Business
Will ensure adequate liquidity to support economic recovery: RBI Governor

RBI Governor Shaktikanta Das on Friday said that adequate liquidity will be ensured to support the process of economic recovery.
In a virtual address post the monetary policy meet, he said that the RBI will continue to support the market in ensuring an orderly completion of the borrowing programme of the government.
“Our focus on orderly evolution of the yield curve as a public good also continues.”
The statement assumes significance as Das said that RBI may consider complementing the 14-day VRRR (variable rate reverse repo) auctions with 28-day VRRR auctions in a similar calibrated fashion.
Besides, he said that RBI retains the flexibility to conduct fine-tuning operations of varying amounts as and when required.
“Even with all these operations, the liquidity absorbed under the fixed rate reverse repo would still be around Rs 2 to 3 lakh crore in the first week of December 2021.”
Furthermore, he said with the resumption of normal liquidity operations since mid-January 2021, 14-day VRRR auctions have been deployed as the main instrument under the liquidity management framework.
“Market appetite for VRRRs has been enthusiastic. Moreover, the higher remuneration which VRRR offers vis-a-vis the fixed rate reverse repo is also rendering the former relatively attractive.”
Additionally, he reiterated that VRRR auctions are primarily a tool for rebalancing liquidity as part of liquidity management operations and “should not be interpreted as a reversal of the accommodative policy stance”.
Since the onset of the pandemic, the Reserve Bank has maintained ample surplus liquidity to support a speedy and durable economic recovery. The level of surplus liquidity in the banking system has increased further during September 2021.
Even with absorption under fixed rate reverse repo, VRRRs and fine-tuning operations under the liquidity adjustment facility (LAF), it has averaged about Rs 9 lakh crore per day as against Rs 7 lakh crore during June to August 2021.
The surplus liquidity rose even further to a daily average of Rs 9.5 lakh crore up to October 6.
In addition, Das said the potential liquidity overhang amounts to more than Rs 13 lakh crore.
Business
India, Africa must double bilateral trade by 2030: Piyush Goyal

New Delhi, Aug 29: India and Africa must work to double bilateral trade by 2030, focusing on value addition, technology-driven agriculture, renewable energy, and healthcare, Minister of Commerce and Industry Piyush Goyal said on Friday.
Delivering the keynote address at the valedictory session of the CII India Africa Business Conclave here, the minister pointed out that bilateral trade between India and Africa is already fairly balanced — with India’s exports at $42.7 billion and imports at $40 billion.
However, he underlined the untapped potential across regions: “This demonstrates the opportunity we have missed out on over the years, and the scope for expansion today.”
The Minister stressed that India and Africa need not compete in every sector, but rather explore complementarities.
He highlighted areas such as agriculture, food security, cooperative and self-help group movements, education, skill development, capacity building, research and development, innovation, start-ups, healthcare, pharmaceuticals, and renewable energy, which provide vast opportunities for mutual benefit.
Goyal highlighted the immense potential for collaboration in the automobile sector. He noted that while Africa imports nearly $20 billion worth of motor vehicles annually, India currently supplies only about $2 billion of this demand.
He underlined that Indian automobiles are globally competitive, both in terms of cost and quality, with manufacturing standards on par with the best in the world.
He said that Indian manufacturers can play a vital role in meeting Africa’s growing demand for passenger vehicles, commercial vehicles, two and three-wheelers, and affordable electric mobility solutions.
This opens up a wide delta of opportunity for African nations to access reliable, fuel-efficient, and environmentally sustainable vehicles at competitive prices, while India can, in return, benefit from greater imports of African resources such as critical minerals, petroleum products, and agricultural commodities.
This balanced exchange would help both regions expand trade, generate employment, and build long-term industrial partnerships, he added.
Highlighting complementarities, the Minister observed that Africa could support India in areas such as critical minerals and petroleum products, while India could support Africa in food security, technological upgradation, manufacturing, and services.
He mentioned that India is cost-competitive in services like architecture, engineering, IT, AI and telecom, while also offering potential in medical tourism.
Referring to India’s close bond with Mauritius, Goyal assured the Indian Ocean island nation continued support in addressing inflationary pressures in essentials such as milk products, edible oils, and rice.
“It is this spirit of friendship and cooperation that defines India’s engagement with Africa,” he said.
Goyal also recalled India’s support to Africa during the Covid-19 pandemic, when medicines, vaccines and pharmaceutical products were provided at affordable costs, unlike the highly-priced alternatives from developed nations.
He further said that India’s Unified Payments Interface (UPI) could help bring down transaction costs and strengthen Africa’s financial systems.
Calling the Global South the true voice of the developing world, Goyal urged African nations to work with India at multilateral platforms like the WTO to create common objectives and influence global decision-making.
He emphasised collaboration in agriculture technologies, renewable energy, generic medicines, critical minerals, and youth partnerships, noting that the young populations of India and Africa will define the future.
Business
India, Japan can diversify trade basket, open new frontiers with renewed efforts: PM Modi

