India Last Week #68
A round-up of research & reportage on India across climate, energy, foreign policy, politics & more over the last week
Climate, Energy & Environment:
“India is considering a bailout exceeding 1 trillion rupees ($12 billion) for debt-laden state-run power distribution companies. To receive the bailout funds, the states will be required to privatise their electric utilities and transfer managerial control or keep control but list them on a stock exchange, according to three government officials and a document outlining the plan prepared by the Indian Ministry of Power… The Power Ministry and the Ministry of Finance are discussing the final details of the bailout, with an announcement expected in the February budget, said two of the government sources… Under the proposal, at least 20% of the state’s total power consumption must be met by private companies and the states must assume part of the retailer’s debt, according to the Power Ministry presentation. To do so the states can choose to privatise their distribution operations for access to loans to pay off existing debt under two options. First, the states can create a new distribution company, divest 51% of the equity, which will enable them to access a 50-year interest-free loan for the privatised company’s debt, along with access to low-interest federal loans for five years, the presentation showed. The second option would let states privatise up to 26% of the equity of an existing state-owned power distribution company in exchange for access to low-interest loans from the federal government for five years, it showed.” Read more: Sarita Singh, Sethuraman N R, and Nikunj Ohri, Reuters
“The conclusions of a new report by the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) stand in stark contrast to the findings of a court-appointed investigation, which gave Vantara – a private zoo and animal rescue centre owned by the Ambani family – a clean chit in its acquisition of animals earlier this year. CITES is an international agreement to regulate the trade of threatened wildlife. India has been a signatory to it since 1976. The CITES Secretariat conducted a fact-finding mission to India between September 15 and 20, after several member-states raised concerns about the volume and origin of animal transfers to India in recent times, many of them headed to Vantara, founded by Anant Ambani of Reliance Industries… While CITES found no evidence of imports occurring without requisite permits, it did take issue with gaps in India’s due diligence, which possibly allowed for trade “in contravention of the provisions of the Convention.” Specifically, the CITES Secretariat expressed concern that animals such as chimpanzees and orangutans, which were traded as captive-bred, may not be so as defined by CITES… The body recommended India halt imports of endangered species till it reviews its import procedures and due diligence mechanisms, “prior to the issuance of import permits” and strengthens its enforcement machinery to ensure no violations occur.” Read more: Simrin Sirur, Mongabay
“India’s power system is entering a new phase of transition. As renewables and storage gain a bigger share of the country’s generation mix, coal’s role is changing to a flexible balancing resource from being a baseload provider. Its new role makes coal-based power costlier while firm and dispatchable renewable options become more cost-competitive… Using a chronological, least-cost operations model of the Indian power sector (PyPSA-India), we compare how the coal fleet operates today (FY 2024–25) versus FY 2031-32, under the NEP scenario. The analysis shows that in FY 2031-32, the power system will need coal plants far less than in FY 2024-25 during the day. The higher solar in the system will mean coal plants will need to operate closer to their minimum technical limits… This increasing flexibility requirement is what will keep making coal-based electricity costlier. As Plant Load Factors (PLFs) fall to around 55%, fixed costs will spread over fewer units of generation, driving up the effective cost of coal power… By contrast, firm and dispatchable renewable energy (FDRE) options — renewable energy coupled with battery storage — are becoming increasingly competitive, with tariffs between INR 4.3–5.8/kilowatt-hour (kWh) and proven ability to meet availability and performance obligations. India can now achieve reliability and flexibility without resorting to new coal builds. India’s next phase of power sector planning should focus on enhancing system flexibility through storage, operational reforms, and selective retrofits, rather than expanding coal capacity” Read more: Neshwin Rodrigues, Duttareya Das, and Matt Ewen, Ember
