as a barrier to entry to new suppliers of consumer goods, a more immediate barrier for the new company is likely to be gaining distribution

China

China’s automobile industry sees a promising future after years of development. In 1998, China produced 1.56 million automobiles, accounting for only one sixth of General Motor’s annual output and one third of Toyota’s yearly production. After less than one decade of development, China has emerged into the world’s fastest-growing major auto market, with an average annual growth of more than 22.2% from 1998 to 2006.           In 2006, it overtook Japan as the world’s second largest auto consumer after the U.S., with auto sales rising 25.1% year-on-year to 7.2 million units. Meanwhile, it surpassed Germany to become the third largest auto maker after the U.S. and Japan, with automobile production climbing 27.6% year-on-year to 7.3 million units.           In 2007, automobile production and sales jumped over 20%, despite soaring raw material prices, indicating continued robust growth in the world’s second largest auto market.           Automobile production amounted to 8.88 million in 2007, with an increase of 22.02% over 2006. This figure closely approaches the target of 9 million units set in the eleventh 5-year (2006-2010) plan for the automobile industry by China’s National Development & Reform Commission, the nation’s top economic planner. Auto sales totaled 8.79 million, representing a growth of 21.84% year-on-year.

China’s automobile industry is currently dominated by passenger cars. The share of passenger cars in the country’s total number of automobiles rose from 18.4% in 1994 to 53.6% in 2006 by output, while the average annual growth rate of passenger car output was 6.9 times that of commercial vehicles from 2001 to 2006.

Political risk

General market risks. The global economic and financial crisis led to substantial falls in demand for automobiles and commercial vehicles in 2009. State scrappage incentives alleviated the slump in demand for cars somewhat, but Daimler profited from these actions only to a very limited extent. There is a danger, however, that the discontinuation of this fiscal support will lead to significant falls in unit sales in the coming years. Customers have meanwhile become used to a certain level of sales supporting actions. Such additional financing offers and price incentives could have a negative impact on earnings in the coming years. Competitive pressure in the automotive markets, which was already a significant factor, has therefore intensified. In many markets, customers’ heightened sensitivity to the issue of vehicles’ environmental friendliness and high fuel prices have boosted demand for smaller, more fuel-efficient automobiles. In order to enhance the attractiveness of less fuel-efficient vehicles, additional measures could become necessary with an adverse effect on profitability. These additional actions would not only reduce revenues in the new-vehicle business, but would also lead to lower price levels on used-vehicle markets and thus to falling residual values for leased vehicles.

Risks related to the legal and political framework. The legal and political framework has a considerable impact on Daimler’s future business success. Regulations concerning vehicles’ exhaust emissions, fuel consumption and safety play a particularly important role. Complying with these varied and often diverging regulations all over the world requires strenuous efforts on the part of the automotive industry. We expect to have to significantly increase our spending aimed at fulfilling these requirements in the future. Many countries have already implemented stricter regulations to reduce vehicles’ emissions and fuel consumption, or are about to do so, one example being European regulations on exhaust emissions and fuel consumption. The key elements of the European Union’s regulation on carbon dioxide, which was passed by the EU parliament at the end of 2008, call for a significant reduction in new vehicles’ CO2 emissions already as of 2012, and for phased improvements whereby the average emissions of manufacturers’ entire fleets of new cars have to meet new limits by 2015. Non- compliance with those limits will lead to penalty payments for manufacturers. Similar legislative proposals is also available in China

Economical risk

China is slowing, but it's a slowdown coming off a high base and it's a slowdown that is needed in the interests of economic stability. Russia is strongly up this year. India is up, too. Europe may be 'two speed' but Germany's economy has been very strong. The underlying situation in North America can perhaps be described as one of continuing gradual improvement. The supply-chain disruption caused by the March 11 earthquake and tsunami in Japan is slowly but surely being overcome.

There are some pretty big concerns in the background though. One is the situation in the US with the possible US government debt default. Another is the fragile state of the European economy and the pressures at work that threaten financial stability in the eurozone. There is a need for the relevant authorities and key actors to steer a course through these potentially dangerous waters to ensure the global economy doesn't receive a sizeable negative shock. A broader financial crisis is not out of the question. We also need the price of oil to stay stable.

After looking unexpectedly strong in the spring, the economic recovery has had a fragile feel about it lately. The latest US economic data hasn't lived up to the upbeat promise suggested earlier in the year. Interest rates are still on the floor here in Britain, despite an uptick in inflation, such are the concerns over the strength of underlying demand in the economy. Household incomes are falling in real terms and house prices are going down again. With the base rate at 0.5%, if the economic situation deteriorates there isn't room for big interest rate cuts as there was a few years ago. And government finances are not exactly in good shape, so support from government spending isn't really an option either.

