India: VS Achuthanandan, Kerala's former CM, dies at 101
He was 101 at the time of his death. The politician had been bedridden in recent years.
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Khaleej Times
3 hours ago
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India set to contribute 20% of total global growth by 2035
India is on track to become the world's third-largest economy by 2028 and to double its gross domestic product (GDP) to $10.6 trillion by 2035, contributing 20 per cent of total global growth over the next decade, according to a new Morgan Stanley report. The bullish projection reinforces India's status as the world's fastest-growing major economy, with a combination of decentralised state-level growth, robust domestic demand, and structural policy reforms propelling its upward trajectory. A standout theme in Morgan Stanley's forecast is the rise of states as key economic engines. Maharashtra, Tamil Nadu, Gujarat, Uttar Pradesh, and Karnataka are expected to be the first Indian states to each achieve a $1 trillion economy. Gujarat, Maharashtra, and Telangana are currently the top-performing states by GDP, while others like Uttar Pradesh, Madhya Pradesh, and Chhattisgarh have significantly climbed economic rankings over the past five years. This shift reflects the success of India's 'competitive federalism', where states are increasingly responsible for policy innovation, industrialisation, and urbanisation. The report highlights how India's decentralised growth model is underpinned by sub-national governance, with states implementing agile policies and infrastructure initiatives tailored to their local economies. This trend is driving industrial diversification, improving labour markets, and attracting foreign and domestic investments. Morgan Stanley also expects India to contribute 20 per cent of total global growth over the next decade. As multinationals seek alternatives to China in their supply chains, India is emerging as a compelling manufacturing destination. This shift is bolstered by the government's Production Linked Incentive (PLI) schemes, which are beginning to show results in the form of rising exports, industrial capacity utilisation, and new global partnerships in electronics, semiconductors, pharmaceuticals, and renewable energy. India's capital markets are also a major growth story. According to Bloomberg data, Indian benchmark indices have outperformed most emerging markets over the past three years, driven by resilient corporate earnings, strong domestic consumption, and continued infrastructure spending. Foreign portfolio investments have remained robust, and market confidence has been further reinforced by the stability of the financial system and policy continuity. According to the Asian Development Bank (ADB), India's GDP is forecast to grow 6.5 per cent in 2025 and 6.7 per cent in 2026, supported by strong domestic demand, a normal monsoon, and expected monetary easing. Inflation is also moderating, with the Consumer Price Index (CPI) dropping to 2.1 per cent in June 2025 — the lowest in 77 months — as food inflation turned negative. ADB projects inflation to remain within the Reserve Bank of India's target range at 3.8 per cent in 2025 and 4.0 per cent in 2026. The Confederation of Indian Industry (CII) echoes these sentiments, projecting India's real GDP growth to range between 6.4 and 6.7 per cent this fiscal year. This reinforces India's position as the world's fastest-growing major economy, even as global growth slows and other developing Asian economies face headwinds from trade policy shifts and weakened exports. While the broader Asia-Pacific region grapples with uncertainties — such as escalating US tariffs, slowing Chinese growth, and geopolitical tensions — India appears better insulated. ADB's Chief Economist Albert Park noted that although Asia faces a weakening external environment, economies that maintain open trade and strong investment fundamentals can sustain growth momentum — India being a prime example. Domestic indicators show a mixed short-term picture. ICRA estimates India's GDP growth in the first quarter of FY26 to range between 6.1 and 6.5 per cent, down from 7.4 per cent in the previous quarter. The slowdown is attributed to excessive rainfall affecting coal production and power generation in June. Rating agency ICRA's Business Activity Monitor showed a 5.9 per cent year-on-year rise in June, slightly easing from 6.4 per cent in May. However, GST e-way bill generation and railway freight remained robust. The core sector growth moderated to 1.7 per cent in June, with weak performance in crude oil, refinery products, and electricity. Passenger vehicle and two-wheeler sales also slowed, alongside some softening in rural and urban labour market indicators. However, financial conditions have eased across markets, supported by policy rate cuts and improved liquidity. Despite short-term fluctuations, ICRA maintains a full-year GDP growth forecast of 6.2 per cent for FY26, assuming a well-distributed monsoon, stable crude oil prices around $70 per barrel, and continued rural demand. Risks remain, particularly from global economic volatility, energy market fluctuations, and escalating trade tensions.
