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SIDBI MSME Outlook Survey: India’s Small Business Economy

SIDBI MSME Outlook Survey: India’s Small Business Economy

The latest findings from SIDBI’s MSME outlook survey reveal a strengthening business confidence among Indian Micro, Small, and Medium Enterprises (MSMEs). The Composite MSME Business Confidence Index (M-BCI) for the first quarter of FY2026 (April–June 2025) has climbed to 63.75, a notable increase from 60.82 in the previous quarter. This positive shift indicates a generally favourable business environment for small business across India.

Manufacturing and trading sectors have experienced particularly sharp improvements in confidence. The services sector, while already strong, continues to maintain a high confidence level above 60, demonstrating sustained optimism within this segment of the MSME economy.

Looking ahead, the outlook remains promising. The Composite MSME Business Expectations Index (M-BEI) currently stands at 62.19 for the next quarter. Projections show a further rise to 67.88 for the corresponding quarter next year, indicating a robust long-term outlook. Sentiments are especially strong in the trading and services sectors, with the M-BEI for Q1FY2027 recorded at 68.32 and 68.24 respectively.

While a moderate dip in expectation indices is observed for Q2FY2026, this likely reflects near-term global uncertainties impacting the MSME sector. However, the overall trend suggests that long-term optimism remains firmly intact, pointing towards continued growth and resilience within the MSME economy.
Msme Sector Challenges
Despite the overall positive sentiment reflected in the latest MSME outlook survey, the sector continues to grapple with a number of significant challenges. Access to adequate and timely finance remains a persistent hurdle for many small business in India. While the survey indicates improvements in working capital availability, many MSMEs, particularly those in rural or underserved areas, still struggle to secure loans and credit at competitive interest rates. This financial constraint often limits their ability to invest in technology upgrades, expand operations, and effectively manage their cash flow.

Another key challenge highlighted by the survey is the availability of skilled labour. The rapid pace of technological advancements and evolving industry demands require MSMEs to have access to a workforce equipped with the necessary skills and expertise. However, many MSMEs face difficulties in attracting and retaining skilled employees, leading to skill gaps and hindering their productivity and competitiveness. Addressing this skills gap through targeted training programmes and industry-academia collaborations is crucial for the sustained growth of the MSME economy.

The survey also sheds light on the challenges related to the ease of doing business. Complex regulatory procedures, bureaucratic hurdles, and compliance requirements often create significant obstacles for MSMEs, diverting their time and resources away from core business activities. Streamlining regulatory processes, reducing compliance burdens, and promoting a more business-friendly environment are essential for fostering the growth and development of the MSME sector. Additionally, global economic uncertainties and supply chain disruptions continue to pose challenges for MSMEs, impacting their sales, profitability, and overall business outlook. The April-June 2025 period may bring specific challenges, requiring proactive measures to mitigate potential risks.

In addition to these challenges, MSMEs are also facing increasing competition from larger enterprises and global players. To remain competitive, MSMEs need to embrace innovation, adopt new technologies, and enhance their product and service offerings. SIDBI plays a crucial role in supporting MSMEs in overcoming these challenges by providing access to finance, promoting skill development, and advocating for policy reforms that create a more conducive business environment for the MSME sector in India.
Sidbi’s Response
In response to the challenges and opportunities identified in the outlook survey, SIDBI is actively engaged in a multi-pronged approach to support the MSME sector. A key focus area is enhancing access to finance for small business. SIDBI offers a range of financial products and services tailored to the specific needs of MSMEs, including term loans, working capital finance, and equity investments. It is also actively promoting digital lending platforms and fintech solutions to improve the efficiency and reach of its financial assistance programmes. SIDBI has significantly scaled up its partnerships with banks and other financial institutions to enhance credit flow to MSMEs across India, particularly in underserved regions.

