**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**WASHINGTON,
      D.C. 20549**




**FORM
      10-Q**





**x**
            **Quarterly
                Report Pursuant to Section 13 or 15(d) of the Securities Exchange
                Act of
                1934****for
                the quarterly period ended June 30,
                2006.**


or





**o**
            **Transition
                Report Pursuant to Section 13 or 15(d) of the Securities Exchange
                Act of
                1934**
              f**or
                the transition period from ___ to
                ____.**




**Commission
      File Number: 000-51854**




**Phoenix
      India Acquisition Corp.**


(Exact
      name of registrant as specified in its charter)




**Delaware**
            
            **20-3195916**(State
                or Other Jurisdiction of
              Incorporation
                or Organization)
            
            (I.R.S.
                Employer
              Identification
                No.)




**590
      Madison Avenue, 6th Floor, New York, New York, 10022**


(Address
      of Principal Executive Offices including Zip Code)





**(212)
      734-4600**


(Registrant’s
      Telephone Number, Including Area Code)




Indicate
      by check mark whether the Registrant (1) has filed all reports required to
      be
      filed by Section 13 or 15(d) of the Exchange Act 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. Yes x No
o ð




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. (Check one):





Large
      Accelerated Filer o Accelerated
      Filer o Non-Accelerated
      Filer x




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





There
      were 8,966,796  shares
      of
      the Registrant’s common stock issued and outstanding as of August 10, 2006.












**Phoenix
      India Acquisition Corp. Index to Form 10-Q**




**Part
                I.**
            **Financial
                Information**Item
                1. Financial Statements (unaudited)Balance SheetsStatements
                of IncomeStatement
                of Stockholders’ EquityStatements
                of Cash FlowsNotes
                to Financial StatementsItem
                2. Management’s Discussion and Analysis of Financial Condition and Results
                of OperationsItem
                3. Quantitative and Qualitative Disclosures about Market RiskItem
                4. Controls and Procedures**Part
                II.**
            **Other
                Information**Item
                1. Legal ProceedingsItem
                1A. Risk FactorsItem
                2. Unregistered Sales of Equity Securities and Use of
                ProceedsItem
                3. Defaults Upon Senior SecuritiesItem
                4. Submission of Matters to a Vote of Security HoldersItem
                5. Other InformationItem
                6. ExhibitsSIGNATURES


2




**PART
      I - FINANCIAL INFORMATION**





**Item
      1 - Financial Statements.**




**PHOENIX
        INDIA ACQUISITION CORP.**


(a
        corporation in the development stage)
  **BALANCE
        SHEETS**


**June
                30, 2006**
            
            **December
                31, 2005****ASSETS**
            
            (Unaudited)**Current
                assets:**Cash
            
            $
            753,762
            
            $
            1,234Proceeds
                escrowed from private placement
            
            
            -
            
            
            -Cash
                held in trust account
            
            
            54,913,371Accrued
                interest receivable
            
            
            279,000
            
            
            -Prepaid
                expenses
            
            
            46,500Other
                assets, deferred offering costs
            
            
            -
            
            
            310,641Total
                assets
            
            $
            55,992,633
            
            $
            311,875**Liabilities
                and Stockholders' Equity**Current
                and total liabilities:Accounts
                payable and accrued expenses
            
            $
            133,917
            
            
            89,875Income
                taxes payable
            
            
            106,400
            
            
            -Notes
                payable, stockholders
            
            
            500,000
            
            
            200,000Deferred
                underwriting fees
            
            
            2,265,500
            
            
            -Total
                current and total liabilities
            
            
            3,005,817
            
            
            289,875Common
                stock subject to redemption, 1,415,2219 shares at redemption value
                of
                $7.65
            
            
            10,826,505
            
            
            -**Stockholders'
                Equity:**Preferred
                stock, $0.0001 par value, authorized 1,000,000 shares; none
                issued
            
            
            -
            
            
            -Common
                stock, $0.0001 par value, authorized 89,000,000 shares, issued and
                outstanding 8,966,796 shares
            
            
            897
            
            
            157Paid-in
                capital in excess of par
            
            
            41,903,917
            
            
            24,843Earnings
                accumulated during the development stage
            
            
            255,497
            
            
            (3,000
            )Total
                stockholders' equity
            
            
            42,160,311
            
            
            22,000Total
                liabilities and stockholders' equity
            
            $
            55,992,633
            
            $
            311,875




*See
        accompanying notes to financial statements*
  3


**PHOENIX
      INDIA ACQUISITION CORP.**


(a
      corporation in the development stage)


**STATEMENTS
        OF INCOME**
 (UNAUDITED)


**For
                the period****from
                July 13, 2005****Three
                months ended**
            
            **Six
                months ended**
            
            **(inception)****June
                30, 2006**
            
            **June
                30, 2006**
            
            **to
                June 30, 2006**Revenues:Interest
                income
            
            $
            641,025
            
            $
            641,025
            
            $
            641,025Expenses:General
                and administrative expenses
            
            
            228,161
            
            
            230,629
            
            
            233,629Total
                expenses
            
            
            228,161
            
            
            230,629
            
            
            233,629Income
                before provision for income taxes
            
            
            412,864
            
            
            410,396
            
            
            407,396Provision
                for income taxes
            
            
            (151,899
            )
            
            (151,899
            )
            
            (151,899
            )Net
                Income
            
            $
            260,965
            
            $
            258,497
            
            $
            255,497Weighted
                average shares outstanding:Basic
            
            
            8,645,453
            
            
            5,124,061
            
            
            3,399,088Diluted
            
            
            11,418,855
            
            
            7,897,463
            
            
            6,172,490Net
                income (loss) per share, basic
            
            $
            0.03
            
            $
            0.05
            
            $
            0.08Net
                income (loss) per share, diluted
            
            $
            0.02
            
            $
            0.03
            
            $
            0.04





*See
        accompanying notes to financial statements*
 4
  **PHOENIX
      INDIA ACQUISITION CORP.**


(a
      corporation in the development stage)


**STATEMENTS
      OF STOCKHOLDERS' EQUITY**


**For
      the period from July 13, 2005 (inception) to June 30, 2006**


(UNAUDITED)








EarningsCommon
                Stock
            
            Paid-in
            
            AcccumulatedPar
                Value
            
            Capital
                in
            
            During
                the
            
            Total$0.0001
            
            Excess
                of
            
            Development
            
            Stockholders'Shares
            
            Amount
            
            Par
            
            Stage
            
            EquityStock
                issuance
            
            
            1,562,500
            
            $
            157
            
            $
            24,843
            
            $
            -
            
            $
            25,000Net
                loss
            
            
            
            
            
            
            
            
            
            
            
            (3,000
            )
            
            (3,000
            )**Balance**,
                at December 31, 2005
            
            
            1,562,500
            
            
            157
            
            
            24,843
            
            
            (3,000
            )
            
            22,000Stock
                issuance on April 5, 2006 @$8.00
            
            
            6,156,250
            
            
            616
            
            
            49,249,384
            
            
            -
            
            
            49,250,000Stock
                issuance on April 5, 2006 @$8.00
            
            
            923,437
            
            
            92
            
            
            7,387,404
            
            
            -
            
            
            7,387,496Stock
                issuance on March 30, 2006 @$8.00
            
            
            93,750
            
            
            9
            
            
            749,991
            
            
            -
            
            
            750,000Proceeds
                from exercise of options on April 5, 2006
            
            
            230,859
            
            
            23
            
            
            3,671
            
            
            -
            
            
            3,694Expenses
                of offerings
            
            
            -
            
            
            -
            
            
            (4,684,871
            )
            
            -
            
            
            (4,684,871
            )Less:
                Proceeds subject to possible redemption of 1,415,229 shares, 19.99%
                of
                public shares are subject to redemption $7.65 per share
            
            
            -
            
            
            -
            
            
            (10,826,505
            )
            
            -
            
            
            (10,826,505
            )**Net
                income**
            
            
            -
            
            
            -
            
            
            -
            
            
            258,497
            
            
            258,497**Balance**,
                at June 30, 2006
            
            
            8,966,796
            
            $
            897
            
            $
            41,903,917
            
            $
            255,497
            
            $
            42,160,311




*See
        accompanying notes to financial statements*
  5


**PHOENIX
      INDIA ACQUISITION CORP.**


(a
      corporation in the development stage)


**STATEMENTS
        OF CASH FLOW**
 (UNAUDITED)





For
                periodfrom
                July 13,Six
                months
            
            2005ended
            
            (inception)
                toJune
                30,
            
            June
                30,2006
            
            2006**Cash
                flows from operating activities**Net
                income
            
