Who Will Ride India's Next Wave?

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Private education in India is growing more than 30% per year, and the profitability of this sector exceeds that of most North American institutions. Companies like Manipal Education are at the forefront of this growth as they continue to develop innovative solutions to meet the increased demand.

Environmental services is becoming one India's the fastest-growing Next Wave Verticals, as an increasingly industrialized economy and wealthy population elevates the need for clean air and water and the recycling of scarce natural resources. The Indian government is looking to the private sector to build and manage numerous aspects of environmental services to include waste-water treatment, hazardous waste disposal and air-quality control systems. Considering that approximately 70% of India's cities do not have adequate waste-water treatment, the financial opportunities in this area alone are significant. India's carbon-credit market is currently valued at $5 billion and is expected to double to $10 billion by 2009. This will create a significant opportunity for carbon-capture equipment and for environmental consulting services that focus on reducing greenhouse gases.

Renewable energy is a global issue that could define India's long-term economic success. India has very little in the way of crude oil reserves and finding new fields will become a costly proposition. As India's economy continues to grow, so will its energy needs. Developing renewable sources of energy is a national priority. Renewable energy only accounts for about 5% of India's total energy consumption. The Indian government has set a goal of generating 50% of the country's energy needs by 2050. This will require massive investments in a wide range of renewable energy sources.

Moser Baer Photovoltaic Planning an IPO

India is already developing technical and manufacturing leadership in several areas including wind, solar, and biomass. Suzlon Energy, a publicly traded Indian company, is now the world's fifth-largest wind energy provider, and its ranking is expected to climb in the near future. Moser Baer Photovoltaic, which is planning an initial public offering in 2009, is becoming a global leader in the development and manufacture of thin-film solar technology. And Bhoruka Power has become a leading player in the small hydro segment for power generation in India.

But the largest manufacturer of agricultural vehicles in India, Mahindra & Mahindra, is taking the lead in biodiesel. In February, 2007, the company introduced versions of its two most successful sport-utility vehicles, Scorpio and Bolero, which run on biodiesel. Scorpio is the first Asian vehicle in its class running on 100% biodiesel.

Mahindra also unveiled a biodiesel tractor for the first time in India. The company had set up its own biodiesel plant in 2001. It completed extensive studies and worked with IIT Kanpur, a leading Indian technology institute recognized globally, and the R&D center of Indian Oil Corp. Mahindra is also simultaneously working on its vehicles' fuel adaptability and trying to position itself for when India matures to the point of requiring better fuel sources.

Second Largest Producer of Sugar Cane

That day may not be far off, as India is the world's second-largest producer of sugar cane, which is a preferred source for ethanol. Renewable energy will provide investors and joint venture partners with significant returns during the coming years. And with opportunities in solar, wind, ethanol, and biodiesel, numerous global synergies are emerging exist between homebuilders, power companies, and automotive firms. Savvy investors and corporations already recognize the significant potential of the Next Wave. They know another wave like this won't crest for another 20 years or 30 years, and they're eyeing opportunities to capitalize on this unique opportunity.

William Nobrega is president and founder of the Conrad Group, an emerging-market strategic planning and M&A facilitation firm based in Miami. He has more than 10 years experience in this field and is widely credited for initiating global business models in emerging geographies including Brazil, India, and China. He is co-author of the recently published book, Riding the Indian Tiger: Understanding India, the World's Fastest Growing Market.