Recognising the critical importance of skill development, SIDBI is also investing in initiatives to address the skills gap in the MSME sector. It supports training programmes and vocational courses that equip MSME employees with the skills and knowledge required to thrive in a rapidly evolving business environment. SIDBI also facilitates industry-academia collaborations to ensure that training programmes are aligned with the needs of the MSME sector. These programmes aim to boost the productivity and competitiveness of the MSME economy.

Furthermore, SIDBI actively advocates for policy reforms that promote a more conducive business environment for MSMEs. It works closely with government agencies and other stakeholders to streamline regulatory processes, reduce compliance burdens, and promote ease of doing business. SIDBI also plays a crucial role in creating awareness about government schemes and initiatives designed to support the MSME sector. This includes providing guidance and support to MSMEs in accessing these schemes and complying with relevant regulations. The April-June 2025 period is likely to see further refinements in SIDBI’s approach, informed by the findings of the MSME outlook survey, ensuring its interventions remain relevant and impactful for small business in India. SIDBI’s commitment is to foster a vibrant and resilient MSME economy.

July 31, 2025
Govt policies boost manufacturing and services

Govt policies boost manufacturing and services

The government has implemented a series of policies designed to bolster both the manufacturing and service sectors, aiming for comprehensive economic growth. These policies encompass a range of initiatives, from financial incentives to regulatory reforms, all geared towards creating a more favourable environment for businesses to thrive. FM Sitharaman has been a key proponent of these strategies, emphasizing the importance of a multi-pronged approach to economic development.
A central tenet of the government’s approach involves targeted support for specific industries. This includes streamlining bureaucratic processes, reducing compliance burdens, and fostering innovation through research and development grants. The policies aim to attract both domestic and foreign investment, thereby increasing capacity and competitiveness within the manufacturing and service sectors. These measures are designed to unlock the full potential of the Indian economy.
To boost manufacturing in the country, India is focussing on 14 priority sectors or sunrise sectors like electronics, semi-conductors, and pharma. The government is also actively working on improving infrastructure, including transportation and logistics networks, to facilitate the smooth movement of goods and services across the country. This infrastructure development is considered crucial for supporting the long-term growth of both the manufacturing and service sector, and enhancing India’s position in the global economy.
Manufacturing Sector Growth
The government’s commitment to enhancing the manufacturing landscape is evident in the tangible growth observed across various sub-sectors. Specific policies, such as the Production Linked Incentive (PLI) scheme, have incentivised domestic production and attracted significant investment in key areas. The PLI scheme offers financial support to companies that meet certain production targets, encouraging them to expand their operations and increase output. This has been particularly effective in sectors like electronics and automotive, where India is striving to become a global manufacturing hub.
The automotive industry, for example, has witnessed a surge in manufacturing activity, driven by both domestic demand and export opportunities. The government’s support for electric vehicle (EV) production has further boosted the sector, with several companies announcing plans to manufacture EVs and related components in India. This push towards sustainable transportation is not only benefiting the manufacturing sector but also contributing to environmental goals.
Furthermore, the focus on skill development is playing a crucial role in supporting manufacturing growth. Initiatives like the Skill India Mission are equipping the workforce with the necessary skills to meet the evolving demands of the industry. By providing training and vocational education, the government is ensuring that the manufacturing sector has access to a skilled labour pool, which is essential for maintaining competitiveness and driving innovation. FM Sitharaman has emphasised the importance of a skilled workforce in achieving the government’s manufacturing goals.
Services Sector Expansion
The service sector, a cornerstone of the Indian economy, has also experienced substantial expansion due to targeted government policies. This growth spans across various sub-sectors, including IT, tourism, healthcare, and financial services. The government’s focus on creating a conducive environment for businesses has been instrumental in attracting investment and fostering innovation within these areas.
The IT sector, in particular, has been a major beneficiary of the government’s support. Policies aimed at promoting digital infrastructure, such as the BharatNet project, have enhanced connectivity and accessibility, enabling IT companies to expand their reach and offer services to a wider customer base. Furthermore, the government’s emphasis on skill development in emerging technologies like artificial intelligence and machine learning has ensured that the IT sector remains competitive on a global scale. This has resulted in significant export growth and job creation within the sector.