            $
            258,497
            
            $
            255,497**Adjustment
                to reconcile net loss to net cash****provided
                by operating activities:**Increase
                in accrued interest receivable
            
            
            (279,000
            )
            
            (279,000
            )Increase
                in prepaid expenses
            
            
            (46,500
            )
            
            (46,500
            )(Decrease)
                increase in accounts payable and accrued expenses
            
            
            92,118
            
            
            92,118Income
                taxes payable
            
            
            106,400
            
            
            106,400Net
                cash used in operating activities
            
            
            131,515
            
            
            128,515**Cash
                flows from investing activities:**Payment
                to trust account
            
            
            (54,913,371
            )
            
            (54,913,371
            )Net
                cash used in investing activities
            
            
            (54,913,371
            )
            
            (54,913,371
            )**Cash
                flows from financing activities:**Gross
                proceeds from public offering
            
            
            56,637,496
            
            
            56,637,496Gross
                proceeds from private offering
            
            
            750,000
            
            
            750,000Proceeds
                from notes payable, stockholders
            
            
            300,000
            
            
            500,000Proceeds
                from sale of common stock
            
            
            -
            
            
            25,000Proceeds
                from exercise of management options
            
            
            3,697
            
            
            3,697Payment
                of offering costs
            
            
            (2,156,809
            )
            
            (2,377,575
            )Net
                cash provided from financing activities
            
            
            55,534,384
            
            
            55,538,618**Net
                increase in cash**
            
            
            752,528
            
            
            753,762**Cash**,
                beginning of period
            
            
            1,234
            
            
            -**Cash**,
                end of period
            
            $
            753,762
            
            $
            753,762Supplemental
                non-cash financing transactionsAccrual
                of costs of public offering
            
            $
            2,419,371
            
            $
            2,419,371Accrued
                deferred offering costs
            
            
            (86,975
            )
            
            86,975




*See
        accompanying notes to financial statements*


6


**NOTES
        TO UNAUDITED FINANCIAL STATEMENTS**
 **June
        30, 2006**
 
 **1.**
              **Basis
                  of Presentation**
 
 The
        financial statements for the three and six months ended June 30, 2006 are
        unaudited. In the opinion of management, all adjustments (consisting only
        of
        normal recurring accruals) have been made that are necessary to present fairly
        the financial position of Phoenix India Acquisition Corp. (the “Company”) as of
        June 30, 2006 and the results of its operations and its cash flows for the
        three
        and six months ended June 30, 2006 and period from July 13, 2005 (inception)
        to
        June 30, 2006 in conformity with generally accepted accounting principles.
        Operating results for the interim period are not necessarily indicative of
        the
        results to be expected for the full year.
 
 **2.**
              **Nature
                  of Operations and Summary of Significant Accounting
                  Policies**
 
 *Nature
        of Operations*
 
 The
        Company was incorporated in Delaware on July 13, 2005, as a blank check company
        whose objective is to acquire, through a merger, capital stock exchange,
        asset
        acquisition or other similar business combination, a currently unidentified
        business with primary operations in India.
 
 Primarily
        all activity from April 5, 2006, the consummation date of the Company’s initial
        public offering (“Offering”) described below, through June 30, 2006 relates to
        the Company’s efforts in identifying an acquisition target in India. The Company
        has selected December 31 as its fiscal year-end. The registration statement
        for
        the Company’s initial public offering ("Offering") was declared effective March
        31, 2006. The Company consummated the Offering on April 5, 2006 including
        the
        923,437 units subject to the underwriters’ over-allotment option and the private
        placement sold to the existing officers and directors through an entity they
        own
        and received net proceeds of approximately $54,600,251 (Note 3). The Company’s
        management has broad discretion with respect to the specific application
        of the
        net proceeds of the Offering, although substantially all of the net proceeds
        of
        the Offering are intended to be generally applied toward consummating a business
        combination with a company operating in India (a “target
        business”).
 
 In
        evaluating a prospective target business, the Company will consider, among
        other
        factors, the financial condition and results of operation; growth potential;
        experience and skill of management; availability of additional personnel;
        capital requirements; competitive position; barriers to entry into other
        industries; stage of development of the products, processes or services;
        degree
        of current or potential market acceptance of the products, processes or
        services; proprietary features and degree of intellectual property or other
        protection of the products, processes or services; regulatory environment
        of the
        industry; and costs associated with effecting the business combination. These
        criteria are not intended to be exhaustive. Any evaluation relating to the
        merits of a particular business combination will be based, to the extent
        relevant, on the above factors, as well as other considerations deemed relevant
        by the Company in effecting a business combination consistent with its business
        objective.
 
 There
        are
        no assurances the Company will be able to successfully effect a business
        combination. An amount of $54,913,371 or 97.0% of the gross proceeds of the
        Offering and the private placement ($7.76 per unit) is being held in an
        interest-bearing trust account at JP Morgan Chase NY Bank maintained by American
        Stock Transfer & Trust Company (“Trust Fund”) and invested in United States
        Treasury Bills with maturity dates of 180 days or less or in money market
        funds
        meeting certain conditions under Rule 2a-7 promulgated with the Investment
        Company Act of 1940, until the earlier of (i) the consummation of the Company’s
        first business combination or (ii) the liquidation of the Company. The placing
        of funds in the Trust Fund may not protect those funds from third party claims
        against the Company. Although the Company will seek to have all vendors,
        prospective target businesses or other entities it engages, execute agreements
        with the Company waiving any right, title, interest or claim of any kind
        in or
        to any monies held in the Trust Fund, there is no guarantee that they will
        execute such agreements. The remaining proceeds, not held in trust, may be
        used
        to pay for business, legal and accounting expenses, expenses which may be
        incurred related to the investigation and selection of a target business,
        and
        the negotiation of an agreement to acquire a target business, and for continuing
        general and administrative expenses.
 
 7
 The
        Company’s first business combination must be with a business or businesses with
        a fair market value of at least 80% of the Company’s net asset value at the time
        of acquisition. The Company, after signing a definitive agreement for the
        acquisition of a target business, will submit such transaction for stockholder
        approval. In the event that stockholders owning 20% or more of the outstanding
        stock excluding, for this purpose, those persons who were stockholders prior
        to
        the Offering, vote against the business combination or request their conversion
        right as described below, the business combination will not be consummated.
        All
        of the Company's stockholders prior to the Offering, including all of the
        officers and directors of the Company (“Initial Stockholders”), have agreed to
        vote their 1,887,109 (including 93,750 shares purchased in the private placement
        and 230,859 shares purchased by exercising their option in full) founding
        shares
        of common stock in accordance with the vote of the majority in interest of
        all
        other stockholders of the Company (“Public Stockholders”) with respect to any
        business combination. After consummation of the Company’s first business
        combination, all of these voting safeguards will no longer be
        applicable.
 
 With
        respect to the first business combination, any Public Stockholder who voted
        against the business combination may demand that the Company redeem his or
        her
        shares. The per share redemption price will equal the amount in the Trust
        Fund
        as of the record date for determination of stockholders entitled to vote
        on the
        business combination divided by the number of shares of common stock held
        by
        Public Stockholders at the consummation of the Offering. Accordingly, Public
        Stockholders holding 19.99% of the aggregate number of shares owned by all
        Public Stockholders may seek redemption of their shares in the event of a
        business combination. Such Public Stockholders are entitled to receive their
        per
        share interest in the Trust Fund computed without regard to the shares held
        by
        Initial Stockholders. Accordingly, a portion of the net proceeds from the
        Offering (19.99% of the amount held in the Trust Fund), or $10,977,182 after
        proceeds from the underwriter over-allotment, has been classified as common
        stock subject to possible conversion and 19.99% of the related interest earned
        on cash held in the Trust Fund has been recorded as deferred revenue until
        the
        business combination is consummated.
 
 The
        Company’s Amended and Restated Certificate of Incorporation provides for
        mandatory liquidation of the Company, without stockholder approval, in the
        event
        that the Company does not consummate a business combination within eighteen
        (18)
        months from the date of the consummation of the Offering, or twenty-four
        (24)
        months from the consummation of the Offering if certain extension criteria
        have
        been satisfied. In the event of liquidation, it is likely that the per share
        value of the residual assets remaining available for distribution (including
        Trust Fund assets) will be less than the initial public offering price per
        share
        in the Offering (assuming no value is attributed to the Warrants contained
        in
        the Units sold in the Offering discussed in Note 3).
 
 *Net
        Income (Loss) Per Common Share*
 
 Net
        income (loss) per share is computed by dividing net income by the
        weighted-average number of shares of common stock outstanding during the
        period.
 
