India is facing a fresh food inflation warning as rising edible oil prices, global supply disruptions and weather risks threaten to put additional pressure on household budgets. Inflation is now expected to average around 5.1%, more than double last year's 2% level, with risks tilted to the upside.

Edible oil has emerged as a major pressure point, with packed sunflower oil prices rising around 18%, palm oil around 14%, soybean oil nearly 12%, groundnut oil over 9% and mustard oil more than 7%.

India imports more than half of the edible oil it consumes, making domestic prices highly sensitive to developments in global markets. The Russia-Ukraine war and disruptions in the Black Sea are adding further uncertainty, as Russia and Ukraine remain major suppliers of sunflower products and other agricultural commodities.

At the same time, El Niño-related weather risks could affect India's monsoon and reduce yields of oilseeds such as soybean, groundnut and mustard. While India's food-grain inventories remain relatively strong and rainfall has improved, rising energy and transport costs, global commodity pressures and weather uncertainty could keep food inflation elevated.

India Food Inflation Warning: Edible Oil Prices Surge, Black Sea War And El Niño Raise Household Cost Risks

India’s inflation outlook is facing fresh pressure as edible oil prices rise sharply, global supply risks grow and weather conditions threaten agricultural production.

Prices of packed sunflower oil have reportedly risen around 18%, while palm oil, soybean oil, groundnut oil and mustard oil have also recorded significant increases. The impact is particularly important for India because the country imports more than half of the edible oil it consumes.

The Russia-Ukraine war and disruptions in the Black Sea are adding another layer of uncertainty. Russia and Ukraine are major suppliers of sunflower oil and other agricultural commodities, while the Black Sea remains a crucial export corridor for wheat, corn, sunflower products and vegetable oils.

At the same time, concerns over El Niño and uneven monsoon rainfall could affect India's oilseed crops, including soybean, groundnut and mustard. Lower domestic production could increase India's dependence on imports and put additional pressure on food prices.

However, India's strong food-grain inventories and improved rainfall provide some cushion.

India Inflation Warning | Edible Oil Prices Surge As Black Sea War & El Niño Threaten Food Costs

India could unlock a massive $110 billion export opportunity in food processing, according to a paper by the National Council of Applied Economic Research (NCAER).

India is already a major agricultural producer, with huge output of fruits, vegetables, grains, dairy and other farm products. However, much of this produce is exported or sold in relatively raw form, limiting the value India can capture.

Greater investment in food processing, cold storage, logistics, supply chains and technology could allow Indian agricultural products to be converted into packaged, ready-to-eat and longer-lasting products that command higher prices in international markets.

The opportunity also comes with major challenges. Fragmented production, inconsistent quality, inadequate storage infrastructure and limited scale can make it difficult for Indian producers to meet international standards and large export orders.

Government initiatives aimed at strengthening food processing infrastructure and attracting investment could help India move further up the global value chain.

India’s $110B Food Export Opportunity | Food Processing Could Turn India Into a Global Food Hub

#Gravitas A new report says India's 3.4-trillion-dollar household gold treasure could become a powerful engine of economic growth, and Generation Z may be the generation that unlocks it. 

How Gen Z Could Turn India into an Economic Superpower with $3.4 Trillion Gold Treasure | GRATIVAS 

Tamil Nadu has signed four new Memorandums of Understanding (MoUs) with leading global companies and an international university, reinforcing its position as one of India's top destinations for foreign investment, advanced manufacturing, technology, and higher education.

The agreements were signed in the presence of Chief Minister Vijay at the Guidance Tamil Nadu office in Chennai and are expected to generate nearly 3,000 direct and indirect jobs.

Among the major announcements:

A Swiss company will establish its first Global Capability Centre (GCC) in Tamil Nadu.
Germany's Nordex will open a new Research & Development Centre in Chennai.
South Korean auto component manufacturer Motivelink will invest in a new manufacturing facility, supporting supply chains for Hyundai and Kia.
The University of Western Australia will establish its first international campus in Tamil Nadu, further strengthening the state's higher education ecosystem.

Tamil Nadu Signs Four Global MoUs, Attracts Major Investments and Nearly 3,000 Jobs

Karnataka has emerged as the biggest beneficiary of the Government of India's Electronics Development Fund (EDF), reinforcing Bengaluru's position as the country's leading technology and innovation hub. According to official government data, Karnataka accounted for 90 of the 128 companies supported under the fund, attracting nearly 64% of the total investments. The Electronics Development Fund was launched to strengthen India's domestic capabilities in electronics, semiconductor design, embedded systems, and advanced technologies. The initiative supports startups and early-stage companies working on cutting-edge innovations that are critical to India's long-term technological ambitions.

Karnataka Leads India's Electronics Boom with Biggest Share of Government Tech Fund

The United States has imposed a new 10% tariff on imports from India under Section 301 of the Trade Act of 1974, citing concerns over the enforcement of laws against goods produced using forced labor. The tariff is part of a broader trade action targeting multiple economies. While India was initially expected to face a 12.5% tariff, the rate was reduced after New Delhi amended its foreign trade policy to prohibit imports made using forced labor. The US Department of Labor highlighted concerns across several Indian sectors, including textiles, garments, tea, shrimp processing, leather goods, carpets, fireworks, rice mills, and stone quarries. Industry experts warn that the permanent nature of the Section 301 tariffs could affect Indian exports, investments, and ongoing India-US trade negotiations.

US Imposes 10% Tariff on India | Trump Targets Forced Labor, Trade Talks Face New Challenge

Gold is no longer just a family heirloom in India—it is increasingly becoming a source of working capital. As households and small businesses turn to gold-backed loans for quick access to credit, the country's lending landscape is undergoing a quiet transformation. At the same time, China is accumulating gold reserves at a rapid pace, strengthening its strategic position amid global economic uncertainty. Why are Indians borrowing against gold while Beijing is buying more of it?

Gold loans surge: India's silent credit shift as China stockpiles gold

India's Chief Economic Advisor (CEA) V. Anantha Nageswaran has delivered a blunt warning to India's youth: the edge that software engineers and MBA graduates once enjoyed is no longer guaranteed. Speaking on an ANI podcast, Nageswaran said the era of white-collar dominance is fading and called on Indians to radically change how they view trade professions such as plumbing, carpentry, welding, and electrical work.&nbsp;“The globalising world gave a certain advantage for your software, computer science, or MBA education, but that era is over,” Nageswaran said.&nbsp;The CEA took direct aim at India's deep-rooted cultural bias against manual trades. “If you are a welder, a plumber, an electrician, and a carpenter etc. India doesn't consider it a diploma; we call it a diploma. We kind of made it unacceptable, unrespectable, and unfashionable. That needs to change,” he said.&nbsp;Nageswaran contrasted India's attitude with that of countries that have achieved sustained economic success. He pointed to Switzerland, Germany, Japan, South Korea, and China as nations that place high social respectability on trade skills, treating them as central to economic development rather than as secondary choices for those who could not secure a degree.&nbsp;His core argument was that trade skills carry a unique resilience against automation. “These are the areas where, in fact, the technological advance cannot take away your employability. So you should equip yourself with trade skills,” he said. “It's about trade skills. It's about soft skills which AI cannot easily replace, where human presence is required.”&nbsp;To illustrate his point, Nageswaran used the example of a chef. “You are actually sitting on a gold mine as a chef. You cannot be replaced by AI,” he said. “You have learned the skill that cannot be replicated by technology. So you are going to be a most respected professional in the years to come.”&nbsp;The remarks come at a time when India's job market is undergoing rapid disruption from artificial intelligence, with several entry-level white-collar roles in IT, finance, and back-office operations facing consolidation or elimination. Nageswaran's comments signal a shift in how India's top economic policymakers are thinking about employment, skills, and the future of work in an AI-driven economy.

India's Chief Economic Advisor V. Anantha Nageswaran says the era of MBA and software education advantage is over and urges youth to embrace trade skills AI cannot replace.

India's Chief Economic Advisor (CEA) V. Anantha Nageswaran has delivered a blunt warning to India's youth: the edge that software engineers and MBA graduates once enjoyed is no longer guaranteed. Speaking on an ANI podcast, Nageswaran said the era of white-collar dominance is fading and called on Indians to radically change how they view trade professions such as plumbing, carpentry, welding, and electrical work. “The globalising world gave a certain advantage for your software, computer science, or MBA education, but that era is over,” Nageswaran said. The CEA took direct aim at India's deep-rooted cultural bias against manual trades. “If you are a welder, a plumber, an electrician, and a carpenter etc. India doesn't consider it a diploma; we call it a diploma. We kind of made it unacceptable, unrespectable, and unfashionable. That needs to change,” he said. Nageswaran contrasted India's attitude with that of countries that have achieved sustained economic success. He pointed to Switzerland, Germany, Japan, South Korea, and China as nations that place high social respectability on trade skills, treating them as central to economic development rather than as secondary choices for those who could not secure a degree. His core argument was that trade skills carry a unique resilience against automation. “These are the areas where, in fact, the technological advance cannot take away your employability. So you should equip yourself with trade skills,” he said. “It's about trade skills. It's about soft skills which AI cannot easily replace, where human presence is required.” To illustrate his point, Nageswaran used the example of a chef. “You are actually sitting on a gold mine as a chef. You cannot be replaced by AI,” he said. “You have learned the skill that cannot be replicated by technology. So you are going to be a most respected professional in the years to come.” The remarks come at a time when India's job market is undergoing rapid disruption from artificial intelligence, with several entry-level white-collar roles in IT, finance, and back-office operations facing consolidation or elimination. Nageswaran's comments signal a shift in how India's top economic policymakers are thinking about employment, skills, and the future of work in an AI-driven economy.

India's Chief Economic Advisor V. Anantha Nageswaran said on an ANI podcast that the globalisation-driven advantage of software and MBA education is over and urged Indians to respect and embrace trade skills that artificial intelligence cannot replace.

