The latest official data shows that India’s real GDP grew 8.2% year-on-year in the second quarter (July–September) of fiscal 2025–26 the fastest growth rate in six quarters and well above market expectations.

What Drove the Strong Growth

• The secondary (industry) and tertiary (services) sectors led the expansion: manufacturing and construction in the secondary sector posted healthy gains, while services — including financial, real estate and professional services — saw double-digit growth at constant prices.

• Private consumption demand remained robust. Growth in real private final consumption expenditure (PFCE) surged compared to last year, signalling healthy household demand and consumption momentum.

• The growth came even before the full effect of recent policy measures (like tax / consumption-led reforms) had fully played out suggesting underlying resilience in economic activity.

What This Means for the Economy & Markets

This strong Q2 performance reinforces India’s standing as one of the fastest-growing major economies. It boosts confidence in the growth outlook for FY26, potentially supporting investor sentiment, corporate earnings, and capital-market performance. The broad-based nature of the growth (industry + services + consumption) also suggests a balanced economic expansion.

For businesses and investors, sectors tied to manufacturing, consumer demand, infrastructure, real estate and services may benefit the most — especially firms that cater to domestic demand or have strong service/consumption exposure.

Important Context & What to Watch

While 8.2% is impressive, a few caveats and signals warrant careful monitoring:

• Nominal GDP growth (i.e. GDP growth not adjusted for inflation) also rose — but the difference between real and nominal growth matters for corporate revenues, inflation-linked valuations, and fiscal numbers.

• The sustainability of growth will depend on whether private investment and capex pick up, along with stable demand — especially given external headwinds globally.

• Government policy support, global trade conditions, commodity price trends, and domestic consumption behaviour will significantly influence whether this growth momentum can be sustained going into H2 FY26 and beyond.

What It Implies for Your Clients & Advisory Strategy

• Long-term equity investors — Companies in manufacturing, consumer goods, infrastructure, real estate, and services may remain attractive; this GDP growth supports a structural growth story.

• Fixed-income and debt exposure — Strong economic growth could support creditworthiness of firms, but watch for inflation/interest-rate risks if demand-led inflation kicks in.

• Portfolio positioning — With growth accelerating now, a balanced mix of growth-oriented equity, infrastructure/industrial themes, and defensive bets could make sense — especially for medium-to long-term investors.

• Client communication — Emphasise that the economy seems to be recovering on a broad front (not just one or two sectors), which strengthens India’s growth credentials — but also highlight the need to watch for volatility from global and policy headwinds.

  Source: MoneyControl

In a recent review of regional registrars and directorates under Ministry of Corporate Affairs (MCA), Nirmala Sitharaman underscored the need for governance systems that are “easy, transparent and facilitative.” As part of the broader Viksit Bharat 2047 agenda India’s roadmap toward becoming a developed economy she emphasized modernising company-governance infrastructure and simplifying regulatory processes to make it easier to do business.

• A “futuristic, user-friendly” corporate-governance framework under MCA, with simplified procedures for company incorporation, exits (LLPs/companies), mergers and compliance.

• Creation of a real-time transparency dashboard for stakeholders — enabling quicker access to regulatory updates and company-registry data.

• Streamlining and harmonisation of forms, adjudication, inspection/investigation procedures, appeals and violation-compounding norms to reduce friction and speed up corporate processes.

• A shift in mindset: aiming for “maximum governance, minimum government,” so systems become facilitative rather than bureaucratic.

Why This Matters in the Context of Viksit Bharat 2047

The drive to modernise corporate-regulation frameworks feeds directly into the growth strategy underlying Viksit Bharat 2047. As documented earlier, achieving this long-term vision depends on a mix of private capital formation, public-private partnerships, strong institutional governance and ease of doing business.

Simpler, transparent and tech-enabled corporate systems could:

• Encourage more domestic and foreign businesses to set up or scale operations, boosting private investment and capacity build-up.

• Reduce compliance burden and red-tape, helping especially SMEs and new entrants — thereby broadening participation in growth.

• Enhance investor confidence through better disclosure, transparency and predictable processes.

