Newspaper Summary 220126

 Rules-based world order has ended: Canadian PM.

In a major address at the World Economic Forum in Davos, Canadian Prime Minister Mark Carney argued that the world’s middle powers must band together to resist coercion from aggressive superpowers. Carney stated that recent events have shown the “rules-based international order” is effectively dead, meaning Canada and other nations must create new alliances to oppose the pressure tactics and intimidation of great powers. He urged world leaders to "stop invoking the ‘rules-based international order’ as though it still functions as advertised," labeling the current system as a period where the most powerful pursue interests by using economic integration as a weapon of coercion.

Carney highlighted several key points regarding this new geopolitical landscape:

• Arctic Tensions: Canada stands firmly behind Greenland and Denmark, asserting they have a “unique right to determine Greenland’s future” despite U.S. claims that it must own the territory for security reasons.
• NATO Commitment: Despite the widening trans-Atlantic rift, Carney emphasized that Canada's commitment to NATO’s Article 5 remains “unwavering” as it works to secure the alliance’s northern and western flanks.
• Naming Reality: Citing Czech dissident Václav Havel, Carney called on leaders and companies to start "naming reality" rather than sustaining a system built on mutual lies.
• Strategic Advantages: He pointed to Canada’s move to dramatically hike defence spending and develop new trade infrastructure, leveraging its large reserves of conventional energy and critical minerals.

The Prime Minister concluded that such alliances among mid-sized countries are the last line of defence in an era where dominant states use economic and military might to impose their will. He asserted that Canada possesses the capital, talent, and fiscal capacity to act decisively in this new order.

Wall Street lenders push back on Trump’s cost-of-living proposals

Major Wall Street banks are pushing back on President Donald Trump’s proposals to lower the U.S. cost of living ahead of the upcoming mid-term elections. While the banking industry is attempting to help shape these policies through dialogue with administration officials, they have voiced significant doubts about the effectiveness of measures such as capping credit card interest rates, a proposal that has already negatively impacted major bank shares.

Key details regarding the standoff between Wall Street and the White House include:

• Proposed Alternatives: Rather than interest rate caps, banks are suggesting alternatives such as encouraging more retirement savings and facilitating the earlier transfer of wealth from parents to children. However, sources indicate that none of these ideas are likely to have a substantial impact on affordability, which has become a "hot-button issue" for voters.
• Housing and Retirement Funds: Trump has proposed allowing investors to use a portion of their retirement funds to make down payments on houses. Investors have questioned this approach, suggesting that the primary driver of high costs is the supply of houses rather than a lack of access to down payment capital.
• CEO Reactions: Citigroup CEO Jane Fraser publicly stated that she does not expect Congress to approve caps on credit card interest rates. While acknowledging that the President is right to focus on affordability, she warned that capping rates would not be good for the U.S. economy.
• Economic Pressures: Although inflation has decreased from its post-pandemic peak, the costs of housing and groceries remain high, threatening Republican prospects in the mid-terms. Trump is seeking dramatic reductions in borrowing costs so Americans can more easily afford homes, cars, and other large purchases.

On the sidelines of the World Economic Forum in Davos, banking executives have expressed a desire to find common ground, with one top executive noting, "We’re saying, ‘what are you trying to achieve? Let’s figure out ways to help you’". Despite this, lenders are waiting for further policy clarity before taking any definitive actions.

Trump says ready to pick the next Federal Reserve chair.

Speaking at the World Economic Forum in Davos, Switzerland, US President Donald Trump stated that he has interviewed several strong candidates to succeed current Fed Chair Jerome Powell. Trump noted that an announcement regarding the new chairman will be coming in the "not too distant future". While he praised the interviewees as "great" individuals who could do a "fantastic job," he expressed frustration that nominees often "change once they take office".

Key details regarding the selection process and the candidates include:

• The Final Four: Treasury Secretary Scott Bessent confirmed that the President has whittled the field down to four leading candidates: Trump Economic Advisor Kevin Hassett, Fed Governor Christopher Waller, former Fed Governor Kevin Warsh, and BlackRock’s chief bond investment manager Rick Rieder.
• Criticism of Jerome Powell: Trump used the platform to renew his criticism of Powell, accusing him of not lowering interest rates fast enough. Both Trump and Bessent have repeatedly taken aim at Powell’s handling of monetary policy.
• Legal Pressures: The selection comes at a time of high tension between the administration and the central bank; the Justice Department recently issued a subpoena to Powell tied to the renovation of the Fed’s headquarters.
• Wider Fed Conflict: While Trump looks to name a new chair, the U.S. Supreme Court recently expressed skepticism regarding his bid to fire Fed governor Lisa Cook. The justices seemed inclined to keep Cook in her job, which would potentially hinder Trump’s attempts to wrest total control over the nation's central bank.

