>>this week on world business... >>shopping opens up in india as the government considers letting retail giants like wal-mart tesco and carrefour into the country. >>the landscape is huge - it's about 400 billion dollars of consumer space out here. >>staying ahead in a competitive and rapidly expanding neighbourhood - indonesia is on the hunt for investment it is a growing population. it's a fantastic opportunity for a business like ours. >>as road traffic increases especially in emerging markets like india so does the problem of pollution, but now new technology from italy could mean cleaner air for everyone... >>the dangerous particles are the nano-particles below one micron and of this 99.8

percent are takenout. >>hello and welcome. i'm raya abirached and this is world business, your weekly insight into the global business trends shaping our lives. with 1.2 billion people india represents a huge opportunity for retail firms, but the market has long remained closed to big international brands, but now that could be starting to change. >>reporter: the north indian city of chandigarh is now home to a very american brand. foreign multi-brand retailers can't sell directly to consumers in india,

but they can run wholesale operations and provide back-end support to indian retailers, as wal-mart does in a joint venture with bharti enterprises. it plans to multiply its network from two wholesale stores to 15 by the end of next year. >>jain: with a billion people and an economy growing at over 8 percent, where is there a market like india which is still to be tapped? especially when it comes to an industry like retailing or a service style retailing, which is completely at its very beginning in india from an organized perspective. the landscape is huge - it's about 400 billion dollars worth of consumer space out here. >>reporter: owners of neighbourhood stores, or kiranas, strongly oppose foreign investment, fearingthey cannot compete with wal-mart and its rivals like carrefour. >>reporter: foreign investment in retail is a politically sensitive issue in india. fears that foreign retailers

will rob kirana stores and pushcart vendors of their livelihoods and even gobble up local retail players have meant that there's little political will to tackle the issue. >>khandelwal: these big foreign retailers will come in and like they did in australia, the uk and usa, they will try to attract customers with predatory pricing. today 80 percent of these markets arein their hands...they have the financial muscle to sell products below their cost. >>reporter: in fact 65 percent of wal-mart's sales are to kiranas, who buy at wholesale rates here to resell to their own customers, making a case that retail giants actually benefit the smaller stores. >>jain: some of these fears are exaggerated because a lot of rural and semi-rural kiranas are not going to be impacted. in fact, there is a lot of strong evidence to suggest that by the cash and carry operations we're doing, we're actually helping these kiranas to compete

with organized domestic retailers. >>reporter: india is the world's second largest producer of fruits and vegetables, but 40 percent rot on the way to market due to the lack of cold chain facilities. foreign investment in retail couldmake the difference, providing infrastructure india sorely needs. wal-mart already provides this inits chandigarh store, and does good business with local hotels and restaurants. >>ahuja: the biggest advantage is our customers are satisfied. they can see the quality of ingredients we buy from here, plus the meat here is hygienic. if we buy it from our local market the qualityand packaging is inferior. here it is cleaner and cheaper. >>reporter: the indian government is contemplating allowing fdi in multi-brand retail in a cautious attempt to further open up the economy, while protecting the interests of kirana stores. but with plenty of large domestic retailers some analysts believe this caution is unnecessary.

>>singhal: unfortunately the debate has turned out to be foreign retailing versus indian retailing,as compared to large versus small. so for example...very very large successful indian business enterprises are running very very large retail businesses in india, and if large was bad for small, thenit doesn't matter whether the investors are from india or overseas. >>reporter: in fact, the competition is largely expected between existing established indian retailers and foreign players who have expertise but need to learn the indian market. >>reporter: shoppers stop is one of india's leading department store chains, with an annual growth rate of over 25 percent. >>nagesh: fdi or no fdi...its all about how you connect with your consumer. we're not actually too worried about the foreign players coming into the department store business, because there the scaledoesn't make so much of a difference as you don't buy in scale, you are in niches and everything you have to deliver is local: the property is local, the people are local, and 90 percent of the time the sources are local. >>reporter: and local

employment may also be key - foreign retail chains could be forced to reservehalf their jobs for rural youth, and limited top opening in towns with a population bigger than onemillion. restrictions some consider impractical, say analysts. >>singhal: retail is one sector that can absorb individuals with very minimal amount of education, and we have a huge deficit when it comes to educating our population. retail can certainly improve the productivity of farmers, simply because large retail put up large quantum of shelf space, and thelast thing they'd want is the shelf space to go empty. >>reporter: the organized segment is expected to see annual revenues grow from 20 billion dollars now to 75 billion by 2015, irrespective of the entry of foreign retailers. >>but for retail to really take off, foreign investment is key. and that's the reason why large indian retailers like shoppers stop are supporting the entry of foreign players.

