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Taxation across borders in the AI economy

Countries are getting ready to tax the big Intenet giants.

But are they just targeting these companies or are they trying to address the underlying issues?

In my mind, it’s about data and information assets which are used to create or drive products which generate revenue.

This is not just about digital advertising revenue from search or social media (Google, Facebook). Or even about cloud computing infrastructure (AWS, Azure). It is much more.

What about massive genetic or sensor based data captured from large populations, and then used to create healthcare or diagnostic products? Or market specific information, which powers up securities trading systems?

Let’s say an American or Chinese or European company creates a wearable device healthcare product (for example, early detection or prediction of heart disease). This product or cloud based service then proceeds to generate large revenues from India and globally. What if the service was made possible and grows in value by using sensor based data from Indian citizens? 

How does India tax this company? 

This is complex new territory for taxation. We have fairly well established methods for taxation of services, goods and capital which move across borders.

We do not have anything yet for data or the products created using that data.

Sugar kills more people than gunpowder every year

“Sugar kills more people than gunpowder every year”

How true. 

Sugar (Sucrose and Fructose) are the biggest killers of our times. And sugar kills painfully and slowly through metabolic disease. 

The problem is it’s addictive nature. Sugar may be more addictive than cocaine.

In my opinion, there is no way to solve this unless we have a safe substitute for our tastebuds.

The artificial sweeteners are not working because they have safety issues. Some “safe” alternatives like stevia have taste and flavour issues.

There is some interesting work happening to solve these problems. 

One approach I read about is to isolate the sweetening compound from stevia and figuring out some other way of manufacturing it. This isolated compound does not have the taste issues present in stevia, which are due to some of the other compounds in it.

Another possible solution is inert sugar alcohols. Erythritol for example. Cost effective production of erythritol is a challenge which some companies are working to overcome. The other sugar alcohols are not so inert and cause gastric distress.

There is an interesting direction being explored by this Israeli company, using another sweetener that is available in a tropical plant. Read about it at this link –

I am sure other approaches will emerge too. The world needs something to reduce sugar consumption. Sugar is the tobacco of our age.

There’s a stone in your gall bladder and two in your left kidney

I was just reading an interesting article on the World Economic Forum website which speaks about seven interesting ways in which AI is being used today in healthcare.

Imaging seems to be a core application area and it’s not just about radiology.  Skin cancer diagnosis for example. That’s an imaging and recognition problem.

Eye scans is another imaging application. It appears that the two areas where AI is already doing very well is in the diagnosis of diabetic retinopathy and age-related macular degeneration (AMD).

I found the reference to brain scans and the corresponding imaging application very intriguing. The AI looks at the brain scan and is able to make a better prediction than a human doctor on the probability that a person in a coma will recover.

The radiology and cardiology applications. As also the interpretation of CT scans are more straightforward and intuitive. Here is a link to the article –

I am looking forward to big leaps in diagnosis via imaging at a microscopic level and spectrometry. How great it would be to diagnose common infections or micro nutrient deficiencies or most of the blood work that a lab does today; by simply shining a light on a drop of blood or maybe through the skin or pointing a camera into the eye. The machine interprets the image and gives you an almost instant diagnosis. Not just of an existing disease but also the likelihood of getting one?

The nature of imaging and interpretation is changing too. Soon we will not have the need to get into big machines for images from inside our bodies. Imaging could be a continuous affair using devices we can wear. This is already true for ECG. If the work of people like Mary Lou Jepsen becomes real, that’s what we will have. And surprisingly she uses sound to look into into the body. There’s an article about her work here – link –

This will mean that diagnosis is not a matter of looking at an image and comparing it with a knowledge base of images. It will be looking at a series of images. Hundreds or thousands or millions of them to identify patterns that point at something amiss. This is the amount of data that a human being will never be able to handle. An explosion in data will necessarily require machines to interpret the data. That’s the future of imaging and AI in medicine.

Wisdom of the ages – outcomes or processes

Here is a Ted talk that delivers an excellent though well known insight which is the basis of rational decision making – “You can not control outcomes. You can only control processes.”

Another way of saying this would be “Its of no use focusing on goals. It makes sense only to focus on the best set of actions that will get us to our goals”

This is the wisdom of the ages. We hear this not only from many of the gurus of today but is also baked into the folklore and cultural/religious heritage in almost all civilisations.

