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QUEST MEANS BUSINESS
Cameron, Hollande Meet Ahead of Euro Summit; Laser Forces Virgin Flight Back to London; Indian Stocks Stage Biggest Rally in a Year; Indian Stocks Struggle Despite GDP Growth; CISCO Chairman: India Can Change the World; Jammed Packed Commuting in New Delhi; Kanye West Tweets He is $53 Million in Debt
Aired February 15, 2016 - 16:00:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, HOST: It is a glorious evening here in Mumbai. With U.S. markets closed for President's day, there's no trading in the U.S., the
rest of the worlds on a rally. And it is Monday, the 15th of February.
Tonight, India's finance minister tells me the country can become the world's global powerhouse. You'll hear him live on Quest Means Business.
(BEGIN VIDEO CLIP)
QUEST: Don't wait up. Mario Draghi says he won't hesitate to add more stimulus. And concern in the cockpit; lasers shone at the pilots force the
crew of the plane to abandon the flight.
(END VIDEO CLIP)
QUEST: I'm Richard Quest, CNN's - CNN money's new editor at large, tonight in Mumbai where of course I mean business.
Good evening, before we begin with our digest from Mumbai, let me start with some news about CNN and ourselves, and the launch today of CNN Money
as a new global brand to deliver to you on mobile, online, on television, wherever you need it, however you want it, we're going to give you the very
best in business coverage.
(BEGIN VIDEO CLIP)
QUEST: As of Monday, that's now, Quest Means Business and the rest of the CNN money team will bring you the latest in business wherever you are.
CNN's business coverage is now bigger and better than ever before. Each night, we are going to be delving into the arsenal of what is moving the
(END VIDEO CLIP)
QUEST: And giving you the various ammunition that you need to make decisions to help your own profitability. So for instance tonight is no
exception. Look who we got.
(BEGIN VIDEO CLIP)
QUEST: We have our Europe editor, Nina dos Santos on Europe's banking jitters. Our emerging markets editor John Defterios, on the falling price
of oil. Our Asia-Pacific Editor, Andrew Stevens on how it impacts China. And our business correspondent Samuel Burke on Kanye West's latest money
(END VIDEO CLIP)
QUEST: Let's begin though here in Mumbai and in India.
India's Finance Minister in just a matter of weeks will present his latest budget. It is a crucial budget for economy that now the fastest growing
economy in the world. 7.3% in the last quarter. But there are serious worries about India's ability to continue that rate of growth. And whether
the reforms of the current Prime Minister Modi, will be stalled and the country will go into reverse. I spoke to India's Finance Minister, and I
asked him how he was going to keep this economy moving.
(BEGIN VIDEO CLIP)
ARUN JAITLEY, INDIAN FINANCE MINISTER: I think it's the unpredictability and the volatility which is throwing up a challenging situation. We've seen
the world where you had once in several years a crisis of sort. And today you almost are learning to live with volatility almost by the day. You have
unpredictability and therefore it's a great challenge for economies like ours that we try and stabilize our eternal systems to an extent that we can
withstand all these global pressures.
QUEST: That volatility is now threatening India's growth.
JAITLEY: Well, I would say if I look at it in the context of the whole world, we've been able to show a tremendous amount of resilience. And
compared to what's happening elsewhere in the world, we've been able to use the current situation significantly to our advantage. But if I look at
India in absolute standards of India itself, I do believe we can do better.
QUEST: With that in mind, and I know you've got a budget coming up and I'm guessing you're not going to give me much hint of which way you're going to
do, but your budget is going to clearly have to accommodate these realities.
JAITLEY: The realities present a mixed bag. They present a mixed bag because on one hand because of low commodities, metals, oil prices, there's
a lot of savings we can do. We can channelize that savings into the social sector, we can channelize those savings into infrastructure. At the same
time, there are adverse global trends which impact on exports, which impact on markets, which impact on currencies.
QUEST: So you - when we talked in Davos, you said that you know, ultimately the low oil price was a win for you. Do you still hold that view?
JAITLEY: Well, the low oil price certainly has given us an opportunity and a resource at our advantage. But at the same time, it's also accompanied by
a global mood which is adversely impacting on markets. It's also brought a situation where a slow global trade which is shrinking itself has its
adverse impacts on every country in the world.
QUEST: So finally sir, if your message would be to business leaders here, obviously stay the course, don't let the current relatively temporary
environment blow you too far.
