UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549









FORM
10-K









þ
            
            Annual
      report under Section 13 or 15(d) of the Securities Exchange Act of
      1934.For
      the fiscal year ended March 31,
2009




o
            
            Transition
      report under Section 13 or 15(d) of the Exchange
  Act.




Commission
file number000-1326205




INDIA
GLOBALIZATION CAPITAL, INC.


(Name of
small business issuer in its charter)




Maryland
                (State
      or other jurisdiction of incorporation or organization)
              
              20-2760393
                (I.R.S.
      Employer Identification No.)




4336 Montgomery Ave.
Bethesda, Maryland 20814


(Address
of principal executive offices)




(301) 983-0998


(Issuer’s
telephone number)


Securities
registered under Section 12(b) of the Exchange Act:




Title of Each Class
            
            Name of exchange on which
      registeredUnits,
      each consisting of one share of Common Stock
            
            NYSE
      Alternextand
      two WarrantsCommon
      Stock
            
            NYSE
      AlternextCommon
      Stock Purchase Warrants
            
            NYSE
      Alternext




Securities
registered under Section 12(g) of the Exchange Act: None.





Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act. Yes  o  No  þ




Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act.     o
Yes          þ No




Indicate
by check mark whether the registrant : (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
          þ
Yes             
o No




Indicate
by check mark disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K (§229.405 of this chapter) is not contained herein, and will
not be contained herein, and will not be contained, to the best of registrant’s
knowledge, in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this Form 10-K.
þ





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of “accelerated
filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.
(Check one):




Large
Accelerated Filer o   
Accelerated Filer o   
Non-Accelerated Filer o     Smaller
Reporting Company þ





Indicate
by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act).
          o Yes
           þ No




State the
aggregate market value of the voting and non-voting common equity held by
non-affiliates computed by reference to the price at which the common was last
sold, or the average bid and asked price of such common equity, as of the last
business day of the registrant’s most recently completed second fiscal quarter:
$30,395,717





As of May
31, 2009 there were 10,091,171 shares of common stock issued and
outstanding.





DOCUMENTS
INCORPORATED BY REFERENCE




Table of Contents






INDEX




PagePART
      IItem
      1.
            Business
            3Item
      1A.
            Risk
      Factors
            6Item
      1B.
            Unresolved
      Staff Comments
            10Item
      2.
            Properties
            10Item
      3.
            Legal
      Proceedings
            10Item
      4.
            Submission of Matters to Vote of Security
      Holders
            10PART
      IIItem
      5.
            Market
      for Registrant’s Common Equity and Related Stockholder
      Matters
            11Item
      6.
            Selected
      Financial Data
            12Item
      7.
            Management's
      Discussion and Analysis of Financial Conditions and Results of
      Operations
            17Item
      7A.
            Quantitative
      and Qualitative Disclosures about Market Risks
            21Item
      8.
            Financial
      Statements and Supplementary Data
            23Item
      9.
            Changes in and
      Disagreements with Accountants on Accounting and Financial
      Disclosure
            24Item
      9A(T).
            Evaluation of
      Disclosure Controls and Procedures
            24Item
      9B.
            Other
      Information
            24PART
      IIIItem
      10.
            Directors and
      Executive Officers and Corporate Governance
            25Item
      11.
            Executive
      Compensation
            29Item
      12.
            Security
      Ownership of Certain Beneficial Owners and
      Management
            32Item
      13.
            Certain
      Relationships and Related Transactions, and Director
      Independence
            35Item
      14.
            Principal
      Accountant Fees and Services
            36PART
      IVItem
      15.
            Exhibits and
      Financial Statements Schedules
            38Signatures
            40Section
      1350 CertificationSection
      1350 Certification




Table of Contents




PART
I


Item 1.  Business




Background of India Globalization
Capital, Inc.
(IGC)





IGC, a
Maryland corporation, was organized on April 29, 2005 as a blank check
company formed for the purpose of acquiring one or more businesses with
operations primarily in India through a merger, capital stock exchange, asset
acquisition or other similar business combination or acquisition. On March 8,
2006, we completed an initial public offering.  On February 19, 2007,
we incorporated India Globalization Capital, Mauritius, Limited (IGC-M), a
wholly owned subsidiary, under the laws of Mauritius.  On March 7,
2008, we consummated the acquisition of 63% of the equity of Sricon
Infrastructure Private Limited (Sricon) and 77% of the equity of Techni Bharathi
Limited (TBL). The shares of the two Indian companies, Sricon and TBL, are held
by IGC-M.  On February 19, 2009 IGC-M beneficially purchased 100% of
IGC Mining and Trading, Limited (IGC-IMT based in Chennai,
India).  IGC-IMT was formed on December 16, 2008 as a privately held
start-up company engaged in the business of mining and trading.  Its
current activity is to operate a shipping hub and export iron ore to
China.  India Globalization Capital, Inc. (the Registrant, the
Company, or we) and its subsidiaries are significantly engaged in one segment,
infrastructure construction.





IGC’s
organizational structure is as follows:













Most of
the shares of Sricon and TBL acquired by IGC were purchased directly from the
companies. IGC purchased a portion of the shares from the existing owners of the
companies.  The founders and management of Sricon own 37% of Sricon
and the founders and management of TBL own 23% of TBL.





The
acquisitions were accounted for under the purchase method of
accounting.  Under this method of accounting, for accounting and
financial purposes, IGC-M, Limited was treated as the acquiring entity and
Sricon and TBL as the acquired entities.  The financial statements
provided here and going forward are the consolidated statements of IGC, which
include IGC-M, Sricon, TBL and their subsidiaries.  However,
historical description of our business for periods and dates prior to March 7,
2008 include information on Sricon and TBL.





Unless
the context requires otherwise, all references in this report to the “Company”,
“IGC”, “we”, “our”, and “us” refer to India Globalization Capital, Inc, together
with its wholly owned subsidiary IGC-M, and its direct and indirect subsidiaries
(Sricon, TBL and IGC-IMT).





Our
Securities





We have
three securities listed on the NYSE Alternext: (1) common stock, $.0001 par
value (ticker symbol: IGC), (2) redeemable warrants to purchase common stock
(ticker symbol: IGC.WS) and (3) units consisting of one share of common stock
and two redeemable warrants to purchase common stock (ticker symbol:
IGC.U).  On March 8, 2006, we sold 11,304,500 units in our initial
public offering.  These 11,304,500 units include 9,830,000 units sold to
the public and the over-allotment option of 1,474,500 units exercised by the
underwriters of the public offering. The units may be separated into common
stock and warrants.  Each warrant entitles the holder to purchase one
share of common stock at an exercise price of $5.00.  The warrants
expire on March 3, 2011, or earlier upon redemption.  The
registration statement for initial public offering was declared effective on
March 2, 2006.  The warrants are exercisable and may be exercised by
contacting the Company or the transfer agent Continental Stock Transfer &
Trust Company.  We have a right to call the warrants, provided the
common stock has traded at a closing price of at least $8.50 per share for any
20 trading days within a 30 trading day period ending on the third business day
prior to the date on which notice of redemption is given.  If we call the
warrants, the holder will either have to redeem the warrants by purchasing the
common stock from us for $5.00 or the warrants will expire.




On March
7, 2008, we bought and redeemed a total of 6,159,346 shares.  As a
result, of the redemption and the subsequent issuance of an aggregate of 210,000
shares of common stock in private placements, including the issuance to Red Chip
Companies described below, on December 31, 2008, we had 8,780,107 shares
outstanding (including shares sold to our founders in a private placement prior
to the public offering) and 24,874,000 shares of common stock were reserved for
issuance upon exercise of redeemable warrants and underwriters’ purchase
option.




On
January 9, 2009 we completed an exchange of 11,943,878 public and private
warrants for 1,311,064 new shares of common stock.  Following the
issuance of the shares relating to the warrant exercise, we have 10,091,971
shares of common stock outstanding and warrants to purchase 11,855,122 shares of
common stock outstanding.  For details relating to the warrant
exercise, see our December 31, 2008 10Q and the Warrant Tender Offer section of
this annual report.






3
 Table of Contents




Overview





Sricon
Infrastructure Private Limited (“Sricon”) was incorporated as a private limited
company on March 3, 1997 in Nagpur, India.  Sricon is an engineering
and construction company that is engaged in three business areas: 1) civil
construction of highways and other heavy construction, 2) mining and quarrying
and 3) the construction and maintenance of high temperature cement and steel
plants.  Sricon’s present and past clients include various Indian
government organizations.   It has the prior experience to bid on
contracts that are priced at a maximum of about $116
million.   As indicated in previous press releases and quarterly
reports, in October 2008 lack of available credit drove Sricon to curtail much
of its construction activity, as it was unable to provide Bank Guarantees for
construction contracts, and to focus on long term recurring contracts such as
maintenance of high temperature cement factories.  This led to a sharp
decline in overall revenue.  Sricon took several steps to curtail its
expenses including lay offs.  Sricon also turned its attention to
pursuing claims against the contracting agencies for delays it had suffered on
some of its contracts.  Due to arbitration requirements in our
contract agreements, we expect our claims to be resolved in arbitration. Sricon
claims losses from having to maintain equipment and personnel during the delay
period, as well as opportunity costs.  There can be no assurance that
Sricon will be successful in its claims.  While the cost associated
with delays is accounted in the relevant period, any revenue from claims is not
accounted until and unless they are paid.




Techni
Bharathi Limited (“TBL”) was incorporated as a public (but not listed on the
stock market) limited company on June 19, 1982 in Cochin, India.  TBL
is an engineering and construction company engaged in the execution of civil
construction and structural engineering projects.  TBL has a focus in
the Indian states of Andhra Pradesh, Karnataka, Assam and Tamil Nadu. Its
present and past clients include various Indian government
organizations.  The overall lack of liquidity led TBL to curtail its
construction contracts and cut its costs through layoffs.  TBL is
re-focused on smaller construction contracts and the settlement of
claims.





IGC-M,
through its subsidiaries in India, is also involved in the building of rock
quarries and the export of iron ore.  IGC-M operates a shipping hub in
the Krishnapatnam port on the west coast of India.   We aggregate
ore from smaller mines before shipping to China.  We are also engaged
in the production of rock aggregate.  Rock aggregate is used in the
construction of roads, railways, dams, and other infrastructure
development.  We are in the process of developing several quarries
through partnerships with landowners.




Core
Business Areas





Our core
business areas include the following:





Highway and heavy
construction:





The
Indian government has articulated a plan to build and modernize Indian
infrastructure.  The government’s plan, calls for spending over $475
billion over the next five years for the expansion and construction of rural
roads, major highways, airports, seaports, freight corridors, railroads and
townships.





Mining
and Quarrying





As Indian
infrastructure modernizes, the demand for raw materials like stone aggregate,
coal, ore and similar resources is projected to increase. In 2006, according to
the Freedonia Group, India was the fourth largest stone aggregate market in the
world with demand of up to 1.1 billion metric tons.  We are in the
process of teaming with landowners to build out rock quarries; in addition we
have licenses for the installation and production of rock aggregate
quarries.   Our mining and trading activity centers on the export
of Iron ore to China.   India is the fourth largest producer of
ore.





Construction
and maintenance of high temperature plants





We have
an expertise in the civil engineering, construction and maintenance of high
temperature plants.  This requires specialized skills to build and maintain
high temperature chimneys and kilns.





Customers





Over the
past 10 years, Sricon has qualified in all states in India and has worked in
several, including Maharashtra, Gujarat, Orissa and Madhya
Pradesh.  The National Highway Authority of India (NHAI) awards
interstate highway contracts on a national level, while intra-state contracts
are awarded by state agencies. The National Thermal Power Corporation (NTPC)
awards contacts for civil work associated with power plants. The National
Coal Limited (NCL) awards large mining contracts. Our customers include, or have
included, NHAI, NTPC, and various state public works departments.  Sricon
is registered across India and is qualified to bid on contracts anywhere in
India.  For the export of iron ore from India, we are developing
customers in China.





Contract
bidding process





In order
to create transparency, the Indian government has centralized the contract
awarding process for  building  inter-state
roads.  The new process is as follows: At the “federal” level, as an
example, NHAI publishes a Statement of Work for an interstate highway
construction project.  The Statement of Work has a detailed
description of the work to be performed as well as the completion time frame.
The bidder prepares two proposals in response to the Statement of Work. The
first proposal demonstrates technical capabilities, prior work experience,
specialized machinery, and manpower required, and other criteria required to
complete the project. The second proposal includes a financial
bid.  NHAI evaluates the technical bids and short lists technically
qualified companies. Next, the short list of technically qualified companies
are  invited to place a detailed financial bid and show adequate
financial strength in terms of  revenue, net worth, credit lines,
 and balance sheets. Typically, the lowest bid wins the contract. Also,
contract bidders must demonstrate an adequate level of capital reserves such as
the following:  1) An earnest money deposit between 2% to 10%
of  project costs, 2) performance guarantee of between 5% and 10%, 3)
adequate working capital and 4) additional capital for plant and
machinery.   Bidding qualifications for larger NHAI projects
are set by NHAI which are imposed on each contractor.  As the
contractor executes larger highway projects, the ceiling is increased by
NHAI.





4
 Table of Contents





Our
Growth Strategy and Business Model





Our
business model for the construction business is simple.  We bid on
construction, over burden removal at mining sites and or maintenance
contracts.   Successful bids increase our backlog of orders,
which favorably impacts our revenues and margins.   The
contracting process typically takes approximately six months. Over the
years, we have been successful in winning one out of every seven bids on
average.  We currently have one bid team.    In the
next year we will focus on the following: 1) build out between two and five rock
quarries, begin production and obtain long term contracts for the sale of rock
aggregate, 2) leverage our shipping hub, develop a second shipping hub, obtain
long term contracts for the delivery and sale of iron ore, 3) execute and expand
recurring contracts for infrastructure build out, 4) aggressively pursue the
collection of accounts receivables and delay claims.




Competition





We operate in an industry that is
fairly competitive.  However, there is a large gap in the supply of
well qualified and financed contractors and the demand for contractors. 
Large domestic and international firms compete for jumbo contracts over $250
million in size, while locally based contractors vie for contracts less than $5
million. The recent capital markets crisis has made it more difficult for
smaller companies to maturate into mid-sized companies, as their access to
capital has been restrained. Therefore, we would like to be positioned in the $5
million to $50 million contract range, above locally based contractors and below
the large firms, creating a distinct technical and financial advantage in this
market niche.  Rock aggregate is supplied to the industry through
small crushing units, which supply low quality material.  Frequently,
high quality aggregate is unavailable, or is transported over large
distances.  We fill this gap by providing high quality material in
large quantities.  We compete on price, quantity and
quality.  Iron ore is produced in India and exported to
China.  While this is a fairly established business, we compete by
aggregating ore from smaller suppliers who do not have access to customers in
China. Further, at our second shipping hub we expect to install a crusher that
can grind ore pebbles into dust, again providing a value added service to the
smaller mine owners.





Seasonality





The
construction industry (road building) typically experiences recurring and
natural seasonal patterns throughout India.  The North East Monsoons,
historically, arrive on June 1, followed by the South West Monsoons, which
usually lasts intermittently until September.  Historically, the
monsoon months are slower than the other months because of the
rains.  Activity such as engineering, maintenance of high temperature
plants, and export of iron ore are less susceptible to the rains.  The
reduced paced in construction activity has historically been used to bid and win
contracts. The contract bidding activity is typically very high during the
monsoon season in preparation for work activity when the rains
abate.  During the monsoon season the rock quarries operate to build
up and distribute reserves to the various construction sites.





Employees
and Consultants





As of
March 31, 2009, we employed a work force of approximately 400 employees and
contract workers worldwide.  Employees are typically skilled workers
including executives, welders, drivers, and other specialized experts. Contract
workers require less specialized skills. We make diligent efforts to comply with
all employment and labor regulations, including immigration laws in the many
jurisdictions in which we operate.  In order to attract and retain
skilled employees, we have implemented a performance based incentive program,
offered career development programs, improved working conditions, and
provided United States work assignments, technology training, and other fringe
benefits. We are hoping that our efforts will make our companies more
attractive.  While we have not done so yet, we are exploring adopting
best practices for creating and providing vastly improved labor camps for our
labor force.  We are hoping that our efforts will make our companies
“employers of choice” and best of breed.  As of March 31, 2009 our
Executive Chairman and Chief Executive Officer is Ram Mukunda and our Chairman
is Ranga Krishna.  Our Managing Director for Construction is Ravindra
Lal Srivastava, our Managing Director for Materials, Mining and Trading is P. M.
Shivaraman.   Our Treasurer and Principal Accounting officer is
John Selvaraj.  Our General Manager of Accounting based in India is
Santhosh Kumar.  We also utilize the services of several consultants
who provide USGAAP systems expertise and SOX expertise, among
others.





Environmental
Regulations





India has
very strict environmental, occupational, health and safety
regulations.  In most instances, the contracting agency regulates and
enforces all regulatory requirements.   We internally monitor and
manage regulatory issues on a continuous basis, and we believe that we are in
compliance in all material respects with the regulatory requirements of the
jurisdictions in which we operate. Furthermore, we do not believe that
compliance will have a material adverse effect on our business
activities.








Information
and timely reporting





Our
operations are located in India where the accepted accounting standards is
Indian GAAP, which in many cases, is  not congruent  to
USGAAP.  Indian accounting standards are evolving towards adopting
IFRS (International Financial Reporting Standards).    We
annually conduct PCAOB (USGAAP) audits for the company.  We
acknowledge that this process is at times cumbersome and places significant
restraints on our existing staff.  We believe we are still 12 to 18
months away from having processes and adequately trained personal in place to
meet the reporting timetables set out by the U.S. reporting
requirements.  Until then we expect to file for extensions to meet the
reporting timetables.  We will make available on our website, www.indiaglobalcap.com,
our annual reports, quarterly reports, proxy statements as well as up to- date
investor presentations.  Our SEC filings are also available at
www.sec.gov.




5
 Table of Contents




Item 1A.  Risk Factors




THE  FOLLOWING  RISK
FACTORS SHOULD BE CONSIDERED CAREFULLY IN EVALUATING THE COMPANY,  ITS
BUSINESS, CONDITION AND PROSPECTS (FINANCIAL AND OTHERWISE). THESE RISK FACTORS
ARE NOT NECESSARILY EXHAUSTIVE AND ADDITIONAL RISK FACTORS, IF ANY,
MAY  BE MATERIAL OR HAVE SIGNIFICANCE TO AN INDIVIDUAL INVESTOR. MANY
INVESTMENT OPPORTUNITIES  INVOLVE  RISK  FACTORS
OR A RISK OF LOSS AND THE EXISTENCE OF THE NORMAL AND CERTAIN
EXTRAORDINARY  RISKS.





Any
downgrading of India’s debt rating by an international rating agency, or an
increase in interest rates in India, could have a negative impact on our ability
to borrow in India.





As we
scale our operations we may increase the amount of money we borrow for working
capital and leasing of equipment. Any adverse revisions to India’s credit
ratings for domestic and international debt by international rating agencies as
well as an increase in Indian interest rates may adversely impact our ability to
finance growth through debt and could lead to a tightening of our margins,
adversely affecting our operating income.





A
change in government policy, a down turn in the Indian economy or a natural
disaster could adversely affect our business, financial condition, results of
operations and future prospects.





Our
construction business is dependent on the government of India as well as the
state governments for contracts.  Their operations and financial
results may be affected by changes in the government’s policy towards building
infrastructure.  In addition, the slow down in the Indian economy has
caused the government to slow down the pace of infrastructure building, which if
unchanged could adversely affect our future performance.  We foresee
no immediate changes to government policy or market conditions that would
adversely affect our ability to conduct business other than limited access to
credit.





Political,
economic, social and other factors in India may adversely affect
business.





Our
ability to grow our business may be adversely affected by political, economic,
social and religious factors, changes in Indian law or regulations and the
status of India’s relations with other countries. In addition, the economy of
India may differ favorably or unfavorably from the U.S. economy in such respects
as the rate of growth of gross domestic product, the rate of inflation, capital
reinvestment, resource self-sufficiency and balance of payments position.
According to the World Factbook published by the United States Central
Intelligence Agency, the Indian government has exercised and continues to
exercise significant influence over many aspects of the economy, and
privatization of government-owned industries proceeds at a slow pace.
Accordingly, Indian government actions in the future could have a significant
effect on the Indian economy, which could have a material adverse affect on our
ability to achieve our business objective.





Since
mid-1991, the Indian government has committed itself to implementing an economic
structural reform program with the objective of liberalizing India’s exchange
and trade policies, reducing the fiscal deficit, controlling inflation,
promoting a sound monetary policy, reforming the financial sector, and placing
greater reliance on market mechanisms to direct economic activity. A significant
component of the program is the promotion of foreign investment in key areas of
the economy and the further development of, and the relaxation of restrictions
in, the private sector. These policies have been coupled with the express
intention to redirect the government’s central planning function away from the
allocation of resources and toward the issuance of indicative guidelines. While
the government’s policies have resulted in improved economic performance, there
can be no assurance that the economic improvement will be sustained. Moreover,
there can be no assurance that these economic reforms will persist, and that any
newly elected government will continue the program of economic liberalization of
previous governments. Any change may adversely affect Indian laws and policies
with respect to foreign investment and currency exchange. Such changes in
economic policies could negatively affect the general business and economic
conditions in India, which could in turn adversely affect our
business.





Terrorist
attacks and other acts of violence or war within India or involving India and
other countries could adversely affect the financial markets and our
business.





Terrorist
attacks and other acts of violence could have the direct effect of destroying
our plant and property causing a loss and interruption of
business.  According to the World Factbook, religious and border
disputes persist in India and remain pressing problems. For example, India has
from time to time experienced civil unrest and hostilities with neighboring
countries such as Pakistan. The longstanding dispute with Pakistan over the
border Indian state of Jammu and Kashmir, a majority of whose population is
Muslim, remains unresolved. If the Indian government is unable to control the
violence and disruption associated with these tensions, the results could
destabilize the economy and, consequently, adversely affect our
business.





Since
early 2003, there have also been military hostilities and civil unrest in
Afghanistan, Iraq more recently Pakistan and other Asian countries. These events
could adversely influence the Indian economy and, as a result, negatively affect
our business.





While we may have insurance to cover
some of these risks and can file claims against the contracting agencies, there
can be no guarantee that we will be able to collect in a timely
manner.  Further, India has a fairly active insurgency and a fairly
active communist following.  Any uprising from these groups can delay
our roadwork and disrupt our business.  Terrorist attacks, insurgencies or the
threat of violence could slow down road building activity and the materials
business adversely affecting our business.





Exchange
controls that exist in India may limit our ability to utilize our cash flow
effectively following a business combination.




We are
subject to India’s rules and regulations on currency conversion. In India, the
Foreign Exchange Management Act or FEMA, regulates the conversion of the Indian
rupee into foreign currencies.  However, comprehensive amendments have
been made to FEMA to support the economic liberalization.  Companies
are now permitted to operate in India without any special restrictions,
effectively placing them on par with wholly Indian owned companies. In addition,
foreign exchange controls have been substantially relaxed. Notwithstanding these
changes, the Indian foreign exchange market is not yet fully developed and we
cannot assure you that the Indian authorities will not revert back to regulating
companies and imposing new restrictions on the convertibility of the Indian
rupee. Any future restrictions on currency exchanges may limit our ability to
use our cash flow for the distribution of dividends to our stockholders or to
fund operations we may have outside of India.




6
 Table of Contents




Changes
in the exchange rate of the Indian rupee may negatively impact our revenues and
expenses.




Our
operations are primarily located in India and we receive payment in Indian
rupees.  As the results of operations are reported in US dollars, to
the extent that there is a decrease in the exchange rate of Indian rupees into
US dollars, such a decrease could have a material impact on our operating
results or financial condition.





Returns
on investment in Indian companies may be decreased by withholding and other
taxes.





Our
investments in India will incur tax risk unique to investment in India and in
developing economies in general. Income that might otherwise not be subject to
withholding of local income tax under normal international conventions may be
subject to withholding of Indian income tax.  Under treaties with
India and under local Indian income tax law, income is generally sourced in
India and subject to Indian tax if paid from India. This is true whether or not
the services or the earning of the income would normally be considered as from
sources outside India in other contexts. Additionally, proof of payment of
withholding taxes may be required as part of the remittance procedure. Any
withholding taxes paid by us on income from our investments in India may or may
not be creditable on our income tax returns.





We intend
to avail ourselves of income tax treaties with India and minimize any Indian
withholding tax or local taxes.  However, there is no assurance that
the Indian tax authorities will always recognize such treaties and its
applications. We have also created a foreign subsidiary in Mauritius, in
order to limit the potential tax exposure.





The
cost of obtaining bank financing may reduce our income.





TBL and,
to a lesser extent, Sricon, have restructured some of their bank debt and may,
in the future, face higher interest rates or will require higher collateral with
the banks.  This increases the cost of money for the construction
business and could decrease our margins.   IGC expects to provide
collateral support for two to three years, by which time we expect the credit
worthiness of the construction business to increase to adequate
levels.  Further, collateral that has been provided to the banks
consists mostly of real estate, which has fallen in value, thus reducing our
ability to borrow.




Availability
of raw materials at competitive prices.





Construction
contracts are primarily dependent on adequate and timely supply of raw
materials, such as cement, steel and aggregates, at competitive prices. As the
demand from competing larger and well-established firms increases for procuring
raw materials, we could face an increase in the price of raw materials that may
negatively impact profitability.




Some
of our business is dependent on contracts awarded by the Government and its
agencies.





The
construction business is dependent on central and state budget allocations to
the infrastructure sector. We derive the bulk of our construction revenue from
contracts awarded by the central and state governments of India and their
agencies.  If there are delays in the payment of invoices by the
government, our working capital requirements could increase.





Compliance
with the Foreign Corrupt Practices Act could adversely impact our competitive
position. Failure to comply could subject us to penalties and other adverse
consequences.




We are
subject to the United States Foreign Corrupt Practices Act, which generally
prohibits United States public companies from engaging in bribery of or other
prohibited payments to foreign officials to obtain or retain business. While we
will take precautions to educate the employees of our subsidiaries of the
Foreign Corrupt Practices Act, there can be no assurance that we or the
employees or agents of our subsidiaries will not engage in such conduct, for
which we might be held responsible. We could suffer penalties that may have a
material adverse effect on our business, financial condition and results of
operations.




We may issue shares of our capital
stock, including through convertible debt securities, which would reduce the
equity interest of our stockholders and likely cause a change in control of our
ownership.




Our
certificate of incorporation authorizes the issuance of up to
75,000,000 shares of common stock, par value $.0001 per share and
1,000,000 shares of preferred stock, par value $.0001 per share. There
are currently approximately 50,000,000 authorized but unissued shares of our
common stock available for issuance (after appropriate reservation for the
issuance of shares upon full exercise of our outstanding warrants and the
purchase option granted to Ferris, Baker Watts, Inc. and shares authorized for
issuance under our 2008 Omnibus Incentive Plan) and all of the
1,000,000 shares of preferred stock available for issuance. We have
recently issued 200,000 shares of our common stock in connection with a private
placement of debt securities and may engage in similar private placements in the
future.  The issuance of additional shares of our common stock
including upon conversion of any debt securities:


•
            may
      significantly reduce the equity interest of our existing shareholders;
      and•
            may
      adversely affect prevailing market prices for our common stock, warrants
      or units.






7
 Table of Contents




We
may issue notes or other debt securities, which may adversely affect our
leverage and financial condition.





During
2008, we sold $2,000,000 in a private placement of debt securities and may
engage in similar private placements in the future. The incurrence of this
debt:


•
            may
      lead to default and foreclosure on our assets if our operating
      revenues  are insufficient to pay our debt
      obligations;•
            may
      cause an acceleration of our obligations to repay the debt even if we make
      all principal and interest payments when due if we breach the covenants
      contained in the terms of the debt documents;•
            may
      create an obligation to immediately repay all principal and accrued
      interest, if any, upon demand to the extent any debt securities are
      payable on demand; and•
            may
      hinder our ability to obtain additional financing, if necessary, to the
      extent any debt securities contain covenants restricting our ability to
      obtain additional financing while such security is outstanding, or to the
      extent our existing leverage discourages other potential
      investors.




Additional
capital maybe costly or difficult to obtain.




Additional
capital, whether through the offering of equity or debt securities, may not be
available on reasonable terms or at all, especially in light of the recent
downturn in the economy and dislocations in the credit and capital markets. If
we are unable to obtain required additional capital, we may have to curtail our
growth plans or cut back on existing business and, further, we may not be able
to continue operating if we do not generate sufficient revenues from operations
needed to stay in business.  We may incur substantial costs in
pursuing future capital financing, including investment banking fees, legal
fees, accounting fees, securities law compliance fees, printing and distribution
expenses and other costs. We may also be required to recognize non-cash expenses
in connection with certain securities we issue, such as convertible notes and
warrants, which may adversely impact our financial condition.




