India’s services sector, a critical driver of the economy, demonstrated resilience in November despite inflationary challenges. The HSBC India Services Purchasing Managers’ Index (PMI), compiled by S&amp;P Global, slipped marginally to&nbsp;58.4&nbsp;from October’s 58.5 but remained comfortably above the&nbsp;50-point threshold&nbsp;for over 40 months, signaling continued expansion.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;<h2>Robust Yet Moderating Growth</h2>While total sales rose at a rate&nbsp;four points above the long-term average, new orders and output growth slowed. Export orders from Asia, Europe, Latin America, and the US grew at their fastest pace in three months, though they remained below mid-year levels.<h3>Record Job Creation Amid Confidence</h3>Employment surged, registering the&nbsp;fastest growth since the survey began in 2005, fueled by robust business confidence, growing new orders, and international demand. However, this growth came amid escalating price pressures.<h3>Inflationary Challenges</h3>Input and output prices climbed at their steepest rates in 15 months and nearly 12 years, respectively, driven by high food and labor costs. Service providers faced sharper cost pressures compared to manufacturers, leading to higher selling prices.Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Educatio</a>n<h3>Economic Context</h3>India’s economy expanded&nbsp;8.2% in FY24, surpassing the Reserve Bank’s 7% projection. However, GDP growth slowed to&nbsp;6.7% in Q1 FY25&nbsp;and further to&nbsp;5.4% in Q2 FY25&nbsp;due to weakening manufacturing and urban consumption.<h3>Manufacturing and Composite Output Trends</h3>The HSBC India Manufacturing PMI eased to&nbsp;56.5&nbsp;in November, marking an 11-month low. Consequently, the Composite Output Index, combining services and manufacturing, fell to&nbsp;58.6&nbsp;from October’s 59.1, reflecting broad economic moderation.OutlookThe services sector continues to be a cornerstone of India’s economy, contributing over&nbsp;50% to GDP. Policymakers must address inflationary pressures to sustain growth while leveraging the sector’s strong demand and historic employment gains. India’s services sector stands resilient, but balancing growth with inflation management will be key to maintaining momentum in the months ahead.Also Read: <a href="https://www.sovrenn.com/knowledge/gst-hike-on-tobacco-aerated-beverages-new-35-slab-proposed">GST Hike on Tobacco, Aerated Beverages: New 35% Slab Proposed</a>

Explore India's services sector growth amidst rising cost pressures. Discover key insights into its resilience and performance in the face of challenges.

India’s Services Sector: Growth Holds Firm Amid Cost Pressures

The Group of Ministers (GoM) has recommended increasing the GST on cigarettes, tobacco, and aerated beverages from&nbsp;28% to 35%, marking the introduction of a fifth GST slab. This move aims to boost revenue and curb the consumption of demerit goods. The proposal, led by Bihar Deputy Chief Minister Samrat Chaudhary, will be presented to the GST Council on&nbsp;December 21, 2024.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;<h2>Proposed GST Changes</h2><h3>New 35% Slab</h3><ul><li>Applicable to&nbsp;tobacco products,&nbsp;cigarettes, and&nbsp;aerated beverages.</li></ul><h3>Apparel</h3><ul><li>Below ₹1,500: No change (5% GST).</li><li>₹1,500 to ₹10,000: Hiked to&nbsp;18%.</li><li>Above ₹10,000: Increased to&nbsp;28%.</li></ul><h3>Other Key Changes (October 2024 Proposal)</h3><ul><li>Packaged drinking water (20+ litres): Reduced to&nbsp;5%&nbsp;(from 18%).</li><li>Bicycles under ₹10,000: Reduced to&nbsp;5%&nbsp;(from 12%).</li><li>Shoes over ₹15,000: Increased to&nbsp;28%&nbsp;(from 18%).</li></ul>Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Educatio</a>n<h2>Impact Analysis</h2>1. Revenue Boost: Higher tax on luxury and demerit goods is expected to enhance the government's fiscal position.2. Consumer Behavior: Likely to discourage consumption of products like tobacco and sugary beverages.3. Business Impact: Industries producing demerit goods may face reduced demand, while affordable goods manufacturers could benefit.<h2>Next Steps</h2>The GST Council will review and finalize these proposals in its December 21 meeting. The council may also retain the GoM for periodic rate rationalization, ensuring alignment with fiscal and socio-economic objectives.This hike reflects the government’s commitment to balancing revenue generation with public welfare, making it a key development in India’s tax policy landscape.Also Read: <a href="https://www.sovrenn.com/knowledge/raghuram-rajan-warns-us-public-debt-a-growing-vulnerability">Raghuram Rajan Warns: US Public Debt a Growing Vulnerability&nbsp;</a>

India's Group of Ministers proposes a GST hike on cigarettes, tobacco, and aerated beverages from 28% to 35%, introducing a fifth GST slab to boost revenue and reduce demerit goods consumption. The proposal will be presented to the GST Council on December 21, 2024.

GST Hike on Tobacco, Aerated Beverages: New 35% Slab Proposed

<h2>Factory activity at 11-month low in November amid cost pressure</h2>India's manufacturing sector showed signs of a slowdown in November, with growth easing to its weakest level in 11 months due to mounting price pressures and softer domestic demand. The latest data from the HSBC India Manufacturing Purchasing Managers Index (PMI) highlighted a nuanced picture of the sector, balancing domestic challenges with robust export demand.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;<h3 style="margin-left:0px;text-align:justify;">PMI Indicates Slower Expansion</h3>The HSBC India Manufacturing PMI, compiled by S&amp;P Global, dipped to 56.5 in November, down from 57.5 in October. While still above the critical 50-point threshold that signifies expansion, the reading was the lowest since September and below the preliminary flash estimate of 57.3.The PMI has consistently remained above its long-term average for nearly three years, reflecting overall resilience in India’s manufacturing landscape. However, November’s data underscores a deceleration in factory orders and production.<h3>Price Pressures Erode Domestic Demand</h3>Input costs surged at the fastest rate since July, driven by rising prices for key materials such as chemicals, cotton, leather, and rubber. Consequently, manufacturers raised output prices at the sharpest rate since October 2013, transferring increased costs of freight, labour, and raw materials to consumers.Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Educatio</a>n<h3>Export Orders Offer a Silver Lining</h3>Despite domestic headwinds, export demand surged in November, with new export orders reaching a four-month high. Indian manufacturers saw increased orders from key markets, including the US, Japan, China, and Italy.<h3>Government’s Vision: A $10 Trillion Economy</h3>India’s ambition to become a $10 trillion economy within the next decade hinges heavily on a robust manufacturing sector. The government has ramped up capital expenditure to enhance infrastructure, create jobs, and invigorate industrial activity. Focus areas include semiconductors, renewable energy, and electric vehicles, crucial to the nation’s long-term economic growth.<h3>Improved Demand Outlook for 2025</h3>The Reserve Bank of India’s (RBI) maintained GDP growth projection of 7.2% for FY25 reflects confidence in the strength of rural and urban demand. Factors such as a favourable monsoon and a post-festival consumption boost are expected to sustain momentum.Survey findings revealed manufacturers replenishing input stocks at a pace above historical averages, indicating cautious optimism. Additionally, finished goods inventories, which had been in decline since 2017, stabilized in November.<h3>Navigating Challenges in 2024 and Beyond</h3>While India's manufacturing sector continues to expand, the pace of growth is tempered by intensifying price pressures and domestic competition. Business leaders remain optimistic about the future, banking on capacity expansion, marketing initiatives, and new product launches to drive demand in 2025.&nbsp;Also Read:<a href="https://www.sovrenn.com/knowledge/india-s-cooperative-sector-to-generate-over-11-crore-jobs-by-2030"> India’s Cooperative Sector to Generate Over 11 Crore Jobs by 2030&nbsp;</a>

India's manufacturing sector saw a slowdown in November, with growth hitting its weakest level in 11 months due to price pressures and weaker domestic demand, while export demand remained strong, according to HSBC's PMI data.

