Livemint summary April 2024
Why expat CEOs don’t click at Indian IT firms
Wipro has seen a decline in its revenue growth in the past years and the expat CEO had to be replaced. Wipro used to be among the top three IT firms along with TCS and Infosys. But, HCL has now replaced it. Theiry Delaporte has been removed from Wipro. He earlier served Campegmini. A year ago, Brian Humphrey was removed from Cognizant. Both were expatriate CEOs. Vishal Sikka from the US was the first non-founder CEO at Infosys but even that became unsuccessful. AI has again been blamed as the greatest disruptor in the industry.
CEO chairperson: Rishad Premji
Wipro has suffered due to cultural changes prevailing in the industry and Wipro has failed to catch up.
Delaporte was supposed to end his term in 2025. It is not new for a Wipro CEO to have stepped down before completing their terms.
Raveneet Kaur, CCI chairperson, has quoted about AI and ML
She says that AI and ML pose problems related to market concentration.
She has also said that these industries drive innovation, efficiency, and personalization.
Crosswords reach down, across a century
Crossword puzzles were invented a century back to reach a huge success. They were the brainchild of a bunch of youths who faced challenges about how to publish a book but could not find ideas, hence began publishing crossword puzzles.
The books sold for USD 1.35 with a sharpened pencil and an eraser included sold so many copies. They first sold 3,600 copies which then escalated to 25,000 copies.
It is also seen as a symbol of feminism since Peterbridge and her colleagues published them. Simon & Schuster publication was the name.
Even now, a century later, Twitch and discord streams have someone solving a crossword puzzle while the others chat and make guesses.
Hence, the culture has come down to us till this day.
Drugs regulator asks states for sales, mfg data on jabs
Many children in Gambia and Uzbekistan have died after consuming cough syrups manufactured in India.
WHO has placed Indian pharma industries under scrutiny.
Central Drugs Standard Control Organization (CDSCO) has asked Indian Pharmaceutical companies to comply to the WHO guidelines and have asked govts to submit reports about their pharma companies.
Commerce ministry told to examine treaty text
The PMO has asked the Ministry of Commerce to re-examine the text of Bilateral Investment Treaty (BIT) to increase ease of doing business.
The PMO has asked the Ministry of Commerce to provide a third party perspective on the model text.
The developed nations have expressed concerns with the topic of 'dispute resolution' in the BIT.
India fought and lost two international cases (Vodafone and Cairn Energy Plc) related to the retrospective levy of taxes.
Govt fixes SOP for quick sanction, approval of nat’l highway projects
The sanction and approval process SOPs for national highways have been made paperless. It has been made applicable to NHAI, Border Road Organization, state govt, etc.
India, Oman conclude trade negotiations, will sign deal after electionsIndia and Oman will likely sign a free trade agreement with will likely be effective after the formation of the new govt in India. It will make petroleum, textiles, iron and steel, etc sectors tax free and increase Indian exports to Oman.
Latest world economy updates in five chartsHigh Inflation forces Japan to end the negative interest rate regimeJapan has slipped into recession because the negative interest rate discouraged foreign investors to engage in the yen. The Japanese economy is shrinking and the GDP is declining. Japan has slipped into a recession, lost its position of the third largest GDP to Germany.
Japan has raised its key policy interest rates like most other countries in the world. Key rate: Determines the bank lending rate and cost of credit for borrowers.Key rateJapan's central bank has increased the benchmark rate from -0.1% to 0 to 0.1%.Benchmark rateJapan took the decision to have a negative lending rate in 2016. Most other countries decreased their lending rates during the Covid that followed to increase investments. Japan remained adamant even after losing its position as the third largest economy to Germany. But, Japan took the decision to increase lending rates again because its inflation grew more than 2%, their maximum inflation target. UKThe UK feared a recession for so long but in January this year, the GDP grew up by 0.2% alleviating those fears. The Rishi Sunak govt is facing threats of economic slowdown and high inflation. Boeing's CEO will step down by the end of 2024Boeing has manufactured aircraft related machinery products which are proving to be a threat to lives. Boeing 737MAX9 Aircraft was being operated by Alaska airlines but it blewout. After this incident, Boeing's shares have declined by 25%. It has also violated arms export norms. It also led to a fractured cockpit window. A whistle blower who encouraged investigations in Boeing is now dead. So, the CEO, John Calhoun will step down by 2024.Hard YieldsUS yields are rising despite fears of economic slowdowns. Yield meaning: Income earned from shares and bonds The US Federal Reserve has said that there will be three rate cuts in 2024 and an the monetary policy will be eased. But, it may lead to inflation. The US Federal Reserve targets 2% inflation rate but the inflation rate has stayed above this target.
