EXPLAINER | PAGE 9 BRANDWAGON | PAGE 9 Why FMCG firms are jittery about demand INTERNATIONAL | PAGE 7 Hyperlocal firms eyeing space vacated by Genie AHMEDABAD, FRIDAY, MAY 16, 2025 Powell's job market tilt under watch as Fed revisits strategy FOLLOW US ON TWITTER & FACEBOOK. APP AVAILABLE ON APP STORE & PLAYSTORE WWW.FINANCIALEXPRESS.COM READ TO LEAD VOL NO. XIX 293, 32 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: 82,530.74 ▲ 1,200.18 NIFTY: 25,062.10 ▲ 395.20 NIKKEI 225: 37,755.51 ▼ 372.62 HANG SENG: 23,453.16 ▼ 187.49 `/$: 85.55 ▼ 0.27 `/€: 95.84 ▲ 0.12 BRENT: $64.61 ▼ $1.48 GOLD: `92,020 ▼ `1,387 INDIA’S UNEMPLOYMENT RATE stood at 5.1% for persons aged 15 years and above, with the rate for males at 5.2% and for females at 5.0%, the first monthly bulletin of Periodic Labour Force Survey released on Thursday showed. In urban areas, the unemployment rate stood at 6.5%. ■ PAGE 3 Modi to meet CMs on Viksit Bharat, rural development PRIME MINISTER NARENDRA Modi will discuss with chief ministers the steps needed to boost rural economic development at the Niti Aayog governing council meeting on May 24, as the country works towards achieving the goal of Viksit Bharat by 2047, reports Prasanta Sahu. ■ PAGE 2 RIL secures $2.9-bn offshore loan, India's biggest since 2023 RELIANCE INDUSTRIES (RIL) has secured a dual-currency loan worth $2.9 billion, the largest offshore loan raised by an Indian company since 2023, reports fe Bureau. The loan agreement was signed last week and will see the participation of 55 banks. ■ PAGE 4 VODAFONE IDEA HAS filed a writ petition in the Supreme Court seeking waiver of nearly `45,457 crore in adjusted gross revenue (AGR) dues, reports Urvi Malvania. ■ PAGE 4 Mutual funds pitch for bigger play in F&O market ASSET MANAGEMENT COMPANIES want to participate more aggressively in the futures and options (F&O) segment, as they believe they are in a better position to counter high-frequency traders mostly dominated by foreign institutional investors, reports Joydeep Ghosh. ■ PAGE 6 Govt invites fresh applications for pharma PLI scheme TO BOOSTTHE production of bulk drugs, the Centre has invited fresh applications from firms under the production-linked incentive (PLI) scheme, reports Manu Kaushik. ■ PAGE 2 FE BUREAU New Delhi, May 15 FE BUREAU New Delhi, May 15 IN A BLUNT message to Apple CEO Tim Cook, US President Donald Trump has asked the tech titan to halt plans of ramping up iPhone production in India for American consumers, and urged the company to increase its domestic manufacturing footprint instead. Trump’s remarks,made during his state visit to Qatar, could throw a spanner in Apple’s strategy to shift manufacturing away from China amid rising tariff pressures. “I told Tim, we are treating you verywell,butIdon’twantyoubuilding in India unless it’s to supply (to) the Indian market,”Trump said.He added that Apple would be“upping their production in the United States”following the conversation. Trump’s comments come at a time when Apple is significantly expanding its India operations.The company currently assembles nearly20%ofitsglobaliPhoneoutput — about 40-to-45 million units annually — in India. Of these, around 15 million units are exported to the US,andApple plans to increase the volume. THE CENTRALBOARD of directors of the Reserve Bank of India met on Thursday in Mumbai to review its economic capital framework (ECF), amovethatcouldleadtorecordsurplus transfer to the Centre. In the FY26 Budget,the government has estimated the RBI’s surplus transfer in excess of the FY25 figure of `2.1 lakh crore,an all-time high. The robust dividend in FY25 (RBI accounting year FY24) was against the Budget estimate of `80,000-90,000 crore,giving extra fiscal space to the Centre. This enabled the government to spend more as well as to bring down the fiscal deficit to 4.8% of the GDP from the Budget estimate of 4.9%. “The RBI is expected to pay a record dividend of as much as `3.5 lakh crore ($41 billion) to the government this year, helping to offset a tax revenue shortfall,” Bloomberg reported. The provisions required under the RBI’s contingent risk buffer (CRB)wereraisedto6.5%,theupper band of 5.5-6.5% requirement, for FY24 from 6% in the previous fiscal,inlinewiththeBimalJalancommittee recommendations. During accountingyears 201819 to 2021-22, owing to the prevailing macroeconomic conditions and the onslaught of Covid-19 pandemic, the board had decided to maintain the CRB at 5.5% of the RBI’s balance sheet size to support growth and overall economic activity. With the revival in economic growth in FY23, the CRB was increased to 6%. As the economy remained robust, the board had decided to increase the CRB to 6.5% for 2023-24. Now, since