If
we are unable to repay the loan from Sricon, they may have difficulty competing
for future large contracts.




We
believe that Sricon will ultimately require the amounts they loaned us in order
to expand their operations and the scope of contracts on which they can
bid.  If we are unable to repay the loans made to us by Sricon on
time, they may be required to find alternative sources of funding for such
expansion, and the costs and timing of obtaining such funding may make it more
difficult for these companies to expand the scope of contracts for which
they can compete.  To the extent Sricon obtains additional funding, or
we are unable to repay the loans, it may result in the issuance of
additional shares of capital stock or our tender to Sricon of a portion of
the shares we acquired from them, resulting in the dilution of our interest in
Sricon.





Leveled
penalties for time overruns may adversely affect our economic
performance.





Sricon
and TBL execute construction contracts primarily in the roads and infrastructure
development sectors. Sricon and TBL typically enter into high value contracts
for these activities, which impose penalties if contracts are not executed in a
timely manner.  If Sricon and TBL are unable to meet the performance
criteria as prescribed by respective contracts, then levied penalties may
adversely affect our financial performance.




Our
business is dependent on continuing relationships with clients and strategic
partners.




Our
business is dependent on developing and maintaining strategic alliances with
contractors that undertake turnkey contracts for infrastructure development
projects as well as government organizations.  The business and our
results could be adversely affected if we are unable to maintain continuing
relationships and pre-qualified status with key clients and strategic
partners.





Our
business model relies heavily on our management team and any
unexpected loss of key officers may adversely affect our
operations




The
continued success of our business is largely dependent on the continued services
of key employees.  The loss of the services of certain key personnel,
without adequate replacement, could have an adverse effect on our performance.
Our senior management as well as the senior management of our subsidiaries have
played a significant role in developing and executing the overall business plan,
maintaining client relationships, proprietary processes and
technology.  While no one is irreplaceable, the loss of the
services of any would be disruptive to our business.  In order to
mitigate this risk factor we are recruiting professional managers and expanding
the executive ranks as well as pursuing succession-planning initiatives, but there can be no
guarantees that these mitigation efforts will be successful.




Quarterly financial
results will vary.




Factors
that may contribute to the variability of quarterly revenue, operating results
or profitability include:




·
            Fluctuations
      in revenue due to seasonality:  For example, during the monsoon
      season, the heavy rains slow down road building and construction
      work.  This results in uneven revenue and operating results
      through the quarters.  In general the months between June
      and September are the rainy seasons and these tend to be slower quarters
      than the others.





·
            Our
      revenue recognition policy records contract revenue for those stages of a
      project that we complete, after we receive certification from the client
      that such stage has been successfully completed.  Since revenue
      is not recognized until we receive a certification from our clients,
      revenue recognition can be uneven.




8
 Table of Contents




Our
subsidiaries may become involved in litigation in the future.





Our
subsidiaries are fairly large companies and may have to initiate actions in the
Indian Courts to enforce their rights and may also be drawn into legal
litigation.  The expenses of litigation and any judgments against us
could have a material adverse effect on us.




We
face competition in the Indian infrastructure industry.





The
Indian real estate and infrastructure industries are increasingly attracting
foreign capital.  We currently have competition from international as
well as domestic companies that operate at the national
level.  Smaller localized contractors and companies are also competing
in their respective regions.  If we are unable to offer competitive
prices and obtain contracts, there could be a significant reduction in our
revenue.




Our
operations are sensitive to weather conditions.





Our
business activities in India could be materially and adversely affected by
severe weather conditions. Severe weather conditions may require us to evacuate
personnel or curtail services and may result in damage to a portion of our fleet
of equipment or to our facilities, resulting in the suspension of operations,
and may further prevent us from delivering materials to project sites in
accordance with contract schedules or generally reduce our
productivity.  Difficult working conditions and extremely high
temperatures also adversely affect our operations during summer months and
during monsoon season, which restrict our ability to carry on construction
activities and fully utilize our resources.





The
revenue recorded in the first half of our fiscal year between June through
September is traditionally lower than revenue recorded during the second half of
our fiscal year due to the weather conditions.  During periods of
curtailed activity due to adverse weather conditions, we may continue to incur
operating expenses, reducing profitability.




We incur costs as a result of
operating as a public company. Our management is required to devote
substantial time to new compliance initiatives.  Because we report in
India in IGAAP and in the US in USGAAP, we may experience untimely close of our
books and records and delays in the preparation of financial statements and
related disclosures.





As part
of a public company with substantial operations, we are experiencing an
increase in legal, accounting and other expenses.  In addition the
Sarbanes-Oxley Act of 2002 (the “SOX” act), as well as new rules subsequently
implemented by the SEC and the NYSE Alternext, have imposed various requirements
on public companies, including requiring changes in corporate governance
practices.  Our management and other personnel need to devote a
substantial amount of time to these compliance initiatives.  We have
not evaluated or tested internal controls over financial reporting at Sricon and
TBL.  We expect to carry out the evaluations and take install systems
and processes as required. However, we cannot be certain as to the timing of
completion of the evaluation testing and remediation actions or the impact of
the same on our operations.





The
audit report provided by Yoganandh and Ram (Y&R) will require a review by a
US firm.





The SEC
requires that the 2009 audit, conducted by Y&R, be reviewed by another PCAOB
registered firm.  If the review identifies changes to the audit, we
will be required to amend our annual report as filed on Form
10-K.  The requirement of the review is expected to increase our
legal, accounting and other expenses.





The
Company has warrants outstanding, which could dilute the number of shares
outstanding.





At the
time the warrants are exercised, the company will get the exercise price, unless
the exercise is cashless.   In either case, such an exercise will
also increase the number of shares outstanding.  This may adversely
affect the share price as the supply of shares eligible for sale in the public
market will increase.  The increased number of shares offered for sale
in the public market may exceed the public demand to buy shares at a given
market price resulting in the market price adjusting downward to equalize supply
and demand.





If
the benefits of our acquisition of TBL and Sricon do not meet the expectations
of financial or industry analysts, the market price of our common stock may
decline.




The
market price of our common stock may decline if:




·
            we
      do not achieve the perceived benefits of our acquisition of TBL and Sricon
      as rapidly as, or to the extent anticipated by, financial or industry
      analysts; or




·
            the
      effect of our acquisition of TBL and Sricon on our financial statements is
      not consistent with the expectations of financial or industry
      analysts.




Accordingly,
investors may experience a loss as a result of a decreasing stock
price.




9
 Table of Contents




Although
we are required to use our best efforts to have an effective registration
statement covering the issuance of the shares underlying the public warrants at
the time that our warrant holders exercise their public warrants, we cannot
guarantee that a registration statement will be effective, in which case our
warrant holders may not be able to exercise our public warrants and such
warrants may expire worthless.




Holders
of our public warrants will be able to exercise the warrants only if a current
registration statement under the Securities Act of 1933 relating to the shares
of our common stock underlying the warrants is then effective. Although we have
undertaken in the warrant agreement, and therefore have a contractual
obligation, to use our best efforts to maintain a current registration statement
covering the shares underlying the public warrants to the extent required by
federal securities laws, and we intend to comply with such undertaking, with
such a registration statement currently effective, we cannot assure you that we
will be able to do so. In no event shall we be liable for, or any registered
holder of any warrant be entitled to receive, (a) physical settlement in
securities unless the conditions and requirements set forth in the warrant
agreement have been satisfied or (b) any net-cash settlement or other
consideration in lieu of physical settlement in securities. The value of the
public warrants may be greatly reduced if a registration statement covering the
shares issuable upon the exercise of the warrants is not kept current. Such
warrants may expire worthless.




Because
the warrants sold in the private placements were originally issued pursuant to
an exemption from registration requirements under the federal securities laws,
the holders of the warrants sold in the private placement will be able to
exercise their warrants even if, at the time of exercise, a prospectus relating
to the common stock issuable upon exercise of such warrants is not current. As a
result, the holders of the warrants purchased in the private placements will not
have any restrictions with respect to the exercise of their warrants. As
described above, the holders of the public warrants will not be able to exercise
them unless we have a current registration statement covering the shares
issuable upon their exercise.




If
equity research analysts do not publish research or reports about our business
or if they issue unfavorable commentary or downgrade our common stock, the price
of our common stock could decline.





The
trading market for our common stock will rely in part on the research and
reports that equity research analysts publish about our business and us. We do
not control these analysts. The price of our stock could decline if one or more
equity analysts downgrade our stock or if those analysts issue other unfavorable
commentary or cease publishing reports about our business or us.





We
do not currently intend to pay dividends, which may limit the return on your
investment in us.




We
currently intend to retain all available funds and any future earnings for use
in the operation and expansion of our business and do not anticipate paying any
cash dividends in the foreseeable future.





Item1B.       Unresolved Staff
Comments





None




Item2.
            Properties




We do not
own any real estate or other physical properties materially important to our
operation. Our headquarters are located at 4336 Montgomery Avenue, Bethesda,
Maryland, 20814.  Sricon’s headquarters are located at Pragati Layout,
Rajeev Nagar, Nagpur 440025, India.  TBL’s headquarters are located at
34/136 A Edappally Bypass Road, Cochin 682024, Kerala, India.  In
addition, we have offices in Mauritius, Delhi, Bombay and Bangalore,
India.  We have temporary facilities at each of our work centers in
the states of Maharashtra, Gujarat, Andhra Pradesh and Assam.




The  Company
is not involved in investments in (i) real estate or interests in real estate,
(ii) real estate mortgages, and (iii) securities of or interests
in  persons  primarily  engaged  in  real  estate
activities, as all of its land rights
are  used  for  production  purposes.




Item3.
            Legal
      Proceedings





TBL has a
loan for USD 713,710 due to Dhanlaxmi Bank, India.  This loan is overdue.
However, TBL has filed a suit against the bank in the DRT (Debt Restructuring
Tribunal, India) as there is a dispute.  The bank has offered to
settle the dispute for approximately USD 540,594, to be paid
in installments.   The loan
is collateralized by properties pledged by the original
Promoters of TBL.  As the collateral belongs to the Promoters of TBL, both
TBL and the TBL Promoters are undergoing discussions to determine the
circumstances under which the bank will be repaid.




Item4.
            Submission
      of Matters to a Vote of Security
Holders




None







10
 Table of Contents




PART
II




Item5.          
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities




The
Company commenced its initial public offering on March 8, 2006. In the
initial public offering, the Company offered units for purchase. A unit in
the Company is comprised of one share of common stock of the Company and two
warrants to purchase one share of common stock. On April 13, 2006, there
was a voluntary separation of the Company’s units into shares of common stock
and warrants to purchase common stock which permitted separate trading of the
common stock and warrants. The common stock, units and warrants trade on the
NYSE Alternext under the symbols “IGC,” “IGC.U,” and “IGC.WS,” respectively. The
following table sets forth the high and low sales prices of the units for the
fiscal year, as reported on the NYSE Alternext.




The
following table shows, for the last eight fiscal quarters, the high and low
closing prices per share of the Common Stock, Warrants and Units as quoted on
the NYSE Alternext:




Common
      Stock
                        
                        
                        Warrants
                        
                        
                        UnitsQuarter
      Ended
                        
                        High
                        
                        
                        Low
                        
                        
                        High
                        
                        
                        Low
                        
                        
                        High
                        
                        
                        LowJune
      30, 2007
                        
                        $
                        5.77
                        
                        
                        $
                        5.57
                        
                        
                        $
                        0.79
                        
                        
                        $
                        0.59
                        
                        
                        $
                        7.32
                        
                        
                        $
                        6.85September
      30, 2007
                        
                        $
                        5.85
                        
                        
                        $
                        5.64
                        
                        
                        $
                        0.63
                        
                        
                        $
                        0.36
                        
                        
                        $
                        7.10
                        
                        
                        $
                        6.40December
      31, 2007
                        
                        $
                        5.94
                        
                        
                        $
                        5.69
                        
                        
                        $
                        0.59
                        
                        
                        $
                        0.34
                        
                        
                        $
                        6.90
                        
                        
                        $
                        6.35March
      31, 2008
                        
                        $
                        5.90
                        
                        
                        $
                        3.60
                        
                        
                        $
                        0.73
                        
                        
                        $
                        0.25
                        
                        
                        $
                        7.45
                        
                        
                        $
                        4.15June
      30, 2008
                        
                        $
                        5.90
                        
                        
                        $
                        3.81
                        
                        
                        $
                        1.30
                        
                        
                        $
                        0.58
                        
                        
                        $
                        8.80
                        
                        
                        $
                        5.28September
      30, 2008
                        
                        $
                        4.99
                        
                        
                        $
                        4.50
                        
                        
                        $
                        1.00
                        
                        
                        $
                        0.55
                        
                        
                        $
                        6.86
                        
                        
                        $
                        5.65December
      31, 2008
                        
                        $
                        4.78
                        
                        
                        $
                        .70
                        
                        
                        $
                        .53
                        
                        
                        $
                        .01
                        
                        
                        $
                        5.75
                        
                        
                        $
                        .01March
      31, 2009
                        
                        $
                        1.10
                        
                        
                        $
                        .33
                        
                        
                        $
                        .13
                        
                        
                        $
                        .02
                        
                        
                        $
                        1.07
                        
                        
                        $
                        .40June
      30, 2009
                        
                        $
                        1.25
                        
                        
                        $
                        1.12
                        
                        
                        $
                        .06
                        
                        
                        $
                        .06
                        
                        
                        $
                        1.80
                        
                        
                        $
                        1.02




Holders





Continental
Stock Transfer & Trust Company is the transfer agent and registrar for our
common stock. As of March 31, 2009, we had1,019 holders of record
of our common stock, 187 holders of record of our units and 1,076 holders
of record of our warrants.  The last sale price as reported by the
NYSE Alternext on March 31, 2009, was $0.60 for units, $ 0.40 for shares and $
0.03 for warrants. The Company has never paid a cash dividend on its common
stock and does not anticipate the payment of cash dividends in the foreseeable
future.





Unregistered
Sales of Equity Securities





On March
7, 2008 Messrs. Mukunda and Krishna entered into an agreement with third parties
to transfer on September 8, 2008 pursuant to the terms of certain Share
Redistribution Agreements an aggregate of 1,368,031 shares of the Company’s
common stock.  Specifically, Mr. Mukunda agreed to transfer 1,131,581
shares and Dr. Krishna agreed to transfer 236,450 shares.   The
purpose of the agreements were to induce such third parties to acquire shares of
the Company's common stock and to cause such shares to be voted in favor of the
Company’s acquisition.





On
September 30, 2008, IGC consummated a private placement of unsecured notes in
the total principal amount of $2,000,000 and issued 200,000 shares of common
stock to the investor as additional consideration for the purchase of the
notes.  These transactions were exempt from registration under the
Securities Act in reliance upon the exemption from the registration requirements
provided in Section 4(2) of the Securities Act, which exempts private issuances
of securities in which the securities are not offered or advertised to the
general public.  No underwriting discounts or commissions were paid
with respect to such sales.





Warrant
Tender Offer




In an
effort to raise additional capital and reduce the number of warrants
outstanding, on November 24, 2008, we announced to the holders of all 22,609,000
outstanding, publicly traded warrants and of 1,190,000 warrants issued by the
Company in private placements the opportunity to acquire shares of common
stock. We modified the terms of the Warrants to (1) permit, instead of paying
the purchase price of $5.00 in cash, the exchange of 5 Warrants and $0.55 for
one share of Common Stock and (2) permit the exercise of a Warrant such that the
Holder will receive one share of Common Stock in exchange for every 12 Warrants
surrendered. The Warrant holders could use one or both methods in exercising the
warrants for Common Stock. The offer was initially planned to commence on
Monday, November 24, 2008 and expire on December 23, 2008 as further described
in our initial Tender Offer Statement dated November 24, 2008 and filed with the
SEC on that date.




On
January 6, 2009, we extended the expiration date of the tender offer to January
9, 2009. Under the tender offer, 11,943,878 warrants (50% of the warrants
outstanding) were exercised, of which 2,706,350 warrants were exercised by
exchanging 5 warrants and $0.55 for one share of common stock and 9,237,528
warrants were exercised by surrendering 12 warrants for one share of common
stock. The offer resulted in the Company raising a total of $297,698.50 in cash
proceeds and issuing a total of 1,311,064 new shares of common
stock.




Following
the issuance of the shares relating to the warrant exercise, we have 10,091,971
shares of common stock outstanding. The remaining 11,855,122 warrants
outstanding after the tender offer will expire in accordance with their terms on
March 3, 2011.




11
 Table of Contents


Issuer
Purchases of Equity Securities




During
the fourth quarter of our fiscal year ended March 31, 2009, the Company made no
purchases of its equity securities other than pursuant to the tender offer
described above:




ISSUER
      PURCHASES OF EQUITY SECURITIESPeriod
                          
                          (a)
      Total Number of Shares Purchased
                          
                          
                          (b)
      Average Price Paid per Share (or Unit)
                          
                          
                          (c)
      Total Number of Shares (or Units) Purchased as Part of Publicly Announced
      Plans or Programs**
                          
                          
                          (d)
      Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May
      Yet Be Purchased Under the Plans or ProgramsMonth
      #1 (January 1, 2009-January 31, 2009)
                          
                          
                          0
                          
                          
                          
                          N/A
                          
                          
                          
                          N/A
                          
                          
                          
                          N/AMonth
      #2 (February 1, 2009-February 29, 2009)
                          
                          
                          0
                          
                          
                          
                          N/A
                          
                          
                          
                          N/A
                          
                          
                          
                          N/AMonth
      #3 (March 1, 2009-March 31, 2009)
                          
                          
                          0
                          
                          
                          
                          N/A
                          
                          
                          
                          N/A
                          
                          
                          
                          N/ATotal
                          
                          
                          0
                          
                          
                          
                          N/A
                          
                          
                          
                          N/A
                          
                          
                          
                          N/A




Dividends





IGC has
not paid any cash dividends on its common stock to date.  It is the
present intention of the board of directors to retain all earnings, if any, for
use in the business operations, and consequently, the board does not anticipate
declaring any dividends in the foreseeable future.  The payment of any
dividends will be with the discretion of the board of directors and will be
contingent upon our financial condition, results of operations, capital
requirements and other factors our board deems relevant.





Item6.         
Selected Financial Data





IGC and
all its subsidiaries have fiscal years that end at March 31.





IGC’s
historical information is derived from its audited financial statements for
the period from its inception (April 29, 2005) to March 31, 2006, for the fiscal
years ended March 31, 2007, 2008 and 2009. The information is only a summary and
should be read in conjunction with IGC’s historical financial statements and
related notes and IGC’s respective Management’s Discussion and Analysis of
Financial Condition and Results of Operations contained elsewhere herein. The
historical results included below and elsewhere herein are not indicative of the
future financial performance of IGC.





India
Globalization Capital, Inc.


Selected
Summary Statement of Income Data





Selected
      Statement of Operations Data:
                          
                          Year
      Ended
                          
                          
                          Year
      Ended
                          
                          
                          Year
      Ended
                          
                          
                          29-Apr-0531-Mar-09
                          
                          
                          31-Mar-08
                          
                          31-Mar-07
                          To
      March 31, 2006Revenue
                          
                          $
                          35,338,725
                          
                          
                          $
                          2,188,018
                          
                          
                          $
                          
                          
                          
                          $Other
      Income-Interest, net
                          
                          
                          -
                          
                          
                          
                          471,698
                          
                          
                          
                          3,171,818
                          
                          
                          
                          210,584Net
      Income (loss)
                          
                          
                          (521,576
                          )
                          
                          
                          (5,215,270
                          )
                          
                          
                          1,517,997
                          
                          
                          
                          (443,840
                          )Per
      Share DataEarnings
      per share – basic
                          
                          $
                          (0.05
                          )
                          
                          $
                          (0.61
                          )
                          
                          $
                          0.11
                          
                          
                          $
                          (0.14
                          )Earnings
      per share  - diluted
                          
                          $
                          (0.05
                          )
                          
                          $
                          (0.61
                          )Weighted
      Average SharesBasic
                          
                          
                          10,091,171
                          
                          
                          
                          8,570,107
                          
                          
                          
                          13,974,500
                          
                          
                          
                          3,191,000Diluted
                          
                          
                          10,091,171
                          
                          
                          
                          8,570,107






12
 Table of Contents




India
Globalization Capital, Inc.


Selected
Summary Balance Sheet Data








31-Mar-09
                        
                        
                        31-Mar-08
                        
                        31-Mar-07ASSETSInvestments
      held in trust fund
                        
                        $
                        -
                        
                        
                        $
                        -
                        
                        $
                        66,104,275Total
      Current Assets
                        
                        
                        19,498,584
                        
                        
                        
                        32,896,447
                        
                        
                        70,385,373Total
      Assets
                        
                        
                        51,832,513
                        
                        
                        
                        67,626,973
                        
                        
                        70,686,764LIABILITIESCurrent
      Liabilities
                        
                        
                        9,446,345
                        
                        
                        
                        17,384,059
                        
                        
                        5,000,280Total
      Liabilities
                        
                        
                        13,974,638
                        
                        
                        
                        26,755,261
                        
                        
                        5,000,280Common
      stock subject to possible conversion
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        12,762,785Total
      stockholders’ equity
                        
                        $
                        23,595,269
                        
                        
                        $
                        27,326,056
                        
                        $
                        52,923,699





The
following table sets forth certain selected financial data of
Sricon.  The selected financial data presented below was derived from
Sricon’s audited consolidated financial statements for the period April 1, 2007
through March 7, 2008 and for the three year period ended March 31, 2007, and
from Sricon’s unaudited consolidated financial statements for the year ended
March 31, 2004. The information is only a summary and should be read in
conjunction IGC’s historical financial statements and related notes and our
Management’s Discussion and Analysis of Financial Condition and Results of
Operations contained elsewhere herein. Additional information regarding Scrion’s
historical performance can be found in the Company’s Annual Report on Form
10-KSB for the year ended March 31, 2008. The historical results included below
and elsewhere herein are not indicative of the future financial performance of
IGC, Sricon and TBL.





Sricon
Infrastructure (Predecessor)


Selected
Summary Statement of Income Data





Amounts
      in Thousands Except Per Share Data
                              
                              Year
      Ended
                              
                              
                              Year
      Ended
                              
                              
                              Year
      Ended7-Mar-08
                              
                              31-Mar-07
                              31-Mar-06Revenue
                              
                              $
                              22,614
                              
                              $
                              10,604
                              
                              
                              $
                              11,011Income
      Before Tax
                              
                              
                              3,144
                              
                              
                              778
                              
                              
                              
                              668Income
      Taxes
                              
                              
                              (768
                              )
                              
                              (368
                              )
                              
                              
                              (186
                              )Net
      Income (loss)
                              
                              
                              2,376
                              
                              
                              410
                              
                              
                              
                              482Per
      Share DataEarnings
      per share – basic
                              
                              $
                              0.81
                              
                              $
                              0.14
                              
                              
                              $
                              0.16Earnings
      per share  - diluted
                              
                              $
                              0.78Weighted
      Average SharesBasic
                              
                              
                              2,932,159
                              
                              
                              2,932,159
                              
                              
                              
                              2,932,159Diluted
                              
                              
                              3,058,881







UnauditedYear
      Ended
                                    
                                    
                                    
                                    Year
      EndedAmounts
      in Thousands Except Per Share Data
                                    
                                    
                                    31-Mar-05
                                    
                                    
                                    
                                    31-Mar-04Revenue
                                    
                                    $
                                    11,477
                                    
                                    
                                    $
                                    15,298Income
      Before Tax
                                    
                                    
                                    907
                                    
                                    
                                    
                                    646Income
      Taxes
                                    
                                    
                                    (363
                                    )
                                    
                                    
                                    (199
                                    )Net
      Income (loss)
                                    
                                    
                                    544
                                    
                                    
                                    
                                    446Per
      Share DataEarnings
      per share – basic
                                    
                                    $
                                    0.19
                                    
                                    
                                    $
                                    0.11Earnings
      per share  - dilutedWeighted
      Average SharesBasic
                                    
                                    
                                    2,932,159
                                    
                                    
                                    
                                    183,259Diluted




13
 Table of Contents




Sricon
Infrastructure Private Limited (Predecessor)


Selected
Summary Balance Sheet Data




March
      7,
                      
                      
                      March
      31,
                      
                      
                      March
      31,(Amounts
      in Thousand US Dollars)
                      
                      2008
                      
                      
                      2007
                      
                      
                      2006ASSETSAccounts
      receivables
                      
                      $
                      7,764
                      
                      
                      $
                      2,751
                      
                      
                      $
                      2,083Unbilled
      receivables
                      
                      
                      4,527
                      
                      
                      
                      2,866
                      
                      
                      
                      2,980Inventories
                      
                      
                      447
                      
                      
                      
                      71
                      
                      
                      
                      248Property
      and equipment, net
                      
                      
                      5,327
                      
                      
                      
                      4,903
                      
                      
                      
                      4,347BOT
      Project under progress *
                      
                      
                      3,485
                      
                      
                      
                      3,080
                      
                      
                      
                      1,584LIABILITIESShort-term
      borrowings and current portion of long-term debt
                      
                      
                      5,732
                      
                      
                      
                      3,646
                      
                      
                      
                      3,868Due
      to related parties
                      
                      
                      1,322
                      
                      
                      
                      2,264
                      
                      
                      
                      1,604Long-term
      debt, net of current portion
                      
                      
                      1,264
                      
                      
                      
                      2,182
                      
                      
                      
                      1,855Other
      liabilities
                      
                      
                      1,519
                      
                      
                      
                      1,913
                      
                      
                      
                      697Total
      stockholders’ equity
                      
                      $
                      9,673
                      
                      
                      $
                      4,289
                      
                      
                      $
                      3,740


(Amounts
      in Thousand US Dollars)
                      
                      March
      31,
                      
                      
                      Unaudited31-Mar-042005ASSETSAccounts
      receivables
                      
                      $
                      2,128
                      
                      
                      $
                      2,223Unbilled
      receivables
                      
                      
                      974
                      
                      
                      
                      984Inventories
                      
                      
                      154
                      
                      
                      
                      71Property
      and equipment, net
                      
                      
                      3,424
                      
                      
                      
                      3,098BOT
      Project under progress *
                      
                      
                      0
                      
                      
                      
                      0LIABILITIESShort-term
      borrowings and current portion of long-term debt
                      
                      
                      5,103
                      
                      
                      
                      359Due
      to related parties
                      
                      
                      1,724
                      
                      
                      
                      1,553Long-term
      debt, net of current portion
                      
                      
                      1,278
                      
                      
                      
                      1,089Other
      liabilities
                      
                      
                      1,307
                      
                      
                      
                      1,267Total
      stockholders’ equity
                      
                      $
                      2,760
                      
                      
                      $
                      2,822





*BOT
Project under progress means Build, Operate, and Transfer. BOT is listed as
Accounts Receivable – Long term in the Consolidated Financial Statements for
IGC.  See the Summary of Significant Accounting Policies for a
detailed explanation of BOT projects.





The
following table sets forth certain selected financial data of Techni Bharathi
Limited.  The selected financial data presented below was
derived from Techni Bharathi
Limited audited consolidated financial statements for the period April 1,
2007 through March 7, 2008 and for the three year period ended March 31, 2007,
and from TBL’s unaudited consolidated financial statements for the year ended
March 31, 2004.  The information is only a summary and should be read
in conjunction IGC’s historical financial statements and related notes and our
Management’s Discussion and Analysis of Financial Condition and Results of
Operations contained elsewhere herein. Additional information regarding TBL’s
historical performance can be found in the Company’s Annual Report on Form
10-KSB for the year ended March 31, 2008. The historical results included below
and elsewhere herein are not indicative of the future financial performance of
IGC, Sricon and TBL.




