Welcome to Copy Time, a podcast series on Markets and Economies from D BS Group Research. I'm Tamara, be chief economist. Welcoming you to our 120th episode

Welcome to Copy Time, a podcast series on Markets and Economies from D BS Group Research. I'm Tamara, be chief economist. Welcoming you to our 120th episode

to the readers of Financial Times. Today's guest is likely to be a familiar one. Just a few years ago, Henny Sander was FTS chief correspondent for international finance and I believe that was a 13 year stint. Henny has also spent formative years with the Wall Street Journal and Far Eastern Economic Review.

to the readers of Financial Times. Today's guest is likely to be a familiar one. Just a few years ago, Henny Sander was FTS chief correspondent for international finance and I believe that was a 13 year stint. Henny has also spent formative years with the Wall Street Journal and Far Eastern Economic Review.

Uh but the journalist currier is one but in recent years, he has served as managing director at Blackrock, a senior advisor to the executive office in Asia. And presently she is the founder of New York based Consultancy, Apsara Advisory. Henny Sender. This has been a long time coming. A warm welcome to coffee time.

Uh but the journalist currier is one but in recent years, he has served as managing director at Blackrock, a senior advisor to the executive office in Asia. And presently she is the founder of New York based Consultancy, Apsara Advisory. Henny Sender. This has been a long time coming. A warm welcome to coffee time.

Thank you so much. It's great to have you. Any. You are talking to me from Hong Kong but you were in Beijing till yesterday. What vibes did you pick up?

Thank you so much. It's great to have you. Any. You are talking to me from Hong Kong but you were in Beijing till yesterday. What vibes did you pick up?

So I was only in Beijing for one day. It was a glorious spring day for those people who remember the pollution in Beijing years ago. It was a revelation to see those blue skies and I do believe

So I was only in Beijing for one day. It was a glorious spring day for those people who remember the pollution in Beijing years ago. It was a revelation to see those blue skies and I do believe

is that China is absolutely committed to reducing the pollution of its skies and its waterways, et cetera. Cherry blossoms, peach blossoms. So it was delightful to be in Beijing.

is that China is absolutely committed to reducing the pollution of its skies and its waterways, et cetera. Cherry blossoms, peach blossoms. So it was delightful to be in Beijing.

And how was the overall mood? Was it getting uplifted by the good weather?

And how was the overall mood? Was it getting uplifted by the good weather?

I believe it was. And I did not go by metro from the airport to the city which I used to do. And there are very few bicycles on the road in Beijing these days. And there are many, many electric vehicles and this is the transition in Beijing, right? And yet there is

I believe it was. And I did not go by metro from the airport to the city which I used to do. And there are very few bicycles on the road in Beijing these days. And there are many, many electric vehicles and this is the transition in Beijing, right? And yet there is

a confidence issue and you speak to people all the time and they don't feel optimistic about the future in the way they used to do years ago. And as my story better than anyone, Tamar, I had gone to India as a student, spent many years of my life in India. And the first time I went to China,

a confidence issue and you speak to people all the time and they don't feel optimistic about the future in the way they used to do years ago. And as my story better than anyone, Tamar, I had gone to India as a student, spent many years of my life in India. And the first time I went to China,

I felt that I was seeing it through Indian eyes rather than New York City eyes and the sense of confidence and pride and rightfully so and the sense that their lives were all getting better in the last several years. You don't hear that narrative anymore and the scars of COVID are still very deep.

I felt that I was seeing it through Indian eyes rather than New York City eyes and the sense of confidence and pride and rightfully so and the sense that their lives were all getting better in the last several years. You don't hear that narrative anymore and the scars of COVID are still very deep.

China is very good at not forgetting.

China is very good at not forgetting.

So when we talk about deep scars from the pandemic, but when we try to square that with data uh certainly in 2023 that scar was deep and we didn't see a confident return to travel and tourism. But let me, when we look at data from the first three months of 2024 it seems like some vigor in interregional travel, domestic tourism and so on.

So when we talk about deep scars from the pandemic, but when we try to square that with data uh certainly in 2023 that scar was deep and we didn't see a confident return to travel and tourism. But let me, when we look at data from the first three months of 2024 it seems like some vigor in interregional travel, domestic tourism and so on.

So I I hear you when you say that compared to those giddy days of strong confident China things look subdued now. But the delta, the movement on the margin, it seems to be on the upside as far as you're concerned.

So I I hear you when you say that compared to those giddy days of strong confident China things look subdued now. But the delta, the movement on the margin, it seems to be on the upside as far as you're concerned.

So it it depends when you wanna start and it is obviously confidence is very subjective. From my point of view,

So it it depends when you wanna start and it is obviously confidence is very subjective. From my point of view,

they have the same target for growth this year as they did last year. But the base is much higher in 24 than it was in 23 because the base from the previous year was so depressed by COVID. So you look at some indicators and they suggest better, but there is a certain opportunity cost

they have the same target for growth this year as they did last year. But the base is much higher in 24 than it was in 23 because the base from the previous year was so depressed by COVID. So you look at some indicators and they suggest better, but there is a certain opportunity cost

in the measures they've adopted so far

in the measures they've adopted so far

and I respect the fact that you don't want bubbles, but there's so much more they could be doing, especially on the demand side. So rightly, you say there's been too much speculation in housing,

and I respect the fact that you don't want bubbles, but there's so much more they could be doing, especially on the demand side. So rightly, you say there's been too much speculation in housing,

but sales are down 30%

but sales are down 30%

and the measures so far have been much less than they could be, especially in rental housing and affordable housing. So this government feels much more comfortable

and the measures so far have been much less than they could be, especially in rental housing and affordable housing. So this government feels much more comfortable

reform, putting reforms on the supply side. So

reform, putting reforms on the supply side. So

if I'm a household in some second tier city,

if I'm a household in some second tier city,

I may have lost a lot of money in the property market. I may have lost money

I may have lost a lot of money in the property market. I may have lost money

in the equity market.

in the equity market.

And now I'm very conservative. I leave my money in the bank,

And now I'm very conservative. I leave my money in the bank,

but

but

I can't get much return on my deposits because the government prefers to cut interest rates in the hope that that will produce more borrowing, especially from state owned enterprises. But I'm not earning anything

I can't get much return on my deposits because the government prefers to cut interest rates in the hope that that will produce more borrowing, especially from state owned enterprises. But I'm not earning anything

on my savings. And the measure so far to make me feel good about spending trading in my old electrical compli appliances isn't gonna do much for me. It seems very marginal but forgive me. But let me ask you what your analysis is as an economist.

on my savings. And the measure so far to make me feel good about spending trading in my old electrical compli appliances isn't gonna do much for me. It seems very marginal but forgive me. But let me ask you what your analysis is as an economist.

