businessline's State of the Economy Podcast

In this State of the Economy podcast, businessline’s Haripriya takes valuable insights from Sindhu Gangadharan SVP & MD,SAP Labs India and Vice Chairperson, nasscom, Sangeeta Gupta Sr. Vice President, and Chief Strategy Officer at nasscom, and Jagdish Mitra Head - India Business and Corporate Affairs, Tech Mahindra. Assessing India's position in the rapidly evolving global tech landscape, with a focus on artificial intelligence (AI). 

They highlight India's remarkable progress in technology, transitioning from an IT outsourcing hub to an innovation-driven ecosystem with supportive government policies.

They also acknowledge how India's tech landscape is characterised by a convergence of talent, technology, entrepreneurship, and government support. With a vibrant startup ecosystem, expanding digital infrastructure, and rising internet penetration, India has become a hotbed for tech innovation and entrepreneurship.

The discussion emphasises India's resilience amid global macroeconomic challenges, attributing it to factors like a robust and diverse economy, large consumer base, and increased urbanisation. The country's attractiveness for investment is underscored by its talent pool, growing market, and government initiatives.

Regarding the future of India's IT industry, the conversation points towards a shift towards consulting-led services and a focus on emerging technologies like generative AI. Indian IT companies are expected to invest in training and retraining their workforce to adapt to changing technological trends and meet evolving client needs.

Sangeeta emphasises the continued growth potential of the IT services industry despite global challenges, citing opportunities in areas like generative AI and European markets. Haripriya raises questions about AI's role in addressing India's unique challenges and the necessary involvement of stakeholders like companies and the government. 

Sindhu discusses India's potential as an AI hub, citing significant investments and government initiatives like the Digital India Act. She emphasises the importance of global collaborations and ethical AI regulations.

Sangeeta and Jagdish discuss the transformative potential of AI in various sectors, including healthcare and education. They highlight the need for talent development and India's progress in AI research and innovation. The discussion touches on India's position in the global AI landscape, acknowledging progress while recognising the need for further development.

Regarding policy changes, Sangeeta stresses the importance of R&D investment and simplifying regulatory processes, while Jagdish suggests creating innovation clusters to foster collaboration between industry, academia, and startups.

In this episode of State of Economy, businessline’s Shishir Kumar Sinha talks to Aditi Nayar, Chief Economist, Investment Information and Credit Rating Agency (ICRA) to dissect macroeconomic trends, exploring manufacturing growth dynamics, delving into GST collections, addressing inflation concerns, and forecasting future rate revisions. 

The podcast begins by addressing the issue of divergences between GDP and GVA. Nayar reveals the puzzling nature of recent figures, emphasising the sharp wedge between GDP and GVA growth in the third quarter of FY24. She attributes this to a significant expansion in net indirect taxes, shedding light on the implications for government finances. 

The conversation goes onto talk about the manufacturing sector, where Sinha seeks Nayar’s insights on the ongoing growth trajectory. She elucidates on the margin expansion driving manufacturing growth, cautioning about potential challenges ahead due to commodity price fluctuations. 

Discussing GST collections, Sinha and Nayar explore the factors contributing to the uptick, including compliance, consumption, and inflation dynamics. They delve into the intricacies of GST as a consumption-based taxation system, analyzing its implications for economic growth. 

Addressing inflation concerns, Nayar offers her expectations for the upcoming retail inflation numbers, emphasising the importance of factors like base effects and food price shocks. 

As the conversation concludes, Sinha and Nayar explore the prospects for future rate revisions, dissecting the implications of recent GDP data and high-frequency economic indicators. 

Host: Shishir Kumar Sinha; Producer: Amitha Rajkumar.

About the State of the Economy Podcast

India’s economy has been hailed as a bright spot amid the general gloom that seems to have enveloped the rest of the world. But several sectors continue to stutter even as others seem set to fire on all cylinders. To help you make sense of the bundle of contradictions that the country is, businessline brings you podcasts with experts ranging from finance and marketing to technology and start-ups.

In this episode of the State of the Economy podcast, businessline’s Rishi Ranjan Kala speaks to Vijayanand Samudrala, President, Amara Raja Advanced Cell Technologies, on the EV mobility movement in India.

Samudrala shares insights on India’s journey towards electrification, from its inception to the current surge in momentum. From two-wheelers to commercial vehicles, he shares how EVs are reshaping mobility across the nation.

India’s aspiration to achieve net zero emissions by 2070 hinges significantly on the success of its EV sector, necessitating a robust supply chain for lithium-ion batteries. Ambitious plans by the Amara Raja group like the establishment of a sprawling giga factory spanning 265 acres in Hyderabad with a capacity of 16 GW hours is one such move.

