The New Oil Superpowers Are Not Who You Think

TITLE: The New Oil Superpowers Are Not Who You Think | Govindraj Ethiraj | The Core Report CHANNEL: The Core DATE: 2026-06-05 ---TRANSCRIPT--- Good morning. It’s Friday the 5th of June and this is Govindra Jati Raj broadcasting and streaming weekdays from Mumbai India’s financial capital. Our top stories and themes as we go into the weekend. The stock markets await the reserve bank’s move on a credit policy as well as on foreign investment incentives. The big shift in oil production and movements. Is the UK free trade agreement hitting a bump even as more FDAs are on the anvil? Kota closes a $1 billion real estate fund with majority foreign direct investment. Where could these funds go? Understanding what the neat controversy means from a healthcare industry perspective. This is a call report with Goind Raj Adira.

Well, good news. Monsoon rains though delayed have hit the coast of India’s southernmost states of Kerala on Thursday. That’s yesterday, 3 days later than expected according to the meteorological department. The June September monsoon rains which are of course critical for the economy usually hit Kerala around the 1st of June and then cover the entire country by middle of July. The southwest monsoon has covered the entire state of Kerala and parts of neighboring Tamil Nadu. According to the Indian Meteorological Department, conditions are favorable for it to advance further into Gua, parts of Maharashtra and Andhra Pradesh, additional areas of Karnataka and the remaining parts of Tamil Nadu over the next 2 to three days. We will of course be closely monitoring its arrival into Mumbai and as always we’ll welcome it with much longing and some weariness. Today is the big day. The Reserve Bank of India is forecast to hold its key rate at 5.25 25% being Friday the credit policy and that’s according to a Reuters poll though most economists expect a hike by the end of the year as inflation and heavy or high foreign outflows pressure the economy and the rupee and of course the Reserve Bank could indicate that it may respond out of turn. More than that there are some measures expected to incentivize foreign portfolio investors particularly with lower or no taxes on sale of government bonds. Could there be other announcements in this regard when it comes to sale of equities? Well, we don’t know, but we will know. The Nifty50 was up around 11 points to close at 23,416 and the Sensex was up 14 points to close at 74,360. So, it was a flat market on Thursday. The broader markets, the Nifty Midcap and Nifty Small Cap were up to about4 and4% each. Meanwhile, is a sharp rise in loan uptake from power, renewables, and data centers driving up credit demand? Well, India’s money market turnover has jumped to a record as state-owned lenders stepped up borrowing to fund a booming credit demand. According to a Bloomberg report, the value of trades in the so-called triparti repurchase segment, which accounts for about 70% of the country’s money markets, rose to an all-time high of 550,000 cr rupees or about 58 billion on the 13th of May and has stayed elevated since according to that Bloomberg data. On Wednesday, the CEO of India’s largest bank that’s the state bank of India said that they were seeing strong loan uptake from sectors like power, renewables and data centers. So there could be some two and two coming together. The funding rush has posted sharp overnight borrowing costs and short-term bond yields in recent weeks, underscoring banks ongoing struggle to attract deposits as household savings flow into other investment products. According to that Bloomberg report, the currency markets rupee was down on Thursday, extending a two session decline according to a Reuters report which added that the rupee closed at 95 rupees 78 pes per dollar from about 95 rupees 70 pes on Wednesday. Oil prices were down on Thursday after a ceasefire deal between Israel and Lebanon once again raised hopes for a larger agreement that would end the USIsrael war with Iran and that in turn could lead to a reopening of the state of Armas. Brent futures were at around $9667 a barrel on Thursday morning. But there is something more interesting happening or has happened in recent months. Daniel Yurjin, the vice chairman of SNP Global and author of The Prize and an authority on the oil industry and the energy industry, wrote in a Wall Street Journal piece that overall today, the Western Hemisphere now produces more oil than the Middle East did before the crisis. Canada, he says, is the world’s fourth largest oil producer. Brazil produces four times as much oil as Venezuela. And in Ghana, where production began only 7 years ago, output almost equals Venezuela’s. In Argentina’s Vaka Muetta region, shale oil production has grown six-fold since 2020, and the current disruption, he says, will propel more oil and gas investments in the Western Hemisphere and Africa. Yjin also says that diversification goes beyond oil and gas, responding to the tanker war during the 1980s Iran Iraq war. Saudi Arabia built variety in the form of a pipeline system that now moves about 7 million barrels of oil a day west to the Red Sea. Abu Dhabi built a pipeline looping around the state of Armas and plans to double capacity by 