Don't hold your breath.

 "India's year-on -year retail inflation rate, based on the Consumer Price Index (CPI), based on the revised base year 2024, stood at 2.75% in January 2026, compared to January 2025, according to data released by the Ministry of Statistics and Programme Implementation (MoSPI)." "The CPI base year has been revised from 2012 to 2024 using data from the Household Consumption Expenditure Survey (HCES)." The new series starts at 100 from 2024 and ensures that "the index remains representative of current household consumption patterns, price structures and the evolving nature of the Indian economy." ddnews.gov.in. The percentage of different items in the CPI basket has been adjusted to reflect the differences in spending by households between 2012 and 2024. Weight of food and beverages have been reduced from 42.62% to 36.75%, because of lower spending on food, while spending on Housing, water, electricity, gas and other fuels, Health, Transport, Education Services and Restaurants and accommodation services have exploded. Yet their weights have been increased only slightly. Finshots. While spending on restaurants and entertainment may be optional, housing, energy, health, transport and education are obligatory. Shouldn't they have higher weights? This government first came to power in 2014, with 282 seats (272 required for majority) in the Lok Sabha. wikipedia. Since then average inflation per calendar year has run at over 4% annually. rateinflation,com, CPI inflation is a comparison with the previous year's prices. This is the 'base effect'. Investopedia. CPI inflation was 4.98% last year and has fallen to 2.75% this year. This does not mean that prices have fallen but that they have risen 2.75% on last year's prices. So, inflation compounds over time. Core inflation leaves out volatile food and energy prices and perhaps gives a truer picture of the burden of rising costs on people. Investopedia. The government does not release the core CPI data but according to CEIC, core CPI inflation was at 3.375% in January 2026 over 4.98% in December 2025 and has averaged 5.362% from Jan 2012 to Jan 2026. CEIC. Which means that anything which cost Rs 1,000 in Jan 2012 would cost Rs 2,077 now. investor. gov. It would be helpful to be told the CPI inflation using the new basket of consumption as well as the old one so that we can compare, without the circus in 2019 when the government was suspected of massaging GDP back series data to show a higher growth rate compared to the previous Congress-led government. Acting chairman of the National Statistical Commission (NSC), PC Mohanan and member of NSC, J Meenakshi resigned in protest. Reuters. Prof Kaushik Basu, former Chief Economic Advisor to the Government of India, has recently visited various schools in Purulia in Bengal, Bangalore and in Pune and was impressed that "The discussions were rigorous and unsparing." His last visit was to Delhi. "There pouring over the latest economic data and listening to political leaders respond to mounting challenges with familiar slogans, my optimism began to fade. India's promise is undeniable and its talent abundant, yet politics and empty rhetoric continue to undermine prospects." Mint. It's not about base year, consumption basket or household spending but about whether the figures will be actual, or just for chest thumping, which no one will believe. Better not to hold our breaths.  

A humble request.