Trump’s primary economic objective is to secure dramatic reductions in borrowing costs. He wants the government to borrow more cheaply and seeks lower costs for Americans purchasing new homes and cars, as high costs have negatively impacted voter sentiment regarding his economic management. Trump has remained dismissive of concerns that cutting rates too quickly could trigger higher inflation.

Rapido’s revenue crosses ₹1,000 crore in FY25.

The Bengaluru-based ride-hailing platform reported strong topline growth in FY25, with revenue reaching ₹1,002.87 crore. This represents a 44.2% jump from the ₹695.26 crore recorded in the previous year. Alongside this revenue surge, the company successfully narrowed its net loss by 30.3%, bringing it down to ₹258.44 crore from ₹370.72 crore in FY24. Its EBITDA loss also improved significantly by 30.6% to ₹252.83 crore, reflecting tighter cost controls and improved unit economics.

Key details regarding Rapido’s financial performance and operations include:

• Revenue Shifts: Revenue from subscription services surged to ₹275 crore last fiscal, up from just ₹19 crore in FY24, driven by the expansion of three- and four-wheeler services. However, revenue from platform services, primarily commissions from bike taxis, fell to ₹347 crore from ₹505 crore.
• Operational Expenses: Employee expenses increased by 20% to ₹207.01 crore as the firm continued to invest in talent and product development to support new business lines.
• Swiggy Exit: In September 2025, Swiggy exited its 12% stake in Rapido, selling it to existing investors Prosus and WestBridge Capital for a total consideration of ₹2,399 crore.
• Expansion into Food Delivery: Rapido has moved into the food delivery segment with its own app, Ownly. This service aims to differentiate itself from competitors like Zomato and Swiggy by pricing meals at offline-equivalent rates, allowing restaurants to avoid high platform commissions.

The company's performance indicates an improving operating leverage as it scales its multi-modal transport and delivery offerings. While some sources noted a revenue figure of ₹934 crore in filings, the data from market intelligence platforms confirmed the milestone of crossing the ₹1,000 crore mark.

Adani Group outlines $66 billion investment blueprint for Maharashtra

At the 56th World Economic Forum Annual Meeting in Davos, the Adani Group unveiled a massive $66 billion long-term investment roadmap for the state of Maharashtra. This proposal signals a decisive phase in the state’s infrastructure-led growth, shifting the conglomerate’s focus from mere asset creation to building integrated, future-ready ecosystems.

Key details of the investment blueprint include:

• Strategic Sectors: The portfolio spans aviation, clean energy, urban redevelopment, digital infrastructure, and advanced manufacturing.
• Dharavi Redevelopment: A cornerstone project involves transforming Dharavi, Asia’s largest informal settlement, into a planned, inclusive, and economically vibrant district.
• Digital Infrastructure: The group plans to develop green integrated data centre parks with a combined capacity of 3,000 MW.
• Advanced Manufacturing and Energy: The roadmap includes semiconductor and display fabrication facilities, as well as coal gasification projects aligned with state frameworks for private participation.
• Infrastructure Boost: Other projects include an integrated arena district situated near the airport.

Pranav Adani, Director of Adani Enterprises, noted that these plans are designed to span a 7–10 year horizon. The investments emphasize scale, sustainability, and technology-led inclusion, aligning private capital with India’s broader global economic ambitions.

Maharashtra Chief Minister Devendra Fadnavis welcomed the proposal, stating that the state would support any investor bringing such significant capital because "without investment, jobs will not be created for our youth".

Merits of user tax on infra services By Madan Sabnavis, Chief Economist, Bank of Baroda

Raising revenue has consistently been a challenge for the government, as high direct tax rates can impede consumer spending power and corporate tax rates have been trending downward for over a decade. Furthermore, indirect taxes like the Goods and Services Tax (GST) are outside the immediate ambit of the Budget, and the GST Council recently lowered various rates in September. To address the growing demand from industry and economists for increased infrastructure spending, a new system of taxation based on the "multiple of 10" principle could be introduced as a special charge on infrastructure-related goods and services.