In the Bhagwad Gita, this is one of the most popular verses “Karmanye Vadhikaraste Ma Phaleshu Kada Chana”. People interpret it in many ways. For me it is simple and clear – It says, “focus on the best process or set of actions that will get you to your goal. Focusing on the goal will actually hinder your chances of getting there.”

You hear the exact same thing from the Greeks. The stoics and others. In Seneca’s words – “The wise man regards the reason for all his actions, but not the results.”

You hear it said in a different way by the Roman emperor Marcus Aurelius “Never let the future disturb you. You will meet it, if you have to, with the same weapons of reason which today arm you against the present.”

The Buddhist interpretation of Karma is almost the same.

I am willing to bet that this simple piece of knowledge exists in every major philosophy and culture.

It’s good to have goals. So you know what you want to accomplish. After that it makes sense to figure out what needs to be done to get there and then focus only on the actions while course correcting along the way.

You can not control the outcome. Only your actions.

The coming deluge of data in the medical world

A few decades ago, a physician or a pathologist had to deal with a much smaller knowledge base than modern medicine today.

As medical knowledge grew in size and complexity, we have seen the emergence of various specialities. And then naturally, superspecialists.

In the coming decade, we shall see an explosion of data. This is just round the corner in the biotech and medical world.

It will not be possible for human specialists to deal with this deluge of data or to make sense of it beyond a point.

It will become necessary for doctors and pathologists to work with AI machines which summarise and interpret this data for human specialists.

It will not be possible for doctors to function effectively without extensive use of artificial intelligence frameworks that help the doctor to diagnose or to recommend a course of action.

Here is an article that summarises the emerging situation well from a pathology viewpoint.



Why must we be metal and silicon?

There are many ways humans are trying to extend life. One influential school of thought is the idea that we will have the ability to replace damaged organs or extend the capabilities of our organs.

The popular imagination and science fiction has dealt with this and fantasised about this for many decades now. That humans will become cyborgs.

But that imagination has almost always been about metal and silicon. Or at least the core of the cyborg was metal and silicon. Look at Arnie in The Terminator – metal covered with flesh but not the other way around.

There was no flesh cased in a protective inorganic casing. Those were usually the evil aliens and not cyborgs or augmented humans. Our cultural biases were speaking – anything biological and as intelligent as the human is an evil alien.

What if the biggest advances are going to be in regeneration of organs. Whether it is within our bodies or grown elsewhere and transplanted into our bodies? Not just regeneration of hearts, kidneys, livers, bone and joints; but the brain too.

It appears to me that in the coming couple of decades, genetic engineering may make much bigger leaps than synthetic biology.  That the future is biological advancement of the human species and not fusion with inorganic machines.

We live in interesting times.

Here is the Ted talk that set off this thinking. Meet Dr Luhan Yang and Lika the cute pig –

Healthcare – China spends 10x and the developed world 100x of India

It is a pity that India spends so little on healthcare for its citizens.

For a country that ranks a low 130 on HDI but with superpower ambitions, it is a shame that we can’t spend enough to improve the healthcare available to our people.

The central government health budget is about ₹50K crores and the states three times that. The total healthcare spend by the centre and states put together is ₹200K crores, which is about 28 billion US dollars.  This translates to 21 US dollars per capita.

Another telling statistic is that most of the healthcare expense in India is in the private sector. Government spend of $21 is only 30 percent of the spend. Both rural and urban India depend primarily on the private sector for medical care.

As a comparison, spend by government in the US on healthcare is over 100 times more, at 2500 US dollars per capita. While total healthcare spends in the US are actually higher than 8000 dollars per capita, the share of government spend is about 2500 dollars.

In the UK, while total spend on healthcare per capita is lower than the US, the government spend on NHS is even higher than the US at above 3000 dollars per capita.

The Chinese government too, spends ten times as much as India does on healthcare per capita.

I am simply unable to understand India’s poor focus on healthcare.

True, the current government has come up with an ambitious healthcare policy but the proof of the pudding is in the budgets. What is the point of announcing a policy that needs ₹800K crores of funding but only ₹200K crores has been budgeted? Where is the balance money going to come from?

