India’s growth moderates
India’s early March data show a moderation in economic momentum, with the Finance Ministry explicitly linking a more uncertain outlook to West Asia disruptions that have hit energy and logistics channels. Officials and analysts still expect resilience — the OECD projects ~7.6% GDP growth through 2027–28 — but some federal grants and loans have been paused, leaving firms and institutions to seek contingency plans. (thehindu.com) (storyboard18.com) (iestpmache.edu.pe)
The Finance Ministry’s Department of Economic Affairs said March’s high‑frequency indicators showed early moderation: e‑way bill generation fell 5.3% month‑on‑month up to March 22 (still +9.4% year‑on‑year), and the report’s “flash PMI” readings pointed to softer output growth as West Asia disruptions hit energy and logistics channels. (dea.gov.in (dea.gov.in); thehindu.com (thehindu.com)) New Delhi has activated trade relief measures: the government approved the RELIEF (Resilience & Logistics Intervention for Export Facilitation) package on March 19, 2026 to reimburse extraordinary freight and insurance costs and prevent order cancellations, and an Inter‑Ministerial Group on Supply‑Chain Resilience was operationalised on March 2 to coordinate responses. (pib.gov.in (main.ecgc.in)) The OECD’s March interim Economic Outlook projects India’s GDP at 7.6% for FY2025–26, moderating to 6.1% in FY2026–27 and 6.4% in FY2027–28, while explicitly warning that the Middle East conflict could push up energy prices and test the resilience of the global economy. (oecd.org (oecd.org); business-standard.com (business-standard.com)) Industry groups say the disruptions are already material: the Confederation of Indian Industry reported shipment delays, higher freight and insurance premia, and shortages of key inputs, and urged firms to diversify sourcing and ramp up energy‑efficiency and renewable investments as part of a 12‑point resilience agenda. (economictimes.indiatimes.com (economictimes.indiatimes.com); deccanherald.com (deccanherald.com)) Separately, a U.S. Office of Management and Budget memorandum (Jan. 27, 2025) ordered a temporary pause on agency grants, loans and other federal financial assistance — a review covering programs that the memo said represent trillions of dollars of aid — and several agency‑level pauses (notably HHS/CDC notifications of grant holds) prompted short‑term freezes and legal/administrative clarifications. (nafsa.org (nafsa.org); wipfli.com (wipfli.com); statnews.com (statnews.com)) The Reserve Bank of India has kept market operations active amid the shock: RBI conducted variable‑rate repo (VRR) auctions in late March and published revised WMA limits and treasury auction calendars for April–September 2026 to smooth liquidity and financing conditions. (rbi.org.in (rbi.org.in))
