Amazon Enters Into E-Pharmacy And E-Grocery In India

Amazon Enters Into E-Pharmacy And E-Grocery In India

Amazon has ventured into e-pharmacy and e-grocery business in India. During lockdown, both these sectors saw a massive increase in demand of services, and therefore many Indian players like Swiggy, Zomato, Reliance, etc also forayed into it. Let’s dive deeper.

Crux of the Matter

Amazon Enters Into E-Pharma
Amazon launched its first E-pharmacy business in India in Bangalore and soon will expand to other cities. Customers would be able to order online prescription-based medication, basic health devices, and Ayurveda medication from certified sellers.

NetMeds, 1mg, PharmEasy, and Medlife are local players operating in the Indian E-pharmacy segment. All India Organisation of Chemists and Druggists (AIOCD), representing more than 850,000 pharmacy outlets opposed the E-pharmacy business and demanded its ban.

Why E-Pharma Seems Promising?
Driving factors are increase in internet penetration, increase in the number of smartphone owners, ease in ordering medications through an e-commerce platform and app, increase in chronic diseases, rising per capita income, and resultant healthcare spending. Moreover, during the pandemic e-pharmacy business saw a massive spike in demand.

Amazon Enters E-Grocery
During the lockdown, companies like Zomato, Swiggy, JioMart, etc. ventured into the E-grocery business. Amazon also launched E-grocery – Amazon Fresh – and E-Food – Amazon Food – businesses in India. Currently, Amazon India has more than 25 Amazon Fresh centres.

Curiopedia
  • PharmEasy is an online platform that provides medicines delivery & diagnostic tests to patients. It was founded by Dharmil Sheth, Dr. Dhaval Shah in 2015.
  • Bengal Chemicals & Pharmaceuticals Ltd. (BCPL) is India’s first pharmaceutical company. The management of the company was taken over by the Union government on 15 December 1977, and the company was nationalised on 15 December 1980. After 6 decades of losses, BCPL became profitable in the financial year 2016–17. It was founded by Prafulla Chandra Roy who is also known as the father of chemical science in India.
  • The domain ‘amazo.in’ has been bought by Flipkart. Thus, whenever you search ‘amazo.in’, you will be directed to Flipkart. Since relentless was one of the considered names for the company, ‘relentless.com’ is also bought by Amazon and will redirect you to Amazon.

What Was J&K’s Roshni Act?

What Was J&K's Roshni Act?

J&K administration has decided to scrap the Roshni Act and take back all the land allocated under the Act. It also declared names of top profile individuals and families, who misused the Act to acquire land. On the other hand, India is planning to digitize land related records to remove problems in matter of land allocation. Let’s understand Roshni Act and also see what digitization has in store for India’s land laws.

Crux of the Matter

Roshni Act
In 2001, the J&K Government implemented the Jammu and Kashmir State Land (vesting of ownership to the occupants) Act. Under this Act, the government decided to transfer the state’s land ownership to the occupants subject to payment of the cost of land, as decided by the government at market rate. 20 lakh kanals (1 kanal = 1/8 acres) land was kept aside to raise ₹25,000 crores, which would be used to fund hydroelectric power projects in the state. Thus, it was also called the Roshni Act. 1990 was the cut off year set by Farooq Abdullah’s government – the occupant must have been residing on the land before 1990.

Amendments
In 2005, the PDP-Congress Government increased the cutoff year to 2004. Later, the government of Ghulam Nabi Azad further relaxed the cutoff year to 2007. It also made free the transfer of ownership of land to agricultural farmers occupying it, with the only charge being ₹100 per kanal as a documentation fee.

From Corruption To Scrap

  • In 2009, the State Vigilance Commission filed an FIR against govt officials for allegedly conspiring to illegally possess and provide land ownership to people who did not satisfy the criteria.
  • In 2014, the Comptroller and Auditor General (CAG) found that only ₹76 crores had been realized between 2007-13 from land transfers as against the set target of ₹25,000 crores.
  • In 2015, the State Vigilance Organisation alleged over 20 government officials for misuse of the Act.
  • In 2018, the Governor of J&K Satya Pal Malik repealed the Act and ordered a CBI inquiry.
  • In 2020, the HC ruled the Act unconstitutional and said the state government said it will recover all land given under the Act. Moreover, J&K authorities also released names of several high profile families involved in corruption and misuse of the Act. Names include Haseeb Drabu & family, KK Amla & family, Shahdad family, Gagu Ram family, Nawai Subh, Khidmat trust, Farooq and Omar Abdullah, etc.

Land Digitization Reforms
Land allocation and governance in India are facing problems like internal constraints, local agitations, speculative increase in land prices, corruption, lack of transparency, etc. To remove such a problem government has launched a nationwide GIS-enabled land bank system.

