Focus on tech - RIL’s first online AGM

Reliance Industries chairman Mukesh Ambani stood behind a virtual podium and addressed the company’s 43rd – and first-ever online – annual general meeting on Wednesday. With a gigantic blue screen beaming information as his backdrop, Ambani made several big announcements to the 3.73 lakh shareholders who had logged in. Despite the announcements, RIL’s shares fell by 6.15 per cent on Wednesday.

The first announcement was that Google will invest Rs.33,737 crore to buy a 7.73 per cent equity in Jio Platforms. The two companies will also collaborate to create an affordable Android-based smartphone, even as Jio readies 5G capability that will be rolled out as soon as the spectrum is made available.

Talking about the deal, Ambani said, “We welcome Google on board and are excited about our partnership for what it can deliver to Indians, from universalising internet usage to deepening the new digital economy and providing a prime mover to India’s economic growth. Together, we hope to play a strong facilitative role in the transformative journey of building a new, digital India.”

Sundar Pichai, CEO of Google and Alphabet, said of the partnership, “The pace and scale of digital transformation in India is hugely inspiring for us and reinforces our view that building products for India first helps us build better products for users everywhere….I am excited that our joint collaboration will focus on increasing access for hundreds of millions of Indians who don’t currently own a smartphone while improving the mobile experience for all.”

The Ambani children Akash and Isha, along with RIL president Kiran Thomas, also took the podium to announce several nextgen tech initiatives, some of which are aimed at facilitating the new normal of working or studying from home. Jio Glass, a mixed reality eyewear solution will help teachers and students to engage in a virtual 3D classroom with enhanced imaging capabilities, or enable work meetings remotely with the use of holographic images and interactivity. The younger Ambanis also unveiled plans for Jio TV Plus, a content aggregator that will bring several OTT platforms and TV channels together; an integrated healthcare system under the Jio Health Platform and the ‘made in India’ 5G capability.

Mukesh Ambani also revealed plans for a retail push, under JioMart, that will help transform kirana stores (to make them more akin to mini-marts) and help them connect with customers via WhatsApp and other tech. He added that Reliance would work with start-ups to inculcate and promote ‘made in India’ opportunities. Ambani’s announcement that the deal with Saudi Aramco in the oil-to-chemicals business has not progressed as expected, because of unforeseen conditions in the energy sector and Covid-19, may have put a dampener on things. “Nevertheless, we at Reliance value our over two-decade-long relationship with Saudi Aramco and are committed to a longterm partnership,” he added.

With the Google deal, RIL has locked down three of the Big Four of the tech world: In April, Facebook bought a 9.9 per cent stake in Jio Platforms for Rs 43,574 crore, and RIL already has a tie-up with Microsoft relating to the latter’s Azure cloud solutions.

The ‘family show’ concluded with Nita Ambani, who is also a member of the International Olympic Committee, taking the podium and pledging to bring the Games to India one day. She also elaborated on the company’s various philanthropic mandates and activities, This was the first time Nita, who heads Reliance Foundation, said she was addressing an AGM.

Trade Balance Surplus After 18 Years

India registered a trade surplus in June, the first in almost two decades, as imports plummeted, raising concerns over the health of the domestic economy.

India’s exports contracted for the fourth consecutive month and shrank 12.41% to $21.91 billion in June while imports fell 47.59% to $21.11 billion, yielding a surplus of $790 million.

The previous trade surplus was in January 2002.

Oil imports dipped 55.29% to $4.93 billion in June while gold imports plunged 77.42% to $608.7 million. Non-oil, non-gold imports—an indicator of the strength of domestic demand—shrank a steep 42.2% last month.

The decline in imports suggests tepid investment and consumption demand. India’s economy is forecast to contract up to 7% in FY21, according to some estimates.

In the first quarter of the year, exports fell 36.7% to $51.32 billion, while imports shrank 52.4% to $60.4 billion. India’s current account balance also recorded a marginal surplus at 0.1% of the gross domestic product in the quarter ended March 31 after a gap of 12 years.

