Activities out in the sticks may add more to GDP than was thought … India’s villages and towns, far from the gaze of foreigners and the urban elite, have been on a tear. Over the past decade new roads have been built. Almost everybody these days has a mobile phone. Electricity has become more common, as have computerised land records. Fewer people have to spend time collecting firewood, using bottled gas instead. New houses built with walls and floors of brick or cement are more durable than wooden huts, and need less maintenance. … It means people can turn their energy to starting businesses and escaping subsistence farming. Poultry production is booming, as it has become easier to get chickens to market. Villagers eat more processed food—India’s artery-clogging pudding, gulab jamun, now comes in packets, made in small factories in nearby towns. Better communications are vital. … A bigger economy is good news, but it raises two questions. First, can the informal economy be insulated from the problems affecting the rest of India? … The second question is how swiftly India can bring its black economy into the daylight.
The world is about to experience an unprecedented consumption boom, which presents both challenges and opportunities for investors everywhere. Animal protein consumption, energy, air travel, health care, and education are some of the most relevant sectors involved as the upcoming changes in population and income collide. ... The world in general—and India in particular— is in the midst of a fascinating transition right now. Taking a step back from our day-to-day focus to view the bigger picture can offer a different perspective on the dynamics of various countries in a volatile and uncertain world. Envision a map that is drawn to represent how economists view the world. Imagine a map on which the area occupied by a country as a percentage of total area is equivalent to its percentage of global GDP. Compared with traditional maps, in which country sizes are based on land area, the United States, Europe, and definitely Japan would appear bloated. Other regions would look smaller—for example, Africa or India. Africa especially is quite difficult to see on the economists’ map. ... Now, imagine another map on which land area is proportionate to the country’s percentage of the global population. If the United States is viewed this way, it will be much smaller than on the economists’ map. In the population map, Africa would become relevant and uncertainties about the importance of India and China would disappear. Focusing on the differences in these maps may permit us to realize our biases in viewing the world.
“Fire left,” instructs Pederson. Mistry flips a switch on the center console and deploys a flare on the left wing. “Fire right.” There are 24 cylinders resembling sticks of dynamite wired to racks on the plane’s wings, 12 on each. The flares are filled with combustible sodium chloride—pulverized table salt mixed with a flammable potassium powder. When the switch is flipped, the end of the flare shoots orange fire and trillions of superfine salt particles are released into the cloud. Water molecules are attracted to salt, so they bond to the particles and coalesce into raindrops. ... During our mission over Maharashtra, we have cooperative clouds. Twenty-two minutes after seeding the first cloud, Pederson returns to the location where he fired that initial flare. It’s pouring. “We’ve got drops!” he shouts. He dips the King Air into a victory swoop before gunning over to another cluster of clouds. My stomach churns, and I can’t hold it in any longer; I heave into my purse. Pederson doesn’t notice. The computer barks out another warning about excessive banking. He laughs and says, “Shove it, Betty.” ... Cloud seeding has been controversial since it was invented by Vincent Schaefer in 1946. A chemist for General Electric, Schaefer made the first snowstorm in a laboratory freezer. The media predicted that cloud seeding could perform miracles, from dousing forest fires to ensuring white Christmases. But doubts quickly arose about the impact of meddling with nature. Concerns that cloud seeding might “steal” water from an area a cloud is traveling toward—robbing Peter to water Paul, as it were—have been dispelled. Storm clouds continually regenerate and release only a portion of their moisture when they rain, which means you can’t “wring out” all the moisture from one cloud.
Coal? Or the Sun? The power source India chooses may decide the fate of the entire planet. ... Already Earth’s fastest-growing major economy and its biggest weapons importer, India is on track to become the world’s most populous nation (probably by 2022), to have its biggest economy (possibly by 2048), and potentially to build its biggest military force (perhaps by 2040). What China was in the American imagination in the 1990s and 2000s, India will be in the next two decades—a cavalcade of superlatives, a focus of fears. ... officials and academics have long argued that Western nations are demanding that India industrialize without burning even a fraction of the fossil fuels that developed nations consumed when they industrialized. And Indians resent that Western nations insist on the right to judge Indian performance while refusing to help with the cost of transition. ... India’s demand for electricity is widely expected to double by 2030. …= Soon after being elected prime minister in 2014, he announced that India would produce 100 gigawatts of solar power by 2022 (the US now has about 20 gigawatts). ... To generate electricity from it, India plans to build 455 new coal-fired electric power plants, more than any other nation—indeed, more than the US now has. (India’s existing 148 plants, which provide two-thirds of its electricity, are among the world’s dirtiest and most inefficient.)
