Arvind's Newsletter

1.India’s core sector output grows 3.8% in March, the highest in two months

The output of eight core infrastructure sectors, which account for two-fifths of India’s industrial output, expanded by 3.8% annually in March—the highest in the last two months.

A year ago, in March 2024, core sector output expanded by 6.3%.

However, only three of the eight core industries—electricity, cement and steel—reported a monthly rise in production during March, according to the provisional data released by the ministry of commerce and industry on Monday.

2.Airtel Tops Subscriber Additions In January As Vodafone Idea, BSNL See Losses

Telecom user base in the country increased marginally to 1,190 million in January with Airtel leading the chart in new subscriber additions across wireline and mobile segments, according to a Trai report.

Bharti Airtel led additions during the month with a net gain of 16.5 lakh users, followed by Jio, which added 6.86 lakh subscribers. Vodafone Idea lost 13.4 lakh users, while BSNL lost 1.52 lakh.

3.Air India Keen to Take Boeing Planes Refused by Chinese Airlines

Air India is looking to acquire Boeing planes that were originally intended for Chinese carriers but were rejected due to the trade war between Washington and Beijing.

The airline is interested in taking up slots for future deliveries and has already accepted 41 737 Max jets originally built for Chinese airlines.

The Tata Group-owned carrier, which urgently needs aircraft to expedite its revival, plans to approach Boeing about acquiring a number of jets the US planemaker was readying for Chinese airlines before reciprocal tariffs thwarted the handovers,

Air India is also eager to take up slots for future deliveries should they become available, the people said.

4.FPIs make strong comeback, infuse Rs 8,500 crore into Indian market in a week

Despite a Rs 2,352 crore pullout on April 15, subsequent buying worth Rs 10,824 crore signalled a sharp rebound. Analysts attribute this reversal to a weakening US dollar and India’s relatively strong 6% growth outlook amid global trade tensions. Still, FPIs have withdrawn Rs 23,103 crore so far in April, taking the total outflow since January to Rs 1.4 lakh crore, reflecting the cautious sentiment around US tariff shocks and global economic uncertainty.

Domestic investors put in a record $72bn during the year to the end of March, while foreign investors pulled out $14.6bn, according to the National Stock Exchange of India. The massive inflows by what the markets regulator once called “elusive” retail investors have taken domestic holdings to more than 26 per cent of the market, compared with foreigners’ 17 per cent as of December 31.

The balance is held by company founders, domestic insurance companies and the state. The resilience of retail investors shows the growing maturity of India’s stock market and its ability to decouple from international capital flows. The Nifty 50 index has largely recovered losses after Trump’s “liberation day”, making India’s market the strongest to rebound from the tariff turmoil.

Industry groups said the change reflected Indian investors pivoting away from low-interest fixed deposits and increasingly viewing local equities as viable long-term investments. Growth in mutual funds’ assets under management outstripped a rise in bank deposits between 2019 and 2024, the Association of Mutual Funds in India (Amfi) said in a report last month.

5.Pope Francis — the leader of the world’s Catholics, seen as a progressive in an otherwise conservative institution — died, aged 88. 

He had spent an extended period in hospital  in February, but returned to partial duties and met with worshippers on Easter Sunday. Born Jorge Mario Bergoglio, the pontiff was a path-breaking leader.

The first pope from the Americas or the Southern Hemisphere, and the first Jesuit, he championed social causes, appointed 140 cardinals from non-European countries, and was outspoken on political issues.

For 12 years, Francis led more than one billion Catholics and reshaped the faith to make it more inclusive. He clashed with traditionalists as he reached out to migrants, gay Catholics and victims of sexual abuse by Catholic clergy. He sought to improve relations with Muslim clerics. He criticized the powerful for their role in climate change and called for an end to wars. 

Indeed, one of his last meetings was with US Vice President JD Vance, following which he issued an Easter speech outlining a worldview that The Washington Post noted was “in stark contrast ” with that of the Trump administration.

6.China’s CATL says it has overtaken BYD on 5-minute EV battery charging time

CATL has unveiled upgraded battery cells it claims can offer faster charging for electric vehicles than its rival BYD, putting the two Chinese groups ahead of competitors in the race to overcome a major barrier to the shift away from petrol vehicles.