The fall in exports was due to lower shipments of petroleum, textiles, engineering goods, and gems and jewellery. Iron ore, drugs and pharmaceuticals, chemicals and some agricultural commodities reported a rise, which helped limit the decline in exports.

Federation of Indian Export Organisations expects the full year contraction in exports to reach 20% in case of a second wave of the Covid-19 pandemic. As many as 26 of the 30 major items of imports contracted in June.

Assam Floods: Over 90 dead, lakhs displaced

The current wave of floods in Assam have affected nearly 36 lakh people in 26 districts. Seven more people died on Wednesday due to incessant rains. So far, 92 people have died in the state in flood-related incidents. While 66 people died in floods, 26 were killed in landslides.

In Kaziranga national park, at least 66 animals, including two rhinos, have drowned and hundreds of wild animals have been left marooned as water levels rose dangerously inundating more than 80 per cent of the park, park’s director P Sivakumar said. The Brahmaputra and eight other rivers in Assam are flowing above the danger level. As per data from the Assam disaster management, 3,371 villages are under water and standing crops in 1.28 lakh hectares have been ruined. More than 44,000 have been moved to state relief camps.

Inter-state migration touched 9m annually between 2011 and 2016

The Covid-19 pandemic may have brought the vulnerability of migrant workers into focus but data show more and more people have been moving from their native villages in search of work opportunities to other states over the decades. The magnitude of inter-state migration in India accelerated from five to six million annually between 2001-11 to nine million annually between 2011-16.

Urban population in India grew from 286.1 million in 2001 to 377.1 million in 2011 which constitutes 31.1% of the total population residing in 53 urban agglomerations with more than a million people. Nearly 14% of this urban population was estimated to be living below the poverty line in 2011-12 with 65.5 million living in slums. India’s urban population is expected to rise to around 606 million by 2030.

These figures are part of a comprehensive voluntary national review report on a wide range of sectors and progress made presented by Niti Aayog at the United Nations High-level Political Forum on sustainable development on Monday.

The report, Decade of Action: Taking SDGs from Global to Local, emphasises how India is focussing on making the SDG monitoring and implementation more localised for better results. It maps India’s progress, challenges and the way forward on various SDG goals ranging from no poverty, zero hunger, good health and gender equality to sanitation, sustainable cities and reducing inequalities.

In the backdrop of the pandemic, Niti Aayog, vice-chairman, Dr Rajiv Kumar, asserted that “the role of international cooperation is more critical than ever before.”

Despite the pressure on cities, the report says “migration can, in fact, be turned into a strong economic opportunity by overcoming bottlenecks such as migrants’ lack of access to healthcare, social entitlements, education for children, lack of improvement in skill profile and employability”.

A significant proportion of migrants and the poor in cities are employed in the informal economy which makes them vulnerable, especially in times such as the Covid-19 crisis. The report says that to mitigate the impact on various sectors including migrants both the central government and the states have announced an economic relief package with both short term and longterm measures.

Google to Invest $10 b in India Over 5-7 Years

Google will invest $10 billion in India over the next five to seven years with the aim of consolidating its position in the digital ecosystem of the world’s fifth-largest economy that is emerging as a battleground for global internet giants.

Alphabet Inc-owned Google’s outlay for India — nearly double the $5.7 billion investment made by rival Facebook in the digital platform of India’s largest conglomerate Reliance Industries in April — will be deployed through a mix of investments and partnerships, chief executive officer Sundar Pichai said.

Pichai neither denied nor confirmed reports of Google’s interest in Jio Platforms or a stake acquisition in Vodafone Idea. The country-specific nature of the fund is the first of its kind in the world for Google. “We’ll do it (deploy funds) through a mix of equity investments in large Indian companies, startups, partnerships, as well as infrastructure investments such as data centres,” he said. The fund size, he said, provides an “opportunity to directly make larger investments” in bigger companies.

Google dominates search, video, maps and email in India. Nine out of 10 smartphones sold in India come with Google’s Android OS.

Commenting on the equalisation levy imposed by India, Pichai said he favoured adoption of the Organisation for Economic Cooperation and Development framework to tax foreign digital transactions.

