Tamil Nadu Chief Minister M.K. Stalin accused the Centre of denying States their due share of financial devolution and undermining the independence of Finance Commissions, driven by "narrow political motives." He urged other States to form committees to protect their rights and promote federalism. Stalin highlighted historical efforts for State autonomy, including the Justice Rajamannar Committee (1969) and the Sarkaria Commission (1983), which warned against excessive centralisation. He also criticized the Union government's push for Hindi and its interference in Opposition-ruled States, advocating for stronger, self-reliant States for a united India.
- Tamil Nadu CM M.K. Stalin alleges the Centre is politically motivated in denying States their financial share and undermining Finance Commissions.
- He advocates for greater State autonomy and federalism, urging other States to join the movement.
- Historical commissions like Justice Rajamannar Committee and Sarkaria Commission have previously addressed Union-State relations and centralisation.
The Group of Ministers (GoM) on Rate Rationalisation has accepted the Centre's proposal for a simplified two-rate Goods and Services Tax (GST) structure, recommending it to the GST Council. The reform aims to reduce the weighted average GST rate from 14.4% to 9.5% by FY26-27. The proposal involves retaining the 5% and 18% slabs while eliminating the 12% and 28% slabs. Most items from the abolished slabs will shift to the 5% or 18% categories. However, 'sin' goods and services like tobacco, cigarettes, and online real-money gaming, previously in the 28% slab, will move to a higher 40% slab, with the existing compensation cess on these items being removed. States have raised concerns about potential revenue loss.
- The GoM on Rate Rationalisation has endorsed the Centre's proposal for a two-rate GST structure.
- The new structure will retain 5% and 18% slabs, eliminating the 12% and 28% slabs.
- 'Sin' goods and services will be moved to a higher 40% slab, replacing the existing compensation cess.
The Lok Sabha passed the Promotion and Regulation of Online Gaming Bill, 2025, by voice vote, aiming to prohibit the offering, operation, facilitation, advertisement, promotion, and participation in online money games, specifically targeting fantasy sports and card games where users risk money. The Bill defines 'real money gaming' to include platforms like Dream11 and PokerBaazi. The online gaming industry, with annual revenues exceeding ₹31,000 crores and employing over two lakh people, faces strict regulations. Punishments for violations include imprisonment up to three years and/or fines up to ₹1 crore. The legislation also bans related advertisements and restricts financial institutions from transferring funds for such games.
- The Lok Sabha passed a Bill to prohibit real money online gaming, including fantasy sports and card games where users risk money.
- The Bill aims to regulate and ban the operation, promotion, and participation in such online games.
- Penalties for violations include significant imprisonment terms and hefty fines.
India's Ministry of Finance released a draft Climate Finance Taxonomy to mobilize climate-aligned investments, prevent greenwashing, and clarify contributions to mitigation, adaptation, or transition. The article proposes a robust review architecture, including annual reviews for timely course correction and recurring five-year reviews aligned with India's Nationally Determined Contributions and global stocktake. It emphasizes legal coherence with existing laws (Energy Conservation Act, SEBI norms, Carbon Credit Trading Scheme) and international obligations, ensuring clarity and enforceability. The taxonomy's success hinges on transparent review, stakeholder engagement, and accessibility for all sectors, including MSMEs and the informal sector.
- India's draft Climate Finance Taxonomy aims to guide climate-aligned investments, combat greenwashing, and clarify contributions to climate goals.
- A two-tiered review mechanism is proposed: annual reviews for course correction and five-year comprehensive reviews aligned with national and international climate commitments.
- The review must ensure legal coherence with Indian laws like the Energy Conservation Act and SEBI norms, and international obligations.
India has achieved its target of 20% ethanol blending (E20) in petrol five years ahead of schedule, driven by fiscal incentives for the sugarcane industry. While the government cites benefits like reduced emissions, increased farmer income, and lower oil import bills, vehicle owners express concerns about reduced mileage and increased maintenance. The policy's environmental impact is debated, especially regarding the water-intensive nature of sugarcane cultivation and its contribution to land degradation. India is also diversifying ethanol sources to include rice and corn, leading to increased corn imports. The US views India's policy as a trade barrier. Furthermore, the article questions if ethanol blending truly aids decarbonization compared to the faster adoption of EVs, which faces its own challenges like dependence on rare earth elements.
- India achieved its 20% ethanol blending target (E20) ahead of schedule, primarily using sugarcane.
- Vehicle owners report concerns about reduced mileage and higher maintenance costs with E20 petrol.
