All newspaper Editorials at One place 30 Jan 2024

All Newspaper editorials in one place – January 30, 2024

THE HINDU – Changing partners
THE HINDU – The best of Tests
THE INDIAN EXPRESS – Interim takeaways
THE INDIAN EXPRESS – NO LOOKING AWAY
THE INDIAN EXPRESS – The new champions
THE TIMES OF INDIA – What’s ‘Social Justice’?
THE TIMES OF INDIA – Mona Lisa Shrugs
THE ECONOMIC TIMES – Have a Human Ghost In the AI Machine
THE ECONOMIC TIMES – Make the Move On a Two-State Solution
THE HINDU BUSINESSLINE – Complete disarray
BUSINESS STANDARD – Questions on China
BUSINESS STANDARD – Nitish’s U-turn
FINANCIAL EXPRESS – FDI in ASEAN
FINANCIAL EXPRESS – Apple is our hope for making AI more private

THE HINDU

January 30, 2024

Changing partners

Nitish Kumar’s unedifying volte-faces are an insult to voters of Bihar

Ideological infidelity is not a rare affliction among career politicians. Power, wealth and the many vices that often motivate political actors are not unfamiliar to Indian voters. Even by these low standards, Bihar Chief Minister Nitish Kumar appears to be plumbing new depths with his recurrent somersaults. He has changed partners multiple times, with little more reasoning than satisfying his desire for power. Mr. Kumar’s about-turn in 2017 betrayed the mandate of 2015 and in 2022, he betrayed the mandate of 2020. In 2020, Mr. Kumar’s Janata Dal (United) had won the election in alliance with the Bharatiya Janata Party (BJP), but two years later he broke from it to form an alliance with the Rashtriya Janata Dal (RJD) and the Congress. That was a clear insult of the mandate. He has now made yet another turn, this time returning to the BJP-led National Democratic Alliance. Within the day, he resigned as Chief Minister, claimed the post again with new partners, and was sworn-in again as Chief Minister. Only a few weeks ago, Mr. Kumar was fashioning himself as the leader of the anti-BJP Opposition alliance. It might be true that politics makes for strange bedfellows, but Mr. Kumar has turned his acts of disloyalty into a familiar script. Meanwhile, his claim of being a champion of good governance appears so distant in the past, and completely unfamiliar.

Until the moment of the turnaround, the BJP was loudly proclaiming that it would never again align with Mr. Kumar and the JD(U). There is no explanation from either side on their sudden change of heart. Mr. Kumar had tried to corner the BJP on the question of caste, in alliance with the RJD and the Congress. The socio-economic survey of castes in Bihar that his previous government ordered did not turn out to be a watershed moment as Mr. Kumar perhaps hoped. At the same time, the BJP felt insecure enough to look for a rapprochement with the JD(U), which commands considerable following among non-Yadav Other Backward Classes in Bihar. The opening of the Ram temple in Ayodhya marked a new phase of Hindu consolidation behind the BJP, but the party is always watching out for erosion triggered by caste mobilisation. By redrafting Mr. Kumar, the BJP has defanged the limited potency that was left in his social justice politics. The BJP is the biggest beneficiary of the realignment in Bihar, while the biggest loser might be Mr. Kumar himself. His political base is being raided, and his legacy stands besmirched. But, he is still the Chief Minister, and nothing else seems to matter to him. It is not exactly future perfect, but it is happily present continuous.

THE HINDU

January 30, 2024

The best of Tests

Test cricket showcases skill better, but is not short of excitement

Hyderabad and Brisbane are split by an aerial distance of 9,443 kilometres and yet on Sunday, the two cities were seemingly fused together through some cricketing magic. The old sporting trope of the underdog toppling the fancied rival was again in play as England at Hyderabad and the West Indies at Brisbane, respectively humbled their potent hosts India and Australia. Test cricket, often lost in the stardust and breathless hype that permeates its younger and faster siblings, ODIs and T20Is, found its mojo and again reiterated its durability and the potential to alter scripts and presumptions. At Hyderabad’s Rajiv Gandhi International Stadium, England conceded a 190-run first innings lead to India and on a surface tipped to aid spin, it was deemed that Ben Stokes and his Bazball troops were down for the count. However, in the second innings tussle, Ollie Pope’s splendid 196 and left-arm spinner Tom Hartley’s seven for 62 left India stranded by 28 runs while chasing a target of 231. Pope’s sweeps, both conventional and reverse, employed against the Indian spinners were effective, and debutant Hartley, whose first ball in Test cricket was hammered for a six by Yashasvi Jaiswal, made a stirring comeback in the second dig to hoodwink Rohit Sharma’s men. England now leads the five match series at 1-0.

