businessline's State of the Economy Podcast

In the latest episode of Business Line’s State of Economy podcast, Haripriya Sureban delves into the world of generative AI and its influence on the Indian IT sector. Joined by Siddharth Pai, co-founder, Siana Capital, the podcast takes a look at the market opportunities that have spurred major investments in generative AI by top-tier companies. The discussion centres around the transformative potential of generative AI and its ability to revolutionise the way work is done.

While acknowledging the current hype surrounding generative AI, Haripriya and Siddharth examine the concerns associated with its adoption. They delve into issues such as data security, highlighting the need for careful supervision to avoid rubbish in, rubbish out scenarios. They also discuss biases that may arise from the technology’s reliance on existing data, emphasising the importance of vigilant oversight.

The conversation touches upon the parallels between generative AI and previous technological trends, like blockchain, and explores whether generative AI will live up to its promises or follow a similar path. Siddharth suggests that the full realisation of the technology’s potential may take time, similar to the progression of blockchain.

The podcast also delves into the relationship between Indian IT companies and global players like Accenture and Capgemini. While there may be some differentiation, Siddharth Pai notes that the advantage of close client interaction lies with companies like Accenture, whereas Indian IT majors excel in offshoring and IT outsourcing.

The episode concludes by addressing the impact of generative AI on job displacement and the future of work. While generative AI will automate certain aspects of work, it will not completely replace jobs. Instead, it will bring about a shift in job roles and create new opportunities. Drawing parallels to automation in the BPO world, they examine how automation has transformed specific job functions while also opening doors to reskilling and creating new employment prospects.

Gain valuable insights into the Indian IT sector’s adoption of generative AI, the potential benefits and challenges it presents, and its implications for the future of work. 

(Host: Haripriya Sureban)

In this episode of the State of the Economy podcast, Thomas K Thomas, Chief of Bureau-Mumbai, businessline, and Prashant Singhal, the EY global TMT emerging markets leader, discuss the rollout of 5G in India. Singhal commends India for its rapid rollout of 5G, with a significant number of base stations installed and good progress made considering the delayed spectrum auctions.

He mentions that 5G adoption is happening, and people have started experiencing faster speeds and low latency in certain areas. Singhal acknowledges that there is currently no killer app driving 5G demand, but believes that as users get used to the technology and its benefits, they will not want to go back to slower speeds. He also highlights the importance of developing use cases and applications that can leverage the capabilities of 5G, such as augmented reality, virtual reality, and gaming.

Singhal notes that globally, the revenue impact of 5G has been marginal so far, with most markets still in the early stages of 5G adoption. However, he believes India has the potential to redefine the 5G landscape and generate revenue growth due to its low tariffs and large population.

Singhal also discusses the market dynamics of the telecom sector in India, noting that having three to four operators is beneficial for growth and competition. He mentions that while different operators may have different strategies regarding spectrum bands, the availability of spectrum is no longer uncertain in India.

He also talks about the opportunities for 5G in the enterprise sector, highlighting the potential for increased productivity and efficiency through applications like connected hospitals, remote surgeries, and smart manufacturing. Singhal emphasizes the importance of ecosystem development and the need for applications to fully leverage the capabilities of 5G. He believes that India, with its abundance of workforce and innovation potential, has the opportunity to lead in the development of 5G solutions and create significant revenue opportunities.

Singhal concludes by expressing his hope that India will see the real-world implementation of these use cases and applications driven by the push from telecom operators and other players in the ecosystem.

Listen in!

Host: Thomas K Thomas; Producers: Jayapriyanka J, Darshan Sanghvi

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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.

Somasundaram PR, the Regional CEO of the World Gold Council talks to businessline’s Subramani Ra Mancombu on the reasons for the increase in prices; how late monsoons or the El-Nino effect can affect gold demand; and why demand is still low in the festival season.

