Sree Iyer: Namaskar, today is the 26th of July Monday, and welcome to Daily Global Insight With Sri and Sree, episode 211. In Global News, Suga travails never seem to end after he took over from his illustrious predecessor Shinzo Abe. An approval rating drops to 34% with a controversial Olympics going on in Japan. Russian Prime Minister to visit Northern Ireland, claimed by Japan. China hovers around Senkaku. In a flash of good news, France’s Macron vows to cooperate with Japan in Indo-Pacific, news from Japan. Your thoughts, sir.
Sridhar Chityala: Good morning to everybody and, you know, we get ahead for with another week and well, I think the Olympics continue and the markets continue. And, you know, we expecting some exciting earnings as we move ahead. Now, getting to your specific item, which is Mr Suga, Mr Suga’s approval rating seems to have fallen to 34% and, you know, this Olympics has not gone down very well with the public of Japan, empty Stadium sponsors walking away, controversy, lockdowns, Covid is not well-managed Etc. What is compounding his problem, is that not the Chinese, but, also the Russians seem to have made their visit to the Forgotten Island. So, just let me look at quickly at the map. Now, this is the map, which is at the northern end of Japan, just passed Hokkaido, these are the Bomai Islands and the Shikotan islands, Etc. There is a dispute between the 1945 border which the Russian troops, there seems to have taken board of these islands into their fold and they have some settlements there. Of all time, this is the time that the Russian Prime Minister has chosen to visit the place, creating more controversy and then, of course, we all know on the southern side, the Chinese have incursion into near Senkaku Island. Anyway, so to wrap this up, the good news for Japan is Macron wants to do your deal, with Japan to protect, you know, to coordinate and work with the Japanese in the Indo-Pacific area in a military context. Where does that lead Quad? We can discuss that more.
Sree Iyer: In a sharp U-Turn the US tells China that it doesn’t want to veer into Conflicts and prefers negotiated discussions. So I think the US trade representative is currently in China right now?
Sridhar Chityala: The US deputy secretary of state Wendy Sherman is in China. She just concluded as we got into the show. She just concluded the discussions. The discussions are complete. China has said that it is very, very unhappy with the United States. It has given some list and says that the United States is spreading incorrect and falls and acrimonious information or non-truthful information about the Chinese. Wendy Sherman is silent at what this list is, apparently, a couple of them basically is no goals, which is to be immediately corrected you know, probably Covid is one of them and the Taiwan territorial rights, maybe the other or the Shenzhen human rights could be the other. So, therefore, the meeting was tense. It is unsatisfactory as far as Chinese media is concerned. And Wendy Sherman is silent on the list. So where we are going with this is? We’re going to soon see all these issues Trade, Covid, Hong Kong, Taiwan, Shenzhen, intellectual capital, etc., all pushed aside relegated into the background and probably a Meek and complete surrender because there is also UN try going on in the United States from some of these Pro-lobbyists making the statement, hey you know this could be an economic disaster for the world. Doesn’t matter, what the Chinese do, ignore it because the economy matters and two superpowers cannot get back into the cold war. This seems to be the message coming through so forget everything else. So I don’t think any of these investigations or any of this in all that going to be smudged away and we are going to be back to square one as we restart the game.
Sree Iyer: Well, the bigger question that I have sir, you don’t have to answer. Why is the US trade representative going even to meet with China? When China is the aggressor? And they are the ones rattling, their sabre all around and it is them who need the United States and the world for their business, more than the other way around. Why is she even there? That’s just a question….
Sridhar Chityala: Sir, I have to make only come correction, Sreeji. My apologies. Wendy Sherman is a Deputy Secretary of states are not trade. So she’s deputy to Antony Blinken.
Sree Iyer: North Korea seethes as the US and South Korea plan new military drills. Biden and Iraqi prime minister Mustafa-Al-Kadhimi to discuss US troops and Iran-linked drone attacks on Monday. On the contrary Iraqi leader is set to discuss the withdrawal of US forces from Iraq. Iraqi Prime Minister is going to tell Biden that it no longer needs US forces in a combat role, and should transition into a support role. Sir, how do you see this thing? Why is a weak Iraqi prime minister telling the United States president, what you should be doing and what is you’re not be doing?