2027. France, which once depended on oil for electric generation, now relies mainly on nuclear. Japan led the development of the LG industry to push oil out of its electric generation. The growing scale of wind and solar adds further diversification for electric generation. According to Yjun in that Wall Street Journal piece, we will have lots more on energy in general in coming days and we’ll have specifically more on wind and some solar on Monday in an exclusive interview with Suzlon chairman Girish Tanti. Meanwhile, the Indian government has said that it sees Venezuela as a preferred partner in the sector at a time global oil supplies have been disrupted by the Middle East crisis. Venezuela’s interim president Deli Rodriguez is visiting India with a large team of ministers and also met with Indian Prime Minister Reend Modi on Thursday. A Reuters report says India was the second largest importer of Venezuelan oil in May with purchases of about 427,000 barrels a day, second only to the US. Reliance Industries has emerged as one of the three largest buyers of Venezuelan crude. Venezuela itself is on course to become the fourth largest supplier of oil to India in May, Reuters said, quoting Kepler data. Now, here’s the geopolitics of it. India had stopped buying Venezuelan oil last year after US President Donald Trump authorized a 25% discretionary tariff on countries buying buying crude from the South American nation but resumed purchases when sanctions were eased in February. So India has largely if not entirely followed a US-led path here financial disclosures of Rajes exports based out of Bangalore over the years were correct. its chairman told Reuters on Thursday, a day after the Securities and Exchange Board of India alleged the jeweler had inflated the scale of its revenue through unverified overseas entities. The regulators observations stemmed from differences in revenue calculations and did not consider the company’s consolidated revenue, its chairman told Reuters on Thursday. The sebi had said on Wednesday that some 99% of Rajes exports revenue came from overseas subsidiaries but the jeweler did not disclose their financials. Sebi also said that Rajes exports had misrepresented about 15 trillion rupees or 158 billion of subsidiary revenues between 2021 and 2025. According to Meta who spoke to Reuters, he said that as the world’s largest gold refiner, the subsidiary company refined about 3,000 tons of gold in those four years. So naturally its revenue would be over 15 trillion rupees. And the biggest SEBI observation is on difference in revenue which is large because SEBI did not consider consolidated revenue but only standalone. He said talks between Britain and India on implementing a free trade deal are moving quickly and going well. according to Britain’s trade minister suggesting the deal would not be reopened but could come into effect later than expected after a dispute over steel. The free trade deal was agreed upon in May 2025 and signed 2 months later to be implemented after each country ratified the deal which was expected to happen within about a year. So that’s where we are right now or not. India expects about nine free trade agreements signed over the last 3 years to become operational within 10 months with plans to execute another three or four significant packs over the year over the next year according to the trade and commerce minister. The trade minister’s statement underscores the government’s intent that’s the Indian government’s intent to make the country a manufacturing and investment hub and deepen integration with global markets. At least two or three very substantive FDAs will come into force in the next 6 months following the implementation of the Oman FDA on June the 1st according to India’s trade minister PJ Guyel who was speaking at a city 2026 conference in Mumbai reported by the business standard Kotak alternate asset managers or Kotak alts the alternate asset arm of Kotak Group has achieved a final close of its 14th real estate fund at about a billion dollars, which in turn is backed by a 675 million anchor commitment from a wholly owned subsidiary of the Abu Dhabi Investment Authority and a first commitment to Indian alternatives from the National Pension Service of the Republic of Korea or NPS Korea. Total assets under management across these funds is around $4.5 billion right now according to the firm. I spoke with Vikas Chimakorti CEO of Kotak Als and I began by asking him how he was seeing investment opportunities ahead for real estate in general and for his funds. So 13th fund goen was also similar to what we have done in the 14th fund real estate focused fund where we invest across asset classes of real estate. is not skewed towards one particular asset class and we do both credit as well as equity and that’s what we’ve been doing in the past and 14th also will be the same one right and you’ve across all your 14 funds you’ve raised about $4.5 billion is that correct yes okay and what’s the kind of investments that you’ve been making all these years that you’ve been investing and what’s changed recently if so so most of our capital is skewed towards high yield credit and significant portion is in that segment and there is investments where we have done equity as