The tourism sector has also witnessed a resurgence, with the government actively promoting India as a preferred tourist destination. Initiatives like the “Incredible India” campaign and the development of tourism infrastructure have attracted both domestic and international tourists. The government’s efforts to improve connectivity, including the expansion of airports and the development of tourist circuits, have further boosted the sector. This growth in tourism has not only generated revenue but has also created employment opportunities in related industries such as hospitality and transportation.
Moreover, the government has been actively working on reforms in the financial services sector to enhance its efficiency and stability. Measures such as the introduction of digital payment systems and the promotion of financial inclusion have transformed the landscape of the sector. The government’s support for fintech companies has fostered innovation and competition, leading to improved services and greater accessibility for consumers. FM Sitharaman has highlighted the crucial role of the service sector in driving overall economic growth and creating employment opportunities.
Economic Impact Analysis
The government’s policies aimed at boosting both manufacturing and the service sector are having a discernible impact on the overall economy. Analysis reveals a positive correlation between these policies and key economic indicators, such as GDP growth, employment generation, and investment levels. The increased activity in both sectors is contributing to a more robust and diversified economy, reducing reliance on specific industries and creating a more resilient economic structure.
Specifically, the manufacturing sector’s growth is translating into increased production, higher export volumes, and greater employment opportunities, particularly for skilled and semi-skilled workers. The Production Linked Incentive (PLI) schemes, for example, are not only attracting investment but also fostering technological upgrades and innovation within the manufacturing sector. This is leading to enhanced competitiveness and a greater ability to meet both domestic and international demand.
Similarly, the expansion of the service sector is driving economic growth through increased exports of IT services, tourism revenue, and financial service activities. The government’s support for digital infrastructure and skill development is ensuring that the service sector remains a key engine of growth, contributing significantly to GDP and creating high-value jobs. Furthermore, the growth in the service sector is also supporting the manufacturing sector by providing essential services such as logistics, transportation, and financial support.
FM Sitharaman has emphasised that the combined impact of these policies is creating a virtuous cycle of economic growth. Increased investment and production are leading to higher incomes and greater consumer spending, which in turn is driving further growth in both the manufacturing and service sectors. This positive feedback loop is essential for achieving sustainable and inclusive economic development, ensuring that the benefits of growth are shared across all segments of society. The government continues to monitor the impact of its policies and make adjustments as needed to ensure their effectiveness and maximise their contribution to the economy.
Future Policy Directions
Looking ahead, the government is committed to refining its policies to ensure sustained growth in both the manufacturing and service sectors. A key focus will be on streamlining regulatory processes further, reducing compliance costs, and fostering a more business-friendly environment. The aim is to attract even greater levels of domestic and foreign investment, thereby boosting capacity and competitiveness across various industries. FM Sitharaman has repeatedly stated the importance of adaptability and responsiveness in policy-making, emphasizing the need to continuously assess and adjust strategies based on evolving economic conditions and global trends.
One area of particular attention will be promoting innovation and technological advancement. The government plans to increase investment in research and development, support start-ups, and encourage collaboration between industry and academia. This will involve creating a more conducive ecosystem for innovation, including strengthening intellectual property rights and providing access to funding and mentorship. The goal is to position India as a global hub for innovation, attracting talent and investment in cutting-edge technologies.
Furthermore, the government recognises the importance of addressing infrastructure gaps to support long-term economic growth. Plans are underway to further improve transportation networks, enhance digital connectivity, and upgrade energy infrastructure. This includes expanding highways, railways, and airports, as well as investing in renewable energy sources and smart grid technologies. These infrastructure improvements will not only facilitate the movement of goods and services but also improve the overall quality of life for citizens.
Skill development will remain a top priority, with the government aiming to equip the workforce with the skills needed to meet the evolving demands of the manufacturing and service sectors. This will involve expanding vocational training programs, promoting apprenticeships, and fostering closer collaboration between industry and educational institutions. The goal is to create a skilled labour pool that is capable of driving innovation, enhancing productivity, and supporting the growth of high-value industries. The government’s continued support in these areas will be crucial for ensuring the long-term competitiveness of the Indian economy.