“As Delhi remained shrouded under the usual November haze, an analysis of Central Pollution Control Board (CPCB) data showed that the city has not recorded a ‘good’ air day, defined as an air quality index (AQI) of 50 or less, in over two years. The last time the capital saw ‘good’ air was in September 2023 — when a combination of rain and strong winds flushed out pollutants… The CPCB classifies air as ‘good’ when the AQI is 50 or lower, ‘satisfactory’ when it is between 51 and 100, ‘moderate’ when it is between 101 and 200, ‘poor’ when it is between 201 and 300, ‘very poor’ when it is between 301 and 400, and ‘severe’ when it is over 400. On September 10, 2023, the AQI was 45, helped by rains and winds over 30km/h. Experts say, with meteorological conditions staying unfavourable, despite an excess of 41% rain during monsoon months, Delhi is likely to end 2025 also with no ‘good’ air days. This is similar to what happened in 2024, when, despite ample rain, the year ended without a single ‘good’ air day. Rain typically has a washout effect, helping settle particulate matter (PM) and dust… CPCB launched the AQI in April 2015. Complete annual data from 2016 onwards shows Delhi has recorded only 14 good air days so far. In 2016 and 2018, there were no such days. In 2017 and 2019, Delhi had two each. In 2020, a lockdown-impacted year, restricted activities saw Delhi witness a record five good air days. The count was one in 2021, three in 2022 and one in 2023.” Read more: Jasjeev Gandhiok, Hindustan Times
“Brookfield Asset Management is planning to invest $12 billion in Andhra Pradesh’s renewable energy sector over the next three years, said people with knowledge of the matter, in what would be the largest overseas commitment in that sector for India. The purse could grow as the global investment firm is looking to establish a township, as well as multiple hotels under its Leela brand, they said. Brookfield, which is eyeing investments across the value chain in the green energy sector, is likely to invest in Indosol’s integrated manufacturing facilities and Navayuga’s renewable energy portfolio, besides manufacturing and green hydrogen projects.” Read more: Nidhi Sharma, Economic Times
Economy:
“I had the opportunity to spend some time with global investors over the past week. These are some of the smartest long-term allocators of capital, with good track records who also provide thought leadership for the industry. Having done this for many years now, I do have a sense of how preferences and themes can change over time. What were the key takeaways for me? I have never seen such indifference to India as I saw on this trip. It was almost like what we used to see 20 years back… There was not one meeting where the allocators walked in with any intention to add to their Indian public markets exposure. They were happy to get an update, understand the argument as to why India is bottoming out in terms of relative underperformance, but there was no bias for action at all… The concerns around India remain the same. Valuations are too high. There is no economic and earnings momentum. We have no artificial intelligence (AI) play or beneficiary, and concerns around the lurch to populism… The world cannot absorb another China was a key message. China is not backing away from global manufacturing dominance, fighting to keep its share if not grow it further. There is no place for a country of India’s size to emulate what China has done on manufacturing and exports over the last 30 years… On tariffs and geopolitics, most were not too worried. Everyone felt that ultimately, for the US, China remains its only true strategic rival… This episode did, however, show the lack of economic leverage for India. It may be the fourth-largest economy in the world, but is it critical in any supply chain?” Read more: Akash Prakash, Business Standard
“Korean multinational LG Electronics is looking to shift production to India for some of its newer businesses of capital goods used for setting up factories producing electronic products, displays, and high-tech components, from Korea, China, and Vietnam, said two industry executives… LG Electronics, which recently saw a robust listing of its Indian unit, is exploring opportunities for local manufacturing either independently or through local partnerships, the executives said, noting that the plans are still at an exploratory stage… LG’s move stems from its optimism of the growth potential of India’s electronic manufacturing industry. The company wants to supply machines used in setting up automated plants as well as components and displays, the executives said. Towards this, LG has for the first time supplied machinery for the automated manufacturing process of Apple’s latest iPhone 17 in India to plants owned and operated by Foxconn, Tata Electronics, and Pegatron. This was undertaken by group company LG Production Engineering Research Institute (LG PRI) which produces solutions for industries such as displays, semiconductors, camera modules, automation solutions, and robotics… The Noida Authority on Tuesday issued a release saying a high-level LG Corp delegation has finalised plans for the new global R&D facility. This will operate directly under the Korean parent. Analysts said India is emerging as a hotbed for Korean technology firms.” Read more: Writankar Mukherjee, Economic Times
