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How did Mumbai turn our data centre hub?

Mumbai has a 53% share of India’s data centre capacity. It has multiple subsea cable landing stations, and its status as the financial capital with a robust technology ecosystem has created strong demand for secure, high-capacity infrastructure. Reliable power, government incentives and land availability in Navi Mumbai have helped.

Global cloud providers like AWS, Microsoft and Google chose Mumbai as their hub to support various tasks such as advanced AI workloads, e-commerce, banking and media. Its connectivity and ecosystem make Mumbai indispensable, despite growing concerns about water scarcity.

India’s super rich in a hunt for the next SpaceX

By Salman S.H. Bengaluru

Indian family offices and wealthy investors are widening their bets on private US frontier-technology and artificial intelligence (AI) companies after the SpaceX initial public offering (IPO) gave them a clearer sense of the scale of returns and the size of the market. These investors bet privately on SpaceX through wealth managers and structured deals, using special purpose vehicles (SPVs) and funds. The paper returns on SpaceX-linked bets range from 20x to 100x, but these gains will remain unrealized until positions are unwound after the lock-in period ends.

Viram Shah, chief executive officer (CEO) and co-founder of Vested Finance, said some Indian investors who entered SpaceX through its platform are doing well on paper. He pointed to two funds done last year at $45 and $50 per share, which are now roughly 2-3x on paper. The SpaceX IPO, priced at $75 billion at a $1.77 trillion valuation, emerged as the biggest listing in history and reset expectations around what private-market winners can become.

“There is tremendous interest in the space of unlisted investments outside India, especially in the US,” said Gautami Gavankar, president of Kotak Mahindra Bank Ltd. She said Indian investors are betting on AI, defence tech, semiconductors and autonomous technology. “This is an evolved-investor trend, where wealthy Indian clients, including family offices and UHNIs, are increasingly willing to go offshore for differentiated opportunities,” she said.

Industry executives and people familiar with the deals said the next wave of Indian interest is shifting beyond the cluster of large language model (LLM) companies to names such as Stripe, Whoop, Revolut, Shield AI, Anduril, Epic Games and Kraken.

FOMO and Diversification Demand is not limited to a few marquee AI names and has risen sharply over several months, driven by fear of missing out on the global AI and technology rally, particularly in the US, according to Yogesh Kalwani, head of investment at InCred Wealth. “We are seeing interest across a broader basket of US frontier-tech companies spanning AI, defence tech, semiconductors, autonomy and other use-cases where AI is being applied, not just the large language model layer,” Kalwani said. He noted that relatively muted returns from Indian markets over the past two years have also pushed wealthy clients to diversify globally.

Average ticket sizes for individual Indian investors have largely remained in the range of $150,000 to $200,000, while family office investments can easily run into the $50 million to $100 million range. Viram Shah noted participation from family offices in Bengaluru, Mumbai, and Delhi, as these investments provide a way to enter at an earlier stage of value creation.

The appeal is especially strong for companies like:

• Whoop: Fitness tracking company last valued at about $10 billion.
• Revolut: Fintech firm valued at $75 billion in a late-2025 capital raise.
• Shield AI: Defence-tech company valued at $12.7 billion in its latest funding round.
• Epic Games: Video game company valued between $28.7 billion and $31.5 billion in past rounds.

Investment Structures and Exit Challenges Investors typically look for secondary-market opportunities through pooling vehicles set up offshore by fund managers or specialist administrators. These SPVs or offshore funds pool money from multiple investors to buy into a targeted company. The structure is typically long-duration and illiquid, with exits depending on future secondary sales, acquisitions, or public listings.

Exit timing is usually determined by the fund manager, who must balance lock-in periods and regulatory requirements. Even after an IPO, the money does not return in one shot; only a small portion of locked-up stock becomes free after the first earnings report, with more shares becoming available for redemption over a 180-day period.

Refiners eye concessions with Iran oil ready to flow

Rising global oil supplies may trigger concessions, deferred payments

By Rituraj Baruah New Delhi

As a temporary US sanctions waiver revives the prospect of large-scale Iranian crude imports into India once again, local refiners expect Tehran to offer sweeter terms—deferred payments and longer credit periods—to regain share in the world’s third-largest oil-consuming nation.

