Masterstroke by Modi govt as Russia agrees to...., India set to boost it's arsenal by buying deadly weapons like...
Russian President Vladimir Putin is coming to Delhi in September this year to participate in the annual summit between India and Russia. This is the first time that the Russian President is visiting India since war with Ukraine. During this time, Russia is expected to offer both conventional and nuclear submarines and long-range cruise missiles.
What is Russia expected to offer?
According to reports, Russia is offering the lease and transfer of a second Akula class nuclear-powered attack submarine, at least six refurbished Kilo class submarines and 1500-kilometer-range Caliber cruise missiles. India currently has 17 conventional submarines, two-thirds of which were purchased in the 1980s and now these submarines are getting old. Their service life is ending. Therefore, India now needs new submarines.
What are the benefits to India from Russia's proposal?
Russia has been India's largest defense equipment supplier for the last five decades. Even today, 60% of India's military assets are of Russian origin, including T-72 and T-90 tanks, Kilo class submarines, and most importantly SU-30MKI fighter jets. The BrahMos supersonic cruise missile, which India recently used to attack Pakistani airbases during Operation Sindoor, is a joint project of Russia and India. Although in the last few years India has reduced its dependence on Russia alone and started buying weapons from countries like Israel, South Korea, Germany, France and the US, Russia still remains India's largest defense partner.
Why is Russian President's visit to India very important?
This visit of Putin will be his first visit to India after the Russia-Ukraine war. This comes after Prime Minister Narendra Modi visited Moscow on his first bilateral visit after becoming PM for the third time in July 2024 last year to participate in the 22nd India-Russia dialogue. Now, ahead of the 23rd dialogue, Russia is making offers to India in areas where the US cannot compete, such as nuclear submarines, long-range cruise missiles and S-500 air defense systems. The US has neither sold nor leased its nuclear submarine to any country till date. Apart from this, the US has also given its Tomahawk missile only to Britain. In such a situation, Russia remains the only most reliable option for India. The 1500 km range Caliber land-attack cruise missile is considered a major strategic offer from Russia.
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First Post
6 minutes ago
- First Post
Alaska summit: Putin wins hands down as Trump gifts him time
The Alaska summit proved that neither Trump knows Putin nor can guarantee a ceasefire or peace It was the typical high-voltage Donald Trump pomp and power show at the Joint Base Elmendorf-Richardson in Anchorage, Alaska, on Friday. A B-2 Spirit Bomber escorted by four F-35 Lightnings conducted a flyover as a desperate Trump tried to persuade Vladimir Putin to reciprocate his unrequited love. They shook hands on the red carpet and later posed on a blue stage emblazoned with 'ALASKA 2025' amid parked F-22 Raptors. However, hours before, Putin, in his subtle yet powerful style, had already delivered his message loud and clear: Make USSR Great Again (MUGA). STORY CONTINUES BELOW THIS AD Harking back to the Soviet Union's superpower days of global dominance during the Cold War, Russian foreign minister Sergey Lavrov arrived at a hotel where Trump and Putin later met sporting an unusual dress breaking the diplomatic protocol. A black jacket over a white sweatshirt emblazoned with 'CCCP'—Union of Soviet Socialist Republics—and light blue denims. Lavrov's dress wasn't merely symbolic; it conveyed two messages. First, Putin's longing for the USSR's lost greatness and anger at its disintegration, which the Russian president had termed 'the greatest geopolitical catastrophe of the 20th century'. Second, Russia's immense confidence in being back in the diplomatic fold after being declared a pariah by the West since Putin invaded Ukraine in February 2022. The stage was set. The performers were ready. Trump was accompanied by Marco Rubio (secretary of state), John Ratcliffe (CIA director), Steve Witkoff (special envoy to Ukraine and the Middle East). Scott Bessent (treasury secretary) and Howard Lutnick (commerce secretary). Putin's entourage comprised Lavrov, Yuri Ushakov (foreign policy adviser), Andrei Belousov (defence minister), Kirill Dmitriev (Russian Direct Investment Fund chief) and Anton Siluanov (finance minister). The audience expected to be spellbound by a scintillating performance by the brilliant cast. However, the most-anticipated drama was a big flop for the American audience and international media. STORY CONTINUES BELOW THIS AD Neither Trump nor Putin