JAITLEY: Well, I think - I think 2001, 2008, 2015 are all testimony to the fact that India has a resilience to withstand many of these global
challenges and we've done it many a time in the past. I'm quite certain we'll do it. It's certainly a much better place to invest in compared to
any other economy in the world today.
(END VIDEO CLIP)
QUEST: That's the Indian Finance Minister talking to me at the CNN Asia business forum over the weekend. India's Prime Minister however says that
while growth in the rest of the world is slowing, in Indian, it is accelerating and that is likely to continue. Even suggesting that the
Indian economy could be the powerhouse and engine of growth for others.
After months of volatility here in India itself, the market has also turned into a bear market. And there are questions about whether India, though, is
the last remaining country of the BRICs.
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QUEST: Emerging market growth once fueled by BRIC economies. The plunging price of oil which is hurting Brazil and Russia, both of those countries
are currently in recession. Whilst India moves ahead.
So the latest thinking is out with the BRICs, in with the TICs. You take India, you add in Taiwan and South Korea and you have a new emerging market
growth engine built on the back of technology and innovation.
Do the TICs take over from the BRICs? Joining me is Sajjid Chinoy, of JP Morgan, Chief economist here in India.
(END VIDEO CLIP)
QUEST: BRICs or TICs? Are the BRICs dead, long live the TICs?
SAJJID CHINOY, JP MORGAN CHIEF ECONOMIST: Well it is the TICs right because India is a large commodity importer. As long as commodity prices are
contained, oil prices are falling, that's a massive positive terms of trade shock that's driven India. The challenge is, that's a one off temporary
windfall of income you've got. And as that grows off in the next year or two, what other sources of demand will replace the windfall from oil in
QUEST: So when Arun Jaitley says you know India's doing well, the Prime Minister says India's doing well, and yet others say this growth number is
if not fictitious is not -- is partially illusory. Do you buy it?
CHINOY: Well I think both things are true. India has been accelerating even as other emerging markets have been slowing. But a lot of this
acceleration has been on the back of the collapse in oil prices, which is a temporary boost to growth. The challenge will be next year when all prices
flat line, the dividend from oil goes away and other drivers of growth must kick into India.
QUEST: This whole concept of India and the renaissance, the make in India, the entire idea of this country being a powerhouse, I'm getting the feeling
you don't buy it.
CHINOY: You know, you have to be agnostic that in this world where there's so much excess capacity, manufacturing you still have China, global trade
is shrinking, can India be the next powerhouse, in the next year or two? Unlikely. But what (inaudible) India does is create the focal point to do
all the good things we should be doing.
QUEST: If it can do it - if it can do it - I mean you know look, I'm slightly -- I'm not cynical, I'm slightly skeptical. The history of India
is it runs a good race and runs the final hurdle.
CHINOY: That is true but the fact is also true that this government's very good in mission mode. So if we can create a focal center to push
infrastructure, labor reform, education, whether that demand is consumed externally through exports or domestically in India, it doesn't matter.
What matters is India becomes more competitive and productivity growth down the line will pick up. Even if some parts of making India are pushed
QUEST: So give our viewers a feeling on the question, the raw question of optimism versus pessimism, skepticism versus cynicism.
CHINOY: Well, I'm a realist, and I think in economics --
QUEST: Oh, realism.
CHINOY: and I think in economics there are no corner solutions. India's had good policy and good luck. The good luck at some point will wear out as oil
prices flat line. I think the government's heart is in the right place. There's been a big push in public investment. And we are looking to this
budget to provide the road map for the next set of reforms that replace the dividend from oil.
QUEST: This gentleman, I have to tell you, 20 to 3:00 in the morning, this takes courage, bravery and jolly good chat, thank you for joining us this
I'm not sure I'd turn up at 20 to 3:00 in the morning, well I did didn't I but you know what I mean. As we continue, there was a magnificent rally on
the markets. It wasn't illusory. Very strong gains were seen in Tokyo and in Europe.
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QUEST: No trading in the U.S. but we'll get the perspective on why that was such a strong day. Quest Means Business.
(END VIDEO CLIP)
QUEST: Welcome back to Mumbai. Quest Means Business in the fastest growing economy on the world, on the day we launch the global brand of CNN Money.
Now stock markets, there was a remarkable rally; the fears from China having been closed for a week for the holiday simply didn't materialize
when everybody else opened. China did have a wobble but there was an impressive performance from all the other major markets.
Wall Street is closed of course for today. Appropriately with an election around the corner, it is the President's day holiday.