the economy is likely to take a hit due to global trade tensions, the RBI board may lower the CRB requirement to free up more cash for transfer to the government to boost spending, as tax revenues may come under pressure.Various agencies including IMF and the World Bank have estimated 20 bps to 50 bps negative impact on India's economic growth owing to global uncertainties and heightened trade tension. Trump toApple CEO: Don’t make in India Continued on Page 2 Reliance Industries chairman Mukesh Ambani meets US President Donald Trump in Doha, Qatar. Trump is on a four-day official visit to West Asia PTI Apple’s India plans‘intact’ APPLE EXECUTIVES HAVE told Indian officials that the company’s investment plans in the countryareintactanditproposes to have a major manufacturing base for its products here, government sources said on Thursday,following US President DonaldTrump’sremarksonreducing iPhone manufacturing in India. According to the sources, Indian officialsspoketoAppleexecutives soon after Trump said in Doha that he had requestedApple CEO TimCooktocutiPhonemanufacturing in India forAmerican consumers and focus on domestic production. —FE BUREAU ‘Premature’:Jaishankarrebuts USclaimof‘zero-tariff’offer FE BUREAU New Delhi, May 15 HOURS AFTER US PRESIDENT Donald Trump said in Doha that India is “willing to literally charge us no tariffs” under a bilateral agreement being negotiated, New Delhivirtuallydebunked the claim on Thursday. “Between India and the US,trade talks have been going on. These are complicated negotiations. Nothing is decided till everything is,” external affairs minister S Jaishankar said. Without explicitly referring to Trump’s statement, the minister also made it clear that India was looking for a trade deal that is Until that is done, any judgement on it would be premature,” he asserted. The US president’s claim ofzero-tariffofferbyIndiacomesat a time commerce and industry minister Piyush Goyal is scheduled to visit the US this week to further talks on the bilateral trade agreement (BTA) and even explore the possibility of an interim deal. Duringtheminister’sstay in the US, a team of Indian officials will also be in Washington and the chief negotiators of India and the USwill hold parallel talks. S JAISHANKAR, EXTERNAL AFFAIRS MINISTER Between India and the US, trade talks have been going on. These are complicated negotiations. Nothing is decided till everything is. “mutually beneficial.”“(The trade deal) has to work for both countries. That would be ourexpectation. Continued on Page 2 ● Investors richer by PVsales up 4% inApril, 2-wheelers down 17% PASSENGERVEHICLE SALES to dealers rose 3.9% inApril, reaching 348,847 units, driven by a 12.1% surge in utility vehicle demand, reports fe Bureau. In contrast, twowheeler sales plunged 16.7% due to a high base inApril 2024. Within PVs, however, car sales dropped 5.4%. Motorcycle and scooter sales declined, with Hero MotoCorp and BajajAuto seeing steep drops. Meanwhile, three-wheelers dipped 0.7%. Domestic sales (units) Apr 2024 Apr 2025 Chg (%) Threewheelers Two-wheelers 49,774 1,751,393 16.7 1,458,784 49,441 Passenger vehicles 0.7 335,629 3.9 Overall* 348,847 2,088,932 Source: Siam *overall sales exclude Tata Motors' numbers 13.3 1,811,876 In three years since launch, banks add just 25 kiosks to initial 75 as customers prefer banking correspondents Digital banking units fail to touch a chord MAHESH NAYAK Mumbai, May 15 47 6 Others (20 banks) 7 Canara Bank 8 Union Bank of India 12 Punjab National Bank 20 State Bank of India Top 5 banks account for over 50% of DBUs Bank of Baroda THE DIGITALBANKING unit (DBU) initiative — banks’ attempt to connect with the unbanked and the underbanked population using their digital prowess — largely remains on paper three years since its launch, with banks adding just 25 units to the initial 75. SeveralbankofficialsFEspoketo remainedscepticalaboutthefuture of the initiative, and one of them summed up the situationwell: “It’s just a box-ticking exercise.” For a population of 1.4 billion, 100 DBUs seem like a drop in the ocean,bank officials said. They said the DBU initiative has been overshadowed by the growing FEW TAKERS Source: Bank website presenceofbusinesscorrespondents (BCs) who provide banking services like account opening, loans, and investment products on the doorstep.With around 1.35 million BCsandcounting,customershavelittle incentive to visit DBUs.“BCs have madeDBUsredundant,”saidanother banker. “When banking is on your doorstep,whyvisitabankingkiosk?” Bankofficialssaidtheconceptof DBU looked good on paper, but it failed to translate into reality.