There's been a recent surge in American companies investing in India primarily through Reliance Jio (owned by Mukhesh Ambani who's got a good connect with the current ruling Government). It's been spiking since the Anti-China sentiment led Buy and Use 'Made in India' cries. Government has even asked eCom Flipkart and Amazon to display Country of Origin for each product.
With all these, This investment from Google seems another strategic move by an American company to say that we're truly concerned about Indian growth. So that their development centers here or products made for India don't get flagged as American.
> Mukhesh Ambani who's got a good connect with the current ruling Government
To be fair, Mukesh has got good connections everywhere. He is India's most powerful person.
Amitabh and the Shahrukh (some of the world's richest actors, both half billionaires) both volunteered as servers at his daughters wedding as a show of appreciation. If a man can command the most powerful of his country to such level of willful subservience, then every Govt. will try to curry favor with him.
I will add, that while his intentions might be entirely selfish, the pace at which Jio was able to bring affordable 4G to the whole country is incredibly empowering for rural / small town India.
That being said, adding money to the pool of what is quickly becoming a monopoly is not a "fund to digitize America" as Pichai put it.
> volunteered as servers at his daughters wedding as a show of appreciation.
> can command the most powerful of his country to such level of willful subservience
To me there's a disconnect between the two phrases. I don't think they were volunteering to humiliate themselves, but rather to show how close they were. Let's say hypothetically that Bill Gates had become really good pal with Jeff Bezos and that you went to an event that one of the two had organized and you saw the other serving the punch, would you say that he's being subservient?
> volunteered as servers at his daughters wedding ... subservience
I don't know about you, but when I hear "working as a server at a wedding attended by many powerful people", I don't think "subservience", I think "unique opportunity to make connections, and to potentially snoop insider information."
You must not know of Amitabh and the Shahrukh -- they're not some smalltime actors that need to get a leg up. This would be like Tom Cruise and Brad Pitt offering to be servers at Jeff Bezos' daughters wedding. It's absurdly subservient.
Do not ignore cultural differences. If you see such an activity as a job, then you would arrive at a conclusion like yours.
In India, it's common for hosts to serve food as a sign of respect to their guests. Close friends and family of hosts also join. This only showed the closeness of the relationships among Mukesh and other stars. Seeing it as a subservient act isn't accurate, no big star would sign up if it were so.
Subservient isn't the right word I think. A lot of rich and famous attended the Ambani wedding events – Clinton, Huffington etc and a lot of celebrities from world over.
Beyonce did a show too. So did a lot of Bollywood celebrities. These celebrities do paid gigs at these ultra rich wedding parties.
Not really, people whose status is beyond question can do stuff like this just because they feel like it. I attended a high school play at a fancy private school in Texas and to my surprise the parking lot attendant was Michael Dell, who had a kid in the school. Nobody said “yuk yuk Dell is such a loser he worked the parking lot.”
Random language usage question: in India, if someone is referred to as a billionaire, would that be in terms of rupees or dollars? (1 billion INR is ~13.3 million USD)
Or does it essentially never come up because a typical Indian would use lakh/crore instead? Is there's something like a "lakh croreaire"?
Indians use "crorepati" for someone with a crore rupees. Interestingly, the Indian equivalent of Who Wants to Be a Millionaire" is "Kaun Banega Crorepati" (who will become a crorepati).
As for millionaire/billionaire, imo it's hard to tell but on HN I would infer USD. (Amitabh Bachchan's net worth is ~$400M based on a quick search.)
> the Indian equivalent of Who Wants to Be a Millionaire" is "Kaun Banega Crorepati"
The North Indian equivalent is called so. Atleast, In TN we have our own version of the show, based on the same "Crore" denomination but not thus called.
What is this fetish by some people to always label things "North Indian"? It is a national show on a national television where the participants are from all around India (from Ladakh to Tamil Nadu, Gujarat to Arunachal Pradesh).
If you see a billion being used it is usually the Western style. So when you say someone is a billionaire it is in USD. If you want an Indian take on it, it would be: Lakhpati and Crorepati.