took questions from a quote-famished media as reporters jostled to get even one comment. Both made their statements and left the media disappointed. Antagonist Putin turns protagonist The Russian president came, he saw and he conquered. Putin was brimming with confidence from the moment he agreed to take a ride on The Beast, Trump's armoured limousine, at the latter's request. He was a virtuoso, an artiste who had crafted and polished his skills in dealing with five American presidents—Bill Clinton, George W Bush, Barack Obama, Joe Biden and Trump (six times in his first term).After the summit ended, Putin was the first to address the media as Trump stood silent by his side. Putin got what he eagerly sought—that too on American soil. Despite being shunned by the West, especially the Joe Biden administration, and having an ICC arrest warrant for committing war crimes in Ukraine, his performance was excellent. First, Putin, whose troops occupy around 18 per cent of Ukraine, including Crimea, 70 per cent of Donetsk and almost all of Luhansk (Donbas) and two-thirds of Kherson and Zaporizhzhia, came out with the biggest gain. STORY CONTINUES BELOW THIS AD Putin has time till November-end to capture more Ukrainian territory and to negotiate with both Trump and Ukrainian President Volodymyr Zelensky from a more powerful position. By December, Ukraine's harsh winter would set in, making fighting extremely difficult. The Russian advance in eastern Ukraine has been incremental but continues. Putin has around three months to turn these slow gains into strategic wins. Moreover, neither Trump nor Putin announced the venue and date of another meeting. Putin wants to freeze the gains and the conquered areas in Russia's fold and Zelensky to drop his goal of joining NATO. The Ukrainian president rejects both demands. Before and after the summit, Trump said that a tri-lateral meeting between Putin, Zelensky and him would be the best option to reach peace. The Alaska summit was held months after Trump showed a willingness to meet Putin. Convincing Putin and Zelensky to meet face-to-face will require intensive diplomatic efforts and hectic parleys between the three countries. That will allow Putin to buy more time to advance further inside Ukraine. STORY CONTINUES BELOW THIS AD Zelensky was quick to highlight how Putin will use the opportunity. '… we anticipate that in the coming days the Russian Army may try to increase pressure and strikes against Ukrainian positions in order to create more favourable political circumstances for talks with global actors', he wrote on Telegram. Second, Putin re-established diplomatic ties with the US amid a grand welcome in a country that led Nato against him without the Russian leader taking one step back. 'The past period was very difficult for bilateral relations. And, let's be honest. They have slid to the lowest point since the Cold War. … Obviously, sooner or later, it was necessary to correct the situation—to move from confrontation to dialogue. And in this regard, a personal meeting of the heads of the two states was really overdue,' he said with Trump by his side. Third, the much-touted summit hinged on a territorial swap between Russia and Ukraine—rejected by Zelensky—to reach a peace deal and end Europe's bloodiest war since WWII. That's what Trump had been chiming before the summit to the shock of European allies. However, during a virtual call with European leaders later, he said that any territorial concession should be decided by Ukraine. There was no discussion about a territorial swap at the meeting. STORY CONTINUES BELOW THIS AD Fourth, Putin didn't even agree to a ceasefire—forget a peace deal. Earlier too, he never agreed to a ceasefire and continued with the onslaught despite several attempts by Trump and Witkoff, who had met Putin four times in over two months. Despite praising Trump and his administration for facilitating 'the resolution of the Ukrainian conflict', Putin didn't indicate ending the conflict. Fifth, he again blamed Ukraine, as did Trump during Zelensky's White House visit in February, for starting the war and repeated how Russia's security is under threat. 'I have said more than once that for Russia, the events in Ukraine are associated with fundamental threats to our national security.' On the other hand, Putin, using his trademark tactics, terming Ukrainians 'brotherly no matter how strange that may sound in today's conditions'. 'We have the same roots and everything that is happening for us is a tragedy and a great pain.' Putin put the ball in Trump's court while conflating Russia's 'legitimate concerns' and the 'root causes of the crisis' with a ceasefire and Ukraine's security. 