The mega-investment plans are also one way to combat the issue, which has seen a pushback from other US technology companies as well. “Investing in a country directly is the best way to address the problem in the long run,” Pichai said.

Pichai, among the most successful Indian immigrants in the US, has been critical of US President Donald Trump’s move to suspend H-1B visas. Google was the top recipient of the visas in 2019, according to the US Citizenship and Immigration Services.

Google will be looking out for companies that can build for India and scale up quickly across languages, according to Pichai, who said capabilities such as artificial intelligence will make it very "interesting" for Google.

“We want to scale beyond English and really invest in access, so that effectively Indians in their own language be it Punjabi or Tamil (can access internet),” the India-born CEO said. Google’s push to build local products has been boosted with the success of payment app Google Pay, which is now being scaled up globally.

India has over 500 million internet users, with 450 million of them accessing it on smartphones from smaller towns in the country.

With China, which has local behemoths such as Baidu and Byte-Dance, largely out of bounds for western internet companies, India is the only large market open to them. Google, under Pichai’s leadership, has been attempting to re-enter China, after exiting it a decade ago, but has faced setbacks. Last week Bloomberg reported that Google had abandoned plans to set up a cloud unit in the country. It has also suspended processing user requests from Hong Kong after China imposed a national security law in its special administrative region.

Pichai did not comment on Google’s China ambitions but said India has the local talent and access to a large market along with aspects of a strong entrepreneurial and venture capital foundation to build an ecosystem of its own.

On whether he looks at the call of Atmanirbhar Bharat by Prime Minister Narendra Modi as a threat for American tech companies like Google, he said his company is trying to develop apps in India as well as invest in firms which are doing it. “We want to help play a small role in accelerating that trend.”

“We are definitely happy to partner with governments, in compliance with laws in a democratic society. Privacy regulation is incredibly important,” said Pichai, who earlier in the day interacted over video with PM Modi.

Responding to a query on whether Google will extend its initiative to pay publishers for content in countries like Australia, Pichai said it was still “early days”.

“We have tried to incorporate news more in our products to generate more traffic. We’ve over the last couple of years added subscriptions as a big area,” Pichai said.

Retail inflation rises to 6.09 per cent in June

Retail inflation rose to 6.09 per cent in June, mainly on account of higher prices of food items.

Food inflation in June increased by 7.87 per cent, according to Consumer Price Index data.

The inflation figures are based on data collected from limited markets in view of the restrictions imposed on account of coronavirus pandemic.

The data collected, however, did not meet the adequacy criteria for generating robust estimates of CPIs at the state-level.

The retail inflation based on Consumer Prince Index was 3.18 per cent in June 2019.

The government had released truncated CPI data for April and May in the backdrop of the lockdown to contain COVID-19 pandemic.

Ex-royal family can run Sree Padmanabhaswamy temple

The Supreme Court upheld the rights of the erstwhile royal family of Travancore in the management and administration of the centuries-old Sree Padmanabhaswamy temple, one of the richest places of worship in the country.

It set aside the Kerala High Court’s order of 2011, which had directed the state government to set up a trust to take control of the Thiruvanthapuram temple’s management and assets. A bench of Justices UU Lalit and Indu Malhotra rejected the HC’s observation that the rights of the Travancore family to the temple ended with the death of the last ruler. The temple has been controlled by a trust run by the descendants of the erstwhile royal family since Independence.

A committee, comprising Hindus, constituted by the SC under the chairmanship of the district judge of Thiruvanthapuram will continue as the administrative head as an interim measure. The committee will take a call on opening the last of the temple’s six underground, secret vaults. In 2011, gold, jewels and statues worth around Rs 1 lakh-crore were unearthed from five vaults following an order from the SC based on a public interest litigation to assess the 16th century temple’s wealth. In July 2017, the SC had said it would examine claims that the last vault had been closed since it contained an “extraordinary treasure with mystical energy”.

The state government said it respected the ruling.

Four years after the treasures were found below the temple, gold worth Rs.186 crore was reported missing. A committee constituted by SC conducted a special audit and found large-scale financial irregularities in the temple.