Sridhar Chityala: It also tells you that there are two things, one is Iraqi Foreign Minister seems to be much stronger than President Biden. President Biden wants to discuss drone attacks and attacks on the US. Whereas the Iraqi Deputy minister is saying, please get out because we don’t want the US forces in combat position. You transition you know we can take care of ourselves that seems to be the message very similar to what you are hearing from the Taliban in Afghanistan. It’s just is a reflection of a very sad state of Affairs of where the United States is at today.
Sree Iyer: Two Iranian Ships Sahand and Makaran arrive in Russia for Military parades and Drills. Taliban says it does not want to monopolize power and desires a negotiated new government in Kabul and doesn’t want President Ashraf Ghani to be part of the administration. Sir, we had a very detailed discussion hang out with retired Lieutenant General Ravi Shankar and part 1 is already aired and part 2 will be airing shortly and we discussed this at length that is Afghanistan and its future, who wants to control it, who are its friends, and so on. Sir your thoughts on what is happening now, because there is a hint there, the Taliban is a ragtag outfit of 70,000 people, whereas the Afghan forces trained by the United States and other allies of the United State is 350,000 strong, whatever be the land gained by Taliban, these are all sparsely populated so it doesn’t really matter much. Whether they are owned by A or B because they can be easily driven out, that’s what the United States did in 2002, when they were on an offensive to get rid of the Taliban. And also to catch Osama Bin Laden, it’s a different matter that they allowed him to slip through their fingers. Sir, I’m sorry to give you a long winding question here, how do you see this thing? Again, the Taliban wants to go back to talk. These guys never have honoured any agreements. Why should anyone even talk to them?
Sridhar Chityala: Well, I think you have not only set the context, but you have pointed some important key strategic issues which from the US point of view needs to be responded to, forget about the Taliban and Afghanistan for a minute and we’ll get to that. But the key question that is being asked, is, does the US have a mission in Afghanistan? Clearly, its objective at that point was Al Qaeda because it was believed that the al-Qaeda forces, which was responsible for the 9/11 attacks were supposed to be there and they went after and progressively they had captured many of the leaders and including Mr Osama Bin Laden was apparently taken out in Pakistan and many of those leaders no longer probably are in Guantanamo Bay, they all have progressively been released or very few of them remain. So prosecution, never happened they remain there. So, now it begs the question. What’s the next step? Why are the United States forces still there? So, therefore, the US is answering its own question. Be it Trump or be it Biden saying our mission is complete and let’s go and we have spent 20 years. If you have not trained anybody for 20 years then you know, we’re not going to be training anybody more in the next 20 years. So I think that seems to be the Strategic theme.
But coming back to the key thing as to, the United States is not there to support their narcotics economy that flourishes especially in many of the ideas you know, which Taliban still is in control of even with United States forces in on the ground with books that thing continue to flourish is a classic example, is that when the prior to, Mr Ashraf Ghani the previous president during his period, the whole thing, you know, went up quite a significant percentage in terms of this, the opium trade. So I think they’re saying time is up let’s get out and you know Qataris have been playing a big role in the negotiations between Taliban and other things. Now the question therefore he is what is going to happen. Is there going to be a negotiated settlement as you rightly pointed out? Why would anybody believe the answer is 1 in 70 thousand others to 60,000. The answer seems to be in the fact that the Taliban is still very powerful and it seems to be controlling very critical choke points in Afghanistan. So it’s still a relevant player there, they say that without discussing with them there is no solution possible. So what did the Taliban say, get the president out and we don’t want to monopolize and we will have a collaborative or collusive government.
Sree Iyer: Well, it’s at least definitely slime down as far as Taliban is concerned. They realized that they will not be able to rule all of Afghanistan. I want our viewers to kind of Connect the Dots here, I am not going to say it out in words, a couple of things that you need to remember, just days before the last Soldier left, Bagram Air Base in Afghanistan. There was an unscheduled trip of the CIA Chief to Pakistan. Okay. And we know that the Taliban is funding all its efforts to regain land using drug sales, what is this different thing going on and in general Ravi Shankar’s hang out. He said that the drug trade has gone tenfold in the last 20 years gone up by tenfold that is a big, big number most of Pakistan’s population is affected and so is Punjab in India. The drugs are making their way across India. Now, this is a bad bad thing, but why is the CIA Chief going to Pakistan at this point in time? What the heck was he doing there? I like to know that questions are answered sir but as always these guys will keep mum but we will never know the answers. Let’s go on.