Is this then a policy or just a statement of desire?

I think it is clear and everybody understands now that our real capital is our human capital. But without prioritising health and education, the human capital will not be of good quality. Then of what use will that human capital be? Surely not capable of the productivity gains we need, if we are to become a middle income country in the next 15 years.

We will win 4 times the number of Olympic medals

The other day I noticed that my 26 year old son and most of his peers were taller and better built than my generation of urban Indians. And we were taller than their grand parents (our parents.)

As access to nutrition is improving for a large number of children and mothers, the population of healthy youngsters who are closer to their genetic height potential is increasing rapidly in India.

If (let’s say) 1 or 2 percent of the young people were as tall as they should be in our generation 25 years ago, in today’s India, it could be 4 percent or higher.

This means that the population that has the physical potential to compete and participate at the highest level of sports and athletics was half a million 25 years ago, it is possibly 2 million today.

So, as a sporting nation, going by the numbers of youngsters who would be a relevant population for high level sports, 25 years ago we were possibly the size of a small country like Albania and today we are probably the size of Ireland.

But the good news is that this is changing fast.

Within a decade or so, we will be much larger. By 2025, we could be almost as large as Israel and by 2035, as large as a Canada or Australia.

In parallel, the percentage of these youngsters with access to good sports facilities and coaching is increasing too.

Let’s expect that by 2035, India will be winning 3-5 times the number of medals it currently wins in the olympics.

It will still be way below our potential as a country.

To accelerate this, we need to ensure that more of our mothers and children get adequate nutrition.

Sholay and Pyaasa will be reborn in 2025

Technologies to create professional grade content are rapidly becoming ubiquitous and easy to use.

Take the example of the ability to take high quality photos and apply a range of effects on them. Anyone with a high end phone can do it now. You needed a studio with expensive software and a highly skilled person to do that just 15 years ago.

What about movies? Look at the amazing number of amateur produced, professional quality videos on YouTube! And so many of them now made with hand held phone cameras. An amateur with a handheld camera and video editing software on their computer can now create a recipe video which is just as good as something in Masterchef Australia. And that 3 minute video does not cost ten thousand dollars to produce. It can be done for as low as a hundred dollars.

What next? I will argue it’s the creation of virtual worlds that are indistinguishable from the real. Whether it is used for creating movies or games.

Within the next 5-6 years we will have inexpensive tools available off the cloud, which will make it possible for any amateur to create vast and complex virtual worlds, characters, voices, music and more and stitch them together to tell a story – into a movie or an interactive game.

Stuff that costs millions of dollars today to make for a Twentieth Century Fox or Yash Chopra Films or an Electronic Arts. This will be done by talented amateurs and created without any live actors, from the comfort of their bedroom desks.

Sholay, Pyaasa and other such movies will be remade. With the same actors. Young actors. In any period set of the producers choosing. In color. They will be better than the classics. They will be better than the originals. And nobody will be able to make out that they are artificial creations and computer generated characters and sets. They will be indistinguishable from the real.

This is not decades away. The first such movies will be available within 5 years. Some great tools are already there.

The biggest Indian natural disaster ever

India has faced many severe and huge natural disasters in the last 5 centuries.

The largest ones according to public memory and our history texts are the famines.

For example, the Bengal famine of 1943 was responsible for about 3 million deaths.

But what most people do not know and we are not taught in school is that the single biggest disaster was the 1918 flu.

The flu killed 5 percent of India’s population within a few months. About 18 million people.

A similar pandemic today with the same mortality rate would kill 70 million people.

The flu was caused by an H1N1 flu strain. Another strain of H1N1 causes what we all know now as the Swine Flu.

There are two theories about what caused such high mortality in the 1918 flu.

One is that it caused an extreme reaction of the immune system in young adults. If this was the case, a similar pandemic could cause equivalent rates of mortality today.

The second is that most of the deaths in 1918 happened as a result of a bacterial superinfection that followed the flu. The first antibiotics were not available until the 1930s! A similar occurence today would see most of those bacterial infections treated successfully.

It is surprising that the flu was not so devastating in the South and East of the country. Was it because of the high levels of coconut oil and coconut in the food? Monolaurin (Lauric Acid) in coconut oil is known to have antiviral properties. Did this protect them? Or was it something else?