well but to take more on non-residential is where we have done equity in terms of what has changed now so if I was to break up the asset classes residential being clearly the largest one which is there I would say that there is some slowdown which is there in terms of volumes across the cities some cities would be higher in terms of reduction some would be lower but is there a trajectory is it upwards the answer is no it is downward wards but to what extent it would be time only will tell in terms of pricing we are not seeing any upward pressure on the pricing I would say it would be more stable and most of the developers are financially very strong it was not the case what it was in 2016 to 1819 period where the leverage levels were very high the leverage levels now are under control or I would say lower so from the delivery point of view we don’t see a challenge what we saw in 2016 to But there will be some working capital mismatches which will be there where we see that is something where we will play back to the role. Right. And tell us about like a typical investment that you do. I mean where do you at what point do you enter? What project or what kind of project in what geography? So we are primarily focused on the top six cities. Bombay, Delhi, Bangalore, Chennai, Hyderabad, Punea and Kolkat also we invested capital. The most of our capital historically would have gone in for land acquisition or situations where banks or NBFCs cannot participate. It could be situations where we have participated in NLT processes with debit occurs or acquisition of assets through SARC or any of those special situations kind of situations. Most of the situations would be on high yield where we have participated in the project success as well to make higher returns right and what is your outlook right now I mean as you at this point since you’ve raised funds and you’re looking ahead what are the kind of investments that you would be looking at where are you seeing opportunities so the opportunity set is strong at this point of time our opportunity set increases more when there is some slowdown or perception of slowdown which is currently the situation there is some reduction in volumes, velocities, etc. And I see that’s where our capital requirement will increase going forward. Okay. You said residential is the largest and you said it’s about 80%, and but how’s your investment skew? Is it also similar? No, our investments is not that residential heavy. It would be more like 65 to 70% of our investments historically have been in residential. Rest have been in various other real estate asset classes. Right? You know obviously the real estate market has got fairly institutionalized from a financing point of view and we’re seeing many players including on the other side with REITs and so on. How do you see the market overall growing and where do you see the future opportunities particularly for financeers like you? So the market if you was to look at it the market is getting consolidated big players are becoming bigger and if you go back 10 years back you had very fragmented market you obviously had big boys they were not as big as what it was in the what it is now and at that point of time people the big boys used to go in for land aggregation land acquisitions from the scratch as they have become bigger they are not getting into that much on land aggregation or land cleaning kind of a capital they are just going and buying cleaner lands and there are fewer set of people who have this core competence of aggregating land and giving capital and resolving land issues. Lot of our capital in last couple of years has gone into some of these land aggregators or land clearing kind of people because they are not able to attract larger checks of capital and institutional kind of a capital. So some portion of our capital has gone into that kind of a situation and we believe that there is a large opportunity there. There are very fewer set of players who are able to generate and give clean lands to developers and fewer sources of capital also looking to give that solution capital which is what we are doing. So for us the advantage is that the big boys typically don’t take high yield capital from players like us. It is typically good developers but not the big boys who have the ability to build construct sell who come for capital providers like us but then at the same time there is large opportunity which we see with the land providers where we are given capital that’s where we see larger opportunity going forward right last question so the Abu Dhabi investment authority and the NPS Korea which is their pension fund has invested in this the question is not so much about them but when these kind of funds invest into India Are they comparing or are they looking at this as an alternative to equities or is it part of a portfolio or generally how do such funds evaluate opportunities like this? Internally first it is there within their system only they decide in terms of how much of the capital will get allocated from their sources of capital in terms of alternatives right alternatives is private capital within the private capital then they allocate between various parts of private capital. How much will go to private equity? how much to real estate