Sree Iyer: Namaskar. Today is June 28th, Monday, and Welcome to Daily Global Insights with Sri and Sree, Episode 191.
In Global News, the US conducts airstrikes against Iran-backed malicious in the Iran or Iraq, Syria border targeting sites, responsible for drone attacks in a sign of a clear message to Iran Sridharji, this is something that just happened just a few hours ago, isn’t it?
Sridhar Chityala: It is, it is I think it’s happened here, late Sunday evening and the breaking news was overnight, which is to say that there was an attack, usually there is a time to make, you don’t get this real-time. But what is significant is that we have been talking about these attacks, coming into the Iraqi airbase into Iraq here, to the US troops stationed, in the Ibrahim region closer to the Syrian border, Etc. So thus far, I think the USS has had exercised restraint, and they went after and especially targeting two specific groups which are the Kata’ib Hezbollah and Kata’ib Shayyid al-Shuhada. These are supposed to be the two groups are f-15s and f-16s seems to have been used and they targeted three specific sites, at least one site is destroyed. So I think it’s a compelling sign which is to say while we negotiate with you for peace, we’re not going to allow you to know your space being utilized to target our US forces.
Sree Iyer: Iran, says that nuclear site, images will no longer be shared with IAEA as a deal, has expired. And foreign minister Yair Lapid of Israel will be meeting with American, Italian, Bahraini counterparts, in Rome, followed by a visit to the UAE. So the new government in Israel is starting to do all its diplomacy, sir.
Sridhar Chityala: They are going around and they are doing the diplomacy and they are making the case, very clear that there is no change in policy, they have been accommodative in terms of the various constituents that make up the government, but, there is no room for slackening in terms of its approach. As Iran is concerned or the National Security is concerned, doesn’t matter whether it is Gaza or Palestine or whether there are Iranian issues, the position remains the same, I think that will be a very clear message from the president himself. In fact, the president warned, Biden not to continue discussions because it’ll become productive. So I think that is coming in place.
Sree Iyer: Jaish-Ul-Hind a terror organization believed to be associated with Iran took responsibility for the Israeli Embassy Bombing and Four Students have been arrested. So, which embassy was this, that got bombed.
Sridhar Chityala: The New Delhi embassy.
Sree Iyer: Oh, I see a couple of years ago, right, right.
Sridhar Chityala: The New Delhi Embassy that is the fact is that it has taken this long, I think Israel was involved in the investigations. It was fairly clear that it has to be, you know, Iranian-backed groups in India, which would involve there’s no surprise as it turns out how their specific areas. The fact is India seems to be, you know, you take a look at, you have every time you have Chinese sympathizers, Pakistani sympathizers. Then you have the Iranian, you have the Turkish for pretty much everybody seemed to be there and they can be triggered to unleash damage. I’m glad that I think they made some progress in addressing this wouldn’t have been possible without also the support of the Israelis.
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So, moving on, Sir. Let’s take a look at what is happening with Afghanistan? What is the future for Afghanistan after the US Afghanistan withdrawal? The prospect of Iran, turkey Pakistan, take over loom large. Afghan peace talk should continue unless the Taliban themselves pullout said Mr Abdullah Abdullah after their meeting with the US president he and the Afghan president Ashraf Ghani met Mr Biden and discussed the security Arrangements. There’s more, there are reports that the Taliban is planning a takeover with the imminent fall of the government in six months after the withdrawal. But Taliban has been, you know, planning all along to take over again Afghanistan. So, this was a, the 911 movement is the one that drove them out of power. So, it looks like they want to come back to 20 years later.
Sridhar Chityala: Well, they never were out of power. I think that they were hanging around Afghanistan. They control few provinces, which the even United States, you know, did not attempt to take charge. There’s been constant and sporadic attacks but persistent attacks around the civilian infrastructure and on security infrastructure around diplomatic enclaves. There has been constant and consistent turmoil that has prevailed over these two decades of the US footprint and the US and NATO footprint in the region. But this cannot go on sooner or later the forces have to have to be withdrawn and the Afghans must take over. And shape the way of the government, as well as the way they’re going to manage the security, as well as the administration of the country, is very clear that notwithstanding all the training and Facilities, that provided the Afghan forces are ill-equipped to deal with these Guerrilla Commander style fighting that comes with the Taliban. I think the other interesting potpurri is what’s going to be the role of India, China, and Russia in this because of various geopolitical reasons. Then, you have the Islamic Nations, Iran, turkey, and Pakistan, what is their role in taking a grip, looks like that there is a problem with the Turkish front with the Taliban. So Taliban is saying we don’t need any of you, it’s our country and we’re going to take charge. The very fact that Mr Abdullah Abdullah, you know, during the Friday meeting with Mr Biden made the statement of, you know, will continue to negotiate. But if the Taliban doesn’t want to be part of the negotiations, there’s nothing that one can do and, you know, it will lead to its own eventually course. So, that’s almost like a resignation rather than the acceptance of a New Horizon.