May 7, 2025
India’s SMEs: Engines of Economic Growth

Booming Businesses: The Impact of Indian SMEs

SME Contributions to the Indian Economy
Small and medium enterprises (SMEs), often referred to as MSMEs in India, are the backbone of the Indian economy. Their contribution to the nation’s overall growth is undeniable and multifaceted. They represent a significant portion of India’s GDP, employing millions and generating a substantial amount of revenue. These businesses, ranging from tiny workshops to larger manufacturing units, are crucial for driving economic activity across diverse sectors. Their contribution extends beyond mere economic output; they play a vital role in fostering innovation, entrepreneurship, and competition within the market. The sheer number of SMEs ensures widespread economic participation, reducing regional disparities and creating opportunities in even the most remote areas. Furthermore, the flexibility and adaptability of SMEs allow them to respond quickly to changing market demands, contributing to a dynamic and resilient economy. The significant contribution of SMEs to job creation is particularly noteworthy, providing employment for a vast segment of the Indian population, many of whom are from rural areas and would otherwise struggle to find work. Their widespread presence ensures a broader distribution of income and wealth across the country. The ongoing growth of the SME sector is therefore essential for continued and inclusive economic development in India.
Challenges Faced by Indian SMEs
Indian SMEs face a multitude of challenges that hinder their growth and contribution to the national economy. Access to finance remains a significant obstacle. Many SMEs struggle to secure loans from traditional banking institutions due to perceived high risk and lack of collateral. This often forces them to rely on informal lending sources, which can be expensive and unsustainable. Furthermore, the complex and often bureaucratic regulatory environment adds to their difficulties. Navigating licensing procedures, tax regulations, and labour laws can be time-consuming and costly, diverting resources from core business activities. The lack of access to modern technology and infrastructure also presents a major challenge. Many SMEs, particularly those in rural areas, lack access to reliable electricity, internet connectivity, and advanced equipment, limiting their productivity and competitiveness. Competition from larger, more established businesses, both domestic and international, can also be intense, putting pressure on smaller enterprises to keep prices low and maintain quality. The skills gap is another significant issue. Many SMEs struggle to find and retain skilled employees, hindering their ability to innovate and expand. This is exacerbated by the lack of adequate vocational training and education in many parts of India. Finally, the volatility of the Indian economy, particularly fluctuations in commodity prices and exchange rates, can significantly impact the profitability and sustainability of SMEs. Addressing these challenges is crucial for unlocking the full potential of the MSME sector and ensuring its continued contribution to India’s economic growth and job creation.
The informal nature of a large portion of the SME sector in India further complicates the challenges. Many small businesses operate outside the formal economy, lacking the necessary registrations and licenses. This makes it difficult for them to access formal credit, participate in government support schemes, and benefit from various economic incentives. This informality also limits their ability to scale up and compete effectively with larger, more formal businesses. The lack of proper record-keeping and accounting practices within the informal sector further hinders access to finance and makes it difficult to assess their true contribution to the GDP.
Moreover, the impact of global economic shocks and unforeseen events, such as the recent pandemic, disproportionately affects SMEs due to their limited financial reserves and resilience. The lack of robust risk management strategies and business continuity plans further exacerbates their vulnerability. Consequently, supporting SMEs to formalise their operations, improve their financial management practices, and build resilience to external shocks is critical for ensuring their long-term sustainability and contribution to India’s economic growth.
Growth Strategies and Support for SMEs
Several strategies can be implemented to foster the growth and development of India’s SMEs. Access to finance is paramount, and initiatives such as government-backed loan guarantee schemes and microfinance institutions can play a crucial role in providing much-needed capital. Simplifying the regulatory environment, reducing bureaucratic hurdles, and promoting digitalisation of processes can significantly ease the burden on SMEs. This includes streamlining licensing procedures, simplifying tax regulations, and implementing online platforms for various business registrations. Investment in infrastructure development, particularly in rural areas, is also vital to improve connectivity, access to electricity, and other essential services that SMEs rely on. This includes initiatives to improve internet penetration and reliable power supply, crucial for productivity and competitiveness.
Furthermore, promoting skill development and vocational training programs can address the skills gap within the SME sector. Collaborations between educational institutions, industry bodies, and SMEs can create tailored training programs that meet the specific needs of businesses. Government support in this area could include subsidies for training, apprenticeships, and skill development initiatives. Encouraging the adoption of modern technology and innovation is crucial for enhancing productivity and competitiveness. This can be achieved through targeted government subsidies, tax incentives, and technology transfer programs. Furthermore, promoting entrepreneurship and innovation through incubators and business accelerators can foster the growth of new and innovative SMEs.
Supporting the formalisation of the SME sector is essential for unlocking its full potential. Government initiatives aimed at simplifying the registration process, providing incentives for formalisation, and improving access to formal credit can encourage more SMEs to transition into the formal economy. This includes simplifying tax compliance procedures, reducing the burden of paperwork, and providing assistance with compliance requirements. Improving access to market information and business development services can also empower SMEs to make informed decisions and improve their competitiveness. This could involve establishing business information centres, providing access to market research data, and facilitating networking opportunities. Government support in the form of grants, subsidies, and tax breaks can also incentivize SMEs to adopt best practices in areas such as financial management, environmental sustainability, and social responsibility. The success of these strategies depends on effective implementation, monitoring, and evaluation to ensure that the support reaches the intended beneficiaries and achieves its objectives. The ultimate goal is to enable India’s SMEs to become significant drivers of economic growth and job creation, fostering inclusive and sustainable development.
Promoting collaboration and networking amongst SMEs can foster knowledge sharing, innovation, and collective bargaining power. Industry associations and business networks can play a crucial role in facilitating these collaborations. Government support in this area could involve funding for industry associations, facilitating networking events, and promoting the development of industry clusters. Addressing the challenges faced by SMEs is crucial for unleashing their full potential and ensuring their significant contribution to India’s economic growth and job creation.

