CMA Bhawan, 84, Harish Mukherjee Road, Kolkata- 700 025

Phones : (033) 2455- 3418/5957, 6533-1075/6456-3600/01/02/03, 6450 43056666/9999/

Fax No. : (033) 2455-7920 E-mail : eirc@icmai.in Website : www.eircoficmai.com

(Statutory body under an Act of Parliament)

EIRC NEWSThe Institute of Cost Accountants of India

` Annual200/-Vol. 9 No. 04 May, 2016

ISSN 2320 –1584 EIRC News

Tree Plantation on 26 May 2016. CCMs, RCMS, Members & Employees ofEIRC planting Tree at EIRC Premises.

th Members Meet at EIRC on 17 April 2016/ (L/R) CMA Bibekananda Mukhopadhyay,Vice Chairman, EIRC, CMA Asish Banerjee, Treasurer, EIRC, CMA Pranab Kr Chakraborty,Secretary, EIRC, CMA Shiba Prasad Padhi, Chairman, EIRC, CMA Niranjan Mishra, CCM,

ICAI, CMA Biswarup Basu, CCM, ICAI & CMA BHijit Goswami, CCM,ICAI.

th

CEP on “Enhancing Organizational Capabilities – Caselet Approach” organized byEIRC on 18 April 2016 at EIRC Auditorium. CMA Bibekananda Mukhopadhyay &

CMA Cheruvu Venkata Ramana presenting memento to CMA T.C.A.Srinivasa Prasad,Former, ED, SAIL.

th

CEP on “Union Budget – 2016 and Applicable Provisions for Service Tax,Excise & Customs” on 4 May 2016 at EIRC Auditorium. CMA Mrityunjay Acharrjee,

Sr Vice President, Balmer Larwie & Co. Ltd is being presented a Memento.

th

CMA (Dr) D.P.Nandy, Director, Research & Journal, ICAI addressing - CEP on“Cost Competitiveness in SME Sector” organized by EIRC on 26 April 2016

at EIRC Auditorium.

th

EIRC of ICAIChairman

Vice-Chairman

Secretary

Treasurer

Members

(R.C.M)

(R.C.M)

(R.C.M)

(R.C.M)

(V. P. / C.C.M)

(C.C.M)

(C.C.M)

(C.C.M)

CMA Shiba Prasad Padhi

CMA Bibekananda Mukhopadhyay

CMA Pranab Kumar Chakraborty

CMA Ashis Banerjee

CMA Shyamal Kr Bhattacharjee

CMA (Dr.) Umar Farooque

CMA Cheruvu Venkata Ramana

CMA Arundhati Basu

CMA Manas Kumar Thakur

CMA Avijit Goswami

CMA Niranjan Mishra

CMA Biswarup Basu

* R.C.M = Regional Council Member

* C.C.M = Central Council Member

OfficersP. Banerjee

Debosmita Sengupta

T. Ghosh

: 2455-3418/5957, Ext- 109

PD & Education Officer (D) 6456-3602

: 2455-3418/5957, Ext- 110

Officer (PD & Statutory Compliance) (D) 6450-4305

In-charge ofAccount & Finance

: 2455-3418/5957

Education Officer, (Computer Course) (D) 6456-3600

(

(

(

TARIFF FOR ADVERTISEMENT

EIRC NEWSEIRC OF ICAI, CMA BHAWAN, 84, HARISH MUKHERJEE ROAD, KOLKATA-700 025

4th Cover : Rs. 20,000/- Per Insertion

2nd/3rd Cover : Rs. 16,000/- Per Insertion

Colour Page : Rs. 13,000/- (inside)

Ordinary full page : Rs. 10,000/- Per Insertion

Ordinary half page : Rs. 7,000/- Per Insertion

A discount of 10% would be offered for booking of six insertions at a time.

A/C. Payee Cheque is to be issued favouring “The Institute of Cost Accountants of India - Eastern India Regional Council.”

Language– English, overall size– 24cms. x 18 cms. Printed Area– 21 cms. x 16 cms. – Screen up to 85.

Technical Details :

Contents

DisclaimerThe views and opinions expressed or implied by way of articles in the EIRC NEWS are those of the authors and do not necessarily

reflect those of the EIRC of ICAI. EIRC of ICAI bears no responsibility for the contents in the articles published.

CHAIRMAN’S COMMUNIQUE 4

MEMBER’S SECTION

11

STUDENT’S SECTION

Quiz Master Page 21

ChapterActivities 22

EIRCActivities 22

CMAAjay Deep Wadhwa

SECRETARY’S COMMUNIQUE 5

NEWS

Sustainable Development of Higher Education 7

in India: A Study

Carbon Credits :An Indian Overview

Space Management for Fruits in Retail Outlet: 15

A case Study based on Big Bazar, Durgapur

Biswajit Paul

Dr.Arindam Ghosh

Sudipta Halder

CHAIRMAN’S COMMUNIQUE

EIRC NEWS 4

Vol. 9 No. 04 May, 2016

Respected Members & Beloved Students

We have the pleasure to inform you that EIRC is organizing a series of Seminars & workshops on contemporary topics for the

professional development of the members. On 17 April 2016 Members Meet was organized by EIRC at EIRC Auditorium.

The details of activities undertaken by the EIRC were discussed & the future action plan was also presented before the

members. The Members meet was very interactive & suggestions of members were also noted.

CEP on “Enhancing Organizational Capabilities – Caselet Approach” was organized by EIRC on 18 April 2016 at EIRC

Auditorium. CMAT.C.A.Srinivasa Prasad, Former, ED, SAILwas the Speaker.

Another CEPon “Cost Competitiveness in SME Sector” was organized by EIRC on 26 April 2016 at EIRCAuditorium. CMA

(Dr) D.P.Nandy, Director, Research & Journal, ICAI was the Speaker.

CEP on “Union Budget – 2016 andApplicable Provisions for Service Tax, Excise & Customs” on 4 May 2016 was organized

by EIRC at EIRC Auditorium. CMA Mrityunjay Acharjee, Sr Vice President, Balmer Larwie & Co. Ltd & CMA Abhijit

Khasnobis, Practicing Cost Accountant were the Speakers on the occasion. CEP on Commodities & Derivatives market” was

organized by EIRC on 9 May 2016 at EIRC Auditorium. Mr. Vibhor Tandon –

& Mr. Diptendu Moulik

were the speakers.

We are also organizing training programmes for the students on a regular basis.

With Best Wishes

th

th

th

th

thAssistant Vice President (AVP) -Multi

Commodity Exchange of India Ltd – Senior Executive - Multi Commodity Exchange of India

Ltd

CMA Shiba Prasad PadhiChairman, EIRC of ICAI

SECRETARY’S COMMUNIQUE

EIRC NEWS 5

My dear professional colleagues,

Election process in the state of West Bengal is also in the last phase. The last date of election will be held on 5 May'2016 .Total

process of the election will be ended on 19 May, 2016 and New Government in the State of West Bengal will be formed thereafter.

We the professional people will act on behalf of the Government in Power for the sake of the interest in all financial matter in the

state of Govt. of West Bengal. On the other hand, in the wake of panama paper leaks a special Organization for Economic Co-

operation and Development (OECD) meet has to firm up co-operation between countries. Our Government has also set a Multi-

Agency Group(MAG) to investigate the Indian names and entities mentioned in the leaks .The MAG comprises officials from IT

Department, RBI ,Financial Intelligence Unit, Enforcement Directorate and Foreign Tax and Tax Research . It has been disclosed

that certain Indian have allegedly stashed away in offshore entities in Panama which is considered to be a tax heaven. We should

keep our close eyes on the happenings for changes to come and we have to consolidate internationally and to focus more on global

tax management.

Like earlier years EIRC has planned 37 Regional Cost Conference (RCC) on the theme “Managing Cost and taking successful

business decisions –Competency of CMAs” on 11 & 12 June,2016 at Science City Mini Auditorium, Kolkata .There will be

4(four) technical sessions on current topic of academic interest . Members and Students are requested for their active participation

for their all-round patronage, advisory & Co-operation for making this conference a grand success.

The Corporate laws, Governance and Corporate Sustainability Committee of the Institute has announced for celebration of World

Earth Week from 16 to 22 April'16. Accordingly, EIRC has participated the programme by the activities of tree sapling at its

premises on 17 April'16. Similar type of programme has also been organized by the chapters in this region.

During this month, EIRC has organized workshop at its premises on 18 April'2016 on “Enhancing Organizational Capabilities-

Case let approach “.The key speaker was CMA TCA Srinivasa Prasad, Former ED, SAIL. EIRC has also arranged another

workshop on “Cost Competitiveness in SME Sector” on 26 April'16 wherein the key speaker was CMA Dr. D.P.Nundy, Director

(Research) of the Institute.

It was my proud privilege to attend the workshop organized by the Howrah Chapter on the theme “International Taxation & Internal

Audit under the Companies Act'2013 and ROC creation of Charge & discharge of charge “ on 9 April'16 .The key speakers were

CMAMrityunjoyAcharya ,Sr.VP, Balmer Lawrie and CS Haransraj Jaria ,Company Secretary , Tata –SAILJt.Venture Ltd.

