In today's weekly wrapup, we will discuss the problem of stubble burning, the largest Iron Ore mine in the world, the definition of milk, the Lakshmi Vilas Bank saga, and a proposed work-from-home tax.
But before we get to the wrapup, a note on this week's Finshots Markets.
Airbnb is looking to potentially raise $1 billion in an IPO by the end of the year. And while we mostly do stories on the Indian markets, we thought we would switch it up this week and do a story on something more international. So hopefully, you'll enjoy this one. Link here. If you would like to listen this story on our podcast, click here.
Why Stubble Burning is such a big problem?
On Monday, we talked about one of the biggest contributors to air pollution in India- stubble burning. At the end of each harvest season , farmers pack their produce and ship it off to mandis. Usually, these are happy times. However, they do have to figure out what to do with the residue — stubble and weed from the previous crop. And they don't have a lot of time to manage it. If they don't sow the next crop within 30–45 days, they might be cursed with low yield.
Needless to say, farmers are in a mad rush to clear out their fields as soon as possible. And the quickest, most effective way to clear out the stubble is to simply burn it. But, every winter, this act turns the air in and around NCR (National Capital Region) into a dark cesspool of carbon and nitrous oxide. And this begs the question- isn't there a better way to deal with the problem? We discuss that here.
The Chinese Dream of Simandou
On Tuesday, we talked about the Simandou saga. Tucked away in the remote mountains of southeastern Guinea, Simandou hosts the world’s largest known untapped deposit of iron ore — with enough ore to sustain roughly 7% of the global iron-ore output, annually. The iron ore found in the mines held unusually high iron content, prompting some people to hail Simandou as the “El Dorado” of iron ore.
So when mineral extraction giant Rio Tinto acquired the exploration rights at Simandou back in 1997, many people thought it would change the company’s fortunes forever. But things didn't quite work out that way. Because nearly a decade after acquiring the rights to mine Simandou, Rio Tinto hasn't actually mined anything. Find out why here.
What is Milk?
On Wednesday, we talked about the problem of semantics and the rise of the plant-based milk industry. According to the Britannica, milk is a liquid secreted by the mammary glands of female mammals to nourish their young for a period beginning immediately after birth. The Handbook of Food Chemistry will tell you milk is a liquid combination of fat, protein, enzymes, vitamins, and sugar produced by mammals to nourish their offspring. Closer home, India’s food regulator FSSAI thinks milk is the normal mammary secretion derived from milk-producing livestock.
And while there are subtle differences in how these agencies define it, they all agree on one thing- milk and mammals go hand in hand. However, over the past decade or so, a new burgeoning industry is staking claim to the word “milk” without the whole mammal equation and it’s upsetting a lot of people. Here's why.
Another one bites the dust
On Thursday, we talked about the merger between Lakshmi Vilas Bank and DBS Bank India. Lakshmi Vilas Bank is old. Almost 94 years old. And while it mostly tends to customers in Tamil Nadu, it does have a pan India presence. However, over the past couple decades, unfettered ambition and corporate greed pushed Lakshmi Vilas Bank (LVB) on a dangerous path. No longer content in being a small bank, they started extending big-ticket loans to corporates. And some of these loans went bad, saddling LVB with hundreds of crores in losses over years.
And all of this culminated in its downfall. But now it seems like the bank might get another lifeline. We discuss that here.
A Tax for Working from Home?
On Friday, we talked about a brand new idea called "Privilege Tax". A few days back, Deutsche Bank’s research desk published a report titled — “What we must do to Rebuild”. The report charts out possible measures governments across the world ought to consider while rebuilding the global economy and it prescribes solutions that could offset the devastating effects of the pandemic. However, there was one interesting proposal that caught everybody’s attention- a tax on remote workers.
The report contends that working from home is a privilege. And since it's here to stay, it is imperative to tax the privileged folk and repatriate their income to those who do not have that luxury. You can find out more about this proposal here.
Aaaand that's a wrap! Have a great weekend.