Montreal- musing of the day to day life!

Nowadays travels have become more relaxed, comfortable and all of us try and create our bucket lists of things to do, places to visit. But one of my bucket list items is to try and understand the details and issues of living in different countries and cities. At my age now there is a zero chance that I would live in any other city than Pune. I am taking this opportunity of my longish stay in Montreal to understand the local details. Everybody writes about Niagara Falls, Golden Gate Bridge and Eiffel Tower, so I thought I will jot down my observations about day to day life in Montreal.

All over the world, basic things remain the same; human nature is the same. It is the reactions to the events, dialogues that make the difference. Human emotions and conflicts will always be there. It has nothing to do with the city, state or nation. But one interesting statistic that I read about Canada says that the crime rate compared to the US is very low, which makes life safer and the cities more livable.

It seems that there is a unique donation culture in this area. The boxes shown are to put the items people want to donate. From these boxes, the needy people can take whatever items they want and whatever quantity they want. The remaining items are taken to the shop. The shop mends the items, and these are then sold in the shop as used stuff at a very reasonable price.

Road repairs are a regular activity in any city. Depending on availability, technology is used to perform the activities. On the street where we live, major pipe repair work is going on. The first thing noticeable is how the safety of people is handled. After the digging is completed, wire mesh cages are put around the dug area. For one day, the water supply had to be stopped entirely. Two days in advance, every house was handed over a letter about the same. Small flags were put (middle photo) indicating which pipelines are to be changed and which were not to be touched. There were parking restrictions from seven to seven; proper no parking boards were prepared in advance and put everywhere. Also, bright colour markers were placed on the road to indicate the presence of safety cages.

Local transport of course changes with the city to city!  Montreal Metro and Bus service have a common pass which makes it a composite service, no big deal. But what I found interesting was that to buy that pass, I had to buy a ticket called Opus. It is valid for seven years, whether you are a citizen or a casual visitor. So next time when I visit Montreal, I only need to do the top up! Modern cities are expected to have different arrangments. But what I found interesting was the availability of cycles, electric cycles and electric scooters, like the ones used by kids. These are readily available, and like rental cars, these can be taken from a place and parked where one finishes the trip. These vehicles have marked areas with cycle stands. Using an app, these can be used by everybody.

One thing I am going to enjoy is the leaves changing colours. I have seen this change in Boston, Maine and Seattle area. Though we know why and how the colours change, each region has a different kaleidoscope of colours. The leaf above is what I found today, and the blood-red colour is marvellous! It is the famous maple leaf of Canada! I will share some more pictures later when autumn sets-in!

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Many western countries have arrangements in public areas where wheel-chair access is provided. In Montreal,  I found it on each footpath at the end of the footpath, there were slopes, which allowed easy access to wheelchairs, cycles, prams, electric scooters, and so on. On each footpath, there are poles provided to tie-up your cycles.  It is no rocket science but detailing is where these arrangements succeed! We know about the sad story in Pune when such cycles were made available, recently.

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During the third week of October, there are federal elections in Canada. I remembered our election campaigns, but here I saw only small posters of the candidates hung on the poles on roads or I saw one small sticker fixed in a bus. On further checking, I was told that the campaign is mainly done on radio shows where the candidates give speeches or have debates. It is about the thought process. I remember having read an article by one of the leaders of a very aggressive party in India. He had gone to the US for the first time with a delegation. In the article, he wrote, “How do people make protests here? How do they take out processions? I could not see a single area where stones were available for pelting.”

There are of course equivalent of Deep Mini markets available for buying day to day stuff. But these are much larger though they may not be from a chain of stores. Standard facilities like trolleys and baskets were visible facilities, but they had provided entry and exit doors with motion control sensors. Doors opened with a motion sensor so that people going out with bags or a trolley found it easy. Again no rocket science! Yesterday we wanted to buy an item which we could not locate. Their employee spent 15 minutes with us and found it; it was worth only six dollars!

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Since many people don’t use cars in Montreal, I saw many of them using a trolley. You buy your stuff, fill up your trolley, and you are on the way though there was one difficulty. In certain areas in the Metro system, escalators are not provided. One has to pick up the trolley and take it up or down! I asked my daughter how does she manage this when going with her daughter. Yesterday I helped her carry on the stairs. She said that she uses it only when her husband is with her!

I feel that modern society is one where detailing is done for the comfort of people who live in the city, these need not be fancy or elaborate. These are to create ease in our day to day chores, like buying, throwing garbage, managing road repairs! It has its humane angles where poor and needy are also looked after, and there is a system for that. I saw a young Gora beggar who looked fit, was about 30 but these things probably remain the same world over. Why this would happen in the advanced world is a surprise. Those who want to work can get a job in these cities; they have almost free medical system for all citizens. We talk about the diversity of people in India and our cities. But slowly, I see similar diversity in many so-called western countries due to migration and refugee issues. But one thing you need to do, assimilate. My daughter is in Montreal, Quebec, since three months. Here the first language is French. Her immigration advisor told her, “Doctor, you will be dealing with the local population so you must know French well. You start work after you have mastered French.” In three months she has picked it pretty well and understand at least 80% of what is spoken when she goes out. By the way, the Montreal population is about one point eight million!  One important thing, people looking at their phones on public transport is much lower about 35%!

