Top Investor's WARNING: End Of Middle Class Dreams & Loan Trap | Saurabh Mukherjea |FO535 Raj Shamani

56:33And we're hard for middle class बच्चास, because we grew up saying, exam में नंबर आएंगे, तराइस मिलेगी, तभी माप, ममी डैडी तभी खुश होंगे. Aspiration. Aspiration was external markers of success is what mean anything. खुद ने खुद को क्या आता है? वह हो बहुड कहा थाए है? तो लागा है क्या? आत था अनद ने न इस्टू अब हो अखाइब के अबी其實, बहँर कोट जोनियर हो है आए है तो तो पिए वाइल तो से एंट टुक में अज रिसेंट्ली जाए अगार आज तो वर्यास अगार आज तो वर्याइवाट इस वर्याद वाल आज़ाएं तो नांसेंस भाड मैं जाये समकुछ और मैं टाक्सी में गोपूंगा मेरे को सरडर्दी नहीं चाहिए राइट अट � यह पिलिए और लिबरेशन की, मेरे पास गाड़ी नहीं है, I agree.

57:19मैं टाक्सी में घुमता हूं, मेरे कोई प्रोबलम नहीं है. हाँ, अगर जब भॉती पॉठोल्ड रोड रहता है, अगर पॉर्टी पॉर्टी रोड़ रहता है, काश मेरे पास एक करोड़ की सभी उती,

57:46my managers have cabin and everybody has cabin and it's a very liberation feeling which you said कि जट जटी नहीं करना मैं चलते पर ते किसी की बी टेबल बैठ जाता हूं आज वही हो कि तो वहां पर guilty admission मेरा cabin है मेरा छोटाँसा cabin है वो guilty admission राइट उस से मेरे meeting हाजाते हैं बट हाँ मैं कोशिश कर रहा हूं आप आप से लिए चाहिव दो यहां लेका पूर्स ताम है भी आप से लिए लिए भी आप पिर निव दिमाग वह देखा है तो अब इर दिमाग मेर को कॉरनर वाला मेरी पान एक दिन मेरा कैबिन और बड़ा ओना चोई यहां अब फिर और अब इस आप पाधा आप बाद आ� और नहीं मेरा केबिन कुछ नहीं है और कोई मतलब नहीं अगो अगो एक ने मनें मार्क जाकर बर्ग की फोटो थी तो उनका जो कैलिफॉर सान फ्रंसिस्को में फेस्बॉक का जो ओफिस है वहाँ पे फोटो थी रही जाए लाप टॉप अधिर लाप टॉप अगो अगो इस � in his hoodie and his jeans and you know at that time it had already been worth 100-200 billion dollars so I was very striking that the person is sitting on the floor and I remember on his laptop the camera was taped on so I was very surprised that it seems that it's security so I thought I'll be able to but then I realized I can call another but if Zuckerberg can sit in the middle of the floor then I too should I learned this from अशिश्म आशिशुेर्षटि stellम डात्रों of business अजिश्य कर्दोर्सी क六 unfor 살�芸ू यकार्य। रूब फेस्पी मेट्रों आइपना इस विंदे एक ह alterneyन creator keyword इसमें लाग। He is genuinely one of the most clear and sorted entrepreneurs.

59:49And in the life of a must framework, every thing has a clarity. You know how you can bring, I just want to tell you because you should meet him. It's like sophistication of a proper guy. If you want him, go to boardroom and talk to a McKinsey consultant. And then a Delhi street smart entrepreneur at the same time. like that combination is lethal and he doesn't get you so I've never met him but I'll give you something which validates your point of view so I was put in a certain award jury I think Forbes award jury and for one category we decided that he is entrepreneur of the year in that category so as is often the case in a big hotel in Bombay an award function the Alishaan award function the rest of them he didn't come to his award he didn't come to buy a card he sent somebody else and I remember that because I never met him and the reason I remember I was on the stage supposed to give him the award he didn't come to any other his hat in his firm and I remember thinking that this is a dumb person now you'll probably be a problem classic so when I met him he he had$5 billion and no cabin no cabin $5 billion so I loved that idea ticked me and when we had like a comparatively bigger office then we were like I may be as a car now across all my companies zero office.

1:01:15This way right. This way is very powerful right. That's a simple level. It's you know it's a showing off but it's not. That person can move from external markets and success and that person can you know by mid 20s, mid 30s external markets and success can move from that life in India. Powerful. Very very powerful. So that's why I broke into three parts. It's the most basic. You said gig jobs. Entrepreneurship is one. You can put breakdown entrepreneurship in two parts. One is that you make a big empire. You employ a lot of people. You make a lot of ideas. That is one. And then another is just you're a freelancer.