Somasundaram points out that while high import duties, currently at 18.5%, have contributed to the high prices, they are not the sole reason for the decrease in demand. He suggests that gold prices have risen by more than 100% in the past three years, and despite this, people still consider it a good investment. He believes that consumers should not grudge paying higher taxes on gold purchases, as the government facilitates gold imports by providing precious dollars.

Another key topic of discussion in the podcast was about how gold prices in India could be affected by the late monsoons. The speaker says that both late monsoons and the El-Nino effect could affect the demand for gold. However, the Indian government, has been able to manage such situations better over the last twenty years.

Somasundaram also speaks about the implementation of mandatory hallmarking and the unique ID system for gold. While some sections of the trade remain unconvinced and see it as a tracking mechanism, Somasundaram emphasises that these measures are aimed at consumer protection and traceability. He believes that technology has played a crucial role in the gold industry and that the adoption of the unique ID system will make recycling easier in the future.

Regarding investments in digital forms of gold, Somasundaram notes that while digital platforms and ETFs (Exchange-Traded Funds) have seen growth, they still represent a small portion of overall gold demand in India. He highlights the importance of establishing a regulatory framework for digital gold accumulation plans to further enhance investor interest in digital gold.

Overall, he believes that a comprehensive approach involving industry initiatives and government support is required to address the challenges and promote sustainable growth in the Indian gold market. 

In this episode of the“State of the Economy podcast, Abhishek Law talks to Pushpa Bector, Senior Executive Director, DLF Retail on the retail sector’s recovery post-COVID.

She highlights the strong rebound in retail sales, with luxury, Indian designers, athletic leisure, and food and beverage segments performing exceptionally well. Vector discusses how the pandemic has shifted consumer behavior, with a preference for physical shopping experiences despite the rise of online retail. She also emphasizes the importance of curating programmable spaces and creating unique experiences within malls.

Additionally, Vector addresses rental rates, noting that DLF has been able to command higher rentals due to increased sales potential. She explores the potential for expansion beyond Delhi NCR and the need to generate sales to drive rental growth in new markets.

Vector also discusses the growing trend of omnichannel retail, where consumers discover products digitally but choose to shop physically for a more authentic experience. Overall, the podcast provides valuable insights into the state of the retail sector and emerging trends.

(Host: Abhishek Law; 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. 

The PMI manufacturing figure stood at 57.8, while GST collections for June amounted to 1.61 lakh rupees.

In this episode of the State of the Economy, Shishir Sinha, Associate Editor, businessline and Radhika Rao, Executive Director and Senior Economist at DBS Group Research discuss the recent high frequency economic indicators to assess the state of consumer demand in India.

Radhika Rao shed light on the subject, beginning with the GST collection data. She noted that the figure of 1.6 trillion was 12% higher than the corresponding period last year, and the year-to-date monthly average was also 12% higher than fiscal year 2020. Rao attributed this growth to stronger demand, improved due diligence, and price effects reflecting inflation.

Regarding PMI manufacturing, Rao highlighted its significance as a confidence survey for manufacturers and service providers. India’s PMI has remained exceptionally strong, consistently above 54 for the past 20 months, signaling confidence and expansion. Furthermore, input prices have started to decrease, reducing the pressure to pass on costs to consumers. However, in the broader region, PMIs have been losing momentum, with five out of seven countries witnessing a decline, reflecting weaker export performance.

The conversation also takes a look at the impact of the monsoon on food and fuel prices. Rao emphasized the significance of monsoon onset and its geographic spread. The monsoon has covered ground rapidly, even surpassing previous records for early July.

Regarding GDP growth estimates for fiscal year 2024. Rao noted that agencies like S&P and Fitch have revised their projections, highlighting the resilience of the domestic economy. India’s less export-reliant and more consumption-driven economy, coupled with positive growth prospects.

Generative AI has immense potential to transform businesses and marketing.Shiv Shivkumar, operating partner at Advent International, and Debjani Ghosh, the president of NASSCOM (National Association of Software and Services Companies) discuss the significance of generative AI and its limitless possibilities.

