Category Archives: India ExPat living

11 April 2023 · 1:07 pm

First impressions of India six weeks after arriving

I last lived in India in 1977 as a schoolboy in Nagpur, famous for oranges and not much else. With a few months left before their ‘indefinite leave to remain’ visas lapsed; my parents called time on their two-year sojourn in India. Sure, I’ve since visited for work or family occasions, but India was just a backdrop for something else. Usually, I was reeling with jetlag, amidst a crush of half-remembered relatives at a wedding, or too overdosed on sight-seeing to pay attention to the changes that had occurred while I was gone. In any case, I wasn’t living in India I was breezing through its manicured hotels or couch surfing in relatives’ spare rooms.

The India I experienced half a lifetime ago was through ten-year-old eyes. I noticed beggars clustered around the temples my grandmother made me go to. Many of whom missed limbs, as India was home to around five million lepers. I remembered health-and-safety concern devoid Diwali fireworks in our backyard when my cousins and uncles packed kilotons of rockets under a steel bucket to despatch it into orbit. I loved holiday fairs with gaudy lights and charcoal flames, stalls selling peanuts boiled in brine, and Ferris wheels powered by steam-aged engines. My brother and I would travel back and forth to school in a cycle rickshaw and play in streets where cows walked freely, and cars were few.

Since moving here in February, I have seen no lepers, in fact, no beggars at all, though downtown Mumbai and Goa might only partially represent India. India’s efforts at space exploration have come on since my family’s pioneering efforts; its space agency has had success with its reusable launch vehicle programme, reducing the costs of deploying satellites. Maybe one day rivalling SpaceX. Cycle rickshaws have been replaced by CNG-fuelled three-wheeler autos or taxis. An ambitious but painfully slow build-out of Metros is being implemented in Mumbai and Nagpur. To date, Mumbai’s consists of three partial lines, which will one day rival those in Chinese cities. A couple of weekends ago, we took a forty-minute trip from Andheri to the Sanjay Gandhi National Park to see the 10th-century Buddhist Kanheri caves.

The biggest change I see is that my Indian family has died or migrated. Few people are left in Nagpur. Many of my cousins have joined their parents and flowed into the huge Indian diaspora looking for better-paid jobs in Dubai, US, Australia, and Canada.

I’ve met many people who spent a few years overseas returning after a foreign degree and a few years of professional life in tech or Wall Street. Those that come back find the country’s plentiful domestic staff and cheap cost of living eclipse the obvious disadvantages. I write this having just chased the Devonian-era-sized cockroach across our spotless flat and spent a fitful night praying the sporadic power cuts would not deprive me of AC-induced sleep.

We’ve had to buy lots of things quickly. India is cheap, except for imports. Our broadband costs ₹799/month (£8/month), our 4G mobile monthly charge is around ₹500/mn, a pizza at our nearest 5-star hotel ₹900. Quality is comparable, if not better than UK. Streaming companies like Netflix, Amazon Prime and Spotify charge Indian customers hardly a tenth of UK prices. But to subscribe you need an Indian phone number, bank account perhaps IP location to prevent foreign free loaders. This implicit subsidy to the middle-class Indians (some £300 per person) dwarfs aid flows to the country!

India’s best-selling car, the Maruti Suzuki Baleno, costs ₹800,000 and has decent AC, sound system, sat-nav and rearview cameras.  India used to be the last place in the world still making the Oxford Morris (twenty years after production ceased in UK), by contrast the 2015 iteration of the Baleno was launched in India a year ahead of its launch in the UK. Maruti-Suzuki now sells around two million cars annually, comprising two-thirds of its parent Suzuki’s global production. India has become a net exporter of cars, with a trade surplus in vehicles of $5.2bn.