14
 Table of Contents




Techni
Bharathi Limited (Predecessor)


Selected
Summary Statement of Income Data






(Amounts
      in Thousand US Dollars, except share data and as stated
      otherwise)
                      
                      April
      1 2007 to March 7, 2008
                      
                      
                      31-Mar-07
                      
                      
                      31-Mar-06Revenue
                      
                      $
                      5,321
                      
                      
                      $
                      4,318
                      
                      
                      $
                      2,285Income
      (loss) before income taxes
                      
                      
                      2,245
                      
                      
                      
                      401
                      
                      
                      
                      (2,369
                      )Income
      taxes
                      
                      
                      (86
                      )
                      
                      
                      135
                      
                      
                      
                      62Net
      (loss)/income
                      
                      
                      1,988
                      
                      
                      
                      536
                      
                      
                      
                      (2,307
                      )Per
      Share DataBasic
                      
                      $
                      0.46
                      
                      
                      $
                      0.13
                      
                      
                      $
                      (0.54
                      )Diluted
                      
                      $
                      0.22
                      
                      
                      $
                      0.13
                      
                      
                      $
                      (0.54
                      )Weighted
      Average SharesBasic
                      
                      
                      4,287,500
                      
                      
                      
                      4,287,500
                      
                      
                      
                      4,287,500Diluted
                      
                      
                      9,089,928
                      
                      
                      
                      4,287,500
                      
                      
                      
                      4,287,500




(Amounts
      in Thousand US Dollars, except share data and as stated
      otherwise)
                        
                        31-Mar-05
                        
                        
                        Unaudited31-Mar-04Revenue
                        
                        $
                        8,954
                        
                        
                        $
                        8,773Income
      (loss) before income taxes
                        
                        
                        (3,823
                        )
                        
                        
                        (2,609
                        )Income
      taxes
                        
                        
                        515
                        
                        
                        
                        (63
                        )Net
      (loss)/income
                        
                        
                        (3,308
                        )
                        
                        
                        (2,672
                        )Per
      Share DataBasic
                        
                        $
                        (0.77
                        )
                        
                        $
                        (0.62
                        )Diluted
                        
                        $
                        (0.77
                        )
                        
                        $
                        (0.62
                        )Weighted
      Average SharesBasic
                        
                        
                        4,287,500
                        
                        
                        
                        4,287,500Diluted
                        
                        
                        4,287,500
                        
                        
                        
                        4,287,500






Techni
Bharathi Limited (Predecessor)


Selected
Summary Balance Sheet Data





(Amounts
      in Thousand US Dollars)
                          
                          7-Mar-08
                          
                          
                          31-Mar-07
                          
                          
                          31-Mar-06ASSETSCash
      and cash equivalents
                          
                          $
                          736
                          
                          
                          $
                          1,208
                          
                          
                          $
                          69Inventories
                          
                          
                          1,428
                          
                          
                          
                          1,284
                          
                          
                          
                          4,182Prepaid
      and other assets
                          
                          
                          271
                          
                          
                          
                          1,231
                          
                          
                          
                          1,275Property,
      plant and equipment (net)
                          
                          
                          1,979
                          
                          
                          
                          2,265
                          
                          
                          
                          2,417LIABILITIESShort
      term borrowings and current portion of long-term loan
                          
                          
                          2,437
                          
                          
                          
                          6,079
                          
                          
                          
                          8,125Trade
      payable
                          
                          
                          2,222
                          
                          
                          
                          1,502
                          
                          
                          
                          987Long
      term debts, net of current portion
                          
                          
                          -
                          
                          
                          
                          2,333
                          
                          
                          
                          3,656Advance
      from customers
                          
                          
                          824
                          
                          
                          
                          1,877
                          
                          
                          
                          2,997Total
      Stockholders' equity
                          
                          $
                          (397
                          )
                          
                          $
                          (4,895
                          )
                          
                          $
                          (5,438
                          )




Unaudited(Amounts
      in Thousand US Dollars)
                                
                                31-Mar-05
                                
                                31-Mar-04ASSETSCash
      and cash equivalents
                                
                                $
                                83
                                
                                $
                                107Inventories
                                
                                
                                4,459
                                
                                
                                4,922Prepaid
      and other assets
                                
                                
                                1,765
                                
                                
                                2,070Property,
      plant and equipment (net)
                                
                                
                                3,463
                                
                                
                                3,985LIABILITIESShort
      term borrowings and current portion of long-term loan
                                
                                
                                6,291
                                
                                
                                6,614Trade
      payable
                                
                                
                                3,341
                                
                                
                                2,738Long
      term debts, net of current portion
                                
                                
                                3,897
                                
                                
                                2,892Advance
      from customers
                                
                                
                                3,057
                                
                                
                                2,755Total
      Stockholders' equity
                                
                                $
                                (3,032
                                )
                                $
                                320







15
 Table of Contents





IGC
India Mining & Trading PVT LTD


(Selected
Summary Statement of Income Data)




(Amounts
      in Thousand US Dollars, except share data and as stated
      otherwise)
                      
                      December
      16, 2008 (inception) to March 31, 2009Revenue
                      
                      $
                      0Income
      (loss) before income taxes
                      
                      
                      (8,644
                      )Income
      taxes
                      
                      
                      (78
                      )Net
      (loss)/income
                      
                      
                      (8,722
                      )Per
      Share DataBasic
                      
                      $
                      -Diluted
                      
                      $
                      -Weighted
      Average SharesBasic
                      
                      
                      -Diluted
                      
                      
                      -





IGC
India Mining & Trading PVT LTD


(Selected
Summary Balance Sheet Data)





(Amounts
      in Thousand US Dollars)
                      
                      31-Mar-09ASSETSCash
      and cash equivalents
                      
                      $
                      229,099InventoriesPrepaid
      and other assets
                      
                      
                      59,066Property,
      plant and equipment (net)LIABILITIESShort
      term borrowings and current portion of long-term loanTrade
      payable
                      
                      
                      1,154Long
      term debts, net of current portionAdvance
      from customersTotal
      Stockholders' equity
                      
                      $
                      287,011







16
 Table of Contents


Item7.          Management's
Discussion and Analysis





Forward-Looking
Statements





This
report contains forward-looking statements, including, among others,
(a) our expectations about possible business combinations, (b) our
growth strategies, (c) our future financing plans, and (d) our
anticipated needs for working capital. Forward-looking statements, which involve
assumptions and describe our future plans, strategies, and expectations, are
generally identifiable by use of the words “may,” “should,” “expect,”
“anticipate,” “approximate,” “estimate,” “believe,” “intend,” “plan,” or
“project,” or the negative of these words or other variations on these words or
comparable terminology. This information may involve known and unknown risks,
uncertainties, and other factors that may cause our actual results, performance,
or achievements to be materially different from the future results, performance,
or achievements expressed or implied by any forward-looking statements. These
statements may be found in this report. Actual events or results may differ
materially from those discussed in forward-looking statements as a result of
various factors, including, without limitation, the risks outlined under our
“Description of Business” and matters described in this report generally. In
light of these risks and uncertainties, the events anticipated in the
forward-looking statements may or may not occur. These statements are based on
current expectations and speak only as of the date of such statements. We
undertake no obligation to publicly update or revise any forward-looking
statement, whether as a result of future events, new information or
otherwise.




The
information contained in this report identifies important factors that could
adversely affect actual results and performance. All forward-looking statements
attributable to us are expressly qualified in their entirety by the foregoing
cautionary statements.





Background





IGC,
a Maryland corporation was organized on April 29, 2005 as a blank check
company for the purpose of acquiring one or more businesses with operations
primarily in India through a merger, capital stock exchange, asset acquisition
or other similar business combination or acquisition. On March 8, 2006, we
completed an initial public offering.  On February 19. 2007, we
incorporated India Globalization Capital, Mauritius, Limited (IGC-M), a wholly
owned subsidiary, under the laws of Mauritius.  On March 7, 2008, we
consummated an agreement to acquire 63% of Sricon Infrastructure Private Limited
(Sricon) and 77% of Techni Bharathi Limited (TBL). The shares of the two Indian
companies, Sricon and TBL, are held by IGC-M.  On December 16, 2009
IGC-M beneficially formed IGC Mining and Trading, Limited and obtained ownership
of it on March 29, 2009.   IGC-IMT is based in Chennai,
India.  There was no activity in IGC-IMT between December 16, 2008 and
March 29, 2009.





Most of
the shares of Sricon and TBL acquired by IGC were purchased directly from the
companies. IGC purchased a portion of the shares from the existing owners of the
companies.  The founders and management of Sricon own 37% of Sricon
and the founders and management of TBL own 23% of TBL.





The
acquisitions were accounted for under the purchase method of
accounting.  Under this method of accounting, for accounting and
financial purposes, IGC-M, Limited, was treated as the acquiring entity and
Sricon and TBL as the acquired entities.  The financial statements
provided here and going forward are the consolidated statements of IGC, which
include IGC-M, Sricon, TBL and their subsidiaries.  However,
historical descriptions of our business for periods and dates prior to March 7,
2008 include information on Sricon and TBL.




Sricon
was incorporated in 1997 with the Registrar of Companies, Maharashtra in the
name of “Srivastava Construction Private Limited.”  Sricon is located
in Nagpur, India. TBL was incorporated in 1982.





Until the
formation of Sricon, the infrastructure construction work was carried out in
Vijay Engineering Enterprises (partnership concern)
(“VEE”).  Sricon was incorporated with an objective to execute large
scale infrastructure projects in sectors such as Highways, Water Management
System, Power and Cement Plants, etc. In an effort to consolidate all
infrastructure activities under one company to garner better synergy, business
profile, as well as improve cost management, VEE was merged with Sricon
effective March 31, 2004.





Company
Overview





We are a
construction and materials company engaged in the following core business areas:
1) civil construction of roads and highways, 2) the construction and maintenance
of high temperature cement and steel plants, 3) operations and supply of rock
aggregate and 4) the export of iron ore to China.   Our present
and past clients include various Indian government
organizations.   Including our subsidiaries, we have
approximately 800 employees and contractors.  Our larger construction
subsidiary, Sricon, has the capacity and prior experience to bid on contracts
priced at a maximum of about $116 million.  We are focused on winning
construction contracts, building out rock aggregate quarries and setting up
relations and export hubs for the export of iron ore to
China.




The
Indian government has articulated plans to modernize the Indian
Infrastructure.  It expects to spend around $21 billion in the next 12
months on infrastructure. We believe that these initiatives will continue to be
favorable to our business.  Our model is three fold: 1) we bid on
construction and engineering contracts which provide us with a backlog which
translates into greater revenues and earnings, 2) we are in the process of
building rock quarries and selling rock aggregate to the infrastructure industry
and 3) we export iron ore to China.  There is seasonality in our
business as outdoor construction activity slows down during the Indian
monsoons.  The rains typically last intermittently from June through
September.




17
 Table of Contents




Industry
Overview




The
Indian GDP surpassed $1 Trillion in fiscal 2007.  According to the
World Bank, only nine economies at the close of 2005 generated more than $1
Trillion in GDP.  India’s growth rates have been ranging from 6.2% to
8.5% since 2003 and peaked at 9.2% in fiscal year ending March 31,
2007.  The GDP growth rate for 2008 was 7.9%.  The Indian
stock markets experienced significant growth with the SENSEX peaking at 21,000
(January 8, 2008).   The current global financial crisis created
a liquidity crunch starting in October 2008.





India’s
GDP growth for fiscal year end March 31, 2008 was 8.6% and for fiscal year end
March 31, 2009 is estimated around 5.8%.  The slowing of the GDP was
caused by the global financial crisis. However, it does indicate that India has
withstood the global downturn better than many nations. The factors contributing
to maintaining the relatively high growth included growth in the agriculture and
service industries, favorable demographic dynamics (India has a large youth
population that exceeds 550 Million), the savings rate and spending habits of
the Indian middle class.  Other factors are attributed to changing
investment patterns, increasing consumerism, healthy business confidence,
inflows of foreign investment (India ranks #2 behind China in the A.T. Kearney
“FDI Confidence Index” for 2007) and improvements in the Indian banking
system.  Meanwhile, several economists are forecasting India’s GDP
growth rate during the current fiscal year ending March 31, 2010 to be around
6%.





To
sustain India’s fast growing economy, the share of infrastructure investment in
India is expected to increase to 9 per cent of GDP by 2014, which is an
increase from 5 per cent in 2006-07.  This forecast is based on The
Indian Planning Commission’s annual publication that for the Eleventh Plan
period (2007-12), a large investment of approximately $494 Billion is
required for Infrastructure build out and modernization.  This
industry is one of the largest employers in the country – the construction
industry alone employs more than 30 million people.  According to the
Business Monitor International (BMI), by 2012, the construction industry’s
contribution to India’s GDP is forecasted to be 16.98%.





This
ambitious infrastructure development mandate by the Indian Government will
require funding.  The Government of India has already raised funds
from multi-lateral agencies such as the World Bank and the Asian Development
Bank.   The India Infrastructure Company was set up to support
projects by guaranteeing up to  $2 Billion annually.  In
addition, the Indian Government has identified public-private partnerships (PPP)
as the cornerstone of its infrastructure development policy.  The
government is also proactively seeking additional FDI and approval is not
required for up to 100% of FDI in most infrastructure
areas.  According to Indian Prime Minister Dr. Manmohan Singh,
addressing the Finance Ministers of ASEAN countries, at the Indo ASEAN Summit at
New Delhi, in August 2007, India needs  $150 billion at the rate of
$15 billion per annum for the next 10 years.  Speaking to the media in
November of 2007, Indian commerce minister Kamal Nath added:  "Our FDI
policy is perhaps one of the most liberal in the world, India remains a favorite
FDI destination despite what is going on in the stock market."





Previously,
Minister Nath said the government had fixed an ambitious $30 billion Foreign
Direct Investment (FDI) target for the country's 2007-08 financial year (April
to March) following total inflows in 2006-07 of $19.5 billion (or $16B
excluding reinvested earnings) compared with $7.7 billion in
2005-06.  Actual FDI for 2007-08 surged past $25
Billion.  With the exception of Japan, the focus and expected growth
of infrastructure in India has made it a leading FDI destination within
Asia in terms of private equity.  Eight of the Lipper's world's
top ten infrastructure funds in 2007 were Indian equity
funds.  However, in comparison, China received $67 billion in FDI,
while India received only $16B.  More than 50% of India’s
FDI will be utilized for infrastructure, telecom, and power.





The
Government of India is also permitting External Commercial Borrowings (ECB’s) as
a source of financing Indian Companies looking to expand existing
capacity as well as incubation for new startups.   ECB’s 
include commercial bank loans, buyers' credit, suppliers' credit, securitized
instruments such as Floating Rate Notes and Fixed Rate Bonds, credit from
official export credit agencies, and commercial borrowings from private sector
Multilateral Financial Institutions such as International Finance Corporation
(Washington), ADB, AFIC, CDC, etc.  National credit policies seek to
keep an annual cap or ceiling on access to ECB, consistent with prudent debt
management.   Also, these policies seek to encourage greater
emphasis on infrastructure projects and core sectors such as power,
oil exploration, telecom, railways, roads & bridges, , ports, industrial
parks, urban infrastructure, and  fosters exporting.  Applicants will
be free to raise ECB from any internationally recognized source such as banks,
export credit agencies, suppliers of equipment, foreign collaborators, foreign
equity-holders, and international capital markets.





ECB can
be accessed in two methods, namely, the Automatic Route and the Approval
Route. The Automatic Route is primarily for investment in Indian
infrastructure, and will not require Reserve Bank of India (RBI)/Government
approval. The maximum amount of ECB’s under the Automatic Route raised by an
eligible borrower is limited to $500 million during any financial year. The
following are additional requirements under the Automatic route:





a) ECB up
to $20 million or equivalent with minimum average maturity of 3
years.


b) ECB
above $20 million and up to $500 million or equivalent with minimum average
maturity of 5 years.





Some of
the areas where ECB’s are utilized is the National Highway Development Project
and the National Maritime Development Program.  In addition, the
following represent some of the major infrastructure projects planned for the
next five years:




1.
            Constructing
      dedicated freight corridors between Mumbai-Delhi and
      Ludhiana-Kolkata.




2.
            Capacity
      addition of 485 million MT in Major Ports, 345 million MT in Minor
      Ports.




3.
            Modernization
      and redevelopment of 21 railway
stations.




4.
            Developing
      16 million hectares through major, medium and minor irrigation
      works.




5.
            Modernization
      and redevelopment of 4 metro and 35 non-metro
  airports.




6.
            Expansion
      to six-lanes 6,500 km (4,038 Miles) of Golden Quadrilateral and selected
      National Highways.




7.
            Constructing
      228,000 miles of new rural roads, while renewing and upgrading the
      existing 230,000 miles covering 78,304 rural
    habitations.





18
 Table of Contents





Pro
Forma and Adjusted Pro Forma Financial Information




In
prior annual filings, we compared annual consolidated results of operations and
cash flows to the preceding year.   Since we acquired both TBL
and Sricon at the close of year ending March 31, 2008, we believe a comparison
of the December 31, 2009 consolidated results of operations and cash flows to
March 31, 2008 is not an adequate comparison.  Only the operating
results for March 8, 2008 to March 31, 2008 are included in our 2008
consolidated results of operations and cash flows.  To reflect a
better comparison of operating results, we are presenting in this Management’s
Discussion and Analysis section, the Pro Forma results of operations for the
Company  as if the acquisitions occurred on Apri11, 2007 and April 1,
2008, respectively.  We are basing our Pro Forma results of operations
from (1) the audited financial statements of Sricon for the period ended March
7, 2008, (2) the unaudited financial statements of Sricon for the period March
8, 2008 to March 31, 2008, (3) the audited financial statements of TBL for the
period ended March 7, 2008, (4) the unaudited financial statements of TBL for
the period March 8, 2008 to March 31, 2008, and (5) the audited consolidated
financial statements of the Company for the year ended March 31, 2009 and
2008.





We
believe that the presented Pro Forma financial statements and analysis is a more
meaningful comparison of our operating results.




The
following tables represent our Pro Forma Consolidated Financial
Statements.








India
Globalization Capital, Inc.


Adjusted
Pro Forma Consolidated Statements of Operations


(unaudited)





Year
      Ended
                                    March 31,
      2009
                                  
                                  
                                  Year
      Ended
                                    March
      31, 2008
                                  
                                  
                                  Percentage
      Increase (Decrease)Revenue
                                  
                                  $
                                  35,338,725
                                  
                                  
                                  $
                                  30,123,348
                                  
                                  
                                  $
                                  17.3
                                  %Cost
      of revenue
                                  
                                  
                                  (27,179,494
                                  )
                                  
                                  
                                  (22,462,592
                                  )
                                  
                                  
                                  21.0
                                  %Gross
      profit
                                  
                                  
                                  8,159,231
                                  
                                  
                                  
                                  7,660,756
                                  
                                  
                                  
                                  6.5
                                  %Selling,
      general and administrative expenses
                                  
                                  
                                  (4,977,815
                                  )
                                  
                                  
                                  (2,997,983
                                  )
                                  
                                  
                                  66.0
                                  %Depreciation
                                  
                                  
                                  (873,022
                                  )
                                  
                                  
                                  (921,382
                                  )
                                  
                                  
                                  (5.2
                                  %)Operating
      income
                                  
                                  
                                  2,308,394
                                  
                                  
                                  
                                  3,741,392
                                  
                                  
                                  
                                  (38.3
                                  %)Legal
      and formation, travel and other start up costs
                                  
                                  
                                  
                                  
                                  
                                  
                                  (5,765,620
                                  )
                                  
                                  
                                  (100.0
                                  %)Interest
      expense
                                  
                                  
                                  (1,753,952
                                  )
                                  
                                  
                                  (3,411,357
                                  )
                                  
                                  
                                  48.6
                                  %Interest
      income
                                  
                                  
                                  1,176,018
                                  
                                  
                                  
                                  319,984
                                  
                                  
                                  
                                  267.5
                                  %Other
      Income
                                  
                                  
                                  
                                  
                                  
                                  
                                  2,997,495
                                  
                                  
                                  
                                  (100.0
                                  %)Income
      / (loss) before income taxes
                                  
                                  
                                  1,730,461
                                  
                                  
                                  
                                  (2,118,106
                                  )
                                  
                                  
                                  (181.7
                                  %)Provision
      for income taxes, net
                                  
                                  
                                  (1,535,087
                                  )
                                  
                                  
                                  (946,939
                                  )
                                  
                                  
                                  (62.1
                                  %)Income
      after Income Taxes
                                  
                                  
                                  195,373
                                  
                                  
                                  
                                  (3,065,046
                                  )
                                  
                                  
                                  106.4
                                  %Provision
      for Dividend on Preference Stock and its TaxMinority
      interest
                                  
                                  
                                  (716,950
                                  )
                                  
                                  
                                  (1,343,845
                                  )
                                  
                                  
                                  46.6
                                  %Net
      income / (loss)
                                  
                                  $
                                  (521,576
                                  )
                                  
                                  $
                                  (4,408,891
                                  )
                                  
                                  $
                                  88.2
                                  %Net
      income / (loss) per share: basic and diluted
                                  
                                  $
                                  (0.05
                                  )Weighted
      average number of shares outstanding-basic and diluted
                                  
                                  
                                  10,091,171




Pro
Forma Adjustments


The
Consolidated Pro Forma Statement of Operations contains US GAAP to Pro Forma
adjustments consisting of the elimination of interest income held in trust and
provision for income taxes.  Had the merger occurred during April 1,
2007, interest income in the amount of $2,192,402 would not have been earned
because funds as reported in US GAAP results would have not been held in
trust.  Therefore, we eliminate the applicable interest earned from
the Pro Forma statement of operations for the year ended March 31,
2008.  Accordingly, the provision for income taxes is reduced by
$16,955.




19
 Table of Contents




Results
of Operations (IGC)




The
following discussion relates to IGC for the years ended March 31, 2009 and March
31, 2008:





Revenues


Total pro
forma revenue increased 17.1% from $35.3 million for the year ended March
31, 2009, as compared to $30.1 million for the year ended March 31,
2008.  Due to increased liquidity requirements in maintaining a high
level of growth, we have curtailed the number of contracts we are working on by
sub-contracting some and cancelling others.





Cost
of Revenues


Costs of
revenue consists primarily of compensation and related fringe benefits for
project-related personnel, department management and all other dedicated project
related costs and indirect costs. Cost of revenue increased by 4.7 million
or 21.0%, compared to the year ended March 31, 2008.  The increase was
due to the increase of construction material.




Selling,
General and Administrative Expenses


Consist
primarily of employee-related expenses, professional fees, other corporate
expenses and allocated overhead. Selling, general and administrative expenses
increased by $2 million or 67.5% for the year ended March 31, 2009,
compared to the year ended March 31, 2008.  The increase in SG&A
stem partly from overheads related to US compliance, USGAAP filings with the
SEC, and legal costs associated with the warrant tender offer and general fund
raising activity.




Net Interest Income (Expense)
– Net interest expense increased by $484 thousand for the year ended March
31, 2009 compared to the year ended March 31, 2008.  The main reason
is that the interest income from money in trust is not included in the pro forma
statements.




Net
Income (loss)


Net loss
for the years ended March 31, 2009 and March 31, 2008 was $522 thousand and $4.4
million, respectively.  The 2008 net loss included compensation
expense, legal, interest expense, formation, travel, other and start-up
costs net of interest income related to the cash held in our trust
account.  The 2009 loss includes approximately $1.5 million of one
time expenses related to fund raising and non cash expenses related to warrants,
as well as approximately $300,000 of losses due to a strengthening US dollar
against the Indian Rupee.





Impairment
of Goodwill


As a
result of our annual impairment tests which occurred during the fourth quarter,
we have not recorded an impairment adjustment to goodwill.  Factors
that influence the analysis include, contracts, potential contracts, ability to
grow the quarry and ore business, among others.   While there is
an overall liquidity constraint and we require more cash to grow, the market
potential for the infrastructure business in India remains
unabated.





Liquidity
and Capital Resources




This liquidity and capital resources
discussion compares the consolidated company results for the years ended March
31, 2009 and 2008.




Cash used
for operating activities from continuing operations is net loss adjusted for
certain non-cash items and changes in operating assets and
liabilities.  During the year ending March 31, 2009, cash used for
operating activities was $8.1 million compared to cash used for operating
activities of $8.6 million during the year ended March 31, 2008.  The
uses of cash during the year ended March 31, 2009 relates primarily to the
payment of general operating expenses of our subsidiary companies, down payments
on equipment and one time expenses related to legal costs associated with the
warrant tender offer, increased fundraising activities, and increased expenses
in curtailing contracts.




During
the year ended March 31, 2009, investing activities from continuing operations
provided approximately $2.9 million of cash as compared to approximately $ 57.3
million used during the year of 2008.  The large difference of cash
stems from our cash in escrow during the FYE 2008.   During this
period we were a Special Purpose Acquisition Company for the majority of the
year with no operations.  Therefore, cash was invested in treasury
bills and notes earning interest on cash held in trust.




During
the year ended March 31, 2009, there was cash financing used of approximately
$156 thousand, compared to cash used of approximately $ 41.4 million for the
year ended March 31, 2008.  The significant use of cash in 2008 was for
acquisition costs related to the acquisition of TBL and Sricon. We paid off $5.5
million in bank lines and notes outstanding during the year ended March 31,
2009.




Our
future liquidity needs will depend on, among other factors, stability of
construction costs, interest rates, and a continued increase in infrastructure
contracts in India.  We believe that our current cash balances,
anticipated operating cash flow, and potential cash from claims are adequate to
sustain the Company, but not to fuel rapid growth commensurate with the
opportunity before us.  As such we have and continue to take measures
to constrain growth until we have visibility into increased
liquidity.  As of now our bank lines in India have been dramatically
reduced to amounts borrowed and outstanding.  We continue to explore
funding sources including negotiated settlement of accounts receivable,
settlement of claims, bank lines, equity, Mauritius listing of our stock,
convertible debentures, and debt. However, there can be no assurance that we
will be able to access additional credit facilities.  Our strategy is
to use develop businesses that have a very short receivable cycle like the
export of ore to China and the sale of rock aggregate as well as aggressively
collect our outstanding receivables and claims.




20
 Table of Contents




Off
Balance Sheet Arrangements




Item 7A.       Quantitative and
Qualitative Disclosure about Market Risks





The
primary objective of the following information is to provide forward-looking
quantitative and qualitative information about our potential exposure to market
risks.  Market risk is the sensitivity of income to changes in
interest rates, foreign exchanges, commodity prices, equity prices, and other
market-driven rates or prices.  The disclosures are not meant to be
precise indicators of expected future losses, but rather, indicators of
reasonably possible losses.  This forward-looking information provides
indicators of how we view and manage our ongoing market risk
exposures.




Customer
Risk





The
Company’s customers are the Indian government, state government, private
companies and Indian government owned companies.   Therefore, our
business requires that we continue to maintain a pre-qualified status with our
clients so we are not disqualified from bidding on future
work.  The loss of a significant client, like the National Highway
Authority of India (NHAI), may have an adverse effect on
Company.  Disqualification can occur if, for example, we run out of
capital to finish contracts that we have undertaken.





Commodity
Prices and Vendor Risk





The
Company is affected by the availability, cost and quality of raw materials
including cement, asphalt, steel, rock aggregate and
fuel.    The prices and supply of raw materials and fuel
depend on factors beyond the control of the Company, including general economic
conditions, competition, production levels, transportation costs and import
duties.  The Company typically builds contingencies into the
contracts, including indexing key commodity prices into escalation
clauses.  However, drastic changes in the global markets for raw
material and fuel could affect our vendors, which may create disruptions in
delivery schedules that could affect our ability to execute contracts in a
timely manner.  We are taking steps to mitigate some of this risk by
attempting to control the supply of raw materials.    We do
not currently hedge commodity prices on capital markets.





Labor
Risk





The
building boom in India and the Middle East (India, Pakistan, and Bangladesh
export labor to the Middle East) had created pressure on the availability of
skilled labor like welders, equipment operators, etc.  While this has
recently changed with the shortage of financial liquidity and falling oil
prices, we expect a construction boom and although manageable, some regional
shortage of skilled labor.





Compliance,
Legal and Operational Risks





We
operate under regulatory and legal obligations imposed by the Indian
governments and U.S. securities regulators.  Those obligations
relate, among other things, to the company’s financial reporting, trading
activities, capital requirements and the supervision of its
employees.   For example, we file our financial statements in
three countries under three different Generally Accepted Accounting Standards,
(GAAP).  Failure to fulfill legal or regulatory obligations can lead
to fines, censure or disqualification of management and/or staff and other
measures that could have negative consequences for Sricon’s activities and
financial performance. We are mitigating this risk by hiring local consultants
and staff who can manage the compliance in the various jurisdictions in which we
operate.  However, the cost of compliance in various jurisdictions
could have an impact on our future earnings.




Interest
Rate Risk




The
infrastructure development industry is one in which leverage plays a large
role. A typical contract requires that we furnish an earnest money
deposit and a performance guaranty.  Furthermore, most contracts
demand that we reserve between 7 and 11 percent of contract value in the form of
bank guaranties and/or deposits.  Finally, as interest rates rise, our
cost of capital increases thus impacting our margins.





Exchange
Rate Sensitivity





Our
Indian subsidiaries conduct all business in Indian Rupees with the exception of
foreign equipment that is purchased from the U.S. or Europe.  Exchange
rates have an insignificant impact on our financial results.  However,
as we convert from Indian Rupees to USD and subsequently report in U.S. dollars,
we may see an impact on translated revenue and
earnings.  Essentially, a stronger USD decreases our reported earnings
and a weakening USD increases our reported earnings.




Accounting
Developments and their impact





In
September 2006, FASB issued FAS No. 158, “Employers’ Accounting for Defined
Benefit Pension and Other Postretirement Benefit Plans” (FAS 158). This
Statement requires companies to recognize the over-funded or under-funded status
of a defined benefit postretirement plan as an asset or liability in its
statement of financial position. The Company has applied FAS 158, and there is
no impact on the financial statements.





