India's IREDA files insolvency application against Gensol Engineering
May 14 (Reuters) - Indian Renewable Energy Development (INAR.NS), opens new tab agency has filed an insolvency application against the embattled Gensol Engineering (GENO.NS), opens new tab, it said on Wednesday, adding that the default amount is 5.10 billion rupees ($59.73 million).
($1 = 85.3840 Indian rupees)
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Reuters
19 minutes ago
- Reuters
Exclusive: Shein and Reliance aim to sell India-made clothes abroad within a year, sources say
MUMBAI/LONDON, June 9 (Reuters) - Fashion retailer Shein and partner Reliance Retail plan to rapidly expand their Indian supplier base and start overseas sales of India-made Shein-branded clothes within six to 12 months, said two people with knowledge of the matter. The China-founded, Singapore-headquartered e-commerce firm has been discussing plans with the Indian retailer since before the U.S. imposed tariffs on Chinese imports that intensified the need to diversify sourcing, the people said. The aim is to raise Indian suppliers to 1,000 from 150 within a year, they said. In a statement to Reuters, Shein said it licensed its brand for use in India. Reliance did not respond to queries. Shein sells low-priced apparel such as $5 dresses and $10 jeans shipped directly from 7,000 suppliers in China to customers in around 150 countries. Its biggest market is the U.S. where it is adjusting to tariffs on low-value e-commerce packages from China which were previously imported duty free. The retailer launched in India in 2018 but its app was banned in 2020 as part of government action against China-linked firms amid border tension with its northeastern neighbour. It returned in February under a licensing deal with the Reliance Industries ( opens new tab unit which launched selling Shein-branded clothes produced in local factories. In contrast, Shein's other websites mainly list goods from China. Reliance, controlled by Asia's richest person, Mukesh Ambani, has contracted 150 garment manufacturers and is in discussion with 400 more, said the two people, declining to be identified due to confidentiality concerns. The goal is 1,000 Indian factories making Shein-branded clothes within a year for both the Indian market and to service some of Shein's global websites, the people said. Shein initially wants to list India-made clothes on its U.S. and British websites, one of the people said. Discussions have been ongoing for months and the launch time of six to 12 months could change depending on supplier numbers, the person said. The scale of supplier expansion and export time frame is reported here for the first time. Shein has licensed its brand for domestic use to Reliance which "is responsible for manufacturing, supply chain, sales and operations in the Indian market," Shein said in a statement. In December, Minister of Commerce and Industry Piyush Goyal told parliament that the Shein-Reliance partnership aimed to create a network of Indian suppliers of Shein-branded clothes for sale "domestically and globally". Shein is a fast-fashion behemoth earning annual revenue of over $30 billion through low prices and aggressive marketing. Most of its products are from China with some made in countries such as Turkey and Brazil. Its expansion in India mirrors interest in the country from the likes of Walmart (WMT.N), opens new tab and others throughout the global fashion and retail industries, particularly those looking for suppliers outside China due to the Sino-U.S. trade war. The Shein India app has been downloaded 2.7 million times across Apple and Google Play stores, averaging 120% on-month growth, showed data from market intelligence firm Sensor Tower. Offerings during its first four months have reached 12,000 designs, a fraction of the 600,000 products on its U.S. site. In the women's dresses category, its cheapest item is priced 349 Indian rupees ($4) versus $3.39 on the U.S. site as of June 9. Shein's Indian partner Reliance, which operates the app, is working with suppliers to assess whether they can replicate Shein's global best-sellers at lower cost, the two people said. Reliance aims to emulate Shein's on-demand manufacturing model, asking suppliers to make as few as 100 pieces per design before increasing production of those that sell well, they said. Executives from Reliance recently visited China to understand Shein's "innovative" supply chain operations, "data driven" design processes and "disruptive" digital marketing, Manish Aziz, assistant vice president Shein India at Reliance Retail, said in a LinkedIn post in which he called Shein's scale and speed "truly incredible". The partnership is one of dozens Reliance has with fashion brands, such as Brooks Brothers and Marks and Spencer (MKS.L), opens new tab. The firm also runs e-commerce site Ajio and its retail network competes with Amazon (AMZN.O), opens new tab and Walmart's Flipkart as well as value retailers such as Tata's Zudio. Reliance plans to work with new suppliers to source fabric - especially fabric made using synthetic fibres where India lacks expertise - and import required machinery, the people said. The firm will invest in suppliers and help them grow which in turn will help the Shein-Reliance partnership go global, they said.
Reuters
25 minutes ago
- Reuters
India central bank's large rate cut squeezes forward premiums, leaves rupee vulnerable, analysts say
MUMBAI, June 9 (Reuters) - The Reserve Bank of India's surprise outsized rate cut last week will leave the rupee vulnerable to further depreciation by pressuring already depressed foreign exchange forward premiums, several analysts said on Monday. The rupee has underperformed its Asian peers in 2025 amid weak capital flows. A narrowing interest rate differential — with the U.S. Federal Reserve moving slower than the RBI in cutting rates — suggests the Indian currency may continue to lag. The 1-month U.S. dollar/rupee forward premium — typically more sensitive to liquidity conditions — fell to 7.5 paisa, its lowest level since November. Meanwhile, the 1-year premium , which is more responsive to rate differential between the U.S. and India, declined to 1.5250 rupees, marking its lowest level in nearly a year. GRAPHIC: A drop in dollar/rupee forward premiums makes the rupee less attractive for carry trades, and diminishes the incentive for exporters to hedge future receivables. At the same time, it raises the likelihood that importers—who typically hedge near-term payment obligations—will step up their hedging activity. The decline in premiums - a less favourable rate differential between the U.S. and India - could leave the rupee open to sharper depreciation. Against the backdrop of benign inflation and the need to support growth, the Reserve Bank of India last Friday delivered a larger-than-expected 50 basis point rate (bps) cut, exceeding the 25 bps anticipated by economists. In a further easing move, the central bank slashed the cash reserve ratio for banks. "One thing the rupee had going for it is that it offered attractive carry ... with the 50-bps rate cut from the RBI, carry attraction has been reduced," Mitul Kotecha, head of FX and EM macro strategy Asia at Barclays, adding that in an environment where investors are again focussed on carry, the rupee's appeal has been diminished. Falling premiums can be a "mild added headwind" for the rupee amid globally elevated yields, Dhiraj Nim, FX strategist at ANZ Research, said, and pointed out that if India growth data weaken, there could be scope for one more rate cut.
