Wednesday, December 05, 2012

TiECON 2012 - Angel Fund panel

TiECON 2012 organized by TiE Chennai yesterday had an excellent panel discussion on Angel Funds.

Gopal Srinivasan of TVS Capital Funds moderated the discussion. The panelists were: Paul Singh of 500 Startups, Rajesh Sawhney of GSF Accelerator & Superangels, Rehan Yar Khan of Indian Angel Network, Karthik Reddy of Blume Ventures and Suresh Kalpathi of Chennai Angels.

Of the above, Rehan Yar Khan and Suresh Kalpathi represent Angel investors: wealthy people who invest their own money in small start ups, and help the companies go to the next stage. Paul Singh and Rajesh Sawhney represent accelerators - where they identify small companies who can be put together and fast tracked to next stage. Blume has raised money from nearly 100 HNIs, so it acts as a Venture Fund but Karthik claims they work like Angel investors.

Karthik provided an excellent insight into the kind of companies they invest: A company which will reach revenues of 2-5 crore INR within 2 years (so that they can attract investments in the next round from VCs) and can hit breakeven by this time so that they are not worried about any delays in the next round of investments. Even if there is no one interested in investing in such companies, Blume can itself put in more money in such companies.

Paul Singh said they typically invest 50,000 USD in their companies, hoping that it will last them for 6-7 months and look for next level investments. He said putting the start-ups together makes them perform better - peer pressure driving them to deliver more.

When queried on valuations, Paul said one could consider a ball park of not more than 15% of the company for cash to last for an year. Rajesh said he will not invest in a start-up company where the founders have given away more than 30% before the Angel round (to friends and family). Because there will be more dilutions in the subsequent rounds which will leave very little for the founders in the end. he said he has helped fix this issue for couple of start-ups but where it is not possible, he will not invest in them, even though the people are good and the idea is good.


There was a session on 'கஷ்டமான கஸ்டமர்' (Difficult Customer) in Tamil. S.Ve.Shekhar moderated the session. Karunanidhi of SKP Engineering College, Jayakannan of Arasan Match Industries and Muruganantham (low-cost sanitary napkins) of Jayashree Industries participated. It was quite an enjoyable session too, with a lot of witty repartee from Shekhar. This sessions could have been longer - it appeared to me that the whole thing came to a stop rather quickly. It is nice to see TiE organizing a Tamil session too.

It was at the end of this session that our new book was launched - a book written by IIT-M Prof A. Thillai Rajan (in Tamil): A guide to first generation entrepreneurs. This book will be available for purchase in another 3 weeks.

Tuesday, December 04, 2012

Crumbling democracy in Sri Lanka

Indian news media seems to be least bit concerned about the situation emerging in Sri Lanka. The Tamil Nadu newspapers (both Tamil and English) were primarily concerned about the civil war in which LTTE was destroyed by the Sri Lankan military. Since then, the coverage, if any, is only about whether Sri Lankan state will be held responsible for the human rights violations during and in the run up to the war.

Currently, the Rajapakse clan who have enormous control over every aspect of Sri Lankan administration is in the process of impeaching the Chief Justice of Sri Lanka Supreme Court. I have not seen any news coverage of this in the Tamil Nadu media.

The Supreme Court of Sri Lanka has hardly been the upholder of democratic rights and human rights of the Sri Lankans. The Cage, by Gordon Weiss documents how the courts have systematically sided with the ruling dispensation to terrorise and bulldoze the opponents into submission. Yet, whenever bodies such as UN and International human rights organizations have complained about the dwindling civil rights in the country, the ministers and secretaries of the government will jump up and say that the Sri Lankan justice system is exemplary and will provide justice for all better than any foreign body would.

The current attempts of impeachment shows that Rajapakse & co will not brook any form of non-compliance from other "pillars" of their democracy. Just as Rajapakse group dispensed with the army commander Sarath Fonseka and put him in jail on trumped up charges, now it is the turn of Chief Justice Shirani Bandaranayake.

Indian news media focused on the power struggle in Pakistan between then dictator Gen. Pervez Musharraf and the Supreme Court of Pakistan. However, there is not much interest in a similar struggle happening in Sri Lanka.

Sri Lanka will soon be a right wing dictatorship under Mahinda Rajapakse, where dissent in any form will not be allowed. The opposition UNP under Ranil Wickremasinghe is powerless. Sarath Fonseka has been emasculated. The army is controlled by the defense secretary Gotabaya Rajapakse, a younger brother of Mahinda, while the Parliament is controlled by the speaker Chamal Rajapakse, an elder brother of Mahinda. If you have a pliant Chief Justice, then even the bits and pieces legal opposition can be taken care of.

