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Good morning. On 18th June 1980, Shakuntala Devi multiplied two 13-digit numbers and gave the correct answer in 28 seconds.

- Ruchirr Sharma & Shatakshi Sharmaa

🧵 In today’s issue

• 🤖 India's AI ambitions

• 🏢 Can India use this US IRS method to make more tax revenue?

• 🗞️ Bite-sized summaries

  • Startup blues

  • AWS to back APJ

  • Pizza coming to a neighbourhood near you

• 🧑‍🍳 What else is cookin’? (quick links)

• 🍿 Entertainment, Entertainment, Entertainment

🤖 India's AI ambitions

India is rapidly emerging as a global hub for AI, attracting massive investments from tech giants like Microsoft and Amazon. The country's vast talent pool, growing domestic tech market, and government incentives have set the stage for a transformative AI revolution.

Here’s some data: 

• Microsoft has committed $3.7B to Telangana, acquiring land to construct data centres with 660 megawatts of IT capacity. This would make India the company's largest data centre market outside the United States. 

• Meanwhile, Amazon plans to invest $12.7B in cloud infrastructure in India by 2030.

Why now?

• These investments are part of a broader race among Big Tech firms to dominate the burgeoning generative AI industry. 

• Microsoft, Amazon, and Google have collectively announced plans to invest at least $85 billion in data centre infrastructure across multiple countries, including Singapore, the US, Saudi Arabia, and Japan.

Overall: India's push for "sovereign AI" – developing its own AI systems and tools while ensuring sensitive data is processed within its borders – is a driving force behind this surge in data centre construction. 

The country's digital economy has also grown rapidly, fueled by the proliferation of smartphones and inexpensive data.

However, the environmental impact of these energy-intensive data centres remains a concern, especially in a water-stressed nation like India, where the majority of power still comes from coal. Tech giants like Microsoft are exploring renewable energy partnerships to mitigate their carbon footprint.

Read more: Financial Times

🏢 Can India use this US IRS method to make more tax revenue?

This article doesn’t exactly pertain to India, but it’s an idea I think India could greatly benefit from. 

This week, the U.S. Department of the Treasury and the Internal Revenue Service (IRS) unveiled a unique plan to crack down on a major tax loophole exploited by large, complex partnerships, bringing in more than $50B in tax revenue over the next decade.

What’s happening? 

• The primary target is a practice known as "related party basis shifting," where businesses operating through different legal entities trade original purchase prices on assets to claim more deductions or reduce future gains. 

• This tax avoidance strategy has been prevalent among wealthy taxpayers and partnerships with assets exceeding $10 million.

So what’s the solution? 

• IRS Commissioner Danny Werfel described these tactics as "tax shelters" that allow the wealthy to evade their fair share of taxes. 

• The Treasury and IRS intend to issue proposed regulations and a revenue ruling to address partnerships engaging in basis shifting without economic substance or substantial business purpose.

• This initiative builds on the IRS's ongoing efforts to increase audits on high-income taxpayers, large corporations, and intricate partnerships. 

• The move comes amid a significant rise in pass-through business filings with over $10M in assets and a steep decline in audit rates for these partnerships from 3.8% to 0.1% between 2010 and 2019.

Overall: The announcement follows President Biden's advisor unveiling tax policy plans to maintain increased IRS funding, a contentious issue with Republicans. 

The Treasury estimates the top 1% of taxpayers contribute $160 billion annually to the tax gap due to underreporting and non-compliance.

Read more: CNBC

🗞️ Bite-sized summaries

📱 No more BNPL - Apple announced on Monday that it is discontinuing its Apple Pay Later buy-now-pay-later program launched last year, which allowed customers to split purchases of up to $1,000 into four interest-free instalments when checking out online. Instead, starting later this year, Apple Pay users globally will be able to access instalment loan options from third-party lenders and credit/debit card issuers when using Apple Pay, expanding beyond the U.S.-only Apple Pay Later program. The move signals Apple's shifting strategy, prioritizing enabling secure payments through Apple Pay while leaving the lending process to financial partners, rather than directly issuing loans itself through the Apple Pay Later program.

🤑 Scholarships - K.R. Mangalam University, renowned for its academic excellence and inclusivity, is offering scholarships worth ₹21 Cr to deserving students enrolling in undergraduate and postgraduate programs this year. The scholarships range from 25% to a full 100% waiver, based on criteria like Class 12 and undergraduate scores, entrance exam results, sports achievements, and other categories. This initiative aims to make quality higher education accessible to all, irrespective of financial constraints. The university boasts an excellent placement record, international exposure through sponsored study tours to Europe, top rankings, prestigious awards, and academic partnerships with leading global companies and universities.

⛈️ Little monsoon? - India is grappling with a 20% deficit in monsoon rainfall so far this season, raising concerns for the agricultural sector that heavily depends on these annual rains. The Indian Meteorological Department reports rainfall shortfalls in most regions, with northwestern states also experiencing intense heatwaves. While some southern areas have received excess rains, central and northeastern parts of the country have seen significant deficits of up to 68%, potentially impacting crop yields. Officials remain hopeful that a revival in monsoon activity could help mitigate the shortfall. However, northern states are currently reeling under severe heatwave conditions, with temperatures soaring up to 47.6°C, 4-9°C above normal, though some respite is expected by the weekend.

🧑‍🍳 What else is cookin’?

What’s happening in India (and around the world 🌍️)

• Vivo is set to open ₹3,000 Cr India facility in July.

• Air India to start own flying school, in a first in the country.

• India is likely to add 30-35 GW of renewable energy capacity in FY25.

• Vi dials lenders for ₹23,000 Cr term loans and seeks ₹10,000 Cr in bank guarantees.

• India is one of the fastest-growing markets globally for Nestle, to focus on innovations.

• China's factory output falls 5.6% on year as housing remains a drag.

🍿 Entertainment, Entertainment, Entertainment

• T20 World Cup:

  • Bangladesh beat Nepal by 21 runs;

  • Sri Lanka beat the Netherlands by 83 runs;

  • New Zealand beat Papua New Guinea by 7 wickets.

• Euros 2024:

  • Slovakia 1-0 Belgium;

  • Romania 3-0 Ukraine;

  • France 1-0 Austria.

• First wins for Daniel Radcliffe and Angelina Jolie at Tony Awards.

• The Watches - M. Night Shyamalan’s daughter Ishana Night Shyamalan's directional debut reviews are out.