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Mint
17-07-2025
- Business
- Mint
Trade turns turbulent; here's how India is tracking the winds
India is building a global trade data intelligence system that will offer real-time insights and early warnings of emerging stress points, two people aware of the matter said. The commerce ministry initiative called Global Trade Watch is modelled on similar efforts in the US, EU and China, and part of a drive to fortify export strategy amid escalating trade volatility. The initiative will integrate inputs from various ministries and agencies to track sector-specific performance across goods and services. It will be accessible on the ministry's website and also published as a monthly physical booklet every month. Commerce secretary Sunil Barthwal confirmed that the initiative will be rolled out next month, but did not offer details. A ministry spokesperson didn't respond to emailed queries. Proactive decision-making 'This marks a clear shift toward proactive and intelligent trade policymaking," one of the two people cited earlier said. 'The feature is built to enhance inter-ministerial coordination and provide policymakers with timely, actionable insights tailored to their respective sectors," the person added. India's model draws from global best practices such as the US International Trade Commission's sectoral monitoring system, China's AI-driven demand tracking, and the EU's expansive trade surveillance framework. Initially, it will be available only for policymakers, but will open to the wider public later. The system will flag sectors with flat or declining exports, monitor global trade policy shifts, and identify early signs of disruption or opportunity. 'Timely move' Global Trade Watch is designed to support timely, data-driven policy responses to changing trade winds. The rollout comes at a time of geopolitical tensions, tariff realignments, and shifting supply chains. The plan is timely and welcome, said Ajay Sahai, director general, Federation of Indian Export Organisations (FIEO). "In an era of dynamic shifts in global trade, having a credible, data-driven platform to track developments, trends, and policies will be invaluable for exporters, policymakers, and analysts alike. This initiative promises to bring greater transparency, foster informed decision-making and strengthen India's integration with global markets," he said. The platform will issue general and sector-specific alerts, including notifications on policy changes in key markets, developments related to free trade agreements, commodity-specific shifts, and geography-based risks. Staying informed 'Unlike static dashboards, Global Trade Watch will deliver sharper, policy-relevant signals that go beyond surface-level data," the person mentioned earlier said. Initially, access will be restricted to line ministries and government departments, with wider access for exporters, investors, and industry associations expected thereafter. 'It will enable ministries to track trade policy shifts across countries, monitor changes affecting specific products, and assess their strategic implications, whether by region, commodity, or trade bloc," the person said. It will also monitor global supply chain disruptions, such as export restrictions on critical minerals, and assess their implications for India. "This will enable ministries involved in policy-making to stay informed about developments relevant to their sectors, be it in terms of geography, product categories, or areas of strategic interest," the person mentioned above added. Emerging opportunities Global Trade Watch will also highlight emerging opportunities arising from changes in free trade agreements (FTAs), trade restrictions, tariff surges, or shifts in geopolitical alignments. Line ministries will receive alerts relevant to their respective import councils, allowing them to assess risks and take corrective steps. It will also track policy shifts and decisions at the World Trade Organization (WTO), enabling a comprehensive understanding of evolving multilateral trade rules, the second person mentioned above said. 'Given the growing uncertainty in global tariffs, particularly due to US policy moves, Global Trade Watch will keep stakeholders informed on how such changes affect India and its trading partners," said the person mentioned above. 'Since the commerce ministry leads most of the bilateral and multilateral negotiations, the insights will be presented in a simplified, digestible format to help policymakers across sectors act swiftly and with clarity," the person added. Market trends Exporters welcomed the initiative. Vipul Shah, former chairman of the Gems & Jewellery Export Promotion Council and managing director of Asian Star Co., said the upcoming feature could improve strategic planning. 'Global Trade Watch will help in understanding evolving market trends, especially in key export destinations," Shah said. 'With timely and structured data, exporters will be better equipped to assess demand patterns, identify emerging opportunities, and plan their export strategies more effectively," he added. However, some trade experts remain cautious. Pankaj Chadha, chairman of Engineering Export Promotion Council and managing director of Jyoti Steel Industries said while the feature is a good initiative, the accuracy of the data will be a critical factor. "If the data isn't reliable, then we are all basing our strategies on something that may not reflect the real picture. However, if the data is accurate, I think it will be a very valuable tool for the industry," Chadha added.