As Indian refiners await clarity on the payment mechanism and the long-term durability of the US-Iran peace talks, they may not rush for immediate procurement of Iranian crude. Instead, they are taking a more long-term approach to ensure supplies when sanctions are permanently waived.

Sanctions Waiver and Recent Trade The developments follow a 60-day sanctions waiver issued by the US Treasury Department's Office of Foreign Assets Control (OFAC) on June 22, permitting the production, sale, and transport of Iranian crude and petroleum products until August 21. India had already imported about 133,000 barrels per day of Iranian crude in April following an earlier 30-day sanctions waiver announced in March.

Before US sanctions hit in 2019, Iran was among India’s top five crude suppliers. In FY10, it shipped 22.1 million tonnes of oil to India—about 14% of the country's total imports. Today, however, Iran seeks to re-enter a market crowded with increasing supplies from Venezuela and West Africa, while Russian crude continues to dominate India’s import basket with discounts of up to $5 a barrel.

Expectations for Concessions Indian refiners view Iranian crude as logistically convenient and familiar, but any significant return will depend on commercial attractiveness. Refiners are looking for concessions such as longer credit periods; before sanctions, Iran offered up to 90 days, compared with the roughly one-month terms typically extended by suppliers from Saudi Arabia and the UAE.

“With growing supplies, it may soon become a buyer's market where Iran would look at giving concessions including deferred payments with a long tenure, even if not as high as 90 days, and even discounts to compete with other suppliers,” said a former executive with a state-run oil refiner. This outlook is supported by International Energy Agency (IEA) projections that global crude oil supply is set to rebound by 8 million barrels per day (bpd) next year.

Operational and Geopolitical Hurdles Experts note that while the waiver is positive, payment remains the biggest hurdle. Until 2011, purchases were settled through the Asian Clearing Union, which has since been discontinued. While the OFAC notification allows for US dollar-denominated payments, refiners remain cautious.

Tehran has already begun signalling its intent to compete more aggressively. Iran cut its July crude oil premium for Asia to $7.15 a barrel above the Oman/Dubai benchmark average, a sharp drop from the $13 premium charged in June.

The lifting of sanctions comes at a critical time as the US has warned of fresh sanctions on Russian oil, currently India's largest supplier. Iranian supplies could provide a much-needed diversification for India, which imports roughly 90% of its crude requirement. However, the durability of the US-Iran deal remains a concern due to deep levels of mistrust between the two sides.

The indirect cost of scanty rains

By Harsha Jethmalani

The south-west monsoon, which accounts for nearly 70% of India’s annual rainfall, got off to a sluggish start amid El Niño conditions, raising risks for crops, prices, and rural demand. During 1–23 June, cumulative rainfall was 42% below the long-period average, according to the India Meteorological Department. The spatial distribution is also worrying, with broad-based deficiency, and central India is the worst affected.

Weak and uneven rainfall in key sowing states raises risks to kharif crop output, given that much of the sowing takes place in July. A delayed and deficient monsoon can hit reservoir levels, food inflation, rural incomes, and consumption. Given their weight in the retail inflation basket, high food and fuel prices tend to compound inflation pressures.

India has faced El Niño-led rainfall shortages in the past. “In FY15 and FY16, India had a large monsoon deficit of 12% and 14%, respectively, cutting kharif crop output by 2.3% in FY16,” said Gaura Sen Gupta, chief economist at IDFC First Bank. However, consumer price index (CPI)-based food inflation eased to 4.9% in FY16 from 12.1% in FY14. Over time, the link between monsoon performance and food inflation has weakened, she said, aided by better government management of food supplies and minimum support price interventions.

The correlation between rainfall variability and economic growth has also weakened. A gradual shift from an agrarian to a services-led economy, expansion of irrigated land, stronger food stock buffers, and improved reservoir levels have all helped cushion the impact. Rajani Sinha, chief economist at CareEdge Ratings, said 13 of the 23 years since 1951–52 in which agricultural gross value added (GVA) declined occurred during El Niño years. But 20-year rolling regressions show a declining sensitivity of both agricultural and overall GVA growth to rainfall deviations, she added.

