Economy
The week in charts: Tariff troubles, easing inflation, ONGC NTPC Green deal
Summary
Every week, Plain Facts publishes a compilation of data-based insights, with easy-to-read charts to help you delve deeper into the stories reported by Mint in the week gone by.
US President Donald Trump has imposed a 25% tariff on all steel and aluminium imports, a move that could upend the global metals market. Meanwhile, the Bharatiya Janata Party (BJP) won the Delhi assembly elections, ending the decade-long rule of the Aam Aadmi Party (AAP). On the economic front, retail inflation has eased further.
Import levies
US President Donald Trump has imposed a 25% tariff on all steel and aluminium imports, effective 4 March. The US sources most of its steel from Canada, Brazil, Mexico, and the EU, which will now face higher costs. While India exports only a small quantity of steel to the US, Indian steelmakers are concerned about the indirect impact. The surge in global steel supply to India, particularly from China, has already been affecting domestic producers, and this new tariff could lead to more supply.
Easing prices
Retail inflation eased to a five-month low of 4.31% in January, down from 5.22% in December. The decline was mainly driven by lower food inflation, which fell to 6% from 8.39% in the previous month. In the food basket, inflation in cereals, vegetables, and pulses also eased. A Mint poll of 23 economists had projected a 4.5% inflation rate. The RBI expects inflation to average 4.4% in January-March, though global market uncertainties, fuel price volatility, and unpredictable weather could pose risks to this trend.
Go green
₹6,600 crore: This is the amount ONGC NTPC Green Pvt. Ltd (ONGPL) is set to pay for Ayana Renewable Power Pvt. Ltd, a company backed by the National Investment and Infrastructure Fund (NIIF), Mint reported. The deal, valued at ₹195 billion ($2.3 billion), marks ONGPL's first strategic acquisition since its formation in 2024. Ayana, with a 4.1 GW renewable energy portfolio, plans to expand to 10 GW by 2025. The acquisition supports ONGC and NTPC’s sustainability goals and net-zero targets.
Role reversal
In a historic win, the Bharatiya Janata Party (BJP) has won the assembly elections in Delhi, defeating the incumbent Aam Aadmi Party (AAP). The BJP secured 48 out of 70 seats, marking a significant reversal of fortune as it ended AAP's decade-long rule in the national capital. Meanwhile, AAP, which had dominated with 62 seats in the previous assembly elections held in 2020, saw a major decline, winning just 22 seats. The Indian National Congress (INC) remained in the wilderness, failing to win a single seat.
Margin squeeze
The RBI’s first rate cut in five years marks a significant shift in policy under the new leadership of Sanjay Malhotra. Despite a challenging liquidity deficit and tightening conditions in the banking system since December, the RBI's proactive measures, including forex market interventions and liquidity infusions, have helped stabilize the situation. While rate cuts typically compress net interest margins for banks, the impact may be less severe this time as rising deposit rates and proactive liquidity measures are likely to make rate cut transmission easier, a Mint analysis showed.
Spicy deal
$1.4 billion: This is the amount ITC Ltd is negotiating to acquire Orkla ASA’s Indian businesses, MTR Foods Pvt. Ltd and Eastern Condiments Pvt. Ltd, Mint reported. The acquisition would help ITC expand its footprint in the southern market, especially in ready-to-cook foods and spices. While MTR and Eastern are dominant in the south, growing competition in the sector could be intensified. If the deal goes through, ITC will challenge brands like Everest and MDH. Orkla is also considering an IPO if the private sale doesn't achieve a favourable valuation.
FPI pullback
The banking and financial services sector, comprising 34.35% of the Nifty 50, faced significant foreign portfolio investor (FPI) outflows in January, with a withdrawal of $2.88 billion—the highest since October. This is amid broader market concerns about high funding costs, asset quality, and sluggish loan growth. The sector’s performance remains weak, with limited growth in high-margin products and a challenging interest rate environment. Despite having a heavy weight, the sector’s returns are disappointing compared to broader market indices.
Chart of the week: Cash craze
Cash transfers to women have become a common pre-election promise, with 14 states currently offering such schemes. According to a report by Axis Bank, 20% of adult women are estimated to benefit from these schemes.
Follow our data stories on the “In Charts" and “Plain Facts" pages on the Mint website.