Khaleej Times
a day ago
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Trump says Cambodia, Thailand agree to meet and 'work out' ceasefire
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Gulf Today
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India's Modi announces credit worth $565 million to Maldives
Indian Prime Minister Narendra Modi on Friday announced a $565-million line of credit to the Maldives during a visit to the Indian Ocean archipelago, as the two countries launched formal talks for a free-trade agreement. Modi is visiting the Maldives, known for its upmarket tourist resorts, to mark the 60th anniversary of its independence and diplomatic relations between the two countries. The announcement came during Modi's joint media statement with Maldives' President Mohamed Muizzu. The two-day visit is crucial to India's ambition to control the seas and shipping routes of the Indian Ocean in a race with its regional rival China. It also marks the further easing of diplomatic tensions between the two nations that followed the election of pro-China Muizzu in 2023. Regional powers India and China compete for influence in the archipelago nation, which is strategically located in the Indian Ocean. On Friday, Modi witnessed the exchange of agreements to cooperate in sectors such as fisheries, health, tourism and digital development. He also formally handed dozens of heavy vehicles to the Maldives' defense forces. 'India is Maldives' closest neighbor. Maldives holds an important place in both India's neighborhood- first policy and ocean vision,' Modi said. 'India is also proud to be Maldives' most trusted friend.' The line of credit will be used for 'infrastructure and development projects in line with the priorities of the people of the Maldives,' he said. 'India will continue to support Maldives in developing its defence capabilities. Peace, stability and prosperity in the Indian Ocean region is our common goal,' he added. During Muizzu's visit to India last October, India announced financial support to the cash-strapped Maldives in the form of a $100-million treasury bills rollover and the countries signed a $400-million currency swap agreement. Tensions between India and the Maldives grew since Muizzu, who favored closer ties with China, was elected in 2023 after defeating India-friendly incumbent Ibrahim Mohamed Solih. Leading up to the election, Muizzu had promised to expel Indian soldiers deployed in the Maldives to help with humanitarian assistance. Last year New Delhi replaced dozens of its soldiers in the Maldives with civilian experts. Measure by Modi to promote tourism in India's Lakshadweep archipelago, off the southwestern coast of the Indian mainland, also sparked anger from Maldivians, who saw it as a move to lure Indian tourists away from their country. Indian celebrities then called for a tourism boycott to the Maldives. The dispute deepened when Muizzu visited China ahead of India in January last year, a move seen by New Delhi as a snub. On his return, Muizzu spelled out plans to rid his tiny nation of dependence on India for health facilities, medicines and import of staples. Relations started to improve after Muizzu attended Modi's swearing-in ceremony for a third five-year term. Muizzu has toned down his anti-Indian rhetoric, and official contacts with New Delhi have intensified as concerns grew about Maldives' economy. India has long been a critical provider of development assistance to the Maldives. Meanwhile, the Maldives joined China's Belt and Road Initiative in 2013 to build ports and highways and expand trade as well as China's influence across Asia, Africa, and Europe. Modi will attend the Maldives' 60th independence anniversary from being a British protectorate on Saturday. Separately, the Reserve Bank of India has 'won the battle against inflation' but the war is ongoing as price stability remains the central goal, Governor Sanjay Malhotra said during a fireside chat at a Financial Express event on Friday. The RBI delivered a larger-than-expected 50 basis point rate cut at its June policy review but shifted its stance to 'neutral,' suggesting limited room for further easing. However, with retail inflation falling to a six-year low and likely to hit a record low in July, calls have grown for at least one more rate cut this year. Many analysts argue the sharp disinflation also points to weakening demand in the economy. Malhotra said monetary policy being forward looking, will place greater focus on the outlook for growth and inflation, rather than current levels when the policy panel meets on Aug. 6. The change in stance to 'neutral' did not mean a reversal from the easing of policy, he said. 'We have the flexibility to move up, down or pause. Yes, it does mean, the bar for further easing is higher than it would have been if it (stance) was accommodative,' he added. Monetary policy transmission has quickened due to rate cuts and will help in supporting economic growth as overall flow of funds to the industry and economy is improving, Malhotra said. Further monetary policy measures would depend on the requirement but the central bank has enough ammunition in its armory to use as and when required, he added. Agencies
