Modi 3.0 to greenlight more international flights

Top of the Morning

Welcome to Top of the Morning by Mint, your weekday newscast that brings you five major stories from the world of business. It's Tuesday, June 11, 2024. My name is Nelson John. Let's get started:

Indian benchmark indices closed in the red on Monday, ending a three-session streak of gains. The Nifty fell by 0.13%, while the Sensex dropped by 0.27%.

India's IT giants, Tata Consultancy Services (TCS) and Infosys, have seen a significant decline in their younger workforce over the past couple of years. According to an analysis by Mint’s IT correspondent Jas Bardia, the share of employees under 30 at TCS has decreased from 59% in FY22 to 50.3% in FY24. Similarly, Infosys has seen a drop from 60% to 55% during the same period. This trend is not due to AI replacing jobs but rather the IT sector's slowdown in hiring following a period of subdued growth. Analysts note that both companies, along with others like Cognizant and Wipro, have a substantial portion of their workforce based in India. TCS and Infosys are particularly transparent about their younger employee demographics.

Just last week, Nvidia briefly surpassed Apple to become the world's second most-valuable company, reaching a market capitalization of $3.01 trillion. This milestone left Nvidia's CEO and shareholders in high spirits but also raised concerns among analysts about the company's future trajectory. What's behind Nvidia's meteoric rise? According to Mint’s Shouvik Das, it's all about AI. As AI technology like OpenAI's ChatGPT gained prominence, Nvidia's GPUs, for long a favourite among gamers, became essential for major companies globally. This surge in demand has placed Nvidia in a favourable position—its chips are now on a years-long waitlist, allowing the company to set premium prices.

India is on the brink of a significant boost in international air travel. The government is considering greenlighting more international flights due to a surge in demand, sparking a mix of reactions within the aviation industry. Akasa Air and several foreign airlines are in favour of increasing flight rights, but Air India is strongly opposed. Discussions, which began pre-election, are focusing on potential increases to destinations where flights are already at capacity, such as Dubai and Qatar. This could lead to more air traffic and more options for travellers. However, the impact on Indian carriers is a major concern. While newer airlines like Akasa are eager for the expansion, fearing that limiting flights will lead to skyrocketing airfares, Air India worries that it might hinder their growth and plans to become a major global hub. Airlines like Emirates and Saudia are also pushing for more access, arguing that the current caps no longer reflect the growth in air travel demand, especially from the booming Indian diaspora. Mint’s aviation correspondents Anu Sharma and Mihir Mishra report on the evolving landscape of Indian aviation.

Maniraj Pattamsetti, a mechanical engineering graduate from Bengaluru, hoped Simplilearn Solutions' job guarantee programme would be his gateway to a new career in data science. Despite investing over ₹2 lakh and completing a six-month course, Pattamsetti found himself working a customer support role in a BPO, earning far less than promised, without any job offers in his field of study. Simplilearn, valued at $600 million and backed by Blackstone, had assured Pattamsetti and others a job with a minimum salary of ₹5 lakh per year post-completion, with a full refund if they failed to secure employment. However, two years later, only 271 out of 900 enrollees landed jobs through the programme. Many, like Pattamsetti, feel cheated, having invested significant amounts into an education that didn't pay off as expected. Mint’s startup correspondent Samiksha Goel reports on the situation, which has led to numerous complaints, with some students considering legal action against Simplilearn. The company, however, has stopped the programme and moved on, leaving many students grappling with debt and disappointment. This scenario underscores the challenges within the edtech sector, where aggressive sales tactics and over-promising can lead to significant consumer dissatisfaction.

As Xiaomi marks a decade in India next month, the tech giant remains undaunted by the Indian government's cautious stance towards Chinese companies. In an interview with Mint’s tech correspondent Shouvik Das, Xiaomi India's President, Muralikrishnan B, outlined the company’s ambitious three-year strategy to solidify its brand presence and enhance local manufacturing efforts.Despite past market dominance, a recent sales dip has spurred Xiaomi to implement a robust recovery strategy. This includes revamping its image in the premium segment, enhancing its ecosystem of devices, and balancing sales across online and offline platforms. In an industry where local sourcing and manufacturing are increasingly crucial, Xiaomi claims that nearly half of its non-semiconductor components, including key elements like camera modules, are procured locally. This effort aligns with ongoing discussions to encourage more of Xiaomi’s supply chain partners to establish operations in India, further deepening its local integration.

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Show notes:

TCS, Infosys witness dip in younger employees

Mint Primer | Intelligent bet: Can Nvidia keep up its swift rise?

Modi 3.0 may increase quota for foreign flights

Hard lesson: The dark reality of Simplilearn’s job guarantee plan

Xiaomi India eyes increased localization, Apple-like ecosystem