I'm not familiar with Mukhesh Ambani or his reputation, but sounds like he's India's version of China's Jack Ma? Jack Ma and Alibaba came to the forefront due in part to his connections to the Chinese government.
On the topic itself, it's unclear what Google's intentions are and how they could benefit from such an investment. $10B is not a big sum so is the purpose altruistic or as grease for other purposes?
More like the Koch brothers. Inherited a vast company with tremendous financial and political resources and made them even vaster and more deeply rooted.
I wouldn't call Mukhesh Ambani as Jack Ma. He inherited a lot of wealth and more important, a lot of government connections. He can bend rules for e.g. his non-existent Jio University got the tag "Institution of Eminence"
He gets foreign technology and just jumps in any sector with governments blessing. Be it oil and gas, infra projects or even telecom
Companies aren't altruistic, their only purpose is to provide value to shareholders. That doesn't mean this is a greasing, it could just be google wanting more people connected to the internet so more people use their products.
> Companies aren't altruistic, their only purpose is to provide value to shareholders.
Companies do whatever their owners tell them to do. What you are talking about one specific model of what some people think they should do and what purpose they should serve in society. A very popular and possibly even 'default' model, but only one of many.
I don't see how it's not alarming for Indians that one key person/company connected to the govt is the sole beneficiary of incoming businesses into India.
There is a cause for alarm, and some Indians do see that as a threat. Right now, Indian society is caught in a deep web of fake news, false narratives, and the conflating of what the govt is, what the nation is, and the difference between the two. Many competitors have raised a lot of questions about how Jio did not follow the rules (there are a lot to link) the basic one being a rule about giving free plans for more than three months (which was not allowed by TRAI - Indian telecom regulatory authority - previously). but nothing happened, and people were happy with free internet. A lot of these issues are buried under loads of information on the many 24 hour news channels (two of them owned by Mukesh Ambani himself) and then the web of Whatsapp and other online social media helping to shape a narrative.
Then there is an average indian feeling pride about how Jio is able to attract such investments. So, some of us may have considered it, and would have spoken about it, but a lot are not really aware. When people do speak against these, they are usually tagged as cynical or contrarian because speaking against a public figure in India is sometimes considered speaking against India.
P.S. Sorry for being so vague, but this requires a lot of context to ascertain why it is this way. I dont blame whatsapp or Facebook, just that we are a vulnerable bunch and usually believe what we want to believe.
Most Indians care only about the cheapest workable plan, product, service, while making a purchase. It's not about Jio, it's about the 500 rupees free call, free SMS, free 4G plans. As long as Jio offers it they'll use it. They'll drop it as soon as something cheaper comes around.
Mukesh Amabani, is mostly raising money because he had simply too much debt, and he is also getting old. It could also be a part of larger succession planning. His kids are not that much hands-on into business as much as he was with his father. It makes sense to have a Tata Sons Trust like scenario where professional managers runs the companies while the companies are owned through a holding trust owned by his children.
The experiment with Anil Ambani's mismanagement and the state he has left his business is a lesson for Mukesh to not let it repeat with his own children.
> They'll drop it as soon as something cheaper comes around.
My bet - nothing cheaper comes along. Because Reliance's biggest competitive advantage is close links with the government, regardless of the party in power. A hypothetical competitor would find it difficult to get spectrum allocated, have trouble with land usage rights, tax issues like Vodafone had.
There is a reason foreign companies set up joint ventures with Reliance, Tata, Birla etc. Ostensibly it's because these companies "understand" the Indian market. In reality, it's because they have spent decades "lobbying" political parties and will continue doing so for several decades more. A company like Sky wouldn't know how to get started with political lobbying, wouldn't be comfortable with outright bribery, can't make a long term commitment to staying in India. So they set up Tata Sky - they supply the tech, Tata supplies the connections.
Well Indian customer is always a price conscious one though. Like it or not, we are that way. Remember those days people used to make pre agreed arrangements, and just make the communication acknowledgements though missed calls?
So eventually if you want to be profitable and sell more services, you have to offer a good price.