Monday, December 03, 2012

Caste clashes in Tamil Nadu

It is very disturbing to see the emerging caste conflict in Tamil Nadu. The MBC castes in particular are coming together as a bloc against... not the upper castes but the dalits!

PMK's Ramadoss has organized a meeting last week in which other MBC castes have come together, possibly to create a united political front. But the key agenda is to keep the dalits from marrying their womenfolk! Look at the language here:
“They wear jeans, T-shirts and fancy sunglasses to lure girls from other communities,” [Ramadoss] told reporters. A resolution adopted at the meeting cited statistics of broken marriages to claim that inter-caste marriages ended in failure because they were unions born out of caste design and not love.
Dalits are portrayed as 'girl-snatchers'.  This is very similar to the Hindutva organizations accusing the Muslims of love-jihad. Ramadoss claims that dalits are waging a jihad against 'their girls'.

The agenda is two-fold:
  1. Stop inter-caste marriage, in particular if the boy is from the dalit community.
  2. Weaken the SC/ST (Prevention of Atrocities) Act.
The second demand is more sinister. SC/ST Act itself is very rarely applied and it has not prevented any atrocities against the dalits. Now, the MBC castes want the act to be weakened (read: removed) so that they can roll out their gameplan without any worries.

The response to this is very muted from the mainstream political parties. No official statement from DMK, AIADMK, Congress and BJP. Only Thirumavalavan of VCK is trying to organize a political front asking for support from the communists and Periyar groups (a bunch of fringe political entities opposed to caste, amongst other things). Such a political front will not have the strength to withstand the fury about to be unleashed by Ramadoss and his cohorts.

I don't think a few dalit boys marrying a few vanniar girls is the real issue here. The anger and hatred against the dalits seem to be very real. The speed with which nearly 40 MBC/BC castes have come together on an anti-dalit platform shows that they are very serious. There are regular statements from other caste groups as well against the dalits in the recent times.

It is important for the sociologists to quickly understand the reasons for this simmering anger coming to the fore so quickly and suddenly. Besides the burning of three dalit colonies in Dharmapuri district, there have been a couple of minor (which means only 4-8 houses burnt and not 100s of houses) burning incidents near Neyveli (heartland of PMK). This can flare up into a full scale war, if the government doesn't act immediately.

Sunday, December 02, 2012

TN encounter killings

Two accused have been killed by police when they were being taken from Madurai to Sivaganga. These two are accused in the killing of a police constable sub-inspector named Alvin Sudhan couple of months back.

The encounter story is the usual police story. One of the accused apparently complained of chest pain. The police stopped the van, when the two jumped out and escaped. They were later found to be travelling in a two-wheeler. They were surrounded by police. The two accused then attacked the police with country made bombs. As a defensive measure, the police apparently shot and killed them.

The video footage released by the police show a few large sickles and various other weapon as if picked from a typical goonda arsenal.

The police version sounds so implausible and yet the media is not asking hard questions. People who call in during talk shows brazenly defend the police action, as a sort of revenge to Alvin Sudhan killing. Facebook and Twitter discussions support the police action.

Indians don't seems to understand the concept of a modern democratic state with a rule of law, independent judiciary, a just trial before a verdict is pronounced, the right to defence in a court of law etc. They seem to love the police state, where police barge in, shoot and then make up the evidence. Every single encounter killing in the state of Tamil Nadu in my living memory appears to be a sham. No independent verification of the police story, no explanation on whether such an action was really required etc.

This is not to defend the killing of the policeman. But in a civilised state, the criminal who caused the death will be caught, a fair trial given so that the people really convince themselves that the accused is indeed guilty, and then a punishment given commensurate with the crime, while at the same time the accused is given all the rights to defend himself.

Somehow, the citizen of this country does not seem to understand this process. He in fact thinks this complex procedure is a drain on our finances. He seems to want a quick solution, instant justice, a hollywood/kollywood form of draw a pistol out and pump a few bullets into the alleged killer's head.

But what about Alvin Sudhan, is the oft repeated question. What about him? Like so many people who have been killed in random violence or planned violence, Alvin Sudhan is just another victim. Like the software engineer who went to a TASMAC bar in Velachery to have a whiskey, and found himself caught between two gangs with lethal weapons fighting each other.

