Download Our App
Over 42% surplus rainfall in July has reduced the overall monsoon rainfall-deficit to 15.2% from 40% at June-end, with a reduction in the number of districts witnessing a shortfall in rains to 178 from 262, agriculture minister Shivraj Singh Chouhan said on Wednesday.
Indian refiners’ medium-to-long-term plans to explore crude purchases from Iran may be hit after the US revoked sanctions waivers on Tehran’s energy supplies amid a flare-up in tensions in West Asia. The latest escalation, which pushed Brent crude up 8% to above $80 a barrel, brought energy-security risks back into focus for India.
The Centre’s FY27 capex is firmly on track with no restrictions on departments despite fiscal headwinds from global uncertainties, sources said. “Capex is going on well. We have not restricted anything,” a senior official told FE. For FY27, the Centre has budgeted capital expenditure to rise 14.3% on year to Rs 12.22 lakh crore. Effective capital expenditure, which includes grants-in-aid to states for asset creation, is projected to be Rs 17.1 lakh crore in FY27.
The Joint Committee (JC) reviewing the ASEAN-India Trade in Goods Agreement (AITIGA) has laid down timelines for sub-groups dealing with specific policy areas to expedite the process. “To maintain the momentum of negotiations, the Sub-Committees were assigned time-bound deliverables and encouraged to work closely towards achieving tangible outcomes within the agreed timelines, ” a statement after the 13th meeting of the committee said here on Wednesday.
Economist and author Surjit Bhalla on Wednesday said that a comprehensive India-US trade agreement could reshape India’s economic trajectory and help the country realise its Viksit Bharat vision by 2047. Bhalla told ANI that the agreement should be India’s top economic priority as it would boost technology access, expand markets and sharpen India’s global competitiveness far beyond any gains in trade volume. “The trade deal with the US is not just about trade surplus. It is about markets, technology, etc,” he said.
India has urged the United States to address concerns over proposed tariffs linked to forced labour through the ongoing bilateral trade agreement (BTA) negotiations rather than unilateral action, while questioning inconsistencies in Washington's tariff framework during a public hearing before the US Trade Representative (USTR). Appearing before a USTR panel on Wednesday, Brij Mohan Mishra, Joint Secretary in the Ministry of Commerce, said India remained open to dialogue but stressed that trade-related concerns should be resolved within the framework of bilateral negotiations.
India's consumer inflation likely breached the central bank's medium-term target of 4% in June for the first time in 16 months, according to a Reuters poll, as higher food and fuel prices, the U.S.-Iran war and a weak monsoon added to cost pressures.
As the Reserve Bank of India (RBI) continues its forex diversification strategy, India's holdings of US Treasury securities are down to almost a six year low. As per US Federal Reserve data, India's exposure to US Treasuries has dropped to $181 billion in April this year. The reduction in US government debt holdings has partly been offset by a rise in gold reserves. This shift highlights India's ongoing strategy of diversifying its foreign asset portfolio.
India, Australia and Canada are set to strengthen cooperation in technology and innovation, with the three countries signing the Australia-Canada-India Technology and Innovation (ACITI) Partnership Memorandum of Understanding (MOU), on Thursday. The agreement is set to boost collaboration in critical and emerging technologies while complementing existing bilateral initiatives between the three countries. The new tech triangle was announced as Prime Minister Narendra Modi and Australian Prime Minister Anthony Albanese unveiled a series of agreements to deepen their Comprehensive Strategic Partnership.
A sharp correction in imported fertiliser prices after the US-Iran peace deal, coupled with a likely reduction in Kharif crop area due to El Nino and a weak monsoon could help the government keep its fertiliser subsidy expenditure in FY27 close to the Budget Estimate of Rs 1.71 lakh crore, official sources told Financial Express.
It is starting to seem like India’s factories are holding up but the farms aren’t. The latest HSBC report stated that, as per the bank’s database of 100 growth indicators, only 54% grew positively in May, the softest reading in at least eight months and a sharp drop from 73% in January,
The fragile peace in the Gulf has been shaken once again. Late on Tuesday, the US Central Command said it had carried out a fresh round of “powerful strikes” on Iran. The attacks came just hours after three commercial oil tankers, including the Qatari-flagged Al Rekayyat, were hit by projectiles and a drone while passing through the Strait of Hormuz.
Finland’s Foreign Affairs Minister Elina Valtonen has said the upcoming India-European Union Free Trade Agreement (FTA) will create new business opportunities, increase investments and generate jobs for people in both India and Europe. Speaking to ANI on Monday, Valtonen said relations between India and Finland are at their strongest and have the potential to grow even further across several sectors, including trade, green energy, technology and security.
Next week, India will introduce a new high-frequency indicator to track activity in the country's services economy, marking a major expansion of the statistical toolkit used to assess short-term economic trends. The Ministry of Statistics and Programme Implementation (MoSPI) is set to release the first Index of Services Production (ISP), based on 2024-25 as the new base year, on July 14. The indicator is designed to provide policymakers, businesses and investors with a more timely picture of economic activity in a sector that now contributes well over half of India's gross value added (GVA).
In May, the Consumer Inflation (CPI) rose to 3.93%, the highest in 16 months, with food inflation rising to 4.8%, and wholesale prices (WPI) to 9.68%. Foreign Institutional Investors (FIIs) have pulled out a record ₹2.3 lakh crore ($30 billion) in the first five months of 2026 from Indian equities. What is the real state of the Indian economy?
The Donald Trump administration's Section 301 probe and threat of fresh tariffs has added a layer of uncertainty for several countries including India. The United States Trade Representative (USTR) has advanced one of its two investigations into America's trading partners, even as the July 24 deadline for the temporary 10% additional tariff draws closer.
Sowing of key kharif crops – rice, pulses, oilseeds and cotton – seems lagging with overall sown area being 35.08 million hectare (Mha) as on Monday, down 21% year-on-year. According to the Agriculture Ministry, total sowing was about 32% of the normal area of 110 mha in that window. By the same time a year ago, more than 40% of the normal area had come under fresh crops.
The next phase of the global economic order could be shaped by countries that act as connectors across geopolitical divides, creating a unique opportunity for India to emerge as a connector economy, Mahindra Group Chairman Anand Mahindra said on Monday, highlighting that the current period of prolonged global uncertainty favours countries capable of balancing competing alliances.
India and the European Union (EU) are working together to finish the legal scrubbing of their Free Trade Agreement (FTA) in the next 15-20 days, Commerce and Industry Piyush Goyal said Monday. “I had a very good conversation with my counterpart (EU Trade Commissioner Maros Sefcivic) on Sunday. I am meeting him on July 14 and 15 in Brussels along with a delegation of business persons,” Goyal said at the Council of Leather Exports (CLE) Export Excellence Awards.
The newly launched Viksit Bharat-Guarantee for Rozgar and Ajeevika Mission (Gramin) (VB-G RAM G), which replaces the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), promises higher rural incomes through 125 days of guaranteed employment and increased wages, but its long-term impact on India's rural economy may depend on whether states can absorb the significantly higher fiscal burden, according to a report by Systematix Research.
India's crude oil basket has fallen below pre-conflict levels in West Asia, averaging $67.88 per barrel so far in July, according to data from the Petroleum Planning and Analysis Cell (PPAC). The data showed that the Indian crude basket, which represents the average cost of crude oil imported by the country, stood at $68.21 per barrel on July 3. This is the lowest level since the West Asia conflict began and is even lower than the average of $69.01 per barrel recorded in February, before the crisis.
As India's merchandise trade deficit with Japan nearly tripled from $5.18 billion in 2015-16 to $15.4 billion in 2025-26, the government is reviewing the existing free trade agreement (FTA) with the island nation. While officials acknowledge that it is difficult for Indian exporters to make significant inroads into the Japanese market, they believe the pact can be better leveraged to attract higher Japanese investments into India.
In a major boost to soil nutrient supplies, 15 vessels carrying over 0.7 million tonne (MT) of fertiliser variant and raw materials – urea, di-ammonium phosphate (DAP) and sulphur – have crossed the Strait of Hormuz and is expected to reach India ports soon.
India’s proposed free trade agreement with Peru is unlikely to be concluded “soon”, Commerce and Industry Minister Piyush Goyal said on Saturday, even as bilateral trade between the two countries surged 67.5% to $10 billion in 2025-26. Speaking to reporters on the sidelines of the 17th Toy Biz International B2B Exhibition, Goyal said New Delhi still has concerns over market access in certain products.
A sharp decline in global crude oil prices following the easing of tensions in West Asia has improved India's fiscal outlook, with economists now expecting a much smaller slippage from the Centre's fiscal deficit target of 4.3% of gross domestic product (GDP) for 2026-27 than anticipated a few weeks ago.
Amid growing momentum in their economic partnership, India and Russia are aiming to achieve $50 billion in mutual investments by 2030 through joint projects in advanced manufacturing, critical minerals, and green technology.
Falling crude oil prices are giving the Reserve Bank of India and other Asian central banks more headroom to prioritise growth, as easing energy costs reduce pressure on the region's external accounts, according to Standard Chartered's Weekly Market View report dated July 3, 2026. The global bank described the oil price decline as offering "disinflationary relief" for monetary policy across much of Asia, though it said this relief would play out unevenly depending on each economy's energy dependence and inflation dynamics.
The first two months of FY27 have been marked by higher subsidy payouts and elevated interest expenditure. Faster spending on railway capex remains the key bright spot, while most other spending trends are broadly in line with expectations. The customary additional tax devolution to states in June may not have materialised this year due to weak tax collections and the front-loading of capex loans, although it could occur in Q2. Non-tax revenues, disinvestment proceeds and asset monetisation receipts are also tracking below expectations.
The India-UK free trade agreement has pegged the minimum local value addition level for manufactured products to qualify for lower duties between 35% to 55%, depending on where the value of the finished product is calculated. For agricultural products, largely local origin would be insisted upon. The minimum local value-added requirement under the so-called Rules of Origin rules for different products that would be traded between India and the UK at concessional duties once their Comprehensive Economic and Trade Agreemfaent (CETA) becomes operational has been notified by the Central Board of Indirect Taxes and Customs (CBIC).
Surplus rainfall of over 34% this month has reduced overall southwest monsoon deficiency in the current season till Sunday to 24% from close to 40% at the end of June, the India Meteorological Department (IMD) said on Sunday. Cumulative rainfall during June 1-July 5 according to the met department is over 24% below the benchmark longer period average (LPA), which is still in the ‘deficient’ range. Due to the ‘active’ phase of monsoon during the week over the rain-fed core zone of central India, the deficit in the region has been reduced to 14% from over 50% reported till end of June.
The mandatory rollout of E20 petrol has led to vehement pushback and repeated clarifications from the government over the past year. Motorists have repeatedly questioned whether older vehicles could suffer corrosion, wear or reduced performance — even as the Centre announced excise duty exemptions for yet-to-be-released concentrations of 22, 25, 27 and 30 percent ethanol blending last month. A new study suggests that complaints about mileage and engine performance have also grown sharply over the past two months.
Global Capacity Centres (GCCs) in India are presently witnessing a sizable boom. Figures posted by CII, NASSCOM and Deloitte via its latest report titled ‘India’s strategic GCC play for Japanese enterprises’ confirms the same. India’s GCC sector, which had a direct gross value added contribution of around $68 billion in FY25, could grow nearly 2.6 times to $155–199 billion by FY30, the report said, citing Nasscom’s GCC ecosystem estimates.
India’s merchandise exports rose by more than 15% year-on-year in the April–June quarter of this financial year, while services exports grew 11% in the same period, Commerce and Industry Minister Piyush Goyal said on Friday. In the corresponding quarter of the previous financial year, merchandise exports stood at $111.56 billion, while services exports were $97.4 billion.
Union Finance Minister Nirmala Sitharaman on Friday said India’s expanding middle class has become the “engine of growth”, with household consumption playing a key role in supporting the country’s post-pandemic economic momentum. Speaking at a session on “How to promote the rise of a new middle class?” at Les Rencontres Economiques d’Aix-en-Provence 2026 in France, Sitharaman said India’s growth story was being powered not just by investment and reforms, but also by the spending strength of its middle class.
India’s export performance has improved sharply after a weak period between December and March, think tank GTRI said, adding that the more encouraging sign is that the recovery extends beyond petroleum. “Exports excluding petroleum grew 9% in April and 11.9% in May, reversing a 9.2% contraction in March and near-stagnation in January.
India has set its sights on achieving $1 trillion in exports this financial year, with Union Commerce and Industry Minister Piyush Goyal outlining an ambitious roadmap that hinges on strong growth in both merchandise and services exports. Read more at: https://economictimes.indiatimes.com/news/economy/foreign-trade/india-aims-for-1-trillion-exports-this-fiscal-year-says-piyush-goyal/articleshow/132161149.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
The India-Israel Bilateral Investment Agreement (BIA) which was signed in September last year, came into force into Saturday. "The Bilateral Investment Agreement (BIA) between the Government of the Republic of India and the Government of the State of Israel signed on 8th September 2025 in New Delhi, enters into force with effect from today, i.e., 04 July 2026," the Ministry of Finance said in a statement.
Union Minister for Finance & Corporate Affairs, Nirmala Sitharaman and Roland Lescure, Minister of Economy, Finance, Industrial, Energy, and Digital Sovereignty of France, co-chaired the India-France Economic and Financial Dialogue in Aix-en-Provence on Friday, the Ministry of Finance said. The Ministry said the dialogue was held as part of efforts to strengthen economic engagement between India and France within the framework of their special global strategic partnership.
Exporters' body FIEO on Friday urged the government to operationalise goods and services tax (GST) refunds for foreign tourists to promote tourism and retail exports. It said that Section 15 of the Integrated Goods and Services Tax (IGST) Act, 2017, provides for a GST refund mechanism for foreign tourists purchasing goods in India. Despite nearly nine years having elapsed since the introduction of GST, this important provision remains unimplemented, the Federation of Indian Export Organisations (FIEO) said.
India's obsession with gold has always been viewed through two very different lenses. For households, it is a store of wealth and a hedge against uncertainty and also a symbolic asset passed down generations. For policymakers, it is also a recurring macroeconomic headache because almost all the gold Indians buy has to be imported. India imports with precious dollars most of the gold Indians buy so enthusiastically every year, and that gold vanishes into family holdings.
Housing and Urban Development Corporation (HUDCO) on Friday signed a preliminary agreement with Bihar to provide up to 1 trillion rupees ($10.50 billion) in loans for urban infrastructure projects, in one of the country's largest state-level infrastructure financing deals. The loans will be extended to the eastern state over a five-year period. HUDCO will provide the loan in tranches to the statutory authority of Bihar, and it will be used for urban infrastructure projects, including land acquisition.
The World Bank has moved Sri Lanka back into the upper-middle-income category, marking a significant milestone in the island nation's recovery from its devastating 2022 economic crisis. Vietnam and the Philippines have also been upgraded, reflecting years of sustained economic expansion.
Finance minister Nirmala Sitharaman on Friday described the middle class as the growth engine of India and said nearly 500 cities are poised to emerge as the country's next centres of economic activity. Participating in a panel discussion on 'How to promote the rise of a new middle class' nearly 500 cities are poised to emerge as the country's next centres of economic activity.
Finance Minister Nirmala Sitharaman on Friday said India's middle-class and slightly affluent class will account for 93% of the country's consumption by 2036 due to the tax relief and welfare measures implemented by the government that have aided to boost the spending capacity of the population.
