The article titled “Monsoon Dampener” in the front-page highlights corresponds to the following full report found on page 10 of the June 2, 2026, edition of The Hindu Business Line:
Govt lowers kharif fertilizer demand as IMD forecasts deficit monsoon rainfall
TAKING STOCK. Agriculture Ministry steps in after 20% of fertilizer subsidy had been exhausted in first two months WAR EFFECT. The subsidy may top ₹3 lakh crore in the current fiscal if the problem in West Asia persists till the end of kharif
Prabhudatta Mishra New Delhi
On a day the Agriculture Minister Shivraj Singh Chouhan launched a month-long farmer awareness campaign to reduce chemical fertilizers by engaging agriculture scientists in extension work, which is normally overseen by the States, the Centre announced that the demand for the five major crop nutrients has been reduced for the kharif season.
Briefing the media on the fertilizer situation after the geopolitical crises deepened with the Iran war on February 28, Aparna S Sharma, Additional Secretary in the Department of Fertilizers, said 20 per cent of the subsidy allocated for FY27 had been exhausted in the first two months of the current fiscal. But, she said that the Department of Fertilizers would raise the demand with the Finance Ministry as and when the subsidy is spent.
In the 2026-27 Budget, Finance Minister Nirmala Sitharaman had provided ₹1,70,944.53 crore for fertilizer subsidy, including ₹1,16,805 crore for the urea sector (both domestic and imported) and ₹54,000 crore for the phosphorus (P) and potash (K) sectors. In 2025-26, the fertilizer subsidy was pegged at ₹1,86,630.63 crore (Revised Estimate), which has since gone up due to the war-induced surge in global rates from March 1.
MONSOON IMPACT The fertilizer subsidy may exceed ₹3 lakh crore in the current fiscal if the problem in West Asia persists till the end of kharif because of the current high global prices of raw materials as well as finished products, an official said last week. He said that the subsidy could even reach ₹3.5 lakh crore if the current situation — high global prices and closure of the Strait of Hormuz — continues through the rabi season.
Sharma said that in view of the “below normal” monsoon forecast by the India Meteorological Department and the threat of El Nino, the Agriculture Ministry had lowered its demand estimate for the kharif season. Accordingly, urea demand, which was previously estimated to be 19.4 million tonnes (mt), has been cut to 19 mt, she said.
The IMD had actually forecast the monsoon rainfall to be “below normal” as early as in mid-April, and it recently reduced the quantity of rainfall by 2 percentage points — from 92 per cent of the long period average (LPA) to 90 per cent.
PLEA TO FARMERS The Additional Secretary said that fertilizer stocks stand at 51 per cent of the requirement for the kharif season, which is higher than the conventionally maintained 33 per cent due to advance stocking and improved logistics management. India’s fertilizer production was 10.48 mt post the West Asia crisis and with imports of 2.76 mt, total availability reached 13.24 mt during March-May, she said.
Meanwhile, Chouhan on Monday launched the nationwide “Khet Bachao Abhiyan” (Save the soil) from Ramasiya village in Madhya Pradesh under his parliamentary constituency. He appealed to the farmers to avoid the indiscriminate use of chemical fertilizers and pesticides and instead apply manure according to the soil’s requirements based on test results.
In the Inter-Ministerial briefing on the impact of the West Asia crisis on different sectors, Anupam Mishra, Additional Secretary in the Department of Consumer Affairs, said that the prices of cereals, pulses and sugar had remained stable, while that of potato, onion and tomato are range-bound, with no unusual volatility reported in the essential commodities.
Bank savings deposits fall sharply, term deposits increase
LUCRATIVE INTEREST. The proportion of term deposits in SCBs’ overall deposits increased to 61.6% at March-end 2026 from 61.1% at March-end 2025.
Our Bureau Mumbai
The composition of scheduled commercial banks’ (SCBs) aggregate deposits has undergone a structural shift over the last five years, characterized by a decline in the share of savings deposits and an increase in term deposits, according to RBI data.
This comes in the backdrop of savings deposit rates going down from 2.70/3.00 per cent in March 2022 to 2.50 per cent in March 2026, even as term deposit rates of more than one-year tenor rose from 5.00/5.60 per cent to 6.00/6.60 per cent in the same period.
The proportion of SCBs’ savings deposits declined from 34.6 per cent in March 2022 to 28.7 per cent in March 2026. In tandem, the proportion of term deposits, which usually attract higher interest rates, ascended from 55.2 per cent to 61.6 per cent during the said period.
The proportion of term deposits in SCBs’ overall deposits increased to 61.6 per cent as of March-end 2026 from 61.1 per cent as of March-end 2025.