(BEGIN VIDEO CLIP)
QUEST: The Nikkei in Tokyo rallied 7% and that was despite the fact the GDP numbers showed that Japan not in recession but actually was negative in the
fourth quarter and a very weak GDP. The Nikkei still down almost 16% so far this year. Monday's rally helped by the falling Yen.
As for the European stocks, they made strong gains for a second straight session.
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QUEST: A Reuters report said the ECB might help mop up billions of dollars of bad debts that are now weighing down on the global economy and on the
Mario Draghi was giving testimony before the European parliament when the President of the ECB gave a global overview. And whilst not pessimistic,
certainly made it clear that there were serious head winds that the ECB was now having to counter.
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MARIO DRAGHI, PRESIDENT EUROPEAN CENTRAL BANK: In the light of the recent financial turmoil, we'll analyze the state of transmission of our monetary
policy impulses by the financial system and, in particular, by the banks. If either of these two factors can take down the race to price stability,
we will not hesitate to act.
(END VIDEO CLIP)
QUEST: We will not hesitate to do what needs to be done. Now, this isn't the first time Mario Draghi has said this. In many ways, it keeps turning
into a version of whatever it takes. Nina de Santos, our European editor, is in London. What did you make of what he said?
NINA DOS SANTOS, CNN EUROPEAN EDITOR: Well, it's not the first time we've heard that from Mario Draghi, is it? You and I know this very well,
Richard. It's a particular refrain that he's been uttering many, many times since he took the helm at the ECB about four or five years ago.
(BEGIN VIDEO CLIP)
DOS SANTOS: Saying that he "is ready to act."
Now the thing is, he already has acted a few times and that has brought interest rates across the single currency area into the negative territory.
This is something that the ECB has in common with the Bank of Japan.
DOS SANTOS: And the other big story today was, as you were just mentioning before, Richard, the Bank of Japan stimulating people to expect more
stimulus, because the GDP figures for Japan came in lower.
(END VIDEO CLIP)
DOS SANTOS: The markets just reminded us that bad news economically is often good news for markets because it means central bankers are willing to
press the button and print more money or to cut rates even further into negative territory.
Now we have this situation Richard, where we have four major central banks around the world. The ECB, the Bank of Japan, Sweden Central Bank, the
(inaudible) and also Switzerland Central Bank having rates in negative territory. The real risk many people are saying now is that policymakers in
some central banks don't have much left to use in their toolkit if things get really nasty in a year from now, if we do see the economy hitting the
For this reason, Jim Rogers, the veteran investor was telling me on my show several hours ago as we launched CNN Money both online and also on T.V.,
Richard, he was saying the central bankers have lost the grip of this situation here. They have lost their credibility.
Now, many market investors I've been speaking to are saying that they have now upped their chances of Mario Draghi cutting into negative territory on
March the 10th when we have the next ECB meeting. But the real problem from here is it's awfully difficult for banks across this region to make
money when they actually have to pay money to park it with the ECB.
QUEST: But Nina, what is the preferred solution for the ECB when it next meets? Is it further into negative interest rates? Is it more q/e? Is it
extending the range of q/e? What is the -- what are you hearing is the likely move forward?
DOS SANTOS: Well, the reality is, Richard, it may well be a combination of all of those three factors. As you hint quite rightfully, they have
extended bond buying programs. They tried to buy more assets across a single currency area. They're now even talking about, as you were saying in
your introduction, helping some of the Italian lenders that have been really badly bruised and battered in the markets over the last month or so
by mopping up their bad loan books.
They can do a lot things because, remember that of course, the ECB's inflation target is 2%. Their inflation currently stands, at 0.4% so well
under a quarter of the actual target it needs to be at. And then remember we have the deflationary pressures. So prices coming down from things like
oil. So that will continue to be a status quo that Mario Draghi will have to deal with for the next few months to come. These are all things he's
likely to bring up when he has that March the 10th meeting. Which by the way Richard, will also include his inflation report.
QUEST: Nina Dos Santos and congratulations to you, Nina, on this day, as you become our Europe Editor based in London, part of CNN Money.
Quest Means Business. We are in Mumbai as we continue.
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QUEST: After the break, the UAE's Foreign Minister in an exclusive interview tells us why he is backing India as a global growth machine and
of course we talk oil. Good evening from Mumbai.
(END VIDEO CLIP)
QUEST: Welcome back to Mumbai. The UAE's Minister of State for Foreign Affairs in an exclusive interview tells CNN, tells John Defterios that his
country is backing India as one of the global powerhouses of the future. By way of context, UAE had an official delegation here in India earlier this
week. Our emerging markets editor John Defterios is in Abu Dhabi this evening, good evening John.