March 21, 2025
Ixigo IPO Heats Up: Strong Initial Response Raises Eyebrows

Ixigo IPO Heats Up: Strong Initial Response Raises Eyebrows

The much-anticipated IPO (Initial Public Offering) of Ixigo, the travel technology company behind the popular travel search platform of the same name, has generated significant buzz in the Indian stock market.
Oversubscribed Debut
On its opening day (June 10th, 2024), the Ixigo IPO received a robust response from investors, with reports indicating it was oversubscribed. This strong initial showing suggests investor confidence in Ixigo’s growth potential within the Indian travel tech sector.
IPO Details
The public issue is a combination of fresh issue (₹120 crore) and Offer for Sale (OFS) (₹620.10 crore), raising a total of ₹740.10 crore. The price band has been set at ₹88 to ₹93 per equity share, with a minimum investment amount of ₹14,973 for retail investors. The lot size is 161 shares.
Listing and Allotment
The bidding window for the IPO remains open until June 12th, 2024. Allotment of shares is expected to be finalized on June 13th, with a tentative listing date set for June 18th on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE).
Reasons for Investor Interest
Several factors might be contributing to the positive investor response. The travel and tourism industry in India is expected to witness significant growth in the coming years, and Ixigo’s established brand presence and online travel platform could position it well to capitalize on this trend. Additionally, the company’s focus on technology and innovation might be seen as a competitive advantage.
Overall, the Ixigo IPO has gotten off to a promising start. However, potential investors should conduct thorough research and due diligence before committing their funds. While Ixigo boasts a strong brand name, a closer look at its financial performance might be necessary before making any investment decisions. With a competitive travel tech landscape in India, it’s crucial to assess whether the IPO price accurately reflects Ixigo’s long-term value proposition.