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The world is my Oyster!

Adab and Namaste!

My nephew Atul used to go to the UK to work as a doctor. He would go for a small duration, and every time he went to a new place. The English spoken in each area was so different that he sometimes wondered if he knew English at all! It took him a couple of days to get used to the pronunciations. In today’s world when your whole family may live world over but for that we all must understand the nuiances of human behaviour. We should not be judgmental about other people’s ways, rituals, methods and their way of life in general. Those who assimilate faster where they go can then say, “The World is my Oyster”!

The nature of humans, their behaviour, their way of handling life is different. We have similar differences in India too! Like Marathi spoken in Pune, Satara, Kolhapur have their distinct flavours and dialects. Aurangabad and Nagpur have their own variants. It all depends on the culture prevalent in that area. Aurangabad was more connected to Hyderabad and Nagpur is still more attached to Madhya Pradesh though both are in Maharashtra.

I was wondering why this happens, and there are reasons. Many times, the culture depends on the construct of the language spoken in that area. English is by far the most flexible language and has absorbed many words from other languages, mainly from Indian languages. It makes the language more vibrant, and people can express what they want more clearly.

French usually give a vague answer to queries, and they may start with a reply which may seem negative. The reason for this is that the French language has 70000 words compared to 500000 words in English. So answers in English can be more precise, where French replies are vague. The first and most important NO in French is the one that means ‘je ne sais pas’ the ‘I have no idea’ NO. It is estimated that nearly 75% of the NOS encountered are to conceal a lack of knowledge. It likely comes from the terror of ridicule for being wrong. The word non in French has its roots in the French obsession for protests. “The French Revolution was about the irrevocable right of all citizens to refuse, and ‘non’ has a quality of ‘revanche des petits contre les grands’ [revenge of the underclasses] that seems to satisfy the inner peasant or proletarian in every French person, of any class.

The unique Indian gesture that often leaves visitors to the country flummoxed is the Indian nod. One thing all travellers to India talk about – apart from the dreaded Delhi Belly, of course – is the great Indian head nod. It’s not exactly a nod (up and down from the neck, meant to indicate ‘yes’) – or a shake (straight side to side to convey ‘no’). It’s a smooth movement that involves tilting the head from side to side vertically, either gently or fiercely. Does it mean a definite, yes? Is that a kind no? A maybe? A sign of uncertainty? Annoyance perhaps? It is difficult to say without knowledge of the context. It is almost always a ‘yes’, or at least indicates agreement. “There is also an element of being friendly or being respectful, and it is difficult to say which unless you know the situation.” Indians are brought up to be pliant and polite, especially to guests and to elders, and do not like to say ‘no’ directly. Indians mumble incoherently; smile sheepishly, and nod vaguely, all to put off making a firm commitment. Indeed, the head nod is a gesture meant to convey ambiguity and does so effectively.

Finnish people have different ways. Finns think if there’s no important topic to discuss, there’s no conversation at all. One of their national sayings is ‘Silence is gold, talking is silver’. But read the next surprising aspect of the Finnish people. With two million saunas in the country, which are enjoyed fully nude (generally gender-segregated, although that rule tends to be thrown out in the company of friends), the Finnish seem to have no problem with getting up close and personal. But when clothes are on, the bets are off. Probably they don’t look at each other much while wearing clothes and hence don’t recognise them!

Germans and their language have different ways of expressing things. Many new words get created by combining more than one word. Schadenfreude means pleasure derived by someone from another person’s misfortune. Schadenfreude puts together schaden (harm) and freude (pleasure) – but this is common. Compound words often can’t be directly translated into other languages, so jokes made with compound words simply won’t be funny to non-German speakers. For example, look at this joke below.

“Why can’t you pick up your watch if you’ve dropped it? Because no Urheberrecht.”

It is explained that Urheberrecht means ‘copyright’ – but German has another very similarly pronounced compound word – Uhreberrecht – which has a literal meaning of ‘watch-pickup-right’. When spoken aloud, it’s the dual implication that results in a comical effect. In English, there are no such similar-sounding words, so English speaking people simply won’t understand the joke.

The German comedian Christian Schulte-Loh explains it well. Fully aware of the stereotype the Germans are labelled with, he writes in his new book, Zum Lachen auf die Insel (To England with Laughs), that Germans are too honest to be polite and the English are too polite, to be honest.

