Venture Engine Offers Real Opportunity to Sri Lankan Entrepreneurs by Creating a Platform to Pitch Their Ideas to Potential Investors

01st March 2012, , www.ft.lk

Venture Engine, a project aimed at creating ‘real opportunity’ for Sri Lankan entrepreneurs and providing a boost to the country’s emerging economy by promoting and supporting entrepreneurial spirit, was launched yesterday.

“With the economy set to grow, the time is now to foster entrepreneurship,” declared Blue Ocean Ventures Ltd. Managing Director Prajeeth Balasubramaniam yesterday.

The project, conceptualised by Blue Ocean Ventures and the Indian Angel Network with the participation of Dialog Axiata PLC and Expolanka Holdings, creates a platform for entrepreneurs to pitch their ideas directly to potential investors while receiving comprehensive mentoring.

Said to be the first of its kind in Sri Lanka, the project is modelled on the Indian Angel Network, India’s first, and Asia’s largest, business angel network. The Indian Angel Network invested Rs. 1 billion in India last year, and brings budding entrepreneurs together with nearly 200 successful entrepreneurs and CEOs. “We don’t have enough of anything,” he claimed.

Dialog Axiata Group CEO Dr. Hans Wijayasuriya, citing Dialog’s small beginnings and Sri Lanka’s lack of a  “next step” between entrepreneurs who have good ideas and investors, stated: “Behind the future of seed investment, Dialog will help in whatever way.”

Expolanka Group CEO Hanif Yusoof added: “I am pleased that the journey has begun.”

According to Blue Ocean Ventures Chairman Rajan Anandan, Venture Engine is looking to assist not only entrepreneurs who have an idea and require seed capital and mentoring support, but also existing start-ups that require capital and advice for expansion.

Indian Angel Network President Padmaja Ruparel stated that the ‘Angel Investors’ would invest their time, networks and money. They will mentor entrepreneurs as well as open up clients and opportunities, she said.
Benefits to participants include access to mentoring and the opportunity to pitch business concepts and tie up with leading entrepreneurs and venture capitalists. The program also offers media exposure to all selected participants and start-up gifts to the top three places.

As of 1 March, an ‘open call’ has been made for entrepreneurs to submit applications for the program, with a submission deadline of 7 May. Applications must include a business summary, venture stage, required investment, value proposition, sales strategy, competitive analysis and risk strategy.

Thereafter, a panel of leading Sri Lankan and Indian businessmen, entrepreneurs, and investors will whittle the candidates down to 10. On 29 May, the 10 candidates will present their proposals and the field will again be cut down, this time to five. The five remaining candidates will have access to workshop sessions and will work towards the finale on 20 June, where the top three candidates will receive their start-up gifts.
The entrepreneurs’ ideas will be judged on uniqueness, marketability, the service offered and the financial forecast. The entrepreneurs will be judged on selling skills, self motivation, attitude, flexibility and willingness to take risk.

However, according to Ruparel, Venture Engine should not be thought of as a “business competition,” but as a platform for “cultivating the entrepreneur”. She went on to say that the biggest value created would be the “entrepreneurial spirit”.

Balasubramaniam echoed this sentiment, claiming that the “cash prizes are insignificant in the overall picture,” and that while the top 10 will have access to the business angels in India and Sri Lanka, if an investor liked the 20th application, then the investor could pursue that project.

As participating investors will be taking significant risk, they will acquire a stake in the companies. Citing an illiquid market in Sri Lanka, Anandan foresaw only a few methods for investors to withdraw their money from successful companies, including a strategic acquisition by another company, a buyout by the entrepreneurs or a buyout by other venture capitalists. The panel stated that investors engaging with entrepreneurs would not take a majority stake or seek to control the companies.

“Hopefully in the next few years we will see a transformation in how start-ups and entrepreneurs are viewed,” noted Anandan, adding that there were lots of opportunities out there.

Image: Blue Ocean Ventures Managing Director Prajeeth Balasubramaniam (second from right) briefs journalists yesterday. Others from left are Blue Ocean Ventures Chairman Rajan Anandan, Indian Angel Network Board Member Sunil Kalra, Expolanka Group CEO Hanif Yusoof, Dialog Axiata Group CEO Dr. Hans Wijayasuriya and Indian Angel Network President Padmaja Ruparel. Pic by Kithsiri de Mel.