Reuters
40 minutes ago
- Reuters
The path to cheap power will be very expensive
LONDON, June 9 - Europe's ambition to develop cheap, clean energy has recently received a harsh reality check, as power failures and a string of cancelled renewables projects made it clear that the road to inexpensive power will carry a very high price tag. European investments in renewable energy have risen sharply over the past decade as governments have begun implementing policies to reduce greenhouse gas emissions – an effort that sped up after Russia's invasion of Ukraine created an energy price shock. The share of renewables in the EU's power sector rose to 47% in 2024 from 34% in 2019, with a record 168 gigawatts (GW) of solar and 44 GW of wind power capacities installed between 2022 and 2024 alone, according to EU data. In Britain, renewable generation exceeded 50% for the first time in 2024, data showed. But investment in grid infrastructure, including pylons, cables, transformers and battery storage technology, has barely kept up with the rapid change in the power generation mix. Between 40% and 55% of low-voltage lines will exceed the age of 40 by 2030, while their length increased only by 0.8% between 2021 and 2022, according to a European Commission report. The Commission last week issued guidance for developing electricity networks in which it estimated the bloc will require 730 billion euro of investments in power distribution and another 477 billion euro in transmission grid developments by 2040. The underinvestment in grid infrastructure has created strain in many systems, a risk that was laid bare on April 28, with the catastrophic blackout in the Iberian Peninsula. Regulators are still investigating exactly what triggered the collapse of the power systems in Spain and Portugal. But what is known for sure is that the outage was preceded by the disconnection of two solar farms in southern Spain. The Spanish system is heavily reliant on renewables, but the issue was not the energy source itself. Rather, the problem was that the grid system had not been updated to account for the fact that solar-powered plants, unlike those using fossil fuels, do not generate inertia – the kinetic energy created by the rotation of spinning generators – which can help stabilize a grid in the event of power disturbances. To overcome this challenge, operators would need to invest in technologies such as synchronous condensers or batteries that kick in within milliseconds in the event of an outage to offer backup. The Iberian debacle puts a spotlight on the fact that more investment is needed in the mundane, but vital, elements of grid infrastructure. Another reality check for Europe has been the realization that offshore wind – once heralded as a potential renewables game changer – simply has lousy economics today. Danish offshore wind giant Orsted on May 7 cancelled a major project off the eastern coast of Britain, Hornsey 4, dealing a blow to the country's ambitions to develop 50 GW of clean power capacity by 2050. The recent rise in material costs forced the cancellation, according to Orsted, which had already sunk 5.5 billion Danish crowns ($840.5 million) into the project. And then on May 16, the Dutch government postponed tenders for two offshore wind farms with a total capacity of 2 GW due to a lack of interest from potential bidders. Several companies said they saw no viable business case for the projects, which offered developers no government subsidies. These two cases suggest that capital-intensive projects like offshore wind simply won't make economic sense without more ambitious government policy initiatives. The challenge is not unique to Europe. While worldwide investment in clean technology has risen, the headline figures mask a less rosy picture. The International Energy Agency (IEA) said in a report published on June 5 that global investment in power grids reached a record $390 billion in 2024 and is set to surpass $400 billion in 2025, 20% higher than a decade ago. But spending on power grid upgrades has not kept up. In 2016, about 60 cents were invested in grids for every dollar spent on new generation capacity. That ratio has dropped to less than 40 cents as the costs of renewables has declined, according to the IEA. This imbalance is unsustainable as ageing Western power systems – especially those in Europe – will increasingly experience problems unless trillions are spent in grid upgrades. The investment shortfall partly reflects a fundamental time horizon mismatch. Governments face public pressure every time energy bills – or taxes – rise, so they will struggle to convey to voters the long-term benefits of spending billions in tax dollars to support building modern, low-carbon power systems. But energy companies and utilities seeking to invest in renewables and grids will need long-term policy certainty, and given the challenging economics for many renewables projects, they will often also require generous subsidies. To be sure, the long-term costs of inaction to mitigate climate change will be far higher, and the EU is already spending over 100 billion euros annually on fossil fuels subsidies. But long-term thinking is not an easy sell for politicians in a time of growing populism, nationalism and polarization. Ultimately, if European governments want their populations to have cheap, green energy, they will need to accept the reality that getting there will be more expensive and more government-driven than previously advertised. Enjoying this column? Check out Reuters Open Interest (ROI), opens new tab, your essential new source for global financial commentary. ROI delivers thought-provoking, data-driven analysis. Markets are moving faster than ever. ROI, opens new tab can help you keep up. Follow ROI on LinkedIn, opens new tab and X., opens new tab