etc and hedge funds and all of it right out of that real estate which gets allocated of that how much they are willing to do to global funds or regional funds and to a country specific fund. So that is where their internal location process works and country specific funds is not easy to get capital which is a challenge because people would prefer to do a global fund or a regional fund where they’re not taking one country specific. So to get that kind of capital for a country specific one you had to have consistently delivered returns people should have seen a larger track record from a same team which is there one who has done the firm which has been there done that right so that’s how they decide in terms of specific country specific capital is not easy it is pretty challenging it’s a good note to end on thank you so much for joining us thank you kak alternate asset managers which is a part of the kotak mind the group focuses on alternate asset management and investment advisory businesses and was set up in 2005 and says it has raised, managed and advised over 22 billion across different asset classes ranging from private equity, real estate, infrastructure to investment advisory. The National Eligibility Entrance Test Undergraduate known as NE UG has been at the center of a controversy this year following allegations that the question paper has been leaked. The government’s national testing agency which conducts the exam cancelled the test that took place on the 3rd of May because of an investigation into those allegations. Now the NE is the only path for aspiring medical students in India to secure admission to undergraduate medical and dental courses like MBBS, BDS and AUS courses in both government and private colleges across India. So while we look for solutions that make the process of testing more seamless and of higher integrity, it is useful to take a step back and understand the scale of the problem and why we are where we are. I reached out to Dr. Dr. Kalash Sharma, dean academic project, Stata Memorial Center, Mumbai and Xboard of Governors of the Medical Council of India and I began by asking him to walk us through the scale of the problem and also look at it from a overall healthcare industry point of view. It’s a very burning topic as on today. So you know before say 2010 there was one test which was all India medical entrance test where the students used to appear and there were 15% seats reserved at all medical colleges from central kota that is government of India kota that was number one test number two was all states were having their own medical entrance test by their own methodology so the remaining 85% seats were being filled up by the state entrance placed. Then what happened? 2010 the medical council of India got dissolved and there were board of governors. So the board of governors they decided that now there should be a scrapping of all India test also and there should be scrapping of the state test also. There should be one test which will be known as national eligibility come entrance test for all the medical colleges and that today we are talking of undergraduate test. In 2010, the board of governors prepared a document and in 2011 I joined as a board of governors and that time these documents were nicely prepared and it was decided that now the need should happen and in 2013 the first need happened but within few weeks it was scrapped by Supreme Court of India that it is a unconstitutional and it is not accepted by all the state governments. So the state government should have their own taste and in 2013 it never happened because the judgment was two to one and then later on in 2016 it was again given a good mandate by five bank judge of the Supreme Court and the first test happened and thereafter it continued. So it was earlier taken by CBSC and later it was transferred in 2019 to national testing authority which presently is taking the test. That is the genesis of NEIT. Right. tell us about the or give us a sense about the total supply and demand for medical students in terms of seats and how many people apply and then I’ll also come to why it is so competitive. Yes. So right now there are more than 1.5 lakh undergraduate suits all over India. They are divided into three types of medical college. One is completely owned by government of India that is as and as like institute. Second is state government medical colleges. Third is private colleges but affiliated to the state health university or any other university. And the fourth college is having to be a deemed university college where all rights are with them only to admit take the exam and everything and they are not affiliated to university because they are having a deemed status under UGC act. So these are three types of colleges and right now there are around 1.5 lakh seats and there’s a fierce competition to enter into medical college. Every year the seats are increasing. On the top of that the students who want to enter into medical college and that to in a government medical college the competition is rising and there are around 27 to 28 lakh students after 12th they appear to enter into leak to go into medical college. Right. Okay. So you’re saying for 150,000 seats you have roughly about 2.8 million students appearing