GROWTH MOMENTUM Simultaneously, the proportion of savings deposits and current account (CA) deposits in banks’ overall deposits declined to 28.7 per cent (from 29.1 per cent as at March-end 2025) and 9.7 per cent (from 9.8 per cent), respectively.
During FY26, public sector banks acted as the predominant driver of deposits accretion, accounting for 50.8 per cent of the incremental deposits, followed by private sector banks with a contribution of 38.6 per cent, according to the RBI’s Annual Basic Statistical Return (BSR) on Deposits with SCBs.
Growth (year-on-year/y-o-y) of deposits with SCBs accelerated during FY26 and stood at 11.5 per cent as of end-March 2026, compared to 10.6 per cent a year ago.
HOUSEHOLD SECTOR The RBI noted that although the share of deposits of the household sector moderated in the recent period, it remained the primary contributor, accounting for 59.3 per cent of total deposits as of end-March 2026.
On the other hand, the share of deposits held by the non-financial sector increased to 18.5 per cent in March 2026 from 17.7 per cent in March 2025, while the share for financial corporations rose from 6.8 per cent to 7.8 per cent in the same period.
DEPOSITS BY SIZE The central bank stated that within total term deposits, the ‘₹1 crore and above’ size-class accounted for 46.3 per cent as of end-March 2026, mainly driven by the ‘₹5 crore and above’ size-class, which contributed 34.8 per cent. The share of term deposits up to ₹5 lakh stood at 17.8 per cent.
The share of term deposits with an original maturity of one to three years rose steadily to 69.8 per cent in March 2026 from 50.4 per cent in March 2022, whereas the proportion of term deposits with a maturity of up to one year fell to 8.8 per cent from 16.7 per cent during the same period.
The article titled “As Diplomacy Drags...” in the front-page briefs refers to the following full report found on page 9 of the June 2, 2026, edition of The Hindu Business Line:
Iran and US trade strikes, Kuwait comes under fire as diplomacy drags on
Reuters Dubai
Iran and the US said they had both carried out strikes on military targets, and each accused the other of acting aggressively as diplomatic efforts to end three months of war drag on.
The US military said it had, at the weekend, struck Iranian air defences, a ground control station and two drones that were threatening ships after “aggressive Iranian actions”, including shooting down a US drone over international waters. Iran’s Islamic Revolutionary Guard Corps (IRGC) said on Monday it had targeted an air base used by the US in response to an attack on southern Iran.
It did not identify the base, but Kuwait activated air defences on Monday and denounced Iranian missile and drone attacks, which it said were undermining efforts to reduce tensions in the region.
ISRAEL PUSHES DEEPER
Oil prices, which have risen sharply since the start of the war, gained more than 3 per cent on Monday after the strikes. Tensions were also fuelled by Israel ordering troops to move further into Lebanon against Tehran-backed Hezbollah, in a conflict that was reignited by the US-Israeli war against Iran.
The US and Iran have sporadically exchanged strikes since a ceasefire took effect in early April, while Pakistan has been mediating efforts to secure a more durable agreement. An exchange of strikes last Thursday was described in similar terms by each side.
The war launched by the US and Israel on February 28 has killed thousands of people, mainly in Iran and Lebanon. It has also caused global economic pain by pushing up energy prices since Iran effectively closed the Strait of Hormuz, a vital global supply route for oil and liquefied natural gas.
TRUMP’S CALL
In a late-night social media post, US President Donald Trump did not mention the exchange of hostilities, repeating his assertion that Iran “really wants to make a deal”. He berated critics, including what he described as “seemingly unpatriotic Republicans”, for negative “chirping” about negotiations to end the conflict. “Just sit back and relax; it will all work out well in the end - It always does!” he said.
Despite Trump’s remarks, Iranian Foreign Ministry spokesperson Esmaeil Baghaei accused Washington on Monday of constantly shifting its negotiating stance and condemned what he called US aggressive action. “Negotiations have started amid severe suspicion and mistrust, and the exchange of messages is taking place in this atmosphere,” Baghaei said.
“The other party is constantly changing its views and putting forward new or contradictory demands (...) it is natural that this situation will prolong negotiations,” he said, adding that Tehran viewed Israeli actions in the region, including in Lebanon, as inseparable from those of the US.
Berkshire Hathaway to buy Taylor Morrison for $6.8 billion
Bloomberg
Berkshire Hathaway will acquire Taylor Morrison Home Corp in an all-cash deal worth about $6.8 billion, the first major purchase under CEO Greg Abel and a vote of confidence in the US housing market. The offer of $72.50 per common share represents a 24 per cent premium to the home builder’s latest closing price on Friday.