And I think you will remember a conversation that you and I had last week and my belief is among the points that you made and spot on. And I think the thing that needs to move first has to be the stock market. The property market

And I think you will remember a conversation that you and I had last week and my belief is among the points that you made and spot on. And I think the thing that needs to move first has to be the stock market. The property market

adjustment will take years. We can't wait for the property market to bottom out and that would be the lead driver of sentiment and growth. Uh There has to be excitement for entrepreneurs to build companies and brands and take them public and become wealthy. And if that can happen, even while the property market adjustment continues, I think it will be a very good offset. And this year with the likes of Xan

adjustment will take years. We can't wait for the property market to bottom out and that would be the lead driver of sentiment and growth. Uh There has to be excitement for entrepreneurs to build companies and brands and take them public and become wealthy. And if that can happen, even while the property market adjustment continues, I think it will be a very good offset. And this year with the likes of Xan

and perhaps even and financial, I don't know, there are a couple of IP OS that could be generating some degree of momentum, some degree of excitement. Um So I, I,

and perhaps even and financial, I don't know, there are a couple of IP OS that could be generating some degree of momentum, some degree of excitement. Um So I, I,

we, we compare with you about the depressed nature of domestic sentiment. Uh I do think that the policy environment is not in a state of paralysis, things are being done, maybe not to the extent that you and I would like, but it's getting done. Uh And I also think that there are probably a couple of pipeline things in the equity market that could help things on the margin.

we, we compare with you about the depressed nature of domestic sentiment. Uh I do think that the policy environment is not in a state of paralysis, things are being done, maybe not to the extent that you and I would like, but it's getting done. Uh And I also think that there are probably a couple of pipeline things in the equity market that could help things on the margin.

Um But he I I the moment I start talking about stock market, I need to, I feel like I should spill over into Hong Kong, which I don't want to do. I want to stay with China for a little longer. Um your sense of strategy. We read a lot about what the US strategy is. Republicans Democrats, there is no daylight between them. They all want to beat up on China and they want to create more restrictions on market and tech access. We know all that. What is the Chinese playbook

Um But he I I the moment I start talking about stock market, I need to, I feel like I should spill over into Hong Kong, which I don't want to do. I want to stay with China for a little longer. Um your sense of strategy. We read a lot about what the US strategy is. Republicans Democrats, there is no daylight between them. They all want to beat up on China and they want to create more restrictions on market and tech access. We know all that. What is the Chinese playbook

from the point of view of the US

from the point of view of the US

or to deal with?

or to deal with?

Right? For like China sees sort of relentless escalation of trade and tech war and strategy is possible for the Chinese to do in the in the middle of all this.

Right? For like China sees sort of relentless escalation of trade and tech war and strategy is possible for the Chinese to do in the in the middle of all this.

So it's it's very interesting because it's a return to the 1st 50 years of the PR C. In my view,

So it's it's very interesting because it's a return to the 1st 50 years of the PR C. In my view,

the Chinese narrative, the Chinese history as they see it. Post 1949 was we have to depend on ourselves all about self reliance. And I was reading a history book and there's a small footnote to that self reliance narrative,

the Chinese narrative, the Chinese history as they see it. Post 1949 was we have to depend on ourselves all about self reliance. And I was reading a history book and there's a small footnote to that self reliance narrative,

which is that for 50 years, no one in the world helped us

which is that for 50 years, no one in the world helped us

except for a nanosecond when we got aid from the former Soviet Union and they cut us off at the knees. And in fact that narrative isn't quite true when they got a ton of aid, especially from European countries. But that's the narrative they tell themselves

except for a nanosecond when we got aid from the former Soviet Union and they cut us off at the knees. And in fact that narrative isn't quite true when they got a ton of aid, especially from European countries. But that's the narrative they tell themselves

and most people don't realize. But sitting in Hong Kong, we all realized that there was a debate in China about the wisdom of joining the World Trade Organization in December of 01.

and most people don't realize. But sitting in Hong Kong, we all realized that there was a debate in China about the wisdom of joining the World Trade Organization in December of 01.

And that debate was, can we trust the world if we abandon self reliance? Will there be somebody who sells us what we need? And China is not self sufficient in either fuel or food?

And that debate was, can we trust the world if we abandon self reliance? Will there be somebody who sells us what we need? And China is not self sufficient in either fuel or food?

So will somebody sell us soybeans? Will somebody sell us corn? Will somebody sell us energy? So with these decoupling policies from the US, which you point out rightly embrace both trade and technology.

So will somebody sell us soybeans? Will somebody sell us corn? Will somebody sell us energy? So with these decoupling policies from the US, which you point out rightly embrace both trade and technology.

China's response is to say we were right not to trust the world. The US means that we have to return to our self reliance narrative

China's response is to say we were right not to trust the world. The US means that we have to return to our self reliance narrative

and we can't get semiconductors from the US anymore. We can produce above seven and that's good enough for most applications actually,

and we can't get semiconductors from the US anymore. We can produce above seven and that's good enough for most applications actually,

but we have to rely more on ourselves and it comes at costs.

but we have to rely more on ourselves and it comes at costs.

So one of the Chinese enterprises f sun or fluxing in Mandarin, who had made all kinds of arrangements to license MRN A vaccines from the West. They could never get approval, but they used locally developed vaccines which weren't as effective. And now that self reliance,

So one of the Chinese enterprises f sun or fluxing in Mandarin, who had made all kinds of arrangements to license MRN A vaccines from the West. They could never get approval, but they used locally developed vaccines which weren't as effective. And now that self reliance,

you can see it increasing in a host of technologies including biotech. But the main thing is let's rely on ourselves and their costs to it. But China is willing to pay those costs at the moment,

you can see it increasing in a host of technologies including biotech. But the main thing is let's rely on ourselves and their costs to it. But China is willing to pay those costs at the moment,

not a great answer, but in terms of self reliance, it doesn't mean an inward looking.

not a great answer, but in terms of self reliance, it doesn't mean an inward looking.

The policy as far as trade is concerned, China seems to be still very keen on doing trade. And as you and I read on a regular basis, there is this fear now in the West, that new wave of cheap Chinese manufacturing is about to flood the world from evs to batteries and so on. So how do you sort of reconcile? On one hand, look, we now become again rudely aware of the fact that we can rely on the goodwill of the rest of the world and we will

The policy as far as trade is concerned, China seems to be still very keen on doing trade. And as you and I read on a regular basis, there is this fear now in the West, that new wave of cheap Chinese manufacturing is about to flood the world from evs to batteries and so on. So how do you sort of reconcile? On one hand, look, we now become again rudely aware of the fact that we can rely on the goodwill of the rest of the world and we will

focus on self reliance. But at the same time, we believe in trade and we want the rest of the world to buy our stuff. Is there a contradiction between those two narratives.

focus on self reliance. But at the same time, we believe in trade and we want the rest of the world to buy our stuff. Is there a contradiction between those two narratives.

