Daily News - Friday, 11 April 2025

⁠India to speed up customs agreements to boost trade (mint)

⁠India is set to finalize Mutual Recognition Agreements (MRAs) with the customs authorities of Singapore, South Africa, and possibly the UK by June 2025 to streamline cross-border trade under the Authorized Economic Operator (AEO) programme, which offers benefits such as faster port clearance, lower inspection rates, and quicker tax refunds to accredited exporters and importers. These agreements aim to mutually recognize accreditation standards between India and partner countries, and India is also in talks with the EU for a similar arrangement post-FTA, while efforts to operationalize an MRA with the US continue, subject to compliance with additional IT security requirements. In 2023–24, India exported goods worth $14.4 billion to Singapore, nearly $13 billion to the UK, $77.5 billion to the US, and $35.6 billion to the UAE, and amid global trade uncertainty, the US has paused a 27% reciprocal tariff on India for 90 days, replacing it with a 10% rate, while imposing a 125% tariff on China. 

FM, UK Chancellor Reeves announce £400-million deals (Financial Express)

At the 13th UK-India Economic and Financial Dialogue in London, Finance Minister Nirmala Sitharaman and UK Chancellor Rachel Reeves announced £400 million (approx. $500 million) in new trade and investment deals, highlighting collaboration across sectors such as defence, financial services, education, and development. The leaders reaffirmed commitment to finalizing the long-pending India-UK Free Trade Agreement (FTA), with Sitharaman expressing optimism about overcoming remaining hurdles, citing a “great sense of positivity” and urgency from both sides. Following the UK visit, Sitharaman arrived in Austria for bilateral meetings with Austrian leaders and to co-chair a session with CEOs to promote deeper Indo-Austrian investment ties. 

Assam, Karnataka among states to steer economic recovery this fiscal (Financial Express)

According to India Ratings, states like Odisha, Assam, Tamil Nadu, and Karnataka led India’s economic recovery from FY20 to FY25 with a GSDP CAGR exceeding 6%, while Gujarat, Rajasthan, Andhra Pradesh, and others followed with 5–6% growth, contributing significantly to the national CAGR of 5.3%. Despite some large states like Maharashtra, Telangana, and Bihar posting slower recoveries (≤5% CAGR), the report highlights resilience across half of India’s states, driven by diverse growth engines—Odisha’s manufacturing share rose to 26.7% in FY24 (from 22.8% in FY20), aided by strong metals and petroleum output, while the services sector was dominant in states like Karnataka and Telangana. Subsectoral shifts also revealed growth in agriculture in UP and Bihar, while Uttarakhand, Maharashtra, and others saw a notable decline in manufacturing shares during the same period.

Moody’s cuts India growth forecast for 2025 to 6.1% (Financial Express)

⁠Moody’s Analytics has downgraded India’s 2025 GDP growth forecast from 6.4% to 6.1% due to the impact of stiff US tariff threats, particularly affecting key export sectors like gems, jewellery, textiles, and medical devices, though this revision preceded the recent 90-day pause on the 26% US reciprocal tariff. Despite external headwinds, Moody’s expects domestic growth to remain relatively resilient, supported by easing inflation and monetary policy adjustments, including the RBI’s 25 bps repo rate cut to 6%, with expectations of further reduction to 5.75% by year-end and a revised FY26 inflation forecast of 4%. RBI also shifted its policy stance to ‘accommodative’ and cut its FY26 GDP growth projection by 20 bps to 6.5%, signaling a proactive approach to mitigate global shocks and support domestic demand.

⁠Relief for seafood and rice exporters (Financial Express)

⁠India’s seafood exporters have gained significant relief as the US paused the 26% reciprocal tariff for 90 days and reduced it to 10%, bringing Indian exports, especially shrimp, on par with key competitors like Ecuador. The seafood export industry, which earned $2.55 billion from the US in FY24 (out of $7.38 billion total), relies heavily on frozen Vannamei shrimp, which constituted 92% of the shipments to the US, its largest market. Industry stakeholders fear that without a long-term bilateral trade agreement, future tariff hikes could again impact farmers and processors, especially as over 41% of India’s shrimp exports go to the US, while competing exporters like Vietnam and Indonesia still face tariffs of 46% and 32% respectively.