Few people took Chery Automobile seriously when it was established, a little more than a decade ago, in the city of Wuhu, in Anhui Province, China. Chery was a newcomer in a small area that had little tradition of manufacturing and was far from the country’s traditional centers of auto production, in Beijing, Changchun, Shanghai, and Wuhan. When the start-up failed to find buyers for a motor engine it had developed, there was little choice but to manufacture a car of its own so that the engine could find a home. After this first car had been built, bureaucratic obstacles prevented the company from selling it. As chairman and chief executive officer Yin Tongyao puts it, “Chery kept hitting the wall over the past decade. Every time we hit a wall, we just reoriented and moved on.”

A blizzard of advertisements for Indonesia's 11 mobile operators has covered the country, competing for the lowest prices, best call quality and cheapest deals.

So begins what is expected to be a major boom in mobile subscriptions and telecom revenue.

The national regulator slashed internet work connection charges by up to 40 per cent last month and these savings have largely been passed on to users.

The authorities are pushing operators to share towers, which will reduce costs and enable greater network expansion.

The first Chinese mutual fund to invest in "socially responsible" companies in the country is expected to launch by the end of the month.

Industrial Fund Management last week received government approval for the fund, but was forced to scale back its expected size and delayed its launch to the end of the month because investors were wary of committing their money into an equity fund while stock prices are falling, the Shanghai-based company said.

The fund will invest between 65 to 95 per cent of its money in equity, and up to 30 per cent in bonds. After a spectacular bull run, China's domestic A-share market peaked last October. Since then, the Shanghai composite index has fallen more than 30 per cent.

"There has been a lot of interest [in the fund] and a lot of our clients are calling us to ask about it, but they are just too concerned about the market's recent fall," the company said. It said the fund's target size would be at least Rmb100m (£6.9m, $14m, €9m).

Industrial Fund Management said it decided to set up the fund last year after noticing that many Chinese companies were, for the first time, issuing corporate social responsibility reports in addition to their
annual financial results.

It said the fund would not be restricted to a specific area of social responsibility as it was the first such fund in China.

By Martha Legace

Entrepreneurship in the world's 2 most populous nations, China and India, has through modern times been somewhat asleep. But now, says HBS professor Tarun Khanna in a new book, both societies "have woken up," and the results could reshape business, politics, and society worldwide.

"In some sense people in these societies are running faster than their rules and laws can keep up. So they are creating the rules as they go along. And entrepreneurship is, after all, doing things in new ways, ahead of social norms and customs, and establishing the rules and laws. In both countries, these processes are unfolding not just in the mainstream business sector but in society writ large and even in politics and civil society," says Khanna.

Khanna's book Billions of Entrepreneurs: How China and India Are Reshaping Their Futures and Yours will be published by Harvard Business School Press on February 1. Each chapter compares China and India on a broad range of factors in entrepreneurship, including access to capital, freedom and reliability of information, governmental involvement, and infrastructure. Khanna examines the landscape of big, medium, and small entrepreneurship, including rural health-care initiatives and even Bollywood.

As Khanna explained to HBS Working Knowledge, "One can see China clearly when juxtaposed against India, a neighbor that, like China, is a large, populous, and ancient country that chose a different path. The difference is stark. The same is true when we look at India with China as a backdrop. That's why I wrote a comparative book."

In our interview Khanna outlines the business landscape in both countries. He also describes how indigenous and foreign entrepreneurs could get a foothold, how China and India relate to their own diasporas, and how entrepreneurial activity is reshaping both countries for the better.

Banks in the region are turning to smart cards and biometrics to boost their microfinance operations, according to a new report from IDC's Financial Insights.

The study revealed that the successes of banks such as Grameen Bank in providing sustainable microfinancing schemes, have spurred others in the region to grow their microfinance operations. The report cited Indonesia's PT Bank Danamon and India's ICICI Bank, as two examples that rely on biometric and smart card technologies to alleviate the high costs of administering microfinance and to expand such operations.
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"Banks in Indonesia and India have emerged as leaders in deploying innovative technologies to grow their microfinance businesses," said Abhishek Kumar, senior research analyst of Financial Insights' Asia-Pacific banking advisory service. "These banks have shown that technologies like biometrics and smart cards, can be successfully deployed to target previously under-served customer segments, providing business benefits alongside poverty reduction."

