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India’s 2025 Policy Push: Enhancing Ease of Doing Business, Global Trade, and Attracting Foreign Direct Investment in India India Announces PLI Scheme for Passive Electronics On March 28, 2025, India introduced an INR 229.19 billion Production Linked Investment (PLI) Scheme to enhance and boost domestic manufacturing of passive electronic components thereby reducing reliance on imported components even for global players. The Central Government has approved this initiative, which is expected to attract significant investments from both domestic and international stakeholders which will improve the country’s standing in the global electronics supply chain. Passive electronic components include resistors, capacitors, inductors, transformers, etc. This marks the first move in India to include these passive electronic components under a dedicated PLI scheme, redefining the strategic approach towards the sector in India. The segment will be a part of the PLI scheme, which will be implemented over six years. It is anticipated that the PLI scheme will enhance domestic value addition, enabling the expansion of operations by Indian manufacturers and improving global competitiveness. Key sectors expected to benefit include telecom, consumer electronics, automobiles, medical devices, and power, among others. This initiative is a strategic step toward boosting domestic manufacturing and strengthening India’s role in the global electronics supply chain. India Launches DGFT Global Tariff and Trade Helpdesk to Support Exporters and Importers On April 11, 2025, the Directorate General of Foreign Trade (DGFT), under the Union Ministry of Commerce and Industry, launched the Global Tariff and Trade Helpdesk. This dedicated online platform is designed to assist Indian businesses in navigating emerging global trade challenges. The helpdesk serves as a central point of contact for exporters and importers, addressing a broad range of trade-related concerns, including: – Difficulties in export or import operations – Sudden surges in imports or instances of commodity dumping – Delays in EXIM clearance processes – Disruptions in supply chains or logistics – Financial, banking, or transactional constraints – Compliance with evolving global regulatory requirements This initiative aims to enhance coordination between trade stakeholders and central government agencies, ensuring that policy responses remain responsive to real-time trade developments. Cap on Compounding Penalty for Non-Reporting Contraventions under FEMA, 1999 – A Significant Step Towards Ease of Doing Business in India Existing Provisions for Compounding of Contraventions under FEMA, 1999: Section 13 of the FEMA Act, 1999, empowers the Adjudicating Authority to impose penalties on contravention of the provisions of the FEMA framework, 1999. The penalty for such contraventions shall be as follows: – Up to 3 times the sum involved in the transaction, where the amount involved is quantifiable, or – Up to INR 0.2 million, where the amount is not readily quantifiable. – If there is a continuous contravention, the penalty shall extend to INR 5000 for every day after the first day during which the contravention continues. Amendment in Provisions for Compounding of Contraventions under FEMA, 1999: Capping the penalty for all other non-reporting contraventions- On April 24, 2025, the Reserve Bank of India (RBI) made a further amendment to the existing provisions by adding a discretionary power to the compounding authority, provided the authority is satisfied based on the nature of the contravention, exceptional circumstances/facts involved in the concerned case, and in the public interest. The key amendments include: – The maximum compounding amount imposed for select contraventions may be capped at INR 2,00,000 for contravention of each provision. – For all other non-reporting contraventions, a fixed compounding amount of INR 50,000 and a variable compounding amount depending on the duration of the contravention, ranging between 0.5% to 0.75% of the amount involved in the contravention. Why This is a Significant Step Towards Ease of Doing Business in India: These amendments indicate the RBI’s efforts to expedite the compounding process, ensuring greater efficiency and time effectiveness. As a result, this marks a significant step towards enhancing the ease of doing business in India by simplifying regulatory compliance for entities. India-Australia Outline 2025 Trade Plan; India-UK Deal Concluded, NZ Pact Talks Ongoing India-Australia Deepen Economic Ties with Ambitious 2025 Roadmap In 2022, India and Australia implemented the first phase of a free trade agreement, the Australia-India Economic Cooperation and Trade Agreement (ECTA). According to industry experts, the agreement, which came into force in December, has provided significant financial benefits to Australian businesses. Over the past years, India has expanded its presence through investments in Australia, showcasing increased confidence in Australia’s economy with a view to extending bilateral ties. According to data from the Australian Department of Foreign Affairs and Trade (DFAT), India ranked 15th among foreign investors in Australia in 2023. To further strengthen bilateral trade ties, both countries are actively working toward finalizing a more comprehensive pact, the Comprehensive Economic Cooperation Agreement (CECA). This agreement is expected to unlock additional economic opportunities. The aforesaid comprehensive agreement focuses on four key sectors clean energy, education and skills, agribusiness, and tourism which are expected to serve as the primary source of future growth and cooperation between the two countries. By leveraging Australia’s expertise in renewable energy, promoting educational and vocational training programs, expanding agribusiness collaboration, and strengthening the tourism industry, it is believed that stronger future growth can be achieved. India-UK Trade Pact On May 6, 2025, India achieved a major milestone with the successful conclusion of the India–UK Free Trade Agreement (FTA). This landmark agreement marks a new chapter in the economic relationship between the two nations, fostering a closer and more dynamic trade partnership. The primary objective of the FTA is to attract greater investment, leading to increased job creation, enhanced economic collaboration, and the establishment of a robust strategic alliance between India and the United Kingdom The following sectors have a significant impact due to this FTA. Automobiles: Tariffs on UK luxury cars and EVs will be reduced from 100% to 10% over five years, under a defined quota system. This will increase the imports of automobiles from the UK, enhancing opportunities for UK businesses to expand in India’s growing market and thereby contributing to the growth … Read more