'Respect plumber, carpenter': India's economic advisor says MBA and Software job era is over in AI world

India's economy is humming along at a steady and strong pace on paper. The International Monetary Fund and other leading financial institutions have touted the country's growth as the strongest among major economies for some time now.India's gross domestic product in 2025-26 came in at ₹345 lakh crore, or nearly $3.6 trillion, doubling from pre-pandemic levels. In rupee terms, the country's GDP is growing roughly 9 per cent per annum on average in recent years, suggesting a healthy rate.However, GDP growth rates are not measured in domestic terms on International platforms for comparative measures.They are broadly measured in dollars. But the rupee has been bleeding against the dollar in recent years, and quite significantly at that.Also read | <a href="https://www.wionews.com/india-news/rupee-slide-wars-and-more-indian-students-in-us-battle-currency-crisis-no-one-prepared-them-for-wion-horizons-1780044945428">Rupee slide, wars and more: Indian students in US battle currency crisis no one prepared them for | WION Horizons</a><h2>No stopping the bleeding</h2>In the seven years since the pre-pandemic period, 2018-19, India's GDP growth in dollar terms has been only about 5.7 per cent annually. That is where the country's dream of a $5 trillion economy has taken a hit.The pace of growth in dollar terms is less than half of what is needed to reach that target, even by 2029-30.The latest GDP of the country stands at nearly $3.6 trillion, with an exchange rate of 96 rupees per dollar. That exchange rate is near a fresh all-time low after a series of record-weak levels the currency has fallen in recent years, and the GDP is still over $1 trillion away from the dream $5 trillion target.<h2>Currency trap</h2>The rupee's bleeding against the dollar has only exacerbated in recent years, with the currency depreciating roughly 10 per cent in 2025-26 alone. That fall in a single year has neutralised the entire year's nominal GDP gains, more or less wiping out any progress towards the country's target.Also read | <a href="https://www.wionews.com/india-news/made-in-india-first-indigenous-airbus-c-295-completes-maiden-test-flight-watch-1781147116995">‘Made in India’: First indigenous Airbus C-295 completes maiden test flight | WATCH</a>Clearly, growth in local currency terms means nothing in a global context.The IMF projects India will likely hit the $5 trillion mark only in FY29, a full year later than the previously revised forecast, which was already pushed by a year. The caveat is that there is no further rupee shock.The Indian government had declared the $5 trillion goal in July 2019, aiming to climb the global GDP rankings rapidly.However, India's dollar GDP growth has covered only about 50 per cent of the required distance since then.While India had briefly overtaken Japan to become the fourth-largest economy in the world, it has now fallen back to the sixth position behind the United Kingdom.&nbsp;So, the rupee saga is more than just a currency crisis for the country.The lesson from the trend is clear - A country can grow in local currency and still shrink in global standing. Rupee depreciation isn't just a forex footnote anymore; it's fast becoming a strategic liability.India isn't just losing the growth race; it's losing the currency war, and in dollar terms, that's the only scoreboard on a global stage that counts.

India's economy has doubled since before the pandemic, but a weakening rupee is slowing growth in dollar terms. Here's why the $5 trillion economy target remains difficult to achieve.

India's economy is humming along at a steady and strong pace on paper. The International Monetary Fund and other leading financial institutions have touted the country's growth as the strongest among major economies for some time now. India's gross domestic product in 2025-26 came in at ₹345 lakh crore, or nearly $3.6 trillion, doubling from pre-pandemic levels. In rupee terms, the country's GDP is growing roughly 9 per cent per annum on average in recent years, suggesting a healthy rate. However, GDP growth rates are not measured in domestic terms on International platforms for comparative measures. They are broadly measured in dollars. But the rupee has been bleeding against the dollar in recent years, and quite significantly at that. Also read | Rupee slide, wars and more: Indian students in US battle currency crisis no one prepared them for | WION Horizons No stopping the bleeding In the seven years since the pre-pandemic period, 2018-19, India's GDP growth in dollar terms has been only about 5.7 per cent annually. That is where the country's dream of a $5 trillion economy has taken a hit. The pace of growth in dollar terms is less than half of what is needed to reach that target, even by 2029-30. The latest GDP of the country stands at nearly $3.6 trillion, with an exchange rate of 96 rupees per dollar. That exchange rate is near a fresh all-time low after a series of record-weak levels the currency has fallen in recent years, and the GDP is still over $1 trillion away from the dream $5 trillion target. Currency trap The rupee's bleeding against the dollar has only exacerbated in recent years, with the currency depreciating roughly 10 per cent in 2025-26 alone. That fall in a single year has neutralised the entire year's nominal GDP gains, more or less wiping out any progress towards the country's target. Also read | ‘Made in India’: First indigenous Airbus C-295 completes maiden test flight | WATCH Clearly, growth in local currency terms means nothing in a global context. The IMF projects India will likely hit the $5 trillion mark only in FY29, a full year later than the previously revised forecast, which was already pushed by a year. The caveat is that there is no further rupee shock. The Indian government had declared the $5 trillion goal in July 2019, aiming to climb the global GDP rankings rapidly. However, India's dollar GDP growth has covered only about 50 per cent of the required distance since then. While India had briefly overtaken Japan to become the fourth-largest economy in the world, it has now fallen back to the sixth position behind the United Kingdom. So, the rupee saga is more than just a currency crisis for the country. The lesson from the trend is clear - A country can grow in local currency and still shrink in global standing. Rupee depreciation isn't just a forex footnote anymore; it's fast becoming a strategic liability. India isn't just losing the growth race; it's losing the currency war, and in dollar terms, that's the only scoreboard on a global stage that counts.

India's economy has doubled since before the pandemic, but a weakening rupee is slowing growth in dollar terms. Here's why the $5 trillion economy target remains difficult to achieve.

The rupee trap for a $5 trillion economy?

Union Commerce and Industry Minister Piyush Goyal on Thursday expressed confidence that India will remain the world's fastest-growing economy over the next 20 years, citing the country's resilience in turning challenges into opportunities and its growing appeal for long-term global investments. Speaking at the Citi India Conference 2026, Goyal stated that India has continuously emerged stronger during times of global uncertainty and stands out as a preferred destination for trade, manufacturing, business and investments. "India will continue to be the world's fastest-growing economy for over two decades into the future," Goyal said. He emphasised that India has repeatedly adjusted its policies and business approaches in response to evolving global conditions, leveraging crises as catalysts for growth and development. The minister added that his recent engagements with global investors further strengthened optimism about India’s long-term economic outlook and growth trajectory. "Every conversation that I had reinforced one truth. The world's long-term capital is looking at India and the opportunities that India presents," he said.<h3>Hyundai's growth in India</h3>Goyal said the question for investors is no longer whether they should invest in India, but how soon they recognise and tap into the country's growth story. He also cited the example of South Korean automobile manufacturer Hyundai to illustrate India's growth potential. He highlighted that the company entered India in 1999 when infrastructure conditions were under development and invested USD 200 million. According to Goyal, Hyundai began manufacturing vehicles a few years later and has continued to expand its operations. He said that over the last 10 years alone, Hyundai has created a value of more than USD 12-13 billion through the residual value of its stake, while also receiving royalties, dividends, and capital aggregating another USD 12-13 billion. Goyal also referred to British construction equipment manufacturer JCB, which entered India when infrastructure development was still at an early stage. He said JCB now manufactures products in India and exports them to nearly 130 countries while also serving the growing domestic market. "Hyundai and JCB bet on substance over noise," Goyal said, adding that their success reflects India's manufacturing capabilities and long-term growth potential. The minister said India today is not only serving its domestic market of 1.4 billion people but is increasingly becoming a manufacturing base for global markets.

Piyush Goyal said that India has repeatedly adjusted its policies and business approaches in response to evolving global conditions, leveraging crises as catalysts for growth and development.

Union Commerce and Industry Minister Piyush Goyal on Thursday expressed confidence that India will remain the world's fastest-growing economy over the next 20 years, citing the country's resilience in turning challenges into opportunities and its growing appeal for long-term global investments. Speaking at the Citi India Conference 2026, Goyal stated that India has continuously emerged stronger during times of global uncertainty and stands out as a preferred destination for trade, manufacturing, business and investments. "India will continue to be the world's fastest-growing economy for over two decades into the future," Goyal said. He emphasised that India has repeatedly adjusted its policies and business approaches in response to evolving global conditions, leveraging crises as catalysts for growth and development. The minister added that his recent engagements with global investors further strengthened optimism about India’s long-term economic outlook and growth trajectory. "Every conversation that I had reinforced one truth. The world's long-term capital is looking at India and the opportunities that India presents," he said. Hyundai's growth in India Goyal said the question for investors is no longer whether they should invest in India, but how soon they recognise and tap into the country's growth story. He also cited the example of South Korean automobile manufacturer Hyundai to illustrate India's growth potential. He highlighted that the company entered India in 1999 when infrastructure conditions were under development and invested USD 200 million. According to Goyal, Hyundai began manufacturing vehicles a few years later and has continued to expand its operations. He said that over the last 10 years alone, Hyundai has created a value of more than USD 12-13 billion through the residual value of its stake, while also receiving royalties, dividends, and capital aggregating another USD 12-13 billion. Goyal also referred to British construction equipment manufacturer JCB, which entered India when infrastructure development was still at an early stage. He said JCB now manufactures products in India and exports them to nearly 130 countries while also serving the growing domestic market. "Hyundai and JCB bet on substance over noise," Goyal said, adding that their success reflects India's manufacturing capabilities and long-term growth potential. The minister said India today is not only serving its domestic market of 1.4 billion people but is increasingly becoming a manufacturing base for global markets.

Piyush Goyal said that India has repeatedly adjusted its policies and business approaches in response to evolving global conditions, leveraging crises as catalysts for growth and development.

India to remain world's fastest-growing economy for next 20 years: Piyush Goyal

The Reserve Bank of India (RBI) on Friday approved a record surplus transfer of 2.87 trillion rupees ($29.99 billion) to the federal government for the 2025-26 financial year, providing crucial fiscal support at a time when rising energy costs and subsidy burdens are straining New Delhi’s finances. The payout surpassed last year’s record transfer of 2.69 trillion rupees, but fell short of market expectations.&nbsp;&nbsp;Economists surveyed by Reuters had projected a dividend between 2.9 trillion and 3.2 trillion rupees, with many investors hoping for a larger transfer to cushion the impact of elevated crude oil prices linked to the Iran conflict. Shortly after the announcement, India’s benchmark 10-year bond yield rose three basis points to 7.1 per cent reflecting concerns that the government may still face pressure on its fiscal deficit.&nbsp;ALSO READ:<h2>Oil shock and subsidy burden weigh on finances</h2>India, the world’s third-largest importer and consumer of crude oil, has been grappling with the economic fallout from the Middle East conflict. New Delhi typically sources nearly half of its crude imports through the Strait of Hormuz, which has faced severe disruption since the outbreak of the Iran war earlier this year. The government has already reduced federal fuel taxes to shield consumers from rising prices, while fertiliser subsidy costs are also expected to increase amid higher global urea prices.&nbsp;&nbsp;“The RBI surplus transfer is marginally lower than expected, thereby limiting the levers for the government in terms of managing the fiscal slippage risks,” Upasna Bhardwaj, chief economist at Kotak Mahindra Bank, told Reuters. The government had budgeted for 3.16 trillion rupees in combined dividends from the RBI and state-owned financial institutions.&nbsp;ALSO READ:<h2>Strong RBI earnings boost payout</h2>The central bank said its board approved the surplus transfer after considering “current macroeconomic factors”, financial performance and the “maintenance of appropriate risk buffers”. The RBI’s balance sheet expanded 20.61 per cent to 91.97 trillion rupees as of March 31, 2026. Gross income rose 26.42 per cent, while expenditure increased 27.60 per cent. The RBI lowered its contingency risk buffer to 6.5 per cent of the balance sheet from 7.5 per cent a year earlier, while transferring 1.09 trillion rupees into the reserve buffer.&nbsp;The central bank earns income primarily from foreign securities holdings, including US Treasuries, and through foreign exchange operations. A weakening rupee during the year also contributed to stronger earnings from dollar sales in the open market. The RBI dividend will partially offset higher fertiliser subsidies,” Teresa John of Nirmal Bang Institutional Equities told AFP. “However, the risk of marginal fiscal slippage still remains.”