Um I, I don't think so because the whole point of relying on ourselves is to be less dependent, especially to make ourselves strong. And that gives us competitive edges. But we know that

Um I, I don't think so because the whole point of relying on ourselves is to be less dependent, especially to make ourselves strong. And that gives us competitive edges. But we know that

the US used to be the number one importer of goods from China and now they're in fourth place and China does rely heavily on exports. But those exports and their competitive advantages will be

the US used to be the number one importer of goods from China and now they're in fourth place and China does rely heavily on exports. But those exports and their competitive advantages will be

much more reliant on self reliance rather than imported ingredients, right? So the US and China knows now that

much more reliant on self reliance rather than imported ingredients, right? So the US and China knows now that

the old formulas of exporting have to change. So I for example, India has a very complicated and tense relationship with China. I went to see a renewables project in India. It had 2.8 million solar panels. I said to the founder of this company, where are these solar panels imported from? And he said Malaysia,

the old formulas of exporting have to change. So I for example, India has a very complicated and tense relationship with China. I went to see a renewables project in India. It had 2.8 million solar panels. I said to the founder of this company, where are these solar panels imported from? And he said Malaysia,

Malaysia means

Malaysia means

a Chinese subsidiary operating in Malaysia. So you see Chinese setting up to export to the West but indirectly through a Malaysia, given the inflation reduction act in the US which many people in Singapore and Korea

a Chinese subsidiary operating in Malaysia. So you see Chinese setting up to export to the West but indirectly through a Malaysia, given the inflation reduction act in the US which many people in Singapore and Korea

and many other Asian countries feel like is American first protectionism. The combination of NAFTA and IRA means a lot of Chinese investment is going to Mexico. So they rely on exports as a source of growth. But to make them the competitive advantage that they are seeking, they rely on themselves. So that's how I I look at it.

and many other Asian countries feel like is American first protectionism. The combination of NAFTA and IRA means a lot of Chinese investment is going to Mexico. So they rely on exports as a source of growth. But to make them the competitive advantage that they are seeking, they rely on themselves. So that's how I I look at it.

Yeah, I think I think that's pragmatic and I think there is a limit of how many trade rules you can come up with to prevent Chinese subsidiaries in Mexico and Malaysia to stop trading with you. Uh It, it, it would be uh let's put it this, I was about to say it would be nearly impossible but if there is a Trump two point or who knows, maybe even that would be something on the cards. Um

Yeah, I think I think that's pragmatic and I think there is a limit of how many trade rules you can come up with to prevent Chinese subsidiaries in Mexico and Malaysia to stop trading with you. Uh It, it, it would be uh let's put it this, I was about to say it would be nearly impossible but if there is a Trump two point or who knows, maybe even that would be something on the cards. Um

Any earlier, you talked about this issue related to um chips, you didn't say the word chip, but you said seven. So I know that you were talking about seven nanometer chips and below that. Uh but so let's just talk about that for a second. I had Chris Miller who wrote that excellent book on Chip War a couple of years ago on my podcast last year. And Chris seemed to think that

Any earlier, you talked about this issue related to um chips, you didn't say the word chip, but you said seven. So I know that you were talking about seven nanometer chips and below that. Uh but so let's just talk about that for a second. I had Chris Miller who wrote that excellent book on Chip War a couple of years ago on my podcast last year. And Chris seemed to think that

this, this goal to widen the tech gap between the US and China is a pretty pressing concern for the White House and Washington. And therefore they would lean on

this, this goal to widen the tech gap between the US and China is a pretty pressing concern for the White House and Washington. And therefore they would lean on

uh lithography companies in Holland or materials companies in Germany to not trade with China and prevent China from

uh lithography companies in Holland or materials companies in Germany to not trade with China and prevent China from

going any further? Um How existential is this? Uh could it sort of render Chinese military substantially vulnerable to us? Military tech? Would it put a cap on China's tech progress? If they can access faster chips,

going any further? Um How existential is this? Uh could it sort of render Chinese military substantially vulnerable to us? Military tech? Would it put a cap on China's tech progress? If they can access faster chips,

it certainly will slow down the move up the value added chain that is undoubted thought your podcast with him was brilliant and the book is brilliant and he described semiconductors as the ultimate globalized industry

it certainly will slow down the move up the value added chain that is undoubted thought your podcast with him was brilliant and the book is brilliant and he described semiconductors as the ultimate globalized industry

because it's a series of technologies actually and you source different parts of that value chain from different companies in different countries, right? So the whole effort is to slow down that effort.

because it's a series of technologies actually and you source different parts of that value chain from different companies in different countries, right? So the whole effort is to slow down that effort.

And when I sit down with the most brilliant venture capitalists in China, and I go through every technology is the gap widening or narrowing. And before COVID and this more intensified technological decoupling,

And when I sit down with the most brilliant venture capitalists in China, and I go through every technology is the gap widening or narrowing. And before COVID and this more intensified technological decoupling,

I really overestimated the speed at which China would close the gap in some technologies. There are technologies where China is moving up very quickly and becoming leading edge and those include aerospace,

I really overestimated the speed at which China would close the gap in some technologies. There are technologies where China is moving up very quickly and becoming leading edge and those include aerospace,

robotics

robotics

and a number of other technologies embracing the whole renewables efforts, electric vehicles, batteries, solar, that whole constellation and there are others where the gap is widening

and a number of other technologies embracing the whole renewables efforts, electric vehicles, batteries, solar, that whole constellation and there are others where the gap is widening

and I would include biotech there which is rather surprising

and I would include biotech there which is rather surprising

and semiconductors. Everyone was surprised by the latest Huawei chips. And it's interesting because there's so much human capital exchange between TS MC and SM IC in Shanghai. And yet

and semiconductors. Everyone was surprised by the latest Huawei chips. And it's interesting because there's so much human capital exchange between TS MC and SM IC in Shanghai. And yet

China is behind and desperately trying to catch up in, in that, right. So you have to look at it in a more granular way,

China is behind and desperately trying to catch up in, in that, right. So you have to look at it in a more granular way,

right? I I fully agree and in terms of frontier technology, there are things to do beyond the next fastest chip in the sense that when we look at peer reviewed journals in solid state physics or biotechnology. Chinese scientists are publishing

right? I I fully agree and in terms of frontier technology, there are things to do beyond the next fastest chip in the sense that when we look at peer reviewed journals in solid state physics or biotechnology. Chinese scientists are publishing

uh and and getting published in top journals around the world. So it seems like there are certain foundational technologies where the hard work is bearing fruit. But in terms of commercializing the leading edge of semiconductor, I think that's one gap, China is certainly going to feel more and more in the coming years. Uh He, you're talking to me from a hotel room in Hong Kong, a city where you have lived for a long time. And even now, although you're based in New York, you spend a lot of time in Hong Kong.

uh and and getting published in top journals around the world. So it seems like there are certain foundational technologies where the hard work is bearing fruit. But in terms of commercializing the leading edge of semiconductor, I think that's one gap, China is certainly going to feel more and more in the coming years. Uh He, you're talking to me from a hotel room in Hong Kong, a city where you have lived for a long time. And even now, although you're based in New York, you spend a lot of time in Hong Kong.