It's just the way it is. I even know people who look at fares and then decide if they want to take their own two wheeler or an Ola. Online food delivery works the same way. People hunt for deals and only order through that.
Sure some people pay for services. But those are generally rare.
A classic example from a business perspective: Poorer users had no money to waste calling people up - but incoming calls were free.
So firms would advertize a missed call number on the radio.
People could give that number a missed call, and they would soon get a call back from the firm - thus never spending any money at all.
The more common interpersonal example was one person having more money than the other, or being on a company plan - so they would get missed calls from their family/friends, and they would then call back.
The cost was thus borne by the firm/richer person/person with more talk time.
Say you want to tell your mom once you safely reach school (via public transport). But you don't actually want to spend the money on a call or text (India did not have "unlimited text", at least when I was growing up there). So your mom and you agree on a protocol that "one missed call means I reached safely". Now you just call her and disconnect immediately. Message received.
Hypothetical Example: I would tell my dad that I'll give a missed call and let it ring just thrice once I got safely to University from home.
Actual Example from my life: My dad had a cellular plan that had lots of free minutes of calling. So, I would just give him a missed call and he would call back. This was the early 2000s I think.
You would tell me "if I am able to make it to the movie tonight I will leave you a missed call around 2pm" and then neither party pays for a telephone call or sms.
In those 'competive' days data prices were so high that most of the country couldn't afford it. And this was just because the existing companies had formed some sort of a 'cartel' and were not willing to part with profits[0]. All that changed when Jio entered the market.
Those are not the competitive days, those are pretty much classic examples of the chilling effect on our market after the SC forcing a re-auction.
An auction exposes market pricing information which was hidden before.
In case people aren't aware, the Indian mobile sector was one of the cheapest and most pioneering markets of its time.
People created the 0 cost phone call - farmers and mobile users could give a missed call to a number they heard on the radio, and then they would get a call back.
Stuff that was in sharp contrast to the mobile plans and service packs around the world.
While people argue about data, they forget how hard it is to set up the infrastructure and the massive boost forward simple phone calls were for people.
That was the era I am talking about, not post the SC verdict.
> In case people aren't aware, the Indian mobile sector was one of the cheapest and most pioneering markets of its time.
Not sure in what way you mean pioneering but it was definitely not the cheapest! Everything cost money. Text messages, phone calls, data, roaming between states, out-of-state phone calls. Everything. All this in addition to the cost of the cell phone itself - no bundled offers with phone like AT&T did with Apple in the US.
Furthermore, you could get away with a connection from private companies like Airtel and Vodafone if you lived in a big city. Rural coverage by these players was notoriously bad. The only substitute available was the one provided by the government itself - BSNL - which got a reputation of having the "best coverage".
All that changed dramatically when Reliance came up with a Rs.500 phone which included a connection with free unlimited calls between two Reliance phones. That was the beginning of true mass adoption of cell phones in India.
> People created the 0 cost phone call - farmers and mobile users could give a missed call to a number they heard on the radio, and then they would get a call back.
This is not an example of a model working well. This is an example of a workaround to mitigate high call costs.
You can check what ARPU and per individual costs were in the world comapred to India historically for calls. India has always been one of the cheapest places to have calls, and one of the lowest ARPU in any market - and it managed to get multiple mobile phones per person and has a thriving telecom market.
The 0 cost phone call is an example of the market working well - people at the bottom of the pyramid have no money to spend, and given what ARPU was, expecting even lower prices is the stuff of fantasies.
This is innovation at work. I don't know what people are expecting when what they had was already impressive for the time.
True, yet recently I recall prices being raised and all firms moving in lock step. A classic signs of oligopolistic behavior.
Further all 3 major firms are in massive debt, and after the SC interpretation of how they have to pay their dues, they are pretty much dead firms unless they get money.
You can already see them creating new packages to target users who have more disposable income.
I'd say make hay while the sun shines. The structure of a market dictates the strategies and tactics which work. With 3 players collusion is the norm, not competition.
I don't think Jio's game is to squeeze out revenue from the cheap data users. They've openly admitted to using Deep-packet Inspection techniques and I believe data harvesting is where the main long-term game looks to be for them.