Economists surveyed by Reuters had projected a dividend between 2.9 trillion and 3.2 trillion rupees, with many investors hoping for a larger transfer to cushion the impact of elevated crude oil prices linked to the Iran conflict.

The Reserve Bank of India (RBI) on Friday approved a record surplus transfer of 2.87 trillion rupees ($29.99 billion) to the federal government for the 2025-26 financial year, providing crucial fiscal support at a time when rising energy costs and subsidy burdens are straining New Delhi’s finances. The payout surpassed last year’s record transfer of 2.69 trillion rupees, but fell short of market expectations. Economists surveyed by Reuters had projected a dividend between 2.9 trillion and 3.2 trillion rupees, with many investors hoping for a larger transfer to cushion the impact of elevated crude oil prices linked to the Iran conflict. Shortly after the announcement, India’s benchmark 10-year bond yield rose three basis points to 7.1 per cent reflecting concerns that the government may still face pressure on its fiscal deficit. ALSO READ: Oil shock and subsidy burden weigh on finances India, the world’s third-largest importer and consumer of crude oil, has been grappling with the economic fallout from the Middle East conflict. New Delhi typically sources nearly half of its crude imports through the Strait of Hormuz, which has faced severe disruption since the outbreak of the Iran war earlier this year. The government has already reduced federal fuel taxes to shield consumers from rising prices, while fertiliser subsidy costs are also expected to increase amid higher global urea prices. “The RBI surplus transfer is marginally lower than expected, thereby limiting the levers for the government in terms of managing the fiscal slippage risks,” Upasna Bhardwaj, chief economist at Kotak Mahindra Bank, told Reuters. The government had budgeted for 3.16 trillion rupees in combined dividends from the RBI and state-owned financial institutions. ALSO READ: Strong RBI earnings boost payout The central bank said its board approved the surplus transfer after considering “current macroeconomic factors”, financial performance and the “maintenance of appropriate risk buffers”. The RBI’s balance sheet expanded 20.61 per cent to 91.97 trillion rupees as of March 31, 2026. Gross income rose 26.42 per cent, while expenditure increased 27.60 per cent. The RBI lowered its contingency risk buffer to 6.5 per cent of the balance sheet from 7.5 per cent a year earlier, while transferring 1.09 trillion rupees into the reserve buffer. The central bank earns income primarily from foreign securities holdings, including US Treasuries, and through foreign exchange operations. A weakening rupee during the year also contributed to stronger earnings from dollar sales in the open market. The RBI dividend will partially offset higher fertiliser subsidies,” Teresa John of Nirmal Bang Institutional Equities told AFP. “However, the risk of marginal fiscal slippage still remains.”

Economists surveyed by Reuters had projected a dividend between 2.9 trillion and 3.2 trillion rupees, with many investors hoping for a larger transfer to cushion the impact of elevated crude oil prices linked to the Iran conflict.

RBI approves record Rs. 2.87 trillion dividend to government amid rising fiscal pressure

Budget 2026 places Artificial Intelligence at the center of India’s economic growth strategy. The government has highlighted AI as a “force multiplier” to boost productivity, innovation, job creation, and global competitiveness across sectors such as manufacturing, healthcare, education, and digital services.

Budget 2026: AI Touted as Force Multiplier for India’s Economy

With the 2026 budget approaching, India is intensifying efforts to reduce dependence on imported energy, electronics, and defense equipment. The government is reshaping supply chains as a key strategy and plans to allocate budget funds to support domestic manufacturing initiatives. This report decodes how India aims to strengthen its local industries and boost economic self-reliance.

India Budget 2026: Build On Domestic Manufacturing Plan 

India has officially overtaken Japan to become the world’s fourth-largest economy, with projections indicating that it will soon surpass Germany and claim the third spot by 2028. According to India’s year-end economic review, the country’s GDP has reached approximately $4.18 trillion, and is forecast to grow to $7.3 trillion by 2030, positioning it just behind China and the United States in economic size.&nbsp;On the international stage, China has offered its congratulations to India for this economic milestone. Yu Jing, spokesperson for the Chinese Embassy in India, praised India’s achievement, saying that India’s rise demonstrates the strength that comes from confronting its history honestly, learning from it, and taking responsibility for the future. In a tweet, she wrote, “Delighted to know that India🇮🇳 is poised to surpass Japan🇯🇵 to become the world's 4th largest economy. India's rise shows that true strength comes from facing history honestly, learning from it, and taking responsibility for the future.”&nbsp;Also Read: <a href="https://www.wionews.com/business-economy/disney-to-pay-10-million-to-settle-privacy-allegation-over-children-s-videos-on-youtube-1767174844315">Disney to pay $10 million to settle privacy allegation over children’s videos on YouTube</a>

<blockquote class="twitter-tweet">Delighted to know that India🇮🇳 is poised to surpass Japan🇯🇵 to become the world&#39;s 4th largest economy 📈 India&#39;s rise shows that true strength comes from facing history honestly, learning from it, and taking responsibility for the future. 📜➡🚀<a href="https://twitter.com/hashtag/India?src=hash&amp;ref_src=twsrc%5Etfw">#India</a> <a href="https://twitter.com/hashtag/GlobalEconomy?src=hash&amp;ref_src=twsrc%5Etfw">#GlobalEconomy</a>… <a href="https://t.co/RLRK1gt08P">pic.twitter.com/RLRK1gt08P</a>&mdash; Yu Jing (@ChinaSpox_India) <a href="https://twitter.com/ChinaSpox_India/status/2006276639534244076?ref_src=twsrc%5Etfw">December 31, 2025</a></blockquote> <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>

The country's growth has been strong, with an impressive 8.2% GDP growth in the second quarter of fiscal year 2025–26, marking the highest quarterly growth in six quarters. Additionally, India’s export sector is thriving, with merchandise exports reaching $38.13 billion in November 2025, driven by strong performances in sectors like engineering goods, electronics, pharmaceuticals, and petroleum products.&nbsp;This growth is largely fueled by robust domestic demand, particularly private consumption, despite global trade challenges and policy uncertainties. India’s government has described this period as a rare "Goldilocks" moment, with the economy experiencing high growth and low inflation. Corporate finances remain strong, credit is flowing steadily, and ongoing reforms continue to provide a solid foundation for long-term growth.&nbsp;However, India still faces challenges. Despite rapid growth, its GDP per capita remains relatively low compared to advanced economies. In 2024, India’s GDP per capita stood at $2,694, significantly lower than Japan’s and Germany’s. The nation’s large population, now surpassing 1.4 billion people, also poses a challenge in terms of creating sufficient, high-quality job opportunities for millions of young graduates. India’s economic ambitions are clear: by 2047, the centenary of its independence, the country aims to achieve high middle-income status, building on its strong demographic advantage and expanding economy.

India has surpassed Japan to become the world's 4th largest economy. With praise from China, India aims to overtake Germany by 2028, driven by strong domestic growth

India has officially overtaken Japan to become the world’s fourth-largest economy, with projections indicating that it will soon surpass Germany and claim the third spot by 2028. According to India’s year-end economic review, the country’s GDP has reached approximately $4.18 trillion, and is forecast to grow to $7.3 trillion by 2030, positioning it just behind China and the United States in economic size. On the international stage, China has offered its congratulations to India for this economic milestone. Yu Jing, spokesperson for the Chinese Embassy in India, praised India’s achievement, saying that India’s rise demonstrates the strength that comes from confronting its history honestly, learning from it, and taking responsibility for the future. In a tweet, she wrote, “Delighted to know that India🇮🇳 is poised to surpass Japan🇯🇵 to become the world's 4th largest economy. India's rise shows that true strength comes from facing history honestly, learning from it, and taking responsibility for the future.” Also Read: Disney to pay $10 million to settle privacy allegation over children’s videos on YouTube

India has surpassed Japan to become the world's 4th largest economy. With praise from China, India aims to overtake Germany by 2028, driven by strong domestic growth

China lauds India for surpassing Japan, becoming world's fourth largest economy

India’s retail inflation cooled sharply to 2.10 per cent in June, marking its lowest level in over six years and slipping close to the bottom end of the Reserve Bank of India’s target band. The dramatic slowdown has been driven largely by easing food prices, offering the central bank more headroom to support growth through monetary easing. According to Reuters, June’s inflation prints surprised markets, coming in lower than the 2.5 per cent median estimate in a Reuters poll. It also marked a steep decline from 2.82 per cent in May.<h2>Food prices lead the disinflation trend</h2>Food prices, which make up nearly half of India’s consumer price index basket, saw a year-on-year decline of 1.06 per cent in June. This compared with a 0.99 per cent rise in May, signalling broad-based relief for consumers. Vegetable prices plunged 19 per cent year-on-year in June, extending May’s 13.7 per cent fall.&nbsp;Sakshi Gupta, economist at HDFC Bank, told Reuters that, “CPI inflation edged further down in June on the back of lower food prices". The government’s statistical office confirmed that both headline and food inflation in June were the lowest since January 2019.<h2>Easing inflation gives RBI room to focus on growth</h2>The latest inflation data underscores the impact of favourable monsoon rains, which have boosted crop production and moderated food prices. The Reserve Bank of India (RBI) is mandated to keep inflation within a 2–6 per cent band for three consecutive quarters. With inflation now hovering at the bottom end of that range, economists say the central bank has room to continue cutting rates if needed. In June, the RBI surprised markets by cutting its repo rate by 50 basis points, a larger-than-expected move that signalled a shift toward supporting economic growth.&nbsp;The central bank also lowered its fiscal 2026 retail inflation forecast to 3.7 per cent from 4 per cent, citing the early arrival of monsoon rains and strong harvest expectations. Sanjay Malhotra, RBI governor, told a national daily that if inflation undershoots the central bank’s projections, it could create further space for policy easing.<h2>Economists see scope for more cuts, but caution remains</h2>While the latest inflation data has boosted hopes for further monetary easing, some economists caution that the RBI will likely take a measured approach.&nbsp;Upasna Bhardwaj, economist at Kotak Mahindra Bank, told Reuters that, “While comfortable inflation opens room for further monetary easing, we expect the RBI to maintain a pause in the coming one-two meetings and remain watchful of the transmission ahead along with global uncertainties.”&nbsp;Core inflation, an important gauge of underlying demand that excludes volatile food and energy prices was estimated at 4.4–4.5 per cent in June, up from 4.17–4.20 per cent in May, according to economists quoted by Reuters. India’s official statistics agency does not publish core inflation figures, but analysts track them closely to assess the persistence of price pressures beyond food and fuel.The bottom line&nbsp;June’s inflation reading offers a rare piece of good news for India’s policymakers, signalling that the central bank has regained room to manoeuvre after a year of battling price pressures.But with core inflation still elevated and global risks looming, the RBI is expected to tread carefully, balancing the need to support growth with its commitment to price stability.&nbsp;

However, with core inflation still hovering above 4.4% and global uncertainties in play, economists expect the RBI to proceed with caution, maintaining a data driven approach in future policy decisions.