Price PitchMajority of adults in the US, Germany, UK, France, Mexico, Spain, etc are feeling stress due to price rise. The cause is low food production, war, supply chain issues, etc.
Adani Green Energy Limited will Set up the largest Renewable Energy Park of India in GujaratRs. 1.5 trillion Renewable energy part will be set up. Capacity= 30Gigawatt (26 GW solar, 4 GW wind)Location- Khavda, GujaratAim: 45 GW by 2030.
Milk prices to soar as water scarcity hits productionMaharashtra and Gujarat will be hit by heat waves and milk prices will soar. It happens every year but it is supposed to be worse this year. Dams and rivers are getting dried up.
Tesla's productions decreaseTesla saw a quick expansion. Now, its shares have gone down by 34%. It has become the worst performer in S&P 500 Index. Tesla is still the largest automobile producer. It is still a major player in the electric vehicle sector and the largest in the US. Market capitalization of Tesla was at its highest in 2021 but now it has fallen to half. Elon Musk has diverted his attention toward various sectors like Twitter and AI. Tesla had to announce a price cut quietly on its website as high as 20% because its competitors who do not have a double-digit growth cannot decrease prices to such an extent while Tesla can tolerate it.
Ex- Gazprom unit refuses to pay GAILGazprom had a unit which it now does not own. That unit did not deliver some LNG supplies to GAIL in the aftermath of the Ukraine war. Gazprom is the Russian energy giant. GAIL went to the London Court of International Arbitration seeking compensation of USD 1.8 million but Gazprom believes that it owed nothing to GAIL other than the default LNG supplies. In 2012, GAIL had a 20 year deal with Gazprom to buy LNG worth 2.8 million tonnes per annum.
(Indian Metereological Department) IMD using AI, ML to enhance forecastsIMD head- Mrityunjay Mohapatra39 doppler weather radars have been deployed by IMD.They cover about 85% of the country's area and give an hourly weather forecast of India's major cities. The IMD can predict the weather for even 10 sq km area.
IRDAI raises doubt over IIHL's RCap BidIIHL- IndusInd International HoldingsIIHL is interested in Reliance Capital but IRDAI is worried about it. Reliance Capital is debt-ridden. (It is owned by Anil Ambani Group).Reliance Capital is now under Nageshwar Rao. Reliance Capital provides insurance services which also includes non-life insurance products.
China calls the AUKUS pact dangerous as it could spur the regional arms race AUKUS pact- It is a defense partnership pact between Australia, the UK, and the USA. The pact wants to use Japan as a deterrent against the Chinese forces. The AUKUS countries are now ready for pillar two of the pact- AI, quantum computing, undersea hypersonic, etc will be developed. First pillar- Australia will get nuclear-powered submarines.
Tata Steel India Sales up 6% in FY24Tata Steel reported a growth in its deliveries by 6% (19.9 million tonnes).
US and China resume defense talksSevere tensions are observed in the South China Sea and the authority over Taiwan. Nancy Pelosi, the then in-house speaker of the US had visited Taiwan and all dialogues between the US and China has stopped since then related to these issues. Even during the pandemic, China did not agree to conduct offline meetings with the US as they did not want the coronavirus to spread. The US President, Biden, and Xi Jinping have met for the first time since then.
FPI (Foreign Portfolio Investors) pulled Rs 325 crore from stocks in AprilAs elections are going to be held in India and there are relatively high valuations, the Foreign Portfolio investors have pulled out the money. Rs. 35000 crore was invested by the FPIs in March.
Blackrock and ADIA want to take up more stakes in VedantaBlack Rock- World's largest asset managerADIA- Abu Dhabi Investment AuthorityThey have increased their shares in Vedanta in the last four months by 2%.Vedanta now has demerger plans and is increasing steel prices.
