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Rupee opens lower at 85.39/$ as high crude prices offset weak dollar
The domestic currency opened 13 paise lower at 85.39 against the greenback, after closing at 85.52 on Monday, according to Bloomberg. The weakness in the currency came after the unit snapped a four-day losing streak.
The Indian rupee, which strengthened to 85.38 on Monday, is expected to open lower and trade within a range of 85.25–85.75, according to Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP. "With the dollar index weakening and Asian currencies gaining, a move towards 85.00 is likely in the near term."
Foreign portfolio investors' outflows combined with firmer crude oil prices prevented a stronger rally on Monday, Amit Pabari, managing director at CR Forex Advisors, said. Global funds sold equity worth ₹2,589.47 crore while the crude oil prices rose over 3 per cent.
India's HSBC Manufacturing PMI fell to a 3-month low of 57.6 due to rising prices and weak exports, Pabari noted. However, fourth quarter GDP grew 7.4 per cent, driven by strong consumption and a surge in construction and manufacturing, he said. "Technically, the rupee is likely to trade in a range with 85.90-86.00 acting as a strong resistance, while 85.00-85.20 will act as a support."
The dollar index fell to its lowest since 2023 after the Manufacturing Imports Index and Manufacturing PMI slipped in the US. The Trump administration's renewed protectionist stance, unpredictable tariff threats, and tax policies have rattled institutional investors, causing a broad-based selloff in US equities and debt, experts said.
The dollar index, which measures the greenback against a basket of six major currencies, was up 0.17 per cent at 98.87. The index is likely to remain under pressure, facing strong resistance near the 99.80–100.00 zone and gradually declining toward 98, followed by 97.50, according to Pabari.
On the trade tariffs front, Beijing has yet to confirm whether Xi Jinping will participate in a call that the White House is hinting at for this week, according to reports. This comes after the two countries accused each other of violating a trade agreement reached last month.
In commodities, crude oil prices extended Monday's 3 per cent gains after the Opec+ agreed to increase production in July. Brent crude price was up 0.59 per cent to $65.01 per barrel, while WTI crude prices were 0.72 per cent higher at 62.97, as of 9:03 AM IST.
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The Print
22 minutes ago
- The Print
15 ‘oligarch billionaires' run India: Ex-Trump negotiator Lighthizer on why he failed with New Delhi
Late on Monday, Trump threatened substantial tariffs on India as he accused it of buying and reselling 'massive amounts' of Russian oil 'for big profits'. With Trump repeating the threat days after announcing 25% tariffs and a Russia penalty on India, a reading of Lighthizer's book presents key insights on Trump's India stance. Lighthizer writes in No Trade is Free that he would try to predict India's position in talks by tracking the interests of its 15 billionaires or 'oligarchs who ran the country', giving a rare insider's peek into how the US President's India policy has unfolded over his two terms. New Delhi: As US President Donald Trump has again threatened to raise tariffs on India supposedly for its Russian oil purchase, it's instructive to see what former US Trade Representative Robert Lighthizer, who set Trump's trade agenda and negotiated with India, had to say in a 2023 book. Lighthizer, a veteran trade negotiator and once a free-trade sceptic, is widely considered to have curated policy moves of US President Donald Trump, who abruptly revoked special trade privileges to India in his first term. He referred to these billionaires as 'oligarchs' and said it was unusual in the extent to which they 'influence government policy' in India. The 77-year-old also said that India 'suffered from an extremely strong professional bureaucracy' in all areas of government. 'When I was in negotiations with Indian officials, I kept a copy of the biography of each of the country's fifteen or so billionaires on my desk. In predicting Indian government positions, I would look to the interests of these men,' Lighthizer wrote in his book, which was published in 2023. India's opposition parties have often alleged that largecorporate houses and industrialists, such as Mukesh Ambani and Gautam Adani, enjoy easy access to Prime Minister Narendra Modi and his government, which work in their interests in exchange for funds. 'I can remember at one point telling an Indian friend of mine who had made a fortune in business that I thought there were fifteen oligarchs who basically ran the country. He corrected me. 'Bob, you're wrong. Only about seven of them actually run the country. The others just try to influence the seven',' Lighthizer wrote in the book, which has an entire chapter dedicated to India. Congress leader Rahul Gandhi has called Modi's government a 'suit-boot ki sarkar' (government for the rich) to try to corner the Bharatiya Janata Party as recently as during the 2024 general elections. The Prime Minister has outrightly rejected the allegations, saying that such deceitful political vendetta only hurts the electoral prospects of the Congress. While the two industrialists, also two of India's wealthiest men, have not addressed the charges publicly, their business entities have denied allegations by the Opposition on several counts. India's 'protectionism' In his second term, US President Trump is pushing on with a tariff blitz across countries as he attempts to 'reorder the global economy' with the highest rates since the 1930s. Talks between New Delhi and Washington to clinch a trade deal have remained stalled, with experts saying highly protected agriculture and dairy sectors are sticky issues. Lighthizer also referred to India's 'protectionist' stance in his book. 'India is particularly protectionist in the agricultural sector, where it uses tariffs and safety standards to help politically potent farmers groups,' he wrote in his book, which is full of praise for Trump and his style of politics. In fact, he wrote that he once told Prime Minister Modi that India was 'the most protectionist country in the world' and that it was causing a large and growing trade deficit. 