Why people behave in a certain way? Why people react in a certain way? One thing we must realise is that people world over are the same as everywhere else. The way we feel that the actions of other people as funny, other people also feel the same way about us. It is a popular notion in India to call a stingy person, Marwari! There is a reason. The Marwari people initially lived in Rajasthan in the desert region. It was the shortage of water and everything that made people care about using all resources. Now the Marwaris live all over India, they are a monied community, but their fundamental nature of minimum wastage has not changed.

I have seen that people in the Aurangabad area have a different way of communicating. People typically say namaskar whenever they meet. But in Aurangabad, I have seen people doing Adab, and their gesture is made in the way as is done in Muslim culture. Why is this so? Aurangabad is in Maharashtra. But the reason is that till ’60 s of the last century, there was no bridge on the river Godavari at Pravara Sangam. Bus from Pune would go up to the river, people crossed the river in a boat and took another bus from there to Aurangabad. Hence Aurangabad had more connection with Hyderabad, which has Muslim culture. By the way, one interesting observation. People from Aurangabad become परेशान  when they are troubled! A word typically used there.

People travel a lot these days, in India as well as abroad. I always tell friends to keep their mind open and accept what you find different in new places. Enjoy local food at those places. Go and see local plays and dances. The more we see these new things, the more we realise that people are the same all over the world!

वसुधैव कुटुम्बकम् is the apt term in Sanskrit, meaning the whole world is a family!

India Shining Silently!

Among the political upheavals, hyperbole things are changing in India, slowly but surely. There was a political slogan, India Shining,” sometime back. But India is silently shining. The surprising part is that the change is happening on the Engineering side of life. The engineering feats are not sexy like IT, where smart men and ladies market their achievements.  

I read a couple of news items today. I found them very interesting for a different reason. One of the articles was about railways, and the other was about DRDO. 

https://indianexpress.com/article/india/indian-railways-piyush-goyal-premium-trains-rajdhani-shtabadi-5796304/ 

I will talk about the railways one first. When we speak of railways, we visualise historical systems, dirty platforms, and bogeys. In general, we get to remember inefficiency everywhere. But this article shares details about how a 20-year-old problem was resolved by Railway Engineering arm. The problem was about LHB coaches which were put into service; these were imported from Germany. There was a problem of coaches shaking, giving jolts while braking or at a higher speed. Railway team found a solution locally. There were about five thousand coaches involved. They replaced the Center Buffer Couplers with new design couplers. They also found that the usual braking method also caused these jolts. Hence they asked the drivers to use regenerative/dynamic braking system when speeds were above 30 Km/hr. With a combination of these two, jumping teacups and jolts have become history. There were 5000 such coaches, but with proper project management, the work on all of them was completed in two years. These stories don’t come out with fancy celebrations; these projects were done as part of routine practice. Great story to make everyone proud. 

https://indianexpress.com/article/india/india-israel-spike-anti-tank-missiles-drdo-5796306/ 

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The news above is another silent development of a highly complex military requirement of anti-tank missiles. Initially, the order was placed with Israel, who had a fierce competition with the US. This order was placed in 2014 for 351 launching systems and 8000 plus missiles worth US $ 500/ millions. Indian organisation DRDO (Defense Research and Development Organisation) was also in the process of developing the missiles locally. After successful second stage testing at Ahmednagar, the government decided to cancel the contract with Israel and go ahead with DRDO under Make In India initiative. These weapons are highly sophisticated and use infrared technology which has been proven during testing in hightemperature regions of Rajasthan deserts. No fanfare, the sheer hard work is the key to such success stories. Again this is the story of excellent project management where DRDO will deliver all the systems by 2021 as per requirements of the army! Kudos to DRDO. 

At the end of the second world war, Japan and Germany had lost, and many of their factories and cities were destroyed. All the treaties that were signed ensured that they would not resurrect rapidly. But somehow these nations rose literally from ashes like the Phoenix bird! All this was achieved due to the dedication, will power to excel and love for the nation.  

India, as we know today, became one nation for the first time at the time of independence. With the diversity of people, religions, languages, cultures, it was like Europe or much more complicated. Getting people together itself has been the greatest achievement of the last century, though we do not realise this. India has another significant problem. Our diverse culture has been very mature and has an old history of thousands of years. So, specific thoughts and beliefs are ingrained very firmly in our minds. We take time to change. Added to this was the large population. That India has survived and prospered is a miracle by itself.  

Slowly, we have started to learn to keep the diversity at home and now work together with professional pride as a single proud nation. Reading the above stories gives great hope to me about our great nation and people.  

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The viaduct of Pune Metro!

There are many such stories which are known to us, and we have started taking things for granted. Metro railway is an institution built singlehandedly by the doyen of this technology E Sridharan. He was also instrumental in developing the Konkan railway system. The system was one of the most stringent projects to build because of the tricky mountainous terrain. What Sridharan did was a technological marvel, management marvel. All the projects handled by him were always completed on time.

