businessline's State of the Economy Podcast

In this episode of the State of the Economy podcast, Prashant Vasisht, Senior VP and Co-Group Head, Corporate Ratings, ICRA Limited, joins businessline’s Rishi Ranjan Kala to talk about how India’s natural gas story is progressing post-introduction of the Kirit Parikh formula, which addressed the pricing of natural gas produced in the country.

Vasisht highlights how events like the Russia-Ukraine conflict have impacted global markets and sent liquefied natural gas (LNG) spot prices soaring. This led to increased prices for gas produced from legacy fields in India. The conversation delves into the implications of these price fluctuations on various sectors, such as oil and gas, fertilisers, petrochemicals, and chemicals. It also explores the impact on industries like automobiles, especially those relying on compressed natural gas (CNG), and the city gas distribution sector. The Indian government's ambitious plans for expanding city gas distribution are also discussed.

Vasisht provides insights into India's domestic gas production and consumption trends, emphasising the expected increase in domestic production in the coming years. He also discusses India's efforts to secure long-term gas contracts to meet its growing demand.

Kala and Vasisht’s conversation touches on how the shift to EVs poses challenges for CNG suppliers. Balancing both options amid financial constraints and growing EV adoption is complex. Public transport corporations invest in EVs, potentially impacting CNG’s market share as EVs become more cost-effective. This transition presents a complex challenge in the transportation sector.

The podcast also explores India's investments in floating storage and regasification units (FSRUs) for LNG imports, considering the global competition for such vessels. The challenges of expanding LNG infrastructure and the need for further development are addressed.

Finally, the podcast addresses the government's goal of increasing the share of gas in the energy mix to 15 per cent. Vasisht highlights the challenges, including infrastructure expansion, regulatory hurdles, taxation issues, and the need for uniform policies to promote gas consumption across various sectors. Listen in!

(Host: Rishi Ranjan Kala, 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 the Economy” podcast, Subramanian Ra Mancombu, Head, Agri-biz and Commodities, businessline and CA Aditya Sesh, a member of the expert committee in the Ministry of Agriculture and Farmers Welfare, Government of India discuss the challenges faced by Indian agriculture, including the impact of climate change events over the past few years.

Climate change has significantly affected agricultural production in India, particularly in food grains and pulses. India banned wheat exports and curbed rice exports due to these challenges. Prices of pulses have surged in recent months, and abnormal southwest monsoon patterns have added to the woes. The deficiency in monsoon rainfall, while partially addressed by September rains, has still raised concerns.

Sesh emphasizes the interconnectedness of all markets, from production to consumer markets, and the need to view them holistically. He discusses the integration of traditional physical mandis with virtual platforms like eNAM and ONDC, transforming Indian agriculture into an industry.

Regarding the upcoming crop season, Sesh expresses optimism about wheat production but highlights concerns about pulses, anticipating potential shortages. He also touches on the impact of El Nino on Indian agriculture and the global issues affecting food supply, such as the Ukraine-Russia wheat dispute.

The accuracy of crop assessments in India is questioned, with Sesh acknowledging data entry challenges and efforts to improve data quality. He also discusses the use of technology like drones, satellite imagery, and IoT in enhancing data collection and production estimation.

The conversation delves into the pricing of agricultural products and measures to ensure affordability while supporting farmers. Sesh emphasizes the shift from food security to nutritional security and the growing demand for pulses and proteins in India.

Finally, the discussion expands to the idea of a global agriculture strategy for India, involving agriculture production in other countries. Sesh suggests that India should explore opportunities for agriculture expansion beyond its borders, similar to strategies adopted by China and Saudi Arabia.

Listen in!

(Host: Subramani Ra Mancombu, Producer: Jayapriyanka J)

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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

Many stocks in the mid- and small-cap space have surged sharply over large-caps in the last year. 

In this episode of the "State of the Economy " podcast, businessline's Parvatha Vardhini C talks to Vinit Sambre, Head Equities at DSP Mutual Fund, who knows this space well, about the outlook for mid-and small-cap stocks.

In the podcast, Sambre attributed the rally in these stocks to a surge in liquidity and more high-net-worth individuals entering the space and said that ultimately, if earnings growth doesn't match up to the expectation, there could then be a reality check for these stocks. He advised investors in this segment to have a long-term investment perspective. He also cautioned them about investing in microcap companies, which are known for their higher volatility. 

Though many passive fund launches have happened in the small-cap segment, Sambre advocated for actively managed in this space, asserting that select companies have the potential to outperform indices in the long run. 

Listen to this podcast to get a comprehensive understanding of the complexities and opportunities in the mid- and small-cap space.

(Host: Parvatha Vardhini C; Producers V Nivedita)

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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, Shantanu Bhadkamkar, Immediate Past President, Association Of Multimodal Transport Operators Of India, discusses the importance of multimodal transport and the need for seamless infrastructure to reduce logistics costs in India. The conversation underscores the potential for India to become a trillion-dollar economy by investing in global-scale logistics infrastructure.