1:02:00You're also an entrepreneur. You're doing it alone. Which one do you think is more viable? To each his own, right? To each his own, her own. Some people who, to run a company, you don't just need to have business smarts, right? Negotiation skills and so on. To run a company also need people skills, right? And not everybody has people skills. People skills, which is an aspect of emotional control, of people managing it. It's a very distinctive skill. and if you are either an introvert or someone who lacks people skills but you are able to build formidable subject matter knowledge so doing your own thing as a gig worker on a global scale I think very feasible very possible and I think that will become a perfectly viable career option so you could become the leading headhunter for financial services CFOs for the fintech world right and if you do that on a global basis and you make a name for yourself through LinkedIn through social media through books through podcasts that I am the guru of hunting for CFOs for fintech companies the world over and you can just do that and get paid really well for it anywhere in the world if any fintech company will need CFOs you will dial you will have made your whole network you will have made your first name terms and you will be placing fintech CFOs around the world so the so the the while the negative aspect of AI of job losses is apparent the positive aspect of this being a connected world I think we don't have full advantage in India we are still in our country whereas in our country the talent the education levels they can be used to to service the world and I think that will happen increasingly people will say if I need the world's best expert on say influencing podcasts if that person is sitting in Coimbatore you know even if I'm sitting in Frankfurt let me reach out to him or her in that global ecosystem we will find our place in the sun interesting so you said key to each their own and if you can just become really really good both have opportunities regardless of the technology playing absolutely let me validate that let me validate by using your own example right why did Macro do a interview with you right asa to nhi ki usko kal election let nhi ha and Raj Shamani ke saath podcast karega to you know swing haja votes he did a pod with you because he's just as interested right or his team is just as interested in macro ki image building here because for all he knows or we know in his post political career he might be a business leader who needs to build out an India franchise and if therefore people in India are familiar with him then so be it plus there'll be enough people in France or across francophones around the world who will be watching your pod, right?

1:05:03The global aspect of what we do is actually pretty powerful, right? And in a way, our life is a dance between appealing to a global audience if we are doing something very niche. If you are a FinTech CEO for the expert, if you become a global audience, then you can become a niche thing. You can become a niche thing. You can become a big career. And then you loop back to local knowledge, right? so you loop back to saying I'm an expert on the indoor restaurant scene on the indoor food and drink scene it's a niche market but if you want to put a restaurant in indoor or do a business in food you give me a consultancy or give me a project I start your big restaurant in indoor so both games will become relevant but in neither of them will there be a boss to bless you saying your promotion your VP car park spot a lot of this is about a lot of this is about making career decisions by yourself, accumulating knowledge relationships, contacts and then just the steady grinding over the years of building a franchise.

1:06:12Have you seen any country where this polarization happened and middle class almost broke, middle class broke and middle class money is less than they have done anything. But in hindsight, if you look at that, they also went through this and one country did good and one country did bad. So, look, two countries where middle class was a big deal, which is clearly seen as UK and USA. So, in both countries, the polarization between mid 80s to roughly 2015 was a big deal. I saw it in UK myself. My parents migrated to UK in 91. We lived in one of the outer suburbs of London. So, there were all these call centers.

1:07:01The British insurance companies were called centers. People called for their claim. So, in 90, when we reached a decent suburban town, by 2001, all the call center jobs were outsourced. by 2008 when I left that small suburb of London all the buildings were empty because all the jobs were in India Gurgaon, Bangalore and because for those British companies it was far cheaper to employ a caller in India than having a British person and if I go back to that town in England where I grew up there is a bad scene now buildings are derelict, town center it's completely wrecked. It used to be a lovely shopping mall, high street, nice restaurant.

1:07:51Now, it means, after 8am, it's scared of being in the evening. Drug dealers are looking at it, crime comes in, etc. And this is not some, you know, some God forsaken part of the UK. This is a suburb of London. And, for 10 years, India has come from 10 years. And by the way, this is one of the reasons for writing Breakpoint. These changes are happening very speed. So, it's not that you and I are talking about 5 years later this is happening in India and it's so fast that unless you are awake and alive you can neither understand the risks to your business nor appreciate the upside possibilities so in UK I have seen this I didn't have a big deal I am going to work but when I am going to a small town I can see the challenges in small towns in America why do small towns even if you go to places like Philadelphia Philadelphia, it's a little bit of working class area in Philadelphia and Chicago in Chicago working class area, they are terrifying places to go to, right?

