Global Themes

On Globalization & Venture Capital

Of, India, China, Apples and Oranges

My friend Ashutosh Sheshabalaya recently wrote a piece in which he underlined the important differences between India and China when it comes to approaches towards global warming and sustainable development.

In the piece he pointed out the intellectual laziness (and the mistake) of lumping India & China together in any debate about global warming and who bears responsibility for what. It is a brilliant read and one I highly recommend.

Some excerpts: EYE ON THE TIGERS  (by Ashutosh Sheshabalaya)

They are omnipresent, even if they lie shrouded backstage in discussions about climate change. At last count, there were almost two-and-a-half billion of them – Chinese and Indians.

Indeed, one of the most sterile facets of the global warming debate is to refer to China and India, rather than to Chinese and Indians. China and India may be among the world’s biggest CO2 emitters. But your everyday Wang or Rajiv hardly qualifies for such an honour. 

The reasons are clear: out of the world’s 235-plus countries, China and India’s populations outnumber the bottom 220 put together.  And their per-head/per-body contribution to global warming is vastly lower than that of the West.

In the typical Indian’s case  – commercial energy use is, crucially, also far below the global average.  In 2005, world electricity consumption was 2,400 kilowatt hours (kWh) per person. India’s was just 432 kWh, four times less than China’s 1,662 kWh.  Oil use, too, exemplifies such trends.

An Indian’s consumption of crude, at 0.8 barrels per year, pales against the world’s 4.5 barrels, and is less than half China’s 1.8. There is little point throwing more dazzling, vulgar beams of light by juxtaposing such figures against the Western world, lit up end-to-end for the Christmas and New Year festivities.

Still, what is clear is that the difference between India and China is at least as significant as that between China and the world. And here is a suggestion to move the climate change debate beyond noisy palavers (a word originally referring to the patronising monologues of European colonial adventurers in Africa).

Firstly, differentiate between India and China. Both may be rising industrial powers, but China’s economic growth-at-any-cost is rather different from that of India, and this difference goes far beyond the numbers referred to above.
Although similarly determined to remove poverty, democratic India also boasts deeply ingrained soft systems which have begun priming its voters for the trade-offs between economic growth and their longer-term costs. 

It was India – not China, or the West – which established the first Ministry for Renewable Energy. That was in the early 1990s. Since then, India’s Supreme Court – widely considered among the world’s most activist judiciaries – has set the country’s green agenda, from forcing metalworking and chemical plant closures to driving one of the world’s most ambitious environmental projects to date, namely the conversion of the New Delhi public transportation system to compressed natural gas. There are hundreds of other such examples.

The rest of the Indian system, too, has responded, at least as far as possible in what remains one of the world’s poorest countries.  Rural India now hosts 30 million high-efficiency ‘smokeless’ stoves, with a conversion efficiency four times higher than their predecessors. Indian biomass gasifiers – a key renewable energy technology – are exported across the world, even to squeaky-clean Switzerland. More broadly, even modern, industrialising India has chipped in. The country’s energy intensity has fallen from 0.3 kgs of oil equivalent per dollar GDP in 1972 to 0.19 kgs in 2003 – equal to Germany.

Against this, the near-comprehensive lack of awareness about such efforts outside India remains striking. So too does the innate assumption that clean air and climate change are concerns of enlightened shock troops from the West battling recalcitrant polluters in ChIndia’s wastelands. On November 23, without a by-your-leave, the New York Times announced that the US was “the world’s third largest wind (producing) country, after Germany and Spain.”

It also cited the Chief Executive of the European Wind Energy Association about a ‘second wave’ of “new countries with significant wind capacity” – among them, “Britain, Canada, Italy, Japan and the Netherlands. “ No numbers anywhere, nor a single mention of India. As it happens, figures from the Global Wind Energy Council show India in fourth position, with 7,093 MW of installed windpower capacity in July 2007, three times that of Britain, Canada, Italy or Japan, and double  that of China.

This is not to say that continuing industrialisation in India will not add to the world’s environmental woes. But pretending that India, and the 800 million Indians below the Davos line are doing nothing about it robs the debate of seriousness, and provides little incentive for meaningful cooperation with the West.

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Read more from Tosh here:

Of Googlies*, Cricket, India and China 

“The 3 Rounds of Globalization” 

The Gospel according to Goldman Sachs 

and finally, a related post: Globalizing Consumption, American Style… 

January 15th, 2008 Posted by | Asia & The World, China, Development Issues, India | 2 comments

Al Gore’s Inconvenient Un-Truth(s)

Some of you may have already picked this.