Sree Iyer: Indonesia and the United States are going to build a Maritime Center at the mouth of Malacca. The facility in Batam will bolster Security in the region located at the Strategic intersection of the South China Sea and Malacca Strait. In Hong Kong security, Chief named number 2 official amid clampdown and shut down of democratic institutions. The Delta variant cases rise across Asia led by Taiwan, Australian cities of Darwin and Sydney is under lockdown now. Sir, I regret to inform you that I am not able to bring that picture up, I didn’t have time to set it up. So we’ll have to talk to the pictures that you have on your side about where this Camp is coming up between Batam is going to be between the US and Indonesia.
Sridhar Chityala: But if you can imagine the Malaysia Singapore, Indonesia map, which is almost like you know to level two islands on a narrow strip separated by the Malacca Straits. Right at the tip which is around, you know past Singapore. Right At the tip of the Malacca Strait is Batam Island. So the Batam island has now become, which is the Indonesian part of information part of the land was also acquired by Singapore and are doing industry and park acquired.
Sree Iyer: So I got it up, Sir. please continue.
Sridhar Chityala: Yes, so people can see, where Batam is fairly well known to people in especially in Southeast Asia. But what is important, is that it is right at that point where there is a training facility being developed between the United States to train the Indonesian Navy, you know, in terms of in combat, as well as Naval capabilities, it is the location is very strategic. It’s Malacca Strait and The South China Sea and entry-point both are under contention, you know, which is South China seas. And the contention by the Chinese and South care and Chinese have always had an aspiration because a lot of in trade also close to the Malacca Strait. They’ve all were also interested in either forming a partnership with Indonesia or forming a partnership with Malaysia but all the nations have, reserved their independence and making sure that the Malacca Strait is not blocked. So I think it’s a strategic location and it also reflects US policy of divide and establishes just very similar to Japan, very similar to Taiwan, very similar to the Philippines. YOU are now beginning to see working Indonesia, they are printing this capability.
Sree Iyer: Tanzania to revive a ten billion dollars 10B Indian Ocean Port Project with China, the strategic importance of Dar-Es-Salam. The Tanzanian government is also insisting on Bagamoyo port due to high congestion, in Dar-Es-Salaam. And 12 German soldiers, were wounded in an attack, on a UN base in Mali. Sir, I’m putting up the first of the many pictures about where we are talking about Dar-Es-Salaam and the Bagamoyo. Viewers, You can see that on your screen. Now please, go ahead, sir.
Sridhar Chityala: I think before I transition, I forgot to mention John Lee has become who was a police chief has become the number two, he becomes as Chief secretary. It just reflects the Chinese approach in terms of how they want to put any content of any protest down and the police chief is now Chief secretary and they moved security person as the head of the police. I think his name is Chris. Chris Tong is the police chief and John Lee becomes the chief secretary is a reflection of the Chinese taking cold over Hong Kong in terms of suppressing, the Democratic any dissent, that comes through.