Debjani Ghosh explains that generative AI is not new but rather an evolution of AI that has been continuously evolving since the 1950s. She highlights the recent advancements in access to quality data and computing power, enabling higher capabilities in content creation and language understanding.

Indian companies and startups have been working in in generative AI space since 2017-2018. In order for India to move up the value chain, India needs access to good quality data, high-end computing power, and substantial investment. Debjani Ghosh calls for building India's own foundation models, incorporating local languages and cultural context, and creating a level playing field for startups.

The discussion touches on the market potential of generative AI, Debjani Ghosh emphasises the productivity changes it can bring, making humans more productive across most jobs. Shivkumar adds that generative AI will disrupt the entire marketing value chain, impacting packaging, concept generation, and market research.

There are risks associated with generative AI. Accuracy issues, biases in training data, hallucinations, and environmental concerns due to the high computing power required are all factors to keep in Mind. There is a need for oversight, regulatory frameworks, and responsible use of AI.

While the potential of generative AI is great, Both Debjani and Shiv acknowledged the need for responsible and regulated development. They emphasise the importance of collaboration between industry and government to seize the opportunity and address the challenges associated with generative AI.

Education and healthcare are vital sectors in our vast and youthful country. Within the education industry, the edtech sector has gained significant popularity and witnessed exponential growth, particularly during the pandemic when traditional in-person classes became impractical. However, it is worth noting that the edtech sector is currently characterized by fierce competition and regulatory challenges.

Over the past four years, the number of mergers and acquisitions (M&As) in the country's edtech sector has shown an upward trend. According to data from Tracxn, the sector experienced eight acquisitions in 2019. This figure increased to 19 in 2020 and further climbed to 36 in 2021. In 2022, there were 29 recorded acquisitions.

In this episode of businessline's State of the Economy podcast, Isha Rautela speaks to Anil Nagar, Founder & CEO, Adda 247 and Kushal Bhatnagar, Associate Partner, Redseer Strategy Consultants, to know more about what we can expect from this sector.

(Host: Isha Rautela, Producer: 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. 

The global economy is facing significant challenges, with concerns about a potential lost decade due to the pandemic and slowing investment. 

In this episode of the State of the Economy podcast, Lokeshwarri SK is joined by Arun Singh, Global Chief Economist, Dun and Bradstreet, as they delve into the concerning growth and inflation figures from around the world and their implications for India. 

Singh begins by addressing the statement made by RBI Deputy Governor Michael Patra, who suggests that the 2020s could be a lost decade due to the pandemic, a slowdown in investments, and other structural challenges. While acknowledging these concerns, Singh also highlights several long-term developments that offer a counterargument. The rapid acceleration in technological innovation, infrastructure investments, and the global shift towards sustainability and environmental consciousness are reshaping various industries and driving job creation. 

The discussion then moves to inflation, a key factor influencing central bank policies and economic growth.  In terms of inflation, central banks worldwide are committed to inflation targeting as a way to maintain credibility and stability in the markets. While inflation remains a concern, central banks have learned from past experiences and are determined to keep it under control. 

The prospect for growth varies across regions. The US is projected to experience modest expansion, with a growth rate of around 1% in 2023. The EU, particularly Germany, faces challenges due to geopolitical factors and energy transitions. The EU's dependence on Russian energy and the push towards renewable energy create uncertainties. The UK also faces inflation concerns, but the government and the Bank of England need to work together to manage these challenges effectively. 

The conversation also sheds light on India's position amidst the current global circumstances, particularly considering the challenging situation faced by many advanced economies. Singh says there are several positive aspects to India's current situation. Firstly, in terms of GDP growth rate, India has reclaimed its position as one of the fastest-growing markets globally. This is a significant achievement, showcasing promising growth in various industries and sectors. The government's initiatives and production-linked incentives, particularly during the pandemic, have played a crucial role in stimulating growth and attracting global companies that were seeking alternative production hubs outside of China. India has garnered attention as a potential destination, leading to discussions and traction for the "Make in India" initiative. This, coupled with efforts to improve the ease of doing business, has facilitated investment inflows into the country. 