• Support faster project execution, corporate restructuring and scaling — essential for sectors such as infrastructure, manufacturing, services, and green/clean-energy transition.

Implications for Investors, Businesses & Clients

For your role as a wealth manager and adviser:

• Sectoral and corporate-stock opportunities: Simplification of processes may lead to acceleration in corporate expansions, mergers, restructuring potentially unlocking value in mid- and small-cap firms or companies with turnaround or expansion stories.

• Improved ease-of-doing business boosts overall investment climate: This may enhance the promising long-term structural growth story of India a key part of client portfolios with long-horizon equity exposure.

• Reduced regulatory risk: Faster compliance, better transparency and clearer processes can reduce unpredictability which is favourable for risk-aware investors.

• SME & entrepreneurship potential: For clients or prospects considering business ventures, the more facilitative ecosystem lowers entry and operating barriers, supporting entrepreneurial investments, which could translate into new wealth-creation opportunities over time.

What to Watch Next

• Implementation speed: How quickly does the MCA roll out the real-time dashboard and simplified process architecture? The pace of execution will be critical to realise benefits.

• Regulatory follow-up: Further amendments, e-governance tools, streamlined digital forms and real world user feedback these will determine whether the simplification is substantive or cosmetic.

• Impact on corporate filings and ease-of-doing-business rankings: Improved metrics may validate the reforms.

• Business and investor response: Whether companies respond with increased investment and expansion, and whether investors show renewed interest in domestic growth-oriented equities and private-sector plays.

• Alignment with other aspects of Viksit Bharat 2047: Growth in infrastructure, renewable energy transition, private investments whether corporate-governance reforms reinforce these pillars effectively.

The push to make India’s corporate-regulation framework more modern, transparent and user-friendly marks a meaningful step towards the long-term goal of Viksit Bharat 2047. For investors, clients and businesses including those you advise it could improve ease of doing business, encourage more investment, reduce regulatory friction and reinforce confidence in India’s structural growth story.

Source: the Economic Times

In its November bulletin, the Reserve Bank of India (RBI) expressed growing confidence that a combination of fiscal, monetary, and regulatory measures introduced this year will help reignite private investment, boost productivity, and support long-term economic resilience.

Key Policy Drivers Highlighted by RBI

• Fiscal measures: The GST rate cuts and other tax incentives have helped lower consumer prices and stimulate demand.

• Monetary easing: The RBI notes historic-low retail inflation and robust liquidity conditions, creating favorable financial conditions for investment.

• Regulatory reforms: Significant regulatory changes are under way to make credit flow easier, improve banking-sector flexibility, and support business financing.

Macro Trends Supporting Private Capex

• High-frequency data for October indicates strong manufacturing and services growth, fueled by increased demand during the festive season and the positive impact of GST reforms.

• The external sector remains resilient: healthy foreign-exchange reserves offer a buffer against shocks, and strong remittances and services exports help maintain balance-sheet strength.

• Private capex is already showing momentum: as reported in the bulletin, capex projects sanctioned in Q2 have surged, especially in sectors like power, construction, and infrastructure.

Why This Matters for the Economy & Investors

• Virtuous investment cycle: According to the RBI, these coordinated measures could trigger a self-reinforcing cycle — more investment → higher productivity → stronger growth → even more private investment.

• Long-term resilience: By supporting both demand and supply, the RBI is laying the groundwork for durable private-sector-led growth rather than transient stimulus.

• Improved risk profile: Regulatory changes to ease credit may lower barriers for firms, especially medium and small enterprises, to undertake capex.

Implications for Clients & Portfolio Strategy

• Equity opportunities: Sectors like infrastructure, construction and capital goods could benefit significantly from a resurgence in private capex.

• Debt & credit exposure: The improved credit environment may open up attractive opportunities in corporate credit, especially for long-term investment plays.

• Client messaging: Emphasise that central-bank and government policy is aligned to catalyse private investment this is not just a short-term boost but a strategic push for longer-term economic strength.

• Risk management: Stay alert to external risks (currency, global markets) and regulatory execution risk the success of this cycle depends on sustained policy follow-through.