I am happy to inform that the shortfall for mandatory training of 15 hours for the year 2015-16 has been extended to 30 June, 2016

to facilitate renewal of Certificate of Practice (COP) .The Institute has now planned for series of the webinars on latest topic for the

th

th

th

th th

th nd

th

th

th

th

th

Activities of the Chapter & the Region:

Vol. 9 No. 04 May, 2016

EIRC NEWS 6

interest of the members in practice .It has already started its activities fromApril'16 itself.

Campus Placement Programme conducted for December, 2015 qualified students has been successfully done in 1 phase wherein

23 EIRC CMA pass out got selected in the campus placement of our Institute. Heartiest congratulations to all the successful

candidates. EIRC also planned for more Campus Placement for the passed out members in 2 phases very shortly.

Members meet has been organized by EIRC at its premises on 17 April, 2016 in presence of almost all the CCMs and RCMs from

EIRC though response from the members was poor during that occasion. We have planned for another member's meet may be

arranged at EIRC in the 3 week of May, 2016.

I on behalf of EIRC , offer my sincere gratitude to the President of our Institute who took initiative for a meeting of Vice-President of

our Institute with the officials of Bihar State Power Holding Company Ltd (BSPHCL) for revision of recruitment criteria for filling

up of 52 posts of Accounts Officers to include Cost Accountants with other professional of finance background .I also offer my

heartiest thanks to our RCMs and members from Patna Chapter who took positive steps for the betterment of our profession.

In the Institute portal Mock Test Papers (MTP) for the term June'16 in respect of Foundation, Intermediate and Final Syllabus has

been hoisted in the Institute Portal for the guidance of the students appearing for the ensuing examination.

I heartily welcome all new associate and fellow members of the Institute who have enrolled themselves during this month. We

highly appreciate this initiative of applying for Membership (Associate & Fellow) as it gives a proud feeling of being a part of the

profession, also through this move we grow in numbers which in turn strengthens our professional hold over the industry as well as

the ministry.

I sincerely wish prosperity & happiness to all members, students and their families on the occasion of May Day,Akshya Tritiya and

Buddha Purnima.

Let us live together with love, peace and harmony.

I once again extent my warm regards and best wishes to all the members and their families.

With warm regards.

st

nd

th

rd

CMA Pranab Kr. Chakrabarty

Secretary, EIRC of ICAI

Vol. 9 No. 04 May, 2016

EIRC NEWS 7

Introduction :

Objectives of the study

Methodology of the study :

Indian Higher Education Scenario :

This paper presents the higher education (HE)scenario in India, requirements for higher educationalinstitutions to becoming sustainable, practices for institutionsinvolved in delivering higher education and the challengesfaced by higher education in India. Education is a prerequisitefor promotion the behavioural changes and providing allcitizens with the key competences needed to achievesustainable development. Success in revising unsustainabletrends will, to a large extent, depend on high-quality educationfor sustainable development. Since higher educationinstitutions educate and train decision makers, they play a keyrole in building more sustainable societies and creating newparadigms.As educational institutions, they have the mission topromote development through both research and teaching,disseminating new knowledge and insight to their students andbuilding their capabilities. Higher Education Institutions have aspecial responsibility to provide leadership on education forsustainable development. Education for sustainabledevelopment aims at enabling everyone to acquire the values,competencies, skills and knowledge necessary to contribute tobuilding a more sustainable society. This implies revisingteaching content to respond to global and local challenges. Itshould also promote teaching methods that enable students toacquire skills such as interdisciplinary thinking, integratedplanning, understanding complexity, cooperating with others indecision-making processes, and participating in local, nationaland global processes towards sustainable development.

To understand the concept of sustainable development.To overview on Indian higher education scenario.To explore the need and significance of sustainability foreconomic and social development of higher education.To study the present challenges to higher education.To suggest the future prospects of higher education in India.

The present study is descriptive innature. The data used for the study is secondary in nature andhas been collected from Books, Magazines, Newspapers,ResearchArticles, Research Journals, E-Journals, and websites.

It has been nearly sixdecades since the Government of India started planned

l

l

l

l

l

development for higher education particularly with theestablishment of University Grants Commission (UGC) in1953. The present approach towards higher education isgoverned by the "National policy on Education"of 1986 andprogram of action of 1992. The 1986 policy and action plan of1992 was based on the two land marks report namely, the"University Education Commission"of 1948-49 (popularlyknown as Radhakrishnan commission) and the "EducationCommission" of 1964-66,(popularly known as KothariCommission Report). These two landmark reports in fact laiddown the basic framework for the National policy for highereducation in the country. The Radhakrishnan Commission onUniversity Education, 1948-49 had laid down the goals ofdevelopment in the following words: "The most importantand urgent reform needed in education is to transform it, toendeavor to relate it to the life, needs and aspirations of thepeople and thereby make it the powerful instrument of social,economic and cultural transformation necessary for therealization of the national goals. For this purpose, educationshould be developed so as to increase productivity, achievesocial and national integration, accelerate the process ofmodernization and cultivate social, moral and spiritualvalues." The national policy on higher education of 1986translated this vision of Radhakrishnan and the KothariCommission laid down the five principles goal for highereducation viz., Greater access, Equal Access(or Equity),Quality and excellence Relevance and promotion of socialvalues.The policy directions and actions covered in 1992"program ofAction "translated the above goals into practice.Expansion in higher Education Institutional Capacity Eversince the early 1950s higher education in India has seen quite asignificant rise. The number of Universities has increasedfrom 20 in 1947 to about 564 in 2010-11 indicating a twentyfold (approx.) increase. There are now 43 Central Universities,297 State Universities, 129 Deemed Universities, 100 PrivateUniversities and65 institutes of National importance&OtherUniversity level Institutions (Chart-1).The number of colleges increased from 500 in 1947 to about33023in 2010-11 indicating a forty-eight fold increase.Similarly the number of teaching staff in Universities and

MEMBER’S SECTION

Sustainable Development of Higher Education inIndia: A Study

Biswajit Paul

Department of Commerce (Post Graduation under Calcutta University)Naba Ballygunge Mahavidyalaya, Bosepukur, Kolkata

biswajitpaul88@yahoo.com

Vol. 9 No. 04 May, 2016

EIRC NEWS 8

Colleges increased from 0.24 lakhs in 1950-51 to 8.17 Lakhsin 2010-11 indicating thirty-five fold increases. As far thestudent enrolment is concerned it increased from 3.97 Lakhsin 1950-51 to 169.76 Lakhs to 2010-11.

Source: Higher education in India at a Glance, UGC, February2012Thus there has been several fold increase in the educationalinstitutions and number of teachers. With this progress in theeducational infrastructure in terms of institutions and faculty itcan be said that there has been improvement in the level ofhigher education in terms of aggregate access, access todisadvantages groups and the quality of higher education. Table1 shows the institutional capacity in higher education in India.

Source: Higher education in India at a Glance, UGC, February2012

The reports prepared for financial sustainability strategygroup (FSSG) by JM Consulting in June 2011 highlight thefollowing conditions required by institutions for managingtheir sustainability.

The institution must be financially healthy i.e., whetherthe institution has been generating enough cash (and willcontinue to do so) to finance its operations and necessaryinvestment.It must have an institutional (academically-driven)strategy which takes account of the strategic landscapeand sets out (realistically) where the institution wishes tobe in the medium term say5-10 years.It needs to spend enough on its recurrent budgets to investin and maintain a healthy and vibrant academiccommunity, and other support services and resourcesneeded in a higher education institution appropriate for its

Chart 1:Type-wise Distribution of Degree awardingUniversities/University level Institutions: December, 2011

Table 1: Institutional capacity in Higher Education

What do institutions need to do in order to be sustainable?

l

l

l

academic strategy.It needs governance and management skills and processesto develop and deliver these plans, involving a wide rangeof stakeholders as appropriate (including most importantly,staff students and principal funding bodies). An institutionwhich cannot command the confidence of its stakeholderswould probably not be sustainable.It needs appropriate processes for reviewing andmonitoring its own performance (KPIs, strategy reviews,benchmarking, audit etc.)and for adapting its strategy andoperations accordingly. The KPIs need to reflect bothcurrent and forecast performance (in a 2-5 year timeframe)towards the longer-term strategic targets (5-10 years).