at undergrad medical level. Now tell us between the government colleges, state government colleges, deemed universities and private. What’s the mix and what do students desire and how do they apply for either of them or each of them? You have touched upon a very nice and very sensitive issue why people want government college. Every medical college as per national medical commission should have good infrastructure. Yes. Private college having good infrastructure I agree government yes good equipments both are having then third is clinical material that is the case mix and the number of patients visiting government college as you understand that government medical colleges are always full of OPD full of IPD and there are 150% patients get admitted there are floor mates also in government college so there is abundance of clinical material in a government medical college versus private college where there are less number of patient less number of cases mix and fifth factor is faculty at government medical college under any situation whether there are transfers resignations people are not happy there will be around 90 to 95% faculty available at all time to conduct the OPD to see the patient and to teach the student versus the private college where they may say that they have got more than 90% faculty but they are all honorary they are part-time they may not be attending properly so there is a lack so there is a fierce competition for students to appear into NET and to get admitted into a government medical college because all these factors are there. Number two will be at government medical college there is a fees regulated which is around 1.5 to two lakh per year multiplied by say 5 and a half year it will be around 10 to 11 lakhs versus private medical college where the fees will be ranging from 6 to 8 lakh per year to 15 lakh per year amounting to say 1 cr or more than 1 cr and there are different types of another fee like exam fee, hostel fee, development fee by private college. So to go into private medical college you have to shell out around more than 1.5 cr for entire MBBS course of five and a half year and one year of internship versus the permanent medical college where the fees will be around 10 to 15 lakhs only. So that’s why this ugly and cruel competition is going on and that’s why the neat and the competition which is the crux of the event which is happening now that why people are so much interested into entry into government college that means having a good merit. So people having good merit will enter into government middle college the lower merit will go to private college and deemed university colleges. So that’s my view on private versus government, right? And roughly how many seats are there in government and government related systems? If I’m not wrong, there must be say 55% seats in government versus say 25% seats in the private and deemed university colleges. Just as a sort of slight aside, you talked about hospitals alongside these teaching colleges. So is that something that is there across all colleges? Yes, all private colleges, dean colleges will have their own hospital. they will have all the facilities available. So I told you infrastructure very good, equipment is very good, faculty is the main issue at private and deemed colleges and the clinical material that is number of patients case mix all these things are very difficult at these colleges versus the government colleges where there are abundance of clinical material very good number of patient very good case mix and the students will get lot of teaching material in a government college versus the private right I’ll come back to the exam system in a moment but if you take another step back how do you see the total availability of medical students and thus doctors in India versus what the demand is. Yes, considering all our urban, rural, metro and super metro distribution of doctors, you will find that at the primary health center level and at the lowest level the number of doctors available is very very minuscule versus the doctors available in metro cities and maybe at district places rather than Taluka and the rural places. That is the abnormality and say anomaly between the distribution of doctors. Why they want to only clock to good cities, district places, agrade city, tier one, tier two cities versus the government where government is running their primary health centers, wellness centers where there is a lack of doctors. You always find it in newspaper that why doctors are not going there because they get the appointment but they are not interested there. They want transfer and they come back to say semi-urban or urban state. That’s why the inequality in distribution of the manpower available at say rural level versus the urban level and that is the mismatch that’s happening. That’s why the healthcare is not proper maybe in our country in terms of aggregate numbers and I’ll come to seats now. So if we have 150,000 seats what’s the ideal number of seats that we should have for a country of India size. If we take the evidence of world trade organization they say that for thousand people there should be availability of one doctor where right now we are having less than that and that’s the real fallacy in our distribution