 Delhi proposes "the rollout of an AI-powered Integrated Traffic Management System (ITMS) that will use automatic number plate recognition (ANPR) cameras, smart traffic signals and automated challans." ET. A 'challan' is a traffic citation with a hefty fine (wikipedia) to collect as much ransom from long-suffering drivers as possible. Ironically, "While global tech titans and world leaders have gathered for India AI Impact  Summit 2026 at Bharat Mandapam in Delhi to discuss the future of artificial intelligence and seamless connectivity," several people, including delegates, "were forced to walk for kilometers after the event to find a cab as the entry of vehicles on the roads outside Bharat Mandapam was barred for VVIP movement and entry to the nearest metro station was closed." DH. While people outside were badly treated, "I was sort of confused and didn't know what I was supposed to do," Open AI CEO Sam Altman said, hours after his 'no handshake' moment with Anthropic CEO Dario Amodei. Amodei founded Open AI with Altman but left to found its competitor Anthropic. "Modi grabbed my hand and put it up, and I wasn't sure what we were doing," he said. Don't worry, Sir, the whole thing was just a photo-op to showcase the Great Man at great cost, part of which may be financed by challans on people whose daily lives were being completely upset. A VVIP, or a Very, Very Important Person, (wikpedia) is a very, very special subgroup of homo sapiens whose habitat is only in India, and is higher than the more common VIP, or Very Important Person, and who can do anything with total impunity, guarded by the police and special forces, ready to shoot if any citizen should dare to protest. While a VIP can shut a stadium to walk his dog, or demand superiority over our Gods, a VVIP can, and does, halt ambulances carrying critical patients to hospital, resulting in their deaths. News18. So why is Delhi Traffic Police unable to manage traffic? Because, "Against a sanctioned strength of 6,102  personnel. only 4,901 are currently in position." Of these, "on any given day, nearly 500 personnel are on leave, another 500 are diverted for special duties and VIP deployment," and the rest are gainfully employed catching anyone without a Pollution Under Control Certificate (PUC) which every vehicle must carry,to be renewed every year for new vehicles to every three months for older ones, upon payment of a fee to augment Delhi government's coffers. ddnews.gov.in. "The India AI Impact Summit 2026 has attracted investment commitments  of over $250 billion related to infrastructure, Union IT Minister Ashwini Vaishnaw said. Humble request to Messrs Pichai, Altman and Amodei: Please stay away from India. AI will only be used to increase the powers of the VVIP coterie and enslave us, the unlucky citizens of India. We will be most grateful. Thank you. 

Friendly, but for how long?

"Washington blinks, New Delhi benefits," "giving Indian exporters an edge over competitors from Bangladesh (20% tariffs), Vietnam (20%), Indonesia (19%) and China (37%), one can visualise a surge that will speed up India's fast-moving economic engine," wrote Sreeram S Chaulia. Critics are saying that India has lost its strategic autonomy by pledging to give up Russian oil, but, "The reality is that access to US markets, capital, know-how and technology is far more important for the Indian economy (and job creation) than any savings from Russian crude oil discounts," wrote Tanvi Madan. That is the long-term wish, but what happens to short-term revenue for the government. "Petrol tax in India consists of 55% of petrol's retailing price while diesel tax is 50% of of the fuel's retail value." cleartax.in. In January, "India's average crude oil imports cost fell below $60 a barrel,..among the lowest it has been in five years despite...sanctions against three major crude oil suppliers - Iran, Russia and Venezuela." HT. The government may levy a windfall tax on "The three state-run oil marketing companies (OMCs)...which "posted a combined net profit of Rs 340.67 billion in the first half of 2025-26, a 269.4% year-on-year jump that exceeded their full-year profit of Rs 336.02 billion in 2024-25." HT. The government of course squeezes enormous dividends out of the public sector enterprises (PSE) it controls. It has already received Rs 526.67 billion out of PSEs in the financial year 2025-26, which ends on 31 March. dipam.gov.in. "Geopolitics and geo-economics both suggest that our choice in the new G-2 world is to partner either with the US (with which we have a lot in common, starting with democracy) or with China-Russia," and "China's expansionist and mercantilist tendencies should be both contained and reduced," wrote Surjit S Bhalla. Hence, a partnership with the US will protect us. Or, will it? In 2010, during Barack Obama, "In the last three years, the US has provided 14 F-16s, five fast petrol boats, 115 self-propelled howitzer field artillery canons," ostensibly to fight the Taliban. India Today. In 2019, Imran Khan, then Prime Minister of Pakistan, said that the Inter-Servicea Intelligence (ISI) helped the CIA to kill Osama bin Laden in 2011. DH. In 2012, Obama won re-election for his second term in office. wikipedia. In the 1971 war between India and Pakistan, which led to East Pakistan becoming independent Bangladesh, President Richard Nixon discussed asking the Chinese to attack India and, possibly, use nuclear weapons to stop Indian advance. Dhaka Tribune. Russian submarines and ships put the US, UK and Austrlian navies to flight. India Times. Besides, the deal was necessary only because Trump had imposed a reciprocal tariff of 25% unilaterally and a penal tariff of 25% for buying Russian oil. There is no guarantee that Trump won't increase the tariff if he is dissatisfied with India's pace of reforms, as he did to South Korea, wrote Swaminathan Aiyer. China is our existential enemy, the US is fickle but Russia has been our proven friend. We are paying the US for its deal. Let's deal with Russia as well. A friend in need, a friend forever. 

