Category: Economy

India plans to attain a staggering 500 gigawatts (GW) of renewable energy capacity by 2030, Prime Minister Narendra Modi declared during his virtual presentation at Indian Energy Week 2025. He emphasised that the next two decades will be critical to developing India into a ‘Viksit Bharat’ (Developed India).

“Our targets may seem ambitious, but the past decade’s progress gives us confidence that we can achieve them,” PM Modi said.

He also emphasised India’s commitment to sustainability, noting Indian Railways’ goal of achieving net-zero carbon emissions by 2030. He says India’s rapid economic growth is inextricably linked to energy advancements.

“Experts around the world feel that the twenty-first century belongs to India. “We are not only propelling our own economy but also contributing to global growth,” he stated.

Modi laid up five critical pillars for India’s energy future: optimising internal resources, stimulating innovation, leveraging economic strength, improving energy trade, and committing to global sustainability.

Over 70,000 delegates and 700 exhibitors are expected to attend Indian Energy Week 2025, which takes place in Dwarka from February 11 to 14. Union Minister Hardeep Singh Puri emphasised the event’s focus on energy security, sustainability, and low-carbon technologies, confirming India’s status as a global energy leader.

France and the UAE intend to invest between €30 billion and €50 billion to build a 1GW AI data centre and fund other AI-related projects.

The declaration was made on Thursday, following a high-profile meeting between French President Emmanuel Macron and UAE President Mohamed bin Zayed Al Nahyan. The AI campus will be located in France, while the particular location has yet to be chosen.

The project will prioritise semiconductor development, AI talent cultivation, and virtual data embassies, which will contribute to the establishment of sovereign AI and cloud infrastructures in both countries.

Few details have been revealed, although rumours imply that the plan will be spearheaded by a Franco-Emirati group, which includes the MGX Investment Fund. MGX, which is backed by Abu Dhabi, is also a major investor in OpenAI’s Stargate initiative, which aims to invest $500 billion in US data centres over the next four years.

France is hosting an international AI event in Paris, where additional investments may be announced. The government has already identified 35 possible data centre sites and is offering fast-track permits. With nuclear power accounting for 65% of its electricity, France is establishing itself as a key hub for AI-powered data centres.

The UK government has pledged to create new nuclear energy project sites in England and Wales to accelerate the deployment of Small Modular Reactors (SMRs) and attract private investment. This initiative is part of PM Keir Starmer’s larger plan to decarbonise Britain’s electricity sector while maintaining energy security.

Starmer’s office announced the increase of the list of potential nuclear development locations, as well as measures to streamline planning procedures. “For decades, this country has failed to build new nuclear power plants.” “We’ve been let down and left behind,” Starmer said.

Successive British administrations have supported SMRs, which are tiny nuclear reactors meant to cut costs and planning delays when compared to large-scale units. However, no SMR projects have been built thus far.

Attracting private funding is an important part of Starmer’s economic development plan. His administration has already implemented substantial planning reforms to accelerate key infrastructure projects.

Currently, eight sites have been approved for nuclear development, but the new strategy encourages investors to submit more. There is also the option to locate SMRs near energy-intensive AI data centres.

Four companies are competing in a government-led SMR competition that began in 2023: Rolls-Royce, Westinghouse, Holtec Britain, and GE-Hitachi Nuclear Energy.

On Sunday, Egyptian Prime Minister Mostafa Madbouly met with senior Emirati ministers to discuss ways to strengthen economic cooperation. The discussions centred on the status of collaborative projects between Egypt and the UAE.

Vice Prime Minister for Industrial Development and Minister of Industry and Transport Kamel Al-Wazir, UAE Minister of Industry and Advanced Technology Sultan Ahmed Al Jaber, and UAE Minister of Investment Mohamed Hassan Al Suwaidi also attended the meeting. It was an important step towards strengthening bilateral relations and expanding economic ties between the two countries.

Prime Minister Madbouly greeted the Emirati delegation and underlined Egypt’s commitment to increasing cooperation. The Ras El-Hekma project, a key development on Egypt’s northwest coast, was a major issue of discussion. The $35 billion program, spearheaded by the UAE’s Abu Dhabi Developmental Holding Company (ADQ), seeks to turn the region into a smart, sustainable city.

The proposal comprises world-class tourism destinations, cutting-edge infrastructure, an international airport, and a high-speed rail network. By 2045, overall investment in Ras El-Hekma is estimated to top $110 billion.

Other important areas of cooperation were energy, data centres, and infrastructure development.

Africa’s primary copper producers, the Democratic Republic of the Congo (DRC) and Zambia, are aggressively negotiating deals to secure a foothold in metal trading. With demand for copper skyrocketing due to its use in artificial intelligence (AI) and green energy, these countries seek a larger part of trading earnings.

For decades, transnational businesses such as Glencore have dominated the metal trade. However, during the last year, Congo and Zambia have increased efforts to trade their own mined copper. These countries supply more than 13% of the world’s copper, making them major players in the worldwide market.

Gecamines, Congo’s state-owned miner, is in talks with Glencore to acquire approximately 51,000 metric tonnes of metal from Kamoto Copper Company (KCC). The finalisation date is unknown. Glencore has declined to respond.

Gecamines has also started trading approximately 100,000 tonnes from its 20% interest in Tenke Fungurume Mining, after a 2023 agreement with Chinese owner CMOC Group. Meanwhile, Zambia and Mercuria, a Swiss commodity trader, have formed a joint copper trading unit with a $500 million budget.