If you're concerned about your privacy, it's usually known in India in the tech circles to stay away from Jio related products.
What can any packet inspection do over https, since that's where the majority of the important traffic is,not to mention that a lot of apps use certificate pinning, so even MITM can't help analyse the packets. And all this is before eSNI becomes mainstream.
It has been about 3 years atleast since Jio has paid plans, and things are still way way cheaper. Even if the prices double, they will be way cheaper than what they were.
Firms will just keep removing plans that help the poorest users as they work to get ARPU higher. This has to happen anyway because the major firms are under huge mountains of debt.
They cant be allowed to fall, because then the only name in town is reliance, which would be even worse.
What people are forgetting is that 1) Firms already raised prices and 2) that its not about data.
Its about a competitive market. We used to have this, and it even created the thriving VAS industry for a while. That died because of classic rent seeking behavior by telecoms over the VAS firms, killing that entire engine of ingenuity.
Telecom industries are know for bad results (see America, or Australia) when its not structured correctly.
Everyone who is focusing just on prices is unaware of the number of failures and missed opportunities resulting from bad telecom market structures.
Take Net neutrality, given the telcos way, it would have long been lost and rent seeking structures would have grown on top of it - it would recreate the bundled world of cable television over the net.
This means that poor users would never get a chance to look at products which compete purely on features and value - they would look at products that are "Jio Free" or "Vodafone plus", where having a hook up with the ISP is more important than features.
Looking at it in terms of "hey prices are low" is missing the great risk this industry is in.
My personal take is that for Jio the cellphone network is an opening to providing services that can be monetised in long run. Same strategy thats being followed by biggest tech companies across the world.
That will not work that well. Average Indian right now doesn't really have that much disposable income for such services to be very profitable. It will have to be the very long run. I doubt either google or Facebook earn a lot from India right now, and they are very well established, and their compute costs are as low as they can get. I don't see how Jio is going to be able to follow the strategy of the biggest tech companies.
I hope India does grow at a large enough rate for such services to be profitable.
Most telecoms in the world are,In Canada Bell Canada,Telus and Rogers own almost 90% of the market. When Verizon tried to enter the market the big three lobbied so hard against Verizon, even Verizon with all its capitol could not get in to Canadian.In the end customers in Canada are still paying very high fees for data plans anywhere in the world. Eventually India will get there.
If the children don't even want to bother contributing to the enterprise, why not give ownership to the larger public, via a stock sale + charitable donation (like Gates and Buffet do), ?
> Many competitors have raised a lot of questions about how Jio did not follow the rules (there are a lot to link) the basic one being a rule about giving free plans for more than three months (which was not allowed by TRAI - Indian telecom regulatory authority - previously). but nothing happened, and people were happy with free internet.
These competitors are the same companies who had 'cartelized' the telecom industry[0] and had refused to bring down data prices in order to ensure their profits. I wonder why questions weren't raised against TRAI back then. Once Jio entered the scene, they did bring down the prices.
A few passing birdies told me that Sundarajan was far more enthusiastic about China, then India, and that he had quite some amount of aversion to his home market.
the person is connected with both the parties. so may be opposition does not dare to mention him. but i personally feel he is lesser evil, especially if you look at the penetration Chinese products and venture money have made in India.
Chinese venture firms are subject to PRC's National Intelligence Law, which requires all Chinese organisations to support, co-operate with and collaborate in national intelligence work.
Their influence in India is directly proportional to the money they put in the Indian economy, which basically means the influence exercised by the Chinese government. The lesser the Chinese influence, the better it is considering the current state of India-China relations. Ambani's money is definitely not fueling a known Indian adversary.
You have a fair point regarding not fueling a known adversary. I'm not sure about the influence part, as they have very far from a controlling share in the Indian investments I'm aware of. There is HDFC Bank, but their the Chinese share doesn't exceed 2%. Dubai I think has a larger share than the Chinese.