“India’s services sector has added close to 40 million jobs in the past six years, firmly establishing itself as the country’s dominant engine of employment growth, absorbing labour at a pace unmatched by industry. According to a new report, India’s Services Sector: Insights from Employment Trends and State-Level Dynamics, the sector employed nearly 188 million workers in 2023–24, securing its position as the second-largest employer after agriculture… The report notes that across the entire economy, only the construction and services sectors stand out as consistent job creators, with the manufacturing sector lagging with weaker job responsiveness to output gains. Despite this rapid expansion, the services economy is characterized by a ‘dual divergence’: high-value segments like Information Technology, finance, and professional services are productivity-rich but employ a small base, while traditional sub-sectors like trade and transport dominate the workforce but are marked by high levels of informality and low wage growth… The growth in services employment is overwhelmingly an urban-led phenomenon. Over 60 percent of all urban workers were employed in the services sector in 2023–24. The sector has consolidated its position as the single largest source of employment in urban labour markets. In sharp contrast, less than 20 percent of the rural workforce is engaged in services. Between 2017–18 and 2023–24, the services share of rural employment actually declined marginally from 19.9% to 18.9%.” Read more: Dipak Mondal, New Indian Express
“The decision to simplify India’s Goods and Services Tax (GST) into a primary two-slab system of 5% and 18% is a huge win for tax reform. This highly anticipated shift replaces a complex, multi-tiered architecture and is expected to boost the economy by making compliance easier, globally competitive, and—most importantly—slashing costs for consumers. Yet, a major structural headwind persists, the Inverted Duty Structure (IDS). This anomaly, which taxes raw materials higher than the final product, traps capital in the form of unutilized Input Tax Credits (ITC). For domestic manufacturers, this means paying high upfront costs and then battling a slow, refund system to get their money back. This is devastating for the financial health of MSMEs. Because they rely entirely on steady cash flow and have few credit options, having funds locked up directly cripples their ability to run production cycles, buy supplies, and settle vendor payments, leading to a vicious and unsustainable financial spiral… GST-2.0 fixed headline rates but the redistribution (many finished goods to 5%) without matching input cuts created fresh inversions in sectors where raw materials or intermediate inputs stayed at 12–18%. That increases the spread of unutilised ITC and intensifies refund/working-capital pressure for affected manufacturers… Many packaged foods and consumer goods moved to 5%, but their packaging materials (kraft paper, laminates, some adhesives) stayed at higher slabs — producing widespread, small-value inversions across FMCG value chains that cumulatively may block significant working capital.” Read more: Pramod Sinha, National Institute of Public Finance and Policy
Foreign Policy & Security:
“Is the conclusion of a trade deal between India and the US imminent? Have all the outstanding issues been resolved? One has stopped counting, but there has been a virtual cascade of reports claiming that a deal is round the corner over the past six months. However, the two sides have not yet succeeded in turning the corner… Some observers derive hope of an early resolution from the renewal of the India-US Defense Cooperation Framework for another 10 years by Raksha Mantri Rajnath Singh and US Secretary of War Pete Hegseth on the sidelines of the ASEAN Defense Ministers Meeting Plus in Kuala Lumpur on October 31. It would appear that defense hardware and technology cooperation between the two countries remains intact. Perhaps that may be due to the US earning billions of dollars in hardware supplies to India… But India needs to be careful. At a future date, could Donald Trump object to India continuing to purchase sophisticated weapon systems from Russia, for example, the S-500, and refuse to supply some items or components to India? Its possible. After all, one did not foresee the oil sanctions… An argument has been made that Trump’s recent swing through Asia, the reaffirmation of alliances and partnerships, means that America’s Indo-Pacific strategy remains valid. But the one component of the strategy which is of relevance to India - the Quad - seems to have fallen off the radar. It seems unlikely that the Quad summit will take place in India before the year-end, as originally scheduled. Trump did not mention the Quad during his Asia visit.” Read more: Shyam Saran, The Tribune