In an embarrassingly timed judgement (just a day before he won the Nobel Prize), Mr Justice Burton (UK) “identified nine significant errors” in Al Gore’s “An Inconvenient Truth” and reportedly said that “the “apocalyptic vision” presented in the film was politically partisan and not an impartial analysis of the science of climate change.”

The Judge ruled that the film can be shown in UK classrooms but only if teachers added a disclaimed saying the film’s facts are disputed.

The Times identified the “nine mistakes” as below:

The first mistake made by Mr Gore, said Mr Justice Burton in his written judgment, was in talking about the potential devastation wrought by a rise in sea levels caused by the melting of ice caps.

The claim that sea levels could rise by 20ft “in the near future” was dismissed as “distinctly alarmist”. Such a rise would take place “only after, and over, millennia”.

Mr Justice Burton added: “The ar-mageddon scenario he predicts, inso-far as it suggests that sea level rises of seven metres might occur in the immediate future, is not in line with the scientific consensus.”

A claim that atolls in the Pacific had already been evacuated was supported by “no evidence”, while to suggest that two graphs showing carbon dioxide levels and temperatures over the last 650,000 years were an “exact fit” overstated the case.

Mr Gore’s suggestion that the Gulf Stream, that warms up the Atlantic ocean, would shut down was contradicted by the International Panel on Climate Change’s assessment that it was “very unlikely” to happen.

The drying of Lake Chad, the loss of Mount Kilimanjaro’s snows and Hurricane Katrina were all blamed by Mr Gore on climate change but the judge said the scientific community had been unable to find evidence to prove there was a direct link.

The drying of Lake Chad, the judge said, was “far more likely to result from other factors, such as population increase and overgrazing, and regional climate variability”. The melting of snow on Mt Kilimanjaro was “mainly attributable to human-induced climate change”.

The judge also said there was no proof to support a claim that polar bears were drowning while searching for icy habitats melted by global warming. The only drowned polar bears the court was aware of were four that died following a storm.

Similarly, the judge took issue with the former Vice-President of the United States for attributing coral bleaching to climate change. Separating the direct impacts of climate change and other factors was difficult, the judgment concluded.

Related Post: Help, I’m feeling cold… 

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October 12th, 2007 Posted by | Development Issues, Energy and Environment | one comment

What counts as innovation?

A few days ago I met Matthew Scott for lunch.  Matthew told me the story of “Mighty Light“.

MightyLight aims to bring “light” (literally) into the lives of millions who live in remote parts of the world and don’t stand a chance to get grid connectivity. It aims to do so by a clever product that is solar-charged and uses energy efficient white LED for lighting.

It got me thinking on how innovation in distribution channels is probably as critical as innovative product design in the context of domestic consumers in emerging markets (and particularly so in the case of BOP consumers…)

Now, if you are a purist – this may not count as true innovation.

Distribution channels (or even innovation in distribution channels) is not something that you can patent…and yet there is no doubt that products like these are capable of transforming the lives of millions through clever combination of technology and distribution which hitherto was not possible. 

In other words, they fit the criteria of high-impact and definition of a “breakthrough product” – and possibly innovation.

What do you think?

On a related note, I also spoke with Alok Singh, CEO of Novatium a few days ago – they too are doing something that is fairly unusual and exploting a business model around services that has not been tried in the PC industry before . Will it work? We dont know yet.

Is it an innovative approach? I certainly think it is.

Related Post: Has the $100 PC finally arrived?

October 1st, 2007 Posted by | Development Issues, Entrepreneurship, India, Tech & Innovation in Asia, Technology & Innovation | 6 comments

Finding hidden gems…

Nandini Lakshman has written a nice article in BusinessWeek on how VCs in India are broadening their scope and looking at non-obvious opportunities: “India Rides the VC Wave

Some excerpts:

“The fishermen from the Indian village of Chidambaram live a hard life. They sleep most of the day, then spend the night out on the water. For light during those dark hours, they have long depended on wobbly kerosene lamps that were easily blown out or, worse, toppled by the wind, risking deadly fires on their boats.