For more information on Ixigo’s IPO, read more here: https://www.news18.com/business/ixigo-ipo-gets-strong-response-subscribed-1-95-times-on-first-day-8928977.html

June 11, 2024
Why Sustainability Reporting Matters for SMEs

Small Business, Big Impact: Why Sustainability Reporting Matters for SMEs

A new guide from ACCA (the Association of Chartered Certified Accountants) recognizes the vital role Small and Medium-sized Enterprises (SMEs) play in global supply chains. Their guide, titled “Sustainability Reporting – SME Guide,” empowers SMEs to create the sustainability reports increasingly demanded by regulators and stakeholders.
Sundeep Jakhar, head of public affairs for ACCA in India, emphasizes the importance of sustainability practices for Indian SMEs, which make up a significant portion of the Indian business landscape. He acknowledges their unique challenges, such as limited resources, but highlights the numerous benefits sustainability reporting can unlock, including access to new markets and better financing opportunities. This translates to improved competitiveness on a global scale for Indian SMEs, helping them align with international standards.
Report co-author Sharon Machado, head of sustainable business at ACCA, explains that creating and using sustainability information empowers SMEs, their advisors, and stakeholders to identify opportunities, manage risks, and ultimately strengthen their financial position. This translates to easier investment attraction, preferential terms with suppliers, and a competitive edge in the talent pool.
As the demand for sustainability information rises, all organizations, including SMEs (which comprise 90% of all organizations globally), need to be prepared to provide information on their approach to managing sustainability risks and opportunities. This information is crucial for regulators, investors, and other stakeholders throughout the value chain.
The ACCA guide highlights the competitive advantage SMEs can gain by communicating and using sustainability information. Report co-author Aaron Saw, head of corporate reporting insights at ACCA, acknowledges the challenges SMEs might face, especially financially. However, he emphasizes that evidence shows the effort is worthwhile. The ACCA encourages all SMEs to take small but crucial first steps towards creating sustainability reports, paving the way for a stronger and more competitive business.

You can read here to learn more: https://smefutures.com/sustainability-related-information-enables-better-business-for-smes-says-new-guide-from-acca/

May 30, 2024
India Must Create 115 Million Jobs by 2030 to Sustain Economic Growth: Study

“India Must Create 115 Million Jobs by 2030 to Sustain Economic Growth: Study”

India needs to create 115 million jobs by 2030 as more people enter the workforce, according to a study, emphasizing the need to boost services and manufacturing to sustain economic growth.
Asia’s third-largest economy will have to generate 16.5 million jobs annually, up from the previous decade’s 12.4 million per year, according to Trinh Nguyen, a senior economist at Natixis SA. Of these, about 10.4 million jobs will need to come from the formal sector.
“To achieve this Herculean task, India’s growth engine needs to fire on all cylinders, from manufacturing to services over the next five years,” Nguyen wrote in a research note.
Although India’s economy is expected to grow by more than 7% this year — one of the fastest rates globally — this pace is still not sufficient to create jobs for its 1.4 billion people. High youth unemployment remains a significant challenge for Prime Minister Narendra Modi as he seeks a third term in the upcoming national elections.
Despite the creation of 112 million jobs over the last decade, only about 10% of these are formal, Nguyen noted. India’s overall labor force participation rate is 58%, much lower than other Asian nations, according to the World Bank.
Nguyen pointed out that India’s services sector, which constitutes more than half of the GDP, has limited capacity for headcount growth and labor quality. Therefore, India can leverage the manufacturing sector to compete with firms and countries looking to diversify away from a China-centric supply chain.
“The incoming administration needs to jump on the manufacturing train and capitalize on demographic and geopolitical tailwinds,” Nguyen stated. “Even if the road forward is challenging, it is never too late to walk down the right path.”