- The environmental sustainability of sugarcane-based ethanol is questioned due to its high water demand and impact on land degradation.
The Jan Vishwas (Amendment of Provisions) Bill, 2025, is set to be introduced in the Lok Sabha to decriminalise minor offences, promoting ease of living and doing business. This bill proposes amendments to over 350 provisions across various enactments. It builds upon the Jan Vishwas (Amendment to Provisions) Act, 2023, which previously decriminalised 183 provisions. The government's initiative aims to abolish unnecessary laws that lead to imprisonment for trivial matters, simplify legal frameworks, and enhance trust-based governance, reflecting Prime Minister Modi's commitment to improving India's business climate and placing public interests first.
- The Jan Vishwas (Amendment of Provisions) Bill, 2025, aims to decriminalise minor offences.
- The primary goal is to promote ease of living and doing business in India.
- Over 350 provisions are proposed to be amended through this new Bill.
India is reshaping its engagement with Africa through a quieter, adaptive approach, focusing on shared historical solidarities, pragmatic cooperation, and long-term investments, exemplified by its relationship with Namibia. This contrasts with Western engagement often tied to conditional aid. India's strategy includes targeted investments in capacity-building, like the India-Namibia Centre of Excellence in IT, and promoting knowledge-based cooperation, such as Namibia's adoption of India's UPI. While the recent Indian head of government's visit to Namibia yielded modest outcomes, missing major agreements on critical minerals, India's approach emphasizes trust, inclusive dialogue, and letting African priorities shape the agenda, aiming for sustained investment and institutional coherence.
- India is adopting a new, adaptive, and trust-based approach to engaging African nations, distinct from Western models.
- The strategy involves leveraging shared historical ties, fostering pragmatic cooperation, and making long-term investments.
- Key initiatives include capacity-building in IT and promoting knowledge-based cooperation, such as Namibia's adoption of India's UPI.
The Income Tax Bill 2025, passed by Parliament, replaces the outdated Income Tax Act of 1961, aiming for simpler, more concise, and clearer legislation. It significantly reduces the number of chapters and sections, increases tables and formulae for clarity, and simplifies language. Taxpayer-friendly features include allowing updates to income tax returns up to four years from the assessment year's end without penalty and reducing the assessment reopening period to five years. However, new provisions regarding searches by tax officials are concerning, as they mandate sharing passwords for electronic documents, including social media and personal emails, and empower officials to override computer system access codes, raising privacy issues.
- The Income Tax Bill 2025 replaces the Income Tax Act of 1961, aiming to simplify and rationalize India's income tax legislation.
- The new Bill significantly reduces the number of chapters (from 47 to 23) and sections (from 819 to 536) while simplifying language.
- Taxpayer-friendly provisions include allowing income tax returns to be updated up to four years from the assessment year's end without penalty.
India's digital trade compact, Chapter 12 of the India-U.K. Comprehensive Economic and Trade Agreement (CETA), marks a new step in global digital economy engagement. The agreement offers "digital wins" like mutual recognition of electronic signatures, paperless trade, and zero customs duties for electronic transmissions, boosting India's software export pipeline (estimated at $30 billion annually). However, critics raise "digital costs," such as India stepping back from source-code checks as a default regulatory tool. While government procurement is excluded, and a general security exception exists, the compact lacks "automatic MFN" for cross-border data flows, instead relying on a forward review mechanism. The agreement reflects India's shift towards strategic engagement but highlights the need for robust domestic regulatory frameworks like the Digital Personal Data Protection Act of 2023 and regular reviews to align with evolving risks.
- The India-U.K. Comprehensive Economic and Trade Agreement (CETA) includes a significant digital trade compact.
- Key benefits ("digital wins") include recognition of electronic signatures, paperless trade, and zero customs duties for electronic transmissions, boosting software exports.
- Concerns ("digital costs") include India's potential retreat from source-code checks as a default regulatory tool, though case-by-case access is allowed.
India faces significant trade challenges, particularly with the US imposing 25% tariffs on seafood, potentially rising to 50%. The government is exploring adjustments to the Export Promotion Mission (EPM), a multi-Ministry project with a ₹2,250 crore outlay for FY25, aimed at supporting Micro, Small, and Medium Enterprises (MSMEs) by providing cheaper export credit and overcoming non-trade barriers. Bilateral trade agreement negotiations with the US are deadlocked, prompting a call for India to diversify into other markets and refashion trade ties with neighbours like China. The MSME sector, contributing nearly half of goods exports and employing 28 crore people, requires drastic governmental intervention, with specific demands for credit moratoriums and interest subvention from affected sectors like seafood and textiles.