 8
 *Derivative
        Financial Instrument*
 
 As
        described in Note 5, the Company has granted a Purchase Option to a
        representative of its underwriters. Based on Emerging Issues Task Force 00-19,
        Accounting for Derivative Financial Instruments Indexed to, and Potentially
        Settle in, a Company’s Own Stock, the sale of the Purchase Option was reported
        in permanent equity and accordingly, there is no impact on the Company's
        financial position and results of operations, except for the $100 in proceeds
        from sale. Subsequent changes in fair value will not be recognized as long
        as
        the Purchase Option continues to be classified as an equity
        instrument.
 
 The
        Company has determined, based on the Black-Scholes option pricing formula,
        the
        fair value of the Purchase Option at date of issuance, was $6.04 per share
        or
        approximately $2,602,859 in total, using a risk-free interest rate of 5.0%,
        expected life of five years and estimated volatility of 100.0%.
 
 The
        volatility estimate of 100.0% is based on information current available to
        management. Although an expected life of five years was used in the calculation,
        if the Company does not consummate a business combination within the prescribed
        time period and the Company liquidates, the Company believes the option will
        become worthless.
 
 *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 at the date of the financial statements and the reported amounts
        of
        expenses during the reporting period. Actual results could differ from those
        estimates.
 
 *Income
        Taxes*
 
 Deferred
        income taxes are provided for the differences between the basis 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.
 
 The
        effective tax rate differs from the statutory rate of 34% due to primarily
        all
        interest income being generated from tax-exempt securities.
 
 *Recent
        Accounting Pronouncements*
 
 The
        Company does not believe that any recently issued, but not yet effective,
        accounting standards, if currently adopted, would have a material effect
        on the
        accompanying financial statements.
 
 **3.**
              **Per
                  Share Information**
 
 In
        accordance with SFAS No. 128, “Earnings Per Share”, basic earnings per common
        share (“Basic EPS”) is computed by dividing the net income by the
        weighted-average number of shares outstanding. Diluted earnings per common
        share
        (“Diluted EPS”) is computed by dividing the net income by the weighted-average
        number of common shares and dilutive common share equivalents and warrants
        then
        outstanding. SFAS No. 128 requires the presentation of both Basic EPS and
        Diluted EPS on the face of the Company’s Condensed Statements of Income. Common
        share equivalents totaling 860,074 were excluded from the computation of
        the
        three, six months ended June 30, 2006 and since inception on June 13, 2005
        to
        June 30, 2006, as their impact would have been anti-dilutive.
 
 9
 
 The
        following table sets forth the computation of basic and diluted per share
        information:
 **For
                    the period****from
                    July 13, 2005****Three
                    months ended**
                
                **Six
                    months ended**
                
                **(inception)****June
                    30, 2006**
                
                **June
                    30, 2006**
                
                **to
                    June 30, 2006****Numerator:**Net
                    Income
                
                $
                255,497
                
                $
                250,029
                
                $
                247,029**Denominator:**Weighted-average
                    common shares outstanding
                
                
                8,645,453
                
                
                5,124,061
                
                
                3,399,088Dilutive
                    effect of warrants
                
                
                2,773,402
                
                
                2,773,402
                
                
                2,773,402Weighted-average
                    common shares outstanding, assuming dilution
                
                
                11,418,855
                
                
                7,897,463
                
                
                6,172,490**Net
                    Income Per Share:**Basic
                
                $
                0.03
                
                $
                0.05
                
                $
                0.07Diluted
                
                $
                0.02
                
                $
                0.03
                
                $
                0.04
  **4.**
              **Initial
                  Public Offering**
 
 On
        April
        5, 2006, the Company sold 7,079,687 units -- including 923,437 units subject
        to
        the underwriters’ over-allotment option -- ("Units") in the Offering. On March
        31, 2006, an additional 93,750 Units were sold in a private placement to
        the
        existing officers and directors, through an entity they own. Each Unit consists
        of one share of the Company’s common stock, $.0001 par value and one Redeemable
        Common Stock Purchase Warrant (“Warrant”). Each Warrant entitles the holder to
        purchase from the Company one share of common stock at an exercise price
        of
        $5.00 commencing the later of the completion of a business combination with
        a
        target business or one (1) year from the effective date of the Offering and
        expiring five (5) years from the effective date of the Offering. The Warrants
        will be redeemable by the Company at a price of $.01 per Warrant, upon thirty
        (30) days notice after the Warrants become exercisable, only in the event
        that
        the last sales price of the common stock is at least $11.50 per share for
        any
        twenty (20) trading days within a thirty (30) trading-day period ending on
        the
        third day prior to date on which notice of redemption is given. The warrants
        began trading separately from the Company’s common stock on May 19, 2006. In
        connection with the Offering, the Company paid the underwriter a discount
        of 7%
        of the gross proceeds of the Offering.
 
 **5.**
              **Notes
                  Payable, Stockholders**
 
 The
        Company issued unsecured promissory notes to all of the Company’s Initial
        Stockholders, amounting to $500,000, who are also officers. The notes are
        interest bearing and will be paid from the interest income from the Trust
        Fund
        immediately upon fully funding the $1,250,000 working capital
        budget.
 
 **6.**
              **Unit
                  Option**
 
 In
        connection with the Offering, the Company issued to the representative of
        the
        underwriters for $100, an option to purchase up to a total of 430,037 units,
        exercisable at $8.80 per unit (“Purchase Option”). In lieu of payment of the
        exercise price in cash, the holder of the Purchase Option has the right (but
        not
        the obligation) to convert any exercisable portion of the Purchase Option
        into
        units using a cashless exercise based on the difference between current market
        value of the units and its exercise price. The Warrants issued in conjunction
        with these units are identical to those sold in the Offering, except that
        they
        have an exercise price of $5.50 (110% of the exercise price of the Warrants
        included in the Units sold in the Offering). This option commences on the
        later
        of the consummation of a business combination and one (1) year from the date
        of
        the prospectus and expiring five (5) years from the date of the prospectus.
        Additionally, the option may not be sold, transferred, assigned, pledged
        or
        hypothecated for a one-year period (including the foregoing 180-day period)
        following April 5, 2006. However, the option may be transferred to any
        underwriter and selected dealer participating in the Offering and their bona
        fide officers or partners. The purchase option grants to holders demand and
        “piggy back” rights for periods of five (5) and seven (7) years, respectively,
        from April 5, 2006 with respect to the registration under the Securities
        Act of
        the securities directly and indirectly issuable upon exercise of the option.
        The
        Company will bear all fees and expenses attendant to registering the securities,
        other than underwriting commissions, which will be paid for by the holders
        themselves. The exercise price and number of units issuable upon exercise
        of the
        option may be adjusted in certain circumstances, including in the event of
        a
        stock dividend, or our recapitalization, reorganization, merger or
        consolidation. However, the option will not be adjusted for issuances of
        common
        stock at a price below its exercise price.
 
 10
 **7.**
              **Related
                  Party Transaction**
 
 The
        Company presently occupies office space in a location, provided by one affiliate
        of the Initial Stockholders. Such affiliate has agreed that, until the Company
        consummates a business combination, they will make such office space, as
        well as
        certain office and secretarial services, available to the Company, as may
        be
        required by the Company from time to time. The Company has agreed to pay
        such
        affiliates an aggregate of $5,000 per month for such services commencing
        on the
        effective date of the Offering. Upon completion of a business combination
        or
        liquidation, the Company will no longer be required to pay these monthly
        fees.
 
 The
        Initial Stockholders, who are holders of 1,887,109 (including 93,750 shares
        purchased in the private placement and 230,859 shares purchased by exercising
        their option in full) issued and outstanding shares of common stock, are
        entitled to registration rights pursuant to an agreement signed on the effective
        date of the Offering. The holders of the majority of these shares are entitled
        to request the Company, on up to two (2) occasions, to register these shares.
        The holders of the majority of these shares can elect to exercise these
        registration rights at any time after the date on which these shares of common
        stock are released from escrow. In addition, these stockholders have certain
        "piggy-back" registration rights on registration statements filed subsequent
        to
        the date on which these shares of common stock are released from escrow.
        The
        Company will bear the expenses incurred in connection with the filing of
        any
        such registration statements.
 
 **8.**
              **Preferred
                  Stock**
 
 The
        Company is authorized to issue 1,000,000 shares of preferred stock with such
        designations, voting and other rights and preferences, as may be determined
        from
        time to time by the Board of Directors.
 
 **9.**
              **Common
                  Stock**
 
 On
        January 11, 2006, the Company’s Board of Directors authorized a one-for-two
        reverse split of its common shares. All references in the accompanying financial
        statements to the number of shares of stock have been retroactively restated
        to
        reflect these transactions.
 