Laugfs & Sri Lanka Institute of Nanotechnology to Process Mineral Sands for Value Addition

02nd March 2012, www.dailynews.lk,

Laugfs Holdings Limited entered into a strategic agreement with Sri Lanka Institute of Nanotechnology (SLINTEC) to process natural mineral sands for value addition.

The landmark agreement was signed yesterday creating a PPP venture to set up country’s first ever plant to produce titanium dioxide from mineral sand.

The agreement will be an initiative to bring in more foreign exchange in to the country where at present mineral sand is exported in raw form in bulk. The country imports processed sand paying 10 to 15 percent more in value thus making the industry a negative contributor to the economy. Our efforts will reverse this trend, Laugfs Holdings Chairman W.K.H. Wegapitiya said.

“Sri Lankan entrepreneurs and companies should be encouraged to venture into similar businesses leading to value addition. Although, we believe that FDI is key for economic development, it has not made significant impact on the economy. Therefore entrepreneurs with new thinking to take maximum advantage of our natural resources to engage in scientific research are the need of the hour,” he said. The country is rich with key ingredients of natural resources as factors of production, location specific advantages and entrepreneurship which according to Michael Porter are the pre-requisites of economic development.

We are rich with all three factors and also possess knowledge but not have reached the developed nation status. This is a concern and need corrective action. “We are a truly Sri Lankan company and this venture is going beyond commercial consideration to give back to society.


We are creating synergy with the agreement which could lead to new knowledge and confident that the country will benefit in the long run,” Wegapitiya said.

A fully fledged manufacturing plant will be set up shortly to produce different value added chemical from mineral sand.

Sri Lanka is estimated to have 18 million metric tons of ilmenite reserves, the world’s ninth largest deposit.

The country’s North and the East beach sands contained about 70 to 72 percent ilmenite and it is estimated to have 6 to 8 million metric tons of ilmenite according to the surveys of the Geological Survey and Mines Bureau of Sri Lanka.

Pulmoddai ilmenite is known to contain about 50 to 60 percent of titanium dioxide in its composition.

The SLINTEC has developed a proprietary process to produce TiO2 and nano TiO2 starting with ilmenite obtained from Pulmoddai. Signing of this agreement will initiate the commissioning of a pilot plant and then a large scale commercial plant where the project will be completed in three phases.

Image: Laugfs Holdings Chairman W.K.H. Wegapitiya, Senior Minister Tissa Vitarana and SLINTEC
and other officials at the tie up. Picture by Nissanka Wijeratne

Related Info :

• Sri Lanka Institute of Nanotechnology to be a Research and Innovation platform for Sustainable Nanotechnology in Asia

• Sri Lanka to Manufacture Nano Titanium Dioxide from Pulmoddai Mineral Sands

Thai AirAsia, Low Fare Airline, Flies to Sri Lanka

02nd March 2012, www.dailynews.lk, By Shirajiv Sirimane

AirAsia, the World’s best Low-Cost Airline, celebrates their inaugural flights from Colombo to Bangkok yesterday.

Tassapon Bijleveld, CEO of Thai AirAsia, “We are very excited to open up a world of opportunities for people to shop, sight-see, and experience all the flavors that Thailand has to offer, at a very affordable price. “Since tickets for this route went on sale on 4 January 2012, we have received tremendous positive feedback and we are very pleased to see that there is much demand for travel between the two cities”.

He said that they are currently operating on a 70% load factor and this would increase to 80% soon.

“As a low-cost carrier to fly to Sri Lanka, AirAsia is committed to offering the best fares on our brand-new Airbus A320 planes”. Bijleveld also believes that this new route will bring in a surge of visitors and business people from Thailand which will significantly stimulate Sri-Lanka’s travel industry. “Many Thai Buddhists love to visit Sri Lanka’s temples and religious sites during their Buddhist pilgrimage. We look forward to promoting such a beautiful destination along with the country’s UNESCO World Heritage sites”, said the CEO.

Currently around 50, 000 Sri Lankans travel to Thailand and only 5,000 fly from Thailand to Sri Lanka. “With AirAsia this gap would narrow,” he said.

Asked why they were late to include Colombo to their radar he said that it was because they first wanted to concentrate on domestic, China and India.