- India is facing trade challenges, including 25% US tariffs on seafood, which could increase to 50%.
- The government is considering tweaking the Export Promotion Mission (EPM) to support MSMEs with export credit and address non-trade barriers.
- Bilateral trade negotiations with the US are stalled, necessitating a diversification of India's trade markets.
The Centre has proposed significant reforms to the Goods and Services Tax (GST) system, aiming to reduce the number of tax slabs. The 12% and 28% slabs are set to be eliminated, retaining primarily the 5% and 18% rates. A new concessional rate below 1% will be introduced for items like gold and silver, alongside a high "sin rate" of 40% for five to seven specific goods such as tobacco and gutka. This rationalization will move 99% of items from the 12% slab to 5% and 90% from the 28% slab to 18%. The reforms, part of "next-generation GST reforms," are expected to reduce the tax burden on common citizens and boost consumption, though they may initially impact revenue.
- The Centre proposes to overhaul the GST structure by eliminating the 12% and 28% tax slabs.
- The new structure will primarily retain 5% and 18% slabs, with a sub-1% concessional rate and a 40% "sin rate."
- Most items from the abolished 12% and 28% slabs will be moved to the 5% and 18% categories, respectively.
Prime Minister Narendra Modi, in his Independence Day address, emphasized self-reliance (aatmanirbharta) across economic and security sectors. He announced major reforms including Mission Sudarshan Chakra for air defence by 2035, Pradhan Mantri Viksit Bharat Rozgar Yojana offering ₹15,000 grants for first-time private sector employees, and the launch of 'Made-in-India' semiconductor chips by 2025. India aims to increase nuclear energy capacity tenfold by 2047. Modi also highlighted the success of Indian-made arms in Operation Sindoor and stressed innovation in AI, cyber security, and deep-tech. A significant part of his speech warned of a "conspiracy to change the country's demographic make-up," leading to the establishment of a High Powered Demographic Mission.
- Prime Minister Modi's Independence Day speech focused on national self-reliance, economic reforms, and security enhancements.
- Key initiatives announced include Mission Sudarshan Chakra for air defence, Pradhan Mantri Viksit Bharat Rozgar Yojana for employment, and 'Made-in-India' semiconductor chips.
- India plans to significantly boost its nuclear energy capacity and emphasized innovation in critical technologies like AI and cybersecurity.
India is experiencing a temporary dip in retail inflation, with July's figure at 1.55%, the lowest since June 2017, primarily due to contracting food prices and a favorable base effect. Core inflation also fell to 4.1%, aligning with RBI's target. While the inflation outlook appears positive, especially with a good monsoon, concerns about a growth slowdown persist. Indicators like the Index of Industrial Production (IIP) at a 10-month low, single-digit GST revenue growth, contracting direct tax collections, and an 18-month low in car sales suggest a lack of robust economic activity. The RBI maintains an optimistic 6.5% growth forecast, but structural problems, weak demand, and potential impacts from U.S. tariffs mean the temporary inflation dip offers only limited relief.
- Retail inflation in July fell to 1.55%, the lowest since June 2017, mainly due to contracting food prices.
- Core inflation also dropped to 4.1%, meeting the RBI's target.
- Despite positive inflation trends, India faces concerns about a growth slowdown.
The increasing integral role of drones in modern warfare, highlighted by recent conflicts, presents an opportunity for India to become a significant supplier in the Indo-Pacific drone market. With the U.S. struggling to meet domestic and export demands due to regulations like the Missile Technology Control Regime (MTCR), and China/Türkiye being unreliable partners for India, a vacuum exists. India, needing advanced UAVs for its diverse terrains and contested borders, can leverage its technological advancements and existing ties with Israel to develop and supply fixed-wing UAVs. This would not only fulfill its own strategic needs but also boost trade and influence with Indo-Pacific countries facing similar maritime domain awareness and high-altitude border patrol requirements, fostering trust-based relationships in a polarized region.
- Drones have become crucial for precision strikes in modern warfare, as demonstrated by recent conflicts.
- A vacuum exists in the Indo-Pacific drone market due to U.S. export limitations (e.g., MTCR) and India's adversarial relations with China and Türkiye.
- India needs advanced UAVs for maritime domain awareness and high-altitude border patrol across its diverse and contested borders.