The podcast looks at the policy landscape driving India’s EV ambitions, spotlighting initiatives like FAME (Faster Adoption and Manufacturing of Electric Vehicles) and ACC (Advanced Chemistry Cell) PLI schemes.

The challenges of building a sustainable EV ecosystem, including policy hurdles and securing critical materials like lithium and cobalt. Samudrala offers an overall view, highlighting both the opportunities and obstacles along the way.

A crucial aspect of EV adoption is the availability of charging infrastructure. Rishi and Vijayanand discuss the importance of investing in charging stations to encourage more people to switch to electric vehicles. They discuss innovative solutions for infrastructure deployment, such as small-scale charging points tailored to India’s needs.

Listen in!

Host: Rishi Ranjan Kala; Producer: Amitha Rajkumar.

About the State of the Economy Podcast

India’s economy has been hailed as a bright spot amid the general gloom that seems to have enveloped the rest of the world. But several sectors continue to stutter even as others seem set to fire on all cylinders. To help you make sense of the bundle of contradictions that the country is, businessline brings you podcasts with experts ranging from finance and marketing to technology and start-ups.

 Using quantitative strategies in investing and risk management is one of the evolving concepts in stock markets. In this State of the Economy podcast, businessline’s Parvatha Vardhini C speaks to Siddharth Vora, Head of Investment Strategy and Fund Manager at Prabhudas Lilladher on applying quantitative techniques to investment decisions. 

Siddharth acknowledges that the markets have remained lacklustre since the beginning of the year after a stellar run in 2023. He sees this consolidation as an opportunity for investors to re-evaluate and reshape their portfolios. He anticipates a shift from mid and small caps to larger caps in the coming weeks or months.  

When asked about earnings growth predictions for 2024, Siddharth provides a nuanced view. While he acknowledges the robust growth in 2023, he expects moderation in earnings and returns going forward. He emphasises the need for a healthier outcome for investors, considering the elevated base from the previous strong performance. 

The speaker also provides a consolidated view on the quantitative strategies he uses in investing. He states that it is important to bring in a multifaceted approach in selecting stocks, encompassing analysis of sector, style, risk, liquidity, valuation, and volatility along with fundamental and technical analysis.  Siddharth introduces the concept of the 6S framework (Include Sector Rotation, Style Alignment, Superior Fundamentals, Sound Valuations, Strong Technicals, Smart Risk Management) as the foundation of their equity strategy.  

Coming to what his quant models are telling them now, the speaker discloses their avoidance of private banks, chemicals, agrochemicals and IT in the last eight months and a significant emphasis on sectors like diversified financials, industrials, and automobiles. Currently, their allocations include energy, financials, automobiles, utilities, and healthcare. This reflects an adaptive approach to changing market conditions by moving from pro-cyclicals earlier to being somewhat defensive now.

A crucial aspect discussed is the role of quantitative techniques in risk management and the key question of when to sell a stock. Siddharth elucidates their strategy for dealing with known and unknown risks. The periodic rebalancing mechanism ensures that weaker stocks are eliminated, and the portfolio adapts to new opportunities without emotional bias of a fund manager, he concludes.

Listen to the podcast now.  

(Host: Parvatha Vardhini C, Producers: Anjana PV & Siddharth Mathew Cherian)

In recent years, a significant legal tussle has emerged between domestic startups and tech giant Google over the latter’s app billing practices. 

At the heart of this dispute lies the issue of fair competition, revenue sharing, and control over app distribution channels.

The controversy — which had its genesis in year 2020–revolves around Google's imposition of a mandatory 30 percent commission on app downloads and in-app purchases made through the Google Play Store. 

While this practice has been in place for years, it has increasingly drawn criticism from domestic startups, alleging high commissions on account of monopolistic behaviour and unfair treatment. 

These startups argue that the high commission rate (which Google calls as service fee) severely impacts their profitability and ability to compete in the market.

One of the primary concerns initially raised by domestic startups is the lack of alternative app distribution channels on Android devices. Google brought some changes to its payment policy ushering in updated User Choice Billing (UCB) from April 26 last year and brought down its service fee to maximum of 26 percent from 30 percent on the in-App purchases and other App downloads.. 

Unlike Apple's ecosystem, where users can sideload apps or use third-party app stores, Android users predominantly rely on the Google Play Store for app downloads. This gives Google significant control over app distribution and monetisation, creating a perceived imbalance of power, domestic Startups argued. 

Moreover, startups argue that Google's dominance in the app market stifles innovation and limits consumer choice. The high commission (service fees) force developers to either absorb the additional costs, thereby reducing their profit margins, or pass them on to consumers, potentially making their apps less competitive in the market. This, in turn, hampers the growth of domestic startups and discourages new entrants from entering the market.