Um It's been a depressing few years for the city state. Uh where do things stand now?

Um It's been a depressing few years for the city state. Uh where do things stand now?

It it continues to be very depressing.

It it continues to be very depressing.

I don't think that you can entirely put the blame on Beijing. I think the quality of the government and the policies that would help put the life back into Hong Kong are totally lacking. Many more people left

I don't think that you can entirely put the blame on Beijing. I think the quality of the government and the policies that would help put the life back into Hong Kong are totally lacking. Many more people left

Hong Kong then came to Hong Kong over the long weekend that we just had.

Hong Kong then came to Hong Kong over the long weekend that we just had.

So Hong Kong

So Hong Kong

is a series of monopolies to me when I fly from New York to Hong Kong, Cathay Pacific has a monopoly. There's no other airline that flies nonstop. The fares they charge have become a competitive disadvantage for Hong Kong.

is a series of monopolies to me when I fly from New York to Hong Kong, Cathay Pacific has a monopoly. There's no other airline that flies nonstop. The fares they charge have become a competitive disadvantage for Hong Kong.

When I go to Singapore. I'm amazed at how much higher the quality of life is in Singapore than in Hong Kong if you define like me the quality of life as walking in a park and breathing clean air by not living in Hong Kong. I'm saving so much money because the supply of affordable housing is kept artificially low.

When I go to Singapore. I'm amazed at how much higher the quality of life is in Singapore than in Hong Kong if you define like me the quality of life as walking in a park and breathing clean air by not living in Hong Kong. I'm saving so much money because the supply of affordable housing is kept artificially low.

If you can build an airport on landfill, you can build housing on landfill. When they moved the airport to one of the outer islands. They were supposed to redevelop the former airport land in Kowloon into affordable housing. They haven't done that. There's so many things Hong Kong could do to improve the quality of life of its people and they haven't done that.

If you can build an airport on landfill, you can build housing on landfill. When they moved the airport to one of the outer islands. They were supposed to redevelop the former airport land in Kowloon into affordable housing. They haven't done that. There's so many things Hong Kong could do to improve the quality of life of its people and they haven't done that.

It, it's very sad to me.

It, it's very sad to me.

Uh aren't there some projects in place toward affordable housing capacity expansion?

Uh aren't there some projects in place toward affordable housing capacity expansion?

They are so limited and actually most people in Hong Kong, there was an article written in my former employer paper by the former head of Morgan Stanley in Asia saying Hong Kong is done and what he meant was more than Hong Kong is done as an international financial center. Most people in Hong Kong

They are so limited and actually most people in Hong Kong, there was an article written in my former employer paper by the former head of Morgan Stanley in Asia saying Hong Kong is done and what he meant was more than Hong Kong is done as an international financial center. Most people in Hong Kong

don't have a sense that their life was improved by having Hong Kong be an international financial center. And the government made very little effort to insulate people from say the rising cost of property in this city.

don't have a sense that their life was improved by having Hong Kong be an international financial center. And the government made very little effort to insulate people from say the rising cost of property in this city.

And to me, Hong Kong is a banking center, but Singapore is far more truly a diversified financial center.

And to me, Hong Kong is a banking center, but Singapore is far more truly a diversified financial center.

But when we talk about capital markets and I was earlier referring to certain pipeline IP OS like the ones of X. And um if they were to happen in London or New York seem to suffer from some of China fobia and chose not to host them. Wouldn't Hong Kong then be the hotbed of all these big Chinese IP OS and wouldn't that bring some vigor back?

But when we talk about capital markets and I was earlier referring to certain pipeline IP OS like the ones of X. And um if they were to happen in London or New York seem to suffer from some of China fobia and chose not to host them. Wouldn't Hong Kong then be the hotbed of all these big Chinese IP OS and wouldn't that bring some vigor back?

I mean, if Hong Kong was to provide liquidity, liquidity to these private companies trying to go public, it would be huge for Hong Kong and it makes a lot of sense and yet they're all caught. So the the actual advantage that Hong Kong has always had is that our stock market is so vibrant. But

I mean, if Hong Kong was to provide liquidity, liquidity to these private companies trying to go public, it would be huge for Hong Kong and it makes a lot of sense and yet they're all caught. So the the actual advantage that Hong Kong has always had is that our stock market is so vibrant. But

we don't see I was talking recently to somebody who runs credit hedge fund and if a Chinese company is listed in Hong Kong, they're comfortable that Hong Kong has done a good job scrutinizing them and there won't be frauds, it is a competitive advantage but it is being caught in decoupling and it's getting harder

we don't see I was talking recently to somebody who runs credit hedge fund and if a Chinese company is listed in Hong Kong, they're comfortable that Hong Kong has done a good job scrutinizing them and there won't be frauds, it is a competitive advantage but it is being caught in decoupling and it's getting harder

for companies based in China to get approval to list for one reason or another.

for companies based in China to get approval to list for one reason or another.

But for example, I see private sector firms going to places like Jakarta and saying when you list, normally you will list in Jakarta, you will not list in Singapore but why not consider Hong Kong?

But for example, I see private sector firms going to places like Jakarta and saying when you list, normally you will list in Jakarta, you will not list in Singapore but why not consider Hong Kong?

And slowly you see the HK MA going on road shows say to the Middle East. But

And slowly you see the HK MA going on road shows say to the Middle East. But

when the private sector tries to engage in dialogues with the government, they don't find that they have a receptive hearing.

when the private sector tries to engage in dialogues with the government, they don't find that they have a receptive hearing.

Yeah, I I can sense that frustration, time to time as well. But in addition to equity capital market where I think you and I agree there is substantial room for potential engagement. But right now, sentiments are not the greatest but the regulatory environment, the legal environment still remain a bit of a bedrock which ought to invite some additional flows in the coming years. But on the debt side

Yeah, I I can sense that frustration, time to time as well. But in addition to equity capital market where I think you and I agree there is substantial room for potential engagement. But right now, sentiments are not the greatest but the regulatory environment, the legal environment still remain a bit of a bedrock which ought to invite some additional flows in the coming years. But on the debt side

and I just read that the dim sum market, which is Chinese entre companies issuing R and B denominated bonds and offshore hubs by that. I really mean Hong Kong that's taken on a bit of a momentum lately. There's some advantages of issuing R and B bonds and

and I just read that the dim sum market, which is Chinese entre companies issuing R and B denominated bonds and offshore hubs by that. I really mean Hong Kong that's taken on a bit of a momentum lately. There's some advantages of issuing R and B bonds and

uh Hong Kong given the low onshore interest rates. Uh so, so perhaps it's again not the greatest. I'm not trying to sco the situation. But what I tried to push back against is especially the articles like the one that you were mentioning that the game is over. It seems to me that it is premature to say the game is over because Hong Kong still has a couple of foundational aspects around its capital market which can still allow hopefully for some upsides in the future.

uh Hong Kong given the low onshore interest rates. Uh so, so perhaps it's again not the greatest. I'm not trying to sco the situation. But what I tried to push back against is especially the articles like the one that you were mentioning that the game is over. It seems to me that it is premature to say the game is over because Hong Kong still has a couple of foundational aspects around its capital market which can still allow hopefully for some upsides in the future.