India’s retail inflation cooled sharply to 2.10 per cent in June, marking its lowest level in over six years and slipping close to the bottom end of the Reserve Bank of India’s target band. The dramatic slowdown has been driven largely by easing food prices, offering the central bank more headroom to support growth through monetary easing. According to Reuters, June’s inflation prints surprised markets, coming in lower than the 2.5 per cent median estimate in a Reuters poll. It also marked a steep decline from 2.82 per cent in May. Food prices lead the disinflation trend Food prices, which make up nearly half of India’s consumer price index basket, saw a year-on-year decline of 1.06 per cent in June. This compared with a 0.99 per cent rise in May, signalling broad-based relief for consumers. Vegetable prices plunged 19 per cent year-on-year in June, extending May’s 13.7 per cent fall. Sakshi Gupta, economist at HDFC Bank, told Reuters that, “CPI inflation edged further down in June on the back of lower food prices". The government’s statistical office confirmed that both headline and food inflation in June were the lowest since January 2019. Easing inflation gives RBI room to focus on growth The latest inflation data underscores the impact of favourable monsoon rains, which have boosted crop production and moderated food prices. The Reserve Bank of India (RBI) is mandated to keep inflation within a 2–6 per cent band for three consecutive quarters. With inflation now hovering at the bottom end of that range, economists say the central bank has room to continue cutting rates if needed. In June, the RBI surprised markets by cutting its repo rate by 50 basis points, a larger-than-expected move that signalled a shift toward supporting economic growth. The central bank also lowered its fiscal 2026 retail inflation forecast to 3.7 per cent from 4 per cent, citing the early arrival of monsoon rains and strong harvest expectations. Sanjay Malhotra, RBI governor, told a national daily that if inflation undershoots the central bank’s projections, it could create further space for policy easing. Economists see scope for more cuts, but caution remains While the latest inflation data has boosted hopes for further monetary easing, some economists caution that the RBI will likely take a measured approach. Upasna Bhardwaj, economist at Kotak Mahindra Bank, told Reuters that, “While comfortable inflation opens room for further monetary easing, we expect the RBI to maintain a pause in the coming one-two meetings and remain watchful of the transmission ahead along with global uncertainties.” Core inflation, an important gauge of underlying demand that excludes volatile food and energy prices was estimated at 4.4–4.5 per cent in June, up from 4.17–4.20 per cent in May, according to economists quoted by Reuters. India’s official statistics agency does not publish core inflation figures, but analysts track them closely to assess the persistence of price pressures beyond food and fuel. The bottom line June’s inflation reading offers a rare piece of good news for India’s policymakers, signalling that the central bank has regained room to manoeuvre after a year of battling price pressures. But with core inflation still elevated and global risks looming, the RBI is expected to tread carefully, balancing the need to support growth with its commitment to price stability.

India’s inflation dropped to a six-year low of 2.10% in June, led by falling food prices. The RBI now has room for further easing, but core inflation and global risks could limit bold moves.

India’s retail inflation hits six-year low at 2.1% on falling food prices

As we track global trends in tax policies, Indian consumers may be headed for a major cut in indirect taxes. Finance Minister Nirmala Sitharaman has hinted at a major rehaul to the country's goods and services taxes and has even suggested that we may be headed for tax rate cuts.The proposed changes could ease prices for households while giving a boost to business sentiment.<h2>Items under the 12% tax slab rate</h2>Just last week, reports suggested that the GST council was looking to do away with the 12 per cent tax slab to make compliance easier. &nbsp;

Graphics showcasing items under the 12% Tax Slab Rate

The proposal added that essentials under the 12 per cent tax slab would be moved into a lower tax slab. However, much will depend on how these reforms are structured and whether they strike the right balance between simplicity and revenue needs. Lower GST rates could translate to reduced costs on goods and services, offering some relief from persistent inflation. A streamlined structure might also help make pricing more transparent.From an economic standpoint, simplifying the tax regime could improve compliance and reduce operational friction for businesses. Still, concerns remain around how this will affect states’ revenues, which are partly dependent on GST collections. Small businesses, while potentially benefiting from reduced complexity, May still face challenges adapting to new structures and reporting requirements.Internationally, India’s push mirrors a broader trend of tax reform aimed at economic competitiveness. The restructuring also seeks to address long-standing inefficiencies, but implementation will be key. As the country awaits the next GST council meeting, optimism is tempered by the need for careful design and broad-based consensus to ensure the reforms are both sustainable and equitable.&nbsp;

With plans to scrap the 12% GST slab, India eyes lower indirect taxes on key items—promising relief for consumers, streamlined compliance for businesses, and a more transparent, efficient tax structure.

As we track global trends in tax policies, Indian consumers may be headed for a major cut in indirect taxes. Finance Minister Nirmala Sitharaman has hinted at a major rehaul to the country's goods and services taxes and has even suggested that we may be headed for tax rate cuts. The proposed changes could ease prices for households while giving a boost to business sentiment. Items under the 12% tax slab rate Just last week, reports suggested that the GST council was looking to do away with the 12 per cent tax slab to make compliance easier.

India’s proposed GST reforms may eliminate the 12% slab, potentially making essential goods and services cheaper while aiming to simplify tax compliance.

India GST reforms: What will likely become cheaper?

India has renewed calls to reform global trade rules, urging the World Trade Organization (WTO) to address non-tariff barriers (NTBs), discipline non-market economies, and restore its paralysed dispute resolution system.&nbsp;The appeal came as Commerce and Industry Minister Piyush Goyal represented India at an informal WTO mini-ministerial in Paris this week, hosted by Australia on the sidelines of the OECD Ministerial Council Meeting. It comes amid escalating trade tensions with the United States over its recent 26 per cent tariff on Indian goods.<h2>India’s message at the WTO</h2>As quoted by PTI, Goyal told the gathering that the WTO must act against distortions caused by non-market economies and eliminate NTBs that restrict access for developing nations. He also reiterated India’s call to revive the WTO’s appellate body, which has remained non-functional since 2009 due to the US blocking appointments.&nbsp;He emphasised the importance of retaining special and differential treatment for developing countries and said the organisation must uphold commitments made in previous ministerial conferences.&nbsp;The meeting, held behind closed doors, was attended by ministers from around 25 WTO member nations, including Australia, Singapore, Nigeria and France, as well as WTO Director-General Ngozi Okonjo-Iweala.<h2>India responds to US tariffs</h2>India’s remarks come against the backdrop of recent tariff action by Washington. In April 2025, the US imposed a 26 per cent tariff on a wide range of Indian exports, citing national security and alleged unfair trade practices — a move that drew criticism from New Delhi.&nbsp;According to ANI, India responded by lodging a formal protest with the Office of the United States Trade Representative and initiating consultations under WTO provisions. Officials also warned of reciprocal measures if the duties were not withdrawn.&nbsp;On 9 May, India submitted a note to the WTO characterising the US tariffs as “safeguard measures” and stated that they affect Indian exports worth $7.6 billion, with around $1.91 billion collected in duties. India proposed equivalent retaliatory tariffs, although it did not specify the products concerned.&nbsp;As per Reuters, the United States dismissed India’s claims in its response on 23 May, stating that the Section 232 tariffs were imposed on national security grounds and arguing that India did not follow the procedural requirements for such a challenge.<h2>India–US trade talks continue despite tensions</h2>Despite friction, both sides remain engaged in trade talks. As reported by PTI, Goyal said India and the US are committed to resolving differences and are working towards a comprehensive bilateral trade agreement.&nbsp;The deal aims to settle long-standing tariff disputes, improve market access for Indian pharmaceuticals, textiles and services, and increase bilateral trade. The US is India’s largest trading partner, while India is the US’s tenth-largest.&nbsp;US Commerce Secretary Howard Lutnick expressed optimism during the US-India Strategic Partnership Forum’s summit on 2 June. As quoted by ANI, he said that negotiators have “found a place that really works for both countries” and added that a deal could come “in the not-too-distant future”.&nbsp;He noted that India could gain by concluding an early agreement. “Earlier countries get a better deal — that’s the way it is,” he said, referencing the 90-day reciprocal tariff pause that is set to expire in July.<h2>OECD cuts global growth forecast, warns of tariff risks</h2>The Organisation for Economic Co-operation and Development (OECD), in its latest Economic Outlook released on 3 June, downgraded its global growth forecast due to heightened trade tensions.&nbsp;According to Reuters, the OECD now projects the global economy will expand by just 2.9 per cent in both 2025 and 2026, compared to its previous forecast of 3.1 per cent and 3.0 per cent, respectively. It warned that increased protectionism could fuel inflation and depress investment.&nbsp;The report offered a relatively optimistic forecast for India. It projected that the Indian economy will grow by 6.3 per cent in FY2026 and 6.4 per cent in FY2027. The OECD said benign inflation, tax cuts, a stronger labour market and increased public investment are expected to support consumption and capital formation. However, it cautioned that US tariffs would likely impact Indian export competitiveness.

It comes amid escalating trade tensions with the United States over its recent 26 per cent tariff on Indian goods.