India has a youth unemployment problem. That much is clear from the numbers. Unemployment among Indians aged 15-29 stood at around 15% in April 2026. Behind this figure sit millions of young people caught between classrooms and careers, watching rising living costs and unaffordable housing eat into whatever certainty they had left. But zoom out and a bigger picture emerges. This isn’t just an India story. It’s a global one.
Russia supplied more than half of India’s crude oil imports in June, with shipments surging 39% month on month to 2.61 million barrels per day, even as the country’s overall imports remained nearly flat at 4.98 million bpd, the highest June volume on record. Russian crude accounted for 52.4% of India’s total imports during the month, up sharply from 37.7% in May, when supplies stood at 1.87 million bpd out of total purchases of 4.97 million bpd, according to data from commodity intelligence firm Kpler.
A cut in petrol and diesel prices may not come immediately despite the sharp decline in global crude oil prices. Union Petroleum Minister Hardeep Singh Puri on Thursday explained the reason behind it during a presser. According to Puri, the state-run oil marketing companies (OMCs) are still refining expensive crude purchased during the peak of the West Asia conflict. He said any decision on reducing retail fuel prices would depend on whether international crude prices remain at current levels for the next two to three months.
As India pushes toward its ambitious ‘Viksit Bharat 2047’ vision, World Bank India’s Executive Director Neelkanth Mishra has offered a detailed blueprint on what the country must achieve economically to be officially considered a developed nation and why the next two decades could be decisive. In a recent opinion piece, Mishra argued that for India to attain high-income or developed nation status by 2047, the country will need to sustain one of the fastest long-term growth trajectories in modern economic history, while overcoming demographic and structural challenges that could slow progress permanently.
India and Japan on Thursday unveiled a series of major agreements covering defence, artificial intelligence (AI), critical minerals, energy and investment during the 16th India-Japan Annual Summit in New Delhi. Prime Minister Narendra Modi and his Japanese counterpart Sanae Takaichi also announced a new economic partnership framework and an economic security declaration. The two sides signed multiple agreements aimed at expanding cooperation in emerging technologies, defence manufacturing and resilient supply chains.
India's dominant services sector expanded at its slowest pace in 17 months in June as domestic demand weakened sharply and overall new business grew at its slowest rate in over two-and-a-half years, according to a survey that also showed hiring nearly stalling. HSBC's India Services Purchasing Managers' Index (PMI), compiled by S&P Global, fell to 57.4 last month from May's 59.8, but was slightly higher than a preliminary estimate of 57.3. Readings above 50.0 indicate growth in activity.
Food inflation in India is projected to average around 6 per cent in the 2027 fiscal year, while the headline Consumer Price Index (CPI) inflation is expected to settle at 5 per cent. A severe rainfall deficit at the start of the monsoon season is driving these projections, posing a direct threat to agricultural output and domestic food prices. According to a report by CareEdge Ratings, monsoon rainfall between June 1 and June 29, 2026, recorded a deficit of 41.5 per cent from the longperiod average. This sharp dip raises immediate concerns over food production and overall inflation, especially since domestic edible oil inflation already stood high at 9.5 per cent in May.
Around 35 lakh more electric vehicles (EVs) are expected to replace petrol vehicles during 2027-2030, helping India save nearly Rs 1 lakh crore in crude oil import bills if EVs account for 20 per cent of the vehicle market by 2030, according to a report by the State Bank of India (SBI). The report said EV adoption has accelerated significantly following the onset of the West Asia conflict in February 2026, with registrations witnessing a sharp rise. It stated, "Our estimate indicates that during the four-year period of 2027-2030, 35 lakh more EVs are expected to replace the petrol vehicles.... EV vehicles have now reached more than an 8 per cent share in 2026. A 20 per cent share by 2030 could save Rs 1 lakh crore of the import bill."
Indian exporters are seeing a sharp surge in orders from the United Kingdom ahead of the India-UK Comprehensive Economic and Trade Agreement (CETA) coming into force on July 15, as buyers move quickly to take advantage of the proposed tariff cuts. Textile and garment exporters are seeing 12% higher orders from the UK than last year while orders of leather handbags and shoes are up 20%. Gems and jewellery exporters said consignments worth $6.5 million are ready for shipment, and chemical exporters expect a 30-40% rise in shipment to the UK.
India’s white-collar hiring has entered a sustained slowdown after touching a high in February, with companies pulling back on fresh recruitment. According to the latest foundit report, the hiring index has fallen for four consecutive months – from 404 in February to 385 in March, 370 in April, 348 in May and 331 in June, representing an 18% decline from the February peak. Hiring in June was 9% lower than a year ago and 5% below May, signalling that employers have become increasingly cautious amid an uncertain business environment.
As new synchronised steel trade measures by the UK and European Union (EU) came into effect on Wednesday, India preserved its competitive advantage in both markets. New Delhi’s free trade agreements with both trading partners have enabled it to make relative gains.
The Uttar Pradesh Defence Industrial Corridor (UPDIC) has attracted investment proposals totalling Rs 39,571.09 crore as it shifts from planning to production, state government officials said. This underlines the corridor’s growing role in India’s defence-manufacturing push and Uttar Pradesh’s $1 trillion economy ambition.
Japanese private companies are set to inject a massive $12.5 billion into the rapidly growing Indian market through approximately 120 cooperation agreements at the 16th Japan-India Annual Summit, coinciding with Prime Minister Sanae Takaichi's first official visit to New Delhi on Thursday. In a post on X, Japan's Deputy Chief Cabinet Secretary Masanao Ozaki, who arrived in New Delhi along with PM Takaichi, noted that over 150 companies will be participating in the Japan-India Economic Forum, adding that it will strengthen government-to-government relations in areas such as security and economic security.
Ahead of the July 24 expiry of 10% tariffs imposed by the United States, exporters of chemicals, textiles, carpets and leather goods said they are getting more enquiries from their American clients than in the past few months but these are yet to translate into orders. Uncertainty over Section 301 tariffs and unpredictability of US policies are deterring large orders, they said. The US was India's second-largest trading partner in 2025-26, with goods exports increasing 0.92% year-on-year to $87.3 billion.
India is fast-tracking efforts to sell stakes in some of its largest state-owned companies, including the nation’s biggest life insurer, as Prime Minister Narendra Modi’s administration looks to bolster public finances strained by high oil prices. Life Insurance Corp. of India, Hindustan Zinc Ltd., and several state-controlled banks are among eight companies identified by officials for stake sales in the coming months, according to people familiar with the matter. A share-sale in LIC alone may raise as much as 100 billion rupees ($1.05 billion), while Hindustan Zinc could fetch another 50 billion rupees for the government, Bloomberg reported earlier.
India is unlikely to raise its official inflation target and there may be a case for lowering it over the long term, Reserve Bank of India Governor Sanjay Malhotra said at an event in Russia on Wednesday. The country's inflation-targeting framework has helped lower average inflation, the central bank chief said in a conversation with his Russian counterpart, Elvira Nabiullina. India adopted its inflation-targeting framework in 2016, which tasks the Reserve Bank of India with keeping headline consumer price inflation within a band set by the government.
Global personal wealth witnessed an extraordinary 10.8% growth in 2025, its fastest growth in at least three years, shows a new UBS report. While the USA remains the primary millionaire factory, India outpaced many developed markets in growth. India’s wealth is rooted in real assets rather than financial assets, and owes less debt.
India's economy ended the first quarter of FY27 on a strong footing with various high-frequency indicators showing robust growth in June, reflecting resilience despite the West Asia war and other external headwinds. Gross goods and services tax (GST) collections rose 13.9% to Rs 1.95 lakh crore in June from the year before, closer to the Rs 2 lakh crore milestone, led by robust import-led revenues and higher compliance. Car sales grew 24% in June from a year earlier, and power consumption rose 11.6% to 166.5 billion units.
India’s financial sector stability risks remain contained, but recurring external shocks could spill over and affect the macroeconomic outlook, the Reserve Bank of India (RBI) said in its Financial Stability Report (FSR) released on Tuesday. However, the central bank asserted that strong fundamentals provide “ample buffers” to withstand potential disruptions. The Indian economy remains vulnerable to energy price shocks and supply chain disruptions, but the financial system’s resilience is supported by strong balance sheets of banks and non-bank financial companies (NBFCs), the report said.
The cessation of the conflict in West Asia has significantly improved India’s macroeconomic outlook by easing risks to growth, inflation and the external sector, finance ministry economists said on Tuesday. They, however, cautioned that deficient monsoon rainfall and rising climate-related uncertainties remain key challenges. In the monthly economic review for June, the ministry said the West Asia peace deal has reduced concerns over external stability after the prolonged conflict tested India’s economic resilience. “The cessation of the conflict in West Asia has brightened the growth outlook and also reduced inflation and external deficit risks,” it said.
The Centre’s fiscal deficit widened sharply year-on-year in the first two months of 2026-27, reflecting higher spending and weaker tax receipts. However, public-finance experts said the fiscal position is likely to improve over the rest of the year as crude oil prices ease and non-tax revenues remain robust. According to Controller General of Accounts (CGA) data, the fiscal deficit stood at Rs 1.6 lakh crore during April-May, accounting for 9.6% of the Budget Estimate (BE) for FY27, compared with 0.8% of the respective target in the year-ago period.
Deficient monsoon rainfall has delayed sowing of key Kharif crops— rice, pulses, oilseeds, maize and cotton—with overall sown area being 18.27 million hectares (Mha) as on June 25, a 23% year-on-year decline. According to the Agriculture Ministry, total sowing till last Thursday was about 16% of the normal area of 110 mha in that window. By the same time a year ago, more than 21% of the normal area had come under fresh crops.
India’s manufacturing sector activity growth eased in June as demand moderated and export orders weakened. The seasonally adjusted HSBC India Manufacturing Purchasing Managers’ Index (PMI) fell to 54.2 in June from 55.0 in May. The June reading marked the second-weakest improvement in manufacturing health since mid-2022, though it remained above the long-run average. The HSBC India Manufacturing PMI is a gauge of overall conditions derived from measures of new orders, output, employment, supplier delivery times and stocks of purchases.
India has secured adequate crude oil and liquefied petroleum gas supplies through at least August, easing concerns over domestic availability as the rapid return of Gulf barrels shifts the global oil market increasingly in favour of buyers. “We have secured adequate LPG supplies through at least August, while crude availability remains comfortable. With more barrels returning to the market, procurement conditions have shifted in favour of buyers,” a senior oil marketing company official said.
India remains the world's fastest-growing major economy despite a challenging global environment, and sustaining high growth will require continued reforms, investments and execution, HUL Chairman Nitin Paranjpe said on Tuesday. Addressing shareholders at the 93rd AGM, India has demonstrated "structural resilience" at a time when global economies are grappling with geopolitical conflicts, climate volatility, tightening financial conditions and shifting consumer behaviour.
The rationalisation in the goods and services tax rates last September delivered a larger-than-expected expansion in the tax base, with higher taxable supplies more than offsetting the revenue foregone from lower tax rates, according to a government analysis. Average monthly taxable supply, an indicator of revenue for businesses, grew 22.5% in the second half of FY26 (after GST changes on September 22). As the levy completes nine years on July 1, a look at the impact of last year’s changes.
The overall debt of the household sector reached 45.5 per cent of the country's gross domestic product (GDP) due to an uptick in non-housing retail loans, according to the RBI's latest Financial Stability Report (FSR). The Reserve Bank of India said the increase in household sector debt was due to rising non-housing retail loans, which constituted 58.4 per cent of total borrowings as of March 2026. Their share has increased steadily over time, consistently outpacing housing loans, agriculture and business loans.
The Reserve Bank on Tuesday said the interim peace deal between Iran and the US can provide tailwinds to Indian economic growth. In its bi-annual financial stability report released on Tuesday, the central bank also said that the growth in gold imports has decelerated "substantially" in May 2026 over April.
India's inflation is likely to remain relatively contained in the coming months, supported by the recent correction in crude oil prices and softening of key input costs, including urea, following the cessation of the West Asia conflict, the finance ministry said in its latest Monthly Economic Report released on Tuesday. "Although the normalisation of global supply chains and trade flows to pre-conflict levels may take time, the decline in international commodity prices is expected to provide some cushion against further price pressures.
India’s industrial output grew 5.1% year-on-year (YoY) in May as compared to 4.9% in April under new series. The Index of Industrial Production (IIP) was at 122.7 in May, up from 116.7 in the same month last year. Ministry of Statistics and Programme Implementation (MoSPI) said that this was driven by strong growth in the manufacturing and electricity sectors.
India could be within “striking distance” of achieving 8% annual economic growth if the global geopolitical situation remains stable, Shaktikanta Das, principal secretary to the prime minister, has said, adding that the government has more economic reforms in the pipeline. In an interview with the Financial Times, Das said the Indian economy had weathered a series of global shocks, including the Covid-19 pandemic, the Russia-Ukraine war and the recent conflict in West Asia, and had emerged stronger after each crisis.
Brent crude has seen one of its fastest reversals in years — surging on fears of a prolonged Strait of Hormuz shutdown before retreating after the US-Iran agreement. The focus now shifts from panic to recovery, as inventories, shipping & Asian demand determine what comes next, writes Saurav Anand Why oil prices surged, and then fell so quickly The recent rally was driven by fear, not an immediate shortage of oil. The Strait of Hormuz carries nearly 20 million barrels of crude oil and petroleum products a day, equivalent to almost 20% of global oil consumption, besides around 20% of global LNG trade.
Falling crude oil prices have prompted some analysts to trim India's inflation forecasts for the current fiscal year, but an uncertain monsoon season is emerging as a fresh risk to rural consumption and corporate growth expectations. as per a TOI. Consumer goods companies are increasingly turning to diversified product portfolios to cushion the impact of a potential slowdown in demand from rural markets, which have been a key driver of India's consumption story in recent years.
India's e-commerce exports could surge by at least USD 10 billion over the next two to three years, a senior trade official said on Monday, pointing to the country's vast MSME ecosystem and untapped global consumer reach as the key drivers of that growth. Rajesh Kumar Mishra, additional director at the Directorate General of Foreign Trade, said the opportunity was hiding in plain sight. China already clocks USD 300 billion a year in e-commerce exports — and India, he argued, could close some of that gap with its existing strengths and a sharper approach.
Moody's Ratings does not expect higher oil prices or a wider fiscal deficit to threaten India's investment-grade rating this year. The agency said India can absorb temporary budget pressure from energy costs as long as the government continues to bring down the deficit over time. India is rated Baa3 by Moody's, the lowest investment-grade level, with a stable outlook. Christian de Guzman, Singapore-based senior vice president at Moody's Ratings, said the rating is supported by the government's fiscal repair since the Covid-19 pandemic. “We don’t see India as being particularly affected because this shock is largely negative for most sovereigns,” Bloomberg quoted Christian de Guzman, Singapore-based senior vice president at Moody’s Ratings, as saying in an interview.
The government has pledged an additional Rs 30,000 crore towards new and upcoming investment platforms of the National Investment and Infrastructure Fund (NIIF), taking its total commitment to the quasi-sovereign wealth fund to Rs 60,000 crore. The proposal was approved by the Cabinet last week, the finance ministry said on Monday. It’s expected to spur investments across sectors, including transportation, energy, digital infrastructure, urban infrastructure, e-mobility and other nationally important projects, the ministry said, underscoring NIIF’s role in bringing additional private capital and aiding growth.
India’s external debt was at $762.8 billion at the end of March 2026 up $26.3 billion from a year ago. As a result, the external debt to GDP ratio increased to 20.8% at the end of March 2026 from 19.8% a year ago. The valuation effect due to the appreciation of the US dollar vis-à-vis the Indian rupee during the quarter and other major currencies amounted to $24.6 billion, RBI said. Excluding the valuation effect, external debt would have increased by $51 billion instead of $26.3 billion year on year.