Random or planned killings cannot give police extraordinary powers to act on their own as if they are above the law. That in Tamil Nadu they do this with impunity is because the people support them.

I feel sorry for the people, because they will be at the receiving end one day.

Wednesday, November 28, 2012

FDI, DCT, Congress, BJP

Some folks seem to oppose FDI in retail trade and direct cash transfers championed by Congress, simply because those folks are, by nature, anti-Congress and pro-BJP.

I do not like the current Congress dispensation either.

Congress may have brought out Direct Cash Transfers primarily to attract the votes of the poor in the upcoming parliamentary election. However that alone should not be the reason to oppose this scheme.

BJP is yet to make its views on DCT, but you can safely assume that it will be negative.

This is a wrong approach. The right approach should be to evaluate this policy vis-a-vis BJP's own approach to Indian economy, growth and subsidy and then decide whether to support this or not.

Indian administrative set up is entirely corrupt. It is impossible to think of any department in a state or central government which is devoid of corruption. It may be only a thing of degree; some states may be less corrupt than some other states, but it will be impossible to find a state that is completely clean. Much of the money spent by the governments on the welfare of people is lost along the way. Again, there is no doubt here. The only argument is about what percentage is pilfered: Is it 15% or 85%?

What are the arguments against DCT?

(1) Subsidy itself is wrong. How long do we continue to provide such subsidies?
(2) Aadhar is faulty. Anybody can get an Aadhar card. This will encourage infiltration from Bangladesh.
(3) How is BPL determined? Who decides who should be included in the BPL list, which in turn will make them entitled to Rs 32,000 an year?
(4) Direct cash subsidy implies removal of indirect subsidies. This will impact those who are just above BPL, but may still need support.
(5) Grains in hand much better than cash in hand, as these folks will spend the cash on liquor.
(6) Indirect subsidy controlled the prices directly, and made cheap food, education and healthcare available directly to the poor. Direct cash may not be commensurate with the actual market prices of essential goods and poor may find life more difficult going forward.

Let me take each of the above.

(1) We can dismiss the first question straight away. We already provide subsidies. They were provided in an indirect manner. Whether we should provide subsidies (either direct or indirect) at all is a different question, not relevant to our current discussion.

(2) Aadhar seems shaky. There are many people who oppose the system because it violates privacy and because anybody can get an Aadhar card by giving random and spurious data. I don't think Aadhar card by itself entitles you to a subsidy package. With a bit of understanding of RSBY scheme (Rashtriya Swasthya Bima Yojana), I can say that the central government does have a list of BPL households on a district by district, taluk by taluk level across the country. This list may have a few dodgy households in it. Some genuine families may not find a place there. This problem exists even today. In Tamil Nadu, you can't easily get a ration card today. So, many deserving families don't get subsidised ration goods today. This will continue in the current model also. Some undeserving will end up getting extra Rs 32,000 cash while many deserving will not get it. But by and large, bulk of the population in this list will be genuine.

This is just my belief and how this will established and how the list will be cleaned up every year is to be left to the Central and the State Governments. We need to push them to come up with a workable mechanism.

I am less concerned about Bangladeshi infiltration as of now. I genuinely think it is a minor problem.

(3) & (4) How BPL families should be defined is a big question. I am sure various agencies we have follow different methods and thus come up with very different data. Also, what constitutes a poor in different states, from rural to urban regions should vary. It can't be a simple "annul family income" number. Also, the subsidy amount should ideally worked together with a state government. It need not be a flat Rs 32,000 per annum. Also, it may be desirable to consider multiple buckets (groups A, B C), who will get different subsidies based on the per capita earning of that particular family. It could be Rs 32,000 per annum to one group, Rs 24,000 per annum to another and Rs 15,000 per annum to the third.) This way, we can gradually reduce the shock to every group.

(5) Grains vs cash. It is quite possible that a whole lot of people may misuse the money and waste it on liquor or other vices. I suggest transferring the cash to the woman of the house rather than the "head of the household" who is usually a man. Women in poor households are more likely to spend the money wisely. They understand hunger and healthcare requirements better than men. Money in their hand will also make them more powerful in the family. In some cases, this may also make the women vulnerable to attacks from the man. It will have to be left to the law to deal with such situations.

(6) In the models of indirect subsidy, government purchased in bulk, thereby could get grains at cheaper prices. Now, too, the government can procure in bulk and sell goods through the ration shops. Only, the price will not be Rs 1 per kg. It will be Rs 10 or Rs 15 or whatever it is.