I I completely agree with that. And our SFC for the first time has a local head who's amazingly capable. I don't want to overgeneralize. But o obviously the fallout in China from property market and dollar issued bonds has had

I I completely agree with that. And our SFC for the first time has a local head who's amazingly capable. I don't want to overgeneralize. But o obviously the fallout in China from property market and dollar issued bonds has had

a chilling effect, especially in a world where a more passive indexing has become more common.

a chilling effect, especially in a world where a more passive indexing has become more common.

Absolutely. Uh I I want to talk about the portfolio manager's perspective on China and Hong Kong momentarily. But one final point you were talking about earlier how during the holidays, we had actually more people leave than come in. I think we can generalize that observation to saying in the last few years, we've seen a exodus of expatriate professionals from Hong Kong.

Absolutely. Uh I I want to talk about the portfolio manager's perspective on China and Hong Kong momentarily. But one final point you were talking about earlier how during the holidays, we had actually more people leave than come in. I think we can generalize that observation to saying in the last few years, we've seen a exodus of expatriate professionals from Hong Kong.

Um But I I sometimes wonder when we talk about expats, are we only talking about Western expats? Because given the visa rules in Hong Kong,

Um But I I sometimes wonder when we talk about expats, are we only talking about Western expats? Because given the visa rules in Hong Kong,

at least, I would think that it would be a draw for professionals from ASEAN Southeast Asia, North Asia, even as long as some degree of affordability concerns are met. But from a tax and regulatory perspective, from ease of travel perspective. Um Would you say that some of this Western exodus could be replaced by regional Asian uh talent going into Hong Kong?

at least, I would think that it would be a draw for professionals from ASEAN Southeast Asia, North Asia, even as long as some degree of affordability concerns are met. But from a tax and regulatory perspective, from ease of travel perspective. Um Would you say that some of this Western exodus could be replaced by regional Asian uh talent going into Hong Kong?

Absolutely. And and especially mainland talent and Hong Kong is trying to offer incentives for say accountants, right?

Absolutely. And and especially mainland talent and Hong Kong is trying to offer incentives for say accountants, right?

And but on the other hand to me,

And but on the other hand to me,

Singapore has a much more active outreach to the best and brightest in Asia. They bring them to Singapore, they educate them and it it's a much more vibrant program. Whereas if you come to Hong Kong and you graduate from a university here, you only have a few months to find a job and then you're out of luck.

Singapore has a much more active outreach to the best and brightest in Asia. They bring them to Singapore, they educate them and it it's a much more vibrant program. Whereas if you come to Hong Kong and you graduate from a university here, you only have a few months to find a job and then you're out of luck.

I think that Singapore has done much better outreach and there are all kinds of indirect ways in which the ridiculous land prices here discourage people. So, if you look at the quality of dorms at HKU, they're horrible. But

I think that Singapore has done much better outreach and there are all kinds of indirect ways in which the ridiculous land prices here discourage people. So, if you look at the quality of dorms at HKU, they're horrible. But

it's because HKU is in the middle of the city and the land price is horrendous. So, if you're local, you don't wanna stay at home, but you can't get into a dorm. And if you're coming from outside it, it's just so much less attractive,

it's because HKU is in the middle of the city and the land price is horrendous. So, if you're local, you don't wanna stay at home, but you can't get into a dorm. And if you're coming from outside it, it's just so much less attractive,

right? I mean, look, it was down to the quality of life issue. Uh So no point, point, very well taken. Uh He uh we, we'll come back to China, India when we start talking about the perspective of global portfolio managers. But I want to complete our travel through Asia with your other favorite country. India. You're a long time India watcher and you have this ritual of visiting India and traveling through various states during the state elections, which is a pretty

right? I mean, look, it was down to the quality of life issue. Uh So no point, point, very well taken. Uh He uh we, we'll come back to China, India when we start talking about the perspective of global portfolio managers. But I want to complete our travel through Asia with your other favorite country. India. You're a long time India watcher and you have this ritual of visiting India and traveling through various states during the state elections, which is a pretty

uh colorful, vibrant, noisy journey. Uh Tell me uh I, I started this conversation by asking you what is the vibe in China. Let's start with your take on the vibe in India

uh colorful, vibrant, noisy journey. Uh Tell me uh I, I started this conversation by asking you what is the vibe in China. Let's start with your take on the vibe in India

for many years. I felt that both the country and its people had an aspiration issue. They weren't ambitious, they weren't hungry. And I think I told you about a trip we made to West Bengal

for many years. I felt that both the country and its people had an aspiration issue. They weren't ambitious, they weren't hungry. And I think I told you about a trip we made to West Bengal

and Tata Motors was planning to put a car factory in West Bengal and make an affordable car called the NANO that would retail for less than $2000

and Tata Motors was planning to put a car factory in West Bengal and make an affordable car called the NANO that would retail for less than $2000

and it would create thousands of jobs.

and it would create thousands of jobs.

And West Bengal has a history of rather dysfunctional economic policies

And West Bengal has a history of rather dysfunctional economic policies

and we're v visiting. And ultimately, Tata decided to put this car plant in Gujarat.

and we're v visiting. And ultimately, Tata decided to put this car plant in Gujarat.

And eight years after the decision not to open a plant,

And eight years after the decision not to open a plant,

I was visiting the village that would have been the locust for this plant generating 2000 jobs with my election group, which is led by a brilliant investor named Dr Shir Sharma. And I'm the only foreign journalist that generally goes on these Yatra

I was visiting the village that would have been the locust for this plant generating 2000 jobs with my election group, which is led by a brilliant investor named Dr Shir Sharma. And I'm the only foreign journalist that generally goes on these Yatra

these trips.

these trips.

And it's eight years later and the people who sold land for the factory, which the government was collecting

And it's eight years later and the people who sold land for the factory, which the government was collecting

had received the money even though the factory ultimately wasn't built. And we're talking to somebody who had refused to sell his land

had received the money even though the factory ultimately wasn't built. And we're talking to somebody who had refused to sell his land

and it was in Bengali. So there was a translator because several, most of us don't speak Bengali.

and it was in Bengali. So there was a translator because several, most of us don't speak Bengali.

And the 18 year old son of this person who refused his to sell his land was sitting outside

And the 18 year old son of this person who refused his to sell his land was sitting outside

with nothing to do.

with nothing to do.

And the father said,

And the father said,

if this land by which he meant a parcel of land, that's the size of my hotel room is good enough for my forefathers, it's good enough for me.

if this land by which he meant a parcel of land, that's the size of my hotel room is good enough for my forefathers, it's good enough for me.