While these measures may boost government revenue, researchers caution that disagreements over pricing, trading rights, and investor trust may pose long-term issues.

India has slashed personal tax rates in its annual budget, hoping to encourage local consumption while global economic uncertainty persists. The PM Modi government increased the tax-free income threshold from 700,000 rupees to 1.28 million rupees ($14,800). Additionally, tax rates were reduced for persons earning more than this amount.

Finance Minister Nirmala Sitharaman remarked that the decision would increase the middle class’s disposable income, encouraging higher household spending, savings, and investment. On the other hand, this tax relief will cost the Treasury 1 trillion rupees (or $11.6 billion) every year.

The budget also included assistance programs for farmers, youth, women, and low-income individuals. Farmers would benefit from increased subsidised credit limits of 500,000 rupees ($5,778). To combat high food inflation, the government launched a nationwide campaign to promote high-yield crops such as pulses and cotton.

India’s fiscal deficit target for 2025-26 is 4.4% of GDP, with plans to borrow 14.82 trillion rupees. To stimulate financial sector growth, the government increased the foreign direct investment ceiling in insurance from 74% to 100%.

Shares of Indian real estate companies rose on Saturday after the government announced tax cuts to boost middle-class spending in Asia’s third-largest economy. The move is intended to increase investments in residential housing, benefiting homebuyers and developers.

Investors and economists are optimistic about the government’s proposal to decrease income tax rates in the 2025-26 budget. Experts anticipate the cutbacks will enhance disposable income and improve consumer demand, alleviating concerns about slow consumption in previous quarters.

Following the announcement, the Nifty Realty Index rose 3.3%, its highest single-day increase in nearly eight months. Most companies in the sub-index rose, with important real estate players including Prestige Estates, DLF, and Sobha jumping 2% to 6%.

According to an expert, the tax drop will increase demand for affordable housing. Middle-class homebuyers, landlords, and investors stand to profit from lower tax bills and greater affordability.

In a significant move, the government now allows homeowners to claim tax breaks on two self-occupied residences rather than just one. This change is projected to reduce tax burdens, promote homeownership, and increase real estate investment, particularly in second homes and Tier 2 and 3 cities.

The Union Finance Minister’s Budget 2025 speech on February 1 included a major tax overhaul with the new Income Tax Bill. The most notable reform is the entire exemption from income tax for earnings up to ₹12 lakh. Income tax rates have been altered, with the highest rate only applied to people earning more than ₹30 lakh yearly. These reforms are projected to dramatically reduce the tax burden for middle-class people.

Another critical step is to rationalise the tax deduction and collection rates and thresholds. The TDS exemption threshold for mutual funds is now ₹10,000, up from ₹5,000. Senior citizens would also benefit from the raised TDS threshold on interest income from bank savings.

Indirect tax reforms have streamlined tariff structures by eliminating seven tariff rates and leaving only eight. This is expected to increase compliance and revenue. The Budget also emphasises the government’s commitment to clean energy, with the establishment of the Nuclear Energy Mission, which aims to generate 100 GW of nuclear power by 2047.

On the fiscal front, the revised fiscal deficit for FY25 is expected to be 4.8%, followed by 4.4% in FY26.

According to official data released on Friday, India’s core infrastructure output increased by 4% in December 2024, slowing from the 5.1% rise registered in the same month the previous year. The drop in growth momentum was also noticeable monthly. In November 2024, the expansion was 4.4%, indicating a minor decline in December.

Natural gas production was one of the eight important infrastructure industries that had negative growth, adding to the overall slowdown. Coal, refinery products, fertiliser, and steel output growth have all slowed. Coal output increased by 5.3%, a decrease from 10.8% in December 2023. Similarly, refinery products, fertilisers, and steel saw growth rates of 2.8%, 1.7%, and 5.1%, respectively, compared to 4.1%, 5.9%, and 8.3% the previous year.

However, certain sectors demonstrated resiliency. In December, cement production increased by 4%, and electricity output increased by 5.1%.

Core sector growth in the current fiscal year was 4.2% from April to December, which was much lower than the 8.3% expansion registered during the same time previous year. The eight core industries account for 40.27% of the IIP, a major indication of overall industrial growth in the country.

India’s key stock indexes closed higher on Thursday, boosted by robust gains in state-owned enterprises and anticipation of more government expenditure in the impending Union Budget. The optimism in public-sector stocks outweighed falls in IT stocks and Tata Motors.

The Nifty 50 rose 0.37% to 23,249.5, while the BSE Sensex advanced 0.3% to 76,759.81. Despite the current rebound, the Nifty is still 11.5% down from its record high on September 27.

Analysts believe the latest rally is underpinned by “attractive valuations” in large-cap companies after a market correction, making them a safer long-term investment, according to Gaurav Bhandari, CEO of Monarch Networth Capital.

Nine of the thirteen major sectors finished the session in positive territory. State-owned firms expanded by roughly 2%, boosted by anticipation of increasing public sector investment in infrastructure. Reliance Industries, the second-heaviest stock on the index, rose 1.4%.

Meanwhile, IT stocks fell 1.1% after rising 2.6% in the previous session. Tata Motors fell 7.4% after reporting lower-than-expected quarterly profits, while Adani Enterprises fell 3% due to a steep profit reduction in its coal trading section.

However, Bajaj Finance climbed 2.1% due to strong loan growth.