Highereducation has the capacity and responsibility to makesignificant commitment to climate and sustainability action forthe sake of their students and society. Efforts need to be made toinculcate the practices in Indian Universities and colleges on agreater scale. These institutions across the country can take uphundreds of project to reduce energy use, reduce green houseemissions and save money in the process-demonstratingpowerful and necessary leadership for the rest of the society.According to an article published in the New England Journalof Higher Education on may 21,2012 the three wordspreparedness, Opportunity and innovation capture the essenceof Higher education`s critical role in creating a just andsustainable society. Leaders in higher education are standing upto the greatest challenge of our time by providing education forsustainability, preparing graduates to create a sustainableeconomy. They are providing the opportunity for more studentsto access higher education by reigning costs through energyefficiency and smart building. Understanding sustainability isrequired for career preparedness in the 21st century. Highereducation is stepping up to the challenge of creating new waysof teaching and learning that address the complex anddiscipline-crossing nature of "education for sustainability".Still, there much work to be done. The vast majority of teachingand learning still reinforces ways of thinking that lead tounsustainable systems in every sector. The vast majority ofstudents still graduate without a deep understanding ofsustainability principles; without fully appreciating how thedecisions they make in their person and professional livesimpacts- directly and indirectly, now and in the future - thesocial and ecological systems upon which our civilizationdepends. Higher education is under pressure to improve accessand affordability to ensure as many people as possible have theopportunity to earn a degree. It`s critical to our economic well-being and competitiveness. Sustainability efforts are oneeffective, and essential, way to reduce costs now and mitigatefinancial risk for the future. Higher education has a very realresponsibility and moral obligation to continue and accelerateits leadership for sustainability, with institutions workingtogether and beyond their campus borders to lead the systemicshifts needed. Colleges and Universities have the means and the

l

l

Importance of sustainability in Higher Education :

Vol. 9 No. 04 May, 2016

Institutional capacity indicator 1950-51 2010-11

Number of University levelInstitutions, including 100private universities

30 634

Number of colleges 700 33023

Number of teachers 23549 816966

Number of students Enrolled 397 16975

EIRC NEWS 9

mandate to lead the creation of a sustainable economy-aneconomy that more effectively meets the needs of more peoplefor generations to come. Success will require continued boldleadership, increased collaboration across the sector, and newways of thinking about how we teach, learn and operate for ahealthy, thriving and sustainable future. Several principles ofsustainable development are embedded in India`s educationpolicy. It is perhaps the only country where the highest court hasmandated environmental education at all levels of formaleducation, which includes a compulsory undergraduate course.However, the challenges of implementing this requirementeffectively are hampered by lack of inter-disciplinarycompetence among staff and students, and traditional method ofassessment in HE. India has examples of successfulcommunity-based initiatives but these often have resourcesimplications. Many efforts to develop learning opportunities inthis field have emerged primarily from academic and studentsinterests and priorities rather than from formal policy initiatives.

India is strugglinghard deal with the problem of increasing access. Thepublic system is not able to cater to the increasingdemand; therefore, private sector has been trying to meetthe unmet demand. There has been mushrooming ofprivate institutes across the country. "People who ranfamily -owned businesses in garments, sweets andmanufacturing are becoming "edupreneurs".Avariety ofgeneral as well as niche institutes have emerged" (EduTech, 2009, p.38). These institutes have been spendingaround Rs.150 million annually on advertising andpromotional activities to attract students. The feescharged by these institutes are exorbitant. This has givenrise to the problem of equity and quality. There is anurgent need for regulatory institutions to ensure qualityof higher education. The government needs to regulatethe fees charged by such institutes. While the cost ofeducation is going up, the access opportunities fordeserving candidates belonging to economicallybackward community is not increasing with acommensurate pace. There is a need for more merit-based scholarship schemes and also availability of easierand cheaper bank-loans.

Another major challenge in thissector is that of low participation rate which is reflectedin low Gross Enrolment Ratio (GER). In India GERstands at 11% which is low as compared to the worldaverage of 23.2%, 36.5% for countries in transition,54.6% for the develop countries, and 22% for Asiancountries. Not only this, there are disparities in GER asshown in the Table 2. Therefore, inclusive education hasbeen an elusive target and there is an urgent need forexpansion of higher education institutions. AlthoughTable 1 shows a healthy growth in numbers they arebasically paradoxes and problems. Number of students

Challenges for Higher Education in India(a) Accessibility and Affordability :

(b) Low Participation :

has grown at a slower pace as compared to the number ofuniversities and colleges. This has resulted inoversupply of seats and many of which remain vacant.For e.g., Andhra Pradesh had over 600 engineeringcolleges which have at least 50,000-60,000 vacant seatsdue to the reckless sanctioning of colleges and seats bythe All India Council of Technical Education (AICTE).Similarly in the academic year 2010-11, Maharashtrahad 30000 vacant engineering seats and 20000 vacantmanagement seats.

Disparities GER

Area

i) Rural 6.70

ii) Urban 19.90

Gender:

i) Male 12.40

ii) Female 9.10

Social:

i) Scs 6.57

ii) Sts 6.52

iii) OBCs 8.77

iv) Others 17.22

ALL 11.00

Source: Eleventh Five year plan,p.22In India, enrollment in the higher

education space is increasing but the pool of teaching isnot growing. According to a recent report of HRDMinistry premier educational institutes like the IndianInstitute of Technology (IITs) and the Indian Institute ofmanagement (IIMs)are facing a faculty crunch withnearly one-third of the posts vacant. According to areport published in Indo-Asia News service (IANS)around 35 percent posts are vacant in the centraluniversities, 25 percent in the IIMs, 33.33 percent in theNational Institute of Technology (NITs) and 35.1percent in other central education institutions coming upunder the Human Resource Development (HRD)Ministry. However in order to overcome this,government is planning to have short-term measureslike raising the retirement age in teaching posts from 62to 65 years and enhancement in salaries and otherbenefits for teachers. Also some long-term measureshave also been initiated for attracting young people toopt for this (teaching) career. These includeenhancement in fellowships and attractive Start-upgrants in various disciplines.

The quality of higher education would dependupon quality infrastructure laboratories, libraries, workspace and other facilities and also upon the availability of

Table 2: Disparities in GER 2004-05

(c) Faculty Drought :

(d) Quality :

Vol. 9 No. 04 May, 2016

EIRC NEWS 10

quality teachers. But contrary to the needs of the hour, theinfrastructural facilities are not adequate and the highereducation system is witnessing the phenomenon of"missing teachers". A study reveals 25.6% of the teacherssurveyed had doctorate degrees. In addition, the"Education of Educators" is lacking as has been pointed outby YashPal. The spending by universities on upgrading theskills of teachers and exposing them to new methodologiesis lacking. There 55 Academic staff Colleges in India forconducting four weeks orientation programmes and threeweeks refresher courses for serving teachers but theirnumber is inadequate. Moreover, their functioning has notbeen evaluated so far. Further, it has been reported in aUGC survey that the average expenditure per teacher onseminar in India and abroad was just Rs.598 and Rs. 829respectively. It has also been noted by the NationalKnowledge Commission that the universities prefer theirown alumni rather than the best available talent andtherefore it tends to lower down the quality of teachers andfosters parochialism. "Cross pollination is necessary foropening up of minds," notes the Commission (seeNaryanan, 2009). To ensure the effectiveness of teachinglearning process in addition to the above, there is a need toopening up access to global faculty, curriculum sharingacross universities. This is very cost effective method as itsaves on logistics and transportation. Yashpal Committeeand Chadha committee have recommended introducingpay parity, encouraging research, promoting eveningMaster doctoral programmes to attract working peopletowards further studies and research. Other have called formore private investment and industry universityinteraction, decentralized, professional and accountablemanagement (good governance) in higher educationalinstitutions is another need.

"The crisis of governance in Indianhigher education is most visibly manifest in the acuteshortage of qualified faculty. The generation that wasinspired by a broad commitment to the public good hasretired or will do so soon. There is little likelihood ofsufficient replenishment, given entrenched mediocrity ininstitutions with lifetime appointments, few competitivepressures and abysmal governce. The result has been theacademic equivalent of Gresham`s law-the bad drives outthe good. The prevailing political ideological climate inwhich elite institutions are seen as anti-democratic, findsits natural response in political control to influenceadmissions policies, internal organization, and thestructure of courses and funding. As quality deteriorates,students are less and less willing to pay the very resourceswithout which quality cannot be improved. In India`s case,the answer has been the growth of private sector highereducation institutions and increasingly the consumption ofeducation abroad. However, as our analysis suggests,private sector investment has been confined to professional

(e) Governance Issues :

streams, bypassing the majority of students. Furthermore,private institutions are also plagued by severe governanceweaknesses, raising doubts as to their ability to addressesthe huge latent demand for quality higher education in thecountry" (Kapur and Mehta, 2007, p.43).

Research and highereducation are complementary to each other. According tothe available official statistics the expenditure on R&D inthe field of Science & Technology as a percentage of grossdomestic products (GDP) was 0.8 percent during the year2005-06 in India. For perspective, countries spending themost on S &T as a percent of their GDP were Israel (5.11%), Sweden (4.27 percent), Japan (3.11 percent), SouthKorea (2.95 percent), the United States (2.77 percent),Germany (2.74 percent), and France (2.27 percent).Amongother countries, China (1.54 percent), Russia (1.74percent),U.K. (1.88 percent) and Brazil (1.04 percent) havespent more than India. Moreover, India`s higher educationinstitutions are poorly connected to research centers. So thisis another area of challenge to higher education in India.

Due to time constraint this researchstudy has been made on the basis of previous data. This studymay be updated and redesigned by considering the latestavailable data.

Lethargic approach to economicimperatives may seriously undermine the groundwork forsustainable development. Institutions of higher learningought to be a major force in society not only for producingleaders in Science and technology, but also for downstreamchanneling of progressive social, moral, and political valueswhile keeping in perspective temporal realities and spatialconstraints. Higher education reform efforts aim atindependent, strong, and objective analysis of ground reality.A clear sense of direction and pace will help in optimallybalancing out the apparent tradeoffs in favour of sustainabledevelopment. The central objective of the 11th plan is nowfocused on Expansion of enrolment in higher education withinclusiveness, quality and relevant education and supportedby necessary academic reforms in the university and collegesystem in India. It is equally necessary that individual stateand central government also take similar initiative in theirrespective state plan and develop policies to address the aboveissues at war footing. The statics of growth in institutionalcapacity do not capture the twin problem of quality andemployability. In order to transform itself from developing todeveloped Indian educational system needs to employqualitative faculty and bring about major reforms that includesocial justice, competence academic freedom, autonomy vsaccountability and decentralization vs centralization.Students and families are increasingly seeking educationwhich may improve their prospects of employability andupward mobility. Institutions and policy makers need to listento the qualitative dimension of the demand and adapt to it toremain relevant, competitive and sustainability.