JOHN DEFTERIOUS, CNN EMERGING MARKETS EDITOR: Hi, Richard, nice to see you. Indeed India's growing fast and so too is this demand for crude
Richard. Believe this number or not, 20% a year. Right now India imports about 4 million barrels a day. That's about half of level of China. But the
UAE has less than 10 percent of the market and that is about to change after a high-profile visit as you suggested by the crown prince of Abu
Dhabi, Mohamed Bin Zayed al Nahyan and his Minister of State for Foreign Affairs, Dr. Anwar Gargash. It's all part of the UAE's silk road strategy
announced about a year ago and India is at the heart of that strategy. Let's take a listen.
(BEGIN VIDEO CLIP)
ANWAR MOHAMMED GARGASH, UAE MINISTER OF STATE, FOREIGN AFFAIRS: I think we have you know, a great faith in India's economy and the size of the economy
and the liberalization of the economy and the restructuring of the economy. So it is a stretch target I agree but I think it is achievable.
DEFTERIOS: Now about 300,000 barrels a day. So at the core of this relationship is a bilateral trade in energy. But that can go much higher, I
would imagine, as India grows.
GARGASH: Yes, that can go much higher. And there are many, many other areas to explore also in the oil sector. Among them of course the strategic
reserves greater, you know, sales of UAE oil to India, down streaming, et cetera. So this is definitely an area of many, many areas and what I would
say a very diversified relationship.
DEFTERIOS: How do you manage this fact that India's maintained relations with Iran during the sanctions? Doesn't it get politically tricky when
India's maintained those relations with Iran and the Gulf States have taken a much more tepid approach about this opening than we see today?
GARGASH: What we are moving towards in India is a frank and transparent dialogue where we understand India through direct dialogue and they
understand our views through direct dialogue and this includes also our reservations on Iran's regional policy in the region.
You know, we're speeding and they're speeding and we're very, very confident that our understanding of India's concerns and challenges is
much, much better and much more - much more crisp and transparent and we feel the same way the other way.
DEFTERIOS: You have a very defined foreign policy on the Silk Road now going all the way to China. How does Iran fit into that strategy? Will you
have engagement going forward and try to tackle the military expansion or the foreign policy influence of Iran in the region?
GARGASH: I think the natural rhythm of the relationship with Iran should be a relationship of two neighboring countries. Not only ours but Iran and the
Arab world. I think what is undermining that is basically, you know, Iran's regional policy and its interference in the Arab world.
We will be one of the most countries that will be supportive of Iran acting as a normal state that is noninterfering in affairs of its neighbors and
respecting their sovereignty. That's the way it should be.
(END VIDEO CLIP)
DEFTERIOS: Once again, Dr. Anwar Gargash, the minister of state for foreign affairs here in the UAE. This engagement with India as you can see Richard,
goes far beyond just crude and includes high stakes, geopolitics and oil. And Richard I think you'll like this fact to it in particular. How close
the aviation ties are between the UAE and India right now. There are more daily flights through Dubai and India than any other destination from that
country. And as you can see right now they're going to go into geopolitics, go into trade which is already a bi-lateral trade agreement of
$60 billion fostered particularly in the last five years.
QUEST: John Defterios who's in Abu Dhabi this evening. One of the reasons for those aviation links of course is the Etihad tie out with Jet Airways
has more than something like 20 odd flights 21/22 flights a day between various gateways in India and Abu Dhabi.
The issue of oil is front and center in the global economy. So to put it in context, I was joined by our Asia-Pacific editor Andrew Stevens and Fareed
Zakaria, the host of "GPS." two men who can make me understand or at least help us all understand why this low price of oil is so worrying.
(BEGIN VIDEO CLIP)
FAREED ZAKARIA, HOST CNN "GPS": There are two problems. It's falling so far so fast, it's producing a ripple of political instability. So for
example, Venezuela is going to implode. It's going to default on their debts. It's going to produce repercussions as people hold that debt.
Venezuela is a small country. Brazil will probably implode at some point.
If you look at what's happening in Iraq. Iraq is probably going to fall apart and Nigeria. All these countries where oil is 50, 60, 70% of
government revenue, are all of a sudden facing a fiscal nightmare.
QUEST: That's their problem, they ran their economies badly.
