1.India opens doors for global EV makers; scheme to help Tesla

India has paved the way for the likes of Tesla Inc. to enter the country with its new EV policy. The Narendra Modi government has approved an electric-vehicle policy to promote India as a manufacturing destination for electric cars, according to a notification on Friday. 

Some of the key features of the proposed policy are:

(1)Original equipment manufacturers setting up EV plants in India to be allowed limited imports of cars at lower duty. 

(2)A customs duty of 15% would be applicable on vehicle worth $35,000 and above for a total period of five years

(3)⁠A minimum investment of Rs 4,150 crore is required, but there's no cap on maximum investment.

(4)OEMs have three years to set up a plant and start production of EVs.Domestic value addition to be reached within five years. 

(5)A localisation level of 25% by the third year and 50% by the fifth year will have to be achieved. 

(6)The duty foregone on the total number of EV allowed for import would be limited to the investment made or Rs 6,484 crore (equal to incentive under PLI scheme) whichever is lower. 

(6)A maximum of 40,000 EVs at the rate of not more than 8,000 per year would be permissible if the investment is of $800 million or more

Read more at: https://www.ndtvprofit.com/business/new-ev-policy-paves-way-for-tesla-entry

2.Hiding monetary exchange between capital & politics unhealthy for democracy; opines Andy Mukherjee of Bloomberg. Some excerpts:

By lifting the veil of secrecy from a now-banned election funding mechanism,India’s Supreme Court has shown that the rot in the country’s opaque political donations may be as wide as it is deep. 

The disclosure by the nation’s election commission — a day in advance of the judges’ Friday deadline — doesn’t provide all the answers, though it indeed throws up troubling questions about the exact nature of the relationship between capital and politics. And it does so just before nearly one billion voters in the world’s biggest democracy start choosing their next government.

The most generous political donor via the anonymous bearer instruments, known as electoral bonds, is not a globally known Indian billionaire, but Santiago Martin,a.k.a. “Lottery King Martin.” His Future Gaming and Hotel Services Private Ltd. has paid nearly 14 billion rupees ($165 million) since 2019. Another privately held group, Megha Engineering, is close — with donations of 12 billion rupees via two companies.

Among large conglomerates, troubled commodities czar Anil Agarwal’s Vedanta Ltd. has donated 4 billion rupees, the same as aluminum-to-telecom baron Kumar Mangalam Birla’s firms. A little-known supply-chain company in tycoon Mukesh Ambani’s stable has also contributed a similar amount. Sunil Mittal, whose Bharti Airtel Ltd. competes against Birla’s struggling Vodafone Idea Ltd., has given 2.5 billion rupees.

Forced to release the information by the Supreme Court, the SBI chose to dump the raw data via the election commission’s website as two separate PDF files of givers and takers. Putting it all into a spreadsheet leads to nearly 40,000 entries. As analysts and journalists have only just begun crunching the information, there will be much speculation in the days ahead about which businessman may have paid money to win a juicy contract, and who might have bought a bond to avoid going to jail.

Meanwhile, Reliance denies link to third largest donor Qwik Supply.

A spokesperson of Reliance made it clear that Qwik Supply Chain, which has its registered address at Navi Mumbai's Dhirubhai Ambani Knowledge City (DAKC), is not the oil-to-telecom conglomerate's subsidiary. In other development the Supreme Court asks SBI to disclose unique numbers of electoral bonds.

3.Honda and Nissan to join forces to survive electric vehicle race

Honda and Nissan will team up to develop electric cars, days after Volkswagen said it may collaborate with Renault, as traditional carmakers combine forces in the face of the threat from Chinese EVs.

Japan’s second- and third-largest carmakers putting aside their historic bitter rivalry comes as the established industry is bracing itself for the coming wave of high-tech, low-cost models from China.

“The rise of emerging players is becoming faster and stronger. Companies that cannot respond to the changes will be wiped out,” said Honda’s president Toshihiro Mibe. “We held our discussions from the viewpoint of whether we can continue to be a top runner or even survive in 2030.”

Carmakers from America to Europe to Asia are already facing rising costs from new technology development and tougher emissions rules, while also struggling to develop cheap electric vehicles that they can sell profitably.

Once a laggard in the auto world, China is using its lead in battery technology and knowledge of carmaking gleaned from international manufacturers to produce next-generation EVs, which have been designed for export to the world’s automotive heartlands.

Nevertheless, the companies said they were not considering a capital tie-up for now but did not rule out the possibility

4.Playing with dogs helps people concentrate and relax, brain recordings show

Plenty of research has investigated the bond between humans and dogs, demonstrating that canine companions can improve people’s moods, reduce blood pressure and lower levels of the stress hormone cortisol. Just looking dogs in the eye may even boost levels of oxytocin, a hormone associated with feelings of love and trust. 

But few past studies have pinpointed what happens in people’s brains when they interact with a furry friend.

A study published Wednesday did exactly that: Researchers in South Korea attached headsets of electrodes to 30 adults, then measured changes in their brainwaves as they interacted with a poodle named Aro. The results indicated that walking the dog made the participants feel more relaxed, brushing her improved concentration, and playing with her yielded both of these effects. 

5.Trapped in routine? Here’s how to “dishabituate” and rediscover joy

Habits can save you a ton of energy. They turn tasks that once required conscious, determined effort into nearly automatic processes. 

But things can steadily veer off course when you let your habits go unexamined, or when you put important relationships on autopilot mode. That’s why neuroscientist Tali Sharot suggests it might be wise to consider a two-step plan of “dishabituation,” which Jonny Thomson covers in this fascinating interview.

