Arvind’s Newsletter

1.Indian Cabinet approves India's first semiconductor fab by Tata Group and Taiwan's PSMC, reported Mint

The Union Cabinet approved the country's first semiconductor fab to be made by the Tata Group in collaboration with Powerchip Taiwan. The semiconductor fab will come up in Dholera with a capacity of 50,000 wafers per month, said IT minister Ashwini Vaishnaw on February 29.

A net investment of ₹27,000 crore will go into the fab. 48 million chips per day will be produced from the unit, once the full capacity is reached.

A separate news item in Business Standard, reported the Indian Cabinet clears 3 semiconductor plants with investment of Rs 1.26 trillion, including above mentioned Tata project.

The Union Cabinet on Tuesday approved Rs 1.26 trillion worth of investments in three semiconductor fabrication plants, including a Tata group proposal to build the country’s first major chipmaking facility at Dholera in Gujarat. 

It also cleared a separate Tata proposal for a chip assembly plant in Morigaon, Assam, and another by CG Power in Sanand, Gujarat. The work on all three projects is expected to begin in the next 100 days.

2.India's Q3 GDP growth at 8.4%, beats D-Street estimates; economy grows at fastest pace in 6 quarters

The Indian economy grew 8.4 per cent during the October-December quarter of the current financial year 2023-24 (Q3FY24), remaining the fastest-growing major economy in the world, according to gross domestic product (GDP) data released by the Statistics Ministry on Thursday, February 29. The rise in GDP growth was supported by robust growth in manufacturing and construction sectors, along with high domestic demand.

The GDP growth in the December quarter rose sharply above D-Street estimates along with growth projections by the Reserve Bank of India (RBI). The RBI had maintained real GDP growth for 2023-24 at 7 per cent with Q3 at 6.5 per cent and Q4 at 6 per cent. 

Double-digit growth in the manufacturing sector, followed by a good growth rate of construction sector" were responsible for the better-than-expected performance, said the NSO. The manufacturing sector, which for the past decade has accounted for just 17 per cent of Asia's third-largest economy, expanded 11.6 per cent year-on-year in the December quarter. 

Private consumption rose 3.5 per cent in the December quarter from a year earlier, while government expenditure contracted 3.2 per cent. Investment surged 10.6 per cent in the quarter from the year-ago period.

3.Celebrating Leap Day

Yesterday was leap day Feb. 29, a date observed only once roughly every four years in the international standard Gregorian calendar. While the extra day serves a technical function, its uniqueness prompts celebrations around the world—especially by the estimated 5 million Leaplings born on the rare day.

Leap years are necessary because the Earth takes slightly longer than 365 days to revolve around the sun—roughly five hours and 48 minutes more. For millennia, agricultural societies using a solar calendar to schedule plantings and harvests saw the seasons drift over time and instituted the extra day to compensate. The Romans made the current leap year approach official under Julius Caesar, but that calendar was overhauled 1,500 years later by Pope Gregory XIII because the seasons had drifted off by roughly 10 days.

In contrast, China's cultural calendar utilizes a leap month every three years. The Hindu calendar offers both lunar and solar time reckoning. To keep the two in sync, months and days are frequently added or omitted.

4.Wendy’s walked back potential plans to introduce surge pricing. 

The U.S. fast food chain had previously said it would begin testing “dynamic pricing” in 2025, a strategy used by ride-hailing firms, airlines, and other businesses to boost prices at times of high demand. But after an internet backlash, the company said its statement was “misconstrued,” and that their new digital menu boards would simply “give us more flexibility to change the display of featured items.”

Surge pricing is famously unpopular — customers don’t like unexpected price hikes. Customers might be more receptive if Wendy’s offered lower prices at times of low demand: They could call it “happy hour.”

5.Bitcoin price surges

Bitcoin pushed past $60,000 for the first time in more than two years on Wednesday and has jumped about 40% already in 2024. The feeling has been that maybe things are different this time around. The current rally was triggered mostly by the successful launch of US exchange-traded funds that hold the coins—vehicles that have attracted more than $6 billion since they began trading Jan. 11. But at the heart of this particular rally is a simple tenet of economics: Supply and demand. The surge in demand for the cryptocurrency resulting from new ETFs is vastly outstripping the supply of new tokens being created in the mining process, as well as the Bitcoin long-time holders are willing to sell. That is what’s set the crypto market on fire of late, with fuel being added from traders chasing the upward momentum and loading up on leveraged bets that the surge will continue.

6.Israel is losing its greatest asset: Acceptance

“Hard to believe, but Netanyahu is ready to sacrifice Israel’s hard-won international legitimacy for his personal political needs. He will not hesitate to take Biden down with him." Tom Friedman in the NYT 

"I don’t think Israelis or the Biden administration fully appreciate the rage that is bubbling up around the world, fueled by social media and TV footage, over the deaths of so many thousands of Palestinian civilians, particularly children, with U.S.-supplied weapons in Israel’s war in Gaza. Hamas has much to answer for in triggering this human tragedy, but Israel and the U.S. are seen as driving events now and getting most of the blame."

7.India's EV revolution is spreading from autorickshaws to motorbikes

Unlike the US where luxury cars are electrifying first, India is moving in the opposite direction. Electrification of conventional cars and SUVs is still moving at a snail’s pace, winning just a 2% share of four-wheeler sales last year. E-rickshaws aren’t just cleaner and quieter — they’re more profitable, too, and sales are exploding. By 2030, batter-powered two-wheelers could account for 60% of sales. When the EV revolution arrives in India, it will come from the bottom up.

8.Anthropic released Claude 3, its latest suite of artificial intelligence models. 

The Amazon- and Google-backed research company claimed that the most powerful model in the family, the subscription-only Opus, outperforms OpenAI’s GPT-4 and Google’s Gemini on various benchmark tests.

Earlier Claude versions had a tendency to refuse to answer even harmless prompts, but the new models are reportedly better at distinguishing between harmful content and inoffensive questions, an issue that has plagued other new AI releases: Gemini caused an uproar by depicting Nazi soldiers and 19th-century U.S. senators as Black.

Anthropic believes it has walked the line. Whether that assurance survives the models’ first contact with consumers remains to be seen.