The overall situation isn't too bad given where things were a few years ago, but keeping the global economic recovery on track and avoiding financial instability is perhaps more important than ever right now.

TOBACCO INDUSTRY

The tobacco industry comprises those persons and companies engaged in the growth, preparation for sale, shipment, advertisement, and distribution of tobacco and tobacco-related products. It is a global industry; tobacco can grow in any warm, moist environment, which means it can be farmed on all continents except Antarctica. The tobacco industry is particularly significant for those seeking to understand modern public relations techniques and the operations of specific companies for two reasons. Firstly, as a global industry that came under sustained criticism from the mid-twentieth century onwards, it pioneered many big-budget campaigns that fueled the growth and evolution of the public relations industry. Secondly, as a result of legal actions against the major tobacco companies, there are now over 40 million pages of internal company documents publicly available on searchable websites that provide a fascinating insight into the inner workings of past and still running campaigns.

Tobacco, one of the most widely used addictive substances in the world, is a plant native to the Americas and historically one of the half-dozen most important crops grown by American farmers. More specifically, tobacco refers to any of various plants of the genus Nicotiana, (especially N. tabacum) native to tropical America and widely cultivated for their leaves, which are dried and processed chiefly for smoking in pipes, cigarettes, and cigars; it is also cut to form chewing tobacco or ground to make snuff or dipping tobacco, as well as other less common preparations. From 1617 to 1793 tobacco was the most valuable staple export from the English American mainland colonies and the United States. Until the 1960s, the United States not only grew but also manufactured and exported more tobacco than any other country.

Since 1964 conclusive epidemiological evidence of the deadly effects of tobacco consumption has led to a sharp decline in official support for producers and manufacturers of tobacco, although it contributes to the agricultural, fiscal, manufacturing, and exporting sectors of the economy. Tobacco is an agricultural commodity product, similar in economic terms to agricultural foodstuffs: the price is in part determined by crop yields, which vary depending on local weather conditions. The price also varies by specific species grown, the total quantity on the market ready for sale, the area where it was grown, the health of the plants, and other characteristics individual to product quality. Laws around the world now often have some restrictions on smoking, but 5.5 trillion cigarettes are still smoked each year. Tobacco is often heavily taxed to gain revenues for governments and as an incentive for people not to smoke.

Pakistan

tobacco industry — growing, manufacturing, distribution and retailing — contributed 4.4 per cent or over Rs 27.5 billion to the total GDP of Pakistan including Rs 15.17 billion, including Rs 14.54 billion in excise duty and sales tax, in 1997. It is the single biggest contributor of excise duty, six-times than that from cotton yarn. Over 5 per cent of all taxes collected in the country comes from the tobacco industry. It employs over one million people directly or indirectly which in terms of full-time equivalent jobs means 312,500 jobs supporting some 1.2 million persons.

The area under tobacco cultivation increased by 30 per cent during 1990-91 to 1998-99 — from 44,000 hectares to 57,000 hectares. The production has increased even more significantly during the same period — by 145 per cent from 75,000 tonnes to 109,000 tonnes. The value-added sector, the cigarette production, depicted a far more unproportionate increase of 72 per cent — from 29.8 billion sticks to 51.5 billion sticks during the same period.

Tobacco is the only crop grown in Pakistan whose yield is well above the world average and matches the per hectare yield in the US and other developed countries — an average yield of 1,900 kilograms per hectare. Tobacco industry — growing, manufacturing, distribution and retailing employs over one million persons directly or otherwise. This translates in the full time equivalent of 312,500 jobs supporting approximately 1.2 million persons. Manufacturing employs the highest number of persons — 35 per cent followed by 33 per cent by growing and 32 per cent in distribution and retail.

Political risk

Political Instability Lack of Favourable policies, effective regulations and reasonable provisions relating

to the Industry

Economical risk

Smuggling

It is easy to understand the threat of huge revenue loss that presence and easy availability of smuggled cigarettes pose to the economy of Pakistan. The government is losing a substantial revenue of Rs 3 billion from the smuggling of cigarettes into the country. According to Aslam Khaliq, the director consumer and regulatory affairs of Pakistan Tobacco Company, the second top cigarette manufacturer after Lakson Tobacco, the government is losing at least Rs billion every year due to cigarette smuggling. He blamed the high taxation as the singular most important incentive for cigarette smuggling.