In pulling back the curtains, Amazon, one of the most private public companies in the world, revealed how it is racing to piece together an immensely complex puzzle—much of which it is having to build from scratch, at giant expense and with painstaking attention to the minutiae, as it tosses out assumptions that American customers have taken for granted for decades. In doing so, the company, an upstart here, has thrown itself into a knife fight with two privately owned and much more established Indian competitors—Flipkart Internet Pvt. and Snapdeal, owned by Jasper Infotech Pvt.—as well as a clutch of smaller Indian startups that are nipping at all of their heels. ... It is a fight that Amazon is far from certain of winning, yet one it cannot afford to sit out. The company predicts that India will be its biggest market after the U.S. within a decade and that the Indian e-commerce market as a whole will ultimately be gigantic. ... It is not hard to see why the battle for India is this fierce, nor why Bezos, famously obsessed with analytics, would see it as essential for Amazon’s future. The numbers alone are dizzying. India’s population of 1.25 billion is four times as big as the U.S.’s and more than double Europe’s. And since the median age is 27—a full decade younger than Americans’—the trajectory will be steep. India will overtake China as the world’s most populous country in just seven years, according to the UN. It is now the world’s fastest-growing major economy, and the IMF projects 7.5% growth next year. The roads and railways might be creaking under the strain. Many laws governing business are a confounding tangle, including a law forbidding foreign companies from selling products directly to Indians. That law effectively renders Amazon India a platform for vendors—akin to its “fulfillment by Amazon” program in the U.S. ... Barely one-quarter of India’s population has access to the Internet at home, whether on a smartphone or computer, and only a small fraction of those have ever shopped online. ... By some estimates the company is spending nearly $25 million a month in India already.
The frenzied, fanatical politics of Tamil Nadu, India. ... Before she went into politics, Jayalalithaa was the most popular Tamil movie actress of her time, the heroine in more than 100 films. She followed the model of her mentor and co-star, an actor-politician named Marudhur Gopalan Ramachandran but more commonly known by his initials M.G.R. He ruled Tamil Nadu for 11 years, and since his death in 1987, Jayalalithaa and her archenemy, a wily 92-year-old screenwriter named Muthuvel Karunanidhi, have taken turns running the state. As the head of the D.M.K. — the party to which M.G.R. belonged until their rivalry forced a split — Karunanidhi has built a cult following on par with Jayalalithaa’s. The two of them rule as if in a melodrama, having each other arrested, dropping snide insults and wild accusations, destroying each other’s pet projects. The D.M.K. and the A.I.A.D.M.K. have almost no policy differences, but no other party can gain a foothold.
Somewhere between a fifth to a third of the million students graduating out of India's engineering colleges run the risk of being unemployed. Others will take jobs well below their technical qualifications in a market where there are few jobs for India's overflowing technical talent pool. Beset by a flood of institutes (offering a varying degree of education) and a shrinking market for their skills, India's engineers are struggling to subsist in an extremely challenging market. … According to multiple estimates, India trains around 1.5 million engineers, which is more than the US and China combined.
The U.S. government has moved quietly and aggressively to prevent undocumented Indians from entering the United States, many of whom are Sikhs fleeing political repression or economic collapse at home. ... The number of Indian nationals caught trying to cross the southern border into the U.S. exploded suddenly in 2010, growing sixfold to 1,200 from just over 200 the year prior. ... Although the number has oscillated since then, it has remained near an all-time high. And that includes only those caught trying to cross undetected, leaving out Buta Singh and others like him — thousands, mostly young men, who walk up to a border crossing, turn themselves in, and plead asylum. The total number of Indian nationals who tried to enter the U.S. without papers, including through airports and other points of entry, also spiked in the last five years, peaking at close to 13,000 in 2013, more than double the number in 2009. ... Much of this influx, according to dozens of interviews with immigrants, experts, and current and former immigration officials, comes from young Indian men at the border, ferried there by transnational smuggling networks. Although border authorities do not track the religious or regional origins of migrants, government officials and other observers say that large numbers of the new arrivals are Sikhs from Punjab, a region in northwestern India beset by economic collapse and environmental degradation, a major drug epidemic, and decades of what human rights groups describe as political violence carried out with impunity.