The RBI’s optimism around private investment is grounded in a well-coordinated policy push across fiscal, monetary, and regulatory dimensions. For clients and stakeholders, this presents a compelling case for recalibrating portfolios toward investment-oriented sectors while also keeping an eye on execution risk and macro volatility.

Source: MoneyControl

The RBI is under significant pressure to strike the right policy balance as markets increasingly expect a rate cut in the December monetary policy meeting.

Key Considerations

• Analysts suggest the RBI may wrap up its current easing cycle with a final rate reduction in December, acknowledging that inflation has eased and growth support is needed.

• While inflation has moderated, several risks remain: elevated global commodity prices, external shocks, and a weakening rupee all demand vigilance.

• Growth indicators show some resilience, but transmission of past rate cuts has been patchy and banks are yet to fully pass on lower rates to borrowers. l

• Therefore, the RBI’s decision is about more than just the rate number—it’s about signalling the end of one policy phase and preparing the terrain for the next.

Implications for Clients, Portfolios & Advisory Conversations

• For investors and advisers: A rate cut by the RBI could ease borrowing costs and boost liquidity, which may benefit sectors such as housing, consumer goods, and corporate credit.

• For fixed income portfolios: If the RBI cuts, bond yields may fall further, potentially supporting valuations but the key risk is whether the cut is large enough and whether banks pass it on.

• For client communication: Emphasise that while a rate cut seems likely, the RBI’s cautious stance means markets must manage expectations—policy transmission and external risks remain significant.

• For business-exposure discussions: Firms with high debt or low profitability may benefit from lower rates, but they should also gauge the impact of foreign-exchange and inflation risks which continue to linger.

What to Watch Going Forward

• Whether the rate cut is imminent in December, and if so, how large the cut will be (e.g., 25 basis points).

• The accompanying policy stance—whether the RBI shifts from “neutral” toward “accommodative” and signals a path for future loosening.

• How credit transmission unfolds post-cut: Are banks passing on rate reductions to end-borrowers, or are margins remaining sticky?

• External and inflation risks: If commodity prices spike, or the rupee weakens sharply, the RBI may delay or scale back easing to safeguard stability.

• The communication strategy the RBI’s guidance to markets and the clarity of its narrative will matter just as much as the rate number itself.

  Source: The Economic Times

The regulator SEBI is gearing up for a substantial regulatory review that will cover mutual fund (MF) frameworks and stock broker rules. At the board meeting scheduled for December 17, SEBI will examine proposals to modernise outdated regulations, enhance transparency and streamline compliance.

Key Proposals Under Review

• Unbundling of broking fees: For example, separating the execution fee from research or advisory components in broker charges.

• Revamp of the total expense ratio (TER) in mutual funds: Including excluding statutory levies (e.g., STT, GST, CTT, stamp duty) and brokerage/exchange/regulatory fees from TER limits.

• Updating the 1992 stock-broker regulations: These rules are about 30 years old and include parts that may no longer align with current markets (for instance, algorithmic trading definition is missing).

  Aimed at easing compliance burdens, removing redundant norms, and improving the ease of doing business in the capital markets.

Why This Is Significant

• For investors: Greater transparency in what they’re paying (broking fees, fund charges) helps with informed decision-making.

• For mutual funds and brokers: The changes could impact revenue models, especially if fee caps are lowered or cost structures re-defined. For example, the proposed cap reduction may affect profit margins for asset-managers.

• For the broader capital-markets ecosystem: Modernising regulation will help align India’s frameworks with global best practices, particularly in areas like algorithmic trading, risk management and disclosure norms.

  SEBI’s upcoming regulatory review signals a pivot toward greater transparency, simpler cost structures and modernised compliance in India’s investment ecosystem. For your role in wealth-management, this means staying alert to changes in fee structures, service models and cost implications and proactively guiding your clients about how these may impact their investments and advisory relationships.

  Source: The Economics Times

India’s foreign exchange reserves jumped by US $5.543 billion in the week ended 14 November, reaching US $692.576 billion, according to data released by the Reserve Bank of India (RBI).

Key Numbers

• Total reserves rose from about US $687.034 billion in the previous week to US $692.576 billion.

• The component of gold reserves increased by US $5.327 billion, taking gold holdings to US $106.857 billion.