India’s Manufacturing Growth Slows to 11-Month Low in November Amid Price Pressures

<h2>India's cooperatives may add over 11 crore jobs by 2030</h2>India's cooperative sector is set to play a transformative role in the nation’s employment landscape, with the potential to create 5.5 crore direct jobs and 5.6 crore self-employment opportunities by 2030, according to a report by management consultancy firm Primus Partners.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;<h3>Steady Employment Growth</h3>The&nbsp;Indian Cooperative Movement&nbsp;report highlights the sector’s impressive progress, with jobs increasing from 1.2 million in 2007-08 to 5.8 million in 2016-17—a staggering 18.9% annual growth rate. This trend underscores the sector’s ability to provide stable employment while driving inclusive economic development.<h3>Catalyst for Self-Employment</h3>Cooperatives have also emerged as a major driver of self-employment. Opportunities doubled from 15.47 million in 2006-07 to 30 million by 2018. With an annual growth rate of 5-6%, the sector is projected to generate 56 million self-employment opportunities by 2030, creating new pathways for income generation in rural and semi-urban areas.Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Educatio</a>n<h3>Boost to GDP</h3>By 2030, the cooperative sector is expected to directly contribute 3-5% to India’s GDP. Including the impact of self-employment, this contribution could exceed 10%, reinforcing the sector’s critical role in agriculture, rural industries, and small enterprises.<h3>Policy Support and Modernization</h3>The creation of the Ministry of Cooperation in 2021 marked a turning point for the sector. Focused on modernizing governance, streamlining policies, and promoting cooperative enterprises, the ministry is addressing key challenges like funding and sustainability. India’s 8.5 lakh cooperative societies, with 29 crore members, require robust policy frameworks to ensure autonomy, self-reliance, and democratic management.Looking AheadThe cooperative sector is well-positioned to be a cornerstone of India’s economic growth. With the right interventions, it could create over 11 crore employment opportunities and contribute significantly to GDP, fostering a more inclusive and sustainable economy.&nbsp;Also Read: <a href="https://www.sovrenn.com/knowledge/india-s-economic-outlook-a-cautious-optimism-amid-global-challenges">India’s Economic Outlook: A Cautious Optimism Amid Global Challenges</a>

India's cooperative sector is poised to create 5.5 crore direct jobs and 5.6 crore self-employment opportunities by 2030, transforming the nation's employment landscape, according to a report by Primus Partners.

India’s Cooperative Sector to Generate Over 11 Crore Jobs by 2030

IntroductionThe US economy grew at an annualized&nbsp;2.8%&nbsp;in Q3 2024, driven by robust&nbsp;consumer spending&nbsp;and steady&nbsp;business investments, according to the Bureau of Economic Analysis. Consumer spending, which increased&nbsp;3.5%, led the growth, although slightly revised down due to softer merchandise purchases. Business investments, especially in equipment, surged, with a&nbsp;39%&nbsp;rise in spending on computers and peripherals—the largest since 2020.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;However, nonresidential fixed investment slowed to&nbsp;3.8%, reflecting caution amid economic uncertainties. Meanwhile, trade dynamics and inventory adjustments restrained growth, subtracting&nbsp;0.57&nbsp;and&nbsp;0.11 percentage points, respectively.Inflation and Federal Reserve PolicyThe Fed’s preferred inflation metric, the&nbsp;personal consumption expenditures (PCE) price index, rose&nbsp;1.5%, while core PCE excluding food and energy climbed&nbsp;2.1%. This moderation supports the Fed’s cautious stance on interest rate cuts, balancing growth with inflation control.Labor Market TrendsInitial jobless claims remained historically low, but continuing claims hit their highest level since 2021, signaling challenges for unemployed workers finding new jobs. Despite these mixed signals, the labor market remains a key pillar of economic resilience.Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Educatio</a>nCorporate Profits and Business SentimentAfter-tax corporate profits were flat, with profit margins for non-financial corporations slightly improving to&nbsp;15.6%. Optimism around President-elect Donald Trump’s fiscal agenda, including tax cuts and trade tariffs, has buoyed stock markets. However, economists warn of potential inflationary risks from expansive fiscal policies.Government Spending BoostGovernment spending expanded&nbsp;5%, driven by a&nbsp;14%&nbsp;rise in defense outlays. This robust increase highlights fiscal priorities that supported GDP growth despite weaker trade contributions.OutlookWhile the economy remains resilient, challenges like inflation, global trade uncertainties, and labor market shifts pose risks. Policymakers must navigate these carefully to sustain growth in the quarters ahead.&nbsp;Also Read: <a href="https://www.sovrenn.com/knowledge/india-s-growth-outlook-diverging-paths-of-s-and-p-and-fin-min"><span style="background-color:rgb(255,255,255);color:rgb(32,56,94);font-family:-apple-system, &quot;system-ui&quot;, &quot;Segoe UI&quot;, Roboto, Oxygen, Ubuntu, Cantarell, &quot;Fira Sans&quot;, &quot;Droid Sans&quot;, &quot;Helvetica Neue&quot;, sans-serif;">India’s Growth Outlook: Diverging Paths of S&amp;P and FinMin</a>

The US economy grew at an annualized 2.8% in Q3 2024, driven by robust consumer spending and steady business investments, according to the Bureau of Economic Analysis. Consumer spending, which increased 3.5%, led the growth, although slightly revised down due to softer merchandise purchases. Business investments, especially in equipment, surged, with a 39% rise in spending on computers and peripherals—the largest since 2020.