(f) Research and development :

Limitation of study :

Concluding Observation :

Vol. 9 No. 04 May, 2016

EIRC NEWS 11

Abstract :

Introduction :

This paper related with environmental challenges,such as climate change, air and water pollution. These occurwhen the assimilative capacity of a particular environmentalresource is exceeded. Society is affected by the resultingpollution, and the polluter is often not held accountable for thecosts of such pollution. In economic theory, this is defined as anegative environmental externality, and therefore a marketfailure, because the costs of pollution are not reflected in thefinal prices of the goods and services. In order to correct marketfailures and include these external costs in the prices of goodsand services, and hence ensure efficient and environmentallybeneficial outcomes, the government intervenes by way ofregulations or market-based instruments to influence thedecision-making processes of producers and consumers.Ideally, a carbon price should reflect the marginal externaldamage costs of carbon emissions. Several studies haveattempted to quantify the costs of climate change to society.Regulatory measures include emissions standards and thebanning of certain goods and services. Market-basedinstruments comprise levying environment-related taxes,allocating pollution rights through tradable permit systems,and granting subsidies for environmental improvements.Regulatory, command-and-control policies requirequantitative restrictions on the level of pollution allowed.Market-based instruments operate through the pricemechanism and involve setting a price on the unpriced elementor pollution causing the initial market distortion. For thepurpose of our study, I have exclusively used secondary datawhich were collected from various reports, scholarly articlesin this field and the relevant websites on the internet, of course,keeping in mind the convenience and time limitations.

Carbon credits may be discussed andformalized in the Kyoto Protocol. In December 1997, theThird Conference of Parties (COP) to the United NationsFramework Convention on Climate Change (UNFCCC)adopted the Kyoto Protocol. The protocol requires developedand developing countries to limit their Greenhouse Gas(GHG) emissions to individual targets. Carbon emissionstrading are a form of emissions trading that specifically targetscarbon-di-oxide (calculated in tones of carbon-di-oxideequivalent or tCO2e) and it currently constitute the bulk ofemissions trading. This form of permit trading is a common

method countries utilize in order to meet their obligationsspecified by the Kyoto Protocol; by reducing of carbonemissions in an attempt to reduce future climate change.The idea behind carbon trading is quite similar to the trading ofsecurities or commodities in a market place. Carbon would begiven an economic value, allowing people, companies ornation bought carbon, it would be buying the rights to burn it,and a nation selling carbon would be giving up its rights toburn it. The value of the carbon would be based on the abilityof the country owing the carbon to store it or to prevent it frombeing released into the atmosphere.Amarket would be createdto facilitate the buying and selling of the rights to emit green-house gases. The industrialized nations for which reducingemissions is a daunting task could by the emission rights formanother nation whose industries do not produce as much ofthese gases. The market for carbon is possible because the goalof the Kyoto Protocol is to reduce emissions as a collective.On the one hand, the idea of carbon trade seems like a win-winsituation: green-house gas emissions may be reduced whilesome countries reap economic benefit. On the other hand,critics of the idea suspect that some countries will be negative.While the proposal of carbon trade does have its merits, debateover this type of market is inevitable since it involves finding acompromise between profit, equality and ecological concerns.

Green-house gases are major pollutants ofenvironment and itsreduction has become a strategic issueworld over.Among the various approaches to their reduction,the commercial strategy of issuing of CERs and their trading -as financial in the Kyoto Protocol - has added anotherdimension to the financial market mechanisms. Since 2000,as a financial product, the emission trading has started in a bigway. By 2008, $ 119 billion worth of trading had taken placein voluntary and regulatory markets. However, the size of thelatter is much bigger. Among the trading platforms EU ETShasemerged asthe largest trading platform for carbon credittrading. In India, CERs are generated through the CDMmechanisms and its world position stands only next to China.Considering the low level of pollutions India has a vastpotential of generating CERs and reaping benefits out of itstrading. Though trading has recently started though MCX, thepoor awareness among the industries, lack of development ofefficient trading mechanisms and its related infrastructures,

Background :

MEMBER’S SECTION

Carbon Credits : An Indian Overview

Dr. Arindam Ghosh

Associate Professor & Head, Department of Commerce, Panihati Mahavidyalaya, Sodepur, Kolkata,West Bengal

Vol. 9 No. 04 May, 2016

EIRC NEWS 12

and dearth of proper consultancy service are some of thehurdles in the development of the carbon market in India.

Formally, the firstWorld Climate Conference 1979, recognized climate changeas a serious problem. A number of inter-governmentalconferences focusing on climate change were held in the late1980s and early 1990s. Inter-governmental Panel on ClimateChange (IPCC) released its First Assessment Report in 1990.Finally, Earth Summit in 1992 shaped the commercialapproach to address the climate change problem whichculminated with a target based CO2 reduction strategy inKyoto in 2005. The overall goal of an emissions trading plan isto reduce emissions. If we trace the history of emissionstrading, the proposals initiated by the Technocracy movementof the 1930s in USA would probably come first. Technocracyproposed a system of Energy Accounting, or emissionstrading, to promote balanced and harmonious developmentthrough-out the world. The present trading system of CO2 hasits roots in the United Nations Framework Convention onClimate Change (UNFCCC), signed by 154 states (plus theEC) at the Earth Summit in Rio de Janeiro in 1992, and cameinto force on 21st March, 1994. Both developed anddeveloping countries accepted a number of generalcommitments. The main target of this pact was to reduceemissions of GHG. The Kyoto Protocol (KP), an amendmentto the UNFCCC, came into force on 16th February, 2005. The6 gases covered by the Kyoto Protocol are: CO2; CH4; N2O;Hydro - fluoro-carbons (HFCs); Per-fluoro-carbons (PFCs);Sulphur hexa-fluoride (SF6). Prerequisite for KP was thatAnnex 1 nations, i.e. developed nations, and economies intransition representing 55% GHG emissions ratify it.As of April 2009, 184 countries had signed up with 37industrialized countries having agreed to a target of reducingemissions by an average of 5.4% below 1990 levels over theperiod 2008 - 2012. Where, Annex 1 nations are required toadhere to an annual limit on the total amount of green-house gas

Kyoto Protocol and its mechanism :

emissions and must reduce their emissions, developing nationsthat are signatories to the Kyoto Protocol ("Non-Annex 1"nations) do not have a cap on their emissions, but must producean annual emissions inventory. So, KP recognizeddifferentiated responsibilities of industrialized and developingnations i.e. (a) Industrialized nations to own responsibility ofpast GHG emission levels responsible for to-days globalwarming; and (b) Developing nations to achieve a decouplingof GDP growth and emissions by promoting "sustainabledevelopment". In essence, signatories employ "flexiblemechanisms" to reduce GHG emissions in a cost effectivemanner, purchasing emission reduction units from otherparties that have reduced their emission. Under this flexiblemechanism this emissions can be achieved in three ways:1) Joint Implementation projects (JI), defined by Article 6 of

the Kyoto Protocol, which produces Emissions ReductionUnits (ERUs). One ERU represents the successfulemissions reduction equivalent to one tone of carbon-di-oxide equivalent (tCO2e). Under JI, countries can purchasesurplus reductions from "Annex 1" nation that has reducedits emissions below the required maximum level.

2) Clean Development Mechanism (CDM), defined byArticle 12, which produces Certified EmissionReductions (CERs). One CER represents the successfulemissions reduction equivalent to one tone of carbon-di-oxide equivalent (tCO2e). Under the CDM, countries canpurchase reduced emissions from "Non-Annex 1"nations. The main objectives of the CDM are twofold:

(i) To help developed countries meet their emissionreduction commitments through projects in developingcountries, and,

(ii) To enable developing countries to achieve sustainabledevelopment from low carbon or high-energy efficienttechnologies. The mechanism enables projects indeveloping countries to access additional sources offinancing if they can demonstrate that the project isgenerating emission reductions additional to those in thebase-line or 'businesses-usual' scenario. As the CDM is aperformance-based incentive, project developers needaccess to upfront resources for implementation. By itsnature, the CDM is easy to combine with other sources offinancing, as it adds to the revenue stream of the project.

3) International Emissions Trading (IET), defined byArticle 17, Emission trading is an allowance basedtransaction system that enables developed countries andcountries with economies in transition to purchasecarbon credits from other developed countries andeconomies in transition to fulfil their emissions reductioncommitments.

Carbon emissions trading have been steadilyincreasing in recent years. According to the World Bank'sCarbon Finance Unit, 374 million metric tones of carbon-di-oxide equivalent (tCO2e) were exchanged through projectsin 2005, a 240% increase relative to 2004 (110 mtCO2e)

Market Trend :

Vol. 9 No. 04 May, 2016

MARKET MECHANISM

EIRC NEWS 13

which was itself a 41% increase relative to 2003 (78 mtCO2e).The increasing costs of permits have had the effect ofincreasing costs of carbon emitting fuels and activities. Basedon a survey of 12 European countries, it was concluded that anincrease in carbon and fuel prices of approximately ten percentwould result in a short-run increase in electrical power prices ofroughly eight percent. This would suggest that a lowering capon carbon emissions will likely lead to an increase in the costsof alternative power sources. Whereas, a sudden lowering of acarbon emission cap may prove detrimental to economies, agradual lowering of the cap may risk future environmentaldamage via global warming. In 2010 Chicago ClimateExchange (CCX) has ceased its trading of carbon emissions.