African nations are increasingly scrutinizing China's long-standing dominance in their mining sector, demanding greater value addition, transparency, and local benefits. This shift is driven by a new wave of resistance from governments and civil society, challenging the traditional model of raw resource extraction in exchange for infrastructure. Countries like the Democratic Republic of Congo (DRC) are renegotiating contracts, while Zimbabwe and Namibia have banned unprocessed lithium exports to force local processing. Although China remains Africa's largest mining partner, its hegemony is no longer guaranteed as African governments reassert sovereignty over natural resources, enforce environmental standards, and redraw engagement terms to foster economic transformation and local participation in the global mineral supply chain.
- African nations are increasingly challenging China's dominance in their mining sector.
- The shift is driven by demands for fairer, more transparent partnerships, local value addition, and economic sovereignty.
- Countries like DRC are renegotiating existing contracts, while Zimbabwe and Namibia have banned unprocessed lithium exports.
The Union government is considering revising the parental income limits for eligibility in post and pre-matric scholarships for Scheduled Castes (SCs), Scheduled Tribes (STs), Other Backward Classes (OBCs), and Denotified Tribes (DNTs). The Ministry of Tribal Affairs proposes raising the limit for ST scholarships to ₹4.5 lakh from the current ₹2.5 lakh, with similar discussions for SCs, OBCs, and DNTs. This move comes as data shows a significant drop in beneficiaries across these categories from 2020-21 to 2024-25. Parliamentary committees have recommended a "suitable rise" in income limits, emphasizing that the current low limits prevent many needy families from accessing these centrally sponsored schemes, which are funded by both Union and State governments.
- The Union government is reviewing parental income limits for pre-matric and post-matric scholarships for SCs, STs, OBCs, and DNTs.
- The Ministry of Tribal Affairs suggests raising the income limit for ST scholarships to ₹4.5 lakh from ₹2.5 lakh.
- The number of beneficiaries for these scholarships has significantly decreased across all categories from 2020-21 to 2024-25.
The Indian National Space Promotion and Authorisation Centre (IN-SPACE) has selected the PixxelSpace India-led consortium to design, build, and operate India's first fully indigenous commercial Earth Observation (EO) satellite constellation under a Public-Private Partnership (PPP) model. This consortium, comprising Piersight Space, Satsure Analytics India, and Dhruva Space, will invest over ₹1,200 crore to launch a constellation of 12 state-of-the-art EO satellites over the next five years. The initiative aims to reduce India's reliance on foreign sources for high-resolution satellite data, ensure data sovereignty, and provide Analysis Ready Data (ARD) and Value-Added Services (VAS) for various applications, including climate change monitoring, disaster management, agriculture, and national security.
- IN-SPACE has selected the PixxelSpace India-led consortium for India's first indigenous commercial Earth Observation (EO) satellite constellation.
- The project will operate under a Public-Private Partnership (PPP) model.
- The consortium plans to invest over ₹1,200 crore to launch 12 state-of-the-art EO satellites within five years.
The Indian government is modifying its Export Promotion Mission to specifically target sectors most affected by increased U.S. tariffs, such as textiles, organic chemicals, and machinery. This revamped mission, initially allocated ₹2,250 crore in the 2025-26 Union Budget, aims to reduce credit costs for MSME borrowers in these sectors, expedite clearances, and provide export incentives. The effort involves multiple ministries and extensive consultations with industry stakeholders, with a particular focus on revamping a credit guarantee scheme for MSMEs to concentrate on their export activities. This strategic shift seeks to build a resilient trade strategy against global shocks.
- India is revamping its Export Promotion Mission to counter increased U.S. tariffs on Indian imports.
- The mission will specifically target tariff-hit sectors like textiles, organic chemicals, and machinery.
- Key measures include reducing credit costs, expediting clearances, and providing export incentives for MSME exporters.
The Union Cabinet has approved four new semiconductor projects under the India Semiconductor Mission (ISM), bringing the total to ten. Two plants will be in Bhubaneswar (Odisha), and one each in Punjab and Andhra Pradesh. These projects have a cumulative value of ₹4,594 crore and are supported by the ₹76,000-crore ISM. The firms involved include SiCSem (silicon carbide integrated facility), Continental Device India Private Limited (expanding existing facility), 3D Glass Solutions Inc. (advanced packaging), and Advanced System in Package (ASIP) Technologies (semiconductor unit). The initiative aims to boost India's capacity in critical semiconductor technologies, particularly silicon carbide.
- The Union Cabinet has approved four new semiconductor manufacturing projects under the India Semiconductor Mission.
- These projects, located in Odisha, Punjab, and Andhra Pradesh, will enhance India's domestic semiconductor production capabilities.
- The mission provides significant financial support to semiconductor units, totaling ₹76,000 crore.
