S&P Global — 15 November 2024
Daily Update: November 15, 2024
India Looks To Build AI Potential
By Nathan Hunt
Start every business day with our analyses of the most pressing developments affecting markets today, alongside a curated selection of our latest and most important insights on the global economy
India has been on an economic hot streak. Its annual GDP growth exceeds all developed countries, and most economists believe that its runway for growth is considerable. India is projected to be the third-largest economy in the world by fiscal 2030–31. However, AI technology and its anticipated productivity gains have been a predominantly US and Chinese investment priority. The model for AI development and investment in India is based on public-private partnerships. On March 7, 2024, the Indian government announced the launch of the IndiaAI mission, using a public-private partnership model to build the country’s AI innovation ecosystem. Digital India, another public-private partnership, focuses on digital public infrastructure, digital access to government services and the digital empowerment of citizens. The growth of Indian AI was the topic of a recent article in S&P Global’s “India Forward” report: “India’s AI ambitions: Can public-private partnerships lead the way?”
According to a Nasscom report, the Indian AI market will grow to between $17 billion and $22 billion by 2027, attracting investments of $4 billion and employing an expected 1.25 million to 1.35 million people.
To realize those gains, the most immediate challenge is building India’s investment capacity. India does not have a Silicon Valley with entrepreneurs and investors working to generate new businesses. In fiscal year 2023–24, US private investments in AI amounted to $67.22 billion, while private investments from Indian companies totaled just $1.39 billion. India must depend on the willingness of existing corporations and governments to fund AI research projects. Just as in the US, large technology conglomerates — including India’s Tata Consultancy Services, Infosys and Wipro — have the scale, expertise and transformation experience to develop AI.
Digital infrastructure is critical for developing India’s AI industry. While access to the internet and the availability of reliable data are crucial to produce and commercialize large language models, India also needs to develop the institutions to support AI research and development. This will require policy support for research institutions, technology startups, a conducive administrative environment and data privacy regulations.
Finally, the biggest challenge in developing AI capability is labor suitability and availability. AI literacy must be established through the education and reskilling of new and existing workers. AI will create substantial workplace displacement, but the potential for higher-skilled, better-paying jobs could offset productivity losses from lost jobs.
Today is Friday, November 15, 2024, and here is today’s essential intelligence.
Sustainability Insights: Hot Spots: Subnational Regions Outside The US Face Rising Physical Climate Risks
Data and scenario analysis show that almost all subnational regions outside the US could become hotter and drier by 2050, and some may see more frequent extreme flood events. Almost all non-US subnational regions face rising exposure to climate hazards but the magnitude differs by hazard and region. Without adaptation investments, this could increase credit risks for some governments.
—Read the article from S&P Global Ratings
US Holiday 2024 Sales Outlook: Consumers Will Trim Trees And Spending This Season
S&P Global Ratings expects holiday sales growth will slow to about 3% in 2024 from 4.7% last year, remaining below the 10-year average of 5.3%. Price actions, as well as modest volume gains given its expectation for a cautious but resilient middle to higher income consumer, support the growth forecast. The outlook is influenced by waning — but persistent — inflation that has pressured household budgets. Additionally, the late Thanksgiving holiday will result in five fewer shopping days than last year, which may weigh on sales.
—Read the article from S&P Global Ratings
Equity Exuberance and Fixed Income Foreshadowing
In the immediate aftermath of the 2024 presidential election, US equities soared on Wednesday, November 6, with the S&P 500® up 3%, while small caps surged even higher, with the S&P SmallCap 600® up a substantial 6%. Subsequently, on Thursday, November 7, the much-anticipated Fed rate cut of 25 bps came to fruition. With two previously uncertain macro events in the rearview mirror, the equity market sighed in relief, as VIX® plunged to below the 15 handle, and the S&P 500 marked its 51st record closing high of the year on Monday, November 11.
—Read the article from S&P Dow Jones Indices
COP29: Call To Action Pushes For Acceleration Of Zero-Emission Fuels Uptake In Shipping
More than 50 stakeholders across the shipping value chain have signed a Call to Action at the UN Climate Change Conference to accelerate the adoption of zero-emission fuels, including the development of green hydrogen infrastructure, to achieve decarbonization. Organized by RMI, the UN Climate Change High-Level Champions, the UCL Energy Institute, and the United Nations Foundation, the Call to Action pushes for "faster and bolder action" to increase uptake of zero- and near-zero emission fuels, investment in zero-emission vessels and global development of green hydrogen infrastructure, a statement posted Nov. 12 by Lloyd's Register, which is also a signatory to the Call to Action, said.
—Read the article from S&P Global Commodity Insights
Listen: CERAWeek Podcast | Season 2 | Ep. 03 — Beyond the Pledges: What COP29 Means for Climate, Finance, Policy and the Energy Transition
As COP29 unfolds in Baku, Azerbaijan, this CERAWeek Podcast episode dives into the conference’s key topics, from climate financing to global policy alignment. Host Atul Arya, chief energy strategist at S&P Global, speaks with Eirik Wærness, senior vice president and chief economist at Equinor, and Anna Mosby, head of global environmental policy and markets at S&P Global, to explore financing the transition, energy transition and demand and policy impacts.
—Listen and subscribe to the podcast from S&P Global
Tech M&A Outlook Mixed Under New Trump Administration
Equity and policy analysts forecast a surge in M&A across sectors in 2025, following President-elect Donald Trump's return to the White House, though the outlook for the tech sector is less certain. A second Trump administration is expected to revise a set of merger guidelines released in December 2023 by the Federal Trade Commission in conjunction with the Antitrust Division of the Department of Justice. The new guidelines lowered the thresholds at which a merger was considered anticompetitive, meaning that a larger number of deals were subject to scrutiny and possibly a regulatory challenge.
—Read the article from S&P Global Market Intelligence
Webinar: Climate Science Through The Eye Of Hurricane Helene (Nov. 21, 2024)
As extreme weather events become increasingly frequent and severe, the need for effective disaster resilience strategies has never been more urgent. In this upcoming webcast, we’ll hear perspectives from weather, climate science, and disaster response experts who live and work in the areas hardest hit by Hurricane Helene. Join us as we explore how to leverage climate data, improve modeling of compound and cascading events, and understand the short- and long-term impacts of climate change as we face back-to-back disasters around the globe.
—Register for the webinar from S&P Global Sustainable1