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Wednesday 20 November 2019

NEWSLETTER, 20-XI-2019











DELHI, 20th November 2019
Index of this Newsletter


INDIA

– GENERAL POLICY, INFRASTRUCTURES, COUNTRY FINANCES, ETC. 


1.1. Nobel for poverty warriors
1.2. Opinion | Sub-optimal philanthropy is not the answer to inequality
2.1. To reach $5 trillion mark, economy must grow at 10-12%: Manmohan Singh
2.2. Lessons from London's pollution revolution
3.1. Opinion | For lithium ion batteries to pave the way for a rechargeable India
3.2. Uber CEO Khosrowshahi urges Indians to shun car ownership ‘trap’
4.1. India's household wealth growth crawls, debt jumps: Credit Suisse study
4.2. The state of social infrastructure in metros
5.1. India to be innovation capital of the world; Start-ups to power India's growth: Piyush Goyal
5.2. India and its unhealthy children


– AGRICULTURE, FISHING & RURAL DEVELOPMENT


6.1. Dr. Harsh Vardhan launches Food Safety Mitra (FSM) scheme for strengthening and scaling up 'Eat Right India' movement
6.2. India registers 26.9 per cent decline in Maternal Mortality Rate since 2013
7.1. Environment Clearance to IOCL to set up new 2G Ethanol plant at Panipat
7.2. APEDA eyes US$ 60 billion agriculture exports with support of new policy
8.1. International Tractors Ltd signs up JV to enter China
8.2. Opinion | Over-regulation of e-commerce could stifle its growth
9.1. Release of two diagnostic kits developed under 'Make in India' initiative by Indian Council of Agricultural Research - Indian Veterinary Research Institute, Izatnagar
9.2. India's organic products exports surge by 50 per cent in 2018-19: APEDA
10.1. Nestlé India: revenue growth up, but dearer milk eats into margins
10.2. New World Bank Project to Support Climate Resilient Agriculture for 125,000 Small holder Farmers in Odisha


– INDUSTRY, MANUFACTURE


11.1. Open to partnerships for JLR, but no plans to sell it: Chandrasekaran
11.2. 6 ways to reignite India’s auto industry
12.1. Not Mahindra or Tata, Hyundai Kona is the EV of choice for govt
12.2. Chinese auto firms eye GM’s last plant in India
13.1. Opinion | A policy agenda to meet India’s steep employment challenges
13.2. Mahindra to acquire 100 per cent stake in Peugeot Motocycles to explore new markets
14.1. PepsiCo India wins US award for saving more than 17 billion litres of water
14.2. Why India needs deep tech startups
15.1. Microsoft set to invest $200 mn in Ola, boost connected car tie-up
15.2. Total buys 37.4 per cent stake in Adani Gas for Rs 5,662 crore


– SERVICES (IT, R&D, Tourism, Healthcare, etc.) 


16.1. India's service excellence to be showcased in GES 2019
16.2. Software products are booming: TCS COO
17.1. Given rock-bottom expectations, Wipro’s Q2 show will be cheered
17.2. Glenmark Pharma gets USFDA nod for prostate cancer treatment drug
18.1. AYUSH Minister inaugurated Ayurveda Palliative Care Unit at base Hospital
18.2. Aurobindo Pharma gets USFDA nod for Guaifenesin generic
19.1. Guidelines released for evaluation of nano-pharmaceuticals in India
19.2. Why HCL Technologies’ stock fared better than its larger peers
20.1. IndiGo places mega order for 300 Airbus jets
20.2. Vistara to order 26 CFM engines worth $2.4 bn for 13 new Airbus A320 Neos


INDIA & THE WORLD 

21.1. Hunger, starvation and Indian soldiers in World War II
21.2. Opinion | Angela Merkel’s inclusive and firm leadership shall be missed
22.1. Protectionism should worry India
22.2. India signs MoU with Saudi Arabia to launch RuPay card in Gulf Kingdom
23.1. NPCI expects UPI user base to expand to 500 million in next 3 years
23.2. UN paints food waste picture
24.1. Amazon launches 'Project Zero' in India to block counterfeit goods
24.2. The shrinking of India’s middle class
25.1. Opinion | Capitalism needs reinvention to see off its political challenges
25.2. The young knight of the chess world


* * *

DELHI, 20th November 2019

NEWSLETTER, 20-XI-2019



INDIA

– GENERAL POLICY, INFRASTRUCTURES, COUNTRY FINANCES, ETC. 



1.1. Nobel for poverty warriors 
Livemint, 14 Oct. 2019
  • Esther Duflo,  her India-born husband Abhijit Banerjee,  and Michael Kremer win top  Economics honour for an experimental approach to tackling poverty 
  • The trio shifted spotlight from grand plans to poverty as a lived reality 
Development economics has often displayed some insensitivity to those it aims to uplift—the poor. They were either treated as lifeless objects that could be moved around to satisfy the grand plans of a master builder, or seen as exasperatingly unable to make the best of opportunities that wise governments offered them. The three development economists who have been awarded the 2019 Nobel Prize for Economics, Abhijit Banerjee, Esther Duflo and Michael Kremer, have led a revolution that has overturned that status quo. The trio has redeveloped the field of development economics with the aid of new experimental methods that put researchers in direct contact with the poor. The spark of this revolution was lit by Angus Deaton, who won the Economics Nobel in 2015 for his work on consumption choices of the poor as well as how to accurately measure poverty. Banerjee, Duflo and Kremer have taken that torch ahead. “What spending time with the poor taught me is that the poor have much more complicated lives than us," Duflo told Mint in 2011.

The trio has been in the vanguard of three big shifts in their field of work. First, development challenges are now viewed through an appropriate lens, the lives of the poor (rather than large statistical models), with a special focus on how incentives, information and constraints shape actual choices. Second, their use of randomized control trials has lent credibility to poverty research and helped solve old riddles of causality. Third, their expertise has led to the formulation of policies that go by evidence, not assumptions. The result has been a burst of insights and fresh answers to good questions. Does microfinance actually boost entrepreneurship among the poor? Why do the poor spend so much on entertainment? How does subsidized healthcare impact the investment that have-nots make in their own health? However, the trio’s experimental approach is not without its critics. Some argue that the findings may not be universally applicable. Others carp that an obsession with tracing the causal links of one phenomenon to another could baffle those who frame policy; does it really help knowing if today’s farm investments in technology depend on whether the area’s land tenure system was based on zamindari or ryotwari a hundred years ago? Another critique is that field trials tend to miss the big structural changes that influence the political economy of a country.

The trio has been in the vanguard of three big shifts in their field of work
The big lesson from the work of the three laureates is best captured in a 2005 paper by Banerjee and Duflo, Growth Theory through the Lens of Development Economics. In this, they argue that people and firms in developing economies are unable to adopt modern tools and make the most of all that’s available because they are held back by such things as government failure, lack of access to credit, behavioural snags and sundry factors beyond their control. The aim of development policy, they have taught us, should be to identify these constraints and figure out how to ease them. Banerjee, Duflo and Kremer have shifted the spotlight from grand plans to actual poverty as a lived reality in all its microscopic detail. For that, they deserve the Nobel Prize for Economics.


1.2. Opinion | Sub-optimal philanthropy is not the answer to inequality 
Livemint, 29 Oct. 2019, R. Jagannathan

Corporations and the wealthy need to make larger contributions to bring about a material change

Over the past decade, many businessmen and super-rich individuals have had attacks of conscience over growing inequality. In 2010, Warren Buffett and Bill and Melinda Gates created The Giving Pledge to get billionaires to commit over half their wealth to charity. To date, 204 billionaires have signed up.

A parallel movement, called Pledge1%, one supported vociferously by another billionaire, Marc Benioff of salesforce.com, a company valued by the stock market at around $135 billion, has tried to extend such an oath even to people who are not billionaires. The idea is to commit people to giving 1% of their equity, time, products or profits to charity, thus taking the idea even to startups that may not have generated their first dollar in profit.

There is no doubt that capitalism and capitalists will need to become more conscientious about giving large parts of their incomes and wealth away if governments are not to make laws to snatch them away. However, they also need to realize that giving small bits of wealth is not going to move the needle on inequality. While The Giving Pledge is broadly on the right track, since the amounts pledged would at least top current inheritance taxes in most countries which have them, the Pledge1% movement is clearly sub-optimal.

Giving 1% of a startup’s equity is no use when eight out of 10 will not survive five years. Allotting 1% of your time to charity work is roughly three to four days a year. This volunteerism may be useful for some causes that could use freelance work, but it is little more than tokenism. Giving 1% of your products may make no sense in an era when most tech products are free for users anyway (consider Gmail, Google Maps and free apps), and the products you develop may not be relevant to the poor, who are the intended beneficiaries.

In India, even a high profit-earning company like Infosys gives 1% of its net profits to charity, but one can hardly think of this as making a substantial dent on any kind of inequality. The Tatas have been keeping large chunks of group equity in Tata Sons, whose dividends go substantially to charity. But in an era when Tata Sons is also a holding company that needs to invest in equity, or write off losses in group companies, the total quantity available for charity is again likely to be sub-optimal. One should ask whether shares intended to generate money for charity ought to be part of the promoters’ controlling stake. In this case, charity and control serve divergent purposes.

Perhaps the one Indian billionaire who has indeed moved the needle on contributions is Azim Premji, who, while retaining voting control of Wipro, has transferred two-thirds of the economic benefits of his shareholding to charitable activities. This makes a difference, though in such cases too the question is how long a promoter can retain control without substantial economic ownership too. Shareholders and those in control ought to have convergent economic interests for shareholder capitalism to work well.

One can also go back to an earlier era of global giving by governments, when the World Bank and its soft-lending arm, the International Development Association, exhorted rich countries to give 1% of their GDP as official development assistance to the poor. Few countries did even this, and soon, this too evaporated.

If one had to choose between the Buffett-Gates-Premji and Benioff-Tata-Infosys models of giving, the former wins hands down. The advantage of the Benioff model is that it asks people to start small and give as much as they can. This is not to be rubbished. However, sub-optimal contributions can’t do much to reduce inequality in any country. If at all charity by the rich is to work, it is profitable companies and the super-rich who need to start giving in a big way.

The reality is that startups make their best contribution merely by being there. Even though many will not live to see their fifth birthdays, while they are around, they are the ones creating a large number of jobs. That is even better than charity.

One US study by John Haltiwanger, Ron Jarmin and Javier Miranda found that startups accounted for only 3% of employment, but almost 20% of gross job creation. In short, the real contribution of startups to society lies in the jobs they create while they exist, and not in contributing 1% of their equity to charity.

It is alright to talk of a shift from shareholder capitalism to stakeholder capitalism, wherein corporations do not think of maximizing returns only for equity owners, but we need to avoid the pitfalls of treating minor contributions as worthy of emulation. Corporate and super-rich philanthropy need larger contributions, and not small sub-optimal donations that make no difference at all to inequality and deprivation.

Perhaps The Giving Pledge could be expanded to leave not only 50%-plus of one’s wealth to charity, but also an equal proportion of one’s current income, if sizeable. This will help reduce inequality, especially if these contributions exceed the taxes that have to be paid on income, wealth and inheritance.

True charity is charity only if it substantially exceeds current levels of taxes payable.

R. Jagannathan is editorial director, ‘Swarajya’ magazine


2.1. To reach $5 trillion mark, economy must grow at 10-12%: Manmohan Singh
Livemint, 17 Oct. 2019, Jayshree P. Upadhyay, Anuja
  • Responding to Sitharaman’s comments, Singh said the NDA should have ‘learnt from our mistakes’ 
  • Manmohan Singh was addressing a meeting of representatives of the business community on the state of the economy in Mumbai 
Former Prime Minister Manmohan Singh said achieving the $5 trillion target for the economy, set by the Narendra Modi administration, is not possible under current circumstances, with annual growth projected to cool to 6% or slower according to some estimates.

With the growth rate declining, there is no hope of reaching this target by 2024, Singh said on Thursday. “For reaching the $5 trillion mark, the economy would need to grow at 10-12% per annum. What is happening under the BJP (Bharatiya Janata Party) government is that the growth rate is declining. Even the International Monetary Fund (IMF) has come up with a statement that India’s growth rate will be only 6.1% as against 7%, which was mentioned some months ago," said Singh.

IMF on Tuesday slashed its economic growth forecast for India to 6.1% for the current fiscal from its July projection of 7%, citing weaker than expected outlook for domestic demand. IMF also lowered India’s FY21 GDP growth forecast by 20 basis points to 7.2%.

Singh was addressing a meeting of representatives of the business community on the state of the economy in Mumbai. Maharashtra is heading to the polls on 21 October. Singh, a veteran Congress leader, held the interaction as part of the party’s campaign in the poll-bound state.

Singh, an economist widely credited for ushering in the economic liberalization in India as the finance minister at the time, maintained that respective BJP-led governments at the Centre and in states are obsessed with “fixing blame on its opponents" rather than adopting people-oriented policies.

“They talk about doubling the foreign flows; I don’t think they are in sight. They talk about creating two crore jobs, but exact opposite is happening. The government is only interested in headline management and not concrete steps," he said.

Responding to finance minister Nirmala Sitharaman’s recent statement that public sector banks had the “worst phase" under the combination of former prime minister Singh and former Reserve Bank of India governor Raghuram Rajan, Singh said: “This government has now been in office for five years. It should have learnt from our mistakes and provided a credible solution for the economy."

“The industrial slowdown is coming in the way of India optimally utilizing its demographic dividend," Singh said.

Making a specific pitch for Maharashtra, the former finance minister said that while the state used to be the number one in investment, it was now infamous for being the state with the highest number of farmer suicides.

“Maharashtra used to be number one in investment; today, it is a leader in farmer suicides. They are caught between the trap of low income and high debt. The obsession with low inflation is inflicting misery on our farmers and the Union government’s import-export policy is hurting them further. People from Maharashtra are already grappling with low availability of clean drinking water," he said.

According to a Right to Information (RTI) query, 396 farmers in Maharashtra committed suicide between 1 January and 28 February this year. Between 2013 and 2018, more than 15,000 farmers committed suicide in the state.


2.2. Lessons from London's pollution revolution
Livemint, 14 Oct. 2019, Vivek Menezes
  • As India gears up for horrific smog, here’s how London created workable solutions to fight pollution 
  • India is home to 20 of the world’s 25 most polluted cities. Air pollution levels spike dramatically in the national capital and most of north India every November. 
For New Delhi and most of north India, November qualifies for being the “cruellest month". That’s when air pollution levels spike dramatically from the year-round hazardous to well-nigh fatal, with almost every year surpassing previous highs for toxicity. Last year, post-Diwali smog moved Delhi’s chief minister Arvind Kejriwal to tweet that “Delhi has become a gas chamber" as the air quality index spiked to nearly 1,000 (below 50 is considered safe), which was then roughly ten times worse than Beijing.

This year, it’s still only October, but Kejriwal has already announced restrictions on the use of private cars, massive distribution of free face masks, and 1,000 new electric buses for the public transport network. Kejriwal’s urgent actions in the capital are commendable, but the problem extends across the region.

Subcontinental woes

According to AirVisual, the leading source of international air quality data, India is home to 20 of the world’s 25 worst polluted cities (as measured by the levels of fine particulate matter—PM 2.5 and PM 10—which can penetrate deep into the lungs). Faisalabad and Lahore in Pakistan are also in the bottom 10.

If you add in Dhaka in Bangladesh (at No. 17) that means only two cities outside the subcontinent (Hotan and Kashgar in China) register in this dismal litany of failure. There’s especially cruel irony to see the heavily touted standard-bearer of India’s global competitiveness, Gurugram in Haryana redlined as the worst polluted city on the planet.

Yet it is undeniable, as we have learned in Delhi with some of Kejriwal’s moves making headway, that these abysmal scenarios can shift and change towards improvement. The shining example for India is right across the border in China, where stringent but easily replicable measures have produced impressive results in a host of cities. The country’s comprehensive legal standards and strict environmental law enforcement have propelled Beijing entirely out of AirVisual’s list of the 100 most polluted cities in the world. It’s currently at 122. The UN Environment Programme’s chief scientist has said, “Beijing’s efforts, achievements, experiences and lessons in air pollution control over the last 20 years are worth analysing and sharing in order to progress global environmental governance."

Surprising London

Even with China’s rapid advancements, the somewhat unexpected standout leader of international urban sustainable development efforts has emerged all the way on the other side of the globe. This is London, under mayor Sadiq Khan (he was elected in 2016), who has derided his city’s “filthy, toxic air" as “a public health emergency".

With great tactical success, he has positioned the problem in a social injustice framework, saying that “the children living and studying in pollution hotspots, which are often located in the poorest parts of our city, are growing up with underdeveloped and stunted lungs. This isn’t just unacceptable, it’s shameful". This provides rationale for “the most ambitious plans to tackle air pollution of any big city in the world".

Khan can speak with great resonance about inequality, because he made it into the highest echelons of British politics the hard way. The fifth of eight children born into a working-class immigrant family in South London—his father was a bus driver, and his mother a seamstress—he grew up in a cramped council flat. Now, the first-ever Muslim mayor of a major city in the West serves both as beacon and lightning-rod. A few months ago, US President Donald Trump tweeted a series of extraordinary personal insults his way, “Sadiq Khan, who by all accounts has done a terrible job as Mayor of London…is a stone cold loser who should focus on crime in London, not me….Kahn [sic] reminds me very much of our very dumb and incompetent Mayor of NYC, de Blasio, who has also done a terrible job - only half his height."

The Goan connection

Soon after taking office, Khan, whose grandparents had migrated from Lucknow in Uttar Pradesh to Pakistan following the Partition, reached out to Shirley Rodrigues, who was born into a Goan family in Nairobi, to serve as his deputy mayor for environment and energy, and tasked this veteran of environmental policy-making with tackling London’s air pollution problems.

Her new boss said at that time, “Shirley will drive forward the urgent action needed to ensure Londoners no longer have to fear the air we breathe, and will address the failure to tackle the problem by the previous mayor and government…(she) is the perfect person to deliver my agenda."

Then the duo moved dramatically. In just a few months it was amply clear to the world these two policymakers, with roots in Pakistan and India, were now at the forefront of combating the effects of pollution in cities.

By the time this fact became popularly known, I had already become fascinated by what Rodrigues and Khan were managing to achieve, watching along with great interest from an urban vantage in the tiny, but increasingly troubled and deteriorating, capital city of India’s smallest state. My home town Panjim has no heavy industry, and is gloriously situated along the shoreline where the Mandovi river meets the Arabian Sea. Stiff ocean breezes ruffle our curtains all day long. Yet, despite all this, air pollution has steadily worsened to worrisome. All through the winter months last year, PM 2.5 levels remained significantly higher than what is normally considered safe. All around me, there’s a rapidly burgeoning epidemic of respiratory problems (which plague all three of my sons). So it’s not just north India, the country’s urban blight has now reached as far as my idyll on the Konkan coast.

London’s innovations

Rodrigues and Khan began to turn London around with bold innovations that would have seemed unthinkable just a few years ago. I eventually found myself reaching out to the deputy mayor via her Twitter account, to ask if she would consent to being interviewed about London’s anti-pollution agenda. Shirley Rodrigues’s office is evidently overwhelmingly busy, because it took several months for responses to emailed questions to reach my desktop (at one point, lasting weeks, I was told by her press office they were “being looked at by the final sign off director").

Nonetheless, I finally got to learn more about the most ambitious green agenda of any major world city, embedded with many lessons for the rest of us.

Rodrigues wrote, “London’s environment plays a vital role in making the city so attractive to visit, live, and work in. Our air, water, and green spaces are precious, but they need our help to ensure they are protected, improved, and continue to deliver the greatest possible benefits for Londoners. In May 2018 we published the city’s first-ever integrated Environment Strategy, aiming to make London greener, cleaner, and ready for the future."

The deputy mayor pointed out the obvious benefits of an integrated approach. “We’re tackling environmental issues together, to ensure that our policies support each other. For instance, making sure that policies to reduce the use of diesel cars to cut air pollution don’t lead to a switch back to petrol cars which contribute towards climate change. We’ve also drawn strong links between environment, health, social, fairness, and economic agendas," she wrote.

She then went on to articulate the future road map: “We have set a very ambitious vision for 2050 with detailed plans, policies, and pathways for the near- and medium-term, including making London zero carbon, zero waste, and with a zero emission transport network."

The zero tolerance zone

The deputy mayor pointed to the remarkable success of Central London’s Ultra Low Emission Zone (ULEZ), which in April became the world’s first 24-hour, 365-days-a-year area with toughest global emission standards. The zone imposes a hefty daily fee on cars which emit more than 75g/km of carbon dioxide. Now, 35% fewer such vehicles show up on city streets, and the city has earned £55 million to reinvest in its transportation network.

Rodrigues told Mint, “The mayor has committed to extend the ULEZ to inner London, up to the north and south circulars in October 2021, and to tighten standards for heavy vehicles in the London-wide Low Emission Zone in October 2020. We will also keep cleaning up London’s transport system and phasing out fossil fuels, including diesel, making the whole bus fleet zero-emission by 2037. By October 2020 every bus in London—all 9,000—will meet or exceed the ULEZ standards. It’s an unprecedented transformation to make London’s famous red buses go green."

She was unequivocally clear about what our collective priorities must be, “Environmental threats are real and present, and cities must be prepared for them—it’s an issue of social and environmental justice. Air pollution is an international health emergency that needs to be urgently tackled. There is a huge economic cost (£3.7 billion in London alone), (but) bold action on addressing our environmental challenges is paying off."