It's not China, it is Chinese VC money. And no, I don't see that the Government can deal with Ambani so easily, or even antagonise him with impunity. Winning elections cost money and with the new electoral bonds, Ambani can easily fund the opposition in the next elections.
Yeah, the Chinese government is far more involved with it's companies than India with any of it's non nationalized companies. China got Jack Ma to spinoff Alipay from Alibaba, screwing the other shareholders badly. I don't think there is anyy big company in China without CCP members high up in the ranks.
Ambani on the other hand, however powerful he may be, is certainly not a bigger threat than China. Companies being Ambani owned, while worse than a competitive market, is still much better than being Tencent owned.
Much more easier to control than China. Ambani doesn't have an "Ambani liberation army" backing him up.
Think of it this way, why did China spin off Ant Financial out of Alibaba? Had it been in hands of foreign investors, it would be a huge issue later on if it became big. And if it became big, it would be much harder to spin it off that way. You can't spin off 100 billions and not expect strong retaliation from the countries of the foreign investors.
It was much more easier for them to control Jack Ma, and ensure he never becomes too powerful.
While India is a democracy unlike China, and the government can't just get people to disappear with nobody questioning, even without such totalitarian tools, a well functioning sovereign government is always more powerful than any of it's richest people.
OK, thanks for explaining your point. I still think you're conflating Tencent with China as much as you're overestimating how well-functioning the Indian government is. In my view it is grossly incompetent beyond spreading propaganda, horse-trading MPs and MLAs to swing elections, and indeed disappearing people and killing them extra-judiciously in fake encounters. Ambani capturing everything would result in the complete demise of the dregs of Indian democracy as he will remain king-maker as long as he lives IMHO.
I think you are trying to argue both sides here. If the government is not afraid of doing shady stuff, like the Chinese government, then it is free to do anything to any billionaire, and being rich doesn't get anyone any power, like China.
If the government respects the rule of law, and doesn't do any extra judicial stuff, even then it makes sense to not let a competing foreign power like China be a stakeholder in your important companies.
If the Indian government is not afraid of contravening Indian laws, it can grab Chinese shares anyway.
If it wants to maintain the appearance of being lawful and fair, there is already an Enemy Property Act, 1968 to more or less support grabbing Chinese investments (perhaps with an amendment or two). Under what pretence would they grab Ambani's property? There is Eminent Domain in India, but only AFAIK for land ownership, and even that requires fair compensation at market prices.
It can't grab the Chinese shares without angering China, and anyone in the whole wide world would rather anger any billionaire than China.
> Under what pretence would they grab Ambani's property?
If there is no existing law, government can make laws. I mean the government did nationalize so many banks at once right? The government is sovereign. The amount of power it holds over it's own people, even the richest ones, is far far higher than what it holds over another strong sovereign state.
Anyways this was all about power. There are so many other reasons for ensuring someone in the country holds the wealth rather than your competitor.
> there is already an Enemy Property Act, 1968 to more or less support grabbing Chinese investments
No. The Enemy Property Act, 1968 is specifically made for Pakistani Nationals after the 1965 Indo-Pak War. It is not generic. To declare China as an Enemy a proper War should take place between India and China. Is China ready for such a misadventure?
Who was the us in that scenario? There was no India back then, just a set of kingdoms and 'princely states' that hated each other as much as they opposed any European takeover. The present circumstances are in no way similar.
Ambani is not going to claim Ladakh is his or want to build a house in entire Arunachal Pradesh. China on the other hand.... is already doing that. And we don't want that.(period) literally. Ambani can be dealt with. But not an aggressive neighbour who have control over devices and cameras with 50% of Indian youths.
The point here is not the historical name of the subcontinent or any shared cultural history (which all neighbouring states have). It is the lack of a common Indian government, comparable to the present time, that made the mistake of allowing too much investment by the EIC as you seemed to suggest. What the British Empire called India included parts of Afghanistan and Myanmar; modern India certainly has no claim over them.
I think you misunderstood the parent poster's point. They are talking about India the nation, while you are talking of India the concept. India the concept existed. But India the concept is similar to America the concept or Europe or Africa the concept, not Germany or France. Also, before the British, the last empire to rule over almost all of modern day India was Ashoka, more than 2000 years ago.
