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The Hindu
28-05-2025
- Business
- The Hindu
Increased outward FDI by Indian companies ‘warrants attention': Finance Ministry
Even as Indian companies turn 'cautious' on investing within the country, and the global economic scenario remains uncertain, the increased outward foreign direct investment by Indian companies 'warrants attention', the Ministry of Finance has noted in a new report. The Hindu had previously reported how the Reserve Bank of India's data showed that, in 2024-25, Indian companies invested a total of $29.2 billion in other countries, 75% higher than the previous year, which was a major contributor towards India's net foreign direct investment (FDI) figure falling 96% to just $0.4 billion. 'That Indian overseas direct investment increased nearly by $12.5 billion during the year FY25, even as uncertainty reigned in the world, warrants attention, especially given their cautious attitude towards domestic investment,' the Department of Economic Affairs of the Ministry of Finance noted in its Monthly Economic Review (MER) released on Tuesday (May 27, 2025). Data from the private sector database Centre for Monitoring Economy (CMIE) shows that the Indian private sector is indeed turning more cautious about its plans, as exhibited by a rising ratio of projects cancelled versus new ones announced. Analysis by The Hindu of the CMIE data shows that the ratio of dropped projects to new project announcements by the Indian private sector — where a higher ratio indicates higher caution — has risen steadily to 36% in 2024-25 from 30.8% in 2023-24, and 21.8% in 2022-23. This rising trend breaks a streak where this ratio had been falling since 2018-19. This cautious approach is confirmed by the latest Forward-Looking Survey on Private Sector Capex Investment by the Ministry of Statistics and Programme Implementation (MoSPI), cited in the Finance Ministry's report, which shows that Indian corporates are planning fewer investments in this financial year as compared to last year. According to this survey, Indian corporates expected to invest ₹6.6 lakh crore in 2024-25, up 57% from the ₹4.2 lakh crore of actual capital expenditure they incurred in 2023-24. However, in the current financial year 2025-26, this number is again expected to fall to ₹4.9 lakh crore, according to the survey. 'The slightly lower intended capital expenditure for FY26, though still above FY24 levels, reflects cautious planning after a strong FY25,' the MER noted. Overall, the MER said the trend indicates growing corporate confidence and a 'judicious approach to investment' in an evolving global scenario.
New Indian Express
27-05-2025
- Business
- New Indian Express
Tamil Nadu faces silent youth unemployment crisis amid unfulfilled job promises
In Tamil Nadu, we have long prided ourselves on being industrious, innovative, and aspirational. For decades, our state was a model of industrial development and social mobility — a place where hard work translated into upward progress. But today, that promise is breaking down. The unemployment crisis, especially among our youth, has become more than an economic issue — it is a quiet emergency that the current government has neither acknowledged seriously nor addressed competently. According to the Centre for Monitoring Indian Economy (CMIE), as of early 2024, Tamil Nadu's unemployment rate stood at 5.2%, higher than the national average. But statistics only reveal part of the problem. Under-employment, disguised unemployment, and the migration of skilled youth to other states and abroad reflect a growing erosion of opportunity, affecting lakhs of families. The ruling party touts its achievements through job fairs and the 2024 Global Investors Meet (GIM), claiming Rs 6.64 lakh crore in investment commitments and 14.5 lakh promised jobs. Yet, by April 2024, only Rs 13,000 crore had materialised and a mere 46,000 jobs were created — just over 3% of the original promise. These jobs, largely in MSMEs, often lack security, growth prospects, or adequate compensation. We are witnessing a dangerous gap between aspiration and accountability. The tragedy isn't just the unemployment rate — it is the collapse of public faith in government schemes as reliable engines of opportunity.
Mint
26-05-2025
- Business
- Mint
Sensex is getting older, wiser — and a bit more defensive
Effective 23 June, Sensex, the bellwether index of Asia's oldest exchange, will be sporting a few more grey hairs. A key reshuffle will see the exit of two long-standing constituents: IndusInd Bank, a private sector bank recently embroiled in governance challenges, including accounting discrepancies and suspected internal fraud, and Nestle India, the maker of popular Maggi noodles. Incorporated in 1994 and 1959 respectively, these companies are making way for even older entrants: Trent (a Tata Group company) and Bharat Electronics, both founded before 1955. Read this | Zomato upends tradition with Sensex entry This half-yearly rebalancing will tip the index's age balance towards more mature companies. Currently, about 30% of the 30-scrip index's companies are aged 54 years or above. After this reconstitution, that proportion will increase to one-third, according to a Mint analysis of data from CMIE. The share of mid-aged companies (40-53 years and 35-39 years) will remain stable at 20% and 10% respectively, while the youngest cohort--companies aged 34 years or below--will decline from 40% to 36.7%. This upcoming reshuffle also marks seven companies exiting the Sensex over the past five years, highlighting the benchmark's dynamic nature. Only eight of the original 1986 constituents remain in the index today. A dramatic overhaul in 1996 saw half the stocks replaced, ushering in a new guard. Read this | Popular Bank Nifty index might need a recast if Sebi plan takes off A defensive debut That's not all. Adding to the Sensex's evolving composition, Bharat Electronics Ltd (BEL), a prominent defence public sector undertaking, is poised to join the index. This inclusion is notable as it marks the first time a company focused solely or predominantly on defence has entered the 30-share benchmark. While Bharat Forge, a past Sensex constituent (according to data sourced from CMIE), has defence among its businesses, only about 10% of its revenues came from defence in fiscal 2024, compared to BEL's core defence operations. Read this | Bharat Electronics needs booster shot of order inflow pick-up The defence sector has recently rallied sharply, driven by increasing export growth and significant budget boosts. The current rally in defence stocks has been supported by investors anticipating greater government spending on military modernization, a response to prevailing geopolitical tensions between India and Pakistan. Also read | Nifty rejig and the problem with index-based valuation BEL's inclusion, therefore, is not merely an index rebalance but a reflection of India's strategic push towards self-reliance in defence and the sector's escalating importance in the nation's economic narrative. That said, within the Sensex's sector weightage, financial services maintain their dominance. Technology firms, on the other hand, currently grappling with a slowdown, have seen their weightage (by free-float market capitalization) decline from 17.9% to 12.6% in nearly a decade, with the auto sector also losing prominence with its weightage down from 10.8% to 6.2%.