On the other hand, Bangkok’s temples, colorful night life, and mouth-watering cuisine is now within everyone’s reach and budget, thanks to AirAsia’s daily flights. The 180-seat Airbus A320 has leather seats and a variety of in-flight meals to choose from.

Apart from Bangkok, AirAsia’s connectivity extends to other destinations in Thailand that passengers can easily connect to from Bangkok including world-famous beach destinations such as Phuket or the charming city of Chiang Mai in northern Thailand. Thai AirAsia currently flies to 12 destinations within Thailand and 16 international destinations from Bangkok including Singapore, Bali, Hong Kong, Macau, Guangzhou, Shenzen, Phnom Penh, Ho Chi Minh, Hanoi, Chennai, Chongqing, Colombo, Kolkata, Yangon, Penang and Kuala Lumpur.

AirAsia, the leading and largest low-cost carrier in Asia, services the most extensive network with approximately 139 routes. Within 10 years of operations, AirAsia has carried over 100 million guests and grown its fleet from just two aircraft to approximately 106.

The airline today is proud to be a truly ASEAN (Association of Southeast Asian Nations) airline with established operations based in Malaysia, Indonesia, Thailand and Philippines servicing a network stretching across all ASEAN countries, China, India, Sri Lanka and Australia.

Japan Ups Sri Lanka Auto Market Share with Hybrids. India's Share Down to 45pct. China Third with 5pct

01st March 2012, www.lankabusinessonline.com

Japan has increased its share in Sri Lanka's auto market to 36 percent from 33 percent in value with a surge in hybrid vehicles, amid a boom coming after a cut in taxes, Sri Lanka's main business chamber said.

The Ceylon Chamber of Commerce said in an analysis of the auto market that market leader India's share has in terms of value had fallen to 45 percent to 51 percent. China was third with 5.0 percent.

The value of imports had increased to 219 billion rupees from 117 billion rupees.

The CCC said 57,886 cars and were registered in 2011 up 11 percent while 525,421 vehicles of all types were registered in 2011, up 32 percent from a year earlier including over 250,000 motor cycles.

In 2011, 5,927 hybrid vehicles were imported up from 438. "This growth momentum is likely to continue with the increase in fuel prices," the Ceylon Chamber of Commerce said.

"Japan is the leading supplier of hybrid vehicles into Sri Lanka in almost all categories of vehicles except for cars of cylinder capacity exceeding 2000 cc (cubic centimeters), where Germany is the main supplier."

Transport between 5 to 20 tonnes have risen over 10 fold to 48,384 to 4,359. India supplied 91 percent of the total followed by Japan at 15 percent.

The Chamber said motor cars of less than 1,000 cc engine capacity had grown 222 percent partly helped by Tata Nano cars.

More than 100,000 petrol driven three wheelers have been imported in 2011. Diesel three wheeler lagged are there are only 20,000 in the country. The chamber said 99 percent came from India.

Sri Lanka’s NTB Bank & Remit2Home Money Transferring Service Cater to Sri Lankans in US & UK

29th February 2012, www.news360.lk

Sri Lanka’s Nations Trust Bank has tied up with Remit2Home, an Online Global Money Transferring service provider, in a bid to cater to the non resident Sri Lankans living in US and UK.

NTB says, the tie up will help the Sri Lankan community living in those two countries to transfer money online directly from their bank account abroad to beneficiaries here in the country.

An agreement with effect to the partnership was signed recently in Colombo between Nations Trust Bank and Times of Money, which owns Remit2Home.

“This partnership is another milestone in providing a convenient and fast remittance service through a globally recognized brand to anyone in Sri Lanka through the Nations Trust Banking network”, added Saliya Rajakaruna, CEO of the NTB.

“With its growing Diaspora, Sri Lanka has a huge remittance potential, which makes it a key focus market for us” said Avijit Nanda, President – TimesofMoney, expressing his views on the partnership.

A statement from NTB describes Times of Money service as the pioneers in e-payments and cross border remittances, serving over a million expatriates worldwide.

Sri Lanka during the year 2011, received over US$ 5 billion worth of worker remittances, a record figure in the Islands history.