Flow of liquidity.

In its December 2025 meeting, "The Reserve Bank of India (RBI) has slashed its repo rate by 25 basis points (bps) from 5.5% to 5.25%, but in the latest meeting in February, "The RBI has kept its key lending rate, known as the repo rate, unchanged at 5.25% in the first monetary policy decision since the budget." NDTV. "Given the impending revision in two key macroeconomic numbers - gross domestic product (GDP) estimates where the base year is to be brought forward to 2022-23 from 2011-12 at present and consumer price inflation (CPI), where the base is to be moved forward to 2024 from 2011-12 now - any other decision would have risked rocking the boat," wrote Mythili Bhusnurmath. In 2025, the RBI cut its policy rate by a total of 125 bps, from 6.5% to 5.25%, bringing the interest rate down by 105 bps on fresh bank loans and interest paid on fresh term deposits by 95 bps. ET. In addition, the RBI announced a reduction in the Cash Reserve Ratio (CRR) by 100 bps from 4% to 3% in tranches of 25 bps. This was expected to release Rs 2.5 trillion into the banking system. ET. CRR is the money commercial banks must deposit with the RBI without interest and cannot be used for lending or investment. (Kotak Bank). "According to the Economic Survey, average surplus liquidity in the system was a mind boggling 117 times that of the previous year." "What is left unsaid is that, as the government's debt manager, it will manage liquidity so that the government's borrowing goes through successfully and at a low cost." In its efforts to release more money into the system, the RBI has been buying government bonds. "The RBI has already stepped in aggressively this financial year, purchasing nearly Rs 7 trillion worth of bonds, a move that helped cap yields." Mint. By taking the government's debt on to itself the RBI is monetizing the fiscal deficit (BS). Creating fresh money to finance government spending is supposed to be inflationary but the RBI is probably reassured by the CPI inflation falling to an annualised rate of 1.33% in December 2025 (mospi.gov.in). In addition, "The Centre is budgeting a record Rs 3.16 trillion in dividend receipts from the RBI and public sector banks (PSBs) in 2026-27,..helping to keep the fiscal deficit under check. TOI. Last year, the RBI dished out a record Rs 2.68 trillion (newsonair.gov.in) and in 2023-24 it was another record Rs 2.11 trillion (Grip Investment). The bond market seems unimpressed with the RBI's liquidity flood. The benchmark 10-year bond yield is at 6.754%, down a tad from 6.769% on 02 February. investing.com. India's foreign exchange reserves may have been at a record $723.77 billion on 30 January (BS), but even this may not be enough if foreign investors take fright and the government runs up a big deficit because of loss of revenue from free trade agreements. The RBI was nationalised in 1949 (rbi.org.in), so it is paying the government. It is creating a flood of money but can it control the flood? Liquidity is liquid. It may flow out..      

Better to be monkey. Than hostile.