 11
 
 **Item
        2. Management's Discussion and Analysis of Financial Condition and Results
        of
        Operations.**
 
 **Forward
        Looking Statements**
 
 This
        Quarterly Report on Form 10-Q includes forward-looking statements within
        the
        meaning of Section 27A of the Securities Act of 1933, as amended, and Section
        21E of the Securities Exchange Act of 1934, as amended. We have based these
        forward-looking statements on our current expectations and projections about
        future events. These forward-looking statements are subject to known and
        unknown
        risks, uncertainties and assumptions about us that may cause our actual results,
        levels of activity, performance or achievements to be materially different
        from
        any future results, levels of activity, performance or achievements expressed
        or
        implied by such forward-looking statements. In some cases, you can identify
        forward-looking statements by terminology such as “may”, “should”, “could”,
“would”, “expect”, “plan”, “anticipate”, “believe”, “estimate”, “continue”, or
        the negative of such terms or other similar expressions. Factors that might
        cause or contribute to such a discrepancy include, but are not limited to,
        those
        described in our other Securities and Exchange Commission filings. The following
        discussion should be read in conjunction with our Financial Statements and
        related Notes thereto included elsewhere in this report.
 
 **Critical
        Accounting Policies**
 
 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 at the date of the financial statements and the reported amounts
        of
        expenses during the reporting period. Actual results could differ from those
        estimates.
 
 Management
        does not believe that any recently issued, but not yet effective, accounting
        standards if currently adopted would have a material effect on the accompanying
        financial statements.
 
 **Overview**
 
 We
        were
        organized as a Delaware corporation on July 13, 2005, to serve as a vehicle
        to
        acquire, through a merger, capital stock exchange, asset acquisition or other
        similar business combination, an operating business in India. Our initial
        business combination must be with a target business or businesses whose fair
        market value is at least equal to 80% of net assets at the time of such
        acquisition. We intend to utilize cash derived from the proceeds of the
        Offering, our capital stock, debt or a combination of cash, capital stock
        and
        debt, in effecting a business combination.
 
 **Results
        of Operations for the Thee and Six Months Ending June 30,
        2006**
 
 We
        had a
        net profit of $255,497 for the three month period ended June 30, 2006, primarily
        as a result of interest income received on funds held in trust (less interest
        income deferred as a result of the shares subject to possible future redemption)
        offset in part by consulting and professional fees and other operating expenses
        discussed below. For the six months ended June 30, 2006, we had a net profit
        of
        $250,009, primarily as a result of interest income received on funds held
        in
        trust (less interest income deferred as a result of the shares subject to
        possible future redemption) offset in part by consulting and professional
        fees
        and other operating expenses discussed below.
 
 12
 
 **Liquidity
        and Capital Resources**
 
 On
        April
        5, 2006, we consummated our initial public offering of 7,079,687 units
        (including 923,437 units subject to the underwriters’ over-allotment option) and
        a private placement of 93,750 units sold to the existing officers and directors
        through an entity they own. Each unit consists of one share of common stock
        and
        one redeemable common stock purchase warrant. Each warrant entitles the holder
        to purchase from us one share of our common stock at an exercise price of
        $5.00.
 
 Our
        net
        proceeds from the sale of our units, including amounts from exercise of the
        underwriters’ over-allotment option and the private placement, after deducting
        certain offering expenses of approximately $722,713, (including the proceeds
        from the underwriters’ over-allotment), and underwriting discounts of
        approximately $1,699,124, were approximately $55,350,251. Of this amount,
        $54,913,370 is being held in trust and the remaining $436,880 is being held
        outside of the trust. The remaining proceeds are available to be used by
        us to
        provide for business, legal and accounting due diligence on prospective
        acquisitions and continuing general and administrative expenses. We will
        use
        substantially all of the net proceeds of the Offering to acquire a target
        business, including identifying and evaluating prospective acquisition
        candidates, selecting the target business, and structuring, negotiating and
        consummating the business combination. To the extent that our capital stock
        is
        used in whole or in part as consideration to effect a business combination,
        the
        proceeds held in the trust fund plus an incremental $1,250,000 to be funded
        from
        interest income earned on the trust fund as well as any other net proceeds
        not
        expended will be used to finance the operations of the target business. We
        believe we will have sufficient available funds outside of the trust fund
        to
        operate through April 5, 2008, assuming that a business combination is not
        consummated during that time. From April 5, 2006 through April 5, 2008, we
        anticipate approximately $50,000 of expenses for legal, accounting and other
        expenses attendant to the due diligence investigations, structuring and
        negotiation of a business combination, an aggregate of $120,000 for the
        administrative fees payable to Phoenix Capital Partners LLC (a total of $5,000
        per month for two years), $50,000 for expenses for the due diligence and
        investigation of target businesses, $70,000 of expenses for legal and accounting
        fees relating to our SEC reporting obligations and $190,000 for general working
        capital that will be used for miscellaneous expenses and reserves. We do
        not
        believe we will need to raise additional funds in order to meet the expenditures
        required for operating our business. However, we may need to raise additional
        funds through a private or public offering of debt or equity securities if
        such
        funds are required to consummate a business combination that is presented
        to us.
        We would only consummate such a financing simultaneously with the consummation
        of a business combination.
 
 Commencing
        on April 5, 2005 and ending upon the acquisition of a target business, we
        incur
        a fee of $5,000 per month for office space and certain other additional general
        and administrative services from Phoenix Capital Partners LLC, an affiliate
        of
        which Ramesh Akella (our President, Chief Strategy Officer and Director)
        is the
        managing member.
 
 We
        have
        granted a purchase option to the representative of the underwriter at the
        closing of the Offering on April 5, 2006 to acquire 430,937 units at $8.80
        per
        unit for $100. The fair value of the purchase option was estimated at $6.04
        per
        share or approximately $2,602,859 in the aggregate. The purchase option was
        accounted for as an equity instrument in permanent equity. Accordingly, there
        was no impact on our financial position or results of operations, except
        for
        recording the $100 proceeds from the sale.
 
 **Off-Balance
        Sheet Arrangements**
 
 We
        do not
        have any off-balance sheet arrangements.
 
 13
 **Item
        3. Quantitative and Qualitative Disclosures About Market
        Risk.**
 
 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. We are not presently engaged in and, if a suitable business target
        is
        not identified by us prior to the prescribed liquidation date of the trust
        fund,
        we may not engage in, any substantive commercial business. Accordingly, we
        are
        not and, until such time as we consummate a business combination, we will
        not
        be, exposed to risks associated with foreign exchange rates, commodity prices,
        equity prices or other market-driven rates or prices. The net proceeds of
        our
        initial public offering held in the trust fund have been invested only in
        money
        market funds meeting certain conditions under Rule 2a-7 promulgated under
        the
        Investment Company Act of 1940 or United States treasury bills. Given our
        limited risk in our exposure to these money market funds and treasury bills,
        we
        do not view the interest rate risk to be significant.
 
 **Item
        4. Controls and Procedures.**
 
 Our
        management carried out an evaluation, with the participation of our president
        and chief strategy officer (our principal executive officer, principal financial
        and accounting officer) of the effectiveness of our disclosure controls and
        procedures as of June 30, 2006. Based upon that evaluation, our president
        and
        chief strategy officer concluded that our disclosure controls and procedures
        are
        effective as of the end of the period covered by this report to ensure that
        information required to be disclosed by us in reports that we file or submit
        under the Securities Exchange Act of 1934 is accumulated and communicated
        to
        management (including such officers) as appropriate to allow timely decisions
        regarding required disclosures and recorded, processed, summarized, and reported
        within the time periods specified in the rules and forms of the Securities
        and
        Exchange Commission. There has been no significant change in our internal
        control over financial reporting in connection with the evaluation required
        by
        Rule 13a-15(d) under the Exchange Act that occurred during the quarter ended
        June 30, 2006, that has materially affected, or is reasonably likely to
        materially affect, our internal control over financial reporting.
 
 **PART
        II - OTHER INFORMATION**
 
 **Item
        1. Legal Proceedings.**
 
 None
 
 **Item
        1A. Risk Factors.**
 
 **Risks
        associated with our business**
 
 ***We
        are a development stage company with no operating history and, accordingly,
        our
        stockholders will not have any basis on which to evaluate our ability to
        achieve
        our business objective.***
 
 We
        are a
        recently incorporated development stage company with no operating results
        to
        date. Since we do not have an operating history, our stockholders will have
        no
        basis upon which to evaluate our ability to achieve our business objective,
        which is to acquire one or more operating businesses. We have not conducted
        any
        discussions and we have no plans, arrangements or understandings with any
        prospective acquisition candidates. We will not generate any revenues until,
        at
        the earliest, after the consummation of a business combination.
 
