Do it yourself

The rivalry between the United States and China is often described as a new Cold War. While the comparison is tempting, it is also misleading. The Cold War (US vs USSR) was characterized by ideological separation (Communism vs free market), minimal economic interaction, and rigid alliances (NATO vs Warsaw). Present conditions are materially different. The US and China are deeply economically intertwined. Trade volumes are substantial. Supply chains are integrated. Financial markets are linked. Neither side can afford full disengagement without significant self-inflicted damage. What is happening instead is selective rivalry to gain advantage in the terms of trade and control over resources. Both countries are focusing on the sectors they consider strategically sensitive, e.g., advanced technology, defense-related manufacturing, data infrastructure, and critical resources. In these areas, they are adopting a policy of control rather than cooperation. In other sectors, pragmatic engageme...

For much of modern history, power was mostly measured by military strength. Borders shifted through conquest, and influence was enforced through force. In the past couple of decades, there has been a gradual shift in this paradigm. While military capability still matters, the primary instruments of power today are economic and technology. In the contemporary world, access to capital, technology, markets, and resources often determines outcomes more effectively than armies. Trade rules can shape behavior. Financial sanctions can immobilize economies. Control over technology standards can define the future of entire industries. Unlike traditional warfare, economic power operates quietly. There are no declarations, no battlefields, and no formal endings. Yet its effects can be just as lasting.   The latest events in Venezuela also need to be looked at from this Lense. Export controls, tariffs, financial restrictions, and regulatory barriers are now routine tools of statecraft. They ar...

  The India specific actions of President Trump in the past six months have evoked a varied response from various stakeholders. ·           The policymakers have been quite guarded in their response. Prime Minister Modi has rhetorically emphasized on the need to be self-reliant and adopt  Swadeshi  (Made in India products), but so far, we have not heard any specific policy or plan to counter the US aggression. Most of the concerned ministers and bureaucrats have repeatedly expressed hope that India will manage to finalize an “honorable” trade deal before the end of 2025. The only detail they have shared is that India shall not compromise on the interests of its farmers’ and energy security concerns.  Prima facie , the bureaucratic and diplomatic effort is to  “restore status quo ante” , to the extent possible. ·           Industry associations also seem to be preferring a...

The Indo-US relations have never been linear and secular like Indo-Russia (Indo-Soviet) relations. Moreover, the Indo-US relations have mostly been transactional and opportunistic; with very little connect on cultural and social level. Both countries have based their strategies on their respective abilities to exploit the available opportunities. In the past three decades, India has significantly gained from the shortages of highly skilled human resources in the US. We have also shared the gains (with other emerging economies) from the US strategy of relocating their manufacturing processes. The US has benefitted from selling technology, energy and defense equipment to India. Besides, India has been an attractive high growth potential opportunity for US capital. Evidently, the US administration now seeks to redefine this transactional relationship. The present strife in the Indo-US relations may therefore sustain much longer than what most of us would have expected a couple of mont...

2025 is proving to be an interesting year for traders in the Indian stocks. The traders have faced multiple challenges in the past eight months; and had some good opportunities to make extraordinary profit. More notably— What made traders’ life tough ·          The external environment has been volatile. Geopolitical conflicts in the Middle East had escalated materially. The war between Russia and Ukraine continued and developed a new trade/tariff angle for the Indian economy. India engaged with Pakistan in a small but intense war that could have serious long-term repercussions for regional geopolitics. These events caused sharp volatility in the market, causing exacerbated margin calls and losses to the traders. ·          The US imposed reciprocal (25%) and penal (25%) tariffs on imports of merchandise from India, making Indian exports to the US significantly uncompetitive in comparison to the tradit...

  The Federal Open Market Committee (FOMC) of the US Federal Reserve (Fed) maintained its policy rates at 4.25% to 4.5% range, by a majority vote. It was the first occasion since 1993 when two Fed governors voted against the majority decision. Fed governors, Michelle Bowman and Christopher Waller, wanted a 25bps rate cut at the meeting, concluded on Wednesday. The majority decision of the Fed to not cut rates is apparently against the wishes and open demand for a rather drastic cut in the Fed policy rates by the US administration, especially President Trump. Strong April-June quarter GDP data and July private payroll data perhaps weighed on the Fed decision. The Commerce Department’s advance gross domestic product (GDP) report on Wednesday showed growth of 3.0% for the April to June period, above the 2.5% growth expected. US GDP shrank by 0.5% in the January-March 2025 quarter. U.S. private payrolls also increased more than expected July, rising by 104,000 jobs in July 2025 af...