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Konkan Railway Bridge on the river Panval

My classmate Shashikant Limaye was the chief engineer for bridges on the Konkan Railway project. Shown above is the bridge designed by him on the river Panval (Yes it is supposedly near my native place Panval, where I have never been!). This bridge is 80 meters high from the ground level. It is considered a significant technical achievement in the project. How do people like Sridharan achieve such things? Looking into the smallest of the details has ensured everything works like clockwork on these projects. There is an exciting story about Sridharan. As the Metro lines started becoming operational in Delhi, he would visit different sectors every day to begin his work. Where he would go was not known to anyone. As he entered the station, he would bend and check if there was dust on staircases and escalators by wiping with his hand. What was the result of this dedication? Delhi, Jaipur, Kochi, Bangalore, Chennai, Mumbai, Nagpur, Pune, Hyderabad, Lucknow are all having Metro lines or are in the process of installation. All projects have always been completed on time.  

These projects have proven that in India, we can do worldclass technical work and have excellent project management abilities. In the example of bogeys, do not forget that these bogeys were not in one place but spread all over India. The work was completed without hampering the regular services.  

We have been doing great things in Technology. ISRO has already proven that it is India’s showcase worldclass organisation. It competes and beats others from the world in quality, performance and equally importantly, costs! 

On the business side Reliance has done a fantastic job of creating world-class large business; they have proven the same again in their Jio venture too!

But somehow we are not able to go up the value chain in other areas where we can do it. I am talking about the IT industry. They started doing well in ’90 s of the last century with Y2K! They started making big money and started getting large service contracts. Such contracts led to making even more money. In 20 years, these companies became very large, and have so much money that they did not know what to do with that money. Recently they started buying back their own shares from the market. The buyback indicated that they had no plans for developing new skills and gaining expertise in more modern areas. They have still not shown the willingness to go up the value chain. They have the people, the money but lack the will! I sincerely hope that these companies invest some money, human resources, and efforts in creating world-class products! Don’t just become Billionaires; become proud owners of great products!  

 

 

 

Tango- the Elections!

My friends Nandu suggested I share my views about the Indian elections with others. I am allergic to politics, though I have voted in every election since I became eligible to vote. Maybe I am allergic to politicians! I don’t know; I am confused. Democracy is a necessity of our lives like Roti, Kapda and Makan (Now the latest additions to the need are cell phone and internet!), i.e. Food, Clothing and Home! (For my non-Indian friends!)

Why did I give the title, Tango – the Elections! Meaning of Tango is a ballroom dance originating in Buenos Aires, characterised by marked rhythms and postures and abrupt pauses. In a democracy we expect the ruling and opposition parties to perform the Tango, sharing their views of how to run the country; but our politicians have gone for the last part of the definition, “abrupt pauses”. They take abrupt pauses, change directions, from gentlemanly behaviour switch to use of nonsensical use of language. The attacks this time have become personal, and it appears that there is no end to it! Bad words are used against very senior leaders, Chief Ministers and Prime Ministers. What direction are we taking? There was a verbal diatribe on a lady candidate, below the belt, literally! No pun intended!

When I was in school, India had become independent, and people were thrilled to be allowed to vote. Democracy continues very successfully. (Except for a hitch in 1975) India has adopted electronic voting ahead of all the countries in a big way. We don’t use ballot papers.

I read a story told by Chidanand Rajghatta, TOI US correspondent. He was called in a University to speak about modern election systems in India. At the end of his speech, he was asked to advise the Americans. He said (tongue in cheek), “Outsource elections to India”! There were huge claps all around!

The voting method is where all confusion starts. When parties win elections using the current process, they are ok with the technique. But when they lose the elections, the same method is declared as the vilest system. It gets challenged in the Supreme Court- they have promptly thrown out the petition. Parties catch hold of some engineers who are supporters of that party. These engineers make a big drama of how hacking is simple etc. To overcome such issues, sometime back Election Commission declared a date on which all the parties could come together and prove to EC, how hacking could be done. Not even one political party registered for the event. We make millions of financial, purchasing transactions electronically. Passport system in India is entirely electronic. In India, Visa on arrival is given electronically. But our politicians periodically challenge the electronic process, as an election stunt!

Another issue that is seen this time is the defection from parties. It is on the rise and shows that people are only interested in standing for elections and not working for the party. The usual sprinkling of cine stars is there, and a retired cricketer has also joined the fray.

Another significant change, to worse, is attacking the independent institutions. Decisions given by Election Commission received comments that it is working for the ruling party. Similarly, Supreme Court judgments were twisted to make claims that suit the arguments of the parties. Supreme Court took these people to the task, is a different issue, but such twisted statements waste the time of the Supreme Court.

