The India-U.K. Comprehensive Economic and Trade Agreement (CETA) is seen as a balanced "give and take" deal between two large economies. The U.K. offers duty-free access to 99% of its tariff lines but is conservative on professional movement. India has opened 90% of its tariff lines for duty-free import from the U.K., while protecting key agricultural products and phasing in duty reductions on automobiles. This deal is expected to boost FDI into India, especially due to local sourcing norms and duty-free export potential. It is also significant as it may set a template for India's future trade agreements with larger economies like the EU and the U.S.
- The India-U.K. CETA is characterized by mutual concessions, with the U.K. offering extensive duty-free access for goods and India opening up its market while protecting sensitive sectors.
- The agreement includes provisions for phased duty reductions on certain imports, like automobiles, allowing domestic industries time to adjust.
- CETA is expected to significantly boost Foreign Direct Investment (FDI) into India, driven by local sourcing norms and the potential for zero-duty exports to the U.K.
The India-U.K. Free Trade Agreement, while economically beneficial, poses significant public health risks for India. The deal's tariff-free entry for British High Fat, Sugar, and Salt (HFSS) food products could lead to lower prices, increased consumption, and a surge in diet-related diseases, mirroring Mexico's experience post-NAFTA. India's current regulatory framework for unhealthy foods is deemed sub-optimal, with weak enforcement of advertising restrictions and a preference for "star rating" front-of-pack nutrition labels over more effective warning labels. The article urges India to prioritize public health safeguards, including stricter advertising regulations and mandatory warning labels, to mitigate the adverse effects of cheaper junk food.
- The India-U.K. FTA, despite economic benefits, is criticized for potentially exacerbating public health issues in India by allowing cheaper HFSS food imports.
- The experience of Mexico post-NAFTA serves as a cautionary tale, where increased HFSS consumption led to a rise in diet-related diseases.
- India's existing regulations for unhealthy food advertising and labelling are considered inadequate compared to the UK's stricter norms.
India and the United Kingdom have signed a Comprehensive Economic Trade Agreement (CETA) and launched the 'India-U.K. Vision 2035' framework, replacing 'Roadmap 2030'. The deal aims to benefit Indian farmers, MSMEs, and various export sectors, while British products will face lower tariffs in India. UK Minister Reynolds hailed it as Britain's "biggest" trade deal since Brexit. Both nations emphasized the deal's political benefits and committed to strengthening multilateralism and reforming global bodies like the UN Security Council. They also agreed to negotiate a reciprocal Double Contributions Convention to prevent double social security payments for cross-border workers.
- India and the UK have formalized a Comprehensive Economic Trade Agreement (CETA) and established the 'India-U.K. Vision 2035' framework.
- The trade deal is projected to boost Indian exports in sectors like agriculture, MSME, footwear, and jewellery, while reducing tariffs on British goods in India.
- The Vision 2035 framework focuses on pillars such as growth, jobs, technology, climate, defence, and security, aiming for deeper bilateral cooperation.
The article draws parallels between the plastic and tobacco industries, arguing that both have used profit-driven tactics to influence policies and shift blame onto consumers. The plastic industry, backed by fossil fuel giants, has promoted recycling as a solution while privately acknowledging its impracticality, similar to how tobacco companies funded misleading science. This "greenwashing" creates a false impression of environmental responsibility. As regulations tighten in the Global North, plastic producers are increasingly targeting low- and middle-income countries with weaker environmental regulations. India's waste management relies heavily on the informal sector, and schemes like NAMASTE aim to integrate waste pickers while Plastic Waste Management Rules, 2016, mandate producer responsibility.
- The plastic industry employs tactics similar to the tobacco industry to influence green policies and deflect corporate accountability.
- "Greenwashing" and promoting impractical solutions like recycling are key strategies used by the plastic industry.
- Plastic producers are shifting focus to the Global South, where environmental regulations are weaker.
India's net Foreign Direct Investment (FDI) inflows plummeted by 98% to $35 million in May 2025, significantly lower than previous months. This sharp decline is attributed to both reduced gross FDI inflows and a substantial increase in repatriation and disinvestment by foreign firms. Gross FDI stood at $7.2 billion, an 11% decrease from May 2024. Simultaneously, repatriations and disinvestments by foreign companies surged to $5 billion, a 24% increase from a year ago. Outward FDI by Indian firms also increased by 18.5% year-on-year to $2.1 billion, further contributing to the lower net figure, according to data from the Reserve Bank of India.