Umm, the Mughal, the Guptas? Also the pratiharas, rashtrakutas and palas collectively ruled over india too. The Delhi sultanate was pretty huge too, and so was the maratha empire.
But being a single governance group isn't the point. Being culturally similar is what defines India. And it obviously is.
Tencent (and all Chinese companies) are controlled by the Communist Party. The business has autonomy only on questions that the Party has no preference about. It's about the same as a profesional employee working for a business.
I think GP meant that at least very with Ambani, the money stays in India and is circulated inside the country. The services are provided to Indians, we are paid to do the work, and we spend it in India. It's better because the wealth of the country isn't leaking away, or at least leaking slower.
Services provided, persons employed, employees paid etc is all the same whether Ambani owns the shares or Chinese VCs do. Ambani would no more share his profits with other Indians than Chinese VCs would. Both would be subject to the same taxes on income earned in India. Maybe Ambani reinvests some of his profits in India; but for all we know he might choose to do so outside India.
China, an authoritarian state can and does use its financial influence to force it's interests. Do you not see how Chinese vc answer to china and not india? If you think they can just be banned, what else do you think is the Indian government doing?
Ambani is still subject to Indian laws, and even if he leaves, his wealth and empire is answerable to the Indian government.
The companies that Chinese VCs have invested in, in India, are also subject to Indian laws. No I don't think the Indian government can grab Chinese shares in Indian companies. That is why I'm asking what the problem is if the Chinese invest in Indian companies. To me it seems better that investments are spread between Ambani, the Chinese and all the rest rather than letting Ambani own everything.
No difference in China. Do what is good for the fatherland or your fiances, you personally and your family will suffer.
>>I don't see that the Government can deal with Ambani so easily, or even antagonise him with impunity.
So like many he's wayyy to powerful to deal with. But at least he is a local, not jeopardizing India's geopolitics. Just as he can control politicians, they can control him, if/when they want to. They know what he did to become so powerful and can send 500 police officers to his offices to search for evidence if/when...
I think there's a qualitative difference in somebody merely very rich and a person like Ambani who is in the top 10 wealthiest people in the world. He is not quite a 'local' that the Government can just CBI-raid into intimidation like e.g. Prannoy Roy.
See Russia as to how to deal with people like that. It is nothing that a raid or accident can’t fix. He is also not murdering Indian soldiers on the border which is a bonus. Same men that ordered that escalation are investing PRC money. If they are not same they share the same boss.
> Same men that ordered that escalation are investing PRC money. If they are not same they share the same boss.
This is speculation, unless you have sources in which case please share them.
The most detailed and seemingly authentic source [1] I have seen about the Galwan brawl (that resulted in the deaths of 20 Indian soldiers and an undisclosed number of Chinese soldiers) suggests the escalation was not planned but the accidental result of a chain of events starting from a freshly deployed Chinese trooper pushing the Indian party's Commanding Officer.
1. Bring new troops trained in different area(much easier to bash someone head in with a club when you were not stationed right across from him)
2. Instantly escalate by attacking enemy officer(clearly planned event)
3. Have melee weapons prepared and ready to go(clearly planned)
Indian officer and men acquitted themselves well I have to say reacting against completely unforeseen attack with their own initiative and aggression. Shutting down this play and counter attacking.
Can't reply to you last comment but here is my take
I was born in totalitarian regime so my point of view on how things work is different. Nobody in the right mind in regime like PRC will show initiative like shoving you enemies Commanding officer. It just never happens. Those guys were ordered to do it. Consequences of doing something like that to you, your family etc without an order would be extreme.
Number of killed in the end is irrelevant, it is like US counting how many vietcong they bagged, utterly pointless. Small units, ncos and officers performed very well here.
I think it was what you call reconnaissance in force. Chinese wanted to see the quality of the opposing units, cause confusion and perhaps fear. They succeeded in first, others not so much. But they are persistent and judging from satellite photos have been building up force in the are for a while. Act 2 will come, sooner or later.