Rodrigues went on to explain: “New research shows how London’s strength as a global climate hub is growing, despite the challenges of Brexit uncertainty. Total sales of Low Carbon Goods and Environmental Services have grown from £20.9 billion to £39.7 billion over the last decade, an increase of 90%, with a 20% increase between 2015-16 and 2017-18 alone. Meanwhile, the number of people working in the sector in London has grown from 155,953 to 246,073 over the same period, an increase of 58%."

These are the kinds of numbers promised by the newest generation of American politicians led by 29-year-old phenomenon, Alexandria Ocasio-Cortez, who promises a “Green New Deal" phasing out fossil fuels while overhauling the nation’s infrastructure.

But, while this idealistic cohort is still finding its feet and facing down virulent opposition in Washington, the exact same logic is being translated into real world policy initiatives in London, which is drawing the rapt attention of every urban planner and city administrator on the planet. Rodrigues said she and Khan take this responsibility seriously. “We know that as a major global city, others look to London to lead and be a source of inspiration on how to tackle environmental challenges. But we are also keen to learn. The mayor often says he is happy to steal others’ good ideas! To support this, we regularly share good practices and examples of cutting-edge solutions from London so others can follow our lead and learn from our successes."

In conclusion

How can it be that two grandchildren of the subcontinent can forge so spectacularly ahead in creating workable solutions to the precise problems dragging down the cities in their ancestral homelands into unimaginable depths? How is it that pollution barely registers as an election issue anywhere across South Asia?

Here, the coda to the great architect and urban planner Charles Correa’s landmark essay Great City…Terrible Place rings unerringly like prophecy. “If you drop a frog into a saucepan of very hot water, it will desperately try to hop out. But if you place a frog in tepid water and then gradually, very very gradually, raise the temperature, the frog will swim around happily adjusting to the increasingly dangerous conditions. In fact, just before the end, just before the frog cooks to death, when the water is exceedingly hot, the frog relaxes, and a state of euphoria sets in. Maybe that is what is happening to us."

Vivek Menezes is a Goa-based writer and photographer.


3.1. Opinion | For lithium ion batteries to pave the way for a rechargeable India
Livemint, 13 Oct. 2019, Nitin Pai

While China has an advantage in lithium battery production, India could turn competitive with a couple of components

It is hard to know how many members of the committees that decide various Nobel prizes have personal experience of the inventions they often indirectly honour. But I am sure every single member of the Royal Swedish Academy of Sciences, which selected John B. Goodenough, M. Stanley Whittingham and Akira Yoshino as this year’s Chemistry laureates, uses lithium-ion batteries. While the Academy gave in to a little hyperbole when it declared “they created a rechargeable world", it was nevertheless on the mark in saying that “lithium-ion batteries have revolutionised our lives since they first entered the market in 1991. They have laid the foundation of a wireless, fossil fuel-free society, and are of the greatest benefit to humankind."

As an engineer designing mobile communication devices in the mid-1990s, I recall struggling with the battery dilemma. Higher data rates and bigger display screens demanded more battery power, but the Nickel Metal Hydride (NiMH) batteries I was working with then were big, heavy and slow to charge. While Moore’s Law applied to microchips, which became faster, smaller and cheaper over time, battery performance would change more slowly. Our devices would be big, bulky and heavy. Slow charging cycles meant that we had to provide our mobile phones with an extra battery with an external charger, which would be left to charge while the device was being used. The lithium-ion battery dramatically changed the scene. 

By the time the industry began to adopt it, though, I was no longer in the business, but vividly recall my overjoyed former colleagues talking about lithium-ion technology as if it had liberated us from a foreign oppressor.

More recently, these batteries have been busy liberating the transportation industry. While batteries constituted half the total cost of an electric vehicle a few years ago, they now account for only a third. According to a research note (bloom.bg/2GkXJvO) published by BloombergNEF’s Nikolas Soulopoulos, falling battery costs will make certain types of electric cars cheaper than their internal combustion engine counterparts by 2022. Not quite Moore’s Law pace, but still pretty fast for a battery.

A combination of new sources of lithium supply, innovations in mining technology, manufacturing improvements, economies of scale and battery management systems are contributing to the declining costs of these batteries. Chinese companies dominate the lithium-ion battery industry, from extraction of the mineral to exports of cells and batteries. While not quite the Saudi Arabia of lithium—Australia and Chile are bigger producers—Chinese firms currently control almost half the global lithium production and 73% of the global cell manufacturing capacity (https://bit.ly/33libFu; bit.ly/2B0W6zN).

India imports lithium-ion cells from China, Taiwan and South Korea, and battery assembly capacity of 1 gigawatt hour (GWh), or about 0.3% of global capacity. According to CleanTechnica, India imported $1.23 billion worth of lithium-ion batteries in 2018-19, six times higher than in 2014-15 (bit.ly/2JD1VZl). Dependence on imports, and on China, has led the concerned Narendra Modi government to propose the setting up of giga factories in India (bit.ly/2B0WJt9). CleanTechnica estimates that India will need a minimum of 10GWh of cells by 2022 and 50GWh by 2025. In comparison, China is expected to have over 600GWh of annual battery production capacity by 2023 (bit.ly/2SRVyoa). Even if domestic capacity is created in India to meet these levels of domestic demand, it is unlikely to be price competitive vis-Ă -vis Chinese imports.

There are three components to lithium-ion batteries: the basic cell, the battery pack and the battery management system. A complete battery includes several cells in a pack controlled by a management system.

Getting into the cell game is risky even for investors with deep pockets. Amara Raja Batteries Ltd’s Jayadev Galla reflected the hesitation of Indian firms to invest in manufacturing capacity ahead of demand when he told a World Economic Forum audience (bit.ly/2B1b4WB) that the electric vehicle “ecosystem has to be in place first so that there is predictable and a growing demand for electric vehicles before we get into cell manufacturing." The government too should not rush in to commit billions of dollars to a technology that could change quickly.

It may be more prudent for India to focus on the other two components. Battery packs are more resistant to changes in cell technology, and battery management systems can leverage India’s strengths in software. My colleague Saurabh Chandra, who is also co-founder of Ati Motors, a startup making autonomous commercial vehicles, argues that securing intellectual property in battery management systems and thermal management of batteries is a better strategy for India.

Given that India lacks lithium reserves, we should consider “urban mining"—the extraction of minerals from waste—as a possibly strategic alternative, and not just for lithium. A recent market research report projects a recycled lithium-ion battery capacity of 23GWh worth a billion dollars by 2030 (bit.ly/2ozjK3J). With 2030 demand projected to be over 125GWh and the geopolitical risks of relying on China, lithium is one more reason to strengthen relations with Australia.

Nitin Pai is co-founder and director of The Takshashila Institution, an independent centre for research and education in public policy


3.2. Uber CEO Khosrowshahi urges Indians to shun car ownership ‘trap’
Livemint, 23 Oct. 2019, Shreya Nandi, Leroy Leo
  • Dara Khosrowshahi said very high car ownership is a trap that can prevent innovation 
  • Uber launched Uber Transit at select Delhi Metro stations, making it the first city in Asia for the service 
New Delhi: Uber Inc. chief executive Dara Khosrowshahi on Tuesday dived into the raging debate in India on whether millennials prefer purchasing cars over other options such as electronic gadgets.

Khosrowshahi urged Indians to resist falling into the trap of owning cars, like their counterparts in the developed world, and instead take on these so-called “established industries" by focusing on innovations to make travel convenient.

He said there is very high car ownership in the developed countries, which is “a trap that can sometimes prevent innovation because you have a central infrastructure that is designed for the last 10 years versus infrastructure that is designed for the next 10-20 years."

Khosrowshahi comments follow the government’s recent statement that a change in mindset, especially among millennials is affecting car sales in India.

Last month, finance minister Nirmala Sitharaman attributed the fall in car sales, among other factors, to millennials not wanting to commit to monthly instalments for buying cars and instead preferring to take app-based taxis such as Ola and Uber. She found support from R.C. Bhargava, chairman, Maruti Suzuki India Ltd, who in an interview said many youngsters are preferring gadgets over cars as they can continue using Ola and Uber for their mobility needs which is much more economical.

“For the newer generation, the dream is not to own a car but the freedom to have any kind of service on demand. I think that established protocols and industries are enemies of innovation and India can be a trailblazer by taking on established industries," Khosrowshahi said.

He was speaking to reporters during an event to announce Uber’s tie-up with Delhi Metro Rail Corporation (DMRC) to provide last mile transportation services.

His comments come in the backdrop of India becoming a key focus region for the ride-hailing platform, especially in the aftermath of losing the battle in China to local rival Didi Chuxing.

Uber CEO Dara Khosrowshahi presents a memento to Dr. Mangu Singh, Managing Director of Delhi Metro Rail Corporation, at an event in New Delhi (Photo: Reuters)

India is one of Uber’s largest markets globally, and Khasrowshahi said the San Francisco-based company has committed to continue its investments in the country for the next 5-10 years.

India’s automobile sector is the middle of its worst slump in about two decades amid a slowdown in the economy, led by sluggish demand and slowing private investment.

“The opportunity here in India is that India doesn’t need to be trapped by this establishment. India can actually be an innovator at mass for the developing countries in the world and can be a trailblazer and today we can look back at a day when innovation was accelerated," Khosrowshahi said.

Uber on Tuesday launched a commuter service, Uber Transit, at select Metro stations in Delhi, making it the first city in Asia for the service. The firm already runs the service in eight cities globally.

Under the public transport feature, riders will be able to see the fastest and cheapest routes to the Metro station, real-time schedules as well as departure time for public transportation, including Metros and buses. Walking directions, to and from nearby Metro stations and bus stops, can also be viewed, Uber said in a statement.

The service will be expanded to 210 Metro stations in a phased manner.

Uber did not disclose investment and commercial details of the partnership with DMRC.

DMRC managing director Mangu Singh said Uber’s service has started at four stations. “We are open to all service providers. Whoever wants to provide a service to our passengers, we are ready to help them," Singh said.

Pradeep Parameswaran, president for Uber’s India and South Asia operations, said recent amendments in the Motor Vehicles Act will help the company focus on innovations and scale, rather than facing regulatory uncertainty.

The Motor Vehicles (Amendment) Act, 2019 recognized aggregators as digital intermediaries or marketplaces, which can be used by passengers to connect with a driver for transportation.

Uber’s global chief product officer, Manik Gupta, said the company has partnered with local transit app provider MoovIt for the data, which will be shown to users on the Uber app. The company will look to expand to other cities if the service receives a positive response from customers, Gupta said in an interview.


4.1. India's household wealth growth crawls, debt jumps: Credit Suisse study
Livemint, 22 Oct. 2019, Neil Borate
  • Household wealth grew by 5.2% in dollar terms in the year till 30 June against the 11% average growth in the 20 yrs to 2019 
  • The report estimates that 78% of India’s adult population has wealth below $10,000, while 1.8% of India’s population has more than $100,000 
Mumbai: Wealth creation in India slowed to a crawl in the year ended 30 June even as household debt jumped, a Credit Suisse study found.

India’s total household wealth grew by 5.2% in dollar terms in the period, the Credit Suisse Global Wealth Report released on Monday said. Net wealth per adult grew at 3.3%, sharply slower than the average 11% growth rate reported in the 20 years to 2019, the report said.

India, however, remains one of the fastest wealth creators in the world, with household wealth in dollar terms growing faster than any other region.

The slowdown in wealth creation coincides with a downturn in the Indian economy, which grew at the slowest pace in six years in the three months ended 30 June. Growth in private consumption expenditure also slumped to an 18-quarter low of 3.1% in the June quarter, indicating a negative wealth effect.

Overall, the Credit Suisse report found that non-financial assets of Indian households grew by 6.9% in 2018-19, outpacing the 1.4% growth in financial assets.

The last time household wealth grew at a slower pace was in 2017-18, when it expanded 2.6%. But that was largely due to the sharp weakening of the rupee in that year — a 7-8% rise in asset values was offset by an almost 5% currency depreciation.

In 2018-19, Indian asset prices grew at a slower pace of nearly 6% but foreign exchange fluctuations were more favourable.

The report estimates wealth per Indian adult at $14,569 ( ₹10.31 lakh as on 21 October). However, the average number is skewed heavily by a few wealthy individuals.

The report estimates that 78% of India’s adult population has wealth below $10,000, while 1.8% of India’s population has more than $100,000.

At the other extreme, 1,790 adults have wealth over $100 million. India accounts for 2% of the world’s millionaires.

Indians hold an average of about $13,000 in physical assets and roughly $3,000 in financial assets. There is also a debt of $1,345 per adult.

The Credit Suisse report also found that the increase in household wealth in India in 2018-19 was mostly driven by rising home prices.

“The returns from real estate have come down in the past few years, and this is a major factor that has contributed to the slowdown in the growth of household wealth," said Gaurav Awasthi, senior partner, IIFL Wealth Management Ltd.

Nilanjana Chakraborty and Sabari Saran in New Delhi contributed to this story.


4.2. The state of social infrastructure in metros
Livemint, 20 Oct. 2019, Sriharsha Devulapalli, Vishnu Padmanabhan

Residents in Hyderabad enjoy the best access to schools and public healthcare facilities among five of the country’s metros, suggests a Mint analysis

Millions move to India’s metros in search of a better life, but which metro delivers this the best? Answering this is difficult, but one measure could be access to education and public healthcare. Access to schools and health facilities are the first steps to a prosperous life. And taken together, Hyderabad fares the best on both measures among five of the country’s metros—Bengaluru, Delhi, Mumbai, Chennai and Hyderabad (Kolkata was excluded from this analysis because of lack of data).

For instance, according to the latest available data (as of August 2019), Hyderabad has the most schools (4,903) and, even after adjusting for population, has the greatest school density (0.57 schools for every 1,000 residents). The school data, compiled by the ministry of human resource development and the National Informatics Centre, includes all types of schools (private and public; primary and secondary; co-educational and non-coed). Chennai, with 1,478 schools at 0.26 schools per 1,000 residents, fares the worst.

The caveat with the entire analysis is that it focuses only on access and not quality. A city may have more schools but the number of schools says little about the quality of education they provide.

Hyderabad also leads in access to public healthcare. Healthcare access is measured in terms of the number of primary healthcare and state hospitals, compiled by the ministry of health and family welfare in 2015 (the latest year for which granular data is available), and does not include any private sector health facilities.

Using this measure, Hyderabad has 401 health centres, 0.05 centres per 1,000 residents. And though Delhi has far more health centres (588), after adjusting for population, its residents have less access to public healthcare compared to Hyderabad’s.

Within cities, though, there are significant differences. To capture these differences, across both education and healthcare, Mint constructed a social infrastructure index, which counts the number of schools and government healthcare centres at the ward level, and then adjusts for the ward’s population.

On this index, four of the five highest-scoring wards are all in Delhi, with Khichripur in north and Roshanpura in southwest scoring the highest. At the other end of the spectrum, Raj Nagar in Delhi and Champapet in Hyderabad have the lowest scores. Champapet, though, is an anomaly in Hyderabad where most of the wards enjoy better access to schools and health centres compared to other metros.

Within these other metros though, there are some patterns in differences in access. For instance, in Mumbai and Delhi, wards in the southern part of the city score higher than the northern parts. While in both Bengaluru and Chennai, wards in the core of the cities fare better than those on the periphery.

A common explanation for these kinds of differences is wealth and segregation within cities. Using population data on Scheduled Castes and Scheduled Tribes (SCs/STs) at the ward level, we find no correlation between wards with a greater share of SC/ST population and the wards’ social infrastructure score. But this could be a reflection of our sample (only metro wards) and our narrow definition of public goods provision.

For instance, in a new paper, Anjali Adukia of the University of Chicago and others show how urban segregation does affect the provision of public goods in Indian cities. Analysing administrative data from 3,000 cities, they find that within cities, areas with greater populations of SCs/STs and Muslims have access to less public goods (in terms of schools, doctors and public hospitals).

In Mumbai, wards in the southern part of the city score higher than the northern parts.


On this index, four of the five highest-scoring wards are all in Delhi, with Khichripur in north and Roshanpura in southwest scoring the highest


Champapet is an anomaly in Hyderabad where most of the wards enjoy better access to schools and health centres compared to other metros.

Chennai, with 1,478 schools at 0.26 schools per 1,000 residents, fares the worst


In Bengaluru, wards in the core of the cities fare better than those on the periphery

Pooja Dantewadia contributed to this story. This is the seventh of a 10-part series on life in Indian cities.


5.1. India to be innovation capital of the world; Start-ups to power India's growth: Piyush Goyal
IBEF, Oct.16, 2019

Union Minister of Commerce & Industry and Railways, Mr. Piyush Goyal participated in the 3rd edition of India Energy Forum 2019 by CERAWeek in New Delhi today. Piyush Goyal was part of the Indian Ministerial panel along with R. K. Singh, Minister for New and Renewable Energy and Pralhad Joshi, Minister of Coal and Mines. The discussions were conducted by Daniel Yergin, Pulitzer prize winning author, speaker and energy expert.

During the discussions Commerce and Industry Minister said that India has naturally emerged as the startup capital of the world with the highest registered startups and he applauded the suo moto decision of the oil PSUs, under the Petroleum Ministry, to set up a startup fund that will encourage Indians to innovate and set up their own companies. Piyush Goyal further said that India will soon become the innovation capital of the world and informed that during his interactions with young innovators, even in the remote parts of the country, youngsters come forth with bright ideas to solve number of economic and social problems that prevail in India today. He said that he is extremely proud of the young girls and boys who are the driving force behind the start-up revolution taking place in India today.

Commerce and Industry Minister further said that he is not worried about the state of the world in this time of trade wars as these were issues waiting to be addressed. He further added that countries of the world cannot develop when few countries are giving subsidies and nurturing an eco-system of unfair trade and competition among industries' the need of the hour to have a more balanced development across the world and distributed sources of wealth creation, said Piyush Goyal. There is need for free trade but there is greater need for fair trade said Commerce and Industry Minister as this will work in the interests of all countries and India supports the new dynamics of world trade. He further said that multilateralism will prevail, and India supports all fair and honest global efforts to do away with all unfair trade practices. He further informed that India will continue to support those countries that are struggling to get manufacturing back to their own countries and hoped that the existing system of prosperous countries outsourcing their pollution and emission to the developing world, in the garb of creating jobs but in reality ruining the health of the population and destroying the future prosperity of the citizens by outsourcing problems to developing countries, must stop immediately.

Piyush Goyal also informed that by 2023 Indian railways will be fully electrified and by 2030 the Indian Railways will use only renewable and clean energy. He hoped that there will be more FDI in the energy sector as 100 per cent FDI is allowed in this sector and there is requirement of around 70 billion US$ investment in India’s energy sector which is on the cusp of a revolution as there is great demand for energy in India because the country hopes to achieve self-sufficiency in domestic production of the energy requirements for every household. During this interaction he further informed that the India - US relations are robust with great potential to move forward and it is time for India - US relations to make a quantum leap if trade between the two countries must reach half trillion US$.

India is the third largest energy consumer in the world in absolute terms, after the United States, but per capita energy consumption is very low. There is need for a healthy mix of all commercial energy sources and India is today on the path of energy transition where 95% of households have access to electricity in the country today but there is increasing demand for energy which has to be fulfilled if India has to achieve the target of 450 megawatts set by Prime Minister of India, Narendra Modi.

During the India Energy Forum delegates from Indian and regional energy companies, institutions and governments participated in various sessions related to the energy sector in New Delhi from October 13-15, 2019.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.


5.2. India and its unhealthy children
Livemint, 22 Oct. 2019, Rukmini S

Affluent states like Gujarat are failing to ensure their poorer children have a decent diet and that the richer ones are protected from lifestyle diseases

India’s healthiest children live in its north-eastern states and Kerala, an analysis of a new national survey conducted by the government shows, but children in these states are also at greater risk of ‘lifestyle diseases’. However, some of the most affluent states - particularly Gujarat, Maharashtra and Haryana - perform the worst on both sides of the spectrum; Gujarat is the country’s unhealthiest state for children.

Released earlier this month, the Comprehensive National Nutrition Survey (CNNS) collected primary information on the medical health and allied behaviours from over 1.12 lakh children between the ages of 0 and 19 across 30 states. The CNNS expands on the data covered by key past health surveys, including the National Family Health Survey, to give a more rounded and more detailed look into the health and lives of India’s children. It includes an expanded range of anthropometric measures to comprehensively capture malnutrition and previously unstudied micronutrient deficiencies.

To come up with a composite health indicator, we aggregated over 50 indicators to create six sub-indicators — diet, malnutrition, iron deficiency, micronutrient deficiency, non-communicable diseases and obesity — and ranked all 30 states on each indicator and sub-indicator. From the six sub-indicators, we composed a final ranking.

The diet sub-indicator looked at four indicators that deal with healthy eating practices and the composition of meals. The malnutrition sub-indicator looked at 17 indicators that dealt with different anthropometric measures of malnourishment, including both traditional measures, like height-for-age (stunting) and weight-for-age (wasting), and less commonly used measures, such as waist circumference and body fat. The anaemia and iron deficiency sub-indicator comprised of six indicators while the micronutrient indicator looked at deficiencies comprising 18 indicators including levels of Vitamin A, vitamin B12, zinc, and sodium. The non-communicable disease indicator looked at 19 indicators pertaining to diabetes, hypertension, cholesterol and other conditions. Finally, the obesity sub-indicator used a range of anthropometric measures to consider 13 indicators of weight. The indicators dealt with children in three groups - those aged 1-4, those aged 5-9 and adolescents aged 10-19.

Unsurprisingly, the better off states including those in the south and north-east have India’s healthiest children, and the Gangetic belt states have among India’s least healthy children. However, there are some significant exceptions. For instance, West Bengal and Odisha do better at ensuring young children have a diversified diet, relative to its income. In addition to the poorer northern states, richer states like Maharashtra, Telangana, Gujarat and Andhra Pradesh feature in the bottom of this distribution. These same states do poorly at ensuring children receive iron-rich foods (natural, homemade or fortified). Even in the rest of the number, the numbers are stark; just three states manage to ensure that even one out of five children between the age of 6-23 months gets a minimum acceptable diet.