Still, there are indirect but sharper repercussions of poor rainfall that do not fully show up in headline inflation or GVA data. Higher food and fuel inflation can erode purchasing power and dampen consumption, particularly in rural areas. Tractors, entry-level passenger vehicles, motorcycles, fast-moving consumer goods (FMCG), consumer durables, and microfinance are among the most exposed. “Historical evidence suggests that these categories typically experience demand slowdowns during periods of elevated food inflation and weak monsoon conditions,” said a Motilal Oswal Financial Services report.

Amid El Niño conditions, which are also associated with higher temperatures, upside risks to food inflation are emerging from fruits and vegetables, particularly tomatoes, potatoes, and onions. Prices of cereals, pulses, oilseeds, and vegetables have already risen month-on-month in June. Against this backdrop, Bloomberg consensus estimates for FY27 retail inflation have risen from 4% at the beginning of the year to 4.9%. At its 5 June policy meeting, the RBI cut its FY27 growth projection to 6.6% from 6.9% and raised its inflation forecast to 5.1% from 4.6%. A prolonged El Niño into the second half of the year could also weigh on the rabi sowing season.

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sidebar highlights:

• ripple effect: Higher food and fuel inflation can erode buying power, hit consumption, chiefly in rural areas.
• exposed sectors: Tractors, budget PVs, motorcycles, microfinance and FMCG are among the most vulnerable.
• Trouble brewing: Consensus estimates for India’s FY27 retail inflation are revised higher.
• Feeling the heat: Rural-focused product categories are more vulnerable to inflation-led consumption weakness.

How a crypto exchange became a hub for illicit Iranian cash

By Dylan Tokar and Will Briskin

Earlier this year, crypto sleuths found an alarming series of transactions tied to two digital wallets controlled by the Central Bank of Iran. Tracing backward, investigators discovered the wallet’s funds were linked to $1.5 billion that North Korean hackers stole from the crypto exchange Bybit. After reaching the Iranian wallets, the money flowed through a complex maze of transactions.

CoinEx, an 8-year-old exchange founded by a Chinese engineer, has played a growing role in connecting Iran’s crypto operations to the wider world, according to blockchain data. Since 2019, wallets with an identifiable link to Iran have moved more than $3.84 billion through CoinEx. The exchange operates largely outside the reach of the U.S. and connects Iran’s domestic economy to the global crypto ecosystem. CoinEx agreed to exit the U.S. market after being fined in 2023 by New York’s attorney general.

Based in the Seychelles, CoinEx maintains a transaction monitoring system and screens for high-risk users. Although it had been widely used by Iranians, the exchange stated it does not have a relationship with the Iranian government. Recently, the firm began taking steps to distance itself from the Iranian market, including blocking new users with Iranian IP addresses.

Digital assets are popular among everyday Iranians seeking to trade for profit and avoid the deterioration of the rial. Researchers estimate that around 13% of Iran’s population own cryptocurrency, participating in a market valued at $8 billion to $10 billion in 2025. CoinEx built a presence within Iran and at times employed business-development managers to recruit users, though the company denied knowingly hiring such personnel.

The U.S. has attempted to limit exchanges working with Iran, penalizing Binance in 2023 for allowing Iranian customers. While Binance's exposure fell as it improved controls, CoinEx replaced it by 2024 as the largest foreign counterparty to Nobitex, Iran's largest domestic crypto exchange. Nobitex was sanctioned by the Trump administration in June 2026 for allegedly supporting the Iranian government.

Wallets hosted by CoinEx also processed transactions for Alireza Derakhshan, an Iranian allegedly involved in a sanctioned oil sales network. Furthermore, money flowed through wallets attributed to Zedcex, an exchange connected to Babak Zanjani, a self-identified strategist for the Revolutionary Guard’s (IRGC) sanctions evasion operations. Treasury actions sanctioned both Derakhshan and Zanjani, though transactions involving CoinEx occurred before these actions.

Iran’s cryptocurrency market was severely disrupted in late February 2026 due to military attacks that prompted internet blackouts. Yet, during this period, the average size of transactions between CoinEx and Nobitex actually increased. CoinEx attributed its recent distancing from Iran to the "stakes getting higher" following the Nobitex sanctions. While TRM Labs analyzed over $763 million moving between the two entities last year, CoinEx disputed the aggregation of these volumes, stating that estimates from other providers were lower.