It is very consistent with the "fishermen" ramming opponents ships, killing Vietnamese sailors etc. This has been MO of the PRC for a very long time.
As for the rest, I disagree with your interpretation. It can even be argued that the Indians responded disproportionately to one guy being shoved by attacking everyone in the opposing party. Anyway we can't claim both that the Chinese murdered our troops and also that we killed more than twice of theirs than they did ours (but apparently, when we kill them, it is honourable?)
Are you really interested in debating the topic, or just perpetual muddying the waters?
The question is if Chinese ownership of Indian industries will be bad, and the answer is an obvious yes.
As for your claim in this case, it wasn't just a freshly deployed Chinese trooper, but the whole platoon, who had built structures and arranged weapons in violation of prior agreement.
Well there are a lot of people who are not aware of the fact and then there are those who are onboard because they are onboard with the government. So the alarmist kind are a minority which media doesn't show. Also 90% of the media channels are owned by the aforementioned person.
Why does speaking up about the Indian government inevitably bring up questions like this? Ambani's relationship with this government bothers me a lot (among many other things about any government, particularly this one).
Sorry, I cannot exhaustively list all possible issues with the country's politicians everytime I have something to say about the current government that is supposed to be accountable to Indians (because they are in power, Sonia Gandhi is not!).
Again, I've seen this pattern: Question this government and immediately be branded as a Congress/AAP/$party sympathizer. At best people ask questions like yours, and at worst they come to an agreement that you should immediately leave India and go to Pakistan. This for questioning your government.
It's wrong to characterize it as "one person being the sole beneficiary of incoming businesses in India"
The recent spate of investments in Reliance JIO, have been just stake purchases. He is selling stake in his company to get capital for expansion.
Ambani has signaled that he wants investment to further grow an already rapidly growing empire of media services.
A few things are very favorable to Jio
a) Due to COVID and the expectation that this pandemic and its ripple effects will be felt for a few years, there is a very high likely hood that new customers will start consuming digital media services. And that is the key. Investments in JIO reflect the fact that it is the only company that has all it's cards right to capture the new user market.
b) Also, JIO has been at the cusp of an already rapidly increasing user base, that includes a large portion of rural people. It has seen a massive growth in user base and actual users too (No one is simply taking a phone connection and keeping it. They are actually using their JIO connections to consume content)
c) And the pandemic has come at just the right time too. Old guard companies are caught on backfoot. There is tremendous good will in people for JIO. JIO reduced costs 30X for data. It was a game changer. Peoples media consumption in India exploded.
d) In addition to this, Reliance group also has its hands in the Media and Entertainment industry. Not to mention retail, FMCG, etc.
So, as on date, JIO has the following services fully available to a large and every increasing base of users, this is apart from dead cheap 4G internet connectivity on phones and dongles.
1) Movies
2) TV Channels
3) Retail Shopping, they recently launched a competitor to Amazon.
4) Games
5) Educational content.
and a myriad more.
But here comes the best part. There are a couple of reasons India tailor made for services.
1. It has a large pre-teen, teen and young adult population, that will dominate consumer markets for at-least 5 decades.
2. It has 28 states, 122 major languages, and similar set of cultural groups. So you have ample amount of scope to localize content and have a good audience for that content.
3. Indians love to indulge in languages and cultures from other parts of India. Punjabi songs are loved all over the country. Telugu cinemas have huge markets in southern states. Tamil movies are revered all over the country. And Indians consume a lot of dubbed content. Including international ones, like Korean etc. So what this means is that media produced for one local culture / language, if received well, has a ready market all over India. This reduces risk and increases rewards.
4. Indians love to consume content. We are a noisy civilization. We consume a lot of content and want new content all the time. Movies are a huge part of the daily lives of rural villages.
5. Large number of people in rural areas have been using smartphones for the past 5 years, thanks to reducing handset costs and usage costs. They are already consuming content on the internet via Youtube, etc. They are a ready market to push content and services too.
I suspect JIO is looking for large investments to create new content for its media services and setup a distribution network for it's retail services.