It’s the largest deal since Berkshire bought Occidental Petroleum Corp’s petrochemical business in January. “We are excited to welcome Taylor Morrison into Berkshire’s portfolio,” said Abel. “We expect to unify our site-built homebuilding operations into a combined platform enabling us to deliver the dream of homeownership to more Americans”.
India, Oman ‘energise’ new economic corridor
ROBUST PACT. The CEPA creates a framework for a more resilient, synchronised and broad-based economic partnership.
RAJESH AGRAWAL
The commercial ties between India and Oman echo across centuries, a shared history carried on the sails of ancient dhows and sustained through generations of cultural exchange. The India-Oman Comprehensive Economic Partnership Agreement (CEPA) will further strengthen this civilizational bond. At a moment when global trade is navigating geopolitical rivalries, supply-chain disruptions and growing protectionism, the agreement reflects India’s determination to deepen economic integration with trusted partners. Following the landmark pact with the UAE in 2022, the CEPA firmly anchors India’s growing economic engagement with the Gulf.
Bilateral trade has steadily expanded, reaching $11.18 billion in FY 2025-26, while services trade stood at $863 million in 2024. Economic ties have diversified beyond traditional commodities to include engineering goods, pharmaceuticals, and IT services. Yet significant untapped potential remains. By covering trade in goods and services, investment, professional mobility, and regulatory cooperation, the CEPA creates a comprehensive framework for a more resilient, synchronised and broad-based economic partnership.
A GATEWAY FOR EXPORT GROWTH
The CEPA provides duty-free market access for Indian exports across 98.08 per cent of Oman’s tariff lines. Prior to the agreement, only around 15 per cent of India’s exports entered Oman duty-free under the Most Favoured Nation regime, while the remainder faced duties of up to 5 per cent. Under the CEPA, 99.38 per cent of India’s current export volumes now enjoy duty-free entry.
For Indian exporters, the gains are significant. Demand will be driven by Oman’s investments in infrastructure, logistics, and industrial diversification under Oman’s Vision 2040. Engineering goods exports, valued at $875.83 million in FY 2024-25, are projected to rise to between $1.3 billion and $1.6 billion by 2030.
The textile and apparel sector will also gain a significant edge over regional competitors through zero-duty access, helping revitalise labour-intensive clusters such as Tirupur, Surat, Ludhiana, and Coimbatore, while generating employment.
Opportunities are far reaching and diverse. Oman’s import-dependent pharmaceutical market presents strong prospects for Indian firms. Faster regulatory approvals, recognition of quality certifications, and duty-free access for key products will reduce compliance costs and improve market penetration. Agricultural and food-processing exports, including rice, processed foods, spices, and confectionery, will benefit too.
OPENING MARKETS
Consistent with India’s recent trade agreements, the CEPA follows a balanced and calibrated approach. While India is opening markets to strengthen competitiveness and integrate into global value chains, it continues to protect sensitive sectors. Key agricultural products such as dairy and cereals, along with industries including rubber, textiles and footwear, remain safeguarded. This approach combines external market access with protection against domestic vulnerabilities.
India has committed to liberalising over 77 per cent of its tariff lines, covering nearly 95 per cent of imports from Oman. This grants a competitive advantage to Oman’s core exports, particularly industrial inputs such as methanol and anhydrous ammonia. Oman secures preferential market access across a broad range of metals and alloys, allowing our countries to capitalise on lower production costs.
For sectors where India maintains defensive interests, Oman has been granted access through Tariff Rate Quotas. This mechanism allows preferential exports of products such as dates, marble, and selected downstream petrochemicals within specified volume limits. This carefully crafted integration strengthens competitiveness while supporting vulnerable sectors during transition.
TRADE, TALENT AND TRUST
CEPA offers Indian service providers binding commitments across sectors where India enjoys clear strengths, including IT, professional services and construction. With provisions allowing up to 100 per cent foreign direct investment in several areas, Indian firms will gain greater opportunities to expand their presence in Oman.
The agreement is also a breakthrough for talent. By raising the Intra-Corporate Transferee ceiling to 50 per cent, Indian firms now have the flexibility to seamlessly deploy specialised staff and deepen their entrenched market presence. Furthermore, for the first time in any FTA, Oman has established a dedicated mobility regime for independent professionals.
As global demographic shifts cause factory labour shortages and modern manufacturing increasingly partners with AI and robotics, this provision sets a powerful global precedent for Indian talent.