It is developed by the Integration of Industrial Information System (IIS) with state GIS (Geographic Information System). E-land bank consists of a database of industrial clusters/areas across more than 3,300 industrial parks in India covering about 4,75,000 hectares of land more. It will contain information such as drainage, forest; raw material heat maps (horticulture, agricultural, mineral layers), owner’s details, etc.

How Will It Help?
For registration and other purposes, now people won’t have to visit the land Registrar’s office, reducing the scope of corruption. Clear ownership information can help avoid land disputes, and digital databases can bring transparency. With authorised intermediary, all information can be availed from anywhere in the world. Moreover, GIS technology can help estate professionals evaluate and manage a site, figure marketing strategies, etc.

Curiopedia
  • In Himachal Pradesh, only an agriculturist belonging to the State can purchase agricultural land there. People from other states require prior permission of the Government of Himachal Pradesh.
  • Common heritage of mankind is a principle of international law that holds that defined territorial areas and elements of humanity’s common heritage (cultural and natural) should be held in trust for future generations and be protected from exploitation by individual nation-states or corporations.
  • Armed Forces Special Powers Act (AFSPA) is another act implemented in Jammu and Kashmir in which the Indian Armed Forces can arrest someone and search a building to maintain public order in “disturbed areas”. It is effective in the whole of Nagaland, Assam, Manipur (excluding seven assembly constituencies of Imphal), and parts of Arunachal Pradesh too.

Good Tides for Tesla: Addition To S&P 500 Makes Tesla 2nd Richest

Good Tides for Tesla: Addition To S&P 500 Makes Tesla 2nd Richest

Tesla’s stock price rallied as the news of its addition to the US index S&P 500 came. Owing to the spike in Tesla’s stock price, Elon Musk became the world’s second richest person surpassing Bill gates. Let’s go behind the scenes and see how Tesla ‘finally’ made it to the S&P 500.

Crux of the Matter

Musk Becomes Second Richest Person
Elon Musk has become the world’s second-richest person surpassing Bill gates. According to the Bloomberg Billionaires Index, Elon Musk has added $100.3 billion to his net worth in 2020.

Billionaires’ net worth is linked to the market capitalization of their company. Generally, they are company owners holding substantial amounts of the company’s stock. Thus, if a company’s stock price increases, the owner’s wealth also increases.

Tesla’s stock price saw a surge after the announcement of its addition to the US benchmark S&P 500 came.

About S&P 500
S&P 500 is an index representing top US stocks. To enter the S&P 500, a company needs to fulfill the following criteria:
– be in the top 500 companies in terms of market cap
– book 4 consecutive profitable quarters
– get clearance from the S&P 500 committee.

Tesla fulfilled the criteria of market cap long ago but the company was not able to book profit for 4 consecutive quarters. In July 2020, Tesla met the second criteria and after posting its 5th straight profitable quarter, the committee approved its entry in S&P 500. Tesla will join the S&P 500 from December 2020.

Curiopedia
  • Elon Musk has founded companies like SpaceX, the Boring Company, Neuralink, and OpenAI. The Boring Company was born from a frustrating day sitting in traffic. In December 2016, Musk tweeted “ am going to build a tunnel boring machine and just start digging …”
  • Founded by Martin Eberhard and Marc Tarpenning, Tesla Motors’ products include electric cars, battery energy storage, solar panels, and solar roof tiles. Tesla cars accounted for 81% of the battery electric vehicles sold in the United States in the first half of 2020.
  • “Tesla stock price is too high imo,” the Tesla CEO Elon Musk tweeted on May 1, causing the company’s valuation to drop $15 billion, according to MarketWatch.

Podcasts On A Rise In India

Podcasts On A Rise In India

During Covid-19 lockdown, the number of internet users in India has seen a spike. Apart from OTT platforms and YouTube, podcasts have attracted a significant number of users. With experts forecasting that regional language podcasts will be popular than English ones, let’s take a look at this sector in India and some interesting regional language podcasts.

Crux of the Matter

Podcasts are digital audio films of books, speeches, conversations, etc. During the lockdown, the popularity of podcasts has increased across the globe as well as in India.

Given the increasing penetration of the internet in India, podcast users in India are expected to grow to ~224 million in 2024 from ~41 million in 2019.

Advertising revenue from podcasts in India is expected to grow to $95 million in 2024 from $19 million in 2019. Moreover, experts are predicting that regional language podcasts

Some Of India’s Famous Regional Language Podcasts

Pratilipi
It is a Bengaluru based startup founded in 2015 by Prashant Gupta, Rahul Ranjan, Ranjeet Singh, Sahradayi Modi, and S Devarajan. It’s an online audiobook portal featuring content in 10 Indian languages. So far it has raised $40.4 mn from investors like Nexus venture, Omidyar Network, Tencent Holding, Shunwei Capital, etc. Its subscriber base increased 4 times from 35,000 in Feb 2020 to 150,000 in Nov 2020.