US Q3 GDP Growth: Resilience Amid Challenges

Contrasting Views on India’s EconomyS&amp;P Global Ratings has lowered India’s GDP growth projections, citing high interest rates, reduced fiscal stimulus, and global headwinds. The agency now forecasts growth at&nbsp;6.8% for FY25, easing further to&nbsp;6.7% in FY26, down from earlier estimates. It highlights challenges such as subdued export demand, weaker construction activity, and geopolitical uncertainties, particularly following the US elections.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;In contrast, the Ministry of Finance remains optimistic, projecting stable growth between&nbsp;6.5% and 7%&nbsp;for FY25. It points to strong agricultural output, rising domestic demand, and resilient high-frequency indicators like the&nbsp;Purchasing Managers’ Index (PMI)&nbsp;and e-way bill generation as signs of economic stability.Decoding the DownturnS&amp;P’s report attributes the slowdown to:• High borrowing costs, curbing urban demand.• Softening fiscal stimulus&nbsp;in the post-election period.• Global trade challenges, particularly weaker export recovery amid slowing demand in developed markets.Ministry’s Cautious OptimismThe Finance Ministry highlights factors driving growth, including:• Robust agriculture, supported by favorable monsoon and increased minimum support prices.• Stable inflation trends, with early signs of easing food prices in November.Inflation and Monetary PolicyIndia’s retail inflation hit&nbsp;6.21% in October, breaching the Reserve Bank of India’s target range for the first time in over a year. Food inflation, a key contributor, surged to&nbsp;10.87%, its highest in 15 months. While this may delay rate cuts, S&amp;P anticipates just one policy rate reduction in FY25 as inflationary pressures persist.Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Educatio</a>nBalancing Global and Domestic DynamicsIndia’s export growth remains a concern, but the services sector continues to show strength. The Ministry’s confidence stems from improving domestic demand and policy measures to stabilize inflation. However, S&amp;P warns that external risks, including changing US trade policies, could weigh on growth.A Tale of DivergenceThe differing estimates reflect the balancing act between global headwinds and domestic resilience. With GDP data for Q2FY25 expected soon, the numbers will provide further clarity on India’s growth trajectory. While S&amp;P’s caution underscores external challenges, the Ministry’s optimism highlights the enduring strength of India’s domestic economy.Also Read: <a href="https://www.sovrenn.com/knowledge/centre-s-capex-target-building-momentum-amid-challenges">Centre’s Capex Target: Building Momentum Amid Challenges&nbsp;</a>

S&P Global Ratings has lowered India’s GDP growth projections, citing high interest rates, reduced fiscal stimulus, and global headwinds. The agency now forecasts growth at 6.8% for FY25, easing further to 6.7% in FY26, down from earlier estimates. It highlights challenges such as subdued export demand, weaker construction activity, and geopolitical uncertainties, particularly following the US elections.

India’s Growth Outlook: Diverging Paths of S&P and FinMin

<h2>Favorable Monsoon Conditions Boost Agricultural Prospects</h2>India’s economic outlook for the coming months remains cautiously optimistic, bolstered by promising developments in the agriculture sector. According to the&nbsp;Monthly Economic Review (October 2024)&nbsp;by the Ministry of Finance’s Department of Economic Affairs, favorable monsoon conditions, increased Minimum Support Prices (MSP), and adequate input supplies are expected to drive agricultural productivity. These factors provide a much-needed cushion for rural incomes, supporting domestic demand and keeping inflationary pressures in check.The agricultural sector remains a key driver of economic stability. However, despite positive forecasts, the ministry cautioned that fragile geopolitical conditions and supply chain disruptions could pose risks to inflation control.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;<h3>Inflation: A Persistent Challenge</h3>India’s&nbsp;Consumer Price Index (CPI) inflation&nbsp;rose to&nbsp;6.2% in October 2024, fueled by escalating prices of vegetables, oils, and fats. Notably, tomato, onion, and potato prices surged due to heavy rainfall in major producing states, disrupting supplies. This price spike was further aggravated by lower output compared to last year and diminished stock levels.<h3>Export Growth Faces Global Headwinds</h3>India’s export performance, a critical growth pillar, is encountering significant challenges. The Ministry of Finance notes that&nbsp;softening demand in developed markets&nbsp;is likely to hinder the recovery of merchandise exports. Global factors such as fluctuating interest rates, geopolitical developments, and policy shifts in key trading partners like the United States are expected to influence India’s trade dynamics.Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Educatio</a>n<h3>Services Trade: A Bright Spot</h3>Amid export challenges, India’s&nbsp;services trade&nbsp;has emerged as a resilient growth engine. The sector continues to sustain momentum, driven by strong demand for IT services, professional solutions, and outsourcing capabilities. This trend reflects India’s growing prominence in the global services economy, helping to offset some weaknesses in merchandise trade.<h3>Geopolitical Risks and Policy Implications</h3>India’s economic trajectory remains intertwined with global developments. The review emphasizes the importance of&nbsp;geopolitical stability, interest rate movements, and international policy decisions in shaping trade and capital flows. The interplay of these factors will determine the sustainability of India’s growth story in an increasingly uncertain global economic environment.Conclusion: A Delicate Balancing ActIndia’s economic outlook is a mix of cautious optimism and underlying risks. While the agricultural sector offers hope for growth and inflation management, challenges in exports and rising inflation remain significant hurdles. Policymakers must strike a balance between fostering domestic demand and navigating global uncertainties to ensure steady economic progress.With sustained focus on improving supply chain resilience, managing inflationary pressures, and enhancing export competitiveness, India is well-positioned to weather current challenges and maintain its growth momentum.&nbsp;Also Read : <a href="https://www.sovrenn.com/knowledge/u-k-economy-faces-surprise-contraction-in-september">U.K. Economy Faces Surprise Contraction in September</a>

India's economic outlook for the coming months is cautiously optimistic, supported by favorable monsoon conditions, higher MSP, and strong agricultural productivity, which are expected to boost rural incomes, domestic demand, and control inflation, as per the October 2024 Economic Review.

India’s Economic Outlook: A Cautious Optimism Amid Global Challenges

<h2>UK economy surprises with September contraction</h2>The U.K. economy experienced an unexpected contraction in September and marginal growth in the third quarter of 2024, according to data from the Office for National Statistics (ONS). These figures reveal slowing momentum following a strong start to the year.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;<h3>GDP and Sectoral Performance</h3>Gross Domestic Product (GDP) declined by 0.1% in September, against economists’ predictions of 0.2% growth. This followed modest growth of 0.2% in August. For the third quarter, GDP expanded by just 0.1%, below the forecasted 0.2% and significantly lower than the 0.5% growth in Q2.Key sector performance in September:<ul><li>Services: Grew by 0.1% in Q3, reflecting subdued activity.</li><li>Construction: Increased by 0.8%, demonstrating resilience</li><li>Production: Declined by 0.2%, offsetting gains in other areas.</li></ul>Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Educatio</a>n<h3>Inflation and Interest Rates</h3>Inflation fell to 1.7% in September, marking its first drop below the Bank of England’s 2% target since April 2021. This allowed the central bank to reduce its key interest rate by 25 basis points to 4.75% in November. However, inflation risks and global uncertainties are expected to limit further rate cuts in the near term.<h3>Fiscal Policy and Growth Projections</h3>The Labour Government's tax-focused budget is projected to boost GDP by 0.75 percentage points over the next year, as estimated by the Bank of England. Finance Minister Rachel Reeves emphasized the importance of fiscal discipline alongside investments to stabilize public finances and drive growth.<h3>Global Risks and Trade Factors</h3>Geopolitical uncertainties, including potential tariff policies under U.S. President-elect Donald Trump, add further complexity. The Bank of England acknowledged risks related to global fragmentation without committing to specific forecasts.<h3>Currency and Market Reactions</h3>The British pound remained steady against the U.S. dollar following the GDP announcement, while the euro rose 0.4% against the pound, signaling a cautious market outlook.OutlookThe U.K.’s economic growth slowed significantly in Q3, with challenges across sectors and subdued confidence levels. While fiscal measures and easing inflation may provide relief, external risks and structural imbalances remain central to the recovery trajectory.Also Read: <a href="https://www.sovrenn.com/knowledge/fed-chair-powell-stresses-caution-on-rate-cuts-amid-economic-strength">Fed Chair Powell Stresses Caution on Rate Cuts Amid Economic Strength&nbsp;</a>

The U.K. economy experienced an unexpected contraction in September and marginal growth in the third quarter of 2024, according to data from the Office for National Statistics (ONS). These figures reveal slowing momentum following a strong start to the year.

