Daily News - Tuesday, 26 August 2025

Trump administration issues notice to India as 50% tariff deadline nears (Business Standard)

⁠The Trump administration has announced plans to impose steep 50% tariffs on Indian goods starting August 27, 2025, framing it as part of a broader push to pressure Moscow into ending the Ukraine war, even as India insists its Russian oil imports are essential for ensuring energy security for its 1.4 billion people. New Delhi has condemned the move as unfair and unjustified, pledging to protect its national interests while also quietly hoping that the ongoing peace talks Trump is trying to mediate between Putin and Zelenskyy might help avert the additional burden. With Putin showing little willingness to compromise, Trump has warned of “very big consequences” in the coming weeks, raising fears of more tariffs or sanctions on countries engaging with Russia, though so far, China and others have not been targeted.

⁠Odisha govt approves new IT, electronics component manufacturing policies (Business Standard)

The Odisha government has rolled out two major policies – one for electronics component manufacturing and another for IT – both aimed at attracting big investments, cutting down import dependence, and creating large-scale jobs, with benefits like heavy capital subsidies, tax breaks, and land support. The electronics policy matches central incentives and offers up to 50% subsidy for the first 10 large projects, special perks for mega investments over Rs 500 crore or 1,000 jobs, and even electricity duty waivers for a decade, while the IT Policy-2025 sets an ambitious goal of generating one million jobs in IT and ITeS with a basket of subsidies and reimbursements. These moves reflect Odisha’s push to build itself into a major investment hub for technology and electronics, while also approving routine appointments in the state’s Public Service Commission.

Airfares soar ahead of festive season (Financial Express)

Airfares for the festive season have shot up by 50–80% on busy routes like Mumbai–Delhi and Delhi–Kolkata, with one-way tickets now costing as high as Rs 9,500 to Rs 14,000, driven by strong demand, fewer available seats, and soaring jet fuel prices. Travel portals and agents point out that this Diwali long weekend is intensifying bookings, but unlike last year when excess capacity kept fares low, airlines are facing supply crunches due to delayed aircraft deliveries for both IndiGo and Air India. With aviation turbine fuel costs climbing to Rs 92,000 per kilolitre and capacity growth lagging, the sharp fare hikes highlight how demand is far outstripping supply, even as the government maintains that airlines are free to set fares under current rules. 

⁠‘Hopeful that negotiations will lead to minimal tariff impact’: RBI Governor (Financial Express)

RBI Governor Sanjay Malhotra acknowledged the US decision to raise tariffs on Indian goods to 50% effective August 27, noting that while growth projections have already been trimmed, he is hopeful that ongoing negotiations will help limit the overall economic impact, especially since nearly half of the sectors are outside the tariff net. He assured that the RBI is committed to supporting growth through ample liquidity, foreign exchange reserves of $695 billion covering 11 months of imports, and continued rate cuts of 100 basis points since February, while balancing the need for price stability. Malhotra also stressed reforms in governance and risk frameworks, unveiling plans for new credit risk guidelines and improved grievance redressal through ombudsman systems, emphasising that regulators and banks are ultimately working toward the same goals of stability and sustainable growth.

Rice stocks surge despite brisk open market sales (Financial Express)

India’s central rice stocks have ballooned to over 53 million tonnes—four times the required buffer—despite record offloading through open market sales, ethanol manufacturing, Bharat rice, and state welfare allocations, raising concerns about storage crunch when fresh procurement begins in October. The Food Corporation of India procures around 52–53 MT annually under MSP but supplies only 36–38 MT under welfare schemes like PMGKAY, leaving a surplus that drives up storage and subsidy costs, with the free ration scheme alone projected to cost Rs 11.8 trillion by 2028. Officials warn that unless stocks are reduced, the economic cost of rice will keep rising from its current Rs 41.73/kg, putting further pressure on the food subsidy bill already pegged at Rs 2.03 lakh crore this year.