Mint
11-07-2025
- Business
- Mint
India buys more Russian oil—but its rupee-rouble plan isn't working
New Delhi: A rupee-settlement mechanism rolled out in 2022 to ease trade with sanction-hit countries has failed to gain traction with India's largest crude supplier—Russia. Indian refiners continue to source Russian crude supplies through traders based in the United Arab Emirates and settle transactions in dirhams. Most transactions for crude oil supplies are executed via West Asia-based traders rather than through a direct bilateral payment system between Indian and Russian entities, according to two people familiar with the matter, who spoke on the condition of anonymity. 'There was a payment issue, which has been sorted out now. Payments have been happening in AED (UAE dirham) because Indian state-run refiners are primarily buying it from the traders and most of them are UAE-based," said one of the people cited above. 'Also, even if the Russians give their crude oil for sale to a trader, they earmark it for a particular company. This is something specific to them. Also, the discounts on Russian oil have come down." Ajay Sahai, director general & CEO of the Federation of Indian Export Organisations (FIEO) said, 'While the Rouble is not freely convertible, the Dirham is both freely convertible and directly pegged to the US Dollar, offering greater ease in international transactions." In the case of oil imports from Russia in rouble, exporters often incur losses due to the need for double currency conversion—from rupee to dollar, and then from dollar to rouble, Sahai said. Transactions in dirham eliminate this additional cost due to its convertibility and stable linkage to the dollar, he said. "Moreover, Russia has significant financial investments in the UAE, particularly in sovereign bonds and real estate. Settling export payments in Dirham allows them to accumulate a currency that aligns with their investment interests," Sahai said. India's experience shows it is difficult to make an alternative for the dollar to work because of the complexities of global trade. On top of that, US President Donald Trump has now warned Brics nations of higher tariffs if the bloc seeks an alternative to the dollar. Spot purchases rule India currently has no long-term crude oil supply agreement between Russian oil majors such as Rosneft and Indian state-run refiners including Indian Oil Corp. Ltd (IOCL), Hindustan Petroleum Corp. Ltd (HPCL) and Bharat Petroleum Corp. Ltd (BPCL). The bulk of Russian oil is being procured via spot deals through traders. 'In the absence of long-term deals with state-run Indian refiners, spot purchase of oil is largely done via traders in Dubai and the payments are mostly made in AED," the person added. Russia emerged as India's top crude supplier after the 2022 invasion of Ukraine, as deep discounts spurred demand. Russian oil's share in India's import basket surged from around 2.5% in fiscal year 2021 (FY21) to 36% in FY25. However, the discounts have narrowed—from about $30 per barrel in 2022 to $2.5-4 per barrel now as international oil prices have declined. Reliance Industries Ltd was the last Indian company to sign a long-term crude deal with Rosneft—a 10-year supply agreement inked in December 2024. Talks of a consortium of Indian state-run refiners resuming negotiations surfaced earlier this year, after fresh sanctions were imposed on some Russian oil producers and vessels in January. IOCL had in 2023 signed a deal to raise oil imports from Rosneft. In 2021, the company signed a deal to buy up to 2 million tonnes of crude oil from Rosneft by the end of 2022. In April-May this year, India imported $9.1 billion worth of oil from Russia, down 9.81% from $10.15 billion in the year-earlier period. A G7-led price cap of $60 per barrel remains in place for Russian oil exports to curb Moscow's wartime revenues while protecting energy access for low- and middle-income nations. Yuan trumps rupee Experts say another reason the rupee-rouble mechanism hasn't taken off is because Russia has limited use of the Indian currency. 'The Russians want hard currency. If they export more to India than they import, they end up with a pile of rupees that can't be freely exchanged in international markets. That carries a risk of value erosion over time," said India's former commerce secretary Anup Wadhawan. 'Iran had accepted rupee payments in Indian banks earlier when they were under sanctions. But Russia is in a different situation. They aren't willing to accept rupees in large volumes because they're looking for usable currency, not blocked balances in Indian banks," he added. In FY25, India's total imports from Russia stood at $63.84 billion, of which nearly 78% was oil. Crude oil imports alone rose to $50.28 billion, up 8.16% from $46.48 billion the previous year. 'US sanctions on Russia have made most banks wary of engaging in rupee-rouble transactions. Even trade routed through Russian banks remains limited, primarily due to a significant trade imbalance in Russia's favour," said Bipin Sapra, partner and leader, indirect tax and economic policy, EY India. 