Top Business and Economic News: Key Highlights Shaping India's Growth

In the latest economic update, the Indian government’s direct tax collections have surged by 15.4%, hitting a record Rs 12.1 trillion as of mid-November, reflecting a strong performance in tax revenue generation. This comes at a time when the country is gearing up for a series of key policy decisions and reforms aimed at boosting infrastructure and business growth.

But this is just the tip of the iceberg. There's much more happening across the business and economic landscape, from significant policy developments in finance and industry to the emergence of new opportunities in sectors like agriculture, textiles, and technology. Let’s take a deeper dive into the most important stories shaping India’s economy and business world this week.

As part of TICE’s daily news round-up, we bring you the top highlights making waves in India’s business ecosystem today. Here are the stories that matter:

Top Business & Economy News of The Day

• Net direct tax collection rises 15.4% to Rs 12.1 trillion in April-Nov

The Indian government's net direct tax collection has increased by 15.4% year-on-year, reaching Rs 12.1 trillion ($143 billion) during the period from April 1 to November 10. This growth indicates a robust economic performance in terms of tax revenue. On a gross basis, direct taxes, including both corporate and personal taxes, grew over 21%, amounting to Rs 15 trillion. The government also issued tax refunds totaling Rs 2.9 trillion, signaling a continued focus on tax compliance and facilitating business growth.

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• FM seeks AIIB help for next-gen reforms

Finance Minister Nirmala Sitharaman has sought assistance from the Asian Infrastructure Investment Bank (AIIB) to enhance India's infrastructure and support the country's next-generation reforms. Speaking to a high-level delegation from AIIB, Sitharaman emphasized the importance of AIIB’s investment in areas like climate adaptation, energy security, urban development, and infrastructure. The move comes as India works towards further boosting its developmental agenda and sustainability goals.

• Union Cabinet likely to approve ELI schemes after Jharkhand and Maharashtra elections

The Union Cabinet is expected to approve the employment-linked incentive (ELI) schemes after the completion of elections in Jharkhand and Maharashtra, which are scheduled to end on November 20. These schemes, which are likely to be implemented before the end of 2024, aim to boost employment and economic growth in key sectors. The approval has been delayed until after the state elections, ensuring political neutrality during the process.

• RBI issues operational framework for reclassification of FPI to FDI

The Reserve Bank of India (RBI) has issued a new operational framework that allows foreign portfolio investors (FPIs) to reclassify their investments as foreign direct investments (FDI) if their holdings exceed the prescribed limit. Currently, FPIs are allowed to hold less than 10% of a company’s total paid-up equity capital. The new framework offers a grace period of five trading days to divest or reclassify any investments that breach this limit, providing greater flexibility and clarity for foreign investors.

• Plans afoot to put LLPs and companies on par in accounting

The Indian government is planning to introduce new accounting standards for large limited liability partnerships (LLPs), particularly those with an annual turnover exceeding Rs 250 crore, to align their accounting practices with those followed by companies. This move is intended to enhance transparency, accountability, and corporate governance within the LLP sector. The shift is expected to foster greater investor confidence and streamline business operations in these entities.

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• Defaults coming back to bite, banks rein in growth of unsecured credit

Banks in India are tightening their lending policies as defaults in personal loans, credit cards, and microfinance portfolios have been rising. In response, they are cutting down credit card limits, reducing pre-approved personal loans, and lowering loan-to-value (LTV) ratios on mortgages. These measures are aimed at managing risk in high-stress segments of the unsecured credit market, with banks focusing on customer profiles, credit scores, and geographical areas showing higher risk.

• Do fresh KYC of PM Jan Dhan accounts due for updation: DFS secretary to banks

The Financial Services Secretary, M Nagaraju, has instructed banks to conduct fresh KYC (Know Your Customer) processes for Pradhan Mantri Jan Dhan Yojana (PMJDY) accounts, which are now due for periodic updates after a decade of operations. These accounts, which were opened in mission mode during the initial phase of PMJDY, are now required to undergo re-KYC to comply with regulatory standards. This step will ensure the continued security and proper management of these accounts.