Ten trillion dollars will be spent inside emerging markets in infrastructure development between now and 2030 in energy and water alone. Most will happen inside China and India at a pace not witnessed on this planet since America surged westward following the Civil War.

The doom-and-gloomers counter: "But their environments can't withstand all that development! They'll run out of water! All those cars will demand too much oil! All that coal-fired pollution will blot out the sun! And what about all the CO2 they'll emit?

These well-intentioned voices would be right, if these emerging economies showed absolutely no imagination in their developmental trajectories. Still, I'm betting the Asians, along with South Americans and ambitious players elsewhere, will be smarter than that.

Like Hindu souls, disposable plastic cups are many times reborn in Dharavi. In a spiralling continuum, they are discarded and gathered in, melted down to their polypropylene essence, and re-moulded in some new plastic form. Recycling is one of the slum's biggest industries. Thousands of tonnes of scrap plastic, metals, paper, cotton, soap and glass revolve through Dharavi each day.

Location is the key to this. Until two decades ago, the slum was next door to Bombay's biggest rubbish tip. This provided a livelihood for thousands of local dalits, for whom “ragpicking”—scavenging on society's leftovers for anything of salvageable value—is a traditional employment. The tip has since been shifted outside the city. So too, for want of space, have many of Dharavi's recycling units. Yet the roughly 6,000 tonnes of rubbish produced each day by a swelling Mumbai continues to sustain an estimated 30,000 ragpickers, including many residents of Dharavi. The slum is also host to some 400 recycling units.

Around 6am, the squealing of copulating rats—signalling a night-long verminous orgy on the rooftops of Dharavi, a slum in Mumbai—gives way to the more cheerful sound of chirruping sparrows. Through a small window in Shashikant (“Shashi”) Kawale's rickety shack, daylight seeps. It reveals a curly black head outside. Further inspection shows that this is attached to a man's sleeping body, on a slim metal ledge, 12 feet above the ground.With maybe a million residents, crammed into a square mile of low-rise wood, concrete and rusted iron, Dharavi is a squeeze. And in Shashi's family hutment—as slum-dwellings are known in Mumbai, where half the city's 14m people live in one—it feels like it. As the sparrows stir, so do the neighbours. Through the plank-thin walls of the tiny loft where Shashi, a jobbing cleric-cum-social-worker, lives above his parents, come the sounds of people bumping and bickering.On one side is a family of 12 living in a 90-square-foot room—about half the size of an American car-parking space. On the other, eight people share a similar area. Night-sounds suggest they include a man with a painful cough, a colicky baby and an amorous couple. At least they can squeeze inside, unlike the man roosting behind Shashi's hutment—and unlike Parapa Kawale, a 22-year-old friend and neighbour, who had dropped by the previous evening to share a spicy bean curry.

China and India are poorer than we thought; rich countries produce even more than we realised. Those are the obvious conclusions from an unprecedented exercise, carried out by a World Bank-led coalition.

The “International Comparison Program” attempts to compare the size of the world’s disparate economies on the basis of purchasing power. On this basis, China’s output is just 9 per cent of global gross domestic product, down by more than a third from the previous estimate of 14 per cent. India’s share of global GDP is down from 6 per cent to 4 per cent. The total output share of developing economies is down by a sixth. These are huge revisions to the figures.

The obvious questions are: how could the old figures be so wrong? And can we trust the new figures? The simple answer is that calculating purchasing power is hard even in principle.

The initial public offering in April that earned $467 million for the owners of a Mexican lender to the poor, Banco Compartamos (BMOSF), provoked a passionate protest from nonprofit traditionalists around the world. Veteran development experts have argued for years that commercialized microlending inevitably means favoring investors ahead of vulnerable borrowers. "They're money lenders. They're not microcredit," says Muhammad Yunus, who won the Nobel Peace Prize in 2006 for his pioneering work in extending credit to the working poor in Bangladesh.