India has renewed calls to reform global trade rules, urging the World Trade Organization (WTO) to address non-tariff barriers (NTBs), discipline non-market economies, and restore its paralysed dispute resolution system. The appeal came as Commerce and Industry Minister Piyush Goyal represented India at an informal WTO mini-ministerial in Paris this week, hosted by Australia on the sidelines of the OECD Ministerial Council Meeting. It comes amid escalating trade tensions with the United States over its recent 26 per cent tariff on Indian goods. India’s message at the WTO As quoted by PTI, Goyal told the gathering that the WTO must act against distortions caused by non-market economies and eliminate NTBs that restrict access for developing nations. He also reiterated India’s call to revive the WTO’s appellate body, which has remained non-functional since 2009 due to the US blocking appointments. He emphasised the importance of retaining special and differential treatment for developing countries and said the organisation must uphold commitments made in previous ministerial conferences. The meeting, held behind closed doors, was attended by ministers from around 25 WTO member nations, including Australia, Singapore, Nigeria and France, as well as WTO Director-General Ngozi Okonjo-Iweala. India responds to US tariffs India’s remarks come against the backdrop of recent tariff action by Washington. In April 2025, the US imposed a 26 per cent tariff on a wide range of Indian exports, citing national security and alleged unfair trade practices — a move that drew criticism from New Delhi. According to ANI, India responded by lodging a formal protest with the Office of the United States Trade Representative and initiating consultations under WTO provisions. Officials also warned of reciprocal measures if the duties were not withdrawn. On 9 May, India submitted a note to the WTO characterising the US tariffs as “safeguard measures” and stated that they affect Indian exports worth $7.6 billion, with around $1.91 billion collected in duties. India proposed equivalent retaliatory tariffs, although it did not specify the products concerned. As per Reuters, the United States dismissed India’s claims in its response on 23 May, stating that the Section 232 tariffs were imposed on national security grounds and arguing that India did not follow the procedural requirements for such a challenge. India–US trade talks continue despite tensions Despite friction, both sides remain engaged in trade talks. As reported by PTI, Goyal said India and the US are committed to resolving differences and are working towards a comprehensive bilateral trade agreement. The deal aims to settle long-standing tariff disputes, improve market access for Indian pharmaceuticals, textiles and services, and increase bilateral trade. The US is India’s largest trading partner, while India is the US’s tenth-largest. US Commerce Secretary Howard Lutnick expressed optimism during the US-India Strategic Partnership Forum’s summit on 2 June. As quoted by ANI, he said that negotiators have “found a place that really works for both countries” and added that a deal could come “in the not-too-distant future”. He noted that India could gain by concluding an early agreement. “Earlier countries get a better deal — that’s the way it is,” he said, referencing the 90-day reciprocal tariff pause that is set to expire in July. OECD cuts global growth forecast, warns of tariff risks The Organisation for Economic Co-operation and Development (OECD), in its latest Economic Outlook released on 3 June, downgraded its global growth forecast due to heightened trade tensions. According to Reuters, the OECD now projects the global economy will expand by just 2.9 per cent in both 2025 and 2026, compared to its previous forecast of 3.1 per cent and 3.0 per cent, respectively. It warned that increased protectionism could fuel inflation and depress investment. The report offered a relatively optimistic forecast for India. It projected that the Indian economy will grow by 6.3 per cent in FY2026 and 6.4 per cent in FY2027. The OECD said benign inflation, tax cuts, a stronger labour market and increased public investment are expected to support consumption and capital formation. However, it cautioned that US tariffs would likely impact Indian export competitiveness.

India urged WTO reform, focusing on addressing non-tariff barriers, regulating non-market economies, and restoring the dispute resolution system, emphasized by Minister Piyush Goyal at a mini-ministerial in Paris.

India urges WTO to act on trade barriers amid tariff dispute with the US

India's economic growth for the fiscal year 2024-25 (FY25) has significantly slowed, with GDP expanding by only 6.5 per cent, the weakest pace in four years.&nbsp;&nbsp;This decline from the previous year’s 9.2 per cent reflects a combination of domestic challenges, including fiscal stress, slower consumer spending, and external economic pressures. The government has faced difficulties in meeting its fiscal targets, and quarterly growth numbers indicate a downward trajectory almost throughout the fiscal year.&nbsp;&nbsp;The economy grew at 7.4 per cent in the fourth quarter (Q4) of FY25.<h2>Weakening growth and fiscal deficit pressures</h2>India's growth slowdown was more pronounced in the first three quarters of FY25, with the economy expanding at 6.7 per cent in Q1 FY25, 5.4 per cent in Q2, and 6.2 per cent in Q3. The Q4 growth of 7.4 per cent helped somewhat, but the overall annual growth was still significantly below expectations.&nbsp;Several sectors, including manufacturing, construction, and agriculture, faced headwinds, contributing to the deceleration.&nbsp;Meanwhile, the Indian government is grappling with an increasing fiscal deficit, which reached alarming levels in FY25. Despite fiscal consolidation efforts, India's fiscal deficit for FY25 stood at&nbsp;₹15.77 lakh crore ($184.29 billion), slightly higher than the ₹15.70 lakh crore ($183.47 billion) estimated for the year, according to the provisional data released by the Controller General of Accounts (CGA) on May 30.This widening deficit is primarily driven by higher-than-expected government expenditure, especially on welfare schemes, infrastructure development, and energy subsidies.&nbsp;&nbsp;The Reserve Bank of India (RBI) has been forced to intervene, transferring a larger-than-expected dividend to the government to ease some of the fiscal pressures. This has provided some short-term relief, but the overall fiscal situation remains precarious.&nbsp;<h2>Risks and future projections</h2>The outlook for India’s economy in FY26 remains uncertain, with risks to growth continuing to mount. A key concern is the ongoing global economic volatility, which has affected trade and investment flows into India.&nbsp;&nbsp;With slower growth in major economies like the US, Europe, and China, the Indian economy faces challenges in sustaining high growth in exports and attracting foreign investments into the country.Additionally, geopolitical tensions and the continued impact of conflicts across the globe have further added to global instability, making it more difficult for emerging economies like India to maintain robust growth.&nbsp;Inflation has remained persistently high throughout FY25. Although the RBI has cut interest rates in an attempt to curb inflationary pressures, the cost of food and fuel has continued to rise, limiting the purchasing power of the consumers and dampening overall demand.&nbsp;&nbsp;The government has been working to contain inflation by implementing various supply-side measures, but the persistent price pressures and strain on global supply chains are expected to remain a challenge in the near future.&nbsp;Looking ahead, India's growth prospects will largely depend on the government's ability to balance fiscal responsibility with necessary spending on infrastructure, social welfare, and job creation. The country will also need to focus on addressing structural issues such as labour market inefficiencies and bottlenecks in key sectors to drive future growth.&nbsp;&nbsp;While the long-term potential of the Indian economy remains strong, immediate challenges require careful management of fiscal policy, inflation, and external factors that may hinder recovery. &nbsp;

Business & Economy: The government has struggled to meet its fiscal targets, with quarterly growth numbers showing a downward trajectory. 

India's economic growth for the fiscal year 2024-25 (FY25) has significantly slowed, with GDP expanding by only 6.5 per cent, the weakest pace in four years. This decline from the previous year’s 9.2 per cent reflects a combination of domestic challenges, including fiscal stress, slower consumer spending, and external economic pressures. The government has faced difficulties in meeting its fiscal targets, and quarterly growth numbers indicate a downward trajectory almost throughout the fiscal year. The economy grew at 7.4 per cent in the fourth quarter (Q4) of FY25. Weakening growth and fiscal deficit pressures India's growth slowdown was more pronounced in the first three quarters of FY25, with the economy expanding at 6.7 per cent in Q1 FY25, 5.4 per cent in Q2, and 6.2 per cent in Q3. The Q4 growth of 7.4 per cent helped somewhat, but the overall annual growth was still significantly below expectations. Several sectors, including manufacturing, construction, and agriculture, faced headwinds, contributing to the deceleration. Meanwhile, the Indian government is grappling with an increasing fiscal deficit, which reached alarming levels in FY25. Despite fiscal consolidation efforts, India's fiscal deficit for FY25 stood at ₹15.77 lakh crore ($184.29 billion), slightly higher than the ₹15.70 lakh crore ($183.47 billion) estimated for the year, according to the provisional data released by the Controller General of Accounts (CGA) on May 30. This widening deficit is primarily driven by higher-than-expected government expenditure, especially on welfare schemes, infrastructure development, and energy subsidies. The Reserve Bank of India (RBI) has been forced to intervene, transferring a larger-than-expected dividend to the government to ease some of the fiscal pressures. This has provided some short-term relief, but the overall fiscal situation remains precarious. Risks and future projections The outlook for India’s economy in FY26 remains uncertain, with risks to growth continuing to mount. A key concern is the ongoing global economic volatility, which has affected trade and investment flows into India. With slower growth in major economies like the US, Europe, and China, the Indian economy faces challenges in sustaining high growth in exports and attracting foreign investments into the country. Additionally, geopolitical tensions and the continued impact of conflicts across the globe have further added to global instability, making it more difficult for emerging economies like India to maintain robust growth. Inflation has remained persistently high throughout FY25. Although the RBI has cut interest rates in an attempt to curb inflationary pressures, the cost of food and fuel has continued to rise, limiting the purchasing power of the consumers and dampening overall demand. The government has been working to contain inflation by implementing various supply-side measures, but the persistent price pressures and strain on global supply chains are expected to remain a challenge in the near future. Looking ahead, India's growth prospects will largely depend on the government's ability to balance fiscal responsibility with necessary spending on infrastructure, social welfare, and job creation. The country will also need to focus on addressing structural issues such as labour market inefficiencies and bottlenecks in key sectors to drive future growth. While the long-term potential of the Indian economy remains strong, immediate challenges require careful management of fiscal policy, inflation, and external factors that may hinder recovery.