Protest rage on across Europe as vaccination mandate places restrictions. Sir, if protests rage that is going to make things worse, isn’t it?
Sridhar Chityala: Well, protest rage means that more people are likely to get affected. By the way, there is also some NGO organization in India, which is saying India should replicate the same protein protest as in Europe against mandates and Covid restrictions. So it’s very interesting it seems to be like at least fortunately the United States and many parts of Asia he will you still have some element of discipline prevalent in same in India as well. You know I hope this European contagion doesn’t spread and people don’t come onto the streets and make things even worse.
Sree Iyer: Thank you very much, sir. Let’s take a look at India news. Now, India rises to 9th rank in the Agricultural Produce Exports in the World, number one in Rice Exports, and number three in Cotton Exports. India is slowly transforming its Farming sector and much-needed Reforms are needed to further Accelerate. Indian government to operationalize, PLI scheme we have talked about PLI in the past worth 26 billion dollars covering 13 sectors in the next five years. Solar energy, corporation of India, initiates projects up to 2000MW, I should say to Gigawatt Standalone energy storage systems. India also steps up its efforts in Ladakh, where NTPC and Ladakh administration, join hands for a hydrogen-powered bus project. This will also help the movement of the military in the region. A lot of good news coming out of India although I have some other things that are not so happy about. Please continue sir.
Sridhar Chityala: Well I think the objective is to focus on some of the key economic Transformations that are taking place, that’s the objective of presenting the other side of the story. In the mainstream media and various PGurus platforms, there’s much more detailed news that comes out. So, in DGI, we try to pick up the Salient features what is the economic transformation taking place? What some of the key political issues that India is only the headline. The detail is covered in other platforms as Sree does admirably well, you know, with various kinds of experts from India.
Now, the point here to make is that nobody highlights that the agricultural transform, which used to be shuddering around, 4-7% growth is now around 14% growth. The major efforts that are being put in not only to digitize but to create an agro-economic system. So, to the extent today, Uttar Pradesh is now an exporter interpretation and several of those things that are happening in the Agro augurs well for India because Agro is one of the biggest, biggest economic drivers of the GDP.
The second thing is that the participation rate is good, also, the adjacent finished good products, which we discussed in the last DGI, augurs very well. Now, on the PLI, which has been very successful. They started with mobile production in India. The number of mobile phones that India produces through the PLI scheme shoot up from around 19% to about 90% and they’re using that as a framework to introduce this PLI program to the other schemes which create jobs, which links India’s manufacturing into the MSME ecosystem, but also links it to the global value chains and global supply chains augmenting well for India, because India is a very large and captive consumer base for many of the technologies that are developed around the world. So I think that is the message.
The Ladakh piece is that hydrogen-powered technology, which is considered to be clean fuel. Even Indian oil, which is a public sector undertaking is getting into this. You can see that there is a very strategic focus around developing these new territories especially Ladakh which is a strategic vantage point both from a border as well as from a newly established Union Territory where they are making efforts to develop the industry indigenously. Again, this is just to transform that this is not simply an administrative process, but there is also an industrial and economic process backing it.
Sree Iyer: India will continue to attract foreign investments says, Piyush Goyal. FDI into India grew by 19% to US 59.63 billion. Total FDI including equity reinvested earnings and capital rose 10% to 81.72 billion in the fiscal year 2021. We’ve been saying about the impressive numbers that India is racking up as far as the foreign exchange reserves are concerned. We will move on to the Northeastern Space Application Centre. India is going to launch a special application Centre for flood management in the Northeast. ‘I will not mediate, India and Pakistan must address their bilateral issues between themselves.’ says Biden. I don’t know who even asked him. Blinken lands in India on the 27th of July for high-level talks with the Indian leadership. What they’re going to talk about is much-discussed right now, on Indian channels. Your thoughts on what the talks are going to be about, Sir.