>>nagesh: more people coming in, more international players coming in, foreign direct investment inthe business would definitely add up to investment and give you a return, but the return would be in the 5-10-15 year period, and not that if you open today, tomorrow money will come in, and day after you will see the benefit. >>reporter: for those international retailers with a long-term outlook, the indian market is irresistible. but for the doors to open they will need the indian government to be open to the possibilityof an entirely new retail landscape... >>indonesia is blessed with vast and varied reserves of natural resources, and a big and increasingly affluent population - strong draws for foreign investors. but indonesia is also in a highly competitive neighbourhood. so it's working hard to market itself internationally to make sure it's prominently on the radar of the world's investors.

>>reporter: at this year's world economic forum on east asia in vietnam, business leaders were eager to meet and listen to the investment chief of indonesia...a country that many believe is poised for big things. >>wirjawan: indonesia has, i think, think to build certain brand equity. and that brand equity is what indonesia has lacked. >>reporter: gita wirjawan and his team are aiming to fix that. >>from ho chi minh city, wirjawan flew to shanghai to attend a forum and face-to-face talks with chinese business people alongside the leaders of some of indonesia's most dynamic provinces. >>maelzer: indonesia managed to attract some 10 and a half billion dollars of fdi last year despitethe global slowdown. it's aiming to see that amount increase by some 15 per cent this year. and given the amount of foreign direct investment committed so far in 2010 it looks well on track to easily

exceed that target. >>reporter: indonesia's economy grew an impressive four and a half per cent last year, driven by the consumer spending of 240 million people ...one of the country's big selling points. >>swiss food giant nestle has spent 100 million dollars to boost production in east java at what is now one of its 10 biggest factories in the world. >>chaudhry: as the population is large, is a growing population, it's a fantastic opportunity for a business like ours and with that we have been able to see that the categories like milk has a tremendous potential. today the per capita consumption of milk in indonesia is still very low and this has a very big upside potential. >>reporter: to provide its milk needs, the company has built up a network of 33,000 small- scale farmers grouped together

in cooperatives in east java. >>aside from its large and increasingly affluent population, the other key attraction is its vast wealth of natural resources including oil and gas, palm oil, coal and an array of other minerals. >>reporter: but investment in those industries is being hampered by poor infrastructure...the number one complaint of business people these days. >>ichsan: we need more toll roads, we need more electric power generators, we need more modernization of our harbours. because without such infrastructure then it's very difficult to imagine privateinvestment to accelerate very fast. >>reporter: the government is earmarking 50 billion dollars for infrastructure development over thenext five years....and is looking to attract double that from private investors. >>uae-owned mec holdings has secured land in kalimantan in indonesian borneo to extract coal. to bring it

to market efficiently, it's set to build a 136-kilometre railway. >>most of the coal will go to power hungry india and china...and coal is just the start. >>koneru: the rail, the coal mine, the port is concerned, it's a billion dollars of investment. the second phase comes the aluminium smelter which is about four billon dollars of investment, which is the power plant of 1,400 megawatts and 500,000 tons aluminium smelter. and then we'll have the third which we'll have agricultural commodities, where we're still working on the feasibility and the numbers on what the total investment is going to be. >>reporter: to undertake the project, mec had to work its way through multiple layers of indonesianbureaucracy from the central government down to the local level, another impediment to potential investment. >>to try to untangle the red tape, the investment board has set up a one-stop shop system for business approvals.

>>wirjawan: we were able to get 15 ministerial signoffs and that has been in implementation in indonesia, in jakarta, and now we're able to issue a license within five hours, the longest is seven days unlike four or five months that were needed in previous times. the challenge is how do we emulateand duplicate that. we have set the target of replicating that in 33 provinces by the end of the year. >>reporter: investors say they are noting a change in the government's approach. >>chaudary: today you can access the government -- different authorities -- to actually discuss about your issues and you find them extremely focused on the fact that they want to attract, they want to facilitate investment to the country. >>reporter: improvements in fiscal and economic management are also being noted...and rewarded, with upgrades to indonesia's credit rating. >>and while the country looks set for around six per cent growth this year, it can

and should aim higher. >>armas: we expect it to continue accelerating in 2011 and 2012 but i think it's still far away from the growth recently you've seen in china or india and it could get there. but it needs to addresssome of the key areas that we have discussed: infrastructure, investment climate, coordination at the government level. >>reporter: the country's investment chief publicly acknowledges the challenges...but says his teamis determined to help clear away the remaining obstacles to elevate indonesia to the top ranks of investment destinations. >>still to come on world business... >>we check out the dangerous, but exciting sport of motocross but first the new technology that could drastically cut pollution in cars and trucks across the developing world.