The absence of Virat Kohli, due to personal reasons, did leave a vacuum in the middle order even as the other batters, including K.L. Rahul, tried hard to bridge that gap. England spinners choking Indian batters in their backyard is not new as Phil Edmonds and Pat Pocock showed in 1984, and Graeme Swann and Monty Panesar in 2012. As the series shifts to Visakhapatnam, India will have to find a method to reiterate its dominance. Meanwhile at Brisbane’s Gabba, it was the turn of another debutant to prosper. Despite an injured toe, Shamar Joseph’s fiery pace and his second innings tally of seven for 68 blew away the Australians, who pursued a target of 216. The eight-run triumph helped the West Indies draw level the two-Test series at 1-1. The stalemate hinted at the need for a minimum of three Tests to judge teams and find the real victor. The men from the Caribbean have floundered in the past, but the latest result hints at a turnaround. The West Indies had its sunshine phases in limited overs cricket, winning the ICC Champions Trophy in 2004 and the ICC T20 World Cups in 2012 and 2016. Sunday’s Test victory offers a fresh path laden with hope for the West Indies.

THE INDIAN EXPRESS

January 30, 2024

Interim takeaways

Interim budget will provide indications of government’s assessment of the economy, and the contours of its fiscal position

IN A FEW days from now, Union Finance Minister Nirmala Sitharaman will present the interim Union budget for 2024-25. While the final budget will only come once a new government is in place after the national elections, this budget will provide an indication of the government’s assessment of India’s economy, and the contours of its fiscal position. It will be read closely for what it says on several questions.

First, at what pace does the government expect the economy to grow in the coming financial year? The last budget assumed that the economy would grow at 10.5 per cent (in nominal terms) during 2023-24. However, as per the first advances estimates, growth is expected to be slower at 8.9 per cent. Some indications of the government’s thinking can be found in a finance ministry report titled “The Indian Economy: A Review”, released on Monday. According to the report, the economy is likely to grow at 7 per cent in the coming year (in real terms), with growth being driven by healthy domestic demand and supply side measures. It restates the expectation of India becoming the third largest economy in the world with a GDP of $5 trillion in the next three years, and says that it can aspire to become a $7 trillion economy by 2030. Second, will the government stick to the path of fiscal consolidation? The Centre has managed to bring down its fiscal deficit from 9.2 per cent of GDP in 2020-21 to 6.4 per cent in 2022-23, and considering the trends in revenues and spending so far, most analysts expect it to meet the deficit target of 5.9 per cent this year. In her budget speech of2021 -22, the finance minister had stated her intention of bringing down the deficit to below4.5 per cent by 2025-26. Staying with this path of consolidation implies a steep reduction in the deficit of 1.4 percentage points over the next two years. Third, over the past few years, the government has ramped up its capital spending, expecting that it would help crowd-in private sector investments. Its capex has risen from Rs 5.9 lakh crore in 2021 -22 to Rs 10 lakh crore in 2023-24 (BE). As per the finance ministry report, overall public sector capex has risen from Rs 5.6 lakh crore in 2014-15 to Rs 18.6 lakh crore in 2023-24 — an increase of 3.3 times. The question is whether, or not, public capex will see such a sustained momentum in the coming year.

Considering that national elections are just a few months away, there are expectations in certain quarters of a greater focus on specific constituencies, such as youth, farmers, and women. While political compulsions may well hold sway now, in due course of time the focus must be on pushing through reforms, including in areas such as skilling, learning outcomes and health, as outlined in the finance ministry report, to put the economy on a high growth trajectory that can be sustained.