He bounces from smart locks, to smart lights, to a smart shower, to smart shoe insoles. It almost backfires when a Samsung representative demonstrating a smart refrigerator reaches out and flips his badge back over, asking, “What are you, press?” But his name doesn’t mean anything to her, and Pichai just casts an amused sideways glance and dives in with questions. “So, what can I ask the fridge?” he wants to know. Various versions of this same scene play out again and again. ... With $74.5 billion in annual revenue last year, Google is by far the largest (and only profitable) business under Alphabet. Indeed, Google has seven different products that more than a billion people use: Search, Gmail, YouTube, Android, Chrome, Maps, and its app and media vending machine, the Google Play Store. ... Google is sprinting to attract its “next billion” users. For the most part, these are people in the developing world; people who will go online, for the very first time, using one of Google’s Android-powered handsets. Which puts Google in the position of being seen as both a corporate NSA and modern East India Company. ... Android was, very literally, made for this moment. Its entire point is to be customized, reconfigured, and personalized for a world full of people across a range of sizes, shapes, configurations, and price points. Sure, signs for the $550 Nexus abound, but you can also score a cheap Android phone in Delhi, like a Lava Atom X, for less than $40 — and that’s without a contract. It will, Pichai thinks, change the status quo not just in India, but the entire world.
Given the importance of spillovers from monetary policies, especially in the face of globally low inflation, it is important we start building a global consensus on how to get better outcomes for the world. Nevertheless, with economic analysis of these issues at an early stage, it is unlikely we will get strong policy prescriptions soon, let alone international agreement on them, especially given that a number of country authorities like central banks have explicit domestic mandates. ... This paper therefore suggests a period of focused discussion, first outside international meetings, then within international meetings. Such a discussion need not take place in an environment of finger pointing and defensiveness, but as an attempt to understand what can be reasonable, and not overly intrusive, rules of conduct. ... As consensus builds on the rules of conduct, we can contemplate the next step of whether to codify them through international agreement, see how the Articles of multilateral watchdogs like the IMF will have to be altered, and how country authorities will interpret or alter domestic mandates to incorporate international responsibilities. ... The international community has a choice. We can pretend all is well with the global financial non-system and hope that nothing goes spectacularly wrong. Or we can start building a system for the integrated world of the twenty first century.
Nestlé, the world’s largest food and beverage company, has sold Maggi (pronounced “MAG-ee”) in India for more than 30 years, and the brand’s ubiquity and cultural resonance on the subcontinent is something akin to Coca-Cola’s in the U.S. In 2014, Indians consumed more than 400,000 tons of the instant noodles—marketed in 10 varieties, from Thrillin’ Curry to Cuppa Mania Masala Yo!—and Maggi accounted for roughly a quarter of the company’s $1.6 billion in revenue in the country. That year Maggi was named one of India’s five most trusted brands. ... On June 5, 2015, less than a month after Khajuria’s phone rang in the middle of the night, India’s central food regulator announced a temporary ban on the manufacture, sale, and distribution of Maggi noodles. In its order the FSSAI pronounced Maggi “unsafe and hazardous for human consumption,” a designation supported by 30 government lab tests showing Nestlé’s noodles contained excess amounts of lead. ... The Maggi meltdown would prove costly. Nestlé lost at least $277 million in missed sales. Another $70 million was spent to execute one of the largest food recalls in history. Add the damage to its brand value—which one consultancy pegged at $200 million—and the total price tag for the debacle could easily be more than half a billion dollars. And the fallout continues. ... Nearly a year after the ban, Maggi noodles are back on shelves in India, but somewhat precariously so. The product’s future depends on two legal cases that are working their way through the Indian court system. Both pit Nestlé against the Indian government.
In the next 15 years India will see more people come online than any other country. Last year e-commerce sales were about $16 billion; by 2020, according to Morgan Stanley, a bank, the online retail market could be more than seven times larger. Such sales are expected to grow faster in India than in any other market. This has attracted a flood of investment in e-commerce firms, the impact of which may go far beyond just displacing offline retail. ... India’s small businesses have limited access to loans; most of its consumers do not have credit cards, or for that matter credit. The e-commerce companies are investing in logistics, helping merchants borrow and giving consumers new tools to pay for goods. ... Amazon wants to make India its second-biggest market, after America. For the time being, though, with just 12% of the market, it lags behind the home-grown successes, Flipkart (45%) and Snapdeal (26%). All three, as well as some smaller competitors, are spending at a blistering rate. ... The prospect of a second market growing to a near-Chinese size attracts those who made a packet the first time round. ... Indian regulations bar foreign-backed e-commerce firms from owning inventory, and so acting as a straightforward retailer is not an option. As a result India’s top e-commerce companies look much more like Alibaba.