As a result, India continues to make very little progress on anaemia; the fourth round of the National Family Health Survey found that the prevalence among women fell by just two percentage points and that among men by one percentage point between 2005-06 and 2015-16. Prosperous states including Punjab, Haryana and Gujarat have a high prevalence of anaemia and iron deficiency among children.

The CNNS also makes significant progress in measuring a range of vital micronutrients in the bodies of children, beyond iron which can be critical for health. “While deficiencies of individual micronutrients can have an adverse effect, multiple micronutrient deficiencies can have a disabling effect on children and adolescents even when deficiencies are mild to moderate," the report notes. In Gujarat, over a quarter of all children are deficient in Vitamin D and over 50% of adolescents aged 10-19 are deficient in zinc. West Bengal is the best-performing state on this sub-indicator, despite its relatively lower prosperity.

Across a range of new anthropometric measures approved by World Health Organization, the northern states and Gujarat fare the worst. These results also reinforce the well-studied idea that heights in India are not purely genetically determined. Children in the north-eastern states are less likely to have abnormally low height for their age than those in the northern states.

Yet, the states that provide better nutrition to children are also at risk of obesity and the precursors to non-communicable ‘lifestyle diseases’. For instance, over 10% of adolescents in Delhi are classified as hypertensive (high blood pressure), and nearly a quarter of 5-9 year-olds in Sikkim and West Bengal have high cholesterol.

Managing these new threats, that are typically associated with richer countries, will be an important public health challenge for states that are doing a better job of caring for their poor; the greater challenge lies before states failing at both ends.

This is the first of a three-part series on insights from the Comprehensive National Nutrition Survey.
Rukmini S. is a freelance journalist based in Chennai.


- AGRICULTURE, FISHING & RURAL DEVELOPMENT 


6.1. Dr. Harsh Vardhan launches Food Safety Mitra (FSM) scheme for strengthening and scaling up 'Eat Right India' movement
IBEF, Oct. 17, 2019

"By motivating key players in the system who can reach out to people at large, we can reach out to each individual. We have to include every section of the society so that Eat Right India becomes a country wide movement." Dr Harsh Vardhan, Union Minister of Health and Family Welfare said at the function to commemorate World Food Day 2019, here today. The theme for this day was 'Healthy Diets for a Zero Hunger World'. To mark the occasion, Dr Harsh Vardhan also launched the 'Food Safety Mitra (FSM)’ scheme, along with the 'Eat Right Jacket', and 'Eat Right Jhola' to strengthen food safety administration and scale up the 'Eat Right India' movement.

Dr. Harsh Vardhan emphasized that the Eat Right India movement is a crucial trigger for the much needed social and behavioural change. This campaign along with the 'Fit India' Movement' can achieve huge success if the right strategy is adopted and efforts are made to reach out to every section of the society. Dr. Harsh Vardhan further stated that people should adopt Gandhiji's messages of eating less, eating safe and healthy food, and reduce wastage of food while developing the habit of sharing surplus food. Citing the example of polio to highlight multi-sectoral approach, Dr Harsh Vardhan stated "All of us have to take up this responsibility in our own capacities. I believe that together we will be able to develop new approaches to combat challenges to health and society," he added.

Highlighting the critical importance of a Jan Andolan on issues around food safety, Dr Harsh Vardhan said that small positive actions can be performed by individuals or organisations to strengthen the cause of food safety and food wastage.

The 'Food Safety Mitra (FSM)' scheme will support small and medium scale food businesses to comply with the food safety laws and facilitate licensing and registration, hygiene ratings and training. Apart from strengthening food safety, this scheme would also create new employment opportunities for youth, particularly with food and nutrition background. The FSMs would undergo training and certification by FSSAI to do their work and get paid by food businesses for their services. The first batch of 15 FSMs were awarded certificates today (Details of the scheme are available at https://fssai.gov.in/mitra/).

The 'Eat Right Jacket' launched today will be used by the field staff. This jacket has a smart design to hold tech devices like tablets/smart phone, a QR code and RFID tag for identification and tracking. Apart from providing safety to field staff on duty, this would bring in efficiency, professionalism and transparency in food safety administration and bring in a sense of ownership & visibility of FSOs. The 'Eat Right Jhola', a reusable cloth bag shall replace plastic bags for grocery shopping in various retail chains. Since on repeated use, bags are often contaminated with microorganisms and bacteria, proper and regular washing of cloth bags is essential to ensure safety and hygiene. These cloth bags are being provided on rental basis through a private textile rental service company.

FSSAI has partnered with the Domestic Workers Sector Skill Council (DWSSC) under the Ministry of Skill Development and Entrepreneurship to launch a training course for domestic workers and homemakers across the country. In the first phase, one lakh domestic workers and homemakers will be trained through training partners of DWSSC in association with RWAs. This would be scaled up in due course.

For scaling up the Eat Right India movement across the country, FSSAI has got endorsement of several celebrities. Two short films, on repurposing of used cooking oil into biodiesel and, nutrition in the first 1000 days of life featuring Shri Virat Kohli and Ms. Juhi Chawla respectively, were released on the occasion.

Dr. K. Subramanian, Chief Economic Advisor, Govt. of India, Mr. Arun Maira, former member of Planning Commission of India & former India Chairman of Boston Consulting Group, Shri Santosh Desai, CEO, Future Brands and Shri Sangram Singh, the world-renowned professional wrestler were also present at the function. Also present at the event were Shri Pawan Agarwal, Chief Executive Officer (FSSAI), Shri Amod K. Kanth, founder of Prayas, along with other stakeholders from the Government, Scientific community, food businesses and corporates of the sector.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same. 


6.2. India registers 26.9 per cent decline in Maternal Mortality Rate since 2013
IBEF, Nov. 08, 2019

According to the Sample Registration System Bulletin-2016, India has registered a 26.9 per cent reduction in Maternal Mortality Ratio (MMR) since 2013. The decline in MMR has been from 77 to 72 per 100,000 live births among southern states and in the other states, from 93 to 90, it stated.

The ratio has seen a decline from 167 in 2011-13 to 130 in 2014-16 and 122 in 2015-17, registering a 6.15 per cent reduction since the last survey figures of 2014-2016, according to the special bulletin of the Office of the Registrar General.

"It is heartening that the maternal mortality ratio has declined from 130 in 2014-2016 to 122 in 2015-17. The decline has been most significant in empowered action group (EAG) states and Assam from 188 to 175", it said.

In order to understand the maternal mortality situation in the country in a better way and to map the changes that have taken place at the regional level, the state categorisation is done by the government into three group- EAG, southern states and other state.

The sustainable development goals target of 70 per 100,000 MMR have already been met by states like Kerala, Maharashtra and Tamil Nadu while Andhra Pradesh and Telangana are within "striking distance", a senior health ministry official said.

The states under EAG are Bihar, Jharkhand, Madhya Pradesh, Chhattisgarh, Odisha, Rajasthan, Uttar Pradesh and Uttarakhand, and Assam while Andhra Pradesh, Telangana, Karnataka, Kerala and Tamil Nadu are under southern states criteria and the "other" states categories cover the remaining states and Union territories.

Maternal death is a rare event and thus requires a large sample size to provide estimates. In order to improve the SRS sample size, the results were obtained after the practice of pooling three years' data to generate reliable estimates of maternal mortality, the bulletin stated.

The first report on maternal mortality in India (1997-2003), describing trends, causes and risk factors, was released in October 2006.

India's progress in reducing the MMR was lauded by WHO last year saying the improvement puts the country on track towards achieving the Sustainable Development Goal (SDG) target of an MMR below 70 by 2030.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.


7.1. Environment Clearance to IOCL to set up new 2G Ethanol plant at Panipat
IBEF, Nov. 11, 2019

Furthering the Government of India's commitment in promoting the use of environmentally friendly products, the Ministry of Environment, Forest and Climate Change has given Environment Clearance to Indian Oil Corporation Limited (IOCL) to set up new 2G Ethanol plant at Panipat.

The Union Minister of Environment, Forest & Climate Change (MoEFCC) and Information & Broadcasting, Shri Prakash Javadekar announced this in a tweet today.

IOCL had earlier submitted a proposal seeking Environmental Clearance for its proposed 100 KLPD Ligno-Cellulosic 2G Ethanol Plant in Baholi, Panipat district of Haryana. The estimated investment in setting up the plant is Rs 766 crore (US$ 109.60 million). It is noteworthy to mention that Central Government has identified production and use of ethanol as one the thrust area to reduce import dependency and increase farmers' income. The Ethanol produced will be used for blending in transportation fuel.

It is also pertinent to highlight that recently the Central Government had declared that no separate environmental clearance is required to produce additional ethanol from B-heavy molasses as it does not contribute to the pollution load, giving further benefits to farmers and the sugar industry.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.


7.2. APEDA eyes US$ 60 billion agriculture exports with support of new policy
IBEF, Nov. 11, 2019

With the help of the new agriculture export policy, the agri exports from India is likely to reach the export target of US$ 60 billion by the year 2022, said Agricultural and Processed Food Products Export Development Authority (APEDA) a statutory body under Ministry of Commerce. The policy has acted as a bridge between Ministry of Commerce and Ministry of Agriculture helping in to reach the target.

"Achieving an agriculture export target of US$ 60 billion by 2022 does not look ambitious, given the current global market conditions. More so, because India's export basket largely comprises meat, marine products, and basmati rice whose demand in the world market is on constant increase," said Mr. Tarun Bajaj, GM, APEDA.
"With an integrated approach and better cooperation among the two union ministries for boosting agriculture production and trade increase export of organic food products as well as to double Agri-exports to US$ 60 billion by 2022 from current $38 billion" said Mr. Bajaj.

APEDA gives a platform to display India's quality produce to the global market along with promoting the export of various agricultural commodities. Mr. Bajaj added, "After the announcement of Agri Export Policy (AEP) by the government, all the concerned ministries which includes Ministry of Commerce, Ministry of Agriculture, Ministry of Animal Husbandry, Ministry of Food Processing Industries and other agencies are working in close coordination, they are also focusing on exports. In addition, involving states since they also have an important role in encouraging exports of agriculture products from the region."

APEDA and Nurnberg Messe India jointly organised Biofach India which was inaugurated by APEDA Chairman Mr. Paban Kumar Borthakur where around 200 Indian organic food products companies exhibited their products at the event.

"India exported organic products worth Rs 5,151 crore (over US $ 757 million) in 2018-19, from Rs 3,453 crore (US$ 515 million) in 2017-18 registering an increase of about 49 per cent. The major demands under the organic product category are for flax seeds, sesame and soybean; pulses such as arhar (red gram), chana (pigeon pea); and rice, along with tea and medicinal plants. USA and European Union member-countries were the biggest buyers of organic products. There is a growing demand from Canada, Taiwan and South Korea in recent years, Germany is one of the biggest importers of Indian organic products. Now, many new countries are also taking interest" he said.

As per the industry estimates, India organic agricultural products market is about Rs 8,500 crore (US$ 1.22 billion). Exports account for nearly 60 per cent at Rs 5150 crore (US$ 736.8 million) while domestic market is estimated at Rs 2,500 crore (US$ 357 million). Compared to international trade of about US$ 97 billion Indian market seems to be very small but it is growing very fast," he added.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same. 


8.1. International Tractors Ltd signs up JV to enter China
IBEF, Oct. 22, 2019

Punjab-based International Tractors Ltd (ITL), the homegrown tractor manufacturer announced a joint venture (JV) with Shandong Luyu Heavy Industry Company Ltd to enter into the world’s second-largest tractor market.

According to the statement, the JV agreement was signed by Deepak Mittal, managing director, ITL, and Yang Shao Jie, founder and chairman, Shandong Luyu Heavy Industry Company Ltd. in New Delhi on 19 October. The entity will be named as Luyulika (Laizhou) Agri Machinery Company Ltd. The financial advisor to ITL was KPMG.

The venture will invest an amount of US$ 10 million to set up an assembly plant for tractors and engines with a manufacturing capacity of 50,000 units in the first phase and the expansion will be planned in further time. 

Shandong Luyu Heavy Industry has presence in small-sized loaders, small and medium-sized excavators and forklifts in China and is worth at around US$ 400 million. The Chinese company also exports products with its existing facility located at Laizhou Shahe Industrial Park in Shandong province.

The Indian tractor maker will expand it business overseas through the JV and also help the company in China to expand its product line up with tractors and tractor engines. The statement also said the JV will assemble engines for wheel loader application for captive consumption of Shandong Luyu Heavy Industry and other wheel loader construction machinery manufacturers in China.

ITL exports tractor engines that can also be deployed for several other similar applications in adjacent sectors including construction equipment.

"Today ITL has presence in more than 120 countries and is a trusted brand among more than one million farmers in both India and overseas. We are taking a leap ahead with the formation of this JV. The engine assembly plant in China is a first by an Indian company," said Deepak Mittal, managing director, ITL.

Jie of Shandong Luyu Heavy Industry Company Ltd said, "We believe that this JV will be able to penetrate with Sonalika range of tractors in China. It shall also help us to offer the globally accepted engine technology of Sonalika to its customers."

In the meantime, the company plans to combine its portfolio of tractors and farm equipment by introducing two new brands - Solis and Yanmar in India. The two brands will sell together with ITL's domestic tractor brand Sonalika, which now is among the top three tractor brands in India.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.


8.2. Opinion | Over-regulation of e-commerce could stifle its growth
Livemint, 30 Oct. 2019, Lalit Bhasin

E-commerce is not a threat and can not only create new jobs but also enable kirana stores to grow their reach

With sales numbers from the recently concluded e-commerce sale season belying the perceived economic slowdown, the e-commerce sector’s resilience indicates an increasingly sharper understanding of what both India and Bharat want. For this, India’s e-commerce industry deserves kudos.

In this context, it was surprising to hear that the government’s department for promotion of investment and internal trade (DPIIT) has asked these e-commerce marketplaces for a host of details, mostly investigative in nature. Along with looking into the volume of business, investments, commission agreements, and lists of sellers and distributors, the DPIIT has asked them to confirm compliance with rules relating to the goods and services tax in letter and spirit. The timing of these requests, and their nature, covering capital structure details, business models and inventory management systems, raise a simple question: Is the value derived from e-commerce’s co-existence with traditional businesses being undermined because of the fear of a business model that benefits all but is still seen by some as a threat?

That value has several dimensions. The foremost is e-commerce’s impact on India’s 12 million kirana stores. Accounting for 88% of the country’s total retail market revenues, these neighbourhood shops have an unparalleled ability to serve hyper-local needs. This is also the basis of the e-commerce-kirana win-win proposition. While kirana stores enable the online marketplace to excel in helping products reach last-mile destinations in hinterland markets, they benefit from the extra revenue stream that comes from this partnership. Kirana shops also benefit as they can adopt international best practices for better management of their inventory and the expansion of their reach. Kirana outlets and e-commerce can go hand in hand, and their joint strength can result in significant job creation in line with the government’s policy and skill development goals.

It also must be noted that amid a perceived nationwide slowdown in consumption, India’s e-commerce sector has recorded its highest sales ever. Notably, a significant chunk of the ₹19,000 crore gross merchandise value across the six-day festive sale run by online platforms came from small-town India. This indicates that e-commerce is generating sufficient value for all buyer classes, enabling it to boost consumption in a way that is both exponential and inclusive. A plethora of product sellers are getting access to e-commerce marketplaces that could have been difficult to tap, thus giving them greater reason to participate. The fact that e-commerce majors have regularly reiterated their vision of drawing more Indian buyers and sellers into their fold, with both seeking to make the most of rising mobile penetration and favourable demographics, speaks well of its future prospects.

The potential of job creation in e-commerce is evident from the extent to which it has penetrated India’s retail and consumption ecosystem. As it sustains its growth trajectory, e-commerce can emerge as a leading generator of jobs in areas ranging from delivery, logistics and data-analytics to product and brand experience, design and inventory management, as well as support functions such as finance, payments, legal and human resources. Newer and more specialised competencies, including payment gateways, big data and mobile technology are being harnessed to give consumers a hassle-free purchase experience.

It should also be appreciated that e-commerce today is not a monolith. The sector comprises a growing number of players of various sizes. To remain competitive, they will all have to make regular investments that would place our workforce on a par with its global counterparts, while also serving to acquire and sustain a business advantage that enables the sector to surge ahead.

Having whetted India’s purchase palate, e-commerce is giving equal shelf space to domestic artisans and small- and medium-sized manufacturers, granting them access to local, national and even global markets. As the e-commerce sector grows and deepens, its engagement with both the “classes" and the “masses" of India, so to speak, its status as a multiplier of prosperity, can only grow.

India’s e-commerce sector has benefited from a pro-business policy environment. It is where it is today, to an extent, on account of government initiatives such as Digital India, Skill India, Startup India and Make in India. Today, placed at the intersection of economic growth, job creation and unprecedented market access for enterprises of all sizes, the e-commerce growth story epitomizes the inclusiveness of the Indian economy set in motion by government policies.

While strategically designed and implemented regulations have a place in our economy, being overly critical of a marketplace that currently serves as a beacon of commercial success may inadvertently stifle its growth and bring back the worst of the Licence Raj regime. The sector’s multifaceted positives and its evolving nature have led the government to adopt a consultative approach. Such consultations must continue. As one of the fastest growing online retail markets among the economies of the world, the sector must be assured of a fair policy framework to support India’s emergence as a $5 trillion economy by fiscal year 2024-25.

Lalit Bhasin is regional president, Indo American Chamber of Commerce


9.1. Release of two diagnostic kits developed under 'Make in India' initiative by Indian Council of Agricultural Research - Indian Veterinary Research Institute, Izatnagar
IBEF, Oct. 16, 2019

Two diagnostic kits developed by Indian Council of Agricultural Research (ICAR) - Indian Veterinary Research Institute (IVRI) under the 'Make in India' initiative, namely the Bluetongue sandwich ELISA (sELISA) and the Japanese Encephalitis lgM ELISA kit for the control of Swine and Detection of Antigen, were released by Shri Atul Chaturvedi, Secretary Department of Animal Husbandry & Dairying and Dr. T. Mahopatra, Secretary DARE and DG, ICAR at Krishi Bhawan today. This indigenous technology will not just help save foreign exchange as the newly developed kits cost ten times lesser than the imported ones but also has the potential to earn foreign exchange. 

Addressing the gathering, Dr. Trilochan Mohapatra briefed about the main characteristics of the two Kits. Talking about the Japanese Encephalitis (JE) ELISA Kit (IgM) for Swine, Dr. Mohapatra mentioned that the JE is a re-emerging viral zoonotic disease leading to death of children every year in the country. The kit developed by the ICAR-Indian Veterinary Research Institute is helpful for assessing the active infection of JE virus in the swine population which predicts the outbreak of JE in the humans. As compared to the commercial kit available in the market at a price of Rs. 52,000; the ICAR-IVRI developed is available for the farmers at a minimal price of Rs. 5,000 only. The Director General mentioned that each kit is meant for testing around 45 samples.

Highlighting the key features of another Kit "Bluetongue: Sandwich ELISA for detection of Antigen", Dr. Mohapatra stated that the Bluetongue (BT) virus is an insect-transmitted viral disease of domestic and wild ruminants that includes the camelid species. The disease is widespread among the sheep, goats, cattle, buffaloes and camels in the country. With the help of the Kit, the Bluetongue Virus can be controlled with the vaccination of susceptible animals, vector control and quarantine of infected animals with the good management practices. Apart from the vaccination, the early diagnosis and isolation of the infected animals are one of the commonly suggested preventive methods for controlling the spreading of the disease.

Shri Atul Chaturvedi applauded the joint initiative by the ICAR and the Department of Animal Husbandry as an incredible initiative. Shri Chaturvedi stated that release of these two Kits will be beneficial for not only the farming community, but the society. Citing about the number of casualties caused by the deadliest diseases in the societies every year, the Secretary mentioned that the Kits will prove to be a real helping hand.

Shri Sushil Kumar, Additional Secretary (DARE) & Secretary (ICAR) applauded the ICAR & Department of Animal Husbandry's initiative in the designated direction. Shri Kumar stated that the kits have been prepared with care. He accentuated that proper research works by the scientists of both the organizations were carried out before the official launching of the Kits. The Kits were also tested against the mentioned virus and diseases caused by the animals for their validity. 
Dr. R.K. Singh, Director, Indian Veterinary Research Institute emphasized on the measures to be adopted for controlling the spread of various harmful diseases by the birds, pigs and other animals. He stressed that humans are more prone to the transmittable diseases. He expressed his concerns about the various cases in which the children are more affected by the diseases as compared to the younger or older ones. He mentioned that the Kits will provide help in achieving our targets effectively and efficiently.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.


9.2. India's organic products exports surge by 50 per cent in 2018-19: APEDA
IBEF, Oct. 29, 2019

In 2018-19, India saw a rise of nearly 50 per cent with Rs 5,151 crore (US$ 757 million) in organic product exports.

As per the estimation done by Agriculture and Processed Food Products Exports Development Authority of India (APEDA), flax seeds, sesame, soybean, tea, medicinal plants, rice and pulses i.e. arhar and chana are the key organic food products that drove this growth.

Approximately 2.67 million tonnes of certified organic products are produced in India, including oilseeds, sugarcane, cereals and millets, cotton, pulses, medicinal plants, tea, fruits, spices, dry fruits, vegetables and coffee also produces the organic cotton fiber and functional food products.