- Net FDI inflows into India experienced a drastic 98% decline in May 2025.
- The reduction is a result of both lower gross FDI inflows and increased outflows due to repatriation and disinvestment.
- Foreign companies significantly increased their repatriation and disinvestment activities compared to the previous year.
A trade deal between India and the U.S. continues to face a deadlock as the August 1 deadline approaches, primarily due to disagreements over agriculture and automotive components. India is firm on protecting its domestic farmers by resisting the opening of its agriculture sector to imports, while the U.S. is keen on this, viewing it as a precedent for future deals with the EU and Japan. Another key hurdle is the U.S.'s reluctance to reduce import duties on automotive components. Officials anticipate a potential last-minute surprise announcement from President Trump, similar to past deals with Indonesia and Vietnam, even as India aims for a broader Bilateral Trade Agreement later this year.
- The India-U.S. trade deal remains stalled primarily due to disagreements on agriculture and automotive components.
- India is resisting opening its agriculture sector to protect domestic farmers.
- The U.S. is reluctant to reduce import duties on automotive components.
Tamil Nadu has achieved the second position in the country for per capita Net State Domestic Product (NSDP), according to figures released by the Union Ministry of Statistics and Programme Implementation. The State's per capita NSDP stood at ₹1,96,309, significantly higher than the national per capita net national income (NNI) of ₹1,14,710 at constant prices for 2024-25. The Tamil Nadu government attributes this achievement to its efficient administration and visionary welfare programmes implemented since 2021, despite not receiving new welfare programmes or sufficient funds from the Union government.
- Tamil Nadu secured the second rank nationally in terms of per capita Net State Domestic Product (NSDP).
- The achievement is based on figures published by the Union Ministry of Statistics and Programme Implementation.
- The State's government credits efficient administration and welfare programs for this economic milestone.
As the UK and India move towards a Free Trade Agreement (FTA), Global Capability Centres (GCCs) are emerging as a key area for collaboration. India, already home to over 1,500 GCCs employing 1.9 million people, is seen by British companies not just as a cost-effective back office but as a strategic partner for R&D and digital transformation. The FTA is expected to facilitate deeper engagement by easing regulatory barriers, streamlining professional movement, and harmonizing digital and data governance. From the UK's perspective, the FTA offers access to a fast-growing digital economy, while for India, it aligns with digital economy ambitions and becoming a global hub for high-value services.
- The UK-India Free Trade Agreement (FTA) is poised to significantly enhance collaboration in Global Capability Centres (GCCs).
- India is a leading hub for GCCs, contributing to global innovation and digital transformation.
- The FTA aims to ease regulatory barriers, facilitate talent mobility, and harmonize digital standards.
A recent World Bank report, "India Poverty and Equity Brief: April 2025," asserts that India has almost eradicated extreme poverty and significantly reduced consumption inequality since 2011-12. Based on the Household Consumption Expenditure Survey (HCES) data for 2022-23, the consumption-based Gini coefficient reportedly dropped from 28.8 to 25.5. The report also highlights improvements in dietary intake for lower-income groups and welfare transfers. However, the author argues that while consumption inequality has decreased, income inequality remains a concern. Critiques are raised against income inequality estimates, particularly those from the World Inequality Lab (WIL), for using pre-tax income and making unrealistic assumptions about consumption exceeding income for many households, suggesting post-tax and post-subsidy analysis would show a decrease in income inequality.
- The World Bank report claims India has significantly reduced consumption inequality and almost eradicated extreme poverty.
- The consumption-based Gini coefficient decreased from 28.8 to 25.5 between 2011-12 and 2022-23.
- Improvements in dietary intake and welfare transfers for the poor are noted in the report.
The Union Cabinet has approved the Prime Minister Dhan-Dhaanya Krishi Yojana (PMDDKY), a new umbrella scheme to be implemented through the convergence of 36 existing schemes across 11 departments. It aims to address productivity disparities among states and districts, subsuming key central schemes like PM-KISAN and PMFBY. With an annual outlay of ₹24,000 crore for six years, the scheme will identify 100 low-productivity districts. While promoting national uniformity and local partnerships, the article highlights a concern: the continuous decline in public spending on agriculture, which has fallen from 3.53% in 2021-22 to 2.51% in 2025-26 as a percentage of total Central Plan outlay. The scheme will operate based on 'District Plans' aligned with national goals.