India's economy continues to do well despite global headwinds, with available economic indicators pointing to continued resilience despite external challenges, Secretary in the Ministry of Statistics and Programme Implementation (MoSPI) Saurabh Garg told on Monday. "As you said the last quarter was extremely positive. The initial data releases from April, for example, we released the Index of Industrial Production (IIP) data, it was at 4.9 per cent. Today afternoon we will be releasing the IIP data for May. It will not be correct for me to anticipate that data, but all indications are that despite the global headwinds, the economy continues to do well and the resilience of the economy is coming out", he told ANI.
The government’s current rice and wheat stocks are at a record 91.6 million tonne (MT) which is likely to offer a cushion against any possible shortfall in the production of foodgrains due to the El NinoEl Nino risks. At present, the Food Corporation of India (FCI) has 40 MT of rice and 51 MT of wheat against a buffer of 13.54 MT (rice) and 27.58 MT (wheat) MT for July 1 respectively. Current rice stock excludes over 27 MT of rice yet to be received from the millers by the corporation.
Union Commerce Minister Piyush Goyal held a productive meeting with Greece's Minister of Development Takis Theodorikakos to discuss strengthening economic ties, as per a statement by the Minister. Taking to his X account he shared that he "Had a productive meeting with Mr. Takis Theodorikakos, Minister of Development of Greece." Goyal said both sides discussed boosting the India-Greece economic partnership through greater trade, investment, industrial cooperation and resilient supply chains.
India's economy is headed for a huge leap, on its way to touching the $7 trillion mark by the end of this decade! At the IX USISPF Leadership Summit 2026, India's ambassador to the United States, Vinay Mohan Kwatra, laid out a long-term growth roadmap for the country, pointing to a series of big economic jumps ahead. Kwatra said that India, currently a roughly sior seale up in the coming years $4.3 trillion economy, is heading towards a major scale-up in the coming years.
India's debt market is not yet equipped to finance the country's next phase of economic growth and needs structural reforms to support rising long-term capital requirements, according to Deloitte's latest State of Financial Services in India report. The report said India can no longer rely on bank deposits to fund rising credit demand as household savings and consumption patterns evolve. It warned that unless the debt market becomes deeper and more efficient, it could become a bottleneck to the country's economic ambitions.
Brent Crude falling below the psychologically important $75 per barrel level is definitely good news for India. After all, imports constitute nearly 85-88% of its total crude oil requirements. While economists welcome the 22% drop in crude prices in June, they believe it is important for prices to sustain at these levels for long-term gains.
Engineering exports to key markets in West Asia staged a sharp rebound in May as the exporters found alternative routes, ports and even vessels get to the markets of the United Arab Emirates (UAE) and Saudi Arabia. Engineering exports to UAE grew 81.7% on year to $ 1.24 billion in May after contracting 66.8% in March when the war in West Asia started and shrinking 31.7% in April. A similar trend was seen in shipments to Saudi Arabia. In May growth in engineering exports was at 11.6% to $ 375.9 million. In March the decline of 45% was recorded while in April the engineering exports to Saudi Arabia were down 9.7%.
Shipping through the Strait of Hormuz has staged its strongest recovery since the West Asia conflict, with 341 vessels crossing the strategic waterway in the week following the June 17 US-Iran agreement and daily transits surging to a record 78 on June 24 from just 25 on June 17. The latest tally represents 57% of pre-war traffic, signalling a rapid revival in crude oil, LNG, LPG and commodity shipments through the world’s most critical energy chokepoint, according to S&P Global.
India has asked the European Union for relief from planned curbs on metal scrap exports as steel and aluminium makers warn the move could tighten supplies, raise costs and undermine gains from a trade pact, industry and government officials said. From May 2027, the EU's revised waste shipment regulation is set to bar exports of non-hazardous waste to countries outside the OECD group of mostly developed economies, unless the EU approves them by November 2026.
The government is planning to create an index to monitor the performance of businesses that are not registered as companies, as part of efforts to improve the measurement and understanding of India's informal economy, according to an official. The index, proposed by the ministry of statistics and programme implementation (MoSPI), will provide insights into the health of the large yet often difficult-to-measure informal sector. "The ministry aims to soon come out with the index for unincorporated sector enterprises," the official said. "While the official timeline is 2031, we are aiming to launch it earlier."
The recent easing of the West Asia crisis has sharply reduced the biggest near-term upside risk to the RBI's inflation outlook, strengthening the case for maintaining a growth-supportive monetary policy stance, Ram Singh, director of the Delhi School of Economics, said in an interview with ET. Singh, who also serves on the RBI's Monetary Policy Committee, said he hopes the impact of El Nino remains contained so that it can be treated as a temporary supply-side shock. Edited excerpts: Has the reopening of the Strait of Hormuz removed the biggest near-term upside risk to the RBI's inflation projection of 5.1%?
China's rising demand helped power India's frozen shrimp exports to a record high in FY 2025-26, while the United States retained its position as the country's largest export market, according to the Department of Commerce under the Ministry of Commerce and Industry. It added that the "strong performance reflects sustained demand for Indian seafood products and the growing reach of India's marine exports across international markets." According to an infographic shared by the Department on its social media platform, the country's frozen shrimp exports reached an all-time high during FY 2025-26. While the United States remained the largest destination for Indian frozen shrimp exports with shipments worth USD 1.61 billion, China emerged as a major growth engine, with exports to the country touching USD 941.6 million.
Rural development minister Shivraj Singh Chouhan on Sunday called on states to suggest fresh reforms for the uplift of hinterlands, and implement extant schemes effectively. India’s robust growth story and its vision to emerge as a developed nation by 2047, he underscored, are closely tied to the progress of its villages. States have the critical role of taking benefits of rural schemes to beneficiaries in even furthest corners. So they should suggest new measures, and whether existing programmes need a revamp, the minister said.
A lasting peace in West Asia will restore India’s growth momentum with the GDP likely growing at 6.6-6.8% in FY27 if crude prices settle at relatively lower levels and shipments through the Strait of Hormuz normalise, according to EY. “A gradual normalisation of global energy markets is expected to ease supply-side pressures, improve cost conditions, and support both growth and inflation outcomes during FY27,” according to the June 2026 edition of EY Economy Watch.
Transformational growth should be the prime focus of the India-UK Free Trade Agreement (FTA), Commerce and Industry Minister Piyush Goyal told business leaders at a plenary session in London on Friday. The minister is in the UK on a three-day visit to review the preparedness of both countries for the implementation of the Comprehensive Economic and Trade Agreement (CETA), which comes into force on July 15.
Global corporations and institutional investors have announced more than USD 90 billion in fresh investment commitments to India in recent months, betting on the country's long-term economic growth despite rising geopolitical tensions, trade disruptions and an uncertain global outlook. The planned investments span artificial intelligence, cloud computing, digital infrastructure, manufacturing and industrial technology, reinforcing India's position as a key destination for global capital as companies diversify supply chains and expand in high-growth markets, sources said.
Veteran economist Montek Singh Ahluwalia has played a crucial role in shaping the modern Indian economy and was a key part of the government’s liberalisation efforts from 1991. In an interview to Business Today, he spoke about the Indian economy and the West Asia crisis. He says the current account deficit (CAD) will be higher and GDP growth will be lower than current official forecasts and inflation will also be higher. But he warns that the balance of payments problem cannot be solved simply by cutting imports and relying on import substitution.
India's economy is expected to grow 6.6-6.8% in the current financial year, with easing global energy prices and the normalisation of shipments through the Strait of Hormuz likely to improve growth and inflation prospects, according to EY Economy Watch. The report said a gradual normalisation of global energy markets is expected to ease supply-side pressures, improve cost conditions and support both economic growth and inflation outcomes during FY27.
The day the US finds appropriate tools and legal backing that gives India a tariff advantage over its competitors, the trade deal between the two countries will be finalised, Commerce and Industry Minister Piyush Goyal said on Thursday. “Until the framework for getting that competitive advantage can be finalised, we cannot Enter Into Force (EIF) the US deal,” he said at the India Global Forum in London.
India’s crude oil basket has returned to the level before the West Asia conflict started, with war premiums fast evaporating after the US-Iran peace deal. According to Petroleum Planning and Analysis Cell (PPAC), the basket price crashed a steep 55% from a record high of $157.04 per barrel on March 23 to $70.71 on June 24, completely reversing the oil shock. The latest price is exactly the same as the pre-war level on February 19.
Capital expenditure by states likely grew a modest 2% on-year in April-May FY27, a sharp slowdown from the 33% expansion recorded in the corresponding period of FY26. Data compiled from 18 major states showed that aggregate capital expenditure stood at Rs 61,314 crore during the first two months of FY27, compared with Rs 60,094 crore a year ago, reflecting subdued growth.
Despite the revival of monsoon progress in the last few days after a gap, a huge deficiency in rains this month is unlikely to be bridged. So, sowing activities for several kharif crops is likely to be delayed. Pushan Sharma, Director, Crisil Intelligence, stated that the delayed progression of the monsoon across western and central India is likely to postpone kharif sowing and transplanting, particularly for paddy, cotton, pulses and key horticultural crops such as onion and tomato. In Maharashtra, just 1% of paddy transplants have been completed, while cotton sowing remains significantly behind the schedule.
You might think that the world’s supply chains are returning to normal now that oil appears to be flowing unhindered from the Persian Gulf for the first time in four months. Watch out for what’s happening on the far side of the Arabian Sea, though. The key input into another sort of value chain is misfiring just when it’s needed most: India’s monsoon rainfall. It might seem strange to liken the weather to a component of an industrial system, but that’s the way it has worked in India for millennia. The arrival of the southwestern monsoon during June is so weirdly regular that you can set a just-in-time agricultural calendar by it. Europeans had little warning of the heatwave currently bearing down on the continent until recently, but the near two-week delay in rains reaching Mumbai this week was enough to provoke nervous headlines.
Infrastructure projects worth above Rs 150 crore each registered a cumulative cost overrun of around Rs 5.4 lakh crore, according to a monthly government report for May 2026. A total of 1,987 ongoing infrastructure projects across 17 Central Ministries/Departments were monitored and it was found that the total revised cost was Rs 42.50 lakh crore compared to their original cost of Rs 37.09 lakh crore.
A weak monsoon is emerging as India’s next inflation risk, with a developing El Niño threatening to curb rainfall and push up food prices just as an easing oil relieves broader price pressures. The southwest monsoon, which accounts for about 70% of India’s annual rainfall, is vital for the $300 billion farm economy and has an outsized influence on food prices, rural demand and broader economic output.
The El Nino impact and the poor monsoons are among India’s biggest concerns at this juncture. The cumulative rainfall deficit has now widened to 42% below the long-period average. But economists pointed out that India seems better placed to handle this situation compared to past El Nino episodes. Moderate pick-up in sowing also added to the optimism .
Two days of ministerial-level talks between India and the US, aimed at finalising an interim trade agreement concluded here on Wednesday, but no clarity emerged on whether both sides managed to bridge the remaining differences. The discussions were led by Commerce and Industry Minister Piyush Goyal and US Trade Representative (USTR) Jamieson Greer.
The transfer of subsidies and welfare benefits through the Direct Benefit Transfer (DBT) system helped the government plug leakages worth Rs 83,064 crore in FY25, taking the Centre’s cumulative savings via this route to Rs 5.14 lakh crore, according to the latest government data. These savings have given government finance managers greater fiscal space to improve expenditure quality and extend additional welfare benefits to eligible beneficiaries without placing undue pressure on the exchequer.
Lengthy approvals, weak exploration intensity and infrastructure bottlenecks continue to hold back India’s mining sector despite the country being among the world’s leading producers of coal, iron ore, zinc and chromite, according to an Icra report released at the India Mines and Minerals Conclave 2026. The report identifies regulatory approvals and land acquisition as among the biggest impediments to faster mine development, with a typical coal mining project in India requiring around 48 months to secure statutory clearances and land acquisition.
SBI Research has said the West Bengal Budget for 2026-27 carries the most optimistic policy narrative in 17 years, marking a decisive shift from the redistributive framework that defined both the Left Front and Trinamool Congress rule. The BJP government in West Bengal sought to blend welfare continuity with political and administrative reset in its maiden budget presented on Monday, as it pledged to fill one lakh government vacancies and increase dearness allowance by 20 percentage points, while stressing the need for fiscal discipline.
The textiles ministry has stepped up efforts to position India as a global textile hub, drawing up a roadmap to achieve $100 billion in textile exports by 2030 with a focus on sustainability and free trade agreements (FTAs). Sustainability emerged as a key theme during the two-day summit concluded Wednesday, with stakeholders highlighting the growing importance of traceability, recycling and compliance with global environmental standards. Industry representatives recommended adopting digital product passports, developing textile recycling ecosystems, and establishing easier compliance norms for micro, small and medium enterprises (MSMEs).
The government will launch the Index of Service Production (ISP) next month, a new high-frequency indicator aimed at tracking growth in the services sector, with 2024-25 as the base year, the statistics ministry said Wednesday. The index will cover sectors like wholesale and retail trade, transport, banking, insurance, telecommunications, hotels & restaurants, real estate, professional, scientific and technical services, and arts, entertainment & recreation. “As counterpart of the IIP (Index of Industrial Production) which measures the economic growth of the industrial sector, ISP will cover the formal services sector and will be released on a monthly basis,” the ministry said in a statement.
Prime Minister Narendra Modi chaired the 52nd PRAGATI meeting, during which infrastructure works worth over Rs. 30,000 crore were reviewed. In a post on X, he said that ongoing development projects would provide fresh momentum to economic growth, connectivity and industrial progress, while emphasising the need for effective implementation of the PM Gati Shakti National Master Plan for their timely completion. "These works will add momentum to economic growth, connectivity and industrial progress. Emphasised the use of the PM Gati Shakti National Master Plan for the timely completion of development works. Other subjects reviewed include TB Mukt Bharat Abhiyan, grievances related to Cyber Crime and Digital Arrest," he said on Thursday.
The textiles ministry has stepped up efforts to position India as a global textile hub, drawing up a roadmap to achieve $100 billion in textile exports by 2030 with a focus on sustainability and free trade agreements (FTAs). Sustainability emerged as a key theme during the two-day summit concluded Wednesday, with stakeholders highlighting the growing importance of traceability, recycling and compliance with global environmental standards. Industry representatives recommended adopting digital product passports, developing textile recycling ecosystems, and establishing easier compliance norms for micro, small and medium enterprises (MSMEs).
You might think that the world’s supply chains are returning to normal now that oil appears to be flowing unhindered from the Persian Gulf for the first time in four months. Watch out for what’s happening on the far side of the Arabian Sea, though. The key input into another sort of value chain is misfiring just when it’s needed most: India’s monsoon rainfall. It might seem strange to liken the weather to a component of an industrial system, but that’s the way it has worked in India for millennia. The arrival of the southwestern monsoon during June is so weirdly regular that you can set a just-in-time agricultural calendar by it. Europeans had little warning of the heatwave currently bearing down on the continent until recently, but the near two-week delay in rains reaching Mumbai this week was enough to provoke nervous headlines.
India's economic growth is expected to decelerate to 6.6% in 2026-27 from 7.7% in the previous financial year, amid energy-related pressures, expectations of a below-average monsoon and slowing global growth, S&P Global Ratings said on Wednesday. Retail inflation is projected to rise to 5.1% this fiscal. The US-headquartered ratings agency expects gross domestic product (GDP) growth to recover to 7.2% in 2027-28. S&P's baseline forecast assumes that disruptions in the Strait of Hormuz will gradually ease during the second half of the year. While global oil prices are expected to remain elevated in the near term, they are projected to decline gradually and return to pre-Iran war levels by early 2028.