"In terms of commodities oilseeds are the single largest category followed by sugar crops, cereals and millets, fibre crops, pulses, medicinal, herbal and aromatic plants and spices and condiments. The total volume of export during 2018-19 was 6.14 lakh tonnes," the statement added.

According to APEDA, as on March 31, 2019, total area under the organic certification process were registered under the National Programme which is basically for Organic Production is stood at 3.56 million hectares. This includes 1.94 million hectare cultivable area and other 1.49 million hectare for wild harvest collection. Along with the statement, APEDA, a statutory body under Ministry of Commerce and Nurberg Messe India are jointly organising Biofach India 2019 from 7th-9th November 2019 and is expected to be attended by more than 6,000 delegation of exporters, processors, retail chain industry, certification bodies and producers.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.


10.1. Nestlé India: revenue growth up, but dearer milk eats into margins
Livemint, 11 Nov. 2019, Pallavi Pengonda
  • Company was less affected by slump in demand, given its relatively higher exposure to affluent urban consumers 
  • A slower rate pace of growth in other expenses helped Ebitda performance 
Nestlé India Ltd reported impressive domestic revenue growth of 10.5% year-on-year for the September quarter. Analysts estimate this came on the back of 9% volume growth, which is easily the best when compared to other consumer firms. For perspective, volume growth of Hindustan Unilever Ltd, Godrej Consumer Products Ltd, Dabur India Ltd and ITC Ltd (cigarettes) stood at 5%, 7%, 4.8% and 3%, respectively.

Nestlé India is relatively less impacted by the current consumption slowdown, given its relatively higher exposure to affluent urban consumers, analysts at Jefferies India Pvt. Ltd said in a note to clients.

“NestlĂ© ’s stronger growth also indicates market share gains and a strong core portfolio. The aggressive pace of new innovations, success of new launches, and an improvement in demand environment could further accelerate its growth momentum," said analysts at Emkay Global Financial Services Ltd.

Despite the good showing, the company’s shares fell 2.5% after the results were announced. What gives?

To start with, volume growth was more or less along expected lines and was, therefore, factored into the share price. Besides, while revenue growth did not disappoint, profit margins were weak. Gross profit margin declined by 214 basis points year-on-year to 57.3%.

“The quarter witnessed higher commodity prices, particularly in milk and its derivatives, which are likely to continue in the near-term," said Suresh Narayanan, chairman and managing director of NestlĂ© India, in a press release. Some of this was offset by a decrease in other operating expenses as a percentage of revenues.

Analysts at ICICI Securities Ltd expect that the impact on margins from input cost inflation will be partially mitigated by the price hike in infant food products in 3Q CY19, cost efficiencies (like in 3Q) and a high base for 4Q CY18 (when the company had increased ad spends). Nestlé India follows a January-December fiscal year.

As pointed out earlier, the company’s impressive growth and much more is factored into its share price. The NestlĂ© India stock trades at around 60 times estimated earnings for calendar year 2020, after having risen more than 25% so far this year.


10.2. New World Bank Project to Support Climate Resilient Agriculture for 125,000 Small holder Farmers in Odisha
IBEF, Oct. 25, 2019

The Government of India, Government of Odisha and the World Bank today signed a US$ 165 million loan agreement to support smallholder farmers strengthen the resilience of their production systems as well as diversify and improve the marketing of their produce, for increased income.

The Odisha Integrated Irrigation Project for Climate Resilient Agriculture will be implemented in rural areas vulnerable to droughts and largely dependent on rainfed agriculture. It will benefit about 125,000 smallholder farmer households from 15 districts of Odisha managing 128,000 ha of agricultural land. The project will strengthen the resilience of smallholder farmers against adverse climate by improving access to resilient seed varieties and production technologies, diversifying towards more climate-resilient crops, and improving access to better water management and irrigation services.

The Government of India is implementing several missions under the National Action Plan on Climate Change, which also extensively leverages adaptation of climate-smart agricultural practices and technologies," said Shri Sameer Kumar Khare, Additional Secretary, Department of Economic Affairs, Ministry of Finance. "The project in Odisha is among several such initiatives supported by the government in our commitment to achieve the sustainable agriculture-related targets of the SDGs by 2030." he added.

The loan agreement was signed by Shri Sameer Kumar Khare, Additional Secretary, Department of Economic Affairs, on behalf of the Government of India; Shri Surendra Kumar, Principal Secretary, Water Resources Department on behalf of the Government of Odisha; and Mr. Junaid Ahmad, Country Director, India on behalf of the World Bank.

In recent years, climate variability has seriously affected agriculture in Odisha, where farming is largely dominated by farmers with landholdings of less than two hectares. More and more agricultural areas are coming under the ambit of extreme weather events. Since 2009, the frequency of droughts in the state has increased from 1 in 5 years to 1 in 2 years. Today, about 70 percent of total cultivated area is prone to droughts compared to 40 percent in the 1970s. In fact, since 2013, floods are now devastating areas beyond the traditional flood zone. Drier areas are projected to become drier, while wetter areas will become wetter. Agriculture is also a major source of Greenhouse Gas (GHG) emissions in Odisha, responsible for about 25 percent of the GHG emissions in the state.

"Across Odisha small-scale farmers are bearing the brunt of climate change. Erratic and extreme weather are responsible for declining yields and falling incomes. At the same time, agriculture is a large contributor to GHG emissions," said Mr Junaid Ahmad, World Bank Country Director in India. "The project is intended to be a game-changer for the State; creating a more resilient agricultural sector, enhancing food security, increasing farmers’ incomes and reducing the GHG footprint of the sector," he added.

The project will support the rehabilitation of 532 water tanks - expected to irrigate 91,435 ha; promote productivity improvements at the farm level; support farmers to reduce the current emphasis on food grains (especially paddy and wheat) and increase the share of high-value and more nutritious products like fruits and vegetables; and provide marketing support to farmers who are able to generate a marketable surplus.

The project will also support aquaculture in rehabilitated tanks, help farmers access affordable and quality fingerlings, and disseminate improved aquaculture practices and post-harvest management.

"Rehabilitating existing tanks will make agriculture more productive and climate-resilient for smallholder farmers," said Mr. Ranjan Samantaray, Senior Agriculture Specialist and World Bank's Task Team Leader for the project. "This project will support the Government of Odisha's vision to build the resilience of the agriculture sector to climate change, expand cultivable area under assured irrigation and improve water use efficiency," he added.

The US$ 165 million loan from the International Bank for Reconstruction and Development (IBRD), has a 6-year grace period, and a maturity of 24 years.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same. 


- INDUSTRY, MANUFACTURE 


11.1. Open to partnerships for JLR, but no plans to sell it: Chandrasekaran
Livemint, 16 Oct. 2019, Anurag Kotoky , Craig Trudell , Gabrielle Coppola , Bloomberg
  • JLR has waned to such an extent that it had to launch a $3.2 bn savings plan and slash jobs worldwide 
  • The chairman of Tata Sons says he wants operational control of JLR 
New York/New Delhi: Tata Sons Ltd, the owner of Jaguar Land Rover, said it is open to finding partners for the automaker, but isn’t planning on selling the embattled unit.

“We’re not going to sell," said Natarajan Chandrasekaran, chairman of Tata Sons, the holding company in an expansive business empire that includes Tata Motors Ltd. “Auto is a core business for us. From revenue terms, auto is our largest company."

Tata Motors bought the maker of the Jaguar XE sedan and Land Rover Discovery sport utility vehicle from Ford Motor Co. in 2008. After turning into a cash cow with booming sales in countries like Russia and China, JLR waned to such an extent that it has had to launch a $3.2 billion savings programme and slash thousands of jobs worldwide.

Losses at Tata’s automotive business have mounted with a slump in India’s car market, as well as trouble overseas, including an economic slowdown in China, where auto sales are sliding, and uncertainty over Brexit. JLR is closing its UK factories for a week in November to guard against disruption to supply chains from a possible no-deal Brexit.

Chandrasekaran said China sales have “collapsed" with a 50% drop last year, though 2019 is showing some improvement. Some problems were self-inflicted, including vehicle quality and dealer issues, he said, noting that the auto industry is “going through difficult times".

“Getting the right portfolio, which one we invest in for electric vehicles, and how do we cut cost" are issues that need to be resolved, he said.

In an interview with Bloomberg Television earlier on Tuesday, Chandrasekaran said dealing with tariffs is the “new normal" for the global auto industry and that negotiations around Britain’s exit from the European Union have taken too long. “Sometimes it’s better to have clarity than a desirable result," he said. “Nations are getting more protective."

The troubles of JLR are bogging down the Tata group as a whole, with Tata Motors writing down its investment in the British brands earlier this year by $3.9 billion. The salt-to-software conglomerate is among India’s most indebted, and the slump in the auto market is hitting both Tata Motors and Tata Steel. Analysts at Sanford C. Bernstein last month described JLR as “severely challenged" and said Tata Motors should look at BMW AG as a buyer because the German company is “awash with cash". Tata has previously denied reports it is looking at strategic options for JLR, including a possible stake sale.

While the company would “always look for partnerships", it doesn’t want deals where “we just sell a stake and we have no say", Chandrasekaran said in New York on Tuesday. “We are not financial investors, Tata group, we run companies. I’m not a Blackstone, I’m not a KKR."

JLR’s capital expenditure has outpaced operating cash flow over the past two years, but Chandrasekaran said his target is to reverse that trend by 2021. “Once we do that, then people will believe what I’m saying: I’m not running away."

This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.


11.2. 6 ways to reignite India’s auto industry
Livemint, 15 Oct 2019, Brajesh Chhibber , Rajat Dhawan
  • The automotive ecosystem can use these six proactive actions to hasten that much-needed turnaround in growth 
  • Market forces should decide between an internal combustion engine vehicle, a hybrid electric vehicle and a battery-electric vehicle 
What started as a small fire—a dip in sales volume of commercial vehicles in September 2018 immediately after the regulatory change in axle load norms —has turned into a full-blown conflagration in a year, engulfing at least five segments of the broader automotive industry in India. Commercial vehicles, passenger cars, two-wheelers, tractors, and construction equipment are down 15% to 40% in their monthly sales volume (year-on-year). It’s a slowdown so severe that it has led to inventory pile-up, stalled production lines, drying up of the supply chains, languishing dealership operations, postponed investments and hurtful job losses.

For the first time in several decades, all five of these broader automotive segments are seeing a concurrent downturn. There is little phase lag in the cyclical downswing across segments. The burden is on the forward and backward value chains, all at once. Second, the downswing amplitude in sales volume in a few segments has reached 30-40% this time around, against the earlier downswings of 10-15%.

While the commercial vehicles, tractors, and construction equipment segments are inherently cyclical—and after the robust sales growth years of 2015 through 2018, a cyclical correction was due, albeit not this deep—the segments of passenger cars and two-wheelers should not be demonstrating anything but secular growth, correlated to the rising income demographics of a large and advancing emerging economy.

So, what is the outlook for the coming year? When is the turnaround in growth likely to happen? Well, it depends on proactive actions that the industry ecosystem —the incumbent original equipment manufacturers (or vehicle makers), suppliers, dealers, financiers, shared mobility providers, government, and the industry associations —is willing to put in place. Here are six habits that high-growth sectors use to fuel their growth.

Don’t worsen the downswing

Business cycles are good in a free market economy, as they ensure the competitive firms thrive, and the excesses of poor investments are weeded out. It is the “cell repair" time, needed for a “healthy body". Yet, the industry ecosystem needs to work in unison to contain a free-fall when the down-cycle arrives.

Commercial vehicles, construction equipment, and tractors are strongly correlated to growth in GDP, industrial output, agricultural output, and infrastructure spending. A downturn in these automotive segments is reflective of the overall slowdown in the economy, with GDP growth rate coming down sequentially over last 5 quarters, from a high of ~8% in Q1, 2018 to ~5% in Q2, 2019.

A re-priming of these automotive segments will require significant focus back on the core sectors of the economy. Money and capital need to flow back into the infrastructure sector, particularly in settling contractor dues and re-oiling the supply chains. Investment projects, with new announcements having fallen by 79% in Q1 FY19 compared to the previous year, must pick up the pace again.

Likewise, a re-focus on the pricing of agriculture produce is called for so that farm mechanization trends stay accelerated as they have been for the last three years. Minimum support price (MSP) for agricultural produce, which have stagnated (e.g., MSP for rice has only risen by 3% in 2019 vs. an average raise of ~6% per year over previous 5 years), should ideally reflect the increase in input costs for farmers so that they are left with surplus to invest in mechanized equipment which increases their output and creates a virtuous cycle.

Don’t hurt demand enablers

Of all the sizeable emerging economies wishing to join the ranks of the developed world in the coming decades, India is perhaps the outlier country which would disproportionately depend on its domestic consumption for its GDP growth. Only the foolhardy could undermine its importance by throttling key enablers such as disposable income, easy credit availability, and product pricing.

The automotive sector is the bellwether of discretionary consumer spending, but it significantly depends on access to consumer credit. Here lies one of the major causes that precipitated the recent downturn. Credit crisis from high-capex industrial and real estate companies with overleveraged balance sheets has spilled over to NBFCs who are significant credit providers to the automotive sector across segments—fleet owners (commercial vehicles, construction equipment), farmers (tractors) as well as consumers (cars, two-wheelers).

Tightening of credit lines by NBFCs has been reflective in the significant cut down in loan disbursal, impacting sales volumes. The slowdown is also putting pressure on the MSME balance sheets of dealerships and smaller suppliers, which will aggravate the crisis, as these are funded by NBFCs too. The overall credit availability in the economy has to build back up, perhaps enabled by a faster clean-up of NBFCs’ and other financial institutions’ balance sheets in the interim.

Lower cost of credit through cheaper loans is another strong enabler. RBI has been softening the policy stance on rates over the last few quarters and has brought down policy repo rate to 5.4% at a time when inflation rates have also moderated. The real test is for financial institutions to pass on this real interest rate arbitrage to the buyers to enable the revival of demand.

The third enabler is putting more disposable income in the hands of consumers. Recently, a big step forward has been taken in the domain of direct taxation in the form of lowering the corporate tax rates. Is there an opportunity to look for a similar virtuous cycle on the personal taxation domain too to take the consumption sentiment to the next level?

Vehicle manufacturers can also innovate on providing new ownership models to buyers (e.g., fractional ownership, variable cost per ton per km rentals for fleet, and so forth) that reduces the upfront threshold for buyers and add to the positive momentum.

Never waste a downturn

Any downturn or crisis is the best time for players to create structural competitive differentiation in most sectors. This is the time to get leaner and efficient, invest in mid-term priorities at a time when the organization does not feel consumed to just meet the brimming market demand. The winners and losers are often separated during the times of downturn and crises.

In line with this, the current slowdown provides an opportunity for the automotive industry to undertake significant transformation and build a leaner and efficient industry. Tactically, they could rationalize their variant spreads and become more focused players in the market, optimize supply chain workflows by consolidating their supplier base, and imbibe new-age manufacturing.

Structurally, a strong re-look should be done at platform strategy to significantly bring down cost base through modularity of product design; a case in point being a leading car manufacturer of the country, who has more than 7 of its car models, and >60% of its sales volume on one platform. Can vehicle manufacturers cut the number of their vehicle platforms to half or even less, and gain benefits of much lower cost structure and much faster time-to-market with new products?

Digital and analytics (DnA) is transforming businesses, and the automotive sector should not be behind in embracing this transformational agent. The entire ecosystem should embed DnA in core processes to modernize them.

Bank on scale effects

This is the key learning from the China growth model. Keep the cost of production low, reflecting in optimal pricing and life cycle usage costs—which are supported by a moderate indirect taxation regime—that drives consumption up exponentially, thus creating scale effects in sector after sector to fuel rapid growth.

India is right now not on this path. Both India and China were similarly sized car markets in 2000 (0.6 vs 0.7 mn car sales per annum respectively). While China leapfrogged to ~23 mn car sales in 2018, India’s car market growth has been more gradual, reaching 3.3 mn car sales by 2018.

Some of the enablers for the China market has been lower taxes—VAT of 17% flat vs. 29-50% GST in India; 40% fuel taxes vs. 49% in India—and lower costs through lower real interest rates (2% vs. 5% in India).

In the automotive sector, scale-effects benefit the entire ecosystem across vehicle manufacturers, suppliers, dealers, consumers, and the government. Building scale would require moving towards lower taxes structure (e.g., optimal GST for the sector, simplified and lower taxation on fuel) and right cost structure through optimal vehicle specs and credit rates.

A significant contributor to scale could be a structural push towards exports. India has the potential to take the lead in exports in segments where we have an inherent advantage—2-wheelers, small cars, right-hand-drive vehicles. Already, approximately 15% of domestic production is exported, but this can be structurally pushed through with targeted incentives towards 30%.

A tech-agnostic regulation

Consumer is queen in most market segments. She is definitely so in the automotive sector, where consumer-choice almost always trumps any forced technology offerings. The consumer would weigh a complex set of buying factors in arriving at their buying decisions, comprising functional and economic criteria.

The implication is framing regulations in the sector, which should be from the point of view of outcomes (e.g., emission standards, fleet emission norms, safety requirements), and not to push one technology versus the other.

Let the market forces prevail to decide between an internal combustion engine (ICE, i.e., petrol, diesel, CNG fuelled) vehicle, a hybrid electric vehicle (HEV), or a battery-electric vehicle (BEV). Let consumers take a view based on their usage requirements and total cost of ownership (TCO). In the longer run, this will foster the right kind of innovation that matters to the consumers.

Competing technologies can co-exist under uniform regulation paradigm which best suit an individual’s needs and use case, e.g., in 2022, it will make complete commercial sense to run BEVs as taxis with daily usage of ~200 kms, while for a light user with daily use of 15-20 kms, a petrol/ CNG vehicle will be most economical. A push to this user to own and run an EV will have additional costs that have to be borne by someone in the ecosystem.

It is also important to maintain consistency of stance across industry participants. Confusing signals vitiates the consumer’s clarity and timing of what to buy, when to buy, leading to significant exacerbation of a downswing in demand. It also leads to false expectations in the consumer’s mind of the rewards of delaying their buying decision which may not accrue.

Prepare for roadblocks

The force of rising income demographics will create opportunities for the incumbents and the upstarts. India’s average incomes are rising by roughly 10%, the middle class will more than triple to ~100 million households by 2025, and, hence, the question should not be whether the growth will happen, but it should be how to enable the growth and prepare for it.

And it is not about choices—millennials vs others; shared mobility vs conventional mobility; BEV vs ICE—but about how to harness the power of the collective. The ecosystem should be solving a different set of questions. Are there different ownership models for millennials who have fewer proclivities towards vehicle ownership? How should shared mobility players be leveraged to increase the overall mobility market? How to leverage EVs for their real advantages?

The structural issues to solve are around a) adequate road density as peak-time traffic speed is starting to be grinding halt, b) enough alternative fuel availability, especially CNG, to not artificially create adoption barriers, c) sufficiently developed EV supply chain to support vehicle manufacturers’ electrification journey in India, and d) availability of sufficient and optimally-priced credit.

The automotive industry is at the cusp of creating the next ‘S’ curve in its evolutionary journey. And considering the positive benefits that the sector has on the overall economy, the full might of the industry ecosystem should now come behind the sector to support this upward inflexion in the trajectory.

Rajat Dhawan is a senior partner at McKinsey and Co., and leads the advanced industries practice across the Asia-Pacific region; Brajesh Chhibber is an associate partner at McKinsey and Co. Both are based in Delhi.


12.1. Not Mahindra or Tata, Hyundai Kona is the EV of choice for govt
Livemint, 21 Oct 2019, Utpal Bhaskar, Malyaban Ghosh
  • Preference for Kona is despite its price being almost double that of Tata Motors’ Tigor and M&M’s Verito EVs 
  • 'Kona’s battery size is almost three times that of Tigor and Verito; running cost is just 40 paisa/km,' says EESL MD Saurabh Kumar 
New Delhi: The Union government has placed initial orders with Hyundai Motor Co. for the Kona electric compact sport-utility vehicle.

This comes as the government’s largest electric vehicle (EV) procurement programme, run by state-owned Energy Efficiency Services Ltd (EESL), faces bottlenecks because of issues such as vehicle quality and a lack of demand, according to several government officials.

Power and new and renewable energy minister Raj Kumar Singh, and NTPC chairman and managing director Gurdeep Singh have started using the Kona, which went on sale in July. Top officials at policy think tank NITI Aayog too are keen to use the vehicle.

The preference for the Kona is despite the vehicle’s price tag of ₹23.71 lakh post government subsidies, which is about double that of Tata Motors Ltd’s Tigor and Mahindra and Mahindra Ltd’s e-Verito electric sedans.

The Kona can travel up to 452km on a single charge and has a 39.2 kilowatt hour (kWh) advanced lithium polymer battery. The Tigor and e-Verito have less than 20kWh batteries.

“Kona’s battery size is almost three times that of these other cars (Tigor and e-Verito). The running cost is just 40 paisa/km. It’s a brilliant car in terms of comfort and this is the beauty of EVs anyway," said EESL MD Saurabh Kumar.

Only 500 Tigors have been supplied by Tata Motors to EESL so far, while M&M has delivered 1,000 e-Veritos. This was in response to the two companies receiving orders from EESL in September 2017 for 10,000 cars. While 60% of the sedans were to be supplied by Tata Motors, the rest were to come from M&M.

EESL now plans to limit the final order to around 3,000 cars by March 2020 amid an economic slowdown.

Mint reported on 27 June, 2018 that senior government officials were refusing to use EVs made by M&M and Tata Motors, citing poor performance and low mileage.

The problems with the Tigor included issues related to AC cooling, pick-up, sudden battery discharge and inability to charge. These were resolved after a delay, according to EESL.