In May
2005, FASB issued FAS No. 154, “Accounting Changes and Error Corrections-a
replacement of APB Opinion No. 20 and FASB Statement No. 3” (FAS 154). This
Statement replaces APB Opinion No. 20, “Accounting Changes,” and FASB Statement
No. 3, “Reporting Accounting Changes in Interim Financial Statements.” This
Statement requires retrospective application to prior periods’ financial
statements for changes in accounting principle, unless it is impractical to
determine either the period-specific effects or the cumulative effect of the
change. FAS 154 also requires that a change in depreciation, amortization, or
depletion method for long, non-financial assets be accounted for as a change in
accounting estimate effected by a change in accounting principal. The Company
adopted FAS 154 for accounting changes and corrections of errors made after the
adoption date. The adoption of the provisions of FAS 154 did not have an impact
on the Company’s financial statements.




21
 Table of Contents




In
September 2006, the Securities and Exchange Commission (‘SEC’) staff issued
Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year
Misstatements when Quantifying Misstatements in Current Year Financial
Statements” (‘SAB 108’). SAB 108 provides guidance on how prior year
misstatements should be taken into consideration when quantifying misstatements
in current year financial statements for purposes of determining whether the
current year’s financial statements are materially misstated. The provisions of
SAB 108 are required to be applied by registrants in their annual financial
statements covering fiscal years ending on or before November 15, 2007. The
adoption of the provisions of SAB 108 did not have an impact on the Company’s
financial statements.





In June
2006, the FASB issued FASB Interpretation No. 48, “Accounting for Uncertainty in
Income Taxes—an interpretation of FASB Statement No. 109” (FIN 48). FIN 48
clarifies the accounting and reporting for uncertainties in income tax law. This
Interpretation prescribes a comprehensive model for the financial statement
recognition, measurement, presentation and disclosure of uncertain tax positions
taken or expected to be taken in income tax returns. The provisions of FIN 48
will be applied beginning in the first quarter of 2008 (i.e. from April 1,
2008), with the cumulative effect of the change in accounting principle recorded
as an adjustment to retained earnings. The Company is currently assessing the
impact of the adoption of this Interpretation on its financial
statements.




In
December 2007, the Financial Accounting Standards Board (FASB) issued SFAS No.
141 (revised 2007), “Business Combinations” (“SFAS 141R”).  SFAS 141R
establishes principles and requirements for how an acquirer recognizes and
measures in its financial statements the identifiable assets acquired, the
liabilities assumed, any noncontrolling interest in the acquiree and the
goodwill acquired.  SFAS 141R also establishes disclosure requirements
to enable the evaluation of the nature and financial effects of the business
combination.  This statement is effective beginning January 1,
2009.  The Company does not expect the adoption of SFAS 141R to have a
material impact on its financial position and results of operations.




In
December 2007, FASB issued SFAS No. 160, “Noncontrolling Interests in
Consolidated Financial Statements – an amendment of ARB No. 51.”  This
statement improves the relevance, comparability, and transparency of the
financial information that a reporting entity provides in its consolidated
financial statements by establishing accounting and reporting standards that
require; the ownership interests in subsidiaries held by parties other than the
parent and the amount of consolidated net income attributable to the parent and
to the noncontrolling interest be clearly identified and presented on the face
of the consolidated statement of income, changes in a parent’s ownership
interest while the parent retains its controlling financial interest in its
subsidiary be accounted for consistently, when a subsidiary is deconsolidated,
any retained noncontrolling equity investment in the former subsidiary be
initially measured at fair value, entities provide sufficient disclosures that
clearly identify and distinguish between the interests of the parent and the
interests of the noncontrolling owners.  SFAS 160 affects those
entities that have an outstanding noncontrolling interest in one or more
subsidiaries or that deconsolidate a subsidiary.  SFAS 160 is
effective for fiscal years, and interim periods within those fiscal years,
beginning on or after December 15, 2008. Early adoption is
prohibited.  The adoption of this statement did not have a material
effect on the Company's financial statements.




In March
2008, the FASB issued SFAS No. 161, “Disclosures about Derivative
Instruments and Hedging Activities, an amendment of FASB Statement
No. 133.”  This statement is intended to improve transparency in
financial reporting by requiring enhanced disclosures of an entity’s derivative
instruments and hedging activities and their effects on the entity’s financial
position, financial performance, and cash flows.  SFAS 161 applies to
all derivative instruments within the scope of SFAS 133, “Accounting for
Derivative Instruments and Hedging Activities” (SFAS 133) as well as related
hedged items, bifurcated derivatives, and nonderivative instruments that are
designated and qualify as hedging instruments.  Entities with
instruments subject to SFAS 161 must provide more robust qualitative disclosures
and expanded quantitative disclosures.  SFAS 161 is effective
prospectively for financial statements issued for fiscal years and interim
periods beginning after November 15, 2008, with early application
permitted.  The adoption of this statement did not have a material
effect on the Company's financial statements.




In May
2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted
Accounting Principles.” SFAS 162 identifies the sources of accounting principles
and the framework for selecting the principles used in the preparation of
financial statements of nongovernmental entities that presented in conformity
with generally accepted accounting principles in the United States of
America.  SFA 162 will be effective 60 days following the SEC’s
approval of the PCAOB amendments to AU Section 411, The Meaning of Present Fairly in
Conformity With Generally Accepted Accounting Principles.The
Company does not believe SFAS 162 will have a significant impact on the
Company’s financial statements.




In May
2008, the FASB issued SFAS No. 163, “Accounting for Financial Guarantee
Insurance Contracts, an interpretation of FASB Statement No. 60.”  The
scope of this Statement is limited to financial guarantee insurance and
reinsurance contracts, as described in the Statement, issued by enterprises
included within the scope of Statement 60.  Accordingly, this
Statement does not apply to financial guarantee contracts issued by enterprises
excluded from the scope of Statement 60 or to some insurance contracts that seem
similar to financial guarantee insurance contracts issued by insurance
enterprises (such as mortgage guaranty insurance or credit insurance on trade
receivables).  This Statement also does not apply to financial
guarantee contracts that are derivative instruments included within the scope of
SFAS No. 133, “Accounting for Derivative instruments and Hedging
Activities.”  SFAS 163 is effective prospectively for financial
statements issued for fiscal years beginning after December 15, 2008, and
interim periods within those fiscal years; disclosure requirements in paragraphs
30(g) and 31 are effective for the first period (including interim periods)
beginning after May 23, 2008. The adoption of this statement did not have a
material effect on the Company's financial statements.




In
September 2006, the FASB issued FAS No.157, “Fair Value Measurements” (FAS No.
157). FAS No. 157 clarifies the principle
that fair value should be based on the assumptions market participants would use
when pricing an asset or liability and
establishes a fair value hierarchy that prioritizes the information used to
develop those assumptions. The Company’s adoption
of this Standard on January 1, 2008 did not have a material effect on its
financial statements. Relative to FAS 157, the FASB issued FASB Staff Positions
(FSP) FAS 157-1, FAS 157-2, and FAS 157-3. FSP FAS 157-1 amends SFAS 157 to
exclude SFAS No. 13,“Accounting for Leases” (SFAS 13), and its related
interpretive accounting pronouncements that address leasing transactions, while
FSP FAS 157-2 delays the effective date of the application of SFAS 157 to fiscal
years beginning after November 15, 2008 for all nonfinancial assets and
nonfinancial liabilities that are recognized or disclosed at fair value in the
financial statements on a non-recurring basis. FSP FAS 157-3 clarifies the
application of FAS 157 as it relates to the valuation of financial assets in a
market that is not active for those financial assets. This FSP is effective
immediately and includes those periods for which financial statements have not
been issued. We currently do not have any financial assets that are valued using
inactive markets, and as such are not impacted by the issuance of this
FSP.




22
 Table of Contents





In
February 2007, the FASB issued FAS No. 159, “The Fair Value Option for Financial
Assets and Financial Liabilities— Including
an amendment of FASB Statement No. 115” (FAS No. 159). FAS No. 159 provides
companies with a choice to measure
certain financial assets and liabilities at fair value that are not currently
required to be measured at fair value (the “Fair
Value Option”). Election of the Fair Value Option is made on an
instrument-by-instrument basis and is irrevocable. The Company’s adoption of
this Standard on January 1, 2008 did not have a material effect on its financial
statements.





Critical
Accounting Policies





The
preparation of financial statements in conformity with U.S. GAAP requires the
Company to make estimates and judgments that affect the reported amounts of
assets and liabilities, disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amount of revenues and
expenses during the reporting period. Both our Indian subsidiaries
have based their estimates and judgments on experience and other
assumptions that they find reasonable.  Actual results may differ from such
estimates as conditions and assumptions change, which could have a material
impact on the financial statements.





Accounting
standards whose application may have a significant effect on the reported
results of operations and financial position,
and that can require judgments by management that affect their application,
include FAS No. No. 5, “Accounting for Contingencies,” FAS No. 144, “Accounting
for the Impairment or Disposal of Long-Lived Assets,” FAS No. 142, “Goodwill and
Other Intangible Assets,” FAS No. 157, “Fair Value Measurements,” FAS No. 159,
“The Fair Value Option for Financial Assets and Financial Liabilities,” and FAS
No. 109, “Accounting for Income Taxes,” including recent accounting requirements
under FASB Interpretation No. 48 (FIN 48), “Accounting for Uncertainty in Income
Taxes.”





Partial revenue is recognized on major
construction contracts when work is completed, an independent consultant
approves the work and a bill is retendered.   The timing of
revenue recognition is dependent upon the agreement between the customer and the
Company.  Specifically, revenue recognized from
construction, project related activities, contracts for supply, plant and
equipment commissioning is recognized as follows:




a)
            
            Cost
      plus contracts: Contract revenue is determined by adding the aggregate
      cost plus proportionate margin as agreed with the customer and expected to
      be realized.b)
            
            Fixed
      price contracts: Contract revenue is recognized using the percentage
      completion method. Percentage of completion is determined as a proportion
      of cost incurred-to-date to the total estimated contract cost. Changes in
      estimates for revenue, costs to complete and profit margins are recognized
      in the period in which they are reasonably
  determinable





Revenue
from property development activity is recognized when all significant risks and
rewards of ownership in the land and/or building are transferred to the customer
and a reasonable expectation of collection of the sale consideration from the
customer exists.




Revenue
from service related activities and miscellaneous other contracts are recognized
when the service is rendered using the proportionate completion method or
completed service contract method.





Revenue
from mining and trading activity is typically recognized, based on contracts
that are “Freight on Board” (FOB), when a shipment is loaded on to a
ship.





Full
provision is made for any loss in the period in which it is
foreseen.  If the financial conditions of the Company’s customers were
to deteriorate, resulting in an impairment of their ability to make payments,
additional provisions may be required.





Foreign
Currency Translation


IGC
mainly operates in India and a substantial portion of the Company’s sales are
denominated in the Indian Rupee.   As a result, changes in the
relative values of the U.S. dollar and Indian Rupee affect revenues and profits
as the results are translated into U.S. dollars in the consolidated and Pro
Forma financial statements.




The
accompanying financial statements are reported in U.S. dollars. The Indian rupee
is the functional currency for the company. The translation of the functional
currencies into U.S. dollars is performed for assets and liabilities using the
exchange rates in effect at the balance sheet date and for revenues, costs and
expenses using average exchange rates prevailing during the reporting periods.
Adjustments resulting from the translation of functional currency financial
statements to reporting currency are accumulated and reported as other
comprehensive income/(loss), a separate component of shareholders’
equity.





The
exchange rates used for translation purposes are as under:




Year
                        
                        Month
      end Average Rate (P&L rate)
                        
                        Year
      end rate (Balance sheet rate)2005-06
                        
                        INR
      44.18 per USD
                        
                        INR
      44.48 per USD2006-07
                        
                        INR
      45.11 per USD
                        
                        INR
      43.10 per USD2007-08
                        
                        INR
      40.13 per USD
                        
                        INR
      40.42 per USD2008-09
                        
                        INR
      46.49 per USD
                        
                        INR
      50.64 per
USD




Item 8.         
Financial Statements and Supplementary Data





Our
Consolidated Financial Statements and supplementary financial data are included
in this annual report on Form 10-K beginning on page F-1






23
 Table of Contents










INDEX
TO FINANCIAL STATEMENTS




PageIndia
      Globalization Capital, Inc.Report of Independent Registered
      Public Accounting Firm
            F-1Consolidated
      Balance Sheets – FYE 2009 and 2008
            F-2Consolidated
      Statements of Income (Loss) -For FYE 2009 and 2007
            F-3Consolidated
      Statements of Changes in Stockholder’s Equity - For FYE 2009 and
      2008
            F-4Consolidated
      Statements of Cash Flows - For FYE 2009 and 2008
            F-5Notes to Consolidated Financial
      Statements
            F-6













i
 Table of Contents






REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM





To the
Board of Directors and Stockholders


India
Globalization Capital, Inc.







In our
opinion, the accompanying consolidated balance sheets and the related
consolidated statements of operations, shareholders' equity and comprehensive
loss, and of cash flows present fairly, in all material respects, the financial
position of India Globalization Capital, Incorporated and its subsidiaries at
March 31, 2009 and 2008, and the results of their operations and their cash
flows for each of the two years in the period ended March 31, 2009 in conformity
with accounting principles generally accepted in the United States of America.
These financial statements are the responsibility of the Company’s management.
Our responsibility is to express an opinion on these financial statements based
on our audits. We conducted our audits of these statements in accordance with
the standards of the Public Company Accounting Oversight Board (United States).
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.






/s/ Yoganandh &
Ram


Independent
Auditors registered with


Public
Company Accounting Oversight Board (USA)









F-1
 Table of Contents




India
Globalization Capital, Inc.


CONSOLIDATED
BALANCE SHEET




March 31,
                                    2009
                                  
                                  
                                  March 31,
                                    2008ASSETSCurrent
      Assets:Cash
      and cash equivalents
                                  
                                  $
                                  2,129,365
                                  
                                  
                                  $
                                  8,397,441Accounts
      Receivable
                                  
                                  
                                  9,307,088
                                  
                                  
                                  
                                  8,708,861Unbilled
      Receivables
                                  
                                  
                                  2,759,632
                                  
                                  
                                  
                                  5,208,722Inventories
                                  
                                  
                                  2,121,837
                                  
                                  
                                  
                                  1,550,080Interest
      Receivable - Convertible Debenture
                                  
                                  
                                  
                                  
                                  
                                  
                                  277,479Convertible
      debenture in MBL
                                  
                                  
                                  
                                  
                                  
                                  
                                  3,000,000Prepaid
      taxes
                                  
                                  
                                  88,683
                                  
                                  
                                  
                                  49,289Restricted
      cash
                                  
                                  
                                  
                                  
                                  
                                  
                                  6,257Short
      term investments
                                  
                                  
                                  
                                  
                                  
                                  
                                  671Prepaid
      expenses and other current assets
                                  
                                  
                                  2,801,148
                                  
                                  
                                  
                                  4,324,201Due
      from related parties
                                  
                                  
                                  290,831
                                  
                                  
                                  
                                  1,373,446Total
      Current Assets
                                  
                                  
                                  19,498,584
                                  
                                  
                                  
                                  32,896,447Property
      and equipment, net
                                  
                                  
                                  6,601,394
                                  
                                  
                                  
                                  7,337,361Accounts
      Receivable – Long Term
                                  
                                  
                                  2,769,196
                                  
                                  
                                  
                                  3,519,965Goodwill
                                  
                                  
                                  17,483,501
                                  
                                  
                                  
                                  17,483,501Investment
                                  
                                  
                                  70,743
                                  
                                  
                                  
                                  1,688,303Deposits
      towards acquisitions
                                  
                                  
                                  261,479
                                  
                                  
                                  
                                  187,500Restricted
      cash, non-current
                                  
                                  
                                  1,430,137
                                  
                                  
                                  
                                  2,124,160Deferred
      tax assets - Federal and State, net of valuation allowance
                                  
                                  
                                  898,792
                                  
                                  
                                  
                                  1,013,611Other
      Assets
                                  
                                  
                                  2,818,687
                                  
                                  
                                  
                                  1,376,126Total
      Assets
                                  
                                  $
                                  51,832,513
                                  
                                  
                                  $
                                  67,626,973LIABILITIES
      AND STOCKHOLDERS’ EQUITYCurrent
      Liabilities:Short-term
      borrowings and current portion of long-term debt
                                  
                                  $
                                  3,422,239
                                  
                                  
                                  $
                                  5,635,408Trade
      payables
                                  
                                  
                                  462,354
                                  
                                  
                                  
                                  1,771,151Advance
      from Customers
                                  
                                  
                                  206,058
                                  
                                  
                                  
                                  931,092Accrued
      expenses
                                  
                                  
                                  555,741
                                  
                                  
                                  
                                  1,368,219Taxes
      payable
                                  
                                  
                                  76,569
                                  
                                  
                                  
                                  58,590Notes
      Payable to Oliveira Capital, LLC
                                  
                                  
                                  1,517,328
                                  
                                  
                                  
                                  3,000,000Due
      to related parties
                                  
                                  
                                  1,214,685
                                  
                                  
                                  
                                  1,330,291Other
      current liabilities
                                  
                                  
                                  1,991,371
                                  
                                  
                                  
                                  3,289,307Total
      current liabilities
                                  
                                  $
                                  9,446,345
                                  
                                  
                                  $
                                  17,384,059Long-term
      debt, net of current portion
                                  
                                  
                                  1,497,458
                                  
                                  
                                  
                                  1,212,841Advance
      from Customers
                                  
                                  
                                  
                                  
                                  
                                  
                                  832,717Deferred
      taxes on income
                                  
                                  
                                  590,159
                                  
                                  
                                  
                                  608,535Other
      liabilities
                                  
                                  
                                  2,440,676
                                  
                                  
                                  
                                  6,717,109Total
      Liabilities
                                  
                                  $
                                  13,974,638
                                  
                                  
                                  $
                                  26,755,261Minority
      Interest
                                  
                                  
                                  14,262,606
                                  
                                  
                                  
                                  13,545,656Common
      stock subject to possible conversion, 11,855,122 shares at conversion
      value
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -COMMITMENTS
      AND CONTINGENCYSTOCKHOLDERS’
      EQUITYPreferred
      stock $.0001 par value; 1,000,000 shares authorized; none issued and
      outstanding
                                  
                                  
                                  
                                  
                                  
                                  
                                  -Common
      stock — $.0001 par value; 75,000,000 shares authorized; 10,091,171 issued
                                    and
      outstanding at March 31, 2009 and 8,570,107 issued and outstanding at
      March 31, 2008.
                                  
                                  
                                  1,009
                                  
                                  
                                  
                                  857Additional
      paid-in capital
                                  
                                  
                                  33,186,530
                                  
                                  
                                  
                                  31,470,134Retained
      Earnings (Deficit)
                                  
                                  
                                  (4,662,689
                                  )
                                  
                                  
                                  (4,141,113
                                  )Accumulated
      other comprehensive (loss) income
                                  
                                  
                                  (4,929,581
                                  )
                                  
                                  
                                  (3,822
                                  )Total
      stockholders’ equity
                                  
                                  
                                  23,595,269
                                  
                                  
                                  
                                  27,326,056Total
      liabilities and stockholders’ equity
                                  
                                  $
                                  51,832,513
                                  
                                  
                                  $
                                  67,626,973




The
accompanying notes should be read in connection with the financial
statements.






F-2
 Table of Contents




India
Globalization Capital, Inc.


CONSOLIDATED
STATEMENTS OF OPERATIONS





Year
      Ended
                            March 31,
      2009
                          
                          
                          Year
      Ended
                            March
      31, 2008Revenue
                          
                          $
                          35,338,725
                          
                          
                          $
                          2,188,018Cost
      of revenue
                          
                          
                          (27,179,494
                          )
                          
                          
                          (1,783,117
                          )Gross
      profit
                          
                          
                          8,159,231
                          
                          
                          
                          404,901Selling,
      general and administrative expenses
                          
                          
                          (4,977,815
                          )
                          
                          
                          (367,647
                          )Depreciation
                          
                          
                          (873,022
                          )
                          
                          
                          (58,376
                          )Operating
      income
                          
                          
                          2,308,394
                          
                          
                          
                          5,153Legal
      and formation, travel and other start up costs
                          
                          
                          
                          
                          
                          
                          (5,765,620
                          )Interest
      expense
                          
                          
                          (1,753,952
                          )
                          
                          
                          (1,944,660
                          )Interest
      income
                          
                          
                          1,176,018
                          
                          
                          
                          2,213,499Other
      Income
                          
                          
                          
                          
                          
                          
                          202,858Income
      / (loss) before income taxes
                          
                          
                          1,730,461
                          
                          
                          
                          (5,315,044
                          )Provision
      for income taxes, net
                          
                          
                          (1,535,087
                          )
                          
                          
                          (76,089
                          )Income
      after Income Taxes
                          
                          
                          195,373
                          
                          
                          
                          (5,391,134
                          )Provision
      for Dividend on Preference Stock and its Tax
                          
                          
                          
                          
                          
                          
                          171,084Minority
      interest
                          
                          
                          (716,950
                          )
                          
                          
                          4,780Net
      income / (loss)
                          
                          $
                          (521,576
                          )
                          
                          $
                          (5,215,270
                          )Net
      income / (loss) per share: basic and diluted
                          
                          $
                          (0.05
                          )
                          
                          $
                          (0.61
                          )Weighted
      average number of shares outstanding-basic and diluted
                          
                          
                          10,091,171
                          
                          
                          
                          8,570,107





The
accompanying notes should be read in connection with the financial
statements.








India Globalization
Capital, Inc.


CONSOLIDATED
STATEMENTS OF COMPREHENSIVE INCOME





Year
      Ended
                      March 31,
      2009
                    
                    
                    Year
      Ended
                      March
      31, 2008Net
      income / (loss)
                    
                    $
                    (521,576
                    )
                    
                    $
                    (5,215,270
                    )Foreign
      currency translation adjustments
                    
                    
                    (4,925,759
                    )
                    
                    
                    (3,822
                    )Comprehensive
      income (loss)
                    
                    $
                    (5,447,335
                    )
                    
                    $
                    (5,219,092
                    )





The
accompanying notes should be read in connection with the financial
statements.





F-3
 Table of Contents




India
Globalization Capital, Inc.


CONSOLIDATED
STATEMENT OF STOCKHOLDERS’ EQUITY




Common
      Stock
                                                            
                                                            Additional
                                                              Paid-in
                                                            
                                                            Accumulated
                                                              Earnings
                                                            
                                                            
                                                            Accumulated
                                                              Other
                                                              Comprehensive
      Income
                                                            
                                                            Total
                                                              Stockholders'Shares
                                                            
                                                            Amount
                                                            
                                                            Capital
                                                            
                                                            (Deficit)
                                                            
                                                            
                                                            /
      Loss
                                                            
                                                            EquityBalance
      at April 1, 2007
                                                            
                                                            13,974,500
                                                            
                                                            $
                                                            1,397
                                                            
                                                            $
                                                            51,848,145
                                                            
                                                            $
                                                            1,074,157
                                                            
                                                            $
                                                            
                                                            
                                                            $
                                                            52,923,699Redemption
      of 1,910,469 shares on March 7, 2008 and balance in shares subject to
      possible conversion transferred to paid in capital
                                                            
                                                            (1,910,469)
                                                            
                                                            
                                                            (191)
                                                            
                                                            
                                                            1,689,164
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            1,688,973Buyback
      of 4,248,877 shares on March 7, 2008
                                                            
                                                            (4,248,877)
                                                            
                                                            
                                                            (425)
                                                            
                                                            
                                                            (25,237,905
                                                            )
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            (25,238,330
                                                            )"Issuance
      of common stock to Bridge Investors at $.01 per share
                                                            
                                                            754,953
                                                            
                                                            
                                                            76
                                                            
                                                            
                                                            3,170,730
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            3,170,805Net
      Loss for the year
                                                            
                                                            -
                                                            
                                                            
                                                            -
                                                            
                                                            
                                                            -
                                                            
                                                            
                                                            (5,215,270
                                                            )
                                                            
                                                            (3,822
                                                            )
                                                            
                                                            (5,219,091
                                                            )Balance
      at March 31, 2008
                                                            
                                                            8,570,107
                                                            
                                                            $
                                                            857
                                                            
                                                            $
                                                            31,470,134
                                                            
                                                            $
                                                            (4,141,113
                                                            )
                                                            $
                                                            (3,822
                                                            )
                                                            $
                                                            27,326,056Fair
      value of 425,000 warrants issued to Oliveira Capital, LLC
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            403,750
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            403,750Issuance
      of common stock to RedChip Companies at $4.71 per share
                                                            
                                                            10,000
                                                            
                                                            
                                                            1
                                                            
                                                            
                                                            47,098
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            47,099Fair
      value of 200,000 common stock issued to Oliveira Trust
                                                            
                                                            200,000
                                                            
                                                            
                                                            20
                                                            
                                                            
                                                            967,980
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            968,000Conversion
      of Warrants to Equity shares – 1,311,064 shares
                                                            
                                                            1,311,064
                                                            
                                                            
                                                            131
                                                            
                                                            
                                                            297,568
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            297,699Net
      income / (Loss)
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            (521,576
                                                            )
                                                            
                                                            
                                                            
                                                            
                                                            (521,576
                                                            )Foreign
      currency translation adjustments
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            
                                                            (4,925,759
                                                            )
                                                            
                                                            (4,925,759
                                                            )Balance
      at March 31, 2009
                                                            
                                                            10,091,171
                                                            
                                                            $
                                                            1,009
                                                            
                                                            $
                                                            33,186,530
                                                            
                                                            $
                                                            (4,662,689
                                                            )
                                                            $
                                                            (4,929,581
                                                            )
                                                            $
                                                            23,595,269




The
accompanying notes should be read in connection with the financial
statements.









F-4
 Table of Contents




India
Globalization Capital, Inc.