Indian Express
26-05-2025
- Business
- Indian Express
Express view on Index of Eight Core Industries (ICI) for April 2025: If these industries are not growing fast enough, the rest of the economy is unlikely to
The Index of Eight Core Industries (ICI) for April 2025 released by the Department for Promotion of Industry and Internal Trade shows that the monthly growth rate of the index fell to a nine-month low of just 0.5 per cent. In other words, the index grew just 0.5 per cent in April this year over the same month last year. This index comprises the eight most fundamental industrial sectors of the economy — coal, natural gas, crude oil, refinery products (such as petrol and diesel), fertilisers, steel, cement and electricity (with differing weights) — and it maps the volume of production in these industries. The eight core industries comprise 40.27 per cent of the weight of items included in the Index of Industrial Production (IIP). Since these eight industries essentially serve the role of a basic and/or intermediate ingredient in the functioning of the broader economy, this index's health is important to the state of the economy. The performance in April suggests a sharp loss of growth momentum relative to the preceding months. For instance, the index had grown by 4.6 per cent in March. In comparison, data from the index shows that of the eight industries, six experienced a weakness in growth momentum. The worst affected set of industries was refinery products, which incidentally have the highest weightage in the index (almost 30 per cent), as they clocked a negative growth rate (a contraction) of 4.5 per cent; it is the poorest showing since November 2022. Crude oil and fertilisers also witnessed contraction while the electricity index grew by just 1 per cent. Apart from the data for April, also noteworthy was the data for the full financial year that ended in March. In 2024-25, the core industries index grew by 4.5 per cent; this is the slowest increase since the post-pandemic recovery in 2021-22. At one level, the slowdown in April is understandable. The global economy received the shock of President Donald Trump's reciprocal tariffs and the ensuing surge of uncertainty has meant that most economic and financial metrics across the world have shown some impairment. However, the weakness, and especially the sharpness of it, and that too both in April and in the full year data for FY24, points to domestic causes as well. If these eight industries are not growing fast enough, the rest of the economy is unlikely to, either. Given the tepid start to the year, observers such as the Centre for Monitoring Indian Economy (CMIE) are dialling down the forecasts for both the June quarter as well as the full financial year. Readers and policymakers should watch out for two other data sets due to be released in days to come — the IIP and the GDP — to better understand the current state of the economy.
Indian Express
20-05-2025
- Business
- Indian Express
Labour Force Survey has an update. It's a welcome one
India's Ministry of Statistics and Programme Implementation has unveiled a new and improved version of the Periodic Labour Force Survey (PLFS) and, with that, started providing timely data on the state of the labour market. The PLFS was launched in 2017 as an annual survey to replace the quinquennial Employment-Unemployment Surveys. Up until now, apart from the annual picture of India's unemployment, PLFS would provide a quarterly update, but only for urban areas. Last week, the MoSPI shared the first-ever monthly PLFS data — for April. Shifting to a monthly reporting cycle promises a salutary effect on policy evaluation. In the past, timely official data was scarce — to find out the impact on unemployment of, say, a pandemic-induced lockdown or a disruption like demonetisation. Some private agencies, such as the CMIE, have long been providing monthly, and even weekly, data, but such data has been challenged. The PLFS has been revamped beyond just improving its frequency. For one, the sample design has been improved and the sample size enlarged. The sample size for each round of survey will now be 2,72,304 households — a 2.65 times increase in sample households to be covered in the PLFS compared to the number of sample households covered up to December 2024. The district has been made the primary geographical unit — to ensure sample observations from most of the districts in the PLFS sample, which, in turn, will improve the representativeness of the estimates. Also, notably, the annual reporting period has been aligned to the calendar year, beginning with January 2025 instead of July-June. This shift will enable timely updation of India's labour market statistics in the databases maintained by the international agencies. These changes in the PLFS's methodology and frequency are welcome. As India's economy grows and seeks global investors, credible and timely data will be non-negotiable. The current data on the Indian labour market leaves a lot to be desired. For instance, according to the April data, while the overall unemployment rate in India is 5.1 per cent, it rises to 6.5 per cent when one looks at urban areas, and to 8.7 per cent when one looks at female unemployment in urban areas. The most worrisome news pertains to youth (15-29 years) unemployment, which stands at 13.8 per cent all-India, rises to 17.2 per cent in urban areas, and further to 23.7 per cent for young urban women.
