Parisista

Space.com is reporting that a fleet of NASA spacecraft launched less than eight months ago has revealed new insights into the forces that cause the northern lights, including giant magnetic “ropes” between Earth and the sun. Understanding the cause of auroras will help scientists solve the mystery around solar flares and what causes them and get a handle on the outer space weather. I don’t so much understand the geo-physics of why the solar winds slams into the earth’s magnetic field in the magnetosphere. I’m simply enamoured by the spectacular shows, gallery here and here. Chasing Auroras? I could take this for a living!

Photograph by Phil Hoffman

Just finished reading the review of V. Raghunathan’s book titled, Games Indians Play: Why We Are the Way We Are.
In his book, Raghunathan, a former professor at the Indian Institute of Management in Ahmedabad, uses game theory — a branch of mathematics — and related concepts such as the prisoner’s dilemma to explore why Indians so often tend to focus on winning immediate gains at the cost of long-term benefits. He further goes on and theorizes that Indians are privately smart and publicly dumb. He also mentions that Indian’s ability to understand the need for cooperation is very low. Indians believe that cooperation and selfishness cannot go together.
Knowledge@Wharton is carrying an interview with the author. It is a pretty good read.
I was dumbfounded initially, but I would second a lot of the “findings.”

Take 1. High Real estate prices. I was traveling to Bangalore last month and got a chance to meet a few entrepreneurs who are looking at the food services sector for new businesses. The thing which was stopping them was the prohibitive cost of real estate as part of their total operations cost. The slice of real estate expense could be easily between 20% – 30% which leaves little wiggle room for product pricing, labor costing and equipment.
Take 2. India Inc.’s overseas acquisitions. Indian companies’ appetite for acquisitions has increased drastically. In the first 6 months of 2007, India Inc. has struck more than 500 deals worth $55 billion. This started with $5 billion in 2005, $25 billion in 2006 and aiming to cross $100 billion in 2007. How are these buyouts funded? Simple, the companies leverage their balance sheet, the price of the equity in the stock market and a very positive credit rating for India. In the Tata-Crous deal, Tata Steel cobbled together a loan of £3.5 billion ($6.8 billion) from Standard Chartered, Credit Suisse, ABN Amro and Deutsche Bank. Smelling the success of past deals like this (a la Warburg Pincus making $700m from a $300m investment in Bharti-Airtel), big-name U.S. Private Equity firms like Blackstone Group, Carlyle Group and General Atlantic Partners, etc. have started pouring money in India. Only yesterday, Blackstone has coughed up $165 million for a 50% equity stake in Gokaldas Exports, which supplies to Gap, Nike, London Fog, etc.
Take 3. Inflation and credit crunch. Due to over-investment in non-organic areas, the money is flowing to non-core sectors like real estate and stock market further fuelling the cycle of increased cost of living and increasing salaries. The prices of essential commodities are rising faster than the rest of the developing countries. An upward march of rupee vis-à-vis dollar by 8% has curtailed the inflow. However, the flipside to the rupee appreciation was the wrath export units are facing with competition from other cheaper destinations like Pakistan and Bangladesh. To further control money supply, banks have increased interest rates — which have helped control inflation, but tighten the credit to businesses.
Take 4. Global subprime mortgage crisis. A lot of banks and Private Equity players are part of the subprime downward spiral in the US and Europe, also happen to be the players in India Inc.’s growth. The subprime losses are being touted at $150 billion in US alone. The clear outcome of the subprime crisis is a change in risk appetite of banks and FIIs who are pouring money in India and tightening of the money supply to cover their subprime losses.
India’s GDP is being pegged at around 10% but this has not made any dent for the common man. Government’s monetary policies are very cyclical without any insight into longer term plans for expansions and fiscal policy. This day all the factors are working in favor of India Inc. any cyclic change or even a 20% drop in stock market (it had a 200% run-up in last 2 years) would reverse India’s fortunes in the shorter term.

Today is August 15th. 60 years ago in 1947, India gained Independence from United Kingdom which was a culmination of more than 100 years of freedom struggle. Quoting India’s first Prime Minister, Jawaharlal Nehru in his famous Tryst with Destiny speech, I salute to the nation.

“At the stroke of the midnight hour, when the world sleeps, India will awake to life and freedom. A moment comes, which comes but rarely in history, when we step out from the old to the new, when an age ends, and when the soul of a nation, long suppressed, finds utterance….. We end today a period of ill fortune, and India discovers herself again. “

At 60, India is rediscovering again with it’s GDP at 10%, Per Capita Income at $734, and literacy rate at 65%. There’s a long road ahead.

I found this gem, while confronting myself on couple of topics.
Don’t read it like a prayer, nor like a morning chant; Read it like a war cry, or read it if you are ever confronted by fear or the lack of free thoughts confront your self.

Where the mind is without fear and the head is held high
Where knowledge is free
Where the world has not been broken up into fragments
By narrow domestic walls
Where words come out from the depth of truth
Where tireless striving stretches its arms towards perfection
Where the clear stream of reason has not lost its way
Into the dreary desert sand of dead habit
Where the mind is led forward by thee
Into ever-widening thought and action
Into that heaven of freedom, my father, let my country awake.

- from Gitanjali, Offering of Songs, published in English in
1910, written by Nobel laureate Rabindranath Tagore.