THE INDIAN EXPRESS

January 30, 2024

NO LOOKING AWAY

ICJ’s interim judgment on Israel’s actions in Gaza comes with moral heft, urges international community to do the right thing

The interim judgment by the UN’s International Court of Justice (ICJ) on Israel’s actions in Gaza signals a moral victory for Palestine and those demanding an end to Israel’s retaliatory violence after Hamas’s October 7 attack. Even though the Court stopped short of calling for a ceasefire in embattled Gaza, its interim ruling, endorsed by a majority of its judges, is a strong censure of Israel in the genocide case brought by South Africa. The ICJ stated that “at least some of the acts and omissions alleged by South Africa to have been committed by Israel in Gaza appear to be capable of falling within the provisions of the [Genocide] Convention”, and asked Israel to refrain from, and act against, incitement to genocide and acts of destruction, and ensure distribution of humanitarian aid in Gaza. The ruling also ordered the immediate repatriation of hostages by Hamas. Since the beginning of the Israeli offensive in October, the Palestinian enclave has witnessed over 25,000 deaths, a majority of them women and children. The war has also made refugees of nearly 85 per cent of Gaza’s population.

While Israel’s compliance with the interim ruling is not mandatory — the Court’s order is legally binding but the ICJ has no enforcement mechanism — it signals an important moment. Over the course of the last three-and-a-half months of war, allies such as the US and the UK have repeatedly upheld Israel’s right to self-defence over accountability for its violation of humanitarian laws. Soon after October 7, President Joe Biden had participated in an Israeli war cabinet discussion on Israel’s retaliation strategy. The UK’s foreign secretary had recently dismissed South Africa’s charge of genocide at the ICJ as unhelpful. Both the US and the UK, alongside others, have stopped their funding for the United Nation Relief and Works Agency in Palestine, amid Israel’s charges of complicity against 12 of its staff members in Hamas’s attack on Israel. Even though the final verdict may take years to come, the interim judgment creates a moral pressure on these nations, making it harder for them to look away.

The ICJ’s interim verdict came on the eve of International Holocaust Remembrance Day. In part, the Genocide Convention had come up after World War II as a reaction and possible deterrent to catastrophes such as the Holocaust. It imagined a recalibration of the international community that would uphold human rights and push one another to do the right thing. The ICJ’s ruling might lack enforcement authority but it comes with that moral heft.

THE INDIAN EXPRESS

January 30, 2024

The new champions

Jannik Sinner’s first Grand Slam title speaks of a sport going through a transitional moment

Following Jannik Sinner’s 3-6, 3-6, 6-4, 6-4, 6-4 comeback win over Daniil Medvedev to win a maiden Grand Slam title at the Australian Open on Sunday, men’s tennis players born in the 2000s have now won more majors (three) than those born in the 1990s (two). Sinner, the unassuming 22-year-old World No 4 from Italy, joins 20-year-old Spaniard Carlos Alcaraz — who won two majors over the past year — as members of the generation that has captured tennis fans’ imagination and leapfrogged the generation of players above it.

The sport is unquestionably going through a transitional moment. The fading of the Federer-Nadal duopoly — the Spaniard will still be planning one last big push for the French Open where he is a 13-time champion this year — has allowed Novak Djokovic to establish himself as the best player in the world. But now at 36, the Serb is facing physical and technical issues of his own, and while the generation below him, including Sunday’s finalist Medvedev, who became the first player in history to fail to win a major final from a two-set lead twice, has failed to take advantage of his lapses, Gen Z are facing no such issue. Sinner defeated Djokovic in the semifinal in Melbourne this week, while Alcaraz defeated him in a memorable Wimbledon final last year. Both have well-rounded attacking games, and both showed the mental resilience to deal with the pressure of playing five sets in a Grand Slam final.

Djokovic remains the leader of this pack. He lost his first Wimbledon match since 2017 against Alcaraz in the final last year, and bounced back to end his year on a record high. As 10-time champion of Melbourne Park, unbeaten there since 2018 until Sinner took him down this year, expect him to return with a similar fury. Also expect the fiery Spaniard and the laid-back Italian to resist.

THE TIMES OF INDIA

January 30, 2024

What’s ‘Social Justice’?

Politics has emptied the phrase of meaning. Quotas & free cycles are not it

Social justice’ politics abounds. But social justice delivery is often piecemeal, compartmentalised, hobbled by conflicts and for few groups. Stretched and reshaped by political competition, social justice has morphed into a catch-all term for welfare measures and every populist promise made, north to south. Such a superficial sweep empties social justice of its core meaning – equal access to all resources, education to health to mobility, jobs to justice and expression.