ZAKARIA: Guess who loaned them the money, western banks. In the United States, we often forget the United States is the largest producer of liquid
hydrocarbons in the world today. There is a lot of credit tied up with that. That's unwinding. It's short-term choppy. In the long run, we'll have
- we'll have cheap gas. But as (inaudible) said in the long run, we're dead.
ANDREW STEVENS, CNN ASIA-PACIFIC EDITOR: Yes, well I think from the perspective of China, it is the biggest importer of oil now. But I think
generally yes, it's choppy initially, but there's such an upside for China. And you know China is still importing a lot of oil. It's filling its
strategic reserves hugely.
QUEST: Yes, but hang on, that filling of the strategic reserves, there's about a 1.6 million barrel a day excess of supply over demand that's going
into storage that can't continue.
STEVENS: Well, the storage is growing. The Chinese are adding another big four storage fields. They're trying to get to 100 days of strategic
reserves. At the moment, they've got 29 days so they've got a long way to go. And as we know about China if they want to do something, they do it and
they do it quite quickly.
ZAKARIA: For China, India, Indonesia, this is only good news. But there's a lot of the world outside.
QUEST: Well, except as the dollar has risen, on the back of the falling oil price, so those countries with dollar denominated debts are going to feel
the problem as well aren't they. And eventually this whole circular argument becomes a downward spiral.
ZAKARIA: Yes, but China doesn't have dollar denominated debt, neither does India. So these are large internal economies where they have been, for the
Indians for example, their fiscal situation has been dramatically improved. I think they've gotten a $10 billion windfall because of this.
STEVENS: And I think the Chinese don't see this as a major problem. What we're seeing at the moment in China is a slowly devaluing currency against
the U.S. dollar so there is that concern. But really just coming back to the central tenet of cheap oil, as Fareed says, and I agree with him, it's
generally a win-win for China. They need, as we now know, they are changing their economic model, they're looking for more consumer-based growth. Just
let me finish, they're getting that, for example, car sales are going much, much higher because oil is getting cheaper, little things like that.
Production costs are going down on consumer goods.
QUEST: We end up in the United States with a 300% increase of bankruptcies of oil companies. Admittedly, many of them are small in Texas or up in
North Dakota, in the Dakotas around the permeable, the back and basin, but eventually, doesn't this become you know the traditionally sweater that's
got a snagged thread that unwinds?
ZAKARIA: Unravels? Well it's an interesting -
ZAKARIA: Well it's an interesting -- it's an interesting question because the U.S. is this huge producer but the American economy is so large so
diverse, oil makes up in total - oil and natural gas maybe 9% of U.S. GDP. There is credit but it's not the same as housing. Everybody doesn't own
credit that is related to energy. The U.S. can take pain better than almost any economy in the world. So yes, there will be pain but it's a big vast
diverse economy, it will bounce back.
STEVENS: I think what you were saying earlier about the economies of Southeast Asia, and the rising dollar. Yes there are issues there. With
Thailand, we saw in the Asian financial crisis obviously we have a strong dollar and weaker --
QUEST: You've got Azerbaijan and Kazakhstan going to the IMF for bailouts.
ZAKARIA: And Nigeria. See, the problem is really I think not so much the economic piece of this but what does the - what does the politics look
like? So China, it's all looking good, but china's neighbor Russia, one- third of --
STEVENS: These are peripheral countries, Richard.
ZAKARIA: Russia is not a peripheral company. It's got 3,000 nuclear weapons, it's got a seat on the Security Council. And Russia needs oil at
$100 a barrel to balance its books.
QUEST: It's not going to get it. And if it's not going to get it, is the biggest crisis in this oil debacle social unrest and the geopolitical
ZAKARIA: Well put it this way, the last time oil fell so far, so fast, the Soviet Union collapsed and the Cold War ended.
QUEST: Fareed Zakaria, Andrew Stevens, all giving us a perspective - perhaps somewhat pessimistic, when you think of the ramifications and the
consequences of the last time there was a major oil crisis.
Quest Means Business from Mumbai. As we continue, another plane gets attacked - there is perhaps no other word - by a laser from the ground.
And this time, the flight has to be abandoned
We'll talk about that, after the break.
QUEST: Hello. I'm Richard Quest. There's more Quest Means Business in just a moment, when we'll hear from John Chambers, the executive chairman
of Cisco, about why Cisco is doubling down on its bet on India.
And Kanye West tells us, or at least we hear about why he has an original way of going for crowd source funding.
For all of that, though, this is CNN. And on this network, the news always comes first.
Lynda Kinkade has the headlines.