'Therefore, our country is sincerely interested in putting an end to this. But at the same time, we are convinced that for the Ukrainian settlement to be sustainable and long-term, all the root causes of the crisis must be eliminated.' STORY CONTINUES BELOW THIS AD Putin was referring to Nato's eastward expansion and Ukraine's ambition to be part of the military bloc. Though Ukraine's security 'must, without a doubt, be ensured' and 'I would like to hope that the understanding we have reached will allow us to get closer to that goal and open the way to peace in Ukraine', Russia's 'legitimate concerns must be taken into account, and a fair balance in the security sphere in Europe and the world as a whole must be restored'. Putin said. Sixth, he massaged Trump's ego without conceding anything. 'Overall, we have established a very good business-like and trusting contact with President Trump,' he said knowing well how Trump gloats in self-praise and all the more when patted on the back by an adversary like him. 'And I have every reason to believe that by moving along this path, we can—the quicker the better—reach an end to the conflict in Ukraine,' Putin said without mentioning a timeline to end the war or even a ceasefire. STORY CONTINUES BELOW THIS AD Putin's best shot was slamming Joe Biden and praising Trump for saying that the war would have never happened if he were the US president. 'And in the end, I would like to add one more thing. I'd like to remind you that in 2022, during the last contact with the previous administration, I tried to convince my previous American colleague that the situation should not be brought to the point of no return when it would come to hostilities and accept it quite directly back then—that is a big mistake,' he said of Biden without naming him. In the biggest boost to the US president's ego, he said that if Trump were the president in 2022, the war wouldn't have started, as claimed by him during the 2024 US election campaign. 'Today, when President Trump is saying that if he were the president back then, there would be no war, and I'm quite sure that it would indeed be so. I can confirm that,' Putin said. He even invited Trump to Moscow for another meeting—if it is held at all—in a rare public use of English. 'Next time in Moscow?' he said as the joint presser ended triggering an expected reaction from Trump, who said, 'Ooh! That's an interesting one. I don't know. I'll get a little heat on that one, but I could see it possibly happening. Thank you very much, Vladimir.' Trump was never in control of the plot Trump looked visibly exhausted. The American president expected to mesmerise the audience—but his performance was below average. There was no ceasefire or peace deal, contrary to his boastful claims of one in the offing, as Russia continued to attack Ukraine during the around-three-hour meeting. Inviting Putin to the US was Trump's first mistake. The cringeworthy display of military power play and posing with Putin, flanked by Raptors, was the second mistake. The big, hollow claims and threats made by Trump in the months and days leading up to the summit were his third and biggest blundTrump is all bluster and no bite whenever he confronts an equally dominating and powerful adversary like Putin or Chinese President Xi Jinping. Trump wrote the Alaska summit script, but Putin controlled the plot. The Russian leader pulled the strings and his American counterpart danced all along—even in the months before the summit. Trump, like his predecessors, has failed miserably to read the former KGB agent, despite meeting him five times and talking to him over the phone nine times in his first presidency, seven calls after office and another six calls in his second term. Russian leaders have always outsmarted their American counterparts. Two months after America's failed Bay of Pigs invasion in Cuba, John F Kennedy met Soviet leader Nikita Khrushchev at a summit in Vienna in 1961. In 1962, Khrushchev deployed nuclear missiles in Cuba, jolting Kennedy and bringing the world to the precipice of Armageddon. 'Kennedy allowed himself to be bullied by Khrushchev [in Vienna] and he regretted it,' according to award-winning journalist Evan Thomas, who authored the book Being Nixon: A Man Divided. 