Miffed with the quality of Tigor cars, EESL in a 10 April 2018 note to the automaker reviewed by Mint said: “It has been observed that Tata Motors is not taking any sincere steps to resolve these issues, causing delay and leading to customer dissatisfaction."

“The performance of Tata Motors is found to be below par and EESL will not accept delivery of any new vehicle till all the issues with the existing cars have been rectified," it said.

Tata Motors has denied that there are quality issues with the EVs. A company spokesperson said in an emailed response: “After getting the LoA (letter of award) from EESL, we have completed the phase 1 deliveries in line with the technical specifications of the tender."

Queries emailed to spokespersons of EESL, M&M, power ministry and Hyundai Motor India Ltd remained unanswered till press time.


12.2. Chinese auto firms eye GM’s last plant in India
Livemint, 10 Nov 2019, Malyaban Ghosh
  • SAIC, Great Wall Motors in talks with GM to buy its Talegaon factory in Maharashtra 
  • SAIC and Great Wall are looking at new markets for expansion, given that China has reached saturation point 
New Delhi: SAIC Motor Corp. Ltd and Great Wall Motors Co. Ltd, two of China’s biggest automakers, are in talks with General Motors Co. to acquire the Detroit carmaker’s last remaining factory in India, two people aware of the development said.

Located at Talegaon in Maharashtra, the plant can produce 165,000 vehicles a year and 160,000 power trains. GM had in 2017 sold its first factory in India at Halol in Gujarat to SAIC. MG Motor India, a unit of SAIC, has tasted runaway success with its debut Hector sport utility vehicle (SUV) since it went on sale in June.

This has likely prompted SAIC to eye GM’s second factory as MG has outlined an ambitious product introduction plan for the Indian market. MG plans to introduce its second product in India, an electric SUV, next month.

Great Wall, China’s biggest SUV maker, is actively scouting for land or existing factories in India to start operations.

SAIC and Great Wall are looking at new markets for expansion, including India, given that China has reached saturation point, one of the two people cited above said on condition of anonymity.

“MG Motor has a capacity of just 80,000 units in the Gujarat plant which is not adequate if they get three decent products in India," the person said. Great Wall has also initiated negotiations with the Maharashtra government for a potential purchase of the plant in Talegaon, the person added. “The company, though, is also looking at other options across the country to set up its first manufacturing plant in India."

GM stopped selling vehicles in India in early 2017, using the Talegaon plant to export its Chevrolet Beat hatchback primarily to Latin America. It could not completely shut its India operations as it failed to find a buyer for the second plant.


Both companies, especially Great Wall, are looking to acquire factories instead of setting up a greenfield facility, which generally takes a couple of years, the second person said, also requesting anonymity. The Talegaon plant, therefore, offers a good option.

“Also, the plant is a recent one and is situated close to the port. Great Wall is actively looking for options in the Indian market and GM has been looking for a buyer to sell this plant for quite some time. After the deal with JSW fell through, this provides GM a fresh opportunity to shut shop in India," the person said. The discussions between Great Wall and GM have reached an advanced stage, while they are at a preliminary level with SAIC, the person added.

Sajjan Jindal-led JSW Energy was in advanced talks with GM to buy the Talegaon plant, but the deal faltered after JSW decided to suspend plans to develop electric vehicles.

Responding to Mint’s queries, a spokesperson for GM India said, “As we have said previously, we are exploring strategic options for the site."

Meanwhile, to reduce its already scant presence in the Indian market, GM, on 16 September, announced an agreement with Tata Consultancy Services Ltd, wherein the country’s largest software exporter will acquire certain assets of GM’s technical centre in Bengaluru, besides absorbing 1,300 employees.

Puneet Gupta, associate director of vehicle forecasting at IHS Markit, said weak automobile demand in India and idle capacities offer a great opportunity for new entrants looking to invest in India. “This way, they will be able to minimize their investment and fast-forward the launch of their products in the Indian market," he added.

Great Wall is expected to enter the Indian market with its Haval brand of SUVs.

Queries sent to MG Motor India and Great Wall Motors on 6 November, remained unanswered till press time.


13.1. Opinion | A policy agenda to meet India’s steep employment challenges
Livemint, 28 Oct. 2019, V. Anantha Nageswaran, Gulzar Natarajan

We must enable small businesses to grow since these hold the greatest potential for job creation

As India battles an economic slowdown and myriad other associated problems, attention is bound to be deflected from the ever-present priority of job creation for the country’s youth bulge. There was cheerful news from India’s factories sector in the recently released Annual Survey of Industries for 2017-18.

Job creation in the sector has been steady, if not spectacular. The number of workers employed grew 4.8% in 2017-18. Total people engaged (including managers) rose 4.7%, the highest in four years. Promising as this is, the sheer magnitude of job creation required for young Indians to enjoy a life of dignity means that millions of them must become job providers rather than swell the ranks of job-seekers.

In the years after independence, India’s traditional industrial policy was built around three pillars—concessional credit, fiscal incentives and input subsidies. However, a growing body of research has upended this conventional wisdom and shown that the predominant source of job creation is firms that start small and formal, and eventually grow into medium-scale enterprises. In doing so, they reveal an alternative path to generating productive jobs in India. This is not to overlook the value of large firms, but only to highlight the disproportionate importance of startups in job creation. Some of the findings are particularly relevant.

One, although micro businesses dominate most countries’ economies, India’s economy has an excessive proportion of less productive, informal micro businesses. Two, employment in India is concentrated in these micro businesses, whereas in developed countries, it is concentrated in formal small and medium-sized firms. Three, productive jobs are created by firms that start out as formal. Four, new and young firms create more jobs than older, established firms. Five, growing and efficient firms are founded and run by educated entrepreneurs. Six, with age, Indian firms typically stagnate or decline in employment. Seven, India has a deficit of productive, job-creating entrepreneurs, and an excess of informal entrepreneurs focused on survival.

These findings suggest that government policies on micro, small and medium enterprises (MSMEs) must become more nuanced. Informal micro enterprises and single-person enterprises run by those lacking formal education should be termed “subsistence enterprises". The government would then be under an obligation to support them with basic public goods, including education and a robust social safety net. Educating the next generation is critical to breaking the iron grip of poverty and pulling single-person enterprises out of survival mode. However, support to these subsistence enterprises should be provided under anti-poverty measures and not under an economic development programme (much less under productive job-creation measures).

In general, the government’s perception of entrepreneurship as a viable solution to the lack of employment options is well-founded. International evidence is supportive of this: Startups and young firms create more jobs regardless of their size, and educated entrepreneurs have a far higher probability of success. Therefore, public policy to support entrepreneurship and MSMEs should target these entrepreneurs. However, any government support should be made contingent on the enterprise’s progress in creating jobs and productive growth, thereby encouraging truly dynamic entrepreneurship.

To enhance the productivity of businesses and promote growth, the government should subsidise the provision of management support services—as industrial public goods—to young businesses. A nascent initiative in South Tamil Nadu shows that huge productivity gains are waiting to be unlocked in small businesses if entrepreneurs are made to understand the importance of some critical principles and concepts related to finance and human resources. Moreover, as education plays a big role in the growth of startups and their contribution to employment generation, institutions of higher learning should prepare students to be entrepreneurs in the same way that they equip them with functional, marketable skills.

The government should also periodically update the definitions of MSMEs to bring them closer to international standards. This will help ensure that businesses are not prematurely labelled as large and are not denied government support while still in need of it.

Finally, internalising the most important principle of public policy—if you cannot help, at least do not hurt—is the first thing the government can do to support entrepreneurs. It is a lot easier for governments to impede economic activity than to foster it. The difficulty in arresting and reversing the current narrative of an economic slide is a case in point. Just avoiding doing the wrong thing will obviate the need for the government to support the economy actively later. In other words, not getting in the way may be the most important policy intervention that any government anywhere could undertake.

This piece is based on the authors’ working paper, ‘India’s quest for jobs—a policy agenda’, published by Carnegie India earlier this month

V. Anantha Nageswaran and Gulzar Natarajan are co-authors of ‘The Rise of Finance: Causes, Consequences and Cures’


13.2. Mahindra to acquire 100 per cent stake in Peugeot Motocycles to explore new markets
IBEF, Oct. 29, 2019

To drive the future growth in European markets and to expand into new geographies including select Asian markets, "Mahindra Two Wheelers Europe" the subsidiary of Mahindra and Mahindra, will acquire 100 per cent of ownership of Peugeot Motorcycles (PMTC).

This plan is supported by a robust investment plan which includes the introduction of seven new products by 2021. The presence of brands in Europe will be fortified with France remaining a major market and PMTC's headquarters continuing to be based at Mandeure.

In 2015, 51 per cent equity stake in PMTC from Groupe PSA had acquired by Mahindra Two Wheelers.

As per the Mr. Rajesh Jejurikar, President of FES & Two Wheelers and Member of the Group Executive Board at Mahindra & Mahindra, "We are seeing positive momentum at Peugeot Motocycles". He also added, "Kisbee becoming the largest selling 50cc vehicle in Europe, Peugeot Metropolis getting stronger in Europe and China, the positive market response to the new launch of the Urban GT connected Pulsion, are all cases in point. We fully support PMTC's Performance 2020 and look forward to the future with enhanced optimism". 

The Peugeot brand will continue to be used in the future under the trade license agreement between PMTC and Peugeot. In addition, the Peugeot design teams will continue to assist in the design and development of PMTC products in close cooperation with the PMTC management and the Mahindra Group.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.


14.1. PepsiCo India wins US award for saving more than 17 billion litres of water
IBEF, Nov. 01, 2019

US Secretary of State, Mr. Mike Pompeo presented the prestigious Award for Corporate Excellence to PepsiCo India in order to acknowledge the efforts of the company, as it saved more than 17 billion of litres of water through community water programs that has a positive impact on thousands of community members.

The ACE was Established in 1999 and recognizes those US companies that act as a responsible member of their communities where they do business and maintain those high standards.

"Today we honour one of PepsiCo's regional arms, PepsiCo India. It is India's largest purchaser of potatoes. And it uses this to power good, sourcing sustainably from 24,000 small Indian farmers. It also has a program aimed at replenishing water in stressed areas, through which it has restored nearly five billion litres of water", said Mr. Pompeo.

Chambers Federation in the Democratic Republic of the Congo, Procter and Gamble Asia Pacific in Singapore and Agilis Partners in Uganda were the other recipients of the award.

Mr. Pompeo added, "Our four winners today demonstrate the power of free enterprise. They demonstrate to our foreign partners that working with our businesses is a path to prosperity and stability."

According to him, these companies highlights the America's free market values by producing good jobs in the United States and around the world, investing sustainably, operating transparently, and providing the highest quality products and services in the world.

PepsiCo India won globally for its sustainable operations in the multinational enterprise category for its sustainable farming initiative in India.

The company has worked with community water programs in order to save more than 17 billion litres of water and also replenishing over 5 billion litres of water, affecting positively around 60,000 community members.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.


14.2. Why India needs deep tech startups
Livemint, 28 Oct. 2019, Leslie D'Monte, Meera Vankipuram

India's startup ecosystem has produced 27 unicorns but none are in the deep tech domain. Is the country losing out?

BENGALURU: A little over two years back, Hemanth Satyanarayana, founder and chief executive of a Hyderabad-based mixed reality startup called Imaginate, wowed audiences when he provided a sneak peek into how people would interact and conduct business in the future -- via virtual teleportation. He used an augmented reality (AR) headset to chat with a virtual 'avatar' of his colleague who was physically present in another room.

Since then, Imaginate has only improved the technology and believes it will eventually change the way we do video conferencing. "We now enable cross-device communication over virtual reality and augmented reality (the combination is popularly known as mixed reality) wearables for better enterprise collaboration in the industrial sector. This is a leap ahead from today’s video conferencing experience," insists Satyanarayana.

Another technology startup, Bengaluru-based Gnani.ai, is focused on speech recognition and natural language processing (NLP) in multiple Indian languages. "Our goal is to bridge the digital divide in India using voice--the most natural form of communication. We use the core technology to develop multilingual voice bots and speech analytics in multiple channels such as web, apps or even on telephone lines," says Ganesh Gopalan, co-founder of the startup that is funded by Samsung Ventures.

Tech industry body Nasscom points out that there are hundreds of such technology startups that can be defined as "deep tech-based" companies. According to Milind Hanchinmani, Lead-DeepTech Club at Nasscom, "Over the past five years, India has witnessed the emergence of over 1,200 deep tech startups and the adoption of advanced tech is rapidly increasing at a 50% YoY growth."

Of the estimated 7,500-odd technology startups, Nasscom defines these deep tech-based companies as those that have been "consistently working towards driving innovation in new age technologies such as AI, IoT (internet of things), Blockchain, Machine Learning, Cybersecurity, Augmented and Virtual Reality, among others".

Digital transformation

India desperately needs these deep tech startups in order to take digital transformation to the next level, argue experts. Current digital technologies such as mobile, cloud, and customer relationship management (CRM) tools added functional capabilities such as connectivity, storage, and computing power in the digital transformation journey of any organisation and its processes, according to Jayanth Kolla, founder and partner of a deep tech research and advisory firm, Convergence Catalyst.

"However, emerging deep technologies, including Advanced Analytics, AI/ML, IoT (internet of things), and Blockchain, will add a layer of intelligence to a company’s systems," he adds. According to Kolla, these technologies work in the background to make systems "smart, intuitive, self-reliant, customised and most importantly, continuously improving, which is the next level of digital transformation--the so-called digital transformation 2.0".

For instance, CogniCor Technologies helps enterprises, primarily financial services organisations, from across the globe to build a cognitive interface powered using an AI platform. "It can read and understand enterprise knowledge and engage various stakeholders in goal-based conversations", according to Sindhu Joseph, chief executive and co-founder of the Delaware-registered startup that has operations in Kochi.

Similarly, Bengaluru-based Coeo Labs makes medical devices that assist newborns and infants in breathing and prevent ventilator-related infections. According to Nitesh Kumar Jangir, co-founder of the Bengaluru-based startup, "Any patient who is on ventilator has around 25-30% chances of acquiring a deadly infection called Ventilator-associated pneumonia (VAP). More than 250,000 people in India die every year because of this infection."

Jangir points out that while such patients are administered antibiotics, this also increases antimicrobial resistance, which will be the next big problem in healthcare. To address the issue, Coeo Labs has built a technology that can prevent this infection, which Coeo Labs has christened VAPCare. According to Jangir, Coeo Labs has already been granted patents in countries like the US, India, and China. "Our product is already USFDA approved. And this device uses high-end cutting-edge material science, sensor technology, and data analytics," he adds.

Funding a challenge

According to Jangir, deep tech is those areas where you do cutting edge research in all kinds of technologies, not just software or AI, but it also involves doing cutting-edge research in material sciences or in bio-technology. "These are not the things that are driven by lucrative business models or normal IT business models but these are technologies that have high IP (intellectual property) capability, and have real contributions to knowledge and science itself," he insists.

Deep tech startups, according to Joseph of CogniCor, are on the rise globally. She points out, though, that India lags a behind on this front since most of the startups are from the US, Greater China, Taiwan and Japan. She believes that India needs to create a more robust deep tech startup ecosystem and deep tech talent pool. The work done by the likes of Nasscom in creating the ecosystem is noteworthy.

"However, unlike Silicon valley, the home grown VCs are kind of reluctant when it comes to funding deep tech startups. The lack of funding can be a huge impediment," says Joseph.

She has a point. The Indian startup ecosystem has produced 27 unicorns till date but none are from the deep tech domain. In terms of a total startup funding in Indian startups since 2014, the highest grossing sectors are e-commerce ($13.59 billion), fintech ($8.14 billion), and consumer services ($4.74 billion), according to Inc42 DataLabs research. According to a 3 May report by Inc42 DataLabs, the deep tech sector recorded a mere $9.58 million in investment in the first quarter of 2019 as compared to the $958 million investment in e-commerce, $697 million in fintech, and $212 million in consumer services.

According to Kashyap Kompella, a technology industry analyst and CEO of rpa2ai Research, there are now an increasing number of deep tech startups in healthcare and pharma which are traditionally research and development (R&D) intensive industries. He cites the examples of Bengaluru-based Achira Labs (a technology platform for immunodiagnostics) and RichCore Life Sciences (that makes animal-origin free proteins and enzymes). He cautions, however, that "in the field of AI software, where the deep tech label is being liberally applied these days, one must take those claims with a pinch of salt".

The challenges for deep tech companies include "shortage of talent and fierce competition for available talent," he said. "India is a STEM-rich country at the bachelor’s level but STEM-poor at the PhD level." He adds that deep tech companies have a longer lifecycle before they can scale and become commercial successes, hence will need “patient capitalists" -- venture capitalists whose horizon is longer than traditional VCs and who better understand the technology commercialization models and filter startups for investments based on their IP assets.

Manish Singhal, Founding Partner of pi Ventures says his firm looks at deep tech as "any business which is enabled by a technology that has inherent IP in it". According to him, they come in two broad categories – one is digital deep tech and one is beyond digital deep tech. In the digital deep tech, all the technologies that are fundamentally innovating in the digital domain come under it.

“AI comes in that – companies like Sigtuple, Niramai. These are all digital deep tech. In the beyond digital deep tech, a lot of innovation in India is happening in various things like life sciences. A company called Pandorum has developed an artificial cornea in the lab," notes Singhal.

He points out that while it has never been easier to launch a start-up in India, there are still numerous challenges. "Two people get together and get some funding and start but all these deep tech companies typically have a slightly longer incubation time to become a business. Then, there is a funding paucity after they have gotten started to take them to a business of commercial value. That funding ecosystem is coming together slowly and we are doing our bit it in it," Singhal says.

Siddharth Pai, founder and managing partner of Siana Capital, defines deep tech as technology that can change things at a fundamental level, either through new knowledge-based expert systems or the ability to take existing knowledge to develop a technology solution rather than wait for AI to figure it out.

The other area is hardware or firmware-related, according to Pai. “In so far as tech sitting on a hardware platform, the definition is a bit broad -- medical devices, other calibration systems, new operating software for mobiles going into the large catchment area of 500 million Indians coming online."

Other than these, true advancements in engineering, physics, exact sciences, and mechanics that have the ability to be quickly translated into a workable product or technology platform for wide use also fit into the deep tech definition, says Pai. He adds that in hardware, chip design would also fit under deep tech due to the capital intensive nature, but is better suited to private equity investment firms with rounds of large capital infusion.

Pai acknowledges that deep tech doesn’t represent low hanging fruit like a food delivery or a real estate app, where there is already a lot of venture capital money chasing deals. "Deep tech and deep science are under-served segments. The gestation period is long. In deep science, drug discovery, for example, takes 8 or 10 years, sometimes longer. There is higher risk for a long period of time. The lack of private money in this space is a challenge. The ability to build critical mass for the country is difficult. I don't think we have established in the popular imagination that such differentiated science can come out of India," he says.

Road ahead

Will these evolving deep tech companies eventually be acquired by large technology companies? For instance, Whatsapp and Instagram were acquired by Facebook, while DeepMind is now a Google company."

The founders of Deep Tech startups are a tenacious lot. Not only have they toiled in the lab to get a patent or two but are actively engaged in taking their inventions to market. Even if all of them do not succeed eventually, they are attractive to larger and more established companies. That’s why we see a lot of future “acqui-hires", says Kompella.

According to Satyanarayan of Imaginate, typically deep tech startups around the globe will get acquired by large companies if they do not have a "good follow-on series of funding". He points out, thought, that in India, large technology companies do not seem to acquire deep tech startups "as much as I think they should". This is because of the general tendency of “build rather than buy" in the Indian tech market which is still famous for outsourced or cheaper software development".

Joseph of Cognicor, on her part, believes that only a handful will be able to grow into deep tech unicorns, since it is easier for big companies to acquire a deep tech startup rather than trying to develop the technology on their own. Adit Chhabra, chief executive of the New Delhi-based AI-startup Wobot, corroborates that "consolidation in an industry is a natural outcome. It might be faster in deep tech because of deep pockets of the large players, both money wise and data wise".

This March, for instance, Reliance Industries Ltd. (RIL) entered into agreements to acquire three startups--language localisation technology platform Reverie Language Technologies, software-as-a-service startup Easygov, and software simulation services company SankhyaSutra Labs. Similarly, global technology companies like Google, Microsoft, SAP Labs, Accenture Ventures, Oracle, and Facebook continuously engage with deep tech startups in India.

Jangir believes that India needs the Flipkarts and Olas of the world of deep tech. “Right now, there is no one. More than deep tech, we need someone who has become a unicorn by selling hardware. We don't have companies selling hardware," he says.

According to Hanchinmani of Nasscom, as India’s public and private sector increasingly focuses on adopting next generation technologies, the demand for advanced deep tech and AI-related technologies will witness enormous growth domestically, thus creating an opportunity for start-ups and tech players to provide innovative products and services.

He concludes, though, that prowess in deep tech and AI will require focused attention and mentorship from the industry, academia, and the government.


15.1. Microsoft set to invest $200  mn in Ola, boost connected car tie-up
Livemint, 29 Oct. 2019, Salman S.H.
  • Microsoft will acquire a stake of around 4.5% in Ola’s parent company, ANI Technologies, as part of the deal 
  • The connected car project, which began in 2017, aims to connect cars with Internet of Things sensors, and the transmitted data is stored in the cloud 
BENGALURU: Ride-hailing company Ola is set to unveil a connected car project in partnership with Microsoft Corp., which will also invest around $200 million in Ola’s parent, ANI Technologies Pvt. Ltd, two people aware of the deal said.

Microsoft will acquire around 4.5% in ANI Technologies as part of the deal, one of the two people said on condition of anonymity. News agency PTI first reported the fundraise on Tuesday.