1:08:51It's very small, it's a slum kind of place, there are young men wearing hoodies and with weaponry and at night 5 o 'clock after an Uber driver will go there at night, at night, at 5 o 'clock after an Uber driver will go there because they will go, the car will go

1:09:14So that's America and UK for you. After 20-30 years of white collar jobs being outsourced to India. And blue collar jobs being sent to China. So what's happening here? There's a scene. And that's why the US is very good. That we know. And that's why the US is very good. Right? Right? So what we discussed in the previous part. What Trump very cleverly did. Is he saw this. and he said yarr he's been hit they're not understanding why they're hit because to be honest if you and I lived through that 10 years our whole life upside down got so in 1984 Bruce Springsteen sings Born in the USA basically how proud we are American born in the USA our must life by 2004 those jobs are gone to China unemployed in the USA born in the USA unemployed in the US right in the space of 20 years and and and Trump by 2014 is saying this is my chance this is all unemployed frustrated in the comments I tell them why did you come to your Pange because China took your job and the rest of the rest of the rest of the rest of the rest of the rest of the rest of the rest India initially he started in his first term when he did his first term he said all of the rest of the rest and in the second term we realized let's villainize Asians and then Indians and then you can see we discussed in the last part what happened in this?

1:10:45Out of nowhere, let's throw Iran because Iranian people are going to attack us on our you throw them and you are now seeing the consequences of that so neither UK nor USA have found any answer but the politicians have capitalized by focusing on middle class discontent now if there is a positive story positive story I'm before positive. Do you think UK and US middle class doesn't understand that jobs are going to change? This was a while ago in UK and then in US. Their jobs came to India. Their jobs came to China. Our jobs are going to be in India and it's happening. Our jobs are going to be in AI.

1:11:27I mean, our jobs are going to be in AI. And your prediction is the same thing here too. It's going to be happening. So UK and US State system was good There was better healthcare Better kids education So there was survival If it happened then We don't have education We don't have healthcare I lived through the UK And I saw Brexit India came but Brexit I saw Brexit So there are three things Which are very funny when it happens in real time right when it happens in real time the town where I grew up in London when it was being hollowed out nobody told the people in that town what's happening right it took me because I used to go between India and UK it took me 10 years I finished school college college job started it took me 10 years to understand why the town I grew up in in the suburbs of London got hollowed out there people probably haven't understood what happened I felt 10 years and nobody told the people in that town there was a local newspaper but there was no news in this kind of news and local politicians kept their mouth shut in that in that town in England they didn't explain that your jobs are going to India because I don't know why but I mean they just didn't do it similarly when America's jobs sucked out in China it wasn't until 2005-06 by which time most of the jobs had gone to China that Alochana started in the US that your jobs are out of here and that's the first path to realize.

1:13:08Today in India some people are saying that it's got a robotization or automation when we were researching breakpoint we went back and looked at studies in India. Studies have been done from 2012 onwards that India is out of factory and the data suggests that factory jobs are automated in India from about 2000 from 1000. Right? So, research remains, shows in data, but no one doesn't give up because it doesn't suit anybody to publicize these things. If I am the employer automating my factory, I'm not gonna do a podcast with Raj Shamani saying, Raj, I'm automating my factory. I'm not going to take people out of the 90%.

1:13:47If I am the politician in that neighborhood, neither am I gonna be telling my constituencies, I'm sorry, you guys are unemployed. So, and the academic, the academic, I'm sitting on my paper, but I'm not reading it. Other than geeks like me who are reading it now saying, in India, in the data, it's been going to our factory in 25 years. So, this is the first thing. The second thing, even after the jobs are gone, right? So, UK and US are going to go. UK and US The call centers are going to go. US and China are going. Even after the jobs are not gone, it's not obvious what should we do. So, Trump is saying that in America in America, I will make jobs.

1:14:27Then how will you make it? Why will any factory owner in his right mind pay four times the Chinese salary to employ Americans in Michigan? Right? And Michigan is not that there is a very big infrastructure that there will be a competitive advantage in Michigan. Similarly, if I'm an insurance company in the UK, why will I bring the jobs back to the UK? okay at some point now western companies rather than an Indian call center which is the next hit we face they are saying AI will work so they are saying now in India call center Indians put AI but it's not clear what do you do in UK and US to create jobs back there so that's another thing that when it happens when it happens no matter what when it happens unemployment other than creating racist sentiments in the western world Brexit MAGA it's not clear to politicians what is the economic answer to this problem right and the third aspect to this you were asking about constructive positive case studies positive case studies but there are many so for example Japan I think is a is a positive case study right Japan in this category middle class hollowing out is not seen in Japan when I went to Japan two times I was a lot of work in that country I was a lot of I don't see this category I don't see this category this category in Japan.

1:15:51There is no problem in Japan. There is no problem in Japan. So they have got lots of old people. Their population hasn't grown I think for 20-25 years. I think the government is giving some incentive to do something. I think Korea is also getting incentive. Japan is getting in China. So Japan has not been in this middle class hollowing out. I won't be able to tell you 100 % why were they able to escape this because they are also an industrialized country. but I guess they were able to stop a big part of their jobs going to China I'm sure Toyota and Sony and Panasonic would have sent some amount of production to China but I think they were able to hold on to enough by automating the factory and robotizing the factory to the extent where anyway labor is not necessary, factory becomes immensely robotized, automated plus their children have not been born, so that's why they had to take a lot of people to work to put them in the world.