U.K. Economy Faces Surprise Contraction in September

IntroductionThe government’s capital expenditure (capex) plans for FY2025 aim to sustain economic growth through infrastructure development and innovation. With an allocation of ₹11.11 trillion, this year’s target reflects continuity in the Centre’s strategy, though utilization is projected at 95% of the target, similar to FY2024, according to Ajay Seth, Secretary, Department of Economic Affairs.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;Capex Utilization TrendsIn FY2024, ₹9.49 trillion of the revised ₹9.50 trillion target was spent, achieving 95% of the allocation. For FY2025, the government expects to utilize ₹10.55 trillion, maintaining the same efficiency. However, early spending has slowed, with Q1 FY2025 capex contracting by 35% year-on-year to ₹1.8 trillion, largely due to the general elections. State capex also declined by 21% during this period.Resilient Economic IndicatorsDespite a sluggish start to capex, key economic indicators remain strong. Private Final Consumption Expenditure (PFCE) and Gross Fixed Capital Formation (GFCF) grew by 7.4% and 7.5% in Q1 FY2025. These figures underscore robust consumer spending and investment activity, critical for sustaining growth momentum.Focus on InnovationThe ₹1 trillion&nbsp;Anusandhan National Research Fund, expected to be operational by February, is a significant initiative to boost private-sector R&amp;D. This fund aims to bridge the gap between research and industry, promoting innovation and reducing dependence on foreign technology. Defence Secretary Rajesh Kumar Singh emphasized the need for indigenous manufacturing to strengthen India’s industrial capabilities.Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Educatio</a>nGrowth OutlookThe government remains confident in achieving the Economic Survey’s 6.5%-7% GDP growth projection for FY2025, supported by the Reserve Bank of India’s estimate of 7.2%. Ajay Seth noted no downside risks, signaling optimism for economic stability.ConclusionThe Centre’s capex strategy reflects a balance of ambition and realism. While election-linked delays pose challenges, initiatives like the Anusandhan Fund and steady infrastructure investments promise long-term benefits. Delivering on these plans will be key to sustaining India’s economic growth trajectory.&nbsp;Also Read:<a href="https://www.sovrenn.com/knowledge/india-s-q3-merchandise-exports-expected-to-reach-107-5-billion-amid-modest-recovery">India’s Q3 Merchandise Exports Expected to Reach $107.5 Billion Amid Modest Recovery</a>

The government’s capital expenditure (capex) plans for FY2025 aim to sustain economic growth through infrastructure development and innovation. With an allocation of ₹11.11 trillion, this year’s target reflects continuity in the Centre’s strategy, though utilization is projected at 95% of the target, similar to FY2024, according to Ajay Seth, Secretary, Department of Economic Affairs.

Centre’s Capex Target: Building Momentum Amid Challenges

Former Reserve Bank of India Governor Raghuram Rajan has raised concerns about the mounting public debt in the United States, warning of the risks posed by fiscal complacency. Speaking at the Bancor Prize award ceremony in Rome, Rajan highlighted how high debt levels undermine a country’s ability to respond to crises and weaken global cooperation.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;<h2>A Global Debt Crisis Looms</h2>The IMF projects global public debt to reach $100 trillion by 2024, or 93% of global GDP, driven largely by the US and China. While falling inflation and interest rates offer a temporary reprieve, Rajan emphasized that governments must act now to reduce fiscal vulnerabilities.“We’ve had the global financial crisis and the pandemic,” Rajan stated, warning of more frequent emergencies in the future. “We can’t be satisfied with building up debt.”Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Educatio</a>n<h2>US Debt Trajectory: A Warning Sign</h2>The United States’ debt continues to rise, with the IMF forecasting steady growth in the coming years. Rajan urged US policymakers to take the issue seriously, describing current debt levels as a “vulnerability.” With Donald Trump set to return to the White House, the next administration will need to manage this growing burden effectively.<h2>Building Fiscal Resilience</h2>To address these challenges, Rajan proposed reforms to multilateral institutions, greater emphasis on global trade in services and climate action, and stronger international collaboration. He stressed that fiscal sustainability is critical not only for individual nations but for global stability.<h3>A Call to Action</h3>Rajan’s warning is a timely reminder that unchecked debt accumulation has far-reaching consequences. For the US and its peers, reducing debt is essential to building resilience against future crises. Acting now will ensure governments are better prepared for an increasingly uncertain world.&nbsp;Also Read:<a href="https://www.sovrenn.com/knowledge/inflation-squeezes-indian-households-as-cpi-hits-5-81-in-october"> Inflation Squeezes Indian Households as CPI Hits 5.81% in October</a>

Raghuram Rajan, former RBI Governor, warns about the risks of rising public debt in the U.S. at the Bancor Prize ceremony in Rome, emphasizing how high debt levels weaken crisis response and global cooperation.

Raghuram Rajan Warns: US Public Debt a Growing Vulnerability

<h2>Renewed Commitment to Strengthen Ties</h2>UK Prime Minister Keir Starmer has announced the revival of Free Trade Agreement (FTA) talks with India, slated to begin in 2025. This announcement followed his meeting with Indian Prime Minister Narendra Modi during the G20 Summit in Rio de Janeiro on November 18, 2024. Modi described the discussion as “extremely productive,” highlighting the importance of the Comprehensive Strategic Partnership between the two nations. The talks will focus on technology, green energy, security, and cultural linkages, areas seen as pivotal for mutual growth.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;<h3>Strategic Importance of the FTA</h3>Bilateral trade between India and the UK reached £42 billion in the 12 months ending June 2024. The proposed FTA aims to reduce tariffs, improve market access, and foster investment, potentially increasing this figure significantly. UK Business and Trade Secretary Jonathan Reynolds emphasized that India, the world’s fifth-largest economy, is a vital partner. Trade and investment between the two nations currently support over 600,000 jobs across both countries.<h3>A Long-Awaited Opportunity</h3>FTA negotiations began in January 2022 but stalled due to elections in both nations. The Labour Party’s focus on trade-friendly policies aligns with efforts to bolster the UK’s economic stability. Downing Street plans to unveil a new trade strategy emphasizing sustainable and inclusive growth to guide future negotiations.Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Educatio</a>n<h3>Key Areas of Collaboration</h3>The Comprehensive Strategic Partnership will prioritize:<ul><li>Technology and Innovation:&nbsp;Strengthening digital and AI frameworks.</li><li>Green Energy:&nbsp;Accelerating <a href="https://www.sovrenn.com/knowledge/list-of-green-energy-stocks-to-invest-in-india">renewable energy</a> transitions.</li><li>Security:&nbsp;Enhancing cybersecurity and defense cooperation.</li><li>Cultural Exchange:&nbsp;Expanding education and cultural initiatives.</li></ul>These shared priorities promise significant long-term benefits.<h3>Challenges Ahead</h3>Historical hurdles, such as tariff discrepancies, intellectual property issues, and visa regulations, remain. A balanced approach will be critical to addressing these challenges and achieving a mutually beneficial agreement.<h3>The Road Ahead</h3>Resuming FTA talks in 2025 signals a pivotal step in UK-India relations. With a combined GDP exceeding $10 trillion, both nations stand to benefit from enhanced trade, innovation, and cultural ties. The partnership reflects a shared vision for prosperity and interconnected growth, laying the groundwork for a dynamic economic future.Also Read: <a href="https://www.sovrenn.com/knowledge/india-s-q3-merchandise-exports-expected-to-reach-107-5-billion-amid-modest-recovery">India’s Q3 Merchandise Exports Expected to Reach $107.5 Billion Amid Modest Recovery</a>

UK PM Keir Starmer announces the revival of India-UK Free Trade Agreement talks in 2025 after a productive meeting with PM Modi at the G20 Summit. Key focus: tech, green energy, security, and culture.