The grown-up me is aware of many other changes in India over the last forty years. The Indian exchange rate dropped from 15₹/£ to around 100₹/£. The population has doubled from 650 million to 1.3 billion. GDP per head in purchasing power parity and constant 2017 USD has increased from $1,800/capita in 1990 to $6,600 in 2021. Over the same period, the global average increased by 70 per cent to $17,000. India’s cheapness is crucial; if you don’t adjust for the purchasing power parity, today’s per capita GDP is just $2000 / capita. The low prices for non-tradable goods like mobile phone tariffs and services like bus fares make life in India tolerable for Indians.

The steady fall in the exchange rate is puzzling. Much of it occurred between 1990 and 2000 and after 2007 and is despite India now being a significant exporter of services, manufacturing and even some food items. I’ll cover this in a future blog.

The other thing the grown-up me notices is the G20 summit. It’s hard to ignore. Omnipresent billboards declare One Earth, One Family, One Future, and the Prime Minister’s big brotherly face looks down on you constantly. Unlike the UK, India does not have much of a seat at the big boy’s table. Despite being the world’s fifth largest economy, it’s not a member of the G7, the UN’s security council, OECD, the EU, NATO, or any other place the big economies talk. Chairing the G20 is a big deal for the political classes. When I left India in 1977, the country was almost a pariah. Indira Gandhi had declared an Emergency, suspended the constitution, imprisoned political rivals, and postponed the general election. In September, Narendra Modi will welcome Biden, Xi Jinping, and the other heads of state. Goa is in a state of continuous reconstruction, awash with ‘Smart city’ and G20 funds to impress officials and second division ministers attending the eight meetings scheduled for the state.

Many have asked why Maya and I upped sticks and relocated to India. India is changing fast, and we wanted to be here to watch, and help make its development more sustainable.  We come armed with our OCI card, allowing us to work, and some savings. Goa is also an incredibly beautiful place to live and write. More on that in the next post.

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7 April 2019 · 6:50 pm

Financing the war on climate change

On 12 April 1912 the Titanic set sail. Two days later, while in the Arctic seas Captain Edward Smith received 7 iceberg warnings over the course of the day. But he followed standard procedure which was to proceed at full speed on the basis that the lookout would provide sufficient warning and the ship could steer or smash its way through. Based on backward looking historic data this was smart thinking. He had a schedule to keep, he was expected in New York in three days, and he was after all captain of the largest and newest boat in the world.

At 11.40 pm the lookout spotted an iceberg dead ahead. The engines were stopped and the ship attempted to evade. At 11.50 it struck the iceberg.  At 12.05 the order was given to abandon ship. At 2.05 am the last life boat departed. 700 people were saved 1500 died. There were still plenty of space on the lifeboats but there hadn’t been enough time to get off.

The financial sectors response to climate change is alarmingly similar. Full speed ahead finding and exploiting new fossil fuel assets even though the atmosphere doesn’t have the capacity to safely absorb what we already know about. 30% of bonds and equity is in sectors vulnerable to stranding: natural resources and extraction, power utilities, chemicals, construction and industrial goods.

People in this room all know that these companies are going to have to take massive write-down at some time over the next 15-20 years. They are praying to God they’ll reach the lifeboat before the ship hits the fan. (Forgive my bad taste in jokes)

I am going to talk about the role financial regulators and central government need to play to avert catastrophe to turn the billions into trillions? I make three key points.

Embedding the TCFD’s [Taskforce on Climate-related Financial Disclosures] recommendations is a good foundational step. This report has yielded some important benefits: the financial regulators largely accept systemic risks to the banking and insurance sector and agree something needs to be done. TCFD provides a language for talking and thinking about them: transition risks, climate risks. It asks institutions to establish governance and strategy around climate and undertake scenario analysis which is disclosed to stakeholders.

Central Banks’ Network for Greening Financial Systems is the most important international forum. It shares experiences and best practice. The Network’s three work streams are: sizing the impacts of climate on the economy (including low probability tail risks), mapping how current supervisory practices should be changed, scaling up of green finance.

Finance ministries also have a major role to play, both as direct issuers of green bonds, and also in providing financial incentives for others to issue. The largest sovereign issuer is currently the French OAT with 5 billion Euro new issuance last year some 1% of French Government spending. Singapore and Hong Kong governments provide subsidies to cover some of the costs associated with issuing green bonds.