1:16:47They had a very good education system, very good healthcare system. They had a good study. And they put them in managerial jobs or finance jobs. So that's one country I have seen which has escaped this. But you have to say that Japan has taken immigrants. Because if you take immigrants, that's part of the challenge. UK and US had taken a lot of immigrants. Those guys displaced local workers as well. The local workers then got screwed both ways. One was an immigrant, another was China was done jobs. or India has gone on jobs and the local fellow got completely zapped and then voted for Brexit or Magao.

1:17:20So Japan is a good case study. Now how much we can take advantage of that in India is clear. And therefore, where I am understanding, we will have to think our way through this. No other country at as low per capita income as us. Our per capita income is only$3000. dollars from$40. We are amongst the poorest 40 countries. We are a poor country but because our middle class is relatively prosperous, right? Those who are taxed taxed, average income is based on 1 ,50-1 ,100 ,000. So, they are second world status. Because our middle class is relatively prosperous they are taking AI. So, it's a very strange situation.

1:17:59We are a poor country similar our levels of income are similar to sub-Saharan Africa. On average basis, we are like sub-Saharan Africa. but AI is the potential of us as much as UK and US is on the way right so this is kind of we are getting the worst of both worlds that not our income is more than our technological advantage at this point and our opinion right so this is the piece and therefore we have to think for ourselves understand the problem before if you have to look at the solution you don't have to understand the problem you have to understand the problem and then say how do we move forward in breakpoint we are saying we move forward by A looking for the gig jobs that the new AI world will create.

1:18:43B by changing mindsets, changing our ideology who exam, ratta bazi and exam chhodke becoming entrepreneurs early in life realizing that jobs are few but there's plenty of work. Training our bachchas to be entrepreneurs rather than training our bachchas to be office workers. Right. And then turning to sarkar and saying funding ecosystem ban rhi hai aap please rules or regs rules or regs for small businesses halka halka kije jis se poor eye entrepreneurial boom aye and then gradually perhaps yeh lath uthraygi 10 saal exam dene ki so moota mooti today the problem is padaai se kuch nhi ho raha jobs hai nhi business karna agar chate bhi ho to pata nhi kya karna hai and in that ecosystem josko So the idea is that it is growing up.

1:19:38And that's always the beautiful part of a free market economy. If the other people don't understand the idea and you are coming, if you understand the idea that you can take advantage of it, then you have all power to it. Would you say that young people don't want to go to college? I think education is necessary. Education is necessary. Knowledge is all powerful in the modern world. Knowledge can be made in this world. formal credentialing at any time you will get to the formal credentialing I think it should be a debate on that. Data is showing that class 12 class 12 past person does just fine in India.

1:20:16That makes a great deal of sense to me. So your point is that you should always study but in a specific specialized way. This is not necessary to take degree degree which is a very formal degree. Let me validate this by pointing to you. You have made it figuring out. made. You've created figuring out what four years ago long before I wrote breakpoint. You figured out that there is a need there is a need for someone to explain to you figured out there's a need for someone to explain the world in simple language to the masses. So in India there is a need for someone to explain you figured out that if I can just explain the world to people I can build a business for myself.

1:21:01Effectively you have understood from your intuition that there is a need in the country and I will fulfill it. So, other entrepreneurs need that same way all I am doing is basically formalizing formalizing that intuition that you had I am saying where I am showing I can see the data is saying jobs are not who has a job is getting worse and I can see that social media is causing havoc because people are getting the wrong message from it, they are either getting deluded in some glamorous life which is completely unaffordable or in some financial satta bazi which is a road to ruin right the constructive aspect the figuring out aspect of it lost in this craze for glamour and quick money interesting so two things on this one is before I ask you my thing which will start another discussion tell me one of the craziest insights or something that you have made a book when you know.

1:22:05So the one which so there was a guy called Harshaj Shah he added a post in July 2025 on LinkedIn. So I put his post in the book Harshaj Shah's post. Harshaj Shah's post he showed that entry level salary into a decent white collar job. Graduate entry level salary into a decent white-collar job in the year basically 2.5 lakhs right construction worker in Bombay, Delhi, Bangalore working overtime in the year 5-6 lakhs right so his post went viral but leaving aside his post going viral I had 2-3 days his post didn't get out of mind because you know I know so many people inside my social circle where parents work so much, money, money and I know that 3 ,000 ,000 ,000 is what you get as an entry level graduate in most Indian companies.