[16:35:00] RICHARD QUEST, CNN ANCHOR: Virgin Atlantic says a laser pointed at one of its planes, the VS-25, forced the pilots to turn round
after one of the pilots reported feeling unwell having being hit by the effects of the laser. The jet was bound for New York. It had got as far
as the west coast of Ireland when the pilot flying made a pan, pan announcement, which is an urgent call, not a mayday, but basically saying
the plane was in a difficult situation.
(BEGIN VIDEO CLIP)
PILOT: We're going to have to declare a pan and go back to Heathrow. We have a medical issue with one of the pilots.
AIR TRAFFIC CONTROL: Two, five, bravo say all that again.
PILOT: Pan, pan, pan, Virgin two, five, bravo, pan. We have a medical issue with one of the pilots after a laser incident after take-off and
we're going to return to Heathrow.
AIR TRAFFIC CONTROL: Left turn direct to Strumble is approved.
(END VIDEO CLIP)
QUEST: The plane then continued back to London Heathrow where is landed safely. All passengers and crew where OK. The issues of course is very
serious. It's not new, but it seems to be getting worse. Patrick Smith, is a former commercial pilot, he writes for the askthepilot.com column. He
joins me now. Patrick we've known about this laser issue, but this is one of the most serious that I can remember as it relates to a commercial
PATRICK SMITH, WRITES FOR ASKTHE PILOT.COM: It is Richard, and as you pointed out this isn't a new phenomenon. This has been with us for a
better part of 10 years now. But the numbers do seen to be going up and I think it's really just a matter of proliferation. There are just more of
these devices in the hands of more people.
And I don't think that there's nefarious intent. I mean we have a tendency of view everything through the crucible of terrorism, and people
intentionally trying to interfere with a commercial flight. I don't think that's what this is by-in-large. It's more just people being
irresponsible. Particularly younger people who don't realize that these devices can temporarily blind a pilot and are therefore potentially quite
hazardous. And because this is an awareness issue and a responsibility issue, I don't think it's something that we can - I don't think it's a
problem we can regulate away. I think it's ultimately going to come down to people just realizing what these devices can do and being more
responsible with them.
QUEST: Right. But here's the point, Patrick, if you're talking about relying on education and that's a long term effect, does there also need to
be an element of deterrent. I lock up some people when their caught having done this.
SMITH: Sure, I think stiffer penalties is for using these devices. That's something that definitely needs to be looked at. I don't know how much of
a deterrent that is though if you're somebody who doesn't know these devices are a hazardous as they can be. I mean, you know if you think
about it, it's human nature. If you've got one of these things, you know, something flies by you, you point it at it. And you know, that's just
people being people and just not knowing better. And that's what has to change.
QUEST: Patrick we have joining us from the U.S. with the laser story, we'll talk more about that. Patrick, thank you, always good to have your
analysis on these stories. When we come back one of America's top chief exec's or former chief exec's, now Executive Chairman, John Chambers gives
us why he so bullish about India.
[16:36:00] QUEST: The Indian stock market rallied quite sharply on Monday. And yet it's still in the bear market territory as they say, down
more than 23 percent since it's resent high in 2015. The Sensex now finished more than two percent higher. It's the biggest one day gain since
January of last year. It's around 10 percent off year-to-date, so I needed to find out the irrepressible, the emollient, the ever enthusiastic
independent traders that stand outside the market. What they made of India's economy and the fact that they were now taming a bear.
QUEST: The Bombay stock exchange the thriving heart of the commercial center in this city. And a market that is being hit and pummel like every
other. Bombay has just suffered one of its worse weeks in years. The market is now down 11 percent year-to-date and officially since its recent
high is off 20 percent. Yup, Bombay has joined the bears. And yet India with a growth rate of 7.3 percent is one the fastest growing economies and
most vibrant in the world. So around the market here is the perfect place to talk to the traders to see what they think about India and Bombay's
What's happened this week? What has gone wrong?
UNIDENTIFIED MALE: OK. It was largely due to the external factors and less concern with the Indian economy. So I feel that thing are not bad as
they are conceived to be out here.
QUEST: Tell me about how strong do you think the Indian economy with the Modi reforms actually is?
UNIDENTIFIED MALE: OK, it will take time because whatever he has to deliver, it cannot be delivered overnight. Let the budget come. What is
he delivering in the budget this time? I don't know how crucial this budget will be.
QUEST: I hear the people are getting frustrated. They're getting worried.
UNIDENTIFIED MALE: No, no, no. It will all take time. It will take time. It is buying time now.
