Nihal Sarawgi

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On December 1, 2017, Nihal Sarawgi commented on Maersk’s Shipping Lane in the Fight Against Global Warming :

Interesting article!

One thing I found shocking was the research published on how strong is lobbying of the shipping industry executives on climate change policies. The IMO environmental committee had 31% of nations which were represented in part by direct business interests, the only UN agency to allow such extensive corporate representation in the policy-making process [1].

Hence, maybe one solution is for investors to start playing a bigger role and penalizing companies that do not adhere to strict climate change standards. With the increasing allocation of capital to impact investing and the focus of several large investment firms on Environmental, Social and Governance Diligence (ESG), we can hope that market forces will ensure that the industry starts to self-regulate itself. However, this can be a painfully slow process and it is up to us, the shareholders to place higher importance on these issues while allocating capital to various fund managers.


On December 1, 2017, Nihal Sarawgi commented on Will RFID Revolutionize Retail (at last)? :

Great Article!
Absolutely agree, I think RFID can completely change the efficiency of the supply chain process and dramatically reduce inventory levels and help companies manage the SKU complexity at a significantly lower cost. What I also, found interesting however, that the potential this has to influence the in store sales experiences as well. For instance, this technology will help sales associates better assist customers and enable fitting room merchandising and promotional opportunities given SKU level level information from RFID. [1]

The challenge, however, will be managing the cost required to implement these changes. Given the near term pressure on the retail industry, I am curious to see how will companies make these investments which maintaining profits.


Super interesting application of isolationism.

What really intrigues me the history of data protectionist policies and how this has evolved and how it might continue to do so in the future. Historically, the free data exchange has enabled the internet to work seamlessly and enabled it to become a global trade route. However, in the recent past there have been several concerns on data privacy and protection (e.g. Snowden revelations) . One of the outcomes of these growing concerns was the European Union creating a separate EU cloud which has been referred to in this article. [1]

Given data is power, the two critical questions that needs to answered not just for Microsoft but all global corporations:
1. Who owns the data (creators or platforms) and how will regulations be defined in this regard?
2. How will data flow continue to remain fluid but at the same time respect the privacy and ownership of the data owners

Personally, I think free flowing data is critical for businesses to continue to operate effectively. Law and security measures need to be developed that ensure data owners are adequately protected and compensated.


On November 30, 2017, Nihal Sarawgi commented on Globalization with Apple :

Very interesting topic!

There were two things that came to my mind as to how apple can combat wage inflation.
1. Automation: How much will Apple invest in automation and work with their suppliers to reduce dependency on labor, especially eliminating the low to medium skill jobs. However, this is not easy and will take time.
2. Diversification of supplier base: Given the need to expand the manufacturing footprint and move to cheaper locations, India is a potential destination for apple with one of the solutions being to manufacture the older iPhones in Bangalore [1]. Yet, developing new suppliers and maintaining quality and scale in India is a whole new challenge.

However, on the isolationist policy and moving manufacturing back to US, Apple could potentially move manufacturing of some of the low volume high complexity items to US, employing few workers as a show of good faith. But with regards to scale and cost, I am unable to see how they would ever be able to manufacture a large portion of their demand in the US.


Interesting Article!

One of the biggest challenges that has plagued the Indian banking system in recent times is the rise of Non-performing Assets (or NPAs) [1]. NPAs rise due to the process called evergreening where banks provide propping up ailing companies with fresh loans, even as firms struggled to repay old debts.

One area that will be particularly crucial is how Axis banks, and others, use digitization and increased data availability to reduce the risk of NPAs. One potential solution could be increased transparency and increased data sharing between the bank and the firm it is lending to. Banks need to keep a tab on an enterprise’s key financial transactions, resources and commitments. Having a digital system in place could be used to identify potential defaulters way in advance and on the flip side, actually provide lower interest rate loans more financially healthy enterprises. [2]


On November 30, 2017, Nihal Sarawgi commented on Climate Change will change the way we farm and eat! :

Very interesting article!

Based on the article, I noticed 2 ways of reducing GHG emissions for Cargill
1. Reduce usage and wastage across the supply chain (renewables, less water consumption etc.)
2. Educate farmers in using more energy efficient procurement techniques

However, one area which I additionally noticed is the mix of their agriculture vs poultry business. Based on an article in the guardian citing research conducted by Oxford Martin School [1], a vegan diet could be unto 63% more energy efficient vs a meat-based diet. Hence, I wonder if Cargill is focused on expanding their agriculture business rather than its poultry business and whether they are placing any dollars into vegetarian awareness campaigns.