Sree Iyer: Hello and welcome to episode number 79 of Daily Global Insights. This is January 21st 2021 and I have with me our co-panellists Sridhar Chityalaji. Sridharji, namaskar and welcome to PGurus channel.
Sridhar Chityala: Namaskar and good morning. We are in day 2 of Biden Administration.
Sree Iyer: Yes, and yesterday first day at the office Biden signed a slew of executive orders at least 17, I believe. We’re to look at the numbers, you are not going to go into the details today. We will not have the time but, we can take a bird’s-eye view at some of the Salient features to get a sense of which direction this Administration is added and to know more about it, let’s go over to Sridharji. Sridharji, how was the first day in office of Joe Biden?
Sridhar Chityala: I think, Mr Biden true to his promise. He got onto the business. It was a very nice and simple and sombre ceremony after kicked up with some very important kind of statements to the public in his auditorial Presidential inaugural address when he says, we may agree or we may agree to disagree and we disagree but what we are going to do is we’re not going to walk away, that’s one of his kinds of statements and in the other thing is if you still disagree, you know, that’s okay, that’s part of the Democracy. So, the story is but we want to work towards one common kind of a purpose. So, normally those kinds of flavoured speeches, statements and sentences that typically make a good speech but, doesn’t really translate into the main objective which is divided nation unification and they are alignment around the policies. The policies absolutely diametrically opposite to Trump’s policies in fact if you kind of categorizing a five of them lead the list and in fact the Socialists and progressives within the party said, you know, there is no question of we walking away and there’s no question of me taking the prisoners. They identified Health Care education student loans climate and immigration as the pillars beside the stimulus in terms of getting the economy back. So in other words those were five headlines. And if you take a look in no specific order on the climate side Paris Accord is signed, done. The United States will be back in Paris Accord. The United States will be back in on the healthcare side, back in WHO, we will work with rest of the world in making sure that the best resources are available and best access to medication and the process of discovery of any illness and stuff comes out, you know, all these kinds of bombastic statements came out, so WHO, we are in back in.
Then, on the consequence one is we discussed in Keystone, cancelled. The second one is the least that was given out in the North Dakota Alaskan reserve and there is a moratorium that has been put on that kind of lease that was auctioned. The first lease is already with National Alaskan petroleum, and they produce about somewhere between 350 to 400 thousand barrels a day. Obviously affects the wildlife that is the view of the democratic party, 23 million Acres was around that area was the deal, so, that’s on the climate side.
On the immigration side, the two important decisions one is on the census. All the illegal fellows need to be counted and so he’s put a hold, I don’t know how Supreme Court will react, SCOTUS it is. We react but the story is they need to be included. He also told that all these Caravans that are coming from Central America, you all have to wait before you kind of you know, we normalize things. He appointed a new head of Asylum Office. He also opened up the countries which we are on the no-fly list or restricted list. We don’t want to go through each one these countries. He said, we cannot be saying, Muslim nations and Non-Muslim nations and we cannot discriminate. So, he has asked them to process visa in some of these nations, so, that’s on the immigration side.
On the student loan side, he says whether that will go through the Senate or to get formal financial bill ratification is talking about waving $10,000. So, that’s on the education side.
I think the healthcare side we mentioned yesterday, he has joined WHO and then, he’s also thinking about this universal healthcare and extending further the Obama care Provisions, which was a little bit modified or put on hold by Trump, so, that will be kind of back into action. So I think that’s an education spending more money. You can see I think there will be even more money in education, which is this equality question that is coming up, whether there are different graded schools that are going to be introduced remains to be seen. So, we are into the thick of business the executive actions, unwinds many of the policies that were put in place and kicks into motion the progressive agenda.
Sree Iyer: One thought sir, on the census taking of the Supreme Court decision the SCOTUS decision of allowing illegals also to be counted. See now, the Democratic party, which is the one who’s usually the beneficiary of all these things, should they be normalized for citizenship? They would know at the government’s expense, what are the numbers that they can expect across the country?
Sridhar Chityala: Well, I think that I’m trying to understand this question and I hope I can give you the right answer.
Sree Iyer: What I’m trying to say is, without having to do the hard yards on the ground. The Democratic Party will know, what is the expected boost in their numbers?