QUEST: With the market down 23 percent from it's high. Down 11 percent for the year so far, are you seeing distress selling yet.
UNIDENTIFIED MALE: Yes. To whatever extent, yes, but the fundamentals are in place. You need to give Modi time to deliver. You need to give him at
least one term of five years to deliver.
(END OF VIDEOTAPE)
QUEST: The traders outside the stock exchange, it's not only an opportunity of growth that lies with Indian, it is an obligation to change
the world. That is the view of John Chambers, the former chief executive of CISCO who is now the Executive Chairman. He explained to me why CISCO
is doubling down on its bet on this country.
JOHN CHAMBERS, EXECUTIVE CHAIRMAN, CISCO: This country has a view of how this digital era is going to exist for the next few decades. Will be five
to ten times what the information era that the U.S. capitalized on and President Clinton did so well. So you've got a leader I believe in.
You've got a young population that I think can change the world.
QUEST: The can, but will they? Because this country also, as you know, is an entire history of potential and failure to deliver or execution.
[16:40:00] CHAMBERS: Well it's going to be an interesting fact Richard, I going to come back in one and two years with you and I believe that in that
time period you'll see India leapfrog its peers. And you'll see a country which is traditionally to your point, one that was a slow follower, become
a very fast innovative leader.
And when you have a leadership that is able to pull it together. He doesn't talk about making Indian separate from skill India, separate from
startup India, separate from environmental India. He talks about how you bring it together with smart city. He talks about how you reeducate the
population. He had add one to three percent grown to their GDP.
QUEST: What worries you about India in the sense of infrastructure. It's fine to have all these startups, to have these great companies, but if you
can't execute it through the economy and he's having difficulty doing that.
CHAMBERS: Well first of all you're trying to move the biggest democracy in the world, 1.3 billion people. And you've got to turn it like it's a PT
boat. The key issues are you've got to build out broadband faster. You've got to knock down, make it an easier place to do business. You've got to
remove the issues, for example, on making India it terms of the key issues on cost imparity and taxes. They're making very good progress on it all,
Richard, so I'm going to bet on the country in a big way.
Will there be set back along the way? Of course.
QUEST: And on the U.S. Presidential Election. Honestly a Republican that you are, how are you looking at the field and are concerned at what you're
CHAMBERS: I am concerned, but on an area that may surprise you. Every major country in the world, whether it's India on a digital India, whether
it's France on a digital France, where CISCO's partner with across the board with President Hollande. Cameron and his innovation in U.K. Merkel
and her Industry 4.0. Renzi and how he's going to connect his country. We are the only major country in the world, with the exception of Japan - and
I'm meeting with Abe next week on this topic - that does not have a national digital agenda. That needs to be a part of every single one of
our candidates and they aren't even talking about it. So I'm disappointed. There's no entitlement in this new race. We led an information age. A
Democrat, President Clinton generated the information age in many ways for the U.S. Eighteen percent growth in GDP, 17 percent growth in per capita
income, 22.5 million jobs. We aren't even talking that.
QUEST: Do you see the next 12 months as a sort of go nowhere, move sideways, in the business world, as business waits to see who the next
president is, and therefore what policies will be introduced. In other words tread water.
CHAMBERS: I think that would be a fatal mistake by businesses. Any company who doesn't change dramatically in the next 12 months the games
over for them. It's a digital world. Every country, every city, every company, every person, those who tread water will get left behind,
including countries. That's why I'm so bullish on India coming all the way around. Prime Minister Modi gets it. Will he make some mistakes along the
way? Of course. But this is where the business community, the citizens of India, all the political parties should come together. India has the
opportunity and I would argue the obligation to both change India and then help to change the world.
QUEST: John Chambers of CISCO. There is one story that any visitor from India, to India immediately feels and goes home and talks about. And that
is the appalling level of traffic. Those who live there have got used to it. They give you a wry smile when you complain about the length of a
commute. Just to get a couple of kilometers can take up to an hour. Sumnima Udas in New Delhi has been discovering why it's so bad.
SUMNIMA UDAS, CNN CORRESPONDENT: Delhi traffic, not the ordinary stop and go rush hours log jam common in cities like New York or Los Angeles. This
is mayhem of another kind. So I'm trying to get to old Delhi which is really the heart of business in the capital. And to do that I need to find
a black cab.
There are hundreds of them here, yet finding one is difficult. The drivers try to bargain. No one wants to take me the legal way, using a meter. So
I keep looking. And finally.
