Sep 10: OpenAI's Stargate Partners In India, The Rise Of Ghost Malls

India has a new Vice President! NDA nominee (shocker) C.P. Radhakrishnan, has been elected as India’s 15th Vice President, securing 452 votes against INDIA bloc’s B. Sudershan Reddy’s 300. Now the only thing remaining is to understand what a VP actually does. Congratulations to C.P. Radhakrishnan!

Now, let’s get into the Dispatch! 🚀

Today’s reading time is 7 mins.

The Indian stock market ended in the green on Tuesday, with the Sensex and Nifty extending gains for a second day as Infosys’ announcement of a potential share buyback sparked a rally in IT stocks. 

Bengaluru’s Ghost Malls: Bengaluru, India’s tech hub and retail magnet, is seeing an unusual trend, its once-glittering shopping complexes are slipping into the category of "ghost malls," where more than 40% of retail space remains vacant. Prominent examples include the Grand Sigma Mall in Vasanthnagar, ETA Mall in Binny Pete, and Centro Mall in Bellandur. This shift comes despite Bengaluru posting strong retail leasing growth in 2024, outpacing cities like Chennai and Hyderabad. The problem lies in the inability of older malls to keep pace with changing consumer preferences, competition from newer, better-managed complexes, and the accelerating move toward e-commerce.

A New Lease Of Life: Some of these properties have already been reconfigured for new uses. The former Total Mall on Sarjapur Road now houses the offices of quick-commerce firm Zepto, while Gopalan Innovation Mall has been converted into space for VFS Global’s visa operations. Urban planners point out that such examples show the potential of adaptive reuse, where commercial spaces can be repurposed rather than left to decay. With several malls in Bengaluru struggling for relevance, it reflects a wider challenge for India’s retail sector: how to design large commercial spaces that can evolve with time and remain viable in a world of rapidly changing consumer preferences.

The Broader Trend Across India: This issue isn’t confined to Bengaluru. Across India, especially in small and mid-sized malls, the "ghost mall" phenomenon is intensifying. Knight Frank India’s 2024 "Think India Think Retail" report reveals an increase in such underperforming malls, accounting for approximately 13.3 million square feet of vacant space across key urban markets.

What The Trend Says: These trends prompt a critical reassessment of India’s retail model. Small malls must compete not only with polished, large complexes but also with e-commerce platforms that offer unmatched convenience. Without strategic planning, including financial restructuring, tenant curation, and functional reinvention, these malls risk sinking into irrelevance, dragging down the entire physical retail ecosystem. Adaptive reuse, envisioning co-working zones, healthcare hubs, educational facilities, or cultural spaces could offer a rescue path, echoing the solutions proposed and applicable nationwide.

Early Talks With Indian Data Players: OpenAI has initiated preliminary discussions with several Indian data centre operators, as part of its efforts to extend the massive $500-billion Stargate supercomputing infrastructure project into India. Discussions are focusing on key logistical considerations such as data centre capacity, geographic spread, and reliable energy availability.

Parallel Negotiations With Reliance: Alongside these talks, OpenAI has reportedly been in parallel negotiations with Reliance Industries for over six months. Reliance is currently building what it claims will be the world’s largest data centre in Jamnagar, Gujarat, making it a significant contender for hosting portions of the Stargate. The Government of India has actively encouraged OpenAI to invest a portion of the Stargate venture locally, including storing Indian user data domestically and allocating ‘a few billions’ of the project's total investment to India. Government officials view this as a strategic opportunity to anchor India's growing role in global AI.

India’s Role In OpenAI’s Global Expansion: India has emerged as OpenAI’s second-largest user market, illustrating its growing influence in the company's expansion plans. OpenAI has formally registered as a legal entity in India and is gearing up to open its first Indian office in New Delhi later this year.