Coming to Dar-Es-Salaam, You’re putting up various pictures. Dar-Es-Salaam has now emerged Africa, you remember that there has been constant foray, this is one more we have covered various areas, we have covered Taiwan Strait, we have covered you know the South China Sea, we have covered Malacca Strait, we have covered. We have covered the Himalayan region, we have covered Tibet from a Chinese point of view. Now, we’re coming into Africa, we already touched and Covered just about Somalia, you know, the Djibouti Gulf of Aden, which is again, another strategic right around Yemen strategic point, which is all the countries are present in that part entering into the Indian Ocean from, you know, which is a passage for a large volume of trade. Again, Somalia has remained here with the Pirates, Somalia has been constantly in use. Now we go down further. You have that Dar-Es-Salaam, if one looks at the maps that are being shown this year are you know, there is the first map which shows that you have whether it’s alarm is and adjacent to that is Bagamoyo. Both connect to Inland Africa. Now once you enter these points then it’s straight. You can travel to a vast network of roads, which connects these two strategic ports into Africa. Dar-Es-Salaam, the Tanzanian government is saying that’s good, but it is a high point of congestion. So let us go to Bagamoyo. We can go north and south much easier rather than being congested but the Chinese are still saying we do this and we’ll do that. That’s a very interesting approach that the Chinese have taken. Then, you have a third map, which is namely the African map. The African map shows where Tanzania is located, how many countries in Africa can be interconnected. That’s the message from the third map. The last map is the Asia Africa, view of the map, which connects the Pacific, and the Indian Ocean, and the location of China. As you can see, Dar-Es-Salaam, when you go below Sri Lanka or the Indian Ocean, you have a straight passage to the South China Sea into China, right? So, therefore, this is of strategic importance to China to complete its belt and Road initiative. By the way, the belt and road initiative that is Dar-Es-Salaam is an integral part of the belt and road initiative. So they are strengthening their positions, it is not just one point, they keep coming up in various strategic locations, as the entry points we have covered Europe, we have covered Greece, we have covered Germany as to why those ports were important to China. Now, you can see we are covering Dar-Es-Salaam and the African region.
The one other thing before we transition out of the global news is the incidents in Mali. We have already covered and introduced to the daily Global insights audiences the importance of the Sahel region and where the violence, the new group of terrorist activities is coming up. Most recently the death of the 12 soldiers, representing the German Nation part of the UN force in Mali, which is right adjacent to Burkina Faso Niger Algiers, which is the starting point of the Sahel region. So it’s obviously disturbances which cost those casualties
Sree Iyer: Italy, rejects Chinese covid-19 vaccines as China, admits that they are less effective against variants. Russia mandates vaccines as coronavirus cases rice there also. So there are countries like Australia and perhaps some in Asia and in Europe that don’t seem to have any vaccines at all. So you have a tremendous, you know, asymmetry in terms of countries. Country to Country, things are changing sir. That should be a bit of a concern is because normal trade cannot resume unless everywhere things come to a certain control, isn’t it?
Sridhar Chityala: It is, I think that this in this specific instance, I think we are talking about the Delta variant. If you take Australia that you mentioned, they have a good Supply. They are using Abbott labs. I think they are using the AstraZeneca variant version that is what is being used very similar to the COVISHIELD in India. So the vaccination drive is progressing very well but nobody can stop these new variants that are coming in. Many of these old vaccines such as Phizer, Moderna and AstraZeneca are not yet ready for combating the delta variants. Both again, Russia has Sputnik and Sputnik doesn’t seem to be combative power with variants. You are beginning to see the rise in cases in Russia as a result of that. So the key message is it in Vietnam, be it in Taiwan, be it in Japan, beat in Australia, be it in Russia, you are now beginning to see this COVID delta variant creeping in and recreating the necessity of again social distancing, masks etc etc.,
So how exactly this variant will be dealt with, is an interesting prospect as we move ahead. I am told that even Britain is beginning to see high incidences and the concept of the lockdown being talked about in Britain. Fortunately, the COVAXIN in India seems to have a very high efficacy to combat this new variant that is blooming even in India
Sree Iyer: In US News China is manipulating the United States businesses to serve Beijing’s interest, House GOP, investigation, find. Sir, is this private investigation carried out by a few house members of the GOP? Is it something that is approved by the government? And I’m curious as to why the Democrats are not participating in this, after all, it is their country too. Your thoughts sir?
Sridhar Chityala: It is a continuation of some of the work that was left from the last regiment. That’s the regime of President Trump. If you recall Mike Pompeo had done extensive work and he made statements around how the education institutions were perpetuated with Chinese sponsorship and Chinese endowment, including a close collaboration that seems to have happened on the research side. How they influence, how the student community is being engaged and influenced to push the Chinese narrative. So I think that is a continuation of that effort. So it is a House GOP effort and I think they have continued and established the facts around may not just be in the diplomacy but also in the education and now they are saying in sports, NBA is one of the sports, which seemed to have very strong linkage and sponsorship and viewership in China. So that seems to be compromised. You saw the situation in the MLB (Major League Baseball), the institutions, they have mentioned, an app on YouTube to list a few Twitter, some of these institutions are compromised and they have even CCP execs either with allegiance and without allegiance sitting there and trying to influence the narrative. So this is the investigation that concludes what was being uttered during the final days where there was this talk about the Chinese interference in the election process.