 14
 ***If
        we are forced to liquidate before a business combination, our public
        stockholders will receive less than $8.00 per share upon distribution of
        the
        trust account and our warrants will expire worthless.***
 
 If
        we are
        unable to complete a business combination and are forced to liquidate our
        assets
        (which will include the full amount in the trust account, including $2,265,500)
        held for the benefit of Rodman & Renshaw, LLC and any interest earned
        thereon (net of taxes payable)), the per-share liquidation price will be
        less
        than approximately $7.77 per share, plus interest, if any (net of taxes payable
        and up to $1,250,000 of interest earned on the trust account that may be
        released to us to fund our working capital and repay management loans) because
        of the expenses of our initial public offering, our general and administrative
        expenses and the anticipated costs of seeking a business combination.
        Furthermore, there will be no distribution with respect to our outstanding
        warrants and, accordingly, the warrants will expire worthless if we liquidate
        before the completion of a business combination.
 
 ***Our
        stockholders will not be entitled to protections normally afforded to investors
        of blank check companies.***
 
 Since
        the
        net proceeds of the initial public offering are intended to be used to complete
        a business combination with one or more target businesses that have not been
        identified, we may be deemed to be a “blank check” company under the United
        States securities laws. However, since we had net tangible assets in excess
        of
        $5,000,000 upon the successful consummation of the initial public offering
        and
        filed a Current Report on Form 8-K with the Securities and Exchange Commission
        upon consummation of the initial public offering, including an audited balance
        sheet demonstrating this fact, we are exempt from rules promulgated by the
        Securities and Exchange Commission to protect investors of blank check
        companies, such as Rule 419. Accordingly, investors were not be afforded
        the
        benefits or protections of those rules. Because we believe we are not subject
        to
        Rule 419, our units will be immediately tradable, and we have a longer period
        of
        time to complete a business combination in certain circumstances.
 
 ***If
        third parties bring claims against us, the proceeds held in trust could be
        reduced and the per-share liquidation price received by stockholders may
        be less
        than $7.77 per share and the per share redemption price for redeeming
        stockholders could be less than $7.65.***
 
 Our
        placing of funds in trust may not protect those funds from third party claims
        against us. Although we will seek to have vendors, prospective target businesses
        or other entities we hire or do business with execute agreements with us
        waiving
        any right, title, interest or claim of any kind in or to any monies held
        in the
        trust account for the benefit of our public stockholders, there is no guarantee
        that they will execute such agreements or, even if they execute such agreements,
        that they would be prevented from bringing claims against the trust account.
        If
        any third party refused to execute an agreement waiving such claims to the
        monies held in the trust account, we would perform an analysis of the
        alternatives available to us and evaluate if such engagement would be in
        the
        best interest of our stockholders. Examples of possible instances where we
        may
        engage a third party that has refused to execute a waiver include the engagement
        of a third party consultant whose particular expertise or skills are believed
        by
        management to be significantly superior to those of other consultants that
        would
        agree to execute a waiver or in cases where management is unable to find
        a
        provider of required services willing to provide the waiver. In addition,
        there
        is no guarantee that such entities will agree to waive any claims they may
        have
        in the future as a result of, or arising out of, any negotiations, contracts
        or
        agreements with us and will not seek recourse against the trust account for
        any
        reason. Accordingly, the proceeds held in trust could be subject to claims
        which
        could take priority over the claims of our public stockholders and the per-share
        liquidation price could be less than approximately $7.77, plus interest (net
        of
        taxes payable and up to $1,250,000 of interest earned on the trust account
        that
        may be released to us to fund our working capital and repay management loans),
        due to claims of such creditors. If we are unable to complete a business
        combination and are forced to liquidate, our officers and directors, severally,
        in accordance with their respective beneficial ownership interests in us,
        will
        be personally liable to ensure that the proceeds in the trust account are
        not
        reduced by the claims of various vendors (which does not include, for example,
        third party creditors) for services rendered or contracted for or products
        sold
        to us, but only to the extent necessary to ensure that such loss, liability,
        claim, damage or expense does not reduce the amount in the trust account.
        However, we cannot assure our stockholders that they will be able to satisfy
        those obligations. Further, they will not be personally liable to pay debts
        and
        obligations to prospective target businesses, if a business combination is
        not
        consummated with such prospective target businesses, or for claims from any
        entity other than vendors. Accordingly, the proceeds held in trust could
        be
        subject to claims which could take priority over the claims of our public
        stockholders and the per-share liquidation price could be less than
        approximately $7.77, plus interest (net of taxes payable and up to $1,250,000
        of
        interest earned on the trust account that may be released to us to fund our
        working capital and repay management loans), due to claims of such creditors.
        In
        addition, such third party claims could result in the per share redemption
        price
        received by stockholders who vote against a business combination and elect
        to
        redeem their shares for cash being less than approximately $7.65 per-share,
        plus
        interest (net of taxes payable and interest previously released to
        us).
 
 15
 ***Since
        we have not currently selected any target business with which to complete
        a
        business combination, investors are unable to currently ascertain the merits
        or
        risks of the target business’ operations.***
 
 Since
        we
        have not yet identified a prospective target business, investors have no
        current
        basis to evaluate the possible merits or risks of the target business’
operations. To the extent we complete a business combination with a financially
        unstable company or an entity in its development stage, we may be affected
        by
        numerous risks inherent in the business operations of those entities. Although
        our management will endeavor to evaluate the risks inherent in a particular
        target business, we cannot assure our stockholders that we will properly
        ascertain or assess all of the significant risk factors.
 
 ***We
        will be dependent upon interest earned on the trust account to fund our search
        for a target company and consummation of a business
        combination.***
 
 As
        of the
        date of this report, we have approximately $753,000 available to us outside
        the
        trust account to fund our working capital requirements. We will be dependent
        upon sufficient interest being earned on the proceeds held in the trust account
        to provide us with the additional working capital we will need to search
        for a
        target company and consummate a business combination. While we are entitled
        to
        the interest earned on the trust account (net of taxes payable), up to a
        maximum
        of $1,250,000 (of which we have received approximately $361,000 as of June
        30,
        2006), for such purpose and to repay working capital loans from management,
        if
        interest rates were to decline substantially, we may not have sufficient
        funds
        available to complete a business combination. In such event, we would need
        to
        borrow funds from our insiders or others or be forced to liquidate.
 
 ***Because
        there are numerous companies with business plans similar to ours seeking
        to
        effectuate business combinations, it may be more difficult for us to do
        so.***
 
 Since
        August 2003, based upon publicly available information, approximately 40
        similarly structured blank check companies have completed initial public
        offerings, and numerous others have filed registration statements for initial
        public offerings. Of these companies, only four companies have consummated
        a
        business combination, while seven other companies have announced they have
        entered into a definitive agreement for a business combination, but have
        not
        consummated such business combination. While, like us, some of those companies
        have specific industries in which they must complete a business combination,
        a
        number of them may consummate a business combination in any industry they
        choose. Moreover, we know of at least two companies which have filed a
        registration statement and seek to consummate a business combination in India.
        We may, therefore, be subject to competition from these and other companies
        seeking to consummate a business plan similar to ours, which, as a result,
        would
        increase demand for privately-held companies to combine with companies
        structured similarly to ours. Further, the fact that only a few of such
        companies have completed a business combination or entered into a definitive
        agreement for a business combination, may be an indication that there are only a
        limited number of attractive target businesses available to such entities,
        or
        that many privately held or publicly held, target businesses may not be inclined
        to enter into business combinations with publicly held blank check companies
        like us. We cannot assure our stockholders that we will be able to successfully
        compete for an attractive business combination. Additionally, because of
        this
        competition, we cannot assure our stockholders that we will be able to
        effectuate a business combination within the required time periods. If we
        are
        unable to find a suitable target business within such time periods, we will
        be
        forced to liquidate.
 