Strategic Implications For India: If realized, the Stargate project would signal a landmark shift in India’s role within the AI ecosystem, positioning the country as a critical hub for advanced supercomputing infrastructure in Asia. The involvement of major players like Reliance, coupled with government incentives, reinforces the broader push for digital sovereignty and AI readiness in the region. 

Cheers to growth: Indore-based Mount Everest Breweries has acquired Cheers Breweries in Karnataka for ₹300 crore, boosting its annual capacity by 75% to 3.5 million hectolitres. The strategic move, funded by internal accruals and debt, aims to put Mount Everest Breweries Limited in 20 states by FY26 and capture about 8% of India’s beer market by 2030.

India prepares tariff damage control: India is drafting a relief package for industries affected by the US’s steep 50% tariffs on Indian steel and aluminium. According to Joint Secretary Vimal Anand, the Commerce Ministry is consulting stakeholders to address shocks to cash flow and competitiveness. The measures will include working capital support, export facilitation, and potential adjustments to duties and taxes.

AI-led taxmate: PwC India has launched the GenAI Navigate Tax Hub, a platform using generative AI as part of its Vision 2030 initiative to modernise tax and regulatory work. The platform, built with content partners like Taxsutra, supports in-depth research, drafting legal submissions, creating SOPs, and planning complex transactions.

Jio X Allianz: Jio Financial Services (JFSL) and Germany’s Allianz have formed a 50:50 joint venture, Allianz Jio Reinsurance Ltd (AJRL), to enter India’s reinsurance market. The partnership combines JFSL’s local and digital expertise with Allianz’s underwriting and global portfolios, building on Allianz Re’s 25+ years in India.

Hiring outlook trends: Corporate India's hiring outlook (%employers who expect to hire minus those who expect to fire) for the October-December quarter is at 40%, a decrease of 7% from the previous quarter but an increase of 18% year-over-year. The survey of 3,149 employers shows India is ranked second globally on employment outlook, only behind the UAE. Employers are focusing on flexibility, using a mix of permanent, temporary, and consultant talent to remain agile.

GST 2.0 jitters: The FMCG industry is preparing for a "choppy" transition to GST 2.0, with new tax rates of 5% and 18% (and 40% for sin/luxury goods) taking effect on September 22nd. While this is expected to boost volumes, the shift will cause short-term disruptions related to pricing, invoicing, and inventory. To pass on benefits, brands are considering increasing grammage in ₹5–₹10 packs and making selective price cuts on larger items, but these changes may be delayed by 4-5 weeks at the retail level.

Nepal Burns: Nepal has been gripped by one of its worst political crises in years after violent protests forced Prime Minister K.P. Sharma Oli to resign. The unrest was triggered by the government’s sudden ban on major social media platforms, including Facebook, WhatsApp, Instagram, YouTube, and X, a move widely seen as an attempt to curb dissent. The ban struck a nerve with young Nepalis, already frustrated by corruption, unemployment, and shrinking freedoms.

Protests Turn Deadly: The demonstrations, led largely by Gen Z youth, quickly spiraled into nationwide unrest. At least 19 people were killed and over 100 injured as security forces clashed with protesters. In Kathmandu, angry crowds torched the prime minister’s residence and set fire to parts of parliament. Political leaders and ruling party figures were attacked, forcing authorities to impose a curfew across the capital and several districts.

Army Steps In: With the civilian government weakened and police overwhelmed, Nepal’s army has taken charge of maintaining order. Military officials issued a public appeal for calm and cooperation, assuring citizens that their intervention is temporary and aimed only at stabilizing the situation. President Ram Chandra Poudel has urged all parties to engage in dialogue to prevent further escalation.

France’s PM Bayrou Resigns: France was thrust into fresh political turmoil after Prime Minister François Bayrou was forced to resign on Monday following a stinging defeat in a parliamentary confidence vote. Bayrou lost the ballot by 364 votes to 194, becoming the country’s fifth prime minister to exit in less than two years. He is expected to tender his resignation to President Emmanuel Macron immediately.