One state that has galloped ahead of others in “reforms” is West Bengal. Many summers ago, Gopal Krishna Gokhale had said, “What Bengal thinks today, India thinks tomorrow.” Bengal is the land of Rabindra Nath Tagore, Swami Vivekanand,  Netaji Subhashchandra Bose; it is the Bhadralok (prosperous and educated people), Calcutta was India’s capital at the time of British in the initial phase. All industries started in Bengal first.

https://indiatoday.app.link/ylVjmRhPKW

The article in India Today tells us about the anarchy in Bengal. It is titled, “How to rig elections, Bengal style”! I will not go into details as the report covers what is happening today in Bengal during this election. It will suffice to say that the Election Commission acted “Suo Moto” or on its own and disallowed election campaign meetings on a day before the last day, to prevent further anarchy. The indication of such a situation was seen for many years. During the change of government last time, there were attacks and murder galore which continued all through. Shifting of Tata Nano factory to Gujarat was the clearcut signal to the powers that be! But they were too busy appeasing their electorate, and god knows who! I hope India does not start thinking like Bengal, in future!

Another first in this election is that none of the experts can predict anything. No waves are seen, no indication is seen from any patterns in voting. The voter is the ultimate God, who does not talk to anyone. As usual, the caste, religion equations are being discussed, but nobody can come to any conclusion. Most crucial conclusion every expert is saying is that an unstable government will bring chaos to India, but it appears that the opposition may not be able to form a stable government.

In large cities like Pune and Bangalore, voting % seems much lower than most other places. These two cities are cosmopolitan, and the migratory population is very high because of the easy availability of work. The community is young, and for both towns, the voting day created a long weekend. People went away on holiday. Plus transient nature did not allow people to change their voting location from their original city to the adopted city. Times of India has started a new slogan, “Let your vote travel with you”! In days of internet and computers, people should be able “to carry their vote” with them to where they are staying. Technologically it is possible, but the Election Commission needs to change its laws and people should be educated to change their thinking. This change can be connected to something straightforward and doable. For example, if you file your IT reruns from a city A, this can be shared with the Election Commission to change your place of voting. It is just a way it can be done, but it is doable.

What can be done about the criminal records of candidates? Our laws need to tighten further. Another observation is that many candidates become very rich in between two elections. Most of these people never go to the office like you and me; they are not known to have businesses, but where does the wealth come from?

I have discussed mainly systems in Indian elections. One more thing that needs to be tackled is why not hold national as well as state elections at the same time. It will save a lot of costs. Last national election cost Rs.3800/ crores i.e. US $ 0.5/ billion, in 2014! We can assume a 20% increase in five years. If both elections are held together, there will be substantial cost savings. But somehow many political parties are against this. Probably this the cost of democracy!

All said and done, warts and all, we all should be proud of the democratic process India is following. Voting this time is done in seven rounds; these many rounds are needed to manage logistics! After all, we have states like Bengal leading the nation!

End of the road for Diesel cars!

Maruti Suzuki declared today that they would not manufacture cars with diesel engines starting from 1st April 2020! That is the day on which BS 6 norms for pollution will be implemented in India. This time the government is very stringent, and it is declared that from this date, only the cars BS 6 norms will be registered. Forget the selling; there will be no registration of cars other than BS 6! It is a great thing that the government means business, now!

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But is this the beginning of the tumultuous scenario in the automobile domain? Is it a mini tsunami? Has this statement started indicating the way things would happen in the auto industry? All these years life was much more straightforward; introduce a new model, play around a bit with the price and periodically change pollution norms when government forces you. The smooth ride was the norm! But a statement by Maruti says that the cost of development of BS 6 compliant diesel engine and the cost of making the BS 6 engine will be so high that in the small car segment, customers may not be able to afford them. Currently, the price difference between petrol and diesel model of a car is around Rs. One Lac. They feel that this difference could be Rs.2/ lacs for BS 6 cars ( ten lacs is a Million). On a vehicle costing Rs. 5 to 6 lacs, difference of two lacs will be too much, and customers may not be able to afford these cars. For cars/SUV’s costing Rs.10/ lacs and above, though the difference will be similar, % increase would not be high. How this sector will perform from next financial year needs to be watched. For SUV (both mini/standard) good news is Maruti Brezza will not be sold; hence manufacturers will rush to pick up the market share up for grabs. Maruti, however, has left the option open for 1.5 L diesel engine cars, used in Brezza.

Diesel engine cost issue due to BS 6, was expected. Volvo has already declared that they will stop making diesel cars when the norms change from Euro 6 to Euro 7, because of the cost of development and the price of the vehicle. Compared to trucks, the number of cars sold is much higher hence a smaller number of diesel cars will be better from the pollution angle.

Why did people use small cars with diesel engines? The lower price of diesel was the main reason. These cars cost approximately Rs. One lacs, plus plus, more than petrol cars. If the usage of vehicles was not enough, then owning such a car was not cost effective. On top of this, diesel engines have periodic mandatory maintenance cost which petrol cars don’t have. In many cases, it was not viable to own a diesel engine car.