“Customer acceptance is crucial for DBUs’ success, but it’s just not hap- Nifty reclaims 25,000 peak after 7 months pening,”said a banker,citing lack of awarenessaboutDBUs,lowfinancial literacy in rural and semi-urban India,andhigheroperationalexpenditure as reasons behind the dismal uptake. Mobile and digital banking proliferation has further reduced the need for DBUs. Customers are now spoilt for choice, and DBUs seem like an afterthought. Though regulators have prioritised digital banking, DBUs are not in the top of thelist.“Financialinclusionrequires a tailored approach,” said a source. “We’veaddedoverhalfabillionbank accounts via the Jan Dhan scheme, butthere’sstillworktobedone.”The focus is on deepening financial inclusion through other channels. Continued on Page 11 `5.22 lakh crore KISHOR KADAM Mumbai, May 15 AFTERALISTLESS firsthalf,benchmarkindicesrosesharplyinthesecond half of Thursday, riding on hopes — fuelled by US President DonaldTrump’s remarks that India and the US have reached a potential trade agreement. The Sensex soared 1,200.18 points(1.48%)tocloseat82,530.74, whiletheNiftysurged395.20points (1.60%),reclaimingthe25,000peak after a gap of seven months, and closedat25,062.10.Thesharprecoverywas fuelled by aggressive buying across key sectors such as metals, automobiles, information technology, and real estate.“While benchmarkindicesgyratedsharplyinearly trades, they quickly regained lost momentum and rallied sharply thereafter on the back of all-around buyingsupport,despitepessimismin European and other Asian bourses. The Nifty closing above the 25,000markwillbeahugeboostfortraders,” said Prashanth Tapse, senior vice president (research),Mehta Equities. Continued on Page 11 TURNING BULLISH NIFTY Intra-day, May 15 25,062.10 Close 24,694.45 395.20 Open points 1.60% 24,666.90 Previous Close TOP SECTORAL GAINERS 1.87 1.86 1.85 SENSEX Intra-day, May 15 81,330.56 Previous Close 81,354.43 Open 1.62 1.60 82,530.74 Open Realty Services Metal 1.48 % Auto Industrials « Vodafone moves SC seeking `45,457-cr waiver on AGR dues RBI meet raises hopes ofrecord dividend Exportsswell9.1%on rushtobeatUS tariff ● April trade deficit at five-month high MUKESH JAGOTA New Delhi, May 15 INDIA’S MERCHANDISE EXPORTS grew at a six-monthhigh rate of 9.1% to $38.49 billion in April, thanks to a jump in shipments to the US, as exporters rushed their orders to beat the reciprocal tariffs announced by the Donald Trump administration. Goods exports to the US rose 27.38% to $8.42 billion in the month, helping revive the overall shipments from a modest 0.65% growth in March, and contraction witnessed in the previous four months. The reciprocal tariffs that were announced on April 2 have since been suspended till July 8. CommercesecretarySunilBarthwal indicated that some of the increase inexportstotheUScouldalsobedue to the advantage from“tariff differential”with competitors. Imports of goods in April grew at an even higher rate of 19.12% to $64.91 billion as inflows of crude and industrial inputs like machinery and minerals gathered pace.This indicates rising domestic output and investment demand in the economy. The month saw a trade deficit BALANCE OF TRADE Trade in goods, % chg, y-o-y Exports Imports 25 22.6 19 19.1 20 15 9.1 10 5 0 -5 -10 -9.9 .9 -15 Sep 2024 Oct 2024 Nov 2024 Dec 2024 Jan 2025 Feb 2025 Mar 2025 Apr 2025 April unemployment rate at 5.1%, shows first monthly bulletin USPRESIDENTASKSCOOKTOINCREASEPRODUCTIONINUS Aug 2024 IN THE NEWS of $26.42 billion, which was the highest since November 2024 ($31.9 billion). “With the optimism which has come in the month of April, I am very sure that India will maintain this export momentum and it should be a good year for us in spite of all the problems we will be facing in the external sector,” Barthwal said. Continued on Page 11 Infosys trims Q4 bonus to 65% as profit slides INFOSYS HAS SLASHED its average variablebonuspayoutto65%forthe January-March quarter of FY25,citing a weak macroeconomic environment and a dip in profitability. The move affects employees in Band 6 and below, primarily covering junior- and mid-level roles. Whilepayoutsvarybyindividual performance, sources said thathighperformerscouldreceiveup to 83%,whereas thosewith a“needs improvement” ratingwill get none. The reduction in Q4 bonuses marks a continued decline over the past year. In Q3, Infosys had disbursed80%bonuspayoutandinQ2, 90%.The internal communication acknowledged the challenges faced during the quarter.The bonus cut follows a 12% year-on-year drop in net profit to `7,033 crore for the March quarter. This trend isn’t isolated. RivalTataConsultancyServices has also adjusted its variable compensation. Senior employees at TCS received only20-30% of theirquarterly variable allowance for the fourth quarter. —FE BUREAU Ahmedabad