“In the latest sign of warming ties with Beijing, New Delhi plans to quickly clear pending proposals by local companies for importing electronics parts, shoes, household items of daily use, steel products, raw materials and other goods from China and other countries. India had stopped approving such imports after ties with China worsened following border skirmishes in early 2020. However, recent improvement in relations and surging demand for several consumer goods spurred by the recent GST cuts led the government to consider this step that entails issuing mandatory certifications of plants in China and other countries to accelerate their exports to India… “We will soon begin issuing and renewing licences for suppliers from several countries, including China,” said a senior government official. “We will initiate the process and assess applications on a case-by-case basis.” The Centre is looking to help the industry augment supplies and meet surging festive demand… The latest decision is seen as a signal of renewed engagement in India-China trade talks, following Beijing’s move to resume exports of heavy rare earth magnets to India after a six-month halt, a development that has eased pressure on domestic manufacturers in the electric vehicle, renewable energy and consumer electronics sectors.
After Prime Minister Narendra Modi’s visit to that nation and meeting with Chinese president Xi Jinping in August, direct flights have resumed, and India has started clearing Chinese business visas. However, FDI restrictions still remain by way of mandatory Press Note 3 approval from the government required by Chinese companies to make investments in India.'“ Read more: Writankar Mukherjee and Shambhavi Anand, Economic Times
“India and Afghanistan are set to further ramp up their diplomatic relations with the appointment of a diplomat by the Taliban regime here this month. This will be the first official placement of a diplomat by the Taliban in India since their return to Kabul in August 2021 and will be followed - as conveyed by Kabul to Indian authorities - by the appointment of another diplomat in late December or early January. The relationship has progressed steadily this year, culminating in an unprecedented visit by foreign minister Amir Khan Muttaqi to India last month. India has reinforced its role as a trusted partner of Afghanistan with its continued supply of aid and medical supplies to the country, even in the absence of an official recognition by the Indian govt of the dispensation in Kabul… Muttaqi’s visit was significant as it also saw the Taliban backing India’s sovereignty over J&K. India too has firmly supported Afghanistan’s sovereignty and territorial integrity, at a time the Taliban’s ties with Pakistan have hit a nadir because of heavy border clashes.” Read more: Sachin Parashar, Times of India
“‘We will be convening G2,’ exulted Trump as he met Xi in Busan for their first summit since 2019 and since he unleashed a global tariff war. Two months ago, a photo-op featuring Modi, Xi, and Putin rattled many. Thursday’s photo-op moved markets - if only for a while. After months of a tense stand-off with Beijing, an ebullient Trump announced China will buy US soybeans again and hold off on rare earth controls. In return, the US reduced fentanyl tariffs from 20% to 10%, paused reciprocal tariffs, and approved export of high-end Nvidia chips to China… The prospect of a G2 has been an overriding concern with India for at least 25 years. Bill Clinton to Barack Obama, and Trump, have flirted with the allure. Fundamentally, the idea revolves around an ‘arrangement’ between the US and China on spheres of influence. Trump may want something like that… The prospect of a G2, or a similar arrangement, cannot be ruled out. The current developments come at a time when the India-US relationship is at its worth, at lease since the end of the Cold War. India now faces the highest US tariffs in the world. Visa restrictions have added to frayed nerves. The political relationship between Trump and Modi is shot to pieces. The only place the two men are meeting is on X… The strategic rationale for closer India-US ties is significantly diluted in Trump 2.0. The US is no longer in the business of balancing China, which will inevitably impact its relationship with India… The current Delhi-DC crisis may not have been of India’s making. But it has exposed some of India’s key vulnerabilities: steep climb in domestic reforms, dependence on China for critical components, slow march on innovation, and regulatory sclerosis that feels like Delhi air.” Read more: Indrani Bagchi, Economic Times