Jobs is justice | In talk of uplift and targeted programmes for marginalised, an essential pillar has long been invisibilised. There can be no meaningful social justice without economic justice. Yet, inequality is seemingly entrenched, latest CMIE data showed unemployment rate has climbed to its highest in over two years, joblessness in rural areas has increased. Yet, state after state, party after party, offers as succour quotas or proportional representation in the name of ‘social justice’.

Quotas a dead-end | Once quotas were allowed on criteria beyond social marginalisation, it opened the doors for even well-off communities to claim similar ‘benefits’ – but what is the stuff of such benefits beyond periodic handouts? Making thinner and thinner slices of a shrinking economic pie is unsustainable. As economic inequality grows, so do quota demands. Who has the roadmap post-quota?

Nothing new | That said, post-globalisation, welfarism is universal politics – there is no ‘newness’ to a govt or political parties designing leg-ups, trickle-downs, affirmative actions or handouts, whether dole, or insurance, gas cylinders or cash benefits, bicycles or laptops. Fact is, social justice in its true form remains as peripheral as the communities that need it most.

Diversity without equity | India’s fabled diversity is a tapestry of its fault lines – caste, tribe, religion, ethnicity, region, language, gender. Leave these aside for a minute. Two relatively modern marginalised populations where several fault lines dovetail are seasonal migrants and undertrials behind bars who can’t afford bail. Both growing, both without access to basic rights. Who looks out for them, who protects their right to proper wages or legal help? It is this that lies at the core of social justice – equity.

Votes, women & jobs | Economic empowerment, the world of work, is central to real social justice. India-style ‘social justice’ is perhaps best demonstrated by the fact that women’s turnout during elections is ever-increasing while their actual participation in the workforce is in alarming decline.

THE TIMES OF INDIA

January 30, 2024

Mona Lisa Shrugs

Rads grow up. Throwing stuff at famous artworks is plain silly

All art meets diverse responses. Likewise, there can be many interpretations of the scene in which environmental protesters hurled soup at da Vinci’s Mona Lisa this weekend. But two facts are indisputable. First, this was not at all an act of originality. Second, the protesters’ connective logic fails even kindergarten standards.

Imitation | Rad (radical, in case you didn’t know) climate protesters have already directed soup at Vermeer’s Girl with a Pearl Earring and van Gogh’s Sunflowers and fed mashed potatoes to Monet’s Haystacks. And these were themselves copycat acts. Mona Lisa in particular has a long history of being attacked. An angry Japanese woman once threw red paint at it and an angry Russian woman a teacup.

Misdirection | These desecrations draw tons of publicity. Beyond this, their relationship to august activisms breaks down. When Gandhi went on the salt march or Rosa Parks refused to give up her bus seat to a white person or when an indigenous community protects its forest from being cut, the immediate and real targets of protest are very clear. But how is a painting to blame for global warming?

Asymmetry | One of the Louvre vandals asked, “What is more important? Art or the right to have a healthy and sustainable food system?” Ironically, that’s exactly like authorities responding to complaints against polluted air and water, by asking citizens to choose between environment and development.

Global economic growth has piggybacked on fossil fuels and emissions for two centuries. Today we want to cut both these without cutting growth. Campaigning for better climate actions is a wonderful public service. But what does shaming the same public for enjoying the finer things in life achieve? Art is not Nature’s enemy. It can deepen human connectedness to the environment.

THE ECONOMIC TIMES

January 30, 2024

Have a Human Ghost In the AI Machine

Bots need a human hand to judge arguments

The primary concern over popularising generative AI is elimination of bias that creeps in on account of the human-generated content they train upon, and the human feedback involved in aligning the output to accepted values. AI’s response to the question of which month follows January on the calendar is consistent. But the response to whether Julius or Augustus was the better Caesar will depend on what the machine has been ‘reading’. Technology companies argue this should not matter, considering the wealth of interpretation already available. However, it does become important when humans have not had time to form their opinion, such as in the slipping and sliding terrain of current affairs. Or, if some interpretations were denied to AI.

These denials can emerge in the economic, political and cultural contexts. IP is a big hurdle for LLMs, with most liberal news sites in the US being more prickly about scraping content — to the advantage of right-wing media outlets happy to ‘share’ their views for AI amplification. Access can also be restricted, as China does, through government intervention on public use of AI training models. Delayed deployment of generative AI in specific languages also reinforces the majoritarian bias. Persian and Hebrew bots could diverge over the causes of the Red Sea crisis. From a technology creator’s perspective, though, the bigger worry is the human intervention needed at AI’s current stage of evolution to ensure its output does not hallucinate and is consistent. Bots are not smart enough yet to tell truth from falsehood. They also need to be guided in judging the merits of an argument.

