Economy

The Indian stock market extended its upward momentum for a fourth consecutive session, with the BSE Sensex rising 411 points to close at 68,230, led by gains in financial, IT, and energy stocks. Investor optimism was fueled by robust domestic economic indicators, positive corporate earnings, and steady foreign fund inflows. Market breadth remained strong, with over 70% of stocks advancing, while the Nifty 50 index surged 120 points to 20,450.

India and the United States have intensified trade negotiations aimed at strengthening bilateral economic cooperation while ensuring that domestic priorities — particularly the protection of farmers and micro, small, and medium enterprises (MSMEs) — remain central to the discussion. The talks, held under the framework of the India-U.S. Trade Policy Forum (TPF), seek to resolve long-standing issues related to market access, agricultural tariffs, digital trade, and intellectual property.

The government’s decision to reduce Goods and Services Tax (GST) rates on select goods and services is poised to provide direct relief to consumers while stimulating demand across key sectors. As part of a broader effort to balance inflation management with growth momentum, the rate cuts are expected to lower retail prices, enhance purchasing power, and support small businesses. However, the Finance Ministry has emphasized that strict price monitoring will accompany these reductions to ensure the benefits reach end consumers.

India’s electronics consumption is projected to surge past Rs. 20 lakh crore by 2030, propelled by comprehensive Goods and Services Tax (GST) reforms, rising digital adoption, and a thriving manufacturing ecosystem. The sector — a cornerstone of the country’s technology-driven growth — is witnessing robust demand across smartphones, wearables, appliances, and electronic components. Policy measures under the GST regime have streamlined taxation, improved supply chains, and enhanced domestic value addition.

India and Brazil are set to enhance their economic partnership by expanding the existing Preferential Trade Agreement (PTA) under the Mercosur framework. This initiative aims to increase bilateral trade from $12 billion in 2024 to $20 billion by 2030. The expansion will cover additional tariff lines and address both tariff and non-tariff barriers, with a focus on sectors such as pharmaceuticals, textiles, and banking.

India's unemployment rate for individuals aged 15 and above increased marginally to 5.2% in September 2025, up from 5.1% in August, as per the latest data from the Ministry of Statistics and Programme Implementation. This uptick follows two consecutive months of decline and reflects a complex interplay of factors influencing the labor market. Notably, the rise in unemployment is attributed to higher joblessness in both rural and urban areas, with women experiencing a disproportionate impact.

Reserve Bank of India (RBI) Governor Sanjay Malhotra has indicated that there is policy space for potential interest rate reductions, contingent on economic conditions. While the repo rate remains steady at 5.50%, falling retail inflation—recording 1.54% in September 2025—and a downward revision of the FY26 inflation forecast to 2.6% provide scope for future easing. Governor Malhotra emphasized a cautious, data-driven approach, noting that while conditions are favorable, immediate rate cuts are not yet warranted.

In a pre-Diwali gesture aimed at alleviating the financial strain on government employees and pensioners, the Himachal Pradesh government has announced a 3% increase in Dearness Allowance (DA). This adjustment, effective from July 1, 2025, will benefit approximately 2.15 lakh employees and 1.90 lakh pensioners. The revised DA will be reflected in the October 2025 salaries and pensions, with arrears from July 2025 to September 2025 to be disbursed subsequently.

India and the United States are stepping up efforts to expand their energy trade partnership, underscoring a shared interest in energy diversification, trade balance, and geopolitical alignment. India aims to increase imports of U.S. crude oil, liquefied natural gas (LNG), and other energy products to enhance energy security and reduce dependence on traditional suppliers. The move also seeks to address U.S. concerns over India’s continued purchases of Russian oil.

India's Pradhan Mantri Surya Ghar Yojana (PMSGY) has achieved a significant milestone by installing 4.9 gigawatts (GW) of residential rooftop solar capacity as of July 2025. Despite this progress, the scheme has met only 13% of its ambitious target of 10 million installations, raising concerns about the pace of adoption and the efficient utilization of allocated subsidies. The government aims to provide free electricity to 10 million households by FY2027, but challenges such as financing gaps, technical issues, and weak awareness persist.