But these days, the kerosene lamps have been replaced with MightyLights, $50 solar-powered fixtures. “I save 100 rupees [$2.50] a month on kerosene alone,” says K Kanimuri, a fisherman’s wife, who also uses the MightyLight in her makeshift kitchen. With her savings, she now makes and sells candles…

MightyLight is the brainchild of New Delhi-based Cosmos Ignite Innovations, a Stanford University-incubated startup by Matthew Scott and Amit Chugh that aims to provide simple products for the world’s poorest people. And Cosmos got its start with backing from Vinod Khosla, a veteran Silicon Valley venture capitalist. Now Cosmos is in talks with other groups, including London-based 3i Group (TIGRF) and eBay (EBAY) founder Pierre Omidyar, for a second round of funding. “For us, it’s not just the light, but using a sustainable model to affect social change,” says Scott, chief executive of Cosmos.

…”The base of the pyramid is often ignored, but offers a tremendous opportunity,” says Katie Hill, the India representative of Acumen Fund, an $8 million fund backed by the Cisco Systems (CSCO) Foundation and the Rockefeller Foundation. Acumen has put $1.5 million into Ziqitza, a Mumbai-based ambulance company that offers deep discounts on its service for residents of the city’s vast slums. Shafi Matther, the founder of Ziqitza, says the funds will be used to stretch the company’s ambulance fleet of two dozen vehicles to 70 in the next two years, and roll out service across India. It is already operational in the south Indian state of Kerala.

…Or take IT-rural, set up by a group of software engineers from the south Indian state of Tamil Nadu. A clutch of U.S.-based VCs are circling the startup technology venture, which develops solutions for rural India. The company doesn’t just provide a bunch of computers and conduct basic-training classes, but has a Web site to educate farmers, giving them information about crop patterns, nature of soil, crop diseases, and remedies. IT-rural also has established backward and forward linkages, from buying the seeds to branding and retailing products.”

I am hoping to meet some of these guys during one of my future visits.

July 4th, 2007 Posted by | Development Issues, Emerging Markets, India | 2 comments

Imagine…a cleaner, more connected world

Here’s how to get a cleaner, more connected world:

From a recent report in thechilli

“…Indian mobile operator Idea Cellular, Ericsson and the GSM Association’s development fund today announced…four mobile base stations powered by locally produced biofuels
…All four locations in the state of Maharashtra are greenfield sites that have not previously had access to a mobile network and are located in areas with unreliable power supply”

As the report mentions, biodiesel is not only more environmentally friendly than conventional diesel but because it is produced locally, generates employment and reduces “the need for transportation”. Biodiesel generators are also easier to maintain and have lower opex in the long run.

So not only are these generators helping extend telecommunications coverage to rural, hard to access communities, they are also helping generate local employment and minimising the environmental impact of development.

Looks like a win-win for everyone….isnt it amazing?

July 2nd, 2007 Posted by | Development Issues, India | no comments

Help, I’m feeling cold…

Even as “a group of eminent scientists” warned last week that “The Earth today stands in imminent peril …and nothing short of a planetary rescue will save it from the environmental cataclysm of dangerous climate change”  it appears thatThere IS a problem with global warming… it stopped in 1998″ !!  (- I somehow missed this article when it appeared last year).

Meanwhile, “Researchers at Duke University” have suggested that while “there is a discernible warming of the Earth’s temperature over the last century, some of which may be due to man-made CO2 emissions, but the effect is not all that clear and the data doesn’t support some of the more exaggerated estimates of global temperature increases.”

Dean has summed it up well on his blog:

“My own take is still the same as it’s been for some time: it’s pretty clear that there’s a probable warming trend, but it’s not clear that it’s catastrophic, and it’s even less clear that it should be our top priority in terms of environmental concerns. Clean water, clean air, forest preservation, and so on should be at the top of the agenda, not this. Although I’ve also long said I’ll compromise with the Greens: I’ll happily support curbing CO2 emissions if part of the deal is that they stop demonizing nuclear power and support the building of new nuclear plants throughout America. Barring that, I’ll continue my firm opposition to the Kyoto protocol and similar programs.”

I feel close to his position.

The more worrying thing though is that “Global-warming alarmists” are apparently trying to “intimidate dissenting scientists into silence“. 

See also “An experiment that hints we are wrong on climate change

To add to the confusion…and on a lighter note, read Global Warming – Part 1 and Part 2 on dilbert.blog

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Related Posts:

Why do I feel a chill when people talk of global warming? and

Is the sky really going to fall tomorrow?.

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mea culpa: This post has been written hurriedly and I have only cursorily gone through the various links posted here…I will have a more thorough look over the weekend but I don’t expect to find major deviations from what I have written here – perhaps some qualifications to the various statements but thats about it.

June 24th, 2007 Posted by | Development Issues | 2 comments

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