To be functional, AI will have to become far more responsible than it is now. Lawmakers can aid the process by seeking transparency in product and process development. But they are unlikely to be able to ensure global access to training models without harmonised rules. The world is going through an AI race with differing approaches on how to push individual teams along. The winner will have to jump over man-made hurdles.

THE ECONOMIC TIMES

January 30, 2024

Make the Move On a Two-State Solution

The preliminary ruling by the International Court of Justice (ICJ) on Thursday in a genocide case brought by South Africa against Israel on its military campaign in Gaza is a tightrope walk. ICJ’s ruling allows both South Africa and Israel to claim victory. On reflection, the court may not have acted on South Africa’s demand ordering Israel to immediately end its military campaign, but it takes steps that can allow for a real solution. It asks Tel Aviv to provide urgently-needed basic services and humanitarian assistance in Gaza and expresses concern about hostages held by Hamas and calls for their release. This balance offers countries like the US and India, and the EU, to push for a negotiated solution that gives peace in the region a real chance.

The genocide case will take years to resolve. This preliminary ruling is about preventing further harm. The ruling, binding on all parties, therefore, provides an opportunity to undertake actions critical to demonstrating that the rules-based global order serves all, and not just the powerful countries. As part of implementing the court’s order, major powers must push Israel to initiate discussions and negotiations with Palestinian Authority (PA) for a political settlement that lays the foundation of the two-state solution. The ICJ ruling has the capacity to restore the developing world’s faith in the international system provided the West demands that Israel abide by the conditions.

India’s relationship with Palestine and Israel, its support for a two-state solution and as an important voice of the developing world, should encourage New Delhi to initiate a diplomatic and political resolution. The ICJ ruling can be the opening the world needs to resolve this decades-long vexed situation.

THE HINDU BUSINESSLINE

January 30, 2024

Complete disarray

The Opposition alliance appears to be crumbling

Bihar Chief Minister Nitish Kumar has dealt a huge blow to Opposition unity by switching sides for a record fifth time in about a decade. The possibility that the Opposition INDIA constituents can present a collective alternative to the BJP behemoth in the general elections seems rather bleak now. Meanwhile, Nitish has been quixotic as ever. For someone who nursed ambitions of emerging as the Opposition’s prime ministerial candidate, Nitish has chosen to play the BJP’s script to a perfection.

For one, he has contributed significantly to the perception that the ruling party’s victory is inevitable. Second, he has bolstered the BJP’s prospects in Bihar by dumping the alliance of Rashtriya Janata Dal, Congress and Left parties, altering the ‘caste arithmetic’ in the BJP’s favour. Right since its inception, the INDIA bloc has never really had a coherent political programme or leadership to offer against the BJP’s purposeful rath steered by Prime Minister Narendra Modi. Yet arithmetically, the idea of a joint Opposition candidate in each Lok Sabha constituency to fight the BJP did offer some promise. With Mamata Banerjee in West Bengal and Aam Aadmi Party (AAP) in Punjab and Haryana deserting the alliance and now Nitish switching sides in Bihar, even that arithmetic is coming apart.

If this is what the national picture looks like, Kumar’s desertion could have a tangible impact in Bihar as well, where the Opposition alliance had nursed hopes of denting the BJP’s overall tally. The BJP had secured 39 of the 40 Lok Sabha constituencies in Bihar in 2019 elections in alliance with Kumar’s Janata Dal (United) which secured 16 seats. Internal surveys of the BJP after Kumar’s desertion to the RJD camp were disappointing, suggesting that the saffron party would not cross 25 seats. The State needed some attention. A Bharat Ratna for socialist icon Karpoori Thakur could help consolidate the BJP’s position. Nitish’s addition to the NDA camp not only brings his Kurmi support base, but also the extremely backward castes and the most backward classes.