UK and India to Revive FTA Talks: A New Era of Trade Cooperation

<h2>Powell Signals No Urgency for Rate Cuts in Robust Economy</h2>U.S. Federal Reserve Chair Jerome Powell recently emphasized that there is no immediate need to accelerate interest rate cuts due to the economy’s steady growth, low unemployment, and inflation that remains above the Fed's 2% target. Speaking at a Dallas Fed event, Powell underscored the importance of a gradual approach in adjusting rates, allowing the Fed to maintain stability without prematurely stimulating or restraining growth.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;<h3>Inflation on Track, But Patience Required</h3>Powell stated that inflation is progressing toward the Fed's 2% target, a level viewed as sustainable for the economy’s long-term health. The Fed aims to guide inflation along a "sustainable path," which will ultimately allow monetary policy to shift toward a neutral stance — one that neither stimulates nor cools down economic activity excessively. Powell’s message: patience is essential, as a rushed approach could disrupt steady progress.<h3>Economic Resilience Permits a Steady Approach</h3>With the economy showing no signs of distress, Powell argued, the Fed has room to proceed cautiously. "The economy is not sending any signals that we need to be in a hurry to lower rates," he said. This resilience, marked by solid job growth and robust consumer spending, gives policymakers the flexibility to make rate adjustments based on incoming data, rather than urgency.Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Educatio</a>n<h3>Market Reaction and Projections for Future Rates</h3>Following Powell’s remarks, yields on short-term U.S. Treasury bonds rose, with investors recalibrating expectations for future rate cuts. Currently, the Fed’s target rate is set at a range of 4.5% to 4.75%, but initial projections of the rate falling to 2.9% by 2026 are now seen as optimistic. Investors now anticipate a rate closer to 3.9% over the next few years, reflecting expectations of sustained economic growth.<h3>Gradual Path Forward</h3>As December’s Federal Reserve meeting approaches, traders expect a potential 0.25% rate cut. However, Powell’s cautious tone suggests that future adjustments will depend on how the economy performs in the coming months. This approach aligns with the Fed’s goal of avoiding abrupt shifts that could introduce financial instability.In sum, Powell’s data-driven, gradualist stance reaffirms the Fed’s commitment to steady economic growth while managing inflation. This approach supports confidence in the central bank’s ability to navigate complex economic landscapes without compromising stability.&nbsp;Also Read: <a href="https://www.sovrenn.com/knowledge/india-s-q3-merchandise-exports-expected-to-reach-107-5-billion-amid-modest-recovery">India’s Q3 Merchandise Exports Expected to Reach $107.5 Billion Amid Modest Recovery</a>

U.S. Federal Reserve Chair Jerome Powell recently emphasized that there is no immediate need to accelerate interest rate cuts due to the economy’s steady growth, low unemployment, and inflation that remains above the Fed's 2% target. Speaking at a Dallas Fed event, Powell underscored the importance of a gradual approach in adjusting rates, allowing the Fed to maintain stability without prematurely stimulating or restraining growth.

Fed Chair Powell Stresses Caution on Rate Cuts Amid Economic Strength

<h2>Modest Growth in Export Sector Despite Global Pressures</h2>India Exim Bank projects a 1.85% year-on-year increase in merchandise exports to $107.5 billion for Q3 FY25 (October-December), a rise from $104.61 billion in the same period last year. While the modest rebound underscores steady demand from key trade partners, potential global monetary easing could further support India’s export environment amid ongoing global economic uncertainty.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;<h3>Key External Risks Persist in Global Trade Environment</h3>Exim Bank highlights several risks, including geopolitical tensions in the Middle East, economic fragmentation, protectionist trade policies, and continued supply chain issues. These external factors may pose headwinds to the projected export growth, creating a cautious outlook for Indian exporters in the near term.<h3>Positive Growth for Non-Oil, Non-Gemstone Exports</h3>India Exim Bank forecasts a 7.39% increase in non-oil exports, expected to reach $91.7 billion. Non-oil, non-gems, and jewellery exports are anticipated to grow 7.8% to $82.7 billion year-on-year. These segments provide a stable base, supporting India’s trade amid fluctuating demand in commodity-based exports.Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Educatio</a>n<h3>Trade Deficit Declines, But Momentum Remains Fragile</h3>India’s trade deficit narrowed to $20.78 billion in September, its lowest level in five months, buoyed by modest export growth and a decline in imports. This deficit has fluctuated between $19.1 billion and $29.65 billion over the past six months, signaling a fragile balance that may be influenced by shifting demand and global supply chain stability.<h3>Modest Growth Across Quarters Reflects Stable Yet Limited Expansion</h3>India’s exports reached $109.11 billion in Q1 FY25 and $102.34 billion in Q2, marking slight changes from the prior fiscal year. Exim Bank’s quarterly forecasts, using the Export Leading Index model, anticipate moderate momentum into Q4, with the next projection update expected in early February.ConclusionIndia’s gradual export recovery underscores the resilience of certain sectors amid global complexities. Yet, ensuring consistent growth will require adaptive strategies to counter both external shocks and internal economic challenges. As India moves into the final quarter of FY25, export stability will depend on proactive trade policies and a close alignment with evolving global trends.Also Read:<a href="https://www.sovrenn.com/knowledge/inflation-squeezes-indian-households-as-cpi-hits-5-81-in-october"> Inflation Squeezes Indian Households as CPI Hits 5.81% in October</a>

India Exim Bank forecasts a 1.85% YoY rise in Q3 FY25 merchandise exports to $107.5 billion, driven by steady demand and potential global monetary easing amid economic uncertainty.