India's economic growth for FY25 has slowed to 6.5%, the weakest pace in four years, due to domestic challenges such as fiscal stress, slower consumer spending, and external economic pressures.&nbsp;

India's GDP growth slows to 6.5% in FY25 amid fiscal and global headwinds

In a financial year marked by volatile global headwinds, the Reserve Bank of India (RBI) delivered a record ₹2.69 lakh crore ($32.28 billion) surplus to the government, by 27.3 per cent from the previous year’s ₹2.11 lakh crore ($25.32 billion).&nbsp;According to the RBI Annual Report for FY2024–25, this sharp jump in net income was driven by higher foreign exchange transaction gains, interest from foreign securities, and a cautious hike in its contingency risk buffer.&nbsp;While this windfall gives the Centre significant fiscal breathing space for its capital spending and welfare programs, the report also outlines a bold technology-forward vision for FY26 anchored around digital currency pilots, AI deployment, and cross-border innovation.<h2>Stronger balance sheet, bigger dividend</h2>As per the annual report, the central bank’s net income surged 27.3 per cent year-on-year to ₹2.69 lakh crore ($32.28 billion) in FY25, up from ₹2.11 lakh crore ($25.32 billion) the previous year. This includes gains of ₹11.1 lakh crore ($133.2 billion) from foreign exchange transactions, and ₹9.7 lakh crore ($116.4 billion) in interest income from foreign securities.&nbsp;The RBI’s balance sheet expanded 8.2 per cent to ₹76.25 lakh crore ($915 billion), with foreign assets accounting for over 74 per cent of the total. Notably, the central bank’s gold holdings rose by 57.5 metric tonnes to 879.6 metric tonnes as of March 2025.&nbsp;A significant portion of the income of ₹2.68 lakh crore ($32.16 billion) has already been transferred to the central government as surplus, a move expected to ease fiscal pressures, support capital spending, and inject liquidity into the banking system by early July, according to economists cited in the report.&nbsp;The report also highlights that the Contingency Risk Buffer (CRB), which helps cushion against economic shocks was maintained at 6.5 per cent, the same level as FY24.&nbsp;Inflation, growth, and monetary policy: RBI’s balancing actThe RBI’s latest report offers a cautiously optimistic view of the Indian economy. According to the central bank, headline inflation is likely to converge to the 4 per cent target over the next 12 months, thanks to a favourable mix of macroeconomic conditions.&nbsp;These include easing global supply chain pressures, softening of international commodity prices, and above-normal rainfall boosting agricultural output.&nbsp;At the same time, GDP growth for FY26 is projected at 6.5 per cent, with the momentum driven by private consumption, healthy corporate and banking balance sheets, and the government’s continued focus on capital expenditure.&nbsp;In response to moderating inflation and subdued economic momentum, the RBI has already cut the policy repo rate by 50 basis points since February, and adopted a ‘growth-supportive’ accommodative stance in April.&nbsp;However, the path forward is not without risks. The RBI flagged a range of external headwinds, rising protectionism, geopolitical conflicts, and volatile financial markets that could threaten both inflation and growth targets. Of particular concern is the return of US tariffs under President Donald Trump, which have added uncertainty to global trade flows and emerging market stability.&nbsp;According to the report, “While the outlook remains promising, downside risks to growth and upside risks to inflation persist due to evolving global dynamics.”<h2>Digital rupee, FX platform, and CBDC pilots: What’s next for RBI?</h2>The RBI is making it clear that India’s digital financial future is no longer experimental, it’s strategic.&nbsp;According to the report, the RBI will expand the pilots for central bank digital currency (CBDC) in both retail (e₹-Retail) and wholesale (e₹-Wholesale) segments. Building on groundwork laid over the past two years, the central bank now plans to test cross-border CBDC transactions, both bilateral and multilateral to make global payments faster, more transparent, and more secure.&nbsp;In addition, the RBI will link its FX-Retail platform with Bharat Connect, a move aimed at democratising access to forex markets for small businesses and individual users. This is particularly significant as India’s foreign exchange reserves peaked at $704 billion in September 2024, and the RBI was the top net seller of forex among Asian central banks in January 2025, according to estimates from Nomura and DBS Bank.&nbsp;The digital push doesn’t end there. The RBI will also roll out new CBDC use cases, such as B2B payments under the Unified Ledger Interface (ULI), and scale up Milehunter.ai™, its AI-driven analytics platform. To accompany this digital acceleration, the central bank will also develop a framework for the responsible and ethical use of AI in the financial sector.&nbsp;These pilots and platforms, the report notes, are designed to overcome persistent inefficiencies in the current system, especially those related to turnaround time, traceability, and cross-border transaction costs.<h2>Bank fraud amount triples despite drop in cases</h2>One of the more concerning takeaways from the report is the sharp rise in the value of bank frauds.&nbsp;While the total number of fraud cases declined by 34 per cent to 23,953 in FY25, the value of frauds tripled to ₹36,014 crore ($432.17 million), up from roughly ₹12,000 crore ($144 million) in FY24.&nbsp;According to the RBI annual report, this spike was largely due to the reclassification of 122 legacy fraud cases worth ₹18,674 crore ($224.08 million), after a March 2023 Supreme Court ruling mandated re-examination.&nbsp;Private sector banks reported the highest number of fraud incidents at 14,233 cases, accounting for 59.4 per cent of total frauds. But in terms of value, state-owned banks bore the brunt, accounting for ₹25,667 crore ($307.99 million) (71.3 per cent of total fraud value) compared to ₹10,088 crore ($121.05 million) by private lenders.&nbsp;Most of these frauds occurred in two areas:• Digital payments (cards/internet): 13,516 cases, ₹520 crore ($6.24 million)• Loan/advances segment: 7,950 cases, ₹33,148 crore ($398 million)&nbsp;The RBI noted that while digital frauds dominate in private banks, loan-related frauds remain concentrated in public sector banks, raising concerns about credit risk monitoring and recovery.&nbsp;

Business & Economy: One of the more concerning takeaways from the RBI report is the sharp rise in the value of bank frauds.

In a financial year marked by volatile global headwinds, the Reserve Bank of India (RBI) delivered a record ₹2.69 lakh crore ($32.28 billion) surplus to the government, by 27.3 per cent from the previous year’s ₹2.11 lakh crore ($25.32 billion). According to the RBI Annual Report for FY2024–25, this sharp jump in net income was driven by higher foreign exchange transaction gains, interest from foreign securities, and a cautious hike in its contingency risk buffer. While this windfall gives the Centre significant fiscal breathing space for its capital spending and welfare programs, the report also outlines a bold technology-forward vision for FY26 anchored around digital currency pilots, AI deployment, and cross-border innovation. Stronger balance sheet, bigger dividend As per the annual report, the central bank’s net income surged 27.3 per cent year-on-year to ₹2.69 lakh crore ($32.28 billion) in FY25, up from ₹2.11 lakh crore ($25.32 billion) the previous year. This includes gains of ₹11.1 lakh crore ($133.2 billion) from foreign exchange transactions, and ₹9.7 lakh crore ($116.4 billion) in interest income from foreign securities. The RBI’s balance sheet expanded 8.2 per cent to ₹76.25 lakh crore ($915 billion), with foreign assets accounting for over 74 per cent of the total. Notably, the central bank’s gold holdings rose by 57.5 metric tonnes to 879.6 metric tonnes as of March 2025. A significant portion of the income of ₹2.68 lakh crore ($32.16 billion) has already been transferred to the central government as surplus, a move expected to ease fiscal pressures, support capital spending, and inject liquidity into the banking system by early July, according to economists cited in the report. The report also highlights that the Contingency Risk Buffer (CRB), which helps cushion against economic shocks was maintained at 6.5 per cent, the same level as FY24. Inflation, growth, and monetary policy: RBI’s balancing act The RBI’s latest report offers a cautiously optimistic view of the Indian economy. According to the central bank, headline inflation is likely to converge to the 4 per cent target over the next 12 months, thanks to a favourable mix of macroeconomic conditions. These include easing global supply chain pressures, softening of international commodity prices, and above-normal rainfall boosting agricultural output. At the same time, GDP growth for FY26 is projected at 6.5 per cent, with the momentum driven by private consumption, healthy corporate and banking balance sheets, and the government’s continued focus on capital expenditure. In response to moderating inflation and subdued economic momentum, the RBI has already cut the policy repo rate by 50 basis points since February, and adopted a ‘growth-supportive’ accommodative stance in April. However, the path forward is not without risks. The RBI flagged a range of external headwinds, rising protectionism, geopolitical conflicts, and volatile financial markets that could threaten both inflation and growth targets. Of particular concern is the return of US tariffs under President Donald Trump, which have added uncertainty to global trade flows and emerging market stability. According to the report, “While the outlook remains promising, downside risks to growth and upside risks to inflation persist due to evolving global dynamics.” Digital rupee, FX platform, and CBDC pilots: What’s next for RBI? The RBI is making it clear that India’s digital financial future is no longer experimental, it’s strategic. According to the report, the RBI will expand the pilots for central bank digital currency (CBDC) in both retail (e₹-Retail) and wholesale (e₹-Wholesale) segments. Building on groundwork laid over the past two years, the central bank now plans to test cross-border CBDC transactions, both bilateral and multilateral to make global payments faster, more transparent, and more secure. In addition, the RBI will link its FX-Retail platform with Bharat Connect, a move aimed at democratising access to forex markets for small businesses and individual users. This is particularly significant as India’s foreign exchange reserves peaked at $704 billion in September 2024, and the RBI was the top net seller of forex among Asian central banks in January 2025, according to estimates from Nomura and DBS Bank. The digital push doesn’t end there. The RBI will also roll out new CBDC use cases, such as B2B payments under the Unified Ledger Interface (ULI), and scale up Milehunter.ai™, its AI-driven analytics platform. To accompany this digital acceleration, the central bank will also develop a framework for the responsible and ethical use of AI in the financial sector. These pilots and platforms, the report notes, are designed to overcome persistent inefficiencies in the current system, especially those related to turnaround time, traceability, and cross-border transaction costs. Bank fraud amount triples despite drop in cases One of the more concerning takeaways from the report is the sharp rise in the value of bank frauds. While the total number of fraud cases declined by 34 per cent to 23,953 in FY25, the value of frauds tripled to ₹36,014 crore ($432.17 million), up from roughly ₹12,000 crore ($144 million) in FY24. According to the RBI annual report, this spike was largely due to the reclassification of 122 legacy fraud cases worth ₹18,674 crore ($224.08 million), after a March 2023 Supreme Court ruling mandated re-examination. Private sector banks reported the highest number of fraud incidents at 14,233 cases, accounting for 59.4 per cent of total frauds. But in terms of value, state-owned banks bore the brunt, accounting for ₹25,667 crore ($307.99 million) (71.3 per cent of total fraud value) compared to ₹10,088 crore ($121.05 million) by private lenders. Most of these frauds occurred in two areas: • Digital payments (cards/internet): 13,516 cases, ₹520 crore ($6.24 million) • Loan/advances segment: 7,950 cases, ₹33,148 crore ($398 million) The RBI noted that while digital frauds dominate in private banks, loan-related frauds remain concentrated in public sector banks, raising concerns about credit risk monitoring and recovery.