“India’s armed forces have, so far, had an excellent record of non-involvement in any kind of activity that can be described as politically motivated. A serviceman is free to cast his vote as he wishes, but any expression of political views or public signs of political affiliation has remained taboo… Of late however, the secular and non-discriminatory ethos of the military appears to be under stress. While the Indian Army has inherited a tradition of accommodating and respecting diverse religious ceremonials, especially those linked to the faith of its troops, now, there appears to be a steady push towards public display of a politically-motivated religious-cultural identity. Senior military leaders are increasingly visible at places of worship or pilgrimage and are seen participating in religious ceremonies. This is unexceptionable, since every individual is free to pray at the temples of his gods and observe the rituals of his faith… What military veterans find jarring is that such appearances are duly photographed and publicised in the media, and that officers are often seen in uniform on such occasions, in the company of political functionaries. Thus, the time-honoured regulations barring the display of religious marks, signs and symbols while wearing the uniform are frequently being violated… Such tendencies lend themselves to an interpretation that the armed forces are either initiating the process or allowing themselves to be progressively pushed into alignment with a specific religious-cultural agenda.” Read more: Arun Prakash, Hindustan Times
People & Politics:
“A Special Investigation Team (SIT) of the Karnataka Criminal Investigation Department (CID) last week informed a special court in Bengaluru that it has recovered all digital evidence related to the filing of fake voter deletion applications for the Aland constituency in the Kalaburagi district ahead of the 2023 Karnataka elections. The special court for cases against elected representatives has taken note of the investigation records in the alleged Aland vote theft case while granting anticipatory bail to the former BJP MLA of the constituency, Subhash Guttedar, 74, his son Harsha Guttedar, and a contractor associate, Tipperudra. The court directed them “to appear before the investigating officer within 10 days” for investigations… The SIT recovered multiple laptops which were used by operatives at a data centre in Kalaburagi city after being allegedly contracted to delete names of genuine voters in the Aland constituency at the rate of Rs 80 per deletion – during a voter list revision exercise conducted between December 2022 and February 2023 ahead of the May 2023 polls. The SIT recovered the laptop which was used specifically to place illegal voter deletion requests with the Election Commission of India, according to police sources… In February 2023, Congress workers in the area raised concerns and requested verification of the deletion requests after discovering several illegal requests aimed at removing people who resided in Aland from the voter list. A ground-level verification by election officials, at the instance of the election commission and the district commissioner, of the names sought to be deleted revealed that 6,018 names were sought to be deleted through remote applications across the 254 Aland election booths, and out of 6,018 voters, only 24 were found to be living outside, and 5,994 were still residents.” Read more: Indian Express
“The civic polls in Maharashtra will begin with state election commissioner Vijay Waghmare on Tuesday announcing polls to 246 municipal councils and 42 nagar parishads on December 2. Two subsequent phases will cover 32 zilla parishads and 336 panchayat samitis and 29 municipal corporations, including BMC… Terms of many civic bodies have expired for over 3 years but polls were delayed due to Covid and then court cases on OBC quota and number of wards. This will be the first major statewide election after the assembly polls last year… The announcement comes amid rising protests by the Opposition alleging that there were many irregularities in the July 1 voter list being used for the polls… “There will be no injustice towards any voter or political party. We have to finish the polls by Jan 31 in view of SC order,” said state election commissioner Waghmare. He said SEC had no role in adding and deleting names to the voter list since this was the task of ECI’s Chief Electoral Office.” Read more: Priyanka Kakodkar, Times of India