It's also good enough by implication for his son who has no job, you will not find somebody in China who thinks that way, everyone wants a better life for their kids.

It's also good enough by implication for his son who has no job, you will not find somebody in China who thinks that way, everyone wants a better life for their kids.

And it was so striking to me. So that's what I mean by saying, a lack of aspiration and hunger. And now that's slowly beginning to change in India.

And it was so striking to me. So that's what I mean by saying, a lack of aspiration and hunger. And now that's slowly beginning to change in India.

My concern is the fact that the jobs that are being created in India today

My concern is the fact that the jobs that are being created in India today

are mostly

are mostly

in the digital sector and there's very few prospects for upward mobility and there's no social safety net. So if I'm a driver for the Indian equivalent of Uber or DD,

in the digital sector and there's very few prospects for upward mobility and there's no social safety net. So if I'm a driver for the Indian equivalent of Uber or DD,

I have no social safety net,

I have no social safety net,

I have no prospect of upward mobility.

I have no prospect of upward mobility.

I can work 20 hours a day. And that's still true. I'm better off being a driver for the individual who will look after me. And if my father has cancer, he will help me get medical aid for my father and he will help my Children get better educations. So my concern is that has um there's a lovely economist

I can work 20 hours a day. And that's still true. I'm better off being a driver for the individual who will look after me. And if my father has cancer, he will help me get medical aid for my father and he will help my Children get better educations. So my concern is that has um there's a lovely economist

um in,

um in,

in uh Mumbai who said to me digital India happened too soon by which he means that these service jobs are very low end and that's where the growth in jobs is. So that's my biggest concern for India and now people are aspiring to more. And how does that disappointment work out is a question mark,

in uh Mumbai who said to me digital India happened too soon by which he means that these service jobs are very low end and that's where the growth in jobs is. So that's my biggest concern for India and now people are aspiring to more. And how does that disappointment work out is a question mark,

right? Uh Very good point. Now, when we were talking about China, you commented that how striking it was to be on a blue sky clear day in Beijing. I've been going to Delhi for a long time. I'm afraid I really can't share that observation from Delhi. Um We know that the Chinese have become very serious about climate change and are doing all sorts of things from basic research to implementation of um overhaul of their infrastructure.

right? Uh Very good point. Now, when we were talking about China, you commented that how striking it was to be on a blue sky clear day in Beijing. I've been going to Delhi for a long time. I'm afraid I really can't share that observation from Delhi. Um We know that the Chinese have become very serious about climate change and are doing all sorts of things from basic research to implementation of um overhaul of their infrastructure.

Are you satisfied with the trajectory that India is taking in preparing for climate change

Are you satisfied with the trajectory that India is taking in preparing for climate change

in India needs to do much more. India is a quarter of the world's population so the world cannot meet its targets unless India does India is capital short compared to a China. So it will need to depend on external capital as well as domestic capital. But my concern is

in India needs to do much more. India is a quarter of the world's population so the world cannot meet its targets unless India does India is capital short compared to a China. So it will need to depend on external capital as well as domestic capital. But my concern is

the speed and magnitude of climate change in India when compared to the lack of resources to deal with it. So we should tell your listeners about the story that I I told you last week about extreme climate change um with especially the challenge of water, not only

the speed and magnitude of climate change in India when compared to the lack of resources to deal with it. So we should tell your listeners about the story that I I told you last week about extreme climate change um with especially the challenge of water, not only

rising temperatures which can make the plains of India unlivable in 20 years, but extreme water events. So I was talking to you about a dam that burst in the northeast with a combination of much more severe rain

rising temperatures which can make the plains of India unlivable in 20 years, but extreme water events. So I was talking to you about a dam that burst in the northeast with a combination of much more severe rain

and an earthquake in Nepal which triggered landslides in India which caused a glacial lake to flood, which then sent a wall of water into a dam and burst it with the loss of dozens of lives. Now that dam had insurance. But can a new dam get affordable insurance today? Almost impossible

and an earthquake in Nepal which triggered landslides in India which caused a glacial lake to flood, which then sent a wall of water into a dam and burst it with the loss of dozens of lives. Now that dam had insurance. But can a new dam get affordable insurance today? Almost impossible

because of the severity and frequencies of these events. So many farmers are discovering they can't afford crop insurance. So now the states have to obtain crop insurance and subsidize it for the farmers companies that are trying to build resilience against rising sea levels. These challenges are hugely expensive

because of the severity and frequencies of these events. So many farmers are discovering they can't afford crop insurance. So now the states have to obtain crop insurance and subsidize it for the farmers companies that are trying to build resilience against rising sea levels. These challenges are hugely expensive

and there's a huge challenge for resources and the

and there's a huge challenge for resources and the

the extrapolations, the dangers increase geometrically, not arithmetically. How do you li electricity demand will explode

the extrapolations, the dangers increase geometrically, not arithmetically. How do you li electricity demand will explode

with rising temperatures because you need more air conditioning, you will see many climate change refugees, right? So India is so challenged and where will the resources come from to meet those challenges? It's a huge concern,

with rising temperatures because you need more air conditioning, you will see many climate change refugees, right? So India is so challenged and where will the resources come from to meet those challenges? It's a huge concern,

right? So in a way, a lot of these climate challenges and market failures would require very strong intervention from the public sector. Uh Both in terms of, as you said, underwriting

right? So in a way, a lot of these climate challenges and market failures would require very strong intervention from the public sector. Uh Both in terms of, as you said, underwriting

insurance that the private sector won't or trying to garner FD I to build a better renewable infrastructure and so on. Um So of course, the current government has been in power for 10 years looks very likely that would get re elected to rule for another five at least. And uh has been fairly successful in galvanizing global investor sentiment.

insurance that the private sector won't or trying to garner FD I to build a better renewable infrastructure and so on. Um So of course, the current government has been in power for 10 years looks very likely that would get re elected to rule for another five at least. And uh has been fairly successful in galvanizing global investor sentiment.

Uh What's your sense uh from outside looking in? Um large companies are finding India an attractive place to put their money.

Uh What's your sense uh from outside looking in? Um large companies are finding India an attractive place to put their money.

So India historically has relied much less on manufacturing. Now it's trying to attract manufacturing.

So India historically has relied much less on manufacturing. Now it's trying to attract manufacturing.

It still lacks scale. And that's a huge challenge. China's advantage wasn't

It still lacks scale. And that's a huge challenge. China's advantage wasn't

cheap labor, it was actually scale. And I've seen so many companies in India who go from making India to assemble in India instead of going the other way around because it lacks scale. So that is a challenge today

cheap labor, it was actually scale. And I've seen so many companies in India who go from making India to assemble in India instead of going the other way around because it lacks scale. So that is a challenge today

and the government is trying to build the infrastructure that it had lacked. So when I was a student in India, I spent two months in Allahabad University which is eastern up.

and the government is trying to build the infrastructure that it had lacked. So when I was a student in India, I spent two months in Allahabad University which is eastern up.

