Deals In The Air, Smoke On The Ground

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Good Morning. Indian markets soared on the hopes of a US-India trade breakthrough, but Prime Minister Narendra Modi skipped a meeting with US president Donald Trump in Kuala Lumpur, sending out clear diplomatic signals. Back home, in the national capital, not-so-green fireworks had AQI levels soaring.

The BSE Sensex hit a fresh 52-week high of 85,290, and finally closed at 84,556.4, gaining only 130 points or 0.15%. The NSE Nifty hit an intra-day high of 26,104, but closed at 25,891.4, gaining only 23 points or 0.09%.

In other news, India’s digital payments hit a milestone. Meanwhile, Tata Technologies is changing its hiring strategies because of H-1B visa fees.

Modi Avoids Trump, While Delhi Chokes On Diwali: The Week That Was

In the expectation of a trade deal being struck with the US, stock market indices have soared, even as Prime Minister Narendra Modi avoided a face-to-face meeting with US president Donald Trump by deciding to skip physical presence at the Kuala Lumpur summit of the Association of South-East Asian Nations (ASEAN) scheduled for October 26-28.

News reports put the post-trade-deal US tariffs on India at 15-16%, more or less in line with the duties that India’s competitors for a share of the US import market face.

Another favourable development in India-US relations has been the US government’s decision to lift the $100,000 fee for H-1B visas in the case of those already in the US on other visas, say the F1 student visa or the L1 intra-company transfer visas used by multinational companies to bring to the US their own employees deployed in a non-US country. 

This change of heart on the part of the Trump administration comes in the wake of the US Chamber of Commerce suing the government over the restriction of access to foreign talent that American businesses need, via the visa fee hike. 

Trump Waives, Modi Waits

Prime Minister Modi’s reluctance to meet with Trump at Kuala Lumpur does not necessarily mean that the trade deal talk is just trumpery: it could simply signal his displeasure at Trump’s utter disdain for Modi’s discomfiture over Trump’s repeated claim that New Delhi has accepted to sharply lower oil imports from Russia, even as Russian president Vladimir Putin tweets that India will refuse to be humiliated, and the Indian government continues to be non-committal on buying oil from Russia.

It is not just Modi who is skipping a meeting with Trump. Trump had announced a meeting with Vladimir Putin in Budapest to discuss Ukraine, only to have the Russian external affairs minister scotch that proposal. 

Diwali Chokes Delhi

The run-up to Diwali saw retail sales pick up after a prolonged anaemic phase. The Supreme Court, in its wisdom, chose to allow a plea to lift the ban on crackers and other fireworks in the national capital region, and permitted the use of so-called green crackers for brief periods on two days.

The well-heeled have taken this as the green signal for crackers in general, and filled the Delhi sky with noxious fumes to such an extent that most air quality monitors fail to measure the full extent of the pollution unleashed. 

The only saving grace has been that there has been a mild breeze, unlike around previous Diwalis, to blow the pollution over an extended area beyond Delhi and its neighbourhood.

Air purifiers have taken the place of battery-inverter combos and power generators as the vulture industry that feasts on governance failure. The rich, who can afford them, pollute the sky with their fancy fireworks, and leave the poor to breathe in the unfiltered poison and suffer cognitive decline, enhanced cancer risk, pulmonary disease and pre-term births.

Meanwhile, in China, a new five-year plan has been approved. Artificial intelligence, quantum computing, domestic design and the manufacture of advanced semiconductors are top of the agenda. 

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CORE NUMBER

99.8%

That’s the share of digital payments in India’s total payment transactions by volume in the first half of 2025 — a record high, according to the Reserve Bank of India (RBI). By value, too, digital modes made up 97.7% of all payments, amounting to Rs 1,536 lakh crore out of Rs 1,572 lakh crore.

Why It Matters: India’s digital payments revolution is nearly complete. In 2019, digital payments were 96.7% of total volume — now they have become virtually universal.