India’s Q3 Merchandise Exports Expected to Reach $107.5 Billion Amid Modest Recovery

<h2>Surge in Consumer Inflation Hits 14-Month High</h2>India’s consumer price inflation (CPI) rose to 5.81% in October, marking a 14-month high. The rise was mainly fueled by soaring prices of food items such as tomatoes and edible oils. This inflation spike is close to the Reserve Bank of India’s (RBI) 6% tolerance ceiling, placing additional pressure on already stretched household budgets.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;<h3>Rising Food Costs Drive Inflation Spike</h3>Food inflation, accounting for nearly half of the CPI, significantly impacted the overall inflation rate. Tomato prices surged due to erratic weather, while a 20% increase in import taxes on edible oils further strained households. These food-related pressures suggest that inflation may persist in the near term, with economists expecting more price volatility ahead.<h3>Rate Cut Unlikely as RBI Holds Off Easing</h3>Given inflation’s proximity to the upper limit of RBI’s target range, economists believe a rate cut is unlikely until early next year. Suvodeep Rakshit of Kotak Institutional Equities commented, “If you look at RBI's forecast of growth, there is very little reason why support to growth is needed,” emphasizing a conservative approach to monetary policy.Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Educatio</a><h3>Core Inflation Stays Elevated Amid Festive Demand</h3>Core inflation, excluding food and energy prices, was estimated at 3.60% in October. Festive demand and rising gold prices kept core inflation elevated, suggesting steady price pressures even beyond food. Economist Dipanwita Mazumdar noted, “Core would also be on the upside due to frontloading of festive demand.”<h3>Outlook: Inflationary Pressures to Persist</h3>Multiple factors, including climate risks affecting crops, rupee depreciation, and global uncertainties, could keep inflation elevated. With inflation above RBI’s 4% target until at least 2026, economic stability faces a growing challenge. Rate cuts may remain on hold as the RBI balances inflation control with sustaining growth.Conclusion: Households Brace for Higher CostsWith inflationary risks persisting, Indian households face a prolonged period of elevated prices, particularly for essentials. The rising cost of living highlights the need for caution in economic policy as inflation continues to pressure consumers and businesses alike.Also Read: <a href="https://www.sovrenn.com/knowledge/fed-cuts-rates-to-4-5-as-trump-secures-presidency">Fed Cuts Rates to 4.5% as Trump Secures Presidency</a>

India's consumer price inflation (CPI) reached 5.81% in October, a 14-month high, driven by rising food prices like tomatoes and edible oils. The inflation surge nears the RBI's 6% tolerance ceiling, adding strain to household budgets.

Inflation Squeezes Indian Households as CPI Hits 5.81% in October

The US Federal Reserve cut its benchmark rate by 0.25%, bringing it to a target range of 4.50%-4.75% following a two-day Federal pen Market Committee (FOMC) meeting. This decision, the seventh policy shift in 2024, reflects the Fed's commitment to supporting economic stability amid cooling inflation and robust growth.&nbsp;Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;<h3>1. Fed Lowers Rates Post-Election, Ignoring Political Pressures</h3>Despite potential concerns about the implications of Donald Trump’s presidential victory, the Fed moved forward with a quarter-point rate cut. Chair Jerome Powell confirmed that political changes wouldn’t impact monetary policy in the immediate term, stating, “We don’t guess, we don’t speculate, and we don’t assume.” This cut is expected to ease costs for consumer loans, like mortgages, while broader economic factors will shape the long-term impact.<h3>2. Powell Pledges Stability Amid Presidential Criticism</h3>Fed Chair Jerome Powell assured the public he would complete his term until 2026, even amid prior critiques from Trump’s campaign. Powell emphasized the Fed’s independence, noting that governors cannot be removed by the president without cause. This stance is critical in preserving the Fed’s credibility and autonomy, as Trump has expressed interest in influencing rate policies directly.Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Education</a><h3>3. Gradual Rate Cuts Expected as Fed Watches Economic Signals</h3>Powell indicated confidence in the economy but emphasized a cautious approach to further cuts. While the Fed’s baseline is to ease rates gradually toward a “neutral” level, future adjustments will depend on economic data. “We’re trying to find neutral carefully, patiently,” Powell stated, underscoring a balanced strategy to sustain growth without triggering inflation.<h3>4. Fed Moderates Balance-Sheet Runoff Pace</h3>The Fed plans to slow its balance-sheet reduction, decreasing monthly Treasury securities runoff to $25 billion from $60 billion starting June 2024. This adjustment is intended to maintain liquidity and support financial conditions, reflecting the Fed’s intention to stabilize markets without excessive intervention.<h3>5. Wall Street Rallies to New Highs Post-Fed Decision</h3>Wall Street responded strongly to the Fed’s rate cut, with the S&amp;P 500 and Nasdaq reaching record highs. Led by gains in tech stocks, the Nasdaq climbed 1.5% to 19,269.46, while the S&amp;P 500 rose 0.7% to 5,973.10.&nbsp;The Fed’s second consecutive rate cut illustrates a careful approach to maintaining economic momentum while addressing inflation, balancing market reactions with the need for policy stability amid a new political landscape.Also Read: <a href="https://www.sovrenn.com/knowledge/monsoon-rainfall-cools-diesel-demand-slowing-excise-collection-growth">Monsoon Rainfall Cools Diesel Demand, Slowing Excise Collection Growth</a>

The US Federal Reserve cuts its benchmark rate by 0.25%, lowering it to a range of 4.50%-4.75%. This seventh policy shift in 2024 aims to support economic stability amid cooling inflation and strong growth.

Fed Cuts Rates to 4.5% as Trump Secures Presidency

<h2>Diesel Demand and Excise Collections: Slower Than Expected Growth</h2>The Indian government’s excise duty collections grew moderately in the first half of this fiscal year, reaching ₹1.28 trillion from April to September. Although up 2.9% year-over-year, collections fell short of the targeted 5% annual growth, with diesel demand dampened by heavy monsoon rains. Data from the Controller General of Accounts (CGA) shows that while overall tax revenue rose 12%, excise on diesel underperformed due to reduced demand.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;<h3>How Diesel Excise Duty Works and Why Volume Matters</h3>Excise duties on fuels like diesel and petrol are levied per litre, not as a percentage of price. Therefore, the government’s revenue depends on the quantity consumed. Crude oil produced domestically is also subject to a specific rate excise duty, with certain older oil fields attracting an additional cess.<h3>Monsoon's Impact on Diesel Consumption</h3>This year’s heavy monsoon delayed construction projects, curbing the need for diesel-powered logistics and transport. According to D.K. Srivastava, Chief Policy Advisor at EY, “Monsoons delay building activity, dampening diesel demand.” The Ministry of Finance’s monthly report for September noted that monsoon rains slowed mining and construction but bolstered agricultural activity. However, this did not significantly lift diesel consumption, as the need for diesel-powered irrigation was lower.Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Education</a><h3>Windfall Tax Partially Offsets Diesel Revenue Decline</h3>Additional support for excise revenue came from the windfall tax on domestic crude production. This tax, levied as a special excise duty, remained higher than last year’s rate until mid-August, before slightly declining. While this revenue helped offset reduced diesel excise, it wasn’t enough to fully counterbalance weak diesel demand.<h3>Fiscal Position: Deficit Within Target</h3>Despite challenges with diesel excise growth, the Centre’s fiscal deficit remains manageable, aligned with the annual target of 4.9% of GDP, or ₹16.1 trillion. However, changing consumer habits and seasonal trends could continue to affect fuel tax collections, prompting a need for careful fiscal planning.ConclusionHeavy monsoons and a gradual shift in consumer preferences are slowing diesel demand and impacting the Centre’s excise revenue targets. As the government adapts to these changes, monitoring seasonal impacts and emerging vehicle trends will be critical for meeting revenue goals.Also Read: <a href="https://www.sovrenn.com/knowledge/india-s-service-sector-pmi-surges-in-october-a-strong-rebound-amid-cost-pressures">India’s Service Sector PMI Surges in October: A Strong Rebound Amid Cost Pressures&nbsp;</a>

The Indian government’s excise duty collections grew moderately in the first half of this fiscal year, reaching ₹1.28 trillion from April to September. Although up 2.9% year-over-year, collections fell short of the targeted 5% annual growth, with diesel demand dampened by heavy monsoon rains. Data from the Controller General of Accounts (CGA) shows that while overall tax revenue rose 12%, excise on diesel underperformed due to reduced demand.

