India Expands Trade Push with Philippines PTA and Maldives FTA Talks
India has formalised the terms of reference (ToR) with the Philippines and the Maldives to initiate negotiations on new trade agreements, according to the Commerce Ministry. While talks with the Philippines will focus on a preferential trade agreement (PTA) covering tariff reductions on selected goods, discussions with the Maldives aim for a broader free trade agreement (FTA), encompassing tariff cuts across a wider range of goods along with provisions for services and investments. Bilateral trade trends show India’s exports to the Philippines rising modestly to $2.16 billion in 2024–25 even as imports declined, whereas trade with the Maldives saw Indian exports fall sharply while imports increased.
The move comes amid India’s wider effort to recalibrate and expand its trade architecture, including ongoing reviews of its ASEAN goods agreement and the India–Korea CEPA, alongside fresh negotiations with partners such as the GCC, Canada, EU, and New Zealand. Recent FTAs with the UK and Oman are also expected to be implemented soon. For non-Indian companies, these developments signal evolving market access conditions, potential tariff advantages, and shifting supply chain dynamics in South and Southeast Asia, making it important to track sector-specific provisions and rules of origin that may influence competitiveness and investment decisions.
Editor’s Note: India has initiated trade talks with the Philippines for a preferential trade agreement and with the Maldives for a broader free trade agreement, aiming to expand tariff reductions and investment opportunities. These moves are part of India’s wider strategy to recalibrate its trade architecture, alongside ongoing reviews and new negotiations with partners such as ASEAN, Korea, GCC, Canada, EU, and New Zealand.
India’s Data Centre Capacity Quadruples, Government Backs AI Growth with Subsidised Compute and Power Planning
India’s data centre industry is witnessing steady expansion, with total capacity rising from around 375 MW in 2020 to approximately 1,500 MW by 2025, according to information presented in the Rajya Sabha by Jitin Prasada. To accelerate artificial intelligence development, the government has onboarded 38,231 GPUs through 14 empanelled service providers under its AI compute capacity framework, offering access to startups, researchers, and academia at a subsidised average rate of ₹65 per hour—roughly one-third of global costs. Data centres are distributed across key hubs including Mumbai, Navi Mumbai, Hyderabad, Bengaluru, Noida, and Jamnagar, reflecting a geographically diversified infrastructure build-out.
The government has also factored in the rising infrastructure demands of AI-driven growth, projecting electricity consumption from data centres to reach 13.56 GW by 2031–32, alongside continuous expansion of national transmission networks to ensure reliable supply. The recently passed SHANTI Act aims to strengthen the nuclear energy ecosystem, supporting future deployment of small modular and micro reactors to power emerging sectors. Meanwhile, the industry is adopting advanced cooling technologies and high-density racks to optimise water and energy use under existing groundwater regulations. For non-Indian companies, these developments highlight India’s emergence as a cost-competitive AI and data infrastructure hub, offering opportunities for cloud providers, semiconductor firms, and investors to tap into subsidised compute resources, scalable capacity, and evolving energy frameworks.
https://www.pib.gov.in/PressReleasePage.aspx?PRID=2239616®=3&lang=1
Editor’s Note: India’s data centre capacity is set to quadruple from 375 MW in 2020 to 1,500 MW by 2025, with hubs across major cities and government-backed AI compute access at subsidised rates. To support this growth, the government projects data centre power demand to reach 13.56 GW by 2031–32, while advancing nuclear energy, cooling technologies, and infrastructure planning to position India as a cost-competitive AI and cloud hub.
India Emerges as Global Leader in Generative AI Adoption with Strong ROI, Snowflake Study Finds
Indian enterprises are among the fastest adopters of generative artificial intelligence globally, with 71 percent reporting positive returns on investment, significantly higher than the global average of 61 percent, according to a new report by Snowflake. The study, based on a survey of over 2,000 business and technology leaders across 10 countries, places India among the top three markets for GenAI adoption alongside the United States and Germany. Around 42 percent of Indian organisations have already moved beyond pilot projects to deploy AI at scale across multiple use cases, particularly in IT operations (76 percent), data analytics (75 percent), and cybersecurity (69 percent), all of which exceed global averages.
The report highlights that Indian companies are integrating AI deeply into core operations, especially in software engineering, where 77 percent use AI for code generation and 76 percent for code review and debugging. Enterprises also report strong outcomes, including improved operational efficiency (94 percent), increased innovation (92 percent), and better financial performance (86 percent). Looking ahead, firms in India plan to allocate nearly 28 percent of their technology budgets to generative AI, above the global average, with rapid uptake of agentic AI systems also underway. For non-Indian companies, the findings signal India’s growing importance as a high-maturity AI market, offering opportunities for partnerships, product deployment, and talent sourcing, while also intensifying competitive pressures as Indian firms scale AI-driven efficiencies across sectors.