This is true if one looks at the global trends of taxation on cigarettes. Smokers in Pakistan pay the highest tax in the world second only to Denmark and the UK where 85 per cent and 82 per cent of the retail price respectively goes toward taxation. In Pakistan, 78 per cent of the retail price of premium brands ( all brands whose retail

price is over Rs 10 per 20 sticks) and 58 per cent of the retail price of low segment brands go toward taxation.

Price war

Defending the price war started by PTC by slashing the prices of a number of its middle-priced brands early this year, Aslam said that it brought numerous domestic manufacturers in the excise duty and sales tax net. For instance, slashing the prices on some of its brand by 50 per cent from Rs 19 to Rs 9 reduced the excise duty from 63 per cent to 43 per cent with sales tax remaining unchanged at 15 per cent. Despite price reduction, Aslam said, PTC was able to break even due to increased turnover and at the same time forced manufacturers who did not pay excise duty and sales tax in the net to create a level playing field.

Though worried about smuggling and high taxation, Aslam expressed that cigarette prices in Pakistan are on the much low side. He said that the manufacturers should be allowed to increase the prices of their products to better their revenues which are constantly threatened by massive smuggling. He also suggested that price increases would help discourage smoking in the country.

True. Experience in many countries show that each 10 per cent increase in cigarette prices results in a 5 per cent decrease in the numbers of smoking adults and much more in young adults — between 6 to 8 per cent — who have little surplus funds to spend on smoke. However, the argument that high prices discourage smoking is a bit flawed particularly in the context of Pakistan.

Number one, unlike all developed and many developing countries Pakistan choose not to spend even a negligible portion of tobacco taxes on healthcare, research, education, and anti-smoking activities. Such developing countries, not to mention the developed ones, as Nepal and Peru spend a share of cigarette taxes to support cancer research and treatment. Latvia allocates 30 per cent of the revenue which it earns from the tobacco tax on healthcare. Iran earmarks a portion of tobacco tax revenue on healthcare and education.

if the manufacturers and policy makers are really serious about reducing smoking in Pakistan through price increases — and no one say that they are — they need to raise taxes on all brands of cigarettes be it locally manufactured — imported. Supporting the domestic tobacco industry against imports, as is the case with Pakistan, may be good for the local industry but negates the very argument that higher prices and taxation discourages smoking.

UK

Over the last year there have been significant changes among the largesttobacco companies with Imperial Tobacco acquiring Altadis, formerly thefifth largest company in the industry, and Altria (Philip Morris) retaining itsoperations in the USA and spinning off its international tobacco operations(Philip Morris International).

Excluding China, which accounts for a third of total global cigaretteconsumption, the five largest tobacco companies are Philip MorrisInternational (24%), British American Tobacco (19%), Japan TobaccoInternational (17%), Imperial Tobacco (9%) and Altria (5%). Together theyaccount for 74 per cent of the total cigarette market. The cigarette and tobacco market in the United Kingdom is dominated by two firms, Gallaher and Imperial Tobacco, who between them control around 85% of the market. British American Tobacco (BAT) manufactures cigarettes in the UK but sells most of them abroad. In recent years, the proportion of smokers using hand-rolled tobacco(HRT) has increased so that now approximately one in four cigarettes smoked in the UK is hand-rolled. However, over half of all hand rolled tobacco smoked in the UK is smuggled. The legitimate, tax-paid market is dominatedby five brands which comprise over 90% of legal sales.

In the UK, the tobacco industry has been steadily reducing its workforce, largely as a result of mechanisation and rationalisation.One study found that of the 19,400 jobs lost between 1963 and 1985, 16,000 (82%) could be attributed to general factors such as productivity improvement According to the latest official estimates, in 2007 around 5,000 people were employed in tobacco manufacturing.

POLITICAL

Laws around the world now often have some restrictions on smoking, but 5.5 trillion cigarettes are still smoked each year.

Tobacco is often heavily taxed to gain revenues for governments and as an incentive for people not to smoke.

Tough law enforcement measures are the way to tackle tobacco smuggling. The tobacco industry is being disingenuous in claiming that tax increases will

result in massive leaps in smuggling. Since the government started cracking down on smuggling and new laws were

put in place with the threat of heavy fines for manufacturers which allow their products to be smuggled, smuggling has reduced dramatically.

ECONOMIC

The tax on a packet of 20 cigarettes rose 34p last year and the budget is scheduled to bring the increase for 2011 to 39p a pack.