CONSOLIDATED
STATEMENT OF CASH FLOWS




Year
      Ended
                                              March
      31, 2009
                                            
                                            
                                            Year
      Ended
                                              March
      31, 2008Cash
      flows from operating activities:Net
      income (loss)
                                            
                                            $
                                            (521,576
                                            )
                                            
                                            $
                                            (5,215,270
                                            )Adjustment
      to reconcile net income (loss) to net cash used in operating
      activities:Interest
      earned on Treasury Bills
                                            
                                            
                                            
                                            
                                            
                                            
                                            (2,119,104
                                            )Non-cash
      compensation expense
                                            
                                            
                                            450,850Deferred
      taxes
                                            
                                            
                                            221,037
                                            
                                            
                                            
                                            (743,652
                                            )Depreciation
                                            
                                            
                                            873,022
                                            
                                            
                                            
                                            58,376Loss
      / (Gain) on sale of property, plant and equipment
                                            
                                            
                                            211,509
                                            
                                            
                                            
                                            29Amortization
      of debt discount on Oliveira debt
                                            
                                            
                                            2,652
                                            
                                            
                                            
                                            4,052,988Amortization
      of loan acquisition cost
                                            
                                            
                                            
                                            
                                            
                                            
                                            250,000Changes
      in:Accounts
      receivable
                                            
                                            
                                            (2,725,195
                                            )
                                            
                                            
                                            808,978Unbilled
      Receivable
                                            
                                            
                                            1,484,960
                                            
                                            
                                            
                                            (635,207
                                            )Inventories
                                            
                                            
                                            (1,001,389
                                            )
                                            
                                            
                                            341,950Prepaid
      expenses and other current assets
                                            
                                            
                                            1,099,188
                                            
                                            
                                            
                                            (3,063,771
                                            )Trade
      Payable
                                            
                                            
                                            (1,033,319
                                            )
                                            
                                            
                                            (1,744,137
                                            )Other
      Current Liabilities
                                            
                                            
                                            (832,556
                                            )
                                            
                                            
                                            (884,639
                                            )Advance
      from Customers
                                            
                                            
                                            (1,311,200
                                            )
                                            
                                            
                                            (97,946
                                            )Other
      non-current liabilities
                                            
                                            
                                            (3,155,767
                                            )
                                            
                                            
                                            3,050,821Non-current
      assets
                                            
                                            
                                            (1,926,571
                                            )
                                            
                                            
                                            928,696Accounts
      receivable – Long Term
                                            
                                            
                                            
                                            
                                            
                                            
                                            (50
                                            )Interest
      receivable - convertible debenture
                                            
                                            
                                            277,479
                                            
                                            
                                            
                                            (240,000
                                            )Deferred
      interest liability
                                            
                                            
                                            
                                            
                                            
                                            
                                            (3,597,998
                                            )Accrued
      expenses
                                            
                                            
                                            (922,300
                                            )
                                            
                                            
                                            854,902Prepaid
      / taxes payable
                                            
                                            
                                            (21,415
                                            )
                                            
                                            
                                            (569,283
                                            )Minority
      Interest
                                            
                                            
                                            716,950
                                            
                                            
                                            
                                            (4,780
                                            )Net
      cash used in operating activities
                                            
                                            $
                                            (8,113,641
                                            )
                                            
                                            $
                                            (8,569,097
                                            )Cash
      flows from investing activities:Purchase
      of treasury bills
                                            
                                            
                                            
                                            
                                            
                                            
                                            (585,326,579
                                            )Maturity
      of treasury bills
                                            
                                            
                                            
                                            
                                            
                                            
                                            653,554,076Purchase
      of property and equipment
                                            
                                            
                                            (2,493,417
                                            )
                                            
                                            
                                            (3,447
                                            )Proceeds
      from sale of property and equipment
                                            
                                            
                                            488,886
                                            
                                            
                                            
                                            (13,521
                                            )Purchase
      of short term investments
                                            
                                            
                                            698
                                            
                                            
                                            
                                            (1
                                            )Non
      Current Investments
                                            
                                            
                                            1,395,444
                                            
                                            
                                            
                                            (498,677
                                            )Restricted
      cash
                                            
                                            
                                            272,754
                                            
                                            
                                            
                                            (1,714,422
                                            )Decrease
      (increase) in cash held in trust
                                            
                                            
                                            
                                            
                                            
                                            
                                            (4,116
                                            )Redemption
      of convertible debenture
                                            
                                            
                                            3,000,000Deposit
      towards acquisitions, net of cash acquired
                                            
                                            
                                            220,890
                                            
                                            
                                            
                                            (6,253,028
                                            )Payment
      of deferred acquisition costs
                                            
                                            
                                            
                                            
                                            
                                            
                                            (2,482,431
                                            )Net
      cash provided/(used) in investing activities
                                            
                                            $
                                            2,885,255
                                            
                                            
                                            $
                                            57,257,854Cash
      flows from financing activities:Issuance
      of common stock to founders
                                            
                                            
                                            
                                            
                                            
                                            
                                            (541
                                            )Net
      movement in cash credit and bank overdraft
                                            
                                            
                                            (1,215,253
                                            )
                                            
                                            
                                            646,515Proceeds
      from other short-term borrowings
                                            
                                            
                                            
                                            
                                            
                                            
                                            (275,114
                                            )Proceeds
      from long-term borrowings
                                            
                                            
                                            1,287,940
                                            
                                            
                                            
                                            (3,075,012
                                            )Repayment
      of long-term borrowings
                                            
                                            
                                            (591,927
                                            )
                                            
                                            
                                            (1,023
                                            )Due
      to related parties, net
                                            
                                            
                                            583,235
                                            
                                            
                                            
                                            (255,093
                                            )Issue
      of Equity Shares
                                            
                                            
                                            297,699
                                            
                                            
                                            
                                            0Money
      received pending allotment
                                            
                                            
                                            
                                            
                                            
                                            
                                            (3,669,574
                                            )Proceeds
      from notes payable to stockholders
                                            
                                            
                                            
                                            
                                            
                                            
                                            (270,000
                                            )Proceeds
      from notes payable to stockholders
                                            
                                            
                                            
                                            
                                            
                                            
                                            (600,000
                                            )Gross
      proceeds from initial public offering
                                            
                                            
                                            
                                            
                                            
                                            
                                            (33,140,796
                                            )Proceeds
      from note payable to Oliveira Capital, LLC
                                            
                                            
                                            2,000,000
                                            
                                            
                                            
                                            (769,400
                                            )Repayment
      of note payable to Oliveira Capital, LLC
                                            
                                            
                                            (2,517,324
                                            )Proceeds
      from other financing
                                            
                                            
                                            
                                            
                                            
                                            
                                            31,047Net
      cash provided/(used) by financing activities
                                            
                                            $
                                            (155,630
                                            )
                                            
                                            $
                                            (41,378,991
                                            )Effect
      of exchange rate changes on cash and cash equivalents
                                            
                                            
                                            (884,059
                                            )
                                            
                                            
                                            (81,747
                                            )Net
      increase/(decrease) in cash and cash equivalent
                                            
                                            
                                            (6,268,075
                                            )
                                            
                                            
                                            7,228,019Cash
      and cash equivalent at the beginning of the period
                                            
                                            
                                            8,397,440
                                            
                                            
                                            
                                            1,169,422Cash
      and cash equivalent at the end of the period
                                            
                                            $
                                            2,129,365
                                            
                                            
                                            $
                                            8,397,441Supplemental
      schedule of non cash financing activities:Accrual
      of deferred acquisition costs
                                            
                                            
                                            
                                            
                                            
                                            $
                                            26,000Accrual
      of loan acquisition cost
                                            
                                            
                                            
                                            
                                            
                                            $
                                            250,000Value
      of Common Stock to Bridge Investors
                                            
                                            
                                            
                                            
                                            
                                            $
                                            3,170,806




The
accompanying notes should be read in connection with the financial
statements.


F-5
 Table of Contents




INDIA
GLOBALIZATION CAPITAL, INC. AND SUBSIDIARIES


NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS


For
the Years Ended March 31, 2009 and 2008





NOTE
A — BASIS OF PRESENTATION





The
financial statements for March 31, 2009 and 2008 are audited.  The
statements ending March 31, 2009 and 2008 are consolidated with all of our
subsidiaries. Sricon and TBL were acquired on March 8, 2008.   IGC
Mining and Trading, Limited (IGC-IMT) was formed beneficially by IGC India
Globalization Capital, Mauritius, Limited (IGC-M) on December 16,
2008.  All our companies have financial years that end on March
31.





In the
opinion of management, all adjustments (consisting of normal accruals) have been
made that are necessary to present fairly the financial position of the Company
as of March 31, 2009 and the results of its operation and cash flows for the
three years ended March 31, 2009 and 2008.





These
financial statements should be read in conjunction with the financial statements
that were included in the Company’s Annual Report on Form 10-KSB for the year
ended March 31, 2008.  The March 31, 2008 and 2009 balance sheets,
statements of operations, statements of cash flows, and the statements of
stockholders’ equity have been derived from the audited financial
statements.





NOTE
B — ORGANIZATION AND BUSINESS OPERATIONS





India
Globalization Capital, Inc. (the “Company” or “IGC”), a Maryland
corporation, was incorporated on April 29, 2005 as a blank check
company, formed for the purpose of acquiring one or more infrastructure
businesses with operations primarily in India through a merger, capital stock
exchange, asset acquisition or other similar business combination or
acquisition. On March 8, 2006 the Company completed an initial public
offering.  On February 19, 2007 the Company incorporated India
Globalization Capital, Mauritius, Limited (IGC-M), a wholly owned subsidiary,
under the laws of Mauritius.





Through
its subsidiaries, the company’s primary focus is to execute
major infrastructure projects in India such as constructing interstate
highways, rural roads, mining and quarrying, and construction of high
temperature cement and steel plants. IGC-IMT has been contracted to operate a
shipping hub and export iron ore to China.





The
registration statement for the Company’s initial public offering (the “Public
Offering”) (as described in Note C) was declared effective March 2, 2006. The
Company consummated the Public Offering including the over allotment option on
March 8, 2006, and preceding the consummation of the Public Offering on March 2,
2006 certain of the officers and directors of the Company purchased an aggregate
of 170,000 units (the “Units”) from the Company in a private placement (the
“Private Placement”).  The Units sold in the Private Placement were
identical to the 11,304,500 Units sold in the Public Offering, but the
purchasers in the Private Placement waived their rights to conversion and
receipt of the distribution on liquidation in the event the Company did not
complete a business combination (as described below). The Company received net
proceeds from the Private Placement and the Public Offering of approximately
$62,815,000 (Note C).





As
described in Note K, on March 7, 2008 following the stockholder approval of and
pursuant to the terms of the purchase agreement, the Company consummated the
acquisition of 63% of the equity of Sricon Infrastructure Private Limited
(Sricon) for  approximately $28.75 Million.  As also
described in Note K, the Company paid about $12.03 Million for the acquisition
of 77% of Techni Bharathi Limited (TBL).  The shares of the two Indian
companies, Sricon and TBL, are held by IGC-M.  The founders and
management of Sricon own 37% of Sricon and the founders and management of TBL
own 23% of TBL.




NOTE
C — INITIAL PUBLIC OFFERING




On March 8, 2006, the Company sold
11,304,500 Units in the Public Offering, including the exercise by the
Underwriter of the over-allotment in full. Each Unit consists of one share
of the Company’s common stock, $.0001 par value, and two redeemable common stock
purchase warrants (“Warrants”). Each Warrant entitles the holder to purchase
from the Company one share of common stock at an exercise price of $5.00. The
Company has a right to redeem the Warrants in the event that the last sale price
of the common stock is at least $8.50 per share for any 20 trading-days within a
30-trading day period ending on the third day prior to the date on which notice
of redemption is given.  If the Company redeems the Warrants, either
the holder will have to exercise the Warrants by purchasing the common stock
from the Company for $5.00, or the Warrants will expire. The Warrants expire on March 3, 2011,
or earlier upon redemption.





In
connection with the Public Offering, the Company issued an option, for $100, to
the Underwriter to purchase 500,000 Units at an exercise price of $7.50 per
Unit. The Company has accounted for the fair value of the option, inclusive of
the receipt of the $100 cash payment, as an expense of the Public Offering
resulting in a charge directly to stockholders’ equity. The Company estimated,
using the Black-Scholes method, the fair value of the option granted to the
Underwriter as of the date of grant was approximately $756,200 using the
following assumptions: (1) expected volatility of 30.1%, (2) risk-free interest
rate of 3.9% and (3) expected life of five years. The estimated volatility was
based on a basket of Indian companies that trade in the United States or the
United Kingdom.  The option may be exercised for cash or on a
“cashless” basis, at the holder’s option, such that the holder may use the
appreciated value of the option (the difference between the exercise prices of
the option and the underlying Warrants and the market price of the Units and
underlying securities) to exercise the option without the payment of any cash.
The Warrants underlying such Units are exercisable at $6.25 per
share.




F-6
 Table of Contents




NOTE
D — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES





Principles
of Consolidation:





The
consolidated financial statements include the accounts of the Company and its
wholly owned subsidiaries. All material intercompany balances and transactions
have been eliminated.





Minority
interest in subsidiaries consists of equity securities issued by a subsidiary of
the Company. No gain or loss was recognized
as a result of the issuance of these securities, and the Company owned a
majority of the voting equity of the subsidiary both
before and after the transactions. The Company reflects the impact of the equity
securities issuances in its investment in subsidiary
and additional paid-in-capital accounts for the dilution or anti-dilution of its
ownership interest in the subsidiary.





Use
of estimates:





The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenue and expenses during
the reporting period. Actual results could differ from those
estimates.





Revenue
recognition:





Revenue
is recognized based on the nature of activity when consideration can be
reasonably measured and there exists reasonable certainty of its
recovery.




Revenue
from sale of goods is recognized when substantial risks and rewards of ownership
are transferred to the buyer under the terms of the contract.




Revenue
from construction/project related activity and contracts for
supply/commissioning of complex plant and equipment is recognized as
follows:




a)
            
            Cost
      plus contracts: Contract revenue is determined by adding the aggregate
      cost plus proportionate margin as agreed with the customer and expected to
      be realized.b)
            
            Fixed
      price contracts: Contract revenue is recognized using the percentage
      completion method. Percentage of completion is determined as a proportion
      of cost incurred-to-date to the total estimated contract cost. Changes in
      estimates for revenues, costs to complete and profit margins are
      recognized in the period in which they are reasonably
      determinable




Full
provision is made for any loss in the period in which it is
foreseen.




Revenue
from property development activity is recognized when all significant risks and
rewards of ownership in the land and/or building are transferred to the customer
and a reasonable expectation of collection of the sale consideration from the
customer exists.




Revenue
from service related activities and miscellaneous other contracts are recognized
when the service is rendered using the proportionate completion method or
completed service contract method.


Income
per common share:





Basic
earnings per share is computed by dividing net income (loss) applicable to
common stockholders by the weighted average number of common shares outstanding
for the period. Diluted earnings per share reflect the additional dilution for
all potentially dilutive securities such as stock warrants and options. The
effect of the 23,374,000 warrants have been included in the diluted weighted
average shares.   However, for the years ending March 31, 2008
and 2009, the weighted average price of the common stock was below the exercise
price of all outstanding warrants and therefore the warrants did not contribute
to the dilution of basic shares.





Income
taxes:





Deferred
income taxes are provided for the differences between the bases of assets and
liabilities for financial reporting and income tax purposes. A valuation
allowance is established when necessary to reduce deferred tax assets to the
amount expected to be realized.




Cash
and Cash Equivalents:





For
financial statement purposes, the Company considers all highly liquid debt
instruments with maturity of three months or less when purchased to be cash
equivalents. The company maintains its cash in bank accounts in the United
States of America and Mauritius, which at times may exceed applicable insurance
limits. The Company has not experienced any losses in such accounts. The Company
believes it is not exposed to any significant credit risk on cash and cash
equivalent.  The company does not invest its cash in securities that
have an exposure to U.S. mortgages.





Restricted
cash:




Restricted
cash consists of deposits pledged with various government authorities and
deposits restricted as to usage under lien to banks for guarantees and letters
of credit given by the Company. The restricted cash is primarily invested in
time deposits with banks.




F-7
 Table of Contents




Accounts
receivable:




Accounts
receivables are recorded at the invoiced amount. Account balances are written
off when the company believes that the receivables will not be recovered. The
company’s bad debts are included in selling and general administrative expenses.
The company did not recognize any bad debts during the year ended March 31, 2009
and March 31, 2008, respectively.




Inventories:





Inventories
primarily comprise finished goods, raw materials, work in progress, stock at
customer site, stock in transit, components and accessories, stores and spares,
scrap, residue and real estate. Inventories are stated at the lower of cost or
estimated net realizable value.




The Cost
of various categories of inventories is determined on the following
basis:




Raw
Material are valued at weighted average of landed cost (Purchase price, Freight
inward and transit insurance charges), Work in progress is valued as confirmed,
valued & certified by the technicians & site engineers and Finished
Goods at material cost plus appropriate share of labor cost and production
overhead. Components and accessories, stores erection, materials, spares and
loose tools are valued on a First-in-First out basis. Real Estate is valued at
the lower of cost or net realizable value.





Accounts
Receivable – Long Term:





Known in
India as Build-Operate-Transfer (BOT). It is money due to the company by the
private or public sector to finance, design, construct, and operate a facility
stated in a concession contract over an extended period of time.





Investments:




Investments
are initially measured at cost, which is the fair value of the consideration
given for them, including transaction costs. Investments generally comprises of
fixed deposits with banks.





Property,
Plant and Equipment:




Property
and equipment are stated at cost less accumulated depreciation. Depreciation of
computers, construction, scrap processing and other equipments, buildings and
other assets are provided based on the Straight-line method over useful life of
the assets.




The value
of plant and equipment that are capitalized include the acquisition price and
other direct attributable expenses.




The
estimated useful life of various categories of assets are as
follows:




Category
                        
                        Useful
      Life (years)Building
      (Flat)
                        
                        
                        25Plant
      and Machinery
                        
                        
                        20Computer
      Equipment
                        
                        
                        3Office
      Equipment
                        
                        
                        5Furniture
      and Fixtures
                        
                        
                        5Vehicles
                        
                        
                        5Leasehold
      Improvements
                        
                        Over
      the period of lease or useful life (if less)




Upon
disposition, cost and related accumulated depreciation of the Property and
equipment are removed from the accounts and the gain or loss is reflected in the
results of operation. Cost of additions and substantial improvements to property
and equipment are capitalized in the books of accounts. The cost of maintenance
and repairs of the property and equipment are charged to operating
expenses.




Policy
for Goodwill / Impairment:





Goodwill
represents the excess cost of an acquisition over the fair value of the Group's
share of net identifiable assets of the acquired subsidiary at the date of
acquisition.  Goodwill on acquisition of subsidiaries is disclosed
separately.  Goodwill is stated at cost less accumulated amortization
and impairment losses, if any.




The
company adopted provisions of FAS No. 142, "Goodwill and Other Intangible
Assets" ('FAS 142') which sets forth the accounting for goodwill and intangible
assets subsequent to their acquisition. FAS142 requires that goodwill and
indefinite-lived intangible assets no longer be amortized, but instead tested
for impairment at least annually.




The
goodwill impairment test under FAS 142 is performed in two phases during the
fourth quarter of each year. The first step of the impairment test, used to
identify potential impairment compares the fair value of the reporting unit with
its carrying amount, including goodwill. If the carrying amount of the reporting
unit exceeds its fair value, goodwill of the reporting unit is considered
impaired, and step two of the impairment test must be performed. The second step
of the impairment test quantifies the amount of the impairment loss by comparing
the carrying amount of goodwill to the implied fair value. An impairment loss is
recorded to the extent the carrying amount of goodwill exceeds its implied fair
value.




F-8
 Table of Contents




Impairment
of long – lived assets and intangible assets:




The
company reviews its long-lived assets, including identifiable intangible
assets with finite lives, for impairment whenever events or changes in business
circumstances indicate that the carrying amount of assets may not be fully
recoverable. Such circumstances include, though are not limited to, significant
or sustained declines in revenues or earnings and material adverse changes in
the economic climate.  For assets that the company intends to hold for
use, if the total of the expected future undiscounted cash flows produced by the
assets or subsidiary company is less than the carrying amount of the assets, a
loss is recognized for the difference between the fair value and carrying value
of the assets.  For assets the company intends to dispose of by
sale, a loss is recognized for the amount by which the estimated fair value less
cost to sell is less than the carrying value of the assets.  Fair
value is determined based on quoted market prices, if available, or other
valuation techniques including discounted future net cash flows.





Asset
retirement obligations:




Asset
retirement obligations associated with the Company’s leasehold land are subject
to the provisions of FAS No. 143 “Accounting for Asset Retirement Obligations”
and related interpretation, FIN No. 47, “Accounting for Conditional Asset
Retirement Obligations, an interpretation of FASB Statement No. 143” . The lease
agreements entered into by the Company may contain clauses requiring restoration
of the leased site at the end of the lease term and therefore create asset
retirement obligations. The Company records the fair value of a liability for an
asset retirement obligation in the period in which it is incurred and
capitalizes the cost by increasing the carrying amount of the related long-lived
asset. Over time, the liability is accreted to its present value of each period,
and the capitalized cost is depreciated over the estimated useful life of the
related asset. Upon settlement of the liability, the Company either settles the
obligation for its recorded amount or incurs a gain or loss upon
settlement.




Foreign
currency transactions:




Monetary
assets and liabilities denominated in foreign currencies are expressed in the
functional currency Indian Rupees at the rates of exchange in effect at the
balance sheet date. Transactions in foreign currencies are recorded at rates
ruling on the transaction dates. Adjustments resulting from the translation of
functional currency financial statements to reporting currency are accumulated
and reported as other comprehensive income/(loss), a separate component of
shareholders’ equity.




Operating
leases:




Lease
payments under operating leases are recognized as an expense on a straight-line
basis over the lease term.




Capital
leases:




Assets
acquired under capital leases are capitalized as assets by the Company at the
lower of the fair value of the leased property or the present value of the
related lease payments or where applicable, the estimated fair value of such
assets. Amortization of leased assets is computed on straight line basis over
the useful life of the assets. Amortization charge for capital leases is
included in depreciation expense.


Recent
Pronouncements:





The
Company adopted FASB Interpretation No. 48, “Accounting for Uncertainty in
Income Taxes,” an interpretation of FASB Statement No. 109 (“FIN 48”) on
April 1, 2007.  FIN 48 clarifies the criteria for the recognition,
measurement, presentation and disclosure of uncertain tax positions. A tax
benefit from an uncertain position may be recognized only if it is “more likely
than not” that the position is sustainable based on its technical merits. FIN 48
also provides guidance on de-recognition, classification, interest and
penalties, accounting in interim periods, disclosure, and
transition.  In May 2007, the FASB issued Staff Position, FIN 48-1,
“Definition of Settlement in
FASB Interpretation No. 48” (FSP FIN 48-1) which provides guidance on how
an enterprise should determine whether a tax position is effectively settled for
the purpose of recognizing previously unrecognized tax
benefits.   FSP FIN 48-1 was effective with the initial adoption
of FIN 48.  The adoption of FIN 48 or FSP FIN 48-1 did not have a material
effect on the Company’s financial condition or results of
operations.





In
September 2006, the FASB issued FAS No.157, “Fair Value Measurements” (FAS No.
157). FAS No. 157 clarifies the principle
that fair value should be based on the assumptions market participants would use
when pricing an asset or liability and
establishes a fair value hierarchy that prioritizes the information used to
develop those assumptions. The Company’s adoption
of this Standard on January 1, 2008 did not have a material effect on its
financial statements. Relative to FAS 157, the FASB issued FASB Staff Positions
(FSP) FAS 157-1, FAS 157-2, and FAS 157-3. FSP FAS 157-1 amends SFAS 157 to
exclude SFAS No. 13,“Accounting for Leases” (SFAS 13), and its related
interpretive accounting pronouncements that address leasing transactions, while
FSP FAS 157-2 delays the effective date of the application of SFAS 157 to fiscal
years beginning after November 15, 2008 for all nonfinancial assets and
nonfinancial liabilities that are recognized or disclosed at fair value in the
financial statements on a non-recurring basis. FSP FAS 157-3 clarifies the
application of FAS 157 as it relates to the valuation of financial assets in a
market that is not active for those financial assets. This FSP is effective
immediately and includes those periods for which financial statements have not
been issued. We currently do not have any financial assets that are valued using
inactive markets, and as such are not impacted by the issuance of this
FSP.





In
February 2007, the FASB issued FAS No. 159, “The Fair Value Option for Financial
Assets and Financial Liabilities— Including
an amendment of FASB Statement No. 115” (FAS No. 159). FAS No. 159 provides
companies with a choice to measure
certain financial assets and liabilities at fair value that are not currently
required to be measured at fair value (the “Fair
Value Option”). Election of the Fair Value Option is made on an
instrument-by-instrument basis and is irrevocable. The Company’s adoption of
this Standard on January 1, 2008 did not have a material effect on its financial
statements.





In
December 2007, the Financial Accounting Standards Board released SFAS 160
“Non-controlling Interests in Consolidated Financial Statements” that is
effective for annual periods beginning December 15, 2008. The pronouncement
resulted from a joint project between the FASB and the International Accounting
Standards Board and continues the movement toward the greater use of fair values
in financial reporting. Upon adoption of SFAS 160, the Company will re-classify
any non-controlling interests as a component of equity.





Management
does not believe that any other recently issued, but not yet effective,
accounting standards if currently adopted would have a material effect on the
accompanying financial statements.




F-9
 Table of Contents




Segment
and Geographic Reporting:





India
Globalization Capital, Inc. and its subsidiaries are significantly engaged in
one segment, infrastructure construction.  Since there is no Chief
Officer who allocates resources as described in FAS No. 131, the Company is not
required to report its operations by business segment reporting.  All
revenue reporting in the years ending March 31, 2009 and March 31, 2008 were
earned solely in India.  Therefore, no disclosures indicating source
country revenue is provided in this annual report.




NOTE
E – SHORT TERM BORROWINGS & CURRENT PORTION OF LONG-TERM DEBT




(Amounts
in thousand US Dollars)




Short term debt for the consolidated
companies consists of the following:




As
      of
                                March
      31, 2009
                              
                              
                              As
      of
                                March
      31, 2008Secured
                              
                              $
                              2,502
                              
                              
                              $
                              4,556Unsecured
                              
                              
                              249
                              
                              
                              
                              3,306Total
                              
                              
                              2,751
                              
                              
                              
                              7,862Add:Current
      portion of long term debt
                              
                              
                              671
                              
                              
                              
                              773Total
                              
                              $
                              3,422
                              
                              
                              $
                              8,635




The above
debt is secured by hypothecation of materials/stock of spares, Work in Progress,
receivables and property & equipment in addition to personal guarantee of
three directors & collaterally secured by mortgage of company’s land &
other immovable properties of directors and their relatives.




LONG
TERM DEBT:




(Amounts
in thousand US Dollars)




Long term
debt for the consolidated companies consists of the following:




As
      March 31, 2009
                            
                            
                            As
      of March 31, 2008Secured
                            
                            $
                            -
                            
                            
                            $
                            -Term
      loans
                            
                            
                            -
                            
                            
                            
                            632Loan
      for assets purchased under capital lease
                            
                            
                            2,169
                            
                            
                            
                            1,354Total
                            
                            
                            2,169
                            
                            
                            
                            1,986Less:
      Current portion (Payable within 1 year)
                            
                            
                            671
                            
                            
                            
                            773Total
                            
                            $
                            1,498
                            
                            
                            $
                            1,213





The
secured loans were collateralized by:


- Unencumbered
  Net Asset Block of the Company
- Equitable
  mortgage of properties owned by promoter directors/ guarantors
- Term
  Deposits
- Hypothecation
  of receivables, assignment of toll rights, machineries and vehicles and
  collaterally secured by depositof title
  deeds of land
- First
  charge on Debt-Service Reserve Account

NOTE
F — RELATED PARTY TRANSACTIONS





From
inception to March 31, 2009, $50,000 was paid to SJS Associates for Mr.
Selvaraj’s services.  We entered into an agreement with SJS Associates
on substantially the same terms subsequent to the stockholder’s approval of the
acquisitions of Sricon and TBL.As a result of the
new agreement, an additional $3,871 was accrued as due to SJS Associates for the
period between March 8, 2008 and March 31, 2008.  This was paid to SJS
Associates in the Company’s 2009 fiscal year.





The
Company had agreed to pay Integrated Global Network, LLC (“IGN, LLC”), an
affiliate of our Chief Executive Officer, Mr. Mukunda, an administrative fee of
$4,000 per month for office space and general and administrative services from
the closing of the Public Offering through the date of a Business
Combination. From inception to March 31, 2009, approximately $144,000 was
paid to IGN, LLC.  During March of 2008, the Company and IGN, LLC
agreed to continue the agreement on a month-to-month basis.





The
Company uses the services of Economic Law Practice (ELP), a law firm in
India. A member of our Board Directors is a Partner with ELP. 
Since inception to March 31, 2009, the Company has incurred $186,303 for legal
services provided by ELP.




F-10
 Table of Contents




NOTE
G — COMMON STOCK





On August
24, 2005, the Company’s Board of Directors authorized a reverse stock split of
one share of common stock for each two outstanding shares of common stock and
approved an amendment to the Company’s Certificate of Incorporation to decrease
the number of authorized shares of common stock to 75,000,000. All references in
the accompanying financial statements to the number of shares of stock have been
retroactively restated to reflect these transactions.  On March 7,
2008 we redeemed and bought a total of 6,159,346 shares at $5.94 per
share.  At March 31, 2008 and 2007 we had 8,570,107 and 13, 974,500
shares of common stock issued and outstanding respectively.   At
March 31, 2008 and 2007, 24,874,000 shares of common stock, were reserved for
issuance upon exercise of redeemable warrants, underwriters’ purchase option and
warrants issued to Oliveira Capital, LLC.  At March 31, 2009 we had
10,091,171shares of common stock issued and outstanding.




NOTE H
– INCOME TAXES





The
provision for income taxes for the year ended March 31, 2009 and the period
ended March 31, 2008 consists of the following:





March
      31,2009
                          
                          
                          2008Current:Federal
                          
                          $
                          61,355
                          
                          
                          $
                          708,868Foreign
                          
                          
                          1,396,248
                          
                          
                          
                          (370,355
                          )State
                          
                          
                          0
                          
                          
                          
                          -Net
      Current
                          
                          
                          1,457,603
                          
                          
                          
                          338,513Deferred:Federal
                          
                          
                          10,322
                          
                          
                          
                          (748,894
                          )Foreign
                          
                          
                          95,824
                          
                          
                          
                          420,368State
                          
                          
                          0
                          
                          
                          
                          66,103Net
      Deferred
                          
                          
                          106,146
                          
                          
                          
                          (262,424
                          )Total
      tax provision
                          
                          $
                          1,563,750
                          
                          
                          $
                          76,089





The total
tax provision for income taxes for year ended March 31, 2009 and the period
ended March 31, 2008 differs from that amount which would be computed by
applying the U.S. Federal income tax rate to income before provision for income
taxes as follows:





March
      31,2009
                      
                      
                      2008Statutory
      Federal income tax rate
                      
                      
                      34
                      %
                      
                      
                      34
                      %State
      tax benefit net of federal tax
                      
                      
                      0
                      %
                      
                      
                      (0.8
                      )%Increase
      in state valuation allowance
                      
                      
                      0
                      %
                      
                      
                      0.8
                      %Effective
      income tax rate
                      
                      
                      34
                      %
                      
                      
                      34.0
                      %











March
      31,2009
                    
                    
                    2008Operating
      costs deferred for income tax purposes
                    
                    $
                    (183,129
                    )
                    
                    $
                    184,570Interest
      income deferred for reporting purposes
                    
                    
                    0
                    
                    
                    
                    95,792Difference
      between accrual accounting for reporting purposes and cash accounting for
      tax purposes
                    
                    
                    599,802
                    
                    
                    
                    235,665Less:
      Valuation Allowance
                    
                    
                    (108,041
                    )
                    
                    
                    (110,951
                    )Net
      deferred tax asset
                    
                    $
                    309,252
                    
                    
                    $
                    405,076





The
Company has recorded a valuation allowance against the state deferred tax asset
since they cannot determine realizability for tax purposes and therefore cannot
conclude that the deferred tax asset is more likely than not recoverable at this
time.