Amid global tension, the central bank of India's annual report for FY24- 25 delivered a record ₹2.69 lakh crore surplus to the government, by 27.3 per cent from the previous year’s ₹2.11 lakh crore.&nbsp;

From ₹2.69 lakh cr surplus to digital rupee pilots: Here's what RBI’s FY25 annual report outlines

India has emerged as one of the fastest-growing economies in the world. With a population of 1.4 billion people, it appears to be a vast, lucrative market. However, according to the Indus Valley annual report 2025 by Bloom Research, nearly 1 billion people lack the disposable income required for discretionary spending.
<h2>The report reveals a three-tier consumer economy in India</h2>
India1 (10% of population) &ndash; $15,000 per capita income, drives 66% of discretionary spending
India2 (23% of population) &ndash; $3,300 per capita income, contributes 33% of discretionary spending
India3 (67% of population) &ndash; $1,000 per capita income, minimal discretionary spending
According to the report, India's top 10 per cent now controls 57.7 per cent of national income. Meanwhile, the bottom 50 per cent have witnessed a drastic income decline. This can be visible in the consumer trends. High-income groups continue to spend on luxury housing, premium smartphones, and branded goods. The experience economy is also booming, with concert tickets for global artists like Coldplay and Ed Sheeran selling out fast.&nbsp;
The report highlights a steep decline in household savings as a major factor for this mass consumption slowdown. According to the RBI, personal debt is rising, while net financial savings are at a multi-year low. The recent crackdown on easy lending has put more pressure on consumption growth.&nbsp;
<h2>India vs China: Consumption gap</h2>
The report also compares the per capita consumption of India and China. While China is witnessing a broader economic slowdown, the gap between the 2 nations is drastic. India's average per-capita consumption in 2023 was $1493, almost where China was in 2010. This puts India 13 years behind China in terms of consumer spending power.&nbsp;
The report also highlights the risks involved with Automation. The trend of lower spending and wage stagnation coincides with the rise in artificial intelligence disrupting white-collar jobs. This makes employment in services and manufacturing more uncertain.&nbsp;
There is, however, a bright spot to consider. Rising rural demand the recent tax break announced in the budget could provide a slight boost to consumption.&nbsp;

Business & Economy, According to the Indus Valley annual report 2025 by Bloom Research, nearly 1 billion people lack the disposable income required for discretionary spending.

India has emerged as one of the fastest-growing economies in the world. With a population of 1.4 billion people, it appears to be a vast, lucrative market. However, according to the Indus Valley annual report 2025 by Bloom Research, nearly 1 billion people lack the disposable income required for discretionary spending. The report reveals a three-tier consumer economy in India India1 (10% of population) – $15,000 per capita income, drives 66% of discretionary spending India2 (23% of population) – $3,300 per capita income, contributes 33% of discretionary spending India3 (67% of population) – $1,000 per capita income, minimal discretionary spending According to the report, India's top 10 per cent now controls 57.7 per cent of national income. Meanwhile, the bottom 50 per cent have witnessed a drastic income decline. This can be visible in the consumer trends. High-income groups continue to spend on luxury housing, premium smartphones, and branded goods. The experience economy is also booming, with concert tickets for global artists like Coldplay and Ed Sheeran selling out fast. The report highlights a steep decline in household savings as a major factor for this mass consumption slowdown. According to the RBI, personal debt is rising, while net financial savings are at a multi-year low. The recent crackdown on easy lending has put more pressure on consumption growth. India vs China: Consumption gap The report also compares the per capita consumption of India and China. While China is witnessing a broader economic slowdown, the gap between the 2 nations is drastic. India's average per-capita consumption in 2023 was $1493, almost where China was in 2010. This puts India 13 years behind China in terms of consumer spending power. The report also highlights the risks involved with Automation. The trend of lower spending and wage stagnation coincides with the rise in artificial intelligence disrupting white-collar jobs. This makes employment in services and manufacturing more uncertain. There is, however, a bright spot to consider. Rising rural demand the recent tax break announced in the budget could provide a slight boost to consumption.

Is 'inclusion' missing from India's growth story?

In a dramatic turnaround, the rupee staged its strongest comeback in nearly two years. <o:p></o:p>The currency gained about 1.5 per cent from its all-time low hit on Monday. <o:p></o:p>This comes despite a deep crash in Indian stocks, which extended to Wednesday.<o:p></o:p>
The significant rise in the rupee was propelled by the Reserve Bank of India's aggressive intervention. <o:p></o:p>Reports show the central bank sold about 5 billion dollars via state-owned banks to stabilise the currency. <o:p></o:p>The RBI's action was a direct reaction to the currency's recent turmoil.<o:p></o:p>
The rupee crashed to reach a record low of 87.95 versus the US dollar on Monday, sending shockwaves through the market. <o:p></o:p>The RBI's action triggered a sharp reversal, creating a domino effect that boosted the currency's recovery. <o:p></o:p>However, the RBI burning through its forex reserves to support the rupee is raising some concerns.<o:p></o:p>
While India's forex reserves are still healthy at about 631 billion dollars, the 10-month worth of import cover has fallen over 70 billion dollars since a record high of around 705 billion dollars in September last year. <o:p></o:p>India's forex war chest is well above the average of about 300 billion dollars between 1998 and 2025.<o:p></o:p>
<h2 class="MsoNormal">Rupee recovers amid stock market chaos<o:p></o:p></h2>
Still, the risks are of more foreign outflows amid an escalating trade war hurting the country's import cover. <o:p></o:p>What is also worrying is the deep sell-off in Indian stocks, with benchmark stock indices extending their massive losses for the sixth straight session.<o:p></o:p>
The Sensex crashed over 700 points to fall below the 76,000 points mark. <o:p></o:p>The broader Nifty index also was in the red. <o:p></o:p>The selloff has already erased over 9 trillion rupees in investor wealth. <o:p></o:p>This was prompted by the withdrawal of foreign institutional investors and increasing global tensions.<o:p></o:p>
The decision by US President Donald Trump to impose a 25 per cent tax on steel and aluminium imports, together with threats of retaliatory tariffs, caused significant disruption in global markets. <o:p></o:p>The turmoil in Indian stocks comes despite a pullback in global markets.<o:p></o:p>
Asian and European stocks showed glimpses of a reversal to gains, suggesting traders are starting to feel numb on the trade war headlines. <o:p></o:p>Wall Street futures, though, pointed to a mixed open, similar to Tuesday's close.
<o:p></o:p>The comments from Federal Reserve's Chief Jerome Powell that the central bank is in no rush to cut rates weigh on sentiment. <o:p></o:p>Fed chief's remarks also showed inflation concerns from the ongoing trade war. So, ahead of key US inflation data, investors remained on the sidelines.<o:p></o:p>
(With the inputs from the agencies)<o:p></o:p>

Business & Economy: In a dramatic turnaround, the rupee staged its strongest comeback in nearly two years. The currency gained about 1.5 per cent from its all-time low hit on Monday.

In a dramatic turnaround, the rupee staged its strongest comeback in nearly two years. The currency gained about 1.5 per cent from its all-time low hit on Monday. This comes despite a deep crash in Indian stocks, which extended to Wednesday. The significant rise in the rupee was propelled by the Reserve Bank of India's aggressive intervention. Reports show the central bank sold about 5 billion dollars via state-owned banks to stabilise the currency. The RBI's action was a direct reaction to the currency's recent turmoil. The rupee crashed to reach a record low of 87.95 versus the US dollar on Monday, sending shockwaves through the market. The RBI's action triggered a sharp reversal, creating a domino effect that boosted the currency's recovery. However, the RBI burning through its forex reserves to support the rupee is raising some concerns. While India's forex reserves are still healthy at about 631 billion dollars, the 10-month worth of import cover has fallen over 70 billion dollars since a record high of around 705 billion dollars in September last year. India's forex war chest is well above the average of about 300 billion dollars between 1998 and 2025. Rupee recovers amid stock market chaos Still, the risks are of more foreign outflows amid an escalating trade war hurting the country's import cover. What is also worrying is the deep sell-off in Indian stocks, with benchmark stock indices extending their massive losses for the sixth straight session. The Sensex crashed over 700 points to fall below the 76,000 points mark. The broader Nifty index also was in the red. The selloff has already erased over 9 trillion rupees in investor wealth. This was prompted by the withdrawal of foreign institutional investors and increasing global tensions. The decision by US President Donald Trump to impose a 25 per cent tax on steel and aluminium imports, together with threats of retaliatory tariffs, caused significant disruption in global markets. The turmoil in Indian stocks comes despite a pullback in global markets. Asian and European stocks showed glimpses of a reversal to gains, suggesting traders are starting to feel numb on the trade war headlines. Wall Street futures, though, pointed to a mixed open, similar to Tuesday's close. The comments from Federal Reserve's Chief Jerome Powell that the central bank is in no rush to cut rates weigh on sentiment. Fed chief's remarks also showed inflation concerns from the ongoing trade war. So, ahead of key US inflation data, investors remained on the sidelines. (With the inputs from the agencies)

Rupee stages epic comeback despite stocks crash

The world's leading consumer goods firms are investing in a once-every-ten years Mahakumbh in the hopes that it will help reverse the slowdown in spending in India. About 450 million people, including farmers, millionaires, office workers, and mystics, will attend the six-week Mahakumbh mela in the northern Indian city of Prayagraj.<o:p></o:p>
The Mahakumbh pilgrimage is being billed as the greatest gathering on earth. The event has attracted a rush of spending from global heavyweights, including Nestle, makers of Pepsi, Coca-Cola, Reliance Industries, Hindustan Unilever, and Reckitt Benckiser Group, the owner of Dettol, among others. Mahakumbh is being touted as the biggest marketing opportunity in the world. The streets leading to the river Ganga, where Hindus believe one may wash away their sins in a dip, are lined with billboards, vendors, and branded resting spots.<o:p></o:p>
<h2>Consumer firms invest big money in Mahakumbh</h2>
Independent brand consultant Harish Bijoor predicted that companies will spend around 36 billion rupees or 310 million dollars on advertising and marketing. Big brands are using India's biggest pilgrimage to lure consumers. However, they have a challenging job ahead as the celebrations come to a close on February 26. The Indian government predicts that the event will inject 23 billion dollars into the flagging economy. While industry observers are sceptical of the massive crowds translating to major sales, this year's event is even more tempting for companies. It is considered exceptionally auspicious owing to a celestial alignment that occurs every 144 years. During the preparation, the state of Uttar Pradesh started constructing bridges, marketplaces, and hospitals months in advance of the event to handle the huge flow of people &mdash; around one-third of India's entire population.&nbsp;Consumer powerhouses are peddling their products to a captive audience in the makeshift tent city along the riverbanks. From branded blankets to resting pods, to ads in temporary restrooms, to mini stores by rapid delivery service firms to community lunches to Instagram video posts for branding to mobile ATMs and Kumbh-labelled debit cards, companies are using the event for marketing their products in a significant way. Dolat capital market analyst Sachin Bobade remarked that companies go there to reach a massive audience. He predicted a small but noticeable increase in demand. Bobade said, "There's a fear of missing out on Kumbh. Overall market conditions aren't great. There will be some demand uplift, but it will not be major." he added, "The slowdown is a bit dramatic. We will need six maha Kumbhs to...lift demand." The government, though, hopes the religious gathering helps the economy out of a slump. The big spending by large corporations focussing on branding during the event does provide significant optimism.
&nbsp;
(With the inputs from the agencies)<o:p></o:p>

Business & Economy: Mahakumbh has attracted a rush of spending from global heavyweights, including Nestle, makers of Pepsi, Coca-Cola, Reliance Industries, Hindustan Unilever, and Reckitt Benckiser Group, the owner of Dettol, among others.