The project, which began in 2017, aims to connect cars with Internet of Things sensors, and the transmitted data is stored in the cloud. The car is thus tracked not only for its location through GPS, but also for the quality of its engine and for relaying information needed by vehicle insurers.

The project will showcase software and hardware solutions addressing the emerging mobility segment, said the person cited above.

Bengaluru-based Ola did not respond to an email seeking comment, while a Microsoft spokeswoman said the company has “nothing to share" on the development.

“The (Ola-Microsoft) partnership will include cloud solutions, a connected vehicles product and deep-tech capabilities focused on future mobility solutions. The tech will also have direct implications for Ola Electric," the person added.

Ola Electric Mobility Pvt. Ltd is the electric vehicle (EV) unit spun off from ANI Technologies.

Ola’s proposed connected vehicles project is an “extension" of the initial tie-up with Microsoft, the second person said. In 2017, Ola said it would become a connected car solutions supplier to auto companies worldwide. As part of the partnership, Microsoft would become the default cloud service provider to Ola, wherein the cab-hailing platform would also use Microsoft Azure for Ola Play, the ride-hailing company’s in-cab video streaming service.

Ola’s effort to break into mobility tech solutions is also seen as a response to Uber, which is developing its own fleet of electric vehicles, along with a self-drive car project.

“If Ola has to build large-scale connected cars data, then it will either require electric vehicles on the road or technology such as IoT in existing fleets," the first person said. “Ola will have to compete with companies like Uber, which is already building partnerships with EV manufacturers."


15.2. Total buys 37.4 per cent stake in Adani Gas for Rs 5,662 crore
IBEF, Oct. 14, 2019

French oil and gas giant Total S.A. has acquired a 37.4 per cent stake in Adani Gas Ltd, the listed gas unit of the diversified Adani Group, for Rs. 5,662 crore (US$ 0.81 billion) as the company is relying on India’s shift towards a gas-based economy to address climate change concerns by using cleaner and greener fuels.

The deal delivers TOTAL joint control of Adani Gas. In India’s city gas distribution (CGD) sector, the acquisition is the largest Foreign Direct Investment (FDI).

In Adani Gas, 37.4 per cent shares was purchased by World’s Second-Largest LNG company “TOTAL” through a tender which offer to public shareholders to acquire up to 25.2 per cent shares subject to the applicable regulations also to purchase the residual shares from Adani Group.

On Friday, closing price of Rs. 137.65 a share, deal drives of about Rs. 5,662 crore (US$ 0.81 billion).

As part of the acquisition, Total will bring its LNG and retail expertise and also supply up to 3 mt of LNG to Adani Gas. Total and Adani will also establish a joint venture to market LNG in India and Bangladesh.

As per the gas partnership with Adani, in 2019-20, net acquisition cost for TOTAL is about US$ 600 million by considering the sale of its 26 per cent stake in LNG regasification terminal which is located at Hazira in Gujrat in 2019.

Patrick PouyannĂ©, Chairman and CEO of TOTAL said, “This partnership with Adani is cornerstone to our development strategy in this country”. “Energy needs in India are immense and the Indian energy mix is key to the climate change challenge. Firmly investing to develop the use of natural gas in India is in line with Total’s ambition to become the responsible energy major. The natural gas market in India will have a strong growth and is an attractive outlet for the world's second-largest LNG player that Total has become”, he added.

As per the September 2019 presentation on ‘Strategy and Outlook’ deal is a part of TOTAL’s plan to deliver growth by investing US$ 18 billion between the year 2019-2023, mostly through higher LNG sale of 50 million tonnes.

Gautam Adani, Chairman, Adani Group, said, “Total’s investment in Adani Gas reinforces India’s natural gas and demand potential,” also added the statement “The partnership will derive significant synergies between Adani’s capabilities of developing world-class assets and Total’s global best practices as well as leveraging business synergies across LNG, fuel retail and city gas distribution”.

TOTAL said in presentation that by 2015, it intends to open around 4,000 service station in new markets out of which 1,000 would be in India.

City Gas Distribution is a natural extension of the plans of both partners to invest in infrastructure and assets worth over US$1 billion, which span Liquefied Natural Gas (LNG) infrastructure and marketing and fuel retail business, announced in October 2018.

To develop India’s gas infrastructure, distribution and marketing business, TOTAL and Adani would make an investment in next 10 years with the presence in over 15 states reaching out to 7.5 per cent of India’s population also setting up global-scale LNG, Gas distribution in India.
TOTAL and Adani will target to build a fuel retail network on the main road of country with the 1,500 retail stations in coming years.

After China and US, India is the world’s second largest energy market also the growing one with the 5 per cent of growth rate.

Government has drew the plans to double the share of Natural Gas with India’s overall energy mix from 6.2 per cent to 15 per cent by 2030 which are determined by abundant supply , competitive pricing, infrastructure expansion and regulatory initiatives to tackle severe emission norms and meet global climate change obligations.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.


- SERVICES (Education, Healthcare, IT, R&D, Tourism, etc.) 


16.1. India's service excellence to be showcased in GES 2019
IBEF, Nov. 11, 2019

With an aim to engage industry and Governments across the world and to promote greater exchange of trade in services between India and rest of the world, Department of Commerce, Ministry of Commerce and Industry in association with Services Export Promotion Council (SEPC) and Confederation of Indian Industry (CII) has created a dedicated platform, the Global Exhibition on Services (GES) which is an annual event.

The 5th edition of GES 2019 is being held from 26-28 November 2019 in Bengaluru, Karnataka. It is an attempt towards escalating the Indian services bar in the global arena by exploring 12 Champion Services Sectors, encompassing participation from 100 countries and hosting sector specific knowledge sessions. India is looking to attract investments and partnerships in strategic areas like aviation and space programme, infrastructure, telecom projects, financial management and accounting, content, design, media distribution and outsourcing publishing work, Intellectual Property management services and environmental/ social impact assessment.

Through GES the Government of India seeks to enhance strategic cooperation and develop synergies to strengthen multilateral relationships between all stake holders, tap the potential for services exports and increase FDI inflow.

GES 2019 will host focussed knowledge sessions on key Champion Services Sectors and will cater to many B2B, B2G and B2C meetings.

In GES 2019 SEPC is also looking to promote eSports. The eSports industry is expected to grow rapidly and in 2017 worldwide revenue generated in eSports market amounted to US$ 655 million. The market is expected to generate close to USD 1.8 billion in revenue by 2022. The regular monthly salaries of average pro-gamers may range from US$ 1000 to USD 5000 apart from the money that they win from prizes. There were 270 million global fans of eSports in 2016 and the number is expected to grow to 495 million in 2020. For GES 2019 India has invited eSports federations from several countries. Participants are expected from Indonesia, Vietnam, Nepal, Sri Lanka, Japan, Maldives, Saudi Arabia, New Zealand, Australia, South Africa and Korea.

SEPC is organizing Nations Cup (International eSports Championship) in association with Electronic Sports Federation of India (ESFI) during GES 2019. The Nations Cup will be one of the key highlights during GES and will open multiple avenues for the services industry particularly in eSports, gaming and animation.

The Nations Cup will have two legs, day one will have the India Qualifiers and day two onwards eight eSports teams from different National eSports Federations representing respective countries will compete for the Nations Cup. Winner of India Qualifiers will represent India at the Nations Cup. The winning country's eSports team will take home the Nations Cup trophy.

An International Moot Court competition is also being organized during GES 2019 for young lawyers, who along with their seniors, will argue cases related to intellectual property rights. In this competition participants from BIMSTEC (Bangladesh, India, Myanmar, Sri Lanka, Thailand, Nepal and Bhutan) and CLMV (Cambodia, Laos, Myanmar and Vietnam) countries are expected.

Foreign delegates from 100 countries and participants from 15 states of India are expected in GES 2019. India is also aspiring to promote niche tourism like the Buddhist circuit, adventure and camping tourism. Uttar Pradesh is the partnering state mainly to promote the tourism sector and will have a separate state pavilion in GES 2019.

In order to attract more players in the services sector India has liberalized its e-visa regime in three categories: e-tourist, e-medical and e-business to promote these sectors. Multiple entry tourist and business visas for a period of five years are now available to nationals of all countries for the benefit of medical tourists. Separate immigration counters and facilitation desks have been provided at six Indian international airports of Delhi, Mumbai, Kolkata, Chennai, Bengaluru and Hyderabad.

Government of India through Directorate General of Foreign Trade (DGFT), Department of Commerce has been endeavoring to develop exports by incentivizing the service exporters through the Service Exports from India Scheme (SEIS) which is an incentive scheme introduced in the Foreign Trade Policy (FTP) 2015-2020. Under SEIS incentives to services exporters during the FY 2018-19 stood at Rs. 4262.80 crore (US$ 609.93 million). Rewards under SEIS are provided in the form of Duty Credit Scrips, valid for 24 months from the date of issue, that can be used for payment of basic and additional customs duty on goods imported and the Duty Credit Scrips are freely transferable. Therefore, if the exporter cannot use the Duty Credit Scrip they can be sold in open market. GST rate for transfer/ sale of scrips has been reduced to 0 from 12 per cent.

SEPC is an export promotion council set up by Ministry of Commerce and Industry, Government of India in 2006 as an apex trade body to facilitate service exporters of India. SEPC actively contributes to the formulation of policies of Government of India and acts as an interface between the services industry and the Government. It has a membership base of 4800 members from the 14 service sectors.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.


16.2. Software products are booming: TCS COO
IBEF, Oct. 14, 2019

India’s largest IT service company, Tata Consultancy Services Ltd. (TCS), is planning to become the country’s largest software product company by following a new way for itself, as the revenues of the company have already passed the billion-dollar-mark.

Digitate, a TCS unit which was created three years back, is a pure-play software products company, having its own HR rules, start-up culture, and different pay scales. Digitate will be soon reaching the targeted US$ 100 million revenue mark. The other software products of the company already generate over a billion dollars in revenues, as per TCS’ Chief Operating Officer, Mr. NG Subramaniam.

Mr. Subramaniam added that overall products business of the company is way above billion dollars already, and in coming future the company could, even list some of these product units on the stock exchange as independent firms.

“We have multiple products companies and our intent is to keep them within TCS. If an opportunity comes to list them separately, we will. But right now, we are building products and services to be a strong services company that also has products,” said Subramaniam.

The chunk of revenues apart from Digitate comes from TCS BaNCS, according to Subramaniam. Digitate is one of the fastest growing pure-play software products in the world.

Mr. Subramaniam added, “Our BFSI platforms is big business right now... TCS BanCs today has close to 500 clients that run their day-to-day core operations on our platform”. In the last few years, the company has focused its investment in three Ps — products, platforms and patents. These Ps help in future proofing the services business along with allowing TCS to create new capabilities that can be sold at much higher margins.

By September 30, 2019, the company has been granted 1,121 patents out of the 4,874 patents that were applied. 192 patents were applied during the first quarter of FY20. The granted patents are mostly for software products. The benchmark set for the products businesses is much higher when it comes to margins, according to Mr. Subramaniam. The investments that comes into the company are aimed at bringing in higher margins along with the ability to offer unique capabilities.

Mr. Subramaniam further added, “Digitate is a strategic unit; TCS Financial Services that runs TCS BanCS is a separate business unit, and TCS BFSI platform is a separate business unit. We call them strategic growth businesses. We have kept them separate because fundamentally they work differently from services. Pure-play services business remains separate.”

Digitate has only one commercial product, named Ignio, which is a cognitive automation tool that competes with the likes of IBM Watson. TCS other software products include digital learning tool TCS iON, TCS Algo Retail, focused product for retailers; and TCS BaNCS, which is the largest product so far, having a core banking software product suite. TCS is also making use of other channel partners to increase the growth of the products business, starting with selling Ignio.

“So far we had been selling Digitate through our own internal sales team and integrated Ignio into our solutions.

“Now we have taken a conscious decision to appoint channel partners to accelerate sales. We have started onboarding partners in the last two quarters. In this quarter, we onboarded three more partners,” said Subramaniam.

“Opportunity for us is to make, for example, TCS Financial Services a pure products company and outsource implementation to the services team (within TCS) as a systems integrator,” said Subramaniam. In order to avoid any conflict of interest with clients, TCS is keeping the software products divisions completely away from the services unit.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same. 


17.1. Given rock-bottom expectations, Wipro’s Q2 show will be cheered
Livemint, 16 Oct. 2019, Mobis Philipose
  • Wipro reports a steady revenue growth after a sequential decline in Q1 revenues 
  • Net profit was higher than expectations on better operating margins and a drop in tax rates 
Blessed is he who expects nothing, for he shall never be disappointed," said the English poet Alexander Pope.

Investors in Wipro Ltd will not only be not disappointed, they will be quite pleased with the company’s September quarter results.

While revenue growth was more or less in line with what analysts expected, at 1.1% sequentially in constant currency terms, profit margins were better than expected.

What’s more, there was a surprise drop in the effective tax rate in the second quarter of fiscal year 2020, and the company now expects an effective tax rate of about 20-21% on an annual basis. This is lower than analysts’ estimates of a 22-23% effective tax rate for FY20 and FY21. As a result, earnings estimates are expected to be upgraded by analysts.

Wipro expects its tax rates to drop as a result of the government’s cut in minimum alternate tax rates. This sets it apart from other software services companies who have decided to stay with the previous tax regime, and hence won’t see an increase in earnings estimates as a result of the government’s tax cut.

This comes against the backdrop of a massive underperformance by Wipro shares in the past six months. While the Nifty IT index fell by 5.6% during this period, the company’s shares have slumped by 15.3%. Wipro’s shares were trading at only around 13 times FY21 estimated earnings, far lower than the more than 20 times valuation in the case of Tata Consultancy Services Ltd (TCS). “Given the rock-bottom expectations from the company, its performance will be cheered by investors," says an analyst at a domestic institutional brokerage firm, on condition of anonymity.


Note that Wipro’s revenue had fallen by 0.7% in the June quarter, after which its stock posted losses vis-Ă -vis peers.

But while the Q2 show looks decent against the backdrop of the weak Q1 performance and generally low expectations, there are still concerns about growth. Year-on-year growth stood at merely 3.8% in Q2. Adjusted for the contribution from acquisitions, the sequential revenue guidance for Q3 is only 0-2%.

Revenue from the banking and financial services vertical fell sequentially, which is a worry for prospects for growth going forward. Besides, the steady operating profit margins in Q2 were aided by some one-off factors that may not repeat going forward.

As such, investors would do well to not extrapolate the earnings in Q2 as a sign of things to come. Wipro’s year-on-year growth rates remain far lower than those of peers, and a large differential in valuations compared to large peers such as TCS and Infosys Ltd looks justified.

But as pointed out earlier, the fact that things improved compared to the June quarter, and considering the surprise bump in earnings owing to the tax change, the valuation gap can be expected to narrow a bit.


17.2. Glenmark Pharma gets USFDA nod for prostate cancer treatment drug
IBEF, Oct. 18, 2019

Glenmark Pharmaceuticals, a drug firm said it has received final approval for Abiraterone Acetate tablets from the US health regulator. These tablets are used in treatment of prostate cancer. The approved product is a generic version of Zytiga tablets, 250 mg, of Janssen Biotech.

According to the company in its regulatory filing, "Glenmark Pharmaceuticals Inc., USA has been granted final approval by the United States Food & Drug Administration (USFDA) for Abiraterone Acetate tablets USP, 250 mg."

As per the sales data by IQVIA for the 12-month period that ended in August 2019, Glenmark said that the Zytiga tablets, 250 mg market has achieved an annual sale of approximately US$ 794.1 million.

Currently, Glenmark's portfolio has 162 products authorised for distribution in the US marketplace and 46 ANDA's pending approval with the USFDA.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.


18.1. AYUSH Minister inaugurated Ayurveda Palliative Care Unit at base Hospital
IBEF, Oct. 22, 2019

Minister of State (Independent Charge) for AYUSH and Defence Shri Shripad Yesso Naik today inaugurated Ayurveda Palliative Care Unit at Palliative Care Centre, base Hospital, Delhi Cantt, New Delhi. On this occasion, a Memorandum of Understanding (MoU) was also signed between Ministry of AYUSH and Ministry of Defence for the Integration of AYUSH under the health establishments of Directorate General of Armed Forces Medical Services (DGAFMS).

In his inaugural address, the Minister said that our Army soldiers work in very challenging environmental conditions right from Glaciers of Siachin to the Desserts of Thar, which takes a toll on their physical as well as mental health. He said that Ayurveda and Yoga can help the soldiers of Indian army to attain the best of physical and mental health and can improve their endurance. Shri Naik further informed that Ayurveda medicines and Panchkarma procedures like Snehana and Swedana are very effective in treating the Work-Related Musculoskeletal Disorders (WRMSDs).

Secretary AYUSH Vaidya Rajesh Kotecha and Director General of Armed Forces Medical Services Lt. General Bipin Puri were also present on this occasion.

Under the MoU Ayurveda Units will also be established at Palliative Care Centre, Army Research and Referral Hospital, Air Force Hospital, Hindon, Ghaziabad and Five identified Ex- Service men Contributory Health Scheme (ECHS) Polyclinics in Delhi - NCR.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same. 


18.2. Aurobindo Pharma gets USFDA nod for Guaifenesin generic
IBEF, Oct. 25, 2019

Aurobindo Pharma Limited has received final approval from the US Food & Drug Administration (USFDA) for production of Guaifenesin extended-release tablets.
According to a release, Aurobindo's Guaifenesin which is an extended-release tablets is the AB rated generic version that is equivalent of RB Health (US) LLC's Mucinex tablets. This is expected to be launched launch in Q4FY20.

These tablets will aid in loosening the phlegm (mucus), and thin bronchial secretions to clear the bronchial passageways of inconvenient mucus and make coughs more productive. According to IRI database, the approved product has an estimated market size of US$ 301 million for the twelve months ending July 2019.

This is the 10th ANDA (including 1 tentative approval) approved out of Unit X formulation facility in Naidupet, Andhra Pradesh, India used for manufacturing oral products. After this approval from USFDA, Aurobindo now has a total of 419 ANDA approvals (392 Final approvals including 21 from Aurolife Pharma LLC and 27 tentative approvals).

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.


19.1. Guidelines released for evaluation of nano-pharmaceuticals in India
IBEF, Oct. 25, 2019

The Union Minister for Science & Technology, Earth Sciences and Health & Family Welfare, Dr. Harsh Vardhan released "Guidelines for Evaluation of Nano pharmaceuticals in India", at an event in New Delhi today.

Dr. Harsh Vardhan informed that these "Guidelines for Evaluation of Nano pharmaceuticals in India" is one of the most important steps for delineating quality, safety and efficacy assessment of the novel nano formulations. He further added that these guidelines are intended to provide transparent, consistent and predictable regulatory pathways for nano pharmaceuticals in India.

Nanocarrier based targeted drug delivery is an emerging field with introduction of nano pharmaceuticals in the market. These nano formulations have higher efficacy, lower toxicity and are safer than the conventional drugs. Indian researchers would be facilitated to undertake research in line with the regulatory guidelines and is expected that Industry would be keen to participate from the beginning of the research pipeline towards product development and commercialisation. Further, private investments would also be attracted since these guidelines would strengthen the regulatory system.

The guidelines apply to the nano pharmaceuticals in the form of finished formulation as well as Active Pharmaceutical Ingredient (API) of a new molecule or an already approved molecule with altered nanoscale dimensions, properties or phenomenon associated with the application of nanotechnology intended to be used for treatment, in vivo diagnosis, mitigation, cure or prevention of diseases and disorders in humans.

The guidelines would facilitate translational research in line with the regulatory requirements. Guidelines will also facilitate the decision making by regulator during clearances to newer products based on nanotechnology and similarly to researchers to get clearance for their products to launch in market. End users will also be benefited by the quality assured anticipated products in the market in accordance to the guidelines.

This document will give impetus to initiate activities for developing safety guidelines for other domains like agri-inputs and agri-products, cosmetics, implantable devices, through interventions of nanotechnology.

The guidelines will pave the way for significant benefits through such cutting-edge technology and contribute to the mission on "Affordable Health Care for All".

The Guidelines are developed by Department of Biotechnology (DBT), Ministry of Science and Technology, Indian Council of Medical Research (ICMR) and Central Drugs Standard Control Organization (CDSCO), Ministry of Health and Family Welfare and is an outcome of all concerned Inter-Ministerial efforts coordinated by DBT.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.


19.2. Why HCL Technologies’ stock fared better than its larger peers
Livemint, 24 Oct. 2019, R. Sree Ram
  • The company now expects its organic business to grow in double digits, at 10-11%, against 8-10% estimated earlier 
  • Deal flows have improved significantly compared with the June quarter 
The September quarter earnings reinforced investors’ faith in the HCL Technologies Ltd stock. The stock gained 2.2% on Thursday, widening its recent outperformance against larger peers Tata Consultancy Services Ltd and Infosys Ltd.

Constant currency revenues jumped 20.5% as HCL Tech began integrating acquisition of select IBM products. On a sequential basis, revenue grew 6%. Much of the sequential growth was driven by the integration of IBM products. Even so, a 14% expansion in organic revenue from a year ago is nothing to sneeze at.

More importantly, the upgrade in annual revenue growth guidance underscores the improvement in its core business. The company now expects its organic business to grow in double digits, at 10-11%, against 8-10% estimated earlier.

In constant currency terms, the full-year revenue growth guidance has been raised by one percentage point. “This revision in guidance comes on the back of acceleration in organic growth momentum in H1, robust deal wins, and order book," analysts at SBICAP Securities Ltd said in a note.


Deal flows have improved significantly compared with the June quarter. The company signed 15 transformational deals. Overall caution in the financial services industry notwithstanding, HCL Tech has a good deal pipeline in Europe. Four of the seven business verticals clocked double-digit revenue growth in Q2.

