Daily News - Wednesday, 5 March 2025
PM Modi calls for manufacturing-led economic growth (mint)
Prime Minister Narendra Modi called India the “growth engine of the world” and urged the industry to drive a manufacturing revolution, emphasizing that government-led reforms over the past decade have ensured policy stability and a favorable investment climate. Highlighting the success of the Production-Linked Incentive (PLI) scheme, he noted that its 14 schemes have approved over 750 units, attracting ₹1.5 trillion in investment, generating ₹13 trillion in production, and contributing ₹5 trillion in exports. With global supply chains facing disruptions, Modi stressed that India has a unique opportunity to become a trusted global manufacturing hub and reaffirmed the government’s commitment to supporting the industry through business-friendly policies.
New model for investment treaties soon: CEA (Financial Express)
Chief Economic Adviser V. Anantha Nageswaran stated that India is formulating a new model Bilateral Investment Treaty (BIT) to align with the evolving global investment landscape while safeguarding the country’s sovereign rights and regulatory space. The revised BIT aims to offer stronger protections for investors, particularly in emerging markets, while ensuring that India’s public policy priorities are not constrained by international legal obligations, as highlighted in the Union Budget. With global economic growth facing pressure, Nageswaran emphasized the need for a modern, responsive regulatory framework to attract foreign direct investment (FDI), improve business operations, and sustain a “mood of constructive optimism” in India’s economy.
Govt steadfast on easing regulatory burden, says FM (Financial Express)
Finance Minister Nirmala Sitharaman emphasized that a robust manufacturing sector, free from unnecessary regulatory bottlenecks, will attract both domestic and foreign investments, enhancing India’s position as a global economic player. She highlighted the government’s efforts to improve ease of doing business by removing over 42,000 compliances and decriminalizing more than 3,700 legal provisions since 2014, with further simplifications planned under the Jan Vishwas Bill 2.0. To drive economic growth, the government has proposed a record capital expenditure of ₹15.48 lakh crore for 2025-26 (4.3% of GDP), including ₹11.21 lakh crore as core capex (3.1% of GDP), which is expected to create jobs, boost industries, and strengthen private sector participation.
Non-tariff barriers, red tape must go: USIBC (Business Standard)
As Commerce Minister Piyush Goyal and US counterpart Howard Lutnick began talks on a bilateral trade agreement, the US-India Business Council (USIBC) called for the removal of non-tariff barriers and red tape to enhance market access and boost GDP for both nations. With India currently accounting for only 2.5% of US trade volumes, USIBC stressed the need for a formalized trade framework that ensures open market access, swift dispute resolution, and predictable tax policies to drive investment and job creation. However, a Delhi-based think tank cautioned against a comprehensive Free Trade Agreement (FTA) with the US, citing past instances where the US unilaterally altered trade agreements, such as the replacement of NAFTA with USMCA and the imposition of 25% tariffs on Canada and Mexico despite existing trade commitments.
India faces limited gains, more pain from US-China trade war (Business Standard)
As the US-China trade war intensifies, Indian agricultural exporters may benefit primarily in cotton, as China’s retaliatory tariffs on US goods create potential supply gaps, while other commodities like soybeans and wheat remain restricted for export. In FY24, India exported $3.54 billion worth of agricultural goods to China and $5.52 billion to the US, but with China’s agricultural imports from the US dropping 14% to $29.25 billion, Beijing has increasingly turned to Brazil and domestic production to ensure food security. However, experts warn that surplus US agricultural products, such as maize and soybeans, could flood the Indian market, putting pressure on domestic farmers and increasing US demands for Indian imports.