- The PMDDKY is a new umbrella scheme converging 36 existing agricultural schemes across 11 departments.
- It aims to address productivity disparities and will subsume schemes like PM-KISAN and PMFBY.
- The scheme has an annual outlay of ₹24,000 crore for six years and targets 100 low-productivity districts.
The European Union has sanctioned a Gujarat-based refinery owned by Nayara Energy Ltd., which has a 49.13% stake held by Russia's Rosneft. This action is part of a new sanctions package aimed at Russia's energy sector to weaken its ability to wage war in Ukraine. The EU also announced a lowering of the oil price cap for Russian crude from $60 to $47.6 per barrel for countries utilizing G7 shipping and insurance services. Additionally, the sanctions include an EU-wide import ban on refined petroleum products made from Russian crude oil and a full transaction ban on the Nord Stream 1 and 2 natural gas pipelines.
- The EU sanctioned Nayara Energy Ltd.'s Gujarat refinery due to its significant Russian ownership by Rosneft.
- The new sanctions package targets Russia's energy sector to diminish its capacity for war in Ukraine.
- The oil price cap for Russian crude was reduced from $60 to $47.6 per barrel for G7-insured shipments.
The Ministry of Commerce, through its departments like DGFT and DGTR, is actively monitoring and clamping down on import surges and dumping practices by India's trading partners. This initiative aims to protect the domestic sector from unfair trade practices. The Directorate General of Trade Remedies (DGTR) recently initiated anti-dumping investigations on eight product lines from 12 countries/groupings, targeting industrial chemicals and glass wool, among others. The Directorate General of Foreign Trade (DGFT) also restricted imports of palladium, rhodium, and iridium alloys (containing >1% gold) to prevent evasion of higher import duties on gold, which was being disguised as these free-import alloys.
- The Ministry of Commerce is actively monitoring and restricting import surges and dumping to safeguard India's domestic industries.
- The Directorate General of Trade Remedies (DGTR) has initiated anti-dumping investigations on eight product lines from 12 countries or groupings.
- Dumping refers to exporting goods at prices below their normal rate, harming domestic producers.
Global shipping aims for decarbonisation by 2040-50, presenting a significant opportunity for India. The industry is transitioning from traditional fuels like Very Low Sulphur Fuel Oil (VLSFO) and LNG to green alternatives such as green ammonia and e-methanol. Green hydrogen, produced via renewable energy, is foundational, with green ammonia being preferred for its stability in shipping. India is encouraged to become a marine green fuels production hub, leveraging its solar energy revolution and policy frameworks. Challenges include high upfront capital costs, price discrepancies, and reliance on imports for key technologies. The article suggests innovative financial instruments, PLI schemes, CCUS incentives, and demand-side support for green shipbuilding to achieve this goal.
- Global shipping is committed to decarbonisation by 2040-50, transitioning from traditional fuels to green alternatives like green ammonia and e-methanol.
- Green hydrogen, derived from renewable power, is the key enabler, with green ammonia being a more stable and practical fuel for shipping than hydrogen itself.
- India has a significant opportunity to establish itself as a global hub for marine green fuel production, building on its successful solar energy revolution.
The article contends that the U.S., particularly under Donald Trump, has marginalized the UN and multilateralism, favoring bilateral deals that fragment the global order. It suggests India must accept this shift and focus on national prosperity and South-South cooperation. India needs to define 'strategic autonomy' and prioritize its core interests, looking East for ideas and trade agreements rather than West. The author highlights India's intrinsic strengths in the fourth industrial revolution and defense, advocating for a growth-focused approach, revisiting border issues, and leveraging opportunities like the BRICS Summit in 2026 to lead the Global South in fostering shared prosperity through reoriented tariffs and value chains.
- The U.S. is shifting away from multilateralism towards bilateral deals, leading to a fragmentation of the global order.
- India should adapt by focusing on national prosperity, South-South cooperation, and clearly defining its 'strategic autonomy'.
- India's foreign policy should prioritize trade agreements with Eastern nations (e.g., ASEAN) and leverage its strengths in technology and defense.