The debate over capitalism's incursion into microlending, while certain to continue, has the ring of an ideological squabble.

"WE STARTED out abroad as ‘accidental tourists’,” says Anand Mahindra, managing director of Mahindra & Mahindra, an Indian maker of tractors and off-road vehicles. Owed money by a Greek manufacturing plant, it took an equity stake instead, and so Mahindra Hellenic was born in 1984.

Mahindra & Mahindra is now one of 100 companies from the developing world that Boston Consulting Group (BCG) thinks have the clout and ambition to upset the world's multinationals. The consultants sifted over 3,000 companies from 30 countries, picking firms that had revenues approaching or surpassing $1 billion last year and are expanding overseas aggressively (not accidentally). They measure this expansionism by five criteria, including the firms' international sales and assets, and the money they can tap for foreign raids and acquisitions.

The result is a list that cunningly appeals to the pride of the aspirants and the insecurity of rich-world incumbents. According to Fortune magazine, Jeff Immelt sent last year's list to his underlings at General Electric, ordering them to identify the companies it could sell to and buy from, and those it would have to compete with.

Giving a man fish will feed him today, yet teaching him how to fish will provide food for a lifetime. The old Chinese axiom characterizes the philosophy of the Microentrepreneurship Award in China sponsored by Citigroup Foundation and hosted by the China Banking Association.

Rural credit unions

The Microentrepreneurship Award promotes microfinance in China's rural areas by training professionals in rural credit unions and teaching financing fundamentals to business people at the grassroots level in villages. It is part of an effort to help poor people who have dreams to start small businesses to climb out of poverty. It also offers rewards to outstanding rural credit union staff members and business individuals to encourage the spread of financial knowledge in China's rural areas, raising the awareness of microfinance, as well as providing the real opportunities to small businesses.

Rural credit unions in cooperation with the Citigroup Foundation have now disbursed small loans to more than 300,000 clients throughout the country.

Last week, a group of political consultants from all over the world gathered in Bali to discuss, promote and celebrate democracy. The 3-day annual conference was opened by the President, with substantive speeches reaffirming Indonesia's commitment to the democratic way of life.

The views of the leaders from the world's single-largest Moslem population had significant impact on the attending delegates.

Commissioned by the Asia-Pacific chapter of the International Association of Political Consultants, Roy Morgan Research conducted a survey among urban respondents from six countries in the region.

The countries were chosen to represent rich and poor, big and small, East and West, as well as the four major religions practiced this side of the world.

From a business perspective, a particular revelation from the survey demands attention. While the media has been recognized as a force of influence and pillar of society, it has not drawn enough attention to the fact that business has become a major column of our societies today.

A worldwide survey jointly conducted by the GSM Association and Microsoft indicates that there is an untapped potential market of 70 million consumers interested in notebook PCs with built-in mobile broadband, the two companies announced yesterday in Macao.

"Notebook manufacturers weren't yet addressing this opportunity," Robert Conway, the CEO of the GSMA, said at a press conference at the GSMA Mobile Asia Congress. "We've identified a new market segment, and now we're going to define that market segment".

The survey, which was the first of its kind, involved more than 12,000 consumer interviews across 13 countries. It indicated that there is a potential worldwide demand for about 70 million laptop PCs equipped with such technology, and that this segment of the PC/telecom industry could be worth as much as $50 billion.

By JEREMY WAGSTAFF

Individuals' Projects Range From Electricity To Clean Irrigation

(Excerpt)

Innovation isn't always as glamorous as it sounds. Just ask Dean Cameron, who has spent the past few years digging around sludge to find a new way of treating waste, or Donald E. Morgan, whose research into helmets has taken him to the scene of gruesome accidents, or Iqbal Quadir, who found in cow dung a way to boost the fortunes of Bangladesh villages.

They are among the 12 finalists for this year's Asian Innovation Awards, presented by The Wall Street Journal Asia in association with Global Entrepolis@Singapore. The awards honor people and companies who improve quality of life, the environment or business productivity.