The government's Employment Linked Incentive (ELI) Scheme, with an outlay of ₹99,446 crore, aims to generate employment but is criticized for its employer-centric approach. Critics argue it overlooks skill mismatches, potentially strengthening employers' bargaining power, and exacerbating wage gaps. The scheme prioritizes the formal manufacturing sector, indirectly marginalizing the 90% informal workforce and potentially normalizing disguised unemployment. This sectoral focus is seen as outdated, as manufacturing's employment elasticity is declining, while agriculture and services employ the majority. Alternatives proposed include investing in skilling and education reforms, focusing on long-term sustained employment, and adopting an equitable development strategy.
- The ELI Scheme is criticized for being employer-centric and failing to address the fundamental skill mismatch in the Indian labor market.
- The scheme's focus on the formal manufacturing sector risks marginalizing the vast informal workforce and deepening structural inequalities.
- Concerns are raised about the potential for the scheme to normalize disguised unemployment and for enterprises to mislabel existing jobs as new.
India's retail inflation, measured by the Consumer Price Index (CPI), dropped to an 8-year low of 1.55% in July, the lowest since June 2017. This figure is below the Reserve Bank of India's comfort band of 2% to 6%. The decline is primarily attributed to a significant drop in food prices, with the food and beverages category experiencing deflation at -0.8% in July. Core inflation, which excludes volatile food and fuel prices, also eased to 4.1% in July 2025 from 4.4% in the previous month, nearing RBI's target of 4%.
- Retail inflation in India has fallen to its lowest level in eight years, driven by a decrease in food prices.
- The Consumer Price Index (CPI) is the primary measure for retail inflation, released by the Ministry of Statistics and Programme Implementation.
- The current inflation rate is below the RBI's comfort band, indicating a favorable economic trend.
The Supreme Court has admitted an appeal against the National Company Law Appellate Tribunal (NCLAT) judgment in the Google antitrust case. The Competition Commission of India (CCI) had found Google abused its dominant position in Android by mandating its Play Billing System (GPBS) for in-app purchases and bundling its apps, restricting competition. NCLAT upheld some CCI findings but reduced the penalty from ₹936.44 crore to ₹216.69 crore and struck down some behavioral directions. The case raises fundamental questions about platform control, consumer choice, and market fairness. The outcome will set a precedent for digital market regulation in India and globally, influencing how hundreds of millions of Indians access mobile services.
- The Supreme Court will hear Google's appeal against an NCLAT judgment in an antitrust case.
- The CCI had accused Google of abusing its dominant position in Android through mandatory billing and app bundling.
- The NCLAT upheld some CCI findings but significantly reduced the penalty imposed on Google.
Negotiations for a legally binding global plastics treaty in Geneva are deadlocked between two blocs: the High Ambition Coalition (HAC) advocating for production cuts, and the Like Minded Countries (LMC) prioritizing waste management. The HAC, led by Norway and Rwanda, comprises nearly 80 countries, including the EU, arguing that pollution cannot be contained without capping plastic production. The LMC, including Iran, Saudi Arabia, Kuwait, Bahrain, China, and India, believes waste management is sufficient and production cuts would disrupt trade. The U.S., while not part of either coalition, also opposes production cuts. This rift reflects a shift in the plastics manufacturing industry towards South and Southeast Asia, with major refiners facing declining margins.
- Global plastics treaty negotiations are stalled due to a fundamental disagreement between two blocs.
- The High Ambition Coalition advocates for plastic production cuts to curb pollution.
- The Like Minded Countries, including India, prioritize waste management over production cuts, citing trade disruption concerns.
The Lok Sabha passed the revised Income Tax Bill, 2025, significantly broadening the powers of income tax officials. The Bill allows officials to forcibly break into personal emails and social media accounts of assessees during search operations, with the revised version containing 2.59 lakh words compared to 5.12 lakh words in the 1961 Act. Union Finance Minister Nirmala Sitharaman introduced the updated version. The Select Committee, which reviewed the bill, had suggested changes, but the final version still grants extensive powers, including accessing digital data and demanding passwords. Critics, like Congress MP Amar Singh, raised concerns about privacy violations and the potential for misuse of these broad powers, arguing it infringes on the right to privacy guaranteed by the Supreme Court.
- The Lok Sabha passed the revised Income Tax Bill, 2025, significantly expanding income tax officials' powers.
- New provisions allow officials to forcibly access personal emails and social media accounts during search operations.
- Concerns have been raised regarding potential privacy violations and misuse of these broad powers.