Antimicrobial resistance becoming ominous Antimicrobial resistance (AMR) is fast emerging as one of the most ominous health concerns at global level. As per the  World Health Organization  (WHO), “Antimicrobials – including antibiotics, antivirals, antifungals, and antiparasitic – are medicines used to prevent and treat infectious diseases in humans, animals and plants. Antimicrobial Resistance (AMR) occurs when bacteria, viruses, fungi and parasites no longer respond to antimicrobial medicines. As a result of drug resistance, antibiotics and other antimicrobial medicines become ineffective and infections become difficult or impossible to treat, increasing the risk of disease spread, severe illness, disability and death. AMR is a natural process that happens over time through genetic changes in pathogens. Its emergence and spread are accelerated by human activity, mainly the misuse and overuse of antimicrobials to treat, prevent or control infections in humans, animals and pla...

It is a common adage amongst the financial market participants that “When America sneezes, the rest of the world catches a cold”. The origin of this belief is the global market turbulence in the aftermath of 1929 Wall Street crash. In the past 100 years, whenever the US economy or markets have faced any serious problem, most of the global economies and markets have witnessed elevated volatility and erosion in asset prices. The prime reason for this correlation of the US economy and markets has been the disproportionately large size of the US economy and markets; dominance of the US dollar in global trade; and over-reliance of emerging markets on the US for investment, development assistance and humanitarian aid. In the past couple of years, serious concerns have emerged about the sustainability of the US public debt and fiscal deficit. The overall GDP growth has been aligned to the average of the post global financial crisis (GFC) period. The efforts to accelerate growth have not yield...

  Trump: Hey Susie, you’re looking absolutely fantastic, nobody does it better! How’s the morning going? Did my posts on Truth Social and that failing platform “X” – terrible name, by the way – absolutely ROCK the world last night? Total game-changers! Susie Wiles: Sir, you’re the greatest President in history, nobody even comes close! The entire planet is glued to your accounts. Your posts are sending shockwaves across the universe – markets trembling, governments in a frenzy. We’re doing phenomenal, the best any administration has EVER done! Trump: Fantastic, just fantastic. I knew it! Show me the posts we’re dropping today – we’re gonna dominate! Susie Wiles: Right here, Sir, the absolute best ammo for today’s battle! Trump: Susie, you’re a genius, just brilliant. I love you, you’re tremendous. Fire off a post every 10 minutes, keep ‘em shook! Oh, and send Little Marco in, pronto. Marco Rubio: Good morning, President. How’s the greatest leader in the world doing today?...

  India’s external debt hit US$736.3bn by March 2025, a 10% jump from last year, with a significant portion (over 41%) of the debt maturing soon. As the US threatens 500% tariffs on countries buying Russian oil, including India, investors need to evaluate: Can India afford a confrontation with the US, China and other major trade partners, and could it withstand a covert economic embargo? Here’s my take, may be naïve and ill informed, but nonetheless relevant. India’s External Debt According to the Reserve Bank of India (RBI)  latest release , India’s external debt stood at US$736.3bn at the end of March 2025, with a debt-to-GDP ratio of 19.1%. Key highlights of the data are: Long-Term Debt:  US$601.9bn, up US$60.6bn from last year, with commercial borrowings and non-resident deposits driving growth. About 77% (US$568bn) of this debt is owed by non-government entities. The non-government debt is almost equally divided between financial institutions (US$271.3bn) and non-fin...

The Reserve Bank of India holds US$702.78bn in foreign exchange reserves. In the popular macroeconomic analysis, especially in the context of the equity market. this piece of data is often used as one of the points of comfort by analysts. This data could be viewed from multiple standpoints. For example – Is it adequate to pay for the necessary imports in the near term , assuming the worst-case scenario of no exports could be made and no remittances are received. Currently, India’s monthly imports are appx US$67bn. However, a material part of these imports is crude oil and bullion. A part of the crude oil and bullion is re-exported after refining/processing. I am unable to figure out the precise net import number for domestic usage, but it would be safe to assume that about three fourth of US$67bn, i.e., US$50bn is for domestic usage. Allowing another 20% for “avoidable in emergencies” category of imports, we have appx US$40bn/month import bill payment obligations. By this benchmark we ...

The script in the US is playing mostly on the expected lines (see   here   and   here ). Department of Government Efficiency (DOGE) – crash landing Department of Government Efficiency (DOGE) is apparently on its way to crash land, with the pilot (Elon Musk) ejecting himself out shortly after taking off. DOGE’s actions have faced multiple lawsuits, with critics arguing that Musk and his team have violated federal laws, union agreements, and civil service protections. A federal judge halted parts of USAID’s shutdown, and courts have restricted DOGE’s access to payment systems. Despite Musk’s goal to cut $2 trillion from the federal budget, 2025 spending is slightly up from 2024, per Brookings Institution data. Mandatory spending (e.g., Social Security, Medicare) limits achievable cuts. Over two million federal employees were offered buyout deals, with some agencies facing mass layoffs. However, some fired staff have been rehired, indicating implementation challenges. Though...