6.Common Age Differences, Married Couples

Through pop culture, it sometimes seems like it’s common for there to be a wide age difference between spouses. How common are the age gaps, really? These are the age differences through the lens of the 2022 five-year American Community Survey.

A third of male-female married households have spouses within a year of each other. When there is an age difference, the husband is usually the older one. Wider gaps of 10 years or more are less common but not unheard of.

DIFFERENCES BY AGE OF EACH SPOUSE

Circles represent the prevalence of married couples at the corresponding ages.

7.Grant Thornton US sells majority stake to private equity

The US arm of accounting firm Grant Thornton has agreed to sell a majority stake to the investment group New Mountain Capital, in the largest of a wave of private equity deals that are reshaping the sector.

The deal, which would be New Mountain’s second investment in a US accounting firm, was announced to Grant Thornton’s nearly 10,000 staff on Friday, according to people familiar with the matter.

It comes weeks after smaller rival Baker Tilly agreed a $1bn cash infusion from private equity group Hellman & Friedman to fund an acquisition spree, and is likely to further intensify competition in a sector that has been fast expanding beyond traditional tax and accounting into consulting services.

Chicago-based Grant Thornton is the seventh largest accounting firm in the US after the Big Four, RSM and BDO, with $2.4bn in revenue in its past financial year, which ran to July 2023.

8.Russia’s economy once again defies the doomsayers

In the two years following Vladimir Putin’s invasion of Ukraine, Russia’s economy has repeatedly defied the doomsayers. A financial collapse, widely predicted in the spring of 2022, never came to pass. The economy fell into recession, but it was less severe than expected and passed quickly. Inflation was the most recent scare. Last year prices accelerated rapidly; economists believed they could spiral out of control. Even Mr Putin was worried. In February he urged officials to give “special consideration” to rising prices.

Once again, however, the Russian economy seems to be proving the pessimists wrong. Data released on March 13th showed that prices rose by 0.7% month-on-month in February, down from 1.1% at the end of last year. The annual rate of inflation is stabilising at around 7.5% (see chart). Forecasters expect it to fall to just 4% before long; household expectations of future inflation have flattened. Russia’s presidential election was due to begin on March 15th, after we went to press. The result is a foregone conclusion. If it was competitive, these figures would do Mr Putin no harm.

Russian inflation surged last year owing to a fiscal splurge larger than the one implemented during the covid-19 pandemic. As Mr Putin doubled down on his invasion of Ukraine, he increased spending on everything from transportation equipment and weapons to soldiers’ salaries. Total government outlays rose by 8% in real terms. Demand for goods and services soared beyond the economy’s capacity to provide them, prompting sellers to raise their prices. Workers became particularly difficult to find, not least because hundreds of thousands were called up and tens of thousands fled the country. By October last year nominal wages were growing at an annual pace of 18%, up from 11% at the start of the year. This provoked price inflation in labour-intensive services such as health care and hospitality.

Who deserves credit for the turnaround? The finance ministry is advancing its claim. Last year its officials successfully lobbied for exchange-rate controls, which compel exporters to deposit foreign currency in the Russian financial system. The wheeze has probably supported the rouble, which has appreciated in recent months, reducing the price of imports.

Central-bank officials think that their peers in the finance ministry are economic know-nothings who mess with markets at their peril. They believe their policy—of more than doubling interest rates since July 2023—should take the credit for the inflation slowdown, and they are probably right. Higher rates have encouraged Russians to put money in savings accounts rather than spending it. Tighter monetary policy has also curbed lending. In December retail lending grew by 0.6% month on month, down from 2% for most of 2023.

Few other central banks have been quite as tough. Yet Russia still seems to be heading for a “soft landing”, in which inflation slows without crushing the economy. The performance of the economy is now in line with its pre-invasion trend; GDP grew in real terms by more than 3% last year (see chart). Unemployment remains at a record low and there is little evidence of corporate distress. Indeed, the rate of business closures recently fell to its lowest in eight years. Meanwhile, the Moscow Exchange is hoping to see more than 20 initial public offerings this year, up from nine last year. And the latest “real-time” data on economic activity are reasonably strong. Consensus forecasts for GDP growth this year of 1.7% therefore look too pessimistic.

Russia’s economic resilience is in part the consequence of past stimulus. In recent years corporations and households have built up large cash balances, allowing them to continue spending even in the face of high inflation, and avoid default in the face of high borrowing costs. As in other parts of the world, falling demand for labour has mostly resulted in a decline in unfilled vacancies rather than in a lower number of people in employment. Figures from HeadHunter, a recruitment site, suggest that the ratio of open positions to jobseekers has stopped rising. Having struggled to find workers in recent months, bosses are reluctant to let people go unless they absolutely must.

Sanctions-busting has also juiced the economy. Russian production facilities formerly owned by Westerners have reopened under new management, as the central bank points out in a recent report. At the start of the war, sanctions made it hard for Russian firms to source inputs, delaying production. Now, though, companies have set up durable supply chains with “friendly” countries. Well over half of goods imports come from China, twice the share from before the invasion.

As new trading relationships have bedded in, Russian exporters have dared to raise prices, supporting revenues and profits. The discount on oil Russia offers to Chinese customers, for instance, has fallen from more than 10% in early 2022 to about 5% today. And it is not just oil. Mr Putin boasts about soaring ice-cream exports to China, noting last week that he “treated my friend, President Xi Jinping”, to a lick.

As every Russian knows, inflation is never truly defeated. Central-bank officials continue to fret that inflation expectations remain too high. The biggest worry is that the rouble may depreciate, either because of lower oil prices, another round of serious sanctions or if China loses interest in supporting Mr Putin. These are serious concerns. Nevertheless, the pariah economy is once again back on track. ■