The legal battle between domestic startups and Google has taken various forms, including antitrust investigations and lawsuits, and has now reached the doors of the Supreme Court. In some cases, startups have formed coalitions to collectively challenge Google's policies and advocate for fairer terms. These efforts have garnered attention from regulators and policymakers, prompting inquiries into Google's business practices and potential violations of antitrust laws.

A notable legal showdown has been the move of 16 Startups to move Madras High Court last year against Google on its payments policy. 

With Madras High Court division bench dismissing the Startups’ appeal,  the Startups are now before the Supreme Court in appeal against the High Court order. The apex court has already refused any interim protection for domestic Startups, leaving them exposed to possible delisting actions by Google for non compliance to tech giant’s payment policy.

In approaching the apex court directly, the Startups have ignored the directions of Madras High Court to approach CCI for legal remedy. Startups have contended that CCI has not acted upon their earlier complaint of non compliance by Google on the CCI’s October 25, 2022 order in the Google Play Store case. 

CCI had on October 25, 2022 imposed fine of ₹ 936.4 crore on the tech giant and directed it to allow third party billing system to App developers; not to restrict app developers from communicating with their users to promote their apps and offerings. 

Google was also required to set out a clear and transparent policy on data that is collected on its platform, use of such data. The outcome of the ongoing legal battle  in the Supreme Court between domestic startups and Google remains uncertain, with implications that extend beyond the realm of app billing. 

Listen in to the BL State of the Economy Podcast with Competition Law Expert M M Sharma.

Host: Srivats KR; Producer: Siddharth MC.

In this episode of the State of the Economy podcast, we delve into the agricultural sector, particularly the spices market, which has experienced significant turbulence in recent years. Last year, we witnessed a surge in jeera prices, doubling due to weather vagaries. Now, turmeric prices are poised to follow suit, mirroring a similar upward trend. Other spices like coriander and dhanya are also witnessing an uptick, attributing their gains to unpredictable weather patterns affecting crop yields. 

 To shed light on the outlook for 2024, businessline’s Subramani Rao Mancombu is joined by Anu V Pai, Commodity Research Analyst, Geojit Financial Services. Pai discusses the factors influencing spice prices, highlighting the role of supply-side constraints and export demands. While turmeric prices are expected to see a rise, uncertainties loom over jeera prices, impacted by increased production in key States. 

 As we navigate through the harvesting season and monitor export and festive demands, the trajectory of spice prices remains uncertain. Listen in to know more.  

Host: Subramani Ra Mancombu; Producer: Nabodita Ganguly

About the State of the Economy Podcast

India’s economy has been hailed as a bright spot amid the general gloom that seems to have enveloped the rest of the world. But several sectors continue to stutter even as others seem set to fire on all cylinders. To help you make sense of the bundle of contradictions that the country is, businessline brings you podcasts with experts ranging from finance and marketing to technology and start-ups

The government had pledged to allocate 25 per cent of the R&D budget for private industry in defence manufacturing in the 22–23 budget. Despite this promise, 25 months later, the fund has not been made available to the industry which is key to big ticket innovations in strategic domain.  

In this State of the Economy podcast hosted by businessLine’s Dalip Singh, JD Patil -- an industry veteran and member of the executive council of Management of L&T, and Advisor to the CEO & MD for L&T’s Defence & New Age Smart Technology businesses -- shares his candid views on this issue as well as expresses reservation over Ministry of Defence indulging in nomination of procurement orders.  

He discusses the significance of this R&D allocation for the defence sector, emphasising its potential impact on innovation and industry growth. Additionally, Patil touches upon the recent announcement of 100 per cent FDI in space and reflects on the progress made in defence reforms over the past decade. However, he highlights the challenges faced in translating these reforms into tangible outcomes, particularly regarding the regulation of defence orders and the implementation of R&D funding for private players.  

Patil also addresses concerns regarding DRDO's functioning, emphasising the need for transparency and accountability in defence projects. Moreover, he discusses L&T's role in defence manufacturing, including its involvement in submarine projects and efforts to enhance India's MRO capabilities. Despite facing obstacles such as competition from foreign players and regulatory hurdles, L&T remains committed to contributing to India's defence sector and expanding its global presence. He also adds that the company’s order book as of today is “more than 20,000 crores, and we hope to be closing the year by making it better.”  

The discussion also delves into the significance of countering space capabilities, highlighting the evolving nature of threats in space and the need for situational awareness. Patil says, “The bigger threat in the case of space objects is not about whether China will knock off our satellites or whether we'll knock off Chinese satellites." The bigger threat today is if I can hack your satellite.”  

