Arvind's Newsletter-Weekend edition

1.India faces 'problem of plenty' from foreign inflows post bond index inclusion, US rate cuts

Indian sovereign debt is set to see sizeable foreign inflows in 2024-25, but the local currency may not appreciate much due to the Reserve Bank of India (RBI) exercising close control over the exchange rate, reported MoneyControl/

Starting June, Indian government bonds will become a part of JPMorgan's Government Bond Index-Emerging Markets (GBI-EM) global index suite, which is seen bringing in foreign money to the tune of nearly $25 billion into local debt over a 10-month period.

The index is about $230 billion. India's weight is about 10 percent, so $25-30 billion of additional flows (could come). And I think that there will probably be limited appreciation from just that quantum," Chetan Ghate, director of Institute of Economic Growth and former member of the Monetary Policy Committee (MPC).

Ashima Goyal, Emeritus Professor at Mumbai's Indira Gandhi Institute of Development Research and a current member of the MPC, added that considering the inclusion of Indian debt into JPMorgan's indices will be over a period of 10 months, the development is unlikely to "create any volatility" and that it will be absorbed.

2.OpenAI unveiled an artificial-intelligence model that can turn text prompts into video, reported MIT Technology Review

OpenAI has built a striking new generative video model called Sora that can take a short text description and turn it into a detailed, high-definition film clip up to a minute long.

Based on four sample videos that OpenAI shared with MIT Technology Review ahead of today’s announcement, the San Francisco–based firm has pushed the envelope of what’s possible with text-to-video generation/

“We think building models that can understand video, and understand all these very complex interactions of our world, is an important step for all future AI systems,” says Tim Brooks, a scientist at OpenAI.

But there’s a disclaimer. OpenAI gave Technology Review a preview of Sora (which means sky in Japanese) under conditions of strict secrecy. In an unusual move, the firm would only share information about Sora if it agreed to wait until after news of the model was made public to seek the opinions of outside experts. OpenAI has not yet released a technical report or demonstrated the model actually working. And it says it won’t be releasing Sora anytime soon. 

3.Google’s new version of Gemini can handle far bigger amounts of data

Google DeepMind has launched the next generation of its powerful artificial-intelligence model Gemini, which has an enhanced ability to work with large amounts of video, text, and images.

In one demonstration video shown by Google, the model was fed the 402-page transcript of the Apollo moon landing mission. Then they showed Gemini a hand-drawn sketch of a boot, and asked it to identify the moment in the transcript that the drawing represents. The model was also able to identify moments of humor. These sorts of AI capabilities are very impressive, Oren Etzioni, former technical director of the Allen Institute for Artificial Intelligence, told us. However, he did give one major caveat: “Never trust an AI demo.”

Check out this thread from Google’s Jeff Dean.

4.Japan and the U.K. both fell into recessions at the end of 2023, according to new data

Consumers in both countries reduced spending, leading to two quarters of economic contraction. Japan’s slowdown caused it to fall behind Germany — now the world’s third-largest economy — while the U.K.’s drop in GDP poses a threat to the reelection hopes of Prime Minister Rishi Sunak’s Conservative Party. The figures also showed the growing chasm between two of the world’s largest economies and the U.S., which grew by 3% last year despite fears of a recession.

5.Can Remote Work Help Diversity Recruitment?

In their latest study, Wharton’s David Hsu and Sonny Tambe found that when STEM job listings switched to remote during the pandemic, they drew significantly more female and minority applicants.

The professors outlined three reasons why they believe remote jobs draw significantly more numbers of diverse candidates:

1. Time Flexibility: This dimension is especially valuable for women who bear a greater share of child and family care. The professors cited one study that found female scientists with young children experienced a substantial decline in time devoted to research, for example. Remote work also erases commutes, giving women back more family time.

2. Location Flexibility: Remote work loosens geographic constraints for women who may be confined to a location because of their husband’s job. It also provides broader job opportunities for underrepresented minorities who may not have the same access to living in an expensive city. According to one study, just five cities — Boston, San Diego, San Francisco, Seattle, and San Jose — accounted for 90% of the growth in tech jobs from 2005 to 2017.

3. Limiting Face-to-face Interaction: Remote work allows women and minorities to remove themselves from hostile work environments or offices where they may encounter micro-aggressions or overt discrimination. However, the professors caution that this benefit also comes with a downside. Long-term remote employees may not develop the interpersonal skills required for managerial jobs, may get less useful feedback, and they may be overlooked for plum assignments and promotions.

“If you’re not coming into the workplace every day, your boss doesn’t see you, and that may limit you. You may be passed over more easily even if you’re quite capable,” Hsu said.

6.Running or yoga can help beat depression, research shows – even if exercise is the last thing you feel like

At least one in ten people have depression at some point in their lives, with some estimates closer to one in four. It’s one of the worst things for someone’s wellbeing – worse than debt, divorce or diabetes.

One in seven Australians take antidepressants. Psychologists are in high demand. Still, only half of people with depression in high-income countries get treatment.

New Research shows that exercise should be considered alongside therapy and antidepressants. It can be just as impactful in treating depression as therapy, but it matters what type of exercise you do and how you do it.

7.Japan is set to launch a digital nomad visa in March that will allow citizens of 49 countries (but not Indians) to stay in the nation for up to six months.

Japan serves as the best place to combine work and travel considering its metropolitan cities, diverse natural landscapes and world-renowned pop culture. In a move to boost the tourism industry and its economy and international competitiveness, the island country is increasingly opening up to foreigners.

8.Greater Numbers of Vietnamese are Working overseas

Vietnam has one of the best education systems in the world, and its highly skilled graduates are increasingly going abroad to find jobs. But rather than worrying about brain drain, the government appears to be embracing the trend: Last month, for example, German and Vietnamese officials signed a migrant labor cooperation agreement to help Berlin address the country’s growing worker shortage.

But the biggest market for Vietnamese labor is East Asia, writes Ho Chi Minh City-based journalist Michael Tatarski in his newsletter Vietnam Weekly. Over 518,000 Vietnamese people are working in Japan — accounting for 25% of all foreign labor in the country— and tens of thousands of Vietnamese have gone to work in Taiwan and South Korea. “These growing figures have a real economic impact here in Vietnam,” Tatarski writes, noting that remittances to Ho Chi Minh City increased 43% last year to $9.5 billion.