The primary proposal of the Protocol was tomake developed countries pay for their ways with emissionswhile at the same time monetarily rewarding countries withgood behavior in this regard. Since, developing countries canstart with clean technologies, they will be rewarded by thosestuck with dirty ones. This system poises to become a bigmachine for partially transferring wealth from wealthy,industrialised countries to poor, underdeveloped countries. ACER or carbon Credit is defined as the unit related to reductionof 1 tonne of CO2 emission from the base-line of the projectactivity. The forward Markets Commission has granted tradingpermission to carbon credits and is included in the list ofcommodities grant treading permission in the 'others' category.The Multi Commodity Exchange of India (MCX) entered intoan alliance with Chicago Climate Exchange in 2005 tointroduce carbon treading in India, providing further liquidityand greater expanse to the market. However, Indian commodityexchange does not allow direct participation of foreigninstitutions in India, restricting the trade in which largelybuyers are overseas buyers Forward Contracts (Regulation)Amendment Bill of 2006 if passed would be beneficial for themarkets as it would introduce option based trading in carboncredits and also determine the regulations for trading.

a) India - high potential of carbon credits.b) India can capture 10% of Global CDM market.c) Annual revenue estimated range from US $ 10 million to

330 million.d) Wide spectrum of projects with different sizes.e) Vast technical human resource.f) Strong industrial base.g) Dynamic, transparent & speedy processing by Indian

DNA(NCDMA) for host country approval.h) MOU Signed between MOP and GTZ (Oct; 2006) - Indo

German Energy program (IGEN)Base-line CO2 Emissions from Power Sector already inplace - first CDM country.Improvement in EE.CDM in Power Sector.

Green-house gasabatement policy design is exceedingly difficult because GHG

Carbon Credits :

Indian Scenario-Favouring Points

Policies and way ahead-Indian scenario :

l

l

l

emissions result from nearly all modern human activities. Itinvolves every sector of the economy as well as habits andchoices of individuals. Economics is more than just a study ofbusiness; it is the science which studies human behavior as arelationship between aspirations and the scarce means to reachthose goals. Individuals make decisions every day thatinfluence the amount of green-house gases that enter theatmosphere. If a stable climate is one objective among themany of which society aspires, then economics is a tool well-suited to understand how those decisions are made and howefficient and effective outcomes can be reached. India is aParty to the United Nations Framework Convention onClimate Change (UNFCCC) and the objective of theconvention is to achieve stabilization of green-house gasconcentrations in the atmosphere at a level that would preventdangerous anthropogenic inter-frence with the climate system.To strengthen the developed country commitments under theConvention, the Parties adopted Kyoto protocol in 1997,which commits developed country Parties to return theiremissions of green-house gases to an average ofapproximately 5.2% below 1990 levels over the period 2008-12. The Seventh Conference of Parties (COP-7) to theUNFCCC decided that parties participating in CDM shoulddesignate a National Authority for the CDM and as per theCDM project cycle, a project proposal should include writtenapproval of voluntary participation from the DesignatedNational Authority of each country and confirmation that theproject activity assists the host country in achievingsustainable development. Accordingly the CentralGovernment constituted the National Clean DevelopmentMechanism (CDM) Authority for the purpose of protectingand improving the quality of environment in terms of theKyoto Protocol. The Ministry of Environment and forests(MOEF) deals with climate change and CDM issues in India. Itestablished the Designated National Authority (DNA) inDecember 2003 as the national CDM Authority (NCDMA).The NCDMA is chaired by the Secretary of MOEF. The othermembers are the Ministry of External Affairs Secretary, theMinistry of Finance Secretary, the Secretary, Department ofIndustrial Policy and Promotion, the Ministry of Non-conventional Energy Sources Secretary, the Ministry of PowerSecretary, the Planning Commission Secretary and the MOEFJoint Secretary of Climate Change. The Member Secretary ofthe NCDMA is the Climate Change Director of MOEF. Theproject developers first submit the project Concept Note(PCN) and the Project Design Document (PDD). Thesedocuments are circulated for review by the NCDMAmembers, who then call the project developers for apresentation at a regularly scheduled once-a-month meeting.Any clarifications/additional information from the projectdevelopers are sought when required by the NCDMAmembers. If all the requirements are met, India gives hostcountry approval. The entire process for host country approvaltakes 60 days. No fees are charged by the National CDM

Vol. 9 No. 04 May, 2016

EIRC NEWS 14

Authority. The project developers then present their documentsto the CDM Executive Board for approval and registration.

All countries wishing to participate in the CDM must designationa National CDM Authority to evaluate and approve the projects,and serve as a point of contract. Although, the internationalprocess has given general guidelines on the base-lines andadditionality, each developing country has the responsibility todetermine the national Carbon Trading 13 criteria for projectapproval. Together with the investor, the host country mustprepare a project design document with the following structure:

- General description of the project.- Description of the base-line methodology.- Timeline and crediting period.- Monitoring methodology and plan.- Calculation of GHG emissions by sources.- Statement of environmental impacts.- Stakeholder Comments.

The National CDM Authority issues the necessary statementsthat the government participation is voluntary in the projectand confirms that the project activity assists the host countryin achieving sustainable development.

The carboncomponent of a mitigation project cannot acquire value in theinternational carbon market unless submitted to a verificationprocess designed specifically to measure and audit the carboncomponent. Therefore, once the project operational,participants prepare a monitoring report, including anestimate of CERs generated, and submit it for verification byan operational entity. Verificationis the independent ex-postdetermination by an operational entity of the monitoredreductions in emissions. The operational entity must makesure that the CERs have resulted according to the guidelinesand conditions agreed upon in the initial validation of theproject. Following a detailed review, an operational entity willproduce a verification report and then certify the amount ofCERs generated by the CDM project. Certification is thewritten assurance that a project achieved the reductions asverified. The certification report also constitutes a request areview within 15 days, the Executive Board will instruct theCDM registry to issue the CERs.

The basic principle of the CDM is simple: developed countriescan invest in low-cost abatement opportunities in developingcountries and receive credit for the resulting emissionsreductions, thus reducing the cutbacks needed within theirborders. While the CDM lowers the cost of compliance with theProtocol for developed countries, developing countries willbenefit as well, not just from the increased investment floes, butalso from the requirements that these investments advancesustainable development goals. The CDM encouragesdeveloping countries to participate by Carbon Trading promisingthat development priorities and initiatives will be addressed aspart of the package. This recognizes that only through long-term

How will CDM projects be approved nationally?

Monitoring, Verification and Certification :

How are countries to benefit from CDM?

development will all countries be able to pay a role in protectingthe climate. From the developing country perspective, the CDMcan: - Attract capital for projects that assist in the shift to a moreprosperous but less carbon-intensive economy. - Encourage andpermit the active participation of both private and public sectors.- Provide a tool of technology transfer, if investment is channeledinto projects that replace old and inefficient fossil fueltechnology, or create new industries in environmentallysustainable technologies. And, - Help to define investmentpriorities in projects that meet sustainable development goals.Specifically, the CDM can contribute to a developing country'ssustainable development objectives through: - Transfer oftechnology and financial resources. - Sustainable ways of energyproduction. - Increasing energy efficiency & conservation. -Poverty alleviation through income and employment generation.And, - Local environmental side benefits.

According and the creation of carbon marketsemerging from economic understandings of the roles thatpricing and the establishment of markets can play ininfluencing resource utilization, the Kyoto Protocol CleanDevelopment Mechanism and the subsequent establishmentof the European Emissions Trading Scheme resulted in a hugenew financial arena prior to the current economic crises. In2007 The Economist (2007, p.g. 10) reported that $ 30.4billion of allowances had been traded in the previous year,with Europe making up 80% of the total value, and the carbonmarket analyses and consulting group, Carbon Point,estimated that this figure was reached in only the first 6months of 2008 (Milner, 2008). The speed with whichfinancial institutions moved into the area and applied both thesimple and the more complex products of finance research toyet another area of human endeavour was truly remarkableand itself something worthy of a great deal of detailed andfinely tuned research in the coming years. Equallyremarkable however, has been the speed of retreat during thecurrent recession. With many corporations having surpluscarbon permits in hand, their price has collapsed during 2009,at least for the time being effectively eliminating their role inchanging corporate practices and technologies, and possiblyresulting in a questioning of the longer term effectiveness ofsuch approaches. For this and other reasons it is most likelystill far too early to fully appreciate the consequences of thevalues which resulted in the environmental concerns thatgave rise to a new market in carbon emissions with those verydifferent ones of the financial institutions that merely trade inthe resultant products. Questions are also being asked of thelikely speed with which such an approach can fundamentallychange emission patterns even in times of economicprosperity and growth, with some thinking that worth thoughthe intentions might be, the market led adjustments will betoo slow and thereby too late. As such questions imply, theconsequences of such a stark separation of treading from theunder laying concerns that gave rise to it are largely unknownat the present time.