Related Info :
• Sampath Bank Launches M2SL Money2SriLanka Online Money Transfer Facility with ICICI Bank of India

There is No Capital Flight from Sri Lanka - Central Bank. IMF Deal to be Resumed

01st March 2012, www.lankabusinessonline.com

Sri Lanka is planning to resume a deal with the International Monetary Fund which can boost the island's forex reserves which had fallen to 5.7 billion US dollars and there is no capital flight, the Central Bank said.

There has been a net inflow of 216 million US dollars into government securities from foreign investors from February 09 when the rupee was partially floated, and corrective steps were taken to reign in credit growth which put pressure on a dollar peg, the Central Bank said.

According to Central Bank data foreign investors held 212 billion rupees of bonds up from 199 billion rupees on January 04. Treasury bills holdings rose to 84.5 billion rupees from 70.1 billion rupees in the same period there amid periodic changes.

The International Monetary Fund held back the last 800 million dollar tranche under a stand by arrangement reached in May 2009, at the end of the island's previous balance of payment crisis.

"Meanwhile, the IMF-SBA (stand by arrangement) programme is progressing with plans of completing the 7th review towards the end of March 2012," the Central Bank said in a statement.

The IMF suspended its disbursements in mid 2011 asking the Central Bank to loosen a peg with the US dollar which underlying monetary policy no longer supported.

The resumption of the program could infuse two 400 million dollar tranches into the Central Bank's forex reserves which was now down to 5.7 billion US dollars. Reserves peaked at 8.1 billion US dollars in July just as credit growth picked up.

The Central Bank said foreign direct investments are projected to top a billion US dollars in 2012, which can boost reserves.

However FDIs are usually spent, resulting in imports. To increase foreign reserves absolutely, the monetary authority has reign in credit growth and start mopping up rupees from the banking system and contract central bank credit.

Sri Lanka's rupee peg came under pressure due to high credit growth including from loans taken by state enterprises to run large losses from mid 2011.

But from September, Central Bank credit started to ratchet up as it offset (sterilize) the contractionary effect of forex market interventions with expansionary rupee injections into money markets.

A clean float can break a cycle of sterilized intervention end central bank credit expansion.

Related Info :

• Sri Lanka's Economy to Grow at 8pct in 2012 with a New Deal with IMF

• IMF Appoints Sharmini Coorey, a Sri Lankan, to Head the New Department Formed for Capacity Building of Member States. Ms Coorey Currently Functions as the Director of IMF Institute

Fitch & Standard & Poor’s Warn Sri Lanka on Its Weak External Position and the Risk to Sovereign Credit Rating

01st March 2012, www.ft.lk

Fitch and Standard & Poor’s rating agencies yesterday warned Sri Lanka that its sovereign credit rating was at risk due to the country’s weak external position and the depletion of its foreign currency reserves to protect the rupee exchange rate.

The country’s Central Bank, which is under a $ 2.6 billion International Monetary Fund (IMF) loan programme, for months last year disregarded the global lender’s warning that the policy of defending the rupee was unsustainable.


The monetary authority blew through more than $ 2.7 billion in the second half of last year staving off depreciation pressure, cutting its forex reserves by a third. At the same time, rising oil prices produced a record trade gap.

Fitch in a special report said the sharp drop in reserves in the second half of 2011 has increased the risks on the sustainability of the country’s balance-of-payments.

Going a step further, S&P revised down the country’s sovereign rating outlook to stable from positive due to the external imbalances stemming from a decline in the reserves. “We revised our outlook on the long-term foreign currency rating to reflect the country’s deteriorating external liquidity,” S&P Credit Analyst Takahira Ogawa said.

S&P said it may lower the rating if there is “substantial further deterioration” of external liquidity or if Sri Lanka’s growth and revenue prospects fall below expectations.
“Recent policy developments are encouraging as they indicate the authorities are seeking an adjustment in the current account that could place the balance-of-payments on a more sustainable footing,” Fitch Sovereign Team Director Philip McNicholas said in a statement.

Retaining investor confidence in the policy framework will be especially important to ward off the risk of capital flight, and thus adhering to policies aimed at delivering a sustainable balance of payments, even at the cost of slightly slower growth, would support the current ratings, Fitch said.

Related Info :

• Large Sri Lanka Firms Strong Enough. New capital Expenditure Commitments to Slow Down in South Asia Except for Sri Lanka - Standard & Poor's

• Fitch and Moody's Upgrade Sri Lanka's Sovereign Rating due to Key Factors