Sridhar Chityala: I think the strike rate should be, look I think I don’t want to sound too much. Usually, you’ll find that the honeymoon period it favours the people, who actually facilitated. Once the honeymoon period is over people get integrated into the society may be, their personal preferences and choices and their values characterize. There’s nothing called as you know, I normalized 12 million illegal aliens into a two-tier model of five-year eight-year harmonization in terms of residency and citizenship. And so, therefore, I have a lifelong commitment to this Party. They may take membership into the Democratic party as they become citizens, but there’s nothing called lifelong. So, they may change views but, in the initial honeymoon period nationally the party that has given them that flavour carries the flesh. So, therefore, you would assume that you know, I didn’t want to sound the word the curry but the story is that curry and the flavour go with the initial party that has given them the grant of the compassion.
Sree Iyer: When we look at the US Politics outside of White House, Nancy Pelosi has said that President Trump could be an accessory to murder on January 6th. Is this shrill talk or what is exactly going on? Because if you see yesterday, we talked about this a senior Democratic senator Dick Durbin said that there is going to be no impeachment. So, now we are looking at two parts of the Democratic Party saying different things. What do you make of it, sir?
Sridhar Chityala: Look, I think there is been no love lost between Nancy Pelosi and President Trump. They’ve never struck a relationship, never had a relationship. I don’t even I recall I don’t even know what the Nancy Pelosi attended the Trump’s swearing-in, when, he took over as the president. Without sounding biased one way or the other, there’s a lot of criticism that Trump was not present, yesterday from a protocol. Quite a number of people who are absent important people were absent from the Democratic party when Trump took over the presidency including Nancy Pelosi be it her rhetoric, be it, the launch of this Russian interference and all the investigations that happen the first impeachment that occurred and including the State of the Union address being toned right in front. Well, all these things reflect that there is a kind of some personal animosity that is above and beyond what you can call any kind of violation of rules of law or whatever you want to kind of call it. So, this statement is again a further reflection that she wants to do it. Otherwise, there’s no investigation, there’s no assessment. What is visible is the riots right? What is not visible is what exactly has happened?
Now you talked a lot of Constitutional expert’s state that it is a First Amendment. So how can exercising the First Amendment does not constitute an impeachable offence as the first point? Second, where exactly this concept of incitement that occurred within the speech that resulted in the word insurrection. And there is again intelligence which says that some of these things were planned well in advance if that was the case who was behind it. What was the planning Etc? So, Nancy Pelosi’s rhetoric that you attribute seems to be the predisposed view that she has, rather than, what is actually behind it, I don’t know but, there is clearly much more than meets the eye in terms of some of these statements that are coming out of our office.
Sree Iyer: On the Republican side, we have seen statements coming out of Lyndsey Graham who said he told Fox that if you are going to erase Donald Trump from the party then you are going to get erased, meaning the party. And so Lindsey Graham is saying, you know, you cannot isolate Trump and then hope that the rest of the party will stay intact and there are also other people such as Jim Jordan, Rand Paul and Kevin McCarthy who are also saying you cannot impeach and you cannot split the party. So, there is a growing awareness now and I’m sure the last the two Georgia Senate seats loss must really sting them because I think one of those races on November 3rd, the Republican candidate had won, except that in the runoff that person lost. So this must be really rankling the Republicans. So you see now that in both parties, there are two two sections and they are at each other and we have to see how this plays out. So my question to you sir, is Biden has said that I am going to leave the Trump impeachment to the Senate and the Senate is not really sure about this impeachment, what happened yesterday in Senate?
Sridhar Chityala: Well, I think you have raised a very important question, which is you cannot give a Capitol Hill inaugural speech, which is to say we all must come together, this is about Unity. We must sink about differences, the word that is used, you know in the hour of peril we are confronted with challenges, we must come together. We have our differences to must unite. So, there are 74 million people who still love were voted and the Gallup poll, this morning is 82% of the Republicans like Trump. So, out of that 74 million who have voted for him, you’re talking even if you take 82% that’s close to about 60 million. The 60 million people are with him out of the 74 million on the preferential polling. Now, you go ahead and say I’m going to impeach you on day one, without the due process and so on. Then, I think what these people are saying is do you want to unite the nation and forget and move forward because even, he is not in the office, he is not a threat. He’s not in the office. Now, this is where you have to go back to Chuck Schumer statement, right Chuck Schumer says, he is unfit to hold public office. So, therefore, we must make sure that he no longer is able to contest and hold the position. So, Democrats may be having an agenda and this is something that we discussed before the show started which is to say what is ailing the Republican party. What is ailing the Republican party is the leadership and Trump was the unanimous leader, who harmonized and brought a lot of people kind of together so that target is Trump.