The world’s biggest electric vehicle battery maker said on Monday that a new version of its flagship Shenxing battery cell could offer a 520km range from just five minutes of charging time.  Last month, BYD shocked the industry by unveiling a charging system that could add about 470km in range to its batteries in about the same time.

The claims by the Chinese battery groups would put them ahead of major western rivals. At present, Tesla vehicles can be charged up to 200 miles (321km) in added range in 15 minutes, while Germany’s Mercedes-Benz recently launched its all-electric CLA compact sedan, which can be charged for up to 325km within 10 minutes using a fast-charging station. 

Analysts have said the deployment of high-speed charging systems from BYD and CATL will help to eradicate consumer fears about EV driving range, even though there are questions as to how fast the companies can bring these technologies outside China amid rising geopolitical tensions. 

The second generation of the Shenxing battery, which boasts a range of 800km on one charge, can achieve a peak charging speed of 2.5km per second, the company said at a media event ahead of this week’s Shanghai auto show.

7.The dollar weakened and US stock futures fell as traders returning after the Easter weekend digested renewed reports that President Donald Trump wants to fire the chair of the Federal Reserve Powell.

While legal scholars say that a president can’t dismiss a Fed chair easilu and Powell has said he wouldn’t resign if asked by Trump, the latest comments coming from the White House are forcing investors to reckon with the implications of Powell’s dismissal. 

“If the credibility of the Fed is called into question, it could severely erode confidence in the dollar,” said Christopher Wong, strategist at Oversea-Chinese Banking. 

On Friday, National Economic Council Director Kevin Hassett said Trump was studying whether he’s able to fire Powell. The comments came a day after the president publicly criticised the head of the central bank for not moving fast enough to slash interest rates. Trump has been asking those around him about the possibility of removing the Fed chair, according to people familiar with the matter.

8.Daily Weight Loss Pill

Pharmaceutical giant Eli Lilly announced yesterday that the pill form of its popular weight-loss and diabetes injectables proved effective and safe in a clinical trial, pushing the company's shares up 14%. The industry has faced a surge in demand amid the popularity of drugs like Zepbound and Mounjaro and is seeking cheaper, easier-to-use alternatives to the weekly shot versions, which cost roughly $1300 a month without insurance.

Glucagon-like peptide-1 agonists mimic a gut hormone to activate insulin production and suppress appetite. Clinical trials and customer testimony have repeatedly indicated their efficacy, with the average user seeing weight loss of at least 10% (in addition to a slew of secondary benefits).  

Eli Lilly’s daily pill, known as orforglipron, resulted in average weight loss of nearly 8% over 40 weeks in hundreds of Type 2 diabetes patients, compared to a placebo decrease of 1.7%. Roughly 65% of patients also saw blood sugar levels reach a normal level. Orforglipron has no food and water restrictions, unlike Rybelsus from Novo Nordisk (the maker of Ozempic and Wegovy), which requires fasting.

9.China’s First Robot Marathon Runners Trip, Emit Smoke, Fall Apart

 About 12,000 human athletes ran in a half marathon race in Beijing on Saturday, but most of the attention was on a group of other, more unconventional participants: 21 humanoid robots. The event’s organizers, which included several branches of Beijing’s municipal government, claim it’s the first time humans and bipedal robots have run in the same race, though they jogged on separate tracks. Six of the robots successfully finished the course, but they were unable to keep up with the speed of the humans.

The fastest robot, Tiangong Ultra, developed by Chinese robotics company UBTech in collaboration with the Beijing Humanoid Robot Innovation Center, finished the race in two hours and 40 minutes after assistants changed its batteries three times and it fell down once.

10.How a dollar crisis would unfold; The Economist

THE DOLLAR is meant to be a source of safety. Lately, however, it has been a cause of fear. Since its peak in mid-January the greenback has fallen by over 9% against a basket of major currencies. Two-fifths of that fall has happened since April 1st, even as the yield on ten-year Treasuries has crept up by 0.2 percentage points. That mix of rising yields and a falling currency is a warning sign: if investors are fleeing even though returns are up, it must be because they think America has become more risky. Rumours are rife that big foreign asset managers are dumping greenbacks.

For decades investors have counted on the stability of American assets, making them the keystones of global finance. The depth of a $27 trn market helps make Treasuries a haven; the dollar dominates trade in everything from goods and commodities to derivatives. The system is buttressed by the Federal Reserve, which promises low inflation, and by America’s sturdy governance, under which foreigners and their money have been welcome and secure. In just a few weeks President Donald Trump has replaced these ironclad assumptions with stomach-churning doubts.