The CEPA also includes a dedicated healthcare annex that facilitates the integration of traditional systems such as Ayurveda into mainstream healthcare while streamlining licensing procedures for medical professionals. To top it off, a mandated Social Security Agreement negotiation will prospectively protect the Indian diaspora from the burden of dual contributions.
REGIONAL VALUE CHAINS
The India-Oman CEPA goes beyond tariffs by addressing non-tariff barriers through regulatory cooperation, harmonised standards and conformity assessment procedures. It reflects the high standards increasingly associated with India’s modern trade agreements and addresses many of the behind-the-border obstacles that impede commerce. India is laying the foundations for a more integrated regional trade architecture. Collectively, India’s FTA partners now account for nearly 67 per cent of global GDP and around 75 per cent of global imports in goods and services.
Oman occupies a unique geographic position at the crossroads of the Gulf, East Africa, and the wider Indian Ocean region. Omani logistics and industrial hubs such as Sohar, Duqm and Salalah can integrate value chains that combine Indian manufacturing expertise and talent with the wider Middle East and Africa. The result is a partnership built for regional connectivity and growth.
Trade agreements succeed when they create confidence—for businesses to invest, for workers to acquire new skills and for economies to build enduring partnerships. CEPA achieves precisely that, transforming a centuries-old relationship into a strategic economic partnership designed for the realities of the twenty-first century.
The writer is Union Commerce Secretary. Views are personal.
Can India reap AI gains?
Harsimran Sandhu & Susmi Routray
FRONTIER MODELS. India still trails the US and China. That hinges on having ownership of AI capability.
Artificial intelligence, particularly generative AI and agentic AI, is increasingly being positioned as the productivity engine of this decade. The promise is compelling: faster coding, automated customer service, instant research, lower operating costs, and smarter decision-making. For India, AI could unlock major productivity gains across industries. But the more important question is not whether AI will create value. It is: who will ultimately capture that value?
To understand this, one must look beneath the visible AI applications. At the core of generative AI lies the large language model (LLM), which powers chatbots, copilots, enterprise agents, retrieval-augmented systems (RAGs), and a growing ecosystem of AI applications. These systems work by processing massive volumes of text through transformer architectures and continuously predicting the next token to generate responses.
STRATEGIC LAYER
The real strategic layer, however, is the foundation model itself — the base intelligence layer on which AI applications are built. Today, this foundational layer is dominated by global technology firms such as OpenAI, Google, Anthropic, Meta, and leading Chinese AI companies.
Equally critical is compute infrastructure, particularly GPUs (graphics processing units). Foundation models require enormous parallel computing power for both training and inference. If foundation models are the brain of AI, GPUs are the engines that make them operational. Yet this layer too remains heavily concentrated, with Nvidia dominating advanced AI chips globally. This creates India’s strategic dilemma.
Indian businesses will inevitably adopt AI across customer service, coding, testing, HR, finance, marketing, legal review, and back-office operations. Firms will become faster and more efficient, while reducing operational costs. However, there is also the risk that India could simultaneously automate domestic jobs while paying foreign AI platforms for the intelligence powering those very systems.
In such a scenario, Indian companies may improve productivity, but the highest-margin value could flow outward — to the owners of foundation models, GPUs, cloud infrastructure, and AI platforms. India could emerge as a large consumer and implementer of AI, while core AI ownership remains concentrated abroad. This would create a new form of digital dependency.
India has begun responding to this challenge. Initiatives such as Sarvam.ai, Bharat Gen, and Gnani.ai represent important early steps towards sovereign AI capability. Yet these efforts alone may not be sufficient. India still trails the US and China in frontier foundation models, access to advanced GPUs, deep AI research ecosystems, cloud infrastructure, and large-scale private capital. However, India can build meaningful strengths in Indian-language AI, voice AI, and enterprise applications serving public-sector and domestic use cases. Catching up at the frontier level, though, will require sustained investment and long-term strategic commitment.
Therefore, the debate is no longer “AI or no AI.” The real question is whether India will remain merely a user of AI, or become an owner of AI capability.
India needs affordable AI compute, sovereign foundation models, high-quality domestic datasets, AI-ready public infrastructure, strong governance frameworks, and large-scale workforce reskilling. Indian IT firms must also evolve beyond manpower-based billing models towards AI-led, IP-led, and outcome-based platforms.
AI can undoubtedly become India’s productivity engine. But without domestic control over models, compute, data, and platforms, it may ultimately become a productivity engine for someone else.
Sandhu is Professor of Finance, and Routray is Professor of Information Technology Management, IMT Ghaziabad.
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