1:23:05In fact, 20 years ago I got so much. 22 ,000, 30 years ago I first came to Mumbai to build a business in 2004. That's how much. Today I got so much. And today I got construction workers for 5 ,000 ,000. In fact, I'm asking you how much you earn from auto rickshaw driver. Most of the big cities in our country auto rickshaw driver earns 5 ,000 ,000 ,000 ,000 ,000. so that I felt a lot and in a way this is the break point right you start brainlessly mindlessly in a mode graduate and you find a job when you see in data that there is no benefit but then this is skewed data skewed is this is why data is entry level job a construction worker if entry level 5 lakh rupees कमाता है साल के और कोई जॉब करने जाता है माल लो एक इंजिनियर है या कोई भी X Y Z person वो ड़ही तीन लाक में लगता है तो जो तीन साल, चार साल, पाथ साल बाथ जब जॉब की जब पैसे बढ़ते हैं, construction worker तब भी उतना कमा रहा है, इस इंसान that point lovely point because you have made this mental model this at a superficial level seductive and this we like middle class we have worked through our 20s but data but in 10 years money is increasing eventually people make money but I will try to give you data story to give you the first thing is that again back to the government's income tax data that is showing that a typical middle class income tax filer, middle class defined as 5 lakhs se 1 crore kamane waale average filer ki kamai hai 10 lakh average income tax filer ki kamai hai 10 lakh, so therefore that youngster who graduates and gets a 2-3 lakh ka job if he ends up being the Indian average kareeban somewhere around 10-11 lakh point paunche ga remember to get to this point, jhaan peh usko graduate level job in li hai, which Azim Premji University data is telling us in 100 someone gets like this job who gets like this he gets 3 lakhs his parents have spent god knows for 21-22 years in that child's education so much they have a big 25 months exactly and then if he ends up being the average income tax payer he'll end up earning 10 ,000 ,000 ,000 now let's go back to the construction worker I agree with you if he's a whole construction worker to that will remain on 5 lakhs right but my reckoning is that person is far more likely to do something entrepreneurial and become your next Ash Mahapatra perhaps of business than the dude who is graduating because the graduate dude is self-selecting into a life of safety, structure, assured pay, bonus, promotion whereas the construction worker will say I will have road for overtime for 5-5 years but I'm putting this cement, this pipe what sort of can I become a middle man can I become a contractor so the people who refurbished my first house and I'm going to tell you the story the guy who refurbished my or decorated my first flat which I bought in Bombay in 2008 I bumped into him on the street two weeks ago he's now running his proper firm with 10 workers He is decorating our Pauai at any point in time 3-4 people's flats redecorate His son is working for the big four His daughter is an airline pilot One daughter is an airline pilot and his third daughter is fashion design His third child is fashion design Right?

1:26:57So he was and before he decorated my flat he was just a regular dude working for someone else doing up painting and painting for flats in Pauai so he moved from being a painter to hiring 2-3 people to do my flat up and now he runs a proper firm's local shopping mall his small shop is a big shop and after that big four airline pilot fashion design so I think that's where I think we need to reimagine that from this job the probabilities are far higher you'll rise by buying self-employed I appreciate that the data currently shows that the self-employed people are earning far less than the salaried workers.

1:27:40But I think salaried workers salaried workers real wage growth I think tough rahe ga because technology will put more and more pressure. Whereas the self-employed, the SME has provided that person is entrepreneurial. It's more than that. Interesting. Okay. These are all very negative. Positive or not? If you're an SME, if you're an entrepreneurial person, positive or positive? Because you're making business, you're big. Back to my childhood. I thought growing up business they're going to drink scotch and they're going to drink black money. That's changed. I'm doing business. I'm drinking white and I'm drinking juice in the night.

1:28:32Okay. So tell me now based on your experience and the data that you're collecting and everything that you're seeing now plus what you're seeing in the market globally where you see five six businesses which are going to be an opportunity specific and we'll talk about specific opportunity which you feel doesn't matter it's hard or it's very easy so So, so, first, first, I think, a very big opportunity will become and, you know, someone of the stature of Seah, Mukesh Ambani or Jensen Huang will grab it. So, let me explain a little bit. What's happening now? If you are a big company and you want your project done, you call up a TCS or an Accenture.

1:29:27They are big companies and they are a million people who put your whole app or your software integrate in your systems. Increasingly as AI does a lot of this work as Cloud or Anthropica Cloud or ChatGPT does a lot of the work especially for small and mid-sized companies who can't afford to hire a TCS or an Accenture they'll end up calling a smaller version of TCS Accenture and say I want a restaurant in South Africa chain. I have say, four fried chicken restaurants. And I have a customer servicing software. I have to add Swiggy Zomato in South Africa. I have to add software in AI. You can give me for five for five thousand dollars.

1:30:21Right? Now, now, I think and most more likely than not an Indian company should emerge and that company doesn't even have to have employees they'll just take the project and they'll have a network of gig workers on their books like Uber and they'll say who has to do it 5 days so you're giving maybe if if you're giving 5 ,000 dollars South Africa maybe this company will give 2 ,000 dollars and 3 ,000 dollars will keep it right and because remember that South Africa restaurant chain might necessarily not necessarily know how to use AI to create its software but it knows that it just has to call this or go to the website of this Indian company and put this work request there.