'Some scholars think that Khrushchev felt like he could push Kennedy around. And that made him, perhaps, more likely to put the missiles into Cuba.' Trump failed like Kennedy. From his campaign trail's hollow claim to end the war in 24 hours if he returned to power to cajoling and coercing Putin, Trump's blustering narrative of how he could influence the Russian leader to sign a peace deal fell flat and exposed his flaws. When Putin rejected his ceasefire offers, Trump threatened sanctions. The Russian president was unrelenting. Soon, Trump's frustration with him was public. He was visibly 'very angry' and 'pissed off' at the 'bullshit' thrown by 'crazy' Putin. Finally, he gave Putin a 50-day deadline to end the war or face more sanctions and secondary sanctions on top buyers of Russian crude oil (China and India). He failed. Then Trump reduced the deadline to 10-12 days. He failed again. Trump had also boasted that he would know exactly in 'the first two minutes' of the meeting whether a deal could be made', and also vowed to 'walk' away from the table if the talks remained inconclusive. In the end, it boiled down to a no-show with Trump's blow-hot-and-cold attitude resulting in a mockery. Trump's 'two-minute' boast fizzled out as the meeting lasted for more than two-and-a-half hours—neither did he walk away from the unproductive talks as pledged earlier. In his statement, shorter than that of Putin's, Trump's usual strategy of fake claims regarding the war and his one-sided bromance with Putin were on display. '…I believe we had a very productive meeting. There were many, many points that we agreed on, most of them, I would say,' he said despite Putin not agreeing to even a ceasefire. 'There are just a very few that are left. Some are not that significant. One is probably the most significant, but we have a very good chance of getting there. We didn't get there, but we have a very good chance of getting there,' he added. Aware that he had achieved nothing but zilch, Trump admitted that there were 'a couple of big ones [points] that we haven't quite gotten there, but we've made some headway. So, there's no deal until there's a deal'. Sensing that he would be pilloried by the media for failing to squeeze even one ounce of concession from Putin, Trump conveniently put the onus on NATO and Zelensky. 'It's ultimately up to them. They're going to have to agree with what Marco and Steve.' Finally, he was back to his admiration for Putin, who has always manipulated him. Claiming that Putin and he 'really made some great progress today', Trump said, 'I've always had a fantastic relationship with President Putin—with Vladimir. We had many, many tough meetings, good meetings.'To please Putin further, Trump reiterated that the Russian interference in the 2016 US presidential election was a 'hoax'. 'We were interfered with by the Russia, Russia, Russia hoax. It made it a little bit tougher to deal with, but he [Putin] understood it. I think he's probably seen things like that during the course of his career. He's seen—he's seen it all. But we had to put up with the Russia, Russia, Russia hoax. He knew it was a hoax, and I knew it was a hoax.' Trump's statement was a redux of his meeting with Putin in Helsinki in July 2108 when he sided with Russia against US intelligence agencies and denied any election interference. In another feat of imagination, Trump concluded by saying that both were on the same page about stopping the killing of Ukrainians. 'We had some good meetings over the years, right? … Let's do the most productive one right now. We're going to stop, really, 5, 6, 7 thousand, 1000s of people a week from being killed, and President Putin wants to see that as much as I do.' Post-summit comments show who's winner A few days before the summit, the White House was careful not to portray it as a Trump show that could guarantee a ceasefire or a peace deal. However, Trump was back to his boisterous ways claiming that Putin wants a peace deal, not to occupy the whole of Ukraine, because of their rapport. 'I think he [Putin] has wanted the whole thing,' he told Fox News host Brian Kilmeade's radio show. 'But because of a certain relationship that he has with me running this country, I believe now he's convinced that he's going to make a deal. He's going to make a deal. I think he's going to.' Later, he doubled down on his claim at the White House. 'I think President Putin will make peace.' Trump's claim sounded very stale. In February, he made the same claim. 'I mean, I know him very well. Yeah, I think he wants peace. I think he would tell me if he didn't.' The Alaska summit proved that neither Trump knows Putin nor can guarantee a ceasefire or peace. Putin didn't concede anything while Trump gave away everything. The post-summit comments proved how Putin had outmanoeuvred Trump. In his first comments after the summit, all Putin had to say was a few words of praise for Trump and how they 'talked about a possible resolution of the Ukrainian crisis on a fair basis'. 'The visit was timely and very useful. We discussed practically all areas of our cooperation,' he said without providing any details about the points of cooperation, a ceasefire or peace. 'We naturally respect the position of the US administration, which sees the need for an immediate end to hostilities, and we would also like to see this happen. We would like to move towards resolving all issues by peaceful means. No indication of a ceasefire, an end to the conflict or even a trilateral meeting with Trump and Zelensky. On the other hand, Trump granted Putin's wish. 