Daily News - Tuesday, 12 May 2026
India’s Forex Reserves Dip to USD $690.7 Billion. How India Earns And Spends Foreign Exchange (News18)
India’s foreign exchange reserves stood at USD $690.7 billion (INR ₹57.4 lakh crore) as of May 1, 2026, down from the all time high of USD $728.5 billion (INR ₹60.6 lakh crore) in late February, according to the Reserve Bank of India (RBI). The decline was driven by costlier crude oil imports and a weaker rupee amid the West Asia conflict, with reserves falling USD $4.82 billion in the previous week alone. Foreign currency assets, the largest component, dropped USD $2.797 billion to USD $551.8 billion (INR ₹45.8 lakh crore), while gold reserves fell USD $5.021 billion to USD $115.2 billion (INR ₹9.6 lakh crore). In contrast, Special Drawing Rights (SDRs) rose slightly to USD $18.8 billion (INR ₹1.56 lakh crore) and India’s IMF reserve position increased to USD $4.86 billion (INR ₹404 billion). India earns forex mainly through exports of goods and services, IT/software exports, remittances (USD $138 billion in 2024 / INR ₹11.5 lakh crore), FDI, and FIIs, while spends are dominated by crude oil, gold, electronics, machinery, fertilizers, and overseas education/travel. The Finance Ministry and RBI use reserves to stabilize the rupee, meet import requirements, and buffer against global volatility, ensuring confidence in India’s external sector.
India Seeks Pharma, Agriculture, Defence Market Access in ASEAN (Business Standard)
India is prioritizing the review of the ASEAN-India Trade in Goods Agreement (AITIGA), with the Ministry of External Affairs (MEA) pushing for early conclusion to address trade imbalances. Current trade with ASEAN stands at USD $123 billion (INR ₹10.2 lakh crore), with imports at USD $84 billion and exports only USD $39 billion, highlighting the asymmetry. Prashant Agrawal, Additional Secretary (South), MEA, emphasized that India is negotiating bilaterally for better access in pharmaceuticals, agriculture, and defence exports, citing India’s 45% share of Vietnam’s pharma imports. India is also planning to export 200 containers of grapes to Vietnam, alongside agreements on rare earth minerals cooperation. Defence exports such as night vision devices and bulletproof vests are rising, while Japan, Singapore, and South Korea remain major investors in India despite geopolitical turbulence. Experts at the panel discussion stressed that the AITIGA review should simplify rules of origin, tackle non-tariff barriers, and integrate India more deeply into Asian value chains, supporting MSMEs and resilient supply chains.
Toyota to Build New India Plant in Maharashtra, Production by 2029 (Fortune India)
Toyota Kirloskar Motor (TKM) announced plans to set up a greenfield vehicle manufacturing facility in Bidkin Industrial Area, Maharashtra, scheduled to begin production in the first half of 2029. The new plant will supplement Toyota’s existing Bidadi, Karnataka operations, which currently have a combined installed capacity of 342,000 units annually. In FY26, Toyota reported 406,081 units sold, a 20% year‑on‑year growth, with domestic sales rising 19% to 367,000 units and exports surging 41%, driven by SUVs and MPVs like the Innova HyCross, Fortuner, and Urban Cruiser Hyryder. The Maharashtra facility is aimed at strengthening Toyota’s business foundation in India while serving customers in surrounding regions through exports. Analysts highlight India’s growing role in Toyota’s global network, with rising demand for utility vehicles and India’s emergence as an export hub prompting capacity expansion. Toyota currently employs 6,400 people in India, manufacturing models such as the Innova HyCross, Fortuner, Legender, Camry Hybrid, and Hilux, alongside alliance products like the Glanza and Rumion.
India and Peru to Resume FTA Talks in June 2026 (Reuters)
India and Peru are set to resume free trade agreement (FTA) negotiations in June 2026, with both sides aiming to sign the deal by year‑end, according to Peru’s Ambassador to India Javier Paulinich. Peru, the world’s third-largest copper producer, is negotiating a critical minerals chapter with India, reflecting India’s push to secure supply chains. India’s Ministry of Commerce and Industry has not yet commented, but Hindalco Industries is reportedly exploring copper purchase agreements with Peru. Peru produced 2.7 million metric tons of copper in 2024, attracting USD $4.96 billion (INR ₹413 billion) in foreign investment. India, the second-largest importer of refined copper, may need to source 91-97% of copper concentrate requirements from overseas by 2047, with demand projected to rise from 1.2 million tons in FY25 to 8.9-9.8 million tons by 2047. The talks highlight India’s broader strategy of encouraging mining companies to invest abroad to mitigate supply risks and support industrial growth.
