Other Business Highlights - Newspaper Summary

 The sources reveal several critical "Other Business Highlights" in India's economic and business landscape as of September 2025, dominated by the widespread impact of GST reforms, significant shifts in capital flows and financial regulation, and corporate activity in automotive and specialized industries.

1. Impact of GST 2.0 and Consumption Surge

The recent "GST 2.0 reforms" are portrayed as a fundamental game-changer, designed to boost consumer confidence and consumption, leading to tangible results across various sectors.

Boost to Consumption and Premiumization

• The tax cuts lowered the simple average GST rate on essential consumption items from 11% to 9% under the new regime, providing a direct impact on consumer sentiment.
• This policy change is described as a "structural change in the economy" that will drive up domestic consumption and, consequently, GDP growth.
• Early trends across major e-commerce platforms confirmed this impact, showing a double-digit growth in sales year-on-year, surging by 23-25 per cent in the first two days of festival sales compared to a muted start the previous year.
• A key trend observed was premiumization, with strong demand for categories such as smartphones, large screen televisions, air-conditioners, and refrigerators. For Maruti Suzuki India (MSIL), the first day of GST 2.0 and Navratri saw them deliver more than 30,000 vehicles and secure over 75,000 bookings.
• The reforms are also expected to accelerate the shift from the unbranded segment to the branded segment, as the tax cuts put "extra money in the hands of the consumers," encouraging them to upgrade or move into newer categories.

Fiscal and Policy Implications

• The Finance Minister highlighted the GST reforms as prioritizing the "common man" and estimated the tax concessions would save households an estimated ₹48,000 crore at the first stage.
• However, the GST rate rationalization has raised major concerns from States, specifically Telangana and Kerala Finance Ministers, who argue it will severely compromise State finances, increasing their dependence on the Centre.
  • Telangana projected a loss of ₹6,500 crore to ₹7,000 crore, while Kerala projected a loss of ₹8,000 crore to ₹10,000 crore this fiscal year.
  • States are seeking a compensation mechanism and proposed levying an additional duty on sin and luxury goods to offset revenue loss.

2. Financial System and Capital Market Activity

Regulatory changes, financial flows, and corporate governance issues dominated the financial highlight section.

SEBI and Corporate Governance

• The Securities and Exchange Board of India (SEBI) is considering extending the facilities of Systematic Withdrawal Plans (SWP) and Systematic Transfer Plans (STP) to mutual fund units held in demat form, bringing parity with the statement of account mode.
  • Currently, demat investors must give repeated instructions for SWP/STP. The proposal involves a phased approach, starting with unit-based transactions and later moving to amount-based transfers.
• SEBI also issued a severe penalty against Gujarat-based Seacoast Shipping Services Ltd (SSSL) and its promoters for alleged fraudulent activities, restraining them from the capital markets for five years and ordering them to disgorge unlawful gains of ₹47.89 crore. The company was found to have published misrepresented financial statements, with over 85 per cent of sales recorded and 98 per cent of assets held in recent fiscal years being "not genuine".
• In the prominent case of the Adani Group, SEBI ruled that the company and its directors did not violate regulations on related party transactions (RPTs), insider trading, or market manipulation, according to legal principles based on the rules at the time (FY13 and FY21).
  • However, doubts remain over the intent, as small finance companies with negligible net worth were used as conduits for loans, transactions that were not disclosed in annual reports.
  • Crucially, SEBI has since expanded the definition of RPTs to include indirect transactions intended to benefit a related party, meaning similar deals would now come under legal scrutiny.

Financial Flows and Liquidity

• RBI officials noted that while non-food bank credit growth moderated during FY25, total financial resources flowing to the commercial sector increased due to a rise in funding from non-bank sources.
• This increase was driven largely by equity issuances amidst buoyancy in the domestic equity market, credit by Non-Banking Financial Companies (NBFCs), and a rebound in short-term external credit.
• The sources discuss the ongoing challenge of the "liquidity trap" in India, where RBI rate cuts (100 basis points since February) have not translated into widespread private investment due to surplus capacity and low demand.
• The government is responding with a Keynesian fiscal stimulus, combining the large capex push (₹11 lakh crore) with the income tax and GST concessions to boost demand.