Originally Posted on: https://www.business-standard.com/economy/analysis/india-must-create-115-mn-jobs-by-2030-as-more-people-enter-workforce-study-124052001062_1.html

May 21, 2024
Driving Factors: Technology’s Role in Shaping India’s Electric Two-Wheeler Adoption

Driving Factors: Technology’s Role in Shaping India’s Electric Two-Wheeler Adoption

Technological factors have the potential to either impede or accelerate the adoption of electric two-wheelers in India’s evolving electric vehicle (EV) ecosystem, which has witnessed significant growth in recent years supported by government and private sector initiatives. The interim budget also outlined various measures aimed at expediting the expansion of the domestic EV ecosystem, including bolstering charging infrastructure.
As the EV landscape evolves, it becomes evident how policies, market conditions, and technological advancements influence consumer acceptance of these vehicles. Technology emerges as a critical determinant for the adoption of EVs, particularly in the two-wheeler segment, which constitutes one of the largest automobile segments in India.
According to Sushant Kumar, Founder & Managing Director of AMO Mobility, battery technology plays a pivotal role. Advancements in lithium-ion batteries and the emergence of solid-state batteries enhance efficiency, safety, and charging speed, which are crucial for extending vehicle range and enhancing user convenience. Motor technology also significantly impacts performance, with innovations such as brushless DC motors offering improved efficiency and requiring less maintenance.
Furthermore, material science advancements enable the use of lightweight materials that improve range and performance without compromising safety. Kumar notes that these technological strides collectively shape the future of electric two-wheelers, making them more attractive and efficient for consumers.
Anshul Gupta, Managing Director of Okaya EV, emphasizes the importance of finding the right technology as EVs are still in the pilot phase. He highlights the necessity of progressing charging infrastructure, including rapid charging methods and battery swapping techniques, to address concerns about range anxiety and promote widespread adoption.
In the evolving landscape of EV technology, particularly concerning two-wheelers, several technological factors are poised to influence their future development, experts believe.
Prashant Vashishtha, Chairman & Managing Director of Sokudo India, underscores the significance of battery technology advancements, including shifts to more advanced formulations like solid-state or lithium-sulfur batteries promising higher energy densities and faster charging times. Motor technology is expected to advance further, focusing on increasing efficiency and reducing weight, while electronic control systems become more sophisticated to enhance vehicle dynamics and user interfaces.
The integration of IoT and AI technologies plays a vital role in facilitating real-time vehicle diagnostics, enhancing user experience, and increasing vehicle reliability. These technologies contribute to predicting battery life, optimizing energy management, and improving overall vehicle efficiency, according to industry stakeholders.
Gupta also highlights safety as a primary concern for customers due to high voltages and temperatures associated with EVs. LFP batteries are considered safer than NMC batteries due to their higher thermal runaway temperature and longer lifespan, despite requiring more space.
Overall, infrastructure improvements such as fast-charging stations and connectivity features like GPS navigation, coupled with supportive government policies and incentives, contribute to the growing popularity of electric two-wheelers in India’s dynamic mobility landscape.