PSU banks asked to deepen rural reach

By Harsh Kumar New Delhi

The Union finance ministry has asked public sector banks (PSBs) to accelerate their rural expansion and ensure access in villages with a population of more than 3,000. This push to strengthen the rural presence of state-owned lenders is intended to protect their customer base as private banks, small finance banks, and digital financial service providers steadily expand beyond urban markets.

The focus is on ensuring that larger rural habitations remain adequately served by physical bank branches, which continue to play a critical role in deposit mobilization, lending, and the implementation of government welfare programmes.

Expansion Progress As part of this exercise, banks were tasked with opening 576 branches in villages with a population exceeding 3,000 during FY26. According to a government official, 511 of these branches have already been opened, while 65 are still waiting to become operational.

While India had roughly 640,000 villages according to the 2011 census (of which nearly 597,000 were inhabited), larger villages with populations above 3,000 serve as vital economic centres for surrounding areas and generate enough banking activity to support full branch operations.

The Importance of Physical Branches Despite the rapid growth of digital banking and UPI transactions, physical branches remain essential for deepening financial inclusion. "Rural customers continue to depend on branches for opening accounts, availing agricultural and retail loans, completing know-your-customer requirements, accessing government schemes and resolving service-related issues," a senior banking official noted.

For the banks, these areas remain a key source of low-cost deposits and a critical market for priority-sector lending. Experts, such as Charan Singh of the EGROW Foundation, believe the time to reap benefits from these investments is now, citing increasing rural prosperity driven by:

• Higher Minimum Support Prices (MSP).
• Direct transfer of resources to farmers and women.
• Government initiatives like PM Gramin Awas Yojana and programmes focused on fisheries, dairy, and animal husbandry.

How low-hanging fruit could give India outsized gains

By Puja Mehra & Arpita Mukherjee

The Iran conflict has made two things clear: One, a new wave of globalization is coming, like it or not, from which further such shocks can’t be ruled out; and two, dependable dollar inflows from export earnings need to grow handsomely.

In preparation of these new realities, India is striving to secure diverse export markets and integrate its economy into global supply chains. Besides obvious economic gains, this deepening of economic integration will also help increase India’s strategic choices, reduce risks and build leverage in geopolitical relations.

A good way of growing Indian exports is to reduce trade costs, which are very high at present, especially for small and medium enterprises (SMEs). India’s global ranking based on the Logistics Performance Index (LPI) has gone up from 44th in 2018 to 38th in 2023, while its score in the United Nations Global Survey on Digital and Sustainable Trade Facilitation (UNTF) has also improved. In cross-border paperless trade, India’s score rose from 28% in 2015 to 67% in 2021, but has stagnated since then; this calls for policy intervention.

Greater adoption of cross border paperless trade is the low-hanging fruit that can reduce trade costs by nearly 25%, according to UNESCAP (2025), resulting in significant gains in export competitiveness. The strategic imperative is even greater, perhaps. Countries like China and Republic of Korea are doing capacity building within the UN Cross-border Paperless Trade Agreement (CPTA) framework to help developing and least developed countries in setting up IT systems that can facilitate cross-border clearances, which India is missing out on. New Delhi had played a leadership role in designing that agreement.

India’s trade agreements have paperless trade provisions too. In practice, our trade facilitation regime has moved beyond basic compliances and can be characterized as TFA-plus. The World Trade Organization’s Trade Facilitation Agreement (TFA) took force in 2017 as its first multilateral pact. It encourages members to simplify and harmonize customs procedures, enable faster clearance of goods at borders, improve transparency and predictability in trade processes, and adopt e-trade systems. India ratified it in 2016 and has undertaken several reforms since to align its procedures with it.

Legal infrastructure is also taking shape. The Digital Trade Facilitation Bill of 2026 has proposed legal recognition of e-trade documents such that they are admissible as traditional paper trails. Legal legitimacy apart, it will align with the UNCITRAL Model Law on Electronic Transferable Records to allow cross-border e-bills of lading, e-bills of exchange, promissory notes and warehouse receipts, and also aid cross-border regulatory harmonization and document exchanges.