NOTE
I — COMMITMENTS AND CONTINGENCY





The
Founders will be entitled to registration rights with respect to their shares of
common stock acquired prior to the Public Offering and the shares of common
stock they purchased in the Private Placement pursuant to an agreement executed
on March 3, 2006. The holders of the majority of these shares are entitled
to make up to two demands that the Company register these shares at any time
after the date on which the lock-up period expires.  In addition, the
Founders have certain “piggy-back” registration rights on registration
statements filed subsequent to the anniversary of the effective date of the
Public Offering.




F-11
 Table of Contents




NOTE
J – INVESTMENT ACTIVITIES




Contract
Agreement between IGC, CWEL, AMTL and MAIL





As
previously disclosed in our Form 8-K dated May 2, 2007 and Form 10-QSB for the
quarterly period ended June 30, 2007, on April 29, 2007, the Company entered
into a Contract Agreement Dated April 29, 2007 (“CWEL Purchase Agreement”) with
CWEL, Arul Mariamman Textiles Limited (AMTL), and Marudhavel Industries
Limited (MAIL), collectively CWEL. Pursuant to the CWEL Purchase Agreement, the
Company or its subsidiary in Mauritius will acquire 100% of a 24-mega watt wind
energy farm, consisting of 96 250-kilowatt wind turbines, located in Karnataka,
India to be manufactured by CWEL.





CWEL is a
manufacturer and supplier of wind operated electricity generators, towers and
turnkey implementers of wind energy farms.  On May 22, 2007, the
Company made a down payment of approximately $250,000 to
CWEL.  Pursuant to the First Amendment dated August 20, 2007 (as
previously disclosed in the Company’s Form 8-K dated August 22, 2007), if the
Company does not consummate the transaction with CWEL, approximately $187,500
will be returned to the Company.





The
Company is contemplating pursuing this and similar opportunities in the
alternative energy space if it is able to obtain adequate funding from the
exercise of warrants, debt or other means.




NOTE
K – BUSINESS COMBINATION





As
previously disclosed in our Form 8-K dated September 21, 2007 and Form 10-QSB
for the quarterly period ended June 30, 2007, on September 21, 2007, the Company
entered into a Share Subscription cum Purchase Agreement  (the “Sricon
Subscription Agreement”) dated as of September 15, 2007 with Sricon
Infrastructure Private Limited  (“Sricon”) and certain individuals
(collectively, the “Sricon Promoters”), pursuant to which the Company or its
subsidiary in Mauritius (IGC-M) will acquire (the “Sricon Acquisition”)4,041,676 newly-issued
equity shares  (the “New Sricon Shares”) directly from Sricon for
approximately $26 million and 351,840 equity shares from Mr. R. L. Srivastava
for approximately $3 million (both based on an exchange rate of INR 40 per USD)
so that at the conclusion of the transactions contemplated by the Sricon
Subscription Agreement the Company would ownapproximately63% of the outstanding
equity shares of Sricon.  Effectively, the purchase price of $26 million
was funded with approximately $8.1 million in cash and a note for $17.9 million
(computed at an exchange rate of approximately 40 INR to $1
USD).  Failure to repay the note or negotiate a settlement could
result in IGC having to decrease its ownership in Sricon by tendering all or a
portion of the Sricon shares it owns to Sricon to repay the note. The Sricon
Acquisition was consummated on March 7, 2008.





As
previously disclosed in our Form 8-K dated September 21, 2007 and Form 10-QSB
for the quarterly period ended June 30, 2007, on September 21, 2007, the Company
entered into a Share Subscription Agreement  (the “TBL Subscription
Agreement”) dated as of September 16, 2007 with Techni Bharathi Limited (“TBL”)
and certain individuals (collectively, the “TBL Promoters”), pursuant to which
the Company through its subsidiary in Mauritius (IGC-M) acquired (the “TBL
Acquisition”)7,150,000 newly-issued
company stock for approximately $6.9 million, 1,250,000 newly-issued convertible
preference shares for approximately $3.13 million  (both at an
exchange rate of INR 40 per USD; collectively, the “New Shares”) directly from
TBL and 5,000,000 convertible preference shares from Odeon, a Singapore based
holder of TBL securities, for approximately $2 million.  With the
conclusion of this transaction, on March 7, 2008 the Company ownsapproximately 77%, of
the outstanding equity shares of TBL.




NOTE
L – PRIVATE PLACEMENT OF PROMISSORY NOTES





Private
Placement Offering of Secured Promissory Notes (the “Bridge
Offering”)





As
previously disclosed in our Form 8-K dated December 27, 2007, we conducted a
private placement offering of secured promissory notes (the “Notes”) for an
aggregate principal amount of $7,275,000 (the “Bridge Offering”). The Notes
bear interest at a rate equal to 5% per annum from the date of issuance (January
10, 2008) until paid in full.  The Notes were repaid in
full on March 19, 2008.





On March
7, 2008 the Company, issued 754,953 shares of common stock to the holders
of the Notes on a pro rata basis and recorded the cost of the shares as an
expense based on the closing price of the company’s stock on March 7,
2008.  The expense associated with the issuance of the shares is about
$3,170,806.




NOTE
M – VALUATION OF WARRANTS ISSUED TO OLIVEIRA CAPITAL, LLC





We
account for derivative instruments and embedded derivative instruments in
accordance with SFAS No. 133,
Accounting for Derivative Instruments and Hedging Activities, as amended. The
amended standard requires an entity to recognize all derivatives as either
assets or liabilities in the statement of financial position and measure these
instruments at fair value. Fair value is estimated using the Black-Scholes
Pricing model. We also follow EITF Issue No. 00-19, Accounting for Derivative
Financial Instruments Indexed to and Potentially Settled in, a Company’s Own
Stock, which requires freestanding contracts that are settled in a company’s own
stock, including common stock warrants, to be designated as an equity
instrument, asset or a liability. Under the provisions of EITF Issue No. 00-19,
a contract designated as an asset or a liability must be carried at fair value,
with any changes in fair value recorded in the results of operations. A contract
designated as an equity instrument can be included in equity, with no fair value
adjustments are required.




F-12
 Table of Contents




As
previously disclosed, the Company sold a promissory note and 425,000 warrants to
Oliveira Capital, LLC for $3,000,000. Each warrant will entitle the holder
to purchase from the Company one share of common stock at an exercise price of
$5.00 and expires five years from the date of issuance.  The Company has
determined, based upon a Black-Scholes model, that the fair value of the
warrants on the date of issuance would approximately be $ 1,235,000 using an
expected life of five years, volatility of 46% and a risk-free interest rate of
4.8%. This amount is accounted for as a discount of the notes payable to
Oliveira Capital, LLC.





We
computed volatility for a period of five years. For approximately the first
four years, we used the trading history of two representative companies that are
listed on the Indian Stock exchange. For approximately one year, the
trading history of the Company’s common stock was used. The average volatility
of the combined data extending over five years was calculated as
46%. Management believes that this volatility is a reasonable benchmark to
use in estimating the value of the warrants.




NOTE
N – SPAC RELATED EXPENSES





As of
March 31, 2008 we incurred about $5.765 Million of SPAC related expenses, and
about $1.9 Million of SPAC interest related expenses, mostly as one-time
expenses.  The major expenses are as follows: 1) Approximately $3.1
Million was non-cash expenses associated with the award of stock to the Bridge
investors.  2) Approximately $1.5 Million was paid to Ferris Baker
Watts, of which $.9 Million was expensed as the services rendered by them
related to acquisitions that we did not close.  3) Approximately $.469
Million relates to the bridge loan from Oliveira Capital, LLC , and 5)
approximately $.5 Million was incurred for legal and professional fees for two
bridge loans and several acquisitions that we did not close.  In
addition, we incurred about $1.23 Million in non-cash interest related expenses
for the warrants issued to Oliveira Capital.




NOTE O
– SUBSEQUENT EVENTS




IGC-Mauritius
has beneficially formed a company called IGC Materials, Private Limited based in
India.  At the completion of the formalities, in the month
of July 2009, IGC-Mauritius will beneficially own 100% of the shares
of IGC Materials, Private Limited, which will conduct IGC’s rock aggregate and
materials business.




IGC India
Mining & Trading, a wholly owned subsidiary of IGC- Mauritius, has received
a line of credit from State Bank of Mysore with the following
parameters:





a) Letter
of Credit - USD 1 million (USD 1 = INR 50);


b)
Forward Contract  - USD 1 million (USD 1 = INR 50); and


c)
Foreign Demand Bills Payable / Foreign Usance Bills Payable - USD 1 million (USD
1 = INR 50).




The line
of credit is secured by a corporate guarantee from IGC Mauritius,
V. C. Homes (an associate company of the promoters of TBL), and a
personal guarantee of Mr. Pious Abraham (associate of TBL promoters).
The rate of interest is 1.25% above bank’s prime lending rate with a minimum of
interest rate of 14.25%.   The line is used to provide back to back letters
of credit for iron ore contracts.




F-13
 Table of Contents




Item9.         
Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure





None.




Changes
in Internal Control over Financial Reporting




There
have not been any changes in the Company's internal control over financial
reporting (as such term is defined in Rules 13a-15(f) under the Exchange Act)
during the fiscal period to which this report relates that have materially
affected, or are reasonably likely to materially affect, the Company's internal
control over financial reporting.




Item9A(T).  Evaluation of Disclosure Controls and
Procedures




Pursuant
to Rule 13a-15(b) under the Securities Exchange Act of 1934 (“Exchange Act”),
the Company carried out an evaluation, with the participation of the Company’s
management, including the Company’s Chief Executive Officer (“CEO”) and Chief
Financial Officer (“CFO”) (the Company’s principal financial and accounting
officer), of the effectiveness of the Company’s disclosure controls and
procedures (as defined under Rule 13a-15(e) under the Exchange Act) as of the
end of the period covered by this report, March 31, 2009.  Based upon
that evaluation, the Company’s CEO and CFO concluded that the Company’s
disclosure controls and procedures are effective to ensure that information
required to be disclosed by the Company in the reports that the Company files or
submits under the Exchange Act, is recorded, processed, summarized and reported,
within the time periods specified in the SEC’s rules and forms, and that such
information is accumulated and communicated to the Company’s management,
including the Company’s CEO and CFO, as appropriate, to allow timely decisions
regarding required disclosure.




Management’s Annual Report on
Internal Control over Financial Reporting





Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting. As defined in Exchange Act Rule 13a-15(f),
internal control over financial reporting is a process designed by, or under the
supervision of, our principal executive officer and principal financial officer
and effected by our board of directors, management and other personnel, to
provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles.





Under the
supervision and with the participation of our management, including our
principal executive officer and principal financial officer, we carried out an
evaluation of the effectiveness of our internal control over financial
reporting, as of March 31, 2009 based on the criteria in “Internal Control -
Integrated Framework” issued by the Committee of Sponsoring Organizations of the
Treadway Commission (“COSO”). Based upon this evaluation, our management
concluded that our internal control over financial reporting was effective as of
March 31, 2009.




This
annual report does not include an attestation report of the Company's registered
public accounting firm regarding internal control over financial reporting.
Management's report was not subject to attestation by the Company's registered
public accounting firm pursuant to temporary rules of the Securities and
Exchange Commission that permit the company to provide only management's report
in this annual report.




Changes in Internal Control Over Financial Reporting





No  change  in  the
Company's internal control over financial reporting occurred during the year
ended March 31, 2009, that materially affected, or is reasonably
likely  to  materially  affect,  the  Company's  internal
control over financial reporting.




The
Company’s management, including the Company’s CEO and CFO, does not expect that
the Company’s internal control over financial reporting will prevent all errors
and all fraud. Because of its inherent limitations, internal control over
financial reporting may not prevent or detect misstatements. Also, projections
of any evaluation of effectiveness to future periods are subject to the risk
that controls may become inadequate because of changes in conditions, or that
the degree or compliance with the policies or procedures may
deteriorate.




Item9B. Other Information





None.






24
 Table of Contents




PART
III





Item10.        Directors and
Executive Officers of the Company and Corporate Governance




The board
of directors, executive officers, advisors and key employees are as
follows:





Directors,
Executive Officers and Special Advisors of IGC





Name
              Age
              PositionDr.
      Ranga Krishna
              45
              Chairman
      of the BoardRam
      Mukunda
              51
              Chief
      Executive Officer, Executive Chairman, President and
    DirectorJohn
      Selvaraj
              65
              Principal
      Accounting OfficerSudhakar
      Shenoy
              62
              DirectorRichard
      Prins
              52
              DirectorSuhail
      Nathani
              44
              DirectorLarry
      Pressler
              67
              Special
      AdvisorHoward
      Gutman
              51
              Special
      AdvisorP.G.
      Kakodkar
              73
              Special
      AdvisorShakti
      Sinha
              53
              Special
      AdvisorDr.
      Prabuddha Ganguli
              60
              Special
      AdvisorDr.
      Anil K. Gupta
              60
              Special
      Advisor




Directors
and Executive Officers of Sricon




Name
              Age
              PositionRavindralal
      Srivastava
              56
              Chairman
      and Managing DirectorRam
      Mukunda
              51
              Director





Directors
and Executive Officers of TBL




Name
              Age
              PositionJortin
      Antony
              43
              Managing
      DirectorM.
      Santhosh Kumar
              44
              General
      Manager of AccountingRam
      Mukunda
              51
              Director




Ranga Krishna, has served as
our Chairman of the Board since December 15, 2005. Dr. Krishna previously served
as a Director from May 25, 2005 to December 15, 2005 and as our Special Advisor
from April 29, 2005 through June 29, 2005.  In 1998, he founded Rising
Sun Holding, LLC, a $120 million construction and land banking
company.  In September 1999, he co-founded Fastscribe, Inc., an
Internet-based medical and legal transcription company with its operations in
India with over 200 employees. He has served as a director of Fastscribe since
September 1999. He is currently the Managing Partner.  In February
2003, Dr. Krishna founded International Pharma Trials, Inc., a company with
operations in India and over 150 employees, which assists U.S. pharmaceutical
companies performing Phase II clinical trials in India. He is currently the
Chairman and CEO of that company.  In April 2004, Dr. Krishna founded
Global Medical Staffing Solutions, Inc., a company that recruits nurses and
other medical professionals from India and places them in U.S. hospitals. Dr.
Krishna is currently serving as the Chairman and CEO of that company. On
November 7, 2008 he joined the board of TransTech Service Partners, a SPAC which
initiated liquidation on May 23rd,
2009.  Dr. Krishna is a member of several organizations, including the
American Academy of Neurology and the Medical Society of the State of New
York. He is also a member of the Medical Arbitration panel for the New York
State Worker’s Compensation Board. Dr. Krishna was trained at New York’s Mount
Sinai Medical Center (1991-1994) and New York University
(1994-1996).





Ram Mukunda has served as our
Chief Executive Officer, President and a Director since our inception on April
29, 2005 and was Chairman of the Board from April 29, 2005 through December 15,
2005. Since September 2004 Mr. Mukunda has served as Chief Executive Officer of
Integrated Global Networks, LLC, a communications contractor in the U.S.
Government. From January 1990 to May 2004, Mr. Mukunda served as Founder,
Chairman and Chief Executive Officer of Startec Global Communications, an
international telecommunications carrier focused on providing voice over
Internet protocol (VOIP) services to the emerging economies. Startec was among
the first carriers to have a direct operating agreement with India for the
provision of telecom services. Mr. Mukunda was responsible for the organizing,
structuring, and integrating a number of companies owned by Startec. Many
of these companies provided strategic investments in India-based operations
or provided services to India-based companies. Under Mr. Mukunda’s tenure
at Startec, the company made an initial public offering of its equity securities
in 1997 and conducted a public high-yield debt offering in 1998. Mr.
Mukunda was responsible for the restructuring of Startec after the company
filed for protection under Chapter 11 in December 2001. Startec emerged from
Chapter 11 in 2004.





From June
1987 to January 1990, Mr. Mukunda served as Strategic Planning Advisor at
INTELSAT, a provider of satellite capacity. Mr. Mukunda serves on the Board of
Visitors at the University of Maryland School of Engineering. From 2001-2003, he
was a Council Member at Harvard’s Kennedy School of Government, Belfer Center of
Science and International Affairs. Mr. Mukunda is the recipient of several
awards, including the University of Maryland’s 2001 Distinguished Engineering
Alumnus Award and the 1998 Ernst & Young, LLP’s Entrepreneur of the Year
Award. He holds B.S. degrees in electrical engineering and mathematics and a MS
in Engineering from the University of Maryland.




25
 Table of Contents




John B. Selvarajhas served as our
Treasurer and Principal Accounting Officer since November 27,
2006.  From November 15, 1997 to August 10, 2007, Mr. Selvaraj served
in various capacities with Startec, Inc., including from January 2001 to April
2006 as Vice President of Finance and Accounting where he was responsible for
SEC reporting and international subsidiary consolidation.  Prior to
joining Startec, from July 1984 to December 1994, Mr. Selvaraj served as the
Chief Financial and Administration Officer for the US office of the European
Union.  In 1969, Mr. Selvaraj received a BBA in Accounting from Spicer
Memorial College India, and an Executive MBA, in 1993, from Averette
University, Virginia.  Mr. Selvaraj is a Charted Accountant (CA,
1971).





Sudhakar Shenoy, has served as
our Director since May 25, 2005. Since January 1981, Mr. Shenoy has been the
Founder, Chairman and CEO of Information Management Consulting, Inc., a business
solutions and technology provider to the government, business, health and life
science sectors. Mr. Shenoy is a member of the Non Resident Indian Advisory
Group that advises the Prime Minister of India on strategies for attracting
foreign direct investment. Mr. Shenoy was selected for the United States
Presidential Trade and Development Mission to India in 1995. From 2002 to June
2005 he served as the chairman of the Northern Virginia Technology
Council.  In 1970, Mr. Shenoy received a B. Tech (Hons.) in electrical
engineering from the Indian Institute of Technology. In 1971 and 1973, he
received an M.S. in electrical engineering and an M.B.A. from the University of
Connecticut Schools of Engineering and Business Administration,
respectively.





Richard Prins, has served as
our Director since May 2007.  Since March 1996, he has been the
Director of Investment Banking at Ferris, Baker Watts, Incorporated (FBW was the
lead underwriter for our IPO).  Prior to Ferris, Baker Watts, from
July 1988 to March 1996, Mr. Prins was Senior Vice President and Managing
Director for the Investment Banking Division of Crestar Financial Corporation
(SunTrust Banks).  From 1993 to 1998, he was with the leveraged buy
out firm of Tuscarora Corporation. Since February 2003, he has been on the board
of Amphastar Pharma and since April 2006 he has been on the board of Advancing
Native Missions, a non-profit. Mr. Prins holds a B.A. degree from
Colgate University (1980), and an M.B.A. from
Oral Roberts University (1983).





Suhail Nathani, has served as
our Director since May 25, 2005. Since September 2001, he has served as a
partner at the Economics Laws Practice in India, which he co-founded. The
25-person firm focuses on consulting, general corporate law, tax regulations,
foreign investments and issues relating to the World Trade Organization (WTO).
From December 1998 to September 2001, Mr. Nathani was the Proprietor of the
Strategic Law Group, also in India, where he practiced telecommunications law,
general litigation and licensing.





Mr.
Nathani earned a LLM in 1991 from Duke University School of Law. In 1990 Mr.
Nathani graduated from Cambridge University with a MA (Hons) in Law. In
1987, he graduated from Sydenham College of Commerce and Economics, Bombay,
India.




Sricon
& TBL Management





Rabindralal B. Srivastava is
Founder and Chairman of Sricon. In 1974, he started his career at Larsen and
Toubro (L&T), one of India’s premier engineering and construction
companies.   In 1994, his company,  Vijay Engineering,
became a civil engineering sub-contractor to L&T.  He worked as a
sub-contractor for L&T in Haldia, West Bengal and Tuticorin in South India
among others.  Under his leadership, Vijay Engineering expanded to
include civil engineering and construction of power plants, water treatment
plants, steel mills, sugar plants and mining.  In 1996, Mr. Srivastava
founded Srivastava Construction Limited, which in 2004 changed its name to
Sricon Infrastructure to address the larger infrastructure needs in India like
highway construction. He merged Vijay Engineering and Sricon in
2004.  Mr. Srivastava graduated with a BS from Banaras University
in 1974.  Mr. Srivastava founded Hi-tech Pro-Oil Complex in
1996.  The company is involved in the extraction of soy bean
oil.  He founded Aurobindo Laminations Limited in 2003.  The
company manufactures laminated particleboards.





Jortin Antony, has been
the Managing Director of TBL since 2000.  Prior to that, he held
various positions at Bhagheeratha starting as a management trainee in
1991.  From 1997 to 2000, he was the Director of Projects at
Bhagheeratha. In 2003, Mr. Jortin Antony was awarded the Young Entrepreneur
Award from the Rashtra Deepika.  He graduated with a B.Eng, in 1991,
from Bangalore Institute of Technology, University of Bangalore.





M Santhosh Kumar, has been
with TBL since 1991. Since 2008 he has been the General Manager of
Accounting and Finance.  From  2002 to January 2008 he has
been the Deputy Manager (Finance and Accounting).  From 2000 to 2002,
he was the Marketing Executive for Techni Soft (India) Limited, a subsidiary of
Techni Bharathi Limited.  From 1991 to 2000, he held various positions
at TBL in the Finance and Accounting department.  From 1986 to 1991,
he worked as an accountant in the Chartered Account firm of Balan and
Company.  In 1986 Mr. Santhosh Kumar graduated with a BA in Commerce
from, Gandhi University, Kerala, India.





Special
Advisors





Senator Larry Pressler has
served as our Special Advisor since February 3, 2006. Since leaving the U.S.
Senate in 1997, Mr. Pressler has been a combination of businessman, lawyer,
corporate board director and lecturer at universities. From March 2002 to
present, he has been a partner in the New York firm, Brock law Partners. He was
a law partner with O’Connor & Hannan from  March 1997 to March
2002.





From 1979
to 1997, Mr. Pressler served as a member of the United States Senate. He served
as the Chairman of the Senate Commerce Committee on Science and Transportation,
and the Chairman of the Subcommittee on Telecommunications (1994 to 1997). From
1995 to 1997, he served as a Member of the Committee on Finance and from 1981 to
1995 on the Committee on Foreign Relations. From 1975 to 1979, Mr. Pressler
served as a member of the United States House of  Representatives.
Among other bills, Senator Pressler authored the Telecommunications Act of 1996.
As a member of the Senate Foreign Relations Committee, he authored the “Pressler
Amendment,” which became the parity for nuclear weapons in Asia from 1980 to
1996.





In 2000,
Senator Pressler accompanied President Clinton on a visit to India. He is a
frequent traveler to India where he lectures at universities and business
forums. He is a member of several boards of Indian and US companies including
the board of directors for Infosys Technologies, Inc. (INFY). He serves on the
board of directors for The Philadelphia Stock Exchange and Flight Safety
Technologies, Inc. (FLST). From 2002 to 2005 he served on the board of advisors
at Chrys Capital, a fund focused on investments in India. He was on the board of
directors of Spectramind from its inception in 1999 until its sale to WIPRO, Ltd
(WIT) in 2003.





In 1971,
Mr. Pressler earned a Juris Doctor from Harvard Law School and a
Masters in Public Administration from the Kennedy School of Government at
Harvard. From 1964 to 1965 he was a Rhodes Scholar at Oxford University, England
where he earned a diploma in public administration. Mr. Pressler is a Vietnam
war veteran having served in the U.S. Army in Vietnam in 1967-68. He is an
active member of the Veterans of Foreign Wars Association.





26
 Table of Contents




Howard Gutman has served as
our Special Advisor since April 5, 2007.   Although he is not
serving as an attorney for the Company, Mr. Gutman has been a lawyer in
Washington D.C. for twenty-five years.  Mr. Gutman rejoined
Williams & Connolly in October 1986 and became a partner in
1988.  He remains a partner at the firm today (although the firm has
no role with the Company), where he is a business litigator.





From May
1985 to October 1986, he was Special Assistant to the Director William H.
Webster of the Federal Bureau of Investigation.  From October 1982 to
May 1985, Mr. Gutman was an associate at the law firm of Williams &
Connolly.   Mr. Gutman has been active in Democratic politics for
20 years having served as an advisor to candidates for President, Governor, and
Congress.  He assisted the Gore campaign in Florida in
2000.    Since 1983, Mr. Gutman has been an Associate Editor of
Litigation Magazine and an active participant in the ABA’s Litigation
Section.  He has also appeared on several episodes of the HBO series
“K Street.”





Mr.
Gutman graduated from Columbia University with a B.A. Summa Cum Laude in
1977 and from the Harvard Law School, Magna Cum Laude in
1980.  From September 1980-September 1981, he served as a Law Clerk to
The Honorable Irving L. Goldberg of the United States Court of Appeals for the
Fifth Circuit.  From September 1981-September 1982, Mr. Gutman served
as Law Clerk to The Honorable Potter Stewart, (retd), United States Supreme
Court.




P. G. Kakodkar has served as
our Special Advisor since February 3, 2006. Mr. Kakodkar serves on the boards of
several Indian companies, many of which are public in India. Since January of
2005 he has been a member of the board of directors of State Bank of India (SBI)
Fund Management, Private Ltd., which runs one of the largest mutual funds in
India. Mr. Kakodkar’s career spans 40 years at the State Bank of India. He
served as its Chairman from October 1995 to March 1997. Prior to his
Chairmanship, he was the Managing Director of State Bank of India (SBI) Fund
Management Private Ltd., which operates the SBI Mutual Fund.





Since
July 2005, he has served on the board of directors of the Multi Commodity
Exchange of India. Since April 2000, he has been on the board of Mastek, Ltd, an
Indian software house specializing in client server applications. In June 2001,
he joined the board of Centrum Capital Ltd, a financial services company. Since
March 2000, he has been on the board of Sesa Goa Ltd., the second largest mining
company in India. In April 2000, he joined the board at Uttam Galva Steel and in
April 1999 he joined the board of Goa Carbon Ltd, a manufacturer-exporter of
petcoke. Mr. Kakodkar received a BA from Karnataka University and an MA
from Bombay University in economics, in 1954 and 1956, respectively. Mr.
Kakodkar currently is an advisor to Societe Generale, India, which is an
affiliate of SG Americas Securities, LLC and one of the underwriters of the our
IPO.





Shakti Sinha, has served as
our Special Advisor since May 25, 2005. Since July 2004, Mr. Sinha has been
working as a Visiting Senior Fellow, on economic development, with the
Government of Bihar, India. From January 2000 to June 2004, he was a Senior
Advisor to the Executive Director on the Board of the World Bank. From March
1998 to November 1999, he was the Private Secretary to the Prime Minister of
India. He was also the Chief of the Office of the Prime Minister. Prior to that
he has held high level positions in the Government of India, including from
January 1998 to March 1998 as a Board Member responsible for Administration in
the Electricity Utility Board of Delhi. From January 1996 to January 1998, he
was the Secretary to the Leader of the Opposition in the lower house of the
Indian Parliament. From December 1995 to May 1996, he was a Director in the
Ministry of Commerce. In 2002, Mr. Sinha earned a M.S. in International Commerce
and Policy from the George Mason University, USA. In 1978 he earned a M.A. in
History from the University of Delhi and in 1976 he earned a BA (Honors) in
Economics from the University of Delhi.





Prabuddha Ganguli has served
as our Special Advisor since May 25, 2005. Since September 1996, Dr. Ganguli has
been the CEO of Vision-IPR. The company offers management consulting on the
protection of intellectual property rights. His clients include companies in the
pharmaceutical, chemical and engineering industries. He is an adjunct professor
of intellectual property rights at the Indian Institute of Technology, Bombay.
Prior to 1996, from August 1991 to August 1996, he was the Head of Information
Services and Patents at the Hindustan Lever Research Center. In
1986, he was elected as a fellow to the Maharashtra Academy of Sciences. In
1966, he received the National Science Talent Scholarship (NSTS). In 1977, he
was awarded the Alexander von Humboldt Foundation Fellow (Germany). He is
Honorary Scientific Consultant to the Principal Scientific Adviser to the
Government of India. He is a Member of the National Expert Group on Issues
linked to Access to Biological materials vis-à-vis TRIPS and CBD Agreements
constituted by the Indian Ministry of Commerce and Industry. He is also a Member
of the Editorial Board of the intellectual property rights journal “World Patent
Information” published by Elsevier Science Limited, UK. He is a Consultant to
the World Intellectual Property Organization (WIPO), Geneva in intellectual
property rights capability building training programs in various parts of the
world. In 1976, Dr. Ganguli received a PhD from the Tata Institute of
Fundamental Research, Bombay in chemical physics. In 1971, he received a M.Sc.
in Chemistry from the Indian Institute of Technology (Kanpur) and in 1969 he
earned a BS from the Institute of Science (Bombay University).