The other politically critical States where the Opposition alliance was looking to contain the BJP were Maharashtra and West Bengal. In Maharashtra, the BJP and Shiv Sena combine had won 41 of the 48 Lok Sabha seats in the 2019 elections; a split in the Sena caused a significant dent in this equation. However, ED raids and property seizures have triggered confusion in the INDIA alliance. The desertion of Sharad Pawar’s nephew Ajit Pawar to the BJP camp is seen in this context. Kumar’s exit has raised concerns over the future actions of INDIA constituents in Maharashtra, specifically the NCP. In West Bengal, which sends 42 MPs to the Lok Sabha, the BJP is looking to retain its 18-seat tally in the 2019 elections. Mamata Banerjee going solo creates a split in the opposition votes which had helped the BJP win at least six seats in the 2019 elections. So, for now it is advantage BJP.

BUSINESS STANDARD

January 30, 2024

Questions on China

Evergrande liquidation would be keenly watched

On Monday, a judge in Hong Kong, which is officially part of China but has an independent legal system based on British principles, ruled that the liquidation process should begin for property major Evergrande Group. The developer was once the favoured child of mainland China’s property boom, but it has as swiftly become emblematic of the real estate bust, which has cast a shadow over the country’s economic prospects. Once worth hundreds of billions of dollars, Evergrande has now lost almost all its value because it is encumbered with scores of half-built properties that may never get off its balance sheet. The order may have come more swiftly than authorities in Beijing may like. China’s leaders are still trying to postpone a permanent resolution of the housing crisis. The judgment now raises three unsolved questions, each of which has enormous implications for investment in China and the nature of its growth.

The first question is on the future of Hong Kong. The mainland has benefited tremendously from Hong Kong’s reputation over the past decades. Companies with businesses across China have been able to list and raise money in the former British possession, providing financiers with the comfort that any problems that they run into might be settled through a dispute resolution process conducted by a transparent judiciary and independent institutions under British common law principles that are familiar and investor-friendly. Yet there is every chance that the Evergrande judgment might not be applied swiftly in the mainland, if at all. If it turns out that Hong Kong courts do not really have sufficient legal power in the mainland, a benefit that Chinese companies have long taken for granted — the ease of raising capital through a hybrid offshore/onshore location — may evaporate.

The second is on how effectively the Chinese political system can deal with the complicated political economy of bankruptcy. In real estate, where debt-ridden local governments are often the silent partner in large investments, the question of who takes how much of a haircut is particularly complicated. Beijing has not done well when it comes to writing down politically sensitive loans in the past. Partly this is because of the opaque nature of the connections that lie behind successful or unsuccessful investment. But it is also because there may simply be little legal backing for write-downs of public money, or institutional capacity to make the determinations of solvency or seniority that are essential to the process. China needs to get the answers right here if it is ever to have a modern financial system.

The third question is on whether foreign capital will ever be treated properly in China, or it will always have subordinate status when push comes to shove. Investment fled the mainland in recent years, as President Xi Jinping’s economic nationalism has become increasingly strident and intrusive. But the hope has always been that, while investment on the ground may have turned unfavourable for foreigners, the capital markets could continue to serve as a conduit in which foreign and local capital could meet on equal terms. Any hint that Beijing is preventing resolutions that would lead to the repatriation of capital would be deeply unwelcome. Evergrande is being watched as a clue to the future of Chinese real estate. But its implications for the entire structure of the Chinese economy and its integration with the outside world go far deeper.

BUSINESS STANDARD

January 30, 2024

Nitish’s U-turn

INDIA’s future looks bleak

Bihar Chief Minister Nitish Kumar’s third tieup with the Bharatiya Janata Party (BJP), ahead of the Lok Sabha elections, may not change the fortunes of Bihar. After being sworn in nine times as he switched allegiance between the BJP-led National Democratic Alliance (NDA) and Lalu Prasad’s Rashtriya Janata Dal (RJD), governance had taken a distant back seat long ago. In the state’s political affairs, Mr Kumar’s Janata Dal (United), or JD(U), is an influential power despite holding just 45 seats against the BJP’s 78 and the RJD’s 79 in the 243-member Assembly. Bihar’s Assembly elections are not due till 2025 but the real significance of Mr Kumar’s latest embrace of the NDA is an electoral calculus that probably spells the decimation of the Indian National Developmental Inclusive Alliance (INDIA), led by the Congress. Mr Kumar was seen as one of the prominent architects of this alliance. His exit, following the statement last week of Mamata Banerjee’s Trinamool Congress in West Bengal that it will go alone, is a blow from which INDIA will struggle to recover.