Additionally, Reliance is highly respected in India. When the current CEOs father ran the company, millions of middle-class families in India bought houses, cars, got their children married, gathered retirement funds, etc riding on the sheer growth of Reliance as a company.
> Additionally, Reliance is highly respected in India. When the current CEOs father ran the company, millions of middle-class families in India bought houses, cars, got their children married, gathered retirement funds, etc riding on the sheer growth of Reliance as a company.
Reliance is one of the companies that actually care about retail investors, at times even going to extreme measures to help them. For instance, in 1982 they took on the notorious bear cartel and even beat them:
The bear cartel was successful in bringing the share price down but Dhirubhai was smart. He realized that if this bear cartel was allowed to go on, they would have taken the share price down to wherever they wanted, and you know who would have lost? Ambani wouldn’t have lost, it’s the small investor that would have lost money and they would have lost faith in Reliance. So he said, you can’t hammer my shares
May I know exactly what sort of connections are we talking about it? Big business families have always had some relationship with politicians in India but they were less evident 2-3 decades back then due to then governments' incline towards socialism.
India's potential is limited only by the incompetence of Indian government (irrespective of who is in power). Too many shady powers being involved here pulling the string. India's data localization law was in fact lobbied for by the real estate firms as they wanted foreign companies to be arm twisted into investing in real estate in India. You can search news for who benefits from this sort of wasteful expenditure.
Given its huge population which is a growing market, it does make sense putting data centers closer home.
Cheap power and cooling might be a factor, but India is also building huge solar and wind capacities, and not to forget the solar alliance and cross border solar energy exchange/grid.
corruption is caused by wealth, health, educational inequality, lack of familiy planning in many cases. If people can't feed themselves or their families they will turn to corruption and use any means to get ahead
To say Mr Ambani has good relations with the current government is underselling his influence. He has good relationships across the spectrum of Indian political parties (except maybe the communists who are effectively irrelevant).
However you feel about how Jio got its foothold in the telecoms game ([1] has details), it’s sheer scale makes it an attractive investment. It’s one of two major national 4G networks and an astonishing amount of data moves through it. They’ve big ambitions on the 5G front. They’re also building India’s largest last-mile fibre network. Given that Ambani wants Jio to be debt-free by next year, and an upcoming IPO for Jio by 2024, key industry players falling over themselves to grab a pre-IPO piece isn’t surprising.
The concern, of course, is the complete lack of privacy legislation in India, and how this impacts Jio’s ambitions re “monetising” its users and their clickstream activity.
On the topic of country of origin, they list the country of origin on all produce I've purchased here in the UK. It blows my mind that it is profitable to ship grapes to the UK from South Africa.
I think this rather shows the continued weakness of India.
On one hand, China and nationalism are used as a tool by the Indian government (not least while the Covid-19 situation goes pear-shaped), on the other hand they are at least as dependent on US companies, if not more.
I think India should rather reflect on China's industrial strategy, including investments in infrastructure and fostering the development of national giants when India is lacking on both fronts.
> I think India should rather reflect on China's industrial strategy, including investments in infrastructure and fostering the development of national giants when India is lacking on both fronts.
I think it's much easier to make massive investments in infrastructure when you have a current account surplus. The Indian government is trying to push the industry to be more export focused but years of protectionism and import-substitution norms have made the industry less competitive.
More broadly maybe one should think of the China model as state-led capitalism and note that it did not origin in China but in Japan and succesfully carried countries such as Taiwan, South Korea, Singapore out of their development country status.
It is not the same as nationalism and in particular for India, strong nationalism has the flip-side of igniting dormant conflicts with it sizeable muslim minority.
With all these, This investment from Google seems another strategic move by an American company to say that we're truly concerned about Indian growth. So that their development centers here or products made for India don't get flagged as American.
Reference - Foxconn, Intel, Qualcomm, Facebook
https://economictimes.indiatimes.com/tech/hardware/apple-sup...
https://techcrunch.com/2020/07/12/qualcomm-to-invest-97-mill...
https://www.cnet.com/news/after-facebook-intel-invests-into-...