Shantanu Bhadkamkar highlights that India should focus on creating global-scale logistics infrastructure to support its growing economy. He suggests that states should compete to establish such infrastructure and cites examples from countries like Switzerland and Singapore that have successfully implemented multimodal transport systems.

Moreover, he addresses the issue of high logistics costs in India and proposes a targeted approach to optimize logistics operations, industry by industry, region by region, tailoring solutions to the specific needs of each sector.

Join us in this insightful conversation to learn more about the potential and challenges of multimodal transport and how it can contribute to India's journey toward becoming a trillion-dollar economy.

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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 hosted by businessline’s Dalip Singh, former Defence Secretary Ajay Kumar, an expert in technology for governance solutions, provides valuable insights into India's defence industry, reforms, and geopolitical challenges.  

Kumar highlights the significant progress in India's defence industry, with new private companies and startups entering the sector.  

However, he emphasises that these developments are just the beginning of India's journey towards becoming a significant player in the global defence ecosystem.  To reach this pinnacle, he identifies several areas requiring fundamental reforms:

 The discussion also touches upon concerns raised by the defence industry regarding taxation, protection periods, and supply chain structures. Kumar emphasises the importance of addressing these issues and ensuring that the defence sector remains vibrant and competitive. 

Regarding the defence budget, Kumar indicates that there has been substantial growth in defence allocations in recent years, and he believes that legitimate defence requirements will continue to be met. 

On the issue of the ongoing border tensions with China, Kumar highlights India's firm response and readiness to protect its interests. He emphasises the importance of dialogue and adherence to principles of non-aggression. The podcast concludes with a discussion on India's role in promoting global peace and the need for diplomatic solutions to international conflicts.  

(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.

There has been a remarkable surge in demand for luxury cars, especially among individuals aged 35 to 40. Over the past two years, the purchasing power of these buyers has grown exponentially. Even with luxury cars starting at around ₹50 lakhs, many buyers are not hesitating to spend more, with some even crossing the ₹ 1 crore mark.

In this State of The Economy podcast, Ronendra Singh talks to Santosh Iyer, the Managing Director and Chief Executive Officer of Mercedes-Benz India, to understand the nuances of the luxury car market in India.

They delve into various aspects, ranging from the sedan vs. SUV preference to the impact of fuel choices, taxation issues, and the growing popularity of luxury electric cars, especially among environmentally conscious consumers.

As the festive season kicks off, Santosh shares his perspective on the current market performance and what to expect in the coming months. He highlights that the demand for luxury cars is on the rise, with customers eagerly awaiting deliveries during the festive period, projecting robust growth compared to the previous year.

The conversation also delves into the role of electric vehicles (EVs) in the luxury car segment and the shifting demographics of buyers. Santosh emphasises that it’s not just about age; it’s about the mindset of buyers who seek technology, sustainability, and pride in owning EVs.

The conversation shifts towards SUVs and the availability of different options, revealing that the SUV segment is gaining traction. Santosh sheds light on the ratio of SUVs to sedans and the continued demand for diesel engines in luxury cars, emphasizing the benefits they offer.

The discussion touches on government policies, including biofuels and EV incentives, and the potential impact of new entrants like Tesla in the Indian market. Santosh believes Tesla’s arrival will accelerate EV awareness but notes that they cater to different segments.

Finally, Santosh addresses the impact of higher interest rates on luxury car buyers and the industry’s efforts to provide competitive financing options. 

Read the full interview here

Ranking 7th globally in terms of funding, the Indian space startup sector has seen significant funding growth, from Rs 28 million in 2020 to Rs 112 million in 2022, with Rs 62 million invested in the first half of the current year. This surge can be attributed to increased demand for space-based solutions, cost-effective satellite manufacturing, reduced launch costs, and advancements in supporting technologies like AI and 3D printing.

Public-private partnerships are driving growth in the space sector. Initiatives like privatisation of launch vehicles and collaborations with private companies are expanding opportunities. Government policies, such as the exception to GST, have further incentivised private space enterprises.

The podcast also delves into the potential benefits of the Production-Linked Incentive (PLI) scheme for the space sector, encouraging foreign companies to set up operations in India and enhancing the country’s capabilities in critical areas like satellite technology.

Despite the sector’s promise, challenges remain. Limited investor interest at later stages of development is a concern, and the talent pool for space tech startups needs to grow. Policy clarity, simplifying the foreign direct investment (FDI) process, and addressing capital-intensive requirements are other key challenges. Moreover, India needs to catch up in terms of certain space technologies that are currently lacking.

Listen in!

JPMorgan's recent announcement regarding the inclusion of Indian sovereign bonds in its global bond indices has sent ripples throughout the financial landscape. This decision holds profound implications for Indian government securities and the broader economic context.

In this episode of the State of the Economy podcast, Lokeshwarri SK talks to Mahendra Jajoo, CIO, Fixed Income, Mirae Asset Investment Managers. Jajoo helps decipher on the implications of this move.

The discussion looks at the intricacies of this development, which marks the culmination of prolonged anticipation within financial circles. The inclusion of Indian government bonds into the JPMorgan Bond Index is a testament to India's growing prominence in global financial markets.