Interestingly, both Mr Kumar and Ms Banerjee have complained that former Congress president Rahul Gandhi embarked on a east-to-west journey — the Bharat Jodo Nyay Yatra — without consulting them, including permission to travel through their states. The overall thinking was that the yatra should have been organised under the INDIA banner. The underlying narrative, however, is that neither politician sees the Congress as a viable winning partner in the upcoming Lok Sabha elections, especially after the latter’s heavy losses in the Madhya Pradesh, Rajasthan, and Chhattisgarh Assembly elections. In the 2019 general election, the Congress won one seat in Bihar and two in West Bengal. The exit of the JD(U) from INDIA and the decision of Trinamool to go alone are likely to undermine the bargaining positions of the Congress with other allies in the grouping.

The working principle of the alliance is that the partner with the most seats in the state would be making the decisions on seat-sharing. But there have been accusations that the Congress is trying to browbeat alliance partners in some states. In Kerala and Punjab, for instance, where the Congress is the main opposition to the ruling Left Front and Aam Aadmi Party (AAP), respectively — the BJP has a negligible presence here — the arrangements are uncertain. In Punjab, the chief minister had said AAP would go it alone, even as the party’s high command has said it has reached a preliminary understanding with the Congress. Much will depend on negotiations in Uttar Pradesh, the state with the highest number of seats in Parliament, with Akhilesh Yadav’s Samajwadi Party (SP) saying it has made some headway in talks with the Congress.

The biggest gainer from Mr Kumar’s latest U-turn is the BJP. First by appointing one representative each of the Koeri and Bhumihar castes as deputy chief minister, the party has emphasised its case for caste inclusivity, weakening a core INDIA plank. Bihar was the first state to conduct a caste census, an exercise that had gained traction in INDIA. Second, the BJP and JD(U) together won 33 of the 40 Lok Sabha seats in 2019; 39, when the Lok Janshakti Party’s six seats were added. If this performance is repeated, the ruling alliance would be assured of total control of the Hindi belt with Bihar in the bag.

FINANCIAL EXPRESS

January 30, 2024

FDI in ASEAN

Two-way trade with the fast-growing and prosperous grouping is bound to grow

Thailand’s invitation to leading Indian automakers Tata Motors and Mahindra & Mahindra to set up factories comes at a time when India is reviewing its free trade agreement with the 10-member Association of Southeast Asian Nations (Asean) that was inked 14 years ago as part of its Look East policy. Despite a two-fold rise in trade in goods since then to $131.6 billion in FY 23, India has deep misgivings over this deal as it resulted in a nine-fold increase in its trade deficit with Asean to $43.6 billion.

To kick-start greater trading volumes, India Inc must invest more in Asean, especially in manufacturing and services, more than it is currently doing. Asean receives more foreign investments as a share of GDP than any other region. The member-states are also investing in one another in a big way. In sharp contrast, India has a receding FDI imprint with inflows of only $680 million in 2022 from $4.4 billion in 2010 according to Asean’s data portal. India’s FDI in manufacturing is also negligible at $49 million.

Thailand’s invitation to Tata Motors interestingly comes when the company has exited from its manufacturing presence in that region. In fact, the biggest bets in Asean have been made by the Tata Group when it took over NatSteel in Singapore in 2004 and two years later Millennium Steel in Thailand. To sell its pick-up trucks in the region, Tata Motors chose Thailand for its entry point in 2008. Seventeen years later, the Tatas had sold their stake in NatSteel while retaining the wire business.

In July 2018, Tata decided to stop assembly operations in Thailand as the business was sub-scale and unsustainable. It has now partnered with a leading automotive distributor, Inchcape Plc, to distribute its vehicles in the region. According to a report in FE, Thailand’s trade representative said that Tata Motors could use the country’s eastern economic corridor to set up an export hub for its electric vehicles and batteries. The Group has so far not commented on this invitation. M&M, for its part, plans to sell tractors, but will set up a plant in Thailand only if its sales targets are met.

Although the business environment in Asean is challenging, Tata Motors and others must engage more with the region like the Aditya Birla Group did in the late 1960s and 1970s when it made its pioneering forays into Thailand with the setting up of Indo Thai Synthetics Company. Analysts consider this as part of a first wave of investments by Indian industry in Asean during the pre- liberalisation period. Investments create interdependencies which translate into greater two-way trade volumes. India Inc’s FDI inflows in Asean are declining just when Japan and the US are ramping up their investments manifold and benefitting with booming trade.