At home, before he gave the present to his wife, Muruganantham took out one of the pads and tore it open. As a kid, he had always been driven by an extraordinary curiosity to find out how things worked; he would compulsively dismantle any new thing he could lay his hands on — toys, bicycles, radios. Muruganantham expected to see something interesting inside the pad, especially because of how furtively the shopkeeper had handed him the pack, but the innards seemed to be nothing but compressed cotton. He wondered why 10 grams of cotton — costing barely a 10th of a rupee — was being sold for a price that was beyond the reach of 90 percent of Indian women. ... economic constraints have driven India’s government and industries to create cheaper versions of many Western products and technologies. India’s pharmaceutical companies have for many years been a major supplier of cheap generic drugs domestically as well as in other developing countries. In 2014, when the Indian Space Research Organization’s Mangalyaan spacecraft entered into orbit around Mars, a few days after a NASA probe did the same, the most-talked-about difference between the two missions was that Mangalyaan had cost about a 10th of what NASA had spent.
It’s been six years since we first wrote about the coming G-Zero world—a world with no global leader. The underlying shifts in the geopolitical environment have been clear: a US with less interest in assuming leadership responsibilities; US allies, particularly in Europe, that are weaker and looking to hedge bets on US intentions; and two frenemies, Russia and China, seeking to assert themselves as (limited) alternatives to the US—Russia primarily on the security front in its extended backyard, and China primarily on the economic front regionally, and, increasingly, globally. ... These trends have accelerated with the populist revolt against “globalism”—first in the Middle East, then in Europe, and now in the US. Through 2016, you could see the G-Zero picking up speed ... with the shock election of Donald Trump as president of the US, the G-Zero world is now fully upon us.
1. Independent America: Trump rejects the comparative weakness of the presidency, and he wants to more directly project American power in service of US national interests
2. China overreacts: Xi will be extremely sensitive to external challenges to his country’s interests at a time when all eyes are on his leadership
3. A weaker Merkel: Could the Europeans have resolved their financial crises without the Germans forcing a solution?
4. No reform: The reform needle won’t move in 2017. Save for a few bright spots, money won’t know where to flow
5. Technology and the Middle East: Technology, a force for economic growth and efficiency, also exacerbates political instability
6. Central banks get political: In the US, there’s risk of an open conflict between the Federal Reserve and the White House
7. The White House versus Silicon Valley: Technology leaders from California, the major state that voted in largest numbers against Trump in the election, have a bone to pick with the new president
8. Turkey: Ever-fewer checks on executive power will leave the private sector vulnerable to political whims
9. North Korea: It’s making consistent progress on an intercontinental ballistic missile capability that would allow it to hit the West Coast of the US with a nuclear weapon
10. South Africa: South Africa’s political infighting will undermine the country’s traditional role as a force for regional security
Red Herrings: US domestic policy, India versus Pakistan, Brazil
This is the Tata long familiar to Indians and business watchers around the world: a group that tied itself to the principles of public service and humane treatment of workers and communities, a century before “corporate social responsibility” became a buzzword. ... Since Jamsetji set up his small trading company in 1868, it has expanded into a major name in global business, with annual turnover exceeding $100bn. Even amid this huge growth, it retained a name for stable leadership: in the first 144 years after it was founded in Mumbai, the group had only five leaders, all drawn from Jamsetji’s descendants. ... But this carefully guarded reputation for ethics and stability, a source of pride for Tata’s 660,000 employees and India itself, is now threatened by an unprecedented crisis. The upheaval began in October last year when Cyrus Mistry, the first chairman drawn from outside the founding family, was suddenly dismissed without explanation, exposing seething tensions between him and his predecessor Ratan Tata.
The world is about to experience the greatest geopolitical transformation in at least the past three generations. The United States’ need for oil has greatly diminished, and its goals in the Middle East have changed. The United States now views the world wholly in relation to its other interests. Global and local demographics, new outsiders in the area, and a new contest shaping up between Iran and Saudi Arabia contribute to continuing instability in the Middle East. A global energy crisis could soon draw many countries into the Middle East, and a simultaneous political crisis could erode state authorities there, unleashing a new wave of violence and terrorism. ... The United States is transforming into a country with global reach but no global interests. For the 4 billion people on this planet who are utterly dependent on global trade for their well-being, this transformation is possibly the worst outcome imaginable. ... Even if the United States was convinced that its economic and physical security required international engagement, it is about to step out to lunch, and it is going to be a very, very long lunch. Just as the rest of the world needs the United States, it is leaving the building.