Key arguments for this user-based tax include:

• Price Inelasticity of Demand: Historical trends show that cost increases seldom limit the use of services such as telecom, travel, or the purchase of vehicles. Because the contemplated tax increases are nominal, the demand for these services is expected to remain unaffected.
• Low Consumer Burden:
  • Vehicles: An average ₹1,000 tax on a two-wheeler costing ₹75,000 represents just 1.3% of the price. Since vehicles are typically purchased once every 4–5 years, such a charge is not considered onerous.
  • Telecom: With an average annual revenue per user (ARPU) of ₹2,100, a ₹10 annual tax would be an increase of less than 0.5% and would largely go unnoticed by consumers.
  • Travel: For railways, a ₹10 per ticket charge (which could be graded from ₹1 to ₹100 based on travel class) would average a 3.8% increase. For airlines, a ₹100 tax on an average ticket price of ₹7,500 would result in a mere 1.3% increase.
• Minimal Inflationary Impact: The components targeted for this tax have relatively low weights in the Consumer Price Index (CPI). Mobile bills carry the highest weight at 1.86%, while others, such as two-wheelers (0.79%), cars (0.48%), and rail fares (0.18%), are significantly lower.
• Significant Revenue Generation: It is estimated that these nominal charges could generate approximately ₹20,000 crore for the government.

This approach is particularly relevant in FY26, a year characterized by unusually low inflation that has resulted in lower-than-expected nominal GDP. In such a business cycle, the government needs to explore alternative revenue-raising options that do not significantly affect the consumption of goods or services. These charges could be periodically revised to ensure stable and sustainable revenue flows for infrastructure development.

An ASEAN answer for India’s data centre push By Anuj Gupta and Karishma Maniar Shah

While India possesses strong fundamentals for the data centre industry—including a billion internet users, a deep IT talent pool, and a rapidly digitising economy—it is currently being outpaced by Malaysia, which is expected to surpass India in data centre capacity by 2029. Between 2021 and 2024, Malaysia attracted an estimated $43 billion in data centre investments, with Johor emerging as a global AI-infrastructure hotspot by absorbing spillover demand from Singapore.

The Malaysian Model of Success Malaysia’s rise is attributed to a relentless focus on overcoming constraints that often derail such investments: certainty, regulatory clarity, and speed. Key factors include:

• Speed-to-Market: Power approvals, which previously took 3–4 years, have been reduced to approximately 12 months under Tenaga Nasional Berhad.
• Policy Coordination: In 2025, Malaysia formalised a multi-agency Data Centre Task Force to harmonise approvals and plan infrastructure through a single interface for investors.
• Operational Sustainability: The National Energy Transition Roadmap targets 31% renewable energy by 2025 and 70% by 2050, moving sustainability from voluntary pledges to enforceable requirements.
• Data Governance: 2024 amendments to Malaysia's Personal Data Protection Act aligned the nation with global norms on cross-border data flows, reinforcing investor confidence.

India’s Paradox: Intent vs. Execution India’s position is described as paradoxical; while it hosts Asia’s second-largest capacity (projected to reach 4,500 MW by 2030), execution remains a major constraint.

• The Power Bottleneck: Data centres are projected to consume 3% of India's power by 2030. Developers face significant hurdles in securing long-term green power with stable pricing due to grid congestion and stressed state utilities.
• Regulatory Delays: Land and environmental clearances in India routinely take 18–36 months due to overlapping processes and a lack of enforceable timelines.
• Competitive Federalism: Unlike Malaysia’s coordinated national strategy, India’s growth is fragmented by state-level competition. While leaders like Maharashtra and Tamil Nadu face saturation, states like Telangana and Andhra Pradesh are now appealing to hyperscalers with cheaper land and streamlined processes.

Lessons for India The Malaysian experience offers a blunt lesson: success requires more than market size or subsidies; it demands prioritisation, sequencing, and stability. To lead the data centre boom, India must:

1. Ensure power certainty through early-stage grid access and firm renewable energy commitments.
2. Adopt tiered sustainability standards, including measurable Power and Water Usage Effectiveness metrics.
3. Transition from a fragmented approach to one defined by coordinated execution, as capital and hyperscalers are increasingly mobile and impatient.