Conclusion :

Vol. 9 No. 04 May, 2016

EIRC NEWS 15

Introduction

Retail is one of the fastest growing sectors in the world. Theretail landscape is changing in ways that are placingsignificant pressure on retailers. The intersection of long-termtrends-slow growth in mature markets, shifts in shoppinghabits, the development of new channels-and short-termchallenges caused by the economic recession means thatretailers must scrutinize every aspect of their operations andeliminate the inefficiencies they accumulated during recenttimes. It is sometimes said that success is the result of a goodplan well executed. For a retailer, plans are mostly formulatedat corporate headquarter and executed in their stores.Corporate planning functions include choosing theassortment of products to carry in each store at each point intime, setting store inventory levels and product prices, settingstaffing levels, determining how many stores to have andwhere they are located and creating the physical design ofstores and planograms that specify the location of all productswithin each store. A retail store is an interesting amalgam of afactory and a sales office and store employees are responsiblefor a wide range of execution tasks that collectively determinethe success of corporate plans. Factory related store executiontasks include receiving product, moving product from theback room to Shelves as needed, putting items moved by acustomer back to where they belong on the shelf and checkingcustomers out. Academic research to date has focused almostexclusively on these planning functions. The operationsmanagement literature includes numerous papers oninventory optimization that are applicable to setting plannedinventory levels in a retail store. Because of the supermarketled initiatives, organized retailing in Fruits &Vegetables isquite advanced in many developing countries of Africa, Asiaand Latin American countries -Kenya, China, Brazil, andArgentina.

Indian organised retail sector is in a nascent stage, with a fewmajor players, compared to the 15 million kirana storesthrough which more than 90% of retailing happens in India.However, with the middle class Indian population anddisposable income of the young population increasing,organised retailers were almost on the verge of a major

breakthrough. New players are entering the retail sector withdifferent formats and incumbents are continuouslyexperimenting to attract customers. But understanding theIndian customer remains a tough task as many of the retailershave failed to establish their formats and many are onlymoderately successful. The most successful model seems tobe Future Group's Big Bazaar which had received lot ofaccolades for the innovative model and 'dead cheap' pricesthat even the lower class can afford. Starting from a smallshowroom in Mumbai, Pantaloon Retail has changed to arolling juggernaut named Future Group. With lots of shop-in-shop formats and many other independent retail chains,Future Group is in an admirable position in the retailing fieldof India. However, Future Group is not free from competitionthough many of its competitors are far behind. One of thecompetitors, a late comer to the field of retailing, ITC (earlierImperial Tobacco Company) has changed its image of acigarette maker to a socially responsible conglomeratethrough its innovative initiatives in retailing andagribusiness. Its rural retailing initiative through ruralshopping mall ChoupalSagar and innovative IT project, e-choupal, intended to help farmers had helped it to change theretailing picture in the rural areas. Soon, with its retail-wholesale vegetable and fruit outlet Choupal Fresh, it made agrand entry to the urban retail sector. Moreover, its food andstaples brands such as Ashirvaad and Kitchens of India arebestselling national brands and are sold even through itscompetitors' outlets and a great number of kirana stores. ButITC's retailing strength lies in Lifestyle Retailing BusinessDivision (LRBD), which sells the Wills Lifestyle brands ofcasual and formal wears. With the help of latest technologyand a desire to make it big, LRBD has already become famouswith its brands like John Players and Miss Players. Thepotential of Indian retail sector has lured many of the businesscorporations since its inception. One of the latest entrants inthe retail field is the largest public company in India, RelianceIndustries Limited (RIL). Though, initial retailing model ofReliance Fresh, a retail chain to sell fruits, vegetables andstaples was not a success. The Indian retail sector is highlyfragmented with 97 per cent of its business being run by the

MEMBER’S SECTION

Space Management for Fruits in Retail Outlet: A caseStudy based on Big Bazar, Durgapur

Sudipta Halder

Research Scholar, Department of Commerce & Management, West Bengal State University, Barasat,North 24 Parganas

Vol. 9 No. 04 May, 2016

EIRC NEWS 16

unorganized retailers like the traditional family run stores andcorner stores. The organized retail however is at a verynascent stage though attempts are being made to increase itsproportion to 9-10 per cent by the year 2010 bringing in a hugeopportunity for prospective new players. The sector is thelargest source of employment after agriculture, and has deeppenetration into rural India generating more than 10 per centof India's GDP. Over the past few years, the retail sales in Indiaare hovering around 33-35 per cent of GDP as compared toaround 20 per cent in the US. The table gives the picture ofIndia's retail trade as compared to the US and China.

Trade (US$ Employment Shops Organized

billion) (%) (million) sector share

(%)

India 180-394 7 12 2-3

China 360 12 2.7 20

US 3800 12.6-16 15.3 80

Source: The Economist

Now a day we see that the awareness about retail store isincreasing in different cities. The market strategy is sodifferent from the traditional market places and so attractive tothe customer that market is increasing at leaps and bounds forthe retail outlet store (E.g. Big bazar, Spencer, More etc.). Theretail landscape is changing in ways that are placingsignificant pressure on retailers. The intersection of long-termtrends-slow growth in mature markets, shifts in shoppinghabits, the development of new channels-and short-termchallenges caused by the economic recession means thatretailers must scrutinize every aspect of their operations andeliminate the inefficiencies they accumulated during everytimes. The space for this retail outlet is fixed. So the spacemanagement for the product is very important. So I want tomake a study and analyse it to find out the best solution forspace management and inventory control policy for theproduct. I have taken the item-

Therefore the study is on this product to find out the best

Retail Trade - India, US and China

"Fruits”

solution according to space. The products and their demandsare different in nature. Handling perspective of product isdifferent also. Product lifecycle is important.

Right Product, Right Price, Right Place. Achieve salesoptimization with space planning and allocation tools. Theconvergence of space and assortment Planning can help tostrengthen sales across a variety of retailers, helping themovercome traditionally weak sections of store plans. Smartretailers have always known that using "one-size-fits-all"averages to create assortment plans yields only averageresults. Ideally, retailers should treat every store in their chainas if it is the ONLY store in their chain, creating productassortments designed specifically to appeal to that store'scustomers, and making the best use of each store's physicallayout to present those products in the most appealingmanner. The need to "localize" assortments and store layoutshas never been more important than it is today. Consumers areentering stores well informed about products, prices andcompetitive offerings, and increasingly sophisticated mobileapplications give them access to this information while theyare walking the store aisles.Yet retailers also now have accessto more detailed information about their customers, whichthey can use to create customer-centric assortments in theirstores. Space and assortment planning solutions help retailerscreate a compelling, competitive, customer-driven store.Allocation Optimization Localized consumer demand drivescompetition for retailers to optimize allocated assortments.An optimized assortment gives retail managers the power tovisualize their products the way that consumers shop forthem. Through the integration of product clusters into themerchandising and assortment planning processes, localizedpreferences become clear. Merchants can ensure that everyassortment allocation corresponds to the specific sizes,colours, styles or brands that local customers demand. Anideal assortment plan for any fashion retailer stocks the rightsize at the right store. The proper planning tools can generateaccurate size profiles specific to each product and location.Smart retailers are taking advantage of size history to developlocal seasonal size profiles preferences. They also can benefitfrom the ability to identify store groups with similar sizedemands, which leads to improved margins and increasedsales.

A. Preparation of question:

B. Store design layout :

C. Ware house for the items:

D. Channel distribution :

E. Strategy for marketing:

F. Information from different stores:

For operating the store the human resources is most

Scope of Management

Approach

Vol. 9 No. 04 May, 2016

Corporate No of Outlets Remarks

Reliance Retail 700+ Biggest Retail Chain & fastExpanding, operating in 14 States.

Big Bazaar 174 Fast Expanding, Big Size Stores

Bharti - Wal-Mart 10503

Retail Stores in NCR, Punjab, UP &Rajasthan, Expanding quickly to

South Cash & carry Stores

Aditya Birla 579+ Concentration in South(acquiredTrine thra and Fab Malls)

Spencer’s 250 Oldest Retailer in India, operates in27 Cities

Metro-AG- Germany 4 Cash and carry stores located atMumbai, Hyderabad & Kolkata,

Expanding Slowly

EIRC NEWS 17

important. I have observed an asked the head of retail managerabout the human resources utilization for the fruits handling &selling. The structure of that utilization is given belowaccording to store:

For this, I have made another idea which help to be more easyto remove the problems. I have introduced some applicationsof layout designing model. One of the layout designingmodels is taken as best fitted for making the solutions. Thedesign is drawn for best understanding. Though I have visitedfour retail outlet but I have applied the model for the only oneretail outlet. The cause behind this are -

A. Spencer is not playing very important role for the sellingthe fruits. They have no intention to develop this so thefruits & vegetables are taken only as a status symbolcompare to other retail outlet.

B. The design of this retail outlet is quite different. It is hardto identify the area utilization method. They sell thefruits without following any scientific model for thisparticular.

C. The more is making an important role for the sellingfruits. But the data was insufficient to make a facilitydesign. Though, they use the scientific model (designedby the centralized owners) for this.

D. I have visited so many times to big bazar. They are reallyeager to sell the fruits. Though, their design for productdistribution is not effective to increase the sell. They usedifferent kind of fruits throughout the year. So if weapply a best fitted model for this so the sell will increasedue to the new model. I hope the new design approachedby the model help to increase the sell.

So we have focused on Big Bazar, Durgapur. The ground flooris used for the fruits and vegetables and others. There are threedifferent places in the ground floor for selling the fruits. Twoof them are near to each other. But one is away from the fruits& vegetables unit.