• Foreign currency assets (FCA), the largest component of reserves, saw a modest rise of US $152 million to US $562.29 billion.

• Smaller components also improved:

  • Special Drawing Rights (SDRs) rose by US $56 million to US $18.65 billion.

  • The reserve position with the International Monetary Fund (IMF) increased by US $8 million to US $4.779 billion.

Why This Matters

• A rise in foreign-exchange reserves strengthens India’s external buffer, improving resilience against external shocks such as currency volatility, global trade disruption or sharp capital-flow shifts.

• The strong gain in gold reserves suggests that much of this increase was driven by revaluation effects (higher global gold prices) rather than fresh large foreign-currency purchases.

• Although FCAs rose modestly, the jump in gold positions indicates that valuation changes play a significant role in the weekly movement of reserves.

Implications for Clients, Portfolios & Business

• For clients concerned about currency risk (especially given India’s import exposure): a healthy reserves buffer is a positive sign, but does not eliminate exposure entirely.

• For businesses with significant import costs or foreign-exchange liabilities: the improved reserves position provides some comfort, but currency movements remain a risk.

• For equity and debt portfolios: tighter external buffers can support sovereign credit perceptions and may reduce risk premia; however, it remains crucial to monitor flows, policy action and the underlying drivers.

  Looking ahead, it will be important to assess whether future increases in India’s forex reserves are driven by fresh capital inflows, stronger export performance or valuation gains, rather than merely higher global gold prices. The composition of reserves also deserves close attention, particularly the share held in foreign-currency assets compared to gold, SDRs and IMF positions, as this mix influences stability and liquidity. Additionally, the relationship between reserves, the trade deficit, the current-account deficit and overall capital-flow trends will play a critical role in determining the sustainability of the external balance.

  Source: The Economic Times

The Finance Ministry has instructed key social-welfare departments to accelerate capital expenditure (capex) in the second half of FY26, aiming to ensure funds allocated for welfare reach their intended beneficiaries.

Key Highlights

• Welfare ministries including Social Justice & Empowerment, Labour & Employment, and Minority Affairs have only utilised 35–40% of their capex allocations in the first half (H1) of FY26.

• By contrast, infrastructure-led ministries (such as Railways and Defence) have spent a significantly higher share of their capex budgets.

• The slow pace in welfare spending is largely due to procedural delays, incomplete documentation, and state-level implementation hurdles.

• Social-sector capex in these ministries funds critical infrastructure: student hostels for SC/ST/OBC students, rehabilitation and elderly care homes, training facilities, and assistive-device infrastructure.

Why the Push Matters

• The Finance Ministry emphasises that small capital allocations for welfare cannot be deprioritised just because they are institution-focused.

• Officials say it’s not just about spending: the goal is full utilisation to make sure committed funds translate into tangible benefits for targeted populations.

• The ministry expects a sharp uptick in capex execution in December–March (H2), a period when such spending historically picks up.

Implications for the Economy and Stakeholders

• Credibility & Budget Efficiency: Better utilisation of welfare capex strengthens the credibility of the budget and ensures that social investments deliver real impact.

• Social Impact: Accelerated spend in welfare ministries could lead to faster creation of social infrastructure across states (such as care homes, training centres), directly benefitting marginalized communities.

• Policy Risk: If these ministries continue underspending, there may be a risk of avoidable savings — and, importantly, lost benefits for people who rely on welfare infrastructure.

• Investor Viewpoint: Investors may interpret this as a sign of the government balancing growth with social responsibility, but also watch for risks if key ministries fail to absorb allocated capital.

What to Watch Next

1. Revised Estimates (RE): How much of the unused capex is carried forward or reallocated in the RE for FY26.

2. Monthly Capex Data: Monitoring capex execution trends in H2 for welfare ministries will show whether the push is working.

3. State-level Execution: Since many welfare projects involve states, effectiveness on the ground will depend on state-Centre coordination.

4. Policy Reforms: Whether procedural bottlenecks (documentation, payments to NGOs) are addressed to improve capital spending efficiency.