“Legal aid, a state-provided service for those who can’t afford private representation, is meant to bridge that gap. It’s a constitutional mandate, a public right, and a crucial pillar of democratic functioning. Yet, it routinely ends up failing survivors from marginalised communities. In theory, legal aid exists to support survivors of sexual and gender-based violence in their pursuit of justice. In practice, for survivors from socio-politically marginalized backgrounds, the idea of this justice can feel like an elaborate performance designed to exclude them… The inevitable retraumatisation by state institutions is baked into the system, where survivors are seen as unreliable, dramatic, and simply too inconvenient to protect… Audrey D’Mello, the director of Majlis, recalled another case of an 11-year-old girl who was sexually assaulted by her own father (according to NCRB data from 2015, 27% of rapes were committed by neighbours and 9% by immediate family members and relatives)… Delays are common even in relatively ‘successful’ cases. In one instance, a three-year-old was sexually assaulted by a staff member at her school, and upon the child’s mother filing a police complaint, the immediate consequence for them was hostility from the school authorities and trustees. And after the complaint became public—courtesy of irresponsible reporting by the media—the child was forced out of school. Though the accused was eventually convicted—a decade later—the child and her mother had long been forced to relocate, restart, and carry the burden of institutional failure. “Even though in the end we got a conviction, the mother felt like it was a very hard victory,” said D’Mello.” Read more: Devrupa Rakshit, Article 14
“Stampedes, categorised as avoidable accidents, have claimed at least 114 lives so far this year, marking the second-highest toll in recent years. In 2024, at least 123 people lost their lives in such incidents, with the crowd crush in Hathras, UP, alone accounting for 116 deaths at the end of a satsang conducted by self-styled godman Narayan Sakar Hari. The stampede at the Venkateswara Swamy Temple in Srikakulam district, Andhra Pradesh, was the sixth such incident this year. Experts have often pointed out that the absence of proper crowd control mechanisms, poor communication, and inadequate energy response systems aggravate such situations. Authorities frequently underestimate the expected number of attendees, leading to overcrowding and chaos… On June 4, 11 fans died and several others were injured in a stampede near Chinnaswamy Stadium, Bengaluru, during celebrations of RCB’s maiden IPL win. The most recent tragedy occurred in Karur, Tamil Nadu, where at least 39 people died during a rally organised by Tamilaga Vettri Kazhagam (TVK) president and popular actor Vijay.” Read more: Dipak K Dash, Times of India
“The thick green jungle and rust-red hills of Lote, on India’s west coast, give way to a small hill where a factory looms against the sky. The factory is almost brand new, but its machinery is not: it comes from the former Miteni factory in Vicenza, Italy. Miteni closed down in 2018 after one of the worst environmental scandals in the country’s recent history: after decades of producing Pfas forever chemicals, the company’s management was brought to trial for contaminating water resources in an area where 350,000 people live. In June, its former executives were found guilty at the Vicenza court of assizes of causing environmental pollution and other charges and given prison sentences, which they are expected to appeal against. And yet, all of the company’s equipment, its patents and processes – everything needed to produce Pfas – is now here in Lote Parshuram MIDC, a vast industrial enclave almost 4,000 miles away, wedged between villages and groves of trees. And the factory has just started to produce forever chemicals again… High levels of Pfas in the blood are associated with increased risk of cancer, cardiovascular diseases, liver and kidney damage, reproductive disorders and more. Ermetti is currently recovering from a recent surgical operation… After Miteni went bankrupt, its assets were bought in 2019 by Viva Lifesciences, a subsidiary of the Indian chemical company Laxmi Organic Industries – the only bidder in the public auction. By early 2023, all the equipment was travelling on freight ships, heading to Mumbai. Meanwhile, Laxmi was boasting of its new acquisition to investors.” Read more: Gianluca Liva, Filippo Tommasoli, Anna Violato and Marta Frigerio, The Guardian