Monsoon Rainfall Cools Diesel Demand, Slowing Excise Collection Growth

Manufacturing PMI Surges with October GainsIndia's manufacturing activity bounced back in October, with the HSBC India Manufacturing Purchasing Managers Index (PMI) rising to 57.5, up from September’s 56.5. This marks a positive shift following an eight-month low, with the PMI maintaining its position above the expansion threshold of 50 for almost three consecutive years.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;Strong Demand Spurs New Orders and Export GrowthDomestic and international demand drove new orders, helping to reverse September’s slowdown. Export orders, in particular, showed recovery, with increased demand from markets across Asia, Europe, Latin America, and the US. Pranjul Bhandari, Chief India Economist at HSBC, observed, "India’s manufacturing PMI picked up in October as rapidly expanding new orders reflect strong demand growth."Inflationary Pressures Continue to ClimbManufacturers faced rising costs in materials, labor, and logistics, leading to increased input and selling prices. Persistent inflation impacted business expenses, yet resilient demand allowed firms to balance higher costs with steady output growth.Positive Growth Forecasts Boost ConfidenceThe Reserve Bank of India (RBI) recently raised its FY25 GDP growth forecast from 7% to 7.2%, citing stronger rural and urban demand and favorable monsoon conditions. The festival season has also contributed to a surge in consumer confidence, further lifting sentiment across the manufacturing sector.Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Education</a>Manufacturing as a Path to a $10 Trillion EconomyIndia’s ambitious goal of transforming into a $10 trillion economy within the next decade is closely tied to manufacturing growth in sectors like semiconductors, electronics, electric vehicles, renewable energy, and defense. Increased government spending on infrastructure has bolstered this growth, with Indian suppliers improving their capacity to meet rising demand comfortably.The sustained expansion in manufacturing and supplier performance underscores India’s potential to meet its economic targets, driven by robust domestic demand and growing export competitiveness.Also Read: <a href="https://www.sovrenn.com/knowledge/china-s-countermeasures-in-place-as-trump-threatens-60-tariffs">China’s Countermeasures in Place as Trump Threatens 60% Tariffs&nbsp;</a>

India's manufacturing activity bounced back in October, with the HSBC India Manufacturing Purchasing Managers Index (PMI) rising to 57.5, up from September’s 56.5. This marks a positive shift following an eight-month low, with the PMI maintaining its position above the expansion threshold of 50 for almost three consecutive years.

India’s Manufacturing Rebounds in October Amid Rising Demand and New Orders

India’s services sector witnessed a notable rebound in October, driven by robust customer demand, as per the latest survey data. The Service PMI, a critical economic indicator, showed sustained expansion, marking 39 consecutive months above the 50-point mark, which signals growth. Let’s delve into what these findings reveal about the health and momentum of India’s economy.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;<h2>Strong Demand Fuels Service Sector Expansion</h2>The HSBC India Services Purchasing Managers’ Index (PMI), compiled by S&amp;P Global, rose to 58.5 in October, up from 57.7 in September. After a slight dip, the October surge reflects renewed demand across both domestic and international markets. Responses from over 400 service firms highlight a significant uptick in business activity, driven by customer interest and robust sales pipelines.<h3>Employment Boost: Fastest Hiring in Over Two Years</h3>The October PMI data also showcased the strongest job creation in 26 months as companies hired to keep up with surging demand. The hiring boost underscores the optimism within the service sector, where demand remains elevated despite economic uncertainties. “Strong expansions in output and consumer demand led to a substantial increase in employment within the services sector,” said Pranjul Bhandari, Chief India Economist at HSBC.Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Education</a><h3>Services Sector: The Cornerstone of India’s GDP Growth</h3>India’s services sector plays a pivotal role in the economy, contributing over 50% to the national GDP. The country’s economy recorded an 8.2% growth rate in the 2023-24 fiscal year, outpacing the Reserve Bank of India’s (RBI) 7% forecast. However, GDP growth moderated to 6.7% in the April-June quarter, reflecting global headwinds and domestic cost pressures. Despite this, the robust performance in October suggests the sector is regaining momentum and supporting broader economic stability.<h3>Resurgence in Manufacturing Activity</h3>India’s manufacturing sector also picked up speed in October. The HSBC India Manufacturing PMI increased to 57.5, up from September’s 56.5, highlighting strong new orders and export demand. This rise breaks from September’s eight-month low, signaling renewed vigor across the manufacturing landscape. Together, these trends reflect a broadly positive economic outlook as both service and manufacturing sectors post gains.Conclusion: Strong Foundation Amid Inflationary ChallengesIndia’s service sector has shown impressive resilience, reflecting the strength of domestic demand even as input costs rise. With high levels of consumer interest, expanding employment, and a positive outlook for both services and manufacturing, India’s economy appears well-positioned to weather the global headwinds. Businesses’ ability to navigate cost pressures and maintain growth suggests a stable trajectory in the months ahead, lending confidence to India’s economic forecast as the fiscal year progresses.&nbsp;Also Read: <a href="https://www.sovrenn.com/knowledge/india-s-fiscal-discipline-and-core-sector-resurgence-h1-fy-25-highlights">India’s Fiscal Discipline and Core Sector Resurgence: H1 FY25 Highlights</a>

India’s services sector rebounded in October with strong customer demand, as the Service PMI showed sustained growth for 39 consecutive months. Explore what this indicates about India's economic health and momentum.

India’s Service Sector PMI Surges in October: A Strong Rebound Amid Cost Pressures

IntroductionWhen Donald Trump began a trade war with China in 2018, Beijing faced a steep learning curve. Today, President Xi Jinping is prepared for a new confrontation as Trump threatens a 60% tariff on Chinese goods. Over recent years, China has built a toolkit to buffer its economy and counter external threats. Key strategies include export controls on essential materials, tariffs on U.S. agricultural products, and a robust “entity list” to target American companies.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;Strengthening Economic ResilienceIn response to past U.S. tariffs, China has fortified its economy, diversifying import sources and promoting domestic industries. For example, exporting electric vehicles and batteries has helped offset economic pressures, and lawmakers are now considering additional measures to stimulate growth if Trump’s threats materialize.&nbsp;Currency and Market PressuresChina’s financial markets are already reacting to the possibility of a new trade war. This week, the offshore yuan dropped 1.3% against the dollar, and Chinese stocks faced declines, signalling volatility. Economists like Alicia Garcia Herrero at Natixis believe China will deploy a “bigger stimulus” to protect its economy from market penalties if Trump imposes the tariffs.Retaliation Ready, But LimitedWhile China is poised to retaliate, options are limited. Past measures included targeting U.S. agricultural goods—such as corn and soybeans—but the U.S.’s share in these imports has fallen, with countries like Brazil taking up the slack. Nonetheless, experts assert that China is “prepared to fight fire with fire” if necessary.Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Education</a>Export Controls and U.S. DependenciesOne of China’s new tools is imposing export controls on critical raw materials, such as gallium and germanium, which are essential to chip manufacturing and defence industries. Beijing may consider further restrictions on materials like antimony, which is vital for American technologies.&nbsp;In sum, China’s strategy is clear: ready to retaliate, but cautiously optimistic about finding a path to mitigate economic damages. Yet, Beijing is bracing for the volatility ahead, underscoring its preparedness, but it recognizes that there is “no silver bullet” to avoid the potential fallout of Trump’s tariff threats.Also Read:<a href="https://www.sovrenn.com/knowledge/category/macro-economy">Swiss Companies Shift Focus from China to India</a>

