- 2 days ago
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00:00We are facing yet another morning of new tariffs potentially with President Trump.
00:05We are threatening South Korea with an additional 25 percent.
00:10Do you think that 2026 is going to be better or worse than 2025?
00:14So overall I would say...
00:15The trade order in the world is shifting, it's moving a lot more to bilaterals from...
00:20...a common global sort of standard supply chains and that in a way is good...
00:25...for companies that are set up to think about countries rather than just regions.
00:30And we've been doing that for some time now. We of course began with India and China...
00:35...as specific focus 20 years back and we can now replicate those models for...
00:40...Germany, for Korea, for Japan, for Singapore and Malaysia separately.
00:45And that I think is helping us in move with agility.
00:50What does that help achieve? Higher margins? Speedier decision making?
00:55So I would say definitely speedier decision making because the organizations become flatter...
01:00...and they are able to then operate to changing conditions but it's great for customers.
01:05Because then customers and partners get a lot more agility and simplicity.
01:10...from our front end and that's what we are really enabling in terms of working there.
01:15Well, it's good to know that you're trying to make the best of what has been a chaotic 14 months...
01:19...but this...
01:20This morning when you woke up and you heard of the potential additional tariff on South Korea...
01:25...what does that mean specifically for your local business there?
01:28So I haven't really engaged to understand...
01:30...the details there but I think there is news comes both ways...
01:33...the similar news that...
01:35...is coming on today and being in India here is the EU-India FDA.
01:40And I think that is a very good indication of what could happen in global supply chains.
01:45It means really increase in trade both ways between India and the EU.
01:50It also means that India's manufacturing capability will get a...
01:55...boost as will for many other countries in the EU and the longer term...
02:00...the impact is co-innovation on both the information technology...
02:05...but also in the physical world as we think about manufacturing and as we think about...
02:10...energy given that we are here at India Energy Week.
02:12Alright, I know you want to talk about India Energy Week...
02:15...but I will go back and make a last try at what is the net impact going to be.
02:20...if that 25% additional tariff on South Korea comes through in terms of...
02:25...will you have to rejig regional supply chains in some significant fashion or will it...
02:30...just be a direct hit to your bottom line.
02:32So as I said I haven't seen the specifics of...
02:35...what has been announced but what I can say that we are geared in local supply chains...
02:40...overall and we have been doing that for the last five years.
02:42So this doesn't happen overnight.
02:44We have been...
02:45...really working and that began because of the pandemic.
02:48I think that was a great wake up...
02:50...to call to everybody in creating supply chains that could work within local ecosystems.
02:54We did...
02:55...and therefore we are very well set up to work with uncertainties that come in with any kind of...
03:00...bilateral changes.
03:01All right.
03:02You know what looks most interesting to you in technology?
03:05...right now.
03:06So I have spoken about it recently this whole concept of physical AI.
03:10...is a new capability that's not just a concept and a pilot.
03:15It's truly landing at scale.
03:17So maybe just first conceptually explaining what it is.
03:19Yes, please do.
03:20If you think of a car plant in let's say the five top geographies which is the US...
03:25...China, Germany, Japan and India then you would say the car plant is different.
03:30Different product, different technologies, different kind of a set up, different sets of people in skills...
03:35...that come into those plants.
03:36Therefore the physical AI that will depend on the domain there, the context of...
03:40...the data there and how determinism plays out in that plant will actually configure differently.
03:45...in each of these geographies and therefore physical AI has an opportunity to be developed differently.
03:50...in each country.
03:51Now that's conceptual.
03:52It's landing in a real basis in energy.
03:55It's not easy already.
03:56I'll take the example of autonomous control centers in...
04:00...different energy plants.
04:01We just announced in December our autonomous control center in...
04:05...Berouj in UAE and that's an energy plant which therefore...
04:10...leverages the power of AI in truly creating efficiency, in creating...
04:15...effectiveness of assets and enabling workers and skills very, very differently.
04:20We're seeing that autonomous land differently in different regions of the world which is...
04:25...I spoke about the Middle East, the US, Asia, all are developing differently.
04:29Why?
04:30The energy sources are different.
04:31The setup is different.
04:32All right.
04:33So this just simply means...
04:34...you know...
04:35...a multifold expansion of business opportunity for you.
04:38That's what you're telling me.
04:39It definitely means...
04:40...that we are geared to work in a way which is very local but also create new...
04:45...technology.
04:46Yes.
04:47All right.
04:48Talking about the India opportunity, you have...
04:50...what more than 13,000, 14,000 people here in India.
04:52Yes.
04:53Are you looking at a significant expansion?
04:55...to that number?
04:56And where do you see the best potential right now?
05:00So India has always been for the last two decades a very big focus area for us and we've...
05:05...built it over a period of time, not just in one type of capability, it's not just software...
05:10...it's not just the global capability centers, it is not just manufacturing...
