COMPANIES | PAGE 4 INTERNATIONAL | PAGE 7 USAID to be shut down to cut costs, says Musk BACK PAGE | PAGE 20 TVS, Royal Enfield lead January 2Wsales race AHMEDABAD, TUESDAY, FEBRUARY 4, 2025 Vocalist-entrepreneur Tandon bags Grammy FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL NO. XIX 207, 24 PAGES, `12 P U B L I S H E D F R O M : A H M E D A B A D , B E N G A L U R U , C H A N D I G A R H , C H E N N A I , H Y D E R A B A D , K O C H I , K O L K ATA , L U C K N O W, M U M B A I , N E W D E L H I , P U N E SENSEX: 77,186.74 ▼ 319.22 NIFTY: 23,361.05 ▼ 121.10 NIKKEI 225: 38,520.09 ▼ 1052.40 HANG SENG: 20,217.26 ▼ 7.85 `/$: 87.20 ▼ 0.58 `/€: 89.19 ▲ 0.77 BRENT: $77.02 ▲ $1.35 GOLD: `82,313 ▲ `515 INDIA'S PACE OF debt reduction is gradual, leaving room for downside risk to sovereign rating in the eventuality of a significant economic shock, Fitch Ratings said. ■ PAGE 3 »EXPLAINER« CAN INDIA DODGE THE TRUMP TARIFF BULLET? PAGE 9 Continued on Page 11 87.04 (Open) 87.20 (Close) (inverted scale) Intra-day How Asian currencies performed 0.67% SENSEX Intra-day 77,063.94 Open 0.41% 77,186.74 Close Previous close:77,505.96 ANUPREKSHA JAIN & KISHOR KADAM Mumbai, February 3 THERUPEEPLUNGEDtoanew record low and the benchmark indices ended in the red on Monday as US president Donald Trump’s aggressive tariff policies against Canada and China and the latest threat against Europe triggered fears of a global tradewar. Thai baht % change on Feb 3* Indonesian rupiah THE STAGE IS set for tariff war 2.0. European leaders were bracing for US tariffs after President Donald Trump said tariffs on EU goods imported into the US could happen “pretty soon”. This comes after Trump slapped 25% levies on goods from Mexico (a move that was paused for a month on Monday after an agreement on security and trade) and Canada, along with an additional 10% tax on imports from China — moves that will affect billions of dollars worth of trade, roiling global markets and currencies. “They (EU) don’t take our cars, they don’t take our farm products, they take almost nothing and we take everything from them. Millions of cars, tremendous amounts of food and farm products,” Trump told journalists. MONDAY BLUES -0.88 -1.05 India’s pace of debt reduction gradual: Fitch DAPHNE PSALEDAKIS, DAVID LAWDER & BART H MEIJER Washington/Brussels, February 3 PRASANTA SAHU New Delhi, February 3 Rupee breaches 87, benchmarksvolatile Taiwanese dollar AS THE WORLD is drawn into a trade war, India and the UK will sit down and resume negotiations on a free trade agreement on February 24. A team of negotiators from the UK will be in New Delhi to start the 15th round of talks. ■ PAGE 2 threat rattles global markets Indian rupee FTA talks with UK to resume on February 24 ● Trump’s latest South Korean won THE CENTRE HAS more than halved the outlay for the state-run BSNL to `33,575.58 crore for FY26, from `72,027.65 crore in FY25, suggesting it wants the telco to start generating better cash flows, reports Urvi Malvania. ■ PAGE 4 Tax sops to add `45,000 crore to bank deposits in FY26: DFS secy Tariffwar 2.0: US says Europe next -0.67 -0.71 -0.82 Govt halves BSNL outlay ahead of its 4G launch PREPAREDTOFIGHTBACK,SAYEULEADERS -0.49 Philippine peso -0.59 Singapore dollar IN THE NEWS 0.47 Japanese yen *over previous close The rupee breached the 87/$ mark for the first time.It slumped 58 paise, ending at 87.195/$ against the previous close of 86.616/$, marking its biggest single-day loss since January 13. During the day, the rupee fell to a low of 87.2950. Continued on Page 5 ■ Not worried about rupee volatility: Fin secy, Page 2 THE BUDGET PROPOSALS such as income tax relief and an increase in tax deduction at source (TDS) threshold on fixed deposits may lead to an additional deposit mobilisation of around `45,000 crore by the banks in 2025-26, boosting their liquidity for enhancing credit flows,financial services secretary M Nagaraju said on Monday. In the Budget for 2025-26, the government has proposed an increase in the TDS threshold on interest earned from fixed deposits for non-senior citizens from the current `40,000to`50,000perfinan- M NAGARAJU SECRETARY, DEPARTMENT OF FINANCIAL SERVICES cialyear.TheTDS threshold for FD interest income earned by senior citizens will be doubled from `50,000 to `1 lakh. The income tax exemption limit has been increased to `12 lakh from `7 lakh in the new tax regime,whichthegovernment said would leave around `1 Additional deposits will increase the banking system’s liquidity, reducing dependence on high-cost borrowing lakh crore cash in the hands of taxpayers in a year. Giving an analysis of the impact of the tax proposals on bank deposits, Nagaraju said around `20,000 crore could return to banks due to the increase in the tax exemption limit,at least `15,000 crore in AltmanvisitsIndiatomorrow, tomeetPMandVaishnaw FE BUREAU New Delhi, February 3 OPENAI'S CHIEF Sam Altman willvisitIndiaonWednesday,in what will be his first visit in two years at a time when the company faces legal challenges in the country. Among others, Altman is expected to meet Prime Minister Narendra Modi and minister of electronics and ITAshwini Vaishnaw. The visit, which is VISITING AGAIN ■ OpenAI has faced legal challenges in India; India also its secondlargest market by number of users after the US ■ The visit, part ofAltman’s Continued on Page 11 Proxyfirms opposeSaluja reappointment firm’s AI Assistant has overtaken ChatGPT to become the top-rated free app on Apple’s app store in the US. A DAY BEFORE the case of reappointment of Religare Enterprises (REL) chairperson Rashmi Saluja as director on the board is heard in the Delhi High Court, three proxy advisory firms — InGovern, IiAS and SES — have flagged several factors,includingherexcessive remuneration, disproportionate grant of employee stock options (ESOPs) and ongoing legal challenges, reports Ananya Grover. Continued on Page 11 Report on Page 6 ongoing Asia tour, comes days after emergence of Chinese AI rival DeepSeek ■ Altman last visited India in 2023 when he met Modi and discussed the potential ofAI in boosting India's tech ecosystem partofAltman’songoing tour of Asia,comes a fewdays afterthe emergence of Chinese AI rival DeepSeek. The Chinese fresh deposits from senior citizens due to the doubling of TDS threshold and `7,000 crorefromnon-seniorcitizens. “These measures, as per an assessment,suggestthatabout `40,000-45,000 crore will flow into banks as deposits. Additional deposits will increase the banking system’s liquidity, reducing dependence on high-cost borrowing,”Nagaraju said. Senior citizens hold about `34 lakh crore in bank deposits, and since TDS directly influences deposit behaviour, this measure is expected to push deposits further,Nagaraju said. Ahmedabad