Research

The problem of retail store for fruits

The model is 'Center of Gravity’

a. The allocation is different for the fruits. Three places areallocated for fruits.

b. The distance from the entry gate to the fruits unit is along way. The customer will move haphazardly forpurchasing the product.

c. The display of the fruits is different for the differentplaces in the retail stores.

d. The packaging system is different which the cause ofdelay of purchasing time is.

e. The paying system is fixed. So for the case of fruitspurchaser, the time is more for traveling.

f. The length of the line is more in time of paying bill.

g. No special care for the seasonal product in time of offerperiod or in rush hour.

So we have chosen the big bazar for the betterimplementation of the layout model. Though, there aredifferent kinds of model for the layout design, but I havetaken only one layout model to fit here.

I have drawn the layout of retail outlet for the betterunderstanding and application of the model in the retailstores.

Delay time is directly proportional to both distance andfruits unit location in retail store.

Ideal location is which minimizes the weighted distancebetween the entry gate and its actual position in retailoutlet.

The distance is weighted by the distance travelled by thecustomers for fruit products only.

The center of gravity method is used to find a locationthat minimizes the Sum of Transportation Cost inbetween new facility and old facilities.

Transportation cost is assumed to be a linear function ofthe Number of Units Shipped & the Traveling Distance.

The locations of the firm's existing facilities areconverted into x and y coordinates.

The following center of gravity equations are Then usedfor calculating the x and y coordinates for the newfacility:

C = X coordinate of center of gravity

C =Ycoordinate of center of gravity

d = x coordinate of location i

d = y coordinate of location i

W = the distance travelled by the customers for fruit

products location i

C = d W / ? W

C = d W / ? W

l

l

l

l

l

l

l

l

l

l

l

l

X

Y

ix

iy

i

X i ix i i

Y i iy i i

Σ

Σ

Vol. 9 No. 04 May, 2016

Corporate Place ofvisit

No. of employeefor the operationof store & selling

of fruits

Person with whommeted to know the

details

Reliance Retail No visit × ×

Big Bazar Durgapur Three ( 3 ) Srijani Roy (HR)

Bharti - Wal-

Mart

No visit × ×

Aditya

Birla(MORE)

Kolkata Four ( 4 ) NiluBhoumik(Store manager)

Spencer’s Durgapur Two ( 2 ) PrioDasgupta(store operations)

Metro-AG-

Germany

Kolkata Ten (10) AlokeshSinha(Retail manager)

EIRC NEWS 18

'Center of Gravity' Method

Explanation

The application of the model for Condition 1:

C = D W / W

= [623*185+ 379* 180+ 385* 180] / (623+379+385)

= [115255+62220+69300]/ 1387

= 246775/1387

= 177.91 =178ft

C = D W / W

= [623*241+ 379* 122+ 385* 128] / (623+379+385)

= [150143+46238+49280]/ 1387

= 245661/1387

= 177.11 =177 ft.

This equation is taken for ideal condition of flow of customermovement.

If the customer is not able to pay on the first counter which isclose to the vegetables & fruits unit (situated on the line ofexit) then, the customer will compel to move the 2 nearestpayment gate to pay & exit. The second exit and payment gatedistance through X axis 125ft.

So the 50 ft. distance will be covered by the customer in idealcondition. It will be nearest to the customer for customertraffic in 1 counter.

C = D W / W

= [673*185+ 429* 180+ 435* 180] / (673+429+435)

= [124505+77220+78300]/ 1537

= 280025/1537

= 182.18 =182ft

C = D W / W

= [673*241+ 429* 122+ 435* 128] / (673+429+435)

X i ix I i

Y i iy i i

X i ix i i

Y i iy i i

Σ Σ

Σ Σ

Σ Σ

Σ Σ

nd

st

= [162193+52338+55680]/ 1537

= 270211/1537

= 175.8042 =176 ft.

So here the model is fitted through the available data. The newdesign is very applicable for this store. The new storedimension will create new dimension for increasing of sellingand the distance covered by the customer will reduce.

So the new design will be 182 ft. in X axis & 176 ft. in Y axisgraphically.

If the customer is not able to pay on the first counter which isclose to the vegetables & fruits unit (situated on the line ofexit) then, the customer will compel to move the 2nd nearestpayment gate to pay & exit. The second exit and payment gatedistance through X axis 110ft.

So the 80 ft. distance will be covered by the customer in idealcondition. It will be nearest to the customer for customertraffic in 1st counter & 2nd counter.

C = D W / W

= [703*185+459* 180+ 465* 180] / (703+459+465)

= [130055+82620+83700]/ 1627

= 296375/1627

= 182.16 =182ft

C = D W / W

= [703*241+459* 122+ 465* 128] / (703+459+465)

= [169423+55998+59520]/ 1627

= 284941/1627

= 175.13 =175 ft.

So for this condition the design will be according to output ofthe fitted model.

So the new design will be 182 ft. in X axis & 175 ft. in Y axisgraphically.

If the customer is not able to pay on the first counter which isclose to the vegetables & fruits unit (situated on the line ofexit) then, the customer will compel to move the 2nd nearestpayment gate to pay & exit. The second exit and payment gatedistance through X axis 95ft.

So the 110 ft. distance will be covered by the customer in idealcondition. It will be nearest to the customer for customertraffic in 1st counter, 2nd counter& 3rd counter.

The application of the model for Condition 2:

The application of the model for Condition 3:

X i ix i i

Y i iy i i

Σ Σ

Σ Σ

Vol. 9 No. 04 May, 2016

Location namein the unit

Distance covered forcompletion the purchasing

product (Fruits)

Xcoordinate

Ycoordinate

A 244+(185-50)+244= 623 ft. 185 ft. 241 ft.

B 30+(185-50)+(122-30)+122=379 ft. 180 ft. 122ft.

C 30+(185-50)+(128-30)+128=385 ft. 180 ft. 128ft.

∑ =1387 ft. CX = 178 ft. CY = 177 ft.

Locationname in the

unit

Distance covered forcompletion the

purchasing product(Fruits)

Xcoordinate

Ycoordinate

A 244+(185-50)+244+50=673 ft. 185 ft. 241 ft.

B 30+(185-50)+(122-30)+122+50=429 ft. 180 ft. 122ft.

C 30+(185-50)+(128-30)+128+50=435 ft. 180 ft. 128ft.

∑ =1537 ft. CX = 182 ft. CY = 176 ft.

Location namein the unit

Distance covered for completionthe purchasing product (Fruits)

Xcoordinate

Ycoordinate

A 244+(185-50)+244+80= 703 ft. 185 ft. 241 ft.

B 30+(185-50)+(122-30)+122+80=459 ft. 180 ft. 122ft.

C 30+(185-50)+(128-30)+128+80=465 ft. 180 ft. 128ft.

∑ =1627 ft. CX = 182 ft. CY = 175 ft.

EIRC NEWS 19

C = D W / W

= [733*185+ 489* 180+ 495* 180] / (623+379+385)

= [135605+88020+89100]/ 1717

= 312725/1717

= 182.135 =182ft

C = D W / W

= [733*241+ 489* 122+ 495* 128] / (623+379+385)

= [176653+59658+63360]/ 1717

= 299671/1717

= 174.532 =175 ft.

So for this condition the design will be according to output ofthe fitted model.

So the new design will be 182 ft. in X axis & 175 ft. in Y axisgraphically.

If we take the average of the output then we get the result (182ft. in X axis & 175 ft. in Y axis). This is the best model for thebetter output. so the new location will be like……….

X i ix i i

Y i iy i i

Σ Σ

Σ Σ

Figure: 1

Figure: 2

Effect of the new design

The new design will be more beneficial for the store.Because, the new design will reduce the time as well astraffic problem in time of rush hour.

The customer will able to see all the fruits item at a place.

The promotion and pricing will be very clear bycomparison of fruits.

It is also helpful to worker for loading and unloading theitem from the place to the ware house also.

The new suggested place is (X axis 182 ft. & Y axis 175ft.). The new suggested place will be bear to the exit gate.So the less interested buyer will leave from that gateafter the observation.

The human resources will be less due to the singledisplay unit and selling unit of fruits.

This will reduce operation cost to take care the fruits.

The exit door can be facilitated with a cash collectioncentre. So the customer traffic will be less for the fruitsunit.

RFID technology can be used here due to single unit inplace of three different existing units of fruits. It willreduce the cost for calculation the product amount.

It is very helpful to promote the product and makeloyalty through the less time consumption for buyingfruits.

Now a day the customers are very busy and they move

l

l

l

l

l

l

l

l

l

l

l

Vol. 9 No. 04 May, 2016

Location namein the unit

Distance covered for completionthe purchasing product (Fruits)

Xcoordinate

Ycoordinate

A 244+(185-50)+244+110= 733 ft. 185 ft. 241 ft.

B 30+(185-50)+(122-30)+122+110=489 ft. 180 ft. 122ft.

C 30+(185-50)+(128-30)+128+110=495 ft. 180 ft. 128ft.

∑ =1717 ft. CX = 182 ft. CY = 175ft.

EIRC NEWS 20

the retail outlet to mitigate the requirement only. Fruitsare not fashionable goods. So the customers decide itfrom home to buy the fruits & vegetables from the retailoutlet. So time delay may make a big effect for theexisting design. So the new design will be very

Some retail outlets have some strategy to gathercustomer in retail outlets. But the most retailers do notstudy on the purchasing behaviour of the customer forfruits. So if the single place is provided for the fruits thenthe observation will be easier to the retail manager.