Sree Iyer: Biden clarifies and reaffirms his support for the bipartisan infrastructure plan and he confirms again that he did not issue a veto threat. This as Republican Senators threatened, to walk out of the deal. But I think towards the end of the weekend, the White House said that it is absurd for GOP to oppose a two-track infrastructure plan. Joe Manchin of Democrats is also pitching for a repeal of Trump, tax cuts of 1.5 trillion to fund the social spending deal. So I think the Republicans have got on board because they need 60 votes to pass this thing. I think it’s like what 943 billion sirs. Do you think more changes could be coming, because once it is reconciled with the house, there could be more earmarks added, what are your thoughts?
Sridhar Chityala: So I think this is going to be a three-step process. It also talks about how divided The democratic party is. You have progressives, you have democrats and then you have this Centrist like Joman Chin. There was this tiptoe between did Biden approve? Did Biden kind of renegade his deal. Biden confirmed, No. The deal which I did with Republican is on. So it’s 943 Billion, so that’s done and we will try to get it through. Now if the Democrats are running against that, so he needs to have back in his pocket to make sure that he’s able to get the progressive agenda done. So the house Democrats are saying look we are progressive and we’ve been fighting for this and how you can go and strike a deal for which when GOP said two-track, is not acceptable because there seems to have been rumours coming out to satisfy this Democratic party constituent that they would be a what you call as the reconciliation process. The reconciliation doesn’t need to get through the House and Senate so there is either $ 4 trillion or $ 2 trillion dollars contemplated to the reconciliation process. So therefore what is not achieved in the 943 will be done through that. That the Republicans are opposing. Then you overlay the $ 6 Trillion dollars budget with a deficit of another $ 2 Trillion that is likely to come in. Then you have the triple whammy of the 943. Then you have the two trillion reconciliation, Then you have the Six Trillion deficit budget. Now all these numbers add up, we are going to do the arithmetic, but we will do the arithmetic as a separate fireside chat. Once the numbers settle down the budget plan is in a draft, It is not been approved and more details are expected. Now, how do you fund all this? So, Joe Manchin is saying, besides the increase in taxes, that’s contemplated, please make sure that the Trump regime tax cuts is reneged or reset. So you may be able to save not 1.5 trillion because it’s been involved for about more than three years and so part of the bill part of them, those taxes will be reduced to fund this gigantic budget. So this is the whole portfolio of the United States budget and the fighting that is going on between various factions.
Sree Iyer: We are headed for interesting times because I don’t know if viewers have been following this, but Pramila Jaypal headed committee has kind of initiated a move to break up the social media giants, such as Facebook and Google and so on. On one hand, they want them to Fan the Flames that they put out and now they are going back and biting the hand that feeds. Sir, your thoughts on where this is going to end? Will the big Tech prevail and say, enough, you want our help or not? What is going to happen, sir?
Sridhar Chityala: I think the way the United States works is unless there’s our enforcement, it’s a self-imposed law and self-imposed rule. So most of the US businesses are disconnected or decoupled from the government policies or the US government. So what the Tech platforms will do? They will continue to run, they will continue to be summoned for inquiries and Senate briefings and House briefings. They will say, sorry, my apologies, will try and put some reform programs in. Unless there is a forced manoeuvre which I don’t see happening. So you will find this present scenario of chaos and confusion and self-imposed rules of the Tech platforms prevailing for a period of time. It’s not that trivial to unwind these companies which have become such behemoth. Even to unwind will take probably 2-4 years. We have done large Bank mergers. Bank mergers take 4-5 years, even six years for the completion of the merger. So imagine unbundling all these things and changing the listings in various exchanges, etc. So I see this a bizarre exercise, which is not going to bring any meaningful outcomes. By then the government will change.