'As a result, more widely accepted currencies, such as the AED, are increasingly being used to settle payments." However, Prashant Vasisht, senior vice president and co-group head, corporate rating,Icra Ltd., said with Russia's larger trade volumes with China, 'there are more use cases for reserves of yuan, which makes the Chinese currency more attractive for non-dollar transactions". Imports stay strong Despite the absence of long-term crude supply agreements with Russian majors, Indian imports remain strong. Indian state-run firms, including Indian Oil, have been in talks with Rosneft, but an agreement has yet to materialize. Asked in an interview withMintwhether talks with Rosneft for a long-term deal had resumed, Indian Oil chairman Arvinder Singh Sahney said: 'In this crude business there is no stoppage or starting of any dialogue or any because we are constantly in touch with all of them. We are in touch with all them and they are in touch with us because it's a constantly evolving business." India, a key refining hub in Asia, currently operates 23 refineries with an installed capacity of over 258 million tonnes per annum (mtpa) and plans to expand this to 310 mtpa by 2028. Its crude oil and petroleum product imports jumped 29.5% to $209.57 billion in FY25. Indian firms—ONGC Videsh Ltd, Bharat Petroresources Ltd, IOCL and Oil India Ltd—have invested nearly $16 billion in Russian oil and gas assets, including Sakhalin-1, Vankor, Taas-Yuryakh and the Siberian deposits of Imperial Energy Corp. Plc. S&P Global Commodity Insights on Thursday said that Russia retained its position as India's top crude supplier in January-June period with shipments of 1.67 million barrels per day, compared to 1.66 million barrels per day a year earlier. 'With a modest level of Russian imports in the early months of 2025, volumes are rising again, supported by lower crude prices that enable higher volumes to be procured below the price cap," said Abhishek Ranjan, South Asia oil research lead at S&P Global Commodity Insights. 'As the global oversupply is expected to continue putting pressure on prices, we expect Russian flows to remain at current levels, if not increase."
Hans India
08-07-2025
- Business
- Hans India
Indian exporters hail US decision to extend tariff hike deadline to August 1
New Delhi: Indian exporters have welcomed the US decision to postpone the tariff hikes on imports from July 9 to August 1, as this will allow more time for talks to sort out the trade issues. Director General of the Federation of Indian Export Organisations (FIEO) Ajay Sahai said that this deferment of the imposition of reciprocal tariffs reflects the US's willingness to engage constructively with its trading partners. "It provides an extended window for dialogue, which can help our negotiators to sort out remaining contentious issues," he pointed out. Sahai further stated that the proposed tariffs, covering a dozen countries, may provide India with more comparative advantage if it finalises a BTA (bilateral trade agreement) with the US, at least on goods, by the end of this month. United States' Treasury Secretary Scott Bessent earlier said that Washington is close to reaching agreements on several trade deals as "a lot of proposals" have poured in from various countries at the last minute. His comments hint at several big trade deal announcements by the Donald Trump administration. "So my mailbox was full last night with a lot of new offers, a lot of new proposals…It's going to be a busy couple of days," he told CNBC. "President Trump's going to be sending letters to some of our trading partners saying that, if you don't move things along, then on August 1, you will boomerang back to your April 2 tariff level. So I think we're going to see a lot of deals very quickly," Bessent said, according to media reports. Trump has announced a number of trade deals, including with Vietnam and China. He had stated last month that the US and India 'may sign an agreement that will open up India for US goods. India's high-level official delegation, led by chief negotiator Rajesh Agrawal, has returned from Washington after the trade talks with US officials without reaching a final agreement on the sensitive issue of trade in agricultural and dairy products that the US is pushing for. However, there is still a glimmer of hope that an interim bilateral trade agreement may be reached at the highest political level in the two countries before the deadline for the 26 per cent hike in US tariffs on Indian exports kicks in. The US is seeker greater access for its agricultural and dairy products, which is a major hurdle, as for India, this is a livelihood issue of the country's small farmers and hence a sensitive area. India is looking to secure significant tariff concessions for its labour-intensive exports such as textiles, leather and footwear.