5. Impact Metrics: Alongside money spent, assessing how many projects (homes, hostels, training centers) are completed on time would be a strong indicator of real social impact.

The Finance Ministry’s directive to fast-track welfare-sector capex underscores a dual commitment: not just high infrastructure spending, but also quality social investment. For our clients and stakeholders, this highlights that government capital deployment is not just about large numbers but about targeted, transformative impact in social sectors.

Source: MoneyControl

India’s export sector delivered a strong performance in the first half of FY26, with both Q1 and Q2 registering record-high export values. Despite global economic volatility and trade-related uncertainties, the country’s merchandise and services exports have demonstrated resilience and upward momentum. This strong start to the fiscal year highlights improving competitiveness, better integration into global value chains, and continued policy support for exporters.

Key Performance Highlights

• Q1 FY26 exports reached USD 209.0 billion, higher than USD 202.5 billion in the same quarter last year.

• Q2 FY26 exports rose to USD 209.9 billion, exceeding the previous year’s USD 193.2 billion and marking the highest quarterly export figure in India’s history.

• Total exports for H1 FY26 stood at USD 418.9 billion, compared to USD 395.7 billion in H1 FY25, reflecting nearly 6 percent year-on-year growth.

• Both goods and services exports contributed to the rise, supported by favourable global demand pockets and stronger sectoral performance.

Drivers Behind the Strong Export Growth

India’s export momentum was supported by several structural and cyclical factors:

• Strength in sectors such as electronics, especially smartphone shipments, which continue to benefit from PLI incentives and supply-chain realignment.

• Improved performance in agriculture and processed foods, backed by steady international demand.

• Resilient services exports, including IT, business services and consulting.

• Better global integration, with manufacturing shifting toward India as companies diversify supply chains.

Economic and Industry Implications

The continued rise in exports indicates improved resilience in India’s external sector. This trend offers positive implications for businesses, investors and policymakers:

• Supports economic growth forecasts, offering a buffer against global uncertainties.

• Strengthens India’s position in global trade, particularly in high-growth manufacturing segments.

• Creates investment opportunities in export-focused industries such as electronics, agro-processing, speciality chemicals and technology services.

• Enhances business confidence, especially for companies operating in international markets or planning to scale up export operations.

Key Trends to Monitor Going Forward

While the first half of FY26 sets a strong foundation, sustaining the momentum will depend on evolving global and domestic conditions. Important factors to watch include:

• Global economic slowdown risks and their effect on demand.

• Commodity-price fluctuations that may impact import bills and trade balance.

• Progress of trade agreements and logistics improvements.

• Sector-wise divergence, particularly between high-growth and lagging export categories.

  Source: MoneyControl

India’s current account deficit (CAD) is projected to widen to approximately 1.7% of GDP in the fiscal year 2025-26, up from earlier forecasts of 1.2%. This outlook comes from a recent report by the Union Bank of India.

Key Highlights

• The report states: “We expect a rise in current account deficit to 1.7 per cent of GDP in FY26, as global trade tariff pressures continue to keep the trade-deficit elevated.”

• Although lower global commodity prices—particularly oil—and strong service-exports remain tailwinds, elevated trade pressures and a widening goods trade deficit are the major risk factors.

• The CAD’s sensitivity to crude-oil prices remains high: every US$10 per barrel move in oil impacts the annual current-account balance by about US$15 billion.

Why This Matters

• A CAD of  1.7% of GDP marks a notable increase from recent years, signalling potential external-sector stress and possibly higher currency/financing risk.

• With the CAD widening, the country could face larger external-financing needs, putting pressure on foreign-capital flows and possibly increasing vulnerability to shocks (e.g., rising oil prices or renewed trade-tariff escalation).

• For investors and business-advisors, large CAD implies heightened focus on currency-risk, import-exposure, export-resilience and external-borrowings.

Implications for Clients, Portfolios & Businesses

• For clients: With external vulnerabilities rising, portfolios may need more diversification (including into assets less sensitive to rupee performance or external-shock risks).

• For businesses: Companies heavy on imports (particularly energy or commodity inputs) or reliant on exports may face margin or currency-headwind risk. Those with strong domestic-demand, low import-dependency may be better positioned.