Tech:
“Now that artificial intelligence has mastered almost everything we do online, it needs help learning how we physically move around in the real world. A growing global army of trainers is helping it escape our computers and enter our living rooms, offices and factories by teaching it how we move. In an industrial town in southern India, Naveen Kumar, 28, stands at his desk and starts his job for the day: folding hand towels hundreds of times, as precisely as possible. He doesn’t work at a hotel; he works for a startup that creates physical data used to train AI. He mounts a GoPro camera to his forehead and follows a regimented list of hand movements to capture exact point-of-view footage of how a human folds. That day, he had to pick up each towel from a basket on the right side of his desk, using only his right hand, shake the towel straight using both hands, then fold it neatly three times. Then he had to put each folded towel in the left corner of the desk. If it takes more than a minute or he misses any steps, he has to start over. His firm, a data labeling company called Objectways, sent 200 towel-folding videos to its client in the United States. The company has more than 2,000 employees; about half of them label sensor data from autonomous cars and robotics, and the rest work on generative AI.” Read more: Nilesh Christopher, LA Times
“The Supreme Court on Monday said more than INR 3,000 crore had been scammed by fraudsters from victims, mostly drawn from the elderly population, through “digital arrests.” A bench headed by Justice Surya Kant was referring to a confidential report submitted by the Union government… “The report shows the extent of fraud is very big… INR 3,000 crore was collected from victims in India alone. What would be the suffering at the global level?” Justice Kant asked… In an earlier hearing, the Supreme Court had orally mooted tasking the Central Bureau of Investigation (CBI) with probing the menace of digital arrests orchestrated by fraudsters posing as judges and police officers who use forged documents.” Read more: Krishnadas Rajagopal, The Hindu
“The state government of Maharashtra signed a letter of intent (LoI) with Starlink to deploy satellite-based internet services for government institutions, rural communities and critical public infrastructure, according to an Indian Express report. The report suggests that the services will also be deployed in remote and underserved regions and aspirational districts of the state like Gadchiroli, Nandurbar, Washim, and Dharashiv… The report states that a joint working group will oversee Starlink’s 90-day pilot in the state. The pilot phase will focus on connecting government and tribal schools, Aaple Sarkar centres and primary health centres (PHCs). The partnership is subject to Starlink’s regulatory and compliance clearances from the Department of Telecommunications (DoT).” Read more: Kamya Pandey, Medianama
Bonus:
“It is rarely recognised that India has been a significant source of foreign direct investment (FDI) to the world over the last hundred years. It was a major provider of banking and trading capital to Asia and Africa during the colonial era; it was the third-largest provider of ‘industrial’ FDI among the developing countries during the late Cold War period; and today it is the 25th largest source of FDI in the world and third-largest among the developing countries (after China and Brazil)… The region’s share in Indian OFDI flow has remained above 20 per cent for most of this period. Notably, the direction of Indian capital within the region has often changed: Burma (now Myanmar) was the favourite investment spot during the colonial era, Malaysia became the favoured destination during the Cold War, Singapore has become the largest recipient of Indian OFDI in the last two decades, and much of the capital expenditure in the recent years has been flowing to the Philippines and Indonesia… A new phase of deregulation began in 2004, leading to a substantial surge in OFDI flow. The RBI removed hard annual ceiling on overseas investments, linking the limit to firms’ net worth instead. Mutual Funds and individual investors were allowed to invest abroad… Southeast Asia has remained a favourite destination for Indian capital since the colonial era. Barring a few brief interludes, one-fifth to a quarter of Indian OFDI has flowed to the region. Moreover, the interludes of receding flow were often caused by policy interventions rather than economic reasons.” Read more: Sandeep Bharadwaj, Institute of South Asian Studies
Watch/listen:
Tracing the Arc of the US–India Energy Cooperation | ft. Richard Rossow | The India Energy Hour podcast