Kuku FM
It is a Mumbai based regional language podcasting platform developed by Lal Chand Bisu, Vikas Goyal, and Vinod Kumar Meena in 2018. Investment of $5.5 million has been made by Investors like Vertex Ventures, Shunwei Capital, etc

Pocket FM
Bengaluru-based Pocket FM is an audiobook & podcast app developed by Rohan Nayak in 2018. More than 10K+ popular audiobooks are available on it. So far, it has raised $5.61mn from Tencent Cloud, Lightspeed India Partner, and the Times Group.

Headfone
Bengaluru-based Headfone is a social audio platform where one can record, listen, and share audios. Pratham Khandelwal and Yogesh Sharma founded it in 2017. So far it has raised $750,000 from Fosun RZ Capital and Axilor Ventures.

Curiopedia
  • Anchor is an app specifically for creating and publishing podcasts. In February 2019 Anchor was acquired by Spotify and operates as a subdivision of the streaming company.
  • A podcast is a portmanteau, a combination of “iPod” and “broadcast”. The term “podcasting” was first suggested by The Guardian columnist and BBC journalist Ben Hammersley, who invented it in early February 2004 while writing an article for The Guardian newspaper.
  • The Apple podcast stats report shows that there were 550,000 podcasts on the web in 2018. Today there are an estimated 750,000 podcasts in the world with more than 29 million podcast episodes available in more than 100 languages.

What Does China Borrowing At Negative Interest Rate Mean?

What Does China Borrowing At Negative Interest Rate Mean?

Recently, China raised ~€4 billion in total from Europe. As a part of the issue, China, for the first time issued bonds at a negative yield. In yesterday’s piece we had a look at what negative interest rates for banks and debt are. If you missed that you can read by clicking here. So what does it mean when we say China is borrowing at a negative interest rate and why is this bond issue in hot demand even if investors are getting less money in the future than they are investing today? Let’s quench your thirst.

Crux of the Matter

China Borrows At Negative Interest Rate
Recently, China raised ~€4 billion in total from Europe. As a part of the deal, it issued a bond with a negative yield (of –0.152% for a 5-year tenor) for the first time. It also issued 10-year and 15-year securities with positive yields of 0.318% and 0.664% respectively.

Bonds are ‘fixed-income’ securities issued by central banks, governments, or companies. The interest received per annum on bonds is fixed. Moreover, they are considered a safe investment option and thus there is always a demand for it among investors.

What Are Negative Yield Bond?
Yield is the return an investor receives for the investment in bonds. It includes both, interest payment and appreciation in bond value – generally bonds have positive yield.
So in negative yield bonds, an investor gets less money on maturity than the purchasing price.

In China’s issue, China is the borrower and investors are financial institutions, individuals, etc. Let’s say an investor invests €100 in China’s negative yield bond. At maturity, the investor will receive ~€99.85 (yield is -0.15%).

If investors are getting less money than they invested why are they even investing?

Reason For High Demand
You must note that China issued these bonds in (or raised money from) Europe. Due to Covid-19, bond yields in Europe and developed countries are even lower than what China is offering. Yields in developed countries and Europe are between -0.5% and -0.75% in comparison to China’s bond yield of -0.15%.

Better to receive €99.85 than €99.5 or €99.25 on an investment of €100, right?

Investors consider bonds as a safe investment instrument that prevents capital from significant erosion. As global nations continue fighting Covid-19, most of the economies are still reviving, and China is the only country to report positive GDP growth of 4.9% in the Jul-Sept 2020 period. Also, experts say investors have a positive outlook on China’s growth.

Expert’s View

There is an expectation that the new US government may impose fresh lockdowns in the economy as Covid cases are picking up in various US states and European countries, whereas China seems relatively safe now from that perspective. This is expected to lead to volatility in the financial markets in coming days, pushing up demand for safety of capital alongside flows into risk assets.

Curiopedia
  • Simple interest is a fixed percentage of the principal amount that the borrower must pay. It is fixed. Compound interest is added to the accumulated interest of previous periods, so borrowers must pay interest on interest as well as principal borrowed.
  • State Bank of India started as Bank of Bengal. This was one of the three banks founded by a presidency government along with the Bank of Bombay and the Bank of Madras. The three merged to form the Imperial Bank of India and renamed to the State Bank of India in 1955 after Independence.
  • Zero interest-rate policy (ZIRP) is a concept of a very low nominal interest rate. The United States cut the Fed Funds rate to nearly zero due to the Covid-19 pandemic and weakening economy. ZIRP is considered to be an unconventional monetary policy instrument and can be associated with slow economic growth, deflation, and deleverage.