>>reporter: for cities in the west the air looks cleaner now thanks to tougher environmental regulations. old vehicles belching out sooty fumes are a thing of the past. car engines use cleaner fuel and pollute less. >>reporter: but looks are deceiving. the air appears cleaner and smells better, but extensive research shows that microscopic or nano-particles mainly from diesel vehicles still kills. in the us alone this type of air pollution contributes to over 1,000 deaths a year. >>mayer: all the vehicles which we have today on the roads are emitting large number of ultra-fine particles which you cannot see, so you believe the exhaust is clean because it's not smoking anymorebut these are the dangerous particles, the fine particles which enter the lungs and create all these health effects. >>reporter: while vehicle ownership is soaring in emerging economies -- in the west vehicles are getting bigger. this is reducing the effectiveness of stricter regulation -- it's also impacting global health.

>>provera: european commission has said that in europe where the levels of emissions are much lowerthan in india or china there are 350,000 people per year who die one year in advance because of airpollution. >>reporter: just spending a day in rome, you quickly realise air pollution is not an issue confinedto emerging economies. in europe, road traffic is still responsible for 70 percent of total emissions. >>reporter: that's why the italian capital hosted a conference. the aim: to find new ways to combatair pollution. >>manfredi: we are all aware at times of financial crisis that our industry and in general how our economy is going through, how to transform the need to face emission challenges into a growth opportunity for all of us. >>reporter: one solution is to fit heavy-duty diesel vehicles with filters, that's because aging trucks and buses are heavily blamed for emitting fine polluting particles into the atmosphere.

>>new vehicles already have filters, but it's the majority that don't -- that have people worried. >>retro-fitting is the main solution. in london, one of the most polluted cities in europe, new legislation means that 60,000 trucks have now been retro-fitted. >>coyle: heavy duty vehicles are designed to last such a long time there isn't time to wait for them to die out because they will continue to contribute to high emissions. >>reporter: the fact is, new porous ceramic technology used in these filters can now remove almost all the airborne pollution. >>provera: the most dangerous particles are the nano-particles below one micron and of this 99.8 percent are taken out, .... due to some special catalyst and electronic device the carbon is automatically burnt so the filter comes back

and again becomes clean. >>reporter: a fact not lost on a team from the chinese government. traffic here has mushroomed due to double digit economic growth, clogging-up cities with deadly air pollution. >>dagang: there are a lot of old diesel vehicles in china. the emission levels are really high. we are going to retro-fit some of those high level emitters. >>reporter: one of the world's leading retro-fitters of particle emission, truck filters is pirellieco technology, a subsidiary of the world-famous tyre group. >>reporter: it's now specialising in green technology, as well as combating air pollution. part of this process involves opening a factory in yanzhou shandong province to tackle china's toxic vehicles. >>provera: china is very polluted; china has very big problems and it's like europe in the 1950s. the speed

of the cars is very low in a city like beijing where the average speed is about 11 or 12 kmper hour which makes the situation even worse. >>reporter: yet filters cost between 3,500 and 7,000 dollars to install. it sounds like a lot -- but the health benefits may outweigh the expense. >>moshammer: we have so many studies now showing that air pollution is harmful to health especiallythe fine particles and the ultra-fine particles. there is no other way other than filters which canreduce this pollution. >>reporter: another multi-billion dollar market is india. its growing obsession with vehicles has seen air pollution skyrocket. >>according to india's central pollution control board, new delhi's air quality reaches an unacceptable level more than 90% of the time. >>froggatt: everyone could be doing lots more but if you look at asia...that is a very low environmental standard, very low efficiency

standard.... best practice would reduce emissions significantly. >>reporter: in addition to china with its market of 1.3 billion people, india also represents serious potential for anti-emission technologies. an opportunity european companies are looking to exploit. >>provera: india is a very, very important country for our future development on the filter, because there are several million of truck and buses, very, very old ...and that is the reason why it is one of the most important country for us. >>reporter: but when it comes to cleaning up its act, india has a lot of other issues: adulterationof fuel, poor maintenance and no norms for when a vehicle expires. while businesses find that legislation is poorly enforced. >>mahindra: every one in the west understands a little piece of india. the question is do you understand the whole mosaic....and it is difficult,