RBI has a better handle on Rupee managementRupee derivatives are subject to Forex risks. To save investors from risks, RBI wants them to do risk hedging. So, it asked investors to comply and provide enough reasons about why they think that they will be able to avoid financial risks on their investment when the economic scenario is rapidly changing at the global level. Brokers asked their clients to provide the relevant information after which many have backed away. RBI had given a last date until 5th April to submit the data but now the date has been extended till May. Many investors just join the share market without much financial knowledge and with the desire to enjoy a casino-like effect. They end up losing a lot of money. Evidence of exposure- In 2014, the RBI had relaxed the law saying that a person may trade without providing any evidence of exposure. But, many have misinterpreted this relaxation and think that they can trade risk-free which is not true. The last financial year showed macro stability in the RBI- The INR has remained stable against the dollar falling not even 1% compared to it. It has remained the most stable compared to its peer currencies. 2022-23 showed a volatility but the last year saw rapid recovery of the INR.As interest rates soften in the US, more Indian people will take loans from the US. And, it may also mean that more people in the US will invest in India. India cannot solve the water crisis without pricing it appropriatelyIndia faces a water crisis and water scarcity because people get access to water at a very nominal cost. Hence, water is misused a lot. If water gets more expensive then people will be forced to use it lesser and lesser. The Kaveri water crisis is because different states have disputed the use of water. Whenever a party goes to the tribunal, the tribunal assigns more water to it from the Kaveri River. The author thinks that the govt should make those states pay more money for water that receives more water from the Kaveri River and give it to those states which receive less.
The author thinks that the Indian politicians give a lot of free things that should otherwise be paid for, like free water and free electricity. It is the reason why these resources are used at more than their optimum levels. The author thinks that the govt should take a very drastic measure and make free things paid instead to prevent their misuse. What is a currency derivative
Adani Ports and Logistics has crossed 400 million metric tonnes milestone1/4th of India's seaborne cargo passes through the ports of Adani Ports and Logistics. 15 ports and terminals in India and 2 in Sri Lanka and Israel. 12 Logistics parks across India.
Meaning of logistics parks
Can Breaking Up Big Tech Really Help BusinessesMicrosoft has a video conferencing platform called Teams. Microsoft is going to unbundle it from its MS Office Suite. It is after European probe about anti-competitive practices.
Microsoft vs SlackSlack was a productivity app of Salesforce that challenged in the EU courts that Microsoft was using its market dominance to promote its Teams. It was causing a loss to Slack.EU regulators ruled out that indeed, Microsoft had used its market dominance to achieve that feat. Microsoft unbundled Teams to delay further investigation. Teams now has 320 million active users while Slack has only 79 million active users.
India's Competition Act, 2002India has laws on market abuse as well and it covers the Big Tech firms too. Google and its Playstore policies are under scrutiny by such laws. The homegrown tech firms have been demanding for unbundling of apps in the Playstore. In March, the Committee on Digital Competition Law introduced a draft Digital Competition Bill, 2024.It includes unbundling of apps for big tech firmshow apps can share dataTwo groups will be impacted:Users: There will be silos of many appsSmall businesses: They will not be able to understand which policies lead to abuse of market power. Is this regulation good for privacy?The users can now decide which apps they want to share their data which and which ones not to.It will be more difficult to synchronize calendars between various apps. Small businesses could earlier provide more targeted advertisements which will not be possible now. Startups vs small businessesStartups that want to break up these big tech companies generally operate platforms themselves. Small businesses will find it difficult to acquire more customers because they will have a smaller database of users. Digital ads have become the main medium to sell products these days.