'I wouldn't be thrilled if I didn't get it [a deal],' he told Fox News on the way to Alaska. 'Everyone says, 'You're not going to get a ceasefire. It'll take place in the second meeting.' But I'm not going to be happy with that.' Several hours later, Trump made a predictable U-turn realising that he had returned empty-handed—no ceasefire but only a peace deal. In the event, there was no agreement on a ceasefire, and Trump downplayed its importance in a post on Truth Social as he returned to Washington. 'It was determined by all that the best way to end the horrific war between Russia and Ukraine is to go directly to a Peace Agreement, which would end the war, and not a mere Ceasefire Agreement, which often do not hold up,' he posted on Truth Social after returning to Washington. It's obvious that Putin didn't agree to a ceasefire and called for a peace deal so that he could buy more time to continue his assault and seize more Ukrainian territory. That's the reason both presidents refused to interact with the media at Anchorage. If Trump had revealed what transpired at the meeting and how he agreed to Putin's insistence on a peace deal, not a ceasefire, he would have faced a barrage of questions. Dmitry Medvedev, deputy chairman of the Security Council of Russia and a former president, summed it up precisely how Putin got what he wished for without preconditions. 'Important fact. The meeting has demonstrated that negotiations are possible without preconditions while the Special Military Operation continues,' he wrote. The writer is a freelance journalist with more than two decades of experience and comments primarily on foreign affairs. He tweets as @FightTheBigots. Views expressed in the above piece are personal and solely those of the writer. They do not necessarily reflect Firstpost's views.
The Hindu
6 minutes ago
- The Hindu
Here are this past week's main stories in charts
(1) Plea for SC/ST 'creamy layer' in Supreme Court The Supreme Court sent a notice to the Centre after it received a plea calling for the establishment of a creamy layer system in SC/ST reservations, similar to that seen within the OBC. Currently, a creamy layer is recognised for SCs and STs only in promotions within government jobs. This comes from a 2006 verdict that said the creamy layer will be taken into account for such promotions. Here is a brief timeline of key judgments regarding the issue, noting the considerations before the Court. These key judgments have shown that a majority of judges in Supreme Court Benches have supported the creation of a 'creamy layer' of SCs and STs based on individual conditions, while recognising the inherent backwardness of these communities as a whole. When it comes to reservation at other levels, what is to be decided by States is the criteria to decide what constitutes the creamy layer - whether it is economic conditions, vocations or something else. (2) Trump-Putin Alaska summit yields no deal on war U.S. President Donald Trump said on Saturday (August 16. 2025) that Ukraine should make a deal to end the war with Russia because 'Russia is a very big power, and they're not', after a summit where Vladimir Putin was reported to have demanded more Ukrainian land. After the two leaders met in Alaska on Friday, Trump told Ukrainian President Volodymyr Zelenskiy that Putin had offered to freeze most front lines if Kyiv ceded all of Donetsk, the industrial region that is one of Moscow's main targets, a source familiar with the matter said. Zelenskiy rejected the demand, the source said. Russia already controls a fifth of Ukraine, including about three-quarters of Donetsk province, which it first entered in 2014. The meeting between US and Russian presidents, Donald Trump and Vladimir Putin, was billed as a vital step towards peace in Ukraine. But with no ceasefire and an invitation to Moscow, the meeting has yielded more questions than answers. Russia launched a full-scale invasion of Ukraine in February 2022 and has been gradually advancing for months. The war - the deadliest in Europe for 80 years - has killed or wounded well over a million people from both sides, including thousands of mostly Ukrainian civilians, according to analysts. (3) Retail inflation eases to 8-year low of 1.55% in July Retail inflation in India slipped to 1.55% in July 2025, the lowest since June 2017, and below the Reserve Bank of India's comfort band of 2-6%, primarily led by a contraction in food prices. The Consumer Price Index (CPI), released by the Ministry of Statistics and Programme Implementation on Tuesday (August 12, 2025), showed inflation in India has been easing for nine consecutive months. The rate of inflation in the food and beverages category came