• Simplify T&Cs in insurance policies to cut complaints: IRDAI panel member

A member of the Insurance Regulatory and Development Authority of India (IRDAI) advisory committee has recommended that insurance companies simplify the terms and conditions of their policies to reduce customer complaints. The suggestion aims to make policy documents easier to understand, ultimately improving customer satisfaction and reducing the volume of grievances. This recommendation comes as part of IRDAI's efforts to ensure better consumer protection and clarity in the insurance sector.

• 'Govt FY25 spends to be in sync with Budget estimates of ₹48.2 lakh crore'

Despite the expected supplementary demands for grants, the Indian government is committed to keeping its total expenditure for the fiscal year 2024-25 in line with the budgeted estimate of Rs 48.2 lakh crore. This will help the government achieve its fiscal deficit target of 4.9% of GDP. The additional expenditure may be managed through savings or increased receipts from various ministries without inflating the overall spending.

• Textile hub Tiruppur weaves a comeback as exports spring back to life

After a tough year in 2023-24, where exports saw an 11% contraction, the Tiruppur textile industry has rebounded strongly in 2024-25, posting a 13% increase in exports during the first five months of the fiscal year. The cluster, responsible for over half of India’s knitwear exports, saw a 22% rise in exports in August 2024, marking the highest growth in two years. The resurgence is attributed to the Green Tiruppur sustainability strategy, which has attracted major global brands like Primark and Tommy Hilfiger to place fresh orders with the city's manufacturers.

• Rural FMCG basket expands on hybrid media usage, rising digital engagement

The rural FMCG sector has witnessed a significant 60% increase in the average basket size from 2022 to 2024, primarily driven by a rise in digital engagement and the consumption of convenience products like ready-to-eat meals and beverages. This shift reflects changing consumer behavior in rural areas, where hybrid media consumption and the rising popularity of online shopping have led to greater demand for FMCG goods. This trend was highlighted in the Rural Barometer Report, which surveyed thousands of rural consumers across India.

• Semiconductor sector to create 1 million jobs in India by 2026: Report

India’s semiconductor industry is expected to generate one million jobs by 2026 as the country aims to become a global hub for semiconductor manufacturing. The demand for skilled labor will span several categories, including chip fabrication, assembly, testing, packaging, chip design, and software development. This surge in job creation is a reflection of India’s growing commitment to the semiconductor sector, which is vital for both technological advancement and economic growth.

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• FSSAI looking to develop SOP for online food deliveries for quick commerce, e-commerce platforms

The Food Safety and Standards Authority of India (FSSAI) is in the process of creating a Standard Operating Procedure (SOP) for online food deliveries, focusing on ensuring compliance with food safety standards across the entire supply chain. The SOP will cover packaging, storage, logistics, transportation, and hygiene practices for delivery personnel involved in quick commerce and e-commerce platforms. This initiative aims to strengthen food safety regulations in the rapidly growing online food delivery market.

• Rabi sowing gains pace but southern states lag

Rabi sowing has gained momentum in many parts of India, with farmers opting for crops like wheat, chana, and mustard due to stable prices in recent months. However, southern states, particularly Andhra Pradesh, Kerala, and Tamil Nadu, have experienced delays in sowing due to prolonged rainfall, which has disrupted agricultural activities in these regions. Despite this, the overall progress of rabi sowing across the country is expected to meet targets for the current season.

• Rising costs & harsh weather put tea industry’s future at risk, warns Indian Tea Association

The Indian Tea Association has raised concerns over the financial sustainability of the tea industry, which is facing severe challenges due to rising operational costs and unremunerative prices. Adverse weather conditions in Assam and West Bengal have further exacerbated the situation, resulting in a significant decline in tea production in 2024. The industry has called for urgent measures to address these challenges and ensure the future viability of tea cultivation in the country.

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