Gupta and Maniar Shah are the India Managing Director and Director, respectively, at BowerGroupAsia.

China’s growth divide is getting wider Bloomberg News

China’s consumer-sensitive sectors are lagging further behind growth in industries linked to manufacturing and technology, illustrating a sharp divide in an economy increasingly exposed to foreign demand. While the sector spanning software and information technology increased over 11 per cent last year—the largest gain among all industries tracked by the National Bureau of Statistics—expansion in hotels, catering, and retail trade softened to the weakest levels of the post-pandemic era.

The outcome is a skewed economy where emerging new industries are struggling to compensate for the fragility of older growth drivers. Key details regarding this widening divide include:

• Manufacturing vs. Construction: Manufacturing picked up to a four-year high of 6.1 per cent, shored up by surprisingly strong exports that helped factories manage domestic deflation. In contrast, construction was the only industry to suffer a drop in 2025.
• Real Estate Stagnation: The property sector recorded a negligible gain of 0.2 per cent following years of deep contractions.
• Export Primacy: Booming exports helped the economy meet President Xi Jinping’s annual growth target of approximately 5 per cent. However, the economy remains vulnerable due to a lack of strong domestic demand and uncertainty over global trade.
• Expert Analysis: Jacqueline Rong, chief China economist at BNP Paribas SA, stated that gains in emerging industries have not been sufficient to offset the downturn in cyclical sectors. She noted that downward pressure will persist unless real estate stabilizes, leading to expectations that overall economic growth will moderate.

Beijing appears unlikely to implement a massive stimulus or countenance a major appreciation of the yuan, as rate cuts tend to weigh on the currency. Economists anticipate only incremental easing through the remainder of the year as the "export juggernaut" maintains its primacy.

Subdued growth in smartphone market to continue in 2026 on rising memory costs.

The weak growth seen in the Indian smartphone market during 2025 is expected to persist through 2026. Analysts predict the market will slow further as shortages of specific memory storage components drive up prices and consumer upgrade cycles continue to lengthen. As 2026 begins with rising memory costs that show no sign of abating, average selling prices (ASPs) are expected to climb, which will likely decrease volumes in the lower-to-mid segment (sub-₹15,000) while increasing market premiumisation.

Key details regarding market performance and forecasts include:

• Shipment Trends: Global tech research firm Omdia reported that India’s smartphone market shipped 154.2 million units in 2025, representing a 1% annual decline. For 2026, Omdia expects a mid-single-digit decline as higher prices and limited incremental value in new models delay consumer upgrades. Counterpoint Research similarly anticipates a 2% decline in 2026, noting the market has been stuck at approximately 152 million units for four consecutive years.
• Rising Input Costs: The price of 64GB RDIMM (registered dual in-line memory module) storage, which was approximately $450 in Q4 2025, is projected to reach $700 by March 2026. Due to these costs and dollar movements, ASPs for Android smartphones are expected to rise 15-18% in 2026, a significant jump compared to the 10% increase seen in 2025.
• Barriers to Growth: Several factors are hindering new smartphone sales, including a lack of feature phone upgrades and the growth of the secondary/refurbished market. Additionally, users are now holding on to their existing smartphones for longer periods.
• Market Stability Requirements: Sanyam Chaurasia, Principal Analyst at Omdia, noted that with cautious consumer demand, retail execution—including inventory support, localized sell-through programs, and promoter strength—will be essential for maintaining stability.

While shipments remained flat or marginally down in 2025, IDC suggests that the decline in 2026 could potentially be even higher.

Indian space-tech firms win big overseas as credibility soars

Exports are rapidly emerging as a key growth engine for Indian space-tech start-ups, signaling a decisive shift from an ecosystem once primarily driven by domestic demand. As ISRO-led credibility deepens, cost competitiveness improves, and flight heritage builds, these start-ups are increasingly winning international customers and transitioning from national missions to global markets.