in at -0.8% in July 2025, lower than -0.2% in June and 5.1% in July 2024. Vegetable and pulses prices contracted 21% and 14% respectively, driven by a high base and falling prices. Core inflation, which excludes the impact of food and fuel prices, also eased to 4.1% in July 2025 from 4.4% in the previous month, nearly at the RBI's target of 4%. The other broad categories in the CPI saw inflation remaining nearly the same in July as in June. The pan, tobacco and intoxicants category saw inflation remain flat at 2.4% in July. Similarly, the clothing and footwear category saw inflation ease marginally to 2.5% in July from 2.5% in June. Inflation in the housing segment remained at 3.2% in July, while that in the fuel and light category quickened to 2.7% in July from 2.5% in June. (4) Three-member panel to probe Justice Yashwant Varma case Lok Sabha Speaker Om Birla on Tuesday (August 12, 2025) set in motion the process of removing Justice Yashwant Varma of Allahabad High Court by admitting a motion, signed by 146 members, and constituting a three member inquiry committee to probe the charges against Justice Varma. The inquiry committee comprises Supreme Court judge Justice Aravind Kumar, Madras High Court Chief Justice Manindra Mohan Shrivastava and senior Karnataka High Court advocate B.V. Acharya. Justice Varma was repatriated from the Delhi High Court to the Allahabad High Court after burnt wads of currency notes were found at his official residence on March 14. Subsequently, an in-house inquiry of the Supreme Court had indicted Justice Varma. Earlier, then Chief Justice of India (CJI) Sanjiv Khanna had initiated an in-house probe into the allegations and set up the three-member committee in March to conduct the inquiry. After receiving the report, the CJI asked Justice Varma to resign or face impeachment proceedings. However, since Justice Varma declined to quit, CJI Khanna then forwarded the report and the Judge's response on it to the President of India and the Prime Minister for removal of the judge. Though Justice Varma had moved the Supreme Court against CJI Khanna's recommendation for his removal, the top court rejected his plea. (5) Afghanistan begins its fifth year of Taliban rule On August 15, 2021, the Taliban marched into Kabul, returning to power after two decades, as internationally backed President Ashraf Ghani fled the country. Since then, the former insurgents have consolidated their grip on power, excluded women and girls from public life, stamped out internal dissent and external challengers, and gained debut recognition as the country's official government from Russia, a permanent member of the U.N. Security Council. The Taliban govern through decrees, but Afghans have aspirations and needs that cannot be fulfilled through edicts and ideology. Here is a look at key dates since the Taliban returned to power four years ago:
Mint
6 minutes ago
- Mint
Can Nifty 50, Bank Nifty scale record highs before Diwali 2025? These 5 factors hold key
The Indian stock market saw strong, broad-based buying on Monday, August 18, driving the benchmark Nifty 50 past the 25,000 mark for the first time since July 25. The Sensex, Nifty 50, and Nifty Bank indices gained over 1 per cent each during the session, as sentiment was lifted by Prime Minister Narendra Modi's announcement on GST reforms, hopes of a Russia-Ukraine peace deal, signals from US President Donald Trump that he may reconsider secondary tariffs on India, and S&P's upgrade of India's credit rating. With expectations building around multiple tailwinds in the near term, investors are betting that the Sensex, Nifty, and Bank Nifty could scale record highs in the short term. It appears that the Indian stock market is at a crucial juncture of trend reversal, supported by the government's renewed focus on reforms, favourable growth–inflation dynamics, and expectations of US tariffs easing to manageable levels. "On the global front, easing economic and trade-related uncertainties—particularly between India and the US—would support investor sentiment. Domestically, the RBI's recent rate cuts are expected to reduce borrowing costs, which can stimulate demand and support both consumption and investment," said Ajit Mishra, SVP of research at Religare Broking. "The government's GST reform proposal, if implemented smoothly, could enhance consumer spending and business confidence. Ultimately, the most decisive factor will be corporate earnings—if upcoming results reflect a strong and broad-based recovery across sectors, it may well provide the trigger for the market to test new highs during the festive season," said Mishra. Experts point to five key factors that could determine whether the domestic market scales record highs before Diwali 2025. If Trump decides to withdraw the secondary tariffs imposed on