With the imminent entry of Electric Vehicles in large numbers, the market is expected to be shaken further. In the late ’90s of the last century, Toyota came up with Prius, their first Hybrid car. (For those new to this subject, a hybrid car is one which runs on petrol and battery combination; each manufacturer has its own combination of the technology) It was expected that Hybrid would be the future and Toyota was expected to be the leaders. Yes, they are still the leaders in Hybrids. But a maverick called Elon Musk decided to plunge into EV’s. General Motors had manufactured around 500 EV’s at the beginning of this century, but then what happened? Petroleum lobby made sure that this initiative was killed. A few years later GM scrapped the vehicles.

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Combination of Tesla’s efforts, cheaper battery sets (hopefully!) at some stage, fast charging technology are pushing humans towards EV’s. Range per charge still remains the primary concern. Add to this reduction in the price of solar systems is making cheaper fuel for the EV, the Electricity. Now, what is adding to making it more difficult for petroleum products further, are the pollution norms for diesel cars?

What will be the future of diesel engines in the car segment? In India, the overall car segment is under pressure. In the last financial year, four lac more old cars were sold than the number of new cars that were sold. It looks like more small vehicles are being sold in II and III tier cities. Will Maruti’s prediction about diesel engine cars affect thinking by other car manufacturers? Will they also go away from diesel engine cars? Only time will tell.

The current financial year is going to be very tricky for car manufacturers. Let me explain what is involved, as the last date on which the BS IV car will be allowed to be registered. That date is 31/3/2020. To achieve this target, they will have to attempt and sell BS VI models from 1/1/2020. To meet this date, they will be required to push in BS VI vehicles from 1/10/2019. During this transition period, there will be tricky scenarios. BS IV cars will be produced less and less, but customers may want to buy them, as these will be cheaper than BS VI models. There is a possibility that in certain areas there will be customers and no cars; in other areas, there will be cars but no customers. All unsold BS IV cars will have to be sent back to manufacturers for conversion to BS VI at a considerable cost. Predicting requirement from 1/10/2019 to 31/3/2020 is going to be a nightmare for sales teams and along with them the dealers. The trend of lower sales is going to add to the difficulties further.

Will everything be hunky dory after 1/4/2020? That is again a very tough question. To achieve better fuel efficiencies and to go away from petroleum products, there will be efforts to introduce hybrid cars. But except Toyota, nobody has real expertise in this area. The predicted numbers for 2030 are 30 % EV’s, 30% Hybrids and balance IC engine cars, mostly petrol and CNG version. Does it mean that it is a death knell to diesel cars?

Another prediction by Maruti is that for small EV’s, where numbers are high in the typical small car segment, the volumes can be tricky as the price could be between 9 to 12 Lacs. This price is based on battery packs being manufacture in India. Larger cars will cost much more, but the high-price segment is less sensitive to the price tag. How the volumes will be achieved in EV’s, will be difficult to predict. I have not even discussed the charging station infrastructure issues! In India, most cars are parked on the roads for the night, so how and when will the charging be done?

At least in India, there is a significant turmoil about where the car market will go? Will Maruti continue to lead the pack? Will others follow Maruti and go away from small diesel engine cars? Only time will tell.

Right or Wrong!

A friend shared with me a document about a disputed asset usage by a well-known private organisation. As I do not like to go into political disputes and discussions, I am sharing my general thoughts on the subject. I am not talking about what happens the world over, but I will restrict the discussion under Indian scenario. I will not be specific about names and projects for obvious reasons.  

Air, Sunlight and Water are three primary natural resources. Air and Sunlight are unlimited, but potable water is not! Water may be abundant in the sea, but fresh water is not unlimited. The availability of potable water in the right places at the right time is also critical. That is going to be essential in future. Any new asset creation is controlled by availibility round the year. Like in Rajasthan, the government is putting Sunlight to good use by putting up a large number of Solar plants. In various areas in different states, wind energy is harnessed by putting up windmills for power generation. The asset I am discussing is water. Government is taking up measures to catch rainwater by inexpensive methods in the state. Creating dams, diverting river water are long term projects and take huge money and a lot of time. So instead of going for complex ideas, it will make sense to achieve this by more straightforward methods.   

The specific document shared by the friend is talking about a contract this private company and the then British government. I am sure that since the project is enormous, there must have been a legal contract between the government and the company. Assume that a similar agreement is made between today’s government with a multinational. Will the deal be challenged after 100 years? The only difference would be the original contract I am talking about was with the British Government in India of those times. The hypothetical case that I have said is about the contract with sovereign government of India. Let us not forget that India as we know today, did not exist before 1947.  

When I read the document shared by my friend, thoughts about the problems discussed in the report look unimportant to me. A society, a government and hence the nation works on ethics that is followed. The document demands that the old contract made by the company with the government should be annulled. The resources used by the company should be used for the benefits of the rural poor and farmers in the different area of the state, deficient in water.  