3. Manufacturing, Logistics, and Automotive

Indian businesses are focusing on global expansion, EV infrastructure, and overcoming persistent manufacturing shortcomings.

Tool and Die (T&D) Industry Gap

• The Tool and Die (T&D) industry is identified as the "backbone" of modern manufacturing but remains critically under-recognized in India's drive for self-reliance (atmanirbharta).
• T&D produces the jigs, dies, and fixtures essential for sectors like automobiles, defense, aerospace, and electronics.
• India currently imports about 30 per cent of its tooling demand, primarily high-precision complex tools, often from China. This dependence leads to delays and vulnerability, affecting critical projects, including those for defense manufacturers.
• Experts urge the government to declare T&D a strategic infrastructure sector and launch a time-bound National Tool & Die Mission to address capacity gaps and reduce import reliance.

Automotive and EV Expansion

• The automotive sector shows active development, particularly in exports and electric mobility.
• Made-in-India Lamborghini golf carts, produced via a joint venture between India’s Kinetic Green and Italy’s Tonino Lamborghini, are set to be exported to the US from January or February. Kinetic Green noted India's tariff advantage over China in the US market.
• Electric motorcycle maker Ultraviolette is strengthening its global presence and resilient supply chain, diversifying components across Korea, Japan, Taiwan, and India, while keeping India as its core demand center.
• Union Minister Sarbananda Sonowal flagged off India’s first fleet of 50 electric heavy trucks with swappable batteries at the Jawaharlal Nehru Port Authority (JNPA).
• TVS Motor Company acquired Italian automotive design firm Engines Engineering S.p.A. for €5.05 million to establish a Global Centre of Excellence (CoE) in Bologna, Italy. This move aims to enhance speed to market, technological leadership, and expand TVS’s premium and electric portfolio.
• Ashok Leyland signed a 20-year agreement with China’s third-largest battery maker, CALB Group Co, planning to invest over ₹5,000 crore in seven to ten years to manufacture next-generation batteries, starting with importing cells and learning the assembly process.

Logistics Cost Reduction

• India’s logistics cost is estimated at 7.97 per cent of GDP in 2023-24 (and 9.09% of non-services output), according to a DPIIT report.
• This figure contrasts with commonly cited external estimates of 13-14 per cent of GDP, suggesting the growth pace of logistics costs is gradually slowing down due to government initiatives like PM Gati Shakti and infrastructure projects.
• The report identified rail logistics as the most cost-efficient mode (₹1.96 per tonne per km, excluding first/last mile), significantly lower than road transport (₹11.03).

4. Other Key Corporate and Policy Developments

• Balmer Lawrie & Co is planning a gradual exit from its refinery and oilfield services business because it is deemed "not viable" due to market pressure and competition from MSMEs.
• JLR Cyberattack British luxury carmaker Jaguar Land Rover (JLR) reported that sections of its digital estate are operational following a cyberattack. While JLR’s India operations remained largely unaffected, the attack threatened thousands of jobs and bankruptcy for smaller companies in the UK supply chain.
• Startup Funding Gurgaon-based fresh-commerce start-up Handpickd secured $15 million in Series A funding. Electric vehicle two-wheeler start-up Simple Energy secured $10 million in bridge funding.
• Trade Tensions and US Tariffs US tariffs imposed on Indian goods (25 per cent reciprocal tariffs imposed on August 7 and August 27) are likely to remain until the "thorny issue" of New Delhi's oil purchase from Russia is settled. India may attempt to appease the US regime by buying more oil from the US.
• Outward Remittances Decline Outward remittances under the RBI’s Liberalised Remittance Scheme (LRS) for all purposes declined by 10.9 per cent year-on-year in July 2025. Remittances specifically for studies abroad fell by 15 per cent in July 2025, and 48 per cent in the April-July 2025 period. This decline is attributed to students increasingly choosing locations other than the US, which are less expensive than an American education.