Bargaining early in the morning, great way to start your day. In a city jammed packed with 25 million people, 8.5 million cars, and all the other
inhabitants getting round is never easy.
We're not moving it's been about an hour now and we are stuck. The driver tells me he can't go further and I need to take a rickshaw. Crossing the
road is a feat in itself.
There is no real road etiquette here and rush hour is every hour. I've got a two lane road, but you've got motorcycles, rickshaws, trucks, carts,
everything trying to jam into this tiny space all at the same time.
Once again more bargaining, and we are off.
[16:45:00] Cruising through narrow bazaars, but not for long. Even on a rickshaw we are not really moving. I asked the driver how he does this
every day. "What can I do," he says, "This is Delhi." Indeed this is Delhi.
Do you hear the honking, I mean it's just maddening.
Chaos is part of the charm. Add to that toxic air, the worse in the world according to the W.H.O., and this city can literally take your breath away.
This is the other problem here, when you ask people for directions they'll just nod their head instead of point you this way and that way. You kind
of have to figure it out.
After living here for five years, I can't say I've figured it out quite yet. But you learn to let go and just be. Finally I'm here It's taken me
some two hours complete a 10 kilometer journey and that's roughly about six miles. In a city like New York, that would take what, 10 to 20 minutes.
And eventually amid the chaos, you find calm. Got what I needed. Sumnima Udas, CNN, New Delhi.
(END OF VIDEOTAPE)
QUEST: It is difficult to overstate just how appalling the traffic can be in these cities in India sometimes. As we continue with Quest Business in
Mumbai. Kanye West goes cap in hand to Mark Zuckerberg after revealing that he is millions of dollars in debt. What he needs is a chance to make,
QUEST: Just a few weeks ago Kanye West launched his new album and a collection at New York Fashion Week. Now it appears that the bills have
come in and Kanye West is many, many, if not 10s of millions of dollars in debt. And that's by his own admission. And so he's been Tweeting to likes
of Mark Zuckerberg, asking him to help out.
Our business correspondent with CNN Money is Samuel Burke. Samuel, now come on, can you ask one of the greatest, biggest stars in the world
claiming he's broke. Is that the jest of it?
SAMUEL BURKE, CNN MONEY, BUSINESS CORRESPONDENT: That's the gist of it and Quest, Kanye is good at a lot of things. He's a good recording artist.
He's clearly very good at getting publicity, but he's not very good at being consistent. Check out this Tweet he just sent a short time ago after
saying that he was tens of millions of dollars in debt. Now he's singing a slightly different tune. Tweeting, "Yes, I am personally rich, and I can
buy furs and houses for my family."
So it doesn't sound like he's really that much in debt. And in fact we can't find much evidence suggesting that he would be. Usually when an
entertainer is broke you have the managers suing, you have the record label suing, you have concert promoters suing. We can't find any of that, and on
top of it all take a look at what Forbes says about Kanye West. Just a short time ago 2014 the twentieth highest paid celebrity in the entire
world. Last year he raked in about $22 million. And Quest, at the end of the day he's married to Kim Kardashian. She made $52.5 million last year.
I think the children will have bread on the table no matter what happens with Kanye.
[16:50:05] QUEST: Is there any serious suggestion, Samuel, he goes bankrupt.
BURKE: No, in fact there's a lot of evidence to the contrary. I spoke with music experts who say, "Look he has an album out that's going to do
quite well." Already on Title. It's only available on Title. It's a streaming service owned by JZ. And now all of a sudden out of no were,
Title is the number one app on iTunes. So clearly he's going to be moving records. On top of that he'll be able to tour with the album.
He produces for other people. He's got the fashion line, which you're seeing right now on your screen. He even has a video game coming out.
Even if he invested a lot of money, I think whatever he's up to it's going to be profitable.
QUEST: And Samuel Burke, again congratulations, Business Correspondent for CNN Money. Samuel joining us from New York.
You've heard me a great deal about CNN Money during this program. Where can you find it? CNNmoney.com is where you'll be able to catch up with us
there. We'll have our profitable moment after the break.
QUEST: Tonight's profitable moment. I was announced today as the new editor-at-large for CNN Money. An honor and which I'm extremely grateful.
And as we move forward with the new CNNMoney.com the global brand with all my colleagues around world we hope we're worthy of your trust when we
deliver to you the business news you want and you deserve. And Quest Means Business for this Monday night. I'm Richard Quest in Mumbai. Whatever
you're up to the hours ahead. I hope it's profitable. I'll see you tomorrow.