it is complex...i dare say even i don't understand the whole mosaic. >>reporter: complex perhaps, but india and china's pollution risk is likely to produce new levels of environmental regulation and new business opportunities in green tech. >>it's fast, spectacular, and more than a little bit dangerous. motocross first took place in britain in the 1920's...but in the country of its birth, the sport has recently fallen on hard times. however, one series at least, is hoping to change all that >>nunn: you're jumping anywhere up to 100 feet. even further sometimes >>brown: the jumps...the bumps bikes always going diff ways. >>nunn: the bikes are jumping

around everywhere. >>reporter: they've been doing this sort of thing for almost 100 years in britain now... >>but while spectacular...motocross here remains a stubbornly niche sport....something the red bull pro national series is trying to change... >>bates: there's no-one really pushing it from a non specialist corner. so if there's no-one makingthat effort to get it in the newspapers and get it into mainstream tv then it won't ever get there. >>james: motocross is massive in the uk from club level right up to this level. but we needed an injection of a new championship and this is where the redbull comes in >>reporter: now in its second year...the pro nationals goal, with 6 events a season, is to provide quality competition and facilities, in a festival atmosphere...

>>mclelland: it's definitely the best marketing... does the best job of any of the other organizations...taking the sport forward >>reporter: motocross in the uk is a slightly disparate beast. there are various controlling bodies, and the organization of major championships tends to be farmed out to the hosting clubs. this series however...has a dedicated track crew to improve consistency....and prides itself on the mixing ofpros, semi pros and youngsters on the same race card... >>i like that the motorbikes are very fast. and you can go very fast on them. >>just try and stay on the bike really. get out of the start gate and stay on. >>reporter: but not working so well this weekend? >>been getting out of the gate but i just fall off. >>reporter: mixing with the pros, the youngsters fast learn the vital importance of good technique,commitment, tenacity and above all... having supportive parents....

>>walker: they have all the faith in me and everything...and pay a lot of money out. >>walker: 3000 to buy a bike and you also have 2 of them in case one goes down. spares. it's a veryexpensive hobby to do but.... >>reporter: it certainly makes a pair of football boots look cheap...although even riders barely taller than their bikes can pick up sponsors...such as junior bike-maker cobra which commands 90% of the us market, and is now looking to move into europe... >>mclelland: we help with the bike and parts and technical support. >>reporter: and this is a sport where you need support...whether it's a team sponsor, or the peopleholding the pit boards whose messages range from the informative, to the inspirational...to the lets face it....somewhat obvious...

>>meanwhile...if you're going to take this sport seriously, you'd better get some physical training in because while racing, the pros have to maintain a heartrate of over 170 beats per minute for about half an hour. >>brown: if you get someone who's never done it before get on the bike and do one lap...can't hardly breathe you know... >>reporter: as for picking up injuries...well...even being a spectator round here can be a bit hair-raising... >>nunn: you've got 39 other guys out there you can bang into ride into and crash. >>brown: i broke my collarbone in the winter. had to have it plated. i got plates in my hands. hurtmy ankles. >>nunn: you just take knocks and bangs all the time. its just part and parcel of it. >>mills: they go over the limit and they crash and i don't do that. >>reporter: although he may have to push the limit to become a professional. >>nunn: because if you want to do it professionally and properly you can't have a 9 to 5 job >>brown: full time job. 7 days a week

>>reporter: although once you reach the pros, you may well find the track you're riding on, is hardly paved with gold... >>bates: i think over the year we've got a 70,80 thousand pound prize purse. >>brown: if you have a good season...good bonus money ... you could make over 50000. >>james: probably 30-40 grand a year probably, maybe some of them a bit more. >>reporter: it's early days for the series...and while the crowds are by no means huge...recent signs are promising... >>bates: we started off with nothing and we now have an average of around 7000 people come to our events. each one of our rounds and the aim is maybe we will be hitting 10, 15000 people per round over the next 2 to 3 years. >>reporter: which,may be ambitious, but perhaps not unrealistic, given the spectacle provided, by both those off the track and on....from the fastest....to the lastest...

>>the record for the longest jump ever on a motorcycle is currently held by australian robbie maddison - a shade over 350 feet! >>that's it for this week's world business. thanks for watching. we'll see you again at the same time next week.