This crisis-in-the-making was created in the White House. Mr Trump’s reckless trade war has raised tariffs by roughly a factor of ten and created economic uncertainty. Once the envy of the world, America’s economy is now courting recession, as tariffs rupture supply chains, boost inflation and punish consumers.

This comes as America’s historically bad fiscal position is becoming even worse. Net debts stand at about 100% of GDP; the budget deficit over the past year, of 7%, was astonishingly high for a healthy economy. Yet in its quest to renew and extend tax cuts from Mr Trump’s first term, Congress wants to borrow still more. On April 10th it approved a budget blueprint that could add $5.8trn in deficits over the next decade, according to the Committee for a Responsible Federal Budget, a think-tank. That would boost the deficit by another 2 percentage points and exceeds the combined total value of Mr Trump’s first-term tax cuts, the extra spending in the covid-19 pandemic and Joe Biden’s stimulus and infrastructure bills. It could double the pace at which the debt-to-GDP ratio rises in the coming years.

What makes this economic downturn and the loss of fiscal discipline so explosive is the fact that markets are starting to doubt whether Mr Trump can govern America competently or consistently. The shambolic, incoherent way the tariffs were calculated, unveiled and delayed was a mockery of policymaking. On-again, off-again exemptions and sectoral tariffs promote lobbying. For decades America has carefully signalled its dedication to a strong dollar. Today some White House advisers are talking about the reserve currency as if it were a burden to be shared—using coercion if necessary.

Inevitably, this puts the Federal Reserve under strain. Mr Trump is pressing the central bank to cut interest rates. The courts are likely to stop him sacking Fed governors at will, but he will be able to nominate a pliant new Fed chair in 2026. Meanwhile, the president’s other policies—such as shipping undocumented migrants to El Salvador without a hearing, or harassing law firms that displease him—make it possible to think that foreign creditors’ rights could suffer.

All this has created a risk premium for American assets. The shocking thing is that a full-blown bond-market crisis is also easy to imagine. Foreigners own $8.5trn of government debt, a bit under a third of the total; more than half of that is held by private investors, who cannot be cajoled by diplomacy or threatened with tariffs. America must refinance $9trn of debt over the next year. If demand for Treasuries weakens, the impact will quickly feed through to the budget, which, owing to high debts and short maturities, is sensitive to interest rates.

What would Congress do then? When markets collapsed during the global financial crisis and the pandemic, it acted forcefully. But those crises required it to spend, not to impose cuts. This time it would need to take an axe to entitlements and raise taxes quickly. You need only consider the make-up of Congress and the White House to see that the markets might have to impose a lot of pain before the government could agree on what to do. As America dithered, the shock could spread from Treasuries to the rest of the financial system, bringing defaults and hedge-fund blow-ups. That is the sort of behaviour you would expect in an emerging market.

The Fed, for its part, would face a painful dilemma. It could buy assets to steady the ship. But it would not want to appear to be monetising the debt of an uncreditworthy government—an especially risky move when inflation is high. Could it strike the balance between emergency lending and monetary financing? And if it was not bailing out Mr Trump, would he approve of it lending dollars to foreign central banks that lack liquidity, as it usually does in a crisis?

A currency is only as good as the government that backs it. The longer America’s political system fails to grapple with its deficits or flirts with chaotic or discriminatory rules, the more likely will be a once-in-a-generation upheaval that pushes the global financial system into the unknown. Wherever things settled, the greenback’s diminished role would be a tragedy for America. True, some exporters would benefit from a weaker currency. But the dollar’s primacy reduces the cost of capital for everyone, from first-time homebuyers to blue-chip firms.

The world would suffer because the dollar has no equal—just pale imitations. The euro is backed by a big economy, but the euro zone does not produce enough safe assets. Switzerland is safe but small. Japan is big, but has its own vast debts. Gold and cryptocurrencies lack state backing. As investors tried one asset and then another, the hunt for safety could bring about destabilising booms and busts. The dollar system is not perfect, but it provides the stable ground on which today’s globalised economy is built. When investors doubt America’s creditworthiness, those foundations are in danger of cracking. ■