In the industrialized world, the power grid is so reliable that we take it for granted. But in India, where blackouts are a sad fact of daily life, being connected to the grid is no guarantee of reliable electricity. In a 2015 study of villages in six Indian states [PDF], for example, the vast majority reported having fewer than 4 hours of electricity per day; nearly half of the households that reported having a grid connection nevertheless had effectively no electricity. Chief among the reasons they cited were poor reliability, quality, and affordability. In many parts of the country, even middle-income households still find themselves held hostage to frequent power cuts that can last anywhere from a few hours a day to most of the day. Those who can afford to often install diesel generators, an expensive and polluting option. ... Then, too, roughly a quarter of a billion Indians, or one-fifth of the population, live without access to any electricity at all ... The Indian government has taken a traditional approach to electrification, which focuses on building up generation, transmission, and distribution. But there’s a better way that’s more affordable, more efficient, and much faster and easier to deploy.
Bangalore has a problem: It is running out of water, fast. Cities all over the world, from those in the American West to nearly every major Indian metropolis, have been struggling with drought and water deficits in recent years. But Bangalore is an extreme case. Last summer, a professor from the Indian Institute of Science declared that the city will be unlivable by 2020. He later backed off his prediction of the exact time of death—but even so, says P. N. Ravindra, an official at the Bangalore Water Supply and Sewerage Board, “the projections are relatively correct. Our groundwater levels are approaching zero.” ... Every year since 2012, Bangalore has been hit by drought; last year Karnataka, of which Bangalore is the capital, received its lowest rainfall level in four decades. But the changing climate is not exclusively to blame for Bangalore’s water problems. The city’s growth, hustled along by its tech sector, made it ripe for crisis. ... Through the 2000s, Bangalore’s urban landscape expanded so quickly that the city had no time to extend its subcutaneous network of water pipes into the fastest-growing areas, like Whitefield. Layers of concrete and tarmac crept out across the city, stopping water from seeping into the ground. ... 44 percent of the city’s water supply either seeps out through aging pipes or gets siphoned away by thieves. ... Everywhere, the steep ascent of demand has caused a run on groundwater. Well owners drill deeper and deeper, chasing the water table downward as they all keep draining it further. The groundwater level has sunk from a depth of 150 or 200 feet to 1,000 feet or more in many places.
Sand covers so much of the earth’s surface that shipping it across borders—even uncontested ones—seems extreme. But sand isn’t just sand, it turns out. In the industrial world, it’s “aggregate,” a category that includes gravel, crushed stone, and various recycled materials. Natural aggregate is the world’s second most heavily exploited natural resource, after water, and for many uses the right kind is scarce or inaccessible. In 2014, the United Nations Environment Programme published a report titled “Sand, Rarer Than One Thinks,” which concluded that the mining of sand and gravel “greatly exceeds natural renewal rates” and that “the amount being mined is increasing exponentially, mainly as a result of rapid economic growth in Asia.” ... Geologists define sand not by composition but by size, as grains between 0.0625 and two millimetres across. Just below sand on the size scale is silt; just above it is gravel. Most sand consists chiefly of quartz, the commonest form of silica, but there are other kinds. Sand on ocean beaches usually includes a high proportion of shell pieces and, increasingly, bits of decomposing plastic trash ... Sand is also classified by shape, in configurations that range from oblong and sharply angular to nearly spherical and smooth. Desert sand is almost always highly rounded, because strong winds knock the grains together so forcefully that protrusions and sharp edges break off. River sand is more angular. ... Aggregate is the main constituent of concrete (eighty per cent) and asphalt (ninety-four per cent), and it’s also the primary base material that concrete and asphalt are placed on during the building of roads, buildings, parking lots, runways, and many other structures. A report published in 2004 by the American Geological Institute said that a typical American house requires more than a hundred tons of sand, gravel, and crushed stone for the foundation, basement, garage, and driveway, and more than two hundred tons if you include its share of the street that runs in front of it. A mile-long section of a single lane of an American interstate highway requires thirty-eight thousand tons.
In February he was installed as chairman of Tata Sons, the private holding company that controls TCS and hundreds of other businesses that make up the Tata Group, India’s largest and most venerable conglomerate—one that owns Western brands such as Land Rover and Tetley Tea. His appointment as chairman (which at Tata is essentially the CEO role) followed an abrupt board decision last October to sack Tata Sons’ previous chairman, Cyrus Mistry, a scion of the family that remains Tata’s largest private shareholder. ... Colleagues and investors hope Chandra can transfer to the rest of Tata some of the digital magic he sprinkled on TCS, where he tripled sales and profits during his seven years as CEO. But, as one might expect of a relentless marathoner, Chandra himself suggests that whipping Tata into shape will involve some grueling workouts. ... In an April town hall with executives from Tata companies, he stressed the importance of group unity and collaboration with a slide deck touting the virtues of “One Tata.” But in other meetings, that message has been twinned with a warning that the group must have clearer lines of accountability, and that Chandra will establish detailed metrics to evaluate the performance of the various operating companies.