RBI may revise India growth to top 7% this year, MPC member says The easing in geopolitical tensions in the Middle East is poised to improve the outlook for Asia's third-biggest economy, reducing risks to both inflation and growth, Nagesh Kumar, an external member of the Reserve Bank of India's monetary policy committee, told Bloomberg in an interview. The reassessment marks a sharp contrast with about three weeks ago, when the RBI downgraded growth estimates for the year through March 2027 to 6.6% citing heightened uncertainty over the conflict in the Middle East.
India and the US on Tuesday held crucial ministerial-level discussions to advance negotiations on an interim trade agreement. The talks between visiting US Trade Representative (USTR) Jamieson Greer and Commerce and Industry Minister Piyush Goyal started in the morning and continued until late afternoon before both sides decided to take a break. Another meeting between the two is expected on Wednesday.
With global urea prices falling to pre-West Asia war levels, the government’s fertiliser subsidy budget in the current fiscal year is likely to be around Rs 2.5 lakh crore, down from the Rs 3.4 lakh crore projected earlier amid the conflict, official sources said An official with a leading state-owned fertiliser company told FE that with urea from Iran no longer under US sanctions, the price of the soil nutrient variant declined to around $ 415- 420/tonne on Tuesday, against the average price of $ 947/tonne prevailed in May 2026.
Private sector growth in the country slowed to a three-month low in June, as increasing costs and declining demand weigh on business momentum, according to a private survey released on Tuesday. The HSBC Flash India Composite Purchasing Managers' Index (PMI) fell to 57.4 this month from 59.3 in May. Readings above 50 signal expansion and those below the threshold indicate contraction.
India's trade grew at a healthy 5.4 per cent in Q4FY26 despite a slowdown in merchandise exports on strong growth in services exports and widening services trade surplus, as per the Trade Watch Quarterly report released by NITI Aayog on Tuesday. According to the report, India's merchandise trade showed mixed trends, with exports declining 2.8 per cent to $112.03 billion, while imports surged 12 per cent to $195 billion. However, India continued to maintain a strong services trade surplus of $60.4 billion, supported by a 9 per cent rise in services exports to $111 billion, compared with a 4.1 per cent increase in services imports to $50.7 billion. India's "total trade grew at 5.4% in Q4, FY2026, reaching $1.84 trillion," as per the report.
An adverse south-west monsoon, if it materialises, could weigh on India’s growth and inflation outlook, the Reserve Bank of India (RBI) said in its June Bulletin. The central bank noted that the global economic landscape remains fragile despite some relief from the interim US-Iran peace agreement. “Any breakdown of the agreement may reignite material risks in terms of inflationary expectations, disrupted critical energy infrastructure, delayed investment spending, food security concerns, adverse financial stability outlook and structurally lower growth,” the RBI said.
India does not negotiate trade deals with a deadline in mind but if there has to be a deadline for the agreement with the US, it should be for them as the additional tariffs imposed by the Trump administration expire on July 24, commerce and industry minister Piyush Goyal said Monday. The 10% additional tariffs were imposed by the US after the reciprocal tariffs were invalidated by the US Supreme Court under the Section 122 of the Trade Act. There tariffs can be imposed only for 150 days.
India’s core sector growth slowed sharply in May 2026, with the combined output of eight key infrastructure industries expanding by just 0.5% year-on-year, according to provisional data released by the Ministry of Commerce and Industry on Monday. The slowdown comes amid sharp declines in production across major sectors such as coal, crude oil, natural gas and petroleum refinery products, even as steel, cement and electricity generation posted healthy growth during the month.
ndia’s economic growth rate could get back to the 7%- plus range in FY27 if the West Asia peace endures and crude oil prices maintain the downward trajectory, Nagesh Kumar, external member of the RBI’s Monetary Policy Committee, has said, citing an improved macroeconomic outlook since the panel’s meeting on June 3-5. Kumar said the outlook for the Indian economy has brightened following the easing of geopolitical tensions in West Asia and the subsequent decline in crude oil prices from around $110 a barrel to below $80.
India may get relative relief from the United States’ Section 301 tariff, as the two sides agree shortly on the terms of the interim bilateral trade agreement. To reduce the tariff linked to forced-labour imports from the currently proposed 12.5%, New Delhi may need to strengthen the mechanism for supply-chain labour compliance, sources privy to the matter said. Currently, while domestic regulations proscribing forced labour are duly supported by law, due diligence on upstream supply chains are largely voluntary in nature. This deficiency may be addressed with a new set of norms.
India's private sector expanded at its slowest pace in three months in June as weaker demand growth weighed on both factory and services activity, while business confidence slipped to its lowest level since January, a survey showed. * HSBC's flash India Composite Purchasing Managers' Index (PMI), compiled by S&P Global, fell to 57.4 this month from May's 59.3. A PMI reading above 50.0 indicates expansion in activity. * Overall new orders, a key gauge of demand, rose at their slowest pace since March with firms citing competitive pressures and gas shortages as obstacles to securing business.
Micro, small, and medium enterprises (MSMEs), women entrepreneurs, and sustainable trade infrastructure are becoming central to India's growth, as it aims for global manufacturing and export leadership. Akanksha Sharma, Vice President-Sustainability for Subcontinent, Central Asia, Levant & Egypt at DP World, shared with The Economic Times Digital how skills development, logistics infrastructure, export preparedness, and environmental responsibility are collectively shaping a more inclusive and competitive Indian trade environment. Edited excerpts.
India's fragmented water governance structure, highly subsidised pricing and slow reallocation among sectors can result in water shortage and higher risk of sustained fiscal pressure, Moody's Ratings said on Monday. In a report, Moody's said allocation frameworks, which govern how water supply is prioritised, priced and distributed across households, industry and agriculture, are becoming a more important determinant of economic resilience in water-stressed systems because they influence how shortages are absorbed and how quickly supply stress translates into fiscal pressure. It also said that rapidly growing demand from data centers, driven by the expansion of cloud computing and artificial intelligence, is adding a further source of water-intensive industrial pressure that governments and utilities will increasingly need to accommodate.
Prospects of delayed kharif crop sowing and adverse impact on crop yield are looming large, as the southwest monsoon lost momentum after its onset earlier this month. Farmers in the rainfed regions of central India—especially Maharashtra (-82%), Jharkhand (-69%), Chhattisgarh (-67%), Madhya Pradesh (-48%) and Odisha (-47%)—are anxious because rainfall so far has been scanty or much below the benchmark long period average (LPA). If the monsoon does not revive and the deficiency is not bridged over the next few weeks, it would lead to considerable delays in sowing kharif crops such as pulses, oilseeds, paddy and cotton.
India’s oil imports from Russia are on track to hit a new record in June, as refiners continue to rely heavily on discounted Russian crude after supply disruptions in West Asia caused by the regional conflict. According to preliminary vessel-tracking data from commodity analytics firm Kpler, India imported an average of 2.6 million barrels of Russian oil per day in June so far. That accounts for 53.5% of the country’s total crude imports during the period.
Spot electricity prices on power exchanges fell below ₹1 per unit during solar hours on nearly 25% of the days in FY26, with prices touching near-zero levels across multiple time blocks, triggering a sharp shift in industrial power procurement and pushing participation by open-access consumers up by more than 50% year-on-year. The trend is reshaping power sourcing strategies across India’s manufacturing sector, where electricity accounts for as much as 50% of operating costs in energy-intensive industries such as cement, metals, automobiles, chemicals and paper.
India’s merchandise exports rose by about 15% during April-June 14 this year, Commerce and Industry Minister Piyush Goyal said on Sunday, signalling that outbound shipments have so far held up despite a difficult global trade environment. The full trade numbers for June will be released by the Commerce Ministry on July 15. “Even now, if we see April, May and 14 days of June. I have data until June 14, it is 15%,” Goyal said during an interaction with chartered accountants in Mumbai.
India is facing one of its most difficult monsoon seasons in more than a decade. A brutal heatwave has already strained farms, power grids and patience nationwide. Now the India Meteorological Department (IMD) has confirmed what markets had been dreading: an El Niño is taking shape over the Pacific. Rainfall is expected to stay below normal through the June-September season. The numbers are stark as IMD has pegged seasonal rainfall at 90% of the Long Period Average. The period between June 1 and June 16 has already run 35% short of normal.
Normalcy returned to India’s crude oil imports in June, boosted by record Russian shipments, recovering from a few months of disruptions that saw an unlikely mix of suppliers spanning Angola, Brazil, Iran and Venezuela moving to cushion the impact of logistical bottlenecks due to closure of the Strait of Hormuz. India imported slightly more than 5 million barrels per day (mbd) so far this month, above the average of 4.9 mbd between April 2025 and February 2026, according to energy cargo tracker Kpler. Oil ministry data, which differs marginally from Kpler estimates, pegged the average at 5 mbd. The start of the Iran war on February 28 saw India’s oil imports falling 14% to 4.5 mbd in March from 5.2 mbd in February, according to Kpler.
Around 10-12 of the 16 fertiliser cargo vessels stranded near the Strait of Hormuz crossed the waterway before Iran claimed to have shut it again on Saturday following Israeli attacks on southern Lebanon, traders said, raising hopes of a decline in prices with the increased supply. Global urea prices have already begun to soften. At the onset of the Iran war, eight urea, four diammonium phosphate (DAP), one ammonia and three sulphur vessels bound for India were stranded in the strait. "Some vessels carrying urea, ammonia and DAP have crossed the strait," said an importer of fertilisers, who did not wish to be identified.
India’s textile and apparel exporters expect the India-UK Comprehensive Economic and Trade Agreement (CETA) to create fresh growth opportunities, with industry players projecting double-digit growth in export volumes and India’s share of the UK textile market rising threefold to 10-15% over time. The clarity on the implementation of the trade pact comes at a time when stability is expected to return to West Asia, a key destination and transit route for Indian textile exports, strengthening the industry’s export outlook.
All six members of the RBI Monetary Policy Committee voted unanimously to keep the repo rate unchanged at 5.25% at its June 3-5 meeting, favouring to adopt a “wait and watch” approach rather than making a pre-emptive policy pivot amid global uncertainties and elevated crude oil prices. According to minutes of the committee’s meeting released on Friday, the panel said that they would await incoming data and closely monitor the developments before taking any rate hike decision. The meeting took place before the US-Iran agreement to end the war in West Asia.
India-Russia joint venture urea manufacturing project is on track, Russia’s Ambassador to India Denis Alipov said on Friday. Moscow is committed to ensuring uninterrupted supplies of various soil nutrients to the India, he added. The project, which will be located in Togliatti, Samara, Russia, involves urea manufacturing capacity of 2 million tonnes per annum. The entire quantity of the fertiliser produced will be supplied to India.
As a weakening rupee drives up the cost of imports from China, some Indian businesses, as reported earlier by The Economic Times, are exploring yuan-denominated settlements to mitigate foreign exchange pressures. However, exporters, risk experts, and economists tell ET Digital that adoption of the practice remains limited among micro, small and medium enterprises (MSMEs). Most businesses see localisation and supply-chain diversification as more sustainable strategies for managing currency volatility than moving away from the US dollar. Notably, the development comes as Indian manufacturers grapple with rising costs of imported raw materials and components amid currency volatility.
India and Uzbekistan have agreed to deepen trade, address non-tariff barriers and work towards doubling bilateral trade in next three years, the government said Friday, adding that pharmaceuticals, medical devices, auto and machinery are some sectors where New Delhi can increase its exports. The issues were taken up at the 14th Session of the India-Uzbekistan Intergovernmental Commission on Trade, Economic, Scientific and Technological Cooperation. India-Uzbekistan goods trade was $672.5 million in FY26.
The Reserve Bank of India's Monetary Policy Committee (MPC) unanimously kept the repo rate unchanged at 5.25% with a neutral stance at its June 2026 meeting, with external member Saugata Bhattacharya flagging mounting inflationary risks and calling for a risk management approach to monetary policy, according to minutes released by RBI on Thursday. In his statement, Bhattacharya said the balance of risks has "tilted towards embedding inflationary pressures" since the April 2026 review, even as the overall risk picture has not changed materially.
British High Commissioner to India Lindy Cameron on Thursday said the India-UK Free Trade Agreement (FTA) will deepen economic ties between the two countries, unlock new opportunities across sectors and strengthen the broader strategic partnership between the nations. The India-UK Comprehensive Economic and Trade Agreement (CETA) and the Double Contribution Convention (DCC), also known as the social security agreement, will come into force on July 15. Calling the pact a major milestone, Cameron told ANI the agreement goes beyond trade and has the potential to transform cooperation in areas such as defence, education, technology and science.
The beneficiaries pool of the Pradhan Mantri Garib Kalyana Anna Yojana (PMGKAY) is being rationalised. The names of 22.1 million people have been deleted across states from the list of those eligible for free ration under the scheme, a move that will allow better targetting of the food subsidy. Food Minister Pralhad Joshi said on Thursday that what was done is “rightful targeting.” He cited instances of ration cards issued in the names of deceased individuals and those who pay income tax availing themselves of the free ration facility.
With the southwest monsoon stalled over southern Maharashtra, India is facing a nationwide rainfall deficit of 41 pc between June 4 and June 18, according to the latest India Meteorological Department (IMD) data. The country has received just 42.6 mm of rainfall against the normal 72.2 mm during the above-mentioned period.
For decades, trade policy was mostly about lowering tariffs and signing free trade agreements (FTAs). Today, however, the global economy is being reshaped not only by tariffs but also by supply chains, critical minerals, technology partnerships, and geopolitical considerations. The era when countries traded simply because they were economically efficient is giving way to an era in which they trade with those they trust. The fact that India has secured multiple FTAs and Comprehensive Economic Partnership Agreements (CEPAs) with important trading partners, such as the United Arab Emirates (UAE), Australia, and the EFTA (European Free Trade Association) bloc, is highly commendable.
India’s micro, small, and medium enterprises (MSMEs) are increasingly looking beyond their first international sale and focusing on building sustainable global businesses. In an interaction with The Economic Times Digital, Abid Murshed, Market Leader-India at PayPal, a global digital payments platform, discusses the challenges Indian exporters face while scaling globally, emerging export opportunities, the role of trust in cross-border commerce, and how data and artificial intelligence (AI) help merchants make better business decisions. Edited excerpts:
India has the potential to increase exports to USD 200 billion to BRICS countries by 2030 from USD 96 billion in the last fiscal year, industry chamber Assocham said on Thursday. BRICS is an intergovernmental organisation comprising 11 major emerging economies: Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Iran, Saudi Arabia, UAE, and Indonesia.
The Comprehensive Economic and Trade Agreement (CETA) between India and the United Kingdom will come into force from July 15 with both sides reaching an understanding on the last-leg issues around Britain’s steel safeguard measures. The date for Entry into Force (EIF) of the agreement was announced by UK Prime Minister Keir Starmer and Prime Minister Narendra Modi after their meeting on the sidelines of the G-7 Summit at Evian in France.
India’s imports of Russian crude oil surged 21% month-on-month in May, driving the country’s total purchases of Russian fossil fuels to €5.8 billion ($6.7 billion) and reinforcing its position as Russia’s second-largest energy buyer globally, even as Moscow’s fossil fuel export revenues rose only marginally amid softer crude prices. The sharp increase comes at a time when Russian crude is becoming increasingly important for Indian refiners. According to the latest analysis by the Centre for Research on Energy and Clean Air (CREA), crude oil accounted for 83% of India’s total Russian fossil fuel imports, amounting to €4.8 billion ($5.55 billion) in May alone. Oil products contributed €550 million, while coal imports stood at €429 million.