of doctors as per the population and that two population rural versus semi-urban and urban right and why do we not have more medical seats as a very general question at this point of time so for last 5 years and 10 years there is a very encouraging picture from the government side that in Maharashtra now every district place is having a good government medical college and in UPMP then Andra Telangana Tamil Nadu yes they are having also good number of government medical colleges but private medical colleges for last maybe 20 25 years are really mushrooming because they have taken it as a business not as a hospital and not as a education right but in terms of numbers you said we have 150,000 seats is that an ideal number should we be having much more medical students with medical seats. If say next five years we have two lakh seats and then we have but whenever the number of seats are increasing there will be a dilution of the standard of teaching standard of clinical material and standard of the examination it will get diluted. So that’s a fallacy. But yes, I’m not against increasing the number of seats. But when the number of seats are increased, there should be facilities also available so that students can learn within five and a half years of their curriculum a good doctor like MBBS and there will be a competition again for going into post-graduate and then super speciality and all these things. So it should be increased to up to two lakh to 2.5 to three lakh. It should double in next say five to seven years. Right? And if I can ask you to look at this or the current situation of supply of doctors and the challenges that we are having in the selection system from your perspective as a super specialized physician in cancer care where do you feel we are as a country in terms of as you look at the longerterm supply of specialist doctors so undergraduate we have already touched upon now there is a fierce competition from MBBS to go into PG which is MD and MS and from MD and MS again into super speciality like DM and MCH and all different subjects like oncology, cardiology, nephrology, urology all all such subjects and now the specialist initially there was a general practitioner which was available and general practitioners are usually the family physicians they should be available so that they can sort out all the local matters and those who are really a clinical presentation of a patient and then they can refer to specialists but right now you will find that number of specialists are more available in a taluca place and at metro places rather than the rural place. So nobody after passing MDMS or super speciality would like to go to a rural place because they don’t have education for their children. They don’t have facilities for them to be practicing. So there is a mismatch but there is a encouraging picture right now that MDMS seats are also increasing. So number of qualified doctors, specialists like surgeons and physicians, internal medicine these are available right now at good taluka places and maybe little semi- urban places for last five years. Yes, there is a encouraging availability of all these specialists also. But at super speciality in some subjects are available. But in super speciality in say oncology my topic which is close to my heart and mind there are less number of doctors available in the entire country and Southeast Asia as far as the oncology go. Right. So we started by uh or rather I started by asking you about the NE. What do you feel needs to be done to make NE more strong or robust and with higher integrity than what we have currently seen? Right now the need base is paper pen and testing versus the recommended would be a computerized based test because it will have a stronger safeguards. It will have a faster processing and it will be a good pathway for a adaptive testing which is being right now utilized by GRE and GMAC. So if it is a computerized testing there will be no papers no paper setting no translation no paper transportation availability opening distribution it will be computerized so that student sits at center opens the computer but there will be a problem that availability of network should be there should not be any failure of the server. So as for GRE and GMAC the exam will be so robust and so adaptive testing means it will happen like this like question difficulty will be dynamically adjusted to the candidates performance and it has a very scientific base and calibrated assessment system if you go by CBT computer based test which will have a adaptive testing type of ability so that a student can perform weak student versus strong student strong questions for such weak questions. All these will be very well balanced and managed. Ultimately the question bank has to be there and question bank is always a human bank. Human own doctors only will give the questions but the chances of leakage will definitely go down and down if you have a computerized best test which will have a robust background and I think next year it should get available and it should be implemented. Thank Dr. Sharma. Thank you so much for joining me. Thank you Goh. It was a very nice and burning topic. That was the core report with me Govindraj Ethi. 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