04/03/2016 Asia Business Report

responded the UK would be better off inside a reformed EU.

Now on BBC News, all the latest business news live from Singapore.

As China's political elite gather in Beijing, what clues might be given

about the direction of the economy? And why India's ancient caste system

is still a powerful influence when it comes to who gets the job.

Welcome to Asia Business Report. Nearly 3000 of China's most senior

politicians will kick off the annual national and -- National People's

Congress this weekend. Much is secret about this meeting but most

of what we expect relates to the economy. There will be a new

five-year plan, which includes economic goals, and a new growth

target as well. And we will be expecting an indication about what

they intend to do with struggling state owned enterprises. Earlier I

spoke with our Asia business correspondent about what we could

expect. It is the biggest political pantomime for that Chinese Communist

Party every year. What is essential and what people outside of China

will be looking for is any kind of signal as to what direction the

economy will be taking over the next five years. We are all intricately

linked to what goes on in the world's second largest economy. All

the way from Australia up to the UK. So there will be a great deal of

attention paid to comments that come out on Saturday, when we get the

state of the nation speech. And also some of the growth targets, as you

were mentioning. No surprises. We already know China is slowing down

and making the transition from an investment led economy to one based

on consumption and services. That is the big question. What's really

interesting is it's a rare insight into the thinking, the policy direct

is, that these leaders will take. -- policy directions. Already we have

some indication. The five-year plan was actually released back in

November. There is no big surprise in terms of what the policy

direction might be, but one big area of concern highlighted this week by

Moody's is state owned enterprises. Because they are basically like 'The

Walking Dead', bloated, massive companies, in a great deal of

trouble because they have a lot of debt. But they also employ millions

across the mainland. How China will find that balance, getting rid of

these companies but finding jobs for some of those people who might need

to be laid off, that'll be a key concerns. It doesn't help as well,

especially when we look back to what happened last summer, that policy

seems to be everywhere for the Chinese and a lot of criticism that

they don't seem to be getting it right. There's a great deal of

concern that they kind of lost control of what they were trying to

do. But in the lead up to this particular Congress, we've seen

Chinese stock markets valued, they've been going up, and there are

hopes of some sort of stimulus. So all eyes on the Congress. All eyes

indeed. Shares of the embattled electronics giant Sharp gained 8%

this morning, after the Nikkei business daily reported the chairman

is injured -- is in Japan, holding talks to buy the embattled

electronics giant. Both sides are seeking to conclude by Monday.

Ratings agency Moody's has downgraded the rating, citing the

deterioration in earnings and cash flow. Falling commodity prices have

had a serious impact on the mining giant and it expects low prices. We

talk a lot about the value of brands on this programme, but what about

sponsorship? How does a company measure the value it gets from the

money it pours into putting its name on big events? HSBC is one for doing

just that. It will sponsor an international women's golf

tournament, under way now in Singapore. HSBC is a global

organisation with 47 million customers and it makes a profit

looking after their money. So you might ask, what's the connection

between a bank and this? Golf. Again some would say is an acquired taste.

Well, the head of sponsorship for HSBC globally is Giles Morgan and he

joins me now. Why golf? It isn't a game young people are flocking to

and some people see it as elitist and for the wealthy. There are

people who say that. We believe the opposite. It is one of the most ex-

-- inclusive games in the world, in terms of all ages and both men and

women, and it is also international. It is coming to the Olympic Games

and it has a new showcase. You focus very much on sport, rugby, tennis

and golf, and a limited audience. Do you do cultural events? How

important is it to spread that goal? It's a targeted audience. The Rugby

Sevens audience and golf provide us with a certain type of customers. We

are also looking to broaden audiences in certain markets, more

community-based associations. It really depends on the market what is

available and what we are focusing on, which is wide we do sponsorship.

HSBC is undergoing a massive cost reduction programme. You've got job

cuts, a freeze on hiring, share prices down. Why spend millions on

sponsorship? We believe that when we look to increase our profitability

we have to keep marketing our brand, we have to keep engaging customers

and we have to keep flying our flag about the open for business around

the world where we do business. But the budget has been cut? Mary Mac

every thing has been produced, we are doing fewer things better,

creating better value for shareholders and the business.

Thanks for your time. The link may not seem immediately obvious between

a bank and golf, not for HSBC apparently putting money into sports

like this is the profit equivalent of a hole in one.

India may have the fastest growing economy in the world, but the

country's ancient caste system still dictates social structure. There are

quotas of government jobs set aside to give people in lower castes

opportunities. Recently there were violent protests by an upper caste

community, demanding their own job quotas. We report on why the caste

system remains a powerful influence. For several days protesters from

this community vented their few we. -- of their anger. Violence which

caught the authorities by surprise and led to many deaths and

large-scale destruction. Several towns in the state and highways

leading to the capital were affected.

At the heart of the protest is the changing face of the local economy.

Traditionally, much of the land here has been used for farming. They are

growing wheat in these fields. But increasingly agriculture is giving

way to industry. Farmland is being acquired to make factories such as

the one here. All part of the move to transform India's economy. But

while the landscape is changing, the transition to a new economy has been

difficult for those who live off the land. This is a relatively affluent

farming community but there's not enough land left the farm on.

TRANSLATION: The government is busy acquiring our land, building groats

or a Railtrack elsewhere. We barely get enough compensation. -- will

bring roads. We are falling in debt. The area has colleges and education

institutes, as young people try to acquire new skills. But degrees are

readily available and jobs are not. I meet a group of college students

who tell me unemployment is really high. TRANSLATION: My friend got 430

marks in his examination. He didn't even get called for an interview.

But someone from the lower caste scored 405 and landed himself a

government job. It is depressing. The private sector only employs

about 12% of the workforce, which is why government jobs are so heavily

sought-after. But 50% of those jobs are set aside for lower castes, to

overcome centuries of discrimination and social disadvantages. That's

leading to growing resentment among other communities who feel left out

and are increasingly willing to hit back.

Let's take a look at the markets before we go. Asian shares are

fairly muted this Friday morning. The Nikkei has opened lower,

continues lower, mainly due to the strong yen that eating into

exporters. Australia is gaining and that's due to commodity prices,

leading to again. BHP Billiton got that downgrade earlier. But the

shares continue to rise in Australia and the Hang Seng has also opened

higher. That's it for this edition of Asia Business Report. Thanks for

watching.