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RBI trims growth forecast amid global trade uncertainties, keeps repo rate unchanged

The RBI has kept the policy repo rate unchanged at 5.5%, while revising the growth forecast to 6.5% in light of emerging global trade disruptions and the recent US tariff hike on Indian imports.

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Reserve Bank of India

Amid rising global economic uncertainty and the imposition of new tariffs by the United States, the Reserve Bank of India (RBI) on Wednesday maintained its key policy rate at 5.5%, while slightly trimming its growth forecast for the current financial year from 6.7% to 6.5%. The central bank also reduced its inflation forecast from 3.7% to 3.1%, citing easing price pressures.

The RBI’s Monetary Policy Committee, led by Governor Sanjay Malhotra, voted unanimously to hold the repo rate steady, adopting a ‘neutral’ policy stance as it evaluated risks arising from volatile global trade dynamics and shifting geopolitical scenarios.

The decision comes in the backdrop of a 25% import duty imposed by the US on Indian goods, starting Thursday. While Governor Malhotra refrained from making direct comments on the tariff hike, he acknowledged that the uncertainty around external demand and ongoing trade negotiations poses a risk to India’s growth trajectory.

“Prospects of external demand remain uncertain amidst ongoing tariff announcements and trade negotiations. The headwinds emanating from prolonged geopolitical tensions, persisting global uncertainties, and volatility in global financial markets pose risks to the growth outlook,” said Malhotra during the press briefing.

Growth revised, but fundamentals strong

Despite trimming the GDP growth forecast by 0.2%, Malhotra stressed that the Indian economy continues to show resilience. He said that robust domestic fundamentals and economic buffers have helped shield the country from global shocks.

“Growth is robust and as per earlier projections, though below our aspirations. The uncertainties of tariffs are still evolving. Monetary policy transmission is continuing,” he added.

According to the Governor, while India’s economic trajectory is challenged by external pressures, opportunities exist in the changing global order, and policy frameworks across sectors—not just monetary policy—must remain strong and agile.

Inflation outlook improves

The RBI now expects inflation to moderate further, revising its estimate to 3.1% for the current fiscal year. However, Malhotra cautioned that headline inflation could witness a rise towards the end of the year, signaling the need for ongoing monitoring.

Clear policy direction ahead

Reiterating the RBI’s focus on price stability and sustainable growth, Malhotra noted that the central bank will remain data-driven in its future policy decisions.

“We, on our part, will continue to be agile and proactive in providing a facilitative monetary policy based on incoming data and the evolution of the growth-inflation dynamics,” he said, affirming the bank’s commitment to transparent and credible communication.

India News

Vijay meets Tamil Nadu Governor again as TVK pushes to prove majority

TVK chief Vijay held another meeting with Tamil Nadu Governor Rajendra Vishwanath Arlekar as the party intensified efforts to secure majority support after emerging as the single-largest party in the Assembly elections.

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Actor vijay

Actor-turned-politician Vijay met Tamil Nadu Governor Rajendra Vishwanath Arlekar again on Thursday as his party, Tamilaga Vettri Kazhagam (TVK), continued efforts to prove it has enough support to form the next government in the state.

TVK emerged as the single-largest party in the 234-member Tamil Nadu Assembly after winning 108 seats, but it remains short of the majority mark of 118.

The Congress has extended support to TVK, adding five MLAs to Vijay’s side. However, the alliance still needs additional backing from other parties or independents to comfortably cross the halfway mark.

According to reports, the Governor has not yet been fully convinced that TVK currently has the required numbers to form a stable government. This has delayed clarity over the swearing-in ceremony and the formal invitation to form the government.

Political activity intensified after reports emerged that some AIADMK legislators were moved to a resort in Puducherry amid speculation over possible support to TVK. AIADMK leaders, however, publicly denied any internal crisis.

TVK sources have expressed confidence that the party will be able to demonstrate majority support during discussions with the Governor.

The Tamil Nadu election results marked a major political shift in the state, with TVK breaking the long-standing dominance of the DMK and AIADMK in its first Assembly election contest.

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PM Modi changes social media profile pictures to mark Operation Sindoor anniversary

PM Modi changed his social media profile pictures to commemorate one year of Operation Sindoor, with several NDA leaders following the move.

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PM Modi speech

Prime Minister Narendra Modi on Thursday updated the display pictures of his social media accounts to mark the first anniversary of Operation Sindoor. The new image was seen across his profiles on X, Facebook, Instagram and WhatsApp channels.

The updated profile picture carries the text “Operation Sindoor” on a black background along with elements of the Indian tricolour. One of the letters in the word “Sindoor” has been stylised using vermilion, commonly associated with married Hindu women.

Operation Sindoor was launched a year ago by Indian defence forces and the Border Security Force along the western border. The anniversary was also marked by several Union ministers and NDA leaders, who changed their social media profile pictures in a similar manner.

External Affairs Minister S. Jaishankar and other senior leaders were among those who adopted the commemorative display image on social media platforms, according to reports.

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Congress, BJP attack Bhagwant Mann over remarks on Punjab blasts

Congress and BJP have jointly criticised Punjab CM Bhagwant Mann after he linked recent blasts near defence sites to political motives, triggering a controversy.

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Bhagwant Mann

A political row has erupted in Punjab after Chief Minister Bhagwant Mann linked recent blast incidents to political motives, drawing sharp criticism from both the Congress and the Bharatiya Janata Party (BJP).

The controversy follows two low-intensity explosions reported within a short span of time — one near the Border Security Force (BSF) headquarters in Jalandhar and another close to an army cantonment area in Amritsar. The incidents raised concerns over security, particularly given the sensitive nature of the locations.

In response, Mann suggested that the blasts could be part of a larger political strategy. His remarks triggered a strong backlash, with opposition parties accusing him of politicising a serious security issue.

Leaders from the Congress criticised the Chief Minister’s statement, calling it inappropriate and alleging that such comments undermine the gravity of the situation. They stressed that matters related to national security should be handled with caution and responsibility.

The BJP also joined the criticism, questioning the basis of Mann’s claims and urging the state government to focus on investigation and law enforcement instead of making political allegations.

The developments have led to an unusual moment where both Congress and BJP appear aligned in their criticism of the Aam Aadmi Party-led government in the state.

Meanwhile, the blasts themselves have intensified concerns over safety in border regions, with authorities continuing their investigation into the incidents. No casualties were reported, but the proximity to defence establishments has made the issue particularly sensitive.

The episode has further escalated political tensions in the state, with security and accountability emerging as key points of debate.

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