Austerity Gamble Backfires: Bayrou’s downfall came after he unexpectedly called a confidence vote to push through sweeping austerity measures aimed at reducing France’s public debt, which has swelled to €3.4 trillion. His plan included scrapping public holidays, freezing welfare payments and cutting pensions in a bid to save €44 billion. The move backfired, uniting opposition parties from the far-left to the far-right. Critics accused him of “political suicide,” arguing that voters were far more concerned about inflation, immigration and security than debt levels.

Macron Faces Limited Options: The resignation leaves Macron facing a delicate political balancing act. He can appoint a new prime minister, with Defence Minister Sébastien Lecornu and former minister Catherine Vautrin among the names floated, or he could dissolve parliament and call fresh elections — a risky step given rising public anger. Meanwhile, a growing protest wave dubbed the “Block Everything” movement is gathering momentum. Echoing the Yellow Vest unrest of 2018, unions and activists have rallied under its banner, with 80,000 police deployed nationwide. Organisers have announced major demonstrations for September 10 and 18.

Markets React Cautiously: Financial markets have reacted cautiously. The CAC 40 index rose slightly on Monday, while bond yields ticked higher. However, rating agency Fitch is expected to review France’s credit outlook later this week, raising concerns about the fiscal path ahead. With mounting street anger, a fragmented parliament and economic strains, France risks sliding into another prolonged period of instability. 

US Firm’s Pakistan Mineral Deal: US Strategic Metals has struck a $500 million agreement with Pakistan's Frontier Works Organization to develop the country's critical minerals sector, targeting resources like gold, antimony, rare earths, and copper. The pact, part of broader foreign investment efforts, includes setting up a poly-metallic refinery and expanding mineral processing capacity. The U.S. Embassy hailed the move as a boost to bilateral economic ties.  

Intel Overhauls Leadership: Intel is undergoing a major executive shake-up under CEO Lip-Bu Tan, with Products Chief Michelle Johnston Holthaus stepping down after over 30 years and transitioning into an advisory role. The changes are part of Tan’s strategy to streamline the leadership structure and enhance operational efficiency.

Nebius Deal With Microsoft: Nebius Group has signed a landmark $17.4 billion agreement with Microsoft to provide GPU-based AI infrastructure over the next five years - a deal that could scale to $19.4 billion if demand increases. The news sent Nebius shares soaring up to 55% in after-hours trading. The arrangement positions Nebius, spun off from Yandex, as a rising AI “neocloud” contender.

The succession battle that inspired ‘Succession’ concludes: The Murdoch family finally settled the succession dispute with Rupert Murdoch's eldest son, Lachlan Murdoch, securing control of the family's media empire, including Fox News and The Wall Street Journal. This ends a prolonged family dispute.

Sweden’s AI Music Licence to Safeguard Songwriters' Rights: Sweden's music rights organization, STIM, has unveiled a new licensing framework that permits AI companies to use copyrighted songs for training their models, provided they compensate songwriters and composers. This initiative addresses growing concerns over AI's impact on the music industry, aiming to ensure fair remuneration for creators.  

Team India’s Triumphs: The Indian women's hockey team defeated Singapore with a dominant 12-0 victory in a Pool B match of the Asia Cup in China. Navneet Kaur and Mumtaz Khan both scored hat-tricks, contributing to the decisive win.

New Vadilal CEO: Vadilal Industries has appointed Himanshu Kanwar, a former Unilever executive, as its first non-family CEO. This move, which follows a major family settlement and restructuring, aims to shift the company towards professional management.

BRICS Trade Tensions: India is urging fellow BRICS members to address trade deficits, with its own deficit with China hitting a record $99.21 billion in fiscal year 2025. This comes as the bloc, including Brazil, rallies against U.S. President Donald Trump's new tariffs, with levies as high as 50% on some goods.

THAT’S ALL FOR TODAY!

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