Several companies are leading this international expansion:

• Manastu Space: This start-up now derives approximately 40 per cent of its revenue from overseas markets, with significant traction in the US, Europe, Japan, Singapore, and Australia. While it currently routes exports through direct contracts, it is in discussions to forge OEM partnerships to serve government defense orders.
• Dhruva Space: CEO Sanjay Nekkanti aims to position the firm as a strategic supplier of critical systems to tier-1 OEMs globally, reporting active engagement with customers in France, Austria, Australia, and the Middle East. The company provides space-grade solar panels and satellite subsystems, and expects international business to eventually account for 40 per cent of its order backlog,.
• Digantara Industries: CEO Anirudh Sharma notes that Indian start-ups are increasingly recognized as credible global suppliers, with international customers engaging them as long-term strategic partners to co-develop mission-critical systems for defense and intelligence.
• PierSight: This firm is seeing overseas demand driven by differentiated capabilities, specifically its SAR+AIS-based persistent ocean surveillance, which fills a global gap.

Beyond topline growth, having a balanced mix of domestic and international customers allows start-ups to command stronger valuation premiums. Experts note that companies like Pixxel, which serve both markets, benefit from order books that reflect both market and technical de-risking. This transition is described as a transformational moment for both the industry and the country as a whole.

The few bright spots for India’s slowing IT sector

The $285-billion Indian IT services industry, which employs approximately 5.8 million people, is currently navigating a period of "glacial growth" driven by macroeconomic headwinds, cautious client spending, and prolonged decision-making cycles. Despite these challenges, India remains central to delivering technology services at scale, with several key areas and strategies emerging as pockets of resilience.

Key bright spots and trends identified in the sector include:

• Areas of Steady Demand: While discretionary projects are often deferred, there is consistent demand for cloud migration, cybersecurity, and data analytics as enterprises continue to modernize digital infrastructure.
• Sector-Specific Traction: Digital transformation programs within the healthcare, BFSI (Banking, Financial Services, and Insurance), and manufacturing sectors have shown selective traction.
• Large Deal Wins: Significant contract wins remain a highlight; Infosys reported a Q3 total contract value of $4.85 billion, and TCS maintained a strong order book of $9.3 billion. Additionally, Tech Mahindra recently bagged a five-year contract worth over $500 million from Spanish telecom major Telefónica O2.
• The AI Pivot: Industry leaders believe a shift toward AI-led solutions will help the sector regain its momentum. India's deep talent pool is considered a critical asset, though the nature of work is changing: many entry-level jobs are being automated, shifting the human focus to overseeing mission-critical software.
• Productivity through Automation: Automated coding platforms, such as Anthropic’s Claude Cowork, are enhancing productivity by allowing engineers to focus on higher-value design and innovation rather than repetitive coding.
• The Rise of GCCs: Global Capability Centres (GCCs) have become a stand-out growth driver in an otherwise gloomy phase. India now hosts over 2,000 GCCs employing nearly 2 million people. A recent example is L’Oréal SA’s plan to invest ₹3,500 crore in a new hub in Hyderabad, joining other multinationals like McDonald’s and Heineken that utilize India for critical functions like R&D and analytics.

While the sector is not yet "out of the woods," these specialized areas and the continued influx of global centers suggest a structural shift toward more premium, AI-enabled delivery models.

Power bills may rise in new tariff regime.

Electricity bills for consumers across India could begin rising automatically every year starting next fiscal, regardless of political reluctance at the state level. The Union Power Ministry has proposed index-linked tariff revisions in its draft National Electricity Policy (NEP) 2026, released nearly two decades after the original policy was issued in 2005. Under this framework, tariffs will automatically reflect costs if State Electricity Regulatory Commissions (SERCs) fail to issue annual tariff orders before the start of each financial year.

Key details of the proposed tariff regime and its impact include:

• Automatic Monthly Adjustments: The NEP stipulates that any increase in power purchase costs incurred by distribution companies (discoms) must be automatically passed on to consumers on a monthly basis. To manage these cost fluctuations, the ministry has recommended that discoms establish stabilization funds, which could lead to even higher monthly bills for users.
• Reduction of Cross-Subsidies: The policy proposes a progressive reduction of cross-subsidies, ensuring that no category of tariff falls below 50% of the average cost of supply. Currently, the average electricity supply cost in India is approximately ₹6.82 per unit, while households pay an average of ₹6.47 per unit and the industry pays significantly more to subsidize residential and agricultural categories.
• Elimination of Regulatory Assets: State commissions must ensure that tariffs fully reflect actual service costs without creating "regulatory assets"—a practice where regulators accept expenditures but defer their inclusion in current tariffs. These deferred costs currently burden the Indian power sector with approximately ₹3 trillion.
• Impact on Households: Experts anticipate that fixed charges paid by household consumers will rise significantly under the new mandate for cost-reflective pricing.
• Industrial Competitiveness: Power Secretary Pankaj Agarwal noted that Indian industrial tariffs (roughly $105 per MWh) are much higher than those in Thailand, the US, and China ($60-80 per MWh). The policy suggests exempting the manufacturing sector, metro rail, and Indian Railways from certain surcharges to keep them globally competitive.
• Service Standards and Compensation: For the first time, the policy aims to establish a consumer-centric framework with a 24x7 supply mandate. Licensees will be required to publicly share service quality data and pay adequate compensation to consumers for failure to meet performance standards or for non-compliance.
• Infrastructure and Future Goals: The NEP targets increasing per capita electricity consumption to 2,000 kWh by 2030 and over 4,000 kWh by 2047, up from 1,460 kWh in FY25. To achieve this, India will require an estimated investment of ₹200 lakh crore by 2047 for generation, transmission, and distribution.

The draft policy is intended to address the persistent financial strain on discoms, which saw 15.04% of electricity supply turn into technical and commercial losses in FY25. By enforcing tariff discipline and market-based procurement, the government seeks to move the sector toward long-term financial viability and energy independence.

AI-led cyber threats expose deep security talent crunch

India is currently facing a severe shortage of cybersecurity engineers needed to protect critical infrastructure, including power grids, telecom networks, banking systems, and government frameworks. While the country has approximately 350,000 cybersecurity professionals, the actual demand is for one million engineers, according to data from staffing firms Adecco and Quess IT Staffing. This talent gap has remained persistent even as the pool of professionals grew from roughly 300,000 in 2023.

The scale of the threat is being driven by artificial intelligence, which has allowed attackers to become more sophisticated and automate their tactics. According to the Data Security Council of India’s 2025 report, detections of behaviour-based cyber threats in India jumped from 13 million in 2022 to 54 million by the end of 2024, a more than fourfold increase. Experts note that while basic triaging can be automated, higher-level threats require greater skills that are currently scarce in the workforce.

Key factors contributing to this crisis include:

• Reactive Defense: Cyber defense remains reactive while AI helps attackers automate and scale their efforts.
• Persistent Attacks: The use of AI-powered coding tools has made cyberattacks far more persistent.
• Skilling Dearth: Most available training consists of short-term certificates or workshops lasting only a few days, rather than deep degree programs required to certify high-level roles like Chief Information Security Officers (CISOs).
• Grassroots Training: There is a stated need for a "cyber cadre" where state-level training is provided at a grassroots level.

Despite the talent crunch, salaries remain highly competitive. A cybersecurity engineer with five years of experience earns an average of ₹20 lakh per year, while senior-level engineers with a decade of experience can command up to ₹60 lakh per year.

To address the supply gap, the government and private sector have launched several initiatives. Cert-In operates training programs, including an eight-week professional development course in partnership with BITS Pilani. Furthermore, Sisa Infosec partnered with Meity and Cert-In to launch an intensive workshop known as Certified Security Professional for Artificial Intelligence (CSPAI). However, industry leaders warn that the pace of skilling has not yet kept up with the rapid escalation of AI-led threats.

With $1 bn AI data centre bet, L&T takes on Indian giants

Larsen and Toubro Ltd (L&T) is placing a billion-dollar bet on data centres, banking on its unique ability to control costs by owning land, physical infrastructure, and servers. India’s largest engineering and construction firm believes this end-to-end ownership will allow it to offer some of the cheapest services in the market, even as demand for data centres soars due to the global push for artificial intelligence (AI).