Two new SEZ projects are slated to come up at the Kandla Special Economic Zone (KASEZ), Asia’s first export processing zone located in Gujarat, with proposals under active consideration by the Board of Approval. The projects have got inprinciple approvals by the Gujarat government. Of the two, a project proposed by Essar Power SEZ will have an initial investment of Rs 50 crore while the other, proposed by Arham SEZ (I) Pvt. Ltd. is pegged at Rs. 230 crore. According to details shared at a programme organised by KASEZ in Ahmedabad on Wednesday, Essar Power Limited has proposed a sector-specific biofuels and biorefiner SEZ in Khambhalia taluka and Arham SEZ (I) Pvt. Ltd has proposed a large multi-product SEZ at Vadala village.
Prime Minister Narendra Modi and US President Donald Trump directed their officials to work towards a balanced, mutually beneficial and commercially meaningful trade agreement at the earliest. The Ministry of External Affairs (MEA) said this on Thursday, a day after the two leaders held wide-ranging talks for the first time in 16 months on the margins of the G7 Summit in an attempt to rebuild the strained bilateral ties. US Trade Representative, Jamieson Greer, will be visiting India next week to take forward the talks on the proposed trade deal.
India is said to be in talks with multilateral lenders to secure about $2.5 billion in funding from existing credit lines as New Delhi tees up fresh sources of money after the Middle East conflict crimped its ability to step up spending. The World Bank and Asian Development Bank are in discussions to disburse loans worth $1.5 billion and $1 billion respectively, with announcements likely within the next two months, according to people familiar with the matter. The funding is largely to boost urban infrastructure and create jobs, they added, asking not to be identified discussing private matters.
The Indian Rupee climbed to 6-week highs of 94.28 per dollar, driven by strong central bank purchases and a slip in oil prices. Brent Crude slumped below the $80 per barrel mark. The currency finally closed trade at 94.52 per dollar. Oil prices have tumbled by more than 32% from their March peaks, as Brent crude futures were trading near the $79 per barrel mark, while the US contract for crude, West Texas Intermediate, was quoted around the $76 per barrel level. Lower oil prices are rupee-positive as they help ease the pressure on country’s import bill “Lower oil levels certainly helped, oil companies purchased during the first half of the trade,” said Anil Kumar Bhansali, head of treasury at Finrex Treasury Advisors. He added that heavy dollar buying by RBI was witnessed during the second half of the trade, during which the currency touched its fresh intraday high level.
India’s exports of agricultural and processed food products rose by 8% year-on-year to $ 4.51 billion during April-May period of the current fiscal year as shipments of buffalo meat increased sharply. Exports of rice, fruits and vegetables, however, declined in current fiscal because of the West Asia crisis. According to data from Directorate General of Commercial Intelligence and Statistics, the shipment of buffalo meat, dairy and poultry products in the first two months of FY27, increased sharply by 45% to $ 1.18 billion, while the value of rice exports including basmati and non-basmati varieties dropped marginally to S 2.04 billion on year.
Even in this global landscape of heightened volatility and uncertainty, strategic shifts are creating unique opportunities. India's 'China Plus One' gains have been uneven. But the smartphone success story demonstrates what's achievable when policy, infrastructure and investment align. Electronics leads. But integration can deepen across sectors like auto components, automobiles, pharma and engineering goods. India is well-positioned to capture a larger share of low- and mid-tech manufacturing as supply chains diversify. To achieve this, it requires a pragmatic stance on China. Proliferation of FTAs should also open an even wider market for exporters.
Su Shan Tan, the chief executive of Singapore-based DBS Bank, views India as a long-term structural growth story despite nearterm volatility. The country could benefit from the surge in global demand for memory chips and hardware driven by the artificial intelligence boom, but to capitalise on the opportunity, it must invest in people and education, she says. The bank infused Rs 1,600 crore in its India operations in March and remains committed to the country, stepping up investments in wealth, supply chain financing and client connectivity, she tells ET’s Joel Rebello & Sangita Mehta.
Sales of over 1,800 listed private manufacturing companies expanded by 14.5 per cent in the fourth quarter of 2025-26, mainly driven by automobiles, electrical machinery and non-ferrous metals industries, according to RBI data released on Tuesday. At the aggregate level, listed private non-financial companies continued to record a double-digit sales growth of 13.9 per cent during the January-March period of 2025-26, up from 10.1 per cent in the previous quarter.
New Delhi, Uttar Pradesh, Gujarat, Jharkhand, Manipur, and 9 other states recorded surplus revenues in 2024-25, while the remaining 15 states had a deficit. Eighteen states targeted revenue surplus, 3 states targeted revenue deficit, and 7 targeted zero revenue deficit in FY 2024-25, according to a report on 'State Finances 2024-25' released by Comptroller and Auditor General of India K Sanjay Murthy on Tuesday. "In FY 2024-25, 15 states were revenue-deficient while the rest 13 states were revenue surplus," the report said.
The conflict in West Asia is reshaping India’s trade flows in unexpected ways, triggering a dramatic reordering of both import sources and export destinations. The most striking shift has been Oman’s emergence as a key trade partner. Ranked only 30th among India’s import sources in April-May 2025, the Gulf nation has jumped to 10th place in the first two months of the current financial year. Imports from Oman surged 3.8 times to $3.4 billion, largely driven by energy shipments. The changes extend far beyond the Gulf. The UAE slipped to fourth place among India’s import partners, while Russia reclaimed the second spot, followed by the US. India’s search for alternative LPG supplies helped lift imports from the US, while purchases from Brazil rose 2.8 times to $2.7 billion. Imports from Peru climbed 3.7 times to more than $2 billion, making it India’s 20th-largest import source compared with 35th a year earlier.
States' aggregate expenditure rose sharply by 131 per cent between 2015-16 and 2024-25, keeping pace with economic growth, as they focused on welfare and development activities, said a CAG report on Tuesday. Revenue expenditure continued to dominate budgets, averaging over 83 per cent of total spending, while capital expenditure increased in absolute terms but remained a relatively smaller share. "Social and economic services together accounted for about two-thirds of total expenditure, reflecting states' focus on welfare and development," said the CAG's Publication on State Finances 2024-25.
India's merchandise trade deficit stood at $ 28.21 billion in May 2026, with lower crude oil prices and higher duties on gold imports likely to ease pressure on the import bill in the coming months, according to a report by Dolat Capital cited. According to ANI, the report noted that petroleum imports surged to $ 22.7 billion in May 2026, up from $ 14 billion a year earlier, even as non-petroleum exports rose to $ 70.7 billion during April-May FY27 from $ 64 billion in the corresponding period last year. Non-petroleum, non-gems and jewellery exports also increased to $ 65.9 billion from $ 59.2 billion.
The Centre’s fertiliser subsidy may not rise as much as it was earlier feared, with global prices declining after the announcement of the US-Iran peace deal, even as a weaker monsoon may lead to lower fertiliser demand as sowing may get hit. The fertiliser subsidy bill, initially feared to double to Rs 3.4 lakh crore, may eventually be around Rs 2.5 lakh crore this fiscal, as per newer estimates.
The US-Iran tentative deal to end their 107-day conflict and reopen the Strait of Hormuz could at once boost India’s economic sentiments, ease an already evident pressure on the fisc, avert an emergent balance of payments problem, and help the rupee to hold against the dollar, economists said. If supply chain normalises fast and let prices of key commodities decline like oil and LNG decline, the Reserve bank of India may opt for a moderate upward revision of its GDP estimate of 6.6% for the current fiscal year, many of them felt. However, they cautioned that things were still unfolding.
The recovery in shipment volume to West Asia after two months of decline and the high value of petroleum product shipments helped merchandise exports grow at the fastest rate in six months in May. Shipments rose 18% to $45.2 billion, and with the war in the region winding down prospects for the rest of the year look promising, government officials and trade circles feel. Exports to West Asia, which had fallen sharply to $2.62 billion in March as the war began, returned to last year’s level of $5.3 billion in May. “The May numbers are one of the highest monthly export data. Going by the trend, this year will be good for exports,’ Commerce Secretary Rajesh Agrawal said.
The progress of the southwest monsoon has been sluggish so far with cumulative rainfall until June 14 being just 28.4% below the benchmark longer period average (LPA) for the period. This is in the ‘deficient’ range, according to the India Meteorological Department’s criteria. This follows the late arrival of monsoon over Kerala on June 5 against the usual date of June 1. Finance Minister Nirmala Sitharaman on Monday expressed concern over the impact deficient rains would have on farmers’ income as the IMD has officially forecast a below-normal monsoon for 2026. “Of course, we have enough buffer stocks. Since last year we’ve maintained it, so there shouldn’t be a food shortage.
India’s trade deficit widened sharply in May 2026 despite a strong surge in exports, as rising imports outpaced gains in both merchandise and services trade, news agency ANI reported based on data released by the Ministry of Commerce and Industry. While exports touched record levels during the month, a steep increase in imports pushed the country’s trade gap significantly higher compared to the same period last year, underlining growing domestic demand and rising commodity costs, as per the data released by the ministry.
India will take more steps to spur foreign capital inflows, not stopping with the recent announcements made by the government and the Reserve Bank of India, Finance Minister Nirmala Sitharaman said on Monday. “We will be doing more. We recognise we need more foreign capital to come in,” she said at the Hero Mind Mine Summit here. On June 5, the government and RBI launched a coordinated, multi-pronged package to combat persistent Foreign Portfolio Investor (FPI) sell-offs, ease balance-of-payments (BoP) pressures, and stabilise the rupee. Through an Ordinance, the government scrapped 20% withholding tax on interest income on government bonds and the 12.5% long-term capital gains (LTCG) tax on foreign bond holdings
The US and Iran have agreed to a deal to end the conflict, with the agreement set to be signed in Switzerland on Friday, raising hopes of a reopening of the Strait of Hormuz and a revival of oil and gas flows from West Asia. The prospect of a peace deal has already pushed Brent crude down to around $83 per barrel, while analysts expect Asian spot LNG prices to fall by up to 40% to $12-15 per MMBtu from the current $18-20 range, potentially delivering significant relief to India’s energy import bill, inflation, subsidy burden and industrial fuel costs. The development is particularly significant for India, which imports more than 85% of its crude oil requirement and over 50% of its natural gas consumption. Nearly 20% of global oil and gas supplies move through the Strait of Hormuz, making any disruption a direct threat to India’s energy security and import costs. Analysts estimate that a $10 decline in crude oil prices can reduce India’s annual import bill by $13-15 billion.
India’s inflation trajectory is beginning to show signs of renewed pressure, with both consumer and wholesale prices rising sharply in May 2026 amid higher food costs, fuel price increases and global commodity volatility, according to separate research reports by HSBC and Bank of Baroda. While retail inflation remains within the Reserve Bank of India’s tolerance band for now, economists warn that a combination of rising energy prices, weather disruptions and global supply-side risks could push inflation significantly higher in the coming months.
Goldman Sachs has turned more optimistic on India's external position, lowering its current account deficit (CAD) forecast for 2026 to 1.3% of gross domestic product (GDP) from 2% earlier and projecting a balance of payments (BoP) surplus of 0.6% of GDP after two years of deficits. Despite lower capital inflows, India posted a $7.2 billion BoP surplus for the January-March period, supported by stronger remittances, robust services exports and reduced oil imports. According to Goldman Sachs, this reflected precautionary dollar demand amid heightened uncertainty in West Asia.
India recorded a current account surplus of $4.7 billion in April 2026, compared with a deficit of $4.8 billion a year earlier, even as net foreign portfolio investment (FPI) outflows widened to $8.7 billion and pushed the overall balance of payments into a deficit, according to preliminary data released by the Reserve Bank of India (RBI) on Monday. The surplus came despite a wider merchandise trade deficit of $27.9 billion in April 2026, compared with $27.1 billion a year earlier. Merchandise exports rose to $44.6 billion from $38.7 billion, while imports increased to $72.5 billion from $65.8 billion. Net services exports strengthened to $18.6 billion during the month, up from $15.9 billion in April 2025. Services exports stood at $37 billion, while imports were $18.4 billion.
India's export outlook remains challenging in FY27 amid moderating global demand and elevated electronics imports, but the worst phase appears to be behind as a weaker rupee, resilient services exports and strong remittance inflows are likely to cushion external sector pressures, according to a report by Elara Securities. The report noted that softer crude oil prices and easing freight costs in the coming months could help normalise India's import bill, providing some relief to the country's trade balance.
India’s unemployment rate climbed to an 11-month high of 5.5 per cent in May from 5.2 per cent in April, even as labour-force participation eased, suggesting a softening labour market, according to the latest monthly bulletin of the Periodic Labour Force Survey (PLFS), released by the National Statistics Office (NSO) on Monday. Key Labour Market Indicators Decline Notably, the labour-force participation rate (LFPR), which is the percentage of the population that is either working or actively looking for work, hit an 11-month low of 54.4 per cent in May, down from 55 per cent recorded in April. The LFPR rate in rural areas declined to 56.6 per cent during the month from 57.5 per cent in April, while in urban areas it decreased marginally to 49.8 per cent from 50.1 per cent.
India’s 100% import dependence on key minerals, over 90% reliance on China for graphite, and heavy supplier concentration across lithium, cobalt and copper are emerging as major risks for its s energy transition, with global supply disruptions threatening availability and costs. India remains fully dependent on imports for lithium, cobalt and nickel, leaving critical sectors exposed to geopolitical tensions, export controls and price volatility. The risks are amplified by concentrated sourcing — China accounts for over 91% of synthetic graphite imports, while Finland supplies nearly 60% of cobalt oxide and hydroxide imports, highlighting structural vulnerabilities in supply chains.
Artificial intelligence could prove more disruptive than earlier technological shifts because it can affect both knowledge-intensive professions and skill-based work, Chief Economic Adviser V Anantha Nageswaran has said. “AI can be more disruptive because it is coming for both cognitive and skill-based jobs,” Nageswaran told ANI, pointing out that the technology is no longer limited to automating routine factory or clerical work.
Prime Minister Narendra Modi and US President Donald Trump are expected to hold key discussions on a possible India-US trade agreement during their meeting on the sidelines of the upcoming G7 Summit 2026 in France, with senior American officials indicating that economic ties and ongoing trade negotiations will be a major focus.
Union Minister for Road Transport and Highways Nitin Gadkari, on Saturday (June 13), announced that India has given full legal recognition to 100 per cent ethanol blend fuel—a move that will allow vehicles to run entirely on ethanol and is expected to drastically reduce the country’s dependence on fossil fuel imports. Gadkari said, “the approval would enable ethanol to emerge as a “viable alternative to petrol,” helping India lower its burden of Rs 22 lakh crore in annual fossil fuel imports”. He was speaking at a press conference marking 12 years of Prime Minister Narendra Modi’s leadership.
Commerce and Industry Minister Piyush Goyal on Sunday sought investments from France in the manufacturing sector. Speaking at the 'Bharat Innovates' event in the presence of Prime Minister Narendra Modi and French President Emmanuel Macron in Nice, France, Goyal said India can offer a huge talent pool and scale for manufacturing. "I would invite our French friends to visit India, invest in India, design in India, innovate in India and manufacture in India, both for the large domestic market and export from India to the rest of the world," he said.
India’s agriculture sector is heading into a challenging season. Concerns over a potentially weak monsoon, the possible impact of El Niño, geopolitical tensions in West Asia, and rising input costs have reignited a longstanding debate over the sustainability of India’s fertiliser subsidy regime. against this backdrop, agricultural economist Ashok Gulati argues that the current system has become fiscally burdensome, heavily dependent on imports, and environmentally damaging, making comprehensive reform increasingly unavoidable.