1:31:03So, this will become a colossal business. And I think if you take this business model to its logical extreme, I think it basically destroys the business models of the conventional IT services companies. So, I have some share of Accenture. So, hopefully before I don't go out, I'll do something. So, this is the first model. Now, I have said this in the context of coding. But this is just as applicable for say a company saying I have to give my employees marketing training right Raj you can make a curated set of podcast marketing training and our employees plastic pipe right and there will be someone like you who will know how to use available content AI and say absolutely we will make 24 hours for 5 hours training program on how to sell plastic pipes across India and that content will give you in four languages.

1:32:06So not just coding but knowledge, skilling of every sort there will be intermediaries who will emerge who will say we'll package it for you at low cost at high speed and give you whatever you need. So remember even for small businesses time is money. If you give me that market that training plan for my training content for my sales team two months from now that two months I didn't get to the sales team right and if you therefore give it to me two days from now I'm that much more inclined to give it to you and the more effective it is the more I will say the next time when you need it you will go to Raj or that small IT company which has made us Fortafort right and I think that this will end up being a colossal industry and I stress again I don't think you have to make a big company you just have to build a system where you sit at the heart of a network of content or content creators and you are booking the order, getting it done, getting the work out.

1:33:08So, this will become a big industry and a lot of the geek jobs will evolve around this. So, basically, think about Swiggy Zomato or Uber. This is Uber for white collar work. This is Uber for white collar work. And this can also be seen in many advertisements in India. The whole advert has made AI. right so the model is also AI lighting is also automatic so you can imagine the whole media houses of the future will be basically AI houses right and they'll specialize in maybe by product segment so India I think is a big play because why would you want to hire a Chicago based media house if you can get the same work done in Oshivada for one third the cost right and I think that will come and smart people across the world will say or Chicago based or Hollywood based media house we go to Oshi and do it in North Bombay.

1:34:00Okay, so this is a big value. Now, the next leg is using AI to create original content using the whole world of knowledge to create original content, original constructs, original intellectual property. I think China has been doing a big job. So, China has done in the last 10 years got their universities to spend a lot of money go and do berabari with America on intellectual property. So I'll give biotech half the biotech in the world is now new brand new divide comes from China 10 years ago it was zero it was all America China said that now the world is on the internet we are people who are why we will only make a phone and why we will only make a car we will sell a brand new intellectual property.

1:34:58Right. And I think we've got enough intellectual firepower in the country to do it. We need to spend the money on it. Now I'm not so sure the government will spend the money. But I think our corporate should spend the money. So American companies sell 700 billion dollars in research, R &D. Indian companies sell 20 billion dollars. Right. One thirty fifth. Right. plenty of our companies have enough and more money balance sheet in cash stock market how much you want to take it but the owner is saying no, you don't have to take it R &D, I don't know if it will be something that will be useful so that's the old biscuit that will be made 15 % profit margin so my life will go down I think a new generation of entrepreneurs will say screw this let's either raise the money from private equity or the stock market or borrow the money and throw it at R &D because we have seen China do it with no or limited help from America.

1:36:03China has built an R &D machine which as I said in biotech they are doing berabari and probably 20 years later biotech's all the data will be made and then we will say where are we going to be? We are taking this. They are saying if you want data then we will give it. So it's a choice of ours as a country either we spend the money on R &D and it's a choice for our promoters not so much for our government or we get left behind right so this is another I think it's very exciting possibility that maybe in the next 20 years we will have a path of R &D where an entrepreneur will say why am I not the world leader in for example auto ancillary technology right and the third aspect is in the line of work what I do I think that the whole world will manage the whole world from now to 10-20 years will manage the whole world of money will be managed from India.

1:36:52Because if AI is going to, if technology is going to do a lot of the management, why should we be left behind in figuring out how technology can manage money? Right? When people manage money before the people, people think I'll give money to my type. If I'm a French national, I'll trust a lot in French people. I won't trust a lot in Indian people. But if anyway, gradually the managing of money will go to first ETFs, index funds and then AI. So what is it needed? Is it Indian AI or British AI? So financial services banking. So Revolue is a bank in London. It's an AI driven bank run out of London.

1:37:38It's also in India. In this way, Indian AI driven financial services institutions will go global. and a lot of people especially younger people are not going to care that this is AI Indian because the LLM is most likely American and above that LLM someone has done something interesting useful provided I can see it is reliable and it's regulated by the Swedish regulator or the European regulator or the US regulator the fact that there's an Indian company behind it doesn't matter so the ability to do things which are global because remember we are the benefit of the modern wave of technologies, we in India are getting the latest technology.