 Three days back, "A pit six meters long four meters wide and deep, dug by the Delhi Jal Board (DJB) on a service road in Janakpuri in West Delhi," resulted in the death of 25-year-old Kamal Dhayani, He was found next morning at the bottom of the pit, still wearing his helmet, with his motorcycle lying next to him. While, "Delhi Police officials said the bike could have fallen while trying to ride over the dug-up mounds of earth," "the DJB said that there was green mesh and safe barricading at the site." TIE. So, he must have committed suicide. Case closed. Many people saw the accident and the victim lying at the bottom of the pit but no one informed the police until a woman, Shivani, came on the scene. HT. It may be because most people feel that no one will be held responsible and they would be forced to turn into 'hostile witnesses'. "In India, in most cases involving the rich and the influential people or corrupt politicians, witnesses turn hostile, making the rule of law a mockery. Very often witnesses become untraceable. Sometimes they are just eliminated." Law Teacher. "While the sub-contractor, identified as Rajesh Kumar Prajapati, 47, was arrested...and booked for culpable homicide, the main contractor and the laborer, identified by his single name Yogesh, were absconding." HT. Delaying arrest gives time to contact influential friends, pay off key individuals and appoint a lawyer adept at seeking adjournments from polite judges. Criminal cases take and average of 5-20 years to resolve (jsrohilla.in) and this gives ample time for the accused to intimidate witnesses into turning hostile. In 2008, 13 year-old girl Aarushi Talwar and 45 year-old man Yam Prasad 'Hemraj' Benjade were murdered inside Aarushi's home, with doors locked from the inside, but no one was found responsible. wikipedia. In 2021, a 19 year-old lower caste woman was found in a field by her family "battered and bruised, barely conscious and naked from the waist downwards. Her spine was broken, she was bleeding and vomiting blood." "In her 'dying declaration', the 19-year-old told a magistrate that she had been gang raped and strangled and named four of her neighbors as the perpetrators." BBC. Three of the four men have been found innocent and one found guilty of a lesser charge. wikipedia. In 2006-07, bodies of 17 children were dug up in Nithari, a village in Uttar Pradesh. One Surinder Koli was found guilty of murder in 10 of the children and his employer Maninder Singh Pandher was found guilty of two, Both were sentenced to death by Allahabad High Court in 2023. wikipedia. In 2025, the Supreme Court found both men not guilty. BBC. In India, people are murdered by no one. It follows, therefore, no one is responsible for children dying by drowning in manholes which have been left open. "The National Crimes Bureau (NCRB) reveals a sobering reality: In India, one person dies every 12 hours from falls into open pits and manholes, with a staggering 5393 such deaths recorded since 2015." Inventiva. If you see nothing and hear nothing you will have to say nothing, or else, you will face serious hostility from goons. Could be labeled 'hostile'. Or end up in a pit. Better to be one of the monkeys. And alive.  

It's only Interim.

The India-US Joint Statement on a trade deal has been announced which brings down reciprocal tariffs on a range of Indian goods exported to the US to 18%. Reciprocal tariffs on a wide range of goods could be removed "subject to the successful conclusion of the interim agreement." "India intends to purchase $500 billion of US energy products, aircraft and aircraft parts, precious metals, technology products, and cooking coal over the next 5 years." pib.gov.in. A reciprocal tariff of 26% was imposed on India in the Executive Order 14257, published on 4 April 2025, which complained that "the United States has among the lowest simple average MFN (most favored nation) tariff rates in the world at 3.3%," India was charging a rate of 17%. - a rate of 70% on passenger vehicles, 80% for rice in the husk, 50% for apples and 10% for network switches and routers. Seems to have a point. At 18%, India will have an advantage over Vietnam (20%) and Indonesia (19%), wrote Arpita Mukherjee. "The deal comes at a time when exporters of labor-intensive products like garments, footwear and leather items were feeling the pinch of high tariffs imposed in 2025." "Under the agreement, India will remove or reduce tariffs on all US industrial goods and a broad basket of agricultural products, including dried distillers' grains, red sorghum for animal feed, tree nuts, fresh and processed fruits, soybean oil, wine and spirits." India Today. Red sorghum, or Lal Jowar, is already grown in India (gonefarmers.com), so why do we need to import it free of tariffs? While most goods sold in India come under the goods and services tax (GST) collected by the Union government, states levy their own taxes on alcoholic drinks. "It's estimated that taxes on liquor and beer fetch the state governments nearly Rs 900 billion annually." cleartax.in. Will states be free to levy their own taxes on American wine and spirits, which will raise their prices, and if not, will they have to reduce taxes on Indian wine and spirits so that they can compete? Commerce Minister Piyush Goyal "asserted that India's sensitive agricultural and dairy products sectors will continue to be shielded. He also clarified that no genetically modified products from the US will be allowed in India as part of the trade deal." TOI. "The joint statement says both sides have agreed to strengthen economic security alignment to enhance supply chain resilience and innovation through 'complementary actions'," which, according to Global Trade Research Initiative (GTRI) founder Ajay Srivastava "suggests that India's security and economic policies may increasingly need to align with those of the United States." TNIE. Reassuringly, "Adani Group Chairman Gautam Adani and his nephew Sagar Adani have hired prominent attorneys in the US - including one of Donald Trump's lawyers and a former Mafia prosecutor - to represent them in their defence against allegations of securities fraud leveled by the Securities and Exchange Commission." Mint. The Mafia and the Don, they should be safe. India is paying only $500 billion for the trade deal. Seems like a bargain. 