Key details of L&T’s strategic expansion include:

• Capacity Targets: The group expects to scale its data centre capacity from the current 32MW to 200MW by 2030.
• Navi Mumbai Project: On Wednesday, L&T laid the groundstone for a new 40MW data centre in Navi Mumbai, Maharashtra. This project is part of a plan for over 200MW in capacity with a net capital outlay of ₹10,000 crore ($1.2 billion).
• Vyoma and Hardware: L&T recently renamed its cloud and data centre business as Vyoma. To support its hardware needs, the firm is leveraging its 21% stake in IT infra firm E2E Networks, which will be a primary contributor of servers.
• Conglomerate Competition: By maintaining tight in-house control over all stages of operations, L&T aims to gain a cost advantage over rivals such as the Adani, Reliance, and Tata groups. The firm will also leverage existing enterprise ties built by its tech outsourcing arms, LTI-Mindtree and L&T Technology Services.
• Comparative Outlays: While L&T’s current bet is significant, it appears conservative compared to peers; TCS has announced a 1GW data centre with a $6.5 billion outlay, Adani is partnering with Google on a $15-billion centre, and Reliance has unveiled details for an $11-billion, 1GW joint venture.

Prashant Jain, head of L&T’s corporate centre, noted that the firm possesses the "full stack" to be a digital infrastructure provider, emphasizing that clients are increasingly drawn to L&T’s sovereign platform offerings. L&T’s leadership believes that its engineering forte and integrated model will be the decisive factor in facing rivals in the rapidly expanding AI data centre segment.

10 critical milestones for India’s Reform Express

On December 30, Prime Minister Narendra Modi announced that "India has boarded the reform express," signaling a new generation of reforms designed to modernize institutions, simplify governance, and ensure long-term inclusive development. While 2025 was the most significant year for reforms since the 1991 liberalization—marked by a restructured GST, unified labour codes, and a revamped Income Tax Act—experts argue this is only the beginning of an arduous journey to escape the middle-income trap.

India currently enjoys a "goldilocks period" of high economic growth (8.2% in Q2 FY26) and low inflation (1.33% in December 2025). however, to sustain this momentum in an increasingly protectionist global environment, economists have identified 10 critical milestones for the reform agenda:

• Land Reforms: Current land transactions involve multiple authorities, opaque processes, and high stamp duty rates that vary by state. The Confederation of Indian Industry (CII) has suggested a GST Council-like structure to achieve political consensus and co-ordinate reforms across states to unlock rural development and manufacturing potential.
• Agricultural Reforms: Addressing primitive practices and poor market access is essential to revive productivity. Reforms must tackle misdirected subsidies that have become fiscally costly and market-distorting to ensure food security and alleviate rural distress.
• Labour Reforms: While the government has consolidated 29 central laws into four labour codes, they are not yet fully operational. The milestone involves finalizing and notifying rules at the state level to ensure the codes effectively expand social security and simplify compliance.
• Judicial Reforms: Inefficient dispute resolution and massive backlogs in courts cost India an estimated 0.28% in annual GDP growth. Milestone progress requires better infrastructure, more judges, and a stronger alternate dispute redressal system.
• Insolvency Law Reforms: While the Insolvency and Bankruptcy Code (IBC) has resolved ₹26 trillion in bad debts over nine years, it faces delays and high "haircuts" for lenders. The IBC Amendment Bill 2025 is a key milestone to address cross-border insolvency and process costs.
• Educational Reforms: Five years after the National Education Policy (NEP) 2020 was introduced, it has had only a marginal impact on the ground. The focus must shift to implementation in higher education to ensure India’s demographic dividend is not wasted.
• Healthcare Reforms: Public investment in healthcare remains low at 1.2% of GDP. A critical milestone is boosting this spending to 3%–5% to address the chronic shortage of nurses, doctors, and hospital beds.
• Deregulation: Tighter regulations "suffocate" industry. There is an urgent need for a continuous process of reducing regulations across all departments to lower compliance costs and make domestic manufacturing globally competitive.
• Fiscal Roadmap: The government needs to transition from powering growth through public spending to a sustainable debt model. A milestone objective is a clear roadmap to reduce national debt from 57% of GDP to less than 50% by March 2031.
• Trade Strategy: As the world turns insular, India must use Free Trade Agreements (FTAs) to open new markets. This includes incorporating sunset clauses or review mechanisms in trade deals to ensure they keep pace with technological and geopolitical shifts.

Experts warn that the "Reform Express" faces an uphill journey because many of these milestones—particularly land, agriculture, and education—require the active support of state governments in India’s federal structure. Success will depend on executing reforms as a continuous, perfectly sequenced process rather than in "fits and starts".