But that’s not what truly ambitious looks like. We need to look back to the war to see real intervention. Between 1942 and 1945 the US government debt rose from around 50% of GDP to 106% of GDP. Unlike climate change the war was commonly perceived as a clear and present existentialist threat and the country’s financial systems got behind it.

Was debt incurred to fight the war wasted? Of course not. As well as allowing the Allied countries to maintain their freedom this expenditure created a raft of technological benefits that transformed the 20thcentury at least as much as the war itself: the Manhattan Project created fissile materials used in nuclear power and bombs, Bletchley Park produced the first pre-semiconductor computers and cryptographic algorithms. Then there was RADAR, jet engine aircraft.  What marvels will a green New Deal unlock? And without the body bags.

A month ago today a small number of left-leaning Democrat representatives signed a resolution to fund a Green New Deal to transform US energy, transport and buildings stock. In their resolution they say US wildfires would be twice as bad as now by 2050, and by 2100 US climate related losses would be $500 billion/yr ($2000 /person). Its opponents say the cost of implementing the Deal would be $5 to 9 trillion a year.

Turning to the Central banks. What are they doing? The ECB’s and BoE asset purchase programmes, which purchase some green bonds, are nothing to brag about. They are just business as usual. If anything they are biased against green bonds since so many fossil fuel issuers have high credit ratings based on their financial histories. But implementing TCFD is a useful first step.

What does an audacious supervisor look like? In China the central bank PBoC is intervening to allow green bonds to serve as collateral for medium term lending facility; there’s also discussion about using preferential risk weighting for green assets including green bonds and green loans. In India the Priority Sector Lending rules oblige banks to lend minimum volumes of money to agriculture, SMEs and renewable energy. These are out of step with OECD countries light-touch supervision, but are they really less bad than bank capital being poured into another asset bubble.

But supervisors could do even more. During the second world war the Fed was an agent for change, not a supervisor. The second world war was debt financed and the Fed purchased the equivalent to 3.2% of GDP in bonds to keep the yield low. Inflation coupled with high nominal rates of GDP growth in the 1950s allowed the then unprecedented levels of debt to erode away back down to pre-war levels.

But a properly audacious financial regulation would focus on the Tragedy of the horizon – the fact that that finance markets are still myopically rewarding yesterday’s business models. Finance should not be funding new fossil fuel infrastructure because of the halo effect of yesterday’s strong balance sheets. The market’s time myopia means the future stops mattering after 5-7 years once climate-misaligned assets are safely on some-one else’s balance sheet. We need to massively raise the cost of capital for brown assets so they are never built in the first place; and redirect this to green infrastructure. And we need to do this yesterday.

Audacious policy means large Green and brown adjustments to capital weights and bank lending targets set at a level sufficient for an orderly exit out of fossil fuels in the next decade or two. This is what many countries have signed up to, and what we need.

The Titanic had plenty of warning about the hazard it faced, if it’d had slowed down as had other nearby ships that fateful night, the momentum of its terrible coal engines might have been tamed. Spaceship Earth doesn’t have any lifeboats.

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19 June 2016 · 3:07 am

Why I finally voted leave

EU-referendum-ballot-paper-638210
I posted my “Leave” vote on Tuesday. Thanks for the tens of responses to my earlier post people sent me either by email,  posted on Facebook or on this website. All but three counselled Remain. I was, in fact, going to vote “Remain” right until Monday evening. This was a mainly through reading the anti-smoking campaigner Clive Bates’ cogent article . His basic case is: no matter how much you despise the EU (and does he despise it!), leaving it you remain exposed to its idiocies without any ability to improve it. Also the style of Brexit that Boris Johnson will adopt, should be become PM in a few months’ time, would – pandering to CBI and other powerful interests – be the Norwegian option. So Clive’s solution is to Remain and be the permanent grumpy sod that stops any further craziness taking place. Trouble is, that’s exactly what UK officials have been trying to do for five or six years, and it hasn’t worked.