Driving The Shift: Unified Payments Interface (UPI) dominates with 85% of transactions by volume, processing over 10,637 crore payments worth Rs 143.3 lakh crore in H1 2025. Real-Time Gross Settlement (RTGS) leads by value (69%), handling Rs 1,079.2 lakh crore, as it caters to large-value payments above Rs 2 lakh.

What’s Next: With almost every rupee now moving digitally, RBI data signals that India’s long push toward a cash-light economy has effectively arrived — though the focus now shifts to improving security, reliability, and cross-border payment linkages.

FROM THE PERIPHERY

India To Cut Russian Oil?

New reports suggest that Indian refiners may be preparing to drastically cut Russian oil imports after new US sanctions on Rosneft and Lukoil, the country’s top producers, Reuters reported. The move comes as India faces 50% tariffs on its exports to the US, half of which are penalties for buying Russian oil, sources told Reuters.

Flashpoint: Reliance Industries, India’s biggest buyer of Russian crude, reportedly plans to halt purchases under its long-term Rosneft deal and shift to Middle Eastern and Brazilian supplies. State refiners like IOC, BPCL, and HPCL are also reviewing contracts to ensure compliance, the reports said.

What's Next? The US has given firms until November 21 to end transactions. India, which imported 1.7 million barrels a day from Russia this year, is expected to trim those sharply as refiners align with government guidance and seek to preserve access to Western markets and financing.

Censor, Interrupted.

India has restricted content-takedown powers to senior bureaucrats and high-ranking police officials, reversing a 2021 order that let junior officials demand removals. The change follows a long legal battle with Elon Musk’s X (formerly Twitter), which challenged government orders to block hundreds of posts and accounts under the Information Technology Act. 

How We Got Here: X argued that many requests related to farmers’ protests, journalists, and opposition figures were excessive and lacked due process. The Karnataka High Court upheld most of those orders in June 2024, but the case intensified scrutiny of India’s online censorship framework. 

The Shift: The new guidelines now require written justification and monthly reviews by top officials.

Local Hires, Global Pressure!

Tata Technologies will hire more US-based workers as Washington tightens immigration rules under President Donald Trump. The Indian engineering services firm said steep H-1B fees have made it harder to bring engineers from India to the US, prompting a shift toward local hiring.

Backdrop: India accounts for nearly three-quarters of all H-1B recipients, and companies like Tata file thousands of applications each year. 

Critical Moment: Tata Technologies said it already employs mostly local staff in markets such as China, Sweden, and the UK. CEO Warren Harris said the company remains optimistic about US growth over the next six to nine months despite tariff pressures and higher operating costs.

Leather Exports Hit.

India’s leather and allied products industry is set to see a 10–12% revenue decline this fiscal as the US imposes a steep 50% tariff — including a 25% penalty for buying Russian oil—cutting export volumes sharply, according to Crisil Ratings latest report.

By the Numbers: Exports, which make up 70% of the industry’s Rs 56,000 crore revenue, are projected to drop 14–16% to $3.9–4 billion, with many tanneries shutting operations. Operating profitability may fall 150–200 bps, hit by weak fixed-cost absorption and reduced orders from the US, which accounts for 22% of exports.

Fast Facts: While diversification efforts and the UK Free Trade Agreement may offer some relief, these will take time to show results. Domestically, lower GST (12%), softer inflation, and reduced rates could aid demand, but not enough to offset the export slump, keeping credit profiles under pressure.

THE CORE QUIZ

PODCASTS

Markets Rise For The 6th Day

On Episode 709 of The Core Report, financial journalist Govindraj Ethiraj talks to Shalini Pillay, India Leader for the Global Capability Centres segment at KPMG in India.

• Markets rise for the 6th day as optimism takes over.

• US sanctions on Russian oil majors will affect India.

• India’s vast talent pool is a magnet for more GCC business verticials, latest being energy.

• Tesla posts losses again though its CEO wants a $1 trillion salary.

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