Expecting the unexpected.

The Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) kept its policy rate unchanged at 5.25% at its latest meeting yesterday. The forecast for economic growth was raised from 7.3% to 7.4% and that for consumer price index (CPI) inflation was raised from 2.0% to 2.1%. Mint. Earlier, the US Federal Reserve had voted to hold its lending rate at 3.5% to 3.75%, "citing still-elevated inflation alongside solid economic growth, ad giving little indication in its latest policy statement of when borrowing costs may fall again." Reuters. The hawkish outlook from the Fed meant that "The US dollar hit a two-week high...as fresh volatility gripped stocks and the pound tumbled after the Bank of England voted by a razor-thin margin to leave UK rates unchanged." Reuters.The rupee has strengthened by almost Rs 2 against the dollar, from 92.043 on 28 January to 90.596 to one dollar yesterday. Investing.com. Perhaps the RBI does not want any pressure on the rupee as traders look for risk-off investments. In good news, India's foreign currency reserves jumped to $723.8 billion in the week ending 30 January, "providing a robust merchandise imports cover of more than 11 months." Foreign currency reserves fell by $493 million but the value of gold reserves jumped by $14.59 billion as the price of gold soared on the spot market. ET. Since then the price of gold has crashed from  a high of $5,400.25 per ounce to $4,961.15 yesterday. Investing,com. India and the RBI have not forgotten the crisis of 1991 when our forex reserves fell to just $1.2 billion, barely enough to cover 3 weeks of essential imports. India had to airlift 47 tons of gold to the Bank of England and another 20 tons to the Union Bank of Switzerland to raise $600 million and avert the crisis. wikipedia. When asked, former RBI Governor Prof Raghuram Rajan "reportedly said there was no point at which a country could feel safe, unless it had accumulated trillions of dollars like China." We gain foreign exchange from exports, foreign direct investment (FDI), overseas loans and remittances by Indian expatriates. "The Indian diaspora sent home $135.46 billion in the last fiscal year, the highest on record." And the highest in the world. ET. The concern is that remittances are much higher than FDI. Between 2014-15, FDI, which is expected to be long term has been steady at around $30 billion annually, while foreign portfolio investment (FPI), which is short term, has been volatile. However, repatriation of FDI "jumped from $18 billion pre-pandemic to $44 billion and $51 billion in 2023-24 and 2024-25 respectively." And, outward investment by Indian entities doubled from $13 billion in 2019-20 to $28 billion in 2024-25. Mint. The RBI has played safe. Which is good because the world seems unpredictable. We could face the unexpected. Suddenly.   

Don to the rescue.