Sridhar Chityala: My assessment is that I have even tweeted this, which in Afghanistan is going to be one of the key items that would be on the table. The two other items are probably under consideration. I think the second item I think is, there is apparently a G20 meeting that’s happening in October. Plus there is also a QUAD Summit which is likely to take place in person later this year in the United States which Prime Minister Modi is expected to attend. So they probably are laying the groundwork for that specific meeting. The third is, there’s only mandate right now which is around covid is India to manufacture 1 billion vaccines for supply to many countries in the region, in the QUAD region. So I think Afghanistan will occupy much of the discussion followed by this preparatory meeting that is likely to happen sometime in October, both the QUAD as well as the G20 and the third is the covid. So this is what I see the agenda to be.
Sree Iyer: India vaccinates 433 million doses and over 511,000 doses in a day. The active cases are at 408,212 and the daily average new cases are at 39,000 plus as groups warn of potential escalation with Delta variant. If precautions are not taken, this is a red herring. It’s not a red herring, it is a real thing. Delta again could come back to India. Sir, your thoughts before we switch to United States news.
Sridhar Chityala: 39,000 plus is a concern. That’s number one. Second, for the first time in the last two days, the number of active cases is greater than the number of discharge cases, which means the net number of active cases is going up. So India better watches out. I also had a read a headline that in August-September, everybody wants to take a holiday and be visiting. That is the point of time when this virus begins to take a very active propagation in the ecosystem. So I would say, treat with caution.
Sree Iyer: In United States news, the House freedom committee asks McCarthy to push for Pelosi ouster after she blocks Jim Jordan and Jim Banks to the house panel committee. Pelosi picks Kinsinger, a harsh Trump critic. Nancy is back to her tricks. Will it possibly falter again, according to you? Sir, this is something, Jan 6 committee, so much is going on just in picking who is going to be sitting there? Are they trying to use the majority to come to a conclusion? Your thoughts, sir.
Sridhar Chityala: I think she is already determined that it is the Trump instigated, number one. Number two, many of the people who are involved in this are all Trump supporters or cons. Number three, that this could have been avoided and basically, Trump needs to be impeached for his bad behaviour. So I think that she has already concluded and she wants to have the right committee which says, rah rah, rah. Jim Banks and Jim Jordan, especially Jim Jordan, both who were avid supporters on that day on January 6th to make it his around an audit process should be initiated and looked at what went wrong with the elections, but not to change the course of the outcome. That event never happened. So, I think that she found them to be uncomfortable, taken out and on the contrary, she has taken a critique.
Sree Iyer: Nancy Pelosi also says that she’ll hold up the bipartisan infrastructure bill that Portman is negotiating in the Senate if reconciliation and Democrats agenda is not part of it. First of all, she is one of the most seasoned politicians on the hill and for her to act like she hates the very existence of Trump from the way I see it, politically at least. She tears down his speech, then she probably is pissed off that he didn’t shake her hand before giving the address, I’m talking about the State of the Union address, the last one that Trump gave, whatever it is at the end of the day, politicians are a breed, they have flocked themselves, they need to reconcile this thing and take the country forward. I don’t know what is going on, in speaker Pelosi’s mind, but certainly, this cannot be good, sir.
Sridhar Chityala: Well, I think we have spoken enough and we also saw the same game when the Affordable Care Act was introduced way back in 2009, we won’t get into the details but politics has become acrimony. It is a progressive agenda. She’s trying to make sure that the progressive agenda is done at any cost. That’s why you are seeing all this and various activities taking place. I think we have covered this extensively in DGI.
Sree Iyer: Biden approval rating drops to 50% according to a Gallop poll as another poll points to American pessimism on the future since May. Trump praises the Arizona election audit as sparking movement all over the country, this is very true. Sir, you thought, before I go on to the voter fraud-related news items.
Sridhar Chityala: Basically, I think that there’s a tremendous dissatisfaction on Biden because he is now stuck within the perimeter of the White House and you can see that Wendy Sherman is in China, Anthony Blinken and Kurt Campbell is navigating around and the only place he has visited in Europe for the NATO and for the G7 Summit. So there is a general dissatisfaction around the crime, around the surges that are happening. There’s a general dissatisfaction around the way, the Critical Race Theory is being forced into the school system. But overall above everything, the two things that bother Americans are, one is around the Law and Order situation across the country, two is basically the surges that are taking place, uncontrolled. These two things are big issues. Again, we point out that warning signs are coming out. There are more than 5 million active cases. As per today’s report in the morning, 62% of them are Delta variants. When this gets out of control, it’s going to be more problematic and Dr Fauci himself, whether you accept him or deny him or discriminate against him, is saying, the US is going the wrong way.