The newly formed products and platforms division (HCL Software) had a good start, clocking $100 million in revenue. Created after integrating IBM products, it has access to 20,000 customers across the globe. The management expects the enhanced reach to aid business momentum.

Operating profit margin jumped to a multi-quarter high of 20% in Q2. Margins were boosted by lower amortization expenses and full recognition of revenues from IBM products, expenses of which were partly booked in earlier quarters.

Predictably, investors cheered the results. How well HCL Tech is able to narrow the valuation gap with peers depends on its ability to scale up the products business and revenue momentum. “HCL Software’s (products unit) ability to successfully convert IBM customers into its own fold over the next few quarters will be the key for further re-rating," said analysts at Centrum Institutional Research.


20.1. IndiGo places mega order for 300 Airbus jets
Livemint, 29 Oct. 2019, Rhik Kundu
  • The IndiGo order, worth more than $30 billion at list prices, is Airbus’s largest from a single airline 
  • The long-range, fuel-efficient planes will boost IndiGo’s plans to expand its international network 
New Delhi: InterGlobe Aviation Ltd, the operator of India’s largest airline, said on Tuesday it has placed an order for 300 Airbus A320neo family aircraft worth more than $30 billion at list prices.

This is Airbus’s largest aircraft order from a single airline and will take IndiGo’s total number of narrow-body A320neo family aircraft orders to 730, the Indian company said. IndiGo’s latest order includes the new A321XLR long-range planes that can travel as far as 4,700 nautical miles (nm), or 8,700km, without refuelling.

The long-range, fuel-efficient planes will boost IndiGo’s plans to expand its international network. The A321XLR, which has the longest range for a single-aisle aircraft, will be delivered to customers only after 2023.

“The A321XLR is the next evolutionary step from the A321LR," IndiGo said. “The aircraft will deliver an unprecedented extra long range of up to 4,700nm, with 30% lower fuel burn per seat compared with previous generation competitor jets."

IndiGo currently flies to foreign destinations such as Myanmar, Vietnam, Saudi Arabia, China, Kuwait, the Maldives, Bangladesh, Thailand and the UAE.

“The fuel-efficient A320neo family aircraft will allow IndiGo to maintain its strong focus on lowering operating costs with high standards of reliability," said Riyaz Peermohamed, chief aircraft acquisition and financing officer of IndiGo.

The firm order will also allow IndiGo to replace its older A320ceo fleet by 2022. As of 30 September, the Gurugram-based airline had 245 aircraft in its fleet, consisting of 89 A320neo planes, 129 A320ceo planes, six A321neo planes and 21 ATR aircraft. It has since added an A321neo plane to its fleet.

The airline will choose the engine manufacturer for this order later. A320neo family planes come with two engine choices—Pratt and Whitney and the LEAP engine of CFM International, a joint venture of GE Aviation and Safran Aircraft Engines.

“The order is an important milestone as it reiterates our mission of strengthening air connectivity in India, which will in turn boost economic growth and mobility," said IndiGo CEO Ronojoy Dutta.


20.2. Vistara to order 26 CFM engines worth $2.4 bn for 13 new Airbus A320 Neos
IBEF, Oct. 18, 2019

Vistara has decided to place $2.4 billion worth of orders for 26 CFM-manufactured Leap-1A engines to power its 13 new Airbus A320 Neos, which also includes a maintenance contract.

Vistara stated that "The 13 A320 Neos are in addition to the 37 leased A320 family of Neos that the Tata-Singapore Airlines-run Vistara had ordered from Airbus in July 2018" along with the statement, the first of its 13 deliveries are expecting to be delivered by end of the month.

Out of 32 planes10 are the A320 Neo planes in Vistara fleet.

Vistara chief executive, Leslie Thng said, "We are extending our partnership with CFM International and select the Leap-1A engines for our new aircraft"
In May 2017, New-Delhi based airline took delivery of the first leap-1A Airbus A320 Neo and currently operated 10 leads planes.

For the maintenance of 120 Leap-1A engines, Vistara has signed a long-term rate per flight hour agreement, which will power its 60 Airbus planes in service or on order.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.



INDIA AND THE WORLD


21.1. Hunger, starvation and Indian soldiers in World War II
Livemint, 08 Nov. 2019, Diya Gupta
  • On the 80th anniversary of the start the war, we need to look beyond a narrative glorifying it as a fight against fascism 
  • Understanding the Bengal famine of 1943 as a product of World War II is crucial to its legacy 
An Indian havildar, or junior officer, who was part of a Sappers and Miners unit stationed in Egypt during the height of World War II, wrote back home in June 1943: “From my personal experience I can tell you that the food we get here is much better than that we soldiers get in India. But whenever I sit for my meals, a dreadful picture of the appalling Indian food problem passes through my mind, leaving a cloudy sediment on the walls of my heart which makes me nauseous and often I leave my meals untouched."

The soldier identified with this imagined community of sufferers in his homeland through his own body, as the pain of distant hunger reached out, resulting in him being heartsick and unable to eat. Another havildar clerk, writing to relatives, related his feelings of helplessness to the extraordinary conditions of the Indian wartime marketplace: “I am terribly sorry to learn about the food situation in India and it seems as if there is no salvation for me.… What is the use of money when we are unable to obtain the necessities of life in exchange for it? The situation would drive even the most level-headed of us to madness and when we think of conditions in India we become crazy as lunatics."

Yet another sepoy, also from the Middle Eastern and North African theatres of war, declared in 1943 that his colonial war service was no longer doing him any economic good. “You write to me so often that things have become very expensive and you ask me to send you more money and more money. Where can I get money? Why doesn’t your land which supplied us all before all this produce enough for you to eat something?" he complained to his family. “I know what mistake I have committed. But it is too late. It was better if we had all worked on the land, at least we would have lived as before. Now I cannot earn even enough grain to last you two months."

These letters are from military censorship reports archived at the India Office Records at the British Library, UK. Nausea, helplessness, madness and despair—Indian accounts from World War II convey a spectrum of emotional responses to global conflict and its atrocities that claimed over 60 million lives, and changed the face of geopolitics across the world. In 2019, in the 80th anniversary year of the start of this war and with Remembrance Sunday services being held on 10 November, it is more important than ever that we move beyond American and Eurocentric frames of reference. We need to make space in our public memory for the forgotten voices from the former British empire, and continue to uncover its complicated afterlives. Understanding the Bengal famine of 1943 as a product of World War II is one such legacy.

What happened in Bengal—and other parts of India, such as the princely state of Travancore in south India—in 1943? As Nobel Prize-winning economist Amartya Sen’s Poverty And Famines—An Essay On Entitlement And Deprivation (1981) argues, the famine was manufactured and not natural. Later research has confirmed that those people whose lives were already financially precarious starved because they couldn’t afford to buy food rather than there being an overall shortage of its supply. Historians have compared food prices in wartime Britain to those in India, and found that prices were controlled by government subsidies in Britain and rose by 18%, whereas here the price of even rationed food during the 1940s rose by an extraordinary 300%. It is this lack of price control which became a crucial factor leading to famine. More recently, Madhusree Mukerjee has shown, in Churchill’s Secret War (2011), that it was the colonial government’s agricultural, economic and export decisions, informed by war priorities, that resulted in death from starvation and the associated diseases of cholera, diarrhoea and dysentery in Bengal.

War and hunger, then, remained inextricably connected as violence spilled over from international battlefronts to claim civilian lives on the home front. Indian soldiers who were killed or injured in World War II numbered around 90,000; the famine claimed over three million victims.

Letters written by Indian soldiers during the war tell us that although the men themselves were far removed from hunger and were well looked after by the colonial authorities, they empathized and commiserated with one another’s familial misfortunes. A havildar clerk wrote home to west India, a region that was also experiencing food shortages, although to a lesser degree: “(A)s you say, that it is difficult, dear, and grain is unobtainable. But look at these people in Bengal. Their situation is ten times worse than our home district. There are many Bengalies (sic) in the army here with me, and when they get their letters from home, they seem to be very worried and by their appearance, I guess that the public in Bengal is suffering badly. Many times they have shown me their letters and when I read their sufferings, it breaks my heart."

Extracts from letters composed from the heart of hunger in Bengal survive today. But many of the writers were unable to formulate words to describe the enormity of witnessing the famine. A doctor in the wartime Indian Medical Service received a letter from his home in Bengal that simply said, “The plight of our country is beyond description." Another letter, addressed to a captain in the Indian Medical Service, asked: “What will happen if the war lasts longer? Can you imagine?"

These writings by soldiers and their loved ones at home reveal that there was no homogenous Indian war experience. The letters become evocative fragments, testament to a complex range of emotions that cannot be contained within the narrow prisms of “heroism" and “sacrifice" with which we are made to remember this war today. More than wreaths and monuments, it is these narratives—letters, diaries, memoirs, even novels and poetry—that bring the range and depth of such experiences alive. Remembering Indian involvement in this anniversary year through soldiers’ and civilians’ letters means that we recognize how colonial participation complicates the story of the “good war" that was World War II. It was not simply a fight against fascism, but one where imperialism of all hues was implicated.

Diya Gupta’s doctoral research, from King’s College London in 2019, is a literary and cultural examination of Indian experiences in World War II.


21.2. Opinion | Angela Merkel’s inclusive and firm leadership shall be missed
Livemint, 13 Nov. 2019, Chitra Subramaniam

Mutti, or mother, as Germans call her, exemplifies qualities that could inspire many a leader

Mutti, Germans call her, an endearing term for “mother", with all the warmth, kindness and inclination to occasionally use the metaphorical stick. When she speaks, the world listens.

Angela Merkel, the first woman to become the chancellor of Germany in 2005, will not seek re-election in 2021. In a week when the world is looking at history to commemorate the fall of the Berlin Wall, her name figures right up there along with the world’s greats. Without pomp, and even less pageantry, whether at glitzy events like the annual World Economic Forum at Davos or the closed conclaves of the Group of Seven, and even in smaller settings like bilateral meetings with some of the world’s most powerful leaders—she was recently in India—Merkel has never let herself become the story.

Her priority has been Germany and Europe, and building a strong European foreign policy. In a world that is badly in need of healing and mending, even her worst critics cannot find any fault with her, other than to say that she’s too inclusive.

Born in Hamburg, West Germany, Merkel moved to East Germany as a child with her family. She has a doctorate in quantum chemistry and worked as a research scientist, entering politics only after the fall of the Berlin Wall in 1989. She was elected to the German Bundestag and rose in politics as the protĂ©gĂ© of chancellor Helmut Kohl. Merkel held several political positions till she was elected secretary general of her party, the Christian Democratic Union (CDU), before becoming its first female leader. In October 2018, Merkel said she would not seek re-election as the CDU’s, nor as Germany’s chancellor the year after next.

One area where Merkel’s voice is already being missed is the current tensions in the North Atlantic Treaty Organization (Nato), the post-war grouping of the Allies. French President Emmanuel Macron recently said there’s a brain drain within, and that Nato’s head—Norway’s Jens Stoltenberg—is a lightweight. Relations between Europe and the US have never been as acrimonious as they are now, and US President Donald Trump appears to be fishing in troubled waters from across the pond.

Merkel exemplifies a range of leadership qualities, from rigorous resilience and fair-play to humanity and hard work, all rolled in one. These are qualities that European Union (EU) leaders can take lessons from—especially at a time when Europe is in search of an identity that would enable it to preserve its differences and diversity without having to sacrifice much-needed economic growth.

Germans are Europe’s most productive people (they work the least number of hours, much to the envy of the French), and, at a little over 80 million, they carry the industrial gravitas of China, which is over a billion strong. Merkel was the first to lead a trade delegation to China, followed by France.

The German work ethic, of which Merkel is a complete reflection, is not a fairy tale. It is a reality that comes from self respect and respect for one’s country. It’s a sentiment that is nurtured by the country’s education system and instilled in its workforce, be it in dealing with its current economic issues—infrastructure, for example—or pulling back from a heavy dependence on coal.

Merkel has just announced an ambitious environmental programme. A Lutheran who has studied Marxism and Leninism, she is no evangelist of any “ism" other than pragmatism and humanism. Her kind of rigorous compassion is a combination of skill and experience that few leaders have. Among the Europeans who have displayed such capacity was probably the French visionary Jacques Delors, who knit socialist policies with market forces to draw the grand lines of the European common market as it began to take shape.

Two recent instances where Merkel bit the bullet show her vision and quest for a democratic middle ground. One was when she hit the ground running and saved the EU from doddering after the Greek financial crisis a decade ago. The other was her decision to take over a million Syrians fleeing war and poverty some years ago. “We can do this," she told her nation. The salient message to the world, especially to those across the pond, was this: You cannot ceaselessly bomb a people and expect them not to run to safety. Dislocation has never been a natural choice for human beings, and it has not got any better in a world where people want more and more, and where there’s less and less of everything, except instruments of war and nervous leaders.

“History will prove her right," the European Commission’s president Jean-Claude Junker had told Germany’s mass circulation daily, Bild, and that “…if she had closed the German borders, Austria and Hungary would have collapsed due to the high number of refugees."

When Merkel said, “we can do this", apropos Syrian refugees, she wasn’t looking for applause. European prosperity is the direct result of the absence of war and a difficult relationship with Russia (with which west European countries share borders) that few non-Europeans comprehend.

Perhaps the one time she gave any emotion away without words was during a photo-op, when Trump invited her to stand next to him in the first row while she preferred to stay in the second rung. Cameras caught her gently rolling her eyes after the US president had turned his back. Non-committal, yet determined in her own way—that’s Angela Merkel.

Chitra Subramaniam is an award-winning journalist and author.


22.1. Protectionism should worry India
Livemint, 12 Nov. 2019, Nikita Kwatra

Among large economies, the US and India have imposed the most trade restrictions in the past three years to promote domestic manufacturing, data shows

India’s last-minute withdrawal from signing the Regional Comprehensive Economic Partnership (RCEP) treaty has reignited the debate on the trade policy and protectionism in Asia’s third largest economy. How far RCEP would benefit or harm the country remains a matter of debate. But what is beyond debate is India’s rising protectionism, which can end up hurting both consumers and industry over the long run.

Data from the Global Trade Alert (GTA) database shows that over the past three years, among the largest economies comprising the G-20 group, India is only second behind Donald Trump-led US in imposing restrictions on trade.

The GTA database is a trade policy monitoring initiative by Simon Evenett and Johannes Fritz, economists with the University of St. Gallen, Switzerland. The database attempts to record all unilateral actions by governments, including those by public institutions such as the central bank, which affect trade. The countries affected by each such action are identified on the basis of existing trade patterns between the countries concerned.

Even as it sharply criticized rising protectionism in the US under the Trump administration, India itself raised tariff walls in the last two budgets, ostensibly to promote domestic manufacturing. These moves reversed a long-held policy of liberalizing tariff rates which India had followed since 1991. Such unilateral restrictions on trade affect all economies, and arguably isolate India more than the decision to opt out of any one trade deal. Expensive imports after all make even our exports costlier since much of what we export is based on imported inputs. They also hurt consumer interests since consumers end up paying higher prices.

Such decisions also end up hurting Indian industry on three counts. First, tariff increases in any one industry (say, steel or electronics components) can hurt other firms in another industry (say auto-makers and electronics assemblers). Second, such tariff walls erode the competitiveness of domestic firms over the long run and raise the ‘cost’ of entering any trade pact, such as RCEP, since the gap between India’s tariff rates and those of others remain wide. Finally, such unilateral tariff walls end up inviting retribution from trading partners.

And the GTA data does show that has faced a backlash, especially from the advanced G-20 economies. Among the largest economies in the G-20 group, China and India have been hit the hardest by protectionist measures of advanced G-20 economies in the last three years. The emerging G-20 economies have, however, been less harsh on India so far.

But this could change if calls to raise tariff walls against other emerging markets, particularly China, materializes. Concerns about India’s rising trade deficit with RCEP members, particularly China, led to India’s withdrawal from the proposed pact. And such concerns have also led to calls for policies to stem the flow of imports from these economies, particularly Chinese imports.

But any such move could end up being counter-productive for the reasons discussed above, benefiting a few domestic firms, but hurting others. A recent Indian Institute of Foreign Trade (IIFT) working paper authored by Sunitha Raju and V Raveendra Saradhi suggests that concerns about imports from China may be misplaced.

They show that between 2007-08 and 2015-16, growth in imports from China was associated with growth in gross value added (GVA) and output across Indian industries. Of the 26 major industries selected for the analysis, GVA declined for only three industries—steam generators, iron and steel, and games and toys. Categorizing Chinese imports into capital, intermediate and consumer goods, the authors found that imports of intermediate goods boosted output the most (growth of 163%), followed by capital goods imports (93%) and consumer goods imports (73%). Thus, the authors argue that imports of intermediate and capital goods from China have the greatest effect on the manufacturing sector.

Competition from Chinese imports also improved overall industry efficiency by forcing out inefficient firms and allowing efficient firms to increase their market share, the researchers show. In particular, this has helped boost the chemicals and pharmaceuticals sector with both sectors improving their export performance.

India’s lurch towards protectionism has also meant that India’s integration in global value chains (GVCs) has suffered in recent years. Between 2007 and 2017, GVC participation rate for most developing countries declined, a recent World Bank report shows. But the decline for India has been sharper than for others.

It is worth noting that India’s export performance has been lacklustre since then. India’s share in global merchandise exports has stagnated in the 1.6%-1.7% range since 2013 even as India’s GVC links with other economies has come down.

It is worth noting that during India’s export boom in the 2004-09 period, when share of merchandise exports rose nearly half a percentage point to 1.3% of global trade, India’s integration in GVC networks had also risen.

More generally, India’s export growth and overall GDP growth rate in the post-liberalization era has been far higher than it was during the long period of protectionism that preceded it. Higher protectionism does not seem to have brought any sizeable benefits for the country whereas greater integration did benefit the economy as a whole.

India can realize its ambitions of becoming the next factory of the world only if it opens up its economy and adopts fair and predictable trade rules. India’s policymakers must refuse to give in to protectionist lobbies, and instead force domestic firms across industries to become globally competitive if they want to see India grow rapidly.


22.2. India signs MoU with Saudi Arabia to launch RuPay card in Gulf Kingdom
IBEF, Oct. 30, 2019

To launch the RuPay Card in county, India signed an agreement with Saudi Arabia on Tuesday making it 3rd nation in the West Asia to initiate the India's digital payment system which will benefit not only the 2.6 million Indians in Gulf Kingdom but also in Haj and Umrah Pilgrims.

RuPay Card is the first-of-its-kind Indian Domestic Debit and Credit Card payment network and also accepted at ATMs, POS device and on e-commerce websites.
RuPay Card is introduced in 2012 to achieve the vision of Reserve Bank of India i.e. to have a domestic, open and multilateral system of payments.
As India has already launched RuPay Card in UAE, Bahrain, Singapore and Bhutan.

During Prime Minister Narendra Modi's visit, an MoU was signed to launch the RuPay cards in Saudi Arabia, said a joint statement issued at the end of his visit.

In Saudi Arabia, over 2.6 million Indians are working, which is the largest expatriate community in the country. Every year around 2 hundred thousand Haj pilgrims and over 3 hundred thousand Umrah pilgrims visit to Saudi Arabia from India and the acceptance of RuPay Card allow them to transact at cheaper rates.

RuPay is a highly secure network that protects against cyberhacks and is India's version of Master Card and Visa.

Currently, in India, there are around 500 million RuPay Cards in circulation.

To enhance its international acceptance RuPay has tied-up with international players like Discover, Japan Credit Bureau and China Union Pay. It has also achieved a milestone of issuing 25 million RuPay Cards.

India's relations with Saudi Arabia have been on an upswing over the last few years based on burgeoning energy ties besides cooperation in several other areas. Prime Minister Modi's first visit to Riyadh in 2016 put bilateral ties on a new trajectory.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.


23.1. NPCI expects UPI user base to expand to 500 million in next 3 years
IBEF, Oct. 30, 2019

The user base of real-time payment system Unified Payments Interface (UPI) expected to expand fivefold to 500 million in the next three years according to National Payments Corp. of India (NPCI), chief executive officer Mr. Dilip Asbe said.

Mr. Asbe added, "UPI has recently crossed 100 million users, making it one of the fastest adoptions of any payments system anywhere in the world. NPCI's objective for the next three years is to expand the UPI user base to 500 million." NPCI had developed UPI, which is supported by the Reserve Bank of India.

UPI transactions have achieved a new record of approximately 1 billion in October, though the official data for details of payments transaction in terms of value and volume is expected to be released on November 1. Transactions recorded in the month of September stood at around 955.02 million of worth Rs 1.61 trillion (US$ 23.04 billion), as against 93,000 transactions worth Rs 3.1 crore (US$ 0.44 million) when it was launched three years ago in August 2016.

According to Mr. Asbe, "It is encouraging to witness digital payments being widely accepted across the country. UPI's integration with third-party apps and bank support has provided impetus to P2P (peer-to-peer) as well as P2M (person-to- merchant) electronic payments which resulted in this momentous achievement". It is expected that in the next two years, the merchant ecosystem will get digitized with the number of QR codes set to treble to 30 million.

The success of UPI among the people is because of its simple, safe and hassle-free system. It allows the users to transfer money any time across multiple bank accounts, without needing the details of the beneficiary's bank account.

The real-time payment system Unified Payments Interface's (UPI's) user base is expected to expand five times in the next three years to 500 million, this comes when the government is actively giving boost to the digital payments in the country, NPCI chief executive officer Mr. Dilip Asbe said.

This payment platform was developed by Reserve Bank of India (RBI) backed NPCI and has also given other digital payment modes such as wallets, debit cards, credit cards, run for their money.

