Charlotte Street Partners



Modi's moment of reckoning

Written by Javier Maquieira, senior associate 
Edited by Tom Gillingham, associate partner
5 May 2021

Good morning,

In 2014 Narendra Modi became India’s first prime minister born after the country’s independence from the British empire.
As the leader of the Indian People’s Party, his campaigning revolved around the nationalistic goal of boosting India’s self-reliance. This idea has in turn been underpinned by a hyper-nationalistic domestic agenda aimed at turning the country into a Vishwaguru or ‘master of the world’ that owes nothing to no country.
Those dreams are now in peril, however. And Covid-19 is to blame.
India reported yesterday 357,229 new coronavirus cases and more than 3,400 new deaths over the previous 24 hours, although health experts believe the true death toll could be between five and 10 times higher than that.
The overwhelming situation on the ground, which has left horrifying images of daily funeral pyres and patients dying in the streets without oxygen, has forced New Delhi to seek and accept offers of help from tens of foreign governments, including the United States, Russia, and, interestingly, China.
While domestic pressure is mounting on India’s government to introduce a national lockdown, Modi has so far insisted that individual state authorities should consider such restrictions as “a last option” due to their economic impact.
This resistance from the prime minister has done nothing but worsen New Delhi’s mishandling of what now looks like an uncontrollable virus surge. For a country whose ambition was to become the world’s biggest vaccine manufacturer but only around two per cent of its population has been fully inoculated, foreign policy prowess appears to be at a premium.
Arguably, the Indian leader’s ideas of national prestige and global respect have come face to face with the reality of an interdependent world, of which India’s £1bn trade agreement with the UK is just another example.
Unveiled yesterday, the British-Indian “2030 road map” aims to boost economic ties between both countries in key areas such as trade, education, and defence by reducing trade barriers, increasing academic collaboration, and promoting the development of renewable energy.
For all it’s worth, the deal remains a bilateral interaction between two governments that have time and again used the idea of sovereignty as their battle cry. Yet if the current pandemic has taught us anything, it is that interdependence affects us all, and some countries more than others.
Modi knows it. Whether he comes around to abandoning his dreams of Indian self-reliance and decides to embrace multilateral action to tackle global challenges is another story.


Speaking at the last BBC Scotland leaders’ debate before the election tomorrow, the Scottish first minister said last night that her party would not hold a wildcat referendum on independence if the SNP wins a majority. Nicola Sturgeon accused the Scottish Conservatives’ candidate, Douglas Ross, of spreading “smears and untruths” about her position on the issue, adding that “I will build, and ultimately I think win, the case for independence through patient persuasion of people across the country.”
Mexican authorities have vowed to carry out a full investigation into the collapse of a metro overpass in Mexico City that killed at least 24 people on Monday night. Concerns over design problems and construction standards had been raised since the affected line was inaugurated in 2012.
The conservative leader of the regional government of Madrid in Spain has doubled her party’s seats after a snap election and acrimonious campaign marred by death threats against several candidates. Isabel Díaz Ayuso, who defied the Socialist-led central government by keeping the capital’s bars and shops open throughout the pandemic, still fell short of a majority and may end up in alliance with far-right party Vox.

Business and economy

The UK government has pledged to invest an extra £29.3m to fast-track vaccines that fight new Covid-19 variants as the virus is expected to keep mutating. Ministers plan to use the cash to boost testing facilities at the Porton Down research laboratory, fund vaccine manufacture, and measure the levels of protective antibodies against the coronavirus generated by different jabs.
France has threatened to cut electricity to the British island of Jersey amid an escalating row over post-Brexit fishing rights. The country’s maritime minister, Annick Girardin, has warned that the French government was ready to use “retaliatory measures” after finding the UK’s introduction of new rules governing access to Channel Islands waters unacceptable. The UK government has responded saying “Jersey is responsible for its own territorial waters.”
Odeon is set to reopen the “vast majority” of its screens in the UK on 17 May, as indoor venues are allowed to resume operations. The cinema chain, which has more than 120 venues in the UK and Ireland, announced it would be showing a selection of “modern and classic titles” in addition to new releases.

Columns of note

Writing in The Times, Josephine Moulds encourages more businesses to embrace a circular economy model aimed at removing waste from the system by cutting emissions in supply chains and ensuring products and materials are reused. As more polities such as the European Union, UK, and US introduce new regulation to cut out single-use plastic and make sure producers pay the cost of managing packing once it becomes waste, she makes the case circularity and impact investing in circular businesses. Her piece includes the case studies of DS Smith and Huhtamaki. (£)
In City AM, Emma Jones hails the emergence of a new generation of retail entrepreneurs bound to reinvent the British high street, as many seek to build a new, hybrid trading model. In addition to having a physical presence for limited periods of time while building digital sales, many of these small retailers have social purpose and sustainability at the heart of their offering, she writes.

Cartoon source: The Times


What happened yesterday?

London stocks finished lower on Tuesday, with the FTSE 100 ending the session down 0.67% at 6,923.17 while sterling was weaker against the dollar by 0.14% at $1.39 but stronger versus the euro by 0.19% at €1.15.
In the US, technology stocks suffered their worst daily performance since mid-March, with the Nasdaq Composite index falling 1.9%. The broader-based S&P 500 dropped 0.7%.
In company news:
Frasers Group rallied 5.72% after the retail and intellectual property group said it was starting a share buyback of up to £60m to reduce its share capital.
Provident Financial was down 2.78% as the doorstep lender said a review of its consumer credit division was nearing completion, with the outcome to be announced with its full-year results next week.

What’s happening today?


Alpha Fx Group.
Anglo American
Gran Tierra
Hong Kong Land Holdings Ld
Johnson Service
Mpac Group Plc
Personal Group
Ten Ent Grp
Renewables Infrastructure Group
Toc Property
Tritax Big Box 

Int. economic announcements
(08:55) PMI Services (GER)
(08:55) PMI Composite (GER)
(09:00) PMI Composite (EU)
(09:00) PMI Services (EU)
(10:00) Producer Price Index (EU)
(12:00) MBA Mortgage Applications (US)
(14:45) PMI Composite (US)
(14:45) PMI Services (US)
(15:00) ISM Services (US)
(15:00) ISM Prices Paid (US)
(15:30) Crude Oil Inventories (US)

Source: Financial Times

did you know

Because of their metabolism, if hummingbirds were the size of an adult human male, they would need to drink the equivalent of a can of Coca-Cola every minute in order to survive. (source: @8fact)

Parliamentary highlights

House of Commons

The House of Commons is in prorogation and will next sit on 11 May.

House of Lords 

No business scheduled.

Scottish Parliament 

The Scottish parliament is in recess ahead of the election on 6 May.

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