Now what could be the advantages?

The ration shop guys won't loot this and sell elsewhere at a higher price, because no one will pay any higher price than what is being charged. You can only arbitrage on subsidised goods, like the Tamil Nadu rice in Kerala market.

The ration shop fellow will have to be nicer to the public, because if he isn't, the folks will buy from a private shop. The price difference will be marginal. If the ration shop fellow is not nice, he may not have a job, because the shop will eventually be closed for want of customers.

People will not accept third rate, rotten grains because for that rate (Rs. 10/15, they can get decent rice elsewhere too). Now, they are forced to accept inedible junk, because they won't get them so cheap anywhere else.

Market shock can be best handled by few govt. run shops which will ensure that there is always a correctly priced alternative.

If the prices still increase for essential goods which were earlier indirectly subsidised, the government will have to take a look at whether direct cash transfer subsidy amount should be increased, and whether they can fund the increase.

I see enormous advantages in this model. This is certainly worth a try - even if it has been introduced by a Congress govt. for cynical political gains.

Tuesday, November 27, 2012

Direct cash transfer

Poll time: Ministers detail biggest reform measure "direct cash transfer" from Congress Headquarters

Indian central government has decided to offer subsidy to families below the poverty line directly through cash transfers to their bank accounts, as opposed to the prevailing indirect model today.

The amount per family per year seems to be large: Rs 32,000. For 10 crore homes, this amounts to Rs 3.2 lakh crore an year. How this is going to be rolled out while dismantling the current indirect subsidy is unclear.

At a certain level, some kind of subsidy is required to lift poor people up. Let us hope they use the money sensibly and not waste it away. In fact, the leftists are the ones who disapprove of direct cash transfers. They probably do not trust the poor to spend the money wisely on food, education and healthcare.

We have to see how this works in the pilot districts. It may be worthwhile that the money be transferred to the woman of the household rather than the man.

Friday, November 16, 2012

New Blogger app for iPad

Blogger has released its app for iPad yesterday. This is obviously much better than the earlier iPhone version. Hopefully now, I will blog a bit more in English.

There is a built-in camera feature for taking a live picture and embedding in a blog -- something that may make better sense within an iPhone app. Probably the iPad mini can make better use of this.

Just to test that feature... An image of one of our recent publication...

Monday, October 01, 2012


I chanced upon the book, Karl Jaspers on Philosophy of History and History of Philosophy edited by Joseph W Koterski S.J and Raymond J Langley, published by Humanity Books, couple of days back in Anna Centenary Library, Chennai. By the way, this library is a fabulous place to visit if you are a book lover.

This book offered a decent introduction to the philosophy of Nagarjuna, arguably India's most well known philosopher. He lived in the 2nd/3rd century CE in what is today Andhra Pradesh in India. Buddhism was undergoing a lot of changes then. Mahayana was being born from the earlier Hinayana version. Nagarjuna developed a thorough Buddhist dialectic to present the thoughts of the Buddha, which influenced scholars from around the world. Nagarjuna's Madhyamaka school of Buddhism (the middle way) paved the way for Ch'an and Hua-yen schools of China, the Zen tradition of Japan and the monastic philosophy of Tibet.

The two articles in the above book dealing with Nagarjuna are:
  1. "Karl Jaspers and Nagarjuna" by Malcolm David Eckel
  2. "Jaspers on Lao Tzu, Nagarjuna and Dialectic" by Richard N Bolsey
Karl Jaspers started studied the various philosophies of the world and published a book, "The Great Philosophers" in 1957. In that book, Jaspers considered three types of philosophers.
  1. The Paradigmatic Individuals. Example: The Buddha and Confucius
  2. The Seminal Founders: Plato
  3. The Original Thinkers: Lao Tzu and Nagarjuna
The typical western logic considers only two states: A statement is either (1) True or (2) False. However, Nagarjuna, following Indian tradition, was considering four different states: A statement is (1) True (2) False (3) Both True and False or (4) Neither True, Nor False. Malcolm Eckel adds that at times Nagarjuna was also considering (5) None of the above!

Jaspers saw Nagarjuna as a representative of the extreme possibility of transcending metaphysics by means of metaphysics.

Nagarjuna acknowledged the inadequacy of all speech and developed a precise logical procedure to examine all possible categories of thought and to demonstrate that none of them have ultimate validity.

Nagarjuna's view was that it was impossible to teach about ultimate truth without depending on the categories of conventional truth. The understanding of emptiness is the goal. But ultimately it is no understanding and no goal.