05:15...it's not just the front end of creating our connections in 20 cities with customers...
05:20...and being present to reach more than 50 cities, it's all of that put together and therefore...
05:25...we continue to expand in all of those areas, definitely India is gaining momentum.
05:30...at this point in time because it's playing in very different areas.
05:33I'll give you one example.
05:35People don't talk about too much but it's unique for us.
05:37There are only two places on the planet where we do...
05:40...the core engineering and research for the energy value chain which is...
05:45...basically pilot plants for let's say refineries and other petrochemical situations.
05:50The two locations for us are Illinois in the United States and...
05:55...Golgaon in India and this was done two decades back so we've scaled it over a period of time.
06:00And now it becomes a very significant capability that India can now provide to many parts.
06:05...of the world.
06:06Are you not impacted by the 50% tariff that India has been facing?
06:10...for the last several months on account of President Trump's trade war?
06:14In some...
06:15...some parts it is likely especially in sourcing but the way we are configured we are able to...
06:20...work the supply chains the India products that are going out are likely to be for...
06:25...for the Asia Pacific region or for the Middle East region.
06:27So you've had to redirect a lot of that over the last six months?
06:29I would say...
06:30...we were geared already with the pandemic five years back.
06:33We started working the local supply chains.
06:35It was five years back so we were geared to work in the current bilateral situation.
06:38So there has been no cut back?
06:39So there has been no cut back?
06:40...in terms of the India product or services that you were exporting to the US?
06:44As I said...
06:45We already had local supply chains which are very different.
06:48Okay.
06:49And...
06:50And so for instance when you say that the India-EU deal might help then...
06:55...if your supply chains are so localized then how do you hope to benefit let's say from additional...
07:00...trade between India and the European Union?
07:01It opens new opportunities.
07:02Such as?
07:03We were not doing that much.
07:05Maybe from India to the EU but with the FDA that's a possibility both ways.
07:10Because we have a lot of manufacturing in the EU.
07:12We have a lot of manufacturing in India.
07:14I think we can optimize...
07:15...that much better going forward.
07:16Okay.
07:17One of the things of key talking points here...
07:20...at the India Energy Week is really going to be the big new demand elephant in the room which is...
07:25...the AI.
07:26How are you looking at that opportunity?
07:28Where do you see maximum potential?
07:30...for growth let's say in the near term which is 6 to 12 months.
07:33So I spoke about...
07:34Outside of the US.
07:35Yes.
07:36I spoke about physically.
07:37Let me land that in the outside of the energy sector which we've seen a big...
07:40...pick up in 2025.
07:41Think about physical AI in buildings...
07:44...in processes...
07:45...as plants that is energy and in the industrial context.
07:47Buildings is something that everybody relates to because of...
07:50...the building is an airport.
07:51It's a hospital.
07:52It is a hotel.
07:53It is an office.
07:54A data center?
07:55It's also a school.
07:56So if you think about that...
08:00...every building needs energy efficiency.
08:02It needs a better way of providing safety and security.
08:05It needs a better way of providing productivity for people.
08:08A lot has been...
08:10...and we talked about the potential of AI in helping these buildings.
08:13We saw a big uptick in 2020.
08:152025 for this turning from pilots to real production scale environments.
08:20We have seen universities, chains of hotels really implementing this in a...
08:25...big way.
08:26Airports were doing that already.
08:27Offices are coming together to do this.
08:29Today...
08:30I would say just in...
08:31...by the end of 2025, we have more than 200,000...
08:35...sites now globally that have implemented this capability of connected...
08:40...landings, which is creating a very large amount of data and benefit to the customers.
08:45So I think this is a momentum that is now feeding itself as we go forward.
08:49And we are seeing many parts...
08:50...of the world.
08:51Singapore is a great example.
08:52We announced this partnership with EDB for efficient building...
08:55...in Singapore.
08:56It's also a lighthouse for the world.
08:58What gets done in Singapore will actually...
08:59True.
09:00...can be seen by a lot of the world.
09:01Hopefully India's smart cities will learn from that.
09:03One final quick short question.
09:05The biggest challenge in this transition, the AI transition and...
09:10...the AI energy transition.
09:11I think it's really about moving the appreciation...
09:15...and training and skill sets of people to leverage it...
09:18...both as a provider.
09:20...as well as a user in customers.
09:23That has been the biggest...
09:25...sort of I would say blind spot for many of the companies.
09:30...are doing this.
09:31We have been working on this for a long time.
09:34So we bring it...
09:35...in talent of many different kinds.
09:37And that I think is an asset for us.
09:39Because we are geared.
09:40...already to do this.
09:41We began this journey five years back.
09:43And therefore we have been...
09:45...really ramping up that talent base.
09:47And our customers appreciate it...
09:48...because we bring the best to them.
09:50Thank you very much.
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