 16
 ***We
        may issue shares of our capital stock or convertible debt securities to complete
        a business combination, 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 89,000,000
        shares
        of common stock, par value $.0001 per share, and 1,000,000 shares of blank
        check
        preferred stock, par value $.0001 per share. As of April 5, 2006, there were
        72,513,126 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 all of the 1,000,000 shares of
        blank
        check preferred stock available for issuance. We may issue a substantial
        number
        of additional shares of our common stock or blank check preferred stock,
        or a
        combination of common and blank check preferred stock, to complete a business
        combination. The issuance of additional shares of our common stock or any
        number
        of shares of our blank check preferred stock:
 
 •
              May
                  significantly reduce the equity interest of current
                  stockholders;
 
 •
              Will
                  likely cause a change in control if a substantial number of our
                  shares of
                  common stock are issued, which may affect, among other things,
                  our ability
                  to use our net operating loss carry forwards, if any, and most
                  likely also
                  result in the resignation or removal of our present officers and
                  directors;
 
 •
              May
                  reduce or limit the voting power or other rights of holders of
                  our common
                  stock if we issue preferred stock with dividend, liquidation, compensation
                  or other rights superior to the common stock;
                  and
 
 •
              May
                  reduce the prevailing market prices for our common stock warrants
                  and
                  units.
 
 Similarly,
        if we issue debt securities, it could result in:
 
 •
              Default
                  and foreclosure on our assets if our operating cash flow after
                  a business
                  combination were insufficient to pay our debt
                  obligations;
 
 •
              Acceleration
                  of our obligations to repay the indebtedness even if we have made
                  all
                  principal and interest payments when due if the debt security contained
                  covenants that required the maintenance of certain financial ratios
                  or
                  reserves and any such covenant were breached without a waiver or
                  renegotiation of that covenant;
 
 17
 •
              Our
                  immediate payment of all principal and accrued interest, if any,
                  if the
                  debt security was payable on demand;
                  and
 
 •
              Our
                  inability to obtain additional financing, if necessary, if the
                  debt
                  security contained covenants restricting our ability to obtain
                  additional
                  financing while such security was
                  outstanding.
 
 ***Our
        ability to successfully effect a business combination and to be successful
        afterward will be totally dependent upon the efforts of our management, some
        of
        whom may join us following a business combination and whom we would have
        only a
        limited ability to evaluate. It is also possible that one or more of our
        current
        officers and directors will resign upon the consummation of a business
        combination.***
 
 Our
        ability to successfully effect a business combination will be totally dependent
        upon the efforts of the four members of our management team. The future role
        of
        our management following a business combination, however, cannot presently
        be
        fully ascertained. Although we expect our officers and directors to remain
        associated with us following a business combination, we may employ other
        personnel following the business combination. Moreover, our current management
        will only be able to remain with the combined company after the consummation
        of
        a business combination if they are able to negotiate and agree to mutually
        acceptable employment terms as part of any such combination, which terms
        would
        be disclosed to stockholders in any proxy statement relating to such
        transaction. If we were to acquire a target business in an all-cash transaction,
        it would be more likely that current members of management would remain with
        the
        combined company if they chose to do so. If a business combination were
        structured as a merger whereby the stockholders of the target business were
        to
        control the combined company following a business combination, it may be
        less
        likely that our current management would remain with the combined company,
        unless it had been negotiated as part of the transaction via the acquisition
        agreement, an employment agreement or other arrangement. In making the
        determination as to whether current management should remain with us following
        the business combination, management will analyze the experience and skill
        set
        of the target business’ management and negotiate as part of the business
        combination that certain members of current management remain, if it is believed
        to be in the best interests of the combined company post-business combination.
        The terms of any employment or consulting arrangements of our current management
        with the combined company post-business combination will be determined at
        the
        time management negotiates the terms of the business combination with a target
        business. Since our current management will be negotiating the terms of the
        business combination as well as the terms of their employment or consulting
        arrangements, our current management may have a conflict of interest in
        negotiating terms favorable to the company in the acquisition agreement and
        at
        the same time negotiating terms in their employment or consulting arrangements
        that are favorable to them. Although management intends to fully exercise
        its
        fiduciary duty to negotiate terms in the acquisition agreement that will
        be in
        the best interests of the combined-company and its public stockholders, members
        of management may be negotiating terms in their employment or consulting
        agreements that are favorable to them. While we intend to closely scrutinize
        any
        additional individuals we engage after a business combination, we cannot
        assure
        our stockholders that our assessment of these individuals will prove to be
        correct. These individuals may be unfamiliar with the requirements of operating
        a public company, as well as United States securities laws, which could cause
        us
        to have to expend time and resources helping them become familiar with such
        laws. This could be expensive and time-consuming and could lead to various
        regulatory issues which may result in our operations becoming less
        efficient.
 
 18
 ***Our
        officers and directors will allocate their time to other businesses, thereby
        causing conflicts of interest in their determination as to how much time
        to
        devote to our affairs. This could have a negative impact on our ability to
        consummate a business combination.***
 
 Our
        officers and directors are not required to commit their full time to our
        affairs, which may result in a conflict of interest in allocating their time
        between our operations and other businesses. We do not intend to have any
        full-time employees prior to the consummation of a business combination.
        Our
        officers are engaged in several other business endeavors and are not obligated
        to contribute any specific number of hours per week to our affairs. While
        it is
        our officers’ intention to devote substantial business time to identifying
        potential target businesses and consummating a business combination, their
        other
        business affairs could require them to devote more substantial amounts of
        time
        to such affairs, thereby limiting their ability to devote time to our affairs.
        This could have a negative impact on our ability to consummate a business
        combination.
 
 ***Our
        officers and directors may in the future become affiliated with entities
        engaged
        in business activities similar to those intended to be conducted by us and,
        accordingly, may have conflicts of interest in determining to which entity
        a
        particular business opportunity should be presented.***
 
 Although
        none of our officers, directors or affiliates have previously been associated
        with any “blank check” companies, our officers and directors may in the future
        become affiliated with entities, including other “blank check” companies,
        engaged in business activities similar to those intended to be conducted
        by us.
        Additionally, our officers and directors may become aware of business
        opportunities which may be appropriate for presentation to us as well as
        the
        other entities with which they are or may be affiliated. Further, certain
        of our
        officers and directors are currently involved in merchant banking/private
        equity
        businesses. Due to these existing affiliations, they may have fiduciary
        obligations to present potential business opportunities to those entities
        prior
        to presenting them to us which could cause additional conflicts of interest.
        Accordingly, they may have conflicts of interest in determining to which
        entity
        a particular business opportunity should be presented.
 
 ***All
        of our officers and directors own shares of our common stock which will not
        participate in liquidation distributions and, therefore, they may have a
        conflict of interest in determining whether or not a particular target business
        is appropriate for a business combination.***
 
 All
        of
        our officers and directors and their respective affiliates own shares of
        our
        common stock that were issued in connection with our formation (including
        shares
        underlying their anti-dilution options) as to which they have waived their
        right
        to receive distributions upon our liquidation or failure to complete a business
        combination. Additionally, our executive officers and directors have purchased,
        through an entity they own, an aggregate of 93,750 units in a private placement
        that occurred immediately prior to our initial public offering and have waived
        their liquidation rights with respect to the shares included in such units.
        The
        shares and warrants owned by our officers and directors and their affiliates
        will be worthless if we do not consummate a business combination. The personal
        and financial interests of our officers and directors may influence their
        motivation in identifying and selecting a target business and completing
        a
        business combination in a timely manner. Consequently, our directors’ and
        officers’ discretion in identifying and selecting a suitable target business may
        result in a conflict of interest when determining whether the terms, conditions
        and timing of a particular business combination are appropriate and in our
        public stockholders’ best interest.
 
 19
 ***Our
        officers and directors own shares that are subject to early release from
        escrow
        if a business combination involves a change of control, and, therefore, they
        may
        have a conflict of interest in determining how to structure a business
        combination.***
 
 The
        shares of common stock owned by our existing stockholders prior to our initial
        public offering have been placed into an escrow account and will only be
        released one year after we complete a business combination unless the business
        combination results in a change of control. In such event, the shares will
        be
        released from escrow immediately upon the completion of the transaction.
        Consequently, our officers and directors may have a conflict of interest
        in
        determining how to structure, in terms of cash and/or equity, a business
        combination. A change of control for this purpose means a consolidation or
        merger where our stockholders immediately prior to such transaction hold
        less
        than 50% of the voting stock of the surviving entity.
 
 ***Our
        officers and directors will not receive reimbursement for any out-of-pocket
        expenses incurred by them to the extent that such expenses exceed the available
        funds outside the trust account, unless the business combination is consummated
        and, therefore, they may have a conflict of interest in determining whether
        or
        not a particular target business is appropriate for a business combination
        and
        in the public stockholders’ best interest.***
 
 Our
        officers and directors will not receive reimbursement for any out-of-pocket
        expenses incurred by them to the extent that such expenses exceed the available
        funds held outside the trust account and the portion of the interest earned
        on
        the trust account released to us (which, because interest rates are unknown,
        may
        be insufficient to fund all of our working capital requirements) unless the
        business combination is consummated. The personal and financial interests
        of our
        officers and directors could influence their motivation in selecting a target
        business and, thus, there may be a conflict of interest when determining
        whether
        or not a particular business combination is in the stockholders’ best
        interest.
 