Apple is going to build homes for its employeesApple is going to build over 78,000 homes for its workers. It has created over 1,50,000 jobs by shifting a part of its supply chain to India. Now, to appease its disgruntled employees, it wants to build homes for them mainly in Tamil Nadu. Cryptos Rallying Again but Concerns RemainCryptocurrencies have become unpopular recently. Investors were not interested in investing in cryptocurrencies but they are again rising in popularity. Around 75% of Indian population trading in cryptocurrency are below 35 years age. FTX: Cryptocurrency exchange that imploded in 2022. Its founder, Fried, is in jail. The price of bitcoin $1.3 billion is the largest share of the market capital. The ETF PushETF: Exchange Traded FundsUS Security Exchange CommissionIt was reluctant to accept Bitcoin but now it has included Bitcoin in its traditional fold. Crypto exchanges come with their own set of complexities. Investors want to diversify their portfolios without getting into the complexities of crypto exchanges. Top three ETFs:Greyscale Bitcoin TrustiShare Bitcoin TrustFidelity Wise Origin Bitcoin Trust
Illicit Activity in CryptoValue of illicit activity in Crypto fell by 39% in 2023.SEC head Glenson said that a lot of illicit activity like ransom ware, money laundering, etc can be done using cryptocurrencies. It is a speculative and volatile business. Cryptocurrency is also used by hackers though it fell by 50% but proceeds from drug sales rose by over 20% Hence, whenit comes to cryptocurrency, there is always a competition between businesses and scammers.Google also sued 87 apps installers who installed fraudulent app
The sanction and approval process SOPs for national highways have been made paperless. It has been made applicable to NHAI, Border Road Organization, state govt, etc.
OCI card scheme may add Fiji
OCI card is a way to make deeper links with the Indian diaspora. Many immigrants went from India to Suriname and Fiji. Their descendants receive the OCI card and it gives them parity with the Indian citizens and NRIs. However, it does not allow them to vote or stand for any elected office in India. In Suriname, the OCI card facility was extended from the fourth generation to the sixth generation immigrants from India. Hence, it was relaxed. The GoI is now deciding to extend OCI card facilities to Fiji as well. OCI- Overseas Citizen of India.India, Oman conclude trade negotiations, will sign deal after electionsIndia and Oman will likely sign a free trade agreement with will likely be effective after the formation of the new govt in India. It will make petroleum, textiles, iron and steel, etc sectors tax free and increase Indian exports to Oman.
Latest world economy updates in five chartsHigh Inflation forces Japan to end the negative interest rate regimeJapan has slipped into recession because the negative interest rate discouraged foreign investors to engage in the yen. The Japanese economy is shrinking and the GDP is declining. Japan has slipped into a recession, lost its position of the third largest GDP to Germany.
Japan has raised its key policy interest rates like most other countries in the world. Key rate: Determines the bank lending rate and cost of credit for borrowers.Key rateJapan's central bank has increased the benchmark rate from -0.1% to 0 to 0.1%.Benchmark rateJapan took the decision to have a negative lending rate in 2016. Most other countries decreased their lending rates during the Covid that followed to increase investments. Japan remained adamant even after losing its position as the third largest economy to Germany. But, Japan took the decision to increase lending rates again because its inflation grew more than 2%, their maximum inflation target. UKThe UK feared a recession for so long but in January this year, the GDP grew up by 0.2% alleviating those fears. The Rishi Sunak govt is facing threats of economic slowdown and high inflation. Boeing's CEO will step down by the end of 2024Boeing has manufactured aircraft related machinery products which are proving to be a threat to lives. Boeing 737MAX9 Aircraft was being operated by Alaska airlines but it blewout. After this incident, Boeing's shares have declined by 25%. It has also violated arms export norms. It also led to a fractured cockpit window. A whistle blower who encouraged investigations in Boeing is now dead. So, the CEO, John Calhoun will step down by 2024.Hard YieldsUS yields are rising despite fears of economic slowdowns. Yield meaning: Income earned from shares and bonds The US Federal Reserve has said that there will be three rate cuts in 2024 and an the monetary policy will be eased. But, it may lead to inflation. The US Federal Reserve targets 2% inflation rate but the inflation rate has stayed above this target.
Price PitchMajority of adults in the US, Germany, UK, France, Mexico, Spain, etc are feeling stress due to price rise. The cause is low food production, war, supply chain issues, etc.
Adani Green Energy Limited will Set up the largest Renewable Energy Park of India in GujaratRs. 1.5 trillion Renewable energy part will be set up. Capacity= 30Gigawatt (26 GW solar, 4 GW wind)Location- Khavda, GujaratAim: 45 GW by 2030.