"A robust economy forms the foundation of a strong foreign policy and India must grow faster and increase its share of global trade to gain respect on the world stage, economist and NITI Aayog's former vice-chairman Rajiv Kumar has said." "India's share of global merchandise has remained below 2% for the last three decades," and "In the services sector, India's global share stands at around 4%." ET. On Friday, 03 February, "Shares of Infosys, Tata Consultancy Services, HCL Tech, Tech Mahindra and Wipro dropped sharply, falling by as much as 6% by 9.30 am," US artificial intelligence firm (AI) Anthropic released new tools "designed to handle routine legal work such as contract checks, non-disclosure agreement reviews, legal summaries and standard drafting tasks." NDTV. It has been coming. "In the 12 months leading up to August 2025, Accenture pulled in $4.78 billion in new business - a figure that surpasses the combined incremental revenue ($3.92 billion) generated by India's 15 largest IT services firms in 2024-25." 'Over half ($2.7 billion) of Accenture's new revenue came from advanced AI solutions," wrote Jas Bardia & Varun Sood." "According to Stanford's AI Index Report 2025, in 2024 the US led with 40 notable AI models, followed by China with 15. With these regions controlling nearly all LLMs that have achieved a global footprint, India faces a formidable challenge." "Bain & Co (2025) warned that India could face a shortfall of over a million skilled professionals by 2027." "R&D spending is also low, at 0.6% of GDP in 2024, versus 2.68% in China and roughly 3.5% in the USA." ET. As per the IMF, projected nominal GDP of the US was $30.62 trillion, China's was $19.4 trillion and India's was $4.13 trillion in 2025. Worldometer. It means that, in absolute numbers, the US spent $1.07 trillion while India spent an almost negligible $24,7 billion on R&D in 2024. "Recently, India's most valuable company paused its lithium-ion battery plant because it could not get Chinese technology." "The company could have funded a big research project. Instead it waited for technology from China." Why try to innovate when you can buy, wrote Arindam Goswami. Indians are afraid of failure. "Only the USA stands out as a country that has socially accepted the idea of failure as a legitimate option, worthy of praise." ET. "Patent filings by DPIIT recognized startups have crossed 13,000, since 2021, trademark filings have exceeded 44,000." Filing a patent "can help a founder make a pitch to investors." But, once the funding round closes, no actual patent is achieved, wrote Pravin Kaushal. Similarly, patent filings by educational institutions have risen from 20% to 42% of all filings. But the lack of revenue from licensing patents show that they are merely to improve their rankings, wrote Mihir Mahajan & Arindam Goswami. Artificial intelligence is created by human intelligence. Over one hundred years ago, American Robber Barons established universities and encouraged innovation. Edsurge. Protected by high tariffs our lot has been filing fake patents and begging from China. Perhaps the zero tariff on US goods forced on Mr Modi by Donald Trump (HT) may force them to start investing in R&D, to survive. We may yet hail the Don as our savior. Don of all people! Who would have thought that?        

An oily conundrum.

"In early September, after meeting Vladimir Putin and Xi Jinping, Prime Minister Narendra Modi "dispatched his National Security Adviser (NSA) to Washington to help over fraying ties." Mr Ajit Doval told US Secretary of State Marco Rubio, "India wanted to put the acrimony between the two nations behind it and get back to negotiating a trade deal," and that "New Delhi wanted Trump and his aides to dial down their public criticism of India." HT. Or else what? Give more money to China? As per Chinese Customs, India's exports to China increased by $5.5 billion to $19.75 billion in 2025, while imports from China jumped 12.8% to $135.87 billion, giving us a record trade deficit of $116.12. TOI. "Russia faces a steep drop in oil income if Trump successfully pressures India to stop importing Russian crude," which has already "dropped 22% to 1.38 million barrels per day in December from November, their lowest since January 2023, reducing Russia's share in Indian imports to 27.4% while OPEC's share rose to 53.2%." Reuters. Seems unlikely that Rubio was quaking with fear at threats from Mr Doval. Meanwhile, "China's trade with Russia in 2025 pulled back from a record level in 2024," to 1.63 trillion yuan ($234 billion). Since February 2022, China has been "buying Russian oil, coal and gas and selling goods from cars to electronics to its northern neighbor." Reuters. However, oil could yet have an enormous influence on what happens to our economy, as "aircraft carrier USS Abraham Lincoln and several guided missile destroyers have crossed into the Middle East, which comes under the US Central Command." "Trump had repeatedly threatened to intervene if Iran continued to kill protesters, but the countrywide demonstrations have since abated." Reuters. "For nearly half a century, Iran has prepared for a war with the United States." "Iran is believed to have thousands of missiles and drones within range of US troops based in a number of countries in the Middle East and has threatened to strike them, as well as Israel." CNN. Obviously, the US will need to be guided by Israel, as Israel has repeatedly revealed its intelligence network in Iran. In June 2025, "Israeli Air Force jets, guided by precise intelligence, targeted nuclear facilities, military commanders and soldiers, destroying dozens of radars and surface-to-air missile launchers, according to a statement by the country's War Room." NDTV. Israel could have been supplying intelligence already as, "The top US and Israeli generals held talks at the Pentagon on Friday (30 January) amid soaring tensions with Iran." Reuters. "Iran will hold nuclear negotiations with the US on Friday (tomorrow) in Oman, Iranian media reported." ET. Iran's threat against the US and Israel could be a bluff because it knows that any attack will invite severe reprisals. Instead, it could choose to target oil installations just across the Gulf in Saudi Arabia and the UAE which would send the price of oil shooting up like a missile. What would India do if that happens? Scaring Rubio won't work. Go back to Russia? Trump notwithstanding.   

