Arvind's Newsletter - Weekend edition

1.Foreign investors offloaded $1,776 million, or Rs 14,768 crore, worth of stocks in September, according to data from NSDL, reported BloombergQuint. The sectors that saw The Biggest Foreign Outflows In September were Power ($ 1172 mn), Oil and Gas ($630 mn), Metals and Minerals ($ 609 mn), Construction Materials ($407 mn) and Telecom Services ($229 mn).

On the other hand, there was inflows into Capital Goods($614 mn), Consumer Services ($413 mn), Financial Services ($345 mn) and IT services $227 mn).

Even after experiencing foreign fund outflows in September, India is still the largest recipient of FPI flows so far this year among emerging markets at $ 14.8 bn. The FPIs were sellers in Thailand, Taiwan, the Philippines, Malaysia, Indonesia, and Vietnam, according to Bloomberg data.

2.Another disaster foretold- this time in Sikkim

Uttarakhand, 2021: A chunk of the Nanda Devi glacier—"15 football fields long across”—collapses, triggering avalanches and floods that damage two controversial hydroelectric projects in Chamoli district. The disaster results in over 200 people dead or missing. It’s believed that an early warning system could have saved lives.
Sikkim, 2023: A glacial lake outburst flood (GLOF) in South Lhonak Lake (SLL)—triggered either by torrential rains or the recent Nepal earthquakes—virtually washes away the controversial 1200 MW Teesta 3, Sikkim’s largest hydropower project. Fourteen people have died and 102 are missing. It’s believed that an early warning system could have saved lives. What we now hear is that an early warning system was in the works

3.Amazon challenges Starlink dominance in satellite internet service

Amazon is launching its first satellites today in a bid to start competing with SpaceX’s Starlink satellite internet service. Project Kuiper will eventually form a mega-constellation of 3,200 satellites, 300 miles above the Earth. But for now, just two, KuiperSat-1 and KuiperSat-2, will launch from Cape Canaveral in Florida in a test. Starlink, part of Elon Musk’s SpaceX, already has 5,000 satellites and 2 million users — in order to challenge it, Amazon “essentially bought up all the spare launch capacity in the world on every available non-SpaceX rocket,” committing $10 billion to the project, New Scientist reported.

4.A sixth basic flavour may have been discovered. The five established basic flavors are salt, sweet, bitter, sour, and umami, a Japanese word meaning “a pleasant savory taste.”They relate to simple chemicals: For instance, sweetness is produced by sugars; saltiness by metal ions such as those in table salt; sourness by acidity. Glutamate, an amino acid, creates umami.

Now scientists at the University of Southern California think they have found that taste-bud receptors also respond to aluminium chloride, a chemical found in many waste products which could signal toxicity. That said, some humans may like it: Ammonium chloride is a key ingredient in salt licorice, a popular candy in Scandinavia.

5.The Financial Times has a long report on , “The looming data centre crunch.” The functioning of the internet, and modern life, relies on hubs of processors and servers but demand is outpacing capacity. Some extracts from this article:

Every email sent, photo or video captured, crypto token traded and online article published adds to the growing mass of digital data worldwide. Last year alone, nearly 100tn gigabytes of data were created and consumed, according to market researcher International Data Group, equivalent to 4.5tn times the entire text contents of Wikipedia. And the figure will nearly double again by 2025. Powering this growth are the energy-intensive data centres around the world that process, host and store digital information but which are fast becoming insufficient in capacity.

Developers are scrambling to expand existing centres or to build new ones in order to meet demand. An ever-growing number of people and devices are connecting online; streaming services such as Netflix and Spotify have millions of concurrent users; and the advent of cryptocurrencies and their processing-heavy mining methods have all added to the strain. Bitcoin mining and trading consumed almost triple the electricity of the entire island of Ireland last year, the Cambridge Centre for Alternative Finance estimates.

Our reliance on data centres for the functioning of modern life will only become more entrenched. In the years to come, “two of the bigger drivers would be AI and the internet of things”, says Petroc Taylor, a research analyst for Statista covering data centres and telecoms. “These AI algorithms need massive amounts of training data, as they become more complex, they [will] need more data filtered in.”

Solving the looming data centre crunch isn’t as simple as just building new operations, or expanding existing ones. Developers must overcome hurdles including local planning restrictions, the need for increased electricity generation and upgrades to national transmission systems. In the regions that host clusters of data centres, these constraints are limiting the development of new centres, potentially forcing developers to look elsewhere.

Data centres have various different ownership structures. Organisations can build and operate their own data centres for their own specific needs, and this can be preferable for security-sensitive government or military operations. On the other end of the scale, server space can be rented for short durations from companies that own and operate data centres known as “cloud providers”, such as a Amazon Web Services or Google Cloud. Regardless of how they operate, all data centres require a large supply of reliable electricity to power their hardware and cooling systems. While data centre energy efficiency has improved substantially in the past decade, the ever-growing demand for data has driven increases in overall power usage.

Due to factors such as geography, climate and access to a skilled workforce, data centres tend to be geographically clustered; big hubs include Dublin, Amsterdam, Zurich and Virginia. Structure Research, a consultancy with a focus on internet infrastructure, estimates data centres consumed electricity equal to about 1 per cent of the world’s total energy demand last year. However, due to the clustering the electricity demand isn’t equally distributed around the world.

The most active hubs have “links to the fibre backbones that are going across different continents”, says Turner, who has also researched the specifics of the Irish data centre market. “That’s where places like Amsterdam and Dublin really win out, because they have a lot of fibre routes converging in one place.”

Technology companies concerned about how this level of demand affects the environment are planning for and investing in more sustainable cloud services.

Data centres are emerging as important wholesale power market players, capable of influencing the direction of power generation investment.

In April, Google made a direct purchasing power agreement to buy 150 megawatts of wind energy from Ørsted, a Danish energy company operating wind farms in the US.

Such power agreements made by data centre operators can help secure the financing for construction by guaranteeing a fixed income stream to clean energy providers for a number of years.