India's wholesale inflation stood at 9.68% in May under a new series, while food and fuel prices stayed at elevated levels amid the continuing Middle East tensions due to the US-Iran war that inflated global crude prices and strained supply chains. India's wholesale inflation had accelerated to a 42-month high of 8.26% in April under the old series. A Reuters poll of economists had forecast a 9.05% annual increase in wholesale prices for May. India's wholesale food prices stood at 4.49% in May while fuel and power prices surged 30.33% in May.
Finance Minister Nirmala Sitharaman on Sunday said India continues to remain the world's fastest-growing major economy, while addressing the BJP's Viksit Bharat event in Bengaluru. The finance minister slammed Congress leader Rahul Gandhi, accusing him of "undermining" the achievements of India and its people while targeting Prime Minister Narendra Modi and the Centre.She alleged that Rahul Gandhi "ignores" India's achievements even in the face of major crises like COVID and the conflict in West Asia. Sitharaman clarified that there is no crisis awaiting in the country as is being portrayed by Rahul Gandhi.
Electronics could evolve from a rapidly growing export sector into the cornerstone of India's next manufacturing and export-led growth cycle, Yes Securities said, with Monte Carlo simulations showing a 55.2% probability of generating a high FTA Opportunity Score. The brokerage sees Engineering & Machinery and Pharmaceuticals as broad-based beneficiaries too, while Textiles, Gems & Jewellery and Specialty Chemicals face structural headwinds despite FTAs. "India's recent wave of FTAs marks a fundamental shift in economic strategy from cautious protectionism toward deeper global trade integration," Yes Securities said in a research report. To assess impact, it built an FTA Opportunity Score combining five dimensions: change in sectoral export share, structural trade competitiveness, export momentum, manufacturing growth, profitability relative to exports and FDI intensity. Monte Carlo tests ran 2000+ iterations by varying weights to check robustness.
The announcement that the US and Iran have finalised a deal to end their 107-day conflict and reopen the Strait of Hormuz is expected to boost India's exports to West Asia, which was severely impacted by the hostilities, spur manufacturing activity and help stabilise the rupee, according to exporters and experts. They said the announcement, if implemented successfully, would reduce pressure on India's import bill, ease inflationary covers and create a more conducive environment for trade. The peace agreement would be signed on June 19 in Switzerland.
Food inflation, as measured by the recently revised consumer food price index, rose sharply to 4.78% in May, primarily because tomatoes and ginger became costlier. Sequentially, the all-India Consumer Food Price Index (CFPI) rose by 0.91% in the month from the April level. Food inflation was 4.2% in April 2026, and it was in the negative territory for seven months through December 2025. Food inflation was 2.13% in January, when the new consumer price index (CPI) series with a base year of 2024 was introduced by the Ministry of Statistics and Programme Implementation.
India's new generation of Free Trade Agreements can act as a catalyst for manufacturing expansion, private capex revival and supply-chain integration, with Electronics, Pharmaceuticals and Engineering & Machinery Goods positioned as the strongest beneficiaries. Yes Securities said the agreements, combined with PLI schemes and "China+1" diversification, give India its clearest shot yet at achieving US$1 trillion in merchandise exports by 2030.
India's labour productivity gap with China has widened by more than USD 30,000 per worker since 2000, despite decades of strong economic growth, with the country yet to achieve the industry-led productivity transformation seen in economies such as China, South Korea and Vietnam, according to an Equirus Securities research report. The report, titled "Labour Productivity in Emerging Economies: Catch-up, Innovation, and now AI", said India's GDP per worker has more than tripled since 1995, but productivity gains have lagged behind some of its Asian peers.
India's inflation trajectory is giving the Reserve Bank of India more room to hold rates through Q1FY27, but food and fuel risks could still flip the script in H2. Yes Securities expects headline CPI for Q1FY27 to undershoot RBI's 4.2 per cent forecast as the May print at 3.93 per cent YoY and benign base effects keep the average low. However, building momentum in vegetables, core services and pump prices, plus the looming El Nino threat, means RBI will likely stay "data-dependent" rather than front-load any August rate hike.
India must expand its international engagement to realise its vision of becoming a USD 30 trillion economy by 2047, according to Union Minister of Commerce and Industry Piyush Goyal. Speaking at the closing session of the 5th Annual Meeting of the India Global Innovation Connect, the Minister emphasised that India's economic growth is not a zero-sum game. Instead, he argued that the country's trajectory is deeply linked to fostering strategic partnerships with developed nations, which stand to complement rather than compete with Indian industry.
Metals and mining giant Vedanta Resources is set for a historic restructuring that will see the $18 billion conglomerate split in four. In an exclusive interview with Saket Kumar, Sudheer Pal Singh and Asit Ranjan Mishra/Business Standard in New Delhi, Vedanta Founder and Chairman Anil Agarwal discusses the motivation behind the exercise, and explains why he thinks India's mining industry needs an overhaul.
India is currently witnessing a massive surge in its data centre buildout wave. Installed capacity has already tripled in five years. And if you thought that was incredible, there is an even bigger wave ahead. Committed investment for Data Centres has already crossed US$156 billion. Three of the world’s biggest tech companies Microsoft, Amazon and Google have together pledged $67.5 billion to build here. Most recently, Robin Khuda’s Air Trunk announced an investment of $30 billion into building data centres in India.
The World Bank has marginally raised its growth forecast for India to 6.6% for FY27 from 6.5% projected earlier, citing resilient domestic demand, even as it lowered its global growth outlook for 2026 to 2.5% amid escalating conflict in West Asia. In its June 2026 Global Economic Prospects report, the multilateral lender also revised upward its FY28 growth estimate for India by 0.6 percentage point to 7.2%. “Despite heightened uncertainty related to the conflict, economic activity in India remained robust early this year, supported by resilient domestic demand,” the World Bank said, adding that private consumption, particularly in rural areas, has remained strong, while urban demand is showing signs of recovery. The Bank noted that collections from domestic sales taxes have continued to rise steadily. To contain inflationary pressures stemming from higher energy costs and shortages of agricultural inputs, especially fertilisers, India has undertaken several measures, including reductions in fuel taxes.
The government may reassess the fertiliser subsidy budget for the current fiscal year following a softening of urea prices in the latest tender floated for soil nutrient imports, Aparna S Sharma, Additional Secretary, Department of Fertilisers, said on Thursday. “Whatever is indicated (the lower price bid in the urea tender) is based on preliminary estimates. “Presuming that trends remain the same, there is a definite case to reassess the fertiliser subsidy depending on the confirmation of the quantities to be imported,” Sharma said.
As India sharpens its focus on becoming a developed nation by 2047, the 11th Governing Council meeting of NITI Aayog on Thursday turned into a showcase of the diverse ambitions and development blueprints of states, with chief ministers presenting roadmaps centred on human capital, technology, infrastructure and inclusive growth. Chaired by Prime Minister Narendra Modi, the meeting revolved around the theme of “Inclusive Human Development for Viksit Bharat @2047”, with states outlining strategies tailored to their strengths while aligning with the national vision.
India is preparing for a wider-than-expected budget deficit this year, Bloomberg News reported on Friday, citing an official familiar with the matter, as the war in Iran drives up energy subsidy costs and adds pressure on government finances. Reuters could not immediately verify the report and has sought comment from India's finance ministry. Authorities are willing to let the deficit widen by as much as half a percentage point to 4.8% of gross domestic product compared with the 4.3% goal set in February, the report said.
India must expand its international engagement to realise its vision of becoming a USD 30 trillion economy by 2047, according to Union Minister of Commerce and Industry Piyush Goyal. Speaking at the closing session of the 5th Annual Meeting of the India Global Innovation Connect, the Minister emphasised that India's economic growth is not a zero-sum game. Instead, he argued that the country's trajectory is deeply linked to fostering strategic partnerships with developed nations, which stand to complement rather than compete with Indian industry.
Commerce and industry minister Piyush Goyal on Thursday said countries around the world are increasingly protecting their domestic industries, including in sectors such as steel, but India continues to navigate global trade challenges through dialogue, cooperation and trade partnerships. Speaking at the India Global Innovation Connect, he said such measures are part of global trade realities and are not unique to India.
Deeper cooperation in hydrocarbons could play a key role in helping India and the United States achieve their goal of expanding bilateral trade to $500 billion by 2030, according to a report released by the US-India Business Council (USIBC) and Grant Thornton Bharat. The report, titled Strengthening the India-US Energy Partnership: Unlocking Hydrocarbon Opportunities through Investment and Collaboration, said the two countries' energy relationship is evolving beyond a traditional buyer-seller dynamic into a broader traditional buyer-seller dynamic into a broader strategic partnership encompassing trade, investment, technology, infrastructure and energy security.
The National Capital Region (NCR) is set for a major urban transformation under the proposed Regional Plan 2041, which seeks to develop up to eight new smart townships and establish a high-speed transport network that would allow commuters to travel between Delhi and major NCR cities within 30 minutes. The plan, which is expected to be taken up for adoption by the NCR Planning Board (NCRPB) at its meeting on June 16, has been circulated among participating states. It outlines a long-term strategy to accommodate rapid population growth, reduce pressure on Delhi, and improve connectivity across the region through integrated urban development and modern transport infrastructure.
With state-run oil marketing companies (OMCs) losing an estimated ₹690 on every domestic LPG cylinder sold — translating into nearly ₹1.38 lakh crore annually — the Centre has launched a nationwide push to shift households from LPG to piped natural gas (PNG) in areas where city gas infrastructure is already available. In a letter to chief secretaries of all states and union territories, Petroleum Secretary Neeraj Mittal said recent developments in the Strait of Hormuz region have necessitated accelerated measures to reduce dependence on LPG and promote PNG as an alternative cooking fuel.
Private sector investment is showing signs of revival, with companies increasingly borrowing for expansion and infrastructure projects, Punjab National Bank (PNB) Chairman and Managing Director (CMD) Ashok Chandra said, stressing that the private sector has started "reposing faith" in the economy. In an exclusive interview with ANI, Chandra said the PNB has witnessed a sharp rise in corporate loan sanctions over the past year, indicating growing investment activity across multiple sectors.
India's GDP is likely to grow at 6.6 per cent in the current fiscal as compared to 7.7 per cent in FY26, on weaker investments and consumption growth and trade shocks from the West Asia crisis, BMI, a Fitch group company, said. According to government data released last week, GDP growth in FY26 accelerated to 7.7 per cent from 7.1 per cent in FY25, supported by healthy consumption and robust investment activity.
Despite mounting pressure from surging global commodity prices that could nearly double the Centre’s fertiliser subsidy bill to Rs 3.4 lakh crore and necessitate support of Rs 1.23 lakh crore for oil marketing companies, the government remains firmly in control of the fiscal situation and sees little risk to India’s growth momentum, senior officials said. Even as geopolitical tensions in West Asia and global trade uncertainties cloud the external environment, officials said the economy continues to be supported by resilient domestic demand and a strong underlying growth trajectory.
The central government has announced to provide financial support of about Rs 1.23 lakh crore to oil marketing companies to cushion losses triggered by the West Asia conflict and shield consumers from a sharper rise in fuel prices. However, no proposal has been made to curb capital outflow, PTI reported, quoting sources. The support covers the initial 78 days of the conflict and includes the impact of excise duty reductions, the agency said. As the war rages on, with no respite in sight, the fertiliser minister has also sought to double budgeted subsidy to Rs 1.77 lakh cr for FY27, sources told PTI.
Fitch Ratings has lowered its GDP growth projections for India amid the US-Israeli war against Iran. The credit rating agency estimates that the ongoing conflict will slow the economy in the September and December quarters. Fitch also projected 6.4% growth in the current fiscal — down from an earlier estimate of 6.7% in its June Global Economic Outlook. “We expect GDP growth to ease to 6.4% in FY27, a downward revision of 0.3pp from March. Domestic demand will be the main driver of growth, but lower imports in real terms imply positive contributions to growth from net external demand,” Fitch Ratings wrote. The estimates came even as the Reserve Bank of India cut its growth forecast for the current fiscal to 6.6% and upped its inflation projection to 5.1%. Fitch has also lowered its 2026 global growth forecast to 2.4% as an extended oil crisis hurts prospects.
India’s economic growth is expected to moderate in FY27 after accelerating to 7.7% in FY26. According to economists at Elara Capital, the improvement in FY26 was a cyclical recovery in demand rather than a structural shift in the economy. Motilal Oswal expect the FY27 growth to slow to 6.5% broadly in line with the Reserve Bank of India’s (RBI) revised estimate of 6.6%. The economists note that FY27 is facing headwinds since the beginning of the fiscal year unlike in FY26 where growth remained strong through most of FY26 and peaked at 8.3% in Q2 FY26 before moderating slightly in Q4 FY26.
Even as the country is said to witness a “balance of payments stress test” in the current fiscal year due to rising energy import bill, subdued exports and an unusually weak capital account, data revealed by the Reserve Bank of India (RBI) on Monday showed a surprise current account surplus in the fourth quarter of 2025-26. This resulted in a benign current account deficit (CAD) of 0.6% of the gross domestic product (GDP) in FY26, the same level as the year before, as against around 1% expected by many analysts. The Q4FY26 current account surplus reached $7.1 billion (0.7% of GDP) despite an $83.4 billion merchandise trade deficit. This surplus was supported by solid net services receipts of $60.4 billion and remittances of $43.5 billion.
Although the southwest monsoon is advancing up the west coast and interior peninsula, the prospect of El Niño-induced below-normal rainfall doesn’t augur well for the countryside and economy. The uneven spatial and temporal spread of rains will hit cultivation of kharif crops like paddy, coarse cereals, pulses, and soya bean among others. Lower rains that are 90% below the long period average (LPA) of 868.6 mm usually entail drought conditions. As if on cue, the Union ministry of agriculture and farmers’ welfare has already lowered the food grain production target for FY27. These prospects threaten the growth momentum of the agricultural sector that expanded by 4.1% per annum during the five years till FY26 due to a run of normal and above-normal monsoons, barring FY24.
The Centre has already mobilised close to Rs 20,000 crore through stake sales and asset monetisation in the first two months of the current financial year, as it looks to shore up revenues amid growing concerns over the fiscal impact of the conflict in West Asia, according to a TOI report. The amount raised so far accounts for roughly a quarter of the government's full-year target, reflecting a renewed push to generate non-tax revenues at a time when spending pressures are mounting. The urgency stems largely from rising energy and fertiliser costs.
The government plans to push ahead with reforms, including further measures to boost foreign investment, speeding up divestment and asset monetisation, as it seeks to preserve India's growth momentum in the face of rising fuel and fertiliser import costs triggered by the West Asia crisis, government sources said on Tuesday. They said that the country's GDP growth momentum remains intact, with domestic consumption holding up. "Growth is not under stress, but there are external challenges... Quarter after quarter, growth is showing momentum. Domestic economy is doing good, consumptions are not coming down...," the sources said.
India's exports have witnessed consistent growth in recent years, driven by supportive government policies, improved digital infrastructure, better logistics and trade reforms, a senior commerce ministry official said on Tuesday. Speaking at a regional media interaction organised by the Apparel Export Promotion Council (AEPC) and the Department of Commerce here, Senior Economic Adviser Agrim Kaushal highlighted the government's commitment to making India a global leader in the textiles and apparel sector. He referred to the Prime Minister's "5F vision" - "Farm to Fibre, Fibre to Factory, Factory to Fashion, and Fashion to Foreign" -- as a key framework guiding the sector's growth.