If we take this logic further, which agreement should remain valid? There are significant beneficiaries of assets due to awards made by Shivaji Maharaj. It was the method of those times. To keep the different sardars together, they were awarded large chunks of land. Sardars would collect the taxes from the people in the area and share taxes with the Shivaji’s government. It was the way of paying sardars for the services rendered by them to Shivaji. During the last 50 to 70 years, land prices all over are shooting up. The descendants of the sardars have enjoyed the fruits of the ancestral property they had received from Shivaji. Some have become multimillionaires by selling the land, and a few have become billionaires! Should the gift that was given to these families be valid today? Was that land not owned by somebody else? Honestly, I have no issue with the old system, but it should be consistent to all, whether an individual is involved or a company is involved.  

These days there is a lot of discussion going on about poor farmers and their issues. These need to be handled with a lot of genuine care and love. Add to this the problems that come up because of market vagaries; farmers do not get reasonable rates and many a time they have to sell their products at a loss, as the product is perishable. But lest we forget, there is an equal number of poor living in the towns and cities. They live in squalid conditions and have a daily struggle to make two ends meet! When we talk of “helping” the rural poor, we should also find ways to “help” urban poor.  

What has this company done? When they took over the assets, they built dams to produce electricity. Remaining water after production was used by (and is still being used) poor people from certain area. The power helped Bombay to grow in the last century. In those days private industries did not have the money to take up such massive operations. Does the contract have an end date for the lease? Does it have an escape clause from the deal? If this contract is valid then what is the reason to ask the company to opt out of it?  

Before 1947, many things had happened for which land and other assets were taken over by the government. Indian Railway is a prime example of this. Does it mean that old owners now should be compensated for the land at today’s rates by paying the difference? Mughals in their time had given lands as an award or a reward to many. Are these contracts to be reopened? These contracts were also not made with Indian Government after 1947. Airports, Harbours were built in olden days and continue to be used after modernisation by the Indian Government. Is it only because an asset similarly is used (in the language of people against this- exploited) by private industry, it is wrong 

A valid contract between any two parties, the government or private is a contract that should continue. The demand mentioned in the document, has  asked the government to change the agreement and use the water as deemed suitable by this group of people.  

There is one valid argument. The contract was created more a hundred years back. Requirements of those times were different as there was hardly any industrialisation and urbanisation. Availability of natural resources was also different, per capita. With increased population, the reduction in per capita availability is causing stresses, and hence there can be a demand to use natural resources for a different reason. Saying this is easy but to bring such significant changes into practice will be extremely complex, and very expensive. So instead of using existing resources for a new use, invest the same money for creating the required infrastructure.  

It is said that the future wars will be about water. Is this dispute forerunner of things to come in future? I am sure good offices will prevail, and the situation will be resolved sensibly without any coercion.

What is right or wrong, only time will tell!

 

 

Startups, Venture and Angel Investors!

I am venturing into an area where even angels are afraid to tread! For a long time, I have felt lost with the terms mentioned in the title. To my understanding as an oldie, anyone starting a new business is a start-up. Investopedia definition of a startup is below:

A startup is a young company that is just beginning to develop. Startups are usually small and initially financed and operated by a handful of founders or one individual. These companies offer a product or service that is not currently being provided elsewhere in the market, or that the founders believe is being offered in an inferior manner. 

If we go by the strict definition of startups then the names like Uber, Airbnb, Zomato, Oyo and their likes come to mind. These companies have provided a service or a facility which was never offered before. These facilities became possible because of the internet and IT. I wont call Tesla a startup because they are providing a variant of an existing product; that variant is no doubt a game changer as it will change and push the Petroleum economy. But the car itself is not a game changer. 

 

Unicorn1I read a news item today which said that Delhivery a startup has become a Unicorn company. Unicorn is a mythical animal depicted from thousands of years and appears unique; maybe that is the reason this name Unicorn, a unique company. Unicorn company is defined as a company whose valuation as per markets is One billion (One thousand million) US $, i.e. Rs Seven thousand crores. As a semi-retired person nearing 70, I feel out of depth to read such figures. But for records, all my life I have run a business (a dirty secret- a software business) and had consulting assignments. In both my activities, I have dealt with companies from a couple of billion dollars to nearly 40 billion dollars. So, these numbers don’t scare me, but personally these days I go to an ATM to withdraw money for myself, I am a small man.  

Many of these Unicorn companies have been based on the internet, and IT technologies but some of them are doing the work of brick and mortar things as mere mortals do. Here is a table that I got on the net and made me start thinking. 