India's headline inflation fell to a 77-month low of 2.1% in June 2025, primarily due to a seasonal easing in food inflation. However, the article highlights that other essential items like education, healthcare, and personal care saw significant price increases, with personal care inflation reaching 14.8%. It questions whether the Consumer Price Index (CPI), with food carrying a 46% weight, accurately reflects the average Indian's experience, as household surveys show food comprises only about 30% of expenditure. The author calls for updating the CPI base year (currently 2011-12) and revising category weights for a more representative measure.
- India's headline inflation reached a 77-month low of 2.1% in June 2025, largely driven by a seasonal fall in food prices.
- Despite easing food inflation, other essential sectors like education, healthcare, and personal care experienced significant price increases.
- The article points out a discrepancy between the CPI's 46% weight for food and the actual household expenditure on food, which is around 30%.
India's industrial production and corporate investment are struggling, with the Index of Industrial Production (IIP) slowing to a nine-month low of 1.2%. Despite government efforts like corporate tax cuts, increased capital expenditure, and interest rate reductions, private sector Gross Fixed Capital Formation (GFCF) in machinery and equipment has grown only 35% in four years. The article argues that investment primarily depends on demand for goods, not just profitability or finance. It highlights that in a capitalist economy, individual firms invest based on perceived demand, and collective investment to revive a slowdown is anathema to capitalism. Exogenous stimuli, particularly government expenditure, are crucial to kickstart demand and the investment cycle.
- India's industrial production and corporate investment are lagging, with IIP at a nine-month low of 1.2%.
- Despite government incentives like corporate tax cuts and increased capital expenditure, private sector GFCF remains low.
- The article posits that investment is primarily driven by demand for goods, not merely by profitability or access to finance.
Nearly four years after its introduction, the Centre has discovered widespread manipulation of the National Mobile Monitoring System (NMMS) for MGNREGS digital attendance, undermining its credibility and leading to potential misuse of public funds. Issues identified include uploading irrelevant photos, "photo-to-photo capturing" instead of live images, mismatches in actual vs. recorded counts, and discrepancies in gender composition and morning/afternoon photos. To plug these gaps, the Ministry of Rural Development has added four layers of analog monitoring and directed states to ensure 100% verification at gram panchayat level, with reduced percentages at block, district, and state levels.
- The National Mobile Monitoring System (NMMS) for MGNREGS digital attendance is being widely manipulated, leading to misuse of public funds.
- Identified issues include uploading irrelevant photos, "photo-to-photo capturing," and mismatches in worker counts and photos.
- The NMMS requires geo-tagged photographs of workers twice a day, with an exception for sites with 20 or fewer workers.
India faces a paradox where 43% of STEM graduates are women, the highest globally, yet women constitute only 27% of the STEM workforce. This education-employment gap, driven by persistent social norms and unwelcoming workplaces, limits women's access to career opportunities. The article highlights that enabling more women in the workforce could significantly boost India's GDP. Government policies like NEP 2020 and increased gender budget allocation aim to improve women's economic mobility. However, industry must transition from passive recruiters to active enablers, addressing stereotypes and providing supportive environments, as exemplified by initiatives like UN Women's WeSTEM programme.
- India has the highest proportion of women STEM graduates globally (43%), but only 27% are in the STEM workforce.
- This significant education-employment gap is attributed to social norms, workplace environments, and lack of awareness about career opportunities.
- Increasing women's participation in the workforce could substantially boost India's GDP, with estimates up to $700 billion by 2025.
The article argues for a stronger India-Europe relationship, rooted in shared values and strategic compulsions, to foster a multipolar, stable, and equitable world amidst global disorder. Both India and Europe, as aspirational middle powers, are expanding dialogue in trade, technology, security, and climate change. Economic ties are growing, with EU FDI in India increasing by 70% between 2015-2022. The article emphasizes fast-tracking trade agreements, reinterpreting the Carbon Border Adjustment Mechanism, and leveraging the India-Middle East-Europe Economic Corridor (IMEC). It also highlights cooperation in digital architecture, clean energy, biotechnology, and defense, stressing the need for human mobility and political will to address issues like terrorism.
- India and Europe are urged to strengthen their partnership as aspirational middle powers to promote a multipolar world order.
- Bilateral engagement is expanding across trade, technology, security, and climate change, with significant growth in EU FDI in India.
- Fast-tracking India-EU Trade and Investment Agreements and reinterpreting the Carbon Border Adjustment Mechanism are crucial.