The budget may need some help.

"Indian stock markets witnessed a historic surge on Tuesday, 3 February," so that, "The combined market capitalisation of BSE-listed companies increased to Rs 467.35 trillion from Rs 455 trillion in the previous session, translating into a gain of more than Rs 12.5 trillion in a single day." The reason for the euphoria was that "After prolonged negotiations, US President Donald Trump confirmed that reciprocal tariffs on Indian goods would be reduced to 18%, a steep cut from the earlier 50%." Mint. The rupee which had sunk to a record low of 92.043 against the US dollar on 28 January, joined in the celebrations, appreciating over 1% to close at 90.423 on 03 February. Investing.com. "After months of tariff threats...New Delhi has finally sealed a trade deal with the United States - not by yielding early but by waiting out the noise." "Even as talks dragged on, New Delhi quietly accelerated trade engagement elsewhere, signing five trade agreements over the past year - including a landmark pact with the European Union." ET. On the other hand, White House Deputy Press Secretary Kush Desai hailed the deal as "Another historic victory for American workers, farmers and industries." ET. US Trade Representative Jamieson Greer claimed that Indian tariffs on US industrial goods will fall from 13.5% to zero and also tariffs "for a variety of things...tree nuts, wine, spirits, fruits, vegetables, etc, they're going down to zero." ET. After two decades of negotiations, India and the European Union clinched a free trade deal last month. In it, "Tariffs on premium European wines will also be cut in stages, falling from 150% to as low as 20% over seven years, while lower priced wines are excluded." TT. In the trade deal between India and the United Kingdom customs duty on Scotch whiskey will come down from 150% to 75% and thereafter gradually to 40% over the next decade. ET. If India is to cut duties on US wines and spirits to zero in one fell swoop, both the EU and the UK may demand the same concessions and, since both agreements are yet to be ratified by their respective parliaments, they could be sent back for re-negotiations. "Replacing Russian crude with market-priced oil could see India's import bill rise by as much as $4 billion (Rs 362 billion at today's exchange rate of 90.50) (MC) but a report by State Bank of India (SBI) Research claimed that switching to Venezuelan heavy crude could cut our impost bill by $3 billion. "It noted that a discount of USD 10-12 per barrel on Venezuelan crude would be sufficient to make the choice economically neutral for Indian importers." ANI. Why should Venezuela give a discount when we have already agreed to Trump's demand? Some sectors like leather and textiles may see some benefits but the nation could incur a large deficit. That brings us to the Budget. But, that's another story. 

18% + $500 billion to go, for zero return.