The Union budget for 2025-26 had announced a BharatTradeNet stack. This unified digital public infrastructure-based stack for international trade documentation and financing solutions is expected to integrate all stakeholders through an interoperable digital ecosystem. That will take care of the technical infrastructure needed to operationalize a single-window system at home that is interoperable with other e-trade platforms.

Indian Customs is modernizing its systems. Domestically, the country has fully implemented paperless-trade measures under the UNTF, reflecting much progress made in digitalization. The Indian Customs Electronic Data Interchange Gateway, Ice-gate, set up in 2007, serves as a central hub for all electronic interactions between Customs and traders. The department’s Single Window Interface for Facilitating Trade of India has been operational since 2016.

We would argue that by acceding to international frameworks such as the UN CPTA, India will be able to leverage its digital infrastructure and institutional capacity to make Asia-Pacific-wide gains. Even if some gaps remain, India can take more initiatives and push for cooperation on paperless trade with Customs in neighbouring countries like Sri Lanka or Bhutan. Customs in India and Bhutan can work on a pilot project for real-time sharing of data and information to help reduce trade anomalies and check informal trade.

There’s a business case for the Indian IT sector to make a bid for exporting trade-tech services to the Asia-Pacific region, potentially building a common platform across this geography seamlessly. In a security-wise uncertain environment, India’s interests will be served well if our technology firms can do that, as they are well placed to. Several elements of the architecture needed for digital trade, such as legal preparedness and technological interoperability with trade partners, are already in place.

How RBI’s new framework seeks to protect you from mis-selling by banks

It seeks to change how banks sell insurance, loans, investment products, both through branches, digital platforms

By Aprajita Sharma

Ahmedabad-based Ashok Parekh lost his 32-year-old daughter to cardiorespiratory arrest aggravated by covid pneumonitis. She had taken a home loan of ₹32 lakh from a private sector bank. "As far as I know, she was told to mandatorily buy an insurance policy that would take care of the outstanding loan amount if something happened to her. She paid ₹75,000 as premium for it," Parekh said.

After her death, Parekh approached the insurer only to discover that the policy was a critical illness cover and not a life insurance policy. Since cardiorespiratory arrest was not covered under the policy, the claim was rejected. "Most importantly, we were under the impression that the policy covered a death scenario. Why were we sold a policy by a health insurer rather than a life insurer?" he said.

The suitability of insurance has been the biggest casualty of the way banks sell it. Data from the Irdai Annual Report 2024-25 show that grievances related to Unfair Business Practices increased by nearly 14% year-on-year to 26,667 in FY25. The Reserve Bank of India (Commercial Banks— Responsible Business Conduct) Second Amendment Directions, 2026—issued this month—is important. It seeks to reshape how banks sell insurance, loans and investment products, via branches and digital platforms.

What the RBI framework says One of the most significant provisions is a crackdown on sales-linked incentives. Banks must ensure that their internal policies and compensation structures do not encourage employees to push unsuitable products. RBI has also asked banks to bar their employees from receiving any direct or indirect incentive from third-party product providers, such as insurers or mutual fund firms.

The framework also prohibits forced bundling. A bank cannot make the purchase of an insurance policy or any other third-party product a condition for sanctioning a loan. Even where insurance is required for risk mitigation, borrowers must be free to purchase it from an insurer of their choice.

To prevent customers from unknowingly purchasing add-on products, banks will have to obtain explicit consent through a signed declaration, OTP-based approval, or digitally recorded confirmation. Banks will also have to assess suitability based on factors such as age, income, financial literacy, and risk tolerance. If mis-selling is established, the bank will need to refund the full amount and compensate the customer for losses.

The regulator has also targeted dark patterns in banking apps and websites, such as pre-selected insurance add-ons and hidden charges. Telemarketing rules have been tightened as well, restricting contact to between 9 a.m. and 7 p.m. and requiring explicit consent for home or office visits.

A shift to accountability Banks have until 1 January 2027 to comply with the new framework. Lokanath P. Kar, founder of ElpeeCo, noted that the message from RBI is clear: banks should not view insurance primarily as a revenue-generating tool. Creating required audit trails will increase compliance costs, potentially forcing banks to shift from volume-driven sales to responsible selling.