  To summarise, he says that while India is better positioned compared to the rest of the world, concerns regarding exports persist unless global growth improves or market diversification strategies are implemented. Listen in. 

(Host: Lokeshwarri SK, Producer: Jayapriyanka J)

It is said that wars don’t change, but weapons do. We can find that conflicts are now fought in new and innovative ways. Experts note that wars are fought on a combination of conventional and unconventional strategies, methods and tactics. Emerging technologies, like drones and Artificial Intelligence, are used to attack and sabotage the enemy without even getting into a battlefield. How can the Indian defence dispensation stop these attacks?

In this episode of the businessline’s State of the Economy podcast, Dalip Singh talks to Lt Gen (Retired) Vinod G Khandare, Principal Advisor to Ministry of Defence, about the role of emerging technologies in modern warfare.

In the podcast, they discuss how the conflict between Russia and Ukraine has shown the changing nature of warfare. They talk about the complexity of different forms of warfare, including conventional, sub-conventional, and unconventional.

They discuss India’s defence acquisition process, the armed forces’ R&D initiatives and collaborations with top universities and research institutes and strategic partnerships. They also discuss the role played by start-ups, MSMEs and venture capitalists.

In the podcast, Lt Gen Khandare talks about how the India’s military leadership approaches emerging technologies. He also talks about the need for training troops and the paramilitary on these technologies to ensure all segments of the defence establishment are prepared to meet these challenges.

Shyam Sekhar, an entrepreneur and past President of the Tamilnadu Investors Association, is a highly accomplished equity investor in his individual right. In the last five years, he has donned a new hat as Founder and Chief Ideator for i-thought Advisory Services helping individual investors with mutual fund selection and running a successful Portfolio Management Service. Aarati Krishnan, Consulting Editor with Business Line caught up with Shyam on a day when the stock indices hit new highs, to know how retail investors should deal with such milestones.

Asked about how retail investors ought to react to milestones such as Sensex hitting a lifetime high of 64000 or the Nifty50 touching 19000, Shyam said that milestones made by the indices should not matter much to investors who followed a bottom-up approach for their stock portfolio and invested in the larger universe outside the index stocks. He explained that he personally didn’t see any need for action on such occasions, as long as the companies in his portfolio were keeping to the earnings and business trajectory he had envisaged at the time of investing.

Asked if investors should be booking profits on stocks now, he recommended that investors should do so only if they felt valuations for specific stocks they owned had become too frothy, beyond their expectations. “In long-term investing, you get the best results by reducing the number of decisions you make and not interrupting the compounding on the good stocks you own. So, I try not to react to index levels or what’s happening to the market sentiment at the index level” he said.

Shyam however observed that certain sections of the market had turned frothy on too much money chasing too few stocks. He made special mention of the mid-cap segment, which has had too much institutional money flowing into a narrow set of stocks, bidding up valuations to expensive levels. “Investors who have a high exposure to mid-caps may like to take money off the table” he said.

He pointed that the recent string of block deals in marquee stocks where promoters, top management and long-standing private equity investors exited their holdings, while domestic institutions bought into these names, hinted at this being a good time to exit these stocks. Domestic institutional investors buying into these names, he felt, may pay a price in the long run for their high entry valuations. 

Asked if managing other people’s money was a different ballgame from managing one’s own portfolio, Shyam said that managing others’ money was infinitely more challenging as one had to be conscious of the fiduciary role that a portfolio manager played, in ensuring a smooth journey and good return experience for retail investors. “The kind of investors entrusting their money to PMS managers today are very different from those who did so say 15 years ago. Today we have investors who are relying on us for their wealth creation, they don’t put money they’re ‘willing to lose’ in equities”.

Tune in to the podcast for these and many other unique insights! 

(Host: Aarati Krishnan; 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.