The world's leading consumer goods firms are investing in a once-every-ten years Mahakumbh in the hopes that it will help reverse the slowdown in spending in India. About 450 million people, including farmers, millionaires, office workers, and mystics, will attend the six-week Mahakumbh mela in the northern Indian city of Prayagraj. The Mahakumbh pilgrimage is being billed as the greatest gathering on earth. The event has attracted a rush of spending from global heavyweights, including Nestle, makers of Pepsi, Coca-Cola, Reliance Industries, Hindustan Unilever, and Reckitt Benckiser Group, the owner of Dettol, among others. Mahakumbh is being touted as the biggest marketing opportunity in the world. The streets leading to the river Ganga, where Hindus believe one may wash away their sins in a dip, are lined with billboards, vendors, and branded resting spots. Consumer firms invest big money in Mahakumbh Independent brand consultant Harish Bijoor predicted that companies will spend around 36 billion rupees or 310 million dollars on advertising and marketing. Big brands are using India's biggest pilgrimage to lure consumers. However, they have a challenging job ahead as the celebrations come to a close on February 26. The Indian government predicts that the event will inject 23 billion dollars into the flagging economy. While industry observers are sceptical of the massive crowds translating to major sales, this year's event is even more tempting for companies. It is considered exceptionally auspicious owing to a celestial alignment that occurs every 144 years. During the preparation, the state of Uttar Pradesh started constructing bridges, marketplaces, and hospitals months in advance of the event to handle the huge flow of people — around one-third of India's entire population. Consumer powerhouses are peddling their products to a captive audience in the makeshift tent city along the riverbanks. From branded blankets to resting pods, to ads in temporary restrooms, to mini stores by rapid delivery service firms to community lunches to Instagram video posts for branding to mobile ATMs and Kumbh-labelled debit cards, companies are using the event for marketing their products in a significant way. Dolat capital market analyst Sachin Bobade remarked that companies go there to reach a massive audience. He predicted a small but noticeable increase in demand. Bobade said, "There's a fear of missing out on Kumbh. Overall market conditions aren't great. There will be some demand uplift, but it will not be major." he added, "The slowdown is a bit dramatic. We will need six maha Kumbhs to...lift demand." The government, though, hopes the religious gathering helps the economy out of a slump. The big spending by large corporations focussing on branding during the event does provide significant optimism. (With the inputs from the agencies)

Mahakumbh to add $23 billion to India's economy

As India approaches its next budget, the economists are faced with a fine balancing act: Ensuring sustained economic growth, while managing inflation, bolstering consumer demand, and sticking to the fiscal discipline. Even though the economic survey 2024-25 gives a rosy outlook for the country's growth, a close inspection shows the need for addressing concerns through level-headed policy interventions. Now let us take a look at the high points from the economic survey.&nbsp;
<h2>Highlights of the Economic Survey: Focus on Growth</h2>
- Real GDP growth for FY25: 6.4% - Services sector growth supports momentum - The big concern: growth is slowing
India's first advance estimates project a 6.4 per cent real GDP growth for FY25, driven by 7.2 per cent growth in services. However, this pace is slowing relative to the growth achieved in preceding years, mainly due to softening gross capital formation.
Unlocking private investment for sustainable growth will be the central challenge before the government in the upcoming budget. These could include measures directed at increasing the ease of doing business, access to credit, especially for MSMEs, and much-needed targeted tax incentives for private investment.&nbsp;
<h2>Highlights of the Economic Survey:&nbsp;Focus on inflation</h2>
- Retail inflation in FY24: 5.4% - Retail inflation in FY25: 4.9% - Food inflation is still persistent
Retail inflation dipped to 4.9 per cent in FY25 from 5.4 per cent in FY24 mostly due to lower core inflation. While food inflation is a concern, a further rise in food inflation is also seen as a very disconcerting phenomenon that's mainly driven by volatility in the prices of essential commodities such as pulses and vegetables. The government has launched buffer stock interventions and relaxed import duties on pulses to contain surges in prices, though food prices continue to feel pressure from disruptive weather patterns and supply chain causes.&nbsp;
To tackle inflationary pressures, the budget is likely to give the highest priority to building climate-resilient agricultural practices, cold storage infrastructure, and policies to stabilise food supply chains. It is suggested to diversify essential commodities and resist supply shocks through monitoring.&nbsp;
<h2>Highlights of the Economic Survey: Focus on consumer demand</h2>
- Revival in rural demand - Urban demand shows mixed trends - Urban passenger vehicle sales slow - FMCG sales remain moderate - Air passenger traffic grows
The report says consumer demand showed a notable uptick, largely driven by a revival in rural demand. This resurgence is attributed to record kharif production and higher minimum support prices. In contrast, urban demand displayed mixed trends&mdash;passenger vehicle sales growth slowed in the previous year, and FMCG sales remained moderate, although air passenger traffic saw steady growth.
A major concern is whether rural demand can sustain itself beyond the harvest season. The government could consider direct cash transfers, rural employment programs, and enhanced credit availability to sustain rural consumption. Additionally, policies aimed at boosting urban consumer sentiment&mdash;such as tax relief for middle-income households and incentives for discretionary spending&mdash;could support broader demand recovery.
<h2>Highlights of the Economic Survey: Focus on fiscal prudence</h2>
-CAPEX has improved -Fiscal discipline improves
Despite increase in capital expenditure, the fiscal discipline in the country has continued to improve over the years. The constraints on general government dis-savings managed to keep macroeconomic instability at bay. Yet maintaining this discipline while accessing development and welfare spending remains a challenge.
The government needs to undertake spending targeted towards welfare for its next budget, beyond long-term broad-based subsidy. Moreover, boosting tax compliance and widening the tax base through digitalization and formalization of the informal economy can improve fiscal health without burdening taxpayers excessively.
While the economic survey indicates that the Indian economy is in good shape, several headwinds persist. Global uncertainties, inflationary risks, and domestic demand inconsistencies necessitate a pragmatic approach.
Experts say the union budget must prioritize policy measures that stimulate investment, control inflation, bolster consumer confidence, and maintain fiscal prudence to achieve developed nation status by 2047.

Business & Economy, India's first advance estimates project a 6.4 per cent real GDP growth for FY25. However, this pace is slow relative to the growth achieved in preceding years.

As India approaches its next budget, the economists are faced with a fine balancing act: Ensuring sustained economic growth, while managing inflation, bolstering consumer demand, and sticking to the fiscal discipline. Even though the economic survey 2024-25 gives a rosy outlook for the country's growth, a close inspection shows the need for addressing concerns through level-headed policy interventions. Now let us take a look at the high points from the economic survey. Highlights of the Economic Survey: Focus on Growth - Real GDP growth for FY25: 6.4% - Services sector growth supports momentum - The big concern: growth is slowing India's first advance estimates project a 6.4 per cent real GDP growth for FY25, driven by 7.2 per cent growth in services. However, this pace is slowing relative to the growth achieved in preceding years, mainly due to softening gross capital formation. Unlocking private investment for sustainable growth will be the central challenge before the government in the upcoming budget. These could include measures directed at increasing the ease of doing business, access to credit, especially for MSMEs, and much-needed targeted tax incentives for private investment. Highlights of the Economic Survey: Focus on inflation - Retail inflation in FY24: 5.4% - Retail inflation in FY25: 4.9% - Food inflation is still persistent Retail inflation dipped to 4.9 per cent in FY25 from 5.4 per cent in FY24 mostly due to lower core inflation. While food inflation is a concern, a further rise in food inflation is also seen as a very disconcerting phenomenon that's mainly driven by volatility in the prices of essential commodities such as pulses and vegetables. The government has launched buffer stock interventions and relaxed import duties on pulses to contain surges in prices, though food prices continue to feel pressure from disruptive weather patterns and supply chain causes. To tackle inflationary pressures, the budget is likely to give the highest priority to building climate-resilient agricultural practices, cold storage infrastructure, and policies to stabilise food supply chains. It is suggested to diversify essential commodities and resist supply shocks through monitoring. Highlights of the Economic Survey: Focus on consumer demand - Revival in rural demand - Urban demand shows mixed trends - Urban passenger vehicle sales slow - FMCG sales remain moderate - Air passenger traffic grows The report says consumer demand showed a notable uptick, largely driven by a revival in rural demand. This resurgence is attributed to record kharif production and higher minimum support prices. In contrast, urban demand displayed mixed trends—passenger vehicle sales growth slowed in the previous year, and FMCG sales remained moderate, although air passenger traffic saw steady growth. A major concern is whether rural demand can sustain itself beyond the harvest season. The government could consider direct cash transfers, rural employment programs, and enhanced credit availability to sustain rural consumption. Additionally, policies aimed at boosting urban consumer sentiment—such as tax relief for middle-income households and incentives for discretionary spending—could support broader demand recovery. Highlights of the Economic Survey: Focus on fiscal prudence -CAPEX has improved -Fiscal discipline improves Despite increase in capital expenditure, the fiscal discipline in the country has continued to improve over the years. The constraints on general government dis-savings managed to keep macroeconomic instability at bay. Yet maintaining this discipline while accessing development and welfare spending remains a challenge. The government needs to undertake spending targeted towards welfare for its next budget, beyond long-term broad-based subsidy. Moreover, boosting tax compliance and widening the tax base through digitalization and formalization of the informal economy can improve fiscal health without burdening taxpayers excessively. While the economic survey indicates that the Indian economy is in good shape, several headwinds persist. Global uncertainties, inflationary risks, and domestic demand inconsistencies necessitate a pragmatic approach. Experts say the union budget must prioritize policy measures that stimulate investment, control inflation, bolster consumer confidence, and maintain fiscal prudence to achieve developed nation status by 2047.

India's Economic Survey: focus on growth, inflation & fiscal prudence

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