Nagarjuna's philosophy does not take a person out of ordinary experience to something or somewhere else but rather brings a person back through the practice of the bodhisattva path, into the realm of ordinary life and ordinary experience.

Eckel compares Nagarjuna and Nietzche as below:
Both prevent a person from coming to rest in any single position and both are meant to bring about a form of liberation. But both have different aims. One aims toward nirvana and the will to salvation; the other toward the will to power and the superman.
There was a nice summary of Nagarjuna at the end of Eckel's article, which I quote in full:
According to Jaspers, "Buddhism never resorted to violence, never forced any dogmas on anyone. Buddhism had no religious wars, no inquisitions, and never engaged in the secular politics of an organised church." Not only is this questionable historically; it is questionable theoretically. The master-narrative of the bodhisattva practice in which Nagarjuna's dialectic is placed, is to a large degree a narrative of power. Bodhisattvas are concerned about gaining all sorts of "masteries" and "powers" not only over their minds and bodies, but over minds of bodies of others. These masteries culminate in the figure of celestial bodhisattvas such as Avalokitesvara who are endowed with all the powers of Hindu gods. The will to power and the will to engender a superman (albeit of a rather different kind) are not far away from the system of values and practices that encompass Nagarjuna's dialectic, and both were given concrete expression in the struggle for power between different monastic communities in china, to say nothing of the fascination with power in all its modes that lies behind the practice of Buddhist tantra.
Bolsey summarises the philosophy of Nagarjuna according to Jaspers as below:
Insofar as this method of refuting every assertion of being or nonbeing is represented as universally valid, we have before us a doctrine. As such it has been called negativism or nihilism. But this is not correct. For what this doctrine seeks is an authentic truth which cannot itself become a doctrine. Hence, all its operations end in paradoxical statements that cancel each other out and so point to something else: "The Buddha says: My doctrine is to think the thought that is unthinkable, to practice the deed that is un-doing, to speak the speech that is inexpressible, and to be trained in the discipline that is beyond discipline.
There is plenty of material available online on Nagarjuna's philosophy, if you look around.

Friday, August 31, 2012

Apple vs Samsung

In the Apple vs Samsung case, the Californian court's jury verdict has gone in favour of Apple.

It is unclear to me how such important cases are handled by the jury. It is not a murder case or defamation case. The US should change its system of deciding on these copyright or patent infringement cases by jury and instead let this be handled by competent judges.

Charges like "copying" rounded corners for icons is ridiculous. I have seen rounded corner icons on the web for decades. A few other features such as 'bounce-back scrolling' and 'tap-to-zoom' are innovative original ideas, but still to be given a patent for such things is ridiculous. The patent office should never have allowed this. So many features in the computing industry have come about by way of copying and perfecting existing ideas.

Touch computing is a new area and has a long way to go. Only by way of copying and improving will there be progress in this space. As noted by the judges in Europe, Samsung's Android tablets/phones are quite inferior in experience compared to iOS devices. Yet, it is growing fast because of its range, price point and product roll out. Apple's attempts to curb this activity, in making the cheaper devices available to a large number of people, should be resisted. Invoking spurious patents for supposed innovations to block a competitor should be seen as anti-competitive and should not be allowed.

Let everyone copy ideas, reproduce and innovate!

Thursday, August 30, 2012

Kindle in iPad

I have acquired an iPad recently and have since been using Kindle app on this for reading books. Most of my recent book purchases have been through Kindle. The reading experience is better than what I had expected. It appears that I can read more pages in a given time (compared to reading the paper version).

It is still not convenient when it comes to reading a book lying down on a bed, as the iPad is somewhat heavier.

Kindle application on iPad appears to be quite efficient in power usage.

I do read a fair bit of Tamil books as well; but unfortunately, as of now, PDF is the only solution. As a publisher of Tamil books, I have access to all our books. I recently read Ponniyin Selvan (5 volumes - roughly 3000 pages in Demy 1/8) as PDF files through iBooks on iPad. Again, the reading experience itself was okay (though not as good as re-flown text of Kindle). Here too, I noticed that reading seemed faster than traditional ink on paper.

Ideal for Tamil books will be epub Unicode files, and a good reader that will handle them. Kindle itself may not be able to read Indian languages for quite a while.

Monday, April 16, 2012

Jairam Ramesh's value addition to the Microfinance sector

After phenomenally adding value as Minister for Environment by blocking various projects and then mysteriously approving them, in his new avatar Jairam Ramesh is looking to adding value as Rural Development Minister.