Milk prices to soar as water scarcity hits productionMaharashtra and Gujarat will be hit by heat waves and milk prices will soar. It happens every year but it is supposed to be worse this year. Dams and rivers are getting dried up.
Tesla's productions decreaseTesla saw a quick expansion. Now, its shares have gone down by 34%. It has become the worst performer in S&P 500 Index. Tesla is still the largest automobile producer. It is still a major player in the electric vehicle sector and the largest in the US. Market capitalization of Tesla was at its highest in 2021 but now it has fallen to half. Elon Musk has diverted his attention toward various sectors like Twitter and AI. Tesla had to announce a price cut quietly on its website as high as 20% because its competitors who do not have a double-digit growth cannot decrease prices to such an extent while Tesla can tolerate it.
Ex- Gazprom unit refuses to pay GAILGazprom had a unit which it now does not own. That unit did not deliver some LNG supplies to GAIL in the aftermath of the Ukraine war. Gazprom is the Russian energy giant. GAIL went to the London Court of International Arbitration seeking compensation of USD 1.8 million but Gazprom believes that it owed nothing to GAIL other than the default LNG supplies. In 2012, GAIL had a 20 year deal with Gazprom to buy LNG worth 2.8 million tonnes per annum.
(Indian Metereological Department) IMD using AI, ML to enhance forecastsIMD head- Mrityunjay Mohapatra39 doppler weather radars have been deployed by IMD.They cover about 85% of the country's area and give an hourly weather forecast of India's major cities. The IMD can predict the weather for even 10 sq km area.
IRDAI raises doubt over IIHL's RCap BidIIHL- IndusInd International HoldingsIIHL is interested in Reliance Capital but IRDAI is worried about it. Reliance Capital is debt-ridden. (It is owned by Anil Ambani Group).Reliance Capital is now under Nageshwar Rao. Reliance Capital provides insurance services which also includes non-life insurance products.
China calls the AUKUS pact dangerous as it could spur the regional arms race AUKUS pact- It is a defense partnership pact between Australia, the UK, and the USA. The pact wants to use Japan as a deterrent against the Chinese forces. The AUKUS countries are now ready for pillar two of the pact- AI, quantum computing, undersea hypersonic, etc will be developed. First pillar- Australia will get nuclear-powered submarines.
Tata Steel India Sales up 6% in FY24Tata Steel reported a growth in its deliveries by 6% (19.9 million tonnes).
US and China resume defense talksSevere tensions are observed in the South China Sea and the authority over Taiwan. Nancy Pelosi, the then in-house speaker of the US had visited Taiwan and all dialogues between the US and China has stopped since then related to these issues. Even during the pandemic, China did not agree to conduct offline meetings with the US as they did not want the coronavirus to spread. The US President, Biden, and Xi Jinping have met for the first time since then.
FPI (Foreign Portfolio Investors) pulled Rs 325 crore from stocks in AprilAs elections are going to be held in India and there are relatively high valuations, the Foreign Portfolio investors have pulled out the money. Rs. 35000 crore was invested by the FPIs in March.
Blackrock and ADIA want to take up more stakes in VedantaBlack Rock- World's largest asset managerADIA- Abu Dhabi Investment AuthorityThey have increased their shares in Vedanta in the last four months by 2%.Vedanta now has demerger plans and is increasing steel prices.
RBI has a better handle on Rupee managementRupee derivatives are subject to Forex risks. To save investors from risks, RBI wants them to do risk hedging. So, it asked investors to comply and provide enough reasons about why they think that they will be able to avoid financial risks on their investment when the economic scenario is rapidly changing at the global level. Brokers asked their clients to provide the relevant information after which many have backed away. RBI had given a last date until 5th April to submit the data but now the date has been extended till May. Many investors just join the share market without much financial knowledge and with the desire to enjoy a casino-like effect. They end up losing a lot of money. Evidence of exposure- In 2014, the RBI had relaxed the law saying that a person may trade without providing any evidence of exposure. But, many have misinterpreted this relaxation and think that they can trade risk-free which is not true. The last financial year showed macro stability in the RBI- The INR has remained stable against the dollar falling not even 1% compared to it. It has remained the most stable compared to its peer currencies. 2022-23 showed a volatility but the last year saw rapid recovery of the INR.As interest rates soften in the US, more Indian people will take loans from the US. And, it may also mean that more people in the US will invest in India. India cannot solve the water crisis without pricing it appropriatelyIndia faces a water crisis and water scarcity because people get access to water at a very nominal cost. Hence, water is misused a lot. If water gets more expensive then people will be forced to use it lesser and lesser. The Kaveri water crisis is because different states have disputed the use of water. Whenever a party goes to the tribunal, the tribunal assigns more water to it from the Kaveri River. The author thinks that the govt should make those states pay more money for water that receives more water from the Kaveri River and give it to those states which receive less.