 ***We
        may be unable to obtain additional financing, if required, to complete a
        business combination or to fund the operations and growth of the target
        business, which could compel us to restructure the transaction or abandon
        a
        particular business combination.***
 
 Although
        we believe that the net proceeds of our initial public offering will be
        sufficient to allow us to consummate a business combination, as we have not
        yet
        identified any prospective target business, we cannot ascertain the capital
        requirements for any particular transaction. If we have insufficient funds,
        either because of the size of the business combination or the depletion of
        the
        available net proceeds (including interest earned on the trust account released
        to us) in search of a target business, or because we become obligated to
        redeem
        for cash a significant number of shares from dissenting stockholders, we
        will be
        required to seek additional financing. We cannot assure our stockholders
        that
        such financing would be available on acceptable terms, if at all. To the
        extent
        that additional financing proves to be unavailable when needed to consummate
        a
        particular business combination, we would be compelled to restructure the
        transaction or abandon that particular business combination and seek an
        alternative target business candidate. In addition, it is possible that we
        could
        use a portion of the funds not held in the trust account to make a deposit,
        down
        payment or fund a “no-shop, standstill” provision with respect to a particular
        proposed business combination, although we do not have any current intention
        to
        do so. In the event that we were ultimately required to forfeit such funds
        (whether as a result of our breach of the agreement relating to such payment
        or
        otherwise), we may not have a sufficient amount of working capital available
        outside of the trust account to conduct due diligence and pay other expenses
        related to finding a suitable business combination without securing additional
        financing. If we were unable to secure additional financing, we would most
        likely fail to consummate a business combination in the allotted time and
        would
        be forced to liquidate. In addition, if we consummate a business combination,
        we
        may require additional financing to fund the operations or growth of the
        target
        business. The failure to secure additional financing could limit the development
        or growth of the target business. None of our officers, directors or
        stockholders is required to provide any financing to us in connection with
        or
        after a business combination.
  ***If
          we liquidate, the procedures we must follow under Delaware law are
          time-consuming and may result in residual liability for our
          stockholders***
 
 If
          we do
          not consummate a business combination by the later of August 5, 2007, or
          April
          5, 2008 in the event that a letter of intent, an agreement in principle
          or a
          definitive agreement to complete a business combination was executed but
          not
          consummated by August 5, 2007, then, pursuant to Article SIXTH of our
          certificate of incorporation, and in accordance with Section 281(b) of
          the
          Delaware General Corporation Law (the “DGCL”), we will adopt a plan of
          dissolution, and as soon as reasonably possible after dissolution, make
          liquidating distributions to our stockholders.
 
 Under
          the
          DGCL, stockholders may be held liable for claims by third parties against
          a
          corporation to the extent of distributions received by them in a dissolution.
          To
          mitigate against this possibility, we ask our vendors and potential target
          businesses to waive any right, title, interest or claim of any kind in
          or to any
          monies held in the trust account. As a result of this, we believe that
          the
          claims that could be made against us are limited and the likelihood that
          any
          claim would result in any liability extending to the trust account is small.
          If
          we wind up our affairs in compliance with either Section 280 or 281(b)
          of the
          DGCL following a dissolution, pursuant to Section 282 of the DGCL, the
          potential
          liability of our stockholders will be limited to the lesser of the stockholder’s
          pro-rata share of any claim or the amount distributed to the stockholder.
          As we
          do not anticipate seeking dissolution under the complex procedures of Section
          280, we expect that, in accordance with Section 281(b), we will seek stockholder
          approval of a plan of dissolution to provide for our payment, based on
          facts
          known to us at such time, of existing and pending claims, and claims that
          may be potentially brought against us within the subsequent 10 years. We
          estimate the costs associated with the implementation and completion of
          such a
          plan of dissolution and liquidation to be approximately $50,000 to $75,000,
          which would be funded by any funds not held in our trust account and funds
          released to us to fund working capital.
 20
 **Risks
        associated with the outsourcing industry in India**
 
 ***There
        is intense competition in the market for outsourcing
        services.***
 
 Certain
        factors may affect the competitive landscape in the outsourcing industry,
        including divestitures and acquisitions that result in consolidation within
        the
        industry. These changes may result in larger competitors with significantly
        more
        resources. In addition, some competitors may add or announce plans to add
        cost-competitive offshore capabilities to their outsourcing service offerings.
        These competitors may be able to offer their services using the offshore
        and
        onsite model more efficiently than the acquired business. A number of these
        competitors may also have significantly more experience with international
        operations and significantly greater financial, technical and marketing
        resources, generate greater revenues, have more extensive existing client
        relationships and technology partners and have greater brand recognition
        than
        the acquired business. Consequently, following a business combination, we
        may be
        unable to compete successfully against these competitors.
 
 ***An
        acquired businesses’ revenues could be significantly affected if the laws of the
        government in which it operates, restrict companies from outsourcing work
        to
        foreign companies.***
 
 In
        the
        United States, despite some economic recovery, unemployment levels have not
        declined significantly from the pre-economic recovery levels. There has been
        concern among the legislators about the impact of outsourcing on unemployment
        levels in the United States. For example, legislation has been proposed to
        prohibit federal and state governments from outsourcing IT and IT enabled
        services to foreign companies. Legislators have also proposed to introduce
        economic deterrents for U.S. companies outsourcing work to foreign companies.
        If
        such proposed laws come into effect, we could be prevented from performing
        certain outsourcing services.
 
 ***Wage
        pressures in India may prevent an acquired company from sustaining a competitive
        advantage and may reduce its profit margins.***
 
 Wage
        costs in India have historically been significantly lower than wage costs
        in the
        United States and Europe for comparably skilled professionals, which we expect
        will be one of the competitive strengths of a company we acquire. However,
        if,
        following a business combination, wages for skilled professionals increase
        in
        India, we may not be able to sustain this competitive advantage, which could
        negatively affect profit margins. In addition, we may need to increase the
        levels of an acquired company’s employee compensation to remain competitive with
        other employers, or seek to recruit in other low labor cost areas to keep
        its
        wage costs low. Compensation increases may result in decreased
        profitability.
 
 ***Exchange
        controls in India may limit our ability to utilize our cash flow effectively
        following a business combination.***
 
 Following
        a business combination, we will be 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. Following
        a business combination, we will likely be a FEMA company as a result of our
        ownership structure. Such companies are permitted to operate in India without
        any special restrictions, effectively placing them on par with wholly Indian
        owned companies. However, we cannot assure our stockholders that the Indian
        authorities will eliminate or continue to relax foreign currency restrictions.
        Any future restrictions on currency exchanges may limit our ability to use
        our
        cash flow for the distribution of dividends to our shareholders or to fund
        operations we may have outside of India.
 
 21
 ***Returns
        on investment in Indian companies may be decreased by withholding and other
        taxes.***
 
 Following
        a business combination, investments we may make in India could 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. Following a business combination, any withholding taxes paid by
        us on
        income from our investments in India may or may not be creditable on our
        income
        tax returns.
 
 Following
        a business combination, we intend to avail ourselves of income tax treaties
        with
        India to seek to minimize any Indian withholding tax or local tax otherwise
        imposed. However, there is no assurance that the Indian tax authorities will
        recognize application of such treaties to achieve a minimization of Indian
        tax.
 
 ***India
        has different corporate disclosure, governance and regulatory requirements
        than
        those in the United States which may make it more difficult or complex to
        consummate a business combination.***
 
 Companies
        in India are subject to accounting, auditing, regulatory and financial standards
        and requirements that differ, in some cases significantly, from those applicable
        to public companies in the United States, which may make it more difficult
        or
        complex to consummate a business combination. In particular, the assets and
        profits appearing on the financial statements of an Indian company may not
        reflect its financial position or results of operations in the way they would
        be
        reflected had such financial statements been prepared in accordance with
        U.S.
        GAAP. Moreover, companies in India are subject to a different regulatory
        scheme
        than United States companies with respect to such matters as insider trading
        rules, tender offer regulation, shareholder proxy requirements and the timely
        disclosure of information. Accordingly, appropriate adjustments to the financial
        statements of an Indian company may be required in order to appropriately
        determine the underlying valuation of the Indian company.
 
 Legal
        principles relating to corporate affairs and the validity of corporate
        procedures, directors’ fiduciary duties and liabilities and shareholders’ rights
        for Indian corporations may differ from those that may apply in the United
        States, which may make the consummation of a business combination with an
        Indian
        company more difficult than a business combination with a company based in
        the
        United States.
 