For too long, the Microfinance industry has been suffering because of unreasonable demands placed on them. The RBI regulation now states that they cannot charge more than 26% interest. Plus, their spread cannot be more than 10%. That is, if their cost of borrowing is 12%, they cannot even charge 26%. They can only charge 22%. But if their cost of funding is 18%, then they cannot charge 28% but only 26%. Thus the maximum spread is 10%.

Then, there are other restrictions. They need to have a minimum of 10 crore equity. There are quite a few Microfinance companies with equity considerably lower than this. They have to now scramble and get this equity. But given that the market situation is so bad, no one is likely to be interested in investing in them, or if they invest, it will be at the face value or perhaps even at a discount, thereby diluting the promoter's equity completely.

Nationalised banks have been unwilling to lend money to the Microfinance companies, as they demand a clean balance sheet and no loss. But given the whacking these companies received last year thanks to brain-dead AP government law and the SKS mess, most companies have made a loss.

So, these companies have nowhere to go, and they were seriously looking forward to the Microfinance bill from the Govt. of India. Now steps in Mr. Jairam Ramesh saying that this bill will affect Self-help groups (SHGs). In what way, I am unable to understand. Is the proposed law asking money to SHGs to be stopped? No. The proposed law merely supersedes silly laws by state governments.It creates a regulatory authority to deal with these institutions instead of allowing every single state government to thrust its own laws.

Jairam Ramesh has a problem with "Akulas". In fact, the entire Microfinance industry has a problem with Akula and his SKS which in their extreme desire to grow went overboard. But then the new set of regulations have tightened the sector enormously. Can the Minister mention another name or another company? How can he tarnish the entire industry using a single name?

The delay in passing this bill will make the life extremely difficult for many small Microfinance companies. The lack of clarity will force fewer private banks to lend money to Microfinance companies. The same thing will keep venture capital firms to stay away from investing in this sector.

The losers will be the promoters of Microfinance companies and millions of poor people. SHGs cannot be winners either. The winners will be moneylending sharks and Jairam Ramesh like politicians.

Thursday, April 12, 2012

Earth quake and Nuclear reactors

This was my first experience. The tremors were mild in Chennai. I was in the middle of recording couple of book reviews for Makkal TV.

I was in Chennai during the 2004 Tsunami and didn't feel any tremors then. I do remember vividly the panicked crowd running on foot and in autos carrying all their valuable belongings. Yesterday was in the middle of work. Almost everyone in the office wanted to leave immediately as they felt the traffic will pile up, little knowing that they will be only adding to the chaos. Only three or four of us stayed on till 6.30 PM.

The talk now is centered on Kalpakkam and Kudangulam atomic power plants and their safety. Tamil Nadu is not in a heavy seismic zone. The tremors we felt yesterday were insignificant. In fact, Tamil Nadu didn't even feel anything of this kind during the Maharashtra, Gujarat and Pakistan earthquakes in the last two decades in which thousands of people had died

I can understand opposition to nuclear plants on the basis of strong principles. To base it on such weak arguments as lack of safety under mild tremors is ridiculous. But I guess it is futile to discuss these things as neither party is willing to listen to reasoned arguments.

Tuesday, April 10, 2012

A brief history of Citibank

There is a nice advertisement, a sheet over today's Mint, from Citibank, to commemorate its 200th year.

1812: Citi opens as The First National City Bank of New York.
1866: Citi funds the transatlantic cable.
1904: Citi funds the Panama canal.
1948: Citi supports the Marshall plan to rebuild Europe.
1956: Citi backs uniform cargo containers.
1958: Citi backs the commercial Jetliner.
1977: Citi pioneers the ATM.
2011: Citi is the first card in Google Wallet.

I don't see how the 2011 move is that great. However, the other ones are, so if I live for the next 20 years, I will understand the significance of Google Wallet move.

I need to find a good history of Citibank.

Monday, April 09, 2012

Odisha kidnappings

It will be wrong on the part of the Odisha government to accept the demands of the Maoists and release the jailed Maoist guerrillas, in order to secure the release of an Italian tourist. There is an MLA in the custody of the Maoists and there will be a demand for releasing few more Maoists to secure his release.