India Inc’s most formidable rival in the region is the Chinese diaspora. To seize the bustling business opportunities in Asean, India Inc must better understand the competitive implications arising from this dominance by overseas Chinese businessmen whose entrenched presence provide a strategic advantage to the mainland. China is Asean’s largest trading partner. Asean is the region where global supply chains are relocating especially to member states like Vietnam and Thailand due to Sino-US tensions. There is no alternative to investing more for a substantial uptick and less imbalanced two-way trade with Asean.

FINANCIAL EXPRESS

January 30, 2024

Apple is our hope for making AI more private

There’s a price to pay for all the generative AI tools that professionals are using. It’s not just a subscription fee to OpenAI, Microsoft or some other AI company—it’s their privacy too. Every interaction with a ChatGPT requires a connection to the Internet, and every query is processed on a server in a vast data centre. Your conversation history? That often gets fed back to the AI model to train it further, along with your personal information. That has rankled some employers worried about data security.

But if the “brain” of an AI tool lived within your own computer instead of routing back to someone else’s, the lack of privacy might not be as much of a problem. The great hope for making this happen is Apple.

Building the “smartest” generative AI is all about powerful chips, and while Nvidia Corp. dominates that market for cloud-based servers Apple is well-positioned to be the first to do that successfully on smaller devices, even if it was caught off guard by the generative AI boom. Because although many companies are trying to figure out how to process AI on phones and laptops—without having to connect to a server somewhere—they’re hitting technical limitations that maybe difficult to surmount without the resources of the $3 -trillion hardware company in Cupertino.

Apple has already been designing more powerful chips for its phones and laptops, including the advanced M series chips. The chips that Nvidia builds for processing AI on servers are still far more powerful, but that might be OK if AI models themselves become smaller and more efficient. That points to another phenomenon driving the on-device trend: While leading AI builders like OpenAI and Alphabet’s Google are focused on making their models as big as possible, many others are trying to make them smaller and more energy-efficient. Over the last few years, OpenAI found that it could make its large language models sound much more fluent and humanlike if it simply increased the parameters of its models and the amount of computing power that they used, requiring huge cloud servers with powerful chips.

To put that into perspective, OpenAI’s GPT-4 was rumoured to have more than 1 trillion parameters, while Amazon is reportedly working on a language model called Olympus that has 2 trillion. But Mistral, a French AI startup founded by former research scientists at Google DeepMind and Meta, is working on language models with a fraction of that number: Its latest open-source language model has a little over 40 billion parameters, but operates just as well as the current free version of ChatGPT (and its underlying model GPT-3.5), according to the company.

Some software developers are capitalising on Mistral’s work to get the ball rolling on more private AI services. Gravity AI, a startup based in San Francisco, recently launched an AI assistant that works on Apple laptops and needs no internet connection. It’s built on Mistral’s latest, smaller model and works similarly to ChatGPT. As a business model, on-device AI promises better margins than AI services that need to be linked to the cloud. That’s because developers have to pay cloud providers huge sums each time a customer uses their AI tool. “I spoke with a founder who is building a similar [AI] tool in the cloud, ‘‘Gravity co-founder Tye Daniel says. “He said/The only way we make money is if people don’t use the product”. That might sound counterintuitive, but even OpenAI’s Sam Altman has complained about the painful costs of running ChatGPT for his customers.

Apple is also working on making AI models smaller, so that it can run them on its own devices. That’s very much in keeping with its walled-garden approach to every thing it builds. Here’s where things get a little technical, and where more private AI might yet remain a pipe dream for many months or even years. Large language models don’t just need processing power but also memory to work well—and even on the most robust laptops and phones, these AI tools are hitting a so-called “memory wall.”

All eyes are now on Apple to see if it can solve this technical quandary. AI models aren’t just private, but cheaper to run and better for the environment given all the carbon that server farms belch into the air. Apple needs to move quickly if it’s going to shrink powerful AI models onto its phones: Smartphone sales are stagnating globally, and its arch-rival Samsung is already finding success in distilling AI models down too. If Apple succeeds, that could kicks tart a shift in the AI field that benefits more parties than the one in Cupertino.

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