And I don’t think the Norwegian option is going to fly with UK voters. I have no idea what the UK settlement with the EU will be like, should we leave. But I doubt if it’ll be like Norway’s. Like Tolstoy says: “All happy families are alike; each unhappy family is unhappy in its own way.” We have to negotiate our own divorce terms. Even if Boris personally might have no problem with uncontrolled flows of workers from other EU countries the people that voted for Brexit won’t be able to accept it. I hope the accommodation on trade in goods looks a lot like now, for  a few years. Firms in the EU and the UK will want to maintain trade links. So yes, many in the EU might want to give us a good pistol-whipping – but devising a harsh pistol-whipping takes more effort and skill the the EU Commission can realistically muster.

So what made me change back to “Leave” at the last minute? Three things:

I enjoyed reading The Labour Case for Brexit. (Incidentally if you never experienced a political vacuum then take a look at the Liberal Leave website: remarkable not in what it says, but in that it exists at all.) The Labour Case has good essays by Gisela Stuart who was involved in negotiating the Lisbon Treaty back in the day, and Bryan Gould a New Zealander and former UK politician. Stuart argues that a vote to Remain will be interpreted as endorsement of the EU’s current agenda for deeper political and diplomatic union and that a remain vote is actually a vote for a much expanded role of the EU. Gould argues that the EU through focussing so much at the internal market, has neglected outside commercial opportunities – a dumb tactic given the Asiatic shift of the world economy. There’s also an interesting article by Roger Godsiff about how the rules on workers’ rights in the UK and how with the exception of rights for part-time workers all were initiated in the UK before the EU, or there is no EU requirement for them.

Second source was the Vote Leave site. This isn’t the most edifying of resources for the undecided but there are some interesting stats on the shrinking share of the EU in terms of global GDP and its faltering efforts to conclude trade deals.

The third source was nothing to do with the Leave campaign but a depressing email I received on the Consumers International mailing list about the anti-democratic capitulation of the EU in its deals with big business. The issue is endocrine-disrupting chemicals; these substances are found in pesticides and are added to plastics to make them soft. They are linked to low sperm count, and certain cancers. There has been an agreement since 2013 to ban EDCs and the Commission was tasked with creating the list of banned substances. And then it stalled. Industry has provided a sacrificial list of “low potency” molecules it is prepared to see banned which excludes endocrine disruptors it wants to continue selling. They’ve hired fake experts to make their case. The same tactics the tobacco lobby used to halt regulation of cigarettes. The impact assessment containing the evidence is secret, even member state Governments aren’t allowed to see it. At the moment we have the unedifying site of the unelected EU Commission being taken to court by France, Sweden and the EU Parliament for failing in its duty to openly debate with stakeholders and regulate business in the public interests.

In a way this episode illustrates what’s good about Europeans, and what’s wrong with Europe. I am glad that France and the Scandinavian countries have been so active on this issue within the EU. Their behaviour shows the readiness of progressive Governments to react swiftly to challenges thrown up by science and politics. But equally it’s dismaying to see the slowness and complacency of the EU institutions in responding to the needs of its people, and the larger failure of democracy and civil society to engage with Brussels. We are not sufficiently European in our identities to be governed at the EU level. And in my opinion, until that changes, the EU should remain just a free trade area and limit its activities to setting EU wide standards.

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15 January 2015 · 3:33 pm

Arriving in Hong Kong

SheungWangPrashant in Hong Kong….for half of you this will be a “What the Hell….”moment and the other half will be wondering why it’s taken me so long to write. This is my fifth week away from the UK. I’ve been working for three weeks but more about that in a later letter.

I’m staying in a small studio apartment in Soho….the HK equivalent to London’s Soho I guess. My home, unusually for somewhere so central, is just three stories and there’s a bust of Sun Yat-Sen, the famous Chinese nationalist over my door.