In this connection, I will quote a portion from the Wikipedia page of John Paul Getty Jr.
Getty initially became reclusive after the death of his second wife in 1971. He moved to Rome as head of Getty Oil Italiana. In 1973, his eldest child and son, Paul III, was kidnapped in Rome by Calabrian mobsters and held in the Calabrian Mountains, chained to a stake in a cave. Getty did not have enough money to pay the $17 million ransom demand, and his father refused to help, saying "I have 14 other grandchildren, and if I pay one penny now, then I will have 14 kidnapped grandchildren." However, when one of his son's ears was delivered by mail to a newspaper in Rome (delivery had been delayed by three weeks because of a postal strike), his father finally agreed to help out with the ransom payment by making the ransom payment a loan to his son.
Eventually the ransom was paid. But the real wisdom lies in this statement: "I have 14 other grandchildren, and if I pay one penny now, then I will have 14 kidnapped grandchildren."

If even one Maoist guerrilla is released from the jail, there will be more kidnappings, more negotiations and more releases. You will forced to go down that route again and again. So do not give in to Maoist demands. If it means losing the lives of an Italian tourist and an Odisha MLA, so be it.

Maoists should be fought, and finished off.

Thursday, April 05, 2012

Greece suicide

A few years ago, I was attending a meeting organized by a private equity firm. They had invested in our company at that time. (Since then, they have exited.) Things were quite bad then. The US financial markets had crashed, taking with them a whole lot of companies around the world. Countries were on the verge of bankruptcy.

A Swiss investment banker, one of the principals who deals with billions of dollars of investment talked at length about the hardship Europeans were going to face. There was a talk of Greece, Spain, Portugal, Ireland, Italy and several other countries.

People living in these countries have not seen dire poverty since the second world war. There is unemployment benefit and a decent social security system. But the countries are over-leveraged and in serious debt problem. The economy is tanking. The middle class are in the brink of becoming poor. Youngsters have lost their confidence.

The Swiss banker was talking about the kind of turmoil these countries were going to go through. The reported suicide by the 77 year old Dimitris Christoulas is the beginning.

If you do not have any savings and your Government is cutting down on its expenditure (and in particular social security payments such as old-age pension or the unemployment allowance) where will you go? If your children themselves are trying hard to make their ends meet, how will they support you? That too in countries where parents supporting children above a certain age and children supporting parents in their old age is not known?

There are thousands of farm suicides in India. A majority of Indians are wallowing in poverty. I am not trying to compare one suicide in Greece to the situation of millions dying or mal-nourished in India. However, in case of India, contrary to what the "opponents of neo-liberalism" would say, I have only seen steady, albeit slow, progress towards a better life.

What the single incident in Greece has shown is the beginning of the trend towards more such gory incidents - deaths, street fights, crime and overall heart ache - in Europe. It is for this that this event is significant.

We are about to witness one of the worst decades for Europe.

Wednesday, April 04, 2012

IPL not moneyball anymore - Hindustan Times

IPL not moneyball anymore - Hindustan Times

I am not a major fan of IPL. The first two seasons I saw a quite a few matches. The third season, very few. And the fourth season none at all. It had become too boring, for me.

I did predict that IPL will lose its sheen, if the BCCI did not reform itself. Now, the ad rates and ad bookings show clearly that TRPs are falling and advertisers are staying away.

In the meantime, Lalit Modi, with all his bluster, has said in an interview with The Hindu that IPL will contribute between 65 to 70% of the total income of BCCI! This shows what sort of warped thinking Modi has, and probably that is one thing the current bigwigs of BCCI share with him.

Tablet galore

First there were grey market Chinese made Android tablets. I bought a 7" resistive touch one, running Android 1.6. Then I bought a 10" resistive touch one, running Android 2.2.

Then the Indian government announced Aakash, its cheap 50$ variety. Supposed to be manufactured by Datawind, this went nowhere. In any other sensible country, the government and the minister responsible would have been taken to the task. Not in India. Kapil Sibal continues to be the minister for IT, Telecom as well as education through the Human Resource Development ministry. Make no mistake, Aaksh 2 will also be a disaster.

Datawind said it will push its own tablets priced around 4,000 Rs in the Indian market. Then, Wishtel announced it was launching its own low cost tablets.

Right through this period, we did have the Apple Ipad in the market while Samsung and Dell were selling their Android pads and RIM selling its Playbook versions.

Just recently, two low-cost players have announced their versions. One is HCL and the other Micromax.

The news reports presenting these announcements are rarely detailed. There are some key factors which determine whether the pricing is fair, such as whether the screen is resistive touch or capacitive touch, physical size of the screen (7" or 10" or ...), pixel density, chip speed, weight, OS (if Android, which version), battery life, storage capability, whether 3G compatible or only wi-fi, camera (if any, or 1 or 2 and their megapixels) and so on.

