Budget 2026 sticks to fiscal discipline, shuns populist measures despite five key state elections coming up, but ends up rattling stock markets with a higher transaction tax on derivatives trading.
India's exports rose 6.7 per cent to $35.1 billion in August annually, while imports declined 10.12 per cent to $61.59 billion, according to government data released on Monday. Gold imports were down nearly 56 per cent in August, helping to trim merchandise trade deficit to $26.49 billion in August, as against $35.64 billion in the year-ago month.
A team of US officials is expected to visit India in the coming weeks for the next round of discussions on the proposed interim trade agreement between the two countries, sources said. The visit gains importance as India and the US are likely to agree on an interim trade agreement before July 9, with New Delhi pushing for full exemption from the 26 per cent reciprocal tariff on domestic goods.
Real GDP growth surprised on the upside in 2025, but weaker nominal growth, trade uncertainty, and soft demand signal a bumpier road ahead.
Barring rice, spices, iron ore and pharmaceuticals, all the remaining 26 key sectors registered negative growth in May. Imports too plunged 51 per cent to $22.2 billion in May.
New investors should enter gradually and with a long horizon. 'Staggered investment through systematic purchase plans is advisable rather than lump-sum buying.'
The trade deficit has widened by 61 per cent to touch $25,619.85 million in the first four months of the current fiscal, against $15,841.22 million a year ago, according to official figures.
Exports in May 2012 stood at $24.77 billion.
Notwithstanding global headwinds, the Indian economy saw further momentum in October on the back of goods and services tax (GST) rate rationalisation and festival spending, as indicated by high-frequency indicators, the Reserve Bank of India's (RBI's) monthly State of the Economy report said.
In dollar terms, exports declined by 33.3 per cent over March 2008, the largest monthly decline yet. For the year as a whole, exports came in at $168.7 billion, significantly short of the original target of $200 billion and also below the revised range of $170-175 billion.
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Prime Minister Narendra Modi and Chinese President Xi Jinping vowed to work towards a "fair, reasonable, and mutually acceptable" resolution of the festering boundary issue and pledged to work towards stabilising global trade.
Merchandise exports to the US jumped 23.5 per cent year-on-year (Y-o-Y) to $8.3 billion in June, even as India's overall outbound shipments witnessed contraction during the month, according to the data released by the commerce department on Tuesday. The increase in outbound shipments to the US was largely driven by the rush among exporters to utilise America's pause on its plans to impose country-specific reciprocal tariffs.
Imports too tumbled by 58.65 per cent to $17.12 billion in April from $41.4 billion in the same month last year, according to the data by the commerce and industry ministry.
Sustaining 8 per cent-plus growth rates is necessary if we are to reach high-income status by 2047, points out Amitabh Kant.
The White House trade advisor's remarks came on a day US President Donald Trump announced that India and the US are continuing negotiations to address the trade barriers.
US President Donald Trump expresses frustration with the lack of progress in trade talks with India, imposing a 25% tariff. The move comes amid concerns over trade deficits and India's reliance on Russian military equipment and energy.
'Calibrated depreciation will help rebalance external fundamentals, offset some of the tariff differentials with competitors, improve the competitiveness of domestic substitutes vis-a-vis Chinese imports, and contribute to the easing of financial conditions at a time when the inflation rate is unusually low,' explains Sajjid Z Chinoy, head of Asia Economics at JP Morgan.
Indian and US officials will begin deliberations on the proposed bilateral trade agreement in Washington from Wednesday with an aim to iron out issues and give an impetus to the negotiations.
China has made serious inroads into Latin America, which the US may now be hinting is simply not ok: Stay in your lane, Xi! In simple terms, China will no longer have access to Venezuelan oil, points out Rajeev Srinivasan.
'Rate cut looks unlikely and there is reason to believe that the cycle is over.'
'When markets go into a budget with excessive optimism, the risk of disappointment is higher.'
'This Budget has a one-year agenda, which you can call the sprint, and the marathon is towards Viksit Bharat.'
'A breakout above 158,000 to 160,000 could trigger the next leg higher toward 165,000 to 170,000.'
Prime Minister Narendra Modi and Chinese President Xi Jinping held bilateral talks focusing on economic ties and global stability amid trade tensions and the aftermath of the Ladakh border row.
Finance Minister Nirmala Sitharaman's biggest challenge will be to find a new growth driver, particularly against the backdrop of a global economy ravaged by heightened uncertainty and fragmentation, financial markets on a precipice, and global commodity prices on a continued uptrend.
After the last Budget's announcement of a major tax relief for those earning an annual salary of less than Rs 12 lakh, there is not much that individuals can look forward to in the forthcoming Budget, points out A K Bhattacharya.
'Economic activity appears to have peaked in the second quarter of FY26, with industrial output, exports, and business confidence all softening from October 2025.'
The rupee recovered 55 paise from its all-time low level to close at 90.38 against the US dollar after a volatile trade on Wednesday, amid suspected aggressive central bank intervention.
The country's exports grew 5.37 per cent year-on-year to $27.24 billion in January 2021, mainly driven by healthy growth in pharma and engineering sectors, according to provisional data of the commerce ministry. Trade deficit during the month narrowed to $14.75 billion from $15.3 billion in January 2020. It was $15.44 billion in December 2020. Imports in January 2021 rose 2 per cent to $42 billion.
Strong domestic growth will continue to draw foreign investment into the Indian economy, Reserve Bank of India (RBI) Governor Sanjay Malhotra said on Tuesday. He said this was reflected in recent free trade agreements and investment commitments by large technology companies.
'We kept this Budget on a larger plank, rather than on one incident, however serious.'
This is the first Budget in my memory of Budgets over the last half a century which has embraced upfront, enthusiastically and emphatically, technology, modernity and fiscal sobriety, notes Shreekant Sambrani.
India's high cost of capital due to relatively shallow corporate bond markets, limited institutional investor depth, sovereign risk premia, and regulatory restrictions on capital flows, is a constraint on private investment and long-run growth, the Economic Survey, authored by Chief Economic Advisor (CEA) V Anantha Nageswaran, said.
India's absolute dominance at home will come under examination when they meet a determined New Zealand in the decisive third ODI at the high-scoring Holkar Stadium in Indore on Sunday, with the three-match series locked at 1-1.
India and Russia have solidified a five-year plan to enhance their economic and trade partnership, while also addressing the ongoing conflict in Ukraine and the threat of terrorism.
On Friday, during the weekly media briefing, MEA spokesperson Randhir Jaiswal, when asked about media reports that some Indian oil companies have stopped taking oil from Russia, had said India has made clear its approach on the issue.
Reiterating Sitharaman's statement that this is a youth power budget, Modi emphasised that the provisions made in the budget will prepare leaders, innovators and creators across different sectors.
A team of senior officials from India will again visit Washington this month to hold discussions with their US counterparts on the proposed bilateral trade agreement (BTA), government sources said on Thursday. To give impetus to the talks, India's chief negotiator Rajesh Agrawal, special secretary in the Department of Commerce, and Assistant US Trade Representative for South and Central Asia Brendan Lynch had last month held three-day talks in Washington.
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