Tobacco sales are a major contributor to Treasury coffers, with about 77% of the pack price going directly to the chancellor.

China

People in china are addicted to tobacco and lot of people overe there are chain smoker.

Political risk

Government

The Chinese government consists of a system of multi-party cooperation and political consultation under the leadership of the CPC. The system ensures that the CPC is the only party in power in the People's Republic of China. Under the precondition of accepting the leadership of the CPC, the eight other political parties participate in the discussion and management of state affairs, in cooperation with the CPC.

Human Rights

The China country reports in the State Department's 2007 Human Rights Practices and International Religious Freedom Reports noted China's well-documented and continuing abuses of human rights in violation of internationally recognized norms, stemming both from the authorities' intolerance of dissent and the inadequacy of legal safeguards for basic freedoms.

Political Stability

The level of foreign business activity in China after the Tiananmen Square massacre has fallen off dramatically in many areas, including tourism and foreign investment. While companies not already involved in China are wary of committing investment to China, countries already involved in investment activities seemingly are waiting for a quiet period in which economic progress will begin again and believe that China will not expel foreign investors in the meantime. There is not much likelihood that extant joint ventures and foreign manufacturing plants will be closed under the present regime, but political stability is still a big question to foreign investors.

Economical risk

TRADE AND CURRENCY DISPUTES

Signs of a thaw in relations between Washington and Beijing have convinced foreign exchange markets China will soon unshackle the yuan from its dollar peg and allow it to appreciate against other global currencies, two years after it was fixed at a rate many economists regarded as undervalued, and which many Western policymakers said gave Chinese firms an unfair advantage which worsened global imbalances.

U.S. Treasury Secretary Timothy Geithner delayed a report due in April that could have branded China a "currency manipulator", avoiding an embarrassing spat during President Hu Jintao's visit to Washington for a nuclear security summit. The two global powers also narrowed their differences over how to contain Iran's nuclear ambitions. But while the consensus opinion in financial markets and diplomatic circles overwhelmingly expects a change in Chinese currency policy this year, the key questions of when and by how much the yuan is allowed to rise remain unknown.

There is also a risk another diplomatic row could complicate currency policy -- members of the U.S. Congress have demanded tougher steps to press Beijing, including the threat of extra tariffs on Chinese goods, and rising disquiet about Chinese trade policy in the United States could be exacerbated by broader tensions over Tibet and Taiwan and by U.S. Congressional elections in November. Meanwhile, the willingness of China's government to consider any policy change tends to be inversely proportional to how strongly such change is demanded by the West.

SOCIAL STABILITY

China's Communist Party has so far maintained general authority and control despite fears in 2008 and 2009 the global economic crisis could spark unrest among laid-off workers. Outbreaks of discontent have remained brief and localised.

But with the Party and global markets treating social stability as a crucial issue, even limited challenges to the Party's control can produce outsize policy reactions.

Ethnic tensions in Tibet and Xinjiang have distracted the central government and drawn international concern, but have not seriously threatened national stability.

MEDIA INDUSTRY

James Augustus Hickey is considered as the "father of Indian press" as he started the first Indian newspaper from Calcutta, the Calcutta General Advertise or the Bengal Gazette in January, 1780. In 1789, the first newspaper from Bombay, the Bombay Herald appeared, followed by the Bombay Courier next year (this newspaper was later amalgamated with the Times of India in 1861).

The first newspaper in an Indian language was the Samachar Darpan in Bengali. The first issue of this daily was published from the Serampore Mission Press on May 23, 1818. In the same year, Ganga Kishore Bhattacharya started publishing another newspaper in Bengali, the Bengal Gazetti. On July 1, 1822 the first Gujarati newspaper the Bombay Samachar was published from Bombay, which is still existant. The first Hindi newspaper, the Oodunt Marthand began in 1826. Since then, the prominent Indian languages in which papers have grown over the years are Hindi, Marathi, Malayalam, Kannada, Tamil, Telugu, Oriya, Assamese, Urdu and Bengali.[1]

The Indian language papers have taken over the English press as per the latest NRS survey of newspapers. The reason being the growing literacy rate. Increase in the literacy rate has direct positive effect on the rise of circulation of the regional papers. The people are first educated in their mother tongue as per their state in which they live for e.g. students in Maharashtra are compulsory taught Marathi language and hence they are educated in their state language and the first thing a literate person does is read papers and gain knowledge and hence higher the literacy rate in a state the sales of the dominating regional paper in that state rises.