May 14, 2024
Repercussions of a Clean Technology Trade War: Lessons from History

Repercussions of a Clean Technology Trade War: Lessons from History

What happens when a leading trading nation faces the reality that its supremacy is waning?
For the first country to grapple with this dilemma — Britain — it led to an enduring identity crisis that continues more than a century later. As the United States confronts a similar crossroads, it must weigh whether free trade or protectionism holds the promise of greater prosperity.
In the 19th century, the UK’s fusion of manufacturing prowess and open commerce propelled it to pre-eminence. By the late 1800s, it accounted for approximately a quarter of the world’s industrial output. However, beneath this imperial confidence lay deep-seated anxieties triggered by the ascent of new global powers.
In Chicago, the Union Stock Yards sprawled over an area half the size of the old City of London, employing tens of thousands and processing enough meat to feed 80% of America’s population. Henry Ford replicated the Yards’ production-line innovations in Detroit to establish car factories on an unprecedented scale. Meanwhile, in Ludwigshafen, south of Stuttgart, Britain ceded its early lead in chemicals to BASF SE, whose vast integrated plants conferred near-monopoly status on Germany by 1900.
Joseph Chamberlain, a former titan of the world’s largest screw-making business and now a prominent British politician, saw the solution in a departure from the Empire’s free-trade ethos. “Tariffs! They are the politics of the future, and of the near future,” he declared at a parliamentary dinner in 1902.
The resultant policy, Imperial Preference, proposed steep levies on imports from outside the Empire. This protectionist approach dominated until the Second World War shattered Britain’s global pretensions, casting a long shadow over its turbulent relationship with the European Union’s trading bloc.
The parallels with present-day America, grappling with China’s manufacturing prowess, are stark. Like late Victorian Britain, a dominant power faces a rival endowed with abundant land, labor, and capital, rapidly closing the gap. Moreover, China’s investments and monumental industrial infrastructure overshadow competitors. China’s dominance of the clean technology supply chain appears near-absolute, producing 84% of the world’s solar modules, 86% of lithium-ion batteries, and a substantial share of wind turbine components and electrolyzers for green hydrogen.
President Joe Biden’s recent remarks underscore America’s response to this challenge, signaling a stance against China’s economic practices with higher tariffs on its products.
The experience of Britain’s brief experiment with protectionism offers cautionary lessons. Despite early 20th-century angst, the UK remained a top-five manufacturing power until the 2000s, when it was overtaken by China, Italy, South Korea, India, Mexico, and Russia. In contrast, nations embracing protectionism encountered stunted manufacturing sectors and enduring debt burdens.
While the United States is unlikely to face such dire consequences, it faces a shifting global landscape where multiple industrial giants vie for dominance. Sustaining its hegemony will require avoiding isolationist tendencies and embracing strategic engagement in the global economy.

May 7, 2024
India’s Economic Resurgence

India’s Economic Resurgence: A Lesson for Harvard Business School

Finance Minister Nirmala Sitharaman highlighted India’s remarkable economic turnaround, particularly in the banking sector, since 2014, suggesting it as a case study worthy of the Harvard Business School. Speaking at the Gujarat Chambers of Commerce and Industry (GCCI) in Ahmedabad on the theme “Vikshit Bharat 2047,” Sitharaman praised the transformation in India’s banking landscape and the governmental reforms undertaken post-2014.
Sitharaman outlined the challenges faced by Indian banks, notably the twin balance sheet problem in 2014, which burdened them with non-performing assets (NPAs) and hampered lending to businesses. Drawing parallels with the collapse of the Silicon Valley bank in the US, she commended Indian banks’ resilience during the pandemic and their adept management of mergers for stability.
Despite hurdles like merger-related issues and liquidity challenges, Sitharaman expressed confidence in India’s future, envisioning a prosperous “Vikshit Bharat” by 2047 through sustained collective efforts. She emphasized the pivotal role of stakeholders in achieving this vision, underlining the government’s commitment to driving growth and development.
The minister contrasted India’s economic resilience with challenges faced by Western nations in post-COVID bank management, reinforcing the significance of continued efforts to maintain bank health and stability in India’s growth trajectory.

Originally posted on: https://economictimes.indiatimes.com/news/economy/policy/restoration-of-indian-economy-since-2014-a-case-study-for-harvard-says-nirmala-sitharaman/articleshow/109453316.cms?from=mdr

April 22, 2024