• For wealth-managers: Emphasise monitoring of macro-indicators such as CAD, currency movements, and global commodity/energy price trends, in addition to the usual interest-rate/inflation risks.

What to Monitor Next

• Monthly and quarterly current-account updates to see if the 1.7 % figure is tracking.

• Crude-oil price behavior and global commodity trends, as they remain key determinants of India’s external balance.

• Progress in trade-deal negotiations (for instance between India and the USA), tariff actions or retaliations, which could affect goods-exports/imports.

• Signs of capital-flow stress, currency depreciation or higher cost of external-borrowing that might stem from a larger CAD.

The projected rise in India’s CAD to 1.7% of GDP in FY26 marks a caution-flag for external-sector vulnerability. For advisers and clients, this reinforces the need to monitor external-economy risks in tandem with domestic growth/interest-rate/inflation dynamics.

Source: The Economics Times

The Indian central government is expected to set the fiscal deficit target for the fiscal year 2026-27 at around 4.1 % to 4.2 % of GDP, modestly lower than the FY26 target of 4.4 %.

Key Highlights

• The projected target follows a fiscal deficit of approximately 4.8 % of GDP in FY25, and a target of 4.4 % in FY26.

• Government officials indicate the decision reflects a balanced approach: slower consolidation in order to continue supporting growth amidst external headwinds.

• This targeted range is designed to keep the central government’s debt-to-GDP ratio on a declining path, with a view to reaching around 50% by FY31.

• Capital expenditure (capex) will remain a priority, and the capex-to-GDP ratio for FY27 will likely not be lower than current levels.

Why This Matters for the Economy

1. Growth Support: By moderating the pace of fiscal consolidation, the government is signalling that growth will continue to be supported  especially through infrastructure spending and capital investment.

2. Fiscal Discipline Maintained: Although the target is not aggressively lower, the glide-path remains credible, aligning with long-term fiscal goals of lowering debt.

3. Investor Confidence & Sovereign Ratings: A stable and predictable fiscal roadmap helps reinforce confidence among investors and ratings agencies. Sustained reduction in the debt ratio is a key factor.

4. Implications for Borrowing & Markets: Lower fiscal deficit targets may moderate the government’s borrowing programme, which could have favorable implications for interest rates, bond yields and cost of capital.

5. Fiscal Flexibility: With the shift of anchor from purely deficit numbers to debt-to-GDP, there is increased flexibility in managing the quality of expenditure and restructuring of debt.

Implications for Businesses, Investors & Clients

• From an investment-advisory perspective:

  • Monitor sectors that are sensitive to fiscal stimulus (infrastructure, construction, capital goods)  these may remain beneficiaries under sustained capex.

  • Watch interest-rate and bond markets: a credible fiscal path could ease pressure on yields, benefiting fixed-income exposure.

  • For enterprises: anticipate a stable policy environment with continued government investment in infrastructure, but also moderate borrowing and controlled deficit growth.

• From a client-communication perspective: emphasise that while fiscal consolidation is ongoing, the emphasis on growth support means that the overall macro environment remains constructive — and this aligns with long-term wealth-accumulation goals rather than short-term panic.

• For risk management: stay alert to external shocks (global growth slowdown, commodity price spikes, inflationary pressures) which could force a deviation in the fiscal glide-path.

What to Watch Next

• The formal announcement in the upcoming budget for FY27 will give clarity on the exact deficit number, capex allocation and borrowing plan.

• How the government balances revenue mobilisation (taxes, non-tax receipts) and expenditure discipline will be key.

• Updates from ratings agencies: any commentary on India’s fiscal trajectory, debt ratios and sovereign rating outlook will affect markets.

• Macro­economic indicators such as GDP growth, inflation, external sector performance deviation from expectations could trigger fiscal adjustments.

The expected fiscal deficit target of 4.1 %–4.2 % of GDP for FY27 reflects a pragmatic compromise: maintaining fiscal discipline while not stalling growth momentum. For advisers and clients, this means staying invested with a long-term view, leveraging sectors aligned with capex and infrastructure, and managing interest-rate or inflation risk as part of portfolio strategy.

Source: MoneyControl