The next reason being localisation of news. Indian regional papers have several editions for a particular State for complete localisation of news for the reader to connect with the paper. Malayala Manorama has about 10 editions in Kerala itself and five outside Kerala and two abroad (Bahrain and Dubai). Thus regional papers aim at providing localised news for their readers. Even Advertisers saw the huge potential of the regional paper market, partly due to their own research and more due to the efforts of the regional papers to make the advertisers aware of the huge market.

Pakistan

Media in Pakistan provides information on television, radio, cinema, newspapers, and magazines in Pakistan. Though Pakistani media enjoy relative freedom compared to some of its South Asian neighbours, the industry is subjected to many undemocratic and regressive laws and regulations.

The country was subjected to alternating military and democratic rule – but has managed to thrive on basic democratic norms. Though the Pakistani media had to work under military dictatorships and repressive regimes, which instituted many restrictive laws and regulations for media in order to ‘control’ it, the media was not largely affected. The laws are, however, detrimental to democracy reform, and represent a potential threat to the future of Pakistani media and democracy.

Political risk

Companies with cross border interests in unstable or emerging markets face a volatile risk environment that requires careful planning and management. Aon works in partnership with some of the world’s leading financial institutions, global corporations, traders and exporters, to help them mitigate and manage their risk exposures utilizing a full service political risk management practice

Our team of experts provides comprehensive but flexible solutions, designed for the complex requirements of their global operations. Our services include in-depth program assessment, crisis management consulting, political risk analysis and individually-structured for proper media industryPolitical violence and Government Weakness Attacks on politicians, and alliances formed

between Islamist parties to challenge the government. Changes in political balance of power.

Markets will be watching manoeuvring by opposition parties and the military to gauge the

possibility of a challenge to the government. Most analysts expect the government to remain

in power for now, but distracted from reforms because of its focus on survival

Media laws

There are a number of legislative and regulatory mechanisms that directly and indirectly affect media. Besides the Press and Publication Ordinance (PPO) mentioned above, these laws include the Printing Presses and Publications Ordinance 1988, the Freedom of Information Ordinance of 2002, the Pakistan Electronic Media Regulatory Authority (PEMRA) of 2002, the Defamation Ordinance of 2002, the Contempt of Court Ordinance of 2003, the Press Newspapers News Agencies and Books Registration Ordinance 2003, the Press Council Ordinance 2002, the Intellectual Property Organization of Pakistan Ordinance 2005 and lastly the Access to Information Ordinance of 2006. Also there were

attempts in 2006 for further legislation ostensibly to streamline registration of newspapers, periodicals, news and advertising agencies and authentication of circulation figures of newspapers and periodicals.

Economic risk

There are lot of illiterate and poor people in Pakistan

Bribery and Corruption

Bribery is illegal. It is an offence for British nationals or someone who is ordinarily resident in the UK, a body incorporated in the UK or a Scottish partnership, to bribe anywhere in the world.

In addition, a commercial organisation carrying on a business in the UK can be liable for the conduct of a person who is neither a UK national or resident in the UK or a body incorporated or formed in the UK. In this case it does not matter whether the acts or omissions which form part of the offence take place in the UK or elsewhere.

In 2010, Pakistan was ranked the 36th most corrupt country (out of 178) in Transparency International’s corruption perception index (CPI)Corruption in Pakistan is widespread and deeply entrenched into the system. Corruption takes many forms in Pakistan ranging from petty bribery, nepotism and misuse of power. The main reasons for this high rate of corruption are poverty and low incomes especially of government employees and lack of accountability.

According to surveys regarding corruption in Pakistan respondents, the police are considered as the most corrupt department. Police officers, who are poorly paid, often demand small bribes for alleged infringements, usually from motorists; this has an impact on the daily lives and disposable income of employees, as well as on public trust in the police.

UK

Media of the United Kingdom consist of several different types of communications media: television, radio, newspapers, magazines, and Internet-based Web sites. The UK also has a strong music industry. The UK has a diverse range of providers, the most prominent being principle public service broadcaster, the British Broadcasting Corporation (BBC). The BBC's competitors include ITV plc, which operates 11 of the 15 regional television broadcasters that make up the ITV Network. News Corporation, who operate a number of leader national newspapers through News International such as The Sun and The Times as well as holding a large stake in satellite broadcaster British Sky Broadcasting and various other media holdings. Regional media is covered by local radio, television and print newspapers. Trinity Mirror operate 240 local and regional newspapers in the UK, as well as national newspapers such as the Daily Mirror and the Sunday Mirror.

Political risk