Anil K. Gupta has served as
our Special Advisor since May 25, 2005.  Dr. Gupta has been Professor
of Strategy and Organization at the University of Maryland since
1986.  He has been Chair of the Management & Organization
Department, Ralph J. Tyser Professor of Strategy and Organization, and Research
Director of the Dingman Center for Entrepreneurship at the Robert H. Smith
School of Business, The University of Maryland at College Park, since July
2003.  Dr. Gupta earned a Bachelor of Technology from the Indian
Institute of Technology in 1970, an MBA from the Indian Institute of Management
in 1972, and a Doctor of Business Administration from the
Harvard Business School in 1980.  Dr. Gupta has served on
the board of directors of NeoMagic Corporation (NMGC) since October 2000 and has
previously served as a director of Omega Worldwide (OWWP) from October 1899
through August 2003 and Vitalink Pharmacy Services (VTK) from July 1992 through
July 1999.





Board
of Directors





Our board
of directors is divided into three classes (Class A, Class B and Class C) with
only one class of directors being elected in each year and each class serving a
three-year term. The term of office of the Class A directors, consisting of Mr.
Nathani and Mr. Shenoy, will expire at our fourth annual meeting of
stockholders. The term of office of the Class B directors, consisting of Mr.
Prins and Dr. Krishna, will expire at the second annual meeting of stockholders.
The term of office of the Class C director, consisting of Mr. Mukunda, will
expire at the third annual meeting of stockholders.  These individuals
have played a key role in identifying and evaluating prospective acquisition
candidates, selecting the target businesses, and structuring, negotiating and
consummating the acquisition. The NYSE Alternext, where we are listed, has rules
mandating that the majority of the board be independent.  Our board of
directors will consult with counsel to ensure that the boards of directors’
determinations are consistent with those rules and all relevant securities laws
and regulations regarding the independence of directors. The Alternext listing
standards define an “independent director” generally as a person, other than an
officer of a company, who does not have a relationship with the company that
would interfere with the director’s exercise of independent judgment. Consistent
with these standards, the board of directors has determined that Messrs.
Krishna, Shenoy and Nathani are independent directors.




27
 Table of Contents




Committee
of the Board of Directors





Our Board
of Directors has established an Audit Committee currently composed of two
independent directors who report to the Board of Directors.  Messrs.
Krishna and Shenoy, each of whom is an independent director under the NYSE
Alternext’s listing standards, serve as members of our Audit
Committee.  In addition, we have determined that Messrs. Krishna and
Shenoy are “audit committee financial experts” as that term is defined under
Item 407 of Regulation S-B of the Securities Exchange Act of 1934, as
amended.  The Audit Committee is responsible for meeting with our
independent accountants regarding, among other issues, audits and adequacy of
our accounting and control systems.  We intend to locate and appoint
at least one additional independent director to our Audit Committee to increase
the size of the Audit Committee to three members.





The Audit
Committee will monitor our compliance on a quarterly basis with the terms of our
initial pubic offering.  If any noncompliance issues are identified,
then the Audit Committee is charged with the responsibility to take immediately
all action necessary to rectify such noncompliance or otherwise cause compliance
with our initial pubic offering.  The Board currently does not have a
nominating and corporate governance committee. However, the majority of the
independent directors of the Board make all nominations.




Audit
Committee Financial Expert





The Audit
Committee will at all times be composed exclusively of “independent directors”
who are “financially literate” as defined under the NYSE Alternext listing
standards.  The NYSE Alternext listing standards define “financially
literate” as being able to read and understand fundamental financial statements,
including a company’s balance sheet, income statement and cash flow
statement.





In
addition, we must certify to the NYSE Alternext that the Audit Committee has,
and will continue to have, at least one member who has past employment
experience in finance or accounting, requisite professional certification in
accounting, or other comparable experience or background that results in the
individual’s financial sophistication.  The Board of Directors has
determined that Messrs. Krishna and Shenoy satisfy the NYSE Alternext’s
definition of financial sophistication and qualify as “audit committee financial
experts,” as defined under rules and regulations of the Securities and Exchange
Commission.





Compensation
Committee





Our Board
of Directors has established a Compensation Committee composed of two
independent directors, Messrs. Krishna and Shenoy and one non-independent
director Richard Prins.   The Board determined that Richard Prins
is not a current officer or employee or an immediate family member of such
person.  The Board deemed Mr. Prins to be non-independent because his
firm Ferris Baker Watts received compensation for the IPO and bridge
financing.  The Board, however, determined that the best interests of
the Company and its shareholders require his membership on the compensation
committee, as Mr. Prins brings a great deal of prior experience with memberships
on public compensation committees.  The Board used the exception
provided under Section 805 (b) of the Alternext Company Guide in appointing
Richard Prins to the Compensation Committee.  The compensation
committee’s purpose will be to review and approve compensation paid to our
officers and directors and to administer the Stock Plan.





Nominating
and Corporate Governance Committee





We intend
to establish a nominating and corporate governance committee. The primary
purpose of the nominating and corporate governance committee will be to identify
individuals qualified to become directors, recommend to the board of directors
the candidates for election by stockholders or appointment by the board of
directors to fill a vacancy, recommend to the board of directors the composition
and chairs of board of directors committees, develop and recommend to the board
of directors guidelines for effective corporate governance, and lead an annual
review of the performance of the board of directors and each of its
committees.





We do not
have any formal process for stockholders to nominate a director for election to
our board of directors. Currently, nominations are selected or recommended by a
majority of the independent directors as stated in Section 804 (a) of the
Alternext Company Guide.   Any stockholder wishing to recommend
an individual to be considered by our board of directors as a nominee for
election as a director should send a signed letter of recommendation to the
following address: India Globalization Capital, Inc. c/o Corporate Secretary,
4336 Montgomery Avenue, Bethesda, MD 20817. Recommendation letters must
state the reasons for the recommendation and contain the full name and address
of each proposed nominee as well as a brief biographical history setting forth
past and present directorships, employments, occupations and civic activities. A
written statement should accompany any such recommendation from the proposed
nominee consenting to be named as a candidate and, if nominated and elected,
consenting to serve as a director. We may also require a candidate to furnish
additional information regarding his or her eligibility and qualifications. The
board of directors does not intend to evaluate candidates proposed by
stockholders differently than it evaluates candidates that are suggested by our
board members, execution officers or other sources.





Code
of Conduct and Ethics





We have
adopted a code of conduct and ethics applicable to our directors, officers and
employees in accordance with applicable federal securities laws and the rules of
the NYSE Alternext.  We have filed the code of conduct and ethics as
Exhibit 99.1 to our Registration Statement on Form S-1/A, filed with the
Securities and Exchange Commission on March 2, 2006.





Board
Meetings





During
the fiscal year ended March 31, 2009, our board of directors held fourmeetings. Although we do
not have any formal policy regarding director attendance at our annual meetings,
we attempt to schedule our annual meetings so that all of our directors can
attend. During the fiscal year ended March 31, 2009, all of our directors
attended 100% of the meetings of the board of directors.




28
 Table of Contents




Compensation
of Directors





Our
directors do not currently receive any cash compensation for their service as
members of the board of directors. We anticipate that in the near future we will
pay varying levels of compensation to the current and newly elected non-employee
directors of the Company for their services as directors in the future based on
their eligibility to be members of our audit and compensation committees. We
anticipate determining director compensation in accordance with industry
practice and standards.





We pay
IGN, LLC, an affiliate of Mr. Mukunda, $4,000 per month for office space and
certain general and administrative services.  Mr. Mukunda is the Chief
Executive Officer of IGN, LLC.  We believe, based on rents and fees
for similar services in the Washington, DC metropolitan area that the fee
charged by IGN LLC is at least as favorable as we could have obtained from an
unaffiliated third party.  The agreement is on a month-to-month basis
and may be terminated by the board with out notice.




Section
16 (a) Beneficial Ownership Reporting Compliance





Section
16(a) of the Securities Exchange Act of 1934, as amended, requires our
directors, executive officers and persons who beneficially own more than 10% of
our common stock to file reports of their ownership of shares with the
Securities and Exchange Commission.  Such executive officers,
directors and stockholders are required by SEC regulation to furnish us with
copies of all Section 16(a) reports they file.  Based solely upon
review of the copies of such reports received by us, our senior management
believes that all reports required to be filed under Section 16(a) for the
fiscal year ended March 31, 2009 were filed in a timely manner.




Item11.        Executive
Compensation




Compensation
Discussion and Analysis




Overview
of Compensation Policy




The
Company’s Compensation Committee is empowered to review and approve, or in some
cases recommend for the approval of the full Board of Directors the annual
compensation for the executive officers of the Company. This Committee has the
responsibility for establishing, implementing, and monitoring the Company’s
compensation strategy and policy. Among its principal duties, the Committee
ensures that the total compensation of the executive officers is fair,
reasonable and competitive.




Objectives
and Philosophies of Compensation




The
primary objective of the Company’s compensation policy, including the executive
compensation policy, is to help attract and retain qualified, energetic managers
who are enthusiastic about the Company’s mission and products. The policy is
designed to reward the achievement of specific annual and long-term strategic
goals aligning executive performance with company growth and shareholder value.
In addition, the Board of Directors strives to promote an ownership mentality
among key leaders and the Board of Directors.




Setting
Executive Compensation




The
compensation policy is designed to reward performance. In measuring executive
officers’ contribution to the Company, the Compensation Committee considers
numerous factors including the Company’s growth and financial performance as
measured by revenue, gross margin and net income before taxes among other key
performance indicators.




Regarding
most compensation matters, including executive and director compensation,
management provides recommendations to the Compensation Committee; however, the
Compensation Committee does not delegate any of its functions to others in
setting compensation. The Compensation Committee does not currently engage any
consultant related to executive and/or director compensation
matters.




Stock
price performance has not been a factor in determining annual compensation
because the price of the Company’s common stock is subject to a variety of
factors outside of management’s control. The Company does not subscribe to an
exact formula for allocating cash and non-cash compensation. However, a
significant percentage of total executive compensation is performance-based.
Historically, the majority of the incentives to executives have been in the form
of non-cash incentives in order to better align the goals of executives with the
goals of stockholders.




Elements
of Company’s Compensation Plan




The
principal components of compensation for the Company’s executive officers
are:




·
            base
      salary·
            performance-based
      incentive cash compensation·
            right
      to purchase the company’s stock at a preset price (stock
      options)·
            retirement
      and other benefits




29
 Table of Contents




Base
Salary




The
Company provides named executive officers and other employees with base salary
to compensate them for services rendered during the fiscal year. Base salary
ranges for named executive officers are determined for each executive based on
his or her position and responsibility.




During
its review of base salaries for executives, the Committee primarily
considers:




·
            market
      data;·
            internal
      review of the executives’ compensation, both individually and relative to
      other officers; and·
            individual
      performance of the executive.




Salary
levels are typically evaluated annually as part of the Company’s performance
review process as well as upon a promotion or other change in job
responsibility.




Performance-Based
Incentive Compensation




The
management incentive plan gives the Committee the latitude to design cash and
stock-based incentive compensation programs to promote high performance and
achievement of corporate goals, encourage the growth of stockholder value and
allow key employees to participate in the long-term growth and profitability of
the Company. So that stock-based compensation may continue to be a viable part
of the Company’s compensation strategy, management is currently seeking
shareholder approval of a proposal to increase the number of shares of Company
common stock reserved for issuance pursuant to the Company’s Stock
Plan.




Ownership
Guidelines




To
directly align the interests of the Board of Directors with the interests of the
stockholders, the Committee recommends that each Board member maintain a minimum
ownership interest in the Company. Currently, the Compensation Committee
recommends that each Board member own a minimum of 5,000 shares of the Company’s
common stock with such stock to be acquired within a reasonable time following
election to the Board.




Stock
Option Program




The Stock
Option Program assists the Company to:




·
            enhance
      the link between the creation of stockholder value and long-term executive
      incentive compensation;·
            provide
      an opportunity for increased equity ownership by executives;
      and·
            maintain
      competitive levels of total
compensation.




Stock
option award levels will be determined based on market data and will vary among
participants based on their positions within the Company and are granted at the
Committee’s regularly scheduled meeting. We anticipate that options will be
awarded at the NYSE Alternext’s closing price of the Company’s Common Stock on
the date of the grant. As of March 31, 2009, we had not granted any stock
options under our Stock Plan.




Perquisites
and Other Personal Benefits




The
Company provides some executive officers with perquisites and other personal
benefits that the Company and the Committee believe are reasonable and
consistent with its overall compensation program to better enable the Company to
attract and retain superior employees for key positions. The Committee
periodically reviews the levels of perquisites and other personal benefits
provided to named executive officers.




Some
executive officers are provided use of a company automobiles and an
assistant.  All employees can participate in the plans and programs
described above.




Each
employee of the Company is entitled to term life insurance, premiums for which
are paid by the Company. In addition, each employee is entitled to receive
certain medical and dental benefits and part of the cost is funded by the
employee.




Accounting
and Tax Considerations




The
Company’s stock option grant policy will be impacted by the implementation of
SFAS No. 123R, which was adopted in the first quarter of fiscal year 2006. Under
this accounting pronouncement, the Company is required to value unvested stock
options granted prior to the adoption of SFAS 123 under the fair value method
and expense those amounts in the income statement over the stock option’s
remaining vesting period.




Section
162(m) of the Internal Revenue Code restricts deductibility of executive
compensation paid to the Company’s chief executive officer and each of the four
other most highly compensated executive officers holding office at the end of
any year to the extent such compensation exceeds $1,000,000 for any of such
officers in any year and does not qualify for an exception under Section 162(m)
or related regulations. The Committee’s policy is to qualify its executive
compensation for deductibility under applicable tax laws to the extent
practicable. In the future, the Committee will continue to evaluate the
advisability of qualifying its executive compensation for full
deductibility.




30
 Table of Contents




Compensation
for Executive Officers of the Company





Prior
March 8, 2008, we did not pay any cash compensation to our executive officers or
their affiliates except as follows.   As described above in
“Directors, Executive Officers And Special Advisors of the Company – Director
Compensation”, we pay IGN, LLC, an affiliate of Mr. Mukunda, $4,000 per month
for office space and certain general and administrative services, an amount
which is not intended as compensation for Mr. Mukunda.   On or
around November 27, 2006, we engaged SJS Associates, an affiliate of Mr.
Selvaraj, which provides the services of Mr. John Selvaraj as our
Treasurer.  We have agreed to pay SJS Associates $5,000 per month for
these services.  Mr. Selvaraj is the Chief Executive Officer of SJS
Associates.  Effective November 1, 2007 the Company and SJS Associates
terminated the agreement.  We subsequently entered into a new
agreement with SJS Associates on identical terms subsequent to the acquisition
of Sricon and TBL. On May 22, 2008, the Company and its subsidiary India
Globalization Capital Mauritius  (“IGC-M”) entered into an employment
agreement (the “Employment Agreement”) with Ram Mukunda, pursuant to which he
will receive a salary of $300,000 per year for services to IGC and IGC-M as
Chief Executive Officer.   The Employment Agreement was approved
in May 2008 and made effective as of March 8, 2008.  For fiscal year
2009, Mr. Mukunda was paid $300,000.





The
annual executive compensation for the Chief Executive Officer and Chief
Financial Officer of the Company is set out below.





Summary
      compensationFY
      2008
                        
                        
                        FY
      2009Ram
      Mukunda
                        
                        $
                        15,000
                        
                        
                        $
                        450,000John
      Selvaraj
                        
                        $
                        35,000
                        
                        
                        $
                        63,300




Compensation
for Executive Officers of Sricon





The
annual executive compensation for the Chairman and Managing Director of Sricon
is set out below.  The USD amounts are shown at a conversion rate of
INR 50.64 to USD 1.




Summary compensation of
      executive of SriconFY
      2008
                
                FY
      2009Mr.
      R Srivastava
                
                $
                INR
      600,000
                
                $
                INR
      6,000,000$
                USD15,000
                
                $
                USD
      118,494





Compensation
for Executive Officers of TBL





The
annual executive compensation for the Managing Director of TBL is set out
below.  The USD amounts are shown at a conversion rate of INR 50.64 to
USD 1 andINR 40 to USD 1 for 2009 and 2008
respectively.





Summary compensation of
      executive of TBLFY
      2008
                      
                      FY
      2009Mr.
      Jortin Antony
                      
                      INR
      480,000
                      
                      INR
      657,000USD
      12,000
                      
                      USD
      12,975




Compensation
of Directors




No
compensation was paid to the Company’s Board of Directors for the one-year
period ended March 31, 2009.




Certain
Relationships and Related Transactions




As of
March 31, 2009, there were no related party transactions other than the
agreements with IGN, an affiliate of Ram Mukunda, and SJS Associates, an
affiliate of John Selvaraj, described above. We are party to indemnification
agreements with each of the executive officers and directors. Such
indemnification agreements require us to indemnify these individuals to the
fullest extent permitted by law.




Employment
Contracts




Ram
Mukunda has served as President and Chief Executive Officer of the Company since
its inception.  The Company, IGC-M and Mr. Mukunda entered into an
Employment Agreement on May 22, 2008, which agreement was made effective as of
March 8, 2008, the date on which the Company completed its acquisition of Sricon
and TBL. Pursuant to the agreement, the Company pays Mr. Mukunda a base salary
of $300,000 per year. Mr. Mukunda is also entitled to receive bonuses of at
least $225,000 for meeting certain targets for net income (before one time
charges including charges for employee options, warrants and other items) for
fiscal year 2009and  $150,000
for meeting targets with respect to obtaining new contracts.  The
Agreement further provides that the Board of Directors of the Company may review
and update the targets and amounts for the net revenue and contract bonuses on
an annual basis.  The Agreement also provides for benefits, including
insurance, 20 days of paid vacation, a car (subject to partial reimbursement by
Mr. Mukunda of lease payments for the car) and reimbursement of business
expenses. The term of the Employment Agreement is five years, after which
employment will become at-will. The Employment Agreement is terminable by the
Company and IGC-M for death, disability and cause.  In the event of a
termination without cause, the Company would be required to pay Mr. Mukunda his
full compensation for 18 months or until the term of the Employment Agreement
was set to expire, whichever is earlier.




31
 Table of Contents




In
partial consideration for the equity shares in Sricon purchased by the Company,
pursuant to the terms of a Shareholders Agreement dated as of September 15, 2007
by and among IGC, Sricon and the Promoters or Sricon, the stockholders of Sricon
as of the date of the acquisition, including Ravindra Lal Srivastava, who
currently serves as the Chairman and Managing Director of Sricon, shall have the
right to receive up to an aggregate of 418,431 equity shares of Sricon over a
three-year period if Sricon achieves certain profit after tax targets for its
2008-2010 fiscal years.  The maximum number of shares the Promoters
may receive in any given fiscal year is 139,477 shares.  If Sricon’s
profits after taxes for a given fiscal year are less than 100% of the target for
that year but are equal to at least 85% of the target, the Promoters shall
receive a pro rated portion of the maximum share award for that fiscal
year.  A copy of this agreement was filed with the SEC in the
Company’s definitive proxy statement filed February 8, 2008 and is incorporated
here by reference.





In
partial consideration for the equity shares in TBL purchased by the Company,
pursuant to the terms of a Shareholders Agreement dated as of September 16, 2007
by and among IGC, TBL and the Promoters of TBL, Jortin Anthony, who currently
serves as the Managing Director of TBL, shall have the right to
receive  up to an aggregate of 1,204,000 equity shares of TBL over a
five-year period if TBL achieves certain profit after tax targets for its
2008-2012 fiscal years.   The maximum number of shares Mr.
Anthony may receive is 140,800 shares for fiscal year 2008 and 265,800 shares
for each of the following fiscal years.  If TBL’s profits after taxes
for a given fiscal year are less than 100% of the target for that year but are
equal to at least 85% of the target Mr. Anthony shall receive a pro rated
portion of the maximum share award for that fiscal year.  A copy of
this agreement was filed with the SEC in the Company’s definitive proxy
statement filed February 8, 2008 and is incorporated here by
reference.




Compensation
Committee Interlocks and Insider Participation




A
Compensation Committee comprised of two independent members of the Board of
Directors, Ranga Krishna and Sudhakar Shenoy, and a non-independent director
Richard Prins, administer executive compensation.  No executive
officer of the Company served as a director or member of the compensation
committee of any other entity.




Item12.        Security
Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters





The
following table sets forth information regarding the beneficial ownership of our
common stock as of June 30, 2009 by:





•
            each
      person known by us to be the beneficial owner of more than 5% of our
      outstanding shares of common stock;




•
            each
      of our executive officers, directors and our special advisors;
      and




•
            all
      of our officers and directors as a
group.





Beneficial
ownership is determined in accordance with the rules of the Securities and
Exchange Commission and does not necessarily indicate beneficial ownership for
any other purpose. Under these rules, beneficial ownership includes those shares
of common stock over which the stockholder has sole or shared voting or
investment power. It also includes shares of common stock that the stockholder
has a right to acquire within 60 days through the exercise of any option,
warrant or other right. The percentage ownership of the outstanding common
stock, which is based upon 10,091,971 shares of common stock outstanding as of
June 30, 2009, is based on the assumption, expressly required by the rules of
the Securities and Exchange Commission, that only the person or entity whose
ownership is being reported has converted options or warrants into shares of our
common stock.





Unless
otherwise indicated, we believe that all persons named in the table have sole
voting and investment power with respect to all shares of common stock
beneficially owned by them. Unless otherwise noted, the nature of the ownership
set forth in the table below is common stock of the Company.





32
 Table of Contents




The table
below sets forth as of June 30, 2009, except as noted in the footnotes to the
table, certain information with respect to the beneficial ownership of the
Company’s Common Stock by (i) all persons known by the Company to be the
beneficial owners of more than 5% of the outstanding Common Stock of the
Company, (ii) each director and director-nominee of the Company, (iii) the
executive officers named in the Summary Compensation Table, and (iv) all such
executive officers and directors of the Company as a group.




Shares
      OwnedName and Address of Beneficial
      Owner(1)
                                                                    
                                                                    Number
      of Shares
                                                                    
                                                                    
                                                                    Percentage
      of ClassWachovia
      Corporation (2)
                                                                      One
      Wachovia Center
                                                                      Charlotte,
      North Carolina 28288-0137
                                                                    
                                                                    
                                                                    1,879,289
                                                                    
                                                                    
                                                                    
                                                                    18.6
                                                                    %Sage
      Master Investments Ltd (3)
                                                                      500
      Fifth Avenue, Suite 930
                                                                      New
      York, New York 10110
                                                                    
                                                                    
                                                                    947,300
                                                                    
                                                                    
                                                                    
                                                                    9.4
                                                                    %Brightline
      Capital Management, LLC (4)
                                                                      1120
      Avenue of the Americas, Suite 1505
                                                                      New
      York, New York 10036
                                                                    
                                                                    
                                                                    750,000
                                                                    
                                                                    
                                                                    
                                                                    7.4
                                                                    %Professional
      Offshore Opportunity Fund, Ltd. (5)
                                                                      1400
      Old Country Road, Suite 206
                                                                      Westbury,
      New York 11590
                                                                    
                                                                    
                                                                    737,567
                                                                    
                                                                    
                                                                    
                                                                    7.3
                                                                    %APG
      Capital, LP (6)
                                                                      12
      Greenway Plaza,
                                                                      Suite
      1100
                                                                      Houston,
      Texas 77046
                                                                    
                                                                    
                                                                    622,069
                                                                    
                                                                    
                                                                    
                                                                    6.2
                                                                    %Chestnut
      Ridge Partners, LP (7)
                                                                      50
      Tice Boulevard
                                                                      Woodcliff
      Lake, NJ 07677
                                                                    
                                                                    
                                                                    564,335
                                                                    
                                                                    
                                                                    
                                                                    5.6
                                                                    %Pine
      River Capital Management L.P. (8)
                                                                      601
      Carlson Parkway
                                                                      Suite
      330
                                                                      Minnetonka,
      MN 55305
                                                                    
                                                                    
                                                                    174,976
                                                                    
                                                                    
                                                                    
                                                                    1.7
                                                                    %Nisswa
      Acquisition Master Fund Ltd. (9)
                                                                      601
      Carlson Parkway
                                                                      Suite
      330
                                                                      Minnetonka,
      MN 55305
                                                                    
                                                                    
                                                                    107,976
                                                                    
                                                                    
                                                                    
                                                                    1.1
                                                                    %UBS
      AG
                                                                      Bahnhofstrasse
      45
                                                                      CH-8001,
      Zurich, Switzerland
                                                                    
                                                                    
                                                                    31,506
                                                                    
                                                                    
                                                                    
                                                                    *Ram
      Mukunda (10)
                                                                    
                                                                    
                                                                    1,449,914
                                                                    
                                                                    
                                                                    
                                                                    14.4
                                                                    %Ranga
      Krishna (11)
                                                                    
                                                                    
                                                                    2,215,624
                                                                    
                                                                    
                                                                    
                                                                    22.0
                                                                    %Steven
      M. Oliveira (12)
                                                                    
                                                                    
                                                                    270,833
                                                                    
                                                                    
                                                                    
                                                                    2.7
                                                                    %Richard
      Prins (13)
                                                                    
                                                                    
                                                                    196,250
                                                                    
                                                                    
                                                                    
                                                                    1.9
                                                                    %Sudhakar
      Shenoy
                                                                    
                                                                    
                                                                    175,000
                                                                    
                                                                    
                                                                    
                                                                    1.7
                                                                    %Suhail
      Nathani
                                                                    
                                                                    
                                                                    150,000
                                                                    
                                                                    
                                                                    
                                                                    1.5
                                                                    %Paradigm
      Capital
                                                                    
                                                                    
                                                                    11,400
                                                                    
                                                                    
                                                                    
                                                                    *Larry
      Pressler
                                                                    
                                                                    
                                                                    25,000
                                                                    
                                                                    
                                                                    
                                                                    *Dr.
      Anil K. Gupta
                                                                    
                                                                    
                                                                    25,000
                                                                    
                                                                    
                                                                    
                                                                    *Steven
      S. Taylor, Jr.
                                                                    
                                                                    
                                                                    20,000
                                                                    
                                                                    
                                                                    
                                                                    *P.G.
      Kakodkar
                                                                    
                                                                    
                                                                    12,500
                                                                    
                                                                    
                                                                    
                                                                    *Shakti
      Sinha
                                                                    
                                                                    
                                                                    12,500
                                                                    
                                                                    
                                                                    
                                                                    *Dr.
      Prabuddha Ganguli
                                                                    
                                                                    
                                                                    12,500
                                                                    
                                                                    
                                                                    
                                                                    *All
      Executive Officers and Directors as a group (5
      Persons)(14)
                                                                    
                                                                    
                                                                    4,221,496
                                                                    
                                                                    
                                                                    