India, it would provide significant relief to the market. In such a scenario, experts expect foreign investors to return in large numbers, potentially driving the market to unprecedented highs. Trump has hinted that the retaliatory tariffs on countries like India and China for procuring Russian oil may be dropped in case of a positive outcome on the Russia-Ukraine front. "If the US tariff war against India eases, foreign portfolio investors (FPIs) are expected to return in a big way. A rollback of tariffs to the 19–20 per cent range could trigger strong inflows, given that India's economic fundamentals remain intact, S&P Global has upgraded the country's rating despite tariff risks, and oil prices are expected to soften further," said G Chokkalingam, the founder and head of research at Equinomics Research Private Limited. "Easing economic and trade-related uncertainties—particularly between India and the US—would support investor sentiment," said Ajit Mishra, SVP of research at Religare Broking. On August 15, PM Modi announced the next-generation GST reforms. This could be a game-changer for the Indian economy as it may boost consumption, which has been lacklustre despite the good monsoon. According to reports, most products and services attracting a tax rate of 12 per cent and 28 per cent will be shifted to the 5 per cent and 18 per cent slabs, respectively. After relief on the income tax front, announced in Budget 2025, the GST reforms could boost rural and urban consumption, boosting the Indian economy. "The announcement of GST reforms is perhaps the most promising development. While monsoons have been favourable for three consecutive years, discretionary spending has not picked up to the extent seen in earlier periods of good rainfall. The proposed GST reform is a long-awaited move and could be a game-changer, as it would boost disposable incomes, thereby driving corporate earnings growth," Chokkalingam observed. Chokkalingam added that India has already benefited from direct tax concessions, and an indirect tax cut would further strengthen aggregate demand and help cushion external headwinds. According to brokerage firm Emkay Global, GST reforms could be a rerating trigger for the market, given the long-term growth benefits to the economy. The brokerage firm has revised its Nifty target to 28,000 for September 2026, with an aggressive 20.7 times one-year forward price-to-earnings ratio (+1sd above the five-year average). "The GST rationalisation offsets near-term worries on weak growth and tepid earnings. The six-week downtrend should now reverse, as the outlook for earnings improves considerably, and valuations will factor in the broader positives of this big-ticket reform measure," said Emkay. As India's growth outlook remains robust and inflation is under control due to easing food inflation and lower crude oil prices, corporate earnings are expected to improve from the second half of the financial year (H2FY26). Brokerage firm Motilal Oswal Financial Services estimates FY26 PAT (profit after tax) growth of 9.8 per cent for Nifty. "Given a favourable base effect, markets are likely to respond positively, especially as multiple government measures are expected to improve overall growth dynamics and sentiments in H2FY26," said the brokerage firm. The Reserve Bank of India (RBI) is expected to further reduce the repo rate as inflation remains low and economic growth comes into focus amid tariff concerns. Experts expect a rate cut in the upcoming policy decision on October 1. "A reversal in the interest rate cycle would act as another significant tailwind for the markets, with the RBI widely expected to cut rates in its upcoming policy meeting," said Chokkalingam. At this juncture, the scope of a rate cut by the US Federal Reserve appear feeble given the fact that the impact of Trump's tariffs on the US inflation will be visible from the coming months. Emerging markets like India tend to receive healthy foreign capital inflows when the dollar weakens and bond yields moderate. This can happen only if the Fed embarks on aggressive rate cuts. Shrikant Chouhan, the head of equity research at Kotak Securities, underscored that the market appears expensive in terms of valuations, with the index trading at 19 times FY27 earnings (one year forward). "If we receive external liquidity support, the market could surpass its previous highs. For this to happen, a decline in the dollar index or the 10-year bond yield would be necessary. This could occur if the US opts for an aggressive rate cut, which, while unlikely, cannot be entirely ruled out. Such a scenario would help strengthen our currency and attract foreign investments," said Chouhan. Read all market-related news here Read more stories by Nishant Kumar Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.
