Daily News - Thursday, 14 August 2025

Beijing doors ajar for trade package delivery (The Economic Times)

India and China are preparing to open talks later this month, likely coinciding with Prime Minister Modi’s visit to the SCO summit in Tianjin, on a trade package covering critical rare earth magnets, fertilisers, and pharmaceuticals—signalling a potential easing of tensions after years of strained ties, border skirmishes, and trade restrictions, and amid India’s need to secure essential imports in the face of US tariff pressures. Rare earth magnets, vital for electric vehicles, remain blocked for Indian buyers despite China resuming shipments to other regions, while urea imports are being cautiously revived through state tenders, though specialty fertilisers—of which India sources 80% from China—are still restricted; pharmaceuticals are also on the agenda, with both countries wary of looming imbalances and the potential fallout from a proposed US 250% tariff on finished drugs. Officials and industry leaders suggest the talks could help mitigate supply vulnerabilities and diversify risk at a time when India’s exporters are grappling with a 50% US tariff and shifting global trade alignments.

⁠RBI likely spent $6B offshore in two weeks to boost Rupee (The Economic Times)

⁠India’s forex reserves have fallen sharply—by $9.3 billion in the week to August 1—in what market participants estimate as $5–$6 billion worth of Reserve Bank of India interventions in the offshore non-deliverable forwards (NDF) market and onshore spot trades over the past fortnight, aimed at curbing sharp rupee depreciation and volatility that recently pushed the currency near its record low. Treasury officials point to early-morning NDF dollar sales around 9 am that helped the rupee open stronger in Mumbai, with the RBI stepping in more actively than in previous months to smooth movements and prevent imported inflation risks, after a period of minimal intervention since Governor Sanjay Malhotra took charge in December 2024. The rupee, which has weakened 2.4% this year from 85.61 to 87.71 per US dollar, faces continued pressure from global market factors, with experts expecting further reserve declines this week alongside a likely rise in short forward positions. 

⁠India eyes nuclear power expansion, to allow uranium mining: Report (Financial Express)

India is preparing a landmark policy shift to let private companies mine, import, and process uranium—activities currently monopolized by the state—in an effort to draw billions in investment, meet rising nuclear fuel demand, and lift nuclear power’s share to 5% of total electricity, while still retaining government control over spent fuel reprocessing and plutonium waste management. The plan, expected to be unveiled this fiscal year, could also allow foreign firms to take minority stakes in nuclear plants and supply critical control system equipment, a move seen as vital to achieving Prime Minister Modi’s goal of expanding nuclear capacity twelvefold by 2047, given that domestic uranium reserves of 76,000 tonnes would meet only a quarter of the projected demand. Experts call the reform bold and overdue, noting it mirrors policies in countries like Canada and the US, and would require importing the bulk of fuel needed to power the expansion, marking a significant opening of one of India’s most tightly controlled energy sectors. 

US begins probe against Indian solar imports (Financial Express)

The US Department of Commerce has launched an anti-dumping and subsidy investigation into Indian solar PV cell and module exports—part of a broader probe also targeting Indonesia and Laos—after a petition from the Alliance for American Solar Manufacturing and Trade, raising concerns among brokerages that the move could hurt India’s 8% share of US solar imports in 2024 and disrupt demand driven by tax credit deadlines under the Big Beautiful Bill. Shares of major exporters like Waaree Energies and Premier Energies dropped up to 5% following the news, though company executives stressed that their pricing is transparent and compliant, with Waaree highlighting that 57% of its order book is US-focused, ongoing US capacity expansion to offset tariffs, and Premier noting that over 99% of its orders are domestic and thus largely shielded from the fallout. Industry voices such as Vikram Solar’s chairman see minimal sector-wide impact given India’s relatively small export volumes, but acknowledge that for firms heavily exposed to the US, the investigation adds to existing tariff pressures and could influence near-term export momentum.

US tariff impact to ease out in one to two quarters: CEA (Financial Express)

India’s chief economic advisor Anantha Nageswaran said the current strain from the US’s 50% additional tariff—driven by a second 25% levy linked to Russian oil imports taking effect on August 27—should ease within one to two quarters, with only limited long-term impact, though in the short term exporters will feel the pinch as trade talks with Washington continue alongside a potentially pivotal Trump–Putin meeting on August 15. He noted that despite these tariffs, India’s economic momentum remains intact, supported by robust domestic demand and services activity, though headwinds like slow credit growth, weak private investment, and tariff uncertainty could temper acceleration; forecasts from S&P, ICRA, and the RBI peg FY26 GDP growth at 6.2–6.5%, but analysts warn this could be cut by 40–100 basis points if the tariff remains for the year. While emphasising ongoing engagement with affected exporters, Nageswaran urged that trade frictions not distract from bigger strategic challenges—such as AI adoption, semiconductor competitiveness, energy transition, and security—where India must invest heavily to compete with the US and China.