The impeachment and all these proceedings are project Trump, not to come. Then, you come to the next which is namely, you find that there is a lot of disunity within the Republicans that is the truth, lot of disunities. So, I think this whole impeachment agenda is to keep the divided party divided with no leader. So, the agenda can run whatever the Democratic agenda is, they can run on hinder that seems to be the motivational force or the driving force, which is typically in any politics.
Sree Iyer: Let’s take a quick look at Global News. China’s World Health Organization acted too slow for the panel to stem the pandemic and taking measures. Now, we are hearing that several provinces inside China are actually shut down. So, the pandemic is raging inside China now, what is the prognosis? Is this something new a new variant? Is it, the same original one from Wuhan what are your thoughts? What does your information, tell you?
Sridhar Chityala: The information that I get is the Wuhan is the foundation, the variances are all coming at least within China out of that. There is no variant that has come or implanted from the United Kingdom or from Japan or from the United States. So it is all self-triggered from whatever those Wuhan labs are. This is one of the points of criticism of WHO, strangely so, which China is rejecting. There is no data that has been given by China in terms of what they have found and what is the root cause? What is the structure of this virus? Are there many variants or is it a single? Does the mutation cause, you know more variabilities in the structure of this, unknown? So there’s a lot of missing data, this has been one of the criticisms. And second, if China has found this out, why it has not communicated the same to the rest of the world? So, this could have been contained. Now, the answer to these two questions is reflective of what’s happening within China probably. It is quite probable that much of these data either is lost or seems to have been lost or I don’t know what it is. But, otherwise, you can have Such a massive breakout that’s happening to the extent that these people are leaving their homes and their cattle behind and being evacuated. So, therefore they are leaving their property, they are leaving their farming stuff and moving out reflects that China is also struggling and graphing with a big issue. Is it being China? They only have got the modicum, they only have got a sample. We will never know the true magnitude of this. So answer to the question is probably we don’t know what we don’t know.
Sree Iyer: Moving on, Japan’s prime minister Suga pursues violence commitments on free and open Indo-Pacific. We have to remember these words Indo-Pacific versus Asia-Pacific. Biden has been sticking to Asia-Pacific. Now Suga is again holding his hand and saying wait, this is not Asia-Pacific. This is Indo-Pacific. What is the subtlety here, sir? Can you unravel this for us?
Sridhar Chityala: Yes, I think I’m a strong and firm believer and I’ll put my step forward in the Indo-Pacific model on East. Japan sees itself as the pillar of the security and trade apparatus and on the Western side, they see India as the anchor. So in other words, if you divide it as Pacific, South China Sea, Indian Ocean and forward going up to Djibouti, they see India as the key security architecture and then they see themselves, Australia and Japan with South China Nations as the Architects of the Pacific and South China brim. So he says the Indo-Pacific strategy as both a trade and security kind of architecture is the right word. It’s not Asia-Pacific because it is not encompassing Asia part of it. We have changed the name. We have changed the architecture. We have these two plus two dialogue. Then we have the Quad as the security and then we are providing the apparatus. So they’ve got wind of these changes in names as well as Kurt Campbell’s position, which is effective to state ‘Oh well, we need to look at this security apparatus and we can’t just simply be on Pacific, we have to extend this well into the Indian Ocean and going all the way back to Djibouti.’ So they eliminated this word and they wanted to bifurcate this into the Asia-Pacific and the Indian Ocean architecture and Suga is saying ‘we have done all the hard work. We have a broad framework.’ In a typical Japanese manner, he is giving a subtle message. It is Indo-Pacific. You guys are out. We are the custodians of CPTPP, that is Comprehensive and Progressive Trans-Pacific Partnership. We are the custodians, we are also the custodians of APAC. We are also the custodians of ASEAN. So under these circumstances, please don’t change this narrative and change the name almost giving a message you make a decision, you want to be part of it or don’t want to be part of it, we will take care.
Sree Iyer: The Indian government offered to put on hold the new Farm bills for a period of up to 18 months. This was the Crux of the conversation that took place between the agitating Farmers associations and the Indian government. The Supreme Court has put a stay on it, now the Indian government is saying we will not implement it for 18 months. Is this something that will be tried on other things also? I am just looking forward to other things that will be coming down. Will this government go and ask the Supreme Court every time, whether ‘oh I have passed this bill, should I go ahead and implement it? What do you think? Isn’t it the other way around? The legislature is the one that passes the laws. We have are instances where even after a Supreme Court ruling the legislature goes back and changes the law to override the Supreme Court ruling, for example, the nationalization of banks in 1969. So this overreach by Judiciary into executive, it is a very interesting study in democracy. How do you see this whole thing play out?