Tokyo, Aug 29: Hailing the robust India-Japan economic and trade partnership, Prime Minister Narendra Modi on Friday said with renewed efforts, both nations can diversify their trade basket, make it more balanced, and open up new frontiers as well.
In an interview with Japanese newspaper The Yomiuri Shimbun, the Prime Minister said we must aim bigger and remain ambitious.
“The synergies across governments, businesses and people can create scale and speed in our economic partnership. As the world’s leading economies, we have been contributing to each other’s growth, competitiveness and dynamism,” PM Modi told the publication.
Japan has been a trusted partner in India’s infrastructure development across generations. The country has also been a leading source of foreign direct investment (FDI) for India in key sectors, including automobiles, electronics, telecom, chemicals, finance, and pharmaceuticals.
According to PM Modi, the number of Japanese firms in India has grown steadily to around 1,500, while more than 400 Indian companies operate in Japan.
“Clearly, this is only the beginning — the real potential is much higher,” he noted.
“We maintain important trade relations, but it has not yet reached the levels envisaged under our CEPA (Comprehensive Economic Partnership Agreement)… The 20th century saw Japan emerge as a major partner in India’s infrastructure development. I am confident that the 21st century will see Japan as a major partner in India’s innovation, manufacturing, and global value chains,” the Prime Minister emphasised.
On semiconductors, PM Modi told the publication that India’s semiconductor sector is on the cusp of transformation.
“We have put in place a comprehensive regulatory and policy framework, backed by incentives, to build a strong semiconductor and display ecosystem. Already, six semiconductor units are taking root in India, with four more on the way. By the end of this very year, ‘Made in India’ chips will be in the market, a clear demonstration of India’s design and manufacturing capabilities,” the Prime Minister said.
Japanese companies, with their technological strengths and global leadership, can play a pivotal role in this journey, he said, adding that a strong beginning has already been made.
“By combining India’s scale and capabilities with Japan’s advanced technologies, we can build a resilient and trusted semiconductor value chain,” PM Modi stressed, adding that this collaboration will support the technological ambitions of both our countries and enhance global supply chain security.
“I see semiconductor cooperation emerging as a major pillar of the India–Japan partnership. After all, in this digital century, chips are not just about computers, they are about competitiveness, credibility and confidence in the future,” he mentioned.
Some Japanese companies are positioning their production bases in India as hubs for third-country markets such as Africa.
According to PM Modi, India has seen multi-faceted reforms which make manufacturing in India easier than ever before.
“We have removed compliance burdens, rolled out incentives and ensured a large skilled workforce for companies to set base in India. Many global companies, including those from Japan, are setting up their production in India not only to cater to our domestic market, but also for the world,” he highlighted in his response.
Japanese automaker Suzuki Motor Corporation this week announced it will invest Rs 70,000 crore in India over the next five to six years. The investment will be used to increase production, introduce new car models, and protect its leadership position in the world’s third-largest automobile market.
“Just a couple of days back, I was at the Suzuki plant in India where we flagged off electric vehicles to be exported to a hundred countries, including Japan,” said PM Modi.
Business
Indian equity indices decline sharply over US tariff concerns

Mumbai, Aug 28 : The Indian equity indices fell sharply to end the session nearly one per cent lower on Thursday — a day after the 50 per cent US tariffs on Indian goods came into effect.
Sensex ended the session at 80,080.57, down 705 points or 0.87 per cent. The 30-share index started the session in negative territory at 80,754 against last session’s closing of 80,786.54 amid selling across the sectors. The Index further extended the losing momentum to hit an intra-day low at 80,013.02 following the implementation of US tariffs on Indian goods.
Nifty settled at 24,500.90, down 211.15 points or 0.85 per cent.
“Domestic equities ended lower as pessimism took hold following the implementation of tariffs on Indian goods, dampening investor sentiments. While the cotton import duty exemption briefly lifted hopes of policy support to counter tariff impacts, triggering a short-lived intraday recovery, investor mood remained fragile, with large caps declining and mid and small caps underperforming amid risk-off sentiment,” said Vinod Nair, Head of Research, Geojit Investments Limited.
Most sectors, including Auto, IT, FMCG, and Metals, traded in the red as investors turned to profit-booking from recent gains, while consumer durables outperformed, likely supported by GST rationalisation and expectations of festive demand, Nair added.
HCL Tech, TCS, Power Grid, Infosys, Hindustan Unilever, HDFC Bank, ICICI Bank, Bharati Airtel, Mahindra and Mahindra, Trent, Tata Motors, Sun Pharma, NTPC, BEL, Eternal and SBI were the top losers from the Sensex pack. While Titan, L&T, Maruti Suzuki, and Axis Bank were top gainers.
The majority of sectoral indices settled in negative territory amid selling pressure. Nifty Fin Services dropped 312.30 points or 1.20 per cent, Nifty Bank fell 630.10 points or 1.16 per cent, Nifty Auto declined 136.80 points or 0.54 per cent, Nifty FMCG closed 574.05 points or 1.02 per cent, and Nifty IT slipped 574.45 points or 1.59 per cent.
Broader indices followed suit as well. Nifty Small Cap 100 dipped 254.25 points or 1.45 per cent, Nifty Midcap 100 fell 718.70 per cent or 1.45 per cent, and Nifty 100 closed 235 points or 0.93 per cent lower.
Rupee traded weakly as selling pressure in capital markets deepened, with FII flows continuing to remain negative amid persistent concerns on India’s growth outlook and fiscal deficit.
“The imposition of a 50 per cent US tariff has raised uncertainty over exports, weighing on overall sentiment, until there is clarity on alternatives either through negotiations with the US or by striking trade agreements with other nations — investors are likely to stay cautious,” said Jateen Trivedi of LKP Securities.
The rupee is expected to remain under pressure with a near-term range of 87.25–88.25, he added.
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