1:38:20We can't say we are back. Technology is getting where we are back. The utilization of technology for doing science, for doing R &D, for doing research. We are very content to do the day-to-day earn the 15-20 % return on capital and say we have sold something. The Chinese are saying we are not content to the day-to-day we will use technology push it to its limits and and create brand new intellectual property which we will monetize and nicho do the world so if you research monetize the mindset is not left behind then we'll get left behind and again i think that's the mindset shift we need to do rather than doing it services rather than just doing generic rather than just doing copy paste or financial services if you are willing to take the risk do the extra effort come up with brand new intellectual property then there's a global market for it how far do you think India is to America and China per capita income China is 5x America is 30x per capita income but I've watched China close the gap with America and especially on the knowledge and IP front.

1:39:41I watched China close the gap with America over the last 20 years. And I watched America itself pull away from Europe over the last 20 years. And if I go back further in time, that 1880 to 1930 I saw if I read 1880 1880 Britain was the world's preeminent superpower. That was the world. in Britain by 19, in fact 1880 if you read the US descriptions it's a teacher country, it's a poor poor, it's in the underworld, it's a poor fight with another, it's a war by 1930 they were the world's preeminent superpower so in 50 years they had a whole set of power and then over the last 20 years China in 2004 was nothing basically they were a sweatshop for American jobs, China in 2026, the new biotech data in the world is born there.

1:40:42So India, do you think if you compare the 1800s of America and 2004 of China, those things were the right things, is India also the right things? So I'll give you the good answer. Some things we're doing right, some things where I'm understanding, we're doing wrong. So let's quickly discuss the positive things we're doing. the whole angel venture capital private equity this is positive shark tank story 1 million entrepreneurs a year right so if you look at American and Chinese culture the early stages of growth take off because these are ultimately entrepreneurs start ups and that person is ready to take risk right because with the best friend in the world the angel is not gonna call up you know he's not gonna call up HDFC bank he's not gonna call up TCS middle managers he's not gonna do that right he looks he wants someone he's saying I have left my job I'm taking my life I'm not giving you so in our country that world is getting better and very similar to America 1880s China China of 25 years ago right that's a positive thing and it's very difficult by the way manufacture this a lot of European countries France, Germany have been very successful and they say you become entrepreneurial and they say no, they don't have to become entrepreneurial and they don't have to be so you can't manufacture this there is a cultural element that is especially in our country the age group of 25 years and it's interesting it's not just Gujaratis, Maharwadis, Sindhis I'm seeing Udiyas, Bengalis, Marathis, Tamils all are doing and everyone has a joke that we are entrepreneur and we need more of this we need to king size this ambition which is negative piece now there are so many rules so many regs and so many red tape that people are crazy so I have cited in the book because I still can't believe it so if you have in our office in the pantry if we put a chula even induction cooktop if you cook hot food you cook food you need a license right FSAI license you can make tea it's hot in the kettle but if you you make you make you make you make with your annual inspection license fee thankfully fee but fee but you have inspection right if you put a chiller not the fridge but if you put a chiller where cold drinks cold drinks your office staff cold drinks dheke kholke pye uske libe license alag see right ah woh kuch license state government deeti hai kuch center deeti hai fs ai deeta kuchka annual renewal kuch i think 2 sal mein renew ho ta kuchka her sal inspection hooga kuchka 2 sal chow chow ke right to hum nne decide kya yaar hum aisa hum kuch sar dar di chahi hi so we decided it, what is the difference between someone who has ordered you?

1:44:00Now, what is the difference? Somebody could have easily got a job in millions of small small firms like Marcelas, cooking in the kitchen, cooking Maggi, making ananda toast in the morning. So, that job will not be done because there are crazy rules. Now, who is the best I don't understand. If someone is listening to the government, please, ask for this These are the rules which kill jobs. So, in our book, we have cited. There's a portfolio company of ours. Famous portfolio company. I don't have the name of the company because it will be created for them. It will be created in Noida. So, they were created in 1995.

1:44:40And now, it's a big company. It's a billion dollars market cap. But the founder was telling me when he created the firm in 1995. Around the year 2000. Because Noida is part of UP. So, a inspector came from UP. So, he said, where is your spittoon? so we didn't get into spit so I didn't get into spit and then it was violation and we should have spit in any workplace in any workplace you should have spit in the place so in India there is law that in a factory or workplace you have to have a place for people to spit and if someone doesn't eat our food that's not written in law so you didn't make spit in the law so you have to pay up a small fine so in our country in the office there are thousands of things where the whole purpose is to create some new things.