Time of India
08-07-2025
- Business
- Time of India
Donald Trump tariffs: Relief for Indian exporters as US delays deadline; interim trade deal talks continue
AI image The United States has extended the suspension of its April 2 reciprocal tariffs until August 1, offering Indian exporters a temporary reprieve and giving negotiators more time to resolve pending issues under an interim trade deal. India, which is in advanced talks with Washington to secure a bilateral trade agreement, was notably absent from the list of countries that received tariff notification letters on Monday. The Trump administration issued these letters to over a dozen nations, including Japan, South Korea, Bangladesh, Malaysia, and South Africa, saying that new tariffs will take effect from August 1. The White House said the decision to defer implementation was taken "based on additional information and recommendations from various senior officials, including information on the status of discussions with trading partners." The earlier suspension, announced through Executive Order 14266, was to expire on July 9. India had been listed among countries targeted for reciprocal tariffs, set at 26%, in the original April 2 announcement. However, a 90-day window was provided to allow trading partners to negotiate potential resolutions. The new extension offers around three more working weeks for dialogue. Exporters in India welcomed the move. "It provides an extended window for dialogue, which can help our negotiators to sort out remaining contentious issues," said Ajay Sahai, director general of the Federation of Indian Export Organisations (FIEO), as per news agency PTI. He added that the imposition of tariffs on other countries could also offer India a comparative trade advantage if it finalises a goods-focused bilateral trade agreement by the end of July. Experts echoed similar sentiments. 'I see this as a relief for us and this response has come due to India taking a strong stand on certain issues,' said international trade expert Biswajit Dhar. Mumbai-based exporter Sharad Kumar Saraf, however, remained cautious and was quoted as saying by PTI, "The period of tariff suspension is very small. Indian exporters should explore new markets to increase exports.' He added that US President Donald Trump is "very unpredictable." India and the US aim to finalise the first tranche of their bilateral trade pact by September or October, with officials confirming that India's position on key issues has already been conveyed to Washington. "The ball is now in their court," a government official said. The US has been India's top trading partner since 2021-22. In 2024-25, bilateral trade in goods stood at $131.84 billion, including $86.51 billion in exports and $45.33 billion in imports, yielding India a surplus of $41.18 billion. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
NDTV
03-07-2025
- Business
- NDTV
Mini Trade Deal With US In 48 Hours, India Pushing For Concessions: Sources
Washington: An interim trade deal between India and the United States is likely to be finalised in the next 48 hours, with negotiations underway in Washington, sources told NDTV on Thursday. India's trade team extended its stay in Washington last week to iron out key differences as the two sides look to clinch a mini deal before the July 9 deadline when the pause on US tariffs is set to be lifted. Both sides have dug in their heels over a number of issues, including Washington's demand that India open its market to genetically modified crops - a long-standing red line for New Delhi due to risks to its farmers. The US is also pressing for greater market access to the Indian agricultural and dairy sectors. However, sources told NDTV Profit that both these sectors are likely to be kept out of the purview of the proposed deal due to concerns over rural livelihoods and food safety. India, on the other hand, is reportedly pushing for meaningful tariff concessions on its labour-intensive exports like footwear, garments, and leather, which are major job creators. New Delhi is unwilling to sign a deal that doesn't address both sectoral access and reciprocal tariffs on its exports, with negotiators maintaining that without broader tariff cuts, especially on high-employment goods, the goal of doubling bilateral trade to $500 billion by 2030 is unrealistic. "Our estimate is that once the Interim India-US Trade Deal is finalised, Indian exports to the US will double within the next three years," Federation of Indian Export Organisations (FIEO) CEO Ajay Sahai told NDTV. Per the NDTV profit report, the focus of the deal has narrowed to reciprocal tariff reductions or removals, as officials have called on both nations to prioritise lowering overall duty barriers. On Tuesday, US President Donald Trump reaffirmed that India-US will soon strike a trade deal with "much less tariffs", allowing both countries to compete. "I think we are going to have a deal with India. And that is going to be a different kind of a deal. It is going to be a deal where we are able to go in and compete. Right now, India does not accept anybody in. I think India is going to do that, and if they do that, we are going to have a deal for much less tariffs," Trump said. India-US Trade Deal India and the US have been negotiating over a Bilateral Trade Agreement (BTA) before the return of suspended 26 per cent reciprocal tariffs after the critical pause is lifted. These punitive measures, imposed initially during the Trump administration on April 2, were temporarily suspended for 90 days but will automatically resume if no agreement is reached. "The failure of these trade discussions would trigger the immediate reimplementation of the 26 per cent tariff structure," a senior official told news agency ANI. However, some sources said that even if a deal is not finalised, India won't suffer much because a 26 per cent tariff is low compared to our competitors. India's hardened position reflects the politically sensitive nature of its agricultural sector. The country's farming landscape is dominated by small-scale subsistence farmers with limited land holdings, making agricultural concessions particularly challenging from both economic and political perspectives. India has also never opened its dairy sector to foreign competition in any previous free trade agreement -- a precedent it appears reluctant to break even under US pressure.