NPCI also plans to further take UPI network globally, based on the recommendations of the Nandan Nilekani-headed panel report on 'deepening of digital payments'.
"We expect collaboration between fintechs and banks to drive the acceptance abroad. Our focus will always remain on enhancing acceptance infrastructure for digital payments so as to encourage customers towards digital transactions to achieve RBI and government's less cash objective and facilitate faster adoption of UPI," he said.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.


23.2. UN paints food waste picture
Americafruit, 14 Oct. 2019, Liam O’Callaghan

A new report has provided an updated understanding of the world’s food waste problem allowing for more effective action

The Food and Agriculture Organisation (FAO) of the United Nations has released a new report providing insight into how much food is lost - as well as where and why - at different stages of the food supply chain.

According to the State of Food and Agriculture 2019 report, these understandings will help to achieve progress towards the important target of reducing food loss and waste.

The report stated around 14 per cent of the world's food is lost after harvesting and before reaching the retail level, including through on-farm activities, storage and transportation.

However, the food losses vary considerably from one region to another within the same commodity groups and supply chain stages.

The report highlights the need and offers a new methodology, to measure carefully losses at each stage in the food supply chain to help identify critical loss points across the supply chain.

Evidence presented in the report shows losses and waste are generally higher for fruits and vegetables at all stages in the food supply chain.

In lower-income countries, more fresh fruit and vegetable loss is attributed to poor infrastructure than in industrialised countries

Despite the fact that in most high-income countries, adequate storage facilities, including refrigerated warehouses, are available throughout the supply chain, losses do occur during storage, the report said.

This is generally because of a technical breakdown, poor management of temperature, humidity or overstocking.

Qu Dongyu, director-general of FAO, said effectively reducing food waste can only be achieved if there is a solid understanding of the problem.

“Three dimensions need to be considered. Firstly, we need to know – as accurately as possible – how much food is lost and wasted, as well as where and why,” Qu said.

“Secondly, we need to be clear about our underlying reasons or objectives for reducing food loss and waste. Thirdly, we need to understand how food loss and waste, as well as the measures to reduce it, affect the objectives being pursued,” he added.

“This report sheds light on these three dimensions in order to help design more informed and better policies for food loss and waste reduction.”


24.1. Amazon launches 'Project Zero' in India to block counterfeit goods
IBEF, Nov. 13, 2019

Amazon announced its "Project Zero" to be introduced in India, in order to ensure that customers receive authentic goods when shopping on Amazon. This project offers additional proactive mechanisms and powerful tools to identify, block and remove counterfeits.

Over 7,000 brands have already enrolled in Project Zero across US, Europe and Japan. Several Indian brands also took part in a pilot to support the company in order to test the experience in India.

"With this launch, we're excited to see many more brands in India, from small and emerging entrepreneurs to large multi-national brands, partner with us to drive counterfeits to zero and deliver a great shopping experience for our customers," Mr. Dharmesh M Mehta, Amazon's vice president of worldwide customer trust and partner support, said in a statement.

Amazon's advanced technology and innovation is combined with the modern knowledge that brands have regarding their own intellectual property and the ways to detect counterfeits of their products.

The three tools used in the process include Automated protections, self-service counterfeit removal tool and product serialization.

"Project Zero builds on our long-standing work and investments to ensure that customers always receive authentic goods when shopping on Amazon," said Mr. Mehta.

Hindustan Unilever added in its feedback of the test run that the tool has brought relief to brand owners and works in a seamless manner.

Unique code enables the oroduct serialisation that brands use within their manufacturing and packaging process, and this allows Amazon to individually scan and confirm the authenticity of every single purchase of a brand's enrolled products through Amazon's marketplace.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.



24.2. The shrinking of India’s middle class
Livemint, 31 Oct. 2019, Rahul Jacob
  • Elements that propelled growth and widened India’s middle class are losing momentum. This should worry us all 
  • Stunting of the middle class is the result of decades-long inability to make India a manufacturing hub for multinationals. Also, note-ban and GST have driven thousands of small firms out of business 
When men make do with frayed innerwear garments, economists worry. Alan Greenspan, the former US Federal Reserve chairman, used declining innerwear sales, The New York Times reminded us last month, as an indicator of an impending slowdown because it suggests consumers are cutting back spending sharply.

For stalwarts of India’s innerwear industry, the new normal of decelerating growth is already a couple of years old.

“It’s been a sustained slowdown since demonetization, which got worse after GST," says Sanjay Jain, managing director of TT Ltd, which makes vests priced at ₹60 to ₹100 and underwear that starts at ₹80. The Federation of Hosiery Manufacturers’ Association of India says sales have fallen by 25% this year. Jain, an alumnus of the Indian Institute of Management in Ahmedabad, adds, “Every time we see a lift, it’s not sustainable. We are not seeing any encouraging signs."

In India, where millions have only in the past decade or two clambered onto the bottom rungs of the consumption ladder, buying more than food and basic clothing, the trend to cut back on replacing innerwear is troubling. Lately, consumers have been cutting back on many things, from biscuits and soap to jewellery and cars. Pronab Sen, India’s former chief statistician, argues, “Over time, if there is stagnation in upward movement (in income distribution)… you’re stuck. The market for corporates becomes limited. Hope is not lost yet, but time is running out."

From the Reserve Bank to Hindustan Unilever, the assumption is that the downturn is cyclical, but something much more profound than millennials opting not to own cars is unfolding: India’s middle class could be permanently stunted.

It is already a small middle class, variously estimated to be 1% to 20% of the population. Its ownership of computers and washing machines is tiny as a percentage of the total population compared to its cohorts elsewhere.

Deja vu, 1992

I played a small part in what quickly became a national sport of exaggerating the size of India’s middle class. In the first magazine cover story published in the US in 1992 on India’s economic reforms, I quoted a National Council of Applied Economic Research (NCAER) survey that estimated that India’s middle class was between 100 million and 300 million.

The then managing editor of Fortune magazine, Marshall Loeb, was obsessed with the counterintuitive story of a fast-growing middle class in a country still synonymous with poverty. For my story, Loeb devised a headline that trumpeted, “India Opens for Business: The world’s largest middle class beckons foreign investors." The article quoted NCAER data which estimated that the lower middle class, with annual household incomes of $700 to $1400, was responsible for 75% of unit sales of radios and soap and between a third and half of all shampoo and TV sets.

It was my first cover story, yet, I regret aspects of it. While the article had a few caveats about the limited purchasing power of India’s middle class, it still reads as unbalanced. In a final irony, Loeb ensured I was promoted after it was published, thus propelling me into the ranks of the American middle class.

My promotion was partly the reward for an overly rosy assessment of India’s prospects. It was not fake news, but it offered a vision of an India mostly unencumbered by centuries of grotesque caste and gender inequality and almost five decades of bumbling socialist bureaucracy—major handicaps that hobble the expansion of the middle class to this day.

A vague national aspiration

A couple of months ago, economist Himanshu parsed the data released by the National Sample Survey Office in the absence of more detailed consumption expenditure surveys that the government has chosen not to release. He reported in an article for this paper that in 2018 prices, average rural consumption expenditure declined from ₹1,587 per person per month (ppm) in 2014 to ₹1,524 ppm in 2017-18. The decline in urban areas was from ₹2,926 ppm in 2014 to ₹2,909 ppm in 2017-18.

As those startling numbers indicate, almost three decades after reforms started in 1991, the very notion of a middle class is more of a vague national aspiration than an actuality in India. “The middle class in our minds is actually the upper class," says Rama Bijapurkar, the well-known marketing consultant. Bijapurkar repeats the witticism that the middle class in India is “more sociological than logical." She prefers the term Middle India. That is a better description for people who are merely in the middle of the population in income terms but not at all a middle class. Those with a per capita income between $10 and $20 a day belong to the global middle class, according to a 2015 Pew Research Centre report. This would translate into the top 3% of India’s population.

A sleight of hand

Reading about the birth of the US’s middle class is a reminder of how far India has to go. Economist Robert Gordon argues in The Rise and Fall of American Growth that the large productivity increases in the US occurred in the 50 to 100 years before 1970 as the middle class grew dramatically and became more productive because of increased ownership of everything from the motor car to the washing machine.

This qualitatively changed lives across the country in a more dramatic manner than the computer has. The successive drops in the price of Ford’s Model T car meant that nearly 90% of American households had acquired cars in the first three decades of the 20th century, up from a mere 8,000 households in 1900.

By contrast, a hundred years on, India’s middle class seems a sleight of hand on a calculator, the result of projecting years of exponential growth. In a cover story last year in The Economist, Stanley Pignal, warned that “a strategy of waiting for the middle class to develop a taste for products that the global middle class indulges in may lead to decades of frustration. If nearly 300 million Indians count as middle class, as HSBC has proclaimed, some of them make $3 a day…for only one in ten Indians would the latest iPhone represent less than half a year’s salary."

Purchasing power parity calculations are useful to explain how lower rents and food costs increase buying power, but, ultimately the price of an iPhone or a Honda City car in India mimic international prices and one needs a large, genuinely well-heeled middle class. The cost of a part-time help or the services of a chauffeur in India may make life comfortable for those able to afford them, but these are held down precisely because of the inability of millions to find better work in factories and offices.

The reforms needed

Starkly incomplete reforms with regard to liberalizing labour laws, improving education and nutrition, freeing up agricultural prices and improving the stewardship of state-owned banks have hobbled the growth of the middle class. A seemingly infinite legacy of inequality of caste and poor education has not helped.

Economists such as Angus Deaton and Joseph Stiglitz have shown how inequality brought more inequality in the US as the workforce there was buffeted by technology and globalization and the cost of college education skyrocketed. In India, this challenge is multiplied because our primary and secondary education is so poor and millions of our children are malnourished. The stunting of the Indian middle class is also the result of the decades-long inability to make India a manufacturing hub for multinationals. The more recent arrested progress has been the result of demonetization and a chaotically-implemented goods and services tax (GST)—both appear to have driven thousands of small firms out of business and have bludgeoned the informal sector. Nowhere in the world has a country built a middle class without transitioning via a large share of employment in manufacturing.

Still, India seemed to be doing well enough till the financial crisis of 2008, on the back of increases in exports and a booming software and business processes outsourcing industry. Contrasting the growth rates then and now in The Indian Express, Harish Damodaran pointed to two-wheeler sales jumping from 3.6 million in 2000-01 to 16.5 million in 2015-16 while passenger cars quadrupled to 2.8 million over the same period.

Over the past five to six years, this expansion in consumption was despite a lack of rapid income growth. Real rural wages had been limping at about 1% annual growth for more than half a decade but sales of non-durables continued to motor along. The likely explanation is that consumers remained confident that their incomes would eventually rise, and continued to spend freely. The drop in household savings by about five percentage points over the past few years to about 17% of the gross domestic product is a reflection of such optimism.

Troubles ahead

Now, different elements that propelled the growth trajectory that widened India’s middle class are sagging. Manufacturing exports over the past five years have scarcely grown at all. Construction is beset by unsold housing inventory of about $60 billion. IT services, responsible for a visible expansion of a genuine middle class in cities such as Gurugram and Bengaluru, has grown to be a $180 billion behemoth.

IT services are projected to have an annual growth of around 7-9% off a much higher base, but that contrasts with about 30% in the first decade of the 21st century. “You cannot apply the model of growth that characterized the rest of Asia. These countries rode the wave of globalization and moved up from making shoes to computers," says Nandan Nilekani, non-executive chairman of Infosys. “Manufacturing requires superb infrastructure."

Crucially, a growing middle class requires the wide participation of women in the workplace. India’s female workforce participation rate has fallen to 24%.

Sure, India will benefit from the relocation of factory work from China, but much less than it needs to build a middle class. The gig economy is projected to create 1.5 million jobs this fiscal year, but few working at the receiving end of artificial intelligence’s whip hand regard these jobs as stable or secure. This is a tragedy for India not just in economic terms but because the journey into the middle class is usually a path out of grinding menial labour.

I spoke recently with Rajesh Kumar, a factory employee at Shahi Exports, India’s largest garments exporter. Kumar, 47, had started as a sweeper in the factory. After retraining, he worked his way up to supervisor at its Faridabad factory. Owning his home and switching from the bicycle he once had to the motorcycle he rides today and a salary of close to ₹25,000 per month gives him a sense of security. For vast numbers of Indians, however, the prospect of financial security and genuine advancement is slipping out of reach.

On Sunday, I was driven home by a novice driver from rural Karnataka using his “employer’s" Uber identity. Unkempt and exhausted, he had slept in the car over the past two days. He did not understand the zig-zagging blue arrows on Google’s maps. “Slight left" in Google’s artificial English inevitably proved incomprehensible.

This microcosm of misery of a recent job-seeker in the shining city was a reminder that the gig economy, for all its frenetic energy, will also fall well short of building the broad middle class India needs.

Rahul Jacob is a former business writer in Asia for Time magazine and former Hong Kong bureau chief for the Financial Times


25.1. Opinion | Capitalism needs reinvention to see off its political challenges
Livemint, 15 Oct. 2019

Its current form has given us capital accumulation in the hands of a few at the cost of the majority

Some two months ago, the Business Roundtable, a club of big business CEOs in the US, declared that corporations should have a larger purpose beyond maximizing shareholder wealth. They said a corporation should invest in employees, deliver value to customers, deal ethically with suppliers and support communities.

This recast of the corporate purpose comes at a time when politicians are targeting large companies for their selfishness. With threats of heavier taxation and income redistribution looming as a US presidential election approaches, only the tone-deaf CEO would say that he cares two hoots for anyone other than shareholders.

Worldwide, capitalism and market economics have never seen such a political challenge since, possibly, the times of Karl Marx. Not without reason. The economic problems of the world can be summed up in one line: the lopsided accumulation of capital in a few hands at the cost of the majority.

This concentration affects both rich and poor economies. This is probably why most presidential hopefuls in the US sound like socialists stuck in the wrong century rather than stout defenders of market economics. Communism, though, remains discredited. In the knowledge era, the primary conflict is not between capital and labour, but between different types of capital.

Financial capital rules supreme and the problem can be defined as inadequate investment in other kinds—such as physical capital (infrastructure), social capital (education and health), human capital (skills and knowledge) and governance capital (state capacity to govern). We must develop channels for the flow of financial capital and knowledge into other kinds of capital for capitalism to be restored to health.

In the absence of these channels, financial capital is destroying human capital by replacing it with other kinds. The focus of capitalism needs to shift from replacing labour to making technology work well alongside human capital, so that the strengths of humans and robots (or software and Artificial Intelligence) complement each other.

Another mandated shift is from debt to equity. Those who control huge amounts of money are turning risk-averse, and investing in safe debt (such as US Treasury bonds and German bunds) and this is why returns in global debt markets are trending towards zero. This is a tragedy. Not just poor countries but even the US needs that money to invest in physical and social infrastructure. It can’t be done with just debt.

The old capitalist system is broken not because capitalism has failed, but because new methods haven’t been devised to channel financial capital surpluses into other forms of capital.

Another deficit area is governance capital. The state capacity to grasp challenges and implement effective policies is diminishing. With technology and capital flows shifting dizzyingly fast, governments seem ill-equipped to take the right decisions. Corporate expertise is thus vital to governance.

The old global trading system is also in disrepair, as capitalism clashes with culture and the nation-state. This could have been foreseen, but trade theorists ignored the human cost of disruptions. Any system which ignores the reality that trade produces unequal outcomes, with winners and losers, will ultimately fail. Trade pacts that lack mechanisms to identify losers early and help them succeed will fall apart. The Regional Comprehensive Economic Partnership (RCEP) is unlikely to benefit countries such as India, as it does not live up to its name. It is difficult to call it a “comprehensive partnership" when it effectively excludes services, thus denying India an opportunity to balance merchandise trade deficits with service surpluses. India would be foolish to join the RCEP when its overall trade deficit is more than $100 billion with its partner nations, especially China.

Capitalism is failing because it clashes with culture and human xenophobia. If human capital is not allowed to move easily to the place of its maximum return, how will it work effectively?

Traditionally, governments have used taxation to tap surpluses generated by financial capital, and invest in human, social and physical capital. However, high personal taxation is unsustainable in countries with highly diverse populations such as the US and India. In monocultural countries (as in Scandinavia), citizens accept high levels of marginal taxation because they know that their money is going to grandma, or a neighbour’s child who is like their own. However, put people from other cultures in the population mix, and the willingness to pay those taxes drops. High personal income taxes in diverse countries often result in high evasion.

The rebirth of capitalism depends on how we solve its current problems. Large surpluses of financial capital need to be reinvested in social, physical and human capital. Ways need to be found to compensate losers from trade and technology by investing in their competitive capabilities. Risk-averse debt capital needs to shift to equity, especially in places where it is most needed,including India and depressed parts of the rich world.

Capitalism hasn’t failed. It just hasn’t found the right formula for investing its surpluses in other forms of capital.

R. Jagannathan is editorial director, ‘Swarajya’ magazine


25.2. The young knight of the chess world
Livemint, 18 Oct. 2019, Omkar Khandekar
  • R. Praggnanandhaa, the Under-18 world chess champion, lives and breathes the game 
  • 14-year-old chess star became the world champion at the World Youth Chess Championships in Mumbai 
In quick succession, R. Praggnanandhaa has taken hold of his opponent’s rook and pawn. The black king has been cornered. The white queen is on a rampage.

Then, unexpectedly, Praggnanandhaa extends his hand, offering truce. His rival, Valentin Buckels from Germany, grabs it. The match has ended in a draw, except that the Indian has emerged the winner. After the 11-match marathon at the World Youth Chess Championship, held in Mumbai earlier this month, 14-year-old Praggnanandhaa is the Under-18 world champion.

He rearranges the chessboard and walks out of the auditorium. Heads turn, admirers whisper their congratulations. Outside, many others come to shake hands, pose for selfies. He obliges but looks like he has barely registered his feat. A reporter straps a collar mic on him. “You can smile now," he tells him as he takes his position in the frame. Praggnanandhaa, for the first time, cracks his mouth open shyly, into a more universally accepted expression of happiness.

Praggnanandhaa’s reserve is in sharp contrast to his parents. His mother, Nagalakshmi, a homemaker who accompanies her son to chess tournaments around the world, can’t stop beaming. His father, Rameshbabu, who couldn’t take time off from his job at a cooperative bank in Tamil Nadu to attend the championship, says over the phone that he too can’t explain his son’s calm attitude after matches. “It’s a peculiar one," he admits.

But it is this temperament that has helped him register consistent victories over the past decade. A native of Padi in suburban Chennai, Praggnanandhaa started playing tournaments at the age of 5. At 7, he won the Under-8 category title in the World Youth Chess Championship. At 10, he became the youngest international master (IM) in history. At 12, he became the second youngest grandmaster (GM) ever, a year earlier than the current world champion, Magnus Carlsen.

He has had his share of defeats. He would be the first to tell you he has a long way to go before he can come anywhereclose to the reigning chess greats. But setbacks don’t seem to faze him, just as victories don’t make him complacent. “More than anything else, he just loves playing," his father told ESPN last year. “Results to him don’t matter that much."

Praggnanandhaa isn’t a talker. His replies are precise and unpretentious. It only takes him minutes to wrap up interactions with a couple of mediapersons waiting to interview him. Soon, he’s ready for me. Would he rather take a break, maybe hang out with his mum? I ask. “No," he says. “Let’s finish this up first."

We walk to a coffee shop in the hotel premises, taking seats across the table.

How did he prepare for the tournament? I ask him.

“It was nothing special. I worked on my opening, middlegame, endgame. I was working quite hard. Somehow it worked out."

It seemed like he could have pushed for victory. Why offer a draw?

“I could have tried if Sargsyan (the top-seeded Armenian who trailed Praggnanandhaa by half a point in the overall standings before the final round) had won. But after he made a draw, I thought, let’s make a draw."

Any nervous moments?

“All games are tough. In Under-18, everyone comes prepared. It’s very hard."

So what worked for him?

He shrugs. “I don’t know what they did. I was preparing normally."

Praggnanandhaa’s journey in chess started at age 3, after his sister Vaishali was enrolled in a chess class to wean her off television. Vaishali became an international master at 15. Praggnanandhaa, who grew up battling his sibling on the board, started beating her at her own game in a few years. Soon, R.B. Ramesh, whose Chennai-based Chess Gurukul has honed some of India’s most promising young talents, offered to coach him.

“There was a point where I was hesitant on whether I should (have him continue playing) because of financial requirements," says Rameshbabu. But then a local industrialist offered to sponsor Praggnanandhaa. His school, too, offered him free education and relaxed attendance norms so he could concentrate on the game.

Back home, Praggnanandhaa takes a bus or an auto rickshaw to his coach’s academy, an hour away. There, he spends 4-6 hours working on his game. Afterwards, he unwinds over a game of table tennis with his coach’s son. Recently, he has also taken up swimming to stay fit. It may not seem like it, but chess can be physically demanding.

Praggnanandhaa’s is the kind of dedication that has been acknowledged by players such as Viswanathan Anand, the top-ranked Indian in chess for nearly two decades. “What impresses me about Praggnanandhaa is that he’s not just a strong player but mixes imaginative middlegame play with patient endgame skills," he told ESPN.

Has there ever been a point when he has felt he has had a bit too much chess, that he needs to get away for a bit? I ask.

“No," Praggnanandhaa says simply.

Never?

“No. Maybe when I am 30. But not now."

His next area of focus was a world juniors’ championship, which started in Delhi on 14 October. He was joint leader after two rounds, but there is still a long way to go—the tournament concludes on 26 October. What does he think of his chances?

“Everyone from here will be there. So more will come."

And does he think he will make it there?

“I will try for sure," he says, pokerface on point. “I will try to get a medal."

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