Sree Iyer: Trump returns to the campaign trail in Ohio and calls Biden a total catastrophe. Biden is a puppet to a group of people. He doesn’t know what the hell he signs, he says. Trump himself is in looming trouble as his organization faces criminal charges in Manhattan. He is, however, expected to prevail as is Rudy Giuliani, whose suspension will not stand for legal experts since no due process was followed. So now you can see that the Republicans are again regrouping and starting to go into the campaign mode perhaps for 2022 midterm elections. There were thoughts that Trump might actually run for the speaker. He might run for Congress and then he might try to become the speaker, but now I think he has shot that idea down. So, where do things stand now? Do you think the Republicans have found their feet now and they are beginning to walk again, sir?
Sridhar Chityala: I think the Republicans were yearning for leadership and to get back to the public and start preparing for the 2022 midterm elections. That’s their first objective. To win back House and Senate in the midterm elections is the first objective. While typically this happened during Obama time. The Democrats were focused on leveraging their majority to get the progressive agenda done before any perceptive changes that are likely to come out. So the Democrats are focused on making all those changes and while they are at the helm of the government, while the Republicans are hungry and feel that it is time for them to hunt. So, Trump has now commenced the rallies where the battleground campaigns are likely to occur. They are targeting the weak Democratic constituencies and then going after and that’s where Ohio comes in. The first campaign in Ohio. So, there’s going to be a series of campaigns that Trump would be launching. When you look at the audience’s that turned up, it’s quite stunning to say that this is not an election campaign, but having said that it also shows the popularity of the man.
Sree Iyer: Georgia vows to fight back as the Department of Justice sues to block voting changes. Viewers, this is not unusual at all. The Center will sue states, the state will sue back the centre, both will go to the SCOTUS, the Supreme Court of the United States and some sort of resolution is reached. So now the centre is beginning to push back on Georgia. Again, as I’ve said all along the United States needs a consistent voting policy. It needs an election commission. It needs to use something like blockchain, otherwise, this thing will keep on lingering. It’s a waste of taxpayers money according to me. Sir, your thoughts.
Sridhar Chityala: I think I agree with your sentiments. There has to be not only reforms but also the digitization of voting technology. If you don’t digitize, you’re bound to have all these manual processes and potential opportunities for fraud. So Georgia reenacted with voter ID and we have covered this reenactment of the laws and it was sent to Mr Kemp and Mr Kemp signed it into law and we saw many woke organizations or many Democrat leading organizations opposed it. We also saw the MLB getting shifted. But now it is a law signed by the governor. So the Department of Justice says, ‘How can you do this? Because this is not consistent with wide participation and denying the franchise to the legitimate voters.’ So this is the Department of Justice position. I don’t believe the Department of Justice position is going to hold its way if it makes its way to SCOTUS.
Sree Iyer: Florida’s Governor DeSantis says that 50 state officers will be helping with the United states-Mexico border crisis. I don’t think Florida has a land border with Mexico, but I think they may be sending them to perhaps the neighbouring state of Texas.
Sridhar Chityala: What has happened is there was no help forthcoming from the Central Administration or CBP. Therefore, the Immigration Control Enforcement Authority-ICE doesn’t exist. So the Republicans have said, we will anchor together, we have common thinking and process so Florida is one. I think Arizona has its own problems. If I’m correct Louisiana as well as Mississippi and few red states have volunteered police force to be sent to the border to help Texas combat because Texas is where the maximum amount of operations are happening. They are also happening in Arizona, but the maximum is in Texas. So DeSantis is saying I’m giving 50 officers to help to deal with the border crisis. I think that that is what is going on here. Just to complete that point here, the VP also visited and made a statement that there is nothing to shout about here and these are normal stuff that we have dealt with. Remember, she’s supposed to be in charge of the Border crisis. This is vice president Kamala Harris, and she’s also supposed to be working very closely with the affected States in dealing with the issue. But as is often the case, these are more political rather than collaborative.
Sree Iyer: Labour shortages have sprung up in California and in Texas. This is expected to continue because many people are getting their benefits and they don’t have to go to work. There has to be a mindset change before they start showing up at work. I think, if my memory serves me correctly, California, actually passed more laws to hold back, like, for example, evictions till the end of September, which is okay. But see this is a cycle here, if that doesn’t open, then other things toward open and therefore, the labour doesn’t feel like they need to go back to work. This is an interesting cycle, I don’t know, how is it going to be broken. But we’ll wait and see.