According to my study on the retail outlet for fruits thereis no available data for the selling amount daily basis. It ishard to keep the data for daily selling basis. So thepurchase managers of the retail outlet face the problemsometime. If the store is in a single position then the datacollection will be easier.

¢ The weighing machine is a factor for the three units.Customers are liable for carrying the fruits for weightand packaging after sorting. So single place can bemaintained by one weighing machine. So the customercan wait for the process. It is helpful to customer.

l

l

l

Concluding Observations

The scope is limited to me. I have studied on different retailoutlets. I have limited time and scope to solve the problem.The store is already designed by the owner of the retail stores.Though, consumer behaviour pattern in India is different forthe fruits and vegetables. The study for the different store isdifferent due to design, store operations, pricing strategy,facility lay out design, perception about the customer forgeographical variations. So it is difficult to give suggestionabout the layout and their strategy.

I have studied the importance of Facility layoutprogramme. I am able to solve the facility layoutproblem in future for this type of case through the modelwhich is used here.

The purchasing amount is described, but due to lack ofconsumption amount data, the forecasting of demandwas not possible. Most of the operation manager of retailoutlet gives the average order. So it is a scope to us tostudy on average demand analysis for the forecasting ofdemand. It helps more the retail outlet. The research andmodel is very precious for the forecasting of demand incase of seasonal products.

l

l

Vol. 9 No. 04 May, 2016

STUDENT’S SECTION

EIRC NEWS 21

Test

You

r Kno

wle

dge

!!Quiz Master PageCMA Ajay Deep Wadhwa, Former Chairman, EIRC of ICAI

Answers:

Vol. 9 No. 04 May, 2016

1.BajajAuto

2.E-commerce

3.Mr.NaushadForbes

4.Itisfinancialinstrumentheldbyathirdpartyonbehalfoftheothertwopartiesinatransaction.

5.W.ChanKimandReneeMauborgne

6.ThePrimeMinisterofIndia

7.Rs.1,70,000.00crores

8.EquatedMonthlyInstallments

9.TheManagementAccountant

10.JusticeM.B.Shah

1. By which name do we know the very old firm “Bachraj and Co.” now days?

2. In which field, the Government of India has allowed 100% FDI recently?

3. Who is the new President of CII?

4. Explain Escrow Account.

5. Who were the founders of “Blue Ocean Strategy”?

6. Who is the chair person of Niti Aayog?

7. How much money the Central Government has allocated for Government sector Banks, to be spent I next fouryears?

8. Expand “EMI”.

9. What is the name of the official magazine of the Institute of Cost Accountants of India?

10. Who is presently heading the special task force on black money?

EIRC NEWS 22

Vol. 9 No. 04 May, 2016

Chapter Activities

Bhubaneswar Chapter of CostAccountants

Implementation of INDAS

Service Taxes Rules and its Extension to GST

InternalAudit in Power Sectors

CostAccounting Standards and CostAuditing Standards and its implementation

Insurance Sectors & ProfessionalAvenues

The Institute of Cost Accountants of India -Bhubaneswar Chapter has organized one day Seminar on "Role of Professionals in theChanging Global Scenario" on 15th May, 2016(Sunday) at its Conference Hall.

The deliberations held on the following contemporary topics:

CMA Mrityunjay Acharya, Sr. Vice President, Balmer Lawrie & Co. Ltd., Kolkata delivered in detail about various accountingstandards in detailed with lot of examples & implementation of INDAS.

CMA Niranjan Swain, Sr. General Manager (Finance), OPGC Ltd., Bhubaneswar & Past Chairman, EIRC of ICAI, Kolkatadelivered in detailed reading service tax rules ,its implementation & extension to GST.

CMA Srikanta Kumar Sahoo, Deputy General Manager(Finance), GRIDCO Ltd., Bhubaneswar & Past Chairman, EIRC of ICAI,Kolkata discussed in detailed on various practical aspects and provisions for InternalAudit in Power Sectors.

CMA Niranjan Mishra, Council Member, Chairman, Regional Councils & Chapters Coordination Committee, Member (CostAuditing & Accounting Standards Board) ICAI, Kolkata addressed in detailed about the provisions, applicability, importance andimplementation of CostAuditing & CostAccounting Standard Boards.

CMA Shiba Prasad Padhi, Chairman, EIRC of ICAI, Kolkata & One of the reputed Insurance Surveyors at Odisha highlighted indetail about the importance & avenues of Professionals in Insurance Sectors.

CMA Jagatjyoti Biswaranjan Nayak, Secretary of the Chapter facilitated the entire seminar and extended formal vote of thanksduring pre - lunch session. CMA Damodar Mishra, Chairman, Professional Development Committee of the Chapter deliveredwelcome address and extended formal vote of thanks. CMA Bibhuti Bhusan Nayak, Chairman of the Chapter delivered key noteaddress.

NEWS

On 17 April 2016 Members Meet was organized by EIRC at EIRC Auditorium. The details of activities undertaken by the EIRCwere discussed & the future action plan was also presented before the members. The Members meet was very interactive &suggestions of members were also noted.

CEP on “Enhancing Organizational Capabilities – Caselet Approach” was organized by EIRC on 18 April 2016 at EIRCAuditorium. CMAT.C.A.Srinivasa Prasad, Former, ED, SAILwas the Speaker.

CEP on “Cost Competitiveness in SME Sector” was organized by EIRC on 26 April 2016 at EIRC Auditorium. CMA (Dr)D.P.Nandy, Director, Research & Journal, ICAI was the Speaker.

CEP on “Union Budget – 2016 and Applicable Provisions for Service Tax, Excise & Customs” on 4 May 2016 was organized byEIRC at EIRC Auditorium. CMA Mrityunjay Acharjee, Sr Vice President, Balmer Larwie & Co. Ltd & CMAAbhijit Khasnobis,Practicing CostAccountant were the Speakers on the occasion.

CEP on Commodities & Derivatives market” was organized by EIRC on 9 May 2016 at EIRC Auditorium.

th

th

th

th

thMr. Vibhor Tandon –

Assistant Vice President (AVP) -Multi Commodity Exchange of India Ltd & Mr. Diptendu Moulik – Senior Executive - MultiCommodity Exchange of India Ltd were the speakers.

EIRC Activities

PWC Interview organized by EIRC on 13 May 2016.th A Cross Section of Qualified Students - PWC Interview.

CMA Shiba Prasad Padhi, Chairman, EIRC of ICAI, Kolkata addressing on the topic “Insurance Sectors & Professional Avenues” on the occasion One Day Seminar on“Role of Professionals in the Changing Global Scenario”organized by the Bhubaneswar Chapter on 15.05.16. (L/R) CMA Damodar Mishra, Chairman,

Professional Development Committee of the Chapter ,CMA Srikanta Kumar Sahoo, Past Chairman, EIRC of ICAI, Kolkata,CMA Bibhuti Bhusan Nayak, Chairman of the Chapter,CMA Niranjan Mishra, Council Member, Chairman, Regional Councils and Chapters Coordination Committee,Member Cost Auditing & Accounting Standards Board, ICAI, Kolkata

CEP on Commodities & Derivatives market” organized by EIRC on 9 May 2016 at EIRC Auditorium. (L/R) Mr. Diptendu Moulik – Senior Executive - Multi Commodity Exchange of IndiaLtd & Mr. Vibhor Tandon – Assistant Vice President (AVP) - Multi Commodity Exchange of India Ltd. CMA Bibekananda Mukhopadhyay, Vice Chairman, EIRC addressing.

th

Printed & published by CMA Shiba Prasad Padhi on behalf of owner EIRC of ICAI, printed at Moodran Graphica,41, Gokul Boral Street, Kolkata - 700 012. Published at 84, Harish Mukherjee Road, Kolkata - 700 025.

Editor’s name : CMA Arundhati Basu

RNI No. WBENG/2008/24583

Publication Date : May 2016

Book

Post

G

R

O

O

M

I

N

G

P

R

O

F

E

S

S

I

O

N

A

L

C

M

A

S

Eastern India Regional CouncilThe Institute of Cost Accountants of India (EIRC of ICAI)

[Statutory Body under an Act of Parliament]

CMA Bhawan, 84, Harish Mukherjee Road, Kolkata- 700 025

Telephones: (033) 2455-3418/5957/6666/9999, 6456 3600-03; 6450 4305

Fax: +91-33-2455-7920 e-mail: eirc@icmai.in Website : www.eircoficwai.com

About EIRC of ICAI

24 Chapters located at different places

8000 members

Excellent Campus Placement

?

?

?

? Reputed & Experienced Faculties

About the course

Full time Course

Suits Working Executives

Choice of Class Room Learning / Distance Learning

Can be pursued along with other courses

?

?

?

?

Admission

OpenAdmission

OpenAdmission

Open

Admission

Open

STRATEGY ----- MANAGEMENT ---- FINANCIAL REPORTS ----- REGULATORY

Role of CMAs

Introducing Cost Competitiveness

Resource Management

Performance Management

Financial Report & Strategy

Cost Audit & Assurance

Risk Management & Mitigation

Direct & Indirect Taxation

?

?

?

?

?

?

?

Come & Join today

To reach new height in your careerBe a Qualified Cost & Management Accountant