The author thinks that the Indian politicians give a lot of free things that should otherwise be paid for, like free water and free electricity. It is the reason why these resources are used at more than their optimum levels. The author thinks that the govt should take a very drastic measure and make free things paid instead to prevent their misuse. What is a currency derivative
Adani Ports and Logistics has crossed 400 million metric tonnes milestone1/4th of India's seaborne cargo passes through the ports of Adani Ports and Logistics. 15 ports and terminals in India and 2 in Sri Lanka and Israel. 12 Logistics parks across India.
Meaning of logistics parks
Can Breaking Up Big Tech Really Help BusinessesMicrosoft has a video conferencing platform called Teams. Microsoft is going to unbundle it from its MS Office Suite. It is after European probe about anti-competitive practices.
Microsoft vs SlackSlack was a productivity app of Salesforce that challenged in the EU courts that Microsoft was using its market dominance to promote its Teams. It was causing a loss to Slack.EU regulators ruled out that indeed, Microsoft had used its market dominance to achieve that feat. Microsoft unbundled Teams to delay further investigation. Teams now has 320 million active users while Slack has only 79 million active users.
India's Competition Act, 2002India has laws on market abuse as well and it covers the Big Tech firms too. Google and its Playstore policies are under scrutiny by such laws. The homegrown tech firms have been demanding for unbundling of apps in the Playstore. In March, the Committee on Digital Competition Law introduced a draft Digital Competition Bill, 2024.It includes unbundling of apps for big tech firmshow apps can share dataTwo groups will be impacted:Users: There will be silos of many appsSmall businesses: They will not be able to understand which policies lead to abuse of market power. Is this regulation good for privacy?The users can now decide which apps they want to share their data which and which ones not to.It will be more difficult to synchronize calendars between various apps. Small businesses could earlier provide more targeted advertisements which will not be possible now. Startups vs small businessesStartups that want to break up these big tech companies generally operate platforms themselves. Small businesses will find it difficult to acquire more customers because they will have a smaller database of users. Digital ads have become the main medium to sell products these days.
Apple is going to build homes for its employeesApple is going to build over 78,000 homes for its workers. It has created over 1,50,000 jobs by shifting a part of its supply chain to India. Now, to appease its disgruntled employees, it wants to build homes for them mainly in Tamil Nadu. Cryptos Rallying Again but Concerns RemainCryptocurrencies have become unpopular recently. Investors were not interested in investing in cryptocurrencies but they are again rising in popularity. Around 75% of Indian population trading in cryptocurrency are below 35 years age. FTX: Cryptocurrency exchange that imploded in 2022. Its founder, Fried, is in jail. The price of bitcoin $1.3 billion is the largest share of the market capital. The ETF PushETF: Exchange Traded FundsUS Security Exchange CommissionIt was reluctant to accept Bitcoin but now it has included Bitcoin in its traditional fold. Crypto exchanges come with their own set of complexities. Investors want to diversify their portfolios without getting into the complexities of crypto exchanges. Top three ETFs:Greyscale Bitcoin TrustiShare Bitcoin TrustFidelity Wise Origin Bitcoin Trust
Illicit Activity in CryptoValue of illicit activity in Crypto fell by 39% in 2023.SEC head Glenson said that a lot of illicit activity like ransom ware, money laundering, etc can be done using cryptocurrencies. It is a speculative and volatile business. Cryptocurrency is also used by hackers though it fell by 50% but proceeds from drug sales rose by over 20% Hence, whenit comes to cryptocurrency, there is always a competition between businesses and scammers.Google also sued 87 apps installers who installed fraudulent app
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