The Indian economy is facing headwinds from external sectors with rising fuel and fertiliser import bills due to West Asia crisis, but GDP growth momentum remains intact with domestic consumption holding up, government sources said on Tuesday. Sources said the FY27 Budget had taken into cognisance the uncertainties in the global economy around tariffs, and the government do not immediately need to account for additional borrowing or bring in supplementary demands for grants in the upcoming monsoon session of Parliament. On the fiscal deficit front, sources said the budgeted target of 4.3 per cent of GDP is still intact, and the government is actively tapping its non-tax revenue areas like disinvestment and asset monetisation in the current fiscal.
India has a strong foundation for economic growth and is expected to maintain robust growth momentum in the coming years despite global uncertainties, said Paul Procee, Operations Manager and Acting Country Director for India at the World Bank. Spea
The Centre has reduced the number of subsidised LPG refills available annually under the Pradhan Mantri Ujjwala Yojana (PMUY) from nine to four, officials said during an inter-ministerial briefing on Monday (June 8). The government cited a sharp increase in global liquefied petroleum gas (LPG) prices amid the ongoing crisis in West Asia as the reason behind the move. The move comes as state-run oil marketing companies (OMCs) face mounting losses on the sale of domestic cooking gas. According to the petroleum ministry, the effective cost of a domestic LPG cylinder has crossed Rs 1,600 based on international benchmark prices, while consumers continue to pay significantly lower rates.
India’s current account moved into a surplus of $7.1 billion in the March quarter of FY26, supported by stronger services exports and higher remittance inflows, according to Reserve Bank of India data released on Monday (June 8). The surplus was equal to 0.7% of GDP but it was narrower than the $13.7 billion surplus posted in the same quarter last year. The improvement on the services side and from remittances helped offset a larger goods trade gap. India’s merchandise trade deficit widened to $83.4 billion in Q4 FY26 from $59.3 billion a year earlier, reflecting higher import outgo.
India’s appetite for transport fuels remained largely unaffected by the steepest fuel price increase in nearly four years, with consumption of petrol and diesel continuing to rise in May despite cumulative retail price hikes of over ₹7 per litre and elevated global crude oil prices. Data released by the Petroleum Planning and Analysis Cell (PPAC) showed overall petroleum product consumption rose 2.38% month-on-month to 19.93 million metric tonnes (MMT) in May from 19.47 MMT in April, driven by higher demand for road transport fuels and aviation fuel.
State governments started 2026-27 on a cautious note, with an estimated 8% dip in their budgetary capital expenditure and moderate growth in revenue expenditure. Data compiled from 20 major states showed that aggregate capital expenditure fell 8.2% year-on-year to Rs 20,931 crore in April 2026, reversing the 15.9% growth recorded in the corresponding month of the previous year. The decline suggests that states may be prioritising fiscal prudence and preserving financial flexibility amid heightened global uncertainty and concerns over the impact of geopolitical tensions on growth, inflation and public finances.
India has launched E85 fuel as part of a wider plan to reduce dependence on imported crude oil. But the new fuel is meant only for flex-fuel vehicles, not regular petrol or E20-compliant cars. India’s E85 launch is not just another fuel station story. It is the Centre’s latest attempt to solve a much older problem: how to reduce the country’s dependence on imported crude oil without waiting for the transport economy to fully shift to electric vehicles.
India's inflation likely rose to the Reserve Bank of India's medium-term target of 4% in May, driven by a pickup in vegetable prices and higher fuel costs following the U.S. and Israel war against Iran, a Reuters poll of economists showed. Inflation has remained below the RBI's 4% target for 15 consecutive months. But that benign trend is unlikely to continue, with state-owned fuel retailers raising fuel prices four times in May alone, pushing up transport costs, while food inflation continued to rise from last year's low levels.
India's currency has tumbled to record lows this year because of pressure on the economy's balance of payments (BoP), prompting steps by authorities to try to cool dollar outflows. A surge in oil prices following the Iran conflict and selling of Indian stocks by foreign investors are likely to widen the BoP deficit this financial year, economists say.
India's growth momentum remains strong and fears that crude price shocks will derail it are a "narrative problem, not reality," said Neelkanth Mishra, India's newly appointed Executive Director at the World Bank. In an exclusive interview with ANI, Mishra spoke on Indian economy's outlook amid West Asia tensions, he argued that India is better placed than most energy importers to absorb higher oil prices without major damage to growth. Mishra is also a member of the Prime Minister's Economic Advisory Council and is widely known for his work as an economist and market expert.
India's gross domestic product growth is expected to moderate to around 6.5 per cent in FY27 as higher input costs, geopolitical tensions, and a weak monsoon bite, according to recent research reports by brokerage firms Dolat Capital and ICICI Global Markets. The risk is less about supply availability and more about the landed costs of crude and inflation being passed to consumers. Dolat sees agriculture GVA slowing to 1.2 per cent YoY in FY27 if IMD's forecast of 90 per cent of LPA monsoon under El Nino plays out, while softer Middle East demand could hit exports. ICICI flags weaker exports, rising input costs and potential El Nino disruptions as key headwinds, though private consumption and capex should keep growth above 6 per cent.
Urban consumers turned more pessimistic about the economy, jobs and spending in May, while professional forecasters lowered India's growth outlook, pointing to emerging signs of softer demand and weakening sentiment, according to Reserve Bank of India (RBI) surveys released on June 05. The RBI's Urban Consumer Confidence Survey (UCCS) showed consumer confidence for the current period fell for the third consecutive round, with the Current Situation Index (CSI) declining to 90.7 in May from 95.7 in March.
The Reserve Bank of India's announcements after the monetary policy committee meeting are some measures aimed at flipping the rupee narrative from depreciation risk to inflows, SBI research and Kotak Securities said in their respective research reports. SBI projects at least $40 billion of capital flows that could pull the rupee back toward 92-93 levels, while Kotak estimates the full package may bring $50-75 billion. Both houses expect the MPC to pause in August, keeping the repo rate at 5.25% with a "neutral" stance, even as inflation vigilance rises and growth forecasts are trimmed.
Highlighting the deep-seated historical and strategic ties between the two nations, External Affairs Minister S Jaishankar on Sunday stated that the visit of Indonesian President Prabowo Subianto as the Republic Day Chief Guest in 2025 has imparted fresh momentum to the bilateral Comprehensive Strategic Partnership. Welcoming the Indonesian delegation for the 8th India-Indonesia Joint Commission Meeting (JCM), which is being held after a gap of four years, Jaishankar outlined the vast potential for multi-sectoral cooperation.
Economist Ashok Kumar Lahiri, who took over as vice chairman of NITI Aayog ☐ last month, believes India's growth debate is focused on the wrong question. Rather than looking for ways to boost consumption, Lahiri said policymakers should focus on increasing investment by accelerating reforms and removing obstacles to capital flows. In an exclusive interview with Surojit Gupta and Nalin Mehta, Lahiri made the case for an investment-led growth strategy, pointing to India's relatively low Investment rate, compared to those of the East Asian Tigers and China when they were at similar economic levels.
Commerce and Industry Minister Piyush Goyal has said India-US trade negotiations are moving “extremely well”, but warned that the final value of the deal will depend on whether Indian exports are burdened by additional tariffs under the US Section 301 process. Speaking at the FE Best Banks Awards 2026, Goyal said the two sides had made strong progress and that a deal would come through. However, he indicated that India is closely watching the tariff structure Washington may impose under Section 301, as cumulative duties could reduce the advantage created by the trade agreement.
India’s economy grew 7.8% year-on-year in Q4FY26, and 7.7% YoY in FY26, according to the provisional estimates released by the Ministry of Statistics and Programme Implementation (MoSPI) on Friday. India’s real Gross Domestic Product (GDP) in Q4FY26 is estimated to grow at Rs 87.77 lakh crore, up from Rs 81.40 lakh crore in Q4FY25, showing a growth rate of 7.8%. Nominal GDP expanded 9.1% during the quarter to Rs 94.65 lakh crore. real GVA estimated to grow 7.9%, while nominal GVA increased 9.9%.
Union Petroleum and Natural Gas Minister Hardeep Singh Puri on Friday announced the finding of natural gas in the Andaman Sea, a development that could strengthen India’s efforts to increase domestic energy production and reduce dependence on imported fuel. The discovery was made at the Sri Vijayapuram-3 exploratory well drilled by Oil India Ltd around 15 kilometres off the east coast of the Andaman Islands. According to the minister, the well was drilled in waters about 355 metres deep, and initial testing confirmed the presence of natural gas.
In a sweeping and coordinated response to the mounting pressure on the rupee, the Centre and the Reserve Bank of India on Friday unveiled a package of measures designed to attract dollar inflows, arrest the currency’s slide and finance a current account deficit that could nearly double to 2% of GDP this fiscal year if crude oil prices remain elevated around $95 per barrel. RBI Governor Sanjay Malhotra left little doubt about the central bank’s resolve. “We shall remain vigilant, and we are fully prepared to do whatever it takes to preserve orderly market conditions,” he told reporters. He also ruled out any restrictions on capital outflows, saying no such measures were under consideration.
Petrol and diesel prices may need to be raised by another ₹5 per litre despite multiple hikes over the past three weeks, as state-run oil marketing companies (OMCs) continue to incur under-recoveries of around ₹610 crore every day amid elevated crude oil prices and fuel losses triggered by the West Asia crisis. According to Prashant Vasisht, Senior Vice President and Co-Group Head, Corporate Ratings, ICRA Ltd, OMCs are currently losing around ₹5.5 per litre on petrol and ₹4.5 per litre on diesel, even after cumulative retail fuel price increases of about ₹7.5 per litre since May 15.
Reserve Bank of India Governor Sanjay Malhotra and four Deputy Governors, in the post policy press conference on Friday said, the central bank remains committed to its 4% target despite a higher inflation outlook. They also expressed confidence that measures announced to attract foreign currency inflows will support a stronger balance of payments position. Malhotra said the RBI expects healthy inflows through ECB and FCNR(B) deposit schemes and will remain data-dependent on future policy actions. Excerpts:
While the Reserve Bank of India (RBI) held the policy repo rate steady for a third straight meeting, it raised its inflation forecast for FY27 by 50 basis points to 5.1%. However, most economists still anticipate the central bank will begin tightening in the second half of the year. Sakshi Gupta, principal economist, HDFC Bank, said policy could be assessed as slightly hawkish given the 50bps upward revision in the inflation forecast to 5.1% for FY27. “This raises the likelihood of the rate hike cycle beginning by the October policy. We estimate a cumulative 50bps rate increase in FY27.” She added that the central bank recognised the downside risks to growth due to supply chain disruptions and increase in price pressures.
India’s government and central bank took coordinated steps on Friday to spur foreign inflows, providing an immediate boost to the beleaguered currency. The challenge for policymakers will now be to sustain those flows in the face of economic threats beyond their control. The double-barreled intervention by authorities was hailed by investors as significant enough to spur as much as $50 billion into Indian bonds and stocks this year and reverse an outflow that’s dragged the rupee to a record low. The currency and bonds rose on the news.
India could return to a growth rate above 7% by FY28 if macroeconomic stability is maintained and supply-side measures continue, Chief Economic Adviser V Anantha Nageswaran said on Friday, even as rising global uncertainties weigh on the near-term outlook. His comments came hours after the Reserve Bank of India (RBI) cut its GDP growth forecast for FY27 to 6.6% from the 6.9% projected in April, citing higher energy and commodity prices along with persistent supply disruptions linked to the conflict in West Asia.
India’s government and central bank took coordinated steps on Friday to spur foreign inflows, providing an immediate boost to the beleaguered currency. The challenge for policymakers will now be to sustain those flows in the face of economic threats beyond their control. The double-barreled intervention by authorities was hailed by investors as significant enough to spur as much as $50 billion into Indian bonds and stocks this year and reverse an outflow that’s dragged the rupee to a record low. The currency and bonds rose on the news.
India’s government is weighing spending cuts across parts of the budget as higher oil prices inflate subsidy bills and threaten to derail its fiscal consolidation plans, according to officials familiar with the matter. The options have been reviewed in meetings with Finance Minister Nirmala Sitharaman over the past month, although no decision has yet been made, the officials said, asking not to be identified because the discussions are private.
The Centre is ready to take more policy measures to help insulate the economy from the adverse impact of the West Asia conflict and will phase it out instead of rushing with announcements. The focus of these steps will be to ensure that there is enough availability of goods, raw material, inputs and finished products, to meet the domestic requirement, while seeking to provide stability to the Indian currency and foreign exchange flows.
At a time when global uncertainties continue to keep financial markets on edge, the Reserve Bank of India (RBI) has announced a slew of measures aimed at attracting more foreign capital into the country. The announcements came alongside the central bank’s latest monetary policy decision, where the Monetary Policy Committee (MPC) decided to keep the repo rate unchanged at 5.25%.
India and Venezuela on Thursday agreed to deepen energy cooperation and explore a long-term partnership across the oil sector, as New Delhi ramps up crude diversification and Venezuela emerges as one of the country’s fastest-growing sources of crude supplies. At a press conference following Prime Minister Narendra Modi’s meeting with Venezuelan Acting President Delcy Rodriguez, the Secretary (East) at the Ministry of External Affairs, Rudrendra Tandon said that the discussions focused on forging an energy partnership.
The government is reinforcing its import substitution policies, even as tariffs for foreign goods are being whittled down under a flurry of bilateral free trade agreements. It has constituted six working groups to finalise a list of 100 products currently not being manufactured in India at the required scale for focused policy support to boost local production. The six groups will focus on electronics, pharmaceuticals and medical, capital goods, auto and electric vehicles, advanced capital goods, chemicals, construction equipment, defence and aerospace, and energy.
The newly elected United Democratic Front (UDF) government on Thursday tabled a White Paper on Kerala’s finances in the state Assembly, revealing mounting public debt, rising liabilities and persistent treasury stress that together paint a worrying picture of the state’s fiscal health. According to the report, Kerala’s total public debt has surged to Rs 5.07 lakh crore, while pending liabilities stand at Rs 48,733 crore, including unpaid dearness allowance (DA) and dearness relief (DR) arrears owed to government employees and pensioners.
Aditya Birla Group Chairman Kumar Mangalam Birla said India is passing through a historic phase of transformation that offers a once‑in‑a‑generation opportunity to emerge as a global economic powerhouse. While speaking at the public valedictory of the RSS Karyakarta Vikas Varg‑Dwitiya at Reshimbagh Ground in Maharashtra’s Nagpur, the industrialist highlighted the country’s demographic strengths, infrastructure expansion, digital reforms and financial inclusion as the pillars of this “Amrit Kaal” vision. “India today benefits from a rare convergence of demographic dividends, favourable economic tailwinds, world‑class infrastructure development, digital public platforms and financial inclusion,” Birla said. “Together, these factors provide a historic opportunity to take the country to new heights.”
India and the US on Thursday wrapped up another round of discussions on an interim trade deal, as both sides sought to bridge gaps in their respective positions. A statement issued by the government after the conclusion of the bilateral talks that began on Monday was, however, non-committal on whether India’s demand for a tariff advantage in the US market in relation to its key Asian competitors was accepted by the US side. On Wednesday, even as the talks were on, Washington proposed additional duties of 12.5% on 44 countries, including India, under Section 301 of its Trade Act for their alleged failure to enforce a ban on forced labour.
The Reserve Bank of India on Friday unveiled a series of measures aimed at attracting more foreign capital into the country, as policymakers seek to strengthen external finances amid global uncertainty and pressure on the rupee. The steps, announced by Governor Sanjay Malhotra after the monetary policy decision, include wider access for foreign investors to government bonds, easier investment rules for overseas Indians and foreign residents, and incentives for companies and banks to raise funds from abroad.