 The conversation stretched over the necessity for capabilities to address threats in this intermediate space, highlighting the importance of technologies like theatre fighting capabilities and ballistic missile defence systems, including the Russian S-400. The emphasis shifts to the significance of safeguarding satellites against cyber threats, recognising the vulnerability of space assets to hacking. He also admits to global conflicts impacting defence business here. Listen in. 

Host: Dalip Singh, Producer: Nabodita Ganguly

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About the State of the Economy podcast 

India’s economy has been hailed as a bright spot amid the general gloom that seems to have enveloped the rest of the world. But several sectors continue to stutter even as others seem set to fire on all cylinders. To help you make sense of the bundle of contradictions that the country is, businessline brings you podcasts with experts ranging from finance and marketing to technology and start-ups 

In this episode of the State of Economy Podcast, Chitra Narayanan, Shiv Shivakumar, operating partner at Advent International, and Naresh Gupta, co-founder and managing partner of Bang in the middle, a full-service independent creative agency, discuss the use of celebrities in advertising.  

Despite the risks involved, such as overexposure and lack of effectiveness, brands continue to invest heavily in celebrity endorsements. The recent Super Bowl commercials serve as a prime example of this phenomenon. 

Shivakumar begins by highlighting the empirical evidence suggesting that celebrity endorsements often yield similar results to non-celebrity advertisements. However, he emphasises that many brands still cling to the notion that celebrities guarantee success. He provides historical context, tracing the origins of celebrity advertising back to Ginger Rogers' endorsement of Lux soap. 

Gupta echoes Shivakumar's sentiments, adding that while their agency has utilised celebrities in campaigns, they do so with careful consideration and purpose. He critiques the prevailing trend of indiscriminate celebrity usage driven by vanity and laziness within marketing teams. 

The conversation looks into the commoditisation of celebrity endorsements, citing examples of celebrities endorsing numerous brands simultaneously, leading to brand dilution and consumer confusion.  

The podcast also touches upon the narrow definition of celebrities in India, dominated by cricketers and film stars, overlooking potential endorsers from other fields. 

Both Shiv and Naresh caution against gimmicky marketing stunts such as those done by Poonam Pandey and emphasise the importance of aligning celebrities with the core values of the brand.  

But there have been good examples of brands and celebrities benefitting through an association. For instance, long-term partnerships between brands and celebrities, such as Shahrukh Khan's association with Hyundai and Aamir Khan's collaboration with Coke to cite a few. 

Listen in to know more! 

In this episode of the State of the Economy podcast, businessline’s Raja Simhan talks to Ajay Singh, a board member of Mitsui OSK Lines, about the significance of LNG transport amidst geopolitical challenges, including the ongoing conflict between Russia and Ukraine, as well as tensions in the Red Sea region and the Hamas-Israel conflict. 

Singh provides valuable insights into how these geopolitical dynamics affect the movement of energy resources, particularly LNG, to India. 

The discussion delves into Mitsui OSK Lines' recent LNG deal with GAIL, one of India's leading natural gas companies, shedding light on the intricacies of LNG transportation and the company's role in facilitating the movement of LNG from the United States to India. The podcast goes onto explain the challenges and opportunities in India's LNG market, including the growing demand for natural gas and the government's push to increase the share of gas in the energy mix. 

The conversation also touches upon broader issues such as sustainability and the transition to green energy, with Singh highlighting the potential of green hydrogen production in India and its implications for the shipping industry. The episode offers a comprehensive exploration of the economic, geopolitical, and environmental factors shaping India's energy landscape. 

Host: Raja Simhan, Producer: Amitha Rajkumar

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About the State of the Economy podcast 

India’s economy has been hailed as a bright spot amid the general gloom that seems to have enveloped the rest of the world. But several sectors continue to stutter even as others seem set to fire on all cylinders. To help you make sense of the bundle of contradictions that the country is, businessline brings you podcasts with experts ranging from finance and marketing to technology and start-ups 

In this State of the Economy Podcast, Subramani Ra Mancombu and Jatin Trivedi, Vice President and Research Analyst at LKP Securities, talk about the precious metals landscape, interest rates, and their impact on global markets. 

Trivedi helps explain the world of gold, silver, and other precious metals, giving insights into why their prices move, what factors drive them, and what to expect in the future. 

He attributes recent fluctuations in gold prices to factors such as varying interest rates and speculation to geopolitical tensions. He touches upon the role of the US Federal Reserve and global economic indicators in shaping market sentiment, providing listeners with a deeper understanding of the forces at play. 

Trivedi also talks about the complexities of the Indian gold market, on currency dynamics, geopolitical developments, and domestic demand. 

Regarding silver, Trivedi paints a picture of bullish prospects, highlighting the metal's unique position amid broader market trends. Given the context of base metal cycles and anticipated shifts in interest rates, he presents a case for silver as an attractive investment opportunity in the months ahead.