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RBI’s new rules against mis-selling by banks

What banks can no longer do:

• Force you to buy insurance, mutual funds or other products to get a loan.
• Push unsuitable products just to meet sales targets.
• Sell products without explicit customer consent.
• Use pre-selected add-ons, hidden charges or misleading digital prompts.
• Call or visit customers outside prescribed norms or ignore DND requests.
• Use dark patterns and deceptive app designs to dupe customers.

What banks must do:

• Obtain explicit consent through signed declarations, OTPs or recorded confirmations.
• Assess product suitability based on age, income, financial literacy and risk profile.
• Allow customers to choose products separately when multiple products are offered.
• Put in place a code of conduct for employees and sales agents.
• Maintain records showing what was disclosed and how consent was obtained.

What counts as mis-selling:

• Selling unsuitable financial products.
• Providing incomplete or misleading information.
• Selling without consent.
• Forced bundling of products.

Customer rights if mis-selling is established:

• Refund of the amount paid for the product.
• Compensation for losses as per bank policy.
• Stronger evidence requirements on banks to prove informed consent.

Careful planning can help India take on its inflation challenges

By Himanshu (Associate professor at Jawaharlal Nehru University and visiting fellow at the Centre de Sciences Humaines, New Delhi)

Not so long ago, the Indian economy was described by the finance ministry and the central bank as being in a ‘Goldilocks’ scenario, which is characterized by low inflation and high growth. The primary driver was a sustained period of low and declining inflation, which incidentally also led to higher real economic growth even though nominal growth had been decelerating. However, estimates of inflation in the last six months have placed a question mark on such claims.

Consumer price index (CPI) data released this month confirmed apprehensions of inflation trending higher. Overall inflation was reported at over 3.9% for May, with rural inflation at nearly 4.3% outpacing the 3.5% urban inflation rate. The trend in food inflation was worrying, with its rural measure almost at 4.9% and urban just short of 4.7%. In both, food inflation outpaced overall inflation. Some of this was expected, given our supply disruptions amid the West Asia war, but inflation stayed under the Reserve Bank of India’s (RBI) 4% target. With the government passing on a limited rise in fuel prices, the transport sub-group saw an inflation rate of just 1.75%.

However, estimates of the wholesale price index (WPI) released for May show significantly higher inflation at 9.7%, with a rising trend since April’s 8.3%. The WPI series, like other statistical indicators, has been updated to base year 2022-23. Unlike the CPI data, its highest sub-group inflation rate was that for fuel at 30.3%. Wholesale food inflation was estimated at 4.5% but showed a faster rise than CPI estimates. What should worry policymakers is its sharp rise over the last six months; WPI inflation was a little over 1.7% in 2024-25, declining to 0.4% in 2025-26. Food inflation last fiscal year was -3.7%, a sharp drop from 7.5% the previous year.

What the CPI and WPI data confirm is that, first, the period until December 2025 was one of sustained low inflation. Second, a rise in inflation, including for food, was taking place even before the West Asia war started. And third, the significant divergence between WPI and CPI inflation in the last two months suggests inflationary pressures building up at the retail level.

A major challenge for the government is the anticipated increase in inflation as 2026-27 rolls on. While uncertainty over the West Asia war seems largely over, we still have to contend with supply shocks due to deficient monsoon rainfall amid a strengthening El Niño phenomenon. As of 23 June, rainfall was deficient by 43% compared to the long-term average—among the highest for June. The supply shocks from declining output will drive food inflation, and an extended period of high temperature could even hurt the rabi (winter) agricultural crop.

Another driving factor is the rise in input costs, already visible in energy prices at the wholesale level. Input energy costs will increase as farmers use more ground water for irrigation in the absence of adequate rainfall, and fertilizer shortages are likely to add to these costs.

The government’s challenge is not just to insulate the population from an inflationary surge, but also to ensure employment and growth. Given that pressures are driven by food prices, monetary policies are unlikely to be of help; what is required is to ensure an adequate supply of essential food items. Fortunately, crop output has been high in the last two years, helping the government enhance its buffer stocks. However, policymakers must also ensure income and livelihood support in rural regions and consider strengthening the country’s employment guarantee programme.