The Reserve Bank of India on Friday lowered its FY27 GDP growth forecast to 6.6% from 6.9%, citing rising risks from the ongoing West Asia conflict, elevated energy prices, supply disruptions and weather-related uncertainties, while keeping the benchmark repo rate unchanged at 5.25%. The central bank now expects GDP growth of 6.6% in the first quarter, 6.3% in the second quarter, 6.5% in the third quarter and 6.8% in the fourth quarter of FY27.
The Reserve Bank of India in Friday's monetary policy review revised its inflation forecast upward for FY27, reflecting the sharp uptick in food prices and retail inflation readings amid the ongoing West Asia crisis. Amid global uncertainties, the RBI has projected consumer price inflation (CPI) at 5.1% for FY27, up from 4.6% estimated in the April policy review.
Consumer-facing businesses are bracing for turbulence. A weakening monsoon forecast—driven by El Niño conditions—threatens to erode rural demand, the one engine that has kept FMCG companies, automakers and appliance manufacturers moving even as urban recovery sputtered. With the festive season on the horizon, the stakes could not be higher.
The US has proposed an additional 12.5% Trump Tariff on imports from India and 43 other countries, on the grounds their exports contain inputs produced by forced labour. The move is seen as an attempt by the US administration to retain leverage in ongoing trade negotiations. The proposed duties, announced after an investigation into the policies of 60 countries that together account for more than 99% of US imports, will replace the existing 10% tariff imposed under Section 122 of the Trade Act. Those duties are due to expire on July 24. For 16 other countries covered by the investigation, the US has proposed an additional tariff of 10%.
India could face higher inflationary pressures in FY27 as deficient monsoon rains and persistent heatwave conditions threaten agricultural output across major crop-producing regions, economists have warned. In its latest monsoon forecast, the India Meteorological Department (IMD) projected rainfall during the June-September season to remain 10% below normal, or around 90% of the long-period average (LPA). The revised estimate is weaker than the IMD‘s earlier forecast of rainfall being 8% below normal.
State Bank of India Chairman CS Setty on Wednesday said that a pause in the policy rates by the Reserve Bank of India’s monetary policy committee would help stabilise conditions and support economic growth. “Broadly, the market expects that there could be a rate pause at this juncture. Inflation dynamics remain important, but I think a pause would definitely help stabilise conditions and ensure smooth growth,” Setty said at the Citi India Conference 2026. The three-day MPC meeting will announce their outcome on June 5.
Former International Monetary Fund (IMF) chief economist and Deputy Managing Director Gita Gopinath has warned that elevated oil prices could trim India’s growth down toward 6 per cent, below the International Monetary Fund’s current forecast of 6.5 per cent, as higher energy costs sap consumption and investment. Gopinath said the effects of the oil price shock are likely to persist well into next year and that a prolonged conflict in West Asia could make the downside risks substantially worse.
The India-Oman trade pact provides significant market access opportunities for the textiles and apparel sector, placing India in a strong position to expand its exports and consolidate its presence in a key Gulf market, the government said on Wednesday. The India-Oman Comprehensive Economic Partnership Agreement (CEPA), which came into force on June 1, 2026, marks a major milestone in strengthening the economic and strategic partnership between the two countries.
The government is already supporting the economy amid the ongoing West Asia crisis by not allowing the full impact of rising global oil prices to be passed on to consumers, according to Gita Gopinath, former Deputy Managing Director of the International Monetary Fund (IMF). In an exclusive interview with ANI, Gopinath said the limited increase in retail fuel prices by the Indian government, despite a sharp rise in international crude oil prices, has effectively acted as an implicit subsidy for households and businesses.
India's target of achieving 500 GW of non-fossil fuel capacity by 2030 could generate more than 44 lakh full-time equivalent (FTE) jobs, with rooftop solar emerging as the single largest employment generator, accounting for nearly 43% of the total, according to a new study. The findings are significant as rooftop solar gains momentum across the country.
India's economy has remained resilient despite geopolitical tensions, supply-chain disruptions and volatile commodity prices, supported by strong industrial and services activity, broad-based demand and improving corporate performance, RBI Deputy Governor Swaminathan J said. In a speech at the School of International and Public Affairs (SIPA), Columbia University, the Deputy Governor said inflation remains within the Reserve Bank of India's tolerance band and external-sector vulnerabilities are manageable.
Coal gasification has so far saved Rs 28,000 crore in foreign exchange by reducing reliance on imported oil, methanol and ammonia, govt said recently as it prepares to launch the second phase of the programme. At a recent meeting with investors, coal ministry said the first phase of scheme, launched in 2023-24, had mobilised Rs 85,000 crore in investments and enabled utilisation of 23 million tonnes of coal annually.
A sharp rise in retail petrol and diesel prices since mid‑May could add materially to India’s consumer price inflation, Crisil warned, even as the Reserve Bank of India’s Monetary Policy Committee (MPC) may initially look through the supply‑side shock. The rating agency estimated the direct impact on the Consumer Price Index (CPI) at roughly 36 basis points for a Rs 7.5/litre increase in fuel costs, rising to about 48 basis points if retail prices climb by Rs 10/litre. Retail fuel surge and inflation mathematics Retail petrol and diesel prices in India have climbed by around Rs 7.5 per litre since May 15 and Crisil said further hikes are possible if crude oil remains elevated. “The direct upside to inflation linked to CPI is estimated at ~36 basis points (bps) with a hike of Rs 7.5/litre in petrol and diesel prices, rising to ~48 bps if the retail fuel prices increase by Rs 10,” the report said.
India’s services sector expanded at its fastest pace in six months in May. The HSBC India Services PMI rising to 59.8 from 58.8 in April amid stronger demand and higher new business inflows. The HSBC India Composite PMI Output Index, which tracks both manufacturing and services activity, also rose to 59.3 in May from 58.2 in April, signalling broad-based strength in private sector activity.
The US has reduced duties on agriculture and construction equipment to 15% from 25% through a proclamation signed by President Donald Trump. The tweaks are, however, expected to have a limited impact on India as its exports of the items that will attract lower duties is less than $ 50 million a year. The Proclamation adjusts the tariffs on agricultural equipment, like combines and harvesters, as well as certain other equipment, from 25% to 15%. It also expands the existing category of industrial equipment subject to a 15% tariff to include mobile industrial equipment, like bulldozers and forklifts, when imported from trade deal countries that are entitled to such treatment.
After more than a decade of preparatory work, the Producer Price Indices (PPI) is finally ready for launch and will be unveiled for the first time along with the revised Wholesale Price Index (WPI) on 15th of June. The PPI will have three indices – Output PPI, Trial Input PPI and Services PPI. Output PPI and Trial Input PPI will be released monthly and Services PPI will be compiled on a quarterly basis.
Economists across CareEdge, Bank of Baroda, and Kotak Institutional Equities warn that the macroeconomic outlook has deteriorated meaningfully since the West Asia conflict began, with a weak, El Nino-hit monsoon and rising fuel costs threatening to compound the strain in the first quarter of FY27. The grim outlook comes despite India’s growth moderating in Q4FY26. Economists believe that in the March quarter the economy remained partially shielded from the adverse effects of geopolitical tension as the war started in late February. Progress on the global trade front and companies’ reliance on existing inventories also helped cushion the impact of rising input costs.
The Reserve Bank of India‘s bi-monthly Monetary Policy Committee (MPC) meeting will begin on June 3. The three-day meeting will conclude on June 5, with RBI Governor Sanjay Malhotra announcing the key policy decisions. Analysts expect the RBI to pause rather than a hike despite rising inflation risks from higher fuel prices, a depreciating rupee, and elevated global energy costs. Here’s why. RBI unlikely to hike rates to defend the rupee Nomura expects the RBI to opt for a hawkish pause, arguing that interest rates are not an effective tool to defend the currency; also their primary mandate is to control inflation and support economic growth, rather than target a specific exchange rate.
The US government has proposed an additional tariff of 12.5% on India, even as its trade negotiators are in Delhi for negotiations with their counterparts. The recommendation came from the Office of the US Trade Representative following an investigation into “forced labour” practices in various countries. Most US trading partners would face a 10% levy under the proposal, while India and 53 other nations (including China, Japan, South Korea, Brazil and Switzerland) face a higher tariff rate. “For economies that impose a forced labor import prohibition, that have committed to impose and enforce such a prohibition through an Agreement on Reciprocal Trade, or economies that have imposed a partial regime with the effect of preventing the importation of certain forced labor goods, the U.S. Trade Representative proposes 10% as the rate of additional duties. For all other economies, the U.S. Trade Representative proposes 12.5% as the rate of additional duty,” USTR wrote in a statement.
A delegation of UK trade officials, led by Secretary of State for Business and Trade Peter Kyle met Commerce Minister Piyush Goyal amid new irritants emerging in the path of operationalising the Comprehensive Economic and Trade Agreement (CETA) between the two countries. “Had great conversations on charting the next phase of India-UK economic engagement, advancing shared business priorities, and further strengthening our robust and forward-looking partnership,” Goyal who led the Indian delegation posted on ‘X’.
India remains engaged with the United States on the ongoing Section 301 proceedings related to forced labour issues, the commerce ministry said on Wednesday, as the two countries continue negotiations on a proposed bilateral trade agreement. The statement comes after the Office of the United States Trade Representative (USTR) proposed additional tariffs on imports from 54 economies, including India, under investigations examining whether countries have imposed and effectively enforced prohibitions on goods produced with forced labour.
Rajasthan is witnessing a major infrastructure expansion with 81 projects worth ₹2.72 lakh crore currently under execution, according to the Project Monitoring Group report of the Ministry of Statistics and Programme Implementation. The projects span railways, highways, energy transmission, petroleum, and civil aviation, making the state one of India’s largest ongoing infrastructure investment hubs. Officials say these projects aim to improve connectivity, logistics, industrial growth, and energy security across the state.
Amid global uncertainties, the Centre stepped up capital and revenue expenditure in April, leading to a near doubling of the fiscal deficit year-on-year to 21.4% of the annual target, according to official data released on Monday. Data for the first month of FY27 showed that the Centre achieved 6.2% of the annual target in net tax revenues compared with 6.7% in the year-ago month. During the month, non-tax revenues were 3.6% of the annual target, compared to 11.5% in the year-ago month.
Oman is ready to consider diverting its share of the production of the Oman India Fertilizer Project (OMIFCO) entirely to India if a request comes, Advisor for Foreign Trade and International Cooperation at Oman’s Ministry of Commerce Pankaj Khimji said on Monday. OMIFCO is a joint venture between IFFCO, KRIBHCO, and the Oman Investment Authority that became operational in 2006. For 15 years all its production was for India. Now Oman sells its share of the output on a trading platform.
For nearly two decades, India’s economic rise has largely been celebrated through the lens of consumption. A growing middle class, rapid urbanisation, digital adoption, rising incomes and aspirational spending transformed the country into one of the world’s most attractive consumer markets. Global businesses looked at India as a vast marketplace—a nation of buyers, users and consumers.
India's CPI inflation is expected to rise by around 70 bps to 4.8 per cent with crude oil averaging USD 90/bbl in FY27, according to a report by 360 ONE Capital. This projection comes as the ongoing conflict in West Asia and a downgraded domestic monsoon forecast introduce fresh challenges to India's macroeconomic trajectory.
The April factory output data denotes that industrial activity is largely being supported by capex and construction-related demand than by a fully broad-based consumption cycle, economists say. Economists expect support from government capex to continue driving momentum in IIP growth in the coming months, while consumption growth may remain modest.
India's trade deal with Oman, which came into effect on June 1, could help New Delhi secure fertiliser supplies amid West Asia conflict that has hit disrupted supplies, industry sources said. The India-Oman Comprehensive Economic Partnership Agreement (CEPA) removes tariffs on 99 percent of Indian exports while paving the way for deeper investment ties.
India’s economy is expected to remain resilient in 2026-27 despite rising geopolitical tensions and a weakening global environment. However, a prolonged conflict in West Asia could weigh on growth, inflation and key sectors, according to the Reserve Bank of India’s annual report. “The adverse impact of outbreak of the conflict in West Asia in end-February 2026 is reflected in the forecasts of global growth and inflation,” the RBI said.
India’s energy investment is projected to hit a record $170 billion in 2026, driven by rapid expansion in solar photovoltaic (PV) capacity and a surge in oil‑refining projects, as per a report by International Energy Agency (IEA) said. Energy spending in India has risen at an average annual rate of 11% over the past five years, with solar PV investment up about 25% annually and oil‑refining investment growing roughly 23% in the same period.
India is likely to introduce a mandate for blending isobutanol with diesel as early as this year, a move that could have a bigger impact on the country’s energy security than ethanol blending in petrol given diesel consumption is nearly twice that of petrol, said Road transport and highways secretary V Umashankar. Speaking at the CII Multimodal Transportation and Logistics Summit in New Delhi on Friday, Umashankar said the government was examining diesel blending with “great seriousness” and early results from ongoing trials were encouraging.
India’s crude oil imports rose 11.2% month-on-month to 5.04 million barrels per day (mbd) in May, the highest level since the outbreak of the Iran conflict and potentially the strongest-ever import volume for the month, as refiners stepped up purchases of Russian and Venezuelan crude while rebuilding domestic inventories. Kpler data showed crude imports increased by about 509,000 barrels per day from 4.53 mbd in April and were significantly higher than the country’s 2025 average import level of around 4.8 mbd.
The Centre is expected to announce a slew of measures within a week to boost foreign capital inflows and stem outflows, in a move that will help support the rupee and make it easier to finance a widening current account deficit. While the exact details are still being worked out, sources said more than a dozen proposals are under discussion. These include a reduction in long-term capital gains tax (LTCG) on listed equities and government bonds, and a cut in the withholding tax on interest income earned by foreign investors on government securities. Both tax reliefs may be subject to specified time limits.
India and Korea have agreed to address New Delhi’s concerns over the widening bilateral trade deficit within the framework of the existing Comprehensive Economic Partnership Agreement (CEPA), instead of negotiating a fresh trade pact. “Both sides acknowledged India’s bilateral trade deficit, which has risen significantly since the India-Korea CEPA came into force in 2010, and agreed to address the issue within the overall India-Korea CEPA framework,” the commerce ministry said in a statement.
India’s economy continues to show resilience despite growing global uncertainty triggered by the conflict in West Asia, but rising crude oil prices, inflationary pressures and the risk of a weak monsoon could weigh on growth in the coming months, according to the Department of Economic Affairs’ (DEA) Monthly Economic Review for May released Saturday. The finance ministry’s economic assessment said domestic fundamentals remain supportive even as the external environment has turned more challenging. Manufacturing and services activity stayed in expansion mode, labour market conditions remained stable and foreign exchange reserves continued to provide a buffer against global shocks.
India's services trade saw an expansion in imports and exports during April, according to the Reserve Bank of India (RBI). The data showed that exports grew by 12.7 per cent to USD 37.021 billion in April, registering the highest growth in the calendar year.
India has emerged as the world's fifth mos digitalised economy, overtaking several advanced nations as rapid adoption of artificial intelligence, digital public infrastructure and online services reshape the global technology landscape, according to a report released on Friday. The State of India's Digital Economy (SIDE) 2026 repor by the ICRIER-Prosus Centre for Internet and Digital Economy (IPCIDE) ranked India fifth globally on the CHIPS-Combined Index, behind the US, China, Singapore and the UK. India ranked eighth in 2025.
