Current Affairs - Economy

Uttar Pradesh is formulating a new leather and footwear policy to enhance exports, provide financial aid, and introduce technological upgrades. The initiative aims to double the state’s ₹20,000 crore leather industry within five years, focusing on key hubs such as Kanpur, Agra, Unnao, and Noida. This policy aligns with the Union Budget 2025-26, which sets a target of $50 billion in Indian leather exports by 2030. By implementing this strategy, Uttar Pradesh seeks to strengthen its position as a major contributor to the country’s leather sector.

India has introduced new Harmonized System (HS) codes to facilitate the export of GI-recognized rice varieties such as Red Rice, Black Rice, and Kalanamak Rice. These codes help differentiate premium GI-tagged rice from general non-basmati rice, ensuring better market positioning and protection from export restrictions. The initiative aims to promote fair pricing, simplify trade processes, and strengthen India’s presence in global speciality rice markets. By assigning specific HS codes, India acknowledges the cultural and economic importance of these rice varieties while safeguarding farmers’ interests and boosting agricultural exports.

DPIIT (Department for Promotion of Industry and Internal Trade) of India signed a Memorandum of Understanding (MoU) with the Korea Transport Institute (KoTI) to enhance logistics and infrastructure cooperation. This partnership focuses on the PM GatiShakti National Master Plan, aiming to improve logistics efficiency through knowledge exchange, research-driven initiatives, and technology adoption. Strengthening bilateral ties with global institutions like KoTI helps India advance its logistics sector and adopt best practices from leading economies.

India is set to launch the EFTA Desk in New Delhi to enhance economic relations with the European Free Trade Association (EFTA). This initiative aligns with the India-EFTA Trade and Economic Partnership Agreement and aims to boost trade, investment, and business collaboration between India and EFTA member nations. The EFTA consists of Iceland, Liechtenstein, Norway, and Switzerland. By establishing this desk, India seeks to facilitate smoother economic interactions and expand its engagement with these European economies, fostering stronger trade partnerships and investment opportunities.

The Reserve Bank of India (RBI) reduced the repo rate by 25 basis points (bps), bringing it down to 6.25%. This marks the first rate cut in 57 months, reflecting a shift in the RBI’s policy stance after a series of rate hikes since 2022. The move is aimed at supporting economic growth while keeping inflation in check. A lower repo rate typically results in reduced borrowing costs for businesses and consumers, stimulating demand in key sectors such as housing and automobiles. Despite the cut, the RBI remains cautious due to global uncertainties and inflation risks.