Mahendra Jajoo elucidates the pivotal role played by a freely accessible route introduced by the Indian government several years ago, which paved the way for this achievement. The podcast looks at the timeline for this inclusion, scheduled to commence in June 2024, with the 10% threshold expected to be reached by March 2025.

The podcast also explores the potential impact on Indian bond yields. Despite initial market volatility, Mahendra Jajoo emphasises that global economic factors, including inflation and growth rates, make a significant decline in bond yields an improbable outcome in the short term.

The conversation extends to the prospect of other index providers, such as Bloomberg and FTSE, following suit. Jajoo expresses a positive outlook, underlining the robustness of the Indian market and the geopolitical considerations that favour the inclusion of Indian sovereign bonds in their indices.

Mahendra Jajoo addresses concerns pertaining to foreign investors' past reluctance to utilize their investment limits for Indian bonds. He postulates that, as global interest rates stabilise and alternative market opportunities diminish, India's attractive yields and stable market conditions are poised to attract heightened foreign investment.

In 2016, Reliance Jio revolutionised India's relationship with data by drastically reducing the cost of 4G data to rock-bottom levels. This move ushered in an internet boom as tech giants like Meta (formerly Facebook), Google, and other internet companies capitalised on the availability of cheap data to offer a wide range of services to Indians. These services spanned digital transactions, calls, food delivery, and entertainment, giving rise to multiple unicorns in India's startup ecosystem.

 As the telecom operators seek their share of the pie, the government is contemplating new regulatory measures to bring over-the-top (OTT) applications under the purview of the Ministry of Communications.

 In this episode of the State of the Economy podcast, businessline’s Ayushi Kar speaks to Mansi Kedia, Senior Fellow, Indian Council for Research on International Economic Relations, and Bharath Reddy, Programme Manager, The Takshashila Institution, about the various aspects of this regulatory debate.

 The telecom operators argue that they are burdened with high taxes, regulatory costs, and infrastructure expenses, while OTT platforms benefit without complying with these obligations. With revenues from calls and SMS plummeting, telecom companies rely heavily on data for their income. They argue that they need a level playing field and contributions from OTT players to invest in network upgrades, especially for the transition to 5G.

 The debate explores the sincerity of these arguments, potential alternatives for funding infrastructure, and the challenges of regulating OTT apps. Key issues such as net neutrality, selective app banning during unrest, and the appropriate regulatory authority for OTT apps are discussed.

 In conclusion, the podcast presents a nuanced discussion on the complexities of regulating OTT apps and telecom operators in the context of India's evolving digital landscape. Listen in.

(Host: Ayushi Kar, Producer: Nabodita Ganguly & Jayapriyanka J)

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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 BusinessLine State of the Economy Podcast, Amiti Sen talks to Dr. Biswajit Dhar, trade expert, on the outcomes of the recent G20 Summit held in Delhi, India. The focus of the discussion revolves around the joint communique issued during the summit, its significance, and its potential impact on the Global South.

The G20 Summit featured leaders from India, Washington, and around the world, gathering in Delhi and managing to reach a consensus on a joint communique. This was a remarkable diplomatic feat, as Indian negotiators successfully persuaded Western nations and the Russia-China duo to compromise on language regarding the Ukraine conflict. The joint communique was celebrated for acknowledging the importance of global South issues and not letting them be overshadowed by global concerns.

Dr. Dhar considers the achievement of a joint communique as a significant one. There were concerns that the summit might not produce any declaration, which would have posed a threat to the G20’s cohesion. India’s role in bringing the 55-member African Union to the table added to the complexity, making the declaration’s success crucial.

However, when dissecting the contents of the joint communique, Dr. Dhar expresses disappointment. The declaration lacks substantial provisions for developing countries, particularly in areas such as debt restructuring and financial support. Debt restructuring is vital, especially for low-income countries, many of which are members of the African Union. Addressing their debt burdens is critical to achieving sustainable development goals. The joint communique’s framework for debt restructuring is deemed inadequate, as it does not involve private creditors or multilateral development banks.

Moreover, the summit discussed issues like climate change, biofuel alliances, and phasing out fossil fuel subsidies. While these are important steps toward addressing environmental challenges, Dr. Dhar highlights the need for concrete actions beyond mere commitments.

The podcast also delves into the announcement of the India-Middle East-Europe economic corridor, which promises to boost trade between India and the European Union. However, concerns arise about the allocation of resources, as India has previously invested in infrastructure projects in its eastern flank.

One of the significant developments during the summit is the admission of the African Union as a permanent member of the G20. While this is a commendable step toward greater representation for the Global South, the key question remains: what will these countries gain from sitting at the high table, and how will India ensure their interests are properly represented?

The G20 Summit’s joint communique is seen as both an achievement and a missed opportunity. It underscores the importance of global South issues but lacks substantial provisions for developing countries. The success of the summit hinges on tangible actions to address these issues and ensure equitable representation of the Global South within the G20.