Oregon lawmakers have passed a bill to make illegal immigrants eligible for Medicaid. Democratic Governor Kate Brown is expected to sign this into law. Sir, this is another one, where the taxpayer is going to pick up the bill.
Sridhar Chityala: Yeah, there are four essential elements. That’s why these immigration or illegal surges, or illegal immigration pops up. First and foremost, there seem to be no limits and basically, the whole thing is like a caboodle. The borders are open and there is a gush, number one. Number two, who is bearing these transportation costs and housing and locating and all the issues surrounding the taxpayers and they seem to be going into mainstream America facilitated through the process of aeroplanes, buses, and so on and so forth. The third issue is, how do you fund these people, from New York to many of the Democratic states are saying they’re going to tax people and the tax money going towards paying on an average between $10,000 to $40,000 for each of these illegal migrants to settle down in this country including temporary housing. Then you have the fourth, you’re beginning to see the unravelling of this and Oregon is an example. It is providing health care. How do you provide healthcare? You have normal people who don’t have health care but these illegal migrants are going to be accommodated under the Medicaid Health Care scheme. One of the biggest challenges that the United States faces, apart from the blowing away of the budget, is this illegal immigration crisis around the taxpayers’ money, around the security, around the employability within the ecosystem, because you are giving so many benefits and you’ve got so many people, and these people have to be served and nobody wants to work.
Sree Iyer: Let’s take a look at some news coming from India. Satellite images show that the Chinese and Indian troops and tanks were within handshaking distance of each other last August. August 31st, 2020 was especially a special day. There’s an article in Swaraja magazine which tells all the details of what had happened. Sir, your thoughts. How are things today compared to that?
Sridhar Chityala: First and foremost, the satellite images referred that article will tell you a very compelling position of how close and how significant the India-China situation was. How voluntarily it was!. This was the time if you recall France, Britain, Israel, US all stood with India and basically said they will even have boots on the ground to support and they will not allow China to invade. But India augmented itself to full capability. A special team of Commandos went in and occupied the Kailash Heights giving them the strategic advantage, and then the Chinese rushed tanks and people in. Apparently, no more than 400 feet, they can see each other at a handshaking distance. Where are the satellite images? If you recall, the US and India signed what they call BECK – Bilateral Exchange Communication Service agreement, which allows US satellites to provide data directly to the people who manage the security and border affairs in India. So a lot of information was gleaned by virtue of that access. But the point that we’re trying to make is that they were so close. Have the positions changed? To some extent. But still, if you recall again we covered this in DGI program that in certain positions they are not willing to renege and disengage. So both sides are holding position. This will probably go on until one side blinks, I don’t know which side but so far both sides have not blinked.
Sree Iyer: Two drones were used for carrying out explosions inside the Jammu Airforce stations’ technical area. So far, there have been no damages. The National Investigative Agency is investigating the matter. Now, it is not clear if these drones came from across the border from Pakistan. This Air Force station is about 14 kilometres from the International Border. And at this point, I’m not sure if they’ve made any determination on where this has come from. Sir, do you have any updates on this?
Sridhar Chityala: It is alleged that it has come from. T the other side of the border. The other side of the border is fairly obvious to everybody. Apparently, the NIA or the Army has been tracking drugs, arms, explosives and such remote activated bombs for the first time were seen where drones were used to instigate these incidents. Though this particular instant did not create any major damage, there’s a genuine concern. I think there are only two casualties. There was a mind explosion. This is not a military area. It is used for transportation, helicopters, transportation facilities. But the fact that two drones landed there and created a mild hiccup is a problem and so the investigation is underway, They are not specific but they do say that it has come from the other side. And there have been several attempts for transportation of all those items that I mentioned. I am sure we will have more details soon.
Sree Iyer: Yes, India and Greece converge on the vision of free and open Indo-Pacific with the Greek counterpart Nikon Dandiya heading to Dr JaiShankar’s request. Greek has also handed over the signed agreement to join the International Solar Alliance of which India is the leader.
I’ll also read one other item, New India’s renewable solar energy witnessed over 70 billion in investments in the last seven years. So this is all I have for solar energy. Sir, your thoughts. How significant is this India-Greece deal?