And at the time I was a student, the trains were like 22 kilometers an hour. And until a few years ago, they were still 22 kilometers an hour. I felt like I was still 20 years old because nothing had changed. And now the government is trying to improve the infrastructure, whether it's roads or railways or airports. Right.

And at the time I was a student, the trains were like 22 kilometers an hour. And until a few years ago, they were still 22 kilometers an hour. I felt like I was still 20 years old because nothing had changed. And now the government is trying to improve the infrastructure, whether it's roads or railways or airports. Right.

And that is a critical piece as they try to attract foreign companies scale. Right.

And that is a critical piece as they try to attract foreign companies scale. Right.

Right. And uh it'll, it'll be interesting to see whether the make for India as an import substitution or make India for export, which one wins out? I think uh Rag Ram Rajan has written over the years about just the import substitution part, just reduce trade deficit by building more in India. Even if it means she is assembling. It's a good step

Right. And uh it'll, it'll be interesting to see whether the make for India as an import substitution or make India for export, which one wins out? I think uh Rag Ram Rajan has written over the years about just the import substitution part, just reduce trade deficit by building more in India. Even if it means she is assembling. It's a good step

uh and then aspire for exports. Um It, it will be interesting to see how that pans out. Uh just this morning, I was reading about uh Elon Musk uh is being quoted by India and he might be opening a Tesla manufacturing plant. Uh The way it has worked out for Tesla in China. I'm curious to see whether that's replicable in India or you would have to pursue fundamentally different model. So

uh and then aspire for exports. Um It, it will be interesting to see how that pans out. Uh just this morning, I was reading about uh Elon Musk uh is being quoted by India and he might be opening a Tesla manufacturing plant. Uh The way it has worked out for Tesla in China. I'm curious to see whether that's replicable in India or you would have to pursue fundamentally different model. So

every time we talk about

every time we talk about

up on that point, there's fierce competition opposition from local very powerful conglomerates when foreign companies want to set up in India. Because often the Indian companies do not have leading edge technology, the quality of their products

up on that point, there's fierce competition opposition from local very powerful conglomerates when foreign companies want to set up in India. Because often the Indian companies do not have leading edge technology, the quality of their products

is not competitive with the foreigners, but yet they will use their local power to try and sabotage foreign companies coming in, bringing scale and quality and higher technology.

is not competitive with the foreigners, but yet they will use their local power to try and sabotage foreign companies coming in, bringing scale and quality and higher technology.

Right?

Right?

No, no, no. It is completely related to that issue. Any China from WTO onward for the last 25 years, even if it has moved towards self reliance has been very much pro trade. Uh India has decided not to be super open, it hasn't joined the R ce F which was something that,

No, no, no. It is completely related to that issue. Any China from WTO onward for the last 25 years, even if it has moved towards self reliance has been very much pro trade. Uh India has decided not to be super open, it hasn't joined the R ce F which was something that,

that would have opened its markets to South Asia as well as China and it is sending a few FTS here and there. But by and large average tariff market access issues certainly make India much less favorable to trade than China has been over the last two or three decades.

that would have opened its markets to South Asia as well as China and it is sending a few FTS here and there. But by and large average tariff market access issues certainly make India much less favorable to trade than China has been over the last two or three decades.

Is this a deal rigor? Do you think India needs to open up a lot or is it possible to pursue its development paradigm without lowering tariffs or opening up its domestic competitors to foreign competition too much.

Is this a deal rigor? Do you think India needs to open up a lot or is it possible to pursue its development paradigm without lowering tariffs or opening up its domestic competitors to foreign competition too much.

It's a really important question. India's competitive advantage has always been in services. India feared it would just be overrun by cheap products from places like China

It's a really important question. India's competitive advantage has always been in services. India feared it would just be overrun by cheap products from places like China

which would be affordable for a country where households don't have income. I feel that India should have opened up. So when Pasco wanted to put a plant in ERISA, it would have raised the quality of steel,

which would be affordable for a country where households don't have income. I feel that India should have opened up. So when Pasco wanted to put a plant in ERISA, it would have raised the quality of steel,

upgraded, forced the whole country to upgrade Tesla. Shanghai is so much more productive than Tesla, California. Tesla is constantly sending people from Shanghai to try and improve efficiency

upgraded, forced the whole country to upgrade Tesla. Shanghai is so much more productive than Tesla, California. Tesla is constantly sending people from Shanghai to try and improve efficiency

in its operations in California. I feel that India has ill served its own population by making them dependent on the prices of local conglomerates that have much lower quality and are too expensive.

in its operations in California. I feel that India has ill served its own population by making them dependent on the prices of local conglomerates that have much lower quality and are too expensive.

So I do feel India is among the most protect protected markets and in ratings of think tanks that produce these statistics, it ranks really, really poorly.

So I do feel India is among the most protect protected markets and in ratings of think tanks that produce these statistics, it ranks really, really poorly.

That's right. Uh I I think uh I very much believe that lowering tariffs and align for more competition would be net net a very big positive for India. Um but uh seems like it's not likely in the very near term uh times have changed. He uh on the issue of global portfolio managers, you you spent a lot of time advising very large asset managers in the US.

That's right. Uh I I think uh I very much believe that lowering tariffs and align for more competition would be net net a very big positive for India. Um but uh seems like it's not likely in the very near term uh times have changed. He uh on the issue of global portfolio managers, you you spent a lot of time advising very large asset managers in the US.

Of course, we know that in the last few years,

Of course, we know that in the last few years,

financial market return from China have not been good. There has been a trend of reducing weight to allocating capital to China. Uh And at the same time, we're seeing increasing interest and increasing weight on India. So I want to frame this question from the perspective of public and private markets. Where do you see the the balance between private and public markets in terms of the attitude to India and China?

financial market return from China have not been good. There has been a trend of reducing weight to allocating capital to China. Uh And at the same time, we're seeing increasing interest and increasing weight on India. So I want to frame this question from the perspective of public and private markets. Where do you see the the balance between private and public markets in terms of the attitude to India and China?

So politically, the question is almost irrelevant when it comes to China, except for family offices. If we're talking about us investors, you cannot invest in China. It's virtually unin invests if you are even an endowment today.

So politically, the question is almost irrelevant when it comes to China, except for family offices. If we're talking about us investors, you cannot invest in China. It's virtually unin invests if you are even an endowment today.

So the only investors who can invest are wealthy individuals, family offices, that kind of thing. I think the private markets in China are very interesting today, precisely because there's so much less money going into them

So the only investors who can invest are wealthy individuals, family offices, that kind of thing. I think the private markets in China are very interesting today, precisely because there's so much less money going into them

and bank credit is available and there's so much less competition and China still has amazing world class companies. And

and bank credit is available and there's so much less competition and China still has amazing world class companies. And

if you have dollar or Renminbi funds in China, you can borrow money from Chinese banks very cheaply to invest in those companies. So your equity check is less and your debt check is much more.

if you have dollar or Renminbi funds in China, you can borrow money from Chinese banks very cheaply to invest in those companies. So your equity check is less and your debt check is much more.