Canada is seeking new economic partners after the U.S. imposed a 35% tariff on Canadian imports, despite Ottawa rescinding a digital services tax. This move by the U.S., driven by a trade surplus in Canada's favour, has forced Canada to diversify its foreign and economic policy, similar to how Nepal recalibrated its strategy after India closed land ports a decade ago. Nepal's reliance on Indian ports and subsequent economic collapse led it to join China's Belt and Road Initiative, much to India's dismay. The article suggests the U.S. should learn from this history, as losing a close ally like Canada over trade imbalances could have significant repercussions.
- The U.S. imposed a 35% tariff on Canadian imports, despite Canada rescinding its digital services tax.
- This U.S. action, driven by a trade surplus in Canada's favor, has prompted Canada to seek new economic partners.
- The situation is compared to India's blockade of Nepal a decade ago, which forced Nepal to align with China.
Retail inflation in India eased to a 77-month low of 2.1% in June, down from 2.82% in May, primarily driven by falling food prices for the eighth consecutive month. Wholesale inflation also contracted after 20 months, with crude oil prices further contributing to the decline. The Consumer Price Index (CPI) showed the food and beverages category contracted by 0.2% in June, a significant drop from 8.4% in June 2024. Key items like vegetables, pulses, spices, and meat experienced deflation. This trend is expected to continue, supported by healthy agricultural activity and a favourable base.
- Retail inflation reached a 77-month low of 2.1% in June, primarily due to easing food prices.
- Wholesale Price Index (WPI) also contracted after 20 months, influenced by falling food and crude oil prices.
- The food and beverages category within CPI saw a contraction of 0.2% in June, marking the eighth consecutive month of easing food inflation.
The 17th BRICS Summit in Rio de Janeiro highlighted the bloc's role as a voice for the Global South, aiming to transform a Western-dominated world order through South-South cooperation. BRICS, now an intergovernmental organization, comprises 35% of the global economy and nearly half the world's population, surpassing the G7. It seeks to foster economic, political, and social cooperation, advocating for greater representation in global governance and reducing reliance on the U.S. dollar. Despite its potential, the bloc faces challenges from internal divisions, differing national priorities, and external pressures from Western powers, including threats of tariffs. India's role as a bridge-builder is complicated by border tensions with China.
- BRICS serves as a significant institutional expression of Global South aspirations, aiming to challenge Western hegemony and promote South-South cooperation.
- The bloc has grown to represent 35% of the global economy and nearly half the world's population, surpassing the G7's economic share.
- Key objectives include fostering economic, political, and social cooperation, advocating for global governance reforms, and reducing reliance on the U.S. dollar.
A recent World Bank report suggesting low and falling consumption inequality in India has sparked debate, with commentators arguing it doesn't reflect the true picture of income and wealth disparities. While consumption inequality may be lower, income and wealth inequality in India are extremely high and have increased over time. Researchers from the World Inequality Database (WID) indicate India's Gini coefficient for pre-tax income in 2022-23 was 0.61, making it one of the most unequal economies globally. For wealth, the Gini coefficient was 0.75, with the top 1% of adults controlling almost 40% of net personal wealth, highlighting extreme concentration.
- The World Bank's assessment of low consumption inequality in India is contested by experts who point to high income and wealth disparities.
- Consumption inequality is inherently lower than income or wealth inequality because poorer households spend most income, while richer ones save more.
- Data from Household Consumption Expenditure Surveys (HCES) may under-estimate inequality by failing to capture extremely high incomes.
Catastrophe bonds (cat bonds) are hybrid insurance-cum-debt financial products that transfer hazard risk from at-risk states to global financial markets through securitization. This mechanism provides a larger pool of funds for post-disaster relief and reconstruction, offering quicker payouts and reduced counter-party risk. Governments sponsor these bonds, paying premiums, with the principal at risk for investors if a disaster occurs. While profitable for investors seeking diversification, India could benefit from sponsoring a South Asian cat bond to ring-fence public finances against increasing extreme weather events. However, defectively designed cat bonds might not pay out despite significant disasters, emphasizing the need for transparent government procedures.
- Catastrophe bonds (cat bonds) are financial instruments that convert insurance risk into tradable securities, transferring disaster risk to global financial markets.
- They offer a mechanism for quicker payouts and reduced counter-party risk for post-disaster relief and reconstruction.
- Governments act as sponsors, paying premiums, while investors risk their principal if a specified disaster occurs, making them attractive for diversification.