                                                                    41.8
                                                                    %





*
Represents less than 1%




33
 Table of Contents




(1)
            Unless
      otherwise indicated, the address of each of the individuals listed in the
      table is: c/o India Globalization Capital, Inc., 4336 Montgomery Avenue,
      Bethesda, MD 20814.(2)
            Based
      on a Schedule 13F filed with the SEC on March 31, 2009 by Wachovia
      Corporation.   Dr. Ranga Krishna is entitled to 100% of the
      economic benefits of the shares.(3)
            Based
      on a Schedule 13G filed with the SEC on May 21, 2009 by Sage Master
      Investments Ltd., a Cayman Islands exempted company (“Sage Master”), Sage
      Opportunity Fund (QP), L.P., a Delaware limited partnership (“QP Fund”),
      Sage Asset Management, L.P., a Delaware limited partnership (“SAM”), Sage
      Asset Inc., a Delaware corporation (“Sage Inc.”), Barry G. Haimes and
      Katherine R. Hensel (collectively, the “Reporting Persons”). As
      disclosed in the Schedule 13G, Each of the Reporting Persons’ beneficial
      ownership of 947,300 shares of Common Stock constitutes 9.4% of all of the
      outstanding shares of Common Stock. The address for each of the foregoing
      parties is c/o 500 Fifth Avenue, Suite 930, New York, New York
      10110.(4)
            Based
      on an amended Schedule 13G jointly filed with the SEC on May 28, 2008 by
      Brightline Capital Management, LLC (“Management”), Brightline Capital
      Partners, LP (“Partners”), Brightline GP, LLC (“GP”), Nick Khera (“Khera”)
      and Edward B. Smith, III (“Smith”).  As disclosed in the amended
      Schedule 13G, Management and Khera are each the beneficial owners of
      750,000 shares of common stock (8.75%), Smith is the beneficial owner of
      1,031,500 shares of common stock (12.04%) including 281,500 shares over
      which he holds sole control of their voting and disposition, and Partners
      and GP are each the beneficial owners of 592,560 shares of common stock
      (6.91%), respectively.  The address for
      each of the foregoing parties is 1120 Avenue of the Americas, Suite 1505,
      New York, New York 10036.(5)
            Based
      on a Schedule 13G jointly filed with the SEC on February 9, 2009 by
      Professional Offshore Opportunity Fund, Ltd., a British Virgin Islands
      company. As disclosed in the Schedule 13G, The company directly
      beneficially owns 737,567shares of common stock which constitutes 7.3% of
      all of the outstanding shares of Common Stock. The address for each of the
      foregoing parties is 1400 Old Country Road, Suite 206, Westbury, New York
      11590.(6)
            Based
      on a Schedule 13G jointly filed with the SEC on February 17, 2009 by
      APG Capital, LP, a Delaware limited partnership (the “Fund”), APG Capital
      Partners, LP,a Delaware limited partnership (“APG Capital Partners”),
      which serves as the general partner of the Fund, APG Capital Management,
      LLC, a Delaware limited liability company (“APG Capital Management”),
      which serves as the investment manager of the Fund and the general partner
      of APG Capital Partners, and (iv) Adam Gross, the managing member of APG
      Capital Management (all of the foregoing, collectively, the “Filers”). As
      disclosed in the Schedule 13G, The Fund directly beneficially owns 622,069
      shares of common stock which constitutes 6.2% of all of the outstanding
      shares of Common Stock.The
      address for each of the foregoing parties is12
      Greenway Plaza, Suite 1100, Houston, Texas 77046.(7)
            Based
      on a Schedule 13G filed with the SEC on January 9, 2009 by Chestnut
      Ridge Partners, LP. As disclosed in the Schedule 13G, The Fund directly
      beneficially owns 564,335shares of common stock which constitutes 5.6% of
      all of the outstanding shares of Common Stock.  The business
      address for Chestnut Ridge Partners, LP is 50 Tice Boulevard, Woodcliff
      Lake, NJ 07677.(8)
            Based
      on a Schedule 13F filed with the SEC on March 31, 2009 by Pine River
      Capital Management L.P., a Delaware limited partnership. As disclosed in
      the Schedule 13F, The Fund directly beneficially owns 174,976 shares of
      common stock which constitutes 1.7% of all of the outstanding shares of
      Common Stock. The address for each of the foregoing parties is 601 Carlson
      Parkway, Suite 330, Minnetonka, MN 55305.(9)
            Based
      on a Form 4 filed with the SEC on January 6, 2009 Nisswa Acquisition
      Master Fund Ltd., a Cayman Islands limited partnership. As disclosed in
      the Form 4, The Fund directly beneficially owns 107,024 shares of common
      stock which constitutes 1.1% of all of the outstanding shares of Common
      Stock. The address for Nisswa Acquisition is 601 Carlson Parkway Suite
      330, Minnetonka, MN 55305(10)
            Includes 594,924
      shares of common stock and warrants to purchase 779,739 shares of common
      stock which are exercisable within sixty (60) days of July 13, 2009, all
      of which are currently exercisable.  Excludes shares which Mr.
      Mukunda is required to transfer to certain individuals pursuant to the
      Share Redistribution Agreement, the transfer of which shares is currently
      in process.(11)
            Includeswarrants to
      purchase 290,000 shares of common stock which are exercisable within sixty
      (60) days of October 9, 2008, all of which are currently
      exercisable.  Includes 1,650,977 shares beneficially owned by
      Wachovia Corporation, which has sole voting and dispositive control over
      the shares.   Dr. Krishna is entitled to 100% of the
      economic benefits of the shares.   Excludes shares which
      Dr. Krishna is required to transfer to certain individuals pursuant to the
      Share Redistribution Agreement, the transfer of which shares is currently
      in process.(12)
            Based on a Schedule 13D filed
      with the SEC on May 21, 2009 by Steven M Oliveira.  Steven
      M Oliveira directly beneficially owns 270,833 shares of common stock which
      constitutes 2.7% of all of the outstanding shares of Common Stock. The
      business address for Steven M Oliveira is18 Fieldstone Court, New City, NY
      10956.(13)
            Based
      on a Form 4 filed with the SEC on May 18, 2009 by Richard
      Prins.  Richard Prins directly beneficially owns 196,250 shares
      of common stock which constitutes 1.9% of all of the outstanding shares of
      Common Stock.(14)
            Does
      not include shares owned by our special advisors.  Includes
      1,879,289 shares beneficially owned by Wachovia Corporation, which has
      sole voting and dispositive control over the
  shares.





Messrs.
Mukunda and Krishna may be deemed our “parent,” “founder” and “promoter,” as
these terms are defined under the Federal securities laws.




Securities
Authorized for Issuance Under Equity Compensation Plans





As of
March 31, 2009 there were 1,513,675 shares authorized for issuance under the
2008 Omnibus Incentive Plan.  No shares or options have been granted
as of March 31, 2009.




34
 Table of Contents




Item13. Certain Relationships and Related Transactions, and
Director Independence




Review,
Approval or Ratification of Related Party Transactions





We do not
maintain a formal written procedure for the review and approval of transactions
with related persons.  It is our policy for the disinterested members
of our board to review all related party transactions on a case-by-case
basis.  To receive approval, a related-party transaction must have a
business purpose for IGC and be on terms that are fair and reasonable to IGC and
as favorable to IGC as would be available from non-related entities in
comparable transactions.





Prior
Share Issuances





On May 5,
2005, we issued 1,750,000 shares for an aggregate consideration of $17,500 in
cash, at an average purchase price of approximately $.01 per share, as
follows:




Name
                
                Number of Shares (1)
                
                Relationship to UsDr.
      Ranga Krishna
                
                
                250,000
                
                Chairman
      of the BoardRam
      Mukunda
                
                
                1,250,000
                
                Chief
      Executive Officer, President and DirectorJohn
      Cherin
                
                
                250,000
                
                Chief
      Financial Officer and Director
(2)





On June
20, 2005, we issued 750,000 shares for an aggregate consideration of $7,500 in
cash, at a purchase price of approximately $.01 per share, as
follows:





Name
                
                Number
      of Shares
                  (1) (3) (4)
                
                Relationship to UsParveen
      Mukunda (5)
                
                
                425,000
                
                SecretarySudhakar
      Shenoy
                
                
                37,500
                
                DirectorSuhail
      Nathani
                
                
                37,500
                
                DirectorShakti
      Sinha
                
                
                12,500
                
                Special
      AdvisorPrabuddha
      Ganguli
                
                
                12,500
                
                Special
      AdvisorAnil
      K. Gupta
                
                
                25,000
                
                Special
      Advisor





(1)         The
share numbers and per share purchase prices in this section reflect the effects
of a 1-for-2 reverse split effected September 29, 2005.





(2)         John
Cherin resigned as our CFO, Treasurer, and Director on November 27,
2006.





(3)         The
shares were issued to our officers, directors and Special Advisors in
consideration of services rendered or to be rendered to us.





(4)         On
September 7, 2005, one stockholder surrendered to us 62,500 shares, and on
February 3, 2006, a stockholder surrendered to us 137,500 shares. These were
reissued as set forth below.





(5)         Parveen
Mukunda is the wife of Ram Mukunda.




On
February 3, 2006, we reissued the 200,000 shares for an aggregate consideration
of $2,000 in cash at a price of approximately $.01 per share as
follows:





Name
                
                Number of Shares
                
                Relationship to UsDr.
      Ranga Krishna
                
                
                100,000
                
                Chairman
      of the BoardJohn
      Cherin
                
                
                37,500
                
                Chief
      Financial Officer, Treasurer and DirectorLarry
      Pressler
                
                
                25,000
                
                Special
      AdvisorP.G.
      Kakodkar
                
                
                12,500
                
                Special
      AdvisorSudhakar
      Shenoy
                
                
                12,500
                
                DirectorSuhail
      Nathani
                
                
                12,500
                
                Director




The
holders of the majority of these shares will be entitled to make up to two
demands that we register these shares pursuant to an agreement to be signed
prior to or on the date of this prospectus. The holders of the majority of these
shares can elect to exercise these registration rights at any time after the
date on which the lock-up period expires. In addition, these stockholders have
certain “piggy-back” registration rights on registration statements filed
subsequent to such date. We will bear the expenses incurred in connection with
the filing of any such registration statements.





Mr.
Mukunda and certain of our other officers and directors collectively purchased
in the aggregate 170,000 units in a private placement immediately prior to the
IPO of IGC’s units at a price equal to the offering price of the IPO, $6.00 per
unit.




35
 Table of Contents




On
December 24, 2007 Dr. Krishna, our Chairman of the Board, entered into a Note
Purchase Agreement with us pursuant to which we agreed to issue him 446,226
shares of our common stock within 10 days of the consummation of the Acquisition
as partial consideration for a $4,300,000 loan made by Dr. Krishna to the
Company.





Pursuant
to the consummation of the Acquisitions, Dr. Krishna was issued the shares.
These shares are entitled to the registration rights described
above.





On March
7, 2008 Messrs. Mukunda and Krishna entered into an agreement with third parties
to transfer on or after September 8, 2008 pursuant to the terms of certain Share
Redistribution Agreements an aggregate of 1,368,031 shares, which amount was
increased to 1,418,508 by a letter agreement executed by Messrs. Mukunda and
Krishna on September 24, 2008. Specifically, as modified the letter agreement,
Mr. Mukunda agreed to transfer 1,156,820 shares and Dr. Krishna agreed to
transfer 261,688 shares. The purpose of the agreements were to induce such third
parties to acquire shares of the Company's common stock and to cause such shares
to be voted in favor of the Company’s acquisition.





On August
15, 2008, the Company issued 10,000 shares of its common stock to RedChip
Companies, Inc. as payment for services in a private placement. This transaction
was exempt from registration under the Securities Act pursuant to Section 4(2)
of the Securities Act, which exempts private issuances of securities in which
the securities are not offered or advertised to the general public. No
underwriting discounts or commissions were paid with respect to such
sale.





On
September 30, 2008, the Company entered into a Note and Share Purchase Agreement
with Steven M. Oliveira 1998 Charitable Remainder Unitrust (“Oliveira Trust”)
pursuant to which the Company sold the Oliveira Trust a Promissory Note in the
principal amount of $2,000,000 and 200,000 shares of common stock of the
Company. The Promissory Note is due and payable on September 30, 2009, or upon
an earlie change in control of the Company, and bears interest at a rate of 6%
per annum. The Note and Share Purchase Agreement, provides for the issuance by
the Company of additional shares of its Common Stock to the Oliveira Trust for
no additional consideration as follows: if an event of default under the
Promissory Note remains uncured for a period of more than 30 days, the Company
shall issue to the Oliveira Trust an additional 10,000 shares of Common Stock
for each $100,000 of outstanding principal amount of the Promissory Note and if
the Company fails to file a registration statement covering the resale Common
Stock within 45 days after the sale of the Promissory Note and Common Stock to
the Oliveira Trust or such registration statement is not declared effective
within 150 days after filing (subject to certain exceptions and extensions) the
Company shall issue to the Oliveira Trust an additional 25,000 shares of Common
Stock for each $100,000 of outstanding principal amount of the Promissory Note
and an additional 5,000 shares for each $100,000 of outstanding principal amount
of the Promissory Note for each subsequent 30 day period such registration
statement is not declared effective, These transactions were exempt from registration
under the Securities Act pursuant to Regulation D promulgated under the
Securities Act, which exempts private issuances of securities in which the
securities are not offered or advertised to the general public. No underwriting
discounts or commissions were paid with respect to such sales.





On January 9, 2009 the company issued
2,706,350 shares of common stock in exchange for 11,943,878
warrants.  The issuance of the shares was pursuant to a warrant tender
offer that the Company made to all the warrant and unit
holders.





As of
March 31, 2009, there were no related party transactions other than the
agreements with IGN, an affiliate of Ram Mukunda, and SJS Associates, an
affiliate of John Selvaraj. We are party to indemnification agreements with each
of the executive officers and directors. Such indemnification agreements require
us to indemnify these individuals to the fullest extent permitted by
law.





Director
Independence





We are
listed on an exchange that requires its listed companies to have independent
directors.  The Board of Directors has made the determination that
Messrs. Krishna, Shenoy and Nathani are independent directors




Messrs.
Mukunda and Krishna may be deemed to be our “parent,” “founder” and “promoter,”
as these terms are defined under the Federal securities laws.




Item14.        Principal
Accountant Fees and Services.





Effective
May 5, 2008  the Firm of Yoganandh & Ram (“Y & R”), Chartered
Accountants, independent registered public accounting firm, in India, registered
with the Public Company Accounting Oversight Board (PCAOB) were appointed as our
principal accountant.





Through
January 25, 2008, the firm of Goldstein Golub Kessler LLP (“GGK”) acted as our
principal accountant. On January 25, 2008 we were notified by GGK that their
partners had become partners of McGladrey and Pullen, LLP (“McGladrey”), and we
engaged McGladrey as our new principal accountant.  On March 7, 2008
IGC’s shareholders approved the acquisitions of Sricon and TBL.  With
these acquisitions, most of our operations are now based in India and our Board
of Directors made the decision to retain an auditor based in
India.  Effective May 5, 2008, the Audit Committee of IGC dismissed
McGladrey and appointed Y & R.




36
 Table of Contents




Audit Related and Other
Fees





The Audit
and other fees paid are below:





March
      31, 2009
                          
                          
                          March
      31, 2008Audit
      Fees – GGK
                          
                          $
                          0
                          
                          
                          $
                          65,019Audit
      Fees – McGladrey
                          
                          
                          13,708
                          
                          
                          
                          31,343Audit
      Fees - Yoganandh & Ram
                          
                          
                          38,448
                          
                          
                          
                          0Tax
      Fees (1)
                          
                          
                          9,430
                          
                          
                          
                          5,095All
      other Fees
                          
                          
                          5,520
                          
                          
                          
                          0Total
                          
                          $
                          67,106
                          
                          
                          $
                          101,457





(1) Tax
Fees relate to tax compliance, tax planning and advice.  These
services include tax return preparation and advice on state and local tax
issues.




Audit Committee
Approval




Policy on
Pre-Approval of Audit and Permissible Non-audit Services of Independent
Auditors




Consistent
with SEC policies regarding auditor independence, the audit committee of
our board of directors has responsibility for appointing, setting compensation
and overseeing the work of the independent auditor. In recognition of this
responsibility, our board of directors has established a policy to pre-approve
all audit and permissible non-audit services provided by the independent
auditor.




Prior to
engagement of the independent auditor for the next year’s audit, management will
submit an aggregate of services expected to be rendered during that year for
each of the following four categories of services to our board of directors for
approval.




1. Audit services include
audit work performed in the preparation of financial statements, as well as work
that generally only the independent auditor can reasonably be expected to
provide, including comfort letters, statutory audits, and attest services and
consultation regarding financial accounting and/or reporting
standards.




2. Audit-Related services
are for assurance and related services that are traditionally performed by the
independent auditor, including due diligence related to mergers and
acquisitions, employee benefit plan audits, and special procedures required to
meet certain regulatory requirements.




3. Tax services include all
services performed by the independent auditor’s tax personnel except those
services specifically related to the audit of the financial statements, and
includes fees in the areas of tax compliance, tax planning, and tax
advice.




Other Fees are those
associated with services not captured in the other
categories.




Prior to
engagement, our board of directors pre-approves these services by category of
service. The fees are budgeted and our board of directors requires the
independent auditor and management to report actual fees versus the budget
periodically throughout the year by category of service. During the year,
circumstances may arise when it may become necessary to engage the independent
auditor for additional services not contemplated in the original pre-approval.
In those instances, our board of directors requires specific pre-approval before
engaging the independent auditor.




Our audit
committee may delegate pre-approval authority to one or more of its members. The
member to whom such authority is delegated must report, for informational
purposes only, any pre-approval decisions to our board of directors at its next
scheduled meeting.




37
 Table of Contents




PART
IV


Item15.      
 Exhibits




The
following exhibits are filed as part of, or are incorporated by reference into,
this report:





(a)
Financial Statements





Our
financial statements as set forth in the Index to Financial Statements attached
hereto commencing on page F-1 are hereby incorporated by reference.





(b)
Exhibits.




The
exhibits listed in the accompanying index to exhibits are filed or incorporated
by reference as part of this Annual Report on Form 10-K.




3.1
            
            Amended
      and Restated Articles of Incorporation. (1)3.2
            
            By-laws.
      (2)4.1
            
            Specimen
      Unit Certificate. (3)4.2
            
            Specimen
      Common Stock Certificate. (3)4.3
            
            Specimen
      Warrant Certificate. (3)4.4
            
            Form
      of Warrant Agreement between Continental Stock Transfer & Trust
      Company and the Registrant. (1)4.5
            
            Form
      of Purchase Option to be granted to the Representative.
  (1)10.1
            
            Amended
      and Restated Letter Agreement between the Registrant, Ferris, Baker Watts,
      Inc. and Ram Mukunda. (4)10.2
            
            Amended
      and Restated Letter Agreement between the Registrant, Ferris, Baker Watts,
      Inc. and John Cherin. (4)10.3
            
            Amended
      and Restated Letter Agreement between the Registrant, Ferris, Baker Watts,
      Inc. and Ranga Krishna. (4)10.4
            
            Form
      of Investment Management Trust Agreement between Continental Stock
      Transfer & Trust Company and the Registrant. (5)10.5
            
            Promissory
      Note issued by the Registrant to Ram Mukunda. (2)10.5.1
            
            Extension
      of Due Date of Promissory Note issued to Ram Mukunda.
  (2)10.6
            
            Form
      of Stock and Unit Escrow Agreement among the Registrant, Ram Mukunda, John
      Cherin and Continental Stock Transfer & Trust Company.
    (2)10.7
            
            Form
      of Registration Rights Agreement among the Registrant and each of the
      existing stockholders. (3)10.8
            
            Form
      of Unit Purchase Agreement among Ferris, Baker Watts, Inc. and one or more
      of the Initial Stockholders. (5)10.9
            
            Form
      of Office Service Agreement between the Registrant and Integrated Global
      Networks, LLC. (5)10.10
            
            Amended
      and Restated Letter Advisory Agreement between the Registrant, Ferris,
      Baker Watts, Inc. and SG Americas Securities, LLC. (5)10.11
            
            Form
      of Letter Agreement between Ferris, Baker Watts, Inc. and certain officers
      and directors of the Registrant. (4)10.12
            
            Form
      of Letter Agreement between Ferris, Baker Watts, Inc. and each of the
      Special Advisors of the Registrant. (4)10.13
            
            Form
      of Letter Agreement between the Registrant and certain officers and
      directors of the Registrant. (4)10.14
            
            Form
      of Letter Agreement between the Registrant and each of the Special
      Advisors of the Registrant. (4)10.15
            
            Promissory
      Note issued by the Registrant to Ranga Krishna. (2)10.15.1
            
            Extension
      of Due Date of Promissory Note issued to Ranga Krishna.
  (2)10.16
            
            Form
      of Promissory Note to be issued by the Registrant to Ranga Krishna.
      (2)10.17
            
            Share
      Subscription Cum Purchase Agreement dated February 2, 2007 by and
      among India Globalization Capital, Inc., MBL Infrastructures Limited and
      the persons “named as Promoters therein”. (6)10.18
            
            Debenture
      Subscription Agreement dated February 2, 2007 by and among India
      Globalization Capital, Inc., MBL Infrastructures Limited and the persons
      named as Promoters therein. (6)10.19
            
            Note
      and Warrant Purchase Agreement dated February 5, 2007 by and among
      India Globalization Capital, Inc. and Oliviera Capital, LLC.
      (6)10.20
            
            Promissory
      Note dated February 5, 2007 in the initial principal amount for
      $3,000,000 issued by India Globalization Capital, Inc. to Oliviera
      Capital, LLC. (6)10.21
            
            Warrant
      to Purchase Shares of Common Stock of India Globalization Capital, Inc.
      issued by India Globalization Capital, Inc. to Oliviera Capital, LLC.
      (6)10.22
            
            First
      Amendment to Share Subscription Cum Purchase Agreement dated February 2,
      2007 by and among India Globalization Capital, Inc., MBL Infrastructures
      Limited and the persons named as Promoters therein. (7)10.23
            
            First
      Amendment to the Debenture Subscription Agreement dated February 2, 2007
      by and among India Globalization Capital, Inc., MBL Infrastructures
      Limited and the persons named as Promoters therein. (7)10.24
            
            Contract
      Agreement dated April 29, 2007 between IGC, CWEL, AMTL and MAIL.
      (7)10.25
            
            First
      Amendment dated August 20, 2007 to Agreement dated April 29, 2007 between
      IGC, CWEL, AMTL and MAIL. (8)10.26
            
            Share
      Subscription Cum Purchase Agreement dated September 16, 2007 by and among
      India Globalization Capital, Inc., Techni Barathi Limited and the persons
      named as Promoters therein (9).10.27
            
            Shareholders
      Agreement dated September 16, 2007 by and among India Globalization
      Capital, Inc., Techni Barathi Limited and the persons named as Promoters
      therein. (9)10.28
            
            Share
      Purchase Agreement dated September 21, 2007 by and between India
      Globalization Capital, Inc. and Odeon Limited. (9)10.29
            
            Share
      Subscription Cum Purchase Agreement dated September 15, 2007 by and among
      India Globalization Capital, Inc.,  Sricon Infrastructure
      Private Limited and the persons named as Promoters therein.
      (9)10.30
            
            Shareholders
      Agreement dated September 15, 2007 by and among India Globalization
      Capital, Inc.,  Sricon Infrastructure Private Limited and the
      persons named as Promoters therein. (9)10.31
            
            Form
      of Amendment to the Share Subscription Cum Purchase Agreement Dated
      September 15, 2007, entered into on December 19, 2007 by and among India
      Globalization Capital, Inc., Sricon Infrastructure Private Limited and the
      persons named as Promoters therein. (10)10.32
            
            Form
      of Amendment to the Share Subscription Agreement Dated September 16, 2007,
      entered into on December 21, 2007 by and among India Globalization
      Capital, Inc., Techni Bharathi Limited and the persons named as Promoters
      therein. (10)10.33
            
            Note
      Purchase Agreement, effective as of December 24, 2007, by and among India
      Globalization Capital, Inc. and the persons named as Lenders therein.
      (10)10.34
            
            Form
      of India Globalization Capital, Inc. Promissory Note.
  (10)




38
 Table of Contents





10.35
            
            Form
      of Registration Rights Agreement by and among India Globalization Capital,
      Inc. and the persons named as Investors therein. (10)10.36
            
            Form
      of Pledge Agreement, effective as of December 24, 2007, by and among India
      Globalization Capital, Inc. and the persons  named as
      Secured Parties therein. (10)10.37
            
            Form
      of Lock up Letter Agreement, dated December 24, 2007 by and between India
      Globalization Capital, Inc. and Dr. Ranga Krishna.
    (10)10.38
            
            Form
      of Letter Agreement, dated December 24, 2007, with Dr. Ranga Krishna.
      (10)10.39
            
            Form
      of Letter Agreement, dated December 24, 2007, with Oliveira Capital, LLC.
      (10)10.40
            
            Form
      of Warrant Clarification Agreement, dated January 4, 2008, by and between
      the Company and Continental Stock Transfer & Trust Company.
      (11)10.41
            
            Form
      of Amendment to Unit Purchase Options, dated January 4, 2008, by and
      between the Company and the holders of Unit Purchase Options.
      (11)10.42
            
            Second
      Amendment to the Share Subscription Cum Purchase Agreement Dated September
      15, 2007, entered into on January 14, 2008 by and among India
      Globalization Capital, Inc., Sricon Infrastructure Private Limited and the
      persons named as Promoters therein. (12)10.43
            
            Letter
      Agreement dated January 8, 2008 by and among India Globalization Capital,
      Inc., Odeon Limited, and Techni Bhararti Limited with respect to the Share
      Purchase Agreement dated September 21, 2007 by and among India
      Globalization Capital, Inc. and  Odeon Limited.
  (12)10.44
            
            Employment
      Agreement between India Globalization Capital, Inc., India Globalization
      Capital Mauritius and Ram Mukunda dated as of March 8, 2008.
      (13)10.45
            
            2008
      Omnibus Incentive Plan. (14)31.1
            
            Certificate pursuant to 17 CFR
      240.13a-14(a).31.2
            
            Certificate pursuant to 17 CFR
      240.13a-14(a).32.1
            
            Certificate pursuant to 18 U.S.C. §
      1350.32.2
            
            Certificate pursuant to 18 U.S.C. §
      1350.





(1)
            Incorporated
      by reference to the Registrant’s Registration Statement on Form S-1 (SEC
      File No. 333-124942), as amended and filed on September 22,
      2006.(2)
            Incorporated
      by reference to the Registrant’s Registration Statement on Form S-1 (SEC
      File No. 333-124942), as amended and filed on February 14,
      2006.





(3)
            Incorporated
      by reference to the Registrant’s Registration Statement on Form S-1 (SEC
      File No. 333-124942), as originally filed on May 13,
  2005.(4)
            Incorporated
      by reference to the Registrant’s Registration Statement on Form S-1 (SEC
      File No. 333-124942), as amended and filed on July 11,
    2005.





(5)
            Incorporated
      by reference to the Registrant’s Registration Statement on Form S-1 (SEC
      File No. 333-124942), as amended and filed on March 2,
    2006.(6)
            Incorporated
      by reference to the Registrant’s Current Report on Form 8-K (SEC File No.
      333-124942), as originally filed on February 12,
  2007.





(7)
            Incorporated
      by reference to the Registrant’s Current Report on Form 8-K (SEC File No.
      333-124942), as originally filed on May 2, 2007.(8)
            Incorporated
      by reference to the Registrant’s Current Report on Form 8-K (SEC File No.
      333-124942), as originally filed on August 23, 2007.(9)
            Incorporated
      by reference to the Registrant’s Current Report on Form 8-K (SEC File No.
      333-124942), as originally filed on September 27, 2007.(10)
            Incorporated
      by reference to the Registrant’s Current Report on Form 8-K (SEC File No.
      333-124942), as originally filed on December 27, 2007.(11)
            Incorporated
      by reference to the Registrant’s Current Report on Form 8-K (SEC File No.
      333-124942), as originally filed on January 7, 2008.(12)
            Incorporated
      by reference to the Registrant’s Current Report on Form 8-K (SEC File No.
      333-124942), as originally filed on January 16, 2008.(13)
            Incorporated
      by reference to the Registrant’s Current Report on Form 8-K (SEC File No.
      333-124942), as originally filed on May 23, 2008.(14)
            Incorporated
      by reference to the Registrant’s Definitive Proxy Statement on Schedule
      14A (SEC File No. 333-124942), as originally filed on February 8,
      2008.(15)
            Incorporated
      by reference to the Registrant’s Current Report on Form 8-K (SEC File No.
      333-124942), as originally filed on June 4, 2008.(16)
            Incorporated
      by reference to the Registrant’s Current Report on Form 8-K (SEC File No.
      333-124942), as originally filed on July 21, 2008.(17)
            Incorporated
      by reference to the Registrant’s Current Report on Form 8-K (SEC File No.
      333-124942), as originally filed on July 30, 2008.(18)
            Incorporated
      by reference to the Registrant’s Registration Statement on Form S-1 (SEC
      File No. 333-124942), as amended and filed on October 29,
      2008.(19)
            Incorporated
      by reference to the Registrant’s Registration Statement on Form S-1 (SEC
      File No. 333-124942), as amended and filed on November 12,
      2008.(20)
            Incorporated
      by reference to the Tender offer statement by Issuer on Form SC TO-1 (SEC
      File No. 333-124942), as originally filed on November 24,
      2008.






39
 Table of Contents






SIGNATURES




In
accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.






INDIA GLOBALIZATION CAPITAL,
      INC.Date:
      July 14, 2009
            By:
            /s/ Ram
      MukundaRam
      MukundaChief
      Executive Officer and President (Principal Executive
    Officer)




Date:
      July 14, 2009
            By:
            /s/ John B.
      SelvarajJohn
      B. SelvarajTreasurer,
      Principal Accounting Officer




In
accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.





Date:
      July 14, 2009
            By:
            /s/ Dr. Ranga
      KrishnaDr.
      Ranga KrishnaDirector




Date:
      July 14, 2009
            By:
            /s/ Sudhakar
      ShenoySudhakar
      ShenoyDirector




Date:
      July 14, 2009
            By:
            /s/ Ram
      MukundaRam
      MukundaDirector




Date:
      July 14, 2009
            By:
            /s/ Richard
      PrinsRichard
      PrinsDirector








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 Table of Contents