Sridhar Chityala: I have three specific observations on this. One is, the reform of the Agro sector is long overdue. Here, we call it as connecting the growers to buyers and intermediaries between growers to buyers as always resulted in an asymmetric equilibrium in the tray. Simply means the price as well as the benefits on either side, the guy who buys, the guy who produces their benefits that never reached. The intermediaries have benefited. Now that should not be the case in any ecosystem. So in all the models that we have done, we have some investments our funds have got Investments as well in this sector. So it works perfectly, the reform is needed. So the reform was done and everybody unilaterally accepted that the reforms are the good reforms that have been enacted.
Now that you asked me a very interesting question, which is the triangular struggle in India between the judicial branch the legislative branch and the executive branch, to some extent the executive branch and the legislative branch kind of merges into one single entity unlike in the United States. So, therefore, it seems like that the Supreme Court in India has decided governance part of any enactment of the law and the outcomes it seems to be accountable not the legal part. Because what you are dwelling into is the governance, of the execution of the law. When you have a bunch of people coming in and protesting you are saying ‘protest is a decent agreeable in a democracy’. You make a protest but it cannot be at the destruction of public property and when you have a vast number of people agreeing to it, you have a bunch of people going to protest and you walk, but you can’t say I’m going to hold the country to ransom. So then the Supreme Court says, ‘you guys need to sit together and talk, you’re not resolving so I’m getting involved.’ So that is the governance part of it, governance in the execution. Now, here is the malady they got into the governance. They got into a mess. Now they say ‘It is the responsibility of Delhi police to determine who comes in and who doesn’t come and then how that law needs to be, how the lawfulness needs to be managed. It’s not my responsibility, it is the responsibility of the Delhi police. So there is a dichotomy. I’ve asked this question to some of these eminent people, who runs the legal process within India. So the answer that I got is a typical, subtle answer which is, we are still evolving democracy and trying to find our way out.
So my view is as you rightly ask the question, we have seen this not only in this particular form, we have also seen this in the taxation laws. One of the soul contentions, the companies, you go back they are prospective and then you begin to ask the companies to pay taxes. So to me, I think that this is going to be a struggle as India tries to evolve into a five trillion economy. The Supreme Court should stay away from these issues. And on one agitation, they say all the people sitting there and holding the nation to ransom is illegal and they must be evacuated. Then what they do? These people don’t leave. So then they use the political fulcrum around the world and trying to create an issue when 9 out of 10 people or 8 out of 10 people agree to law, then you say the law is fair. You can’t Implement a law if people behind the execution of it are not taking ownership of it, in the case of Agriculture, this particular reform, there seem to be at least few states whom I’ve talked to they seem to be amenable and they think that this is the right thing and it benefits everybody at the process is underway, except one specific state or maybe two specific states. So this is a very bad precedent, sir, very bad precedent not just for this reform but all future reforms. So if I decide, I can assemble a whole bunch of 100,000 people, 200,000 people, I can hold the country to ransom saying I don’t like this law. By the way, all these people were looked after in a 5-star style facility, so that makes it, even more, a Jamboree for doing this.
Financial Express’s Sunil Jain has written excellent pieces on this on this reform this. Do not even give in, do not give in because a good thing is going to be thrown for a bad kind of outcome. And what do they come up with, we’ll defer for this for 12 to 18 months? I hope the government recognizes and comes up with a framework to take this forward and also establishes the Supreme Court that every time if this is going to happen, then reforms can never be advanced, and no point in blaming the government. So, therefore, I think that’s my observation.
Sree Iyer: Thank you for that. And let’s take a quick look at some other things happening in India. Sir, we are around 27 minutes into our program. Hopefully, we can touch upon these two and then we can sign off for today. This is a very interesting development, and I have my own say on why this is happening. But I will stay, I wait till after you’ve made your inputs, Amazon India is collaborating with major Venture funds to try and set up Y-Combinator type of units. These are what you call as seeding environments where you create an infrastructure where startup companies without having to worry about taking care of having rental and other things to take care of their brought into a single place where a common pool of resources such as meeting rooms and facilities, food everything so that people don’t have to have their own stuff and not have to spend time worrying about the logistical operation of a start-up. A start-up has a razor-like focus on getting their idea out to the market as quickly as possible. Long-winding, I’m so sorry about this because I needed to explain what a Y-Combinator is for the viewers. So that is a very good move. But why is Amazon India so keen on this is the question that I want to be answered from your perspective. The second one is Amazon web services is going to partner with India in setting up a Quantum grid computer Applications lab. Quantum Computing we know is a next-generation Computing. So I see these two as very significant moves. What are your thoughts?