 ***Foreign
        currency fluctuations could cause a business combination to be more
        expensive.***
 
 Because
        our business objective is to acquire one or more operating businesses with
        primary operations in India, changes in the U.S. dollar-Indian rupee exchange
        rate may affect our ability to achieve such objective. The exchange rate
        between
        the Indian rupee and the U.S. dollar has changed substantially in the last
        two
        decades and may fluctuate substantially in the future. If the U.S. dollar
        declines in value against the Indian rupee, any business combination will
        be
        more expensive and therefore more difficult to complete. Furthermore, we
        may
        incur costs in connection with conversions between U.S. dollars and Indian
        rupees, which may make it more difficult to consummate a business
        combination.
 
 22
 ***Certain
        sectors of the Indian economy are subject to government regulations that
        limit
        foreign ownership, which limits our ability to achieve our business objective
        which is to acquire one or more operating businesses with primary operations
        in
        India.***
 
 The
        Indian government prohibits investments in certain sectors and limits the
        ownership in certain other sectors. We intend to avoid sectors in which foreign
        investment is disallowed. This could limit the possible number of acquisitions
        that are available for investment. The Indian government also regulates
        investments in certain other sectors (e.g., banking) by increasing the amount
        of
        ownership over time. The management team will evaluate the risk associated
        with
        investments in sectors in which ownership is restricted. However, there can
        be
        no guarantee that management will be correct in its assessment of political
        and
        policy risk associated with investments in general and in particular in sectors
        that are regulated by the Indian government. Any changes in policy could
        limit
        our ability to achieve our business objective which is to acquire one or
        more
        operating businesses with primary operations in India.
 
 If
        the
        relevant Indian authorities find us or the target business with which we
        ultimately complete a business combination to be in violation of any existing
        or
        future Indian laws or regulations, they would have broad discretion in dealing
        with such a violation, including, without limitation:
 
 •
              Levying
                  fines;
 •
              Revoking
                  our business and other licenses;
                  and
 •
              Requiring
                  that we restructure our ownership or
                  operations.
 
 ***The
        requirement that Indian companies provide accounting statements that are
        in
        compliance with United States Generally Accepted Accounting Principles (GAAP)
        may limit the potential number of acquisition
        targets.***
 
 To
        meet
        the requirements of the United States Federal securities laws, in order to
        seek
        stockholder approval of a business combination, a proposed target business
        will
        be required to have certain financial statements which are prepared in
        accordance with, or which can be reconciled to, GAAP and audited in accordance
        with U.S. Generally Accepted Auditing Standards (GAAS). GAAP and GAAS compliance
        may limit the potential number of acquisition targets.
 
 ***If
        political relations between the U.S. and India weaken, it could make a target
        business’ operations less attractive.***
 
 The
        relationship between the United States and India may deteriorate over time.
        Changes in political conditions in India and changes in the state of
        Indian-United States relations are difficult to predict and could result
        in
        restrictions on our future operations or cause potential target businesses
        to
        become less attractive. This could lead to a decline in our profitability
        following a business combination.
 
 23
 ***Because
        the Indian judiciary will determine the scope and enforcement under Indian
        law
        of almost all of our target business’ material agreements, we may be unable to
        enforce our rights inside and outside of India following a business
        combination.***
 
 Indian
        law will govern almost all of our target business’ material agreements, some of
        which may be with Indian governmental agencies. Therefore a target business
        or
        businesses may not be able to enforce their material agreements and certain
        remedies may not be available outside of India.
 
 ***The
        laws of India may not protect intellectual property rights to the same extent
        as
        those of the United States, and we may be unsuccessful in protecting
        intellectual property rights following a business combination and may also
        be
        subject to third party claims of intellectual property
        infringement.***
 
 The
        one
        or more businesses we acquire will likely rely on a combination of patent,
        copyright, trademark and design laws, trade secrets, confidentiality procedures
        and contractual provisions to protect its intellectual property. However,
        the
        laws of India may not protect proprietary rights to the same extent as laws
        in
        the United States. Therefore, efforts to protect such intellectual property
        may
        not be adequate. Furthermore, competitors may independently develop similar
        technology or duplicate its products or services. Unauthorized parties may
        infringe upon or misappropriate its products, services or proprietary
        information.
 
 ***Following
        a business combination, we may be liable to our clients for damages caused
        by
        disclosure of confidential information or system
        failures.***
 
 Following
        a business combination, we may have access to, or will be required to collect
        and store, confidential client and customer data in connection with our
        outsourcing services. Following a business combination, many of our client
        agreements may not limit our potential liability for breaches of
        confidentiality. If any person, including any of our employees, penetrates
        our
        network security or misappropriates sensitive data, we could be subject to
        significant liability from our clients or from our clients’ customers for
        breaching contractual confidentiality provisions or privacy laws. Following
        a
        business combination, unauthorized disclosure of sensitive or confidential
        client and customer data, whether through breach of our computer systems,
        systems failure or otherwise, could damage our reputation and cause us to
        lose
        clients.
 24
 The
        procedures required for us to liquidate under the DGCL, or a vote to reject
        any
        plan of dissolution and distribution by our stockholders, may result in
        substantial delays in the liquidation of our trust account to our public
        stockholders as part of our plan of dissolution and distribution.
 
 **Item
        2. Unregistered Sales of Equity Securities and Use of
        Proceeds.**
 
 On
        April
        5, 2006, we consummated our initial public offering of 6,156,250 units and
        on
        March 31, 2006 sold 93,750 units in a private placement to our existing officers
        and directors, through an entity they own. On April 5, 2006, we consummated
        the
        closing of 923,437 additional units that were subject to the underwriters’
over-allotment option. Each unit consists of one share of common stock and
        one
        redeemable common stock purchase warrant. Each warrant entitles the holder
        to
        purchase from us one share of our common stock at an exercise price of $5.00.
        The units were sold at an offering price of $8.00 per unit, generating total
        gross proceeds of $57,387,496. Rodman & Renshaw, LLC acted as lead
        underwriter. The securities sold in the offering were registered under the
        Securities Act of 1933, as amended, on a registration statement on Form S-1
        (No.
        333-128008). The Securities and Exchange Commission declared the registration
        statement effective on April 5, 2006.
 
 We
        incurred a total of $3,964,625 in underwriting discounts and commissions.
        Rodman
& Renshaw, LLC, the representative of the underwriters in the Offering
        deposited 4.0% of the gross proceeds attributable to the underwriters’ discount
        ($0.32 per unit or $2,265,499) into the trust fund that will be paid to the
        underwriters only upon the consummation of a business combination (and then
        only
        with respect to the units as to which the components shares have not been
        redeemed). We paid a total of $1,699,125 in underwriting discounts and
        commissions and approximately $722,713 has been paid for costs and expenses
        related to the Offering.
 
 After
        deducting the underwriting discounts and commissions and the offering expenses,
        the total net proceeds to us from the offering were approximately $55,350,251
        (including the private placement), of which $54,913,370 (or $7.76 per unit
        sold
        in the offering) was deposited into a trust fund and the remaining proceeds
        are
        available to be used to provide for business, legal and accounting due diligence
        on prospective business combinations and continuing general and administrative
        expenses.
 
 For
        additional information on our use of proceeds from our public offering, please
        see Item 2 of Part I in this report.
 
 **Item
        3. Defaults Upon Senior Securities.**
 
 Not
        applicable.
 
 **Item
        4. Submission of Matters to a Vote of Security Holders.**
 
 Not
        applicable.
 
 **Item
        5. Other Information.**
 
 Not
        applicable.
 
 25
 **Item
        6. Exhibits.**
 
 (b)
              Exhibits
 
 31.1
              Certification
                  of Principal Executive Officer and Principal Financial Officer
                  pursuant to
                  Rule 13a-14(a)of
                  the Securities Exchange Act, as
                  amended.
  32.1
              Certification
                  of the Principal Executive Officer and Principal Financial Officer
                  pursuant to18
                  U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
                  Act of 2002.
 
 26
  **SIGNATURES**
 
 In
        accordance with the requirements of the Exchange Act, the registrant caused
        this
        report to be signed on its behalf by the undersigned, thereunto duly
        authorized.
 
 PHOENIX INDIA ACQUISITION CORP.Date:
                August 11, 2006
              By:
              /s/
                Ramesh AkellaRamesh
                AkellaPresident,
                  Chief Strategy Officer and Director
                (Principal
                  Executive Officer and Principal Financial
                  Officer)
  27