Sridhar Chityala: The significance of the deal can be explained in two ways. One is, Greece is perceived to be China’s ally and so Greece provides access. Potentially, Greece provides access and conduit for China into Europe. The fact that when Jaishankar was present, they handed over the agreement both for the ISA – International Solar Alliance as well as an agreement to have an open and free Pacific is a reflection that on the diplomatic front, India is slowly plugging away. So tomorrow, if China is threatening Greece in terms of free passage into Europe, the restricted passage where it controls then at least India can say, hey Greece, you basically helped us with the pro. So the same thing you can apply. So that’s one facet.
The second is France also has been supporting Greece because you remember there was this Cyprus issue – North and South Cyprus where Turkey took one side and threatened Greece and then the French rushed their submarines as well as their attack naval ship. So, therefore, the fact that France and India are working diplomatically with Greece is a significant development in the geopolitical context, in terms of all these various battles that are going on with China.
Sree Iyer: India crosses the 300 million covid vaccine doses, as the Wave 2 appears to be contained, sir. I have the dashboard with pictures on how many sites are conducting the vaccination and what is the total number of registrations, 340 million total vaccination doses, 318 million, so I have that graphic, sir, please go ahead.
Sridhar Chityala: Yes, I think there are two key messages. The first message is that data is further updated, so it’s about 323-324 million vaccine doses, and that simply implies that India has now gone past the United States as number one, I’m excluding China, the number one country in terms of the number of doses. With all the criticism India received they’re averaging between 5-6 billion vaccination doses per day. This puts India into a very good position, with 40 million people who are vaccinated over six days. That’s again a big number. That is the first part.
The second part is, in terms of the active cases, remember is not too long ago India had more than 4 million active cases. They brought it down to about 555, per day on average, 50 to 60,000 cases are getting cured so that they are able to manage and come out of the way to the wave-2. The last figure is, again. India had wide advertisement, more than 4,000 people getting dying every day too. Now they have brought that number to about 1,000. So I think India has done well. Having had hiccups as it started wave-2, and now been attempts to prepare for wave-3. So, slowly, The Indian government is getting a handle on this vaccination issue. Especially after they moved it to Central distribution and Central vaccination after initially faltering by giving it to the states.
Sree Iyer: Let’s take a look at markets now. The S&P hits another record boosted by bank stress-test, infrastructure deal, low rates as we head into a new week. So it looks positive. Now, how is the inflation scenario looking and what are your thoughts for this week as far as the Markets are concerned.
Sridhar Chityala: I think we will continue to see the uptick in the markets. Inflation is the highest that we have ever seen. The Central Bank looks at inflation at 3.4%. But the markets look at 4.2%. Either way, you calculate it is way up 2% or 2.4%. But it’s an accommodative Fed, and accommodative treasury. So, the present low-interest rate regime will prevail. The good news is that the FED has said it is keeping a close eye. They may advance these accommodating policy to much more stringent by raising the rates in 2022 or in 2023. In 2023, we may see 2 rate increases, but they may continue these accommodative policies till 2022 basically because zillions of dollars are getting loaded and the new metric that there is that the FED is using, is the ability to employ those who are unemployed. What is complicating the problem? Many people can be employed for not getting back to work. So there are consistent unemployment levels on one side because they’re all been given dole, then you have the other side, the industry suffering from lack of people to get back to normalcy, is a dichotomy that I don’t know whether we’re going to solve this problem. But with enough liquidity in the system and with a $6 trillion budget and deficit all you can expect is the market will continue to perform at a good velocity.
Dow Jones was down last week, it was down8.7 from 14. It is almost are back to normal. So within a week, you have seen shifts of close to 6% to 7% movement in the annualized gains or Y2D – Year to Date earnings of a specific index. This an unusual year, Dow has outperformed NASDAQ as well. And while this goes on, the oil prices continue to surge as the economy comes back into normalcy. People have been waiting for this to happen and OPEC will step up the production and will also increase the price to make up for all the losses that they incurred over the past 12-15 months.
Sree Iyer: With that, we bring today’s DGI to a close. We’ll be back again, tomorrow bright and early. Stay tuned. Do subscribe to our channel, do consider joining the membership of our channel and we’ll be back with Ask Abhijit in about two hours time at 9 p.m. IST, 11:30 a.m. eastern standard time. Stay tuned and Namaskar.
Sridhar Chityala: Namaskar. Thank you. Have a good day and we’ll see you tomorrow.
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