Sree Iyer: The voter fraud, poll shows the truth. 94% of Americans say it is important that all those who are legally qualified to vote must vote. While 82% say it is most important, 81% of the overall number say it is important to prevent people from voting who are not legally qualified. 78% of Republicans and 44% of Democrats agree. In all 57% agreed that voting was a fundamental right of every adult US citizen, 32% Republicans and 78% Democrats agreed with that. We are saying all these things because as we talked about there is a book of fiction that I wrote because I don’t have all the facts, but I do have all the events that happened and this talks about what could have transpired at the 2020 US elections. The basic point is that a uniform system of election to the most important post in the free world should be taken. This is my thought, what are your thoughts, sir?
Sridhar Chityala: I couldn’t agree with you more. The results of the research from Pew, the Gallop poll that was taken on the overall percentage of satisfaction of Mr Biden, all reinforce and forms the backbone of the data for you to read Sree Iyerji’s book which he proudly displayed and is being advertised heavily on the Twitter as well. So please make it a point to read the Tweet, as well as try to get a copy of it. It is written in a fictional style which shares a lot of important insights as to why the data that we are seeing backs the book which is written in the fictional style.
Sree Iyer: Josh Holly proposes Love America Act to teach basic truth in schools. As Delta variant reigns in the US across all 50 states. Dr Fauci contemplates mask mandate and booster doses. Sir, with your permission, can I go to the markets now? That’s the last one and you already covered Fauci’s statement.
Sridhar Chityala: Yeah.
Sree Iyer: Earnings and Fed reserve meeting on the 27th are the next big drivers as markets look ahead or per record last week. All big Tech firms are to report earnings this week as Futures hold steady. Disturbing actions by China on US-listed China stocks signal a cold war according to Stephen Roche. Sir, your thoughts. We know, I mean, you’ve been telling us that this year is going to be good for stocks but this latest thing about China on US-listed China stock, what is happening there, sir?
Sridhar Chityala: Well, I think the markets will continue to rise. They are already above the target set for 2021. So you will see the gyrations trigger markets. Futures, as they come in, is down by about a hundred points but you see as the earnings come in, things will recalibrate. As far as the US-listed China stocks is concerned, what China is saying is that if you’re going to be listed in the United States, not only I’ll be subjecting to your very stringent, but also, I will be imposing penalties and sanctions on such companies in terms of any activity that flows with it. This is what Dr Stephen Roche who used to be in a Morgan Stanley, the CEO chairman of Morgan Stanley, a very big China advocate who now teaches as a professor in Yale University is advocating that. This is not a good sign. I think the overall situation, the China stocks, you remember that China has been pulling up and financial have been pulling up in a number of companies which are listed and not compliant with regulations as is enacted by the Chinese regime, which is to be within the framework of how it goes about it. So now, we have the war, the war here is that the United States began to delist after the Hong Kong actions and China has reciprocated by saying that it will do the same. It is saying, if you’re going to be listed in the US, I am going to take a certain set of actions just to the Chinese companies basically telling them that you are not supposed to be transacting business until we say so. I think that’s the message that is coming. So, which in turn people are saying is a precursor to the lockdowns, disruptions in the global supply chain, which in turn will create an economic disaster. Semiconductors are one good example and you can see that Taiwan and United States and Europe. It is now trying to expand the semiconductor and automobile sector was badly affected but that’s just the tip of the iceberg in terms of the supply chain store. So this is the indication.
Sree Iyer: Before we wind down today’s hangout, here is one thought. Did the United States pay someone to make sure Naftali Bennett is in and BB was ousted? The margin of defeat for Netanyahu was just one vote. With that, we can wrap today’s Daily Global Insights. Thanks for joining, do press the bell button that will give you the notification of any new videos that get posted on the YouTube channel. Sridharji, as always, thank you sir. We’ll be back tomorrow bright and early. Namaskar.
Sridhar Chityala: Namaskar. Thank you. Have a wonderful day and we look forward to an exciting week.
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