1:45:30some inspector something happens in your office. that's why I said that we will not make hot food in our office. you order it. but if you make it yourself. no, I don't have license for that. we don't have anything in the microwave. we have a non-wedge microwave. we have a hot food. we will make a kettle of tea. but you know I don't want the authority of inspector coming and saying you have to eat your food in your life license so we need you asked me for the positive this is not the fact that it was not 1880 in America to be fair probably not today I did a podcast with Sagar Wow Momos they told me that in India there are fewer licenses for for taking a gun there are fewer licenses for restaurants Wow imagine imagine in Bombay there are 70 licenses for the hotel to run in Bombay and you and I know for each of those licenses what you have to do so unless you are a big guy Taj or Oberoi right Indian hotels or such for a regular to start a 3 star hotel in Bombay 70 license 60-70 license I immediately know what that means you think you are talking to a restaurant hotel so that's why no one opens So, the one who opens is the other way around that, brother, let's see what happens.

1:46:56And then we ask why are you not making jobs? Because if you open a three-star hotel you will be difficult to open a hotel not only does that mean shortage of three-star hotels which means that room rates are$100 -$200 and$7000 -$800 where our office is in Andhiri East comfortably$100 a night is a three-star hotel. 3 star hotel 9 ,400 and that is that is Andheri Andheri East right which whilst I love the place because my office is there it's not BKC BKC in 3 star hotel there is nothing I think BKC in 5 star hotel okay so we want we want the world to come and do business we want to be competitive but hey if you want to you are a business traveler and you want to stay for less than 100 dollars a night I'm sorry this will not happen you will get to the seat or airport.

1:47:50Don't create a job. But that's the way it'll be. This sort of nonsense is what screws us. In the book, I have given a lot of cross country data. In India, the cost of land is the cost of Vietnam. It's 40 % less. In states like Maharashtra and Gujarat, the cost of industrial land is almost the same as Western Europe. right so Vietnam in the land cost 40-50 % because there's a new rule that doesn't ramp the cost of the land they figured out that if the land is less then the factory will be jobs will be made, money will be we will gain something in that cost of working capital right cost of working capital let's go 3 % in the US but it's Amir country China 3 % in the US it's a big country in Vietnam in our country you will not get 11-12 % working capital so if you have rules on regs cost of land, cost of working capital if we can address that combine that with this 1 million entrepreneurs a year so what can it be so that's why in 1991 where's Naipaul road, India a million mutinies now I was in class 9-10 I had a big deal in the country I didn't know how much I was in the country because people, million mutinators have to move forward.

1:49:16And everybody was damn angry. 1990, 1991. He goes, what the hell? Why can't I move forward? Then Banh Mohan Singh Ji and P.V. Narasimha Rao, they opened up the country. 1991. Now we have to say, million entrepreneurs are becoming every year. Those million entrepreneurs are saying, give us less red tape, give us cheaper capital, give us cheaper land. We can do what we can do. We can make a job for people. We can make a country. We are not doing that. Interesting. Well, cheaper capital is always a question of entrepreneur. Cheaper capital can be made with our podcast. But we can not make that. There are many things.

1:49:54I was speaking to somebody. I forgot. I can't remind you. I have so many people talking about this day. It's a good mix. It's a good mix. They said what they said. They said what they said. That's fine. It's a good thing. I remember the good thing. And they said that if you reduce the cost of capital, if you reduce the cost of capital, you get down to a lot of the country's upside down. It's not that you can reduce the cost of capital. It's a big deal, right? Because in today's date, where Bombay's bond market is, Andhra Pradesh State Government. Andhra Pradesh is a decent state. Andhra Pradesh State Government is borrowing 8 % in Bombay's bond market.

1:50:36So if you think that you're a small company, you're taking the state government 8%, that will take 12 to 13 12 to 13 that will take Vietnamese 13 to 13 that will take 4 to 14 that will compete so how will it do so now somebody has to go and tell our government central and state to borrow the government will borrow I will do projects like this if I don't do my impact will come from so deep I don't have an easy answer but you asked me what is the chance that we will pull off China or USA it is a chance because our entrepreneurship story is solid is very much data that is solid money and equity funding is getting decent problem is lots of rules and regs and the money and the working capital if you have to break these three steps from one to one rules and regs a half years ago in February 25th budget Nenimala Ji said that the committee will be left rules and regs to remove the rules and regs now there is not any special news so hopefully if that committee is on the work, she will finish that work and rules and eggs will be done.

1:51:44Give the cost of capital, we will take the rules. Okay, fair enough. That's a fair trade-off. That's the Cindy businessman speaking. It's easy to do. We will take a lot of things. We will take a lot of things. Well, thank you so much. My pleasure. Thank you once again. It's fun to talk to you. It's always a pleasure to talk to you. Thank you Raj. Thank you so much. this episode to end till you have to do three things. Number one, now that you have to subscribe to this channel because as much as you subscribe, we will be more valuable and better guests for you. Number two, now tell me, what did you get to learn from this episode and which guest you want to call us here and we will talk insightful to you so that you can become a better person.

1:52:32Number three, this episode must be shared with someone, to share with you because one conversation is enough for to change your life for someone's life. I'll see you next time. Until then, keep figuring out.