US $ Million  Revenue 2018 Funding   Valuation  R/F  R/V  F/V 
BYJU  219  784  4000  0.28  0.055  0.196 
Swiggy  72  1500  3300  0.048  0.022  0.455 
Zomato  47  653  2500  0.072  0.019  0.26 
PayTM  51  2200  10000  0.023  0.005  0.22 
Oyo  400  1600  5000  0.25  0.08  0.32 
Policy Bazar  62  35  1000  1.77  0.062  0.035 
Udaan  4  285  1000  0.014  0.004  0.285 
Freshworks  14.5  249  1500  0.058  0.010  0.166 
Delhivery  15  365  1500  0.041  0.010  0.243 

 I will briefly mention what they do.  

  • BYJU is in online training– revenue from students 
  • Swiggy and Zomato are restaurant food delivery companies- revenue from the restaurants whose food they pick up and deliver. Tie up with restaurants and menu details is unique 
  • PayTM is a wallet plus allied things company
  • Oyo- helps book hotel rooms and takes money from hotels– this is unique 
  • Policy Bazar- helps you buy many policies online- commission on the sale 
  • Udaan is like Flipkart and sales products online 
  • Freshworks offers sales and support solutions 
  • DelhiveryPhysically delivers goods from place A to place B and has warehousing facilities.  

To me except Oyo, Swiggy and Zomato others do not fit the strictest of the definition. Are other companies providing products and services that did not exist before? No, still they are called startups! By this definition then, like other companies, my company was also a startup and faced the same problems as these companies are facing today. The only difference is that some experts in the world thinks that they are doing something extraordinary!  

As usual, my mind started whirring, and I have questions! What is so unique in becoming a company which some experts” feel is doing fantastic work; they have invested large sums of money in them. For an oldtimer like me what matters is how much I am selling and what is the profit that I make out of the business!  Is the business sustainable over a period of time?

I will introduce two more terms now for better understanding. 

Venture capital firms are investment companies that operate only to handle investments in business ventures that may be considered high risk. 

An angel investor (also known as a business angel, informal investor, angel funder, private investor, or seed investor) is an affluent individual who provides capital for a business start-up, usually in exchange for convertible debt or ownership equity.  

Now that we are through with definitions, tables, please help me solve my queries. When the companies are creating variants of existing available services and products, how do they become startups? These companies are supposedly creating products and services which are not existing. So how do investors and angels analyse them, study them and invest considerable sums in them? Uber concept never existed, Airbnb is a new concept; so in these two cases, the investors seemed to do more right than wrong.  

I have read that more than 90% of startups fail. What could be the reason? The reasons for failures are the same as the reasons for any failed businesses. These are 

  • Lack of focus
  • Lack of motivation 
  • Too much pride and ego; that you were a smart techie does not mean that you can create and run business 
  • Taking advice from wrong people (including advisors brought in by investors) 
  • Lack of general and specific domain knowledge in life finance, operations and marketing 
  • Raising too much money too soon. 
  • Lacking good mentorship  

From what I understand about the world of business, you need experience, maturity. How will young guns have this? Recently I read some story about a 15-year-old who has done something great in creating a platform for short story writers. He has two thousand hits to his short stories! Come on, its not two million hits. I also happen to be a blogger, and I know what hits are and how difficult it is to get them.

Similarly, how can 25 years old be know all? He may be brilliant both in his techie side and convincing the investors about his ideas about which others don’t know much, anyway. How do dollars get converted into a sustainable running company? 

The table above shows all the figures in million US dollars. It shows revenue, money pumped in and valuation! The revenue is tiny when compared to the money invested. Who does the valuation? What is the significance of the appraisal? I will tell you something about valuation. How can an unproven company, with unproven management, product or services with 4/15/14 million dollars have 1.5 billion dollars valuation?  Do investors not understand these things? But since private money is involved, who cares?  Is this gambling, horse racing equivalent?

Apple was the first company whose valuation reached one trillion (I can’t count zeroes) US dollars. But once the US-China trade war started, it appeared that Apple may have problems. Immediately its valuation has come down, now Microsoft is numero uno! Apple valuation with tons of money and great products and with proven track records can come down. The companies listed in the table above are both brick and mortar companies and IT companies with nothing proven. Their valuation is going up and up and up! Any logic? 

Friends I will introduce you to more things. What people called in olden days as an investment, is now called burn rate. These companies burn money, it’s not yours anyway. Then there are serial entrepreneurs a la serial killers! They create startups, burn money (a % goes to own pockets), take the company to a level and start looking for larger companies for merger and acquisition! Someone decides and declares them more valuable. So promoters, investors, angels all make money as a new set of people replaces the old team. The show goes on. Nobody keeps track of what happens to such companies. Since bank funds and financial institution money is not involved nobody cares. No Nirav Modis and Mallyas are created. Start next company and go through the same cycle, make a million or two. The cycle goes on.

The end result of all this is that “Startup Culture starts in your country. The startup language is a new language which most don’t understand and I am sure you have still a lot of questions on the subject discussed, even after you have read this piece!