It’s quite possible this is the HK equivalent of a blue plaque since tourists are constantly gawping at my room. One even peered in and asked why I lived here with my curtain open. “Was I an artist?” she asked. Do I look like Tracie Vermin?

The neighbourhood is very westernised. Nearby there’s an M&S Food store stocked with air-freighted ready meals a few doors from the Yorkshire Pudding boozer. I do mean Western rather than British. Just recently the newspapers announced the number of French people in Hong Kong exceeded the number of Brits. I think we have Sarkozy and Hollande’s mismanagement of the French economy to thank for the diaspora. Anyone who’s strolled around Hampstead Heath will understand when I say how much this makes me feel at home.

HK_SkylineHong Kong is very steep. My phone tells me I walked the equivalent of forty flights of stairs climbing up Victoria Peak. I live close to the escalator system. This consists of half a mile of linked walkways that climb from sea-level to the Mid-Levels. It’ll take you about twenty minutes to be lifted their full 135m rise. Everyday 50,000 use the system. After the escalator there’s another two kilometres of steep walking to leave the city to reach the Peak. But the views at the top are spectacular. Of course life isn’t just about views. There’s of course a shopping mall at the top including some surprisingly good value clothes shops.

VictoriaPeakBSideBut the most surreal thing after the climb is the other side. You hit the wilderness of Pok Fu Lam country park. This isn’t country park meaning a designation of land that allows rich squires to protect their views and maintain the sanctity of their golf courses. [Though HK does have its share of golf courses and squires.] This is proper wilderness…they’d be tigers here if they hadn’t all found their way in the cooking pot. This photo was taken less than forty minutes walk from where I live. The Big Wave Bay beach scene overleaf was taken a short MTR and bus ride from my house. The beach comes complete with surfing Ozzie’s.

RepulseBayI haven’t really worked out what takes Hong Kong tick. It feels preposterously prosperous. There’s little litter, people are polite and they queue nicely for the tube even in the rush hour. And the public services work well. To give an example, like everyone else, I have to obtain a HK Identity Card from the Immigration department. The website is easy to navigate, and it takes ten minutes to fill the forms. I was offered an interview slot in the early afternoon in a conveniently located office (as opposed to Croydon’s Lunar House). I took a flask of tea and lots of reading and told my colleagues I was unlikely to make it back to the office. But I was in and out of immigration within 20 minutes. In that time they undertook two speedy interviews, scanned my finger prints and took my photo. They promised my photo ID would be ready in a fortnight – and I am sure it will. My medical check was similarly efficient.

TradeDeficitSo things work. But what do people do in this tiny 1000 square kilometre state? There’s no agricultural or extraction sector, the territory’s people are too highly paid to support manufacture too. Instead, the economy is dominated by trade and professional services and the property market. The photograph shows cranes loading piles of containers that look like lego-bricks onto lines of impatient ships. But each brick is a 40 tonne container. “Made in China” is despatched from Hong Kong.

ZeroCarbonBuildingI have never known anywhere with more estate agents than Hong Kong. No one, except for rich speculators, can afford to buy in HK – so everyone rents. Estate agents thrive in this environment of one-year leases, since they CAN help themselves to one month’s rent as commission. And of course there’s shopping. Miles of it, layers and layers of it because HK is fundamentally a 3-d city. Megabox is a 19 story building with several floors of clothes and other high value impulse purchase shops, followed by several levels of IKEA, a floor of cinema, an ice rink, then foods courts and a gym at the top. The photograph was taken from one of the Megabox’s terraces and shows the Megabox’s antithesis HK’s largest zero carbon building. This has building integrated and non-integrated PV panels, a trigen power plant to provide cool air (fuelled by biogas) when the natural ventilation and large fans are insufficient and a waste-water treatment.

Prashant (January 2015, Hong Kong)

 

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4 January 2015 · 11:20 pm

About

Hi there. This is Prashant Vaze’s website. I am interested in environmental issues, consumer affairs, economics and various geeky things like data and programming.  I  live in Hong Kong.

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