It is left the specialty sites to figure out exactly what is there in these devices and whether the price quoted is reasonable.

Both HCL and Micromax are looking to bundle educational content, in significant contrast to Apple, Samsung etc. In this, HCL/Micromax have really understood the Indian market. The children want fun and games but the parents want their children to study. Therefore, throw in some educational content to hoodwink the parents and they will buy it for their children. Then the children can happily play Angry Birds - all four of them.

It appears that in the short run, there will be more Android devices out in the Indian market. Apple Ipad will remain a premium product. A sub 10k Android pad will be easy to buy for most middle class. That is where things will turn out to be sad for most buyers. All these Android devices can not easily be upgraded to "newer" operating system. Their capability is highly limited. Most of them will not be Indian language compatible. Rooting the devices will not be easy. That sort of talent is still not available in India.

Even if rooting is possible (since most of the products are Chinese made and white-labelled and passed off as if manufactured in India), very few customers will even have the gall to do this. If you root the device you may lose the warranty and your manufacturer may not support you.

We have a long way to go.

Monday, April 02, 2012

AIESEC Youth To Business Forum @ Sastra

I spent yesterday at Sastra University, Thanjavur, the event being AIESEC Youth To Business Forum. Here are some of my observations:

* The students are amazingly confident, much more than what we ever were during our days.
* The event was entirely conceived, planned and conducted by the students and done quite well too.
* A number of them consider entrepreneurship as a serious career option, which is probably not all that surprising.
* Several of them have very interesting business ideas, and if implemented may become quite successful.

* However, most of the ideas revolved around Internet and e-commerce. Some on marketing and retail.
* I couldn't find anything related to core engineering.
* I found that girls were not as enthusiastic as boys when it came to talking about start up ideas, though they were easily 50% of the entire group. Start-up space is almost fully all male, it appears.

It looked very positive, in all. I do expect some of these students to go on to build very exciting enterprises.

Inter-linking of rivers

There is a clamour for river interlinking mostly only from Tamil Nadu.

There is a clear reason for it though. Tamil Nadu is one of the most water-starved states in India. It has problems with all the neighbouring states in sharing river water. The main cause of concern for Tamil Nadu is in getting a fair share of Cauvery water. Then, there are lesser problems such as Mullai Periyaru with Kerala, Palaru with Andhra and so on.

Andhra had also agreed to provide Krishna river water to Chennai. This is not based on any riparian claim, but Andhra had agreed to this on goodwill. At times, Chennai gets some water, but this is not always automatic, left to the wishes of Andhra.

As other states try to appropriate the waters of the rivers that flow through them for agriculture and drinking water supply, Tamil Nadu will be the big sufferer.

Since every once in a while there are floods in North Indian perennial rivers, the idea of linking up all the rivers in India was mooted.

To go into the geological difficulties or the environmental impact will not be necessary here.

My view is that, the political landscape will simply not allow this to work. River interlinking is not the same as laying multi-lane highways. Every state wants it. All benefit from it, some more than others. Roads are zero sum games. But river water is. One can keep coming up with fancy schemes to make use of any excess water.

As water is not metered and no one is notionally paid any money, there is a tendency to waste water in large quantities. This is not going to change in the years to come. Farmers need more water; industries need more water and urban settlements need more water.

So, even if we miraculously link all the rivers, Tamil Nadu will find that the results are not to its liking. The project will cost a lot, will take many years to build, and after this, the first few years may be good for Tamil Nadu. Then, Karnataka and Andhra will find more ways of diverting additional waters to their own starved population, thereby making Tamil Nadu as poor as before.

What Tamil Nadu requires is something else. It is to make better use of the rain water. Recharging of all the water bodies effectively alone is sufficient to solve drinking water problems across the state. Further, it will go far in solving the irrigation requirements in many regions. Parts of Tamil Nadu will be arid, and rain water is not going to help these regions. It is here that Tamil Nadu should look at purchasing water from the neighbouring states. One way of doing this is to produce large amounts of electricity and use that as a barter chip.

Tamil Nadu is better placed than Karnataka and Andhra to produce more electricity. Tamil Nadu has the investing power as its finances seem to be much better. It can borrow much more money than the neighbouring states. The problem is with its approach to the industry. If it can wake up and become industry friendly, then it can achieve power surplus, and with it will come negotiating ability to purchase water.

This will be easier to achieve than believing in interlinking of rivers.