Celebrating an abject surrender, "US President Donald Trump announced that he agreed to a trade deal with India's Prime Minister Narendra Modi, where the US will lower tariffs on goods from India to 18% from 25%." The 25% penalty for buying Russian oil will also be dropped. Instead India will buy more US oil and $500 billion worth of American goods and possibly also more Venezuelan oil. BBC. In 2024, a full year of trade before 26% reciprocal tariffs were imposed in April 2025 (Reuters), "US goods and services trade with India totaled an estimated $212.3 in 2024." The US exported goods worth $41.5 billion to India and imported $87.3 billion worth of goods from India, incurring a trade deficit of $45.8 billion. In services, the US exported $41.8 billion and imported $41.6 billion for a surplus of $102 million. ustr.gov. "Russia has sharply increased the discount on its Urals crude oil sold to India. In several cases, the discount compared to global oil prices exceeded $25 per barrel. For some individual cargoes, discounts approached $40 per barrel." man.com. "India imported about 144 billion euros' ($170.09 billion) worth of crude oil from Russia since the start of the Ukraine war, a European think tank said." NDTV. Now we have to buy US oil at market prices. Seems that our losses will be far more than any potential gains. In another standoff with the US, in January 2026, "After India challenged its authority to issue summonses, the US Securities and Exchange Commission (SEC) has moved a federal court to bypass diplomatic channels and allow service on Gautam and Sagar Adani via their US counsel and email." "The move marks a shift in the agency's 14-month effort," following, "On December 14, 2025, the SEC received letters from the Indian Ministry of Law and Justice, date November 4, citing a new and unexpected objection." This was the second time, the first rejection was in April 2025. The Wire. In addition, "The US SEC has arranged to serve Gautam Adani with a civil fraud lawsuit, allowing the regulator's case against India's second-richest person to proceed." CNBC. On 01 February 2026, "Billionaire Gautam Adani and his nephew, Sagar Adani, have agreed to receive a legal notice from US SEC in a civil fraud lawsuit alleging they misled investors about a bribery scheme, according to the court filing." TOI. The civil case is in addition to a criminal charge of bribery by federal prosecutors in Brooklyn. Mr Adani's lawyers have not accepted the jurisdiction of the Eastern District of New York. The trade deal will be hailed as a huge achievement, but a group of more than 800 small businesses in the US noted that effective tariffs on Indian imports were 2-3% but are at 18% now (Reuters) and could rise any time if any Russian oil is imported. Trump also announced that India has agreed to reduce tariff and non-tariff barriers on American goods potentially to zero. India Today. We give away everything and get some small change in return. They said stand and deliver and we did. Why? 

Halwa for them.

The deed is done. The Budget 2026 was presented to Parliament on Sunday, 1 February, for the ninth straight time by Finance Minister Nirmala Sitharaman, the longest serving finance minister of India. At I hour 25 minutes her speech was middle of the range, the shortest lasting 1 hour 14 minutes in 2025, the longest lasting a weary 2 hours 39 minutes in 2020. TOI. To prevent profiteering from advanced knowledge of any tax changes, utmost secrecy is observed. "Fifteen days prior to the presentation of the budget, security at the finance ministry is tightened dramatically." "The full budget statement is printed just 24 hours" before presentation and "The printing process is conducted under extreme secrecy, with staff involved in production kept in isolation and the entire operation secured by heavy surveillance." India Today. In a droll ritual a "Halwa (semolina pudding) is held annually at North Block to mark the final stage of preparation before the budget is presented in Parliament." News 18. The budget is not meant to be a triumph for the finance minister or officials, but is an anxious document for citizens who have to bear the burden of tax changes. The stock markets slumped, reflecting the verdict of investors. "The Nifty fifty fell 1.96% to 24,825.45, while the BSE Sensex lost 1.88%to 80,772.94, marking their worst budget-day performance in six years." Reuters. As is usual, news channels are full of platitudes. "For one brief, glorious period every year, Indian business folks" who "otherwise outsource everything from tax planning to PPTs - suddenly become macroeconomists, fiscal theorists, deficit hawks and growth evangelists," wrote industrialist Harsh Goenka. Before the Budget they "submit wishlists that would make a genie nervous." While just after, "Phones vibrate, heads nod and messages fly: 'Very positive.' 'Strong signal.' 'Game changer.' " "Behind closed doors, of course, nuance returns." "But, publicly, the verdict is unanimous: 10 on 10. Standing ovation." ET. "Led by Thomas Piketty, leftist economists protest inequalities are getting intolerable, so the richest should be taxed severely." But, ""instead of excoriating the super rich, the middle class would rather join them, wrote Swaminathan Aiyar. India does levy a surcharge at a maximum rate of 25% on income above Rs 20 million. cleartax.in. "Originally conceived as a 'temporary' measure to boost revenue, India's tax surcharges have become a permanent and heavy fixture of the fiscal landscape." "As incomes rise nominally due to inflation, more taxpayers are pushed into higher surcharge brackets without a corresponding increase in real purchasing power." ET. In July last year, the Finance Ministry told Parliament that "it expects to collect Rs 5.91 trillion from cess and surcharge in the current financial year, which is 9.43% higher than the previous financial year." ET. The silly rituals and the knee-jerk, obsequious praise by wealthy businessmen show the inequality of power between the rulers and the ruled in India. They share halwa with broad smiles. We groan through gritted teeth. And pay for the halwa.