Editor’s Note: Indian enterprises are among the fastest adopters of generative AI worldwide, with 71% reporting positive ROI—well above the global average—and nearly half deploying AI at scale across IT operations, analytics, and cybersecurity. The Snowflake study highlights India’s deep integration of AI into core functions like software engineering, driving efficiency, innovation, and financial gains, with firms planning to allocate nearly 28% of tech budgets to GenAI.
India Eases Investment Rules for Minority Chinese Stakes, Speeds Up Approvals
India will offer faster approvals for foreign investments involving minority Chinese stakes, marking a notable policy shift after years of restrictions imposed following the 2020 India-China border clash. Industry Secretary Amardeep Singh Bhatia said the government has removed the blanket approval requirement for companies with up to 10 percent Chinese ownership and introduced a time-bound clearance mechanism of 60 days for investments in sectors such as electronics, batteries, and rare-earth processing, provided Indian entities retain majority control. An inter-ministerial panel led by the cabinet secretary will continue to review such proposals and may update the list of eligible sectors.
The move reflects a recalibration of policy under Narendra Modi, aimed at supporting domestic manufacturing and addressing capital and technology gaps that emerged under earlier curbs. Industry experts say the streamlined process could revive stalled joint ventures and funding proposals, including previously shelved plans such as a $1 billion investment by BYD. While security vetting will remain in place, the faster and clearer approval framework is expected to accelerate project execution. For non-Indian companies, the policy signals improved investment conditions and potential partnership opportunities in manufacturing ecosystems involving Chinese supply chains, while also highlighting India’s balancing approach between economic openness and national security oversight.
Editor’s Note: India has eased rules for foreign investments with minority Chinese stakes, removing blanket approval requirements for up to 10% ownership and introducing a 60‑day clearance process in key sectors like electronics and batteries. The streamlined framework is expected to revive stalled projects and attract new partnerships, balancing economic openness with continued national security oversight.
India Eyes $10.8 Billion Semiconductor Fund to Boost Domestic Chip Ecosystem
India is preparing a major push to strengthen its position in the global semiconductor race, with the government considering a fund of over ₹1 trillion ($10.8 billion) to support domestic chipmaking, according to sources familiar with the discussions. The proposed initiative, which could be unveiled within the next two to three months, is expected to provide subsidies for chip design, manufacturing equipment, and broader supply-chain development. The move builds on policy momentum under Narendra Modi, as New Delhi seeks to expand its role in global electronics manufacturing amid intensifying competition driven by measures such as the US CHIPS and Science Act and similar efforts in China. Parallel discussions are also underway to extend or redesign incentives for smartphone manufacturing as the current scheme nears its expiry.
The new fund would complement India’s existing $10 billion semiconductor incentive programme launched in 2021, which has already attracted investments from companies including Micron Technology, alongside domestic expansion by Tata Group and commitments from Foxconn Technology Group. While early projects have focused on less advanced chips, India aims to climb the value chain and compete more closely with leading semiconductor hubs such as Taiwan, South Korea, and the United States by 2032. For non-Indian companies, the proposed fund signals expanding opportunities to participate in India’s semiconductor ecosystem through partnerships, supply chain integration, and technology investments, while also intensifying global competition for talent, capital, and fabrication capacity.
Editor’s Note: India is considering a new ₹1 trillion ($10.8 billion) semiconductor fund to support chip design, manufacturing equipment, and supply-chain development, building on its existing $10 billion incentive program. The initiative aims to attract global and domestic investments, help India move up the semiconductor value chain, and compete with leading hubs like Taiwan, South Korea, and the US by 2032.
US Launches Section 301 Probes into 16 Economies, Signalling Shift in Trade Strategy
The administration of Donald Trump has initiated a new round of trade investigations targeting sixteen economies, including India, in what analysts see as a significant shift in US trade policy. On March 11, 2026, the Office of the United States Trade Representative launched probes under Section 301 to examine trade practices and industrial policies across a broad group of economies, including China, the European Union, Japan, South Korea, and several Southeast Asian nations. The investigations will span key sectors such as steel, aluminium, automobiles, semiconductors, electronics, batteries, and solar modules, signalling a wide-ranging review of global supply chains and competitive dynamics.
According to the Global Trade Research Initiative, the move follows a US Supreme Court ruling that invalidated certain reciprocal tariff measures, effectively prompting a recalibration of Washington’s trade approach. The think tank described the investigations as emerging from the collapse of the earlier tariff strategy, with the US now turning to broader regulatory scrutiny. For non-Indian companies, the development underscores rising trade policy uncertainty and the potential for new tariffs or restrictions across multiple jurisdictions, making it critical for multinational firms to reassess supply chains, compliance exposure, and market strategies in sectors likely to be affected by the probes.
Editor’s Note: The US has launched Section 301 investigations into 16 economies, including India, China, the EU, Japan, and South Korea, covering sectors like steel, semiconductors, batteries, and solar modules. Analysts see this as a major shift in trade policy, replacing earlier tariff strategies with broader regulatory scrutiny and raising uncertainty for global supply chains and multinational firms.