When Donald Trump began a trade war with China in 2018, Beijing faced a steep learning curve. Today, President Xi Jinping is prepared for a new confrontation as Trump threatens a 60% tariff on Chinese goods. Over recent years, China has built a toolkit to buffer its economy and counter external threats. Key strategies include export controls on essential materials, tariffs on U.S. agricultural products, and a robust “entity list” to target American companies.

China’s Countermeasures in Place as Trump Threatens 60% Tariffs

Swiss giants such as&nbsp;ABB&nbsp;and&nbsp;Kuehne Nagel&nbsp;are ramping up investments in India as the two nations prepare to benefit from the&nbsp;$100 billion Trade and Economic Partnership Agreement (TEPA)&nbsp;with the&nbsp;European Free Trade Association (EFTA). The agreement, set to cut tariffs and create job opportunities, comes amid a strategic shift by businesses looking beyond China’s slowing economy and geopolitical risks.Finding multibagger stocks is important for building wealth. Discover potential multi-baggers at&nbsp;<a href="https://www.sovrenn.com/discovery/Large%20Order%20Receipts">Sovrenn Discovery.</a>&nbsp;<h2>TEPA: A Game-Changer for Swiss-Indian Trade</h2>TEPA, signed in&nbsp;March 2024, is expected to reduce&nbsp;tariffs on 94.7% of Swiss exports&nbsp;to India, from chocolates to industrial machinery. Though the agreement is&nbsp;pending parliamentary approval&nbsp;and will likely take effect by&nbsp;2026, businesses are already optimistic about easier market access and&nbsp;competitive advantages&nbsp;over companies in the&nbsp;EU and UK.<h2>Why Swiss Firms Are Doubling Down on India</h2>ABB, a leader in industrial automation, has&nbsp;expanded its workforce from 6,000 to 10,000&nbsp;since 2020, driven by a&nbsp;27% annual rise in orders&nbsp;from India. “We are building for India, in India,” said ABB CEO&nbsp;Morten Wierod, underscoring the company’s&nbsp;commitment to local production.Meanwhile, logistics giant&nbsp;Kuehne Nagel&nbsp;has more than&nbsp;doubled its workforce to 4,800&nbsp;and opened new hubs in&nbsp;Chennai, Gurugram, and Kolkata. Managing Director&nbsp;Anish Jha&nbsp;praised India’s&nbsp;National Logistics Plan&nbsp;for lowering transportation costs, boosting growth, and supporting&nbsp;logistics infrastructure.Investing has built huge wealth for several HNI investors. Learn investing FREE OF CHARGE at&nbsp;<a href="https://www.sovrenn.com/education">Sovrenn Education</a><h3>A New Investment Destination for Precision Engineering</h3>Even smaller companies are getting in on the action.&nbsp;Feintool, a precision components manufacturer, is building its&nbsp;first plant in Pune, which will employ 200 people and serve India’s growing automotive sector. In 2023, India accounted for&nbsp;1.5% of Swiss mechanical exports, but that share is rising—growing&nbsp;8% year-over-year. This trend reflects how companies are&nbsp;rebalancing their supply chains&nbsp;away from China, favoring India’s dynamic economy.Conclusion: India’s Red Carpet for Global InvestmentTEPA will provide Swiss companies with&nbsp;zero-tariff access&nbsp;and help generate&nbsp;1 million new jobs&nbsp;in India over the next&nbsp;15 years. As businesses shift operations from China, India is positioning itself as a&nbsp;global trade hub, offering&nbsp;local manufacturing incentives, infrastructure growth, and a booming market of&nbsp;1.4 billion consumers. The&nbsp;Swiss-India partnership&nbsp;signals a broader trend—one where India is quickly becoming a&nbsp;preferred destination&nbsp;for global firms eager to tap into new opportunities.&nbsp;Also Read<a href="https://www.sovrenn.com/knowledge/india-s-fiscal-discipline-and-core-sector-resurgence-h1-fy-25-highlights">: India’s Fiscal Discipline and Core Sector Resurgence: H1 FY25 Highlights</a>

Swiss giants ABB and Kuehne Nagel are increasing investments in India as part of the $100 billion Trade and Economic Partnership Agreement (TEPA) with the European Free Trade Association. This strategic move aims to cut tariffs, create job opportunities, and help businesses navigate the shifting economic landscape beyond China.

Date	Title
Dec 4th 24	India’s Services Sector: Growth Holds Firm Amid Cost Pressures
Dec 3rd 24	GST Hike on Tobacco, Aerated Beverages: New 35% Slab Proposed
Dec 3rd 24	India’s Manufacturing Growth Slows to 11-Month Low in November Amid Price Pressures
Dec 3rd 24	India’s Cooperative Sector to Generate Over 11 Crore Jobs by 2030
Dec 3rd 24	US Q3 GDP Growth: Resilience Amid Challenges
Dec 2nd 24	India’s Growth Outlook: Diverging Paths of S&P and FinMin
Dec 2nd 24	India’s Economic Outlook: A Cautious Optimism Amid Global Challenges
Dec 2nd 24	U.K. Economy Faces Surprise Contraction in September
Dec 2nd 24	Centre’s Capex Target: Building Momentum Amid Challenges
Dec 2nd 24	Raghuram Rajan Warns: US Public Debt a Growing Vulnerability
Nov 25th 24	UK and India to Revive FTA Talks: A New Era of Trade Cooperation
Nov 18th 24	Fed Chair Powell Stresses Caution on Rate Cuts Amid Economic Strength
Nov 12th 24	India’s Q3 Merchandise Exports Expected to Reach $107.5 Billion Amid Modest Recovery
Nov 11th 24	Inflation Squeezes Indian Households as CPI Hits 5.81% in October
Nov 8th 24	Fed Cuts Rates to 4.5% as Trump Secures Presidency
Nov 7th 24	Monsoon Rainfall Cools Diesel Demand, Slowing Excise Collection Growth
Nov 7th 24	India’s Manufacturing Rebounds in October Amid Rising Demand and New Orders
Nov 7th 24	India’s Service Sector PMI Surges in October: A Strong Rebound Amid Cost Pressures
Nov 7th 24	China’s Countermeasures in Place as Trump Threatens 60% Tariffs
Oct 31st 24	Swiss Companies Shift Focus from China to India

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