'Indian trade policies have long caused tensions with the United States. India uses many of the tools of modern mercantilism. It has high tariffs, a bureaucracy focused on keeping imports out, and a system of industrial policy and protectionism.' Also Read: Pakistan, Dhaka have played Washington well. Back home, Modi ecosystem has an inner conflict 'Natural friends' India & US Lighthizer, however, said India and the US were 'natural friends'. 'Perhaps, most importantly, the rise and growing militarism of China is the greatest geopolitical concern for both our nations… India feels as threatened as we do by the aggressive surge of China. There is truth in the old saying (modified for obvious reasons) that the adversary of my adversary is my friend.' Lighthizer, once called by Trump the 'greatest United States trade representative in American history', played a crucial role in the imposition of hefty tariffs on Chinese imports during the first term of the US President. While India-US relations grew for the most part during the presidency of Joe Biden, they have remained fragmented due to several trade and policy differences under the deceptive exterior of a vibrant bonhomie between 'great friends' Trump and Modi. Lighthizer said that the Trump administration's strategy with India was to maintain good relations but to use what leverage it had to increase its access to India's market to 'obtain fairness and reciprocity in trade'. He also commented on what he thought of as Modi's personality and political vision. 'Prime Minister Narendra Modi is a particularly interesting figure. He came up through the ranks of right-wing political organizations and clearly considers himself a nationalist. His political party, the Bharatiya Janata Party, is a right-wing Hindu party.' He added: 'He is an extremely gifted politician and the first leader of India who was born after its independence in 1947… Of course, Modi is dedicated to raising India out of poverty. He believes in doing it through state control of innovation, high tariffs, mercantilism, and protectionism. There are lots of hangovers from the time of British rule, but free trade is not one of them.' High praise for Piyush Goyal Lighthizer was sworn in as the 18th US Trade Representative (USTR) in May 2017 and worked in the position till 20 January 2021. The USTR is responsible for developing and coordinating international trade, commodity, and direct investment policy, as well as overseeing negotiations with other countries. At the time he was chosen by Trump to serve as USTR, Lighthizer was a partner at the law firm Skadden, Arps, Slate, Meagher & Flom LLP (Skadden), where he practised international trade law for over 30 years. Before joining Skadden, Lighthizer served as deputy USTR for US President Ronald Reagan. During this tenure, he negotiated over two dozen bilateral international agreements, including pacts on steel, automobiles, and agricultural products. The latest flashpoint in the recent India-US talks came last week when the US President signed an order imposing a 25 percent tariff on India's exports, 'plus an unspecified penalty' for buying Russian oil and weapons. In the 2023 book, Lighthizer also reflected on his time negotiating with the Indian delegation on tariffs. 'I said (to PM Modi) that I had been negotiating with their trade minister, Suresh Prabhu, for two years and had made absolutely no progress. At times, I said, he had not even returned my call for weeks.' 'Soon after that meeting, negotiations began in earnest. This time they were with a new trade minister named Piyush Goyal, a smart, gifted politician from Mumbai. We raised our issues: tariffs, agriculture access, medical device impediments, barriers to e-commerce and insurance, discrimination in the electronic payment sector, fish subsidies, and the list goes on. We made headway but could never quite close a deal.' (Edited by Madhurita Goswami) Also Read:Trump tariff forces India to shed illusion. Stop conflating status with power
Hindustan Times
an hour ago
- Hindustan Times
Citing "uncertainty" over ISL's future, Bengaluru FC "indefinitely" suspends salaries of players
New Delhi [India], August 5 (ANI): Indian Super League (ISL) outfit Bengaluru FC released a statement to confirm that they have suspended the salaries of players and staff members due to the "uncertainty" surrounding the future of the tournament. HT Image The ISL, which is usually held from September to April, has been put on hold due to ongoing differences between the All India Football Federation (AIFF) and the board's partner, Football Sports Development Limited (FSDL). While taking the current situation into account, Bengaluru FC have "indefinitely" suspended the salaries. The 2018-19 ISL title winners claimed that they were left with no choice but to take such an action due to the lack of clarity regarding India's top-tier football league's future. "In view of the uncertainty surrounding the future of the Indian Super League season, Bengaluru Football Club has taken what is a very difficult decision of indefinitely suspending the salaries of players and staff belonging to the First Team. Running and sustaining a football club in India has always been an uphill climb, one that we have put everything aside and made, season after season," BFC said in a statement. Amid the ongoing issue, AIFF on Monday announced that a meeting has been scheduled with CEOs from eight Indian Super League (ISL) clubs for Thursday in the national capital to discuss the matter with the nation's top-tier football tournament. "However, the lack of clarity on the League's future leaves us with no choice but to take this step. The future and well-being of our players, staff, and their families is of utmost importance to us, and we are in touch with them as we wait for a resolution," the statement added. The current decision has resulted in the salaries of captain Sunil Chhetri, other players and staff members being suspended. However, the club confirmed that the youth teams will remain unaffected by this decision. Bengaluru FC urged the AIFF and FSFL to take a prompt decision and end the impasse quickly. "The Club remains committed to growing and developing the sport and our operations with our youth teams - men and women - and BFC Soccer Schools remain unaffected by this decision. We urge the AIFF and FSDL to end this impasse swiftly. The uncertainty benefits no one, and a prompt resolution is vital for the future of Indian football," the statement concluded. (ANI)