Sridhar Chityala: I think that is a great question. So let me give you on the first one, which is the starting ecosystem. Historically, this is something that is going back to the United States coming here, Cisco used to do this if you recall going back, the whole infrastructure ecosystem was germinated. So I think Amazon is saying we are big. And it’s not Amazon retail, Amazon retail is very big, because the metrics that they have laid out give a clue as to why they are investing. They are investing in these startup ecosystems with an eye in mind that the outcome or the output from some of these initiatives will result in $10 billion worth of economic output being purchased from these companies which germinate out of this for the next 4-5 years by Amazon. So there is a very specific trade volume number that Amazon is raising its hand as an outcome to come, not just simply a leap of faith and put something and see what happens. I think that is very good.
Now here’s my take. There’s another initiative that is going on which is this issue between Reliance and Amazon in the Future Retail. So now I think there’s a resolution which is Future Retail now is going to be acquired by Reliance and you had a dichotomous, so Amazon filed in Singapore and Reliance and Future Retail in India. Anyway, I think that’s going to be consummated. So they’re saying they need a substitution, so they will say we’ll start from the ground up and we’ll build this kind of capabilities with a new idea. Amazon never goes back and buy something that is 10 years old. He’s only thinking about what is 100- 200 years from now. So to me, I can see some dots being connected.
As far as the grid computing is concerned clearly Cloud is the future and Cloud and Quantum or the future. Amazon is taking a heads-up lead, which is saying I want to partner with you and set this up. Microsoft is also big in India. IBM is also big in India, but it’s a very laudable initiative by Amazon. The other point is that Jeff Bezos does have a very good relationship with, he has been in the US-India Business Council. He has had a number of meetings with Prime Minister Modi. There is also personal chemistry between the two of them. However much one perceives him as left in his media business, which is Washington Post, there is still that modicum of relationship that all these fellows have with Mr Modi who is leading figure. My only word of caution is, all India has to learn from what has happened in the United States. That’s my final point on that.
Sree Iyer: So to sum up my viewpoint on this, you see a lot of people said, oh, why did India do a lockdown without any notice, any advance notice. India didn’t give its citizens a chance to prepare for the lockdown, they shut it down like a switch. So many people were inconvenient. They had to go back to their native places and so on and so forth. But if you look at the results, today India is perhaps one of the few countries where the covid has seen a U-shaped decline in the newer cases. So India has figured out a way to bottle up this new virus and the world is sitting up and taking notice.
Like you said Amazon is looking at a 10 to a 100 years strategy. They are saying, hmm India despite being the most one of the most populous countries in the world has figured out a way to keep this thing under control and I think it’s important that as the West still tries to figure its way out of this coronavirus and its variants. India seems to have figured out a way to have a balance between normalcy and battling the new virus. So I think that is the reward that India is getting now for having managed that. This is just my observation, I could be wrong. Viewers, if you have a different viewpoint, please feel free to chime in through your comments. And also we will now be bringing this episode to a close unless you want to add something.
Sridhar Chityala: No, I just want to congratulate, that’s a very interesting observation that you brought about which is keeping that pandemic point of view as to how to manage disruptive technologies have a profound influence on future business models. Now disruptive influence by a pandemic, India seem to have managed and I think that your point is that Amazon is saying if you have a disruptive pandemic then we need a framework with which you can implant a business techno model and I think that’s your point, which I think is an excellent point in terms of the observation that you’re bringing out, sir.
Sree Iyer: Thank you very much Sridharji. Viewers, it is my pleasure to have this process continue and for that, we need your support, please subscribe to this channel. If you have not already done. So the subscription button runs on the bottom right corner of your video as this live broadcast progresses. And also please refers to your friends and relatives. We are committed and I as well as Sridharji take a long time to put together this programme and you will notice now we have established a track record. We are one or two days ahead of news before it becomes mainstream news. So you actually are getting a heads up about what is coming down the pipeline and we appreciate your support thus far we would like to do more with this. We would like to have even better infrastructure, even better reporting facilities. So to do all the stuff we need your help and it’s not monetary as much as it is just in form of subscriptions. We need to grow to the next level. We are really trying hard to do it ourselves also but we need your help. Thank you very much Sridharji, and we’ll be back again tomorrow same time same channel. Namaskar.
Sridhar Chityala: Thank you. Namaskar. Have a good day everybody.
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