And

And

interestingly, when China was growing 8% a year management wasn't critical, right?

interestingly, when China was growing 8% a year management wasn't critical, right?

But when China is slowing to five or less management is critical. So these companies, these investment companies are focused on introducing best management practice and making companies more profitable and that means their exit becomes easier.

But when China is slowing to five or less management is critical. So these companies, these investment companies are focused on introducing best management practice and making companies more profitable and that means their exit becomes easier.

And one of the sources of equity these days is state owned enterprises who wanna learn more efficient management. So I can make a case that investing in private markets in China is quite interesting, but it's only interesting to a very small pool of capital coming from outside.

And one of the sources of equity these days is state owned enterprises who wanna learn more efficient management. So I can make a case that investing in private markets in China is quite interesting, but it's only interesting to a very small pool of capital coming from outside.

And historically, your exit was to list in the west or sell to a Western strategic, which is much harder to get approval for today. It's looked on as capital flight flight. But the fact that you have local state owned enterprises who have access to as much bank borrowing as they possibly can use and need better management. It's a very interesting dynamic.

And historically, your exit was to list in the west or sell to a Western strategic, which is much harder to get approval for today. It's looked on as capital flight flight. But the fact that you have local state owned enterprises who have access to as much bank borrowing as they possibly can use and need better management. It's a very interesting dynamic.

Uh Now to India, Indian public market is on fire, the valuations are very high.

Uh Now to India, Indian public market is on fire, the valuations are very high.

And at the same time,

And at the same time,

retail investment in the public market through borrowed money and derivatives is massive.

retail investment in the public market through borrowed money and derivatives is massive.

So

So

a lot of foreigners say valuations are too high and they still are going up in India. And despite fed

a lot of foreigners say valuations are too high and they still are going up in India. And despite fed

no longer having zero interest rates and the cost of capital going up in the US, there still is a lot of liquidity in the world and a lot of liquidity coming from the US and total financial conditions are not all that tight.

no longer having zero interest rates and the cost of capital going up in the US, there still is a lot of liquidity in the world and a lot of liquidity coming from the US and total financial conditions are not all that tight.

So I think there's huge opportunity in the private markets. I've never seen as big a disconnect between private markets and public markets as in India today. And there are so many interesting start ups that raised a ton of money from big players like Softbank in 21

So I think there's huge opportunity in the private markets. I've never seen as big a disconnect between private markets and public markets as in India today. And there are so many interesting start ups that raised a ton of money from big players like Softbank in 21

and

and

now are looking at down rounds because big pools of money are out of those markets. And I think there's amazingly interesting opportunities and it's so much harder to raise money in India that you see many brilliant Indian entrepreneurs going to the west where they can raise money. And so many

now are looking at down rounds because big pools of money are out of those markets. And I think there's amazingly interesting opportunities and it's so much harder to raise money in India that you see many brilliant Indian entrepreneurs going to the west where they can raise money. And so many

of these companies have very interesting ESG SOLUTIONS. I was um

of these companies have very interesting ESG SOLUTIONS. I was um

meeting an investment firm in Singapore

meeting an investment firm in Singapore

and their investors are big multinationals who have problems with recycling waste, consumer companies that generate massive amounts of plastic waste and are looking for solutions. And this investment firm is very active in India. So for example, they had invested in a company that figures out how to separate manmade

and their investors are big multinationals who have problems with recycling waste, consumer companies that generate massive amounts of plastic waste and are looking for solutions. And this investment firm is very active in India. So for example, they had invested in a company that figures out how to separate manmade

synthetic fiber and nat natural like cotton, which makes it much easier to recycle fast fashion. So it doesn't end up in landfills. So I'm hugely optimistic about the private markets in India.

synthetic fiber and nat natural like cotton, which makes it much easier to recycle fast fashion. So it doesn't end up in landfills. So I'm hugely optimistic about the private markets in India.

How do you see it? You know,

How do you see it? You know,

fully concur? I remember reading this book by Tun Kanna at Harvard about 67 years ago and the book was called billions of entrepreneurs. And his point was that given the number of constraints that an average Indian faces on a day to day basis, it makes them very good

fully concur? I remember reading this book by Tun Kanna at Harvard about 67 years ago and the book was called billions of entrepreneurs. And his point was that given the number of constraints that an average Indian faces on a day to day basis, it makes them very good

problem solvers, which itself is a key intrinsic entrepreneurial quality. And hence India is a country of a billion entrepreneurs at that time, it was like this is the way the country can grow in spite of all the constraints. But now I think as the constraints are getting removed, it becomes a source of like a turbocharged momentum uh to, to get all these problem solvers out there and build interesting uh solutions for, as you said, environmental issues, consumer issues, the full gamut.

problem solvers, which itself is a key intrinsic entrepreneurial quality. And hence India is a country of a billion entrepreneurs at that time, it was like this is the way the country can grow in spite of all the constraints. But now I think as the constraints are getting removed, it becomes a source of like a turbocharged momentum uh to, to get all these problem solvers out there and build interesting uh solutions for, as you said, environmental issues, consumer issues, the full gamut.

Um Normally I like to end the podcast on a positive note, but today it's not gonna be it because my final question to you is about the other city where you spend your time, not just Hong Kong, but you spend most of your time actually in New York these days. Uh So state of us politics in an election year, maybe we end on that one. So tell me a little bit about that

Um Normally I like to end the podcast on a positive note, but today it's not gonna be it because my final question to you is about the other city where you spend your time, not just Hong Kong, but you spend most of your time actually in New York these days. Uh So state of us politics in an election year, maybe we end on that one. So tell me a little bit about that

when I have dinner parties and the subject comes up if at least half my guests don't leave in tears. I feel the conversation has been incredibly superficial.

when I have dinner parties and the subject comes up if at least half my guests don't leave in tears. I feel the conversation has been incredibly superficial.

I'm embarrassed to be American when I travel abroad because our presidents

I'm embarrassed to be American when I travel abroad because our presidents

have an impact on the whole world. And recently, I can't say that impact has been benign.

have an impact on the whole world. And recently, I can't say that impact has been benign.

And one of the points that I make is that the electoral college determines the outcome, it's not popular votes and it's very easy to game the electoral college and that system should have been scrapped years ago.

And one of the points that I make is that the electoral college determines the outcome, it's not popular votes and it's very easy to game the electoral college and that system should have been scrapped years ago.

And the combination of manipulating votes and gaming, the system means the outcome can be totally distorted. So that's the first point. The second point is that

And the combination of manipulating votes and gaming, the system means the outcome can be totally distorted. So that's the first point. The second point is that

these candidates,

these candidates,

you know, America has become so divided

you know, America has become so divided

and

and

it discourages the best people from even going into politics and the quality of the debate gets worse and worse. And I just don't see how you reverse