Hindustan Times
an hour ago
- Hindustan Times
Ukraine flags Indian-made parts in drones used by Russian forces
Ukraine has formally raised with the Indian government and the European Union (EU) the issue of electronic components made or assembled by firms in India being found on Iranian-designed drones used by Russian armed forces, people familiar with the matter said. The Shahed, a relatively inexpensive drone, has been used in large numbers by Russia to target Ukraine since late 2022. (REUTERS) The Ukrainian side raised the matter through formal diplomatic correspondence with the external affairs ministry on at least two occasions after these components were found on Shahed 136 unmanned combat aerial vehicles (UCAVs) since last year, according to the people cited above and documents reviewed by HT. Ukrainian diplomats brought up the issue with EU sanctions envoy David O'Sullivan when he visited New Delhi in mid-July, the people added on condition of anonymity. O'Sullivan travelled to India last month to brief Indian officials on the EU's latest sanctions package, which listed Vadinar refinery, jointly owned by Russian energy major Rosneft, and included an import ban on refined products made from Russian crude. According to the documents reviewed by HT, an investigation by Ukrainian authorities established that electronic components from Vishay Intertechnology and Aura Semiconductor – either assembled or made in India – were 'used by Russia in the production of the Shahed 136' UCAVs. The documents provided detailed information and images of specific components. A 'bridge rectifier E300359' of Vishay Intertechnology assembled in India was used in the Shahed's voltage regulator unit, while a PLL-based signal generator AU5426A chip made by Aura Semiconductor was used in the jammer-proof antenna for the drone's satellite navigation system, according to the documents. The people said, purely on a technical basis, the firms have not violated any Indian laws. External affairs ministry spokesperson Randhir Jaiswal responded to a query on the matter by saying: 'India's exports of dual-use items are in keeping with its international obligations on non-proliferation, and based on its robust domestic legal and regulatory framework. Due diligence is conducted to ensure that such exports do not violate any of our laws.' There was no official word on the matter from the Ukrainian embassy in New Delhi. However, Ukraine's defence intelligence directorate or HUR has reported about the Indian-origin components found in Shahed drones on its official Facebook page and Telegram channel. Several requests for a comment from Vishay Intertechnology, a US-based manufacturer of chips, optoelectronics and sensors, elicited no reply. Kishore Ganti, co-founder of Aura Semiconductor Pvt Ltd, the Bengaluru-based subsidiary of Ningbo Aura Semiconductor Co, said the firm ensures its products are used lawfully and ethically, and fully complies with all applicable national and international export control laws. 'We are deeply disturbed by the possibility that any of our components may have reached defence manufacturers through unauthorised third-party channels, in violation of our stated compliance framework and distribution agreements. We strongly oppose such activity and are committed to taking action wherever compliance gaps are identified,' Aura Semiconductor said in a statement. Ganti said that on becoming aware of the use of an 'Aura buffer product' in the Russia-Ukraine conflict, Aura undertook a limited audit to understand the end-use for the item in question. 'However, the findings of the audit were inconclusive with respect to supply chain/end-user visibility of the Aura buffer product,' Ganti said. The component is a 'plug-and-play' one and can be used without dependence on Aura for any kind of support, 'making it difficult for Aura to trace the end users in this instance', Ganti added. The people cited above said there were instances of electronic components made in India being legally exported to destinations in West Asia, from where they were diverted to Russia or Iran. After Ukraine raised the matter, representatives of Indian security agencies visited manufacturers of electronic components and chips in Delhi, Bengaluru and Mumbai to sensitise them about international restrictions related to dual-use items, the people said. The Shahed, a relatively inexpensive drone, has been used in large numbers by Russia to target Ukraine since late 2022. According to Ukraine's Security Service or SBU, Iran initially supplied 2,000 fully assembled drones to Russia, which later established its own assembly system using Iranian ready-made parts. Data from Ukraine's air force showed Russia launched 6,129 Shahed-type drones in July. Ukraine's defence intelligence directorate has also reported that electronic components from firms in the US and China have been found on Russian drones and other weapons. Ajay Srivastava, founder of the Global Trade Research Initiative (GTRI), said the components may have been diverted by foreign buyers to Iran through third countries. 'India strictly prohibits the export of dual-use items to sanctioned destinations. However, once such goods are exported to legitimate third countries, tracing their end use becomes nearly impossible – a challenge every open economy faces,' he said. These incidents underline the need for India to strengthen exporter awareness, especially in sensitive sectors, Srivastava said. 'Exporters must be better informed about high-risk geographies and flagged entities. But no system, however rigorous, can guarantee full control once goods leave Indian borders,' he added. 'Export compliance must be enforced, but blame must not be misdirected.'
